Henri Fayol Management Theory Explanation

Subway was first introduced to New Zealand by a man named Mark Rutherglen in the year 1994. In the year 1995, he opened his first subway in Parnell. There are over 200 subway stores in New Zealand. Hence, the business that I have chosen is a particular Subway Franchise in Saint Luke’s Mall which has been set up since 2004 and has been performing well overall. They have about 10 crew members excluding the manager, assistant manager and supervisor. Crew members receive the minimum wages rate at the beginning of their subway career and their working hours are subject to change according to the work schedule. The store operates from 10am to about 9pm daily. According to the manager, this particular location is a factor, the entire mall visitors are target markets this then creates a larger target market compared to the usual stores. The store manager has also said that the stores has been getting a significant amount of net profit every year and is in a very good shape financially and structurally.

The aim of the report is to analyse the application of managerial theory and roles in the modern day businesses. These concepts are the foundation of management skills and guidelines to our business management. The management theories that are going to be analysed in the report is the Henri Fayol’s Management Theory which refers to the PLOC concepts that stands for Planning, Leading, Organising and Controlling and the Mintzberg’s Managerial role which includes the Informational Roles, Interpersonal Roles, and Decisional Roles.

Henri Fayol’s Managerial Theory.

Henry Fayol was known as the father of management and his managerial theory was based on the 4 basic functions which is the Planning, Organizing, Leading, and Controlling. According to Henry Fayol the basic function is the foundation of management and is used in all organisations. The importance of each function may vary depending on the organisation.

2.0.1 Planning Function.

The function “Planning” used by Henri Fayol is described as the process where goals are defined and set. Planning is also the phase where the creation of idea and development of action or plans are performed to manage events or occurrence but most importantly to achieve the goals that are set. For example; in a small business organisation where the manager has to set a sales target of $5000 and he then provides a guidelines or set up strategies in order to reach the sales target. Managers act as planners at various levels and the managers decide where the team or the company should be progressing and how it should progress. In the Subway Restaurant, the manager Mike Duncan has stressed that the planning process is a baseline for their operation. The planning process takes place in almost every decision made and is vital to achieve their objectives. The organisation has set its goals for last year to achieve a profit increase in their first quarter year operation and maintain it throughout the year. The objective was set by the manager and immediately was followed by strategies establishment to achieve the objectives which was firstly to extend the operation hours to the maximum time limit of the malls operating hours which is from 6pm to 9 pm. Secondly, the managers has also offered a permanent roles to the employees and have cut down on the cleaning staff to minimize budget utilization. This is an example of operational planning where it is utilized daily to reach its (S.M.A.R.T) goals.

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2.0.2 Organizing Function.

The next function is “Organizing” where this function refers to the strategies and resources being put to action to achieve goals that are established when in the planning stage. Organizing comprises of the setting of flow of work and also the amount of human resource that are required to establish the work flow. Organising also refers to the distribution of capital and human resources and well as human roles and responsibilities in the organisation. For example the use of cash to purchase steel to be used in the car manufacturing. In the Subway franchise, the manager has to be detailed to the allocation of capital and human recourse to avoid wastage according to the manager. Organising takes place mainly in the capital of the organisation where the managers have to manage the cash to purchase sufficient inventory to produce their sandwiches such as breads, and other fresh vegetables and meats. The manager says it is a must to have records of all inventory and have possible estimate on the clearance of the stock avoid wastage. The labour allocation also plays a vital part where a sufficient amount of staff is enough to run the business with attention paid on the kitchen as that is the heart of the business. The manager always makes sure that the kitchen staff is sufficient and could manage the customer serving with much lesser workforce.

2.0.3 Leading Function.

The third is the “Leading” function which refers to the manager’s traits as leaders of the organisation and their style of managements. It is the ability of managers to motivate and guide the employees to a better production. This is the where managers step in as leader where they have to set a work concept to be followed by the employees for examples the ways of making a Sub from the bread selection to the meat, vegetable and sauce selection process. The manager stick to a casual work flow where the first come first serve rules applies and each worker either serves one customer or at peak hours workers manages selected stations for example the bread and meat section is managed by a worker and the vegetable and sauces is managed by the other employee. The leading process also emphasises on the effective ways of communication among employee and managers and managing employee’s daily conflicts that occurs at work or even outside of work. Managers also has to deal with employee disagreement and conflicts such as a case that was handle by Mr. Mike which was the employee work efficiency rate has been decreasing due to relationship issues at home. He was given a consultation providing holidays to calm him and the result showed an improvement. Mr. Mike believes in a direct but gentle approach to workers which enables him to enforce job efficiency and at the same time manage a healthy way of communication.

2.0.4 Controlling Function.

The last Function is “Controlling” which refers to the manager’s ability to monitor the progress of the action to reach the goals that were set. This ensures that the goals are being met and that any deviation can be prevented and problem occurrence can be managed and handled. It is basically the actions of managers making sure that the strategies are working well and that the workers are actually implementing the skills available. Mike Duncan does not apply the controlling function much as he say it is important to allow the employee to have working freedom and a small scale monitoring is enough to ensure the goals are being met as the organisation deals with a small number of employees and less monitoring creates a better mindset in employees. It is important that employees don’t feel underestimated and constant monitoring would cause that, hence work freedom is important to build a more productive worker and comfortable working environment.

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Mintzberg’s Managerial Roles.

Henry Mintzberg has come up with ten selectively identified roles that play important part in the management. He has classifies the ten Roles into 3 different categories which is the Interpersonal roles, Informational roles, and Decisional Roles.

3.0.1 Interpersonal Roles.

This category explains the roles of manager to provide the information, direction and supervision on the employees and the organisation. The first role is the “Figurehead” which explains the manager to be inspirational and a model that shows what the organisation are working towards. Subway manager is acts as the figurehead of the team and he does this with having a cumulative and total knowledge of the organisation. He also becomes a model by shaping his image and reputation to influence his subordinates and use humility and empathy while working. For example when there is a new worker that joins the organisation he provides them with accurate information and direction on how to work in the organisation using polite gesture and voice tones. Second is the “Leader” role which the manager has the responsibilities to provide employee with trainings and manage their performance and responsibilities both individually and as a team. It is essential to have leadership skills and a good emotional intelligence to fulfil this role. Mike Duncan is the leader in the subway team, he portraits his leadership skills by managing and directing the activities and chores of his team members. He also generally creates a high performing team with his skills. For example; he manages the baking staff to produce about 500 bread loafs of 4 different kind, he mentors his baking team with providing rewards of consistency and task fulfilments. Thirdly is the “Liaison” role where the manager functions as a communicative tool for both internal and external organisational activities. A manager must have a large network around him and uses this network to its mutual advantage to fulfil this role. As for subway manager where his known associates in organisation in the bakery industry was used to a mutual advantage when there were a breakdown in the baking machines and he was able to rent a smaller scale baker to keep the his team production going.

3.0.2 Informational Roles.

This category explains the actions needed in the processing of information in an organisation. First role is “Monitor” which expects managers to analyze information and changes relating to the organisation and the environment while monitoring team for productivity and well being. It is a must to have up to date knowledge on the industry and ability to process material quickly to avoid information overloading to be a good monitor. This is where Mike Duncan manages monitors his team for productivity and well being by being on field as regularly as possible and have constant chat with employees on their performance. He also keeps in touch with the subway brand to have updates on the new products and promotions as well as rules to get them in motion on time. Secondly is “Disseminator” which is about transmission of information that influence and would be useful to the team. In order to be a good disseminator, good communication skills are needed to provide information and view to the employees. Subway manager always have briefings with his employees to update them with new product, the latest being the Lemon Chicken & Herb Sub. He also informs the progress of the organisation to further motivate the employee in reaching a larger target. Thirdly is “Spokesperson” role where the manager represents the organisation to provide information to people in and out of its organisation. This role also requires a good communication skills as well as skill to create confidence in people towards your organisation. Mike Duncan has represented subway brand in the seminar in 2010 to provide information about the subway brand to new and potential franchiser. He acted as a spokesperson in the seminar to convince potential franchisers.

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3.0.3 Decisional Roles

This category explains ways managers uses the information available. First is “Entrepreneur” role where managers generate new ideas and apply them in coherence with the resource available. This role is not applicable in the franchise business as the entrepreneurship is done by Subway brand Managers and their decision are meant to be applied by Branch Managers but it is possible for Managers to produce a proposal to the Brand managers. Secondly is “Disturbance Handler” which is the role of manager to manage crisis. This is a common role played by Mike Duncan as he has been repeatedly involved in mediating customer arguments and employee arguments. Mike Duncan was faced with employee arguments and had to act strictly to support the right person and council the wrong person. “Resource Allocator” is where the manager determines where organizational resources are best applied. Subway manager perform this role when he is supplied with a budget to obtain raw material and calculate wages of employees. He also allocates the amount of labour needed in certain sections of the organisation. This involves allocating funds, human resource and other organizational resources. Lastly is “Negotiator” is where manager take direct part in determining terms and agreements between teams, department and organisation. Subway Manager acts as a Negotiator when he signs new workers such as supervisors and bakers where he negotiates the benefits provided and demanded by workers as well as when any customer complains, Mike Duncan has to step in and negotiate terms and provide complimentary offers to satisfy customers.


In conclusion, basically Fayol and Mintzberg contribution in the world of management is impressive but distinctive. Henri Fayol maintains the functional approach which manager’s task is classified based on the basic concept of plan, organise, lead and control. On the other hand, Mintzberg, 10 managerial roles represent the real managerial work. The application of the Fayol function and Mintzberg roles has been shown in the subway franchise by the manager who has applied each function to its management style as well as fulfil key roles of mintzberg as a manager. For example the manager has used planning to plan its organisations targets and ways to meet them and played a monitor roles where he analyze information and changes relating to the organisation and the environment while monitoring team for productivity and well being.

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