Business Studies

Project
Submitted by – Feba Mary Suresh
Class – XIIth Commerce
Roll no -17
 Henri Fayol
Henri Fayol was born in a suburb of Istanbul, Turkey in 1841. His
father, an engineer, was appointed building supervisor for the
construction of a bridge over the Golden Horn (Galata Bridge).
He studied mining engineering at the ‘École Nationale Superieure
des Mines’ academy in Saint-Étienne. Henri Fayol started his
career as an engineer at the mining company Compagnie de
Commentry Fourchambeau Decazeville in Commentry at the age
of 19. In 1888, he became the Managing Director of this mining
company that employed over 1,000 people.
Henri Fayol was very successful in this position for over 30 years
(until 1918). Around 1900 the mining company was one of the
largest producers of iron and steel in France. At that time this
industry was considered to be vital for France.
In addition to being the Managing Director of the Commentry-
Fourchambault mining company (1900), Fayol was also one of
the founders of the principles of modern management. His
research work was in competition with that of another great
theoretician namely Frederick Taylor.
In 1916, Henri Fayol published his work experience in the book
Administration Industrielle et Generale (General and Industrial
Management).
 Fredrick Winslow Taylor
Frederick Winslow Taylor was an economist and American
industrial engineer, who is considered the father of scientific
administration, a forerunner of industrial engineering and
recognized for promoting the scientific organization of work.
Taylor was born on March 20, 1856, in Philadelphia.
In 1875, he decided to start working in a steel factory in
Philadelphia, where he learned from each of the steelmaking
processes.
His excellent performance and learning, made Frederick Taylor
take a step forward in his work since he later began to lead a
machine shop. In his new job, he began to make detailed
observations on the work carried out by the workers in charge of
cutting metals. Based on his observations, the idea of ​analyzing the
work emerged, dividing each process into smaller, simpler tasks,
which had a certain execution time, with which workers were
required to perform each task in the established time.
He formed a work team with which he proposed and developed his
methods, complementing his innovative ideas with other inventions
and published in 1911, his most outstanding book “The Principles
of Scientific Management” where he focused on the defense of the
scientific organization of work.
.
 What are the Principles of Management?

The organisational principle is the great and overall direction for determining the
performance. For instance, while ascertaining about the promotion of an employee, a
manager may contemplate seniority, whereas the other may follow the principle of quality.
One may define principles of management from those of pure science. Management
principles are not as firm as postulates of pure science. They deal with human traits and,
hence, are to be employed creatively given the requirements of the position. Human
behaviour is never inactive and so also technology, which business. Therefore all the
principles have to keep step with these changes. For instance,
• In the absenteeism of Information and Communications Technology (ICT), a manager
could manage only a small workforce that too within a restricted geographical area.
• The approach of ICT has developed the ability of the managers to control over large
business domains scattered across the globe.
• In promoting an understanding of the application of principles of management, it is also
helpful to comprehend what these are not.
• The principles of management should be selected from techniques of management.
Techniques are methods or techniques, which include a group of steps to be taken to
achieve sought goals.
• Principles are guidelines to make judgements or actions while studying techniques.
Moreover, principles should also be comprehended as being different from values .
 Principles Of Management
Division of Work - Fayol presented work specialization as the best way to
use the human resources of the organization.
• Authority - Managers must be able to give orders. Authority gives them
this right. Note that responsibility arises wherever authority is exercised.
• Discipline - Employees must obey and respect the rules that govern the
organization. Good discipline is the result of effective leadership.
• Unity of command - Every employee should receive orders from only one
superior.
• Unity of direction - Each group of organizational activities that have the
same objective should be directed by one manager using one plan for
achievement of one common goal.
• Subordination - The interests of any one employee or group of employees
should not take precedence over the interests of the organization as a whole.
• Remuneration - Workers must be paid a fair wage for their services.
 • Centralization - Centralization refers to the degree to which subordinates
are involved in decision making
. • Scalar chain - The line of authority from top management to the lowest
ranks represents the scalar chain. Communications should follow this
chain.
• Order - this principle is concerned with systematic arrangement of men,
machine, material etc. there should be a specific place for every employee
in an organization
• Equity - Managers should be kind and fair to their subordinates.
• Stability of tenure of personnel - High employee turnover is inefficient.
Management should provide orderly personnel planning and ensure that
replacements are available to fill vacancies.
• Initiative - Employees who are allowed to originate and carry out plans
will exert high levels of effort.
• Esprit de corps - Promoting team spirit will build harmony and unity
within the organization.
 Principles of Scientific Management by
Taylor:
F.W. Taylor or Fredrick Winslow Taylor is also known as the ‘father of scientific
management’ proved with his practical theories that a scientific method can be implemented
to management. Taylor gave much concentration on the supervisory level of management
and performance of managers and workers at an operational level. Let’s discuss in detail the
five(5) principles of management by F.W Taylor.

1. Science, not the Rule of Thumb-

This rule focuses on increasing the efficiency of an organisation through scientific analysis
of work and not with the ‘Rule of Thumb’ method. Taylor believed that even a small activity
like loading paper sheets into boxcars can be planned scientifically. This will save time and
also human energy. This decision should be based on scientific analysis and cause and effect
relationships rather than ‘Rule of Thumb’ where the decision is taken according to the
manager’s personal judgement.

2. Harmony, Not Discord-

Taylor indicated and believed that the relationship between the workers and management
should be cordial and complete harmony. Difference between the two will never be
beneficial to either side. Management and workers should acknowledge and understand each
other’s importance. Taylor also suggested the mental revolution for both management and
workers to achieve total harmony.
3. Mental Revolution-This technique involves a shift of attitude of management
and workers towards each other. Both should understand the value of each other
and work with full participation and cooperation. The aim of both should be to
improve and boost the profits of the organisation. Mental Revolution demands a
complete change in the outlook of both the workers and management; both should
have a sense of togetherness.

4. Cooperation, not Individualism-

It is similar to ‘Harmony, not discord’ and believes in mutual collaboration
between workers and the management. Managers and workers should have
mutual cooperation & confidence and a sense of goodwill. The main purpose is to
substitute internal competition with cooperation.

5. Development of Every Person to his Greatest Efficiency-

The effectiveness of a company also relies on the abilities and skills of its
employees. Thus, implementing training, learning best practices and technology,
is the scientific approach to brush up the employee skill. To assure that the
training is given to the right employee, the right steps should be taken at the time
of selection and recruiting candidates based on a scientific selection
Techniques of Scientific
Management
Functional Foremanship:
Functional foremanship is a factory administration system that supports for
possessing numerous foremen in separate, functional roles. Classically, factories had
just 1 manager who would manage operations. This manager or the foreman was the
only contact for factory employees. Frederick Winslow Taylor, the distinguished
engineer who transformed scientific management during the end of the 19th century,
discovered a significant defect in this practice. When he recorded all of the features
a successful supervisor would require, he discerned that no one person could
probably have every single one. Therefore, the idea of working foremanship was
born.

Standardisation and Simplification of Work:

What is Standardisation?
Standardisation implies to the method of establishing standards for every industry
activity; it can be standardisation of manner, time, raw material, machinery, product,
processes or operating situations. These examples are the benchmarks, which must
be adhered to throughout the production.
What is Simplification?
Simplification points at erasing unnecessary types, sizes and dimensions while
standardisation intends devising new types rather than the existing ones.
Simplification points at eliminating a redundant variety of products. It results in
savings of the cost of machines, tools and labour. It means controlled inventories,
complete utilisation of supplies and boosting turnover.
Method Study:
The purpose of the outlined study is to find out one vigorous way of performing the
job. There are different ways of performing the job. To ascertain the best way, there
are diverse parameters. Right from the obtainment of raw materials until the ultimate
product is presented to the consumer, every pursuit is part of method research. Taylor
devised the idea of the assembly line by applying the method study.

Motion Study:
Motion study pertains to the study of movements like putting objects, lifting,
changing positions and sitting etc., which are moved while doing a conventional job.
Random movements are solicited to be reduced so that it takes less time to perform
the job effectively.
Time Study:
It circumscribes the conventional time taken to complete a well-defined job.
Time regulating devices are used for each part of the task. The standard time is
set for the entirety of the task by taking different readings. The course of time
study will rely upon the frequency and volume of the task, the cycle time of the
process and time measurement costs.

Fatigue Study:
A person is obliged to feel tired mentally and physically if she or he does not
relax while working. The rest periods will assist one to recover vitality and
work again with the same capacity. This will result in improved potency.
Fatigue study tries to define the amount and regularity of rest intervals in
accomplishing a task.
 What is Fayol and Taylor’s Theories of
Management
Management is a process through which the members of an
organization gets the job done with the help of other people. The
decision-making process and the performance of management are
guided by various principles of management. Different management
theories are composed of many management thinkers. Out of which,
two such eminent thinkers are Fredrick Winslow Taylor (F.W. Taylor)
and Henry Fayol.

In management theory, Henry Fayol, a French mining engineer

contributed fourteen management principles and various concept of a
general theory of administration, whereas, F.W.Taylor, an American
mechanical engineer improved the theory of scientific management and
contributed four management principles. Let’s learn in-depth the Fayol
vs Taylor’s Theories of Management.
Henry Fayol Theory of Management
Henry Fayol also known as ‘father of modern management theory’ gave a new
perception to 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.

F.W.Taylor Theory of Management

F.W. Taylor or Fredrick Winslow Taylor is also known as the ‘father of
scientific management’ proved with his practical theories that a scientific
method can be implemented to management. This scientific process involved
experiments, observation, analysis, and inference and was applied to create a
cause and effect relationship. Taylor gave much concentration on the
supervisory level of management and performance of managers and workers at
an operational level.
Key Differences Between Fayol and Taylor’s
Theory of Management
1. The difference between Fayol and Taylor’s Theory of Management, are explained in
the points presented below:
2. Henry Fayol is a father of modern management who enunciated fourteen principles of
management, for improving overall administration. As against, F.W. Taylor is a father
of scientific management who developed four principles of management, for
increasing overall productivity.
3. Henry Fayol introduced the concept of General theory of administration. F.W. Taylor
laid down the concept of Scientific Management.
4. Henry Fayol emphasized the working of top level management, whereas F.W. Taylor
stressed on the working of production level management.
5. Fayol’s management theory has universal applicability. Unlike Taylor, whose
management theory applies to a number of organizations only.
6. The basis of formation of Fayol’s theory is the personal experience. Conversely,
Taylor’s principles rely on observation and experimentation.
7. Fayol is oriented towards managerial function. On the contrary, Taylor focussed on
production and engineering.
8. The system of wage payment determined by Taylor is differential piece rate system,
while Fayol stressed on sharing of profits with managers.
9. The approach of Taylor is termed as Engineer’s approach. In contrast, Fayol’s
approach is accepted as manager’s approach.
Thank you