1. Management theory has evolved over time from agrarian societies through the industrial era to modern post-industrial societies. Early theories focused on hierarchical structures and scientific approaches to work. 2. Later theories incorporated human factors, recognizing the importance of employee satisfaction and informal social structures within organizations. Contingency theory emerged, asserting there is no single best approach and management must adapt to each organization's unique circumstances. 3. Current approaches include applying quantitative techniques to decision making, viewing the organization and its subsystems as part of a larger environmental system, and tailoring leadership styles to different situations. The evolution of management theory continues to incorporate new technological and social developments.

1. 1
Evolution of
Management and
Organizational Theory
Agrarian
Prescientific
Classical
Industrial
Neoclassical
Modern
Post Industrial

2. 2
Pre-Industrial Societies
• Biased against management
– Ruling class perceived work,
commerce, and trade as
undignified
– Work was done by slaves
Individuals were bound to their
stations for life
• Rules were not questions
• Profit making was not favorably
viewed by the ruling class
• Money should be made by
conquering

3. 3
Management Theory
during Pre-Industrial
Societies
• Sporadic, Widely scattered
• Span of Control discussed by
Egyptians
• Socrates discussed leadership
• Plato described work
specialization

4. 4
Agrarian
• Farm/home was the focus of the
work
• Followed in the footsteps of
parent
• Craftwork was prevalent
• Land meant wealth

5. 5
Classical Management
• Needed due to Industrial
Revolution
– Two stages of industrialization
• Development of an industrial
infrastructure
– Nationwide Transportation System
– Source of cheap power
– Technological innovations
– Modern Communications
– Networked Financial Institutions
– Educated Labor Force
• Creation of capital goods sector

6. 6
Administrative Theory
• Henri Fayol (Five Functions of
Management):
– Division of Work
– Authority and Responsibility
– Unity of Command
– Renumeration
– Espirit de Corps
• Much of knowledge of
organizational structure came
from this theory

7. 7
Scientific Management
• Four basic tenets (Frederick
Taylor):
– Develop one best way to do each
job
– Select the best individual for the
position
– Ensure the work is carried out in
prescribed fashion (training and
increased wages as the carrot).
– Divide work among employees so
that activities such as planning,
organizing, and controlling are the
prime responsibilities of managers

8. 8
Structuralist School
• Ideal Organization (Max
Weber), the Bureaucracy:
– Rules and procedures control
organizational function
– High degree of differentiation
exists between function
– Hierarchy used for reporting
– Rules and norms regulate
behavior
– Ownership and administration are
separate
– Administrative acts are recorded
in writing

9. 9
Neoclassical Theory
• Pointed out harmful effects of
trying to standardize people
• Studies showed the impact co-
workers (rather than economic
incentives) could have on
productivity
• Social considerations began
receiving attention
• Management must help satisfy
needs and desires
– Two sources - Sociologists (Human
Relations) and psychologists
(Behavioral)

10. 10
Human Relations School
• Hawthorne Experiments
– Regardless what the researchers
did, productivity went up
– High morale was noticed
– Informal organization important
• First work that put the human
factor at the center of their work

11. 11
Behavioral School
• Bases for education today
• Human behavior based on
orientation to personal growth,
accomplishment, and inner
development
• Jobs must provide the
opportunity to develop
themselves

12. 12
Post-Industrial Society
• Characterized by:
– Basic shift in orientation from goods-
producing to sevices-rendering /
information-processing
– Gradual and steady rise in the influence
of professional and technical
occupations
– Growing influence and centrality of
theoretical knowledge as source of
innovation and policy formation for
society
– Increased need for planning and control
of technology and its growth
– Emergence of integrated computer
systems to create new intellectual
technology

13. 13
Post-Industrial Pressures
• Growing Global Competition
• Increased Governmental
Regulations dealing with Social
Controversies
• Resource Scarcity
• Increased labor-force diversity
• Changing cultural norms
• Supply-demand pressures

14. 14
Recent Development in
Managerial Theory
• Emergence of Management
Science and Operations
Research in decision making
• Development of Systems
Theory (total environment)
• Contingency Theory
• Growing influence of
Organizational Behavior

15. 15
Management Science
• Applying quantitative
techniques to management and
organizational problems
• Started with logistical problems
associated with WWII
• New technologies continue to
demonstrate the need to
consider social and
organizational aspects

16. 16
Systems Theory
• Subsystems include:
– Task/Technological subsystem
• Basic work of organization
– Administrative/Structural
Subsystem
• Formal organization
– Subsystem of Individuals
• Their knowledge, skills, attitudes,
values, expectations, perceptions
– Emergent Subsystem
• Implicit arrangements, group
norming

17. 17
Contingency School
• Universal Principle:
– No universal principles of management
can be applied in all situations
• Open Systems Planning:
– Each organization has its own unique
set of technical, human, and market
inputs
• Formal Design of Organizations
– Routine industries need hierarchy,
Complex industries need matrices
• Leadership Style
– Has to be situational