PRINCIPLEOFMANAGEMENTEvolutionofManagementTheoryChapter2EvolutionofManagementTheoryJobSpecializationandtheDivisionofLaborAdamSmith(18thcenturyeconomist)Observedthatfirmsmanufacturedinoneoftwodifferentways:-Craft-style—eachworkerdidallsteps.-Production—eachworkerspecializedinonestep.JobSpecializationandtheDivisionofLaborAdamSmith(18thcenturyeconomist)RealizedthatjobspecializationresultedinmuchhigherefficiencyandproductivityBreakingdownthetotaljoballowedforthedivisionoflaborinwhichworkersbecameveryskilledattheirspecifictasks.FrederickWTaylor(1856–1917)FatherofScientificManagementPublished“PrinciplesofScientificManagement”in1911;Thesystematicstudyoftherelationshipsbetweenpeopleandtasksforthepurposeofredesigningtheworkprocessforhigherefficiency.FrederickWTaylor(1856–1917)Taylorlisted“newduties”formanagement.Therewere:Thedevelopmentofatruescience;Thescientificselection,educationanddevelopmentofworkmen;Friendly,closeco-operationbetweenmanagementandworkers.FourPrinciplesofScientificManagement1)Studythewaysjobsareperformednowanddeterminenewwaystodothem.Gatherdetailedtimeandmotioninformation.Trydifferentmethodstoseewhichisbest.FourPrinciplesofScientificManagement2)Codifythenewmethodsintorules.Teachtoallworkersthenewmethod.FourPrinciplesofScientificManagement3)Selectworkerswhoseskillsmatchtherules.4)Establishfairlevelsofperformanceandpayapremiumforhigherperformance.WorkersshouldbenefitfromhigheroutputAdministrativeManagementTheoryAdministrativeManagementThestudyofhowtocreateanorganizationalstructurethatleadstohighefficiencyandeffectiveness.MaxWeber(1864–1920)GermansociologistFormulatedideasonidealmanagementapproachforlargeorganization.DevelopedasetofideasaboutthestructureofanorganizationthatdefinewhatweknowasbureaucracyMaxWeber(1864–1920)MaxWeber(1864–1920)Weber’sperspectiveonadministrativemanagementare:›Adivisionoflabor.Inwhichauthorityandresponsibilityaredefinedveryclearlyandsetoutasofficialduties.›Hierarchyofauthority.Officeorpositionsareorganizedinahierarchyofauthorityresultinginachainofcommand.›Formalselection.Allemployeesareselectedonthebasisoftechnicalqualificationsthroughformalexaminationsorbyeducationortraining.MaxWeber(1864–1920)Weber’sperspectiveonadministrativemanagementare:Careermanager.Managersareprofessionalswhoworkforfixedsalariesandpursue“careers”withintheirrespectivefields.Theyarenot“owners”oftheunitstheyadminister.Formalrules.Administratorsshouldbesubjecttostrictformalrulesandothercontrolsregardingtheconductoftheirofficialduties.HenryFayol(1841–1925)AminingengineerandmanagingdirectorofalargeFrenchcompany;Published“GeneralandIndustrialManagement”in1918;HenryFayol(1841–1925)Fayol’s14principlesofmanagement1.DivisionofLabor.Workshouldbedividedtoassistspecialization2.Authority.Authorityandresponsibilityshouldbeequal.3.Discipline.Disciplinehelpsworkersdevelopobedience,diligence,energyandrespect.4.UnityofCommand.Nosubordinateshouldreporttomorethanonesuperior.HenryFayol(1841–1925)Fayol’s14principlesofmanagement5.UnityofDirection.Alloperationswiththesameobjectiveshouldhaveonemanagerandoneplan.6.Subordinationofindividualinteresttogeneralinterest.Theinterestofoneindividualorgroupshouldnottakeprecedenceovertheinterestoftheenterpriseasawhole.7.Remuneration.Remunerationandmethodsofpaymentshouldbefair.HenryFayol(1841–1925)Fayol’s14principlesofmanagement8.Centralization.Managersmustmaintainfinalresponsibilitybutshoulddelegatecertainauthoritytosubordinates.9.Scalarchain.Aclearlineofauthorityorchainofcommandshouldextendfromthehighesttothelowestlevelofanenterprise.Thishelpstoensureanorderlyflowofinformationandsupplementtheprincipleofunityandcommand.HenryFayol(1841–1925)Fayol’s14principlesofmanagement10.Order.Aplaceforeverythingandeverythinginitsplace.Properschedulingofworkandtimetablestocompleteworkareimportant.Thiscanensurematerialsareintherightplaceattherighttime.11.Equity.Employeesshouldbetreatedwithkindnessandjustice.12.Stabilityoftenureofpersonnel.Managementshouldworktowardsobtaininglong-termcommitmentsfromstaff.HenryFayol(1841–1925)Fayol’s14principlesofmanagement13.Initiative.Workersshouldbeallowedtoconceiveandexecuteplansinordertodeveloptheircapacitytothefullestandfeellikeanactivepartoftheorganization.14.Espritdecorps.Harmonyandunionhelptobuildthestrengthofanenterprise.Itisanextensionoftheprincipleofunityofcommand,emphasizingtheneedforteamworkandtheimportanceofcommunication.BehavioralManagementTheoryThestudyofhowmanagersshouldbehavetomotivateemployeesandencouragethemtoperformathighlevelsandbecommittedtotheachievementoforganizationalgoals.Focusesonthewayamanagershouldpersonallymanagetomotivateemployees.EltonMayorIn1941thepublicationoftheresultsofthepsychologicalexperimentsofEltonMayorattheHawthorne(Illinois)plantoftheWesternElectricCompanywasanotablelandmark.Itfocusedonthecomponentsofthejobandworksatisfactiononthepartofemployees.EltonMayorTheHawthorneExperimentsweredividedintothreephasesTestroomstudiesInterviewingstudiesObservationalstudiesEltonMayorTestroomst