The Geniuses of Modern Business - Case Study Example

Title: An analysis of 3 Management Theorists Student’s Name: Student Number: Group Name: Contents Introduction ……………………………………………………………………………………… 3 Biography of Chester Barnard …………………………………………………..………………. 3 Management Theory espoused by Chester Barnard ……………………..……………………… 5 Usefulness of the Theory ……………………………………………………..….……………… 6 Application of the theory today (2 examples) ………………………………..………………… 6 Biography of Andrew Carnegie …………………………………………………….…………… 7 Theory espoused by Andrew Carnegie ………………………………………………………….. 8 Usefulness of the Theory ………………………………………………………...……………… 9 Application of the theory today ………………………………………………...……………… 10 Biography of Mary Parker Follett ……………………………………………………………… 10 Theory espoused by Mary Parker Follett ………………………………………………………. 11 Usefulness of the Theory …………………………………………………….………………… 12 Application of the theory today ………………………………………………….……………. 12 Conclusion ……………………………………………………………………...……………… 13 Introduction Many years have passed with sweeping publication of the main management theorists coming alive and their application in the real world being experienced in the respective fields. In many ways, the theorists laid a strong foundation for Management Theory applicable in organizations as they exist today. Their influence on practitioners and theoreticians has been immense in the modern world, and they are valued highly in the management field. This paper is a critical review of three main management theorists including Chester Barnard, Andrew Carnegie and Mary Parker Follett. The paper outlines the Biography of the theorist, main theories as they were passed by the respective theorists, their usefulness and the application of the same theories in today’s organizations. The main direction of this article is kindling the interest of the reader by making a presentation of the main ideas, which are central to the three theorists arguments and establishing the relevance of these ideas for today’s managers. The paper purposes to link the ides to more recent views on leadership within organizations. It will also be making attempts of convincing the reader that the theorists’ ideas even having led to the development of numerous schools of thought; in the management and leadership field they need further study. Biography of Chester Barnard Chester Barnard (1886–1961) commonly referred to as Irving Barnard was a telecommunications executive. He is famed for being an author of the book “Functions of the Executive”, which happens to be one of the best management books of the 20th century (Gabor, 2000). In this book, Barnard makes a clear presentation of the theory of organization and outlines the functions of executives within given organizations (Williamson, 1995). In his younger age, Barnard used to work on a farm. It was during this period that he studied economics at Harvard University (Joseph, 2002). His main source of income in his early age was earned in tuning pianos, and he also operated a dance band. However, he experienced a challenge in his studies as Harvard denied him a BA (Scott, 1992). The denial was based purely on a technicality, but he was lucky that there were several other universities that offered to grant him honorary doctorates (Gabor, 2000). In his later years, Irving joined the American Telegraph Company which was also involved in Telephone (now named AT&T). This was early in 1909 and later in 1927; Barnard was elected president of a Telephone Company by the name New Jersey Bell. In the period when the world was experiencing the Great Depression, Barnard was famed to have successfully directed a relief system within the New Jersey state (Williamson, 1995). Later on, Irvin was elected and served as the United Service Organizations (USO) president which was in the period between 1942 and 1945 (Scott, 1992). Upon his retirement from business, Barnard served in the Rockefeller Foundation in the period 1948-52 where he also took the role of the president. He also happened to be the National Science Foundation chairman in the period 1952-54. Later on in the 1950s Barnard was listed among the first Society for General System’s members in conducting Research (Joseph, 2002). So many scholars have written about him noting that Barnard's teachings are primarily an exhibition of “sympathy” and “imagination (Williamson, 1995).” They hail him as a unique theorist whose works are diverse unlike other academic writings lacking in depth analysis on management. It is argued by many scholars that there is a correlation between the contradictions involved in Irvin’s childhood and his fertile imagination within his theory writings (Scott, 1992). In terms of his sympathy feelings particularly towards other people, the death of his mother while in childbirth all are known to contribute to his writings (Gabor, 2000). Barnard's integrity is clear and comes out in his writings particularly in theory description especially because the writings have words of encouragement which he combines with imagination and concern for other people to bring out words of inspiration. Management Theory espoused by Chester Barnard Barnard's theory of organization Management reveals his intimate interest in management. His theory evidently puts more emphasis on rational stewardship, competence, moral integrity, and professionalism (Joseph, 2002). His theory development is an indication of his ability to theory building and philosophy which shows his love of scholarship and the intimate desire to put theory to practice particularly in scientific foundations. Barnard presentation of the theory involves a systematic approach containing a psychological theory of behavior as well as motivation (Scott, 1992). His arguments base on the sociological theory of cooperation and also have fantastic elements of complex interdependencies. The ideology in the theory is based on a meritocracy (Gabor, 2000). Scholars argue that the uniqueness of Irvin’s contribution in theory stems from an ideal placement of the concepts of group processes, motivation and behavior into systems frameworks (Williamson, 1995). Barnard's in his book “Functions of the Executive” discusses the theory of organization. It has a strong base on several concepts including Bounded and Individual Rationality, Cooperation, Informal Organization and Formal Organization (Joseph, 2002). The theory also builds in principal dynamic concepts which are among others Communication, Free Will, Theory of Authority, Dynamic Equilibrium, The Decision Process, Moral Codes, Leadership, and Executive Responsibility. Usefulness of the Theory The theory as espoused by Chester Barnard hails as useful in developing an understanding of the management of an organization. It generates knowledge on fundamental elements of management, which applies well in the motivation of subjects within the organization and in increasing the productivity within an organization (Scott, 1992). Barnard's theory is also excellent as it resonates well with current students at all levels in the management education system. The theory makes numerous contributions to the “science of organization” a particularly critical area of management (Joseph, 2002). Barnard's theory is also excellent as it enriches the reader particularly when read for practical purpose and it delivers ones expectations when trying to understand the science of management (Gabor, 2000). On the same note, the theory discussion derives as aesthetic value in reading the same. The aesthetic value is celebrated in explaining the intensity of the responses of students to his work (Williamson, 1995). Barnard's theory of organization also offers an intense, coherent and structured art form which happens to be ideal in the practice of management, in a diverse organization. Application of the theory today Barnard is known to have been an academician. His theory of organization management and the related discussions were put together conscientiously from many years of organizational experience (Joseph, 2002). Therefore, the theory and it concepts happens to be excellent within an organization when applied appropriately. His theory discovery happens to be unique among management theories of the twentieth century (Gabor, 2000). However, it has been revealed that, during the last decade, the stature of Barnard’s work in the realm of management has waned gradually. Nevertheless, his theory has been applicable in the Doctoral curriculum and in the management studies (Scott, 1992). More applications of this theory have been in management researches by various scholars who try explaining management and organization operations in the surveys, case studies and researches (Joseph, 2002). It has been a veritable theory in development of immense literature on management issues with the likes of “Acceptance Theory of Authority” coming alive in the field of organization management (Gabor, 2000). The theory has been applied by managers in today’s operations linking the same to the conceptualization of managers. They use the same to establish the need for achievement (Power managers), need for affiliation (Affiliative managers), or need for influence (Institutional managers) (Joseph, 2002). Biography of Andrew Carnegie Andrew Carnegie a theorist was born in Dunfermline on 25 November 1835 a place in Scotland (David, 2006). He was born in a poor family with his life contained in a typical weaver's cottage that had only one main room shared with the weaver's family. Andrew was named after his grandfather and lived with the family for the best part of his childhood (Harold, 2000). He was introduced to writing by George Lauder, his uncle whom he normally referred to as "Dod (Morris, 2005)." His first encounters with writings were those of Robert Burns, William Wallace, Robert the Bruce, and Rob Roy (David, 2006). He had hard times in his life while practicing as a handloom weaver and faced starvation for a long time. This led Andrew to go searching for a Job with his first job at 13 years of age in 1848 (David, 2006). He was working as a bobbin boy, where he changed spools of thread working in a cotton mill. His earnings ranged from $1.20 – 2 per week. This was what he used to support his family with his father and mother helping a little for their daily survival. Andrew Carnegie's career in philanthropy began in 1870 and was more involved in theory development after 1890. Andrew Carnegie is known best for his gifts that he gave to the society including the public library buildings (Morris, 2005). His first gift was to Dunfermline in 1881, and later followed other exciting gifts that he is known to have given to over 2,509 communities in the entire region of English-speaking world (Maury, 2004). He continued his career in business with his literary intentions being fulfilled in his life as a business person (David, 2006). He became an established writer after befriending Matthew Arnold a writer and philosopher Spencer, therefore, came alive in the list of most notable writers and theorists. Theory espoused by Andrew Carnegie Andrew Carnegie developed a theoretical concept “The Gospel of Wealth (David, 2006).” The concept was Carnegie’s attempt to infuse a new sense of philanthropy in the business world, particularly targeting the self-made millionaires categorized among the upper class. His main argument in the theoretical concept was geared towards his belief that the wealthy in a particular society should use their wealth and offer immense help to enrich the society (David, 2006). He also espoused in his argument that the rich are merely “trustees” of own wealth arguing that they are mandate and have a moral obligation of making sure that they distribute it in ways which are geared towards promoting the happiness and welfare of the common man (Harold, 2000). By the time of his death later in 1919 Andrew had given away almost everything of his fortune, exactly $350,695,653 as estimated in his works and this was what Carnegie’s theoretical concept espoused (David, 2006). There was however still about $30,000,000 that remained in his account when he died all of which was earmarked for numerous foundations, as well as charities (Morris, 2005). In his entire life, Andrew Carnegie hailed as a shrewd businessman, but what he did was to spend his last years in life, paying back to the society what he had taken from it. This was the ideology behind Andrew Carnegie’s theoretical perspective (Maury, 2004). Usefulness of the Theory The theory was particularly useful in establishing laissez-faire system within a society. The central thesis of Andrew was particularly focused on the dangers associated with wealthy entrepreneurs passing own fortune to their children, who otherwise did not qualify to handle it (Harold, 2000). Andrew was of the view that this wealth would only be wasted, and this would not develop the society (Harold, 2000). The application of his perspective was meant towards establishing the common good of everyone (David, 2006). His argument was useful in preventing the wastage of money and resources. It was a theoretical perspective influential in controlling the squandering of money and preventing inefficiency in resource allocation (Morris, 2005). Carnegie’s argument was that such money and resource would be put in use towards the public good. He was also of the view that capitalism could cause considerable hurt to some people, therefore, helped in controlling the negatives emanating from the pure practice of the capitalistic system (Maury, 2004). This was useful as it controlled the system and helped in preventing the high rates of poverty emanating from the practice of the capitalistic system (Maury, 2004). Application of the theory today The theoretical concept “The Gospel of Wealth” can be of considerable use in the contemporary world where competition is on a high. It is essential in abolishing monopoly in the diverse society and establishing equity in the business world (Maury, 2004). For instance in the world of investment where the mighty states have monopolized, there is a need to accommodate small investors. It would of extensive use in establishing an equal opportunity for investment in the contemporary world, therefore, necessitating growth in the field of investment (Morris, 2005). In a world, where diversities are clear, and the wealth Gap being exceedingly evident across communities this is the best perspective to apply to apply (Harold, 2000). Particularly with regard to the industrialized and wealthy countries, they have an obligation under this concept to distribute wealth to the developing and poor countries across the globe (Morris, 2005). This would necessitate the development across poor nations and maintain global equity in wealth distribution. Establishing a laissez-faire system in the contemporary world is what Andrew’s work would necessitate in today’s world. Biography of Mary Parker Follett Mary Parker Follett was born in Massachusetts. She spent much of her childhood life there but later in September 1885 she was enrolled in Ticknor's Society where she was to Encourage Studies at Home (Art, 1996). In 1898, Mary graduated with honors from Radcliffe College. However, she was denied a doctorate which she wanted to pursue at Harvard, and the argument was that she was a woman (Joan, 2003). However, this did not stop her as she also worked as a social worker, pioneer and management consultant in the organizational theory fields. She had extensive interests in organizational behavior something that propelled her to developing different perspectives in the same field authored numerous books on the same line of argument (Graham, 1995). She also did lots of essays, speeches and articles on democracy, political philosophy, human relations, psychology, conflict resolution and organizational behavior. She combined efforts with Lillian who was also an ardent management guru in those early days and did lots of works on classical management theory (Graham, 1995). Mary is known to undervalue over managing employees, whom she referred as “bossism” and commonly known by many as “mother of Scientific Management (Art, 1996)”. As a result, she happens to be one of the first women to deliver a speech at the London School of Economics. In his speech, she addressed cutting-edge management issues. She also worked for President Theodore Roosevelt with her roles being for a personal consultant for the non-governmental, not-for-profit, and voluntary organizations. Being a management theorist, Parker Follett is known to pioneer the knowledge of lateral processes that feature within the hierarchical organizations (Graham, 1995). Theory espoused by Mary Parker Follett Mary as a management theorist developed key concepts in the same field (Joan, 2003). Some of the underpinning concepts in her espoused philosophy include interrelatedness within an organization which she proposed a coactive dimension and opposed the coercive version. The other concept is power within the organization. Her theory supported the concept of 'power-with' and opposed 'power-over' people (Montana, 2008). In this case, she was of the view that any appreciable power is best gained through the involvement of people with a bottom-up approach. She also went for the concept of a community-based approach where she led an argument that leaders develop within a community through interactions arguing that the leaders play their role with guidance coming from the group (Art, 1996). From the same arguments, she espoused that fluid leadership was the most valued where followers and leaders in a particular environment are in a strong relationship supporting the informal leadership as the best within a workplace. Usefulness of the Theory It helps in establishing the rightful way of establishing power in organization the rightful way. In her essay on "Power," Mary coined the words "power-with" and "power-over" which would help in differentiating coercive power from that gained through participative decision-making. His theory is celebrated in establishing the "power-with (Joan, 2003)" concept in a given organization to ensure greater and better relations within the work place. It also helps discourage "power-over" which many organizations have been using, therefore, ensuring that there are superb and better leadership styles within a work place (Montana, 2008). It is from her views that the leadership within an organization would learn the numerous ways of gaining appropriate power. It helps in development of a better working environment within an organization and also establishing appropriate leadership skills (Art, 1996). It helps in establishing the relevance of informal processes within a diversified organization, and the implementation of the "authority of expertise (Art, 1996)" concept that would help in the modification of the typology of authority within an organization. Application of the theory today Mary Parker Follett theory and works occupy quite a significant place in the thinking and practice development around informal education (Graham, 1995). Her contribution to the modern day is seen in three arenas (Art, 1996). First, her involvement in community centers and advocacy of the same in his discussions has brought them in the frontline of significant educational and social institutions. The concepts developed by her are being used today to support these organizations and in their maintenance (Montana, 2008). The theory he developed relating to notions of the community provided a key element in the advancement of the team work concept in today’s works by respective scholars. For instance, her theory espousing that democracy works well only when individuals united is a terrific concept as it is used within the community practices (Art, 1996). Conclusion Major publications have been done by theorists and the ideas espoused applied in the real world, in the respective fields. In many ways, the theorists laid a strong foundation for Theory applicable in organizations as they exist today. Their influence theoreticians have been immense in the modern world, and they are valued highly in the management field. This paper has been a critical review of three main theorists including Chester Barnard, Andrew Carnegie and Mary Parker Follett. The paper has established the Biography of the theorist and delivered an understanding of where these theorists come from. It has also developed main theories and concepts as they were passed by the respective theorists with a discussion on their usefulness and the application of the same theories in today’s organizations. It has been an article with intent of targeting the interest of the reader by making a presentation of the main ideas, which are central to the three theorists arguments and establishing the relevance of these ideas for today’s managers. References Art, K. (1996). The Age of Heretics: Heroes, Outlaws, and the Forerunners of Corporate Change. New York: Doubleday. David, N. (2006). Andrew Carnegie. New York: The Penguin Press, p. 54–59. Gabor, A. (2000). The Capitalist Philosophers: The Geniuses of Modern Business: Their Lives, Times, and Ideas. Random House: New York, 2000. Graham, P. (1995). Mary Parker Follett: Prophet of Management. Washington: Beard Books. Harold, L. (2000). Andrew Carnegie and the rise of big business. New York: Addison-Wesley Educational Publishers. Joan, C. (2003). Mary P. Follett: Creating Democracy, Transforming Management. New Haven: Yale University Press, p. 34. Joseph, T. (2002). The Relevance of Chester I. Barnard's Teachings to Contemporary Management Education: Communicating the Aesthetics of Management. International Journal of Organizational Theory & Behavior, 5 (1&2), 159 – 172. Maury, K. (2004). The Change Makers. London: Macmillan Publishers, p. 57. Montana, P. (2008). Management. New York: Barron’s, p. 18 Morris, R. (2005). The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Super economy. New York: Times Books. Scott, W.G. (1992). Chester I. Barnard and the Guardians of the Managerial State. Lawrence, Kansas: University of Kansas Press. Williamson, O.E. (1995). Chester Barnard and the Incipient Science of Organization. In Williamson, O.E., Ed. Organization Theory: From Chester Barnard to the Present and Beyond. New York: Oxford University Press. Read More