Henri Fayol 14 Principles of Management

INTRODUCTION

Management principles are the statements of fundamental truth based on logic which provides guidelines for managerial decision making and actions.

A principle means a fundamental truth on the basis of reasoning, a primary element of general law.

HENRY FAYOL  has given the fourteen principles of management. He has made a distinction between management principles and management elements. Management principles is a fundamental truth and establish cause-effect relationships while management element denotes the function performed by a merger.

Define Management

“Management is the process of designing & maintaining an environment in which individuals, working in groups, efficiently accomplish selected aims”.

HISTORY: HENRI FAYOL

HENRI FAYOL (1841 – 1925) was a French coal-mine engineer, director of mines and modern management theoretician. His scientific management theory forms the base for business administration and business management. In the academic world, this is also known as fayolism. HENRI FAYOL provided one of the most influential modern management concepts of his time. He is the founder of the 14 principles of management and the five functions of management.

FAYOL’S 14 PRINCIPLES OF MANAGEMENT

(1) DIVISION OF WORK

The work is divided in such a way that it promotes specialization and one person does only one thing rather than doing everything himself

Work should be divided among individuals and groups to ensure that effort and attention are focused on special portions of the task. Fayol presented work specialization as the best way to use the human resources of the organization.

(2) PARITY BETWEEN AUTHORITY AND RESPONSIBILITY

The concepts of authority and responsibility are closed related. Authority was defined by Fayol as the right to give orders and the power to exact obedience. Responsibility involves being accountable and is therefore naturally associated with authority. Whoever assumes authority also assumes responsibility.

Authority and responsibility go side by side and should be commensurate to each other.

(3) DISCIPLINE

A successful organization requires the common effort of workers. Penalties should be applied judiciously to encourage this common effort.

Discipline id obtained through judicial applications of penalties. Limites of acceptable behavior are absolutely necessary to define if everyone in the organization knows what can and can not be done.

(4) UNITY OF COMMAND

Unity of command provides that an employee is responsible for only one supervisor, who in turn is responsible for only one supervisor, and so on up the organizational hierarchy. This is true even if the top of the organization is led by a group of people. For example, imagine you are the CEO of a technology firm in Silicon Valley. While the board of directors of your company govern the policy-making and strategic planning, under the concept of the unity of command, you do not answer to all members of the board, but only the chairman of the board.

(5) UNITY OF DIRECTION

The entire organization should be moving towards a common objective in a common direction.

There should be one head and one plan for a group of activities having the same objectives.

(6) SUBORDINATION OF INDIVIDUAL INTEREST TO GENERAL INTEREST

The interests of one person should not take priority over the interests of the organization as a whole.

Fayol was of the opinion that the interest of one employee or a group of employees should not prevail the interest of the enterprise as a whole.management should make efforts to reconcile individual interests with common interests.

(7) REMUNERATION

Many variables, such as cost of living, supply of qualified personnel, general business conditions, and success of the business, should be considered in determining a worker’s rate of pay.

Fayol wanted the remuneration to be paid to employees to be just and fair and should afford maximum satisfaction to both employees and the employer.

(8) EFFECTIVE CENTRALIZATION

Fayol defined centralization as lowering the importance of the subordinate role. Decentralization is increasing its importance. the degree to which centralization or decentralization should be adopted depends on the specific organization in which the manager is working.

(9) SCALAR CHAIN

Manager in hierarchies is part of a chain like authority scale. Each manager, from the first line supervisor to the president, possess certain amounts of authority. The president possesses the most authority; the first line supervisor the least. Lower-level managers should always keep upper-level managers informed of their work activities. The existence of a scalar chain and adherence to it is necessary it the organization is to be successful.

(10) ORDER

It means the right man in the right job and the right material in the right place. Material order means a proper place for everything and everything in its right place.

(11) EQUITY

All employees should be treated as equally as possible.

It means justice and kindness. Fayol was the opinion that to encourage workers to fulfill their duties with devotion and loyalty, management should deal with the workers with equity-based on kindness and justice.

(12) STABILITY OF TENURE OF PERSONNEL

Retaining productive employees should always be a high priority for management. Recruitment and selection costs, as well as increased product-reject rates, are usually associated with hiring new workers.

(13) INITIATIVE

Employees should be given the chance and opportunity in taking initiative in deciding and implementing the plans.

Management should take steps to encourage worker initiative, which is defined as new or additional work activity is undertaken through self-direction.

(14) ESPIRIT DE CORPS

It refers to harmony and mutual understanding among the member of the organization.

Management should encourage harmony and general good feelings among employees.