Management Process SchoolThinker: Henri Fayol

Introduction to Management Process School

Principles of Management - Henri Fayol

Roles of Employees, Manager, Organization

Management Process School

Proposed by French management thinker Henri Fayol.

Functions & Principles of management were treated as Universal. All types of management

All types of conditions

Does not take into account the relevant economic, technological, psychological & social aspects though it accepts that these factors have an important role.

Viewed management as a social process.

Manager is required to solve different complex problems simultaneously.

Contributors:

Henri Fayol

William H. Newman

Luther Gulick

George Terry

Lyndall Urwick

Harold Koontz

Henri Fayol (1841-1925)

o French Management Thinker

o Began his career as mining engineer & was the director of mines

o Then moved to research in geology

o Fayol then joined administrative role in the company .

oTurned around Comambault from immense financial troubles.

o On retirement he published his work on comprehensive theory of administration

o His work was popular in France but was unknown outside till 1940’s.

Modern Thought -> Functions of Manager

Planning

Organizing

Leading

Controlling

Functions of Management (Henri Fayol)

Planning

Organizing

Command

Coordination

Control

Functions of Management (George Terry)

Planning

Organizing

Actuating

Controlling

Fayol’s Qualities of Effective Plans

UNITY At any one time an organization should have only one guiding organizational goal

CONTINUITY Planning is an ongoing process and previous plans should be modified to fit together in the corporate framework

ACCURACY Managers should collect and utilize all available information to make a plan as accurate as possible

FLEXIBILITY A manager should not be stuck with a static plan, but be able to change and alter as situations do.

Time Spent on Managerial Functions

Managers at different levels in the hierarchical setup of the organization spend different time to different activities. Organizing

LowerManagement

MiddleManagement

Top Management

Planning

Controlling

Henri Fayol’s 14 Principles

ASSUMPTIONS

Management Theory is based on certain assumptions, given by Prof. Harold Koontz

Managing is a process and can be best understood by analysing the functions of the manager.

Long experience with management in a variety of enterprise situations can be the basis for certain fundamental truths or generalizations.

These fundamental truths can become focal points for useful research to ascertain validity and improve applicability in practise.

ASSUMPTIONS Contd…

• Managing is an Art, which can be improved by reliance on and understanding of principles.

• Principles in Management are nonetheless true even if a prescribed treatment or design by a practitioner in a given case situation chooses to ignore the principle or cost involved.

• Theory of management does not need to encompass the field of knowledge in order for it to serve as a scientific or theoretical foundation.

Fayol’s Principles of Management

Division of Work or Specialisation : Specializing encourages continuous improvement in skills and the development of improvements in methods. Each change of work brings in its train an adaptation which reduces output..

Authority and Responsibility: A manager should never be given authority without responsibility--and also should never be given responsibility without the associated authority to get the work done.

Fayol’s Principles of Management

Discipline: No slacking, bending of rules. The workers should be obedient and respectful to the organization. For this good leadership, explicit agreements and a system of punishment is necessary.

Unity of Command: Each employee should receive order only from one superior. This principle of Fayol ran counter to Taylor’s recommendation.

Fayol’s Principles of Management

Unity of Direction: A single mind generates a single plan and all play their part in that plan. Unity of Command cannot exist without Unity of Direction.

Gangplanks: Fayol suggested that a gangplank should be used to prevent the scalar chain from bogging action down, and without weakening the chain of command.

Fayol’s Principles of Management

Subordination of Individual Interests to General Interest: According to Fayol ,“one employee's interests or those of one group should not prevail over the organization as a whole”. Employees should be fair, and there should be constant vigilance and supervision.

Remuneration: Employees should receive fair wages for services, not what the company can get away with.

Fayol’s Principles of Management

Centralisation: Fayol regarded Centralisation as the natural order .According to him, Centralisation and decentralisation were questions of proportion.

Order: Fayol said that there should be place for everything and everyone and also “Right Man in the Right Place”. Bigger the Business , more is the difficulty in keeping this Balance.

Fayol’s Principles of Management

Equity: In running a business a ‘combination of kindliness and justice’ is needed , organization equity brings loyalty.

Stability of Tenure of Personnel: No employee should be sacked within a short time, workers perform well if there is job security.

Fayol’s Principles of Management

Initiative: Initiatives from employee side should be encouraged, workers will exhibit high level of efforts, should be done within limits of discipline and authority.

Esprit de Corps: french word, managers should encourage cohesiveness among his subordinates. Fayol was against written communication, the process should be as far as possible direct and oral

Abilities of personnel

Physical Qualities: health, physical features, vigor

Mental Qualities: ability to understand and learn, judgment, adaptibility

Moral Qualities: dignity, willingness to accept, loyalty, honesty etc

General Education: general acquaintance with matters not belonging exclusively to the function performed

Special Knowledge: particular to the function performed, be it technical, commercial, financial, managerial etc

Experience: recollection of lessons which one has oneself derived from things

Elements of Management

To forecast and plan: Examining the future and drawing up a plan of action

To Organize: Building up the structure, material and human of the undertaking.

To Command: maintain activity among personnel, lead the employees

To co-ordinate: unifying and harmonizing all activity and effort

To control: seeing the everything occurs in order with the defined plan, orders given

Activities of an Enterprise

Technical: production, manufacture, adaptation

Commercial: buying, selling, exchange Financial: search for an optimum use of

capital Security: protection of property and

persons Accounting: balance sheets, cost statistics Managerial: planning, organizing,

commanding, coordinating, controlling

Criticism of Management Process School

Universal Approach does not holds true in today’s complex environment

No significant contribution after Henri Fayol

It more or less disregards the human element, this view is countered by Behaviour School of thought

Not applicable under the conditions of high unemployment

The process approach is too static, but the organization functions under dynamic conditions

ANY QUESTIONS?

Thank You !!!

Compiled By-

Amanpreet Singh

Gunpreet Singh

Prateek Singh