LECTURE 3 — CLASSICAL MANAGEMENT APPROACH SCIENTIFIC MANAGEMENT

LECTURE 3 - CLASSICAL MANAGEMENT APPROACH: SCIENTIFIC MANAGEMENT APPROACH: THEORY OUTLINE: 1. Prerequisite of classical management approach 2. Scientific management : its content and main scientists 3. Frederick Taylor’s Scientific Method 4. Four principles of scientific management 5. Henry L. Gantt, The Gilbreths 6. Contributions and problems of scientific management theory

1. 1 Prerequisite of classical management approach. v. Industrial – Having to do with industry, business or manufacturing v. Revolution – a huge change or a change in the way things are done v. Industrial Revolution – a change from making things by hand to making them in factories.

1. 2 Prerequisite of classical management approach. Timeline Historical Timeline

1. 3 Prerequisite of classical management approach. TRANSPORTATION v. Before the Industrial Revolution, people relied on the horse and their own feet to get around. v. With the invention of the steam locomotive, transportation took a huge step forward. v. The first two major railroad companies were the Union Pacific and Central Pacific Railroads.

1. 4 Prerequisite of classical management approach. PASSENGER CARRIERS

1. 5 Prerequisite of classical management approach.

1. 6 Prerequisite of classical management approach. AN ORIGINAL STEAM ENGINE

1. 7 Prerequisite of classical management approach. STEAM LOCOMOTIVE

1. 8 Prerequisite of classical management approach. TEXTILES v. With the invention of the spinning jenny and the power loom, the textile industry took off. v. Clothes could now be made far faster than ever before.

1. 9 Prerequisite of classical management approach. SPINNING WHEEL v The spinning wheel was the first invention, but it was very slow. v Threads were spun one at a time, by hand.

1. 10 Prerequisite of classical management approach. THE SPINNING JENNY v The spinning jenny could spin up to eight thread at time. The spinning jenny was much faster than the spinning wheel.

1. 11 Prerequisite of classical management approach. THE SPINNING MULE v. The spinning mule used water power to spin the thread, which was much faster than doing it by hand. v. More cloth could now be made.

1. 12 Prerequisite of classical management approach. THE POWER LOOM v The power loom used water power to weave cloth. v People could make a lot of cloth quickly.

1. 13 Prerequisite of classical management approach.

1. 14 Prerequisite of classical management approach. A COTTON FACTORY

1. 15 Prerequisite of classical management approach. AGRICULTURE v Advances in agriculture were also made. v The invention of the seed drill allowed farmers to plant many more seeds much more quickly. v The reaper allowed farmers to harvest their crops more efficiently. v More crops could now be grown feeding an increasing population.

1. 16 Prerequisite of classical management approach. STEEL v With the invention of steel, buildings could be made much taller. v Steel was much harder than iron, which would bend if made too tall. v The steel industry created many new products, and led to the invention of the car. Andrew Carnegie became a millionaire in the steel business by putting all his competitors out of business. He created U. S. Steel in Pittsburg.

1. 17 Prerequisite of classical management approach. THE ELECTRIC LIGHT v Can you imagine what life would be like without the electric light? v Thomas Edison invented the electric light. v Thomas Edison also invented many other things, like the phonograph.

1. 18 Prerequisite of classical management approach. TELEGRAPH v In 1844, Samuel Morse demonstrates his telegraph by sending a message to Baltimore from the chambers of the Supreme Court in Washington, DC. The message, "What hath God wrought? , " marks the beginning of a new era in communication. v The telegraph used dots and dashes to send messages over electric lines. These dots and dashes became known as Morse Code.

1. 19 Prerequisite of classical management approach. TELEPHONE v Alexander Graham Bell patented the first telephone in 1876.

1. 20 Prerequisite of classical management approach. ORVILLE AND WILBER WRIGHT v The Wright brothers were the first men to successfully fly an airplane. v The flight lasted only twelve seconds, but it proved men could fly.

1. 21 PREREQUISITE OF CLASSICAL MANAGEMENT APPROACH • The Industrial Revolution (period from 1750 to 1850 ) is the process of change from an agrarian, handicraft or feudal economy to one dominated by industry. • England is the birthplace of Industrial Revolution. • Innovations, made in the second half of the 18 th century: Textiles Steam power Iron making • Traditional methods of production -- the domestic handicraft system of manufacturing -- could not provide adequate response to market conditions. It led to factorybased mechanization. • The critical manufacturing change that marks the Industrial Revolution is the production of interchangeable parts.

1. 22 Prerequisite of classical management approach. • 1. (1600– 1740) Financial-agricultural revolution • 2. (1780– 1840) Industrial revolution • 3. (1880– 1920) Technical revolution (or Second Industrial Revolution) • 4. (1940– 1970) Scientific-technical revolution • 5. (1985– 2000) Information and telecommunications revolution

1. 23 Prerequisite of classical management approach. Technological features of Industrial Revolution: • The use of new basic materials -- iron and steel. • The use of new energy sources -- both fuels and motive power -- such as coal, steam engine, electricity, petroleum, and internal combustion engine. • The invention of new machines -- spinning jenny and the power loom that permitted increased production with smaller expenditure of human energy. • The new organization of work -- the Factory System -- which entailed increased division of work and specialization of function. • Developments in transportation and communications -- steam locomotive, steamship, automobile, airplane, telegraph, and radio. • The increasing application of science to industry.

1. 24 Prerequisite of classical management approach. Socio-economic and Cultural Features of Industrial Revolution: • Agricultural revolution produced surplus production for consumption of industrial, commercial and other non-agricultural population. • Economic shift from land to industry resulted in broader distribution of wealth, especially among the bourgeoisie, the new middle class. • Political changes reflected shift of economic power. Hence, new laws and state policies reflected the economic interests of new power holders. • Sweeping social changes -- growth of cities, development of working class movements, and emergence of new patterns of authority. • Cultural transformations of broader order. The worker acquired new and distinctive skills and relation to task shifted. Instead of craftsman with hands tools, he became a machine operator, subject to factory discipline. • Psychological change -- man’s confidence in his ability to use resources and to master nature was heightened.

1. 25 Prerequisite of classical management approach. Evolution of Management Theories

2. 1 SCIENTIFIC MANAGEMENT : ITS CONTENT AND MAIN SCIENTISTS 1. Scientific management is a theory of management that analyzes and synthesizes workflows, with the objective of improving labor productivity. 2. Main purpose: the systematic study of the relationships . between people and tasks for the purpose of redesigning the work process for higher efficiency. 3. Began in the industrial revolution in the late 19 th century as: -managers of organizations began seeking ways to better satisfy customer needs. -social problems developed in the large groups of workers employed under the factory system. -managers began to focus on increasing the efficiency of the worker-task mix. 4. Contributors of theory: Frederick W. Taylor (18561915); Henry L. Gantt (1861 -1919); Frank Gilbreth ( 18681924) & Lillian Gilbreth (1878 -1972).

3. 1 FREDERICK TAYLOR’S SCIENTIFIC METHOD Biography: (March 20, 1856 – March 21, 1915) Wealthy Philadelphia Quaker family 1915) Worked in hydraulics factory as laborer/ foreman/chief engineer At 25 earned college degree in engineering At 25 At 35 - consultant: introduced functional At 35 - foreman, production planning, differential pay= cut costs/increased production) 1909 -14: Lecturer at Harvard 1909 -14: Management consultant – US Navy and Army 1911 - Wrote monograph The Principles of 1911 Scientific Management, published in 1911 1915 -Taylor caught pneumonia and one day 1915 after his fifty-ninth birthday, on March 21, he died. Taylor authored 42 patents.

3. 2 FREDERICK TAYLOR’S SCIENTIFIC METHOD “Soldiering” – people don’t always try/work hard. WHY? If we work hard and complete the job – no more work next day; fewer workers needed! SO what is the amount of time needed to do the job? How should it be performed – “One Best Way” What is the standard?

3. 3 FREDERICK TAYLOR’S SCIENTIFIC METHOD ▼ The Father of Scientific Management ▼ Pursued four key goals: – – Develop a science of management Select workers scientifically Develop and train workers scientifically Create cooperation between management and labor ▼ Determined the quickest ways to perform tasks 30

3. 4 FREDERICK TAYLOR’S SCIENTIFIC METHOD Taylor’s methodical approach to determine the “one best way” to perform a job consisted of the following steps: way” 1. Select a sample of skilled workers and carefully study the job being done. 2. Carefully list each operation including extensive detail on each task being performed. 3. Utilize a stopwatch to time each task being performed. 4. Identify and eliminate any unnecessary tasks that are performed to finalize the job. 5. Identify any improvements, tools or techniques that can be adopted to reduce the time in performing the job. 6. Establish new and informed times and pay-rates for the job. 7. Lastly, all workers are trained to perform the job in the “one best way” identified.

4. FOUR PRINCIPLES OF SCIENTIFIC MANAGEMENT 1. Study the ways jobs are performed now and determine new ways to do them. • Gather detailed time and motion information. • Try different methods to see which is best. 2. Codify the new methods into rules. • Teach to all workers the new method. 3. Select workers whose skills match the rules. 4. Establish fair levels of performance and pay a premium for higher performance.

10. SCIENTIFIC WORK STUDY (F. TAYLOR’S SCIENTIFIC METHOD ) – Method Study: The purpose of this study is to maximise efficiency in the use of materials, machinery, manpower and capital by improving work methods. This study involves the critical examination of plant layout, product design, material handling and work processes, to minimise time, distance and cost involved in the transportation and storage of materials. – Motion Study: This study refers to the study of the movements of an operator or a machine involved in a task with a view to elimi nate superfluous or useless motions and to improve the others. – Time Study: This study refers to the study of the time taken to perform each operation of a job in order to find out the proper time that should be taken in doing the job. – Fatigue Study: Fatigue study seeks to find out how long a person can perform the standard task without adverse effect on his health and efficiency

4. Henry L. Gantt, The Gilbreths Frank and Lillian Gilbreth Biography: Frank Gilbreth (1868 - 1924) - Frank Gilbreth (1868 - 1924) engineer; pioneered Scientific Methods in bricklaying. Member of Taylor Society (SAM) Lillian Gilbreth (1878 -1972) - engineer/industrial psychologist (Ph. D); stress and fatigue Contribution: - Time and motion studies - Breaking up each job action into its components (Therblig). - Finding better ways to perform the action. - Reorganizing each job action to be more efficient. - Focus on promoting individual worker’s welfare. - Emphasis on enabling workers to reach they full potential. - Emphasis on employee motivation&physical well being of workers.

4. HENRY L. GANTT, THE GILBRETHS (cont’d) Henry L. Gantt Biography: He worked as a teacher and Biography: draughtsman before becoming a mechanical engineer. In 1887, he joined Frederick W. Taylor in In 1887 applying scientific management principles to their work at Midvale Steel and Bethlehem Steel—working there with Taylor until 1893. In his later career as a management consultant—following the invention of the Gantt chart—he also designed the 'task Gantt chart and bonus' system of wage payment and additional measurement methods worker efficiency and productivity.

4. HENRY L. GANTT, THE GILBRETHS (cont’d) Gantt charts Contribution of Gantt: 1. Abandoning Taylor’s Differential Rate System 2. Emphasis on the “Evaluation of Performance” of a worker 3. Emphasis on “incentive-based” (Bonus) payment. 4. Introduction of a specific charting system, “Gantt Chart” for production scheduling. 5. The concept led to the subsequent evolution of Critical Path Method /CPM (developed by Du Pont) & Program Evaluation and Review technique/PERT.

5. CONTRIBUTIONS AND PROBLEMS OF SCIENTIFIC MANAGEMENT THEORY (cont’d) Lessons from Classical Scientific Thinkers Analyze everything Teach effective methods to others Constantly monitor workers Plan responsibly Control the work and the workers 40

5. CONTRIBUTIONS AND PROBLEMS OF SCIENTIFIC MANAGEMENT THEORY Criticisms of scientific management From organized labor • too much pressure to perform placed on the workers • unfair division of rewards between management and labor • did not appreciate the social context of work and higher needs of workers • specialized jobs became very boring, dull. • managers frequently implemented only the increased output side of Taylor’s plan. (Workers did not share in the increased output). From behavioral scientists (later) • presents an oversimplified approach to worker motivation • too authoritarian in approach • demands excessive specialization of jobs and tasks • did not acknowledge variance among individuals. • tended to regard workers as uninformed and ignored their ideas and suggestions - focused on the manufacturing environment.

5. CONTRIBUTIONS AND PROBLEMS OF SCIENTIFIC MANAGEMENT THEORY (cont’d) Demise of Scientific Management • In hands of business – Scientific Management = tool to exploit labor • By 1915 – growing labor against “Taylorism” • Union members/100 workers: 1880=1. 8; 1900=7. 5; 1914=10. 5 • Congress investigates and US Commission on Industrial Relations issues Hoxie Report (1915) declaring Scientific Management as exploitive of labor. • It will influence Management thought – but Scientific Management is dead – until rediscovered in Japan – the 1970/s wave of Quality Management