history of management essay

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2 The History of Management

Learning Objectives

The purpose of this chapter is to:

• 1) Give you an overview of the evolution of management thought and theory.
• 2) Provide an understanding of management in the context of the modern-day world in which we reside.

The History of Management

The concept of management has been around for thousands of years. According to Pindur, Rogers, and Kim (1995), elemental approaches to management go back at least 3000 years before the birth of Christ, a time in which records of business dealings were first recorded by Middle Eastern priests. Socrates, around 400 BC, stated that management was a competency distinctly separate from possessing technical skills and knowledge (Higgins, 1991). The Romans, famous for their legions of warriors led by Centurions, provided accountability through the hierarchy of authority. The Roman Catholic Church was organized along the lines of specific territories, a chain of command, and job descriptions. During the Middle Ages, a 1,000 year period roughly from 476 AD through 1450 AD, guilds, a collection of artisans and merchants provided goods, made by hand, ranging from bread to armor and swords for the Crusades. A hierarchy of control and power, similar to that of the Catholic Church, existed in which authority rested with the masters and trickled down to the journeymen and apprentices. These craftsmen were, in essence, small businesses producing products with varying degrees of quality, low rates of productivity, and little need for managerial control beyond that of the owner or master artisan.

The Industrial Revolution, a time from the late 1700s through the 1800s, was a period of great upheaval and massive change in the way people lived and worked. Before this time, most people made their living farming or working and resided in rural communities. With the invention of the steam engine, numerous innovations occurred, including the automated movement of coal from underground mines, powering factories that now mass-produced goods previously made by hand, and railroad locomotives that could move products and materials across nations in a timely and efficient manner. Factories needed workers who, in turn, required direction and organization. As these facilities became more substantial and productive, the need for managing and coordination became an essential factor. Think of Henry Ford, the man who developed a moving assembly line to produce his automobiles. In the early 1900s, cars were put together by craftsmen who would modify components to fit their product. With the advent of standardized parts in 1908, followed by Ford’s revolutionary assembly line introduced in 1913, the time required to build a Model T fell from days to just a few hours (Klaess, 2020). From a managerial standpoint, skilled craftsmen were no longer necessary to build automobiles. The use of lower-cost labor and the increased production yielded by moving production lines called for the need to guide and manage these massive operations (Wilson, 2015). To take advantage of new technologies, a different approach to organizational structure and management was required.

The Scientific Era – Measuring Human Capital

With the emergence of new technologies came demands for increased productivity and efficiency. The desire to understand how to best conduct business centered on the idea of work processes. That is, managers wanted to study how the work was performed and the impact on productivity. The idea was to optimize the way the work was done. One of the chief architects of measuring human output was Frederick Taylor. Taylor felt that increasing efficiency and reducing costs were the primary objectives of management. Taylor’s theories centered on a formula that calculated the number of units produced in a specific time frame (DiFranceso and Berman, 2000). Taylor conducted time studies to determine how many units could be produced by a worker in so many minutes. He used a stopwatch, weight measurement scale, and tape measure to compute how far materials moved and how many steps workers undertook in the completion of their tasks (Wren and Bedeian, 2009). Examine the image below – one can imagine Frederick Taylor standing nearby, measuring just how many steps were required by each worker to hoist a sheet of metal from the pile, walk it to the machine, perform the task, and repeat, countless times a day.   Beyond Taylor, other management theorists including Frank and Lilian Gilbreth, Harrington Emerson, and others expanded the concept of management reasoning with the goal of efficiency and consistency, all in the name of optimizing output . It made little difference whether the organization manufactured automobiles, mined coal, or made steel, the most efficient use of labor to maximize productivity was the goal.

The necessity to manage not just worker output but to link the entire organization toward a common objective began to emerge. Management, out of necessity, had to organize multiple complex processes for increasingly large industries. Henri Fayol, a Frenchman, is credited with developing the management concepts of planning, organizing, coordination, command, and control (Fayol, 1949), which were the precursors of today’s four basic management principles of planning, organizing, leading, and controlling.

Employees and the Organization

With the increased demand for production brought about by scientific measurement, conflict between labor and management was inevitable. The personnel department, forerunner of today’s human resources department, emerged as a method to slow down the demand for unions, initiate training programs to reduce employee turnover, and to acknowledge workers’ needs beyond the factory floor. The idea that to increase productivity, management should factor the needs of their employees by developing work that was interesting and rewarding burst on the scene (Nixon, 2003) and began to be part of management thinking. Numerous management theorists were starting to consider the human factor. Two giants credited with moving management thought in the direction of understanding worker needs were Douglas McGregor and Frederick Herzberg. McGregor’s Theory X factor was management’s assumption that workers disliked work, were lazy, lacked self-motivation, and therefore had to be persuaded by threats, punishment, or intimidation to exert the appropriate effort. His Theory Y factor was the opposite. McGregor felt that it was management’s job to develop work that gave the employees a feeling of self-actualization and worth. He argued that with more enlightened management practices, including providing clear goals to the employees and giving them the freedom to achieve those goals, the organization’s objectives and those of the employees could simultaneously be achieved (Koplelman, Prottas, & Davis, 2008).

Frederick Herzberg added considerably to management thinking on employee behavior with his theory of worker motivation. Herzberg contended that most management driven motivational efforts, including increased wages, better benefits, and more vacation time, ultimately failed because while they may reduce certain factors of job dissatisfaction (the things workers disliked about their jobs), they did not increase job satisfaction. Herzberg felt that these were two distinctly different management problems. Job satisfaction flowed from a sense of achievement, the work itself, a feeling of accomplishment, a chance for growth, and additional responsibility (Herzberg, 1968). One enduring outcome of Herzberg’s work was the idea that management could have a positive influence on employee job satisfaction, which, in turn, helped to achieve the organization’s goals and objectives.

The concept behind McGregor, Herzberg, and a host of other management theorists was to achieve managerial effectiveness by utilizing people more effectively. Previous management theories regarding employee motivation (thought to be directly correlated to increased productivity) emphasized control, specialized jobs, and gave little thought to employees’ intrinsic needs. Insights that considered the human factor by utilizing theories from psychology now became part of management thinking. Organizational changes suggested by management thinkers who saw a direct connection between improved work design, self-actualization, and challenging work began to take hold in more enlightened management theory.

The Modern Era

Koontz and O’Donnell (1955) defined management as “the function of getting things done through others (p. 3). One commanding figure stood above all others and is considered the father of modern management (Edersheim, (2007). That individual was Peter Drucker. Drucker, an author, educator, and management consultant is widely credited with developing the concept of Managing By Objective or MBO (Wren & Bedeian, 2009). Management by Objective is the process of defining specific objectives necessary to achieve the organization’s goals. The beauty of the MBO concept was that it provided employees a clear view of their organization’s objectives and defined their individual responsibilities. For example, let’s examine a company’s sales department. One of the firm’s organizational goals might be to grow sales (sometimes referred to as revenue) by 5% the next fiscal year. The first step, in consultation with the appropriate people in the sales department, would be to determine if that 5% goal is realistic and attainable. If so, the 5% sales growth objective is shared with the entire sales department and individuals are assigned specific targets. Let’s assume this is a regional firm that has seven sales representatives. Each sales rep is charged with a specific goal that, when combined with their colleagues, rolls up to the 5% sales increase. The role of management is now to support, monitor, and evaluate performance. Should a problem arise, it is management’s responsibility to take corrective action. If the 5% sales objective is met or exceeded, rewards can be shared. This MBO cycle applies to every department within an organization, large or small, and never-ending.

The MBO Process

Drucker’s contributions to modern management thinking went far beyond the MBO concept. Throughout his long life, Drucker argued that the singular role of business was to create a customer and that marketing and innovation were its two essential functions. Consider the Apple iPhone. From that single innovation came thousands of jobs in manufacturing plants, iPhone sales in stores around the globe, and profits returned to Apple, enabling them to continue the innovation process. Another lasting Drucker observation was that too many businesses failed to ask the question “what business are we in?” (Drucker, 2008, p. 103). On more than one occasion, a company has faltered, even gone out of business, after failing to recognize that their industry was changing or trying to expand into new markets beyond their core competency. Consider the fate of Blockbuster, Kodak, Blackberry, or Yahoo.

Management theories continued to evolve with additional concepts being put forth by other innovative thinkers. Henry Mintzberg is remembered for blowing holes in the idea that managers were iconic individuals lounging in their offices, sitting back and contemplating big-picture ideas. Mintzberg observed that management was hard work. Managers were on the move attending meetings, managing crises, and interacting with internal and external contacts. Further, depending on the exact nature of their role, managers fulfilled multiple duties including that of spokesperson, leader, resource allocator, and negotiator (Mintzberg, 1973). In the 1970s, Tom Peters and Robert Waterman traveled the globe exploring the current best management practices of the time. Their book, In Search of Excellence, spelled out what worked in terms of managing organizations. Perhaps the most relevant finding was their assertion that culture counts. They found that the best managed companies had a culture that promoted transparency, openly shared information, and effectively managed communication up and down the organizational hierarchy (Allison, 2014). The well managed companies Peterson and Waterman found were built in large part on the earlier managerial ideas of McGregor and Herzberg. Top-notch organizations succeeded by providing meaningful work and positive affirmation of their employees’ worth.

Others made lasting contributions to modern management thinking. Steven Covey’s The Seven Habits of Highly Successful People , Peter Senge’s The Fifth Discipline , and Jim Collins and Jerry Porras’s Built to Last are among a pantheon of bestselling books on management principles. Among the iconic thinkers of this era was Michael Porter. Porter, a professor at the Harvard Business School, is widely credited with taking the concept of strategic reasoning to another level. Porter tackled the question of how organizations could effectively compete and achieve a long-term competitive advantage. He contended that there were just three ways a firm could gain such advantage: 1) a cost-based leadership – become the lowest cost producer, 2) valued-added leadership – offer a differentiated product or service for which a customer is willing to pay a premium price, and 3) focus – compete in a niche market with laser-like fixation (Dess & Davis, 1984). Name a company that fits these profiles: How about Walmart for low-cost leadership. For value-added leadership, many think of Apple. Focus leadership is a bit more challenging. What about Whole Foods before being acquired by Amazon? Porter’s thinking on competition and competitive advantage has become timeless principles of strategic management still used today. Perhaps Porter’s most significant contribution to modern management thinking is the connection between a firm’s choice of strategy and its financial performance. Should an organization fail to select and properly execute one of the three basic strategies, it faces the grave danger of being stuck in the middle – its prices are too high to compete based on price or its products lack features unique enough to entice customers to pay a premium price. Consider the fate of Sears and Roebuck, J.C. Penny, K-Mart, and Radio Shack, organizations that failed to navigate the evolving nature of their businesses.

The 21st Century

Managers in the 21st century must confront challenges their counterparts of even a few years ago could hardly imagine. The ever-growing wave of technology, the impact of artificial intelligence, the evolving nature of globalization, and the push-pull tug of war between the firm’s stakeholder and shareholder interests are chief among the demands today’s managers will face.

          Much has been written about the exponential growth of technology. It has been reported that today’s iPhone has more than 100,000 times the computing power of the computer that helped land a man on the moon (Kendall, 2019). Management today has to grapple with the explosion of data now available to facilitate business decisions. Data analytics, the examination of data sets, provides information to help managers better understand customer behavior, customer wants and needs, personalize the delivery of marketing messages, and track visits to online web sites. Developing an understanding of how to use data analytics without getting bogged down will be a significant challenge for the 21st century manager. Collecting, organizing, utilizing data in a logical, timely, and cost-effective manner is creating an entirely new paradigm of managerial competence.  In addition to data analytics, cybersecurity, drones, and virtual reality are new, exciting technologies and offer unprecedented change to the way business is conducted. Each of these opportunities requires a new degree of managerial competence which, in turn, creates opportunities for the modern-day manager.

Artificial Intelligence

Will robots replace workers? To be sure, this has already happened to some degree in many industries. However, while some jobs will be lost to AI, a host of others will emerge, requiring a new level of management expertise. AI has the ability to eliminate mundane tasks and free managers to focus on the crux of their job. Human skills such as empathy, teaching and coaching employees, focusing on people development and freeing time for creative thinking will become increasingly important as AI continues to develop as a critically important tool for today’s manager.

Globalization

Globalization has been defined as the interdependence of the world’s economies and has been on a steady march forward since the end of World War II. As markets mature, more countries are moving from the emerging ranks and fostering a growing middle class of consumers. This rising new class has the purchasing power to acquire goods and services previously unattainable, and companies around the globe have expanded outside their national borders to meet those demands. Managing in the era of globalization brought a new set of challenges. Adapting to new cultures, navigating the puzzle of different laws, tariffs, import/export regulations, human resource issues, logistics, marketing messages, supply chain management, currency, foreign investment, and government intervention are among the demands facing the 21st century global manager. Despite these enormous challenges, trade among the world’s nations has grown at an unprecedented rate. World trade jumped from around 20% of world GDP in 1960 to almost 60% in 2017.

Trade as a Percent of Global GDP

Despite its stupendous growth, globalization has its share of critics. Chief among them is that globalization has heightened the disparity between the haves and the have-nots in society. Opponents of globalization argue that in many cases, jobs have been lost to developing nations with lower prevailing wage rates. Additionally, inequality has worsened with the wealthiest consuming a disproportionate percent of the world’s resources (Collins, 2015). Proponents counter that on the macro level, globalization creates more jobs than are lost, more people are lifted out of poverty, and expansion globally enables companies to become more competitive on the world stage.

Since the election of Donald Trump as President of the United States in 2016 and Great Britain’s decision to exit the European Union, the concept of nationalism has manifested in many nations around the globe. Traditional obstacles to expanding outside one’s home country plus a host of new difficulties such as unplanned trade barriers, blocked acquisitions, and heightened scrutiny from regulators have added to the burdens of managing in the 21st century. The stage has been set for a new generation of managers with the skills to deal with this new, complex business environment. In the 20th century, the old command and control model of management may have worked. However, today, with technology, artificial intelligence, globalization, nationalism, and multiple other hurdles, organizations will continue the move toward a flatter, more agile organizational structure run by managers with the appropriate 21st century skills.

Stakeholder versus Shareholder

What is a stakeholder in a business, and what is a shareholder? The difference is important. Banton (2020) noted that shareholders, by owning even a single share of stock, has a stake in the company. The shareholder first view was put forth by the economist Milton Friedman (1962) who stated that “There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits so long as it engages in open and free competition, without deception or fraud” (p. 133). In other words, maximize profits so long as the pursuit of profit is done so legally and ethically. An alternate view is that a stakeholder has a clear interest in how the company performs, and this interest may stem from reasons other than the increase in the value of their share(s) of stock. Edward Freeman (1999), a philosopher and academic advanced his stakeholder theory contending that the idea was the success of an organization relied on its ability to manage a complex web of relationships with several different stakeholders. These stakeholders could be an employee, a customer, an investor, a supplier, the community in which the firm operates, and the government that collects taxes and stipulates the rules and regulations by which the company must operate. Which theory is correct? According to Emiliani (2001), businesses in the United States typically followed the shareholder model, while in other countries, firms tend to follow the stakeholder model. Events in the past decade have created a shift toward the shareholder model in the United States. The financial crisis of 2008/2009, global warming, the debate between globalization and nationalism, the push for green energy, a spate of natural disasters, and the world-wide impact of health crises such as AIDS, Ebola, the SARS virus and the Coronavirus have fostered a move toward a redefinition of the purpose of a corporation. In the coming decades, those companies that thrive and grow will be the ones that invest in their people, society, and the communities in which they operate. The managers of the 21st century must build on the work of those that proceeded them. Managers in the 21st century would do well if they heeded the words famously used by Isaac Newton who said “If I have seen a little further, it is because I stand on the shoulders of giants” (Harel, 2012).

Critical Thinking Questions

In what way has the role of manager changed in the past twenty years?

With the historical perspective of management in mind, reflect on changes you foresee in the manager’s role in the next 20 years?

Reflect on some of the significant issues you have witnessed in the past few years.  Among thoughts to consider are global warming, green energy, global health crisis, globalization, nationalism, national debt, or an issue of your choosing.  What role do you see business and management playing in effectively dealing with that specific issue?

How to Answer the Critical Thinking Questions

For each of these answers you should provide three elements.

• General Answer.  Give a general response to what the question is asking, or make your argument to what the question is asking.
• Outside Resource.  Provide a quotation from a source outside of this textbook.  This can be an academic article, news story, or popular press.  This should be something that supports your argument.  Use the sandwich technique explained below and cite your source in APA in text and then a list of full text citations at the end of the homework assignment of all three sources used.
• Personal Story.  Provide a personal story that illustrates the point as well.  This should be a personal experience you had, and not a hypothetical.  Talk about a time from your personal, professional, family, or school life.   Use the sandwich technique for this as well, which is explained below.

Use the sandwich technique:

For the outside resource and the personal story you should use the sandwich technique.  Good writing is not just about how to include these materials, but about how to make them flow into what you are saying and really support your argument.  The sandwich technique allows us to do that.  It goes like this:

Step 1:  Provide a sentence that sets up your outside resource by answering who, what, when, or where this source is referring to.

Step 2:  Provide the quoted material or story.

Step 3:  Tell the reader why this is relevant to the argument you are making.

Allison, S. (2014). An essential book for founders and CEOs: In Search of Excellence. Forbes. Retrieved from https://www.forbes.com/sites/scottallison/2014/01/27/an-essential-book-for-founders-and-ceos-in-search-of-excellence/#5a48e7da6c11

Banton, C. (2020). Shareholder vs. stakeholder: An overview. Investopedia. Retrieved from https://www.investopedia.com/ask/answers/08/difference-between-a-shareholder-and-a-stakeholder.asp

Collins, M. (2015). The pros and cons of globalization. Forbes. Retrieved from https://www.forbes.com/sites/mikecollins/2015/05/06/the-pros-and-cons-of-globalization/#609d7a53ccce

Dess, G.G., & Davis, P.S. (1984). Generic strategies as determinants of strategic group membership and organizational performance. The Academy of Management , (27)3, 467-488.

Difrancesco, J.M. & Berman, S.J. (2000). Human productivity: The new American frontier. National Productivity Review. Summer 2000. 29-36.

Drucker, P. F. (2008 ) Management – Revised Edition . New York: Collins Business.

Edersheim, E. (2007). The Definitive Drucker. New York: McGraw-Hill.

Emiliani, M.L. (2001). A mathematical logic approach to the shareholder vs stakeholder debate. Management Decision . (39)8, 618-622.

Fayol, H. (1949). General and Industrial Management . London: Sir Isaac Pitman & Sons (translated by Constance Storrs).

Freeman, E.R. 91999). Divergent stakeholder theory. The Academy of Management Review , (24)2, pp. 213-236.

Friedman, M, (1962). Capitalism and Freedom , Chicago: University of Chicago Press.

Harel, D. (2012). Standing on the shoulders of a giant. ICALP (International Colloquium on Automation). 16-22. Retrieved from http://www.wisdom.weizmann.ac.il/~/dharel/papers/Standing%20on%20Shoulders.pdf

Herzberg, F. (1968). One more time: How do you motivate employees ? Harvard Business Review, January-February. pp 53-62.

Higgins, J.M. (1991). The Management Challenge: An Introduction to Management . New York: Macmillan

Kendall, G. (2019). Your mobile phone vs. Apollo 11’s guidance computer. Real Clear Science. Retrieved from https://www.realclearscience.com/articles/2019/07/02/your_mobile_phone_vs_apollo_11s_guidance_computer_111026.html

Klaess, J. (2020). The history and future of the assembly line . Tulip . Retrieved from https://tulip.co/blog/manufacturing/assembly-line-history-future/

Koontz, H., & O’Donnell, C. (1955). Principles of Management: An Analysis of Managerial Functions . New York: McGraw-Hill.

Kopelman, R.E., Prottas, D.J., & Davis, A.l. (2008). Douglas McGregor’s Theory X and Y: Toward a construct-valid measure. Journal of Managerial Issues , (XX02, 255-271.

Mintzberg, H. (1973). The Nature of Managerial Work. In S. Crainer (Ed.).  The Ultimate Business Library (pp. 174). West Sussex, UK: Capstone Publishing.

Nixon, L. (2003). Management theories – An historical perspective.  Business Date, (11)4, 5-7.

Pindur, W., Rogers, S.E., & Kim, P.S. (1995). The history of management: a global perspective. Journal of Management History , (1) 1, 59-77.

Wilson J.M. (2015). Ford’s development and use of the assembly line, 1908-1927. In Bowden and Lamond (Eds.), Management History. It’s Global Past and Present (71-92). Charlotte, NC: Information Age, Publishing, Inc.

Wren, D.A., & Bedeian, A.G. (2009). The Evolution of Management Thought. Hoboken, NJ. John Wiley & Sons, Inc. Hoboken, NJ

The Four Functions of Management Copyright © 2020 by Dr. Robert Lloyd and Dr. Wayne Aho is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License , except where otherwise noted.

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Management’s Three Eras: A Brief History

by Rita McGrath

Organization as machine – this imagery from our industrial past continues to cast a long shadow over the way we think about management today. It isn’t the only deeply-held and rarely examined notion that affects how organizations are run. Managers still assume that stability is the normal state of affairs and change is the unusual state (a point I particularly challenge in The End of Competitive Advantage ). Organizations still emphasize exploitation of existing advantages , driving a short-term orientation that many bemoan. (Short-term thinking has been charged with no less than a chronic decline in innovation capability by Clayton Christensen who termed it “the Capitalist’s Dilemma.” ) Corporations continue to focus too narrowly on shareholders , with terrible consequences – even at great companies like IBM .

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In This Article Expand or collapse the "in this article" section Management History

Introduction, introductory works.

• Reference Resources
• The Importance of History
• Before Common Era
• Early Common Era
• The Fifteenth–Eighteenth Centuries
• The Industrial Revolution
• Scientific Management and Frederick Taylor
• Other Contributors to Scientific Management
• The Human Side
• Organization Theory
• Theory Integration
• Complexity Revealed
• Developments

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• Approaches to Social Responsibility
• Certified B Corporations and Benefit Corporations
• Human Resource Management
• Management In Antiquity
• Management Research during World War II
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• Stakeholders

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Management History by David D. Van Fleet LAST REVIEWED: 29 June 2015 LAST MODIFIED: 29 June 2015 DOI: 10.1093/obo/9780199846740-0008

Although management and attempts to improve it are as old as civilization, the systematic study of management is only just more than one hundred years old. “Management history” refers primarily to the history of management thought as it has developed during that time, although some work covers the practice of management all the way back to Antiquity. Because the events, organizations, economic and social conditions, and even interested scholars are frequently the same, management history overlaps to some extent with related history fields, most notably business history, economic history, and accounting history. Management history utilizes the tools and methods of traditional historical analysis as well as drawing insights from business disciplines and the social sciences. This article includes, first, initial coverage of source material (introductory works, reference sources, and journals), and then presents reasons why history is important and provides a rough chronological presentation of major works for those interested in learning more about management history, from the early practice of management to the evolution of management thought as it has developed during the past one-hundred-plus years.

Some early management books are available online so that students and other scholars can read them in the original form, including Taylor 2010 (cited under Scientific Management and Frederick Taylor ), Sheldon 1924 (cited under Organization Theory ), and Gilbreth 2010 (cited under Other Contributors to Scientific Management ). Many early articles on management may be found in Miner 1995 and Bedeian 2011 . Wren and Bedeian 2008 is the most important management history book, and it is the one most widely used as a primary source in courses on management history. George 1972 , though an older work, is sometimes also recommended.

Bedeian, Arthur G., ed. The Evolution of Management Thought: Critical Perspectives on Business and Management . 4 vols. London: Routledge, 2011.

More than one hundred articles covering more than a century of management literature; a must-read for any serious student of management history.

George, Claude S., Jr. The History of Management Thought . 2d ed. Englewood Cliffs, NJ: Prentice Hall, 1972.

A short, older overview of the development of management thinking that is still useful for the author’s insights.

Miner, John B., ed. Administrative and Management Theory . Aldershot, UK: Dartmouth, 1995.

Numerous articles spanning more than seventy-five years are collected here. Readers get an intimate feel for the evolution of management theory through reading these original articles.

Wren, Daniel A., and Arthur G. Bedeian. The Evolution of Management Thought . 6th ed. Hoboken, NJ: Wiley, 2008.

A highly readable summary of major milestones in the development of management thought. Presented within the context of the times, the stories of major figures in the field are told.

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Management History and Its Key Milestones Essay

Attempts to create a formal approach to studying the working process were made at the end of the nineteenth century, and most of the major advancements in management theory were made in the course of the twentieth century. Scientific management theory was the first school that used a formalized approach to leadership and, despite many limitations, provided a good starting point for the development. The behavioral theory emphasized the importance of understanding psychology for successful management. The quantitative school used science and mathematics for efficient planning. New ways to look at organizations and approach leadership problems were provided by the systems theory and contingency paradigm.

Management theories consist of rules and methods that can be applied to effectively run an organization. Studying the evolution of different schools of thought helps better understand the principles and approaches that provide a theoretical framework for leadership. Management theories started to develop in the late nineteenth century and saw major advancement in the twentieth century. This paper discusses the five key milestones in the history of management: scientific, behavioral, quantitative, systems, and contingency theories.

One of the first major advancements in management theory was made at the beginning of the twentieth century with the creation of the scientific management theory. This approach was formulated by Frederic Winslow Taylor in 1909 (Khorasani & Almasifard 2017). At that time, there were not any structured theories of leadership, and business owners used common sense and personal understanding while running their companies. Taylor and his colleagues were the first who employed the scientific approach to studying the work process. Taylor’s management theory is focused on the productivity of employees and the efficiency of an organization. Tayler suggested that an employer should assign fixed, well-defined roles to each worker, monitor the work process and use financial rewards as a form of motivation. It was also emphasized that hierarchy should be based on merit (Khorasani & Almasifard, 2017). The main limitation of this paradigm is that it evaluates workers solely by productivity and does not take into account initiative and innovation.

The establishment of the behavioral theory was another milestone in the history of management. The advancements and growing public interest in the field of psychology in the first half of the twentieth century led to attempts to apply the understanding of basic behavioral principles to business. The work of Abraham Maslow in studying human needs and motivation made a substantial contribution to the development of this approach. Unlike the scientific management theory that used monitory rewards as the only form of motivation, the behavioral paradigm suggested that managers should understand the human aspect of employees to achieve objectives (Khorasani & Almasifard 2017). This school was the first to emphasize the importance of worker satisfaction and working conditions. Behaviorists encouraged businesses to treat workers as valuable assets, taking into account human needs. At the same time, critics of behavioristic methods outlined that the theorists based their conclusions on simplistic interpretations of psychology without providing sufficient evidence (Khorasani & Almasifard 2017). Thus, the behavioral theory played a big role historically by turning attention to employees, but it was limited by the lack of scientific evidence and oversimplification of human psychology.

The collective work of many scientists during the Second World War and the creation of the computer led to a new advancement in management. The quantitative school uses a structured scientific approach and mathematical modeling to handle complex management problems. George Dantzig, who suggested using advanced mathematics and quantitative techniques in planning, is considered the father of this approach. The main problem of this method is the fact that it is often impossible to create a model that would take into account all variables involved in a complex process. In addition to that, quantitative techniques take a significant amount of time to use, which results in delays in work (Khorasani & Almasifard 2017). This approach to management can be effective in some areas, especially in science, but there are setbacks that limit its application.

Another milestone in the evolution of management is the establishment of the systems theory in the 1960s. American economist Herbert Alexander Simon is the father of this school. The creation of this new approach was made possible by the emergence of new interdisciplinary methods that could be applied to business. Systems management theory treats an organization as a complex system of interconnected parts, each of which has its function. Opposite to the proceeding schools of management that teach that there might be only one right solution for a problem, the systems theory states that goals can be achieved in many ways. This paradigm allows to describe processes in an organization and to develop mechanisms to achieve objectives. The shortcomings of the approach come with the fact that the nature of the relationships between different entities is sometimes hard to define (Khorasani & Almasifard 2017). Despite some limitations, this systematic approach can be effective in many situations, and it is still used now.

The contingency paradigm was the next important step in the evolution of modern management. This approach is based on contingency modeling of leadership that was introduced by Fred Fiedler in 1967. The importance of this theory lies in the fact that it provided an innovative way of looking at old problems. The contingency approach is based on the idea that the effectiveness of leadership depends on the application of management in a specific situation and requires flexibility and adjustability. A high level of complexity and the necessity for a substantial amount of analysis, together with the reactive nature of this methodology, are the main limitations of contingency theory (Otley, 2016). In spite of the sophistication inherent to this way to manage an organization, this approach remains widely used because of its effectiveness in dealing with complex problems.

Looking at the evolution of management theories provides multiple insights that help understand the subject. Various schools focus on different aspects of leadership and develop tools that can be applied to solve problems and increase the efficiency of an organization. Although all of the paradigms that have been discussed in this paper have some limitations, understanding their central principles allows us to successfully use them to achieve goals.

Khorasani, S. & Almasifard, M. (2017). Evolution of management theory within 20 century: A systemic overview of paradigm shifts in management. International Review of Management and Marketing , 7(3), 134-137. Web.

Otley, D. (2016). The contingency theory of management accounting and control: 1980–2014. Management Accounting Research , 31 , 45-62.

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History of Management Essay

Fundamentals of management (mgmt100), university of canterbury.

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Name: Rosa Dalgleish

Student number: 78530259

Assignment: History of Management Essay

Word count: 996

The history of management has evolved significantly over time. Looking back on previous management perspectives allows a broader understanding of how to respond to current issues within organisations. This essay will discuss the four perspectives of the evolution of management history in chronological order. The perspectives in discussion are classical, humanistic, management science and recent historical trends.

The first perspective in discussion is classical, which emerged during the nineteenth century. When the factory systems of the 1800’s begun to pose challenges that organisations had not experienced previously, the classical perspective emerged [CITATION Sam16 \p 53 \l 1033 ]. It focusses on the efficiency of employees to increase productivity of organisations (Samson et al., 2016). There are three subcategories of the classical perspective, scientific management, bureaucratic organisations and administrative principles.

Scientific management was first introduced by Frederick Taylor (1856- 1915) and concentrated on increasing productivity of employees to increase economic efficiency (Samson et al., 2016). Taylor held the view that worker productivity could be controlled using scientific studies to create rules and guidelines for managers to use. The principles of scientific management include developing the best method for each task, choosing workers with appropriate abilities, training workers in standard methods, providing incentives and supporting workers through vigilant planning (Samson et al., 2016, p. 55). The ideas of scientific management significantly increased efficiency in companies across all industries, and many companies continue to use these ideas (Samson et al., 2016, p. 55). However, this perspective does not acknowledge the variance between individuals, the social context of the workplace or workers higher needs.

Bureaucratic management looks at the organisation as a whole and was introduced by Max Weber (1864-1920) (Samson et al., 2016, p. 55). This approach to management focuses on organisational operation in a rational manner. Bureaucracy evolved during the late 1800’s due to organisations being managed on a personal basis, with employees using resources to create individual benefit instead of organisational benefit (Samson et al., 2016, p. 56). Webbers characteristics of bureaucracy were a clear division of labour with a well-defined hierarchy, employees selected based on their qualifications and ensuring management and ownership are separated within the organisation (Samson et al., 2016).

Administrative principles focus on the co-ordination of internal activities of an organisation by managers. Henry Fayol (1841-1925) outlines the five functions of management as organising, planning, commanding, co-ordinating and controlling (Samson et al., 2016, p. 58). Fayol’s perspective took individuals who work in organisations into account unlike the scientific theory (Samson et al., 2016).

The second perspective of management is the humanistic perspective, which focuses on understanding human behaviour, social needs and the effect of group dynamics on productivity (Samson et al., 2016, p. 59). Mary Parker Follet (1860-1933) was an early advocate for this perspective and highlighted the importance of worker participation and shared goals between managers (Samson et al., 2016, p. 59).

The human relations movement of the humanistic perspective emphasises that effective control comes from within the worker rather than from authoritarian control (Samson et al., 2016). This thought process was a response to social pressures to improve employee treatment. The Hawthorne studies of the 1920’s displayed that managers having added interest in employees has the most significant impact on worker productivity, which started a revolution in the treatment of employees (Samson et al., 2016, 60).

The human resources perspective espoused that daily jobs shouldn’t be viewed as dehumanising, but should allow for self-actualisation (Samson et al., 2016, p. 61). Douglas McGregor (1906- 1964) was one contributor to this perspective with his theory X and theory Y managers. Theory X managers assume workers dislike work and must be coerced to put adequate effort into their work. This is what McGregor believed the classical perspective was based on (Samson et al., 2016). Theory Y managers naturally like work and are capable of

the four principles in discussion, and help managers make appropriate decisions in response to issues within organisations.

Bibliography

Samson, D., Catley, D., Cathro, V., & Daft, R. (2016) Management in New Zealand: 2nd Asia-Pacific Edition. Cengage Learning.

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The history of management: a global perspective

1995, Journal of Management History

Contemporary management theory is not a single theory. By its very nature, management is a complex process and a multidisciplinary field of study. Contemporary management is a synthesis of the classical, behavioural, quantitative and modern management movements. One of the keys to successful management is the ability to understand and apply modern management principles and techniques effectively. Studying fundamental concepts provides a foundation that effective managers of the future need in terms of understanding techniques, organizational cultures and theories. Awareness and willingness of management to incorporate a variety of management theories and tools as the organization constantly changes are keys to gaining and maintaining competitive advantage over others.

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Histories of management have two deficiencies; (a) they fail to distinguish managing a business from other types of managing, (b) they are more often histories of writing about management than of doing it. Explaining management requires attention to the nature of the thing being managed - the firm. The history must hinge on specific aspects that distinguish today’s management from that of former times; and various have been advanced - scale, technology, and globalization. Yet all were evident long ago and miss what is modern about modern management. This entry treats the modern-ness of the mode of business administration as key to understanding the modern firm. Following Weber the bureaucratic mode is tempting, but once we accept Knightian uncertainty bureaucratic theory cannot be an adequate guide to today’s managerial practice. Modern firms align employees’ judgment rather than their blind obedience by providing them with a corporate citizenship that echoes but differs from that provided earlier by guilds. The history of managing is of this transition.

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History of Management Thought

Genesis and Development from Ancient Origins to the Present Day

• © 2021
• Vadim I. Marshev   ORCID: https://orcid.org/0000-0002-1808-2054 0

Faculty of Economics, Moscow State University, Moscow, Russia

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• Introduces the specific problems of historical management research
• Helps study methods and be able to apply them to find sources of management ideas
• Describes the management ideas in specific regions of the world and in specific historical conditions
• Identifies the factors and causes of the genesis, formation, change and development of views on the management of social processes in specific historical conditions

Part of the book series: Contributions to Management Science (MANAGEMENT SC.)

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About this book

This book describes the millennia-long process of the genesis, formation, struggle, and change of views on the management of social organizations in various countries around the world; in other words, it characterizes the worldwide evolution of the History of Management Thought (HMT) - ideas, concepts, theories, paradigms, and scientific schools - from Antiquity to the present.

This book presents both the origins of management thought dating back to the 5th millennium BC and the latest management concepts of the early 21st century. In particular, it traces the origins and sources of management thought, reflected in the works of thinkers and statesmen of the Ancient World (Egypt, Western Asia, China, India, Greece, and Rome), the era of feudalism, and the Middle Ages (Byzantium, Western Europe, and England), the era of inception capitalism (Western Europe and the USA), as well as the new and recent history of management thought of the 20th and 21st centuries. In addition, for the first time in History of Management literature, it presents the history of Russian management thought from the 9th century to modern concepts and scientific schools.

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The Philosophy of Management Today

Management in the Age of Prosperity, c. 1940–1990: Section Introduction

• Management development
• Philosophies of management
• Evolution of management principles
• Managerial thought in Byzantium
• Instrumental concepts of management
• Management development in Russia
• Chinese management principles
• Theory of organizational development

Table of contents (8 chapters)

Front matter, issues of historical and managerial research.

Vadim I. Marshev

Genesis and Development of World Management Thought from Ancient Times to the End of the XIX Century

The origins of management thought: from fifth millennium b.c. to the fifth century, world management thought in the fifth to nineteenth centuries, the emergence and formation of management thought in russia (ninth to eighteenth centuries), management thought in russia in 1800–1917, new and newest history of management thought, western schools of management of the twentieth century, development of the scientific basis of management in the ussr and in russia in twentieth century, actual problems and concepts of management, back matter, authors and affiliations, about the author.

Vadim I. Marshev is the Distinguished Professor of the Moscow University and a Professor at the Faculty of Economics of Moscow State University (Russia). His research and teaching expertise span across Organization Theory, General Management of Organization, Strategic Management, History of Management Thought, Change Management, Scenario-based Management, Family Business Management, Sport Management.

Prof. Marshev is also a renowned consultant in the fields of general management, restructuring, and strategy development. He is a member of the National Association of Independent Directors (Russia) and the Russian Institute of Corporate Directors. On the academic side, he is a member of the Editorial Board of the Journal "Management Sciences" (Russia) and a Member of the Academy of Management (Management History division and Organization and Management Theory division).

Bibliographic Information

Book Title : History of Management Thought

Book Subtitle : Genesis and Development from Ancient Origins to the Present Day

Authors : Vadim I. Marshev

Translated by : Oleg Geraschenko

Series Title : Contributions to Management Science

DOI : https://doi.org/10.1007/978-3-030-62337-1

Publisher : Springer Cham

eBook Packages : Business and Management , Business and Management (R0)

Copyright Information : Moscow State University Lomonosov 2021

Hardcover ISBN : 978-3-030-62336-4 Published: 14 January 2021

Softcover ISBN : 978-3-030-62339-5 Published: 14 January 2022

eBook ISBN : 978-3-030-62337-1 Published: 13 January 2021

Series ISSN : 1431-1941

Series E-ISSN : 2197-716X

Edition Number : 1

Number of Pages : XV, 710

Number of Illustrations : 5 b/w illustrations, 6 illustrations in colour

Additional Information : Translated from the Russian original: Marshev V. I.(2005) History of Management Thought, ISBN 5-16-00215-2 © Faculty of Economics Moscow State University, 2005 © Design. INFRA M, 2005

Topics : Management Education , Philosophy of the Social Sciences , Cultural History , Management , Human Resource Management

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