Administrative Management: Meaning, Principles, Theory & Advantages

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Administrative Management theory tries to find a rational way to design an organization as a whole. This theory formulates administrative structure, a clear division of labor, and delegation of authority to administrators relevant to their areas of responsibilities.

► What is Administrative Management?

Administrative Management is a term worried about planning and dealing with the entire design of an association. It includes observing the everyday exercises of association for guaranteeing continuous congruity in the present high-speed climate.

Authoritative administration is a managerial hypothesis that spotlights on making a formalized regulatory construction, fostering an appropriate ordered progression of power, choosing their critical capacities and obligations, and legitimate division of work inside the association.

It is an extremely key capacity for every association that empowers the board of data through people groups. Authoritative supervisors watch out for data streams inside the association so all assets are effectively used for better usefulness.

The Administrative Theory of Management was first summed up by Henri Fayol (1841-1925) with his work and distributions, Fayol’s 14 Principles of Management (1888), and General and Industrial Management (1916).

Henry Fayol is known as the father of Administrative Management Theory, frequently called Process Theory or Structure Theory.

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► Principles of Administrative management

Henry Fayol’s greatest contribution is considered to be his theory of management principles and elements. He gave 14 principles of management in his Administrative theory.

14 Principles of Management

Let’s discuss all these 14 principles of management.

✔ 1. Division of work (management principles)

  • Specialization of work and department increases output by making employees more efficient for the organization.
  • This division of work can be applied at all managerial levels of the organization.

✔ 2. Authority and Responsibility

  • Managers must be able to give orders to their subordinates, and authority gives them this right.
  • Henri Fayol finds authority as a continuation of official and personal or individual factors.
  • Official Authority is derived from the position of a managerial role and personal authority is derived from personal qualities such as intelligence, knowledge, and experience.
  • Responsibility arises out of the assignment of activity.
  • In order to discharge the responsibility properly, there should be uniformity of authority and responsibility.

✔ 3. Principle of Discipline

  • Employees should be disciplined; they must obey and respect the rules that govern the organization.
  • Discipline may be of two types. Self-imposed and command discipline.
  • Self-imposed discipline springs from within the individual. It is in the nature of the spontaneous response to a skillful leader.
  • Command discipline comes from a recognized authority. This ensures compliance with the desired action by established customs, rules, and regulations of the organization.

✔ 4. Unity of command

  • principle of Unity of command states that one employee should receive orders from one boss only. More than one superior can not give an order to an employee at a time.
  • More specifically an individual has a reporting relationship to a single superior or boss.
  • This makes the problem of conflict in instructions very less. It also increases the feeling of personal responsibility for results.

✔ 5. Unity of direction

  • The organization should have a single plan of action to guide managers and all the workers.
  • Unity of direction provides better coordination among various activities in different departments to be undertaken by an organization.

✔ 6. Subordination of individual interests to the general/common interest

  • Common organizational interest is above the individual interest of an employee.
  • The personal interests of any employee should not take precedence over the interests of the business organization as a whole.
  • Ambition, laziness, weakness, etc., are factors that reduce the importance of general interest.
  • There should be constant vigilance and supervision to maintain agreement between employers and employees.

✔ 7. Remuneration (14 principles of Management)

  • The principle of remunerations simply means that employees and workers must be paid a fair salary or wage for their services.
  • Remuneration of employees should provide maximum possible satisfaction to employees and employers.

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✔ 8. Centralization

  • Centralization is a term used to refer to the degree to which subordinates are involved in decision-making.
  • If the importance of a subordinate’s role is increasing then it is known as decentralization. And when his importance is reducing then it is called centralization.
  • Centralization is very common in small firms but in large firms, a series of intermediaries and conciliators are required.

✔ 9. Scalar Chain

  • This line of authority from top management to the lowest position is the scalar chain.
  • There should be a scaler chain of authority and communication on every level of management from the highest to the lowest.
  • It is important that communication must flow systematically through each level and position in the line of authority.

✔ 10. Order (14 administrative management principle)

  • People and materials (Human resources) should be in the right place at the right time.
  • This kind of order demands precise knowledge of the human requirement and resources of the organization and a constant balance between these requirements and resources.
  • Normally, the bigger the size of the organization, the more difficult this balance is.

✔ 11. Equity (14 management principles)

  • Every Manager should be kind and fair to their subordinates.
  • Equity is known as the combination of justice and kindness.
  • The application of equity requires optimistic thinking, experience, and good nature for soliciting loyalty and devotion from subordinates.

✔ 12. Stability of tenure of personnel

  • Management should provide orderly human resource planning and ensure that replacements are available to fill vacancies whenever required.
  • No employees should be removed within a short time. There should be reasonable security of a job role.
  • Stability of tenure of personnel is very important to get new employees accustomed to new work and attain set standard performance.
  • Unnecessary turnover of employees is both cause and effect of bad management.

✔ 13. Initiative (14 principles of Management)

  • Employees should be allowed to innovate ideas and plans and it requires high levels of effort to make this happen.
  • Managers should encourage their employees for taking initiative in group meetings within the limits of authority and discipline. The initiative is concerned with thinking out and executing a plan.

✔ 14. Esprit de corps (14 principles of Management)

  • Esprit de corps simply means promoting team spirit and increasing unity within the organization.
  • This is the principle of ‘Union is Strength’ and the advanced stage of unity of command for establishing teamwork.
  • Every manager should encourage esprit de corps among his subordinate employees.

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Advantages of Administrative Management

➜ Healthy Financial Situation

Managerial administration plays a proficient part in overseeing the monetary issues of business associations. It is an administration methodology that spotlights keeping up with all costs inside the chosen spending plan. It directs all funds of the organization and guarantees that there is no wastage of cash which helps in keeping what is happening.

➜ Higher Productivity

It targets accomplishing the better coordination of all assets for determining the greatest result. The hypothesis of managerial administration coordinates the individuals from groups with their errand according to their abilities that prompts quicker results and higher efficiency.

➜ Works within Acquiring Goals

This effective system of the board help with achieving the essential objectives of the organization. Each arrangement is outlined after a basic investigation of business extends that prompts better activities and simple accomplishment of wanted targets.

➜ Information based Decisions

The regulatory administration hypothesis evades the premise of any presumption or impulse in the dynamic course of the association. All choices are assumed the premise of data accumulated connected with over a wide period exercises of association and the future imminent.

➜ Further, develop Employees and Customer Satisfaction

It helps in improving the fulfillment level of representatives by appropriately distributing their functions according to their abilities. Representatives get propelled towards their jobs which work on their presentation and generally quality that prompts increment the fulfillment of clients.

Disadvantages of Administrative management

➜ The board Oriented

The hypothesis of managerial administration is an essential administration situated hypothesis. This hypothesis doesn’t focus completely on the issues of laborers. Disregarding human conduct will have unfriendly impacts on the exhibition of the organization.

➜ Ideas Borrowed from Military Science

This technique of the executives has acquired ideas from military science, for example, ordering. These ideas are applied to the business and social associations like Fayol’s paid more spotlight on “instructing” and not over ”coordinating” of laborers.

➜ Disregards Environmental Changes

One more significant limit of regulatory administration procedure is that it doesn’t consider the climate changes which have a significant effect on the association. This hypothesis has an exceptionally restricted application in a unique and complex climate.

➜ Mechanical Approach

This hypothesis of the executives is robotic. It can’t be applied to key parts of the executives. Authoritative administration hypothesis has a restricted utility in an advanced administration idea like correspondence, initiative, and inspiration.

➜ Manages Formal Structure

One more significant limit with the authoritative administration hypothesis is that it disregards the casual construction of association. It doesn’t focus on non-formal gatherings and associations. This administration hypothesis just arrangements with the formal design of an association. Dismissing the casual gathering will effectively affect the execution of the association.

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Major Contributors to the Administrative Management Theory

  • Various scholars have added to Administrative Management Theory
  • These scholars foster various interaction-based methodologies that distinguish administration exercises assets of autonomous capacities.

These capacities occur at all levels of the association, no matter what the business or nature of the chief’s obligations. Imperative authoritative scholars include:

◉ Max Weber (1864-1920)

Weber is credited with creating Bureaucracy Theory. This hypothesis was a contemporary of the Scientific and pre-dated Administrative Management hypothesis. All things considered, we examine Webers fill in as a segment of Management Theory.

◉ James D. Mooney (1884-1957)

Mooney added to the authoritative administration hypothesis through his book, Onward Industry! (1931). In his text, he applied the regulatory administration hypothesis to associations in different homegrown and global settings.

◉ Luther H. Gulick (1892-1993)

Gulick was a doctor, chairman, and wellbeing instructor. He applied authoritative administration hypothesis standards to government and private associations.

◉ George Terry (1909-1979)

Terry distributed the primary text entitled, Principles of Management. He embraced Fayols Functions system. He consolidated instructing and controlling into realizing. He characterized a standard as a principal proclamation giving a manual for an activity to be applied through logical techniques.

◉ Harold Koontz (1909-1984)

Koontz moved toward the board hypothesis from the perspective of Human Relations inside the association. He pushed treating workers prudently as an administration approach inside the association. He co-created the book Principles of Management with Cyril J. O’Donnell.

◉ Ralph Davis (1894-1960)

Davis was a scholar and specialist who developed Fayol’s administration capacities model. He distributed a text, The Fundamentals of Top Management (1951), in which he acquainted a judicious arranging point of view with the Falls model. In that capacity, his effect was basically in the field of the executive’s technique.

◉ Henri Mintzberg (1939 – Present)

Mintzberg is a cutting-edge time scholar who studied Fayol’s work as inadequate and unrealistic. He developed the P-O-L-C system by zeroing in on the jobs that chiefs expect inside the association. The effect of his work has been significant and is examined as a different segment of Classical Management Theory.

◉ Robert L. Katz (1933-2010)

Katz developed the elements of chiefs by tending to the singular abilities that administrators should have at different levels inside the association. This work crossed logical and managerial hypotheses as is examined as a different segment of old-style executive’s hypothesis.