Chester Barnard and the Systems Approach to Nurturing Organizations

Andrea Gabor and Joseph T. Mahoney
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Andrea Gabor: Baruch College, City University of New York
Joseph T. Mahoney: University of Illinois at Urbana-Champaign

Working Papers from University of Illinois at Urbana-Champaign, College of Business

Abstract: Chester Barnard was best known as the author of The Functions of the Executive, perhaps the 20th century's most influential book on management and leadership. Barnard offers a systems approach to the study of organization, which contains a psychological theory of motivation and behavior, a sociological theory of cooperation and complex inter--dependencies, and an ideology based on a meritocracy. Barnard's teachings drew on personal insights as a senior executive of ATT in the 1920s and 1930s, and he emphasized the role of the manager as both a professional and as a steward of the corporation. For leadership to be effective, it had to be perceived as legitimate, Barnard maintained. Barnard sensed that the central challenge of management was balancing both the technological and human dimensions of organization. The challenge for the executive was to communicate organizational goals and to win the cooperation of both the formal and the informal organization; but he cautioned against relying exclusively on incentive schemes to win that cooperation. Responsibility--in terms of the honor and faithfulness with which managers carry out their responsibilities--is the most important function of the executive.

Date: 2010
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