Question

Describe Henry Fayol’s principles of management.

Answer 1

Henri Fayol’s Principles of management:

With his rich experience and knowledge Henri Fayol presented 14 important principles of Management. They are:

1. Division of work:

• Management gives more weightage to higher efficiency of employees and managers. Division of work is one of the ways to achieve this.
• As per management principles, productivity can be increased by optimum use of production equipment. However, in addition to this division of work is necessary to increase efficiency of employees and managers.
• Henri emphasized on division of work as it can also lead to specialization along with increased productivity. Division of work should be done at both managerial level and factory level to take the advantage of specialization.

2. Authority (power) and responsibility:

• Power and responsibility are two sides of a coin. Power without responsibility and responsibility without power are incomplete.
• When a person is assigned a responsibility for some job then he should be also given some power to control that job.
• While assigning the power, different parameters like post of employees, knowledge, qualification, experience, art of leadership, maturity, etc. should be considered. This will increase the enthusiasm of employees which in turn will make it easier to attain business objectives.

3. Discipline:

• A proper discipline should be maintained for successfully attaining business objectives.
• Discipline creates harmonious environment at work place.
• In order to maintain discipline in the industry it is very important to make optimum use of equipment and to see that activities are done consistently.
• Industrial discipline can be established by setting specific rules and code of conduct. This then leads to proper administration of the unit.
• It becomes easy to manage and control the unit having more employees if proper code of conduct is established.
• It also increases work interest of employee and makes the work easy for the managers.
• Supervision, clear and appropriate contracts between workers and owners and appropriate implementation of punishments at every level are important aspects of discipline.

4. Unity of command:

• The concept of getting command from only one superior is called Unity of Command.
• Employees cannot follow orders from more than one superior. Hence this principle suggests that employee should get order from only one superior for any job or activity.
• As per this principle, an employee should be responsible to only one superior or department for a particular job.
• This principle prevents any confusion that may arise amongst employees with respect to whose order to follow. If order comes from more than one superior then it creates confusion amongst employees and hampers industrial discipline.

5. Unity of direction:

• Planning shapes the future of business. However, if activities do not go as planned, then they are re-directed and brought on the planned track.
• The directions for these things should be given by superior authority. By doing so activities can be well co-ordinated and all the tasks can be done easily.
• According to this principle there should be only one superior employee leading a particular group of employees. This group should be focused on one specific objective at a time.

6. Subordination of individual interest to the general interest:

• This principle states that ‘general interest’ is superior to ‘individual interest’.
• This principle tells that interest of whole unit should be kept in focus rather than interest of individual or group of employees.
• The manager must try to integrate the individual goal with the organizational goal in such a manner that both the objectives are accomplished with efficiency and effectiveness.

7. Remuneration of personnel:

• The return or reward given to the employees against the service they render is called remuneration.
• Fayol says that employees of company should be paid suitable and ideal wages. This makes owner-employee relation stronger.
• In a unit, all employees do not work with the same efficiency. Some employees show higher efficiency, than other. Such employees should be given more wages or rewards compared to other. This will keep the employees loyal towards the unit and stop them from leaving the job.
• The unit should also put into practice promotional schemes like bonus, profit sharing, representation in management committee, etc.

8. Centralization:

• The business unit should decide the extent of centralization or decentralization it wants to adopt so as to have proper management.
• Not delegating the powers to sub-ordinates and keeping them only in the hands of owners or top personnel is called centralization.
• Centralization is adopted when the business unit is small. This helps in making the best use of strength and abilities of employees.
• If the unit is big, it is highly advisable to leave centralization and adopt de-centralization of power.

9. Scalar chain:

• Scalar chain is the formal line of authority which moves from highest to lowest rank in a straight line. This chain specifies the route through which the information is to be communicated to the desired location/person.
• Fayol emphasized that each information in the organization must flow according to this chain to facilitate clear communication of orders of the superiors and feelings of the subordinates.
• This chain must be strictly followed in the organization.
• This principle emphasizes on creating chain from top level management to bottom level employees.
• Chain of power from higher administrative officers to bottom level employees should not be broken. .
• There should be proper delegation of powers and responsibility at respective level. Moreover, the employees of the unit should be aware of , who is responsible to whom.

10. Order:

• Here the word ‘order’ does not mean any command but it means right arrangement of things and activities.
• This principle states that there should be a proper order for everything. Fayol is of the view that in every organization there should be a fixed place for everything to facilitate smooth working and avoid wastage of resources.

Answer 2

Fayol suggests the following two types of orders in a unit:

(A) Material order:

This order specifies that there should be a proper place for all physical resources of the unit.

(B) Social order:

• This order specifies that there should be a proper place for all human resources in accordance with their designations. It states “An appointed place for every employee and each employee at his/her appointed place”.
• Skilled employees should be employed at placed at right place in the unit.

11. Equality:

• Employees are a part of managerial system.
• The employees are human beings and so the management should adopt a practical and humanitarian approach to handle them.
• Superiors should behave appropriately and uniformly while taking work from their sub-ordinates.
• The management should make efforts to establish equality in unit informally father than through legal or traditional ways.
• This principle believes that behaviour of employees is based on faithfulness, attitude, uniformity and justice in the unit.

12. Stability of tenure of personnel:

• ‘Stability’ means no frequent change, termination and transfer, etc.
• This principle says that in an organization whenever an employee is appointed for a job, he/she should not be removed or transferred from that position frequently.
• Permanent and stable employees are asset of any business unit.
• An employee can develop himself by remaining in unit and contributing in the achievement of goals of the business unit.
• Moreover, as the employee remains for long time in the unit, his knowledge of system of work in the unit leads to more productivity. This also reduces ‘ labor turnover rate.

13. Initiative:

• ‘Initiative’ means to start, to begin or to instruct in a project.
• Here, in this principle Fayol suggested that each employee should be given an opportunity to take some initiative in framing the functional plan as well as in determining the steps to be taken at each level for proper execution of the plan.
• Industrialists should provide such atmosphere that employees can enthusiastically participate in initiation.
• Initiation improves ability of independent working of an employee and inculcates their leadership qualities.

14. Esprit de Corps (Feeling of Oneness):

• Esprit de Corps means team spirit and team work, the feeling of oneness.
• Success of an industrial unit lies in mutual relations of managers and employees. Owing to this fact there should be harmony in both classes.
• Managers should generate group feeling among. employees. They should instill in the minds of employees that by working together they can achieve the goal easily and quickly.
• Henri Fayol said that ‘Above list is not last list of management principles. Managers can add new principles based on their experience, research and knowledge. These principles can be implemented in all kind of activities like business, economic, political and social.’