Chester Barnard and the Systems Approach to Nurturing

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Chester Barnard and the Systems Approach to Nurturing
Organizations
Andrea Gabor

Joseph T. Mahoney

Baruch College, City University of New York

University of Illinois at Urbana−Champaign, College
of Business

Abstract
Chester Barnard was best known as the author of The Functions of the Executive, perhaps the 20thcentury’s most influential book on management and leadership. Barnard offers a systems approach to the study of organization, which contains a psychological theory of motivation and behavior, a sociological theory of cooperation and complex inter−dependencies, and an ideology based on a meritocracy. Barnard’s teachings drew on personal insights as a senior executive of ATTin the 1920s and 1930s, and he emphasized the role of the manager as both a professional and as a steward of the corporation. For leadership to be effective, it had to be perceived as legitimate, Barnard maintained. Barnard sensed that the central challenge of management was balancing both the technological and human dimensions of organization. The challenge for the executive was to communicate organizational goals and to win the cooperation of both the formal and the informal organization; but he cautioned against relying exclusively on incentive schemes to win that cooperation. Responsibility—in terms of the honor and faithfulness with which managers carry out their responsibilities−−is the most important function of the executive.

Published: 2010
URL: http://www.business.illinois.edu/Working_Papers/papers/10−0102.pdf

Chester Barnard and the Systems Approach to Nurturing Organizations

Andrea Gabor
Associate Professor, and Michael R. Bloomberg Professor of Business Journalism, Department of Journalism
Baruch College
City University of New York
One Bernard Baruch Way
55 Lexington at 24th St.
New York, NY 10010
(646) 312-3970
AAGabor@aol.com, andrea.gabor@baruch.cuny.edu
1999-

Joseph T. Mahoney
Investors in Business Education Professor of Strategy, &
Director of Graduate Studies,
Department of Business Administration
College of Business
University of Illinois at Urbana-Champaign
350 Wohlers Hall
1206 South Sixth Street
Champaign, IL 61820
(217) 244-8257
josephm@illinois.edu

Chester Barnard (1886-1961) was best known as the author of The Functions of the Executive, perhaps the 20th century’s most influential book on management and leadership. 1 The book emphasizes competence, moral integrity, rational stewardship, professionalism, and a systems approach, and was written for posterity. For generations, The Functions of the Executive proved to be an inspiration to the leading thinkers in a host of disciplines. Perrow writes that: "This ... remarkable book contains within it the seeds of three distinct trends of organizational theory that were to dominate the field for the next three decades. One was the institutional theory as represented by Philip Selznick [1957]; another was the decision-making school as represented by Herbert Simon [1947]; the third was the human relations school [Mayo, 1933; Roethlisberger & Dickson, 1939]" (1986: 63). 2

Barnard’s work also influenced sociology’s Parsons and Gouldner and

informed the institutional economics of Williamson (1975, 2005). Indeed, Andrews states that: “The Functions of the Executive remains today, as it has been since its publication, the most thought-provoking book on organization and management ever written by a practicing executive” (1968: xxi). Barnard combined the capacity for abstract thought 1

As of July 25th 2010, Barnard’s (1938) Functions of the Executive had been cited over 8,000 times (Google Scholar). See Bedeian and Wren (2001) for their ranking of the top 25 most influential management books of the 20th century with Taylor (1911) and Barnard (1938) occupying the top two positions.

2

Classic works influenced by Barnard’s The Function of the Executive include: Boulding (1956), Coser (1956), Cyert & March (1963), Dalton (1959),...
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