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The Leadership Continuum is a range of leadership behavior that depicts decision making behavior and a corresponding degree of authority used and the freedom of available to subordinates. This is a great tool to use because leadership emphasized decision making. It is good to know what kind of leader you are and how much or little freedom subordinates need depending on situations.

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Leadership & Project Management Champions

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In the past few decades, many leadership gurus came up with different definitions of leadership styles. Out of those theories, many of them are based on task - relationship characteristics. In 1938, Lewin and Lippitt proposed classifications of leaders based on how much involvement leaders placed into task and relationship needs.

Almost after four decades, in 1973, Tannenbaum & Schmidt came up with a continuum of earlier studies with range of leadership behaviors, ranging from manager-centered (task) to subordinate-centered (relationship).

Tannenbaum and Schmidt Continuum model shows the relationship between the levels of freedom that a manager chooses to give to a team, and the level of authority used by the manager. As we already discussed in Situational leadership, number of parameters goes into choosing the managerial style: manager's competence, subordinate's developmental level, the situation.

Based on the above parameters, level of delegation takes any one of the seven levels as depicted by the central arrow line.

Tannenbaum & Schmidt concentrated more on delegation & freedom in decision making to subordinates and there by on the team development. As the team's freedom increases, the manager's authority decreases. This is a positive way for both teams and managers to develop. We already dealt delegating in a different blog post.

Tannenbaum & Schmidt defined 7 levels of delegated freedom which moves from manager-oriented to subordinate-oriented. As team develops, level moves from one to the next - the area of freedom increases and the need for manager's intervention decreases. Following levels are self-explanatory and easy to understand:

1. Manager takes decision and announces it - only manager plays the decision-making role; no team involvement

2. Manager decides and then "Sells" his decision to the team - no change in decision; but team may raise some concerns

3. Manager presents decision with background ideas for the decision and invite questions - team knows what options manager considered for his decision; more team involvement

4. Manager suggests provisional decision & invites discussion regarding the decision - team can have a say on manager's decision; it can be changed based on discussion

5. Manager presents the problem or situation, get suggestions, then decides - team is free to come up with options; manager decides on those options

6. Manager explains the situation or problem, defines the parameters and asks team to decide on the solution - manager delegated whole thing to the team; but still manager is accountable for the outcome

7. Manager allows team to develop options and decide on the action, within the manager's received limit - complete freedom level; team does all the work almost as what the manager does at level 1.

The main advantage of this theory: for leaders/managers - it defines the criteria for involvement and delegation & range of choices for the involvement.

Update on 08/16/2011 - Added Google Doc Presentation of this Article:

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What does Tannenbaum & Schmidt Continuum Theory say?

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In the past few decades, many leadership gurus came up with different definitions of leadership styles. Out of those theories, many of them are based on task - relationship characteristics. In 1938, Lewin and Lippitt proposed classifications of leaders based on how much involvement leaders placed into task and relationship needs.

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Servant leadership is an approach to leading in which leaders view their primary role as helping followers in their quests to satisfy personal needs, aspirations, and interest. From personal experience it is always great to know that the person above you is looking our for you. Having a supervisor who is willing to stand up for you and actually care about you is great for morale.

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While servant leadership is a timeless concept, the phrase "servant leadership" was coined by Robert K. Greenleaf in The Servant as Leader, an essay that he first published in 1970. In that essay, Greenleaf said:

"The servant-leader is servant first... It begins with the natural feeling that one wants to serve, to serve first. Then conscious choice brings one to aspire to lead. That person is sharply different from one who is leader first, perhaps because of the need to assuage an unusual power drive or to acquire material possessions...The leader-first and the servant-first are two extreme types. Between them there are shadings and blends that are part of the infinite variety of human nature.

"The difference manifests itself in the care taken by the servant-first to make sure that other people's highest priority needs are being served. The best test, and difficult to administer, is: Do those served grow as persons? Do they, while being served, become healthier, wiser, freer, more autonomous, more likely themselves to become servants? And, what is the effect on the least privileged in society? Will they benefit or at least not be further deprived?"

A servant-leader focuses primarily on the growth and well-being of people and the communities to which they belong. While traditional leadership generally involves the accumulation and exercise of power by one at the "top of the pyramid," servant leadership is different. The servant-leader shares power, puts the needs of others first and helps people develop and perform as highly as possible.

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What is Servant Leadership? - Greenleaf Center for Servant Leadership

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While servant leadership is a timeless concept, the phrase "servant leadership" was coined by Robert K. Greenleaf in The Servant as Leader, an essay that he first published in 1970. In that essay, Greenleaf said: "The servant-leader is servant first... It begins with the natural feeling that one wants to serve, to serve first.

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I believe that behavior modification is a great tool to use. Especially positive and negative reinforcement. I feel a lot of people believe that the work they do doesn't matter and it is for the best to provide employees with feedback to let them know they are appreciated. I have also work in a place where negative reinforcement wasn't properly handled and created conflict in the workplace because they feel things aren't fair.

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Use of motivational tools directly impacts work culture.

Digital Vision./Digital Vision/Getty Images

A rudimentary definition of behavior modification is encouraging others to behave the way you want, while discouraging the kind of behavior you don't want. The workplace is the ideal setting to examine behavior modification because it occurs in practically all workplace interactions, whether employee-employee relationships, manager-employee relationships or employer-employee relationships. Behavior modification in the workplace is ideal for it produces more satisfied workers and increases employers' profitability.

Corrective Action

Most companies have some form of disciplinary review process. Whether it's referred to as a progressive discipline policy, employee coaching or constructive feedback, the desired outcomes are the same: fewer employee issues and better job performance. Workplace policies constitute the first step in behavior modification. Most employee handbooks contain a description of the company's disciplinary policy and a set of guidelines, rules and policies to which the company expects employees to adhere. The consequences of behavior that runs afoul of company policy is explained in the handbook as well as in corrective action that supervisors carry out when they observe poor workplace behavior or poor job performance. Although too many workplace disciplinary policies perpetuate an adult-child relationship where an adult-adult relationship should exist instead, the end result is that discipline in the workplace modifies employee behavior.

Positive Reinforcement

The practice of positive reinforcement in the workplace -- also called the "carrot principle" -- is a form of behavior modification that rewards employees for strong job performance, embracing the workplace philosophy and, essentially, creating a more profitable and successful business. Employers who practice this form of behavior modification generally reward employees with monetary and non-monetary recognition. Positive reinforcement supported by non-monetary employee recognition in the form of job promotions or plum assignments is one of the most effective forms of motivation, according to management consultant and professor Frederick W. Herzberg. Herzberg's two-factor theory concerning workplace hygiene-motivation factors is actually a form of behavior modification. Employee recognition begets motivation which, in turn, is a form of positive reinforcement.

Expectancy Theory

Expectancy theory in the workplace is yet another form of behavior modification, albeit a complex form. According to Yale professor Victor Vroom's expectancy theory, employees engage in certain behavior because it produces a desirable outcome for employees, based on the three components of expectancy theory: "expectancy, instrumentality and valance." For example, an employee may maintain perfect attendance because she expects some form of reward. The instrumentality is that her employer promises that employees with perfect attendance will receive a reward. Valance, the final component, refers to the type of reward the employee receives, such as a gift card, a choice parking space or some other token of appreciation in addition to acknowledgment for her achievement. Nevermind that coming to work every day actually should be an expectation and not the basis for reward, expectancy theory in its truest form underlies behavior modification.

Compensation and Benefits

According to a study of more than 19,000 exit interviews conducted between 1999 and 2003, California's Saratoga Institute discovered that employees don't always cite compensation and benefits as the reasons they resign. They typically leave their jobs because of dissatisfaction that's based on workplace factors such as communication, ineffective leadership and lack of advancement opportunities. Nevertheless, compensation can be an effective form of behavior modification when employers connect performance to compensation in the form of salary and wage increases. Strong performance rewarded with annual raises and year-end bonuses are forms of behavior modification strengthened by an employer's compensation structure.

About the Author

Ruth Mayhew has been writing since the mid-1980s, and she has been an HR subject matter expert since 1995. Her work appears in "The Multi-Generational Workforce in the Health Care Industry," and she has been cited in numerous publications, including journals and textbooks that focus on human resources management practices. She holds a Master of Arts in sociology from the University of Missouri-Kansas City. Ruth resides in the nation's capital, Washington, D.C.

Photo Credits

Digital Vision./Digital Vision/Getty Images

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Advantages in Using Behavior Modification in the Workplace

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A rudimentary definition of behavior modification is encouraging others to behave the way you want, while discouraging the kind of behavior you don't want. The workplace is the ideal setting to examine behavior modification because it occurs in practically all workplace interactions, whether employee-employee ...

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The Life Cycle Theory of Leadership is based on the relationship among follower maturity, leader task behavior, and leader relationship behavior. Leadership style should reflect the maturity level of followers. Apotheker had terrible communication skills with the board and didn’t know what direction the company should go in.

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FORTUNE - A few months after she took over as the CEO of Hewlett-Packard HPQ last September, Meg Whitman held one in a series of get-to-know-you meetings with employees. To say the audience, a group of software engineers and managers, was sullen would be an understatement. As Whitman spoke, many of them glared at her. Others weren't making eye contact with their new boss. Their heads were down, and they were tapping furiously on handheld devices.

"Your comments are being live-blogged," one employee told her defiantly. Whitman challenged the man. "You all have taken leaking to a new art form," she said. "It's a sign of an unhappy company. You wish HP ill." The tapping suddenly stopped, and as the room fell silent, the mobile devices were lowered.

The employees' open contempt for the head of the company and Whitman's acknowledgment of their misery were signs of just how dire things had gotten inside the technology titan after a humiliating series of epic stumbles last year. Just in the few months before Whitman became CEO, there was the costly failed launch of a tablet computer, a mortifying public waffling over whether to spin off the company's giant personal computer business, and then the drumming-out of its third CEO in less than seven years.

If only HP's troubles were confined to a few months in 2011. For a decade now the company has sometimes seemed more like a tawdry reality show than one of the world's great enterprises. The public dysfunction started with the vicious infighting over HP's merger with Compaq in 2002, which reached its nadir when the company's high-profile CEO, Carly Fiorina, pilloried Walter Hewlett, a board member and son of a company founder, for daring to voice his opposition. There was a board riven by feuds - so out of control that some directors were leaking secrets to the press while the chairman of the board was hiring private investigators to obtain their phone records (and those of reporters) to uncover the perpetrators. That bit of skullduggery ended with the company's chairman and its CEO both dragged before Congress to explain themselves under oath. Then came the ouster of the company's putative savior, CEO Mark Hurd, after allegations relating to his interactions with a marketing consultant who had been an actress in risqué movies; both parties absolutely, positively, categorically denied that there was any hanky-panky.

Dr. Phil could fill a month's worth of shows just examining HP's board, whose dynamics have resembled those of rival junior high school cliques more than what is supposed to be a sage guiding force. At times, as we'll see, HP directors have refused to be in the same room with one another and have accused each other of lying, leaking, and betrayal. Time and again they've failed in their choice of CEO - their most important task - selecting a new leader whose most salient trait is that he or she is the opposite of the last one.

All of this has impeded the company from tackling the fundamental problem it faces: Simply put, Hewlett-Packard has lost its way. The company is in the midst of an existential crisis. It remains a behemoth, No. 10 on the Fortune 500, with $127 billion in sales last year and $7 billion in earnings. But the trajectory is ominous. Those profits, for example, were 19% lower in 2011 than in the previous year. HP's business is under siege on almost every front, losing market share and facing declining margins.

It was a combustible mixture: long-term threats to the business combined with an impaired board and an ill-chosen CEO in Léo Apotheker (LAY-o AH-po-teck-er). The three ignited disastrously during the 11 months that the 58-year-old European software executive ran HP. Indeed, there's no better way to understand the company's plight today than to examine his tumultuous tenure. A Fortune investigation reveals that the turmoil of Apotheker's reign was even more intense (hard as that is to believe) than previously reported. From the slapdash hiring of a man with no experience in HP's biggest lines of business, to the half-baked ways in which the company tackled major strategic decisions; from the never-before-reported internal challenges to Apotheker by top executives, to the fact that HP chairman Ray Lane was a major force in the company's strategic decisions - which he has since blamed on Apotheker - the full story of HP's convulsive year has never been told. This article is based on interviews with more than 70 current and former directors, executives, and employees of HP, SAP (where Apotheker once worked), and other companies in the industry, as well as hundreds of pages of company and legal documents, many of them never before made public. (Citing a confidentiality agreement with HP, Apotheker declined to meet with Fortune in Paris, where he now lives.)

With Whitman, 55, now in place, the acrimony at HP seems to have eased. So far her strategy amounts to this: Let's execute better while we figure out our long-term plan. That's fine, as far as it goes. But the company will never come close to reclaiming its former glory unless she and the board can find a way to function together and, most important, until she can answer the real question: What is HP?

The saga of HP's 11 months under Léo Apotheker begins in November 2010. To understand it, you need to appreciate what he found and how HP got to that point. The company seemed strong at that moment, its swagger restored during the five years Mark Hurd had been in charge. Earnings per share had quadrupled. The stock price had doubled. HP was No. 1 in PC shipments, No. 1 in printers, No. 1 in servers.

But just under the surface was a very different reality: HP was traumatized, its employees disengaged. Internal "voice of the company" surveys revealed that morale had cratered. One top executive told Apotheker she felt "maimed" by Hurd's hard-charging style. A company hailed for its vaunted "HP way" - which emphasized employee autonomy - had stifled creativity to the point where workers now had a rueful phrase to describe the way they tuned out and pretended to be clueless when executives asked them to do something: "flipping the bozo bit."

HP was barely innovating. The company didn't boast a single hit consumer product even as 67% of its revenue stemmed from hardware. Apple AAPL had shown the riches awaiting those who invent hit devices. But there were no iPhones or iPads in HP's bland array of products. And Apple was only one rival for HP, whose diverse businesses meant it also competed with enterprise hardware and software companies such as IBM IBM and Oracle ORCL and consultants such as Accenture ACN .

Faced with pressures on every side, HP had seen its numbers begin to slide. After nearly doubling in Hurd's first three years, for example, free cash flow sank from $12 billion in 2008 to $8.4 billion in 2010, his last year.

By contrast, the company HP dreamed of being, IBM, had soared by taking a different tack: It dumped its PC business and focused on high-margin software and services. That prompted what is probably an apocryphal, but telling, anecdote among enterprise techies: Two visiting consultants are waiting for the elevator at a big company's headquarters. One is from HP, the other from IBM. The consultant from Big Blue pushes the up button to visit the CEO on the top floor. The HP man, by contrast, hits the down button to see the IT guy in the basement. The message was clear: IBM was consorting with kings while HP was on hands and knees, fixing the plumbing. It wasn't just a metaphor either: IBM's pretax profit margins, just under 20%, were more than double the 8.7% HP achieved in Hurd's last year.

HP had been operated with an eye toward the short term. Hurd emphasized financial management. Revenues grew largely because of acquisitions - including the Compaq deal, HP bought 86 companies under Carly Fiorina and Hurd - and profits multiplied mostly because of Hurd's ferocious cost-cutting and growth in the PC business.

Hurd's early initiatives to pare spending were valuable and necessary. But as time went on it became harder to find waste, and the results became extreme. Employees practically needed an act of Congress to get approval to buy a piece of software. The headquarters of the tech company did not have Wi-Fi. And some minions took Hurd's edicts to self-defeating lengths. At HP's office in Fort Collins, Colo., for example, the lights shut off automatically at 6 p.m. every day, effectively forcing workers to go home. An intrepid few brought their own lamps to the office, only to be scolded by facilities managers, who told them to remove the lights.

Decay had begun to show in some HP offices. Mice skittered in the corridors. Spiders fell from cracked ceilings. As the company cut back on trash pickups, detritus piled up, and in one location workers took garbage home in their cars. Upon arrival, Apotheker was informed that HP was missing 85,000 chairs. The figure was so farcical that he had to check to make sure it was right. It was. Hurd might not actually have "burned the furniture to please Wall Street," as HP's chairman, Ray Lane, would later disparagingly put it. But the Hurd era's external success had concealed internal deterioration.

Before Apotheker ever came to HP, the company was known for its fractious board. Individual directors would cycle in and out, yet somehow the group seemed constantly divided by personal rivalries, bickering, and leaks to the press.

With his forceful personality and a rising stock price, Hurd, 55, managed to suppress the worst contentiousness. But his departure brought out the sharpest antagonisms in the board. Directors argued for an intense week before announcing Hurd's resignation on Aug. 6, 2010. Technically Hurd was pushed out for false explanations on expense accounts relating to interactions with contractor/actress Jodie Fisher. Despite a letter from Fisher's lawyer charging sexual harassment, the company found no evidence that Hurd had harassed Fisher. What doomed him was the board's view that he had misled them when he initially denied any relationship with Fisher. (A spokesman for Hurd declined to comment on the record; the ex-CEO has previously denied any impropriety, financial or otherwise.) Hurd was replaced on an interim basis by CFO Cathie Lesjak, a two-decade HP stalwart who made it clear she wasn't a candidate for the permanent CEO position.

The board's tensions did not abate when Hurd left. One of the ex-CEO's staunchest allies on the board was Joel Hyatt, the founder of a chain of legal clinics and later the co-founder of Current TV. Hyatt was prickly. He didn't hide his contempt for the two directors who had led the investigation of Hurd, Robert Ryan, an ex-CFO of Medtronic MDT , and Lucille Salhany, the former chairman of Fox Broadcasting. He claimed they had railroaded the former CEO. For their part, Ryan and Salhany couldn't believe how long it had taken their fellow directors to recognize the gravity of what they viewed as Hurd's lies.

There was an almost dizzying array of ambitions and gripes among the directors. Lawrence Babbio, the former vice chairman of Verizon VZ , hoped to be named HP's chairman. John Joyce, a former CFO of IBM, was vying to be president of HP. Several complained that Hyatt had been - and was still - channeling board discussions to Hurd. (Hyatt says his conversations with Hurd were proper and fully disclosed to the board.)

Hoping to mollify Hyatt, the directors named him co-chairman of the committee to pick a new CEO and lead the transition. But Hyatt wasn't placated for long. He was furious to learn that two directors had addressed employees about Hurd's departure without inviting him. "My colleagues aren't interested in my help," he seethed, resigning his title as co-chairman, though he stayed on the committee. When an article detailing the sexual harassment allegations against Hurd appeared, Hyatt accused his fellow directors of leaking. "We took a blood oath" to keep board matters private, he fumed, "and it didn't last 24 hours."

Despite the rancor, the search committee members tried to focus on finding a new CEO. They picked Spencer Stuart's James Citrin to run the search. (Citrin declined to be interviewed for this article.) Smooth, gregarious, wired into the C-suites of the world's biggest companies, Citrin had a network that few could match. He embarked on a two-track search, examining both internal and external candidates.

Four internal aspirants stepped forward. The strongest was Todd Bradley, the head of HP's personal computer group. His group generated $41 billion in annual revenue and had tripled its profitability during his tenure. But Bradley had shortcomings. His critics said he tended to mumble in presentations and was perhaps a bit too cozy with the press. His record as an infighter had made him enemies. Several top executives said they would resign if he were named CEO. For various reasons the other three internal contenders - Ann Livermore, Tom Hogan, and David Donatelli - were also ruled out.

Hurd certainly hadn't made the board's mission easy. At various times when he was CEO he had told three of the internal candidates they were his heir, according to people familiar with the matter. Hurd then turned around and told the board that none of them was ready to be CEO. Needless to say, that left bruised feelings that would ultimately sour relations with the next CEO.

Citrin was keen on Ray Lane, a managing partner of the venture capital firm Kleiner Perkins. Lane had a track record in enterprise software and one of the biggest Rolodexes in the Valley. After a successful turn as Oracle's president in the 1990s, Lane was pushed out by CEO Larry Ellison in 2000. He left an extremely wealthy man but bearing a grudge against his former boss. Lane was tempted by the HP job. But at age 65, he had young kids and other business commitments. He didn't want to work CEO hours and he preferred not to travel much. Lane withdrew after it was made clear that being chief of a $127 billion corporation is all-consuming.

If not Lane, then whom? Citrin was enthusiastic about a former enterprise software CEO, whose career he'd been tracking. But hiring him would take courage. He'd been fired after a short, rocky tenure. HP directors were skeptical. But the more they learned, the more impressed they became.

The man had expertise in enterprise software, an area the board thought HP needed to move deeper into. He spoke five languages and had worked on three continents, a major plus considering that more than 60% of HP's business was now overseas. He was a bold choice, Citrin told the search committee, and if they picked him, they would be remembered for making "one of the best CEO picks ever."

Apotheker's rise had been impressive. He was born in 1953 to Polish refugees who settled in Germany after World War II. His father acquired a textile factory with help from the Marshall Plan. Apotheker spent his first eight years in Aachen, Germany, and then moved to Belgium. He studied international relations and economics in Israel.

In 1988, Apotheker joined SAP SAP , then a small German business software concern, and launched its operations in France and Belgium. Apotheker was a master salesman, deploying cold logic rather than charm. "He could sell ice cream to an Eskimo," says one former deputy. "But he wouldn't just sell ice cream. The customers loved the insights they were getting out of this guy." Apotheker's brilliance and his astute push for key acquisitions such as BusinessObjects helped SAP become an international force. By 2005 he was a contender to become SAP's CEO.

Still, it sometimes seemed as if there were two Apothekers. There was the awkward, self-deprecating version who kept a statue of a clown on his desk, a gift from his children, to remind himself to be humble. And there was the imperious tyrant who could be so overbearing that his enemies dubbed him the Sonnenkönig, the Sun King.

The stories of his nastiness flew around SAP. One poor fellow was only a few sentences into a presentation when Apotheker began bombarding him with questions, according to two people who were present. After several minutes under this fusillade the man sank to the floor, whimpering, "What do you want me to do? What do you want me to do?" Apotheker was capable of absurd flights of invective. "Bring me the liver of that asshole," he raged on one occasion to a stunned deputy, who didn't know whether to laugh or to cry. "I will eat it for breakfast."

Apotheker thought of himself as an honorable man, according to colleagues. But he viewed the world as a place filled with retribution and betrayal, so he was willing to throw an occasional elbow if need be. After all - at least, in his mind - that's what everybody else was doing. Some of the seeds for Apotheker's downfall at HP were planted in precisely that sort of thinking.

It began with a feud between Apotheker's prior company, SAP, and Oracle. As SAP saw it, Larry Ellison's company had barged into its turf - back-office software - in 2004, buying PeopleSoft, and later Siebel and others. Ellison, who seems to revel in psychological warfare, gleefully trashed his rival in public. (An Oracle spokeswoman declined to comment.)

In response, Apotheker led a campaign called Project Apollo. The secret operation was rolled out at SAP's summer sales meeting in July 2005. The goal was to motivate the troops by "highlighting the falsehoods Oracle tells about SAP" and to "demonize Larry Ellison to the field," according to a memo prepared for the event.

The presentation included a video that depicted Ellison's head on a fly's body. It was time, Apotheker said as the fly buzzed above him, to "treat Oracle like the pesky, annoying bug it is." At that point, a can of bug spray was aimed at the fly. "And that is how we intend to treat the annoying lies," Apotheker intoned, "by swatting them away with facts."

But Project Apollo wasn't just a truth squad. It became an expensive and ultimately self-defeating attack strategy. The plans, outlined in SAP documents that emerged in subsequent litigation, included a "disinformation campaign" against Oracle and efforts to "disrupt" its rival.

Apotheker ordered SAP to "exploit" the opportunities "to the hilt." One part of the campaign involved a then-newly acquired software company called TomorrowNow, which provided service for users of PeopleSoft and Oracle software, among others. SAP hoped to use TomorrowNow to lure customers from those companies. The problem was that, as even SAP would later admit, TomorrowNow was able to provide cheap service because it was secretly and illegally downloading software from Oracle.

In 2007, Oracle sued. Apotheker was grilled for eight hours by Oracle's lawyers. He dodged and weaved. He insisted SAP shut down TomorrowNow after it learned of its unethical practices. Apotheker remained bland and vague throughout the deposition. Only when the lawyers read him SAP's "attack plan" to "seek and trash Oracle" did Apotheker flash a rare grin. He shouldn't have been smiling. Within three years the suit would blow up in his face.

In June 2009, Apotheker was promoted from co-CEO to CEO. The world economy remained fragile, and like most companies, SAP was suffering. The company was forced into global layoffs for the first time, infuriating its unions.

Apotheker made things worse for himself. When he was co-CEO, SAP had raised the lucrative fees that it charged to maintain its software. Customers resisted, but even as the economy tumbled into recession, Apotheker wouldn't yield. For months he refused to roll back the increase and squabbled in public with his customers. Only after clients had fled did Apotheker finally relent.

It was too late. In February 2010, SAP's executive chairman and co-founder, Hasso Plattner, called him. After all the hard things that had transpired, Plattner told him over the phone, SAP needed a "new face, a happy face." Apotheker was instructed to leave that day. Stunned, he retreated to his home in Paris and sank into a deep funk. Six months later, Apotheker got a second chance. It was Jim Citrin calling about the CEO job at HP.

Citrin's report on Apotheker largely defended his performance. It quoted insiders saying that the CEO fell victim to a perfect storm of circumstances while trying to make bold strategic changes. The report did mention the botched maintenance hike, but it failed to explain the leadership deficits that undid Apotheker at SAP - faults that would undermine him at HP: his negativity, his nastiness, and his unwillingness to be coached.

The announcement that Apotheker had been named CEO and Lane would be chairman came on Sept. 30, 2010. The Apotheker appointment shocked the tech world. Media reports had predicted the new CEO would be Todd Bradley or Ann Livermore. Within HP, jaws dropped. Léo who? SAP had one-eighth its revenue. For crying out loud, there were HP senior vice presidents who ran units bigger than all of SAP.

For the board, no other candidate had come close. Apotheker had struck just the right notes: He understood the strengths and weaknesses of HP and of key executives; he spoke of the need to restore innovation. True, he was an outsider, but he acknowledged his lack of experience and the board had a solution: Lane, a Silicon Valley blueblood, would guide him. As part of being hired as chairman, Lane had asked who the new CEO would be; he had enthusiastically endorsed Apotheker.

The full board never met Apotheker and Lane before hiring them. As one director told New York Times columnist James Stewart, many were too exhausted by the fighting. Board members did discuss the consequences of hiring two men without hardware backgrounds, but they felt that Bradley and the other HP executives could coach them. They briefly discussed Oracle's litigation against SAP and were assured there was little likelihood Apotheker would become ensnared in it. It was no big deal.

Still, Oracle was emerging as a potential plague for other reasons. Larry Ellison was friends with Mark Hurd and livid at HP's decision to fire him. Ellison publicly accused the board of making "the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago." Only one month after Hurd resigned from HP, Oracle hired him as co-president.

The news exploded inside HP, which had a complex relationship with Oracle. The two companies were competitors - but also partners, sharing some 140,000 customers. Within 24 hours of the news, HP filed suit against Hurd, claiming he had put the company's most valuable trade secrets in peril. (Even that move had unintended consequences inside HP. Its general counsel, Michael Holston, filed the suit without consulting the full board. Director Hyatt was furious. "You did what?" he bellowed at Holston. Hyatt thought it would jeopardize HP's relationship with Oracle.)

When Ellison learned that HP had hired two Oracle antagonists, he swung back into action. The timing of Apotheker's appointment was fortuitous. His first day of work, Nov. 1, coincided with the start of , the trial to assess the size of damages for the theft of Oracle software by SAP's unit, TomorrowNow. Oracle's lawyers announced they planned to subpoena Apotheker if he came within 100 miles of Oakland, where the trial was being held.

Apotheker had just taken the reins of America's largest tech company. Many a new leader would fantasize about riding in on a white stallion, flags flying, to take charge. But Apotheker was advised not to testify. So instead of making a dramatic entrance at HP's Palo Alto headquarters, Apotheker was forced to stay away. He took off on what the company dubbed a "listening tour" of its global empire, visiting offices around the world: the U.K., Germany, France, Brazil, Singapore, New York, and Houston.

It was a PR fiasco. Apotheker was mocked. Bloomberg TV sent a reporter to look for him just outside the 100-mile subpoena service limits. WHERE IN THE WORLD IS LÉO? sneered the crawl at the bottom of the screen. It only got worse when Oracle was awarded $1.3 billion in its suit against SAP. (It was later reduced to $272 million; Oracle rejected the judgment and the suit is going back to trial.) Ellison's company had succeeded in making Apotheker look weak and defensive before he even set foot in Palo Alto.

More: HP's cast of characters

Despite the turmoil, there were fleeting moments when it appeared Apotheker might enjoy a honeymoon at HP. Investors seemed heartened by his first moves. He wanted the personal computer and printer groups to focus more on business-to-business sales, and he sought to move the services operation into higher-margin areas. He planned to focus HP's software on big data analytics, a goal he said could be achieved without expensive acquisitions.

Employee morale started to improve. Apotheker undid salary cuts that had occurred under Hurd. He held a series of town halls and breakfasts. He brought in a European youth orchestra to play for the troops at headquarters. He toured HP's labs and vowed to bring innovation back.

But events quickly turned against Apotheker. In February 2011, just three months after he took over, HP missed its quarterly revenue estimate. Both the PC and services divisions had underperformed. Apotheker directed his ire at himself, to some extent, and even more at HP's CFO, Lesjak. Now the stock was being pounded - down 10% in a day - because the company hadn't delivered.

Then, in March, came a disturbing flare-up in what was starting to look like a long-term conflict with Oracle. HP's frenemy announced it was discontinuing software development for servers that used Itanium chips made by Intel. It was a stick in the eye of HP, the biggest manufacturer of such equipment (which competed with Oracle's servers). The servers generated more than $1 billion in profits for HP. Now the business was imperiled.

Furious, HP filed suit, claiming Oracle's move violated the settlement in the Hurd case, in which the two companies promised to conduct business as usual. The suit brought more bad press, exposing embarrassing documents, which revealed that Intel had tried to discontinue Itanium because the chips were losing money. The reason the company hadn't done so was because it received $690 million in subsidies from HP to keep manufacturing the chips until 2014.

The threat to the Itanium business underscored HP's vulnerability, and it affected Apotheker's thinking. As he pondered the company's strategic direction, he began to see the need for a more fundamental change. In his mind, the company simply couldn't continue with its strategy of being the most cost-effective hardware supplier and making modest incremental investments in software.

Apotheker started to believe that what HP needed was a transformation on an IBM scale, but conducted in a much shorter time frame. HP should spin off its massive but stagnant PC division. And HP needed to really commit to the software business by buying a big data analytics company.

There was also a third major initiative, this one a holdover from the Hurd era. Apotheker's predecessor had purchased Palm Inc. in July 2010 for $1.8 billion - one of his main attempts to fashion a growth strategy. (Hurd also recruited venture capitalist and onetime Internet wunderkind Marc Andreessen to join the board and inject some fresh thinking.) Palm was planning to launch a tablet computer - a product sorely lacking in HP's stable - and it would use a new operating system called webOS. Technology denizens praised the operating system, which raised the prospect that HP could make giant profits on software (rather than letting the big money go to Microsoft (MSFT)). And the buzz on Palm's tablet was good. Maybe, just maybe, HP would have a new hit - a quick infusion of profits and prestige.

But before Apotheker hatched his strategy, he and Lane reshuffled the board. The process was messy and contentious. The media would portray the changes as evidence that Apotheker had taken control of the board. In truth, it was Lane who would consolidate his grip.

In November 2010, the same month Apotheker took over as CEO, the usually silent director Ken Thompson, the former chief of Wachovia, declared at a board meeting that every director should tender his or her resignation. That way Lane could pick which directors to keep. The suggestion shocked some board members, but before they could even respond, general counsel Holston jumped in: Letters of resignation aren't feasible, he told them, since securities laws would require them to be publicly disclosed. So Thompson asked for a show of hands: Who would offer to quit? Most directors raised their arms.

Lane quickly established a committee - Apotheker, Babbio, McKesson CEO John Hammergren, and himself - to decide which heads to lop off. The jockeying began almost instantly. Hammergren wanted to oust Salhany; in return, she viewed him as arrogant and egotistical. Most of the directors couldn't stand Hyatt and pushed for him to be dumped. Three had refused to sit on committees with him; Andreessen had gone so far as to skip an entire board meeting so he wouldn't have to be in the same room with Hyatt.

In late December, Lane asked the two directors seen as Hurd's main defenders, Hyatt and former IBM CFO John Joyce, to step down. Then, "as a matter of balance," Lane told the two directors who had led the Hurd probe, Ryan and Salhany, that they needed to depart also. Ryan and Salhany were upset. They'd invested significant effort in the investigation and felt their work had been vindicated. Why did they have to go? In the end, rather than cause yet another fight, Ryan and Salhany agreed to leave, signing prepared resignation letters.

Once that was accomplished, Lane set about restocking the board. In January 2011, the company announced five new directors. One, Dominique Senequier, CEO of AXA Private Equity, was seen as an ally of Apotheker's. The rest were Lane's picks. The most notable was Meg Whitman. She and Lane had forged a friendship years earlier; as Oracle president he had helped save the day after eBay EBAY experienced a major server crash. Lane later supported Whitman's campaign to be governor of California and, after she lost, helped her get a job at Kleiner Perkins.

Whitman talked to Andreessen, another friend. He told her he thought she'd be an excellent addition to the technology committee and he praised Apotheker as a strategic thinker. To Whitman, the venture sounded interesting and fun. "This is probably a well-run company," she thought. "It's 12 minutes from my house. What could go wrong?"

Plenty was still going wrong at HP in the spring of 2011. On May 4, Apotheker composed a grim e-mail to his top executives. The third quarter was going to be "another tough" one, he wrote. "We must watch every penny and minimize all hiring." Two weeks later the memo turned up in a Bloomberg News article. The memo's grim tone contradicted the sunny message that Apotheker was conveying to Wall Street. The leak forced HP to accelerate its quarterly earnings release, which included news of another pullback of revenue projections. HP shares plummeted. Apotheker was incensed by the leak.

He had wandered into a snake pit. Hurd had fed the rivalries of top executives, claiming that competition and "dynamic tension" inspired better performance. Sometimes Hurd gave multiple executives the same assignment. Everyone knew who was in Hurd's doghouse and pounced on them. He had ridden Vyomesh Joshi, the head of the printer group, particularly hard.

Perhaps because they were used to being dominated by Hurd, few in HP's senior ranks would challenge the CEO directly. Consider Apotheker's attempt, earlier that year, to find a catchy phrase that could define HP. He settled on a head-scratcher: "Everybody on." Instead of opposing the idea, almost every executive told Apotheker it was a great slogan (with at least one whispering behind his back that it was horrible). Only Joshi was willing to speak up. "I don't get this," he told Apotheker when the slogan was unveiled at a meeting. Joshi earned the CEO's wrath. The campaign launched - and promptly bombed. As one tech blog headline described the debut, HP'S "EVERYBODY ON" AD GOES TO THE GRAMMYS, CAUSES NATIONWIDE CRINGING.

It didn't help that HP's divisions were run as separate entities, each with its own marketing, public relations, and finance teams, and each was held responsible for its own performance. There was little incentive to cooperate. It sometimes seemed as if the printer and computer teams were from separate companies. (This could lead to ludicrous consequences. Some HP PCs didn't even have software that would automatically allow them to "talk" to an HP printer.)

Hurd had managed to hold it together. He had an encyclopedic mastery of numbers and details; he knew which functionary to call deep inside the organization to make things happen. He was an energetic and forceful commander - somewhere between Gen. George Patton and the Robert Duvall character in Apocalypse Now. You may not have liked the guy, but by God, you were going to follow his orders.

Apotheker, by contrast, was an outsider with a foreign accent. He carried himself more like a professor of German philosophy. He lacked Hurd's stamina, nodding off the first time he met HP's senior executive team as CEO. Apothecker chuckled at his own droll putdowns of California wines, but nobody else seemed to laugh. And he had a distinctive blend of arrogance - a certainty that the board applauded his every move - combined with a fear that some executives were trying to undermine him.

Apotheker seemed not to trust longstanding HP executives such as Lesjak, Holston, and Bradley, who he had allowed to stay on. They returned the sentiment. And Apotheker alienated some HP veterans by bringing in a coterie of SAP executives who, one HP source says, were "abnormally deferential." One of them, Marty Homlish, who had been SAP's marketing chief and Apotheker's right hand in the Oracle fight, took over marketing at HP. Homlish routinely addressed the CEO as "my lord." It was meant to be funny, but colleagues were taken aback. The practice only accentuated Apotheker's outsider aura.

Apotheker was failing to unite his executives, but he thought he could count on Lane, who had told Apotheker he would manage the board while the CEO focused on running the business. Apotheker considered Lane a friend. The two men had gotten to know each other decades earlier when, long before either had developed an antipathy for Oracle, Apotheker had taken a hiatus from SAP and consulted for Ellison's company.

There were reasons for optimism. HP had decided to increase its investment in the tablet that had come with the Palm acquisition. It was set to go on sale in July, and the webOS software would be used to launch a new line of smartphones, PCs, and printers. No one expected to dethrone the iPad any time soon. But HP's new tablet would give the company a presence in that market.

In May 2011, Apotheker began in-depth discussions with HP's board on his two other initiatives: a software acquisition and the plan to spin off its PC business. Between May 25 and July 21, he held repeated strategy sessions with the board and various committees. But before they could make any decisions, calamity struck: HP's tablet was an unmitigated disaster. It went on sale only to be panned as ungainly, slow, and burdened with a subpar battery. The webOS software performed well. But Apotheker was galled by the failure of HP's hardware. The tech titan had taken a big swing at the hottest new device in the market and whiffed. The failure was so complete that HP began thinking about pulling the tablet entirely.

The disaster added urgency to Apotheker's strategic plans. He had wanted to go big in software; he had a British data company, Autonomy, he wanted to buy. It would be a perfect complement to HP's portfolio, Apotheker argued, because its software - a sort of Google GOOG for corporations that can search voicemail, texts, and video - would bolster HP's software and services offerings.

Apotheker appeared before the board and conceded that it was a tricky deal, one that might hurt HP's stock price in the short run. But then the usually formal CEO made an emotional personal appeal. "This company is a burning platform," he told the directors. HP needed a new vision. He concluded: "I cannot do this alone. I need your support. We're going to have to hold hands and go through this together."

It was a stirring presentation, but it was followed by an even more dramatic moment that blindsided Apotheker. He knew that the CFO, Lesjak, opposed the deal. She had told him the price, around 11 times revenue, was too rich. Comparable companies were selling for three times revenue, according to investment bank Software Equity Group. He'd countered that Autonomy's profitability more than justified the price. The two had discussed it privately.

But then, with no warning to Apotheker, Lesjak made an impassioned case against the acquisition before the board. "I can't support it," she told the directors, according to a person who was present. "I don't think it's a good idea. I don't think we're ready. I think it's too expensive. I'm putting a line down. This is not in the best interests of the company." Directors were shaken. Lesjak was considered a voice of sobriety, and here she was on the verge of insubordination, directly resisting a key element of her boss' strategy.

As the debate over Autonomy unfolded, Apotheker and the board tackled an even bigger decision, one that went to the very heart of what HP is all about: Should they jettison the company's $41-billion-in-sales PC division? Unfortunately, the process by which that decision was made would reflect everything wrong with HP in general and the Apotheker/Lane regime in particular. It was rushed and cursory, first dramatically conclusive - and then uncertain.

In July the board had set up a five-member committee to study the options for the PC division. The committee, which included Babbio, former Lucent CEO Pat Russo, and Ray Lane, held all of two meetings. They didn't even consult Bradley, the head of the division in question. The directors were afraid he would leak the news, so they excluded him.

It was a huge decision, but the board quickly agreed that the spinoff was a good idea. The division's margins were 6% and shrinking. The iPad was eating into the growth of the PC market, raising questions about its future. Apotheker and the directors thought HP could spin off the division and use the cash better elsewhere. Everyone recalled that IBM's sale of its PC division had been a crucial step in its transformation.

But even when the board was decisive, the company couldn't avoid tripping over itself. Lesjak and general counsel Holston argued against announcing definitive plans to unload the division; it might expose HP to shareholder litigation if the plan didn't work out. Because of the fear of leaks, they said, Lane and Babbio's committee hadn't been able to do enough due diligence to assess these impacts. Lesjak and Holston pushed for a weaker statement that HP was considering a spinoff. In part because of the credibility Lesjak had on Wall Street, their voices carried the day.

The activity was frenzied inside HP's executive suites. Apotheker and his top aides were shuttling between groups working on the different initiatives. The CEO himself seemed to be feeling the pressure. After a PR operative told the board that the announcement would be a disaster - there were too many things being trumpeted at the same time and the mealy-mouthed decision to "explore" a PC spinoff would be badly received - Apotheker flew into a rage. He stalked back to his office, violently shoving a chair out of his way, and pounded his desk.

But for all the tension, and the challenges to Apotheker's plans, Lane had marshaled support on the board. The directors were unanimous. On Aug. 18, they approved the Autonomy deal and the plans to explore a PC spinoff. With an investor's call scheduled for later that day, Lane e-mailed Apotheker some tweaks to the final script, which the chairman pronounced "good."

HP'S announcement on Aug. 18, 2011, rocked the tech world. It contained three big pieces of news: the Autonomy deal, the possible PC spinoff, and word that HP was officially ending its multibillion-dollar tablet initiative. For good measure, the company lowered its earnings projections for the year. Apotheker told Wall Street analysts on a conference call that he felt investors' pain, "but as CEO, I believe in transparency about what we are facing and [the need to] be clear on the decisive things we are doing now about it." He and his lieutenants used variations of the word "transformation" 20 times.

After the call, Lane received a congratulatory e-mail from Kleiner Perkins partner John Doerr, praising the big, bold moves. Replied Lane in a reference to HP's founders, "I actually think Bill and Dave would be proud." Inside HP's headquarters, champagne corks were popped.

Outside, the reaction was dire. Customers, investors, employees, and the financial press were all aghast. HP, it seemed, had gone mad. Shares plunged 20% the following day.

At first Lane stood beside Apotheker. "I don't know a single technology company that has succeeded without changing its strategy," he told journalists. But Lane (who declined to be interviewed) quickly began backing away. PC customers were bailing out. Investors were furious that HP was making a major acquisition after Apotheker had said they wouldn't. Behind the scenes, Lane began maneuvering. In mid-September, the CEO failed to appear as scheduled at a tech conference. Lane showed up instead. Apotheker was about to be toppled.

Not for the first time, the news reached the press before the official announcement. On Sept. 22, Apotheker read that he was being fired and replaced by Whitman. He was flabbergasted. In a meeting that morning, Lane told him that he had lost the support of the board and every single member of the executive team - including former SAP loyalists such as Homlish. Before the board, Apotheker was subdued, dignified and resigned. But he was incensed. He had fully consulted with the board on everything, he told friends. He'd trusted Lane to make the board a functioning one, but instead Lane had turned it against him.

Lane distanced himself from the disaster, blaming Apotheker. The man who'd been proud of HP's bold moves was now running as fast as he could from the word "transformation." It had, Lane said in a conference call with investors, "been stricken from our language." Asked in a CNBC interview whether the board bore responsibility for HP's chaos, Lane reacted defensively. "I'm going to give you an answer right from my heart, okay? In January, I added five board members to this board. This is not the board that was around for pretexting. This is not the board that fired Mark Hurd. It's just like open season to write about this board. It's not this board. This board did not select Léo, okay?"

If Meg Whitman had any illusions about the challenges she faces, they were eliminated before she even made it inside HP's office. Driving her Ford Escape to HP's headquarters, she was directed to a special executive committee parking lot that was blocked by a gate and an imposing green fence topped with barbed wire. Whitman stared in disbelief. In her mind there shouldn't have even been an executive parking lot at HP, much less one with concertina wire befitting a military installation or jail.

The fence was a stark reminder of the gulf that had grown between senior leaders and employees. Whitman had it torn out. She also eliminated the executive committee suites and moved the top brass to cubicles. Now, even Whitman has to compete for parking spots and walk in the public entrance like everyone else. Gone also are stays at swank hotels in favor of more modest accommodations.

"It's back to Bill and Dave's culture," Whitman says, acknowledging that these moves were the easy ones. "Symbolism is important. I learned that in politics."

Whitman has moved decisively to make changes in the executive committee. She forced out longtime printer head Joshi, merging his unit into the PC group, and general counsel Holston. Chief strategist Shane Robison retired.

Still, Whitman has already had a few stumbles. HP's first-quarter results were even worse than expected, sending shares skidding. In a call to discuss those earnings, she allowed a touch of hubris to seep into her assertion that she will turn HP around. "I've done this a number of times in my career," she said. "It's what great business leaders do."

For his part, Lane shows no signs of fading into the background. In their first joint interview on CNBC on the day after Whitman was named CEO, Lane dominated the interview, at times filibustering Whitman. He has since told employees he is ready to "take Meg's training wheels off."

For now, anyway, Whitman and Lane's strategy boils down to do what we do - better. One of Whitman's first announcements was to confirm that HP is keeping its PC group. It couldn't be spun out, HP argued, without inflicting significant damage on HP's other businesses. Meanwhile HP's revenues, margins, and cash position continue to deteriorate. The spate of acquisitions, chief among them the Autonomy deal, means the company has little money for new moves. In coming months, tens of thousands of employees are expected to be laid off.

Whitman faces a daunting, though surmountable, challenge in devising a strategy that will put HP on the path to recovery or reinvention. But that's only part of her task. Exorcising HP's demons - in its boardroom, in its executive suites, and among thousands of dispirited engineers and staffers - will be another matter entirely.

This story is from the May 21, 2012 issue of Fortune.

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FORTUNE - A few months after she took over as the CEO of Hewlett-Packard HPQ last September, Meg Whitman held one in a series of get-to-know-you meetings with employees. To say the audience, a group of software engineers and managers, was sullen would be an understatement.

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Employee surveys are a great tool for a company to use if they are done in the right way. i fell that anonymous surveys are just a place for people to vent about their problems that aren't going to help anyone and waste time.

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We live in an era of oversharing. While most people are comfortable sharing what they ate for lunch, what they watched on TV, and what their relationship status is with 500 of their "closest" friends on Facebook and Twitter, the idea of telling their boss what they really think still feels pretty risky.

The traditional feedback process that's become the norm in most businesses today relies on anonymous systems so employees can feel safe being open and honest with their employers. But there's something fundamentally wrong if your employees are fearful to be open when providing feedback.

Meanwhile, leaders worry their employees won't be forthcoming with their opinions unless they're anonymous, so they default to the nameless employee survey, which limits their ability to follow up with employees who have particularly helpful ideas.

The idea of anonymity is outdated and ultimately unproductive. In fact, the confidentiality can interfere with the accountability you're looking to build on your team and lead to other unintended consequences, including:

1. Skewed results. In most organizations, a small minority harbors a tremendous amount of anger toward leadership or their workplace in general. An anonymous survey just gives them a platform to vent. When their names aren't attached, their feedback can be pointed, jaded, and even inflammatory, which can skew your results.

2. Misinterpreted feedback. The purpose of feedback is to gather information to help you make better business decisions. Unfortunately, with unidentified feedback, there's no way to understand the context of issues that may only affect one department or even one employee. You may end up misinterpreting the data, which can cause you to make the wrong decisions.

3. A lack of follow-up. If a respondent has a moment of brilliance in an anonymous survey, you have no way to dig deeper into his ideas or recognize this visionary for his contribution. On the other hand, if an employee is unhappy about something, you miss the chance to have a productive conversation to identify solutions.

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Is Your Anonymous Employee Survey Doing More Harm Than Good?

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The traditional feedback process that's become the norm in most businesses today relies on anonymous systems so employees can feel safe being open and honest with their employers. But there's something fundamentally wrong if your employees are fearful to be open when providing feedback.

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The different types of cultures in a organization. It is best to know what category your employees fall into. incidents can affect different cultures in different ways. as a leader/manager it is best to know the cultures so you can modify the way to make plans.

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Interpersonal communication is a important skill to have. It seems simple but i feel a lot of communication is broken down because of misunderstanding. It is important to clearly explain a task and make sure the person that is receiving understands what is wanted

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Develop your interpersonal communication skills. Learn about the communication processes and how to develop your verbal, nonverbal, listening and other skills.

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Delegation is necessary because you can't do everything yourself. I have personally had problems with delegating because i have been let down and i have not trusted someone, but delegation is something you have to do because as you advance your workload grows and you have to trust that coworkers can help out.

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I have only really worked in a clan type culture. I have worked at my aunts accounting firm where i worked with my actual family, and in the military everyone is like your brother. It has been good to learn about possible workplaces i could work in and how i should adapt.

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I think that companies can find quality executives and managers without using external agencies. A lot of companies like to promote from within because they already know how the company works and they have expectations on the employees because they already know their work ethic. Promoting from within improves staff productivity and morale by letting other employees know that they can keep moving up in the company.

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It has been debated many times, but the question of whether recruitment is best done with internal or external resources can only be answered at an organizational level, based upon a cost-benefit analysis.

When doing this analysis, consider which method of recruitment scores higher on the following metrics:

1. Quality of hire

2. Time to fill

3. Culture fit

4. Candidate experience/impact on EVP

5. Cost

It's time to take a close inspection of each of these areas.

Quality of Hire

Most internal recruiters, at least in medium- to large-sized companies, rely on Web-based systems to do the initial screening and culling of applicants. They lack incentives, and also lack penalties, for how well they recruit. With external recruiters, there are often no metrics in place at all, other than time to fill. If metrics for quality of hire are clearly tracked and compared between internal and external recruiters, it can help identify the best recruitment model for your business because you will be able to tell who is providing the highest-quality candidates.

Linking recruiter pay to quality of hire is a critical step in ensuring that recruiters make solid recommendations to line managers, who ultimately make the hiring decision. Agency recruiters can be measured based on client feedback and the number of times roles have to be re-filled at no charge to the client, which can happen if the wrong hire is made and if the client organization does not have a formal way to measure its recruitment suppliers on this metric.

If you use a hybrid model, consider measuring and comparing both your internal and external recruiters on the quality of new hires. After implementing such a metric, measure them upon their first placement, at six and 12 weeks, again at six months, and then at regular intervals.

Time to Fill

Jobs can often be filled faster by using agencies (particularly within specialized industries) because they have large applicant pools. Good recruiters will always have warm candidates they keep in touch with.

Often, when external recruiters are pre-screening and presenting candidates, it's internal recruiting teams that hold the process up. It's not necessarily their fault, as priorities sometimes change, putting recruitment on hold, or as role requirements are revised, but it speaks to a core challenge facing the recruitment community today.

One key reason recruitment is delayed is that budget for a role has not been approved prior to beginning the search process. As everyone knows, you shouldn't go to market until you're certain you need to fill a role and that money is available to do so. It seems that many companies still retain search firms, spend money on advertising positions, and start seeing candidates without a confirmed internal agreement. This has a decidedly negative impact on both the brand and the relationship with any candidates you have engaged if you withdraw from the process.

A second reason for delaying the process often has to do with how companies operate internally. While a new role may be budgeted, conflicting schedules, agendas, or priorities can mean delays in seeing candidates, or extending the number of interviews or assessments beyond what was originally planned.

Not only does this increase cost and time to fill the role, it also antagonizes candidates and may mean you secure the runner-up instead of your preferred applicant, or worse, you're left with no suitable candidate at all, forcing you to begin the process anew.

If you're using agencies that have pre-screened candidates for you, move those candidates through the internal process, make decisions about individual applicants, and follow up quickly. Given the shortage of candidates in the market, this should be a given.

The need for speed in recruitment, to manage costs and to fill roles, especially empty ones, must be balanced with the need to find the best candidate for the role, considering all aspects, including culture fit.

Culture Fit

Internal recruiters will be able to articulate and respond to questions about what it's really like to work in your company in a way that external parties won't. External recruiters will never know your business as well as your own staff, try as they may, because they don't work in the organization on a day-to-day basis, experiencing all its nuances and political challenges. As a result, many organizations think that recruitment can be done better by an in-house team who know and live the corporate culture and understand stakeholders best.

In the model where external recruiters are placed on-site, they work with your teams every day, but they are still removed from the employee experience to a large degree. For them to hire for culture fit is a particularly difficult task.

One way to track success in this area is to measure culture fit, and there are a number of ways to do that. Compare success rates between your internal and external recruiters to see who is making better assessments of culture fit.

Candidate Experience/Impact on EVP

Every time you go to market under your own brand or someone else's, you send messages about your organization to potential candidates. How you do this could impact the way your firm is perceived by candidates, so understanding the impact of what you do is important.

If you use blind ads through a recruitment firm, you won't build or add to your own brand recognition. Any external agency efforts to co-brand or represent your business must be handled correctly or the brand can be damaged. For example, if external recruiters don't respond to candidates, or not quickly enough, people will forever tie that response to your brand, leaving a negative image in their minds about your company.

Pointing would-be employees to agencies through your careers website makes an impression on candidates about your organization, good or bad. Investments in a career website are better realized if you make the effort to engage with candidates directly at some level. This direct communication puts you in control of your candidate pool and is particularly helpful when there are jobs in the pipeline that haven't been advertised yet.

Cost

An important cost consideration is related to the number of recruits. If you don't hire a lot of people each year, it's probably not worth having in-house recruitment staff. If you do, it's worth measuring the cost effectiveness of outsourcing against the cost of having an in-house team and a well-developed career site with a front- and back-end recruitment system.

Using external recruiters can be expensive if you are a small company and do a large number of hires per year. Invest in some sort of recruitment technology, as well as a good recruiter or two on site who know your business, your brand, and your culture.

Whichever method you choose, or if you use both internal and external recruiters, the most important things to remember are that you need great people for your company, you need them now, and you want to spend as little as possible to get them.

Great candidates don't need your job. Making the process as smooth as possible will go a long way to building relationships with candidates for the long term. Star candidates often have multiple offers, and will move on if you can't make decisions quickly enough, even if they would rather have worked for your firm.

By delaying the process, cancelling searches, and not replying at all, you are sure to damage your employer brand and your reputation in the market.

Laura Randell was most recently Head of organizational effectiveness for Rabobank Australia and New Zealand where she set and led the strategic people attraction and development plan for the organization. Prior to this, she worked with Woolworths, Australia?s largest employer, developing the employer branding strategy for all 14 retail brands. Laura has also worked with major Canadian financial institutions such as RBC Royal Bank and CIBC.

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External vs. Internal Recruiting: Who Does it Better?

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It has been debated many times, but the question of whether recruitment is best done with internal or external resources can only be answered at an organizational level, based upon a cost-benefit analysis. When doing this analysis, consider which method

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As an online shopping website it is best to know what the customers are thinking because you don’t get the face to face interactions. Zappo’s goal is to WOW the customers, which can’t be done without knowing what the customers want and allowing your employees to be independent thinkers. Viewing the employees as potential for greatness you can get a lot of ideas that the consumers don’t even know they want.

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There needs to be a roadmap to guide a business to success. Management must have to ability to identify gaps between budgets and actuals. Management need to be able to course correct accordingly. Budgeting and forecasting go hand in hand, and a majority of businesses need to start understanding this to compete in the very competitive and ever changing world of business.

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"No! Marty! We've already agreed that having information about the future can be extremely dangerous."
What Doc Brown doesn't know about running a business is a lot. While Back to the Future may warn of an altered course of history, in real life having information about the future is vital to running a successful business.

When that business is private equity-backed, the reporting demands of the fund sponsor combined with the narrow margins for optimization make it that much more critical. We even have a word for these future-state assessments: forecasting.

The forecasting season is upon us. But, before we talk about the when (which is now), let's talk about the why, because the lines between budgeting and forecasting seem to have blurred, as have the goals for doing each.

A budget sets detailed targets for the year ahead. A forecast is the latest outlook based on the results. If the yearly budget lays out the plan for where the business wants to go, the quarterly forecast indicates where the business is actually headed (and as such, enables informed near- and medium-term decision making).

The problem is that many companies find the budgeting process - an exercise that has presumably just wrapped up - so laborious and time-consuming that they're reluctant to spend more resources on quarterly forecasting. Or worse, companies create such detailed, granular budgets that they don't deem forecasting necessary.

But they are. Budgets and forecasts are different animals.

The former has an aspirational quality, while the latter is fundamentally rooted in reality. Management can course-correct based on forecasting data, but budgeting contains goals that may not be attainable due to changing market conditions. Forecasting not only captures the material deviations that occur during the year, it arms management (and fund sponsors) with the timely information to evaluate root causes and adjust plans accordingly.

In other words, forecasts are actionable. As such, they can turn the finance team into a proactive and strategic partner to the business.

But, for that to happen, the forecasting process needs to actually happen. And when it does, it needs to be both efficient and accurate - and that's not currently the case. In fact, far from it: only 1% of organizations achieve 90% forecasting accuracy 30 days out. The stat isn't surprising given the four reasons behind it. We call them the forecasting warning flags:

1. Skipped Steps. Herein lie the forecasting non-believers. Those are the companies that believe a detailed budgeting exercise (perhaps combined with monthly reporting) is sufficient enough. The finance team only undertakes forecasting sporadically, or in a reactive manner - when the numbers really don't match up to budgeting expectations. They're skipping steps, but expecting a successful result.

What these companies may not realize is that though budgeting and forecasting are distinct entities, one doesn't work well without the other. They are part of a symbiotic relationship.

In business-speak, we call it an integrated budgeting and forecasting process. The budgeting cycle should begin toward the end of the summer, with finalization in December.

The forecasting, which should begin now (at quarter's end in April, and then again at each quarter end), not only measures against budgetary expectations, it feeds into next year's strategic budget planning.

Bottom Line: Budgets informed by prior forecasts make for more accurate budgets. Skipping steps leads to inaccuracies all around.

2. The Devil's (Not) in the Details. Minding the details is a cardinal rule of business. Forecasting may be the lone exception to that rule. In a forecasting effort, more details aren't better; in fact they're worse. More details:

Require such a significant time and resource investment that they discourage a quarterly process

Create an inefficient, delayed timeline

Impact action-ability by obscuring the big picture learnings and key takeaways

Good forecasting usually follows the 80/20 rule, which estimates that 20% of a company's drivers are responsible for 80% of the company's results. In which case, if the finance team focuses forecasting efforts on the 20%, limiting time and effort on the rest, its forecasts will not only be more digestible, but certainly more timely and likely more accurate.

Bottom Line: Searching for forecasting granularity is a fool's errand. Save the details for the budget; forecasting provides the big-picture view.

3. Data Talks: Is Finance Listening? We're in in the middle of a data revolution, and yet we often see companies ignoring real-time metrics in favor of historical data. Or, we see companies consumed by the explosion of data, unsure of which metrics best inform forecasting projections.

Good forecasts turn data into information and then into insight. But, to complete that transition, the finance team needs to identify, leverage, and integrate the right data sets and ignore the superfluous ones. There needs to be the right balance of internal metrics (visibility into revenue, market share, customer drivers) and external metrics (understanding of sector, macroeconomic tailwinds, competition) to forecast with enhanced accuracy.

Bottom Line: It's about the right balance of the happening-right-now internal and external metrics. And then it's about turning those metrics into actionable analytics.

4. It's a Duet, Not a Solo. But only finance is singing. The forecast should be a joint business-finance creation. Too often, finance is dictating, not participating.

The reasons for that may be two-fold. It may be that finance feels territorial over the output or process, in which case finance will have won the ownership battle only to lose the accuracy war. There's never been an accurate forecast that hasn't been informed by the risk and opportunity, revenue optimization, and management insights of the business teams. Business teams have their eyes and ears closest to the action. They are key stakeholders in the process and outputs.

Or, it may be that finance's ownership is by default - business units push back on joint forecasting development, fearing a prolonged investment of time and resources. It's a rational fear; the forecasting process is often unwieldy and inefficient.

Here, it is finance's job to transform the forecasting approach: redesign the timeline, the scope, and the process to make it less burdensome on the business (which, as a bonus, also makes it more accurate in its outcome). Finance might also emphasize to business partners the conflict-free nature of the forecasting process (relative to budgeting), given the absence of compensation implications.

Bottom Line: Establishing forecasting best practices will not only yield greater partnership in a forecast's creation, but will lead to a forecasting process that's more aligned to business strategy.

They may not need roads where Doc and Marty are going, but businesses need roadmaps. Management must have the ability to identify gaps between budgets and actuals, and course-correct accordingly (or alert the owners where that course-correction is not abundantly clear). Fund sponsors must have accurate visibility into portfolio performance, prior to year-end close. The demand is loud and clear. Will finance deliver?
Ashish Pareek is a director at Accordion, the private equity financial consulting firm focused on the office of the CFO.

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"No! Marty! We've already agreed that having information about the future can be extremely dangerous." What Doc Brown doesn't know about running a business is a lot. While Back to the Future may warn of an altered course of history, in real life having information about the future is vital to running a successful business.

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well structured with predetermined rules regarding the decision-making process, programmed decisions may also be repetitive or routine as their outcome was successful in the past. It is best to have proper training on company policy and a jobs scope of practice in order to make the correct decisions without having to think on the spot or go out looking for answers.

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What Is the Difference Between Programmed & Unprogrammed Decisions From a Business Perspective?

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The act of decision making from a business perspective is choosing an option from a list of alternatives that benefits the business the most. A decision made in business sometimes comes easily to a manager because it relates to a situation encountered before; this is a programmed decision.

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The planning process is crucial in anything you do. failing to plan is planning to fail. It it the most important part in doing anything to reach goals.

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I do recommend that In-N-Out Burger consider expanding the business to the East Coast. In-N-Out Burger is consistently expanding already by now being available in six states in total so far. However the competition from other fast food restaurant chains is proof that expansion can work and you can still keep the quality that they strive to maintain

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Flickr/punctuated

Fans of In-N-Out have been begging the chain for years to open restaurants on the East Coast.

The fast-food chain, which is based on the West Coast, has slowly expanded eastward over its 70-year lifetime to Nevada, Arizona, Utah, and more recently to Houston, Texas. The company has also been holding "pop-up shops" around the world, where burgers tend to sell out within minutes .

All signs seemingly point to a plan for expansion.

But four major factors make it highly unlikely that East Coasters will get to experience the joy of an In-N-Out in their neighborhood anytime soon.

Here's why:

1. Quality control: There are no freezers or microwaves in In-N-Out restaurants because the company has a strict policy of serving its food fresh. Therefore, all locations must be within 300 miles of the company's distribution facilities.

I Am Second

"At In-N-Out Burger, we make all of our hamburger patties ourselves and deliver them fresh to all of our restaurants with our own delivery vehicles," In-N-Out vice president of planning and development Carl Van Fleet told Business Insider in a previous interview. "Nothing is ever frozen. Our new restaurant locations are limited by the distance we can travel from our patty-making facilities and distribution centers."

2. Exclusivity: Everything has more appeal when it's not available to everyone, and the exclusivity of In-N-Out has helped the restaurant gain such a rabid following of fans.

In response to pleading from a local politician for an In-N-Out to open in Denver, Van Fleet made it clear the company was not planning to expand farther east.

Yelp

"You continue to give us the biggest compliment possible with your efforts to interest us in Colorado," he wrote in a letter obtained by The Denver Post. "That said, at this time, we're still not looking to add a sixth state and we're just focusing our growth efforts in the five states where we currently operate."

Since then, In-N-Out has expanded to Oregon - which is the chain's sixth state of operation.

3. Competition: The East Coast has numerous burger joints that would offer tough competition for In-N-Out, including Shake Shack and Five Guys.

4. No franchising: In-N-Out President Lynsi Snyder has said the company will "never" go public or franchise its restaurants.

"The only reason we would do that is for the money, and I wouldn't do it,"Snyder told CBS.

"M y heart is totally connected to this company because of my family, and the fact that they are not here - I have a strong tie to keep this the way they would want it."

A large-scale expansion without franchising would require a massive amount of up-front capital from the company.

"In-N-Out remains privately owned and the Snyder family has no plans to take the company public or franchise any units," the company reaffirms on its website.

SEE ALSO: Everything we know about In-N-Out's reclusive 35-year-old president who just became one of the youngest billionaires in America

NOW WATCH: Here's what happened when I ordered Shake Shack's secret menu burger

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Why In-N-Out Burger won't expand to the East Coast

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Fans of In-N-Out have been begging the chain for years to open restaurants on the East Coast. The fast-food chain, which is based on the West Coast, has slowly expanded eastward over its 70-year lifetime to Nevada, Arizona, Utah, and more recently to Houston, Texas.

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This was a great topic to read about. As you do business in other parts of the world you need to know the customs and cultures of where you are going. I have had special training in the military about being in other countries because you don't want to be considered disrespectful and unknowingly doing it.

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National Culture

Professor Geert Hofstede conducted one of the most comprehensive studies of how values in the workplace are influenced by culture. He defines culture as "the collective programming of the mind distinguishing the members of one group or category of people from others".

The six dimensions of national culture are based on extensive research done by Professor Geert Hofstede, Gert Jan Hofstede, Michael Minkov and their research teams.

The application of this research is used worldwide in both academic and professional management settings.

Dimensions of national culture:

The Hofstede model of national culture consists of six dimensions. The cultural dimensions represent independent preferences for one state of affairs over another that distinguish countries (rather than individuals) from each other.

The country scores on the dimensions are relative, in that we are all human and simultaneously we are all unique. In other words, culture can only be used meaningfully by comparison. The model consists of the following dimensions:

Power Distance Index (PDI)

This dimension expresses the degree to which the less powerful members of a society accept and expect that power is distributed unequally. The fundamental issue here is how a society handles inequalities among people.

People in societies exhibiting a large degree of Power Distance accept a hierarchical order in which everybody has a place and which needs no further justification. In societies with low Power Distance, people strive to equalise the distribution of power and demand justification for inequalities of power.

Individualism versus Collectivism (IDV)

The high side of this dimension, called Individualism, can be defined as a preference for a loosely-knit social framework in which individuals are expected to take care of only themselves and their immediate families.

Its opposite, Collectivism, represents a preference for a tightly-knit framework in society in which individuals can expect their relatives or members of a particular ingroup to look after them in exchange for unquestioning loyalty. A society's position on this dimension is reflected in whether people's self-image is defined in terms of "I" or "we."

Masculinity versus Femininity (MAS)

The Masculinity side of this dimension represents a preference in society for achievement, heroism, assertiveness, and material rewards for success. Society at large is more competitive. Its opposite, Femininity, stands for a preference for cooperation, modesty, caring for the weak and quality of life. Society at large is more consensus-oriented.

In the business context Masculinity versus Femininity is sometimes also related to as "tough versus tender" cultures.

Uncertainty Avoidance Index (UAI)

The Uncertainty Avoidance dimension expresses the degree to which the members of a society feel uncomfortable with uncertainty and ambiguity. The fundamental issue here is how a society deals with the fact that the future can never be known: should we try to control the future or just let it happen?

Countries exhibiting strong UAI maintain rigid codes of belief and behaviour, and are intolerant of unorthodox behaviour and ideas. Weak UAI societies maintain a more relaxed attitude in which practice counts more than principles.

Long Term Orientation versus Short Term Normative Orientation (LTO)

Every society has to maintain some links with its own past while dealing with the challenges of the present and the future. Societies prioritize these two existential goals differently.

Societies who score low on this dimension, for example, prefer to maintain time-honoured traditions and norms while viewing societal change with suspicion.

Those with a culture which scores high, on the other hand, take a more pragmatic approach: they encourage thrift and efforts in modern education as a way to prepare for the future.

In the business context, this dimension is referred to as "(short-term) normative versus (long-term) pragmatic" (PRA). In the academic environment, the terminology Monumentalism versus Flexhumility is sometimes also used.

Indulgence versus Restraint (IVR)

Indulgence stands for a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun. Restraint stands for a society that suppresses gratification of needs and regulates it by means of strict social norms.

♦ Try our Country Comparison tool or compare your personal preferences to the scores of a country of your choice, with Culture Compass™ ♦

About the research

Professor Geert Hofstede conducted one of the most comprehensive studies of how values in the workplace are influenced by culture. He analysed a large database of employee value scores collected within IBM between 1967 and 1973.

The data covered more than 70 countries, from which Hofstede first used the 40 countries with the largest groups of respondents and afterwards extended the analysis to 50 countries and 3 regions.

Subsequent studies validating the earlier results include such respondent groups as commercial airline pilots and students in 23 countries, civil service managers in 14 countries, 'up-market' consumers in 15 countries, and 'elites' in 19 countries.

In the 2010 edition of the book, "Cultures and Organizations: Software of the Mind", scores on the dimensions are listed for 76 countries, partly based on replications and extensions of the IBM study on different international populations and by different scholars.

Start your Cultural journey today

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Professor Geert Hofstede conducted one of the most comprehensive studies of how values in the workplace are influenced by culture. He defines culture as "the collective programming of the mind distinguishing the members of one group or category of people from others".

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companies that expand to other nations start to see problems they aren't used to seeing. Different currencies, different languages, and a greater need for improving communication.

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Learning about how Mariott Hotels started off and expanded to become a huge multinational corporation was great. By following the original owners ideas of ethics this chain has expanded exponentially.

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"We may have been a little too optimistic about how fast we could get this thing closed," Sorenson said Thursday.

Marriott and Starwood - like other hotel chains - own very few individual hotels. Instead they manage or franchise their brands to hundreds of individual owners, often real estate development companies. Those individual hotel owners are responsible for setting nightly room rates. It isn't uncommon for a developer to own a Marriott, Hilton, Hyatt and Sheraton in the same city.

The purchase gives Marriott more leverage with corporate travel departments who often look for one giant chain to house all of their employees. It also gives Marriott more power over Expedia and Priceline, the two giant online travel agencies that sell rooms on behalf of hotel companies in exchange for a commission. The hotel industry has spent the last year trying to get travelers to book directly with them instead of the travel agencies to avoid paying those fees.

There are still many details to work out.

Marriott has thrived as an "asset light" company, owning a handful of hotels. Starwood has been selling off properties, while singing long-term management agreements for those same hotels. As of June 30, it still owned 23 properties. Sorenson said he believes there is a strong market to continue selling off many of those iconic hotels.

"There is always a market for the St. Regis in New York," he said, adding that other assets in the portfolio have comparable stature. "In great global cities, real estate like that always has a value."

The new company will keep Marriott's Bethesda, Maryland headquarters but hasn't announced if it will keep any presence at Starwood's Connecticut or New York offices.

Then there are the 30 brands. Some have performed better than others but Sorenson said all of them will probably survive the merger.

"I think so. Every one of them has hotels in them," he noted.

For now, Starwood and Marriott will keep separate loyalty programs. Starwood has a credit card deal with American Express as well as close partnerships with Delta Air Lines and Uber. Marriott has a much larger program with partnerships with Chase and United Airlines.

"Nothing changes immediately. We have to see how those partnerships evolve," Sorenson said.

Gary Leff, who writes about points and miles at ViewFromTheWing.com, called the three-to-one exchange rate of Starwood points to Marriott points "just right."

"It's one of the many reasonable and positive steps that Marriott has taken along the way as it acquires Starwood," Leff said. "But there's a whole lot still to happen between now and the programs actually being combined."

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Marriott buys Starwood, becoming world's largest hotel chain

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"We may have been a little too optimistic about how fast we could get this thing closed," Sorenson said Thursday. Marriott and Starwood - like other hotel chains - own very few individual hotels. Instead they manage or franchise their brands to hundreds of individual owners, often real estate development companies.

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Corporate Governance is very important. Deciding how a business is run and how certain situations are handled. The code of standards, ethics and conduct is a very important document made within the company to uphold the values that make GameStop great.

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Multi-Generation workforce is very important to understand. People of all ages can bring many things to the table. In a very competitive world it is best for companies to be relevant to the most people. Having diversity doesn't just make a company look like what they are doing is right, it helps the company grow.

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Diversity and diversity training is crucial for any workplace to employ and teach. Diversity was a mandatory training every year when i was in the military. There are computer classes and face to face classes on how diversity is for the best. Having people from all over the world, different backgrounds, races, religion, and ages make a huge melting pot of ideas that can be used to further any business

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Steve Jobs CEO
I believe Steve Jobs is one of the best CEO’s because he was able to bring new ideas that were unheard of at the time and make a company that is one of the world’s most valuable companies. There is a rhetorical question I have heard a lot in my life “would you rather be feared or loved?” No matter what you do there will always be someone who doesn’t like it. If you are too relaxed then people see a soft spot and try to take advantage. If you are too hard on people then they let personal feelings get in the way and you can miss out on a lot opportunity. It a double edged sword that is tough to be what everyone wants. I think that Steve Jobs had a vision and he believed in what he was doing and would do anything to accomplish it. After reading the articles there are several occasions that make Steve Jobs sound like a jerk but he was only doing what he had to, and it paid off. I personally may not agree with his behavior towards employees but he was a very effective manager and CEO.

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Henri Fayol's "14 Principles of Management" have been a significant influence on modern management theory. His practical list of principles helped early 20th century managers learn how to organize and interact with their employees in a productive way.

Although the 14 Principles aren't widely used today, they can still offer guidance for today's managers. Many of the principles are now considered to be common sense, but at the time they were revolutionary concepts for organizational management.

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Today's managers have access to an amazing array of resources which they can use to improve their skills. But what about those managers who were leading the way forward 100 years ago?

Managers in the early 1900s had very few external resources to draw upon to guide and develop their management practice. But thanks to early theorists like Henri Fayol (1841-1925), managers began to get the tools they needed to lead and manage more effectively. Fayol, and others like him, are responsible for building the foundations of modern management theory.

Background

Henri Fayol was born in Istanbul in 1841. When he was 19, he began working as an engineer at a large mining company in France. He eventually became the director, at a time when the mining company employed more than 1,000 people.

Through the years, Fayol began to develop what he considered to be the 14 most important principles of management. Essentially, these explained how managers should organize and interact with staff.

In 1916, two years before he stepped down as director, he published his "14 Principles of Management" in the book " Administration Industrielle et Générale." Fayol also created a list of the six primary functions of management, which go hand in hand with the Principles.

Fayol's "14 Principles" was one of the earliest theories of management to be created, and remains one of the most comprehensive. He's considered to be among the most influential contributors to the modern concept of management, even though people don't refer to "The 14 Principles" often today.

The theory falls under the Administrative Management school of thought (as opposed to the Scientific Management school, led by Fredrick Taylor).

Fayol's 14 Principles of Management

Fayol's principles are listed below:

1. Division of Work - When employees are specialized, output can increase because they become increasingly skilled and efficient.

2. Authority - Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility.

3. Discipline - Discipline must be upheld in organizations, but methods for doing so can vary.

4. Unity of Command - Employees should have only one direct supervisor.

5. Unity of Direction - Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated.

6. Subordination of Individual Interests to the General Interest - The interests of one employee should not be allowed to become more important than those of the group. This includes managers.

7. Remuneration - Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation.

8. Centralization - This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance.

9. Scalar Chain - Employees should be aware of where they stand in the organization's hierarchy, or chain of command.

10. Order - The workplace facilities must be clean, tidy and safe for employees. Everything should have its place.

11. Equity - Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate.

12. Stability of Tenure of Personnel - Managers should strive to minimize employee turnover. Personnel planning should be a priority.

13. Initiative - Employees should be given the necessary level of freedom to create and carry out plans.

14. Esprit de Corps - Organizations should strive to promote team spirit and unity.

Fayol's Six Functions of Management

Fayol's six primary functions of management, which go hand in hand with the Principles, are as follows:

Key Points

Henri Fayol's "14 Principles of Management" have been a significant influence on modern management theory. His practical list of principles helped early 20th century managers learn how to organize and interact with their employees in a productive way.

Although the 14 Principles aren't widely used today, they can still offer guidance for today's managers. Many of the principles are now considered to be common sense, but at the time they were revolutionary concepts for organizational management.

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Henri Fayol's Principles of Management: Early Management Theory

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Today's managers have access to an amazing array of resources which they can use to improve their skills. But what about those managers who were leading the way forward 100 years ago? Managers in the early 1900s had very few external resources to draw upon to guide and develop their management practice.

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This management skill triangle is a very simple yet explains a lot about what is needed at each level of management. As you move up the chain of command you need to fine tune you technical skills, then work on your human skills, and finally conceptual skills. All three are very important to be a successful.

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An IBM Success Story: Rodney Adkins. When I was in the military all my supervisors always told me that it was important to have a mentor to help me with my advancement and job performance. The article in the textbook was just reinforcement that that applies in any job you have. It's always important to have someone help provide insight on what could be best for your future at whatever company or profession you decide to go into.