NCERT Solutions for Class 12 Business Studies Chapter 2 Principles of Management

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Short Answer Type

Q1. How is the Principle of ‘Unity of Command’ useful to management? Explain briefly.

Answer: Principle of Unity of Command implies that each and every subordinate should have one and only one boss. Orders and instructions should come from only one head. This helps the working of any organisation in the following manner
(i) Authority responsibility relationship is clearly defined.
(ii) Subordinates are known for whom they are accountable.
(iii) Discipline and order is maintained.

Q2. Define scientific management. State any three of its principles.

Answer: Scientific management can be defined as knowing exactly what you want from men to do and seeing that they do it in the best and cheapest way.
Scientific management aims at choosing the best. Method to get the maximum output from the workers the principles of scientific management are mainly applicable to the shop-floor level.
Three principles of scientific management are as follows
(i) Science, Not Rule of Thumb When different managers use their own different methods to get the work done it is rule of thumb. Taylor believed that there was only one best method to maximise efficiency. Taylor advised that every organisation should compare the results of different methods, test them again and again and finally select one best method of getting the work done.
(ii) Harmony, Not Discord Managers are an extension of the management and serve as a link between workers and the owners. Workers have to take instructions from the managers and managers have to get the work done through the workers. Oftentimes the relation between them is spoilt which is very harmful for everyone-workers, managers and owners. This class conflict should be replaced by harmony between the two. Both should change their thinking towards each other. Both should give importance to each other. This is known as mental revolution.
(iii) Co-operation, Not Individualism There should be complete co-operation between the labour and the management instead of individualism. This principle is an extension of the principle of ‘Harmony not discord.’ The management and the workers should not compete with each other rather co-operate with each other. Management should consider all good suggestions made by the employees which can help in cost reduction. At the same time, workers should never think of going or stickes in order to get their unreasonable demands fulfilled.

Q3. 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?

Answer: The principle of order is violated if an organisation does not provide the right place for physical and human resources.
If this principle is violated then
(i) Lots of time will be wasted in locating the different resources.
(ii) This will lead to delayed decisions.
(iii) Wastage of energy which will lead to in efficiency and delay in production.
(iv) Causes hindrance in the activities of business.

Q4. Explain any four points regarding significance of Principles of management.

Answer: Significance of principles of management
(i) Providing Managers with Useful Insights into Reality When managers follow principles it adds to their knowledge, ability and understanding of managerial situations and circumstances. This improves managerial efficiency e.g., when managers use principle of delegation then they get more time to concentrate on critical areas of working.
(ii) Scientific Decision Making management principles help in thoughtful decision making. They emphasise on logic rather than blind faith. Here, decisions are based on the objective assessment of the situation.
(iii) Optimum Utilisation of Resources and Effective Administration Principles help the managers to conceptualise the net effect of their decision rather than going for trial and error method resulting in saved time, efforts and energy thereby increased productivity.
(iv) Management Training, Education and Research Principles of management are the base for management theory. As such they are used as a basis for management training, education and research. These principles provide basic groundwork for the development of management as a subject. Professional courses like BBA, MBA also teaches these principles as part of their curriculum.

Q5. Explain the principle of ‘Scalar Chain’ and gang plank.

Answer: Principle of Scalar Chain and Gang plank
The formal lines of authority from highest to lowest ranks are known as scalar chain. According to Fayol,
“Organisation should have a chain of authority and communication that runs from top to bottom and should be followed by managers and subordinates.”
In the diagram, O is heading 2 teams where A and X are at the same level, B and Yare at the same level and C and Zare at the same level. The line of communication is clearly defined A to B to C and Xto Y to Z. Authority responsibility relationship is also very clear. But C and Z cannot directly contact each other. This some times may take lot of time during an emergency to communicate as per the prescribed flow to avoid this problem a system known as ‘Gang Plank’ was introduced where in C or Z could contact each other and same way B and Y could contact each other.


Multiple Choice

Q1. Principles of management are NOT
(a) Universal
(b) Flexible
(c) Absolute
(d) Behavioural

Answer: (c) Absolute

Q2. How are principles of management formed?
(a) In a laboratory
(b) By experiences of managers
(c) By experiences of customers
(d) By propagation of social scientists

Answer: (b) By experiences of managers

Q3. The principles of management are significant because of
(a) Increase in efficiency
(b) Initiative
(c) Optimum utilisation of resources
(d) Adaptation to changing technology

Answer: (c) Optimum utilisation of resources

Q4. Henri Fayol was a
(a) Social Scientist
(b) Mining Engineer
(c) Accountant
(d) Production engineer

Answer: (b) Mining Engineer

Q5. 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

Answer: (a) Work should be divided into small tasks

Q6. ‘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

Answer : (c) Gang Boss

Q7. 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

Answer: (b) Functional foremanship

Q8. 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

Answer: (d) Method Study

Q9. 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.

Answer: (a) It implies change of attitude.

Q10. Which of the following statements 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.

Answer: (b) Fayol’s principles are applicable in specialised situations whereas Taylor’s principles have universal application


Long Answer Questions

Q1. Explain the principles of scientific management given by Taylor.

Answer: Principles of scientific management are given by FW Taylor
(i) Science, Not Rule of Thumb When different managers use their own different methods to get the work done it is rule of thumb. Taylor believed that there was only one best method maximise efficiency. Taylor advised that every organisation should compare the results of different methods, test them again and again and finally select one best method of getting the work done.
(ii) Harmony, Not Discord Managers are an extension of the management and serve as a link between workers and the owners. Workers have to take the instructions from the managers and managers have to get the work done through the workers. Sometime the relation between them is spoilt, which is very harmful for everyone-workers, managers and owners. This class conflict should be replaced by harmony between the two. Both should change their thinking towards each other. This is known as mental revolution.
(iii) Co-operation, Not Individualism There should be complete co-operation between the labour and the management instead of individualism. This principle is an extension of principle of harmony, not discord. The management and the workers should not compete with each other rather co-operate with each other. Management should consider all good suggestions made by the employees which can help in cost reduction. At the same time workers should never think of going on strikes in order to get their unreasonable demands fulfilled.
(iv) Development of Each and Every person to His or her Greatest Efficiency and Prosperity
Scientific management also stood for worker development. Taylor believed that workers should be aware of the ‘best method’. On the other hand, all organisations should select employee carefully in order to get maximum efficiency. When the duties are allotted, perfect match should be made between the requirements of the job and the capabilities of the worker. Training should be provided to improve the skills further. In this way, efficiency will go higher resulting in prosperity for both workers and company.

Q2. Explain the following principles of management given by Fayol with examples.
(a) Unity of direction
(b) Equity
(c) Espirit de Corps
(d) Order
(e) Centralisation and decentralisation
(f) Initiative

Answer: Fayol introduced general principles of management. Some of them have been explained below
(a) Unity of Direction
All the units of an organisation should be moving towards the same objective. Each group of activities having the same objective must have one head and one plan. Each group should have its own incharge and on no account the working of two divisions neither be overlaped.
(b) Equity
This principle emphasise kindliness and justice in the behaviour of managers towards workers. This will ensure loyalty and devotion. Lazy personnel should be dealt sternly and strictly. There should be no discrimination against anyone on account of gender, religion, caste, language or nationality etc. All decisions should be merit based.
(c) Espirit de Corps
This principle emphasises on building harmony and team spirit among employees. In a large organisation due to a large work force teamwork is very important. Teamwork leads to better co-ordination while working. The head of each team should give credit of good result to the whole team rather than confining it to his ownself.
(d) Order
A place for everything and everyone in his/her place. Basically it means orderlinss. If there is a fixed place for different things in a factory and they remain in their places then no time is wasted in locating them. Same way if every personnel is allocated an area to operate from then his co-workers, head or subordinates, anyone can contact him easily.
(e) Centralisation and Decentralisation Concentration of authority in a few hands is centralisation and its dispersal among more number of people is decentralisation. Fayol believed that an organisation should not work with anyone of them in isolation. A combination of both is important simple, easy and work of routine type should be decentralised and critical important type of work should be centralised.
(f) Initiative Initiative means taking the first step with self-motivation workers should be encouraged to develop and carry out their plans for improvements according to Fayol. Initiatives should be encouraged. A good company should invite suggestions from employees which can result in substantial cost/time reduction. Rewards can be given to fruitful suggestions.

Q3. Explain the technique of ‘Functional Foremanship’ and the concept of ‘Mental Revolution’ as enunciated by Taylor.

Answer: Functional Foremanship Taylor advocated separation of planning and execution functions. This concept was extended to the lowest level of the shop floor. It was known as functional foreman ship.


Under the factory manager, there is a planning incharge and a production incharge.
Under the planning incharge, the work goes as follows
(i) Instruction Card Clerk Draft instructions for the workers.
(ii) Route Clerk Specify the route of production.
(iii) Time and Cost Clerk Prepare time and cost sheet.
(iv) Disciplinarian Ensure discipline.
Under the production incharge, the work goes as follows
(i) Speed Boss Timely and accurate completion of work.
(ii) Gang Boss Keeping tools and machines ready for operation by workers.
(iii) Repairs Boss Ensure proper working conditions of machines.
(iv) Inspector Check the quality of work.
Mental Revolution
In a factory, the managers served as a link between the owners and the workers. The managers have to get the work done from the workers which created sometimes problem between the two. Taylor emphasized that there should be harmony between the management and workers. Both should realise that each one is important. For this both had to change their thoughts for each other, This is known as ‘Mental Revolution’. Management should share the gains of the company with the workers and at the same time workers should work hard and be ready to accept any change made for the betterment of the organisation.

Q4. 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

Answer: Some of the techniques of scientific work study are
(a) Time Study It determines the standard time taken to perform a well-defined job. The standard time is fixed for the whole of the task by taking several readings. The method of time study will depend upon volume and frequency of the task, the cycle time of the operation and time measurement costs. There are three objectives achieved through time study.
(i) Determine the number of workers.
(ii) Frame suitable incentive schemes.
(iii) Determines labour costs.
e.g., if standard time taken to do a piece of work in 20 minutes then one work can be done 3 times in an hour and total 21 times (3×7 hours per day) the work can be done on a single day.
(b) Motion Study Motion study refers to the study of movements like lifting, putting objects, sitting and changing positions. On close examination of body motions, e.g., it is possible to find out three types motions
(i) Motions which are productive.
(ii) Motions which are incidental.
(iii) Motions which are unproductive.
Out of the above, three workers were motivated to eliminate the third type completely and reduce the second one to the minimum. This help in increasing productivity.

(c) Fatigue Study Fatigue study seeks to determine the amount and frequency of rest intervals in completing a task. A person is bound to feel tired physically and mentally if he does not take rest while working. The next intervals will heip one to regain stamina and work again with the same efficiency for e.g., in an organisaton working hours are 9 to 5. There is a lunch break of an hour for the workers to take rest similarly in a school there is a break for the students and teachers after 4 periods of continuous learning.
(d) Method Study The objective of method study is to find out one best way of doing the job. Different managers would use their own different methods of getting the work done. But there is always one best method. Right from procurement of raw materials till the final product is delivered to the customer every activity is the part of method study. The objective of whole exercise is to minimise the cost of production and maximise the satisfaction of the customer.
(e) Simplification and Standardisation of Work Standardisation refers to the process of setting standards for every business activity e.g., process, raw material, time, product, machinery, methods or working conditions. The objective of standardisation are
(i) To reduce product to fixed types, sizes, features etc.
(ii) To establish interchangeability of various parts.
(iii) To establish standards of excellence and quality in materials.
(iv) To establish standards of performance of men and machines.
Simplification aims at eliminating unnecessary diversity of products. It results in savings of cost of labour, machines and tools. It implies reduced inventories, fuller utilisation of equipment and increasing turnover.

Q5. Discuss the differences between the contributions of Taylor and Fayol.

Basis of DifferenceContributions of Henri FayolContributions of F.W. Taylor
PerspectiveMain concentration on Top level of
management
Main concentration on Shop floor level of a factory
Unity of CommandHe was Staunch ProponentHe did not feel that it is important as under functional foremanship a worker received orders from eight specialists
ApplicabilityPrinciples are accepted everywhere and are universal in nature.Principles are applicable to specialized situations.
Basis of formation  Theories are based on Personal experienceTheories are based on Observations and experimentation
Focus The main focus was on improving overall
administration
The main focus was on increasing Productivity
PersonalityFayol was a mining engineer or practitioner.Taylor was a mechanical engineer or scientist. 
Expression  General Theory of AdministrationScientific Management

Q6. Discuss the relevance of Taylor and Fayol’s contribution in the contemporary business environment.

Answer: Relevance of Taylor and Fayol’s contribution in the contemporary business environment.
Both Fayol and Taylor have given principles of management to improve efficiency in an organisation. Taylor gave us scientific principles of management which are being adopted by all organisations to improve its productivity at the shop floor level, the principles help in giving effective results. In the same manner, Henry Fayol gave in general principles of management which when implemented at any of the levels-top, middle or lower and helps in achieving better co-ordination, remove ambiguity and encourage the employees to improve their work performance.


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