PRINCIPLES

OF
MANAGEMENT
Henri Fayol recognized that the skills that made them
good at their jobs didn't necessarily make them good
managers. He wrote, "When I assumed the
responsibility for the restoration of Decazeville, I did
not rely on my technical superiority... I relied on my
ability as an organizer [and my] skill in handling men."
14 Principles
of
Management
1. Division of Work 2. Authority
work should be divided among individuals and the concepts of authority and responsibility are
groups to ensure that effort and attention are closely related. Authority was defined by Fayol as
focused on special portions of the task. Fayol the right to give orders and the power to exact
presented work specialization as the best way to obedience. Responsibility involves being
use the human resources of the organization. accountable, and is therefore naturally associated
with authority. Whoever assumes authority also
assumes responsibility.
3. Discipline
Everyone should follow the rules. To help, you can make
agreements between the organization and employees clear
for all to see.

4. Unity of Command
Fayol wrote that "an employee should receive orders from one
supervisor only." Otherwise, authority, discipline, order, and
stability are threatened.
5. Unity of Direction 6. Collective Interest Over
Teams with the same objective should
be working under the direction of one
Individual Interest
manager, using one plan. That, Fayol Individuals should pursue team interests over
wrote, "is the condition essential to personal ones – including managers.
unity of action, coordination of strength
and focusing of effort."
7. Remuneration
Employee satisfaction depends on fair remuneration for
everyone – financial and non-financial. Fayol said pay
should be fair and reward "well-directed effort."

8. Centralization
Balancing centralized decision making (from the top)
with letting employees make decisions. Or as Fayol
wrote, "A place for everyone and everyone in his
place."
9. Scalar Chain 10. Order
Employees should know where they Fayol wrote that, "The right man in the right
stand in the organization's hierarchy and place" forms an effective social order. He
who to speak to within a chain of applied the same maxim to materials: right
command. Fayol suggested the now- one, right place. Academics note that this
familiar organization chart as a way for principle pre-empted the Just in Time (JIT)
employees to see this structure clearly. strategy for efficient production.
11. Equity
Managers should be fair to all employees
through a "combination of kindliness and
justice." Only then will the team "carry out its
duties with... devotion and loyalty."

12. Stability of Tenure of Personnel

Organizations should minimize staff turnover and
role changes to maximize efficiency. If people are
secure and good at their jobs, they are happier and
more productive.
13. Initiative 14. Esprit de Corps
Employees should be encouraged to Organizations should strive to promote team
develop and carry out plans for spirit, unity, and morale.
improvement. As Fayol wrote, "At all
levels of the organizational ladder,
zeal and energy on the part of
employees are augmented by
initiative."
FUNCTIONS OF
MANAGEMENT
• Management has been described as a social process involving responsibility for economical
and effective planning & regulation of operation of an enterprise in the fulfillment of given
purposes. It is a dynamic process consisting of various elements and activities.

• Koontz and O'Donnell explained five functions of management. They have

become widely accepted functions of management everywhere.
1. Planning
"Planning bridges the gap from where we are to where we want to go. It
makes it possible for things to occur which would not otherwise happen"
-Koontz and O'Donnel
Planning is deciding in advance
1. what to do, how to do
2. why to do
3. where to do and
4. who will be responsible for doing the planning

Importance of Planning
1. Planning provides directions
2. Planning reduces the risks of uncertainty
3. Planning reduces overlapping and wasteful activities
4. Planning promotes innovative ideas
5. Planning facilitates decision making
6. Planning establishes standards for controlling
Features of planning

1. Planning focuses on achieving

objectives
2. Planning is a primary function of
management
3. Planning is pervasive
4. Planning is continuous
5. Planning is futuristic
6. Planning involves decision making
7. Planning is a mental exercise
Planning Process
i. Setting objectives: Objectives may be set for the entire organization and each
department or unit within the organization.
ii. Developing premises: Planning is concerned with the future which is
uncertain and every planner is using conjuncture about what might happen in
future.
iii. Identifying alternative courses of action: Once objectives are set, assumptions
are made. Then the next step would be to act upon them.
iv. Evaluating alternative courses: The next step is to weigh the pros and cons of
a. each alternative.
v. Selecting an alternative: This is the real point of decision making. The best
plan has to be adopted and implemented.
vi. Implement the plan: This is concerned with putting the plan into action.
vii. Follow-up action: Monitoring the plans are equally important to ensure that
objectives are achieved.
2. Organizing

"Organization is the process of identifying and

grouping of the works to be performed, defining and
delegating responsibility and authority and establishing
relationships for the purpose of enabling people to
work most efficiently".
- Louis A. Allen
 Importance of Organizing
1. Organizing helps Organizations to reap the
benefit of specialization.
2. Organizing provides for Optimum utilization of
resources.
3. Organizing helps in Effective administration.
4. Organizing channels for Expansion and growth.
5. Organizing achieves co-ordination among
different departments.
6. Organizing creates scope for new change.
Organizing Process
1. Division of work: The first process of Organizing includes identification and division
of work which shall be done in accordance with the plans that are determined
previously.
2. Departmentation: once the work of identifying and dividing the work has been done
those are similar are to be grouped.
3. Linking departments: When the process of departmentation was completed, linking of
departments has to be done so that those departments operate in a coordinated manner
which gives a shape to overall organization structure.
4. Assigning Duties: On completion of departmentation process assigning duties i.e.
defining authority and responsibility to the employees on the basis of their skills and
capabilities has to be done, which in consequence magnifies efficiency with regard to
their work.
5. Defining hierarchal structure: Each employee should also know from whom he has to
take orders and to whom he is accountable/responsible.
3. Staffing

"Staffing is the function by which managers build an

organization through the recruitment, selection, and
development of individuals as capable employees"
- McFarland
 Importance of Staffing

1. Filling the Organizational positions

2. Developing competencies to challenges
3. Retaining personnel - professionalism
4. Optimum utilization of the human resources
Staffing Process
1. Analyzing Manpower requirements: It is making an analysis of work and
estimating the manpower requirement to accomplish the same.
2. Recruitment: It is identifying and attracting capable applicants for
employment. it ends with the submission of applications by the aspirants.
3. Selection: It is choosing the fit candidates from the applications received in
the process of recruitment.
4. Placement: This may be on probation and on successfully completion of the
same the candidate may be offered permanent employment.
5. Training and Development: It is concerned with imparting and developing
specific skills for a particular purpose.
6. Performance Appraisal: Systematic evaluation of personnel by superiors or
others familiar with their performance so as to rank employees to ascertain
their eligibility for promotions.