D.M.

ACADEMY CLASSES
ACCOUNTANCY & BUSINESS STUDIES By –Legacy Gupta 9711709697

Meaning: Principles refers to a statement which reflects the fundamental truth about some phenomenon.
Management principles are derived on the basis of observation and analysis of events which managers have to face in
actual practice.

Definition “Principles of management are the guiding rules or laws for managerial action” – H.G. Hicks.

Nature / features of Management Principles:

1. Universal Applicability - Management principles have universal application in all types of organizations and in all places like
business organizations, police force, sports clubs, family etc.

2. General Guidelines – Management principles are derived from experience and analysis and they are in the form of mere
statements. These statements are guidelines for action but not provide solution to all managerial problems.

3. Formed by practice and experimentation: They are developed after thorough research work on the basis of
experiences of managers.

4. Flexible: Which can be adapted and modified by the practicing managers as per the demands of the situations as
they are man-made principles.

5. Mainly Behavioural - Human behavior is unpredictable and it is often situational. This complex human behavior
needs a sense of direction and guidance. Management Principles attempt to provide such guidance in human action.
For instance Team work as a principle is good for attainment of organization goals, but it is a personalized intellectual
task like painting a picture, individual contribution is more valid than teamwork

6. Cause and effect relationship – Cause and effect relationship is indicated by management principles. For example,
the principle “Unity of Command” states that presence of a single boss avoids confusion. Here the presence of Unity of
Command is the cause and avoidance of confusion is the effect

. 7. Contingent - Management Principles are to be applied in accordance with the situation and organizational
requirements, then only it will be successful.

Advantage /Significance of the Principles of Management

1. Providing managers with useful insights into reality: Management principles guide managers to take right decision
at right time by improving their knowledge, ability and understanding of various managerial situations and
circumstances.

2. Optimum Utilization of Resources: Principles of Management point out how time, money, materials and human
efforts can be used economically to improve productivity. This fact can be seen in the principles of division of work,
delegation of authority etc.

3. Scientific Decisions: With the help of Management Principles, managers can take appropriate decisions in right time.

4. Meeting changing environment requirements – Management principles are highly flexible and therefore can be
modified to meet changing requirements of environment.
5. Fulfilling social responsibility: Principles of management not only help in achieving organizational goals but also
guide managers in performing social responsibilities. Example : “Equity” and “Fair” remuneration.

6. Management training, education and research: Management principles are helpful in identifying the areas in which
existing and future managers should be trained. They also provide the basis for future research.
Definition – “Scientific Management means knowing exactly what you want men to do andseeing that
they do it in the best and cheapest way” - F.W.Taylor.

Aims and objectives

1. Increasing production – by the use of standardized tools, methods and devices.

2. Improved quality – by using quality control and research.

3. Reducing cost – by using scientific techniques of production.

4. Selection of right person for right work – by scientific selection and training to workers.

5. Reduction of wastages – by proper handling of resources.

6. Provision of incentive wages – by applying differential piece wage system.

Principles of Scientific Management

Techniques of Scientific Management
Basis Fayol Taylor
1. Nature of He developed the theory of Functional He developed the concept of Scientific
Research management or Management process. management.
His principles are concerned with His principle and techniques are
2. Concern
management efficiency. concerned with workers efficiency.
He designed principles for top level of He designed principles for lower level
3. Level
management. of management.
Improving overall administration by
For him increasing productivity through
4. Focus observing certain principles was his main
work simplification was main focus.
focus.
He developed the personality of a He developed the personality of
5. Personality researcher and practioner and was called scientist and was called as ‘father of
as ‘father of general management. scientific management
He did main contribution was to produce a He provided a basis on
6. Major systematic theory of management with the accomplishment on production line with
contribution help of fourteen principles of general the help of scientific techniques and
management. management.
He gave due emphasis to human elements He ignored the human element and
7. Human
by suggesting principles like equality, emphasized more on increasing
element
initiative, fair remuneration etc. productivity.
He was rigid in his approach and he felt
8. Rigidity and
His principles were flexible. that there should be no deviation from
flexibility
fixed standards.
His principles are applicable to business as His principles are applicable to
9. Applicability well as non-business organizations i.e. are production and manufacturing i.e. are
applicable universally. applicable to specific situations.
10. Unity of He strictly follow this principles i.e. one He did not follow this principle instead
command boss for one employee. he insisted on minimum eight bosses.