Fayol attempted to develop a science of administration for management. In contrast to a later management expert, Peter Drucker, he believed that there was a universal science of management applicable to commerce, industry, politics, religion, war or philanthropy. He was not a theoretician and was one of the first practicing managers to draw up a list of management principles
Fayol thought that his principles would be useful to all types of managers. He truly advocated the notion that if a manager wants to be successful, he only needs a certain set of management principles. If a manager climbed the corporate ladder and reached higher positions, this manager would depend less on technical knowledge and more knowledge of administration. When Fayol worked on his principles in France, Taylor's scientific management was developing "independently" in the USA. Although he was trained as an engineer, he brilliantly realized that management of an enterprise required skills other than those he had studied.
He emphasized the role of administrative management and concluded that all activities that occur in business organizations could be divided into six main groups.
- Technical (production, manufacturing);
- Commercial (buying, selling, exchange);
- Financial (obtaining and using capital);
- Security (protection of property and persons);
- Accounting (balance sheet, stocktaking, statistics, costing);
- Managerial (planning, organizing, commanding, coordinating, controlling).
He concluded that the six groups of activities are interdependent and that it is the role of management to ensure all six activities work smoothly to achieve the goals of an enterprise.
Fayol's 14 principles of management
- Division of labor: work must be subdivided to facilitate specialization;
- Authority: authority and responsibility should go hand in hand;
- Discipline; discipline is important to develop obedience, diligence, energy and respect;
- Unity of command: subordinates must report to one superior;
- Unity of direction: all operations with the same objective must have one manager and one plan;
- Subordination of individual interest to general interest: the interest of one individual or group should not dominate the interest of the enterprise as a whole;
- Remuneration: remuneration and all other methods of payment should be fair;
- Centralization: managers always hold final responsibility but should delegate certain authority to subordinates;
- Scalar chain: a clear line of authority or chain of command should extend from the highest to the lowest level of an enterprise. This helps to ensure an orderly flow of information and complements the principle of unity of command;
- Order: there is a place for everything and everything in its place. Proper scheduling of work and timetables to complete work is important. This can facilitate the channeling of materials to the right place at the right time;
- Equity: employees should be treated with kindness and justice;
- Stability of tenure of personnel: management should work towards obtaining long-term commitments from staff and avoid unnecessary turnover of staff which is costly and works against overall goal accomplishment;
- Initiative: workers should feel like an active part of the organization through conceiving and executing plans in order to develop their capacity to the fullest;
- Esprit de corps: harmony and union help to build the strength of an enterprise. It is an extension of the principle of unity of command, emphasizing the need for teamwork and the importance of communication .
Some of these ideas may seem self-evident today, but can be seen as being revolutionary in Fayol's time. Until today, his principles remain important as they continue to have a significant impact on current managerial thinking. Fayol's main contribution was the idea that management was not a talent related to genetic hereditary, but a skill that could be taught. He created a system of ideas that could be applied to many areas of management and laid down basic rules for managing large organizations.
