Fayol's 14 Principles of Management

Fayol's principles are listed below:

1. Division of Work When employees are
specialized, output can increase because they
become increasingly skilled and efficient.
2. Authority Managers must have the
authority to give orders, but they must also
keep in mind that with authority comes
responsibility.
3. Discipline Discipline must be upheld in
organizations, but methods for doing so can
vary.
4. Unity of Command Employees should
have only one direct supervisor.
5. Unity of Direction Teams with the same
objective should be working under the
direction of one manager, using one plan.
This will ensure that action is properly
coordinated.
6. Subordination of Individual Interests to
the General Interest The interests of one
employee should not be allowed to become
more important than those of the group. This
includes managers.
7. Remuneration Employee satisfaction
depends on fair remuneration for everyone.
This includes financial and non-financial
compensation.
8. Centralization This principle refers to
how close employees are to the decision-
making process. It is important to aim for an
appropriate balance.
9. Scalar Chain Employees should be aware
of where they stand in the organization's
hierarchy, or chain of command.
10. Order The workplace facilities must be
clean, tidy and safe for employees.
Everything should have its place.
11. Equity Managers should be fair to staff at
all times, both maintaining discipline as
necessary and acting with kindness where
appropriate.
12. Stability of Tenure of Personnel
Managers should strive to minimize
employee turnover. Personnel planning
should be a priority.
13. Initiative Employees should be given the
necessary level of freedom to create and
carry out plans.
14. Esprit de Corps Organizations should
strive to promote team spirit and unity.

He suggested the following 14 principles as
the general principles management:
1. Division of work: This principle is basically
the same with Adam Smiths Division of
Labour which means specialization.
According to Fayol, the object of division of work
is to produce more and better work with the
same effort.
2. Authority and Responsibility: Authority
is the right to give orders and the power to exact
obedience. Distinction must be made between a
managers official authority deriving from office
and personal authority. (Note: Later in 1959,
social psychologists John French and Bertam
Raven, defined five sources of power as: coercive
power, reward power, legitimate power, referent
power and expert power).
According to Fayol, authority is not to be
conceived of apart from responsibility, that is
apart from sanction reward or penalty which
goes with the exercise of power. Responsibility
is a corollary of authority, it is its natural
consequence and essential counterpart,
and wheresoever authority is exercised
responsibility arises.
3. Discipline: Discipline, being the outcome of
different varying agreements, naturally appears
under the most diverse forms; obligations of
obedience, application, energy, behaviour, vary,
in effect from one firm to another, from one
group of employees to another, from one time to
another. Nevertheless, general opinion is deeply
convinced that discipline is absolutetly essential
for the smooth running of business and that
without discipline no enterprise could prosper.
4. Unity of command: This principles
emphasizes that an employee should receive
orders from one superior only. Fayol says that if
it is violated, authority is undermined, discipline
is in jeopardy, order distributed and stability
threatened. (Note: matrix organizations are in
contrast to Fayols unity of command principle).
5. Unity of direction: One head and one plan
for a group of activities having the same
objective. (Note: Organizations write and
announce vision and mission statements,
objectives and strategies so that the
organizations align and go in the same
direction).
6. Subordination of individual interest to
the general interest: This principle calls to
mind the fact that in a business the interest of
one employee or group of employees should not
prevail over that of the concern, that the interest
of the home should come before that of its
members and that interest of the state should
have pride of place over that of one citizen or
group of citizens. (Note: What about the
invisible hand concept of Adam Smith?)
7. Remuneration
(payment/compensation) of
personnel: Remuneration of personnel is the
price of the services rendered. It should be fair
and, as far as is possible, afford satisfaction both
to personnel and firm (employee and employer).
Three modes of payment in use for workers are :
Time rates, job rates and piece rates. Fayol also
mentioned about bonuses and profit-sharing
and non-financial incentives.
8. Centralization: Everything which goes to
increase the importance of the subordinates role
is decentralization, everything which goes to
reduce it is centralization. The question of
centralization or decentralization is a simple
question of proportion, it is a matter of finding
the optimum degree for the particular concern.
The degree of centralization must vary according
to different cases:
If the moral worth of the manager, his
strength, intelligence, experience and
swiftness of thought allow him to have a
wide span of activities he will be able to
carry centralization.
If conversely, he prefers to have greater
recourse to the experience of his colleagues
whilst reserving himself the privilige of
giving central directives, he can effect
considerable decentralization.
9. Scalar Chain (line of authority): The
scalar chain is the chain of superiors from the
ultimate authority to the lowest ranks.
10. Order: Fayol defines the formula for order
as a place for everyone and everyone in his
place. He classifies two types of order
as material order, which means everthing
must be in its appointed place and social
order, which presupposes the most succesful
execution of the two most difficult managerial
activities: good organization and good selection.
Social order demands precise knowledge of the
human requirements and resources of the
concern and a constant balance between these
requirements and resources.
11. Equity: Desire for equity and equality of
treatment are aspirations to be taken into
account in dealing with employees. (Note: In
motivation theories of organizational behaviour
equity is important. John Stacey Adams,
(behavioral psychologist) asserted that
employees seek to maintain equity between the
inputs that they bring to a job and the outcomes
that they receive from it against the perceived
inputs and outcomes of others in 1963. Please
follow the link for a visual representation of
Adams theory)
12. Stability of tenure of personnel: Time is
required for an employee to get used to new
work and succeed in doing it well, always
assuming that he possesses the requisite
abilities. If when he has got used to it, or before
then, he is removed, he will not have had time to
render worthwhile service. If this be repeated
indefinetly the work will never by properly done.
Generally the managerial personnel of
prosperous concerns is stable, that of
unsuccessful ones is unstable. Instability of
tenuer is at one and the same time cause and
effect of bad running. In common with all the
other principles, therefore, stability of tenure
and personnel is also a question of proportion.
13. Initiative: Much tact and some integrity are
required to inspire and maintain everyones
initiative, within the limits imposed, by respect
for authority and for discipline. The manager
must be able to sacrifice some personal vanity in
order to grant this sort of satisfaction to
subordinates.
14. Esprit de corps: Means Union is
strength. Harmony, union among the
personnel of a concern, is great strenght in that
concern. The principle to be observed is unity of
command; the dangers to be avoided are (a) a
misguided interpretation of the motto divide
and rule, (b) the abuse of written
communications.
(a) Personnel must not be split
up. Dividing enemy forces to weaken them is
clever, but dividing ones own team is a grave sin
against the business.
(b) Abuse of written
communications. Wherever possible, contacts
should be verbal; there is gain in speed, clarity
and harmony.

The hierarchical effect
A key aspect of the model is the
hierarchical nature of the needs. The
lower the needs in the hierarchy, the
more fundamental they are and the more
a person will tend to abandon the higher
needs in order to pay attention to
sufficiently meeting the lower needs. For
example, when we are ill, we care little
for what others think about us: all we
want is to get better.
Maslow called the first four needs 'D-
need' as they are triggered when we have
a deficit. Only self-actualization is a need
that we seek for solely positive reasons.
Maslow also called them 'instinctoid' as
they are genetically programmed into us
as essential for evolutionary survival.
Loss of these during childhood can lead to
trauma and lifelong fixation.
Click on the needs in the diagram below
for more detail, or read below for a quick
summary of each.




Note that in practice this hierarchy is only
approximate and you do not have to have
your physiologically needs fully satisfied
before going on to seeking higher needs.
In their global survey, for example, Tay
and Diener (2011) found that people can
be living in hazardous poverty and yet
still derive much satisfaction from having
social needs (belonging and esteem)
fulfilled.
The five needs
Physiological needs are to do with
the maintenance of the human
body. If we are unwell, then little
else matters until we recover.
Safety needs are about putting a
roof over our heads and keeping
us from harm. If we are rich,
strong and powerful, or have good
friends, we can make ourselves
safe.
Belonging needs introduce our
tribal nature. If we are helpful and
kind to others they will want us as
friends.
Esteem needs are for a higher
position within a group. If people
respect us, we have greater
power.
Self-actualization needs are to
'become what we are capable of
becoming', which would our
greatest achievement.