The Importance of Management Theories in Professional Management
The requirement for the Development of Management Theories came up with the requirement for professional management in an organisation. A thorough study and analysis of the management of business operations along with performance management has been contributing towards the running of an organisation in accordance with its objectives and goals. A detailed study of various Management Theories and approaches has been presented below.
List of Management Theories
Over the years, several different contributions by management practitioners and writers have resulted in a myriad of approaches to business management. These comprise a “Management Theory jungle” as described by Koontz and Weirich. The following are the major contributions of management practitioners.
Scientific Management Theory by Frederick Taylor
In his attempt to use the systematic study as a part of his theory, Frederick Taylor found a developmental approach towards professional management. His theory known as the scientific Management Theory is based on 5 principles as stated below.
Developing scientific techniques to analyse and determine the best methods of doing a particular job.
Scientific management in selecting and training workers for maximum productivity.
Creation of an organisational cooperative environment to avoid discord in group action.
Ensuring an equal distribution of work and responsibilities to achieve maximum cooperation and zero individualism.
Working towards ensuring maximum output.
Bureaucracy Theory by Max Weber
The idea of organisations to be bureaucratic was brought forward by Max Weber. This ensured control on the basis of knowledge, work experience, and expertise. His theory represents a hierarchical pyramid where rules and regulations are defined and promotions are based on qualifications. Here are the principles guiding the Max Weber theory:
The hiring of staff is based on educational and technical qualifications.
It is the task of the manager to decide on the promotions based on achievements or experience.
There should be a chain of command in the organisational structure, along with a grievance reporting process for securing employee rights.
Equal distribution of labour.
Impartial management.
Everything has to be kept recorded in writing.
The management concept and process should let the managers manage the company. Management should not be the responsibility of the owners.
General Management Theory by Henri Fayol, the Father of Modern Management Theory
Henri Fayol, often regarded as the ‘Father of Modern Management Theory,’ created the general Management Theory that can be applied in every field of work and administration. In this theory, the manager’s responsibilities were categorised by Fayol on the basis of the management tasks to plan, to organise, to command, to coordinate, and to control. His 14 management principles are hereby stated.
Division and distribution of work aimed at reaching maximum output with the minimum effort possible.
Responsibilities come with authority.
There should be discipline amongst employees.
There should be a unity of command where an employee receives orders and reports to only one superior.
There should be a unity of direction aimed at the fulfilment of the primary organisational goal.
Subordination brings up the preference for the general interest in comparison to individual interest.
Remuneration should be satisfying for the employees as well as the firm.
Centralization should be practised within the organisation along with the delegation of authority and determining managerial responsibilities.
The order should be kept intact with an appointed place for employees and processes.
There should be a scalar chain determining the relationship between employees and their superiors.
Equal treatment of employees.
Stable tenure of the personnel.
Managers must be bold enough to take and implement initiatives.
Esprit de Corps should be maintained with proper teamwork being emphasised along with sound communication.
Robert Owen’s Management Theory
Robert Owen, regarded as the Father of Personnel Management, created a theory as a part of which workers were to spend fewer hours than previously prescribed, and were to be paid wages higher than before. He encouraged the creation of an organisational environment where everyone would collaborate and create with increased productivity. As a part of his Management Theory and practice notes, his contributions to management improved the work conditions in factories.
The famous experiments at the Hawthorne Plant by Elton Mayo and F.J. Roethlisberger also deserves a mention in this discussion on Management Theories. They observed that improvement in productivity in group action was dependent on factors like interrelationship between members, morale, and effective management.
Professional management is the backbone of an organisation that should be perfectly aligned with its mission, vision, and objectives. For this, the continuous Development of Management Theories has been focused on for decades. Other contributors who introduced various approaches to management are Peter Drucker, William Ouchi, Robert Waterman, and so on.
The Background for the Development of Management Theories
After the Industrial revolution of the 18th century in England the manufacturing units developed into big industries. These industries increased the speed of production of various goods by employing a large body of workforce. Controlling and managing such a large body of organisation got difficult and complicated day by day. So many thinkers and industrialists tried to define a standard set of systems or rules to manage the process and workforce involved in the running of an enterprise. Many Scholars of those times, such as Henri Fayol, Max Weber, Robert Owen, have formulated different types of Management Theories to conduct the management of any organisation in a professional manner. Henry Fayol is regarded as the Father of Modern Management Theory.
In later periods many professionals have tried to contribute to the existing Management Theories significantly and helped to develop the theories as we see today. Today Management Theories help not only in organising the workforce and controlling business units but also provide guidance for the management of performance of individuals contributing for the achievement of any goal by any organisation. Service sector enterprises or organisations are the major players of the current economy of the world. These businesses require the most attention for running it along the management lines. Even the government is considered as an organisation to be dealt with according to the Management Theories in a top- down approach. All in all a systematic framework in any organisation is quintessential for its success. Dynamic communication and a favourable environment also play a part in this endeavour.
Developing Scientific techniques to determine the methods and selecting workers is the main focus of the majority of Management Theories. They also emphasise organisational cooperation and correct distribution of work among employees. The ultimate goal of all these theories is to maximise the output and increase the profitability of the investors.
Learning These concepts will help the students to manage and organise the businesses successfully in their future.
FAQs on Development of Management Theories: A Historical Perspective
1. What is meant by the historical perspective of management theories?
The historical perspective of management theories refers to the evolution of ideas about how to best manage an organisation. It tracks the development of different schools of thought, starting from the early classical approaches focused on efficiency after the Industrial Revolution, to the human relations movement that emphasised the worker's role, and finally to modern theories that view organisations as complex systems. Studying this history helps understand why we use certain management practices today.
2. What are the major schools of thought in the evolution of management theories?
The evolution of management thought is generally categorised into three major schools, as per the CBSE 2025-26 syllabus:
- Classical School: The earliest school, focusing on efficiency and productivity. It includes Scientific Management (F.W. Taylor), Administrative Management (Henri Fayol), and Bureaucratic Management (Max Weber).
- Neo-Classical School (Human Relations): This school emerged as a reaction to the classical school's rigid view. It highlights the importance of the human element, motivation, and social factors, with key contributions from Elton Mayo (Hawthorne Studies).
- Modern School: This includes contemporary approaches like the Systems Approach and Contingency Approach, which see organisations as dynamic entities interacting with their environment.
3. What are the core principles of F.W. Taylor's Scientific Management?
Frederick Winslow Taylor's Scientific Management aims to improve economic efficiency and labour productivity by applying scientific methods. Its core principles are:
- Science, Not Rule of Thumb: Replacing old, traditional work methods with methods based on a scientific study of tasks.
- Harmony, Not Discord: Fostering complete harmony and cooperation between management and workers.
- Cooperation, Not Individualism: Ensuring cooperation to achieve work targets, rather than fostering individual competition.
- Development of Each Person: Scientifically selecting, training, and developing each employee to their greatest efficiency and prosperity.
4. What are Henri Fayol's 14 Principles of Administrative Management?
Henri Fayol, known as the 'Father of Modern Management', provided 14 principles for managing an organisation effectively. These are: Division of Work, Authority and Responsibility, Discipline, Unity of Command, Unity of Direction, Subordination of Individual Interest to General Interest, Remuneration, Centralisation and Decentralisation, Scalar Chain, Order, Equity, Stability of Tenure of Personnel, Initiative, and Esprit de Corps (team spirit).
5. How does Max Weber's theory of Bureaucracy contribute to management thought?
Max Weber's theory of bureaucracy provided a formal framework for structuring large organisations to ensure efficiency and control. His key contribution was the idea of a rational system based on rules, not personal whims. Its main features include a clear hierarchy of authority, formal selection of employees based on technical qualification, standardised rules and regulations, and an impersonal nature in the application of rules to avoid favouritism.
6. What is the key difference between Taylor's Scientific Management and Fayol's Administrative Management?
The primary difference lies in their focus and perspective. Taylor's Scientific Management is a micro-level, bottom-up approach concerned with the efficiency of individual workers and tasks on the shop floor. In contrast, Fayol's Administrative Management is a macro-level, top-down approach focused on the entire organisation and the core functions of managers. Taylor aimed to improve worker productivity, while Fayol provided universal principles for overall administration.
7. Why are Elton Mayo's Hawthorne Studies considered a major turning point in management history?
The Hawthorne Studies are a turning point because they shifted management focus from a purely mechanistic view (like Taylor's) to a human-centric perspective. The experiments revealed that productivity wasn't just tied to physical conditions but was significantly impacted by social and psychological factors like employee morale, informal group dynamics, communication, and a sense of belonging. This discovery laid the foundation for the Human Relations Movement in management.
8. How did the Human Relations approach challenge the ideas of the Classical School of management?
The Human Relations approach directly challenged the Classical School's core assumptions. While the Classical School (Taylor, Fayol) viewed workers as cogs in a machine motivated primarily by economic incentives, the Human Relations movement argued that workers are complex social beings. It highlighted that social needs, recognition, and morale were often more powerful motivators than financial rewards alone, thus challenging the classical emphasis on rigid structure and authority.
9. In what ways are classical management theories still relevant in today's businesses?
Despite their age, classical theories are foundational to modern management. For example:
- Taylor's principles are visible in assembly lines, time-and-motion studies, and performance-based incentive systems in manufacturing and service industries.
- Fayol's 14 principles, such as Division of Work and Unity of Command, form the basis of most modern organisational charts and hierarchical structures.
- Weber's bureaucracy provides the blueprint for formal rules, policies, and standard operating procedures (SOPs) that ensure consistency and fairness in large corporations and government agencies.
10. What are the primary criticisms or limitations of the classical management theories?
The classical theories, while groundbreaking, have several key limitations. They are often criticised for:
- Being too mechanistic: They largely ignore human psychology, social needs, and job satisfaction, treating workers as interchangeable parts.
- A 'one-size-fits-all' approach: They propose universal principles, failing to consider that different situations (contingencies) may require different management styles.
- Stifling creativity: The strong emphasis on rigid hierarchy, rules, and control in bureaucratic models can discourage innovation, flexibility, and employee initiative.
