Evolution

of
Management
Thought

Chapter 2
 Evolution
of
Management
thought
 Early Approach to Management
(1771-1924)
*Robert Owen: (1771-1858)
Human Resource Management Pioneer
*Charles Babbage: (1792-1871)
Inventor and Management Scientist
Andrew Ure: (1778-1857)
& Charles Dupin: (1784-1873)
Management Education Pioneers
Henry Robinson Towne: (1844-1924)
“Engineer as an Economist”
Robert Owen (1771-1858)

Charles Babbage: (1792-1871)

Evolution
of
Andrew Ure: (1778-1857)
Management
thought Charles Dupin: (1784-1873)

Henry Robinson Towne: (1844-1924)

Classical Approach (1856-1920) Classical Approach
-Scientific Management
*Frederick Winslow Taylor
Frank Gilbreth (1868-1924) *Frank & Lillian Gilbreth
*Henry Laurence Gantt
-Administrative Theory
Henry Laurence Gantt (1861-1919)
*Henri Fayol:(1841-1925)
Administrative Theory
-Bureaucratic Management

Bureaucratic Management

Evolution
of
Management
thought
 Evolution Behavioral Approach
Behavioral Approach of Mary Parker Follet:(1868-1933)
Mary Parker Follet Management Focusing on Group Influences
Elton Mayo thought Elton Mayo:(1880-1949)
Focusing on Human Relations
Abraham Maslow
Abraham Maslow:(1908-1970)
Focusing on Human Needs
Douglas McGregor

Chris Argyris
Douglas McGregor:(1906-1964)
Traditional Assumption about
Employees
Chris Argyris: Matching Human
& Organizational Development
 Quantitative Approach -
Overview
Management Science

Operations Management

Management Information System

s

Evolution
of
Management
thought

Quantitative Approach:
-Management Science
-Operations Management
-Management Information systems
 Modern Evolution
Approach of
to Management
Management: thought
-Systems theory
-Contingency
theory
 Emerging
Approaches in
Management
Thought:
-Theory Z
-Quality
Management

Evolution
of
Management
thought
 Early Approach to Management
(1771-1924)
*Robert Owen: (1771-1858) Classical Approach
Human Resource Management Pioneer
-Scientific Management
*Charles Babbage: (1792-1871)
Emerging Inventor and Management Scientist
*Frederick Winslow Taylor
Approaches in Andrew Ure: (1778-1857) *Frank & Lillian Gilbreth
Management & Charles Dupin: (1784-1873) *Henry Laurence Gantt
Management Education Pioneers -Administrative Theory
Thought: Henry Robinson Towne: (1844-1924) *Henri Fayol:(1841-1925)
-Theory Z “Engineer as an Economist” -Bureaucratic Management
-Quality
Management

Modern Evolution Behavioral Approach

Approach of Mary Parker Follet:(1868-1933)
to Management Focusing on Group Influences
Management: thought Elton Mayo:(1880-1949)
-Systems theory
Focusing on Human Relations
-Contingency
Abraham Maslow:(1908-1970)
theory
Focusing on Human Needs
Douglas McGregor:(1906-1964)
Quantitative Approach: Traditional Assumption about
-Management Science Employees
-Operations Management Chris Argyris: Matching Human
-Management Information systems & Organizational Development
 Early Approaches to
Management(1771-1921)
The Industrial Revolution, which began in
Europe in the mid-1700s, was the
starting point for the development of
management concepts and theories
The rapid growth in the number of
factories during this period and the need
to coordinate the efforts of large number
of people in the production process
necessitated the development of
management theories and principles
Slide 3
 Robert Owen (1771-1858)

Human Resource Management Pioneer Mary Parker Follet:(1868-1933)

A successful British entrepreneur in the early 19th

century
He was one of the earliest management thinkers to
realize the significance of human resources
He believed that workers’ performance was influenced
by the environment in which they worked
He introduced a standard working day of 10½ hours
and refused to employ children under the age of ten

Slide 3
 Charles Babbage: (1792-1871)
Inventor and Management Scientist
British professor of Mathematics is widely
known as the “father of modern
computing”.
Mathematics professor publicly supported
the idea of division of labor
He was impressed by the work
specialization (the degree to which work
is divided into various tasks)
 Charles Babbage: (contd)
The management scientist believed that each
factory operation should be thoroughly
understood so that the necessary skill involved
in each operation could be isolated
Each operation could then be trained in one
specific skill and made responsible only for that
part of the operation
Babbage felt that work specialization would
reduce training time and improve (through
constant repetition of each operation) the skills
and efficiency of workers Slide 3
 Andrew Ure: (1778-1857)
British academician who taught at
Glasgow University, published the
philosophy of Manufacturing
Philosophy of Manufacturing explains the
various principles and concepts of
manufacturing
It is in 1771 the wheel was invented and
an academician (an art / science teacher-
professor) is talking of production or
manufacturing (to produce goods in large
numbers, usually in a factory using
machines Slide 3
 Charles Dupin: (1784-1873)
A French Engineer –an early proponent of
the study of management
In 1819, Dupin was appointed as a
management professor in Paris, which
marked the beginning of an illustrious
career
His writings, well-known throughout
France, may have influenced Henry
Fayol’s contributions to the theory of
management Slide 3
Henry Robinson Towne: (1844-1924)
Henry R Towne, President of the Yale and
Towne manufacturing company and a
mechanical engineer, realized that good
business skills were essential for running a
business
He emphasized the need to consider
management as a separate field of systematic
study on the same level as engineering
In the paper, "The Engineer as an Economist,”
presented in 1886,
Slide 3
 Early Approaches to Management
The early pioneers (preclassical theorist):
– generally tried to find solution to
contemporary (of yester years) managerial
problems
– with their technical backgrounds did not
regard management as a separate field of
study Slide 4

– Ideas did lay the foundation for the

management theories (a theory is a
conceptual framework for organizing
knowledge that provides a blueprint for
various courses of action) of the 1900s
Classical Approach (1856-1920)
Classical theorists formulated principles
for setting up and managing
organizations
These views are labeled “ classical”
because they form the foundation for the
field of management thought
In this approach we have three schools of
thought:
Scientific Management
Administrative theory
Bureaucratic management
Scientific Management (1856-1919)
Scientific Management was defined as that kind
of management which conducts a business or
affairs by:
Facts
Truths gained through systematic observation
Experiment
Reasoning
In other words, it is a scientific study of work
methods to improve the efficiency of the
workers
The major contributors to the three schools of
thought- scientific management, administrative
theory and bureaucratic management- are
Frederick W Taylor, Henry Fayol and Max
Weber respectively
Frederick Winslow Taylor (1856-1915)
Frederick Winslow Taylor took up Henry
Towne’s challenge to develop principles of
scientific management
Taylor, considered “father of scientific
management”, wrote The principles of Scientific
Management in 1911
An engineer and inventor, Taylor first began to
experiment with new managerial concepts in
1878 while employed at the Midvale Steel Co.
At Midvale, his rise from laborer to chief
engineer with in 6 years gave him the
opportunity to tackle a grave issue faced by the
organization-the soldering problem
 Soldiering
Refers to the practice of employees
deliberately working at a pace slower
than their capabilities
(why) Workers indulge in soldiering (?)
for the following three main reasons:
Workers feared that if they increased their
productivity, other workers would lose their jobs
Faulty wage systems employed by the
organization encouraged them to work at a slow
pace
Outdated methods of working handed down from
generation to generation led to a great deal of
wasted efforts
 Scientific Methods

The scientific management approach involved

using scientific methods to determine
How a task has to be done instead of depending on the
previous experience of the concerned worker
In short, scientific management as per Taylor:
Need for developing a scientific way of performing each job
Training and preparing workers to perform that particular
job
Establishing harmonious relations between management
and workers so that the job is performed in the desired way
 Then how to do it?
Piece –rate incentive system:
– Under this system:
A worker who met the established standards of performance
would earn the basic wage rate set by management
If the worker’s output exceeded the set target, his wages
would increase proportionately
– The aim of this system was to reward the worker
who produced the maximum output
Time-and-motion study:
– In a “time –and-motion” study, jobs are broken
down into various small tasks or motions and
unnecessary motions are removed to find out the
best way of doing a job
– The objective of a time-and-motion analysis is to
ascertain a simpler, easier and better way of
performing a work or job Slide 4
 Frank Gilbreth (1868-1924)
Frank Gilbreth is considered the “father of
motion study.”
Motion study involves finding out the best
sequence and minimum number of motions
needed to complete a task
Frank Gilbreth also developed the micro-motion
study:
– A motion picture camera and a clock marked off in
hundredths of seconds was used to study motions
made by worker as they performed their tasks
– He is known for his experiments in reducing the
number of motions in bricklaying
 Lillian Gilbreth (1878-1972)
She was associated with the research
pertaining to motion studies
Frank and Lillian Gilbreth were mainly
involved in exploring new ways for
eliminating unnecessary motions and
reducing work fatigue
Lillian had great interest in the human
implication of scientific management and
focused her attention on designing
methods for improving the efficiency of
workers Slide 4
Henry Laurence Gantt (1861-1919)

Henry Laurence Gantt was a close

associate of Taylor at Midvale and
Bethlehem steel
He is probably best remembered for his
work on:
The task-and-bonus (incentive plan) system
The Gantt chart
 Gantt’s incentive plan
Under Gantt’s incentive plan:
– If the worker completed the work fast, i.e. in
less than the standard time, he received a
bonus.
– He also introduced an incentive plan for
foreman, who would be paid a bonus for every
worker who reached the daily standard
– If all the workers under a foreman reached the
daily standard, he would receive an extra
bonus
Gantt felt that this system would motivate foreman
to train worker to perform their tasks efficiently
 Gantt Chart
A simple chart that compares actual and
planned performance
The Gantt chart was the first simple visual
device to maintain production control
The chart indicates the progress of production
in terms of time rather than quantity
Along the horizontal axis of the chart, time,
work scheduled and work completed are shown
The vertical axis identifies the individuals and
machines assigned to these work schedules
The Gantt chart is still used today by many
organizations
Limitations of scientific management
scientific management revolve round
problems at the operational (production)
level and do not focus on the management
of an organization from a manager’s point
of view
People were “rational” and were motivated
primarily by the desire for material
(economic and physical needs) gain
whereas people were also interested in
other needs (social needs)
Scientific management theorists also
ignored the human desire for job
satisfaction
Slide 4
 Administrative Theory
Scientific management was developed
basically for getting more from workers
whereas another classical theory – the
administrative management theory –
focused on principles that could be used
by managers to coordinate the internal
activities of organizations
The most prominent of the administrative
theorists was Henri Fayol
 Henri Fayol:(1841-1925)
French industrialist Henri Fayol, a prominent European
management theorist, developed a theory of
management.
Fayol believed that satisfactory results were inevitable:
with scientific forecasting
Proper methods of management
He was not known in America till his most important
work, General and Industrial Management, was
translated into English in1949
According to Fayol, the business operations of an
organization could be divided into six activities
Technical
Commercial
Financial
Security
Accounting
Managerial
Henri Fayol’s Managerial Activity
Fayol focused on the last activity:
Managerial Activity
Within this, he identified five major
functions:
– Planning
– Organizing
– Commanding
– Coordinating
– Controlling
Fourteen Principles of Management
1. Division of work:
– Work specialization results in improving efficiency of
operations The concept of division of work can be
applied to both managerial and technical functions
2. Authority and responsibility:
– Authority is defined as “the right to give orders and
the power to exact obedience.”
– Authority can be:
Formal-derived from one’s official position
Personal-derived from factors like:
– Intelligence
– experience
Fourteen Principles of Management (contd)
3. Discipline:
– Discipline is vital for running an organization
smoothly
– It involves:
Obedience to authority
Adherence to rules
Respect for superiors
Dedication to one’s job
4. Unity of command:
– Each employee should receive orders or
instructions from one superior only
Fourteen Principles of Management (contd)
5. Unity of direction:
– Activities should be organized in such a way
that they all come under one plan and are
supervised by only one person
6. Subordination of the individual interest
to the general interest:
– Individual interests should not take (over
take) precedence over the goals of the
organization
Fourteen Principles of Management (contd)

7. Remuneration:
– The compensation paid to employee should be fair
(reasonable) and based on factors like:
Business condition
Cost of living
Productivity of employees and the ability of the firm to pay
8. Centralization:
– Depending on the situation, an organization should
adopt a centralized or decentralized approach to
make optimum use of its personnel
Fourteen Principles of Management (contd)
9. Scalar Chain:
– This refers to the chain of authority that extends
from the top to the bottom of an organization
– The scalar chain defines the communication path in
an organization
10. Order:
– This refers to both material and social order in
organizations
Material order indicates that everything is kept in the right
place to facilitate the smooth coordination of work activities
Social order implies that the right person is placed in the
right job
Fourteen Principles of Management (contd)
11. Equity:
– All employees should be treated fairly
– A manager should treat all employees in the
same manner without prejudice
12. Stability of tenure of personnel:
– A high labor turnover should be prevented
and managers should motivate their
employees to do a better job
Fourteen Principles of Management (contd)
13. Initiative:
– Employees should be encouraged to
give suggestions and develop new and
better work practice
14. Espirit de corps:
– This means “a sense of union.”
– Management must inculcate a team
spirit in its employees
Slide 4
 Bureaucratic Management
Bureaucratic management, one of the
schools of classical management,
emphasizes (importance) the need for
organizations to function on a rational
(showing clear thoughts or reasons) basis
Weber (1864-1920):
A contemporary (lived in the same
period) of Fayol, was one of the major
contributors to this school of thought
 Weber’s observation

He observed that nepotism (hiring of relatives

regardless of their competence) was prevalent
in most organization.
Weber felt that nepotism was grossly unjust
and hindered the progress of individuals.
Therefore, he identified the characteristics of an
ideal bureaucracy to show how large
organizations should be run
 What is bureaucracy?
The term “bureaucracy” (derived from the German buro.
meaning office) referred to organizations that operated
on a rational basis
According to Weber, “a bureaucracy is a highly
structured, formalized, and impersonal organization.”
In other words, it is a formal organizations structure
with a set of rules and regulations
These characteristics would exist to a greater degree in
“ideal” organizations and to a lesser degree in other, less
perfect organization
These type of organization help bring in clarity and
remove ineffectiveness
Limitations of Classical approach
Classical theorists ignored important aspect of
organizational behavior (action)
They did not deal with the problem of:
Leadership
Motivation
Power or informal relations
Max Weber’s concept of bureaucracy is not as popular
today as it was when it was first proposed
The principal characteristics of bureaucracy destroy
individual creativity and the flexibility to respond to
complex changes in the global environment
Some of the managerial principles (order, equity)
propounded by the classical theorists were not
universally applicable to today’s complex organizations
Slide 4
 Behavioral Approach
The behavioral school of management
emphasized what the classical theorists ignored
–the human element
While classical theorists viewed the
organization from a production point of view,
the behavioral theorists viewed it from the
individuals point of view
The behavioral approach to management
emphasized
Individual attitude
Individual behaviors
Group processes
This approach recognizes the significance of
behavioral processes in the workplace Slide 5
 Mary Parker Follet:(1868-1933)
Focusing on Group Influences:
Though Follet worked during the scientific
management era, she understood the
significance of the human element in
organizations
She argued that organizational participants
were influenced by the group within which they
worked
She suggested that organizations function on
the principle of “power with” rather than
“power over”
What is the power she is talking about?
 The Power
Power according to Follet, was the ability
to influence and bring about change
She argued that power should not be
based on hierarchy, instead, it should be
based on cooperation and should involve
both superiors and subordinates
In other words, she advocated (publicly
supported):
power sharing
The concept of integration (finding a solution
acceptable to all group members)
Slide 5
 Elton Mayo:(1880-1949)
Focusing on Human Relations:
Elton Mayo The “Father of the Human Relations
Approach,” led the team which conducted a study at:
– Western Electric’s Hawthorne Plant (1927)
Objective: To evaluate the attitude and psychological reaction of
workers in on-the-job situation
Participants: The researchers and scholars associated with the
Hawthorne experiments were:
– Elton Mayo
– Fritz Roethlisberger
– T N Whitehead
– William Dickson
The study was started in 1924 by Western Electric’s industrial
engineers and was extended through the early 1930s
The experiments were conducted in four phases:
– Illumination experiments (1924-1927)
– Relay assembly test room experiments (1927-1923)
– Interview phase (1928-1930)
– Bank wiring observation room experiments (1931-1932)
Illumination experiments (1924-1927)
These experiments involved manipulating
the illumination for one group of workers
(called the experimental or test group)
and comparing their subsequent
productivity with the productivity of
another group (the control group) for
whom the illumination was not changed
The results of the experiments were
ambiguous (more than one information)
Illumination experiments (contd)
For the test group:
– The performance improved as the
– However, the performance of the light
Test group rose steadily even when
The illumination for the group was made dim
– Compounding the mystery, the control group’s
productivity also tended to rise
– The researchers concluded that group productivity
was not directly related to illumination intensity but
something else
– At this point Elton Mayo was called to participate in
conducting the next phase of the experiments
Relay assembly test room experiments
(1927-1933)
In this phase, researchers were
concerned about working conditions like:
Working hours
Frequency
Duration of rest periods
– The researchers selected six women who
were informed about the experiment were
asked to assemble a small device called an
electric relay
Relay assembly test room experiments
In the course of the experiments the
following were altered:
Wages increased
Rest period varied
Duration of work was shortened
Privileged to leave the workstation without
permission
Received special attention from the researchers
Generally, productivity increased
regardless of how the factors under
consideration were MANIPULATED
 “Hawthorn effect”

The Harvard University group ultimately

concluded:
Better treatment of employees made them more productive
One of the findings of the study was the identification of the
concepts which came to be described as the “Hawthorn
effect”
The “Hawthorn effect” is defined as the
possibility that individuals picked up to
participate in a study may show higher
productivity ONLY because of the added
ATTENTION they receive from the researchers
rather than any other factor listed in the study
 Interview phase (1928-1930)
– During the course of the experiments, about
21, 000 people were interviewed over a three
year period to explore the reasons for human
behavior at work
– The following points were observed:
The social demands of the workers are influenced
by social experiences in groups both inside and
outside the workplace
The social organization of the company represents
a system of values from which the worker derive
satisfaction or dissatisfaction according to his
perception of his social status and the expected
social rewards
 Observations (contd)
– The position or status of the worker in the
company is a reference from which the
worker assigns meaning and value to the
events, objects, and features of his
environment, such as hours of work, wages
etc.
– Objects, persons and events carry social
meaning. Their relation to employee
satisfaction or dissatisfaction is purely based
on the employee’s personal situation and how
he perceives them
 Observations (contd)
The personal situation of the worker consists
of:
– A personal reference:
Pertains to a person’s:
– Sentiments
– Desires
– Interests
– A social reference:
Pertains to a person’s:
– Past interpersonal relationships
– Present interpersonal relationships

A complaint is not necessarily an objective

recital of facts, it can also be a symptom of
personal disturbance, the causes of which may
be deep-seated
Bank wiring observation room experiments (1931-1932)
These experiments were undertaken by
researchers to test some of the ideas they had
gathered during the interviews
The fourteen participants in the experiment were
asked to assemble telephone wiring to produce
terminal banks
This time no changes were made in the physical
working conditions
Workers were paid on the basis of an incentive
pay plan, under which their pay increased as their
output increased
Researchers observed that output stayed at a
fairly constant level, which was contrary to their
expectations
Their analysis showed that the group encouraged
neither too much nor too little work
Contributions/Criticisms of Hawthorne experiments
Contributions:
– The Hawthorne experiments, which laid the
foundation for the Human Relations Movement,
made significant contribution to the evolution of
management theory
Criticism:
– The have been criticized on the following:
The procedures, analysis of findings, and the
conclusions reached were found to be
questionable (little evidence)
The relationship made between the satisfaction or
happiness of workers and their productivity was
too simplistic
These studies failed to focus attention on the
attitudes of employees at the workplace
Slide 5
 Abraham Maslow:(1908-1970)

Focusing on Human Needs:

– A Brandeis University psychologist, theorized
that people were motivated by a hierarchy of
needs
– His theory rested on three assumptions:
First – All of us have needs which are never
completely fulfilled
Second – Through our actions we try to fulfill our
unsatisfied needs
 Abraham Maslow (contd)
Third – Human needs occur in the following
hierarchical manner:
– Physiological needs (Basics need- food, shelter &
clothing
– Safety or security needs
– Social or belongingness needs
– Esteem or status needs
– Self-actualization needs
According to Maslow, once needs at a
specific level have been satisfied, they no
longer act as motivators of behavior
Then the individual strives to fulfill needs
at the next level Slide 5
 Douglas McGregor:(1906-1964)
Challenging Traditional (old) Assumption about
employees
Douglas McGregor developed two assumptions
about human behavior:
– Theory X:
Presents an essentially negative view of people
– Theory Y:
Is more positive and presumes that workers can be creative
and innovative
Are willing to take responsibility
Can exercise self-control and can enjoy their work
They have higher level needs which have not been satisfied
by the job
Some more ideas about Theory X & Y
According to McGregor, these two theories reflect the
two extreme sets of belief that different managers have
about their workers
Theory X, managers assume that:
Workers are lazy
Have little ambition
Dislike work
Want to avoid responsibility
Need to be closely directed to make them work effectively
Like Maslow’s theory, McGregor’s Theory X & Theory Y
influenced many practicing managers
These theories helped managers develop new ways of
managing the workers

Slide 5
 Chris Argyris: (1923 -
Matching Human & Organizational
Development
A Yale University professor in psychology
made significant contributions to the
behavioral school of management
thoughts
The major contributions of this behavioral
scientist are:
The maturity-immaturity theory
Integration of individual and organizational goal
Model I and Model II organization analysis
 The maturity-immaturity theory
Argyris points out the inherent (in-built)
conflict (opposing each other) between
the healthy individual and the rigid
structure of the formal organization
He believes that people progress from a
stage of immaturity and dependence to a
state of maturity and independence
Many organizations tend to keep their
employees in a dependence state,
thereby blocking further progress
resulting in failure and frustration
 How to correct it?
Integration of individual and organizational
goals;
Argyris argues, that conflict can be corrected by
techniques such as:
– Job enlargement
– Job loading
This will:
– Increase the work-related responsibilities of the
individual
– Allow him to participate in the decision-making
process
Model I and Model II organization analysis
Argyris classifies organizations on the basis of
the employees’ set of values as :
– Model I:
The employees here are manipulative and pitted against
each other
They are not willing to take risks
– Model II:
Workers are open to learning and less manipulative
Their access to information gives them freedom to make
informed choices
This intern increases their willingness to take risks
Hence, according to Argyris, managers should
strive to create a Model II environment Slide 5
 Quantitative Approach
The quantitative management perspective
emerged during World War II between US Army
and UK Navy (Royal Navy) brought together
managers, government officials and scientists
to help it deploy its resources more efficiently
and effectively
These war experts used some of the
mathematical approaches to management
devised earlier by Taylor and Gantt to solve the
logistical (supply of material/ positioning of
ships/men/arms and ammunitions etc.)
problems faced by the army
 Quantitative Approach (contd)
This approach focuses on achieving
organizational effectiveness through the
application of:
– Mathematical concepts
– Statistics concepts
The three main branches of the
quantitative approach are:
– Management science
– Operations management
– Management information systems Slide 6
 Management Science
The management science approach stresses the use of:
Mathematical models:
– Waiting line theory or queuing theory
– Linear programming
– The decision theory
– The situation theory
– Time series analysis etc.
Statistical models for decision-making
Here, we visualize that management as a logical entity,
the action of which can be expressed in terms of:
Measurement data
Mathematical symbols
Relationship among them
Another name commonly used for management science
is operations research Slide 6
 Operations Management
Operations management is an applied form of
management science
It deals with the effective management of the
production process and the timely delivery of
an organization’s products and services
Operations management is concerned with:
– Inventory management
– Work scheduling
– Production planning
– Facilities location and design
– Quality assurance
 Operations Management (contd)
The tools used by operations managers
are:
– Forecasting:
Example: Assessing before hand the next years
sale
– Inventory analysis
– Material requirement planning systems
– Networking models
– Statistical quality control methods
– Project planning
– Control techniques Slide 6
Management Information Systems
Management information system
focus on designing and implementing
computer based information systems
for business organizations
In simple terms, the MIS converts
raw data into information and
provides the needed information to
each manager at the right time, in
the needed form

Slide 6
Modern Approaches to management
Two of these approaches are:
Systems Theory: What is a system? (contd)

According to this theory, an organizational system

has four major components
– Inputs: Money, Material, Men, Machines and Information
are required to produce goods and services
– Transformation process : Managerial and technical
abilities are used to convert
inputs into outputs
– Output : Products, Services, Profits and other results
produced by the organization
– Feedback : Refers to information about the outcomes
and the position of the organization relative to the
environment it operates in
Slide 7
 Systems Theory (contd)
Two basics types of systems are:
– Open systems:
A system that interacts with its environment is
regarded as an open system
What is an environment?
– Society
– Government
– Creditors and Suppliers
– Customers
– Employees
– Shareholders
– Closed systems:
A system that does not interacts with its
environment is regarded as a closed system Slide 7
 Contingency Theory:
This is also known as the situational theory Management Science Scientific
Management (1856-1919)

According to this theory there is no one best way to

manage all situations
The contingency approach was developed by :
Managers
Consultants
Researchers
– The above (Rudy Giuliani -the new York city mayor) make
management decisions or adopt a particular management style
only after carefully considering all situational factors
Which is the best way?
– The response “It depends” holds good for several management
situations
Example: September 9/11 (2001) attack on new York city
Slide 7
Emerging Approaches in Management thought
Theory Z:
– This theory combines the positive aspect of both
American and Japanese management styles
– This approach involves
providing:
– Job security to employees to ensure their loyalty
– Long-term association with the company
Job rotation of employees to develop their cross-functional
skills
– This approach wants their employees to get involved
in decision-making process, information control and
performance measurement (why?)
– Here,
The organization shows concern for its employees’ well-
being
Lays important on their training and development
 Emerging Approaches in Management
thought (contd)
Quality Management:
– Is a management approach that directs the
efforts of management towards bringing
about continuous improvement in product
and service quality to achieve higher levels of
customer satisfaction and build customer
loyalty
– To be successful and effective, this approach
needs to be integrated with an organization's
strategy
 Summary
Stages of evolution of management
thought:
– Pre-classical approach
– Classical Approach
– Behavioral Approach
– Quantitative Approach
– Modern Approaches