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Chapter II

Principles of Managements
(Principles Serve as a guide to thought and action)

Meaning of principles of management?

Management principles are statements of fundamental truth.All those principles which serve as guidelines for decisions and actions of managers are known as principles of management.

Nature of the Principles of Management

Principles of Management have the following features:-

1. UNIVERSAL APPLICABILITY:Management Principles are universal and these can be applied in all types of organisations, business, govt, military, hospitals etc.

2. FLEXILITY:The Principles of Management are flexible i.e. they can be changed by the managers according to the given situation. 3. CAUSE-AND- EFFECT RELATION:Management Principles establish cause and effect relationship between different factors. Principles of Management tell us as to what would be the result if a particular principle is applied in a given situation. E.g. The Principle of Unity of Command States that if there is more than one boss over an employee, confusion will occur. Here multiple commands are the cause and confusion is the effect. 4. EQUALITY:All management principles are equally important. No one principle has greater significance than the others. 5. HUMAN NATURE:Human behaviour is very complex and unpredictable. Principles of management are designed to influence human behaviour in the desired manner so that the organisational goals are achieved.

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Significance of the Principles of Management

The Significance of Principles of Principles of management can be explained as follows:1. TO INCREASE EFFICIENCY:Principles help manager to improve managerial efficiency through better decisions and actions, use of principles also simplifies the managers job and saves considerable labour and time. In the absence of principles, manager depends on trial and error method for solving problems. 2. HILIGHHT THE TRUE NATURE OF MANAGEMENT:Principles of management help in understanding the functions of management help in understanding the functions of management. Management principles provide a conceptual framework within which the manager has to work towards achieving of organisational goals. 3. FOR REDUCING WASTES: The main objective of principles of management is to reduce the waste of three Ms i.e. Men Material and Machinery. 4. HELPFULL IN MANAGEMENT TRAINING:In order to develop managerial talent it is necessary that management principles should be taught in institutes and universities. Management principles suggest the areas in which training should be given to existing and future managers. 5. DEVELOP THE SPIRIT OF CO-OPERATION:The principles of management emphasis how cooperation can be achieved from others to accomplish the organisational goals. 6. TO GUIDE RESEARCH:In the absence of principle research becomes difficult. Increasing popularity of the principles of management is because of their usefulness. This has attracted a large number of people towards their study and future research in management.
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Henry Fayols 14 Principles of Management: Henry fayol was a French Management theorist. At the age of 19 he, he started working as an engineer in a mining company and later on became the M.D. of the company. Through his long experience, Fayol developed a general theory of management. He published a book under the title of General and industrial Management. Fayol laid down 14 Principles of Management in this book, thats why he is popularly known as Father of General Management.

Following are the fourteen principles of management suggested by Henry Fayol:

1) DIVISION OF WORK:Division of work means subdividing a work and distributing different tasks to different persons so that a person performs only one type of work. Division of work helps to avoid waste of time caused by change from one work process to another. 2) AUTHORITY AND RESPONSIBILITY:Authority means the right to give order and obtain obedience and responsibility means obligation to carry out an assigned job or work. According to this principle there must be balance between authority and responsibility, both authority and responsibility must go together because if a person is given some responsibility without authority, hell become ineffective.

3) DISCIPLINE:-

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In management, discipline means to respect authority and obey the rules and regulations of the organisation. Discipline is essential for the smooth working of all organisations. It is required not only on the part of workers but also on the part of organisations. 4) UNITY OF COMMAND:According to this principle, subordinates should receive order from and be accountable to one and only one superior or boss. If any employ receives orders from more than one boss, there is likely to be confusion and conflict but this principle helps to avoids confusion and conflict among workers. 5) UNITY OF DIRECTION:This principle suggests that there should be one head and one plan for a group of activities having the same objective. In other words the related activities should be put under one group, there should be one plan of action for them and they should be under the control of one particular manager. 6) SUBORDINATION OF INDIVIDUAL INTEREST TO GENERAL INTEREST:This principle suggests that organisational interest or goals should be given more priority as compared to individual goals or interest of an employee. An organisation has its own objectives while an individual worker has his own individual objective for working in a company. So for the attainment of organisational goals, employees must give up carelessness, selfishness and their personal interests.

7) REMUNERATION OF EMPLOYEES:Facebook.com/intensivedreamer

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According to this principle, the remuneration payable to the employees should be fair, reasonable and rewarding of efforts. They should be satisfactory to both employers and employee. To be fair, wages should be determined on the basis of work assigned, cost of living, liquidity of enterprise etc. 8) CENTRALISATION AND DECENTRALISATION:Centralisation means when decision making power is in the hands of top level management. Decentralisation means sharing of authority with lower levels of management. According to this principle a company must be properly balanced i.e. it should neither be completely centralised nor decentralised. Hence depending upon the size of organisation, ability of the subordinates etc there must be some element of centralisation and decentralisation in every organisation. 9) SCALAR CHAIN:The principle of scalar chain suggests that there should be clear line of authority from top to bottom, linking superiors and subordinates at all levels. The scalar chain serves as a chain of command as well as communication. Fayol suggested that in normal course, chain of command should be strictly followed; while in case of emergency employees can communicate directly with each other. GANG PLANK: - Gang plank is a shorter route which allows two employees at the same level to communicate directly with each other. The direct communication between two employees at the same level is known as gang plank. A B E

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C D

F G

Gang plank 10) ORDER:According to this principle in an organisation there should be a suitable place for everything and everyone must be at right place. The principle of order is concerned with proper arrangement of things and placement of people. The order can be of following types:a) Material order: - Arrangement of material tools and equipments is called material order. b) Social order: - Arrangement of people at proper and fixed place is called Social order. 11) EQUITY:This principle suggests that manager should be kind and fair towards their workers. All workers should be treated alike and there should be no discrimination on the basis of sex, religion, caste etc. All the employees should be treated equally. 12) STABILITY OF PERSONNEL:The principle suggests that the period of service in a position should be fixed and employees should not be moved from their positions frequently. An employee cannot render useful service if he is removed before he gets familiar to the work assigned to him. 13) INITIATIVE:Initiative means eagerness to do something without being asked to do so, however, it does not mean freedom to do whatever people like.
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They must maintain discipline. The principle states that employees should be given freedom to some extent so that they can come forward and use their skills to achieve expected results. 14) ESPIRIT DE CORPS:It means team spirit in group efforts and mutual understanding among employees. When there is team spirit everyone comes forward to help others. To promote team spirit the feeling of i should be replaced with we in the minds of managers while communicating with workers. This principle helps to develop atmosphere of mutual trust and understanding.

Meaning of Scientific Management

Scientific management refers to the use of scientific methods and techniques in place of old rule of thumb or trial and error approach in solving management problems. It aims at improving the efficiency of workers and the quality of products. According to F.W. Taylor Scientific management means knowing exactly what you want men to do and seeing that they do it in the best and cheapest way.

Principles of Scientific Management

Following are the principles of scientific management given by F.W. Taylor :-

1. SCIENCE, NOT RULE OF THUMB:The principle is concerned with selecting the best way of performing a job through the application of scientific analysis and not by applying hit and trial method. The work assigned to an employee should be observed and analyzed with respect to each element or part thereof and the time involved therein so as to decide the best way of performing that work.
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2. SCIENTIFIC SELECTION, TRAINING DEVELOPMENT OF WORKMEN:This principle requires that workers should be selected and trained in accordance with the requirements of the job to be provided to them. The physical, mental and other requirements should be specified for each job, and workers should be selected and trained to make them fit for the job

3. HORMONY, NOT DISCARD:This principle suggests that there should be complete harmony between the workers and the management, since if there is any conflict between the two, itll not be beneficial either for the workers and for the management. The principle requires that there should be perfect understanding between the management and workers and both should feel that they all are part of same family.

4. MENTAL REVOLUTION:Mental revolution means complete change in the outlook of both management and workers towards each other. Mental revolution requires that management should create suitable working conditions and provide an opportunity to workers for development and to provide them chance of participation in decision-making and in surplus of industry. In short mental revolution requires that there should be a spirit of togetherness between workers and management.

5. CO-OPERATION, NOT INDIVIDUALISM:This principle lays stress on mutual co-operation between workers and the management. This principle also suggests that there should be mutual confidence, sense of goodwill present among both, managers as well as workers. Management should always welcome the suggestions of workers and should also reward them on their beneficial suggestions. At the same time workers should also resist from going on strike and making unnecessary demands from management. Thus Taylor suggested that there should be proper division of work and responsibility between the two.

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Techniques of Scientific Management

To put scientific management into practice, Taylor laid down the following techniques of scientific management. 1. WORK STUDY: Work study means critical assessment of the performance of workers in various operations in a workshop to set the standard time for performing a specific job efficiently. Work study have following aspects: a) TIME STUDY: Time study determines the standard time taken by a workman to perform a given task. Time study is helpful in deciding the time required normally to perform a given job. It also helps in determining a fair days work for the workman. b) MOTION STUDY: Motion study means close observation of the moments of a workers body involved in performing a job. The purpose of motion study is to avoid wasteful motions and determine the best way of doing a job.

c) METHOD STUDY: There are various methods for completing any job. The aim of method study is to maximise efficiency in the use of material machinery, manpower and money by improving work methods. Methods should be decided on the basis of trying all methods, and the method that gives

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the best result with minimum cost must be selected for performing a job. d) FATIGUE STUDY: Fatigue study seeks to find out how long a person can perform the standard task without any adverse affect on his health and efficiency. Industrial fatigue arises when a person keeps on working without rest, pauses for a long time. Physical and mental fatigue affects the health and efficiency of workers. Thus fatigue study helps to determine the amount and frequency of rest intervals in completing a job. 2. DIFFERENTIAL PIECE-RATE SYSTEM: Under the system Taylor suggest that wages must be paid to employees on the basis of the work done. Taylor has suggested two types of wages for similar work. Higher wages for efficient workers and lower wages for inefficient workers. Workers who perform above or up to the standards set for them must get higher wages and workers who perform below the standards must get lower rate of wages. 3. FUNCTIONAL FOREMANSHIP: A foreman belongs to operational management and is the highest ranking worker. In this technique, Taylor suggested separation of planning and execution function. According to him, foreman should be intelligent, educated, and tactful and should possess special knowledge and good health. Since it is very difficult to find all these qualities in a single person. Therefore, Taylor suggested that every worker should be supervised by different experts in different phases of his job. He advocated the appointment of eight foremen, four of them (in office) being responsible for planning the work and the other four 9in the shop) concerned with execution of work. To improve the quality of supervision of workers at the operational level, Taylor suggests us the duties of foreman in the following ways: a) PLANNING INCHARGE: The main functions ofplanning in charge is to plan all aspects of a job to be performed, it consists of four positions: i). Route clerk: - The route clerk lays down the path that each operations is
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to follow, for completion of a particular job. ii). Time and cost clerk: - Time and cost clerk fixes the time for starting and completing the work and prepares the cost sheet for each job. iii). Disciplinarian: - He enforces rules and regulations and maintains discipline. iv). Instruction card clerk: - The main function of instruction card clerk is to frame the instructions according to which workers have to perform their jobs. b) PRODUCTION INCHARGE: The main functions of production in- charge are to get the work done according to plans. It consists of following four persons: i). Gang boss: - He is responsible for keeping machines and tools etc ready for operation so that there is no delay. ii). Speed boss: - He is responsible for timely and accurate completion of job. He checks whether work is progressing in accordance with the plans and standards. iii). Repairs boss:- his job is to ensure that each worker keeps his machine clean and free from rust, and he oils and treats the machine properly. iv). Inspector: - He ensures that work is done as per the standards of quality laid down by the planning department.

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Frederick Winslow Taylor (1856-1915) is the father of Scientific Management.

4. STANDARDIZATION AND SIMPLIFICATION OF WORK:a) STANDARDIZATION:It is the process of setting standards for different tasks. Standards can be set for products, materials, equipments, work methods and working conditions. Standardization of products implies that size, design, weight, shape, quality etc of the products should be such that it meets the requirements of customers. Standardization helps to reduce spoilage and wastage of resources, improves the quality of work, reduces cost of production and reduces human fatigue. b) SIMPLIFACATION: - (unwanted size, products) It means optimum utilisation of resources i.e. men, machine and material without stoppages and breaks of machines. It helps in reducing the cost of labour, machines and tools.

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