19 The Industrial Revolution saw work shift from family-led home production to factory production. Prior to the Industrial Revolution, goods and services lacked standardization and were produced at home in small batches. 18 The Industrial Revolution saw the emergence of the modern corporation, in which work, usually in a factory setting, was specialized and coordinated by managers. 17 All of these factors played a role in the Industrial Revolution, which occurred between 17. The steam engine lowered production and transportation costs, thus lowering prices and allowing products to reach more distant markets. Thirdly, the need to coordinate all these different tasks required a greater emphasis on management.Īnother significant part of the Industrial Revolution involved the development of the steam engine, which played a major role in improving the transportation of goods and raw materials. Instead of learning every aspect of a task, workers needed to learn one portion of it. Secondly, it drastically reduced the need for training. ![]() Firstly, specialization drastically reduced the cost of goods. The idea of specialization of labor had several important outcomes. The division of labor meant that a worker specialized in performing one task that was part of a larger series of tasks, at the end of which a product would be produced. Specialization and division of labor were Smith’s major contributions to management thought. 15 In his masterpiece, The Wealth of Nations, 16 Smith proposed the idea of specialization and coordination within corporations as a source of economic growth. One of the major intellectual leaders of this period was the economist and moral philosopher Adam Smith. The market would coordinate the actions and activities of various participants, thus allowing resources to flow to their most efficient uses. This further development of trade led to the establishment of the marketplace as a dominant means of organizing the exchange of goods. The Hudson’s Bay Company orchestrated fur trade in Canada where pelts were produced and then shipped to England for trade in any part of the globe. The 18th century saw the emergence of various international corporations, such as the Hudson’s Bay Company 13 and the East India Company, 14 which conducted business globally. As the British Empire’s power grew, so did opportunities for trade. ![]() The emergence of British power would spawn the third major advance in management, the Industrial Revolution. ![]() 11 It was during this time that the word management came into the English language from Italy through translations by John Florio, 12 an Anglo-Italian member of Queen Elizabeth’s court. The Renaissance and its ideals came to England, a backwater power at the time, during the reign of the Tudors (1485–1603). How did the Industrial Revolution affect the progression of management theory?.
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