Week 5: Chapter 9

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Week 5 Chapter 9

• The Human Factor Preparing the Way

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The Human Factor Preparing the Way

• Personnel Management
• Psychology and the Individual
• The Social Problem
• Participative Decision Making

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Personnel Management A Dual Heritage

• One part of personnel management can be found in
  the industrial betterment/welfare movement.
• The other side comes from scientific management
  and the needs for record.

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Personnel Management As Welfare Work

• A number of companies hired a welfare secretary
  to advise management. Their duties were many, and
  in some cases appeared to be paternalistic.
• Many secretaries were female, perhaps because of
  their experience in vocational guidance or social
  work, or perhaps because some of their duties
  resembled a role stereotype of what a woman did
  i.e. administering dining facilities, handling
  illnesses, etc.

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Personnel Management As Welfare Work

• This approach grew out of the Social Gospel
  movement.
• The moral behavior of unmarried females factory
  workers was a concern.
• Early companies establishing welfare offices
• National Cash Register Company in 1897
• John Bancroft and Sons in 1899
• H.J. Heinz Company in 1902
• International Harvester Company in 1903.

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Personnel Management Scientific Management Roots

• Scientific management emphasized
• Personnel selection
• Placement
• Wage plans
• Other issues involving employee welfare.
• Welfare work eventually was replace with
  Employment Management after 1910 as personnel
  practices were standardized and improved.

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Psychology and the Individual

• Wilhelm Wundt pioneered scientific psychology.
• He opened the first laboratory in Leipzig in
  1879.
• He founded experimental psychology, leading to
  applied and industrial psychology.

William Wundt Courtesy of Dr. Charles I. Abramson
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The Birth of Industrial Psychology

• Hugo Munsterberg (1863-1916) applied scientific
  psychology to industrial problems
• Best possible worker
• Best possible work
• Best possible effect
• Munsterberg advocated
• Tests for worker selection
• Research in the learning process in training
• Studied under Wundt

Hugo Munsterberg
9
Foundations of the Social Person Industrial
Sociology

• Whiting Williams (1878-1975)
• Emile Durkheim (1858-1917)
• Charles H. Cooley (1864-1929)
• Gestalt Psychology

Whiting Williams from Weekly London Tabloid,
called 'ANSWERS',  dated 24th February 1934.
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Whiting Williams (1878-1975)

• Williams was a participant-observer. He put on
  the clothes and guise of a worker to study work
  first hand.
• He emphasized the centrality of work.
• He believed
• that the job defines social status as well as a
  persons place in the work situation
• that the workplace is a part of a larger social
  system.

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Whiting Williams

• Williams saw earnings as a matter of social
  comparison influencing how a person viewed
  himself relative to others (similar to equity
  theory).
• The Eleventh Commandment Thou shalt not take
  thy neighbor for granted.
• Summary Industrial sociology began with
  Williams and the Social Gospel influenced his
  thoughts.

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Emile Durkheim Contributions to Sociological
Theory

• Anomie state of confusion, insecurity, and
  normlessness.
• Mechanical societies were dominated by a
  collective consciousness.
• Organic societies were characterized by
  interdependence and the division of labor leading
  to anomie.
• Durkheims thinking influenced the human
  relationists view of the need for social
  solidarity.

Emile Durkheim
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Social Behaviorism

• C. H. Cooley Looking Glass Self is a very
  interesting way of looking at the formation of
  self-efficacy, personality development, and other
  similar ideas.
• Gestalt psychology the whole system is greater
  than the sum of its parts.

Charles H. Cooley
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Employee Participation in Decision Making

• Three paths for giving employees a voice in the
  organization led to the democratization of the
  workplace
• Membership in a union that would represent the
  workers.
• Union-management cooperation
• Employee representation plans.

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The Trade Union Movement and Industrial Relations

• John R. Commons (1862-1945) was the Father of
  Industrial Relations.
• He was probably the first to use the term Human
  Resources.
• He wrote of the need for workers to have a voice
  in the workplace.

John R. Commons, courtesy of the Wisconsin
Electronic Reader
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The Trade Union Movement and Industrial Relations

• John R. Commons admired Taylor.
• He was not anti-scientific management because it
  worked in some firms, but felt workers needed a
  say-so in the workplace.

John R. Commons, courtesy of the Wisconsin
Electronic Reader
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The Trade Union Movement and Industrial Relations

• American Federation of Labor formed under the
  leadership of Samuel Gompers in 1886.
• Goal was to achieve gains for organized labor
  through bargaining power, not productivity.
• Gompers said more, more, and then more was what
  labor wanted.

Samuel Gompers,
courtesy of Library of Congress
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The Era of Union-Management Cooperation

• Morris Cooke, Ordway Tead, and Robert Valentine
  were examples of those who were trying to
  reformulate what labor felt was the unyielding,
  no union, position of scientific management.
• The revised emphasis was to be on consent
• Union-management cooperation plans began when
  union membership was in decline in the early
  1920s. Unions agreed to accept scientific
  management if they were involved by electing
  representatives and could bargain about wages,
  hours working conditions, etc.

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Employee Representation Plans

• Employee representation plans did not involve
  unions but the workers elected representatives
  and participated through shop councils and
  committees.
• Unions did not like these plans, but studies of
  these plans indicated they were progressive and
  improved labor-management relations.

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Summary

• The 1920s was prosperous for employers and
  employees.
• Despite a surplus of labor, employers created
  industrial goodwill with a variety of employee
  benefit programs.
• Scientific Management inspired social scientists
  and psychologists to study the workplace.
• Industrial Sociology began in the 1920s.
• The Social Gospel spawned the industrial
  betterment/welfare movement.

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Week 5, Chapter 10

• Emergence of Management and Organization Theory

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Emergence of Management and Organization Theory

• Henri Fayol Modern approach to general
  management theory through the management process
• Max Weber Bureaucracy to provide a formal
  approach to organization theory

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Henri Fayol (1841-1925)

• Jules Henri Fayol was born to French parents in
  Constantinople.
• His experiences as the Managing Director of
  Comambault formed his conception of management as
  the general activity of integrating functions of
  the firm in order to intelligently use resources
  to attain the objectives of the firm.
• While Taylor was more production oriented,
  Fayols viewpoint was that of general management.

Henri Fayol
Wren, History of Management Thought
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Henry Fayols Conclusions

• Managerial abilities differed from technical
  ones, and the success of the firm depended to a
  greater degree on good managers than good
  technicians.
• Fayol felt that every organization required
  management regardless of whether it was
  commercial, industry, politics, religion, war,
  
• This statement suggests the universality of
  management in that this activity is necessary in
  all organizations.
• It does not mean that managers are universal.

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Fayols List of Managerial Qualities

• Physical qualities health, vigor, address
• Mental qualities ability to understand and
  learn, judgment, mental vigor, and adaptability
• Moral qualities energy, firmness, willingness to
  accept responsibility, initiative, loyalty, tact
  dignity
• General education general acquaintance with
  matters not belonging exclusively to the function
  performed
• Special knowledge that peculiar to the function,
  be it technical, commercial, financial,
  managerial, etc.
• Experience knowledge arising from the work
  proper the recollection of lessons a person has
  derived from things

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Henry Fayols Conclusions

• Managerial abilities become more important as a
  person moves up in the hierarchy.
• Technical abilities are less essential for upper
  level managers.
• Management could be taught in schools and
  universities but was not because of the absence
  of management theory.
• Fayol defined management theory as a collection
  of principles, rules, methods, and procedures
  tried and checked by general experience. (Fayol,
  1949, p. 15)

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Fayols Principles of Management

1. Division of work
2. Authority
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination of individual interests to the
   general interest
7. Remuneration
8. Centralization
9. Scalar Chain
10. Order
11. Equity
12. Stability of tenure of personnel
13. Initiative
14. Esprit de corps

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Fayols Principles of Management

• Keep in mind that there is nothing rigid in
  management. Fayols principles were guides, not
  absolutes or universals.
• We will not stress each principlethe following
  is a discussion of a few key ones.

Henri Fayol
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Fayols Principles of Management

• Division of Labor Fayol is rather traditional
  here regarding work design. However, he also used
  job enlargement when appropriate.
• Authority Fayol distinguished between formal
  authority and personal authority. He was aware of
  the need to combine and complement the authority
  of position with leadership qualities.
• Authority must be commensurate with
  responsibility.

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Fayols Principles of Management

• Unity of command Fayol felt that employees
  should receive supervision from only one person.
• Unity of direction one head and one plan for a
  group of activities having the same objective
  (Fayol, 1949, p. 32). This is still good advice
  for many organizations today.
• Centralization This is not centralized decision
  making. Instead it is finding where decisions
  should be made depending on the factors Fayol
  mentioned. (See Wren text for Fayols excellent
  discussion.)

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Scalar Chain and the Gangplank

• The gangplank is a means for providing lateral
  communications.
• The Foreman (F) wishing to communicate with
  Foreman (P) without reporting upward through the
  President (A) can use a gangplank to bypass
  organizational red tape.

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Figure 10.1 - Scalar Chain and the Gangplank
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Fayols Elements of Management

• Planning (could also be translated as foresight)
• Plans depended on the firms resources, work in
  process, and future trends that could not be
  predetermined (resembled a strategic audit).
• Plans needed to have the characteristics of
  unity, continuity, flexibility, and precisions.
• Long range planning was a unique idea for his
  time but a valuable contribution to the evolution
  of strategic management.

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Fayols Elements of Management

• Organizing Fayol included both the design of
  the organization and the staffing job of the
  manager in this element.
• Structure of the organization had to be
  consistent with the objectives, resources, and
  requirements of the firm
• Functional (horizontal) and scalar (vertical)
  growth
• Span of control narrow at the top but greater
  at lower levels
• Staff advisory personnel are needed by line
  managers
• Staffing (separate issue from staff above)
  involved selection, evaluation, and training of
  personnel.

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Fayols Elements of Management

• Command Fayols term for directing, leading,
  supervising, etc.
• Coordination harmonizing the activities of the
  organization
• Control checking on performance to identify and
  make corrections if necessary

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Fayols Elements of Management

• Fayol spent relatively little time discussing
  command, coordination, and control.
• Planning, organizing, and staffing set the stage
  for where we are going and when and how we intend
  to get there.
• These plans, people, and resources are activated,
  led, motivated, and coordinated.
• As our information system brings us performance
  data, the control element enables management to
  renew the elements by reorganizing or whatever is
  indicated by our control system.

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Fayols Elements of Management

• Management is a continuous process, not a neat
  set of discrete elements and functions that are
  performed without coordination of other elements.
• Fayols perspective was that of a strategist.

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Max Weber (1864-1920) Bureaucracy

• Webers Germany was characterized by cartels
  which limited competition (anti-trust laws
  limited this in the U.S.).
• To Weber, capitalism in the US encouraged
  innovation and competition.

Max Weber
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Max Weber and Bureaucracy

• His interest in the U.S. Capitalistic spirit led
  him to ask
• If a market oriented society could operate large
  organizations on some rational, systematic basis?

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Bureaucracy as a Theory

• It was management by the office not by a person.
• It was an ideal, the pure form of
  organization but this did not mean that it was
  the most desirable.
• Weber is suggested as the Founder of
  Organization Theory.

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Three Pure Types of Legitimate Authority

• Rational-legal right of those elevated to
  authorityto issue commands.
• Traditional rested on the belief in the
  sanctity of immemorial traditions and the
  legitimacy of the status of those exercising
  authority under them.
• Charismatic based on devotion to the specific
  and exceptional sanctity, heroism, or exemplary
  character of an individual person. (Weber, 1947,
  p. 328)
• Weber believed that rational type of authority
  must be the basis for a bureaucracy.

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Elements of Bureaucracy

• The division of labor and authority and
  responsibility were clearly defined for each
  member and were legitimatized as official duties.
• Offices or positions were organized in a
  hierarchy of authority resulting in a chain of
  command or the scalar principle.
• All organizational members were selected on the
  basis of technical qualifications through formal
  examinations or by virtue of training or
  education.

Max Weber
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Webers Elements of a Bureaucracy

• Officials were appointed, not elected.
• Administrative officials worked for fixed
  salaries and were career officials.
• Administrative officials were not owners of the
  units they administered.
• Administrators were subject to strict rules,
  discipline, and controls regarding the conduct of
  their official duties. These rules and controls
  were impersonal and uniformly applied in all
  cases.

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Summary

• The emergence of management and organization
  theory had two forms
• Fayols principles and elements of management
• Webers rationalized organization structure for
  efficiency
• Fayol stressed planning and organizing , and
  education for management.
• Weber sought leadership based on rational-legal
  authority, not tradition or charisma.