Evolution of Management Theory - Case Study Example

Introduction: The of management has been useful in addressing business and managerial issues for nearly over a century now.Fundamentally, the challenges faced by managers in the yester century were similar to those faced by the managerial personnel today. For example, Taylor's concern for productivity of employees is a blazing issue with managers today. The first ideas of management were recorded as long ago as in 3000-4000 BC.One instance is the construction of the pyramids in Egypt.100,000 men were employed to work on the pyramids for twenty years, to undertake such a monumental venture major planning, execution and managerial functions were employed. Archeologists and historians have discovered that the Sumerians in 3000 BC practiced a for of record keeping for commerce, a relatively sophisticated method of accounting.Mangment perspectives are also evident in the findings of the Greek and the Roman Empires in the Middle ages. The fundamental problems of managers in that era were similar to those faced in organizations now. Namely-increasing worker productivity, internal competetion, replacing obsolete equipment with new equipment, introduction f new products and product innovation and lastly employee's motivation and morale. EVOLUTION OF MANAGEMENT THEORY The evolution of the management theory can be studied over three distinct periods. CLASSICAL PERIOD (1880-1927) CONTEMPORARY (1930-1962) POST MODERN (1965-present) Classical Period. Technical-Rational View Time and Motion Studies Scientific Management Administrative Principles Bureaucratic Organization Contemporary Period Social Pschycologists Sociologists Organizational Behavior Post Modern Period Economists Sociologists Management Theory-Emphasizing the knowledge basis of organization Classical management Theory. Classical theory is essentially a grouping of similar ideas on the management of organizations that developed in the late 1800's and early 1900's.This theory contains three general branches.Quintessentially, the theory emphasizes on economic rationality of the individual employee at work. The Rational economic view was based on the ideas if the 18th century economist, Adam Smith. According to this school of thought, people are motivated by economic gians, therefore they key to drive employees was monetary reward. Another noteworthy development of the classical period was the introduction of scientific management.F W Taylor is known as the father of scientific management. His contribution to the practice of management is widely recognized. Taylor was the first one to introduce a scientific approach to the study and practice of management. The essence of scientific management can be encapsulated in the following four ideas: 1. Each job should be divided into parts and a scientific method for performing each part should be determined. 2. The method of recruiting and training employees should be scientific as well. 3. Co-operation between the workers and management was regarded paramount to achieve a desirable outcome of the tasks performed. 4. Lastly, emphasis was laid on the idea of division of labour.Managers were to supervise, plan and instruct whereas the workers were expected to carry out the execution part. Further on, Frank and Lillian Gilbreth refined Taylor's methods. They were also pioneers in the field of management and their most important contribution is the time and motion series and emphasis on improving efficency.The components of time and motion series are-break down each action into elements, find better ways to perform it, reoraganize each action to be more efficient. The Gilbreths also studied fatigue problems, lighting, heating and other worker issues. Administrative principles: Another group of classical theorists dealt with the operations of an organization as a whole unlike the aforementioned pioneers who focused mainly on individual workers. The Administrative theorist sought the most optimum way to combine jobs and people into an efficient organization. One of the forerunners of administrative principles was Henri Fayol, who introduced a unified concept of management. Unlike scientific management which concentrated on tasks at the workers level, Fayol's principles were concerned with management and governance level.Fayol introduced the functions of management-planning, organizing, commanding,co-ordinating and controlling. The crux of his theory is planning or foresight. He also developed a list of basic management principles for a successful organization. Following is an enumeration of Fayol's principles: 1. Division of Work 2. Authority and Responsibility 3. Discipline 4. Unity of Command 5. Unity of Direction 6. Subordination of Individual interest to general interest 7. Remuneration of Employees 8. Centralization 9. Scalar Chain 10. Order 11. Equity 12. Stability of personnel 13. Initiative 14. Espirit de corps Fayol's ideas have had an important impact in some aspects of management, most importantly the organizational process. Bureaucratic Organization: Max Weber is associated with the development of bureaucratic approach of management. Bureaucracy owed its birth to the managerial abuse of power in that period. It was designed to eliminate waste and inefficiency in an organization. The important principles of bureaucracy are- 1. Division of labor by functional specialization 2. A well defined hierarchy of authority 3. Well defined rights and duties of employees 4. A system of procedures for dealing with work situations 5. Impersonal relationships between people 6. Promotion and selection of employees based on technical competence. Closing Thoughts on the classical theory: The Classical principles evolved during the late 19th and early 20th century. The prevalent social, economic and political conditions were largely responsible for the birth of classical notions. The United States recuperating from the Civil War and was beginning to transform into an industrialized economy. It was in the middle of a political and social upheaval. Most organizations in that period were small, inefficient units. The workforce consisted of immigrants as thousands of people were dislocated, with limited education and skillsets.Therefore it is understandable why the ideas of scientific management and bureaucracy were found suitable in that era. The administrative principles were useful as big companies were beginning to come up. However the applicability of classical notions in this age is limited, although it is undeniable that many modern management practices came from the idea laid by the classical theorists. For example, the rational economic view might have been correct in that era, given the social and economic of of 1900's, however it has much less relevance today. The prosperity and educational levels have gone up and there is most political stability. These factors have altered the mindset and aspirations of the people, therefore monetary gains cannot be regarded as their sole motivator.Furthermore, the classical theory assumes that all organizations can be governed by a set of principles. This doesn't hold true anymore with growth and diversification of complex organizations.Bureaucracy, in particular has been losing its foothold in this age. It is associated more with red tape and inefficiency and finds little acceptance as a managerial Practice today. Contemporary The Human relations approach developed from the 1920's to 1950.The underlying idea of this approach was, the economic incentives alone are not enough to motivate employees and that their social needs are also paramount. Therefore it focused on a human-oriented approach of management. The main ideas of the social view were: Employees are motivated by social needs Inter personal relationships are important and impart a sense of identity to a person. Industrialization and division of labor tends to make work routine and does not yield job satisfaction. Social factors are a bigger motivation for employees than economic factors. This emphasis on social needs led to the development of management strategies for improving the human and social skills of managers. Behavioral Science Approach: Organizational humanists contended that highly specialized jobs inhibit the employees from using their creativity. Besides this, their objective was to reduce the rules and rigidity in the functioning of organizations. This perspective still holds relevance and has been incorporated as an important managerial practice. Companies like Levis Strauss encourage employees by giving them challenges and reposing decision making power with them. This approach has yielded positive results as employees tend to significantly contribute towards product innovation. Conclusion The future of management: Perspectives of Peter Drucker. Peter Drucker's ideas have influenced the course of business management in the 20th century, in a very significant way. He practically invented management as a discipline profound social and economic challenges to occur in future and emphasis the need of the management (not the government or the free markets) to tackle with this transition and address the new realities. In his work, 'Managements new paradigms', Drucker rejects many assumptions on which management theory has been based. The assumptions adopted by Drucker are appropriate for a knowledge based economy. He envisages that the changes likely to occur will be more impactful than the structural changes caused by the Second World War or even the Great Depression. In the midst of such changes he contends five political and economic certainties that will determine business strategy in the near future. The plummeting birth rate in the developed countries, the shift in the distribution of disposable income, a redefinition of corporate performance, global competitiveness and the growing incongruence between economic and political realities. Drucker's essential principles include- Management is about all sectors, not exclusively business. Management entails managing yourself as well as others Drucker emphasized the importance of knowledge in the changing scenario-he coined the term knowledge worker in the late 1950's. Some of the tools he advocated for knowledge workers include the following ideas-results are on the outside of an organization, planned and systematic abandonment, focus on results and responsibilities not good intentions and empowerment alone. REFERENCES 1. Historical perspective on productivity improvement; scientific management and Fredrick Winslow Taylor Available at-http://www.accel-team.com/scientific/scientific_02.html 2. Peter Drucker: The Ultimate Knowledge Worker-Bruce Rosenstein USA Today Library Available at-http://www.ibiblio.org/slanews/conferences/sla2006/presentations/drucker.pdf 3. Forbes.com-A couple of assumption busters; James W Michaels; 10th May 1998 Available at-http://www.forbes.com//forbes/1998/1005/6207014a.html 4. The Evolution of Management Thought Available at- http://www.biz.colostate.edu/faculty/dennism/Management-Evolution.html 5. The Evolution of Management Theory Available at-http://www.viterbo.edu/perspgs/Staff/MFranz/chap4_fast/tsld010.htm l Read More