Fayol (1841-1925) Functions and Principles of Management

Fayol's career began as a mining engineer. He then moved into research geology and in 1888 joined, Comambault as Director. Comambault was in difficulty but Fayol turned the operation round. On retirement he published his work - a comprehensive theory of administration - described and classified administrative management roles and processes then became recognised and referenced by others in the growing discourse about management. He is frequently seen as a key, early contributor to a classical or administrative management school of thought (even though he himself would never have recognised such a "school").

His theorising about administration was built on personal observation and experience of what worked well in terms of organisation. His aspiration for an "administrative science" sought a consistent set of principles that all organizations must apply in order to run properly.

F. W. Taylor published "The Principles of Scientific Management" in the USA in 1911, and Fayol in 1916 examined the nature of management and administration on the basis of his French mining organisation experiences..

Fayol synthesised various tenets or principles of organisation and management and Taylor on work methods, measurement and simplification to secure efficiencies. Both referenced functional specialisation.

Both Fayol and Taylor were arguing that principles existed which all organisations - in order to operate and be administered efficiently - could implement. This type of assertion typifies a "one best way" approach to management thinking. Fayol's five functions are still relevant to discussion today about management roles and action.

1. to forecast and plan - prevoyance
   examine the future and draw up plans of action
2. to organise
   build up the structure, material and human of the undertaking
3. to command
   maintain activity among the personnel
4. to co-ordinate
   bind together, unify and harmonise activity and effort
5. to control
   see that everything occurs in conformity with policy and practise

Fayol also synthesised 14 principles for organisational design and effective administration. It is worthwhile reflecting on these are comparing the conclusions to contemporary utterances by Peters, Kanter and Handy to name but three management gurus. Fayol's 14 principles are:

• specialisation/division of labour
  A principle of work allocation and specialisation in order to concentrate activities to enable specialisation of skills and understandings, more work focus and efficiency.

• authority with corresponding responsibility
  If responsibilities are allocated then the post holder needs the requisite authority to carry these out including the right to require others in the area of responsibility to undertake duties. Authority stems from:
  • that ascribed from the delegation process (the job holder is assigned to act as the agent of the high authority to whom they report - hierarchy)
  • allocation and permission to use the necessary resources needed (budgets, assets, staff) to carry out the responsibilities.
  • selection - the person has the expertise to carry out the responsibilities and the personal qualities to win the support and confidence of others.

  The R = A correspondence is important to understand. R = A enables accountability in the delegation process. Who do we cope with situations where R > A? Are there work situations where our R< A?

  "judgement demands high moral character, therefore, a good leader should possess and infuse into those around him courage to accept responsibility. The best safeguard against abuse of authority and weakness on the part of a higher manager is personal integrity and particularly high moral character of such a manager ..... this integrity, is conferred neither by election nor ownership. " 1916

  A manager should never be given authority without responsibility--and also should never be given responsibility without the associated authority to get the work done.

• discipline
  The generalisation about discipline is that discipline is essential for the smooth running of a business and without it - standards, consistency of action, adherence to rules and values - no enterprise could prosper.

  "in an essence - obedience, application, energy, behaviour and outward marks of respect observed in accordance with standing agreements between firms and its employees " 1916

• unity of command
  The idea is that an employee should receive instructions from one superior only. This generalisation still holds - even where we are involved with team and matrix structures which involve reporting to more than one boss - or being accountable to several clients. The basic concern is that tensions and dilemmas arise where we report to two or more bosses. One boss may want X, the other Y and the subordinate is caught between the devil and the deep blue sea.

• unity of direction
  The unity of command idea of having one head (chief executive, cabinet consensus) with agree purposes and objectives and one plan for a group of activities) is clear.

• subordination of individual interest to the general interest
  Fayol's line was that one employee's interests or those of one group should not prevail over the organisation as a whole. This would spark a lively debate about who decides that the interests of the organisation as a whole are. Ethical dilemmas and matters of corporate risk and the behaviour of individual "chancers" are involved here. Fayol's work - assumes a shared set of values by people in the organisation - a unitarism where the reasons for organisational activities and decisions are in some way neutral and reasonable.

• remuneration of staff
  

  " the price of services rendered. " 1916

  The general principle is that levels of compensation should be "fair" and as far as possible afford satisfaction both to the staff and the firm (in terms of its cost structures and desire for profitability/surplus).

• centralisation
  Centralisation for HF is essential to the organisation and a natural consequence of organising. This issue does not go away even where flatter, devolved organisations occur. Decentralisation - is frequently centralisaed-decentralisation !!! The modes of control over the actions and results of devolved organisations are still matters requiring considerable attention.

• scalar chain/line of authority
  The scalar chain of command of reporting relationships from top executive to the ordinary shop operative or driver needs to be sensible, clear and understood.

• order
  The level of generalisation becomes difficult with this principle. Basically an organisation "should" provide an orderly place for each individual member - who needs to see how their role fits into the organisation and be confident, able to predict the organisations behaviour towards them. Thus policies, rules, instructions and actions should be understandable and understood. Orderliness implies steady evolutionary movement rather than wild, anxiety provoking, unpredictable movement.

• equity
  Equity, fairness and a sense of justice "should"pervade the organisation - in principle and practice.

• stability of tenure
  Time is needed for the employee to adapt to his/her work and perform it effectively. Stability of tenure promotes loyalty to the organisation, its purposes and values.

• initiative
  At all levels of the organisational structure, zeal, enthusiasm and energy are enabled by people having the scope for personal initiative. (Note: Tom Peters recommendations in respect of employee empowerment)

• esprit de corps
  Here Fayol emphasises the need for building and maintaining of harmony among the work force , team work and sound interpersonal relationships.

In the same way that Alfred P Sloan, the executive head of General Motors reorganised the company into semi-autonomous divisions in the 1920s, corporations undergoing reorganisation still apply "classical organisation" principles - very much in line with Fayol's recommendations.