This document summarizes the evolution of management theory from scientific management to modern theories. It discusses early theories like scientific management and administrative management. It then covers behavioral, management science, and organizational environment theories. Key contributors and concepts are outlined for each theoretical approach. In total, the document provides a high-level overview of the major developments in management theory from the 19th century to present day.

1. MN 1020
Assignment 1
Name: Thushan Dharmawardana
Index no: 101414G
Submission date: 01/09/2011

2. The Evolution of Management Theory
It was an era where so many alterations in the world Economy took place. In the closing decades
of the 19th century there was a quest of seeking innovative ways to increase organizational
efficiency and effectiveness. The Scientific Management Theory initiated on the basis of that. In
this period of time crafts production was substituted by large factories in which a lot of technical
revolutions have been taking place. The owners and managers were not capable of coping to
these challenges therefore they hunted for advanced techniques to overcome this situation. As a
solution the concepts of Job Specialization and division of labour came about. In this scenario
workers who specialized in their respective tasks became more skilled.
The Scientific Management Theory
Fredrick W. Taylor was the architecture of the concept Scientific Management, “The systematic
study of relationships between people and tasks for the purpose of redesigning the work process
to increase efficiency”. It was believed that the most effective and efficient division of labour
could best be determined by the concept of Scientific Management. There were four core
principles in this concept.
Investigation and experimentation on organization performance
Codification of new methods/standards
Selection of employees according to codified standards
Establishing a level of performance and a pay system with rewards
101414G Page 1

3. In 1910 most of the organizations were using this concept but selectively. Even though there
was an increase in performance some disputes about this concept lead to an increase in trade
union involvement. There were some major issues in this concept.
Availability of fewer jobs
Job dissatisfaction
Distrust among employees and employers.
Some organizations redesigned the principles according to their vision. For example introduction
of moving conveyer belts in Henry Ford’s factory can be taken in to consideration. However
these approaches were not able to solve the emerged issues. Nevertheless Taylor’s work had a
lasting effect on management production systems.
Frank Gilbreth and Lillian Gilbreth who were the successors of Taylor studied how the working
environment influences the performance of the employees. They made a heavy contribution in
time-and-motion study. They demonstrated that by following arrangements organizations can
solve their issues effectively.
 Breaking up each job action into its components.
 Finding better ways to perform the action.
 Reorganizing each job action to be more efficient
Administrative Management Theory
Researchers attempted to discover how to create an organizational structure that leads to high
efficiency and effectiveness. Theory of Bureaucracy was developed by Max Weber as a
succession of these researches. Bureaucracy is basically a formal system of organization and
administration designed to ensure efficiency and effectiveness. There were several principles in
this theory.
101414G Page 2

4. Division of
Labour
Career Authority
Orientation Hierachy
Bureaucracy
should have
Formal
Impersonality
Selection
Formal Rules
and
regulations
Weber identified several factors there should be in a bureaucracy system. Simultaneously Henry
Fayol identified 14 principles that should be vital to increasing the efficiency of the management
process according to his perspective.
These studies of Fayol and Weber laid the foundation of modern management theory.
Behavioural Management Theory
This is the study of how managers should behave in order to motivate employees and encourage
them to strive towards high levels of performance as an organization. In the previous theory there
wasn’t a major concern about the employee viewpoint. Thus Mary Farker Follett explained why
it is important to think about the human side of management.
According to the studies of Follett managers should behave as coaches and facilitators –not as
monitors and supervisors and the importance of direct inter communication between managers of
different departments to make speedy decisions. She also promoted the concept of “cross
functioning” which has been used in a great scale at present.
Hawthorne effect is the discovery that a manager’s behaviour and leadership approach can
affect the level of performance of employees. From this study emerged the concept of human
relations movement. It is basically how the supervisors should be behaviourally trained to spice
up worker’s motivation, cooperation and increase their productivity.Informal organization is
one of the implications of Hawthorne effect. This is the system of behavioural rules and norms
that come out in a group. The study of factors that have an impact on how individuals and groups
react to in organizations has been identified as the organizational behaviour.
101414G Page 3

5. Apart from these mentioned here the most significant approach was developed by Douglas
McGregor. He supposed two different sets of assumptions which were named as Theory X and
Theory Y.
Theory X Theory Y
people people
Dislike work like to work
need force to
Can be self
make them
disciplined
work
like to be will accept
directed responsibility
motivated motivated
mainly by under right
money conditions
little highly
creativity creative
Management Science Theory
This is a modern extension of Scientific Management Theory in this approach describes how
precise quantitative techniques can be used in order to make the best use of organizational
resources.
101414G Page 4

6. Quantitative
Management
Management Management
Operations
Information Science
Management
Systems Theory
Total Quality
Management
Quantitative management emphasises on how arithmetic can be manipulated to achieve best
practises in inventory and financial capital control.
Operations management presents a set of techniques that can be utilized to improve production
efficiency
Total quality management focuses on the art of how the whole can be managed to achieve
excellence.
Management information systems provide the managers with adequate information about
internal and external events of an organization to effective decision making.
Organizational Environment Theory
This is the set of conditions and forces that functions externally to the organization but affect a
manger’s capability to acquire and utilize resources. This clearly stresses on how important it is
to study the environment.
The open systems theory and contingency theory developed in 1960 ascertains the importance of
the importance of studying the environment.
The Open –Systems View
This is a system where external resources are acquired and converted into goods and services
then sent back to customers for purchasing. And the cycle carries on. This system is considered
101414G Page 5

7. as an open system. Organizations which use a closed system are likely to experience entropy,
the tendency of a system to lose its ability to control itself and thus to dissolve and collapse.
Contigency Theory
It discloses that there is no best way to organize therefore characteristics of the environment
affect an organization’s ability to obtain resources.
Types of structures
Above describes the differences between the structures. In conclusion managers in a Mechanistic
structure can obtain inputs at a lower cost preferably in a stable environment and managers in an
organic environment can react more quickly in a rapidly changing environment.
These contributions constructed the foundation of modern management theories.
References: Contemporary Management fifth edition
Gareth R. Jones, Texas A & M University -- College Station
Jennifer M. George, Rice University
101414G Page 6