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Henri Fayol is believed to be the founder of contemporary management theory which is drawn from his extensive experience in the management field. In other words, he is acknowledged for his contribution in the field of management, having established a foundation for modern management theory.
Despite the fact that the Fayol management theories were developed in the 1900s, they continue to play an integral role in modern society. For instance, Pryor and Taneja (2010, p. 490) note that the 14 principles of management developed by Fayol are considered the basis for management as witnessed in modern organizations.
The purpose of the essay is to show that in spite of the criticisms levelled on Fayol’s management theories, they still form a foundation of management in modern society.
Modern organizations develop strategies, goals, and plans which act as guidance to an organization in achieving its objectives. This observation has been supported by Wren (2001, p.482) who note that Fayol acted as a strategist in making strategic decisions when he was head of management at Comambault.
In addition, he had set long term organizational goals which were: profitability, restoring confidence to shareholders, ensuring that the organization remained competitive, and maintaining the welfare of employees (Wren 2001, p.482). All these activities which are based on the administrative aspect of management theory as applied by Fayol are part of modern management where organizations plan, set goals, and strategize.
Furthermore, organizational managers act as representatives of shareholders, set goals and plan how to execute the goals. As a result, most organizations have adopted these three activities to ensure the welfare of different stakeholders is achieved.
Profit maximization and gaining a competitive advantage over competitors are also major drivers of modern organizations which are pioneered by organizational managers. Although these examples are drawn from the mining sector where Fayol was the managing director and CEO, the perspective is still applicable.
However, critics have been quick to note that Fayol used authoritarian form of leadership to execute his administrative abilities which may not be applicable in modern organizations (Brunson 2008, p.32).
Nevertheless, the author adds that if a manager is asked the kind of responsibilities that he/she is entitled, the ultimate response would be planning, organizing, controlling, and controlling.
Management in an organization leads to effectiveness and efficiency in the running of an organization. As noted by McLean (2011, p.32), as the managing director Fayol emphasised a lot on what management entails, how it could be executed and how it could be applied to achieve effectiveness and efficiency.
In addition, he concluded by noting that the role of management was forecasting, planning, organizing, commanding, coordinating and controlling. This led to the development of different roles of management in an organization in order to achieve success and financial breakthrough or survive economic and financial crises.
As regards the element of forecasting and planning, a manager should be in a position to forecast and undertake an analysis of the environment in which an organization operates (McLean 2011, p. 33).
These managerial activities have continued to be practiced in contemporary management especially in the global markets characterized by high levels of change, increased competition, and increase in demand from customers.
As noted by Pryor and Taneja (2010, p.491), Fayol gave organizations the managerial role of planning upon his engagement in managerial post.
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Planning and forecasting have since been adopted by organization in ensuring that they play an integral role in safeguarding the interests of different stakeholders.
He also held on the belief that it was the role of the management structure to organize different parts of an organization such as resources, organizational systems, infrastructure, services, processes, and procedures which ensures that an organization fully achieve its ultimate end goals.
Organizations are made of different players who have different skills such as managerial and technical skills. These two elements are part of the six activities which Fayol believed were crucial to organizational success. In this context, Pryor and Taneja (2010, p.491) keenly observe that Fayol emerged as the first theorist to make a distinction between managerial and technical skills.
The distinction made was that employees at various levels within an organization required technical skills. This is because such skills would assist in the completion of different tasks in organizational levels. He added that even employees in management levels required a bit of technical skills which would be applied in the management of the production process.
On the other hand, Fayol’s theory holds that managerial skills are important to employees who assume more responsibilities in managerial positions of an organization. The argument made here is that managerial skills are only necessary to employees who hold managerial positions while technical skills are important to all employees in an organization.
What emerges in this point is that despite the need for proficient skills to all employees, some skills are for all people in an organization while others are to be found in a particular group. This can be illustrated fully in the turnaround of Comambault where Fayol exhibited both his technical abilities as an engineer as well as a manager (Wren 2001, p. 484).
The advantage of having technical skills is that a manager is able to use his expertise combined with managerial capabilities to effectively and efficiently run an organization.
Fayol has been credited for his role in developing the 14 principles of management (Pryor and Taneja (2010, p.491). The 14 principles of management were designed solely with the objective of guiding a manager to undertake his/her daily managerial activities.
According to Parker and Ritson (2005, p.176), these principles have been designed in such a way as to assist managers in running successful organizations. One of the major principles applied in modern organizations is division of labour. Division of labour is used in reference to the distribution of work to different employees or groups so as to reduce the time taken by an individual or a group (Rodrigues 2001, p. 881).
Based on this explanation, division of labour encourages specialization which reduces efforts for a group or an individual. In addition, division of labour develops familiarity and better work practices. The success of this concept can be drawn from Fayol application where he divided workers into different groups depending on their skills and expertise.
This improved the overall performance and reduced the time taken in carrying out tasks. The argument can be supported by Pryor and Taneja (2010, p.491) who note that division of labour in organizations encourages specialization which increases speed and level of performance.
Speed and high level of performance improves efficiency in the workplace by encouraging employees to perform more efficiently thus saving time (Rodrigues 2001, p. 881).
In addition, employees are divided into small groups and the group elements are allocated job depending on their specialization and skills. The only limitation is that it leads to group identification which may have a negative effect.
Managers execute their obligation as custodians of the shareholders because of the responsibility and authority endowed in them. As noted by Pryor and Taneja (2010, p.491), Fayol acknowledged the need for managers to have authority over others and show responsibility so that an organization can achieve its organizational objectives.
The implication made is that for an organization to achieve its ultimate goals, managers have to exercise authority which comes with responsibility. Fayol gave the distinction between authority and responsibility and warned that authority should never be confused with responsibility.
As noted by Parker and Ritson (2005, p.176), authority is considered as the power of an individual to give orders to a group of people. In addition, authority is used to exact obedience in the workplace which creates harmony and a better working environment.
Responsibility arises from exercising of authority over others in the workplace. Whenever a manager exercises authority to employees, different parties play their part in an organization. Managers have the responsibility to ensure that an organization operates smoothly. This can be achieved by exercising
authority over subordinate members of the organization. McLean (2011, p.33) and Rodrigues (2001, p. 882) note that managers play the role or coordinating activities in the workplace which is carried through the exercise of authority and responsibility.
Some of the activities in modern management which require authority include harmonizing and unifying organizational efforts and activities. Despite the many benefits of the concepts of responsibility and authority, there are also disadvantages such as the abuse of authority and power by managers.
In order for employees to execute their roles without any hindrance such as strikes and stoppages, remuneration is deemed important. Remuneration emerges as one of Fayol’s management principles, and according to Parker and Ritson (2005, p.176), the management of an organization should offer a fair remuneration to its employees.
In addition, Fayol has described remuneration as the price an organization pays for the services rendered by its employees. In the modern organization, remuneration is paid in the form of salaries and wages. Furthermore, employees in any organization are paid based on performance or their level of value to such an organization.
Fayol goes to the extent of explaining that there are different types of numeration which organizations offer to its employees (Pryor & Taneja 2010, p. 492; Rodrigues 2001, p. 883). The different types of numeration as stated by Fayol include non-financial and financial incentives, profit sharing, piece rates, job and time.
All these different forms of compensation play an integral role in an organization such as boosting employee’s morale and motivating employees to increase their performance levels. Compensation should be fairly carried in an organization to ensure that all employees are satisfied.
Subsequently, harmony and understanding is achieved in the workplace which increases the level of production. Wren, Bedeian and Breeze (2002, p. 913) observe that remuneration is used to stimulate individual employee initiative which plays an integral role in innovation and creativity.
Therefore, the principle of remuneration is often applied by managers to carry out different tasks which may include other aspects such as personal satisfaction, self respect, and self interest.
A manager is charged with the responsibility of ensuring discipline, unity of action, and order in an organization. The observation is supported by Wren et al. (2002, p.911) and Rodrigues (2001, p. 881) observations that different departments have different functionalities which work harmoniously under the leadership of a manager.
In other words, managers play an administrative role as showcased by Fayol who was an administrator. Order and discipline are some of administrative management principles which were devised by Fayol (Parker & Ritson 2005, p.176). Restoring and maintaining order in an organization involves organization and commanding people.
These activities revolve around the principle of authority (Wren & Bedeian 2009, p. 223). For a firm to attain prosperity, unity of command is carried out. What this means is that a superior should give orders to employees which should come from the ruling authority.
Fayol was keen to observe that dual command is more likely to result in conflict as it threatens stability, discipline, and authority (Rodrigues 2001, p. 882). Although the term commanding seems more authoritative in the 21st century when applied in some organizations, at the time, Fayol used the term to describe the responsibility a manager has in leading and directing employees towards the achievement of organizational goals.
As noted by Maclean (2011, p.33), organizations in the 21st century use the term leadership instead of command as meaning of the process of influencing, directing and motivating employees to execute their role to work towards the realization of organizational objectives and goals. All these are achieved through order, discipline and unity of action (Parker & Ritson 2005, p.176).
To sum it up, although Henri Fayol’s theories have been criticised on more than one occasion, nonetheless, they still form the basis for contemporary management theory. The main objective of the current essay was to show that despite these criticisms, the theory still finds application in modern organizations at the management level.
Fayol was able to distinguish between responsibility and authority and to show how the two terms find application in organizations. In addition, he came up with the different roles of managers such as planning, setting goals, strategizing, and commanding, controlling and coordinating employees in the workplace.
Employees are paid for their services through the remuneration process. Managers maintain order, discipline, and setting of goals. Through management principles, an organization is able to run effectively and efficiently. Therefore, although the Fayol theories on management have some flaws, they still form a very important part of modern leadership and management.
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