Third Edition

Chapter 5 . . . . . . . . . . . . . . . . . . . . . .
The Evolution of Management and
Organization Theory

Dr. Wasim Al-Habil.

Chapter Five
The Evolution of Management
and Organization Theory

Key Topics

The Origins of Public Administration

The Evolution of Management
Principles
What is Organization Theory?
The Origins of Scientific Management
The Period of Orthodoxy
Bureaucracy
Neoclassical Theory & Systems Theory
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Civilization and administration

.have always gone hand in hand

The Origins of Public

Administration

1.
2.

Management: A term that can refer to both:

The people responsible for running an
organization
The running process itself - the utilization of
numerous resources to accomplish an
organizational goal.
Hierarchy: Any ordering of persons, things,
or ideas by rank or level. Administrative
structures are typically hierarchical in that
each level has authority over levels below
and must take orders from level above.

The Origins of Public

Administration

1.
2.
3.
4.
5.
6.
7.
8.
9.

The Military Heritage of Public Administration: Government

administrators are still considered servants in this sense; they are public
servants because they, too, have accepted obligations, which means they
are not completely free.
Comparing Military and Civilian Principles:
Objective: Direct Every military operation toward a clearly
defined, decisive, and attainable objective.
Offensive: Seize, retain, and exploit the initiative.
Mass: Concentrate combat power at the decisive place and time.
Economy of force: Allocate minimum essential combat power to
secondary efforts.
Maneuver: Place the enemy in position of disadvantage through
the flexible application of combat power.
Unity of command Ensure unity of effort under one responsible
commander.
Security Never permit the enemy to acquire an advantage.
Surprise: Strike the enemy at a time/place for which he is
unprepared.
Simplicity: Prepare clear, uncomplicated plans, concise orders to
ensure thorough understanding

The Origins of Public

Administration

Comparing Military and Civilian Principles:

1.

Policy should defined.

Work should be subdivided.
Tasks and responsibilities should be specifically assigned
and understood.
Appropriate methods and procedures should be developed
and utilized by those responsible for policy achievement.
Appropriate resources (men, money, materials).
Authority commensurate with responsibility should be
delegated and located.
Adequate structural relationships.
Effective and qualified leadership.
Unity of command.
Continuous accountability for utilization of resources.
Effective coordination.
Continuous reconsideration of all matters

2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.

What is Organization Theory?

An organization is a group of people who

jointly work to achieve at least one
common goal.
A theory is a proposition or set of
propositions that seeks to explain or predict
something.
The organization theory shows how groups
and individuals behave in differing
organization arrangements.
Organization theory was always there in the
authoritarian model offered by the military.
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Classical Organization Theory

The first school of organization theory rooted in the
industrial revolution of the 1700s.

Characteristics of Classical Organization Theory:

1.

Organizations exist to accomplish productionrelated and economic goals.

There is one best way to organize for production
Production is maximized through specialization
and division of labor.
People and organizations act in accordance with
rational economic principles.

2.
3.
4.

The Origins of Scientific

Management

1.

2.
3.
4.

Frederick Taylor, the father of scientific management, is the pioneer

who developed time and motion studies and provided the impetus
around which classical organization theory would evolve.
Through scientific management, Taylor believed that there is one
best way to accomplish any given task (Shafritz and Hyde, 1997,
p.2). He argues that the one best way provides the fastest, most
efficient, and least fatiguing production method (Ibid.).
In 1912, the U. S. House of Representatives investigated Taylors
systematic use of management techniques. Some of the management
techniques or as Taylor called them duties, included:
Replacing traditional rule of thumb methods of work accomplishment with
systematic, more scientific methods of measuring and managing individual
work elements;
Studying scientifically the selection and sequential development of workers to
ensure optimal placement of workers into work roles;
Obtaining the cooperation of workers to ensure full application of scientific
principles; and
Establishing logical divisions within work roles and responsibilities between
workers and management. (From the book of the Principles of Scientific
Management, Ibid., 3)

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Fayols six principles

Fayols major work, General and Industrial Management , which published in

France in 1916 and translated to English in 1925, also came with general
principles that can improve the performance of management in every type of
organization.

Fayols six principles are:

Technical (production of goods)
Commercial (buying, selling, and exchange activities)
Financial (raising and using capital)
Security (protection of property and people)
Accounting
Managerial (coordination, control, organization, planning, and command of
people)

Shafritz, Ott, and Jang (2005) states that Fayol believed that his concept of
management was universally applicable to every type of organization (p.31).

This generic model of Fayols general principles had an impact on public

administration because it was theorized to work in both public and private
organizations.

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The Period Of Orthodoxy

It covers the development of the public

administration between the WWI and WWII.
The tenets of orthodoxy ideology held that the work
of government could be neatly divided into decisionmaking and execution (politics-administration
dichotomy of Woodrow Wilson).
This dichotomy, which played an important role in
the historical development of PA, would hardly have
been possible of scientific management had not
evolved when it did.
According to Lynn (1996), orthodoxy was finished
off in public administration after World War II in a
series of articles and books (p.31) including the
works of Simon, Dahl, Appleby, Waldo, Long, and
Marx..

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Orthodox and Paul

Appleby

Paul Appleby was the Dean of Maxwell School at Syracuse

University.
Appleby (1945) contends similarly that, Government is
different because it must take account of all the desires,
needs, actions, thoughts and sentiments of 140,000,000
people. (Shafritz et al., 2004: p.135).
Paul Appleby, by some accounts wrote the definitive endnotes on the
politics-administration dichotomy. Essentially, Appleby in Big Democracy
(1945) compared government to business and determined government
was different and that politics is what comprises that difference.
Appleby states that:
Other institutions admittedly are not free from politics, but government is
politics. Government administration differs from all other administrative
work to a degree not even faintly realized outside, by virtue of its public
nature, the way in which it is subject to public scrutiny and public outcry.
(Paul Appleby in Big Government reprinted in Classics of Public
Administration, 125)

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Luther Gulicks POSDCORB

Gulicks book The Papers on the Science of Administration (1937).

Gulick argues that for governmental organizations to achieve

technical efficiency there is need to arrange or structure units and
departments according to their level of homogeneity, as failure to
do so, as he argues has often been the case, can only lead to
unsatisfactory results.

Of significant importance is Gulicks prescription of the functions of

the chief executive, which he derived from Henry Fayols general
principles of management.

He coined the famous POSDCORB from planning, organizing,

staffing, directing, coordinating, reporting, and budgeting, and
these were to be equally applicable to all forms of organizations
irrespective of type, context and size, presumably exhibiting some
general science based qualities.

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Federalism & Finance

Fiscal federalism is the financial relations between and among the

units of government in a federal system.

The assets and financial resources are divided and shared between
and among the three levels of government. For example, income
tax goes for the federal government and house and property tax
goes for the state government.

The theory of fiscal federalism, or multiunit government finance, is

one part of the branch applied economic known as public finance.

Medicaid is a federally aided, state-operated, and stateadministered program that provides medical benefits for a certain
low-income people in needed of health and medical care.

Grant: It is an intergovernmental transfer of funds (or other assets).

Since long along time, state and local governments have become
increasingly dependent upon federal grants for an almost infinite
variety of programs.

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Bureaucracy

The word bureaucracy is derived from two words; bureau

and Kratos. While the word bureau refers to the office
the Greek suffix kratia or kratos means power or rule.

We use the word bureaucracy to refer to the power of the

office (Hummel, 1998, 307).

Bureaucracy is rule conducted from a desk or office, i.e.

by the preparation and dispatch of written documents and
electronic ones.

Bureaucracy is borrowed by the field of public

administration (PA) from the field of sociology.

It was borrowed by PA in much a similar way that practices

of business were borrowed from the field of business
administration and economics.

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Bureaucracy & Max Weber

Weber (1946) presents bureaucracy as both a scientific

and generic model that can work in both the public and
private sectors (Rainey, 1996).

Max Webers work about bureaucracy, translated into

English in 1946, was one of the major contributions that
has influenced the literature of public administration.

Webers bureaucracy consists of the traditional way of

thinking in public administration that relied on the same
ingredients to reform public administration based on the
science of administration (Thompson, 2005).

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Bureaucracy & Max Weber

Webers bureaucracy has the following characteristics:

1.

The bureaucrats must be free agents.

The bureaucrats are arranged in a clearly defined hierarchy
of offices.
The functions of each office are clearly specified in writing.
The bureaucrats accept and maintain their appointment
freely.
The appointments to office are based on the technical
qualifications.
The bureaucrats receive money salaries and pension rights.
The office must be the bureaucrats sole.
A career system is essential.
The bureaucrats do not have property rights.
The bureaucrats conduct must be subject to systematic
control.

2.
3.
4.
5.
6.
7.
8.
9.
10.

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Neoclassical Organization Theory

There is no precise definition for neoclassical in the content of

organization theory.

This school was important because it initiated the theoretical

movement away from he over-simplistic mechanistic views of
classical school.

The neoclassicalists raised issues and initiated theories that became

central to the foundations of the most schools or approaches to
organization theory that followed.

The majority of the writers and authors of the neoclassical school

came after the end of the WWII.
They sought to save classical theory by introducing modifications
based upon research findings in the behavioral sciences.

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Neoclassical Organization Theory & Herbert

Simon

Herbert Simon looked back at the principles and

argued that they lacked all scientific rigor and they
could be mere proverbs.

He deconstructed Gulicks POSDCORB and dethroned

them as confusing facts with values and lacking all
scientific rigors (Stillman, 2000).

In his book Administrative Behavior: A Study of

Decision Making Process in Administrative
Organization (1947), he draws on logical positivist
continental analytic philosophy (Stillmann, 2000,
pg. 22) to explain administrative behavior.

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Neoclassical Organization Theory & Herbert

Simon

Herbert Simon looked back at the principles and argued

that they lacked all scientific rigor and they could be mere
proverbs.

He deconstructed Gulicks POSDCORB and dethroned them

as confusing facts with values and lacking all scientific
rigors (Stillman, 2000). The POSDCORB functions of the

public administration orthodoxy were inconsistent,

conflicting, and inapplicable in public administration
(Shafritz et al., 2004).

In his book Administrative Behavior: A Study of Decision

Making Process in Administrative Organization (1947), he
draws on logical positivist continental analytic
philosophy (Stillmann, 2000, pg. 22) to explain
administrative behavior.

21

Neoclassical Organization Theory & Herbert

Simon

He argued that a true scientific method should be used in the study of

administration, but what was used by the orthodoxy lacked the empirical
basis to do so.

Simon (1946) believed that for almost every principle [of orthodoxy] one
can find an equally plausible and acceptable contradictory principle.

Simon proposed the fact-value dichotomy because it provides a stronger

basis for a science of administration. Through the behavioral approach,
Simon narrowed the scope of rationalism by separating facts from values
and introducing his concept of bounded rationality.

Bounded rationality refers to the bounds that people put on their decisions.
Because truly rational research on any problem can never be complete,
human make decisions on satisfactory as opposed to optimal information.

Simon rejected the politics-administration dichotomy because of its failure

to define a value-free domain required for the development of a science of
administration, since administrators are involved in policy functions and
thus values consideration (p.186).

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Modern Structural Organization Theory

The basic assumptions of the modern structural

organization theory:

1.

Organizational are rational institutions whose primary

purpose is to accomplish established objectives.

2.

There is a best structure for any organization or at

least a appropriate structure in light of its given
objectives, the environmental conditions.

3.

Specialization and the division of labor.

4.

Most problems in an organization result from

structural flaws.

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Mechanistic and Organic System

This system came up as a result of the fast technological

advancements.

British researchers including Tom Burns and G. M. Stalker,

developed the theory of mechanistic and organic systems
of organization while examining rapid technological change
in the British and Scottish electronic industry.

Stable conditions of organizations suggest use of

mechanistic form where traditional pattern of hierarchy,
reliance on formal rules and regulations, vertical
communications, and structured decision-making is possible.

Dynamic conditions of organizations require the use of

organic form where there is less rigidity, more participation,
and more reliance on workers to define and redefine their
positions and relationships.

24

Systems Theory

Since WWII, the social sciences have

increasingly used systems analysis to
examine their assertions about human
behavior.

Systems theory views an organization as a

complex set of dynamically intertwined and
interconnected elements, including its
inputs, process, outputs, feedback loops,
and the environment in which it operates
and with which it continuously interacts.

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Comparison Between Systems & Classical

Theories

Classical theory tends to be one-dimensional

and somewhat simplistic while system
theories tend to be multidimensional and
complex in their assumptions about
organizational cause-and-effect
relationships.

The classical school viewed organizations as

static (unchanging structures,; systems
theorists see organizations as continually
changing process of interactions among
organizational and environmental elements.

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Cybernetics System

Cybernetics is a Greek word meaning

steersman.

Norbert Wiener used this word to mean

multidisciplinary study of the structures and
functions of control and information
processing system in animals and machines.

The basic concept behind Cybernetics is selfregulation-biological, social, or technological

systems that can identify problems, do
something about them, and then receive
feedback to adjust themselves automatically.

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Review

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