Rational Goal Model

Internal Process Model

The internal process model introduced by Henri Fayol (1841–1925) in the first quarter of the twentieth century stresses the importance of managerial internal control that results from the exercise of the monitor and coordinator role responsibilities in order to exert authority over humans to maintain the stability of hierarchic administration. Operational efficiency is achieved through information management, documentation control, and consolidated continuity and by emphasizing process measurement, smooth functioning of organizational operations, and the maintenance of structural order (Fayol 1916). Fayol described the five functions of management as planning, organizing, commanding, coordinating, and controlling and laid down fourteen principles of good administration, with the most important elements being specialization of labor, unity and chain of command, and the routine exercise of authority to ensure internal control.

Another key exponent of operational efficiency in managing large groups was the sociologist Max Weber (1864–1920), who described and advocated the indispensability of bureaucracy. Weber's ideal bureaucracy included authority, hierarchy, formal rules and regulations, and impersonality in rule application. His ideal bureaucrat neutrally and efficiently manages by the book and follows orders from above even if they go against his or her personal convictions.

When the internal process model is applied to politico-economic control, socialist and communist regulatory infrastructures constrain the negative externalities of the free market but create the risk of stifling technological and politico-economic innovations through overregulation. The strength of this model is that it accounts for managers' maintaining structure and collecting information. The exclusive and extreme emphasis on the internal process model, however, results in stifled progress and neglected possibilities at the organizational and extraorganizational levels.