The Classical Theory of Organisation and It's Relevance

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International Research Journal of Finance and Economics ISSN 1450-2887 Issue 41 (2010) © EuroJournals Publishing, Inc. 2010

The Classical Theory of Organisation and it's Relevance
Mahmoud M. Alajloni Irbid Private University, Dept of Business Admin Ziad. M. S. Almashaqba Irbid Private University, Dept of Business Admin Marzouq Ayed Nemer Al-Qeed Applied Science Private University, Department of Hotel Management Abstract Organization facing competition need to take care of different dimensions of management to perform effectively such as style of leadership, motivational factors, and the importance of informal relations. The classical theory of organization suffers superficiality, over simplification and lack of realism in terms of problems faced by competitive organizations. Taylor and theorists of scientific management over rated scientific methodology as a value free integrating force that could bring about total managerial revolution. However the present forces of organizational change facing open ended competitive challenges are not prepared to accepts the principles of scientific management. Organizations facing competitive situations must have good managementlabor relations to improve productivity, must work towards fulfillment of social needs, along with financials needs which were all but ignored in the framework of scientific management. Hence it must be understood. Keywords: Classical theory, organizational theory, scientific management

The classical theory of organization has with held the test of many upheavals in the changes that have accrued in the management of organization. The modern organizations in the private as well as in the public sector enterprises are facing an environment which does not seem to be conducive to their structure that is based on the principles of classical theory of organization. The classical school of organization developed and pursued in the development of universal principles that would apply to all the organizations in all situations. The classical theorists conceived of organizations as mechanical devices to achieve organization's goals and objectives. The era of classical theory of organization covers the period from 1900's to mid-1930. During this period the classical theories of organization began to emerge. Important pioneers among them are F.W. Taylor, Henri Fayol, Max Weber, and Mary Parker Follett. The classical theory is based on the following three assumptions: 1. The relationship between employees and management is defined by means of formal structured communication process, defined tasks, defined accountability, and formalized procedures and practices to avoid any conflict in their relationship. 2. Workers have been treated as economic man who can be motivated by means of money only.

International Research Journal of Finance and Economics - Issue 41 (2010)


3. The third assumption is that the workers have been considered as a product of means of production or as a cog in the wheel. Weiss considered that hierarchical bureaucratic model of organization was not interpreted correctly in it is translated form as it was not meant to be an ideal type of structure. Instead the hierarchical bureaucracy was an example of the structural form taken by the political strategy of rational-legal domination. The classical theories of organization were structured by the scholars with certain objectives in mind which can be enumerated in the following manner: a.) Henry Fayol, a French engineer-cum-manager in Europe is generally considered as the founder and Father of the classical school of organization who initiated the administrative theory of management. He analyzed the process of management in terms of technical ability that is more dominating on the lower level and middle level of management whereas managerial ability is more important for higher level of management. Henry Fayol considered that sound...
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