Summary
Highlights
In the early 20th century, organizations needed management practices. Henri Fayol synthesized 14 management principles after years of study, published in his 1916 book 'General and Industrial Management'. These principles serve as guidelines for decision-making and management actions.
The first two principles are 'Division of Work', where tasks are specialized among individuals and groups for efficiency, and 'Authority', which links the right to give orders with the power to exact obedience, and inherently involves responsibility.
The next principles are 'Discipline', emphasizing common effort and judicious use of penalties, 'Unity of Command', meaning workers should receive orders from only one manager, and 'Unity of Direction', where the entire organization moves towards a common objective.
'Subordination of Individual Interests to the General Interests' states that organizational interests should take priority. 'Remuneration' dictates that worker pay should consider factors such as cost of living, supply of qualified personnel, business conditions, and company success.
'Centralization' refers to the degree to which decision-making authority is concentrated or dispersed, depending on the organization. The 'Scalar Chain' describes the hierarchical chain of authority from top management to the lowest ranks, emphasizing the need for lower-level managers to keep superiors informed.
'Order' emphasizes treating all materials and people equally for efficiency and coordination. 'Equity' means all employees should be treated as fairly and equally as possible.
'Stability of Tenure of Personnel' prioritizes retaining productive employees to avoid recruitment costs. 'Initiative' encourages self-directed new work activities from employees. Finally, 'Esprit de Corps' highlights the importance of fostering harmony and good feelings among employees.