The 14 principles of management stated by Henry Fayol is one of the famous administration theory used in management. This is the basics of any powerful management tool used in an organization.
The 14 major principles of management are:
- Division of Work
- Authority and Responsibility
- Discipline
- Unity of Command
- Unity of Direction
- Subordination of Individual Interest
- Remuneration
- The Degree of Centralization
- Scalar Chain
- Order
- Equity
- Stability of Tenure of Personnel
- Initiative
- Esprit de Corps
1. Division of Work
In the real case, every individual employee has special skills and are specialized in different areas. They may or may not have similar skills and specialization. This principle explains the importance of distinguishing the employees based on their levels of expertise and their knowledge areas. For example, categorizing the employee from general to specialist.
This management principle promotes the efficiency of the workforce thus increasing productivity. In addition to this, specialization of the workforce increases the accuracy and the speed of the work. The"division of work" principle of management is applicable to both the technical and managerial activities of an organization.
2. Authority and Responsibility
According to Henry Fayol, authority gives the management the power to give orders to make things done by the employees. With this authority comes the responsibility. The performance helps to track back the responsibility. In other words, authority and responsibility are the two sides of a coin.
3. Discipline
This principle states the importance of having obedience. The principle of having discipline forms the essence of having good conduct and respectful interactions.
4. Unity of Command
This principle clearly defines the need to know from where the employee takes the order and to whom he must report. If an employee receives the order from one or more managers, confusion and sometimes conflicts may occur. Following this principle reduces the chances of making such mistakes.
5. Unity of Direction
The principle of "Unity of direction" emphasis on focus and unity. This highlights the fact that, all the employees perform a set of activities that finally links to the same objectives. These activities are performed by a single group that forms a team.
The activities must be enlisted as the plan of action. The ultimate responsibility of this plan of action is on the manager. He must monitor the progress of the planned activities. The efforts made by the employees and their coordination are the focus areas.
6. Subordination of Individual Interest
As per Henry Fayol, the personal interest of the individuals in an organization are subordinate to the interest of the organization. The main and primary focus is the organizational objectives. This principle of management is applicable to all the levels of the organization including the managers.
7. Remuneration
This principle conveys the importance of remuneration for the employees which promotes motivation and productivity. There are two types of remuneration namely non-monetary and monetary.
Non-monetary remuneration is conveyed in the form of compliments, assigning more responsibilities and credits. Monetary remuneration is providing a bonus or any other financial compensation. This is all about rewarding the employee for the efforts made by him.
8. The Degree of Centralization
Centralization refers to the practice of having decision making authority at the top management or the executive board level. Henry Fayol explained the process of sharing this decision making authority with the lower levels of management as decentralization.
Now, how big or small the organization, there must be a balance between the two forms of decision making.
9. Scalar Chain
Every organization must possess a clear cut hierarchy starting from the senior management to the lowest level in the organization. There should be a clear line in the area of authority from the top level to the bottom.
This way, each employee must be able to contact a manager at the top-level without challenging the hierarchy.
10. Order
According to this principle, the right resources for the employees help them to function properly in an organization. In addition to the responsibility of the managers, there must be a safe, clean and tidy working environment.
11. Equity
The equity principle focuses on the core values of an organization. This focus on the importance of treating the employees kindly and equally. Employees in the right place of an organization perform the function right. The supervision and monitoring of these functions are performed by the managers. The employees must be treated fairly without any partiality.
12. Stability of Tenure of Personnel
This principle focuses on minimizing employee turnover and to have the right employee or staff in the right place. Frequent change of position and sufficient development must be properly managed.
13. Initiative
According to Henry Fayol, employee initiatives form one of the important sources of strength of the organization. This management principle hence encourages the employees to come up with new ideas. This makes the employees be more involved in organizational development.
14. Esprit de Corps
This principle of management strives for the unity and involvement of the employees. Morale must be developed in the workplace both individually and in the area of communication. This responsibility is for the managers. The principle of "Esprit de Corps" develops the culture and creates an atmosphere of mutual understanding and trust.
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