Chapter 2
Management Theories
By Capt. Dr. Pooja
Mehra(Retd)
Why Management History?
To understand where ideas came from.
To see the role of social, legal,
political, economic, technological
factors in developing management
thought and practice.
The Industrial Revolution
During the late 18th and early 19th centuries
1760 -1840م
The Industrial Revolution results a major turning point in human history;
The Revolution that changed the world forever
Industrial Revolution – a change from
making things by hand to making
them in factories.
An original steam engine
A cotton factory
The Industrial Revolution – New Technology
Manufacturing
Steam engines
Cotton gin
Mass production through standardization and
specialization
Transportation
Steam-powered ships
Railroads
Communications
Telegraph
Large Organizations and New Approaches
to Management
Economic transformation:
Previously – family farms, small workshops.
After Industrial Revolution – large organizations,
requiring management skills .
New demands on management:
Need for professional managers (as opposed to
owners)
Need to plan, structure, and schedule activities.
Need for worker training and socialization to factory
work.
Management Perspectives Over Time
Exhibit 2.1, p.44
2000
The Technology-Driven Workplace
1990 2010
The Learning Organization
1980 2010
Total Quality Management
2000
1970
Contingency Views
2000
1950
Systems Theory
1940 2000
Management Science Perspective
1990
1930
Humanistic Perspective
1890 1990
Classical
1940 2010
1870
Schools of Management Thought
Classical School
Scientific management.
Administrative Principles.
Behavioral School
Human Relationships Approach
Management Science School
Recent Historical Development
Systems Theory
1. Scientific Management: Frederick Taylor
(1856-1915)
Frederick Taylor was an American mechanical
engineer who wanted to improve industrial
efficiency.
He is considered as the father of scientific
management.
Worked at Midvale Steel (beginning as a common
worker, chief engineer, in 6 years)
Started with time study and motivation plans.
Taylor wanted to reduce the time a worker spent
on each task by optimizing the way the task was
done.
1. Scientific Management: Frederick Taylor
(1856-1915)
ScientificManagement as defined
by Frederick Taylor:
The systematic study of the
relationships between people
and tasks to redesign the work
for higher efficiency.
The 4 Principles
Four Principles to increase efficiency:
1. Study the way the job is performed
now & determine new ways to do it.
2. Organize the new method into rules.
3. Select workers whose skills match the
rules set in Step 2.
4. Establish a fair level of performance
and pay for higher performance.
Scientific Management: summarize
Contributions:
Pay for performance.
Careful examination of job tasks.
Importance of training and selection.
But……..* Problems
Assumed workers were robot without
social needs or human needs.
Assumed all individuals were the
same.
2. Administrative Principles Theory:
Henry Fayol (1841–1925)
HenriFayol (1841- 1925) was a French mining
engineer.
Hewas one of the most influential contributors
to modern concepts of management.
Focus:
Organization rather than the individual.
described the management functions of
planning, organizing, coordinating, and
controlling.
Fayol’s Principles
Henri Fayol, developed a set of 14 principles:
1. Division of work: allows for job specialization.
2. Authority and Responsibility:
3. Unity of Command: Employees should have only
one boss.
4. Line of Authority: a clear chain from top to
bottom of the firm.
5. Centralization: the degree to which authority
rests at the very top.
Fayol’s Principles
6. Unity of Direction: One plan of action to
guide the organization.
7. Equity: Treat all employees fairly in justice
and respect.
8. Order: Each employee is put where they have
the most value.
9. Initiative: Encourage innovation.
10. Discipline: respectful employees needed.
Fayol’s Principles
11. Compensation of Employees : The payment
system contributes to success.
12. Stability of Employees : Long-term
employment is important.
13. General interest over individual interest: The
organization takes priority over the individual.
14. Common spirit: Share enthusiasm or loyalty to
the organization.
Fayol’s 14 Principles
7. Equity
1. Division of work
8. Order
2. Authority and
9. Initiative
Responsibility
10. Discipline
3. Unity of command 11. Compensation
4. Line of authority 12. Stability of Employees
5. Centralization 13. General interest over
individual interest
6. Unity of Direction
14. Common spirit
Behavioral Management School
Focuseson the way a manager should
personally manage to motivate employees.
Behavioralmanagement theory is often called
the human relations movement because it
addresses the human dimension of work.
Thetheorists who contributed to this school
viewed employees as individuals, resources,
and assets to be developed and worked with —
not as machines, as in the past.
Theory X and Y
Douglas McGregor proposed the two different sets of worker molds.
Theory X - Classical Theory :
1. Assumes the average worker is lazy, dislikes work and will do as little as
possible.
2. Managers must closely supervise and control through reward and punishment.
Theory Y- Human relationships Theory :
1. Assumes workers are not lazy, want to do a good
job and the job itself will determine if the worker likes
the work.
2. Managers should allow the workers feel freedom, and exercise initiative and self-
direction.
Theory X / Theory Y
Theory X Theory Y
Employee is lazy. Employee is not lazy.
Managers must Must create work
closely supervise. setting to build
initiative.
Create strict rules
& defined rewards Provide authority to
workers.
Management Science Theory
Quantitative management :
uses mathematical techniques, like linear programming,
modeling, simulation and chaos theory
Operations management :
provides managers a set of techniques they can use to
analyze any aspect of an organization’s production system
to increase efficiency
Management Science Theory
Total quality management :
focuses on analyzing an organization’s input, conversion,
and output activities to increase product quality
Management information systems :
help managers design systems that provide information
that is vital for effective decision making
The System Theory
What’s the system approach?
Two basic types of the system: closed and open
Closed systems are not influenced by and do not interact with their
environment.
open system dynamically interacts with its environment.
An organization is an open system
An Organization Is an Open System
An organization is a system that interacts with
and depends upon its environment.
Organization’s stakeholders: any group that is
affected by organizational decisions and policies.
The manager’s job is to coordinate all stakeholders
to achieve the organization’s goals.
Organizational survival often depends on
successful interactions with the external
environment.
The Open-Systems View
Inputs: the acquisition of external resources to produce goods and services.
Transformation: transforms the inputs into outputs of finished goods and
services.
Output: the release of finished goods and services to its external
environment.
Maslow’s
Hierarchy-of-Needs Theory
Abraham Maslow )1908-1970).
Father of Humanistic Psychology. علم النفس االنساني
Maslow's hierarchy of needs theory is a motivational theory in psychology
containing a five level model of human needs, often shown as hierarchical
levels within a pyramid.
Maslow’s
Hierarchy-of-Needs Theory
