What is Classical Theory? Discuss the Basis of Classical Theory

Classical organizational theories focus on formal concepts related to management and workplace efficiency. Taylor's scientific management approach falls under the classical theory. This approach focused on increasing productivity through mutual trust between management and employees. Weber's bureaucratic approach is a classical theory that explains the importance of hierarchy, rules, procedures and making impartial personnel decisions. Basis of Classical Theory: Scientific management: The scientific management approach is based on the concept of planning of work to achieve efficiency, standardization, specialization and simplification. The approach to increased productivity is through mutual trust between management and workers. Taylor (1947) proposed four principles of scientific management: • Science, not rule-of-thumb; • scientific selection of the worker; • management and labour cooperation rather than conflict; and • scientific training of workers. Weber's bureaucratic approach considers the organization as a part of broader society. The organization is based on the principles of: • Structure; • specialization; • predictability and stability; • rationality; and • democracy. Administrative theory was propounded by Henry Fayol and is based on several principles of management. In addition, management was considered as a set of planning, organizing, and training, commanding and coordinating functions. Neoclassical theory emphasizes individual or group behavior and human relations in determining productivity. The main features of the neoclassical approach are individual, work group and participatory management. These limitations have been summarized by March and Simon as follows: (i) The motivational assumptions underlying the theories are incomplete and consequently inaccurate. (ii) There is little appreciation of the role of intra organizational conflict of interest in defining limits of organizational behavior. (iii) The constraints placed on the human being by his limitations as a complex information-processing system are given little consideration. (iv) Little attention is given to the role of cognition in identification and classification as well as in decision. (v) The phenomenon of programmer elaboration receives little emphasis. Similar criticisms have been offered by others too.