Worksheet Solutions: Principles of Management | Business Studies (BST) Class 12 - Commerce PDF Download

Multiple Choice Questions

Q1: Which of the following is not a function of management?
(a) Planning
(b) Controlling
(c) Producing
(d) Organizing
Ans: (c)

Q2: Who introduced the concept of scientific management?
(a) Frederick Taylor
(b) Henri Fayol
(c) Max Weber
(d) Elton Mayo
Ans: (a)

Q3: Which principle of management emphasizes harmony and unity among the employees?
(a) Unity of Command
(b) Unity of Direction
(c) Esprit de Corps
(d) Division of Work
Ans: (c)

Q4: SWOT analysis stands for:
(a) Strengths, Weaknesses, Opportunities, Threats
(b) Strategies, Weaknesses, Opportunities, Tactics
(c) Strengths, Workforce, Objectives, Timelines
(d) Strategies, Workforce, Objectives, Threats
Ans: (a)

Q5: What is the first step in the process of decision-making?
(a) Identifying the problem
(b) Implementing the decision
(c) Evaluating the decision
(d) Generating alternatives
Ans: (a)

Very Short Answers

Q1: Define the concept of 'Span of Management.'
Ans: Span of Management refers to the number of subordinates a manager can effectively supervise. It can be narrow (few subordinates) or wide (many subordinates) based on the organization's structure and complexity.

Q2: Briefly explain the term 'Scalar Chain.'
Ans: Scalar Chain is a chain of authority and communication in an organization. It suggests the line of authority from top to bottom and establishes a direct link between superiors and subordinates.

Q3: What is the importance of 'Equity' in the principles of management?
Ans: Equity ensures fairness and justice in dealing with employees. It promotes a sense of belonging and trust among the employees, leading to a positive work environment.

Q4: Differentiate between 'Policy' and 'Procedure.'
Ans: Policies are broad guidelines that define the course of action in an organization, while procedures are specific steps or methods to achieve a particular task within the framework of policies.

Q5: Mention any two advantages of Management by Objectives (MBO).
Ans: (i) Clear goal setting and
(ii) Performance evaluation based on objectives.

Short Answers 

Q1: Explain the concept of 'Fayol's Principles of Management' with any three principles.
Ans: Division of Work: Work should be divided among individuals and groups to ensure specialization and efficiency.
Authority and Responsibility: Authority gives the right to give orders, and responsibility ensures that tasks are accomplished as expected.
Unity of Direction: Activities within the organization that have the same objective should be directed by one manager using one plan.

Q2: Discuss the importance of 'Planning' in the management process.
Ans: Goal Setting: Planning helps in setting clear objectives and goals for the organization.
Decision Making: It provides a basis for decision-making by evaluating various alternatives.
Resource Allocation: Planning helps in allocating resources effectively, ensuring their optimum utilization.

Q3: Describe the steps involved in the 'Controlling' function of management.
Ans: Establishing Standards: The first step is to establish performance standards based on organizational goals.
Measuring Performance: Actual performance is measured against the established standards.
Comparing Performance: The measured performance is compared with the standards to identify deviations.
Taking Corrective Action: If there are significant deviations, corrective actions are taken to bring performance back on track.

Q4: What is 'Coordination' in the context of management? Why is it essential?
Ans: Coordination refers to the integration and synchronization of activities, ensuring that different parts of the organization work together towards common goals. It is vital because it helps in avoiding conflicts, ensuring smooth workflow, and achieving organizational objectives efficiently.

Q5: Explain the 'Hawthorne Effect' and its implications for management.
Ans: The Hawthorne Effect refers to the phenomenon where individuals improve their performance due to the attention and interest they receive from researchers or supervisors. Implications for management include recognizing the importance of employee morale, motivation, and job satisfaction, as they directly impact productivity and organizational outcomes.

Long Answers 

Q1: Explain the steps involved in the process of Decision Making.
Ans: Identifying the Problem: The first step is to recognize and define the problem or decision that needs to be addressed.
Gathering Information: Relevant data and information are collected to understand the problem thoroughly.
Generating Alternatives: Various solutions or alternatives are brainstormed and evaluated.
Evaluating Alternatives: Each alternative is assessed based on its pros and cons, considering the potential outcomes.
Making the Decision: The best alternative is chosen, and a decision is made.
Implementation: The decision is put into action, and necessary steps are taken to execute the chosen alternative.
Follow-up: The decision's outcomes are monitored, and adjustments are made if required.

Q2: Discuss the significance of 'Teamwork' in modern organizations.
Ans: Enhanced Creativity: Diverse perspectives in a team lead to innovative ideas and creative solutions to problems.
Improved Efficiency: Tasks are divided among team members, leading to faster and more efficient completion.
Better Decision Making: Collective decision-making involves considering various viewpoints, leading to well-informed decisions.
Higher Morale: Collaboration and mutual support boost employee morale and job satisfaction.
Adaptability: Teams can quickly adapt to changing situations and challenges, ensuring organizational flexibility.

Q3: Explain the concept of 'Centralization' and 'Decentralization' in organizational structure. Provide examples of each.
Ans: Centralization: Centralization refers to the concentration of decision-making authority at the top levels of an organization. In a centralized structure, key decisions are made by top management. For example, small businesses often have centralized decision-making, where the owner or a small group of executives make all significant decisions.
Decentralization: Decentralization, on the other hand, involves the delegation of decision-making authority to lower levels in the organization. For instance, large corporations may decentralize certain functions to regional branches or departments, allowing them to make decisions tailored to local needs and market demands.

Q4: Examine the challenges faced by managers in the global business environment.
Ans: Cultural Diversity: Managers must navigate diverse cultures, languages, and customs, understanding the impact on business practices.
Communication Barriers: Language differences and communication styles can lead to misunderstandings and misinterpretations.
Legal and Regulatory Differences: Each country has distinct laws and regulations governing businesses, necessitating compliance and adaptation.
Supply Chain Disruptions: Global events, like natural disasters or political unrest, can disrupt the supply chain, affecting production and delivery.
Market Competition: Managers face intense global competition, requiring strategic planning and differentiation to succeed in the market.

Q5: Explain the concept of 'Management by Objectives (MBO).' What are its advantages and limitations?
Ans: Concept: MBO is a goal-oriented approach where employees and managers collaboratively set specific, measurable, attainable, relevant, and time-bound objectives. Progress is regularly monitored, and performance is evaluated based on these objectives.
Advantages:
Clear Goals: MBO provides clarity regarding individual and organizational goals, ensuring alignment with the overall objectives.
Performance Evaluation: Employees' performance is measured objectively, enhancing accountability and motivation.
Employee Involvement: Employees actively participate in goal-setting, fostering a sense of ownership and commitment.
Enhanced Communication: Regular feedback and communication between managers and employees lead to improved understanding and cooperation.
Limitations:
Complexity: Implementing MBO requires careful planning and coordination, which can be challenging in large organizations.
Overemphasis on Goals: Excessive focus on achieving objectives might lead employees to neglect other essential aspects of their roles.
Resistance to Change: Employees might resist MBO if they perceive it as an additional burden or a threat to their autonomy.

Case-Based Questions

Q1: Case 1: XYZ Company
XYZ Company, a leading electronics manufacturer, has been facing a decline in sales and customer satisfaction. Analyze the situation and answer the following sub-questions:
Identify two possible reasons for the decline in sales at XYZ Company.
Ans: Market Saturation: The electronics market might be saturated, leading to intense competition and reduced sales opportunities.
Outdated Product Line: XYZ Company's products might be outdated, lacking the features or innovations that appeal to modern consumers.

Q2: Suggest two strategic measures XYZ Company can take to improve customer satisfaction.
Ans: Enhance Product Quality: Focus on improving the quality of products to meet or exceed customer expectations, ensuring reliability and durability.
Implement Effective Customer Support: Establish a responsive customer support system to address customer queries, complaints, and issues promptly, fostering positive customer experiences.

Q3: Discuss the role of effective leadership in revitalizing XYZ Company's business.
Ans: Visionary Leadership: A visionary leader can set clear goals and inspire the team, providing a direction for the company's revival efforts.
Change Management: Effective leaders can manage organizational change, encouraging innovation, and implementing strategic initiatives to adapt to market demands.

Q4: Case 2: ABC Corporation
ABC Corporation, a global software development firm, is experiencing internal conflicts among teams, hindering collaboration and project progress. Analyze the situation and answer the following sub-questions:
Identify two potential causes of internal conflicts at ABC Corporation.
Ans: Communication Breakdown: Inadequate communication channels or misunderstandings can lead to conflicts among teams with different project information or expectations.
Resource Allocation Issues: Unequal distribution of resources, such as workloads or project assignments, can create conflicts and resentment among employees.

Q5: Propose two conflict resolution strategies that ABC Corporation can implement to address the internal conflicts.
Ans: Mediation: Introduce a neutral mediator to facilitate communication and negotiation between conflicting parties, helping them reach a mutually agreeable solution.
Team Building Workshops: Organize team-building workshops and activities to improve collaboration, foster understanding, and build positive relationships among employees.

Q6: Explain the role of effective communication in preventing and resolving conflicts within organizations like ABC Corporation.
Ans: Clarity and Transparency: Clear communication ensures that team members understand expectations, roles, and responsibilities, minimizing misunderstandings that often lead to conflicts.
Active Listening: Encouraging active listening fosters empathy and understanding, allowing employees to address concerns and find common ground, reducing potential conflicts.

Q7: Case 3: LMN Enterprises
LMN Enterprises, a retail chain, is struggling to retain employees, leading to high turnover rates. Analyze the situation and answer the following sub-questions:
Identify two possible reasons for the high turnover rates at LMN Enterprises.
Ans: Lack of Career Development: Employees may leave if they perceive limited opportunities for career growth or skill development within the organization.
Inadequate Work-Life Balance: Excessive workload, long hours, or lack of flexibility in work schedules can lead to employee burnout and turnover.

Q8: Suggest two employee retention strategies that LMN Enterprises can adopt to reduce turnover rates.
Ans: Offer Training and Development Programs: Provide continuous learning opportunities, training, and skill enhancement programs to help employees grow professionally within the organization.
Improve Work-Life Balance: Implement flexible work schedules, remote work options, and policies promoting employee well-being to maintain a healthy work-life balance.

Q9: Discuss the significance of employee engagement in retaining staff at LMN Enterprises.
Ans: Increased Job Satisfaction: Engaged employees feel valued and satisfied, leading to higher job satisfaction and reduced inclination to leave the organization.
Higher Productivity: Engaged employees are more committed to their work, leading to increased productivity, quality of work, and customer satisfaction.
Positive Work Environment: Employee engagement fosters a positive work culture, where employees are motivated, collaborative, and contribute positively to the organization's growth.