Adminstrative Theory

8/22/2019 Adminstrative Theory

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Administrative

Theory of

Management


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Administrative Theory

Also called as Fayolism.

A theory of management that analyzed and

synthesized the role of management in organizations.

Focused on managerial practices that could

minimize misunderstandings and increase efficiency

in organizations. The focus is on enlightened

managers on how to accomplish their managerial

duties.


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Contributors


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Contributors

Mary Parker Follet

(1868-1993)

-Management isSocial Process.

-It consists ofmotivating individuals andgroups to work towardsthe common end.

Chester I. Bernard

(1886-1961)

-Concerned withthe optimal approach foradministrators to achieveeconomic insufficiency.


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Henri Fayol (1841-1925)

a French industrialist, widely regarded as The

Father of Modern Management. Henri Fayol

was concerned the principles of organization

and the function of management. Fayol laid

the foundation of management as a separate

body of knowledge. He always insisted that if

scientific forecasting and proper methods are

used in management than company can get

satisfactory results. According to Fayol,

management was not personal talent; it is a

knowledge base skill.


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Division of Activities

Fayol found out that activities of an organization could be

divided into six groups:

Techinical- activities concerning production.

Commercial- activities concerning buying, selling and exchange.

Financial- activities concerning optimum use of capital.

Security- activities concerning protection of property and

persons.

Accounting- activities concerning final accounts, costs and

statistics.

Managerial- activities concerning planning, organizing,

commanding, coordinating and controlling


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Fayols Fourteen Principles of

Management

Fayol formulated a

set of fourteen

principles as

guidelines for

implementing the

process of

management:

Division of Work

Authority &

Responsibilty

Discipline

Unity of

Command

Unity of Direction

Subordination of

Individual to

General Interest

Renumeration

Centralization

Scalar Chain

Order

Equity

Stability of Tenure

Initiative

Espirit de Corps


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Management Division of Work- This is the specialization that

economists consider necessary for efficiency in the

use of labor. Fayol applies the principles of all kinds

of work, managerial and technical.

Authority & Responsibility- Fayol finds authority and

responsibility to be related, the latter, arising from

the former. He sees authority as a combination of

official factor, deriving from the managers

position, and personal factors composed of

intelligence, moral worth and experience.


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Management

Discipline- Fayol sees discipline as

respect for agreements which are

directed as achieving obedience,

application and energy.

Unity of Command This means thatsubordinates should receive orders from

one superior only.


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Management Unity of Direction- In this principle in each group of

activities, the same objective must have one head

and one plan. As distinguished from unity of

command, this relates to the organization of the

body corporate, rather than to personnel. He

did not mean that all decisions should be made at

the top.

Subordination of Individual to General Interest-

When the interest of management and the

workers differ, management must reconcile them.


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Management Remuneration- The remuneration and

methods of payment should be fair. It

should afford the maximum satisfaction to

employees and employer.

Centralization- Fayol refers to the extent to

which authority is concentrated. Individual

circumstances will determine the degree

that will produce the best overall yield.


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Management

Scalar Chain- This is the chain of

superiors from the highest to the lowestranks.

Order- Breaking this intomaterial and

social order, Fayol believes that there

should be an arrangement of things and

people in an organization.


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Management Equity- Loyalty and commitment should be

elicited from personnel by a combination of

kidness and justice on the part of managers

when dealing with subordinates.

Stability of Tenure- Fayol pointed out the

unnecessary turnover to be both the cause

and the effect of poor management and

stressed its dangers and costs.


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Management Initiative- is conceived to be the thinking out and

execution of a plan and one of the satisfactions

for an intelligent individual to experience. Fayolexhorts managers to sacrifice personal vanity in

order to permit subordinates to exercise it.

Esprit de Corps- This is the principle that in unity,

there is strength. This, in effect, is the extension of

the principle of unity of command which

emphasizes the need for teamwork and the

importance of communication in obtaining it.

Adminstrative Theory

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