A modern re-think of Fayolism

Revision as of 20:14, 6 May 2023

Author: Rejath Ramachandran, s226673

Summary

As a discipline, project management developed from several fields of application, including civil construction, engineering, and heavy defense activity.^[1] Snyder and Kline (1987) note that the modern project management era started in 1958 with the development of CPM/PERT.^[2] Morris (1987) argues that project management originated from the chemical industry just before World War II. However, some literature points the origin of project management to Henry Gantt, called the father of planning and control techniques,^[3] also famous for his namesake, the Gantt chart, and Henri Fayol for his creation of the five managerial functions that form the foundation of the body of knowledge associated with project and program management.^[4] Both Gantt and Fayol were students of Frederick Winslow Taylor's theories of scientific management.

Henri Fayol (1841–1925) was a French philosopher and management theorist. The Industrial Revolution in France inspired Fayol to create a theory which improved project management and created a more efficient workforce. As part of his theory, Fayolism, he also encouraged the administration to use forecasting and planning to minimise workplace misunderstandings. Fayolism was flexible and could be applied to industrial settings, the home, and the government. To increase empathetic relationships at work, Fayol encouraged management and workers to replace workplace memos with verbal forms of communication.

Apart from his five managerial functions, Fayol developed another 14 principles to help managers manage their affairs more effectively. However, as times change, people have begun to interpret these principles quite differently from how they were interpreted during Fayol's time. Through this article, I aim to investigate how Fayolism is changing, given the changing nature of the workplace and the breakdown of traditional roles. Are we now embarking upon a radically different path?

Big Idea

Henri Fayol published his ideas on administration and management (Narayanan & Nath, 1993) almost a century ago based on his experiences in the Mining industry in France (Witzel, 2003). The principles of management are general guidelines that provide a blueprint for decision-making in an organisation. Management principles deal with human behaviour, so it needs to be implemented based on the situation. Human behaviour is ever-changing, and so also are technology, organisational structures, and business strategies. It is believed that every organisation today, in one way or the other, implements Fayol's principles of management. The fourteen principles are as follows (Vlett, 2014):

1. Division of work
2. Authority and responsibility
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination of Individual Interest
7. Remuneration
8. Centralization
9. Scalar chain
10. Order
11. Equity
12. Stability of tenure of personnel
13. Initiative
14. Team-Spirit or Esprit de corps

Fayol's works gained popularity in 1949 (Pugh & Hickson, 2007), and these principles have stood the test of time for almost a century (Pryor & Guthrie, 2010 and Jacqueline, 2011). However, modern organisations have evolved too fast in recent years, rendering the application of some of his principles questionable. Over the last few decades, rapid globalisation has resulted in many changes to the structures, nature of jobs and employees' outlook towards employment. Consequently, employees' perceptions of job security, urbanisation and outsourcing have changed in recent years. Hence this is an attempt to conceptualise some of the changes and their impact on the following tenets of 'Fayolism'.

1. Unity of command: On a different note, multitasking poses challenges in terms of reporting. Consider the organisational structures prevalent in modern companies, where employees are often required to report to functional heads and project managers. This is quite different from Fayol's times (Brunson, 2008). There was a time when the cubicle ruled the roost at the workplace. However, over the past two decades, it has given way to more open office layouts to allow for greater interaction and create a more relaxed, collegial atmosphere. There was another good reason for doing away with the cubicle: with company structures becoming less hierarchical, more linear and more collaborative, there was no need for workers and management to be segregated – the message was this, everyone, even the boss, was accessible at any time.

1. Subordination of individual interest to general interest: In many places, like Japan and Germany, employment was traditionally considered a lifetime affair. The employee would only seek an alternative only if his incumbent company went out of business. Loyalty was then considered critical, and the employees often sacrificed their interests to uphold the organisation's interest. However, the present generation of employees and employers consider the idea of loyalty as behind the times. This is evident from the mass layoffs of 2023. It is as N.R. Narayana Murthy, Infosys Co-founder and the 'Father of the Indian IT Sector' says, "Love your job, but never fall in love with your company".

1. Stability of tenure of personnel: Both retrenchment and job hopping have become part and parcel of today's employment landscape. People are committed to their profession rather than the organisation, so employee turnover is relatively higher. Earlier, people moved for just reasons of compensation. However, their reasons have become multidimensional, often because of company culture or because your life has changed significantly. Organisations have become cost-conscious and wish to retain employees only partially. Even government departments have begun to employ workers on a contract basis to avoid the costs related to increment, EPF and pension. There is no long-term commitment on either side.

1. Remuneration: Terms of employment have changed too, with permanent, pensionable jobs becoming a rarity and the gig economy and contract working becoming the norm.

1. Discipline: In recent years, technology has made people less tied to their desks. With staff working remotely, employees have gained advantages in flexibility, security, and efficiency. Along with these benefits, employees no longer have to wake up at fixed times, prepare properly, and follow routines set at work. This might look antithetical to the factory discipline prevalent in Industrial Revolution Britain and France. The thing to keep in mind here is that you must use something other than this old discipline method in a remote work environment. Therefore, it is up to oneself to work on WFH self-discipline. However, if the past two years have shown anything, it has reassured bosses that remote and hybrid working will not impact their bottom line – in fact, it could vastly improve it.

1. Centralization: For a long time, a hierarchical or centralised organisational structure has been the norm. However, more and more organisations are starting to value more egalitarian organisational landscapes that give more freedom to the employee. This is particularly important since business operations have gone global, and decisions must be made quickly. With the proliferation of startups, non-traditional work arrangements, and accelerators, de-centralisation is becoming more common, even within traditional corporate settings. Such a step helps isolate problems as well as successes. It leads to a positive workplace culture, as employees are empowered to implement ideas and make changes faster that can benefit the company.

1. Initiative: Under this principle, Fayol envisaged management providing from time-to-time creative ideas, skills, and more convenient methods to accomplish tasks. However, as observed by (Robinson, 2005), managers these days cannot take the initiative as they are often preoccupied with other related and unrelated commitments. Nevertheless, in the contemporary age, the staff itself has become an idea house, hence the bedrock of modern organisations. It has been observed in Western countries that group problem-solving systems are patronised against dependence on top-level management as a problem-solving point (Magjuka, 1991 & 1992). However, there must always be processes, procedures and policies to guide employees to ensure successful implementation and prevent abuse of the privilege (Okpara, 2015).

1. Division of work: The operations of present-day organisations are different from how mining operations were carried out a hundred years ago. During the industrialisation revolution era, workers were expected to gain expertise in a trade by repeating the same work over and over again. It was assumed they gained expertise through experience and would take less time to accomplish the same job.

However, the global economy is no longer in that era, and many nations are orienting themselves towards a services-based economy. In a service-based economy, multitasking becomes an essential qualification. Banks are a classic example of this. Graduate programs at some banks ^[5] start with rotations in various departments of related fields. This is done with the hope that students gain a deep understanding of the company, build a network, and are involved in finding a final placement.

The pace at which businesses change has placed a huge demand on employees to learn new skills and be a jack of all trades rather than specialising in one functional area. When typewriters became defunct, the typists had to learn how to use computers. Moreover, with the advent of computers, the erstwhile typists did not just have to type letters but also use them for inventory management, billing, accounting and other purposes. Another example is the post office. Apart from postal services, they offer services like ID card issue/ renewal, utility bill payments, and money transfers. They have partnered with private agencies and government departments to offer a one-stop solution to customers.

Limitations

There are two general criticisms:

1. One is that Fayol's theory was developed based solely on his own managerial experiences, which means he did not undertake any further research. As a result, he could not fully develop a comprehensive understanding of its advantages and disadvantages, believing that his system only produced benefits.
2. Additionally, his principles, although relevant today, are still considered crude today. Nowadays, there is a much greater emphasis on "leadership" than "management". That is also consistent with a knowledge-worker environment.

References

^[6]

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Further reading

• Breeze, John D., and Frederick C. Miner. "Henri Fayol: A New Definition of "Administration"." Academy of Management Proceedings. Vol. 1980. No. 1. Academy of Management, 1980.
• Fayol, Henri, and John Adair Coubrough. Industrial and general administration. (1930).
• Fayol, Henri. General and industrial management. (1954).
• Fayol, Henri. General Principles of Management. (1976).
• Modaff, Daniel P., Sue DeWine, and Jennifer A. Butler. Organizational communication: Foundations, challenges, and misunderstandings. Pearson/Allyn & Bacon, 2008.
• Pearson, Norman M. "Fayolism as the necessary complement of Taylorism." American Political Science Review 39.01 (1945): 68-80.
• Parker, Lee D., and Philip A. Ritson. "Revisiting Fayol: anticipating contemporary management." British Journal of Management 16.3 (2005): 175-194.
• Pugh, Derek S. "Modern organization theory: A psychological and sociological study." Psychological Bulletin 66.4 (1966): 235.
• Reid, Donald. "The genesis of fayolism." Sociologie du travail 28.1 (1986): 75-93.
• Carl A Rodrigues. (2001). "Fayol's 14 principles of management then and now: A framework for managing today's organizations effectively." Management Decision, 39(10), 880-889.
• Wren, Daniel A. "Was Henri Fayol a Real Manager?." Academy of Management Proceedings. Vol. 1990. No. 1. Academy of Management, 1990.