The providing adequate compensation to induce subordination,

The idea of subordination of individual interest is a principle developed by Henri Fayol.

In this lesson, you will explore this principle. You will also be given an opportunity to reinforce your knowledge about Fayol’s principle with a short quiz.

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An Intro to Fayol

Subordination of Individual Interests to General Interest is one of Fayol’s fourteen administrative principles where any individual’s interest that conflicts with an organizational interest must be subordinated to the interests of the organization. The organization must find ways to reconcile the tension between individual and organizational interests.Henri Fayol (1841-1925) was born in France and made significant contributions to administrative management theory. After graduating from the National School of Mines, he began to work for a mining company where he stayed for his entire career, eventually becoming its managing director.

During his tenure at the company he developed fourteen principles that he attributed to his management success.

Application of Principle

Fayol’s principle of subordination of individual interests to organizational interests can be difficult to implement in the United States where cultural ideals hold the importance of individual interests and freedom over those of group interests. A manager needs to find ways to reconcile discrepancies between organizational interests and individual interests as much as possible. Methods available include carefully selecting employees who share organizational goals and values, providing adequate compensation to induce subordination, and careful management and monitoring of employees to ensure they are acting for the organization’s interests.

Example

Let’s say you work as an HR manager for a top car manufacturer.

You need to hire a new engineer to work on the company’s hybrid car project. In making a hiring selection, you may use a personality test and a series of interview questions to see if there’s good alignment between an applicant’s interests and values and those of the organization. For example, you may be looking for engineers with passion for green design. You’ll also want to develop a sufficiently competitive and fair compensation package to provide an incentive for the new employee to remain loyal to the organization’s interests. You prepare an orientation program that educates employees about the organizational values and interests. This program also attempts to demonstrate how these values and interests are in accord with the individual interests of the like-minded employees you’ve hired.

You must now depend on management to ensure the employee doesn’t place any conflicting personal interests over those of the organization.

Lesson Summary

Let’s review. Henri Fayol developed fourteen administrative principles that contributed to administrative management theory. One of the principles is the subordination of individual interests to organizational interests.

Approaches that may be utilized to accomplish this principle include: ensuring that personal interests and organizational interests align as closely as possible, providing competitive and fair compensation packages to provide an incentive for an employee to subordinate personal interests, and having careful managerial supervision.

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