The Role of the Scientific Management Theory and the Classical Organizational Theory - Essay Example

Management Introduction Principles of management are one of the most dynamic concepts of the management literature and it has been a recurrent concept in the works of the academicians and the managers. There are a number of theories of effective management that has evolved over the course of time. The purpose of this paper is to discuss three of the main theories namely Taylor’s four principles of management, Fayol’s 14 principles and Weber’s five principles. The idea is to explore the extent to which the traditional theories of management are relevant in the contemporary times. This will help in unearthing the challenges that are being faced by the managers at present and help in recommending strategic solutions to their problem. Rational Perspective The works of Taylor is one of the most remarkable ones in the management literature and it comes under the scientific management school of thought. Taylor had advocated that there are four principles of management. Taylor was the first one to advocate that the rule of thumb that was used in the management houses was rather inefficient and they had to be replaced by a scientific process which is not random (Wren, and Bedeian, 2009.). He had propagated that there is no actual rule of thumb and business houses should be driven by optimum goals. The ability to achieve the goals should be linked to rewards and the failure to do so must result in punishment (Taylor, 2004). Taylor (2004) had prudently pointed out that the goals of the business cannot be met unless the workers are selected in a prudent manner. His research was the first one to point out that workers should be trained in a scientific manner according to the needs of the job so that he can deliver the best performance. Thirdly, Taylor had pointed out that team works is one of the most scientific techniques which should be used by managers in order to obtain optimum results. In the final step Taylor had suggested that the senior management and the working class should divide the work in appropriate proportion to obtain the best results (Taylor, 2004). The alternative explanation to the principles of management was provided by the classical organizational theory. These theories were developed around the same time as the scientific management theory (Wren and Bedeian, 2009). Weber had explained his theory with the help of five major principles which ensures that the bureaucratic organizations function smoothly (Du Gay, 2000). According to the first principle the power of a manager is derived from the position that he holds in the organization. Weber was very particular regarding the role of the agents in the bureaucracy and had pointed out that only eligible candidates must hold a particular position which should not be based on personal contacts. A bureaucratic organization can only function effectively if the tasks and responsibilities of each of the workers are described in a transparent manner. Each layer of management should be functioned in such a manner so that the employees can have an idea about the person they are going to report to (Du Gay, 2000). Finally, a bureaucratic organization can only be successful if managers create a proper set of rules and operating procedures so that the behaviour of the agents can be controlled. Fayol was another major proponent of the Classical Organization Theory and he is famous for his work of administrative theory. The achievement of Fayol’s (1949 cited in Wren and Bedeian, 2009) theory was that it was able to highlight the role of the managers and the way they should formulate strategies. The research of Fayol (1949 Wren and Bedeian, 2009) had highlighted five major functions of the management namely formulating plans, organizing activities, commanding, and finally controlling. Fayol had pointed out that planning or forecasting is important to comprehend the short and long-term needs of the organization. The act of organizing on the other hand is closely related to the allocation of resources to achieve the goals. Coordination is alignment of the multiple resources to achieve the common goals. Controlling ensures that deviations from the set path are corrected as soon as possible. Figure 1: Fayols 14 principles (Source: Author’s creation) The above chart shows the fourteen principles of management that has been developed by Henry Fayol. Each of these functions is clearly aligned to the five principles of management that had been developed by Fayol. Some of the elements like unity of command and centralization had strong similarity with the ideas of bureaucracy that was developed by Weber. Similarly items like division of work and discipline can be loosely compared with the principles of scientific management which had focused on scientific management of workers (Wren and Bedeian, 2009). Prevalence of the Principles The contemporary management literature has witnessed growth of a number of theories in effective management but the theories developed by Taylor, Fayol and Weber is quite relevant to this date. The research conducted by Rodrigues (2001) had particularly focused on the evaluation of the 14 principles of Fayol. The findings from his research has suggested that though the basic premise of Fayol’s theory may be prevailing in the current management scenario but the principles require extensive adjustment before they can be used. The research had also suggested that out of all the 14 principles some of the principles like training and development are extensively practiced in organizations but others are not used very frequently. Some of the organizations like government agencies, religious institutions and large steel manufacturers still find Fayol’s principles useful but this is not the case for all (Rodrigues (2001). Therefore, in summary it can be commented that some organizations have found Fayol’s principles of management quite effective while most of the others had to modify it to make it suitable to the changing market environment. Another research work conducted by Giannantonio and Hurley-Hanson (2011) had researched about Taylor’s scientific management principles in the latest management scenario. The findings from his research suggest that the traditional principles of management that had been proposed by Taylor are not quite applicable in the present times but certain theories and practices proposed by him are quite relevant. The era of globalization has intensified the business environment and the manufacturing processes are getting highly complex. In such a scenario the concept of scientific development of the workforce is of utmost importance as has been pointed out by Taylor (Giannantonio and Hurley-Hanson (2011). The aspect of motivation and training of workers has been closely related to high performance as was pointed out by Taylor more than hundred years ago. The contemporary theory of management suggests that management is an integrated process that involves planning and forecasting, taking prudent decisions and transparent financial reporting. Giannantonio and Hurley-Hanson (2011) points out that, these are nothing more than extensions of the scientific development of workforce suggested by Taylor. A meta-analytical technique was employed by Walton (2005) to understand whether the theories and principles propagated by Weber (1946 cited in Walton, 2005) still prevail in the present business environment or not. This research had considered data over a period of four decades to enhance the validity of the results. The findings from his study suggest that the principles of bureaucracy suggested by Weber can be generalized to a great extent. Bureaucratic organizational controls have been subjected to systematic criticism stating that this type of an organizational control had no function in the modern organizations (Walton, 2005). However, the study of Walton shows that though the bureaucratic organizations may have its own share of shortcomings there is no denying the fact that the bureaucratic organizational control may act as a good starting point for better forms of organizations. The researcher was also successful in showing that organizational structures involving flatter hierarchies and empowered workers can co-exist simultaneously with a successful bureaucratic organization (Walton, 2005). This implies that the ideas that had been developed by Weber are not completely invalid. The New Era Globalization is a phenomenon in the world business scenario that has significantly altered the ways in which they operate. It brings a host of opportunities as well formidable challenges for businesses. Managers face a host of challenges in the present times with infiltration of new forms of technology, e-commerce platforms and more demanding customers. This is coupled by the increasing drive of sustainable business practices and stringent corporate governance bordering on ethical practices. The synthesis of the literature shows that both the scientific and the classical organizational theory had failed to incorporate these factors as they were not relevant back then. Technology now plays a very important role in the business scenario and most of the tools of planning and forecasting are based on advanced technological software (Kraemer, Gibbs and Dedrick, 2005). E-commerce has successfully captured all the aspects of business ranging from the design of products to the satisfaction of customers. Traditional organizations did not have these aspects for which Taylorism, Weber’s and Fayol’s organizational management theories did not consider the attributes of these new organizations. Though the nature of the organizations is changing rapidly, there is a growing consensus among researchers that management is a universal concept and the existing theories are quite instrumental in developing a proper management. The basic function of managers revolves around planning, organizing and controlling the key activities of an organization (Kraemer, Gibbs and Dedrick, 2005). The department of e-commerce in most of the multinational companies also has to rely on the key managerial skills of planning, allocating and coordinating the functions of different people so that the organizational outcomes can be achieved. The last decade had witnessed a number of corporate scandals and unethical business practices which has enhanced the focus on ethics in management (Campbell, 2007). The increasing importance on the ethics highlights the importance of Taylor’s management principles that had for the first time shown that ethics was an integral part in the development of organizational workforce. The era of globalization represents formidable challenges to the managers as the relationship with the suppliers and the customers are largely guided by ethics. There is a growing consensus among researchers that business ethics has become an important part for ensuring success of a business. The works of researchers has shown that ethics helps in motivating the employees and guarantees that they stay in the organization for a long-time (Campbell, 2007). According to the research of Campbell (2007) Corporate Social Responsibility (CSR) has become an important part of the corporate governance of organizations as it is a key to sustainable business performance. The issue of corporate social responsibility is important because business enterprises are focusing on sustainable business practices and performing the social duties is one of the first steps in achieving the goal of sustainability. The concept of CSR is relatively new so the initial theories of management had not considered them. The increasing importance of CSR is a by-product of the globalization process (Campbell, 2007). Managers are now realizing that in order to compete with their rivals in the long run they have to invest their resources in the society. This is because society is an important external stakeholder for businesses. Empirical research has also established that the financial performance of a company can be improved by following CSR activities in an effective manner (Campbell, 2007). The concept of CSR is quite broad and can be broken down into a number of sub segments like economic aspects, legal aspects, ethical aspects and discretionary aspects. The first one relates to the nature of jobs, salaries and services. The second one relates to the aspect of compliance while the third aspect relates to the fair business practices and fourth is the aspect of philanthropy. The role of the management is extremely important in the implementation of the CSR activities. This brings one back to the principles of management (Campbell, 2007). However, the traditional literature of management excludes CSR for which there is a need to develop a new framework to incorporate this. Sustainability in business practices is also a new concern for the managers which has to be dealt effectively. The new theories of management have identified that the importance of sustainability to make any business venture successful. Empirical evidence suggests that sustainable business practices can provide financial benefits to an organization. Earning of trust as stakeholders trust is important for business success (Campbell, 2007). These new challenges show that the managers are facing quite different environment from the ones that has been described by the theories of management. Organizations have also gone through a number of changes characterized by lesser bureaucratic controls, decentralization and distribution of power. These changes suggest that new principles of management should be framed which should guide managers in running business. They also need to bring drastic transformation in themselves. The following section describes these changes under the theory of post-modernism. Post –Modernism to explain new shifts Post-Modern theories of management have evolved to overcome the shortcomings of the scientific and the classical organizational theories of management. Under postmodern approaches organizations are highly systematic, influenced by mass mediation, largely dependent on technology and demands speed and precision on the part of the individual workers (Clegg, 1990). The nature and range of these demands have challenged the very existence of the traditional management perspectives. In the scientific management perspective, the focus was on specialization of tasks and providing specialized training to the workers. On the other hand the modern organization theory that has been developed by Clegg (1990) has established that workers in an organization must be capable of performing multiple tasks and they should have the capability of learning continuously. The idea developed by Weber and his bureaucratic organization is a redundant theory according to proponents of post modernism. New organizations are successfully based on effective teamwork which does not require intervention on the part of the managers. The post modern literature also argues that the idea of the top-down management that has been described in scientific and classical organizational theories is rather invalid and successful organizations are now increasingly characterized by decentralization of power. The research of Eisenberg and Goodall (1993) is quite insightful in the theory of post-modern management principles. Their research had shown that there are five major principles of management which are decentralization of power, evolving market dynamics and the impacts it have on the organization, dissolution of hierarchies and difference in culture of people or ethnic diversity. These factors indicate that managers should learn to divide their power in the organization and help in the creation of self-managing teams which are highly efficient. New age business concepts like e-commerce and the infiltration of the web-based technology have increased the importance of the post-modern management literature which values precision and accuracy of collection of information and maximizing customer satisfaction (Eisenberg and Goodall, 1993). The involvement of stakeholders in the Web world has made it imperative for the business houses to become more transparent. The role of the external stakeholders was almost negligent during the times of scientific management theory and organizational control theory. The works of researchers had shown that every form of knowledge comprises subjective interpretations which in turn are influenced by social surroundings (Clegg, 1990). Proponents of post-modern theorists argue that that CSR can be viewed as a way of confrontation between competing discourses. The effects that an organization has on the society and physical environment are the main concern in the CSR activities. It has been established in postmodernism that value judgements are possible but it is not universally justifiable (Keenoy, Oswick and Grant, 1997). Postmodern theorists have also suggested that ethics are not grounded in predictable reality. Critics of postmodernism have also criticized the approach by arguing that it does not explain the role of business ethics fully (Keenoy, Oswick and Grant, 1997). It is now being argued that the rising number of corporate scandals in the current business scenario requires a transformation of the management culture as managers have to take a proactive role in implementing the business ethics. In this regard it is extremely important to define the role of the senior managers who takes major business decisions. Managers now have the additional role of communicating effectively with the employees and comprehending their problems in a better manner (Mintzberg, 2004). This is done in line with the employee empowerment where the mangers should be concerned about improving the employee engagement. Transparent communication with the managers is also one of the most important aspects that have been identified as a key managerial skill in the contemporary times. In this regard, the theory of management developed by Mintzberg (2004) is one of the most effective ones as it points out the characteristics that must be present in a modern day manager. Interpersonal skills, informational skills and role of decision-maker have been identified as they key features for managers to be successful in the present management era. Conclusion Management literature is a fast changing topic and different researchers have made multiple attempts to explain the chief role of the managers. This essay had begun with the role of the scientific management theory and the classical organizational theory which had been very popular in explaining the functioning of successful organization. Especially Fayol’s principles of management and Taylor’s management functions are still treated as starting point for successful business venture. However, with the change in the business scenario, the validity of these theories has reduced. Empirical verification of these theories have shown that though they were popular in the past but now they are unable to explain the managerial practices. Many organizations have abandoned the Fayol’s principles of management whereas others have found the manufacturing concept described by Taylor to be inapplicable. Bureaucracy has also turned out to be a redundant concept as most of the modern day organizations are based on decentralization of power. Globalization has posed new challenges to the business environment like evolution of internet technology and e-commerce platforms, focus on sustainability and ethical practices and corporate social responsibility to name a few. The challenges of globalization have made it critical to adopt a new framework to understand managerial practices. Postmodernism can be considered as an alternative paradigm to explain the managerial roles. Organizations have become far more flexible and they demand timey action on the part of the management for survival. This requires the managers to take a proactive role in management. Using the stance of postmodernism can help in incorporating new changes like development of e-commerce strategies, improvement in CSR and sustainable business practices. Therefore, postmodernism theories can be considered as a better guide for managerial practices in the era of globalization. Reference List Campbell, J.L., 2007. Why would corporations behave in socially responsible ways? An institutional theory of corporate social responsibility. Academy of Management Review, 32(3), pp.946-967. Clegg, S., 1990. Modern organizations: Organization studies in the postmodern world. Berlin: Sage. Du Gay, P., 2000. In praise of bureaucracy: Weber-organization-ethics. Berlin: Sage. Giannantonio, C.M. and Hurley-Hanson, A.E., 2011. Frederick Winslow Taylor: Reflections on the Relevance of The Principles of Scientific Management 100 Years Later. Journal of Business Management, pp.7-16. Keenoy, T., Oswick, C. and Grant, D., 1997. Organizational discourses: Text and context. Organization, 4(2), pp.147-157. Kraemer, K. L., Gibbs, J. and Dedrick, J., 2005. Impacts of globalization on e-commerce use and firm performance: a cross-country investigation. 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