Unit 2

Principles of management

Concept of Scientific Management

The Scientific Management Theory is well known for its

application of engineering science at the production floor or the
operating levels. The major contributor of this theory is Fredrick
Winslow Taylor, and that’s why the scientific management is
often called as “Taylorism”. It is an attitude and philosophy
that discard the traditional method of hit and miss, trial and error
and rule of thumb of managing work and workers. It is
concerned with development and application of scientific
problem solving approach that includes research, investigation,
experiment, data collection analysis and formulation of certain
principles to solve organizational problems. It is mainly lower
level management analysis which concentrates on the one best
way to perform a task. This approach focuses, there must be
cleared and well recognized procedures and vision for
completion of work. The basic purpose of scientific
management is to improve lobour productivity.

According to Frederick Winslow Taylor, “ Scientific

management means knowing exactly what you want men to do
and seeing that they do in the best and cheapest way.

Frederick Winslow Taylor (1856- 1915), who is known as father

of scientific management, was one of the prominent scholars to
introduce scientific system of management. He started his
carrier as machinist in Midvale steel company in Philadelphia,
USA in 1878 where he worked as a machine shop worker
for two years as gang boss for some years and as chief
engineer at the age of 28.he also joined Bethlehem steel
company where he served for a long time. Later he
devoted his time to develop the concept of scientific
management.
He noticed that there were much disorder and wastage of
human as well as other resources at work place. The
managers and staffs had no concept about systematic and
efficient performance of task. And all were following
traditional ways of doing work. So he tried to remove these
problems through the development of new concept. Thus
the scientific management concept was developed. He also
noticed that employees were deliberately working at slower
pace than their capacity which he called soldiering. He invented
high speed steel cutting tools and spent most of his time as
consulting engineer. He implement piece rate payment system.
Taylor’s philosophies and ideas was given in his book “ Principle
of scientific management” published in 1911.
Characteristics / Features of Scientific Management
The main characteristics or features of scientific
management are listed below:
Approach: Scientific management is a systematic,
analytical and objective approach to management which
makes sure that all activities are carried out a systematic
and scientific manner.
Minimize Wastage: The focus of scientific management is
to cut down the waste of time, materials, machine, etc. All
of the avoidable components of production are removed
and a genuine attempt is made to attain highest
production at the minimum cost.
Discards Traditional Management: The scientific
management approach completely discards the old ways
of rule of thumb and hit or miss strategy. It demands the
usage of new and modern methods.
Mental Revolution: Scientific management brings a
complete change in the mental attitude of employees
along with the management. The aim is superior
production targets as opposed to just chasing higher
profits.
Demands Rigorous Observance of Rules: Scientific
management calls for very strict observance of rules, as
the rules are created only after due investigation and there
is hardly any possibility of error in them. Unless the
guidelines are implemented stringently the scientific touch
given to management may disappear which makes it just
like the traditional management.
Emphasis: It concentrates on all factors of production,
men, material and technology.
Increases the Productivity of Employees: The key
purpose of scientific management is to boost the
performance of employees. This is successfully achieved
by performing a variety of studies like time study, motion
study and fatigue study. As a result, scientific
management helps in the enhancement of employees
efficiency and the gain eventually goes to the organization
itself.
According to Taylor, Scientific Management implies the
application of two fold techniques. They are
1. Scientific Method
2. Management Specialist
Scientific Method
It is the discovery of the best method of performing a
particular work under the existing conditions of
knowledge and organizing ability. It involves observation,
experiment, measurement and interference to achieve
goals in defined time.
a) Observation: It is concerned with making study and
investigation about the development of work
according to plan. This is essential to develop feeling
of responsibility among the workers to complete their
work and no one can avoid their duty.
b)Measurement: It is concerned with comparison of
actual achievement of work with that of planned
performance. This is essential to take right decisions
at right time .
c) Experiment: It is concerned with experiment and
research to solve the problems in different situations.
It is essential to make management system up-to-date
and adaptable with changing environment.
d)Interference: It is concerned with controlling and
providing suggestion and guide lines to the
subordinates. This is essential to know about the
 progress of the work and take necessary steps if any
limitations or problems is there in work.
Management Specialization
The management specialist can be defined as one who
specializes in the application of modern scientific
method to the solution of the problem. It implies the
existence of a specific body of knowledge and orderly
discipline to solve any problem.

The principles of Scientific Management by Taylor

1. Science, not a rule of thumb: 

The first principle of the scientific management
aims to replace the traditional rule of thumb
approach in management. Rule of thumb means
general assumptions or rules that are made on the
basis of past experiences or practice. So this
principle suggests there must be scientific analysis
and study of any job and only after the
investigation, an action should be conducted.

2. Harmony, not discord:

This principle requires that there should be perfect
understanding between the management and workers and
both should feel that they are part of same family. Both the
management and the workers should realize the
importance of each other. If there is any conflict between
the two, it will not be beneficial either for the workers or
the management. t becomes possible by (a) sharing a part
of surplus with workers (b) training of employees, (c)
division of work (d) team spirit (e) positive attitude (f)
sense of discipline (g) sincerity etc.

3. Co-operation, not individualism: 

According to this principle, there should be a
feeling of co-operation between the manager and
the labor. If there will be a feeling of personal
interest then the organizational goals cannot be
obtained hence both manager and the employee
should focus on the organizational goals. So there
needs to be a mental revolution in both the mind
of the employee and the employer. The employer
must provide a suitable environment for the
employee to work and the employee must focus on
the greater goal.

4. Maximum output: 
According to this principle, a business organization
must always be focused towards maximizing the
profit and productivity. There should be an
optimum utilization of resources and maximum
effort by the manpower to generate the maximum
output for the organization.
5. Division of responsibility: 
This principle divides the role of planning and
executing among the employer and the employee.
The employer should be given the role of only
planning and the employee should focus on only
operating to execute the plans. By this there will be
no confusion regarding their roles and there will be
a smooth operation of action.

6. Development of employees: 
According to Taylor, there must be a scientific
selection of human resources and once they are
selected they must be trained and developed in
such a way that they can work to their maximum
capacity for the organization. The success of the
organization depends on the efforts of the most
competent employees. So they must be trained
and groomed providing essential facilities and
growth.

7. Mental revolution of both management and

workers:

According to Taylor, there must be mental

revolution on part of management and workers. It
is realized that no plan of management will
 succeed unless there is feeling that they have to
work hard. Thus, it is essential to maintain best
friendship and firm relation between both parts.
This is possible through mental revolution and
development of attitude of hospitality and co-
ordination towards each other.

Hence these are the basic principles of Taylor’s

scientific management which focus on maximum

output by efficient use of the resources. The major

contribution of Taylor’s Scientific Management is its

focus on the scientific approach to management and

high increase in efficiency and productivity.

Limitations of Taylors’s Scientific Management

There are many merits of Scientific Management such

as improvement of efficiency for maximum output,

development of skills of employees and improving the

productivity. But there are some criticisms by

employers, workers, and experts which cannot be

overlooked. Some of the limitations of Taylor’s Scientific

Management are:

1. Focus only on Employees: 

Taylor’s scientific management gives too much
emphasis to the workers. It does not address other
problems that might come up in an organization. In
a way, it is also criticized that it exploits the workers
and there is no wage rise system along with a rise
in the productivity.

2. No best way: 
Taylor’s scientific management tries to find the best
solution to run an organization but in practice,
there is no one best way to run an organization.
There are many employees of different
background and perspectives. So all cannot be
treated in the same way. So there cannot be one
best approach in management.
 3. Monotonous and Frustration: 
In Taylor’s scientific Management a worker has to
do a certain job to the best capacity. So there is a
specialization of the job. But there is monotonous
and dullness which can cause mental fatigue. Due
to lack of creativity and originality, employees
might face frustration.

4. Ignores Human Factor: 

Workers are just taken as economic tools by the
scientific management of FW Taylor. The Principle
believes that employees are only motivated by
money. But this is not true in all the cases. Human
beings are motivated by other factors as well such
as human dignity, moral values, respect, and care
etc. So the Scientific Management of Taylor
neglects the human side of Labor.

5. Requires huge capital:

The theory requires an investment of huge capital and is

considered as a costly system. The establishment of work
study, planning department, training of workers, and
standardization requires more money.

6. Overly bureaucratic:
Over bureaucratic activity may be a major disadvantage in
any organization. A bureaucratic and strict
organization may make the employees feel dissatisfied
and this may lead to high staff turnover rates and may
affect productivity. New staffs must be trained in order to
adapt to new changes in the sector which leads to wastage
of productivity time.

7.Mechanistic:

The theory follows a specific approach for organizations

and the employers gain control over the workers. This
activity makes work mechanistic and treats the workers
like machines. The theory focuses on efficiency, where
workers were viewed as robots to speed up work. The
workers lose skill level and autonomy work level; they
aren’t beneficial for state of the art working conditions.

8. Not suitable for teams:

Scientific management theory doesn’t work fruitful for

teams and groups as they have the capability to abuse and
exploit human beings which may lead to conflicts. There is
no scope for individual preference with this theory.
Functional foremanship was followed by Taylor, where
the workers were required to report to eight bosses. By
this way, the unity of command was broken, where the
worker needs to report to just one boss. When there is no
unity of command, there is confusion and disorder in the
organization.

9. Avoids bargaining:

Since the scientific approach follows piece work pay

system, there is not chance for any realistic bargaining
regarding the wage rates, as the tasks are timed, measured
and rated scientifically.

10. Unemployment:

With the application of this theory, men are replaced by

machines which in turn lead to unemployment. By this
way, fewer employees are required and many are chucked
out from work.2

11.Adverse effects:

The scientific management theory pushes workers to rush

to complete their work and complete work within
stipulated time. By this way there is adverse effect on the
health of the workers.

12. Time consuming:

The scientific management theory is considered time

consuming as it requires complete reorganizing and
mental revision of the organization. The theory when
adopted needs more time for standardization, study and
specialization, or else at time of overhauling, the workers
suffer.

Contributions of F.W Taylor

While working in Midvale Company as a manager Taylor
observed that employees were not performing as per their
capacity of productivity. And he considered that this
condition was occurring because of no care towards the
waste. Taylor worked towards the experiments at his work
place to increase the worker’s efficiency so that maximum
output could be achieved by utilizing effort at maximum
level.
1.   Scientific task setting:- Taylor observed that the
management does not know exactly the works – pieces of
work- volume of works- which are to be performed by the
workers during a fixed period of time- which is called
working day. In a working day how much work is to be
done by a worker but be fixed by a manager and the task
should be set everyday. The process of task setting
requires scientific technique. To make a worker do a
quantity of work in a working day is called scientific task
setting . Its various aspects are:
(A) Method study
(B) Motion study
(C) Time study
(D) Fatigue study
A. Method Study:
There are various methods for completing any job. This
technique is to find out the best way or at least one of the
best methods of doing a particular job in order to
minimize the cost of production and maximize the quality
and satisfaction of the customer.
B. Motion Study:
Motion study refers to the study of various movements,
like sitting, standing, holding, turning, changing position
etc., of workers, while performing a particular job. The
main objective of this study is to identify the motions
which are productive, incidental and unproductive. This
study helps in eliminating the unnecessary movements as
to complete a given task in less time thereby increasing the
efficiency.
C. Time Study:
Time study determines the standard time taken by a
workman to perform a given task. The standard time is
fixed by taking several readings of a specific task. Its
purpose is to decide how much time is normally required
by the workers to perform a certain job and thus to
determine the number of workers to be employed for a fair
day’s work.
D. Fatigue Study:
It is human tendency that a person feels physically and
mentally tired if she/ he is made to work continuously
without any rest. The rest period enables one to regain the
stamina and to work again with same capacity.Fatigue
study intends to find out the number and frequency of rest
intervals that must be provided to a worker in completing
a job efficiently.
1. Differential Piece Wage System:
Differential piece rate system is a system of wages’
payment in which efficient and inefficient workers are paid
at different rates. Taylor has suggested two types of wages
for similar work. Higher wages for efficient workers &
lower wages for inefficient workers. Taylor classified the
workers as efficient or inefficient on the basis of their
performance.
Workers who perform up to or above the standards set for
them are regarded as ‘efficient’. On the other hand,
‘inefficient’ workers are ones who perform below the
standard. Accordingly, a worker producing equal to or
more than the fair day’s work is considered as efficient
worker and is paid at a higher rate and worker producing
less than the fair day’s work is considered as inefficient
worker and is paid at a lower rate.
For example, Narmada Ltd. gives Rs. 2 per piece if in one
day 25 or more units are produced and Rs. 1.50 per unit if
in one day less than 25 units are produced. A worker who
is producing 24 units will get Rs.36 (24×1.50) whereas a
worker producing 25 units will get Rs. 50 (25×2). So he
will be motivated to produce at least 25 units because
failure to meet target by just one unit will result in loss of
Rs. 14 for him.
 2. Reorganization of supervision:- concepts of
separation of planning and doing and functional
foremanship were developed. Taylor opines that the
workers should only emphasize in planning or in
doing. There should be 8 foreman in which 4 are for
planning and 4for doing. For planning they were route
clerk, instruction cord clerk, time and cost clerk and
disciplinarian. And for doing they were speed boss,
gang boss, repair boss and inspector.
A. Planning Incharge:
The main function of ‘Planning Incharge’ is to plan all
aspects of a job to be performe:
It consists of four positions:
(i) Instruction Card Clerk:
The main function of instruction card clerk is to draft the
instructions according to which workers have to perform
their jobs.
(ii) Route Clerk
The route clerk specifies route of production i.e. sequence
to perform various mechanical and manual operations. He
also decides the job to be done for the day & where it is to
be done.
(iii) 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.
(iv) Disciplinarian:
He is responsible to ensure discipline in the work place.
He is concerned with the coordination in each job from
planning to successful execution. He enforces rules and
regulations and maintains discipline.
B. Production Incharge:
The main function of ‘Production Incharge’ is to get the
work executed as per plans.
It consists of four positions:
(i) Speed Boss:
He is responsible for timely and accurate completion of
job. He checks whether work is progressing as per
schedule.
(ii) Gang Boss:
Gang Boss is responsible for keeping machines and tools
etc. ready for operation by workers so that there is no
delay.
(iii) Repairs Boss:
Repair Boss ensures proper working conditions of
machines and tools.
(iv) Inspector:
He ensures that the work is done as per the standards of
quality of work set out by planning department.
4.   Scientific recruiting and training:-staffs and workers
should be selected and employed on scientific basis.
Management should develop and train every workers by
providing proper knowledge and training to increase their
skills and make them effective
5.  Economy:- efficient cost accounting system should be
followed to control cost which can minimize the wastages
and thoroughly reduced and thus eliminated.
6.     Mental revolution:- Taylor argued that both
management and workers should try to understand each
other instead of quarreling for profits and benefits which
would increase production, profit and benefits.

Fayol’s Administrative Management Theory

Through his rich experience, Fayol provided 14

principles of general management to guide the

managers who in his time didn’t use a scientific

approach of management. His theory is based on how

the management should interact with the employees.

Fayol’s theory provided a broad and analytical

framework of the process of administration which

overcomes the drawback of Taylor’s management

theory.Henri Fayol (1841-1925) was a French mining

engineer, managing director and an industrialist who is

known for his contribution towards management

science in his work ”Administration Industrielle

Generale" in the year 1916 A.D. The book was later

translated as “General and Industrial Management” in

the year 1929 A.D.

Fayol’s theory which is still considered applicable and

reliable is used in managing the personnel in any

organization. Fayol’s Administrative management can

be understood by the following four section:

 Division of Industrial Activities

H. Fayol observed the organization from a manager’s

point of view. So he identified six major activities in

which industrial activities can be divided. They are:

 Technical activities: This activity is related to the

production or manufacturing of goods and
services.

 Commercial activities: This activity is concerned

with the marketing dealing with sales, purchase,
and distribution of goods and services.

 Financial activities: This activity is related to the

creation of necessary capital and its optimum use
for development and growth.

 Accounting activities: This activity is related to the

recording of transactions and then preparing the
 financial statements.

 Managerial activities: This activity is considered

with the elements of management which are
planning, organizing, commanding, coordinating
and controlling.

 Security activities: This activity is related to the

protection of people and property in an
organization by providing safe working condition,
insurance policies etc.

Principles of Administrative Management

The 14 principles of management given by H. Fayol are

particularly focused on the five management function

of an organization. These are the basic guidelines to a

management of the organization as a whole.

Fayol suggests that these principles are not rigid but

they are flexible and should be used according to the

need. So it depends on the art of the manager on how

they use the above to suit the organization and to

manage effectively and efficiently. The 14 guiding

principles by H. Fayol are:

 Division of work:

This principle implies that the overall action of

management should be divided into different groups

on the basis of their common nature such as

production, marketing, finance etc.Employees should

be allocated certain jobs viewing their interest and

skills. This principle helps in specialization and helps to

make the workers more effective and efficient. Division

of work is important in technical level as well as

managerial level in an organization for smooth

operation.

 Authority and Responsibility:

Authority is the right to give the command and make

decisions. Responsibility is the obligation of an

employee to perform a certain designated task and be

accountable to the supervisor. There should be a

balance between authority and responsibility. An

employee must be given the amount of authority

required to perform the given responsibility. Authority

without responsibility will lead to waste of position and

lack of utilization of power and responsibility without

power will lead to poor utilization of human and

another resource.

 Discipline:

An employee should be obedient and respectful to the

authority and the established rules and regulation of

the organization. Clarity of Rules, Reward-Punishment

system, good supervision etc. are some ways to

maintain discipline. But it depends on the need and

policies of the organization on how to maintain

discipline.

 Unity of Command:

An employee must get orders from only one immediate

supervisor. And the employee should be accountable to

the immediate supervisor only. There should not be

other supervisors to guide the employee. This will help

to clear the confusion and will make the employee loyal

to the activity.

 Unity of Direction:

According to this principle, there should be only one

manager under the guidance and plan of which the

groups having same goals and objectives should move

forward. This principle suggests that one department,

section, the division should only get instruction from

one head. This helps in coordinating the group activity

to attain a single goal.

  Subordination of individual interest to general
interest:

There are two types of interests. One is interest of the

individuals and the other is organizational interest. So

this principle suggests that there must be harmony

between these two interests. Organizational interest

must be given more priority as doing good for the

organization will bring rewards for the individuals.

 Remuneration of Personnel:

There must be monetary as well as non-monetary

remuneration to the employees based on their

performance level. Fayol focuses more on non-

monetary remuneration in which he believes will create

bonding between the employee and the organization.

So the remuneration must be fair, reasonable and

satisfactory.

 Centralization:

This principle implies that the top most level of

authority should be centralized to the top level

management. There should be delegation of power to

the subordinate but the power to make the important

decisions in the organization should remain with the

top level management. According to fayol, there must

be the provision of centralization and decentralization

of authority on the basis nature of work and size of

organization. Generally in small organization where the

range of activities is limited may maintain

centralization. Similarly, in large organizations, having

mass acivities should maintain decentralization.

 Scalar Chain:

There should be a chain of superiors ranging from the

top level of management to the lower level

management based on the hierarchy level. The head of

an organization is in the top of the chain. The

communication flows from the top to the bottom

through this chain of authority of superiors. However,

there is no hard and fast rule regarding the process of

communication through scalar chain.

 Order:
This principle states for the systematic arrangement of

organizational resources. Fayol has classified order into

two types: material order and social order.Material

order means placement of material, machines and

other physical resources in proper place and quantity.

Similarly social order mean placement of right man for

the right job.It is essential for the smooth running of an

organization.It helps to minimizes wastages.

Equity:

This principle implies that all the members of the

organization should be treated equally. There should

be no biases and there should be an environment of

kindness and justice. As a father figure of organizations,

manager needs to behave equally to all members. The

practice of favoritism and partiality must be avoided.

This help to make all employees loyal and devoted to

the organizations.

 Stability of tenure:

This principle concentrates with job security and long

term functioning of employees.Any employee can work

to the fullest if they have secured job. So an employee

must be provided with job security which will help them

to be efficient. This will also benefit the organization as

it lowers the labor turnover and reduces cost of

recruiting and training new employees.

 Initiative:
Initiative is the level of freedom that an organization

should provide to the employee to carry out the plans

without forcing them or ordering them. This initiative

principle of management provides the sense of self

motivation among the workers and makes the more

dedicated and loyal towards the organization.

 Esprit de Corps:

This principle implies that “union is strength” and team

spirit. So the organization must integrate all its actions

towards a single goal and objective. If the action is not

unified then they cannot achieve their desired

objectives. So there must be unified team contribution

in harmony and cooperation which is always greater

than the aggregate of individual performances.

Hence these are the 14 principles of Administrative

management theory. These principles have helped in

making the management more efficient and helped

managers to develop necessary skills. But the principle

has also been criticized as not being applicable in all

situations.

Bureaucratic theory
Max Weber a German sociologist propounded the theory
called principle of bureaucracy – a theory related to
authority structure and relations in the 19thcentury.
According to him, bureaucracy is the formal system of
organization and administration designed to ensure
efficiency and effectiveness. He suggested an ideal model
for management as bureaucratic approach. He, in the
book the theory of social and economic organizations,
explained the basic principles of bureaucracy. He gave
emphasis on division of labor, hierarchy, detailed rules
and impersonal relations.

According to Rick W. Griffin: “Bureaucracy is a model of

organization design based on a legitimate and formal
system of authority”

Principles of  bureaucratic theory

1)   Job specialization: – Jobs are divided into simple,

routine and fixed category based on competence and

functional specialization. The organizations can be

divided into many departments and units based on

their function. These departments are led by experts

and specialists. So there is a high degree of job

specialization in the employees and the management.

This will help the organization to achieve high efficiency

in their operation.
2)    Authority hierarchy: – There must be a well-
defined hierarchy of authority with clear lines of
authority and control concentrated at the top. Each
level of management should be controlled by the level
of management above it in the hierarchy and they
should control the lower management below them.
This will help the organization to proceed in a single
direction.
3)    Formal selection: – All organizational members are
to be selected on the basis of technical qualifications and
competence demonstrated by training, education or formal
examination.

4)    Formal rules and regulations: – This principle of

bureaucracy management implies the need of strict
rules and regulations to be followed by the various level
of management in an organization. By this principle,
the company can maintain a level of discipline to keep
the labors in check and to bring the best out of them.
This helps in execution of the decisions in the most
suitable manner.
5)  Impersonality: – Rules and controls are applied
uniformly, avoiding involvement with personalities and
preferences of employees. Nepotism and favoritism are
not preferred. Official views are free from any
personal involvement, emotions and feelings.
Decisions are solely made on the basis of rational
factors, rather than personal factors.
6)      Career orientation: – Career building opportunity is
offered highly. Life long employment and adequate
protection of individuals against arbitrary dismissal is
guaranteed. Here managers are professional officials
rather than owners units they manage. They work for a
fixed salaries and pursue their career within the
organization.

7) Systematic filling:

In a bureaucracy system, there is written recorded

documents of each and every operation and activity of

the organization. These written documents are the

permanent record of the operations and act as legal

papers as well as future references for the company.