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OB/U1 Topic 3 Historical Development of Organizational Behavior

In 1776, Adam Smith advocated a new form of organisational structure based on the division of labour. One hundred years later, German Sociologist Max Weber introduced the concept about rational organisations and initiated the concept of charismatic leadership.

Though the origin to the study of Organisational Behaviour can trace its roots back to Max Weber and earlier organisational studies, it is generally considered to have begun as an academic discipline with the advent of scientific management in the 1890’s, with Taylorism representing the peak of the movement. Thus, it was Fredrick Winslow Taylor who introduced the systematic use of goal setting and rewards to motivate employees that could be considered as the starting of the academic discipline of Organisational Behaviour.

Proponents of scientific management held that rationalising the organisation with precise sets of instructions and time-motion studies would lead to increased productivity. Studies of different compensation systems were also carried out to motivate workers.

In 1920’s Elton Mayo an Australian born Harvard Professor and his colleagues conducted productivity studies at Western Electric’s Hawthorne Plant. With this epoch making study the focus of organisational studies shifted to analysis of how human factors and psychology affected organisations. This shift of focus in the study of organisations was called the Hawthorne Effect. The Human Relations Movement focused on teams, motivation, and the actualisation of goals of individuals within organisations. Studies conducted by prominent scholars like Chester Barnard, Henri Fayol, Mary Parker Follett, Frederick Herzberg, Abraham Mas low, David Mc Cellan and Victor Vroom contributed to the growth of Organisational Behaviour as a discipline.

In the 1960’s and 1970’s, the field was strongly influenced by social psychology and the emphasis in academic study was quantitative research. An explosion of the orising, bounded rationality, informal organisation, contingency theory, resource dependence, institution theory and population ecology theories have contributed to the study of organisational behaviour.

Historical development of Organisational behaviour

Various Historical Concepts

  1. Industrial Revolution: It has only been since the Industrial Revolution of the nineteenth century that relatively large number of individuals have been required to work together in manager- subordinate relationships. Prior to this many of the large organisations that did exist, were military ones in which the authority of the leader was supreme and practically unquestioned, since membership was not voluntary.

Behavioural problems were relatively easy to deal with under these conditions. It is certainly no accident that much of our current knowledge about human behavior has been derived from organisations in which influencing behaviour consists of more than just giving orders.

Famous industrialist like William C Durant, Henry Ford, Andrew Carnegie, and John D Rock feller were men of brilliant managerial qualities. They possessed the managerial qualities necessary for the initial stages if industrialization. However, when the industrial revolution began to mature and become stabilized, this approach was no longer appropriate.

  1. Scientific Management: The great industrialist was primarily concerned with overall managerial organisation in order for their companies to survive and prosper. The scientific management movement around the turn of the century took an arrower, operations perspective. Yet, the two approaches were certainly not contradictory. The managers in both cases applied the scientific method to their problems and they thought that effective management at all levels was the key to organisational success.

Fredrick W Taylor(1856 – 1915) is the recognized father of scientific management.

Taylor started scientific management in his time-and-motion studies at the Midvale Steel Company in the early 1900’s. As an industrial engineer, he was concerned within efficiencies in manual labour jobs and believed that by scientifically studying the specific motions that made up the total job, a more rational, objective and effective method of performing the job could be determined. In his early years as a foreman in the steel industry, he saw different workers doing the same job in different ways. It was his opinion that each man could not be doing his job in the optimal way, and he set out to find the “one best way” to perform the job efficiently. His argument proved to be correct and in some instances “taylorism” resulted in productivity increases of 400 percent. In almost all cases, his methods improved productivity over existing levels.

Taylor had actually shop and engineering experience and therefore was intimately involved with tools, products and various machining and manufacturing operations. His well- known metal -cutting experiments demonstrated the scientific management approach. Over a period of twenty-six years, Taylor tested every conceivable variation in speed, feed,d epth of cut, and kind of cutting tool. The outcome of this experimentation was high speed steel, considered one of the most significant contributions to the development of large-scale production.

Coupled with Taylor’s logical, rational, engineering -like approach to management was a simple theory of human behaviour: people are primarily motivated by economic rewards and well take direction if offered the opportunity to better their economic positions. Put simply, taylor’s theory stated that:

  • Physical work could be scientifically studied to determine the optimal method of performing a job.
  • Workers could there after be made more efficient by being given prescriptions for how they were to do their jobs.
  • Workers would be willing to adhere to these prescriptions if paid on “differential piece work” basis.

In addition to advocating the use of scientific means to develop the best way to do a task, Taylor argued that several other principles were important.

  1. Workers with appropriate abilities had to be selected and trained in the appropriate task method.
  2. Supervisors needed to build cooperation among the workers to ensure that they followed the designated method of work. Building such cooperation included soliciting workers’ suggestions and being willing to discuss ideas for improved work methods.
  3. There needed to be a clear division of work responsibilities. Previously, the workers planned how to approach a task, and then they executed it. Under the Taylor scheme, it was management’s job to do the task planning, using scientific methods.

Taylor’s four principles of scientific management are summarized here: –

  • Scientifically study each part of a task and develop the best method for performing the task.
  • Carefully select workers and train them to perform the task by using the scientifically developed method.
  • Cooperate fully with workers to ensure that they use the proper method.
  • Divide work and responsibility so that management is responsible for planning work methods using scientific principles and workers are responsible for executing the work accordingly.

Many have criticized Taylor’s work for dehumanizing the work place and treating workers like machines, but his overall contribution to management was significant. Although others were studying similar methods at the same general time, Taylor was one of the first totake the theory and practice of management out of the realm of intuitive judgment and into the realm of scientific inquiry and reasoning.

Taylor’s ideas on time study, standardization of work practices, goal setting, money as a motivator, scientific selection of workers and rest pauses have all proved to be successful techniques of management today. Taylor was by no means the only note worthy scientific manager. Others in the movement, such as Frank and Lillian Gilberth and Henry L Gantt made especially significant contributions.

The Gilbreths: Other major advocates of scientific management were the husband and wife team of Frank Gilbreth (1868 – 1924) and Lillian Moller Gilberth (1878 – 1972). As Frank become involved in training young brick layers, he noticed the in efficiencies that were handed down from experienced workers. To remedy the situation he proposedusing motion studies to streamline the bricklaying process. Frank also designed special scaffolding for different types of jobs and devised precise directions for mortar consistency.

On the basis of these and other ideas, Frank was able to reduce the motions involved in brick laying from 18 ½ to 4. Using his approach, workers increased the number of bricks laid per day from 1000 to 2700 with no increase in physical exertion.

Frank married Lillian Moller, who began working with him on projects while she completed her doctorate in psychology. The two continued their studies aimed at eliminating unnecessary motions and expanded their interests to exploring ways of reducing task fatigue. Part of their work involved the is olation of 17 basic motions, each called atherblig (“Gilbreth” spelled backward, with the “t” and “h” reversed). Therbligs included such motions as select, position, and hold – motions that were used to study tasks in a number of industries. The Gilbreths used the therblig concept to study tasks in a number of industries. The Gilbreths used the therblig concept to study jobs and also pioneered the use of motion picture technology in studying jobs.

Lillian’s doctoral thesis was published as a book, The Psychology of Management, making it one of the early works applying the findings of psychology to the workplace. At the insistence of the publisher, the author was lilted as L.M. Gilbreth to disguise the fact that the book was written by a woman.

Lillian helped define scientific management by arguing that scientific studies of management must focus on both analysis and synthesis. With analysis, a task is broken down into its essential parts or elements. With synthesis, the task is reconstituted to include only those elements necessary for efficient work. She also had a particular interest in the human implications of scientific management, arguing that the purpose of scientific management is to help people reach their maximum potential by developing their skills and abilities. Lillian Gilbreth ranks as the first woman to gain prominence as a major contributor to the development of management as a science.

Henry L Gantt (1861-1919): One of Taylor’s closest associates, Henry Gantt latter become an independent consultant and made several contributions of his own. The most well -known is the Gantt Chart, a graphic aid to planning, scheduling and control that is still in use today. He also devised a unique pay incentive system that not only paid workers extra for reaching standard in the allotted time but also awarded bonuses to supervisors when workers reached standard. He wanted to encourage supervisors to coach workers who were having difficulties.

The scientific managers like Taylor, Frank and Lillian Gilberth and Henry Gantt were not the first or only group that recognized the importance of the operating functions. Ahundred years earlier, Adam Smith had carefully pointed out the advantages of division of labour and in 1832, Charles Babbage, a British mathematician with some asto unding managerial insights, discussed transference of skill in his book Economy of Machinery and Manufacture.

  1. The Human Relations Movement: The second major step on the way to current organisational behaviour theory was the Human Relations Movement that began in the 1930’s and continued in various forms until the 1950’s. The practice of management, which places heavy emphasis on employee cooperation and morale, might be classified as human relations. Raymond Mills states that the human relation approach was simply to “treat people as human beings (instead of machines in the productive process), acknowledge their needs to belong and to feel important by listening to and heeding their complaints where possible and by involving them in certain decisions concerning working conditions and other matters, then morale would surely improve and workers would cooperate with management in achieving good production”.

The Human Relations Movement, popularized by Elton Mayo and his famous Hawthorne studies conducted at the Hawthorne Plant of the Western Electric Company, in many ways it remained the foundation of much of our management thinking today. Before the Hawthorne studies officially started, Elton Mayo headed a research team, which was investigating the causes of very high turnover in the mule-spinning department of a Philadelphia textile mill in 1923 and 1924. After interviewing and consulting the workers, the team set up a series of rest pauses, which resulted in greatly reduced turnover and more positive worker attitudes and morale.

Illumination Experiments: The initial experiments reflected strongly the physical orientation of scientific management, since they were designed to explore the relationship between lighting and productivity. The rational approach of scientific management predicted a positive relationship i.e., as lighting increased, productivity would increase up to a point of course. Logically, at some (high) level of illumination productivity should begin to decline, so the original experiment was designed to determine the optimal level of illumination.

The light experiments were conducted on female workers, who were divided into two groups. One group was placed in a test room where the intensity of illumination was varied, and the other group worked in a control room with supposedly constant conditions.

The results were baffling to the researchers. The researchers found no predictable relationship between lighting and output and, because the research results could not be explained by existing knowledge, the researchers were forced to find new explanation.

Further research indicated that the lack of a predictable relationship between lighting and output was related to the mental and emotional side of organisations rather than the physical, mechanistic side recognized by scientific management. Additional studies showed that economic factors, such as incentive systems, were equally poor in predicting behaviour.

Relay Room Experiments: Intrigued with positive changes in productivity some of the engineers and company officials decided to attempt to determine the causes through further studies. Accordingly, a second set of experiments took place between 1927 and 1933 known as the Relay Room experiments.

The most famous study involved five girls assembling electrical relays in the Relay Assembly Test Room, a special room away from other workers where the researchers could alter work conditions and evaluate the results. During the experiment, the girls were often consulted and sometimes allowed to express themselves about the changes that took place in the experiment. Apparently, the researchers were concerned about possible negative reactions and resistance from the workers who would be included in the experiment. To lessen potential resistance, the researchers changed the usual supervisory arrangement so that there would be no official supervisor; rather, the workers would operate under the general direction of the experimenter. The workers also were given special privileges such as being able to leave their work station without permission, and they received considerable attention from the experimenters and company officials.

In total, they were treated and recognized as individuals with something to contribute.

The study was aimed at exploring the best combination of work and rest periods, but a number of other factors were also varied, such as pay, length of the workday, and provisions for free lunches. Generally, productivity increased over the period of the study, regardless of how the factors under consideration were manipulated.

The results in the relay room were practically identical with those in the illumination experiment. Each test period yielded higher productivity than the previous one had done.

Even when the girls were subjected to the original conditions of the experiment, productivity increased. The conclusion was that the independent variables (rest pauses and so forth) were not by themselves causing the change in the dependent variable (output).

One outcome of the studies was the identification of a famous concept that ultimately came to be known as the Hawthorne effect. The Hawthorne effect refers to the possibility that individuals singled out for a study may improve their performance simply because of the added attention they receive from the researchers, rather than because of any specific factors being tested in the study. More contemporary investigations now suggest that the Hawthorne effect concept is too simplistic to explain what happened during the Hawthorne studies and that the Hawthorne effect concept itself is defective. In the Hawthorne situation, the workers likely viewed the altered supervision as an important positive change in their work environment, even though that was not what the researchers intended.

Bank Wiring Room Study

The final phase of the research programme was the bank wiring study, which started in November 1931 and lasted until May 1932. Its primary purpose was to make observational analysis of the informal work group. A group of male workers in the study provided knowledge about informal social relations within groups and about group norms that restrict output when such steps sum advantageous to the group. It also included a massive inter viewing programme (1928 – 1931) that was initially aimed at improving supervision but evolved into a means of learning what workers had on their minds and allowing them to let of steam.

The results in the bank wiring room were essentially opposite to those in the relay room.The output was actually restricted by the bank wirers. By scientific management analysis, a standard of 7312 terminal connections per day had been arrived at. This represented 2½ equipments. The workers had a different brand of rationality. They decided that 2 equipments was a “proper” days work.

The researchers determined that the informal group norm of 2 equipments represented restriction of output rather than a lack of ability to produce 2 ½ equipments. The following evidence supports this contention:

  1. The observer noted that all the men stopped before quitting time.
  2. Most of the men admitted to the interviewer they could easily turn out more work.
  3. Tests of dexterity and intelligence indicated no relationship between capacity to perform and actual performance.

Assessing the Hawthorne Studies: The Hawthorne studies have been severely criticized mainly because the studies often had major flaws (such as changing several factors at the same time) and because important data were sometimes ignored in drawing conclusions (especially in discounting the potential importance of pay).

The Human Relations Movement, like Scientific Management, is not without its short comings. Because of the nature of its findings and the resulting lessons for managers, it has been criticised as “cow Sociology” (so called because happy cows presumably give more milk). This simplistic view of the relationship between morale and productivity is something that existing research has not been able to verify.

Yet, despite their short comings, the effects of these pioneering studies were far-reaching. In strong contrast to the impersonality that characterized the classical approach, the Hawthorne studies pointed to the impact that social aspects of the job had on productivity, particularly the effect of personal attention from supervisors and relationship among group members. As a result, the focus of the field of management was drastically altered. A common interpretation of the Human Relations Movement is that managers need only treat their employees well to generate maximum productivity. This conclusion is unfortunate for two reasons.

  1. It is over simplified and therefore often inaccurate.
  2. Those who do not agree with this conclusion might be labeled advocates of poor treatment of employees – which, of course, is also false.

Quite possibly the positive but simplistic philosophy of human relations has actually hindered needed research into organisational behaviour. This does not necessarily mean that an understanding of human relations is not useful; it may have a pay off in areas other than performance, such as absenteeism, turnover etc. The influence of the human relations philosophy can be seen in many management training programmes today.

Topics such as communication, counselling, understanding people, and leadership are common ingredients in many training programmes and reflect the findings of the original Hawthorne studies. Often participants are taught that improved communications, etc., will increase morale. Unfortunately, these topics can erroneously be seen as the totality of the manager’s job, thereby increasing the probability that employee morale may increase and productivity may decrease.

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