Scientific Management was first described by Frederick Taylor in the late 19th century. Its relevance to modern day management is widely debated in academic circles. In this essay, I will address the question of whether Scientific Management has a place today, in a 21st Century Knowledge Economy, or whether it belongs to a ‘different time and place. I will argue that much of modern management practice is derived from Taylor’s theories and that in this sense his work is very relevant.
Next, I will examine the context in which Taylor developed his principles and contrast this with the contemporary context.
Then I will evaluate the relevance of each of Taylor’s 4 Principles to today, with help from a case study of the NUMMI car manufacturing plant. Finally, I will examine the modern forms of Scientific Management, and what the future holds. Standing on the Shoulders of Giants: The Academic Contribution of Scientific Management “Every method during these past hundred years that has had the slightest success in raising the productivity of manual workers – and with it their real wages – has been based on Taylor’s principles.
Taylor’s Scientific Management played a crucial part in the formation of management as an academic discipline. Many of our modern systems are built on the foundations laid by Scientific Management and elements of this are still clearly visible in modern business practice. Before Taylor’s ideas, business management was not taught or even considered a discipline. It was seen as a matter of personal style and that there was no ‘one best way’. Taylor challenged this idea and laid the foundations for management to be studied and evolve.
He believed that management should e trained and qualified. Harvard, one of the first universities to offer a degree in business management in 1908, based its first-year curriculum on Taylor’s scientific management. Scientific Management influenced many thinkers, including James McKinsey, founder of the consultant firm bearing his name. McKinsey built on Taylor’s ideas and advocated budgets as a means of accountability and measuring performance of managers.
Today the McKinsey consulting firm is one of the prime contributors to management thinking; hey believe that Scientific Management is the future, an idea which will be contested later in this essay. “Before scientific management, such departments as work study, personnel, maintenance and quality control did not exist. ” (Accel-Team) Taylor’s philosophy was important in the development of principles of management by theorists. Scientific Management advocated the division of labour, the separation of planning from operations, clear delineation of authority and the use of incentive schemes for workers.
Taylor greatly contributed to the analysis of work design and gave rise to method study, including his time studies, which are described later in this essay. Management literature has taken many new twists since Taylor’s day, with Drucker coining the term “Knowledge Workers” in 1959. Drucker’s book Landmarks of Tomorrow, describes the declining importance of manual labour. This marked a need to move away from Scientific Management, a system based on physical standardised tasks.
In 1980, management evolved further away from SM when Richard Hackman and Greg Oldham argued that workers need meaning and responsibility in their work to perform well, in their book Work Redesign. This idea contrasted with the disregard to the worker’s emotions and humanity in SM. The Context of Scientific Management: Does the Purpose It Was Developed for Have Any Relevance Today? Scientific Management was designed with physical labour in mind. Taylor was inspired by what he observed in the steel industry, and developed a style of management which could be applied to the construction, processing and train industries among others.
Today, tertiary activities form the majority of the economy in developed economies. Taylor’s system was designed in a time when secondary activities were just replacing primary activities as the largest sector, and tertiary activities were hardly developed at all. From this comes the argument that today we have moved into a knowledge economy and a new style of management must replace the now obsolete Scientific Management which was designed for standardized physical tasks. Gary Hamel terms this new style ‘Management 2. 0’.
Taylor developed SM to counteract phenomenon of soldiering which he encountered in the steel industry. The reasons for soldiering were as follows:
“1. The almost universally held belief among workers that if they became more productive, fewer of them would be needed and jobs would be eliminated. 2. Non-incentive wage systems encourage low productivity if the employee will receive the same pay regardless of how much is produced, assuming the employee can convince the employer that the slow pace really is a good pace for the job. Employees take great care never to work at a good pace for fear that this faster pace would become the new standard. If employees are paid by the quantity they produce, they fear that management will decrease their per-unit pay if the quantity increases. 3. Workers waste much of their effort by relying on rule-of-thumb methods rather than on optimal work methods that can be determined by scientific study of the task. ” (NetMBA, Business Knowledge Center) Soldiering is not a common practice in knowledge economies.
The problem that Taylor developed his principles around are from a ‘different time and place’ as these three reasons are largely non-existent now. The first reason for soldiering is no longer a problem because today incentive wage systems encourage high productivity through bonuses. Workers believe high productivity will result in promotion rather than jobs being eliminated. In the successful NUMMI car manufacturing plant a no layoff policy was employed to ‘eliminate workers’ fear that they are jeopardizing jobs every time they come up with an idea to improve efficiency. ’(Adler)