Principles of

management

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PRINCIPLES OF MANAGEMENT
As science, management also contains some principles which are
developed by experts, Management principles are the statements of
fundamental truth which act as a guidelines for taking managerial
decisions.

Development of management principles

As the principles of science are based upon lots of practice and
experiments, similarly management principles are also not developed
overnight, a full proof procedure is adopted to develop these
principles.

Steps involved
Deep observation The first and for most thing which is essential
in any particular task is to observe everything carefully.
Management principles are developed after deep observations
only.

Repeated experiments After observing a particular situation, the

next steps to derive a solution on the basis of observation, but to
convert the solution into a principle its testing under different
situation is necessary.

Nature/Features of management principles

1.Basic and general guidelines
The principles of management are not specific statements which can
be blindly applied by the managers. They are just the basic guidelines
whose results may vary under different conditions

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2.Helps in management
The principles of management are formed to guide and help the
managers.
They precisely insist on improving the relation between managers
and workers (superior and subordinates)

3.Flexible
These principles are not fixed or rigid in nature, they are just the
guidelines.
So their application can be modified by the manager according to the
need and requirement of the organisation.

4.Formed by practice and experiments

As stated above, these principles are developed by deep observation
and repeated experiments under different conditions, and not by the
intuition of any particular person or group of persons.

5.Based on cause and effect relationship

The above statements means that these principles can tell us that if a
particular principle is applied on a specific situation then what might
be the result, but they can’t give exact or absolute result.

6.Improvisation required
As discussed earlier, these principles are only the general guidelines
and not the specific statements, so the manager has to improvise the
application of principle according to the need of the organisation.

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7.Universally accepted persvasive
As all the other principles, management principles also universally
accepted (i.e. can be applied to all kinds of organisations)
Their results may vary on the basic of nature and suitability of
organisation, but they are suitable for all kind of organization.

Importance of Management principles

1.Provides direction These principle increases the knowledge and
ability of the managers, they guides the managers in order to take
right and acceptable decision in certain situations.

2.Effective Administration The principles of management act as a

guidelines or base in the formation of policies and plans of an
organisation. It provides the managers a practical view of what they
are thinking and its expected results.

3.Optimum utilization of resources The principles of management

always emphasis on systematic and efficient working environment in
the organisation, it leads to minimisation of wastage and overlapping
of task.

4.Scientific Decision Management principles are based upon

scientific approach, that is they help the managers to approach
various problems of management in a systematic and scientific
manner.

5.Fulfilling social responsibilities The principles of management

provide equal importance and consideration to the responsibilities of
society also. These principles guide the manager to fulfill social
responsibilities also.
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6.Management training and development
The application of management requires scientific judgment and
logical thinking which forces the managers to do research and
training. As a result they act as a base for training.

Fayol’s Principles of management

Hendry fayol was born in France in 1841 Known as “Father of
management studies and thoughts”

Principles of Management by fayol

1.Principle of Division of work
According to this principle, Fayol suggested that the whole work must
be divided into smaller tasks and each individual must be assigned
with one job only and they must also be according to his capability,
qualification and experiences.
The basic phenomena of this principle was, When similar work is
performed by an individual again and again he will automatically
becomes more perfect and specialized.

Merits of using this principle

Specialization
Increases efficiency of labour

Consequences if principle is not applied

Lack of efficiency
No specialization
Chances of wastage and overlapping of work

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2.Principle of Authority and Responsibility
Authority means power to take decision, whereas
Responsibility refers to the obligation to complete the job.
Fayol suggested that there must be the balance between authority and
responsibility, that is the individual must be given authority in
matching to the given responsibility only
Merits of using this principle
No Misuse of Authority
Helps in meeting responsibilities

Consequences if principle is not applied

Misuse of Authority
Delay in work
Overburden with responsibilities

3.Principle of Discipline
Here fayol said that the word discipline does not only means following
rules and regulations but it also refers to developing commitments in
the mind of employees towards each other.
Fayol insist that discipline is required at superior as well as at
subordinate level also

Merits of using this principle

Systematic working
Increases efficiency
Reduces overlapping
Completion of task

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Consequences if principle is not applied

Confusion
Wastage of resources
Delay in work

4.Principle of unity of Command

According to this principle fayol insist that, an employee should receive
orders from one boss only. The reason behind that is if he receives
order from more than one boss then the point of confusion arises in his
mind related to which work should be done first and which one next.

Merits of using this principle

No confusion
No ego clashes
Improves efficiency
Consequences if principle is not applied
Ego Clashes
Subordinate can get excuses for non completion of task
Confusion in the mind of subordinate

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5.Unity of Direction
“One unit means one plan”
According to this principle, the efforts of all the employees in the
organization must be directed towards one direction only, that is for
the achievement of comman goal

Merits of using this principle

Achievement of organizational goal
Integrated efforts

Consequences if principle is not applied

Lack of co-ordination
Delay in achieving goal
Wastage of efforts

6.Subordination of Individual interest to general interest

According to this principle, the interest of organisation must be in the
same direction as of individual interest.
If this happens then there is no problem in achieving the goal, but if the
direction of both individual and organisation changes, then it is a task of
managers to unify their efforts and goals.

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Merits of using this principle

Achievement of organisational goal
Completion of individual goal
Co-ordination increases

Consequences if principle is not applied

Failure in achieving organisational goal
Frustrated employees

7.Principle of remuneration of persons

An adequate salary always increases the morale of a subordinate,
According to this principle fayol suggested that the employees in the
organisation must be fairly and adequately paid so that they get
maximum amount of satisfaction.
As a satisfied employee work much more efficiently

Merits of using this principle

Motivated employees
Commitment of employees increases

Consequences if principle is not applied

Increase in turnover of employees
Dissatisfaction of employees

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8.Principle of centralisation and decentralisation

Centralisation refers to concentration of powers in few hands only,
whereas
Decentralisation refers to evenly distribution of power in the
organisation

According to this principle, a company must not be completely

centralised nor decentralised, a combination of both must be
adopted
Plans and policy making decisions- centralised
General decisions - decentralised

Merits of using this principle

Benefits of centralisation as well as decentralisation
Fast decision making

Consequences if principle is not applied

Delay in actions
Misuse of power

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9.Principle of scalar chain
Scalar chain refers to the line of authority of superiors from highest
to lowest rank
Fayol insist that the chain must be strictly followed for passing
information in the organisation.
Moreover, fayol also provides a short cut path in case of emergency
and urgent information, this path is known as gang plank.
It permits direct communication between the subordinates working
at same level of authority without following scalar chain.

Merits of using this principle

Systematic flow of information
No communication gap

Consequences if principle is not applied

No role clarity
Communication gap

10.Principle of order
Under this principle, Order does not means command but here
orders signifies orderly arrangement of men and material in the
organisation.
Fayol insist that there must be a fixed place for keeping everything in
the organisation so that no time and energy is wasted in search of
any man or material.

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Merits of using this principle

Proper utilization of time
Systematic working
No wastage

Consequences if principle is not applied

Wastage of time and energy
Not able to get man and material at right time

11. Principle of Equity

It refers to equal and kind treatment of employees
According to this principle, employees would be treated with fair
behavior as only a fairely treated employ can give his/her best in work.

Merits of using this principle

Satisfied employee
Increase in efficiency
Boost the morale of employees

Consequences if principle is not applied

Dissatisfaction in employees
Unhealthy relation between superior and subordinate

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12.Stability of tenure of personnel
According to this principle fayol insist on no frequent transfer or
termination of employees. Management must provides a feeling of job
security in the minds of employees as with the feeling of insecurity an
employee can’t work with his best efforts,
Also it takes time for a person to settle down and start working, so
frequent transfers will automatically reduces his ability and efficiency

Merits of using this principle

Increases the efficiency
Reduces wastage of time and resources

Consequences if principle is not applied

Wastage of resources
Frustration in the mind of subordinate
Dissatisfaction

13.Principle of Initiative(self efforts)

Fayol insist that the employees in the organisation must be given an
opportunity to take some initiative in making and executing the plan for
which they can also be rewarded, it gives them immense satisfaction.

Merits of using this principle

Develops the feeling of belongingness
Increase the morale of employees
Increases efficiency

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Consequences if principle is not applied
Dissatisfied employees
Reduces their efficiency
Employees can’t work to their best

14.Principle of Esprit de corps

Esprit de corps-Union is strength(team work)
Fayol emphasis on team work
According to this principle, every employee in the organisation must
consider himself as a part of a team and always try to achieve the
target of the team.
Team work is far better than individual contribution

Merits of using this principle

Develops team spirit
Achievement of group goal
Creates healthy environment

Consequences if principle is not applied

No team effort
Scattered organisation
More stress on individual

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Scientific management developed by F.W. Taylor

Taylor was born in 1856 in USA
Known as “Father of Scientific Management”
Applied scientific methods on the problems of management

Scientific Management
Application of science in every element of management is known as
scientific management.
That is, knowing exactly what we actually want from our employees
and seeing that they will do it in best possible manner.

Scientific principles of management( by F.W. Taylor)

1.Science not rule of thumb
According to this principle, each and every job that is performed in
the organisation should be based on scientific enquiry and not on the
bases of intuition or by hit and trial method by higher authority.

2.Harmony, not discord

According to this principle, all the members in the organisation must
work together, that is with mutual understanding and healthy
behavior.
Both the groups (workers and management) must listen and give
regards to the problems and suggestions of each other.

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3.Co-operation not individualism
It is an extension of “Harmony not discord”
According to this principle taylor suggested that, work must be carried
on in co-operation with each other, that is with mutual confidence and
understanding for each other
Co-operation can be developed by many ways
Managers must welcome the suggestion of employees
There must be an open communication system
Workers should not go on strike and make unreasonable demand

4.Development of workers to their greatest efficiency and prosperity

The efficiency of an organisation depends upon the efficiency of its
workers, and the efficiency of workers can be increased by proper
selection and training.
According to this principle taylor suggested that the employees in the
organisation must be sent
for training on regular intervals in order to make them more efficient
and competitive.

Mental Revolution
Changing the outlook and behavior of worker and managers towards
each other and developing the sense of positive thinking and team
work in each other is known as mental revolution
What workers want- Gud salary
What managers want- efficient work
How to do mental revolution- managers must share some gain with
efficient employees

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Scientific techniques by taylor
Besides principle, taylor also suggested techniques which are
beneficial for the organisation, which are as follows

1.Functional foremanship
Taylor suggested that the factory must be divided into 2 departments
one is planning and the other is production department, and each
department must be regarded with at least 4 heads each
The reason for such division is to reduce the workload and burden of
planning department and make the work flow more smooth and easy.
Heads in each department are as follows

Under planning department

Route clerk - Responsible to fix up the sequence of steps for
mechanical and manual job
Instruction card clerk - to provide instruction
Time and cost clerk - to determine standard time and cost
Disciplinarian - Responsible for performance of job in orderly and
systematic Way

Under functional/operational department

Gang Boss - Arranges the required resources to perform a job
Speed boss - Assures timely completion of job
Repair clerk - to check functioning of machine on regular basis
and fix if required
Inspector - Keeps a check on quality control of output

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2.Standardization and simplification of work
Scientific management always emphasizes on maintaining the
standard related to every step of business operation.
Standardization does not only means quality standard but it
includes all the aspect of the product

Standardization helps in
Unity in quality of products
Setting up performance standards for men and machine
Simplification emphasis on elimination of unnecessary diversity of
product, size and types
When a company reduces its variety of products it can focus on
quality of the remaining few products which can result in increase in
sales and profit

3.Fatigue study
This study is conducted to find out the frequency, duration and
number of rest intervals required by the workers to make them more
efficient then earlier.
While performing a job, every human mind gets tired, so the need
and requirement of rest interval is necessary to get him back on
work.
Taylor suggested that the time period and frequency of rest interval
must not be decided by the wish of managers but a scientific study
must be undertaken.

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4.Method study
This study is conducted to find out the best method of production
which can minimize the cost and results to increase in profit of the
organisation
Taylor strongly suggested that the choice of method must not be
according to the rule of thumb but every method must be given a
practical approach and the best among them had to be selected.

5.Time study
This study is conducted to find out
Standard time to perform a job
Setting up the standard target for workers
Determining the number of workers required to perform a job
Categorizing the workers as efficient and inefficient
Taylor suggested that the standard time required to do a job must
not be decided on the will of manager, but time study must be
conducted to determine the standard time scientifically

6.Motion study
It is conducted
To determine the movement of workers at work place
To differentiate between productive and unproductive
movements
Cutting the unproductive movements
To design such equipments and tools which can minimize the
unproductive movements of workers
Taylor suggested that, to bring efficiency in the organisation motion
study must be conducted.
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7.Differential piece wage system
It emphasis on
Paying different rate of wages to efficient and inefficient workers
Extra and bonus wages to efficient employees will motivate them
to work in the same manner whereas it also motivates the
inefficient workers to comes in the category of efficient workers
and earn more.
When the payment is based upon the number of units produced,
it will automatically increases the level of production
Taylor suggested that the organisation must fix a standard rate of
wage for standard workers.
Workers who produce more than the standard must be paid higher
rate of wages and those who lies below the standard must be paid
with less wage rate than standard.

8.Mental revolution
It is conducted to
Change the mental attitudes of workers and managers towards
each other( in one direction)
Increase in co-operation between workers and management
Develops positive thinking in workers and management towards
each others
Taylor strongly stressed on changing the mental attitude of workers
and management towards each other and developing positive
thinking and feeling of co-operation among them.

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