Lesson notes, exercises, downloads, and recommended reading are below the video. On mobile, the video will rescale when you play it.

Chester Barnard: Organizations as Networks of People

Chester Barnard was a Harvard economist and follower of Max Weber. And he was one of the few major management thinkers who actually held a senior line management position! He spent all of his working life at American Telephone and Telegraph (AT&T).

Watching this video is worth 1 Management Courses CPD Point*.
(See below for more details)

The Nature of Organizations
This video is part of course module number 6.1.5
Program 6: Managing within Organizations
Course 1: The Nature of Organizations
Section 5: Masters of Organizations

Other videos in this section include:
🎬 Max Weber: The Father of Organizational Theory https://youtu.be/dAsiS_ignIQ
🎬 Harold Geneen: Data-driven Charismatic Organization https://youtu.be/QrF82M9aVQc
🎬 Edgar Schein: The Master of Organizational Culture https://youtu.be/TMqTN4fGb1k
🎬 Charles Handy: Philosopher of Organizations https://youtu.be/kCkXc-hPsbg
🎬 Kim Cameron: Positive Organizational Scholarship https://youtu.be/N2QxvQ5t2Lo


Chester Barnard was focused on the interconnectedness of organizations and the involvement of executives, employees, suppliers, customers, and investors.

In many ways, he anticipated ideas like Porter’s 5 Forces and the conception of stakeholders of men like E Merrick Dodd, Frank W Abrams, and Igor Ansoff.

Barnard’s basic idea is simple.
People have their own individual motivations. But, when we come together to work towards common goals (or purpose), we become an organization.
The organization then needs to prompt further willingness to collaborate, with incentives. This is especially so when the purpose of the organization differs in some way from the goals of its individual members.

Barnard also focused on the need for effective communication:
• A formal channel of communication to link every member to the organization
• Everyone understands the channels of communication
• Communication channels short be as short and direct as possible

He believed that large organizations are made up of lots of small organizations – thus anticipating ideas around ad hocracy and holacracy! Smaller groupings can operate with less formality and therefore greater speed. But, as they grow, they have to establish more formal systems, to ensure everyone understands and focuses on the same goals.

How effective is communication in your organization? Assess it by reference to are Chester Barnard’s three criteria. (3 MC CPD Points)

Free Resources
– CPD Tools – https://gum.co/MC-CPD
Paid resources
– Management Courses Onboarding Kit – https://gum.co/MC-ObK ($3)


Chester Barnard’s book, ‘The Functions of the Executive’ is not available. But the book, ‘Management Theory by Chester Barnard: An Introduction’ explains his ideas well

Also look at:

– Understanding Organizations https://geni.us/oB774Do
– Images of Organization https://geni.us/hrOemEs
– Inside Organizations: 21 Ideas for Managers https://geni.us/YwwL

Managers Need a Basic set of kit to do your job well. Here are my top recommendations: https://kit.co/MikeClayton/manager-s-work-kit (the links are affiliated)

Management Courses Continuing Professional Development (CPD) Points
You can record your Management Courses CPD points on our free, downloadable CPD record log.
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Each video has two levels of MC CPD points. For this video:
– If you simply watched the video, record 1 MC CPD point
– If you also carried out all of the recommended exercises, score a total of Y MC CPD points

Links to our book recommendations are affiliated through Amazon

#OrganizationalCulture #ManagementCourses #ChesterBarnard


A Thorough Introduction to Organizational Culture [Compilation]
Introduction to Organizations: A Compilation of our Introductory Videos
What is Globalization?
Kim Cameron: Positive Organizational Scholarship
Charles Handy: Philosopher of Organizations
Edgar Schein: The Master of Organizational Culture
Harold Geneen: Data-driven Charismatic Organization
Max Weber: The Father of Organizational Theory
How we Work: Geert Hofstede’s 6 Cross-Organization Cultural Dimensions
National Culture within an Organization: Geert Hofstede’s 6 Cultural Dimensions
Quinn and Cameron: Competing Values Model of Organizational Culture
Edgar Schein’s 3 Levels of Organizational Culture
Cultural Web: Johnson & Scholes on Where Culture Originates
Introduction to Organizational Culture
Empowerment: The Organization Giving up its Power
French and Raven: Social Power Bases in Organizations
Power in Organizations: The Power of Governance
Robin Fincham: Three Levels of Organizational Power
Amitai Etzioni: How Organizations Secure Compliance
Organizational Power: What is Power?
Virtual Organizations
Brian Robertson’s Holacracy Organizational Model
The Agile Organization
Adhocracy Organizational Model
Peter Senge’s Learning Organization
The Matrix Organization Model
Charles Handy’s Triple-I Company
Charles Handy’s Federal Organization Model
Charles Handy’s Shamrock Organization
Charles Handy’s Gods of Management
Henry Mintzberg’s 4 plus 2 Organizational Types
Edgar Schein’s Two Organizational Cultures
Why do we need Organizations? Structure vs Agility
The Features of Organizations: What an Organization Needs
Organizations as Processes: Understanding an Organization as a Set of Processes
Organizations as Structures: Understanding an Organization as a Structure
Morgan’s 8 Organizational Metaphors: An Organization is Like a…
What is an Organization? – the Nature of Organizations

Mike Clayton

About Mike Clayton 

Dr Mike Clayton is a (former) Project Manager and now a management educator. Having trained thousands of people at live workshops, seminars, and conferences, he now delivers training mainly via video. He has 14 books with international publishers and runs two successful YouTube channels. He is also the founder of OnlinePMCourses.com

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