1. WEEK 3: The evolutION OF MANAGEMENT THOUGHT
BUSN 107 – Özge Can

2. The Evolution of Management Thought
How management thought have evolved over time
The economic, political and cultural forces affected the development of management theories
How managers and organizations have changed their behavior

3. The Evolution of Management Thought
Classical management theories (around the turn of the 20th century)
Behavioral management theories (before and after World War II)
Management science theory (from WWII onward)
Management environment theories (from the middle to the late 20th century)

4. The Evolution of Management Thought
Organizational Environment Theory
Management Science Theory
Behavioral Management Theory
Administrative Management Theory
Scientific Management Theory

5. Evolution of modern management began in the late 19th century, after industrial revolution

6. Scientific Management Theory
Industrial revolution through Europe and America
Many major economic, technical and cultural changes
Introduction of steam power
Sophisticated machinery and equipment
Change from small-scale crafts production to large- scale mechanized manufacturing

7. Mechanized Manufacturing
Small-scale
Crafts Production
Large-scale
Mechanized Manufacturing

8. Scientific Management Theory
The systematic study of relationships between people and tasks for the purpose of redesigning the work process to increase efficiency
Developed by Frederick W. Taylor ( )
Job Specialization: The process by which division of labor occurs as different workers specialize in different tasks over time

9. Better Organizational
Job Specialization
Division of Labor
Taylor believed that if the amount of time and effort that each worker expends to produce a unit of output can be reduced by increasing specialization and division of labor, the production process will become more efficient.
Better Organizational
performance
Increased Efficiency

10. Taylor’s Principles
1. Study the way workers perform their tasks, gather all informational job knowledge that workers possess, and experiment with ways of improving how tasks are performed

11. Taylor’s Principles
2. Codify the new methods of performing tasks into written rules and standard operating procedures. 3. Carefully select workers who possess skills and abilities that match the needs of the task, and train them to perform the task according to the established rules and procedures.

12. Taylor’s Principles
4. Establish a fair or acceptable level of performance for a task, and then develop a pay system that provides a reward for performance above the acceptable level.

13. More harm than good...
As workers’ performance increased, managers required them to do more work for the same pay
Increases in performance meant fewer jobs and greater threat of layoffs
Monotonous, repetitive and boring work
Increasing dissatisfaction of workers
Deterioration in workers’ well-being

14. Modern Times, 1936 film by Charlie Chaplin

15. Ford Motor Company
Achieving the right mix of worker-task specialization as Taylor suggests
Linking people and tasks by the speed of the production line

16. Videos on Taylorism:
eature=related

17. Administrative Management Theories
The study of how to create an organizational structure that leads to high efficiency and effectiveness
Theory of Bureaucracy
Fayol’s Principles of Management

18. Theory of Bureaucracy Max Weber (1864-1920)
Developed the principles of bureaucracy-a formal system of organization and administration designed to ensure efficiency and effectiveness.
Bureaucracy: A formal system of organization and administration designed to ensure efficiency and effectiveness

19. A bureaucracy should have
System of written rules and
SOPs that specify how
employees should
behave
Clearly specified
hierarchy of
authority
Clearly specified
system of task and
role relationships
A bureaucracy
should have
Selection and evaluation
system that rewards
employees fairly and
equitably

20. Weber’s Principles of Bureaucracy:
A Manager’s formal authority derives from the position he or she holds in the organization
People should occupy positions because of their performance, not because of their social standing or personal contacts.

21. Weber’s Principles of Bureaucracy:
The extent of each position’s formal authority and task responsibilities and its relationship to other positions in an organization, should be clearly specified.
Authority can be exercised effectively in an organization when positions are arranged hierarchically, so employees know whom to report to and who reports to them.

22. Weber’s Principles of Bureaucracy:
Managers must create a well-defined system of rules, standard operating procedures and norms so that they can effectively control behavior within an organization.

23. Fayol’s Principles of Management
Henri Fayol ( )
He identified 14 principles he believed essential to increase the efficiency of the management processs.

25. Behavioral Management Theories
The Work of Mary Parker Follett
The Hawthorn Studies and Human Relations
Theory X and Y
Behavioral Management:
The study of how managers should behave to motivate employees and encourage them to perform at high levels and be committed to the achievement of organizational goals.

26. Mary Parker Follett
Mary Parker Follett advocated for a human relations emphasis
Her work contrasted with the "scientific management" of Frederick W. Taylor
Stressed the interactions of management and workers
Advocated involvement of workers in job analysis and work development process
Differentdepartments should communicate with each other directly (Cross-functioning)

27. The Hawthorne Studies and Human Relations
Hawthorn Effect: The finding that a manager’s behavior or leadership approach can affect worker’s level of performance.
Human Relations Movement: Advocates of the idea that supervisors receive behavioral training to manage subordinates in ways that elicit their cooperation and increase their productivity.

28. The Hawthorne Studies and Human Relations
Informal Organization: The system of behavioral rules and norms that emerge in a group.
Organizational Behavior (OB): The study of the factors that have an impact on how individuals and groups respond to and act in organizations.

29. Theory X and Theory Y
Douglas McGregor proposed that two sets of assumptions about how work attitudes and behaviors not only dominate the way managers think but also affect how they behave in organizations.
He named these two assumptions Theory X and Theory Y.

30. Theory X and Theory Y Theory X: Theory Y:
A set of negative assumptions about workers
A manager’s task is to supervise workers closely and control their behavior
Theory Y:
A set of positive assumptioms about workers
Encouraging commitment, provide opportunities to exercise initiative and self- direction

32. Management Science Theory
An approach to management that uses rigorous quantitative techniques to help managers make maximum use of organizational resources.
Quantitative Techniques
Operations Management
Total Quality Management
Management Information Systems

33. Organizational Environment Theory
The set of forces and conditions that operate beyond an organization’s boundaries but affect a managers ability to acquire and utilize resources.
The Open-System View
Contingency Theory

34. Organizational Environment Theory
Open-System:
A system that takes in resources from its external environment and convert them into goods and services that are then sent back to the environment for purchase
Closed-systems: Are not influenced by and do not interact with their environment (all system input and output is internal)

35. The Organization as an Open-System:

36. Organizational Environment Theory
Contingency Theory:
The idea that the organizational structures and control systems depend on characteristics of the external environment in which the organization operates.
No one universally applicable set of management principles by which to manage organizations.
Organizations face different situations and require different ways of managing.

37. Next Week: Read: Remember:
Textbook, Chapter 3 – The Manager as a Person
Remember:
Deadline for Assignment-1