2_Evolution of Mgmt. Thought

8/7/2019 2_Evolution of Mgmt. Thought

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Evolution of Management Thought


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Pr e-histo r ic human settlements

Administration of Mohenjodaro and Harappa cities(2000 BC)

Egyptian organization and administration(1300 BC)

Buddha Order (530 BC)

Roman Catholic church management

Military organization from historic times


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` Pr e-scientific Management E r a- Cottage industry, Barter system

` I ndust r ial Revolution- (18 th century, England, Europe, U.S.A)- Factories with steam power mechanization- Rail road/steamer transportation


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A system based on rigid rules, regulations and procedures

ThreeStreams

ScientificManagementF.W. Taylor (1911)Gantt,Gilbreth

BureaucracyMax Weber (1946)

ModernOperationalManagementtheory

Henri Fayol(1916)


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` The Hierarchy` Specialisation and division of labour ` The scalar principle` Unity of command` Departmentalisation` Span of control` Parity of authority and responsibility` Centralization vs Decentralization` Line and staff relationship


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` Application of Scientific Method to optimise

productivityx Frederick W. Taylor(1856-1915)x Henry Gantt( 1861-1919)x Lillian G ILBRETH (1878-1972)

Scientific method comprised:-ObservationMeasurementExperimentationInference


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` Science not rule of thumb.` Harmony not discord.` Co-operation not individualism.` Maximum output in place of restricted output.` Development of each man to his maximum efficiency

and prosperity.` Equitable division of work and responsibility

between management and labour.


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C r iticised on the following g r ounds1) Mechanistic approach that ignores human element,devoid by human touch.

2) Narrow view. Limited to efficiency on shop floor.

3) Unrealistic assumptions of humans only physical andeconomic needs, overlooking social and esteem needs.

4) Impracticable as all functions cannot be separated.

5) Exploitation of labour. Increasing worker efficiencyand specialisation affect health and create monotony.


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` A continuous organisation of official functions bound by rules-impersonal relationships.

` Specific sphere of competence- Functions as marked by division of work.- Incumbent vested with authority.

- Necessary means of compulsion provided.` Organisation to follow principles of hierarchy of control and

supervision.` Persons to be trained in rules and norms.`

Administration to be separated from ownership of theenterprise.` All acts, rules and decisions are formulated and recorded in

writing.


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ADVANTAGES LIMITATIONS

` Specialisation` Structure` Rationality` Predictability` Democratic

` Rigidity` Goal Displacement` Impersonal Relationship

` Compartmentalisation of activities` Paperwork ` Empire building` Red Tape


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` - Emphasises Role of the manager and the functionsof Management.HENRI FAYOL [1841-1925]

` F ayols Pr inciples of ManagementDivision of work Authority and responsibilityDisciplineUnity of commandUnity of direction


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Subordination of individual to general interest.Remuneration of personnel.Centralization.Scalar chain.

Order.Equity.Stability of tenure of personnel.

Initiative.Espirit de corps.


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` Based on knowledge of Psychology, Sociology andAnthropology.

H awtho r neStudy(1924-33)

Elton MayoF.J.

Roethlisberge

r

H umanRelations

Movement

C heste r Be r na r d

[1886-1961]

Behaviou r alscience

app r oach

Like r t, McG r ego r ,Maslow


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Contd.

c) Mass Interview Programme:- Opportunity to talk freely improved moral and

productivity.d) Bank wiring Observation Room Study:- Despite group incentives productivity did not improve

because the group members enforced their normswithin the group.

- Evaluation : - A landmark in evolution towards

humanising management. Attention towards social and psychological needs, informal group, group dynamics,motivation, morale and leadership.


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Contd.

2.Human Relation Movement .

Socio-psychological approach to management. Amanagement practice concerned with integration of

people into work situation in a way that motivates them

to work together productively, cooperatively and withsatisfaction, to achieve organisational goals.Four important Elements:- The Individual

- The Work Group- The Leader - The Work Environment.


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Contd.

C ont r ibutions:- Highlights human side of organisation.- Meets social and psychological needs of people,

enhancing satisfaction, productivity.- Focus on inter- personal relations.- Focus on people management skills and leadership styles.3 . Behaviou r al Science App r oachOrganisational Behaviour involves study of attitudes,

behaviour and performance of individuals and groups inorganisational setting for which the knowledge drawnfrom psychology, sociology, anthropology is applied.


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` An organization is a socio-technical system.` Individuals differ in their attitudes, perceptions and

values and react differently.` Goals of members may differ from that of

organization- fusion of the two is important.

` Informal groups are formed in organizations.` Informal groups significantly influence attitudes and

behavior of individuals.


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`

The work group is not merely a techno-economic unit but alsoa social system with its own culture.` Workers are not simply motivated by money alone, but socio-

psychological factors are important.` Social and psychological factors exercise a greater influence

on employee behavior than physical conditions of work.` Informal groups are formed in workplace which greatly

influence individuals performance according to group norms.` Workers respond to factors both inside and outside the

workplace.` Complaints and criticism by employees are manifestation of

deeper dissatisfaction.


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` Managers take two distinctly different views of human beings, Negative theory X and Positive theory Y, whichtends to mold their behaviour towards subordinates.


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` Employees inherently dislike work and, whenever possible, will attempt to avoid it.

` They must be coerced, controlled, or threatened with

punishment to achieve desired goals.` Employee will shirk responsibilities and seek formal

direction whenever possible.` Workers place security above other factors and will

display little ambition.


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` Employees can view work as being as natural as restor play.

` Human beings will exercise self-direction and self-

control if they are committed to the objectives.` The average person can learn to accept, even seek,

responsibility.` Creativity- the ability to make good decisions- is

widely dispersed throughout the population.


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BAS IC C LASS IC AL NEO- C LASS IC AL

STRUCTURE Impersonal, mechanical Social system

BEHAVIOUR Product of rules andregulation

Product of feelings,attitude and sentiments

FOCUS On work and economicneeds of workers

On small groups andhuman qualities of employees

EMPHASIS On order and rationality On security and socialneeds of workers

PRACTICES Authoritarian Democratic

RESULTS Work alienation,dissatisfaction.

Happy employees tryingto produce more


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Management Science vs . Quantitative Management :

Management Science focuses specifically on thedevelopment of mathematical models.Quantitative Management applies quantitativetechniques to management.


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` Management Science &M I S:- Uses Mathematicaland Statistical approaches to

` solve management problemsx GEORGE DANTZ I G Etc .x DSS &ER P SYSTEMS

` Pr oduction and Ope r ations Resea r ch:- Focusesupon operation and control of production process thattransforms resources into finished goods andservices.

x JU RANx W .EDWARDS DEM I NG


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` H uman Relations ` Scientific Management1. No U nive r sal Pr inciples 1 . Pr inciples fo r unive r sal application .

2. F ocus on people 2 . F ocus on machines .

3. No one best way 3 . One best way to doing things .

4. Man is a social animal . 4. Man is an economic animal .

5. G r oup dynamics, motivation, jobsatisfaction .

5. Time and motion studies, functionalfo r emanship and wage incentive .

6. Application of knowledge de r ivedf r om behaviou r al sciences .

6. Application of knowledge of physicalscience .

7. I mp r ovements in inte r - pe r sonalr elation

7. I mp r ovements in p r oductivity andefficiency .


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` This theory focuses on the making of decisions, persons or groups making decisionsand the decision-making process. Sometheorists use decision making as a springboardto study all enterprise activities. The

boundaries of study are no longer clearlydefined.


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` The contingency approach suggests thatappropriate managerial behaviour in a givensituation depends on, or is contingent on, awide variety of elements. Stated differently,effective managerial in one situation cannot

always be generalized to other situations


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A wholistic, integ r ated app r oach .( T r ist, Katz, Kahn )

INPUT

Men,Material,MoneyTechnology

PROCESSES

ActivitiesOperations

OUTPUTS

GoalsSales/Profits

ENV I RONMENT

TARGETS

ENV I RONMENT


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System : an interrelated set of elementsfunctioning as a whole.

Types of Systems:Open System : an organisational system thatinteracts with its environment.C losed System : an organisational system thatdoes not interact with its environment.Subsystem : a system within a broader system.


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` Organisation as a unified and purposeful systemconsisting of several interconnected, interacting andinterdependent parts or subsystems.

`

Sub-system influence each other and the system asthey are linked through goals, flow of authority,resources etc.

` System has a bounda r y which separates it from the

environment. Employees are within whereas creditorsand customers are external.


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` Open system continually interacts with its externalenvironment whereas a closed system is self-containedand isolated.

` A business organisation is a dynamic and open systemwhich draws input from environment, converts theminto output and delivers to the environment.

` System receives feedback from the environment basedon which changes are made within.

` After sometime a system may suffer from ENTROPY, anegative energy unless organization is managed well.


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E ffective and efficient managementC lassicalManagementP er spectives:

Methods for enhancingefficiency and facilitating

planning, organizing, andcontrolling

Behavio r al ManagementP er spectives:

Insights for motivating performance and

understanding individual

behavior, groups andteams, and leadership

QuantitativeManagementP er spective:

Techniques for improving decisionmaking, resource

allocation, andoperations

C ontingency P er spectiveSystems App r oach

Recognition of the situationalnature of management.Response to particular

characteristics of situation .

Recognition of internalinterdependencies.

Recognition of environmentalinfluences .

Effective and efficient management


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` A complete understanding of management requires anappreciation of, classical, behavioral, and quantitativeapproaches.

` The systems and contingency perspectives can helpmanagers integrate the three approaches and enlargeunderstanding of all three.


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` The 7-S framework of McKinsey is a ValueBased Management (VBM) model thatdescribes how one can holistically andeffectively organize a company. Together thesefactors determine the way in which a

corporation operates.


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`

Skills: the capabilities and competencies that existwithin the company. What it does best.

` Sha r ed values: the values and beliefs of the company.Ultimately they guide employees towards 'valued'

behavior.

` Staff: the company's people resources and how the aredeveloped, trained and motivated.

` Style: the leadership approach of top management andthe company's overall operating approach.


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