History / Origins of Mangement

Management history / Origins of management


There are two significant historical events that lead to management study. They are;

1. Division of labor
Also known as job specialization. Stated by Adam Smith in 1776, concludes that division of labor increased productivity by increasing each workers skill, saving time lost in changing task, and by creating labor-saving inventions and machinery.

2. Industrial revolution
The substitution of machine power for human power, which made it more economical to manufacture goods in factories rather than at home. Large efficient factories need one person to forecast demand, ensure that enough material for making the products, assign tasks to people, direct daily activities and so forth. And the person is the manager.

An understanding of this history makes you appreciate current practices and realize that, in today’s global market, success can be fleeting if managers become complacent.



Development of major management theories;

1. Scientific management

Found by Frederick W. Taylor. He made important contributions to scientific management theory and known as the father of scientific management. He stated 4 principles of management. Taylor’s focus was on the factory floor because that’s where he thought the greatest increase in productivity. He scientifically applying different combination of procedures, techniques and tools and he put the right person on the job. He believes it was management’s job to instruct workers to do their job “the one best way”.


2. Administrative management

Found by Henry Fayol. He identified 5 functions of managers; planning, organizing, commanding, coordinating and controlling. His belief that management was an activity common to all business practitioners, government agencies and even in home. He also develops 14 principles of management. His theory focused on describing what managers do and what constitutes good management practice.


3. Bureaucracy management

Found by Max Weber. It is a form of organization characterized by division of labor, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationship.


4. Behavioral approach of management

Organization behaviour is the study of people at work. Hawthorne studies were most important contribution, started as scientific management experiment and went through several phases including illumination phase and group studies. A Hawthorne study is done during the 1920s and 1930s that provided new insights into individual and group behaviour. The conclusion to the studies is people’s behaviour and attitudes are closely related. It led to a new emphasis on human behaviour factor in the management of organizations. The studies provided the transition from mechanistic view of workers to a more humanistic view.



Systems perspectives

This system is a good way to view organizations because it reflects how organizations really work. There are two aspects you need to understand about systems perspectives;

1. Continuous cycle - organizations need resources (inputs) in order to functions. The organizations will process the input to get the output (goods & services). If the consumers purchase or use the organization’s output, the financial resources (profit) will flow back to the organization so that additional resources can be obtained.
2. Concept of open systems – important for understanding how organizations function. Organization are open (interact with and influences its environment). The organization obtains the resources (input) from environment and processes it into output. Then the output will placed (market) in the environment.



Contingency approach

Contingency approach/perspective can be describe as “if, then” (if this is the way my situation is, then this is the best way for me to manage). In contingency perspective, the way to manage ‘depends on the situation’. In management approach, it says that organizations are different, will face different situations (contingency) and require different ways of managing. In contingency theory, ‘a common body of knowledge is needed for different situations’. Because of this differences in managerial situation, it doesn’t mean that we can’t develop common information (common body of knowledge) for understanding how best to manage in those situations.