EVOLUTION OF MANAGEMENT

THOUGHT
UNIT – 02
Early 3000-4000BC – Egyptian civilization

Chanakya’s Arthashastra – 3rd century BC

Sun Tzu’s The art of war -- 6th Century BC

Machiavelli The Prince --- 1513

Effect of Industrial Revolution on Management:

18th century – Conceptualization Perspective

19th century – offshoot of economics

20th century – systematic managerial text

 HISTORICAL BACKGROUND

• ANCIENT MANAGEMENT
➢ EGYPT (PYRAMIDS) AND CHINA (GREAT WALL)
➢ VENETIANS (FLOATING WARSHIP ASSEMBLY LINES)
• ADAM SMITH
➢ PUBLISHED ‘THE WEALTH OF NATIONS” IN 1776
ADVOCATED THE DIVISION OF LABOR (JOB SPECIALIZATION) TO INCREASE THE
PRODUCTIVITY OF WORKERS
▪ INDUSTRIAL REVOLUTION
➢ SUBSTITUTED MACHINE POWER FOR HUMAN LABOUR
➢ CREATED LARGE ORGANISATIONS IN NEED OF MANAGEMENT
APPROACHES TO MANAGEMENT
 MAJOR APPROACHES TO
MANAGEMENT
• SCIENTIFIC MANAGEMENT
• GENERAL ADMINISTRATIVE THEORY
• QUANTITATIVE MANAGEMENT
• ORGANISATIONAL BEHAVIOUR
• SYSTEMS APPROACH
• CONTINGENCY APPROACH
 EVOLUTION OF MANAGEMENT THOUGHT

Early Classical Scientific Management

Approaches Administrative Management
Bureaucracy

Neo-classical Human Relations Movement

Approaches Behavioral Approach

Modern Quantitative Approach

Approaches Systems Approach
Contingency Approach
 SCIENTIFIC MANAGEMENT

FREDERICK WINSLOW TAYLOR (1856-1915)

FATHER OF SCIENTIFIC MANAGEMENT
PUBLISHED PRINCIPLES OF SCIENTIFIC MANAGEMENT (1971)

THE SYSTEMATIC STUDY OF THE RELATIONSHIPS

BETWEEN PEOPLE AND TASKS FOR THE
PURPOSE OF REDESIGNING THE WORK
PROCESS TO INCREASE EFFICIENCY.
 TAYLOR’S FOUR PRINCIPLES OF
MANAGEMENT
1. REPLACE THE OLD RULE-OF-THUMB WITH SCIENCE & STANDARDIZATION
2. THE RIGHT PERSON FOR THE JOB.
3. PROPER DIVISION OF WORK BETWEEN WORKERS AND MANAGERS.
4. COLLABORATION BETWEEN WORKERS & MANAGERS.
LIMITATIONS

• WORKERS NOT TREATED HUMANELY

• NARROW FOCUS
• MONOTONOUS
• RESENTMENT AMONG THE WORKERS
 SCIENTIFIC MANAGEMENT
▪ FRANK AND LILLIAN GILBERTH
✓ FOCUSED ON INCREASING WORKER PRODUCTIVITY THROUGH THE
REDUCTION OF WASTED MOTION DEVELOPED THE MICROCHRONOMETER
TO TIME WORKER MOTIONS AND OPTIMIZE WORK PERFORMANCE
• HOW DO TODAY’S MANAGERS USE SCIENTIFIC MANAGEMENT:
➢USE TIME AND MOTION STUDIES TO INCREASE PRODUCTIVITY
➢HIRE THE BEST QUALIFIED EMPLOYEES
➢DESIGN INCENTIVE SYSTEMS BASED ON OUTPUT
General Administrative Management
THE STUDY OF HOW TO CREATE AN ORGANIZATIONAL STRUCTURE THAT LEADS TO
HIGH EFFICIENCY AND EFFECTIVENESS

HENRY FAYOL ( 1841-1925)

• FATHER OF ADMINISTRATIVE MANAGEMENT
• 1916 – GENERAL AND INDUSTRIAL ADMINISTRATION
• DEVELOPED FOURTEEN PRINCIPLES OF MANAGEMENT THAT APPLIED TO
ALL ORGANIZATIONAL SITUATIONS
 Exhibit 2–3 Fayol’s 14 Principles of Management

1. Division of Work. Specialization increases output by

making employees more efficient.
2. Authority. Managers must be able to give orders and
authority gives them this right.
3. Discipline. Employees must obey and respect the rules that
govern the organization.
4. Unity of command. Every employee should receive orders
from only one superior.

2-16 Copyright © 2011 Pearson Education

 Exhibit 2–3 Fayol’s 14 Principles of Management

5. Unity of direction. The organization should have a single

plan of action to guide managers and workers.
6. Subordination of individual interests to the general
interest. The interests of any one employee or group of
employees should not take precedence over the interests of the
organization as a whole.
7. Remuneration. Workers must be paid a fair wage for their
services.

2-17 Copyright © 2011 Pearson Education

 Exhibit 2–3 Fayol’s 14 Principles of Management

8. Centralization. This term refers to the degree to which

subordinates are involved in decision making.
9. Scalar chain. The line of authority from top management to
the lowest ranks is the scalar chain.
10. Order. People and materials should be in the right place at the
right time.
11. Equity. Managers should be kind and fair to their
subordinates.

2-18 Copyright © 2011 Pearson Education

 FOURTEEN PRINCIPLES OF
MANAGEMENT
1. Division of Work 8. Centralization

2. Authority and Responsibility 9. Scalar Chain

3. Discipline 10.Order
4. Unity of Command 11.Equity
5. Unity of Direction 12.Stability to Tenure of
Personnel
6. Subordination of Individual 13.Initiative
Interest to General Interest
7. Remuneration 14.Esprit de Corps
DISCUSSION

WHICH OF THE FOLLOWING IS THE MOST IMPORTANT ASPECT OF

FAYOL’S PRINCIPLES OF MANAGEMENT?

A. DIVISION OF LABOR
B. UNITY OF COMMAND
C. REMUNERATION OF PERSONNEL
D. ESPRIT DE CORPS
THEORY OF BUREAUCRACY

MAX WEBER
➢MAX (FATHER OF BUREAUCRACY)
➢DEVELOPED A THEORY OF AUTHORITY BASED ON AN IDEAL TYPE OF
(BUREAUCRACY)
➢EMPHASIZED RATIONALITY, PREDICTABILITY, IMPERSONALITY,
TECHNICAL COMPETENCE, AND AUTHORITARIANISM
 WEBER’S FORMS OF AUTHORITY
• TRADITIONAL AUTHORITY
• SUBORDINATE OBEDIENCE BASED UPON CUSTOM OR TRADITION (E.G.,
KINGS, QUEENS, CHIEFS).

• CHARISMATIC AUTHORITY
• SUBORDINATES VOLUNTARILY COMPLY WITH A LEADER BECAUSE OF HIS
OR HER SPECIAL PERSONAL QUALITIES OR ABILITIES (E.G., MARTIN LUTHER
KING, GANDHI).

• RATIONAL-LEGAL AUTHORITY
• SUBORDINATE OBEDIENCE BASED UPON THE POSITION HELD BY SUPERIORS
WITHIN THE ORGANIZATION (E.G., POLICE OFFICERS, EXECUTIVES,
SUPERVISORS).
 UNDERSTANDING OF
ORGANISATIONAL BEHAVIOUR
ORGANISATIONAL BEHAVIOUR (OB)
• THE STUDY OF THE ACTIONS OF PEOPLE AT WORK; PEOPLE ARE THE
MOST IMPORTANT ASSET OF AN ORGANISATION
EARLY OB ADVOCATES
➢ ROBERT OWEN
➢ HUGO MUNSTERBERG
➢ MARY PARKER FOLLETT
➢ CHESTER BARNARD
 SYSTEMS APPROACH

CHESTER BARNARD, GEORGE HOMANS, PHILIP SELZNICK AND HERBERT

SIMON
• A SET OF INTERRELATED AND INTERDEPENDENT PARTS ARRANGED IN A
MANNER THAT PRODUCES A UNIFIED WHOLE.
KEY CONCEPTS:
1. A SYSTEM IS A SET OF INTERDEPENDENT PARTS
2. CENTRAL TO THE SYSTEMS APPROACH IS THE CONCEPT OF “HOLISM”
3. A SYSTEM CAN BE EITHER OPEN OR CLOSED
4. EVERY SYSTEM HAS A BOUNDARY