GMAA - Global Management Analysts Association

Fayolism

Fayolism is one of the first comprehensive statement of a general theory of management, developed by the French management theorist Henri Fayol (1841–1925): one of the most influential contributors to modern concepts of management.

Fayol has proposed that there are five primary functions of management: (1) planning, (2) organizing, (3) commanding, (4) coordinating, and (5) controlling (Fayol, 1949, 1987). Controlling is described in the sense that a manager must receive feedback on a process in order to make necessary adjustments.

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 (2005) have reduced the five functions to four: (1) planning, (2) organizing, (3) leading, and (4) controlling. Daft's text is organized around Fayol's four functions.

The 6 types of Operations

For Fayol any Organisation can be subdivided into 6 types of Operations. Each Operation being fulfilled by its corresponding Essential Function:

  1. Technical Operations (production, manufacturing, transformation)
  2. Commercial Operations (purchases, sales, exchanges)
  3. Financial Operations (seek for capital and finance management)
  4. Security Operations (protection of goods and people)
  5. Accounting Operations (balance, P&L, cost control, statistics, etc)
  6. Administrative Operations (see below The 5 Elements of Administration)

In 1925 six month before Henri Fayol’s death Verney helped Fayol redefine The function of administration (Administration Industrielle et Generale).

The old definition went as follows: The activities involved in businesses can all be classified under one of the following six headings: TECHNICAL, COMMERCIAL, FINANCIAL, SECURITY, ACCOUNTING, ADMINISTRATIVE organization, command, coordination and control). Compared with the new definition: The activities involved in businesses can all be classified under one of the following five headings: TECHNICAL, COMMERCIAL, FINANCIAL, SECURITY, ACCOUNTING These activities must be planned, organized, directed, coordinated and controlled, in a word: administered. The removal of the distinction between management and administration and the re-definition of administration, it appears that Fayol had finally synthesized these two concepts. Therefore the previous difficulties with this distinction no longer exist(Breeze, J., & Miner Jr., F.).

The 9 Levels

Fayol was representing an organisation like a living body (« corps social », ie. "social body") with main organs hierarchically structured as follow:

  1. Shareholders,
  2. Board of Administration,
  3. General Direction and its General staff (advisors),
  4. Regional/local Directions,
  5. Main Engineers,
  6. Services Managers,
  7. Workshops Managers,
  8. Foremen,
  9. Workers.

The 5 Elements of Administration

  1. Departmentalization (to foresee/anticipate and make plans)
  2. Organisation (to provide the Function with all is needed for its smooth running: Supplies, Tools, Funding, Employees)
  3. Commandment (to lead the people employed by the organisation)
  4. Coordination (to harmonise all actions of an Organisation in order to facilitate its smooth running and success)
  5. Control (to verify if everything happens in accordance with defined plans, orders given, and accepted principles)

The word Control clearly provoked some misunderstanding by English-readers because its 1st meaning in French is "to check" and its 2nd meaning is "to have a grip over". And it is the other way round in English. So for the French-reader Fayol clearly meant "Check everything!".

For Fayol, "The Art of Commanding relies upon certain personal qualities and upon the knowledge of management general principles. (...) It has, like all other arts, its degrees. (...) The manager in charge of a commandment must:

  1. have a deep knowledge of his staff;
  2. cull the incapables;
  3. well know the conventions binding the organisation and its members;
  4. give the good example (by his attitude);
  5. conduct regular inspections of the « corps social »;
  6. get together his main partners in conferences (meetings) where are prepared the Unity of Direction and the Focus of Efforts;
  7. not be distracted by details;
  8. aim to make prevalent among his staff, energy, initiative and « dévouement »."

The 14 Principles of Administration

  1. Division of work
  2. Authority
  3. Discipline
  4. Unity of command
  5. Unity of direction
  6. Subordination of Individual Interests to the Common Interest
  7. Remuneration of personnel
  8. Centralisation
  9. Scalar chain
  10. Order
  11. Equity
  12. Stability of personnel tenure
  13. Initiative
  14. Esprit de corps (Union is strength)

Fayol suggested that it is important to have unity of command: a concept that suggests there should be only one supervisor for each person in an organization. Like Socrates, Fayol suggested that management is a universal human activity that applies equally well to the family as it does to the corporation.

The 16 Management Duties of the Organisation

  1. To aim at giving serious thoughts to activity plans and having them firmly executed.
  2. To aim at having employed people and used equipment being relevant to the goal, the resources and the needs of the organisation.
  3. To set up a unique Direction (top management), skilled and vigorous.
  4. To consult others for actions, to coordinate efforts.
  5. To formulate decisions in a clear, clean and precise way.
  6. To aim to an efficient recruitment, each department needing to be lead by a skilled and active man, each employee being at the place where he can provide the most services.
  7. To define clearly the attributions (ie. job description).
  8. To encourage people to take initiatives and responsibilities.
  9. To pay fairly and expertly for the services provided to the Organisation.
  10. to sanction faults and errors.
  11. To enforce discipline.
  12. To aim at having individual interests subordinated to the Organisation's interest.
  13. To give a special attention to the Unity of Command.
  14. To supervise the material order and social order (ie. to keep the place tidy and to avoid strikes).
  15. To verify everything (ie. to apply quality control on every operation).
  16. To fight against the « red ribbon » attitude.

The 7 Qualities

The 7 qualities he was expecting from managers were:

  1. Health and vigour;
  2. Cleverness;
  3. Moral qualities;
  4. General knowledge (culture);
  5. Management capacity;
  6. Notions about other functions (activities);
  7. The strongest skills in the function managed.

For the Top Managing Director, the 7th quality was "the broadest skills in the dedicated activity of the organisation".

For example, if the organisation was a car manufacturer, the top Director must have the largest possible knowledge about the manufacturing of cars. This was suggesting that this Director would have to be probably a former car manufacturing engineer.

Managers need the ability to perform the elements of Management but they also need abilities in the Technical, commercial, financial, security, and Accounting areas of the enterprise. Managerial Ability became more important as he moves up to upper level management. Fayol's ideas inspired a number of individuals to teach and Write about management(Wren).