1. PHILOSOPHIES &
APPROACHES TO
MANAGEMENT PRACTICES
Lav Nigam

2. DEFINITION OF MANAGEMENT
Definition:
“ Effective & Efficient integration & coordination of resources to achieve
the desired objectives”.
Thus, management is a process by which managers create a climate so
that employee achieves both personal & organizational growth.
This implies:
 Process by which personal & organizational goals achieved
 Process implies planning, organizing, staffing, leading & controlling –
functions of management
 Management process influenced by environment – external & internal
 Managers act as facilitators for achievement of goals.
2

3. EVOLUTION OF MANAGEMENT
THOUGHT
Management as a systematic body of knowledge & identifiable discipline is
product of 20th century. However, as a practice, it has been in existence for
centuries since man combined efforts with other for achievement of common
goals.
Ancient Indo-Gangetic, Egyptian & Roman civilization would not have attained
glory without organization and management of group activities.
Egyptian pyramid: It took 100,000 individuals 20 years effort to create the
pyramids of Cheops.
Greek: Plato in his “Republic” refers to various jobs being done by workmen &
excelling in them – principle of division of labor
Chinese: Sun Tzu, Chinese philosopher, in “The Art Of War”, written 2000 years
ago gave guidelines for military leaders – useful today for planning strategy to
handle competitors.
. Italy: Machiavelli, Italian philosopher & diplomat, in his well known work “
The Prince” gives broad management principles which all managers should
subscribe. Four principles of leadership are:
 Mass Content – leader is a leader only if followers agree
 Strive for Cohesiveness by rewarding friends & supporters
 Will to survive under all odds
 Set an example to the follower

4. EVOLUTION OF MANAGEMENT
THOUGHT
Some of the modern management principles & techniques owe their origin to military
organizations. The pyramid structure of modern organization, principles of
authority & responsibility, specialization along functional lines, use of staff device
& other organization & management principles & practices were developed &
used by Roman Catholic Church & military organizations long before they were
used by modern business enterprise.
During industrial revolution, trade & commerce was conducted in limited scale. By
1950, factory system was popular in Great Britain. During this period, with
development of manufacturing technologies, commerce grew. Organizations
started growing in size, increasing need of better management practices.
Growth of industrialization attributed to two individuals – James Watt & Adam Smith.
 In 1781, Watt developed rotary engine making technology more adaptable to
factory use.
 In 1776, Adam Smith popularized principle of division of labor. His example of
manufacturing of common pins demonstrates this principle – one man draws
wire, another straightens it, third cuts it, fourth points it, fifth grinds it at top for
receiving the head etc. This specialization could make 12 pounds of pin per day
against only 20 pins per person, when working alone on the total process.

5. MAJOR SCHOOLS OF
MANAGEMENT
THE FIVE MAJOR SCHOOLS OF MANAGEMENT:
1. CLASSICAL SCHOOL - Managing workers and organizations more
efficiently.
 Scientific Management - 1880s

Administrative Management - 1940s
 Bureaucratic Management - 1920s
2. BEHAVIORAL SCHOOL - Understanding human behavior in the
organization.
 Human Relations - 1930s
 Behavioral Science - 1950s

6. MAJOR SCHOOLS OF
MANAGEMENT
3. QUANTITATIVE SCHOOL - Increasing quality of managerial decision-making
through the application of mathematical and statistical methods.
 Management Science 1940s
 Operations Management 1940s

Management Information Systems 1950s—1970s
4. SYSTEMS SCHOOL 1950s - Understanding the organization as a system
that transforms inputs into outputs while in constant interaction with its'
environment.
5. CONTINGENCY SCHOOL 1960s - Applying management principles and
processes as dictated by the unique characteristics of each situation.

7. CLASSICAL SCHOOL
The Classical School - Forms the foundation for field of management thought,
hence classical. Includes the following theories:
1. Scientific Management Theory developed by Fredrick Taylor
2. Management Process Theory developed by Henri Fayol
3. Theory Of Bureaucratic organization by Max Weber
1. Scientific Management Theory: (One best way to do each job. Focus
on job level).
Fredrick Taylor (1856-1915), known as father of scientific management, based his
philosophy on following basic principles:
1. Determination of standards of performance – Instead of fixing standards
arbitrarily, time & motion study analysis of all operations & motions involved in
each job are conducted & timed using a stop watch. Standards of performance
are set.
2. Functional Foremanship – Instead of workers & supervisors determining the
sequence of operations & selection of tools, functional foreman, expert in their
area, should be involved in planning. If a job involved, say, 6-7 operations, worker
would receive instructions from as many function specialists. Worker was a doer.
Thus planning shifted from worker & supervisor to functional experts like industrial
engineers, quality control experts, safety experts etc.

8. CLASSICAL SCHOOL
3. Responsibility Of Management – Managers should accept responsibility for
planning, organizing & directing & to do in a scientific way. They should analyze
all operations & develop scientific methods of operations.
 Should develop a science for each element of work involved in operations to
replace rule of thumb.
 Workers should be scientifically selected & trained
 Managers should cooperate with workers to ensure that work is done according
to scientifically developed methods.
 Management should take over all work for which it is best suited like, planning,
organizing & directing.
4. Differential piecework system of wage payment - To ensure that worker gives
an optimum production, they should be motivated by being paid more. Ex: if
standard production is 50 units / day. Regular piece rate is 30p / piece &
differential rate is 40p. Hence, if worker produces < 50, he is paid @ 30 P. If
over 50, he is paid@ 40p. Approach is:.
 Give worker highest grade of work as per his ability & physique.

Require each workman to give maximum output .

Pay each workman who works at best pace, 30-100% beyond average rate.

9. CLASSICAL SCHOOL
5. Mental Revolution – Since the scientific techniques help the worker by way of
higher wages & employers in form of high production, it is essential that both
should have cooperative attitude. Revolution in attitude of worker towards
their work, fellowmen & supervisor. Revolution in attitude of manager
towards fellowmen, workers & the ways in which they handle their daily
problem.
Henry L. Gantt, a contemporary and associate of Taylor, emphasized the
psychology of the worker and the importance of morale in production.
 Gantt devised a wage payment system, which stimulated foremen and
workers to strive for improvement in work practices. Each worker who
reached daily standard was given 50 c bonus for that day. Every foreman
was given a bonus for each worker who reached daily standard, plus extra
bonus if all workers reached it.
 Gantt also developed a charting system for scheduling production, the “Gantt
chart” that remains the basis for modern scheduling techniques. PERT &
CPM are modern day control techniques.

10. CLASSICAL SCHOOL
Frank Gilbreth (1868-1924) & Lillian Gilbreth (1878-1972)
 Frank and Lillian Gilbreth, the husband-and-wife team made their contribution in
motion studies to find out the best sequence & minimum number of motions
required to complete the task, thus eliminating unnecessary motions & reducing
work fatigue.
 The Gilbreths catalogued seventeen different basic hand motions such as
“grasp”, “hold”, “search”, “select”, position”, etc which they called therbligs
(Gilbreth spelled backwards with t & h reversed).
 The Gilbreths also experimented with the design and use of the proper tools and
equipment for optimizing work performance.
 The Gilbreths were among the first to use motion picture films to study hand-
and-body motions of workers as they performed the task.
Limitations of Scientific Management:
 Regarded workers as uninformed and ignored their ideas.
 Dehumanization of workers.
 More stress on quantity rather than quality.
 Did not appreciate the higher needs of workers.
 Did not acknowledge differences among individuals.
 More importance to method rather than skill.

11. CLASSICAL SCHOOL
Management Process Theory: - General Administrative Approach - Henri
Fayol (1841-1925) – One best way to put an organization together
 Henri Fayol was a French industrialist who put forward & popularized the
concept of ‘universality of management principles’, the idea that all
organizations could be .structured and managed according to certain
rational principles.
 According to Fayol, business operations of an organization can be divided
into six activities - technical, commercial, accounting, financial, security, and
management.
 Fayol focused on managerial activity and described the practice of
management as distinct from the other business activities.
 Five major functions of management are planning, organizing, commanding,
coordinating and controlling.
 In his most significant work, “General and Industrial Management”, Fayol
discussed 14 general principles of management which he felt could be
applied in any organizational setting. Several of these principles are part of
management philosophy today.

12. CLASSICAL SCHOOL
FAYOL’S 14 PRINCIPLES OF MANAGEMENT :
1. Division of Labor. Work specialization results in improving efficiency of
operations. This principle is epitomized by the modern assembly line.
2. Authority. Managers must give orders so that they can get things done.
While their formal authority gives them the right to command, managers will
not always compel obedience unless they have personal authority (such as
relevant expertise) as well.
3. Discipline. Members in an organization need to respect the rules and
agreements that govern the organization. To Fayol, discipline results from
good leadership at all levels of the organization, fair agreements (such as
provisions for rewarding superior performance), and judiciously enforced
penalties for infractions.
4. Unity of Command. Each employee must receive instructions from only
one person. Fayol believed that when an employee reported to more than
one manager, conflicts in instructions and confusion of authority would
result.

13. CLASSICAL SCHOOL
5. Unity of Direction. Those operations within the organization that have the
same objective should be directed by only one manager using one plan. For
example, the personnel department in a company should not have two
directors, each with a different hiring policy.
6. Subordination of Individual Interest to the Common Good. In any
undertaking, the interests of employees should not take precedence over the
interests of the organization as a whole.
7. Remuneration. Compensation for work done should be fair to both
employees and employers.
8. Centralization. Decreasing the role of subordinates in decision-making is
centralization; increasing their role is decentralization. Fayol believed that
managers should retain final responsibility, but should at the same time give
their subordinates enough authority to do their jobs properly. The problem is
to find the proper degree of centralization in each case.

14. CLASSICAL SCHOOL
9. The Hierarchy. The line of authority in an organization – as
represented to day by boxes and lines of the organization chart – runs in
order of rank from top management to the lowest level of the enterprise.
10. Order. Materials and people should be in the right place at the right
time. People, in particular, should be in the jobs or positions they are
most suited to.
11. Equity. Managers should be both friendly and fair to their
subordinates.
12. Stability of Staff. A high employee turnover rate undermines the
efficient functioning of an organization.
13. Initiative. Employees should be encouraged to give suggestions &
develop new & better work practices.
14. Esprit de Corps. Promoting team spirit will give the organization a
sense of unity. To Fayol, even small factors should help to develop the
spirit. He suggested, for example, the use of verbal communication
instead of formal, written communication whenever possible.

15. CLASSICAL SCHOOL
Theory Of Bureaucratic Organization - Max Weber (1864-1920) –
Rational & impersonal organization way. “Bureaucracy” derived from
German buro, meaning office. Thus bureaucracy is a highly structured,
formalized & impersonal organization.
Max Weber, a German sociologist, developed a theory of authority
structures and described organizational activity on the basis of authority
relations.
 He described an ideal type of organization that he called a
bureaucracy, characterized by division of labor, a clearly defined
hierarchy, detailed rules and regulations, and impersonal
relationships.
 Weber also believed that technical competence should be emphasized
and that performance evaluations should be made entirely on the basis of
merit.
Weber recognized that this ideal bureaucracy did not exist in reality. He
used it as a basis for theorizing about work and the way work could be done
in large groups. His theory became the design prototype for many of today’s
large organizations.

16. HAWTHORNE STUDY
The Hawthorne Studies 1924 – 1930):
The Hawthorne studies undercut a core pillar of Taylor, that workers were
motivated purely by economic gain. Researchers from Western Electric and
Harvard University led by Elton Mayo, conducted a study at the Hawthorne plant of
General Electric to evaluate the attitude and psychological reactions of
workers in on-job situations. The group of workers was divided into two
subgroups: a test group, which would undergo environmental changes, and a
control group. The members of the control group would work under normal,
constant environment conditions. The researchers began by increasing the lighting
of the test group – the productivity of the test group increased, but the productivity
of control group also increased. This result was somewhat unexpected, since
lighting at the workstations of control group had not been altered. The researchers
then decreased the lighting at the test group’s workstations. Surprisingly, both the
test group and the control group continued to improve their productivity. There
were no decreases in productivity until the light was reduced to the point where the
workers could barely see. The researchers concluded that light did not have
significant impact on the motivation of workers & there were other factors
that were influencing productivity.

17. HAWTHORNE STUDY
The next experiment utilized a mainstay of scientific management: incentive-
based, piecework system. The researchers selected six women, who were
working in the relay assembly test room, for experiment. During the course of
experiments, a number of variables were altered - redesign of jobs, changes
in the lengths of the workday and workweek, introduction of rest periods, &
individual vs group wage plans. The workers received special attention from
researchers and company officials. Generally, productivity increased over the
period of study, regardless how the factors were altered.
The researchers concluded that employees would work harder if they
believed management was concerned about their welfare and
supervisors paid special attention to them.
This phenomenon was subsequently labeled the Hawthorne effect.
Mayo concluded that behavior and sentiments are closely related, that group
influences significantly affect individual behavior, that group standards
establish individual worker output, and that money is less a factor in
determining output than are group standards, group sentiments, and
security.
These conclusions led to a new emphasis on the human factor in the
functioning of organizations and the attainment of their goals. The Hawthorne
studies stimulated an interest in human factors.

18. BEHAVIORAL SCHOOL
Behavioral School: 20th century
Hawthorne studies led to the foundation for a behavioral approach to
management. As management research continued in the 20th century,
questions began to come up regarding the interactions and motivations of the
individual within organizations. Principles developed in classical period could
not answer this. Classical theory ignored employee motivation and behavior.
As a result, the behavioral school was a natural outgrowth of this
revolutionary management experiment.
The behavioral management theory is often called the human relations
movement because it addresses the human dimension of work. Behavioral
theorists believed that a better understanding of human behavior at work,
such as motivation, conflict, expectations, and group dynamics, improved
productivity.
The theorists who contributed to this school viewed employees as individuals,
resources, and assets to be developed and worked with — not as machines,
as in the past.

19. BEHAVIORAL SCHOOL
The best-known contributors to the human resources perspective are Abraham
Maslow, Douglas McGregor, and Frederick Herzberg.
Abraham Maslow (1908-1970), a practicing psychologist, proposed that the
people were motivated by a hierarchy of needs. His theory rested on three
assumptions:
1.All of us have needs which are never satisfied.
2.Through our actions, we try to fulfill our unsatisfied needs.
3.Human needs occur in the following hierarchical manner – (i) physiological
needs, (ii) safety or security needs, (iii) social needs, (iv) esteem needs, and (v)
self-actualization or self-fulfillment needs. In terms of motivation, Maslow argued
that each step in the hierarchy must be satisfied before the next level can be
activated and that once a need was substantially satisfied, it no longer
motivated behavior.

20. Self-Actualization
Esteem
Social
Safety
Physiological

21. BEHAVIORAL SCHOOL
Douglas McGregor (1906-1964) developed two assumptions about human
behavior, which he labeled Theory X and Theory Y. According to McGregor,
these two theories reflect the two extreme sets of belief that different managers
have about their workers.
Theory X presents an essentially negative view of workers. It assumes that
workers are lazy, have little ambition, dislike work, want to avoid responsibility,
and need to be closely supervised to work effectively.
Theory Y offers a positive view. It presumes that workers can be creative and
innovative, are willing to take responsibility, exercise self-control, and can enjoy
doing a job.
McGregor believed that the classical approach was based on Theory X
assumptions about workers.

22. BEHAVIORAL SCHOOL
Frederick Herzberg suggested that only higher psychological needs for
growth, challenge, responsibility, and self-fulfillment can positively motivate
workers to improved performance.
Work relationships and supervisory style along with pay and conditions reduce
dissatisfaction. Only the job itself could provide lasting satisfaction, and
Herzberg, in particular concentrated on ways of designing jobs for greater
worker satisfaction.
The behavioral approaches contributed an important awareness of the
influence of the human factor at work on organizational performance and
the need to offer job satisfaction to employees..

23. MODERN MANAGEMENT
THOUGHT
Modern Management Approaches:
Attempts to integrate various school of thought on assumption that no best way to
manage. Two major theories are:
1. The Systems Theory: There is only one system – universe.
Organization is sub-system composed of 4 inter-dependant components:
 Inputs (money, material, machine, informational sources required to produce
goods and services
 Transformation processes or throughput s – managerial & technical abilities
used to convert inputs into outputs
 Outputs are products and services, profits and other results produced by
organization
 Feedback refers to information about outcomes and position of the organization
relative to the environment it operates.
An activity in any part, affects, in varying degree, activity in other part.
Key concepts of systems approach are:
 Synergy: Departments within an organization which interact cooperatively are
more productive than if they operate in isolation.
 Open & Closed System: An open system interacts with the environment where
as closed system does not. All org interact with environment, but in varied extent.
Ex: advertising agency / jail.

24. MODERN MANAGEMENT
THOUGHT
 System Boundary: Each system has its boundaries which separate it from
other systems in environment. Open system, boundary is permeable, in closed
system rigid.
 Flow: Every system has flows of information, materials, & energy. These enter
the system as inputs (ex; raw material), undergo transformation within system
(ex; production) & exit as output (ex: good).
 Feedback: Is a mechanism of control to detect any deviation from plans so that
corrective action can be taken.
The system approach ensures manager must not be pre-occupied with one part but
with the other parts of the system. Ex: Marketing manager must consider
production numbers, resource availability & competition when committing
orders.
2. The Contingency Approach: (Situational approach)
Widely used in recent years to integrate management theory with complexity of
organization. There is no one best way to manage all situations. Based on the
notion that proper management technique in a given situation depends on the
nature & conditions of that situation. Manager should decide the best course of
action.
.

25. MODERN MANAGEMENT THOUGHT
Based on three characteristics:
1. Open System Perspective: Fundamental characteristic. Necessary to
understand how organizational sub-systems combine together to interact with
environment
2. Research Orientation: Practical research on situational refinements leads to
more effective on-the-job management.
3. Multivariate approach: Multivariate analysis is used to determine how several
variables interact to produce an outcome. Ex: Changes in productivity due to
variation in employee’s personality, nature of task, superior leadership style,
incentives etc.
Recent Developments: 20th century has seen lot of developments in industry due
to globalization of business. Major is Theory Z developed by William Ouchi.
Theory Z is an approach to management based upon a combination of American
and Japanese management philosophies and characterized by, among other
things, long-term job security, consensual decision making, slow evaluation
and promotion procedures, and individual responsibility within a group
context. Proponents of Theory Z suggest that it leads to improvements in
organizational performance.

26. Ouchi Theory Z

27. THANK YOU