XII BS CH 2 PPT.pdf

Principles of management

1. CHAPTER -2
PRINCIPLES OF MANAGEMENT
Prepared by:Sandeep Kumar N V
HSST Commerce,Katukukke HSS Kasaragod
Mob:[phone],E
mail:[email protected]
Residence :PILICODE

2. MEANING OF MANAGEMENT PRINCIPLE
A management principle is a broad and
general guideline for decision making and
behaviour of employees towards
organization. Principles are guidelines to
take decisions or actions.
Definition:
“ Management principles are fundamental
truth of general validity”
-Koontz and O’ Donnell

3. NATURE OF PRINCIPLES OF
MANAGEMENT:(CHARACTERISTICS)
1. Universal applicability:
Management principles are applicable to
any type of organisations like business
organizations, police force, sports clubs in
any part of the world.

4. The principles are guidelines to action.
Management principles are derived from
experience and analysis and they are in the
form of mere statements.
Example:
General Guidelines to
prevent Covid 19
2.General Guidelines:

5. 3.Formed by practice and
experimentation:
The principles of management are
formed by experience and collective
wisdom of managers as well as
experimentation

6. They are flexible and can be
modified by the manager when the
situation so demands. They give the
manager enough discretion to do
so.
4.Flexible:

7. Management principles aim at influencing
behaviour of human beings. Therefore,
principles of management are mainly
behavioural in nature
5.Mainly behavioural:

8. The principles of Management are
intended to establish relationship
between cause and effect so that they
can be used in similar situations in a
large number of cases.
6.Cause and effect relationship:

9. The application of principles of management
is contingent or dependent upon the prevailing
situation at a particular point of time.
7.Contingent (Relativity):

10. NATURE OF PRINCIPLES OF MANAGEMENT:
(CHARACTERISTICS)
1. Universal applicability:
2.General Guidelines:
3.Formed by practice and
experimentation:
4.Flexible:
5.Mainly behavioural:
6.Cause and effect relationship:
7.Contingent (Relativity):

11. SIGNIFICANCE/IMPORTANCE OF
MANAGEMENT PRINCIPLES:
Managers may apply these principles to fulfil their
tasks and responsibilities. Principles guide managers in
taking and implementing decisions.
The following points highlight the importance of
managerial management principles-

12. 1.Providing Managers with useful
insights into reality:
The principles of management provide the
managers with useful insights into real world
situations. When a manager follows sound
managerial principles, decisions based on them
will be perfect and accurate.

13. 2.Optimum utilization of resources
and effective administration:
Management principles help managers in
taking proper decisions in proper time. It
points out how time, money, materials and
human efforts can be used economically to
improve productivity.

14. 3.Scientific decisions:
With the help of Management Principles,
managers can take appropriate decisions in
right time. Management decisions taken on
the basis of principles are free from bias.

15. 4.Meeting changing environment
requirements:
Management principles are highly flexible and
therefore can be modified to meet changing
requirements of environment.

16. A business enterprise is an integral part of
society. Proper understanding of management
principles would enable the managers take
realistic view of organizational situations and their
social relevance.
5.Fulfilling social responsibility:

17. 6.Base for management training,
education and research:
Principles of management are at the
core of management theory. As such
these are used as a basis for
management training, education and
research.

19. EVOLUTION OF MANAGEMENT
PRINCIPLES
Schools of thought may be divided into 6 distinctive
phases:

20. 1.Early Perspectives:
The first known management ideas were recorded in
3000-4000 B.C. One Pyramid built by Egyptian ruler
Cheops required work to be done by 100,000 men for
over twenty years in 2900 B.C.

21. 2.Classical management theory:
The classical management theory was
introduced during the Industrial Revolution as a
way to improve productivity. The classical theory
developed in three streams- Bureaucracy
(Weber), Administrative Theory (Fayol), and
Scientific Management (Taylor).
3.Neo classical theory — human relations
approach:
Neo-Classical theory gave greater emphasis to
man behind the machine.Neo-Classical approach
may be analysed in three parts, namely — 1.
Hawthorne Experiment 2. Human Relation
Movement 3. Behavioural Approach.

22. 4.Behavioural science approach —
organisational humanism:
The underlying philosophy of organisational
humanism is that integration of knowledge from
other disciplines like psychology, sociology and
anthropology.McGregor, Abraham Maslow and
Fredrick Herzberg.
5.Management science/operational research:
It emphasises research on operations and use
of quantitative techniques to aid
managers to take decisions.
6.Modern management:
It sees modern organisations as complex
systems and use of modern techniques to solve
organisational and human problems.

23. HENRI FAYOL’S PRINCIPLES
OF MANAGEMENT:

24. Henri Fayol,a French management theorist is
popularly known as the Father of Modern general
management. He was born in 1841.He started his
career as engineer in a Coal Mining Company. In 1888
he was promoted as the Managing Director of the
company.
Based largely on his own management experience,
he developed his concept of administration. In 1916
he published these experience in the book
Administration Industrielle et Générale,It was
translated in English as ‘General and Industrial
Management’ in 1949 and is widely considered a
foundational work in classical management theory.

25. Fayol was the first to identify functions
of management-
Plan,Organise,Command, Coordinate
and Control.
Fayol classified Management activities
into6.Technical;Commercial;Financial,S
ecurity;Accounting and Managerial.
Fayol also explained qualities of a
Manger.(Physical,Moral,Education etc)
Fayol concentrated on Top level
Management-(Top -Down Approach)

26. 14 PRINCIPLES OF MANAGEMENT DEVELOPED BY
HENRI FAYOL
1.Division of Work
This principle states that a complex work should be 
divided into small tasks, and each task should be 
assigned to a particular employee..Division of work 
promotes specialization and avoid waste of time and 
effort. This principle is applied to technical as well as 
managerial duties.

27. Authority  is  the  right  to  give  orders  to  the 
subordinates and responsibility is the duty in which 
the  subordinates  are  expected  to  perform.  This 
principle states that authority and responsibility are 
co­existing.
If the authority is granted to a person he should 
also be made responsible. Similarly if anybody is made 
responsible for a task , he should be given sufficient 
authority to perform it.
2.Authority and Responsibility:

28. Discipline is the obedience to organisational 
rules  respect  of  Authority  and  employment 
agreement which are necessary for the working 
of  the  organisation.  It  ensures  the  smooth 
running of the organization and applicable for 
workers and management.
3.Discipline:

29. This principle states that each employee 
should receive orders from one superior only. 
Dual subordination should be avoided. In the 
absence of unity of command, responsibility 
cannot  be  fixed,  duplication  of  work  , 
overlapping  orders  and  instruction    may 
happen.
4.Unity of Command:

30. 5.Unity of Direction:
This principle states that for a group activities 
having the same objective, there should be one 
head  and  one  plan. There  are  different 
departments  in  an  organization  for  different 
activities,Each group of activities having the same 
objective must have one head and one plan.

32. 6.Subordination of Individual Interest 
to General Interest:
An organization is superior to individuals. Each 
individual working in an organization has some 
individual interest. The organization has its own 
objectives. According to Fayol the primary focus is 
on the organizational objectives and not on those 
of the individual.

33. 7.Remuneration of Employees:
  The overall pay and compensation should be 
fair to both employees and the organisation. 
The remuneration should be sufficient to keep 
employees motivated and productive. At the 
same  time  it  should  be  within  the  paying 
capacity of the company.

34. 8.Centralisation and Decentralisation:
Centralisation means concentration of authority 
in few hands at the top level. Decentralisation 
means  delegation  or  distribution  of  authority 
throughout  all  the  levels  of  the  organization. 
There should be a balance between centralization 
and decentralization based on the nature of the 
job.

35. 9.Scalar chain:
Scalar chain refers to ‘the chain of superiors ranking from 
the ultimate authority to the lowest level in an organisation. 
Scalar  chain  is  the  formal  line  of  authority  (Chain  of 
command) which moves from highest to lowest rank.
Drawbacks of Scalar chain:
a)Huge time is required for the communication to reach 
the destination.
b)There is possibility of information distortion.
Gang Plank (Direct Communication):
According to this concept, in case of emergency, two executives
of the organization of different departments at the same level can
communicate directly,

36. 10.Order:
This principle is based on the general saying, 
“Have  a  place  for  everything  and  keep 
everything in its place”. All materials are to 
be kept in proper place (Material Order) and 
the right man is to be assigned the right job 
(Social Order).

37. 11.Equity:
This principle says that superiors should 
be  impartial  while  dealing  with  their 
subordinates.  Equity  refers  to  kind,fair 
and equal treatment for all employees. 
Favouritism  and  nepotism  should  be 
avoided.

38. 12.Stability of tenure of personnel:
 According to Fayol a worker should not be 
moved  from  one  job  to  another  frequently. 
Time is necessary for employee to adapt his 
work  and  perform  it  effectively..  Frequent 
changes of personnel increases cost of selection 
and training .

39. 13.Initiative:
According to this principle , subordinates 
should be given an opportunity to take 
initiative in making and executing the 
plans. Initiative means taking the first 
step with self­motivation.

40. 14.Espirit De Corps (Union is strength):
 This  principle  implies  that  there  should  be 
coordination and team work among the members 
of an organization. Management must take steps 
to develop a sense of belongingness among the 
members of the work group. A manager should 
replace ‘I’ with ‘We’ in all his conversations with 
workers to foster team spirit.

41. From the foregoing discussion it is clear that Fayol’s 14
principles of management are widely applicable to managerial
problems and have cast a profound impact on management
thinking today.

42. F.W.TAYLOR’S SCIENTIFIC MANAGEMENT:
Frederick Winslow Taylor,was born in 1856,
Philadelphia,U.S. was an American engineer who is
known as the father of scientific management.
He started his career as an Engineer in Midvale Steel
Works,Later he became the chief engineer. Taylor
thought that by scientifically analysing work, it would be
possible to find ‘one best way’ to do it. His famous book
“principles and methods of scientific management‘ was
published in 1911.

43. SCIENTIFIC MANAGEMENT- MEANING
AND DEFINITION
Scientific management refers to the
application of science to management
practices. It involves the replacement of rule of
thumb or trial and error method by scientific
and systematic approach in decision making.
“Scientific management means knowing
exactly what you want men to do and seeing
that they do it in the best and cheapest way.”-
Fredrick Winslow Taylor (F.W.Taylor)

44. Objectives of Scientific
management:
1)Increasing production – by the use
of standardized tools, methods
2)Increasing quality – by using
quality control and research.
3)Reducing cost – by using scientific
techniques of production.
4)Reducing wastage – by proper
handling of resources

45. PRINCIPLES OF SCIENTIFIC MANAGEMENT:
1. Science, not rule of thumb :
Rule of thumb means application of traditional
methods or the methods decided by the
managers based on their past experience. All
these methods are often untested and
unscientific; they do not guarantee success.
Through scientific analysis and investigation, the
best method of doing a work can be developed.

46. 2.Harmony, not discord (conflict):
This principle states that there should be
complete harmony between management and the
workers. This can be achieved through a change
in the attitude of workers and the management.
Taylor calls it as “Mental Revolution”.

47. 3.Co-operation, not individualism :
This principle is an extension of “Harmony,
not discord”. This principle states that there
should be complete cooperation between
management and workers instead of
individualism. Competition should be replaced by
cooperation. For all important decisions taken by
the management, workers should be taken into
confidence.

48. 4.Development of each and every person to
his or her greatest efficiency and prosperity:
Industrial efficiency depends to a large extent
on personnel competencies. Under scientific
management right men are selected for right jobs.
The procedure for selection of workers should be
designed scientifically. The management and the
workers should try to achieve maximum output
in the place of restricted output.

50. Mental Revolution
The basic idea behind the principles of
scientific management is to change the mental
attitudes of the workers and the management
towards each other. Taylor called it “mental
revolution”,ie,
Increase in production,
Spirit of mutual trust &
Develop a scientific attitude for solving
problems

51. TECHNIQUES OF SCIENTIFIC MANAGEMENT:
To bring scientific management into practice, Taylor
suggested the following 7 techniques.

52. 1.Functional foremanship:
In this technique Taylor suggested the division
of factory into two departments-Planning
Department and Production Department.
F.W.Taylor suggested that specialization should be
introduced in the factory. He advocated
‘Functional foremanship for this purpose.
Functional foremanship is a form of organization
which involves supervision of a worker by eight
specialist foremen. Each worker will have to take
orders from these eight foremen in the related
process or function of production.
Functional foremanship is an extension of the
principle of division of work and specialisation to
the shop floor.

54. 2. Standardization and simplification of work:
Standardisation involves setting up of standards in
every phases of business operation. It includes uses of
standard tools and equipment., methods or lines of
product, working conditions etc. for maximization of
output. The objectives of standardization are -
a)To establish standards of performance of men and
machines.
b)To maintain quality standards.
c)To reduce a given line or product to fixed types,
sizes and characteristics.

55. 3.Method study:
The objective of method study is to find out one
best way of doing the job. There are various
methods of doing the job. It helps a lot in
handling, transporting and storage of raw
materials and goods. Taylor devised the concept
of assembly line by using method study.
Assembly line:
It is a production process
that breaks the
manufacture of a good
into steps that are
completed in a pre-
defined sequence.

56. 4.Motion study:
Motion study involves close observation of
movements of the workers and machines to
perform a particular job. It helps to eliminate
wasteful movements and to select the best
method of doing a job.
Taylor used stopwatches and various symbols
and colours to identify different motions.

57. 5.Time Study:
It is the determination of time required to
complete a particular study. ie. Fixing standard
time for each job. Time measuring devices are
used for each element of work. The objective of
time study is to determine the number of workers
to be employed, frame suitable incentive schemes
and determine of labour costs.

58. 6.Fatigue study:
Continuous work causes physical or mental
fatigue. Fatigue study tries to identify the amount
and frequency of rest required in completing the
work. Rest pauses and intervals should be
scientifically determined.
WORK STUDY = METHOD STUDY + MOTION STUDY + TIME STUDY + FATIGUE STUDY

59. 7.Differential Piece Rate System:
Differential piece rate system is a system
of wages’ payment in which efficient and
inefficient workers are paid at different rates.
Taylor has suggested two types of wages for
similar work. Higher wages for efficient
workers & lower wages for inefficient
workers.

61. Prepared by:Sandeep Kumar N V
HSST Commerce,Katukukke HSS Kasaragod
Mob:[phone],E
mail:[email protected]
Residence :PILICODE
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62. FAYOL VERSUS TAYLOR COMPARISON
BASIS HENRI FAYOL F W TAYLOR
Emphasis Top level managementLower level
management
ConceptGeneral theory of
administration
Scientific
Management
Unity of
command
Strictly followed Not considered as
important.
Applicabil
ity
Universally applicableApplies to specialized
organizations only.

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Prepared by:Sandeep Kumar N V
HSST Commerce,Katukukke HSS Kasaragod
Mob:[phone],E
mail:[email protected]
Residence :PILICODE