mgt420 ch02

© 2007 Thomson/South-Western. All rights reserved. 2–1

PRINCIPLES AND PRACTICES OF PRINCIPLES AND PRACTICES OF MANAGEMENTMANAGEMENT

ChapterChapter

22Evolution of Management ThoughtEvolution of Management Thought


1.1. Describe the major influences on the development of Describe the major influences on the development of management thought.management thought.

2.2. Identify the five major perspectives of management Identify the five major perspectives of management thought that have evolved over the years.thought that have evolved over the years.

3.3. Describe the different subfields that exist in the Describe the different subfields that exist in the classical perspective of management and discuss classical perspective of management and discuss the central focus of each.the central focus of each.

4.4. Describe the theories of the major contributors to the Describe the theories of the major contributors to the behavioral perspective of management.behavioral perspective of management.

5.5. Describe the characteristics of the quantitative Describe the characteristics of the quantitative perspective of management.perspective of management.

LEARNING OBJECTIVESLEARNING OBJECTIVESWhen you have finished studying this chapter, When you have finished studying this chapter, you should be able to:you should be able to:


LEARNING OBJECTIVES LEARNING OBJECTIVES (cont’d)(cont’d)

6.6. Describe the systems perspective building blocks Describe the systems perspective building blocks and their interactions.and their interactions.

7.7. Discuss the nature of the contingency perspective of Discuss the nature of the contingency perspective of management.management.

8.8. Discuss the future issues that will affect the further Discuss the future issues that will affect the further development of management thought.development of management thought.

When you have finished studying this chapter, When you have finished studying this chapter, you should be able to:you should be able to:


Environmental Factors Influencing Environmental Factors Influencing Management ThoughtManagement Thought• Economic Influences Economic Influences

The availability, production, and distribution of The availability, production, and distribution of resources within a society.resources within a society.

• Social InfluencesSocial Influences The aspects of a culture that influence interpersonal The aspects of a culture that influence interpersonal

relationships.relationships.• Political InfluencesPolitical Influences

The impact of political institutions on individuals and The impact of political institutions on individuals and organizations.organizations.


Environmental Factors Influencing Environmental Factors Influencing Management Thought Management Thought (cont’d)(cont’d)

• Technological InfluencesTechnological Influences The advances and refinements in any of the devices The advances and refinements in any of the devices

that are used in conjunction with conducting business.that are used in conjunction with conducting business.• Global InfluencesGlobal Influences

The pressures to improve quality, productivity, and The pressures to improve quality, productivity, and costs as organizations attempt to compete in the costs as organizations attempt to compete in the worldwide marketplace.worldwide marketplace.


Figure 2.1Figure 2.1 Chronological Development of Management PerspectivesChronological Development of Management Perspectives


Figure 2.Figure 2.2 2 Subfields of the Classical Perspective on ManagementSubfields of the Classical Perspective on Management

Focuses on the Focuses on the individual worker’s individual worker’s

productivityproductivity

Focuses on the Focuses on the functions of functions of managementmanagement

Focuses on Focuses on the overall the overall

organizational organizational systemsystem


Scientific Management: TaylorScientific Management: Taylor• Frederick W. Taylor (1856-1915)Frederick W. Taylor (1856-1915)

Father of “Scientific Management.Father of “Scientific Management. attempted to define “the one best way” to perform every task attempted to define “the one best way” to perform every task

through systematic study and other scientific methods.through systematic study and other scientific methods.

believed that improved management practices lead to believed that improved management practices lead to improved productivity.improved productivity.

Three areas of focus:Three areas of focus: Task PerformanceTask Performance

SupervisionSupervision

MotivationMotivation


Task PerformanceTask Performance• Scientific management incorporates basic Scientific management incorporates basic

expectations of management, including:expectations of management, including: Development of work standardsDevelopment of work standards Selection of workersSelection of workers Training of workersTraining of workers Support of workersSupport of workers


SupervisionSupervision• Taylor felt that a single supervisor could not be Taylor felt that a single supervisor could not be

an expert at all tasks.an expert at all tasks. As a result, each first-level supervisor should be As a result, each first-level supervisor should be

responsible only workers who perform a common responsible only workers who perform a common function familiar to the supervisor.function familiar to the supervisor.

This became known as “Functional Foremanship.”This became known as “Functional Foremanship.”


MotivationMotivation• Taylor believed money was the way to motivate Taylor believed money was the way to motivate

workers to their fullest capabilities.workers to their fullest capabilities. He advocated a piecework system in which worker’s He advocated a piecework system in which worker’s

pay was tied to their output.pay was tied to their output.Workers who met a standard level of production Workers who met a standard level of production

were paid a standard wage rate.were paid a standard wage rate.Workers whose production exceeded the standard Workers whose production exceeded the standard

were paid at a higher rate for all of their production were paid at a higher rate for all of their production output.output.


Scientific Management: The GilbrethsScientific Management: The Gilbreths• Frank Gilbreth Frank Gilbreth

Specialized in time and motion studies to determine Specialized in time and motion studies to determine the most efficient way to perform tasks.the most efficient way to perform tasks.

Used motion pictures of bricklayers to identified work Used motion pictures of bricklayers to identified work elements (therbligs) such as lifting and grasping.elements (therbligs) such as lifting and grasping.

• Lillian GilbrethLillian Gilbreth A strong proponent of better working conditions as a A strong proponent of better working conditions as a

means of improving efficiency and productivity.means of improving efficiency and productivity.Favored standard days with scheduled lunch Favored standard days with scheduled lunch

breaks and rest periods for workers.breaks and rest periods for workers.Strived for removal of unsafe working conditions Strived for removal of unsafe working conditions

and the abolition of child labor.and the abolition of child labor.


Administrative Management: FayolAdministrative Management: Fayol• Henri Fayol (1841Henri Fayol (1841––1925)1925)

First recognized that successful managers had to First recognized that successful managers had to understand the basic managerial functions.understand the basic managerial functions.

Developed a set of 14 general principles of Developed a set of 14 general principles of management.management.

Fayol’s managerial functions of planning, leading, Fayol’s managerial functions of planning, leading, organizing and controlling are routinely used in organizing and controlling are routinely used in modern organizations.modern organizations.


Table 2.Table 2.1 1 Fayol’s General Principles of ManagementFayol’s General Principles of Management

1.1. Division of workDivision of work2.2. Authority and Authority and

responsibilityresponsibility3.3. DisciplineDiscipline4.4. Unity of commandUnity of command5.5. Unity of directionUnity of direction6.6. Subordination of Subordination of

individual interest to the individual interest to the common goodcommon good

7.7. Remuneration of Remuneration of personnelpersonnel

8.8. CentralizationCentralization9.9. Scalar chainScalar chain10.10. OrderOrder11.11. EquityEquity12.12. StabilityStability13.13. InitiativeInitiative14.14. Esprit de corpsEsprit de corps

Source: Based on Henri Fayol, General and Industrial Management, trans. Constana Storrs (London: Pittman & Sons, 1949).


Bureaucratic ManagementBureaucratic Management• Focuses on the overall organizational system.Focuses on the overall organizational system.• Bureaucratic management is based upon: Bureaucratic management is based upon:

Firm rulesFirm rules Policies and proceduresPolicies and procedures A fixed hierarchyA fixed hierarchy A clear division of laborA clear division of labor


Bureaucratic Management: WeberBureaucratic Management: Weber• Max Weber (1864Max Weber (1864––1920)1920)

A German sociologist and historian who envisioned a A German sociologist and historian who envisioned a system of management that would be based upon system of management that would be based upon impersonal and rational behaviorimpersonal and rational behavior——the approach to the approach to management now referred to as “bureaucracy.”management now referred to as “bureaucracy.” Division of laborDivision of labor Hierarchy of authorityHierarchy of authority Rules and proceduresRules and procedures ImpersonalityImpersonality Employee selection and promotionEmployee selection and promotion


Weber’s Forms of AuthorityWeber’s Forms of Authority• Traditional authority Traditional authority

Subordinate obedience based upon custom or Subordinate obedience based upon custom or tradition (e.g., kings, queens, chiefs).tradition (e.g., kings, queens, chiefs).

• Charismatic authorityCharismatic authority Subordinates voluntarily comply with a leader Subordinates voluntarily comply with a leader

because of his or her special personal qualities or because of his or her special personal qualities or abilities (e.g., Martin Luther King, Gandhi).abilities (e.g., Martin Luther King, Gandhi).

• Rational-legal authorityRational-legal authority Subordinate obedience based upon the position held Subordinate obedience based upon the position held

by superiors within the organization (e.g., police by superiors within the organization (e.g., police officers, executives, supervisors).officers, executives, supervisors).


Table 2.Table 2.2 2 Weber’s Three Types of AuthorityWeber’s Three Types of Authority

Type DescriptionTraditional Subordinate obedience based upon

custom or tradition

Charismatic Subordinate obedience based uponspecial personal qualities associatedwith certain social reformers, politicalleaders, religious leaders, ororganizational leaders

Rational–legal Subordinate obedience based uponthe position held by superiorswithin the organization


Figure 2.Figure 2.3 3 Bureaucratic Hierarchical Power StructureBureaucratic Hierarchical Power Structure


Classical versus Behavioral Classical versus Behavioral PerspectivePerspective

Focused on Focused on rational rational behavior behavior

ClassicalClassicalPerspectivePerspective

Acknowledged theAcknowledged theimportance of human importance of human

behaviorbehavior

Behavioral Behavioral PerspectivePerspective

vs.


Behavioral PerspectiveBehavioral Perspective• Followed the classical perspective in the Followed the classical perspective in the

development of management thought.development of management thought. Acknowledged the importance of human behavior in Acknowledged the importance of human behavior in

shaping management styleshaping management style Is associated with:Is associated with:

Mary Parker FollettMary Parker Follett Elton MayoElton Mayo Douglas McGregorDouglas McGregor Chester BarnardChester Barnard


Mary Parker FollettMary Parker Follett• Concluded that a key to effective management Concluded that a key to effective management

was coordination.was coordination.• Felt that managers needed to coordinate and Felt that managers needed to coordinate and

harmonize group effort rather than force and harmonize group effort rather than force and coerce people.coerce people.

• Believed that management is a continuous, Believed that management is a continuous, dynamic process.dynamic process.

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


Follett on Effective Work GroupsFollett on Effective Work Groups• Four principles of coordination to promote Four principles of coordination to promote

effective work groups:effective work groups:1.1. Coordination requires that people be in direct Coordination requires that people be in direct

contact with one another.contact with one another.

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

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

4.4. Coordination is a continuous, ongoing process.Coordination is a continuous, ongoing process.


Elton MayoElton Mayo• Conducted the famous Hawthorne Experiments.Conducted the famous Hawthorne Experiments.

““Hawthorne Effect”Hawthorne Effect” Productivity increased because attention was paid to the Productivity increased because attention was paid to the

workers in the experiment.workers in the experiment. Phenomenon whereby individual or group performance is Phenomenon whereby individual or group performance is

influenced by human behavior factors.influenced by human behavior factors.

• His work represents the transition from scientific His work represents the transition from scientific management to the early human relations management to the early human relations movement.movement.


Douglas McGregorDouglas McGregor• Proposed the Theory X and Theory Y styles of Proposed the Theory X and Theory Y styles of

management.management. Theory X managers perceive that their subordinates Theory X managers perceive that their subordinates

have an inherent dislike of work and will avoid it if at have an inherent dislike of work and will avoid it if at all possible.all possible.

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


Table 2.Table 2.33 Comparison of Theory X and Theory Y AssumptionsComparison of Theory X and Theory Y Assumptions

Factor Theory X Assumptions Theory Y AssumptionsEmployee attitude Employees dislike work and. Employees enjoy work and toward work will avoid it if at all possible. will actively seek it.

Management view Employees must be directed, Employees are self-motivatedof direction coerced, controlled, or threatened and self-directed toward achieving

to get them to put forth adequate effort. organizational goals. Employee view Employees wish to avoid responsibility; Employees seek responsibility; of direction they prefer to be directed and told what they wish to use their creativity, to do and how to do it. imagination, and ingenuity in performing their jobs.

Management style Authoritarian style of management Participatory style of management


Chester BarnardChester Barnard• Felt that executives serve two primary functions:Felt that executives serve two primary functions:

Must establish and maintain a communications Must establish and maintain a communications system among employees.system among employees.

Must establish the objectives of the organization and Must establish the objectives of the organization and motivate employees.motivate employees.

• Developed an acceptance theory of authority:Developed an acceptance theory of authority: Authority of a manager flows from the ability of Authority of a manager flows from the ability of

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


The Quantitative PerspectiveThe Quantitative Perspective• Characterized by its use of mathematics, Characterized by its use of mathematics,

statistics, and other quantitative techniques for statistics, and other quantitative techniques for management decision making and problem management decision making and problem solving. solving.

• This approach has four basic characteristics:This approach has four basic characteristics:1.1. A decision-making focusA decision-making focus2.2. Development of measurable criteriaDevelopment of measurable criteria3.3. Formulation of a quantitative modelFormulation of a quantitative model4.4. The use of computersThe use of computers


The Quantitative Perspective The Quantitative Perspective (cont’d)(cont’d)

• Decision-Making FocusDecision-Making Focus The primary focus of the quantitative approach is on The primary focus of the quantitative approach is on

problems or situations that require direct action, or a problems or situations that require direct action, or a decision, on the part of management.decision, on the part of management.

• Measurable CriteriaMeasurable Criteria The decision-making process requires that the The decision-making process requires that the

decision maker select some alternative course of decision maker select some alternative course of action. action.

The alternatives must be compared on the basis of The alternatives must be compared on the basis of measurable criteria.measurable criteria.


The Quantitative Perspective The Quantitative Perspective (cont’d)(cont’d)

• Quantitative ModelQuantitative Model To assess the likely impact of each alternative on the To assess the likely impact of each alternative on the

stated criteria, a quantitative model of the decision stated criteria, a quantitative model of the decision situation must be formulated.situation must be formulated.

• ComputersComputers Computers are quite useful in the problem-solving Computers are quite useful in the problem-solving

process.process.


Figure 2.Figure 2.4 4 Basic Structure of SystemsBasic Structure of Systems


Systems PerspectiveSystems Perspective• An approach to problem solving based on an An approach to problem solving based on an

understanding of the basic structure of systems.understanding of the basic structure of systems. Environmental interactionEnvironmental interaction

Open systemsOpen systems must interact with the external environment to must interact with the external environment to survive.survive.

Closed systemsClosed systems do not interact with the environment. do not interact with the environment.

Synergy: when all subsystems work together making Synergy: when all subsystems work together making the whole greater than the sum of its parts.the whole greater than the sum of its parts.

Entropy: the tendency for systems to decay over time.Entropy: the tendency for systems to decay over time.


The Contingency PerspectiveThe Contingency Perspective• A view that proposes that there is no one best A view that proposes that there is no one best

approach to management for all situations.approach to management for all situations. Asserts that managers are responsible for Asserts that managers are responsible for

determining which managerial approach is likely to be determining which managerial approach is likely to be most effective in a given situation.most effective in a given situation.

This requires managers to identify the key This requires managers to identify the key contingencies in a given situation.contingencies in a given situation.


Figure 2.Figure 2.5 5 Blending Components into a Contingency PerspectiveBlending Components into a Contingency Perspective


An Example of the Contingency An Example of the Contingency PerspectivePerspective• Joan Woodward’s ResearchJoan Woodward’s Research

Discovered that a particular management style is Discovered that a particular management style is affected by the organization’s technology.affected by the organization’s technology.

Identified and described three different types of Identified and described three different types of technology:technology: Small-batch technologySmall-batch technology Mass-production technologyMass-production technology Continuous-process technologyContinuous-process technology


Table 2.Table 2.4 4 Production Technology ExamplesProduction Technology Examples

Production Technology Examples

Small-batch Custom fabrication machine shop,technology manufacturer of neon advertising signs,

print shop specializing in personal businesscards, trophy-engraving shop

Mass-production Manufacturer of automobiles, manufacturertechnology of refrigerators, manufacturer of hair dryers,

manufacturer of pencils

Continuous-process Oil refinery, flour mill, soft drink bottler,technology chemical processor


Information Technology and Information Technology and Management StyleManagement Style• Information technology can facilitate the use of a Information technology can facilitate the use of a

particular management style.particular management style.

Facilitated by Facilitated by advanced computersadvanced computers

Quantitative/Quantitative/Systems Systems

PerspectivesPerspectives

Classical Classical PerspectivePerspective

Facilitated by Facilitated by communicationscommunications

equipment equipment


Future Issues: Diversity, Globalization, Future Issues: Diversity, Globalization, and Qualityand Quality• Heightened concern for diversity initiatives within Heightened concern for diversity initiatives within

the workplace and within managementthe workplace and within management• Adoption of the concept of workers as decision Adoption of the concept of workers as decision

makers, problem solvers, and team playersmakers, problem solvers, and team players• Creation of a focus on and commitment to the Creation of a focus on and commitment to the

concept of quality.concept of quality.


Management in the 21Management in the 21stst Century Century• William Ouchi’s Theory ZWilliam Ouchi’s Theory Z

Japanese-style approach to management developed Japanese-style approach to management developed by William Ouchiby William OuchiAdvocates trusting employees and making them Advocates trusting employees and making them

feel like an integral part of the organization.feel like an integral part of the organization.Based on the assumption that once a trusting Based on the assumption that once a trusting

relationship with workers is established, production relationship with workers is established, production will increase.will increase.


Future Leaders Must:Future Leaders Must:• Be thoroughly schooled in the different management Be thoroughly schooled in the different management

perspectives.perspectives.• Understand the various influences that will have a Understand the various influences that will have a

continuing effect on management thinkingcontinuing effect on management thinking• Be aware of how key business environment variables Be aware of how key business environment variables

relate to their organization.relate to their organization.• Know which elements to select from the various Know which elements to select from the various

management perspectives that are appropriate for their management perspectives that are appropriate for their situation.situation.

• Be adaptable to change such that future conditions and Be adaptable to change such that future conditions and developments do not quickly render their chosen developments do not quickly render their chosen approaches obsolete.approaches obsolete.