HENRY FAYOL "the father of modern operational management theory "

Introduction

Henri Fayol (Istanbul, 29 july 1841 – Paris, 19 novembre 1925) was a French mining engineer, director of mines and management theorist, who developed independent of the Scientific Management a general theory of business administration[1], also known as Fayolism. He was was one of the most influential contributors to modern concepts of management.

Biography

Henri Fayol was born in 1841 in a suburb of Istanbul, Turkey, where his father, an engineer, was appointed superindendent of works to build a bridge over the Golden Horn.[1] They returned to France in 1947. Fayol studied at the mining school "École National Supérieur des Mines" in Saint-Étienne.Nineteen years old he started as an engineer at a mining company "Compagnie de Commentry-Fourchambeau-Decazeville" in Commentry. He became director in 1888, when the mine company employed over 1000 people, and held that position over 30 years until 1918. By 1900 the company was one of the largest producers of iron and steel in France, and regarded as a vital national industry.[1]In 1916 he published his experience in the book "Administration Industrielle et Générale", only a few years after Frederick Winslow Taylor, had published his theory about Scientific Management.

Fayolism

Fayolism is one of the first comprehensive statement of a general theory of management[2], developed by the Fayol. He has proposed that there are five primary functions of management[3]: 1. planning, 2. organizing, 3. commanding, 4. coordinating, and 5. controlling .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)[4] 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.

Publications

Fayol published several articles and some books, books * 1900. Bassins houillers de Commentry et Decazeville, Excursion sous la conduite de M. H. Fayol, 1900. * 1918. Notice sur les travaux scientifiques et techniques, Gauthier Villars, Paris, 1918. * 1921. L’incapacité industrielle de l’État : les PTT, Dunod, 1921. * 1923. La réforme administrative des PTT, tiré à part, Dunod, 1923.

Articles, a selection:

* Fayol H., « Note sur le boisage aux houillères de Commentry (emploi du fer et des bois préparés) », Bulletin de la Société de l’Industrie Minérale, 2e série tome III, 1874, p. 569. * Fayol H., « Guidage des puits de mine », Bulletin de la Société de l’Industrie Minérale, 2e série tome VI, 1877, p. 697. * Fayol H., « Note sur le boisage, le déboisage et le remblayage dans les houillères de Commentry », Comptes rendus mensuels de la Société de l’Industrie Minérale, juin 1878. * Fayol H., « Études sur l'altération et la combustion spontanée de la houille exposée à l'air », Bulletin de la Société de l’Industrie Minérale, congrès de Paris 1878, médaille d'or, 2e série tome VIII, 1878, p. 487-746. * Fayol H., « Étude sur le terrain houiller de Commentry », Comptes rendus des séances de l’Académie des Sciences, 16 mai 1881. * Fayol H., « Sur le terrain houiller de Commentry, Expériences faites pour expliquer la formation », Comptes rendus des séances de l’Académie des Sciences, 30 mai 1881. * Fayol H., « Étude sur le terrain houiller de Commentry, sa formation attribuée à un charriage dans un lac profond », Comptes rendus des séances de l’Académie des Sciences, 20 juin 1881. * Fayol H., « Sur l’origine des troncs d’arbres fossiles perpendiculaires aux strates du terrain houiller », Comptes rendus des séances de l’Académie des Sciences, 18 juillet 1881. * Fayol H., « Note sur la suppression du poste de nuit dans le remblayage des grandes couches », Comptes rendus mensuels de la Société de l’Industrie Minérale, octobre 1882. * Fayol H., « Note sur les mouvements de terrain provoqués par l'exploitation des mines », Bulletin de la Société de l’Industrie Minérale, 2e série tome XIV, 1885, p. 805. * Fayol H., Launay L. de, Meunier S., « Lithologie et stratigraphie, Étude sur le terrain houiller de Commentry », Bulletin de la Société de l’Industrie Minérale, 2° série, tome XV, 1886, réédité en 1887 en ouvrage séparé, tome I de trois portant le titres commun : Études sur le terrain houiller de Commentry. Le volume II (1890) porte le sous titre Flore fossile par Bernard Renault et René Zeiller. Le volume III (1888) porte le sous titre Faune ichtyologique et entomologique, par Charles Brongniart, Émile Sauvage. * Fayol H., « Résumé de la théorie des deltas et histoire de la formation du bassin de Commentry », Bulletin de la Société Géologique de France, août 1888. * Fayol H., « Séance solennelle de clôture du congrès de la Société de l’Industrie Minérale à Paris », samedi 23 juin 1900, Bulletin de la Société de l’Industrie Minérale, N° 15, 1901, p. 759-768. * Fayol H., « Le cinquantenaire de la société Commentry-Fourchambault et Decazeville », Comptes rendus mensuels des réunions de la Société de l’Industrie Minérale, congrès de Saint Étienne, 16 juin 1908, p. 240-242. * Fayol H., « Administration industrielle et générale », Bulletin de la Société de l’Industrie Minérale, N° 10, 1916, p. 5-164. Réédité 13 fois chez Dunod. * Fayol H., « De l’importance de la fonction administrative dans le gouvernement des affaires », conférence faite à la Société d’encouragement pour l’industrie nationale (séance du 24 novembre 1917), Bulletin de la Société de l’Industrie Minérale, N° 12, 1917, p. 225-267. * Fayol H., « Discussion sur l’enseignement technique supérieur », extrait des procès verbaux de la Société des Ingénieurs Civils de France, séance du 30 mars 1917, 16 pages, et Bulletin de la Société de l’Industrie Minérale, N° 12, 1917, p. 272-321. * Fayol H., « Préface à Administration industrielle et générale, l’éveil de l’esprit public », études publiées sous la direction de Henri Fayol, Bulletin de la Société de l’Industrie Minérale, N° 12, 1917, p. 145-152. édité en livre sous le titre L’éveil de l’esprit public chez Dunod et Pinat en 1918. * Fayol H., « La réforme administrative des administrations publiques », Commerce et Industrie, revue pratique des méthodes modernes en affaires, janvier, 1918, p. 3-9. * Fayol H., « L’administration positive dans l’industrie », La Technique Moderne, février, 1918, p. 73-75. * Fayol H., « L’industrialisation de l’État », conférence faite le 24 octobre 1918, Bulletin de la Société de l’Industrie Minérale, N° 15, 1919, p. 237-274. * Fayol H., Préface à l’ouvrage de Albert Schatz L’entreprise gouvernementale et son administration, Grasset, 1922. * Fayol H., Conférence sur l’Administration industrielle et générale, École supérieure de guerre et Centre des Hautes Études Militaires, 5 et 14 mai 1923. * Fayol H., « La doctrine administrative dans l’État », conférence au 2° congrès international de Sciences Administratives, réédité en 1966 dans Revue Internationale des Sciences Administratives, Vol. XXXII, N°2, 1923, p. 114-133. * Fayol H., « Un entretien avec M. Fayol, la gestion des entreprises et l’outillage administratif », signé L. M. du Crouzet, La Chronique Sociale de France, janvier 1925, p. 10-26. * Fayol H., « Note de M. Fayol sur le Rapport présenté par M. André Citroën au nom de la commission chargée d’étudier les questions concernant l’organisation et le fonctionnement du monopole des tabacs et des allumettes », Annexe C du rapport de André Citroën, 1925, p. 163-174..

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. « Prévoyance » (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[1] 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[2] »."

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).