Question

Explain the following principles of management given by Fayol:

1. Discipline
2. Remuneration to employees
3. Unity of command

Briefly explain any three of the following principles of management given by Henry Fayol:

1. Unity of command
2. Equity
3. Remuneration
4. Initiative

Answer the question.
Explain the following principles of management, as advocated by Henry Fayol:

1. Stability of tenure
2. Discipline
3. Unity of command
4. Unit of Direction
5. Order

Explain the following Principles of management given by Fayol with examples:

1. Unity of direction
2. Equity
3. Espirit de corps
4. Order
5. Centralisation and decentralization
6. Initiative

Explain any two principles of Fayol from the following:

1. Discipline
2. Order
3. Initiative

Answer 1

Principles of Management given by Henry Fayol:

1. Unity of Command: According to Fayol, there should be one and only one boss for every individual employee. If an employee gets orders from two superiors simultaneously, the principle of unity of command is violated. The principle of unity of command states that each participant in a formal organization should receive orders from and be responsible to only one superior. Fayol gave a lot of importance to this principle. He felt that if this principle is violated, “authority is undermined; discipline is in jeopardy, order disturbed and stability threatened”. The principle resembles military organization. Dual subordination should be avoided. This is to prevent confusion regarding tasks to be done. Suppose a sales person is asked to clinch a deal with a buyer and is allowed to give a 10% discount by the marketing manager. But the finance department tells them not to offer more than a 5% discount. Now, there is no unity of command. This can be avoided if there is coordination between various departments.
2. Equity: “Good sense and experience are needed to ensure fairness to all employees, who should be treated as fairly as possible,” according to Fayol. This principle emphasizes kindliness and justice in the behaviour of managers towards workers. This will ensure loyalty and devotion. Fayol does not rule out use of force sometimes. Rather he says that lazy personnel should be dealt with sternly to send the message that everyone is equal in the eyes of the management. There should be no discrimination against anyone on account of sex, religion, language, caste, belief or nationality etc. In practice, we can observe that now a days in multinational corporations people of various nationalities work together in a discrimination-free environment. Equal opportunities are available for everyone in such companies to rise.
3. Remuneration of Employees: The overall pay and compensation should be fair to both employees and the organization. The employees should be paid fair wages, which should give them at least a reasonable standard of living. At the same time, it should be within the paying capacity of the company. In other words, remuneration should be and equitable. This will ensure a congenial atmosphere and good relations between workers and management. Consequently, the working of the company would be smooth.
4. Initiative: Workers should be encouraged to develop and carry out their plans for improvements according to Fayol. Industry means taking the first step with self-motivation. It is thinking out and executing the plan. It is one of the traits of an intelligent person. The initiative should be encouraged. But it does not mean going against the established practices of the company for the sake of being different. A good company should have an employee suggestion system whereby initiatives/suggestions which result in substantial cost/time reduction should be rewarded.
5. Division of work: Division of work means that a given task should be divided into small groups or units so that it can be performed competently. These units are assigned to employees who specialise in it. Thus, this principle also focuses on work specialisation.
6. Authority and responsibility:  ‘Authority’ means the power to give orders and assign duties, whereas ‘responsibility’ refers to a worker’s obligation to perform the assigned tasks. According to this principle, managers should strike a balance between power and obligation. When responsibility is assigned to a person, they should also be given some authority; when a person is given authority, they should be held responsible for that work. Thus, both go hand in hand for the successful completion of the work.
7. Discipline: The principle says an organisation should follow the rules and regulations and ensure conformity to the set rules and policies. It is important for both the management and the workers to honour their commitments and make clear and fair agreements.
8. Unity of direction: Unity of direction means that each unit of an organisation works towards accomplishing one common organisational objective. According to the principle, different units having common goals should have a single head. They should frame plans and carry out tasks accordingly. This ensures elimination of overlapping and duplication of work.
9. Esprit de corps: This principle encourages building harmony and Team Spirit among the employees. The concept of I must be replaced with we. It would bring cooperation and coordination in the organisation. Mutual trust and confidence would be developed in one another. Teamwork is extremely important in large organizations which have a large workforce.
10. Order: Order basically means a place for everything and everyone in an organisation. The right arrangement of men and material will help to carry out the task smoothly. For example, if the files in an organisation are kept orderly, it would help reduce the Chaos and the time required to find each file.
11. Stability of Tenure: According to Fayol. “Employee turnover should be minimized to maintain organizational efficiency”. The stability of tenure helps to develop loyalty and attachment on the part of employees. If an employee receives a transfer order by the time he learns and gets settled in a job, it will lead to resource waste.
12. Centralisation and decentralization: The concentration of decision-making authority is called centralisation whereas its dispersal among more than one person is known as decentralisation. According to Fayol, “There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through centralisation.” The degree of centralisation will depend upon the circumstances in which the company is working. In general large organisations have more decentralisation than small organisations. For example, panchayats in our country have been given more powers to decide and spend funds granted to them by the government for the welfare of villages. This is decentralisation at the national level.