Classical Management Theory

It was H. Fayol who developed the classical theory of management as a way of giving a structural approach to the organization, as opposed to the analytical organization that Taylor proposed.

In this way, and starting from the fact that the company could be divided into 6 functional groups:

– Techniques

– Commercial

– Financial

– Security

– Accounting and budgeting

– Administrative

Fayol breaks down the organization into a number of administrative elements, such as

– Forecasting: taking into account the future, having a vision.

– Organizing: establishing the basis between the material and the people.

– Commanding: directing people towards the vision and mission.

– Coordinate: harmonize all the efforts carried out by the different members of the organization.

– Controlling: checking that everything happens as planned and established.

Fayol determined that the administrative functions correspond to all levels of the organization and not only to the top management. He also concluded that:

– The main thing for a worker was his technical capacity.

– As one moves up to higher positions in the hierarchy, the technical must be replaced by the administrative.

Principles of classical theory

– Work must be divided to produce more, better and with less effort. Automation allows for improved training and quality in the execution of the task.

– Authority is based on the right to give orders. Knowing how to differentiate between hierarchical authority and functional authority based on the capacity and experience of the worker.

– Discipline. It is the capacity to act according to the orders given.

– Unity of command. Each person must receive orders from only one person.

– Remuneration. A fair remuneration must be received and adapted to the effort and the task.

Theory of human relations

Also known as humanist theory, it tries to establish a turn where the mechanical vision of the worker is modified. It seeks to favor relationships between people, flexibility of action and reconsideration of all the rigid principles established so far.

The appearance of this humanist conception implies a sudden change in the way of understanding administrative thought, reducing the weight of the mechanical and focusing on giving priority to the development of the different spheres of the human being.

We can situate the causes of the emergence of this movement in

– The need to humanize administration

– To develop and empower the different spheres of people.

It was Elton Mayo who, with his experiments in the Western Electric, concentrated a greater transcendence and protagonism in the development of this theory. Thus, Mayo’s research focused on determining the existence of a relationship between factory lighting and efficiency when performing the task. The research was carried out in four stages:

First stage. The different performance under different lighting conditions was analyzed, with negative consequences and greater fatigue appearing in workers with worse lighting conditions.

Second stage. The influence of different working conditions, such as rest times, working hours, form of remuneration, was analysed. Better performance was found in those with better working conditions.

Third stage. Interviews were carried out to find out which factors, apart from the ones that were evident, influenced the activity. One of the conclusions of this stage was the appearance of two types of relationships, formal and informal.

Fourth stage. The objective was to analyze the way in which the behavior between groups of workers influences the activity, seeing how spontaneous relationships arise between people who are different from those officially established.

From these investigations, it is deduced that:

– People’s productivity is not only conditioned by their physical capacity, but also by the environment around them.

– People do not react to the administration individually, but as members of a collective in which they are immersed.

– They expose the human vision and conception as a social being.

– People’s behaviour is based on a scale of needs corresponding to the entire human sphere.

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