Classic Organizational Theory Basics

• Classic Organizational Theory consists of four key principles: Finding the most efficient way to complete a task; matching each person with the tasks for which he is most qualified; careful employee supervision, and meticulous planning. By closely adhering to each of these principles, many corporations that existed at the turn of the century were able to increase productivity and maximize profits.
  
  

Classic Organizational Theory Criticisms

• Since Classic Organizational Theory emphasized the needs of the organization over those of individual employees, it has drawn criticism from detractors of bureaucracies. Although this theory promotes skill-based advancement and experience-based divisions of labor, critics feel it makes organizations out to be infallible and places too much importance on stringent bureaucratic rules.
  
  

Contemporary Organizational Theory Basics

• Contemporary Organizational Theory stresses the idea that an organization will prosper as long as its individual members are kept happy. Setting itself apart from Classical Organization Theory, Contemporary Organizational Theory emphasizes the needs of individuals and encourages higher-ups to closely study what workers want. The creation of human resources departments is attributed to the popularization of this theory.
  
  

Contemporary Organizational Theory Criticisms

• Some critics feel that Contemporary Organizational Theory fails to create a clear-cut hierarchy within an organization, resulting in too much employee freedom. Additionally, opponents of Contemporary Organizational Theory argue that placing employee needs before those of the corporation decreases productivity and makes managers and other higher-ups appear less authoritative in the eyes of their subordinates.