Adminsitrative Theory

 Henry Fayol of France developed this theory. This approach focuses on principles that can be used by managers to coordinate the internal activities of organizations like planning, organizing, directing and controlling. It explained the process of managing an organization from the top managerial perspective.

Henry Fayol has given fourteen principles of management which are as follows:

1. Division of Work:

Henry Fayol has stressed the specialization of jobs. He recommended that work of all kinds must be divided and subdivided and allotted to various persons according to their expertise in a particular area. Subdivision of work makes it simpler and results in efficiency, which also leads to specialization.

2. Authority and Responsibility:

Authority and responsibility are co-existing, without them, there is irresponsible behavior. If authority is given to a person, he should also be made responsible. In the same way, if anyone is made responsible for any job, he should have concerned authority. Authority refers to the right of superiors to get exactness from their subordinates whereas responsibility means an obligation for the performance of the job assigned.

3. Principle of One Boss/Unity of Command:

A subordinate should receive orders and be accountable to one and only one boss at a time. In other words, a subordinate should not receive instructions from more than one person because it,

  • Undetermined authority
  • Divides loyalty
  • Delays and chaos
  • Duplication of work
  • Weakens discipline
  • Creates confusion
  • Escaping responsibilities
  • Overlapping of efforts
Therefore, dual subordination should be avoided unless and until it is absolutely essential.

4. Unity of Direction:

Fayol advocates one head one plans means that there should not be one plan for a group of activities having similar objectives. Related activities should be grouped together. There should bed one plan of action for them and they should be under the charge of a particular manager.

According to this principle, the efforts of all the members of the organization should be directed towards a common goal, because it leads to unity of action.

5. Equity:

Equity means a combination of fairness, kindness and justice along with control. It implies that managers should be fair and impartial while dealing with the subordinates and give similar treatment to people at the same level. They should not discriminate with respect to age, caste, sex, religion, relation etc. Fayol was of opinion that, "at times force and harshness might become necessary for the sake of equity".

6. Order:

This principle is concerned with the proper and systematic arrangement of things and people in an organization. Arrangement of things is called material order and placement of people is called social order. These are

Material Order: There should be a safe, appropriate and specific place for every article and every place to be effectively used for specific activities and commodities.

Social Order: Selection and appointment of the most suitable person for the suitable job. there should be a specific place for everyone so that they can easily be contacted whenever the need arises.

7. Discipline:

According to Fayol, "Discipline means sincerity, obedience, respect of authority and observance rules and regulations of enterprise." This principle states that subordinates should respect their superiors and obey they order, this ensures smooth functioning. Discipline can be enforced if there are competent superiors, fair agreement along adequate punishment.

8. Initiative:

Workers should be encouraged to take initiative in the work assigned to them, without being asked to do so. Fayol advised that management should provide opportunities to its employees to suggest ideas, experiences and new methods of work, as it builds an environment of trust and boosts morale. They can be encouraged with the monetary and non-monetary incentives

9. Remuneration of Employees:

The quantum and method of remuneration to be paid to the workers should be fair, reasonable, satisfactory and rewarding of the efforts. As far as possible, it should accord satisfaction to both employer and the employees. Wages should be determined on the basis, of cost of living, work assigned, the financial position of the business, wage rate prevailing etc. Logical and appropriate wage rates and methods of their payment reduce tension and differences between workers. Fayol also recommended the provision of other benefits such as free education, medical and residential facilities to workers.

10. Stability of Tenure:

Fayol emphasized that employees should not be moved frequently from one job position to another i.e. the period of service in a job should be fixed.

According to Fayol, "time,e is required for an employee to get used to new work and succeed doing it well but if he is removed before that he will not be able to render worthwhile services". As a result, the time, effort and money spent on training the workers will go to waste.

Stability of job creates team spirit and sense of belongingness among workers which ultimately increase the quality as well as quantity of work.

11. Scalar Chain:

Fayol defines, "Scalar chain is the chain of superiors ranging from ultimate authority to the lowest". Every order, instruction, message, request, explanation etc. has to pass through the scalar chain. But, for the sake of convenience and urgency, this path can be cut short and this shortcut is known as 'Gang Plank'. A Gang Plank is a temporary arrangement between two different points to facilitate quick and easy communication. 

Gang Plank clarifies that management principles are not rigid rather they are very flexible. They can be molded and modified as per the requirements of situations.

12. Subordination of Individual Interest of General Interest:

As the organization is much bigger than the individual it constitutes, therefore, investing in the undertaking should prevail in all circumstances. As far as possible, reconciliation should be achieved between individual must sacrifice for bigger interests.

13. Espirit De'corps:

It refers to team spirit, i.e. harmony in the workgroups and mutual understanding among the members promotes hard work. Fayol cautioned the managers against dividing the employees into competing groups because it might damage the morale of the workers and the interest of the undertaking in the long run. He also cautioned against the more use of Britain communication to the subordinates i.e. face-to-face communication should be developed. The managers should infuse team spirit and belongingness. There should be no place for misunderstanding. People then enjoy working in the organization and offer their best towards the organization.

14. Centralisation and Decentralisation:

An organization must balance between centralisation and decentralisation. Centralisation means concentration of authority at the top level. decentralisation means disposal of decision-making authority to all the levels of the organization. According to Fayol, "Degree of centralization or decentralization depends on a number of factors like size of business, the experience of superiors, dependability and ability of subordinates etc."

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