Classical Organization Theory

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Classical Organization Theory

• More than you ever wanted to know about
  bureaucracy

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Classical Organization Theory

• BUREACRACY -- Max Weber (1916)
• To Weber, this represented an ideal or completely
  rational form of organization
• Used to describe a structure based on the
  sociological concept of rationalization of
  collective activities
• Had NONE of the negative connotations the terms
  has today (red tape, etc.)

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Key Features of Bureaucracy

• Clear division of labor each task performed by
  employees is formally created and recognized as
  an official duty (yours and no one elses).
  Specialization.
• Hierarchical arrangement of positions each
  lower position controlled and supervised by a
  higher one. Chain of Command

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Key Features of Bureaucracy

• Formal rules and regulations uniformly guide
  employee behavior. Provide continuity and
  stability to work environment. Reduce
  uncertainty about task performance.
• Impersonal relationships managers dont get
  involved in employees personalities and personal
  preferences. No emotional attachments. Provides
  for fairness.

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Key Features of Bureaucracy

• Employment based entirely on technical
  competence get job because you can do the job,
  not because of who you know. Rigid selection
  criteria. No arbitrary dismissal or promotion.

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Fayols Fourteen Principles

• Fayol French industrialist and general
  administration theorist
• Worked at same time as Weber
• Identified a set of principles of management

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And the principles are.

• Division of Labor Specialization increases
  output by making employees more efficient
• Authority Managers must be able to give orders.
  Authority and responsibility go together
• Discipline Employees must obey and respect the
  rules of the organization.

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And the principles are.

• Unity of Command every employee should receive
  orders from only ONE superior.
• Unity of Direction Each group of organizational
  activities that has the same objective should be
  directed by one manager using one plan.

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And the principles are.

• Subordination of Individual Interests to the
  General Interests the greater good. The
  organizations interests come first.
• Remuneration workers must be paid a fair wage
  for their services.
• Centralization degree to which subordinates are
  involved in decision making. What works best for
  the organization? Centralized
  management-driven. Decentralized
  subordinate-driven

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And the principles are.

• Scalar chain line of authority from top
  management to the lowest ranks. Communications
  should follow this chain whenever possible.
• Order People and materials should be in the
  right place at the right time.
• Equity Managers should be kind and fair to
  their subordinates

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And the principles are.

• Stability of Tenure of Personnel High employee
  turnover is inefficient.
• Initiative Employees who are allowed to
  originate and carry out plans will exert high
  levels of effort.
• Esprit de Corps Promoting team spirit will
  build harmony and unity within the organization.