Chapter 2

The Evolution of Management Thinking

 Management and Organization

Studying management history helps your

conceptual skills
• Social Forces – influence of culture that guides
people and relationships
• Political Forces – influence of political and legal
institutions
• Economic Forces – the availability, production,
and distribution of resources

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2.1 Management Perspectives over Time
 Classical Perspective

• Emerged during the 19th & early 20th centuries:

– Rise of the factory system
– Issues regarding structure, training, and employee
satisfaction
• Large, complex organizations required new
approaches to coordination and control
• Three subfields: (1) scientific management, (2)
bureaucratic organizations, and (3)
administrative principles

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 Classical Perspectives –
(1) Scientific Management

• Improve efficiency and labor productivity

through scientific methods
• Frederick Winslow Taylor proposed that workers
“could be retooled like machines”
• Management decisions would be based on precise
procedures based on study
• Henry Gantt developed the Gantt Chart to
measure and plan work
• Gilbreth pioneered time and motion studies to
promote efficiency
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2.2 Characteristics of Scientific Management
 Classical Perspectives –
(2) Bureaucratic Organizations
• Max Weber, a German theorist, introduced the concepts
• Manage organized on an impersonal, rational basis
• Organization depends on rules and records
• Managers use power instead of personality to delegate
• Although important productivity gains come from this
foundation, bureaucracy has taken on a negative tone
• DQ: Suppose you are a creative worker, and do not have
much respect on authority. Is a bureaucratic government
job a right choice for your career?

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2.3 Characteristics of Weberian Bureaucracy
 Classical Perspectives –
(3) Administrative Principles
• Focused on the entire organization
• Henri Fayol, a French mining engineer, was a major
contributor – “General & Industrial Management”
• Identified 5 functions of MGMT: planning, organizing,
commanding, coordinating, and controlling
• 14 general principles of MGMT; many still used today:
– Unity of command: Each employee should have only one boss
– Division of work: Specialized employees produce more with the
same effort.
– Unity of direction: Similar activities should be grouped under one
manager.
– Scalar chain: A chain of authority, which extends from the top of an
organization to the bottom.

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 Humanistic Perspective:
(1) Early Advocates

• Understand human behaviors, needs, and

attitudes in the workplace
• Mary Parker Follett:
– Importance of people rather than engineering
techniques: contrast to scientific management
– Empowerment: facilitating instead of controlling
• Chester Barnard:
– Recognition of the informal organization
– Introduced acceptance theory of authority

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 Humanistic Perspective (continued):
(2) Human Relations Movement

• Effective work comes from within the employee

• Hawthorne studies were key contributor
• Human relations paid key variable in increasing
performance
• Employees performed better when managers
treated them positively
• Strongly shaped management practice and
research

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 Humanistic Perspective (continued):
(3) Human Resources Perspective

• From worker participation and considerate

leadership to managing work performance

• Combine motivation with job design

• Maslow and McGregor extended and challenged

current theories
– Maslow’s Hierarchy (Chapter 16)
– Theory X and Theory Y

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2.4 Theory X and Theory Y
 Case Study :
Cisco Systems

• Problem Statement

• Background

• Analysis

• Executive Recommendation

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 Research Proposal (Lee, 2013) :
Generation S / Generation T
• Generation S or Generation T:
– Smart phone, Tablet computer
– Social networking
– Interest in politics:
– Interest in social issues:
– Interest in globalization:
– Interest in technology:
– Interest in innovation:
– Interest in education, training:
– Interest in collaborative work:
• Contribution: How manager can deal with S/T generation
employees.
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 Humanistic Perspective (continued):
(4) Behavioral Sciences Approach

• Scientific methods + sociology, psychology,

anthropology, economics…
• Organizational Development – field that uses
behavioral sciences to improve organization
• Other strategies based on behavioral science:
– Matrix Organizations
– Self-Managed Teams
– Corporate Culture
– Management by Wandering Around
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 Quantitative Perspective

• Also referred to as Management Science (a.k.a.

Operations Research, MS/OR, Decision Science)
• Use of mathematics and statistics to aid
management decision making
– Enhanced by development and growth of the
computer
• Operations Management focuses on the physical
production of goods and services
• Information technology focuses on technology
and software to aid managers
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 Recent Trends:
(1) Systems Thinking
• System = Input  Process  Output
• The ability to see the distinct elements of a situation
as well as the complexities
– The relationship among the parts form the whole system
• Subsystems are parts of the system that are all
interconnected
• Synergy – the whole is greater than the sum of its
parts
– Managers must understand subsystem interdependence
and synergy
• Self-Adaptation: Basic System + [Feedback + Control]

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2.5 Systems Thinking and Circles of Causality
 Recent Trends:
(2) Contingency View
• Every situation is unique, there is no universal
management theory

• Managers must determine what method will work

• Managers must identify key contingencies for the

current situation

• Organizational structure should depend upon

industry and other variables

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2.6 Contingency View of Management
Recent Trends:
(3) Total Quality Management (TQM)

• Quality movement is strongly associated with

Japan
• The US ignored the ideas of W. Edwards Deming,
“Father of the Quality Movement”
• TQM became popular in the 1980s and 90s
• Integrate high-quality values in every activity

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 Elements of TQM

 Employee involvement
 Focus on the customer
 Benchmarking
 Process Improvement
 Each process improvement 
Improvement of the whole organization
 Continuous improvement
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 Innovative Management: Thinking for a
Changing World

• Management ideas trace their roots to historical

perspectives
• New ideas continue to emerge to meet the
changing needs and difficult times
• The shelf life of trends is getting shorter and new
ideas peak in fewer than three years

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 Managing the Technology-
Driven Workplace

• Customer Relationship Management –

technology used to build relationship with
customers

• Outsourcing – contracting functions or activities

to other organizations to cut costs

• Supply Chain Management – managing supplier

and purchaser relationships to get goods to
consumers
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 25
2.7 Supply Chain for a Retail Organization
 Review Questions:
• Describe the major components of the classical
perspectives.
•Describe the major components of the humanistic
management perspectives.
• Discuss the quantitative perspective and its current use in
organizations.
• Explain the major concepts of systems thinking.
•Explain the major concepts of the contingency view.
•Explain the major concepts of the total quality management.
• Name contemporary management tools and some reasons
management trends change over time.
•Describe the management changes brought about by a
technology-driven workplace, including the role of customer
relationship management, outsourcing, and supply chain
management.
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