Classification of Management Thoughts in Five Schools of Management Theory!
With the beginning of this century, the discipline (subject) of management has assumed greater significance.
Not only had the practitioners/businessmen, but also the academicians begun to show extraordinary interest in this subject.
This resulted in the development of a number of approaches to its study. The different approaches developed by various thinkers have led to a kind of confusion as to what management is, what management theory and science are, and how it should be studied? Harold Koontz has correctly called the situation as “the management theory jungle”.
Harold Koonti, therefore, has tried to cross through jungle and to classify the various approaches into schools of management theory. His work has been supplemented by scholars such as John F. Mee, Joseph A. Litterer, W.W. Cooper and others.
Based on the writings of these and other thinkers we have made an attempt to classify management thought in five schools of management theory:
1. The Operational (Management Process) School.
2. The Empirical School.
3. The Human Relations or Human Behaviour School.
4. The Social Systems School.
5. The Decision Theory School.
These schools of thought are discussed below:
1. The Operational (Management Process) School:
The exponents of this school concede that the primary function of management is to get things done with and through people as individuals and as members of work groups. That is why; this school is known as Operational School. It views management as a universally applicable body of knowledge and theory applicable to all types and levels of organizations.
This school aims at finding out the main functions of the managers and to classify them into basic principles of management practice. This school attempts to analyse intellectually the nature, purpose, structure and the underlying process of each of the functions of management. The essence of this approach, therefore, lies in the analysis of the process of management.
This school of management thought was propounded by the noted French management thinker and practitioner, Henry Fayol. A contemporary of Taylor, Fayol for the first time attempted a systematic analysis of the overall management process. His ideas on management have been referred as the Administrative Management Theory, which later evolved into the Management Process School.
This approach is also known as the “Traditional Approach”, “Universalist Approach”, and “The Classicist Approach.”
Harold Koontz says that this approach bases its analysis on the following fundamental beliefs:
(i) Management is an operational process which can be divided into various functions.
(ii) Experience can furnish grounds for distillation of theory and principles. It can also help to improve the practice.
(iii) The principles of management can be tested through research and experiment to find their validity and improve their applicability.
(iv) Management is an art but like medicine or engineering, it relies on its principles.
(v) Management principles shall never become untrue even if a practitioner ignores them in a given situation.
(vi) Manager’s job may be affected by varied environmental factors. But the management science need not cover all the fields of knowledge in order to serve as a foundation of management practice.
This school has been criticized on the grounds that (a) it is losing its validity for want of any significant contribution after Hemy Fayol’s contribution at the end of the 19th century; (b) The so called universal principles of management have, on various occasions, failed to stand the test of empirical scrutiny ; (c) Since organizations function under dynamic conditions, searching for universal principles may not always prove to be a full-proof exercise.
Despite all this criticism this School has certainly provided a concept on framework which can be beneficially utilized to identify the essentials of management.
2. The Empirical School:
It is also named as the management by customs school. The pioneers who have contributed to this school of thought maintain that management is a study of the past experience of managers. The important contributors associated with this school are Earnest Dale, the researchers from Harvard Business School and the Management Associations in different countries, more notably the American Management Association.
According to them (a) Management is the study of experience ; (b) the managerial experience can be gainfully utilized by passing it over to the practioneers, students, etc. and also for drawing generalizations on management activities ; (c) the success and the failure of management in the process of decision making can provide a fruitful guidance to the manager in a similar situation that may arise in future, i.e., case studies in management prove useful in training future managers and (d) any theoretical research shall be based on practical experience.
Thus the empirical schools of thought depends heavily on the precedents connected with the managerial situations handled by the managers and their own experience on the ground that research and thought evolved in the course of study is sure to help in ready verifications of principles.
Since this approach lays emphasis on case studies of management, it is also known as “Case Study Approach”. By analyzing cases, certain generalizations can be drawn and can be applied as useful guides for future thought or action.
Defects of Empirical Approach:
The orientation of this approach towards past is regarded as its main defect. Critics feel that a manager has to work under dynamic conditions and that history does not repeat itself. There may be a great contrast between the situations of the past and those of the present.
Harold Koontz opines that “Management unlike law is not a science based on precedents and situations in the future exactly comparable to the past are exceedingly unlikely to occur. There is positive danger in relying too much on past experience and on undistilled history of managerial problem solving for the simple reason that the technique or approach found right in the past may not fit into a situation of the future”.
Management is not an exact science based on precedents. Further, past situations may not occur in the same pattern and the techniques evolved to solve the problems of the past may prove irrelevant to the situations of the Future.
Moreover, learning of management through experience is a time consuming process and top-level executives have neither patience nor time to learn about the management in this fashion. Finally, this approach altogether discards the theoretical aspects of management.
3. The Human Behaviour School:
Elton Mayo, the director of the “Hawthorne Studies” is the proponent of this school of thought.
Human behaviour school considers the behaviour of human beings as the focal point of the management action. It does not view management strictly as a technical process. Based on its objectives and scientific research of individual behaviour and motivation, it was established that the relationship between morale and productivity had been over-simplified by human relationlists.
The Behaviour Science approach to management laid more stress on the application of the methods and findings of general social psychology and sociology for understanding the organisational behaviour. Behaviour Science Movement is regarded as a further refinement of human relations movement. It covered much wider aspects in interpersonal roles and relationships.
With its major emphasis on human relations, informal groups, communication, employee motivation and leadership styles, the behaviour approach to management has drawn attention to a wide range of socio-psychological phenomena like the dynamics of organisational behaviour, group dynamics, organisational conflict, change and techniques of organisational development.
This approach is, therefore, also known as “Human Relations Approach” or “Behavioural Science Approach”. As this approach views the manager as a “Leader” and treats all “Lead” activities as managerial activities, it is also called as “Leadership Approach.”
The following are the important aspects of the behavioural science approach:
(i) Employee Motivation:
This includes a determination of the factors that lead to high productivity and high morale.
(ii) Organisation as a social system:
It includes studies of role, status symbol as well as the functions of informal groups.
This school also underlines the role of personal leadership in management. The scope of this school includes study of human relations and how the manager can grasp their implications, study of manager as a leader and the way he should lead and study of group dynamics and interpersonal relationships. It involves the study of successful and unsuccessful managerial behaviour.
It includes the study of factors relating to achieving understanding among persons in an organisation as a consideration of the best structuring and use of the channels of contract in an organisation.
(v) Employee Development:
It is concerned with the continued upgrading of employee skills and managerial skills.
This new thinking in management started with the development of need hierarchy by Abraham Maslow in 1940, followed by the works of Frederick Herzberg, Douglas Mcgregor and Kemis Likert. Research during this period has provided sufficient evidence that human element is the key factor in the success or failure of an organisation.
Job enlargement, participation of employees in decision-making process and development of an organisational climate more conducive to the satisfaction of human needs, less reliance on the use of formal authority, and changes in the traditional methods of supervision and control are the tools suggested by the contributors of this era for increasing the productivity of the human beings.
Defects of Human Behaviour Approach:
Like other approaches, the human behaviour approach also has its own defects. This approach leans heavily on individual psychology. It goes too far in insisting that people need to be made happy so that the organisation can function effectively.
4. The Social System School:
The generalisation of this school of thought is heavily oriented to sociological concepts. This school believes that the theory of management rests on the understanding of the interaction of social groups. This school is closely related to the Human Behaviour School of management. “This includes those researches that look upon management as a social system that is system of cultural inter-relationships.
Sometimes, as in the case of March and Simon, the system is limited to formal organisation, using the term ‘Organisation’ as equivalent to enterprise rather than the authority activity concept used most often in management. In other cases, the approach is not to distinguish the formal organisation but rather to encompass any kind of system of human relationship.”
Chester Barnard is considered as the father of social system school. He examined the inter-relationships within the organisation. He developed his concept .of Formal Organisation. It is regarded to be a major contribution in the field of management. He visualized management as a co-operative system where persons are able to communicate with each other and who are willing to contribute effectively towards a conscious common goal.
He started with the individual, moved to cooperative organised endeavour, and ended with the executive functions. His publication ‘The functions of the Executive’ (1938) is a significant work. The other exponents of this school of thought are Max Weber, Maslow, Argyris, March and Simon, Herzberg and Likert.
The main thrust of the social system is to study different aspects of social systems. For the contributors of this school (i) organisation is essentially a cultural system composed of groups of people who work in co-operation (ii) complete cooperation among the members as well as the groups is very necessary for achieving the goals of the organisation (iii) All the efforts of the management should aim at the establishment of harmony between the goals of the organisation and goals of the groups and the individual members, and (iv) the existence of relationship between internal as well as external environments and change can be easily identified.
Even though this school has made valuable contribution in the field of management still, critics feel that (i) Sociology is one of the important tools required to understand the organisation as a social entity and the different types of cultural pressures and conditions under which this social system has to work and (ii) it cannot do justice to many other aspects of the working of an organisation including the technological factors and the factors connected with the psychological behaviour of the people which is, in turn, connected with the organisation, whether they are individuals or groups.
As observed by Koontz, this approach is, broader than management and in practice it tends to overlook many important concepts and techniques of management.
5. The Decision Theory School:
The exponents of this school led by Simon concentrate their attention fully on decision-making. They are of the view that all the managerial functions boil down to one point that is decision-making; Decisions are taken through rational choice among different alternatives within the given constraints. The school’s stress is on the study of alternatives through right assessment of different variables.
“This group concentrates on rational approach to decision … the selection from among possible alternatives of a course of action or of an idea. The approach of this school may be to deal with the decision itself or with the persons or organizational group making the decision or with an analysis of the decision process.
Some alternatives are regarded to be fairly large to the economic rationale of decision, while others regard anything which happens in an enterprise the subject of their analysis, and still others expand decision theory to cover the psychological and sociological aspects and environment of decisions and decision makers.”
The exponents of these schools go for beyond decision making and they cover almost the entire range of human activities in an organization as well as the macro conditions within which the organisation functions.
They have expanded their area of theory building from the decision making process to the study of the decision maker. The decision theorists start with the small area of decision making and then look at the entire field of management through this keyhole.
This school is heavily oriented to model building and different mathematical tools and techniques. A wide range of mathematical and rational research tools and techniques have been used for taking decisions with regard to the great variety of problems that management faces, such as work study, work flow, inventory control, incentives, marketing, communication, planning and information system etc.
The methods of decision making also have undergone radical changes from the past. Several new concepts and approaches have been developed in the field of decision making. For example, the concept of sub-optimization, marginal decisions and “muddling throw are some of the major developments in the field of decision making. Slowly and gradually the superficial methods of decision making are giving way to real situation-oriented approaches to management.
The advocates of this school contemplate that the future development of management discipline will revolve round the decision-making. Thus, in their view, the entire field of management is covered by this school.
Notes on general review of management of schools:
From the foregoing description of various schools of management thought, it is quite clear that some of schools overlap each other. Management is no longer the restricted domain of managers and entrepreneurs. Different disciplines have contributed to the growth of managerial thought. As a result of these diverse contributions, management has grown as a discipline. Some of the approaches take only partial view of the area of management and see the managerial problems through coloured glasses. This is owing to the fact that the exponents of particular schools have a tendency to stress the concepts as developed in their parent disciplines.
This exclusiveness has blurred their vision and they take part or parts to be the whole. They do not attempt to see that management is an inter-disciplinary subject which draws heavily on the knowledge developed in different disciplines.
Inspite of this fact management has established itself as an independent discipline. Managerial problems cannot be viewed only from one exclusive angle which the advocates of different schools have attempted to do.
Various approaches to management theory and exclusiveness of theories have created confusion. Different intellectual cults have developed. Prof. Koontz has called this phenomenon as, “The Management Theory Jungle.” He has suggested for taking fresh look on different schools of thought in management and finding the possibility of evolving a unified theory of management.
In his opinion “the different approaches of management were not different schools of management, but are a kind on intellectual division of level in studying the problems of managing.” With a view to disintegrating the management theory jungle, it is essential that the area of management should be clearly defined.
It should have a specific area of study. A proper distinction should be made between the subject-matter of management and the tools of analysis of different subjects, which are not a part of management discipline. The contributions of other disciplines should not make management a part of those disciplines. Management should be integrated with other disciplines but it should not lose its specific identity.