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Development of Management Theories

Why Management Theory?

A Theory is a coherent group of assumptions put forth to explain the relationship between two or more observable facts and provide a sound basis for predicting future events.

Theories are perspectives with which people make sense of their world experience.

A theory, by definition, has boundary; once we are aware of it, weask ourselves if there are other alternative ways of looking at the fact.

Early Thinking about Management

Sun Tzu: The Art of War China, 2000 years ago
1. When the enemy advances, we retreat;
2. When the enemy halts, we harass[1];
3. When the enemy seeks to avoid battle, we attack;
4. When the enemy retreats, we peruse.

Niccolo Machiavelli – 1531
1. Anorganisation is more stable if member have the right to express their differences and solve their conflicts within it.
2. While one person can began an organisation, it is lasting when it is left in the care of many and when many desire to maintain it.
3. A weak manager can follow a strong one, but not another weak one and maintain authority.
4. A manager seeking to change an establishedorganisation “should retain at least a shadow of ancient customs.”

Classical Theories:

The classical theories represent departure from the traditional management. The 18th and 19th centuries' industrial revolution necessitated the need for systematic thinking on how people and resources should be managed. The modern factories and mass production could no longer be effectively managed by thetraditional ways. Thus, thinkers like Fredric W. Taylor (1856-1915), Henry L. Gantt (1861-1919), and Frank and Lillian Gilbreth (1861-1924, 1878-1972) started to devote their time and energy to thinking, designing and experimenting on new theories and practices of management. The classical management theories are the outcomes of these intellectual efforts. The classical theories are further dividedinto two subcategories as:

4 The Classical Scientific Management Theories:

This is a transition from traditional management practices to systematically studying management problems and practices. Under traditional management, every single person tends to do the whole production. Such a management system is unproductive, time and resource consuming and inappropriate for modern industrialmass production of commodities and services.

In the 19th century, people such as Taylor suggested that work should be broken down into smaller tasks and workers should be trained to perform specific tasks rather than attempting to master the whole art. After a worker has completed his or her specific task, the product passes to the next worker who has specialized in that job. Generally, workshould be organized like technical jobs are organized in factories on a conniver belt. Payment is done based on the work done. For each task, there is a standard and when a worker meets or surpasses the standards he or she will be rewarded.

According to Taylor the major responsibilities of the managers should be in
1) selecting the right person for each task,
2) training theworkers for specific tasks, and
3) motivating workers by introducing standards, and by rewarding achievements and punishing substandard performances.

Taylor’s Basic Principles of scientific management.
1) the development of a true science of management, so that the best method for performing each task could be determined.
2) The scientific selection of workers, so that eachworker would be given responsibility for the task he or she was best suited.
3) The scientific education and development of the worker.
4) Intimate, friendly cooperation between management and labor.

Taylor’s compensation system involves higher wages for more efficient workers. Taylor called his plan differentiated rate system.

Henry L. Gantt has improved Taylor's theory by...
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