Evolution of management thought: Taylor's scientific management and Fayol's principles

1. The stages of management thought

1. Pre-scientific period (before about 1880): management by rule of thumb. Robert Owen’s welfare measures at New Lanark and Charles Babbage’s writing on division of labour are the early names.
2. Classical theory (about 1880–1930): three strands — scientific management (Taylor, with Frank and Lillian Gilbreth and Henry Gantt), administrative or process management (Fayol, Gulick, Urwick) and bureaucracy (Max Weber).
3. Neo-classical or human relations theory (1930s onwards): Elton Mayo and the Hawthorne experiments, then the behavioural school (Maslow, McGregor, Herzberg).
4. Modern theories (1950s onwards): the quantitative school, systems approach, contingency approach, and Peter Drucker’s writing on management by objectives.

2. Frederick Winslow Taylor (1856–1915)

Taylor was an American engineer who rose from labourer to chief engineer at the Midvale Steel Company and later worked at Bethlehem Steel. He is called the father of scientific management. His main works are Shop Management (1903) and The Principles of Scientific Management (1911). He saw that output was low because workers deliberately restricted it (“soldiering”) and because methods were fixed by habit rather than study.

Principles

1. Science, not rule of thumb. Every element of a job should be studied scientifically to find the one best way.
2. Harmony, not discord. Managers and workers should see that their interests are the same.
3. Co-operation, not individualism. Work and responsibility are divided almost equally between management and workers.
4. Maximum output in place of restricted output.
5. Development of each worker to his greatest efficiency and prosperity, through scientific selection and training.

Techniques

• Time study: fixing the standard time for each operation with a stop watch.
• Motion study: removing unnecessary movements (developed further by the Gilbreths).
• Fatigue study: fixing rest pauses.
• Method study and standardisation of tools, materials and working conditions.
• Functional foremanship: in place of one foreman, eight specialists. Four sit in the planning department (route clerk, instruction card clerk, time and cost clerk, shop disciplinarian) and four on the shop floor (gang boss, speed boss, repair boss, inspector).
• Differential piece-rate system: a higher rate per piece for workers who reach the standard, a lower rate for those who do not.
• Mental revolution: Taylor said scientific management was above all a change of attitude on both sides, from quarrelling over the division of the surplus to increasing the surplus.

His best-known experiment was at Bethlehem Steel, where a pig-iron handler’s daily loading was raised from about 12.5 tons to 47.5 tons by scientific selection, training and rest pauses, with a higher wage.

Criticism

• Workers said it led to speeding up, monotony, unemployment and the reduction of the worker to a machine; it ignored the human side.
• Employers objected to the heavy cost of planning departments and studies.
• Functional foremanship breaks unity of command: a worker answers to eight bosses.
• The differential rate was seen as harsh on slower workers.

3. Henri Fayol (1841–1925)

Fayol was a French mining engineer who became managing director of the Commentry-Fourchambault mining company and turned it round. His book Administration Industrielle et Générale (1916) was translated into English as General and Industrial Management (1949). He is called the father of modern (administrative) management theory.

Six groups of activities in any enterprise: technical, commercial, financial, security, accounting and managerial. Five elements of the managerial activity: planning (forecasting), organising, commanding, co-ordinating and controlling.

The fourteen principles

1. Division of work — specialisation increases output.
2. Authority and responsibility — they go together; authority without responsibility leads to misuse, responsibility without authority to failure.
3. Discipline — obedience to agreements and rules, enforced by good superiors and fair penalties.
4. Unity of command — each employee receives orders from one superior only.
5. Unity of direction — one head and one plan for a group of activities with the same objective.
6. Subordination of individual interest to general interest.
7. Remuneration — fair, and satisfactory to both employer and employee.
8. Centralisation — the right degree depends on the circumstances.
9. Scalar chain — the line of authority from top to bottom; Fayol allowed a “gang plank” for direct contact between people at the same level, with their superiors’ consent, to avoid delay.
10. Order — a place for everything and everyone, and everything and everyone in its place.
11. Equity — kindness and justice in dealing with employees.
12. Stability of tenure of personnel — high turnover is costly.
13. Initiative — employees should be encouraged to propose and carry out plans.
14. Esprit de corps — union is strength; build team spirit.

4. Taylor and Fayol compared

The two are complementary. Taylor improved the efficiency of operations; Fayol supplied a framework for running the organisation. Together they form the classical school.

How this is examined

Both appear in Unit I of the 80-mark papers. August 2024 set “Explain the major contributions of Henry Fayol to management” for 10 marks and “Explain Taylor’s scientific management” for 6; April 2023 set “Briefly explain the 14 principles of management given by Henry Fayol” for 10. A 10-mark answer on Fayol should give his background and book, the six activities and five elements, and all fourteen principles with one line of explanation each. On Taylor, give the principles, at least four techniques with functional foremanship explained, and the criticism. A 6-mark short note on either should give the dates, the main work, and five principles.