During the Industrial Revolution, it became obvious that the ways companies operated their businesses had to drastically change. While many people were in agreement that change was inevitable, pioneers in management theory differed in how they believed things should change and operate.
Principles or theories of management are generally organizational principles used as a guideline for determining the overall direction of the company’s performance. An example of this would be a manager determining whether or not to promote an employee based on the principle of seniority, while another manager would be determining based on the principle of quality.
Lets talk about Fayol and Taylor Theories as management theories, which helped to form the base of management as it is known today.
Henri Fayol Theories of Management
Henri Fayol (1841–1925) was a French management theorist and industrialist who is often regarded as one of the founding fathers of modern management theory. Fayol’s work laid the foundation for the development of administrative management theory, and he is best known for his fourteen Principles of Management, which he outlined in his influential book, “Administration Industrielle et Générale” (1916) or “General and Industrial Management.”
Henry Fayol, gave a new perception on the concept of management. He introduced a general theory that can be applied to all levels of management and every department. He envisioned maximizing managerial efficiency. Today, Fayol’s theory is practised by the management to organize and regulate the internal activities of an organization.
Here are Henri Fayol’s fourteen Principles of Management:
Division of Work:
- This principle emphasizes the specialization of tasks and duties. Specialization increases efficiency and expertise within a specific area.
Authority and Responsibility:
- Authority is the right to give orders and the power to exact obedience. Responsibility is the obligation to perform the assigned tasks. Fayol believed that authority and responsibility should go hand-in-hand.
- Discipline refers to obedience, respect for authority, and the observance of established rules. Fayol stressed the need for a clear and fair disciplinary system within organizations.
Unity of Command:
- Each employee should receive orders from only one superior to avoid confusion and conflicts in the chain of command.
Unity of Direction:
- Teams with similar objectives should be under the direction of a single manager using one plan. This ensures that everyone is working towards the same goals.
Subordination of Individual Interests to the General Interest:
- The interests of the organization should take precedence over individual interests. Employees should prioritize collective goals over personal gains.
- Compensation should be fair and provide satisfaction to both employees and employers. Fayol advocated for a balance between financial and non-financial rewards.
- The degree to which authority and decision-making are concentrated at the top of the organization. Fayol believed that the level of centralization should depend on the specific circumstances of each organization.
Scalar Chain (Chain of Command):
- The chain of authority from the highest to the lowest ranks in the organization should be clearly defined. Communication should follow this chain to avoid confusion.
- Both material and human resources should be arranged in the most productive manner. A systematic arrangement helps in the efficient utilization of resources.
- Managers should be fair and just in their dealings with subordinates. This includes fair treatment and impartial application of rules and policies.
Stability of Tenure of Personnel:
- Employee turnover can be disruptive and costly. Fayol advocated for stability in personnel to promote efficiency and consistency.
- Employees should be encouraged to take the initiative in their work. Fayol believed that giving employees the freedom to create and carry out plans fosters a sense of ownership and motivation.
Esprit de Corps:
- Team spirit and harmony should be promoted among employees. A positive work environment contributes to higher morale and increased productivity.
Frederick Winslow Taylor Theories of Management
Frederick Winslow Taylor (1856–1915) was an American mechanical engineer and one of the earliest management theorists. He is best known for his scientific management principles, which aimed at improving efficiency and productivity in industrial settings. Taylor’s ideas had a profound impact on the development of management theory and practice.
Frederick Winslow Taylor developed and published his Scientific Management Theory in 1909. At its core, scientific management theory believes that it is vital to find the most effective way to complete each and every task, no matter how small.
Taylor argued each task should be completed as efficiently as possible. In addition, everyone should be assigned a particular job based on their skills and abilities and must be evaluated based on the quantity and quality of their work. Taylor did not think it was fair or cost effective to pay every employee the same amount, regardless of their output.
Here are the major components of Taylor’s theories of management:
- Taylor’s primary contribution to management thought was the concept of scientific management. He believed that management decisions and actions should be based on scientific principles and methods rather than tradition or rule of thumb.
Time and Motion Studies:
- Taylor conducted time and motion studies to analyze and optimize work processes. He sought to identify the most efficient way to perform each task by breaking it down into its smallest components. This approach helped in eliminating unnecessary movements and improving overall efficiency.
Standardization of Work:
- Taylor advocated for the standardization of tools, equipment, and work methods to eliminate variations in production processes. Standardization was seen as a way to reduce inefficiencies and ensure consistency in performance.
- Taylor proposed the implementation of a piece-rate system, where workers were paid based on the number of units they produced. This system aimed to provide financial incentives for workers to increase their productivity.
- Taylor introduced the concept of functional foremanship, which involved dividing the traditional role of a foreman into specialized functions. For example, there would be a planning foreman, a production foreman, an inspection foreman, etc. Each specialist would focus on a specific aspect of management, leading to increased efficiency.
Selecting and Training Workers:
- Taylor believed in selecting workers with the right abilities for each job and then training them to perform their tasks in the most efficient manner. He argued that this approach would result in a better match between workers and their roles.
Cooperation Between Management and Workers:
- Taylor emphasized the need for a cooperative relationship between management and workers. He believed that both parties could benefit from increased efficiency, and he sought to align their interests through methods such as profit-sharing.
Hierarchy of Management:
- Taylor’s theories supported a clear hierarchy in organizations. He believed that decisions should be made at the top levels of management and then implemented throughout the organization. This hierarchical structure was seen as essential for maintaining order and efficiency.
- Taylor advocated for breaking down tasks into specialized functions, with each worker focusing on a specific aspect of the production process. This specialization was expected to lead to increased efficiency and expertise in each function.
- Taylor’s system relied on providing monetary incentives to workers based on their performance. He believed that financial rewards would motivate workers to increase their productivity.
Fayol vs Taylor Theories: Key Differences
|Managerial functions and principles
|Scientific management and efficiency
|Scientific management theory
|Nature of Management
|Comprehensive and general principles
|Specific and specialized techniques
|Applicable to all types of organizations
|Primarily suited for manufacturing industries
|Emphasized the importance of fair treatment, equity, and employee satisfaction
|Focused on financial incentives and piece-rate system for motivating workers
|Identified five key functions: planning, organizing, commanding, coordinating, and controlling
|Focused on scientific methods for optimizing work processes, emphasizing time and motion studies
|Stressed the importance of harmony and unity between workers and managers
|Advocated a clear distinction between the roles of workers and managers, with managers responsible for planning and workers for execution
|Scope of Influence
|Fayol’s principles are more broad and encompassing, covering various aspects of management
|Taylor’s principles are more specific, concentrating on the operational aspects of work efficiency