Question

Henry Fayol divided the activities of an industrial undertaking into six groups, including:

I. Managerial activities (POCCC).

II. Administrative activities (Security, Accounting).

III. Commercial activities (Buying, Selling, Exchange).

Which of the following correctly identifies the groups?

• A. I and II only
• B. I and III only
• C. II and III only
• D. I, II, and III

Answer 1

Answer:

B. I and III only

Henri Fayol's Classification of Business Activities

Henri Fayol, a prominent management theorist, proposed a classification of business activities into six distinct groups. These groups were identified in his seminal work, 'General and Industrial Management'.

Fayol's Six Groups of Activities:

• Technical Activities: These relate to the production of goods and services.
• Commercial Activities: Encompasses activities like buying, selling, and exchange of goods.
• Financial Activities: Involves the acquisition and optimal utilization of capital.
• Security Activities: Focuses on the protection of property and persons within the organization.
• Accounting Activities: Pertains to maintaining records, cost accounting, and statistical information.
• Managerial Activities: This is Fayol's core focus, often summarized by the acronym POCCC (Planning, Organizing, Commanding, Coordinating, and Controlling). These activities are crucial for directing and managing the other five groups.

Context for Competitive Exams:

• Fayol's classification helps in understanding the diverse functions within an organization.
• The distinction between Managerial (POCCC) and other operational/support activities is a key concept.
• Commercial Activities (buying, selling) and Managerial Activities (POCCC) are often highlighted in questions related to Fayol's principles.
• Questions may test the ability to differentiate between these groups or identify which activities fall under each category.