Pom Cia 1

Download as docx, pdf, or txt
Download as docx, pdf, or txt
You are on page 1of 9

ANALYSIS OF

MANAGEMENT
THEORY

By:

Manohar Sivvala-2327435

Subject: Principle of Management

CIA 1 Project

Class: 1 MBA- Section E

Prof Name: Prof Krishnamurthy Thakur


Henri Fayol’s 14 Principles of Management

Henri Fayol's 14 management principles aided early twentieth-century managers in


effectively managing work and interacting with employees. The 14 Management Principles
had a considerable impact on current management thought. Because his general beliefs may
be applied to all levels of management and every department, these principles are still current
and comprehensive. Despite introducing numerous concepts and theories, Fayol is regarded
as one of the most prominent contributors and pioneers of the modern management paradigm.

Principles:

1. Division of Work
This notion is predicated on the idea that assigning a specific task to an employee will
make them more efficient and talented at it. This contrasts with a multitasking culture, in
which employees are assigned many duties simultaneously. To properly execute this
approach, consider each employee's skill set and offer them work to become proficient.

2. Authority
It indicates that a manager must have the appropriate authority to ensure his employees
follow his orders. Managers would be powerless to accomplish anything if they lacked
authority. This authority, however, should be accompanied by responsibility. According
to Henri Fayol, authority and responsibility must be balanced.

3. Discipline
This notion asserts that discipline is essential for any company to function efficiently.
Managers must create a culture of respect between individuals to attract and retain
disciplined employees. There needs to be an established set of organizational norms,
principles, and structures that everyone must follow.

4. Unity of Command
According to this notion, the company's structure should have a prominent chain of
command. Employees must be clear about whose orders they should follow. An
employee should only get orders from one manager, according to Fayol. When an
employee reports to two or more bosses, positions of power, discipline, and consistency
are jeopardized.
5. Unity of Direction
Within the teams, the chain of command must be defined. To avoid duality of
information, or receiving two contradicting commands and not understanding which one
to obey, unity of command requires that all workers obtain orders from a single
supervisor or superior. The unity of command will serve to ensure that there are no
clashes of authority.

6. Subordination of Individual Interest


In every organization, the corporation's interests must always take precedence over the
specific interests of the owners and personnel. This is the subordination of individual
interests to the company's interests. That is, it continues to be vital to prioritize what
takes place in the workplace over personal matters.

7. Remuneration
It states that staff members should receive fair compensation for their efforts. Any firm
that underpays its employees will find it challenging to motivate and retain good
employees. This remuneration should contain both monetary and non-monetary
incentives.

8. Centralization and Decentralization


Centralization is a consolidation of power at the highest level, whereas decentralization
is the spread of authority at all levels of administration. This notion states that
centralisation and decentralisation should be a healthy balance. Various criteria,
including employee experience, subordinate aptitude, etc., determine the extent of
centralization and decentralization.

9. Scalar Chain
A scalar chain is a clear line for interaction between employees and their supervisors.
Employees should understand their position in the organization's hierarchy and who to
contact in the chain of command. To put this into practice in the work environment,
Fayol recommends creating an organizational chart so that employees can easily
perceive the structure.
10. Order
This principle states that resources (human resources, cash, supplies, etc.) should be
placed in the correct location at the right time. This guarantees that resources are used
correctly and systematically. Abuse and instability in the organization will result if one
or more of these resources are misplaced.

11. Equity
According to this idea, employees should not be discriminated against because of their
religion, social class, language, or nationality. Equity ensures that superior and
subordinate relationships are coordinated. It results in the firm running smoothly and
successfully.

12. Stability of Personnel


This notion suggests sufficient efforts should be made to achieve job stability and
continuity. Employees ought to be in their positions for a fair period, according to Fayol,
because stability fosters a sense of community and encourages them to enhance their
work quality. This will improve employee efficiency while also improving the
organization's reputation.

13. Initiative
According to this notion, all employees should be encouraged to take the initiative.
Employees feel driven and valued when they have a say in accomplishing their jobs.
Organizations should listen to their employees' problems and support them to develop
and implement improvement initiatives.

14. Esprit de Corps


Esprit de Corps is French for "Team Spirit." It suggests that management should seek to
develop employee unity, morale, and cooperation. The organization benefits greatly
from team spirit. Employees that are happy and motivated have a greater capacity to be
productive as well as efficient.
Characteristics
 Universal: Management principles apply to all types of organizations, both
commercial and non-commercial. They apply at all phases of management.
 Flexible: Management principles are not set laws but instead changing guidance.
There is enough room for managerial discretion, which means they can be changed to
meet the needs of the circumstance.
 Cause & Effect Relationship: Management principles illustrate the cause-and-effect
connection among connected factors. They show what will happen as a result of
particular activities. As a result, if either has been identified, another can be found.

Evolution of Henri Fayol Principles of Management


1. Communication and teamwork are becoming increasingly important: Fayol's
original ideals were centred on the individual worker, but today's firms require the
ability to communicate and collaborate across divisions and cultures effectively. As a
result, a higher focus has been placed on principles such as communication,
teamwork, and esprit de corps.

2. The requirement for adaptability and flexibility: Because the business environment
is constantly evolving, companies must be ready to adjust their plans and processes
accordingly. Fayol's philosophies stressed preparation and stability, while modern
firms must be nimbler and more adaptable to change.

3. Technological advancement: Technology has significantly impacted how firms work,


and Fayol's principles have had to evolve to reflect this. For example, the scalar chain
idea (the chain of command) has been updated to allow for more decentralized
decision-making and communication.

Analysis of Henri Fayol’s Principles of Management using Tata Group as a


Real-Life Example
 Division of Work

Tata has a precise division of labor, with each employee assigned a distinct task. This
contributes to work completion that is efficient and effective. The Tata Steel facility in
Jamshedpur, for example, has a distinct division of labor, with each person responsible for a
certain set of activities. This contributes to the plant's ability to generate steel in an efficient
and timely manner.

 Authority and Responsibility

TATA decisions are delayed due to competing perspectives, the issue will quickly move up
the list for settlement. For example, a TATA Beverage Limited employee may be given
confidential/insider knowledge. By doing so, the corporation gives its workers the authority
to hold such information while also assuming responsibility that it will stay confidential
throughout their employment.

 Discipline

TATA has created a separate code of conduct to regulate its employees' behaviour.. Every
TATA employee, especially senior management, should conduct themselves professionally
while adhering to high moral and ethical standards. Failure to follow the code should result in
harsh repercussions, including "termination of employees."

 Unity of Direction
Tata's actions should all be aimed toward accomplishing a unified purpose. This ensures that
everyone contributes toward the same goal. The Tata Group, for example, has a clear goal
statement: "create a better tomorrow." This mission statement aids in ensuring that each of
the company's efforts are directed toward the achievement of this unified aim.
 Renumeration

Tata employees is being compensated fairly for their efforts. This aids in attracting and
retaining talented employees. Tata Steel, for example, is one of India's highest-paying
corporations. This contributes to attracting and retaining bright people who are critical to the
company's success.

 Order

TATA subsidiaries must keep their financial records in order. Internal accounting and audit
procedures must fairly and accurately reflect all company business transactions and asset
depositions. All needed information must be accessible to the company's auditors, other
authorized parties and government organizations.

 Equity
TATA Group aims to give all of its employees equal chances. According to the code of
conduct, human resource policy must promote diversity and equality in the workplace and
comply with all local labour regulations while supporting the implementation of worldwide
best practices. Everyone has the right to be heard, and those who are eligible should be given
equal opportunity, with judgments made on merit.

 Stability of Tenure

TATA Group supports "concurrent employment”. According to the corporation, its


employees are not permitted to accept any other type of employment or position of
responsibility, whether paid or unpaid, until authorized by the company. This retains
employees with the organization for a long time and allows the company to extract long-term
service.

 Esprit de Corps

TATA Group provides the following benefits to its employees to foster and promote team
spirit: -

- A work culture that encourages creativity, teamwork, and the freedom to excel.

- Performance-based rewards and growth - Most modern perks and other facilities

- Ongoing training and development opportunities at all levels.

Challenges of TATA being addressed using Henri Fayol Principle of


Management

 Growth
Tata Group is a vast and complicated organization, and Fayol's principles have been crucial
to the organization's ability to develop and expand in a systematic and orderly manner. For
example, the "division of labor" approach has aided in breaking down difficult jobs into
smaller ones that are easier to handle. This has enabled Tata Group to expand its operations
while maintaining efficiency.

 Diversification
Tata Group is a diverse conglomerate, therefore Fayol's principles have contributed to the
effective management of its various operations. For example, the "unity of command"
approach has helped to guarantee employees understand who their superior is and to whom
they should report. This has reduced confusion and conflict.

 Globalization
Tata Group is a multinational corporation, and Fayol's principles have enabled it to thrive in
diverse cultures and countries. For example, the "esprit de corps" philosophy has
contributed to an overwhelming feeling of collaboration and camaraderie among the Tata
Group's employees. This has aided the corporation in overcoming cultural obstacles and
achieving its commercial objectives.

References

1. About | Company information | capitalmarket. (n.d.). Live market news, Stock prices,

Portfolio tracker | Capitalmarket. https://www.capitalmarket.com/Company-

Information/Information/About-Company/Tata-Steel/566

2. Hungama Digital Services. (n.d.). Senior management. Steel Supplier &

Manufacturer in India | Tata Steel. https://www.tatasteel.com/corporate/our-

organisation/leadership/senior-management/

3. Meritnation.com. (n.d.). How are Henry's Fayol principle followed by Tata bewrage

company - Business studies - Important videos - 13366463 | Meritnation.com.

Meritnation: The No.1 Education Site with Study Material & Live Classes for CBSE,

ICSE, CPT, IITJEE, AIPMT &

more. https://www.meritnation.com/ask-answer/question/how-are-henry-s-fayol-

principle-followed-by-tata-bewrage-com/important-videos/13366463
4. Tata group. (n.d.). Encyclopedia Britannica. https://www.britannica.com/topic/Tata-

Group

5. (n.d.). The Tata group. Leadership with Trust. https://www.tata.com/

You might also like