Scientific Management Theory in the Workplace
When it comes to finding ways of improving economic efficiency, different work environments often require different approaches to this issue.
Some of these solutions come from modern or technology-led principles, some stem from older scientific theories, and others use a combination of both.
One of the oldest approaches still used is the scientific management theory, which is about analyzing productivity.
Let's look at how to implement this theory in the workplace and how it can improve efficiency.
Scientific management theory was developed by an American mechanical engineer named Frederick Taylor in the early 1900s. Taylor was interested in the work processes used in various mechanical shops and factories. After observing how they worked, he developed his new theory.
He noticed that the workers were often unfamiliar with proper work procedures and even the managers and the owners had little idea about how the work needed to be done.
From this, Taylor developed the hypothesis that if a worker receives enough incentive for learning how to do things properly and consistently, they will be prompted to continue doing so.
Another part of Taylor's new forming theory was the idea that companies can thrive only if they are able to meet a specific target and that workers and management all have a responsibility to work on these targets together.
This represented a vast improvement to the systems in place at the time, in which no one seemed to work towards any individual goals and managers only had a duty to supervise employees, but not much besides that.
Taylor suggested changing this approach, so the managers could take on the function of planning production and the training of workers.
Taylor proposed that workers should be compensated according to their skills and productivity and developed a system to measure this.
He also believed that if an employee cannot meet their goals in their current workplace, they should find another position that's more suitable for their skills.
What makes scientific management a specific theory and not just a random function of scientific principles is that a significant part of it was based on time studies.
To reduce production time, Taylor worked with managers on time studies.
This entailed breaking down each process into its components and measuring how long it took to complete each one.
Based on this, Taylor was able to make processes more efficient. Naturally, this took a lot of timing and calculating, but ultimately, he was able to transform the work of management.
From then on, managers had a set of carefully calculated techniques to rely on when planning work procedures.
Moving on to make further improvements, Taylor declared that the organization of each factory or workshop should be conducted by professionals who are able to plan, coordinate and control the entire process.
To put it simply, this meant the managers should be able to run the organization as if it were one big machine. This is where the idea of applying scientific principles in factory management originally came from.
To achieve productivity levels of such precision with the human workforce, Taylor knew that the processes would have to be simplified and optimized to fit the workers' abilities.
For workers who didn't yet have a specific skill set, Taylor proposed intensive training to learn new skills. They could then be matched with a particular job and carry it out in the most effective way possible.
Pioneered in the early 1900s, scientific management theory continued to make meaningful contributions to work management throughout the rest of the century.
Aside from the initial production efficacy, with advances in statistical methods provided by new technology, the scientific management approach was also used for constant quality control and reassurance, processes that began in the 1920s and 1930s.
By the time the second industrial revolution ended in the early 20th century, Taylor's scientific management theory had been successfully applied for several decades. Due to the revolution, many new leadership methods had begun to emerge. Within the next decade, scientific management theory seemed to have been rendered obsolete.
Yet, during the late 1940s and 1950s, scientific management theory evolved. It was split to fit into different management sectors, including management cybernetics and operations management and research.
Further development of the theory was seen in the 1980s with the rise in popularity of total quality management, and again in the 1990s when the same thing happened with re-engineering processes.
For scientific management to remain applicable through the years, many adaptations were made. These were mainly necessary to account for the rapid advancement of technology. The digital solutions provided by modern technology can further contribute to the enhancement of Taylor's theory, which is the main reason it's still used today.
Today, scientific management is used in organization charts, quality measurements and similar metrics, performance evaluations, sales and production goals, or any other KPIs (key performance indicators).
Scientific management theory has four core principles that, albeit in a modified form, remain applicable in today's organizations. They represent a summary of Taylor's suggestions:
- Standardization – Applying scientific principles of analysis in work processes or specific tasks to determine the best way to perform them
- Specialization – Hiring employees for positions that match their skills and train them even further, allowing them to work as efficiently as possible
- Performance-related pay – Monitoring work performance and providing feedback, instructions or training if needed
- Hierarchical supervision – Dividing responsibilities between workers and management. This allows the managers to focus on planning and training, and the workers to execute their job more efficiently.
Each core principle of scientific management theory is expanded below.
Without a predetermined performance standard, the managers or the owner of the company cannot determine how much work should be done by each employee.
Setting performance standards for time, costs and work quality are paramount for raising productivity.
Workers with the same rank in the company share a standard of work performance. Therefore, production efficiency is improved because they are all working toward the same goals, and the company can thrive.
For this to be successful, workers need appropriate training, working conditions and tools.
According to the scientific management approach, the efficiency of each individual worker can contribute to the success of the entire company.
Therefore, training the employees and honing their skills should be the management's top priority.
Each person should be given responsibilities based on their abilities and interests, with the possibility of increasing these responsibilities if their skills improve.
Knowing that the company pays attention to the employees' self-improvement efforts creates a more positive work environment, in which the workers will participate more enthusiastically.
Workers will only stay efficient if they are rewarded for their work.
A rating system with fixed wages following productivity levels can promote this.
This means that workers who don't meet a predetermined standard will earn low wages, while those who meet the desired output or even exceed it will earn higher wages.
The purpose of this is to entice the less efficient personnel to improve their efficiency.
Increased production capacity may also result in higher salaries for all workers. This can motivate the hardworking employees even further.
Overall, the goal is to give the right incentive to each worker to boost their productivity levels.
While the theory calls for a more even allocation of responsibility between team leaders and individual members, it also highlights the need for hierarchical supervision.
In this system, the authority is assigned by rank, and each of these takes directions from a higher power.
As the chain of command goes upwards, the responsibility grows.
Meanwhile, each employee knows to whom they answer, which helps avoid confusion between different teams.
Scientific management theory can be implemented in many ways. Let's look at some of the more common applications.
These methods are based on the theory's core principles and are designed to benefit the whole workplace, including the company and the workers themselves.
Workers demand and deserve recognition. Due to the ever-increasing market demand, the only way to sustain a company is to provide the rewards the employees deserve.
Based on the principle of performance-related pay, recognition in the form of bonuses and salary increases can be a huge motivation for the workers.
Through using performance-based pay, you will see the efforts each employee puts into increasing production because they know it will directly benefit them.
It's a good idea for managers to establish proper productivity goals and allocate bonuses for each employee who reaches these.
Further raises can be implemented for consistently meeting or exceeding the predetermined goals.
The managers should perform regular employee evaluations and provide appropriate feedback so the workers have a chance of improving their performance levels.
Key performance indicators (KPIs) are metrics used to track and analyze factors that determine a company’s overall performance in the market.
These include revenue, profit and expenses. Other KPIs may include inventory turnover, gross and net profit margin, costs of sold products or services and outstanding days of production and sales.
By monitoring these, you can apply the standardization principle and determine better standards for workers to meet.
For example, if the KPIs show that revenue can be increased by selling more of a particular product or service, the logical step should be increasing production of that product or service.
Assigning one or more employees to complete a complex project can be problematic due to restrictions in their skills.
You can save a lot of money if you break down the project into several tasks and assign each of these to appropriately skilled employees.
Based on the specialization principle, part of a manager’s role is to recognize their employees’ skills.
If employees work on problems best suited to their talents, their productivity will increase, and they will complete their tasks more efficiently.
If an employee finishes their part sooner than expected, the next step can be begun sooner than expected too. Consequently, the project will be completed ahead of time.
Experimenting with different completion methods for each task allows you to find the best way for workers to perform their job.
This will allow you to find the process that takes the fewest steps and the least amount of time to finish. Once you find the best way to do one task, you can apply this to similar tasks.
To achieve overall efficiency in your department, you may need to combine several principles of scientific management, for example, standardization and specialization.
It will also require implementing a specific management system to supervise the projects and retrain the workers if needed.
According to the principle of hierarchical supervision, you must ensure that all workers understand their responsibilities and duties.
Beyond being familiar with the scope of the work that's expected from them, they should also know the chain of command.
Usually, workers on the lower levels of the hierarchy should answer to their supervisor. The supervisors report to the team managers, who, in turn, receive orders from the directors.
Workers follow directions from the supervisor in completing the tasks, while the managers are responsible for establishing the entire work process. This includes:
- Planning work
- Training supervisors and employees
- Overseeing projects
Despite having a traditional, stern approach, scientific management theory still represents one of the most relevant methods to determine a company’s structural system.
It's based on a formalized process for creating timekeeping records and a standard motion that's applicable within different industries.
Therefore, the approach is suitable for any modern organization that wants to increase its profit margins.
If the goal is to improve efficiency of individual workers in an organization, then yes, the theory definitely works.
It prompts workers to develop their skills and work intensively alongside technological improvements, enhancing their ability to perform routine tasks.
This leads to higher production levels in each sector, more sales and, ultimately, improving the company's bottom line.
The main theory is focused on individuals, helping them develop more skills and reach their potential.
Nevertheless, the theory promotes collaboration between teams and their leaders, and among the workers themselves.
Managers following the scientific management theory encourage workers to form a more extensive skill set, contributing overall to more efficient teamwork.
Owners and investors can benefit from this theory because it raises accuracy levels and lowers production costs.
Lower production costs also mean lower selling prices for the final product, which attracts customers.
Further, this theory allows business owners to control their teams and make quick decisions as to whether any adjustment is necessary.
Finally, more efficient production can mean less waste, which is better for the environment.
One of the biggest disadvantages of this theory is that all that planning, training and standardization required can be costly.
Workers are constantly being supervised and are often pushed to finish larger amounts of work within a shorter time frame without a salary increase.
This can have a demotivating effect on the employees, leading to high turnover.
Some of its solutions may also eliminate the need for human power, which results in high unemployment levels.
Despite being over a century old, the scientific management approach devised by Frederick Taylor still has a lot to offer companies seeking to raise their productivity levels.
Through its principles of standardization, specialization, performance-related pay and hierarchical supervision, this approach can highlight the problem areas within the company so targeted solutions can be implemented.
Combined with modern tools such as digital advertising and payment-handling solutions, it can contribute significant improvement in all levels of an organization.
This leads to better production goals, higher sales conversion and gives the company the ability to stay ahead of the competition.