Henri Fayol: A Visonary...

Fayol is one of the greatest thinkers in the field of administration. He was a classical management theorist, widely regarded as the father of modern Operational Management Theory. His ideas are a fundamental part of modern management concepts. Therefore, He is considered as the Father of Classical Theory of Public Administration and also considered as the founder of the Management Process School. His classical work Industrielle et Generale laid the foundation of Classical Management Theory.

His work Industrielle et Generale was first published in French (1916), but it did not come to light in the English speaking countries until its English translation published in 1949 under the title General and Industrial Management.

About Henri Fayol:

Henri Fayol was born in Constantinople, Istanbul, Turkey in 1841, where his father was working as an engineer. He was educated at the Lycee in Lyons (France) and thereafter at the National School of Mines. At the age of 19, he worked as a mining engineer, at the mining company named Compagnie de Commentry-Fourchambault-Decazeville in Commentary. He was promoted as the Manager in 1872 and Managing Director of the Company in 1888.

Fayol retired as Managing Director in 1918, having spent his entire working life with the Company, he remained Director of the Company until his death in December 1925, at the age of 84. Fayol’s efforts as the Managing Director enabled the company to rise from a position of financial disaster to that of great financial success.

Fayol was influenced by Cartesian philosophy and Adam Smith’s writings. He founded the Centre d’Etudes Administratives in France, which has profound influence on business, army and navy. At the Centre, he used to chair weekly meetings of prominent industrialists, writers, officials, academics, and members of the military. He also influenced the French Government to pay attention towards the principles of administration. He used to advise the Government and investigate into the workings of the Posts and Telegraphs, and the Tobacco Industry.

Fayol was a prolific writer on technical and scientific matters as well as on management. Apart from ten publications on mining, engineering and geology, he published as many books or papers on management. The most outstanding of his writings is his book General and Industrial Management.

His reputation, to a large extent, rests on this single short publication, which is still being frequently reprinted. A large number of his papers are concerned with the reform of the public services. His paper on The Theory of Administration of the State was presented to the Second International Congress of Administrative Sciences in 1923, which is considered a major contribution to the theory of public administration.

The Theory of Administration or Management:

Fayol emphasize on the following three elements of the theory of management. They are:

1. Administrative Theory

2. Elements of Management

3. Principles of Administration

Administrative Theory:

Fayol attempted to develop a science of administration for management. He thought that his principles would be useful to all types of managers. He truly advocated the notion that, if a manager wants to be successful, he only needs a certain set of management principles. If a manager climbed the corporate ladder and reached higher positions, would depend less on technical knowledge and more on administrative knowledge.

He emphasized the role of administrative management and concluded that all activities that occur in business organizations could be divided into six main groups. They are:

• Technical (production, manufacturing)

•  Commercial (buying, selling, exchange)

• Financial (obtaining and using capital)

• Security (protection of property and persons)

• Accounting (balance sheet, stocktaking, statistics, costing)

• Managerial (planning, organising, commanding, coordinating, controlling)

He concluded that the six groups of activities are interdependent and that it is the role of management to ensure all six activities work smoothly to achieve the goals of an enterprise.

Elements of Management:

Fayol identified, as we have seen earlier, the five elements of management i.e., planning, organising, commanding, coordinating and controlling (POCCC) which are discussed below:

Planning:

Fayol used the French term ‘Prevoyance’ which means to ‘foresee’, to ‘anticipate’ and to ‘make plans’. Planning is the most effective tool or instrument in the view of Fayol. Planning enables the separation of the short-run events from the long-range considerations. It endows forethought to the operations of an organisation. Fayol considers that experience is an asset in drawing a realistic plan. To him, unity, continuity, flexibility and precision are the broad features of a good plan of action.

Organising:

To organise an industrial firm or a government agency some material are required for its functioning, such as; raw materials, tools, capitals, personnel, etc. Fayol classifies these activities into two categories: the material organisation, and the human organisation. The latter includes personnel, leadership and organisation structure.

Commanding:

The art of command, according to Fayol, rests on certain personal qualities and knowledge of the general principles of management. Its degree of proficiency differs from unit to unit.

Coordinating:

It consists of working together and ‘harmonizing’ all activities and efforts so as to facilitate the functioning of the organisation. Essentially, the objective of coordination is to ensure that one department’s efforts are coincident with the efforts of other departments, and keeping all activities in perspective with regard to the overall aims of the organisation.

Controlling:

Its objective is to obtain conformity with the plan adopted, the instructions issued and principles established. In the process, weakness and errors have to be rectified and their recurrence prevented. For control to be effective it must be done within a reasonable time and be followed up by sanctions. He uses the term control in the wider French sense of watching, monitoring, checking, auditing and obtaining feedbacks.

Attributes of Manager:

Fayol suggests that managers should have the following attributes:

• Physical: Health, vigour and appearance.

• Mental: Ability to understand and learn, judgment, mental vigour and adaptability.

• Moral: Firmness and willingness to accept responsibility.

• General Education: General acquaintance with matters not belonging exclusively to functions performed.

• Special Knowledge: Special knowledge of the functions being handled be it technical, commercial, financial or managerial.

• Experience: Knowledge arising from the work proper.

 Principles of Administration:

Henry Fayol states that the principles of administration / management are not rigid. On the contrary, they must be capable of adaptation to various enterprises and settings.

The fourteen principles of Fayol are as follows:

1. Division of work: Specialisation of labour produces more and better work with the same effort.

2. Authority and responsibility:  Authority should be commensurate with responsibility. In other words, the occupant of each position should be given enough authority to carry out all the responsibilities assigned to him.

3. Discipline: Obedience should be observed in accordance with the standing agreements between the firm and its employees.

4. Unity of command: For any action, an employee should have only one boss.

5. Unity of direction: One head and one plan for each activity.

6. Subordination of individual interest to general interest: The interest of one employee or group should not prevail over that of the total organisation.

7. Remuneration of personnel: The remuneration paid for services rendered should be fair and afford satisfaction to both personnel and the firm.

8. Centralisation: The degree of initiative left to managers varies depending upon top managers, subordinates and business conditions.

9. Scalar chain (Hierarchy): The line of authority of superiors ranging from the ultimate authority to the lowest ranks.

10. Order (Placement): Once the basic job structure has been devised and the personnel to fill the various slots have been selected, each employee occupies that job wherein he or she can render the most effective service.

11. Equity: For the personnel to be encouraged to fulfill their duties with devotion and loyalty there must be equity based on kindness and justice in employer-employee relations.

12. Stability of tenure of personnel: Suitable conditions should be created to minimize turnover of employees.

13. Initiative: The ability to think afresh would act as a powerful motivator of human behaviour.

14. Esprit de corps: Harmony, union among the personnel of an organisation is a source of great strength in the organisation.

Fayol's Philosophy of Gangplank:

The Gangplank refers to the need for ‘level jumping’ in a hierarchical organisation. Although Fayol places emphasis on formal organisation, he is alive to the dangers of conformity to hierarchy and formalism. It is an error to depart needlessly from the line of authority, but it is even greater one to keep it when detrimental to the businesses, asserts Fayol.

Gangplank:

Gangplank

He illustrates the problem with reference to the figure given below. If ‘F’ follows the principle of proper channel of communication, he has to send his message or file to ‘P’ through ‘E’, ‘D’ and so on, covering nine levels. It is, however, possible for ‘F’ to use ‘gangplank’ and avoid going through ‘A’ and all the other intervening layers as intermediaries. Recourse to ‘gangplank’ is possible only when the immediate superiors (in the case, ‘E’ and ‘O’) authorize such a relationship. Whenever a disagreement develops between ‘F’ and ‘P’, they must turn the matter to their superiors. While suggesting ‘gangplank’, Fayol is rather cautions. He feels that it may be less relevant to Government agencies in which the lines of authority are less clear than in private organisations.

Criticism of Fayol:

Fayol’s theory has been criticized on the following grounds:

Too formal: Fayol’s theory is said to be very formal. However, in any scientific and analytical study facts and observations have to be presented in a formal manner.

Vague: Some of the concepts have not been properly defined. For example, the principle of division of work does not tell how the task should be divided. Again, to say that an organisation needs coordination is merely to state the obvious. In the words of Herbert Simon, administrative theory suffers from superficiality, oversimplification and lack of realism.

Inconsistency: Principles of administrative theory were based on personal experience and limited observations. There is too much generalised and lack of empirical evidence. They have not been verified under controlled scientific conditions. Some of them are contradictory. For example, the unity of command principle is incompatible with division of work. The theory does not provide guidance as to which principle should be given precedence over the other.

Pro-management Bias: Administrative theory does not pay adequate attention to workers. Workers are treated as biological machines or inert instruments in the work process.

Some other grounds are:

1. He neglected the structural aspect and his treatment of the organisation was considered defective.

2. Peter Drucker observes that some of the worst mistakes of organisation building have been committed by imposing a mechanistic model of an ‘ideal’ or ‘universal’ organisation on a living business.

3. The empirical base used by Fayol for generating a full-fledged theory of management is too narrow.

4. His ideas are criticised on the basis of their value judgments involving ‘should’ or ‘ought’ statements, for lack of a sufficient experimental basis and for their internal contradictions. Elaborating their criticisms, Barnard and Simon argue that a managerial organisation cannot be explained purely in terms of a set of principles about formal organisation structure.

5. Fayol has mostly ignored the social-psychological or emotional needs of the employees.