Henri Fayol's - 14 Principles of Management

Application of Unity of Command The reasons for application of this principle are:

+ Confusion on the part of a subordinate regarding whose orders he must obey is done away with. If there are more than one superior dictating terms to a subordinate, the latter would always be in a state of confusion. Avoidance of this confusion on the part of the subordinate is likely to lead him towards better and more efficient performance. + A single superior issuing orders and instructions to a subordinate can easily seek an explanation from the subordinate as to why the work was not done properly by him when proper authority and work facilities had been provided to him for that purpose.

Scope and extent of authority (Management level)

1. (Top Management )Board of directors - Chief Executive - Plan/Conceptualize 2. Middle Management - Interact/ human/ people skills 3. First-line supervisor / junior - Technical

Fayol's Management Rules and Actions:

1. Forecast and plan - Examining the future and drawing up a plan of action. 2. To organize - Build up the structure, both material and human of the undertaking. 3. To command - Maintain the activity among the personnel. 4. To coordinate - Binding together, unifying and harmonizing all activity and effort. 5. To control - Seeing that everything occurs in conformity with established rule and expressed command.

In Henri Fayol's view, the following factors are essential for establishment of discipline in an enterprise:

1. Good superiors are there at all levels in the organization, for, it is only when superiors are disciplined they can expect discipline from subordinates. 2. Agreements containing the rules of the organization are clear and fair as much as possible. 3. Penalties for non-observance of discipline are applied judiciously and impartially.

Demerits of Division of Work

1. Monotony 2. Kills the creative instinct 3. Loss of skill 4. Risk of unemployment 5. Check development of personality 6. Loss of responsibility 7. Evils of factory system 8. Problem of distribution 9. Check mobility 10. Dependence

Merits of Division of Work

1. The right man in the right place 2. The worker becomes an expert 3. Heavy work taken over by machinery 4. Less training required 5. Invention 6. Cheaper things 7. Economic in the use of tools 8. Saving in time

4. Unity of Command

• Unity of Command is perhaps one of the most useful and significant principles of management advised by Fayol. • According to this principle, a subordinate must get orders and instructions, only from one superiors at a time. • No employee should report to two or more people. • The employee may receive conflicting demands or priorities from several supervisors at once, placing this employee in a no-win situation.

4. Discipline ( Employee Discipline) + Discipline, in simple terms, means obedience to the roles of the organization on the part of both managers and subordinates. + Discipline is conducting the business in a systematic way by adhering to the rules of the organization. + A disciplined employee will be organized and an organized employee will always be disciplined. +Discipline ensures both productivity and efficiency in an organization.

+ Discipline improves the morale of the employees and encourages cooperation among the employees and management. + Discipline is necessary in an organization if the organization is to function properly and prosper and grow. + In short, discipline implies obedience, orderliness and maintenance of proper subordination among employees. + Without discipline, there will be chaos, confusion and disobedience in the organization.

3 sources of authority

+ Formal authority: It is official authority given to an individual by his boss. For example, shareholders delegate authority to the Board of Directors which in turn delegates to Chief Executive. + Competence authority: It is the authority of knowledge. A person having specialized knowledge and skill commands influence over others. + Acceptance authority: It is the authority which an individual gets when others accept or obey his orders and instructions. A person's command may be accepted when he can give rewards and penalties.

Types of penalties for indiscipline/misconduct

+ Major penalties- This includes demotion, dismissal, transfer, discharge, withholding increments, etc. + Minor penalties- This includes oral warning, written warning, fines, loss of privileges, etc.

Assumptions of good disciplinary system - Positive approach - knowledge of rules - Timely action - Fair and just action

+ The employees should be aware of the rules and regulations which are followed in the organization. These rules should be printed and circulated/communicated to the employees in their handbook. + If there is any violation of rules and regulation, timely action should be taken. If the punishment is delayed then the employees feel that punishment is not deserved. + Punishment should be same for similar offence or misconduct. There should not be any bias. Discipline should be uniformly enforced always. + The disciplinary system should be used to prevent misconduct and not just to impose penalties. The employees should be educated on how such penalties and punishments can be avoided in future.

Forms of Division of Work

+Division of labor: This means division into occupation. Thus, there are farmers, weavers, teachers, priests, laborers etc. +Technical division of labor: This refers to division of labor within a factory or industry. Within an industry, there will be several technicians like engineers, accountants, designers, managers etc. Technical division of labor is marked feature of modern machine age. +Territorial division of labor: This is also known as localization of industries. Certain places specialize in making of certain articles. Division of labor is based on the principle of co-operation or interdependence. The different persons among whom the work is divided co-operate in the production of a thing.

1. Division of Work

- Division of work is a famous principle of economics, invented by the traditional economist, Adam Smith. -Fayol had applied this principle in the context of business enterprise. Division of work leads to specialization which results in increased human efficiency. -Through the application of this principle the production can be increased with same amount of human effort.

Dimensions of discipline +Discipline is viewed from 2 angels/dimensions - Positive discipline: • Positive discipline implies disciplines without punishment. • It encourages self-discipline among the employees. • In this case, the employees consider group objective as their own objective and work hard to achieve them. • The employees follow the rules and regulations not because of the fear of punishment, but because of their desire to achieve the organizational goals.

- Negative discipline: • Employees follow the rules and regulations in fear of punishment. • Employees do not consider the organizational goals as their goals. • The penalties can be fines, transfers or demotions. • The fear of punishment prevents the employees from going off-track.

Characteristics of good disciplinary system: 1. IMMEDIATE: The penalty for violation should be immediate. Disciplinary action should be immediately taken for violation of rules. 2. CONSISTENT: There should be high consistency in a sound disciplinary system.

3. IMPERSONAL: Impersonality should be maintained by refraining from personal or subjective. 4. PRIOR WARNING AND NOTICE: A sound disciplinary system should give advance warning to the employees as to the implications of not conforming to the standards of behavior.

1. Henri Fayol was born in Istanbul in 1841. When he was 19, he began working as an engineer at a large mining company in France. He eventually became the director, at a time when the mining company employed more than 1,000 people. 2.Fayol began to develop what he considered to be the 14 most important principles of management. Essentially, these explained how managers should organize and interact with staff.

3.In 1916, two years before he stepped down as director, he published his "14 Principles of Management" in the book "Administration Industrielle et Generale" . 4. Fayol also created a list of the six primary functions of management, which go hand in hand with the Principles. 5. Fayol's "14 Principles" was one of the earliest theories of management to be created, and remains one of the most comprehensive.

Advantages of Unity of Command 1. Better relationship among superior and subordinates. 2. Clear and well-organized Authority,Responsibility and Accountability. 3. Reduces and/or avoids duplication of work. 4. Prompt or quick decision making.

5. Good, effective and efficient discipline. 6. Better coordination and team work. 7. Boosts morale and positive attitude of workers. 8. Leads to higher productivity of goods and services.

5. Unity of Direction

Direction is a management function performed by all managers at different levels of organization. Direction is concerned with the function of guiding and observing subordinates at work. It is the connecting link between the preparatory function of management and the function of controlling. Thus direction is not merely issuing orders and instruction by a superior to his subordinates, but it is also the process of guiding and inspiring them.

Henri Fayol was a French mining engineer, mining executive, author and director of mines who developed a general theory of business administration that is often called Fayolism. Born: July 29, 1841, Constantinople Died: November 19, 1925, Paris, France

Nationality: French Education: École nationale supérieure des mines de Saint-Étienne (1860) Books: Henri Fayol's Classic General and Industrial Management

Difference between authority and responsibility: Authority

Responsibility

Authority is the legal right of the superior to command his subordinates. Authority arises either from a formal contract or from legal provisions Authority can be delegated by a superior to his subordinates. Authority always flows downwards i.e., from a superior to his subordinates. Authority usually has a longer life than responsibility. Authority may be terminated by a notice.

Responsibility is the obligation of a subordinate to perform the duties assigned to him by his superior. On the other hand, responsibility arises from a superior-subordinate relationship. Responsibility is absolute and can never be delegated. The flow of responsibility is upwards. A subordinate is responsible for the acts of his superiors. Responsibility generally comes to an end after the assigned duty is performed. Responsibility cannot be terminated.

2. Authority

The term 'authority' implies the right and power of a person to exercise discretion to make decisions, to issue orders, to use organizational resources and to hire and fire employees. It is the sum of rights and powers entrusted to a person to enable him to perform the assigned tasks. "The right to give order and the power to exact obedience" - Henri Fayol

Example of Unity of Command

Unity command: Manager - Assistant Manager - Supervisor - Executive - Workers

Management principles

are a set of fundamental truths based on logic which provides guidelines for managerial decision making and other actions.

3. Responsible:

refers to the obligation to perform the given task to the best of one's ability. Responsibility is always in relation to human beings because non-living things cannot be assigned a duty. Responsibility is of a person and not a machine. It always flows upwards i.e., from a subordinate to a superior. Responsibility arises only when a duty has been assigned by a superior to a subordinate. Responsibility may be continuing obligation or confined to the performance of a single function.

Features of Management Principles

universal, aim at influencing human behavior, flexible, equal importance, have cause and effect relationship

These principles are derived:

• On the basis of observation and analysis i.e. practical experience of managers. • By conducting experimental studies