MECHANICAL ENGINEERING - 15ME51T 1
Department of Collegiate and Technical Education
UNIT I : BASICS OF MANAGEMENT
Session 2: Fayol’s Principles of Management, Business and factors affecting business
INDUSTRIAL MANAGEMENT (V Semester)
MECHANICAL ENGINEERING
Overview
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• Henry Fayol’s Principles of Management
• Business
• Private Sector and Public Sector , joint sector
MECHANICAL ENGINEERING- 15ME51T
Recap : Fayol’s Principles of Management
1. Division of work2. Authority and responsibility3. Discipline4. Unity of command5. Unity of direction6. Subordination of individual interest to
general interest7. Remuneration
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Fayol’s Principles of organisation
8. Centralisation9. Scalar chain10. Order11. Equity12. Stability of tenure13. Initiative14. Espirit de corps
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8. Centralisation
• For effective management of people, planned decentralisation is necessary
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Centralization Decentralization
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• Centralisation means all
authority retained at a
central point.
9. Scalar chain • It means that the authority and responsibility must flow
along a line
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General Manager
Works Manager
Works Manager
Foreman
Workers
Line
of a
utho
rity
Line
of A
ccou
ntab
ility
MECHANICAL ENGINEERING- 15ME51T
10. Order
• A place for everything and everything in its place(material) or a place for everyone and everyone in his place (men) means order.
• The factory must be in order such that every material can be taken out easily and every person located easily
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11. Equity
• Management must treat all employees justly and kindly.
• Maintain discipline as necessary and acting with kindness where appropriate.
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12. Stability of tenure of personnel • An average manager who stays is
better than a brilliant manager who comes and goes.
• Managers need time to improve their skill and enhance their efficiency
• 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.
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13. Initiative
• It is the ability to start action, to
take decisions
• The management should support
and encourage the employees to
take initiatives in an organization.
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14. Espirit De Corps (French words)
• It is a sense of harmony and union among the personnel of a company
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Business
• Business may be defined as an activity in which different persons exchange something of value whether goods or services for mutual gain or profit.
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• A business is an organization or entity that sells goods or services for a profit
Business• It can also be defined as an enterprise engaged in
production and distribution of goods for sale in market or rendering service for a price.
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• Main purpose is to generate profits.
Business• Commerce : Allied activities like insurance,
transportation, accounting etc.• Industry – Converting raw material in semi finished or
finished goods• Trade : Buying and selling of commodities
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TYPES OF BUSINESS ORGANIZATIONS
• Private sector Individuals invest money and directly or indirectly control the organisation
• Public sector companies Government invests money and runs the organizations.
• Joint sector Ownership and control shared by private enterpreneur, state and public.
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• Henry Fayol’s Principles of Management• Business Organisation• Private Sector and Public Sector , joint
sector