Chapter 2 History of Management Thought-ppt.pdf

CHAPTER 2: HISTORY OF MANAGEMENT THOUGHT William G. “Bill” Borges All Rights Reserved © 2023 Principles of Management 2e |1  Learning Outcomes 2.1 Understand management as a science and as an art. 2.2 Describe the three classical viewpoints of management: s...

CHAPTER 2: HISTORY OF MANAGEMENT THOUGHT William G. “Bill” Borges All Rights Reserved © 2023 Principles of Management 2e |1  Learning Outcomes 2.1 Understand management as a science and as an art. 2.2 Describe the three classical viewpoints of management: scientific management, administrative management, and bureaucratic management. 2.3 Explain the behavioral science perspective of management. 2.4 Describe the quantitative perspective of management. 2.5 Discuss the two contemporary views of management: systems view and contingency view. 2.6 Describe the challenges in contemporary management. All Rights Reserved © 2023 Principles of Management 2e |2  Management: A Science Or An Art? Believes in specific best practices for Management management is a Science Uses objective, universal solutions to problems based on fact and evidence Believes in importance of social and political Management contexts of managerial issues is an Art Uses managers’ knowledge and experience to solve problems Good management is a balance of both science and art! Science establishes general principles that guide organizations, while the art of human skill puts those principles to their best use. All Rights Reserved © 2023 Principles of Management 2e |3  Classical Management The oldest formal school of management thought. Discusses methods to make organizations more efficient. I. Scientific Management Focuses on maximizing worker productivity. Taylor’s Principles of Scientific Management: ✓ Separation of planning and doing ✓ Functional foremanship ✓ Elements of scientific management – Scientific methods, Standardization, and Centralization ✓ Bilateral mental revolution ✓ Financial incentives ✓ Economy All Rights Reserved © 2023 Principles of Management 2e |4  Classical Management (Cont’d) I. Scientific Management (Cont’d) Harrington Emerson’s 12 Principles of Efficiency: ✓ Clearly defined ideals ✓ Planning and dispatching ✓ Sound judgment and common sense ✓ Standards and schedules ✓ Competent counsel ✓ Standardized conditions ✓ Discipline ✓ Standardized operations ✓ Fairness in deals ✓ Written standard-practice instructions ✓ Reliable and accurate records ✓ Efficiency rewards All Rights Reserved © 2023 Principles of Management 2e |5  Classical Management (Cont’d) II. Administrative Management Concerns the management of the whole organization instead of individual employees. Henri Fayol’s 14 Principles of Management: ✓ Division of work ✓ Centralization ✓ Authority and responsibility ✓ Scalar chair ✓ Discipline ✓ Order ✓ Unity of command ✓ Equity ✓ Unity of direction ✓ Stability of tenure of personnel ✓ Subordination of individual interest to general interest ✓ Initiative ✓ Remuneration of personnel ✓ Esprit de corps All Rights Reserved © 2023 Principles of Management 2e |6  Classical Management (Cont’d) III. Bureaucratic Management Concerns the ideal structure of organizations. Max Weber’s elements of an ideal bureaucracy: ✓ A formal set of rules and procedures ✓ A clear chain of command ✓ Division of labor according to expertise ✓ Selection and promotion of individuals based on ability and merit ✓ Professionalism among managers All Rights Reserved © 2023 Principles of Management 2e |7  Behavioral Management Emphasizes the significance of individual personalities and behaviors in determining behavioral outcomes in the working environment. Posits that a superior understanding of human behavior such as motivation, expectation, or conflict would enhance productivity in the workplace. Is concerned with the social and mental facets of human behavior in organizations. All Rights Reserved © 2023 Principles of Management 2e |8  Behavioral Management (Cont’d) I. Mayo’s Hawthorne Studies Emphasizes the significance of individual personalities and behaviors in determining behavioral outcomes in the working environment. Posits that a superior understanding of human behavior such as motivation, ✓ Social system expectation, or conflict would enhance productivity in the ✓ workplace. Social environment ✓ Informal organization ✓ Group dynamics ✓ Is concerned Informal leader with the social and mental facets of human behavior in ✓ Non-economic reward organizations. All Rights Reserved © 2023 Principles of Management 2e |9  Behavioral Management (Cont’d) II. Human Relations Movement Workers essentially react to the social context of their work environment. Managers’ concern for employees prompts higher satisfaction, which then leads to enhanced performance. Maslow’s Hierarchy of Needs People are motivated by a hierarchical set of needs, and will satisfy lower level needs before attempting to satisfy higher level ones. These needs are (from low to high): Self- Physiological Safety Social Ego/Esteem Actualization All Rights Reserved © 2023 Principles of Management 2e | 10 All Rights Reserved © 2023 Principles of Management 2e | 11  Behavioral Management (Cont’d) II. Human Relations Movement (Cont’d) McGregor’s Theory X and Theory Y Theory X and Theory Y reflect two belief sets that managers hold about their employees. Managers should change their attitude about Theory X and encourage workers with Theory Y assumptions in mind to improve performance. Theory X assumes that an employee… Theory Y assumes that an employee… Dislikes work and endeavors to avoid it Perceives work to be as natural as rest and play Has no aspiration and wants no responsibility Seeks and accepts responsibility Does not concern himself with company goals Is motivated to meet his company goals Opposes change Can be creative in solving organizational issues Is naïve and not very smart Is intelligent and has potential All Rights Reserved © 2023 Principles of Management 2e | 12  Quantitative Management Focused on applying quantitative methods, such as statistics, computer simulations, and information models, to management. I. Management Science This perspective urges managers to use mathematical models, arithmetic, statistics, and other quantitative methods to take administrative decisions. Examples of management science applications in use today are forecasting, stock modeling, queuing theory, and computer simulations. All Rights Reserved © 2023 Principles of Management 2e | 13  Behavioral Management (Cont’d) II. Human Relations Movement (Cont’d) Ouchi’s Theory Z Theory Z is grounded in a mix of Japanese and American management theories. It recommends that organizations uphold the following factors in management: ✓ Job stability to elicit employees’ commitment and loyalty. ✓ Job rotation to build employees’ cross-sectional skills. ✓ Involvement of employees in decision making. ✓ Care and interest in the development of employees and in the welfare of employees’ families. All Rights Reserved © 2023 Principles of Management 2e | 14  Quantitative Management (Cont’d) II. Operations Management This is an applied science that is less measurable than management science. It concentrates on the transformation of raw materials, work, and money into valuable merchandise and/or services. Examples include inventory management, quality control, and break-even analysis. III. Management Information Systems Management information systems sort out information from both inner and outer sources and analyze it to form usable data for managers. With this, managers can recognize and assess decision options, predict the outcomes of these options, and consequently select the best option. All Rights Reserved © 2023 Principles of Management 2e | 15  Contemporary Management Perspectives I. Systems View The most acceptable approach in modern management. This view sees organizations as an integrated system of combined parts. The primary idea of the system approach is the holistic perspective when facing an issue - no part of the system can be evaluated without taking the entire system into account, and no system can be considered without comprehending each of its individual parts. There four fundamental components in a system: inputs, transformation processes, outputs, and feedback. All Rights Reserved © 2023 Principles of Management 2e | 16 Contemporary Management Perspectives (Cont’d) I. Systems View (Cont’d) Open systems communicate with their environment, whereas closed systems do not. Subsystems are systems within a larger system, and can affect other subsystems. Synergy posits that subsystems are more effective when they work together. Entropy is a natural process that results in the decline of a system. All Rights Reserved © 2023 Principles of Management 2e | 17 All Rights Reserved © 2023 Principles of Management 2e | 18 Contemporary Management Perspectives (Cont’d) II. Contingency View General theories cannot be practiced in organizations as each organization is distinct from another. There is no ideal approach to handle all situations. Suitable managerial action in a situation relies on the unique details of that situation. The major determinants of a contingency are based on the internal and external factors surrounding an organization. It is the managers’ task to ascertain the strategy or decision that best contributes to management objectives under a particular situation. All Rights Reserved © 2023 Principles of Management 2e | 19  Contemporary Management Challenges Globalization Generational Differences Ethics & Social Responsibility Learning Organizations Organizational Change Technology All Rights Reserved © 2023 Principles of Management 2e | 20