PRINCIPLE OF MANAGEMENT,Evolution of Management Theory,Chapter 2,Evolution of Management Theory,Job Specialization and the Division of Labor,Adam Smith (18th century economist) Observed that firms manufactured in one of two different ways: - Craft-styleeach worker did all steps. - Productioneach worker specialized in one step.,Job Specialization and the Division of Labor,Adam Smith (18th century economist) Realized that job specialization resulted in much higher efficiency and productivity Breaking down the total job allowed for the division of labor in which workers became very skilled at their specific tasks.,Frederick W Taylor (1856 1917),Father of Scientific Management Published “Principles of Scientific Management” in 1911; The systematic study of the relationships between people and tasks for the purpose of redesigning the work process for higher efficiency.,Frederick W Taylor (1856 1917),Taylor listed “new duties” for management. There were: The development of a true science; The scientific selection, education and development of workmen; Friendly, close co-operation between management and workers.,Four Principles of Scientific Management,1) Study the ways jobs are performed now and determine new ways to do them. Gather detailed time and motion information. Try different methods to see which is best.,Four Principles of Scientific Management,2) Codify the new methods into rules. Teach to all workers the new method.,Four Principles of Scientific Management,Select workers whose skills match the rules. Establish fair levels of performance and pay a premium for higher performance. Workers should benefit from higher output,Administrative Management Theory,Administrative Management The study of how to create an organizational structure that leads to high efficiency and effectiveness.,Max Weber (1864 1920),German sociologist Formulated ideas on ideal management approach for large organization. Developed a set of ideas about the structure of an organization that define what we know as bureaucracy,Max Weber (1864 1920),Max Weber (1864 1920),Webers perspective on administrative management are: A division of labor. In which authority and responsibility are defined very clearly and set out as official duties. Hierarchy of authority. Office or positions are organized in a hierarchy of authority resulting in a chain of command. Formal selection. All employees are selected on the basis of technical qualifications through formal examinations or by education or training.,Max Weber (1864 1920),Webers perspective on administrative management are: Career manager. Managers are professionals who work for fixed salaries and pursue “careers” within their respective fields. They are not “owners” of the units they administer. Formal rules. Administrators should be subject to strict formal rules and other controls regarding the conduct of their official duties.,Henry Fayol (1841 1925),A mining engineer and managing director of a large French company; Published “General and Industrial Management” in 1918;,Henry Fayol (1841 1925),Fayols 14 principles of management 1. Division of Labor. Work should be divided to assist specialization 2. Authority. Authority and responsibility should be equal. 3. Discipline. Discipline helps workers develop obedience, diligence, energy and respect. 4. Unity of Command. No subordinate should report to more than one superior.,Henry Fayol (1841 1925),Fayols 14 principles of management 5. Unity of Direction. All operations with the same objective should have one manager and one plan. 6. Subordination of individual interest to general interest. The interest of one individual or group should not take precedence over the interest of the enterprise as a whole. 7. Remuneration. Remuneration and methods of payment should be fair.,Henry Fayol (1841 1925),Fayols 14 principles of management 8. Centralization. Managers must maintain final responsibility but should delegate certain authority to subordinates. 9. Scalar chain. A clear line of authority or chain of command should extend from the highest to the lowest level of an enterprise. This helps to ensure an orderly flow of information and supplement the principle of unity and command.,Henry Fayol (1841 1925),Fayols 14 principles of management 10. Order. A place for everything and everything in its place. Proper scheduling of work and timetables to complete work are important. This can ensure materials are in the right place at the right time. 11. Equity. Employees should be treated with kindness and justice. 12. Stability of tenure of personnel. Management should work towards obtaining long-term commitments from staff.,Henry Fayol (1841 1925),Fayols 14 principles of management 13. Initiative. Workers should be allowed to conceive and execute plans in order to develop their capacity to the fullest and feel like an active part of the organization. 14. Esprit de corps. Harmony and union help to build the strength of an enterprise. It is an extension of the princ