The Classical Approach is one of the oldest approaches in management and is also known by various names, i.e., Empirical, Functional and Management Process Approach.
The classical theory represents the traditional thoughts about organisations. It is based on the prototype industrial and military organisation. The theory concentrates on organisation structure and their management.
The classical writers include Taylor, Fayol, Weber, Gullick, Urwick, Mooney and Reiley and others. They placed emphasis on work planning, the technical requirements, principles of management, formal structure, and the assumption of rational and logical behaviour.
This theory incorporates three view points:
(i) Taylor’s view point,
(ii) Fayol’s Administrative theory,
(iii) Weber’s Bureaucracy.
All these writers concentrated on structure and that why their approach sometimes characterized as ‘structural framework of organisation.’ F.W. Taylor insisted on application of scientific methods to the problems of management. Henry Fayol suggested fourteen principles of management and their universal application.
Max Weber introduced rationality in organisation. It is characterized by division of labour, specialization, structure, personnel competency, etc.
Classical approach signifies from the following features:
(i) Classical theory concentrate on anatomy of formal organisation through division of labour, specialization, structure, scalar, functional processes and span of control.
(ii) Management is the study of managerial experiences. If the experiences are studied and certain generalizations are deducted there from, these will help the practicing managers.
(iii) Classical Approach treats organisation as a closed system.
(iv) Formal organisation structure coordinates the activities of the organisation. They ignored the element of human beings.
(v) Principles and functions of management have universal application.
(vi) Scientific management emphasized efficiency of lower levels of organisations.
(vii) Work force were supposed to be rational economic force, they could be motivated through economic incentives.
(viii) Classical approach emphasized on ‘centralization of authority’.
This school is based on the close study of past managerial experience and cases, so formal education and training is needed for developing managerial skills.
Limitations of Classical Theory:
The classical approach suffers from several limitations:
(i) The classical ignored the human relations aspects and undermines the role of human factor.
(ii) Classical viewed organisation as a closed system, i.e., having no interaction with external environment.
(iii) Economic rewards assumed as the main motivator of work force. They have ignored nonmonetary factors.
(iv) The classical principles are based on managerial experiences and their limited observations. These are not empirical.
(v) Classical approach is based on over-simplified assumptions. Its principles are ambiguous and contradictory.
(vi) This school emphasized on strict adherence to rules and regulations. The scope for individual initiative is thus limited.
Classical approach is based on three main points i.e.,
i. Scientific management,
ii. Administrative and
iii. Bureaucratic theory.
i. Scientific Management Theory:
Frederick Winslow Taylor is acknowledged as the “father of scientific management”. Probably no other person has had a greater impact on the early development of management.
His experience as an apprentice, a common labour, a foreman, mechanic and then the chief Engineer gave opportunity to know first-hand problems and attitudes of workers and to see the great possibilities for improving the quality of management. Other contributors like Frank and Lilian Gilbreth, Henry Gantt Emerson also suggested the effective use of human beings in industrial organisation.
They studied the use of human beings as adjuncts to machines in performance of routine tasks. It was only Taylor who gave concrete shape to the theory of scientific management.
He started his career as a labour in Midvale steel company in 1874 after discontinuing his study. After that he was promoted as a mechanic, and then he was appointed as the chief Engineer of the company within six years. After obtaining the graduation in physics and mathematics and later on Master of Engineering, he was employed by the Bethlehem steel company to increase output; which had been a serious problem.
He invented high speed steel cutting tools and spent most of his life as a consulting Engineer. However, his major concern was to increase efficiency in production, not only to lower costs but also to make possible increased pay for workers through their higher productivity.
Scientific management employs scientific methods to the problems of management. He defined scientific management as the art of “Knowing exactly what you want men to do and then seeing that how they do it in the best and the cheapest way.” He advocated scientific task setting based on time and motion study, standardization of materials, tools and working conditions, scientific selection and training of workers and so on.
But he was confined to management at the top level. Most of his experiments were carried out in Midvale steel company and Bethlehem steel company. The process of initiation of experiment carried on Midvale steel company was based on ‘time and motion study’, and further at Bethlehem also.
However, he conducted experiments mainly on three functions to find out the best way of working:
(a) The pig iron handling,
(b) The shoveling experiments, and
(c) The metal cutting experiments.
He explained the basic philosophy of management in the following terms:
(a) Replacing rule of thumb methods with science,
(b) Scientific selection and training of workers,
(c) Co-operation of labour and management to accomplish work,
(d) Working for maximum output, rather than restricted output, and
(e) A more equal division of responsibility between managers and workers.
Taylor adopted ‘differential piece rate plan’ to motivate the workers for higher efficiency. According to this plan, high wages in the form of incentive was provided to those workers who perform more than standard work.
Scientific management involves a complete mental revolution on the part of the working men engaged in any particular establishment or industry, a complete mental change on the part of these men as to their duties towards their work, towards their fellowmen, and towards their employers.
It involves equally complete mental change on the part of those on the managements’ front — the foreman, the superiors, the superintendent, the owners, the Board of Directors — a complete mental revolution on their part as to their duties towards their fellow workers in management.
Taylor advocated that without complete mental change on both the sides, scientific management does not exist. The basic theme behind scientific management is to change the mental attitude of the workers and the management towards each other.
He advocated that:
(i) There is a change in the mental attitude of the workers, and
(ii) There is also a positive mental change in the attitude of management.
He called the positive change in the attitude of workers and management as a revolution in management.
He called it ‘Mental Revolution’ which has three implications:
(i) Effort to increase in production,
(ii) Creation of mutual trust and confidence, and
(iii) Developing scientific attitude towards problems.
He suggested management to find out the best methods of doing various jobs and introduced standardized materials, tools and equipment to reduced wastages. Management must create congenial environment for optimum efficiency. Congenial environment should be created through the cooperation of workers and management; and it is only the congenial atmosphere that brings out the maximum productivity.
Principles of Scientific Management:
To put the philosophy of scientific management into practice, Taylor and his associates suggested the following techniques:
(1) Scientific Task Planning – Scientific planning suggests series of separate operations and function which are already determined by the management. How the task is performed? What way? Who performs it? What’s the procedure of performing the task? It provides the answers to these questions.
(2) Functional Foremanship – Taylor evolved functional foremanship to supervise and giving various directions. In this system, eight persons direct the activities of workers, out of them four persons are related with planning functions and the remaining four are concerned with operating level-Functional foremanship involves the duties of – (i) Route clerk, (ii) Instruction and clerk, (iii) Time and cost clerk, (iv) disciplinarian, (v) Speed boss, (vi) Inspector, (vii) Maintenance foreman, and (viii) Gang boss.
(3) Job Analysis – Work management has been suggested by Taylor. There is one best way of doing a job which requires least movements, consequently less time and cost.
He advocated the analysis of work job with reference to:
(a) Time Study – Every work/job requires standard time to carry out under specific conditions. Time study involves the determination of time a movement has to complete.
(b) Motion Study – Motion study involves the study of movement of both the workers and machines so as to identify wasteful movements and performing only necessary movements.
(c) Fatigue Study – The fatigue study shows the time and frequency of rest. On the basis of this, management should provide appropriate rest at appropriate intervals to increase the efficiency of workers.
(4) Differential Piece Rate System – He advocated that there is direct link between, remuneration and productivity for motivating employees. Taylor applied differential piece-rate system which is of highly motivating technique.
Different piece rate system adopted on workers:
(a) Low rate for those who fail to achieve the standard output; and
(b) Higher rate for those achieving or exceeding the standard output.
The rate should be based on individual performance and on the position which he occupies. He stressed for scientific determination of remuneration for workers.
(5) Standardization – Standardization helps to simplify work, to ensure uniformity of operations and to facilitate companions of efficiency. Standards are laid down regarding work, materials, tools and techniques, time, working conditions, etc. These things should be fixed in advance on the basis of observations.
(6) Scientific Selection and Training – Workers should be selected on scientific basis, and on the basis of their education, experience, aptitude, strengths, etc. Each element of selection should be considered properly. A worker should be selected according to the requirement of work. Training should be provided to workers to make them work efficiently.
(7) Co-Operation between Management and Workers – Scientific management succeeds through the cooperation between management and workers. There should be a mental change to cooperate with each other and to find out the way out of problem through scientific methods. Scientific management depends upon the cooperation of these two. Taylor termed this cooperation as a Mental Revolution.
Critical Evaluation of Scientific Management:
Scientific Management is more concerned about the activities at operation level in the organization, rather than total functions. Similarly, they emphasized physiological variables affecting human behaviour at work-place, both in terms at work efficiency and methods of motivation.
As such, the scientific management is more relevant to mechanization and automation-technical aspect of efficiency. Even the mental change of both management and workers could be sought to achieve maximum production.
So, scientific management has been criticized broadly on the following fronts:
(1) Scientific management is a mechanic aspect as it ignores the human element in the organization. Workers are treated as mere extensions of machines devoid of any feeling and emotion. Taylor and his associates treated workers as factors of production, as there is no value of their social and psychological needs.
(2) Scientific management focused mainly on efficiency at the operation/shop level, as a consequence organisation or industry has the importance on the areas of operational level. In this sense, it also denotes as a field of industrial engineering.
(3) Scientific management emphasized that planning function should be separated from actual performance and should be given to specialists. This is impracticable. Planning cannot be fully separated from doing, because you are doing on planned basis; and if there is any change takes place, you also try to absorb these changes in work. Planning and doing are two sides of the same job.
(4) Scientific management advocated functional foremanship to bring specialization in the organisation. But this is not applicable in practice as the worker cannot carry out instructions from eight foremen. This violates the principles of unity of command.
(5) The approach of scientific management is criticized that it advocates close supervision and control as to get maximum contribution. But this practice has limited use and only applicable in a limited way at shop floor.
(6) This approach also advocates that standards are laid down regarding everything in the organisation. However, standardization helps to simplify work, but to some extent. It is not confident that the standardization of every task/activity brings out uniformity in operations and helps to increase productivity.
(7) Workers are forced to do the standard work, and they are motivated to pay more if they achieve the standard. So in the name of increasing efficiency, workers are forced to speed up their functions, i.e., exploitation. And this also is not a type of motivation. They perform the least standard, they have degraded and vice-versa. They force the workers to work hard, and this is clearly exploitation.
Finally, Taylor made a long-lasting contribution in management. Taylor was the first pioneer in introducing scientific management reasoning to the discipline of management. Many of the contributions provide the basis of modern management.
Really, scientific management provides a basic input to enliven the theories and approaches which give reasoning to management. Simply, Taylor laid the foundation of modern management as a science.
ii. Administrative Management Approach:
It was Henry Fayol who, for the first time, studied the functions and principles of management in a systematic manner. The notable contributions have also been made by Oliver Sheldon, Haldane, Luther Gullick, Mooney and Reiley, Urwick and many others. These defined management in terms of certain functions and then laid down fourteen principles of management which are universally applicable.
Henry Fayol was a French mining engineer turned chief administrator in a large French mining and metallurgical company. In 1916, he published his famous book in French language Administration Industrialle at Generale. It is in four parts of which the first part deals with classification of business activities
Second part contain basic functions of management performed by manager; third part consists of fourteen principles of general managements and fourth part deals with managerial qualities and skills. Henry Fayol was the first person who emphasized managerial organisation and process. Fayol tried to develop a complete theory of management. He discussed the principles of management and recommended teaching in management.
Organizational Activities:
Henri Fayol found that industrial activities could be divided into six groups, or classified all operations into six ways:
(i) Technical (Production),
(ii) Commercial (Buying, Selling and Exchanging),
(iii) Financial (Search and Optimum use of capital).
(iv) Security (Protection),
(v) Accounting (Balance sheet, Costing, Records), and
(vi) Managerial – (a) Planning; (b) Organising; (c) Commanding; (d) Coordinating; (e) Controlling.
He points out that these activities exist in every organisation. He pointed out that first five activities are well known to a manager and the last managerial activity must have been approached by managers at every stage. Fayol concentrated on, the analysis of managerial activities.
Fayol has divided his approach of studying management into three parts:
(i) Managerial qualities and training,
(ii) Principles of management; and
(iii) Elements of management.
Managerial Qualities and Training:
Henry Fayol identified the various qualities for a manager.
According to him these qualities are:
(i) Physical – Health, vigour and address.
(ii) Mental – Ability to understand and learn, judgement, mental vigour, and adaptability.
(iii) Moral – Energy, fitness, initiative, loyalty, tact and dignity.
(iv) Educational – Acquaintance with matters related to general functioning.
(v) Technical – Acquaintance with functions being performed.
(vi) Experience – Arising from work.
Fayol listed fourteen principles based on his experience. However, the list is not exhaustive. They are summarized in the perspective. He noted that these principles are flexible and not absolute, and must be usable regardless of changing and special conditions.
These principles are as follows:
(1) Division of Work – Fayol advocated division of work to take the advantage of specialization. This is the specialization that managers consider necessary for efficiency in the use of labour. Fayol applies this principle to all kinds of work.
(2) Authority and Responsibility – The authority and responsibility are related, with the later arising from the former. He finds authority is being official and personal factor. Authority is generally derived from manager’s position and because of manager’s personal competency to solve problems in the organisation. Responsibility arises out of assigning the work.
(3) Discipline – Discipline is the obedience, application, energy, behaviour, and outward mark of respect shown by employees. It also implies compliance with organisational directives and rules, orders and instructions of superior and to co-operation with fellow workers. Fayol observed that discipline is what leaders make it. He declared that discipline requires good superiors at all levels.
(4) Unity of Command – Unity of command means that employees should receive orders from one superior only. The principle is useful in the clarification of authority-responsibility relationships. It helps in maintaining discipline, controlling their activities, fixing responsibility and not allows overriding their track.
(5) Unity of Direction – Unity of Direction means one unit and one plan. Each group of activities with same objective must have one head and one plan. It relates to the organisation of the “body corporate” rather than to individual. All activities of the organisation should be directed towards a definite way.
(6) Subordination of Individual to General Interest – Organisation’s interest is above the individual interest. And when there is conflict between the two, the common interest must prevail or management must reconcile them.
(7) Remuneration – Employees should be paid fairly and reasonably in accordance with their contribution. Remuneration and method of payment should be fair and afford the maximum possible satisfaction to employees and employer.
(8) Centralization – Fayol refers to the extent to which authority is centralized or decentralized. This pattern is determined by individual circumstances and should be based on optimum utilization of all faculties of the personnel. Centralization refers to the reservation of authority at the top level. But he referred that how much authority is dispersed or concentrated to achieve the objective effectively.
(9) Scalar Chain – These should be clear line of authority from the top level to the lowest level, while not to be departed from needlessly. This should be short-circuited only in special circumstances when its rigid following would be detrimental to the organisation. It is known as scalar chain because all employees are attached to it in the relationship of superior and subordinate.
(10) Order – This is essentially a principle of organisation in the arrangement of things and people. Human as well as material resources should be in their prescribed proper place and order.
(11) Equity – Employees should be assured to be treated on the basis of principle of equality, fairness and impartiality. Loyalty and devotion should be elicited from personnel by a combination of kindness and justice on the part of managers when dealing with subordinates.
(12) Stability of Tenure – Stability should be provided to employees accustomed to new work and succeeding in doing it. Fayol finds that unnecessary tenure is both the cause and effect of bad management.
(13) Initiative – Employees should be provided an opportunity as to develop and use initiative for solving work-related problems. Initiative increases zeal and energy on the part of human beings. Fayol exhorts managers to “sacrifice personal vanity” in order to allow to do it.
(14) Team Sprit – It emphasizes the need for team work and the importance of communication in obtaining it. It implies to build team spirit among the employees so that they work with proper mutual understanding as to make their respective contribution for achieving goals.
Elements of Management:
Fayol regarded the elements of management as its functions — planning, organising, commanding, coordinating and controlling.
Fayol perceived that management should be viewed as a process consisting of five elements:
(i) Planning;
(ii) Organising;
(iii) Commanding;
(iv) Coordinating;
(v) Controlling.
He observes that planning is the most important function and a failure to plan properly leads to inefficiency in the organization. Creation of organizational structure and commanding is necessary to execute the plan.
Coordination integrates the activities, controlling asks whether everything is proceeding according to plan. Fayol had emphasized that these principle is applicable everywhere. Since all the organisations require managing, it follows that formulation of a theory of management is necessary for effective teaching of the subject.
Fayol contributions to management thoughts are valuable. Fayol provided a conceptual framework for analyzing the managerial job. Fayol isolated and analyzed management as a separate discipline Fayol provided the management function and gave a universal shape. Fayol developed function principles to be used as guides to managerial action, and made a clean distinction between operative and managerial activities of business.
Still, Fayol’s theories retain much of its force. Many of the concept and practices are taken for granted by managers now. The principles have the potential to comprehend and cope with the growing complexity of organizations to the extent them to bring order, structure and certain through rules, regulations, policies and practices.
Through the proponents of management process approach have made significant contribution, their work suffers from the following limitations:
(i) Not Properly Defined – In the words of Herbert Simon “administrative theory suffers from superficially over simplification and back of relation,” Some of the concepts have not been properly defined. There is also back of unanimity about the various items such as management and administration, commanding and directing etc.
(ii) Lack of Empirical Evidence – The principles are based on personal experience and limited observations. They are generalizations and lack of empirical evidence. They have not been verified under controlled scientific conditions. Some of them are contradictory. The theory does not provide guidance as to which principle should be given precedence over the other.
(iii) Loss Appropriate in Today’s Environment – Fayol theory was relevant when organizations generated in a stable and predictable environment. It seems less appropriate in the turbulent environment of today. For example, present day managers cannot depend entirely on formal authority and must use persuasion to get work done. Similarly, the theory of organization as power center, do not recognize the role of a democratic form of organization.
(iv) Objections on Universality – The Administrative theory profounders consider their principles to be universal in nature. But many of the principle have failed to deliver the desired results in the changing situation.
In spite of these limitations, Fayol made a unique and outstanding contribution to the management theory.
iii. Bureaucratic Approach of Organisation:
The next important form of classical approach is bureaucratic approach of organization. This contribution has been given by a German sociologist Max Weber. This particular form of organisation is well known in government and military organizations. Every type of organization possesses some features of bureaucracy in some form; that is ranging between, ‘Line organizations’ to ‘free form organisation’.
It aims at high degree of precision, efficiency, objectivity and rationality in the organization to make it more efficient. Weber’s theory recognizes rational-legal authority as the most important in the organisation. However, Weber’s contention that there are three types of legitimate authority in the organization – (i) Rational legal authority; (ii) Traditional authority; (iii) Charismatic authority.
Weber’s contention is based on the display of rational legal authority.
The model of bureaucracy suggested by Weber is based on the following features:
(i) Division of Work – It implies to divide and assign activities to various employees on the basis of their abilities, skills and aptitudes to get the benefit of specialization. Work should be divided and assigned to each employees in the organization to achieve high degree of precision,
(ii) Hierarchy of Authority – The bureaucratic structure is hierarchical in nature. All employees in bureaucratic organization are attached to hierarchy of authority which is rational and legal in nature.
(iii) Rigidity in Rules and Regulations – Management standardizes operations and decisions. Management prescribes procedure and set rules and regulations in bureaucratic organization to regulate and control working behaviour of employees. They must be in compliance with procedures and framework of rules.
(iv) Impersonality – The decisions are entirely governed by rules and regulations and are totally impersonal. The employees have very formal and functional relationship among them. They have the official relationship.
(v) Technical Competence – Human resources in the organisation are employed or selected on the basis of technical competence, that is, what they know about the job. It is on the basis of job requirements; they are selected and placed in the organisation.
Weber’s ideal bureaucracy has been designed to bring rationality and predictability of behaviour in the organisation. It reduces subjectivity, because people have impersonal and formal relationship and they have to comply with rules and regulations. Hierarchy of authority also helps to maintain discipline. Division of labour leads to specialization and rationality brings effectiveness in decision making.
This form of organisation helps to gain the following advantages:
(i) Rationally efficient form of organisation,
(ii) Reduces subjective judgement,
(iii) Specialization,
(iv) Effective decision-making,
(v) Consistency of actions,
(vi) Allocation of tasks according to competency, and
(vii) Maintaining discipline in the organisation.
However, this approach is not free from negative connotations.
These are as follows:
(a) Bureaucratic model does not consider informal organisation and does not prescribe personal relationship. So, this is insensitive to the needs of the individual.
(b) This Theory is based on rationality perhaps finds very limited applicability in practice and often it becomes the epitome of inefficiency.
(c) Bureaucratic organisation encourages red-tapism, inordinate delay in decision-making, goal displacement and finally lack of initiative and positive motivation may result in inefficiency in such organisations.