Saturday, January 16, 2010
Henry Fayol's Biography
Henri Fayol (1841-1925) was a French management theorist whose theories in management and organization of labor were widely influential in the beginning of 20th century. He was a mining engineer who worked for a French mining company Commentry-Fourchamboult-Decazeville, first as an engineer. Then he moved into general management and became Managing Director from 1888 to 1918. During his tenure as Managing Director he wrote various articles on 'administration' and in 1916 the Bulletin de la Société de l’ Industrie Minérale, printed his "Administration, Industrielle et Générale – Prévoyance, Organisation, Commandement, Coordination, Contrôle". In 1949 the first English translation appeared: ‘General and Industrial Management’ by Constance Storrs.
Henri Fayol (Istanbul, 29 July 1841–Paris, 19 November 1925) was a French mining engineer, director of mines, and management theorist, who developed independent of the theory of Scientific Management, a general theory of business administration also known as Fayolism. He was one of the most influential contributors to modern concepts of management.
Fayol was born in 1841 in a suburb of Istanbul, Turkey, where his father, an engineer, was appointed superintendent of works to build a bridge over the Golden Horn (Galata Bridge). They returned to France in 1847. Fayol studied at the mining school "École Nationale Supérieure des Mines" in Saint-Étienne.
When 19 years old he started as an engineer at a mining company "Compagnie de Commentry-Fourchambeau-Decazeville" in Commentry. He became director in 1888, when the mine company employed over 1,000 people, and held that position over 30 years until 1918. By 1900 the company was one of the largest producers of iron and steel in France and was regarded as a vital industry.
In 1916 he published his experience in the book "Administration Industrielle et Générale", only a few years after Frederick Winslow Taylor had published his theory of Scientific Management.
Fayolism is one of the first comprehensive statements of a general theory of management, developed by Fayol. He has proposed that there are six primary functions of management and 14 principles of management
Controlling is described in the sense that a manager must receive feedback about a process in order to make necessary adjustments. Principles of Management
Division of work. This principle is the same as Adam Smith's 'division of labour'. Specialisation increases output by making employees more efficient.
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 organisation. Good discipline is the result of effective leadership, a clear understanding between management and workers regarding the organisation's rules, and the judicious use of penalties for infractions of the rules.
Unity of command. Every employee should receive orders from only one superior.
Unity of direction. Each group of organisational activities that have the same objective should be directed by one manager using one plan.
Subordination of individual interests to the general interest. The interests of any one employee or group of employees should not take precedence over the interests of the organisation as a whole.
Remuneration. Workers must be paid a fair wage for their services.
Centralisation. Centralisation refers to the degree to which subordinates are involved in decision making. Whether decision making is centralised (to management) or decentralised (to subordinates) is a question of proper proportion. The task is to find the optimum degree of centralisation for each situation.
Scalar chain. The line of authority from top management to the lowest ranks represents the scalar chain. Communications should follow this chain. However, if following the chain creates delays, cross-communications can be allowed if agreed to by all parties and superiors are kept informed.
Order. People and materials should be in the right place at the right time.
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 organisation.
Fayol's work has stood the test of time and has been shown to be relevant and appropriate to contemporary management. Many of today’s management texts including Daft have reduced the six functions to four: (1) planning; (2) organizing; (3) leading; and (4) controlling. Daft's text is organized around Fayol's four functions.