Rainey, Chapter 2

1. Understanding and Managing
Public Organizations
Chapter 2
Understanding the Study of
Organizations: A Historical Overview

2. Historical Review
• Major developments in research, theory, and thinking about
organizations and management have taken place over the past
century.
• Theories about motives, values, and capacities have evolved.
• Theories are not impractical abstractions but frameworks of ideas
that play a key role in trends, practices, and so on.
• Historical overview illustrates generic themes and also sets up
controversy for debate about distinctiveness.
• Managers need to be aware of key terms used in classic literature
(Theory X, Theory Y, span of control).

3. Systems Metaphor
• Early classical approaches emphasized single form and one
best way.
• Recent perspectives emphasize a variety of forms that can be
effective under different conditions or contingencies. There is
not one best way.
• Trend borrows from system theory.
• Systems in nature have commonalities, which provide avenues for learning and
common language.

4. Classical Approaches to Understanding
Organizations
• Frederick Taylor and Scientific Management
• Time motion studies
• Increase in workers’ well-being through productivity
• Highly impersonal

5. Classical Approaches to Understanding
Organizations
• Max Weber: Bureaucracy as an Ideal Construct
• Advanced organizations are grounded in rational-legal form of
authority and are superior.
• Weber defined the basic characteristics of a good bureaucracy.
• Bureaucracies can develop problems of accountability.

6. The Administrative Management School:
Principles of Administration
• Sought to develop principles of administration for all
organization form
• Ideas reflected in Gulick’s POSDCORB and
Mooney’s “Scalar Principle”
• Emphasis on hierarchy and specialization
• Division of work based on task, geographic location,
interdependency of work processes
• Coordination of work
o Span of control
o One master
o Technical efficiency
o Scalar principle

7. Reactions, Critiques, and New
Developments
• The Hawthorne Studies
• These are widely regarded as the most significant demonstration
of the importance of social and psychological factors in the
workplace.
• An experiment on the physical conditions (lighting) altered the
social situation.
• Employee output is also a function of attention being part of the
experiment.
• This is called the “Hawthorne Effect.”

8. Chester Barnard and Herbert Simon
• Chester Barnard
• Barnard wrote The Functions of the Executive (1938)
• He studied the inducements-contributions equilibrium.
• Incentives include more than money. Employees are also
motivated by such factors as power, prestige, and self-
fulfillment.
• The “executive” or manager has a key role in inducing
behavior through communication and persuasion.

9. Chester Barnard and Herbert Simon
• Herbert Simon
• Simon made many contributions to the field, but his 1947 PAR
article typifies his reaction to management thinking of the time.
• “The Proverbs of Administration” critiques four then-accepted
principles of public administration that lead to efficiency:
• Specialization
• Hierarchy of command
• Limited span of control
• Group workers according to purpose, process, clientele, and place
• Simon was also concerned with complex decision making and
the assumption that humans are fully rational. He contended that
administrators “satisfice” rather than maximize.

10. Social Psychology, Group Dynamics, and
Human Relationships
• Kurt Lewin’s Force Field Analysis
• Humans maintain a quasi-stationary equilibrium in their
attitudes and behaviors that results from a balance of
forces pressing for change.
• Change occurs in phases:
• Unfreezing
• Changing
• Refreezing
• (1951) Social Psychology and Group Dynamics
• Lewin’s model becomes the conceptual frame for organizational
development.

11. The Human Relations School
• Maslow’s “Needs Hierarchy”
• Five major categories of needs (bottom to top)
Physiological
Safety
Love
Self-esteem
Self-actualization

12. The Human Relations School
• Douglas McGregor
• (1957) “The Human Side of the Enterprise”
• Distills the contending traditional (authoritarian) managerial
philosophies into Theory X and Theory Y
• “X” employees basically lazy and resistant to change
• “Y” employees capable of self-motivation
• What implications do these two views have for
management?

13. Open Systems Approaches and
Contingency Theory
• Joan Woodward
• She conducted research on the classical principles of
management in England between 1955 and 1964.
• In her survey of one hundred firms in south Essex, she
was able to link organizational structure to technology.
• She found that bureaucracy was the best form of
organizational structure for routine operations.
• On the other hand, temporary work groups,
decentralization, and emphasis on interpersonal
processes worked best for nonroutine operations.

14. Open Systems Approaches and
Contingency Theory
• Burns and Stalker
• “The Management of Innovation” (1961)
• One of the first instances in which the environment is
considered an important variable of the organization
equation
• Distinguishes mechanistic and organic systems
• Found that mechanistic organization was appropriate for
stable conditions while the organic type was better suited
to changing conditions

15. Open Systems Approaches and
Contingency Theory
• Lawrence and Lorsch
• In 1967 recognized the importance of the environment in
organizations—introduced the concepts of differentiation and
integration
• Found that firms performed best when the differences between
units were maximized, as long as the integrating mechanisms
were neither strongly bureaucratic nor laissez-faire

16. Open Systems Approaches and
Contingency Theory
• James Thompson
• “Organizations in Action” (1967)
• Thompson sought to close the gap between open and
closed systems theories by suggesting that organizations
deal with uncertainties in their environment by creating
specific elements to cope with the outside world, while
other elements are able to focus on the rational nature of
technical operations.
• Dominant coalitions tend to set up closed systems,
conditional and rational decision processes.
• As complexities and uncertainties increase, organizations
adapt by adopting more flexible and decentralized
structures and procedures.

17. Open Systems Approaches and
Contingency Theory
• Peter Blau and colleagues
• (1971) Conducted a series of studies showing that organizational
size has an important relationship to structure
• New Topics
• TQM (Demming and Juran)
• Organization behavior
• Organization culture
• Diversity in organizations

18. The Quiet Controversy over Distinctions
• The analysts in the historical review either concentrated
on industrial organizations or sought to develop generic
concepts and theories that applied to all organizations.
• There are still gaps in the literature, and the issues still
tend to be oversimplified.
• The next chapter turns to the challenge of formulating
definitions and drawing distinctions.