principles of management important questions and answers for b.com students

VAIBHAV PRASAD H.M
1ST
SEMESTER
IMPORTANT QUESTIONS &
ANSWERS
FOR 1ST YEAR B.COM (1ST SEM)
BY-VAIBHAV PRASAD H.M

IMPORTANT QUESTION & ANSWERS
By VAIBHAV PRASAD H.M
Tumkur.
1. Explain the principles of management as per Hennery Foyal?
(Or)Explain principles of management.(08,09.10.11.12)
Foyal developed fourteen (14) of the management principles, which become more effective through
formal training in them. These principal were the explained in a book general industrial Management
published in 1916. They are the showed below :
Fayol's Principles of Management: The principles of management are given below:
1. Division of work: Division of work or specialization alone can give maximum productivity &
efficiency. Both technical & managerial Activities can be performed in the best manner only
through division of labor & specialization.
2. Authority & Responsibility: The right to give order is called authority. The obligation to
accomplish is called responsibility. Authority & Responsibility are the two sides of the
management coin. They exist together. They are complementary & mutually interdependent.
3. Discipline: The objectives, rules & regulations, the policies & procedures must be honored by
each member of an organization. There must be clear & fair agreement on the rules &
objectives, on the policies & procedures. There must be penalties (punishment) for non-
obedience or indiscipline. No organization can work smoothly without discipline - preferably
voluntary discipline.
4. Unity of Command: In order to avoid any possible confusion & conflict, each member of an
organization must received orders & instructions only from one superior (boss).
5. Unity of Direction: All members of an organization must work together to accomplish
common objectives.
6. Emphasis on Subordination of Personal Interest to General or Common Interest: This
is also called principle of co-operation. Each shall work for all & all for each. General or common
interest must be supreme in any joint enterprise.
7. Remuneration: Fair pay with non-financial rewards can act as the best incentive or
motivator for good performance. Exploitation of employees in any manner must be eliminated.
Sound scheme of remuneration includes adequate financial & nonfinancial incentives.
8. Centralization: There must be a good balance between centralization & decentralization of
authority & power. Extreme centralization & decentralization must be avoided
9. Scalar Chain: The unity of command brings about a chain or hierarchy of command linking
all members of the organization from the top to the bottom. Scalar denotes steps.
10. Order: Fayol suggested that there is a place for everything. Order or system alone can
create a sound organization & efficient management.
11. Equity: An organization consists of a group of people involved in joint effort. Hence, equity
(i.e., justice) must be there. Without equity, we cannot have sustained & adequate joint
collaboration.
12. Stability of Tenure: A person needs time to adjust himself with the new work &
demonstrate efficiency in due course. Hence, employees & managers must have job security.
Security of income & employment is a pre-requisite of sound organization & management.
13. Esprit of Co-operation: Esprit de corps is the foundation of a sound organization. Union is
strength. But unity demands co-operation. Pride, loyalty & sense of belonging are responsible
for good performance.
14. Initiative: Creative thinking & capacity to take initiative can give us sound managerial
planning & execution of predetermined plans.
2. Explain the process or the steps of planning.(09,10,11)
According to Fayol - "The plan of action is, at one & the same time, the result envisaged, the line of
action to be followed, the stages to go through, & the methods to use. It is a kind of future picture
wherein proximate events are outlined with some distinctness...."
Principles of Management

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The Planning process involves the following steps:
1. Analysis of External Environment: The external environment covers uncontrollable &
unpredictable factors such as technology, market, socioeconomic climate, political conditions etc.,
within which our plans will have to operate.
2. Analysis of Internal Environment: The internal environment covers relatively controllable
factors such as personnel resources, finance, facilities etc., at the disposal of the firm. Such an
analysis will give an exact idea about the strengths & weakness of the enterprise.
3. Determination of Mission: The "mission" should describe the fundamental reason for the
existence of an organization. It will give firm direction & make out activities meaningful &
interesting.
4. Determination of Objectives: The organizational objectives must be spelled out in key areas of
operations & should be divided according to various departments & sections. The objectives must
be clearly specified & measurable as far as possible. Every member of the organization should be
familiar with its objectives.
5. Forecasting: Forecasting is a systematic attempt to probe into the future by inference from
known facts relating to the past & the present. Intelligent forecasting is essential for planning. The
management should have no stone unturned Functions of Management in reducing the element of
guesswork in preparing forecasts by collecting relevant data using the scientific techniques of
analysis & inference.
6. Determining Alternative course of Action: It is a common experience of all thinkers that an
action can be performed in several ways, but there is a particular way which is the most suitable
for the organization. The management should try to find out these alternatives & examine them
carefully in the light of planning premises.
7. Evaluating Alternative Courses: Having sought out alternative courses & examined their
strong & weak points, the next step is to evaluate them by weighing the various factors.
8. Selecting the Best: The next step - selecting the course of action is the point at which the plan is
adopted. It is the real point of decision-making.
9. Establishing the sequence of activities: After the best programme is decided upon, the next
task is to work out its details & formulate the steps in full sequences.
10. Formulation of Action Programmes: There are three important constituents of an action
plan:
 The time-limit of performance.
 The allocation of tasks to individual employees.
 The time-table or schedule of work so that the functional objectives are Achieved within the
predetermined period.
11. Reviewing the planning process:
through feedback mechanism, an attempt is Made to secure that which was originally planned. To
do this we have to compare the actual performance with the plan & then we have to take necessary
corrective action to ensure that actual performance is as per the plan.
3. Write a note on “x” & “y” theory.(08,09,11,12)
Theory X
-A manager who fits into the theory X group leans towards an organization climate of close
controls centralize of the authorities, autocratic of the relationship & minimum participation in
the decision making process. Such manager accepts certain assumptions. Theories X
assumptions according to the Mc Gregor are.
 The average person dislikes work & will avoid it as much as possible.
 Stemming from this, according to the theory X, most people have to be forced or the
threatened by the punishment to the make the effort necessary to accomplish of the
organizational goals.
 The average individual is basically passive & therefore prefers to be directed, rather
than to assume any risk or the responsibility. Above all the else, Security is the important.

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Theory Y-A theory Y Manager of operates with a different set of the assumptions regarding
human motivation. This manager feels that an effective organizational climate has looser. More
genera super vision of the greater decent realization of the authority less reliance on coercion &
the control democratic leadership, style & more of the participation in the decision process. The
assumption upon which this type of the organization climate is based includes the following:-
 Work is a natural as play or the rest & therefore is not avoided.
 Self-motivation & inherent of the satisfaction in work will be forth common in the
situations where the individual is the committed to the organizational goals. Hence, coercion is
not the only from of the influence that can be of the used to motivate.
 Commitment is a crucial factor in the motivation & it is a function of the rewards coming
from it.
 The average individual learns to accept & even proper environment.
 Contrary to the stereotypes the ability to be creative & the innovation in the solution of
the organization problem is the widely, not narrowly, distributed in the population.
 In Modern business & organizations human interlaced potentialities are just practically
realize.
4. Explain the importance of planning.(09,10,11)
Importance of Planning: As a managerial function planning is important due to the following
reasons:-
1. To manage by objectives: All the activities of an organization are designed to Achieve certain
specified objectives. However, planning makes the objectives more concrete by focusing
attention on them.
2. To offset uncertainty and change: Future is always full of uncertainties and Changes.
Planning foresees the future and makes the necessary provisions for it.
3. To secure economy in operation: Planning involves, the selection of most profitable course of
action that would lead to the best result at the minimum costs.
4. To help in co-ordination: Co-ordination is, indeed, the essence of management, the planning
is the base of it. Without planning it is not possible to co-ordinate the Different activities of an
organization.
5. To make control effective: The controlling function of management relates to the comparison
of the planned performance with the actual performance. In the absence of plans, a
management will have no standards for controlling other's performance.
6. To increase organizational effectiveness: Mere efficiency in the organization is not
important; it should also lead to productivity and effectiveness. Planning enables the manager
to measure the organizational effectiveness in the context of the stated objectives and take
further actions in this direction.
5. What is planning & explain the steps involved in planning?(08,10)
Samuel Certo says: “Planning is the systematic development of the action programmers aimed at
reaching agreed business objective by the process of analyzing, evaluating & selecting among the
opportunities which are foreseen.”
Steps in Planning-
a) Establishing objectives-The first step in the planning is to establish or determine in the
definite term the objectives. Objective indicate basically what is to be accomplished & where the
primary emphasis is to be placed & what the police & procedures should be planning is to be the
work out in the details what is to the accomplished.
b) Communicably objectives-In the designing an the environment for the effective
performance of the work groups it is the imperative that people must know what they are
expected to the describe their personal business goals it is the likely that they have no objectives
at all.
c) Establishing planning premises-The third step in the planner is to determine the
relevant information that will be needed by the planner in the establishing & estimating the
plan. Planning premises provide a background on which all the attention of the planner
continuous to provide the boundary wall with in which the attention remains diverted

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d) Listing Alternation ways of the Reaching Objectives-
Under this step managers should list is many available alternation as possible are the reaching
the pre-planned the objectives. In this connective the planner must reduce by the preliminary
examination the number of the alternation to those missing the most fruitful possibilities or by
the mathematically eliminating the least promising ones.
e) Evaluating Alternative Cases-Having sought out alternative courses & examined their
strong & the weak points the fifth step is the evaluate them by the weighting the various factors
in the right of the promises & goals.
f) Establish Policies-Policies might be viewed as a board pathway with in which the
worked moves towards on the objectives when considering alternatives a worker can the
automatically exclude those matters that are outside the area designed as the acceptable by
organization policy
g) Selecting A Courses of the Action-The seventh step-selecting the coursed of the action
is the point at which a plan is the adopted the real point of the decision-making occasionally an
analysis & evolution of the alternation courses against objectives.
h) Putting plans into the action-Once place have been developed they are ready to be put
into the action. The plans should furnish the organization with the both long range & short the
range direction of the activity.
i) Establishing Budgets-The important step to give the plans a meaning is to the number
them by the converting them to the budgets are the expression of the expected in the numerical
terms. If done well budgets become a means of the auditing to getter the various plans & also
important stand against which planning progress can be measured.
j) Establishing Time Tables-Completion dates are the most important part of the any
schedule. Millipore’s are the created for the convenient intervals throughout the life of the
project so that the manager dose not suddenly realize at the manager that he major objectives
are only half realized.
k) Deciding on Standards-As a final step in the planning procures. It is important for the
manager to realize that the plan performance is measured. Consequently plans should be stated
in a measurable manner.
6. Write a note on :- (08,10,11,12)
 Span of control- One of the basic doctrines in the theory of the organization is the
principal of the span of management. The ability capability & the time of the managers are the
necessarily restricted by the biological & physical factors hence a manager cannot look after
manage or the control unlimited number of the people working under him. Consequently if the
someone wants effective management, than the number of the subordinates working under the
manager must be such which he can effectively handle. The theoretical justification for the
restricted Span of the Management was developed by A.G Gracie, the famous French
mathematician & the management consultant. He proved through a mathematical formula the
relationships between a manager & sub-ordinate working under him. This repaid increase in
relationship is so much fast that we call it in a geometrical progression Graciousness’ theory
explains that there is not one relationship between a manger & sub-ordinates that is -
controlled. Rather there are three different relationships that require proper attention of a
manager.
 Social responsibilities of Management-The social responsibility of Management: The
social responsibility of business refers to such decisions & activities of a business firm which
provides for the welfare of the society as a whole along with the earning profit for the firm. On
the other h& social responsibility refers to the obligations & duties of the business to the society.
 The theme of social responsibility is that
 A business firm should not ignore the welfare of the society.
 Policies & the business enterprise should focus on the values of the society.
 Earning profit by honoring values of the society & finally assists the promotion of
welfare of the society.

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7. Explain the importance organizing.
 Importance of Organizing: Performance of the organizing function can pave the way for
a smooth transition of the enterprise in Accordance with the dynamic business environment. The
significance of the organizing function mainly arises from the fact that it helps in the survival &
growth of an enterprise & equips it to meet various challenges. In order for any business enterprise
to perform tasks & successfully meet goals, the organizing function must be properly performed.
The following points highlight the crucial role that organizing plays in any business enterprise.
 Benefits of specialization: Organizing leads to a systematic allocation of jobs amongst the
work force. This reduces the workload as well as enhances productivity because of the specific
workers performing a specific job on a regular basis. Repetitive performance of a particular task
allows a worker to gain experience in that area & leads to specialization.
 Clarity in working relationships:
The establishment of working relationships clarifies lines of communication & specifies who is to
report to whom. This removes ambiguity in transfer of information & instructions. It helps in
creating a hierarchical order thereby enabling the fixation of responsibility & specification of the
extent of authority to be exercised by an individual.
 Optimum utilization of resources: Organizing leads to the proper usage of all material,
financial & human resources. The proper assignment of jobs avoids overlapping of work & also
makes possible the best use of resources. Avoidance of duplication of work helps in preventing
confusion & minimizing the wastage of Resources & efforts.
 Adaptation to change: The process of organizing allows a business enterprise to
accommodate changes in the business environment. It allows the organization structure to be
suitably modified & the revision of interrelationships amongst managerial levels to pave the way
for a smooth transition. It also provides much needed stability to the enterprise as it can then
continue to survive & grow in spite of changes.
 Effective administration: Organizing provides a clear description of jobs & related duties.
This helps to avoid confusion & duplication. Clarity in working relationships enables proper
execution of work. Management of an enterprise thereby becomes easy & this brings effectiveness
in administration.
 Development of personnel: Organizing stimulates creativity amongst the managers.
Effective delegation allows the managers to reduce their workload by assigning routine jobs to
their subordinates. The reduction in workload by delegation is not just necessary because of
limited capacity of an individual but also allows the manager to develop new methods & ways of
performing tasks. It gives them the time to explore areas for growth & the opportunity to innovate
thereby strengthening the company’s competitive position. Delegation Also develops in the
subordinate the ability to deal effectively with challenges & helps them to realize their full
potential.
8. Explain the Maslow’s heriechey needs.(09,10,11,12)
Hierarchy of needs theory It is developed by Abraham Maslow. Maslow hypothesized that within
every human being, there exists a hierarchy of five needs:
1. Physiological: Includes hunger, thirst, shelter etc.
2. Safety: Security and protection from physical and emotional harm.
3. Social: Affection, belongingness, acceptance and friendship.
4. Esteem: Internal factors such as self-respect, autonomy, achievement and external factors
such as status, recognition and attention.
5. Self-actualization: Drive to become what one is capable of becoming includes growth,
achieving one’s potential and self-fulfillment.
As each of this needs becomes substantially satisfied, the next needs becomes dominant.
 Maslow divide this five needs into higher and lower order needs.
Lower-order needs –
 Physiological, safety, and social needs.
 Desires for physical and social well being.

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Higher-order needs –
 Esteem and self-actualization needs.
 Desire for psychological growth and development
9. Differentiate between Administration & Management(08,09,11)
Points of Destination Administration Management
1.Nature of work Thinking function or
its primarily
concerned with the
determination of
objectives & broad
policies.
It’s a doing function. It
involves the
implementation of
plans & policies
2.Scope It takes major
decisions & is a wider
term than
management.
It takes the decision
within the frame work
of administration.
3.Level of Authority It is a top management
function.
It is a lower level
management function
4.Status It consists the owner of
the enterprise.
It consists of the
managerial personnel
with specialized
knlowdeged who may
be the employee.
5.Nature of
Organization
Generally it is used in
relation to
government, military,
educational &religious
organization.
Used in mainly
business firms which
have economic
motives.
6.Influence Its decisions are
generally influenced
by external factors
such as social political
legal etc.
Its decisions are
influenced by internal
factors such as values,
beliefs &opinions.
10.Explain the Difference between formal & informal organization(09)
Formal organisation-
a) It is prescribed structure of roles & relationships consciously co-ordinated towards
common goal.
b) The goals are oriented towards productivity, profit & growth.
c) It is hierarchical & usually pyramid shaped.
d) It emphasises on status differentials & based on superior-subordinate relations.
e) It has a prescribed system of behaviour .people are rewarded for their desired behaviour
& punished for their undesirable behaviour .rewards may be both monetary & non-monetary.
Informal organisation
a) It is natural spontaneous structure arising out of personal & social relations of people.
b) Its goals & tasks are predominately centred around individual & group affliction,
satisfaction friendship.
c) It is shapeless.
d) It is based on friendship, common values & interest.
e) It has unwritten norm of behaviour enforced by common consent by all the members.
Rewards for obeying the norms can take the form of continuous membership, esteem,
leadership etc.

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11. What is Decision Making? Explain the steps in Decision making. (08)
“ Decision-making is the process of selecting the best alternative course of action from among a
number of alternatives given to management or developed by it- after carefully and critically
examining alternative”
Steps involved in decision making:-
• Definition of the decision-making problem- The first step in decision making process is to define
decision making problem i.e. Discrepancies between a current state of condition and what is
desired.
• Collection of data – A decision is as good as adequacy and quality of data is on which it is based.
Accordingly, management should proceed to collect necessary data, and for these services of MIS is
very useful.
• Development of alternatives – This step is usually guided by SWOT analysis.
• Selection of the best alternative- Selection of best alternatives is based on ,
1. Experience 2. Experimentation
• Implementation of the decision –
A decision is remains only a “paper decision “unless and until it is put into practice.
Implementation of decision requires following
Managerial aspects:
 Communication
 making all resources and facilities
 motivating
 Exercising general supervision.
• Follow-up or feedback action – After decision has been put into practice, the Management must
watch consequences- this is follow up or feedback aspect of decision making process. In the view of
feedback obtained from implementation of decision, necessary modification can be made in the
decision.
12. Define Organization and Types of Organization.(09,10,11,12)
According to Louis. A. Allen “Organization is the process of identifying and grouping of the work to
be performed, defining and delegating responsibility and authority and establishing relationship
for the purpose of achieving organization goals”.
Types of Organization.
 Line organization - The person having greater decision-making authority are placed at the top,
and those having the least decision-making authority are placed at the bottom.
Kinds of line organization –
1. Pure line organization
2. Departmental line organization
 Pure line organization: The entire individual perform the same type of work but for better control
and supervision they may be divided into different groups, each placed under the charge of a
foreman.
 Departmental line organization:-Under this there are number of departments which comes under
the control of the chief executive at the top. All the heads derives his authority from the general
manager and delegate’s authority to his immediate subordinates.
(II.) Line and Staff Organization:
It is one, in which there is basic departmentation for primary business functions, operated on the
concept of the scalar chain; and there is a provision for specialized activities performed through
staff officers, the latter acting ordinarily in an advisory capacity.
(III.) Functional organization: A functional organization is one where all the
activities of the business are divided based on the function and entrusted to a specialist. Like
production, marketing, finance, personnel, research.
(IV.) Project organization: A project organization is one, in which a project structure is created as a
separate unit or division within a permanent functional structure; drawing specialists and
workers from various functional departments who work under the overall leadership, control and
co-ordination.

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(V.) Matrix organization: It is referred to as the “multiple command system” has two chains of
command. One chain of command is functional, in which the flow of authority is vertical. The
second chain is horizontal depicted by a project team which is led by the project or group manager
who is an expert in team’s assigned area of specialization.
(VI.) Committee organization: A committee means a group of persons formed for a stated purpose.
It may be a standing committee, or convened for a special purpose.
13. What is Line& Staff organization? Explain its merits & demerits.(08,10)
Line & staff org., the work of administration of business units is divided into two bead categories
, namely ,the ‘staff’ which is responsible for planning the ‘line’ for actual execution of work. Staff
officers are attached to line managers to advice in the area of their specialization. They are
advisors. The staff personnel prepare plans & recommend to the line officials who implement
them. The line officers may or may not rely on their advice. Thus, in simple terms, it can be
concluded that, “staff members are thinkers while the line officials are doers”.
Merits-
 It facilitates the workers to work faster & better.
 Specialization is attained when the staff officers concentrate on planning function & the
line officers concentrate on execution function.
 It enables the organization effectively utilize the staff officers experience & advice.
 The line officers can take sound decision whit the help of proper advice from the staff
officers.
 The new technology or a new procedure can be introduced in the org., with out any
dislocation.
 A new variety of responsible jobs can be given to skilled workers.
Demerits-
 If the powers of authority pertaining to the line officer & staff officers are not clearly
defined, there may be confusion through-out the org.,
 It is very difficult to control the line officer’s to when they reject the advice of the staff
officers.
 The line officers may reject the advice without assigning any reasons for their action.
 The staff officers may under-estimate the authority of line officers. The reason is that
they are superior to the line officers.
 The staff officers are not involved in the actual implementation of the program. So, it is
not obligatory on their part to give advice with care & caution.
 The staff officers are not responsible if favorable results are not obtained.
13. Briefly explain the control processes. Or Define Steps in the Control Process. & explain
the essentials of good control system.(09,11)
 Steps in the control process.
1. Establish Standards
a. Control standard—a target against which subsequent performance will be compared.
i. Control standards should be expressed in measurable terms.
ii. Control standards should be consistent with organizational goals.
iii. Control standards should be identifiable indicators of performance.
2. Measure Performance
a. Performance measurement is an ongoing process.
3. Compare Performance Against Standards
a. Define what a permissible deviation from the performance standard is.
b. Utilize the appropriate timetable for measurement.
4. Consider Corrective Action
a. Maintain the status quo (do nothing).
b. Correct the deviation to bring operations into compliance with the standard.
c. Change the standard if it was set too high or too.

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 Essentials of good control system.
a) Future oriented- the controlling system should help future planning activities of an
enterprise. The control system should ensure that mistakes made in the past are not
repeated.
b) Reflect organizational needs-the control used should be such that they are
appropriate to measure actual performances detect deviations and take correct
measures. The various control techniques like budgets statically charts.
c) Right people to monitor- controls must be designed so that the right people monitor.
The activities of their own field like sales, marketing, productions human resource,
finance a/c’s & so on. That is people with specialization & diversified fields should
monitor.
d) Control should be economically realistic-a control system must be worth the
expenditure. The cost of implementing the control system must be less than the
benefits desired from the control system.
e) Positive environment- controls used should create a positive environment &
motivate both the controller & the controlled. There should be scope for workers
innovativeness & creativity.
14. Is ‘Management is both a Science as well as an Art’ Discuss.(09,10,11)
 Science may be described- "as a systematic body of knowledge
Pertaining to an area of study & contains some general truths
Explaining past events or phenomena".
Management as Science
 Management uses principles, concepts of laws, economics, psychology etc.
 Concepts & meanings should be clear in science and the same applies for mgt.
 No empirical conformation like science.
 Like science taking a factor as static is not possible in mgt.
 'Art' refers to "the way of doing specific things; it indicates how an
Objective is to be achieved." Management like any other operational
activity has to be an art. Most of the managerial acts have to be
Cultivated as arts of attaining mastery to secure action & results.
Management as Art.
 Like arts, mgt involves the use of know-how & skills.
 Both are directed towards achieving concrete results.
 Mgt is creative like arts.
 Mgt is personalized like arts.
 Therefore Management is both a science as well as an art. The science of management
provides certain general principles which can guide the
Managers in their professional effort. The art of management consists in tackling every situation in
an effective manner. As a matter of fact, neither science should be over-emphasized nor art should
be discounted; the science & the art of management go together & are both mutually
interdependent & complimentary. Management is thus a science as well as an art. It can be said
that-"the art of management is as old as human history, but the science of management is an event
of the recent past."
15. What is decentralization? What are the various factors influencing the
centralization and decentralization?(08,09,10)
Decentralization -
Decentralization is the policy of delegating decision making authority throughout the
organization, relatively away from central authority.
Factors-
 Centralization -
• Stable environment.
• Low capability of lower level managers to take decision as top level managers.
• Decisions are significant.

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• Company is large.
• Organization is facing a crises or the risk of company failure.
 Decentralization -
• Environment is complex, uncertain.
• Lower-level managers are capable and experienced at making decisions.
• Decisions are relatively minor.
• Corporate culture is open to allowing.
• Company is geographical dispersed.
16. Explain the roles of a Manger (or) Explain the Managerial roles.(09,11)
Managerial Roles are:
A role is a set of specific tasks a person performs because of the position they hold.
Roles are directed inside as well as outside the organization.
There are 3 broad role categories:
1. Interpersonal
2. Informational
3. Decisional
1. Interpersonal Roles - Roles managers assume to coordinate and interact with employees and
provide direction to the organization.
• Figurehead role: symbolizes the organization and what it is trying to achieve.
• Leader role: train, counsel, mentor and encourage high employee performance.
• Liaison role: link and coordinate people inside and outside the organization
to help achieve goals.
2. Informational Roles - Associated with the tasks needed to obtain and transmit information for
management of the organization.
• Monitor role: analyzes information from both the internal and external
environment.
• Disseminator role: manager transmits information to influence attitudes and behavior of
employees.
• Spokesperson role: use of information to positively influence the way
people in and out of the organization respond to it.
3. Decisional Roles - Associated with the methods managers use to plan strategy and utilize
resources to achieve goals.
• Entrepreneur role: deciding upon new projects or programs to initiate and invest.
• Disturbance handler role: assume responsibility for handling an
unexpected event or crisis.
• Resource allocator role: assign resources between functions and divisions, set budgets of
lower managers.
• Negotiator role: seeks to negotiate solutions between other managers,
unions, customers, or shareholders.
17. What is MBO? Explain its features, process and types.
Management by objectives (MBO)-Management by objectives term was first popularized by Peter
Ducker in 1954. Management by objectives is a process whereby the superior & subordinates
managers of an organization jointly identify its common goals.
According to George S. Ordiorne - “MBO is a process whereby the superior and subordinate
manager of an organization jointly identifies its common goals. Define each individual’s major
areas of responsibility. In terms of result expected of him, and use these measures as guides for
operating the unit and assessing the contribution of each of its members”.
Features of MBO –
a) MBO is concerned with goal & planning for individual managers & their units.
b) The essence of MBO is a process of joint goal between a supervisor and a subordinate.
c) Managers work with their subordinates to establish the performance goals that are
consistent with higher organizational objectives.

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d) MBO focuses attention on appropriate goals & plans.
e) MBO facilitates control through the periodic development & subsequent evaluation of
individual goals and plans.
Process of MBO –
1. Preliminary setting of objectives at the top management level
2. Clarification of organizational roles
3. Setting the individual objectives
4. Matching goals with resources
5. Performance appraisal
Types of Objectives -
a) Strategic objectives - set by and for top management of the organization that address
broad, general issues.
b) Tactical objectives - set by and for middle managers; their focus is on how to
operationalize actions to meet strategic objectives.
c) Operational objectives - set by and for lower-level managers to address issues associated
with tactical objectives.
18. Discuss line and staff concept and explain the ways to avoid line and staff conflict
Line and Staff Organization is one, in which there is basic departmentation for primary business
functions, operated on the concept of the scalar chain; and there is a provision for specialized
activities performed through staff officers, the latter acting ordinarily in an advisory capacity.
 Line and staff conflict - Generally staff people are relatively young, better educated and
more sophisticated in appearance. They also suffer the notion that their ideas, if implemented, will
produce miraculous result.
 Complaints of line against staff.
• Line personnel view their staff counterparts as a source of irritation because the advice and
recommendations may involve change in the status.
• The ideas, suggestions or recommendations by the staff are theoretical and Impractical.
• Many a times, staff officials render untimely advice
• Staff people steal the credit for the successful ideas while blame for the failure against line.
• There is lack of authority, for the staff.
• Line people resist new ideas of the staff.
• Line officials consult the staff only as a matter of last resort
 Suggestions for resolving line-staff conflict.
 There must be clear definition of the authority, responsibility, areas and manners of
functioning of line and staff officials.
 Staff must appreciate the problem of line and line must be made to listen to the staff.
 There must be open channels of communication between the line and staff for transmission
of understanding and betterment of human relations.
 Proper use of the staff—line officers are dependent on staff officers for solving the problems
which require expertise knowledge and the skill.
 Setting congenial organizational climate—congenial organizational climate full of mutual
trust, respect, Self-restrain and control, coordinated approach and mutual help is another
important factor for successful operation of line and a staff personnel.
19.“Communication is the essence of management”. Discuss . (10,11,12)
Yes management is the art of getting thing done through or with people. Because other resources
that are money, material, machinery, methods etc. can’t fulfill the purpose of organizational
objectives, until and unless the main resources can’t be dealt well so management.
 Nature –
1. It is purposive activity - management is always aimed at achieving certain specified objectives.
It is a tool which helps efficient use of human and physical resources to accomplish the
predetermined goals.

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2. Management is pervasive i.e. primary in nature - Its activities aren’t restricted to business units
alone but in every kind of organization. Its procedure is compulsory whenever more than one
person is required or engaged in working for a common.
3. It is a continuous process - No day can come when organization can say that it doesn’t need
management. As business in dynamic in nature so the problems arises every day management is
required for solution of day to day affairs of business.
4. It is universal activity - It is neither confined to any geographical boundaries not to any
establishment not to any establishment ate business organization.
 Directing is dynamic and continuing functions.
 It initiates organized & planned action.
 It provides a link between various managerial functions of planning, organizing and
controlling.
 It’s a universal function.
 It is considered with human relationship.
 It motivatvates commands, communicate, supervises the staff and controls the
organization.
20. Explain the different sources of recruitments.(10,11)
a) Internal sources-the employees already working in the organization may be more suitable for
higher jobs than these recruitments from outside. Internal sources are discussed as follows-
I. Transfers:-it involves shifting of persons from present jobs to other similar places. These do
not involve any change in rank, responsibility & prestige.
II. Promotions:- it refers to shifting of persons to positions carrying better prestige , higher
responsibility , & more salaries. The higher positions falling vacant may be filled up from
within the organization.
III. Present employees:-the present employees’ off an organization may be informed about likely
vacant positions. The employees recommend their relations or persons intimately known to
them.
b) External sources: - every enterprise has to use external sources for recruitments to higher
positions when existing employees are not suitable.
I. Advertisement-through newspapers, magazine, poster, internet, and the ads will be given to
evaluate themselves against the recruitments of jobs.
II. Employment exchanges: it is run by the government unemployed persons get themselves
register with these exchanges; the vacancies may be notified with the exchange’s whenever
there is a need. The exchange supplies a list of candidates fulfilling required qualifications.
III. Educational intuitions’- the jobs in trade industry are becoming technical and complex. these
jobs require certain amount of educational & technical qualification . the employees exchange
information with universities & technical intuitions .the students are spotted during the course
of their studies.
IV. Unassociated applicants- person in search of employment may contact employers through
telephone, by post or in person. Generally employer with good reputation gets un-solicited
applications. If an opening is therefore is likely to be there then these persons are considered
for such jobs.
V. Labor contractors- it is quite common to engage contractors for the supply of labor. When
workers are require for short period & are hired without going through the full procedure of
selection etc. contractors or jobbers are the best source of getting them.
21. Explain any 5 characteristics of management.(08,09,10,11,12)
CHARACTERISTICS OF MANAGEMENT
An analysis of the various definitions of management indicates that
Management has certain characteristics. The following are the salient
Characteristics of management.
1. Management aims at reaping rich results in economic terms:
Manager's primary task is to secure the productive performance through Planning, direction
and control. It is expected of the management to Bring into being the desire results. Rational

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utilization of available Resources to maximize the profit is the economic function of a
manager. Professional manager can prove his administrative talent only by economizing the
resources and enhancing profit
2. Management also implies skill and experience in getting things
done through people: Management involves doing the job through
people. The economic function of earning profitable return cannot be
performed without enlisting co-operation and securing positive response from "people".
Getting the suitable type of people to execute the operations is the significant aspect of
management.
3. Management is a process: Management is a process, function or activity. This process
continues till the objectives set by administration are actually achieved. "Management is a
social process involving co-ordination of human and material resources through the functions
of planning, organizing, Staffing, leading and controlling in order to accomplish stated
objectives".
4. Management is a universal activity: Management is not applicable to business undertakings
only. It is applicable to political, social, religious and educational institutions also.
Management is necessary when group effort is required.
5. Management is a Science as well as an Art: Management is an art because there are definite
principles of management. It is also a science because by the application of these principles
predetermined objectives can be achieved.
22.Explain the nature /characteristics of Direction.(11)
a) It is a dynamic function- a manager has to continuously direct ,m guide , motivate & lead his
subordinates. With change in plans & organsational relationships, he will have to change the
methods and directions & techniques
b) It initiates actions.-directing initiates organized & planned action & ensures effective
performance by sub-ordinates towards the accomplishment of group activities. It is regarded
as the essence of management in action.
c) It provides necessary link between various managerial function-directing link to the various
managerial functions of planning , organizing, staffing, & controlling. Without directing the
function of controlling will never arise & the other preparatory functions of management will
become meaningless.”Nothing happens until the bus automobile is put into gear & the
accelerator pressed”.
d) It is universal function-all managers have to guide , motivate , lead, supervise & communicate
with their sub-ordinates.
e) Its concerned with human relationship-directing creates co-operations among the members of
the group. It seeks to achieve orderly arrangement of group effort to provide unity of action in
the pursuit of common objectives.
23.Explain Leader, Qualities of a Leader,& Types-
leader- is an individual who will be instrumental in guiding the efforts of group of the worker. To the
achievement of goals & objectives both of the individual of the organization
I. Quality of a good leader
a) good personality-punctual, knlowdgeable.
b) Emotional stability-concern, feeling towards workers.
c) Sound education & professional competence.
d) Initiates & creative thinking-innovate ideas
e) Sense of purpose and responsibility.
f) Ability to guide and teach.
g) Good understanding and sound judgments.
h) Communicating skills
i) Social able- mingle, helping nature, positive attitude.
j) Objective & flexible approach.
k) Honesty & integrity of character.

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l) Self-confidence.
m) Courage to accept responsibility-to face un-certainty.
II. Leadership types-
a) Autocratic leader-the leader expect complete obedience from his subordinates and all
decision making is centralized in the leader. All decision major or small are taken by the
leader & sub-ordinates are forced to obey them without questioning.
b) Laissez leader-under this type of leadership maximum freedom is allowed to sub-
ordinates they are given free hand in deciding their own policies & methods & take
there own decision. The leader provides help only when required by the sub-ordinates
otherwise he does not interfere in there work.
c) Democratic leader-under this type the leader act according to the mutual consent & the
decision are reached often consulting the sub-ordinates.
d) Bureaucratic leader-in this style everything is influenced by the rules regulations and
procedures. The leader setup a procedure ordering to the rule book. All the decision are
taken on the basis on the rules & regulation. The employees are not encouraged to take
the initiatives.
e) Manipulative leader-the employees are exploted through different means for extract in
more & more work from them & not compensating them for there additional efforts.
 When the co-operation of employees is needed urgently for specific task.
 When the projects are of short duration.
 When long term relationship may not be required.
f) Paternalistic leader-it is based upon the sentiments and emotions of people. A
paternalistic leader is like a father figure to the sub-ordinates . the leader looks after
the needs & aspirations of sub-ordinates. He helps guides & protects all of his sub-
ordinates.

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