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

"Scientific management" is the label Frederick Taylor attached to the system of management devised by him. In this article we present our discovery of very different "scientific" management principles that were developed roughly concurrently with Taylorism by German physicist Ernst Abbe, then owner and managing director of the Carl Zeiss optical instruments company. Abbe's management principles as well as the social philosophy underlying them are accessible to present-day theorists because he laid them down both in the statutes of a foundation he founded and in an extensive commentary on the statutes. These original accounts offer a remarkable opportunity to enrich our current understanding of how managers can create and recreate firm capabilities that allow firms to enjoy a long-term leadership position. Abbe develops an early account for managing a science-based firm and securing its long-term competitiveness, giving detailed prescriptions with regard to the kind and scope of firm activities, its organizational setup, and its labor relations. Abbe's management principles exhibit striking parallels to important contemporary theories of organization such as the Resource-Based Theory of the Firm and the related Dynamic Capabilities Theory of the Firm, and are even today able to indicate issues that warrant further theoretical elaboration. In this article, we give an outline of Abbe's thought, highlight some of its most characteristic features, and set them into relation to present-day management theory.