Administrative Management Theory
Administrative management concerns the design and management of an organization. Administrative management theory attempts to find a rational way to design an organization as a whole. Three important theorists are Fayol, James D. Mooney, Max Weber, and Gulick. The Core components of administrative management include the utilization of a formalized administrative structure, a clear division of labor, and delegation of power and authority to administrators relevant to their areas of responsibilities.
Henry Fayol (1840- 1925)
Fayol is a classical management theorist, widely regarded as the father of modern operational management theory. He was trained in the physical sciences (engineering). He began his career as an engineer and later gained experience as a general manager in a coal mining company. From his managerial experiences, he started developing his own ideas for management undertaking. His ideas are a fundamental part of modem management concepts.
As a result, he pioneered the ideas of administrative management theory. Fayol believed that by focusing on managerial practices organizations could minimize misunderstandings and increase efficiency. His writings guided managers on how to accomplish their managerial duties and the practices in which they should engage. In his book “General and Industrial Management” (1929) Fayol outlined his theory of general management, which he believed could be applied to the administration of myriad industries.
He forwarded the functional approach to management thus, classified all the actions of business enterprises into- (i) Technical, (ii) Commercial, (iii) Financial, (iv) Accounting, (v) Security, and (vi) Managerial activities. He sensed managerial activities as the most trifling aspect in business operations therefore he principally focused on the later part of activities. Moreover, he identified the functions or elements of management into five categories; (i) Planning, (ii) Organizing, (iii) Directing, (iv) Coordinating, and (v) Controlling.
He also specified the major skills and qualities of a manager to perform the management functions.
Also Read: Introduction to Evolution of Management Thought
Skills and Qualities of a Manager
a. Physical Qualities:- Health, vigor, manner of behaving, etc
b. Mental Qualities:- Ability to understand, learn, judge and adaptability.
c. Moral Qualities:- Energy, firmness, the willingness of accepting responsibility, initiative, loyalty,
d. General Education:- General Acquaintance with matters belonging to the function performed.
e. Special Knowledge:- Peculiar to the functions of management like; technical, commercial, financial, etc,
f. Work Experience:- Knowledge or recollection of lessons a person has derived from things.
Fayol also developed 14 principles of management in order to help managers manage their affairs more effectively. These principles are exhibited below.
Fayol’s Fourteen Principles of Management
Division of Work:—
When employees are specialized, the output can increase because they become increasingly skilled and efficient.
Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility.
Discipline must be upheld in organizations, but methods for doing so can vary.
Unity of Command:—
Employees should have only one direct supervisor.
Unity of Direction:—
Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated.
Subordination of Individual Interests to the General Interest:—
The interests of one employee should not be allowed to become more important than those of the group. This includes managers.
Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation.
This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance.
Employees should be aware of where they stand in the organization’s hierarchy or chain of command. Fayol developed a channel that allowed communication to cross lines of authority, known as a gangplank. Gangplank is presented below.
The workplace facilities must be clean, tidy, and safe for employees. Everything should have its place.
Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate.
Stability of Tenure of Personnel:—
Managers should strive to minimize employee turnover. Personnel planning should be a priority.
Employees should be given the necessary level of freedom to create and carry out plans.
Esprit de Corps:—
In the given figure ‘E’ can communicate to the ‘O’ strictly traversing the route D – C – B – A – L – M – N. The gangplank presented in the figure (E-O) serves a direct contact at the emergent need.
Max Weber (1864- 1920)
Max Weber, a German economist- sociologist, addressed the more fundamental issue of how organizations should be structured. He pioneered the idea of bureaucracy. He believed bureaucracy really doesn’t exist. It’s merely an ideal or model that can be used in organizing a firm and determining a firm’s performance. However, he envisioned the model as rational and efficient and used his model to describe a pure form of organization, which is formal, impersonal, and governed by rules rather than by people. Weber is also known as the ‘Father of Organization Theory’. He identified some characteristics of bureaucracy such as; division of labour, managerial hierarchy, formal selection of employees, career orientation, and impersonality. These characteristics are shown below:
We make an internet call; get delivered goods and services overnight, granted medicines and almost all the civic amnesties- rests on a bureaucratic model. The theory is the central feature in the modern world.
Characteristics of Bureaucracy Theory
1. Division of labor-
To define authority and responsibility clearly, labor is divided.
2. Managerial hierarchy-
Subordinating positions or offices are organized in an authority hierarchy.
3. Formal selection-
Selection of employees on some certain formal basis and measures.
4. Career orientation-
Employees work in pursuits of career growth therefore they should be well oriented for a career path.
Rules and other controls are impersonal and uniformly applied in all cases.
Chester Irving Barnard (1886 — 1961)
Barnard, an American business executive pioneered the work in management theory and organization studies. His book ‘The Functions of Executive’ (an influential twentieth-century management book) published in 1938 suggested the functions of the executive. They are; establishing and maintaining a system of communication, securing essential services from other members, and formulating organizational purposes. He was the first theorist to elaborate on the importance of the informal organization, and recognize the influence of what is now understood as corporate culture and its associated values and rituals. Barnard emphasized the executive’s important role in maintaining the informal organization through using intangible influence to shape values and promote conformity and self-discipline. He believed that values should be inbuilt and coherent with all the other aspects of the organization to promote organizational success. This is closely related to his acceptance theory of authority since acceptance will be greater where employees believe that actions will contribute to the common organizational goal.
Contributions of Administrative Management Theory
Fayol’s ideas on administrative management were widely accepted. Several writers and management practitioners were greatly influenced by his theory. The list of books and new school of thought got published inspired by his ideas. They are as presented below:
a. Onward Industry, 1931 (revised as Principles of Organization)- James D. Mooney and Alan C. Railey.
b. The Elements of Administration- Colonel L. Urwick
c. Management Process School- Harold Koontz and Cyril O’ Donnell. (This was the new school of thought drawn on inspiration of Fayol’s theory).
Criticism of Administrative Management Theory
Henri Fayol’s management principles and functions are used even today for managing organizations. However, the administrative management theory is criticized on the following grounds:-
1. The administrative management theory is management-oriented. It does not give much attention to the problems of the workers.
2. It does not give any importance to informal organizations or groups. It gives importance only to the formal organization structure.
3. Some of the concepts of this theory are borrowed from military science. They tried to apply these concepts to social and business organizations.
4. The administrative management theory has a mechanical approach. It does not deal with some of the important aspects of management such as motivation, communication, and leading.