The Evolution of Management Thinking


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The Evolution of Management Thinking

  1. 1. The Evolution of Management Thinking CHAPTER 2 0
  2. 2. Learning Objectives <ul><li>Understand how historical forces influence the practice of management. </li></ul><ul><li>Identify and explain major developments in the history of management thought. </li></ul><ul><li>Describe the major components of the classical and humanistic management perspectives. </li></ul><ul><li>Discuss the management science perspective and its current use in organizations. </li></ul>0
  3. 3. Learning Objectives (contd.) <ul><li>Explain the major components of systems theory, the contingency view, and total quality management. </li></ul><ul><li>Describe the learning organization and the changes in structure, empowerment, and information sharing that managers make to support it. </li></ul><ul><li>Discuss the technology-driven workplace and the role of outsourcing, supply chain management, enterprise resource planning, knowledge management systems, and customer relationship management. </li></ul>0
  4. 4. Management and Organization <ul><li>Management philosophies and organization forms change over time to meet new needs </li></ul><ul><li>Some ideas and practices from the past are still relevant and applicable to management today </li></ul>0
  5. 5. Historical Perspective <ul><li>Provides a context or environment </li></ul><ul><li>Develops an understanding of societal impact </li></ul><ul><li>Achieves strategic thinking </li></ul><ul><li>Improves conceptual skills </li></ul><ul><li>Social, political, and economic forces have influenced organizations and the practice of management </li></ul>0
  6. 6. Forces Influencing Organizations and Management <ul><li>Social Forces - values, needs, and standards of behavior </li></ul><ul><li>Political Forces - influence of political and legal institutions on people & organizations </li></ul><ul><li>Economic Forces - forces that affect the availability, production, & distribution of a society’s resources among competing users </li></ul>0
  7. 7. Management Perspectives Over Time Exhibit 2.1 0
  8. 8. Classical Perspective: 3000 B.C. <ul><li>Rational, scientific approach to management – make organizations efficient operating machines </li></ul><ul><li>Scientific Management </li></ul><ul><li>Bureaucratic Organizations </li></ul><ul><li>Administrative Principles </li></ul>0
  9. 9. Scientific Management: Taylor 1856-1915 <ul><li>General Approach </li></ul><ul><li>Developed standard method for performing each job. </li></ul><ul><li>Selected workers with appropriate abilities for each job. </li></ul><ul><li>Trained workers in standard method. </li></ul><ul><li>Supported workers by planning work and eliminating interruptions. </li></ul><ul><li>Provided wage incentives to workers for increased output. </li></ul>0
  10. 10. Scientific Management <ul><li>Contributions </li></ul><ul><li>Demonstrated the importance of compensation for performance. </li></ul><ul><li>Initiated the careful study of tasks and jobs. </li></ul><ul><li>Demonstrated the importance of personnel and their training . </li></ul><ul><li>Criticisms </li></ul><ul><li>Did not appreciate social context of work and higher needs of workers. </li></ul><ul><li>Did not acknowledge variance among individuals. </li></ul><ul><li>Tended to regard workers as uninformed and ignored their ideas </li></ul>0
  11. 11. Bureaucratic Organizations <ul><li>Max Weber 1864-1920 </li></ul><ul><li>Prior to Bureaucracy Organizations </li></ul><ul><ul><li>European employees were loyal to a single individual rather than to the organization or its mission </li></ul></ul><ul><ul><li>Resources used to realize individual desires rather than organizational goals </li></ul></ul><ul><li>Systematic approach –looked at organization as a whole </li></ul>0
  12. 12. Characteristics of Weberian Bureaucracy Positions organized in a hierarchy of authority Managers subject to Rules and procedures that will ensure reliable predictable behavior Personnel are selected and promoted based on technical qualifications Administrative acts and decisions recorded in writing Management separate from the ownership of the organization Division of labor with Clear definitions of authority and responsibility Exhibit 2.3 0
  13. 13. Administrative Principles <ul><li>Contributors : Henri Fayol, Mary Parker Follett, and Chester I. Barnard </li></ul><ul><li>Focus : </li></ul><ul><ul><li>Organization rather than the individual </li></ul></ul><ul><ul><li>Delineated the management functions of planning, organizing, commanding, coordinating, and controlling </li></ul></ul>0
  14. 14. Henri Fayol 1841-1925 Examples of General Principles of Management <ul><li>Division of work </li></ul><ul><li>Unity of command </li></ul><ul><li>Unity of direction </li></ul><ul><li>Scalar chain </li></ul>0
  15. 15. Mary Parker Follett 1868-1933 <ul><li>Importance of common super-ordinate goals for reducing conflict in organizations </li></ul><ul><ul><li>Popular with businesspeople of her day </li></ul></ul><ul><ul><li>Overlooked by management scholars </li></ul></ul><ul><ul><li>Contrast to scientific management </li></ul></ul><ul><ul><li>Reemerging as applicable in dealing with rapid change in global environment </li></ul></ul><ul><li>Leadership – importance of people vs. engineering techniques </li></ul>Ethics - Power - Empowerment 0
  16. 16. Chester Barnard 1886-1961 <ul><li>Informal Organization </li></ul><ul><ul><li>Cliques </li></ul></ul><ul><ul><li>Naturally occurring social groupings </li></ul></ul><ul><li>Acceptance Theory of Authority </li></ul><ul><ul><li>Free will </li></ul></ul><ul><ul><li>Can choose to follow management orders </li></ul></ul>0
  17. 17. Humanistic Perspective <ul><li>Emphasized understanding human behavior, needs, and attitudes in the workplace </li></ul><ul><li>Human Relations Movement </li></ul><ul><ul><li>Human Resources Perspective </li></ul></ul><ul><ul><li>Behavioral Sciences Approach </li></ul></ul>0
  18. 18. Human Relations Movement <ul><li>Emphasized satisfaction of employees’ basic needs as the key to increased worker productivity </li></ul>
  19. 19. <ul><li>Started in 1895 </li></ul><ul><li>Four experimental & three control groups </li></ul><ul><li>Five different tests </li></ul><ul><li>Test pointed to factors other than illumination for productivity </li></ul><ul><li>1st Relay Assembly Test Room experiment, was controversial, test lasted 6 years </li></ul><ul><li>Interpretation, money not cause of increased output </li></ul><ul><li>Factor that increased output, Human Relations </li></ul>Hawthorne Studies 0
  20. 20. Human Resource Perspective <ul><li>Suggests jobs should be designed to meet higher-level needs by allowing workers to use their full potential </li></ul>0
  21. 21. Abraham Maslow 1908-1970 <ul><li>Identified a hierarchy of needs </li></ul><ul><li>Problems stem from an inability to satisfy one’s needs </li></ul>0
  22. 22. <ul><li>Dislike work –will avoid it </li></ul><ul><li>Must be coerced, controlled, directed, or threatened with punishment </li></ul><ul><li>Prefer direction, avoid responsibility, little ambition, want security </li></ul><ul><li>Do not dislike work </li></ul><ul><li>Self direction and self control </li></ul><ul><li>Seek responsibility </li></ul><ul><li>Imagination, creativity widely distributed </li></ul><ul><li>Intellectual potential only partially utilized </li></ul>Douglas McGregor Theory X & Y 1906-1964 Theory X Assumptions Theory Y Assumptions 0
  23. 23. Behavioral Sciences Approach <ul><li>Applies social science in an organizational context </li></ul><ul><li>Draws from economics, psychology, sociology, anthropology, and other disciplines </li></ul><ul><ul><li>Understand employee behavior and interaction in an organizational setting </li></ul></ul><ul><ul><li>OD – Organization Development </li></ul></ul>Sub-field of the Humanistic Management Perspective 0
  24. 24. Management Science Perspective <ul><li>Emerged after WW II </li></ul><ul><li>Applied mathematics, statistics, and other quantitative techniques to managerial problems </li></ul><ul><ul><li>Operations Research – mathematical modeling </li></ul></ul><ul><ul><li>Operations Management – specializes in physical production of goods or services </li></ul></ul><ul><ul><li>Information Technology – reflected in management information systems </li></ul></ul>0
  25. 25. Recent Historical Trends <ul><li>Systems Theory </li></ul><ul><li>Contingency View </li></ul><ul><li>Total Quality Management (TQM) </li></ul>0
  26. 26. Systems View of Organizations Exhibit 2.5 0
  27. 27. Contingency View of Management Exhibit 2.6 0
  28. 28. TQM <ul><li>Focuses on managing the total organization to deliver quality to customers. </li></ul><ul><li>Four significant elements are </li></ul><ul><ul><li>Employee involvement </li></ul></ul><ul><ul><li>Focus on the customer </li></ul></ul><ul><ul><li>Benchmarking </li></ul></ul><ul><ul><li>Continuous improvement </li></ul></ul>0
  29. 29. Elements of a Learning Organization Learning Organization Open Information Empowered Employees Team-Based Structure Exhibit 2.7 0
  30. 30. Types of E-Commerce Business-to-Consumer B2C Selling Products and Services Online Business-to-Business B2B Transactions Between Organizations Consumer-to-Consumer C2C Electronic Markets Created by Web-Based Intermediaries Exhibit 2.8 0