Management 9

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MaxWeber was a renowned German philosopher, sociologist and politicaleconomist. His works on the subject of sociology theory and economicswas perhaps one of the most influential works. In fact, he isconsidered to the grandfather of sociology. Born in 1864 in Germany,Weber went on to become a University professor. In 1905, Max Weberwrote one of his most famous literature, The Protestant Ethic and theSpirit of Capitalism. Max Weber is undisputedly one of the threephilosophers of the modern times who were able to dissect the enigmaof capitalism besides Karl Marx and Adam Smith(MaxWeber, 2015).With the rise of industrial revolution, Max Weber was keen about theeffects of industrial revolution and the changes that would bebrought by it. This came on the backdrop of cities exploding and ascompanies grew in size and scale. According to Max Weber, theindustrial revolution would lead to a bureaucratic form oforganization where all that mattered was the ends. Max Weber was ofthe opinion that if bureaucracy was implemented it would enhanceoutput but at the expense of the organization’s workers. Scientificmanagement theory and human relations theories are two theories thathave been discussed as far as organizational management is concerned.Both theories take on different forms of rationalizations. Max Webercame up with four rationalization theories but in this essay only twotheories will be discussed, the formal rationality and substantiverationality(Kalberg,1980).The formal rationality focuses on the means to an end while thesubstantive rationality focuses on the value and nature of outcomes.In this essay, the author will discuss formal and substantiverationality and their relationship with scientific management andhuman relations theory.

Rationalitycan be described as a form of orientation to which reality weighs upthe means and ends of a process or an action in a pragmatic manner.Max Weber believed that human beings could explain their actions ineither four rationalizations. These were namely, practicalrationality, theoretical rationality, formal and substantiverationalities. Practical rationality dictates that individualsegotistical interest lead human beings to be practical rational.Theoretical rationality involves the use of reality through abstractconcepts as opposed to actions. In this form of rationality, humanbeings use past experiences to decide on their next course of action.In this essay, the focus will be on the latter formal and substantiverationalizations which are the subject of our discussion.

MaxWeber’s use of the term rationalization could not be translated tothe proper meaning in the English language. According to Weber, thewords zweckrational and wertrational could only be translated tosubstantive and formal rationality in English. However in German,zweckrational could be defined as a goal oriented behavior that isbased on logic and observation. While the term wertrational meant agoal orientation action that is based on outcomes or values. In otherwords, Weber believed that formal rationality was based on a means toan end rational decision. This is where one takes certain steps toachieve certain goals by utilizing observation, logic and pastexperience to achieve that goal. On the other hand, substantiverationality does not limit itself to the end but uses any methodologyto achieve its goal. Substantive rationality can sometimes beambiguous as a number of elements can be used to achieve the ultimateend. Substantive rationality focus on a holistic thinking as opposedto the quantifiable or technical oriented formal rationality (Elwell,2013).

Accordingto Weber, there was a distinction between substantive and formalrationality. Formal rationality was as a consequence of propercalculations and was quantitative. Weber insisted that an act wasrational if has structural consistency in that all the elements pointto the same direction and there was no contradiction. In formalrationalization, some contradictions are made visible throughformalization. Formal calculations are used to emphasize process asopposed to the outcome and this greatly influences the way decisionsare made. Substantive rational on the other hand focuses on theresult and if certain ends are achieved successfully. Substantiverational refers to the failure or success of actions that are aimedat achieving some non-economic or economic objectives such asequality and justice. However, due this statement may suggest thatsome can either be formal or substantive regardless of their decisionmaking process involved. It can be established that Weber was of theopinion that formal rationality was limited before the rise ofcapitalism. This is especially when it came down to bureaucraticorganizations and the law. Max Weber believed that the conditions offree market would lead to an increase in formal rationality becausethe market would need to come up with a way of quantifying values.The calculation of rational was a historic and social phenomenon. Itturned out that substantive and formal rationality coincided to ahigh degree. This was because of the competitive nature of markets inproviding better prices for calculations (Rona-Tas,2003).

Formalrationality can be better translated totechnocratic thinking whilesubstantive rationality can be translated to critical thinking in theEnglish language. Max Weber held the opinion that, the industrialrevolution that was fueled by the rise in capitalism would promotetechnocratic thinking and abandon critical thinking. Bureaucracywould dominate the modern society and the motivating factor would beto create process that would improve technical efficiency. Max Weberworry was that as companies grew the formal rationality would takeover substantive rational and this would inevitably undermine thereason why the organizations were established. In other words, formalrationalization would determine all process that would usually needsome human role.

Substantiverational can organize an area of life while leaving other areasuntouched. For example, the idea of friendship can come with valuessuch as compassion and loyalty while in a sphere like religion, theymight be various variations in the belief system however, and thevalues are more or less the same. Max Weber believed that, there wascrucial role played by religion in shaping substantive rational.Formal rationality on the other hand, relates to areas of life adominant structure that could only have been experienced withindustrialization. This was especially evident in legal matters,economics and scientific spheres. Formal rational legitimated the useof calculations to support a means to an end rational and this wasbacked up by laws, applied rules and regulations.

Scientificmanagement also known as Taylorism is a theory in management thatused in analyzing workflow or process. The management theory wasproposed by Fredrick W. Taylor who was an Engineer by profession andits main objective was to improve labor productivity. Its developmentstarted in the early 19thcentury when the industrial revolution was at its peak. Fredrick W.Taylor believed that workers work efficiently was more effective thanmaking them work hard. In order to come up a scientific managementtheory, Taylor observed the way some labourers were conducting theirjob. For example, he looked at the way labourers were shoveling,moving iron pigs and so forth and then used the data from his studiesto come up with the scientific management theory. One of thesuggestions he made in his theory was that, workers needed a breakduring and as a result worker productivity increased. In 1909,Fredrick Taylor published “The Principles of ScientificManagement.” Taylor developed four principles that he had learnedwhile working at a U.S steel factory. Fredrick W. Taylor believedthat if implemented the four principles would increase workers’productivity at work(Grimsley,2015).

Thefirst principle in Taylor’s scientific management theory was usingscientific method to analyze work and come up with the most efficientway of performing a specific task. This was in contrast to the ruleof thumb that was used previously at work. In this proposition,Taylor developed various motions such as laying breaks and shovelingand come up with the best way of completing various task. In otherwords, he found out that using calculations he could develop astandard for completing a task. The second principle was that workersshould be assigned tasks or assignments depending on their motivationand capability. In addition, workers should be trained to work atmaximum efficiency. In other words, Taylor was advocating forspecialization at work. Taylor believed that the more a worker spendsmore time with the equipment or machine the more he can becomeefficient at work. Taylor was a strong proponent of motivatingworkers with money. In his theory, he introduced “a fair day’spay for a fair day’s work”(MindTools, 2015).A worker was supposed to achieve a certain benchmark at work, if aworker surpassed the benchmark or target he was awarded with money.Workers who did not reach their targets were not rewarded as theycould not attract the same pay as workers who were more productive.The third principle was deemed at monitoring the workers’performance and in an effort to improve the workers’ efficiency atwork. The monitoring included a set of instructions from thesupervisor and feedback on the workers’ performance. Finally, inthe last principle, Fredrick Taylor encouraged the managers to spendmore time with the workers in order to allow for more training andhave some time for planning for the next day’s activities. Allthese were conducted to assist the workers become more efficient attheir task.

Humanresource theory stipulates that the employees at work are notmotivated by an array of social factors such as the sense ofbelonging and the feeling of being appreciated at work as opposed tothe notion of motivation by financial rewards. The roots of thisstudy can be traced back to the 1920’s after the infamous Hawthornestudy in Chicago, U.S was conducted. The theory established thatrelationships, attitude and the style of leadership play a crucialrole in employee’s performance in the organization. The function ofhuman resource department is to maximize employee’s performance inthe work place and while money is believed to be the primarymotivator in determining employee performance experiments under EltonMayo show the indispensability of the human factor (Perry,2011).

Twoexperiments were conducted in the Hawthorne studies in an attempt toexplain the human factor in organizations. The first experiment wasthe illuminating experiment while the second one was the bank wiringroom experiment. In the illuminating experiment, two groups wereused, the experimental and control group. Light levels were changedin the experiment group while the levels at the control group wereleft unchanged. Surprisingly, the level of production in theexperiment group and the control group increased. In the other study,the bank wiring room, male workers were involved in making electricalcomponents. The group that went set the production standards and theywere not deterred by the motivation to produce at optimum levels. Infact, the group produced under performed and the peer pressure fromother workers discouraged the group from performing their best. Thetwo experiments show that workers are not only motivated by financialrewards and that the informal side of organizations plays a crucialrole. The first experiment gave birth to what is now coined as theHawthorne Effect(Rose,2005).This is what motivates workers to perform well in the organizationwhen they feel that they are a crucial part of the organization andthat whatever they do in the organization is of interest to thecompany.

Inconclusion, it can be established that scientific management theorywhich was proposed by Fredrick W. Taylor was a good example of formalrationalization. This can be attested by the sheer resemblance of thetheory and processes to Max Weber’s methodology of calculating howtasks are executed in order to improve efficiency in industries. Onthe other hand, the human relations theory is a form of substantiverationalization. This is because the theory, attempts to apply thehuman factor in making decisions on how processes are executed atwork. In addition, the theory looks at the nature of the outcome asopposed to the ends in formal rationality which seeks to reduce humanbeings into robots or machines.


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Elwell,F. W 2013, TheIrrationality Factor.Retrieved February 16, 2015, from

Grimsley,S 2015, ScientificManagement.Retrieved February 17, 2015, from Education Portal:

Kalberg,S 1980, Max`s Weber`s Types of Rationality: Cornerstone for theAnalysis of Rationalization Processes in History. ChicagoJournals,1145-1179.

Perry,G. L 2011. HumanRelations Management Theory Basics.Retrieved February 16, 2015, from

Rona-Tas,A 2003, Thethree modalities of rationality and their contraditions inpost-communist consumer credit market.Retrieved February 15, 2015, from

Rose,N 2005, HumanRelations Theory and People Management.Retrieved February 16, 2015, from Corwin:

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