2. Spring 2007History of Management Thought1 The History of Management Thought

3. Spring 2007History of Management Thought2 Why Management History? To add perspective to the present…nothing new under the sun To understand where ideas came from To see the role of social, legal, political, economic, technological factors

4. Spring 2007History of Management Thought3 Management in the Past Management existed, but….. –Often hereditary (usually male…) –One-trial learning –But, some thought about management

5. Spring 2007History of Management Thought4 First large state Centralized government –Provincial governors (nomarchs) –Bureaucrats (taxation, irrigation) –Based on writing (first Information Revolution) Large scale construction projects –Pyramids, Sphinx, temples –Workforce: thousands of peasants, possibly slaves (prisoners of war) The Case of Egypt

6. Spring 2007History of Management Thought5 Sun Tzu and The Art of War Dates uncertain – –Some say he lived ca. 544 BC to 496 BC –Others place it closer to 600 BC A renowned Chinese general The Art of War a work on military strategy, but seen in Asia as a guide to management Principles: –Moral cause for battle –Leadership – wise, courageous, benevolent yet strict –Awareness of environmental conditions – events and the playing field –Organization and discipline –Espionage

7. Sun Tzu and The Art of War “Now the general who wins a battle makes many calculations in his temple ere the battle is fought. The general who loses a battle makes few calculations before hand. It is by attention to this point that I can see who is likely to win or lose.”

8. Spring 2007History of Management Thought7 Farming in Rome Cato the Elder (234 - 149 BC) De re rustica or Roman Farm Management Instructions for the management of a commercial farm –Absentee landlord –Based on slave labor –Wine grapes or olives

9. Spring 2007History of Management Thought8 Cato’s Advice “ When the weather is bad and field work cannot go on, carry the manure out to the manure heap. Clean thoroughly the ox stable, the sheep pen, the yard…” How an olive orchard…should be equipped…a foreman, a foreman’s wife, five laborers, three ox drivers, one ass driver, one swineherd, one shepherd, thirteen persons in all….” “Have the work oxen cared for with the greatest diligence and to some degree flatter the ox drivers so that they will more cheerfully care for the oxen” When the head of the household comes to the farmhouse...he should make the round of the farm; if not on the same day at least on the next. Planning Organizing Leading Controlling

11. Spring 2007History of Management Thought10 The Industrial Revolution A long-term process, not a single event –Protestant Work ethic –Political changes (American, French revolutions) –Invention of steam power Some important figures: –Adam Smith (1776) –James Watt, Eli Whitney

12. Spring 2007History of Management Thought11 The Industrial Revolution – New Technology Manufacturing –Steam engines –Cotton gin –Mass production through standardization and specialization Transportation –Steam powered ships –Railroads Communications –Telegraph

13. Spring 2007History of Management Thought12 Large Organizations and New Approaches to Management Economic transformation –Previously – family farms, small workshops –After Industrial Revolution – large organizations, requiring management skills New demands on management –Need for professional managers (as opposed to owners) –Need to plan, structure, and schedule activities –Push to efficiency –Need for worker training and socialization to factory work

14. Spring 2007History of Management Thought13 The Fortune 500: When Were They Founded?

15. Spring 2007History of Management Thought14 Classical Management Time period: last half of 1800’s, first part of 1900’s Environment: –Social / Political: little restraint (Robber Barons) –Economic: manufacturing economy, focus on efficiency –Technology: most jobs relatively simple Major schools –Scientific management –Administrative management theory

16. Spring 2007History of Management Thought15 Scientific Management Bottom- up approach Focus on efficiency, primarily in industrial settings Today: industrial engineering, production management Key players: –Frederick W. Taylor –Frank and Lillian Gilbreth

17. Spring 2007History of Management Thought16 General Principles Standard methods for performing jobs Push to efficiency Employee selection and training Management control over work processes Wage incentives for output

18. Spring 2007History of Management Thought17 F. W. Taylor and Scientific Management Worked at Midvale Steel (beginning as a common laborer, rising to chief engineer, in 6 years) Identified “soldiering” –Workers doing less than they were capable of –Due to lack of training, fear of losing work or rate cuts Began with time study and incentive plans Pig iron study: the right shovel for each job

19. Spring 2007History of Management Thought18 Frank and Lillian Gilbreth: The One Best Way Focus on work simplification and efficiency –Reduce time and fatigue (Frank) –Involve workers (Lillian) “The One Best Way” Therbligs

21. Spring 2007History of Management Thought20 Scientific Management: Recap Contributions: –Pay for performance –Careful examination of job tasks –Importance of training and selection But……..* –Assumed workers were robots without social needs or higher order needs –Assumed all individuals were the same –Ignored worker’s potential to contribute ideas, not just labor * These are Taylor’s ideas; Gilbreths thought differently

22. Spring 2007History of Management Thought21 Administrative Management Theory Top-down approach Focus on rationality, no matter what the setting Today: basis of most management texts Key players: –Henri Fayol –Max Weber

23. Spring 2007History of Management Thought22 Henri Fayol French manager (coal mining) Published Industrial and General Administration in 1916 (not translated into English until 1930’s) Elements of management –Planning –Organizing –Command, Coordination, Control Fourteen principles Universality of management Management as a skill can be taught

24. Spring 2007History of Management Thought23 Fayol’s 14 Principles 1.Specialization of labor 2.Authority 3.Discipline 4.Unity of command 5.Unity of direction 6.Subordination of individual interests 7.Remuneration 8.Centralization 9.Scalar chain (line of authority) 10.Order 11.Equity 12.Personnel tenure 13.Initiative 14.Esprit de corps

25. Spring 2007History of Management Thought24 Max Weber and Authority Traditional –Inherited - monarchs Charismatic –Based on the individual Rational – Legal –Based on the position

26. Spring 2007History of Management Thought25 Max Weber and Bureaucracy Bureaucracy = management by the office (Büro) Weber well aware that bureaucracy could become an end in itself Bureaucracy –Clearly defined division of labor, authority, responsibility –Offices organized in a hierarchy –Recordkeeping (organizational memory and continuity separate from individuals) –Selection on the basis of qualifications –Officials appointed, not elected –Administrators work for fixed salaries, on a career basis –Administrators are not owners –Administrators subject to impersonal rules, discipline, control

27. Spring 2007History of Management Thought26 Human Relations Movement and Subsequent Developments Hawthorne Studies Mary Parker Follett Chester Barnard

28. Spring 2007History of Management Thought27 Hawthorne Studies Western Electric plant, Hawthorne Illinois, 1930’s Mayo, Roethlisberger and Dickson Original idea: effect of lighting on productivity Three phases –Relay Assembly Test Room (social nature of work, effect of supervision) –Bank Wiring Room (group norms) –Interview program The “Hawthorne Effect”

29. Spring 2007History of Management Thought28 Theory and Practice Mary Parker Follett –Primarily a political thinker, theoretical writer –Emphasized the importance of the group Chester Barnard –AT & T executive –Importance of communications –Authority -- exists only if accepted –Functions of the executive

30. Spring 2007History of Management Thought29 The Last Fifty Years Management science Systems theory Motivation and leadership Contingency models

31. Spring 2007History of Management Thought30 Management Science Different from "scientific management” Formative years: 1940's to 1960's Operations research Uses a quantitative basis for decision making - mathematical models Emphasis on managing production and operations

32. Spring 2007History of Management Thought31 Systems Approach Formative years: 1950's to 1970's Views an organization as a group of inter-dependent functions contributing to a single purpose Important contributor: U.S. Department of Defense

33. Spring 2007History of Management Thought32 Motivation and Leadership (1950’s and 1960’s) Late 1950's: Douglas McGregor proposed his Theory X and Theory Y assumptions of the relations between Early and mid 1960's: contingency models of leadership proposed a need for different styles under different circumstances (Fred Fiedler) 1964: Vroom's VIE theory (valence, instrumentality, expectancy) of motivation proposed Mid 1960's: David McClelland proposed need for achievement theory Late 1960's: Frederick Herzberg proposed his two-factor theory of motivation (motivators and hygiene factors) Late 1960's: Edwin Locke outlined his goal setting approach to motivation

34. Spring 2007History of Management Thought33 Situational (Contingency) Formative years: 1970's to 1990's Is there “One Best Way” ???? –Appropriate practice depends on the situation Found in: –Organization design –Leadership