CHESTER BARNARD

Who is Chester Irving Barnard? Why we choosed him? Previously, he was a tele-communication Executive and the most important, he is the author of 'Functions of The Executives'. Which means, he presented a theory of organization and the functions of executives in organisations.

Personal Info
- born in 1886.
- died in 1961.
- previously, was Chief Executive Officer of New Jersey Bell Telephone.

He has developed 2 concepts in Management Theory.

1. Strategic Planning
- the formulation of major plan or strategies to pursuit of major objectives.

- 3 top functions:-
i. establish and maintain an effective communication system.

ii. hire the experienced and suitable personnel.

iii. motivate those personnel.

2. Acceptance Theory of Authority
- managers have more authority than employees. It suggested that authority flows
downward but depends on acceptance by the subordinate.

- it depends on 4 conditions:-

i. employees can and do understand the communication.
ii. employees must be able to follow any instruction given by a Manager.
iii. employees must think that the directive is in keeping with organizational objectives.
iv. employees must think that the directive is not contrary to their personal goals.

When Chester Barnard retired as the CEO of New Jersey Bell Telephone, he has recorded his theories about management in his book, 'Functions of The Executive'. His main objective is to discuss the functions of the executive which means that everyone must have their own perspective and not to deriving them from a conception of co-operative systems based on previous concepts.

'The Functions of the Executive', by Chester Barnard.

3 essential elements in an organization :-

1. Communication.

2. Persons willing to contribute action.

3. A common purpose (function).

If existence is dependent on these factors, continued existence is dependent on organizational effectiveness or efficency. Organization is an impersonal system of coordinated human efforts.

1. Willingness to Cooperate
- definition: 'self-abnegation, which means the surrender of control of personal conduct and the
depersonalization of personal action.
- causes cohesion of effort. Willingness ranges in intensity among the individuals in the
organization.
- personal willingness is constantly fluctuating, therefore agregate willingness in organization is
unstable.

2. Purpose
- Willingness is unable to develop with a purpose which is accepted by all those in the
organization.
- 2 views of purpose : 1) the cooperative aspect: what the action asked of the
individual means in the context of the organization as a whole and 2) subjective aspect : what
the action means , personally, to the individual.

3. Communication
- catalyst for those with common purpose to realize potentialities. 'communication technique
shapes the form and the internal economy of organization'.

4. Organizational Effeciency
- Survival depends on ability to carry out purpose. Destroys itself by accomplishing its purpose,
hence may require adoption of new purpose.
- effeciency definition : 'effeciency relative to the securing of necessary personal contributions
to the cooperative system.'
- Barnard says material inducements insufficient over extended time. Attempt to maintain
non-economic inducements: pride of craft/accomplishment, ect.

Barnard was not an academic; his theories were put together painstakingly from decades of organizational experience. In this aspect, he is rather unique among management scholars of the twentieth century. However, during the last several years, Barnard's stature in the realm of management theory and practice has gradually waned. Although his book is required reading in the occasional Doctoral curriculum, it has more or less disappeared from the mainstream of management literature. He is infrequently cited, and credited with originating the "Acceptance Theory of Authority", but not much else.