Henri Fayol as father of modern management

Perhaps the real father of modern management theory is the French industrialist Henri Fayol.  He recognized a widespread need for principles and management teaching. Consequently, he identified 14 such principles, noting that they are flexible,not absolute, and must be usable 


Fayol's "14 Principles" was one of the earliest theories of management to be created, and remains one of the most comprehensive. He's considered to be among the most influential contributors to the modern concept of management, even though people don't refer to "The 14 Principles" often today.

He is regarded as the ‘Father of Mod­ern Management Theory’, for he was the first to suggest the functions of management which are recognised as the essen­tial part of a manager’s work by the modern authorities on management.

He was a mining engineer of a large coal mining com­pany and subsequently became its managing director. When he joined the company, it was almost bankrupt. When he re­tired after 30 years, the company was among the most suc­cessful enterprises with a long history of handsome profits and dividends.

During his successful career he searched for sound management principles. In 1916 he published his fa­mous work, ‘General and Industrial Management.’

Fayol’s work is concerned with the higher level of the organisation.

He identified the following six activities which, he believed, had to be accomplished in all industrial undertak­ings:

(i) Technical (relating to production and manufacturing);

(ii) Commercial (buying, selling and exchange);

(iii) Financial (search for capital and its optimum use);

(iv) Security (protection of property and persons);

(v) Accounting (record keeping, preparation of balance sheet, costing and statistics);

(vi) Managerial (functions of planning, organising, commanding, coordinating, con­trolling etc.).

Pointing out that the first five activities are well-known and found in all organisations, Fayol devoted most of his discussion to the analysis of managerial activities.

He divided his approach of studying management into 3 parts(a) Managerial qualities and training,(b) General principles of management, and

(c) Elements of management.

(A) Managerial Qualities and Training:

Fayol was the first person to identify the qualities required in a manager.

According to him, there are six types of qualities that a man­ager requires. These are as follows:

(i) Physical (health, vigour);

(ii) Mental (ability to understand and learn, judgement, mental vigour and adaptabi­lity);

(iii) Moral (energy, firmness, initiative, loyalty, tact, and dignity);

(iv) Educational (general acquaintance with the matters not belonging exclusively to the function performed);

(v) Technical (peculiar to the function being performed); and

(vi) Experience (arising from the work).

Fayol observed that the most important ability for a worker is technical and the relative importance of managerial ability increases as one goes up the scalar chain. He recognised a widespread need for the principles of management and managerial teaching.

He held that managerial ability should be acquired first in school and later in the workshop. In order to acquire managerial knowledge, he developed the principles of management to be taught in academic institutions.

(B) General Principles of Management:

Fayol laid down some basic principles of management. He believed in the flexibility of these principles. According to him, the light of principles, like that of light-houses guides, only those who know the way into port. He listed and described fourteen principles of management.

However, a brief summary of them is given below for quick reference:

(i) Division of Work:

Fayol has advocated it to take the advantages of specialisation. This principle can be applied at all levels of the organisation for higher producti­vity.

(ii) Authority and Responsibility:

Responsibility is the corollary of authority and arises from it.

(iii) Discipline:

Discipline is essential for successful management and, to ensure it, Fayol suggested good supervision at all levels, agreements with the employees as clear and fair as possible, and judicious imposition of penalties.

(iv) Unity of Command:

It means that an employee should get orders from only one superior. Fayol has considered unity of command as an important aspect in manag­ing an organisation. He suggested firmness and goodness on the part of the superi­ors, fair agreements with the workers and constant supervision by the managers to ensure good management.

(v) Unity of Direction:

Each group of activities having the same objectives must have one head and one plan.

(vi) Subordination of Individual Interest to Group Interest:

This principle reveals that the interest of the group should always prevail over the individual interest.

(vii) Remuneration of Personnel:

Remuneration and methods of payment should be just and fair so that maximum satisfaction can be attained by both the employers and the employees.

(viii) Centralisation:

“Everything which goes to increase the importance of the subor­dinates’ role is decentralisation, everything which goes to reduce it is centralisa­tion.” The degree of centralisation of authority should vary according to the needs of the situation.

(ix) Scalar Chain:

It is the chain of the superiors from the ultimate authority to the lowest rank. A subordinate should follow the line of authority.

(x) Order:

According to Fayol, order means “a place for everything and everything in its place” and “a place for everyone and everyone in his place”; i.e., the right man in the right job.

(xi) Equity:

Equity is a combination of justice and kindliness. The managers should exercise kindliness arid justice in dealing with the subordinates. This will create loyalty and devotion among the employees.

(xii) Stability of Tenure of Personnel:

It is a big factor for the success of an organisa­tion. Fayol pointed out that instability in tenure of service is both the cause and effect of bad management.

(xiii) Initiative:

Managers should permit the subordinates to take some initiative in think­ing out and executing plans to keep up their zeal and energy.

(xiv) Esprit de Corps:

This is the principle of ‘Union is Strength’. Team-work and proper communication among the members of the group are important for the success of an organisation. Fayol wanted the managers to encourage cohesiveness and esprit de corps among their subordinates.

(C) Elements of Management:

Fayol opines that management should be viewed as a process consisting of five elements. He has regarded these elements as the functions of man­agement. These are planning, organisation, command, co-ordination and control. According to him, ‘planning is the most important managerial function. Creation of ‘organisation struc­ture’ and execution of commanding function are necessary to implement plans.

‘Co-ordina­tion’ is necessary to make sure that everyone is working together, and ‘control’ ensures that everything is proceeding according to the plan. Fayol holds the view that these functions are required at all levels of management and in all types of organisations.

The contribution of Fayol has made the real beginning of the development of manage­ment as a separate field of study. It is true that, as a practical man, Fayol only set down the principles that he had observed and practiced; yet his observations are admirably fit for the currently developing theory of or approach to management.

Fayol was thus the first man to develop a comprehensive theory of management capable of universal application. His concepts and principles are generally accepted even today. He is, therefore, ‘the real founder of modern management’.

Criticism:

The contribution of Henry Fayol in the field of management thought is very important. He was the first person who pointed out the functions of management sepa­rately. However, in spite of such importance, his theory of management is not beyond criti­cism.

The management theory of Henry Fayol is criticised in the following aspects:

1. Higher Level Management:

The most important criticism regarding Fayol’s con­cept is that he has analysed management mainly from the view point of the top level mana­gers. He considers that the top level managers only plan vital role in making an enterprise successful. But, practically it is not true.

He has not considered the role and significance of the lower level managers of the organisation. It should be remembered that the operative employees work under the supervision and control of the lower level managers who actually get things done through the group activities of their subordinate workers.

2. Less Emphasis on Human Aspect:

Fayol has not given proper emphasis on the utilisation of human resource. In his management theory human relation aspect is neglected.

3. Negligence of Joint Management:

There is no place for joint management in Fayol’s concept of management. Modern age is the age of joint management. At present the workers also participate in management through their trade union leaders.

4. Controversial Universality of Management:

Fayol opines that the elements, prin­ciples and methods of management indicated by him are applicable to all types of enter­prises—trading or non-trading. But the principle of universality of management is very con­troversial. Because the principles of management depend on time, place, and situation of application and these are changed accordingly.

5. Ineffective in Culture-bound Management:

In recent times there is a tendency to establish culture-oriented management. Henry Fayol states that his principles can be changed, extended and rectified according to need and situation. If it can be done, the general theory do not have its utility and effectiveness.