✅ 1.

Cover Page
Business Studies Project (2025–26)

Project Title: Sub-Par Efficiency: A Study of Henri Fayol’s Principles at Subway

Submitted by:
Name: Parth Devnani
Class: XII – Commerce A
Roll No.: 23
Subject: Business Studies (054)

School Name: _______________________

Submitted to: _______________________

CBSE | Academic Year 2025–26

✅ 2. Certificate
CERTIFICATE

This is to certify that the Business Studies Project titled “Sub Par Efficiency: A Study of Henri
Fayol’s Principles at Subway” is a bonafide work of Parth Devnani, Roll Number 23, of Class
XII – Commerce A, submitted in partial fulfillment of the requirements of the CBSE Senior
Secondary Examination for the academic year 2025–26.

This project has been carried out under my guidance and supervision. It is her original work and
has not been submitted elsewhere.

Signature of the Teacher: __________________

Name of the Teacher: _____________________
Designation: ____________________________

School Seal

Date: ___________________

✅ 3. Acknowledgement
ACKNOWLEDGEMENT
I would like to express my sincere gratitude to my Business Studies teacher, [Link]
ANTHONY, for their constant support, valuable insights, and encouragement throughout the
development of this project. This study on Henri Fayol’s management principles applied at
Subway would not have been possible without their guidance.

I am also thankful to the Subway management and staff at [Location/Outlet], who allowed me
to observe their operations and shared insights into their business practices.

I express heartfelt thanks to my parents and classmates for their help, motivation, and feedback.

Lastly, I acknowledge the CBSE Board for introducing such a practical component in the
curriculum, which allowed me to connect theoretical knowledge with real-world observations.

Parth Devnani
Class XII – Commerce B
Roll No. 3

✅ 4. Index
S. No. Content Page No.
1 Cover Page i
2 Certificate ii
3 Acknowledgement iii
4 Index iv
5 Introduction 1
6 Objective of the Study 2
7 About the Organization – Subway 3
8 Henri Fayol – Life and Contributions 5
9 Fayol’s 14 Principles – Theoretical Framework 7
10 Application of Principles at Subway (Observation) 10
11 Findings and Analysis 18
12 Challenges Faced 20
13 Conclusion 21
14 Bibliography 22
15 Appendix 23

📖 5. Introduction
Management is the backbone of any successful organization. It streamlines processes, defines
roles, boosts efficiency, and drives consistent performance. In a globalized, fast-paced business
environment, structured management is not a luxury, but a necessity.
Henri Fayol, a pioneer in management theory, introduced 14 Principles of Management that
continue to guide businesses worldwide. These principles focus on clarity, efficiency, unity,
discipline, and employee motivation – values that form the foundation of modern organizational
behavior.

This project explores the practical application of Fayol’s principles in the real-world setting of
Subway, one of the world’s leading fast-food restaurant chains. Known for its Sub Par burgers
and global presence, Subway’s operations offer an excellent case study of structured
management in action.

By analyzing how each of Fayol’s principles is reflected in Subway’s day-to-day activities, this
project attempts to bridge the gap between classroom theory and business practice, offering
insights into how timeless management principles are still relevant in the 21st century.

🎯 6. Objective of the Study

The primary objective of this project is to understand and analyze the application of Henri
Fayol’s 14 Principles of Management in a real-life business environment. Specifically, this
study is based on observations made at a local Subway outlet.

The key objectives of this study are:

1. To understand each of Fayol’s principles in detail.

2. To identify real-time instances of these principles at Subway.
3. To analyze the benefits and limitations of implementing these principles in a fast-paced
service industry.
4. To observe employee behavior, customer interaction, organizational hierarchy, and
operational flow.
5. To develop managerial insights and evaluate the effectiveness of classical principles in
the modern context.
6. To encourage experiential learning by conducting field visits, interviews, and
observations.

🍔 7. About the Organization – Subway

Subway is a globally recognized fast-food chain, known for its iconic Whopper burgers, Sub
Par offerings, and efficient service model. The brand was founded in 1954 in the United States
and entered the Indian market in 2014 through a partnership with Everstone Capital, under the
entity Subway India Pvt. Ltd.
As of 2025, Subway India operates over 400 outlets across major cities, offering vegetarian and
non-vegetarian options tailored to Indian tastes. With a focus on speed, hygiene, customer
satisfaction, and consistency, Subway maintains a highly structured and process-oriented
working model.

For the purpose of this project, observations were conducted at the Subway outlet located at
[Insert Local Mall/Location], which employs approximately 20–25 people including shift
managers, crew members, and cleaning staff.

The store operates from 10 AM to 11 PM, serving over 500+ customers daily. The outlet
follows international standards of operation, while also being locally responsive. It was selected
for this study due to its well-defined roles, clear hierarchy, and implementation of standard
operating procedures – a perfect ground to observe Fayol’s principles in action.

👨‍🏫 8. Henri Fayol – Life and Contributions

Henri Fayol (1841–1925) was a French mining engineer turned industrialist who is widely
regarded as one of the founding fathers of modern management theory. Unlike Frederick Taylor
who focused on shop-floor efficiency, Fayol concentrated on top-down organizational
management.

Fayol’s most significant contribution was his 14 Principles of Management, first introduced in
his book “General and Industrial Management” published in 1916. These principles aimed to
provide universal guidelines for effective administration and are still applicable across sectors.

He was also the first to categorize management into five core functions:

1. Planning
2. Organizing
3. Commanding (Directing)
4. Coordinating
5. Controlling

Fayol’s philosophy was that management is a teachable discipline and not just an art passed
through experience. His principles stressed the need for a structured, disciplined, and humane
approach to business administration. Unlike many abstract thinkers, Fayol's ideas were born out
of real-world experience — he served as the Managing Director of a large mining firm,
Comambault Mining, where he successfully implemented these ideas.

📚 9. Fayol’s 14 Principles – Theoretical Framework

Henri Fayol identified 14 principles that he believed were universally applicable to all types of
organizations, whether private or public. These principles form the foundation of classical
management theory and emphasize both efficiency and human values. Below is a detailed
explanation of each principle:

1. Division of Work

“Specialization increases output by making employees more efficient.”

This principle states that work should be divided among individuals and departments to ensure
that effort and attention are focused on specific tasks. Specialization leads to higher efficiency
and productivity.

2. Authority and Responsibility

“Authority is the right to give orders and the power to exact obedience.”
Managers must have the authority to give orders, and this authority must be balanced with
responsibility. A proper balance ensures discipline and accountability.

3. Discipline

“Discipline is essential for the smooth functioning of an organization.”

Employees must obey and respect the rules of the organization. Good supervision, clear
agreements, and judicious application of penalties promote discipline.

4. Unity of Command

“An employee should receive orders from one superior only.”

This principle prevents confusion and conflict. When an employee reports to only one manager,
there is clarity in instructions and responsibilities.

5. Unity of Direction

“One head and one plan for a group of activities having the same objective.”
Activities with similar goals should be grouped under one leader. This ensures coordination,
alignment, and goal clarity.
6. Subordination of Individual Interest to General Interest

“The interests of the organization must prevail over personal interests.”

Personal goals should not override the overall objectives of the enterprise. Teamwork and shared
vision must be encouraged.

7. Remuneration

“Workers must be paid fairly for their services.”

Compensation should be fair and satisfactory to both employees and the company. It should
reward contribution and ensure job satisfaction.

8. Centralization and Decentralization

“There must be a proper balance between authority concentrated at the top and authority
dispersed throughout the organization.”
Centralization refers to concentration of decision-making authority, while decentralization allows
more autonomy. The ideal situation is a balanced structure.

9. Scalar Chain

“A clear line of authority from top to bottom.”

Also known as the "chain of command", this defines a formal hierarchy. Communication should
follow this chain, unless an emergency demands direct horizontal communication (Gang Plank).

10. Order

“There should be a place for everything, and everything in its place.”

Both material order (proper arrangement of resources) and social order (right person in the
right job) are essential for smooth functioning.

11. Equity

“Employees should be treated kindly and fairly.”

Managers should be just and impartial. Equity fosters loyalty and devotion among employees.
12. Stability of Tenure

“High employee turnover is inefficient.”

A stable workforce ensures long-term success. Frequent transfers or retrenchments should be
avoided.

13. Initiative

“Employees should be encouraged to take initiative.”

Encouraging employees to develop and execute plans fosters innovation and ownership.

14. Espirit de Corps

“Team spirit enhances harmony and unity within the organization.”

This principle emphasizes morale and unity. Strong team bonds result in better collaboration and
work culture.

These principles are timeless and form the basis of modern business management. In the next
section, we will observe how Subway applies each of these principles in its daily functioning.

10. Application of Fayol’s 14 Principles of Management at

Subway (Observation-Based Study)
This section details how the 14 principles of Henri Fayol are reflected in the operational and
managerial practices at a Subway outlet located at [insert specific location]. The data is derived
from direct observation, informal staff interaction, and documented service procedures during
visits.

1. Division of Work

At Subway, roles and responsibilities are clearly segmented. Team members are assigned
specific stations: grill, fry, order taking, cleaning, inventory, or customer service. Each employee
becomes skilled at a particular task, reducing errors and improving speed. This specialization
allows the outlet to serve large customer volumes efficiently during peak hours.

Example: The grill operator focuses only on preparing patties, while another employee is
designated to toast buns and assemble burgers.
2. Authority and Responsibility

The outlet manager has clear authority to assign shifts, approve breaks, and manage customer
complaints. Shift supervisors oversee staff performance and can issue instructions or warnings if
needed. Every managerial authority is coupled with responsibility to ensure smooth operation.

Example: A shift manager authorizes an early break for a team member due to illness but
simultaneously ensures staffing coverage by rearranging the schedule.

3. Discipline

Subway enforces a strong code of conduct. Employees follow a uniform dress code, hygiene
protocols, and punctuality standards. Non-compliance results in verbal or written warnings.
Regular briefings and training ensure awareness of rules.

Example: An employee who consistently arrives late is issued a formal warning after two verbal
notices, as per store policy.

4. Unity of Command

Each employee reports to one supervisor during their shift. Orders come from the shift manager
only, avoiding confusion or conflict. This ensures clarity in task execution and eliminates
overlapping instructions.

Example: A new recruit working on fries receives instructions solely from the designated floor
supervisor and not from other team leads.

5. Unity of Direction

The entire staff works toward a single goal during each shift — timely service, customer
satisfaction, and product quality. All departments coordinate under one action plan directed by
the outlet manager.

Example: During a lunch-time rush, the grill, packaging, and billing sections align efforts under
a central team briefing for fast, accurate delivery.
6. Subordination of Individual Interest to General Interest

Employees are encouraged to prioritize organizational goals over personal preferences. Tasks
such as working overtime or handling customer complaints are expected to be accepted in the
interest of the store.

Example: A staff member switches stations from the counter to cleaning duty when a colleague
is absent, without objecting.

7. Remuneration

Subway follows a fair remuneration policy. Crew members are paid fixed hourly wages, and
incentives are given for outstanding performance. Pay structure is transparent and timely.

Example: Employees exceeding weekly service targets receive a small bonus or recognition
voucher, motivating consistency.

8. Centralization and Decentralization

Strategic decisions, like menu innovation or pricing, are centralized at the corporate level.
However, day-to-day decisions, such as staffing, stock reordering, and handling walk-in
feedback, are decentralized to outlet managers.

Example: A store manager independently decides to extend working hours by 30 minutes during
a local festival after noticing increased footfall.

9. Scalar Chain

A clear hierarchy exists from crew members to outlet manager, then to regional supervisor and
corporate office. Communication is routed through the proper chain unless urgent.

Example: A cashier routes a system malfunction complaint to the shift manager, who escalates it
to IT support via the area head.

10. Order

Resources and people are systematically arranged. Inventory is organized in shelves labeled by
category and expiry date. Job roles are assigned according to skill sets, ensuring optimal
placement of human resources.
Example: Frozen patties are placed in FIFO (First-In, First-Out) format in cold storage to avoid
spoilage, and new employees shadow senior workers for skill-based onboarding.

11. Equity

There is fair treatment of all employees, regardless of gender or background. Promotions are
performance-based. Feedback is collected without bias, and all employees have access to
grievance redressal.

Example: Both male and female employees are assigned to billing counters and kitchen stations
equally, with regular rotation to ensure fairness.

12. Stability of Tenure

The outlet maintains low turnover. Employees who stay longer are offered team leader roles or
recommended for higher positions. Training programs aim at retention and role clarity.

Example: A senior employee, after completing one year, is promoted to trainer for onboarding
new recruits.

13. Initiative

Team members are encouraged to suggest improvements in workflow, customer engagement,

and safety. Monthly feedback sessions help gather new ideas.

Example: An employee proposes a new tray-stacking system that saves time during bulk orders,
which is adopted after a trial run.

14. Espirit de Corps

Team spirit is actively encouraged through group targets, shared responsibilities, and informal
gatherings. Staff birthdays and team achievements are celebrated together.

Example: During evening shifts, staff often share light moments during breaks, building trust and
camaraderie. Team members cheer each other during daily performance briefings.
Subway’s operations reflect not only an understanding of Fayol’s classical principles but also an
adaptation of those values to suit a modern, fast-paced service environment. The next section
summarizes key findings from this study.

11. Findings and Analysis

The application of Henri Fayol’s 14 Principles of Management at the Subway outlet studied
reveals several important insights. This section presents the observed effectiveness, strengths,
and areas for improvement within the organization.

🔍 Key Findings:
1. Strong Implementation of Core Principles

Subway has successfully embedded principles such as Division of Work, Unity of Direction,
Order, and Discipline into its daily operations. These principles are not just theoretical—they
guide the store’s workflow, team roles, and customer service delivery.

2. Hierarchy and Communication are Well Structured

The Scalar Chain is evident in how instructions and reports move through formal channels.
Employees clearly understand who they report to, and decisions are rarely delayed due to
confusion in command or role overlap.

3. Motivated Workforce with Sense of Belonging

The principle of Espirit de Corps is visible in team-based tasks and informal bonding among
staff. Managers strive to create a workplace that balances performance with empathy, reinforcing
Equity and Stability of Tenure.

4. Balanced Centralization and Decentralization

Corporate-level controls key aspects like pricing, branding, and policies, while local outlet
managers are empowered to make operational decisions—demonstrating an effective use of
centralization and decentralization.

5. Customer Service Drives General Interest

Employees consistently put customer satisfaction above personal inconvenience, showing a high
level of alignment with the principle of Subordination of Individual Interest to General
Interest.
📊 Analytical Insights:
Fayol Principle Observed at Subway? Level of Effectiveness

Division of Work Yes High

Authority and Responsibility Yes Moderate

Discipline Yes High

Unity of Command Yes High

Unity of Direction Yes High

Subordination of Interest Yes Moderate

Remuneration Yes Moderate

Centralisation Yes Balanced

Scalar Chain Yes High

Order Yes High

Equity Yes Moderate–High

Stability of Tenure Yes High

Initiative Yes (limited) Moderate

Espirit de Corps Yes High

⚖️Strengths:

 Well-defined roles and hierarchy

 High emphasis on teamwork
 Clean and well-organized workspace
 Active feedback mechanism
 Fair promotional practices

🚧 Areas of Potential Improvement:

 Initiative could be encouraged more through internal innovation challenges or

suggestion-based incentives.
 Remuneration is basic and could be enhanced with non-monetary motivators like
certificates, spot rewards, or flexible shifts.
 Though Authority and Responsibility are balanced, occasional delays in decision-
making during high rush hours can be streamlined.
Overall, the principles of management are not only visible but actively shape the daily
experience of both staff and customers at Subway, supporting long-term success and
operational excellence.

12. Challenges Faced During the Study

Despite the structured planning and objective-driven approach, several challenges were
encountered during the project:

🧩 Operational Constraints

 Observations were limited to peak and off-peak hours on weekends, which may not
reflect week-long dynamics.
 Certain managerial activities (like internal financial reviews or HR policies) were
inaccessible for observation due to confidentiality.

🙅‍♂️Data Limitations

 Employees were unable to share salary details, bonus policies, or contract terms due to
company policy, limiting the depth of analysis for the Remuneration principle.

📵 Limited Documentation Access

 Corporate-level documents regarding strategic planning, centralization metrics, and

broader communication hierarchies were not shared with store-level staff.

😶 Reluctance in Interviews

 Some staff members were initially hesitant to respond to questions, fearing repercussions
or misinterpretation. Verbal consent and reassurance were necessary to proceed.

🔍 Observational Bias

 Certain assumptions had to be made based on external behavior due to lack of internal
process transparency (e.g., grievance redressal, managerial decision-making logic).

Despite these challenges, the study was successfully conducted through keen observation, logical
interpretation, and supplementary online research about Subway’s standard operating practices.
13. Conclusion
This project has provided a comprehensive and insightful understanding of Henri Fayol’s 14
Principles of Management, not just as theoretical concepts but as practical guidelines that
govern modern businesses.

Through direct observation of day-to-day operations at Subway, it is evident that these principles
continue to serve as the foundation of structured, scalable, and efficient management
practices. The outlet's operational discipline, clearly defined hierarchy, and focus on team
coordination echo Fayol’s vision of a well-managed enterprise.

Some of the most strongly implemented principles at Subway include:

 Division of Work
 Unity of Direction
 Order
 Discipline
 Scalar Chain
 Espirit de Corps

These have directly contributed to Subway’s reputation for fast service, cleanliness, team
morale, and customer satisfaction.

However, the study also revealed areas for improvement. The Initiative principle, while
encouraged informally, can be reinforced through structured programs. Similarly, non-monetary
aspects of Remuneration could be explored to further enhance motivation and employee
retention.

In conclusion, the project shows that Fayol’s classical management principles are not only
relevant but vital in the present business landscape. By combining traditional wisdom with
modern innovation, businesses like Subway achieve a harmonious balance between
consistency and adaptability, which is the key to sustainable success.

14. Bibliography
1. NCERT Business Studies Class XII Textbook – Part 1
2. CBSE Curriculum Guidelines 2025–26
3. General and Industrial Management by Henri Fayol
4. Official Subway India Website [Link]
5. News Articles from The Economic Times & Business Standard (Subway India
Expansion)
6. Interviews and Observations at Subway Outlet – [Insert Location]
7. YouTube – Behind the Scenes: How Subway Works (Training Video Clips)
 8. Notes from Class Lectures and Teacher Guidance

15. Appendix
 Photo 1: Subway Outlet Exterior
 Photo 2: Service Station (Billing Counter)
 Photo 3: Order Preparation Area (Kitchen)
 Photo 4: Staff Working Uniform and ID
 Diagram: Organizational Hierarchy Chart (Crew Member → Shift Manager → Store
Manager → Area Supervisor)
 Chart: Table Mapping Fayol’s Principles to Real-life Observations
 Handwritten Interview Notes: Summary of Informal Discussions with Shift Supervisor
 Sample Duty Roster (Obtained with Permission)
 Performance Tracker Template (Mock Format)
 Copy of Store Code of Conduct Notice (Visible at Backroom)