Lecture Notes: 14 Principles of Management by Omri Fayol

Introduction to Management in the 19th Century

• Early 19th-century organizations required management.
• Few external management tools, models, and methods were available.

Omri Fayol's Contribution

• Synthesized 14 principles of management.
• Published in "General and Industrial Management" (1916).

Overview of the 14 Principles of Management

1. Division of Work

   • Specialization allows focused effort and attention on specific tasks.
   • Maximizes use of human resources.

2. Authority and Responsibility

   • Authority: right to give orders and expect obedience.
   • Responsibility: being accountable; linked with authority.
   • Authority implies taking responsibility.

3. Discipline

   • Common effort required from workers.
   • Penalties applied judiciously to encourage effort.

4. Unity of Command

   • Workers receive orders from one manager only.

5. Unity of Direction

   • Organization should have a common objective and direction.

6. Subordination of Individual Interests

   • Organizational interest takes precedence over individual interests.

7. Remuneration

   • Consider factors such as cost of living, supply of personnel, business conditions in setting pay.

8. Centralization

   • Centralization: decreases the importance of subordinates.
   • Decentralization: increases subordinate importance.
   • Balance depends on organizational needs.

9. Scalar Chain

   • Hierarchical chain of authority.
   • Communication and authority flow from top to bottom.
   • Essential for organizational success.

10. Order

    • Efficiency requires treating materials and people related to specific work equally.

11. Equity

    • Fair treatment of all employees.

12. Stability of Tenure of Personnel

    • Retention of productive employees is a priority.
    • High recruitment costs and reject rates with frequent hiring.

13. Initiative

    • Encourage worker self-direction and additional work activities.

14. Esprit de Corps

    • Promote harmony and good feelings among workers.

Conclusion

• Principles provide a guideline for decision-making and management actions.
• Derived from observation and analysis of managerial practices.