CHAPTER 2 MANAGEMENT THOUGHT: PAST AND PRESENT

CHAPTER 2

MANAGEMENT THOUGHT: PAST AND PRESENT



LEARNING OBJECTIVES

After studying this chapter, you should be able to:

1.
Discuss why knowledge of the evolution of management theories is important to
managers
2.
Explain the contributions of the following:
a.
Classical schools of management thought
b.
Behavioral school of management thought
c.
Quantitative school of management thought
d.
Systems school of management thought
e.
Contingency school of management thought
f.
Quality school of management thought

CLASSICAL MANAGEMENT THEORY
A. Classical Scientific School

The classical scientific branch arose as a result of a need to increase productivity.

1. The emphasis was to try to find the one best way of getting work done by
examining the way work was accomplished, the sequence of steps, and the skills
of the workers in order to increase efficiency.

2.
Major contributions include Frederick Taylor and Henry Gantt.
3. The emphasis on job specialization and time and motion studies are the
foundations for efficiency in work.
4. These theorists provided a rational approach for examining work-related
problems.
5. Assessment: many of the school’s theories, principles, and methods (such as
time and motion study) are with us today, but have been modified to include other
things such as people skills.

B. Classical Administrative School

The classical administrative branch grew out of the need for guidelines to manage the
complex organizations that emerged from the Industrial Revolution. It focused on
productivity also.

1. The emphasis was on the development of managerial principles rather than work
methods.
2.
This school accommodates a belief in studying the flow of information.
3.
These theorists aimed at understanding how an organization operated.
4.
Major contributors included Henri Fayol and Chester Barnard.


5. Fayol provided fourteen principles of management based on his management
experiences. These principles provide modern-day managers with general
guidelines to organize and administer.

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6. Assessment: the school’s bureaucratic approach has both benefits and
limitations, but the school paved the way for the behavioral or human relations
school.

BEHAVIORAL MANAGEMENT THEORY
A. Behavioral
School


1.
The behavioral management school took management another step forward.
2. By focusing on employees as individuals, as parts of work groups, behaviorists
forced management to view the work environment from another stance.
3. Modern-day managers now view employees as individuals, as resources, and as
assets to be developed and worked with—not as machines.
4. Major contributors included Robert Owen, Mary Parker Follett, Elton Mayo, and
Douglas McGregor.
5. Assessment: the school integrated ideas from sociology, anthropology, and
psychology with management theory, but its major limitation is its complexity.


Enrichment Vignette – Hawthorne Studies

The “Behavioral School Proponents” portion of this chapter (see chapter outline above)
mentions the studies at the Hawthorne Works of Western Electric near Cicero early in the last
century. The studies yielded great insight as to how to improve productivity, and the insights
from those studies have a broad range of applications. For thousands of years, managers tried
to get more output from workers by either using fear or financial rewards. Later, managers found
that they could improve productivity through better methods and technology.

However, the Hawthorne experiments yielded a new way to improve productivity: provide
people with recognition and dignity in a group environment. The result: recognition of the
potential when people do things not just because they have to do so but because they want to
do so. History has many examples of a military force that may have been inferior in numbers
and technology but that overcame what would seem to be a superior force because it was
highly motivated but its enemy was not. During the past twenty years, many corporations that
were global giants have since gone into bankruptcy, were taken over by others, or are now only
a fraction of what they once were, while smaller organizations with dedicated people have taken
the place of the former giants.

The moral of the story is not that motivation is more important than methods,
technology, or financial resources. However, an organization’s potential is greatly enhanced
if one combines a motivated workforce with its other resources and capabilities.



QUANTITATIVE MANAGEMENT THEORY
A. Operations Management

1. Models, simulations, and games that are applied to manufacturing or service
industries are primary to this area of work.
2. Various production measuring techniques such as inventory models, break-even
analysis, and queuing theory constitute operations management.

B. Management Information Systems

1. MIS is a computer-based system that provides decision-making information to
managers.

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2. For quite some time American companies lost sight of customers and quality by
being preoccupied with quantitative theories.


C. Assessment

1. Quantitative tools can be useful in making decisions but do not eliminate the need
for sound judgment and experience.

SYSTEMS MANAGEMENT THEORY
A. Systems
School

1.
The internal systems of an organization are its subsystems.
2.
Many of the functional areas of an organization are its subsystems.
3.
All subsystems interact with each other.
4.
Managers control subsystems.
5.
Most external systems are beyond the control of management.
6. Groups, other organizations, and the government influence or place pressure on
many businesses.


B. Cumulative Energy of Synergy

1. Systems and Synergy: The whole is greater than the sum of its parts.


C.
Assessment



This school helps managers to view the interrelationships within organizations, but
considering the complexity of organizations may result in being overly cautious.

CONTINGENCY MANAGEMENT THEORY

A. Contingency
School

1. Variables, flexibility, and adaptation make up the ingredients for contingency management.
2. Drawing upon the past to accommodate the present and predict the future are
considerations for contingency thinking.

B.

Assessment

1. The approach helps managers to develop fallback positions and think creatively. It
has contributed to quality management theory.



QUALITY MANAGEMENT THEORY

A. Kaizen Approach

1.
Japanese in origin.
2.
Small incremental steps of improvement.
3.
Quality pays for itself over time.

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B. Reengineering
Approach

1.
Change is constant. It will always occur.
2.
Setting direction through vision.
3.
Rapid and radical changes may be needed.
4. Companies must ask: “What do we do best?”


C. Major Contributors to Quality Management

1. Foreign competition has forced the focus on quality.
2. Figure 2.4 lists the names of major contributors to quality.

D.
Assessment





1. This school has its roots in the other schools and is the most current.


NOTE: Be sure to read the Application Case (Ford Motor Company) on pages 59-60. Be
prepared to discuss the three questions that accompany it.

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