CHAPTER 2 PRINCIPLES OF MANAGEMENT (Class 12) CBSE

PART A- PRINCIPLES OF MANAGEMENT

1. In order to be successful an organization must change its goals according to the needs to the environment. Which characteristic of management is highlighted in the statement? 

Management is a dynamic function: Management is a dynamic function and has to adapt itself to the changing environment. An organisation interacts with its external environment which consists of various social, economic and political factors. In order to be successful, an organisation must change itself and its goals according to the needs of the environment. You probably know that McDonalds, the fast food giant made major changes in its menu to be able to survive in the Indian market. 

2. To meet the objectives of the firm the Management of Angora Limited offers employment to Physically Challenged persons. Identify the organizational objective it is trying to achieve .

Management of Angora Limited is trying to achieve Social Objectives of the organisation.

3. Management of any organization strives to attain different objectives. Enumerate three objectives.

Management seeks to achieve certain objectives which are the desired result of any activity. They must be derived from the basic purpose of the business. In any organisation there are different objectives and management has to achieve all objectives in an effective and efficient manner. Objectives can be classified into organisational objectives, social objectives and personal or individual objectives. 

(i) Organisational Objectives: Management is responsible for setting and achieving objectives for the organisation. It has to achieve a variety of objectives in all areas considering the interest of all stakeholders including, shareholders, employees, customers and the government. The main objective of any organisation should be to utilize human and material resources to the maximum possible advantage, i.e., to fulfill the economic objectives of a business. These are survival, profit and growth. 

Survival: The basic objectives of any business is survival. Management must strive to ensure the survival of the organisation. In order to survive, an organisation must earn enough revenues to cover costs. 

Profit: Mere survival is not enough for business. Management has to ensure that the organisation makes a profit. Profit provides a vital incentive for the continued successful operation of the enterprise. Profit is essential for covering costs and risks of the business.

Growth: A business needs to add to its prospects in the long run, for this it is important for the business to grow. To remain in the industry, management must exploit fully the growth potential of the organisation. Growth of a business can be measured in terms of sales volume increase in the number of employees, the number of products or the increase in capital investment, etc. There can be other indicators of growth.

(ii) Social objectives: It involves the creation of benefit for society. As a part of society, every organisation whether it is business or non-business, has a social obligation to fulfill. This refers to consistently creating economic value for various constituents of society. This includes using environmental friendly methods of production, giving employment opportunities to the disadvantaged sections of society and providing basic amenities like schools and day care centers to employees. 

(iii) Personal objectives: Organisations are made up of people who have different personalities, backgrounds, experiences and objectives. They all become part of the organisation to satisfy their diverse needs. These vary from financial needs such as competitive salaries and perks, social needs such as peer recognition and higher level needs such as personal growth and development. Management has to reconcile personal goals with organisational objectives for harmony in the organisation. 

4. Give any two characteristics of management. 

The key features of management are:

 (i) goal oriented process (ii) all pervasive (iii) multidimensional (iv) continuous process (v) group activity (vi) dynamic function (vii) tangible force. 

After going through some of the definitions we find some elements that may be called the basic characteristics of management: 

(i) Management is a goal-oriented process: An organisation has a set of basic goals which are the basic reason for its existence. These should be simple and clearly stated. Different organisations have different goals. For example, the goal of a retail store may be to increase sales, but the goal of The Spastics Society of India is to impart education to children with special needs. Management unites the efforts of different individuals in the organisation towards achieving these goals. 

(ii) Management is all pervasive: The activities involved in managing an enterprise are common to all organisations whether economic, social or political. A petrol pump needs to be managed as much as a hospital or a school. What managers do in India, the USA, Germany or Japan is the same. How they do it may be quite different. This difference is due to the differences in culture, tradition and history. 

(iii)Management is multidimensional: Management is a complex activity that has three main dimensions. 

These are: 

Management of work: All organisations exist for the performance of some work. In a factory, a product is manufactured, in a garment store a customer’s need is satisfied and in a hospital a patient is treated. Management translates this work in terms of goals to be achieved and assigns the means to achieve it. This is done in terms of problems to be solved, decisions to be made, plans to be established, budgets to be prepared, responsibilities to be assigned and authority to be delegated. 

Management of people: Human resources or people are an organisation’s greatest asset. Despite all developments in technology “getting work done through people” is still a major task for the manager. Managing people has two dimensions (i) it implies dealing with employees as individuals with diverse needs and behavior; (ii) it also means dealing with individuals as a group of people. The task of management is to make people work towards achieving the organisation’s goals, by making their strengths effective and their weaknesses irrelevant.

Management of operations: No matter what the organisation, it has some basic product or service to provide in order to survive. This requires a production process which entails the flow of input material and the technology for transforming this input into the desired output for consumption. This is interlinked with both the management of work and the management of people.(iv) Management is a continuous process: The process of management is a series of continuous, composite, but separate functions (planning, organizing, directing, staffing and controlling). These functions are simultaneously performed by all managers all the time. You may have observed that Suhasini at Fabmart performs several different tasks in a single day. Some days she may spend more time in planning a future exhibition and on another day she may spend time in sorting out an employee’s problem. The task of a manager consists of an ongoing series of functions. 

(v) Management is a group activity: An organisation is a collection of diverse individuals with different needs. Every member of the group has a different purpose for joining the organisation but as members of the organisation they work towards fulfilling the common organisational goal. This requires team work and coordination of individual effort in a common direction. At the same time management should enable all its members to grow and develop as needs and opportunities change. 

(vi) Management is a dynamic function: Management is a dynamic function and has to adapt itself to the changing environment. An organisation interacts with its external environment which consists of various social, economic and political factors. In order to be successful, an organisation must change itself and its goals according to the needs of the environment. You probably know that McDonalds, the fast food giant made major changes in its menu to be able to survive in the Indian market. 

(vii) Management is an intangible force: Management is an intangible force that cannot be seen but its presence can be felt in the way the organisation functions. The effect of management is noticeable in an organisation where targets are met according to plans, employees are happy and satisfied, and there is orderliness instead of chaos. 

5. Management is multidimensional. Enumerate dimensions of management. 

Management comprises of three dimensions, viz: 

Management of work: It is concerned with performance of tasks in an organisation.

Management of people: It implies dealing with employees as individuals and dealing with individuals as a group.

Management of operations: It is interlinked with both management of work and management of people.

6. Managerial activities are performed in all types of organizations in all departments at all levels. Which management character is highlighted here?

It is all pervasive:The activities involved in managing an enterprise are common to all organisations whether economic, social or political. A petrol pump needs to be managed as much as a hospital or a school. What managers do in India, the USA, Germany or Japan is the same. How they do it may be quite different. This difference is due to the differences in culture, tradition and history. 

7. Your grandfather has retired where he is responsible for implementing the plans developed by the top management at which level of management he was working? State one more function of this level of management.

Middle managers are in charge of facilitating any changes needed in an organization and creating an effective working environment. They administer day-to-day routines, monitors performance and make sure everything is done in compliance with organization's needs.

  Role of Middle-Management  

• Designing and implementing effective group work and information systems.
• Defining and monitoring group-level performance indicators.
• Diagnosing and resolving problems within and among work groups.
• Designing and implementing reward systems.
• Supporting cooperative behavior.

Functions of Middle Level Management

• To interpret & explain the policies framed by top management
• To compile & issue detailed instructions regarding operations.
• To maintain close contacts with operating results so as to evaluate performance.
• To participate in operating decisions
• To cooperate among themselves so as to integrate or coordinate various parts of a division or a department.

8. Your grandfather has retired as a Director of manufacturing company. At which level of management was he working? Different functions are performed at this level. State any one such function. 

Top Management: They consists of the senior-most executives of the organisation by whatever name they are called. They are usually referred to as the chairman, the chief executive officer, chief operating officer, president and vice-president. Top management is a team consisting of managers from different functional levels. Their basic task is to integrate diverse elements and coordinate the activities of different departments according to the overall objectives of the organisation. These top level managers are responsible for the welfare and survival of the organisation. They analyse the business environment and its implications for the survival of the firm. They formulate overall organisational goals and strategies for their achievement. They are responsible for all the activities of the business and for its impact on society. The job of the top manager is complex and stressful, demanding long hours and commitment to the organisation. 

9. Explain the supervisory role of mangers in an organisation.
Supervisory or Operational Management: Foremen and supervisors comprise the lower level in the hierarchy of the organisation. Supervisors directly oversee the efforts of the workforce. Their authority and responsibility is limited according to the plans drawn by the top management. Supervisory management plays a very important role in the organisation since they interact with the actual work force and pass on instructions of the middle management to the workers. Through their efforts quality of output is maintained, wastage of materials is minimized and safety standards are maintained. The quality of workmanship and the quantity of output depends on the hard work, discipline and loyalty of the workers.

10. What is meant by management.

 Management is a very popular term and has been used extensively for all types of activities and mainly for taking charge of different activities in any enterprise.
“Management is defined as the process of planning, organizing, actuating and controlling an organisation’s operations in order to achieve coordination of the human and material resources essential in the effective and efficient attainment of objectives.”
-Robert L. Trewelly and M. Gene Newport

11. The Activities involved in managing an enterprise are common to all organizations whether economic, social or political. Which characteristics of management is highlighted by this statement?

Management is all pervasive: The activities involved in managing an enterprise are common to all organisations whether economic, social or political. A petrol pump needs to be managed as much as a hospital or a school. What managers do in India, the USA, Germany or Japan is the same. How they do it may be quite different. This difference is due to the differences in culture, tradition and history. 

12. Policy formation is the function of which level of management?
Top level management are responsible for policy formation.
13. Who are considered as Operative managers?

The lower level managers are considered as operating managers because they look after the operations of the business that is the production of goods and services by guiding and supervising the employees. Operating managers pass on the instructions to workers and report to the middle level managers. 

14. “Management is considered to be a three-tier machinery”. Why?

Most organizations have three management levels: first-level, middle-level, and top-level managers. These managers are classified according to a hierarchy of authority and perform different tasks. In many organizations, the number of managers in each level gives the organization a pyramid structure. 

15. Name the process by which a manager synchronizes the activities of different departments.
The process through which the managers synchronize the activities of all the departments is coordination.

16. How is entry to a profession restricted? 

Restricted entry: The entry to a profession is restricted through an examination or through acquiring an educational degree. For example, to become a chartered accountant in India a candidate has to clear a specified examination conducted by the Institute of Chartered Accountants of India. 

17. State any two points which prove that management is multi-dimensional? 

Management is considered as a multi-faceted concept because it is a complex activity that has three main dimensions.

 These are 

Management of Work: All organisations perform some work e.g., producing or selling. A work is defined as the goals to be achieved. Management of People: The main asset of an organisation is the human resources. This resource has to be managed in such a manner that it helps to achieve the goals of the organisations.Management of Operations: All organisations either produce a product or provide a service. This requires a production process which means using an operation to convert the inputs into the output. It is interlinked with both management of work and management of output

18. Who is a global manager today? A global manager today is one who possesses what can be termed as ‘hard’ types of skills as well as ‘softer’ types of skills. Managers who understand analysis, strategy, engineering, and technology are still going to be needed, but extremely critical to global success are people who understand how teams work, how organisations work, how people are motivated. 

A manager who really understands different cultures should be able to work in a West European, non-English speaking country, then move to a developing country like Malaysia or Kenya, and then be transferred to an office based in New York, USA, and be almost immediately productive in all three places. 

It can thus be understood that the role of a global manager has evolved in much the same way that the global industry and economy have evolved. It has changed from being a single dimensional role in a defined business context, to being a multi-faceted role that calls for a diverse combination of technical skills, soft management and people skills, and the ability to imbibe and learn different cultural experiences