ADMINISTRATIVE MANAGEMENT by Henry Fayol

 

ADMINISTRATIVE MANAGEMENT

Henry fayol , a French industrialist looked at the problem of managing an organization from the top management point of view. He has used the term administration instead of management, emphasizing that there is a unity of science of administration.

He has divided the approach of studying management into three groups-

1.Managerial Qualities:

·         Physical

·         Mental

·         Moral

·         Educational

·         Technical

·         Experience

 

2.Elements Of Management:

·         Planning

·         Organizing

·         Commanding

·         Coordinating

·         Controlling

 

3.General Management Principles:

1)      Division of workers

2)      Authority and responsibility

3)      Discipline

4)      Unity of command

5)      Unity of direction

6)      Subordination of individual interest towards general interest

7)      Remuneration of employees

8)      centralization and Decentralization

9)      Scalar chain

10)  Order

11)  Equity

12)  Stability of personnel

13)  Initiative

14)  Espirit de corps

Henry fayol has classified business operation into 6 major activities:-

Technical                             -        production

Production                          -        buying and selling

Financial                              -        Use of funds

Security                                -        protection of Resources

Accounting                          -        track of financial records  

Managerial                          -        planning and organizing business

14    RINCIPLES OF ADMINUSTRATION MANAGEMENT

 

1.      Division of Labour or work-

·         Division of work involves dividing whole work into relevant number of tasks, duties or units. Instead of assigning the whole work to a person, only a task or unit of work is assigned to him based on his skills and competencies.

·         He has stressed on the specialization of job.

·         Subdivision of work makes it simpler and results in efficiency.

·         It also helps in acquiring speed , accuracy in performance.

 

2.      Authority and responsibility-

·         authority is the right to make decisions and get them implemented by the subordinates.

·         Responsibility is the duty of a person to complete an assigned work

·         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 be given concerned authority .

·         There should be balance between the two i.e., they should go hand in hand.

·         Authority without responsibility leads to irresponsible behavior whereas responsible without authority makes the person ineffective.

 

 

3.      Discipline –

·         Discipline means engaging in desirable behavior prescribed by an organization.

·         There are two types of discipline-

 

ü  COMMAND DISCIPLINE-  It is a desirable behavior prescribed by an organization through rules and regulations.

 

ü  SELF DISCIPLINE- It comes through practice like  commitment to organization or  which springs within an individual and is in the nature of spontaneous response.

 

·         In an organization, both type of discipline are required for smooth working of an organization.

·         Adoption of this principle, results in systematic working in the organization and mutual trust among people.

 

4.      Unity of command-

·         an employee should get orders and instructions from only one superior or boss at a time.

·         adoption of this principle leads to clarity about what a subordinate has to do and fast communication of work performance.

·         Violation of this principle results in confusion about what to do and what not to do, It weakens discipline, divides loyalty and overlapping of efforts.

·          it provides a discipline , stable , and orderly organization.

 

5.      Unity of direction-

·         it means , “one plan, one boss”.

·         each group of activities having the same objectives must have one plan or one head.

·         efforts of all the members of the organization should be directed towards common goal.

·         Without unity of direction , unity of action cannot be achieved.

·         Unity of command is not possible without unity of direction.

·          Violation of this principle, results in unnecessary duplication of activities and lack of coordination in performing activities.

 

6.      Subordination of individual interest towards general interest-

·         Individual interest must be subordinated to general interest if there is any conflict between the two.

·         The general interest is the common purpose of the next higher entity/organization.

·         Adoption of this principle results in achieving goal of an organization and coordination among goals at all the levels.

·         Violation of this principle may result in frequent interest conflicts and emergence of organization politics leading to self- serving behavior.

 

7.      Remuneration of employees or personnel-

·         Remuneration of employees should be fair and provide maximum possible satisfaction to employees and employers.

·         It also includes non – financial incentives.

·         Wages should be determined on the basis of cost of living, work assigned, financial position of business etc.

·         Adoption of this principle, may result in satisfaction of employees and their commitment to work performance.

·         Violation of this principle may result in conflict between owner and employees and high rate of turnover.

 

8.      Scalar chain-

·         It is a chain of superiors ranging from top level of authority to the lowest level in the organization .

·         In this the communication, passes through the number of superior-subordinate relationship or from top to bottom level and vice versa.

·         This system results in undue delay in communication and for the sake of convenience and urgency Fayol has suggested gang plank, which is the system of direct communication between two employees not in the same chain for timely horizontal communication flow in special circumstances.

·         The gang plank is a temporary arrangement between two different points to facilitate quick and easy communication.

                                                                            

9.      Centralization and decentralization-

·         Centralization means concentration of authority at the top level / upward.

·         Decentralization means widespread distribution of authority. sharing authority downwards or decision making authority to all the levels of the organization.

·         Anything which increases the role of subordinates is decentralization whereas anything which decrease the role of subordinates is centralization.

·         Degree of centralization and decentralization depends on the number of factors like the size of the business, experience of supervisor, dependability and ability of the subordinates.

·         Adoption of this law leads to determination of appropriate level of centralization and decentralization and appropriate use of authority.

·         Violation of this law results in either higher centralization causing undue delay in decision making or high decentralization leading to coordination and control problem

 

 

10.  Order –

·         Order is concerned with proper and systematic arrangements of things and people.

·         Arrangement of things is called material order i.e, there should be safe, appropriate and specific place for every article and every place to effectively used for specific activity and commodity.

·         Arrangement of people is known as social order i.e, selection and appointment of most suitable person on the most suitable job. There should be specific place for everyone and everyone should to be in their specific place at the time of contact and if not then their subordinate must have the information about that person.

·         Adoption of this law results in procurement of resources at the right time and optimum utilization of resources.

·         Violation of this principle results in non – availability of the resources at the required time and ineffective utilization of resources.

 

11.  Equity –

·         The combination of fairness, kindness, and justice.

·         The employee should be treated with kindness and equity, if devotion is expected of them.

·         There should not be any discrimination on account of caste , creed, color, sex, religion, etc.

·         All organizational rule should be followed by everyone irrespective of position people hold.

·         Adoption of this principle results in uniformity in behavioral pattern of people which result in high morale of employees.

·         Violation of this principle , results in class conflict and feeling of harassment.

 

12.  Stability of personnel/ procurement –

·         It means reasonable security of job.

·         Employees should be kept at their position  at least for a minimum fixed period and no employees should be removed within a short period of time.

·         Unnecessary turnover is both the cause and effect of bad management.

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

·         Adoption of this law results in procurement of resources at the right time and optimum utilization of the resources.

·         Violation of this principle results in non-availability of resources at the required time and ineffective utilization of resources.

 

13.  Initiative –

·         It is taking step ahead of other in doing a work or introducing a new method of doing the work in a better way.

·         Within the limitation of authority and discipline managers should encourage the employees for taking initiative.

·         It is concerned with thinking out and executing the plan.

·         It increases zeal and energy on the part of human beings.

·         Adoption of this principle results in encouragement for creativity in an organization which helps in finding out new ways of doing better workand high satisfaction to employees.

·         Violation result in old ways of working which might be obsoletes and  demotivation for the employees.

 

14.  Espirit de corps-

·         It is a French word which means “union in strength”.

·         This principle states that management should promote team spirit among the employees.

·         The word ‘I’ should be replaced by the word ‘we’.

·         It can be achieved through unity of command.

·         Adoption of this principle results in development of team spirit, belongingness and focus on group working.

·         Violation results in lack of group harmony and focus on individual goals or individualism.

SCIENTIFIC MANAGEMENT / Elements and tools of management / Principles of Scientific management / CRITICISM / CRITICAL ANALYSIS OF SCIENTIFIC MANAGEMENT

 

SCIENTIFIC MANAGEMENT

 

The concept of scientific management was introduced by Frederick Winslow Taylor (1856-1915) in the beginning of 20^th century in USA. He was called the Father of Scientific Management.

Scientific Management was concern essentially with improving the operational efficiency at the shop floor level.

According to F.W. Taylor,

                                                “Scientific management was concerned with knowing exactly what you want men to do and then see in that, they do it in the best and cheapest way”.

 

Taylor contribution was divided into two parts –

·         Elements and tools of management

·         Principles of management

 

1.      Elements and tools of management-

Taylor conducted various experiments to his workplace to find out how human beings could be made more efficient by standardizing the work and better method of doing the work. These experiments provided the following features:-

 

1)      Separation of planning and doing-

                                                               Taylor emphasized the separation of planning aspects from actual doing of work. Before taylor’s scientific management, a worker used to plan about how he had to work and what instruments were necessary for that . The worker was put under the supervision of a supervisor. Thus supervisor’s job was merely to see how the workers were performing . This was creating a lot of problem and the Taylor emphasize that planning should be left to the supervisor and the worker should emphasize only operational work.

2)      Functional foremanship-

                                               separation of planning and doing resulted into development of supervision system which could take planning work adequately besides keeping supervision on workers.

For this purpose , Taylor evolved the concept of functional foremanship based on specialization of functions.

In this system, 8 persons are involved to direct activities of workers . Out of this 4 persons are concerned with planning and remaining 4 with production in charge. All of them give directions to the workers on different aspects of work. This is against the unity of command principle.

 

3)      Job analysis-

                         It is undertaken to find out the one best way of doing the thing. The best way of doing a job is one which requires the least movement and consequently less time and cost.

It can be determined by taking up time, motion and fatigue study.

·         TIME STUDY – it involves the determination of time, a movement to complete or the movement which takes minimum time to complete the task is the best one.

 

·         MOTION STUDY – it involves the study of movements in parts which are involved in doing a job and thereby eliminating the wasteful movements and performing only necessary movements.

 

·         FATIGUE STUDY- this shows the amount and frequency of rest required in completing the work. After a certain period of time, workers feel fatigue and cannot work with full capacity. Therefore they require rest in between the work after that they start working with full capacity.

Thus job analysis,  as given by Taylor suggest that the fair amount of a days work requiring certain movements and rest periods to complete it.

 

4)      Standardization –

                                 It should be maintained in respect of instrument and tools, period of work, amount of work, working conditions, cost of production, working hours, etc. These things should be fixed in advance on the basis of job analysis and various elements of cost that go in performing a work.

 

5)      Scientific selection and training of workers-

                                                                              workers should be selected on scientific basis taking into account, their education, work experience, aptitude, physical strength etc. A worker should be given work for which he is physically or technically most similar. Proper emphasis should be given on the training of the workers which make them more efficient and effective.

 

6)      Financial incentives-

                                    financial incentive can motivate workers to put in their maximum efforts. Its provision exists to earn higher wages by putting in extra efforts. Workers will be motivated to earn more. Taylor applied the concept of differential piece rate system which was highly motivated. Taylor has suggested that, wages should be based on individual performance and not on positions which one occupies .The wage rate should be fixed on accurate knowledge and not on estimations.

 

7)      Economy-

                      While applying scientific methods , not only scientific and technical aspects should be considered but adequate consideration should be given to economy and profits. For this, technique of cost estimation and control should be adopted. The economy and profits should be achieved by making the resources more productive as well as by eliminating the wastage .

 

 

8)      Mental revolution-

                                        Scientific management depends on the mutual corporation between the management and the workers. For this there should be mental change in both the parties i.e. from conflict to corporation.

 

2.      Principles of Scientific management-

1)      replacing the rule of thumb with science

2)      harmony in group actions

3)      cooperation

4)      maximum output

5)      development of workers

 

1)      Replacing the rule of thumb with science-

                                                                           It involves the use of scientific method in place of rules of thumb. Rules of thumb involves “trial and error method”, “hit and miss method” which is a costly affair. Scientific method involves investigation of traditional work method through work study and unifying the best practices and developing a standard method which would be followed throughout the organization.

 Scientific method denotes precision in determining any aspect of work, whereas rule of thumb emphasis estimation. For example- standardization in work, differential piece rate system/payment.

 

2)      Harmony in group actions-

                                                Taylor has emphasized that attempt should be made to obtain harmony in group actions rather than discord (conflict). Both workers and management should realize that they require each other. There should be mutual give and take situation and proper understanding so that group as a whole contribute to the maximum.

 

3)      Cooperation-

                           Scientific management involves achieving cooperation rather than chaotic individualism. Scientific management is based on mutual confidence, cooperation and goodwill. Cooperation between management and workers can be developed through mutual understanding and exchange of thinking.

 

4)      Maximum output-

                              Scientific management involves continuous increase in productivity and production instead of restrictive production either by management or by workers.

 

5)      Development of workers-

                                          It requires scientific selection of workers and providing them training at the workplace. Training should be provided to the workers to keep them fully fit and competent according to the requirement new methods of working, which may be different from the non-scientific method.

 

CRITICISM \ CRITICAL ANALYSIS OF SCIENTIFIC MANAGEMENT

 

It creates awareness about increasing operational efficiency at the shop floor level by systematic method as against the rule of thumb.

However the principle of scientific management were not concerned with the problems at the operative level and didn’t emphasize management of an organization from the managers point of view. Therefore, it was more relevant from engineering point of view rather than management point of view.

                         Taylor’s scientific management was opposed by industrialists and general public. The major reasons were-

1.      There were many of the followers of the Taylor who took aggressive mechanical view of production and side by human aspects at the workplace. This created aggressive attitude among workers.

2.      The workers used to be performed under the closed and strict supervision based on the authoritarian approach and the workers were not allowed to raise their voice even for genuine grievances. 

3.      There was lack of scientific standardization of work and whatever standards used to be set by the management the workers has to strictly follow it.

4.      Differential piece rate system was the most crucial element. The workers even the same efficient one and their union, opposed this system on the plea that it was a new method of exploiting workers by the industrialists.