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Chapter 2 The History of Management

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1 Chapter 2 The History of Management
MGMT Chuck Williams Designed & Prepared by B-books, Ltd.

2 In the Beginning explain the origins of management.
After reading the next section, you should be able to: explain the origins of management.

3 Management Ideas and Practice Throughout History
5000 BC BC 1800 BC 600 BC 500 BC 400 BC 175 284 900 1100 1418 1436 1500 1525 Sumerians Egyptians Planning, organizing, controlling. Hammurabi Nebuchadnezzar Sun Tzu Xenophon Cyrus Cato Diocletian Alfarabi Ghazali Barbarigo Venetians Sir Thomas More Machiavelli Record keeping Plan, organize, control. Written requests. Controls and written documentation Wage incentives, production control Strategy Management as a separate art Human relations and motion study Job descriptions Delegation of authority Listed leadership traits Listed managerial traits Different organizational forms/structures Numbering, standardization, interchangeability Critical of poor management and leadership Cohesiveness, power, and leadership Only 125 years ago, business ideas and practices were very different from today’s widely accepted management ideas. Management wasn’t even a field of study, and there were no management jobs or management careers. This chapter presents origins of management ideas and practice throughout history and the historical changes that produced the need for managers. On this slide are some of the management examples that can be found throughout history, and how they are related to the management functions in the textbook. 1.1

4 Why We Need Managers Today
Work in families Skilled laborers Small, self-organized groups Unique, small batches of production Then Work in factories Specialized, unskilled laborers Large factories Large standardized mass production Now 1.2

5 The Evolution of Management
After reading the next four sections, you should be able to: explain the history of scientific management. discuss the history of bureaucratic and administrative management. explain the history of human relations management. discuss the history of operations, information systems, and contingency management.

6 The History of Scientific Management
Studies and tests methods to identify the best, most efficient ways “Seat-of-the Pants” Management No standardization of procedures No follow-up on improvements Before scientific management, organizational decision making could best be described as ‘seat-of-the-pants.” Decisions were made haphazardly with no standardization of procedures, systematic study, or collection of information. In contrast, scientific management thoroughly studied and tested different work methods to identify the best, most efficient ways to complete a job. 2

7 Frederick W. Taylor Frederick Taylor is known today as the father of scientific management. One of his many contributions to modern management is the common practice of giving employees rest breaks throughout the day. 2.2

8 Taylor’s Four Management Principles
Develop a science for each element of a man’s work, which replaces the old rule-of-thumb method. Scientifically select and then train, teach, and develop the workman. Cooperate with the men to insure all work is done in accordance with the principles of the science. Frederick W. Taylor, the “father of scientific management,” spent three years to improve output of workers who were deliberately restricting output. His principles are described on this slide. Taylor’s key ideas have stood the test of time. These include: using systematic analysis to identify the best methods scientifically selecting, training, and developing workers promoting cooperation between management and labor developing standardized approaches and tools setting specific tasks or goals and then rewarding workers with financial incentives giving workers shorter work hours and frequent breaks There is almost equal division of the work and the responsibility between management and workmen. 2.1

9 Frank & Lillian Gilbreth
Frank and Lillian Gilbreth were prolific researchers and often used their family as guinea pigs. Their work is the subject of Cheaper by the Dozen, written by their son and daughter. In addition to their use of motion studies to simplify work, Frank and Lillian Gilbreth also made significant contributions to the employment of handicapped workers and industrial psychology. Lillian Gilbreth, the first woman to receive a Ph.D. in Management, also convinced the government to enact laws regarding workplace safety, ergonomics, and child labor. 2.2

10 Motion Studies: Frank & Lillian Gilbreth
Time Study Timing how long it takes good workers to complete each part of their jobs. Motion Study Breaking each task into its separate motions and then eliminating those that are unnecessary or repetitive. In addition to their use of motion studies to simplify work, Frank and Lillian Gilbreth also made significant contributions to the employment of handicapped workers and industrial psychology. Lillian Gilbreth, the first woman to receive a Ph.D. in Management, also convinced the government to enact laws regarding workplace safety, ergonomics, and child labor. 2.2

11 Charts: Henry Gantt Henry Gant, in addition to creating the Gantt chart, made significant contributions to management with pay-for-performance plans and the training and development of workers. A Gantt chart shows time in various units on the x-axis and tasks on the y-axis, visually indicating what tasks must be completed at which times in order to complete a project. 2.3

12 The History of Bureaucratic Management
Max Weber, Bureaucracy The exercise of control on the basis of knowledge, expertise, or experience. When we hear the term bureaucracy, we think of inefficiency and “red tape”, incompetence and ineffectiveness. However, when German sociologist Max Weber proposed the idea of bureaucratic organizations, monarchies were associated with these problems. Bureaucracy literally means to rule from a desk or office. In a bureaucracy, people would lead by virtue of rational-legal authority—from knowledge, expertise, and experience. 3.1

13 The Aim of Bureaucracy 3.1 1. Qualification-based hiring
2. Merit-based promotion 3. Chain of command 4. Division of labor 5. Impartial application of rules and procedures 6. Recorded in writing 7. Managers separate from owners The aim of bureaucracy is to achieve an organization’s goals in the most efficient way possible. 3.1

14 Administrative Management: Henri Fayol
1. Division of work 2. Authority and responsibility 3. Discipline 4. Unity of command 5. Unity of direction 6. Subordination of individual interests 7. Remuneration 8. Centralization 9. Scalar chain 10. Order 11. Equity 12. Stability of tenure of personnel 13. Initiative 14. Esprit de corps Henri Fayol is best known for developing five functions of managers and 14 principles of management, as well as his belief that management could and should be taught to others. The five functions of successful management are: planning, organizing, coordinating, commanding, and controlling. His principles of effective management are shown on this slide. 3.2

15 The History of Human Relations Management
Efficiency alone is not enough to produce organizational success. Success also depends on treating workers well. Scientific management focuses on improving the efficiency of manufacturing facilities and their workers. Bureaucratic management focuses on using knowledge, fairness, and logical rules to increate the organization’s efficiency. Administrative management focuses on how and what managers should do in their jobs. In contrast, the human relations approach to management focuses on the psychological and social aspects of work. People are valuable organizational resources whose needs are important. 4

16 Mary Parker Follett Mary Parker Follett is known today as the mother of scientific management. Her many contributions to modern management include the ideas of negotiation, conflict resolution, and power sharing. 4.1

17 Constructive Conflict and Coordination: Mary Parker Follett
Dealing with Conflict Compromise Domination Integration Follett is known for developing ideas regarding constructive conflict and coordination. She said that conflict is the appearance of difference, difference of opinions, of interests. Follett believed that managers could deal with conflict in three ways, as shown on this slide. Domination is a victory of one side over the other. Compromise involves both parties giving up some of what they want in order to reach agreement. Integrative conflict resolution involves both parties indicating their preferences and then working together to find an alternative that meets the needs of both. 4.1

18 Constructive Conflict and Coordination: Mary Parker Follett
Coordination as reciprocal relating all the factors in a situation Coordination by direct contact of the responsible people concerned Coordination in the early stages Coordination as a continuing process Fundamental Principals of Organizations 4.1

19 Hawthorne Studies: Elton Mayo
Workers’ feelings and attitudes affected their work Financial incentives weren’t the most important motivator for workers Group norms and behavior play a critical role in behavior at work Elton May’s ideas became popular during the twentieth century when labor unrest and protests were widespread in the U.S., Europe and Asia. Mayo's work proved relevant as managers looked for ways to increase productivity and to improve worker satisfaction and working conditions. 4.2

20 Cooperation and Acceptance of Authority: Chester Barnard
Managers can gain cooperation by: Securing essential services from individuals Unifying people by clearly formulating an organization’s purpose and objectives Providing a system of effective communication Chester Barnard is best known for his ideas about cooperation, the executive functions that promote it, and the acceptance of authority. 4.3

21 Cooperation and Acceptance of Authority: Chester Barnard
People will be indifferent to managerial directives if they… are understood are consistent with the purpose of the organization are compatible with the people’s personal interests can actually be carried out by those people 4.3

22 Operations, Information, Systems, and Contingency Management
Information Management Operations Management Contingency Management Systems Management 5

23 Operations Management Tools
Quality control Forecasting techniques Capacity planning Productivity measurement and improvement Linear programming Scheduling systems Inventory systems Work measurement techniques Project management Cost-benefit analysis 5.1

24 Operations Management Tools
Origins of Operations Management Geometry Guns Fire The key elements of operations management had origins in guns, geometry, and fire. Firearms manufacturers needed standardized, interchangeable parts. Following the theories of Eli Whitney, machine tools were designed which allowed unskilled workers to make each gun part the same as the next. Geometry techniques were used for drawing three-dimensional objects on paper, based on a book by Gaspard Monge. These precise drawings permitted manufacturers to make standardized, interchangeable parts without examining a prototype. Finally, a problem with too much inventory was plaguing manufacturers. A solution to this problem occurred in 1905 when the Oldsmobile Motor Works burned down. Management rented a new production facility to begin production again, and there was no room to store inventory. Since all its suppliers were close by, Oldsmobile could place orders in the morning and receive them by afternoon—creating the first just-in-time inventory system. 5.1

25 Whitney, Monge, and Olds 5.2 Eli Whitney, 1765-1825
Gaspard Monge, Ransom Olds, 5.2

26 Information Management
Milestones in information management: 1400s Horses in Italy Creation of paper and the printing press Manual typewriter 1860s Vertical file cabinets and the telegraph Cash registers 1880s Telephone 1890s Time clocks 1980s Personal computer 1990s Internet A system is a set of interrelated elements or parts that function as a whole. A systems approach encourages managers to look for connections between the different parts of the organization. 5.3

27 Systems Management A system is a set of interrelated elements or parts that function as a whole. A systems approach encourages managers to look for connections between the different parts of the organization. 5.3

28 Biz Flix: In Good Company
Beyond the Book Biz Flix: In Good Company Is Carter Duryea’s explanation of synergy the same as the text definition? Dan identifies a potential downside with Carter’s plan. Do you agree with Dan or Carter? Take Two Video Click

29 Contingency Management
Contingency Approach Holds that the most effective management theory or idea depends on the kinds of problems or situations that managers are facing at a particular time and place. 5.4

30 Contingency Management
Management is harder than it looks Managers need to look for key contingencies that differentiate today’s situation from yesterday’s situation Managers need to spend more time analyzing problems before taking action Pay attention to qualifying phrases, such as “usually” 5.4

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