Time Line of Management Thought

PREVIEWPREVIEW

• Review Classical Theories of OrganizationsReview Classical Theories of Organizations• Taylor’s Theory of Scientific ManagementTaylor’s Theory of Scientific Management• Fayol’s Administrative TheoryFayol’s Administrative Theory• Weber’s Theory of BureaucracyWeber’s Theory of Bureaucracy

• Humanistic Theories of OrganizationsHumanistic Theories of Organizations– Human Relations TheoryHuman Relations Theory

• The Hawthorne Studies• Mary Parker Follet• Chester Barnard• McGregor’s Theory X and Theory Y

– Human Resources TheoryHuman Resources Theory• Likert’s Systems Theory (Four Systems of Management)• Blake and Mouton’s (Blake and McCanse) Managerial Grid

Classical Theories ReviewedClassical Theories Reviewed• Classical Theories of Organizations Classical Theories of Organizations – Taylor’s Theory of Scientific Management (tasks)Taylor’s Theory of Scientific Management (tasks)– Fayol’s Administrative Theory (mgmt)Fayol’s Administrative Theory (mgmt)– Weber’s Theory of Bureaucracy (org structure)Weber’s Theory of Bureaucracy (org structure)

• All 3 theories attempt to enhance management’s ability to All 3 theories attempt to enhance management’s ability to predict and control the behavior of their workerspredict and control the behavior of their workers

• Considered only the Considered only the task functiontask function of communication (ignored of communication (ignored relational and maintenance functions of communication)relational and maintenance functions of communication)

• Designed to predict and control behavior in organizationsDesigned to predict and control behavior in organizations

Classical vs. HumanisticClassical vs. Humanistic

• Classical theories emphasized coercion, control, and punishment Classical theories emphasized coercion, control, and punishment (FOCUS ON TASKS /PRODUCTION).(FOCUS ON TASKS /PRODUCTION).– Maintain predictability and controlMaintain predictability and control– Decision-making power at top of hierarchyDecision-making power at top of hierarchy– Minimize input from lower-level employeesMinimize input from lower-level employees– Rely on science and rules to guide behaviorRely on science and rules to guide behavior– Regulate communication to increase predictability and decrease Regulate communication to increase predictability and decrease

misunderstandingsmisunderstandings– Result: Result:

• Workers feel they have no control over their work situationWorkers feel they have no control over their work situation• Management does not care about their ideasManagement does not care about their ideas• Feelings and ideas of workers are unimportantFeelings and ideas of workers are unimportant

• Humanistic theories were developed to promote the CONCERNS of the Humanistic theories were developed to promote the CONCERNS of the individual worker in an atmosphere that was too focused on individual worker in an atmosphere that was too focused on production (FOCUS ON RELATIONAL & MAINTENANCE FUNCTIONS)production (FOCUS ON RELATIONAL & MAINTENANCE FUNCTIONS)

Principles of Human Relations TheoryPrinciples of Human Relations Theory

• Human relations theory is characterized by a shift in emphasis from TASK Human relations theory is characterized by a shift in emphasis from TASK to WORKERto WORKER

• Go beyond physical contributions to include creative, cognitive, and Go beyond physical contributions to include creative, cognitive, and emotional aspects of workersemotional aspects of workers

• Based on a more dyadic (two-way) conceptualization of communication.Based on a more dyadic (two-way) conceptualization of communication.• SOCIAL RELATIONSHIPS are at the heart of organizational behavior--SOCIAL RELATIONSHIPS are at the heart of organizational behavior--

effectiveness is contingent on the social well-being of workerseffectiveness is contingent on the social well-being of workers• Workers communicate opinions, complaints, suggestions, and feelings to Workers communicate opinions, complaints, suggestions, and feelings to

increase satisfaction and productionincrease satisfaction and production• Origins (Hawthorne Studies & work of Chester Barnard)Origins (Hawthorne Studies & work of Chester Barnard)• Human Relations School of Management - Elton Mayo Human Relations School of Management - Elton Mayo

Origins of Human Relations Origins of Human Relations TheoryTheory

Arose out of the influences of•the threat of unionization.•the Hawthorne studies.•the philosophy of industrial humanism.

The Human Relations Movement

Pyramid

• The Threat of Unionization– The Wagner Act of 1935 legalized union-management

collective bargaining, promoting the growth of unions and union avoidance by firms.

• The Hawthorne Studies (1924)– Hawthorne Works of Western Electric CompanyHawthorne Works of Western Electric Company– 1924 - Chicago1924 - Chicago– Research focus: Relation of quality and quantity of illumination to efficiency in Research focus: Relation of quality and quantity of illumination to efficiency in

industryindustry– Four Important StudiesFour Important Studies– The study’s results that productivity was strongly affected by attitudes of

management toward the humanistic and realistic viewpoint of the “social man” model.

Industrial Humanism

• Followed the classical perspective in the development of management thought.Is associated with the contributions of :• Mary Parker Follett• Elton Mayo• Douglas McGregor• Chester Barnard• And others

Mary Parker Follett(1868-1933)• Attached great importance to socio-psychological

problems • Was of the view that conflict is not necessarily

destructive..it may be constructive also• Concluded that a key to effective management was

coordination.• Felt that managers needed to coordinate and

harmonize group effort rather than force and coerce people.

• Believed that management is a continuous, dynamic process.

• Felt that the best decisions would be made by people who were closest to the situation.

Follett on Effective Work Groups

• Four principles of coordination to promote effective work groups:

1. Coordination requires that people be in direct contact with one another.

2. Coordination is essential during the initial stages of any endeavor.

3. Coordination must address all factors and phases of any endeavor.

4. Coordination is a continuous, ongoing process

Elton MayoConducted the famous Hawthorne Experiments.

“Hawthorne Effect”•Productivity increased because attention was paid to the workers in the experiment.•Phenomenon whereby individual or group performance is influenced by human behavior factors.

His work represents the transition from scientific management to the early human relations movement.He concluded that the “rabble hypothesis” about human behaviour was unfounded

Elton Mayo1880 – 1949

““The Hawthorne Studies”The Hawthorne Studies”

• Illumination StudyIllumination Study (November 1924) (November 1924)– Designed to test the effect of lighting intensity on worker productivityDesigned to test the effect of lighting intensity on worker productivity– influence of human relations on work behaviorinfluence of human relations on work behavior

• Relay Assembly Test Room StudyRelay Assembly Test Room Study (1927-1932) (1927-1932)– Assembly of telephone relays (35 parts - 4 machine screws) Assembly of telephone relays (35 parts - 4 machine screws) – Production and satisfaction increasedProduction and satisfaction increased– Workers’ increased production and satisfaction related to supervisory practicesWorkers’ increased production and satisfaction related to supervisory practices– Human interrelationships are important contributing factors to worker productivityHuman interrelationships are important contributing factors to worker productivity– Bottom Line: Supervisory practices increase employee morale AND productivityBottom Line: Supervisory practices increase employee morale AND productivity

• Interviewing ProgramInterviewing Program (1928-1930) (1928-1930)– Investigate connection between supervisory practices and employee moraleInvestigate connection between supervisory practices and employee morale– Employees expressed their ideas and feelings (e.g., likes and dislikes)Employees expressed their ideas and feelings (e.g., likes and dislikes)– Process more important than actual resultsProcess more important than actual results

• Bank Wiring Room Observation StudyBank Wiring Room Observation Study (November 1931 - May 1932) (November 1931 - May 1932)– Social groups can influence production and individual work behaviorSocial groups can influence production and individual work behavior– How is social control manifested on the shop floor?How is social control manifested on the shop floor?– Informal organization affect employee behavior positively within formal organizational Informal organization affect employee behavior positively within formal organizational

structurestructure

Illumination Studies – 1924-1927

• Funded by General Electric

• Conducted by The National Research Council (NRC) of the National Academy of Sciences with engineers from MIT

• Measured Light Intensity vs. Worker Output

• Result – Each change resulted in higher output and reported greater employee satisfaction

• Conclusions: – Light intensity has no conclusive effect on output– Productivity has a psychological component – Researchers interaction with

the workers influenced higher performance

• Concept of “Hawthorne Effect” was created

Relay Assembly Test Experiments 1927-1929 • Western Electric wanted more information

• Harvard researchers brought in to analyze the results – Elton Mayo & Fritz Roethlisberger

• Group of 6 Women – (5) Assemblers and (1) Layout Operator

• One Observer – Explained every incremental change and recorded results

• Manipulated factors of production to measure effect on output:– Pay Incentives– Length of Work Day & Work Week– Use of Rest Periods– Company Sponsored Meals

• Management Visits / Special Attention

• Result – Most changes resulted in higher output and reported greater employee satisfaction

• Conclusions: – Experiments yielded positive effects even with negative influences – workers’ output will

increase as a response to attention– Strong social bonds were created within the test group. Workers are influenced by need for

recognition, security and sense of belonging

Relay Assembly Room #2 - 1928-1929

• Measured output changes with pay incentive changes– Special observation room to re-test some of the factors on other

groups– Workers were paid the group bonus incentives

• Results– During nine weeks there was 13% increase in the output on average

per person

• Conclusion: Pay incentives were a relevant factor in output increases but not the only factor.

Mica Splitting Test Group - 1928-1931

• Measured output changes with changes in work conditions only:– Special Observation Room– Length of Work Day– Use of Rest Periods– Workers stayed on established Piece-rate compensation

• Result - Productivity increased by 15% over standard output base

• Conclusions: – Productivity is affected by non-pay considerations– Social dynamics are a basis of worker performance

Plant Interview Program – 1925-1932

• 1925-1927 – Objective Questions– Work Conditions– Work Relationships– Yes/No Answers

• 1928-1932 – Conversational / Non-directive– Attentive Sympathetic Listening– Concern for personal needs– Increased in time from 30-90 minutes

• Result – Remarkable positive employee perceptions:– Working Condition Improved – Better Wages

• Conclusions: – New Supervisory Style improved worker morale– Complaints reflected personal and/or social barriers that needed attention in order to

raise productivity

Bank Wiring Observation Group – 1931-1932

• 14 Male Workers

• Few Special Conditions– Segregated work area– No Management Visits– Supervision would remain the same– Observer would record data only – no interaction with workers

• New incentive pay rate was established for the small group

• Any increases in output would be included in departmental pay incentives

• Result – No appreciable changes in output

• Conclusions: – Well established performance norms existed in the group– Informal Social Organization dictated little deviation from established production

standards – Systemic Soldiering– Informal Social Organizations protect workers from managers who

• Raise production standards• Cut pay rates• Challenge workplace norms

Hawthorne Studies - ImplicationsHawthorne Studies - Implications

• Illumination StudyIllumination Study (November 1924) (November 1924)– The mere practice of observing people’s behavior tends to alter their behavior The mere practice of observing people’s behavior tends to alter their behavior

(Hawthorne Effect)(Hawthorne Effect)• Relay Assembly Test Room StudyRelay Assembly Test Room Study (1927-1932) (1927-1932)

– Relationships between workers and their supervisors are powerfulRelationships between workers and their supervisors are powerful– Human interrelationships increase the amount and quality of worker participation in Human interrelationships increase the amount and quality of worker participation in

decision makingdecision making• Interviewing ProgramInterviewing Program (1928-1930) (1928-1930)

– Demonstrated powerful influence of upward communicationDemonstrated powerful influence of upward communication– Workers were asked for opinions, told they mattered, and positive attitudes toward Workers were asked for opinions, told they mattered, and positive attitudes toward

company increasedcompany increased• Bank Wiring Room Observation StudyBank Wiring Room Observation Study (November 1931 - May 1932) (November 1931 - May 1932)

– Led future theorists to account for the existence of informal communicationLed future theorists to account for the existence of informal communication

• Taken together, these studies helped to document the powerful nature of social Taken together, these studies helped to document the powerful nature of social relations in the workplace and moved managers more toward the interpersonal relations in the workplace and moved managers more toward the interpersonal aspects of organizing.aspects of organizing.

Chester Barnard:Chester Barnard:The Emergence of CommunicationThe Emergence of Communication

– Considered a bridge between classical and human relations Considered a bridge between classical and human relations theoriestheories

– The Functions of the Executive (The Functions of the Executive (1938)1938)– Argues for . . . Argues for . . .

• strict lines of communication - classical theorystrict lines of communication - classical theory• a “human-based system of organization”a “human-based system of organization”• The potential of every worker and the centrality of The potential of every worker and the centrality of

communication to the organizing processcommunication to the organizing process

– Six Issues Relevant to Organizational CommunicationSix Issues Relevant to Organizational Communication• Formal vs. Informal OrganizationFormal vs. Informal Organization• CooperationCooperation• CommunicationCommunication• IncentivesIncentives• AuthorityAuthority• Zone of IndifferenceZone of Indifference

• Felt that executives serve two primary functions:– Must establish and maintain a communications

system among employees.– Must establish the objectives of the organization and

motivate employees.• Developed an acceptance theory of authority:– Authority of a manager flows from the ability of

subordinates to accept or reject an order from the manager once they:• Comprehend what the order requires of them.• Review the order’s consistency with organization goals.• Perceive a personal benefit in obeying the order

Six Issues Relevant to Organizational CommunicationSix Issues Relevant to Organizational Communication

• Formal vs. Informal OrganizationFormal vs. Informal Organization– Formal Organization - a system of consciously coordinated Formal Organization - a system of consciously coordinated

activities or forces of two or more persons. (definite, activities or forces of two or more persons. (definite, structured, common purpose)structured, common purpose)• Persons are able to communicate with one anotherPersons are able to communicate with one another• Willing to contribute actionWilling to contribute action• To accomplish a common purposeTo accomplish a common purpose

– Informal Organization - based on myriad interactions that take Informal Organization - based on myriad interactions that take place throughout an organization’s history.place throughout an organization’s history.• IndefiniteIndefinite• Structure lessStructure less• No definite subdivisions of personnelNo definite subdivisions of personnel• Results: customs, mores, folklore, institutions, social Results: customs, mores, folklore, institutions, social

norms, ideals -- may lead to formal organizationnorms, ideals -- may lead to formal organization

Six Issues Relevant to Organizational CommunicationSix Issues Relevant to Organizational Communication

• CooperationCooperation– Necessary component of formal organizationNecessary component of formal organization– The expression of the net satisfactions or dissatisfactions The expression of the net satisfactions or dissatisfactions

experienced or anticipated by each individual in comparison with experienced or anticipated by each individual in comparison with those experienced or anticipated through alternative those experienced or anticipated through alternative opportunitiesopportunities

• CommunicationCommunication– Critical to cooperationCritical to cooperation– The most universal form of human cooperation, and perhaps the The most universal form of human cooperation, and perhaps the

most complex, is speechmost complex, is speech– The most likely reason for the success of cooperation and the The most likely reason for the success of cooperation and the

reason for its failurereason for its failure– System of communication: known, formal channels which are as System of communication: known, formal channels which are as

direct (short) as possible, where the complete line of direct (short) as possible, where the complete line of communication is used, the supervisory heads must be communication is used, the supervisory heads must be competent, the line of communication should not be interrupted, competent, the line of communication should not be interrupted, and every communication should be authenticated.and every communication should be authenticated.

– Barnard’s system lacks relationship formation and maintenance Barnard’s system lacks relationship formation and maintenance mechanismsmechanisms

• IncentivesIncentives– Should be availableShould be available

• AuthorityAuthority– Associated with securing cooperation for organizational membersAssociated with securing cooperation for organizational members– The interrelationship among the originator of the communication, the The interrelationship among the originator of the communication, the

communication itself, and the receivercommunication itself, and the receiver– Authority of position OVER Authority of Leadership (knowledge & Authority of position OVER Authority of Leadership (knowledge &

ability).ability).• Zone of Indifference - orders followedZone of Indifference - orders followed

– Marks the boundaries of what employees will consider doing without Marks the boundaries of what employees will consider doing without question, based on expectations developed on entering the question, based on expectations developed on entering the organization.organization.

Barnard drew attention away from formal organizational structures Barnard drew attention away from formal organizational structures toward communication, cooperation, and the informal organization. toward communication, cooperation, and the informal organization. His work was integrated by other theorists in the human relations movement.

Douglas McGregorDouglas McGregor• Douglas McGregor (1906-1964)Douglas McGregor (1906-1964)

– Articulated basic principles of human relations theory– The Human Side of Enterprise (1960, 1985)– To understand human behavior, one must discover the theoretical

assumptions upon which behavior is based– Especially interested in the behavior of managers toward workers– “Every managerial act rests on assumptions, generalizations, and

hypotheses--that is to say, on theory . . . Theory and practice are inseparable.”

– Two Objectives:• Predict and control behavior• Tap Unrealized potential

– Theory X - Classical Theory– Theory Y - Human Relations Theory– FOCUS: Manager’s assumptions about HUMAN NATURE

Theory X and Theory Y

– Theory X managers perceive that their subordinates have an inherent dislike of work and will avoid it if at all possible.

– Theory Y managers perceive that their subordinates enjoy work and that they will gain satisfaction from performing their jobs.

Theory X and Theory Y: Linkage with management Theory X and Theory Y: Linkage with management theoriestheories

• Theory X - Classical TheoryTheory X - Classical Theory– Three Assumptions• The average human being has an inherent dislike

of work and will avoid it.• Most people must be coerced, controlled,

directed, and threatened with punishment• The average human being prefers to be directed,

wishes to avoid responsibility, has relatively little ambition, wants security.

– Neither explains nor describes human nature

• Theory Y - Human Relations TheoryTheory Y - Human Relations Theory– AAssumptionsssumptions

• Physical and mental effort in work is similar to play / rest.Physical and mental effort in work is similar to play / rest.• External control and the threat of punishment are not the only External control and the threat of punishment are not the only

strategiesstrategies• Commitment to objectives is a function of the rewards associated Commitment to objectives is a function of the rewards associated

with their achievementwith their achievement• The average human being learns, under proper conditions, not The average human being learns, under proper conditions, not

only to accept but to seek responsibilityonly to accept but to seek responsibility• The capacity to exercise a high degree of imagination, ingenuity, The capacity to exercise a high degree of imagination, ingenuity,

and creativity in the solution of organizational problems is widely and creativity in the solution of organizational problems is widely distributed in the populationdistributed in the population

• Intellectual potentialities of the average human being are Intellectual potentialities of the average human being are underutilizedunderutilized

– A more positive perspective of human natureA more positive perspective of human nature– The KEY to control and quality production is The KEY to control and quality production is commitment to commitment to

organizational objectivesorganizational objectives

Blake and Mouton’s Managerial GridBlake and Mouton’s Managerial Grid

• Stresses interrelationship between production (task) and peopleStresses interrelationship between production (task) and people• Management’s main purpose is to promote a culture in the organization that Management’s main purpose is to promote a culture in the organization that

allows for high production at the same time that employees are fostered in allows for high production at the same time that employees are fostered in their professional and personal developmenttheir professional and personal development

• Managerial Grid - now Leadership Grid (Blake & McCanse) (Figure 3.3, p. 59)Managerial Grid - now Leadership Grid (Blake & McCanse) (Figure 3.3, p. 59)• FOCUS: Manger’s Assumptions about CONCERN for PEOPLE and CONCERN FOCUS: Manger’s Assumptions about CONCERN for PEOPLE and CONCERN

for PRODUCTIONfor PRODUCTION• Concern for PEOPLEConcern for PEOPLE

– Degree of personal commitment to one’s jobDegree of personal commitment to one’s job– Trust-based accountability (vs. obedience-based accountability)Trust-based accountability (vs. obedience-based accountability)– Self-esteem for the individualSelf-esteem for the individual– Interpersonal relationships with co-workersInterpersonal relationships with co-workers

• Concern for PRODUCTIONConcern for PRODUCTION– Use of people and technology to accomplish organizational tasksUse of people and technology to accomplish organizational tasks– Concern for is not about quantity or qualityConcern for is not about quantity or quality

• Assessment instrument does not represent personality traits of the manager Assessment instrument does not represent personality traits of the manager -- instead, indicate a specific orientation to production and people-- instead, indicate a specific orientation to production and people

Blake and Mouton’s Managerial GridBlake and Mouton’s Managerial Grid

•Authority Compliance (9,1)

•Classical theory

•Country Club (1,9)

•Informal grapevine

•Impoverished (1,1)

•Laissez-faire

•Middle-of-the-Road (5,5)

•Compromise (carrot & stick)

•Team (9,9)

•Human Resources Approach

•Promote the conditions that integrate creativity, high productivity, and high morale through concerted team action