Principles of Management
A
principle refers to a fundamental truth about some phenomenon. It establishes cause and effect relationship
between two or more variables and predicts the result in a specific set of
conditions. Thus, principles of management
are the fundamental truths, which provide guidelines for managerial
decision-making and action. These principles enable a manager to tackle his
problems in a scientific and systematic manner. However, these principles are
not as exact or specific as the rules of science. These should be applied
keeping in view the nature and needs of the organisation.
Nature (characteristics) of principles of management
The main characteristics of the
principles of management are given below:
1)
Universality:
The
POM are universally applicable to all kinds of organizations, may it be an
educational, a company, a Government, a hospital or any other business
undertaking. These principles are
equally useful at every level of management i.e. top level, middle level, or
lower level. The principles enable a manager to attend to his problems more
effectively.
2)
Flexible in nature:
The POM are flexible in nature. These can easily be moulded (modified) with
the change in environment. The
principles, which are suitable at one place and time, may be replaced by others, due to change in
the conditions or environment in the organization. For example, the principle
of division of labour may not be applicable in a small organization, to the
extent, as it can be applied in a large organization.
3)
Relative:
The
POM are relative and not absolute. It means results achieved through the
application of principles vary according to the number of factors like, the
environment in the org. the experience of manager, the size and nature of
business etc.
4) Directing Human Behaviour: Management is a social science,
dealing with complex human behaviour. Management principles are directed
towards regulating human behaviour for getting the best possible results. The
quality of application depends upon the quality of mangers.
5) Cause and effect relationship: Management principles indicate
cause and effect relationship between two or more events. These principles are
used to solve different managerial problems, with the help of observation,
inspection and analysis. For example; principle of division of labour can be applied
to increase efficiency and productivity.
So division of labour is the cause and increase in productivity is the
effect. A similar relation exists in the
application of other principles.
6) Equal in significance: All the principles of management
are equal in significance. It implies
that, no principle has greater importance than others. E.g., the Principle of Unity of Command is as important as the Principle of Unity of Direction, division of labour etc.
Importance
and Need For principles of management:
With the passage of time, the
managers are increasingly realizing and recognizing the need and importance of
the principles of management. The need
for learning of POM is justified on basis of following points:
1) To increase efficiency
2) To crystallize the nature of
management
3) To improve research
4) To Train Mangangers
5)
To
attain social goals
Points 1-4 Learn from book
6)
Improving
art of management: Management
principles help in the art of management by suggesting how things should be
done and how to get best results. These principles provide a means of
organizing knowledge and experience in management.
7)
Fayol’s Principles of Management:
Henery Fayol (1841-1925) was a
French Industrialist. He joined French Mining Company in1860 as an engineer and
rose to the position of its Managing Director in 1888. Through his long
practical experience, Fayol developed a general theory of management. He published a book ‘General and
Industrial Administration’ to include all theoretical principles of
administration.
Henry
Fayol suggested the fourteen principles of management which are given
below :-
1) Division of work: Division of labour means division of total
task in basic elements so that an employee can concentrate on only one type of
work. It helps to improve by avoiding wastage of time and effort caused by
change from one type of work to another.
Division of work is applicable to all kinds of work, technical as well
as managerial.
2) Authority and Responsibility: Authority
is the right to get work done from others and responsibility is the obligation
to perform the assigned task. Anyone who
exercises authority must accept responsibility.
Authority and responsibility are coexistent and they must go hand in
hand. Authority without responsibility
leads to irresponsibility and irresponsible behaviour, while responsibility
without authority will make a person ineffective. Therefore, there should be parity between
authority and responsibility.
3) Discipline: Discipline means
obedience to rules and regulations of the organization. Discipline is essential
for the smooth running of the organization. Maintenance of discipline depends
upon the quality of leadership, judicious application of rules and orders. The system of reward and penalties should be
such as would encourage respect to the authority, rules and orders of the
superiors.
4. Unity of Command: This principle implies that
subordinates should receive orders from one superior and the subordinates
should be accountable to one boss
only. In case there are more than one
superior for the subordinates, there may be conflict in authority and confusion
among subordinates. This will cause indiscipline in the organisation. There may
be conflict between subordinates and superiors. Therefore, the principle of
unity of command should be strictly observed in order to avoid conflict and
confusion.
5. Unity of Direction: By unity of
direction Henery Fayol means “one unit and one plan”. That should be one head and one plan for a group of activities having the
same objective. Unity of direction helps in the effective management of the
enterprise. If this principle is not
followed there will be unnecessary duplication of efforts and wastage of time.
Unity of command ensures coordination of efforts.
(
Difference between unity of command and unity of direction:
1.
Unity
of command relates to the functioning of people, while unity of direction is concerned with the
activities.
2.
Unity
of command means- employees should be responsible and receive orders from one
boss only. While unity of direction
means- one unit and one plan for a group of activities and these should be
under the control of one superior.
3.
Unity
of command is essential to fix responsibility of the subordinates while unity
of direction is essential for a sound organization.)
6. Subordination of individual interest
to common interest: An organization is bigger than an individual. Therefore, the interests or goals of the
organization must prevail upon the personal(
individuals ) interest of employees.
In order to achieve supremacy of group or common interest, managers must
set a good example and they must be firm but reasonable in dealing with
subordinates. Constant supervision is
necessary to prevent promotion of personal interest at the cost of the
organization.
7. Fair Remuneration: The remuneration payable to employees
should always be fair and provide maximum satisfaction to both employer and
employees. The management must ensure a fair reward for the work of the
employees and calculate wages according to the most suitable method. The rate of wages and salaries depends upon a
number of factors such as, cost of living, demand of labour, general economic
conditions, rate of wages paid by the competing firms etc. The wages and salaries should provide
sufficient incentive and promote higher productivity on the part of workers.
8. Centralization: According to
Fayol, anything that increases the importance of the subordinates is
decentralization and that reduces the importance of the subordinates is
centralisation. An organization should strive to achieve a balance between
centralization and decentralization. In
small organizations there is greater centralization while in bigger
organizations the degree of centralization decreases.
The
extent of delegation depends upon number of factors such as size of the business,
its nature, the experience of the employees and the nature of the duty to be
performed etc.
9.
Scalar chain: (Meaning-Scalar
chain is a chain of superiors from the top level to the lowest level in the
organization. The line of authority is
the route followed during the process of communication. (Significance- It is necessary to ensure unity of command
and effective communicaton. It also facilitate good discipline.
Precaution-
Henery Fayol felt that departure from the chain is necessary to make communication
fast and effective. It should be short
circuited as far as possible. This will
facilitate quick communication between one line of the chain and the other. He advised that either the chain should not
be very long or a “gang Plank” should be created between the authorities to
enable them to share information directly.
The
working of a scalar chain and the gang plank may be elaborated with the help of
the following diagram:
In this diagram there are two
chains of authority. One, flowing downwards, from A to E and the second,
flowing upwards, from I to A. I is the final
authority. Instructions, orders follow
from I to A and then from A to E .
Similarly suggestions and the
reports flow in the reverse order. It means if a message is to pass from D to G , it will
take a long time. So a Gang plank ( link) should be created between D and I to
facilitate quick communication.
10. Order: Hanery Fayol defines
this principle as “There should be a place for everything and everyone at its
place.” It means arrangement of things and placing of people. The right man, at
the right job, doing the right kind of things.
Order requires organisation and good selection and placement of both men
and materials. This will avoid
delays. The loss of energy and material
can be avoided.
11. Equity: The employees should be
treated with kindness and equity. Equity
does not exclude strictness and forcefulness.
The managers and superiors in the organization should be good natured
and experienced to deal with subordinates. They should not be biased and should
not discriminate people on the basis of cast, religion, age or experience
etc. Each subordinate should be given a
fair treatment in the matters of reward and punishment. The managers should not
give undue favour to one and neglect others.
12.
Stability of tenure: The management should make efforts to remove
feeling of insecurity of job in the mind of employees. Enough time should be given to each worker to
acquire confidence and to perform his job satisfactorily. If the job of a person is not secure, he will
look for an opportunity to leave the organization and join somewhere else. Higher labour turnover involves cost of
employing new workers, who will take time to adjust to the new job, causing
loss of production. This may damage the
reputation of the organisation as well.
13. Initiative. Workers at all levels must be encouraged to think
about and execute their task in a better way. The initiative of the
subordinates must be inspired and maintained. Workers must be encouraged to
give suggestions and improvement in the performance of their duties. They
should also be encouraged to contribute useful material in the process of
making plans.
14. Espirit-de corps (Union is Strength) : The strength of the business lies in the
cooperation and harmony of its workers. Policy of divide and rule should be
replaced by unity of command. Difference
of opinions must be settled then and there. Employees must work as a team.
Taylor's Scientific Management:
Frederick Winslow Taylor (1856-1915)
Master of Scientific Management
- His innovations in industrial engineering, particularly in time and motion studies, paid off in dramatic improvements in productivity.
- He started his Career as an apprentice mechanist in Midvlae Steel Company ( USA). Later, he became a supervisor. During this period, he continued his studies and earned a degree in Mechanical Engineering. Subsequently, he joined Bethlehem Steel Company (USA). At both these places, he continued to develop scientific management.
- Based on his experiments, he wrote many papers and book, ' Scientific Management' published in 1911, which became quite popular. Taylor called his findings as scientific management because these findings were marked differnt from other findings of earlier years.
