Henri Fayol is regarded as the 'Father of Modern Management Theory', for he was the first to suggest the functions of management which are recognized as the essential part of a manager's work by the modern authorities on management.
Henri Fayol had given 14 Principle of Management which are universally accepted guidelines for managers to do their job according to their responsibility. These principles of Management are based on a fundamental truth. These principles of management serve as a guideline for decision-making and management actions. They are the observations and analyses of events that managers encounter in practice. Henri Fayol was able to state 14 principles after the study of years.
These principles are following -
1. Division of Work
The principle of 'Division of Work' means to divide work into small parts so that each part is handled with great ease and efficiency. It allows for the maximization of efficiency in the manufacturing process, as well as in other economic sectors. Division of work improves both efficiency and productivity.
2. Balancing Authority and Responsibility.
According to this principle, the amount of authority and responsibility must be balanced among superior and subordinates. Because extra authority may result in misuse of authority and less authority may result in improper functioning of management. The main purpose of this principle is to avoid misuse of authority and at the same time helps in the proper discharge of responsibility. Every subordinate has to perform the duty assigned to him. It arises from the superior-subordinate relationship. So, The Essence of authority is an obligation.
3. Discipline
Discipline means obedience, respect for authority and follows established rules of the organisation. A successful organization requires the common effort of workers. Penalties should be applied to indiscipline labour. Because Discipline is the source of power in any organisation.
4. Unity of Command.
According to this principle, everyone should have only superior, otherwise, conflicts and confusion can arise between superior and subordinate. Unity of command provides that an employee is controlled by only one supervisor, and respond to only one supervisor, and so on up the organizational hierarchy. This level of principle must be followed from the top of the organization to bottom.
5. Unity of Direction.
The principle states that there should be only one leader and one plan for a series of activities for the accomplishment of the same objective. It is a concept found in administrative management theory.
6. Subordination of Individual Interests to the General Interest.
According to this principle, the interest of the organization must have priority above the interests of the individual and the group. Everyone joins any organisation to earn name and fame with high earnings but organisation interest must prior over individual or group. It can be achieved only when managers in high positions in the organization set an example of honesty, integrity, fairness and justice.
7. Remuneration.
According to this Principle Many variables, such as cost of living, the supply of qualified personnel, general business conditions, and success of the business, should be considered in determining a worker’s rate of pay.
8. Centralization.
According to this Principle Core power related to main activities must be centralized which means main decision related to projects must be taken by directors of the company. While decision-related non-core activities or day to day activities must be decentralized which sub-ordinates must have authority to make decisions. It is very important in business because it helps to consume less time in decision making and also helps to improve the productivity of the organisation.
9. Scalar Chain.
The scalar chain is the formal chain of authority which start from top to bottom level of organisation. The is a route through which information related to core activities and non-core-activities travels in any organisation. According to this principle, a subordinate is liable up to his superior, not more than that. It a subordinate will follow all instruction given to him by his superior. So according to this principle, a formal chain of communication must followed from top to bottom and bottom level of management. It must not be broken in any situation. It must be continued in every situation.
10. Order.
According to this Principle, in every organisation, there should be a fixed place for every men and material. Because if men and material will be on fixed place then it will help in wastage of time by removing unwanted extra efforts. It will also facilitate smooth working and avoid wastage of resources. So Fayol, suggested that every men and material must be at a fixed place.
11. Equity.
According to this Principle, there must not be discrimination on the basis of race, gender, disability, religion or belief, sexual orientation and age in the organisation. So there must be equality in the organisation. And if someone does so then there must be a list of penalties for such person the organisation.
12. Stability of Tenure of Personnel.
This principle states that employees turnover must be minimized because it requires lots of time and resources to select the employees. So each and every employee must be selected after a rigorous process. They must be given the sufficient time to show their results. Employee stability can enable the more productivity without wastage of time and money in the organisation.
13. Initiative
According to this principles, every superior must encourage his subordinates to take initiative for their work in the form of new ideas, thoughts or any related for the betterment of the organisation. Subordinates must have authority to explain their opinion in front of everyone. They should be rewarded for good ideas and thoughts. It can increase competition among the employees and also induce them to work hard. So it is important for subordinates to have in their functioning.
14. Esprit De Corps.
This principle states that there must be unity among all the workers and superiors. Every one must encourage the spirit of harmony so that everyone can put efforts with team efforts. It creates team spirit among the workers and subordinates. In any organisation, the word 'I' must change with 'WE'. Because It will help people to think as a team, not as an individual.
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