Henri Fayol’s Principles of Management

Father of

Modern Management

Henri Fayol

(Istanbul, 29 July 1841–Paris, 19 November 1925)

Fayol presented 14 principles of management as general guides to the management process and management practice.

These are as under:

1. Division Of Work

Division of work in the management process produces more and better work with the same effort. Various functions of management like planning, organising, directing and controlling cannot be performed efficiently by a single proprietor or by a group of directors. They must be entrusted to specialists in related fields.

2. Authority and Responsibility

As the management consists of getting the work done through others, it implies that the manager should have the right to give orders and power to exact obedience. A manager may exercise formal authority and also personal power. Formal authority is derived from his official position, while personal power is the result of intelligence, experience, moral worth, ability to lead, past service, etc. Responsibility is closely related to authority and it arises wherever authority is exercised. An individual who is willing to exercise authority, must also be prepared to bear responsibility to perform the work in the manner desired. However, responsibility is feared as much as authority is sought after.

3. Discipline

Discipline is absolutely essential for the smooth running of business. By discipline we mean, the obedience to authority, observance of the rules of service and norms of performance, respect for agreements, sincere efforts for completing the given job, respect for superiors, etc.

The best means of maintaining discipline are

(a) good supervisors at all levels,

(b) clear and fair agreements between the employees and the employer, and

(c) judicious application of penalties. In fact, discipline is what leaders make it.

4.Unity of Command

This principle requires that each employee should receive instructions about a particular work from one superior only. Fayol believed that if an employee was to report to more than one superior, he would be confused due to conflict in instructions and also it would be difficult to pinpoint responsibility to him.

5. Unity of Direction

It means that there should be complete identity between individual and organisational goals on the one hand and between departmental goals inter-see on the other. They should not pull in different directions.

6. Subordination

Subordination of Individual Interest to General Interest In a business concern, an individual is always interested in maximising his own satisfaction through more money, recognition, status, etc. This is very often against the general interest which lies in maximising production. Hence the need to subordinate the individual interest to general interest.

7. Remuneration

According to Henri Fayol's principles of management The remuneration paid to the personnel of the firm should be fair. It should be based on general business conditions, cost of living, productivity of the concerned employees and the capacity of the firm to pay. Fair remuneration increases workers" efficiency and morale and fosters good relations between them and the management.

8. Centralisation

If subordinates are given more role and importance in the management and organisation of the firm, it is decentralisation. The management must decide the degree of centralisation or decentralisation of authority on the basis of the nature of the circumstances, size of the undertaking, the type of activities and the nature of organisational structure. The objective to pursue should be the optimum utilisation of all faculties of the personnel.

9. Scalar Chain

Scalar chain means the hierarchy of authority from the highest executive to the lowest one for the purpose of communication. It states superior-subordinate relationship and the authority of superiors in relation to subordinates at various levels. As per this principle, the orders or communications should pass through the proper channels of authority along the scalar chain. But in case there is need for swift action, the proper channels of authority may be short-circuited by making direct contact (called gang plank) with the concerned authority.

10. Order

To put things in an order needs effort. Disorder does not need any effort. It evolves by itself. Management should obtain orderliness in work through suitable organisation of men and materials. The principle of "right place for everything and for every man" should be observed by the management. To observe this principle, there is need for scientific selection of competent personnel, correct assignment of duties to personnel and good organisation.

11. Equity

Equity means equality of fair treatment. Equity results from a combination of kindness and justice. Employees expect management to be equally just to everybody. It requires managers to be free from all prejudices, personal likes or dislikes. Equity ensures healthy industrial relations between management and labour which is essential for the successful working of the enterprise.

12. Stability of Tenure of Personnel

In order to motivate workers to do more and better work, it is necessary that they should be assured security of job by the management. If they have fear of insecurity of job, their morale will be low and they cannot give more and better work. Further, they will not have any sense of attachment to the firm and they will always be on the lookout for a job elsewhere.


Initiative means freedom to think out and execute a plan. The zeal and energy of employees are augmented by initiative. Innovation which is the hallmark of technological progress, is possible only where the employees are encouraged to take initiative. According to Fayol. initiative is one of the keenest satisfactions for an intelligent man to experience, and hence, he advises managers to give their employees sufficient scope to show their initiative. Employees should be encouraged to make all kinds of suggestions to conceive and carry out their plans, even when some mistakes result.

14. Esprit de Corps

This means team spirit. Since "union is strength", the management should create team spirit among the employees. Only when all the personnel pull together as a team, there is scope for realizing the objectives of the concern. Harmony and unity among the staff are a great source of strength to the undertaking. To achieve this. Fayol suggested two things. One. the motto of divide and rule should be avoided, and two, verbal communication should be used for removing misunderstandings. Differences grow more bitter when cleared through written communication.