Introduction

ORGANIZATION
AND
MANAGEMENT
Evolution of Management Theory
LEARNING OBJECTIVES
To understand on how management
theory evolve from time to time.

To understand the different

management theories.
 The approach to the management of
organizations starts on some theories which
are considered the tools of management in
attaining its goal most effectively.
 “Without theories, all we can have are
intuition, hunches, and hope, which are of
limited use in today’s increasingly complex
organizations”.

-James A. F. Stoner
Management Theories

Tools to increase the

effectiveness of
managers.
 “The manager who is up-to-date on
existing management theories will be
more likely to remain up-to-date on
management practices.”

-James A.F. Stoner

Building of Egyptian Pyramids and Great Wall
of China

City of Venice

Publication of the “The Wealth of Nations” by

Adam Smith

Emergence of Industrial Revolution

EARLY MANAGEMENT PRACTICES

 How do you think they came up into a great
structure without people who build it?

Who manage these people?

Building of Egyptian Pyramids and Great Wall of China

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Publication of the “The Wealth of
Nations”

By Adam Smith in 1776

He argued the economic advantages that

organizations and society would gain from the
concept of division of labor (job specialization).
Emergence of Industrial
Revolution

Starting in the 18th century

when machine power was
substituted for human power.
Managem •Universal
ent •Dynamic
Any period in its evolution involves an interface of segments that cannot
be divided or separated in different aspects.

This means that each period is a part of the development and evolution
of the other.
The specific phase of management that we will discuss here are just
highlights of events during various periods.
 Organization and management have
existed over thousands years of years ago.
Earliest forms of civilization during ancient
times were able to build structures,
shelters, bridges and tools by a group of
people out of available resources and led
by good management.
Let’s Take a Look
 It is defined as the use of
scientific method to
determine the “one best way”
for a job to be done.

1. Scientific Management
 The result of
management’s effort to
increase the productivity of
the organization.

1. Scientific Management
Scientific Management
Frederick W. Taylor is the most significant author of
this field.

-Father of Scientific
Management
 Using his scientific management principles, Taylor was
able to define the “one best way” for doing each job.

Taylor made a scientific study of workers, machines, and

the workplace by using the method of standardization of
parts, uniformity of work structure and the assembly line.
 •When Frederick W.
Taylor’s Principles of
1911 Scientific Management
was published.
The Gilbreth’s (Frank and Lillian )
One of the great husband and wife tandem
of science and engineering

Inspired by Taylor’s work and proceeded to

study and develop their methods of
scientific management.
 They devised a classification scheme to
label 17 basic hand motions called
THERBLIGS (derived from Gilbreth spelled
backward) to eliminate wasteful motions,
thereby, increasing productivity
 To date , scientific management
continues to be the foundation and basis
for continuous improvement in
productivity and efficiency regarding
quality and cost.
Administrative Management Theory
 The theorists who emerged in this group
focused more on the entire organizations by
developing general theories of what managers
do and what comprised well management
practice.
 Administrative Management

It focuses on formal organization

structure and the delineation of the basic
processes of general management.

-Kast &Rosenweig
Administrative Management
Vs.
Scientific Management
 Administrative
Management

Concerns itself with the

problems of managing
complex organizations
HENRI FAYOL
Leading French industrial, who
developed the 14 Principles of
management

Believes that management is not personal talent but a

skill

Believes that management can be taught, once its underlying

principles are understood and a general theory of management
is formulated.
 Division Authorit Disciplin
of Work y e

Unity of Unity of
Direction Command
Subordinat
ion of
Individual Remuner Centraliz
interests to ation ation
the general
interests
Scalar
Order Chain

Stability of
Equity tenure of
personnel
Initiative
 Unity of •Every employee should receive
Command orders from only one superior.

Unity of •The organization should have a single plan

of action to guide managers and workers.
Direction
Subordination of •The interest of only one employee or group of
Individual interest to employees should not take precedence over
the general interest the interests of the organization as a whole.
Division of •Specialization increases output by
making employees more efficient.
Work
•Managers must be able to give orders,
Authority and authority give them this right.

•Employees must obey and respect the

Discipline rules that govern the organization
Remunerati •Workers must be paid a fair
on wage for their services

Centralizati •Refers to the degree to which

subordinates are involved in decision-
on making

Scalar •The line authority from top management

to the lowest ranks is the scalar chain.
Chain
 •People and materials should be in
Order the right place at the right time

•Managers should be kind and

Equity fair to their subordinates

•Management should provide orderly

Stability of tenure
personnel planning and ensure that
of personnel replacements are available to fill vacancies.
 •Employees who are allowed to
Initiative originate and carry out plans
will exert high levels of effort

•Promoting team spirit will

Esprit de build harmony and unity
Corps within the organization.
 Postulating on Fayol’s principles,
Luther Gulick has developed the
famous POSDCORB ,an acronym
containing the first letter of seven
administrative activities.
 •Developing a broad outline of the activities to

Planning be carried out, the methods of execution so as

to accomplish the purpose set for the
enterprise;

Organizi •Establishment of the formal structure

and training staff and maintaining
ng favourable working conditions;

•Manning and keeping the

Staffing organization being manned;
 •The all-important duty of
Directing interrelating the various
parts of the work;

•The continuous task of leading the

Coordina enterprise by making decisions and
embodying them in specific and
ting general orders and instructions;
 •Encouraging fiscal
Reportin
planning, accounting and
g control.

Budgetin •Keeping superiors informed of

the status of the work through
g reports and records; and
MAX WEBER Another proponent of General
Administrative Theory

German Sociologist and considered

“Father of Bureaucracy”
 Max Weber

His ideal form of an

organization focused on what
is known as bureaucracy.
 BUREAUCRACY
Ideal type of organization that is characterized by the ff:

Division of Clearly defined

Labor hierarchy

Detailed rules Impersonal

 Weber recognized that this “ideal bureaucracy” didn’t exist in
reality. Instead he intended it as a basis for theorizing about how
work could be done in large groups.

Weber’s theory became the structural design for many of

today’s large organizations.
BEHAVIORAL MANAGEMENT THEORY
Behavioral Management Theory

Often called human relations movement.

Focuses on the human aspect of

work.
 During the 20 th century, management principles were
not able to address many management situations
specifi cally those that deals with human behavior. Theorist
then believed that a better understanding of human
behavior while at work, improved productivity and that
employees are not machines but are considered to be
valuable assets in the organization.

BEHAVIORAL MANAGEMENT THEORY

 cd
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ELTON MAYO i
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 The first experiment tested the relationship of lighting
levels to worker productivity.

The result showed that lighting has no effect on the

increase or decrease of effort an employee exerts. Whether
there is good lighting condition or not, the productivity of
employees remains the same as they know what they are
being observed.
 A few years later, Mayo and his team conducted
another experiment and this time they supervised five
group of women in a bank wiring room. They gave these
women special attention and privileges such as take rest
intervals, leave the workplace without asking
permissions and give incentives such as free lunches and
day offs on special occasions. This experiment notably
increased production rates.
 Mayo concluded out of his experiment that
change of lighting does not have anything to do with
productivity, but rather the supervisory tasks are given
to these five women empowered them to work harder.
As pioneers of the experiments, they became primary
supervisors as they set an example and influenced the
work attitude of the employees under their
supervision.
This experiment became known as the Hawthorne Effect.

Hawthorne effect

Stresses the human relations

and social needs of workers as
crucial aspects of management.
 American
Psychologist

Created the
Hierarchy of
Needs

ABRAHAM MASLOW (1908-1970)

Maslow’s Hierarchy of
A theory based on his assumptions of the
Needs human needs:

Human needs are never

completely satisfied.

Human behavior is purposeful

and is motivated by the need
for satisfaction

Needs can be classified

according to hierarchical
structures of importance from
the lowest to highest.
MASLOW’S HIERACHY OF NEEDS
THEORY

Helped managers to understand,

visualize and create employee
motivation.
Physiologic •This pertains to all physical needs necessary
for the maintenance of human well-being,

al Needs such as food, clothing and shelter.

Safety •These requirements include the need for

basic security, stability, and protection.
Once these needs are satisfied, they can
Needs accomplish more.
Belonging and •The need for friendship, family,
belongingness became a primary motivator.
Love needs
Esteem •Self-esteem, confidence,, achievement,
respect, fame and glory
Needs
Self-Actualization •After all the needs have been satisfied, an
needs individual feels the need of finding himself.
 MANAGEMENT
SCIENCE THEORY
Manageme •Known as the
Quantitative
nt Science Approach to
Theory Management
Management Science Theory

Uses quantitative techniques

in decision-making.

This approach includes applications of

statistics, optimization models, information
models and computer simulations.
Management Science Theory

Originated during World War II as

mathematical, and statistical solutions to
military problems were developed for wartime
use.

Contributes to managerial decision-

making, particularly in planning and
controlling.
ORGANIZATIONAL
ENVIRONMENT
THEORY
 By late 1960’s, theorists recognized that
human factor alone is not a consideration to
achieve organizational effectiveness. They
understood that an organization is a part of a
larger environment outside its boundaries and is
affected by social, technical and economic factors
which are in a form of a systems perspectives
based on physical sciences.
There are two basic types of systems:

Open

Interacts with its

environment
 Knowing and using these systems
approach will approach will help managers
visualize the Organization as a whole and
would help in coordinating the work activities
as one. Realizing that decisions, actions and
plans taken will affect the entire organization.
Questions?