Transcript Seminar One

The History of Management
Thought
MGT 336, Management History and
Theory
Michael Bejtlich, Instructor
Based on The History of Management Thought, 5th edition, 2005 by Daniel A. Wren
Part One:
Early Management Thought
Chapter One
A Prologue to the Past
Purpose of this Study
To trace the significant periods in the
evolution of management thought from its
earliest days to the present.
What can we learn from reviewing
the history of management?
• It helps us to integrate our knowledge of leadership.
• It provides a perspective on the past to apply to the
present.
• History helps us develop alternatives because our
knowledge has been broadened and deepened by an
understanding of the past.
• “What happened?” is a starting point for developing
new ideas without “reinventing the wheel.”
A Cultural Framework
• The economic facet – relationship of people to
resources
• The social facet – relationship of people to other
people
• The political facet – relation of the individual to the
state
• The technological facet – related to the art and
applied science of making tools and equip
People, Management, and
Organizations
• The human being is then fundamental unit of
analysis for the study of mankind, management, and
organizations.
• Human basic needs and social needs led to the
formation of family and groups, a primitive hierarchy
of organization.
• People found advantages in participating and
cooperating with others to achieve goals.
Figure 1-1
Early Organizations
• First, there has to be a goal.
• Second, people must be attracted to the
purpose in order to participate.
• Third, organizational members need
resources.
• Fourth, activities must be structured.
• Fifth, results were better achieved through
the activity of management.
Definition
Management is the art of
arranging physical and human
resources toward purposeful
ends.
Chapter Two
Management before
Industrialization
Management in
Early Civilizations
• Hammurabi – Code of Law
• Sun Tzu – Planning and Strategy
• Confucius – Personnel selection by merit, early
bureaucracy, and division of labor
• The Egyptians – massive projects, Rule of 10
• Kautilya – Public administration, trait approach for
selecting leaders, use of staff for advising, and job
descriptions
• Joseph – best known for vizier - from which the
word supervisor is derived
Management in Early
Civilizations
• Moses – organization, span of control, delegation, and
the exception principle
• Socrates – transferability of managerial skills
• Aristotle – specialization of labor, departmentation,
delegation, synergy, leadership and scientific method
• Xenophon – advantages of specializing labor
• Rome – span of control as well as a model for later
civilizations
The Catholic Church
• Oldest living
organization
• Conflict between
centralized and
decentralized authority
still exists today –
characterized as the need
for unanimity of purpose
yet discretion for local
problems and conditions.
Courtesy of Pics4Learning. http://pics.tech4learning.com
Feudalism and the Middle
Ages
• Caused by the development of free people as tenant
farmers, growth of large estates, political disorder,
economic, social, and political chaos.
• Tied people to the land, fixed rigid class systems,
established landed aristocracy, stopped education,
caused poverty and ignorance, and stifled human
progress until the Age of reformation.
Commerce
• Marco Polo travels to the Far East – sees the
“Rule of Ten” in the Tatar tribes.
• Craft Guilds – makers of goods; regulated
job access.
• Merchant Guilds – buyer & sellers of goods.
• Pay based on performance – did not get paid
until work was returned to the merchant.
Growing Trade
Fra Luca Pacioli
• Luca Pacioli’s system
of double-entry
accounting – the first
management
information system
(cash & inventory
position and a check
on cash flow)
developed in 15th
century.
Early Ethical Considerations
• “Just Price” = market price; advocated by Saint Thomas
Aquinas in 13th century.
• Trade rules (Code of Ethical Conduct) proposed by
Friar Johannes Nider in 1468:
• Goods should be “lawful, honorable, and useful.
• Price should be just.
• Seller should beware.
• Speculation was a sin.
Protestant Ethic
• Max Weber advocated the belief
that Protestants held different
attitudes toward work. This
spirit of capitalism led to the
Industrial Revolution:
• Individual responsibility and
self-control
• Work as a means of salvation
• Do not waste time or money
• Do your best in your “calling”
• Do not consume beyond your
basic need
Max Weber
Criticism of Weber
• R.H. Tawney’s opinions:
• Capitalism existed before the Protestant Ethic.
• Capitalism was the cause and justification of
the Protestant Ethic, not the effect.
• Economic motivation pressured to change
Church dogma to sanction economic efforts.
Modern Support for Weber
• David C. McClelland
• Support for Weber in his observations of the
influence of religion on human attitudes toward
work and self-reliance.
• He found that children of Protestants had higher
n achievement than children of Catholics, and
children of Jews had still higher n achievement.
• McClelland said the need for achievement is not
restricted to Protestants and there are wide variations
among individuals which are influenced by the
lessons they learn early in life about work, risktaking, and self-reliance.
The Liberty Ethic
• Differing ideas of the
assumptions made about the
nature of people guiding the
choice of leadership style
Nicolo Machiavelli
• Nicolo Machiavelli – The Prince
• “…all men are bad and ever
ready to display their vicious
nature…” (1513)
• Thomas Hobbes’s – Leviathan
• Some great power must exist
to bring order from chaos.
(1651)
The Liberty Ethic
• John Locke’s
Concerning Civil
Government (1690)
John Locke
Wren,
History of Management Thought
• People have natural rights
to property, contracts, a
redress of grievances, and
to freely choose those
who are to govern
• Natural rights are to be
protected through civil
law in order to preserve
more perfectly their life,
liberty, and property
• His work set the stage for
the Declaration of
Independence
The Market Ethic
• Adam Smith – Wealth of
Nations (1776)
• Market forces were far
more efficient in
allocating resources and
more “just” in rewarding
individuals who produced
the wealth than
Mercantilism
(government regulated the
economy).
Adam Smith
The Market Ethic
• Specialization of labor
• Increase performance
• Loss of mental
exertion – “…dexterity
at his own particular
trade seems…to be
acquired at the expense
of his intellectual,
social, and martial
virtues”
Summary
• Early management thought was dominated
by cultural values that were antibusiness
• Three forces, or ethics, interacted to provide
for a new age of industrialization
• Protestant Ethic
• Liberty Ethic
• Market Ethic