Fayol’s Principles of Management: The Foundation of Modern Administrative Theory
Published on: October 25, 2025
Fayol’s Principles of Management. In the development of the classical school of management thought, Fayol’s administrative theory provides an important link. While Taylor succeeded in revolutionising the working of the factory shop-floor in terms of devising the best method, fair day’s work, differential piece-rate system, and functional foremanship, Henri Fayol explained what amounts to a manager's work and what principles should be followed in doing this work. According to Fayol, all activities of an industrial undertaking could be divided into: Technical, Commercial, Financial, Security, Accounting, and Managerial. He also suggested that qualities a manager must possess should be — Physical, Moral, Education, Knowledge, and experience. He believed that the number of management principles that might help to improve an organisation’s operation is potentially limitless. n. The 14 principles of management propounded by him were discussed in detail in his book published in 1917, ‘Administration industrielle et generale’. For his contribution, he is also known as the ‘Father of General Management’ .
The 14 principles of management given by him are:
(i) Division of Work: Work is divided into small tasks/ jobs. A trained specialist who is competent is required to perform each job. Thus, division of work leads to specialisation. Specialisation is the most efficient way to use human effort.” In business, work can be performed more efficiently if it is divided into specialised tasks; each performed by a specialist or trained employee. This results in efficient and effective output.
(ii) Authority and Responsibility: According to Fayol, “Authority is the right to give orders and obtain obedience, and responsibility is the corollary of authority. There should be a balance between authority and responsibility. An organisation should build safeguards against abuse of managerial power. At the same time, a manager should have the necessary authority to carry out their responsibility.
(iii) Discipline: Discipline is the obedience to organisational rules and employment agreement, which are necessary for the working of the organisation. According to Fayol, discipline requires good superiors at all levels, clear and fair agreement,s and judicious application of penalties.
(iv) Unity of Command:
According to Fayol, there should be one and only one boss for every individual employee. If an employee gets orders from two superiors at the same time, the principle of unity of command is violated.
(v) Unity of Direction:
All the units of an organisation should be moving towards the same objectives through coordinated and focussed efforts. Each group of activities having the same objective must have one head and one plan. This ensures unity of action and coordination.
The difference between Unity of Command and Unity of Direction is as follows:
(vi) Subordination of Individual Interest to General Interest:
The interests of an organisation should take priority over the interests of any one individual employee according to Fayol. Every worker has some individual interest for working in a company. The company has got its own objectives. The interests of the group/company will supersede the interests of any one individual.
(vii) Remuneration of Employees:
The overall pay and compensation should be fair to both employees and the organisation. The employees should be paid fair wages, which should give them at least a reasonable standard of living. At the same time, it should be within the paying capacity of the company.
(viii) Centralisation and Decentralisation:
The concentration of decision-making authority is called centralisation, whereas its dispersal among more than one person is known as decentralisation. According to Fayol, “There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through centralisation.”
(ix) Scalar Chain:
An organization consists of superiors and subordinates. The formal lines of authority from highest to lowest ranks are known as scalar chain. According to Fayol, “Organizations should have a chain of authority and communication that runs from top to bottom and should be followed by managers and the subordinates.” The shortest route in a scalar chain is called the Gang Plank.
(x) Order:
According to Fayol, “People and materials must be in suitable places at the appropriate time for maximum efficiency.” The principle of order states that ‘A place for everything (everyone) and everything (everyone) in its (her/his) place’. Essentially, it means orderliness.
(xi) Equity:
Good sense and experience are needed to ensure fairness to all employees, who should be treated as fairly as possible,” according to Fayol. This principle emphasises kindness and justice in the behavior of managers towards workers.
(xii) Stability of Personnel:
Employee turnover should be minimised to maintain organisational efficiency.. Personnel should be selected and appointed after a due and rigorous procedure. But once selected, they should be kept at their post/ position for a minimum fixed tenure. They should have stability of tenure.
(xiii) Initiative:
Workers should be encouraged to develop and carry out their plans for improvements according to Fayol. Initiative means taking the first step with self-motivation. But it does not mean going against the established practices of the company for the sake of being different. A good company should have an employee suggestion system whereby initiative/suggestions that result in substantial cost/time reduction should be rewarded.
(xiv) Esprit De Corps:
Management should promote a team spirit of unity and harmony among employees, according to Fayol. Management should promote teamwork, especially in large organisations, because otherwise, objectives would be difficult to realise. It will also result in a loss of coordination. A manager should replace ‘I’ with ‘We’ in all his conversations with workers to foster team spirit. This will give rise to a spirit of mutual trust and belongingness among team members. It will also minimise the need for using penalties.
Then and Now - A Framework for Managing Today's Organizations Effectively, published in the Journal "Management Decision," 39/10 (2001), pp. 880-889, is as follows:
