Previous Year Short & Long Questions With Answers - Principles of Management | Business Studies (BST) Class 12 - Commerce PDF Download

Short Answer Type Questions

Q. 1. Explain how principles of Management:
(i) Help in optimum utilisation of resources and effective administration;
(ii) Help the managers in meeting changing environment requirements.
Ans. (i) Principles of management help in the optimum utilisation of resources by equipping managers to foresee the cause and effect relationships thereby reducing the wastages associated with the trial and error approach. Principles of management help in effective administration by limiting the boundaries of managerial discretion so that decisions are free from personal prejudices.
(ii) Principles of management help managers meet the requirements of a changing environment because they can be modified according to the changes taking place in the environment.

Q. 2. Explain how Principles of Management:
(i) Provide useful insights into reality, and
(ii) Help in thoughtful decision-making.
Ans. (i) Principles of management provide useful insights into reality by enabling managers to learn from past mistakes and conserve time by solving recurring problems quickly.
(ii) Principles of management help in thoughtful decision-making because the decisions based on principles are not biased and are based on the objective assessment of the situation.

Q. 3. What is meant by the statement, “Principles of Management are Flexible”?
Ans. Management Principles are not as rigid as those of natural science viz. Physics and Chemistry. Principles of Management are not applied blindly in an identical manner to all situations. Management principles are not absolute and should be utilised in the light of changing and special conditions. Management principles do not provide any hard and fast rules and they have to be modified as per changes in the business environment.

Q. 4. Explain any four points regarding the significance of principles of management.
OR
Explain any four points of importance of Principles of Management.
OR
State any four points that highlight the importance of Principles of Management.
Ans. Importance of Principles of Management:
(i) Providing managers with useful insights into reality: The principles of management provide managers with useful insights into real-world situations. Adherence to these principles will add to their knowledge, ability and understanding of managerial situations and circumstances. It will also enable managers to learn from past mistakes and conserve time by solving recurring problems quickly. As such management principles increase managerial efficiency.
(ii) Optimum utilisation of resources and effective administration: Both human and material resources, available with the company are limited. They have to be put to optimum use. By optimum use, we mean that the resources should be put to use in such a manner that they should give maximum benefit with minimum cost. Principles equip managers to foresee the cause-and-effect relationships of their decisions and actions. As such the wastages associated with a trial-and-error approach can be overcome.
(iii) Scientific decisions: Decisions must be based on facts, thoughtful and justifiable in terms of the intended purposes. They must be timely, realistic and subjected to measurement and evaluation. Management principles help in thoughtful decision-making. They emphasize logic rather than blind faith. Management decisions are taken on the basis of principles that are free from bias and prejudice. They are based on the objective assessment of the situation.
(iv) Meeting changing environment requirements: Although the principles are like general guidelines they are modified and as such help managers to meet the changing requirements of the environment. Management principles are flexible to adapt to a dynamic business environment.
(v) Fulfilling social responsibility: The increased awareness of the public, forces businesses, especially limited companies to fulfil their social responsibilities. Management theory and management principles have also evolved in response to these demands. Moreover, the interpretation of the principles also assumes newer and contemporary meanings with the change in time.
(vi) Providing basis for Management training, education and research: Principles of management are at the core of management theory. As such these are used as a basis for management training, education and research. These principles provide basic groundwork for the development of management as a discipline. These principles enable refinement of management practices as well by facilitating the development of new management techniques which have developed due to further research on these principles.

Q. 5. Explain “Unity of Direction” and “Order” as principles of general management.
Ans. (i) Order: Fayol advocated that people and materials must be in suitable places at appropriate times for maximum efficiency i.e. there should be a place for everything and everyone in an organisation and that things or persons should be found at the allotted place. This will lead to an increase in productivity and efficiency. For example, Raw material should be available at the place prescribed for it.
(ii) Unity of direction: According to their principle, each unit of the organisation should work towards a common objective. Each unit should have a single head and plan. It helps in eliminating the overlapping of work.

Q. 6. Explain briefly ‘Espirit de Corps’ and ‘Order’ as general principles of management.
Ans. Esprit de Corps
(i) It states that management should promote a team spirit of unity and harmony among employees to realise organisational objectives. The manager should replace ‘I’ with ‘We’ to foster team spirit.
(ii) This will give rise to a spirit of mutual trust and belongingness among team members. It will also minimise the need for using penalties. Order
(i) It states that there should be a place for everything and everyone in an organisation and that thing or person should be found at the allotted place.
(ii) People and materials must be in suitable places at appropriate times for maximum efficiency.

Q. 7. Explain ‘unity of command’ and ‘equity’ as principles of general management.
Ans. Unity of command: According to this principle, one subordinate should receive orders from one superior only at a given point in time. The principle is necessary to avoid confusion and conflict.
Equity: The principle of equity implies of sense of fairness and justice to all workers working in an organisation. Observance of equity alone would make workers loyal and devoted to the organisation. Equity does not mean equal salary to a person and supervisor. Equity means the application of the same disciplinary rules, leave rules, etc. irrespective of grade, position and gender, language, religion or nationality, etc.

Q. 8. Name and explain the principle of management according to which a manager should replace ‘I’ with ‘We’ in all his conversations with workers. 
Ans. Esprit de Corps given by Henry Fayol: According to this principle, management should promote a team spirit of unity and harmony among its employees. This will give rise to a spirit of mutual unity and harmony among the employees. This will give rise to a spirit of mutual trust and will create a sense of belongingness towards the organisation.

Q. 9. Prashant Toys Pvt. Ltd. manufactures and sells toys of different types. Two founders of the company, Prashant and Nishant, jointly look after the overall management of the company. Since there is no clear-cut demarcation of authority between the two, often contradictory orders are passed to production and marketing people. Sometimes, this situation becomes embarrassing to the production and marketing manager.
(i) Which principles of Management are being violated in this case?
(ii) State two steps that the company should take to overcome the problem.
Ans. (i) The Principle of Authority and Responsibility and the principle of Unity of Command are being violated here.
(ii) The following steps can be taken to overcome the problem:
(a) The promoters should define their areas of authority based on functions performed by them.
(b) The promoters should issue orders in their specific areas only to avoid confusion.

Q. 10. Explain the following principles of “Scientific Management”.
(i) Science, not a rule of thumb
(ii) Co-operation, not individualism
(iii) Harmony, not discord.
OR
Explain ‘Harmony, not discord’ as a principle of scientific management.
OR
Explain ‘Science, not a rule of thumb’ as a principle of management.
OR
Explain ‘Cooperation not individualism’ as a principle of scientific management.
Ans. (i) Science, not a rule of thumb: Taylor believed that there was only one best method to maximise efficiency. This method can be developed through scientific study and analysis of each element of a job and should substitute the ‘Rule of Thumb‘. This standard method then should be followed throughout the organisation.
(ii) Co-operation, not individualism: There should be complete cooperation between the labour and management instead of individualism; competition should be replaced by cooperation. Both should realise that they need each other.
(iii) Harmony, not discord: According to Taylor, there should not be any conflict between the managers and the workers. He emphasised that there should be complete harmony between the managers and the workers. Both should realise that each one is important to achieve the objectives of the organisation.

Q. 11. Enumerate any two techniques of Scientific Management.
Ans. Techniques of Scientific Management:
(i) Functional Foremanship: Functional Foremanship divides planning and execution tasks, with eight specialists overseeing worker performance:

Planning In-Charges
1. Route Clerk: Determines the production sequence.
2. Instruction Card Clerk: Prepares instructions for workers.
3. Time and Cost Clerk: Maintains time and cost records.
4. Shop Disciplinarian: Enforces discipline and rules.

Production In-Charges
1. Gang Boss: Prepares tools and machines.
2. Speed Boss: Ensures timely and accurate work.
3. Repair Boss: Maintains equipment.
4. Inspector: Monitors work quality.

(ii) Standardization and Simplification of Work: Standardization involves setting uniform standards for business activities, while Simplification focuses on reducing unnecessary varieties of products or services. Simplification helps save costs on labour, machinery, and tools, ensures better utilization of equipment, and boosts turnover.

Q. 12. Explain the technique of scientific management that is the extension of the ‘Principle of Division of Work and Specialisation’.
OR
Explain the technique of scientific management which separates the planning and execution work.
Ans. The technique of Functional Foremanship.
(i) Functional Foremanship is a technique that aims to improve the quality of supervision on the shop floor by putting a worker under eight specialist foremen.
(ii) In this technique, planning is separated from execution.
Under Planning Department:
(a) Route Clerk: This foreman lays down the sequence of operations, in which the work is to be carried out by each class of machines and men.
(b) Instruction Card Clerk: This foreman has to lay down the instructions and guidelines that workers need to follow to do their jobs.
(c) Time and Cost Clerk: This foreman records the time taken by a worker to complete a job. He also keeps a record of the cost of the work done.
(d) Disciplinarian: He is responsible for discipline and systematic performance of the job. 

Under Production Department:
(a) Gang Boss: He is responsible for keeping machines, materials, tools, etc. ready for operation by the concerned workers.
(b) Speed Boss: He has to ensure that the work is accomplished at the right time and according to the specified speed.
(c) Repair Boss: He is responsible for keeping machines and equipment in an efficient and working order.
(d) Inspector: He is responsible for the quality of work and brings a spirit of quality consciousness in the minds of the workers.

Q. 13. ‘Chennai Leather Ltd.’ is a manufacturer of leather products. It is producing on a large scale and its organisational structure is functional. In the production department, various foremen have been employed. Each foreman has been made responsible for production planning, implementation and control. This has led to a situation of confusion and uncertainty. Suggest a technique of scientific management to Chennai Leather Ltd. which may help it to effectively organise planning and its execution.
Ans. The technique of scientific management that may help Chennai Leather Ltd. to effectively organise planning and its execution is Functional Foremanship.
(i) Functional foremanship is a technique that aims to improve the quality of supervision on the shop floor.
(ii) Taylor identified a list of qualities of a good foreman or a supervisor. Since all the qualities could not be found in a single person, Taylor proposed eight specialists.
(iii) In this technique, planning is separated from execution. Taylor suggested four foremen for planning and four foremen for execution.
(iv) It is an extension of the principle of division of work and specialisation.
(v) The four foremen for planning were the route clerk, instruction card clerk, time and cost clerk and disciplinarian. The four foremen for planning would draft instructions for the workers, specify the route of production, prepare time and cost sheets and ensure discipline respectively.
(vi) The four foremen for execution were gang boss, speed boss, repair boss and inspector. The four foremen for execution were responsible for timely and accurate completion of the job, keeping machines and tools ready for operation by the workers, ensuring proper working conditions of machines and tools and checking the quality of work.

Long Answer Type Questions

Q. 1. Why principles of management are needed? Explain by giving any five reasons [Outside Delhi Comptt. Set I 2010]
OR
"Principles of Management, nowadays have become an integral part of all types of successful business organisations". In light of this statement, present your comments regarding the reasons why management principles are needed.
Ans. Following are the main five reasons that highlight the importance of management principles:
(i) Improves understanding: The knowledge of principles improves the understanding of the managers about the ways and means of managing an organisation.
(ii) Direction for the training of managers: The principles are helpful in identifying of management in which existing and future managers should be trained.
(iii) Optimum utilization: Management principles aim at the optimum utilization of human and physical resources for the attainment of organisational goals.
(iv) Meeting changing environment requirements: Management principles help managers to meet the changing requirements of the environment.
(v) Fulfilling social responsibility and research: Management principles are used as a basis for management training education and research.

Q. 2. Explain any four characteristics of 'Principles of Management.' [Delhi Set I, II, III 2016]
OR
Describe the nature of Principles of Management with the help of any four points. [Outside Delhi Set I, II, III 2016]
Ans. Characteristics/Nature of Principles of Management:
(i) Universal applicability: The principles of management are intended to apply to all types of organisations, business as well as non-business, small as well as large, public sector as well as private sector, manufacturing as well as the services sectors. However, the extent of their applicability would vary with the nature of the organisation, business activity, scale of operations, etc.
(ii) General guidelines: The principles are guidelines to action but do not provide ready-made and to-the-point solutions to all managerial problems. This is so because real business situations are very complex and dynamic and are a result of many factors. However, the importance of principles cannot be underestimated because even a small guideline helps to solve a given problem.
(iii) Formed by practice and experimentation: The principles of management are formed by experience and collective wisdom of managers as well as experimentation. For example, It is a matter of common experience that discipline is indispensable for accomplishing any purpose. This principle is mentioned in the management theory. On the other hand, to remedy the problem of fatigue of workers in the factory, an experiment may be conducted to see the effect of improvement of physical conditions to reduce stress.
(iv) Flexible: The principles of management are not rigid prescriptions, which have to be followed absolutely. They are flexible and can be modified by the manager when the situation demands. They give the manager enough discretion to do so.
(v) Mainly behavioural: Management principles aim at influencing the behaviour of human beings. Therefore, principles of management are mainly behavioural  It is not that these principles do not pertain to things and phenomena at all; it is just a matter of emphasis. Moreover, principles enable a better understanding of the relationship between human and material resources in accomplishing organisational purposes.
(vi) Cause and effect relationships: The principles of management are intended to establish a relationship between cause and effect so that they can be used in similar situations in a large number of cases. As such, they tell us if a particular principle was applied in a particular situation, what would be its likely effect? The principles of management are less than perfect since they mainly apply to human behaviour. In real life, situations are not identical. Therefore, accurate cause-and-effect relationships may be difficult to establish.
(vii) Contingent: The application of principles of management is contingent or dependent upon the prevailing situation at a particular point in time. The application of principles has to be changed as per requirements.

Q. 3. Explain Fayol’s principles of ‘equity’ and ‘order’ with examples. [Delhi Set II, Outside Delhi Set I 2011]
Ans. (i) Equity: Fayol advocated that there should be no discrimination against anyone on account of sex, religion, language, caste, belief, nationality, etc. and emphasised kindness and justice in the behaviour of the managers towards the workers to ensure loyalty and devotion. For example, nowadays, in multinational corporations, equal opportunities are available to everyone.
(ii) Order: Fayol advocated that people and resources must be in suitable places at appropriate times for maximum efficiency i.e., there should be a place for everything and everyone in an organisation and that thing or person should be found in the allotted place. This will lead to increased productivity and efficiency. For example, Raw material should be available at the place prescribed for it.

Q. 4. Explain the following principles of Fayol with the help of one example of each:
(i) Initiative
(ii) Espirit de Corps. [Delhi Comptt. Set III 2011]
Ans. (i) Initiative: Fayol wanted that subordinates should be allowed to take some initiative in making and executing the plans. Employees get satisfaction when they are allowed to take initiative. Initiatives on their part can be a great source of organisational strength. For example, Before setting up the plan, the manager must welcome the suggestions and ideas of their employees to allow their maximum participation. However, once the plan is made, every employee must follow and implement it.
(ii) Espirit de Corps: According to this principle, the management should take responsible steps to develop a sense of belongingness and a feeling of team spirit among employees. To achieve the best possible results, individual and group efforts need to be effectively integrated and coordinated. Management must infuse the team spirit in the workers. It develops an atmosphere of mutual trust and understanding among employees and minimises the need for penalties for default. A manager should replace ‘I’ with ‘We’ in his conversations to promote the spirit of teamwork. For example, If a department has to achieve a target, then according to this principle, each member of the department must ensure that the target is achieved on time, even if any member is unable to fulfil his/her target. It means that employees should not concentrate only on achieving their targets but on achieving group targets.

Q. 5. Explain the following principles of management given by Fayol:
(i) Unity of Command
(ii) Order. U [SQP 2015]
Ans. (i) Unity of Command: According to the principle of unity of command, an individual employee should receive orders from only one superior at a time and that employee should be answerable only to that superior. If there are many superiors giving orders to the same employee, he will not be able to decide as to which order is to be given priority. He thus finds himself in a confused situation. Such a situation adversely affects the efficiency of the subordinates. On the other hand, when there are many superiors, every superior would like his orders to be given priority. This ego problem creates a possibility of clash. Consequently, their efficiency is likely to be affected.
(ii) Order: According to the principle of order, the right person should be placed at the right job and the right thing should be placed at the right place. According to Fayol, every enterprise should have two different orders-Material Order for Physical Resources and Social Order for Human Resources. Keeping the physical resources in order means a proper place for everything and everything in its right place. Similarly, keeping the human resources in order means a place for everyone and everyone in his appointed place. Maintaining these two orders properly will ensure that everybody knows his workplace, what he is to do and from where he would get his required material. Consequently, all the available resources in the organisation will be utilised properly.