Universal Principles of Management by Henri Fayol

Fayol's career began as a mining engineer. He then moved into research geology and in 1888 joined, Comambault as Director. Comambault was in difficulty but Fayol turned the operation round. On retirement he published his work - a comprehensive theory of administration - described and classified administrative management roles and processes then became recognised and referenced by others in the growing discourse about management. He is frequently seen as a key, early contributor to a classical or administrative management school of thought.

His theorising about administration was built on personal observation and experience of what worked well in terms of organisation. His aspiration for an "administrative science" sought a consistent set of principles that all organizations must apply in order to run properly.

F. W. Taylor published "The Principles of Scientific Management" in the USA in 1911, and Fayol in 1916 examined the nature of management and administration on the basis of his French mining organisation experiences..

Both Fayol and Taylor were arguing that principles existed which all organisations - in order to operate and be administered efficiently - could implement. This type of assertion typifies a "one best way" approach to management thinking. Fayol's five functions are still relevant to discussion today about management roles and action.

1. To Forecast And Plan - Prevoyance

examine the future and draw up plans of action

2. To Organise

build up the structure, material and human of the undertaking

3. To Command

maintain activity among the personnel

4. To Co-Ordinate

bind together, unify and harmonise activity and effort

5. To Control

see that everything occurs in conformity with policy and practise

Fayol also synthesised 14 principles for organisational design and effective administration. It is worthwhile reflecting on these are comparing the conclusions to contemporary utterances by Peters, Kanter and Handy to name but three management gurus. Fayol's 14 principles are:

 Specialisation/Division Of Labour

This principle is the same as Adam Smith's 'division of labour'. Specialisation increases output by making employees more efficient.A principle of work allocation and specialisation in order to concentrate activities to enable specialisation of skills and understandings, more work focus and efficiency.

 Authority With Corresponding Responsibility

Managers must be able to give orders. Authority gives them this right. Note that responsibility arises wherever authority is exercised.

If responsibilities are allocated then the post holder needs the requisite authority to carry these out including the right to require others in the area of responsibility to undertake duties.

A manager should never be given authority without responsibility--and also should never be given responsibility without the associated authority to get the work done.

 Discipline

The generalisation about discipline is that discipline is essential for the smooth running of a business and without it - standards, consistency of action, adherence to rules and values - no enterprise could prosper.Employees must obey and respect the rules that govern the organisation. Good discipline is the result of effective leadership, a clear understanding between management and workers regarding the organisation's rules, and the judicious use of penalties for infractions of the rules.

 Unity Of Command

The idea is that an employee should receive instructions from one superior only. This generalisation still holds - even where we are involved with team and matrix structures which involve reporting to more than one boss - or being accountable to several clients. The basic concern is that tensions and dilemmas arise where we report to two or more bosses. One boss may want X, the other Y and the subordinate is caught between the devil and the deep blue sea.

 Unity Of Direction

Each group of organisational activities that have the same objective should be directed by one manager using one plan.The unity of command idea of having one head (chief executive) with agreed purposes and objectives and one plan for a group of activities is clear.

 Subordination Of Individual Interest To The General Interest

Fayol's line was that one employee's interests or those of one group should not prevail over the organisation as a whole. This would spark a lively debate about who decides that the interests of the organisation as a whole are. The interests of any one employee or group of employees should not take precedence over the interests of the organisation.

 Remuneration Of Staff
" The Price Of Services Rendered".

The general principle is that levels of compensation should be "fair" and as far as possible afford satisfaction both to the staff and the firm (in terms of its cost structures and desire for profitability/surplus).

 Centralisation

Centralisation refers to the degree to which subordinates are involved in decision making. Whether decision making is centralised (to management) or decentralised (to subordinates) is a question of proper proportion. The task is to find the optimum degree of centralisation for each situation.

 Scalar Chain/Line Of Authority

The scalar chain of command of reporting relationships from top executive to the ordinary shop operative or driver needs to be sensible, clear and understood.The line of authority from top management to the lowest ranks represents the scalar chain. Communications should follow this chain. However, if following the chain creates delays, cross-communications can be allowed if agreed to by all parties and superiors are kept informed.

 Order

People and materials should be in the right place at the right time.The level of generalisation becomes difficult with this principle. Basically an organisation "should" provide an orderly place for each individual member - who needs to see how their role fits into the organisation and be confident, able to predict the organisations behaviour towards them. Thus policies, rules, instructions and actions should be understandable and understood. Orderliness implies steady evolutionary movement rather than wild, anxiety provoking, unpredictable movement.

 Equity

Equity, fairness and a sense of justice "should"pervade the organisation - in principle and practice.Managers should be kind and fair to their subordinates.

 Stability Of Tenure

High employee turnover is inefficient. Management should provide orderly personnel planning and ensure that replacements are available to fill vacancies.Time is needed for the employee to adapt to his/her work and perform it effectively. Stability of tenure promotes loyalty to the organisation, its purposes and values.

 Initiative

Employees who are allowed to originate and carry out plans will exert high levels of effort.At all levels of the organisational structure, zeal, enthusiasm and energy are enabled by people having the scope for personal initiative.

 Esprit De Corps

Here Fayol emphasises the need for building and maintaining of harmony among the work force , team work and sound interpersonal relationships.Promoting team spirit will build harmony and unity within the organisation.