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As industrialization advanced rapidly across the world at the turn of the twentieth century, it transformed working practices and prompted theorists to consider how best to conduct business under such changed circumstances. The theory of scientific management has its roots in the studies conducted by F. W. Taylor during this formative period (see Taylor, 1911). There is much debate in the secondary literature about the synonymy of Taylorism and scientific management, which this paper does not discuss (for further details see, Caldari, 2007; Nelson, 1992). Rather, this paper positions Taylor as the defining early influence in a continuum of scientific approaches to organizational management – all of which fall under the broader definition of scientific management and management science – that endures today. Section 1 of this paper undertakes a critical evaluation of scientific management theory before going on in Section 2 to discuss how and to what extent it is applied at the organisation, Microsoft.
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Critical Evaluation of Scientific Management Theory
Taylor was one of the first theorists to consider management and process improvement as a scientific problem and, as such, is widely considered the father of scientific management. He proposed that a business’s economic efficiency could be improved by simplifying and optimising work processes, which would, in turn, increase productivity. Taylorism, as a philosophy, was the product of a series of experiments and observations, such as time-motion studies, designed to determine the most effective and efficient way to complete a task. Its fundamental and inter-related principles can be summarised as follows:
- Using scientific method to challenge habitual working practices and to determine the most efficient way to perform specific work tasks;
- Matching workers’ capability and motivation to the task requirements and supervising them according to the established rules and procedures;
- Establishing fair performance levels and develop a pay system that rewards, and therefore encourages, over-achievement; and
- Appropriate division of responsibilities to allow managers to apply scientific management principles to plan work and ensure workers are effective.
Taylor’s work influenced a number of other contemporaneous theorists, such as Frank and Lillian Gilbreth, and, later, Henry Gantt, who also favoured empirical methods to determine the most efficient procedures. Indeed, his new scientific system of organisation was met initially with widespread support in the USA and Great Britain amongst theorists, politicians and economists alike (Nelson, 1992). However, Taylor’s scientific management was not without its critics, both at the time and subsequently. By the 1930s and 40s it had broadly fallen out of favour. The following section undertakes a critical evaluation of scientific management. It discusses the arguments of Taylorism’s detractors and also explores its legacy in popular modes of management practice today.
One of the most popular criticisms levelled at Taylorism is its perceived lack of human appreciation (Caldari, 2007). In the drive to increase physical efficiency, it considers the worker a part of the production process on a level equal to the tools s/he uses and, as such, strips him or her of all capacity to reason and act autonomously. All thinking and planning is taken over by management, and the worker’s role is reduced to the simple repetition of standardised and simplified work flows in accordance with productivity targets. By assuming that fair payment will motivate employees to perform optimally, Taylorism overlooks the individual’s subjective motivation and their need to derive personal satisfaction from their work. On the one hand, standardised work instructions have been shown to improve quality, facilitate training and reduce waste. However, on the other hand, today’s low skilled and highly rationalised roles, such as call centre or fast food jobs, workers are often characterised by high absenteeism and high turnover due to low job satisfaction. Since these are drivers of increased cost, it can be argued that the strict doctrines of scientific management actually run the counterproductive risk of increasing costs and reducing productivity.
A further point of controversy for Taylorism’s critics is the theory that scientific process will eventually identify the ‘one best way’ of carrying out a specific process of work to maximum efficiency (see Ralston, 2014). They argue that the implementation of ‘one best way’ disregards individual talents and preferred working methods, thereby alienating workers and preventing them from developing an appreciation of their place or function in the entire industrial process. This, in turn, suppresses their initiative and the potential for discovering new and innovative ways of working. Instead, opponents of Taylorism advocate a plurality of methods for increasing productivity, which should be tailored to workers’ needs. Feedback should be encouraged and decision-making shared between workers and management to engender a greater sense of participation and ownership, greater engagement, and a stronger sense of collaboration between workers and management.
In the light of the above criticisms, it is perhaps unsurprising that employees’ views of Taylorism have tended to be unfavourable. In its pursuit of efficiency and productivity, Taylor’s scientific management principles divide labour undemocratically, in such a way as to empower managers, benefit employers and lower workers’ morale. Although Taylor advocated fair assessments of working hours, productivity and pay, his theory obliges the worker to depend upon the employer’s conception of fairness, and gives the worker no voice in hiring and setting the task, in negotiating the wage rate or determining the general conditions of employment. In reality, many employers implemented Taylor’s theories only partially, using strict control, punitive measures to drive maximal output. This not only caused significant additional mental and physical strain, but also increased the potential for accidents and work stoppage (Nelson, 1992). Furthermore, workers believed down-skilling and eventual automation were responsible for growing unemployment – even if ultimately it might lead to lower prices and increased demand. They also objected to the fact that the gains of higher productivity were not shared with the workers. Rather, the major proportion was taken away by the employer in the form of higher profits. Such an imbalance of power and resultant dissatisfaction has the potential to polarise industrial relations leading to increased risks of strike action and disruption.
Although there is much to criticise about Taylorism and its early implementation, it should also be acknowledged that its advent paved the way for many of the management theories and methodologies that are followed today. The division of labour into ‘doers’ and ‘thinkers’ is a dichotomy that continues to shape the separation of strategy and implementation in most organisations (Kanigel, 1997, Stoney, 2001)). Likewise, in most organisations management and labour continue to co-exist in an uneven relationship which privileges intellectual work over manual skills. Likewise, the rationalization of processes into discrete, unambiguous units with defined work instructions has laid the foundations for knowledge transfer, automation and eventual offshoring (Drucker, 1981) – strategies that continue to be implemented in many multinational corporations today as management theory, and management itself, evolves with changing times (Witzel and Warner, 2013). Incentive schemes are still widely recognized as an effective means to encourage higher performance and are a standard component of most sales compensation packages. Meanwhile, Taylorism’s simplification of skilled work and the elimination of unskilled work represents a central tenet of business process engineering techniques such as Six Sigma and lean manufacturing (Head, 2003). By the same token, modern quality assurance, operations management and total quality management methodologies arguably have their roots in scientific management. In this way, scientific management transcends the narrower confines of Taylorism by means of its direct and indirect influence on those subsequent evidence-based methodologies that also attempt to treat management and process improvement systematically as a measurable, scientific problem (Witzel and Warner, 2015).
Discussion of how Scientific Management Applies to Microsoft
Taylor’s original thinking was informed by the shop floor processes of heavy industry. As such, it would be easy to assume its principles would be largely irrelevant in an industry as complex, innovative and knowledge intensive as Information Technology. Indeed, Bill Gates’s professed values of entrepreneurship, ownership, creativity, honesty, frankness and open communication appear to stand in opposition to the standardised work processes and strict division of labour that Taylorism champions. However, on closer examination it becomes evident that scientific management still exerts a significant influence within Microsoft and on how it conducts its business.
As with all large multi-national corporations, specialisation and division of labour is very much in evidence at Microsoft. There is a clear division between functional specialists such as software developers, project managers, marketing, sales, HR, finance and legal. As Taylorism advocates, their roles have written job descriptions with clearly defined skills and competencies to ensure employees capabilities and motivations are carefully matched to their position. Furthermore, their performance is supervised and measured regularly using SMART criteria (Specific, Measureable, Achievable, Results-based, and Time-specific) in a way that echoes Taylor’s emphasis on monitoring and measuring.
There are a number of colourful stories that depict the results-orientated culture that Microsoft has relied on historically in its drive for success (see, for example, Shaw, 2004). Until recently, Microsoft employed a controversial management system called ‘stack ranking’ which measured performance using a standard distribution curve. Whilst those at the top received bonuses and promotions, those at the bottom were shown the door (for further details see B. R., 2012). Although this was intended to motivate performance, employees found it oppressive. Developers sought to avoid working with top performers, who threatened their own ranking, and as a result free thinking, innovation and collaboration stagnated. Microsoft abandoned stack ranking in 2013, but it is evident that performance reviews and systems such as these owe a debt to Taylor’s principle of performance incentivisation through pay and reward. Indeed, Bill Gates’s comment on workers and their value points towards a scientific management heritage: “A great lathe operator commands several times the wage of an average lathe operator”, Bill Gates points out, “but a great writer of software code is worth 10000 time the price of an average software writer” (Schumpeter, 2015, p. 1).
Microsoft’s business model relies on scientific management’s requirement to challenge received wisdom and to find new and better ways of doing things. This applies to Microsoft’s products and production processes in equal measure. Yet rather than pursue Taylor’s ‘one best way’ and control it by means of strict hierarchy and managerial supervision, Microsoft has, historically, sought to empower employees at all levels. Instead of allowing workers strict ‘need to know’ knowledge that relates only to their discrete part of a process, Microsoft runs an intensive induction programme for new recruits, which introduces them to the overall business model, and acquaints them with colleagues and support networks. This broader knowledge equips individuals with the context to make autonomous decisions that are nevertheless aligned with the organisation’s interests. This, in turn, lays the foundations for continuous improvement based on comparison, feedback and the identification of more effective and efficient work methods. Microsoft seeks to encourage improved performance not only by financial incentives, but also by considering more progressive drivers of employee motivation, participation and satisfaction. Thus, software programmers at Microsoft work long hours, but extra discretionary effort is encouraged by free food, relaxed dress code, comfortable offices, and playing games (for further details see Birkinshaw and Cramer, 2008). So, whereas Taylorism is criticised for its de-humanising tendencies, Microsoft arguably seeks to balance and blend the drive for enhanced productivity with a complementary appeal to the broader hierarchy of needs in its workforce.
This paper has offered a critique of Taylorism as the first and most influential theory that shaped a spectrum of subsequent management practices that fall under the wider umbrella philosophy of scientific management. The example of Microsoft shows how the principles of scientific management inform many practices that are still in use today. As a large, established, multinational organisation, Microsoft’s management practices are, almost inevitably, complex and contradictory and the brevity of this paper does not permit a more detailed investigation of how and to what extent scientific management principles inform the varied practices of different functions and divisions within the organisation. For example, the process of iterative product development owes a debt to scientific management as does project management and evaluation. Nevertheless, this paper has offered a broad overview of how Microsoft has appropriated, adapted and implemented elements of Taylor’s early scientific management theory, such as division of labour, employee selection, training and supervision, pay and reward, scientific evaluation, and process improvement, to improve Microsoft’s productivity, quality, and economic performance today’s fast-paced competitive environment.
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