1. The Evolution of Management TheoryThe Evolution of Management Theory

2. Learning ObjectivesLearning Objectives
To understand how management theories
develop
To understand the impact of the environment to
management thinking
To gain insights into new management approach

3. Early Management ThoughtEarly Management Thought
Early ideas about management strategy
Sun Tzu (770-476 B.C.), The Art of War
Early ideas about leadership
Nicolò Machiavelli (1469-1527), The Prince
Early ideas about the design and organization
of work
Adam Smith, The Wealth of Nations
• division of labor

4. Sun Tzu, Art of WarSun Tzu, Art of War
“Shang Chang Ru Zhan Chang”
“The marketplace is a battlefield”
Sun Tzu, 4th
century BC

5. Management and MachiavelliManagement and Machiavelli
New science of management
lies in the the old art of
government
"to be a great pretender and
dissembler."
“cunning and intrigue, the
triumph of force over reason.”
"a prince" ought to have no
other aim or thought, nor select
anything else for his study,
than war and its rules and
discipline."

6. The Evolution of Management TheoryThe Evolution of Management Theory
(Comprehensive Analysis of Management)
Systems Theory
Contingency Approach

7. Management ApproachesManagement Approaches
and the Environmentand the Environment
GENERAL
ENVIRONMENT
OPERATING
ENVIRONMENT
INTERNAL
ENVIRONMENT
SOCIAL
ECONOMIC
POLITICAL
LEGAL
TECHNOLOGY
NEW ENTRANTS
SUPPLIER
SUBSTITUTES
CUSTOMER
COMPETITION
PRODUCTION
TECHNOLOGY
STRUCTURE
INPUTS

8. The Classical ApproachThe Classical Approach
Environment in ca1890
•Industrial revolution
•Autocratic management was the norm
•“Science" as a solution to the inefficiencies
and injustices of the period
•Idea of interchangeable parts
The classical approach (ca1890) to
management is a management approach that
emphasizes organizational efficiency to
increase organizational success.

9. The Classical ApproachThe Classical Approach
Scientific Management
Frederick W. Taylor
Frank and Lillian Gilbreth
Henry Gantt
Bureaucratic Management
Max Weber
Administrative Management
Henri Fayol

10. Taylor’s Four Principles of Scientific ManagementTaylor’s Four Principles of Scientific Management
1. Scientifically study each part of a task and
develop the best method of performing the
task.
2. Carefully select workers and train them to
perform the task by using the scientifically
developed method.
3. Cooperate fully with workers to ensure that
they use the proper method.
4. Divide work and responsibility so that
management is responsible for planning
work methods using scientific principles and
workers are responsible for executing the
work accordingly.

11. ““Now one of the first requirements forNow one of the first requirements for
a man who is fit to handle pig iron as aa man who is fit to handle pig iron as a
regular occupation is that he shall beregular occupation is that he shall be
so stupid and so phlegmatic that heso stupid and so phlegmatic that he
more nearly resembles in his mentalmore nearly resembles in his mental
makeup the ox than any other type”makeup the ox than any other type”
- Frederick Taylor- Frederick Taylor
““Now one of the first requirements forNow one of the first requirements for
a man who is fit to handle pig iron as aa man who is fit to handle pig iron as a
regular occupation is that he shall beregular occupation is that he shall be
so stupid and so phlegmatic that heso stupid and so phlegmatic that he
more nearly resembles in his mentalmore nearly resembles in his mental
makeup the ox than any other type”makeup the ox than any other type”
- Frederick Taylor- Frederick Taylor

12. Key Characteristics of Weber’s Ideal BureaucracyKey Characteristics of Weber’s Ideal Bureaucracy
Specialization of labor
Formal rules and procedures
Impersonality
Well-defined hierarchy
Career advancement based on merit

13. Fayol’s 14 Principles ofFayol’s 14 Principles of
Administrative ManagementAdministrative Management
1. Division of work
2. Authority
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination of
individual interest to
the general interest
7. Remuneration
8. Centralization
9. Scalar chain
10. Order
11. Equity
12. Stability and
tenure
13. Initiative
14. Esprit de corps
Planning, Organizing, Commanding, Coordinating, Controlling

14. What are the limitations of theWhat are the limitations of the
Classical Approach??Classical Approach??

15. The Behavioral ApproachThe Behavioral Approach
The behavioral approach (ca 1910) to
management is a management approach that
emphasizes increasing organizational
success by focusing on human variables
within the organization.
Environment in ca1910
•The Newtonian science that supported "the one best way" of
doing things was being strongly challenged by the "new
physics" results of Rutherford and Einstein
•In the work place there were strong pressures for shorter
hours and employee stock ownership.
•As the effects of the 1929 stock market crash and following
depression were felt, employee unions started to form

16. Behavioral PerspectiveBehavioral Perspective
The Hawthorne Studies
Human Relations
Approach
Employee motivation
• Abraham Maslow
Leadership style
• Douglas McGregor

17. Hawthorne Effect:Hawthorne Effect:
The discovery that paying specialThe discovery that paying special
attention to employees motivates themattention to employees motivates them
to put greater effort into their jobs.to put greater effort into their jobs.
(from the Hawthorne management studies,(from the Hawthorne management studies,
performed from 1924 – 1932 at Western Electricperformed from 1924 – 1932 at Western Electric
Company’s plant near Chicago)Company’s plant near Chicago)

18. Physical NeedsPhysical Needs
Need for SecurityNeed for Security
Need for Social RelationsNeed for Social Relations
Need for Self EsteemNeed for Self Esteem
Self-ActualizationSelf-Actualization
Maslow’s Hierarchy ofMaslow’s Hierarchy of
NeedsNeeds

19. McGregor’s Theory X and Theory YMcGregor’s Theory X and Theory Y
Leaders and managers who hold Theory X assumptions
believe that employees are inherently lazy and lack
ambition.
A negative perspective on human behavior.
Leaders and managers who hold Theory Y assumptions
believe that most employees do not dislike work and
want to make useful contributions to the organization.
A positive perspective on human behavior.

20. What are the limitations of theWhat are the limitations of the
behavioral approach?behavioral approach?

21. The Management Science ApproachThe Management Science Approach
The management science approach (ca1940)
is a management approach that emphasizes
the use of the scientific method and
quantitative techniques to increase
organizational success.
Environment in ca1940
•Application of OR in solving complex problems in
warfare (WWII)
•Significant technological and tactical
breakthroughs
•Interest in manufacturing and selling after WWII

22. The System ApproachThe System Approach
The system approach (ca 50’s-60’s) to
management is a management approach
based on general system theory--the theory
that to understand fully the operation of an
entity, the entity must be viewed as a system.
This requires understanding the
interdependence of its parts.
Environment in ca1950’s to 60’s”
•Growing quality consciousness
•Total Quality Management

23. The Open Management SystemThe Open Management System
GENERAL
ENVIRONMENT
OPERATING
ENVIRONMENT
SOCIAL
ECONOMIC
POLITICAL
LEGAL
TECHNOLOGY
NEW ENTRANTS
SUPPLIER
SUBSTITUTES
CUSTOMER
COMPETITION
PLANNING, ORGANIZING,
INFLUENCING, CONTROLLING
INPUT  PROCESS OUTPUT

24. The Contingency ApproachThe Contingency Approach
The contingency approach (ca 70’s) to
Management is a management approach that
Emphasizes that what managers do in
practice depends on a given set of
circumstances--a situation.
Environment in ca1970’s”
•Emergence of new companies “Apple”
•Emergence of new products, “IBM PC”

25. Triangular ManagementTriangular Management
Triangular management is a management
approach that emphasizes using information
from the classical, behavioral, and manage-
ment science schools of thought to manage
the open management system.

26. TriangularTriangular
Management ModelManagement Model
BEHAVIORALLY BASED INFORMATION
CLASSICALLY
BASED
INFORMATION
MANAGEM
ENT
SCIENCE-BASED
INFORM
ATION
GENERAL
ENVIRONMENT
OPERATING
ENVIRONMENT
SOCIAL ECONOMIC
POLITICAL
LEGAL
TECHNOLOGY
NEW ENTRANTS
SUPPLIER
SUBSTITUTES
CUSTOMER
COMPETITION
PLANNING, ORGANIZING,
INFLUENCING, CONTROLLING
INPUT  PROCESS OUTPUT
GENERAL
ENVIRONMENT
OPERATING
ENVIRONMENT
SOCIAL ECONOMIC
POLITICAL
LEGAL
TECHNOLOGY
NEW ENTRANTS
SUPPLIER
SUBSTITUTES
CUSTOMER
COMPETITION
PLANNING, ORGANIZING,
INFLUENCING, CONTROLLING
INPUT  PROCESS OUTPUT

27. Type Z OrganizationType Z Organization
(Theory Z by Ouchi 1981)(Theory Z by Ouchi 1981)
Theory Z (ca 80’s) suggests that involved workers
are the key to an increase in productivity and it
offers offers ways to manage (collective decision
making, slow evaluation and promotion, and
holistic concern for people) so that they can work
together more effectively.
Environment in ca1980’s
•Slow American productivity improvement
•Rise of Japanese companies
•Japanese management may offer solutions to this
problem

28. Theory ZTheory Z
“Involved workers are the key to an increase in
productivity.”
From “Theory Z” by William Ouchi, 1981

29. Chaordic Organization (Chaos Theory)Chaordic Organization (Chaos Theory)
(Hock, Dee,1999)(Hock, Dee,1999)
Chaos theory (ca 90’s) in management
recognizes that events indeed are rarely
controlled. Blending chaos with order
Environment in ca1990’s
•Start of Internet age
•Highly competitive environment
•Emergence of communications technologies
•Emergence of new work practices (virtual teams,
network organizations)

30. Chaordic OrganizationsChaordic Organizations
Purpose
Principles, People, and Concept
Structure and Practice
• Clarity of purpose and
shared values
•Operate through
network of equals, not
hierarchies
From “Birth of the Chaordic Age” by Hock, D. 1999

31. How about Modern ManagementHow about Modern Management
Approach?Approach?

32. Environment In the New MillenniumEnvironment In the New Millennium
Environment in the millenium
•Information and electronic age
•Information and knowledge is going to be readily
available to us all
•Information speed through Internet
•The future is going to be dominated by our need to
understand systems.

33. The Learning Organization ApproachThe Learning Organization Approach
The learning organization approach to
management is the management approach
based on an organization anticipating
change faster than its counterparts to have
an advantage in the market over its
competitors.
From “The Fifth Discipline” by Peter Senge, 1990

34. Managerial Approach to LearningManagerial Approach to Learning
OrganizationOrganization
Managers must create an environment conducive to
learning
Managers encourage the exchange or information
among organization members
Managers promote
systematic problem solving
Experimentation
learning from experiences and past history
learning from experience of others
transferring knowledge rapidly throughout the organization
From “The Fifth Discipline” by Peter Senge, 1990

35. Building a Learning OrganizationBuilding a Learning Organization
System Thinking
Every organization member understands his or her own job and
how the jobs fit together to provide finals products to the
customer
Shared vision
All organization members have a common view of the purpose
of the organization and a sincere commitment to accomplish the
purpose
Challenging of the mental models
Organization members routinely challenge the the way business
is done and the thought processes people use to solve
organizational problems
From “The Fifth Discipline” by Peter Senge, 1990

36. Building a Learning OrganizationBuilding a Learning Organization
Team learning
Organization members work together, develop solution to new
problems together, and apply the solutions together.
Working as teams rather than than individuals will help the
organization gather collective force to achieve organizational
goals
Personal mastery
All organization members are committed to gaining a deep and
rich understanding of their work
Such an understanding will help organizations to reach important
challenges that confront them
From “The Fifth Discipline” by Peter Senge, 1990

37. Building aBuilding a
LearningLearning
OrganizationOrganization
System thinkingSystem thinking
Personal masteryPersonal mastery
Team LearningTeam Learning
Learning Organization ApproachLearning Organization Approach
Shared VisionShared Vision
Challenging ofChallenging of
Mental modelsMental models
(Systems Approach)
(Chaordic Organization)
(Classical/Management
science)
(Theory Z/Behavioral)
(Theory Z/Behavioral)

38. Business Process Management ApproachBusiness Process Management Approach
The business process management approach to management
is a method of efficiently aligning an organization with the
wants and needs of clients. It is a holistic management
approach that promotes business effectiveness and efficiency
while striving for innovation, flexibility and integration with
technology. As organizations strive for attainment of their
objectives, BPM attempts to continuously improve processes -
the process to define, measure and improve your processes –
a ‘process optimization' process.
This is actually a slow advance in process management:
•Record Management
•Workflow - 1970
•Business Process Re-engineering (BPR) - 1990
•Business Process Management (BPR) - 2000

39. Western Management TheoriesWestern Management Theories
Is there an Asian Management Theory??Is there an Asian Management Theory??

40. What is business managementWhat is business management
the Asian way?the Asian way?
Business tend to be small scale
Time has no beginning and end
Individualism is less relevant; managerial beliefs shift
towards the autocratic end
Conformity to socially acceptable behaviors is done
through morality (e.g losing face)
Oriental managers rely less on interpersonal
confrontations
Managerial decisions consider effects on othe rpeople
Control of performance is less formal
Maintaining and developing guanxi (connection and
relationship
*From World Executive Digest by Redding & Martyn, 1984

41. ““Will Western ManagementWill Western Management
work in Asia?”*work in Asia?”*
“Values and attitudes affect but do not invalidate the
transfer of American management concepts…
Consequently, when we wish to transfer an effective
device from one culture to another, careful attention
should be given to underlying premises…?
“Tools of management remain the same.”**
“Economic and business philosophy are however,
different.”**
Combination of general management, functional
management, and communal organization and
management..**
*From World Executive Digest by William Newman, 1984
**From World Executive Digest by Sixto Roxas, 1981
Photo from www.aim.edu.ph

42. Is there a Filipino ManagementIs there a Filipino Management
Theory??Theory??
Are Western theories applicable inAre Western theories applicable in
Philippine setting?Philippine setting?

43. Are Western Theories Applicable inAre Western Theories Applicable in
Philippine Setting?Philippine Setting?
“The models and ideal types taught in Western-oriented
MBA programs are based on certain assumptions, many
of which are invalid in the Philippines.
Although organizations here have most of the structures
and formal procedures of Western business, actual day-
to-day business processes and interactions necessarily
proceed within the matrix of Filipino culture and values.
Thus, the need for the Westerner to go "the extra mile"
to understand what's really going on and adapt a
culturally sensitive style of doing business.”
- Clarence Henderson,
Henderson Consulting International

44. What is Pinoy Management Theory??What is Pinoy Management Theory??
“No one Management Theory or Style.”
Under the formal organization are:
“Informal organization”
“Battlefield of behavioral styles among managers and
employees”
“Unknown cultural ambiance among peoples and
systems”
From “Pinoy Management” by Ernesto Franco, 1986

45. Weaknesses of Pinoy WorkersWeaknesses of Pinoy Workers
Walang bilib sa sarili (No confidence in oneself)
Dikdik sa Colonial Mentality (Indoctrinated with
Colonial Mentality)
Masyadong relaks (Overly relaxed)
Ningas-cogon (Not a follow-up people)
Holiday mentality
Lack of managerial and organizational
effectiveness
Lack of self-reliant tenacity
From “Pinoy Management” by Ernesto Franco, 1986

46. Pinoy ManagementPinoy Management
Kailangan may No. 2 (There is a need for No.2)
Tsismis machine (Grapevine Machine)
Kailangan may Hatchet Man (There is need for a Hatchet
Man)
Be an expert on timing
Lumayo sa madalas matalo (Avoid losers)
Gawin mong personal (Make it personal)
NBA Style: One-on-one
Power play. Laban (Fight)
Be situational and contingent
Umarte kang parang intelihente. Iyong laging nag-iisip
Body language ang importante (Body language is important)
Pag sinabing “No”, dapat “No” talaga
From “Pinoy Management” by Ernesto Franco, 1986

47. Pinoy Management ApproachesPinoy Management Approaches
Management by “Kayod” (Realist Manager)
He wants quick action
He’s an autocrat
He is sigurista
He has gut feel
He knows how to use people
Management by “Libro” (Idealist Manager)
He is a thinker; technocrat; mabusisi; may sistema
Matigas and ulo
From “Pinoy Management” by Ernesto Franco, 1986

48. Pinoy Management ApproachesPinoy Management Approaches
Management by “Lusot” (Opportunist Manager)
He is galawgaw
Walang konsensiya
Mahilig sa lusot (Loves to get by)
Mahilig sa ayusan
Ugnayan-Management (The Hybrid)
Has balance
Contingency management style
He is solid
Marunong pumili (Chooses well)
Pambihira talaga (Exceptionally gifted)
From “Pinoy Management” by Ernesto Franco, 1986

49. ENDEND