Page 1
2
PRINCIPLES OF
MANAGEMENT
CHAPTER
LEARNING
OBJECTIVES
T oyota follows certain well-defined business principles guiding
its functioning. These are:
1. Honour the language and spirit of law of every nation and
undertake open and fair corporate activities to be a good
corporate citizen around the world.
2. Respect the culture and customs of every nation and
contribute to economic and social development through
corporate activities in local communities.
3. To provide clean and safe products and to enhance the
quality of life everywhere.
4. Create and develop advanced technologies and provide
outstanding products and services that fulfil the needs of
customers worldwide.
5. Foster a corporate culture that enhances individual creativity
and teamwork value, while honouring mutual trust and
respect between management and labour.
6. Pursue growth and harmony with global community through
innovative management.
7. Work with business partners in research and creativity to
achieve stable, long-term growth and mutual benefits and be
open to new partnerships. These principles, will guide the
company in its global vision 2010. This global vision envisages
continuous innovations in future, use of environment friendly
technologies, respecting and working with different sections of
society and establishing an interactive relationship with society.
After studying this
chapter, you should
be able to:
n State the
meaning, nature
and significance
of principles of
management;
n Explain Taylor’s
principles and
techniques
of Scientific
Management; and
n Explain Fayol’s
principles of
management.
http://www.toyotaglobal.com/company/history of toyota/
75years/data/conditions/philosophy/guiding principles.html/
It is clear from the foregoing case that
managerial pursuits at Toyota Motor
Corporation are driven by principles
that serve as broad guidelines for
stating the vision as well as the ways
to achieve it. Similarly, many other
business enterprises have followed
various principles in their working
Guiding Principles of T oyota Motor Corporation
Ch_02.indd 30 24-09-2019 12:05:00 PM
Reprint 2024-25
Page 2
2
PRINCIPLES OF
MANAGEMENT
CHAPTER
LEARNING
OBJECTIVES
T oyota follows certain well-defined business principles guiding
its functioning. These are:
1. Honour the language and spirit of law of every nation and
undertake open and fair corporate activities to be a good
corporate citizen around the world.
2. Respect the culture and customs of every nation and
contribute to economic and social development through
corporate activities in local communities.
3. To provide clean and safe products and to enhance the
quality of life everywhere.
4. Create and develop advanced technologies and provide
outstanding products and services that fulfil the needs of
customers worldwide.
5. Foster a corporate culture that enhances individual creativity
and teamwork value, while honouring mutual trust and
respect between management and labour.
6. Pursue growth and harmony with global community through
innovative management.
7. Work with business partners in research and creativity to
achieve stable, long-term growth and mutual benefits and be
open to new partnerships. These principles, will guide the
company in its global vision 2010. This global vision envisages
continuous innovations in future, use of environment friendly
technologies, respecting and working with different sections of
society and establishing an interactive relationship with society.
After studying this
chapter, you should
be able to:
n State the
meaning, nature
and significance
of principles of
management;
n Explain Taylor’s
principles and
techniques
of Scientific
Management; and
n Explain Fayol’s
principles of
management.
http://www.toyotaglobal.com/company/history of toyota/
75years/data/conditions/philosophy/guiding principles.html/
It is clear from the foregoing case that
managerial pursuits at Toyota Motor
Corporation are driven by principles
that serve as broad guidelines for
stating the vision as well as the ways
to achieve it. Similarly, many other
business enterprises have followed
various principles in their working
Guiding Principles of T oyota Motor Corporation
Ch_02.indd 30 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 31
over a period of time. A number of
management thinkers, and writers
have also studied principles of
management from time-to-time.
In fact, there is a long history of
management thought. Management
principles have evolved and are in
the continuous process of evolution.
(see box.)
You can see that the evolution of
management thought has been very
fascinating. In this chapter we will
study the contributions of Fredrick
Winslow Taylor and Henri Fayol who
as you have read are associated with
the classical management theory.
Both of them contributed immensely
towards the study of management as
a discipline. Whereas F.W. Taylor was
an American mechanical engineer,
Henri Fayol was a French mining
engineer. Taylor gave the concept
In tracing the history of management, one comes across various schools of thought
that have outlined principles to guide management practices. These schools of
thought may be divided into 6 distinctive phases: 1 . Early Perspectives; 2. Classical
Management Theory; 3. Neo Classical Theory — Human Relations Approach;
4. Behavioural Science Approach — Organisational Humanism; 5. Management
Science/Operational Research; 6. Modern Management.
EARLY PERSPECTIVES
The first known management ideas were recorded in 3000-4000 B.C. One
Pyramid built by Egyptian ruler Cheops required work to be done by 100,000
men for over twenty years in 2900 B.C. It covered 13 acres of land and measured
481 meters in height. The stone slabs had to be moved thousands of kilometres
of distance. As folklore goes, even the sound of a hammer was not heard in the
villages in the vicinity of the site of these pyramids. Such monumental work could
not be completed without adherence to principles of sound management.
CLASSICAL MANAGEMENT THEORY
Rational economic view, scientific management, administrative principles, and
bureaucratic organisation characterise this phase. While the rational economic
view assumed that people are motivated by economic gains primarily; scientific
management of F .W . Taylor and others emphasised one best way of production
etc; administrative theorists personified by Henri Fayol etc looked at the best
way to combine jobs and people into an efficient organisation; bureaucratic
organisation theorists led by Max Weber looked at ways to eliminate managerial
inconsistencies due to abuse of power which contributed to ineffectiveness.
This was the era of the industrial revolution and factory system of production.
Large scale production would not have been possible without adherence to
the principles governing organising production based on division of labour and
specialisation, relationship between man and the machine, managing people
and so on.
Evolution of Management Principles
Ch_02.indd 31 24-09-2019 12:05:00 PM
Reprint 2024-25
Page 3
2
PRINCIPLES OF
MANAGEMENT
CHAPTER
LEARNING
OBJECTIVES
T oyota follows certain well-defined business principles guiding
its functioning. These are:
1. Honour the language and spirit of law of every nation and
undertake open and fair corporate activities to be a good
corporate citizen around the world.
2. Respect the culture and customs of every nation and
contribute to economic and social development through
corporate activities in local communities.
3. To provide clean and safe products and to enhance the
quality of life everywhere.
4. Create and develop advanced technologies and provide
outstanding products and services that fulfil the needs of
customers worldwide.
5. Foster a corporate culture that enhances individual creativity
and teamwork value, while honouring mutual trust and
respect between management and labour.
6. Pursue growth and harmony with global community through
innovative management.
7. Work with business partners in research and creativity to
achieve stable, long-term growth and mutual benefits and be
open to new partnerships. These principles, will guide the
company in its global vision 2010. This global vision envisages
continuous innovations in future, use of environment friendly
technologies, respecting and working with different sections of
society and establishing an interactive relationship with society.
After studying this
chapter, you should
be able to:
n State the
meaning, nature
and significance
of principles of
management;
n Explain Taylor’s
principles and
techniques
of Scientific
Management; and
n Explain Fayol’s
principles of
management.
http://www.toyotaglobal.com/company/history of toyota/
75years/data/conditions/philosophy/guiding principles.html/
It is clear from the foregoing case that
managerial pursuits at Toyota Motor
Corporation are driven by principles
that serve as broad guidelines for
stating the vision as well as the ways
to achieve it. Similarly, many other
business enterprises have followed
various principles in their working
Guiding Principles of T oyota Motor Corporation
Ch_02.indd 30 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 31
over a period of time. A number of
management thinkers, and writers
have also studied principles of
management from time-to-time.
In fact, there is a long history of
management thought. Management
principles have evolved and are in
the continuous process of evolution.
(see box.)
You can see that the evolution of
management thought has been very
fascinating. In this chapter we will
study the contributions of Fredrick
Winslow Taylor and Henri Fayol who
as you have read are associated with
the classical management theory.
Both of them contributed immensely
towards the study of management as
a discipline. Whereas F.W. Taylor was
an American mechanical engineer,
Henri Fayol was a French mining
engineer. Taylor gave the concept
In tracing the history of management, one comes across various schools of thought
that have outlined principles to guide management practices. These schools of
thought may be divided into 6 distinctive phases: 1 . Early Perspectives; 2. Classical
Management Theory; 3. Neo Classical Theory — Human Relations Approach;
4. Behavioural Science Approach — Organisational Humanism; 5. Management
Science/Operational Research; 6. Modern Management.
EARLY PERSPECTIVES
The first known management ideas were recorded in 3000-4000 B.C. One
Pyramid built by Egyptian ruler Cheops required work to be done by 100,000
men for over twenty years in 2900 B.C. It covered 13 acres of land and measured
481 meters in height. The stone slabs had to be moved thousands of kilometres
of distance. As folklore goes, even the sound of a hammer was not heard in the
villages in the vicinity of the site of these pyramids. Such monumental work could
not be completed without adherence to principles of sound management.
CLASSICAL MANAGEMENT THEORY
Rational economic view, scientific management, administrative principles, and
bureaucratic organisation characterise this phase. While the rational economic
view assumed that people are motivated by economic gains primarily; scientific
management of F .W . Taylor and others emphasised one best way of production
etc; administrative theorists personified by Henri Fayol etc looked at the best
way to combine jobs and people into an efficient organisation; bureaucratic
organisation theorists led by Max Weber looked at ways to eliminate managerial
inconsistencies due to abuse of power which contributed to ineffectiveness.
This was the era of the industrial revolution and factory system of production.
Large scale production would not have been possible without adherence to
the principles governing organising production based on division of labour and
specialisation, relationship between man and the machine, managing people
and so on.
Evolution of Management Principles
Ch_02.indd 31 24-09-2019 12:05:00 PM
Reprint 2024-25
32 Business Studies
of ‘Scientific Management’ whereas
Fayol emphasised ‘Administrative
Principles’.
But before we go into the details
of their contributions let us study
the meaning of the principles of
management.
Princi Ples of Manage Ment :
t he c once Pt A managerial principle is a broad
and general guideline for decision-
making and behaviour. For example
while deciding about promotion of an
employee one manager may consider
seniority, whereas the other may
follow the principle of merit.
One may distinguish principles
of management from those of pure
science. Management principles are
not as rigid as principles of pure
science. They deal with human
behaviour and, thus, are to be
applied creatively given the demands
of the situation. Human behaviour is
never static and so also technology,
which affects business. Hence all
the principles have to keep pace
with these changes. For example,
in the absence of Information and
NEO CLASSICAL THEORY — HUMAN RELATIONS APPROACH
This school of thought developed between 1920s to 1950s felt that employees
simply do not respond rationally to rules, chains of authority and economic
incentives alone but are also guided by social needs, drives and attitudes.
Hawthorne Studies at GEC etc., were conducted then. It was quite natural that
in the early phases of the industrial revolution, the emphasis was on development
of techniques and technology. The attention to the human factor was the salient
aspect of this school of thought. This attention was to serve as a precursor to the
development of behavioural sciences.
BEHAVIOURAL SCIENCE APPROACH — ORGANISATIONAL HUMANISM
Organisational behaviourists like Chris Argyris; Douglas McGregor, Abraham
Maslow and Fredrick Herzberg used the knowledge of psychology, sociology
and anthropology to develop this approach. The underlying philosophy of
organisational humanism is that individuals need to use all of their capacities and
creative skills at work as well as at home.
MANAGEMENT SCIENCE/OPERATIONAL RESEARCH
It emphasises research on operations and use of quantitative techniques to aid
managers to take decisions.
MODERN MANAGEMENT
It sees modern organisations as complex systems and underlies contingency
approach and use of modern techniques to solve organisational and human
problems.
Source: Adapted from Internet modern history source book on www.fordham.edu
Ch_02.indd 32 24-09-2019 12:05:00 PM
Reprint 2024-25
Page 4
2
PRINCIPLES OF
MANAGEMENT
CHAPTER
LEARNING
OBJECTIVES
T oyota follows certain well-defined business principles guiding
its functioning. These are:
1. Honour the language and spirit of law of every nation and
undertake open and fair corporate activities to be a good
corporate citizen around the world.
2. Respect the culture and customs of every nation and
contribute to economic and social development through
corporate activities in local communities.
3. To provide clean and safe products and to enhance the
quality of life everywhere.
4. Create and develop advanced technologies and provide
outstanding products and services that fulfil the needs of
customers worldwide.
5. Foster a corporate culture that enhances individual creativity
and teamwork value, while honouring mutual trust and
respect between management and labour.
6. Pursue growth and harmony with global community through
innovative management.
7. Work with business partners in research and creativity to
achieve stable, long-term growth and mutual benefits and be
open to new partnerships. These principles, will guide the
company in its global vision 2010. This global vision envisages
continuous innovations in future, use of environment friendly
technologies, respecting and working with different sections of
society and establishing an interactive relationship with society.
After studying this
chapter, you should
be able to:
n State the
meaning, nature
and significance
of principles of
management;
n Explain Taylor’s
principles and
techniques
of Scientific
Management; and
n Explain Fayol’s
principles of
management.
http://www.toyotaglobal.com/company/history of toyota/
75years/data/conditions/philosophy/guiding principles.html/
It is clear from the foregoing case that
managerial pursuits at Toyota Motor
Corporation are driven by principles
that serve as broad guidelines for
stating the vision as well as the ways
to achieve it. Similarly, many other
business enterprises have followed
various principles in their working
Guiding Principles of T oyota Motor Corporation
Ch_02.indd 30 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 31
over a period of time. A number of
management thinkers, and writers
have also studied principles of
management from time-to-time.
In fact, there is a long history of
management thought. Management
principles have evolved and are in
the continuous process of evolution.
(see box.)
You can see that the evolution of
management thought has been very
fascinating. In this chapter we will
study the contributions of Fredrick
Winslow Taylor and Henri Fayol who
as you have read are associated with
the classical management theory.
Both of them contributed immensely
towards the study of management as
a discipline. Whereas F.W. Taylor was
an American mechanical engineer,
Henri Fayol was a French mining
engineer. Taylor gave the concept
In tracing the history of management, one comes across various schools of thought
that have outlined principles to guide management practices. These schools of
thought may be divided into 6 distinctive phases: 1 . Early Perspectives; 2. Classical
Management Theory; 3. Neo Classical Theory — Human Relations Approach;
4. Behavioural Science Approach — Organisational Humanism; 5. Management
Science/Operational Research; 6. Modern Management.
EARLY PERSPECTIVES
The first known management ideas were recorded in 3000-4000 B.C. One
Pyramid built by Egyptian ruler Cheops required work to be done by 100,000
men for over twenty years in 2900 B.C. It covered 13 acres of land and measured
481 meters in height. The stone slabs had to be moved thousands of kilometres
of distance. As folklore goes, even the sound of a hammer was not heard in the
villages in the vicinity of the site of these pyramids. Such monumental work could
not be completed without adherence to principles of sound management.
CLASSICAL MANAGEMENT THEORY
Rational economic view, scientific management, administrative principles, and
bureaucratic organisation characterise this phase. While the rational economic
view assumed that people are motivated by economic gains primarily; scientific
management of F .W . Taylor and others emphasised one best way of production
etc; administrative theorists personified by Henri Fayol etc looked at the best
way to combine jobs and people into an efficient organisation; bureaucratic
organisation theorists led by Max Weber looked at ways to eliminate managerial
inconsistencies due to abuse of power which contributed to ineffectiveness.
This was the era of the industrial revolution and factory system of production.
Large scale production would not have been possible without adherence to
the principles governing organising production based on division of labour and
specialisation, relationship between man and the machine, managing people
and so on.
Evolution of Management Principles
Ch_02.indd 31 24-09-2019 12:05:00 PM
Reprint 2024-25
32 Business Studies
of ‘Scientific Management’ whereas
Fayol emphasised ‘Administrative
Principles’.
But before we go into the details
of their contributions let us study
the meaning of the principles of
management.
Princi Ples of Manage Ment :
t he c once Pt A managerial principle is a broad
and general guideline for decision-
making and behaviour. For example
while deciding about promotion of an
employee one manager may consider
seniority, whereas the other may
follow the principle of merit.
One may distinguish principles
of management from those of pure
science. Management principles are
not as rigid as principles of pure
science. They deal with human
behaviour and, thus, are to be
applied creatively given the demands
of the situation. Human behaviour is
never static and so also technology,
which affects business. Hence all
the principles have to keep pace
with these changes. For example,
in the absence of Information and
NEO CLASSICAL THEORY — HUMAN RELATIONS APPROACH
This school of thought developed between 1920s to 1950s felt that employees
simply do not respond rationally to rules, chains of authority and economic
incentives alone but are also guided by social needs, drives and attitudes.
Hawthorne Studies at GEC etc., were conducted then. It was quite natural that
in the early phases of the industrial revolution, the emphasis was on development
of techniques and technology. The attention to the human factor was the salient
aspect of this school of thought. This attention was to serve as a precursor to the
development of behavioural sciences.
BEHAVIOURAL SCIENCE APPROACH — ORGANISATIONAL HUMANISM
Organisational behaviourists like Chris Argyris; Douglas McGregor, Abraham
Maslow and Fredrick Herzberg used the knowledge of psychology, sociology
and anthropology to develop this approach. The underlying philosophy of
organisational humanism is that individuals need to use all of their capacities and
creative skills at work as well as at home.
MANAGEMENT SCIENCE/OPERATIONAL RESEARCH
It emphasises research on operations and use of quantitative techniques to aid
managers to take decisions.
MODERN MANAGEMENT
It sees modern organisations as complex systems and underlies contingency
approach and use of modern techniques to solve organisational and human
problems.
Source: Adapted from Internet modern history source book on www.fordham.edu
Ch_02.indd 32 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 33
Communications Technology (ICT), a
manager could oversee only a small
work force that too within a narrow
geographical space. The advent of
ICT has expanded the capability of
the managers to preside over large
business empires spread across
the globe. Infosys headquarters in
Bangalore boast of the Asia’s largest
flat screen in their conference room
from where their managers can
interact with their employees and
customers in all parts of the world.
In developing an understanding
of the meaning of principles of
management, it is also useful to
know what these are not. The
principles of management should
be distinguished from techniques
of management. Techniques are
procedures or methods, which
involve a series of steps to be taken to
accomplish desired goals. Principles
are guidelines to take decisions or
actions while practicing techniques.
Likewise, principles should also be
understood as being distinct from
values. Values are something, which
are acceptable or desirable. They
have moral connotations. Principles
are basic truths or guidelines for
behaviour. Values are general rules
for behaviour of individuals in society
formed through common practice
whereas principles of management
are formed after research in work
situations, which are technical in
nature. However, while practicing
principles of management values
cannot be neglected, as businesses
have to fulfil social and ethical
responsibilities towards society.
n ature of Princi Ples of
Manage Ment By nature is meant qualities and
characteristics of anything. Principles
are general propositions, which are
applicable when certain conditions
are present. These have been
developed on the basis of observation
and experimentation as well as
personal experiences of the managers.
Depending upon how they are
derived and how effective they are in
explaining and predicting managerial
behaviour, they contribute towards
the development of management both
as a science and as an art. Derivation
of these principles may be said to be
a matter of science and their creative
application may be regarded as an
art. These principles lend credibility
of a learnable and teachable discipline
to the practice of management. As
such, ascent to managerial position
may not be a matter of birth, but a
matter of requisite qualifications.
Clearly, management principles have
gained importance with increasing
professionalisation of management.
These principles are guidelines
to action. They denote a cause and
effect relationship. While functions
of management viz., Planning,
Organising, Staffing, Directing and
Controlling are the actions to be
Ch_02.indd 33 24-09-2019 12:05:00 PM
Reprint 2024-25
Page 5
2
PRINCIPLES OF
MANAGEMENT
CHAPTER
LEARNING
OBJECTIVES
T oyota follows certain well-defined business principles guiding
its functioning. These are:
1. Honour the language and spirit of law of every nation and
undertake open and fair corporate activities to be a good
corporate citizen around the world.
2. Respect the culture and customs of every nation and
contribute to economic and social development through
corporate activities in local communities.
3. To provide clean and safe products and to enhance the
quality of life everywhere.
4. Create and develop advanced technologies and provide
outstanding products and services that fulfil the needs of
customers worldwide.
5. Foster a corporate culture that enhances individual creativity
and teamwork value, while honouring mutual trust and
respect between management and labour.
6. Pursue growth and harmony with global community through
innovative management.
7. Work with business partners in research and creativity to
achieve stable, long-term growth and mutual benefits and be
open to new partnerships. These principles, will guide the
company in its global vision 2010. This global vision envisages
continuous innovations in future, use of environment friendly
technologies, respecting and working with different sections of
society and establishing an interactive relationship with society.
After studying this
chapter, you should
be able to:
n State the
meaning, nature
and significance
of principles of
management;
n Explain Taylor’s
principles and
techniques
of Scientific
Management; and
n Explain Fayol’s
principles of
management.
http://www.toyotaglobal.com/company/history of toyota/
75years/data/conditions/philosophy/guiding principles.html/
It is clear from the foregoing case that
managerial pursuits at Toyota Motor
Corporation are driven by principles
that serve as broad guidelines for
stating the vision as well as the ways
to achieve it. Similarly, many other
business enterprises have followed
various principles in their working
Guiding Principles of T oyota Motor Corporation
Ch_02.indd 30 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 31
over a period of time. A number of
management thinkers, and writers
have also studied principles of
management from time-to-time.
In fact, there is a long history of
management thought. Management
principles have evolved and are in
the continuous process of evolution.
(see box.)
You can see that the evolution of
management thought has been very
fascinating. In this chapter we will
study the contributions of Fredrick
Winslow Taylor and Henri Fayol who
as you have read are associated with
the classical management theory.
Both of them contributed immensely
towards the study of management as
a discipline. Whereas F.W. Taylor was
an American mechanical engineer,
Henri Fayol was a French mining
engineer. Taylor gave the concept
In tracing the history of management, one comes across various schools of thought
that have outlined principles to guide management practices. These schools of
thought may be divided into 6 distinctive phases: 1 . Early Perspectives; 2. Classical
Management Theory; 3. Neo Classical Theory — Human Relations Approach;
4. Behavioural Science Approach — Organisational Humanism; 5. Management
Science/Operational Research; 6. Modern Management.
EARLY PERSPECTIVES
The first known management ideas were recorded in 3000-4000 B.C. One
Pyramid built by Egyptian ruler Cheops required work to be done by 100,000
men for over twenty years in 2900 B.C. It covered 13 acres of land and measured
481 meters in height. The stone slabs had to be moved thousands of kilometres
of distance. As folklore goes, even the sound of a hammer was not heard in the
villages in the vicinity of the site of these pyramids. Such monumental work could
not be completed without adherence to principles of sound management.
CLASSICAL MANAGEMENT THEORY
Rational economic view, scientific management, administrative principles, and
bureaucratic organisation characterise this phase. While the rational economic
view assumed that people are motivated by economic gains primarily; scientific
management of F .W . Taylor and others emphasised one best way of production
etc; administrative theorists personified by Henri Fayol etc looked at the best
way to combine jobs and people into an efficient organisation; bureaucratic
organisation theorists led by Max Weber looked at ways to eliminate managerial
inconsistencies due to abuse of power which contributed to ineffectiveness.
This was the era of the industrial revolution and factory system of production.
Large scale production would not have been possible without adherence to
the principles governing organising production based on division of labour and
specialisation, relationship between man and the machine, managing people
and so on.
Evolution of Management Principles
Ch_02.indd 31 24-09-2019 12:05:00 PM
Reprint 2024-25
32 Business Studies
of ‘Scientific Management’ whereas
Fayol emphasised ‘Administrative
Principles’.
But before we go into the details
of their contributions let us study
the meaning of the principles of
management.
Princi Ples of Manage Ment :
t he c once Pt A managerial principle is a broad
and general guideline for decision-
making and behaviour. For example
while deciding about promotion of an
employee one manager may consider
seniority, whereas the other may
follow the principle of merit.
One may distinguish principles
of management from those of pure
science. Management principles are
not as rigid as principles of pure
science. They deal with human
behaviour and, thus, are to be
applied creatively given the demands
of the situation. Human behaviour is
never static and so also technology,
which affects business. Hence all
the principles have to keep pace
with these changes. For example,
in the absence of Information and
NEO CLASSICAL THEORY — HUMAN RELATIONS APPROACH
This school of thought developed between 1920s to 1950s felt that employees
simply do not respond rationally to rules, chains of authority and economic
incentives alone but are also guided by social needs, drives and attitudes.
Hawthorne Studies at GEC etc., were conducted then. It was quite natural that
in the early phases of the industrial revolution, the emphasis was on development
of techniques and technology. The attention to the human factor was the salient
aspect of this school of thought. This attention was to serve as a precursor to the
development of behavioural sciences.
BEHAVIOURAL SCIENCE APPROACH — ORGANISATIONAL HUMANISM
Organisational behaviourists like Chris Argyris; Douglas McGregor, Abraham
Maslow and Fredrick Herzberg used the knowledge of psychology, sociology
and anthropology to develop this approach. The underlying philosophy of
organisational humanism is that individuals need to use all of their capacities and
creative skills at work as well as at home.
MANAGEMENT SCIENCE/OPERATIONAL RESEARCH
It emphasises research on operations and use of quantitative techniques to aid
managers to take decisions.
MODERN MANAGEMENT
It sees modern organisations as complex systems and underlies contingency
approach and use of modern techniques to solve organisational and human
problems.
Source: Adapted from Internet modern history source book on www.fordham.edu
Ch_02.indd 32 24-09-2019 12:05:00 PM
Reprint 2024-25
Principles of Management 33
Communications Technology (ICT), a
manager could oversee only a small
work force that too within a narrow
geographical space. The advent of
ICT has expanded the capability of
the managers to preside over large
business empires spread across
the globe. Infosys headquarters in
Bangalore boast of the Asia’s largest
flat screen in their conference room
from where their managers can
interact with their employees and
customers in all parts of the world.
In developing an understanding
of the meaning of principles of
management, it is also useful to
know what these are not. The
principles of management should
be distinguished from techniques
of management. Techniques are
procedures or methods, which
involve a series of steps to be taken to
accomplish desired goals. Principles
are guidelines to take decisions or
actions while practicing techniques.
Likewise, principles should also be
understood as being distinct from
values. Values are something, which
are acceptable or desirable. They
have moral connotations. Principles
are basic truths or guidelines for
behaviour. Values are general rules
for behaviour of individuals in society
formed through common practice
whereas principles of management
are formed after research in work
situations, which are technical in
nature. However, while practicing
principles of management values
cannot be neglected, as businesses
have to fulfil social and ethical
responsibilities towards society.
n ature of Princi Ples of
Manage Ment By nature is meant qualities and
characteristics of anything. Principles
are general propositions, which are
applicable when certain conditions
are present. These have been
developed on the basis of observation
and experimentation as well as
personal experiences of the managers.
Depending upon how they are
derived and how effective they are in
explaining and predicting managerial
behaviour, they contribute towards
the development of management both
as a science and as an art. Derivation
of these principles may be said to be
a matter of science and their creative
application may be regarded as an
art. These principles lend credibility
of a learnable and teachable discipline
to the practice of management. As
such, ascent to managerial position
may not be a matter of birth, but a
matter of requisite qualifications.
Clearly, management principles have
gained importance with increasing
professionalisation of management.
These principles are guidelines
to action. They denote a cause and
effect relationship. While functions
of management viz., Planning,
Organising, Staffing, Directing and
Controlling are the actions to be
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34 Business Studies
taken while practising management,
Principles help managers to take
decisions while performing these
functions. The following points
summarise the nature of principles
of management.
(i) Universal applicability: The
principles of management are
intended to apply to all types of
organisations, business as well as
non-business, small as well large,
public sector as well as private
sector, manufacturing as well as
the services sectors. However,
the extent of their applicability
would vary with the nature of the
organisation, business activity,
scale of operations and the like. For
example, for greater productivity,
work should be divided into small
tasks and each employee should
be trained to perform his/her
specialised job. This principle is
applicable to a government office
where there is a diary/despatch
clerk whose job is to receive and
send mail or documents, a data
entry operator whose task is to
input data on the computer, a peon
and an officer etc. This principle
is also applicable to a limited
company where there are separate
departments like Production,
Finance, Marketing and Research
and Development etc. Extent of
division of work, however, may
vary from case to case.
(ii) General guidelines: The prin-
ciples are guidelines to action
but do not provide readymade,
straitjacket solutions to all
managerial problems. This
is so because real business
situations are very complex
and dynamic and are a result
of many factors. However, the
importance of principles cannot
be underestimated because even
a small guideline helps to solve
a given problem. For example,
in dealing with a situation
of conflict between two
departments, a manager may
emphasise the primacy of the
overall goals of the organisation.
(iii) Formed by practice and experi
mentation: The principles
of management are formed
by experience and collective
wisdom of managers as well as
experimentation. For example, it
is a matter of common experience
that discipline is indispensable
for accomplishing any purpose.
This principle finds mention
in management theory. On the
other hand, in order to remedy
the problem of fatigue of workers
in the factory, an experiment
may be conducted to see the
effect of improvement of physical
conditions to reduce stress.
(iv) Flexibile: The principles of
management are not rigid
prescriptions, which have to be
followed absolutely. They are
flexible and can be modified by
the manager when the situation
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