The history of organizations perhaps can be traced back to the early days of humanity. Every time a group of people faces an enormous task that is too big to be handled by one person, an organization may be born along with the management process. However, the urgency to develop management science did not appear until the Industrial Revolution, which gave birth to various kinds of organizations like never before. The importance of an effective way to manage big organizations led managers to discuss and write their ideas and management problems they are facing (Ivancevich et al., 2013). This is how organizational theory was born.

Of all the ideas in the early development of management, four ideas were considered central to the understanding of organizational theory. The four theoretical contributions are Scientific Management by F.W. Taylor, Administrative Theory by Henri Fayol, Bureaucracy and Organizational Structure by Weber, and Administrative Behavior by Simon. This report will review these four theoretical concepts and try to analyze the gravity of influence contributed by each of the concepts to our understanding of Organizational Theory.

Four Theoretical Concepts in Organizational Theory

Scientific Management by Frederick Winslow Taylor

The main idea of scientific management is that labor and management should cooperate in the application of scientific methods, and only through that the maximum good for society can be achieved (Ivancevich et al., 2013). He stated that the management should develop a science for each element of the employee’s work, and do all of the management processes in accordance with the principle of science. While now it sounds intuitively true, it really was a radical way of thought at that time, because the norm was for the workers to be taught and train themselves to do their job using their own rule of thumb method. The implication of the ideas is also criticized by the managers and workers because the so-called scientific way of work often disregards their opinion and personal experience.

Administrative Organizational Theory by Henri Fayol

While Taylor focused on the micro viewpoint of the work method, Fayol focused on a macro perspective (Sharpe, 2006). He specified the core functions of industrial organizations to be in six categories, i.e. technical, commercial, financial, security, accounting, and managerial. The technical ability only matters the most at the lowest level, while at the higher levels, the managerial ability is the most important. This classification of functions may not be relevant to the current situation, but he underlined the rationale of the current management system. He also specified the five elements of management, i.e. planning, organizing, commanding, coordinating, and controlling. These are the elements that we still use today when we try to define management.

Bureaucracy and Organizational Structure by Max Weber

Weber’s approach to the construction of organization theory is often derived from a social and historical perspective (Lægaard, 2006). He introduced the hierarchy of authority as he sees that organization is a specific type of social relationship that has its regulation enforced by the authority of a chief, and organizational structure is the distribution of the authority (Miner, 2006). He added three reasons for a legitimized authority: traditional authority, legal rule-oriented authority, and charismatic authority.

His ideas of authority and obedience led him to research the bureaucratic structure. Weber stated that bureaucracy compares to other organizations as does the machine with nonmechanical modes of production. The bureaucratic structure is superior to any other form in precision, stability, discipline, and reliability (Ivancevich et al., 2013). This view also invited a lot of criticism, but nevertheless, the bureaucratic form remains the dominant description of the large-scale organization until now (Vibert, 2004).

Administrative Behavior by Herbert Simon

Simon tried to clarify the partial view of the previous theories and propose a more integrated view. He stated that organization theory can be observed in two ways: the basic science approach and the engineering approach (Simon, 1997). The basic science approach is related to building a factually correct description of the organizations’ behavior, while the engineering approach is related to the guide to designing an organization. He wrote that the question of the organization’s decision-making process as either sociological or psychological is a bizarre question, and compare it to the question of molecular biology is either biology or chemistry. The only right answer is both (Simon, 1997).

He also criticized the term “schools” of Organizational Theory as a competing theory rather than a building block than completes each other. The purpose is not to point out a weakness in a model, but to continue to build the knowledge of the organization in terms of the decision-making process and its consequences. This led to the behavioral model design of “Economic Man” and “Administrative Man” which tried to see the behavioral patterns (Lægaard, 2006).

Simon (1997) added that every decision involves two elements, “factual” and “value” elements. The organization members in the lower hierarchy tend to make a decision based on “the fact” he observed in the real world, while higher members typically use value elements (Lægaard, 2006).

The Most Influential Concept in Organizational Theory

Even though Scientific Management and Administrative Theory has been a target of criticism, both provided a pioneering view that stimulate the discussion. However, as a theory, both no longer provide an active theoretical thrust within organizational behavior, and they have not for a long time (Miner, 2006). Herbert Simon tried to clarify the rational behavior and provided a more comprehensive view, and his approach is the most suited to a more fast-changing modern organization. Simon was awarded Nobel Prize for his works, especially The Administrative Behavior, and this can easily be one of the most influential modern concepts of organizational behavior.

However, to this day, the work of Max Weber is arguably the most influential of the four. The concept has been criticized by many and caused much social dissatisfaction, yet it still is the most used concept in a large organizations such as government institutions as many facets of modern public administration are based on his work. The Weberian model also works in many industries and it remains the dominant description of large-scale organization until now (Vibert, 2004).


Ivancevich, J. M., Konopaske, R., & Matteson, M. T. (2013). Organizational Behavior and Management (10th ed.). McGraw-Hill Education.

Lægaard, J. (2006). Organizational Theory (1st ed.) [E-book]. Mille Bindslev & Ventus Publishing.

Miner, J. B. (2006). Organizational Behavior 3: Historical Origins, Theoretical Foundations, and the Future. M.E. Sharpe.

Simon, H. A. (1997). Administrative Behavior, 4th Edition (4th Revised ed.). Free Press.

Vibert, C. (2004). Theories of Macro Organizational Behavior. M.E. Sharpe.

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