Page 33 - DMGT402_MANAGEMENT_PRACTICES_AND_ORGANIZATIONAL_BEHAVIOUR

Management Practices and Organisational Behaviour

Notes management thoughts. He should also be aware of the different methods that have been tested
and found suitable for use in modern workplace.
There have been three phases in the development of management thought. First, there is the
classical approach which stressed on the production and administrative process within
organisations. Second, there is the neo-classical approach that stressed on the importance of
establishing and maintaining sound practices in human relations. This approach sees this as a
means of improving the management process, and, of course, those who stress the importance
of human relations in the organisation are concerned primarily with the human element in
management. Finally, there are several modern approaches to the study of management that
stress on either the social system, the decision making process, a systems approach, or the
application of quantitative methods. In this unit, we will discuss the gradual development of the
management theory in detail.

2.1 The Classical Management Theory

The term “classical” in English language refers to something traditionally accepted or long
established. The beginning of the classical organisation theory can be traced back to the heydays
of industrial transformation in the second half of the nineteenth century when some perceptive
observers felt obsessed with the problem of growing size of the industries. In the beginning, the
large scale operations were carried out by the organisations with the help of unskilled and semi-
skilled labour but later on, the technological development changed the industrial scene
completely. Many new economic, social and technical problems sprang up. The need for solving
these problems called for the development of organisational forms and management practices
which were quite different from the traditional ones. This phenomenon changed the
individualistic nature of organisation and management into mechanical nature. This view was
current till the first half of the twentieth century.
The classical writers viewed the organisation as a machine and human beings as different
components of that machine. Their approach has focused on input-output mediators and given
less attention to constraining and facilitating factors in external environment. Workers were
considered to be driven by economic considerations who could be solely motivated by economic
rewards. On the other hand, managers were regarded as kind-hearted, rational, intelligent and
qualified people. Because an organisation was treated as a machine, it was felt that its efficiency
could be increased by making each individual efficient, so that both the organisation’s and the
workers’ interests might be served. Increased human productivity would facilitate the organisation
in achieving its goals and objectives while on the other hand workers would get higher wages
in return for their increased productivity. Thus, management is to emphasise on the
improvement of machine in order to get higher productivity from the people at the minimum
expense. The emphasis was on specialisation of performance and co-ordination of various
activities.

2.1.1 Assumptions of the Classical Theory

The classical theory was based on the following assumptions:

1. The relationship between workers and management was established through formal
communications, defined tasks and accountability and formalised procedures and practices
to minimise conflict between them.
2. Workers are considered to be driven by economic considerations who can be motivated
basically by economic rewards. Money is considered the main motivator.
3. The managers were characterised as rational, kind-hearted, intelligent and qualified
personnel but they are supposed to deal with the workers firmly in the system.

28 LOVELY PROFESSIONAL UNIVERSITY