Business Studies: CUET Mock Test - 9 - Commerce MCQ

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.

Responsibility can not be delegated but authority and accountability can be delegated. Responsibility means the work assigned to an individual. Authority means the power to take decision. Accountability means subordinates will be answerable for the non-completion of the task. Accountability can not be passed or delegated.

Process of Organising – Determination of Objectives, Division of Activities, Grouping of Activities, Defining Authority and Responsibility, Reviewing and Reorganising.
So, the first step of the process of organizing is Determination of Objectives: Organisation is established for some objective. Overall tasks or activities of the organisation are determined to achieve this goal.

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.

Responsibility means state of being accountable or answerable for any obligation. Authority and responsibility are closely related and this principle states that these two must go hand in hand. It means that proper authority should be delegated to meet the responsibilities.

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.

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.

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.

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

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.

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.

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.

Decentralization will lead to hand over the powers to the subordinate.This will give them to make their most participation in the organisation by contributing their performance of given works.

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.

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.

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.

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.

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.

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.

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.

Span of control is the term now used more commonly in business management, particularly human resource management. Span of control refers to the number of subordinates a supervisor has.

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.