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Chapter Two: THE EMERGENCE AND DEVELOPMENT OF

MANAGEMENT THOUGHT

2.1. Introduction
The formal study of management theory is the result of the twentieth century. And different
contributors contributed their share to management theory as a separate discipline.

2.2. The Early Management Pioneers

The following are some of the early management pioneers who contributed for the development of
management.

Robert Owen (1771-1858)

Working as a manager of Cotton Mills Company in Scotland, Robert Owen was concerned about
the poor working and living conditions of workers. As a result, he placed great importance on
ensuring that the living machine should be treated with kindness and sufficiently supplied with the
necessities of life. As a result he:
 tried to improve the working conditions in his factory;
 provided meal, housing and marketing facilities to the employees in the factory;
 reduced the working hour from 13 to 101/2 hours; and
 refused to hire children below-the age of 10 years.

Charles Babbage (1792-1871)

Babbage was a mathematician and is best remembered as the inventor of the ‘analytical machine’
which was the forerunner of the modern computer. His contributions to management are:-
 He stressed the importance of division of labour on the basis of skills.
 He emphasized the necessity of replacing the manual operations by machines.
 He laid down the foundation for formulating scientific management.

Henry Robinson Towne (1844-1924)

Towne was a founder and manager of yale and Towne manufacturing company. He has succeeded
in motivating the engineers to study management. According to him, a manager should be:
 an administrator;
 an engineer; and
 a thorough statistician

Thus, he wanted to see these three people in a single person-called manager. Towne emphasizes
that this combination of qualities, together with at least some skill as an accountant, is essential to
the successful management of industrial work.

2.3. Forerunners of Modern Management

The prominent forerunners of modern management include: F.W Taylor, H.Fayol, Gilbreths,
Weber, H.L.Gantt, Elton Mayo,and other

1. Frederick Winslow Taylor (1856-1915)

Taylor realized that to expand productivity, ways and means had to be found to increase the
efficiency of workers. He observed certain factors which led to low productivity.

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Some of these factors were:
 incentive rate cutting by employers;
 poor methods of training;
 lack of standards of performance;
 lack of a spirit of cooperation on the part of both labor and management.
In an effort to address these problems, Taylor built the body of principles that now constitute the
essence of scientific management.
2. Henry Fayol (1841-1925)
Henry Fayol was a French engineer and geologist. While Taylor was interested in improving
worker and factory productivity, Henry Fayol was concerned with the executive managerial role.
Henry Fayol divided the activities of industrial organization in to six categories. These are:
a. Technical:- production and manufacturing.
b. Commercial:- buying, selling and exchange.
c. Financial:- identification and utilization of available funding.
d. Security:- protection of persons and properly.
e. Accounting:- stocktaking, preparation of balance sheet and statistical data.
f. Management:- planning, organizing, coordinating, commanding and controlling.
Fayol further developed fourteen principles of management, which will be separately discussed
later. He was considered as the father of administration process/management theory.

3. Henry Laurence Gantt (1861-1919)

Gantt was a prominent follower of Taylor. He was more interested than Taylor in the human
relations aspect of management. Gantt made four main contributions to the evolution of
management thought. These contributions are listed below.
(i) He invented a chart for comparing actual with planned performance. The device is now
called Gantt chart.
(ii) He devised a task bonus plan for paying workers. His plan paid workers a guaranteed
day wage for output less than standard, a bonus for meeting the standard, and an
additional reward for output above the standard.
(iii) He advocated that management has a responsibility to train workers to become more
skilled, develop better work habits and perform reliably.
(iv) He advanced the idea that business should concentrate on providing services, not on
making profit.
4. Frank and Lillian Gilbereth (1868-1924 and 1878-1972)
Frank and Lillian Gilbreth were a husband and wife team that further developed Taylor's ideas.
They were among the first to film workers in order to analyze motion sequences so that the most
efficient way for performing specific task could be learned. The Gilbreths advocated for the
development of people through better training, improved work methods, and better work
environment. Moreover, they found out that such incentives as pride, competition, and desire for
recognition are often as important as money, shorter hours, and promotions.

5. Max Weber (1864-1920)

Weber was a German Social Scientist. He wanted to frame a rigid form of organization to eliminate
inconsistencies, which lead to ineffectiveness. He emphasized the strict adherence of rules and
regulations in an organization. He was the advocate of bureaucratic organization. His theory of
bureaucracy will be discussed later.
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6. George Elton Mayo (1880-1949)
The classical writers viewed people as machines that could be motivated by financial incentives
alone. They ignored the behavioral aspects of people. It was Elton Mayo and his associates that
applied psychological approach to management for the first time. They found out that production is
affected by the desires, attitudes and feelings of the workers. According to Mayo, productivity
would be increased and efficient management could be realized through understanding of people.
He conducted the Hawthorne experiment focusing on the human behavior and discovered that
when workers are given special attention by management, the production is likely to increase
irrespective of the actual change of working condition. Consequently, he is regarded as the founder
and the father of behavioral approach.
2.3. Approaches to management thought
Different writers have provided different approaches or categorization schemes for studying
management. Accordingly, the study of management theories can be categorized into three broad
approaches which include:
Classical theories
 Neo-classical theories and
 Modern theories
2.3.1 Classical Management Theories
The term classical means something accepted traditionally or long established. The development of
the classical theory can be examined from the point of view of three different perspectives or
streams. These are:-
(i) Scientific management
(ii) Administrative theory
(iii) Bureaucratic theory
(i) Scientific Management: This perspective of classical approach to management concentrated on
the problems of lower level or supervisory management, dealing with the everyday problems of
managing the workforce. At the turn of the 20th century, business started expanding, creating new
products and markets. But labour was in short supply. There were two possibilities to solve the
problem:
(a) Substituting capital for labour, or
(b) Use the available labour more efficiently
The second solution, i.e. using the available labour more efficiently, was the concern of scientific
management.

Frederick Winslow Taylor was the founder of the scientific management school of thought. The
major theme of scientific management was that work could be studied scientifically. In other words,
Taylor realized that efficiency at work could be improved through careful 'scientific' analysis. He
advocated for the detailed study of each job to determine the "one best way" of organizing and
doing work. The primary emphasis was on the application of scientific methods to the solution of
managerial and organizational problems.
Taylor's fundamental concern was to find out ways and means to improve production efficiency.
According to him, if efficiency in production is enhanced, both the employers and the employees
will benefit.

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Taylor stressed that, workers and management need to consolidate their cooperation, and work
together for the attainment of common goals, in order to prosper. What he observed was however
the opposite. The relationship between workers and employers was poor. They were conflicting,
and this led to inefficiency. Lastly, Taylor suggested the following major reasons for the conflict
and inefficiency observed.
(i) Soldering by employees:- the workers deliberately delayed work for the fear that an
increase in productivity would expose them to unemployment. The employees were afraid
that their service would no longer be required if they complete the work early.
(ii) Defective management system: - the management based its managerial activities on
common sense, individual judgment, and traditional ways, and lacked a sense of mutual
cooperation.
(iii) Lack of understanding about what constitutes a 'fair day's work' and a 'fair day's pay' from
both the management and the works side.
(iv) Inefficient methods or work: - the system was not scientifically designed
(v) Lack of incentive (bonus) mechanisms
(vi) Poor methods of selection and training of workers.
In an effort to address these problems, Taylor built the body of principles that now constitute the
essence of scientific management. As a result he is considered as the 'father of scientific
management' and the theory is 'Taylorism'. The principles developed by Taylor are discussed here
under.
Principles of Scientific Management
i. Rules of Thumb should be substituted by scientific methods. Taylor advocated that the old
method of doing work should be replaced by scientific method. The nature of work performed
by each worker should be determined. This includes the allotment of fair works to each
employee, standardization of work, adoption of piece rate of payment system, and the like.
ii. Specialization should be Practiced. Taylor advocated the division of entire work into
managerial and non-managerial categories. He separated the planning function from
executive function. Before Taylor's period, both planning and executive function were
performed by the same person. Taylor emphasized that supervisors should do the planning
function, while the executive function be assigned to the workers alone. He believed that
vertical specialization would improve job performance.
iii. Proper selection and training should be done. Taylor emphasized the proper selection and
training of workers. He suggested that workers should be selected and provided with job
training. The management should find out the physical, educational and psychological
requirements of each job, and suitable person to each job.
iv. Harmony in group action- F.w Taylor advocated for peace and friendship in group action. He
stressed that, dissatisfaction of any worker should be avoided in the group action.
Dissatisfaction of workers can be avoided through the introduction of scientific selection,
training and strategic placement of workers.
v. Wage incentive should be utilized. According to Taylor, man is mechanical and as a result
motivated by economic benefits. Consequently, he proposed different piece rate systems, in
which a worker was paid in proportion to the amount he/she produced.

Moreover, Taylor and his associates like the Gilberths, have conducted many studies and
experiments to find out how workers could be more productive and/or efficient. The following are
some of the major studies carried out by Taylor and his followers.

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a. Motion study- is the study of relating to the movement of a machine operator and his machine
while performing a job. It is the art of determining the perfect movement necessary to perform a
given job by eliminating all unnecessary movements of machine operator and the machine.
b. Time study- is the art of determining how long it would take to perform a given element of
work or particular job.
c. Fatigue study- is the process of determining the working hours and resting hours of
employees to accomplish a given task.
Major contributions of Taylor
The following are the major contributions that Taylor made to the development of the principles of
scientific management.
i. The development of science of work i.e. finding out the one best way of doing a given work
through time, motion, and fatigue study.
ii. Scientific selection and prospecting development of the workforce.
iii. The constant and intimate cooperation’s of management and workers theory (process of
functional approach).
iv. The separation of planning function from executing function

II. Administrative Management theory

The administrative management theory was initiated by Henry Fayol. Fayol believed that
management is not personal talent, but a skill like any other fields. The Administrative
management theory has two major purposes:
 To identify the fundamental functions of management
 To develop basic principles of management that could guide the creation, design and
maintenance of large organization.
Fayol found out that the activities of every organization should be divided into six categories, as
indicated in the foregoing discussions. Fayol also developed 14 important principles of
management that are applied to all types of organizations. These principles are presented here after.

Fayol's 14 principles of management

1. Principle of Division of work: Division of work makes a man specialist. Spec ialization leads
to better efficiency and maximum output. It also avoids wastage of time. According to Fayol,
division of work is applied to both technical and managerial kinds of work.
2. Principle of Authority and Responsibility: Authority is the right to command to get the work
done. On the other hand, responsibility is the accountability of authority so that the official
authority is not misused. Thus, responsibility is the natural outcome of authority.
3. The principle of Discipline: It suggests that, all people in an organization should respect the
rules that govern the organization, and those stated in the employment agreement. Fayol
further states that, these rules and agreements should be clearly defined and understood, and
enforced fairly and judiciously.

4. Principle of Unity of Command: This principle suggests that every one should have only one
superior, and each subordinate is responsible to only one superior. Otherwise, conflict and
confusion in authority and instruction would arise.
5. The Principle of Unity of Direction: This principle of Fayol states that "there should be one
head and one plan" for a group of activities having the same objective. For example, the
personnel department should have only one personnel manager, with a specified plan for a

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group of activities having the same objective. For Fayol, this principle is necessary for unity of
action, coordination of strength, and focusing on effort.
6. Principle of Subordination of Individuals Interest to Organizational (General) Interest: H.
Fayol expected the reconciliation of the individual interest with the organizational interest.
While the individual interests should be integral with organizational interest as much as
possible, the organization must take priority over the interest of an individual or a particular
group, where there is a conflict between the two.
7. Principle of Remuneration of Employees. Remuneration and method of payment should be
fair and afford the maximum possible satisfaction to employees and employer.
8. Principle of Centralization: Centralization means, the authority is concentrated at the upper
level. Decentralization refers to the delegation of authority downward. Fayol believed that
while some authority should be given to the subordinates to make decisions, all major
decisions should be made at the top management.
9. Principle of Scalar Chain: Scalar chain is the chain of superiors ranging from the top
management to the lowest level in the organization. However, this is proved to be very time
consuming, in case when people in different departments but at the same level of hierarchy,
needed to communicate with each other. Fayol solved this problem by introducing the
Gangplank-policy, which states such people could communicate with each other directly, but
with the permission of superior.
10. Principle of Order: Both materials and people must be well chosen, well placed, and well
organized for a smooth-running of an organization; For material things "A place for every
thing and everything in its place". For people, "A place for everybody, and everybody in
his/her place".
11. Principle of Equity: Equity refers to combination of fairness, kindness and justice. These will
encourage employees to work well and be loyal. Therefore, all the employees of the
organization should be treated equally by the managers.
12. Principle of Stability of Tenure of Employees: Employees turnover should be discouraged or
minimized. Tenure and long-term commitment should be encouraged. A person needs time
to adjust himself with the new work. Hence, employees and managers must have job security.
The managerial personnel in particular should be stable.
13. Principle of Initiative. Thinking out a plan and carrying it out successfully can be satisfying. Therefore,
subordinates must be encouraged to initiate new ideas and carry out their plans.
14. Principle of Esprit de Corps (Spirit of coordination). This is the principle “Union is strength”.
All the employees of the organization are put together as team, in order to achieve the objective
of the organization. It implies that teamwork, team spirit and togetherness must be developed
and maintained.
III. Bureaucratic Theory
The chief advocate of the bureaucratic organization was Max weber. To Weber, a pure form of
organization is characterized by rationality and impersonality. Rationality implies goal
directedness. Impersonality implies objectivity in interpersonal relations. Human resource decisions
in bureaucracies were to be strictly impartial based on qualification and work demands rather than
on caste system in the personal preference of decision makes.

According to Weber, bureaucracies are goal-oriented organizations designed according to rational

principles, in order to efficiently attain their goals.

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Common Features (Characteristics) of Bureaucracy
 Hierarchy of Authority Stable and clearly defined authority is needed to ensure clear authority
responsibility relationship, and to give commands for proper discharge of duties at various
levels.
 Specialized division of labour- tasks are divided into very specialized jobs.
 Written rules of conduct-rigorous set of rules must be followed to insure predictability and
eliminate uncertainty in task performance.
 Impersonality _ superiors take on impersonal attitude in dealing with subordinates.
 Promotion based on achievement- employment and promotion based on merit and technical
competence.
 Record Keeping- every decision and action is taken only after writing in a number of
documents.
 Efficiency -

Advantages and Disadvantage of Bureaucracy- Some of the advantages of bureaucracy are

precision, speed, unambiguity, knowledge of the files, unity, strict subordination, reduction of
friction and of material and personnel costs.

Some of the drawbacks of bureaucracy are:

 Rigidity of rules, regulations and procedures;
 Failure of cooperation and coordination;
 Displacement of goals; and
 Red tape (excessive procedure).

Contributions of the Classical Management Approach

The greatest contribution of the classical approach was that, it identified management as an
important element of organized society. Management has increased in importance. The
identification of management functions such as planning organizing and controlling provided the
basis for training new managers.

Moreover, many management techniques used today are direct outgrowth of the classical approach.
For instance, time and motion analysis, work simplification, inccentive wage systems, production
scheduling, personnel testing, and budgeting are all techniques derived from the classical approach.
2.3.2. Neo – Classical Theories
The basis for Neo-classical theory is classical theory. Neo-classical theory modified, improved and
extended the classical theory. In the 1920s and 1930s, observers of business management began to
feel the incompleteness and shortsightedness in the scientific as well as the administrative
management movements. As can be realized from the foregoing discussions, the scientific
management movement analyzed the activities of workers, whereas the administrative
management writers focused on the activities of managers. Thus, the importance of the man
behind the machines and the importance of individual as well as group relationship in the work
place were never recognized.

Elton Mayo and his associates clearly pointed out that workers should not be treated as mere
factors of production but should be treated as human beings. Elton Mayo emphasized that workers
attitudes, feelings and needs are extremely important on the job. His famous study of the
Hawthorhe plant (Western Electric) located in USA, laid the foundation for the human dimension
in organization.

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Some writers classify Neo-classical theories into two branches, namely, the human relations
approach and the behavioral science approach. These approaches are briefly discussed here
under.

2.3.2.1. The Human Relations Approach

The human relations approach became very popular in the 1940s and 1950s. It refers to the manner
in which managers interact with subordinates. According to the followers of this approach, to
develop good relations, managers must know why their subordinates behave as they do and what
psychological and social factors influence them. The concentration of scientific management was on
the physical environment of the job, whereas human relations concentrated on the social
environment. Elton Mayo is the founder of the human relations approach. Mayo and his
associates conducted the Hawthorne studies in a number of different stages and these studies
contributed to the evolvement of the human relations approach.

Discuss the five stages of the Hawthorne studies, emphasizing the purpose and the findings of each study!

The Major Conclusions of the Hawthorne studies

The following are the major conclusions of the Hawthorne study.
i. Individual workers must be seen as members of a group. They should not be treated in
isolation.
ii. The need to belong to a group and have status within it is more important than monetary
incentives or good physical working conditions.
iii. Informal groups at work exercise a strong influence over the behavior of workers.
iv. Superiors and/or managers need to be aware of the social needs of workers and cater for
them, if workers are to collaborate with the official organization rather than work against it.
It is worthwhile to note here that prior to the Hawthorne studies no consideration was given to the
importance of the human factor or it was overlooked. What is peculiar of Mayo and his associates
is that, they underscored the need for greater and deeper understanding of the social and
behavioral aspects of management.

2.3.2.2. The Behavioral Science Approach

Individuals who studied to the social sciences such as psychology, sociology, and anthropology
began studying people at work. The approach of these scholars was considered to be distinct from
the human relations approach in that, they applied the scientific approach to the study of human
behavior. Behavioral scientists underscored that individuals are motivated to work for various
reasons in addition to making money and forming social relationships. They concentrated on the
nature of the work itself, and the degree to which it can fulfill the human need to use skills and
abilities.

Contributions and Limitations of Neo – Classical Theory

Contributions:
The Neo – Classical approach has contributed a lot in developing important ideas and carrying out
research undertakings in the people managing aspect of the discipline of management. The basic
rational is that, since management must get work done through others, management is really
applied behavioral science. The point is that a manager must motivate, lead, and understand
interpersonal relations.

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Limitations
The basic assumption that managers must know how to deal with people appears valid. But
management is more than applied behavioral science. For the behavioral approach to be useful to
managers, it must help them in problem solving situations and make them better practitioners of
the process of management.

2.3.3. Modern Management Theories

Modern management theories indicate further refinement, extension and synthesis of all the
classical and neo-classical approaches to management. The concern of the classical approach was to
satisfy the basic economic needs of the organization and the society. Neo – classical approach
emphasized the satisfaction of personal security and the social needs of workers. Both approaches
need to be suitably integrated to emphasize the need for the recognition of human values and the
need for productivity as well.

Some writers classify the modern management theory into three streams. These include:
i. The Quantitative / Management Science Approach,
ii. The Decision Theory Approach,
iii. The Systems approach, and
iv. The Contingency approach.

2.3.3.1. The Quantitative Approach

The quantitative approach is also known as the mathematical, operation research or the
management science approach. According to the proponents of this approach, since managing is a
logical and rational process, it can be expressed in terms of mathematical relationships and models.
This will lend exactness to management process and substitute certainty for guesswork, knowledge
for judgment and hard facts for experience.

The management scientists introduced various mathematical tools for solving problems of
management in the areas of-quality control, inventory control, warehouse operations, resource
allocation, etc. However, the management scientists didn’t contribute to the theory of management
except that they made mathematical tools available to practitioners of management.

2.3.3.2. The Decision Theory Approach

The decision theory approach looks upon the management process as a decision making process.
According to the decision theorists, the entire field of management can be studied from the study of
the decision-making process, since the performance of various management functions involves
decision-making.

It is true that every task of the manager involves decision-making. The totality of management is
however, something more than decision making. The core tasks of the modern manager are
innovating, integrating the organization with its external environment, and creation of an
organizational climate which is conducive to the optimum performance of its members.

2.3.3.3. The System Approach

The system approach to organization and management emerged in the 1950s. The contributors of
this theory include; Ludwig Von Bertalanffy, Lawrence J. Henderson, H.G, Scott, Daniel Katz,
Rober L. Khan, etc. These theorists viewed organization as an organic and open system composed
of interacting and interdependent parts, called sub-systems. The systems approach to management
views the elements of an organization as interconnected. The approach moreover views the
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organization as linked to its environment. The point is that, organizational effectiveness and
survival depends on the organization’s interaction with its environment.
The following are some of the features of the systems theory:
System: - It is a set of interrelated parts that work together to achieve an objective. A Company, a
University and the Human body are examples of systems.

Sub-system: - is a set of related parts that work together to achieve an objective as one component
of a large system. For example, the human body’s circulatory system, nervous system, respiratory
system etc. are sub-systems of the human body.

Open and Closed Systems: A system can be open or closed. Open systems are those systems,
which interact with the external environment. They take inputs from the outside environment for
survival. Closed systems are systems which do not interact with the outside environment. They
don’t take inputs from the environment.

Input – Transformation – Output Model: An open system receives inputs such as money,
material, personnel, and technology from its environment and transforms them into outputs such as
goods and services, interacting with environmental variables.

System Boundary: The part of the system that separates the system from the environment and
filters the inputs going to the system, and the outputs that go out of the system.

System Goals: – Organizations have a variety of goals. The major goal of an organization is
survival. All other goals depend on the achievement of this one goal.

Feed-back: – Business systems have inherent feed-back mechanisms that provide various types of
useful information to management. Management makes use of the information in controlling the
performance at different stages of work. Feed-back also helps to improve the quality of the
products manufactured and the services redered by a given organization.
Psychosocial system: – A business organization is a psychosocial system in the sense that people
working in a firm develop social relationship and they constantly interact with one another.

Creativity: – Business is creative in that it fruitfully converts the available resources into useful
products.
Interdependence – Various sub-systems of a business system are interdependent and interacting.
Different departments are interlinked in one way or another to achieve specified goals.
Interdependence also exists between various firms and/or industries.

INPUTS TRANSORMATION (THROUGH-PUT) OUT PUTS

- Human - Product
– Systems

Organizational Environmental
Boundary

resources Variables Variables - Service

- Money - Methods - Economic s
Sub

- Materials - Processes conditions - Profits

System

- Objectives - Actions of
- Knowledge - Policies competitions - Educati
- Energy - Decisions - Union on
Activity
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Management know –how and technology

transforms inputs

Feed-back

Schematic Model for system

Systems have five basic characteristics, which include the following:
i) They consist of a set of components.
ii) They have identifiable boundary.
iii) There is an input-throughput – output relationship.
iv) They have a purpose to accomplish.
v) They are made up of sub-systems.

2.3.3.4. The Contingency Theory Approach

The Contingency theory was mainly developed in the 1970s. One of the important contribution of
the contingency perspective may best be summed up in the statement that ‘There is no one best
way to manage’. According to this approach, the best way to conduct managerial activities varies
with the situation. In some situations, manager’s best approach to a subordinate may be directive
and dictatorial; in others a sympathetic and democratic approach may be appropriate. Thus,
according to the contingency approach, managers must find different ways that fit different
situations. They must continually address themselves with the question “Which method will work
best here?” Applying the contingency (situational) approach requires that, mangers diagnose a
given situation and adapt to meet the conditions present.

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