"Wealth in the new regime flows directly from innovation, not optimization; that is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown."
Let's focus closely on the modern development of leadership thought. According to Georgia Sorenson, author of An Intellectual History of Leadership Studies: The Role of James MacGregor Burns, the word "leader" first appeared in the 1300s and stemmed from the root leden, meaning "to travel" or "show the way." Leadership was defined five centuries later. Traditionally, managing both the technical and human components has posed problems for leaders for centuries.
Between 1945 and 1960, leadership scholars spent more of their effort on empirical research; however, from the 1970s onward, this research became theory driven. In developing strategies for this problem, researchers and practitioners have either adopted a "scientific" or "behavioral" approach. This fact is where the school of management thought evolved. The school of management provides a theoretical framework for studying leadership thought.
Over the decades, management gurus have tried to organize and classify this enormous information related to management, and this is how the schools of management thought started. We will discuss the following schools: (a) the classical school, (b) the behavioral school, (c) the quantitative or management science school, (d) the systems school, and (e) the contingency school. Let's examine these schools more closely.
The classical school concept began in the 1800s. During that time, over 90% of Americans lived rurally. Between 1870-1900s, rural areas doubled and urban areas tripled. With the transition from a rural to industrial society, leaders lacked a process to motivate the unskilled workforce.
Conversely, the Industrial Revolution brought new jobs, mostly filled by immigrants. Although the Mid-19th Century America was a land of opportunity, workers were living in awful conditions while the industrial elites benefited. This period, then, created a host of new advances and new problems for organizational leaders.
The classical school, which is the oldest formal school of management thought, generally focused on ways to manage work and organizations more efficiently. It can be further grouped into three areas which are scientific management, administrative management, and bureaucratic management. We will briefly discuss these areas and the leading advocates.
Scientific Management began in the 1880s. Previously, management decisions were viewed as arbitrary, and workers operated at a slow pace. Scientific management was developed to create a systematic method to improve efficiency. The key proponents were Frederick W. Taylor, Frank and Lillian Gilbreth, and Henry Gantt.
Administrative Management began in the 1940s. Unlike scientific management, administrative management focused largely on jobs and work at the individual level of analysis. It provided a more general theory of management. The key proponent was Henri Fayol.
Bureaucratic Management began in the 1920s. Earlier organizations were personality- and relationship-driven. A proposed form of organization called bureaucratic management was characterized by division of labor, hierarchy, formalized rules, impersonality, and the selection and promotion of employees based on ability. The key proponent was Max Weber.
When the behavioral concept began in the 1930s, there was a global depression that brought an abrupt shift from the fun-loving lifestyles of the Roaring 20s. As Socialists proclaimed the death of capitalism, Adolf Hitler was rising to power in Germany.
Technology was still progressing as global communication increased. Roosevelt's New Deal brought enormous governmental intervention into societal problems. Unfortunately, it was also the beginning of World War II in 1939.
As a result of perceived weaknesses in the assumptions contained in the classical school, the behavioral school of management thought was created. Some felt that the classical school emphasized efficiency while disregarding the aspect of human behavior in organizations.
The behavioral school focused on trying to understand the factors that affect human behavior at work. The behavioral school was two subgroups, human relations and behavior science.
Human Relations can be traced to the Hawthorne Experiments in 1924 and concluded in the early 1930s. Two significant discoveries from the Hawthorne Experiments were found: a) workers' attitudes are associated with productivity and b) the workplace is a social system with informal group influences.
According to the human relation school, the manager should possess critical skills for diagnosing the causes of human behavior at work so that he could effectively lead employees. Some of the best-known contributors include Mary Parker Follett, Chester Barnard, Abraham Maslow, and Elton Mayo. Today, this school has influenced management theory and practice in such areas as applied psychology.
Behavior Science emerged in the 1950s and 1960s . Behavior science was a natural progression of the human relations school of thought. It focused primarily on applying conceptual and analytical methods to the problem of understanding and predicting human behavior in the workplace.
Some of the major contributors include Douglas McGregor, Frederick Herzberg, and Ralph Stogdill. This school has contributed to the study of management by focusing on several areas such as personality, values, and leadership.
When the quantitative concept began, it was a decade dominated by World War II, which was widely viewed as the most destructive war in history. This decade marked the transition period between the radical 1930s and the conservative 1950s.
One the economic front, the Marshall Plan, implemented by the US, gave billions of dollars for reconstructing war-devastated economies. Technology was being designed for major destruction. The first nuclear bomb was created, which dramatically changed international relationships.
This school emerged in the 1940s. The quantitative school objective was to increase the quality of managerial decision-making by applying mathematical and statistical approaches.
This school was derived from the scientific management. The quantitative school was in three subgroups: management science, production, and operations management.
Management Science developed during World War II as strategists tried to solve war related problems. Management Science utilizes mathematical and statistical approaches to solve management problems.
Management Information Systems and Management Science are interconnected. The key proponent was George Dantzig. Today, this approach is being used in industry. An example would be a decision support system.
Production and Operations Management
This school began in the 1940s. It focuses on operation and control of the production process. Its roots were similar to management science because it resulted from the war. Operational management targets productivity and quality of an organization.
The key proponent was W. Edward Deming. Some of the areas of study include computer integrated manufacturing and just-in-time inventory systems.
When the systems concept began in the 1950s, the decade echoed the return of conservative values
and the return to the 1920s-type consumer society. The 1950s marked a rapid rise in the conflict with the Eastern Bloc and the Soviet Union.
The Cold War generated the Arms Race, Space Race, McCarthyism, and the Korean War. It also marks
the return of the GIs and a baby boom. There was a high rate of unionization in industry and most of the technology supported the Cold War.
During this time, most of the earlier internal American problems such as women's rights and civil rights were now suppressed as Americans settled into suburban life; however, suppressing these social issues would have a significant impact on the 20th Century.
This school began to have a strong impact in the 1950s. The system school focused on understanding the organization as an open system that transforms inputs into output.
Managing techniques that would allow managers to relate different specialties and parts of the company to one another as well as external factors were used. In the systems theory, an organization is defined as a system with objectives. The school is built on the works of Ludwid von Bertalanffy, a biologist.
When the contingency concept began in the 1960s, the decade was a time of great social changes in the country. Many of the changes were reflective of the demographic changes brought by the baby boom generation, height of the Cold War, and dissolution of the European colonial empires.
The Social revolution, civil rights movement, anti-War movements, human rights movement, and the Counterculture movement placed America in an unstable position. During this timeframe, protectionist, command, and mixed economies reached a peak.
This school began in 1960s. The contingency school focused on applying management principles and processes primarily dictated by each unique situation. In the contingency theory, a leader's ability to lead is contingent upon various situational factors. Its application has been on management issues such as organizational design, job design, motivation, and leadership style.
A few of the major contributors are Fred Fiedler, Joan Woodward, and Paul Lawrence. The Contingency Theory states that the leader's ability to lead is contingent upon various situational factors.
Obviously, these schools made a significant contribution to modern day management, and these early results provide a blueprint for the current leadership paradigms in organizations.
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