2: General and Industrial Management – H. Fayol’s Theory of Administration

Henri Fayol

Henri Fayol (1841 – 1925) was a French mining engineer and director of mines who developed a general theory of business administration broadly compatible with scientific management of Frederick Winslow Taylor. These two gentlemen are widely acknowledged to have been foundational to modern management theory but, unlike his North American contemporary, Fayol was more concerned with strategy and macro-management. Consequently, he did not devote as much attention to measurement, control and other aspects of scientific management as Taylor did, recognizing instead that organizations consist of people who need to be led and whose activities must be coordinated and organized. Fayol foreshadowed ‘soft’ concepts of management such as esprit de corps, employee initiative and feedback.  In contrast to Taylor’s belief that the design and organization of work were the exclusive province of the technically educated (engineers mainly), Fayol wrote that authority and responsibility derived from one’s position in the organization and not purely technical knowledge. He decried the way engineers were educated at the time, arguing that too much emphasis was placed on mathematics and technical skill that he thought were of limited use managing people. Henri Fayol is best known for his contribution to articulating and establishing the theory of management as we know it today.

For this episode, we are reading part of his central 1916 work, General and Industrial Management (first translated into English in 1929, but not published in the United States until 1949). In this work Fayol clearly outlined the five distinct elements of management and the fourteen principles that he believed should guide managers in administering those elements. In Episode 2 we are concerned with Fayol’s articulation of the 14 principles presented in Chapter 4. Fayol’s description of the principles and their interdependence was one of the earliest formal theories of management and is still one of the most comprehensive. While many of them may seem like common sense, this was not the case 100 years ago, so Fayol is really a prominent figure whom we are keen to discuss. And, as the title for this episode suggests, he repeatedly emphasized that his principles were to guide and not to prescribe (which, let’s face it, is very contemporary!).

Like Chester Barnard (1938) who followed him, Fayol synthesized his theories of management in organizations from his personal experience working in and eventually becoming the director of a mining company that employed around 10,000 people. Fayol believed it was possible to improve efficiency in organizations through better managerial practices. The profundity of his thinking is reflected in that in the Foreword to the 1949 English translation for publication in the U.S., Urwick lamented that the translators used “management” in lieu of Fayol’s term “administration” because of the multiple meanings of the word “management” versus the more precise meaning of “administration,” at least in 1949.

Similar to Taylor, Fayol argued that his flexible approach to management based on general principles could be applied to all kinds of business concerns. Accordingly he stressed the importance (and the practice) of forecasting and planning as key to adapting his ideas and techniques in any sort of situation. Like Taylor, Fayol’s 14 Principles are now considered to be common sense because they are part of a common practice of management. A practice that he was instrumental in establishing. At the time Fayol wrote, they were revolutionary concepts for organizational management. We will explore this further during the Episode.

As noted in the Foreword to the 1949 edition of General and Industrial Management, Fayol was a successful turnaround specialist of his day. When he became the Director of Commentry-Fourchambault in 1888, the company was in serious financial decline. Through application of his ideas and the help of people he had previously trained, Fayol executed a series of restructuring and the company experienced a dramatic reversal of fortune. Because of this success, there was much interest in his ideas in France. Alas, his contributions were largely unknown in the English-speaking countries until 1949, at which point principles such as these were no longer new (33 years later!), which probably explains why he is not as well known as his U.S. counterpart – F.W. Taylor. We hope to rectify that in this, and possibly, another future episode on Henri Fayol.

You may also download the audio files here:  Part 1 | Part 2 | Part 3

Read with us:

Fayol, H. (1949). General and Industrial Management, trans. Constance Storrs. Pitman: London.

We read Part 2, Chapter IV: General Principles of Management. Note: The linked document is of a reprint and therefore the chapter name and pagination differs from the original text.

To Learn More: 

Wren, D.A. and Bedeian, A.G. (2009). The Evolution of Management Thought (6th Ed.), Wiley & Sons: Hoboken, NJ.

See Chapter 10, The Emergence of Management Process and Organization Theory (pp. 211-227).