Presentation on theme: "Chapter 2: The Management Movement"— Presentation transcript:
1 Chapter 2: The Management Movement Section 2.1:The Evolution of Management
2 The Industrial Revolution Began in the United States in 1860Just before the Civil WarPeriod during which a country develops an industrial economyBefore the Industrial Revolution, economy based on agricultureBy the late 1800s, economy depended on industries such as oil, steel, railroads, and manufactured goods
3 Causes of the Industrial Revolution Many people left their farms to work in factoriesProfessional managers supervised their workChanges in technology, communication, and transportationTelegraph and cable lines extended across the U.S. after the Civil WarRailroad lines, canals, roads, steamships
4 Captains of IndustryCornelius Vanderbilt (steamships & railroads)John D. Rockefeller (Oil)Andrew Carnegie (steel)James B. Duke (tobacco)J. P. Morgan (banking)Powerful businesspeople who created enormous business empires dominated and shaped the U.S. economy
5 Creation of Monopolies The captains of industry often pursued profit and self-interest above all elseDrove competitors out of businessCreated giant companies that maintained monopolies in their industriesMonopolyOccurs when one party maintains total control over a type of industryTrust: giant industrial monopolyBy 1879, Rockefeller controlled >90% of the country’s refining capacity and pipelines
6 The Break-Up of TrustsPeople became worried about the concentration of wealth in the hands of a only a fewIn response, the government began regulating businessCornelius Vanderbilt
7 The Break-Up of Trusts The Interstate Commerce Act, 1887 The railroads gave rebates to some customers but not othersThis act forced railroads to publish their rates and forbade them to change rates without notifying the publicEstablished the Interstate Commerce Commission (ICC) to supervise the railroads
8 The Break-Up of Trusts The Sherman Act, 1890 Made it illegal for companies to create monopoliesIntended to restore competitionExampleStandard Oil Company was broken into smaller companies so that other oil companies could compete with the former giantJohn D. Rockefeller
9 New Challenges for Management When most Americans worked on farms, sophisticated management techniques were not necessaryBy the end of the nineteenth century, giant companies employed thousands of people and distributed products all over the countryWorkers performed tasks that needed to be coordinatedThese changes demanded new ideas about how to manage people working in large corporations
10 Frederick W. Taylor and Scientific Management Wanted to find ways to motivate workers to work harderTo increase efficiency, he tried to figure “one best way” to perform a particular taskUsed a stopwatch to determine which work method was most efficientThese time and motion studies lead to scientific management principles
11 Frederick W. Taylor and Scientific Management Scientific management seeks to increase productivity and make work easier by carefully studying work procedures and determining the best methods for performing particular tasks
12 Frederick W. Taylor and Scientific Management Employers should gather, classify, and tabulate data in order to determine the “one best way” of performing a task or series of tasks.Employers should study worker strengths and weaknesses and match workers to jobs. Employers should also train employees in order to improve their performance.The principles of scientific management should be explained to workers.Management and workers should be interdependent so that they cooperate.
13 Frederick W. Taylor and Scientific Management Companies today continue to use the principles of scientific managementMarriott CorporationCustomer satisfaction
14 The Hawthorne Studies of Productivity Researchers began to look at the relationship between working conditions and productivitySeries of experiments at the Hawthorne plant of Western Electric in Cicero, ILLowered the lighting expecting productivity to fallWhat happened?
15 The Hawthorne Studies of Productivity Baffled by results, a team of psychologists from Harvard University were called uponOver five years, hundreds of experiments were conducted at the plantDifferent wage paymentsRest periodsWork hoursWhat were the results?
16 The Hawthorne Studies of Productivity Researchers concluded that productivity rose because workers worked harder when they received attentionHawthorne effectChange of any kind increases productivityFactors other than the physical environment affected worker productivityPsychological and social conditions, effective supervision
17 Abraham H. Maslow and the Hierarchy of Needs According to MaslowAll people have five basic types of needsPeople fulfill lower-level needs before seeking to fulfill higher-level needsOne set of needs must be met before another is sought“Hierarchy of needs” is his grouping and ordering of physical, security, social, status, and self-actualization needs
19 Applying Maslow’s Theory to Management At the lowest level, workers are motivated by basic needsWages or salary, physical conditionsSafety or security needsProviding insurance, retirement benefits, job securitySafe from physical, psychological, or financial harm
20 Applying Maslow’s Theory to Management Social needsProvide a work environment in which colleagues interactCompany lunch rooms, company retreatsStatus needsProvide workers with signs of recognition that are visible to othersJob titles, private offices, designated parking spaces, awards, promotions
21 Applying Maslow’s Theory to Management Self-fulfillment needsProvide employees with opportunities to be creative at workInclude employees in decision makingExampleITT’s Ring of Quality Control