Classical Management Theory

Context of Emergence

• Industrial Revolution: Late 1700s - Late 1800s
  • Transition from farms to factories
  • Growth of large factories
  • Key ingredients:
    • Power: Steam and hydropower
    • Machinery: Innovations like the cotton gin
    • Transportation: Railroads, steamboats, improved roads
• Issues:
  • New, large groups of people working together
  • Workers alongside machinery
  • Rapid increase in industrial pace
  • Need for efficient management and organization

Main Contributors to Classical Management Theory

Max Weber

• Known for bureaucracy
  • Organizations as extensions of government/legal systems
  • Legal, rational organization
  • Authority tied to position, not individuals
  • Clear rules and standardized guidelines
  • Focus on hiring the best people and avoiding favoritism

Frederick Taylor

• Developed scientific management
  • Micro-level focus on work tasks
  • Time and motion studies to find "one right way" to perform tasks
  • Standardization of tasks to increase efficiency
  • Example: Bricklaying efficiency increased by 300%

Henri Fayol

• Introduced administrative science
  • Management-focused approach
  • Systematic training for managers
  • Key management activities:
    • Planning: Look ahead and chart a course
    • Organization: Arrange people efficiently
    • Command: Oversee and lead the process
    • Coordination: Harmonize activities across departments
    • Control: Ensure compliance in various areas

Common Elements in Classical Management Theory

• Clear hierarchy and chain of command
• Division of labor
• Standardized work approach
• Centralization of authority
• Separation of personal and organizational life
• Hiring based on qualifications and performance
• Fair compensation, including profit sharing

Relevance Today

• Still influential in manufacturing, warehouses, delivery services, food service, and farming
• Influences many modern companies, directly or indirectly
• New approaches like systems theory and human relations often react against classical management
• Less applicable to knowledge-based companies (e.g., Google, Facebook) that do not manufacture tangible goods

Conclusion

• Classical Management Theory is foundational to organizational studies
• Its principles continue to be relevant and influential in various industries