ADMINISTRATIVE MANAGEMENT

 Administrative Management
 is the study of how to create an organizational
structure and control system that leads to high
efficiency and effectiveness.
 is the process of managing information through
people. This usually involves performing the
storage and distribution of information to
those within an organization.
ADMINISTRATIVE MANAGEMENT

 Represent top level management pertaining

thinking and planning functions.
 It performs the function of formulation of
vision, mission and strategies.
ADMINISTRATIVE MANAGEMENT

• Administrative management was developed in

1st half of the 20th century.
• Henri Fayol, Luther Gulick, Lyndall Urwick, James
D. Mooney have contributed to establish
administrative management.
 Administrative Management
(James D. Mooney)

 In 1931, Mooney and Raily wrote “onward

industry” which republished 1939 as “the
principles of organization”. The principles
form the basis for efficient functioning to
the organization
 Administrative Management
(Luther Gulick & Lyndal Urwick)

 Gulick and Urwick wrote in 1937 “paper

on the science of administration”. In this
paper they stretched on the importance
of structure of organization in
determining function.
HENRI FAYOL(1841- 1925)

Henri Fayol was a French mining engineer.

Later he turned out to be a leading industrial and
successful manager.
He has long been acknowledged as a founding “Father
of the Classical Management School of Thought.”
He wrote a monograph in French in 1916 titled
“General and Industrial Administration”.
HENRI FAYOL (1841- 1925)

 He is considered as the "Father of

Administrative Management Theory."
 Developed a general theory of business
administration that is often called Fayolism.
 Fayolism - a theory of management that analyzed and
synthesized the role of management in organizations.
HENRI FAYOL (1841- 1925)

• Firstly, Fayol is credited with the belief that

organizational and business life was an amalgam
of six (6) activities of an industrial undertakings.
• Secondly, Fayol identified five (5) key
functions or elements that comprised
managerial activity.
• Finally, Fayol advocated fourteen (14)
principles designed to guide the
successful manager.
HENRI FAYOL :
SIX MANAGEMERIAL ACTIVITIES
Production, manufacture,
Technical Activities
adaptation

Commercial Activities Buying, selling exchange

Search for and optimum use of
Financial Activities
capital
Security activities Protection of property and persons
Stock-taking, balance sheet, costs,
Accounting Activities
statistics
Planning, organizing, commanding,
Managerial Activities
coordinating and controlling
HENRI FAYOL :
FIVE ELEMENTS OF MANAGEMENTS

Fayol classifies the key functions of

management into Five (5) Main Elements:
a) Planning: Forethought to the operation of an
organization. Experience, Unity, continuity,
flexibility, precision are features of Good Planning.
b)Organizing: Material organization and human
organization (leadership, organizational
structure).
c) Commanding: Rests on certain personal qualities
and knowledge of general management.
HENRI FAYOL :
FIVE ELEMENTS OF MANAGEMENTS

d)Coordinating: Coordinating by integrating

subordinates and keeping balance among
material, social and functional parts.
e) Controlling: Verifying whether activities take place
in conformity with the plan adopted, instructions
issued and principles established.
 14 Principles of Management

 Division of Work
 Authority and Responsibility
 Discipline
 Unity of Command
 Unity of Direction
 Subordination of Individual Interest to General
Interest
 Remuneration
 14 Principles of Management

 Centralization
 Scalar Chain
 Equity
 Order
 Stability of Tenure of Personnel
 Initiative
 Esprit de Corps
 Division of Work

Work should be divided among individuals and

groups.
When employees are specialized, output can increase
because they become increasingly skilled and
efficient.
It produces more and better work with the same
effort.
Fayol said that work specialization is the best way to
use the human resources of the organization.
 Authority and Responsibility

 Authority was defined by Fayol as the right to give

orders and the power to exact obedience.
Responsibility involves being accountable, and is
therefore naturally associated with authority.
 Managers must have the authority to give orders,
but they must also keep in mind that with authority
comes responsibility.
 Responsibility is closely related to authority and it
arises wherever authority is exercised.
 Discipline

 Discipline means obedience to authority, observance

of the rules and norms of performance, respect for
agreements, sincere efforts for completing the given
job, respect for the superiors and the organization,
etc.
 The best means of maintaining discipline are good
supervisors at all levels, clear and fair agreements
between the employees and the employer, and
judicious application of penalties.
 Unity of Command

 Each employee should receive instructions

about a particular work from one superior
only.
 If there were to be more than one superiors,
the employee would be confused due to
conflict in instructions.
 Unity of Direction

 Teams with the same objective should be

working under the direction of one manager,
using one plan.
 Fayol advocates "One head and one plan"
which means that group efforts on a
particular plan be led and directed by a single
person.
 This enables effective co-ordination
of individual efforts and energy.
 Subordination of Individual Interest to
General Interest

 First priority to general intrest.

 An individual is always interested in maximizing his
own satisfaction through more money, recognition,
status, etc. It is very often against the general interest
of the organisation.
 The interests of one employee should not be allowed
to become more important than those of the group.
 Fair Remuneration to Employees

 According to Fayol wage-rates and method

of their payment should be fair, proper
and satisfactory.
 Fair remuneration increases workers’ efficiency
and boost their morale.
 It also plays a vital role in making the relations of
the employees and the management better.
 Centralization & Decentralization

 Fayol defined centralization as lowering the role and

importance of the subordinate role.
 Decentralization is increasing the importance of
subordinate.
 According to Fayol should be proper and effective
adjustment between centralization and
decentralization inorder to achieve maximum
objectives of the business.
 Scalar Chain

 Scalar chain is the formal line of

authority which moves from
highest to lowest rank in a straight
line. This chain specifies the route
through which the information is
to be communicated to the
desired location/person.
 Fayol emphasized that every information in the
organization must flow according to this chain to
facilitate clear communication of orders of the
superiors and feelings of the subordinates.
 It consumes a lot of time to pass information.
 Order

 “right place for everything and right man at

right place”
 There should be proper, systematic and orderly
arrangement of physical and social factors, such
as land, raw materials, tools and equipments and
employees respectively.
 There should be an orderliness in work
through suitable organization of men and
materials.
 Equity

Management should treat all its employees as

equally as possible.
Managers should be free from all prejudices,
personal likes or dislikes.
It ensures healthy industrial relations between
management and labour.
This will create loyalty and devotion among the
employees.
 Stability of Tenure of Personnel

Workers should be assured of the security of job

by the management.
This is important to motivate them and extract
better work from them.
If they fear for job security, their morale will be
low and they cannot give efficient work.
Also, they will not have any sense of attachment
to the organization and they will always be on
the lookout for a job elsewhere.
 Initiative

 Under this principle, the successful management

provides an opportunity to its employees to
suggest their new ideas,experiences and more
convenient methods of work
 Employees should be given the necessary level
of freedom to create and carry out plans.
 Employees should be encouraged to make all
kinds of suggestions to conceive and carry out
their plans.
 Esprit de Corps

 This term means team spirit.

 Harmony and unity among the employees is a
great source of strength to the organization.
 To achieve this, the motto of divide and rule should
be avoided. And, verbal communication should be
used for removing misunderstandings.
 Thank you!
CARBONELL, JR., Bayani Ilagan

Reference: slideshare.com