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Discovering management
Discovering management

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1.1.1 Classical management theory (Fayol and Urwick)

Henri Fayol (1841–1925) is often described as the ‘father’ of modern management. He had been managing director of a large French mining company, and was concerned with efficiency at an organisational level rather than at the level of the task. Drawing on his experience of what worked well in an organisation, he developed a general theory of business administration.

He first broke management down into five distinct elements:

  • forecasting and planning – looking into the future and drawing up action plans
  • organising – building up the material and human structure of the undertaking
  • commanding – maintaining activity amount personnel
  • coordinating – unifying and harmonising activity and effort
  • controlling – ensuring that things conform to rules and instructions

This is a logical, rational and normative analysis of what needs to be done. But this was not a wholly abstract piece of theorising. Fayol was writing on the basis of his own, highly practical experience of management. On the basis of the five elements of management, he then proceeded to identify what he presented as 14 principles for improving managerial effectiveness.

Interestingly, Fayol’s principles share a lot with those of Lyndall Urwick (1891–1983), an army officer turned management consultant, who combined ideas of scientific management and those of classical organisation theory in his writings. Like Fayol, he also came up with a list of general principles for managerial effectiveness. The two writers’ sets of principles are compared here.

General principles of managerial effectiveness

Henri Fayol (1917)

  1. Division of work – specialisation encourages continuous improvement, both in terms of skill and methods.
  2. Authority – the right to give orders and the power to require obedience.
  3. Discipline – a successful organisation requires the shared effort of all staff. Employees must obey, but this is two-sided – they will only comply if management play their part by providing good leadership.
  4. Unit of command – employees should have only one boss with no other conflicting lines of command.
  5. Unity of direction – the entire organisation should be aligned and be moving towards a common goal.
  6. Subordination of individual interests – individual needs and interests should be subordinate to the needs of the organisation.
  7. Remuneration – payment is an important motivator, but should be fair and reward well-directed effort.
  8. Centralisation – an element of centralisation must always be present and is part of the ‘natural order’ in an organisation.
  9. Line of authority – a hierarchy is necessary for unity of direction.
  10. Order – an organisation’s requirements must be balanced against its resources.
  11. Equity – employees must be treated equally and fairly.
  12. Stability of tenure of personnel –employees need a period of stability in a job to perform at their best.
  13. Initiative – encouraging staff to show initiative is a source of strength in an organisation.
  14. Esprit de corps – management should foster harmony, cohesion and morale among the organisation’s staff.

Lyndall Urwick (1943)

  1. The principle of the objective – the overall purpose of an organisation it its raison d'être.
  2. The principle of specialisation – one group, one function.
  3. The principle of coordination – the purpose of organising is to facilitate coordination or unity of effort.
  4. The principle of authority – in every organised group, supreme authority must be located somewhere, and there should be a clear line of authority to every member of the group.
  5. The principle of responsibility – a superior may be held accountable for the actions of subordinates.
  6. The principle of definition – jobs, duties and relationships should be clearly defined.
  7. The principle of correspondence – in every position, responsibility and authority should correspond with one another.
  8. The principle of span of control – no person should supervise more than 5–6 line reports whose work is interlocked.
  9. The principle of balance – it is essential that the various units of an organisation are kept in balance.
  10. The principle of continuity – reorganisation is a continuous process and provision should be made for it.

Stop and reflect

Although many of the above principles have been adopted as good practice for many years by managers in all kinds of organisation, it is less certain whether they are still relevant today given the complexity of the modern manager’s role and the high-paced environment in which most managers now operate. Are the principles timeless or are they now outmoded? How do they fit with your experience of being a manager?