1. JOSE JOHN F. MENDEZ
PH.D. STUDENT
14 General Principles of
Management

2. BORN IN 1841 IN ISTANBUL, IS OFTEN KNOWN
AS THE PERSON WHO DEVELOPED A GENERAL THEORY
OF BUSINESS ADMINISTRATION. HE WAS A MINING
ENGINEER WHO WORKED AS THE MANAGING DIRECTOR
OF A BIG FRENCH MINING COMPANY NAMED AS
COMPAGNIE DE COMMENTRY-FOURCHAMBEAU-
DECAZEVILLE FOR THE LAST 30 YEARS OF HIS
WORKING LIFE (1888–1918). HE DIED IN PARIS IN
1925.
Henri Fayol

3. Division of work:
 This principle is basically the same with Adam
Smith’s “Division of Labor” which means
“specialization“. According to Fayol, the
object of division of work is to produce more
and better work with the same effort.

4. Authority and
Responsibility:
 Authority is the right to give orders and the
power to exact obedience. Distinction must
be made between a manager’s official
authority deriving from office and personal
authority.
 Responsibility is a corollary of authority, it
is its natural consequence and essential
counterpart, and wheresoever authority is
exercised responsibility arises.

5. Discipline:
 The outcome of different varying agreements,
naturally appears under the most diverse forms;
obligations of obedience, application, energy,
behavior, vary, in effect from one firm to
another, from one group of employees to
another, from one time to another. Nevertheless,
general opinion is deeply convinced that
discipline is absolutely essential for the smooth
running of business and that without discipline
no enterprise could prosper.

6. Unity of command:
 This principles emphasizes that an employee
should receive orders from one superior only.
Fayol says that if it is violated, authority is
undermined, discipline is in jeopardy, order
distributed and stability threatened.

7. Unity of direction:
 One head and one plan for a group of
activities having the same objective. (Note:
Organizations write and announce vision and
mission statements, objectives and strategies
so that the organizations align and go in the
same direction).

8. Subordination of individual
interest to the general
interest:
 This principle calls to mind the fact that in a
business the interest of one employee or
group of employees should not prevail over
that of the concern, that the interest of the
home should come before that of its
members and that interest of the state
should have pride of place over that of one
citizen or group of citizens.

9. Remuneration
(payment/compensation) of
personnel:
 Remuneration of personnel is the price of the
services rendered. It should be fair and, as far
as is possible, afford satisfaction both to
personnel and firm (employee and employer).

10. Centralization:
 Everything which goes to increase the
importance of the subordinate’s role is
decentralization, everything which goes to
reduce it is centralization. The question of
centralization or decentralization is a simple
question of proportion, it is a matter of
finding the optimum degree for the particular
concern.

11. Scalar Chain (line of
authority):
 The scalar chain is the chain of superiors from
the ultimate authority to the lowest ranks.

12. Order:
 Fayol defines the formula for order as “a place
for everyone and everyone in his place”. He
classifies two types of order as material order,
which means everything must be in its appointed
place and social order, which presupposes the
most successful execution of the two most
difficult managerial activities: good organization
and good selection. Social order demands
precise knowledge of the human requirements
and resources of the concern and a constant
balance between these requirements and
resources.

13. Equity:
 Desire for equity and equality of treatment
are aspirations to be taken into account in
dealing with employees.

14. Stability of tenure of
personnel:
 Time is required for an employee to get used to new work
and succeed in doing it well, always assuming that he
possesses the requisite abilities. If when he has got used to
it, or before then, he is removed, he will not have had time
to render worthwhile service. If this be repeated
indefinitely the work will never by properly done.
 Generally the managerial personnel of prosperous concerns
is stable, that of unsuccessful ones is unstable. Instability of
tenure is at one and the same time cause and effect of bad
running. In common with all the other principles, therefore,
stability of tenure and personnel is also a question of
proportion.

15. Initiative:
 Much tact and some integrity are required to
inspire and maintain everyone’s initiative,
within the limits imposed, by respect for
authority and for discipline. The manager
must be able to sacrifice some personal
vanity in order to grant this sort of
satisfaction to subordinates.

16. Esprit de corps:
 Means “Union is strength“. Harmony, union
among the personnel of a concern, is great
strength in that concern. The principle to be
observed is unity of command; the dangers to
be avoided are (a) a misguided interpretation
of the motto “divide and rule”, (b) the abuse
of written communications.

17. FOR LISTENING