Classical Management Foundations for the Future of Management Education Ellen S. O’Connor, Ph.D., M.B.A. ([email protected])[email protected].

Classical Management Foundations for the Future of Management

Education

Ellen S. O’Connor, Ph.D., M.B.A.([email protected])

Philosophie & Management (www.philoma.org) Brussels, June 23, 2014

What mustbe done?

1. Recover forgotten

knowledge

2. UnderstandWhy it was forgotten

3. Build on this knowledge

Mary P. Follett1868 - 1933

Chester Barnard1886 - 1961

Industrialization & the new organizational form

• Unlike familiar forms (church, state & military)

• Relating to (discovery) & applying basic science (exploitation)

• Converting to scale reliably & continuously (formal organizing)

• Spreading quickly

More

artificial

New organizational

form

More

fictitious

More

ephemeral

More

complex

Potentially Very large

scalePotentially generating

massive wealth

Education gap for the new industry

• “Business” schools: Clerks

• Colleges: Gentlemen

• Scientific schools: engineersWealthy industrialists

look for new institutions

Accelerating factors

Panic of 1873

Credit mobilier fraud 1870’s

Great railroad strike 1877

Injunctions against unions 1877

Pennsylvania state militia fires

1877

1879

Modern industry requires us to organize

under single leaders… great amounts of capital & numbers of laborers

The fruits of organized labor must be

properly divided among

capitalist, leader & workman

The importance of educating men to combine their energies for the accomplishment of any desirable object,

and the principles upon which such combinations should be effected

First Collegiate school of business curriculum

Joseph Wharton1826 - 1909

Instillnew values

Wharton’sagendas

Makenew discoveries

Teachnew subjects

Decentralization

New organizational

form(deeper)

Suboptimization

Regimentation

Uncertainty

New organizational form’s consequences

New individual, collectivity & interdependencies

New knowledge

But no institutional support for generating & growing that knowledge

Missed opportunities: the 4 crises

1881Wharton

Collegiate School of business

1919Harvard BusinessSchool

1890New York University

College

1948Carnegie

Graduate School of Industrial Admin.

Comprenhensive

knowledge transfer(Barnard & Harvard in 1930’s-40’s); Simon’s seminars on Barnard in late 40’s)

Basic science of

collective value(s) creationFollett (1924)

General

theory of organizationBarnard (1938)

TheClassics’

contribution

Exerting

centripetal force

Securing

creative contribution of allBuilding an

interdependence culture

TheClassics’

Key managerial roles

• Microeconomics• Corporate strategy• Shareholder value

theory• Neoclassical economics

No pursuit of problems & solutions identified by classical management

Agenda: Short-Term Wealth Maximization

Next steps?

1. Recover forgotten knowledge• Educate

educators

2. Understand why it was forgotten• Developing

historical sensibility

3. Build on classical management theories & findings

• Research• Rigorous testing• Living case method

Classical Management for today A workshop

Ellen S. O’Connor, Ph.D., M.B.A.([email protected])

Philosophie & Management (www.philoma.org) Brussels, June 24, 2014

Purpose of management education

Develop members & leaders of formal organization

who master the tool of organization, in pursuit of

individual & collective

value(s) creation at the highest level, continuously, and

in the long run

• Develop members and leaders of formal organization who master the tool of organization, in pursuit of individual and collective value(s) creation at the highest level, continuously, and in the long run.

• This calls for a higher-order institution with the knowledge to provide that education.

Need for a higher-order institution with the knowledge to provide that education

Need for a consensus on• Vision• Terminology• Tested & proven findings

What We Know So Far

Names & titles

Livinginsights

Historicalfigures

Educationalexperiments

Keyfindings

“Failed” educational experiments: the 4 crises

1881Wharton

Collegiate School of business

1919Harvard BusinessSchool

1890New York University

College

1948Carnegie

Graduate School of Industrial Admin.

Wharton(1826-1909)

Fayol(1841-1925)

Taylor(1856-1915)

Follett(1868-1933)

Rowntree(1871-1954)

Donham(1877-1954)

Barnard(1886-1961)

Key Findings

Core knowledge

grown piecemeal in a small group

of scientifically & developmentally

minded executives

Key findings

Business schools: so far organized to serve academic & technical specialists

Science based on

individual experience “in the physiological condition of personal responsibility”

in formal organization

Comprenhensive

knowledge transfer(Barnard & Harvard in 1930’s-40’s); Simon’s seminars on Barnard in late 40’s)

Basic science of

collective value(s) creationFollett (1924)

General

theory of organizationBarnard (1938)

LivingInsights(key classics’

contributions)

Management

Value(s) creation

pivot multiplier, in pursuit of

creative tension between conflicting forces(sensed within)

Centrifugalv.

Centripetal

Discoveryv.

Exploitation

Individualv.

Group

Individualv.

Regimentation

Freedomv.

Subordination

Contributingv.

Witholding

The Conflicting and Creative Forces

• Organization: Centrifugal v. centripedal• Organization: Discovery v. exploitation• Organization: The individual v. the group• Individual: Individualism v. regimentation• Individual: Freedom v. subordination• Individual: Contributing v. withholding

Management

Value(s) creation

pivot multiplier, in pursuit of

creative tension between conflicting forces(sensed within)

Centrifugalv.

Centripetal

Discoveryv.

Exploitation

Individualv.

Group

Individualv.

Regimentation

Freedomv.

Subordination

Contributingv.

Witholding

Executives exert

centripetalforce

(re)invent

purposes(re)invent

moral codes

integrate

internallyintegrate

externally

incarnate through

own person(Subordination, predictability

& sincerity)