Being addressed as the company officer, many words describe you. You are a supervisor, a leader, and a manager. Certainly you are expected to effectively manage the department’s resources. To be effective as a manager, you should understand what management is and the basic management concepts used in modern organizations.

What Is Management?

Traditionally, management is defined as the activity of getting things done through people. Updating this definition a little, we can say that management is the act of guiding the human and physical resources of an organization to attain the organization’s objectives.

Management involves both the determination of what needs to be done and the accomplishment of the task itself.

From this definition it is clear that managers plan and make decisions about how others will use the organization’s resources. Managers should also be committed to accomplishing these activities efficiently and effectively.

The Beginning of Management  
Possibly the first reference we see to management is contained in the Bible, in Chapter 18 of the book of Exodus:

Jethro noticed that Moses, his son-in-law, spent all of his day serving as judge for his people, while they stood in long illness seeking his advice. “It’s not right! This job is too heavy a burden for you to try to handle all by yourself. You’re going wear yourself and your people out,” Jethro said to Moses at Mount Sinai.

“Let me give you some advice. Teach the decrees and laws. Show your people the way to live and the duties they are to perform. But select capable men from all the people—men who fear God, trust-worthy men who hate dishonest gain—and appoint them as officials over thousands, hundreds, fifties, and tens. Have them serve as judges for the people at all times, but have them bring every difficult case to you; the simple cases they shall decide for themselves. That will make your load lighter because they share it with you.”

Moses followed Jethro’s advice. He chose able men from all over Israel and made them judges. They were constantly able to administer justice over the people in groups: thousands, hundreds, fifties, and tens. They brought the hard cases to Moses but judged the smaller cases themselves.

The Beginning of Modern Management

There is evidence throughout recorded history of the use of management concepts. During the past 100 years, much attention has been focused on the science of management. One of the first contributors was Henry Fayol (1841–1925), a very successful manager of a French coal mine.

In addition to his ongoing management activities, Fayol was interested in understanding the process by which work was accomplished. Fayol’s writings on this topic first appeared in 1900.

By 1916, Fayol had enough material for a book. Though originally published in French, the work was soon translated into English under the title General and Industrial Management. Fayol proposed some fourteen principles of management. Even at this early date, Fayol was concerned about the importance of the human resources in the organization.

As you look at Fayol’s list, you will recognize that some of his principles are related to organizational structure, and some related to the work process itself. Fayol also noted that management activities increase as one moves up in rank in an organization.

Fayol’s 14 Principles of Management

1.   Division of Labor

Divide the work into manageable portions and specialize the activities to improve efficiency. This is what Jethro told Moses to do.

2.   Authority and Responsibility

These terms go hand in hand. Where authority arises, responsibility must follow. Managers must have the authority to make decisions and give directions.

3.   Discipline

Discipline, as a characteristic of authoritarian organizations, includes good leadership and clear agreement between management and labor on the role of each.

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4.   Unity of Command

Unity of command suggests that one should receive orders from oonly one supervisor.

5.   Unity of Direction

Unity of direction suggests that one should receive orders from only one supervisor.

6.   Subordination of Individual Interests

Subordination of individual interests to general interests in an organization suggests that the general interest must take precedence over the individual interests of the members.

7.   Proper Remuneration

Proper remuneration, a fair wage for fair work.

8.   Centralization of Authority

Centralization of authority, like the division of work, brings order to the organization. It provides accountability and responsibility where necessary. However, decentralization (we might think of it more as delegating) usually increases the worker’s importance and value.

9.   Scaler Chain of Ranks

Scaler (continuous) chain of ranks or layers in an organization, and the notion that authority flows from the highest to the lowest ranks in the organization’s chain of command.

10.   Order

Order, or a place for everything and everything in its place, imply Fayol was interested in both material order and social order. Today, we would say that order refers to having the right personnel and the right materials ready to do the job so that employees are effective and efficient.

11.   Equity and Fairness

Equity and fairness are important in the treatment of the employees of any organization.

12.   Initiative

Initiative is important to the organization and its members. The ability to think out a plan and see it through to completion is one of man’s greatest satisfactions.

13.   Stability

Stability of our personnel, recognizing that there is value in a long-term relationship with our employees.

14.   Esprit de Corps

Esprit de corps, an organizational spirit, is essential to the survival of any organization.

Fayol contribution to management cannot be overemphasized. To say that he was ahead of his time would be an understatement: Fayol is called the “Father of Professional Management.” Although Fayol’s ideas were developed a century ago, his ideas are still valid and quite relevant in many organizations today.

Functions of Management

Over the past many decades, Fayol and the other pioneers of management science recognized that management activities of could be broken down into several discrete components: planning, organizing, commanding, coordinating, and controlling.

Important Hint!  

Management activities can be divided into several discrete components: planning, organizing, commanding, coordinating, and controlling.

Over the years, various authors have renamed these activities, and some have repackaged them a bit. However, Fayol’s concept of five basic activities or functions fit our needs here. We’ll spend the remainder of this entry looking closely at Fayol’s five basic functions.

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