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Management refers to the act of achieving goals through people. Some scholars are of the opinion that management refers to the process of planning, organising, coordinating and controlling to achieve the predetermined goals and Objectives.
Various authors have developed management theories, and Henry Fayol is one of the renowned theorists. Henry Fayol was born in 1841 in Istanbul, and he is one of the pioneers who developed theories of management during industrialization period.
According to Fayol, management refers to forecasting, planning, organising, commanding and controlling (Brunsson, 2008). He introduced fundamental basis of understanding management. Through his management theory, other philosophers have developed their theories in relations to management.
Hence, he is referred to as the father of the classical school of management (Parker & Ritson, 2005). This study focuses on Henry Fayol’s theory of management, its evolution and application in management of the organisations today.
Henry Fayol and the 14 principles of management
Henry Fayol joined coal mining factory as a chief executive officer after graduating with an engineering degree. He recognised that, for managers to be efficient and effective, they must apply some principals of management when managing their business entities (Brunsson, 2008).
Therefore, he developed the fourteen principles of management that help managers in managing their organisations. However, he disagreed with the notion that management requires an individual to possess some management traits.
Fayol emphasized on application of the fourteen principles of management. He argued that, management is not static, but rather it is a continuous process which keeps on evolving. Therefore, for managers to be efficient and effective, they must continuously improve their principles of management (Parker and Ritson, 2005).
Fayol authored a book called the General and Industrial Management. In this book, he explained the functions of management as; planning, organising, staffing, commanding, coordinating and controlling. The book divided General and Industrial Management into six groups namely: Technical undertaking, which involve production, manufacturing and adaptation.
Commercial undertaking, which focuses on exchanging, buying and selling of products. Financial undertaking, which focuses on optimum utilization of capital when carrying out organisation operations. Security undertaking, which dealt with personal and property protection. Accounting activities, which focus on taking the stocks of the company as well as maintaining the books of accounts.
Lastly, he divided the activities into managerial activities, which focus on planning, organising, commanding, coordinating and controlling activities (McLean, 2011). Fayol argued that, apart from employing the fourteen principals of management, decision makers should incorporate the activities for effective management of an organisation.
Henry Fayol formed the basis of management by providing the managers with a conceptual framework through his fourteen principles of management (Pryor and Taneja 2010). The first principles provide that division of labour is essential in an organization.
Fayol argued that, task should be apportioned among employees based on employees’ ability. For example, the management of Volkswagen Company, based in Germany, applies division of labour to manufacture quality products.
Workers are allocated tasks to manufacture vehicles based on their expertise. The second principle is the principal of authority and responsibility. This means that, managers have the right to give orders to employees and to expect obedience from their junior employees. On the other hand, employees have the obligation to execute the allocated tasks.
This principle is applied in Barrick’s Mining Company, based in the US. The third principle is the principle of discipline, which emphasizes that all the stakeholders should respect the rules and regulations in an organisation to ensure that order and efficiency prevails (Wren, 2001). The principle is commonly applied in Cadillac car manufacturing at General Motors Company, based in Detroit Michigan.
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The fifth principal involves unity of command, whereby, employees should receive commands from only one superior. The principle is exercised in Barrick’s Mining Company because it helps managers to avoid conflict within the organization, especially when giving commands to the junior employees (Sahni and Vayunandan, 2010).
The fifth principal that Fayol established was the principle of unity direction. The principle emphasizes on the importance of grouping similar activities together, especially the activities which are directed to a single manager.
For example, this principle helps Volkswagen Company to ensure that, all activities are executed effectively without having any activity not executed.
Fayol provided the sixth principle states that, there should be subordination of individual interest to general interest. This means that, the interest of an organisation should be given the first priority while the interest of individuals should come later.
The principle is commonly applied in Barrick’s company based in U.S., and has enhanced productivity of this company. The seventh principle provides that, employee’s remuneration should be fair.
This is because any perceived inequity among the employees might make the employees feel demotivated. Low motivation among employees can lead to reduction in the level of productivity. The eighth principal emphasizes on centralization.
Managers are referred to as the focal points were the authority originates, while employees are referred to be the ones to execute the allocated task (Sapru, 2006). This principle helps managers at Honda Company, based in Manito Tokyo Japan, to ensure there are seamless operations in production of Honda products.
The ninth principle emphasizes that there should be a scalar chain in an organisation. This indicates that the chain of command flows from the top to bottom. The top management should give commands, which should flow from top management to lower levels of management. The principle is normally applied in Forbes Company, based in U.S. The company has developed to dominate the global market.
The tenth principle explains that, there should be order in an organisation. Employees, managers, decision makers and all the stakeholders should observe certain rules and regulations. For instance, all stakeholders should be punctual when executing the activities of an organization.
This is crucial to ensure that time is not wasted, and that, all the stakeholders execute tasks promptly (Dzimbiri, 2009). The principle is commonly applied by Chinese construction companies, such as Civil Crafts Structure. The employees of Civil Crafts Structure Company are extremely conscious about time.
The eleventh principle indicates that there should be equity. Managers should ensure that all employees are treated fairly and with a lot of dignity without favouring either side (Sapru, 2006). This principle is commonly applied in Volkswagen Company. All the employees of the company are treated fairly to ensure that no discrimination is experienced.
Fayol’s twelfth principle is focused on personnel stability of tenure. According to this principle, managers should promote a stable workforce by encouraging employees’ long-term dedication and commitment.
Organizations applying this principle experience reduction in the rate of employee turnover. This ensures that, there is increased organisational productivity and profitability, as well (Dzimbiri, 2009). The thirteenth principle show that, employees are supposed to develop with new ways of doing things. This principle is very important in the modern market environment.
Organizations should apply innovative products to achieve a competitive edge in the modern market environment. For example, the Apple Company has achieved a competitive advantage because it develops innovative products. The company is renowned for developing products such as iPad, iPod and others. The fourteenth principle emphasizes on Esprit de Corps.
This means that, managers should embrace and promote unity within an organisation by encouraging team work among the employees and all other stakeholders. The principle has promoted cohesiveness among Chinese Engineers in Civil Structure Company.
The principle formed a fundamental basis for management practice during the industrialization period. However, the principle is not widely applied by managers today, but it still remains relevant (Dzimbiri, 2009).
Henry Fayol emphasized that managers should possess the six the primary qualities of effective management to conduct management functions effectively. He argued that, for managers to apply the six concepts of management, they should define what they intend to achieve within a predetermined time frame.
Managers should also create the authority lines through which there is efficient flow of commands. The commands should be issued such that the entire organisation is set towards execution of activities (Sahni and Vayunandan 2010).
Henry Fayol’s classical theory of management has also proved to have a wide range of applications and advantages in organizations today. This is because; his fourteen principals of management are still applied to manage enterprises. The principle of division of labour helps human resource managers to allocate tasks to the employees.
This ensures that work is evenly distributed among workers, and helps to ensure that the effort of each worker is being utilised productively (McLean, 2011). The principle of equity helps managers to treat employees with fairness. Equal treatment causes employees to feel valued and recognised.
This leads to increase in the productivity of employees. The principle of initiative enables managers to encourage employees to be creative and innovative. Employee’s creativity and innovativeness enable the organisation to cope with the dynamics that may be experienced in an organisation.
This enables an organisation to have a continuous performance improvement (Wren, 2001). The Principle of Esprit de Corps enhances unity and team work within the organisation. Unity and team work promotes corporation among the employees, and this leads to increased organisation productivity.
The principle of stability of tenure enables employees to feel that their contributions are being appreciated. They feel dedicated towards achieving organisation goals and objectives. Additionally, the principle promotes the stability of the workforce by ensuring that there is long term employees’ commitment and dedication towards attaining the anticipated outcomes.
Fayol’s principle of unity of direction helps to prevent confusion and conflict within an organisation. According to this principle, employees are supposed to receive commands from only one superior. Hence, multiple commands to a single worker are avoided (Dzimbiri, 2009).
However, despite having many advantages, the theory is faced by some limitations. The theory is being criticized for neglecting the needs of workers by failing to account their plights. Therefore, the theory is said to be management oriented rather than employees oriented (Dzimbiri, 2009).
This means that, the theory emphasizes towards increasing the productivity of the organisation without considering the needs of the workers. The theory has the disadvantage of failure to embrace the fundamental managerial aspect such as; promoting vertical and horizontal communication (Sapru, 2006).
Fayol’s theory of the classical school of management was based on military context and not in a business context. Therefore, the theory emphasizes on commanding employees rather than directing them (Cole, 2004). Additionally, the theory has the disadvantage of failure to encourage informal groups and informal communication.
Lack of informal groups within the organisation denies employees a vital tool which they can express their grievances to the top management (Sahni and Vayunandan, 2010). The theories further tend to describe Henry Fayol’s vision rather than the actual reality. This is because it lacks substantial facts and evidences to support its assertions.
This means that the theory has not been substantiated by empirical research evidence but rather it is based on mare Fayol’s personal experience (Parker and Ritson, 2005). The theory is criticised for having some principles which may not be relevant in a business context.
This means that some of the Fayol’s fourteen principles of management have limited applications in the business environment today. For example, the principle of unity of command is suitable in Military contexts rather than in business management. This is because in a business context manager should lead rather than commanding (Dzimbiri, 2009).
Henry Fayol classical theory of management has a wide range of application in today’s business. This is because managers find some of Fayol’s principle management to be relevant when managing organisations.
Despite this theory being widely accepted, the theory is criticised because it is based on Henry Fayol’s personal experience during his tenure at coal mining factory. The theory has not been substantiated by any empirical evidence based on research.
Hence, its credibility is still questionable. Despite lacking substantial evidence to support this theory, the theory formed a fundamental basis upon which many theories were formed. The theory helps identify the best practice to manage organisations and achieve the predetermined goals and objectives.
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