Btech Evolution of Management

7/25/2019 Btech Evolution of Management

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The Evolution of Management

Theory & Functions ofmanagement


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Modern management began in the late 19thcentury.

Organizations were seeking ways to better satisfy customer

needs. Machinery was changing the way goods were produced.

Managers had to increase the efficiency of the worker-taskmix.


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Adam Smith, 1th century economist, found firmsmanufactured !ins in t"o "ays# Craft-- each worker did all steps. Factory-- each worker specialized in one step.

Smith found that the factory method had muchhigher !roductivity. Each worker became ery skilled at one! specific task.

$rea%ing do"n the total ob allo"ed for the divisionof labor.


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"#$% "$&% '%%%

Administrative Management

$ehavioral Management

Scientific Management

Management Science

'rg. Environment


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Classical ManagementPerspective

Scientific Management

Concerned with improing the performance of

indiidual workers (i.e.! efficiency).

*rew out of the industrial reolution+s laborshortage at the beginning of the '%thcentury.

Administrative Management

, theory that focuses on managing the totalorganization.


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efined by Frederick aylor! late "#%%+s.

he systematic study of the relationships between

people and tasks to redesign the work for higherefficiency. aylor sought to reduce the time a worker spent on each task by

optimizing the way the task was done.


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Scientifc study o what workers ought to be able to produce. Used time studies to break tasks down into elementary movements

and designed complementary piece rate incentive system. Taylor believed that managements responsibility was in knowing what

it wanted workers to do and then seeing that they do in in the bestand cheapest way..

To improve productivity he examined the time and motion details o a

job developed a better method or perorming the job and trained theworkers.

!e studied workers loading pig iron to a rail car and broke down intoits smalles constituent movements timing each one with a stopwatch. The job was redisgned with a reduced number o motions aswell as e"ort and the risk o error. #est periods o specifc durationwere used to improve the output.

!e o"ered a piece rate that increased as workers produced more. !e increased the workers output rom $% to &' toms per day. S( was defned as methods aiming at determining one best way or a

job to be done. !e negated the role o workers as thinking beings


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Four (rinci!les to increase efficiency#". Study the "ay the ob is !erformednow / determine new

ways to do it. *ather detailed! time and motion information.

ry different methods to see which is best.'. )odify the ne" method into rules. each to all workers.

0. Select "or%ers "hose s%ills matchthe rules set in 1tep '.&. Establish a fair level of !erformanceand pay for higher

performance. 2orkers should benefit from higher output.


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Managers often im!lemented only the increasedout!ut side of Taylor*s !lan. hey did not allow workers to share in increased output. 1pecialized 3obs became ery boring! dull.

2orkers ended up distrusting 1cientific Management. +or%ers could !ur!osely under-!erform Management res!onded "ith increased use of

machines.


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1eeks to create an organization that leads to bothefficiency and effectieness.

More general theory of management

4ole of manager and functions of management.


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". /ivision of 0abor# allows for 3ob specialization. he more people specialize!the more efficiently they can perform their work.

'. Authority and es!onsibility# Fayol included both formal and informalauthority resulting from special expertise. Managers must gie orders so thatthey can get things done. 2hile their formal authority gies them the right tocommand! managers will not always compel obedience unless they haepersonal authority (such as releant expertise) as well.

0. 2nity of )ommand# Employees should hae only one boss. Each employeemust receie instructions from only one person. Fayol belieed that when anemployee reported to more than one manager! conflicts in instructions andconfusion of authority would result.

&. 0ine of Authority# a clear chain from top to bottom of the firm. 5t is often

represented today by the neat boxes and lines of the organization chart6runs inorder of rank from top management to the lowest leel of the enterprise.

7. )entrali3ation# the degree to which authority rests at the ery top. ecreasingthe role of subordinates in decision making is centralization8 increasing their rolein decentralization.


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9. 2nity of /irection# One plan of action to guide the organization. hose

operations within the organization that hae the same ob3ectie should bedirected by only one manager using one plan. For example! the personneldepartment in a company should not hae two directors! each with a differenthiring policy.

:. E4uity#reat all employees fairly in 3ustice and respect.

#. 'rder#Each employee is put where they hae the most alue. Materials andpeople should be in the right place at the right time. ;eople! in particular!should be in the 3obs or positions they are most suited to.

$. 5nitiative#Encourage innoation. 1ubordinates should be gien the freedomto conceie and carry out their plans! een though some mistakes may result.

"%./isci!line# Members in an organization need to respect the rules andagreements that goern the organization. o Fayol! discipline results fromgood leadership at all leels of the organization! fair agreements (such as

proisions for rewarding superior performance)! and 3udiciously enforcedpenalties for infractions.


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"". emuneration of (ersonnel#he payment system contributes to success.

"'. Stability of Tenure#


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#easoning that any goal)oriented organi*ation consisting othousands o individuals would re+uire the careullycontrolled regulation o its activities the ,erman sociologist(ax -eber $/0&)$1%23 developed a theory o bureaucraticmanagement that stressed the need or a strictly defned

hierarchy governed by clearly defned regulations and lineso authority. !e considered the ideal organi*ation to be abureaucracy whose activities and objectives wererationally thought out and

whose divisions o labor were explicitly spelled out.

-eber also believed that technical competence should beemphasi*ed and that perormance evaluations should bemade entirely on the basis o merit.


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4learly defned job roles 5 hierarchy o authority

Standardi*ed procedures

(eticulous record6keeping

!iring employees only i they meet the specifc+ualifcations or a job


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,ccording to >arnard! people come together in formal organizations to achieeends they cannot accomplish working alone.

>ut as they pursue the organization?s goals! they must also satisfy theirindiidual needs. ,nd so >arnard arried at his central thesis@ ,n enterprisecan operate efficiently and surie only when the organization+s goals are keptin balance with the aims and needs of the indiiduals working for it. 2hat>arnard was doing was specifying a principle by which people can work in

stable and mutually beneficial relationships oer time. For example! to meet their personal goals within the confines of the formal

organization! people come together in informal groups such as cliAues. oensure its surial! the firm must use these informal groups effectiely! een ifthey sometimes work at purposes that run counter to management+s ob3ecties.

>arnard?s recognition of the importance and uniersality of this BinformalorganizationB was a ma3or contribution to management thought.

>arnard belieed that indiidual and organizations purposes could be kept inbalance if managers understood an employee?s 3one of indifference that is,"hat the em!loyee "ould do "ithout Auestioning the manager?s authority.


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7stablish and maintain an e"ective communicationsystem

!ire and retain e"ective personnel (otivate those personnel

The acceptance of authority depends of 4conditions

employees must understand what the manager wantsthem to do

7mployee ust be able to comply with the directive 7mployees must think that the directive is keeping with

the organi*ational objectives 7mployee must think that the directive is not contrary

to their peronal goalss


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!uman relations is re+uently used as a general term todescribe the ways in which managers interact with theiremployees. -hen 8employee management8 stimulatesmore and better work the organi*ation has e"ective

human relations9 when morale and e:ciency deteriorateits human relations are said to be ine"ective.

The human relations movement arose rom early attemptsto systematically discover the social and psychologicalactors that would create e"ective human relations


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;n these and subse+uent experiments (ayo and his associatesdecided that a complex chain o attitudes had touched o" theproductivity increases.


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The researchers also concluded that inormal work groups))thesocial environment o employees)) have a positive in>uence onproductivity.

(any o -estern 7lectrics employees ound their work dulland meaningless but their associations and riendships withco)workers sometimes in>uenced by a shared antagonism

toward the 8bosses8 imparted some meaning to their workinglives and provided some protection rom management. ?orthese reasons group pressure was re+uently a strongerin>uence on worker productivity than management demands.

To (ayo then the concept o 8social man8))motivated bysocial needs wanting rewarding on)the job relationships and

responding more to work)group pressures than to managementcontrol))vas necessary to complement the old concept o8rational man8 motivated by personal economic needs. 5llthese fndings might unremarkable today.


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@o direct cause and e"ect relationship betweenworking conditions and productivity. -orkerattitude was important.

-henever employees are given special attention

productivity is likely to change irrespective oworking conditions

5n employees complaint re+uently is a symptomo some underlying problem on the job or athome.

The workplace is a social system and inormalgroup in>uence could exert a powerul e"ect onindividual behaviour.


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Btech Evolution of Management