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Schools of Management Thought Management Theory & Practice Nimal C Namboodiripad

Schools of Management Thought

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Schools of Management Thought

Management Theory & Practice

Nimal C Namboodiripad

Schools of Management Thought

• Ancient Era

• Pre-scientific Management Era

• Classical School

– Scientific Management School(1)

– Classical Organisation Theory(2)

• Transitional School

• Human Relations/Behavioural School(3)

• Management Science/Quantitative Management School(4)

Schools of Management Thought

• Systems School

• Contingency School

• Modern Era

Persons behind the schools

• Ancient Era

– Machiavelli

– Chanakya

– Sun Tzu

• Pre-Scientific Management

– Robert Owen

– Charles Babbage

Persons behind the schools

• Scientific Management

– Frederick W.Taylor

– Henry L Gantt

– Frank B Gilbreth & Lillian M.Gilbreth

Persons behind the schools

• Classical Organisation

– Henri Fayol

– Max Weber

• Transition School

– Mary Parker Follett

– Chester I Barnard

Persons behind the schools

• Human Relations/Behavioural School

– Elton Mayo, Fritz J Roethlisberger, William J

Dickson – Hawthorne Experiment

– Abraham Maslow, Douglas McGregor

• Modern Era

– Peter Drucker, Tom Peters, Edwards Deming

Sun Tzu

• Book on Art of War written 2000 years

back

• Some of his dictums include

– When enemy advance we retreat

– When the enemy halts we harass

– When the enemy seeks to avoid battle we attack

– When the enemy retreats we pursue

Chanakya

• Also called Kautilya, lived in Pataliputra in ancient India

• Famous book being Arthashastra also called ‘Chanakya Sutra’

• It is a treatise on politics, economics and public affairs

• Chandragupta Maurya, founder of the Mauryan Empire was his disciple and used his theories extensively.

Machiavelli

• Principles in “Discourses” written in 1531

• The Florentine’s principles includes

– Organisation will do better if members have autonomy

– The organisation is lasting if many are in charge of it

– A weak manager cannot follow another and maintain authority

– Even in change should include some of the ancient customs

Robert Owen

• ‘World’s’ first enlightened (and first personnel) manager(1771-1858)

• Post Industrial Revolution

• Stopped employing children below 10

• Reduced working hours from 14 to 10

• Built houses for workers with proper sanitation

• Nursery for children

• Showed higher wages increased profits through higher productivity

• Unique incentive schemes

• Informal workers participation in management

Charles Babbage

• Englishman who first came up with the idea

of division of labour(contemporary of

Robert Owen)

• Each factory operation should be isolated

and given to different people to increase

productivity

• Modern assembly line is based on his ideas

Frederick W Taylor

• Taylor(1856-1915) based his philosophy on

4 principles(Scientific Management, 1911)

– Development of science of management to get

best method of work

– Scientific selection of workers to find the best

fit

– Scientific education and development of worker

– Intimate, friendly relations between

management and labour

Frederick W Taylor

• Using time study as his base he broke each

job into component parts and designed

quickest and best methods of performance

• Pay more to more productive workers to

motivate them- differential rate system

• People feared that the jobs would be

exhausted

• Managers exploited workers

Henry Gantt

• Worked(1861-1919) with Taylor, but later

reconsidered his system

• Each person who finished his quota will get

a bonus

• So also the supervisor under whom he is

working

• If all workers under a supervisor attained

quota he will get additional bonus

Henry Gantt

• Each worker’s job was publicly graded

black when achieved standard, red when not

• Originated a charting system for production

scheduling

• Forms basis of CPM of DuPont and PERT

of Navy

The Gilbreths

• Frank B(1868-1924) and Lillian M(1878-1972) a

husband-wife team came up with fatigue and

motion studies

• Based on the study way’s for promoting worker’s

welfare was planned out

• Increase morale because of physical benefits as

well as proof of management’s concern

• From Gilbreths come the term Therbligs(17 basic

movements from lifting, moving etc.)

Henri Fayol

• First (French Executive, 1841-1925) to

systematize managerial behaviour

• Aimed at top management than shop floor

• Sound management has certain patterns which can

be analysed

• Unlike Taylor who was interested in the functions

he was interested in total organisation

• Management could be taught they need not be

born

Henri Fayol

• He came up with 14 Principles of

Management

– Division of labour

– Authority

– Discipline

– Unity of Command

– Unity of Direction

– Common good over individual interest

Henri Fayol

– Remuneration

– Centralisation

– Heirarchy

– Order

– Equity

– Stability of staff

– Initiative

– Espirit de corps

Max Weber

• He, a German(1864-1920) came up with the

theory of bureaucratic management

• Ideal organisation is one in which activities

and objectives are rationally thought out

and division of labour clearly spelt out

• Although it became a success through such

organisations as Ford, now it has been

discredited

Mary Parker Follett

• She(1868-1933) felt that no one could be a whole person except as member of a group

• She said that management is the art of getting things done through people

• She is considered the first democratic and dynamic manager

• She was interested in the welfare of the people but was at the same tough in matters of attaining company objectives

Mary Parker Follett

• Her holistic model of control also took into

account effects of politics, economy and

biology – paving way for study of extenal

environment

• While supporting Taylor on management

and labour sharing common purpose she

also maintained that artificial differences

between management and labourers should

be removed

Chester I Barnard

• Bernard(1886-1961) who became president of New Jersey Bell in 1927 said people come together in formal organisations to achieve objectives they cannot accomplish working alone

• Hence organisation’s goals should be kept in balance with individual’s

• For this the employee’s zone of indifference has to be identified – what the employees would do without questioning authority

Chester I Barnard

• He talked of ethical commitment to society

– instilling moral values in employees

• He also emphasised people working

together in groups – setting the tone for

team thinking

Hawthorne Experiments

• To help managers deal more effectively

with people – better human relations

improves morale and productivity

• Series of studies conducted at Western

Electric Company’s Hawthorne plant from

1924-33 near Chicago

• Began as an attempt to investigate relation

between level of lighting in workplace and

productivity

Hawthorne Experiments

• Test groups lighting was changed that of control group kept constant.

• Surprisingly there were erratic increase of productivity with changes in lighting

• New set of experiments where a set of people were placed in separate room and tested on several parameters.

• Wages increased, different rest periods given, workday and work week shortened.

Hawthorne Experiments

• Again got erratic results

• In between Elton Mayo(1880-1949) and his

Harvard associates Fritz J Roethlisberger and

William J Dickson became involved

• Consequent tests also proved something – groups

singled out for attention developed a sense of

pride and performed better

• Sympathetic supervision helped in this cause

• This is the Hawthorne effect

Hawthorne Experiments

• Control group performed better because of

the special attention of the researchers

themselves

• Informal workgroups have a positive effect

on productivity

Abraham Maslow

• Called father of humanist psychology(1908-1970)

• More sophisticated view of human beings and their drives

• Scientific investigation into the study of how people behaved in organisations

• Heirarchy of needs – physical, safety, love, esteem, self actualisation

• When one is achieved he goes into other

Abraham Maslow

• His ideas on management included

• Democracy at work place

• Synergy – originally developed by Ruth

Benedict – both people gain

• Characteristics

– Everyone to be trusted

– Everyone wants to improve his work

– People aim at perfection

Abraham Maslow

– Good attitude towards work

– Love and respect for boss

– Looks for appreciation in public

– Love their tools and materials

• Need heirarchy may change with country

• Sweden quality of life is ranked most

important

• Japan and Germany security ranked highest

Douglas McGregor

• Two alternate assumptions about people and

their work(1906-1964)

• Theory X states that managers believe that

employees are inherently lazy and must be

constantly coaxed to do the job properly

• Theory Y managers on the other hand

believe that people relish work and eagerly

approach their work

Herbert Simon(1916-)&

James March • In 1950s they developed hundreds of propositions

for scientific investigation, about patterns of

behaviour, especially with regards to

communication in organisations

• Herbert Simon is the first management thinker to

win a Nobel Prize in 1978

• His book administrative behaviour is a classic

• He says it is not rational

• Saw great potential in the computer for decision

making

Management Science Approach

• It was found that management problems can be solved by mathematical formulas

• Management consists of Planning, Implementation and Control. Especially useful in control function

• Operations Research started with the second world war in England

• Later Americans used it

• Still later it was used in management

Management Science Approach

• In this system for solving a problem

information is got from the different areas

• Using this information a mathematical

model is formed

• Robert McNamara who used this in Ford is

the pioneer.

• He later became Secretary of Defense in US

Systems Approach

• This takes a wholistic view of the

organisation

• Each organisation consists of a number of

sub systems which when working together

creates a synergy

Contingency Approach

• This is also called situational approach

• Any one school doesn’t work in all situation

• According to situation the management

technique has to change

• The question to be answered is what will

work best in this situation here