The Development of Management Thought

The development of management thought
The evolution of management thought can be divided in to three stages:
1, classical theories of management
2, The Neo-classical Theory
3, Modern Management Theories
1, Classical management theory

Classical management theory is a set of principles and concepts on an organization and
management. This theory consists of three streams:
1. Scientific management school

2. Administrative management school
3. Bureaucratic organization theory
Scientific management
Scientific management emphasized faster and better methods or production and also
increased output and efficiency. Primary emphasis was on the analysis, planning and control
functions related to performance of basic tasks. Its emphasis was for achieving efficiency,
standardization and simplification.
Fredrik w. Taylor (1856-1915): He is considered as the father of scientific management. He

stated that the object of management should be to secure the maximum prosperity of each
employee.
According to Taylor, scientific management in its essence, consist of a certain philosophy

which results in the combination of four great principles of management:
* The development of true science

scientific education and development of workers
* The scientific selection of workers
* Intimate friendly cooperation between management and labor
2
Taylor observed that inefficiency prevails in the organization because of the following
causes:
- Workers feel that any increase in output would lead to an employment.

- Defective system of management and because of these, each workers restricts his output
in order to safeguard his interest.
- Inefficiency rule of thumb efforts and wasting methods of work.
Scientific management criticized on: the ground that a worker was assumed to be a more or
less standardized unit of production concerned only with pay. More stress was laid on the
methods of improving production without considering the effect on the worker. Taylor failed to
understand the complexities of human behavior and hence no advance was made in the human
aspect of work in an organization.
Administrative management
H. Fayol (1861-1919): Identify management as a separate set of skill or functions performed by

a supervisor in an organization. He clearly distinguished difference between technical and
managerial skill. He stated that technical ability is more dominant at the lower level of
management, whereas managerial ability is more important at the higher level of management.
He stated fourteen management principles these are:
1, Division of labor: To get greater efficiency make tasks simpler
2, Authority and responsibility:
Authority: The right of giving orders to subordinates.
Responsibility: Obligation with respect to the performance and achieving goals in a

satisfactory manner.
3, Unity of command: Employees should receive orders from one.
4, Scalar chain: From top to bottom there should be a clear line of authority.
5, Unity of direction: The organization member effort should be directed towards common
goods.
6, Centralization
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7, Equity: Respect and fairly treat all employees
8, Order: Each employee and other resources are put where they have the most value.
9, Initiative: Encourage workers to act on their own to take initiative that benefits the
organization.
10, Discipline
11, Stability of tenure of personnel: The payment system should be fair.
12, Remuneration of personnel: Helped employees develop the skills to make contributions to
the organization.
13, Subordination of individual interest to general interest
14, Esprit De Crops: creating team sprit among workers.
Some critics: The principles professed by this theory are only proverbs because they were
based on observation and not on search. Also the concept of universality of management has
been criticized.
*In general, the administrative theory was mainly concerned with the conceptualization of
principles and functions of management in large organization. This theory provided guidance on
how to design an organization and provided the concept of line and staff organization.
Bureaucratic organization theory
Max weber (1914-1920): He offered a bureaucratic model for management of a large and
complex organization in any branch of human activity. According to him bureaucracy it the
most efficient form of management for a complex organization.
Elements of bureaucratic theory:
* Hierarchy of authority
* Clear cut division of work based on upon competence and specialization
* System of rule and regulation
* Procedure
* Impersonality
4
This theory has been criticized on the following grounds:
- It provided a rigid machine model of an organization and not a humanistic model.

- It has ignored the importance of human interpersonal and mutual relation in an
organization.
- Its impersonality would not permit competitive leadership.
2, The Neo-classical Theories

In this theory, we find classical theory in a modified and improved form. The human relation
and behavioral science approach is the core of neo-classical theory. The human factor and
values are given much importance in this approach.
 Human relation approach
This theory stated that the employee morale has great influence on productivity and the
manager should treat them as social beings instead of economic beings or simply as cogs in a
machine. For solving any management problem, the manager should understand group
attitudes and psychology as employees are members of a group.
 Behavioral science approach
The behavioral science approach thoughts through its research studies of individuals behavior
and motivation indicated that the relation between morale and productivity was oversimplified
and there is no direct and deep connection between morale and productivity.
Elements of Neo-classical theory
*Individual *work group
*Participative management *Orientation
*Motivation *Leadership
*Employee development
5
3, Modern management theory
Modern management theory consists of three streams:
1, Quantitative theory
2, System theory
3, contingency approach
1, Quantitative theory
Also known as operations research offers systematic analysis and solution to many complex
problems faced by the management. For decision making, this approach makes use of
mathematical and statistical tools. Operation research is the most widely accepted branch of
management science.
2, System theory
System means to bring together or to combine. A system is a set of interconnected and

inter-related elements or components parts to achieve certain objectives. The systems
approach has made a significant contribution to management discipline and practice.
A system may be classified in to two:
Closed system: Has no environment and no outside system impinge on it.
Open system: Has an environment and it interact with it.
3, Contingency approach
This approach focuses on applying management principles and process as dictated by the
unique characteristics of each situation. It emphasized that there is no one best way to manage
and that it depends on various situation factory, such as the external environment, technology,
organizational characteristic, characteristic of the manager and subordinates.
6
Reference
*An introduction to business management from page 13-24.

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The development of management thought

The evolution of management thought can be divided in to three stages:

1, classical theories of management

2, The Neo-classical Theory

3, Modern Management Theories

1, Classical management theory

1. Scientific management school

Fredrik w. Taylor (1856-1915): He is considered as the father of scientific management. He

According to Taylor, scientific management in its essence, consist of a certain philosophy

* The development of true science

* The scientific selection of workers

* Intimate friendly cooperation between management and labor

- Workers feel that any increase in output would lead to an employment.

H. Fayol (1861-1919): Identify management as a separate set of skill or functions performed by

He stated fourteen management principles these are:

1, Division of labor: To get greater efficiency make tasks simpler

2, Authority and responsibility:

Authority: The right of giving orders to subordinates.

Responsibility: Obligation with respect to the performance and achieving goals in a

3, Unity of command: Employees should receive orders from one.

11, Stability of tenure of personnel: The payment system should be fair.

13, Subordination of individual interest to general interest

14, Esprit De Crops: creating team sprit among workers.

Bureaucratic organization theory

Elements of bureaucratic theory:

* Clear cut division of work based on upon competence and specialization

* System of rule and regulation

- It provided a rigid machine model of an organization and not a humanistic model.

2, The Neo-classical Theories

 Human relation approach

 Behavioral science approach

Elements of Neo-classical theory

*Individual *work group

*Participative management *Orientation

System means to bring together or to combine. A system is a set of interconnected and

A system may be classified in to two:

Closed system: Has no environment and no outside system impinge on it.

Open system: Has an environment and it interact with it.

*An introduction to business management from page 13-24.

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