Download Historical Developments to Management Approaches

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Historical Developments to Management Approaches
Main approaches to organisation, structure and management revolving around a
framework based on four main approaches:
1. Classical
2. Human Relations
3. Systems
4. Contingency
Classical
Emphasis on
purpose,
formal
structure,
hierarchy of
management
technical
requirements
and common
principles of
organisation.
-Scientific
management
. (Taylor)
-Bureacracy
(Weber)
Human
Relations
Attention to
social factors
at work,
groups,
leadership, the
informal
organisation
and behaviour
of people.
-Hawthorne
experiments.
-Neohuman
relations
(Maslow,
McGregor,
Herzberg)
Systems
The
integration
of the
classical and
human
relations
approaches.
Importance
of the sociotechnical
system. The
organisation
within its
external
environment.
-Interrelated
sub-systems.
-Teams
Contingency
No one best
design of
organisation.
Form of
structure,
management
and 'success’
of the
organisation
dependent
upon a range
of situational
variable.
-Each
organisation
is different.
-Simon d.m.
This framework shows an evolution of structural and management styles of organisations
in general.
Classical Era
Classical management theory is the collective term for a set of ideas which were
propounded by individuals who came from different backgrounds and different countries
over a period of about 30 years (1900 to mid-1930s)
Max Weber (1864-1920)
 German Sociologist
 Study of power and authority. Power def “the ability to get things done by threats of
force sanction” and authority def “managing to get things done because one’s orders
were seen by others as justified or legitimate”. (Buchanan & Huczynski:1997).
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1.
2.
3.
4.
5.
6.
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According to Weber, bureaucracy (def: “an organisational design characterised by a
specialisation of labour, a specific authority hierarchy, a formal set of rules and rigid
promotion and selection criteria” B&H) was the most efficient way of running large
organisations. The bureaucratic form of organisation as Weber saw it had the
following characteristics:
Job specialisation – jobs broken down into simple, routine and well defined tasks.
People should specialise and thereby learn to don one set of activities well. Work is
divided to that authority and responsibility are clearly defined.
Authority hierarchy – positions are organised in a clear chain of command hierarchy.
Each lower position is controlled and supervised by a higher one so workers clearly
know who they are responsible to.
Formal rules and regulations – to ensure uniformity and to guide the actions of
employees, managers must depend heavily on formal organisational rules that are set
down to monitor and control employee behaviour.
Impersonality – Rules and controls are applied uniformly, avoiding involvement of
personalities or the personal preferences of employees.
Formal selection – all organisational members are to be selected on the basis of
technical qualifications demonstrated by training, education or formal examination.
Career orientation – managers are professional officials rather than owners of the
units they manage. They work for fixed salaries and pursue their careers within the
organisation.
Formal organisation both impersonal and rational – standardisation.
Administrative Theory - Henri Fayol (1841-1925)
Administrative theory describes efforts to define the universal functions that managers
perform and principles that constitute good management practices. The major contributor
to administrative theory was a French industrialist named Henry Fayol.
 French mining engineer.
 Interested in methods, not personalities.
 Identified 14 principles of management. (see h/o from pg 585 of text book)
 Also identified six main functions that are performed in any organisation:
1. Technical (production, manufacturing)
2. Commercial (purchases, sales)
3. Financial (finding and controlling capital, using capital efficiently)
4. Security (protection of goods and persons against hazards, avoid strikes)
5. Accounting (stocktaking, balance sheets, accounting, costing)
6. Administration (Managerial activities – lecture on Role of the Manager next week)
Scientific Management – Fredrick Taylor (1856-1917)
Taylor was a pay clerk in Bethlehem steelworks in USA in the early 1900’s. He is known
as the ‘father of scientific management’. He believed in the best machine or tools for
every job and the best working method for each job. He believed in one best way to
perform a job. He noticed a lot of ‘soldiering’ and inefficiency among workers . He
started investigating the level of shovelling a man could do. The average man was found
to shovel 12.5 tonnes a day.
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Taylor conducted an experiment based on one worker (Henry Schmidt). He broke the job
down into various elements and timed each part. Taylor worked out the optimum weight
of steel to be lifted with each shovel (38lb per shovel). He designed a shovel more suited
to lifting larger loads. The first days experiment yielded 48 tonnes in comparison with the
previous average of 12.5 tonnes. Schmidt received an 60% pay increase for nearly a
300% increase in work output.
Taylor’s principles:
 The development of a true science for every persons job.
 The scientific selection, training and development of the workers.
 Co-operation of workers to ensure work is carried out in prescribed way.
 The division of work and responsibility between management and workers.
Criticisms: Work becomes boring.
 Fear of mass redundancies.
 Workers strike e.g. radical changes.
 Taylor picked the best workers for his experiments.
Basically what scientific management looks at is the most efficient way of carrying out a
single task. A good modern day example of scientific management is McDonalds, each
function has been analysed and the most efficient equipment used. This allows the
minimum labour per function.
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Human-Relations Approach
The essence of the human relations movement was the belief that the key to higher
productivity in organisations was increasing employee satisfaction. The Hawthorne
studies were the main influential element of the human relations era. These studies led to
much of the work we will examine under motivation theories (in particular the work of
Maslow and McGregor).
The Hawthorne Studies – Elton Mayo
The Hawthorn plant (of the Western Electric Company in Cicero, Chicago – American
subsidiary of AT&T: American Telephone and Telegraph Company) experiments were
carried out over six years (1924-1932) and human relation theories stem from these
experiments. Mayo led these experiments (along with Roethlisberger, Dickson, Homans,
Whitehead and Warner).



Professor George Elton Mayo
Australian academic.
Professor of Industrial research at Harvard Business School.
The experiments consisted of 4 stages:
1.




The Illumination experiments.
Carried out between 1924-1927.
Its aim was to investigate the effects of lighting on production.
An experimental and control group were observed over time with a decrease in light.
The light was decreased gradually for the experimental group until eventually the
group was working in the dark. The control group experienced no change.
The result was inconclusive, performance of both groups increased.
2. Relay Assembly Test Room experiments (1927-1933)
 Its aim was to look closer at the effect of physical conditions on work.
 Six workers were separated from other workers. There were thirteen test periods over
two years.
 The result was a consistent increase in productivity.
The conclusion drawn from these first two experiments became known as the Hawthorn
Effect i.e. the effect of being the focus of attention or receiving special treatment.
Production increased not as a result of the variables introduced but as a result of being
monitored, chosen as a special group.
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3. The Interview Program (1928-1930)
 The aim of the interview program was to gather information concerning workers
attitudes and feelings towards work.
 20,000 workers were interviewed in an informal manner.
 The result was the first ever documentation of workers attitudes and feelings towards
work and the effects of these on work.
 Discovery of informal groups with their own hierarchy and rules, within
organisations.
4. The Bank Wiring experiment (1931-1932)
 Its aim was to study the effects of group dynamics.
 Fourteen men who were formally organised into 3 subgroups of 3 + supervisor, then 2
inspectors between 3 groups - were observed over time.
 The result was the emergence of informal group structure with cliques and natural
leaders. Also there was the establishment of norms of behaviour.
 It was also found that the informal group had more effect on performance than
anything else.
Conclusions:
Workers must be recognised as members of groups.
Workers need to belong to a group and have status within it.
Informal groups exercise a strong influence over behaviour and attitudes of workers.
Social needs must be fulfilled in order to meet the organisations objectives.
“A satisfied worker is a productive worker”. Elton Mayo