JIMMA UNIVERSITY

INSTITUTE OF HEALTH SCIENCE

SCHOOL OF PHARMACY
 Pharmaceutical Leadership And Management Seminar

Title: Evolution Of Organization And Management Theories

GROUP MEMBERS

1.Emebet Tameru
2.Hirbo Wege
3.Kayriya Muktar
4.Mahider Ayana
5.Muluken Tolera
 Out line
1. Introduction
2. Classical Approach
2.1 The Scientific Management Theory
2.2 Administrative/ Classical Organization Theory
2.3 Bureaucratic Organization Theory
3. Behavioral Approach
3.1 Human Relation Theory
3.2 The behavioral Science Theory
4. Modern Organizations and Management Approach
4.1 Systems Theory
4.2 Contingency Theory
4.3 Quantitative Approach
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Objective

 To Describe the Evolution of Management theory and their

key concepts
 To Describe the contribution of each theory
 To identify the critiques and challenges of each theory that
leads to the emergence of the other.
 1. Introduction

• Evolution of organization and management theories has been a

dynamic and trans-formative journey,
 reflecting the ever-changing landscape of business and society.

 In the early 1900s, the classical school of thought, represented by

pioneers like F. Taylor and H. Fayol,
 laid the foundation for organizational management.
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 Cont.…

 As industries expanded and diversified, so did the need for

more flexible and adaptable management approaches.
 The mid-20th century witnessed the rise of the human
relations movement, spearheaded by researchers Elton
Mayo
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 Cont.….
 This perspective emphasized the role of social and
psychological factors in the workplace,
 challenging the mechanistic views of the classical era

 The latter part of the 20th century witnessed the emergence of

various contemporary management theories including:
 Systems theory, contingency theory, and organizational culture studies.
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Cont.…
 21st century

 the evolution of organization and management theories continues in response to the

rapid pace of technological advancements, globalization, and shifting socio-cultural
dynamics

 In conclusion
 the evolution of organization and management theories spans several
centuries and has been influenced by various social, economic, and
technological changes.
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 Classical management theory
 The advent of industrial revolution and power driven machines resulted in;
 production workers and factory systems needed highly coordinated work
processes.
 As a result, the old order of the organization process was obsolete
 Classical theory emerged as an answer to this challenge.
 The classical theories concentrated on:
– organization structure for the achievement of organizational goals and

– also developed certain principles of management.

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 Classical management …

 Classical theorists viewed the organization as a machine and

– the humans working in these organizations as the components of this
machine.
 The classical theory comprises three schools of thought comprising:-

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 Classical management …

 Scientific management: emphasized the one best way to complete a line of

work,
 Bureaucratic management: focuses on hierarchy, rules and procedure, and
clear division of labor, and
 Administrative management: emphasized the transmission of information
across the organization.

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 The Scientific Management Theory

 Influential classical scientific management theorists include;

– Dr. Frederick Taylor as well as Frank Gilbreth and his wife, Dr. Lillian
Gilbreth

 Scientific management approach came from the first industrial revolution.

– Because it brought about such an extraordinary mechanism of industry.
 Frederick W. Taylor launched a new movement in 1910 which is known as
‘Scientific Management’.
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 The Scientific Management Theory

 Scientific management means “knowing exactly what you want men to do

and seeing that they do it in the best and cheapest way”.
(F .W. Taylor 2011)
 Taylor designed a number of time and motion studies to determine the one
best way to complete a specific task.
– referred to methods for calculating production efficiency by recording
outcomes and time to produce those outcomes.

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 Four principles of scientific management

 Apply the scientific method to analyze work and determine the most
efficient way to perform every task.
 Match workers to jobs based on their capability and motivation and train
them to work at maximum efficiency.
 Provide instruction and supervision to ensure that the “best” method is being
used to complete each task.
 Divide work between managers and workers, with managers focusing on
planning and training and workers focusing on production
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 Grounds for criticized scientific management

1. Mechanistic Approach: it treats workers as factors of production and not as

human beings.
2. Unrealistic Assumptions: people are rational and motivated by material
gains.
– financial gain is not the only one thing that matters.
– Workers also want job satisfaction, participation and recognition.

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 Grounds for criticized scientific management

3. Narrow View: Scientific Management is quite limited in scope.

o It does not deal with the management of the total organization.

4. Impractical: Many ideas of Taylor are said to be infeasible in practice.

 For example, planning cannot fully be separated from doing because these are
two sides of the same job and are not different jobs.

5. The exploitation of Labor: in the name of increasing efficiency, workers

were forced to speed up affecting their physical and mental health.

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 Administrative Theory

 Is another well-known classical management theory developed by

Henry Fayol in 1916.
 As organizations grew and became more complex,
– the need for a systematic understanding of the overall
management process was felt.
 Managers became more concerned with the management of
organizations than with improving the efficiency of individual jobs.
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 Administrative …

 They tried to identify the functions of a manager with emphasis on:

 coordination of resources towards the achievement of
stated objectives.
 This stream of the classical approach is known as Administrative Theory.
 Henry Fayol introduced six functions and fourteen management principles
in his theory.
 Six management functions are predicting, planning, organizing,
commanding, coordinating, monitoring.

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 H. Fayol fourteen management principles

1. Division of labor: Fayol believed that work specialization is the best way to
use human resources.
2. Authority: Fayol discussed authority as the right to give orders and the
ability to exactly obey and do what was ordered.
3. Discipline: Discipline is essential for success of an organization.
4. Unity of command: workers would be given orders just by an individual (the
manager)
5. Unity of direction: the entire organization needs to move towards a common
goal in a common direction.

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 …fourteen management
principles
6. Focusing on individual interests rather than public interests.
7. Remuneration: an equitable, uniform payment system that
motivates ,contributes to organizational success.
8. Centralization: the degree to which authority rests at the top of the
organization.
9. Scalar Chain: Chain like authority scale.
– Most vs. least authority
10. Order: the individuals and agents should be at the right place at the
right time
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 …fourteen management principles
11. Equity: All employees should be treated fairly and properly.
12. Stability of tenure of personnel: Long-term employment is important
for the development of skills that improve the organization’s
performance.
13. Initiative: The fostering of creativity and innovation by encouraging
employees to act on their own.
14. Esprit de corps: Harmony, general good feeling among employees,
shared enthusiasm, foster devotion to the common cause
(organization).

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 Critics of Fayol’s Administrative
theory

1. Too formal: Fayol’s theory is said to be very formal.

2. Vague: Some of the concepts have not been properly defined
 the principle of division of work does not tell how the task should be
divided.
3. Inconsistency: theory were based on personal experience and limited
observations.
4. Pro-management bias: Workers are treated as biological machines
5. Historical value: relevant when organizations operated in a stable and
predictable environment
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 Bureaucratic Approach of
management

 Proposed by Max Weber in 1947.

 Use of rules, hierarchy, a clear division of labor, and detailed procedures to guide
employees’ behaviors.

Characteristics of bureaucratic management

 Division of work: splitting work into specialized positions

 Rules and Regulations: formal guidelines for the behavior of employees on the job

 Hierarchy of Authority: ranks jobs according to the amount of authority in each job

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 Bureaucratic Approach of
management

 Technical Competence: Selection and promotion of jobholders are

based on their technical competence.
 Record Keeping: Every decision and action is recorded
And preserved in its original as well as draft form.
 Impersonal Relations: Official positions are free from personal
involvement, emotions, and sentiments.

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 Advantages of Bureaucracy

 consistency of actions.
 Rationality
 Efficiency
 Competence: proper delegation of authority
 Predictability: The behavior of the employees is predictable
 Impartiality: Officials are guided by the policies, rules and regulations rather
than their personal whims and faces

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 Disadvantages of Bureaucracy

 Rigidity in Operations
 Delay and Red Tape: the rules may become a source of inefficiency leading
to delays in operations.
 Ineffective Communication: communication from the top level to the lowest
level will take a very long time.
 Lack of personal touch: It does not allow interpersonal relations between
employees and informal groups in the organization.

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 Criticism of Classical Theory

 Narrow view of organization

 Assumption of a closed system
 Assumption about Human Behavior
 Economic rewards as main motivators
 Lack of empirical verification
 based on personal experience and limited observations
of the practitioners.
 Excessive emphasis on rules and regulations

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Behavioral Approach

 Human Relation Theory

 Behavioral Science Theory

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