In the field of management, Henri fayol 14 principles of management remain a fundamental guide for achieving effective organizational leadership. Developed by Fayol in the early 20th century, these principles continue to offer valuable insights for today’s managers.
Contribution of Henri Fayol
Henri Fayol was a major contributor to the administrative management approach. The world of management acknowledges Henri Fayol, a French industrialist, as the genuine originator of modern management. He was a mining engineer and worked in all positions to the position of Managing Director in a coal mining company.
In 1916, he published his book ‘Administration Industrielle et Générale’ in the French language, condensing his practical experiences and insights within its pages. The English translation of the work occurred in 1929, and its public release in the U.S.A. followed in 1949. Fayol’s perspective on managing the problem was management-centric, unlike Taylor, who focused on the worker’s point of view.
Fayol divided the activities of an industry into six groups, i.e., technical, commercial, financial, and security, accounting and managerial. These activities are common to all organisations, whether big or small. He devoted his book only to the sixth activity i.e., managing.
Henri fayol 14 Principles of Management
The list below presents the 14 principles of management:
- Division of Labour
- Parity of Authority and Responsibility
- Unity of Command
- Unity of Direction
- Subordination of Individual Interest to General Interest
- Fair Remuneration to Employees
- Centralisation and Decentralisation
- Scalar Chain
- Stability of Tenure
- Esprit de Corps
The explanation of the 14 principles of management is as follows:
1) Division of Labour
Division of labour leads to specialisation which increases the efficiency of individual employees. According to Fayol, the division and distribution of work across multiple individuals was essential. Breaking tasks into smaller subdivisions simplifies each one, leading to increased efficiency. Repeating a small part of the work helps individuals gain speed and accuracy in their performance. This principle is relevant to both technical and managerial tasks.
2) Parity of Authority and Responsibility
Authority refers to the right of a superior to give orders to subordinates, make decisions on specified matters, use resources of the organization, and guide and regulate the behaviour of subordinates. Responsibility, on the other hand, includes obligation concerning the performance of functions and achieving goals satisfactorily. The principle of parity implies a balance between authority and responsibility. Granting authority without accompanying responsibility can result in arbitrary and thoughtless exercise of power.
Likewise, when assigning someone a responsibility, it is essential to provide them with sufficient authority. Lack of necessary authority will make the individual ineffective.
Discipline in the context of management means obedience, proper conduct towards others, and compliance with the rules and regulations of the organisation. The smooth running of business requires discipline. Discipline is important for both employees and management. It’s easier to maintain when there are competent supervisors, clear rules, and fair penalties in place.
4) Unity of Command
This principle states that a subordinate should receive orders and be accountable to one and only one superior. Each employee should receive instructions from only one person to prevent confusion and conflicts. The principle of unity of command refers to the need for each subordinate to be accountable to one and only one superior.
5) Unity of Direction
According to this principle, the organization should ensure that all its members work together to achieve common objectives. The principle seeks to ensure “unity of action, coordination of strength and focusing of effort”. To achieve this, a group of activities with the same objectives should have a single head and one plan. For example, The production department must operate under a unified plan, and all employees must strive to attain predetermined production goals in terms of both quantity and quality. This principle, known as the unity of direction, stresses the importance of having all individuals in a group activity follow a shared goal, guided by a single leader.
6) Subordination of Individual Interest to General Interest
What is in the interest of the organisation as a whole must take precedence over the interest of individuals. Generally, the effort should be to bring about a convergence of general and individual interests. However, in the event of a conflict, individuals should be willing to make sacrifices for the greater good.
7) Fair Remuneration to Employees
In Fayol’s view remuneration of employees should be fair and reasonable. To treat employees fairly, the determination of wages should consider factors such as the assigned work, the cost of living, the financial position of the business, and average wage rates for similar industry roles. The fixing of basic wages can be based on work output, but a provision for allowances to accommodate changes in the cost of living is essential.
8) Centralisation and Decentralisation
Centralisation is evident when top management possesses most of the decision making authority. When managers at lower levels of management participate, it results in a decrease in the extent of such authority. Sharing authority downwards leads to decentralisation. Fayol says that an organisation should strive to achieve a balance between complete centralisation and decentralisation. In small organizations with a limited scope of activities, greater centralization is feasible. However, In large organizations, there is a need to decrease the level of centralization.
9) Scalar Chain
Fayol defines a scalar chain as the chain of superiors ranging from the top management to the lowest ranks. The chain also determines the line of authority. Managers, from the top to the bottom, are in a linked network within their positions. Each manager is superior to a manager below him but he is also subordinate to his superior. Thus, all managers are linked step-wise through a chain. The principle of the scalar chain suggests that there should be a clear chain of command, linking managers at all levels from top to bottom.
The scalar chain functions as both a chain of command and a chain of communication. It is regarded as a chain of command because orders or instructions issued at higher levels flow through intermediate managers before reaching lower levels.
The scalar chain also functions as a chain of communication because all communications, written or oral are required to flow through the chain in the hierarchy. When a supervisor writes a report for the department head, the report must be communicated through a chain of supervisors, each passing it on to their immediate superior, until it reaches the department head.
- nature of marketing
- difference between questionnaire and schedule
- features of marginal costing
- placement in hrm
- limitations of marginal costing
- nature of leadership
- difference between advertising and personal selling
It is subject to certain limitations. They are:
i) Communication takes too long a time as the order flows from the top to the bottom of the chain.
ii) There is a possibility of distortion of messages in the course of their transmission. However, a ‘gangplank’ may be created by passing the established line of authority to allow quick communication and swift action as shown in the image.
In the image, the scalar chain in an organisation is represented by two ladders, ie, A to F and A to P. Any communication from F to P has to flow upwards to A through E, D, C, and B then downwards through L, M, N, and O. It will take a long time. So, to minimise the delay involved in communication, a gangplank between F and P may be created as shown by the dotted line. However, using the gangplank should not be a regular practice, as it can disrupt the established chain of command.
This principle pertains to organizing both objects and individuals. In terms of material order, everything should have a designated place, and it should always be in its designated place. Similarly, in the social order, there should be the right man in the right place. Maintaining this order requires a deep understanding of the organization’s human needs and resources. It involves continually balancing these needs and resources to ensure harmony. Normally, the bigger the size of the organisation, the more difficult this balance is.
The principle of equity suggests that similar treatment is assured to people in similar positions. For example, Employees in similar roles should receive equal pay. The equity principle implies that managers should be fair and impartial while dealing with their subordinates. They should not give undue favour to some and neglect others. They should not judge the performance and conduct of employees of the same category on a different basis.
12) Stability of Tenure
Fayol emphasised that employees should not be moved from their positions frequently. The duration of time an employee spends in a position should be established. It often requires a period to become familiar with a job. An employee can’t provide valuable service if they are moved before they become accustomed to their assigned tasks.
Employees at every level should have the freedom to take initiative in work-related matters. The initiative refers to the enthusiasm to proactively take action without needing to be prompted. However, it does not imply freedom to do whatever people like. They must observe discipline.
14) Esprit de Corps
It refers to the team spirit that is harmony in the workgroup and mutual understanding among workers. Managers must take steps to develop a sense of belonging among the members of a workgroup. When there’s a strong sense of team spirit, individuals step up to assist one another, fostering an environment of trust and mutual understanding.
Functions of Management by Fayol
Fayol’s 14 principles form a foundational framework for successful management. They offer leaders a complete guide to navigate the complexities of organizational dynamics and achieve optimal outcomes. These principles cover various management facets, such as planning, organising, directing, coordinating, and controlling.
Henri Fayol has identified five distinct managerial functions grouped according to their activities. These functions are:
Its chief manifestation and most effective instrument is the plan of action. Planning allows us to distinguish short-term events from long-term considerations.
According to Henri Fayol, “Planning is deciding the best alternatives among others to perform different managerial operations to achieve the pre-determined goals”.
To organise an industrial firm or a government agency is to provide it with everything required for its functioning, i.e., building the structure- raw materials, tools, capital, personnel, etc.
According to Henri Fayol, “To organise a business is to provide it with everything useful to its functioning, that is materials, tools, capitals and personnel”.
According to Fayol, command is maintaining activity among personnel, the art of command rests on certain personal qualities and knowledge of the general principles of management. Its degree of proficiency differs from unit to unit.
It consists of working together and harmonising’ all activities and efforts, to facilitate the working of the organisation. Essentially, the objective of coordination is to ensure that one department’s efforts are coincident with the efforts of other departments and keep all activities in perspective about the overall aims of the organisation.
According to Henri Fayol, “To coordinate is to harmonise all the activities of a concern to facilitate its working and its success. In a coordination enterprise, each department or division works in harmony with others and is fully informed of its role in the organisation. The working schedules of various departments are constantly tuned to circumstances”.
Its objective is to obtain conformity with the plan adopted, the instructions issued and the principles established. In the process, weaknesses and errors have to be rectified and their recurrence prevented. For control to be effective, it needs to be timely and backed by appropriate sanctions. In the French context, ‘control’ encompasses activities such as monitoring, auditing, and obtaining feedback.
According to Henri Fayol, “Control consists of verifying whether everything occurs in conformity with the plans adopted, the instructions issued and principles established, it has for its object to point-out weakness and errors to rectify them and prevent recurrences”.
Henri fayol 14 principles of management give us good ideas about being a good leader. They tell us that it’s important to talk, make sure everyone is working together, and treat people fairly. When managers follow these ideas, it helps make the workplace a happy and productive place for employees.
Fayol’s principles are like a toolbox that can be used in today’s business world. Even though they were made a long time ago, they are still useful in our fast and ever-changing work environment. When managers use these principles, they can solve problems, promote teamwork, and make the organization successful.
Fayol’s principles help managers get better at their jobs. When managers use these principles, they get better at making decisions, solving problems, and using resources wisely. This doesn’t just help the organization; it also helps managers become better at what they do.
Henri fayol 14 principles of management are like a handbook for good management. They are still important today and offer valuable advice for managers. When managers use these principles, they can handle the challenges of running an organization, create a happy workplace, and achieve long-lasting success.