Significance of Principles of Management
The principles of management are in the form of pre-determined solutions for repeatedly accruing problems. They guide the manager. It is very important for every manager to know them thoroughly. The importance of the principles of management becomes abundantly clear from the following facts:
(1) Provides Useful Insight to Managers:
The principles of management were developed on the basis of the experience of various professional people. The principles inform the manager about the manner in which he should act in various situations so that he does not repeat the mistakes of the previous managers. In this way, timely guidance reduces the wastage of resources and the objectives can be achieved in a less expensive manner.
For example, according to one principle of management, i.e., division of work, a job is divided into many small units. Every unit or part is assigned to different individuals. Each individual does the same work repeatedly that has been assigned. He gets used to it which helps him to perform his job efficiently and quickly. Consequently, the entire job is completed in an economical manner.
(2) Optimum Utilization of Resources and Effective Administration:
In every organization physical (material, machines, money, etc.) and human (man-power) resources are used. The function of management is nothing but to put them to optimum use or avoid wastage of resources. And it is possible only when a manager makes use of the principles of management. According to the principle of ‘unity of command’ there should only be one boss for an employee at a time. In case there is more than one the employee will not be in a position to work properly. Consequently, human resource will be wasted. Therefore, if we desire to use the human resource favorably, this principle has to be adopted. Similarly, many other principles ensure favorable utilization of various other resources.
The primary need of every organization is that its administrative system should be effective. Only that administrative system is called effective where the managers can take balanced and quick decisions . In order to take such decisions, sufficient information and authority should be available. This is made possible with the help of the principles of management. For example, the principle of `authority and responsibility’ advocates granting of sufficient authority, while the principle of scalar chain advocates making adequate provision for providing information.
(3) Scientific Decisions:
A scientific decision means a balanced decision. The principles of management provide the necessary training to the managers so that they can take scientific /balanced decisions. In the absence of these principles the managers have to adopt the method of trial and error. According to this principle, one is expected to do a job in a particular manner and if there is some error, some other method has to be adopted. In this way, the work is done in different ways till the error is eliminated. This method is not proper. Therefore, the managers are trained with the help of the principles of management which makes them capable of taking scientific decisions.
For example, the principle of `authority and responsibility’ tells us that if a subordinate is entrusted with some responsibility, he should be allowed sufficient authority to accomplish it. Only in such a situation a subordinate will be able to take a scientific decision whenever needed.
(4) Meeting Changing Environmental Requirement:
In modern times only such a business unit can remain alive and develop which can keep pace with the rapidly changing environment. In every field of business activity (production, marketing, etc.) new techniques are emerging every day. A manager who can understand the changing situation well in time can alone face competition successfully. The principles of management enable the managers to face this challenge.
For example, the principle of ‘unity of direction’ tells us that all the activities connected with the attainment of the same objective should be completed under the direction of the same manager. In doing so a manager would be able to have the detailed information connected with the limited activities being done under his direction. In case the activities connected with different objectives are being done under the direction of one manager, he will not be able to understand the changes being affected in any activity.
(5) Fulfilling Social Responsibility:
The principles of management increase the efficiency of the managers and enable them to fulfil their social responsibility. More efficient managers can make good quality products at reasonable prices available all the times.
For example, the principle of “Fair Remuneration’ advocates appropriate remuneration to the employees and helps in fulfilling responsibility towards them.
(6) Management Training, Education and Research:
The advantages of the principles of management encourage the researchers to bring in more improvement in them. The attitude of the managers has molded itself in such a fashion that they are doing, consciously or unconsciously, something new. It means that the managers have come to acquire an attitude titled towards research and development. This has helped the managerial knowledge to be more solid and scientific. The principles of management are actually providing education and training to the managers by enriching their theoretical and practical knowledge.
For example, in order to take advantage of the change of attitude among the managers, various big companies have established Research and Development Departments, HRD. Consequently, many new techniques have come to light in the field of marketing, production, finance, etc.