Detailed, Step-by-Step NCERT Solutions for 12 Business Studies Chapter 2 Principles of Management Questions and Answers were solved by Expert Teachers as per NCERT (CBSE) Book guidelines covering each topic in chapter to ensure complete preparation.
Principles of Management NCERT Solutions for Class 12 Business Studies Chapter 2
Principles of Management Questions and Answers Class 12 Business Studies Chapter 2
Multiple Choice Questions
Principles of Management are NOT
How are principles of Management formed ?
(a) In a loboratory
(b) By experiences of Managers
(c) By experiences of customers
(d) By propagation of social scientists.
(b) By experiences of Managers.
The principles of management are significant because of’
(a) Increase in efficiency
(c) Optimum utilisation of resources
(d) Adaptation to changing technology
(a) Increase in efficiency.
Henri Fayol was a
(a) Social scientist
(b) Mining Engineer
(d) Production Engineer
(b) Mining Engineer.
Which of the following statement best describes the principle of ‘Division of Work’
(a) Work should be divided into small tasks
(b) Labour should be divided
(c) Resources should be divided among jobs
(d) It leads to specialisation
(a) Work should be divided into small tasks.
‘She/he keeps machines, materials, tools etc. ready for operations by concerned workers.’ Whose work is described by this sentence under functional foremanship
(a) Instruction card clerk
(b) Repair Boss
(c) Gang Boss
(d) Route clerk
(c) Gang Boss.
Which of the following is NOT a Principle of management given by Taylor?
(a) Science, not rule of the Thumb
(b) Functional foremanship
(c) Maximum not restricted output
(d) Harmony not discord
(b) Functional Foremanship.
Management should find ‘one best way’ to perform a task. Which technique of Scientific management is defined in this sentence
(a) Time Study
(b) Motion Study
(c) Fatigue Study
(d) Method Study
(d) Method study.
Which of the following statements best describes ‘Mental Revolution’?
(a) It implies change of attitude.
(b) The Management and workers should not play the game of one upmanship
(c) Both management and workers require each other.
(d) Workers should be paid more wages.
(a) It implies change of attitude.
Which of the following statement is FALSE about Taylor and Fayol
(a) Fayol was a mining engineer whereas Taylor was a mechanical engineer
(b) Fayol’s principles are applicable in specialised situations whereas Taylor’s principles have universal application
(c) Fayol’s principles were formed through personal experience whereas Taylor’s principles were formed through experimentation
(d) Fayol’s principles are applicable at the top level of management whereas Taylor’s principles are applicable at the shop floor.
(b) Fayol’s principles are applicable in specialised situations whereas Taylor’s principles have universal application.
Short Answer Type Questions
How is the principle of ‘Unity of command’ useful to management? Explain briefly.
Unity of Command:-
According to this principle, every employee should get orders and directions only from one superior and he should be accountable to that superior alone. It is essential to avoid duality of command. If a subordinate gets orders from two superiors, in such a situation he would not be able to decide which superior’s orders should be carried out first.
The superiod whose orders are not carried out might become annoyed or develop a feeling of jealousy and bitterness towards the other superior. According to Fayol.” as soon as two superiors yield their authority over the same person or department, uneasiness makes itself felt.”
Fayol further writes that if there are two or more superiors as regards any employee, it will only undermine authority, put discipline in jeopordy, disturb order and threaten stability of organisation.
Define scientific management. State any three of its principles.
The Scientific Management school stimulated by F.W. Taylor and carried on by others through the years, suggested a totally revolutionary way of thinking about the problems of work and organizations. The Major theme of scientific Management was that work could be studied scientifically.
Taylor retentlessly pursued the idea that efficiency at work could be improved through careful ‘scientific’ analysis. He advocated an inductive, empirical, detailed study of each job to determine the ‘one best way’ to organize work. The primary emphasis was on the application of scientific methods to the solutions of managerial and organizational problems. Tosi and Corroll summarized the principles of scientific management thus
(i) Current Management practice was inefficient. Most scientific management writers believed that the way Management was practiced in their time was inefficient.
(ii) Management must adopt the scientific methods in industry. The scientific methods involves solving problems by research rather than relying or experience or intuition. It demands evalution of alternatives by making systematic and objective comparisons among them to see which is best. Taylor and his colleagues believed there is ‘one best way’ to organize work and this could be ascertained through scientific method.
(iii) Specialization should be practiced. Taylor advocated the division of the entire work of an organization into managerial and non-managerial categories. He favoured a complete separation of planning function from doing function. He proposed using specialization experts, called as functional foremen, each of whom was to be responsible for some specific portion of the worker’s job like inspection of work, ascertaining the machine speed etc. He firmly believed that vertical specialization would improve job performance.
(iv) Planning and scheduling were essential. In scientific management everything was to be done according to a plan. To improve performance, plans for a whole organization were to be broken down into plans for smaller units, and even further to individuals. Writers like Gantt developed charts (Gantt chart) which helped a Manager to make optimum use of his resources by carefully schedulingjobs among available equipment and resources.
If an organisation does not provide the right place for physical and human resources in an organisation, which principle is violated? What are the consequences of it?
When the organisation does not provide the right place for physical and human resources it violate the principles of division of work propounded by Henri Fayol. The Principle of division of work may be explained in brief as follows.
Division of work
This principle tells us that as far as possible the whole work should be divided into parts and each employee should be assigned only one part of the work according to his ability and attitude.
When that employee performs that part of the work repeatedly, he will become specialised in doing that particular part of the work, consequently, the benefits of the specialisations will be achieved. According to Fayol, the principles of division of work is applicable to all kinds of work – technical as well as Managerial.
Explain any four points regarding significance of Principles of management?
Need and Importance of principles of Management : A principal is a fundamental statement of truth that provides a guide to thought and action. The technique and nature of Management may be based on the defined principles. By abiding the principles of Management a manager may escape from committing errors. The need and importance of Management principles may be highlighted in the following ways
(i) To Increase the Managerial Efficiency :
The principles of Management have been developed on the basis of experiences of professional Managers. These principles instruct a Manager as to how to act in various situations so that the mistakes committed by the previous Manager are not repeated. Application of Management principles avoid the need for trial and error-method. They ‘ can make decisions on the basis of predetermind principles and thereby increase the Managerial efficiency.
(ii) Helpful in Managerial Training :
The principles of Management present a detailed schedule of training for the new managers. By acquiring the knowledge as to which principle is to be used in a particular situation they can learn the art of Management quickly.
(iii) To Improve Research :
The principles of Management provide new ideas, new thoughts and new vision to managers and researchers. Since the principles are flexible in nature they motivate the managers to do further research in the field of Management and thus they are helpful in increasing the horizons of knowledge.
(iv) Helpful in understanding the Nature of Management :
The principles of management explain the nature and functions of Management. Thus, they are helpful in understanding the nature and functions of Management.
(v) To Allain Social Goals
The standard of living of the people in a society depends on the quality of Management. Only the development of Managerial principles enables more efficient utilisation of human and material resources. Thus, Management principles are helpful in the attainment of social and cultural goal such as better quality products at resonable rates, more employment opportunities, increase in wages etc.
Explain the principle of ‘Scalar Chain’ and gang plank.
Scalar chain According to the principle, there is a scalar chain of authority in the organisation which moves in a straight line from the highest authority to the lowest level subordinates. According.to Fayol each communication from top to lower level and vice versa should flow through each executive along the scalar chain. Fayol has explained this scalar chain with the help of the following diagram :
Above diagram depicts that A is the seniormost executive and BCDEFG and LMNOPQ are his subordinates. Normally, each communication from top to lower level will flow from A to B, B to C, C to D and will trickle down from F to G. Similarly, every communication from lower level to top will flow G to F, F to E, E to D and will finally reach A from B. If suppose F wants to communicative with P then according to scalar chain such a message will first reach A through E,D,C,B and then it will reach P through L,M,N,0.
According to Fayol the process of scalar chain results in unnecessary delay and if it is essential to communiate immediately, a gangplank may be created between F and P without breaking the scalar chain. This gangplank allows the two employees to communicate directly with each other, but for this it is necessary for F to take prior permission from his immediate superior E and similarly P has to take prior permission from his imediate superior Q, and each must provide the details of their conversations to these superiors.
Long Answer Type Questions
Explain the principles of scientific Management given by Taylor?
Taylor’s Scientific Management :
It refers to an important stream of one of the earlier schools of thought of management referred to as the classical school. Taylor thought that by scientifically analysing work.it would be possible to find ‘one best way’ to do it. He believed that contemporary management was amateurish and should be studied as a discipline.
He is known for coinage of the term scientific management’ In the words of Taylor, scientific management means “knowing exactly what you want men to do and seeing that they do it in the best and cheapest way” thus the principles are
1. Science not Rule of Thumb
Taylor pioneered the introduction of the method of scientific inquiry into a domain of management practice. He believed that there was only one best method to maximise efficiency.
This method can be developed through study and analysis. According to Taylor even a small production activity like loading pigs of iron into boxcars can be scientifically planned and managed. It will save time and energy both.
2. Harmony, Not Discord
Factory system of production implied that managers served as a link between the owners and the workers. Taylor recognised that this conflict helped none the workers, the managers or factory owners. He emphasised that there should be complete harmony between the management and workers.
To achieve this state Taylor called for complete mental revolution on the past of both. According to Taylor, “Scientific management has for its foundation the firm conviction that the true interests of the two are one and the same.”
3. Co-operation, Not Individualism
There should be complete cooperation between the labour and the management instead of individualism. This principle is an extension of principle of “Harmony not discord”. According to Taylor, ‘there should be an almost equal division of work and responsibility between workers and management.
4. Development of Each and Every person to his or her greatest efficiency and prosperity Industrial efficiency depends to large extent on personnel competencies. As such scientific management also stood for workers development workers training was essential also to learn the “best method” developed the scientific approach. Thus each person should be scientifically selected, they should be given required training. Thus we can say that Taylor was an ardent supporter of use of scientific method in business.
Explain the following Principles of management given by Fayol with examples
(a) Unity of direction
(c) Espirit de corps
(e) Centralisation and decentralisation
(a) Unity of Direction
According to this principles, each group of activities having the same objective must have one head and one plan. Observance of this principles provides great help to the management in maintaining co-ordination among various functions of an organisations. Unity of direction is essential for achiveving unity of action. To ensure success in any group effort, it is necessary that authority for directing the group action is concentrated in just one person and above all, the entire group has the same plan to act upon, otherwise there would be duplication of activities and uncessary wastage of resources.
Equity implies that employees should be treated with justice and kindness. Managers should be fair and impartial in their dealings with subordinates. They should adopt a sympathetic and unbaised attitude towards employees. Equity helps to create cordial relations between management and employees and the employees become loyal to the organisation whereas partiality breeds frustrations which adversely affects their efficiency.
(c) Espirit De corps or Team spirit
It is a French word which means that there should be team spirit in the organisation. In other words, all the persons working in the organisation should have harmony and mutual understanding. Union is strength, unity in the staff is the foundation of success in any organisation. Management should not follow the policy of’divide and rule’ rather it should strive to maintain team-spirit and co-operation among employees so that they can work together as a team. According to Fayol only those organisations succeed where all the persons work unitedly as a group.
According to Fayol these are two aspects to an order namely material order and social order. Material order means, there should be a proper place for everything and everything should be in its proper place. Social order means, there should be proper place for everyone and everyone should be in his or her proper place. By following these two orders every person would know the exact place of his work and would know the place from where he would get the things needed by him.
(e) Centralisation and decentralisation
Everything which increases the importance of subordinates role is decentralisation and everything that reduce the importance of subordinates role is centralisation. According to him there should be optimum degree of centralisation and decentralisation must be determined separately for each organisation according to its circumstances.
Small firms for example, are likely to have absolute centralisation, because in this case the managers order are directly transmitted to subordinates. However, in the case of a large firm, there is lesser degree of centralisation because the manager’s order have to pass through a number of intermediaries to reach the subordinates. Management must, therefore, strike out a balance between centralisation and decentralisation.
According to Fayol, each employee has natural capability of thinking out a plan, decision making and implementation of that plan, this is called initiative. Managers should utilise the initiative of their subordinate to the maximum extent. Employees at all levels should be given the opportunity to take initiative and exercise judgement in the formulation and execution of plAnswer:It develops the attitude of employees towards the plans.
Explain the technique of ‘Functional Foremanship’ and the concept of ‘Mental Revolution’ as enunciated by Taylor.
This form of organisational structure was originated by F.W. Taylor, to bring about specialization in management. According to Taylor, “The functional organistion consists of so dividing the management that each man, down from the assistant suprentendent, shall have as few functions as possible to perform. If practicable, the work of each man in the management should be confined to the performance of single leading function”.
Taylor believes that a foreman is not a specialist in all the fields. He can be made only to execute the work. Thus functional organistion is based on the concept of F.W. Taylor’s “Functional Foremanship” under which instead of foreman, the whole work in the factory is controlled and guided by eights-specialists : four concerned with planning of work at the office level and four with its execution at the factory level.
Taylor described, “The really great problem” involved the change “consists of the complete revolution in the mental attitude and habits of all those engaged in the management, as well of workmen.
Mental revolution involves a change in the attitude of the workers and management towards one another from completion to cooperation. Both should realise that they require one another. Both should aim to increase the size of surplus. This would eliminate the need for any agitation.
Management should share the part of surplus-with workers. Workers should also contribute their might, so that company makes profits. This attitude will be good for both of them and also for the company. In the long run only worker well-being will ensure prosperioty of the business.
Discuss the following techniques of Scientific Work Study
(a) Time Study
(b) Motion Study
(c) Fatigue Study
(d) Method Study
(e) Simplification and standardisation of work
(a) Time Study
It determines the standard time taken to perform a well-defined job. Time measuring devices are used for each element of task. The standard time is fixed for the whole of the task by taking several readings. The methods of time study will depend upon volume and frequency of the task, the cycle time of the operation and time measurements costs.
The objectives of time study is to determine the number of workers to be employed, frame suitable incentives schemes and determine labour costs. For example on the basis of several observation it is determined that standard time taken by the worker to make one cardboard box is 20 minutes. So in one hour she/he will make 3 boxes.
Assuming that a worker has to put in 8 hours of work in a shift and deducting one hour rest and lunch it is determined that in 7 hours a worker makes 21 boxes @ 3 boxes per hour. Now this is the standard task a worker has to do. Wages can be decided accordingly.
(b) Motion study
Motion study refers to the study of movements like lifting, putting objects, sitting and changing positions etc. which are undertaken while doing typical job. Unnecessary movements are sought tp be eliminated so that it takes less time to complete the job efficiently For example Taylor and his associate Frank Gail Berth were able to reduce motions in brick layering from 18 to just 5.Taylor demonstrated that productivity increased to about 4 times by this process.
On close examination of body motions for example it is possible to find out
- Motions which are productive
- Motions which are incidental (e.g. going to stores)
- Which is unproductive.
(c) Fatigue study
A person is bound to feel tired physically and mentally if she/he does not rest while working. The rest intervals will help he to regain stamina and work again with the same capacity. This will result in increased productivity. Fatique study seeks to determine the Amount and frequency of rest intervals in completing a task.
For examples, normally in a plant, work takes place in three shifting of 8 hours each. Even in single shift a worker has to be given some rest interval to take her/his lunch etq. If the work 8 involves heavy manual labour then small pauses have to be frequently given to the worker so that she/he can recharge energy her/his energy level for optimum contribution.
(d) Method study
The objective of method study is to find put one best way of doing the job. There are various methods of doing the job. To determine the best way there are several parameters. Right from procurement of raw materials till when the final product is delivered to the customer is part of method study. Taylor devised the concept of assembly line by using method study. Ford Motor company used this concept very 5* successfully, Even now auto companies are using it.
The objective of the whole exercise is to minimise cost of production and maximise the quality and satisfaction of the customer. For this purpqse many techniques like process chart and operations research etc. are used.
(e) Simplification and Standardisation of work Taylor was an ardent supporter of standardisation. According to . him, scientific method should be used to analyse methods of production prevalent under rule of thumb. The best practice can be kept and further refined to develop a standard, which should be followed throughout the organisation. This can be done through work-study techniques, which include time study, Motion study, Fatigue study and Method study.
Standardisation refers to process of setting standard for every business activity, it can be standardisation of process, raw material, time product, machinery, methods and working conditions. These standards are the benchmarks, which must be adhered to during production. The objectives of standardisation are
- To reduce a given line or product to fixed types, sizes and characteristics.
- To establish interchange ability of manufactured parts and products.
- To establish standards of excellence and quality in materials.
- To establish standards of performance of men and machines.
It is important to have a re-look at the-techniques of scientific
management as comprising a unified while of Taylorian prescription of efficiency. Search for efficiency requires the search for one best method, the chosen method must lead to the determination of the fair day’s work, therefore, the sum and substance of Taylorism lies not in the disjointed description of principles and techniques of scientific . Management.
Discuss the differences between the contributions of Taylor and Fayol.
Fayol versus Taylor – A comparison
Both of them have contributed immensely to the knowledge of Management, which has formed a basis for further practice by managers.
|Basis of Diff.||Henri Fayol||F.W. Taylor|
|Perspective||Top level of Management||Shop floor level of a factory|
|Unity of command||Staunch Proponent||Did not feel that it is important as under functional foremanship a worker received orders from 8 specialists|
|Applicability||Applicable universally||Applicable to specialised situations|
|Basis of formation||Personal experience||Observations and experimentations|
|Focus||Improving overall||Increasing productivity|
|Expression||Practitioner General theory of Administration||Scientific Management.|
Discuss the relevance of Taylor and Fayol’s contribution in the contemporary business environment
Contribution of Taylor and Fayol :
Taylor thought that by scientifically analysis work it would be possible to find “One best way” to do it. He is most remembered for his time and motion studies. He would break ajob into its component parts and measure each to the second.
Taylor believed that contemporary management was amateurish and should be studied, as a discipline. He also wanted that workers should cooperate with management and thus there would be no need of trade unions. The best results would come from the partnership between a trained and qualified management and a cooperative and innovating work force. Each side needed the other.
On the other hand in the development of classical school, of management thought Fayol’s administrative theory provides an important link. While Taylor succeeded in revolutioniring the working of factory shop floor in terms of devising the best method, face day’s work.
Fayol explaired what amount to a manager work and what principles should be followed in doing this work. Fayol’s theories concerning scientific organisation of labour were widely influential in the beginning of twentieth century.
His theories deal with organisation of production in the context of a competitive enterprice that has to controlists”production costs. Fayol was the first to identify four functions of management, Planning, Organising, Directing and Controlling. For his contribution he is also known as the “Father of General Management”. He has given the 14 principles of management.
These are as follows
1. Division of work
2. Authority and Responsibility
4. Unity of Command
5. Unity of Direction
6. Subordination of Individual interest to general interest
7. Remuneration of employees
8. Centralisation and Decentralisation
9. Scalar chain
12. Slubility of personnel
From business magazines annual reports, newspapers or internet find out what changes ar£ taking place in companies relating to corporate governance, production practices etc. Prepare a scrapbook. Discuss these cases with your teacher and friends. Prepare a report of the same.
Guidelines to Project work
Topic : Annual Reports of companies
Introduction : To find out the records of the companies with the help of different magazines and newspapers.
|Name of the Company||Date of launching||Analy*sis||survey||data|
‘F’ limited was engaged in the business of food processing and selling its products under a popular brand. Lately the business was expanding due to good quality and reasonable prices. Also with more people working in the market for processed food was increasing. New players were also coming to cash in on the new trend. In order to keep its market share in the short run the company directed its existing workforce to work overtime.
But this resulted in many problems. Due to increased pressure of work the efficiency of the workers declined. Sometimes the ‘ subordinates had to work for more than one superior resulting in declining efficiency. The divisions that were previously working on one product were also made to work on two or more products. This- resulted in a lot of overlapping and Wastage.
The workers were becoming undisciplined. The spirit of teamwork, which had characterised the company, previously was beginning to wane. Workers were feeling cheated and initiative was declining. The quality of the products was beginning to decline and market share i was on the verge of decrease. ‘ Actually the company had implemented changes without creating the required infrastructure.
Identify the Principles of Management (out of 14 given by Henry Fayol) that were being violated by the company.
The principles of Management that were being violated by the company are as, follows.
- Division of work
- Unity of Command
- Espirit De Corps
Explain these principles in brief.
(a) Division of work
This is the principle of specialisation which applies to all kinds of work. The more people specialise the more efficiently they can perform their work. Specialisation increases output by making employees more efficient.
(b) Unity of Command
Every employee should receive orders and instructions from only one superior. Dual command is a perpeetual source of conflict. Dual command, as propagate by Taylor in his principle of functional foremanship, undermines authority and puts discipline in jeopordy. If a person receives orders from more than one superior, it would lead to confusion from more than one superior, it would lead to confusion and chaos.
The essence of discipline is obedience to agreements reached between parties in the organisation. Employees need to obey and respect the rules that govern the organisation. Good discipline is the result of effective leadership.
(d) Espirit De Corps
This principle states that “Union is Strength” Fayol defined Espirit de Corps as unity of effort through harmony of interest. Promoting team spirit will give the organisation a serve of unity.
Workers should be paid fair wage for their services. The method of wage payment should provide maximum possible satisfaction to both employee and employer.
What steps should the company management take in relation to the above principles to restore the company to its past glory?
The company now realised its folly. In order to rectify the situation ‘F’ limited recommended the following changes.
The company should introduce scientific management with regard to production. In order to separate planning from operational management functional foremanship should be introduced. Work study should be undertaken to optimise the use of resources to motivate the workers ‘Differential piece Rate system’ should be implemented.
Problem II (Related to case problem – I)
The management of Company ‘F’ Limited now realised its folly. In order to rectify the situation it appointed a management consultant .’M’ consultants to recommend a restructure plan to bring the company back on the rails. M’ Consultants undertook a study of the production process at the plant of the company ‘F’ limited and recommended the following changes
1. The company should introduce scientific management with regard to production.
2. Production Planning including routing, scheduling dispatching and feedback should be implemented.
3. In order to separate planning from operational management ‘Functional foremanship’ should be introduced.
4. ‘Word study’ should be undertaken to optimise the use of resources.
5. ‘Standardisation’ of all activities should be implemented to increase efficiency and accountability.
6. To motivate the workers ‘Differential Piece Rate System’
should be implemented.
7. The above changes should, be introduced apart from the steps recommended in case problem-1 (as an answer to question no 3 of that case problem). It was expected that the changes will bring about a radical transformation in the working of the company and it will regain its pristine glory.
Do you think that introduction of scientific management as recommended by M consultants will result in intended outcome?
Yes, to some extent the changes can be brought.
What precautions Should the company undertake to implement the changes?
The company can undertake the following changes
- Production planning
- Optimise the use of resources.