ch02.ppt

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©2013 John Wiley & Sons, Inc. All rights reserved. 2-1
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©2013 John Wiley & Sons, Inc. All rights reserved.
JOHN R. SCHERMERHORN, JR.
MANAGEMENT
12th Edition
C h a p t e r 2
History of
Management Thought

Planning Ahead — Chapter 2 Study Questions
1. What can be learned from classical management
thinking?
2. What insights come from behavioral management
approaches?
3. What are the foundations of modern management
thinking?

Chapter 2 Learning Dashboard
1. Classical Management Approaches
1. Scientific management
2. Administrative principles
3. Bureaucratic organization
2. Behavioral Management Approaches
1. Follett’s organizations as communities
2. The Hawthorne studies
3. Maslow’s theory of human needs
4. McGregor’s Theory X and Theory Y
5. Argyris’s theory of adult personality

Chapter 2 Learning Dashboard
3. Modern Management Foundations
1. Quantitative analysis and tools
2. Organization as systems
3. Contingency thinking
4. Quality management
5. Knowledge management and organizational learning
6. Evidence-based management

Figure 2.1 Major branches in the classical approach
to management

Takeaway 1: Classical Management Approaches
• Four guiding principles of scientific management
(Frederick Taylor)
1. Develop for every job a “science” that includes rules of
motion, standardized work implements, and proper
working conditions.
2. Carefully select workers with the right abilities for the
job.
3. Carefully train workers to do the job and give them the
proper incentives to cooperate with the job “science.”
4. Support workers by carefully planning their work and
by smoothing the way as they go about their jobs.
6

• Scientific management (the Gilbreths)
– Motion study
• Science of reducing a job or task to its basic physical
motions
– Eliminating wasted motions improves
performance

• Practical lessons from scientific management
– Make results-based compensation a performance
incentive
– Carefully design jobs with efficient work methods
– Carefully select workers with the abilities to do
these jobs
– Train workers to perform jobs to the best of their
abilities
– Train supervisors to support workers so they can
perform jobs to the best of their abilities

• Administrative principles (Henri Fayol) —
rules/duties of management:
Foresight
to complete a
plan of action
for the future
Organization
to provide and
mobilize
resources to
implement the
plan
Command
to lead, select,
and evaluate
workers to get
the best work
toward the
plan
Coordination
to fit diverse
efforts
together and
ensure
information is
shared and
problems
solved
Control
to make sure
things happen
according to
plan and to
take necessary
corrective
action

• Administrative principles (Henri Fayol)
– Scalar chain
• there should be a clear and unbroken line of
communication from the top to the bottom of the
organization
– Unity of command
• each person should receive orders from only one boss
– Unity of direction
• one person should be in charge of all activities with the
same performance objective

• Bureaucratic organization (Max Weber)
– Bureaucracy
• An ideal, intentionally rational, and very efficient form
of organization
• Based on principles of logic,
order, and legitimate
authority

• Characteristics of bureaucratic organizations:
– Clear division of labor
– Clear hierarchy of authority
– Formal rules and procedures
– Impersonality
– Careers based on merit
12

• Possible disadvantages of bureaucracy:
– Excessive paperwork or “red tape”
– Slowness in handling problems
– Rigidity in the face of shifting needs
– Resistance to change
– Employee apathy

Figure 2.2 Foundations in the behavioral or
human resource approaches to management
Human resource
approaches
Assumption:
People are social
and self-
actualizing
Theory of
human needs
Abraham
Maslow
Hawthorne
studies
Elton Mayo
Organizations
as communities
Mary Parker
Follett Theory X and
Theory Y
Douglas
McGregor
Personality and
organization
Chris Argyris

Takeaway 2: Behavioral Management Approaches
• Organizations as communities
– Mary Parker Follett
– Groups and human cooperation:
• Groups allow individuals to combine their talents for a greater
good
• Organizations are cooperating “communities” of managers and
workers
• Manager’s job is to help people cooperate and achieve an
integration of interests

• Organizations as communities
– Forward-looking management insights:
• precursor of employee ownership,
profit sharing, and gain-sharing
Making every
employee an owner
creates a sense of
collective responsibility
• precursor of systems thinking
Business problems
involve a variety of
inter-related factors
• precursor of managerial ethics
and social responsibility
Private profits relative
to public good

• Hawthorne studies
– Initial study examined how economic incentives
and physical conditions affected worker output
– No consistent relationship found
– “Psychological factors” influenced results

• Hawthorne studies (cont.)
– Social setting and human relations
• Manipulated physical work conditions to assess impact
on output
• Designed to minimize the “psychological factors” of
previous experiment
• Mayo and colleagues concluded:
– New “social setting” led workers to do good job
– Good “human relations” = higher productivity

• Hawthorne studies (cont.)
– Employee attitudes and group processes
• Some things satisfied some workers but not others
• People restricted output to adhere to group norms

• Lessons from the Hawthorne Studies:
– Social and human concerns are keys to
productivity
– Hawthorne effect — people who are singled out
for special attention perform as expected

• Maslow’s theory of human needs
– A need is a physiological or psychological
deficiency a person feels compelled to satisfy
– Need levels:
• Physiological
• Safety
• Social
• Esteem
• Self-actualization

Figure 2.3 Maslow’s hierarchy of human needs

• Maslow’s theory of human needs
– Deficit principle
• A satisfied need is not a motivator of behavior
– Progression principle
• A need becomes a motivator once the preceding
lower-level need is satisfied
– Both principles cease to operate at self-
actualization level

• McGregor’s Theory X assumes that workers:
– Dislike work
– Lack ambition
– Are irresponsible
– Resist change
– Prefer to be led

• McGregor’s Theory Y assumes that workers
are:
– Willing to work
– Capable of self control
– Willing to accept responsibility
– Imaginative and creative
– Capable of self-direction

• Implications of Theory X and Theory Y:
– Managers create self-fulfilling prophecies
– Theory X managers create situations where
workers become dependent and reluctant
– Theory Y managers create situations where
workers respond with initiative and high
performance
• Central to notions of empowerment and self-
management

• Argyris’s theory of adult personality
– Classical management principles and practices
inhibit worker maturation and are inconsistent
with the mature adult personality
– Psychological success occurs when people define
own goals

• Argyris’s theory of adult personality
– Management practices should accommodate the
mature personality by:
• Increasing task responsibility
• Increasing task variety
• Using participative decision making

Takeaway 3: Modern Management Foundations
• Foundations for continuing developments in
management
Quantitative analysis and tools
Systems view of organizations
Contingency thinking
Commitment to quality and performance
Knowledge management and learning organizations
Evidence-based management

• Management science or operations research
The scientific
applications of
mathematical
techniques to
management
problems
Value chain
analysis
Supply chain
management
Inventory
management
Quality
control
Queuing
theory
Linear
programming
Network
models

• Quantitative Analysis and Tools
• Analytics – the use of large data bases and
mathematics to solve problems and make informed
decisions using systematic analysis
• Typical quantitative approach to managerial problem-
solving
– Problem encountered, it is systematically analyzed,
appropriate mathematical models and computations
applied, optimal solution identified

• Organizations as Systems
– System
• Collection of interrelated parts that function together
to achieve a common purpose
– Subsystem
• A smaller component of a larger system
– Open systems
• Organizations that interact with their environments in
the continual process of transforming resource inputs
into outputs

Figure 2.4 Organizations as complex networks of
interacting subsystems

• Contingency thinking
– Tries to match managerial responses with
problems and opportunities
unique to different situations
– No “one best way” to manage
– Appropriate way to manage
depends on the situation

• Quality management
– Managers and workers in progressive
organizations are quality conscious
• Quality and competitive advantage are linked
– Total quality management (TQM)
• Comprehensive approach to continuous quality
improvement for a total organization
• Creates context for the value chain

– Continuous improvement
• Continual search for new ways to improve quality
• Something always can and should be improved
– ISO certification
• Global quality benchmark
• Refine and upgrade quality to meet ISO standards

• Knowledge Management and Organizational
Learning
– Knowledge management is the process of using
intellectual capital for competitive advantage
– Portfolio of intellectual assets include patents,
intellectual property rights, trade secrets, and
accumulated knowledge of the entire workforce

• Learning organizations
– Organizations that are able to continually learn
and adapt to new circumstances
– Core ingredients include:
Encourage
learning
Information
sharing
Teamwork Empowerment Participation

• Evidence-Based Management
– Making management decisions on “hard facts”
about what really works

• Evidence-Based Positive Human Resource
Management Practices
– Employment security
– Selective hiring
– Self-managing teams
– High pay based on merit
– Training and development
– Reduced status distinctions
– Shared information

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