Henri Fayol's 14 Principles of Management Explained

Who Was Henri Fayol?

A French mining engineer, Henri Fayol is well-renowned as the 'Father of Modern Management Theory'. Fayol worked at the French mining company Commentry-Fourchambault and Decazeville, where he started as an engineer but worked his way up to become the general manager and then the organization's director from 1888 to 1918. When Foyal took on the managerial role at the mining company, he chose to rely not on his technical skills but on his ability as an organizer and his skills at handling people. 

Widely influential in the early 20th century, Henri Foyal wrote the book on management theories and work organization, "Administration Industrielle et Générale." Henri Foyal introduced theories that could be applied to all levels of management and for any department. Organizations and managers still practice Foyal's principles of management to ensure an efficient and successful business.

Henri Foyal developed the 14 principles of management towards the tail end of the industrial revolution. It was the perfect timing too, the world had been subjected to massive changes, and new and improved working styles were the need of the moment. Therefore, Fayol's Principles of Management influence the present management theory quite significantly.

Henry Fayol’s 14 Principles of Management

Henry Fayol’s 14 principles of management look at an organization from a top-down approach to help managers get the best from employees and run the business with ease. Let’s take a look at them and understand them in detail.

1. Division of Work

The first Henry Fayol principle of management is based on the theory that if an employee is given a specific task to do, they will become more efficient and skilled in it. This is opposed to a multi-tasking culture where an employee is given so many tasks to do at once. In order to implement this principle effectively, look at the current skill sets of each employee and assign them a task that they can become proficient at. This will help them to become more productive, skilled, and efficient in the long run.

Example: At a school, every department has a different responsibility, like academics, sports, administration, sanitation, food, beverages, etc. These responsibilities are taken care of by employees specializing in that particular department, increasing efficiency and productivity and making them specialists in their field.

2. Authority

This henry fayol principle of management states that a manager needs to have the necessary authority in order to ensure that his instructions are carried out by the employees. If managers did not have any authority, then they would lack the ability to get any work done. However, this authority should come along with responsibility. According to Henri Fayol, there should be a balance between authority and responsibility. If there is more authority than responsibility, the employees will get frustrated. If there is more responsibility than authority, the manager will feel frustrated.

Example: If an employee has been responsible for managing the decor department while planning an event but has no authority to make design decisions or contact the vendors to get the work done, no efficiency or productivity will be achieved.

3. Discipline

This principle states that discipline is required for any organization to run effectively. In order to have disciplined employees, managers need to build a culture of mutual respect. There should be a set of organizational rules, philosophies, and structures in place that should be met by everyone. Bending rules or slacking should not be allowed in any organization. In order to achieve this, there is a need for good supervision and impartial judgment.

Example: Every employee must follow certain rules and regulations and keep a disciplined attitude in the workplace for smooth working and efficient results.

4. Unity of Command

This principle states that that should be a clear chain of command in the organization. The employees should be clear on whose instructions to follow. According to Fayol, an employee should receive orders from only one manager. If an employee works under two or more managers, then authority, discipline, and stability are threatened. Moreover, this will cause a breakdown in management structure and cause employees to burn out.

Example: If in a company, an employee has been given a task to finish within 3 to 4 hours as ordered by their immediate superior. But the head of the department asks them to deliver the task within 1 hour. In this case, no unity of command can create confusion and pressure in the workplace.

5. Unity of Direction

This henry fayol principle of management states that the work to be done should be organized in such a way that employees work in harmony towards the same objective, using one plan, under the direction of one manager. For example, if you have a range of marketing activities such as advertising, budgeting, sales promotion, etc., there should be one manager using one plan for all the marketing activities. The different activities can be broken down for different sub-managers, but they should all work towards a common goal under the direction of one main person in charge of the whole thing. 

Example: Different sets of activities within a department should be managed by different managers to avoid confusion and lesser efficiency within the workflow.

6. Collective Interest Over Individual Interest

This principle states that the overall interest of the team should take precedence over personal ones. The interest of the organization should not be sabotaged by the interest of an individual. If anyone goes rogue, the organization will collapse. 

Example: While planning a team outing, the employee making the travel and stay decisions must make arrangements according to comfort and affordability, not just as per their liking.

7. Remuneration

This henry fayol principle of management states that employees should be paid fair wages for the work that they carry out. Any organization that underpays its workers will struggle to motivate and keep quality workers. This remuneration should include both financial and non-financial incentives. Also, there should be a structure in place to reward good performance to motivate employees.

Example: Any organization must be fair regarding their remuneration policies where all the employees must receive a salary worth their efforts irrespective of their gender, tenure, and other factors.

8. Centralization

Centralization refers to the concentration of power in the hands of the authority and following a top-bottom approach to management. In decentralization, this authority is distributed to all levels of management. In a modern context, no organization can be completely centralized or decentralized. Complete centralization means that people at the bottom have no authority over their responsibilities. Similarly, complete decentralization means that there will be no superior authority to control the organization. To use this effectively today, there should be a balance of centralization and decentralization. The degree to which this balance is achieved will differ from organization to organization.

Example: Centralization is mostly common in small and medium-sized firms where the delegation of work is minimal, and the owners make most of the decisions.

9. Scalar Chain

A scalar chain refers to a clear chain of communication between employees and their superiors. Employees should know where they stand in the hierarchy of the organization and who to go to in a chain of command. To implement this in the workplace, Fayol suggests that there should be an organizational chart drawn out for employees to see this structure clearly.

Example: Every organization has a specific chain of authority from the highest level of superiors, like the founder or CEO, to the lowest level of subordinates following a hierarchy for maximum productivity.

10. Order

This principle states that there should be an orderly placement of resources (manpower, money, materials, etc.) in the right place at the right time. This ensures the proper use of resources in a structured fashion. Misplacement of any of these resources will lead to misuse and disorder in the organization. 

Example: Employees should be given a designated space and the right tools or equipment to complete their work efficiently.

11. Equity

Equity is a combination of kindness and justice. This principle states that managers should use kindliness and justice towards everyone they manage. This creates loyalty and devotion among the employees towards the organization they work for.

Example: All employees, irrespective of gender, religion, race, and sexuality, must feel safe, seen, and heard and be given equal opportunities to grow and flourish in their careers within the organization.

12. Stability of Tenure of Personnel

This principle states that an organization should work to minimize staff turnover and maximize efficiency. Any new employee cannot be expected to get used to the culture of an organization right away. They need to be given enough time to settle into their jobs to become efficient. Both old and new employees should also be ensured job security because instability can lead to inefficiency. There should also be a clear and effective method to handle vacancies when they arise because it takes time and expense to train new ones.

Example: Every new employee must be given a proper induction of both the technical aspect of the company as well as the work culture and office environment for them to mingle well. Old employees should be given alum awards for completing certain tenures to boost morale.

13. Initiative

This principle states that all employees should be encouraged to show initiative. When employees have a say as to how best they can do their job, they feel motivated and respected. Organizations should listen to the concerns of their employees and encourage them to develop and carry out plans for improvement.

Example: Taking suggestions from employees regarding their specific department can make them feel seen in an authoritative position and can give them a sense of achieving something for the team.

14. Esprit de Corps

Esprit de Corps means “Team Spirit”. This henry fayol principle of management states that the management should strive to create unity, morale, and co-operation among the employees. Team spirit is a great source of strength in the organization. Happy and motivated employees are more likely to be productive and efficient. 

Example: While discussing the new plan of action for achieving the next month's targets, using the word 'We' instead of 'I' brings a teamwork spirit to the group.

That was all about principles of management.

History of the 14 Principles of Management

Henry Fayol is known as the father of modern management theory. He was an engineer at the Compagnie de Commentry-Fourchambault-Decazeville mining company and worked his way up to become a manager during the peak of the Industrial Revolution in France. Under his watch, the struggling company prospered.

In 1916, he wrote the book, "Administration Industrielle et Générale," where he shared his experiences of managing a workforce. This laid the foundation for administrative theory and the 14 Principles of Management. By focusing on administrative over technical skills, these principles became one of the earliest examples of treating management as a true profession.

What Is the Importance of the 14 Principles of Management?

Every organization is truly successful once its employee strength has been optimized to its full potential. These 14 principles of management by Henri Foyal are still widely influential in making sound management decisions and bringing the best results for both the company as well as the employees.

Foyal's principles of management are widely credited for making the employees highly efficient and productive, in turn generating the best possible results and effortless functioning of the organization. Below are some of the most important achievements organizations have achieved by following the 14 principles of management by Henri Fayol.

1. Structure

Every company requires a structure and a flow to prosper truly. These principles of management provide a structure to the management and encourage the authoritative personnel to take charge and bring out efficiency among the employees.

2. Communication

Communication is key in every well-managed company. Effective communication is the key to achieving maximum productivity while having clarity about the end goal. Clear and effective communication is a crucial tool in managing many employees and teams and ensuring the best results.

3. Efficiency

Fayol's principles of management give a firm perspective of how important it is to have good management in place to achieve maximum efficiency while doing smart work.

4. Loyalty

Any organization is nothing without its employees. It is very important to gain the employees' trust and loyalty as they are an important cog in running the company smoothly and efficiently. Ensuring these principles of management are observed and practiced can be a huge step in gaining trust and building healthy relations with the employees.

Criticism of Fayol's Principles of Management

While Henri Fayol's 14 principles of management are still significantly used by companies and organizations, there are certain criticisms around the theory. 

Fayol's school of thought, or Fayolism, is considered too rigid and can only be applicable in a formal structure. While this theory is practical in some aspects, it is argued that it is not completely useful as the employees should also be given the freedom to make decisions.

Are These Principles of Management Still Relevant Today?

Henry Fayol’s 14 principles of management are universally accepted and continually used as a guideline for managers across the world. Though these principles of management are more than 100 years old, without them, it would push us back hundreds of years back when technical skills reigned supreme, and people lacked managerial responsibility.

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FAQs

Q1. What is Fayol's theory of management?

Henri Fayol was known as the father of modern management. He gave us the famous 14 principles of management. According to him, the 5 main functions of management are Planning, Organizing, Commanding, Coordinating and Controlling. 

Q2. What are the principles of management?

Principles of management are basic activities that can help you plan, organize and control operations related to material, people, machines, methods, money and markets. They provide leadership to human efforts so that they achieve set objectives efficiently. 

Q3. Why is Henry Fayol called the father of management?

Henry Fayol is popularly known as the father of modern management as he suggested the 14 principles of management in the 20th century. His research and findings helped several enterprises scale their production and work in an efficient manner. He concentrated on the essential parts of a manager’s work in ensuring the production cycle. 

Q4. What Is the First Rule of Management?

The first rule of management is proper segregation or division of work among employees with respective strengths to fulfill those responsibilities. 

Q5. What are the characteristics of principles of management?

The basic yet important characteristics of the principles of management are planning, organizing, directing, staffing, and controlling. A manager or authority personnel must perform all these duties simultaneously.

Q6. What is the nature of the principles of management?

A principle is a universal concept for making well-informed and effective decisions and executing them efficiently. The principles of management are, by nature, a set of rules that, if followed, will help the company with great management.

Q7. What are the benefits of applying Fayol's principles of management?

There are many benefits to applying Fayol's principles of management, including:

• Increased efficiency and productivity
• Improved decision-making
• Reduced costs
• Increased employee morale
• Improved customer satisfaction
• Enhanced organizational performance

Q8. How can I apply Fayol's principles of management in my own organization?

• Start by identifying the principles that are most relevant to your organization
• Develop a plan for implementing the principles
• Communicate the principles to employees and managers
• Monitor the implementation of the principles and make adjustments as needed

Q9. What are the types of planning?

The 4 types of planning are strategic, operational, tactical, and contingency planning. 

Q10.What are the techniques of management by Henri Fayol?

Henri Fayol's techniques of management, known as the "14 Principles of Management," include division of work, authority, discipline, unity of command, unity of direction, subordination of individual interest to the general interest, remuneration, centralization, scalar chain, order, equity, stability of tenure of personnel, initiative, and esprit de corps.