Q2. What are the 14 principles of management of Henri Fayol?
Henri Fayol, a mining engineer and manager by profession, defined the nature and working patterns of the twentieth-century organization in his book, General and Industrial Management, published in 1916. In it, he laid down what he called 14 principles of management. This theory is also called the Administrative Theory. The principles of the theory are:
1. Division of work: tasks should be divided up with employees specializing in a limited set of tasks so that expertise is developed and productivity increased.
2. Authority and responsibility: authority is the right to give orders and entails enforcing them with rewards and penalties; authority should be matched with corresponding responsibility.
3. Discipline: this is essential for the smooth running of business and is dependent on good leadership, clear and fair arguments, and the judicious application of penalties.
4. Unity of command: for any action whatsoever, an employee should receive orders from one superior only; otherwise authority, discipline, order, and stability are threatened.
5. Unity of direction: a group of activities concerned with a single objective should be co-coordinated by a single plan under one head.
6. Subordination of individual interest to general interest: individual or group goals must not be allowed to override those of the business.
7. Remuneration of personnel: this may be achieved by various methods but it should be fair, encourage effort, and not lead to overpayment.
8. Centralization: the extent to which orders should be issued only from the top of the organization is a problem which should take into account its characteristics, such as size and the capabilities of the personnel.
9. Scalar chain (line of authority): communications should normally flow up and down the line of authority running from the top to the bottom of the organization, but sideways communication between those of equivalent rank in different departments can be desirable so long as superiors are kept informed.
10. Order: both materials and personnel must always be in their proper place; people must be suited to their posts so there must be careful organization of work and selection of personnel.
11. Equity: personnel must be treated with kindness and justice.
12. Stability of tenure of personnel: rapid turnover of personnel should be avoided because of the time required for the development of expertise.
13. Initiative: all employees should be encouraged to exercise initiative within limits imposed by the requirements of authority and discipline.
14. Esprit de corps: efforts must be made to promote harmony within the organization and prevent dissension and divisiveness.
The management functions, that Fayol stated, consisted of planning, organizing, commanding, co-coordinating and controlling. Many practicing managers, even today, list these functions as the core of their activities. Fayol was also one of the first people to characterize a commercial organization’s activities into its basic components. He suggested that organizations could be sub-divided into six main areas of activity:
1. Technical
2. Commercial
3. Financial
4. Security
5. Accounting
6. Management.
In defining the core principles governing how organizations worked and the contribution of management to that process, Fayol laid down a blueprint that has shaped organization thinking for almost a century.
