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Unit 2: Evolution of Management Thought

approach. Henri Fayol is regarded as the father of this school. Henri Fayol defined management Notes
in terms of certain functions and then laid down fourteen principles of management which
according to him have universal applicability.

Did u know? Henri Fayol was a French executive who emphasized that management could
be both taught and learnt. His long practical experience is reflected in his paper.
“Administration industrielle et generale” (General and Industrial Management). Fayol
tried to develop a theory of management. He discussed the principles of general
management and argued that managerial ability can be acquired as any other technical
ability. He not only recommended formal teaching in management but also practised it
by founding the Centre for Administrative Studies in Paris. Thus, he was a pioneer in the
field of management education. In brief, Fayol’s views on management command
acceptability even today because they are much in tune with the requirements of the
management in the present-day world.

Principles of Management (Contribution of Henry Fayol)

Henry Fayol was born in 1941 at Constantinople in France.

Did u know? He graduated as a mining engineer in 1860 from the National School of
Mining. After his graduation, he joined a French Coal Mining Company as an Engineer.
After a couple of years, he was promoted as manager. He was appointed as General
Manager of his company in 1888. At that time, the company suffered heavy losses and was
nearly bankrupt. Henry Fayol succeeded in converting his company from near bankruptcy
to a strong financial position and a record of profits and dividends over a long period.
Concept of Management: Henry Fayol is considered the father of modern theory of general and
industrial management. He divided general and industrial management into six groups:
1. Technical activities: Production, manufacture, adaptation.
2. Commercial activities: Buying, selling and exchange.
3. Financial activities: Search for and optimum use of capital.

4. Security activities: Protection of property and persons.
5. Accounting activities: Stock-taking, balance sheet, cost, and statistics.
6. Managerial activities: Planning, organisation, command, co- ordination and control.
These six functions had to be performed to operate successfully any kind of business. He, however,
pointed out that the last function i.e., ability to manage, was the most important for upper levels
of managers.
The process of management as an ongoing managerial cycle involving planning, organising,
directing, co-ordination, and controlling, is actually based on the analysis of general management
by Fayol. Hence, it is said that Fayol established the pattern of management thought and practice.
Even today, management process has general recognition.
Fayol’s Principles of Management: The principles of management are given below:
1. Division of work: Division of work or specialization alone can give maximum productivity
and efficiency. Both technical and managerial activities can be performed in the best
manner only through division of labour and specialization.

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