Many books have been written about management theory. There are books on scientific management, administrative management, bureaucratic management and classical management, to name a few theories. What are these management theories, and when and where did they get started?
While people have been managing work for hundreds of years, most of the significant ideas in management theory emerged in the 20th century. One of the first management gurus was Frederick Winslow Taylor. Taylor wanted to prove that "the best management is a true science, resting upon clearly defined laws." He called this scientific management. His groundbreaking book, "The Principles of Scientific Management," was the first business bestseller, and it swept through corporate America in the early 1900s. Much of management thinking since has been either a further development of Taylor's ideas or a counter reaction to them.
Taylor was born to a wealthy Quaker family in Philadelphia in 1856 and died in 1915. He lived during a time when the northeast region of the United States was undergoing rapid industrialization. This industrialization was being fed by massive movements of labor from the farm fields to the factory floors.
At the time, factories were run by the family members that owned them or by their friends. Factory managers had little formal training in managing organizations, and they had little contact with their workers. Unions controlled the factory floor, and memberships in unions were largely restricted to sons or relatives of union members. There were no standards for production, little coordination between worker groups, and no systematic training programs.
In 1875, Taylor started work as an apprentice machinist for a pump manufacturing company. At the time, apprenticeships in factories were the business schools in America for wealthy young men who were going to run companies. After his four-year apprenticeship, Taylor began work as a machinist at Midvale Steel Works. He rose rapidly through the ranks to become the chief engineer thanks to his pioneering work in worker productivity and his family's relationship with an owner of the company.
Taylor recognized that many workers were not working as hard as they could, and this resulted in higher labor costs for the company. He came to believe that workers could be motivated by money. If a worker wanted more money, he should increase his daily output. This led Taylor to favor a piece-rate system in which workers were paid for their output rather than for their time on the job.
Taylor believed that for management and workers to both prosper, production control must be transferred from workers to management. Managers should give workers clear instructions on how to efficiently perform their jobs, and then monitor their performance to see if they were achieving high production targets. Also, managers should seek to hire those who were motivated to produce quickly and efficiently.
Taylor wanted to know how much output should be expected from the workers. He walked around the factory with a stopwatch and a notepad and broke down work tasks into a series of components that could be timed. His most famous study involved shovels. Taylor convinced workers, whose compensation was tied to how much they produce, to use shovels that were sized to pick up an optimal amount. He further recommended better ways to make shoveling movements. Studies like the shoveling study became known as time-and-motion studies, and these studies are still used today.
In 1890, Taylor became a general manager of an investment firm and a few years later started the first industrial management consultancy. He worked with Bethlehem Steel Corp. where he implemented a planning system that produced real-time analyses of production output and costs. He also developed a way to harden the steel used to make tools, and this made him a wealthy man.
Taylor's book was translated into many languages, which resulted in scientific management spreading throughout the world. After a bloody revolution in Russia in 1917, Vladimir Lenin read about scientific management and thought he could use its ideas to industrialize the country. He set up numerous education programs and factory experiments with the goal of organizing production, raising labor productivity and instilling discipline in the workforce. Many of Taylor's ideas were not implemented because Russians were suspicious of an American capitalist sabotaging Lenin's socialist efforts.
In France, Taylor's book influenced Henri Fayol, a French engineer who founded the administrative theory of management. Fayol believed in a top-down, command-and-control style in which managers plan, organize, oversee, coordinate and ensure compliance. Fayol's style differed from Taylor, whose bottom-up approach started with maximizing the efficiency of workers and then looked for ways to make management more efficient.
In Germany, Max Weber, a German sociologist, thought that large organizations should be like government bureaucracies. These organizations needed clear lines of authority, clear rules of governing performance and standard guidelines for management practices such as hiring and firing. Weber argued that a bureaucratic organizational structure eliminated the practice of those with power from favoring their relatives or friends in hiring. Large organizations should be built on the skills employees develop through education or experience.
The overlapping ideas of Taylor, Fayol and Weber formed the foundations of classical management theory in the early 1900s. Over the remaining years of the last century, other management ideas that differ from those in classical management emerged. You can find those ideas in the business books lined up on library and bookstore shelves.