CHAPTER - II

EVOLUTION OF MODERN MANAGEMENT THOUGHT

2.1 Introduction

2.2 Fredrick Winslow Taylor

2.3 George Elton Mayo

2.4 Hawthrone Experiments

2.5 Chester I. Bernard

2.6 Herbert Simon

2.7 Peter Dracker

2.8 Chris Agyris

2.9 Rensis Likert

2.10 Warren Bennis

2.11 Douglas McGregor

2.12 Limitations of Modem Management Approach

2.13 Corporate Excellence and Mahabhart

2.1 Introduction
This second chapter is devoted to the active the evolution of modem

management thought. It explains the background of modern management as a

separate subject of study. It reviews the trends in management thinking under

various schools. The thoughts of major thinker are separately discussed. Func­

tional decision & the process of management is explained.

Be it individual, family or farm; be it State, business or industry; be it art,

profession or administration, one aspires to attain a high degree of performance

and pursuit, this calls for productivity with peace and growth with harmony. And

these are encompassed by good management. If any single factor is the key

for unlocking the force of growth with prosperity, that factor is MANAGEMENT.

If achieved, production is indicative of material growth, and productivity a dynamic

condition facilitating acceleration of goods and services, but management can

serve as a ‘lever’ for higher life based on values, ethics and consciousness.

Production is increased by material incentives, says one School of Thought; it

is increased rather by the impulsion of political and social idealism, says another

School; but a third School maintains that it is the injection of sound management

based on consciousness - from within-to-without management - that stimulates

real prosperity.

Management has acquired steadily increasing importance as we

proceeded to modem industrialised society. Not only has modem industry grown

to be such a bewjlderingly octopus-organisation, it has also to be sustained by

equally complex collateral agencies of all kinds say for marketing the products,

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siphoning finance, maintaining public relations, recruiting labour-force, training

specialist-technicians and for conducting research towards newer arid still newer

products and processes of production or more and more attractive baits for the

avid consumerist society.

But management can have meaning only in relation to specified ends,

and the means available or mobilisable to achieve these ends. Given the ends

or goals, management must consist in assembling the means, organising them

to a condition of integral prosperity and effecting further improvements. These

ideas are by no means so novel as they may be made to sound. Our hoary

word Yoga’ could mean addition, the injection or introduction of ideas or

disciplines leading to a charging of power, a heightening of productivity and a

quickening or enlargement of results. Yoga could lead to Kshema, the

efflorescence of welfare. If work is worship, purposeful work could lead verily to

Realisation. There can be no planning, no productivity, no management, no

Loka Kshema, no Sarvodaya or sunrise of universal well-being without the

readiness of the people to work with a sense of common aims, a perceived

sense of common direction and a converging feeling of total dedication and

higher consciousness.

Vain indeed is all overweening pride in the conquest even of the entire

universe if one has not conquered one’s own passions.

Without the mastery of one’s own ego, the containment of the turbulent

enemy within, of what avail is the manipulation of mere techniques? Self and

self-management was the talk of Arnold Bennett’s popular guides. The physician

who can heal himself, the man who can master himself and manage efficiently

his own affairs, starts under right auspices when he sets out on the career of

others. Management Development cannot take place without Self-Development.

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 The history of trade commerce and industry is deeply related to the

development of modem management thought. In early days the business was

carried on a very small scale, the market was limited to a small area, the production

techniques were simple and scale of production very low. In India village was

the primary unit of the National economy. Agriculture was the main occupation.

Industry was agriculture oriented. In western countries also the situation was

not quiet different. Sole proprietorship and partnership were the commonly

accepted forms of business organisations. Due to the low scale of production

the capital requirement was also very low. The proprietor or the partner himself

used to manage the various functional affairs of the business.

Industrial revolution after the invention of steam engine by Jems Watt

brought revolutionary change in production techniques. Production shifted from

small scale to large scale, machines took the place of labour. Joint stock company

form of organisation came into existence, due to large capital requirement This

led to the seperation of ownership and management. The board of directors

who managed the company was separate from the owner who were the share

holders. The stake of the share holders was in the hands of directors. This led

to the development of managing agency system. A group of intellectuals quite

separate from the capitalist came Into existence. This was the group of managers.

Managers were expected to protect the interest of the public at large and that of

the capitalist. These conditions led to the development of management as a

separate science during the last two centuries.

2.2 Frederick Winslow Taylor

The practice of management is as old as human civilization. Human

beings, being gregarious in nature, have been living in groups since the very

beginning. The history Is full of evidences of organisational activity that indicate

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a knowledge of many of the Ideas later expressed by the pioneers of scientic

management. However, the study of how managers achieve results is predomi­

nantly a twentieth century phenomenon. In early stages, the management study

could not be developed because of low esteem of business, indifferent ap­

proach of economists towards business organisations and the attitudes that

managers were bom, not made.

Although management is as old as civilisation but, the principles of

organised activities were either not available or were not applicable in the social

environment. In fact, little organised effort was made towards the development

of management principles before the nineteenth century. The earlier contribu­

tions were scattered and were made only by practising managers and obscure

academics. Their organised research effort gradually resulted in the growth of

management principles. The earliest contributions to the science of manage­

ment came from the Roman Catholic Church, the military organisations and the

Cameralists. The Roman Catholic Church developed the hierarchy of authority

and specialisation of activities along functional lines. It invented the use of staff

device for efficiency. The military organisations emphasised what is called as

‘Unity of Command’ and the use of staff for line personnel. The Cameralists

were a bunAhi of German public administrators and intellectuals from Austria in

(the seventeenth and eighteenth centuries who stressed upon systematic ad­

ministration as a source of strength for the state. They propounded the prin­

ciples of specialisation of functions, care in the selection #nd training of subor­

dinates, simplification of procedures and legal proceisses which lead to the

establishment °f the office as comptroller in the government.

Winslow Taylor was born on 20 March, 1856 at a German town, in Phila­

delphia, U.S.A., in a middle class family. He completed his primary education in

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his birth place. His father wanted to send him to Harvard but Taylor’s weak

eyesight stood in the way. Taylor started his career as an apprentice in a small

machine making shop in Midvale Steel Works in Philadelphia Taylor’s classic

publication Principles of Scientific Management was published In the year

1911. During the last days of his life, he tried to prevent rapporchment with

labour, but the tide of time was against him. He died as a broken-hearted man in

1915 in the midst of official condemnation of Taylorism. He was a top produc­

tion executive, a consultant, and he worked as an all influential pioneer who

applied scientific methods to the solution of the factory problems. This Taylor’s

philosophy made him the “Father of Scientific Management.” His main works

include:

1. 1903, Shop Management, New York: Harper and Row

2. 1905, Concrete: Plain and Reinforced with S.F.Thompson.

3. 1911, Principles and Methods of Scientific Management, New York:

Harper and Row.

4. 1912, Concrete Costs with S.F. Thompson, New York: Harper and Row.

5. 1913, Scientific Management, Honover, N.H. Dartmouth College, Papers

1. 1895, “A Piece-Rate System.”

2. 1903. “Shop Management.”

3. 1905, “On the Art of Cutting Metals.”

4. 1911, “The Gospel of Efficiency.”

The conclusions embodied in Dr.Taylor’s ‘Shop Management' Constitute

the foundations of a new science......“The Science of Industrial Management"

A few excerpts from these two works ‘Shop Management’and ‘Principles of

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Scientific Management’ here present a birds eyeview on Taylorism.

Taylor in his two books entitled Shop Management and Principles of

Management introduces improved techniques of production. This mental revo­

lution represents the key approach in his scientific thinking. He stresses upon

the spirit of scientific inquiry. The major contribution of his studies lies in the

fact that the scientific methods of inquiry need to be applied in the entire arena

of management more especially in the areas of production, wages payment

and cost and planning analysis.

The philosophy of Scientific Management as propounded in these stud­

ies states that there is no inherent conflict in the interest of the employers,

workers and consumers. The results of higher productivity should equally ben­

efit in the form of higher wages to the workers, greater profits to the manage­

ment and lower prices for the consumers. Taylor advises that the management

should take the responsibility for determining standards, planning work sched­

ules, organizing, controlling and devising incentive schemes.

None of these principles can be isolated and the essence of Taylorism as

contained in these studies has been reduced to the following proverbial postu­

lates.

♦ Science, not rule-of-thumb;

♦ Harmony, not discord:

♦ Cooperation, not individualism;

♦ Maximum output, not restricted output; and

♦ Development, for highest efficiency and prosperity.

In its essence, scientific management involves a complete mental revo­

lution on the part of the working man engaged in any particular establishment

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or industry—a complete mental revolution on the part of these men as to their

duties towards their work, towards their fellow men, and towards their employ­

ees. And it involves the equally complete mental revolution on the part of those

on the management’s side, the foreman, the superintendent, the owner of the

business, the board of directors —• a complete mental revolution on their part as

to their duties towards their fellow workers in the management, and towards

their daily problems. Without this complete mental revolution on both sides sci­

entific management does not exist.

Apart from his doctrine of functional foremanship, Taylor developed sev­

eral technical mechanisms to promote his Principles of Scientific Manage­

ment Some of these mechanisms are;

(a) Time study to perform work properly

(b) Standardization of tools and movements of workmen needing caution,

(c) the desirability of a planning room,

(d) the ‘exception principle’,

(e) the use of time-saving implements and Instruction cards should be accom­

panied by a similar bonus scheme for successful performance of the task,

(f) The ‘differential rate’,

(g) the Mnemonic systems of classification; (h) a routing system, and

(i) the modern cost systems that can go a long way to sharpen these tools.

2.3 George Elton Mayo

George Elton Mayo was an industrial sociologist and is called the founder

of the human relations movement. He viewed the problems of workers from a

socio-psychological angle. Unlike the traditionalists, his extensive research proved

the importance of human groups and their causal effects on the behaviour of

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Individuals at work. Mayo analyzed the problems of fatigue, monotony, morale,

work environment and then-impact on the worker. His insights into the phenom­

ena of group behaviour and its significance to management discovered that

employees respond to non-physical variables like social organizations, with

perceived intentions more seriously than to the physical variables of the envi­

ronment.

Bora in Adelaide, Australia in 1980, George Elton Mayo was educated at

St. Peter’s College, Adelaide and received his Masters degree in Logic and

Philosophy from the University of Adelaide in 1889. He travelled widely in search

of a suitable profession. In the worse of his attempts he studied medicine in

Edinburgh and Scotland. During his stay In Scotland he was associated in a

study of psychology at Adelaide University. Mayo successfully organized psy­

chiatric treatment to the soldiers who suffered from shell shock during the First

World War in. recognition of which he was appointed as chairman of Philoso­

phy Department at University of Queensland.

His first research project in human relations in the industry at the University of

Pennsylvania was supported by Rockefeller and Carnegie Foundations of the

United States. Later he undertook a research project in a textile mill in Philadel­

phia. The results of this research was not recognized as definite contributions

by the management. But his work earned him a place in his rising career in

Academics. His recruitment as an Industrial Research Programmer at the Gradu­

ate School of Business, Harvard University, made him interested in classical

sociology, social anthropology and human factor studies. It was this interest

which shaped his research concerns in these fields. From Harvard, Mayo

planned his first intensive human relations study, known as Hawthorne Experi­

ments conducted at the plant of Western Electrical Company (1924-1932). The

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purpose of this research was to measure the effect of improved lighting on

workers. His researches followed allied problems and he permitted himself to be

led without regard to customary disciplinary boundaries. In 1927, he launched

the new famous Western Electrical Research programme along with Fritz

Roethlisberger. As director of the project he made important contributions to the

designs of the research programme and to the interpretations of the results.

The study made hun conscious about the problems of individual adjustments

and he devoted himself with vigour to the examination of such individual prob­

lems in the context of the organisational media.

Published Works of Mayo include the following:

1. Democracy and Freedom (1919)

2. The Human Problems of an Industrial Civilization (1933)

3. The Social Problems of an Industrial Civilization (1945)

4. Management and the Worker (1949) (With Roethlisberger, F. J

and Dickson) PAPERS:

1. What is Monotony (1929)

2. Changing Methods in Industry (1930)

3. Frightened People (1939)

4. Routine Interaction and the Problem of Collaboration. (1939)

5. The Descent into Chaos (1941)

6. Supervision and What It Means (1945)

Hawthorne studies and experiments were carried out by Elton Mayo, F.J.

Roethlisberger and their colleagues.

Being a student of industrial civilization these books on human and social

problems merit a detailed discussion. The first one entitled 77?e Human Prob­

lems of an Industrial Civilization’ was published In 1933. It carries contents of

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some of his lectures which he delivered on subjects like fatigue, monotony,

morale and social relations in industry. The study in general covers the Hawthorne

works, particularly the experiment of the relay assembly test room and the

interview programme. This book breaks a new ground. Here Mayo speaks of

two kinds of knowledge -(1) Knowledge of, and (2) knowledge by acquaintance.

The former is theoretical and second-hand. Hence it is bound to be insufficient

for the understanding of a practical problem. It is because it tends to be unre­

lated to reality. The latter, i.e. knowledge by acquaintance has tremendous

value as knowledge acquired through personal experience, or use of real life

situations.

The book named The Human Problem of Industrial Civilisation (1933),

discusses in details the factors that cause a change in human behaviour and

relationships. His thesis Is that Increase in productivity of workers does not rest

with working hours or rest pauses but is a cumulative product of factors like

open methods of supervision, autonomy to the workers, availability of small

cohesive groups and the conditions conducive to the growth of cooperation

between workers and management.

The study contains a chapter entitled, “The Rabble Hypotheses” which de­

serves special screening. 11 is a fierce attack on the fundamental basis of

classical economics He questions the very basics of laissez fairs doctrine and

the concept of scarcity. The former upholds that the good of all can be served if

everyone is left free to pursue his or her own interests. The latter upholds that

wants are unlimited and resources are not adequate to meet these growing

needs. Mayo contests the truth of these two assumptions and finds them invalid.

His fear is that a theory which is built around these assumptions is bound to be

false and misleading. It assumes that society consists of a rabble of individuals

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and all of them are self-seekers. But in actuality, the strength of the society lies

in its social groups which are known for their co-operation rather than for that

antagonism and discord.

Mayo laid down the foundation of Human Relation Approach to manage­

ment. His studies revealed the overwhelming role of human personality and its

sociopsycho dispositions in industrial relationship. Several research studies

conducted by Mayo and his team revealed that the sense of belonging, partici­

pation, recognition and allied non-economic incentives are more decisive de­

terminants of workers attitudes towards their work and management than mere

reward’s. Adequate communication upward from workers to management is

what shapes the quality and quantum of this contribution.

It was Lillian M. Gilbreth who wrote in 1914 a treatise on industrial psy­

chology entitled The Psychology of Management/ Using the technique de­

vised by Gilbreth and other psychologists, George Elton Mayo and Fritz J.

Roethlisberger of Harvard Graduate School of Business Administration and

William J. Dickson of Western Electric Company conducted the Hawthorne

experiments in the field of industrial psychology between 1927 to 1932.

Elton Mayo is called the father of this Human Relations School. He was

the team leader who conducted the study of Western Electric Plant (1917-

1932) to evaluate the attitudes and psychological reactions of a worker in and

on the job situation. His associates included John Dewey, Kurt Lewin, FJ.

Roethlisberger and WJ. Dickson.

2.4 The Hawthorne Experiments (1924-1932)

The Hawthorne plant of the General Electric Company, Chicago used to

manufacture Bell Telephone Systems and employed around 30,000 employees

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at the lime when the experiments were conducted. Although in respect of mate­

rial benefits to the workers, G.E.C. was a progressive company with pension

and sickness benefits and other recreational facilities for the workers. Still there

was a great deal of dissatisfaction among the workers and productivity was

much below the prescribed mark. After the utter failure of an investigation con­

ducted by the efficiency experts in 1924, the company took further assistance

from the National Academy of Sciences to investigate the malaise of low pro­

ductivity. Professor Elton Mayo and his team of qualified researchers were

asked to take up the study of relationships between productivity and physical

working conditions to begin with.

The employees of the company were drawn from 60 countries and represented

a typical mix of the cross sections of American industrial population. The com­

pany was professedly committed to the norms of justice and humanitarianism in

its dealings with its workers. The upper management of the company was re­

search-minded and was prepared to experiment and innovate. The Hawthorne

assignments were to study man in his work settings. The initial purpose of the

research was to determine the relationship between quality and quantity of

illumination and industrial efficiency. This modestly conceived research project

eventuated in a 12-year comprehensive and empirical study and is now re­

garded as a classip research effort of a marathon nature. Its findings were

influential far beyond the initial expectations of the investigators. In fact the

origin of the human relations movement in industrial psychology can directly be

traced to these studies of Professor Elton Mayo. The results of initial experi­

ments in the area of adequacy of illumination conducted by the experts of the

company were considerably different from what it was anticipated. They raised

many more questions than what they answered. The researchers decided to

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turn for help to Elton Mayo and Fritz Rolthlisberger of the Harvard School of

Business

Administration to solve this enigma. With their encouragement and support they

jointly undertook a series of studies which in their totality are called the famous

‘Hawthorne Studies’.

Mayo suggested that workers should be treated as human beings. He

discovered that monetary incentives do not work but socio—psycho needs are

of genuine interest to the management. His celebrated study entitled ‘The Hu­

man Problems of an Industrial Civilization' (1933), discovered a dozen new

ideas presented below:

(1) Knowledge of theories which are second hand are highly insufficient for

understanding the practical problems as they are unrelated to reality.

(2) Knowledge acquired through personal experience, or by use in real life

business situations is relevant and rewarding.

(3) Monotony of task leads to boredom and “Pessimistic reveries” and can

be eliminated by introducing rest periods.

(4) A society has to solve two kinds of problems which are:

(i) Providing for the economic needs of man, and

(ii) Maintaining spontaneous co-operation among men.

The modem industrial society is geared to meet the first and not the

second.

(5) Upgradation in social skills of co-operation was very necessary because

our social skills had not advanced step by step with our technical skills.

Patriotism is not enough, we must have no . hatred or bitterness

towards any one.

(6) He also talked about a term which he named “Rabble Hypothesis. "The

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 concepts of Laissez-faire and scacity gave us two theories which don’t

hold good today. The society consists of a rabble of individuals and they

all are self-seekers is a dangerous Rabble hypothesis which needs to be

discarded. The strength of the society lies in its social groups known for

their co-operation.

(7) The nature of supervision makes a great difference in morale which is

important for an organization.

(8) The informal groups have a great impact on morale and productivity.

(9) Sudden and radical changes in technical skills must be matched by so­

cial changes in methods of living to meet the altered situations. “You

cannot live and prosper with one foot in the twentieth century and the

other in the eighteenth.”

(10) The role of social groups and the need to develop social skills are the

practical methods of dealing with human problems of society as a means

of improving production. '

(11) The activities of the work group should be integrated and increase in

productivity can be related to the group effort.

Bom in France in 1841 Henri Fayol graduated in 1860 and became an

engineer. He worked at Commentry-Fourchmboult-Decazliville which was a

French mining and metallurgical combine. He worked as a junior executive and

was promoted to chief executive position in 1888. His managerial telents pushed

his organization from the verge of bankruptcy, to the pinnacle of a successful

and profitable organization. As an engineer, he was fully conversant with the

principles and techniques of management. His workshop experience contrib­

uted to his thoughts on management. His conclusion was that there could be a

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single administrative science whose principles could be universally applicable,

irrespective of the kind of organization and the managerial situations.

Fayol started writing in seventies on administration and mining engineer­

ing, After retirement, he devoted rest of his life in writing and propagating prin­

ciples of management. He is regarded as the Francis Bacon of Management.

His writings reflect 50 years of his managerial experience and experiments. He

read his first paper on Management theory under the auspices of Congress de

et de la Metallurgie. Which was followed by another paper on General Prin­

ciples of Administration published in 1908. His famous classic Administration

Industhelletg’en’erale (French) came in 1916. It has been translated into many

languages.

He studied the problems of public services of the state in his later years.

He tried to present a theoretical analysis of various types of organization. Fayol

established the centre for administrative studies types of organizations. Fayol

established the centre for administrative studies which had tremendous impact

on different organs of the French Government. While analyzing managerial

activities he has divided his study of management in three parts (i) managerial

qualities and training, (ii) general principles of management, and (Hi) elements

of management.

Administration, Industrielle et generate an appraisal was first published

as a bulletin of the Society de I’ Industries Minerale in 1916. It is better known,

in the United Kingdom, as ‘General and Industrial Management/ in English

translation by Constance storrs, published by Pitman in 1949. The book is

organized into four part as under:

Part I. Necessity and Possibility of Teaching Management.

Part II. Principles and Elements of Management

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 Part til. Personal Observations and Experince.

The IV. Lessons of the War

“The meaning which I have given to the word administration and which

has been generally adopted, broadens considerably the field of administrative

science. It embraces not only the public service but enterprises of every size

and description of every form and every purpose. All undertakings require

planning, organization, command, co-ordination and control, and in order to

function properly all must observe the same general principles. We are no

longer confronted with administrative sciences, but with one which can be ap­

plied equally well to public and private affairs.”

“Management plays a very important part in the government of undertak­

ing; of all undertaking, large or small, industrial, commercial, political, religious

and others.”

Fayol distinguished between management principles and management

elements. The former and fundamental truths and establish cause-effect rela­

tionships, while the latter denotes the functions, performed by a manager. The

principles of management, essentially imply two things: (i) They can not be

exhaustive but have to be suggestive, (ii) They are not rigid but flexible.

1] Division of Work:

2] Authority and Responsibility:

3] Discipline:

4] Unity of command:

5] Unity of Direction:

6] Subordination of individual interest to general interest:

7] Remuneration of Personnel:

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8] Centralization:

9] The Scalar Chain:

10] Order:

11] Equity;

12] Stability of Tenure of Personnel:

13] Initiative;

2.5 Chester I. Barnard

Chester I. Barnard stands out promintently among those management

thinkers who believed that management principles could be applied to any type

of organization in any field. He himself managed business, governmental, edu­

cational and philanthropic organizations during his entire life career and all with

equal success. He has been called the father of “Social system school,” which

has effectively shaped the organization thought of our century.

Chester Bernard identified and stressed the implications of human factor

in the working of organizations.

Born in 1886 Barnard joined Harvard University in 1906. Though he

studied economics there and finished ail his course requirements within a record

period, he could not get his degree because he lacked a course in laboratory

science and could not find it essential to have one.

His famous study the The Functions of the Executive1 along with a

number of papers in academic journals manifests his profound knowledge and

thought on organization. His work marks a distinct departure from the past

thinking which was primarily influenced by the scientific management school of

Taylor. He considered the analysis of processes of management in terms of

principles as a futile exercise and Identified nonlogical elements which influ-

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ence organizational behaviours. In the words of Anthony Tillett, “Barnard’s main

interest lay in the role of the executive in organization, and his main concern

was to show how behaviour and action within an organization differred from

other kinds of behaviours, particularly with the degree of reciprocity that exists

between the person and the organization.”

The major publications include;

1. The Functions of the Executive, published in 1938.

2. The Nature of Leadership, published in 1940.

3. The Theory of Authority.

4. Elementary Conditions of Business Morale, published in 1948.

5. Organization and Management, published in 1948.

I Individuals in organizations continuously interacton the basis of their per­

sonal relationships rather than on the basis of organizational purpose. The

continuity of these interactions and relations gradually gets systematised and

results in informal organization. They constitute the aggregate of personal con­

tacts and interactions and associated groupings and become effective in run­

ning the formal structures. According to Barnard they are the interdependent

aspects of the same operational phenomenon. In fact, the society is structured

by formal organizations but they get vitalised and conditioned by the existence

of these informal organizations. Apparently the relationship between these for­

mal and informal organisations may look contradictory but they are operation­

ally supplementary and reinforcing. Thus, it is important to know the organiza­

tion ropes, i.e., who is who, what is what and why is why in the organization.

This book of Barnard is regarded as a definite contribution to management

leadership. William Wolf has commended about this work in the following words.

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 “The book itself is a sociology of management. Its style of writing was pur­

posely pitched at a high level of dis-course. Barnard was writing for social

scientists, not for practitioners. He believed the field of management was lack­

ing in concepts and was clouded by ambiguous and even erroneous thinking.

In a sense, he hoped that the functions would set things right and guide the

social scientists to more realistic studies of organization and management.”

2.5 Herbert Simon: The Pathbreaker in Modern Management Thought

One of the leaders in this modem development of progress from one

fruitful stream of thought to another is Herbert A. Simon, His study covered all

the disciplines which were being studied at that time. Trained as a political

scientist, he was faced with problems of public administration. These problems

led to questions of organization. His publication (1947) Administrative Behaviour

proceeded to challenge the existing thought and became a classic in the field.

Keeping, economic questions as central he presented his research in the disci­

pline. He felt the need for the rigorous use of tools of mathematics and statis­

tics. His techniques, employed these basic tools together with experimentation

on the applications of computers in management research. His approach, has

been interdisciplinary and focuses on “decision-making,” which has become a

major subject for management attention.

Simon, an eminent American political and social scientist, was bom in 1916, in

Wisconsin. He received his Ph. D. in political science from the University of

Chicago. Starting his career in municipal government on which he authored

quite a few books. He served with great distinction in various capacities in

organizations as an academics and as a consultant. His contribution to admin­

istrative thought and its popularity in the field are evident from the number of

publications on different subjects, many of which have been translated into

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various languages including Turkish, Persian and Chinese. His principal publi­

cations are:

1. Measuring Municipal Activities (in co-authorship with Clarence; Rid­

ley).

2. Administrative Behaviour(1947).

3. Public Administration (1950) (in co-authorship with D. Smithburg

and V. Thompson),

4. Fundamental Research in Administration (1953).

5. Organizations (1958)

6. Models of Man (in co-authorship with Jam

7. The New Science of Management Decision ( )

8. Shape of Automation (1960)

9. Sciences of the Artificial (1969).

10. Human Problem Solving (1972).

11. Models of Thought.

12. Models of Bounded Rationality.

13. Reason in Human Affairs.

Simon is of the view that man is not completely rational. He can at best

understand his “bounded rationality.” There are limits to rationality. These limits

pertain to the quality and quantity of the output of the administrator. Such limits

include :

a) Limits on his ability to perform, and

b) Limits on his ability to make correct decisions.

Simon focuses attention on the dynamics of decision-making processes

and its role in organization. But while concentrating on this, he relegates social,

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political, economic and cultural factors to the background although their role

should be no less significant in any analysis of administrative behaviour. Simi­

larly exclusion of value premises which are integral and essential compo­

nents of policy determination per se would steer the study of public administra­

tion to routine, mechanical and less important aspects. Hence Simon’s idea of

fact-based administrative theory makes it more relevant to business administra­

tion than public administration.

Although the decision-making process is an important variable in the organiza­

tional situation, it alone is not adequate to explain the totality of the organiza­

tional picture. Decision-making is a process involving various dimensions. Simon’s

efforts to construct a value free science of administration on the ground that

bureaucracy is not, and cannot be a neutral Instrument solely devoted to the

unmotivated presentation of facts to and the docile execution of orders from

political superiors. Norton E. Long is critical of it. Selznick argues that radical

separation of facts and values too often identified with logical distinctions be­

tween factual statements and preferential statements encourages the divorce of

means and ends.

Simon’s major contribution is in the area of decision-making. But till

date, the Indian corporates and manager and in the private sector for public

sector seek ways to avoid making decisions. However with liberalization open­

ing up of the Indian economy and globalization the Indian companies would

have to compete with global giants, and the Indian managers will have to realize

the role of decisioning to create a corporate niche globally. Simon believed that

computers cannot only calculate but also think. Thus Cybernetics of computers

in decision-making will help to over come human limit like fatigue or frustration.

They would give greater transparency efficient decision, use of expert systems,

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artificial intelligence and statistical information to improve inputs in decision

making and the decision-making would be programmable.

2.7 Peter Drucker:

columnist of the post war era in corporate and government circles. He was

responsible for providing a certain legitimacy to the cult of management.

Born in Vienna in 1909 in a family of printers and publishers, he has

been pursuing his inherited literary and cultural traditions. He was educated in

Vienna and Frankfurt and taught at the University of Frankfurt. He worked in

England in a merchant bank and as a correspondent for a newspaper before

sailing to the U.S.A. in 1937. He has been a teacher, writer, speaker and a

consultant in the U.S.A.

Peter F. Drucker has been a prolific writer. He has had many books

published on a wide range of socio-economic subjects. He has written schol­

arly papers and articles for journals and dailies on topics of current economic

and managerial interests. His famous works include The End of Economic

Man’ (1939), The Future of Industrial Man” (1942), The Concept of Corpora­

tion’ (1946), The Practice of Management’ (1954) and The Effective Execu­

tive’ (1967). Drucker comes with the vision of the world order in his ‘Future of

Industrial Man'which is basic in all his writings on management. In his own

words “No society can function as society unless it gives the individual member

the social status and function and unless the decisive social power is legitimate

power." The future of industrial man and the concept of corporation are the two

building blocks on which Drucker’s massive structure of organization theory

and practice rest.

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 The Practice of Management (1954); It is the first comprehensive study

of management craft. The practice has been viewed and studied on the can­

vass of management theory evolved by earlier writers. The book, which has

been the most popular publication of the century propounds that management

hi its ultimate analysis is a humanist discipline in which human judgment, values

and ideals play the decisive role. Technical perfection according to Drucker is

good but it is not adequate. The mangers must understand the wider implica­

tions of their activities. They must contribute to the development of a humane

culture and a humanistic society. The theory and practice of management should

achieve economic performance as well as individual development and there is

no inherent conflict between the twin objectives. Ultimately all development is for

the people and if the management functions hi the interest of popular good then

it will endear itself to the society. Its authority will be accepted and respected by

the people. Peter in this study advises managers not to try to be over smart or

clever. They should be simple and honest and hence his emphasis all along has

been on the social responsibilities and professional tasks of management as a

practising consultant.

According to Peter F. Drucker, “Management is a social function," and

advancement in the discipline and practice of management should embrace

both entrepreneurship and innovation.” In his book'Innovation and Entrepre­

neurship’ (1986) he has defined both these features as disciplines. It is clearly

a part of management and rests on well known and time tested management

principles. It applies to both existing organizations and their new features.

The Effective Executive is another fine book from Peter. Written with

intense concentration, this slim volume possesses great clarity, lucidity and

incisiveness. It is illuminated by flashes of subtle perception and insights. It is

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invaluable because the study quite lucidly enumerates the principal character­

istics of an effective executive which according to Drucker are of universal

import The effective executive should focus his attention on objectives and

performance because he knows how to tackle the right tasks. He should con­

centrate on one task at a tune and only on tasks which he considers to be of

great importance in order of priorty. The guiding principle of this 'Effective

Executive' has to be: What can I contribute and how can I motivate others to

make their own contribution so that together we achieve our goals? His major

objective is improved performance of the whole. He seeks to develop a team

that can achieve peak performance.

The second task deals with work and worker. Drucker has defined work

as a thing, it is impersonal, it is objective, it is a task. Work has a logic. It

requires analysis, synthesis and control. Drucker has acknowledged the works

of Taylor and Gantt. Taylor was the pioneer and his deemed work deserves a

systematic observation and study. Taylor had given three elements, analysis,

synthesis into a process of production and feedback control which are particu­

larly important in knowledge work. But according to Drucker knowledge work

needs far better designs, precisely because it can’t be designed for the worker.

It has to be designed by the worker.

Peter F. Drucker is against bureaucratic management. He emphasises

creative management, i.e. the manager should be an innovator. In his 'Practice

of Management’, he wrote. “Managing a business cannot be a bureaucratic, an

administrative, or even a policy-making job.... (it) must be a creative rather

than an adaptive task.”

Peter F. Drucker’s concept of MBO has become an indispenable tool in

modern organizational structures. The flat and decentralized structures of the

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giant multinational corporations like Pepsi, Hindustan Lever, Reebok are in them­

selves, the current examples of the great ability of this concept. The organiza­

tional structure of ‘Lintas India’ is essentially governed by the principle of MBO.

Peter’s prophecy of the disintegration of the USSR has proved to be correct.

The political reality of counter productiveness of arms can be clearly seen in

the on going battles in Bosnia and Herzegovina and Afghanistan. The multipolar

world is clearly in sight with EEC, USA, Asia-Pacific Rim as the new world

economic powers.

Druker’s contributions have made tremendous impact on the manage­

ment practics. His contributions have recognized even by the management

thinkers of socialist block.

Any introduction of basic management concepts remains incomplete with­

out a discussion on MBO. Undoubtedly it is the greatest contribution of Peter

Drucker first propounded in “The Practice of Management" in 1954. MBO

operationalizes the concept of objectives in devising a process by which objec­

tives cascade down through the organization. The organization’s overall objec­

tives are translated into specific objectives for each succeeding level, that is,

divisional, departmental and individual in the organization. Since lower unit man­

agers jointly work towards setting their own goals. MBO works from the “bottom

up” as well as from the “top down.”

Some of the important management thinkers in this line are as follows:

2.8 Chris Argyris;

Professor Chris Argyris has put a model of the behaviour of the individual, the

formal organization and the informal organization in a neat perspective. His

assumption of incongruence between the needs of the individual and the orga-

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nization is important and visible in big industrial organization as evidenced by

empirical evidence cited by him at every stage. According to him every indi­

vidual has “psychological energy” to expand. The author has integrated the

thoughts and his own experience as consultant with large corporations like

I.B.M., DuPont and Shell Oil. As Professor of Education and Business, he is in

strong stead to analyze the behaviour in an academic style without leaving the

reins of reality. While the author has poured his thoughts in fifteen books and

over hundred articles, his greatest contribution is “his illuminating idea that

formal organizations are basically anti-maturing and therefore act against em­

ployees achieving a sense of self-actualization” as explained in his illustrious

work Personality and Organization.

As a criticism on his general approach, however, it is stated that his work

seems to be focused exclusively on the problems of the individual. His contribu­

tion is, nonetheless, an important guide and warning to those who look to man­

agement theory and practices as important tools for creating a society with a

human face.

Born in 1923 in USA, Chris Argyris is an internationally acclaimed scholar

in the field of management. He is a scholar of varied learnings who has put his

encyclopedic knowledge and experience to the corporate world of organiza­

tions. Chris has been a professor of organizational behaviour at the Harvard

Business School, and has served as an important consultant to major US cor­

porations like IBM, Shell, and Dupont. He also advices the US state department,

and many other international organizations. His works are too numerous to be

listed and even a review of the minor ones can ensure him a proud place in the

annals of management thought.

Chris Argyris is a leading proponent of behavioural science movement.

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His research findings have been the basis of his twenty-four books and innu­

merable papers, the bulk of which are devoted to conjoin the needs of the

individual with those of the organization. The academic achievements of Chris

demonstrate his versatility with a baccalaureate in psychology, and a doctorate

in organizational behaviour. He has taught at Yale in the fifties and could be­

came a professor of Industrial Administration there in 1961, before joining Harvard

in 1968.

His book Personality and Organization' published in 1957 is regarded

as a classic of behavioural science. It was followed by Integrating the Indi­

vidual and the Organizations’ in 1964. These two books contain his outstanding

contribution namely the Goal congruence theory.

He is a modernist writer much-much in advance to other socio-psycho-

iogical thinkers of Human Relations School. In fact it involved a distinct get

away from the two distinctive approaches which were formulated by his con­

temporaries. The sociological writers stressed group dynamics, interaction, and

informal relationships while the pure psychological writers concentrated upon

the individual, his needs, aspirations and motivators.

Argyris strives to strike a balance, whereby the individual needs match

the group needs which constitute the needs of the organization. This was his

goal congruence approach. He expanded this view from the factors of infant-

adult maturity expectations to the more practical approach of psycho-energy.

An individual has the potential to achieve his so called “SelfActualization Goal"

It is his organization that restricts his utilizing of potential. Thus the brimming

pot is left untapped, to the disadvantage of both the firm and its employee.xx

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2.9 Rensis Likert:
Likert’s belongs to the psycho-sociological school has put the study of

managerial and organizational problems on scientific footing. The findings in

‘Patterns of Management’are based on detailed data collected and analyzed

by a team of forty researchers. Like other contemporary thinkers as Argyris

and Drucker, Likert believes in the observable change in the attitudes of the

people who are favourably oriented to free, open and supportive climate. It is

obvious that with more education, greater freedom in industrial societies, greater

concern of people towards quality of life of workers working in unpleasant at­

mosphere will follow. In growing size of organizations, close supervision and

control would not enable the organizations to motivate the people for the twin

goals of meeting, the objective of individual, needs of his personality and eco­

nomic objectives of the organization.

Rensis Likert is one such behavioural scientist who has made a tremen:

dous contribution for the development of management thought. As a social

psychologist he has made use of behavioural sciences to explain and tackle the

managerial situation.

Likert, born in the U.S.A. in 1903 was educated at Colombia University.

His main area of interest being management and human organization, he has

developed new ideas of management for the development of human aspects of

organization. He taught at the University of Michigan. There he founded the

institute of Social Research. Here extensive and intensive field studies were

carried out on management practices under his supervision. These studies

were more or less interrelated and were carried out on an extensive scale on

the working to industries like heavy machinery, public utilities, automobiles etc.

These research works have also covered a variety of employees ranging from

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unskilled labour to scientists in research labs.

The findings and conclusions of Likert’s studies have been compiled

and presented by him in his three books namely:

1. New Patterns of Management

2. 77\e Human Organization: its Management and Value.

3. New Ways of Managing Conflict.

His other Publications include;

1. An Improvement Cycle for Resource Development.

2. Organizational Aspects of Human Behaviour and Human Beings in an

Automatised World.

3. Past and Future Perspectives on System IV.

4. Profiles of Organization Characteristics.

5. Technique forthe Management ofAttitudes.

Rensis Likert through his studies has identified the forces that exert pres­

sure for high performance in American business organizations. Some such

forces are growing competition among world markets, close supervision and

resistance to pressure demand by individual.workers for more freedom coupled

with resultant changes in attitudes, expectations and life-styles and growing

concern for physical as well as mental health.

In this celebrated study entitled ‘New patterns of Management’ (1961).

Likert presented his major findings of an intensive researh programme which

he conducted at the Michigan Institute for Social Research. It summarises the

principles and practices used by the most productive managers of those times,

and then proposes a management system based on these principles.

In another study of ‘Human Organizations'Likert maintains that every

aspect of the organizational activities is determined b\the competence, motiva-

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tion, and general effectiveness of the human organization.

Likert opined that the organization concepts should be looked at in a

comparatively social evolutionary manner. As such, he started with System 0.

Likert maintained that System 0 is an organization that has no structure at all.

Likert has influenced people’s thinking about the working of human orga­

nization by his extensive research. He belongs to the civilization of Fredrick

Herzberg and Douglas McGregor. He has emphasized on the need hierarchy

model ot Abraham Maslow and has given a suggestive model for measuring

characteristics of an organization from its actual state to the idea! state.

Likert emphasized on effectiveness of an organization in terms of the

behaviour of the formal leaders and the Pyramid of hierarchical levels. He was

against all emphasis on relations of authority, subordination, one way flow of

decisions, rules and other co-ordinating efforts from the top to the bottom.

Likert’s principle of supportive relationships is consistent with McGregor’s

cycle theory. Likert emphasized the internal dysfunctional effects of conven­

tional models of management, particularly in terms of their motivational costs.

Some researcher have approringly confirmed that “the granting of freedom for

decision and action tends to result in a chain reaction down the line.”

The belief of Likert about management was that assigned to them.” Logi­

cal to be preoccupied with tangible results, and stay aloof from personalities.

Rensis Likert has been called a ‘Revisionist’ by Warren Bennis. This Is

so, because according to Bennis, Likert attempted to reconcile classic con­

cepts of management with the doctrine of human relations. Likert has himself

admitted, though in vague terms, that under capitalist conditions, the owner

cannot expect support and understanding from the exploited, and to expect

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human relations under capitalism to be effective is Utopian.

2.10 Warren G. Bennis:

Bennis’s stress on revitalization, a challenge of growth or decay, is basic

as it offers precise suggestions and tasks for managers, viz. to take conscious

responsibilities for their own evolution and follow a planned methodology. The

explicit directions can enable it to realize its potential, and permit students of

organizational behaviour, to evolve theories of changing and carry out more

and better studies of social evolution including cross-cultural studies encom­

passing a wide range of technological, political, social, economic and legal

variables. Thus, Bennis has successfully and candidly stated his theme that we

have highly inadequate theories and practices which are unable to meet the

demands of the rapidly changing environment which is affected by the growth

of science and technology. He has successfully drawn the attention of the

management world towards “Planning of change” as against a mere cause and

affect narration of change as hitherto made by writers on the subject.

Warren Bennis, a distinguished professor of business administration at

the university of South Carolina, received his A.B degree (1951) from Antioch

College, an honours certificate (1962) from the London School of Economics,

and his Ph.D. degree (1955) from M.l.T in Economics and Social Science. He

served for several years on the faculty of M.l.T Sloan School of Management

and succeeded Douglas McGregor as the chairman of the organization studies

department in the school. He has also served as faculty member at Harvard and

Boston Universities; as provost and executive Vice-President of the State Uni­

versity of New York, Buffalo; and as President, University of Cincinnati from

1971 to 1977.

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 Bennis has authored 15 books and over500 articles. The important among

them are ‘Changing Organizations' (1966), ‘Beyond Bureaucracy’ (1971), ‘Tlte

Unconscious Conspiracy1 (1978), ‘Leaders-Strategies for taking charge’ (1985),

Why Leaders Can't Lead’ (1990). He was recognized as a radical thinker by

his book ‘Changing Organizations’.

Contributions of Warren Bennis can be classified in to two major areas

viz change and leadership.

Bennis is known as an Organizational Development (O.D.) expert. Orga­

nizational development according to him “ A response to change, a com­

plex educational strategy intended to change the beliefs, the attitudes, the val­

ues, and the structures of organizations so that they can better adapt to new

techniques, markets, and challenges, and the dizzy rate of change itself.”

Bennis researches tend to give an Impression that leaders are not nor­

mal or average individuals but people who can do miracles. Although Bennis

has tried to assert this several times that any one of us can be a leader if we

exercise our qualities properly, but then at the same time he has also said that

leaders are people who do the right things. Such statements make us perceive

that leaders are ideal humans. They possess all the virtues such as integrity,

dedication, magnonimity and humility that are perceived as ideals in the present

society. The reader gets an impression that being a leader would require reaching

to the zenith of human values where the society or your subordinates will look

up on you to present a sense of common vision.

Though Warren Bennis can be called a sociologist, an industrial psy­

chologist, an academician, a practitioner, a prolific writer, a successful leader

and above all a scholar of extraordinary vision; his thoughts and mind set elude

all attempts at mind reading and concerted analysis. After reading through

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many of his works, alone a faint picture about the person and his thoughts

emerge. Concepts such as organizational health, planned change and lab­

training are important aspects of leadership and a comparison of Bennis with

contemporary management and social thinkers needs a thorough analysis. The

Bennis’ conclusions need to be tested in the Indian context. The analyst will

have to initiate himself into his thought process after reading his voluminous

books.

2.11 Douglas McGregor:

Professor Douglas McGregor, McGregor emerged as management psy­

chiatrist, who quite scientifically demonstrated the unrealistic and limiting as­

sumptions of traditional theories of management concerning human nature and

the control of human behaviour in the organizational setting.

The Human Side of the Enterprise makes the watershed in the history

of management movement dominated by the writings of his predecessors. His

numerous articles, encompassing a very wide and varied range of professional

managerial skill make an eloquent plea for a brand ‘new social architecture,’

new value system to which man and management can gainfully commit them­

selves for the attainment of professional objectives.

The main argument of this book (which is more popularly known for its

tow important suppositions called theory X and theory Y) has been that "the

theoretical assumptions which the management holds about controlling its hu­

man resources determine the whole character of the enterprise.

Human behaviour is predictable but as in physical scinece, accurate

prediction hinges on the correctness of underlying theoretical assumptions....

We can improve our ability to control only if we recognize that control consists

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in selective adaptation to human nature rather than in attempting to make hu­

man nature conform to our wishes. If our attempts to control are unsuccessful,

the cause generally lies in one choice of inappropriate means. We will be

unlikely to improve our managerial competence by blaming people for failing to

behave according to our predictions.

If ‘Ttie Human Side of the Enterprise’ represents Douglas McGregor’s

concern to educate future managers. His last book The Professional Manager1

posthumously published, reflects his commitment towards developing the pro­

fession of management through bridging it’s goals, with the aims, values and

methodology of behavioural science. In McGregor’s view the managerial cos­

mology should meaningfully address itself to the understanding of the manager’s

behaviour, his identity and his role perceptions of the industrial organization. As

a researcher, McGregor makes a plea that management styles and strategies

should be evolved and continuously adjusted in the light of the empirical experi­

ence of reality, consistent with the findings of behavioural knowledge. This will

make sense and make theory relevant to practice.

One of the major contributions of Douglas McGregor to management

science is his concept of transactional influence. The management of differ­

ences or building a managerial team is not a simple matter of managerial power

or controls. To a professional manager, it is actually a challenge of organization

of managerial work. McGregor finds influence as a social phenomenon which

is mutuality oriented. “It cannot be a win-lose affair in which if A gets 100 units,

B must get zero or if A gets 90 units, B will have to satisfy with 10 only." He has

taken pains to demonstrate that when certain social elements such as trust and

mutual support are present, there is no need for concern about ‘power equal­

ization’ orthe loss of responsibility and status in managerial hierarchy. Throughout

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his life McGregor kept on responding to this dilemma of his friends and critics,

who have been repeatedly telling him “Your theories are fine but they do not

work. We agree with your theory Y, vision of man but we do not know how to put

it into practice." Ultimately, McGregor’s answer to the above was that each

person must find his own answer. But as a researcher, he certainly developed a

conviction that answer to this key issue can provide more gases for human

choice. In his The Professional Manager1 he discusses In greater detail his

yjew how the manager can think about and deal with himself, his role and style,

his own power, the issue of control over others, the problems of team work and

above all how to manage conflict creatively.

2.12 Limitations of Modern Management Approach:

Management, as it obtains today, is a technique imported from the West

It is not germane to Indian soil, it is not based on Indian heritage. We have

already entered into the age of computers and robots when, perhaps, human

mind and hands are sought to be eliminated. Excessive technological growth

has created an environment in which life has become physically and mentally

unhealthy. They concentrate on ‘production targets’ and ‘profit and loss accounts’,

thus losing leverage to engineer a ‘turn-around’ and believe that the ‘balance

sheet1 of human talent is of secondary importance in the organisation.

Management, which was once a personal and direct action has now

grown into an indirect feat and phenomenon. This change in the management

system has brought in a lure for materialism and the race for production and

distribution has brought forth a lust for profit all-round. Ends rule supreme,

means are discounted. Management has been reduced to be a handmaid of

profiteering. The maximising of profits becomes the ultimate goal, to the exclusion

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of all other considerations. This technology is fragmented rather than holistic,

bent on manipulation and control rather than co-operation, self-assertive rather

than integrative, and suitable for centralised management rather than regional

application by individuals and small groups. As a result, the technology has

become profoundly anti-ecological, anti-social, unhealthy, and inhuman.’1 And

this pattern of management naturally rests upon giantlike industries, massive

and round-the-clock production and productivity of the worker. ‘Productivity is

usually defined as the output per employee per working hour. To increase this

quantity, manufacturers tend to automate and mechanize the production process

as much as possible. However, in doing so they increase the number of

unemployed workers and lower their productivity to zero by adding them to the

welfare rolls.”

The core of modern management thought is the worker (MAN?) - an

efficient workman, a skilful functionary and a productive member of the work­

force. They are paid more so that they may work more and better; they are

rewarded and reimbursed so that they remain iocked-up with management as a

lever of contributing profits. This has brought into tore management and workers

as separate entitites their approach is different, their interests ape diverse and

their claims are conflicting. There has remained no more common approach

and understanding between members of a management hierarchy.

To the modem management, the worker is all. MAN stands nowhere. The

moment he ceases to be serviceable he stands discarded, like a hired commodity,

arid is promptly replaced. The work-force, too, resorts to underhand pressures

just to extract as much as possible to dupe the management. Conflicts are

common, violence is rampant, absenteeism is the rule and strikes and breakdowns

are daily occurrences.

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 This materialistic management has done more harm than good. The

capitalist has grown richer, man has been reduced to a hired wage-earner and

the consumer has been placed at the mercy of the materialist-manager. There

is no sense of belonging, no harmony, no cooperative organisation, no fellow-

feelings and the least common approach and perspective.

One obvious result of this pernicious form of modern management has

been disregard of human approach, loss of human values and erosion of human

touch. The crisis of confidence prevails in ail camps. The society has suffered

and deteriorated, the worker has remained demoralised, the consumer has

been by-passed and man has suffered loss of dignity and his due.

The manager, too, is not a net gainer. He has earned millions but only at the
*

cost of his peace and sound sleep. He suffers from insomnia, gastric complaints,

high blood-pressure, heart-ailments and mental discomforts. He fattens his coffers

but suffers from mental unrest. Labour troubles, production losses, erosion of

markets, tax measures and reduction of profits haunt his mind yielding only

sleeplessness and resort to sleeping pills. Wealth is gained but peace is lost. No

wonder, therefore, that the materialist management of the Western style has

remained to be only a ‘soul-less management1.

In a cynical way, of course, one may deploy the four classic means of

sama-dama-danda-bheda. There is the tactful and conciliatory way littered with

sweet speech; there is the way of bribing, carrot-waving, sugar-plum offering;

there is devious divide-and-rule tactics; and there is the way of attack, revenge,

deprivation, brandishing the big stick, giving no quarter. People are ordinarily

moved by flattery, greed, suspicion and fear, and the manager is free to exploit

one or more or all of these only too common emotions and passions and

inducements. But this may not take him far, or not for a long time. Without hard-

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won knowledge, a gift of vision or feeling for perspective, a total sense of

responsibility and an approach of consciousness, one must sooner or later,

mess up management and fail as a manager.

There can be, one might say. two attitudes in general to life and life’s work.

There is the attitude of seperate acquisition and possession or competition,

anxiety and strain. There is another one of relative freedom, of detachment, of

relaxation and of seif-concentration.

The latter attitude is bom of spiritual world-view, as distinct from the

materialist view-point. If one must think of the enemy, he is everywhere and

there can be no escape from him. Then, why not think of the enemy as the

friend, why not transcend the duality of enemy and friend ?

2.13 Corporate Excellence and Mahabharat:

Mankind is in the search of excellence since its evolution. He has natural

instinct to remain happy. The happiness can be attained either through

contentment which we possess orthrough successfully achieving what we desire.

Vedic Vision stresses on the tormer ‘action with self-contentment’ whereas latter

has played a crucial role in corporate Excellence Journey ot the modem world.

The Excellence journey begun thousands of years ago, as man remained in the

pursuit of acquring more and more facilities to satisfy his ever growing desires.

Good produced or services rendered can bring in happiness only when they

serve the objectives desired by their users, and it becomes the tiger for the

corporate excellence journey. Vedio-Vision stresses on ‘Prosperity for all’whereas

we forgot to take this aspect in the past, leading to the industrial recessions,

trade union struggles and other problems the industrial world is facing today.

Before moving to understand meaning of excellence as described in Veda, let

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us trace the historical path of corporate journey and status of Corporate

Excellence first.

Corporate journey of modern era starts from the ‘Industrial Revolution’

during the 1700’s and 1800’s with spread of power-iven machinery and led to

rapid growth of industry. As the revolution grew, investors were needed to provide

the money for further expansion of industrialisation. Financiers and banks thus

became as important as industrialists and factories in the growth of the revolution.

For the first time in European history, wealthy business leaders called ‘Captalists’

took over the control and organisation of manufacturing. Industrial Recolution

chagend the westren world from a rual and agricultural society to an urban and

industrial capitalist society. Industrialisation brought many material benefits, but

it also created a large number of problems like air and water pollution, poor pay

and long working hours under unhealthy conditions for factory workers,

unemployment etc.

Karl Marx, developed the theory of ‘Communism’ with the that the only

way to ensure a happy, harmonious society was to put the control in workers

hands. His ideas were partly a reaction against hardships suffered by workers

in England, France, and Germany during the Industial Revolution. Marx believed

that workers would be driven by the march of history to rise up against the

wealthy and to establish socialist economic systems and classless societies.

Marx predicted that central planning of Industrial and agricultural production

would guarantee economic efficiency, job security, and income equality. However

it created serious economic problems and faild to provide high-quality goods &

services and could not respond quickly to changes in consumer demand.

Workers had little motivation to be productive because their wages remained

about the same regardless of how they produced. Communism shaped much of

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history from early 1900’s to 1990’s. However during this period Capitalism

became more successful in Europe with economic growth of middle classes

and the growth of democracy.

The surge of “Scientific and Technological Achievements” was seen after

the World War II. In 1957, the space age began when the Soviet Union launched

the first artificial satelite to circle the earth. In 1969, two American astronauts

became the first human beings to Awalk on the moon. Advances in science and

technology have changed the world in many dramatic ways. Aeroplenes, cars,

communications stellites, computer, lasers, plastics, refigerators, and television

are only few of the inventions that have transformed human life in this century.

Scientific led to the discovery of nuclear energy as source of power. The rapid

medical progress and increases in food supplies have enabled millions of people

to live healthier and longer lives.

As per Vedic vision, Corporate excellence can be achieved through

‘Prosperity for all’ or in other words by taking care of all the stakeholders. For

an organisation there are 5 stakeholders nemely -\XOjstomers, Employees,

Suppliers. Shareholders and Society as a whole. In the previous paragraphs,

we saw how the Capitalism & Communism grew and failed due to conflict between

interests of Employer and empoyee led poor quality and hence a disstisfied

customers. Scientific & technological development too could not fill the gaps

between employer & employees.

The Industrial management progressed through theories and thoughts

like Fayol’s 14 principals of management, F.W. Taylor’s Scientific Management

based on work studies, Gilbrith’s Micro Motion studies, Max Weber’s

Bureaucratic Management, Elton Mayo’s Human Relation's Approach and

Howthome studie emphasizing human relations Utopia, and motivatioanl theories

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of Maslow, McGregor and others. Deming devloped his Quality systems in 1950’s.

During 1960’s & 1970’s stress was on employee maintenance & hygiene

motivation and proper direction through suitably modulated leadership styles. It

followed by development of TQM models in 1980’s & 1990’s.

Japanese economy was depressed after World War II. “Deming’s Quality

systems’’ for problems solving through co-opreation between workers and

management were widely acepted and used by Japanese industry. He said that

quality should be stressed at each step of the manufacturing process and most

product defects and service problems result from in management rather than

from the carelessness of workers. The teachings of Deming led to the revival of

the Japanese economy. Deming prize on Total Quality was introduced in 1951.

By the mid 1970’s Japan was beginning to seriously undermine its American

and other western competitiors first in cars, then in the whole range of goods

including videoes, Hi-fi and electomics.

In the 1980’s major corporations in the United Stetes and other countries

began to adopt his principles. In USA. Malcom Baldrige Award on TQM was

introduced in 1987 followed by intoduction of European Quality Award in 1992

in Europe. In India, Oll-EXIM Award for Business Excellence was intoduced in

1944. In 1990’s Total Qulity Management’ became the globally accepted way

for corporate excellence to gain competitive advantage and thereby ensuring

long-term success by needs of the customers, employees financial & other

stakeholder and the community at large with the organization of world market

and the reform process undertaken by Government of India, the competition is

becoming toughter and the new opportunities are opening up. Only those

organisations that can produce products and services of good qulity at competitive

price can hope to survive and thrive in the changed economic scenario. TQM

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Sefl-Assessment is an integrated, result oriented framework for implementing

and assessing the management practices and results achieved. With this

organisation can achieve

benefits such as increased competitiveness, reduced costs and greter

satisfaction, all leading to better results as clearly evident from the

following quote of CEO, Ford AlexTrotman:

“we are in the era of turbulent competition. TQM will be the

norm rather than the exception, we are in a battle for survival

and total quality is going to short out the winners from the

losers”.

TQM models adopted by various countries are dynamic in nature and

periodically go under review. In year 2000, CII-EXIM New Millennium model for

business Excellence gone through a major change with introduction of RADAR

(Results, Apporach, Deployment, Assessment & Review) for mesurement and

39% change in the areas to address bringing more focussed attention on

performance and organisational excellence. The model is a non-prescriptive

framwork of nine Criteria. Five of these Criteria are Enablers and four are

Results as shown diagrammatically. Model has 1000 points to score, out of

these 500 points are for Enablers criteria and 500 points for Criteria. The points

for each criterion are indicated in the boxes. The Enabler Criteria cover what

an organisation does and Results Critenria cover what an organisation achieves.

The Enablers cause results. The model is based on the premise that:

“Excellent result with respect to, customers, people and Society

are achieved through Leadership driving Policy & Strategy, People,

Partnership & Resources and Processes”.

The focus on Enablers to achieve the Result in the permise is truly in line with

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following Vedic hypns:

11
“Effort is the hall mark of human being”

And also

“Don’t be associated with inaction’

The five Enabler Criteria are leadership, policy & strategy, people,

partnerships & resources and processes. Four result Criteria are Customer

Results, people Results, Society Results and Key performance Results. To

develop the high level meaning each criterion it has a definition and is supported

by a number of sub- criteria. Sub-criteria pose a number of questions, exemplify

the meaning of the sub-criterion. These questions are considered in the course

of an assessment. The nine Criteria in the Model consits of 32 Sub - criterion

and 308 question. Out of these five Enabler Criteria consist of 24 sub- criterion

and 144 questions and four Result Criteria consist of 8 sub-criterion and 164

questions.

The arrows emphasise the dynamic nature of the model. They show

innovation and learning helping to improve enablers that in turn lead to improve

results. It reflects shifts in business emphasis and new management approaches

and ideas. It can be used by any organisation irrespective of country, size,

sector or maturnity in Business Excellence. At the heart of the model lies logic

known as RADAR. The introduction of the RADAR cycle integrates the PDCA (

Plan-Do-Check-Act) Circle from W. Edwards Deming and Walfler M. Shewhart

with the Model. RADAR consists of five elements Result. Approach, Deployment,

Assessment and Redew and is the symbol for making the invisible improvements,

transparent as depicted below;

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 The RADAR Logic

The emphasis of RADAR for continuous efforts to attain excellence in supported

by Vedic hymns as blew:

gtsgfcr %st; -gm, * i

The Fod like hard-working persons. They dislike easygoing and idle people.

Ever - wakeful person attain great happiness prosperity Introduction to

Vedic Philosophy:

It is well established that the universe started with a point of energy exploding in

a “big-bang". This ultimately led to the formation of various elementary particles,

nebulae, stars, planets, galaxies and so on. Vedas (refr Rig-Veda 10-12S-1 to

4) and other Indian scriptures support this fact. Along with it, the complete

knowledge of God was transmitted as “Chhanda” (waveform) and spread out

with the expanding universe. These were"received” by our ancient rishis (sages)

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through meditation and given to the mankind in the form of four Vedas namely -

Rig-Veda, Yajur-Veda, Sama- Veda and Athrva - veda. The Vedas is a collection

of secred texts written in Vedic Sanskrit. Vedas contain the complete knowledge

of and about the almighty God. the Atma (Spirit), and Prakriti (the physical

universe). An important philosophical concept found in the Rig Vedic hymns is

that of Rta, or cosmic order. The hymns claims that the entile universe is governed

by physical as well as moral laws and that no transgression of these laws is

allowed.

Vedic philosophical thought reaches its summit in the Upanishads. There are

14 principal Upanishads. The Upanishads deal with the central philosophical

question. What is the nature of ultimate reallity? What is the essence of humanity?

putting together these two ideas, the essence of humanity and the essence of

the world, the ancient philosophers produced the greatest insight of the

Upanishads.

Thus the modem business management has developed as an independent

science during the last two centuries. On the one side it is divided Into process

of management like planning, organisation, co-ordination, direction and control.

The functions of management on the other side include finance, human

resources, operations, marketing and information technology.

Men, Machine & Material are the foundation stones of modern

management. Ultimately the management skills lie in handling the human side of

the enterprise. If men are managed machines and material can be automatically

managed. Therefore human side plays a key role in business management.

Human behaviour depends upon environment. Environment is founded on

tradition and culture. Tradition and culture developes approaches, attitudes and

mindsets. Management is getting things done through and with people. This is

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further deeply related ethics and philosophy of life. Mahabharat is the great

epic that presents eternal principles of philosophy of life. These principles which

present the essence of Indian Ethos can certainly provide effective tools of

business management. The present study is an attempt to explore through the

text of Mahabharat various concepts which can be advantageously used by

corporate managers in achieving excellence in the new era of liberalisation,

privatization, globalization.

Notes & References:

1. Ghosh, Aurovindo. (1930) Collected works of Yogi Arvind, Arvind Ashram,

Pondicherry, 2001.

2. Swami Vivekanand, (1986) Collected Works of Swami Vivekanand,

Ramkrishna Math, Nagpur.

3. Taylor F. W. (1903) Shop Management, Harper and Row, New York.

4. Taylor F.W. (1911) Principles and Methods of Scientific Management,

Harper and Row, New York

5. Mayo Eton, (1919), Democracy and Freedom, Prentice-Hall, Chicago.

6. Mayo Eton, (1933), The Human Problems of an Industrial Civilization,

Prentice-Hall, Chicago.

7. Mayo Eton, (1945), The Social Problems of an Industrial Civilization,

Prentice-Hall, Chicago.

8. Druker Peter, (2001), 'Effective Executive’, Penguin Books, New Delhi.

9. Druket Peter, (2003), ‘Practice of Management’, Penguin Books, New

Delhi.

10. Chris Argyris, (1998), Personality and Organization, Hardvard Manage­

ment Series, New York.

11. Rennis Likert, (1988), ‘New Patterns of Management European Economy

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 Edition, New Delhi.

12. Douglas McGregor, (1977), The Human Side of the Enterprise Euro­

pean Economy Edition, New Delhi.

13. Asthana (1968), Ground Work of Management, Kitab Mahal, Agra.

14. Koontz & Odonell, (1978), Principles of Management, Prentis Hall, New

Delhi.

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