The Henri Fayols 14 principle refers to a fundamental truth. It establishes cause and effect relationship between two or more variables under given situation. They serve as a guide to thought & actions. Therefore, management principles are the statements of fundamental truth based on logic which provides guidelines for managerial decision making and actions.
There are 14 Principles of Management described by Henri Fayol.
1- Division of Labor:
Managers should divide work among individuals and groups. This ensures that effort and attention will be focused on special portions of the work. Output can increase if employees are specialized. This is because they become increasingly skilled and efficient in their fields.
2- Authority:
Fayol defined authority as “the right to give orders and the power to exact obedience.” The managers should have the power to give orders. But they should also remember that with authority comes responsibility.
3- Discipline:
It is essential to maintain discipline. However, the methods for doing this can vary. Successful company will need the common effort of workers. You can apply penalties to inspire this common effort.
4- Unity of Command:
It is best if employees have only one direct supervisor.
5- Unity of Direction:
Teams, which have the same goal, should work under one manager’s direction. They should use one plan. This will guarantee that the action is coordinated properly. Unity of direction means the entire firm will move in the same direction.
6- Subordination of Individual Interests to the General Interest:
The interests of any one employee should never be given more importance than the interest of the group. Even the manager’s interest comes after the group.
7- Remuneration:
Fair remuneration should be given to everyone. This ensures employee satisfaction. Remuneration includes both financial and non-financial compensation. There are many variables which should be considered before deciding a worker’s rate of pay. Some of the variables are:
- Cost of living
- Supply of qualified personnel
- General business conditions
- Success of the business
8- Centralization & De-Centralization:
- Centralization means concentration of authority at the top level. In other words, centralization is a situation in which top management retains most of the decision making authority.
- Decentralization means disposal of decision making authority to all the levels of the organization. In other words, sharing authority downwards is decentralization.
- According to Fayol, “Degree of centralization or decentralization depends on no. of factors like size of business, experience of superiors, dependability & ability of subordinates etc.
- Anything which increases the role of subordinate is decentralization & anything which decreases it is centralization.
- Fayol suggested that absolute centralization or decentralization is not feasible. An organization should strike to achieve a lot between the two.
9- Scalar Chain:
Employees should know their position in the organization’s hierarchy. Where they stand in the chain of command is critical. Managers in hierarchies belong to a chain like authority scale. Each manager has a certain amount of authority. The President has the highest authority. The first-line supervisor has the least authority. It is important for lower level managers to inform upper-level managers about their work activities. The existence of a scalar chain is essential. It is necessary to adhere to it.
10- Order:
The workplace should be clean and safe for all employees. Everything should be in its place. All the people related to a specific type of work should be treated as equally as possible. This is good for efficiency and coordination.
11- Equity:
Managers must always be fair to staff. They are expected to maintain discipline when needed and act with kindness when it seems right.
12- Stability of Tenure of Personnel:
Managers must make an effort to reduce employee turnover. They should give priority to Personnel planning. Recruitment and Selection Costs are usually related to hiring new workers. Increased product reject rates also cost a lot. Retaining productive employees should be a high priority of management.
13- Initiative:
Employees should have the necessary level of freedom they need to make and conduct plans. Management should encourage worker initiative. New or extra work activity undertaken through self-direction is an example.
14- Esprit de Corps:
Organizations should always attempt to promote team spirit and unity. Management should inspire harmony and general good feelings among the workers.
