CLASS 12 BUSINESS STUDIES
UNIT - 1
NATURE AND SIGNIFICANCE OF MANAGEMENT
Very Short Answer & Questions (Mark-1)
1. Define Management.
Ans. According to Henry Fayol, To manage is to forecast, to plan, to organise, to command, to co-ordinate and to control"
2. Anything minus management is nothing. What does this statement tell?
Ans. Anything minus management is nothing.' This statement states that all the activities - business or non-business, if we deduct management out of theseactivities, the result will be failure or nothing.
3.Is management a goal oriented process?
Ans. Yes, management is a goal oriented process as it always aims at achieving the organisational objectives.
4. Management is an art or science or both.
Ans:- Management is both science as well as art Like science it has systematic and well-organised body of knowledge and like art it requires personal skill Creativity and practice to apply such knowledge in the best possible way
5. Management is multi dimensional. Write one dimension.
Ans. The one dimension of management is management of work
6.Do you think management is a continuous process? Comment.
Ans. Yes, management is a continuous or never ending process as it comprises a series of functions. All the functions of management are performed continuously, for example planning, organising, staffing, directing and controlling
7. Why it is said that management is all pervasive?
Ans. Management is an universal phenomenon The use of management is applicable to all types of organisations whether profit making or non-profit making That is why it is said to be all pervasive.
8.Is management a dynamic function?
Ans:-Yes, management is a dynamic function as it constantly engaged in the moulding of an ever changing business environment.
Management of any organisation strives to attain different objectives.
9.Mentiony two such objectives.
Ans. Any two objectives are:
(1) Organisational objectives (1) Social objectives.
10. Why it is said management principles are Universal?
Ans. Management principles are not restricted to business firms only, it is application in profit making, non-profit making, business or non-business organisations. That is why it is said to be universal.
11. Name the level of management the following posts belong to: (i) Purchase
Manager (ii) Superintendent.
Ans. (i) Purchase Manager-Middle Level Management.
(ii) Superintendent- Lower level Management.
12. At which level business policy is formed?
Ans. Top Level Management.
13. Do you think co-ordination is not the function of management.
Ans. Co-ordination is not only a function of management but it is an essence of management as it brings unity of action and integrates different activities of organisation.
14. What do you mean by 'efficiency'?
Ans. It refers to efficient utilisation of resources to accomplish goals and objectives.
15.Which function of management ensures that actual activities conform to planned activities?
Ans. Controlling.
Short Answer Questions: Type I (Marks-3)
1. Management is a goal oriented process. Explain. Ans. Management always aims at achieving the organisational objectives without having a goal or an aim I cannot run a business. The functions and activities of manager lead to the achievement of organisational objectives, for example, if the objective of a company is to sell 1000 computers then the manager will plan the course of action, motivate all the employees and organise all the resources keeping in mind the main target of selling 1000 computers.
2.Discuss three basic feature of management as a profession.
Ans. The three basic feature of management as a profession are as follows:
(i) Well defined body of knowledge: In every profession there is practice of systematic body of knowledge which helps the professionals to gain specialised knowledge of that profession.
(ii) Restricted entry: The entry to a profession is restricted through an examination or degree. For eg, a person can practice as doctor only when he is having a MBBS degree.
(iii) Presence of professional associations : For all the professions, special associations are established and every professional has to get himself registered with his association before practicing that profession. For eg., doctor have to get themselves registered with Medical Council of India to start their practice.
3.Distinguish between Co-ordination and Co-operation.
Ans:-
4. Ramen is the manager of the North-East Division of a large corporate house dealing with electrical goods. At what level he works in the organisation? What is his basic functions?
Ans. Ramen is working at the Middle Level. His basic functions are as follows
(i) Interpreting the policies formed by the top level management and acting as a link between the top level management and operative management
(ii) Assigning necessary duties to the employees.
5. State three functions of top level management.
Ans. The three functions of top level management are
(i) Determining the objectives of the enterprise : The top level managers formulate the main objectives of the organisation. They form long term as well as short term objectives.
(ii) Framing of plans and policies: The top level managers form the plans and policies to achieve the set objectives:
(iii) Responsible for welfare and survival of the organisation: The top level managers are responsible for welfare and survival of the organisation. They make plans to run the organisation smoothly and successfully
4.State any three functions of lower level management.
Ans. The three functions of lower level management are__
(i) Looking for safety of workers: Lower level managers provide safe and secure work environment for workers.
(ii) Communicating with workers and welcoming their suggestions: The lower level managers encourage the workers to take initiative. They welcome their suggestions and reward them for good suggestions.
(iii) They try to maintain precise standard of quality and ensure steady flow of output The lower level managers make sure that quality standards are maintained by the workers.
7.Why is management regarded as science? Give three reasons.
Ans. The three reasons why management is regarded as a science are as follows:
(i) Systematic body of knowledge: In science organised and systematic study material is available which is used to acquire the knowledge of science Like science in management also there is availability of systematic and organised study material. So first feature of science is present in management.
(ii) Principles are based on repeated experiments: Before developing scientific principles scientists test these principles under different conditions. Similarly. managers also test & experiment managerial principles under different conditions in different organisations. That is why management is regarded as science.
(ii) Cause and Effect Relationship : Principles of science lay down cause and effect relationship between various variables. The same is true for management, therefore it also establishes cause and effect relationship.
8. What is management by Objectives? Explain.
Ans. Management by Objectives (MBO) refers to the system in which the objectives of an organization are agreed upon so that management and employees understand a common way to forward. The term "management by objectives" was first popularized by Peter Drucker. Management by objectives is also known as management by results (MBR). The essence of MBO is participative goal setting, choosing course of actions and decision making.
9.Why is management considered as inexact science? Give three reasons.
Ans. Science can be defined as a systematic and organised body of knowledge based on logical observed findings, facts and events. The three reasons why management is considered as mexact science are as follows:
(i) Science is a systematised body of knowledge. Its principles are based on cause and effect relationship eg, water evaporates on being heated Same way. management is a body stigmatised knowledge. All managerial principles have cause and effect relationship.
(ii) Scientific principles are first developed through observation and then tested through repeated experimentation. Same way management principles are also propounded after observation and repeated experimentation
(iii) All scientific principles have universal validity. They give similar results whenever applied Whereas principles of management do not have universal validity. They have to be adjusted and applied according to the need of the situation.
Thus, management is considered as an inexact science.
10. Explain in brief management as a process.
Ans. As a process, management refers to a series of inter-related functions. It is the process by which management creates, operates and directs purposive organisation through systematic coordinated and co-operated human efforts Management is a distinct process consisting of planning, organising, staffing, directing and controlling. As a process, management consists of
(i) Management is a social process: Since human factors is most important among other factors, therefore management is concerned with developing relationship among people.
(ii) Management is an integrating process: Management undertakes the job of bringing together human, physical and financial resources so as to achieve organizational purpose.
(iii) Management is a continuous process: It is a never ending process. It is concerned with constantly identifying the problem and solving them by taking adequate steps
Short Answer Questions: Type-II (Marks-4)
1. Explain briefly nature of management.
Ans. According to the Modem concept 'management is a process of getting things done with the aim of achieving goals effectively and efficiently." Management reveals the following nature or characteristics
(i) Management is Pervasive : Management is a universal phenomenon. The use of management is not restricted to business firms only; it is applicable in profit making, non-profit making, business or non-business organisations.
(ii) Management is a continuous process: Management is a continuous or never ending process. All the functions of management are performed continuously, for eg planning, organising, staffing, directing and controlling are performed by the managers continuously.
(iii) Management is a group activity: Management always refers to a group of people involved in managerial activities. The goals and objectives of an organisation can be effectively attained by a group rather than by an individual.
(iv) Management is intangible : Management function is intangible in its nature. It cannot be physically seen but its presence can be felt.
2. Explain in brief four importance of management.
Ans. In the absence of management, no organisation can run smoothly. The major importance of management are
(i) Management helps in achieving group goals: Management tries to integrates the objectives of individuals along with organisational goal. It directs the efforts of all individuals in the common direction towards achieving an organisational objective
(ii) Management helps in increasing productivity: The main objective of an organisation is to maximise profit by reducing the cost. The management must supervise the people working in the organisation and motivate them to work so that the productivity increases
(iii) Management improves efficiency : Managers try to reduce the cost and improve productivity with minimum wastage of resources Management insists on being efficient and effective in the work through planning, organising, staffing, directing and controlling.
(iv) Management brings harmony in work: In an organisation employees from different backgrounds come, they have different styles and attitudes of working and if everyone starts following his own style, it can lead to chaose and confusion in the organisation. The management can bring uniformity by giving directions to the employees.
3.Distinguish between co-ordination and co-operation.
Ans:-
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Long Answer Questions: Type-1 (Marks-5)
1.Explain in details the levels of management.
Ans. The term 'levels of management' refers to a line of demarcation, between various managenial positions in an organisation. This line is divided into three levels which are as follows
1.Top level management
2.Middle level management
3.Supervisory level or lower level of management
The above mentioned levels are discussed below__
1.Top level management: The top level of management consists of ma at the highest level in the management hierarchy Top level management con of chairman Board of Directors, General Manager, President, Vice-President etc. The activities at this level centres round establishing overall goals, pla strategies and guidelines of the organisation Some of the important functions of top level management are
(i) Framing plans and policies: The top level managers also frame the plans and policies to achieve the set objectives.
(ii) Determining the objectives of the enterprise: The top level managers formulate the main objectives of the organisation
(iii) Responsible for welfare and survival of the organisation : Top level is responsible for the survival and growth of the organisation.
2. Middle Level Management : Middle level management is regarded as the most important management level because it is at the centre of the organisational structure. This level of management consists of departmental heads such as purchase department head, finance manager, marketing manager etc. The main functions performed by this level of managers consists of linking the top and lower levels of management. Functions of middle level management are__
(i) Motivating the persons to perform their best ability: The middle level
managers offer various incentives to employees so that they get motivated and perform to their best ability.
(ii) Implementing the plans framed by top level: Middle level makes sense that plans which are made by top level are implemented
(iii) Cooperate with other departments for smooth functioning.
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3. Supervisory Level / Lower Level Management: The lower level of management consists of first line managers. This level consists of supervisors. foreman, clerk, superintendent ete First line managers are directly in touch with the operative employees or the rank and file. There are no managers below this level. The main functions of lower level management are
(i) Looking to safety of workers: Supervisory level managers provide safe and secure work environment for workers.
(ii) They are responsible for boosting the morale of the workers and developing the team spirit in them.
(iii) Minimising the wastage of materials.
2. Management is a series of continuous inter related function. Explain fully.
Ans. Management is a set of continuous or never ending function. All the functions of management are inter related. For example, planning, organising, staffing, directing and controlling are performed by the managers at a time. Each of the functions of management are inter related. In management process managers create, direct, maintain and operate purposive organisation through systematic, co-ordinated and co-operative human efforts. The various managerial activities cannot be performed once for all, but is a continuous process. A manager is busy sometimes in doing one managerial activity and at other times some other activity.
4. Your father has retired as the purchase manager of a company. At what level of management was he working? What functions do you think be was performing at that level of management?
Ans. My father was working in the middle level of management. His basic functions were as follows -
(i) Linking the top and supervisory level of management.
(ii) Taking departmental decisions
(iii) Inspiring lower level managers towards better performance.
(iv) Transmitting orders, suggestions and decisions downwards.
(v) Issuing detailed instructions to lower level of management
4. Do you think management has the characteristics of a full-fledged profession?
Ans. Management has the characteristics of a full-fledged profession if it satisfies the conditions below
(i)Well defined body of knowledge: All professions are based on a well defined body of knowledge that can be acquired by teaching-learning process. This feature of a profession is possessed by management as well. There is vast knowledge available on management in the form of definations, concepts etc..
(ii) Restricted entry: All professions have a restrictions on the entry of its practitioners They have to acquire a specific degree to be a professional. Eg. LLB degree for a lawyer, MBBS degree for a doctor etc. But a manager can be a MBA qualified or not
(iii)Professional Association : All professions are affiliated to a professional association which regulates entry, grants certificate of practice etc eg. All lawyers have to be a member of Bar council to practice law It is not compulsory for all managers to be a member of AIMA.
(iv)Ethical Code of Conduct : All professions are bound by an ethical code of conduct which guides the behaviour of its members. However, it is not compulsory for all the managers to be members of AIMA.
(v) Service Motive: The basic motive of all professionals is to serve their clients interest. Eg., lawyers to get justice for their clients, doctors to treat their patients etc. All managers also work in a manner whereby they show their effectiveness and efficiency in the form of good quality, provided to the customer at a reasonable price,
5."A successful enterprise has to achieve its goals effectively and efficiently". Elucidate the statement.
Ans. Management has been defined as a process of getting things done with the aim of achieving goals effectively and efficiently. Being effective or doing work effectively means finishing the given task Effectiveness in management is concerned with doing the right task, completing activities and achieving goals. But it is not enough to just complete the tasks. Completing task efficiently is also important. Efficiency means doing the task correctly and with minimum cost. If by using less resources more benefits are derived then efficiency has increased. For management, it is important to be both effective and efficient. Effectiveness and efficiency are two sides of the same coin. Usually high efficiency is associated with high effectiveness which is the aim of all managers.
6 "Management is considered an Art or Science or both". Elucidate the statement.
Ans:-Management as a Science : Science is a systematized body of knowledge pertaining to a specific field of study and contains general facts that explain a phenomenon. The principles are absolute facts having universal application. As such science is characterized by the following features:
(i) Existence of systematised body of knowledge.
(ii) Principle based on experiments.
(iii) Universal validity of principles.
On examination we find that management has some of these features and it does not have others. For instance, management is a systematised body of knowledge. - The management principles are flexible and can be used in different situations with modification. So, these principles have universal applicability Thus, management can be called as an inexact science.
Management as an Art: Art is concerned with the application of knowledge and skills. Desired results are achieved through the application of skills. Thus, an art has the following characteristics__
(i) It signifies practical knowledge.
(ii) It is creative in nature
(iii) It signifies personal skills in particular field of human activity. Management is known as an art since it involves application of knowledge and personal skills to achieve desired results. As an act management calls for a combination of abilities, skills and judgement
Management: Both science and an art: Management is a combination of an organized body of knowledge and skillful application of this knowledge. Effective performance of various management functions necessarily needs an adequate basis of knowledge and a scientific approach. Thus, management is both a science and an art.
Long Answer Questions: Type-II (Marks-6)
1. 'Co-ordination is the essence of management'. Do you agree? Give reasons.
Ans. Co-ordination is regarded as the essence of management because each of the managerial function contributes to co-ordination. Co-ordination as an essence of management is discussed below
(i) In planning co-ordination is required between the main plan and supportive plans of different departments.
(ii) In organising co-ordination is required between different resources of organization and also between authority, responsibility and accountability.
(iii) In staffing co-ordination is required between skill of a person and job assigned to him, between efficiency and compensation etc an
(iv) In directing function, co-ordination is required between superior and sub-ordinates, between order, guidelines etc
(v) In controlling function, co-ordination is required between standards and actual performance It is clear from the above discussion that co-ordination is regarded as an essence of management rather than separate function of management.
2.What are the functions of management? Explain in detail.
Ans. Following are the functions of management
(i)Planning Planning is the first and foremost function of management. It is deciding in advance what to do, how to do, when to do and who is to do. Planning makes it possible for things to occur which would otherwise not happen It is needed for all functions and at all levels of management
(ii)Organising: Organising refers to the process of bringing together physical. financial and human resources and establishing productive relations among them for the achievement of pre-determined goals. The main aim of organising is to enable the people to relate to each other to work together for a common purpose.
(iii) Staffing: The staffing may be defined as the managerial function of hiring and developing the required personnel to fill in various positions in the organization. It is also concerned with employing the right people and developing their skills through training.
(iv) Directing. It is the function of managements concerned with instructing, guiding supervising, motivating and leading the subordinates to contribute to the best of their abilities for the achievement of organisational objectives.
(v) Controlling: Controlling is the process of verifying actual performance is in conformity with planned performance and taking corrective action where necessary It enables managers to detect deviations in performance if any and rectify them to prevent their repetition in future.
3. What are the characteristics of management? Explain in details.
Ans. The characteristics of management are
(i) Management is a goal oriented process Management always aims at achieving the organisational goals or objectives. The functions and objectives of a manager lead to the achievement of organisational objectives.
(ii) Management is Pervasive : Management is a universal phenomenon. The use of management is not restricted to business firms only, it is applicable in profit. making, non-profit making, business or non-business organisation.
(iii) Management is a group activity: Management always refers to a group of people, involved in managerial activities. The management function cannot be performed in isolation. Each individual performs his/her role at his/her status and department, then only management function can be isolated (iv) Management is a dynamic function: Management has to make changes in goal, objectives and other activities according to the changes taking place in the environment. The external environment such as social, economical, technical and political environment has a great influence over the management.
(v) Management is intangible: Management function cannot be physically seen but its presence can be felt. The presence of management can be felt by seeing the orderliness and co-ordination in the working environment.
(vi) Composite Process: Management consists of a series of functions which must be performed in a proper sequence. As the main function of management is planning, organising, staffing, directing and controlling, organising cannot be done without planning, directing function cannot be executed without staffing. All the functions are inter-dependent and that is why it is said to be a composite process
4.What are the objectives of management? Explain in details.
Ans. Management objectives can be classified into three major categories
(i) Organisational objectives
(ii) Social objectives
(iii) Personal Individual objectives
A brief description about each objective is given below:
(i) Organisational objectives: Management should be basically concerned with utilizing human and material resources available to an enterprise for deriving best results. This leads to reduction in cost and maximum prosperity for the organization by generating high profits.
The main organizational objectives are:
(a) Survival: The basic objectives of any business is survival. In order to survive, an organisation must earn enough revenues to cover costs.
(b) Profit: Management has to ensure that the organisation makes a profit. Profit provides a vital incentive for the successful continuation of operations in an enterprise.
(c) Growth: A business needs to add to its prospects in the long run, for this it is important for the business to grow. An organization can grow and expand only af it moves in the pre-determined direction
(ii) Social objectives: Social objectives deal with the commitment of an organization towards society Such objectives may be pertaining to health, safety, labour practices etc. It should be noted that most business houses in achieving their primary goals also contribute to their respective communities by creating needed economic wealth, employment and financial support to the community.
(iii) Personal/Individual objectives : Individual objectives are pertinent to the employees of the organization. Each employee joins an organization to satisfy his needs by working in the firm These objectives may include competitive salary. personal growth and development, peer recognition etc
5 Discuss the significance of management to a modern industrial enterprise?
Ans. The significance of management to a modern industrial enterprise has increased tremendously due to the following challenges:
(i) Growing size and complexity of business (ii) Increasing specialization of work
(iii) Growing unionization of labour
(iv) Increasing complexity of business decisions.
(v) Need for optimum utilization of scarce resources. In a developing country like India, the significance of management can hardly be over emphasized. Higher efficiency and higher productivity is the only hope of the people.
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Read Also : Class 12 Business Studies All Chapterwise Notes & Important Questions Answers.
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