Theories of Management and History Thereof
Both
theory and history of management are useful to the practicing manager. Theories
help us by organizing information and providing a systematic framework for action.
A theory is also a simple blueprint or a road map guiding the manager toward achieving
organizational goals. The history of management theories can help a manager to be
aware of the many insights, ideas, and scientific underpinnings that have gone into
the making of modern management and the burgeoning of writings on management at
the present day.
A good
manager works with a sound consciousness of the historical development of modern
management.
The practice
of management started when man first attempted to accomplish goals by working together
in groups. But the systematic study of management began at the advent of the Industrial
Revolution which ushered in a new era of serious thinking and theorizing on management.
At this stage it is considered important and worthwhile to have some knowledge of
the background of the evolution of modern management thought, for then the growth
of modern thinking on management can be appreciated as the fruit of a long-going
historical process and development.
To begin
with, there is no single universally accepted theory. The wild array of management
theories could even look like a “jungle” as Koontz says. However, to help put the
different theories in perspective, we shall discuss them as representing different
schools of management thought.
Management
theories are too many for any single one to be universally acceptable.
Classical School of Management Thought
Scientific
Management and F.W. Taylor
Scientific
management, according to an early definition, refers to “that kind of management
which conducts a business or affairs by standards established by facts or truths
gained through systematic observation, experiment, or reasoning.” Promoters of this
school of thought attempted to raise labor efficiency primarily by managing the
work of employees on the shop floor.
Frederick
Winslow Taylor (1856-1915) is generally acknowledged as “the father of scientific
management.” Because of an eye problem, he could not attend Harvard University.
As a result, he started working as a common laborer in a small machine shop in Philadelphia,
USA. Later on, he worked as an apprentice, a foreman, and a master mechanic and
rose to the eminence of a chief engineer of a steel company after obtaining a degree
in engineering through evening study. This varied experience gave him ample opportunity
to have firsthand knowledge and intimate insight into the problems and attitudes
of workers and to explore great possibilities for improving the qualities of management
in the workplace. Wherever he worked, he found a very ineffective use of employees,
unsystematic methods of work, and utterly poor cooperation between management and
labor. He also observed gross inefficiency, waste, and widespread output restriction
among workers which he termed “systematic soldering.” Hence Taylor committed himself
to the relentless pursuit of “finding a better way” and developing and practicing
the “science” of work - the underlying laws or principles that govern various activities.
He attempted to do it by using the systematic study of time, motion, and fatigue
involved in work to identify the best way of doing a job.
Taylor
used his firsthand experience to formulate his theory. The focus of his theory is
to increase the efficiency of employees by molding their thoughts and scientific
management.
Taylor’s
major concern throughout his life was to increase efficiency which he considered
the best recipe to serve the competing interests of both managers and workers for
a larger share of a fixed economic pie. To him, the solution lies in increasing
the size of the pie by raising productivity through scientific management. He called
for a “mental revolution” or a radical change of mind among workers and management
to fuse the interests of both groups into a mutually rewarding one.
Mental
Revolution and Tylor’s Principles The mental revolution, propounded by Taylor, was based on
five vital principles:
(1) Replacing
rules of thumb with science (organized knowledge).
(2) Obtaining
harmony in the group action, rather than discord.
(3) Achieving
cooperation of human beings, rather than chaotic individualism.
(4) Working
for maximum output, rather than restricted output.
(5) Developing
all workers to the fullest extent possible for their own and their company’s highest
prosperity.
Taylor's
theory of scientific management gave rise to a host of disciples who took up the
task of spreading the “gospel of efficiency.” Carl Barth, Henry Gantt, Frank and
Lillian Gilbreth, Harrington Emerson, and Morris Cook are his prominent followers
who made valuable contributions to the growth of management in a scientific manner.
The essence of this school of thought is to make constant endeavors to find better
means of management using scientific methods. Historically, it is associated with
economic considerations such as cost-effectiveness, efficiency, and productivity.
The essence
of Taylor’s scientific method is to manage an enterprise with an emphasis on economic
considerations such as cost-effectiveness, efficiency, and productivity.
The Universal
Process or Operational Management Theory and Henry Fayol
As one
of the oldest and most popular approaches to management thought, Henry Fayol’s theory
holds that the administration of all organizations – whether public or private or
“large or small” – requires the same rational process or functions. This school
is based on two assumptions: first, although the objective of an organization may
differ (for example, business, government, education, or religion), there is a core
management process that remains the same for all institutions. Successful managers,
therefore, are interchangeable among organizations of differing purposes. Second,
the universal management process can be reduced to a set of separate functions and
related principles.
According
to Fayol, the same rational process is involved in the administration of any organization,
and the process of management is reducible to a universal set of functions and principles.
It has rightly been said by some scholars that “perhaps the real father of modern
management theory is the French industrialist Henri Fayol.” Despite the belated
appearance of his classic work, Administration Industrially et Generali,
in the English-speaking world, Fayol's book has left a permanent mark on twentieth-century
management thinking. A successful industrialist, Fayol headed a steel and coal combine
in France. He is now considered the father of the universal process or operational
management theory because he made universal generalizations about management based
on his keen insight and practical management experience. As opposed to Taylor, Fayol
endeavors to deal with "classical administration." He focuses his attention
on the enterprise as a whole rather than on a single segment of it. He pioneered
the concept of viewing management as being made up of functions, and his work supplied
a comprehensive framework from which management could be studied and developed He
also repeatedly emphasized that his principles apply not only to business but also
to political, religious, philanthropic, military, and other undertakings.
Fayol
views management as comprising functions that can roundly control an organization.
His theory attempts to formulate a broad-based management that can equally apply
to other institutions.
Industrial
Activities Identified by Fayol
Fayol
identifies the following six major activities of any industrial or business organization:
(1) Technical
(production and manufacturing);
(2) Commercial
(buying, selling, and exchanging);
(3) Financial
(search for and optimum use of capital);
(4) Security
(safeguarding property and people);
(5) Accounting
(including statistics); and
(6) Managerial
(planning, organization, command, coordination, and control)
While
pointing out the existence of these activities in business of any kind or size,
Fayol particularly stresses the analysis of the sixth, devoting a substantial portion
of his book (mentioned earlier) to this aspect of management.
Fayol’s Principles of Management
In addition
to these six management activities, Fayol identifies fourteen universal principles
of management which are aimed at showing managers how to carry out their functional
duties. He followed them:
1. Division
of labor: This improves the efficiency of labor through specialization, reducing
labor time and increasing skill development.
2. Authority:
This is the right to give orders which always carry responsibility commensurate
with its privileges.
3. Discipline:
It relies on respect for the rules, policies, and agreements that govern an
organization. Fayol ordains that discipline requires good superiors at all levels.
4. Unity
of command: This means that subordinates should receive orders from one superior
only, thus avoiding confusion and conflict.
5. Unity
of direction: This means that there should be unity in the directions given
by a boss to his subordinates. There should not be any conflict in the directions
given by a boss."
6. Subordination
of individual interest to the common good: According to this principle, the
needs of individuals and groups within an organization should not take precedence
over the needs of the organization as a whole.
7. Remuneration:
Wages should be equitable and satisfactory to employees and superiors.
8. Centralization:
Levels at which decisions are to be made should depend on the specific situation,
no level of centralization or decentralization is ideal for all situations.
9. Scalar
chain: The relationship among all levels in the organizational hierarchy and
exact lines of authority should be unmistakably clear and usually followed at all
times, excepting special circumstances when some departure might be necessary.
10. Order:
Here Fayol means that there should be a place for everything (and everyone),
and everything (and everyone) should be in its place. This is essentially a principle
of organization in the arrangement of things and people.
11. Equity:
Employees should be treated equitably to elicit loyalty and devotion from personnel.
12. Stability
of tenure: Viewing unnecessary turnover to be both the cause and the effect
of bad management, Fayol points out its danger and costs.
13. Initiative:
Subordinates should be encouraged to conceive and carry out ideas.
14. Esprit
de corps: Teamwork, a sense of unity and togetherness, should be fostered and
maintained.
Fayol
thought that the application of these principles should be flexible enough to match
each specific organizational situation. Subsequently, however, the rigid application
of these functions by managers came under criticism. But the fact remains that his
contention that management is a continuous process beginning with planning and ending
with controlling also remains popular today and can be found in nearly all management
texts.
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2024-07-12 01:45:07