Henry Fayol, also known as the ‘father of modern management theory’ gave a new perception of

the concept of management. He introduced a general theory that can be applied to all levels of
management and every department. The Fayol theory is practised by the managers to organize
and regulate the internal activities of an organization. He concentrated on accomplishing
managerial efficiency.

The fourteen principles of management created by Henri Fayol are explained below.

1. Division of Work-

Henri believed that segregating work in the workforce amongst the worker will enhance the
quality of the product. Similarly, he also concluded that the division of work improves the
productivity, efficiency, accuracy and speed of the workers. This principle is appropriate for both
the managerial as well as a technical work level.

2. Authority and Responsibility-

These are the two key aspects of management. Authority facilitates the management to work
efficiently, and responsibility makes them responsible for the work done under their guidance or
leadership.

3. Discipline-

Without discipline, nothing can be accomplished. It is the core value for any project or any
management. Good performance and sensible interrelation make the management job easy and
comprehensive. Employees good behaviour also helps them smoothly build and progress in their
professional careers.

4. Unity of Command-

This means an employee should have only one boss and follow his command. If an employee
has to follow more than one boss, there begins a conflict of interest and can create confusion.
5. Unity of Direction-

Whoever is engaged in the same activity should have a unified goal. This means all the person
working in a company should have one goal and motive which will make the work easier and
achieve the set goal easily.

6. Subordination of Individual Interest-

This indicates a company should work unitedly towards the interest of a company rather than
personal interest. Be subordinate to the purposes of an organization. This refers to the whole
chain of command in a company.

7. Remuneration-

This plays an important role in motivating the workers of a company. Remuneration can be
monetary or non-monetary. However, it should be according to an individual’s efforts they have
made.

8. Centralization-

In any company, the management or any authority responsible for the decision-making process
should be neutral. However, this depends on the size of an organization. Henri Fayol stressed on
the point that there should be a balance between the hierarchy and division of power.

9. Scalar Chain-

Fayol on this principle highlights that the hierarchy steps should be from the top to the lowest.
This is necessary so that every employee knows their immediate senior also they should be able
to contact any, if needed.

10. Order-

A company should maintain a well-defined work order to have a favourable work culture. The
positive atmosphere in the workplace will boost more positive productivity.

11. Equity-

All employees should be treated equally and respectfully. It’s the responsibility of a manager that
no employees face discrimination.

12. Stability-

An employee delivers the best if they feel secure in their job. It is the duty of the management to
offer job security to their employees.

13. Initiative-

The management should support and encourage the employees to take initiatives in an
organization. It will help them to increase their interest and make then worth.

14. Esprit de Corps-

It is the responsibility of the management to motivate their employees and be supportive of each
other regularly. Developing trust and mutual understanding will lead to a positive outcome and
work environment.

This 14 principles of management are used to manage an organization and are beneficial for
prediction, planning, decision-making, organization and process management, control and
coordination.
Also Read about the Difference Between Fayol and Taylors Theories of Management

For more data on Business Studies Class 12 Syllabus, Commerce notifications and sample
papers for Class 12 Commerce, stay tuned to BYJU’S.

Important Topics in Accountancy:

 Partnership Deed
 What is Goodwill?
 Treatment of Goodwill
 What Is Partnership

Frequently Asked Questions on Principles of Management

What Is the First Rule of Management?

The first rule of management is delegation. It is also known as division of work or
responsibilities.

Name Any 5 Principles of Management?

Five principles of management are as follows:
1.Division of work
2.Unity of Command
3.Subordination of individual interest
4.Unity of Direction
5.Remuneration

What Is the Importance of the 14 Principles of Management?

The principles of management allows managers to understand how to run an organisation. It
also helps them to accomplish tasks and manage situations as and when they arise in the
organisation.

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