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After studying this 
chapter, you should 
be able to:
n Describe the 
characteristics of 
management and 
its importance in 
an organisation;
n Explain the nature 
of management 
as an art, science 
and profession;
n Explain the 
functions of 
management; and
n Appreciate 
the nature and 
importance of  
coordination.
NATURE AND SIGNIFICANCE  
OF MANAGEMENT
LEARNING 
OBJECTIVES
Founded in 1868, by Jamsetji Nusserwanji ,Tata the Tata Group 
is a global business conglomerate operating in over 100 countries 
across 5 continents. His strong sense of values and spirit of 
innovation and entrepreneurship are a legacy that continues to 
guide Tata companies till date. He had four goals in life: setting 
up an iron and steel company, a world-class learning institution, a 
unique hotel and a hydro-electric plant. Only the hotel became a 
reality during his lifetime, with the inauguration of the Taj Mahal 
Hotel at Colaba waterfront in Mumbai on 3 December 1903 at 
the cost of 11 million (worth 11 billion in 2015 prices). At that 
time it was the only hotel in India to have electricity. 
He believed that satisfied workers create satisfied workers and 
in lieu to this principle he paid all his workers gratuity, provident 
fund well before it was made mandatory. His management 
skills were clearly evident when minute details were chalked in 
planning and building the entire city of Jamshedpur. The values 
and principles that have governed the business for a century are 
enshrined in the Tata Code of Conduct (TCOC).
From an early foray into steel and automobiles, to staying 
abreast of the latest technologies, the Tata Group today has 
29 publicly-listed Tata enterprises, which include Tata Steel, 
Tata Motors, Tata Consultancy Services, Tata Power, Tata 
Chemicals, Tata Global Beverages, Tata T eleservices, Titan, Tata 
Communications and Indian Hotels. The group has a combined 
market capitalisation of around $103.51bn (2016-17).
Tata has a strong sense of social responsibility. They balance 
economic prosperity, environmental responsibility and social 
benefits for the community. In India, they are a partner in progress 
with Odisha, and believe in taking its stakeholders forward in 
its journey of growth. Tata Steel Thailand is one of the first 30 
companies that joined UNICEF in Child Friendly Business in 
“The Children Sustainability Forum” to make a commitment 
in protecting children’s rights. Tata Steel Europe’s Community 
Partnership Programme- ‘Future Generations’, with sub-themes 
of education, environment, health and Well-being works across 
1
Management at T ata Steel
CHAPTER
Ch_01.indd   1 24-09-2019   12:15:10 PM
Rationalised 2023-24
Page 2


After studying this 
chapter, you should 
be able to:
n Describe the 
characteristics of 
management and 
its importance in 
an organisation;
n Explain the nature 
of management 
as an art, science 
and profession;
n Explain the 
functions of 
management; and
n Appreciate 
the nature and 
importance of  
coordination.
NATURE AND SIGNIFICANCE  
OF MANAGEMENT
LEARNING 
OBJECTIVES
Founded in 1868, by Jamsetji Nusserwanji ,Tata the Tata Group 
is a global business conglomerate operating in over 100 countries 
across 5 continents. His strong sense of values and spirit of 
innovation and entrepreneurship are a legacy that continues to 
guide Tata companies till date. He had four goals in life: setting 
up an iron and steel company, a world-class learning institution, a 
unique hotel and a hydro-electric plant. Only the hotel became a 
reality during his lifetime, with the inauguration of the Taj Mahal 
Hotel at Colaba waterfront in Mumbai on 3 December 1903 at 
the cost of 11 million (worth 11 billion in 2015 prices). At that 
time it was the only hotel in India to have electricity. 
He believed that satisfied workers create satisfied workers and 
in lieu to this principle he paid all his workers gratuity, provident 
fund well before it was made mandatory. His management 
skills were clearly evident when minute details were chalked in 
planning and building the entire city of Jamshedpur. The values 
and principles that have governed the business for a century are 
enshrined in the Tata Code of Conduct (TCOC).
From an early foray into steel and automobiles, to staying 
abreast of the latest technologies, the Tata Group today has 
29 publicly-listed Tata enterprises, which include Tata Steel, 
Tata Motors, Tata Consultancy Services, Tata Power, Tata 
Chemicals, Tata Global Beverages, Tata T eleservices, Titan, Tata 
Communications and Indian Hotels. The group has a combined 
market capitalisation of around $103.51bn (2016-17).
Tata has a strong sense of social responsibility. They balance 
economic prosperity, environmental responsibility and social 
benefits for the community. In India, they are a partner in progress 
with Odisha, and believe in taking its stakeholders forward in 
its journey of growth. Tata Steel Thailand is one of the first 30 
companies that joined UNICEF in Child Friendly Business in 
“The Children Sustainability Forum” to make a commitment 
in protecting children’s rights. Tata Steel Europe’s Community 
Partnership Programme- ‘Future Generations’, with sub-themes 
of education, environment, health and Well-being works across 
1
Management at T ata Steel
CHAPTER
Ch_01.indd   1 24-09-2019   12:15:10 PM
Rationalised 2023-24
2 Business Studies
the UK, assisting job and wealth creation by supporting small and 
medium businesses with finance and business premises.
They also play a constructive role in addressing climate change – 
both by reducing carbon footprint, and by creating high performance 
steels that lead to fuel-efficient vehicles and energy-efficient buildings. 
Their Environmental Management Systems meet the ISO 14001 
standards at all of their main manufacturing sites.
Shaped by a lineage of sound and straightforward business 
principles, the Tata Group is built on a foundation of trust and 
transparency. Building such huge enterprises, sustaining and running 
them profitably are possible only through effective and efficient 
management and co-ordination at all levels.  
Source: www.tatasteel.com; Accessed June, 2018
IntroductIon 
The above case is an example of 
a successful organisation which 
is amongst the top companies in 
India. It has risen to the top because 
of its quality of management. 
Management is required in all 
kinds of organisations — those 
manufacturing handlooms, trading 
in consumer goods or providing 
hairstyling services and even in  
non-business organisations. Let us 
take another example. 
Smita Rai is a 38-year old 
entrepreneur who grew up in a 
rural district called Namchi, South 
Sikkim. She was very good in art 
and craft particularly, Wax moulds. 
She loved to make candles, often she 
make into toys and small pieces of art 
with wax and used it as a gift for her 
friends and relatuves. She was loved 
and appreciated for these. Smita 
was never happy with the conditions 
of the women in her district as 
most were poor and jobless, so she 
planned to do something to solve 
their problems because she knew 
that imparting skills for livelihood is 
needed but she had no idea of how to 
implement her idea. 
In August 2012, she met Abishek 
Lama, the Branch Manager of 
NEDFI, Namchi Branch, a financial 
corporation which support local 
people with skills development 
programs and also channelize 
them into revenue generating 
activities. Smita got interested. “I 
love making candles, then, why not 
convert my hobby into a venture 
and involve these rural women 
also”, she thought. This led to the 
establishment of Namchi Designer 
Candles with the help of NEDFI, 
some financial institutions and 
support from different stakeholders 
in various dimensions. 
Since then, the women have never 
looked back, despite challenges. The 
Ch_01.indd   2 24-09-2019   12:15:10 PM
Rationalised 2023-24
Page 3


After studying this 
chapter, you should 
be able to:
n Describe the 
characteristics of 
management and 
its importance in 
an organisation;
n Explain the nature 
of management 
as an art, science 
and profession;
n Explain the 
functions of 
management; and
n Appreciate 
the nature and 
importance of  
coordination.
NATURE AND SIGNIFICANCE  
OF MANAGEMENT
LEARNING 
OBJECTIVES
Founded in 1868, by Jamsetji Nusserwanji ,Tata the Tata Group 
is a global business conglomerate operating in over 100 countries 
across 5 continents. His strong sense of values and spirit of 
innovation and entrepreneurship are a legacy that continues to 
guide Tata companies till date. He had four goals in life: setting 
up an iron and steel company, a world-class learning institution, a 
unique hotel and a hydro-electric plant. Only the hotel became a 
reality during his lifetime, with the inauguration of the Taj Mahal 
Hotel at Colaba waterfront in Mumbai on 3 December 1903 at 
the cost of 11 million (worth 11 billion in 2015 prices). At that 
time it was the only hotel in India to have electricity. 
He believed that satisfied workers create satisfied workers and 
in lieu to this principle he paid all his workers gratuity, provident 
fund well before it was made mandatory. His management 
skills were clearly evident when minute details were chalked in 
planning and building the entire city of Jamshedpur. The values 
and principles that have governed the business for a century are 
enshrined in the Tata Code of Conduct (TCOC).
From an early foray into steel and automobiles, to staying 
abreast of the latest technologies, the Tata Group today has 
29 publicly-listed Tata enterprises, which include Tata Steel, 
Tata Motors, Tata Consultancy Services, Tata Power, Tata 
Chemicals, Tata Global Beverages, Tata T eleservices, Titan, Tata 
Communications and Indian Hotels. The group has a combined 
market capitalisation of around $103.51bn (2016-17).
Tata has a strong sense of social responsibility. They balance 
economic prosperity, environmental responsibility and social 
benefits for the community. In India, they are a partner in progress 
with Odisha, and believe in taking its stakeholders forward in 
its journey of growth. Tata Steel Thailand is one of the first 30 
companies that joined UNICEF in Child Friendly Business in 
“The Children Sustainability Forum” to make a commitment 
in protecting children’s rights. Tata Steel Europe’s Community 
Partnership Programme- ‘Future Generations’, with sub-themes 
of education, environment, health and Well-being works across 
1
Management at T ata Steel
CHAPTER
Ch_01.indd   1 24-09-2019   12:15:10 PM
Rationalised 2023-24
2 Business Studies
the UK, assisting job and wealth creation by supporting small and 
medium businesses with finance and business premises.
They also play a constructive role in addressing climate change – 
both by reducing carbon footprint, and by creating high performance 
steels that lead to fuel-efficient vehicles and energy-efficient buildings. 
Their Environmental Management Systems meet the ISO 14001 
standards at all of their main manufacturing sites.
Shaped by a lineage of sound and straightforward business 
principles, the Tata Group is built on a foundation of trust and 
transparency. Building such huge enterprises, sustaining and running 
them profitably are possible only through effective and efficient 
management and co-ordination at all levels.  
Source: www.tatasteel.com; Accessed June, 2018
IntroductIon 
The above case is an example of 
a successful organisation which 
is amongst the top companies in 
India. It has risen to the top because 
of its quality of management. 
Management is required in all 
kinds of organisations — those 
manufacturing handlooms, trading 
in consumer goods or providing 
hairstyling services and even in  
non-business organisations. Let us 
take another example. 
Smita Rai is a 38-year old 
entrepreneur who grew up in a 
rural district called Namchi, South 
Sikkim. She was very good in art 
and craft particularly, Wax moulds. 
She loved to make candles, often she 
make into toys and small pieces of art 
with wax and used it as a gift for her 
friends and relatuves. She was loved 
and appreciated for these. Smita 
was never happy with the conditions 
of the women in her district as 
most were poor and jobless, so she 
planned to do something to solve 
their problems because she knew 
that imparting skills for livelihood is 
needed but she had no idea of how to 
implement her idea. 
In August 2012, she met Abishek 
Lama, the Branch Manager of 
NEDFI, Namchi Branch, a financial 
corporation which support local 
people with skills development 
programs and also channelize 
them into revenue generating 
activities. Smita got interested. “I 
love making candles, then, why not 
convert my hobby into a venture 
and involve these rural women 
also”, she thought. This led to the 
establishment of Namchi Designer 
Candles with the help of NEDFI, 
some financial institutions and 
support from different stakeholders 
in various dimensions. 
Since then, the women have never 
looked back, despite challenges. The 
Ch_01.indd   2 24-09-2019   12:15:10 PM
Rationalised 2023-24
Nature and Significance of Management 3
women also faced a lot of harassment 
but they could overcome all  
those troubles. 
Namchi Designer Candles has 
100 per cent women as employees 
and they also produce varieties of 
candles. During Diwali, they produce 
customized candles meant for the 
occasion. These Diwali themed candle 
has been a success in Sikkim as its 
demand increases on a yearly basis. 
Namchi Designer Candles has been 
receiving numerous awards such as 
North East Women Entrepreneur 
of the year 2015-2016 for Sikkim 
and Sreemanta Shankar Mission 
of Guwahati on 26th April 2018 at  
New Delhi.
A typical day in Smita’s life 
consists of a series of interrelated 
and continuous functions. She has 
to plan a special festive collection 
for Diwali. This means organising 
more funds and recruiting more 
workers. She also has to regularly 
communicate with her suppliers 
to ensure that deadlines regarding 
delivery of goods are met. In the 
course of the day, she meets 
customers for a general feedback 
and any suggestions that they  
may have. 
Smita is managing Namchi Designer 
Candles. So is the Principal managing 
your school. They all manage 
organisations. Schools, hospitals, 
shops and large corporations are all 
organisations with diverse goals that 
are aimed at achieving something. 
No matter what the organisation is or 
what its goals might be, they all have 
something in common-management 
and managers.
You have observed that Smita’s 
work as a manager consists of 
a series of different activities or 
functions aimed at achieving the 
goals of the organisation. These 
interconnected and interdependent 
functions are part of management. 
Successful organisations do not 
achieve their goals by chance but  
by following a deliberate process 
called ‘management’.
“Management is the process of designing and maintaining an environment in which 
individuals, working together in groups, efficiently accomplish selected aims.”
 Harold Koontz and Heinz Weihrich
“Management is defined as t he process of planning, organising, actuating and controlling 
an organisation’s operations in order to achieve coordination of the human and material 
resources essential in the effective and efficient attainment of objectives.” 
Robert L. T rewelly and M. Gene Newport
“Management is the process of working with and through others to effectively achieve 
organisational objectives by efficiently using limited resources in the changing environment.”
Kreitner
Definitions of Management
Ch_01.indd   3 24-09-2019   12:15:10 PM
Rationalised 2023-24
Page 4


After studying this 
chapter, you should 
be able to:
n Describe the 
characteristics of 
management and 
its importance in 
an organisation;
n Explain the nature 
of management 
as an art, science 
and profession;
n Explain the 
functions of 
management; and
n Appreciate 
the nature and 
importance of  
coordination.
NATURE AND SIGNIFICANCE  
OF MANAGEMENT
LEARNING 
OBJECTIVES
Founded in 1868, by Jamsetji Nusserwanji ,Tata the Tata Group 
is a global business conglomerate operating in over 100 countries 
across 5 continents. His strong sense of values and spirit of 
innovation and entrepreneurship are a legacy that continues to 
guide Tata companies till date. He had four goals in life: setting 
up an iron and steel company, a world-class learning institution, a 
unique hotel and a hydro-electric plant. Only the hotel became a 
reality during his lifetime, with the inauguration of the Taj Mahal 
Hotel at Colaba waterfront in Mumbai on 3 December 1903 at 
the cost of 11 million (worth 11 billion in 2015 prices). At that 
time it was the only hotel in India to have electricity. 
He believed that satisfied workers create satisfied workers and 
in lieu to this principle he paid all his workers gratuity, provident 
fund well before it was made mandatory. His management 
skills were clearly evident when minute details were chalked in 
planning and building the entire city of Jamshedpur. The values 
and principles that have governed the business for a century are 
enshrined in the Tata Code of Conduct (TCOC).
From an early foray into steel and automobiles, to staying 
abreast of the latest technologies, the Tata Group today has 
29 publicly-listed Tata enterprises, which include Tata Steel, 
Tata Motors, Tata Consultancy Services, Tata Power, Tata 
Chemicals, Tata Global Beverages, Tata T eleservices, Titan, Tata 
Communications and Indian Hotels. The group has a combined 
market capitalisation of around $103.51bn (2016-17).
Tata has a strong sense of social responsibility. They balance 
economic prosperity, environmental responsibility and social 
benefits for the community. In India, they are a partner in progress 
with Odisha, and believe in taking its stakeholders forward in 
its journey of growth. Tata Steel Thailand is one of the first 30 
companies that joined UNICEF in Child Friendly Business in 
“The Children Sustainability Forum” to make a commitment 
in protecting children’s rights. Tata Steel Europe’s Community 
Partnership Programme- ‘Future Generations’, with sub-themes 
of education, environment, health and Well-being works across 
1
Management at T ata Steel
CHAPTER
Ch_01.indd   1 24-09-2019   12:15:10 PM
Rationalised 2023-24
2 Business Studies
the UK, assisting job and wealth creation by supporting small and 
medium businesses with finance and business premises.
They also play a constructive role in addressing climate change – 
both by reducing carbon footprint, and by creating high performance 
steels that lead to fuel-efficient vehicles and energy-efficient buildings. 
Their Environmental Management Systems meet the ISO 14001 
standards at all of their main manufacturing sites.
Shaped by a lineage of sound and straightforward business 
principles, the Tata Group is built on a foundation of trust and 
transparency. Building such huge enterprises, sustaining and running 
them profitably are possible only through effective and efficient 
management and co-ordination at all levels.  
Source: www.tatasteel.com; Accessed June, 2018
IntroductIon 
The above case is an example of 
a successful organisation which 
is amongst the top companies in 
India. It has risen to the top because 
of its quality of management. 
Management is required in all 
kinds of organisations — those 
manufacturing handlooms, trading 
in consumer goods or providing 
hairstyling services and even in  
non-business organisations. Let us 
take another example. 
Smita Rai is a 38-year old 
entrepreneur who grew up in a 
rural district called Namchi, South 
Sikkim. She was very good in art 
and craft particularly, Wax moulds. 
She loved to make candles, often she 
make into toys and small pieces of art 
with wax and used it as a gift for her 
friends and relatuves. She was loved 
and appreciated for these. Smita 
was never happy with the conditions 
of the women in her district as 
most were poor and jobless, so she 
planned to do something to solve 
their problems because she knew 
that imparting skills for livelihood is 
needed but she had no idea of how to 
implement her idea. 
In August 2012, she met Abishek 
Lama, the Branch Manager of 
NEDFI, Namchi Branch, a financial 
corporation which support local 
people with skills development 
programs and also channelize 
them into revenue generating 
activities. Smita got interested. “I 
love making candles, then, why not 
convert my hobby into a venture 
and involve these rural women 
also”, she thought. This led to the 
establishment of Namchi Designer 
Candles with the help of NEDFI, 
some financial institutions and 
support from different stakeholders 
in various dimensions. 
Since then, the women have never 
looked back, despite challenges. The 
Ch_01.indd   2 24-09-2019   12:15:10 PM
Rationalised 2023-24
Nature and Significance of Management 3
women also faced a lot of harassment 
but they could overcome all  
those troubles. 
Namchi Designer Candles has 
100 per cent women as employees 
and they also produce varieties of 
candles. During Diwali, they produce 
customized candles meant for the 
occasion. These Diwali themed candle 
has been a success in Sikkim as its 
demand increases on a yearly basis. 
Namchi Designer Candles has been 
receiving numerous awards such as 
North East Women Entrepreneur 
of the year 2015-2016 for Sikkim 
and Sreemanta Shankar Mission 
of Guwahati on 26th April 2018 at  
New Delhi.
A typical day in Smita’s life 
consists of a series of interrelated 
and continuous functions. She has 
to plan a special festive collection 
for Diwali. This means organising 
more funds and recruiting more 
workers. She also has to regularly 
communicate with her suppliers 
to ensure that deadlines regarding 
delivery of goods are met. In the 
course of the day, she meets 
customers for a general feedback 
and any suggestions that they  
may have. 
Smita is managing Namchi Designer 
Candles. So is the Principal managing 
your school. They all manage 
organisations. Schools, hospitals, 
shops and large corporations are all 
organisations with diverse goals that 
are aimed at achieving something. 
No matter what the organisation is or 
what its goals might be, they all have 
something in common-management 
and managers.
You have observed that Smita’s 
work as a manager consists of 
a series of different activities or 
functions aimed at achieving the 
goals of the organisation. These 
interconnected and interdependent 
functions are part of management. 
Successful organisations do not 
achieve their goals by chance but  
by following a deliberate process 
called ‘management’.
“Management is the process of designing and maintaining an environment in which 
individuals, working together in groups, efficiently accomplish selected aims.”
 Harold Koontz and Heinz Weihrich
“Management is defined as t he process of planning, organising, actuating and controlling 
an organisation’s operations in order to achieve coordination of the human and material 
resources essential in the effective and efficient attainment of objectives.” 
Robert L. T rewelly and M. Gene Newport
“Management is the process of working with and through others to effectively achieve 
organisational objectives by efficiently using limited resources in the changing environment.”
Kreitner
Definitions of Management
Ch_01.indd   3 24-09-2019   12:15:10 PM
Rationalised 2023-24
4 Business Studies
Management is essential for all 
organisations big or small, profit or 
non-profit, services or manufacturing. 
Management is necessary so that 
individuals make their best contri-
bution towards group objectives. 
Management consists of a series 
of interrelated functions that are 
performed by all managers. Later in 
this chapter you will understand that 
although both of them are managers, 
they function at different levels in 
the organisation. The time spent 
by managers in different functions 
however is different. Managers at the 
top level spend more time in planning 
and organising than managers at 
lower levels of the organisation. 
c oncept Management is a very popular term 
and has been used extensively for 
all types of activities and mainly for 
taking charge of different activities in 
any enterprise. As you have seen from 
the above example and case study 
that management is an activity which 
is necessary wherever there is a group 
of people working in an organisation. 
People in organisations are performing 
diverse tasks but they are all working 
towards the same goal. Management 
aims at guiding their efforts towards 
achieving a common objective — a 
goal. Thus, management has to see 
that tasks are completed and goals 
are achieved (i.e., effectiveness) with 
the least amount of resources at a 
minimum cost (i.e., efficiency).
Management, has therefore, been 
defined as a process of getting things 
done with the aim of achieving goals 
effectively and efficiently. We need 
to analyse this definition. There 
are certain terms which require 
elaboration. These are (a) process, (b) 
effectively, and (c) efficiently.
Process in the definition means the 
primary functions or activities that 
management performs to get things 
done. These functions are planning, 
organising, staffing, directing and 
controlling which we will discuss later  
in the chapter and the book.
Being effective or doing work 
effectively basically means finishing 
the given task. Effectiveness in 
management is concerned with doing 
the right task, completing activities 
and achieving goals. In other words, 
it is concerned with the end result.
But it is not enough to just 
complete the tasks. There is another 
aspect also, i.e., being efficient or as 
we say doing work efficiently.
Efficiency means doing the task 
correctly and with minimum cost. 
There is a kind of cost-benefit  
analysis involved and the relationship 
between inputs and outputs. If 
by using less resources (i.e., the 
inputs) more benefits are derived 
(i.e., the outputs) then efficiency has 
increased. Efficiency is also increased 
when for the same benefit or outputs, 
fewer resources are used and less 
costs are incurred. Input resources 
are money, materials, equipment and 
Ch_01.indd   4 24-09-2019   12:15:10 PM
Rationalised 2023-24
Page 5


After studying this 
chapter, you should 
be able to:
n Describe the 
characteristics of 
management and 
its importance in 
an organisation;
n Explain the nature 
of management 
as an art, science 
and profession;
n Explain the 
functions of 
management; and
n Appreciate 
the nature and 
importance of  
coordination.
NATURE AND SIGNIFICANCE  
OF MANAGEMENT
LEARNING 
OBJECTIVES
Founded in 1868, by Jamsetji Nusserwanji ,Tata the Tata Group 
is a global business conglomerate operating in over 100 countries 
across 5 continents. His strong sense of values and spirit of 
innovation and entrepreneurship are a legacy that continues to 
guide Tata companies till date. He had four goals in life: setting 
up an iron and steel company, a world-class learning institution, a 
unique hotel and a hydro-electric plant. Only the hotel became a 
reality during his lifetime, with the inauguration of the Taj Mahal 
Hotel at Colaba waterfront in Mumbai on 3 December 1903 at 
the cost of 11 million (worth 11 billion in 2015 prices). At that 
time it was the only hotel in India to have electricity. 
He believed that satisfied workers create satisfied workers and 
in lieu to this principle he paid all his workers gratuity, provident 
fund well before it was made mandatory. His management 
skills were clearly evident when minute details were chalked in 
planning and building the entire city of Jamshedpur. The values 
and principles that have governed the business for a century are 
enshrined in the Tata Code of Conduct (TCOC).
From an early foray into steel and automobiles, to staying 
abreast of the latest technologies, the Tata Group today has 
29 publicly-listed Tata enterprises, which include Tata Steel, 
Tata Motors, Tata Consultancy Services, Tata Power, Tata 
Chemicals, Tata Global Beverages, Tata T eleservices, Titan, Tata 
Communications and Indian Hotels. The group has a combined 
market capitalisation of around $103.51bn (2016-17).
Tata has a strong sense of social responsibility. They balance 
economic prosperity, environmental responsibility and social 
benefits for the community. In India, they are a partner in progress 
with Odisha, and believe in taking its stakeholders forward in 
its journey of growth. Tata Steel Thailand is one of the first 30 
companies that joined UNICEF in Child Friendly Business in 
“The Children Sustainability Forum” to make a commitment 
in protecting children’s rights. Tata Steel Europe’s Community 
Partnership Programme- ‘Future Generations’, with sub-themes 
of education, environment, health and Well-being works across 
1
Management at T ata Steel
CHAPTER
Ch_01.indd   1 24-09-2019   12:15:10 PM
Rationalised 2023-24
2 Business Studies
the UK, assisting job and wealth creation by supporting small and 
medium businesses with finance and business premises.
They also play a constructive role in addressing climate change – 
both by reducing carbon footprint, and by creating high performance 
steels that lead to fuel-efficient vehicles and energy-efficient buildings. 
Their Environmental Management Systems meet the ISO 14001 
standards at all of their main manufacturing sites.
Shaped by a lineage of sound and straightforward business 
principles, the Tata Group is built on a foundation of trust and 
transparency. Building such huge enterprises, sustaining and running 
them profitably are possible only through effective and efficient 
management and co-ordination at all levels.  
Source: www.tatasteel.com; Accessed June, 2018
IntroductIon 
The above case is an example of 
a successful organisation which 
is amongst the top companies in 
India. It has risen to the top because 
of its quality of management. 
Management is required in all 
kinds of organisations — those 
manufacturing handlooms, trading 
in consumer goods or providing 
hairstyling services and even in  
non-business organisations. Let us 
take another example. 
Smita Rai is a 38-year old 
entrepreneur who grew up in a 
rural district called Namchi, South 
Sikkim. She was very good in art 
and craft particularly, Wax moulds. 
She loved to make candles, often she 
make into toys and small pieces of art 
with wax and used it as a gift for her 
friends and relatuves. She was loved 
and appreciated for these. Smita 
was never happy with the conditions 
of the women in her district as 
most were poor and jobless, so she 
planned to do something to solve 
their problems because she knew 
that imparting skills for livelihood is 
needed but she had no idea of how to 
implement her idea. 
In August 2012, she met Abishek 
Lama, the Branch Manager of 
NEDFI, Namchi Branch, a financial 
corporation which support local 
people with skills development 
programs and also channelize 
them into revenue generating 
activities. Smita got interested. “I 
love making candles, then, why not 
convert my hobby into a venture 
and involve these rural women 
also”, she thought. This led to the 
establishment of Namchi Designer 
Candles with the help of NEDFI, 
some financial institutions and 
support from different stakeholders 
in various dimensions. 
Since then, the women have never 
looked back, despite challenges. The 
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Nature and Significance of Management 3
women also faced a lot of harassment 
but they could overcome all  
those troubles. 
Namchi Designer Candles has 
100 per cent women as employees 
and they also produce varieties of 
candles. During Diwali, they produce 
customized candles meant for the 
occasion. These Diwali themed candle 
has been a success in Sikkim as its 
demand increases on a yearly basis. 
Namchi Designer Candles has been 
receiving numerous awards such as 
North East Women Entrepreneur 
of the year 2015-2016 for Sikkim 
and Sreemanta Shankar Mission 
of Guwahati on 26th April 2018 at  
New Delhi.
A typical day in Smita’s life 
consists of a series of interrelated 
and continuous functions. She has 
to plan a special festive collection 
for Diwali. This means organising 
more funds and recruiting more 
workers. She also has to regularly 
communicate with her suppliers 
to ensure that deadlines regarding 
delivery of goods are met. In the 
course of the day, she meets 
customers for a general feedback 
and any suggestions that they  
may have. 
Smita is managing Namchi Designer 
Candles. So is the Principal managing 
your school. They all manage 
organisations. Schools, hospitals, 
shops and large corporations are all 
organisations with diverse goals that 
are aimed at achieving something. 
No matter what the organisation is or 
what its goals might be, they all have 
something in common-management 
and managers.
You have observed that Smita’s 
work as a manager consists of 
a series of different activities or 
functions aimed at achieving the 
goals of the organisation. These 
interconnected and interdependent 
functions are part of management. 
Successful organisations do not 
achieve their goals by chance but  
by following a deliberate process 
called ‘management’.
“Management is the process of designing and maintaining an environment in which 
individuals, working together in groups, efficiently accomplish selected aims.”
 Harold Koontz and Heinz Weihrich
“Management is defined as t he process of planning, organising, actuating and controlling 
an organisation’s operations in order to achieve coordination of the human and material 
resources essential in the effective and efficient attainment of objectives.” 
Robert L. T rewelly and M. Gene Newport
“Management is the process of working with and through others to effectively achieve 
organisational objectives by efficiently using limited resources in the changing environment.”
Kreitner
Definitions of Management
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4 Business Studies
Management is essential for all 
organisations big or small, profit or 
non-profit, services or manufacturing. 
Management is necessary so that 
individuals make their best contri-
bution towards group objectives. 
Management consists of a series 
of interrelated functions that are 
performed by all managers. Later in 
this chapter you will understand that 
although both of them are managers, 
they function at different levels in 
the organisation. The time spent 
by managers in different functions 
however is different. Managers at the 
top level spend more time in planning 
and organising than managers at 
lower levels of the organisation. 
c oncept Management is a very popular term 
and has been used extensively for 
all types of activities and mainly for 
taking charge of different activities in 
any enterprise. As you have seen from 
the above example and case study 
that management is an activity which 
is necessary wherever there is a group 
of people working in an organisation. 
People in organisations are performing 
diverse tasks but they are all working 
towards the same goal. Management 
aims at guiding their efforts towards 
achieving a common objective — a 
goal. Thus, management has to see 
that tasks are completed and goals 
are achieved (i.e., effectiveness) with 
the least amount of resources at a 
minimum cost (i.e., efficiency).
Management, has therefore, been 
defined as a process of getting things 
done with the aim of achieving goals 
effectively and efficiently. We need 
to analyse this definition. There 
are certain terms which require 
elaboration. These are (a) process, (b) 
effectively, and (c) efficiently.
Process in the definition means the 
primary functions or activities that 
management performs to get things 
done. These functions are planning, 
organising, staffing, directing and 
controlling which we will discuss later  
in the chapter and the book.
Being effective or doing work 
effectively basically means finishing 
the given task. Effectiveness in 
management is concerned with doing 
the right task, completing activities 
and achieving goals. In other words, 
it is concerned with the end result.
But it is not enough to just 
complete the tasks. There is another 
aspect also, i.e., being efficient or as 
we say doing work efficiently.
Efficiency means doing the task 
correctly and with minimum cost. 
There is a kind of cost-benefit  
analysis involved and the relationship 
between inputs and outputs. If 
by using less resources (i.e., the 
inputs) more benefits are derived 
(i.e., the outputs) then efficiency has 
increased. Efficiency is also increased 
when for the same benefit or outputs, 
fewer resources are used and less 
costs are incurred. Input resources 
are money, materials, equipment and 
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Nature and Significance of Management 5
persons required to do a particular 
task. Obviously, management is 
concerned with the efficient use 
of these resources, because they  
reduce costs and ultimately lead to 
higher profits.
Effectiveness versus 
Efficiency
These two terms are different but they 
are interrelated. For management, 
it is important to be both effective 
and efficient. Effectiveness and 
efficiency are two sides of the same 
coin. But these two aspects need 
to be balanced and management 
at times, has to compromise with 
efficiency. For example, it is easier 
to be effective and ignore efficiency  
i.e., complete the given task but at 
a high cost. Suppose, a company’s 
target production is 5000 units in 
a year. To achieve this target the 
manager has to operate on double 
shifts due to power failure most of the 
time. The manager is able to produce 
5000 units but at a higher production 
cost. In this case, the manager was 
effective but not so efficient, since for 
the same output, more inputs (labour 
cost, electricity costs) were used.
At times, a business may con-
centrate more on producing goods 
with fewer resources i.e., cutting 
down cost but not achieving the 
target production. Consequently, the 
goods do not reach the market and 
hence the demand for them declines 
and competitors enter the market. 
This is a case of being efficient but 
not effective since the goods did not 
reach the market.
Therefore, it is important for 
management to achieve goals 
(effectiveness) with minimum 
resources i.e., as efficiently as possible 
while maintaining a balance between 
effectiveness and efficiency. Usually 
high efficiency is associated with  
high effectiveness which is the aim of  
all managers. But undue emphasis  
on high efficiency without being 
effective is also not desirable. Poor  
management is due to both ineffi-
ciency and ineffectiveness. 
c haracterIstIcs of 
ManageMent After going through some of the 
definitions we find some elements 
that may be called the basic 
characteristics of management:
 (i) Management is a goal-oriented 
process: An organisation has a  
set of basic goals which are the 
basic reason for its existence. 
These should be simple and  
clearly stated. Different organ-
isations have different goals. For 
example, the goal of a retail store 
may be to increase sales, but the 
goal of The Spastics Society of 
India is to impart education to  
children with special needs. 
Management unites the efforts 
of different individuals in the 
organisation towards achieving 
these goals.
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35 videos|205 docs|49 tests

FAQs on NCERT Textbook - Nature and Significance of Management - Business Studies (BST) Class 12 - Commerce

1. What is management and what are its objectives?
Ans. Management refers to the process of planning, organizing, staffing, directing, and controlling the resources of an organization to achieve its goals effectively and efficiently. The objectives of management are to maximize the productivity and profitability of the organization while ensuring the satisfaction of its employees and customers.
2. What are the different levels of management and what are their roles?
Ans. The different levels of management are top-level management, middle-level management, and lower-level management. Top-level management is responsible for setting the overall direction and strategy of the organization. Middle-level management is responsible for implementing the strategy and coordinating the activities of lower-level managers. Lower-level management is responsible for supervising the day-to-day activities of the organization.
3. What are the functions of management and how do they relate to each other?
Ans. The functions of management are planning, organizing, staffing, directing, and controlling. Planning involves setting goals, developing strategies, and determining resources needed to achieve the goals. Organizing involves arranging resources to achieve the goals. Staffing involves recruiting, selecting, and training employees. Directing involves motivating employees to achieve the goals. Controlling involves monitoring performance and taking corrective action when necessary. These functions are interrelated and must be performed in a coordinated manner for effective management.
4. What are the skills required for effective management?
Ans. The skills required for effective management include technical skills, human skills, and conceptual skills. Technical skills refer to the ability to use tools and techniques to perform specific tasks. Human skills refer to the ability to work with and through other people. Conceptual skills refer to the ability to think abstractly and to see the organization as a whole. Effective managers must possess all three skills to be successful.
5. What are the challenges faced by managers in today's business environment?
Ans. The challenges faced by managers in today's business environment include globalization, technological change, workforce diversity, and increasing competition. Globalization has increased the complexity of doing business across borders. Technological change has made it necessary for managers to stay abreast of the latest developments in their field. Workforce diversity has made it necessary for managers to be sensitive to cultural differences. Increasing competition has made it necessary for managers to be innovative and to constantly seek ways to improve the organization's performance.
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