The document discusses the evolution of management theory from the classical approach to modern operational management theory. It describes Frederick Taylor's scientific management approach which emphasized efficiency, planning, measurement, and cooperation between management and workers. It also discusses Henri Fayol's general administrative theory which identified the five primary functions of management and proposed 14 principles of management. Many of Taylor's techniques for improving efficiency and Fayol's management principles are still used by managers today in analyzing work tasks, using time-and-motion studies, hiring qualified workers, and designing incentive systems.

1. EVOLUTION OF MANAGEMENT
THEORY

2. Universal Need for Management

8. 8
Traditional Viewpoint
Behavioral Viewpoint
Systems Viewpoint
Contingency Viewpoint
Quality Viewpoint
1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000

9. 9
Goals:
Efficiency
Consistency
 Administrative
Management
 Bureaucratic
Management
 Scientific
Management

10. CLASSICAL APPROACH
• Two major theories comprise
• the classical approach: scientific management
and general administrative theory.

11. Taylor's Scientific Management (USA
1856-1915):
•
• Started as an apprentice machinist in Philadelphia, USA. He rose to be the
chief engineer at the Midvale Engineering Works and later on served with
the Bethlehem Works where he experimented with his ideas and made
the contribution to the management theory for which he is so well known.
• Frederick Winslow Taylor well-known as the founder of scientific
management was the first to recognize and emphasis the need for
adopting a scientific approach to the task of managing an enterprise.
• He tried to diagnose the causes of low efficiency in industry and came to
the conclusion that much of waste and inefficiency is due to the lack of
order and system in the methods of management. He found that the
management was usually ignorant of the amount of work that could be
done by a worker in a day as also the best method of doing the job. As a
result, it remained largely at the mercy of the workers who deliberately
shirked work.
• He therefore, suggested that those responsible for management should
adopt a scientific approach in their work, and make use of "scientific
method" for achieving higher efficiency.

12. • The scientific method consists essentially of
• (a) Observation
• (b) Measurement
• (c) Experimentation and
• (d) Inference.
• He advocated a thorough planning of the job by the management and
emphasized the necessity of perfect understanding and co-operation
between the management and the workers both for the enlargement of
profits and the use of scientific investigation and knowledge in industrial
work. He summed up his approach in these words:
• Science, not rule of thumb
• Harmony, not discord
• Co-operation, not individualism
• Maximum output, in place of restricted output
• The development of each man to his greatest efficiency and prosperity.

13. Taylor’- scientific management:
• 1.Develop a science for each element of an individual’s
work to replace the old rule-of-thumb method.
• 2. Scientifically select and then train, teach, and
develop the worker.
• 3. Heartily cooperate with the workers so as to ensure
that all work is done in accordance with the principles
of the science that has been developed.
• 4. Divide work and responsibility almost equally
between management and workers. Management does
all work for which it is better suited than the workers.

14. 14

15. Probably the best known example of Taylor’s scientific management efforts was
the pig iron experiment. Workers loaded “pigs” of iron (each weighing 92 lbs.)
onto rail cars. Their daily average output was 12.5 tons. However, Taylor believed
that by scientifically analyzing the job to determine the “one best way” to load
pig iron, output could be increased to 47 or 48 tons per day. After scientifically
applying different combinations of procedures, techniques, and tools, Taylor
succeeded in getting that level of productivity.
How?
By putting the right person on the job with the correct tools and equipment,
having the worker follow his instructions exactly, and motivating the worker with
an economic incentive of a significantly higher daily wage.
Using similar approaches for other jobs, Taylor was able to define the “one best
way” for doing each job. Overall, Taylor achieved consistent productivity
improvements in the range of 200 percent or more.
Based on his ground breaking studies of manual work using scientific principles,
Taylor became known as the “father” of scientific management. His ideas spread
in the United States and toother countries and inspired others to study and
develop methods of scientific management. His most prominent followers were
Frank and Lillian Gilbreth.

16. • A construction contractor by trade, Frank Gilbreth gave up that career to study
scientific management after hearing Taylor speak at a professional meeting.
• Frankz and his wife Lillian, a psychologist, studied work to eliminate inefficient
hand-and body motions. The Gilbreths also experimented with the design and use
of the proper tools and equipment for optimizing work performance.4 Also, as
parents of 12 children, the Gilbreths ran their household using scientific
management principles and techniques. In fact, two of their children wrote a book,
Cheaper by the Dozen, which described life with the two masters of efficiency.
• Frank is probably best known for his bricklaying experiments. By carefully analyzing
the bricklayer’s job, he reduced the number of motions in laying exterior brick
from 18 to about 5, and in laying interior brick from 18 to 2. Using Gilbreth’s
techniques, a bricklayer was more productive and less fatigued at the end of the
day.
• The Gilbreths invented a device called a microchronometer that recorded a
worker’s hand-and-body motions and the amount of time spent doing each
motion. Wasted motions missed by the naked eye could be identified and
eliminated.
• The Gilbreths also devised a classification scheme to label 17 basic hand motions
(such as search, grasp, hold), which they called therbligs (Gilbreth spelled
backward with the th transposed). This scheme gave the Gilbreths a more precise
way of analyzing a worker’s exact hand movements.

17. How today’s managers use scientific
management
• Many of the guidelines and techniques that
Taylor and the Gilbreths devised for improving
production efficiency are still used in
organizations today.
• When managers analyze the basic work tasks
that must be performed, use time-and-motion
study to eliminate wasted motions, hire the
best-qualified workers for a job, or design
incentive systems based on output, they’re
using the principles of scientific management.

18. General administrative theory
• focused more on what managers do and what constituted good
management practice.
• We introduced Henri Fayol in Chapter 1 because he first identified
five functions that managers perform: planning, organizing,
commanding, coordinating, and controlling.Fayol wrote during the
same time period as Taylor.
• While Taylor was concerned with first-line managers and the
scientific method, Fayol’s attention was directed at the activities of
all managers. He wrote from his personal experience as the
managing director of a large French coal-mining firm.
• Fayol described the practice of management as something distinct
from accounting, finance, production, distribution, and other typical
business functions. His belief that management was an activity
common to all business endeavors, government, and even the
home led him to develop 14 principles of management—
fundamental rules of management that could be applied to all
organizational situations and taught in schools.

19. 19
Fourteen
Principles of
Management
given by
Henry Fayol

20. Modern Operational Management Theory
14 Principles of Henri Fayol
 DIVISION OF WORK OR SPECIALIZATION
 AUTHORITY AND RESPONSIBILITY
 DISCIPLINE
 UNITY OF COMMAND
 UNITY OF DIRECTION
 SUBORDINATION OF INDIVIDUAL TO GENERAL
 REMUNERATION
 CENTRALIZATION
 LINE OF COMMAND/SCALAR CHAIN
 ORDER
 EQUITY
 STABILITY OF TENURE
 INITIATIVE
 ESPRIT DE CORPS

21. Henry Fayol's 14 Principles of Management:
• The principles of management are given below:
• 1. Division of work: Division of work or specialization alone can give maximum productivity and
efficiency. Both technical and managerial activities can be performed in the best manner only
through division of labour and specialization.
• 2. Authority and Responsibility: The right to give order is called authority. The obligation to
accomplish is called responsibility. Authority and Responsibility are the two sides of the
management coin. They exist together. They are complementary and mutually interdependent.
• 3. Discipline: The objectives, rules and regulations, the policies and procedures must be honoured
by each member of an organization. There must be clear and fair agreement on the rules and
objectives, on the policies and procedures. There must be penalties (punishment) for non-obedience
or indiscipline. No organization can work smoothly without discipline – preferably voluntary
discipline.
• 4. Unity of Command: In order to avoid any possible confusion and conflict, each member of an
organization must received orders and instructions only from one superior (boss).
• 5. Unity of Direction: All members of an organization must work together to accomplish common
objectives.
• 6. Emphasis on Subordination of Personal Interest to General or Common Interest: This is also
called principle of co-operation. Each shall work for all and all for each. General or common interest
must be supreme in any joint enterprise.
• 7. Remuneration: Fair pay with non-financial rewards can act as the best incentive or motivator for
good performance. Exploitation of employees in any manner must be eliminated. Sound scheme of
remuneration includes adequate financial and nonfinancial incentives.

22. • 8. Centralization: There must be a good balance between centralization and
decentralization of authority and power. Extreme centralization and decentralization must be
avoided.
• 9. Scalar Chain: The unity of command brings about a chain or hierarchy of command
linking all members of the organization from the top to the bottom. Scalar denotes steps.
• 10. Order: Fayol suggested that there is a place for everything. Order or system alone can
create a sound organization and efficient management.
• 11. Equity: An organization consists of a group of people involved in joint effort. Hence,
equity (i.e., justice) must be there. Without equity, we cannot have sustained and adequate
joint collaboration.
• 12. Stability of Tenure: A person needs time to adjust himself with the new work and
demonstrate efficiency in due course. Hence, employees and managers must have job
security. Security of income and employment is a pre-requisite of sound organization and
management.
• 13. Esprit of Co-operation: Esprit de corps is the foundation of a sound organization. Union
is strength. But unity demands co-operation. Pride, loyalty and sense of belonging are
responsible for good performance.
• 14. Initiative: Creative thinking and capacity to take initiative can give us sound managerial
planning and execution of predetermined plans.

23. 1. DIVISION OF WORK or SPECIALIZATION
• Division of work makes a man specialist. The reason is that division of work
helps to specialize in an activity which increases the output with perfection. It
also avoids wastage of time. Division can be applied to both technical and
managerial kind of work.
• Work should be divided among individuals and groups to ensure that effort and
attention are focused on special portions of the task. Fayol presented work
specialization as the best way to use the human resources of the organization.
• Specialization allows the individual
to build up experience,
and to continuously improve
his skills. Thereby he can be more
productive.

25. Authority & Responsibility.
• Managers must be able to give orders.
Authority gives them this right. Note that
responsibility arises wherever authority is
exercised.
• The right to issue commands, along with
which must go the balanced responsibility for
its function.

27. 3. Discipline
• Employees must obey and respect the rules
that govern the organization.
• Employees must obey,
but this is two-sided:
employees will only obey
orders if management
play their part by providing
good leadership.

28. • 4. Unity Of Command
• Every employee should receive orders from
only one superior.
• Each worker should
have only one
boss with no
other conflicting
lines of command.

30. • 5. Unity of direction.
• Each group of organizational activities that have the same
objective should be directed by one manager using one plan.
• People engaged in the same kind of activities must
have the same objectives in a single plan. This is
essential to ensure unity and coordination in the
enterprise. Unity of command does not exist without
unity of direction but does not necessarily flows from
it.

32. • The individual should subordinate self-interest to the general
good. It is incumbent upon management to reduce conflict
between the individual and the general well being wherever
possible.
• Management must see that the goals of the firms are always
paramount.
6. Subordination of individual interest

34. 7.Remuneration
• Workers must be paid a fair wage for their services.
 Means the wages and salaries paid to employee. It should be fair & must be paid on
time.
 It satisfy both employee & employer
 It should be decided on-Work allotted.
 cost of living.
• Payment is an important motivator although by analyzing a number of possibilities,
Fayol points out that there is no such thing as a perfect system

36. 8. Centralization (Or Decentralization)
• Fayol thought centralization of authority to be
desirable, at least for overall control. Certainly, both
formulation of policy and the generation of basic rules
and procedures ought to be centralized
• This is a matter of degree depending on the condition
of the business and the quality of its personnel.

38. 9.Scalar chain
• The line of authority from top management
to the lowest ranks represents the scalar
chain. Communications should follow this
chain.

39. 9. Scalar chain (Line of Authority)
• A hierarchy is necessary for unity of
direction. But lateral communication is also
fundamental, as long as superiors know that
such communication is taking place.
• Scalar chain refers to the number of levels in
the hierarchy from the ultimate authority to
the lowest level in the organization. It should
not be over-stretched and consist of too-many
levels

41. 10.Order
• People and materials should be in the right place at the right time.
• Both material order and social order are necessary. The former minimizes
lost time and useless handling of materials. The latter is achieved through
organization and selection.

43. 11. Equity
• Managers should be kind and fair to their subordinates.
• In running a business a ‘combination of kindliness and justice’
is needed. Treating employees well is important to achieve
equity.

45. 12.Stability of tenure of personnel
• High employee turnover is inefficient. Management should
provide orderly personnel planning and ensure that
replacements are available to fill vacancies.
• Employees work better if job security and career progress are
assured to them. An insecure tenure and a high rate of
employee turnover will affect the organization adversely.

47. 13. Initiative.
• The power of thinking out, proposing and executing. Management should
encourage employees to originate and carry out plans
• Allowing all personnel to show their initiative in some way is a source of
strength for the organization. Even though it may well involve a sacrifice of
‘personal vanity’ on the part of many managers.

49. 14.Esprit de corps
• It means that create a team spirit or union is strength.
• Developed an atmosphere of mutual trust and understanding.
• Create a sense of belonging employees
• It bring a loyalty, dedication and commitment to the group.
• Management must foster the morale of its employees. He further suggests that: “real talent is needed to
coordinate effort, encourage keenness, use each person’s abilities, and reward each one’s merit without
arousing possible jealousies and disturbing harmonious relations.”

51. • Weber (pronounced VAY-ber) was a German sociologist who
studied organizations. in the early 1900s, he developed a theory of
authority structures and relations based on an ideal type of
organization he called a bureaucracy—a form of organization
characterized by division of labor, a clearly defined hierarchy,
detailed rules and regulations, and impersonal relationships.
• Weber recognized that this “ideal bureaucracy” didn’t exist in
reality. Instead he intended it as a basis for theorizing about how
work could be done in large groups.
• His theory became the structural design for many of today’s large
organizations. Bureaucracy, as described by Weber, is a lot like
scientific management in its ideology. Both emphasized rationality,
predictability, impersonality, technical competence, and
authoritarianism.
• Although Weber’s ideas were less practical than Taylor’s, the fact
that his “ideal type” still describes many contemporary
organizations attests to their importance.

52. • Weber’s bureaucracy was an attempt to formulate an
ideal prototype for organizations. Although many
characteristics of Weber’s bureaucracy are still evident
in large organizations, his model isn’t as popular today
as it was in the twentieth century.
• Many managers feel that a bureaucratic structure
hinders individual employees’ creativity and limits an
organization’s ability to respond quickly to an
increasingly dynamic environment.
• However, even in flexible organizations of creative
professionals—such as Microsoft, Samsung, General
Electric, or Cisco Systems—some bureaucratic
mechanisms are necessary to ensure that resources are
used efficiently and effectively.

53. 53
 Rules—formal guidelines for the behavior of employees on the
job
 Impersonality—employees are evaluated according to
rules and objective data
 Division of Labor—splitting work into specialized positions

54. A Bureaucracy
should have
Division of labor
Authority Hierarcy
Formal selection
Formal rules and
regulations
Impersonality
Career Orientation
Jobs broken down
into simple, routine,
and well-defined
tasks
Managers are career
professionals, not
owners of units they
manage
Positions organized
in a hierarchy with
a clear chain
of command
Uniform application
of rules and
controls,
not according to
personalities System of written
rules and standard
operating
procedures
People selected for
jobs based on
technical
qualifications
Characteristics of
Weber's Bureaucracy

55. Behavioral Approach
• Managers get things done by working with
people. This explains why some writers have
chosen to look at management by focusing on
the organization’s people. The field of study that
researches the actions (behavior) of people at
work is called organizational behavior (OB).
• Much of what managers do today when
managing people—motivating, leading, building
trust, working with a team, managing conflict,
and so forth—has come out of OB research.

56. 56
 Focuses on dealing effectively with the
human aspects of organizations
 Started in the 1930’s
 Emphasis on working conditions
 Workers wanted respect
 Workers formed unions to bargain
with management

57. Early Advocates
of OB
Robert Owen
Late 1700s
Hugo Munsterberg
Early 1900s
Mary Parker Follett
Early 1900s
Chester Barnard
1930s
•Concerned about deplorable working
conditions
•Proposed idealistic workplace
•Argued that money spent improving
labor was smart investment
•Actual manager who thought
organizations were social systems that
required cooperation
•Believed manager’s job was to
communicate and stimulate
employees’ high levels of effort
•First to argue that organizations were
open systems
•One of the first to recognize that
organizations could be viewed from
perspective of individual and group behavior
•Proposed more people-oriented ideas than
scientific management followers
•Thought organizations should be based on
group ethic
•Pioneer in field of industrial psychology—
scientific study of people at work
•Suggested using psychological tests for
employee selection, learning theory
concepts for employee training, and study
of human behavior for employee
motivation

58. Behavioral Theory on How Employees
Behave Toward Work
Theory X Assumptions:
– Employees dislike work.
– Employees are irresponsible.
– Employees lack ambition.
– Employees resist change.

59. Another Theory on How Employees
Behave
Theory Y Assumptions:
– Employees are willing to work.
– Employees are self directed.
– They accept responsibility.
– Employees are creative.
– They are self-controlled.

60. Theory X (Classical):
People dislike work and
prefer to be directed
Must be coerced to
work
Want to avoid
responsibility and
have little ambition
Want security above
everything
Theory Y (Human
Resources):
People will accept
responsibility
Have intellect that could
be applied to
organizational goals
Only partially use their
intellectual potential.

61. How today’s managers use the
behavioral approach
• The behavioral approach has largely shaped how
today’s organizations are managed. From the way that
managers design jobs to the way that they work with
employee teams to the way that they communicate,
we see elements of the behavioral approach.
• Much of what the early OB advocates proposed and
the conclusions from the Hawthorne studies have
provided the foundation for our current theories of
motivation, leadership, group behavior and
development, and numerous other behavioral
approaches.

62. Quantitative Approach
• Based on research in space time geometry,
one airline innovated a unique boarding
process called “reverse pyramid” that has
saved at least 2 minutes in boarding time. This
is an example of the quantitative approach,
which is the use of quantitative techniques to
improve decision making. This approach also
is known as management science.

63. c) THE QUANTITATIVE APPROACH:
• The quantitative approach focuses on improving decision making via the application of
quantitative techniques. Its roots can be traced back to scientific management.
• (i) Management Science (Operations Research):
• Management science (also called operations research) uses mathematical and statistical
approaches to solve management problems. It developed during World War II as strategists
tried to apply scientific knowledge and methods to the complex problems of war. Industry
began to apply management science after the war. The advent of the computer made many
management science tools and concepts more practical for industry
• (ii) Production And Operations Management:
• This approach focuses on the operation and control of the production process that
transforms resources into finished goods and services. It has its roots in scientific
management but became an identifiable area of management study after World War II. It
uses many of the tools of management science.
• Operations management emphasizes productivity and quality of both manufacturing and
service organizations. W. Edwards Deming exerted a tremendous influence in shaping modern
ideas about improving productivity and quality.
• Major areas of study within operations management include capacity planning, facilities
location, facilities layout, materials requirement planning, scheduling, purchasing and
inventory control, quality control, computer integrated manufacturing, just-in-time inventory
systems, and flexible manufacturing systems.

64. • Each of these is an example of quantitative techniques being applied to improve managerial
decision making. Another area where quantitative techniques are used frequently is in total
quality management.
• How today’s managers use the quantitative approach
• No one likes long lines, especially residents of New York City. If they see a long checkout line,
they often go somewhere else. And customers are finding that their wait times are shorter
than expected. The science of keeping lines moving is known as queue management.
• The quantitative approach contributes directly to management decision making in the areas
of planning and control. For instance, when managers make budgeting, queuing, scheduling,
quality control, and similar decisions, they typically rely on quantitative techniques.
Specialized software has made the use of these techniques less intimidating for managers,
although many still feel anxious about using them.
• A quality revolution swept through both the business and public sectors in the 1980s and
1990s. It was inspired by a small group of quality experts, the most famous being W. Edwards
Deming (pictured at right) and Joseph M. Juran. The ideas and techniques they advocated in
the 1950s had few supporters in the United States but were enthusiastically embraced by
Japanese organizations. As Japanese manufacturers began beating U.S. competitors in quality
comparisons, however, Western managers soon took a more serious look at Deming’s and
Juran’s ideas . . . ideas that became the basis for today’s quality management programs.
• Total quality management, or TQM, is a management philosophy devoted to continual
improvement and responding to customer needs and expectations., The term customer
includes anyone who interacts with the organization’s product or services internally or
externally.

65. • 1.Intense focus on the customer. The customer includes outsiders who buy the
organization’s products or services and internal customers who interact with and serve
others in the organization.
• 2. Concern for continual improvement. Quality management is a commitment to never
being satisfied. “Very good” is not good enough. Quality can always be improved.
• 3. Process focused. Quality management focuses on work processes as the quality of goods
and services is continually improved.
• 4. Improvement in the quality of everything the organization does. This relates to the final
product, how the organization handles deliveries, how rapidly it responds to complaints, how
politely the phones are answered, and the like.
• 5. Accurate measurement. Quality management uses statistical techniques to measure every
critical variable in the organization’s operations. These are compared against standards to
identify problems, trace them to their roots, and eliminate their causes.
• 6. Empowerment of employees. Quality management involves the people on the line in the
improvement process. Teams are widely used in quality management programs as
empowerment vehicles for finding and solving problems.

66. Contemporary Approaches
• Most of these earlier approaches focused on
managers’ concerns inside the organization.
Starting in the 1960s, management
researchers began to look at what was
happening in the external environment
outside the boundaries of the organization.
• Two contemporary management
perspectives—systems and contingency—
are part of this approach.

67. Systems theory
• Systems theory is a basic theory in the physical
sciences, but had never been applied to
organized human efforts. In 1938, Chester
Barnard, a telephone company executive, first
wrote in his book, The Functions of an Executive,
that an organization functioned as a cooperative
system.
• However, it wasn’t until the 1960s that
management researchers began to look more
carefully at systems theory and how it related to
organizations.

68. SYSTEM APPROACH
• The system approach to management views the organizations as a unified,
purposeful system composed of integral parts. This approach gives managers A
way of looking at the organization as a hole and as a part of the larger external
environment.
• Systems theory tells us that the activity of any segment of an organization affects ,in
varying degree the activity of every other segment.
• Production managers in a manufacturing plant, for example ,prefer long
uninterrupted production runs of standardized products in order to maintain
maximum efficiency and low costs.
• Marketing managers on the other hand who want to offer customers quick
delivery of a wide range of products would like a flexible manufacturing schedule
that can fill special order on short notice.
• Systems oriented production managers make scheduling decisions only after they
have identified the impact of these decisions on other department and on the
entire organization.
• The point of system approach is that managers cannot wholly with in the traditional
organization chart.
• They must mesh their department with the whole enterprise.
• To do that they have to communicate not only with other employees and
departments, but frequently with representative of other organization as well.
• Clearly ,systems managers grasp the importance of the webs of business relationship
to their efforts.

69. • A system is a set of interrelated and
interdependent parts arranged in a manner
that produces a unified whole. The two basic
types of systems are closed and open.
• Closed systems are not influenced by and do
not interact with their environment.
• In contrast, open systems are influenced by
and do interact with their environment.

70. • How does the systems approach contribute to our understanding of
management?
Researchers envisioned an organization as being made up
of “interdependent factors, including individuals, groups, attitudes,
motives, formal structure, interactions, goals, status, and authority.”
• What this means is that as managers coordinate work activities in
the various parts of the organization, they ensure that all these
parts are working together so the organization’s goals can be
achieved.
• For example, the systems approach recognizes that, no matter how
efficient the production department might be, the marketing
department must anticipate changes in customer tastes and work
with the product development department in creating products
customers want or the organization’s overall performance will
suffer.

71. • In addition, the systems approach implies that decisions and actions
in one organizational area will affect other areas. For example, if the
purchasing department doesn’t acquire the right quantity and
quality of inputs, the production department won’t be able to do its
job.
• Finally, the systems approach recognizes that organizations are not
self-contained. They rely on their environment for essential inputs
and as outlets to absorb their outputs. No organization can survive
for long if it ignores government regulations, supplier relations, or
the varied external constituencies upon which it depends.
• How relevant is the systems approach to management?
Quite relevant. Consider, for example, a shift manager at a
Starbucks restaurant who must coordinate the work of employees
filling customer orders at the front counter and the drive-through
windows, direct the delivery and unloading of food supplies, and
address any customer concerns that come up. This manager
“manages” all parts of the “system” so that the restaurant meets its
daily sales goals.

73. Environment
Employees’ Work
Activities
Management
Activities
Technology and
Operations
Methods
Raw Materials
Human
Resources
Capital
Technology
Information
Products and
Services
Financial
Results
Information
Human Results
Inputs Outputs
Transformation Process
organization
feedback
Environment

74. The early management theorists came up with management principles that they
generally assumed to be universally applicable. Later research found exceptions to
many of these principles. For example, division of labor is valuable and widely
used, but jobs can become too specialized. Bureaucracy is desirable in many
situations, but in other circumstances, other structural designs are more effective.
Management is not (and cannot be) based on simplistic principles to be applied in all
situations. Different and changing situations require managers to use different
approaches and techniques. The contingency approach (sometimes called the
situational approach) says that organizations are different, face different
situations (contingencies), and require different ways of managing.
A good way to describe contingency is “if, then.” If this is the way my situation is, then
this is the best way for me to manage in this situation. It’s intuitively logical
because organizations and even units within the same organization differ—in size,
goals, work activities, and the like. It would be surprising to find universally
applicable management rules that would work in all situations. But, of course, it’s
one thing to say that the way to manage “depends on the situation” and another
to say what the situation is.
Management researchers continue working to identify these situational variables.
Exhibit MH-8 describes four popular contingency variables. Although the list is by
no means comprehensive—more than 100 different variables have been
identified—it represents those most widely used and gives you an idea of what we
mean by the term contingency variable. The primary value of the contingency
approach is that it stresses there are no simplistic or universal rules for managers
to follow.

75. • Organization Size. As size increases, so do the problems of coordination.
For instance, the type of organization structure appropriate for an
organization of 50,000 employees is likely to be inefficient for an
organization of 50 employees.
• Routineness of Task Technology. To achieve its purpose, an organization
uses technology. Routine technologies require organizational structures,
leadership styles, and control systems that differ from those required by
customized or non-routine technologies.
• Environmental Uncertainty. The degree of uncertainty caused by
environmental changes influences the management process. What works
best in a stable and predictable environment may be totally inappropriate
in a rapidly changing and unpredictable environment.
• Individual Differences. Individuals differ in terms of their desire for
growth, autonomy, tolerance of ambiguity, and expectations. These and
other individual differences are particularly important when managers
select motivation techniques, leadership styles, and job designs.

76. So what do managers face today when managing?
Although the dawn of the information age is said to have
begun with Samuel Morse’s telegraph in 1837, the most dramatic
changes in information technology have occurred in the latter part
of the twentieth century and have directly affected the manager’s
job.
Managers now may manage employees who are working from
home or working halfway around the world. An organization’s
computing resources used to be mainframe computers locked away
in temperature-controlled rooms and only accessed by the experts.
Now, practically everyone in an organization is connected—wired or
wireless—with devices no larger than the palm of the hand.
Just like the impact of the Industrial Revolution in the 1700s on
the emergence of management, the information age has brought
dramatic changes that continue to influence the way organizations
are managed.

77. MANAGEMENT
APPROACHS
Beginning Dates Emphasis
CLASSICAL APPROACH
Scientific
Management
1880s Traditional rules of thumb are replaced by
precise procedures developed after careful
study of an individual at work.
Administrative
Management
1940s Gives idea about the primary functions of
management and the 14 Principles of
Administration
Bureaucratic
Management
1920s Replaces traditional leadership and
charismatic leadership with legal leadership
BEHAVIORAL APPROACH
Human
Relations
1930s Workers' attitudes are associated with
productivity
Behavioral
Science
1950s Gives idea to understand human behavior in
the organization.

78. QUANTITATIVE APPROACH
Management
Science (Operation
research)
1940s Uses mathematical and statistical approaches
to solve management problems.
Production
and Operations
Management
1940s This approach focuses on the operation and
control of the production process that
transforms resources into finished goods and
services
RECENT DEVELOPMENTS
SYSTEMS
APPROACH
1950s Considers the organization as a system that
transforms inputs into outputs while in
constant interaction with its' environment.
CONTINGENCY
APPROACH
1960s Applies management principles and processes
as dictated by the unique characteristics of
each situation.