02 history of management (chapter 2)

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  • What Would You Do? As the day shift supervisor at the steel plan, you summon six college student workers to give them a job hauling scrap metal into railroad cars. It is obvious, from the math, that the task is labor intensive. Furthermore, it will require the students to do a six week in two weeks to meet the sales deadlines. So, without more workers and without forklifts, all the metal has to be loaded by hand in two weeks. What would motivate the students to work harder than they have all summer? What can you change about the way work is done to deal with the physical fatigue? If you were the supervisor in charge, what would you do?
  • Only 125 years ago, business ideas and practices were very different from today’s widely accepted management ideas. Management wasn’t even a field of study, and there were no management jobs or management careers. This chapter presents origins of management ideas and practice throughout history and the historical changes that produced the need for managers. On this slide are some of the management examples that can be found throughout history, and how they are related to the management functions in the textbook.
  • Before scientific management, organizational decision making could best be described as ‘seat-of-the-pants.” Decisions were made haphazardly with no standardization of procedures, systematic study, or collection of information. In contrast, scientific management thoroughly studied and tested different work methods to identify the best, most efficient ways to complete a job.
  • Frederick W. Taylor, the “father of scientific management,” spent three years to improve output of workers who were deliberately restricting output. His principles are described on this slide. Taylor’s key ideas have stood the test of time. These include: using systematic analysis to identify the best methods scientifically selecting, training, and developing workers promoting cooperation between management and labor developing standardized approaches and tools setting specific tasks or goals and then rewarding workers with financial incentives giving workers shorter work hours and frequent breaks
  • In addition to their use of motion studies to simplify work, Frank and Lillian Gilbreth also made significant contributions to the employment of handicapped workers and industrial psychology. Lillian Gilbreth, the first woman to receive a Ph.D. in Management, also convinced the government to enact laws regarding workplace safety, ergonomics, and child labor.
  • In addition to their use of motion studies to simplify work, Frank and Lillian Gilbreth also made significant contributions to the employment of handicapped workers and industrial psychology. Lillian Gilbreth, the first woman to receive a Ph.D. in Management, also convinced the government to enact laws regarding workplace safety, ergonomics, and child labor.
  • Henry Gant, in addition to creating the Gantt chart, made significant contributions to management with pay-for-performance plans and the training and development of workers. A Gantt chart shows time in various units on the x-axis and tasks on the y-axis, visually indicating what tasks must be completed at which times in order to complete a project.
  • When we hear the term bureaucracy, we think of inefficiency and “red tape”, incompetence and ineffectiveness. However, when German sociologist Max Weber proposed the idea of bureaucratic organizations, monarchies were associated with these problems. Bureaucracy literally means to rule from a desk or office. In a bureaucracy, people would lead by virtue of rational-legal authority—from knowledge, expertise, and experience.
  • The aim of bureaucracy is to achieve an organization’s goals in the most efficient way possible.
  • Henri Fayol is best known for developing five functions of managers and 14 principles of management, as well as his belief that management could and should be taught to others. The five functions of successful management are: planning, organizing, coordinating, commanding, and controlling. His principles of effective management are shown on this slide.
  • Scientific management focuses on improving the efficiency of manufacturing facilities and their workers. Bureaucratic management focuses on using knowledge, fairness, and logical rules to increase the organization’s efficiency. Administrative management focuses on how and what managers should do in their jobs. In contrast, the human relations approach to management focuses on the psychological and social aspects of work. People are valuable organizational resources whose needs are important.
  • Follett is known for developing ideas regarding constructive conflict and coordination. She said that conflict is the appearance of difference, difference of opinions, of interests. Follett believed that managers could deal with conflict in three ways, as shown on this slide. Domination is a victory of one side over the other. Compromise involves both parties giving up some of what they want in order to reach agreement. Integrative conflict resolution involves both parties indicating their preferences and then working together to find an alternative that meets the needs of both.
  • Elton May’s ideas became popular during the twentieth century when labor unrest and protests were widespread in the U.S., Europe and Asia. Mayo's work proved relevant as managers looked for ways to increase productivity and to improve worker satisfaction and working conditions.
  • Chester Barnard is best known for his ideas about cooperation, the executive functions that promote it, and the acceptance of authority.
  • The key elements of operations management had origins in guns, geometry, and fire. Firearms manufacturers needed standardized, interchangeable parts. Following the theories of Eli Whitney, machine tools were designed which allowed unskilled workers to make each gun part the same as the next. Geometry techniques were used for drawing three-dimensional objects on paper, based on a book by Gaspard Monge. These precise drawings permitted manufacturers to make standardized, interchangeable parts without examining a prototype. Finally, a problem with too much inventory was plaguing manufacturers. A solution to this problem occurred in 1905 when the Oldsmobile Motor Works burned down. Management rented a new production facility to begin production again, and there was no room to store inventory. Since all its suppliers were close by, Oldsmobile could place orders in the morning and receive them by afternoon—creating the first just-in-time inventory system.
  • A system is a set of interrelated elements or parts that function as a whole. A systems approach encourages managers to look for connections between the different parts of the organization.
  • A system is a set of interrelated elements or parts that function as a whole. A systems approach encourages managers to look for connections between the different parts of the organization.
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Transcript

  • 1. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 1 Chapter 2 The History of Management
  • 2. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 4 Management Ideas and Practice Throughout History 1.11.1 5000 BC5000 BC 4000-2000 BC4000-2000 BC 1800 BC1800 BC 600 BC600 BC 500 BC500 BC 400 BC400 BC 400 BC400 BC 175175 284284 900900 11001100 14181418 14361436 15001500 15251525 SumeriansSumerians Egyptians Planning, organizing, controlling.Egyptians Planning, organizing, controlling. HammurabiHammurabi NebuchadnezzarNebuchadnezzar Sun TzuSun Tzu XenophonXenophon CyrusCyrus CatoCato DiocletianDiocletian AlfarabiAlfarabi GhazaliGhazali BarbarigoBarbarigo VenetiansVenetians Sir Thomas MoreSir Thomas More MachiavelliMachiavelli Record keepingRecord keeping Plan, organize, control. Written requests.Plan, organize, control. Written requests. Controls and written documentationControls and written documentation Wage incentives, production controlWage incentives, production control StrategyStrategy Management as a separate artManagement as a separate art Human relations and motion studyHuman relations and motion study Job descriptionsJob descriptions Delegation of authorityDelegation of authority Listed leadership traitsListed leadership traits Listed managerial traitsListed managerial traits Different organizational forms/structuresDifferent organizational forms/structures Numbering, standardization, interchangeabilityNumbering, standardization, interchangeability Critical of poor management and leadershipCritical of poor management and leadership Cohesiveness, power, and leadershipCohesiveness, power, and leadership
  • 3. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 5 Why We Need Managers Today Work in familiesWork in families Skilled laborersSkilled laborers Small, self-organized groups Small, self-organized groups Unique, small batches of production Unique, small batches of production ThenThenThenThen Work in factoriesWork in factories Specialized, unskilled laborers Specialized, unskilled laborers Large factoriesLarge factories Large standardized mass production Large standardized mass production NowNowNowNow 1.21.2
  • 4. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 7 Scientific Management 22 Scientific Management  Studies and tests methods to identify the best, most efficient ways Scientific Management  Studies and tests methods to identify the best, most efficient ways “Seat-of-the Pants” Management  No standardization of procedures  No follow-up on improvements “Seat-of-the Pants” Management  No standardization of procedures  No follow-up on improvements
  • 5. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 8 Frederick W. Taylor Frederick Taylor is known today as the "father of scientific management." One of his many contributions to modern management is the common practice of giving employees rest breaks throughout the day. Frederick W. Taylor, 1856-1915 (Part 2)
  • 6. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 9 Taylor’s Four Management Principles 2.12.1 Develop a science for each element of a man’s work, which replaces the old rule-of-thumb method. Develop a science for each element of a man’s work, which replaces the old rule-of-thumb method. Scientifically select and then train, teach, and develop the workman. Scientifically select and then train, teach, and develop the workman. Cooperate with the men to insure all work is done in accordance with the principles of the science. Cooperate with the men to insure all work is done in accordance with the principles of the science. There is almost equal division of the work and the responsibility between management and workmen. There is almost equal division of the work and the responsibility between management and workmen. Adapted from Exhibit 2.2 Find the “one best way” to do every job.
  • 7. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved Taylor’s Innovative Ideas  Using systematic analyses to identify best methods  Scientifically selecting and training the best workers  Promoting cooperation between workers and management  Developing standardized approaches and tools  Setting specific tasks and goals and then rewarding workers with financial incentives  Giving workers shorter hours and frequent breaks. 10
  • 8. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 11 Frank & Lillian Gilbreth 2.22.2 Frank and Lillian Gilbreth were prolific researchers and often used their family as guinea pigs. Their work is the subject of Cheaper by the Dozen, written by their son and daughter.
  • 9. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 12 Motion Studies: Frank & Lillian Gilbreth 2.22.2 Time Study Timing how long it takes good workers to complete each part of their jobs. Motion Study Breaking each task into its separate motions and then eliminating those that are unnecessary or repetitive.
  • 10. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 13 Charts: Henry Gantt 2.32.3 Also made significant contributions to management with pay-for-performance plans and the training and development of workers.
  • 11. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 14 Bureaucratic Management 3.13.1 Bureaucracy The exercise of control on the basis of knowledge, expertise, or experience. Max Weber, 1864-1920
  • 12. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 15 The Aim of Bureaucracy 3.13.1 1. Qualification-based hiring1. Qualification-based hiring 2. Merit-based promotion2. Merit-based promotion 3. Chain of command3. Chain of command 4. Division of labor4. Division of labor 5. Impartial application of rules and procedures5. Impartial application of rules and procedures 6. Recorded in writing6. Recorded in writing 7. Managers separate from owners7. Managers separate from owners Employees are hired on the basis of their technical training or educational background. Promotion is based on experience or achievement. Managers, not organizational owners, decide who is promoted. Each job occurs within a hierarchy, the chain of command, in which each position reports and is accountable to a higher position. A grievance procedure and a right to appeal protect people in lower positions. Tasks, responsibilities, and authority are clearly divided and defined. Rules and procedures apply to all members of the organization and will be applied in an impartial manner, regardless of position or status. The owners of an organization should not manage or supervise the organization. All administrative decisions, acts, rules, or procedures will be recorded in writing.
  • 13. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 16 Administrative Management: Henri Fayol 3.23.2 1. Division of work1. Division of work 2. Authority and responsibility 2. Authority and responsibility 3. Discipline3. Discipline 4. Unity of command4. Unity of command 5. Unity of direction5. Unity of direction 6. Subordination of individual interests 6. Subordination of individual interests 7. Remuneration7. Remuneration 8. Centralization8. Centralization 9. Scalar chain9. Scalar chain 10. Order10. Order 11. Equity11. Equity 12. Stability of tenure of personnel 12. Stability of tenure of personnel 13. Initiative13. Initiative 14. Esprit de corps14. Esprit de corps Adapted from Exhibit 2.5 Each worker – unique/smaller tasks Manager has authority, but not to be abused. Clearly defined rules and procedures. One and only one boss for each worker. One person/one plan for organizational objectives. Organizational goals first, individual goals second. “Fair” compensation, don’t underpay or overpay. Appropriate balance between centralizaiton or not. Vertical chain of authority; One worker/one boss No overlapping responsibilities Kind, fair and just treatment for all. Low employee turnover, stable work force. Encourage development of initiative in workers. Strong sense of morale and unity among workers. All about organizing the organization.
  • 14. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved Functional Management  Scientific Management – focuses on improving the efficiency of manufacturing facilities and their workers.  Bureaucratic Management – focuses on using knowledge, fairness and logical rules to increase organizational efficiencies.  Administrative Management – focuses on how and what managers should do in their jobs. 17 What about the workers???
  • 15. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 18 44 Human Relations Management Efficiency alone is not enough to produce organizational success. Success also depends on treating workers well.
  • 16. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 19 Mary Parker Follett Mary Parker Follett, 1868-1933 Mary Parker Follett is known today as the “mother of scientific management." Her many contributions to modern management include the ideas of negotiation, conflict resolution, and power sharing.
  • 17. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 20 4.14.1 Constructive Conflict and Coordination: Mary Parker Follett Dealing withDealing with ConflictConflict Dealing withDealing with ConflictConflict CompromiseCompromise DominationDomination IntegrationIntegration Domination is a victory of one side over the other. Compromise involves both parties giving up some of what they want in order to reach agreement. Integrative conflict resolution involves both parties indicating their preferences and then working together to find an alternative that meets the needs of both.
  • 18. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 22 4.24.2 Hawthorne Studies: Elton Mayo  Workers’ feelings and attitudes affected their work  Financial incentives weren’t the most important motivator for workers  Group norms and behavior play a critical role in behavior at work Experimenting with workers at Western Electric in Chicago between 1924 and 1932. Finding #1
  • 19. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 23 4.34.3 Cooperation and Acceptance of Authority: Chester Barnard Managers can gain cooperation by: Securing essential services from individuals Unifying people by clearly formulating an organization’s purpose and objectives Providing a system of effective communication
  • 20. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 24 4.34.3 Cooperation and Acceptance of Authority: Chester Barnard People will willingly carry out managerial directives if they… 1. are understood 2. are consistent with the purpose of the organization 3. are compatible with the people’s personal interests 4. can actually be carried out by those people
  • 21. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 25 55 Operations, Information, Systems, and Contingency Management Information ManagementInformation Management Operations ManagementOperations Management Contingency ManagementContingency Management Systems ManagementSystems Management Managing the daily production of goods and services Managing parts of the organization for the good of The whole organization. Managing the information needed by the organization to make good decisions. Managing depending upon the situation.
  • 22. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 26 5.15.1 Operations Management Tools Quality controlQuality control Forecasting techniquesForecasting techniques Capacity planningCapacity planning Productivity measurement and improvementProductivity measurement and improvement Linear programmingLinear programming Scheduling systemsScheduling systems Inventory systemsInventory systems Work measurement techniquesWork measurement techniques Project managementProject management Cost-benefit analysisCost-benefit analysis
  • 23. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 27 5.15.1 Operations Management Tools Origins ofOrigins of OperationsOperations ManagementManagement Origins ofOrigins of OperationsOperations ManagementManagement GeometryGeometry GunsGuns FireFire
  • 24. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 28 Whitney, Monge, and Olds Eli Whitney, 1765-1825 Gaspard Monge, 1746-1818 Ransom Olds, 1864-1950
  • 25. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 29 5.35.3 Information Management Milestones in information management: 1400s Horses in Italy 1500-1700 Creation of paper and the printing press 1850 Manual typewriter 1860s Vertical file cabinets and the telegraph 1879 Cash registers 1880s Telephone 1890s Time clocks 1980s Personal computer 1990s Internet
  • 26. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 30 5.35.3 Systems Management Objective of Systems Management: to take advantage of the organization’s internal, specific and general environments to create synergy for increased productivity. Objective of Systems Management: to take advantage of the organization’s internal, specific and general environments to create synergy for increased productivity. Objective of Systems Management: to take advantage of the organization’s internal, specific and general environments to create synergy for increased productivity.
  • 27. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 31 Biz Flix: In Good Company Take Two Video Click Is Carter Duryea’s explanation of synergy the same as the text definition? Dan identifies a potential downside with Carter’s plan. Do you agree with Dan or Carter?
  • 28. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 32 5.45.4 Contingency Management Contingency Approach Holds that the most effective management theory or idea depends on the kinds of problems or situations that managers are facing at a particular time and place.
  • 29. Chapter 2 Copyright ©2009 by Cengage Learning Inc. All rights reserved 33 5.45.4 Contingency Management Management is harder than it looks Managers need to look for key contingencies that differentiate today’s situation from yesterday’s situation Managers need to spend more time analyzing problems before taking action Pay attention to qualifying phrases, such as “usually”