Classical & Human Relations Schools of Management: A Comparative Analysis

Posted on Nov 22, 2024 in Economy

Classical School of Management

Scientific Management (Taylor)

Idea: Increasing productivity through improved operator efficiency by scientifically studying labor productivity incentives. Man is seen as an appendage of the machine.

Key Aspects:

  1. Emphasis on efficiency
  2. Division and functional specialization of labor
  3. Specialized middle management supervision
  4. Limited authority and responsibility
  5. Incentive systems

Four Principles:

  1. Replacing practical rules with scientific precepts
  2. Obtaining harmony rather than discord
  3. Cooperation instead of individualism
  4. Scientific selection, education, and development of workers

Administrative Theory (Fayol)

Idea: Increased efficiency through optimized form and components, focusing on administrative provisions and structure.

Five Functions of Management:

  1. Forecasting change
  2. Organizing resources for each sub-function
  3. Directing strategies
  4. Coordinating objectives through supervision
  5. Controlling

Fourteen Principles of Management:

  1. Division of work
  2. Authority and responsibility
  3. Discipline
  4. Unity of command
  5. Unity of direction
  6. General interest over individual interest
  7. Fair staff remuneration
  8. Delegation vs. centralization
  9. Hierarchies
  10. Order
  11. Equity
  12. Staff stability
  13. Initiative
  14. Team spirit (esprit de corps)

Criticisms:

  1. Simplistic organizational approaches
  2. Strong centralization
  3. Neglect of the informal organization
  4. Closed rational vision
  5. Excessive rigidity
  6. Waste of talent, encouraging alienation and lack of commitment

Bureaucratic School (Weber)

Key Elements: Centralized authority and power, creating an efficient but slow organizational form. Emphasis on organizational design.

Ideal Bureaucracy Characteristics:

  1. Standardized behavior
  2. Division of labor and specialization
  3. Hierarchy of authority
  4. Formalization
  5. Procedures and rules
  6. Trained personnel
  7. Separation between ownership and management, with fixed wages

Bureaucratic Goals:

  1. Predictable human behavior
  2. Standardized tasks

Expected Results: Increased efficiency and productivity, fairness, and transparency of decisions.

Unforeseen Results: Lack of motivation, impersonal atmosphere, excessive red tape, inefficiency, and rigidity.

Criticisms: Excessive formality and routine, neglect of the informal organization and individual personality, and a mechanistic conception of work.

Human Relations School (Elton Mayo)

Originated from the shortcomings of the classical schools, addressing the dehumanization of work, influenced by:

  1. Development of industrial psychology and sociology
  2. Skilled labor
  3. Growth of enterprises
  4. Experimental results
  5. Personal relationships, trust, informal groups, democratic leadership, and job satisfaction leading to increased productivity

Contributions Against the Classical School: Decentralized decision-making, consideration of group motivation, less authoritarian supervision, greater emphasis on external scrutiny than accountability, worker participation, motivation theory, and social and technical skills.

Criticisms: Understatement of technical factors, closed system view, lack of understanding of conflict, paternalistic approach, and little consideration of unions.

McGregor’s Theories

Theory X (Tayloristic):

Humans are averse to work, avoid responsibility, and are primarily motivated by economic means.

Theory Y (McGregor):

Humans desire self-improvement, are responsible for goals, and are motivated by responsible jobs.

Strategy

Components: Scope, distinctive capabilities, competitive advantages (cost, differentiation), and synergy.

Growth Strategies: Specialization or diversification (horizontal, vertical, or relational), internationalization, and growth methods (internal, external, or hybrid).

Competitive Strategy: Cost leadership or differentiation.

Just In Time (JIT)

Principles: Reduction of manufacturing time, zero defects, breakdowns, paperwork, stocks, and deadlines; reusability; flexible machines; specialized production; Kanban system; good worker treatment; worker autonomy and flexibility; U-shaped work cells; versatile workers; few suppliers for greater commitment and stability; defect control; and machine maintenance by workers.

Advantages: Reduced production costs and increased quality, reduced inventory levels, shorter manufacturing cycles, improved internal communication, promoted teamwork, and problem-solving in the manufacturing process.