ACKNOWLEDGEMENT

On the very outset of this report. I would like to extend my sincere & heartfelt obligation

towards all the personages who have helped me in this endeavour. Without their active

guidance, help, cooperation & encouragement, I would not have made headway in the

project.

I am extremely thankful and pay my gratitude to my faculty guide ‘AKASH SIR’ for his

valuable guidance and support on completion of this project in its presently.

I extend my gratitude to ‘MUNICIPAL COLLEGE ROURKELA’ for giving me this

opportunity.

I also acknowledge with a deep sense of reverence, my gratitude towards my parents and

member of my family, who has always supported me morally as well as economically.

At last but not least gratitude goes to all of my friends who directly or indirectly helped me to

complete this project report.

Any omission in this brief acknowledgement does not mean lack of gratitude.

Thanking you

PIYUSH MISHRA

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 CERTIFICATE

DEPARTMENT OF COMMERCE

This is to certify that PIYUSH MISHRA, student of class XII has successfully completed the

research on the project ‘PRINCIPLES OF MANAGEMENT’ he has taken proper care and

shown utmost sincerity in completing this project under the guidance of ‘AKASH SIR’

during the year 2021-2023.

Signature of the guide Signature of external examiner

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TABLE OF CONTENTS

ABSTRACT...............................................................................................................................4

INTRODUCTION......................................................................................................................5

WHAT ARE THE PRINCIPLES OF MANAGEMENT...........................................................6

IMPORTANCE OF UNDERSTANDING PRINCIPLES OF MANAGEMENT.....................7

FEATURES OF PRINCIPLES OF MANAGEMENT..............................................................9

HENRY FAYOL’S PRINCIPLE OF MANAGEMENT.........................................................12

NATURE OF PRINCIPLES OF MANAGEMENT................................................................15

THE SIGNIFICANCE OF PRINCIPLES OF MANAGEMENT............................................17

DIFFERENCE BETWEEN VALUE AND PRINCIPLES OF MANAGEMENT..................18

PRINCIPLES OF SCEINTIFIC MANAGEMENT.................................................................19

CONCLUSION........................................................................................................................20

REFERENCE...........................................................................................................................21

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 ABSTRACT

The fundamental principles of management, as well as the practice of their application in

industrial production sphere are described in the article in detail. The author gives an idea of

the managerial principles evolution in an enterprise-type organization (both in our country

and abroad). Special attention is paid to the managerial culture formation theory and its

influence on the entrepreneurial and strategic management combination. The main idea of the

presented work is an evolutionary approach to effective management principles classification

in relation to business activities carried out within self-organizing micro-level systems. Their

developmental gene, as shown in the work, is the management culture, its formation is the

subject of this study. The study research area is management science issues and its cognition

methods development: developmental factors and managerial principles of an enterprise-type

organization. There are so many approaches to integrate individual goals with overall goals.

The most comprehensive approach is Management by Objectives (MBO). It is an approach

to effective management through achievement of goals. In the management by objectives, the

goals and standards are fixed after having discussed with managers at various levels, which

secures integration of organizational goals with individual goals. Supreme managers assume

responsibilities for performance of subordinates. Subordinates are allowed to exercise self-

direction and self-control to a great extent. Management by objectives also provides for

extensive participation by all managers in all important matters of the organization. All this

provides scope for development of creative abilities of individuals.

INTRODUCTION

Management is the art and science of managing others. Knowledge of management will help

you identify and develop the skills to better manage your career, relationships, and the

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behaviour of others in organizations. A manager’s primary challenge is to solve problems

creatively, and management the art and science of accomplishing individual and

organizational goals through the efforts of individuals and groups using planning, organizing,

leading, and controlling. Often refers to “the art of getting things done through the efforts of

other people.” The principles of management The concepts managers use in an effort to

accomplish management goals., then, are the means by which you actually manage, that is,

get things done through others—individually, in groups, or in organizations. Formally

defined, the principles of management are the activities that “plan, organize, and control the

operations of the basic elements of [people], materials, machines, methods, money and

markets, providing direction and coordination, and giving leadership to human efforts, so as

to achieve the sought objectives of the enterprise.” For this reason, principles of management

are often discussed and learned using a framework called P-O-L-C, which stands for

planning, organizing, leading, and controlling. While managers do not necessarily spend all

their time managing, the managerial function is required in all aspects of organizations.

Everyone employed in an organization is affected by management principles, processes,

policies, and practices as one is either a manager or a subordinate to a manager, and usually

both. Consequently, finding a “way to do it better” is a challenge that helps all individuals to

meet their personal and professional goals.

WHAT ARE THE PRINCIPLES OF MANAGEMENT

The organisational principle is the great and overall direction for determining the

performance. For instance, while ascertaining about the promotion of an employee, a

manager may contemplate seniority, whereas the other may follow the principle of quality.

One may define principles of management from those of pure science. Management

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principles are not as firm as postulates of pure science. They deal with human traits and,

hence, are to be employed creatively given the requirements of the position. Human

behaviour is never inactive and so also technology, which business. Therefore all the

principles have to keep step with these changes. For instance,

 In the absenteeism of Information and Communications Technology (ICT), a manager

could manage only a small workforce that too within a restricted geographical area.

 The approach of ICT has developed the ability of the managers to control over large

business domains scattered across the globe.

 In promoting an understanding of the application of principles of management, it is

also helpful to comprehend what these are not.

 The principles of management should be selected from techniques of management.

Techniques are methods or techniques, which include a group of steps to be taken to

achieve sought goals.

 Principles are guidelines to make judgements or actions while studying techniques.

Moreover, principles should also be comprehended as being different from values.

IMPORTANCE OF UNDERSTANDING PRINCIPLES OF

MANAGEMENT

(1) Providing Managers with Useful Insights Into Reality

 The application of principles of management helps the managers to take right

decisions at the right time.

 These principles of management help managers to tackle the diverse problems in a

dynamic business environment.

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(2) Optimum Utilisation of Resources & Effective Administration

 Resources are always scarce and limited.

 By applying the management principles, the managers can focus on optimum use of

available resources so as to achieve productive results at minimum cost and maximum

profits.

 It results in effective administration by channelizing resources (human and material)

into the best possible way.

(3) Scientific Decisions

 Application of principles of management makes the manager more realistic,

thoughtful, justifiable and free from personal bias.

 The decisions taken on the basis of principles of management are subject to

evaluation and objective assessment.

(4) Meeting Changing Business Environment

 Although the principles are in the nature of general guidelines, they are modified and

help managers to meet the changing requirements of the environment.

Example:

With the rapid rise of online market sellers, offline vendors have also started selling their

goods on online platforms.

(5) Fulfilling Social Responsibility

 Principles of management not only help in achieving the goals of the organisation

effectively and efficiently, but they also guide the managers to fulfil their

commitment towards its employees and society.

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Example:

Principles of fair remuneration and equity ensure social justice to employees and compliance

with government norms towards corporate social responsibility which improves the

company’s image in the society.

(6) Management Training, Education and Research

 Proper understanding of principles is the base of training, research and development

in the field of management.

 Management is taught on the basis of these principles, which help the management

institutes prepare future managers.

 These Principles help managers to take decisions and actions in the right manner.

 Application of these principles by the managers brings innovation in the field of

management.

Example:

It is the result of such training, education and research that Sunil Mittal could run Airtel in a

successful way.

FEATURES OF PRINCIPLES OF MANAGEMENT

(1) General Guidelines

 The principles of management are just for a prescription.

 They do not provide any ready-made solutions to all sorts of problems being faced by

the organisations.

 These can be modified as per the nature of the situation and human behaviour.

Example:

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During the period of recession, the general manager may allow marketing departments to

give away heavy discount to the customers without giving due attention to financial losses

being raised by the financing department because the primacy of overall goals of the

organisation is important.

(2) Universal Validity

 Principles of management can be applied to any kind of organisation whether it is

private or government, not for profit organisation, small, medium, large organisation

etc.

 But their applicability depends upon nature, size of the organisation and different

situations.

Example: The whole work of an organisation is divided into smaller tasks, and such tasks are

assigned to different departments, groups and individuals. Such a system of division of work

is applicable in all types of organisations.

(3) Formed by Practice and Experimentation

 The principles of management have been formed by experience and acquired the

wisdom of managers over the years.

Example: Through collective practice, we can see that Fayol’s Principle-Discipline helps in

increasing productivity.

Taylor’s Principle-Science, Not Rule of Thumb, brings out uniformity and

standardisation in the manufacturing process of a company. ( we can give the same example

which we have given in the case study because at this stage Fayol’s principle and Taylor

principle are not yet discussed)

(4) Contingent

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  As the application of principles of management depends upon prevailing situations

and needs, so their results may not be uniform as expected.

Example:

 Remuneration of employees should be just and equitable, yet it may vary from person

to person depending upon various situations.

 Remuneration can be dependent on:

 Industrial standard.

 Employer’s paying capacity.

 Contribution of employee etc.,

(5) Flexible

 The principles of management are general prescriptions not rigid.

 The managers can make certain changes as per the convenience and requirement of a

situation.

Example:

Application of the principle of centralisation or decentralisation i.e. concentration or dispersal

of authority to be delegated to employees depends upon the need, ability and competency of

the employees. It also depends upon the nature of the organisation.

(6) Based on Cause and Effect

 The principles of management are intended to establish cause and effect relationship

so that the findings can be applied to such given situations frequently.

 The principles of management tell the likely effect if a certain principle is applied.

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  The effect of such principles remains more or less the same due to their application on

human behaviour.

Example:

By applying the principle of subordination of individual interest to the general interest, the

behaviour of employees may be influenced in such a way that the personal goals of

employees may be directed towards goals of the organisation.

(7) Mainly Behavioural

 The principles of management aim at influencing the behaviour of employees.

 With the help of principles of management, the managers try to bring desired changes

in the behaviour of employees so as to achieve the organisational goals.

Example:

Orderliness decides behaviour among human beings in a company. Even the behaviour

between men and machine can be decided by this principle of Management

HENRY FAYOL’S PRINCIPLE OF MANAGEMENT

Henry Fayol, also known as the ‘father of modern management theory’ gave a new

perception of the concept of management. He introduced a general theory that can be applied

to all levels of management and every department. The Fayol theory is practised by the

managers to organize and regulate the internal activities of an organization. He concentrated

on accomplishing managerial efficiency.

The fourteen principles of management created by Henri Fayol are explained below.

1. Division of Work-

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Henri believed that segregating work in the workforce amongst the worker will enhance the

quality of the product. Similarly, he also concluded that the division of work improves the

productivity, efficiency, accuracy and speed of the workers. This principle is appropriate for

both the managerial as well as a technical work level.

2. Authority and Responsibility-

These are the two key aspects of management. Authority facilitates the management to work

efficiently, and responsibility makes them responsible for the work done under their guidance

or leadership.

3. Discipline-

Without discipline, nothing can be accomplished. It is the core value for any project or any

management. Good performance and sensible interrelation make the management job easy

and comprehensive. Employees good behaviour also helps them smoothly build and progress

in their professional careers.

4. Unity of Command-

This means an employee should have only one boss and follow his command. If an employee

has to follow more than one boss, there begins a conflict of interest and can create confusion.

5. Unity of Direction-

Whoever is engaged in the same activity should have a unified goal. This means all the

person working in a company should have one goal and motive which will make the work

easier and achieve the set goal easily.

6. Subordination of Individual Interest-

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This indicates a company should work unitedly towards the interest of a company rather than

personal interest. Be subordinate to the purposes of an organization. This refers to the whole

chain of command in a company.

7. Remuneration-

This plays an important role in motivating the workers of a company. Remuneration can be

monetary or non-monetary. However, it should be according to an individual’s efforts they

have made.

8. Centralization-

In any company, the management or any authority responsible for the decision-making

process should be neutral. However, this depends on the size of an organization. Henri Fayol

stressed on the point that there should be a balance between the hierarchy and division of

power.

9. Scalar Chain-

Fayol on this principle highlights that the hierarchy steps should be from the top to the

lowest. This is necessary so that every employee knows their immediate senior also they

should be able to contact any, if needed.

10. Order-

A company should maintain a well-defined work order to have a favourable work culture.

The positive atmosphere in the workplace will boost more positive productivity.

11. Equity-

All employees should be treated equally and respectfully. It’s the responsibility of a manager

that no employees face discrimination.

12. Stability-

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An employee delivers the best if they feel secure in their job. It is the duty of the management

to offer job security to their employees.

13. Initiative-

The management should support and encourage the employees to take initiatives in an

organization. It will help them to increase their interest and make then worth.

14. Esprit de Corps-

It is the responsibility of the management to motivate their employees and be supportive of

each other regularly. Developing trust and mutual understanding will lead to a positive

outcome and work environment.

This 14 principles of management are used to manage an organization and are beneficial for

prediction, planning, decision-making, organization and process management, control and

coordination.

NATURE OF PRINCIPLES OF MANAGEMENT

By nature is intended conditions and aspects. Principles are universal declarations, which are

appropriate when specific circumstances are present. These have been explained on the

principle of research and trial and error as well as the personal backgrounds of the managers.

The following points sum the nature of the principles of management:

1. Universal relevance:

Principles of management are expected to employ to all types of establishments, the industry

as well as non-industry, small as well large, private sector as well as the public sector,

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production as well as the services divisions. However, the scope of their applicability would

diversify with the nature of the industry, business activity, scale of operations etc.,

Example: The whole work of an organisation is divided into smaller tasks and such tasks are

assigned to different departments, groups and individuals. Such a system of division of work

is applicable in all types of organisations.

2. General rules:

The laws are the regulations to work but do not give readymade, simple clarifications to all

administrative issues. This is so because real-time business conditions are difficult and

powerful and are a consequence of many factors.

Example: During the period of recession, the general manager may allow marketing

departments to give a heavy discount to the customers without giving due attention to

financial losses being raised by the financing department because the primacy of overall

goals of the organisation is important.

3. Formed by practice and trial and error method:

The principles of management are determined by wisdom and accumulated knowledge of

managers as well as experimentation. For instance, it is a subject of current knowledge that

the system is necessary for achieving any goal. This principle gains name in the management

system.

Example: Through collective practice, we can see that Fayol’s Principle-Discipline helps in

increasing productivity.

Taylor’s Principle-Science, Not Rule of Thumb, brings out uniformity and standardization

in the manufacturing process of a company. ( we can give the same example which we have

15
given in the case study because at this stage Fayol’s principle and Taylor principle are not yet

discussed)

4. Contingent:

As the application of principles of management depends upon prevailing situations and

needs, so their results may not be uniform as expected.

Example: Remuneration of employees should be just and equitable yet it may vary from

person to person depending upon various situations.

Remuneration can be dependent on:

 Industrial standard.

 Employer’s paying capacity.

 Contribution of employee etc.,

5. Flexible:

The principles of management are general prescriptions not rigid. The managers can make

certain changes as per the convenience and requirement of a situation.

Example: Application of the principle of centralisation or decentralisation i.e. concentration

or dispersal of authority to be delegated to employees depends upon the need, ability and

competency of the employees. It also depends upon the nature of the organisation.

6. Based on Cause and Effect:

The principles of management are intended to establish cause and effect relationship so that

the findings can be applied to such given situations frequently. The principles of management

tell the likely effect if a certain principle is applied. The effect of such principles remains

more or less the same due to their application on human.

16
Example: By applying the principle of subordination of individual interest to the general

interest, the behaviour of employees may be influenced in such a way that the personal goals

of employees may be directed towards goals of the organisation.

THE SIGNIFICANCE OF PRINCIPLES OF MANAGEMENT

The significance of principles of management can be discussed in terms of the following

points:

 Providing managers with useful insights into reality: The principles of

management present the managers with valuable insights into real-world

circumstances. Adherence to these policies will supplement their education, capability

and perception of managerial conditions and circumstances.

 Optimum utilisation of resources and efficient management: Both material and

human resources are obtainable with the firm are restricted. They have to be placed to

best use. By the best utilisation, the resources must be put to utilisation in such a way

that they should give the most profit with minimum cost. Principles provide the

managers to predict and influence relationships of their choices and activities.

DIFFERENCE BETWEEN VALUE AND PRINCIPLES OF

MANAGEMENT

Parameters Values Principles of Management

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 Definition Values are acceptable or desirable in Principles of management are broad and

society. They touch the moral general guidelines for decision making and

aspects of life. behaviour.

Example Honesty, Sincerity etc. Division of work, discipline etc.

Nature Developed in society. Developed and applied in business.

Status General rules for behaviour. Basic truths or guidelines.

Formation Formed through common practice Formed after research at the workplace.

PRINCIPLES OF SCEINTIFIC MANAGEMENT

Frederick Winslow Taylor mentioned core principles of management in his Principles of

Scientific Management book. These principles refer to the scientific management theory by

Taylor. Such as:-

1. Science, not the Rule of Thumb: The basic principles of scientific management theory by

Taylor are the adoption of a scientific approach to decision making. Even abandons the all

unscientific approach from managerial activities. So, we can say that these principles suggest

thinking before doing.

2. Harmony, not Discord: An organization constitutes by two groups i.e. ‘workers’ and

‘management’. They must create the ‘Give and Take’ relationship in the workplace.

Therefore, Taylor emphasized on Mental Revolution which means a change of attitude of

both groups based on this principle. They should share the opinions and ideas of each other.

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3. Co-operation, not Individualism: It shows the importance of each other (management and

workers). Management should reward and appreciate the employees for their helpful

suggestions. At the same time, employees also cooperate with the management for the

improvement of the organization.

4. Development of Each and Every Person to his/her Greatest Efficiency and Prosperity:

Employees should be properly trained and selected in a scientific manner. And it is essential

for each organization. For implementing this task, Taylor arranged some techniques, for

instance, work-study, time study, motion study, fatigue study and method study.

5. Maximum, not Restricted Output: Maximum productivity is the basic purpose of an

organization. In this case, Taylor has emphasized the production maximization in his

principles.

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 CONCLUSION

As a conclusion, Management is creative problem solving. This creative problem solving is

accomplished through four functions of management: planning, organising, leading and

controlling. The intended result is the use of an organisation’s resources in a way that

accomplishes its mission and objectives. Planning is the first function and also the most

important function. This is because without a plan, there is no method or direction in an

organisation. Planning is preparing a sequence of action steps to achieve some specific goal.

If you do it effectively, you can reduce much the necessary time and effort of achieving the

goal. The important of planning involves like defining organization goals, establish strategies

to achieve goals, and develop plans to integrate and coordinate work activities.As the

principles of management are not as exact as the principles of pure science, so it may be

called-an inexact science. The prominence of human factor in the management makes it a

Social Science. Management does not fulfil all the features of a profession and thus it is not a

full-fledged profession because anybody can proclaim to be a manager; prescribed

compulsory educational degree or license is not required. Besides there are not any formal

ethical codes which are required to be observed.

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 REFERENCE

RK.SHARMA: BUSIESS STUDIES AND MANAGEMENT

SHASHI K.GUPTA, RAHUL SHARMA

BUSINESS STUDIES

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