Management, 14e

Chapter 2: The Evolution of

Management Thinking

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 Icebreaker

Big data analytics programs (which analyze massive data sets to

make decisions) use gigantic computing power to quantify trends that
would be beyond the grasp of human observers. Businesses then use
these data to make decisions about products and marketing.
• Pair up with another student and discuss the following, or reflect
individually on these points:
− Specify one or two examples, either positive or negative, of how
big analytics has changed your life.
− Overall, do you see analytics as positive or negative for
managers?

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 Learning Objectives (1 of 2)

• By the end of this chapter you should be able to:

1. Summarize the historical struggle between managing the
“things of production” and the “humanity of production.”
2. Describe the major components of the classical perspective
and current uses of the management science approach.
3. Describe the major components of the humanistic
management perspective.

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 Learning Objectives (2 of 2)

• By the end of this chapter you should be able to:

5. Explain recent historical trends, including the major concepts
of systems thinking and the contingency view.
6. Describe the management changes brought about by a
technology-driven workplace and those that facilitate a
people-driven workplace.
7. Explain how artificial intelligence may help bridge the
historical struggle between managing the “things of
production” and the “humanity of production.”

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 Management and Organization
(LO 1)

• Studying management history helps you understand the impact of social forces
on organizations
• Factors affect management practices and perspectives
− Social forces
− Political forces
− Economic forces

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2.1 Management Perspectives over Time
(LO 1)

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2.2 Tension Between Historical Forces
(LO 1)

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 Classical Perspective
(LO 2)

• Emerged during the nineteenth and early twentieth centuries during rise of the
factory system
• Large, complex organizations required new approaches to coordination and
control
• Four subfields:

− Scientific management − Administrative principles

− Bureaucratic organizations − Management science

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 Scientific Management
(LO 2)

• Improve efficiency and labor productivity through scientific methods

• Frederick Winslow Taylor proposed that workers “could be retooled like
machines”
− Management decisions would be based on precise procedures based on
study

• Henry Gantt developed the Gantt chart, a bar graph that measures
planned and completed work
• The Gilbreths pioneered time and motion studies to promote efficiency

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2.3 Characteristics of Scientific Management
(LO 2)

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 Discussion Activity 1

• Do you believe that scientific management characteristics will ever cease to be

a part of organizational life, since they are now about 100 years old?
• Consider:
− how economic factors influence the use of scientific management practices
− how political factors influence the use of scientific management practices
− how social factors influence the use of scientific management practices

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 Discussion Activity 1 Debrief
• Do you believe that scientific management characteristics will ever cease
to be a part of organizational life, since they are now about 100 years old?
 This approach to management was powerful and gave companies fundamental
new skills for establishing high productivity and effective treatment of employees.
Indeed, these management techniques, and other countries, especially Japan,
borrowed heavily from American ideas.

− Economic factors: Consider the state of the economy, the availability of workers,
and the organization’s financial health

− Political factors: Consider the levels of regulation and taxation and how they
influence organization and management goals

− Social factors: Consider the culture and how workers’ rights and needs are
currently viewed
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 Knowledge Check 1

Which of the following is a main criticism of scientific management?

a. Workers’ internal motivation is overly influential in scientific
management’s design of job methods
b. The consideration of social context under scientific
management can be the impetus for conflict between managers
and employees
c. Scientific management fails to take into account worker skills
and training
d. Scientific management develops a standard method for each
job
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 Knowledge Check 1: Answer

Which of the following is a main criticism of scientific management?

b. The consideration of social context under scientific
management can be the impetus for conflict between managers
and employees

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 Bureaucratic Organizations
(LO 2)

• Organization depends on rules and records

• Max Weber, a German theorist, introduced the concepts
• Manage organizations on impersonal, rational basis
• Managers use power instead of personality to delegate
• Although important productivity gains come from this approach,
bureaucracy has taken on a negative tone

15

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2.4 Characteristics of Weberian Bureaucracy
(LO 2)

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 Administrative Principles
(LO 2)

• Focused on the entire organization

• Henri Fayol, a major contributor, listed 14 general principles of management
− Many still used today: unity of command; division of work; unity of direction;
and scalar chain
− Identified five functions of management: planning, organizing, commanding,
coordinating, and controlling
• Charles Clinton Spaulding, another a major contributor, outlined eight
fundamental necessities, including
− Authority and responsibility; division of labor; adequate manpower; and
cooperation and work 17

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 Management Science (slide 1 of 2)
(LO 2)

• Also referred to as quantitative perspective

• Applies mathematics, statistics, and other quantitative techniques to
management decision making and problem solving
• Developed for the military during World War II
− Enhanced by development of the computer
• Widely used today

18

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 Management Science (slide 2 of 2)
(LO 2)

• Subsets of management science

− Operations research: mathematics model building
− Operations management: management field specializing in physical
production of goods
− Information technology (IT): focuses on technology and software to aid
managers
• Digital organization: organization that uses technology as primary competitive
tool
• Quants: financial managers who base decisions on complex quantitative
analysis 19

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 Humanistic Perspective: Early Advocates
(LO 3)

• Understand human behaviors, needs, and attitudes in the workplace

• Contrast to scientific management—importance of people rather than
engineering techniques
• Mary Parker Follett and Chester Barnard
− Empowerment: facilitating instead of controlling employees
− Informal organization: cliques, informal networks, and social groupings
− Acceptance theory of authority: people can choose to follow management
orders
20

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 Humanistic Perspective: Human Relations
Movement (LO 3)
• Effective control comes from within the employee
• Hawthorne studies were key contributor
• Human relations played key variable in increasing performance
• Employees perform better when managers treat them positively
• Shaped management practice and research

21

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 Humanistic Perspective: Human Resources
Perspective (LO 3)
• Satisfied workers produce more work
• Allows workers to use their full potential
− Shifted emphasis to workers’ daily tasks
− Combined job design and motivation
• Maslow created a hierarchy of needs
• McGregor formulated Theory X and Theory Y about workers’ motivation

22

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 Knowledge Check 2

The Hawthorne effect is most likely to be a factor in which of the

following examples?
a. A study uses more than one experimental group, all of which
show different outcomes
b. A study uses more than one control group that exhibit similar
outcomes
c. A study involves numerous experimental and control groups,
none of which shows consistent data
d. A study involves one experimental group and one control group,
but only the control group knows they are being observed
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 Knowledge Check 2: Answer

The Hawthorne effect is most likely to be a factor in which of the

following examples?
d. A study involves one experimental group and one control group, but
only the control group knows they are being observed

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 2.5 Theory X and Theory Y
(LO 3)

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 Polling Activity 1
You have an employee who is not performing up to the potential you believe
the person showed initially after being hired. As a proponent of Theory Y
management, which of the following approaches would you take?
a. Wait until the employee’s performance review to discuss the situation in
the event it is due to a personal, rather than organizational, matter
b. Call in the employee in to review progress toward previously stated
performance goals
c. Indicate to the employee that he/she has been put on probation,
according to company policy

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 Humanistic Perspective: Behavioral
Sciences Approach (LO 3)
• Scientific methods + sociology, psychology, anthropology, economics, and
others to develop theories about human behavior and interaction in an
organizational setting
• Organization development (OD): set of management techniques that uses
behavioral sciences to improve organization’s health and effectiveness
• Other strategies based on behavioral sciences
– Matrix organizations – Corporate culture
– Self-managed teams – Management by wandering around

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 Recent Trends: Systems Thinking
(LO 4)

• The ability to see the distinct elements of a situation as well as the

complexities
• System: set of interrelated parts that function as a whole to achieve a
common purpose
• Subsystems: parts of a system that depend on one another
• Synergy: the whole is greater than the sum of its parts
• Managers must understand subsystem interdependence and synergy

28

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 Polling Activity 2

You are struggling to maintain a C+ in your cost accounting class. You want
to apply a systems thinking approach to see if you can improve your grade.
Which of the following steps would you take?
a. Set aside 60 minutes every day to review your notes from class
b. Complete all the practice exercises in the current chapter, even
those not assigned by the professor
c. Create or join a study group with two or three other students to
discuss concepts and keep each other accountable

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 2.6 Circles of Causality
(LO 4)

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 Recent Trends: Contingency View
(LO 4)

• Every situation is unique

− Opposite of universalist view of the classical perspective
• Managers must determine what method will work in every new situation
• Managers must identify key contingencies for the current situation
• Organizational structure should depend upon industry and other variables

31

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2.7 Contingency View of Management
(LO 4)

32

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Managing New Technology-Driven Workplace
(LO 5)

• Big data analytics: technologies, skills, and processes for searching and
examining massive, complex sets of data to uncover hidden patterns and
correlations
− Descendant of scientific management and recent iteration of quantitative
approach
• Internet of things (IoT): “smart” devices and chips that communicate to other
devices
− Helps with managing the supply chain, or the sequence of suppliers and
purchasers
− Covers all stages of processing 33

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2.8 A Platform-Based Digital Organization
(LO 5)

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 Managing New People-Driven Workplace
(LO 5)

• Radical decentralization: employees have authority to make key decision

about their work, eliminating much of hierarchical reporting
− Employees flourish when given more responsibility and control over their
own work
− Higher levels of employee energy, passion, and creativity when decision
making closer to work being done
• Employee engagement: organizational culture supports employees’ sense of
belonging and commitment to the organization and its mission

35

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 Historical Struggle: Artificial Intelligence
(LO 6)

• Artificial intelligence (AI): techniques by which computer systems learn,

communicate, and make decisions similar to or better than human beings can
− does the work that humans find unsatisfying
− allows humans to focus on work that involves more thinking and analysis
• Nudge management: applying behavioral science insights in organizational
design to guide people toward behaviors that support organizational goals and
values
− uses digital technology

36

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 Discussion Activity 2

• One of the ways nudge management is used is through sending digital

nudges to employees via e-mail or text messages. What do you see as the
most important ways for managers to use this technology?
• Discuss some of the potential positive and negative aspects of nudge
management.

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 Discussion Activity 2 Debrief
• One of the ways nudge management is used is through sending digital
nudges to employees via e-mail or text messages. What do you see as the
most important ways for managers to use this technology?
− Managers can design elements of the organization in a way that guides people
toward behaviors that support organizational goals and values
− New digital technology can be used to nudge people toward desired behaviors

• Discuss some of the potential positive and negative aspects of nudge

management.
− Advantages: low implementation cost is low, high public support, and beneficial
behavior changes
− Disadvantages: impact varies and can be unpredictable based on individuals’
knowledge, beliefs, socioeconomic situation, and behavioral biases

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 Summary (1 of 2)

• Now that the lesson has ended, you should have learned how to:
1. Summarize the historical struggle between managing the
“things of production” and the “humanity of production.”
2. Describe the major components of the classical perspective
and current uses of the management science approach.
3. Describe the major components of the humanistic
management perspective.

©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 39
 Summary (2 of 2)

• Now that the lesson has ended, you should have learned how to:
5. Explain recent historical trends, including the major concepts of systems
thinking and the contingency view.
6. Describe the management changes brought about by a technology-driven
workplace and those that facilitate a people-driven workplace.
7. Explain how artificial intelligence may help bridge the historical struggle
between managing the “things of production” and the “humanity of
production.”

©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 40