PowerPoint Presentation

to Accompany
Management, 10/e
John R. Schermerhorn, Jr.

Chapter 2:
History of Management Thought

Prepared by: Jim LoPresti

University of Colorado, Boulder
Published by: John Wiley & Sons, Inc.
 Planning Ahead — Chapter 2 Study Questions

 What can be learned from classical

management thinking?
 What insights come from behavioral
management approaches?
 What are the foundations of modern
management thinking?

Management 10/e - Chapter 2 2

Study Question 1: What can be learned from
classical management thinking?

 Classical approaches to
management include:
 Scientific management
 Administrative principles
 Bureaucratic organization

Management 10/e - Chapter 2 3

Figure 2.1 Major branches in the classical approach
to management.

Management 10/e - Chapter 2 4

Study Question 1: What can be learned from
classical management thinking?

 Scientific management (Frederick Taylor)

 Develop rules of motion, standardized work
implements, and proper working conditions for
every job.
 Carefully select workers with the right abilities for
the job.
 Carefully train workers and provide proper
incentives.
 Support workers by carefully planning their work
and removing obstacles.

Management 10/e - Chapter 2 5

Study Question 1: What can be learned from
classical management thinking?

 Scientific management (the

Gilbreths)
 Motion study
 Science of reducing a job or task to its
basic physical motions.
 Eliminating wasted motions improves
performance.

Management 10/e - Chapter 2 6

 Study Question 1: What can be learned from
classical management thinking?

 Practical lessons from scientific

management
 Make results-based compensation a performance
incentive
 Carefully design jobs with efficient work methods
 Carefully select workers with the abilities to do
these jobs
 Train workers to perform jobs to the best of their
abilities
 Train supervisors to support workers so they can
perform jobs to the best of their abilities

Management 10/e - Chapter 2 7

 Study Question 1: What can be learned from
classical management thinking?

 Administrative principles (Henri Fayol)

— rules of management:
 Foresight — to complete a plan of action for the
future.
 Organization — to provide and mobilize resources
to implement the plan.
 Command — to lead, select, and evaluate workers
to get the best work toward the plan.
 Coordination — to fit diverse efforts together and
ensure information is shared and problems solved.
 Control — to make sure things happen according
to plan and to take necessary corrective action.

Management 10/e - Chapter 2 8

Study Question 1: What can be learned from
classical management thinking?

 Administrative principles (Henri

Fayol) — key principles of management:
 Scalar chain — there should be a clear and
unbroken line of communication from the top
to the bottom of the organization.
 Unity of command — each person should
receive orders from only one boss.
 Unity of direction — one person should be in
charge of all activities with the same
performance objective.

Management 10/e - Chapter 2 9

Study Question 1: What can be learned from
classical management thinking?

 Bureaucratic organization (Max

Weber)
 Bureaucracy
 An ideal, intentionally rational, and very
efficient form of organization.
 Based on principles of logic, order, and
legitimate authority.

Management 10/e - Chapter 2 10

Study Question 1: What can be learned from
classical management thinking?

 Characteristics
 Possible
of bureaucratic disadvantages of
organizations: bureaucracy:
 Excessive paperwork
 Clear division of labor
or “red tape”
 Clear hierarchy of  Slowness in handling
authority
problems
 Formal rules and  Rigidity in the face of
procedures
shifting needs
 Impersonality  Resistance to change
 Careers based on  Employee apathy
merit

Management 10/e - Chapter 2 11

Study Question 1: What can be learned from
classical management thinking?

 Administrative principles (Mary Parker

Follett)
 Groups and human cooperation:
 Groups are mechanisms through which

individuals can combine their talents for a

greater good.
 Organizations are cooperating

“communities” of managers and workers.

 Manager’s job is to help people in the

organization cooperate and achieve an

integration of interests.

Management 10/e - Chapter 2 12

 Study Question 1: What can be learned from
classical management thinking?

 Administrative principles (Mary Parker

Follett)
 Forward-looking management insights:
 Making every employee an owner creates a
sense of collective responsibility (precursor of
employee ownership, profit sharing, and gain-
sharing)
 Business problems involve a variety of inter-
related factors (precursor of systems thinking)
 Private profits relative to public good (precursor
of managerial ethics and social responsibility)

Management 10/e - Chapter 2 13

Figure 2.2 Foundations in the behavioral or human
resource approaches to management

Management 10/e - Chapter 2 14

Study Question 2: What insights come from the
behavioral management approaches?

 Behavioral Management - human

resource approaches include:
 Hawthorne studies

 Maslow’s theory of human needs

 McGregor’s Theory X and Theory Y

 Argyris’s theory of adult personality

Management 10/e - Chapter 2 15

Study Question 2: What insights come from the
behavioral management approaches?

 Hawthorne studies
 Initial study examined how economic
incentives and physical conditions
affected worker output.
 No consistent relationship found.
 “Psychological factors” influenced
results.

Management 10/e - Chapter 2 16

Study Question 2: What insights come from the
behavioral management approaches?

 Hawthorne studies (cont.)

 Relay assembly test-room studies
 Manipulated physical work conditions to
assess impact on output.
 Designed to minimize the “psychological

factors” of previous experiment.

 Factors that accounted for increased

productivity:
 Group atmosphere
 Participative supervision

Management 10/e - Chapter 2 17

Study Question 2: What insights come from the
behavioral management approaches?

 Hawthorne studies (cont.)

 Employee attitudes, interpersonal relations
and group processes.
 Some things satisfied some workers but not
others.
 People restricted output to adhere to group
norms.
 Lessons from the Hawthorne Studies:
 Social and human concerns are keys to
productivity.
 Hawthorne effect — people who are singled out
for special attention perform as expected.

Management 10/e - Chapter 2 18

Study Question 2: What insights come from the
behavioral management approaches?

 Maslow’s theory of human needs

 A need is a physiological or
psychological deficiency a person feels
compelled to satisfy.
 Need levels:
 Physiological
 Safety

 Social

 Esteem

 Self-actualization

Management 10/e - Chapter 2 19

Figure 2.3 Maslow’s hierarchy of human needs.

Management 10/e - Chapter 2 20

Study Question 2: What insights come from the
behavioral management approaches?

 Maslow’s theory of human needs

 Deficit principle
 A satisfied need is not a motivator of behavior.
 Progression principle
 A need becomes a motivator once the
preceding lower-level need is satisfied.
 Both principles cease to operate at self-
actualization level.

Management 10/e - Chapter 2 21

Study Question 2: What insights come from the
behavioral management approaches?

 McGregor’s  McGregor’s
Theory X Theory Y
assumes that assumes that
workers: workers are:
 Willing to work
 Dislike work  Capable of self
control
 Lack ambition  Willing to accept
 Are irresponsible responsibility
 Resist change  Imaginative and
creative
 Prefer to be led  Capable of self-
direction

Management 10/e - Chapter 2 22

 Study Question 2: What insights come from the
behavioral management approaches?

 Implications of Theory X and Theory Y:

 Managers create self-fulfilling prophecies.
 Theory X managers create situations
where workers become dependent and
reluctant.
 Theory Y managers create situations
where workers respond with initiative and
high performance.
 Central to notions of empowerment and self-
management.

Management 10/e - Chapter 2 23

Study Question 2: What insights come from the
behavioral management approaches?

 Argyris’s theory of adult personality

 Classical management principles and practices
inhibit worker maturation and are inconsistent
with the mature adult personality.
 Management practices should accommodate
the mature personality by:
 Increasing task responsibility
 Increasing task variety
 Using participative decision making

Management 10/e - Chapter 2 24

Study Question 3: What are the foundations of
modern management thinking?

 Foundations for continuing

developments in management
 Systems view of organizations
 Contingency thinking
 Commitment to quality and performance
 Learning organizations

Management 10/e - Chapter 2 25

Study Question 3: What are the foundations of
modern management thinking?

 Management science or operations

research
 The scientific applications of mathematical
techniques to management problems
 Mathematical forecasting makes future
projections useful for planning
 Inventory modeling controls inventories
mathematically
 Linear programming calculates how to allocate
scarce resources among competing uses

Management 10/e - Chapter 2 26

 Study Question 3: What are the foundations of
modern management thinking?

 Management science or operations

research
 Queuing theory allocates service personnel/workstations
to minimize service cost and customer waiting time
 Network models break large tasks into smaller
components for for better coordination
 Simulations create problem models to test different
solutions
 Operations management is the study of how
organizations produce goods and services

Management 10/e - Chapter 2 27

Study Question 3: What are the foundations of
modern management thinking?

 Organizations as Systems
 System
 Collection of interrelated parts that function
together to achieve a common purpose.
 Subsystem
 A smaller component of a larger system.
 Open systems
 Organizations that interact with their
environments in the continual process of
transforming resource inputs into outputs.

Management 10/e - Chapter 2 28

Figure 2.4 Organizations as complex networks of
interacting subsystems.

Management 10/e - Chapter 2 29

Study Question 3: What are the foundations of
modern management thinking?

 Contingency thinking
 Tries to match managerial responses
with problems and opportunities unique
to different situations.
 Especially individual or environmental
differences.
 No “one best way” to manage.
 Appropriate way to manage depends on
the situation.

Management 10/e - Chapter 2 30

Study Question 3: What are the foundations of
modern management thinking?

 Quality and performance excellence

 Managers and workers in progressive
organizations are quality conscious.
 Quality and competitive advantage are
linked.
 Total quality management (TQM)
 Comprehensive approach to continuous
quality improvement for a total organization.
 Creates context for the value chain.

Management 10/e - Chapter 2 31

 Study Question 3: What are the foundations of
modern management thinking?

 Quality and performance excellence

 ISO certification
 Global quality benchmark.
 Refine and upgrade quality to meet ISO
standards
 Continuous improvement
 Continual search for new ways to improve
quality
 Something always can and should be improved
on

Management 10/e - Chapter 2 32

 Study Question 3: What are the foundations of
modern management thinking?

 Knowledge Management and

Organizational Learning
 Knowledge management is the process of
using intellectual capital for competitive
advantage
 Portfolio of intellectual assets include
patents, intellectual property rights, trade
secrets, and accumulated knowledge of the
entire workforce.

Management 10/e - Chapter 2 33

Study Question 3: What are the foundations of
modern management thinking?

 Learning organizations
• Organizations that are able to continually learn
and adapt to new circumstances.
• Core ingredients include:
 Mental models
 Personal mastery
 Systems thinking
 Shared vision
 Team learning

Management 10/e - Chapter 2 34

Study Question 3: What are the foundations of
modern management thinking?

 High Performance Organizations

• Organizations that consistently achieve excellence
while creating a high quality work environment.
• Common characteristics of high performance
organizations include:
 People oriented – value people as human
assets
 Team oriented – achieve synergy through
teamwork
 Information oriented – mobilizes the latest
information technology

Management 10/e - Chapter 2 35

Study Question 3: What are the foundations of
modern management thinking?

 High Performance Organizations

 Achievement oriented – focuses on the
needs of customers and stakeholders
 Learning oriented – operates with
internal culture that respects and
facilitates learning

Management 10/e - Chapter 2 36

 Study Question 3: What are the foundations of
modern management thinking?

 Evidence-Based Management
• Making management decisions on “hard facts” about
what really works

 Evidence-Based Positive Human

Resource Management Practices
• Employment security
• Selective hiring
• Self-managing teams
• High pay based on merit
• Training and development
• Reduced status distinctions
• Shared information

Management 10/e - Chapter 2 37

 COPYRIGHT

Copyright 2009 © John Wiley & Sons, Inc. All rights

reserved. Reproduction or translation of this work
beyond that named in Section 117 of the United States
Copyright Act without the express written permission of
the copyright owner is unlawful. Requests for further
information should be addressed to the Permissions
Department, John Wiley & Sons, Inc. The purchaser may
make back-up copies for his/her own use only and not for
distribution or resale. The Publisher assumes no
responsibility for errors, omissions, or damages, caused
by the use of these programs or from the use of the
information contained herein.