CLASSICAL THEORY

OF
MANAGEMENT
By- Sweety Gupta
 Classical Management Theory

 Henry Fayol Theory

Taylor theory (Scientific

management Theory)
Fayol’s Principles
Of
Management
 Henry Fayol Theory

Made clear distinction between technical and

managerial work.

Identified the main steps in the process of

management (planning, Organizing, Staffing,
Directing and Controlling).

Developed fourteen principles of management which

act as a guidelines for managers for managerial
work.
 Principles Of Management
Principles

 Division of work
 Authority and Responsibility
 Discipline
 Unity Of command
 Unity of direction
 Remuneration of persons
 Centralization and
Decentralization
 Scalar chain
 Order
 Equity
 Stability of tenure of personnel
 Initiative
 Esprit De Corps
 Principle Of Division Of Work

Whole work must be divided into small tasks or units

of work.
Technical, Managerial and Skilled jobs should also
be divided into small segments.
Increases the specialization of an employee.
Improves efficiency of employees by performing only
one part of the job.
 Principle Of Authority And
Responsibility
Authority means power to take decision

Responsibility means obligation to complete the

assign job on time

When some responsibility is given to a person, the

matching authority should also be given.

Excess authority may lead to negative results.

 Priciple Of Discipline

Discipline refers to general rules and regulations of

an organization.
It also mean developing commitment in the
employees towards organization and towards each
other.
Discipline is required at every level of organization,
not only at a subordinate level.
 Principle Of Unity Of Command

Employee should take order from only one boss.

No confusion in the mind of a subordinate.

No ego clashes.

Improves effectiveness in working

 Principle Of Unity Of Direction

‘One unit one plan’.

Everyone should work in harmony to achieving

common goal of the organisation.

No wastage of resources and efforts of employees

Subordination Of Individual Interest To
General Interest
Interest of the organization must supersede the
interest of individuals

All employees should work towards the interest of an

organization

Employees should know that their growth depends

upon the company’s growth.
Principle Of Remuneration Of Persons

Employees must be paid fairly and adequately to

give them maximum satisfaction

Remuneration must be just and fair.

Employees get motivated.

Devotion and commitment of employee improve.

 Principle Of Centralization And
Decentralization
Centralization means concentration on authority and
power with top level.
Decentralization means evenly distribution of power
at every level
There must be a combination of both in an
organization
Fast decision at operational level and strict control
by top level.
 Principle Of Scalar Chain

Scalar chain means ‘Line Of authority’ from highest

to lowest rank.

 Everyone in the organisation must follow the rules

of scalar chain.

But in case of emergency, a short cut can be taken,

known as ‘Gang-Plank’.
 Principle Of Order

Orderly arrangement of men and material, i.e., a

fixed place for everything and everyone in an
organization.
No wastage of time in search of men and material.
Smooth and systematic working of organization.
 Principle Of Equity

Fair and just treatment to employees.

No bias in dealing with employees

Gives maximum satisfaction to employees.

Motivate employees and boost up the moral of

employees.
 Principle Of Initiative

Employees must get an opportunity to take some

initiative in making and executing plans.
Gives immense satisfaction among employees.
Managers must welcome the suggestions and ideas
of employees before making a plan.
Develops feeling of belongingness in employees.
 Principle Of Esprit De Corps

Means union is strength.

Develop Team spirit

Every employee must work as a part of team

Managers must develop a feeling of belongingness

among employees
 Stability Of Tenure Of Personnel

No frequent Termination or Transfer

Must provide job security among employees.

No wastage of time and resourses.

Frequent turnover of employees is bad for

organization.
 Taylor’s Theory

 Taylor theory was introduced in 1911

He introduced scientific management principles

replacing the rule of thumb

He simply applied scientific tools and methods to

solve management problems
 SCIENTIFIC TECHNIQUES

Techniques

 Functional foremanship
 Standardization and simplification of work
 Fatigue study
 Method study
 Time study
 Motion study
 Differential Piece wage system
 Mental Revolution
 Scientific
Techniques
of
Taylor
 Functional Foremanship

He advocated that specialisation must be introduced

in a factory.

Division of factory in two department: Planning

department and Production department

Experts in every department to guide the workers

 Standardization And Simplification Of
Work
Standardization means maintaining standard among
size, type, weight, measure and quality of the
product.

Simplification means eliminating unnecessary

diversity of product, size and types.
Advantages of STANDARDISATION
It is economical to have standardised material, tools
and equipments.
Operators can be trained easily.
Helps in achieving economies of large scale
production.
Reduce cost of production.
 Fatigue Study

Fatigue is generally caused by long working hours.

It emphasis on:
 The Frequency of rest intervals
 The duration of rest intervals
 The no. of rest intervals

This study aims at providing proper rest interval to

the employees to increase the effectiveness of the
work.
 Method Study

Find one best method of performing the job which

maximizes the profit.

All methods should be tried first and then the best

should be selected.
 Time Study

The Standard time required to perform a job.

Setting up standard target for workers.

Determining the number of workers required to

perform a job.

Categorizing the workers in efficient and inefficient

categories.
 Motion Study

Observe an average worker when he is performing a

job by determining his movements.

Differentiate between productive and unproductive

movements.

Cut down all unproductive and wasteful movements.

 Differential Piece Wage System

Paying different rate of wage to efficient and

inefficient employees.

Extra wages paid to efficient employees will motivate

both efficient and inefficient employees.

When payment given acc. to no. of units produced, it

will automatically maximize the production.
 Mental Revolution

Change in mental attitude of workers and

management towards each other.

Co-operation between worker and employees.

Develop positive thinking among each other.