Organizations the First Prominent Theory

¶ … Organizations

The first prominent theory in the history of modern management studies was that of scientific management, as espoused by Frederick Taylor. Taylor was attempting to render human beings as productive as possible in a scientific fashion. Workers were treated like cogs in a machine. Managers would "scientifically select, train, and develop each worker rather than passively leaving them [the workers] to train themselves" (Frederick Taylor and scientific management, 2013, Net MBA). Worker input was viewed with hostility, and the main obligation of workers was to be as productive as possible and to make as many objects as possible for consumers. Taylor took a highly mechanistic view of organizational development.

Gradually, the field of management began to give greater consideration to the question of how to motivate workers. Peter Drucker was a pioneer in developing what is now considered the core principles of modern managerial theory. "He was the first to assert -- in the 1950s -- that workers should be treated as assets, not as liabilities to be eliminated…He originated the view of the corporation as a human community" (Drucker: The father of management theory, 2013, Success.). Drucker was thus the first to value the ability of workers to make a contribution to the organization as a whole, versus suspicious entities that might possess free will. Drucker also stressed the need for organizations to be customer-driven and to ask themselves what unique values they provided to the persons they were ultimately trying to get to use their product or service. However, during this era there was still a sharp division between unions and management in terms of the organizational hierarchy.

Drucker's emphasis on the emotional components of motivational workers gave rise to a variety of organic situation-based leadership theories which stressed how various psychological factors could significantly influence worker motivation. For example, Hershey-Blanchard situational leadership theory "states that instead of using just one style, successful leaders should change their leadership styles based on the maturity of the people they're leading and the details of the task" and that there is no single, optimum style of management -- telling, selling, participating, and delegating may all be acceptable, depending on organizational needs (Hershey Blanchard situational leadership theory, 2013, Mind Tools).

Today, modern organizations regard themselves as 'open' systems, capable of taking in information from the environment, including customer feedback and also employee input about how to optimize organizational processes. While Taylor viewed organizations by necessity as closed entities -- adhering to a 'perfect' system and hostile to any attempts to deviate from the course -- new models see openness as a virtue, particularly because customer needs and the larger economic environment are in a constant state of flux. Most organizations today are ambidextrous and draw from a series of different models.

Q2. What is the difference between a mechanistic and organic organization in terms of their structure?

A mechanistic organization is formalized and centralized and focuses upon reducing costs so it can profit off of its output. It takes a very technical view of the production process. Authority is centralized and highly controlled. In contrast, organic organizations focus on generating revenue (i.e., making a profit) and this focus leads them to stress the need to create innovative products. Employees are valued for their creative talents and are given free rein to generate new ideas.

An excellent example of a mechanistic organization is that of Wal-Mart. Wal-Mart boasts that it offers consumers the lowest possible prices, all of the time. The focus is not on innovative products -- most of the items can be found in other stores -- but upon keeping prices low. Wal-Mart stores are run in a highly controlled fashion, with little variation between stores even in terms of how customers are greeted. Employees are paid little and are treated as expendable -- their low wages enable prices to remain rock-bottom. "Wal-Mart customers want the lowest possible prices on the things they use every day. And Wal-Mart delivers, with reliably rock-bottom pricing and fantastic product variety. To afford it, the company under-delivers on other parts of the retail experience, such as sales support and ambience" (Frei & Moriss 2012). Wal-Mart has very little interest in optimizing the customer buying experience, much less listening to disposable employees about how to improve the store. It has been wildly successful by keeping things cheap, despite a great deal of media criticism of its store policies. The span of control of management is very direct to make this model work and is highly formalized and centralized. Wal-Mart's model has worked, thanks to its sheer size, but smaller budget retailers have struggled if their ability to compete on price is shaken, given they have little else to offer.