Theories are important as organizers of knowledge and as road maps for action. Understanding the historical context and precursors of management and organizations provides a sense of heritage and can also help managers avoid repeating the mistakes of others. Evidence suggests that interest in management dates back thousands of years, but a scientific approach to management has emerged only in the last hundred years. During the first few decades of this century, three primary perspectives on management emerged. These are called the classical perspective, the behavioral perspective, and the quantitative perspective.

The classical management perspective had two major branches: scientific management and administrative management. Scientific management was concerned with improving efficiency and work methods for individual workers. Administrative management was more concerned with how organizations themselves should be structured and arranged for efficient operations. Both branches paid little attention to the role of the worker.

The behavioral management perspective, characterized by a concern for individual and group behavior, emerged primarily as a result of the Hawthorne studies. The human relations movement recognized the importance and potential of behavioral processes in organizations but made many overly simplistic assumptions about those processes. Organizational behavior, a more realistic outgrowth of the behavioral perspective, is of interest to many contemporary managers.

The quantitative management perspective and its two components, management science and operations management, attempt to apply quantitative techniques to decision making and problem solving. These areas are also of considerable importance to contemporary managers. Their contributions have been facilitated by the tremendous increase in the use of personal computers and integrated information networks.

The three major perspectives should be viewed in a complementary, not a contradictory, light. Each has something of value to offer. The key is understanding how to use them effectively. Two relatively recent additions to management theory, the systems and contingency perspectives, appear to have great potential both as approaches to management and as frameworks for integrating the other perspectives.

A variety of popular applied perspectives influence management practice today. Important issues and challenges facing managers include employee retention, diversity, the new workforce, organization change, ethics and social responsibility, the importance of quality, and the continued shift toward a service economy.