Henri Fayol

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Henri Fayols Theory of General Management
1841-1925
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Henri Fayols Background
Graduated from the National School of Mines in
Saint Etrenne in 1860 After graduation he went
to work and spent his entire career at
Commentry-Fourchamboult-Decazeville. He was
named managing director in 1888 and maintained
that position until he retired in 1918. He
is credited with saving the company from
bankruptcy During his career he lectured at
Ecole Superievre de la Guerre In his
retirement he established the Center of
Administrative Studies
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Fayols Big Contributions to Management
1) Universality of management The same skills
are needed to manage a coal mine that are needed
to manage a hospital, post office, university,
etc.. 2) Management is a field in and of
itself There were no schools of management
prior to Henri Fayol!!!
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Fayols Principles of Management
Division of Labor Fayol Encouraged job
specialization while realizing that too narrow a
focus lead to boredom and falling production
Authority Responsibility This is more than
giving and having orders followed. Fayol thought
that authority should derive from expertise,
leadership skill, knowledge, etc., and lead to a
sincere commitment from subordinates
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Fayols Principles of Management
Unity of Command Orders should be received
from only one person.
Line of Authority There should be a chain of
command from the very top to the very bottom of
the organization. Fayol realized that there
should be as few layers of management as possible
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Fayols Principles of Management
Centralization Fayol preferred a less
centralized management hierarchy. He didnt want
decisions made too far away from the problem
Unity of Direction Today we would call this
singleness of purpose
Initiative Employees should be able to act on
their own which spurs creativity and innovation
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Fayols Principles of Management
Equity employees should be treated fairly.
For personnel to be encouraged to carry out their
duties with all the devotion and loyalty of
which they are capable, they must be treated with
respect for their own sense of integrity, and
equality results from the combination of respect
and justice
Order The arrangement of positions in the
organization should maximize efficiency and
provide employees with career opportunities
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Fayols Principles of Management
Discipline Managers need to enforce rules to
achieve company goals.
Remuneration of Personnel Fayol was an early
supporter of bonuses and profit sharing plans
Stability and tenure of employees Long-term
employees lead to better producing companies.
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Fayols Principles of Management
Subordination of Individual Interests to the
common interest Employees need to understand
how their performance affects the entire
organization
Esprit de Corp Managers should develop a
shared feeling of devotion to a common cause
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Fayols Functions of Management
PLANNING
ORGANIZING
CONTROLLING
LEADING
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Fayols Qualities of Effective Plans

• UNITYAt any one time an organization should have
  only one guiding organizational goal

• CONTINUITYPlanning is an ongoing process and
  previous plans should be modified to fit together
  in the corporate framework

• ACCURACYManagers should collect and utilize all
  available information to make a plan as accurate
  as possible

• FLEXIBILITYA manager should not be stuck with a
  static plan, but be able to change and alter as
  situations do.

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Common criticisms of Henri Fayol
Management is not always universal Fayol was
criticized because he only had experience in a
coal mine. Many have said just because you can
manage a coal mine does not necessarily mean you
can manage a hospital. His writing is lessons
learned in his career Everything that Fayol
wrote about was something from his career as the
managing director of a mining company. The
criticism is that his background was not all that
diverse.
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Common Criticisms of Henri Fayol
Taylors argument Taylor thought that
specialization was the best form of management.
He thought that each worker did eight different
things and that for each thing there should be a
supervisor. Fayol thought that each person
should only have one supervisor. Further, Fayol
liked having teams do work together and making
their own decisions rather than having a
specialist do every little thing.
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Common Criticisms of Fayol
Modern Criticism Fayol refused to purchase
stock in his own company because he felt it
compromised his position as the firms managing
director. Today, managers are expected to have
their pay tied to stock because it is seen as
their job to increase shareholder wealth. Fayol,
also, wanted to board of directors and
shareholders to have limited power because he
felt they were incompetent. This is criticized
by those today who demand shareholder rights be
increased.