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Scientific Management Theory                                                                                             

 Frederick W. Taylor developed his Scientific Management Theory while he was working for a steel factory. There he noticed that most of the workers were under-producing their daily capacity causing a tremendous loss in terms of production. So, for this purpose Taylor developed this theory, which he studied the best ways to perform tasks, carefully match each worker with each work, closely supervise workers and use reward and punishment as motivators and gave the tasks of planning and control to the management. 

 

Bureaucratic theory                                                                                                                     

Max Weber (1947) expanded on Taylor's theories, and stressed the need to reduce diversity and ambiguity in organizations. The focus was on establishing clear lines of authority and control. Weber's bureaucratic theory emphasized the need for a hierarchical structure of power. It recognized the importance of division of labor and specialization. A formal set of rules was bound into the hierarchy structure to insure stability and uniformity. Weber also put forth the notion that organizational behavior is a network of human interactions, where all behavior could be understood by looking at cause and effect. 

 

Contingency Theory                                                                                                                    

Classical and neoclassical theorists viewed conflict as something to be avoided because it interfered with equilibrium. Contingency theorists view conflict as inescapable, but manageable. 

Chandler (1962) studied four large United States corporations and proposed that an organization would naturally evolve to meet the needs of its strategy -- that form follows function. Implicit in Chandler's ideas was that organizations would act in a rational, sequential, and linear manner to adapt to changes in the environment. Effectiveness was a function of management's ability to adapt to environmental changes. 

 

Systems Theory                                                                                                                            

Systems theory was originally proposed by Hungarian biologist Ludwig von Bertalanffy in 1928. The foundation of systems theory is that all the components of an organization are interrelated, and that changing one variable might impact many others. Organizations are viewed as open systems, continually interacting with their environment. They are in a state of dynamic equilibrium as they adapt to environmental changes.

 

Organizational Structure                                                                                                             

Until recently, nearly all organizations followed Weber's concept of bureaucratic structures. The increased complexity of multinational organizations created the necessity of a new structure that Drucker called "federal decentralization". In federal decentralization, a company is organized so that there are a number of independent units operating simultaneously. "Each unit has its own management which, in effect, runs its own autonomous business." This structure has resulted in large conglomerates which have diversified into many different fields in order to minimize risk.

The project management organizational structure has been used effectively in highly dynamic and technological environments (French, Kast and Rosenzweig, 1985). The project manager becomes the focal point for information and activities related to a specific project. The goal is to provide effective integration of an organization's resources towards the completion of a specific project. Implementing a project management approach often involves dramatic changes in the relationships of authority and responsibility.

 

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