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All questions of Organising for Commerce Exam

___________ cannot be entirely delegated
  • a)
    Responsibility
  • b)
    Accountability
  • c)
    Authority
  • d)
    None of these
Correct answer is option 'A'. Can you explain this answer?

Rajat Patel answered
Authority can be delegated but responsibility can never be delegated. Responsibility of subordinates is “performance” and that of managers is “responsibility for the action of their subordinates”. One cannot be held responsible for a task if he has only limited authority.
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___________ is helpful in reducing the burden of the manager
  • a)
    Decentralisation
  • b)
    Centralisation
  • c)
    Delegation
  • d)
    None of these
Correct answer is option 'C'. Can you explain this answer?

Arun Yadav answered
In the process of delegation, the managers are allowed to share their responsibilities and work with the subordinates which help the managers to reduce their work load. With the process of delegation, the managers can pass all their routine work to the subordinates and concentrate on important work. Without delegation, managers will be overburdened with the work.

Freedom to take own decision is _____________
  • a)
    Delegation
  • b)
    Decentralisation
  • c)
    Centralisation
  • d)
    None of these
Correct answer is option 'B'. Can you explain this answer?

Aryan Khanna answered
Decentralisation is the spread of power from central to local branches. Main authorities gave some power to their subordinates so that the subordinates are also able to take decisions on their own for the firm.In short they have freedom to take decisions.

Authority, Responsibility and Accountability are the elements of ______________
  • a) 
    Decentralisation
  • b) 
    Informal Organisation
  • c) 
    Delegation
  • d) 
    None of these
Correct answer is option 'C'. Can you explain this answer?

Kavita Joshi answered
Delegation is the assignment of any responsibility or authority to another person to carry out specific activities. It is one of the core concepts of management leadership. However, the person who delegated the work remains accountable for the outcome of the delegated work.

A tall structure has a
  • a)
    Narrow span of management
  • b)
    Wide span of management
  • c)
    No span of management
  • d)
    Less levels of management
Correct answer is option 'A'. Can you explain this answer?

A tall structure of organisation is the one that has multiple levels of hierarchy. A tall structure of organisation has narrow span of management. That is, under such a structure a manager has charge of only a few subordinates.

Which of the following does not follow the scalar chain?
  • a)
    Divisional structure
  • b)
    Informal Organisation
  • c)
    Formal organisation
  • d)
    Functional structure
Correct answer is option 'B'. Can you explain this answer?

Aryan Khanna answered
Scalar chain is one of the principle given by halenry fayol.This principle says that communication would be done in a chain way means in a formal and disciplined way. So,under informal organization there is not the maintainance of any formal rules.So,scalar chain is not followed under informal organization.

This a MCQ (Multiple Choice Question) based practice test of Chapter 5 - Organising of Business Studies of Class XII (12) for the quick revision/preparation of School Board examinations
Q  Which of the following is not an element of delegation?
  • a)
    Authority
  • b)
    Responsibility
  • c)
    Accountability
  • d)
    Informal organization
Correct answer is 'D'. Can you explain this answer?

Vikas Kapoor answered
Informal Organisation is not an element of delegation. Delegation means designating or transferring of authority to subordinates or another person. For example assigning work by a manager to a subordinate to execute certain activities. It is the most important concept of management leadership.

Right of an individual to command his subordinates is ______________
  • a)
    Accountability
  • b)
    None of these
  • c)
    Responsibility
  • d)
    Authority
Correct answer is option 'D'. Can you explain this answer?

Poonam Reddy answered
Authority is the right or power assigned to an executive or a manager in order to achieve certain organizational objectives.
It indicates the right and power of making decisions, giving orders and instructions to subordinates. Authority is delegated from above but must be accepted from below i.e. by the subordinates. In other words, authority flows downwards.

Meaning of authority is__________________
  • a)
    None of these
  • b)
    Right to avoid taxes
  • c)
    Right to Command
  • d)
    Subordinate to Superior relationship
Correct answer is option 'C'. Can you explain this answer?

Jayant Mishra answered
Authority refers to:
1. The authorization, permission, power, or right to act on another’s behalf and to bind them by such actions. See also agency, agent, and principal.
2. The right or power to command, govern, or enforce obedience.

Nature of informal organisation is _______________________
  • a)
    Mandatory
  • b)
    Rigid
  • c)
    Flexible
  • d)
    None of these
Correct answer is option 'C'. Can you explain this answer?

Aryan Khanna answered
Informal organization are opposite of formal organization. They represent non-planned, unofficial, social interactions amongst people working in formal structures. They arise out of common interests of people.

Span of management refers to
  • a)
    Number of managers
  • b)
    Number of subordinates under a superior
  • c)
    Length of term for which a manager is appointed
  • d)
    Number of members in top management
Correct answer is option 'B'. Can you explain this answer?

Hanna Raishna answered
The span of management ,to a large extent gives shape to the organisational structure. Span of management refers to the number of subordinates that can be effectively managed by a superior.
Therefore the right answer to this question is option 'B'.

For delegation to be effective it is essential that responsibility be accompanied with necessary
  • a)
    Manpower
  • b)
    Incentives
  • c)
    Promotions
  • d)
    Authority
Correct answer is option 'D'. Can you explain this answer?

Poonam Reddy answered
The elements of delegation are as follows:1. Authority It refers to the right of an individual to command his subordinates and to take action within 

Grouping of activities on the basis of functions is a part of
  • a)
    Decentralised organisation
  • b)
    Centralised organisation
  • c)
    Functional organisation
  • d)
    Divisional organisation
Correct answer is option 'C'. Can you explain this answer?

Kavita Joshi answered
Functional Organisation involves grouping of the functions of similar nature. Each group forms a separate department that report to one head. For example, departments may be divided on the basis of functions such as production, human resources, etc. that report to the managing director of the organisation.

A network of social relationship that arises spontaneously due to interaction at work is called:
  • a)
    Informal organisation
  • b)
    Formal organisation
  • c)
    Delegation
  • d)
    Decentralisation
Correct answer is option 'A'. Can you explain this answer?

Informal organisation structure individual are assigned various job positions. Informal organisation structure is the network of social relationships that arises in spontaneously due to the interaction of work. Informal organisation structure is spontaneously in interaction of work in various job positions is called informal organisation structure.

What is the first step in organising process?
  • a) 
    Establishing reporting relationship
  • b) 
    Assignment of duties
  • c) 
    Departmentalisation
  • d) 
    Identification and division of work
Correct answer is option 'D'. Can you explain this answer?

Arun Khanna answered
The process of organizing consists of following steps!1. Identification and Division of work:The organising function begins with the division of total work into smaller units. Each unit of total work is 

The form of organisation known for giving rise to rumors is called
  • a)
    Centralised organisation
  • b)
    Formal organization
  • c)
    Decentralised organisation
  • d)
    Informal organisation
Correct answer is option 'D'. Can you explain this answer?

Rumours are a result of informal organisation. They can have adverse effect on the working environment. It may result in arguments or conflicts among the people of the organisation. For example, a rumour about the boss may pop up during a communication among a group of employees, which may affect the superior-subordinate relationship.

Properly perform the assigned duty, is ___________
  • a) 
    Accountability
  • b) 
    Responsibility
  • c) 
    Authority
  • d) 
    None of these
Correct answer is option 'B'. Can you explain this answer?

Nandini Iyer answered
In philosophy, moral responsibility is the status of morally deserving praise, blame, reward, or punishment for an act or omission, in accordance with one's moral obligations. Deciding what counts as "morally obligatory" is a principal concern of ethics.

Which of the following is arises from delegation of authority?
  • a)
    Authority
  • b)
    Responsibility
  • c)
    Accountability
  • d)
    None of these
Correct answer is option 'B'. Can you explain this answer?

Pranavi Das answered
Delegation of authority in an organization leads to the transfer of power to make decisions and take actions from a higher-level position to a lower-level position. This transfer of power leads to the emergence of responsibility for the delegated tasks.

Responsibility as a Result of Delegation of Authority:

When authority is delegated, corresponding responsibility emerges. The person or department to whom the authority is delegated becomes responsible for the task or decision they are accountable for. This means that the individual or department must ensure that the task is carried out efficiently, effectively, and in a timely manner. They are answerable for their actions to their superior, and failure to carry out the task appropriately can lead to negative consequences.

Importance of Responsibility in Delegation of Authority:

Responsibility is an essential component of delegation of authority because it ensures that the delegated task is completed effectively and efficiently. It also helps to maintain a clear chain of command in the organization, as each person is responsible for the tasks delegated to them.

Conclusion:

In conclusion, delegation of authority leads to the emergence of responsibility, which is essential for the effective functioning of an organization. Responsibility ensures that the delegated tasks are completed efficiently, and it helps to maintain a clear chain of command in the organization.

Formal organisation is directed by __________
  • a)
    Rules
  • b)
    Human Behaviour
  • c)
    Policies
  • d)
    None of these
Correct answer is option 'A'. Can you explain this answer?

Alok Mehta answered
The formal organisation structure concentrates on the jobs to be performed. It, therefore, makes everybody responsible for a given task. A formal organisation is bound by rules, regulations and procedures. It thus ensures law and order in the organisation. The organisation structure enables the people of the organisation to work together for accomplishing the common objectives of the enterprise

It flows downwards, superior to subordinate __
  • a)
    Accountability
  • b)
    Responsibility
  • c)
    Authority
  • d)
    None of these
Correct answer is option 'C'. Can you explain this answer?

Authority as a Superior-Subordinate Relationship

Definition of Authority:
Authority refers to the power or right to give orders, make decisions, and enforce obedience. It is a formal power vested in individuals or organizations to make decisions, direct others, and take action.

Superior-Subordinate Relationship:
Authority is a superior-subordinate relationship where the superior has the power to direct and control the actions and decisions of the subordinate. The superior possesses the ability to make decisions and the power to enforce them, while the subordinate has the obligation to follow the orders and directions of the superior.

Flow of Authority:
The flow of authority is from top to bottom. The superior is at the top of the hierarchy and has the ultimate authority, while the subordinate is at the bottom of the hierarchy and has limited authority. The authority flows down the hierarchy, and the subordinate is accountable to the superior for their actions and decisions.

Significance of Authority:
Authority is essential for the smooth functioning of organizations. It ensures that the decisions are made at the right level, and the work is carried out efficiently and effectively. It helps to maintain discipline, establish order, and promote coordination and cooperation among the members of the organization.

Therefore, the correct answer is option 'C' - Authority.

Which of the following is arises from the responsibility?
  • a)
    Responsibility
  • b)
    Accountability
  • c)
    Authority
  • d)
    None of these
Correct answer is option 'B'. Can you explain this answer?

Poonam Reddy answered
Being accountable means being ultimately answerable for your actions. You’ll only be accountable when there is a responsibility given to you. So, we can say accountability arises from responsibility.

What is the last step in organising process?
  • a)
    Identification and division of work
  • b)
    Departmentalisation
  • c)
    Assignment of duties
  • d)
    Establishing reporting relationship
Correct answer is option 'D'. Can you explain this answer?

Aryan Khanna answered
Establishing reporting relationship is the final step as in the end all the reports are submitted and charts and manuals are prepared for better and efficient running of the organization.

Product Specialisation is concerned with_____________
  • a)
    Functional Structure
  • b)
    Divisional Structure
  • c)
    Normal Structure
  • d)
    None of these
Correct answer is option 'B'. Can you explain this answer?

Yes generally product specialisation is concerned with divisional structure....eg henry Ford's assembling line method which made a revolution in car industry.... By this method assembling car by dividing assembling car as small divisional structure.. ....

Read the following text and answer the questions given below:
Bimal, the owner of 'Reliable Constructions' decided to begin a campaign in order to create awareness among the residents for creating a clean and safe environment. In an effort to develop clean surroundings in the area, he formed a team of 20 members to list the different ways that can be adopted for keeping the area clean. Different people had different suggestions, someone suggested to take the help of local residents including young children, one suggestion was to involve unemployed youth. The idea to take the help of volunteers was also given. A combination of the most effective strategies after evaluating all options was selected for implementation. To achieve the desired goals and objectives, various activities were identified like:
(i) Purchase of essential items like dustbins, garbage bags, brooms, phenyl, etc.
(ii) Door-to-door collection of garbage.
(iii) Recycling of garbage.
(iv) Disposal of garbage, etc.
Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort. After identification and grouping of these activities, the work was allocated among the different members.
Q. "After identification of different activities the work was allocated to different members." Which step does this represent in the process of organizing?
  • a)
    Identification and division of work
  • b)
    Departmentalisation
  • c)
    Assignment of duties
  • d)
    Establishing reporting relationships
Correct answer is option 'C'. Can you explain this answer?

Naina Sharma answered
Assignment of Duties: The work is assigned according to the ability of individuals. Employees are assigned duties by giving them a document called job description. This document clearly defines the contents and responsibilities related to the job.

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Identification and division of work is the first step in the process of organising.
Reason (R): Organising involves identifying and dividing the work that has to be done in accordance with previously determined plans.
  • a)
    Both (A) and (R) are true, and (R) is the correct explanation of (A).
  • b)
    Both (A) and (R) are true, but (R) is not the correct explanation of (A).
  • c)
    (A) is true, but (R) is false.
  • d)
    (A) is false, but (R) is true.
Correct answer is option 'A'. Can you explain this answer?

Gowri Chavan answered
Assertion (A): Identification and division of work is the first step in the process of organizing.
Reason (R): Organizing involves identifying and dividing the work that has to be done in accordance with previously determined plans.

Explanation:
Identification and division of work:
- Identification and division of work is an essential step in the process of organizing.
- It involves breaking down the tasks and responsibilities into smaller, manageable units.
- This helps in defining clear roles and responsibilities for each individual or department.

Organizing:
- Organizing is the process of arranging and allocating resources to achieve specific goals.
- It involves determining the activities and tasks that need to be performed, assigning them to individuals or groups, and establishing the relationships and coordination required for successful completion.

Alignment with previously determined plans:
- Organizing is done in accordance with previously determined plans, such as strategic plans, operational plans, or project plans.
- These plans provide the framework and direction for the organization, and organizing ensures that the work is aligned with these plans.

Relationship between Assertion and Reason:
- The Reason provided in the statement supports the Assertion.
- Identification and division of work is indeed the first step in the process of organizing.
- Organizing involves breaking down the work and assigning it to individuals or groups, which aligns with the process of identifying and dividing work.

Correct answer:
- The correct answer is option 'A' - Both (A) and (R) are true, and (R) is the correct explanation of (A).

Conclusion:
- Identification and division of work is crucial in the organizing process.
- It helps in assigning tasks and responsibilities, and ensures alignment with previously determined plans.
- This step sets the foundation for successful organizing and achieving organizational goals.

Read the following text and answer the questions given below:
Alpha Tonics is a progressive company which has achieved new records in the field of medicines. Recently the company decided to go for a major shift in policy decision by handing over the decision making authority to the lower most level of employees. For this the company went for a thorough planning. Within four months the positive results of this major policy decision was recognizable. The employees felt a lot of development in their skill of taking first step to manage things on their own. Some major newspapers also covered this development. The production of the company increased. The company's top management could now focus on new areas of innovation as the employees turned more reliable.
One day it so happened that the company's manufacturing branch in south could not fulfill even half of its production target and the operations manager was held answerable for the assigned target. He was called in the office. When he was questioned it was found that his right to command the workers was insufficient and it should have been more to create results. The management decided to listen to him and he was given more power. When he went to the shop floor he told the workers that the standard of behaviour of the workers should come from the official rules and procedures.
Q. Which concept of management has been related to in the first paragraph of the case?
  • a)
    Delegation
  • b)
    Decentralisation
  • c)
    Both (A) and (B)
  • d)
    None of the above
Correct answer is option 'B'. Can you explain this answer?

Kiran Mehta answered
Decentralisation explains the manner in which decision making responsibilities are divided among hierarchical levels. Decentralisation refers to delegation of authority throughout all the levels of the organisation.

Under Accountability a person is answerable for the ___________
  • a)
    Final outcome of the assigned task
  • b)
    Delegation of Authority
  • c)
    Growth of comapny
  • d)
    None of these
Correct answer is option 'A'. Can you explain this answer?

Aditya Sen answered
Explanation:
Under accountability, a person is answerable for the final outcome of the assigned task. This means that the person is responsible for the results of the task and will be held accountable for any success or failure. There are several reasons why accountability is important in a business context:

Ensures responsibility: Accountability ensures that each person is responsible for their actions and decisions. This helps to promote a culture of responsibility and ownership in the workplace.

Encourages transparency: When people are held accountable, they are more likely to be transparent about their actions and decisions. This helps to promote trust and open communication in the workplace.

Promotes learning: When people are held accountable for their actions and decisions, they are more likely to learn from their mistakes and improve their performance in the future.

Boosts productivity: Accountability helps to ensure that people are working towards a common goal and are focused on achieving results. This can help to boost productivity and improve overall performance.

In conclusion, accountability is an important aspect of business that helps to promote responsibility, transparency, learning, and productivity. By holding people accountable for their actions and decisions, businesses can create a culture of excellence and achieve success.

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Responsibility arises from a superior subordinate relationship.
Reason (R): The subordinate is bound to perform the duty assigned to him by his superior.
  • a)
    Both (A) and (R) are true, and (R) is the correct explanation of (A).
  • b)
    Both (A) and (R) are true, but (R) is not the correct explanation of (A).
  • c)
    (A) is true, but (R) is false.
  • d)
    (A) is false, but (R) is true.
Correct answer is option 'A'. Can you explain this answer?

Rhea Choudhary answered
The correct answer is option 'A': Both (A) and (R) are true, and (R) is the correct explanation of (A).

Explanation:
Assertion (A): Responsibility arises from a superior subordinate relationship.
Reason (R): The subordinate is bound to perform the duty assigned to him by his superior.

Explanation of Assertion (A)
Responsibility refers to the obligation or duty to perform a task or fulfill a role. In a superior-subordinate relationship, the superior has the authority to assign tasks and delegate responsibilities to the subordinate. This relationship establishes a chain of command where the superior has the power to direct and control the actions of the subordinate. Therefore, responsibility arises from this hierarchical relationship, as the subordinate is accountable for carrying out the tasks assigned by their superior.

Explanation of Reason (R)
The reason states that the subordinate is bound to perform the duty assigned to him by his superior. This means that the subordinate has a legal and moral obligation to fulfill the tasks and responsibilities assigned to them by their superior. The concept of authority and obedience is inherent in a superior-subordinate relationship. The superior has the right to expect the subordinate to follow their instructions and complete the assigned tasks within the specified time frame. The subordinate's compliance is necessary for the smooth functioning of the organization and the accomplishment of its objectives.

Explanation of the Correct Answer
The correct answer is option 'A' because both the assertion and the reason are true, and the reason correctly explains the assertion. The superior-subordinate relationship establishes a foundation for responsibility, as the subordinate is obligated to perform the duties assigned to them by their superior. The reason provides the explanation for why responsibility arises from this relationship, emphasizing the subordinate's duty to comply with their superior's instructions. Thus, option 'A' is the correct choice.

Read the following text and answer the questions given below:
Alpha Tonics is a progressive company which has achieved new records in the field of medicines. Recently the company decided to go for a major shift in policy decision by handing over the decision making authority to the lower most level of employees. For this the company went for a thorough planning. Within four months the positive results of this major policy decision was recognizable. The employees felt a lot of development in their skill of taking first step to manage things on their own. Some major newspapers also covered this development. The production of the company increased. The company's top management could now focus on new areas of innovation as the employees turned more reliable.
One day it so happened that the company's manufacturing branch in south could not fulfill even half of its production target and the operations manager was held answerable for the assigned target. He was called in the office. When he was questioned it was found that his right to command the workers was insufficient and it should have been more to create results. The management decided to listen to him and he was given more power. When he went to the shop floor he told the workers that the standard of behaviour of the workers should come from the official rules and procedures.
Q. Which elements of delegation have been highlighted in the second paragraph of the case?
  • a)
    Accountability
  • b)
    Authority
  • c)
    Both (A) and (B)
  • d)
    None of the above
Correct answer is option 'C'. Can you explain this answer?

Kiran Mehta answered
Authority refers to the right of an individual to command his subordinates and to take action within the scope of his position. The concept of authority arises from the established scalar chain which links the various job positions and levels of an organisation. Accountability implies being answerable for the final outcome. Once authority has been delegated and responsibility accepted, one cannot deny accountability.

Read the following text and answer the questions given below:
Alpha Tonics is a progressive company which has achieved new records in the field of medicines. Recently the company decided to go for a major shift in policy decision by handing over the decision making authority to the lower most level of employees. For this the company went for a thorough planning. Within four months the positive results of this major policy decision was recognizable. The employees felt a lot of development in their skill of taking first step to manage things on their own. Some major newspapers also covered this development. The production of the company increased. The company's top management could now focus on new areas of innovation as the employees turned more reliable.
One day it so happened that the company's manufacturing branch in south could not fulfill even half of its production target and the operations manager was held answerable for the assigned target. He was called in the office. When he was questioned it was found that his right to command the workers was insufficient and it should have been more to create results. The management decided to listen to him and he was given more power. When he went to the shop floor he told the workers that the standard of behaviour of the workers should come from the official rules and procedures.
Q. Which of the following advantages of decentralization have been highlighted in the above case?
  • a)
    It helps in development of initiative among subordinates.
  • b)
    It helps in developing managerial talent for the future.
  • c)
    Both (A) and (B)
  • d)
    None of the above
Correct answer is option 'C'. Can you explain this answer?

  • Motivation of Subordinates Decentralization improves the level of job satisfaction as well as employee morale, especially amongst the lower level managers. Furthermore, it strives to satisfy the varying requirements for participation, independence, and status. Decentralization also promotes a spirit of group cohesiveness and spirit.
  • Future talent management is driven by the changes in the nature of work, the work environment and the needs of employers. Talent management will move away from generic approach and instead speak to individuals as people. Organizations should take a more pro-active rather than reactive role.

Grouping of activities on the basis of product lines is a part of
  • a)
    Delegated organisation
  • b)
    Functional organisation
  • c)
    Autonomous organization
  • d)
    Divisional organisation
Correct answer is option 'D'. Can you explain this answer?

Rajat Patel answered
Sometimes an organisation has more than one product line. Under such a scenario the organisation groups the activities on the basis of the product line. Such a grouping of activities on the basis of product line is known as divisional organisation. Each division further has its own sub-departments such as production, finance, etc.

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Organising provides a clear description of jobs and related duties.
Reason (R): Organising stimulates creativity amongst the managers.
  • a)
    Both (A) and (R) are true, and (R) is the correct explanation of (A).
  • b)
    Both (A) and (R) are true, but (R) is not the correct explanation of (A).
  • c)
    (A) is true, but (R) is false.
  • d)
    (A) is false, but (R) is true.
Correct answer is option 'B'. Can you explain this answer?

Assertion and Reasoning in Organising

Assertion (A): Organising provides a clear description of jobs and related duties.

Reason (R): Organising stimulates creativity amongst the managers.

To determine the correct choice between the given options, let's analyze the statements and their interrelation.

Explanation:

Organising provides a clear description of jobs and related duties:
- Organising is a key function of management that involves arranging and structuring resources to achieve organizational goals effectively.
- It includes tasks such as defining job roles, responsibilities, and reporting relationships.
- By organizing, managers establish clear job descriptions and delineate the responsibilities and tasks associated with each job.
- This clarity helps in avoiding confusion and overlapping of roles, ensuring that each employee knows their duties and the scope of their work.
- Thus, Assertion (A) is true.

Organising stimulates creativity amongst the managers:
- Reasoning (R) suggests that organising stimulates creativity amongst managers.
- Organising primarily focuses on establishing a formal structure and division of labor within an organization.
- While it provides clarity and structure, it may not necessarily directly stimulate creativity.
- Creativity is more closely associated with other management functions such as innovation, problem-solving, and decision-making.
- Although organizing can indirectly support creativity by providing a clear framework and reducing administrative burdens, it does not directly stimulate creativity.
- Thus, Reason (R) is not the correct explanation of Assertion (A).

Conclusion:
Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A). Therefore, the correct choice is option 'B'.

Read the following text and answer the questions given below:
Alpha Tonics is a progressive company which has achieved new records in the field of medicines. Recently the company decided to go for a major shift in policy decision by handing over the decision making authority to the lower most level of employees. For this the company went for a thorough planning. Within four months the positive results of this major policy decision was recognizable. The employees felt a lot of development in their skill of taking first step to manage things on their own. Some major newspapers also covered this development. The production of the company increased. The company's top management could now focus on new areas of innovation as the employees turned more reliable.
One day it so happened that the company's manufacturing branch in south could not fulfill even half of its production target and the operations manager was held answerable for the assigned target. He was called in the office. When he was questioned it was found that his right to command the workers was insufficient and it should have been more to create results. The management decided to listen to him and he was given more power. When he went to the shop floor he told the workers that the standard of behaviour of the workers should come from the official rules and procedures.
Q. Which feature of the informal organisation has been opposed by the operations manager in the above case?
  • a)
    The standards of behaviour originate from the group norms.
  • b)
    Independent channels of communication without specified direction of flow of information are developed by group members.
  • c)
    It emerges spontaneously and is not deliberately created by the management.
  • d)
    None of the above.
Correct answer is option 'A'. Can you explain this answer?

Vikas Kapoor answered
Group norms are ground rules that can encourage a group to work efficiently and discourage behaviors that hinder its effectiveness. Although unwritten, they govern how group members interact with each other, work as a team, make decisions, and even how they dress.

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Functional structure makes training of employees easier as the focus is only on a limited range of skills.
Reason (R): Divisional heads are accountable for profits.
  • a)
    Both (A) and (R) are true, and (R) is the correct explanation of (A).
  • b)
    Both (A) and (R) are true, but (R) is not the correct explanation of (A).
  • c)
    (A) is true, but (R) is false.
  • d)
    (A) is false, but (R) is true.
Correct answer is option 'B'. Can you explain this answer?

Akshay Shah answered
Assertion (A): Functional structure makes training of employees easier as the focus is only on a limited range of skills.

Reason (R): Divisional heads are accountable for profits.

The correct answer is option 'B': Both (A) and (R) are true, but (R) is not the correct explanation of (A).

Explanation:

Functional Structure and Employee Training:
- Functional structure is an organizational structure where employees are grouped based on their specialization or function, such as marketing, finance, operations, etc.
- In a functional structure, employees within each department or function have similar skills and expertise.
- This makes training of employees easier as the focus is only on a limited range of skills.
- Training programs can be designed specifically for each function, addressing the specific needs and requirements of that function.
- The training can be more targeted and efficient as the trainers can focus on enhancing the skills and knowledge relevant to a particular function.

Divisional Heads and Accountability for Profits:
- Divisional heads are responsible for managing and overseeing a specific division or business unit within an organization.
- Their primary objective is to ensure the profitability and success of their division.
- Divisional heads are accountable for the financial performance of their division, including generating profits and achieving financial targets.
- They are responsible for making strategic decisions, managing resources, and implementing plans to maximize profits and minimize costs.
- The divisional heads are evaluated based on the financial performance and profitability of their division.

Explanation of the Correct Answer:
- Both Assertion (A) and Reason (R) are true.
- Functional structure does make training of employees easier as the focus is only on a limited range of skills.
- However, the Reason (R) provided, i.e., "Divisional heads are accountable for profits," is not the correct explanation of Assertion (A).
- The accountability of divisional heads for profits is not directly related to the ease of employee training in a functional structure.
- The accountability for profits is a separate aspect of divisional heads' responsibilities and does not necessarily impact the training process.
- Therefore, option 'B' is the correct answer as both statements are true, but the reason does not explain the assertion.

Centralisation refers to
  • a)
    Opening new centers or branches
  • b)
    Retention of decision making authority
  • c)
    Dispersal of decision making authority
  • d)
    Creating divisions as profit centers
Correct answer is option 'B'. Can you explain this answer?

Centralisation refers to the retention of decision making authority. Centralisation implies a situation where the decision making power is retained by the top level management. Under such a system, other levels of management do not have a right to intervene in policy making. The power and the authority, in such a system, remains concentrated in a few hands.

Organisation establishes relationship between
  • a)
    People, work and resources
  • b)
    Customer, work and resources
  • c)
    People, work and management
  • d)
    Customer, work and management
Correct answer is option 'A'. Can you explain this answer?

Establishing Relationship Between People, Work, and Resources

Organizations are established to achieve specific goals and objectives. For this purpose, they bring together people, work, and resources to create value for their customers. In this context, establishing a relationship between people, work, and resources is essential for the success of any organization.

People:

People are the most valuable asset of an organization. They bring skills, knowledge, and experience to the workplace, which are essential for the organization's success. Establishing a relationship with people involves creating a work environment that supports their growth, development, and well-being. This includes providing training and development opportunities, recognizing and rewarding their contributions, and promoting a culture of respect and inclusion.

Work:

Work refers to the tasks and activities that people perform to achieve organizational goals. Establishing a relationship with work involves ensuring that the work is meaningful, challenging, and aligned with the organization's objectives. This includes setting clear expectations, providing the necessary resources and support, and promoting a culture of continuous improvement.

Resources:

Resources refer to the physical, financial, and technological assets that organizations use to support their operations. Establishing a relationship with resources involves ensuring that they are used effectively and efficiently to achieve organizational goals. This includes developing and implementing processes and procedures to manage resources, monitoring their use and performance, and making adjustments as needed.

Conclusion:

Establishing a relationship between people, work, and resources is essential for the success of any organization. By creating a work environment that supports people's growth, providing meaningful and challenging work, and using resources effectively, organizations can create value for their customers and achieve their goals and objectives.

Read the following text and answer the questions given below:
'Pappu Sweets Makers' is a sweets making company which has turnover in crores. In order to manage the work in the organisation, the departments have been created on the basis of functions.
Examine the following situations of this organisation and give answers accordingly:
Situation 1: It is expected that employees who are performing similar tasks work under the same department. So the company now has HR, Marketing and Finance departments. The division is based on specific functions.
Situation 2: There are similarities in the tasks performed within the same department.
Situation 3: The profit is increasing month by month due to the success of this structure of the organisation.
Situation 4: There has been minimum duplication of efforts as the same department is taking care of single function.
Q. Why do you think the profit is increasing as given in Situation 3?
  • a)
    Due to product specialisation
  • b)
    Due to managerial and operational efficiency
  • c)
    Due to flexibility
  • d)
    Due to no repetition of tasks
Correct answer is option 'B'. Can you explain this answer?

Aryan Khanna answered
  • Managerial efficiency involves using the fewest number of resources to produce the largest amount of profit. The best managers are effective in giving directions and know how to keep costs down.
  • Operational efficiency is the ability of an organization to reduce waste in time, effort and materials as much as possible, while still producing a high-quality service or product.

Read the following text and answer the questions given below:
'Pappu Sweets Makers' is a sweets making company which has turnover in crores. In order to manage the work in the organisation, the departments have been created on the basis of functions.
Examine the following situations of this organisation and give answers accordingly:
Situation 1: It is expected that employees who are performing similar tasks work under the same department. So the company now has HR, Marketing and Finance departments. The division is based on specific functions.
Situation 2: There are similarities in the tasks performed within the same department.
Situation 3: The profit is increasing month by month due to the success of this structure of the organisation.
Situation 4: There has been minimum duplication of efforts as the same department is taking care of single function.
Q. What will be the result of Situation 4?
  • a)
    Reduction in cost
  • b)
    Increase in cost
  • c)
    Stability to the organization
  • d)
    None of the above
Correct answer is option 'A'. Can you explain this answer?

Shraddha Gupta answered
Understanding Situation 4: Minimum Duplication of Efforts
In Situation 4, the organization has structured its departments functionally, which has led to minimum duplication of efforts. This organizational structure directly contributes to a reduction in costs for several reasons:
1. Streamlined Processes
- Employees within the same department perform similar tasks, allowing for a more focused approach to work.
- This reduces the time and resources spent on coordinating activities across different departments.
2. Enhanced Efficiency
- Functional departments can specialize in their respective tasks, leading to higher productivity and efficiency.
- With clear roles and responsibilities, employees can work more efficiently without overlapping duties.
3. Cost Savings
- By minimizing duplication, the organization avoids unnecessary expenditures associated with redundant tasks and resources.
- For example, if two departments were previously handling the same marketing function, consolidating that function leads to fewer marketing materials and lower operational costs.
4. Better Resource Allocation
- Resources, including time, manpower, and finances, can be allocated more effectively when departments focus on single functions.
- This allows the company to invest in growth areas rather than spread resources thinly across multiple overlapping functions.
Conclusion
Overall, the results of having a well-structured functional organization, as seen in Situation 4, directly lead to a reduction in costs. This efficiency not only maximizes operational effectiveness but also contributes to the company's profit margins, allowing for reinvestment in further innovation and expansion.

Authority delegated to a subordinate can be taken back under __________
  • a)
    Centralisation
  • b)
    Delegation 
  • c)
    Decentralisation
  • d)
    None of these
Correct answer is option 'B'. Can you explain this answer?

Since the ultimate responsibility and accountability lies with superiors, it is the right of superiors to analyse the performance of their subordinates and if it is felt that there is misuse of authority and responsibility is not carried out as expected, the delegated authority can be taken back and may be re-delegated ...

Read the following text and answer the questions given below:
Bimal, the owner of 'Reliable Constructions' decided to begin a campaign in order to create awareness among the residents for creating a clean and safe environment. In an effort to develop clean surroundings in the area, he formed a team of 20 members to list the different ways that can be adopted for keeping the area clean. Different people had different suggestions, someone suggested to take the help of local residents including young children, one suggestion was to involve unemployed youth. The idea to take the help of volunteers was also given. A combination of the most effective strategies after evaluating all options was selected for implementation. To achieve the desired goals and objectives, various activities were identified like:
(i) Purchase of essential items like dustbins, garbage bags, brooms, phenyl, etc.
(ii) Door-to-door collection of garbage.
(iii) Recycling of garbage.
(iv) Disposal of garbage, etc.
Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort. After identification and grouping of these activities, the work was allocated among the different members.
Q. "Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort." Which step under the process of organizing is being referred to in this line?
  • a)
    Identification and division of work
  • b)
    Departmentalisation
  • c)
    Assignment of duties
  • d)
    Establishing reporting relationships
Correct answer is option 'B'. Can you explain this answer?

Once work has been divided into small and manageable activities then those activities which are similar in nature are grouped together. Such sets facilitate specialisation. This grouping process is called departmentalisation.

Read the following text and answer the questions given below:
Bimal, the owner of 'Reliable Constructions' decided to begin a campaign in order to create awareness among the residents for creating a clean and safe environment. In an effort to develop clean surroundings in the area, he formed a team of 20 members to list the different ways that can be adopted for keeping the area clean. Different people had different suggestions, someone suggested to take the help of local residents including young children, one suggestion was to involve unemployed youth. The idea to take the help of volunteers was also given. A combination of the most effective strategies after evaluating all options was selected for implementation. To achieve the desired goals and objectives, various activities were identified like:
(i) Purchase of essential items like dustbins, garbage bags, brooms, phenyl, etc.
(ii) Door-to-door collection of garbage.
(iii) Recycling of garbage.
(iv) Disposal of garbage, etc.
Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort. After identification and grouping of these activities, the work was allocated among the different members.
Q. "Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort." Which organisational design is being referred to in this line?
  • a)
    Functional
  • b)
    Divisional
  • c)
    Formal
  • d)
    Informal
Correct answer is option 'A'. Can you explain this answer?

Aryan Khanna answered
A functional organization is a common type of organizational structure in which the organization is divided into smaller groups based on specialized functional areas, such as IT, finance, or marketing.

Read the following text and answer the questions given below:
Bimal, the owner of 'Reliable Constructions' decided to begin a campaign in order to create awareness among the residents for creating a clean and safe environment. In an effort to develop clean surroundings in the area, he formed a team of 20 members to list the different ways that can be adopted for keeping the area clean. Different people had different suggestions, someone suggested to take the help of local residents including young children, one suggestion was to involve unemployed youth. The idea to take the help of volunteers was also given. A combination of the most effective strategies after evaluating all options was selected for implementation. To achieve the desired goals and objectives, various activities were identified like:
(i) Purchase of essential items like dustbins, garbage bags, brooms, phenyl, etc.
(ii) Door-to-door collection of garbage.
(iii) Recycling of garbage.
(iv) Disposal of garbage, etc.
Thus, an organisational design was chosen which grouped similar activities together in order to minimize duplication of effort. After identification and grouping of these activities, the work was allocated among the different members.
Q. "To achieve the desired goal various activities were identified like:...." Which step does this represent in the process of organizing?
  • a)
    Identification and division of work
  • b)
    Departmentalisation
  • c)
    Assignment of duties
  • d)
    Establishing reporting relationships
Correct answer is option 'A'. Can you explain this answer?

Vikas Kapoor answered
The process of organising involves identifying and dividing the work that has to be done in accordance with previously determined plans. The work is divided into manageable activities so that duplication can be avoided and the burden of work can be shared among the employees.

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