Everything you need to know about the importance of management principles. Management principles are the result of long experience of managers in different fields of organised work.

A principle is a basic statement that provides understanding and it acts as a guide to thinking and action

It is a fundamental truth that explains relationship between two or more sets of variable in a given situation. It is a basic element of management theory that helps in predicting what would happen if the principles were applied.

The importance of management principles can be studied under the following heads:-


1. To Increase Operating Efficiency 2. To Crystallize the Nature of Management 3. To Improve Research 4. To Attain Social Objectives 5. Emergence of Clearer and Systematic Thinking 6. Increase in Productivity

7. Simplification of Managerial Work 8. Development of Management Thought 9. Managerial Training 10. Understanding of Human Behaviour 11. Improvement in Organizational Productivity 12. Improvement in the Study of Management Thought and a Few Others.

Importance of Management Principles

Importance of Management Principles – Managerial Training, Higher Efficiency, Highlight True Nature of Management, Social Objective and Research

Management principles are needed for the following reasons:

1. Managerial Training:


To develop managerial talent it is essential to teach man­agement in Institutes and Universities. Teaching and training of managers requires a systematised and structured theory of management comprising of a number of inter related prin­ciples.

Management principles provide a conceptual frame­work for systematic training and development of future man­agers. If such a framework is absent, management training will have to depend on haphazard trial and error. Principles of management have consistently suggested the areas in which training should be given.

2. Higher Efficiency:

One of the foremost objectives of management principles is to improve understanding of managers and indicate to them how to manage an organization with the help of these prin­ciples. Managers can decide on their place of action for achieving their objectives. These principles provide the managers with guidelines for working in different situations.


These principles, therefore, help in improving managerial ef­ficiency. With the help of management principles managers are better enabled in taking a realistic view of situations and thereafter make a rational, feasible and effective decision, there by directing human behaviour effectively.

This does not mean however, that the management principles provide the manager with a complex kit of answers for all problems. Instead, these principles enable managers to work system­atically and reach a logical solution to the situations they face.

In the absence of principles, a manager will have to depend on intuition or trial and error method, both of which are asso­ciated with high cost. Serious mistakes may be avoided if managers are aware of and guided by the management prin­ciples. For example, the principle of stability of tenure warns a manager that insecurity about the tenure of job will lead to problems and inefficiency.

3. Highlight True Nature of Management:

Principles of management are necessary to clearly under­stand the true nature of management. Lack of management principles makes it difficult to clearly define the nature and scope of the managerial job. Principles act as a checklist of the meaning and contents of management. They serve as criteria to judge the appropriateness of managerial decisions and actions in addition to highlighting the role of managers in concrete terms.

4. Social Objective:

Business organisations have a social objective in addition to their financial and economic objectives. Managers coor­dinate the efforts of people so that individual objectives get translated into social attainment. Business organisations have major impacts on the society. The standard of living of people depends upon the quality of management.

If man­agement is efficient, the resources of society are better utilised and quality of life is improved. Principles of manage­ment have helped in increasing the efficiency in the use of resources, there by impacting the culture and society and revolutionalising the progress of human society.

5. Research:


With the development of fundamental principles of any sub­ject, their scope and limitations are also defined. These form the basis for further research in that subject. In the absence of principles, research becomes difficult and future horizons of knowledge cannot be expanded. Principles of manage­ment suggest the lines along which research should be car­ried out to develop new guidelines and to ascertain the va­lidity of existing guidelines. Management principles help to make management more practical and effective.

Importance of Management Principles – (With the Features of Management Principles)

Theory is a systematic grouping of interrelated principles.

Management theory supplies guideposts for action. This enables managers to approach various problems systematically. Management theory provides principles which should be applied judiciously.

A principle is a basic statement that provides understanding and it acts as a guide to thinking and action. It is a fundamental truth that explains relationship between two or more sets of variable in a given situation. It is a basic element of management theory that helps in predicting what would happen if the principles were applied.


Management principles are the result of long experience of managers in different fields of organised work. Principles are classified as descriptive, prescriptive or normative. A descriptive principle merely describes the relationship between variables. A prescriptive or normative principle is stated to indicate what a person should do. Management principles are both descriptive and prescriptive.

The need for management principles is aptly described by George R.Terry in the following words principles of management are to a manager as a table of strength of materials is to a civil engineer. By following the principles, a manager can avoid fundamental mistakes in dealing with resources.

The need and importance of management principles is listed below:

(1) To Increase Operating Efficiency:


The principles of management serve as guidelines to manager for effective functioning in different situations. The managers can avoid the risky practice of trial and error and base their actions on sound knowledge of management theory. So the managers can concentrate on improving the operating efficiency of the organisations.

(2) To Crystallize the Nature of Management:

The science of management is to be developed to analyse managerial job and to design programmes for training and developing managers. This has facilitated and will facilitate in developing a considerable body of knowledge and in the crystallisation of management principles.

(3) To Improve Research:

Research may be undertaken to expand the frontiers of management knowledge and theory. Every day number of research projects is pursued to test the validity of various hypotheses of management. These research projects would further enrich the management science.

(4) To Attain Social Objectives:


Management principles have an important role in preparing efficient managers. Efficient managers can utilise the resources of the society effectively and this will lead to better quality of life. Management plays an important role in shaping the life of people through government and other organisations.

The features of management principles are as follows:

(1) General Statements:

Management principles have been derived out of experience and analysis only. They deal with human beings and no manager can ever be sure about the behaviour of human beings who come from different background, perceptions and needs. So they cannot be tested either in a laboratory or controlled conditions. That is why they have been expressed in the form of general statements.

(2) Dynamic Guidelines:

Business is always in a constant state of flux. Management principles change with the changes in environment in which an organisation exists. So the principles of management are to be accepted as flexible and dynamic guidelines and not rigid and static rules. So the principles of management are flexible and refinement in principles is taking place continuously due to constant research.


(3) Situation Based:

The applicability of management principles depends on the situation faced by the manager. They can be modified by the manager to meet the requirements of the situation. They undergo a change according to the changed conditions. Their application needs a careful consideration of organisational requirements and situational demands.

(4) Universal Application:

Management principles can be applied to all kinds of organisations, namely, business, social, political, religious and non-profit organisations. These principles are made use of by people who manage different organisations and needed in any organisation where there is a need for co-ordinated efforts of human beings.

Importance of Management Principles – For Managers: Increase in Efficiency, Emergence of Clearer and Systematic Thinking, Opportunity for Research and a Few Others

Importance of principles enumerated may be deduced from the principles themselves. The principles are of utmost importance for managers.

The following discussions bring out the importance of management principles which have been classified into four heads as written below:


1. Increase in efficiency.

2. Emergence of clearer and systematic thinking.

3. Opportunity for research.

4. Increase in productivity

Importance # 1. Increase in Efficiency:

Principles are important for increasing the efficiency of managers as well as of the workers. No doubt owns experiences are the best teachers. But if one is taking the advantages of the experiences of others he is doubly benefited.

He, in such circumstances, is not required to bother about the generalisations which have already been acquired by him either by his own experiences or by taking a lesson from others. Not only this but at the same time he is free to put these generalisations to test and adjust and improve over them according to his own or others experiences.


These principles are not rigid. They are flexible. They can be put to test and according to requirement can be modified even during the process of his test and working. This factor further enhances the possibility of increased efficiency being achieved throughout the whole process of working.

Importance # 2. Emergence of Clearer and Systematic Thinking:

Principles make the thinking clearer and systematic. Principles are helpful in imparting training to managerial personnel. In fact their training starts on the basis of these principles. They learn the principles. They evolve their own thinking. They put them to test. Their thinking then becomes clearer.

They systematically put their new acquired knowledge into an order according to their own way of thinking, mode and work schedule. They, after testing and acquiring experiences, try to improve over them whenever they think the need has come for improvisation and they themselves care capable of providing and improvement over them.

Importance # 3. Opportunity for Research:

The principles of management offer enough scope for further researches, advancement of science, which has still not gone too far, is only possible through surveys and researches. Enough opportunity for researches are there within the framework of the management principles itself.

The science of management is still in its infancy. Its principles are constantly put to test and modified. Every manager is free to adopt his own way of management within the set objectives and principles. But certainly he is free to experiment and evolve his own thinking which may be converted into principles at a later date after proper analysis, test and further experimentation. This gives the science of management a research character in its own right.

Importance # 4. Increase in Productivity:

Constant research and evolution of new thinking lead us to a safe conclusion that new generalisations may come up. Naturally, new generalisations and consequent adoption of new principles may help in increasing the efficiency and thus productivity of all factors of production which from all account is a social gain.

In fact society is the real gainer from the management principles as ultimately it is the society as a whole which stands benefitted by the increase in productivity. Increase in productivity brings prosperity to the enterprise, to its workers, to its allied institutions and thus ensures a prosperous and brighter society.

Management Principles are Flexible:

Efficiency and successful management depends on well-conceived principles. These principles may not be absolute. The principles must reflect the aspirations of the science and the purpose for which they have been originally conceived. This possible only when the principles acquire a flexible character which in its turn will offer scope for debates, deliberations, tests and experiments.

It is not necessary that the management should follow the set norms and that it should in no circumstance deviate from the treated path. No social science, even for that matter exact science also; worth its name can afford this situation. Certain amount of flexibility in genuinely required to accommodate new thinking and to adjust accordingly to the demand of the situation in which principles are being put to use.

No thinker, however, great and saintly he might have been, can visualise all the situations which are expected to follow him and his principles. His principles would have to stand to the test of the time. His one generalisation may hold good at certain juncture but the same may need modifications after lapse of a particular time.

Management principles, like principles of other social sciences, must have a flexible character. A living science, which the science of management is, must be flexible in order to characterise itself as a living and dynamic science.

Putting the science of management to this test we may safely conclude that the principles of management are neither absolute nor stable in all times and for all times to come. They are such which according to changed and special conditions prevalent at a given time may have to undergo a change. The principles of management are elastic in true sense of the term.

The above discussions do not suggest that the principles of management may be overhauled according to whims and experiences of even those who have not matured themselves in the field or who are bent upon to say and do something contrary to the established principles and practices even if their newly acquired knowledge and generalisation are neither worthwhile nor they could withstand the test of time.

The principles of management, though flexible are to be guarded against such type of change seekers. But the principles of a developing, dynamic and living science like management should be flexible and should be able to carry the time with them.

Universality of Principles of Management:

Henri Fayol a well-known author of management while propagating his principles has specifically expressed that his principles are not applicable only to business houses by they could be easily applied to social, political and religious organisations with same amount of clarity and success. Fayol proved true. He was confident about his assertion and fortunately for the mankind his confidence has not betrayed him.

The universality of these principles has been established beyond doubt. Scientific management is based on solid principles, and are the outcome of vast experiences. Functional areas of the process of management – such as Planning, Organisation, Control, Co-ordination and Co-operation are so universal that even without slightest change they could be put into practice in fields other than business and industry.

The principles are not the monopoly of economic sector alone. Any organisation for whatever purpose it has sprung up, can take advantage of these principles and put them into practice with success. In fact these principles have other fields more respectable to social needs. Social consciousness of the human sciences has required new dimensions because of the University of the Principles of the science of management. Aided by these principles organisations not belonging to economic sector have successfully tried to attain their objectives.

Management principles are basic but at the same time they are not rigid and hard. They are elastic and are responsive to the circumstances in which they are put to use. ” The fundamental principles of scientific management”, says F.W. Taylor, “are applicable to all human activities from our simplest individual acts to the work of our great corporations.”

Henri Fayol himself has said that the “meaning which I have given to the word ‘administration’ embraces not only the public service but enterprises of every size and description of every form and every purpose.”

Importance of Management Principles – Simplification of Managerial Work, Development of Management Thought, Managerial Training and a Few Others

Principles of management are significant because of the following reasons:

1. Simplification of Managerial Work:

Management principles make the work easy and simple. Managers can perform complex managerial tasks on the basis of these principles and make sound business decisions. Actions in different situations are facilitated through management principles.

2. Development of Management Thought:

Management is a full-fledged field of study taught in schools and universities. Management teachings on the basis of management principles develop management theories and thoughts which become the basis for managers to carry out the managerial functions effectively in business and non-business organizations.

3. Managerial Training:

Management as a discipline is taught to manage large-sized business houses. Teaching and training managers on the basis of sound management principles helps them perform better in all the functional areas (production, finance, personnel and sales).

4. Understanding of Human Behaviour:

Management is a behavioural science. It deals with people and tasks performed by them. Management principles help to understand the human behaviour and ways to satisfy their needs (physiological and psychological) that lead to excellence in their behaviour, Excellent or high performance behaviour leads positively towards accomplishment of organizational goals.

5. Improvement in Organizational Productivity:

Management principles help to solve various organizational problems in a pre-defined manner. They guide actions appropriate to the situation. This results in efficient decisions and optimum utilization of scarce organizational resources and increases organizational productivity and profits.

6. Improvement in the Study of Management Thought:

When management principles exist as the foundation of management thought, they provide scope for future research and improvement in the existing principles. This helps to attain organizational goals more efficiently.

7. Social Objective:

Besides attaining organizational goals, management principles also help to improve standards of society. Well managed organizations have satisfied workers whose economic and non-economic needs are largely satisfied in organizations. Such organizations and people working therein reflect better standards of society. This improves image of the nation at the national and international forum.

Importance of Management Principles – To an Organisation

Principles of management are important to an organisation as guidelines which govern and promote the operations of an organisation. These principles identify the requirements, set standardised approaches and conducts critical activities requiring the most attention.

The significance of principles of management to an organisation is detailed below:

1. Increases efficiency-Principles of management provide guidelines to a manager to tackle complex problems in an efficient manner to make organisational operations run smoothly. The efficiency placed within an organisation attempts to make managers adopt systematic and scientific approach towards an appropriate solution to the problem.

2. Social objective-The principles attempt to create an environment involving cooperation and coordination between managers their subordinates and employees. This attempt ensures optimum utilisation of resources, minimal or no wastage of resources and maximum profit without loss of social value.

3. Sound understanding-The principles generate a sound understanding of standards and directives across managers and employees to tackle complex problems and seek relevant solutions.

4. Areas of training-Principles of management aim at determining present and prospective areas of change and development in an organisation. Accordingly, it enables relevant training among managers and workers that keep up to changing times to facilitate possible growth and opportunities in the future.

5. Guides research-The guidelines developed in an organisation under these principles are always subject to change with changing times. Future modifications require relevant research ensuring that the modified guidelines are practical and feasible.

Importance of Management Principles – 7 Points that Highlight the Importance of Management Principles

The given points highlight the importance of management principles:

i. Provides manager with useful insights into reality/Improves understanding – The knowledge of principles improves the understanding of managers about the ways and means of managing an organisation. Management principles are helpful in taking decisions and handling situations arising in course of management.

ii. Scientific decisions/helps in thoughtful decision making – Management principles help in thoughtful decision-making. They emphasise logic rather than blind faith. Management decisions taken on the basis of principles are free from bias and prejudice. They are based on the objective assessment of the situation.

iii. Optimum utilisation of resources and effective administration – Resources should be put to use in such a manner that they should give maximum benefit with minimum cost. Principles equip the managers to foresee the cause and effect relationships of their decisions and actions. As such wastages associated with a trial-and-error approach can be overcome.

iv. Direction for training of managers – The principles is helpful in identifying the areas of management in which existing and future managers should be trained. The principles of management help the Universities and professional institutes to impart teaching and training in the theory and practice of management.

v. Guide to research in management – The body of management principles indicates the lines on which research should be undertaken to make management practices more effective. The management principles which have so far been developed by experienced managers can be tested through research to make them perfect as nearly as possible.

vi. Meeting changing environment requirements – Principles are modified and as such help managers to meet changing requirements of the environment. Companies are specialising in their core competency and divesting non- core business.

vii. Fulfilling social responsibility – Management principles also guide the managers to perform social responsibilities. Principle of ‘equity’ today does not apply to wages alone. Value to customers, care for environment, dealings with business associates also come under the purview of this principle.

Importance of Management Principles – Improves Understanding, Direction for Training of Managers, Role of Management and a Few Others

The principles of management are in the form of pre-determined solutions for repeatedly occurring 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. Improves understanding:

From the knowledge of principles managers get indication on how to manage an organization. The principles enable managers to decide what should be done to accomplish given tasks and to handle situations which may arise in management. These principles make managers more efficient.

2. Direction for training of managers:

Principles of management provide understanding of management process what managers would do to accomplish what. Thus, these are helpful in identifying the areas of Management in which existing and future managers should be trained.

3. Role of management:

A management principle makes the role of managers’ concrete. Therefore these principles act as ready reference to the managers to check whether their decisions are appropriate. Besides these principles define managerial activities in practical terms. They tell what a manager is expected to do in specific situation.

4. Guide to research in management:

The body of management principles indicates lines along which research should be undertaken to make management practical and more effective. The principles guide managers in decision making and action. The researchers can examine whether the guidelines are useful or not. Anything which makes management research more exact and pointed will help improve management practice.

5. Evaluating the behaviour of managers:

Management principles prescribe what one should do to improve things in some ways. These principles attempt to prescribe and evaluate the behaviour of the managers of the organization.

6. Improving efficiency of managers:

Management principles serve as a guideline for doing work with greater efficiency. These principles help managers to take a more realistic view of different managerial problems and to direct human behaviour effectively. The conscious manager can become more effective by using the established management principles to solve problems.