History of Management Thought Daniel A. Wren Chapter 16

1. inter est in and concer n for or ganizational str uctur e, author ity, coor dination,
span of contr ol, and other issues r elevant to or ganizational design
Intr oduction
3 phases of evolution
incr easing concer n for a top-management view point that pr eceded r enew ed
inter est in the w or k of Henr y Fayol
antecedents to later thinking about the natur e of the fir m and the r ole of management
Pr esident of th Gener al Motor s Ex por t Cor por ation
degr ee in mining engineer ing fr om Case Institute (1908)
Biogr aphy
w as Roosevelt's secr et emissar y to Hitler
1942 : head of the U.S. Navy Bur eau of Aer onautics
Pr esident and chair man of the boar d of Willys Over land Motor s
On ward In dus try(w ith Alan C. Reiley)
pr oduction and distr ibution
pr inciples of or ganizational efficiency
efficient coor dination of all r elationship
pr ofit thr ough ser vice as an obligation
Or ganization
Management
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the for m of ever y human association for the attainment
of a common pur pose
the vital spar k w hich actuates, dir ects and contr ols the
plans and pr ocedur e of or ganization
r elation of management to or ganization analogous to
the r elation of the psychic complex to the physical body
Par t III The Social Per son Er a- Ch. 16
or der ly ar r angement of gr oup effor t, to pr ovide unity of
action in the pur suit of a common pur pose
concer ned w ith for mal str uctur e and objective
had its foundation in author ity
sear ch for pr inciples of or ganization and pr inciple of management
supr eme coor dinating pow er
Mooney & Reiley : ex tr icated r ules of or ganization
fr om histor y to incr ease or ganizational efficiency
author ity
Henr y Dennison : flex ible str uctur e
Gulick, Ur w ick, Gr aicunas : for mal r elationship to r educe confusion
and foster cer tainty and pr edictability
Davis : shift in management thinking fr om top management view
point w ith or ganic functions
the sour ce of r esponsibility for dir ection
r ight inher ed legitimately in the or ganization
coor dination
James D. Mooney : The Affable Ir ishman
Summar y
definition of the objective
Concepts and opinions
had to be under stood by member to add
the degr ee of teamw or k and accomplish
objectives
doctr ine
Pr inciple of Or ganization
Gulick&Ur w ick : synthesize management theor y
r ight inher ed legitimately in the or ganization
Hopf : scientific appr oach to study of the fir m as a w hole
hier ar chy of degr ees of author ity and cor r esponding
r esponsibility in ever y or ganization
separ ation of ow ner ship and contr ol
tr ansaction cot economics
had its foundation in leader ship
scalar pr inciple
leader ship
mechanical engineer
w or ked at Winchester Repeating Ar ms Company
established the depar tment of management in the
College of Commer ce and Administr ation
delegation confer r ed author ity on a subor dinate by a super ior
division of labor
functional pr inciple
need for coor dination
set up a depar tment of management in the Gener al Motor s Insitute
line vs staff
tr aditional, shop-level, oper ative management
or ientation, factor y management
hier ar chical str uctur es
depar tmentation
1. fundamental functions
lar ge-scale or ganizations r equir ed for malism in design
2. division of r esponsibility
coor dination
4. functioning of the system
consider ation of developing the or ganization
5. flex ibility of or ganization
pr inciples r esembled Weber 's bur eaucr atic hier ar chy,
legal notion of author ity, and defined duties &
r esponsibilities
6. pr ovision for futur e gr ow th
7. per sonal char acter istic & abilities
studied gover nments, ar mies, catholic chur ch
8. cr eation of an ideal
his management thought about pr inciples of or ganization became a
building block for a for malistic view s of or ganization
9. quality of leader ship
design of or ganizational str uctur e diametr ically
opposed to Mooney & Reiley's appr oach
specification of the factor s, for ces, effects and
r elationships that enter into and ar e r equir ed for the
solution of a business pr oblem
or ganization engineer ing = making a success of gr oup life
find like-minded people, gr oup them, develop the total
or ganization str uctur e last
planning
mental w or k of cr eative natur e that facilitated
under standing and accomplishment of the
or ganization's mission
1. r egar d for his ow n family's w elfar e and standing
2. liking for the w or k itself
br inging functions, physical factor s and per sonnel into
pr oper r elationships w ith one another
r ight to plan, or ganize, and contr ol the or ganization's activities
motivation
Ralph C. Davis : Pater Familiae Et M agis ter
4. r espect and r egar d for the main pur pose of the or ganization
tr aditional view , decision making
concepts
constr aining and r egulating activities
advocated modifying jobs to pr ovide gr eater satisfaction
or ganic functions of management
r outine planning
Henr y Dennison, Organ ization En gin eerin g(1931)
r ecognized infor mal gr oups and their influence on
r estr iction of output
nonfinancial incentives w hen pr oper ly mix ed w ith
economic incentives built loyalty
scheduling
pr epar ation
dispatching
3. r egar d for one or mor e member s of the or ganization
and for their good opinion, and pleasur e in w or king
w ith them
or ganizing
based on author ity
final or ganizational str uctur e should be flex ible to
str engthen gr oup per for mance
8 contr ol functions
dir ection
author ity and r esponsibility should be clear ly defined
contr olling
super vision
span of contr ol optimum betw een 6-12 subor dinate
compar ison
pr ofit shar ing
cor r ective action
low inter est loans for employees to pur chase homes
economic incentives
employee r epr esentation plans
1. pr eliminar y contr ol
2. concur r ent contr ol
timing in phases of contr ol
unemployment insur ance to stabilize employees' incomes
ear ly per sonnel depar tments
3. cor r ective action
function of ex ecutive leader ship
a manager ial tr ansaction
management
Or g anization and Peo ple
any values that the business or ganization is r equir ed or
ex pected to acquir e, cr eate, pr eser ve or distr ibute
objective of business or ganization
Or ganizations : Str uctur e and Design
consultant, author and ex ecutive
biogr aphy
men
C. Canby Balder ston, Kar abasz, & Rober t P. Br echt on
M an agemen t of an En terpris e
(1935)
ex ecutive leader ship w as a motivating for ce
machines
mater ial
pr oduction or iented view of management
Tow ar d a Top-Management view point
or ganization as a for mal fr amew or k
per sonnel management outside shop-management boundar ies
for m follow s function in designing the or ganizational str uctur e
anticipate dictum str uctur e follow s str ategy
the state of development of a business enter pr ise tends
to per petuate an equilibr ium betw een the factor s of
size, cost and human capacity
highest degr ee r egular r ealization of the business objectives
E.H. Ander son & G.T. Schw enning of The Scien ce of
Production Organ ization (1938)
concepts
management teacher s
initiated by Char les L. Jamison fr om Univer sity of Michigan &William N.
Mitchell of Chicago
could be achieved by a scientific appr oach based on measur ement
or ganization should ser ve society and ther eby max imize ear nings
not sacr ificed one par t to the w hole, benefiting one
par ty at the ex pense of another
began for mal oper ations in 1941
foster a philosophy of management
goal of cor por ate gr ow th w as afaux ami
objectives
gr eater under standing by Ex ecutive leader ship
w ider acquaintance among people inter ested in management
gr eater r esponsibilities of top management dur ing WW II
inadequate planning and clar ification of futur e objectives
need for a synthesis in management education
synthesize Henr y Fayol's w or k
Har r y Hopf : Tow ar d The Optimum
optimology
money
elements of enter pr ise
Tex ts, Teacher s and Tr ends
all manager s should be judged by the r esults they obtained
negotiating w ith labor in an ex change r elationship
the ar t and science of or ganizing, pr epar ing, and dir ecting human effor t
applied to contr ol the for ces and to utilize the mater ials of natur e for the
benefit of man
management
The Fun damen tals of Top M an agemen t(1951)
or ganizational objectives w er e constr ained by
community ideals or commonly held standar ds of
business conduct
stimulated and dir ected member s
use of staff
team w or k
3. definite location of r esponsibility
pr ovide basis for economical and effective action in
achievement goals
r epr esent author ity
distinction betw een differ ent kinds of duties
biogr aphy
planning
study of top management
theor y and pr actice of management
Academy of Management
1. economic function of a company
or ganizing
contr olling
inter est
2. or ganizational str uctur e
for ming
3. health of its ear nings gr ow th
administr ative management
Analyzing Top Management
4. pr actices of fair ness to stockholder s
5. r esear ch and development pr actices
dir ecting
coor dinating depar tments
Jackson Mar tindell : Cr iter ia for sustain, quality of the management
pr ofessor
member
6. fiscal policies
business people
7. value contr ibuted by the boar d of dir ector s
r eflected the incr eased aw ar eness of the necessity of teaching
management & br inging together diver se ideas into a sear ch for
management theor y
8. company's pr oductive efficiency
9. sales or ganization
10. ex ecutive abilities of the company
incr easing aw ar eness of the r elationship of industr y to society as a w hole
manager s and dir ector s w er e economic autocr ats w ho
per for med a contr olling gr oup that hold the pow er to
diver t pr ofit into their pockets
shar eholder s had little contr ol over the selection of
manager s and dir ector s
need for management to r elate effectively to its public
social r esponsibility of management
customer s
Ar thur G. Ander son on In dus trial En gin eerin g an d Factory M an agemen t
(1928)
Ber le & Means on The M odern Corporation an d Private Property (1932)
aw ar eness of stakeholder s
no clear solution to separ ation of ow ner ship and contr ol
employee
need for pr ofessionalization in management
danger s in oligar chy of an ex ecutive gr oups that placed
its ow n inter ests above or ganization
lar ger view of the r ole of management
Rober t A. Gor don on Bus in es s Leaders hip in the Large Corporation(1945)
planning
solution : dynamic, pr ofessional ex ecutives w ho w er e
r esponsive to the needs of the gr oups ser ved by the
or ganization
tr ansfer ow ner ship r ight betw een buyer and seller
manager ial
staffing
tr ansactions
function of the manager
bar gaining
super ior -subor dinate
collective super ior
3 types of ow ner ship tr ansfer s
coor dination
Invisible and Visible hands
r epor ting
Luther Gulick (1937)
budgeting
managing w as not giving or der s but gaining the
cooper ation of those w ho car r ied out the or der s
decisions making, or der and instr uctions, leader ship
inter r elating var ious par ts of the w or k
infor m the ex ecutive thr ough r ecor ds, r esear ch and inspections
planning, accounting, contr ol
developed a theor y of depar tmentation
questioning Adam Smith's invisible hand
cost to using the mar ket mechanism, might be r educed
if a fir m could coor dinate these mar ket tr ansaction
for mal str uctur e of author ity, coor dinating
per sonnel function, tr aining staff, maintaining
favor able conditions of w or k
dir ecting
John R. Commons on In s titution al Econ omics : Its Place
in Political Econ omy (1934)
r ationing
if the mar ket is so efficient, w hy do w e have business fir ms?
br oad outline and methods to accomplish goals
or ganizing
management as 4th factor of pr oduction (Say, Atkinson, Mar hall)
smallest unit of analysis in the tr ansfer of pr oper ty r ights
stockholder s
public
Ow ner ship and Contr ol
R.H. Coase on The Nature of the Firm (1937)
Building blocks for Administr ative Theor y
major pur pose of or ganization w as coor dination
1. pur pose
gr ouping activities by
business fir ms as the visible hand
2. pr ocess used
3. per son or things dealt w ith
pr inciple of homogeneity
4. place
major gr ouping, pr imar y levels of depar tmentation
ensur e coor dination, maintain flex ibility
1. pr inciple of objective
2. pr inciple of cor r espondence
3. pr inciple of r esponsibility
Lt. Colonel Lyndall F. Ur w ick on Papers on the Scien ce of Admin is tration
8 pr inciples applicable to all or ganizations
4. the scalar pr inciple
5. pr inciple of the span of contr ol
6. pr inciple of specialization
7. coor dination pr inciple
8. pr inciple of definition
the smaller the r esponsibility of the gr oup member , the
lar ger may be the number of the gr oup
the near er w e appr oach the supr eme head of the w hole
or ganization, the mor e w e w or k tow ar ds gr oup of six
The Span of Contr ol
V.A. Gr aicunas
nar r ow & limited span of contr ol, suppor ted by
the psychological pr inciple of span of attention
cr oss r elationship, dir ect gr oup r elationship
geometr ic gr ow th of cr oss r elationships
max imum 4 or 5 subor dinate
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