MANAGEMENT HISTORY:

Theories and Application

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Overview
• Historical background of management
• Classical Approach

• Quantitative Approach
• Behavioral Approach
• Contemporary Approaches

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Historical Background of
Management
• Ancient Management
 Egypt (pyramids) and China (Great Wall)
 Urban settlements of Mohenjo-daro

• Adam Smith
 Advocated division of labor
(job specialization) to increase
the productivity of workers

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Historical Background of
Management
• Industrial Revolution
 Substituted machine power
for human labor
 Created large organizations
in need of management

• Use of the term ‘Manager’

 In 1908, the title ‘City Manager’ in Staunton, Virginia.

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Historical Background of
Management (cont’d)
• Business Application
 First systematic application of management
principles in a business enterprise was in
1950 by General Electric

• Management Education
 In 1819 ECSP Europe in Paris.
 In 1881 Wharton Business School in Philadelphia,
Pennsylvania, USA.
 Which is the first business school in Pakistan?

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Major Approaches to
Management
• Classical
 Scientific Management
 General Administrative Theory

• Quantitative
• Behavioral
• Contemporary

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Scientific Management
• Fredrick Winslow Taylor
The “father” of scientific management

Published Principles of Scientific

Management (1911)

One best Economic

Productivity
way incentive

200%
Right
person on
the job

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General Administrative Theory
• This approach focused more on:

What Managers
do

Good
Management of
management
organizations
practices

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General Administrative Theory
• Henri Fayol
 Managing director of a large French
coal-mining firm

 Developed principles of management (1916)

 Identified five functions of managers:

Commandin
Planning Organizing Coordinating Controlling
g

 Developed 14 principles of management

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General Administrative Theory
(cont’d)
• Max Weber
 German sociologist in early 1900s

 Developed a theory of authority based on an ideal

type of organization (bureaucracy)

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General Administrative Theory
(cont’d)
Career Orientation

Division of labor

Authority hierarchy
Bureaucracy
Formal selection

Rules and regulations

Impersonality

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Quantitative Approach to
Management
• Developed during World War II to manage
logistical problems.

• Operations Management / Operations Research

Mathematical Solve quantitative

Use of computers
models problems

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Quantitative Approach to
Management (cont’d)
• Edwards Deming
 Statistical quality control
 Introduced ‘quality circles’
• Joseph Juran
 Organization of production in factories
 ‘Just-in-time’ (JIT) approach

• Initial application of these approaches was

successfully done in Japan

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Quantitative Approach to
Management (cont’d)
• Total Quality Management (TQM)
 It is an integrated, organization-wide strategy for
improving product and service quality.

 TQM is not a specific tool or technique rather an

overall approach to management that is characterized
following principles:
Customer Accurate
focus measurement

Continuous Teamwork
improvement
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Behavioral Approach
• Organizational Behavior (OB)
 The study of the actions of people at work;
 Emphasized individual attitudes and
behaviors, and group processes.

• Earlier Behavioral Studies

 Hawthorne Studies
 Management roles (Hugo Munsterberg)
 Motivational theories

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The Hawthorne Studies
Conducted by Elton Mayo and associates at Western
Electric (1927–1935)
1. Intended as a group study of
the effects of a piecework
incentive plan on production
workers.

 Workers established informal levels of acceptable

individual output;
 Over-producing workers (“rate busters”)
 Under-producing workers (“chiselers”).

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The Hawthorne Studies (cont’d)
Conducted by Elton Mayo and associates at Western
Electric (1927–1935)

2. Workplace lighting changes unexpectedly affected both

control and experimental groups.

3. Interview program
 Confirmed importance of human behavior in the
workplace.

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Contemporary Approaches
• Most of these earlier approaches focused on
managers’ concerns inside the organization.
• Starting in the 1960s, management researchers
began focusing on factors outside the
organization.

Internal Classical Quantitative Behavioral

Factors approaches approaches approaches

External Contemporary

Factors approaches

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Contemporary Approaches
(cont’d)

Systems
Approach
Contemporary
Approaches
Contingency
Approach

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The Systems Approach
• Systems
 A system is an interrelated set of elements
functioning as a whole.
• Open system • Closed system
 An organization that  An organization that
interacts with its does not interact
external environment. with its environment.
• Subsystems
 The importance of subsystems is due to their
interdependence on each other within the
organization.

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Subsystems in an Organization

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The Organization as an Open System

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The Contingency Approach
Situational Approach

There are no universally applicable

management principles

Organizations are individually different

Require different ways of managing

If – then approach is required

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 Popular Contingency Variables

• Organization size
• As size increases, so do the problems of coordination.
• Routineness of task technology
• Routine technologies require organizational structures,
leadership styles, and control systems that differ from
those required by customized or non-routine
technologies.
• Environmental uncertainty
• What works best in a stable and predictable environment
may be totally inappropriate in a rapidly changing and
unpredictable environment.
• Individual differences
• Individuals differ in terms of their desire for growth,
autonomy, tolerance of ambiguity, and expectations.
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Conclusion

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Questions and Feedback

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