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Contemporary Management Principle
Lesson 1: The Evolution of management theory
The Classical Approach to Management
Why do managers need to study the history of management theory? :
- Because of change. Changes the social, political economical, technology,
international and ecological environments have an effect on management.
The premise of the classical approach to management is that organisations are rational
systems that should operate in the most efficient manner possible. The three management
theories are
- 1. Scientific management approach – is focused on production efficiency
- 2. Bureaucratic management approach – is focused on the structure of organisations
- 3 .Administrative management approach – is focused the process and principles of
management
Scientific Management
Scientific management – Scientific management focused on production efficiency
Fredrick W Taylor (1856-1915)
Credit Taylor as the originator of the scientific management era, where is fact his crucial role
in the development of scientific management was that he was the personification of an
idea.
Advocated five simple principles:
- 1. Managers should carry the responsibility for the planning, design and
organisations of work and workers should implement the work. This principle of
separating the planning and design of work from its execution is the most criticised
and far-reaching element of Taylor’s approach to management.
- 2. Use scientific methods to establish the most efficient way of doing work and
design jobs by specifying the exact way the worker should do it.
- 3. Select the best person to do the work.
- 4. Provide training to the worker to do the work.
- 5. Monitor the performance of the worker to make sure that it is in accordance with
the prescribed procedures
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,Henry L Gantt (1861-1919)
Focused his research on control systems for production scheduling and developed the still
relevant Gantt chart for scheduling multiple overlapping tasks over a specific period.
Emphasised the importance of people and their motivation at work and developed
motivational schemes that emphasised the greater effectiveness of rewards for good work.
He developed a pay incentive system with a guarantee minimum wage and bonus system
for people with fixed wages
Frank Bunker Gilberth (1868-1924)
Pioneer in the field of motion study. His research focused on eliminating waste, reducing
fatigue, and increasing worker productivity by finding “the best one to work”. He identified
17 work elements and called them therbligs (his surname backwards).
Lillian Evelyn Moller Gilbreth (1878-1972)
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,Lillian an industrial psychologist, studied individual workers and their performance under
stressful conditions. She advocated standard working days, scheduled breaks and normal
lunch periods. She bought about the cooperation between scientific management and
applied psychology – a crucial step in the evolution of management.
Morris L Cooke (1872-1960)
Introduced the concept of efficiency to educational and municipal organisations and added
fresh ideas to scientific management. He advocated more participation by workers and he
appealed to leaders to assist organised labour.
Bureaucratic Management
Max Weber (1864-1920)
Born in Germany and developed the bureaucratic model which is a rational method of
structuring complex organisations
Charismatic organisations
Charismatic organisations are organisations with charismatic leaders who have exceptional
powers or qualities.
Traditional Organisations
Traditional organisations are an organisation where subordinates obey people who occupy a
formal position of authority. In such organisations, the basis of authority is a belief in the
legitimacy of the status of the people who exercise authority and implies that because a
person occupies a formal position authority, subordinates should obey him or her. (Weber
thinks this is not efficient because it is based on custom not competence)
Rational-
Rational-legal organisations have a bureaucratic form.
As a basis of his theory, Weber compared the bureaucracy with the traditional organisation.
He concluded that bureaucracies are more powerful and more responsive to authority
because of 4 elements:
- Differentiation - An intensive division of labour, a hierarchy of authority, and a clear
separation of official duties from personal interests and obligations.
- Integration - Bureaucracies have written rules and regulations, codified procedures
for selection and advancement of official, and a specialised administrative staff
charged with maintaining these rules and procedures.
- Constraints – Strict subordination requires all actions to be justified in terms of the
larger purpose of the organisation, the norm of impersonality requires detachment
and objectivity and advancement is contingent on both seniority and performance.
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, - Incentives – The prospect of a lifetime career, salaries paid in cash rather than kind,
and social esteem attached to the status of the official.
Major characteristics of a bureaucracy
Organisational Activity Related Management Activity
Formulating goals, decision-making and · Top-down goal-setting
using power · Centralised power
· Preference for larger units
· Leaders control, monitor and set
objectives by using formal authority
· Strict hierarchy
Controlling the flow of resources into and · The organisation as a unit of analysis
out of the organisation and establishing · The boundaries are clearly specified
boundaries · Reliable and replicable
· Vertical
· Rule-based
· Assets linked to organisational units
Differentiating functions and roles, · Specialised roles
establishing duties and rights including · Clear role definitions
governance · The removal of uncertainty
· Relative permanence
· Efficiency-orientated
Administrative (or process) management
Administrative management: The functions of managers within a framework of clear
guidelines or principles.
Developed by Henri Fayol (1841-1925). This is the first attempt to define the functions of
managers within a framework of clear guidelines or principles.
Foyal viewed administration (or management) as one of six functional areas of
management, the others being technical operations, commercial operations, financial
operations, security and accounting.
Foyal identified 5 activities (or management functions), comprising the administrative (or
managerial) role:
· Planning/forecasting
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