Who is Frederick Taylor?

Frederick Winslow Taylor (1856-1915) was born in Philadelphia, Pennsylvania.

As a teenager, Taylor spent time studying and traveling in Europe and enrolled in Phillips
Exeter Academy in New Hampshire in 1872.

After graduating, he was accepted into Harvard Law School but was unable to attend due
to poor eyesight.

Then, instead of going to university at that point, Taylor filled various manufacturing-
related roles, eventually earned a mechanical engineering degree from Stevens Institute of
Technology in 1883, and became Chief Engineer at Midvale Steel Works in Philadelphia.

Taylor's philosophies are sometimes described as Taylorism, and emphasize harmonious relations between
workers and management.
After resigning in 1890, he became General Manager of Manufacturing Investment
Company, but left the company in 1893 to develop the profession of engineering
management consulting. From 1906 to 1907, Taylor was the President of the American
Society of Mechanical Engineers and later became a professor at the Tuck School of
Business at Dartmouth College.

Taylor is best known for his 1911 book, “Principles of Scientific Management.” In this book,
he presented numerous principles of management that were based on the scientific
method and could improve the efficiency and productivity of industrial workplaces. 1

Due to this work, Taylor is known as the father of Scientific Management, which is also
known as “Taylorism.”2
The Philosophy Behind Scientific Management
In “the Principles of Scientific Management,” Taylor starts with the following statement:
“The principal object of management should be to secure the maximum prosperity for the
employer, coupled with the maximum prosperity for each [employee].”

In saying this, he meant that the organization and employees should work together, strive
to get the most out of one another, and be compensated for their efforts as it’s in
everyone’s best interests.

For workers in particular, taking this approach would mean that they could benefit from
higher wages, shorter working hours, and better work and home conditions.

Taylor's emphasis on pro-worker efficiency was ahead of it's time, but still impacts Western corporations today.

Taylor believed that the worker should be focused on labor, due to insufficient capacity
and/or education, while managers should be focused on and held accountable for
optimizing performance. Regarding their interaction, Taylor said that workers should be
taught daily and “receive the most friendly help from those who are over [them], instead of
being…driven or coerced [by bosses or left to their] own unaided devices.”

In fact, Taylor believed that training and development was “the most important object of
both the workmen and the management” in order to produce maximum efficiency and that
a “close, intimate, personal cooperation between the management and the [worker] is of
the essence of modern scientific or task management.”

So, while Taylor’s Theory of Scientific Management has often been painted as cold and
impersonal, it isn’t really the case; Taylor’s philosophy had good intentions for everyone
and problems come from poor application. Specifically, Taylor stated that poor application
came from:

1. Employees incorrectly believing that greater productivity would result in lost jobs;
2. “Defective systems of management” that work against employees and productivity;
3. An inability to leave behind traditional and habitually inefficient procedures; and
 4. Driving workers “against their wishes, and without much increase in pay, to work
much harder, instead of gradually teaching and leading them toward new methods.” 3

The Principles of Scientific Management Theory

In the early 1900s, the most common approach to management involved offering
incentive-based pay in order to promote initiative (labeled “initiative and incentive”).

This was described as workers giving “their best initiative and in return [receiving] some
special incentive from their employers.”

Instead, Taylor argued that getting initiative out of workers is rare and a better approach
would be to apply the scientific method in order to increase efficiency and performance.

Through his studies that used the scientific method, Taylor established Four Principles of
Management, including to:

In summary, Frederick Taylor’s four principles of Scientific Management are:

1. Develop a science for each element of work

2. Scientifically Select, Train, Teach, and Develop the worker
3. Cooperate with the Worker
4. Divide the Work and Responsibility

In his own words, these are:

1. “Develop a science for each element of…work”;

2. “Scientifically select and then train, teach, and develop the [worker]”;
3. “Cooperate with the [worker] so as to [ensure] all of the work [is] being done in
accordance with the principles of the science which has been developed”; and
4. Equally divide “the work and the responsibility between the management and the
[workers],” where “the management take over all work for which they are better
fitted than the [workers].”

Each of these principles will be described in the sections that follow. 4

Principle One: Develop a Science for each element of work

To begin, it is important to note that Taylor was not attempting to determine and force
upon workers “the maximum work that a man could do on a short spurt or for a few days.”

Rather, in “developing a science,” he wanted to know “the best day’s work that a [person]
could properly do, year in and year out, and still thrive.”

Thus, Taylor had a focus on long-term productivity, considering both the organization’s
and the workers’ perspectives.
With this focus in mind, when Taylor spoke of “developing a science” for each element of
work, he essentially meant that management should:

1. Gather objective data on work;

2. Perform experiments; and
3. Standardize policies and procedures based on the results of the experiments.

In order to gather objective data on work, Taylor would select “first-class laborers” to
perform a given task, pay them extra wages, and carefully examine and test them to ensure
that they were working “to the best of their ability at all times.” That way, optimal
productivity could accurately be determined.

Next, these workers would be observed while performing various procedures and timed,
using a stop-watch, in order to determine how much time was taken for each motion.

Then, after experimenting with different tools and/or procedures, which often included
varying rest intervals, the tools and/or procedure that would produce the optimal
productivity could be determined.

And finally, with optimal tools and/or procedures determined, such tools and/or
procedures could be documented and used as standard for a given task.

Principle Two: Scientifically Select, Train, Teach, and Develop the worker
Given the “science” of the task, Taylor then said that individuals “especially suited” for the
work should be selected. In his example of a pig-iron handler, he found that approximately
only one in eight current workers were capable of meeting the newly established
standards. That being said, he also determined that there were plenty of other internal and
external candidates that would be capable of fulfilling the role. Thus, combined, it was clear
to him that selection and correct assignment were critical to the theory of Scientific
Management.

Regarding training and development, if a worker was performing below standard, Taylor
believed that a “competent teacher should be sent to show [the worker] exactly how [their]
work can be best done, to guide, help, and encourage [them]…[and give them] the time
and the help required to make [them] proficient at [their] present job.”

However, if after studying the worker it was found that they would be unable to perform
according to standards, the worker should then be “shifted to another class of work for
which [they are] either mentally or physically better suited.” Therefore, training and
development were also important and inextricably connected to selection and assignment.

Otherwise, it is important to note that Taylor recommended gradual implementation of a

new science to a job. This is because it requires a “change in the mental attitude of the
[worker]” and “it is impossible to hurry it beyond a certain speed.”
In particular, he believed that “only one [worker] at a time should be dealt with…until this
single [worker] has been thoroughly convinced that a great gain has come to [them] from
the new method.” Then, after “one-fourth to one-third of the [workers]…have been
changed from the old to the new, very rapid progress can be made, because at about this
time there is…a complete revolution in the public opinion…[about] the new plan.”

Principle Three: Cooperate with the Worker

When speaking about the Bethlehem Steel Company, Taylor said that work should be
distributed among four parties and in the following fashion:

1. “One set of [employees]…engaged in the development of the science of laboring”;

2. “Another set of [employees], mostly skilled laborers themselves, who [are] teachers,
and who [help] and [guide] the [workers] in their work”;
3. “Another set of tool-room [employees] who [provide]…the proper implements and
[keep] them in perfect order”; and
4. “Another set of clerks who [plan] the work well in advance, [move] the [workers] with
the least loss of time from one place to another, and properly [record] each
[worker’s] earnings, etc.”

By distributing work in this fashion, each worker:

1. “Performs the function for which [they are] best suited…

2. Preserves [their] own individuality and is supreme in [their] particular function, and…
3. At the same time loses none of [their] originality and proper personal initiative, and
yet
4. Is controlled by and must work harmoniously with many other [workers].”

This is what Taylor “referred to as cooperation between the management and the
[workers].”

Principle Four: Divide the Work and Responsibility

According to Taylor, the “initiative and incentive” approach required workers to “bear
almost the entire responsibility for the general plan,” “each detail of…work,” and “the actual
physical labor.”

In contrast, he argued that Scientific Management was more effective because “even if the
[worker] was well suited to the development and use of scientific data, it would be
physically impossible for [them] to work at [their] machine and at a desk at the same time.”

Moreover, “in most cases one type of man is needed to plan ahead and an entirely
different type to execute the work.”

Thus, Taylor argued that the best approach would be “an almost equal division of the
responsibility and the work between the management the [worker].”
When discussing his bricklaying study, Taylor said that management’s responsibility was to
ensure cooperation between all of the aforementioned parties. This included ensuring that
workers were provided the correct tools, operating under the right conditions and
according to the correct procedures, and informed of their pace and progress.

Simultaneously, Taylor said that management should also be “side by side with the
[workers], helping, encouraging, and smoothing a way for them.” Therefore, management
was responsible for enforcement of methods, adoption, and cooperation, while workers
received extra pay for performance.

Finally, when rewarding workers, Taylor stated that it “must come soon after the work has
been done.” This was because he found that workers would lose motivation if rewards
came too far in the future. From his bicycle ball study, he determined that communication
of performance and rewards should come daily and encouragement through personal
attention “as often as once an hour.”

Thus, in addition to being the father of Scientific Management, Taylor was also ahead of his
contemporaries in his understanding of reward-related motivation.

As you’ve discovered, Taylor’s contributions were largely misunderstood and ahead of their
time.

While he may not have been tactful in his writings, as was discussed, his intentions were
good. Not only did he seek “maximum prosperity” for the organization and the worker, but
also the consumer and entire “civilized world.” He desired: “Science, not rule of thumb.
Harmony, not discord. Cooperation, not individualism. Maximum output, in place of
restricted output. [And] the development of each [person] to [their] greatest efficiency and
prosperity.”

And through his methods, he helped us move towards these goals, achieving
improvements in working conditions, productivity, and profitability beyond expectations.

In fact, in some cases, he even achieved productivity improvements of up to nine times the
norm!

Thus, it is clear that knowledge of Frederick Taylor and his Theory of Scientific
Management is essential to all managers and students of management.
Who is Henri Fayol?
Jules Henri Fayol (1841-1925) was born in Galata, Ottoman Empire, and raised in France.
After graduating from mining academy L’École Nationale Supérieure des Mines, he worked
as a mining engineer for Boigues Rambourg, eventually becoming Managing Director in
1888 and saving the company from bankruptcy. By 1900, under Fayol’s management, the
firm became “one of the largest producers of iron and steel in France and regarded as a
vital national industry.”3

Over the span of his career, Fayol became interested in the problems of management—at the organizational level in
particular—and sought to establish general management principles that could be applied to all organizations.

He began garnering attention after publishing his theories in a 1908 paper, and his work
culminated in the world-famous book, “Administration Industrielle et Générale” (“General
and Industrial Management”).

As a result of this piece of work, Fayol became known for his Administrative Theory, also
known as “Fayolism,” and as the father of Modern Management.

Fayol completed his most famous works during the Classical Period of management theory,
alongside contemporaries like Max Weber (known for his principles of
bureaucracy) and Frederick Taylor (known for his principles of Scientific Management).

What are Fayol’s management theories?

The Management Theory of Henri Fayol includes three main theories:

1. The Six Industrial Activities

2. The Five Functions of Management
3. The 14 Principles of Management
 I’ll provide the details about each of them in the sections below.

The Six Industrial Activities

To begin his book, Henri Fayol states that there are six main industrial activities. The types
of activities are:

1. Technical, including production, manufacturing, and adaptation;

o A high level of technical ability is important in order to produce excellent
products.
2. Commercial, including markets, contracts, buying, selling, and exchange;
o Being skilled in commercial aspects is important because it has a strong
impact on revenue and cost savings.
3. Financial, involving the search for and optimum use of capital;
o Since “many potentially prosperous enterprises die suffering from lack of
money…nor is any reform or improvement possible without finances or credit,”
optimal use of finances is critical to a business.
4. Security, involving the protection of people and property;
5. Accounting, stocktaking, the balance sheet, costs, and statistics;
o “An efficient accounting system, clear and simple, giving an accurate idea of
the firm’s condition, is a powerful managerial instrument;” and
6. Managerial, including planning, organizing, command, coordination, and control;
o “Management…is neither an exclusive privilege nor a particular responsibility
of the head or senior members of the business; it is an activity spread, like all
other activities, between head and members of the body corporate.”

While listing and distinguishing each of these categories wasn’t entirely a development in
Management Theory, the separation of, focus on, and development of management as a
distinct and important discipline absolutely was. Thus, this section of Fayol’s book was
more concerned with demonstrating that management is unique and alluding to his
groundbreaking work on The Five Functions of Management.

The Five Functions of Management

Within Managerial Activities, Henri Fayol specifies five primary functions (or elements).
These functions are:

1. Planning;
2. Organizing;
3. Command;
4. Coordination; and
5. Control.

Fayol says that planning, also labelled as a “plan of action,” “is one of the most difficult
and…important matters of every business and brings into play all departments and all
functions, especially [management].” He states that planning is comprised of four
components:
 1. The desired result (i.e. goal);
2. The action;
3. The stages; and
4. The methods.

In order to create a plan, a manager must consider the firm’s tangible and intangible
resources, work already in progress, trends, and future events. Features of a good plan are
said to include: unity, continuity, flexibility, and specificity.

Organizing involves providing everything that is necessary to a plan of action—including

physical and human resources—and its activities.

Command is described as getting “the optimum return from all employees of [a

manager’s] unit in the interest of the whole concern.” This includes:

1. Having competent personnel;

2. Knowing personnel thoroughly;
3. Knowing the organization’s obligations to its personnel;
4. Working with other managers to ensure unity of direction and effort amongst
managers and personnel;
5. Setting a good example;
6. Performing regular audits of performance; and
7. Staying out of the minutiae.

Coordination requires ensuring that all personnel understand their responsibilities and

resources and activities across the organization work in harmony in order to achieve the
desired goal.

And finally, control consists of “verifying whether everything occurs in conformity with the

plan adopted, the instructions issued, and the principles established.”

Combined, Fayol’s Five Functions of Management marked a substantial development in the

field of Management Theory, “is credited with the original planning-organizing-leading-
controlling framework,” and remains a major management framework worldwide.

Henri Fayol's 14 Principles of Management

Henri Fayol believed that “the soundness and good working order of the body corporate
depend on a certain number of conditions termed...principles, laws, [or] rules.” In turn, he
produced 14 that are “flexible and capable of adaptation to every need,” but require
“intelligence, experience, decision, and proportion.” Given that “without principles one is in
darkness and chaos,” Fayol hoped that these principles could be relied upon and/or used
for future study.

Otherwise, it’s important to note that what Fayol offers are simply “some of the principles
of management which [he has] most frequently had to apply.” He states that “there is no
limit to the number of principles of management” and “every rule or managerial procedure
which strengthens the body corporate or facilitates its functioning has a place among the
principles.”

With the above in mind, the following describes each of the 14 components of Fayol’s
administrative principles approach.

1. Division of work;
o Specialization helps to “produce more and better work with the same effort”
by reducing “the number of objects to which attention and effort must be
directed.”
2. Authority;
o “Authority is not to be conceived of apart from responsibility, that is apart
from sanction—reward or penalty—which goes with the exercise of power”; in
other words, having and exercising authority comes with responsibility and
consequences.
o “Useful actions [of personnel] have to be encouraged and their opposite
discouraged.” Any sanction delivered “must take into account the action itself,
the attendant circumstances, and potential repercussions” and requires “high
moral character, impartiality, and firmness.”
3. Discipline;
o “Obedience, application, energy, behavior, and [the respecting of agreements]
…is absolutely essential for the smooth running of business.” That being said,
“the state of discipline of any group of people depends essentially on the
worthiness of its leaders”; Fayol states that any problem with discipline “mostly
results from the ineptitude of the leaders.”
o Agreements between management and personnel should “be clear and, as far
as possible, afford satisfaction to both sides.”
4. Unity of command;
o “For any action whatsoever, an employee should receive orders from one
superior only… Should it be violated, authority is undermined, discipline is in
jeopardy, order disturbed, and stability threatened.”
o This principle is emphasized as being especially important.
5. Unity of direction;
o A group of activities with the same objective should have one plan and one
person in charge. This is “essential to unity of action, coordination of strength,
and focusing of effort.”
6. Subordination of individual interests to the general interests;
o Everyone should work in the combined best interests of everyone involved
rather than in their own best interests.
o Managers can influence positive behavior through: “firmness and good
example,” “agreements as fair as is possible,” and “constant supervision.”
7. Remuneration;
 o Remuneration is dependent on a number of factors, but “it should be fair and,
as far as is possible, afford satisfaction both to the personnel and firm.”
8. Centralization;
o “The question of centralization or decentralization…is a matter of finding the
optimum degree for the particular [decision/task]” and the capacity and/or
preferences of the manager.
9. Scalar chain (line of authority);
o Authority should move from the top down in order to maintain unity of
command, but lateral communication is possible if superiors are aware of and
support it.
o The line of authority should be as short as possible.
o “It is an error to depart needlessly from the line of authority, but it is an even
greater one to keep to it when detriment to the business ensues.”
10.Order;
o Materials must have “a place appointed for each thing and each thing must be
in its appointed place.” Places should also be “suitably arranged” and “well
chosen.” This is to avoid “useless handling, lost time, [and] risk of mistakes.”
o In addition, there should be “an appointed place for every employee” and
each employee is suitable for their place.
o Charts or plans are recommended in order to organize materials and people.
11.Equity;
o Managers should “strive to instill [a] sense of equity” throughout their chain of
command and use “equity and equality of treatment” when dealing with
employees.
12.Stability of tenure of personnel;
o “Instability of tenure is at one and the same time cause and effect of bad
running.” In the case of personnel, they should be in a position long enough
to have time to “render worthwhile service”; if not, “the work will never be
properly done.” But, like all other principles, it’s “a question of proportion”;
tenure can also be too long.
13.Initiative;
o “It is essential to encourage and develop [initiative],” but to also ensure
“respect for authority and for discipline.” “Other things being equal…a
manager able to permit the exercise of initiative on the part of subordinates is
infinitely superior to one who cannot do so;” and
14.Esprit de corps.
o “Harmony, union among the personnel of a concern, is great strength in that
concern” and “effort…should be made to establish it.”

How do Fayol’s management theories apply to leaders today?

As mentioned earlier, since Henri Fayol’s Five Functions of Management remains a major
management framework, it can still be used as it was originally written. That being said, the
theory is descriptive, not prescriptive; it serves more as a scaffolding, general process, or
reminder of duties rather than any sort of technique.

In any case, it includes a few gems that can be used as checklists, like the four components
of planning (goal, action, stages, and methods). The same can be said about Fayol’s 14
Principles of Management.

Fayol's work is frequently compared with human relations theories popularized by other major thinkers in
organizational psychology in the early 20th century, including Elton Mayo and the Hawthorne Plant experiments.

Otherwise, on the subject of applicability, many people have argued that Fayol’s approach
is cold and mechanistic. However, I’d argue the opposite, and especially so for his time.
Throughout his work, one should note that he: considers multiple perspectives;
recommends the empowerment of and “kindliness” and fairness towards personnel; and
often prescribes flexibility in approaches.

Also, remember that he was talking about the broader subject of Management as opposed
to the specific subject of Leadership; that is, I’d argue that Management tends to be less
sympathetic, comparatively cold, and calculated, while Leadership is more sympathetic,
warm, and considerate. Regardless, if you consider his work in its entirety and remember
that it was translated from another language many years ago, I believe you’ll have a more
favorable perspective.

So, altogether, Fayol’s management theories definitely still apply as-is and are excellent
reminders of the duties that come with the Management function. If you haven’t read
about them before, it might help to go through them again and consider things from your
current position or the perspective of the subject of a case study. That way, you can get a
better understanding of management as a function and the leader’s role within it.

Ongoing impact of Henri Fayol’s management theories

As a result of his contributions to Administrative Theory, Henri Fayol is still regarded as one
of the most important management thinkers of all time.
Clearly, this is well deserved as his theories have stood the test of time and influenced well-
regarded developments since.

Therefore, Fayolism is a great subject of study and worth keeping around as management
reference material.
Who is Max Weber?
Maximilian Carl Emil Weber (1864-1920) was born in Erfurt, Prussia. After completing high
school, Weber began studying law at the University of Heidelberg at age 18. Weber then
completed one year of military service before continuing his studies and practicing as a
lawyer. He eventually earned his doctoral degree in law at the University of Berlin in 1889
and began working as an economics professor.2

Weber spent time teaching at the University of Berlin, University of Freiburg, and University of Heidelberg before
retiring in 1903. Thereafter, Weber became an independent scholar, completing numerous written works and filling
various short-term teaching positions.

Weber’s most prominent works came after his retirement, including “The Protestant Ethic
and the Spirit of Capitalism” in 1904 and “Economy and Society” posthumously in 1922.
The management-related theories that he is well-known for came in the latter of the two
publications and included his Theory of Bureaucracy and the Ideal Types of Political
Leadership. For these and his other contributions, Weber is regarded as one of the
founding fathers of the field of Sociology.

It’s worth mentioning that while other prominent figures in the development
of management theory such as Henri Fayol and Elton Mayo are primarily known within
business and commerce, Weber’s contributions were unusually wide-ranging. He’s
commonly cited along with Karl Marx as a key figure in the founding of sociology as a
discipline.3

What are Weber’s management theories?

While Weber may be best known for his numerous contributions to the field of Sociology,
he is also known for two key contributions to Management theory:
 1. The Theory of Bureaucracy
2. The Ideal Types of Political Leadership.

We’ll take an in-depth look at each of these contributions to Management in the following
sections.

The Theory of Bureaucracy

One of Weber’s greatest contributions to management theory was his Theory of
Bureaucracy. This theory states that there are six principles of bureaucracy, including:

1. Specialization
2. Formalized rules
3. Hierarchical structure
4. Well-trained employees
5. Managerial dedication
6. Impartiality of management

The six principles of bureaucracy

First, Weber stated that a bureaucracy has specialization.4 This includes:

 Distributing and assigning specific duties to specific roles;

 Giving management the authority to give commands and providing guidelines on
the methods they should use; and
 Assigning people to these roles based on merit.

When Weber spoke of formalized rules, he was speaking of what could now be described
as policies and procedures. While his focus was primarily on the broad, exhaustive, and
relatively stable rules that govern managers, the principle can also be applied to lower-
level positions. The rules that are standardized and documented should detail the
organizational structure, who is responsible for certain tasks, and how tasks are supposed
to be performed. In large part, this is done so rules can be learned. 5

Weber also stated that an organization should have a hierarchical structure, with one
clear leader at the top. This structure should detail all of the managerial levels and which
subordinate positions report to a given superior. Creating such a structure is beneficial top-
down because it details who is responsible for supervising whom and bottom-up because
it delineates who one should speak with if they’re looking to appeal any given decision.

Weber's principles of bureaucracy may be scorned by tech companies and startups, but most mid-large corporations
ultimately model them as a response to increased complexity with large distributed workforces.

Moreover, an organization should have well-trained employees. Weber states that

managers should have thorough expert training, especially in the case of specialized
positions, and that subordinate employees should also receive training.

Furthermore, Weber stated that a bureaucracy requires managerial dedication. Weber

wrote that managers should be dedicating their “full working capacity” regardless of how
long they will hold their position and always put official business ahead of other
distractions.

Finally, Weber stated that there should be impartiality of management. This includes
managers following the established rules and keeping business property, interests, and
activities separate from personal property, interests, and activities. In particular, “individual
privileges and bestowals of favor” should be avoided.

Altogether, these six principles of bureaucracy make up the “ideal bureaucracy.” Note that
the word “ideal” was not used to mean “optimal” or “best”; rather, “ideal” was meant to
mean “most common” or “archetypal.” Thus, these are principles by which most
bureaucracies operate.

Nonetheless, Weber thought that the bureaucratic organization had a “technical superiority
over any other form of organization” during his time due to its “precision, speed,
unambiguity, knowledge of the files, continuity, discretion, unity, strict subordination,
reduction of friction, and of material and personal costs.” 6
The Ideal Types of Political Leadership
Another notable contribution from Weber was his classification system of authority, which
included:

1. Traditional authority
2. Charismatic authority
3. Rational-legal authority

1. Traditional Authority
Weber states that traditional authority comes from historical customs.7 Traditional
authority requires a belief in the importance of traditions as well as respect for those who
exercise authority within those traditions. If belief in a given tradition is high, people who
are important to the tradition would have a high degree of status and others would follow
their leadership out of respect for and loyalty to them and the tradition. Thus, submission
to traditional authority happens if commands:8

1. Are valid within the tradition; or, if not specific to the tradition,
2. Are otherwise ethical (i.e. fair, useful, or of benefit to the majority).

Someone with traditional authority can maintain respect, compliance, and their position as
long as people believe in the tradition and their commands fall within the aforementioned
parameters.

Typically, leaders with traditional authority are determined based on:

1. Age (gerontocracy; i.e. led by elders); and/or

2. Defined inheritance (patriarchalism; e.g. a certain prince to replace a king); or
3. Power (patrimonialism).

When compared to an “ideal bureaucracy,” an organization dominated by traditional

authority would have the following characteristics:

1. Positions are filled based on favoritism rather than technical expertise;

2. Rules are “handed down from the past” or otherwise dictated by the ruler;
3. An irrational hierarchy, with some specialization;
 4. Recruitment, selection, and promotion based on favoritism;
5. A lack of technical training; and
6. Fixed salaries.

2. Charismatic Authority
Weber states that charismatic authority comes from personal qualities. Charismatic
authority requires a belief that a leader has exceptional capabilities and/or characteristics,
whether or not they are objectively verifiable (e.g. a religious prophet versus a
groundbreaking scientist). In the case of a leader with verifiably exceptional capabilities
and/or characteristics, submission to charismatic authority happens out of a believed duty
to:

Companies like Apple, Facebook, and WeWork are known for charismatic leaders — and the associated lack of rigid
protocols, for better or worse.

1. Recognize the leader’s personal qualities; and

2. Act in accordance with their discoveries or expertise.

In order for someone with charismatic authority to maintain respect, compliance, and their
position, they must continue to produce, most importantly to the benefit of their followers
or “community.”

When compared to an “ideal bureaucracy,” an organization dominated by charismatic

authority would have the following characteristics:

1. Positions are filled based on personal qualities, which may or may not include
technical expertise (depending on whether or not the leader’s capabilities and/or
characteristics are objectively verifiable);
2. Rules are “discovered” and made concrete by the leader as they present themselves,
but routine is otherwise avoided;
3. No hierarchy, but some specialization;
 4. Recruitment and selection based on the leader’s perception of a person’s capabilities
and/or characteristics;
5. A lack of technical training; and
6. Minimal compensation, coming from outside donation to “the cause” (given that
participation is seen as a “calling”).

It is important to note that, according to Weber, charismatic authority is revolutionary and

often displaces traditional authority. This happens through the following three-step
process:

1. Produce a subjective/internal reorientation

2. Change attitudes
3. Produce a material reorientation

However, given the authority’s fluidity, charismatic authority is also likely to be displaced,
eventually developing into a new traditional and/or rational-legal authority.

3. Rational-Legal Authority
Weber states that rational-legal authority comes from established rules. Rational-legal
authority requires a belief in enacted rules and that the leader who is issuing commands is
doing so within their assigned scope of formal responsibility. More specifically, submission
to rational-legal authority happens when:

1. Established rules are consistent and capable of being applied to relevant cases;
2. The people involved broadly agree to obey the established rules;
3. The people involved obey the established rules when and where they apply;
4. The people involved are specifically obeying the rules rather than the people who
enforce the rules; and
5. Those who are in command are subject to the same rules.

Rational-legal authority applies to continuous rule-bound business conduct within a

particular sphere or jurisdiction. Each sphere or jurisdiction requires:

1. Distributed functions;
2. A person granted authority over each function;
3. Specific conditions to prompt enforcement within the function; and
4. Clearly defined methods of enforcement.

Rational-legal authority also requires:

1. Hierarchical organization, with the right to appeal to a higher authority;

2. Specialized training in order to be in a position of authority;
3. People with authority not to be owners of the organization and that personal and
business property are kept separate;
4. Positions to be filled rather than permanently owned; and
5. Rules to be documented completely.
When compared to an “ideal bureaucracy,” an organization dominated by rational-legal
authority would have the following characteristics:

1. Positions are appointed and based on free contractual relationships;

2. Rules are formal, detailed, consistent, documented, and broadly agreed upon;
3. A clearly defined hierarchy;
4. Recruitment and selection based on technical qualifications and promotion based on
seniority, achievement, or both;
5. A high degree of technical training; and
6. Fixed salaries.

Analysis of Weber’s Theories and Application to Today

Nowadays, words like “bureaucracy” and “authority” have a negative connotation.

When considering these words, and Weber’s work more broadly, one has to remember the
time in which they came. In fact, as management concepts, these had a positive
perspective and were relatively new, codifying how to optimally structure organizations
(bureaucracy) and the main types of authority (political leadership). 9

In reality, while we might dislike the word “bureaucracy” at this point in time, most
businesses are still rightfully modeled in this fashion due to the concept’s structure, broad
applicability, and effectiveness.

Max Weber impact on tech sector

When you dive deep into the details of the Ideal Types of Political Leadership, you find
another example where Weber was ahead of his time.

Potentially inadvertently, he describes the “organic structure” detailed in Contingency

Theory when speaking of charismatic authority; that is, organizations under charismatic
authority have inconsistent and unpredictable tasks and are thus less defined and more
flexible in order to accommodate the conditions. 10

This is exactly how businesses with ever-changing conditions operate today, including
countless tech companies. And then, surely enough, they’re led by eccentric, “charismatic”
figureheads, like Elon Musk, Steve Jobs, Mark Zuckerberg, and more.

So, the principles of Weber’s Theory of Bureaucracy still hold true to the organizations of
today.

Likewise, the Ideal Types of Political Leadership relatively accurately describe the main
structures of authority and the characteristics of organizations that follow.

Thus, Max Weber’s contributions are certainly noteworthy and relevant to modern students
of management theory.