We have given these Business Studies Class 12 Important Questions Chapter 2 Principles of Management to solve different types of questions in the exam. Go through these Principles of Management Class 12 Important Questions and Answers & Previous Year Questions to score good marks in the board examination.

Important Questions of Principles of Management Class 12 Business Studies Chapter 2

Question 1.
Appliances India Ltd. is engaged in a manufacturing and distribution of home appliances since 1987. It has a good name in the market as the company is producing good quality appliances. It has separate departments for manufacturing, finance, sales, maintenance services and technical services to achieve specialisation.
Since, the areas of operations of the company have increased and customers have become more demanding, the company decided to modify the existing principle of management to meet the changing requirements of the environment.
State the general principle of management which the company wants to modify to meet the changing requirements. (Delhi 2019)
Answer:
The company wants to modify the principle of ‘Division of Work’.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 2.
State the role of ‘speed boss’ in functional foremanship. (Foreign 2016; Delhi 2016)
Answer:
Speed boss is responsible for maintaining speed of production, investigating causes of delay and removing it.

Question 3.
State the role of ‘gang boss’ in functional foremanship. (All India 2016; Delhi 2016; Foreign 2016)
Answer:
Gang boss is responsible for keeping machines and tools ready for work.

Question 4.
State the role of ‘inspector’ in ‘functional foremanship’. (All India 2016: Delhi 2016; Foreign 2016)
Answer:
The inspector is responsible for maintaining quality of work.

Question 5.
State the role of ‘route clerk’ in functional foremanship. (All India 2016)
Answer:
Route-clerk is responsible for specifying the route of production.

Question 6.
What is determined by fatigue study? (Foreign 2014)
Or
State the objective of fatigue study. (All India 2010; Foreign 2010)
Answer:
The objective of fatigue study is to maintain the efficiency level of workers by determining the amount and frequency of rest intervals in completing a task.

Question 7.
What is the objective of ‘method study’ as a technique of scientific management? (Delhi 2014)
Answer:
The main objective of method study is to find out the best way of doing the job.

Question 8.
State the objective of time study. (All India 2014,2010; Delhi 2010)
Or
What is determined by time study? (All India 2014; Foreign 2010)
Answer:
The main objective of time study is to determine the standard time required to perform a job.

Question 9.
‘Accurate cause and effect relationship cannot be established by principles of management.’ Why? (Compartment 2013)
Answer:
Since management principles are applicable on human resource of a concern, and human behaviour is unpredictable, accurate cause and effect cannot be established by them.

Question 10.
Why do principles of management try to establish the relationship between cause and effect? State. (Comportment 2013)
Answer:
Establishing cause and effect relationship through management principles helps manager, to solve day-to-day problems easily and effectively.

Question 11.
What is meant by ‘principles of management’? (All India 2013 2009, Delhi 2011)
Answer:
Principles of management are general guidelines, which can be used for conduct in work places under certain situations. It also helps manager to take and implement thoughtful decisions.

Question 12.
Ayesha, a manager, decided that there will be separate departments for finance, marketing, production and sales in her company. By doing so she is following a principle of management. Name the principle. (Compartment 2013)
Answer:
Division of work

Question 13.
Shreya, a manager feels that employees should get enough time to adapt to a new environment to show results. By doing so she is following a principle of management. Name the principle. (Comportment 2013)
Answer:
Stability of personnel

Question 14.
Name the following principles of management:
(a) that prevents dual subordination and
(b) that prevents overlapping of working of two divisions. (Compartment 2012)
Answer:
(a) Unity of command
(b) Unity of direction

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 15.
Distinguish between the principles of ‘unity of command’ and ‘unity of direction’ on the basis of implications. (Comportment 2012)
Answer:
Difference between unity of command and unity of direction on the basis of implications is stated below:
Unity of command It affects individual employee.
Unity of direction It affects the entire organisation.

Question 16.
Define ‘scientific management’. (Comportment 2012)
Or
What is meant by scientific management? (Foreign 2011)
Answer:
Scientific management In words of Taylor, scientific management means knowing exactly what you want men to do and seeing that they do in the best and the cheapest way.

Question 17.
State why ‘principles of management’ are called contingent. (All India (C) 2012)
Or
What is meant by the statement ‘principles of management are contingent’? (All India 2011,2010; Foreign 2011)
Or
Give any one reason why principles of management are called “contingent”. (Delhi 2010; Foreign 2010)
Or
Why is it said that ‘principles of management are contingent’? (Foreign 2011)
Answer:
The application of principles of management is contingent as it depends upon the prevailing situation at a particular point of time.

Question 18.
What is meant by ‘universal applicability of principles of management’? (Delhi 2011)
Answer:
‘Universal applicability of principles of management’ means that the principles of management are intended to apply to all types of organisations at all places.

Question 19.
State any one reason why principles of management are important? (All India 2011)
Answer:
Principles of management are important as they help managers in taking thoughtful and scientific decisions.

Question 20.
What is meant by the statement ‘principles of management are flexible’? (Delhi 2011)
Or
Give any one reason why principles of management are not rigid prescriptions? (All India 2010; Delhi 2010)
Answer:
Principles of management are flexible, which means that they are not rigid, and can be modified by the manager as per the situation.

Question 21.
What is meant by Fayol’s principle of ‘esprit de corps’? (Delhi 2011)
Answer:
Fayol’s principle of ‘esprit de corps’ suggests that management should promote team spirit of unity and harmony among the employees.

Question 22.
State any one principle of scientific management. (Delhi 2011)
Answer:
Science, not rule of thumb It advocates that there is only one best method to maximise efficiency and this method should substitute rule of thumb throughout the organisation.

Question 23.
Name the principle of scientific management which emphasises on study and analysis of methods rather than estimation.
Or
Name the principle of scientific management which suggests the introduction of scientific investigation and analysis. (Delhi (C) 2011)
Answer:
Science, not rule of thumb.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 24.
Give any one reason why principles of management do not provide readymade solution to all managerial problems. (All India 2010; Delhi 2010; Foreign 2010)
Answer:
Principles of management do not provide readymade solution to all managerial problems because principles provide general guidelines to managers whereas real business situations are extremely complex and not based on theoretical knowledge.

Question 25.
Which principle of management implies that there should be ‘one head and one plan for a group of activities having the same objective? (All India 2010)
Answer:
Principle of unity of direction implies that there should be ‘one head and one plan’ for a group of activities having the same objective.

Question 26.
Which principle of management states that an employee should receive orders from one superior only? (Delhi (C) 2010)
Answer:
Unity of command states that an employee should receive orders from one superior only.

Question 27.
State the objective of motion study. (All India 2010; Delhi 2010; Foreign 2010)
Answer:
The objective of motion study is to eliminate unnecessary and wasteful motions so that it takes less time to complete the job efficiently.

Question 28.
Which technique of Taylor differentiates between an efficient worker and an inefficient worker? (All India 2010)
Answer:
Differential piece wage system differentiates between an efficient worker and an inefficient worker.

Question 29.
Which revolution involves a change in the attitude of workers and management towards one another, from competition to cooperation? (Delhi (C) 2010)
Answer:
Mental revolution involves a change in the attitude of workers and management towards one another, from competition to cooperation.

Question 30.
Explain briefly ‘unity of direction’ and ‘order’ as principles of general management. (All India 2017)
Answer:
‘Unity of direction’ and ‘order’ as principles of general management are discussed below:
(i) Unity of direction ‘One unit and one plan for the group of activities having the same objective is the essence of this principle. It implies that there should be one head and one plan for a group of activities having the same objective. It means that the efforts of members of the organisation should be directed towards the achievement of a common goal. It was forwarded by Fayol.

(ii) Order According to Fayol, ‘People and material must be in suitable place at appropriate time for maximum efficiency’. This principle states that there should be a place for everything and everyone in an organisation and that thing or person should be found at its alloted place. This will lead to increased productivity and efficiency.

Question 31.
Explain briefly ‘initiative’ and ‘esprit de corps’ as principles of general management. (All India 2017)
Answer:
‘Initiative’ and ‘esprit de corps’ as principles of general management are discussed below:
(i) Initiative It means freedom to think of new ideas and execute them. The principle of initiative implies that the managers of an organisation should encourage their subordinates to take initiative and think of new ideas or policies that are beneficial for the organisation and execute them. By ‘encouraging initiative, the management can motivate employees to work better and harder.

(ii) Esprit de corps This principle states that union is strength. It refers to team spirit, i.e. harmony in the work group and mutual understanding among the workers. A group of workers working collectively in harmony and with mutual cooperation leads to the achievement of goals efficiently. Unity among the personnel can be accomplished through proper communication and coordination.

Question 32.
Explain briefly ‘remuneration of employees’ and ‘scalar chain’ as principles of general management. (All India 2017)
Answer:
Remuneration of employees According to Fayol, the quantum and methods of remuneration payable to employees should be fair and reasonable. It should be satisfactory to both employers and employees, which gives them a reasonable standard of living and should be within the paying capacity of the company.

Scalar chain According to Fayol, scalar chain refers to the chain of authority and communication that runs from top to bottom and should be followed by managers and their subordinates.
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 1

The above figure illustrates the scalar chain. If D and O wants to communicate, the message should usually move up through C, B, A, M, N and then O. Communication through this process takes time.

Question 33.
Explain ‘unity of command’ and ‘equity’ as principles of general management. (Delhi 2017)
Answer:
Unity of command According to this principle, one subordinate should receive orders from one superior only at a given point of time. The principle is necessary to avoid confusion and conflict. Equity The principle of equity implies a 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 peon and supervisor.

But equity means application of same disciplinary rules, leave rules, etc irrespective of their grade, position and gender, language, religion or nationality, etc.

Question 34.
Explain briefly ‘discipline’ and ‘scalar chain’ as principles of general management. (Delhi 2017)
Answer:
Discipline According to Fayol, discipline is obedience, application and outward mark of respect. It is the obedience to organisational rules and employment agreement which are necessary for the working of the organisation. According to Fayol, discipline requires good superiors at all levels, clear and fair agreements and judicious application of penalties.

Scalar chain It is the chain of superiors ranking from the top to the lowest ranks. The principle of scalar chain suggests that there should be a clear line of authority from top to bottom linking managers at all levels. The scalar chain serves as the chain of command and also as the chain of communication. Under the chain of command, orders and instructions, issued at higher levels, flow through intermediate managers before reaching the lower levels.

Question 35.
Explain ‘order’ and ‘initiative’ as principles of general management. (Delhi 2017)
Answer:
Order: According to Fayol, ‘People and material must be in suitable place at appropriate time for maximum efficiency’. This principle states that there should be a place for everything and everyone in an organisation and that thing or person should be found at its alloted place. This will lead to increased productivity and efficiency.

Initiative: According to Fayol, ‘Initiative means taking the first step with self motivation, it is thinking out and executing the plan’. It is one of the traits of an intelligent person. Initiative should be encouraged because employees get satisfaction when they are allowed to take initiative. But it does not mean going against the established practices of the company for the sake of being different.

Question 36.
Name and explain the principle of management according to which a manager should replace T with ‘We’ in all his’conversation with workers? (Delhi 2013)
Answer:
Esprit de corps: It is the principle of management, according to which a manager should replace ‘I’ with ‘We’ in all his conversation with workers. Literally speaking, the phrase ‘esprit de corps’ means the spirit of loyalty and devotion which unites the members of the group.

According to Fayol, management should promote a team spirit of unity and harmony among employees. A manager should replace T with ‘We’ in all his conversations with workers to foster team spirit. This will give rise to a spirit of mutual trust and belongingness among team members.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 37.
Explain ‘harmony, not discord’ as a principle of scientific management? (Delhi 2013)
Answer:
According to this principle, there should be complete harmony between the management and the workers working in an organisation. To support this, Taylor advocated a complete ‘mental revolution’, i.e. change in the attitude of both workers and management towards one another, from competition to cooperation. Both should realise the importance of each other.

Question 38.
Explain ‘cooperation, not individualism’ as a principle of scientific management? (Delhi 2013)
Answer:
‘Cooperation, not individualism’ is a principle of scientific management which states that there should be complete cooperation between the workers and management in an oganisation instead of individualism and competition. In the absence of constant and willing cooperation between the two sides, maximum prosperity for both the parties cannot be achieved.

Question 39.
Explain how principles of management:
(i) provide useful insight into reality and
(ii) help in thoughtful decision-making (Delhi 2012)
Answer:
(i) Provide useful insight into reality The principles of management provide useful insight into real world situations. Managers may apply these principles to fulfil their tasks and responsibilities. These principles guide the managers in taking and implementing thoughtful decisions.

(ii) Thoughtful decision-making These principles help in enhancing knowledge, ability and understanding of managerial situations and circumstances. They must be timely, realistic and subject to measurement and evaluation. They emphasise logic rather than blind faith and are free from bias and prejudice.

Question 40.
Explain how principles of management:
(i) help in optimum utilisation of resources and effective administration, and
(ii) help the managers in meeting changing environment requirements. (All India 2012)
Answer:
(i) Principles of management help in optimum utilisation of resources by equipping managers to foresee the cause and effect relationship of their decisions and actions, as such the wastage associated with a trial and error approach can be overcome.
Principles of management help in effective administration by limiting the boundaries of management discretion so that their decisions may be free from personal prejudice and bias.

(ii) Principles of management help the managers in meeting changing environment requirements because they can be modified according to the changes taking place in the environment, e.g. the principle of division of work has now been extended to the entire business. Therefore, companies are focusing on their competency and outsourcing non-core business.

Question 41.
Explain how principles of management:
(i) help the managers in taking scientific decisions, and
(ii) provide the managers with useful insights into real world situations. (All India 2012)
Answer:
(i) Scientific decisions The knowledge of management principles enables managers to learn the cause and effect relationship between variables operating in the organisation. They are able to develop a scientific and objective approach towards problem solving and decision-making.

(ii) Provide the manager with useful insight into reality Management principles act as guidelines for the managers. These principles improve knowledge, ability and understanding of managers under various managerial situations. The effects of these principles help the managers to learn from their mistakes.

Question 42.
Name and explain the technique of scientific management which helps in establishing interchangeability of manufactured parts and products. (All India 2010: Delhi 2010)
Answer:
Standardisation is the process of setting standards for every business activity process, raw materials, time, product and machinery.
Taylor advocated the standardisation of tools, and equipment, cost system and several other items.
The objectives of standardisation are:

  • To reduce a given line or product to fixed types.
  • To establish interchangeability of manufactured parts and products.
  • To establish quality standards.
  • To establish performance standards of men and machines.

Question 43.
Name and explain the principle of management which requires judicious application of penalties by the management. (All India 2010; Delhi 2010)
Answer:
Discipline According to Fayol, discipline is obedience, application and outward mark of respect. It is the obedience to organisational rules and employment agreement which are necessary for the working of the organisation. According to Fayol, discipline requires good superiors at all levels, clear and fair agreements and judicious application of penalties.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 44.
Name and explain the principle of management in which workers should be encouraged to develop and carry out their plans for improvement in the organisation. (Delhi (C) 2010)
Answer:
Initiative According to Fayol, ‘Initiative means taking the first step with self motivation, it is thinking out and executing the plan’. It is one of the traits of an intelligent person. Initiative should be encouraged because employees get satisfaction when they are allowed to take initiative. But it does not mean going against the established practices of the company for the sake of being different.

Question 45.
State any four or five features of principles of management. (All India 2019,2015; Delhi 2019,2015: Compartment 2012)
Or
Explain any five characteristics which reflect the nature of principles of management. (Delhi (C) 2010)
Answer:
Management principles are broad and general guidelines for decision-making and behaviour. Following features highlight the characteristics of management principles:
(i) Universal application Management principles are applied in every situation where the objectives are attained through group efforts. All social, economic, political or ‘ religious organisations apply management principles for their successful operations. Every organisation must make the best possible use of its available resources by the application of management principles alongwith managerial functions such as planning, organising, staffing, directing and controlling.

(ii) Flexibility: 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 so demands. They give the manager enough discretion to do so.

(iii) General statements: Management principles are concerned with human behaviour which cannot be tested under laboratory conditions. Human behaviour cannot be predicted accurately. Therefore, management principles are not as exact as the principles of physical science.

(iv) Influencing human behaviour Human element is an essential factor of production. It activates and extracts work from other factors also. Each person is different from other as regards to his ability, knowledge, skills, social status, attitudes and ideologies. Management is concerned with the integration of individual efforts.

(v) Cause and effect relationship Management principles also form a cause and effect relationship. It indicates the consequences of certain actions or inactions in the business, e.g. if wages are paid on piece rate system, the quantity of work will increase but the quality will suffer. The principle of unity of command will avoid confusion, duplication and overlapping of work.

Question 46.
State any four points which highlight the importance of principles of management. (All India 2019, 2015)
Or
What is meant by principles of management? State any three points of their importance. (Delhi 2015)
Or
Explain how principles of management:
(i) help in optimum utilisation of resources and effective administration and
(ii) help in the thoughtful decision-making. (Foreign 2012)
Answer:
Management principles are essential for the successful running of business organisation. These principles are guidelines to management. They highlight the areas where the management should pay immediate attention. These principles simplify the process of management, increase the overall efficiency of management and help in the achievement of objectives.

The significance of management principles can be summarised as follows:
(i) Provide the manager with useful insight into reality Management principles act as guidelines for the managers. These principles improve knowledge, ability and understanding of managers under various managerial situations. The effects of these principles help the managers to learn from their mistakes.

(ii) Optimum utilisation of resources Several principles of management aim at optimum utilisation of all types of resources for the attainment of organisational goals, e.g. principles of division of work, discipline, unity of direction, order, etc facilitate better utilisation of human efforts and physical resources.

(iii) Scientific decisions The knowledge of management principles enables managers to learn the cause and effect relationship between variables operating in the organisation. They are able to develop a scientific and objective approach towards problem solving and decision-making.

(iv) Meeting changing environment requirements Every businessman has to cope up with the changes that are taking place in the business environment. Management principles train the managers to implement the changes in right direction and at right level in the organisation.

(v) Fulfilling social responsibility A manager is able to achieve efficiency and economy in the activities of his enterprise by applying management principles. These principles are aimed at maximising profits without loss of social value. In other words, management principles seek to ensure that the resources of the society are utilised fully and good quality products at fair prices are made available to society.

Question 47.
Explain the following techniques of scientific management.
(a) Fatigue study
(b) Differential piece wage system (Delhi 2019)
Answer:
(a) Fatigue study Fatigue in work is natural. When the worker is given continuous work, he will get tired and lose speed and efficiency. He needs rest after working for a few hours. Scientific management studies the nature of work to determine the standard time for finishing the job and to find out when the workers need rest. The nature, time and period of rest are pre-determined. Necessary changes should also be made in the working methods and conditions to reduce fatigue.

(b) Taylor wanted to differentiate between efficient and inefficient workers. Under this system of wage payment, wages are paid on the basis of work done. According to him, higher rates were given to the workers who are producing standard products or more and lower rates were given to those who are producing less. e.g.
Standard output = 100 units/day
Wage rate 1 = ₹ 10/unit for standard output (100 units) or more
Wage rate 2 = ₹ 7/unit for below standard output
Worker 1 = Output 99 units
Wages = 99 × 7 = ₹ 693
Worker 2 = Output 101 units
Wages = 101 × 10 = ₹ 1010
Thus, a difference of ₹ 317 (1,010 – 693), for different of 2 units is enough to motivate the inefficient work for more output.

Question 48.
Explain the following principles of scientific management:
(a) Harmony, not discord
(b) Development of each and every person to his or her greatest efficiency and prosperity. (Delhi 2019)
Answer:
(a) Taylor believed ‘management should share the gains with workers’. This has been emphasised by the principle of ‘harmony, not discord’, which also emphasised on mental revolution.

Harmony, not discord The interests of the employers and employees should be fully harmonised so as to create a good relationship. Taylor emphasised that there should be complete harmony between the management and workers. This requires a transformation in the thinking of both, which can be achieved through mental revolution.

Management should share the gains of the company with the workers. At the same time, workers should work and embrace changes. Taylor beleived in, that prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice-versa.

In the same way, Fayol’s principle of ‘remuneration of employees’ suggested that the employees compensation should depend on the earning capacity of the company and should give them a reasonable standard of living. Remuneration of employees According to Fayol, the quantum and methods of remuneration payable to employees should be fair and reasonable. It should be satisfactory to both employers and employees. Thus, we can say that Taylor’s and Fayol’s principles are mutually complementary.

(b) Development of each and every person to his/her greatest efficiency and prosperity Industrial efficiency depends upon the efficiency of workers and worker’s efficiency depends upon proper training and their proper selection. Taylor suggested that due care should be taken while selecting the employees and after selection, they must be given job according to their physical, mental and intellectual capabilities. Employees must be sent for training from time to time to update their knowledge. This will ensure greatest efficiency and prosperity for both workers and management.

Question 49.
Deewan Ltd. is a multinational consulting company with its headquarters at Washington D.C. It hires young people from different countries of the world.
It is a company in which people dream to work because of its work environment, pay and growth prospectus. The company has a culture of open communication and people of various nationalities work together in a discrimination free environment. The behaviour of managers of Deewan Ltd. emphasises kindliness and justice which ensures loyality and devotion of workers.
It also promotes mutual trust and belongingness among team members. In this way, management of Deewan Ltd. is able to achieve its objectives by promoting teamwork. By doing so managers of Deewan Ltd. are following some principles of management. Identify and explain any two such principles. (Comportment 2018)
Answer:
The principles followed are:

  • Initiative
  • Esprit de corps

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 50.
Sanket, after completing his entrepreneurship course from U.S.A. returned to India and started a coffee shop ‘Fioma Coffee’ in a famous mall in Mumbai. The speciality of the coffee shop was the special aroma of coffee and a wide variety of flavours to choose from. Somehow, the business was neither profitable nor pupular. Sanket was keen to find out the reason. He appointed Riya, an MBA from a reputed management institute as a manager to find out the causes of the business not doing well. Riya, took a feedback from the clients and found out that though they loved the special unique aroma of coffee but were not happy with the long waiting time being taken to process the order. She analysed and found out that there were many unnecessary obstructions which could be eliminated. She fixed a standard time for processing order. She also realised that there were many flavours whose demand was not enough. So, she also decided to discontinue the sale of such flavours. As a result, within a short period Riya was able to attract the customers. Identify and explain any two techniques of scientific management used by Riya to solve the problem. (All India 2017; Delhi 2017)
Answer:
The two techniques of scientific management used by Riya are:
(i) Time study It refers to determine the standard time required to complete a particular activity. The standard time is determined on the basis of average time taken to complete the work. This study is conducted with the help of a stop watch. The main objective of this study is to get the estimated figure of labour cost to determine the number of required workers and to decide the suitable incentive plan.

(ii) Simplification It helps in eliminating unnecessary diversity of products and thus, results in saving cost. It aims at eliminating superfluous varieties, sizes and dimensions. It leads to reduction in wastage of inventories, fuller utilisation of equipment and increased turnover.

Question 51.
Principles of Taylor and Fayol are mutually complementary. One believed that management should not close its ears to constructive suggestions made by the employees while the other suggested that a good company should have an employee suggestion system, whereby suggestions which result in substantial time or cost reduction should be rewarded.
Identify and explain the principles of Taylor and Fayol referred in the above para. (Delhi 2014)
Answer:
Cooperation and individualism Management should not close its ears to constructive suggestions made by the employees, is related with the principle of Taylor, i.e. ‘cooperation not individualism’. This principle is an extension of principle of harmony. Competition should be replaced by cooperation. Management and workers both should realise that they need each other. For this, management should entertain the constructive suggestions of employees and at the same time, workers should also cooperate with management.

Initiative Another principle is related with Fayol, i.e. ‘initiative’ in which he suggested that employees at all levels should take initiatives or actions without any force or boundations. This will help to motivate them and they will work hard for the betterment of the organisation. He stressed that a good company should have an employee suggestion system where by initiatives/ suggestions which result in substantial cost/time reduction should be awarded.

Question 52.
Principles of Taylor and Fayol are mutually complementary. One believed that the management should share the gains with the workers, while the other suggested that employees compensation should depend on the earning capacity of the company and should give them a reasonable standard of living.
Identify and explain the principles of Fayol and Taylor referred to in the above para. (All India 2014)
Answer:
Taylor believed ‘management should share the gains with workers’. This has been emphasised by the principle of ‘harmony, not discord’, which also emphasised on mental revolution.

Harmony, not discord The interests of the employers and employees should be fully harmonised so as to create a good relationship. Taylor emphasised that there should be complete harmony between the management and workers. This requires a transformation in the thinking of both, which can be achieved through mental revolution.

Management should share the gains of the company with the workers. At the same time, workers should work and embrace changes. Taylor beleived in, that prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice-versa.

In the same way, Fayol’s principle of ‘remuneration of employees’ suggested that the employees compensation should depend on the earning capacity of the company and should give them a reasonable standard of living. Remuneration of employees According to Fayol, the quantum and methods of remuneration payable to employees should be fair and reasonable. It should be satisfactory to both employers and employees. Thus, we can say that Taylor’s and Fayol’s principles are mutually complementary.

Question 53.
Principles of Taylor and Fayol are mutually complementary. One believed that the management should scientifically select the person and the work assigned should suit his/her physical and intellectual capabilities, while the other suggested that the work can be performed more efficiently if divided into specialised tasks. Identify and explain the principles of Fayol and Taylor referred to in the above para. (Foreign 2014)
Answer:
The principle of Fayol referred to in the above para is division of work. Division of work Every employee should be assigned only one type of work. It means that total work is divided into small tasks/jobs and a trained specialist performs each job. The objective of division of labour derive the benefits from the principle of specialisation which can be applied to all work.

For example, publishing of a book involves several operations like computer typing of text material, proof reading, printing, binding, etc. All the operations are performed by different people who are experts in their respective field.

The principle of Taylor referred to in the above para is development of each and every person to his/her greatest efficiency and prosperity. Development of each and every person to his/her greatest efficiency and prosperity Industrial efficiency depends upon the efficiency of workers and worker’s efficiency depends upon proper training and their proper selection. Taylor suggested that due care should he taken while selecting the employees and after selecti on, they must be given job according to their physical, mental and intellectual capabilities. Employees must be sent for training from time to time to update their knowledge. This will ensure greatest efficiency and prosperity for both workers and management.

Question 54.
Explain ‘harmony not discord’ as a principle and ‘fatigue study’ as a technique of scientific management. (Comportment 2013)
Answer:
Taylor believed ‘management should share the gains with workers’. This has been emphasised by the principle of ‘harmony, not discord’, which also emphasised on mental revolution.

Harmony, not discord The interests of the employers and employees should be fully harmonised so as to create a good relationship. Taylor emphasised that there should be complete harmony between the management and workers. This requires a transformation in the thinking of both, which can be achieved through mental revolution.

Management should share the gains of the company with the workers. At the same time, workers should work and embrace changes. Taylor beleived in, that prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice-versa.

In the same way, Fayol’s principle of ‘remuneration of employees’ suggested that the employees compensation should depend on the earning capacity of the company and should give them a reasonable standard of living. Remuneration of employees According to Fayol, the quantum and methods of remuneration payable to employees should be fair and reasonable. It should be satisfactory to both employers and employees. Thus, we can say that Taylor’s and Fayol’s principles are mutually complementary.

Fatigue study:
Fatigue in work is natural. When the worker is given continuous work, he will get tired and lose speed and efficiency. He needs rest after working for a few hours. Scientific management studies the nature of work to determine the standard time for finishing the job and to find out when the workers need rest. The nature, time and period of rest are pre-determined. Necessary changes should also be made in the working methods and conditions to reduce fatigue.

Question 55.
Explain ‘science, not rule of thumb’ as a principle and ‘time-study’ as a technique of scientific management. (compartment 2013)
Answer:
Science, not rule of thumb:
Taylor has emphasised that in scientific management, organised knowledge should be applied, which will replace the rule of thumb. Scientific investigations should be used for taking managerial decisions instead of making the decisions on opinions, intuitions, estimates, prejudices, likes and dislikes, etc. Under scientific management, decisions are made on the basis of facts developed by the application of scientific methods.

Time study:
Time study It refers to determine the standard time required to complete a particular activity. The standard time is determined on the basis of average time taken to complete the work. This study is conducted with the help of a stop watch. The main objective of this study is to get the estimated figure of labour cost, to determine the number of required workers and to decide the suitable incentive plan.

Question 56.
Explain the technique of scientific management, i.e. the extension of principle of division of work and specialisation. (Delhi 2012)
Or
Explain the technique of scientific management which separates the planning and execution work. (Foreign 2012)
Answer:
Functional foremanship It is an extension of the principles of division of work and specialisation. The term, functional foremanship means separation of planning from execution. Each worker is supervised by various specialists. For this, Taylor suggested that under the factory manager, there is a planning incharge and a production incharge. The main function of the planning incharge is to plan all aspects of a job to be performed.

Under planning incharge, following four personnel are appointed:

  • Route clerk
  • Instmction card clerk
  • Time and cost clerk
  • Disciplinarian

Under production incharge, following four personnel are appointed who are concerned with the execution of the plans:

  • Gang boss
  • Speed boss
  • Repair boss
  • Inspector

Question 57.
Explain that technique of scientific management which is the strongest motivator for a worker to reach standard performance. (All India 2012)
Answer:
Differential piece wage system is the strongest motivator for a worker to reach standard performance. It is a method of wage payment in which efficient and inefficient workers are paid at different rates. In this method, increase in efficiency is co-related with an increase in the wage rate. That is why, an efficient worker gets more wages, whereas, an inefficient worker gets less.

Workers are paid on the basis of number of units produced. If a worker produces more than a certain number of units (standard output), he gets higher wage per piece/units, on his total output. If he produces below the standard number, he gets lower rate per piece. Because of different rates of wage for different sets of workers, this is known as differential piece rate plan.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 58.
Explain the technique of ‘simplification and standardisation of work’ given by Taylor. (Compartment 2012)
Answer:
Simplification means eliminating superfluous sizes, varieties and dimensions. Its aim is to:

  • eliminate unnecessary diversity of products and thereby reduce costs.
  • help in achieving economy in the use of required machines and tools.

Standardisation of work is the technique of scientific management, which helps in establishing interchangeability of manufactured parts and products. It is the process of setting standards for every business activity, process, raw materials, time, machinery and methods to achieve efficiency. Standardisation of product implies that the size, design, quality, shape, etc of the product should meet the requirements and tastes of consumers.

The objectives of standardisation are:

  • To maintain quality standards.
  • To set up performance standards for men.
  • To provide interchangeability of manufacture and products.
  • To achieve target production.

Question 59.
Explain with the help of an example ‘differential piece wage system’ given by Taylor. (Compartment 2012)
Answer:
Taylor wanted to differentiate between efficient and inefficient workers. Under this system of wage payment, wages are paid on the basis of work done. According to him, higher rates were given to the workers who are producing standard products or more and lower rates were given to those who are producing less. e.g.
Standard output = 100 units/day
Wage rate 1 = ₹ 10/unit for standard output (100 units) or more
Wage rate 2 = ₹ 7/unit for below standard output
Worker 1 = Output 99 units
Wages = 99 × 7 = ₹ 693
Worker 2 = Output 101 units
Wages = 101 × 10 = ₹ 1010
Thus, a difference of ₹ 317 (1,010 – 693), for different of 2 units is enough to motivate the inefficient work for more output.

Question 60.
Explain the following techniques of scientific management: (Compartment 2012)
(i) Time study
(ii) Motion study
Or
Explain the techniques of ‘method study’ and ‘motion study’ given by Taylor. (Comportment 2012)
Answer:
The ultimate aim of scientific management is to maximise production at the minimum cost.

Scientific management is introduced through the techniques of work study, standardisation, simplification, functional foremanship etc. Following are the five techniques of scientific management:
(i) Time study: It refers to determine the standard time required to complete a particular activity. The standard time is determined on the basis of average time taken to complete the work. This study is conducted with the help of a stop watch. The main objective of this study is to get the estimated figure of labour cost, to determine the number of required workers and to decide the suitable incentive plan.

(ii) Motion study: This is the analysis of physical movements in doing a work. Every work involves various forms of human movements such as lifting, holding, turning, etc. Under motion study, each movement is analysed to find out easier ways of doing the work and eliminate useless motions.
Following steps are involved in motion study:

  • Selection of efficient workers.
  • Analysis of the motions involved in a work.
  • Finding the minimum time involved in doing a work.
  • Keeping record of the best moves and unnecessary/unproductive actions.

(iii) Method study: It refers to identifying the most suitable way to do a particular activity. To conduct this study, process chart and operation research techniques are used. The main objective of this study is to minimise the cost of production and maximise the quality and level of consumer satisfaction.

(iv) Fatigue study: Fatigue in work is natural. When the worker is given continuous work, he will get tired and lose speed and efficiency. He needs rest after working for a few hours. Scientific management studies the nature of work to determine the standard time for finishing the job and to find out when the workers need rest. The nature, time and period of rest are pre-determined. Necessary changes should also be made in the working methods and conditions to reduce fatigue.

(v) Functional foremanship: Taylor suggested functional foremanship for better supervision of workers. Under functional foremanship, there are specialist foremen for each job. He classified specialist foremen into two departments, namely planning and production departments. Both the departments have eight foremen in all.
The names and functions of these foremen are as follows:
(a) Planning Department:
Route clerk Determining the process of production and the route through which the raw materials will pass.
Instruction card clerk Laying down instructions according to which the workers are required to, perform work.
Time and cost clerk Setting the time table for doing a job as per the pre-determined route and time schedule. He specifies the material and labour cost with respect to each operation.
Disciplinarian Maintaining proper discipline in the factory.

(b) Production Department
Gang boss Arranging machines, materials, tools, workers, etc for the job.
Speed boss Maintaining the planned speed of . production, investigating the causes for delay and remove them.
Repair boss Maintenance of the machines and equipments, proper arrangements for their oiling, greasing, cleaning and repair, preventing misuse of machines, etc.
Inspectors Seeing that the work confirms to the standard of quality laid down by the planning department.

Question 61.
Explain any two techniques of Taylor’s scientific management. (All India 2011; Delhi 2011)
Answer:
Two techniques of Taylor’s scientific management are as follows:
(i) Functional foremanship:
It is an extension of the principles of division of work and specialisation. The term, functional foremanship means separation of planning from execution. Each worker is supervised by various specialists. For this, Taylor suggested that under the factory manager, there is a planning incharge and a production incharge. The main function of the planning incharge is to plan all aspects of a job to be performed.

Under planning incharge, following four personnel are appointed:

  • Route clerk
  • Instmction card clerk
  • Time and cost clerk
  • Disciplinarian

Under production incharge, following four personnel are appointed who are concerned with the execution of the plans:

  • Gang boss
  • Speed boss
  • Repair boss
  • Inspector

(ii) Standardisation and simplification:
Standardisation refers to the process of setting standards for every business activity. It can be standardisation of process, raw material, time, product, machinery, methods or working conditions. These standards are the benchmarks which must be adhered during production. Simplification aims at eliminating unnecessary varieties, sizes and dimensions of products. It results in saving of cost of labour, machines and tools.

Question 62.
Explain the concept of ‘functional foremanship’ and ‘mental revolution’ in scientific management as enunciated hy ‘Taylor’. (Delhi (C) 2011)
Answer:
Fuiictional foremanship:
Two techniques of Taylor’s scientific management are as follows:
(i) Functional foremanship:
It is an extension of the principles of division of work and specialisation. The term, functional foremanship means separation of planning from execution. Each worker is supervised by various specialists. For this, Taylor suggested that under the factory manager, there is a planning incharge and a production incharge. The main function of the planning incharge is to plan all aspects of a job to be performed.

Under planning incharge, following four personnel are appointed:

  • Route clerk
  • Instmction card clerk
  • Time and cost clerk
  • Disciplinarian

Under production incharge, following four personnel are appointed who are concerned with the execution of the plans:

  • Gang boss
  • Speed boss
  • Repair boss
  • Inspector

Mental revolution Mental refers to mind and revolution refers to radical change. Therefore, mental revolution refers to a change of mind. According to Taylor, scientific management, in its essence, involves a complete mental revolution on the part of both sides of industry, viz workers and management.

No scheme of scientific management could be a success, unless and until both these groups fully cooperate with each other through developing and maintaining best friendly relations. This requires a mental revolution on the part of management and workers by giving up an attitude of hostility and enmity towards each other.

Question 63.
Explain any two principles of Taylor’s scientific management. (Foreign 2011; Delhi 2011)
Or
Explain any three principles of scientific management. (All India 2019)
Answer:
Principles of scientific management are as follows (any two):
(i) Science, not rule of thumb Taylor has emphasised that in scientific management, organised knowledge should be applied, which will replace the rule of thumb. Scientific investigations should be used for taking managerial decisions instead of making the decisions on opinions, intuitions, estimates, prejudices, likes and dislikes, etc. Under scientific management, decisions are made on the basis of facts developed by the application of scientific methods.

(ii) Harmony, not discord (Conflict) There should be harmony between the management and the workers. This requires change of mental attitudes of the workers and the management towards each other. Taylor called it mental revolution.

Management should share gains of the company with workers. They should create suitable working conditions and resolve all problems scientifically. Menial revolution on the part of workers require that they should be disciplined, loyal and sincere in fulfilling the tasks assigned to them. Instead of fighting for dividing surplus or profit, the management and workers should cooperate to increase it.

(iii) Cooperation, not individualism There should be cooperation between workers and management. It is only through cooperation with workmen, the managers can ensure that work is carried out according to plans. Cooperation is based on mutual faith so managers should develop understanding with workers to secure the cooperation.

(iv) Development of each and every person to his/her greatest efficiency and prosperity Industrial efficiency depends upon the efficiency of workers and worker’s efficiency depends upon proper training and their proper selection. Taylor suggested that due care should be taken while selecting the employees and after selection, they must be given job according to their physical, mental and intellectual capabilities. Employees must be sent for training from time to time to update their knowledge. This will ensure greatest efficiency and prosperity for both workers and management.

(v) Maximum output in place of restricted output The aim of both management and the workers should be to maximise output. This should be done by both parties in their own self interest. For management, increased production means more profits and lower cost of production. For workers, increased output may offer attractive wages. In this way, self interest implies both management and the workers to achieve maximum output. Maximum output will also be in the interest of the society.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 64.
Explain Fayol’s principles of ‘equity’ and ‘order’ with examples. (All India 2011; Foreign 2011)
Answer:
(i) Equity The principle of equity implies a 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 peon and supervisor.

But equity means application of same disciplinary rules, leave rules, etc irrespective of their grade, position and gender, language, religion or nationality, etc. For example, the rules for granting medical leave to an employee should be same irrespective of their position, grade or gender.

(ii) Order According to Fayol, ‘People and material must be in suitable place at appropriate time for maximum efficiency’. This principle states that there should be a place for everything and everyone in an organisation and that thing or person should be found at its alloted place. This will lead to increased productivity and efficiency.
For example, raw material should be available at the place prescribed for it.

Question 65.
Explain the following principles of Fayol with the help of one example for each
(i) Discipline
(ii) Unity of command (Delhi (C) 2011)
Answer:
(i) Discipline Discipline is obedience, application and outward mark of respect. It means obedience to the rules of the organisation on the part of both superiors and subordinates. Discipline is necessary for the smooth running of the organisation. According to Fayol, ‘Discipline requires good superiors at all levels, clear and fair agreement and judicious application of penalties’. Discipline does not mean only rules and regulations but it also means development of commitment on the part of employees towards organisation as well as towards each other.

For example, in XYZ Ltd, management and labour union have entered into an agreement whereby workers have agreed to revive the business out of loss. In return, management would raise the wages of workers. Here ‘discipline’ means the workers and management both will honour their commitments.

(ii) Unity of command A subordinate should receive orders from one superior only at a given point of time. According to this principle, one subordinate should receive orders from one superior only at a given point of time. The principle is necessary to avoid confusion and conflict. i
For example, if a subordinate receives orders from more than one superior in an organisation he will not be able to carryout multiple orders in a proper manner and thus, would be unable to satisfy his superiors. The subordinate would be in a confused state, as to whose orders should be followed. The principle of unity of command has been shown in the following diagram
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 2

Question 66.
Explain Fayol’s principles of ‘Scalar chain’ and ‘Discipline’ with the help of examples. (Foreign 2011)
Answer:
(i) Scalar chain It is the chain of superiors ranking from the top to the lowest ranks. The principle of scalar chain suggests that there should be a clear line of authority from top to bottom linking managers at all levels. The scalar chain serves as the chain of command and also as the chain of communication. Under the chain of command, orders and instructions, issued at higher levels, flow through intermediate managers before reaching the lower levels. The chain should not be violated in normal course of formal comipunication. However, in emergency, communication can take place between two people working at the same level but in different departments, through gang plank.

(ii) Discipline Discipline is obedience, application and outward mark of respect. It means obedience to the rules of the organisation on the part of both superiors and subordinates. Discipline is necessary for the smooth running of the organisation. According to Fayol, ‘Discipline requires good superiors at all levels, clear and fair agreement and judicious application of penalties’. Discipline does not mean only rules and regulations but it also means development of commitment on the part of employees towards organisation as well as towards each other.

Question 67.
Explain the following principles of Fayol with the help of one example of each.
(i) Division of work
(ii) Unity of direction (All India 2011; Delhi (C) 2011)
Answer:
(i) Division of work Every employee should be assigned only one type of work. It means that total work is divided into small tasks/jobs and a trained specialist performs each job. The objective of division of labour derive the benefits from the principle of specialisation which can be applied to all work.
For example, publishing of a book involves several operations like computer typing of text material, proof reading, printing, binding, etc. All the operations are performed by different people who are experts in their respective field.

(ii) Unity of direction ‘One unit and one plan’ for the group of activities having the same objective. This principle implies that there should be one head and one plan for a group of activities having the same objective. It means that the efforts of members of the organisation should be directed towards the achievement of a common goal. For example, the mission of a company is to provide quality products at an affordable prices to the customers. This should serve as a direction for all the departments, namely, purchasing, financing, quality control and marketing.

Question 68.
Explain the following principles of Fayol with the help of one example for each.
(i) Scalar chain
(ii) Stability of tenure of personnel (All India 2011)
Answer:
(i) Scalar chain It is the chain of superiors ranking from the top to the lowest ranks. The principle of scalar chain suggests that there should be a clear line of authority from top to bottom linking managers at all levels. The scalar chain serves as the chain of command and also as the chain of communication. Under the chain of command, orders and instructions, issued at higher levels, flow through intermediate managers before reaching the lower levels. The chain should not be violated in normal course of formal communication.
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 3

However, in emergency, communication can take place between two people working at the same level but in different departments, through gang plank. For example, if in XYZ Ltd, E wants to communicate with R. He will have to follow the path in chain like first he delivers information to D, then D to C, B, A, M, N, O and at last E transfers the message to R. But in case of emergency, E can directly contact with R according to the concept of gang plank.

(ii) Stability of tenure of personnel According to this principle, there should be a reasonable security of jobs. Labour turnover should be minimised to maintain organisational efficiency. Personnel should be selected and appointed after due and rigorous procedure.

But once selected, they should be kept at their post/position for a minimum fixed tenure. They should be given reasonable time to show results. Any adhodsm in this regard will create unstability/insecurity among employees. They would tend to leave the organisation. Under this situation, recruitment, selection and training cost will be high.

eg. If Amav is hired for the post of executive in a company, then, according to this principle, he should be kept on the same position for a fixed tenure say for 1 year, so that he can show results.

Question 69.
(i) Name and explain the principle of management in which workers should be encouraged to develop and carry out their plans for improvements in the organisation.
(ii) Name and explain the technique of scientific management which is an extension of the principle of division of work and specialisation. (Foreign 2010)
Answer:
(i) Principle of initiative According to Fayol, ‘Initiative means taking the first step with self motivation, it is thinking out and executing the plan’. It is one of the traits of an intelligent person. Initiative should be encouraged because employees get satisfaction when they are allowed to take initiative. But it does not mean going against the established practices of the company for the sake of being different.

(ii) Functional foremanship Taylor suggested functional foremanship for better supervision of workers. Under functional foremanship, there are specialist foremen for each job. He classified specialist foremen into two departments, namely planning and production departments. Both the departments have eight foremen in all The names and functions of these foremen are as follows:
(a) Planning Department:
Route clerk Determining the process of production and the route through which the raw materials will pass.
Instruction card clerk Laying down instructions according to which the workers are required to perform work.
Time and cost clerk Setting the time table for doing a job as per the pre-determined route and time schedule. He specifies the material and labour cost with respect to each operation. Disciplinarian Maintaining proper discipline in the factory.

(b) Production Department:
Gang boss Arranging machines, materials, tools, workers, etc for the job.
Speed boss Maintaining the planned speed of production, investigating the causes for delay and remove them.
Repair boss Maintenance of the machines and equipments, proper arrangements for their oiling, greasing, cleaning and repair, preventing misuse of machines, etc.
Inspectors Seeing that the work confirms to the standard of quality laid down by the planning department.

Question 70.
Explain following techniques of scientific management.
(a) Time study
(b) Motion study
(c) Function foremanship (All India 2019; Delhi 2019)
Answer:
(a) Time study: It refers to determine the standard time required to complete a particular activity. The standard time is determined on the basis of average time taken to complete the work. This study is conducted with the help of a stop watch. The main objective of this study is to get the estimated figure of labour cost, to determine the number of required workers and to decide the suitable incentive plan.

(b) Motion study: This is the analysis of physical movements in doing a work. Every work involves various forms of human movements such as lifting, holding, turning, etc. Under motion study, each movement is analysed to find out easier ways of doing the work and eliminate useless motions.
Following steps are involved in motion study:

  • Selection of efficient workers.
  • Analysis of the motions involved in a work.
  • Finding the minimum time involved in doing a work.
  • Keeping record of the best moves and unnecessary/unproductive actions.

(c) Functional foremanship Taylor suggested functional foremanship for better supervision of workers. Under functional foremanship, there are specialist foremen for each job. He classified specialist foremen into two departments, namely planning and production departments. Both the departments have eight foremen in all The names and functions of these foremen are as follows:
(a) Planning Department:
Route clerk Determining the process of production and the route through which the raw materials will pass.
Instruction card clerk Laying down instructions according to which the workers are required to perform work.
Time and cost clerk Setting the time table for doing a job as per the pre-determined route and time schedule. He specifies the material and labour cost with respect to each operation. Disciplinarian Maintaining proper discipline in the factory.

(b) Production Department:
Gang boss Arranging machines, materials, tools, workers, etc for the job.
Speed boss Maintaining the planned speed of production, investigating the causes for delay and remove them.
Repair boss Maintenance of the machines and equipments, proper arrangements for their oiling, greasing, cleaning and repair, preventing misuse of machines, etc.
Inspectors Seeing that the work confirms to the standard of quality laid down by the planning department.

Question 71.
Explain following principles of general management.
(a) Division of work
(b) Authority and responsibility
(c) Discipline (All India 2019)
Answer:
(a) Division of work Every employee should be assigned only one type of work. It means that total work is divided into small tasks/jobs and a trained specialist performs each job. The objective of division of labour derive the benefits from the principle of specialisation which can be applied to all work.
For example, publishing of a book involves several operations like computer typing of text material, proof reading, printing, binding, etc. All the operations are performed by different people who are experts in their respective field.

(b) Authority and responsibility Authority means the right to give orders and obtain obedience. On the other hand, responsibility means obligation to complete the assigned task on time. According to Fayol, there must be a balance between authority and responsibility. Excess of authority without matching responsibility may result in misuse of authority, whereas excess responsibility without adequate authority may lead to failure of organisational goals.

(c) Discipline: Discipline is obedience, application and outward mark of respect. It means obedience to the rules of the organisation on the part of both superiors and subordinates. Discipline is necessary for the smooth running of the organisation. According to Fayol, ‘Discipline requires good superiors at all levels, clear and fair agreement and judicious application of penalties’. Discipline does not mean only rules and regulations but it also means development of commitment on the part of employees towards organisation as well as towards each other.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 72.
Explain the following principles of general management.
(a) Unity of command
(b) Subordination of individual interest to general interest
(c) Stability of personnel (All India 2019)
Answer:
(a) Unity of command A subordinate should receive orders from one superior only at a given point of time. According to this principle, one subordinate should receive orders from one superior only at a given point of time. The principle is necessary to avoid confusion and conflict.
For example, if a subordinate receives orders from more than one superior in an organisation he will not be able to carryout multiple orders in a proper manner and thus, would be unable to satisfy his superiors. The subordinate would be in a confused state, as to whose orders should be followed. The principle of unity of command has been shown in the following diagram
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 4

(b) Subordination of individual interest to general interest The interest of an organisation is to achieve its goals. These goals are achieved after integrating the efforts of different individuals who are working in the organisation to satisfy their own personal needs. Sometimes, an individual starts giving priority to his own interest.
Thus, the interests of various stakeholders, i.e. owners, shareholders, creditors, financers and the society cannot be sacrificed for one individual.

(c) Stability of tenure of personnel According to this principle, there should be a reasonable security of jobs. Labour turnover should be minimised to maintain organisational efficiency. Personnel should be selected and appointed after due and rigorous procedure.

But once selected, they should be kept at their post/position for a minimum fixed tenure. They should be given reasonable time to show results. Any adhodsm in this regard will create unstability/insecurity among employees. They would tend to leave the organisation. Under this situation, recruitment, selection and training cost will be high.

eg. If Amav is hired for the post of executive in a company, then, according to this principle, he should be kept on the same position for a fixed tenure say for 1 year, so that he can show results.

Question 73.
Explain the following techniques of scientific management.
(a) Method study
(b) Fatigue study
(c) Differential piece wage system (All India 2019)
Answer:
(a) Method study It refers to identifying the most suitable way to do a particular activity. To conduct this study, process chart and operation research techniques are used. The main objective of this study is to minimise the cost of production and maximise the quality and level of consumer satisfaction.

(b) Fatigue study Fatigue in work is natural. When the worker is given continuous work, he will get tired and lose speed and efficiency. He needs rest after working for a few hours. Scientific management studies the nature of work to determine the standard time for finishing the job and to find out when the workers need rest. The nature, time and period of rest are pre-determined. Necessary changes should also be made in the working methods and conditions to reduce fatigue.

(c) Taylor wanted to differentiate between efficient and inefficient workers. Under this system of wage payment, wages are paid on the basis of work done. According to him, higher rates were given to the workers who are producing standard products or more and lower rates were given to those who are producing less. e.g.
Standard output = 100 units/day
Wage rate 1 = ₹ 10/unit for standard output (100 units) or more
Wage rate 2 = ₹ 7/unit for below standard output
Worker 1 = Output 99 units
Wages = 99 × 7 = ₹ 693
Worker 2 = Output 101 units
Wages = 101 × 10 = ₹ 1010
Thus, a difference of ₹ 317 (1,010 – 693), for different of 2 units is enough to motivate the inefficient work for more output.

Question 74.
Explain following principles of general management.
(a) Scalar chain
(b) Equity
(c) Initiative (All India 2019)
Answer:
(a) Scalar chain It is the chain of superiors ranking from the top to the lowest ranks. The principle of scalar chain suggests that there should be a clear line of authority from top to bottom linking managers at all levels. The scalar chain serves as the chain of command and also as the chain of communication. Under the chain of command, orders and instructions, issued at higher levels, flow through intermediate managers before reaching the lower levels. The chain should not be violated in normal course of formal communication.
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 5

However, in emergency, communication can take place between two people working at the same level but in different departments, through gang plank. For example, if in XYZ Ltd, E wants to communicate with R. He will have to follow the path in chain like first he delivers information to D, then D to C, B, A, M, N, O and at last E transfers the message to R. But in case of emergency, E can directly contact with R according to the concept of gang plank.

(b) Equity: The principle of equity implies a 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 peon and supervisor.
But equity means application of same disciplinary rules, leave rules, etc irrespective of their grade, position and gender, language, religion or nationality, etc.
For example, the rules for granting medical leave to an employee should be same irrespective of their position, grade or gender.

(c) Initiative According to Fayol, ‘Initiative means taking the first step with self motivation, it is thinking out and executing the plan’. It is one of the traits of an intelligent person. Initiative should be encouraged because employees get satisfaction when they are allowed to take initiative. But it does not mean going against the established practices of the company for the sake of being different.

Question 75.
Karan Nath took over ‘D’ North Motor Company’ from his ailing father three months ago. In the past, the company was not performing well. Karan was determined to improve the company’s performance. He observed that the methods of production as well as selection of employees in the company were not scientific.
He believed that there was only one best method to maximise efficiency. He also felt that once the method is developed, the workers of the company should be trained to learn that ‘best method’.
He asked the Production Manager to develop the best method and carry out the necessary training. The Production Manager developed this method using several parameters right from deciding the sequence of operations, place for men, machines and raw materials till the delivery of the product to the customers. This method was implemented throughout the organisation. It helped in increasing the output, improving the quality and reducing the cost and wastage.
Identify and explain the principles and the technique of scientific management followed hy the Production Manager in the above case.CBSE 2018
Answer:
The principles of scientific management followed in the above case are :
(i) Science, not rule of thumb According to Taylor, each job should be performed in an organisation as per the scientific approach, as there is always one best method to maximise efficiency. This method can be developed through study and analysis. Selecting ‘one best method’ for activities can result in saving time, effort, money and resources.

(ii) Development of each and every person to his/her greatest efficiency According to this principle, ‘Each person should be scientifically selected and then assigned work as per their specialisation and in any case, if training is required, then impart training to them as efficient employees would produce more and earn more’. Worker training is essential to learn the ‘best method’ developed as per the scientific approach. This would ensure greatest efficiency for both, workers and the organisation.

The techniques of scientific management followed in this case are:
(i) Standardisation It is the process of setting standards for every business activity, process, raw materials, time, machinery and methods, to achieve efficiency. Standardisation of product implies that the size, design, quality, shape etc of the product should meet the requirements and tastes of consumers. Simplification means eliminating superfluous sizes, varieties and dimensions.
Its aim is to:

  • Eliminate unnecessary diversity of products and thereby reduce costs.
  • Help in achieving economy in the use of required machines and tools.

(ii) Method study This technique of scientific management is conducted to find out the ‘one best method or way’ of performing a particular task. The objective of this study is to minimise the cost of production and maximise the quality and satisfaction of the customer.

Question 76.
Explain any four characteristics of ‘principles of management.’ (Delhi 2016)
Or
Explain any four points that highlight the nature of principles of management. (Delhi 2016; Foreign 2016)
Or
Describe the nature of principles of management with the help of any four points. (All India 2016)
Answer:
Following points characterise the nature of management principles:
(i) Universal applicability These principles are universal and can be applied in all types of organisations whether it is profit making or non-profit making, small or large, private or government and manufacturing or service sector. They are equally applicable in a school, government office, military organisation, etc. They are also applicable to a limited company with separate departments like production, finance, marketing, etc.

(ii) General guidelines Management principles are general guidelines, as they cannot be applied blindly in all the situations. They do not provide readymade strait jacket solutions to all managerial problems, but only give the solution of a given problem.

(iii) Formed by practice and experimentation: The principles of management are developed after deep and thorough research work. Proper observations and experiments are conducted under different conditions by leaders and scholars of management thoughts to develop them. Thus, they contribute to development of management both as a science and an art. These are also evaluated on the basis of experience of managers.

(iv) Flexible The management principles are dynamic and not static or rigid prescriptions, which are to be followed absolutely. They are flexible in nature and can be modified by the manager as per the given situation.

Question 77.
Explain any four points which highlight . the importance of principles of management. (All India 2016; Foreign 2016)
Answer:
Four points which highlight the importance of principles of management are:
(i) To provide managers with useful insights into reality Principles help managers to improve their knowledge and understanding of managerial situations. These principles enable managers to learn from past mistakes and conserve time by solving recurring problems quickly. Hence, we can say, these principles provide managers an insight of real world situations.

(ii) Optimum utilisation of resources and effective administration We are aware of the fact that resources are limited in nature. Optimum utilisation of resources emphasise that resources should be utilised in such a manner that it should give maximum benefit with minimum cost. It also increases the efficiency of management, as through these principles managers adopt a systematic and logical approach to overcome the problems and discard hit and trial approaches.

(iii) Scientific decision Management principles help in thoughtful decision- making because they are based on logic rather than blind faith. Such decisions are free from bias and prejudice. These principles develop scientific approach as they give a realistic and subjective measurement for evaluation.

(iv) Meeting changing environment requirements Modem business environment is complex and ever-changing. In order to be successful, organisations have to adapt to these changes. Principles are dynamic in nature. They are flexible and frequently adapt to changes, which are favourable and profitable for the business.

Question 78.
With the help of a diagram explain ‘Functional Foremanship’ as a technique of scientific management. (Delhi 2015)
Answer:
Functional foremanship Taylor suggested functional foremanship for better supervision of workers. Under functional foremanship, there are specialist foremen for each job. He classified specialist foremen into two departments, namely planning and production departments. Both the departments have four foremen in all.

The names and functions of these foremen are as follows:
(i) Planning Department: Route clerk Determining the process of production and the route through which the raw materials will pass.

Instruction card clerk Laying down instructions according to which the workers are required to perform work.
Time and cost clerk Setting the time table for doing a job as per the pre-determined route and time schedule. He specifies the material and labour cost with respect to each operation.
Disciplinarian Maintaining proper discipline in the factory.

(ii) Production Department:
Gang boss Arranging machines, materials, tools, workers etc for the job.
Speed boss Maintaining the planned speed of production, investigating the causes for delay and remove them.
Repair boss Maintenance of the machines and equipments, proper arrangements for their oiling, greasing, cleaning and repair, preventing misuse of machines, etc.
Inspectors Seeing that the work confirms to the standard of quality laid down by the planning department.
Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2 Img 6

Question 79.
Explain the following techniques of scientific management (Delhi 2015)
(i) Differential piece wage system
(ii) Motion study
Answer:
(i) Differential piece wage system Differential piece wage system is the strongest motivator for a worker to reach standard performance. It is a method of wage payment in which efficient and inefficient workers are paid at different rates. In this method, increase in efficiency is co-related with an increase in the wage rate.

That is why, an efficient worker gets more wages, whereas, an inefficient worker gets less. Workers are paid on the basis of number of units produced. If a worker produces more than a certain number of units (standard output), he gets higher wage per piece/ units, on his total output. If he produces below the standard number, he gets lower rate per piece. Because of different rates of wage for different sets of workers, this is known as differential piece rate plan.

(ii) Motion study This is the analysis of physical movements in doing a work. Every work involves various forms of human movements such as lifting, holding, turning, etc. Under motion study, each movement is analysed to find out easier ways of doing the work and eliminate useless motions.
Following steps are involved in motion study:
(a) Selection of efficient workers.
(b) Analysis of the motions involved in a work.
(c) Finding the minimum time involved in doing a work.
(d) Keeping record of the best moves and unnecessary/unproductive actions.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 80.
Explain the following techniques of scientific management: (Delhi 2015)
(ii) Time study
(ii) Simplification of work
Answer:
(i) Time study It determines the standard time taken to perform a well-defined job. Time measuring devices were used to conduct this study. This type of study is helpful in deciding the time required to perform a job. It also helps in determining a fair day’s work for the workman and it also facilitates in determining incentive schemes and labour costs.

(ii) Simplification of work It means ehminating superfluous sizes, varieties and dimensions in a product. Its aim is to:

  • Eliminate unnecessary diversity of products and thereby reduce costs.
  • Helps in achieving economy in the use of required machines and tools.

Question 81.
Explain the following principles of management.
(i) Subordination of individual interest to general interest
(ii) Development of each and every person to his or her greatest efficiency (All India 2015)
Answer:
(i) Subordination of individual interest to general interest The interest of an organisation is to achieve its goals. These goals are achieved after integrating the efforts of different individuals who are working in the organisation to satisfy their own personal needs. Sometimes, an individual starts giving priority to his own interest.
Thus, the interests of various stakeholders, i.e. owners, shareholders, creditors, financers and the society cannot be sacrificed for one individual.

(ii) Development of each and every individual to his or her greatest efficiency According to this principle, ‘Each person should be scientifically selected and then assigned work as per their specialisation and in any case, if training is required, then impart training to them as efficient employees would produce more and earn more’.

If training is required, then impart training to thym as efficient employees would produce more and earn more’. Worker training is essential to learn the ‘best method’ developed as per the scientific approach. This would ensure greatest efficiency for both, workers and the organisation.

Multiple Choice Questions

Question 1.
Principles of management are not
(a) absolute
(b) flexible
(c) universal
(d) behavioural
Answer:
(a) absolute

Question 2.
Which of the following is not the principle of management given by Taylor?
(a) Cooperation, not individualism
(b) Science, not rule of thumb
(c) Harmony, not discord
(d) Functional foremanship
Answer:
(d) Functional foremanship

Question 3.
WTiat is the objective of functional foremanship?
(a) Improve quality of supervision of workers
(b) Improve quality of work
(c) Improve quality of production
(d) None of the above
Answer:
(a) Improve quality of supervision of workers

Hint:
The primary objective of functional foremanship is to improve the quality of supervision of workers. According to Taylor, a single worker or supervisor cannot be expected to be an expert in all aspects.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 4.
How are principles of management formed?
(a) By experience of customers
(b) By propagation of social scientists
(c) By experience of managers
(d) By scientists, in a laboratory
Answer:
(c) By experience of managers

Question 5.
Which of the following statements best describe the principle of division of work?
(a) Resources should be divided among jobs
(b) Labour should be divided
(c) Work should be divided into small tasks
(d) It leads to specialisation
Answer:
(c) Work should be divided into small tasks

Hint:
According to Fayol, if work is divided into small tasks and assigned to trained specialists, then it will help in taking the advantage of specialisation.

Question 6.
According to which principle, powers and duties should go hand in hand?
(a) Coordination
(b) Unity of direction
(c) Authority and responsibility
(d) Discipline
Answer:
(c) Authority and responsibility

Hint:
According to Fayol, there must be a balance between authority and responsibility. Excess of authority without matching responsibility may result in misuse of authority, whereas excess responsibility without adequate authority may lead to failure of organisational goals. Therefore, authority and responsibility should go hand in hand.

Question 7.
Under work study technique of scientific management, involves change in the attitude of workers and management. Both should realise the importance of the other and should cooperate with each other.
(a) functional foremanship
(b) standardisation and simplification of work
(c) mental revolution
(d) None of the above
Answer:
(c) mental revolution

Hint:
Mental revolution involves change in the attitude of workers and management. Both should aim to increase the size of surplus. Managers should share their gains with workers, while workers should contribute to increase profits. This attitude will bring prosperity to both, the company as well as the workers.

Question 8.
What is the main objective of simplification in scientific management?
(a) To determine the productive moments
(b) To determine the unproductive moments
(c) To determine the best possible way or method to perform a task
(d) To eliminate unnecessary diversity of products
Answer:
(d) To eliminate unnecessary diversity of products

Hint:
The main objective of simplification in scientific management is to eliminate unnecessary diversity of products. It results in saving cost of labour, machines and tools. It helps in achieving economy in the use of required machines and tools.

Question 9.
FW Taylor focuses on
(a) increasing productivity
(b) increasing profit
(c) minimising productivity
(d) minimising growth
Answer:
(a) increasing productivity

Question 10.
Gang plank is introduced in which principle?
(a) Authority and responsibility
(b) Initiative
(c) Scalar chain
(d) Coordination
Answer:
(c) Scalar chain

Question 11.
“He/she keeps machines, materials, tools etc ready for operations by concerned workers”. Whose work is described by this sentence under functional foremanship?
(a) Instruction and clerk
(b) Repair boss
(c) Gang boss
(d) Route clerk
Answer:
(c) Gang boss

Hint:
Gang boss keeps machines, materials, tools etc ready for operations by concerned workers, i.e. he is responsible for keeping machines and tools Hint
ready for work.

Question 12.
The principles of management is significant because of
(a) initiative
(b) adaptation to changing technology
(c) optimum utilisation of resources
(d) increase in efficiency
Answer:
(d) increase in efficiency

Hint:
The principles of management helps in increasing efficiency in production as the principles lay down the general guidelines so that a manager can take valuable decisions or appropriate steps to accomplish desired goals.

Principles of Management Class 12 Important Questions and Answers Business Studies Chapter 2

Question 13.
This technique of scientific management has an objective to find out how long person can perform the standard task without any adverse effects. Which technique is discussed here?
(a) Work study technique
(b) Motion study technique
(c) Fatigue study technique
(d) Differential piece wage system
Answer:
(c) Fatigue study technique

Question 14.
Which of the following statement is incorrect?
(a) The aim of both Taylor and Fayol is to maximise the efficiency and achieve the aims
(b) Taylor and Fayol both advocated on division of work and responsibility
(c) Both Taylor and Fayol have contributed immensely to the knowledge of management
(d) None of the above
Answer:
(d) None of the above

Hint:
None of the above statements are incorrect as Taylor and Fayol, both focused on maintaining good industrial relations. They give solutions to managerial problems. They presented a systematic study on management. Both of them develop their ideas, thoughts and principles after a thorough analysis and experimentation.