Principles of Management: Henri Fayol

Principles of Management

HENRI FAYOL (1841- 1925) and Administrative Management

Considered as one of the most remarkable figures in the development of Management Theories, Henri Fayol is recognized within the business and management environment as the pioneer of Administrative Management. This French engineer and director of mines was little unknown outside France until the late 40s when Constance Storrs published her translation of Fayol's 1916 " Administration Industrielle et Generale ". Fayol's theories belong to the Classical School of Management Thought which makes emphasis in managing workers and organizations more efficiently. He was the first in identify the five functions of a manager and fourteen specific principles of management. Fayol's ideas have become a universal part of the modern management concepts and are still the basis of management thought and action.

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Henri Fayol was born July 1841 in Istanbul, where his father was carrying out a compulsory military service. Fayol's family returned to France where Henri graduated from the Lycee Imperial in 1958 to then entering to study engineering at the National School of Mines at Saint Etienne at the age of 17 and graduating as an engineer in 1960. The nineteen year-old engineer was hired into the coal mine at Commentry to help solve the problem of underground fires, it is highly liked that his good knowledge and technical skills led to his promotion to manager of the mine in 1866 at the age of 25, succeeding Stephane Mony, his supervisor and mentor, who was 65. Trough all his experience Fayol began keeping note on events that occurred in the mines that affected the output, the experiences helped him to develop his future theories. In 1888 he was promoted to managing director of the Commentry- Fourchambault- Decazeville combine, this position particularly enabled Fayol to put in practice his administrative theory. From 1918 until his death in 1925 he worked to publicise his ideas on Business Administration.

" Administration Industrielle et Generale " (1916) was based on Fayol's personal observations and experiences of what worked well during his career. Administrative Management focuses on the management process and principles of management providing a theory that would apply to the organization as a whole.

Fayol identified five central elements of the management process: planning, organizing, command, coordination and control.

``the responsibility of general management is to conduct the enterprise toward its objective by making optimum use of available resources. It is the executive authority, it draws up the plan of action, selects personnel, determines performance, ensures and controls the execution of all activities''

Fayol 1949

Planning is related to: forecast, examine how the future would be like; and foresight, prevent and design actions in advance. It is necessary to identify what are the goals and how to accomplish them through a strategy, considering the realistic capabilities and resources to determine appropriate organizational goals.

``The best of plans cannot anticipate all unexpected occurrences which may arise, but it does include a place for these events and prepare the weapons which may be needed at the moment of being surprised'' (Fayol, 1949, p. 49).

The organizing element of Fayol's theory embraces the decision of how to allocate time and effort building up the structure. In detail, it includes matters such as selecting staff, revising electronic systems and selecting the best supplier. At this point, Fayol was more concern about the people within the organization:

“of two organizations similar in appearance, one may be excellent, the other bad, depending on the personal qualities of those who compose them” (Fayol, 1949, p. 57).

“Command” was the term used by Fayol to describe the action of maintain activity among the staff, setting activities and people in motion.

“In business administration, the question of [managing] people represents more than one-half of the problem'' (Blancpain, 1974, p. 24).

Coordination means that each part of an organizations has to be in harmony with the others. Since a business has different departments with different objectives and activities, the job of a manager is to bind them together unifying their activities and efforts in order to conduct the enterprise toward its objective.

Controlling is the last element of Administrative management discussed by Fayol and consists of monitoring that everything occurs in conformity with policy. It requires information to compare performance with the established goals and see how well they were accomplished.

``A good system of control provides against undesirable surprises, capable of degenerating into catastrophes'' (Fayol, 1949, p. 109).

These five roles of a management process described by Henry Fayol are practical and, in my pinto of view, they have certainly influenced the modern theories and current ways of management, and most important, they form a “common sense” process with defined steps to follow.

Fayol also identified fourteen principles of administration that managers should use in performing their functions. It is important to stress that the following principles are not rigid and may apply to all organizations.

“It is all a question of proportion... allowance must be made for different changing circumstances... the principles are flexible and capable of adaptation to every need; it is a matter of knowing how to make use of them, which is a difficult art requiring intelligence, experience, decision and proportion.” (Fayol, 1949, p.14)

The first principle is “Division of work” Fayol believes that if a person specializes he or she will concentrate in the same matters and acquire an special ability and accuracy that will increase the effectiveness and consequently the productivity. This is true, not everyone can do everything but everyone can do something. However, an exaggeration of a repetitive task may produce boredom and, if it is physical, health damages.

“Authority and responsibility” Fayol remarks that authority comes with responsibility and vice versa. A manager shouldn't be given authority without responsibility and should never be given responsibility without the associated authority to get the things done. Fayol stated this point 67 years ago and still today I can see responsibility and authority don't always come together as equal, and this is a major moral problem that causes a mediocre development in public and private enterprises.

“Discipline” is the third principle and it is certainly essential for the smooth running of business and without standards or adherence to policies no enterprise could prosper.

Due to his experience during his six years as an engineer at the coal mine, Henri Fayol realized the problems that different orders from different bosses may bring and proposed the “unity of command” which means that an employee should receive instructions from one superior only. It is important to have one general boss to avoid conflict and confusion.

“Unity of direction” means that if one person is the head or chief, then there is one plan and everyone should follow it. It's essential to focus the effort in the same direction.

Unity of command and direction are violated in the present time by matrix structures in many of today's companies, and although the aim of this organizations is combine personnel in order to increase effectiveness they usually are target for conflict or confusion between staff.

The next principle is the “subordination of individual interests to general interests” this would spark a lively debate, especially between collectivists and individualistic cultures. However, I consider that while a person is working, his mind and thoughts should be about the job and business goals, it is important to separate personal and business affairs but since we are human beings with emotions and interests, is a managerial role to make the employees feel free while leading them to accomplish a enterprise's goal.

Every worker is worthy of his salary, and it must be totally fair and in the best case it would satisfies the firm and the employee. This principle is analysed by Fayol as the “remuneration of personnel.

“Centralisation” Fayol remarks that the degree of centralization varies according to different cases. Many companies apply this theory, in some cases or projects a manager could share initiative with subordinates in order to get new ideas or due to the number of projects that he is in charge. Centralisation is about proportion and individual cases.

The “chain of superiors” is related with the centralisation, it refers to the line of authority. Fayol states pointed that some procedures need speedy actions and for this reason it is just needed the approval of the immediate superior.

The tenth principle is “order”, it refers to the working place. Everything has a place and should be there.

The “equity” of an organization comes as the eleventh principle. A sense of justice and fairness should pervade in an organization. Employees will work much better under the authority of friendly and fair managers rather than under the yoke of a unfair and despot one.

According to Fayol the “stability of tenure of personnel” is a reflection of a good running of the business, an employee takes time to adapt to a position and a turnover is not efficient.

Thinking out a plan and do what it takes to make it happen is commonly known as “initiative”. Fayol said that the initiative of all represents a great resource of strength for businesses and that a manager should sacrifice some vanity in order to grant satisfaction to subordinates. This statement is true, In my experience I have seen and feel the satisfaction to take initiative and see its outcomes, it is unbelievable the feeling of proud and confidence that it generates. I agree with Fayol with the idea of sharing initiative and let subordinates to do something by their own, this will increase their confidence and so they might feel more valuable for the company.

“Esprit the corps” is the last principle and it emphasises the harmony among the personnel and its maintenance. To accomplish this objective, Fayol impulse the efficient team work and the use of verbal rather that written communication when it is simpler and quicker.

Administrative management has been criticized as being rigid and inflexible and related to Taylor's scientific management. I must make clear that though both theorists were task oriented, Fayol's approach was authority and its implementation while Taylor focused on effectiveness and production. Fayol's theories are also related to Weber's and his Bureaucratic superstructure, the difference comes up with Weber's perception of a completely impersonal organization with poor human interaction. Fayol, in the other hand, points out his believe in personal effort and team dynamics as part of the “ideal” organization in the last two principles of his theory.

The management process (roles) and the fourteen principles of management are a great contribution to management and business studies. Henri Fayol's Administrative Management theory is a general description of the activities of a manager and the principles of any organization. Personally I agree with most of the points and I think that they are very satisfying and practical theories. Although administrative management has been seen as rigid and inflexible, it still influences management thought and practice. The five roles described as management process and functions by Fayol remain in use today as the way to organize management knowledge, in fact, most management books are divided by chapters in accordance to Fayol's theory. It is particularly interesting for me his career and the way he experimented the different levels of an organization. I consider his fourteen principles of management as the foundations of any organization, and although these principles are apparently designed for predictable and routine situations, many parts of business must run in this way. Fayol himself advised that “proportion” is everything, even businesses that work under a changing environment and are forced to innovate can apply these principles in different proportions and at different times, the same happens with the application of the five roles of management.

I chose Henri Fayol's work because after reading many theories and biographies I found that his precepts remain important for the understanding of management since he was a successful senior manager who sought to bring order to his personal experiences. As I stated previously, his ideas are complete and his theories embrace the organization as a whole, making administrative management a valuable theory within management sciences. However, his theory may be implemented and developed in the present time by adding more human-related principles focusing a little more in the relations and behaviour of the personnel. It is clear that modern organizations are strongly influenced by Henri Fayol's theories and it is difficult to believe that this precepts were originally and new ninety seven years ago and nowadays they are so widely used that have become part of a “common sense” idea of running a business.

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