Scientific Management, Welfare Capitalism, and Organizational Culture

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The emerging information society predetermines a new order of social management, built on the active participation of subjects in broad information about all aspects of management activities, assuming the presence of feedback. A characteristic feature is social technologies in the management system: their essence, forms, and components. This type of technology is adequate to the prevailing conditions and contributes to the rapid dissemination of information, ideas, opinions, competencies and is also associated with the search for practical management tools and methods. In the system of state-society relations, such technologies acquire particular importance. Management technologies, in this case, make it possible to influence the development of social processes within the competence of the state, to correct management decisions promptly. This paper will analyze the essence and features of such rhetorics, as scientific management, welfare capitalism, and organizational culture.

The Concept of Managerial Discourse

The interpretation of social management in this context emphasizes its communicative nature, bringing to the fore the ability of the state to interact with society using technologies that can collectively be called managerial discourse. The concept of discourse, which has recently gained particular popularity, is interpreted in this context as a specific structure or order of speech that exists in a specific area or social situation (Barley et al., 1992). Managerial activity is considered social communication, which is not only formed based on the actual discourse but also influenced by external social factors. Thus, organizational discourse is a technology of communicative interaction of various social groups, permeating all spheres and levels in the relations system between society and the state. Its study by sociological means is necessary because it contributes to a more in-depth understanding of the specifics of communication in the field of public administration and, accordingly, its optimization.

Scientific Management

The creator of the scientific management approach was F. Taylor, who thought of organizing work involving the use of rules, laws, and formulas that replace the personal judgments of an individual employee. Taylor believed that statistical accounting and measuring the impact of various rules and procedures would have a beneficial effect on their successful use (Lowood, 2020). Scientific management directs its efforts to explain the nature of managerial work, establishes links between cause and effect, identifies factors and conditions under which people’s joint work turns out to be both more practical and more effective (Davis, 2017). The scientific basis of management is the sum of knowledge about management in the form of concepts, theories, principles, methods, and forms of management of people and their groups in the production of goods.

Thanks to scientific developments in management, management has been recognized as an independent field of scientific research. It has been proved that the methods used in science and technology can be effectively used in the practice of organizations to achieve the intended goals. The definition of management as a science emphasizes the importance of orderly knowledge about management. This knowledge makes it possible not only to manage current affairs in a timely and high-quality manner but also to predict the development of events and, by this, develop the strategy and policy of organizations. Therefore, the science of management develops its theory, the content of which are the laws and laws, principles, functions, forms, and methods of purposeful activity of people in the process of management.

Based on Taylor’s beliefs, it was necessary to change management principles and implement them in strict accordance with scientific recommendations. In place of decisions based on practice and tradition, procedures developed based on a thorough study of specific situations should occur. Solving this problem, F. Taylor analyzed the time spent performing individual operations for unloading railway wagons with iron ore and loading finished products. The analysis results showed that eliminating unnecessary movements in the labor process, the use of more advanced equipment and a change in the procedure would increase the productivity of each three times.

The use of new approaches made it possible to develop standard procedures:

  • Labor organization by type of activity.
  • Selection of employees with appropriate abilities.
  • Training in effective labor methods.
  • Ensuring the process of completing work assignments and eliminating possible obstacles.
  • Financial incentives.

The practical application of the principles of scientific management has made it possible to increase labor productivity. However, insufficient attention to the growing needs of employees and the social context of work has led to increased conflict between management and workers. The spread of scientific management contributed to more intensive exploitation of employees, which did not contribute to the cooperation of managers and workers. The goal set by this strategy is formulated as an increase in the rationality of decisions. A group of representatives of this strategy developed another concept: quantitative assessment and mathematical modeling of economic processes (McKillop & McKillop, 2018). As a result, econometrics emerged as a method of analyzing and programming economic activity.

The Concept of Paternalism or Welfare Capitalism

Traditionally, in the conditions of long-term labor contracts and permanent employment, the employer includes in the incentive system several benefits that usually do not have monetary expression and are not related to the employee’s labor contribution. Social services for employees of enterprises in the form of kindergartens, rest homes, sanatoriums, housing, and in some cases, financial assistance are meant. These services are a kind of good that bypasses direct economic rationality (Aspalter, 2017). In a broader context, such relationships are based on certain forms of social exchange at the enterprise level. In exchange for social benefits, the employer receives loyalty and personal loyalty. Such a management program is known in the literature on social policy, management, and sociology as paternalism or welfare capitalism.

Industrial paternalism is a labor relation that functions according to patterns associated with a patriarchal community or a large family. In such a “family,” there is usually a benefactor Father and his Children – workers who receive support and assistance on a wide range of problems (Hicks, 2018). Such relations are characterized by the importance of the collective over the individual, a rigid internal hierarchy, sometimes supported by the charisma of a person invested with power, non-monetary forms of labor motivation. Paternalism is expressed in industrial relations, managerial tradition, management perception stereotypes, and enterprise structure features.

Paternalism as a system of interdependencies and a social exchange mechanism is a feature of many economic systems in history and modern society. Sociocultural interpretation of paternalism as a type of management and labor relations expands the concept of industrial conflict, defining specific structural, cultural, and ideological forms of its expression and development (Manow et al., 2018). Paternalistic relations have an asymmetric structure since the actions of managers and employees’ responses are not necessarily coordinated to maintain the existing patriarchal system. Paternalism in the labor sphere results in forming a society consisting of individuals with limited independence and responsibility for actions. There is a significant similarity between paternalism and religious attitudes to the transfer of commitment from the sphere of personal experience to the outside.

Thus, paternalism refers to relationships similar to those in the patriarchal community, where ties were built as if within the framework of a large family. Such relations are characterized by the priority of the collective over the individual, a rigid internal hierarchy, sometimes reinforced by the charisma of a person invested with power, non-monetary forms of relations. It is also the sphere of subordination, execution of orders of the administration, and stereotypical forms of perception of management. In addition, it is a system of interactions in production, vertical and horizontal connections.

The interactions under consideration are a broader concept than specific political steps and management strategies. They act as social norms of behavior and motivation at different levels of production. Paternalism is the attitude of superiors to subordinates, manifested in management: unique methods of pressure, control, the form of submitting their decisions, the perception of labor collectives. These two social practices are in unity and connection with each other, although they can be reproduced and understood in different ways by superiors and subordinates.

Organizational Culture

Since culture plays a significant role in the life of an organization, it should be the subject of close attention from the management. Management not only corresponds to the organizational culture and strongly depends on it but also can, in turn, influence the formation and development of organizational culture (Felipe et al., 2017). To achieve this, managers should analyze the organizational culture, affect its appearance, and change in the desired direction (Al-Ali et al., 2017). Organizational culture creates the “inner, spiritual core,” promotes team cohesion, forms employees’ feelings of awareness and responsibility for their work.

For the first time, the concept of organizational culture was introduced in the late 70s in connection with the attempts of American scientists to comprehend the successes of the Japanese economy and respond to the “Japanese challenge” (Soomro & Shah, 2019). Organizational culture is focused on the internal environment and is manifested primarily and mainly in the organizational behavior of employees. Organizational culture includes not only global norms and rules but also the current regulations of activity (Elsbach, & Stigliani, 2018). It may have its characteristics, depending on the type of activity, a form of ownership, position in the market, or society. In this context, it is possible to talk about the existence of bureaucratic, entrepreneurial, organic, and other organizational cultures and organizational culture in some regions of activity.

Concerning the organization, culture performs several essential functions. The security function is to create a barrier that protects the organization from undesirable external influences. It is implemented through various prohibitions, “taboos,” limiting norms. The integrating function forms a sense of belonging to the organization, pride in it, the desire of outsiders to join it. The regulatory process supports the necessary rules and norms of behavior of members of organizations, their relationships, and contacts with the outside world, which guarantees its stability and reduces the possibility of undesirable conflicts.

The adaptive function facilitates the mutual adaptation of people to each other and the organization. It is implemented through general norms of behavior, rituals, rituals, with the help of which the education of employees is also carried out. By participating in joint events, adhering to the same behaviors, people find it easier to contact each other. The orienting function of culture directs the activities of the organization and its participants in the necessary direction. Culture permeates the management process from beginning to end and plays a massive role in communication, conditioning the logic of thinking, perception, and interpretation.

Thus, an organization’s culture is defined as a set of values, norms, behaviors, attitudes, traditions, and habits inherent in a particular organization. Organizational culture is the internal environment of the company’s employees, the system of their connections, interactions, and relationships carried out within the framework of specific business activity (Paais & Pattiruhu, 2020). Organizational culture includes behavioral styles and reactions to the environment and ways of organizing business (Warrick, 2017). Organizational culture is a complex social phenomenon formed within an organization under the influence of many factors (Su, 2017). It develops a long-term, sustainable motivation of personnel focused on achieving the organization’s strategic goals, which is an integral part of strategic management.


Summing up all the above, it is possible to conclude that the three listed rhetorical methods have had a massive impact on the development of the modern economy. The methods and practices that shape these rhetorics have changed over the years, but their essence has remained unchanged. The only shift that has occurred in the elements of these approaches to management is their industrialization. The method of scientific management allowed this phenomenon to be formed as an independent science. Paternalism has significantly affected the relationship between employees and employers, developing a separate way of doing business. Organizational culture largely determines a particular organization’s external and internal world, a vital element of any corporation. Thus, it becomes evident that these approaches have not disappeared anywhere but have only been adopted in connection with the new time requirements.


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