The Classical Management School
The twentieth century witnessed tremendous management theory ferment and activity. Efforts were taking place for the development of a comprehensive management theory. Traditional or classical management school of theory is a result of such efforts. Henri Fayol (1841-1925) is widely acclaimed as the founder of the Classical management school.
Classical Management Theory concentrates on efficiency. Classical school has three distinct branches, viz scientific management, bureaucratic management, and administrative management. It envisages a pyramid hierarchical structure, autocratic management, clear chain of command and short spans of control.
Frederick Winslow Taylor (1856-1915)is known as the "father of scientific management". Taylor began work at the age of 18 as a machinist apprentice to a pattern-maker. He later joined the Midvale Steel Company as a laborer and became chief engineer in eight years. During his period at the steel mill Taylor performed comprehensive experiments on worker productivity and tested what he called the "task system," later developed into the Taylor System and eventually progressed into scientific management.
Scientific management theory analyzes and synthesizes workflow processes and improving labor productivity. Scientific management is also called Taylorism, the Taylor system, or the Classical Perspective. The core ideas of the theory were developed by Frederick Winslow Taylor in the 1880s and 1890s, and were first published in his monographs, Shop Management (1905) and The Principles of Scientific Management (1911). Taylor believed that decisions based upon tradition and rules of thumb should be replaced by precise procedures developed after careful study of an individual at work.
Taylor's experiments included determining the best way of performing each work operation, the time it required, materials needed and the work sequence. He wanted to establish a clear division of labor between management and employees.
Following are the four basic principles of Scientific management theory:
- Study the ways jobs are performed now and determine new ways to do them.
- Codify the new methods into rules.
- Select workers whose skills match the rules.
- Establish fair levels of performance and pay incentive for higher performance.
The scientific management is a 'manager centric' approach. The most fundamental aspect of scientific management is that the manager is primarily responsible for increasing an organization's productivity. Scientific management principles are to be applied by managers in a very specific fashion.
The shortcomings of the Scientific Theory had triggered the quest for more workable solutions and resulted in the formulation of bureaucratic management, and administrative management theories. The scientific method was also got refined further during the course of time.
Max Weber (1864-1920)is one of the strong advocates of bureaucracy. According to Weber the major characteristics of bureaucracy are:
A well defined hierarchy
All positions within a bureaucracy are structured in a way permitting the higher positions to supervise and control the lower positions. This provides a clear chain of command facilitating control and order throughout the organization.
Division of labor and specialization
All responsibilities in an organization are streamlined in a way that each employee will have the necessary expertise to master a particular task. This necessitates granting each employee the requisite authority to complete all such tasks.
Rules and regulations
All organizational activities are streamlined in a way that standard operating procedures are developed to provide certainty and facilitate coordination.
Impersonal relationships between managers and employees
Weber believed that managers should maintain an impersonal relationship with the employees so that the managers will be free to take rational decisions rather than one influenced by favoritism and personal prejudice. This organizational atmosphere would also facilitate rational evaluation of employee outcomes where personal prejudices shall not interfere.
Competence should be the basis for all decisions made in hiring, job assignments, and promotions. This would encourage ability and merit as the most important characteristics of a bureaucratic organization.
Weber felt it is absolutely essential for a bureaucracy to maintain complete files regarding all its activities. This ncessitates an accurate organizational "memory" where accurate and complete documents will be available concerning all bureaucratic actions and decisions.
Henri Fayol (1841-1925) is the prominent advocate of administrative management. He spent his entire working career with a mining company, where he rose from an apprentice to General Manager.
As a result of his long management career, Fayol developed fourteen management principles:
- Division of Work. Division of work, specialization, produces more and better work with the same effort. It focuses effort while maximizing employee efforts. It is applicable to all work including technical applications. There are limitations to specialization which are determined by its application.
- Authority and responsibility. Authority is the right to give orders and the power to exact obedience. Distinction must be made between a manager's official authority deriving from office and personal authority created through individual personality, intelligence and experience. Authority creates responsibility.
- Discipline. Obedience and respect between a firm and its employees based on clear and fair agreements is absolutely essential to the functioning of any organization. Good discipline requires managers to apply sanctions whenever violations become apparent.
- Unity of command. An employee should receive orders from only one superior. Employees cannot adapt to dual command.
- Unity of direction. Organizational activities must have one central authority and one plan of action.
- Subordination of Individual Interest to General Interest. The interests of one employee or group of employees are subordinate to the interests and goals of the organization and cannot prevail over it.
- Remuneration of Personnel. Salaries are the price of services rendered by employees. It should be fair and provide satisfaction both to the employee and employer. The rate of remuneration is dependent on the value of the services rendered as determined by the employment market.
- Centralization. The optimum degree of centralization varies according to the dynamics of each organization. The objective of centralization is the best utilization of personnel.
- Scalar chain. A chain of authority exists from the highest organizational authority to the lowest ranks. While needless departure from the chain of command should be discouraged, using the "gang plank" principle of direct communication between employees can be extremely expeditious and increase the effectiveness of organizational communication.
- Order. Organizational order for materials and personnel is essential. The right materials and the right employees are necessary for each organizational function and activity.
- Equity. In organizations equity is a combination of kindliness and justice. The desire for equity and equality of treatment are aspirations to be taken into account in dealing with employees.
- Stability of Tenure of Personnel. In order to attain the maximum productivity of personnel, it is essential to maintain a stable work force. Management insecurity produces undesirable consequences. Generally the managerial personnel of prosperous concerns is stable, that of unsuccessful ones is unstable.
- Initiative. Thinking out a plan and ensuring its success is an extremely strong motivator. At all levels of the organizational ladder zeal and energy on t he part of employees are augmented by initiative.
- Esprit de Corps. Teamwork is fundamentally important to an organization. Creating work teams and using extensive face-to-face verbal communication encourages this.