MANAGEMENT HISTORY

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MANAGEMENT HISTORY

• MIM332E

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• What is management getting things done through
  other people
• What can history tell us?
• Knowledge of management history can increase
  understanding of management theory and practice
• Earliest forms of Management
• Pyramids Great
  wall of China

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History Management

• Studying history is a way to achieve strategic
  thinking, see the big picture, and improve
  conceptual skills.
• Before Industrial Revolution, organizational
  scale in economic undertakings was small.
• Neverthless, there was still a need for
  management in the conduct of military campaigns,
  in household affairs, and in the administartion
  of government.

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The Near East Priest-Ruler

• One such divine king was the Babylonian
  Hammurabi, who received his right to rule and his
  code of laws from the sun god. In 2250 BC,
  Hammurabi issued a code of 282 laws, which
  governed business dealings, personal behavior,
  interpersonal relations, wages, punishments, and
  a host of other societal matters.

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The Near East Priest-Ruler

• Law 104, for examle, was the first mention of
  accounting. It dealt with the handling receipts
  and established an agency relationship between
  the merchant and the agent.
• Law 229 If a builder builds a house for a man
  and does not make its construction firm, and the
  house collapses, and causes the death of the
  owner, that builder shall be put to death.

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The Far East Philosophical Foundations of
Management

• Chinese general Sun Tzu (600 BC)
• Structuring of army into subdivisions,
  gradations of rank among the officers, using
  gongs, flags, and signal fires for communications.

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The Far East Philosophical Foundations of
Management

• Planning for the battle
• If our forces are ten to the enemys one,
  surround them. If five to one, attack them. If
  twice as numerous, divide our army in two, one to
  meet the enemy in front and the other fall upon
  their rear. If equally matched, we can offer
  battle. If slightly inferior in number, we can
  avoid the enemy. If quite unequal in every way,
  we can flee from them.

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The Far East Philosophical Foundations of
Management

• Confucius (552-479 BC) Merit system
• Govenment offices should go to individuals of
  proven merit and ability. Merit exams, based on
  Confucian advice, began during the Han dynasty
  (206BC-220AD). Merit as a basis for selection
  would in time lead to merit rating (performance
  appraisal) for promotions. The Sung dynasty
  started a merit rating system around AD 962.

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The Far East Philosophical Foundations of
Management

• There is evidence that the Chinese were familiar
  with the division of labor and the departmental
  form of organization as early as AD 1. An
  inscription on a rice bowl indicates that it was
  made in a government workshop in which there was
  a high degree of specilization of labor among the
  various artisans. The workshop was divided into
  three departments accounting, security, and
  production.

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Egypt The Rule of Ten

• Egyptians were aware of limits to the number of
  people one manager could supervise. There was a
  ratio of about ten servants to each supervisor.
  There were distinctive dressing for managers and
  workers. The supervisors wore kilts or
  ropbes,while the latter were dressed so as to
  represent their trade or occupation.

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EVOLUTION OF MODERN MANAGEMENT
1. CLASSICAL APPROACHES 2. HUMAN
RELATIONS APPROACHES 3. POST-1945
APPROACHES
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Classical Approaches to Management
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SCIENTIFIC MANAGEMENT

• Underlying Assumptions
• There is One Best Way to do a job
• Workers are primarily motivated by increased
  earnings

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SCIENTIFIC MANAGEMENT

• 1. There is One Best Way to do a job
• By applying scientific methods of analysis, it is
  possible to breakdown the work into tasks and
  subtasks and rearrange them into the most
  efficient method of working

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SCIENTIFIC MANAGEMENT

• 2. Workers are primarily motivated by increased
  earnings.
• By finding the best way of producing,
  productivity will rise and so workers should
  receive better wages.
• This is the basis of the argument that
  scientific management uses money as a motivator
  for workers.

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Taylors Five Principles of Management

• Develop standard methods for performing each job
• Select workers with appropriate abilities for
  each job
• Train workers in standard methods
• Support workers eliminate interruptions
• Provide wage incentives

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ADMINISTRATIVE PRINCIPLES

• Henry Fayol French Mining Engineer
• concerned with making the overall organization
  more effective
• developed theories of what constituted good
  management practice
• proposed a universal set of management functions
• published principles of management
• fundamental, teachable rules of management

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Fayols 14 Principles of Management

• Division of Work
• Authority
• Discipline
• Unity of Command
• Unity of Direction (One Boss)
• Subordination of Interests
• Remuneration

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Fayols 14 Principles of Management

• Centralization
• Scalar Chain (Clear Boxes)
• Order
• Equity
• Stability of Personnel
• Initiative
• Esprit De Corps

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Centralization and Decentralization
DEGREE OF CENTRALIZATION
DEGREE OF DECENTRALIZATION
Judging by the size of the desk, where do
decisions get made? Which organization looks more
appealing to you?
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BUREAUCRATIC ORGANIZATIONS

• A systematic approach that looked at the
  organizations as a whole is the bureaucratic
  organizations approach, developed by the German
  theorist Max Weber.
• During the late 19th century many business
  organizations were still managed on a personal,
  familiy-like basis. Employees were loyal to a
  single individual rather than to the organization
  or its mission.

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BUREAUCRATIC ORGANIZATIONS

• Principles of Bureaucracy
• A managers formal authority derives from the
  position he or she holds in the organiztion
• People should occupy positions because of their
  performance, not because of their social standing
  or personal contacts
• The extend of positions formal authority and
  task responsibilities, and its relationship to
  other positions in an organization, should be
  clearly specified.
• So that authority can be exercised effectively in
  an organization, positions should be arranged
  hierarhically, so employees know whom to report
  and who reports to them.
• Managers must create a well-defined system of
  rules, standard operating procedures, and norms
  so that they can effectively control behavior
  within an organization.

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United Parcel Service

• UPS specializes in the delivery of small
  packages. Why has the Brown Giant been so
  successful?
• One important reason is the concept of
  bureaucracy. UPS is bound up in rules and
  regulations. There are safety rules for drivers,
  loaders, clerks, and managers. Strict dress codes
  are enforced- no beards hair cannot touch the
  collar mustaches must be trimmed evenly and no
  sideburns. Rules specify cleanliness standards
  for buildings and other properties.

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United Parcel Service (cont.)

• No drinking or eating is permitted at employee
  desks. Every manager is given bound copies of
  policy books and expected to use them regularly.
• UPS also has a well-defined division of labor.
  Each plant consists of specialized drivers,
  loaders, clerks, washers, sorters, and
  maintenance personnel. UPS thrives on written
  records. Daily worksheets specify performance
  goals and work output. Daily employee quotas and
  achievements are reported on a weekly and monthly
  basis.

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United Parcel Service

• Technical qualification is the criterion for
  hiring and promotion. The UPS policy book says
  the leader is expected to have the knowledge and
  capacity to justify the position of leadership.
  Favoritism is forbidden. The bureaucratic model
  works just fine at UPS, the tightest ship in the
  shipping business.

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HUMAN RELATIONS APPROACH

• Hawthorne Studies
• started in 1924 at Western Electric Company
• began with illumination studies
• intensity of illumination not related to
  productivity
• Elton Mayo studies of job design
• looked at the importance of social norms as
  determinants of individual work behavior
• changed the view of workers as machines

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Hawthorne Studies

• This research began as an attempt to investigate
  how the level of lighting or illumination affect
  worker performance.
• The researchers found that regardless of whether
  they raised or lowered the level of illumination,
  productivity increased.
• It was found that employees performed better when
  managers treated them in a positive manner.

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POST-1945 APPROACHES

• System Theory
• Contingency Theory
• Total Quality Management