The search for principles of management

Henri Fayol
a celebrated French industrialist and theorist who began his working life as a young mining
engineer the age of 19. he spent his entire working life with the same company, rising to
managing director at the age of 47 and only retiring after his 77th birthday. Under his leadership,
the company grew and prospered despite its near-bankrupt state when he took over. His
entrepreneurial successes won him considerable fame and popularity.

The publication of ‘administration industrielle et generale’ in 1916 brought to light the

distillation of a lifetimes experience of managerial work. The best known English translation of
the same book was done by Constance Storrs, published by Pitmans under the title of ‘general
and industrial management’

the foreword to this translation was done by L.F. Urwick who had a fear that Fayol’s work
maybe mistaken as only applicable to industries (because they translated administration in
French into management in English) whereas in Urwicks view it was just as applicable to central
and local government as well.

Fayol’s definition of management

He outlined six key activities as follows:

1. technical activities for example production

2. commercial activities for example buying and selling
3. financial activities for example securing capital
4. security activities for example safe guarding property
5. accounting activities for example providing financial information
6. managerial activities for example planning and organising

Fayol quickly accepted that the first 5 were straight forward but the sixth required more
explanation. He stated that the first 5 activities were all interdependent to some extent, there was
no single one which was concerned with broad planning and resourcing. It is why the 6th item
was isolated and named managerial.

To manage, said Fayol is to forecast and plan, to organise, to command, to coordinate and to
control. He saw forecasting and planning as looking to the future and drawing up a plan of
action. Organizing was seen in structural terms, and commanding described as maintaining
activity among the personel. Coordinating was seen as essentially a unifying activity. Controlling
meant ensuring that things happen in accordance with established policies and practice. Fayol did
not see managerial activities as exclusively belonging to management. Fayols analysis was
however considered to have far reaching implications than Taylors ideas on scientific mgt which
were centred on the shop floor.

Fayols principles of management

he emphasized that these principles were not absolutes but capable of adaptation, according to
the need.

1 Division of work Reduces the span of attention of one person

or group. Develops practice and familiarity
2 Authority The right to give orders. Shouldn’t not be
considered without reference to
responsibility
3 Discipline Outward marks of respect in accordance
with formal or informal agreement between
firm and employees
4 Unity of command One man one superior
5 Unity of direction One head and one plan for a group of
activities with the same objective
6 Surbordination of individual interest to The interest of one individual or one group
general interest should not prevail over the general good
 7 Renumeration Pay should be fair to both the employee and
the firm
8 Centralization Is always present to a greater or lesser extent
depending on the size of the company and
the quality of its managers
9 Scalar chain The line of authority from top to bottom of
the organization
10 Order A place for everything and everything in its
place. The right man in the right place
11 Equity A combination of kindliness and justice
towards employees
12 Stability of tenure of personel Employees need to be given time to settle
into their jobs even though this maybe a
lengthy period in the case of managers
13 Initiative Within the limits of authority and discipline,
all levels of staff should be encouraged to
show initiative
14 Espirit de corps Harmony is a great strength to an
organization, teamwork should be
encouraged.

Fayols general principles have been adopted by later followers of the classical school, such as
Urwick and Brech. Present day theorists however would not find much of substance in these
precepts.

1. The reference to division of work, scalar chain, unity of command and centralization for
example are descriptive of the kind of formal organization that has come to be known as
bureaucracy. Fayol, in true classical fashion, was emphasizing the true classical nature of
organisations.
2. Issues such as individual vs general interests, remuneration and equity were considered
very much from the point of paternalistic management.
3. Although emphasizing the hierarchical aspects of the business enterprise, Fayol was well
aware of the need to avoid an excessively mechanistic approach towards employees.
Thus references to initiative and espirit de corps indicated his sensitivity to peoples needs
as individuals and as groups.
4. Fayol was the first to achieve a genuine theory of management based on a number of
principles which could be passed on to others. Many of these principles have been passed
into modern organisations. Their effect on organizational effectiveness has been subject
to increasing criticism over the years mainly because such principles were not designed
to cope with modern conditions of rapid change, flatter structures and increased
employee participation in the decision making process of the organization.
FW Taylor and scientific management.
The pioneers of scientific management. F.W. Taylor, Frank and Lilian Gilbreth and H Gantt

Fredrick Winslow Taylor (1856-1915)

Was born in Boston, Massachusetts in 1856
He spent the greater part of his life working on problems to come up with greater efficiency on
the shop floor.
The solutions he came up with were based on his own experience initially as a shop floor worker
and later as a manager. He began his career as an apprentice in engineering. Having served his
time he moved to Midvale steel company where in the course of elven years he rose from
labourer to shop superintendent. It was during this time that his ideas of scientific mgmt. were
born. In 1889 he left Midvale to work for Bethlehem steel company where he conducted some of
his most famous experiments in improving labour productivity. Taylor was keen to pass on his
ideas to others, which he achieved through his writings, most notably ‘the principles of scientific
management’ published in 1911. After his death, his major works were collected together and
published as ‘scientific management’ in 1947. He did not meet Henri Fayol and it is possible that
he did not know of Fayol’s analysis of management.

The setting for scientific management

The last twenty years or so of the nineteenth century were a time of facing up to the often ugly
realities of factory life.
From the employer’s point of view, efficiency of working methods was the dominant issue.
Gathering pace of industrial revolution in the western world gave rise to new factories, plant and
machinery and plenty of labour. The problem was how to organise all these elements into
efficient and profitable operations.
It was against this background that Taylor developed his ideas. He was passionately interested in
the efficiency of working methods. At an early age he realised that the key to such problems lay
in the systematic analysis of work. Experience, both as a worker and as a manager had convinced
him that few, if any workers put more than the minimal effort into their daily work. He described
this effort as soldiering. This he subdivided into natural soldiering that is man’s natural tendency
to take things easy and systematic soldiering that is the deliberate and organised restriction of the
work rate by the employees.
The reasons for soldiering appeared to Taylor to arise from 3 issues:
1. Fear of unemployment
2. Fluctuations in the earnings from piece rate systems
3. Rule of thumb methods permitted by management
Taylors answers to these issues was to practice ‘scientific management’

The principles of scientific management

Taylor realised that the measures he was proposing were not going to appear simply as new but
rather revolutionary. He stated that scientific management would require a complete mental
revolution on the part of both management and the workers.

In its application to management, the scientific approach would require the following steps:
 Develop a science for each operation to replace opinion and rule of thumb
 Determine accurately from science the correct time and method for each job
 Set up a suitable organisation to take all responsibility from workers except that of actual
job performance
 Select and train workers
 Accept that management itself be governed by the science developed for each operation
and surrender its arbitrary power over worker that is cooperate with them.

Taylor saw that if changes were to take place at the shop floor level, then facts would have to
replace opinion and guess work. This would be done by studying a sample of jobs of skilled
workers noting each operation and timing it with a stop watch. All unnecessary movements
would then be eliminated in order to produce the best method of doing a job. This best method
would then become the standard to be used for all like jobs. This analytical approach has come to
be known as work study.
In Taylor’s time the most common practice was for management to leave working methods to
the initiative of the workers. What taylor called “rule of thumb.” his suggestion that managers
should take up this role was certainly new. On top of all this it was reducing the scope of an
individual’s job. Contemporaries said it turned people into automatons. Taylor argued that the
average worker preferred to be given a definite task with clear cut standards. The outcome for
future generations was the separation of planning and controlling from the doing, or the
fragmentation of work. Mc gregors theory x assumption of workers is essentially a description
produced by taylors ideas.
Taylor felt that everyone should benefit from scientific management, workers as well as the
managers. He disagreed with the way most piece rate systems were operated in his day, as the
practice was for management to reduce the rates if worker’s earnings went up beyond an
acceptable level. Taylors view was that having scientifically measured the workers’ jobs and set
rates accordingly, then efficient workers should be rewarded for their productivity without limit.
The difficulty for most managers was that they lacked taylors expertise in measuring times and
had to resort to arbitrary reduction in rates where measurements had been loose.
In as far as workers were concerned, scientific management required them to:
1. Stop worrying about the division of fruits of production between wages and profits.
2. Share in the prosperity of the firm by working in the correct way and receiving wage
increases of between 30% and 100% according to the nature of the work.
3. Give up their ideas of soldiering and cooperate with management in developing the
science.
 4. Accept that management would be responsible, in accordance with scientific approach,
for determining what was done and how.
5. Agree to be trained in new methods, where applicable.
One of Taylor’s basic theses was that the adoption of the scientific approach would lead to
increased prosperity for all. It was therefore much more important to contribute to a bigger cake
than argue about the division of the existing cake. It has to be said that trade unions at the time
did not agree with his style. Taylor saw them as decidedly restrictive influence on issues such as
productivity. In his view, wages could now be scientifically determined and should not be
affected by arbitrary factors such as union power or management whim. His own experience had
shown how workers earnings considerably increased by adopting their part of scientific
approach.
Although workers’ feelings towards work study have often been favourable, the ultimate success
of work study incentive schemes has always been rather limited owing to workers feelings that
management was attempting to pin them down and to managements feeling that the workers has
succeeded in pulling the wool over their eyes concerning the timing of key jobs.
In support of his principles, Taylor demonstrated the benefits of increased productivity and
earnings which he had obtained at Bethlehem steel works. He explained to his critics an
experiment with two shovelers. First class shovelers whose efforts were timed and studied. Each
man had his own personal shovel, which he used regardless of the type of core or coal being
shifted. At first, the average shovel load was about 38 pounds and with this load each man
handled about 25 tons of material a day. The shovel was then made smaller for each man, and the
daily tonnage went up to 30. Eventually it was found that with smaller shovels, averaging about
21 pounds peer load, the daily output rose even higher. As a result of this experiment, several
different sizes of shovels were supplied to the work force to enable each man lift 21 pounds per
load whether he was working with heavy ores or light coals. Labourers who showed themselves
capable of achieving the standards set by the two first class shovelers were able to increase their
earnings by 60%.
After 3 years, Taylor and his colleagues reviewed the extent of their success at the Bethlehem
works. The results were impressive. The work of 400 to 600 men was being done by 140.
Handling costs per ton had been reduced by half, and as taylor was quick to point out, that
included the cost of extra clerical work involved in studying the jobs. The labourers also received
an extra 60% more than their colleagues in neighbouring firms.

Scientific management after taylor

3 important followers were Frank and Lilian Gilbreth together with Henry Gant. All made
significant contributions to the study of work.
After inquiring from Taylor whether scientific management could be applied to brick laying.
Gilbreth later informed Taylor that as a result of analysing and subsequently redesigning the
working methods of typical brick layers he was able to reduce the number of movements in
laying the bricks from 18 per brick to 5 per brick.
A particular feature of Gilbreths work was its detailed content. Measurement was their byword
and the science of management as they put it consisted of applying measurement to management
and of abiding by the results. They were convinced that it was possible to find the one best way
of doing things. They invested heavily in there detailed approach as they paid their workers
much higher than neighbouring firms.
Two examples of the recording techniques used by the Gilbreths are the therbligs and process
chatting. Therbligs are the basic elements of the on job motions and provide a standardised basis
for recording movements.
Flow process charts were devised by the Gilbreths to enable whole operations or processes be
analysed.

Gantt was a contemporary and colleague of Taylor’s at the Bethlehem steel company. Whilst in
agreement with many of Taylor’s ideas on scientific management, Gantt felt that the individual
worker was not given enough consideration. Although Taylor was not a slave driver himself, his
methods were used by less scrupulous employers to squeeze as much production as possible out
of their work force. This was especially true in respect to piece rate systems.
Gantt introduced a payment system where performance below what is called for on the
individual instruction card still qualified the person for the day rate, but performance for all the
work allocated on the card qualified the individual for a handsome bonus. Gantt quickly
discovered that as soon as one worker discovered that he could do the work, the rest quickly
followed. Better use was made of the foremen, because they were sought after by individuals
who needed further instructions or help with faulty machines. As a result, supervision improved,
breakdowns were minimised and delays avoided by all concerned. Gantts bonus system also
allowed for men to challenge the time allocated for a particular task. This was permitted because
Gantt unlike the Gilbreths did not believe there was a one best way but only a way which seems
best at the moment. Gantt’s approach to scientific management left some discretion and initiative
to the workers unlike those of his colleagues.
Although it was his ideas on rewards for labour that made Gantt notable figure in his day, he is
best remembered nowadays for his charts.

Comments on scientific management school

The benefits:
1. Its rational approach to the organisation of work enabled tasks and processes to be
measured with a considerable degree of accuracy.
2. Measurement of tasks and processes provided useful information on which to base
improvements on working methods, plant design etc
3. By improving working methods, it brought enormous increases in productivity
4. It enabled employees to be paid by results and to take advantage of incentive payments
5. It stimulated management into taking more positive role in leadership at shop floor level
 6. It contributed to major improvements in physical working conditions for employees.
7. It provided the foundation on which modern work study and other quantitative techniques
could be soundly based.
The draw backs:
1. It reduced the workers role to that of a rigid adherence to methods and procedures over
which he had no discretion
2. It led to fragmentation of work on account of its emphasis on the analysis and
organisation of individual tasks or operations
3. It generated a ‘carrot and stick’ approach to the motivation of employees by enabling pay
to be geared tightly to output.
4. It put the planning and control of the work place activities exclusively in the hands of
management
5. It ruled out any realistic bargaining about wage rates since every job was measured,
timed and rated ‘scientifically.’

MAX WEBER AND THE IDEA OF BUREAUCRACY

Bureaucracy is a term with several meanings and this has led to several misconceptions about
what it truly means.

The most common meanings are as follows;

Bureaucracy is ‘red tape’, ie an excess of paperwork and rules leading to gross inefficiency. This
is the pejorative sense of the word.
Bureaucracy is ‘officialdom’, ie all the apparatus of central and local government. This is a
similar meaning to red tape.
Bureaucracy is an organisational form with certain dominant characteristics, such as a hierarchy
of authority and a system of rules.
Here the term bureaucracy will be interpreted as an organisational form.

Max weber (1864-1920)

Unlike Fayol and Taylor wo were practicing managers, Max Webber was an academic and a
sociologist. He interest was in investigating why people in an organisation obeyed those in
authority over them.

It was in his 1947 publication that the term bureaucracy was used to describe the rational form of
organisation that today exists to a greater or lesser extent in practically every business and public
enterprise.

In his analysis of organisations, Webber identified three basic types of legitimate authority:
traditional, charismatic and rational-legal authority.

After mentioning authority, the concept of authority has to be distinguished from power. Power
is a unilateral thing. It enables one person to force another to behave in a certain way, whether by
means of strength or rewards.
While authority implies acceptance of rule by those over whom it is to be exercised. It
(authority) implies that power may only be exercised within limits agreeable to subordinates. It is
this later situation to which Webber refers when he talks about legitimate authority.
The three types of legitimate authority as described by Webber are:

1. Traditional authority. Where acceptance of those in authority arises from tradition and
custom. Take an example of monarchies, tribal hierarchies etc
2. Charismatic authority. Where acceptance arises from loyalty to, and confidence in, the
personal qualities of the ruler.
3. Rational-legal authority. Where acceptance arises out of the office, or position, of the
person in authority, as bounded by the rules and procedures of the organisation.
It is this last form of authority which exists in many organisations and the one to which webber
assigned the name ‘bureacracy’

The main features of bureaucracy according to webber are as follows;

1. A continuous organisation of functions bound by rules.

2. Specified spheres of competence, ie the specialisation of work, the degree of authority
allocated and the rules governing the exercise of authority.
3. A hierarchical arrangement of offices (jobs), ie where one level of jobs is subject to
control by the next higher level.
4. Appointment to offices are made on grounds of technical competence.
5. The separation of officials from the ownership of the organisation.
6. Official positions exist in their own right, and job holders have no rights to a particular
position.
7. Rules, decisions and actions are formulated and recorded in writing.

The above features of beauracratic organisations enable the authority of officials to be subject to
published rules and practices. Thus the authority is legitimate not arbitrary. It is this point more
than any other which caused Weber to comment that bureaucratic organisations were capable of
achieving the highest degree of efficiency and was, in that sense, the most rational known means
of carrying out ‘imperative control over human beings’

Weber felt that bureaucracy was indispensable for the needs of large scale organisation, and
there is no doubt that this form of organisation has been adopted in one way or another by
practically every enterprise of any size the world over. The two most significant factors in the
growth of bureaucratic forms of organisations are undoubtedly size and complexity. Once an
organisation begins to grow, the amount of specialisation increases which usually leads to
increase in job levels. New jobs are created and old jobs are redefined. Recruitment from outside
becomes more important. Relationships, authority boundaries and discipline generally have to be
regulated. Questions of coordination and control became all important. Thus a small, relatively
informal, family concern can suddenly grow into quite a different organisation requiring new
skills and new attitudes from its proprietors.

Although size almost inevitably implies complexity, there are also issues of complexity for
smaller organisations. These can arise out of requirements of sophisticated modern technology,
for example. In such an environment specialised and up to date skills are required, the span of
control has to be small,questions of quality control are vital and last, but by no means least, a
keen eye needs to be kept on the competition. Add to all these points external forces and the
result, is a highly complex environment, which can only be controlled in a systematic form of
organisation.

Weber’s contribution to our understanding of formal organisation structures has been a major
one. There have been several discussion on this topic and all have had reference to him.
Nevertheless, bureaucracy is not without its flaws and several researchers over the years have
identified these as follows;
1. Rules, originally designed to serve organisational efficiency, have a tendency to become
all important in their own right.
2. Relationships between office holders or roles are based on rights and duties of each role,
ie they are depersonalised, and this leads to rigid behaviour (predictability).
 3. Decision making seems to be categorised, ie choices are previously programmed and this
discourages the search for further alternatives, another form of rigidity.
4. The effects of rigid behaviour are often very damaging for client or customer relations
and also for management worker relationships. Customers are unable to obtain tailor
made services but have to accept standardisation. Employees have to work within a
framework of rules and controls which has been more or less imposed on them.
5. Standardisation and routine procedures make change and adaptation difficult when
circumstances change.
6. The exercise of ‘control based on knowledge’ as advocated by weber has led to growth of
experts, whose opinions and attitudes may frequently clash with those of generalist
managers and supervisors.

One particular well follow up to Weber’s theories was conducted by an American sociologist,
Alvin Gouldner. He studied the effects of introducing a bureaucratic system into an organisation
which had been very informal and indulgent in its management style. The head office of a small
gypsum company had appointed a new manager to make the plant more efficient. His new
approach led to the replacement of informal methods of working by formalised procedures such
as work study and production control. These changes were resented by the workforce and the
eventual outcome was a reduction rather than an increase in the efficiency of operations. In
studying this situation Gouldner (1955) identified three different patterns of bureaucracy
operating within one organiation. These were as follows;
1. Mock bureaucracy. This he attributed to situations where rules and procedures were
imposed by an outside body (eg head office) and where they were either ignored or were
merely paid lipservice to by the employees concerned. In this situation a separate set of
rules were developed by the employees.
2. Representative bureaucracy. In this case the rules were followed because both
management and employees agreed on their value.
3. Punishment centred bureaucracy. This description was applied to situations where either
management or employees imposed their rules on the other. Disregard of the rules was
seen as grounds for imposing sanctions. Each side considered its rules as legitimate, but
there was no common position.
Weber’s thinking on bureaucracy was dominated by his view of how rational it was. Gouldner by
contrast helped to indicate that opinions and feelings are also a key ingredient in the success of a
bureaucratic form of organisation. Whereas weber emphasized the structural aspects of the
organisation, Gouldner emphasized behaviour. He saw that rules not only generated anticipated
responses eg obedient behaviour, but also unanticipated behaviour, eg minimum acceptable
behaviour. Therefore, in anyone organisation, there will be a tendency to respond to the rules in
any of the three ways mentioned above, depending on how and why the rules were introduced.

Handy (1993) describes bureaucracies as ‘role cultures’ based on logic and rationality. In the role
culture, power comes from position power ie authority of the office, as determined by the rules
and procedures. Such a culture offers security and predictability to it members, but can be
frustrating to those who are ambitious and result oriented. Handy sees bureaucracy as a greek
temple, based on the firm pillars of its speciality departments and ideally constructed for
stability. Its very stability is a drawback in times of change. The Greek temple is not designed for
adaptability.

However one chooses to describe a bureaucracy, there is little doubt that it is by far the most
frequent form of organisation in society and the question that has to be asked is not so much ‘is
this organisation a bureaucracy?’ as ‘to what extent is this organisation a bureaucracy?’ the
evidence seems to suggest that there is something of a Greek temple in every organisation.