Principles of Management

Concept

A principle is a fundamental truth and is generally stated in the form of cause and effect inter-relationship. Management principles are the statement of general truth providing guide to thought or action. In the words of Herbert G. Hicks, “Principles of management are the guiding rules of laws for managerial action.”
In the words of Kantooz and O’ Donnell, “Management principles are fundamental truth of general validity.” These truths are the guiding pillars in the managerial execution of functions and solution to problems. Every social science has developed its own principles. Management is also a social science and thus it has developed a number of management principles from time to time.

Drivers of Principles:

In order to derive principles following steps are taken as:

1. Observing and study of the problem: Researchers in management observe the problems carefully in different situations and from different angles. They have to study deeply the problem, its causes, magnitude, consequences and find their solutions.
2. Testing the Principles: The principles formed must be scientifically tested and verified. Before generalization of the principles testing under different situations is a must
3. Choice of the problem or opportunity: The researchers in management science identify the area where general principles of business management are lacking or need modification.
4. Making hypothesis: On the basis of observation and the data collection a hypothesis is formed, under assumed situation what is expected to happen. For example, there will be more output, as wages are paid according to piece-rate system.
5. Conclusion and forecasting: The next step will be to reach the logical conclusion and predict the specific happenings under assumed situations.

Thus, the management principles are not as exact as principles of physical sciences, because management is a social science and thus a victim of the nearness of social sciences.

Concept of Scientific Management

Scientific management is an attitude and philosophy which discards the traditional method of hit and miss, rule of thumb, trial and error of managing work and workers. It is concentrated in development and application of problem solving approach. Scientific management is a process of directing human efforts and it employs two factors: scientific method and management specialists.

The factors of scientific methods involve

1. observation,
2. measurement,
3. experiment, and
4. interference.

The management specialist can be defined as one who specializes in the application of modem scientific method to the solution of the problem. It implies the existence of a specific body of knowledge and orderly discipline to solve any problem.

Taylor’s Scientific Management

Principles: Frederick Winslow Taylor, who is also known as the father of scientific management, was one of the prominent scholars to introduce scientific system of management. According to him, “scientific management means knowing exactly what men want to do and seeing that they do in the best and cheapest way.” He emphasized that the management should not use the rule of thumb. Taylor stressed the following principles as the part of scientific management:

1. science, not rule of thumb
2. harmony not discord
3. cooperation not individual
4. development of each person to his maximum efficiency and prosperity
5. maximum output in place of restricted output
6. equal division of responsibility between management and workers
7. mental revolution of both management and workers

Taylors Four Principles of Management: 

Taylor sought to create a mental revolution among both the workers and management by creating clear guidelines for improving production efficiency. He defined four principles

1. Develop a science for each element of an individual’s work, which replaces the old rule-of-thumb method.
2. Scientifically select and then train, teach, and develop the worker. (Previously, workers chose their own work and trained themselves as best they could.)
3. Heartily cooperate with the workers so as to ensure that all work is done in accordance with the principles of the science that has been developed.
4. Divide work and responsibility almost equally between management and workers. Management takes over all work for which it is better fitted than the workers. (Previously. almost all the work and the greater part of the responsibility were thrown upon the workers.)

Limitations The common limitations of scientific management propounded by FW Taylor are

1. focus of mechanistic approach
2. ignores human relation approach
3. employees feel monotony,
4. more work load,
5. lack of initiation and
6. no focus on group work.

Fayol’s Principles of Management

Principles: Henry Fayol was a French industrialist. In 1916, he published a book known as Administration Idustrielle Generate” His book was translated into English in 1929 as “General and Industrial Administration. He has suggested fourteen principles for the efficient management of the organization. They are

1. Division of Work – This principle of management is based on the theory that if workers are given a specialized task to do, they will become skillful and more efficient in it than if they had a broader range of tasks. Therefore, a process where everyone has a specialized role will be an efficient one.
2. Authority – This principle looks at the concept of managerial authority. It looks at how authority is necessary in order to ensure that managerial commands are carried out. If managers did not have authority then they would lack the ability to get work carried out. Managers should use their authority responsibly and ethically.
3. Discipline – This principle relates to the fact that discipline is needed within an organization for it to run effectively. Organizational rules, philosophies, and structures need to be met. In order to have disciplined workers, managers must build a culture of mutual respect and motivation.
4. Unity of command – There should be a clear chain of command in place within an organization. An employee should know exactly whose instructions to follow.
5. Unity of direction – Work should be organized in a way that means employees are working in harmony toward a shared objective or goal using a shared method or procedure.
   Subordination individual interests to the collective interests – The interests of the organization as a whole should take precedence over the interests of any individual employee or group of employees. This encourages a team spirit and collective mentality of all for one and one for all.
6. Remuneration – In order to motivate and be fair to employees, they should be paid a reasonable rate for the work they carry out. An organization that underpays will struggle to attract quality workers who are motivated.
7. Centralization – This principle relates to whether decisions should be made centrally, as in from the top down, or in a more democratic way, from the bottom up. Different decision making processes are appropriate for different types of decisions.
8. Scalar chain – This relates to the principle of a clear chain of communication existing between employees and superiors. The chain should be respected, unless speedy communication is vital, in which case the chain may be bypassed if all parties consent.
9. Order – This relates to the proper use of resources and their effective deployment in a structured fashion.
10. Equity – Managers should behave ethically towards those they manage. Almost every organization in the modern world will have a written set of policies and procedures which will outline exactly what is expected from staff at all levels.
11. Stability of tenure of personnel – It is seen as desirable within an organization to have a low staff turnover rate. This is due to the benefits that come with having experienced staff and the time and expense needed to train new ones. There should be a clear and efficient method of filling any staff vacancies that arise.
12. Initiative – Employees that have input as to how to best do their job are likely to feel more motivated and respected. Many organizations place a great deal of emphasis on listening to the concerns of staff.
13. Morale – Keeping a high level of morale and team spirit is an essential part of having the most productive organization possible. Happy and motivated employees are far more likely to be productive and less absent.
14. Esprit de corps

Contribution: Henry Fayol, tried to develop a comprehensive conceptual framework and general organization and management that are applicable to all organizations. He studied management from wider perspectives which involve humanism and social awareness along with business efficiency. He has given a conceptual framework of management consisting of fourteen principles of universally applicable.

Comparison between Taylor and Fayol

Taylor and Fayol are both management scholars complementary to each other. They tried to develop a rationale and systematic basis of management. Fayol was a management philosopher and therefore his ideas are a combination of humanism and social awareness with business efficiency. On the other hand, Taylor was a management engineer. He concentrated on raising efficiency at the shop floor level A comparison between the contribution of Taylor and Fayol reveals that Fayol’s theory is more comprehensive and more widely applicable than that of Taylor.

Max Webers’s Bureaucracy Theory

Concept: Max Weber developed a theory of bureaucracy. Bureaucracy is a form of organization characterized by division of labor, a clearly defined hierarchy, details rules and regulations, and impersonal relations. There should be a hierarchy of authority involving superior-subordinate relationships and a chain of command. Clear-cut division of work based on competence and functional specialization. All employees should be responsible to their immediate superiors.

Weber’s Ideal Bureaucracy:

1. Division of Labor. Jobs are broken down into simple, routine, and well-defined tasks.
2. Authority Hierarchy. Offices or positions are organized in a hierarchy, each lower one being controlled and supervised by a higher one.
3. Formal Selection. All organizational members are to be selected on the basis of technical qualifications demonstrated by training, education, or formal examination.
4. Formal Rules and Regulations. To ensure uniformity and to regulate the actions of employees, managers must depend heavily on formal organizational rules.
5. Impersonality. Rules and controls are applied uniformly, avoiding involvement with personalities and personal preferences of employees.
6. Career Orientation. Managers are professional officials rather than owners of the units they manage. They work for fixed salaries and pursue their careers within the organization.

Principles: The major principle of bureaucracy theory of management are

1. formal rules and procedures,
2. functional specialization,
3. well-defined hierarchy of authority
4. supervision by a higher authority,
5. technical competence for employment and promotion,
6. all decisions should be recorded and
7. interpersonal relation. (Click here for Explanation)

Advantage: The advantages of bureaucratic theory are

1. focus on chain of command
2. proper division of work,
3. specific procedures,
4. relationship based on position,
5. focus on technical competency,
6. job security

Disadvantages: The disadvantages of bureaucratic theory are

1. rigid rule and regulation,
2. ignores innovation,
3. lack of effective communication,
4. problem of role conflict,
5. ignores informal relationship