EVOLUTION OF MANAGEMENT THOUGHTS….

1. EVOLUTION OF MANAGEMENT THOUGHTS….

2. Major contributions…. • F W Taylor • Henry Fayol • Elton Mayo • Hawthorne Studies

3. Frederick W Taylor & Scientific Mgt. • Frederick W Taylor is regarded as “The Father of Scientific Management.” (Early 90’s) • He spent a large part of his life in Midvale Steel Company, USA, as an ordinary worker engaged in metal cutting. • He noticed that business enterprises were using the rule of thumb instead of systematic effort.

4. Taylor’s Philosophy • Science, not rule of thumb. • Harmony, not discord. • Co-operation, not individualism. • Maximum output, in place of restricted output. • The development of each man to his greatest efficiency and prosperity.

5. Principles/Elements of Scientific Mgt…. 1. Work Study: Work study is related to analysing the work to be performed by eliminating unnecessary operations and finding out the quicker way for doing it. 2. Standardisation of Tools & Equipments: Taylor wanted to do only ‘the best way of doing the work’. Proper tools & equipments are essential for increasing the efficiency and speed of work.

6. Principles/Elements of Scientific Mgt…. 3. Scientific Selection, Placement & Training: According to Taylor, workers should be selected by considering their education, experience and attitude towards work. Placement should be such that only most suitable person are assigned the work . Orientation training should also be imparted to the employees to meet the new challenges.

7. Principles/Elements of Scientific Mgt…. 4. Development of Functional Foremanship: Functional foremanship is the extension of the principle of specialisation or division of labour. 5. Introducing Costing System: Scientific management also introduced an efficient system of cost accounting. It is a technique to calculate cost per unit and total cost of production.

8. Principles/Elements of Scientific Mgt…. 6. Mental Revolution: Mental revolution is concerned with bringing basic change in the mental attitude of workers and management towards each other.

9. Henry Fayol (1841-1925) & Administrative Management • Fayol started his career as a junior engineer in a coal mine company in France and then became general manager. • His famous published book was General and Industrial Management in 1929. • He has given 14 principles of management.

10. Fayol’s principles of management…. • Division of work: The object of division of work is to derive the benefits from the principles of specialisation. • Authority & Responsibility: Authority is the right to give orders and power. Its exercise must be accompanied by reward and penalty, and must carry with it responsibility. Responsibility is a natural consequence of authority.

11. Fayol’s principles of management…. 3. Discipline: According to Fayol, discipline is obedience, application, energy and outward marks of respect. He considered discipline as absolutely essential for the smooth running of business. 4. Unity of Command: Fayol warned that in all human associations, “dual command is a perpetual source of conflict.” Dual command creates havoc in the organisation. So, an employee should receive orders from one superior only.

12. Fayol’s principles of management…. 5. Unity of Direction: The principles of Fayol is that ‘there should be one head and one plan’ for a group of activities having the same objectives. “A body with two heads is in the social sphere a monster and has difficulty in surviving.”

13. Fayol’s principles of management…. 6. Subordination of Individual Interest to General Interest: Common interest is above the individual interest and when there is a conflict between the two, common interest must prevail.

14. Fayol’s principles of management…. 7. Remuneration to Personnel: A contented staff is a solid asset to the management. Remuneration should enable the employees to lead a satisfactory life and in addition offer special incentives to those who are more versatile or meritorious. (Monetary & Non Monetary)

15. Fayol’s principles of management…. 8.Centralisation: Question of centralisation and decentralisation is a simple question of proportion. Small concerns have absolute centralisation because the management orders go directly to employees. But in large companies, there is less degree of centralisation, since a manager’s orders pass through a number of levels and intermediaries to reach the operators.

16. Fayol’s principles of management…. 9. Scalar Chain: According to Fayol, scalar chain is “the chain of superiors” ranging from the ultimate authority to the lowest ranks. Communication should be free flow to avoid problems. 10. Order: By order, Fayol meant a place for everyone and everyone in his/her place. He also stressed on the scientific selection of competent personnel and bring about correct assignment of duties to the respective persons.

17. Fayol’s principles of management…. 11.Equity: A manager should strive to install a “sense of equity” through out all levels of scalar chain. prejudices, personal likes or dislikes should be avoided by the management. 12. Stability of Tenure of Personnel: No employee should be removed within a short period of time. Frequent change should be avoided. According to Fayol, “Time is required for an employee to get used to new work and succeed in doing it well.”

18. Fayol’s principles of management…. 13. Initiative: Initiative is concerned with thinking out and execution of a plan. It becomes a source of strength in different situations and is desirable because of psychological effects on the individuals.

19. Fayol’s principles of management…. • 14. Espirit De Corps (Team Spirit): This is the principle of ‘unity is srtength’. The phrase Espirit De Corps means the spirit of loyality and devotion which unites the members of a group.

20. Elton Mayo & Human Relations Approach (1880-1949) • Elton Mayo was originally a medical student but developed interest in psychology and philosophy. • He considered human beings as a focus of the management action. • He is the founder of Human Relations Approach.

21. Hawthorne Experiment • Elton Mayo and his associates conducted Hawthorne studies between 1927-1932 at the Hawthorne plant of Western Electric Company near Chicago in USA. • The initial objective was to examine the effect of fatigue on workers but this was greatly extended to evaluate attitudes and psychological reaction of the workers in on the job situations.

22. 4 Phases of the experiments: • Illumination Experiments (Phase I): This experiment was conducted to observe the effect of illumination on two group of employees making telephone relays. • In one group, intensity of light was changed whereas in other group, the illumination (light) was kept constant. • Surprisingly, the result concluded that illumination was not the cause of low productivity.

23. This phase lasted for two and a half years. Then, the researchers concluded that certain other factors might be responsible for low productivity, therefore, second phase of experiments was undertaken.

24. 2. Relay Assembly Test Group (Phase II): In this experiment, two groups of six female telephone relay assemblers were put under observation in separate rooms. • Each room was known as ‘Relay Assembly Test Room’. • in one room(Test Room), a no of experiments were made over a period of two years. • Whereas, in the second room(Control Room) no changes were made.

25. The following changes were made in the test room: • Rest Pauses: over a period of two years, rest periods changes were made as follows: • One 5 min rest: One rest pause in the morning session. Subsequently, the time was increased to 10 min. there was increase in the production in this group.

26. Six 5 min rests: The output decreased slightly when six 5 min rest pauses were introduced. • Two rest pauses of 10 min: The workers were served snacks with coffee or soup in the rest periods. The output recorded an increase.

27. b. Changes in week days and working hours: The decrease in working hours by one hour led to an increase in production. • When five days week was tried (Sat off), the production increased and absenteeism reduced. • After some time the original schedule was reinforced and production went up still higher. • Researchers concluded that increase in output was not due to changes in physical factors but on account of positive attitude of girls and feeling of sense of responsibility.

28. c. Change in Incentive System: Workers of test room were offered financial incentives for increased production and the output went up. d. Changes in Work: Workers were consulted before making the changes and the work was also simplified.

29. The result of this special attention and recognition caused them to carry a feeling of group pride and belongingness. • At this stage, the researchers were interested to know that why the attitudes of the employees had became positive after participating in the Test Room.

30. 3. Interviewing Programme (Phase III): Mayo initiated a three year long interviewing programme and covered more than 21,000 employees to find out the reasons for increase in production. • When the questions were asked directly most of the employees did not answer properly. • But, when indirect interviews were taken, there came a difference. • For the first time, the importance of informal groups was recognised.

31. 4. Bank Wiring Observation Room Experiment (Phase IV): These experiments were conducted to find the impact of small groups on the individuals. • In this experiment, a group of 14 male workers were formed. • Their work was to attach wires to the switches. • Hourly wage for each worker was fixed on the basis of average output of each worker.

32. Bonus was also payable on the basis of group effort. • The workers cited various reasons for a collaborative effort. (fear of unemployment, fear of output and desire to protect slow workers) • This experiment clearly showed that a man at work is motivated by more than the satisfaction of economic needs.

33. Management should recognise that people are essentially being social beings and economic beings. • As a social being, they are members of a group and the management should try o understand group attitudes and group psychology.

34. Conclusions drawn by Prof. Mayo • Social Unit • Group Influence • Group Behaviour • Motivation • Supervision • Working Conditions • Employee Morale • Communication • Balanced Approach

35. Mayo’s Contribution to the Development of Management thought • Father of human relations approach • Non economic awards • Social man • Organisation as a social system

36. THAT’S ALL FOR TODAY