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Classical Management Theory

ClassicalManagement

Theory

ClassicalManagement

Theory

A theory that focused on finding the “one best way” to perform and manage tasks and included

•Classical Scientific management •Classical Administrative Management•Classical Bureaucratic management

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Classical Management Theory

ClassicalScientific

School

ClassicalScientific

School

Focused on the manufacturing environment and individual’s work productivity and efficiency

ClassicalAdministrative

School

ClassicalAdministrative

School

Emphasized the flow of information and how organizations should operate

ClassicalBureaucratic

School

ClassicalBureaucratic

School

Emphasized the flow of information and how organizations should operate/functions of management

Identified Organization as a system and management as a study of this system

Relationship Between Three Classical Theories Of Management

Focuses on the individual worker’s

productivity

Focuses on the functions of

management

Focuses on the overall

organizational system

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Lessons from Classical Scientific Thinkers

Analyze everythingAnalyze everything

Teach effective methods to othersTeach effective methods to others

Plan responsiblyPlan responsibly

Constantly monitor workersConstantly monitor workers

Control the work and the workersControl the work and the workers

HENRI FAYOLFather of Administrative management

Thoughts and Profile of Henri Fayol

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Henri Fayol was born in 1841 at Istanbul Turkey.He was a French management theorist.Fayol was one of the most influential contributors to modern concepts of management.Fayol has been described as the father of modern operational management theoryThe nineteen-year old engineer started at the mining company ultimately acting as its managing director Based largely on his own management experience, Fayol developed his concept of administration.

Henri Fayol was born in 1841 at Istanbul Turkey.He was a French management theorist.Fayol was one of the most influential contributors to modern concepts of management.Fayol has been described as the father of modern operational management theoryThe nineteen-year old engineer started at the mining company ultimately acting as its managing director Based largely on his own management experience, Fayol developed his concept of administration.

DIFFERENCE BETWEEN VIEWS OF TAYLOR AND FAYOL

Although his ideas have become a universal part of the modern management concepts, some writers continue to associate him with Taylor!!

A primary difference between Fayol and Taylor was that Taylor viewed management processes from the bottom up, while Fayol viewed it from the top down.

In the classic General and Industrial Management Fayol wrote that "Taylor's approach differs from the one we have outlined in that he examines the firm from the "bottom up

Fayol suggested that it is important to have unity of command : a concept that suggests there should be only one supervisor for each person in an organization….. Fayol criticized Taylor’s functional management in this way.’’

The most marked outward characteristics of functional management lies in the fact that each workman, instead of coming in direct contact with the management at one point only, receives his daily orders and help from eight different bosses.

Fayol said, those eight, were (1) route clerks, (2) instruction card men, (3) cost and time clerks, (4) gang bosses, (5) speed bosses, (6) inspectors, (7) repair bosses, and the (8) shop disciplinarian . This was an unworkable situation, and that Taylor must have somehow reconciled

Major Contributions of Henri Fayol

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First recognized that successful managers had to understand the basic managerial functions and believed specific management skills could be learned and taught He mentioned Six activities of an enterprise:1. Technical (production, manufacture, adaptation)2. Commercial (buying, selling, exchange)3. Financial (search for an optimum use of capital)4. Security (protection of property and persons)5. Accounting (Stock taking, balance sheets, cost statistics)6. Managerial: Fayol’s universal management functions:1.Planning 2.Organizing 3.Commanding 4.Coordinating

5.Controlling Developed a set of 14 general principles of management. Provided 16 managerial duties that a manager has to

perform

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Fayol’s General Principles of Management

1. Division of work2. Authority and responsibility3. Discipline4. Unity of command5. Unity of direction6. Subordination of individual interest to the common good7. Remuneration of personnel

8. Centralization9. Scalar chain10. Order11. Equity12. Stability13. Initiative14. Esprit de corps

Source: Based on Henri Fayol, General and Industrial Management, trans. Constana Storrs (London: Pittman & Sons, 1949).

Division of work: Specializing encourages continuous improvement in skills and the development of improvements in methods.

Authority : The right to give orders and the power to exact obedience.

Discipline : No slacking, bending of rules. The workers should be obedient and respectful of the organization.

Unity of command : Each employee has one and only one boss.

Unity of direction : A single mind generates a single plan and all play their part in that plan.

Subordination of Individual Interests : When at work, only work things should be pursued or thought about.

Remuneration : Employees receive fair payment for services, not what the company can get away with.

Centralization : Consolidation of management functions. Decisions are made from the top.

Scaler Chain (line of authority) : Formal chain of command running from top to bottom of the organization, like military

A

B1

C1

D1

B2

C2

D2

E1 E2

Order : All materials and personnel have a prescribed place, and they must remain there.

Equity : Equality of treatment (but not necessarily identical treatment)

Personnel Tenure : Limited turnover of personnel. Lifetime employment for good workers.

Initiative : Thinking out a plan and do what it takes to make it happen.

Esprit de corps : Harmony, cohesion among personnel. It's a great source of strength in the organization. Fayol stated that for promoting esprit de corps, the principle of unity of command should be observed and the dangers of divide and rule and the abuse of written communication should be avoided.

Bureaucratic Management

• Focuses on the overall organizational system.• Bureaucratic management is based upon:

– Firm rules– Policies and procedures– A fixed hierarchy– A clear division of labor

Bureaucratic Management: Weber

• Max Weber (1864–1920)– A German sociologist and historian who envisioned

a system of management that would be based upon impersonal and rational behavior—the approach to management now referred to as “bureaucracy.”

• Division of labor• Hierarchy of authority• Rules and procedures• Impersonality• Employee selection and promotion

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Weber’s Forms of Authority

• Traditional authority – Subordinate obedience based upon custom or tradition

(e.g., kings, queens, chiefs).• Charismatic authority

– Subordinates voluntarily comply with a leader because of his or her special personal qualities or abilities (e.g., Martin Luther King, Gandhi).

• Rational-legal authority– Subordinate obedience based upon the position held by

superiors within the organization (e.g., police officers, executives, supervisors).

Table 2.2 Weber’s Three Types of Authority

Type DescriptionTraditional Subordinate obedience based upon

custom or tradition

Charismatic Subordinate obedience based uponspecial personal qualities associatedwith certain social reformers, politicalleaders, religious leaders, ororganizational leaders

Rational–legal Subordinate obedience based uponthe position held by superiorswithin the organization

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Bureaucratic Hierarchical Power Structure