BST First Book

UNIT-1
NATURE AND SIGNIFICANCE OF MANAGEMENT
Management is an art of getting things done through others. Management can be defined as, the
process of getting things done with the aim of achieving goals effectively and efficiently.
EFFICIENCY AND EFFECTIVENESS

Efficiency means doing the task correctly at minimum cost while effectiveness means completing the
task correctly. Although efficiency and effectiveness are different but they are interrelated. It is
important for management to be both i.e. Effective and efficient.
Example : A business produces targeted 1000 units but at a higher cost is effecitive but not efficient.
Therefore if the business has to be effective and efficient then it has to produce 1000 units within cost.
CHARACTERISTICS OF MANAGEMENT
1. Goal oriented process -It is a goal oriented process, which is undertaken to achieve already
specified and desired objectives.
2. Pervasive- Management is pervasive in nature. It is used in all types of organizations whether
economic, social or political and at every level.
3. Multidimensional - It is multidimensional as it involves management of work, people and
operations.
4. Continuous - It is a continuous process i.e. Its functions are being performed by all managers
simultaneously. The process of management continue till an organisation exist for attaining its
objectives.
5. Group activity : It is a group activity since it involves managing and coordinating activities of
different people as a team to attain the desired objectives.
6. Dynamic function : It is a dynamic function since it has to adapt to the changing environment.
7. Intangible force : It is an intangible force as it cannot be seen but its effect are felt in the form of
results like whether the objectives are met and whether people are motivated or not.
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OBJECTIVES OF MANAGEMENT
(A)Organizational objectives of survival (earning enough revenues to cover cost); profit (to cover cost
and risk); & growth (to improve its future prospects).
(b) Social objectives of giving benefits to society like using environmental friendly practices and giving
employment to disadvantaged sections of society etc.
(c) Personal objectives because diverse personal objectives of people working in the organization have
to be reconciled with organizational objectives.
IMPORTANCE OF MANAGEMENT
(1) ACHIEVING GROUP GOALS : MANAGEMENT HELPS IN ACHIEVING GROUP GOALS. MANAGER GIVE
COMMON DIRECTION TO THE INDIVIDUAL EFFORT IN ACHIEVING THE OVERALL GOAL OF THE
ORGANISATION.
(2) INCREASES EFFICIENCY : MANAGEMENT INCREASES EFFICIENCY BY USING RESOURCES IN THE BEST
POSSIBLE MANNER TO REDUCE COST AND INCREASE PRODUCTIVITY.
(3) CREATES DYNAMIC ORGANISATION : MANAGEMENT HELPS IN CREATING DYNAMIC ORGANISATION

WHICH COULD ADOPT CHANGING SITUATIONS EASILY.
(4) ACHIEVING PERSONAL OBJECTIVES : MANAGEMENT HELPS IN ACHIEVING OBJECTIVES OF

INDIVIDUALS WORKING IN THE ORGANISATION.
(5) DEVELOPMENT OF SOCIETY : MANAGEMENT HELPS IN THE DEVELOPMENT OF SOCIETY BY

PRODUCING GOOD QUALITY PRODUCTS, CREATING EMPLOYMENT OPPORTUNITIES AND ADOPTING
NEW TECHNOLOGY.
MANAGEMENT AS AN ART
Art refers to skillful and personal application of existing knowledge to achieve desired results. It can be
acquired through study, observation and experience.
The features of art are as follows.
(1) Existence of theoretical knowledge :In every art systematic &organised study material should be
available compulsorily to acquire theoretical knowledge.
(2) Personalised application :The use of basic knowledge differ from person to person and thus, art
is a very personalised concept.
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(3) Based on practice and creativity : Art involves the creative practice of existing theoretical
knowledge.
All the features of art are present in management so it can be called an art.
MANAGEMENT AS A SCIENCE
Science is a systematised body of knowledge that is based on general truths which can be tested
anywhere, anytime. The features of science are as follows
(1) Systematized Body Of Knowledge: Science has a systematised body of knowledge based on
principles and experiments.
(2) Principles Based On Experiments &Observation : Scientific principles are developed through
experiments and observations.
(3) Universal Validity: Scientific principles have universal validity and application. Management
has systematic body of knowledge and its principles are developed over a period of time based on
repeated experiments & observation, which are universally applicable.
As the principles of management are not as exact as the principles of pure science, so it may be called
inexact science.
MANAGEMENT AS A PROFESSION
Profession means an occupation for which specialised knowledge and skills are required.
The main features of profession are as follows
(1) Well Defined Body Of Knowledge : All the professions are based on well defined body of
knowledge.
(2) Restricted Entry : The entry in every profession is restricted through examination or through
some minimum educational qualification.
(3) Professional Associations : All professions are affiliated to a professional association which
regulates entry and frame code of conduct relating to the profession.
(4) Ethical Code Of Conduct : All professions are bound by a code of conduct which guides the
behaviour of its members
(5) SERVICE MOTIVE :The main aim of a profession is to serve its clients.
Management does not fulfill all the features of a profession and thus it is not a full pledged profession.
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LEVELS OF MANAGEMENT
:
• TOP LEVEL MANAGEMENT
• MIDDLE LEVEL MANAGEMENT

Top level consists of chairperson, chief
• OPERATIONAL LEVEL MANAGEMENT executive officer, chief operating officer or
equivalent and their team. Chief task is to
integrate and to coordinate the various
activities of the business, framing policies, formulating organisational goals & strategies.
Middle level consists of divisional heads, plant superintendent and operations manager etc. Main
tasks are to interpret the policies of the top management, to ensure the availability of resources
to implement policies & to coordinate all activities, ensure availability of necessary personnel &
assign duties &responsibilties to them.
Lower level / supervisory level consists of foremen and supervisors etc. Main task is ensure actual
implementation of the policies as per directions, bring workers grievances before the
management & maintain discipline among the workers
FUNCTIONS OF MANAGEMENT
 Planning is deciding in advance what to do in future and how to do it.

 Organizing is to assign duties, grouping tasks, establishing authority and allocating
resources required to carry out a specific plan.
 Staffing is finding the right people for the right job.
 Directing is leading, influencing and motivating employees to perform the tasks assigned
to them.
 Controlling is monitoring the organizational performance towards the attainment of
organizational goals.
COORDINATION : THE ESSENCE OF MANAGEMENT :
Coordination is the force which synchronizes all the functions of management and activities of different
departments.
 It integrates the group efforts.

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 It ensure unity of action.
 It is a continuous process.
 It is an all pervasive function.
 It is a deliberate function.
 It is the responsibility of all managers
CASE STUDIES
Q1 MR.HARISH PRODUCED 200 T SHIRTS THREE DAYS BEFORE TIME. HE PAID OVER TIME TO HIS WORKERS TO COMPLETE
PRODUCTION BEFORE TIME. DO YOU THINK MR. HARISH IS EFFECTIVE AND EFFICIENT? GIVE REASON IN SUPPORT OF YOUR
ANSWER.
Q2 PRIYA ENTERPRISES, A COMPANY, WAS INITIALLY PRODUCING GRINDERS AND MIXERS .NOW, WITH THE CHANGING
SCENARIO AND EMERGING TRENDS OF WORKING WOMEN THERE IS A GREATER DEMAND FOR A PRODUCT WHICH IS
MORE EFFICIENT AND A MULTITASKED. ON ANALYZING THE SITUATION, THE COMPANY DECIDED TO PENETRATE INTO THE
MARKET FOR PRODUCING FOOD PROCESSOR.
(A)WHICH FEATURE OF MANAGEMENT IS HIGHLIGHTED HERE?
(B)WHICH LEVEL OF MANAGEMENT WILL TAKE THIS DECISION?
Q3 ALIA ENTERPRISES, A COMPANY WAS INITIALLY PRODUCING GRINDERS AND MIXERS .NOW WITH THE CHANGING
SCENARIO AND EMERGING TRENDS OF WORKING WOMEN THERE IS A GREATER DEMAND FOR A PRODUCT WHICH IS
MORE EFFICIENT AND MULTI-TASKER. ON ANALYZING THE SITUATION, THE COMPANY DECIDED TO PENETRATE INTO THE
MARKET FOR PRODUCING FOOD PROCESSOR.
(A)WHICH FEATURE OF MANAGEMENT IS HIGHLIGHTED HERE.
(B)WHICH LEVEL OF MANAGEMENT WILL TAKE THIS DECISION .
(C)STATE ANY TWO DESIGNATION OF THE LEVEL OF MANAGEMENT IDENTIFIED IN (B)ABOVE.
Q4 WHY THE PRESENCE OF MANAGEMENT IS FELT AS MUCH AT A PETROL PUMP AS IN A BIG FACTORY? GIVE REASON.
Q5 KITTO& COMPANY IS FACING A LOT OF PROBLEMS THESE DAYS. IT MANUFACTURES WASHING MACHINE,
REFRIGERATORS AND AIR-CONDITIONERS. THE COMPANY’S MARGIN ARE UNDER PRESSURE AND THE PROFITS AND
MARKET SHARE ARE DECLINING. MR.KAILASH ANALYZED THE BUSINESS CONDITIONS AND ENVIRONMENT AND PLANNED
TO GET THE NEW TECHNOLOGY FOR THEIR BUSINESS. HE COORDINATED WITH MR.BHUSHAN TO PURCHASE THE SAME.
MR.BHUSHAN AFTER PURCHASING THE TECHNOLOGY COORDINATED WITH MR. SUNDER FOR USING THE TECHNOLOGY IN
MANUFACTURING THE GOODS AND REPORTED THE SAME TO MR.KAILASH. MR. SUNDER CALLED MR.HIMANSHU TO GUIDE
THE WORKERS FOR USING THE TECHNOLOGY. MR.HIMANHSU STARTED GUIDING AND SUPERVISING THE WORKERS FOR
THE SAME AND SENDING THE REPORT TO MR.SUNDER. MRSUNDER AFTER GETTING THE REPORT FROM MR.HIMANSHU
REPORTED TO MR.KAILASH ABOUT THE PERFORMANCE OF THE TECHNOLOGY.
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A) IDENTIFY THE POSITIONS OF MR.KAILASH, MR.BHUSHAN, MR.SUNDER AND MR.HIMANSHU WITH THEIR
DESIGNATION BY QUOTING THE LINE OF FUNCTION FROM THE ABOVE PARA.
B) NAME THE LEVEL OF MANAGEMENT AT WHICH THESE PEOPLE ARE WORKING.
Q6. MOTU, A POPULAR STUDENT OF CLASS XII OF MEMORIAL PUBLIC SCHOOL, WAS MADE HEAD OF THE TEAM FOR
ORGANIZING FAREWELL. MOTU WAS ASKED TO ENSURE THAT ALL TEAM MEMBERS PERFORM THE TASK ASSIGNED TO
THEM WELL IN TIME SO THAT THERE IS NO CONFUSION, NO GAPS AND NO CONFLICTS. PATLU, MOTU’S BEST FRIEND, WAS
GIVEN THE TASK OF FOOD ARRANGEMENTS. PATLU, ASKED MOTU TO DO SOME OF FOOD ARRANGEMENTS BUT MOTU
DENIED HIM, SAYING THAT HE IS TOO BUSY. PATLU WAS DISAPPOINTED. MOTU KEPT ON MAKING PHONE CALLS FOR
ENSURING SYNCHRONIZATION AND INTEGRATION OF TASKS PERFORMED BY THE TEAM MEMBERS. IN ANGER, PATLU
COMPLAINED OF MOTU TO THE CLASS TEACHER THAT MOTU WAS NOT DOING ANYTHING.
(A)WHICH ASPECT OF MANAGEMENT IS BEING PERFORMED BY MOTU?
(B)DISCUSS THE SIGNIFICANCE OF CONCEPT IDENTIFIED IN PAR (A).
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UNIT-2
Principles of management
1. Meaning: the principles are broad statement of fundamental truth which provide guide lines
for management decision and action. These guidelines are derived through experimentation
and observation institute .
2. Nature of principles of management
 Universal application can be applied to all kind of organisations, irrespective
of their size and nature.
 General guidelines the formulated guidelines to action which need to be
adjusted and used as per the demands of the situation.
 Formed by practice and experimentation derived through experimentation and
observation.
 flexible principles are not rigid like science but are modified according to the
business environment needs.
 Behavioural the principles aim to influence the unpredictable, complex and
dynamic human behaviour.
 Cause andeffect relation they aid in predicting the outcome of management actions.
 contingent the management principles are dependent upon the prevailing
conditions/situations at that particular time hence amended accordingly.
3.Significance/ importance of management
 Principles provide managers with useful insights into reality through improved
knowledge, ability, understanding and improved guidance to the managers.
 Optimum utilisation of resources and effective administration through
coordinated use of physical, financial and human resources.
 scientific decision they lend to be more realistic, thoughtful, justifiable and
free from personal bias.
 Meetthe changing environmental requirements by providing effective
and dynamic leadership in implementing changes.
 fulfils social responsibility guides the manager in fulfilling the social responsibility.
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 management training, education and research -the principles help in
increasing knowledge which is used as the basis for management training and research.
Fayol’s principles of management
1. Division of work- work could be divided into small specialised task and
performed by a trained specialist
2. Authority and responsibility there must be a right balance between

authority (right to give orders) and responsibility (obligation to perform the assigned task)
3. Discipline obedience to organisation rules and employment agreement.
4. Unity of command receive orders from one boss. One subordinate must have only and only one boss.
5. Unity of direction all the units of the organisation should aim and move
towards achieving the organisational goal. “ONE HEAD ONE PLAN”
6. Subordination of individual interest to general interest the organisation intere st to

be prioritised over individual interest.
7. Remuneration of employees pay should be fair and satisfying to both employee and
the organisation.
8. Centralisation and decentralisation there should be a proper balance

between centralisation (concentration of decision making powers with top management) and
decentralisation (dispersal of decision making power among more tha s n one per on).
9. Scalar chain orders or communication should pass from top to bottom

and follow the official line of command.
10. Order- a place for everything/ everyone and every one in its place
11. Equality kindness, empathy and justice in the behaviour of manager towards workers.
12. stability of personnel frequent displacement of employee from their position should be
avoided. They should be given sufficient time to show their results and employee turnover ratio
must be minimized.
13. Initiative employees to be encouraged to develop and carry out their improvement plans
14. Espirit de corps need for team work, spirit and harmony.
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. Principles of scientific management- F.W. taylor
1. Science not rule of thumb

there should be scientific study and analysis of each element of job rather than adopting old rule of
the thumb approach on a hit and miss method. Encourage “thinking before doing”.
2. Harmony not discord there should be complete harmony and proper understanding between
management and workers in achieving the organisation goals.
3. Cooperation not individualism taylor emphasised on the importance of cooperative group

effort between the management and workers in achieving the organisation’s goals
and not individualism.
4. Development of workers to their greatest efficiency and prosperity: the management should
scientifically select the workers; assign job as per
their physical, mental and intellectual capability and potential; and train
them as per the job requirement.
Techniques of scientific management-F.W. TAYLOR
A) Functional foremenship
• supervision is to be divided into several specialized functions and each
function to be entrusted to a special foreman.
• each worker will have to take orders from eight foremen in the related process
of function of production.
B) Standardisation and simplification of work
• process of setting standards for every business activity to maximise output
. • simplification is eliminating unnecessary varieties, sizes and grades of
product manufactured in the organisation.
C) Method study
• finding one best way of doing a job.
• critical analysis is made for pant layout, product design, material handling
and work processes using techniques like process charts, operations research etc.
D) Motion study
• making a thorough analysis of various motions being performed by a
worker while doing a particular task.
• identifying and determining the ideal productive movement.
• eliminate the unproductive movements and equipments.
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E) Time study
• it is the technique used to determine the standard time taken by the
workman with reasonable skill and ability to perform a particular task.
• here the job is divided into series of elements and the time required to
complete each element idealistically is recorded using a stop watch.
F) Fatigue study
• determines the amount and frequency of rest intervals required in completing a task.
G) Differential piece wage system
• evolve a system wherein the efficient and inefficient workers are paid at
different rates, as financial incentives act as motivators.
• first a standard task is established with the aid of time and motion study, then
two rates are established. Higher when standard output are produced and lower when the
standard is not met
Taylor v/s Fayol
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CASE STUDIES
Q1 SHREE ENTERPRISES IMPORTS VARIOUS COMPONENTS FROM CHINA AND ASSEMBLES THEM TO MAKE A COMPLETE
COMPUTER. THE TOTAL WORK INVOLVES THREE DIFFERENT TASKS, ASSEMBLING, PACKAGING AND LABELING OF
COMPUTERS. EACH EMPLOYEES OF THE COMPANY INDEPENDENTLY PERFORMS ALL THE THREE TASKS.
(A)IDENTIFY THE PRINCIPLE OF MANAGEMENT IGNORED BY SHREE ENTERPRISES.
(B)WHAT PROBLEMS MIGHT BE FACED BY THE MANAGEMENT OF THE FIRM, IN CASE THE ABOVE MENTIONED PRINCIPLE IS
NOT FOLLOWED?
Q2 IDENTIFY AND EXPLAIN THE MANAGEMENT PRINCIPLES FOLLOWED/VIOLATED IN EACH OF THE FOLLOWING CASES:
A) THERE WERE THREE MEN WORKING IN A GARMENT FACTORY. THEY MADE SHIRTS, PACKED THEM,
LABELED THEM AND TRANSPORTED THEM TO THE WAREHOUSES.
B) THE MINISTER WAS A GRADUATE IN ENGLISH. HE PROMOTED ONLY THOSE OFFICERS IN HIS MINISTRY
WHO HAD COMPLETED THEIR GRADUATION IN THE SAME SUBJECT.
Q3 RAJEEV IS MIDDLE LEVEL MANAGER. HE KEEPS ALL HIS SUBORDINATES UNDER A LOT OF DISCIPLINE. HIS EMPLOYEES
HOWEVER COMPLAIN OF WASTAGE OF TIME AND EFFORTS AS THEY SAY NOTHING IS BEING ASSIGNED A PROPER PLACE
AND NO PROPER SCHEDULE IS MADE FOR WORKING. WHICH PRINCIPLE OF MANAGEMENT IS VIOLATED HERE?
Q4 SETHI INDUSTRIES IS FACING A LOT OF OPPOSITION AS IT PAYS LESS SALARY TO FEMALE WORKERS AS COMPARED TO
MALE WORKERS FOR EQUAL WORK. IDENTIFY AND EXPLAIN THE PRINCIPLE OF MANAGEMENT, WHICH IS NOT FOLLOWED
BY SETHI INDUSTRIES.
Q5 DIRECTORS OF A LIMITED COMPANY MANUFACTURING MOBILE PHONES HAVE ASKED THEIR PRODUCTION MANAGER
TO ACHIEVE TO TARGET OF 150 MOBILES PER DAY. THE PRODUCTION MANAGER HAS ASKED HIS FOREMEN TO ACHIEVE HIS
TARGET BUT HE DID NOT GIVE HIM THE AUTHORITY OF USING THE MATERIAL FROM STORE DEPARTMENT .THE FOREMEN
COULD NOT ACHIEVE THE TARGET. IDENTIFY AND EXPLAIN THE PRINCIPLE OF MANAGEMENT, WHICH IS VIOLATED BY THE
COMPANY.
Q6 MR.RAM, THE MARKETING MANAGER OF A PEN MANUFACTURING COMPANY DEVELOPED A PLAN

FOR MEETING THE INCREASED DEMAND WITHOUT INVITING HIS SUBORDINATES SUGGESTIONS AND
IDEAS. THE SUBORDINATES WERE SIMULTANEOUSLY TAKING INSTRUCTIONS FROM MANY SUPERIORS
WHICH LED TO DECLINE IN EFFICIENCY AND MORALE OF SUBORDINATES.
IDENTIFY AND EXPLAIN THE TWO PRINCIPLES OF FAYOL VIOLATED HERE.
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UNIT 3
BUSINESS ENVIRONMENT
MEANING:
It is the sum total of all individuals or institutions comprising of

consumers, competitors, suppliers government, courts, media and also the forces like economic, social,
political, legal and technological that are outside the ambit
and control of business enterprise but that which can affect its performance.
features of business environment:
I. Constitutes totally of external forces it comprises of the sum total of

all forces that are external to the business firm which it must deal with.
II. Ii. Specific and general forces the forces present outside can be divided into two parts.
specific‐ these forces affect the firms of an industry

separately.E.g. Customers, suppliers, competitive firms et general ‐ these forces affect all the firms of an
industry equally e.g. Social, political.
Iii ‘ interrelated-the different factors are co‐relateded. Ex-

change in the import‐ export policy is a political change that gives rise to economic change as well.
iv- uncertainty -business environment are suspectible to rapid changes, no

one can predict with certainty the changes in the e.g. Change in technology and fashion.
v. Dynamic -business environment keeps on changing.
Vi. Complex -it is difficult to know the extent of impact of the changes that the factors can bring in.
Vii. Relative -business environment is a relative concept as it differs from

country to country, region to region.
Importance of business environment
I. Identify the opportunities and getting the first mover advantage - by being aware of the
changes in business environment, enterprises can identify opportunity
and strategize ways to capitalise on them.
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II. identify threats and early warning signals - environment scanning helps in
detecting possible threats in future.
III. basis for planning and policy for formulation -identification of threats and opportunity
serves as basis for deciding the future course of action.
IV. tapping useful resources - the resources are required to carry on a successful business
enterprise. These have to be procured from the business environment.
V. Helps in coping with rapid changes -turbulent markets, less brand loyalty,
divisions and sub‐divisions (fragmentation) of markets, more demanding customers, rapid
changes in technology and intense global competition
combined with complex business environment calls for a flexible planning to
cope with the changes.
VI. improvement in organisation performance - continuous and constantmonitoring and
adapting suitable business practices result in improved business performance.
4. Dimensions of business environment
Economic environment : refers to all those forces that have economic impact on the business
activity components of economic environment are gdp, inflation rate, interest rate,
rupee value, stock exchange index, tax rate.
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Political environment: includes political conditions such as political leadership,
political stability, practices of the ruling party and the nature of the government in power
and their level of interference.
Components of political environment are constitution of the country, political

ideology of the ruling party, nature and extent of government interference, international relations.
Legal environment: refers to the framework of laws and various legislations within
which the business activities take place
components of legal environment are government legislations, court judgements,
decisions of various commissions.
Socialenvironment: represents the customs and traditions, values, culture, social

trends, beliefs, norms and ethics of a society in which business enterprises operate.
Components of social environment are customs traditions, social expectations,
lifestyles, values, literacy level.
Technological environment: refers to the influence of the changes in the technology on

the business environment. Components of technological environment: new methods and
techniques of business operations, scientific improvements and innovations,
as part of economic reforms the government of india announced new industrial olicy
in july 1991 which emphasised on three major elements which were:
• liberalisation from the clutches of licensing policy. Therefore, removal of

entry and growth restrictions on the private sector enterprises.
• globalisation encouragement of foreign private participation in industrial development.

This step mainly intended at integrating the national economy with
the world economy through the removal of barriers on international trade and capital movements.
• privatisation drastic reduction in the role of public sector. Further it aimed at

transfer of ownership ,management and control of the public sector enterprise to the private sector.
The new industrial policy aimed at creating a more competent environment in the
economy so as to strengthen the process of industrialisation. Its features are as follows
• delicensing of all projects except six industries
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• decreased role of public sector to merely 4 industries
• disinvestment: selling of a part or whole of the shares of the public sector undertaking
• liberalisation of foreign capital
• setting up of foreign investment board (fipb)
• liberal policy for technical collaborations
7. Impact of government policy changes on business and industry:
• increase in competition
• demanding customers
• technical change and increased investment in r and d
• necessity of change
• development of human resource
• market orientation
• loss of budgetary support to the public sector.
CASE STUDIES
Q1.YOGA GURU,BABA RAMDEV HAS PLANS TO START A WORLD-CLASS UNIVERSITY IN INDIA IN THE NEXT FIVE YEARS TO
EDUCATE AROUND ONE LAKH STUDENTS IN DIFFERENT STREAMS. A 1,500-ACRE LAND HAS ALREADY BEEN ACQUIRED FOR
IT.
HE HAS PLANNED TO BUILD A WORLD CLASS UNIVERSITY NEAR NEW DELHI AKIN TO THE UNIVERSITY OF HOUSTON. THE
COST OF THE PROJECT WOULD BE AROUND RS.25,000 CRORE. BABA RAMDEV HAS ALSO REQUESTED PRIME MINISTER
NARENDRA MODI AND MINISTRY OF HUMAN RESOURCES DEVELOPMENT TO START A VEDIC EDUCATION BOARD AT STATE
AND NATIONAL LEVEL TO REVIVE AND PROMOTE THE INDIAN GURUKUL, TRADITION OF EDUCATION. HE STARTED THAT HE
PLANS TO DONATE 100PER CENT OF ALL PROFIT FROM THE SALE OF HERBAL AND FOOD PRODUCTS OF HIS PATANJALI
AYURVEDA FOR CHARITABLE CAUSES AND AT LEAST 80 PER CENT TOWARDS EDUCATION.
(A)WHICH ADVANTAGE OF UNDERSTANDING BUSINESS ENVIRONMENT WILL BABA RAMDEV BANK UPON BY ESTABLISHING
WORLD CLASS UNIVERSITY WITH GURUKUL-TYPE CULTURE IN INDIA?
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(B)IN CASE PM NARENDRA MODI AND MINISTRY OF HRD ESTABLISH VEDIC EDUCATION BOARD AT STATE AND NATIONAL
LEVEL ,THEN THERE WILL BE A REMARKABLE CHANGE IN THE EDUCATION SYSTEM OF THE COUNTRY. THIS IMPLIES CHANGE
IN ONE OF THE DIMENSION OF THE BUSINESS ENVIRONMENT. IDENTIFY THE DIMENSION.
(C)STATE ANY TWO MORE ELEMENTS OF THE DIMENSION IDENTIFIED IN PART (B).
Q2. IDENTIFY THE TYPE OF DIMENSIONS OF ENVIRONMENT TO THE FOLLOWING ARE RELATED
(A)BANKS REDUCES THE INTEREST RATE ON HOUSE LOAN.
(B)NO. OF WORKING WOMEN IS INCREASING.
(C)RESERVATION OF TICKETS BY INTERNET.
(D)PROHIBITION OF ALCOHOL BEVERAGES TO BE ADVERTISED.
(E)WINNING OF AAM ADMI PARTY HAS BUILT UP CONFIDENCE IN ECONOMICALLY WEAKER SECTION PEOPLE.
Q3.TWO BIG BANNER MOVIES WERE SCHEDULED TO BE RELEASED ON THE SAME DATE. ON THE LAST MOVEMENT RELEASE
OF ONE OF THE MOVIES HAD TO BE POSTPONED DUE TO OPPOSITION OF THE GROUP OF PEOPLE DUE TO SOME
UNETHICAL CONTENTS RELATED TO THEIR RELIGION WAS SHOWN IN THAT MOVIE WHICH WAS POSTPONED DUE TO
OPPOSITION OF A GROUP OF PEOPLE DUE TO SOME UNETHICAL CONTENTS RELATED TO THEIR RELIGION WAS SHOWN IN
THAT MOVIE. THE OTHER MOVIE REEASED ON TIME AND MADE HUGE PROFIT AS THEIR NO COMPETITION AND MOVIE
WHICH WAS POSTPONED SUFFERED LOSS.
(A)WHICH FEATURE OF BUSINESS ENVIRONMENT IS HIGHLIGHTED HERE.
(B)IDENTIFY THE DIMENSIONS OF BUSINESS ENVIRONMENT, WHICH DELAYED THE RELEASE OF MOVIE.
Q4. AFTER WINNING THE ELECTIONS PRIME MINISTER MR. NARENDER MODI LAUNCHED A CAMPAIGN OF SWACHH
BHARAT AND INVITED VARIOUS CELEBRITIES TO BE A PART OF THIS ABHIYAAN. THIS SPREAD AWARENESS AMONG THE
PEOPLE IN SOCIETY AND IN GENERAL PEOPLE STARTED BECOMING MORE CAREFUL AND AWARE ABOUT THE CLEANLINESS
AROUND THEIR AREA. TO CONTINUE ITS IMPACT A NEW SERVICE TAX FOR SWACH BHARAT WAS ALSO STARTED. THE
GOVERNMENT IS PLANNING TO IMPORT NEW AND BETTER TECHNOLOGY TO ADOPT NEW METHODS OF TREATING THE
GARBAGE AND WASTE.
STATE THE VARIOUS DIMENSIONS OF BUSINESS ENVIRONMENT MENTIONED IN THE ABOVE PARA QUOTING THE LINES
FROM THE ABOVE PARA.
Q5. NAMAN AND GOVIND AFTER FINISHING THEIR GRADUATION UNDER VOCATIONAL STREAM DECIDED TO START THEIR
NEW OWN TRAVEL AGENCY WHICH WILL BOOK RAIL TICKETS AND AIR TICKETS ON COMMISSION BASIS . THEY ALSO
THOUGHT OF PROVIDING TICKETS WITHIN TEN MINUTES THROUGH THE USE OF INTERNET . THEY DISCUSSED THE IDES
WITH THEIR PROFESSOR MR.MEHTA WHO LIKED THE IDEA AND SUGGESTED THEM TO FIRST ANALYSE THE BUSINESS
ENVIRONMENT WHICH CONSISTS OF INVESTORS , COMPETITORS AND OTHER FORCES LIKE SOCIAL, POLITICAL ETC. THAT
MAY AFFECT THEIR BUSINESS DIRECTLY OR INDIRECTLY . HE FURTHER TOLD THEM ABOUT THE IMPROVEMENTS AND
SHIFTS IN CONSUMER PREFERENCES THAT WERE TAKING PLACE AND HENCE THEY SHOULD BE AWARE OF THE
ENVIRONMENTAL TRENDS AND CHANGES WHICH MAY HINDER THEIR BUSINESS PERFORMANCE . HE EMPHASIZED ON
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MAKING PLANS KEEPING IN MIND THE THREAT POSED BY THE COMPETITORS, SO THAT THEY CAN DEAL WITH SITUATION
EFFECTIVELY . THIS ALIGNMENT OF BUSINESS OPERATORS WITH THE BUSINESS ENVIRONMENT WILL RESULT IN BETTER
PERFORMANCE
(A)IDENTIFY AND STATE THE COMPONENT OF BUSINESS ENVIRONMENT HIGHLIGHTED IN ABOVE PARA.
(B)STATE ANY TWO FEATURES OF BUSINESS ENVIRONMENT AS DISCUSSED BY PROFESSOR MEHTA WITH NAMAN
AND GOVIND.
UNIT -4
PLANNING
It is the process of setting objectives and targets for a given time
period and formulating an action plan to achieve them effectively and efficiently.
it concerns itself with both ends and means that is what is to be done and how it is to be done.
“planning seeks to bridge the gap between where we are and where we want to go. Planning is
a trap to capture the future.
Importance of planning.
I) Provides direction by stating in advance the future course of action of what is to

be done and how it is to be done. By stating in advance it facilitates unity of direction.
II) Reduces the risk of uncertainty by predicting future events and preparing
the organization to anticipate the future and face unexpected events.
III) facilitates decision making planning helps the manager to look into the future
and make a sound judgment or choice from among the l various a ternatives.
IV) Reduces overlapping and wasteful activities‐through elimination and
minimization of useless and redundant activities facilitating clarity.
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V) Promotes innovative ideas through better new methods, ideas and procedures
to reach the objectives and goals of the enterprise. It induces the management to predict
the changes in the environment and accordingly plan the strategies for the same .
VI) Establishes standard for controlling “control is blind without planning”. It helps provide
standard against which the actual performance are compared and evaluated
o estimate the deviations.
Limitations of planning:
I. Planning does not work in a dynamic environment planning also has to work amidst the
influence of external environment which can render even the
most effective plan inoperative.
II. planning is a time consuming process as it requires collection of information, its analysis and
interpretation. It becomes a difficult exercise in times of unexpected emergencies.
III. i t involves huge cost in its formulation. As a lot of money needs to be expended
in the collection, analysis and interpretation of data
IV. I t creates rigidity in the mode of functioning. As the employees are required
to function as per the dictates of the predetermined policy.
V. It does not guarantee success, as a wrong or a misconceived plan or a well
drawn plan when not implemented can lead to failure.
VI. It reduces creativity as the middle level managers and the other decision
makers have to only follow and are not allowed to deviate from the plans.
VII. the human element can give way to errors or mistakes through wrong assumptions.
VIII. it is prone to external influences which can reduce its impact like natural
calamity, technology changes, policy changes, competition.
Steps in planning process settingupobjectives:the process begins with identifying and setting up of
objectives. It determines where to reach. The organizational objectives arrived at should
be measurable, understandable, clear and attainable.
ii. Developing planning premises premises involve making assumptions relating to

future conditions. It provides relevant facts and information relating to
future conditions. Hence sound estimates or forecast need to be made.
iii. Identifying alternative course of action : the planner now arrives at the various alternatives
for performance of a task and evaluate the probable consequence of each option.
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iv. Evaluating the alternative course the positive and negative impact of each
option in light of cost, risk and benefits is worked out.
V. Selecting the best alternative this is actually the stage of decision making where the most
suitable course of action is selected .the selected alternative is obviously the one which is
most feasible, profitable and has least negative impact.
vi. Implementing the plan : the plan is transformed into action by activating the other managerial
function involving organizing various resources and securing
cooperation and participation of other members of the organization.
vii. Follow up plan : this final culminating step involves reviewing the existing
plan for its relevance and effectiveness.
Types of plans:
SINGLE USE PLAN : PLAN MADE TO BE USED ONLY ONE TIME OR AT MOST, COUPLE OF TIMES BECAUSE THEY FOCUS ON
UNIQUE OR RARE SITUATIONS WITHIN THE ORGANISATION EG. PROGRAM, BUDGET.
STANDING PLAN : STANDING PLAN ARE OFTEN POLICIES, PROCEDURE AND PROGRAM DEVELOPED TO ENSURE THE
INERNAL OPERATION OF A GIVEN BUSINESS ARE OPERATING SMOOTHLY. THEY OTHER DEVELOPED ONCES & THEN
MODIFIED TO SUIT THE BUSINESS NEEDS REQUIREMENTS.
1. OBJECTIVE : OBJECTIVES CAN BE SAID TO BE THE DESIRED FUTURE POSITION THAT THE MANAGEMENT WOULD LIKE TO
REACH.
2. STRATEGY : A STRATEGY REFERS TO FUTURE DECISION DEFINING THE ORGANISATION S DIRECTION AND SCOPE IN THE
LONG RUN.
3. POLICY : POLICIES ARE GENERAL STATEMENTS THAT GUIDE THINKING OR CHANNELISE ENERGIES TOWARDS A
PARTICULAR DIRECTION. WE DON T SELL ON CREDIT IS THE EXAMPLE OF SALES POLICY.
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4. PROCEDURE : PROCEDURES ARE ROUTINE STEPS ON HOW TO CARRY OUT ACTIVITIES.
5. RULE : RULES ARE SPECIFIC STATEMENT THAT TELL WHAT IS TO BE DONE. FOR EXAMPLE NO SMOKING IS A RULE.
6. PROGRAMMES :- PROGRAMMES ARE THE COMBINATION OF GOALS, POLICIES AND RULES. ALL THESE PLANS TOGETHER
FORM A PROGRAMME.
7.BUDGETS : A BUDGET IS A STATEMENT OF EXPECTED RESULT EXPRESSED IN NUMERICAL TERMS FOR A DEFINITE PERIOD
OF TIME IN THE FUTURE.
8.METHOD : METHODS ARE STANDARDISED WAYS OR MANNER IN WHICH A TASK HAS TO BE PERFORMED CONSIDERING
THE OBJECTIVES.
CASE STUDIES
Q1.BHUVAN LTD. IS A GARMENT MANUFACTURING COMPANY, THE COMPANY REGULARLY SCAN BUSINESS ENVIRONMENT
AND CONSTANTLY FOR COMPANY TO FORESEE FUTURE TRENDS. COMPETITION IN THE MARKET EFFECTS THE FINANCIAL
PLAN OF THE COMPANY, SALES TARGETS HAVE TO BE REVISED WHICH IN TURN EFFECT THE CASH BUDGET.
(A)NAME AND EXPLAIN THE LIMITATION OF PLANNING HIGHLIGHTED IN THE ABOVE PARA.
(B)IDENTIFY THE TWO TYPES OF PLANS MENTIONED IN ABOVE PARA.
Q2.AN ELECTRONIC COMPANY IS FACING A PROBLEM OF DECLINING MARKET SHARE DUE TO INCREASED COMPETITION
FROM OTHER NEW AND EXISTING PLAYERS IN THE MARKET. ITS COMPETITORS ARE INTRODUCING LOWER PRICE MODELS
FOR MASS CONSUMERS. WHO ARE PRICE SENSITIVE? FOR QUALITY CONSCIOUS CONSUMERS COMPANY IS INTRODUCING
NEW MODEL WITH ADDED FEATURES AND NEW TECHNOLOGICAL ADVANCEMENTS.
(A)PREPARE A MODEL BUSINESS PLAN FOR THIS COMPANY. SPECIFY WHICH TYPE OF PLAN YOU ARE PREPARING?
Q3.ABC LTD ANNOUNCED A PLAN THAT NOBODY WOULD SMOKE IN THE ORGANIZATION PREMISES AND THEY FURTHER
ADDED THAT CERTAIN PENALTY WILL BE IMPOSED ON EMPLOYEES, OVERLOOKING THIS.
(A)NAME THE TYPE OF PLAN RELATED TO ABOVE PARA,
(B)NAME THE FEATURE OF THAT PLAN
(C)NAME THE VALUES EMPHASIZED BY THE COMPANY
Q4.IN CHAK DE INDIA MOVIE SHAHRUKH KHAN BECOMES THE COACH OF THE GIRLS HOCKEY TEAM. HE KNOWS THAT HE
HAS TO PREPARE THE GIRLS FOR THE INTERNATIONAL HOCKEY MATCHES AND WIN THE CUP. FOR THIS HE PREPARES A
LONG TERM PLAN AND THINKS OF WAYS OF HOW TO BEAT THE OPPONENT TEAM. HE COACHES THE GIRLS TO PLAY IN
DIFFERENT WAYS LIKE DEFENSIVE, OFFENSIVE ,ETC
AT THE OUTSIDE OF THE MATCH HE EXPLAINS WHO WILL OPEN THE MATCH AND HOW THE BALL WILL BE PASSED BY ONE
PLAYER TO ANOTHER STEP BY STEP.
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IDENTIFY ALL THE TYPES OF PLANS MENTIONED ABOVE. STATE THEM ALONG WITH LINES WHICH REFER TO THEM IN THE
ABOVE PARAGRAPH.
Q5.THE CEO OF XYZ LTD. AN AUTOMOBILE ENTERPRISE DREAMS OF HIS COMPANY BECOMING THE BEST PLAYER IN
FUTURE, FOR WHICH HE SETS THE OBJECTIVES, FORECASTS THE FUTURE AND DEVELOPS VARIOUS COURSES OF ACTION.
I) IDENTIFY THE MANAGEMENT FUNCTION WHICH IS HIGHLIGHTED HERE.
II) WHAT ARE THE VARIOUS VALUES THE CEO IS STRIVING TO ACHIEVE?
Q6.SUHASINI, A HOME SCIENCE GRADUATE FROM A REPUTED COLLEGE, HAS RECENTLY DONE A COOKERY COURSE. SHE
WISHED TO START HER OWN VENTURE WITH A GOAL TO PROVIDE ‘HEALTH FOOD’ AT REASONABLE PRICES. SHE DISCUSSED
HER IDEA WITH HER TEACHER (MENTOR) WHO ENCOURAGED HER. AFTER ANALYSING VARIOUS OPTIONS FOR STARTING
HER BUSINESS VENTURE, THEY SHORT LISTED THE OPTION TO SELL READY MADE AND ‘READY TO MAKE’ VEGETABLE
SHAKES AND SATTU MILK SHAKES. THEN, THEY WEIGHED THE PROS AND CONS OF BOTH THE SHORT LISTED OPTIONS.
1. NAME THE FUNCTION OF MANAGEMENT BEING DISCUSSED ABOVE AND GIVE ANY ONE OF ITS CHARACTERISTICS.
2. ALSO BRIEFLY DISCUSS ANY THREE LIMITATIONS OF THE FUNCTION DISCUSSED IN THE CASE.
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UNIT 5
ORGANISING
Organising means establishing relationship between various factors of production and it in concerned with establishing
relationship amongst jobs, sections, department & position.
Organising is the process of identifying and grouping the work to be performed, defining and delegating responsibility and
authority and establishing relationships for the purpose of enabling people to work most effectively together in
accomplishing objectives.
Step involved in the process of organising:-
1. Identification and division of work :- it involves identification and dividing the total work to be done into specific
activities (called jobs) in accordance with previously determined plans. By dividing the work the burden of work can
be shared among the employees. It facilitates specialisation of work & skills. Duplication of work can be avoided by
dividing the work into manageable activities
2. Departmentalisation :- the second step in organising is to combine or group similar or related jobs into larger units,
called departments, divisions or sections. They can be grouped on the basis of functions which an organisation
undertakes to achieve its objective. For example departments may be created for manufacturing, marketing,
financing etc. Departmentalisation is done to achieve coordination & to facilitate unity of efforts.
3. Assignment of duties :- once departments have been formed each of them is placed under the charge of an
individual called departmental head (e.g., production manager, finance manager etc.) Jobs are then allocated to the
members of each department according to their skills and qualifications.
4. establishing reporting relationships :- merely allocating work is not enough. Each individual should also know from
whom he has to take orders and to whom he is accountable. It helps in coordination amongst various departments.
Importance of organising :-
1. Benefits of specialisation : - in organising every individual is assigned a part of total work and not the whole task.
Due to this division of work into smaller units and repetitive performance leads to specialisation. Thus organising
promotes specialisation which in turn leads to efficient & speedy performance of tasks.
2. Clarity in working relationship :- it helps in creating well defined jobs and also clarifying the limits of authority
and responsibility of each job. The superior, subordinate relationship is clearly defined in organising.
3. Effective administration : it provides a clear description of jobs and related duties which helps to avoid confusion
and duplication. Clarity in working relationships enables proper execution of work which results in effective
administration.
4. Optimum utilisation of resources : the proper assignment of jobs avoids overlapping/duplication of work. This
helps in preventing confusion and minimising the wastage of resources and efforts.
5. Adaptation of change :- it allows a business enterprise to adapt itselaccording to changes in the business
environment. Organisational structures can be suitably modified according to changes itself.
6. Development of personnel : sound organisation encourages initiative & creative thinging on part of employees.
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7. Expansion and growth : it helps in growth & diversification of an enterprise by adding more job positions &
department.
Organisational structure
Functional structure :- in functional structure activities are grouped and departments are created on the basis of
specific functions to be performed. For example all the jobs related to production are grouped under production
department - sales to sales department etc.
Divisional structure -
Dividing the whole enterprise according to the major products to be manufactured (like metalplastic, cosmetics etc)
in known as divisional organisation structure.
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Difference between functional and divsional structure
TYPES OF ORGANISATION
FORMAL ORGANISATION
This structure is designed by the management to achieve organisational goals in which the responsibilities,
authority and mutual relationships among all the employees working in an enterprise are clearly defined. It can be
functional or divisional.
Features :-
1. It in deliberately created by the top management.
2. It is based on rules and procedures. Which are in written form
3. It is impersonal - does not take into consideration emotional aspect.
4. It clearly difines the authority and responsibility of every individual.
5. It is created to achieve organisationalobjectivies.
INFORMAL ORGANISATION
An informal organisation is that organisation which is not established deliberately but comes into existence because of
common interests, tastes and religious and communal relations.
Features :
1. It originates from within the formal organisation as a result of personal interaction among employees.
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2. It has no written rules and procedures.
3. It does not have fixed lines of communication.
4. It is not deliberately created by the management.
5. It is personal - means the feelings of individuals are kept in mind
DELEGATION OF AUTHORITY
Meaning - it means the granting of authority to subordinates to operate within the prescribed limits. The manager who
delegates authority holds his subordinates responsible for proper performance of the assigned tasks. To make sure that
his subordinates perform all the work effectively and efficiently in expected manner the manager creates
accountability.
Elements of delegation :-
1. Authority - the power of taking decisions in order to guide the activities of others. Authority is that power which
influences the conduct of others.
2. Responsibility : it is the obligation of a subordinate to properly perform the assigned duty. When a superior issues
orders it becomes the responsibility of the subordinate to carry it out.
3. Accountability - when a superior assigns some work to a subordinate, he is answerable to his superior for its success
or failure.
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DECENTRALISATION :-
It means to delegate authority to all levels of management for taking decisions. Under decentralisation all the authority
except the one which is absolutely necessary for the superiors to hold is given to the subordinates permanently. Under
decentralisation the number of centres for taking decisionsincreases because the managers belonging to the middle
and lower level have the authority to take important decisions.
Centralisation and decentralisation– represents the pattern of authority among managers at different levels. Centralisation
of authority means concentrations of power of decision making in a few hands. In such an organisation very little authority
is delegated to managers at middle and lower levels. No organisation can be completely centralised or decentralised. They
exist together and there in a need for a balance between the two. As the organisation grows in size there is tendency to
move towards decentralisation. Thus every organisationcharacterised by both.
CASE STUDIES
Q1.AT ALPHA LTD. ALL EXPENSES BILLS OF EMPLOYEES ARE PROCESSED BY GENERAL MANAGER HIMSELF. HE FEELS QUITE
OVERBURDEN. HE DECIDED TO DELEGATE THIS WORK TO DEPUTY GENERAL MANAGER, DISPERSES THIS AUTHORITY TO
VARIOUS RESPECTIVE DEPARTMENT SUPERVISOR.
NAME AND EXPLAIN THE CONCEPT OF MANAGEMENT HIGHLIGHTED IN ABOVE CASE BEFORE AND AFTER DELEGATING THE
AUTHORITY.
Q2. SUSHMA LTD IS ENGAGED IN THE PRODUCTION OF MARBLE ARTICLES.THE MEMBERS OF THE ORGANIZATION HAVE
FRIENDLY RELATIONSHIPS AMONG THEM. WHAT TYPE OF ORGANIZATION IS SUSHMA LTD? EXPLAIN ANY THREE BENEFITS
OF DEVELOPING SUCH AN ORGANIZATION.
Q3 SUNITA RUNS A SHOE MANUFACTURING FACTORY. AJAY OWNS A FACTORY MANUFACTURING SOLES FOR SHOES AND
SUPPLIES THE SAME TO SUNITA. THEY DECIDE TO MERGE THEIR BUSINESS AND TAKE ADVANTAGE OF ECONOMICS OF
SCALE. THEY ALSO DECIDED THAT BOTH THE UNITS WILL WORK AS TWO DIFFERENT UNITS AND START CATERING TO
NORTH AND SOUTH ZONES FOR SALES OF SHOES. IDENTIFY THE ORGANIZATIONAL STRUCTURE BEST SUITED FOR THEIR
MERGER. WHY DO YOU RECOMMEND THIS STRUCTURE?
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ALSO DISCUSS THE BENEFITS THAT THEY WILL GET BY ADOPTING THIS TYPE OF STRUCTURE.
Q4.AMAN CHADHA STARTED ‘BULLS EYE’ A COMPANY FOR PROVIDING CYBER SECURITY SOLUTIONS TO BUSINESSES. ITS
OBJECTIVE IS TO PREVENT, DETECT AND RESPOND TO CYBER ATTACKS AND PROTECT CRITICAL DATA. HE WAS A
HARDWORKING SOFTWARE ENGINEER AND AN EXPERT IN CYBER SECURITY. HIS REPUTATION GREW BY LEAPS AND
BOUNDS AS HE WAS NOT ONLY A PERSON OF INTEGRITY BUT ALSO DID HIS WORK WITH UTMOST HONESTY AND
SINCERITY. THE BUSINESS STARTED GROWING DAY BY DAY.
HE WAS DELIGHTED WHEN HE WAS OFFERED A BIG PROJECT BY THE MINISTRY OF DEFENCE. WHILE WORKING ON THE
PROJECT, HE FOUND THAT THE VOLUME OF WORK MADE IT IMPRACTICAL FOR HIM TO HANDLE ALL THE WORK BY
HIMSELF. HE DECIDED TO EXPAND THE TEAM. THE COMPANY MAINTAINED A CLOSE LIAISON WITH A LOCAL ENGINEERING
COLLEGE. DURING A CAMPUS PLACEMENT, ISHAN AND VRINDA WERE APPOINTED TO WORK FOR THE NEW PROJECT.
HE FOUND THE NEW EMPLOYEES CAPABLE, ENTHUSIASTIC AND TRUSTWORTHY. AMAN CHADHA WAS THUS, ABLE TO
FOCUS ON OBJECTIVES AND WITH THE HELP OF ISHAN AND VRINDA, THE PROJECT WAS COMPLETED ON TIME. NOT ONLY
THIS AMAN CHADHA WAS ALSO ABLE TO EXTEND HIS AREA OF OPERATIONS. ON THE OTHER HAND ISHAN AND VRINDA
ALSO GOT OPPORTUNITIES TO DEVELOP AND EXERCISE INITIATIVE.
1. IDENTIFY AND BRIEFLY EXPLAIN THE CONCEPT USED BY AMAN CHADHA IN THE ABOVE CASE WHICH HELPED HIM IN
FOCUSING ON OBJECTIVES.
2. ALSO, STATE ANY FOUR POINTS OF IMPORTANCE OF THE CONCEPT IDENTIFIED IN (I) ABOVE
Q5 “SHAN SPICES LTD.” ARE THE MANUFACTURER OF DIFFERENT FOOD SPECIFIC SPICES LIKE RAJMAA MASALA,
CHOLLEY MASALA, AALOO PARANTHA MASALA ETC. MR. RAGHAV, THE OWNER OF THE COMPANY HAS CREATED
DIFFERENT DEPARTMENTS FOR PURCHASE, PRODUCTION, MARKETING, FINANCE AND HUMAN RESOURCE. THERE ARE
THIRTY EMPLOYEES WORKING IN THE ORGANISATION. PLANNING IS OF PARAMOUNT IMPORTANCE TO THE COMPANY
AS MR. RAGHAV BELIEVES THAT EFFECTIVE PLANNING LEADS TO ACHIEVEMENT OF ORGANISATIONAL OBJECTIVES. SO
IN ORDER TO MAKE EMPLOYEES FOCUS ON OBJECTIVES, HE ISSUED INSTRUCTIONS THAT DURING WORKING HOURS
ONLY OFFICIAL MATTERS WILL BE DISCUSSED. HE MADE CERTAIN RULES AND CODE OF CONDUCT FOR THE EMPLOYEES
TO FOLLOW, ACCORDING TO WHICH EMPLOYEES ARE NOT ALLOWED TO VISIT AND TALK TO THE EMPLOYEES OF
OTHER DEPARTMENTS EXCEPT FOR OFFICIAL WORK. HE EMPHASISED ON WORK PERFORMANCE WHICH RESULTED IN
SMOOTH FUNCTIONING OF THE ORGANISATION.
Q6. KIRAN INDUSTRIES IS A COMPANY DEALING IN OFFICE FURNITURE. THE COMPANY CHOSE TO DIVERSIFY ITS
OPERATIONS TO IMPROVE ITS GROWTH POTENTIAL AND INCREASE MARKET SHARE. AS THE PROJECT WAS
IMPORTANT, MANY ALTERNATIVES WERE GENERATED FOR THE PURPOSE AND WERE THOROUGHLY DISCUSSED
AMONGST THE MEMBERS OF THE ORGANISATION. AFTER EVALUATING THE VARIOUS ALTERNATIVES, SUKHVINDER,
THE MANAGING DIRECTOR OF THE COMPANY, DECIDED THAT THEY SHOULD ADD ‘HOME INTERIORS AND
FURNISHINGS’ AS A NEW LINE OF BUSINESS ACTIVITY.
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UNIT 6
STAFFING
STAFFING MEANS PUTTING PEOPLE TO JOBS. IT BEGINS WITH HUMAN RESOURCE PLANNING AND INCLUDES DIFFERENT
OTHER FUNCTIONS LIKE RECRUITMENT, SELECTION TRAINING, DEVELOPMENT, PROMOTION AND PERFORMANCE
APPRAISAL OF WORK FORCE.
NEED AND IMPORTANCE OF STAFFING :-
1. OBTAINING COMPETENT PERSONAL : PROPER STAFFING HELPS IN DISCOVERING AND OBTAINING COMPETENT
PERSONAL FOR VARIOUS JOBS.
2. HIGHER PERFORMANCE : PROPER STAFFING ENSURES HIGHER PERFORMANCE BY PUTTING RIGHT PERSON ON THE
RIGHT JOB.
3. CONTINUOUS GROWTH : PROPER STAFFING ENSURES CONTINUOUS SURVIVAL AND GROWTH OF THE ENTERPRISE.
4. OPTIMUM UTILISATION OF HUMAN RESOURCES :- IT PREVENTS UNDER - UTILISATION OF PERSONNEL AND HIGH LABOUR
COST.
5. IMPROVES JOB SATISFACTION : IT IMPROVES JOB SATISFACTION AND MORALE OF EMPLOYEE
HUMAN RESOURCE MANAGEMENT : (HRM) THE FUNCTION OF HUMAN RESOURCE MANAGENT IS TO PROVIDE
SKILL HUMAN ELEMENTS TO THE ENTERPRISE. THEREFORE BIG ENTERPRISE CREATE A SEPARATE DEPARTMENT CALLED
HRD. THIS DEPARTMENT WORK UNDER H.R.M. MANAGERS.
DEFINITION : HUMAN RESOURCE MANAGENT IS THE RECRUITMENT SELECTION, DEVELOPMENT, UTILISATION,

COMPENSATION AND MOTIVATION OF HUMAN RESOURCES OF THE ORGANISATION. STAFFING AS PART OF HUMAN
RESOURCES MANAGEMENT : THE SCOPE OF HUMAN RESOURCES MANAGEMENT IS BIG THAN STAFFING. IT INVOLVES
STAFFING, KEEPING PERSONAL RECORD, PROVIDING EXPERT SERVICE AND OTHER WORK
Steps Involved in the Staffing Process
 Estimating the manpower requirements on the basis of workload analysis and workforce analysis.
 Recruitment is the process of searching for prospective employees and stimulating them to apply for jobs
in the organisation.
 Selection is the process of choosing from among the pool of the prospective job candidates developed at
the stage of recruitment.
 Placement and Orientation is done by giving the charge of the post to the employee for which he has been
selected. It also includes introducing him to the other employees and familiarising him with the rules and
policies of the organisation.
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 Training and development is done in order to ensure continuous learning of their employees so that they
contribute effectively and efficiently towards the realisation of the organisational goals. Training is given to
make a person job fit whereas development seeks to increase their potential for higher level jobs.
 Performance appraisal is undertaken to evaluate the worth of an employee to the organisation.
 Promotion and career planning are an integral part of people’s career and enhance their job satisfaction.
 Compensation refers to all forms of pay or rewards going to employees.
RECRUITMENT
Recruitment: Definition
Recruitment may be defined as the process of searching for prospective employees and stimulating
them to apply for jobs in the organisation.
Sources of Recruitment
1. Internal recruitment
 Promotion
 Transfer
External recruitment
 Direct Recruitment
 Casual Callers
 Advertisement
 Employment Exchange
 Placement Agencies and Management
 Consultants
 Campus Recruitment
 Recommendations of Employees
 Labour Contractors
 Advertising on Television
 Web Publishing
SELECTION
Selectiort: Definition
Selection is the process of choosing the best candidate from a pool of applicants for the job.
Important Tests Used for Selection of Employees:
 Intelligence Tests include important psychological tests used to measure the level of intelligence
quotient of an individual.
 Aptitude Test is a measure of an individual’s potential for learning new skills.
 Personality Tests give an insight into a person’s emotions, reactions, maturity and value system
etc.
 Trade Test seek to measure the existing skills of the individual.
 Interest Tests are used to know the pattern of interests or involvement of a person.
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Steps in the Process of Selection
 Preliminary Screening of the applications is done to eliminate those applicants who do not fulfill
the minimum requirements of the job.
 Selection Tests help in an objective assessment of certain characteristics of individuals and is
free from personal bias.
 Employment Interview is a face-to- face interaction between the interviewer(s) and prospective
candidate.
 Reference and Background check is carried out for the purpose of verifying information and
gaining additional information about an applicant.
 Selection Decision is made from among the candidates who pass the tests and interview.
 The selected candidates are asked to undergo a medical examination before the job offer is
made.
 Job Offer is made to those applicants who have passed all the previous tests.
 Contract of Employment is issued to the selected candidate and includes information like job
title, duties, responsibilities, date of joining, pay and allowances, etc. if the applicant accepts the
job offer.
Differences between Recruitment and Selection
S.No. Basis Recruitment Selection
Recruitment may be defined as the
process of searching for

Selection is the process of choosing the best
1. Meaning prospective employees and
candidate from a pool of applicants for the job.
stimulating them to apply for jobs in
the organisation.
2. Process It is a positive process. It is a negative process.
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3. Sequence It precedes selection. It follows recruitment.
TRAINING AND DEVELOPMENT

Training: Definition
Training is the process of increasing the knowledge and skill of the employees to perform specific jobs.
Development: Definition
Development is the process of the overall growth of a person in all aspects.
Benefits of Training to the Organization
 Training imparts systematic learning to employees thereby helping to avoid wastage of efforts and
money and is considered better than the hit and trial method.
 It increases the employees’ productivity both in terms of quantity and quality, leading to higher
profits.
 Training increases the morale of the employees and reduces absenteeism and employee turnover.
 It helps in obtaining effective response to fast changing environment – technological and
economic.
 Training equips the future manager who can take over in case of emergency.
Benefits of Training to the Employee
 Training leads to better career of the individual due to improved skills and knowledge during
training.
 It helps an individual earn more due to increased productivity.
 It makes the employee more efficient in handling machines and less prone to accidents.
 It increases the satisfaction and morale of employees.
Methods of Training:
1. Internship Training is a method for providing on the job training to the employees through a joint
programme in which educational institutions and business firms cooperate. The learners carry on
with their regular studies for the prescribed period. They also work in some factory or office to
acquire practical knowledge and skills related to their specific field of expertise.
2. Vestibule training is a popular method for providing off the job training through which the trainees
learn their jobs on the equipment they will be using at tKeir actual work place. This is usually done
when employees are required to handle sophisticated machinery and equipment.
3. Induction training is given to the new employees in order to familiarise them with the key
employees of the organisation and give information about the working of the organisation.
4. Apprenticeship training is provided to the people seeking to enter skilled jobs like plumbers,
electricians or iron workers. They are provided training under the guidance of a master worker.
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Differences between Training and Development
S.No. Basis Training Development
It is a process of increasing
1. Meaning It is a process of learning and growth.
knowledge and skills.
It is to enable the employee to do It is to enable the overall growth of the

2. Purpose
the job better. employee.
3. Scope It is a job oriented process. It is a career oriented process.
Level of It is suitable for the employees at Developmental programmes are designed for
4.
employees the lower level. middle and top level managers.
CASE STUDIES
Q1. ALPHA ENTERPRISES IS A COMPANY MANUFACTURING WATER GEYSERS. THE COMPANY HAS A FUNCTIONAL
STRUCTURE WITH FOUR MAIN FUNCTIONS-PRODUCTION, MARKETING, FINANCE AND HUMAN RESOURCE. AS THE
DEMAND FOR THE PRODUCT GREW, THE COMPANY DECIDED TO HIRE MORE EMPLOYEES.
IDENTIFY THE CONCEPT WHICH WILL HELP THE HUMAN RESOURCE MANAGER IN DECIDING THE ACTUAL NUMBER OF
PERSONS REQUIRED IN EACH DEPARTMENT.
Q2. RESOLUTIONS PVT. LTD. IS A PUBLISHING COMPANY. ITS BOOK ON BUSINESS STUDIES FOR CLASS XII IS IN GREAT
DEMAND. AS A RESULT, THE EMPLOYEES IN THE MARKETING DEPARTMENT ARE ALWAYS RACING AGAINST TIME. THE
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EMPLOYEES HAVE TO WORK OVERTIME AND ON HOLIDAYS TO CATER TO THE DEMAND.
MANAGERS IN THE MARKETING DEPARTMENT ARE UNDER STRESS AS THEY HAVE TO HANDLE MORE THAN TWO
TERRITORIES. THE WORK STRESS HAS LED TO DISSATISFACTION AMONG THE EMPLOYEES AND MANAGERS.
1. NAME AND EXPLAIN THE STEP OF STAFFING PROCESS WHICH HAS NOT BEEN PERFORMED PROPERLY.
2. STATE THE NEXT TWO STAGES IMMEDIATELY FOLLOWING THE STEP IDENTIFIED IN PART ‘A’.
Q3.JOSEPH BROS IS A FIRM MANUFACTURING JUTE LAMPSHADES. IT USES LEFTOVER JUTE PIECES FROM VARIOUS JUTE
FACTORIES TO MANUFACTURE ECONOMICAL LAMPSHADES WHICH ARE SUPPLIED TO VARIOUS HOTELS IN NEARBY TOWNS.
IT EMPLOYS MEN AND WOMEN FROM NEARBY VILLAGES AS WORKERS FOR CREATING GOOD LAMPSHADE DESIGNS.
JOSEPH BROS, IS NOT ABLE TO MEET ITS TARGETS. NAMISH, THE SUPERVISOR OF THE COMPANY, WAS TOLD TO ANALYSE
THE REASONS FOR THE POOR PERFORMANCE. NAMISH FOUND THE FOLLOWING PROBLEMS AND SUGGESTED CERTAIN
SOLUTIONS IN THE WORKING OF THE BUSINESS. THE NUMBER OF WORKERS EMPLOYED WAS LESS THAN WHAT WAS
REQUIRED FOR THE WORK. AS A RESULT, THE EXISTING WORKERS WERE OVERBURDENED. THE FIRM DECIDED TO SEARCH
FOR NEW WORKERS AND IT ASKED THE PRESENT EMPLOYEES TO INTRODUCE CANDIDATES OR RECOMMEND THEIR
FRIENDS ANDRELATIVES TO THE FIRM. THIS ENABLED THE FIRM TO ‘PUT PEOPLE TO JOBS’ AND ASSURED THE ATTAINMENT
OF OBJECTIVES ACCORDING TO PLANS.
1.IDENTIFY THE FUNCTIONS OF MANAGEMENT BEING PERFORMED BY THE FIRM IN THE ABOVE SITUATION.
2.NAME THE CONCEPT AND ITS SOURCE USED BY THE FIRM TO ATTRACT MORE WORKERS FOR THE FIRM.
Q4. AAKANSHA, NIKITA AND PARISHMA ARE THE OWNERS OF A HANDICRAFT UNIT IN THE URBAN AREA OF DIBRUGARH IN
ASSAM, WHICH IS INVOLVED IN THE MANUFACTURING AND MARKETING OF SITAL PATI, TRADITIONAL MATS AND JAPPI
(THE TRADITIONAL HEADGEAR). THEY DECIDED TO SHIFT THIS MANUFACTURING UNIT TO A RURAL AREA WITH AN
OBJECTIVE OF REDUCING THE COST AND PROVIDING JOB OPPORTUNITIES TO THE LOCALS.
THEY FOLLOWED THE FUNCTIONAL STRUCTURE IN THIS ORGANISATION WITH A VIEW TO INCREASING MANAGERIAL AND
OPERATIONAL EFFICIENCY.
THEY ASSESSED AND ANALYSED THE TYPE AND NUMBER OF EMPLOYEES REQUIRED, KEEPING IN MIND THAT THEY HAD TO
ENCOURAGE THE WOMEN AND THE PEOPLE WITH SPECIAL NEEDS BELONGING TO THE RURAL AREA.
STATE THE NEXT THREE STEPS THAT THEY WILL HAVE TO UNDERTAKE FOR OBTAINING A SATISFIED WORKFORCE FOR THEIR
HANDICRAFT UNIT
Q5.. MRS. RAJLAXMI IS WORKING AS THE HUMAN RESOURCE CONSULTANT IN A FIRM THAT MANUFACTURES COSMETICS,
WHICH IS FACING A PROBLEM OF HIGH EMPLOYEE TURNOVER. THE CEO OF THE COMPANY HAS INVITED SUGGESTION
FROM HER FOR RETAINING THE TALENTED EMPLOYEES AND REDUCING THE EMPLOYEE TURNOVER. MRS. RAJLAXMI
RECOMMENDS THAT THE GOOD EMPLOYEES BE REWARDED IN A WAY THAT IT CREATES A FEELING OF OWNERSHIP
AMONG THE EMPLOYEES AND AT THE SAME TIME, MAKES THEM CONTRIBUTE TOWARDS THE GROWTH OF THE
ORGANISATION.
IDENTIFY THE INCENTIVE AND EXPLAIN ITS TYPE WHICH HAS BEEN SUGGESTED BY MRS. RAJLAXMI TO THE CEO OF THE
COMPANY.ALSO EXPLAIN ANY TWO OTHER INCENTIVES OF THE SAME TYPE
YAJUR GOGIA
Q6. BLUE HEAVENS LTD. PURCHASED A NEW MACHINERY FROM GERMANY FOR MANUFACTURING SOME AUTO
COMPONENTS. IT WAS A COST-EFFECTIVE AND QUALITY PRODUCTION MACHINE BUT DURING THE PRODUCTION PROCESS,
MANAGER OBSERVED THAT THE QUALITY OF THE PRODUCTION WAS NOT AS PER STANDARDS. ON INVESTIGATION, IT WAS
FOUND THAT THERE WAS LACK OF KNOWLEDGE OF USING THESE HI-TECH MACHINES. SO, FREQUENT VISITS BY ENGINEERS
WERE REQUIRED FROM GERMANY BUT THIS RESULTED IN HIGH OVERHEAD CHARGES.
SUGGEST WHAT CAN BE DONE TO DEVELOP THE SKILLS AND ABILITIES OF EMPLOYEES FOR PRODUCING QUALITY
PRODUCTS BY USING THESE HI-TECH MACHINES. ALSO STATE HOW THE EMPLOYEES OR THE ORGANISATION WILL BE
BENEFITED BY YOUR SUGGESTION.
UNIT 7
DIRECTING
DIRECTING
Directing: Definition
Directing refers to the process of instructing, guiding, counselling, motivating and leading people in the
organisation for the purpose of achieving organisational goals.
Importance of Directing
 Directing helps to initiate action by people in the organisation towards attainment of desired
objectives.
 Directing integrates employees’ efforts in the organisation in such a way that it contributes to the
organisational performance.
 Directing guides employees to fully realise their potential through effective communication,
motivation and leadership.
 Directing facilitates introduction of needed changes in the organisation as it helps to reduce
employees’ resistance and develop an environment which is conducive to introducing changes in
the organisation.
 Effective directing helps to bring stability and balance in the organisation since it encourages
cooperation and commitment.
Features of Directing
 Directing initiates action in the organisation as it is an executive function of management.

 Directing takes place at every level of management wherever superior – subordinate relations
exist.
 Directing is a continuous process and is carried on till an organisation ceases to exist.
 Directing flows from top to bottom as it is first initiated at top level and flows to the bottom through
organisational hierarchy.
Elements of Directing
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 Supervision
 Motivation
 Leadership
 Communication
SUPERVISION
Supervision: Definition
Supervision is the process of overseeing the work of a subordinate by his superior.
Importance of Supervision
 A good supervisor acts as a guide, friend and philosopher to the workers.

 Supervisor acts as a link between workers and management.
 Supervisor plays a crucial role in maintaining group unity among workers placed under his control.
 Supervisor ensures performance of work according to the targets set and motivates the workers
effectively.
 Supervisor provides good on-the-job training to the workers and employees.
 A supervisor with good leadership qualities can build up high morale among workers.
 A good supervisor analyses the work performed and gives feedback to the workers.
MOTIVATION
Motivation: Definition
Motivation is the process of stimulating people to action to accomplish desired goals.
Importance of Motivation
 Motivation helps to improve the performance of both the employees as well as the organisation.
 Motivation helps to mould negative or indifferent attitudes of employees into positive attitudes for
the benefit of theorganisation.
 Motivation helps to reduce the employee turnover and leads to reduction in the cost to be incurred
on new recruitment and training.
 Motivation helps managers to introduce changes within the organisation smoothly without much
resistance from their subordinates.
 Motivation helps to reduce absenteeism in the organisation as work becomes a source of pleasure
and workers attend to the work regularly.
Features of Motivation
 Motivation is an internal feeling as it relates to the urge, drives, desires, or needs of human beings.
 Motivation produces goal directed behaviour.
 Motivation can be either positive or negative.
 Motivation is a comolexnrocess as the individuals may differ in their perceptions and reactions.
expectations,
YAJUR GOGIA
Motivation Process-
Abraham Maslow’s Need Hierarchy Theory of Motivation
 Basic Physiological Needs refer to the needs that are most basic in the hierarchy like hunger,
thirst, shelter etc. which can be fulfilled by basic salary.
 Safety/Security Needs refer to the needs to get security and protection from physical and
emotional harm which can be fulfilled through job security, stability of income, pension plans etc.
 Affiliation/Belonging Needs refer to the needs that relate to affection, sense of belongingness,
acceptance and friendship which can be fulfilled through team work, kindness etc.
 Esteem Needs include factors such as self-respect, autonomy status, recognition and attention
which can be fulfilled by giving praise and recognition, offering promotions etc.
 Self-Actualisation Needs refer to the drive to become what one is capable of becoming which
can be fulfilled by providing challenging work and giving them flexibility and autonomy in their jobs
.
INCENTIVES
Incentive: Definition
Incentive means all measures which are used to motivate people to improve performance.
Types of Financial Incentives
 Pay and allowances

 Productivity linked wage incentives
 Bonus
 Profit Sharing
 Co-partnership/ Stock option
 Retirement Benefits
 Perquisites
Types of Incentives
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 Financial incentives refers to incentives which are in direct monetary form.
 Non-financial incentives mainly focus on psychological, social and emotional needs.
Types of Non-financial Incentives
 Status
 Organisational Climate
 Career Advancement Opportunity
 Job Enrichment
 Employee Recognition programmes
 Job security
 Employee participation
 Employee Empowerment
LEADERSHIP
Leadership: Definition
Leadership is the process of influencing the behaviour of people by making them strive voluntarily
towards achievement of organisational goals.
Importance of Leadership
 It helps to bring about a positive change in the behaviour of the employees for the benefit Of the
organisation.
 It helps to maintain good personal relations and also helps the followers in fulfilling their needs.
 It helps to introduce the required changes in the organisation smoothly.
 It helps to resolve the conflicts within the organisation effectively without leading to any disruptions
in working of the organisation.
 It facilitates training of subordinates by the leader.
Features of Leadership
 Leadership shows the ability of an individual to influence others.

 Leadership seeks to bring about a desired change in the behaviour of others.
 Leadership reflects the interpersonal relations between leaders and followers.
 Leadership is an effective tool to achieve common goals of the drganisation.
 Leadership is a continuous process.
Styles of Leadership
 Autocratic leadership
 Democratic leadership
 Laissez-faire
COMMUNICATION
Communication: Definition
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Communication is defined as a process of exchange of ideas, views, facts, feelings etc., between or
among people to create common understanding.
Importance of Communication
 Acts as basis of coordination among departments, activities and persons in the organisation
 Helps in smooth working of an enterprise as all organisational interactions depend on
communications.
 Acts as basis of decision making as it provides the information needed for decision making.
 Increases managerial efficiency as it lubricates the entire organisation and keeps the
organisation at work with efficiency.
 Promotes cooperation and industrial peace as the two way communication promotes
cooperation and mutual understanding between the management and workers.
 Effective communication helps to establish effective leadership.
 Boosts morale and provides motivation to the employees and managers to achieve higher
goals.
Elements Involved in Communication Process
 Sender refers to a person who conveys his thoughts or ideas to the receiver.
 Message is the content of ideas, feelings, suggestions, order etc., intended to be communicated.
 Encoding refers to the process of converting the message into communication symbols such as
words, pictures, gestures etc.,
 Media is the path through which encoded message is transmitted to receiver through a face to
face interaction, phone call, internet
 Decoding is the process of converting encoded symbols of the sender.
 Receiver refers to the person who receives communication of the sender.
 Feedback includes all those actions of receiver indicating that he has received and understood
message of sender.
 Noise means some obstruction to communication.
BARRIERS TO COMMUNICATION IN THE ORGANISATIONS

Semantic Barriers
 Badly expressed massage

 Symbols with different meanings
 Faulty translations
 Unclarified assumptions
 Technical jargon
 Body language and gesture decoding
Organisational Barriers
 Organisational policy
 Rules and regulations
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 Status
 Complexity in organisation structure
 Organisational facilities
Psychological Barriers
 Premature evaluation
 Lack of attention
 Loss by transmission and poor retention
 Distrust
Personal Barriers
 Fear of challenge to authority

 Lack of confidence of superior on his subordinates
 Unwillingness to communicate
 Lack of proper incentives
Ways of Improving Communication Effectiveness
 Clarifying the ideas before communication

 Communicate according to the needs of receiver
 Consult others before communicating
 Be aware of languages, tone and content of message
 Convey things of help and value to listeners
 Ensure proper feedback
 Follow up communications
 Be a good listener
CASE STUDIES
Q1. UMANG GUPTA IS THE MANAGING DIRECTOR OF DENVER LTD. THE COMPANY HAD ESTABLISHED A GOOD NAME FOR
ITSELF AND HAD BEEN DOING WELL. IT WAS KNOWN FOR TIMELY COMPLETION OF ORDERS. THE PRODUCTION MANAGER,
MS. KANTA WAS EFFICIENTLY HANDLING THE PROCESSING OF ORDER AND HAD A TEAM OF FOURTEEN MOTIVATED
EMPLOYEES WORKING UNDER HER. EVERYTHING WAS GOING ON WELL. UNFORTUNATELY SHE MET WITH AN ACCIDENT.
UMANG KNEW THAT IN THE ABSENCE OF MS. KANTA, THE COMPANY MAY NOT BE ABLE TO MEET THE DEADLINES. HE
ALSO KNEW THAT NOT MEETING THE DEADLINES MAY LEAD TO CUSTOMER DISSATISFACTION WITH THE RISK OF LOSS OF
BUSINESS AND GOODWILL. SO, HE HAD A MEETING WITH HIS EMPLOYEES IN WHICH ACCURATE THE SPEEDY PROCESSING
OF ORDERS WAS PLANNED. EVERYBODY AGREED TO WORK AS TEAM BECAUSE THE BEHAVIOUR OF UMANG GUPTA WAS
POSITIVE TOWARDS THE EMPLOYEES OF THE ORGANISATION. HENCE EVERYONE PUT IN EXTRA TIME AND EFFORTS AND
THE TARGETS WERE MET ON TIME.
NOT ONLY THIS, UMANG VISITED MS. KANTA AND ADVISED HER TO TAKE SUFFICIENT REST.
YAJUR GOGIA
1. IDENTIFY THE LEADERSHIP STYLE OF UMANG GUPTA AND DRAW A DIAGRAM DEPICTING THE STYLE.
2. STATE ANY TWO VALUES HIGHLIGHTED BY THE BEHAVIOUR OF UMANG GUPTA
Q2. M/S BETA LTD. DEALS IN CONSUMER GOODS. IT EMPLOYS 100 WORKERS AND 10 OPERATIVE MANAGERS WHO GIVE
GUIDANCE AND SUPPORT TO THE WORKERS WHILE OPERATING THE MACHINERY. THE COMPANY HAS A POLICY OF
GRANTING LEAVE AS PER THE REQUIREMENT OF THE WORKERS. WORKERS 3 H 3 ARE GENERALLY GRANTED LEAVE ON
FESTIVALS AND SPECIAL OCCASIONS. RECENTLY ON PUJA FESTIVAL, IT RECEIVED A BIG ORDER. WORKERS ARE KEEN TO
TAKE PUJA HOLIDAYS WHILE MANAGEMENT IS PRESSING HARD FOR OVERTIME. THIS MATTER WAS PLACED BEFORE THE
PERSONNEL MANAGER WHO CALLED THE MEETING OF OPERATIVE MANAGERS AND WORKERS TO INFORM THEM ABOUT
THE CHANGES IN THE INCENTIVE PLAN WHICH STATES PAYMENT OF DOUBLE WAGES FOR WORKING OVERTIME AND
TRIPLE WAGES FOR WORKING ON HOLIDAYS. WORKERS WITHOUT ANY PRESSURE VOLUNTARILY TOOK LIMITED HOLIDAYS
AND WERE ABLE TO INCREASE THEIR EARNING BY WORKING OVERTIME AND ON HOLIDAYS. DURING BOARD OF DIRECTORS
MEETING, PERSONNEL MANAGER WAS ASKED TO UPDATE THE MANAGEMENT FOR ACHIEVING HIGHER OUTPUT, MEETING
TIMELY SUPPLIES WITHOUT ANY CONFRONTATION WITH WORKERS. PERSONNEL MANAGER REPLIED, “I JUST USED A
CARROT WITH NO STICKS APPROACH”.
BY QUOTING THE LINES FROM ABOVE PARAGRAPH STATE ANY TWO ELEMENTS OF DIRECTING.
Q3.PRATEEK IS WORKING IN A MULTINATIONAL COMPANY IN NOIDA. HE WAS RUNNING A TEMPERATURE FOR THE LAST
MANY DAYS. WHEN HIS BLOOD WAS TESTED, HE WAS FOUND TO BE POSITIVE FOR MALARIA. HE WAS ADMITTED IN A
HOSPITAL AND A BLOOD TRANSFUSION WAS ADVISED BY THE DOCTORS AS HIS CONDITION WAS VERY SERIOUS. ONE OF
HIS COLLEAGUES SENT A TEXT MESSAGE TO HIS SUPERIOR, MR. B. CHATTERJEE. MR. B. CHATTERJEE IMMEDIATELY SENT A
TEXT MESSAGE TO THE EMPLOYEES OF THE ORGANISATION REQUESTING THEM TO DONATE BLOOD FOR PRATEEK. WHEN
THE GENERAL MANAGER CAME TO KNOW ABOUT IT, HE ORDERED FOR FUMIGATION IN THE COMPANY PREMISES AND
CLEANING THE SURROUNDINGS.
1. FROM THE ABOVE PARAGRAPH, QUOTE LINES THAT INDICATE FORMAL AND INFORMAL COMMUNICATION.
2. STATE ANY TWO FEATURES OF INFORMAL COMMUNICATION.
3. IDENTIFY ANY TWO VALUES THAT ARE BEING COMMUNICATED TO SOCIETY IN THE ABOVE CASE
Q4. MR. SHUBHENDU BOSE IS THE OWNER OF BIKMAC ENTERPRISES CARRYING ON THE BUSINESS OF MANUFACTURING
VARIOUS KINDS OF BISCUITS. THERE WAS A LOT OF DISCONTENTMENT IN THE ORGANISATION AND THE TARGETS WERE
NOT BEING MET. HE ASKED HIS SON, NAVAL, WHO HAD RECENTLY COMPLETED HIS MBA, TO FIND OUT THE REASON.
NAVAL FOUND THAT ALL THE DECISION-MAKING OF THE ENTERPRISE WERE IN THE HANDS OF HIS FATHER. HIS FATHER
DIDN’T BELIEVE IN HIS EMPLOYEES. AS A RESULT, BOTH THE EMPLOYER AND THE EMPLOYEES WERE NOT ABLE TO
UNDERSTAND EACH OTHERS’ MESSAGES IN THE SAME SENSE. THUS, THE EMPLOYEES WERE NOT HAPPY AND TARGETS
WERE NOT MET.
1. IDENTIFY ANY TWO COMMUNICATION BARRIERS BECAUSE OF WHICH BIKMAC ENTERPRISES WAS NOT ABLE TO
ACHIEVE ITS TARGET.
2. STATE ONE MORE BARRIER EACH OF THE TYPES IDENTIFIED IN (1) ABOVE.
Q5. MR. FERNANDES IS THE OWNER OF UNIBIE ENTERPRISES, CARRYING ON THE BUSINESS OF
MANUFACTUR¬ING ELECTRICAL APPLIANCES. THERE IS A LOT OF DISCONTENTMENT IN THE ORGANISATION AND
TARGETS ARE NOT BEING MET. HE ASKED HIS SON, MICHEL, WHO HAS RECENTLY COMPLETED HIS MBA TO FIND
OUT THE REASON.
MICHEL FOUND THAT ALL THE DECISION-MAKING OF THE ENTERPRISE WERE IN THE HANDS OF HIS FATHER.
YAJUR GOGIA
MOREOVER, HIS FATHER DID NOT HAVE CONFIDENCE IN THE COMPETENCY OF THE EMPLOYEES. THUS, THE
EMPLOYEES WERE NOT HAPPY.
1. IDENTIFY ANY TWO COMMUNICATION BARRIERS BECAUSE OF WHICH UNIBIE ENTERPRISE WAS NOT ABLE
TO ACHIEVE ITS TARGET.
2. STATE ONE MORE BARRIER EACH OF THE TYPES IDENTIFIED IN PART (1) ABOVE.
Q6.SAMITA HAD BEEN WORKING AS AN ASSISTANT MANAGER WITH JOHNSON ENTERPRISES FOR THE LAST TEN
YEARS. SHE WAS VERY POPULAR AMONGST HER COLLEAGUES BECAUSE OF HER COMMITMENT AND DEDICATION
TOWARDS WORK. WHEN THE MANAGER SENIOR TO HER RETIRED, ALL HER COLLEAGUES THOUGHT THAT NOW
SAMITA WOULD BE PROMOTED. BUT TO EVERYONE’S SURPRISE, THE VACANT POST WAS FILLED BY AN OUTSIDER,
MRS. RITA. SAMITA FELT DEMORALISED AND HER PERFORMANCE STARTED DECLINING. SHE WOULD ABSENT
HERSELF OFTEN AND COULD NOT MEET HER TARGETS.
MRS. RITA WAS A GOOD LEADER WHO WOULD NOT ONLY INSTRUCT HER SUBORDINATES BUT WOULD ALSO GUIDE
AND INSPIRE THEM. SHE NOTICES SAMITA’S BEHAVIOUR AND FELT THAT HER PERFORMANCE COULD BE IMPROVED.
SHE STARTED INVOLVING SAMITA IN THE DECISION-MAKING ISSUES RELATED TO THE ORGANISATION AND MADE
HER A PART OF A HIGH LEVEL JOINT-MANAGEMENT COMMITTEE. SAMITA WAS NOW PUNCTUAL IN OFFICE AND HER
PERFORMANCE STARTED IMPROVING.
1. IDENTIFY THE FUNCTION OF MANAGEMENT BEING PERFORMED BY MRS. RITA.

2. NAME THE ELEMENT OF THE ABOVE FUNCTION OF MANAGEMENT WHICH HELPED RITA IMPROVE SAMITA’S
BEHAVIOUR.
3. STATE ANY THREE FEATURES OF THE ELEMENT IDENTIFIED IN (2) ABOVE.
Q7.JAIDEEP RECENTLY JOINED AS THE MANAGING DIRECTOR OF TIVORI LTD., AN APPAREL DESIGNING COMPANY. HE
OBSERVED THAT THE COMPANY HAD A NUMBER OF EXPERIENCED FASHION DESIGNERS ON ITS PAYROLL. THEY REGULARLY
OFFERED USEFUL SUGGESTIONS WHICH WERE NEITHER APPRECIATED NOR REWARDED BY THE COMPANY. INSTEAD, THE
COMPANY OUTSOURCED ITS SERVICES TO SOME RENOWNED FASHION DESIGNERS AND PAID THEM A GOOD
COMPENSATION FOR THEIR SERVICES. BECAUSE OF THIS, THE EMPLOYEES FELT DISHEARTENED AND STOPPED GIVING
USEFUL SUGGESTIONS.
1. IDENTIFY THE COMMUNICATION BARRIER DISCUSSED ABOVE.

2. STATE THE CATEGORY OF THIS COMMUNICATION BARRIER.
3. EXPLAIN ANY OTHER COMMUNICATION BARRIERS OF THE SAME CATEGORY
YAJUR GOGIA
UNIT 8
CONTROLLING
CONTROLLING
Controlling: Definition
Controlling means ensuring that activities in an organisation are performed as per the plans.
Importance of Controlling
 It helps in accomplishing organisational goals by constantly monitoring the performance of the

employees and bringing to light the deviations, if any, and taking appropriate corrective action.
 It helps the business managers to judge the objectivity and accuracy of the standards.
 It seeks to make efficient use of resources.
 It seeks to motivate the employees and helps them in giving a better performance.
 It creates an atmosphere of order and discipline in the organisation.
 It facilitates coordination in action by providing direction to all activities within and among
departments.
Features of Controlling
 It is a goal-oriented function.
 It is a pervasive function as it is used in the organisations of varying types and sizes.
 It is considered to be a forward looking function as it helps to improve the planning by providing
valuable feedback for reviewing and revising the standards.
 It is considered to be a backward looking function as it is like the post mortem of the past activities
to ascertain the deviations if any.
 It is not the last function of management as it brings the management cycle back to the planning
function.
Steps Involved in the Controlling Process
 Setting performance standards in clear, specific and measurable terms.

 Measurement of actual performance as far as possible in the same units in which standards are
set.
 Comparing actual performance with standards to identify deviations if any.
 Analysing deviations through critical point control and management by exception approaches to
identify the causes for their occurrence.
 Taking corrective action whenever the deviation occurs beyond the permissible limits so that it
does not reoccur in future.
Relationship between Planning and Controlling
YAJUR GOGIA
 Planning without controlling is useless and controlling without planning is blind.
 Planning provides the basis of controlling by setting the standards in advance. In the absence of
these standards, managers will not know what all activities have to be controlled.
 Planning is prescriptive in nature whereas, controlling is evaluative.
 Thus, planning and controlling are interrelated and interdependent. As planning is based on facts,
it makes controlling easier and effective whereas controlling helps to improve future planning by
providing valuable information derived from the past experiences.
CASE STUDIES
Q1. MR. NATH, A RECENTLY APPOINTED PRODUCTION MANAGER OF SUNTECH LTD., HAS DECIDED TO PRODUCE JUTE BAGS
INSTEAD OF PLASTIC BAGS AS THESE ARE BANNED BY THE GOVERNMENT. HE SET A TARGET OF PRODUCING 1000 JUTE
BAGS A DAY. IT WAS REPORTED THAT THE EMPLOYEES WERE NOT ABLE TO ACHIEVE THE TARGET. AFTER ANALYSIS, HE
FOUND THAT EMPLOYEES WERE DEMOTIVATED AND NOT PUTTING IN THEIR BEST FOR ACHIEVING THE TARGET. MR.
NATH’S BEHAVIOUR IS GOOD TOWARDS THE EMPLOYEES. HIS ATTITUDE IS ALWAYS POSITIVE. SO, HE ANNOUNCED
VARIOUS INCENTIVE SCHEMES FOR THE EMPLOYEES LIKE:
1. INSTALLING AWARDS OR CERTIFICATES FOR BEST PERFORMANCE

2. REWARDING AN EMPLOYEE FOR GIVING VALUABLE SUGGESTIONS
3. CONGRATULATING THE EMPLOYEES FOR GOOD PERFORMANCE
 IDENTIFY THE FUNCTIONS OF MANAGEMENT HIGHLIGHTED IN THE ABOVE PARAGRAPH.
 STATE THE INCENTIVE UNDER WHICH THE EMPLOYEE ARE MOTIVATED.
 STATE ANY TWO VALUES WHICH THE PRODUCTION MANAGER WANTS TO COMMUNICATE TO SOCIETY BY HIS
WORK AND BEHAVIOUR.
Q2. ‘AS LTD.’ IS A LARGE COMPANY ENGAGED IN ASSEMBLING OF AIR-CONDITIONERS. RECENTLY THE COMPANY HAD
CONDUCTED THE ‘TIME’ AND ‘MOTION’ STUDY AND CONCLUDED THAT ON AN AVERAGE, A WORKER CAN ASSEMBLE TEN
AIR-CONDITIONERS IN A DAY. THE TARGET VOLUME OF THE COMPANY IN A DAY IS ASSEMBLING OF 1,000 UNITS OF AIR-
YAJUR GOGIA
CONDITIONERS. THE COMPANY IS PROVIDING ATTRACTIVE ALLOWANCES TO REDUCE LABOUR TURNOVER AND
ABSENTEEISM. ALL THE WORKERS ARE HAPPY. EVEN THEN THE ASSEMBLING OF AIR-CONDITIONERS PER DAY IS 800 UNITS
ONLY. TO FIND OUT THE REASON, THE COMPANY COMPARED ACTUAL PERFORMANCE OF EACH WORKER AND OBSERVED
THROUGH CCTV THAT SOME OF THE WORKERS WERE BUSY IN GOSSIPING.
1. IDENTIFY THE FUNCTION OF MANAGEMENT DISCUSSED ABOVE.

2. STATE THE STEPS IN THE PROCESS OF THE FUNCTION IDENTIFIED WHICH ARE DISCUSSED IN THE ABOVE
PARAGRAPH.
Q3. RAJEEV AND SANJEEV ARE MANAGERS IN THE SAME ORGANISATION HEADING DIFFERENT UNITS. WHILE
DISCUSSING ABOUT THE FUNCTIONS OF MANAGEMENT, RAJEEV SAYS THAT ‘PLANNING IS LOOKING AHEAD WHEREAS
CONTROLLING IS LOOKING BACK.’ BUT SANJEEV SAYS, ‘YOU ARE WRONG BECAUSE PLANNING IS LOOKING BACK
WHEREAS CONTROLLING IS LOOKING AHEAD.’ BOTH ARE GIVING REASONS IN FAVOUR OF THEIR STATEMENTS. EXPLAIN
THE POSSIBLE REASONS GIVEN BY BOTH AND JUSTIFY WHO IS CORRECT.
Q4. KAPIL & CO. IS A LARGE MANUFACTURING UNIT. RECENTLY THE COMPANY HAD CONDUCTED TIME AND MOTION
STUDIES AND CONCLUDED THAT ON AN AVERAGE, A WORKER COULD PRODUCE 300 UNITS PER DAY. HOWEVER, IT HAS
BEEN NOTICED THAT THE AVERAGE DAILY PRODUCTION PER WORKER IS IN THE RANGE OF 200-225 UNITS.
1. NAME THE FUNCTION OF MANAGEMENT AND IDENTIFY THE STEPS IN THE PROCESS OF THIS FUNCTION WHICH
HELPED IN FINDING OUT THAT THE ACTUAL PRODUCTION OF A WORKER IS LESS THAN THE SET TARGET.
2. TO COMPLETE THE PROCESS OF THE FUNCTION IDENTIFIED IN (1) AND TO ENSURE THE PERFORMANCE AS PER TIME
AND MOTION STUDIES, EXPLAIN WHAT FURTHER STEPS A MANAGER HAS TO TAKE?
Q5. K&K CO. LTD. IS ENGAGED IN MANUFACTURING OF MACHINE COMPONENTS. THE TARGET OF PRODUCTION IS 200
UNITS DAILY. THE COMPANY HAD BEEN SUCCESSFULLY ATTAINING THIS TARGET UNTIL TWO MONTHS AGO. OVER THE
LAST TWO MONTHS IT HAS BEEN OBSERVED THAT DAILY PRODUCTION VARIES BETWEEN 150-170 UNITS. IDENTIFY THE
POSSIBLE CAUSES FOR THE DECLINE IN PRODUCTION AND THE STEPS TO BE TAKEN TO ACHIEVE THE DESIRE TARGETS.
Q6. TASTE BUDS LTD.’ IS A COMPANY KNOWN FOR MANUFACTURING GOOD QUALITY CONFECTIONERY PRODUCTS. THE
AUTOMATED SYSTEM OF PRODUCTION ENSURES UNIFORMITY IN PRODUCTION AND QUALITY MAINTENANCE. THE
QUALITY ASSURANCE TEAM CONDUCTS STRINGENT CHECKS AT ALL STAGES, RECORDS AND ANALYSES THE DEVIATIONS
AND TAKES THE NECESSARY CORRECTIVE ACTIONS RIGHT FROM THE PROCUREMENT OF RAW MATERIAL TO ITS
PROCESSING, PRODUCTION AND PACKAGING. THE COMPANY HAS A WELL-EQUIPPED IN¬HOUSE QUALITY INSPECTION CELL
WHERE CONFECTIONERY PRODUCTS ARE TESTED ON VARIOUS PARAMETERS OF QUALITY BY THE TEAM OF EXPERIENCED
QUALITY STAFF.
IN CONTEXT OF THE ABOVE CASE:
1. IDENTIFY AND EXPLAIN THE FUNCTION OF MANAGEMENT BEING PERFORMED BY THE QUALITY ASSURANCE TEAM
OF ‘TASTE BUDS LTD.’
2. EXPLAIN THE STATEMENT, “RECORDS AND ANALYSES THE DEVIATIONS AND TAKES THE NECESSARY CORRECTIVE
ACTIONS”.
YAJUR GOGIA
YAJUR GOGIA
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UNIT-1

NATURE AND SIGNIFICANCE OF MANAGEMENT

EFFICIENCY AND EFFECTIVENESS

(3) CREATES DYNAMIC ORGANISATION : MANAGEMENT HELPS IN CREATING DYNAMIC ORGANISATION

(4) ACHIEVING PERSONAL OBJECTIVES : MANAGEMENT HELPS IN ACHIEVING OBJECTIVES OF

(5) DEVELOPMENT OF SOCIETY : MANAGEMENT HELPS IN THE DEVELOPMENT OF SOCIETY BY

The features of art are as follows.

• MIDDLE LEVEL MANAGEMENT

 Planning is deciding in advance what to do in future and how to do it.

COORDINATION : THE ESSENCE OF MANAGEMENT :

 It integrates the group efforts.

(A)WHICH FEATURE OF MANAGEMENT IS HIGHLIGHTED HERE?

(B)WHICH LEVEL OF MANAGEMENT WILL TAKE THIS DECISION?

(A)WHICH FEATURE OF MANAGEMENT IS HIGHLIGHTED HERE.

(B)WHICH LEVEL OF MANAGEMENT WILL TAKE THIS DECISION .

(C)STATE ANY TWO DESIGNATION OF THE LEVEL OF MANAGEMENT IDENTIFIED IN (B)ABOVE.

(A)WHICH ASPECT OF MANAGEMENT IS BEING PERFORMED BY MOTU?

(B)DISCUSS THE SIGNIFICANCE OF CONCEPT IDENTIFIED IN PAR (A).

3.Significance/ importance of management

Fayol’s principles of management

2. Authority and responsibility there must be a right balance between

3. Discipline obedience to organisation rules and employment agreement.

6. Subordination of individual interest to general interest the organisation intere st to

8. Centralisation and decentralisation there should be a proper balance

9. Scalar chain orders or communication should pass from top to bottom

1. Science not rule of thumb

3. Cooperation not individualism taylor emphasised on the importance of cooperative group

Techniques of scientific management-F.W. TAYLOR

Taylor v/s Fayol

(A)IDENTIFY THE PRINCIPLE OF MANAGEMENT IGNORED BY SHREE ENTERPRISES.

Q6 MR.RAM, THE MARKETING MANAGER OF A PEN MANUFACTURING COMPANY DEVELOPED A PLAN

IDENTIFY AND EXPLAIN THE TWO PRINCIPLES OF FAYOL VIOLATED HERE.

It is the sum total of all individuals or institutions comprising of

features of business environment:

I. Constitutes totally of external forces it comprises of the sum total of

specific‐ these forces affect the firms of an industry

Iii ‘ interrelated-the different factors are co‐relateded. Ex-

iv- uncertainty -business environment are suspectible to rapid changes, no

v. Dynamic -business environment keeps on changing.

Vii. Relative -business environment is a relative concept as it differs from

Importance of business environment

4. Dimensions of business environment

Components of political environment are constitution of the country, political

Socialenvironment: represents the customs and traditions, values, culture, social

Technological environment: refers to the influence of the changes in the technology on

• liberalisation from the clutches of licensing policy. Therefore, removal of

• globalisation encouragement of foreign private participation in industrial development.

• privatisation drastic reduction in the role of public sector. Further it aimed at

• delicensing of all projects except six industries

• liberalisation of foreign capital

• setting up of foreign investment board (fipb)

• liberal policy for technical collaborations

7. Impact of government policy changes on business and industry:

• technical change and increased investment in r and d

• development of human resource

• loss of budgetary support to the public sector.

(A)BANKS REDUCES THE INTEREST RATE ON HOUSE LOAN.

(B)NO. OF WORKING WOMEN IS INCREASING.