EvolutionEvolutionof of

Management Management ThoughtThought

Chapter 2Chapter 2

Evolution of

Management thought

Early Approach to Management(1771-1924)

*Robert Owen: (1771-1858) Human Resource Management Pioneer

*Charles Babbage: (1792-1871)Inventor and Management Scientist

Andrew Ure: (1778-1857)& Charles Dupin: (1784-1873)

Management Education PioneersHenry Robinson Towne: (1844-1924)

“Engineer as an Economist”

Evolution of

Management thought

Robert Owen (1771-1858)

Charles Babbage: (1792-1871)

Andrew Ure: (1778-1857)

Charles Dupin: (1784-1873)

Henry Robinson Towne: (1844-1924)

Evolution of

Management thought

Classical Approach-Scientific Management*Frederick Winslow Taylor*Frank & Lillian Gilbreth*Henry Laurence Gantt-Administrative Theory*Henri Fayol:(1841-1925)-Bureaucratic Management

Classical Approach (1856-1920)

Frank Gilbreth (1868-1924)

Henry Laurence Gantt (1861-1919)

Administrative Theory

Bureaucratic Management

Evolution of

Management thought

Behavioral ApproachMary Parker Follet:(1868-1933)Focusing on Group Influences

Elton Mayo:(1880-1949) Focusing on Human RelationsAbraham Maslow:(1908-1970)

Focusing on Human NeedsDouglas McGregor:(1906-1964)Traditional Assumption about

EmployeesChris Argyris: Matching Human& Organizational Development

Mary Parker Follet

Behavioral Approach

Elton Mayo

Abraham Maslow

Douglas McGregor

Chris Argyris

Evolution of

Management thought

Quantitative Approach:-Management Science-Operations Management-Management Information systems

Management Science

Operations Management

Management Information Systems

Quantitative Approach - Overview

Evolution of

Management thought

ModernApproach

toManagement:

-Systems theory-Contingency

theory

Evolution of

Management thought

Emerging Approaches inManagement

Thought:-Theory Z-Quality

Management

Early Approach to Management(1771-1924)

*Robert Owen: (1771-1858) Human Resource Management Pioneer

*Charles Babbage: (1792-1871)Inventor and Management Scientist

Andrew Ure: (1778-1857)& Charles Dupin: (1784-1873)

Management Education PioneersHenry Robinson Towne: (1844-1924)

“Engineer as an Economist”

Evolution of

Management thought

Emerging Approaches inManagement

Thought:-Theory Z-Quality

Management

ModernApproach

toManagement:

-Systems theory-Contingency

theory

Quantitative Approach:-Management Science-Operations Management-Management Information systems

Classical Approach-Scientific Management*Frederick Winslow Taylor*Frank & Lillian Gilbreth*Henry Laurence Gantt-Administrative Theory*Henri Fayol:(1841-1925)-Bureaucratic Management

Behavioral ApproachMary Parker Follet:(1868-1933)Focusing on Group Influences

Elton Mayo:(1880-1949) Focusing on Human RelationsAbraham Maslow:(1908-1970)

Focusing on Human NeedsDouglas McGregor:(1906-1964)Traditional Assumption about

EmployeesChris Argyris: Matching Human& Organizational Development

Early Approaches to Early Approaches to Management(1771-1921)Management(1771-1921)

The The Industrial RevolutionIndustrial Revolution, which began in , which began in Europe in the mid-1700s, was the Europe in the mid-1700s, was the starting starting point for the development of point for the development of management concepts and theoriesmanagement concepts and theories

The rapid growth in the The rapid growth in the number of number of factoriesfactories during this period and the during this period and the need need to coordinateto coordinate the the efforts of large number efforts of large number of peopleof people in the production process in the production process necessitated the development of necessitated the development of management theories and principlesmanagement theories and principles

Slide 3Slide 3

Robert Owen (1771-1858)Robert Owen (1771-1858)

Human Resource Management Human Resource Management Pioneer Pioneer Mary Parker Follet:(1868-1933)Mary Parker Follet:(1868-1933)

A successful British A successful British entrepreneurentrepreneur in the early 19 in the early 19thth centurycenturyHe was one of the earliest management thinkers to He was one of the earliest management thinkers to realize the realize the significancesignificance of human resources of human resourcesHe believed that He believed that workers’ performanceworkers’ performance was influenced was influenced by the by the environment environment in which they workedin which they workedHe introduced a standard working day of He introduced a standard working day of 10½10½ hours hours and and refused to employ children under the age of tenrefused to employ children under the age of ten

Slide 3Slide 3

Charles Babbage: (1792-1871)Charles Babbage: (1792-1871)

Inventor Inventor and and ManagementManagement Scientist Scientist

British professor of Mathematics is widely British professor of Mathematics is widely known as the “known as the “father of modern father of modern computing”. computing”.

Mathematics professor publicly supported Mathematics professor publicly supported the idea of the idea of division of labordivision of labor

He was impressed by the He was impressed by the work work specialization (specialization (the degree to which work the degree to which work is divided into various is divided into various taskstasks))

Charles Babbage: (contd)Charles Babbage: (contd)The management scientist believed that The management scientist believed that each each factory operation should be factory operation should be thoroughly thoroughly understood so that the necessary skill involved understood so that the necessary skill involved in each operation could be in each operation could be isolatedisolated

EachEach operation could then be trained in operation could then be trained in one one specific skill and made responsible specific skill and made responsible only only for that for that part of the operation part of the operation

Babbage felt that Babbage felt that work specializationwork specialization would would reducereduce training time and training time and improveimprove (through (through constant repetition of each operation) the constant repetition of each operation) the skillsskills and and efficiencyefficiency of workers of workers Slide 3Slide 3

Andrew Ure: (1778-1857)British British academicianacademician who taught at who taught at Glasgow University, published the Glasgow University, published the philosophy of Manufacturingphilosophy of ManufacturingPhilosophy of Manufacturing Philosophy of Manufacturing explainsexplains the the various principles and concepts of various principles and concepts of manufacturingmanufacturingIt is in 1771 the wheel was invented and It is in 1771 the wheel was invented and an academician (an art / science teacher-an academician (an art / science teacher-professor) is talking of production or professor) is talking of production or manufacturingmanufacturing (to produce goods in large (to produce goods in large numbers, usually in a factory using numbers, usually in a factory using machinesmachines Slide 3Slide 3

Charles Dupin: (1784-1873)

A French Engineer –an early proponent of A French Engineer –an early proponent of the study of managementthe study of management

In In 18191819, Dupin was appointed as a , Dupin was appointed as a management professor in Paris, which management professor in Paris, which marked the beginning of an illustrious marked the beginning of an illustrious careercareerHis writings, well-known throughout His writings, well-known throughout France, may have influenced France, may have influenced Henry Henry Fayol’sFayol’s contributions to the theory of contributions to the theory of managementmanagement Slide 3Slide 3

Henry Robinson Towne: (1844-1924)Henry R Towne, President of the Yale and Towne manufacturing company and a mechanical engineer, realized that good business skills were essential for running a businessHe emphasized the need to consider management as a separate field of systematic study on the same level as engineeringIn the paper, "The Engineer as an Economist,”presented in 1886,

Slide 3Slide 3

Early Approaches to ManagementEarly Approaches to Management

The early pioneers (The early pioneers (preclassicalpreclassical theorist): theorist):– generally tried to find solution to generally tried to find solution to

contemporarycontemporary (of yester years) managerial (of yester years) managerial problemsproblems

– with their technical backgrounds with their technical backgrounds did notdid not regard management as a separate field of regard management as a separate field of study study Slide 4Slide 4

– Ideas did lay the foundation for the Ideas did lay the foundation for the management theories (a theory is a management theories (a theory is a conceptual framework for organizing conceptual framework for organizing knowledge that provides a knowledge that provides a blueprintblueprint for for various courses of action) of the 1900svarious courses of action) of the 1900s

Classical Approach (1856-1920)Classical Approach (1856-1920)Classical theorists formulated principles Classical theorists formulated principles for for setting upsetting up and managing and managing organizations organizations These views are labeled “ classical” These views are labeled “ classical” because they form the because they form the foundationfoundation for the for the field of management thoughtfield of management thoughtIn this approach we have In this approach we have threethree schools of schools of thought:thought:

ScientificScientific Management ManagementAdministrative Administrative theorytheoryBureaucraticBureaucratic management management

Scientific Management (1856-1919)Scientific Management (1856-1919)Scientific Management was defined as that kind Scientific Management was defined as that kind of management which of management which conductsconducts a business or a business or affairs by:affairs by:

FactsFactsTruths gained through systematic observationTruths gained through systematic observationExperimentExperimentReasoningReasoning

In other words, it is a scientific study of In other words, it is a scientific study of work work methodsmethods to improve the efficiency of the to improve the efficiency of the workersworkersThe major contributors to the The major contributors to the threethree schools of schools of thought- thought- scientific management, administrative scientific management, administrative theory and bureaucratic management-theory and bureaucratic management- are are Frederick W Taylor, Henry Fayol and Max Weber Frederick W Taylor, Henry Fayol and Max Weber respectivelyrespectively

Frederick Winslow Taylor (1856-1915)Frederick Winslow Taylor took up Henry Towne’s challenge to develop principles of scientific managementTaylor, considered “father of scientific management”, wrote The principles of Scientific Management in 1911An engineer and inventor, Taylor first began to experiment with new managerial concepts in 1878 while employed at the Midvale Steel Co. At Midvale, his rise from laborer to chief engineer with in 6 years gave him the opportunity to tackle a grave issue faced by the organization-the soldering problem

SoldieringSoldieringRefers to the practice of employees Refers to the practice of employees deliberatelydeliberately working at a pace working at a pace slowerslower than their capabilitiesthan their capabilities((whywhy) Workers indulge in soldiering () Workers indulge in soldiering (??) for ) for the following the following threethree main reasons: main reasons:

Workers feared that if Workers feared that if they increasedthey increased their their productivity, productivity, other workersother workers would lose their jobs would lose their jobsFaulty wageFaulty wage systems employed by the systems employed by the organization encouraged them to work at a slow organization encouraged them to work at a slow pacepaceOutdated methodsOutdated methods of working handed down from of working handed down from generation to generation led to a great deal of generation to generation led to a great deal of wasted effortswasted efforts

Scientific MethodsScientific Methods

The scientific management approach involved The scientific management approach involved using using scientific methodsscientific methods to determine to determine

How a task has to be done instead of depending on the How a task has to be done instead of depending on the previousprevious experience of the concerned worker experience of the concerned worker

In short, scientific management as per Taylor:In short, scientific management as per Taylor:NeedNeed for developing a scientific way of performing each job for developing a scientific way of performing each job

Training and preparing workersTraining and preparing workers to perform that particular to perform that particular job job

Establishing harmonious relationsEstablishing harmonious relations between management between management and workers so that the job is performed in the desired wayand workers so that the job is performed in the desired way

Then how to do it?Then how to do it?Piece –rate incentive systemPiece –rate incentive system::– Under this system:Under this system:

A worker who met the A worker who met the established standardsestablished standards of performance of performance would earn the would earn the basicbasic wage rate set by management wage rate set by managementIf the worker’s output If the worker’s output exceededexceeded the set target, his wages the set target, his wages would would increaseincrease proportionately proportionately

– The The aimaim of this system was to of this system was to rewardreward the worker who the worker who produced the produced the maximummaximum output output

Time-and-motion study:Time-and-motion study:– In a “time –and-motion” study, jobs are broken down In a “time –and-motion” study, jobs are broken down

into various into various small taskssmall tasks or or motionsmotions and and unnecessary unnecessary motions are motions are removedremoved to find out the best way of to find out the best way of doing a jobdoing a job

– The The objectiveobjective of a time-and-motion analysis is to of a time-and-motion analysis is to ascertain a simpler, easier and better way of ascertain a simpler, easier and better way of performing a work or job performing a work or job Slide 4Slide 4

Frank Gilbreth (1868-1924)Frank Gilbreth is considered the “father of motion study.”Motion study involves finding out the best sequence and minimum number of motions needed to complete a taskFrank Gilbreth also developed the micro-motion study:– A motion picture camera and a clock marked off in

hundredths of seconds was used to study motions made by worker as they performed their tasks

– He is known for his experiments in reducing the number of motions in bricklaying

Lillian Gilbreth (1878-1972)She was associated with the She was associated with the researchresearch pertaining to motion studiespertaining to motion studiesFrank and Lillian Gilbreth were mainly Frank and Lillian Gilbreth were mainly involved in exploring new ways for involved in exploring new ways for eliminating eliminating unnecessary motionsunnecessary motions and and reducing work reducing work fatiguefatigueLillian had great interest in the human Lillian had great interest in the human implication of scientific management and implication of scientific management and focused her attention on designing focused her attention on designing methods for improving the methods for improving the efficiency of efficiency of workers workers Slide 4Slide 4

Henry Laurence Gantt (1861-1919)

Henry Laurence Gantt was a close associate of Taylor at Midvale and Bethlehem steelHe is probably best remembered for his work on:

The task-and-bonus (incentive plan) systemThe Gantt chart

Gantt’s incentive planGantt’s incentive planUnder Gantt’s incentive plan:Under Gantt’s incentive plan:– If the If the workerworker completed the work fast, i.e. in completed the work fast, i.e. in

less than the standard time, he received a less than the standard time, he received a bonus.bonus.

– He also introduced an incentive plan for He also introduced an incentive plan for foremanforeman, who would be paid a bonus for every , who would be paid a bonus for every worker who reached the daily standardworker who reached the daily standard

– If If all the workersall the workers under a foreman reached the under a foreman reached the daily standard, he would receive an daily standard, he would receive an extraextra bonusbonus

Gantt felt that this system would Gantt felt that this system would motivatemotivate foreman to foreman to train worker to perform their tasks efficientlytrain worker to perform their tasks efficiently

Gantt ChartGantt ChartA simple chart that A simple chart that compares compares actual and actual and planned performanceplanned performanceThe Gantt chart was the first simple The Gantt chart was the first simple visual visual device device to maintain production controlto maintain production controlThe chart indicates the The chart indicates the progress progress of production of production in terms of time rather than quantityin terms of time rather than quantityAlong the Along the horizontal axishorizontal axis of the chart, time, of the chart, time, work scheduled and work completed are shownwork scheduled and work completed are shownThe The vertical axisvertical axis identifies the individuals and identifies the individuals and machines assigned to these work schedulesmachines assigned to these work schedulesThe Gantt chart is still The Gantt chart is still usedused today by many today by many organizationsorganizations

Limitations of scientific managementLimitations of scientific managementscientific management revolve round scientific management revolve round problems at the problems at the operational operational (production) (production) level and do not focus on the management level and do not focus on the management of an organization from a of an organization from a manager’s point manager’s point of viewof viewPeople were “rational” and were People were “rational” and were motivated primarily by the desire for motivated primarily by the desire for material material (economic and physical needs) (economic and physical needs) gain gain whereas people were also interested whereas people were also interested in other needs (in other needs (social needssocial needs))Scientific management theorists also Scientific management theorists also ignored the ignored the human desirehuman desire for job for job satisfaction satisfaction Slide 4Slide 4

Administrative Theory

Scientific management was developed Scientific management was developed basically for getting basically for getting more more from from workersworkers whereas another classical theory – the whereas another classical theory – the administrative management theory – administrative management theory – focused on principles that could be used focused on principles that could be used by by managersmanagers to coordinate the to coordinate the internal internal activitiesactivities of organizations of organizations

The most The most prominent prominent of the administrative of the administrative theorists was theorists was Henri FayolHenri Fayol

Henri Fayol:(1841-1925)French industrialistFrench industrialist Henri Fayol, a prominent European Henri Fayol, a prominent European management theorist, developed a theory of management theorist, developed a theory of management.management.Fayol believed that satisfactory results were Fayol believed that satisfactory results were inevitable:inevitable:

with with scientificscientific forecasting forecasting Proper methods of managementProper methods of management

He was not known in America till his most important He was not known in America till his most important work, work, General and Industrial ManagementGeneral and Industrial Management, was , was translated into English in1949translated into English in1949According to Fayol, the business According to Fayol, the business operationsoperations of an of an organization could be divided into organization could be divided into sixsix activities activities

TechnicalTechnicalCommercialCommercialFinancialFinancialSecuritySecurityAccountingAccountingManagerialManagerial

Henri Fayol’s Managerial ActivityHenri Fayol’s Managerial Activity

Fayol focused on the Fayol focused on the last activitylast activity::Managerial ActivityManagerial Activity

Within this, he identified Within this, he identified five five major major functions:functions:– Planning Planning – OrganizingOrganizing– CommandingCommanding– CoordinatingCoordinating– Controlling Controlling

Fourteen Principles of ManagementFourteen Principles of Management

1. 1. Division of workDivision of work::– Work specialization results in Work specialization results in improvingimproving efficiency of efficiency of

operations The concept of division of work can be operations The concept of division of work can be applied to applied to both both managerial and managerial and technicaltechnical functions functions

2. 2. Authority and responsibilityAuthority and responsibility::– Authority is defined as “the Authority is defined as “the right right to give orders and to give orders and

the power to the power to exact exact obedience.”obedience.”– Authority can be:Authority can be:

FormalFormal-derived from one’s official position-derived from one’s official position

Personal-Personal-derived from factors like:derived from factors like:– IntelligenceIntelligence– experienceexperience

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

3. 3. DisciplineDiscipline::– Discipline is Discipline is vitalvital for running an organization for running an organization

smoothlysmoothly– It involves:It involves:

ObedienceObedience to authority to authorityAdherenceAdherence to rules to rulesRespectRespect for superiors for superiorsDedicationDedication to one’s job to one’s job

4. 4. Unity of commandUnity of command::– Each employee should Each employee should receivereceive orders or orders or

instructions from instructions from oneone superior only superior only

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

5. 5. Unity of directionUnity of direction::– Activities should be organized in such a way Activities should be organized in such a way

that they all come under that they all come under one planone plan and are and are supervised by only supervised by only one person one person

6.6. Subordination of the individual interest Subordination of the individual interest to the general interest: to the general interest:

– Individual interests should not take (over Individual interests should not take (over take) precedence over the goals of the take) precedence over the goals of the organizationorganization

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

7.7. Remuneration Remuneration::– The compensation paid to employee should be The compensation paid to employee should be fairfair

(reasonable) and based on factors like:(reasonable) and based on factors like:Business conditionBusiness condition

CostCost of living of living

ProductivityProductivity of employees and the of employees and the ability ability of the firm to payof the firm to pay

8.8. Centralization Centralization::– Depending on the situation, an organization should Depending on the situation, an organization should

adopt a centralized or decentralized approach to adopt a centralized or decentralized approach to make make optimumoptimum use of its personnel use of its personnel

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

9. 9. Scalar ChainScalar Chain::– This refers to the This refers to the chain of authoritychain of authority that extends that extends

from the from the top to the bottomtop to the bottom of an organization of an organization– The scalar chain defines the The scalar chain defines the communication pathcommunication path in in

an organizationan organization

10. Order:10. Order:– This refers to This refers to bothboth material and social order in material and social order in

organizationsorganizationsMaterial orderMaterial order indicates that everything is kept in the right indicates that everything is kept in the right place to facilitate the smooth coordination of work activitiesplace to facilitate the smooth coordination of work activities

Social orderSocial order implies that the right person is placed in the implies that the right person is placed in the right jobright job

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

11. 11. EquityEquity::– All employees should be All employees should be treatedtreated fairly fairly– A manager should treat all employees in the A manager should treat all employees in the

same same manner without prejudicemanner without prejudice

12. 12. Stability of tenure of personnelStability of tenure of personnel::– A high labor turnover should be A high labor turnover should be preventedprevented

and managers should and managers should motivatemotivate their their employees to do a better jobemployees to do a better job

Fourteen Principles of Management (contd)Fourteen Principles of Management (contd)

13. 13. InitiativeInitiative::– Employees should be Employees should be encouragedencouraged to to

give suggestions and develop give suggestions and develop newnew and and better work practicebetter work practice

14. 14. Espirit de corpsEspirit de corps::– This means “This means “a sense of uniona sense of union.”.”– Management must Management must inculcate inculcate a team a team

spirit in its employeesspirit in its employees Slide 4Slide 4

Bureaucratic Management

Bureaucratic management, one of the Bureaucratic management, one of the schools of classical management, schools of classical management, emphasizes (importance) the emphasizes (importance) the needneed for for organizations to function on a organizations to function on a rational rational (showing clear thoughts or reasons) basis(showing clear thoughts or reasons) basis

Weber (1864-1920):Weber (1864-1920):

A contemporary (lived in the same A contemporary (lived in the same period) of Fayol, was one of the major period) of Fayol, was one of the major contributors to this school of thoughtcontributors to this school of thought

Weber’s observationWeber’s observation

He observed that He observed that nepotismnepotism (hiring of relatives (hiring of relatives regardless of their competence) was prevalent regardless of their competence) was prevalent in most organization.in most organization.

Weber felt that nepotism was grossly Weber felt that nepotism was grossly unjustunjust and and hinderedhindered the progress of individuals. the progress of individuals.

Therefore, he Therefore, he identifiedidentified the characteristics of an the characteristics of an ideal bureaucracy to show how large ideal bureaucracy to show how large organizations should be runorganizations should be run

What is bureaucracy?What is bureaucracy?The term “bureaucracy” (derived from the German The term “bureaucracy” (derived from the German buroburo. .

meaning meaning officeoffice) referred to organizations that operated on ) referred to organizations that operated on a rational basisa rational basis

According to Weber, “a bureaucracy is a According to Weber, “a bureaucracy is a highly highly structured, formalized, structured, formalized, andand impersonal organization impersonal organization.”.”

In other words, it is a formal organizations structure with In other words, it is a formal organizations structure with a a set of rules and regulationsset of rules and regulations

These characteristics would exist to a greater degree in These characteristics would exist to a greater degree in “ideal” organizations and to a lesser degree in other, less “ideal” organizations and to a lesser degree in other, less perfectperfect organization organization

These type of organization help bring in These type of organization help bring in clarityclarity and and remove remove ineffectiveness ineffectiveness

Limitations of Classical approachLimitations of Classical approachClassical theorists ignored important aspect of Classical theorists ignored important aspect of organizational organizational behavior behavior (action)(action)They did They did notnot deal with the problem of: deal with the problem of:

LeadershipLeadershipMotivationMotivationPower or informal relationsPower or informal relations

Max Weber’s concept of bureaucracy is Max Weber’s concept of bureaucracy is notnot as as popularpopular todaytoday as it was when it was first proposed as it was when it was first proposedThe principal characteristics of bureaucracy The principal characteristics of bureaucracy destroy destroy individual individual creativitycreativity and the and the flexibilityflexibility to respond to to respond to complex changes in the global environmentcomplex changes in the global environmentSome of the managerial principles (order, equity) Some of the managerial principles (order, equity) propounded by the classical theorists were propounded by the classical theorists were not not universally applicable to today’s complex organizations universally applicable to today’s complex organizations Slide 4Slide 4

Behavioral ApproachBehavioral ApproachThe behavioral school of management emphasized what the classical theorists ignored –the human elementWhile classical theorists viewed the organization from a production point of view, the behavioral theorists viewed it from the individuals point of viewThe behavioral approach to management emphasized

Individual attitude Individual behaviors Group processes

This approach recognizes the significance of behavioral processes in the workplace

Slide 5Slide 5

Mary Parker Follet:(1868-1933)Focusing on Group Influences:Though Follet worked during the scientific management era, she understood the significance of the human element in organizations She argued that organizational participants were influenced by the group within which they workedShe suggested that organizations function on the principle of “power with” rather than “power over”What is the power she is talking about?

The PowerThe PowerPower according to Follet, was the ability Power according to Follet, was the ability to to influenceinfluence and bring about change and bring about changeShe argued that She argued that powerpower should not be should not be based on hierarchy, based on hierarchy, insteadinstead, it should be , it should be based on based on cooperationcooperation and should involve and should involve both both superiors and subordinatessuperiors and subordinatesIn other words, she advocated (publicly In other words, she advocated (publicly supported):supported):

power sharing power sharing The concept of integration (finding a solution The concept of integration (finding a solution acceptable to all group members)acceptable to all group members)

Slide 5Slide 5

Elton Mayo:(1880-1949) Focusing on Human Relations:Elton Mayo The “Father of the Human Relations Approach,” led the team which conducted a study at:– Western Electric’s Hawthorne Plant (1927)

Objective: To evaluate the attitude and psychological reaction of workers in on-the-job situationParticipants: The researchers and scholars associated with the Hawthorne experiments were:

– Elton Mayo– Fritz Roethlisberger– T N Whitehead– William Dickson

The study was started in 1924 by Western Electric’s industrial engineers and was extended through the early 1930sThe experiments were conducted in four phases:

– Illumination experiments (1924-1927) – Relay assembly test room experiments (1927-1923)– Interview phase (1928-1930)– Bank wiring observation room experiments (1931-1932)

Illumination experiments (1924-1927)Illumination experiments (1924-1927)

These experiments involved These experiments involved manipulatingmanipulating the illumination for one group of workers the illumination for one group of workers (called the experimental or (called the experimental or testtest group) group) and and comparingcomparing their subsequent their subsequent productivity with the productivity of productivity with the productivity of another group (the another group (the controlcontrol group) for group) for whom the illumination was whom the illumination was notnot changed changedThe results of the experiments were The results of the experiments were ambiguous (ambiguous (more than onemore than one information) information)

Illumination experiments (contd)Illumination experiments (contd)For the For the test test group:group:– The performance improved as theThe performance improved as the– However, the performance of the However, the performance of the

Test group rose steadily even whenTest group rose steadily even when

The illumination for the group was made dimThe illumination for the group was made dim

– Compounding the Compounding the mysterymystery, the , the control group’scontrol group’s productivity productivity also also tended to tended to riserise

– The researchers concluded that group productivity The researchers concluded that group productivity was was notnot directly related to illumination intensity but directly related to illumination intensity but something elsesomething else

– At this point At this point Elton Mayo was calledElton Mayo was called to participate in to participate in conducting the conducting the nextnext phase of the experiments phase of the experiments

light

Relay assembly test room experiments (1927-1933)

In this phase, researchers were In this phase, researchers were concernedconcerned about working conditions like: about working conditions like:

Working hoursWorking hours

Frequency Frequency

Duration of rest periodsDuration of rest periods

– The researchers selected The researchers selected sixsix women who women who were informed about the experiment were were informed about the experiment were asked to assemble a asked to assemble a smallsmall device called an device called an electric relayelectric relay

Relay assembly test room experiments

In the course of the experiments the In the course of the experiments the following were following were alteredaltered::

Wages Wages increasedincreased

Rest period Rest period variedvaried

Duration of work was Duration of work was shortenedshortened

Privileged to leave the workstation Privileged to leave the workstation withoutwithout permissionpermission

Received Received special attentionspecial attention from the researchers from the researchers

Generally, productivity Generally, productivity increased increased regardlessregardless of how the factors under of how the factors under consideration were consideration were MANIPULATEDMANIPULATED

““Hawthorn effect”Hawthorn effect”

The Harvard University group ultimately The Harvard University group ultimately concluded:concluded:

Better treatmentBetter treatment of employees made them more productive of employees made them more productiveOne of the findings of the study was the identification of the One of the findings of the study was the identification of the concepts which came to be described as the “concepts which came to be described as the “Hawthorn Hawthorn effect”effect”

The “Hawthorn effect” is defined as the The “Hawthorn effect” is defined as the possibility that individuals picked up to possibility that individuals picked up to participate in a study may show higher participate in a study may show higher productivity productivity ONLYONLY because of the added because of the added ATTENTIONATTENTION they receive from the researchers they receive from the researchers rather than any other factor listed in the studyrather than any other factor listed in the study

Interview phase (1928-1930)– During the course of the experiments, about During the course of the experiments, about

21, 000 people were interviewed over a 21, 000 people were interviewed over a three three year period to explore the year period to explore the reasonsreasons for human for human behavior at workbehavior at work

– The following points were observed:The following points were observed:The social demands of the workers are influenced The social demands of the workers are influenced by by social experiencessocial experiences in groups in groups both insideboth inside and and outside the workplace outside the workplace

The The social social organization of the company represents organization of the company represents a a system of valuessystem of values from which the worker derive from which the worker derive satisfaction or dissatisfaction according to his satisfaction or dissatisfaction according to his perceptionperception of his social status and the expected of his social status and the expected social rewardssocial rewards

Observations (contd)Observations (contd)– The position or status of the worker in the The position or status of the worker in the

company is a company is a referencereference from which the from which the worker assigns worker assigns meaning and valuemeaning and value to the to the events, objects, and features of his events, objects, and features of his environment, such as environment, such as hours of workhours of work, , wages wages etc.etc.

– Objects, persons and events carry Objects, persons and events carry social social meaningmeaning. Their relation to employee . Their relation to employee satisfaction or dissatisfaction is purely based satisfaction or dissatisfaction is purely based on the employee’s on the employee’s personal situation and personal situation and how he perceives themhow he perceives them

Observations (contd)Observations (contd)The personal situation of the worker consists of:The personal situation of the worker consists of:– A personal reference:A personal reference:

Pertains to a person’s:Pertains to a person’s:– SentimentsSentiments– DesiresDesires– InterestsInterests

– A social reference:A social reference:Pertains to a person’s:Pertains to a person’s:

– PastPast interpersonal relationships interpersonal relationships– PresentPresent interpersonal relationships interpersonal relationships

A complaint is not necessarily an objective A complaint is not necessarily an objective recital of facts, it can also be a recital of facts, it can also be a symptomsymptom of of personal personal disturbancedisturbance, the causes of which may , the causes of which may be be deep-seateddeep-seated

Bank wiring observation room experiments (1931-1932)

These experiments were undertaken by These experiments were undertaken by researchers to researchers to testtest some of the some of the ideas ideas they had they had gatheredgathered during the during the interviewsinterviews

The The fourteenfourteen participants in the experiment were participants in the experiment were asked to asked to assemble assemble telephone wiring to produce telephone wiring to produce terminal banksterminal banksThis time This time nono changes were made in the physical changes were made in the physical working conditionsworking conditionsWorkers were paid on the basis of an Workers were paid on the basis of an incentive incentive pay planpay plan, under which their pay increased as their , under which their pay increased as their output increasedoutput increasedResearchers observed that output Researchers observed that output stayed at a stayed at a fairly constant levelfairly constant level, which was , which was contrary contrary to their to their expectationsexpectationsTheir analysis showed that the group Their analysis showed that the group encouraged encouraged neither too neither too muchmuch nor too nor too little little workwork

Contributions/Criticisms of Hawthorne experimentsContributions/Criticisms of Hawthorne experiments

Contributions:Contributions:– The Hawthorne experiments, which The Hawthorne experiments, which laidlaid the the

foundation for the Human Relations Movement,foundation for the Human Relations Movement, made significant contribution to the evolution of made significant contribution to the evolution of management theorymanagement theory

Criticism:Criticism:– The have been criticized on the following:The have been criticized on the following:

The procedures, analysis of findings, and the The procedures, analysis of findings, and the conclusions reached were found to be conclusions reached were found to be questionable questionable (little evidence)(little evidence)The relationship made between the satisfaction or The relationship made between the satisfaction or happiness of workers and their productivity was happiness of workers and their productivity was tootoo simplistic simplisticThese studies These studies failedfailed to focus attention on the to focus attention on the attitudesattitudes of employees at the workplace of employees at the workplace

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Abraham Maslow:(1908-1970)

Focusing on Human Needs:– A Brandeis University psychologist, theorized

that people were motivated by a hierarchy of needs

– His theory rested on three assumptions:First – All of us have needs which are never completely fulfilledSecond – Through our actions we try to fulfill our unsatisfied needs

Abraham Maslow (contd)Third – Human needs occur in the following hierarchical manner:

– Physiological needs (Basics need- food, shelter & clothing– Safety or security needs– Social or belongingness needs– Esteem or status needs– Self-actualization needs

According to Maslow, once needs at a According to Maslow, once needs at a specific level have been specific level have been satisfiedsatisfied, they no , they no longer act as longer act as motivatorsmotivators of behavior of behaviorThen the individual strives to fulfill needs Then the individual strives to fulfill needs at the at the next levelnext level

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Douglas McGregor:(1906-1964)Challenging Traditional (old) Assumption about employees Douglas McGregor developed two assumptions about human behavior:– Theory X:

Presents an essentially negative view of people

– Theory Y:Is more positive and presumes that workers can be creative and innovativeAre willing to take responsibilityCan exercise self-control and can enjoy their workThey have higher level needs which have not been satisfied by the job

Some more ideas about Theory X & YSome more ideas about Theory X & YAccording to McGregor, these According to McGregor, these twotwo theories reflect the theories reflect the two extremetwo extreme sets of belief that different sets of belief that different managersmanagers have have about their about their workersworkersTheory X,Theory X, managers assume managers assume that:that:

Workers are Workers are lazylazyHave little Have little ambitionambitionDislike Dislike workworkWant to avoid Want to avoid responsibilityresponsibilityNeed to be closely Need to be closely directeddirected to make them work effectively to make them work effectively

Like Maslow’s theory, McGregor’s Theory X & Theory Y Like Maslow’s theory, McGregor’s Theory X & Theory Y influenced influenced many practicing managersmany practicing managersThese theories helped managers develop These theories helped managers develop newnew ways of ways of managing the workersmanaging the workers

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Chris Argyris: (1923 - Matching Human & Organizational DevelopmentA Yale University professor in psychology made significant contributions to the behavioral school of management thoughtsThe major contributions of this behavioral scientist are:

The maturity-immaturity theoryIntegration of individual and organizational goalModel I and Model II organization analysis

The maturity-immaturity theoryArgyris points out the Argyris points out the inherent inherent (in-built) (in-built) conflictconflict (opposing each other) between (opposing each other) between the the healthy individualhealthy individual and the and the rigidrigid structure structure of the of the formalformal organization organizationHe believes that people progress He believes that people progress fromfrom a a stage of stage of immaturityimmaturity and and dependencedependence to a to a state of state of maturitymaturity and and independenceindependenceMany organizations tend to keep their Many organizations tend to keep their employees in a dependence state, employees in a dependence state, thereby blocking further progress thereby blocking further progress resulting in failure and frustration resulting in failure and frustration

How to correct it?How to correct it?Integration of individual and organizational Integration of individual and organizational goals;goals;Argyris argues, that conflict can be corrected by Argyris argues, that conflict can be corrected by techniques such as:techniques such as:– Job enlargementJob enlargement– Job loadingJob loading

This will:This will:– Increase the work-related responsibilities of the Increase the work-related responsibilities of the

individualindividual– Allow him to participate in the decision-making Allow him to participate in the decision-making

processprocess

Model I and Model II organization analysis

Argyris classifies organizations on the basis of Argyris classifies organizations on the basis of the employees’ set of values as :the employees’ set of values as :– Model I:Model I:

The employees here are The employees here are manipulativemanipulative and and pittedpitted against against each othereach other

They are They are not not willing to take riskswilling to take risks

– Model II:Model II:Workers are Workers are open open to learning and to learning and lessless manipulative manipulative

Their Their accessaccess to information gives them freedom to make to information gives them freedom to make informed choicesinformed choices

This intern This intern increasesincreases their their willingnesswillingness to take risks to take risks

Hence, according to Argyris, managers should Hence, according to Argyris, managers should strive to create a strive to create a Model IIModel II environment environment Slide 5Slide 5

Quantitative ApproachQuantitative ApproachThe quantitative management perspective The quantitative management perspective emerged during emerged during World War IIWorld War II between US Army between US Army and UK Navy (Royal Navy) brought together and UK Navy (Royal Navy) brought together managers, government officials and scientistsmanagers, government officials and scientists to help it deploy its to help it deploy its resources more efficiently resources more efficiently and effectivelyand effectivelyThese These warwar experts used some of the experts used some of the mathematical approaches to management mathematical approaches to management devised earlier by devised earlier by Taylor and GanttTaylor and Gantt to solve the to solve the logisticallogistical (supply of material/ positioning of (supply of material/ positioning of ships/men/arms and ammunitions etc.) ships/men/arms and ammunitions etc.) problems faced by the problems faced by the army army

Quantitative Approach (contd)Quantitative Approach (contd)

This approach focuses on achieving This approach focuses on achieving organizational organizational effectiveness effectiveness through the through the application of:application of:– Mathematical conceptsMathematical concepts– Statistics conceptsStatistics concepts

The The three three main branches of the main branches of the quantitative approach are:quantitative approach are:– Management scienceManagement science– Operations managementOperations management– Management information systemsManagement information systems Slide 6Slide 6

Management ScienceManagement ScienceThe management science approach stresses the use of:The management science approach stresses the use of:

Mathematical modelsMathematical models::– Waiting line theory or queuing theoryWaiting line theory or queuing theory– Linear programmingLinear programming– The decision theoryThe decision theory– The situation theory The situation theory – Time series analysis etc.Time series analysis etc.

StatisticalStatistical models for decision-making models for decision-making

Here, we visualize that management as a logical entity, Here, we visualize that management as a logical entity, the action of which can be expressed in terms of:the action of which can be expressed in terms of:

Measurement dataMeasurement dataMathematical symbolsMathematical symbolsRelationship among themRelationship among them

Another name commonly used for management science Another name commonly used for management science is is operations researchoperations research Slide 6Slide 6

Operations ManagementOperations ManagementOperations management is an Operations management is an appliedapplied form of form of management sciencemanagement science

It It dealsdeals with the effective management of the with the effective management of the production processproduction process and the and the timely delivery timely delivery of of an organization’s an organization’s productsproducts and and services services

Operations management is concerned with:Operations management is concerned with:– InventoryInventory management management– Work Work schedulingscheduling– Production Production planningplanning– Facilities Facilities location and designlocation and design– QualityQuality assurance assurance

Operations Management (contd)Operations Management (contd)

The The toolstools used by operations managers used by operations managers are:are:– Forecasting:Forecasting:

Example: Assessing before hand the next years Example: Assessing before hand the next years salesale

– Inventory Inventory analysisanalysis– Material requirement Material requirement planningplanning systems systems– Networking Networking modelsmodels– Statistical Statistical qualityquality control methods control methods– Project Project planning planning – Control Control techniquestechniques

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Management Information SystemsManagement Information Systems

Management information system Management information system focus on focus on designingdesigning and and implementing implementing computer basedcomputer based information systems information systems for business organizationsfor business organizationsIn simple terms, the MIS In simple terms, the MIS convertsconverts raw data into raw data into informationinformation and and provides the needed information to provides the needed information to eacheach manager at the right time, in manager at the right time, in the needed form the needed form

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Modern Approaches to managementModern Approaches to management

TwoTwo of these approaches are: of these approaches are:Systems Theory: Systems Theory: What is a system? (contd)What is a system? (contd)

According to this theory, an organizational system According to this theory, an organizational system has has fourfour major components major components

– Inputs:Inputs: Money, Material, Men, Machines and Information Money, Material, Men, Machines and Information are required to produce goods and servicesare required to produce goods and services– Transformation process Transformation process : Managerial and technical : Managerial and technical

abilities are used to convert abilities are used to convert inputs into outputs inputs into outputs

– Output : Output : Products, Services, Profits and other results Products, Services, Profits and other results produced by the organizationproduced by the organization

– FeedbackFeedback : Refers to information about the outcomes : Refers to information about the outcomes and the position of the organization relative to the and the position of the organization relative to the environment it operates inenvironment it operates in

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Systems Theory (contd)Systems Theory (contd)Two basics types of systems are:Two basics types of systems are:– Open systems:Open systems:

A system that A system that interactsinteracts with its with its environmentenvironment is is regarded as an regarded as an openopen system system

What is an What is an environmentenvironment??– SocietySociety– GovernmentGovernment– Creditors and SuppliersCreditors and Suppliers– CustomersCustomers– EmployeesEmployees– ShareholdersShareholders

– Closed systems:Closed systems:A system that A system that does notdoes not interacts with its environment interacts with its environment is regarded as a is regarded as a closedclosed system system Slide 7Slide 7

Contingency Theory:Contingency Theory:This is This is alsoalso known as the known as the situational theory situational theory Management Science Scientific Management Science Scientific

Management (1856-1919)Management (1856-1919)

According to this theory there is According to this theory there is nono one best way to one best way to manage all situationsmanage all situationsThe contingency approach was developed by :The contingency approach was developed by :

ManagersManagersConsultantsConsultantsResearchersResearchers

– The above (The above (Rudy GiulianiRudy Giuliani -the new York city mayor) make -the new York city mayor) make management decisions or adopt a particular management style management decisions or adopt a particular management style onlyonly after carefully considering after carefully considering all all situational factorssituational factors

Which is the Which is the bestbest way? way?– The response “The response “It dependsIt depends” holds good for several management ” holds good for several management

situations situations ExampleExample: September 9/11 (2001) attack on new York city: September 9/11 (2001) attack on new York city

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Emerging Approaches in Management thoughtEmerging Approaches in Management thought

Theory Z:Theory Z:– This theory This theory combinescombines the positive aspect of both the positive aspect of both

American and Japanese management stylesAmerican and Japanese management styles– This approach This approach involvesinvolves

providingproviding::– Job security to employees to ensure their loyalty Job security to employees to ensure their loyalty – Long-term association with the companyLong-term association with the company

Job rotation of employees to develop their Job rotation of employees to develop their cross-functionalcross-functional skillsskills

– This approach wants their employees to get involved This approach wants their employees to get involved in in decision-makingdecision-making process, information control and process, information control and performance measurement (why?)performance measurement (why?)

– Here, Here, The organization shows The organization shows concernconcern for its employees’ well- for its employees’ well-being being Lays Lays importantimportant on their training and development on their training and development

Emerging Approaches in Management Emerging Approaches in Management thought (contd)thought (contd)

Quality Management:Quality Management:– Is a management approach that Is a management approach that directsdirects the the

efforts of management towards bringing efforts of management towards bringing about about continuous improvementcontinuous improvement in product in product and service quality to achieve higher levels of and service quality to achieve higher levels of customer satisfaction and build customer customer satisfaction and build customer loyaltyloyalty

– To be successful and effective, this approach To be successful and effective, this approach needs to be needs to be integratedintegrated with an organization's with an organization's strategystrategy

SummarySummary

Stages of evolution of management Stages of evolution of management thought: thought: – Pre-classical approach Pre-classical approach – Classical ApproachClassical Approach– Behavioral ApproachBehavioral Approach– Quantitative Approach Quantitative Approach – Modern Approaches Modern Approaches