C.D.

JAIN COLLEGE OF
COMMERCE, SHRIRAMPUR
F.Y.B.B.A. Sem. I
Sub:- Principal of Management
Chapter 2- Evolution of Management Thoughts

By:- Jejurkar M. S.
M.Com,SET, NET
 Contained
2.1 Concept of Managerial Thoughts
2.2 Contribution of Talylor, Mayo.Fayol and Druker
2.3 Indian Management Thoughts and Different Styles
(For Examples
i. J.R.D. TATA
II. Dhirubhai Ambani
Iii. N.R. Narayana Murthy
Iv. Verghese Kurien
2.1 Concept of Managerial Thoughts
 The origin of Evolution management can be traced back to the days when
man started living in groups. History reveals that strong men organized the
masses into groups according to their intelligence, physical and mental
capabilities.
 Evidence of the use of the well recognized principles of management is to
be found in the organization of public life in ancient Greece, the
organization of the Roman Catholic Church and the organization of military
forces.
 Thus management in some form or the other has been practiced in the
various parts of the world since the dawn of civilization. With the on set of
Industrial Revolution, however, the position underwent a radical change.
 The structure of industry became extremely complex. At this stage, the
development of a formal theory of management became absolutely
necessary. It was against this background that the pioneers of modern
management thought laid the foundations of modern management theory
and practice.
2.1 Concept of Managerial Thoughts

 The schools of management thought are theoretical frameworks for the

study of management. Each of the schools of management thought are
based on different assumptions about human beings and the organizations
for which they work .
 Since the formal study of management began late in the 19th century, the
study of management has progressed through several stages as scholars
and practitioners working in different eras focused on what they believed
to be important aspects of good management practice.
 Over time, management thinkers have sought ways to organize and
classify the voluminous information about management that has been
collected and disseminated. These attempts at classification have resulted
in the identification of management schools.
Classification of School of
Management Thoughts
Other
Classical Neoclassical Morden Schools
School School School

Decision Theory
System School of School
Scientific Management
Management
Management
Behav ioural process school
School or Human Social System
Relation School
Human Resource
School
Administrativ e
Management Contingency or
situational School Empirical School
of Management
 2.2 A) Contribution of F.W. Taylor
 Frederick W. Taylor (1856-1915), developer of scientific management.
Scientific management (is a theory of management that analyses and
synthesizes workflows, with the objective of improving labour productivity.
 The core ideas of the theory were developed by Frederick Winslow Taylor
in the 1880s and 1890s, and were first published in his monographs, Shop
Management (1905) and The Principles of Scientific Management (1911).
 Frederick Taylor's scientific management theory can be seen in nearly all
modern manufacturing firms and many other types of businesses.
 His imprint can be found in production planning, production control,
process design, quality control, cost accounting, and even ergonomics.
 F.W. Taylor define ”Scientific Management is concern with knowing
exactly what you want men to do and then see they do it in the best and
cheapest way”.
 I) Elements of Scientific Management
1. Separation of Planning and Doing :- It is a forward-looking task involving steps to
remove the causes that may stand in the way of proper implementation and
smooth functioning of the scheme and the organisation. Preparation of detailed
instructions for the workers, according to Taylor, is a must; workers should not be
allowed to follow their own way of doing work that may lead to inefficient
production.
2. Job Analysis: Taylor said that the job to be performed should be scientifically studied
to find the best way of doing things. This includes time and motion study.
i. Time study:- Time study is primarily the art of observing and recording the best way
of doing a piece of work. According to Taylor, it is not possible to assign a worker
just the volume of work he should do-the optimum that can be expected of him.
ii. Motion Study:It is study of the movement of an operator for eliminating useless
motions. This study carried on scientifically ensures most effective and most
economical method of doing a job. The purpose of such study is to ascertain the
best method of performance with the last wastage of time.
iii. Method Study: It is the determination of the standard task and; as such, the first step
in the preparation of “Process Chart.” The ways and means of simplifying design of
the product, the improvement in material handling, transportation, storage etc. are
all included in method study.
 Elements of Scientific Management
3. Fatigue Study: A worker, it must be admitted, gets tired at a certain point of time and
if he is compelled to continue with his work, he suffers, the work itself suffers. So,
scientifically it has to be determined when on a standard piece of work an average
worker gets tired.
4. Differential Wage System:- Many expert including Taylor advocated a differentially
wage system to improve worker productivity. They suggested that the wage should
be associated with productivity. Differential wage system involves the payment of
higher wage to more efficient workers to encourage them to surpass pervious
performance. Those who are capable can earn wages without any limit.
5. Standardization:Work-standardization is a primary task in Scientific Management.
Scientific study is carried on and then right from recruitment of staff to their
placement and performance of work are all standardised. This study is done with a
view to securing better quality, more quantity and output, economy in the use of
materials and overheads.
 Elements of Scientific Management
6. Scientific Selection and Training:It cannot be over-emphasized that proper- selection
of personnel and their proper training are essential to ensure a better performance
of the firm. Scientifically selected persons, properly trained and placed in the right
position can ensure to a great extent a better accomplishment of the objectives of
the firm.
7. Mental Revolution:A perfect co-operation between management and the
managed is a pre-requisite for a successful firm. The firm cannot expect to achieve
the desired results unless the management and the workers go through mental
revolution to accept the principles of Scientific Management. Taylor suggested
mental revolution in the outlook of employers and employees.
8. Financial Incentives:- Taylor suggested that workers should be given financial
incentives to encourage them to put maximum efforts and to achieve better
performance .
9. Economy:- Taylor emphasised on achieving economy in operations. He laid stress on
higher production efficiency by reducing the cots and eliminating wastages. Higher
efficiency in production results into reduced cost of production through increased
efficiency of material handling and processing.
II) Principles of Scientific Management
1. Replacing rule of thumb with science :- This principle requires development
and application of scientific methods. Taylor advocated that the traditional
rule of thumb’ methods should be replaced with the scientific methods.
2. Scientific Development of Workers: The procedure for selection of workers
should be designed scientifically. The errors committed at the time of
selection may prove o be very costly later on. If we do not have right
workers on the right job, the efficiency of the organisation will be reduced.
3. Harmony, not Discord (Conflict):There should be harmony (not conflict)
between the management and the workers. This requires change of
mental attitudes of the workers and the management towards each other.
Taylor called it mental revolution. When this mental revolution takes place,
workers and management turn their attention towards increasing profits.
They do not quarrel about the distribution of profits.
 II) Principles of Scientific Management

4. Cooperation, not Individualism:Scientific management is based on cooperation

between management and workers, as also between workers themselves.
Management can earn higher profits if the workers perform their jobs efficiently
and thus ensure better quality, lower costs and larger sales. Workers on their part
can earn higher wages if the management provides them with standard
materials, standard tools, standardised working conditions, training in standard
methods, etc.
5. Maximum, not Restricted Output:Both the management and workers should try to
achieve maximum output in place of restricted output. This will be beneficial to
both the parties. Maximum output will result in higher wages for the workers and
greater profit for the management. Increased productivity is also in the interest of
the consumers and the society at large.
6. Principles of work :-
i. A large Daily Task
ii. Standard Condition
iii. High pay for success
iv. in case of failure
 2.2 B) Contribution by Elton Mayo
The human relations theory

 In the 1920s, Elton Mayo, an Australian-born psychologist and

organizational theorist, began his research on the behavior of people in
groups and how it affects individuals in the workplace, known as the
Hawthorne studies.
 Mayo, in contrast, popularized the idea of the "social person," meaning
organizations should treat people as individuals – not machines – with
individual needs.
 The human relations management theory is a researched belief that
people desire to be part of a supportive team that facilitates development
and growth. Therefore, if employees receive special attention and are
encouraged to participate, they perceive their work as having significance
and are motivated to be more productive, resulting in high-quality work.
 Mayo management theory states that employees are motivated far more
by relational factors such as attention and camaraderie than by monetary
rewards or environmental factors such as lighting, humidity, etc.
 2.2 B) Contribution by Elton Mayo
The human relations theory
 This approach attempted a theory of management in term of social relationship
dev eloping a point of view on what is adequate personnel management ,it
observes:-
1. In organization , an individual by means of skill commits itself to the continuous
process of studying human situations, both individual and group, within
organization
2. It tries to secure the collaboration of its employees by running its human affairs
terms of what its learns and discovers about its own organisation.
3. It learns that what is important to a particular employees exists in its own
backyard.
4. Special attention causes people to increase their efforts.
5. Happy employees are productive workers
6. Group Stansted's are highly effective in establishing individual work output.
7. Behaviour and sentiments are closely related and the group influences
individuals behaviour.