Ernst Abbe's Scientific Management: Theoretical Insights from a 19th Century Dynamic Capabilities Approach

Abstract

"Scientific management" is the label Frederick Taylor attached to the system of shop-floor management devised by him. In this article, we present our discovery of very different "scientific" management principles that, roughly concurrently with Taylorism, were developed by German physicist-manager Ernst Abbe and that are codified in the statutes of the Carl Zeiss foundation created by Abbe. They exhibit striking parallels to Resource- and Capability-Based Theories of the Firm, and indicate managerial challenges that warrant further theoretical elaboration. Abbe develops an account for managing a science-based firm and securing its long-term competitiveness, giving detailed prescriptions with regard to the type and scope of a firm's activities, its organizational setup, and its labor relations. We highlight some of the most characteristic features of Abbe's thought, discuss its effects on the development of the firms owned by the Zeiss foundation, and compare it to and draw out implications for present-day management theory.

Keywords: Resource-based theory of the firm, dynamic capabilities, scientific management, sustainable competitiveness, corporate governance

JEL Classification: B19, J50, L20, M10