The Evolution of Management Theory

1. 2 The Evolution of Management Theory 1 History Background 2 Evolution of the theory 3 Contingency Management 王青-管理学院-上海交通大学

2. Evolution of Management Theory Figure 2.1 Org. Environment Management Science Behavioral Management Administrative Management Scientific Management 1940 2000 1890 王青-管理学院-上海交通大学

3. History Background • Industrial revolution in 18th century in Great Britain. • Machinery was changing the way goods were produced. • Managers had to increase the efficiency of the worker-task mix. • Organizations were seeking ways to better satisfy customer needs. 王青-管理学院-上海交通大学

4. Division of labor“the wealth of nation”(1776) • Adam Smith, 18th century economist, found firms manufactured pins in two ways: • Craft -- each worker did all steps. • Factory -- each worker specialized in one step. • Smith found that the factory method had much higher productivity. 王青-管理学院-上海交通大学

5. 工序：拔丝、矫直、切段、敲针头、磨针尖、焊接。工序：拔丝、矫直、切段、敲针头、磨针尖、焊接。 分工前——200根/人 分工后——48，000根/10人 4，800根/人 24倍 王青-管理学院-上海交通大学

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7. Scientific Management CASE • Defined by Frederick Taylor, late 1800’s. • 1911 “Principles of Scientific Management” • the books publication established Taylor as the “father” of scientific management. • Contribution to Management • The 5 Principles • Valid of Scientific Management 王青-管理学院-上海交通大学

8. Contribution to Management • Rise the labor productivity • Rise the managerial efficiency • The systematic study of the relationships between people and tasks to redesign the work for higher efficiency. 王青-管理学院-上海交通大学

9. The 5 Principles • Four Principles to increase efficiency: 1. Study the way the job is performed & determine new ways to do it. Codify the new method into rules. 2. Select workers whose skills match the rules set in Step 1. 3. Establish a fair level of performance and pay for higher performance. 4.Divided work and managers take over all work for which it is better fit than workers. 5. Empowerment and Daily Control. 王青-管理学院-上海交通大学

10. CASE UPS 美国联合邮包公司 王青-管理学院-上海交通大学

11. Valid of the Scientific Management • The Scientific Management only suite to the enterprise which production is highly labor intensive. • Workers could purposely “under-perform”.Management responded with increased use of machines. 王青-管理学院-上海交通大学

12. Administrative Management • Henri Fayol developed the concept of business & the principles of management. • 14 principles of management. • Developed the business activities as 6 sections & 4 managerial functions. 王青-管理学院-上海交通大学

13. Business activities Business Activities Production Distribution Management Business Activities Accounting Finance Technology 王青-管理学院-上海交通大学

14. Fayol’s Principles • Henri Fayol, developed a set of 14 principles: 1. Division of Labor:allows for job specialization. 2. Authority and Responsibility:Fayol included both formal and informal authority resulting from special expertise. 3. Unity of Command:Employees should have only one boss. 4. Unity of Direction:One plan of action to guide the organization 5. Centralization:the degree to which authority rests at the very top. 王青-管理学院-上海交通大学

15. Fayol’s Principles 6.. Line of Authority:a clear chain from top to bottom of the firm. 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:obedient, applied, respectful employees needed. 王青-管理学院-上海交通大学

16. Fayol’s Principles 11. Remuneration of Personnel:The payment system contributes to success. 12. Stability of Tenure:Long-term employment is important. 13. General interest over individual interest:The organization takes precedence over the individual. 14. Esprit de corps:Share enthusiasm or devotion to the organization. 王青-管理学院-上海交通大学

17. Behavioral Management • Focuses on the way a manager should personally manage to motivate employees. • A professor from Harvard named Elton Mayo takes charge of theHawthorne Studies. • Established the “Human Relationship” theory. 王青-管理学院-上海交通大学

18. The Hawthorne Studies • Study of worker efficiency at the Hawthorne Works of the Western Electric Co. during 1924-1932. • Step one: Lighting intensity experiment. • Step two: Relayassembly experiment. • Step three: Conversation studies • step four: Observation experiment 王青-管理学院-上海交通大学

19. Lighting intensity experiment • Worker productivity was measured at various levels of light illumination. • Researchers found that regardless of whether the light levels were raised or lowered, productivity rose. • Conclusion :It appears that the workers enjoyed the attention they received as part of the study and were more productive. 王青-管理学院-上海交通大学

20. Relay assembly experiment • Change the situation of work, the productivity rose. • After the situation removed ,the productivity still kept high. • Conclusion : Find that the change of the situation can affect the workers` attitude to their jobs , then influence their output. 王青-管理学院-上海交通大学

21. Conversation studies • During two years Meyo talked with 20,000 staffs about their jobs. • Find there are many informal groups in formal organization . • Group influences significantly affected individual behavior； 王青-管理学院-上海交通大学

22. Observation experiment • Meyo observed the productivity of several work-groups, every group was a small organization with 14 workers . • Find social norms or standard of group usually affect individual action. • Group standards established individual worker output； 王青-管理学院-上海交通大学

23. Management Science • Uses rigorous quantitative techniques to maximize resources. Quantitative management:utilizes linear programming, modeling, simulation systems. Operations management:techniques to analyze all aspects of the production system. Total Quality Management (TQM):focuses on improved quality. Management Information Systems (MIS):provides information about the organization. 王青-管理学院-上海交通大学

24. Organization-Environment Theory • Considers relationships inside and outside the organization. • The environment consists of forces, conditions, and influences outside the organization, and it will affect the organization`s performance. Details in Chapter 3 王青-管理学院-上海交通大学

25. Contingency Theory • Assumes there is no one best way to manage. • The environment impacts the organization and managers must be flexible to react to environmental changes. • The way the organization is designed, control systems selected, depend on the environment. • Details in chapter 7 王青-管理学院-上海交通大学