Henri Fayol’s Principles of Management:

Fayol’s Fourteen Principles of Management are as follows:

1. Division of Work
2. Authority and Responsibility
3. Discipline
4. Unity of Command
5. Unity of Direction
6. Subordination of Individual Interest to General Interest
7. Remuneration of Personnel
8. Centralization
9. Scalar Chain (line of authority with peer-level communication)
10. Order
11. Equity
12. Stability of Tenure of Personnel
13. Initiative
14. Esprit de Corps

Fayol’s influence upon Gulick is readily apparent in the five elements of management discussed in his book:

Planning– examining the future and drawing up plans, which are s of actions

Organizing– building up the structure (labour and material) of the undertaking

Command– maintaining activity among the personnel

Co-ordination– unifying and harmonizing activities and efforts

Control– seeing that everything occurs in conformity with policies and practices

In his 1987 piece “Deja Vu: French Antecedents of American Public Administration,” Daniel Martin notes that virtually all of the principles in American Public Administration up to 1937 and the coining of the POSDCORB acronym, including the POSDCORB principles, were present in the French literature on the subject by 1859, but that the theorists of that era had largely forgotten this literature, thus the “re-invention” of these principles in the later French and American literature.

Classical administrative thinkers focused on the structural aspect of organisation. They believed that the setting up of a proper organisation required the observance of certain administrative principles. Therefore, classical writers such as Henry Fayol and Luther Gulick developed and discussed comprehensively the -so-called administrative principles of division of work, coordination, departmentalization, hierarchy, authority, unity of command, span of control, delegation, centralization and decentralization, and so on.

These writers thought that these principles could guide administrators not only in the creation of effective organisation but also in enhancing the academic status of Public Administration. In their opinion, these principles are universal in nature and applicable to diverse organisations in both public and private sectors.

Organisation is also related to management. Management is concerned with getting things done through other people in an organizational setting. It is the direction of a group‘s efforts toward achieving specified goals. Management is regarded as the collective utilization of human and material resources to achieve the defined goals of the organisation. While organisation provides the structure for the conduct of the work of an agency, management provides leadership, planning, direction, supervision and control. The efficient execution of the government‘s policies and programmes depends upon effective management and utilization of material and human resources.

Organisation is a method of dividing work among different people. Aristotle has suggested two ways of dividing work: First, division of work according to men or class of men and Second, division of work according to the service. In 1968 Halden Committee said, -Upon what principles are the functions of departments to be determined and allocated?

There appear to be only two alternatives, which may briefly be described as distribution according to process or classes to be dealt with and distribution according to the services to be performed.

The principle of division of work is basic for an organisation’s proper and efficient functioning. The importance of this principle of division of labour is clearly brought out by Kautilya in his Arthashastra when he says that the king alone cannot carry on the entire administration without assistance.

According to Henri Fayol, the division of work belongs to the natural order. Fayol compares organisations to huge animals. Animals evolved by specializing their biological structure, and the brain grew bigger. In the same way, the organisation develops by developing sound principles and methods. Fayol believes that organisations develop by refining their division of work, and the central staff gets bigger.

POSDCORB:

POSDCORB is an acronym widely used in the field of Management and Public Administration that reflects the classic view of administrative management. Largely drawn from the work of French industrialist Henri Fayol, it first appeared in a 1937 staff paper by Luther Gulick and Lyndall Urwick written for the Brownlow Committee.

The acronym stands for steps in the administrative process: Planning, Organizing, Staffing, Directing, Coordinating, Reporting and Budgeting. Gulick’s “Notes on the Theory of Organization” further defines the principles of POSDCORB by explaining that if an executive’s workload becomes too overwhelming, some of the elements of POSDCORB can be organized as subdivisions of the executive, depending on the size and complexity of the enterprise.

Under organizing, Gulick emphasized the division and specialization of labour in a manner that will increase efficiency. Gulick notes that there are three limitations to the division of labour.

The first occurs when labour is divided to the point where any task in the division of labour would require less than the full time of a worker, in which case a worker may need to be employed in other tasks to fill their time.

The second limitation to the division of labour arises from technology and custom, where certain tasks may only be handled by certain workers either because of a lack of technological means or customs at the time. Gulick gives the example of a single worksite in which only plumbers do the plumbing work and electricians do the electrical work, though this may not take up their full work time. Work in these areas could be re-combined in a manner to increase efficiency. However, union considerations could prevent this.

The third limitation to the division of labour is that it must not pass beyond physical division into organic division, or intricately related activities must not be separated from each other. Gulick gives the example that while it may seem more efficient to have the front end of a cow grazing in the pasture at all times and the back half being milked at all times, this would not work due to the intricate connection between the halves that are needed for the whole to function.

Principles of Management described by Henri Fayol:

Division of Labor:

1. Henry Fayol has stressed the specialization of jobs.
2. He recommended that work of all kinds must be divided & subdivided and allotted to various persons according to their expertise in a particular area.
3. Subdivision of work makes it simpler and results in efficiency.
4. It also helps the individual in acquiring speed and accuracy in his performance.
5. Specialization leads to efficiency & economy in spheres of business.

Party of Authority & Responsibility:

1. Authority & responsibility are co-existing.
2. If authority is given to a person, he should also be made responsible.
3. In the same way, if anyone is made responsible for any job, he should also have concerned authority.
4. Authority refers to the right of superiors to get exactness from their subordinates, whereas responsibility means an obligation for the performance of the job assigned.
5. There should be a balance between the two, i.e. they must go hand in hand.
6. Authority without responsibility leads to irresponsible behaviour, whereas responsibility without authority makes the person ineffective.

Principle of One Boss:

1. A subordinate should receive orders and be accountable to one and only one boss at a time.
2. In other words, a sub-ordinate should not receive instructions from more than one person because-
   • It undermines authority
   • Weakens discipline
   • Divides loyalty
   • Creates confusion
   • Delays and chaos
   • Escaping responsibilities
   • Duplication of work
   • Overlapping of efforts
3. Therefore, dual sub-ordination should be avoided unless and until it is absolutely essential.
4. Unity of command gives the enterprise a disciplined, stable & orderly existence.
5. It creates a harmonious relationship between superiors and subordinates.

Unity of Direction:

1. Fayol advocates one head, one plan, which means there should be one plan for a group of activities with similar objectives.
2. Related activities should be grouped. There should be one plan of action for them, and they should be under the charge of a particular manager.
3. According to this principle, the efforts of all the organisation’s members should be directed towards a common goal.
4. Without unity of direction, unity of action cannot be achieved.
5. In fact, unity of command is not possible without unity of direction.

Unity of Command:

The concept of unity of command is essential to avoid confusion and manipulation in organisations. Duality or multiplicity of command keeps an employee under confusion and conflicting situations, for instance, ‘whom‘ to follow and ‘what‘ to follow. Further, a subordinate can also evade orders by playing off one superior against another, undermining the organisational purpose. Henry Fayol is the most important advocate of the principle of unity of command. He asserted that -should it be violated, authority is undermined, discipline is in jeopardy, order disturbed, and stability threatened.

Read Also: Difference Between Unity of Command and Unity of Direction

Read Also: Difference Between Unity of Command and Chain of Command

Equity:

1. Equity means a combination of fairness, kindness & justice.
2. The employees should be treated with kindness & equity if devotion is expected of them.
3. It implies that managers should be fair and impartial when dealing with subordinates.
4. They should give similar treatment to people of similar positions.
5. They should not discriminate concerning age, caste, sex, religion, relation etc.
6. Equity is essential to creating and maintaining cordial relations between managers and subordinates.
7. But equity does not mean a total absence of harshness.
8. Fayol thought that -at times, force and harshness might become necessary for equity.

Order:

1. This principle is concerned with the proper & systematic arrangement of things and people.
2. The arrangement of things is called material order, and the placement of people is called social order.
3. Material order- There should be a safe, appropriate and specific place for every article and every place to be effectively used for a specific activity and commodity.
4. Social order- Selection and appointment of the most suitable person for a suitable job. There should be a specific place for everyone, and everyone should have a particular place so that they can easily be contacted whenever the need arises.

Discipline:

1. According to Fayol, -Discipline means sincerity, obedience, respect for authority & observance of the rules and regulations of the enterprise.
2. This principle applies that subordinates should respect their superiors and obey their order.
3. It is an essential requisite for the smooth running of the enterprise.
4. Discipline is not only required on the path of subordinates but also the part of management.
5. Discipline can be enforced if-
   • There are good superiors at all levels.
   • There are clear & fair agreements with workers.
   • Sanctions (punishments) are judiciously applied.

Initiative:

1. Workers should be encouraged to take initiative in the work assigned to them.
2. It means eagerness to initiate actions without being asked to do so.
3. Fayol advised that management should provide opportunities to its employees to suggest ideas, experiences& new methodss of work.
4. It helps in developing an atmosphere of trust and understanding.
5. People enjoy working in the organization because it adds to their zeal and energy.
6. To suggest improvement in formulation & implementation of place.
7. They can be encouraged with the help of monetary & non-monetary incentives.

Fair Remuneration:

1. The quantum and method of remuneration to be paid to the workers should be fair, reasonable, satisfactory & rewarding of the efforts.
2. As far as possible, it should accord satisfaction to both the employer and the employees.
3. Wages should be determined based on the cost of living, work assigned, financial position of the business, wage rate prevailing, etc.
4. Logical & appropriate wage rates and payment methods reduce tension & differences between workers & management, creating harmonious relationships and pleasing work atmosphere.
5. Fayol also recommended the provision of other benefits such as free education, medical & residential facilities to workers.

Stability of Tenure:

1. Fayol emphasized that employees should not be moved frequently from one job position to another i.e. the period of service in a job should be fixed.
2. Therefore employees should be appointed after keeping in view principles of recruitment & selection but once they are appointed their services should be served.
3. According to Fayol -Time is required for an employee to get used to new work & succeed in doing it well, but if he is removed before that, he will not be able to render worthwhile services.
4. As a result, the time, effort and money spent on training the worker will go waste.
5. Stability of job creates team spirit and a sense of belongingness among workers which ultimately increase the quality as well as quantity of work.
6. Fayol defines scalar chain as ‘The chain of superiors ranging from the ultimate authority to the lowest.
7. Every orders, instructions, messages, requests, explanation etc. has to pass through Scalar chain.
8. But, for the sake of convenience & urgency, this path can be cut shirt and this short cut is known as Gang Plank.

Sub-Ordination of Individual Interest to General Interest:

1. An organization is much bigger than the individual it constitutes therefore interest of the undertaking should prevail in all circumstances.
2. As far as possible, reconciliation should be achieved between individual and group interests.
3. But in case of conflict, individual must sacrifice for bigger interests.
4. In order to achieve this attitude, it is essential that-
   • Employees should be honest & sincere.
   • Proper & regular supervision of work.
   • Reconciliation of mutual differences and clashes by mutual agreement. For example, for change of location of plant, for change of profit sharing ratio, etc.

E-spirit De’ Corps (can be achieved through Unity of Command):

1. It refers to team spirit, i.e. harmony in the workgroups and mutual understanding among the members.
2. Spirit De‘ Corps inspires workers to work harder.
3. Fayol cautioned the managers against dividing the employees into competing groups because it might damage the moral of the workers and interest of the undertaking in the long run.
4. To inculcate Espirit De‘ Corps, the following steps should be undertaken-
   • There should be proper coordination of work at all levels
   • Subordinates  should  be  encouraged  to  develop  informal  relations  among themselves.
   • Efforts should be made to create enthusiasm and keenness among subordinates so that they can work to the maximum ability.
   • Efficient employees should be rewarded and those who are not up to the mark should be given a chance to improve their performance.
   • Subordinates should be made conscious of that whatever they are doing is of great importance to the business & society.
5. He also cautioned against the more use of British communication to the subordinates i.e. face to face communication should be developed. The managers should infuse team spirit & belongingness. There should be no place for misunderstanding. People then enjoy working in the organization & offer their best towards the organization.

Centralization & De-Centralization:

1. Centralization means the concentration of authority at the top level. In other words, centralization is when top management retains most of the decision-making authority.
2. Decentralization means disposal of decision making authority to all the levels of the organization. In other words, sharing authority downwards is decentralization.
3. According to Fayol, the degree of centralization or decentralization depends on no. of factors like the size of the business, experience of superiors, dependability & ability of subordinates, etc.
4. Anything which increases the role of subordinate is decentralization & anything which decreases it is centralization.
5. Fayol suggested that absolute centralization or decentralization is not feasible. An organization should strive to achieve a lot between the two.