Chapter-2

(A Historical Overview of Theoretical Perspectives & Change)

2.1 The Science Behind Scientific Management: (A Short Story)i

To understand the implications of the new science for management, start with the book that
coined the term “scientific management.” In 1911, the turn-of-the-century industrial engineer
Frederick Winslow Taylor published his magnum opus, The Principles of Scientific
Management, which laid out his ground rules for efficient industrial organization. Taylor‟s
book is now a classic of managerial literature. His ideas have shaped companies across the
industrial spectrum and defined the task of management for generations of managers.

Taylor‟s book was profoundly influenced by the concerns of the science—particularly the
physics—of his time. In the nineteenth century, Newton‟s laws of motion were first used to
analyze the forces exerted on and by complex physical systems, allowing scientists to predict
the behavior of those systems. Meanwhile, the principles of thermodynamics, elucidated in
the second half of the nineteenth century, provided the one missing ingredient—heat
interactions—needed to complete Newton‟s conception of the physical world. Together these
theories allowed scientists to calculate how machines could function with maximum
efficiency.

From the opening pages of his book, Taylor was preoccupied with the problem of efficiency
as it applies to organizations. When it comes to natural resources, he argued, people clearly
understand the need for efficiency because “we can see and feel the waste of material things.”
But “our larger wastes of human effort,” brought on by the “awkward, inefficient, or ill-
directed movements of men,” are “less visible, less tangible, and…but vaguely appreciated.”

According to Taylor, the fundamental cause of this waste of human effort was unscientific
management. In other words, he thought managers focused too much on the output of work
and not enough on the processes by which the work was done. In most turn-of-the-century
workplaces, managers paid workers for predetermined outputs, usually through some type of
“piecework” system, then left it to work crews to determine the actual methods of the work.
Taylor disparaged this approach, calling it the “initiative and incentive” system. “It is only by
giving a special inducement or „incentive‟…that the employer can hope even approximately
to get the „initiative‟ of his workmen.”

It‟s ironic to read Taylor‟s criticisms today, when so much emphasis has been placed on
encouraging employee initiative on the job and on crafting incentive systems that “pay for
performance.” Still, there were good reasons for why Taylor saw “initiative” and “incentive”
as part of the problem rather than part of the solution. As long as the managers of his day
depended on work groups to decide how work was done, they had no way to directly
influence the efficiency of the organization. Indeed, traditional management was an
inherently unstable system, which forced managers either to rely on coercion or to abdicate
their authority altogether. For example, one common way managers tried to boost
productivity was by regularly raising piece rates once most workers met them. But this only
induced workers to engage in “soldiering”—that is, to limit their output intentionally in order
not to undermine established rates.

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Taylor‟s solution was “the substitution of a science for the individual judgment of the
workman.” Managers were to separate the planning of work from its actual execution and
reserve for themselves the choice of methods by which a particular task was done. By
analyzing all of the steps in a work process and creating standardized procedures for each
step, managers could identify the “one best method” for performing a task that would
guarantee maximum efficiency. “The best management is a true science,” Taylor wrote,
“resting upon clearly defined laws, rules, and principles as a foundation.” And those laws
constituted an understandable, predictable, controllable system. “In the past the man has been
first; in the future the system must be first.”

In effect, Taylor urged the individual manager to think of himself as a scientist who alone
understands the fundamental laws of the system he is studying. For Taylor, the worker played
a passive role, almost as if he were part of the apparatus of the experiment. Over and over
again in his book, Taylor repeated this “general principle”: No matter what the job or how
seemingly simple the task, “the science which underlies each workman‟s act is so great and
amounts to so much that the workman who is best suited actually to do the work is incapable
(either through lack of education or through insufficient mental capacity) to understand the
science.” It is only the manager, armed with a scientific predisposition to “search for general
laws or rules,” who can understand the true science of work.

But this is not to say that Taylor ignored the issue of employee motivation or the
psychological dimension of work. On the contrary, a major part of The Principles of
Scientific Management concerns “the accurate study of the motives which influence men.”
That is, for scientific management to be successful on Taylor‟s terms, managers must do
more than just analyze and reorganize work. They need to effect “a complete revolution in
the mental attitude” of the worker.

Yet even here Taylor reflected the scientific assumptions of his day—particularly the belief
that “the motives which influence men” can be reduced through scientific analysis and
control in the same way that the physical activities of shoveling iron or cutting metal can be.
In discussing employee motivation, Taylor noted, “At first, it may appear that this is a matter
for individual observation and judgment and is not a proper subject for exact scientific
experiments.” But while psychological laws are more complicated and subject to exceptions,
“owing to the fact that a very complex organism—the human being—is being experimented
with,” Taylor maintained that “laws of this kind, which apply to a large majority of men,
unquestionably exist and when clearly defined are of great value as a guide in dealing with
men.”

After such lofty language, some of Taylor‟s actual suggestions are self-evident. For example,
he insisted that productivity improvements based on scientific management be shared with
workers in higher wages; otherwise they won‟t cooperate in work reorganization. Other
suggestions of his are crude and simplistic, like this major piece of advice: Never deal with
workers as a group, only deal with one individual at a time. “When men work in gangs, their
individual efficiency falls almost invariably down to or below the level of the worst man in
the gang.” Taylor‟s solution was to have workers assigned individual tasks that they were to
perform in the greatest possible isolation.

But whatever one thinks of his specific suggestions, they all share the nineteenth-century
scientific regard for reductionism: breaking down things into isolated parts in order to better
control them. Indeed, all of the techniques of scientific management—the planning
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department, time-and-motion study, standardization of methods and tools, and the like—are
so many means to this end. But Taylor urged his readers not to confuse the techniques with
the basic scientific principles. “It is only through enforced standardization of methods,
enforced adoption of the best implements and working conditions, and enforced cooperation
that this faster work can be assured. And the duty of enforcing the adoption of standards and
enforcing this cooperation rests with the management alone.”

Frederick Taylor‟s principles inaugurated a revolution in management and in the organization

of work. In the decades after his book‟s publication, Taylor‟s ideas contributed to massive
increases in productivity and the standard of living. However, the experience of the last 20
years has taught managers that in a new business environment such “scientific” principles are
a recipe for disaster. In fast-changing markets, the fragmentation of work, the separation of
planning from execution, and the isolation of workers from each other create rigid
organizations that can‟t adapt quickly to change. As a result, managers must now rethink the
fundamental elements of Taylor‟s system: work organization, employee motivation, and the
task of management.

The majority of new managerial ideas—like cross-functional teams, self-managed work

groups, and the networked organization—are either direct or indirect responses to the
inadequacies of Taylor‟s original model. Yet for all of the proliferation of specific
techniques, the fundamental principles of a new managerial paradigm are far from clear.

At this current crossroads, recent developments in science may prove helpful. Even as Taylor
was codifying his own organizational system, scientists were beginning to understand the
shortcomings of the nineteenth-century scientific models on which that system was based.
Within a decade of the publication of Taylor‟s book, new developments in physics—
Einstein‟s relativity theory and quantum mechanics—suggested that at the extremes of space
and time, from the universe in its entirety to subatomic particles, the laws of Newtonian
physics broke down. And more recently, scientists have extended that message of uncertainty
and unpredictability to the everyday world.

2.2 Change and the industrial revolution:ii

The World Economic Forum‟s annual gathering of economic leaders, tycoons, and celebrities
finished up last Saturday in Davos, Switzerland, and the meeting was not short on big ideas
about how the world of talent is going to shape up in the near future.

The centerpiece of the discussion was what people are calling the Fourth Industrial
Revolution (although there‟s some debate about whether we are still in the third). The WEF
put out a long report with a lot of statistics to help you understand the shift and to scare the
world into action—especially with the much-reported statistic that robots are going to steal
about 5.1 million jobs by 2020. (You can read the executive summary here—though
apparently you must still download PDFs in the Fourth Industrial Revolution.)

The revolution, it is argued, ushers in a blurring of the physical and the digital and,
importantly, does so at incredible speed and disruption to business. For Fortune editor Alan
Murray, the human element of this change was one of the key takeaways from Davos:

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Digital transformation is as much about people as technology. I moderated two private CEO-
level discussions focused on the digital transformation of industries, and in both, the human
challenges trumped technological ones. Companies struggle to create cultures that can
embrace rapid technological change, and governments struggle in response to publics more
likely to focus on future risks than future benefits.

CEB data certainly bears this out. For the last year, we‟ve been tracking the impact of change
at organizations as companies have looked to transform both their HR functions and their
workforces to better handle the onslaught of change largely generated by the digital
revolution. And as the WEF meeting made clear, change in this new era is very different than
in the past.

One key difference is the constant pace of change. In our own research, we find that the
average organization has made a whopping five enterprise changes—such as cultural change,
restructuring, market expansion, leadership transition, or merger/acquisition—in the last three
years. Change is doubtlessly accelerating. (CEB members can read our latest research on
enterprise change here.)

Another key difference is the importance of new skills and knowledge to change. We are in
the middle of collecting data for a new study on the workforce and change, but one striking
thing we have found so far is how often employees say that new skills and knowledge are
required in this evolving environment.

The executive summary of the WEF report describes a world in which employees‟ skills are
in need of constant change:

“Given the rapid pace of change, business model disruptions are resulting in a near-
simultaneous impact on skill sets for both current and emerging jobs across industries. If
skills demand is evolving rapidly at an aggregate industry level, the degree of changing skills
requirements within individual job families and occupations is even more pronounced. Even
jobs that will shrink in number are simultaneously undergoing change in the skill sets
required to do them. Across nearly all industries, the impact of technological and other
changes is shortening the shelf-life of employees’ existing skill sets.” (Emphasis mine)

The WEF helpfully thinks about this in terms of skill stability: that is, whether skills in your
role and industry are changing or staying relatively the same. By 2020, they predict, about a
third of the core skills in most occupations today will no longer be crucial. Think about the
impact of that: Right now, you might be training, selecting, and promoting people based on
skills that won‟t be that important in the future! That‟s a waste of time and energy.

So if you are an executive, what do you need to do talent-wise to get ahead of this new world
of instability? First, this massive disruption is going to require a new approach to change
management. This means an HR department that is flexible, agile and aligned with the
business, rather than focused on its own specialties. Second, change has to be led more from
the ground-up by employees. Leaders simply don‟t have full insight into everything that
needs to happen fast enough to make change successful any more. Third, talent practices have
to be updated to reflect a constantly changing environment. Your engagement and
performance management systems need to move in real time. Your succession management
system needs to groom a portfolio of leaders rather than pushing people through a static
pipeline.
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I‟m not sure whether the Fourth Industrial Revolution language is going to stick, and I
guarantee a lot of the celebrity quotes that came out of Davos will be forgotten by next week.
But accelerating change—by whatever name—is real.

2.3 Boston Scientific announces management changes, restructuring

initiatives:iii
Boston Scientific Corporation on February 11 announced a series of management changes
and restructuring initiatives designed to strengthen the company and position it for long-term
success.

"The actions we are announcing today will provide the organizational structure and
leadership needed to execute our strategic plan and fulfill the enormous promise of this
company," said Ray Elliott, president and chief executive officer of Boston Scientific.

"They are aimed at driving innovation, accelerating profitable growth and increasing both
accountability and shareholder value. Above all else, they will help us better serve our
customers and their patients."

In addition, the company announced the following management changes:

 Sam Leno will be promoted to executive VP and chief operations officer, effective
March 1. He will oversee Finance, Information Systems, Manufacturing and
Operations. Since joining Boston Scientific in 2007, Leno has served as executive VP
of Finance and Information Systems and chief financial officer.
 Jeff Capello will be promoted to executive VP and CFO, effective March 1. Capello
joined the company in 2008 and has served as chief accounting officer and corporate
controller.
 Tim Pratt has been promoted to EVP and chief administrative officer; he will continue
to serve as general counsel and secretary. The company will consolidate Legal,
Corporate Communications, Government Affairs, Human Resources, Quality and
Regulatory Affairs under Pratt, who joined the company in 2008.
 Jean Lance has been promoted to senior VP and chief compliance officer and will
become a member of the company's Executive Committee. Lance joined Boston
Scientific in 1996 and was named chief compliance officer last year. Prior to that, she
served as VP and general counsel for the company's Cardiovascular Group. She
manages and enforces Boston Scientific's Global Compliance Program.
 Dan Brennan has been promoted to senior VP and corporate controller. Brennan
joined Boston Scientific in 1996. He has served in a wide variety of finance roles
supporting a number of the company's businesses.
 Larry Neumann has been promoted to senior VP of Restructuring and Integration.
Neumann will oversee and be accountable for all the company's restructuring and
integration activities, including the combination of the Cardiovascular Group and the
Cardiac Rhythm Management Group. Neumann joined the company in 1996 and has
served in a number of capacities, including head of Corporate Tax, Business
Development and Investor Relations.

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  Andy Milani has recently been named senior VP of Human Resources. Milani joined
Boston Scientific in 2009 after a distinguished 28-year career as an officer in the U.S.
Army, serving most recently as Chief of Staff for the Army's Special Operations
Command.

"These changes to date bring together an outstanding group of seasoned leaders, with a broad
range of talents and abilities and a proven history of delivering results and achieving
objectives," said Elliott. "The company and all its stakeholders stand to benefit considerably
from their collective knowledge, experience and expertise. These changes were, in part,
designed to allow me to spend more time with our operating divisions and international
regions, as we place greater emphasis on stimulating sales growth, assessing our business
portfolio opportunities and expanding operating profit margins."

Boston Scientific is a worldwide developer, manufacturer and marketer of medical devices

whose products are used in a broad range of interventional medical specialties.

2.4 Human Dimension of Change:iv

Change management is not a new thing. The idea that change is constant goes back to the ancient
Greeks. „No man ever steps in the same river twice,‟ said change consultant Heraclitus 2,500 years
ago.

Today the world is changing faster than ever and businesses must evolve fast or die. In part this is
driven by the pace of technology adoption. For example, it took decades for the telephone to reach the
majority of households, but mobile phones got there in five years.

This is the central dilemma of our time: change is essential but difficult. It‟s easier to sign the
purchase order for some new IT project than it is to get people to use it. In this light, change
management is a core competence for successful businesses.

This is not to say that one attitude is morally superior to the other. But in smaller, entrepreneurial
companies‟ business leaders tend to push for change and employees tend to resist it and, arguably, in
larger, more established companies it is the other way around. And in some cases, an inflexible
middle-management layer can be the obstacle to change.

The rational brain is only one partner in the decision-making process. Emotions also play a
strong part. Understanding these emotional responses is an important part of change
management.

 Nostalgia. An old system can be a symbol of a previous, happier way of working. For
example, when two companies merge and one company‟s systems replace the others, this
change can be emblematic of a wider loss of identity.
 Sunk cost fallacy. It‟s easy to feel that time spent making a bad system work is a good
investment and shouldn‟t be thrown away but, in fact, that cost has already been paid. The
only useful yardstick is based on the future cost and benefit of change vs doing nothing.
 Fear of loss. Change is scary because it brings uncertainty. Old skills become less valuable
and perhaps people feel their jobs or prospects are at risk. Loss aversion is a very powerful
feeling.

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  Need for status. People who have invested in mastering an old system are threatened by the
introduction of a new one. They feel that their knowledge and experience is being
disrespected.
 Laziness. Some people don‟t like learning new things or they feel that they will have to spend
their own time to do so and they don‟t want to make that investment.
 They think it won’t work. If they don‟t trust the company, if previous change projects have
failed, if they don‟t see the bigger picture or they have the power to sabotage it, failure looks
like a real possibility so why bother making the change in the first place?

2.5 3
Popular Models of Organization Development (Explained With
Diagram):v
Among the models of OD developed by the behavioural scientists, the following three models
are very popularly discussed in organizational behavior. They are:

1. Kurt Lewin‟s Unfreezing, Changing and Refreezing Model

2. Greiner‟s Equential Models, and
3. Leavitt‟s System Model

These are discussed in seriatim.

1. Lewin’s Model:

Lewin‟s model is based on premises that before actually introducing a change

organization needs to be prepared for change, motivated to change and established and
integrated the change into behaviors of organization Accordingly, Lewin has
nomenclature these steps as unfreezing, changing and refreezing. A brief description of
these follows.

 Unfreezing: No change occurs in a vacuum of no prior perspective. To the

extent the new perspective differs from the old one, the old one then implies
doubting of its own existence. This necessitates unlearning of old things in
order to learn new things. The same is called unfreezing. Unfreezing involves
encouraging individuals to discard old behaviors by shaking up the
equilibrium that maintains status quo. Thus, unfreezing implies creating the
need for change, motivating people for change and minimizing resistance to
change. Practical Steps for Using the Framework-
 Determine what needs to change.
 Ensure there is strong support from senior management.
 Ensure there is strong support from senior management.
 Manage and understand the doubts and concerns.

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  Changing: Having unlearned his past experience, the individual is ready for
new behavior and a change in perspective. Efforts are made to substitute new
attitudes, values and behaviors for old ones. This implies transition from old
behavior to experimentation with new behavior. Practical Steps for Using the
Framework-
 Communicate often.
 Dispel rumors
 Empower action
 Involve people in the process.

Refreezing: In this final step, new attitudes, values, and behaviors are established as
the new status quo. For this, the new ways of operating are cemented in and
reinforced. This implies stabilizing and integrating the change by reinforcing the new
behaviors and integrating them into formal and interpersonal relationships and in
one‟s personality. Practical Steps for Using the Framework-
 Anchor the changes into the culture.
 Develop ways to sustain the change.
 Provide support and training.
 Celebrate success!

2. Larry Griener’s Model:

According to Griener, change occurs in terms of certain sequential stages. The external
stimulus pressurizes the management of organization to initiate change process. The manage-
ment in response to stimulus is motivated to take actions to introduce change in organization.
Following the actions, the various change stages occur in a sequential manner such as
diagnosis of the problem, invention of a new solution, experimentation with new solution and
reinforcement from positive results.

Greiner‟s these OD sequential stages are shown in figure 12.1.

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3. Leavitt’s Model:

Leavitt‟s OD Model is founded on the interactive nature of the various subsystems in a

change process. In an organizational system, there are four interacting sub-systems- tasks,
structure, people and technology. Due to their interacting nature, change in any one of the
sub-systems tends to have consequences for the other sub-systems also.

Change in any one of the sub-systems can be worked out depending upon the situation. How
the various sub-systems, according to Leavitt, interact with each other in a change processes
depicted in the following figure 12.2.

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Reference:

i
https://hbr.org/1992/11/is-management-still-a-science
ii
https://www.cebglobal.com/talentdaily/change-management-in-the-fourth-industrial-revolution
iii
http://www.reliableplant.com/Read/22796/Boston-Scientific-management-chang
iv
https://businessvalueexchange.com/blog/2014/04/08/human-dimension-change-management
v
http://www.yourarticlelibrary.com/organization/3-popular-models-of-organisation-development-explained-
with-diagram/35323

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