Classical management theory evolved in the 19th century during the industrial revolution to establish management's role in organizations. It is based on three main theories: scientific management which focused on analyzing work scientifically to maximize efficiency; bureaucratic management which advocated for clear lines of authority and rules; and administrative management which viewed management as a process of coordinating groups. The theory emphasizes economic efficiency and views employees as motivated primarily by monetary incentives. However, it is criticized for making untested assumptions and treating employees as parts of a machine rather than individuals.