NCERT Solutions Class 12 Business Studies Chapter 2 Principles of management

NCERT Solutions for Class 12 Business Studies Chapter 2 Principles of Management Short Answer Type Questions

Question. How is principle of unity of command useful to management?
Answer:  One subordinate and one boss. Aims at avoiding duplication, overlapping and confusion & five responsibilities. If this principle is violated, it will lead to

1. it will be very difficult to maintain discipline
2. duplication of work
3. over – lapping of orders and instructions
4. disobeying the orders of superiors
5. escaping responsibility
6. disrespect to the work and officers

Question. Define scientific management. State any three of its principles.
Answer:  Scientific management means knowing exactly what you want men to do and seeing that they do it in best and cheapest way. Three of its principles are

1. Science not Rule of Thumb
2. Harmony, Not discord
3. Cooperation Not Individualism

Question. If an organisation does not provide the right place for physical and human resources in an organisation, which principle is violated? What are the consequences of it?
Answer:  Principle of order is violated here. According to this principle, people and material must be in suitable places at appropriate time for maximum efficiency. If this principle is violated it leads to chaos and delay in work.

Question. Explain any four points regarding significance of Principles of management.
Answer : The study of principles of management is important due to the following reasons:

1. Optimum utilisation of resources & effective administration: The principles of management serve as a guideline for doing work with greater efficiency. It helps managers to take a more realistic view of different managerial problems and to direct human behavior effectively.
2. Fulfilling social responsibility: The principles of management advocate fulfillment of social responsibilities by corporate. It induces companies to take care of customer satisfaction, environment as well as fair dealings with business associates.
3. Meeting changing environment requirement: The principles of management help the managers in adapting to the dynamic business environment.
4. Management training, education and research: The principles of management provides conceptual framework for systematic training and development of future managers.

Question. Explain the principle of ‘Scalar chain’ and gang plank.
Answer:  Principle of scalar chain:

This principle states that there is a proper chain of authority and responsibility which moves in a straight line from the superior most authority down to the lowest subordinate. Under this chain or line of authority, each communication moves from top to lower level and vice versa. One important consideration here is that no step has to be overlooked or skipped. Fayol has explained this principle with the help of the double chain.

To avoid the consequential delay in case of an urgent message, Fayol suggested the concept of ‘GANG PLANK’. Sometimes the official scalar chain is compromised to communicate for urgent matters. This is done through gang plank.

NCERT Solutions for Class 12 Business Studies Chapter 2 Principles of Management Long Answer Type Questions

Question. Explain the principles of Scientific management given by Taylor.
Answer: The scientific principles are:

1. Science, not rule of thumb – According to this principle, Taylor insists that each job to be performed in the organisation should be based on scientific enquiry and not on intuition, experience, and hit and trial method. Taylor believed that there was only one best method to maximise efficiency and this method can be developed through study and analysis.

2. Harmony, not discord – According to this principle, those who work together in an organisation must work in harmony, i.e., with mutual give and take, and proper understanding. He insists that there should be mental revolution between management and workers. As per him, management should share the gains of the company, if any, with the workers and at the same time workers should work hard for the prosperity of the company.

1. Cooperation, not individualism – According to this principle, work must be carried on in cooperation with each other, with mutual confidence and understanding for each other. There should be complete cooperation between the labour and the management instead of individualism. Competition should be replaced by cooperation. Workers should be part of the management and, if any important decisions are taken, workers should be taken into confidence. At the same time, workers should avoid making unreasonable demands on the management.

4. Development of workers to their greatest efficiency and prosperity – Taylor believed that efficiency needs to originate right from the process of employee selection. Each person should be scientifically selected. Then work assigned should suit her/his physical, mental and intellectual capabilities.

Question. Explain the following Principles of management given by Fayol with examples:

1. Unity of direction.
2. Equity
3. Espirit de corps.
4. Order
5. Centralisation and decentralisation.
6. Initiative

Answer:

1. Unity of direction: Accoding to this principkle, each group of activities having the same objective must have one head and one plan .
2. Equity: This principle suggests that managers should be fair and impartial while dealing with their subordinates.
3. Espirit de corps: The principle of Espirit De Corps says that management should promote team spirit of unity and harmony among employees. Management should promote teamwork especially in large organisations.
4. Order: According to this principle, people and material must be in suitable places at appropriate time for maximum efficiency. If this principle is violated it leads to chaos and delay in work.
5. Centralisation and decentralisation: Fayol's principle of centralisation and decentralisation confirms that there should be a proper balance between centralisation and decentralisation. Too much centralisation would delay key decisions and too much decentralisation would create chaos and disorder in the organisaton.
6. Initiative: The successful management provides an opportunity to its employees to suggest their new ideas, experiences and more convenient methods of work. So according to this principle, it is the duty of the manager to encourage the feeling of initiative among the employees for doing some work or taking some decisions but within the parameters of authority and discipline.

Question. Explain the technique of functional foremanship and the concept of mental revolution as enunciated by Taylor.
Answer: Functional Foremanship: Taylor propounded functional organisation. This form of oganisation is totally based on principle of specialisation and makes full utilisation of expertise of various experts. In a functional organisation, work is divided into small parts and each part is assigned to expert. Mental revolution: It suggests change in the attitude of workers and management towards one another, from competition to co-operation.

Question. Discuss the following techniques of Scientific Work Study:

1. Time Study.
2. Motion study.
3. Fatigue Study.
4. Method Study.
5. Simplification and stanardisation of work.

Answer:

1. Time study: It is one of the techniques of management, suggested by F W Taylor, that is used to measure the time that may be taken by a workman of reasonable skill and efficiency to perform various elements of job
2. Motion study: It refers to the study of movements like lifting, putting objects, sitting, changing positions etc. that are undertaken while doing a typical job. Its purpose is to eliminate the unnecessary movements so that job can be completed in less time. As per him, it is possible to find out –
   1. Motions that are productive (ii) Motions that are incidental
   2. Motions that are unproductive Taylor used stop watches and various symbols and colours to identify different motions.

Through this study, Taylor designed suitable equipments and tools to educate workers on their use.

1. Fatigue study: It determines the amount and frequency of rest intervals in completing a task. As per Taylor, a person is bound to feel tired, physically and mentally, by working continuously. The rest intervals will help one to regain stamina and work again with the same capacity for increased productivity.

Taylor suggested that time period and frequency of the rest interval should be decided by conducting scientific approach.

1. Method study: The objective of method study is to find the one best way of doing a job. The objective is to minimise the cost of production and to maximise satisfaction.
2. Simplification and standardisation of work: Scientific method should be used to analyse methods of production prevalent under rule of thumb. Standardisation is the process of setting standards for every business activity, with the aim of reducing a given product to fixed types, sizes, characteristics.

Question. Discuss the differences between the contributions of Taylor and Fayol.
Answer:

Basis	Taylor	Fayol
Perspective	Taylor started his	Fayol started
	studies and	his studies and
	approach from	approach from
	lowest level in the	the highest
	organisation.	level in the
		organisation.
Focus	Focuses on	Focuses on
	eliminating	development of
	wasteful	principles for
	movements and	better

 

	saving energy of	management
	workers
Concern	Taylor’s	Fayol’s
	techniques and	principles are
	principles are	concerned with
	concerned with	management
	worker’s	efficiency.
	efficiency.
Applicability	Taylor’s	Fayol’s
	techniques and	principles are
	principles are	universally
	applicable to	applicable.
	specialised
	situation.
Personality	Taylor developed a	Fayol developed
	personality of	the personality
	scientist and	of a researcher
	became famous as	and practitioner
	Father of Scientific	and became
	Management.	famous as
		Father of
		General
		Management.
Contribution	Major contribution	Main
	was development	contribution
	of scientific	was
	techniques and	development of
	scientific principles	fourteen
		principles of
		general
		management

Question. Discuss the relevance of Taylor and Fayol’s contribution in the contemporary business environment.
Answer: Principles of Taylor and Fayol play an important role in contemporary business environment. They aim at establishing a cause & effect relationship. They provide general guidelines to action and not ready made solution to management problems. Managers can help them in taking decisions and solving problems. They provide are developed over time by experiments and observations. These principles aim at improving efficiency and also emphasis on coordination and harmonious environment to work. They also provide insight into different business situations.

Multiple Choice :

Question. Principles of management are not

Answer: c) absolute.

Question. How are principles of management formed?

1. In a laboratory.
2. By experiences of managers.
3. By experiences of customers.
4. By propagation of social scientists.

Answer: b) By experiences of managers.

Question. The principles of management are significant because of

1. Increase in efficiency.
2. Initiative
3. Optimum utilisation of resources.
4. Adaptation to changing technology.

Answer: c) Optimum utilisation of resources.

Question. Henry Fayol was a

1. Social Scientist.
2. Mining Engineer.
3. Accountant
4. Production engineer.

Answer: b) Mining Engineer.

Question. Which of the following statement best describes the principle Division of Work.’

1. Work should be divided into same tasks.
2. Labour should be divided
3. Resources should be divided among jobs.
4. It leads to specialisation.

Answer: a) Work should be divided into same tasks.

Question. She/ he keeps machines, materials, tools, etc., ready for operations by concerned workers.’ Whose work is describes by this sentence under functional foremanship

1. Instruction Card Clerk.
2. Repair Boss.
3. Gang Boss.
4. Route Clerk.

Answer: c) Gang boss.

Question. Which of the following is NOT a Principle of management given by Taylor?

1. Science, not rule of the Thumb.
2. Functional foremanship.
3. Maximum not restricted output.
4. Harmony not discord.

Answer: b) Functional foremanship.

Question. Manageemnt should find ‘One best way’ to perform a task. Which technique of Scientific management is defined in this sentence?

1. Time Study
2. Motion Study
3. Fatigue Study
4. Method study.

Answer: d. Method Study.

Question. Which of the following statements best describes ‘Mental Revolution’?

1. It implies change of attitude.
2. The management and workers should not play the game of one upmanship.
3. Both management and workers require each other.
4. Workers should be paid more wages.

Answer: a) It implies change of attitude.

Question. Which of the following statements is FALSE about Taylor and Fayol?

1. Fayol was a mining engineer where as taylor is a mechanical engineer.
2. Fayol’s principles are applicable in specialised situations whereas Taylors principles have universal application.
3. Fayol’s principles were formed through p[ersonal experience whereas Taylors principles were formed through experimentation.
4. Fayol’s principles are applicable at the top level of management where as Taylors principles are applicable at the shop floor.

Answer - b) Fayol’s principles are applicable in specialised situations whereas Taylors principles have universal application.

Case Studies:

Question. ‘F’ limited was engaged in the business of food processing and selling its products under a popular brand. Lately the business was expanding due to good quality and reasonable prices. Also with more people working the market for processed food was increasing. New players were also coming to cash in on the new trend. In order to keep its market share in the short run the company directed its existing workforce to work overtime.

But this resulted in many problems. Due to increased pressure to work the efficiency of the workers declined. Sometimes the subordinates had to work for more than one superior resulting in declining efficiency. The divisions that were previously working on one product were also made to work on two or more products. This resulted in a lot of overlapping and wastage. The workers were becoming undisciplined. The spirit of teamwork, which had characterised the company, previously was beginning to wane. Workers were feeling cheated and initiative was declining. The quality of the products was beginning to decline and market share was on the verge of decease.

Actually the company had implemented changes without creating the required infrastructure.

Questions: Identify the Principles of Management (out of 14 given by Henry Fayol) that were being violated by the company.

1. Explain these principles in brief.
2. What steps should the company management take in relation to the above principles to restore the company to its past glory?

Answer:

1. Principle of division of work: This is evident from the lines: ‘divisions that were previously working on one product were also made to work on two or more products.’
2. Principle of Esprit de corps: This is evident from lines: ‘The spirit of teamwork, which had characterised the company, previously was beginning to wane.’
3. Principle of Discipline: This is evident from line: ‘The workers were becoming undisciplined.’
4. Principle of initiative: This conclusion can be drawn from the lines: ‘Workers were feeling cheated and initiative was declining.’
5. Principle of division of work: This principle of Fayol states that as far as possible the work should be divided into different parts and each individual should be assigned only one part of the work according to his ability and capability. When a particular individual will do the same work repeatedly, he will become an expert in doing that particulat task and hence benefits of specialisation will be achieved.
6. Principle of Esprit de corps: management principles suggested by Fayol states the need for unity among employees. Esprit de corps states that unity is strength.
7. Principle of Discipline: states that there should be obedience, proper conduct in relation to others, respect of authority and complying with the rules and regulations of the organisation
8. Principle of initiative: Fayol's principle of initiative recommends that workers should be encouraged to develop new ideas and suggestions for the betterment of the organisation.

3.Steps should the company management take in relation to the above principles to restore the company to its past glory are:

1. Specialisation in work must be followed.
2. Instructions must be given by one superior only to avoid confusion and chaos.
3. More focus should be on team work.
4. Scientific management must be followed.

Question. The management of company ‘F’ Limited now realised its folly. In order to rectify the situation it appointed a management consultant ‘M’ consultants to recommend a restructure plan to bring the company back on the rails. ‘M’ consultants undertook a study of the production process at the plant of the company ‘F’ Limited and recommended the following changes:

1. The company should introduce scientific management with regard to production.
2. Production, planning including routing, scheduling, dispatching and feedback should be implemented.
3. In order to separate planning from operational management ‘Functional foremanship’ should be introduced.
4. Work study must be undertaken to optimise the use of resources.
5. Standardisation of all the activities must be implemented increase efficiency and accountability.
6. To motivate the workers ‘Differential Piece Rate System’ should be implemented.
7. The above changes should be introduced apart from the steps recommended in case problem-I (as an answer to question no 3 of that case problem)

It was expected that changes will bring about a radical transformation in the working of the company and it will regain its pristine glory.

Questions:
1. Do you think that introduction of scientific management as recommended by M consultants will result in intended outcome?
2. What precautions should the company undertake to implement the changes?

Give your answer with regard to each technique separately as enunciated in points 1 through 6 in case problem.

Answer:

1. Yes, introduction of scientific management as recommended by M consultants will be helpful to the organisation. On implementing scientific management, the work will be simplified and standardised. Motivation and work study will help in reducing cost and increasing profits.
2. Precautions should the company undertake to implement the changes are:

• planning should be done for production process.
• Standardisation should be used in different situations.
• Qualified, trained and specialised staff shall be recruited.
• Different methods of motivation shall be used to encourage the employees.

NCERT Solutions for Class 12 Business Studies Chapter 2 Principles of Management Short Answer Type Questions

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

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

Question. 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 popular. 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 the 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.
Answer: The techniques of scientific management used by Riya :
(i) Motion study : Motion means close observation of the movements of a worker’s body involved in performing a job and of a machine. Its objective is to eliminate the unproductive motions of both man and machine.
(ii) Time Study : Time study is the art of observing and recording the time required to perform each detailed task of an industrial operation.
(iii) Standardisation and simplification of work :
Standardisation of work refers to the process of setting standards of every industrial activity to maximise output. Scientific management calls for standardisation of methods, processes, product, machinery, raw materials etc. Simplification involves elimination of unnecessary diversification of products related to size and varieties, as more
varieties mean high inventory and higher labour cost etc. By simplifying the task, there will be economy in use of machines, labour, inventory maintenance etc. It will also help in improving the product quality and reduction of cost.

Question. Explain briefly ‘Remuneration of Employees’ and ‘Scalar Chain’ as general principles of management.
OR Explain the principle of ‘Scalar Chain’ and Gang Plank.
Answer: (i) Remuneration of employees: It states that the remuneration of employees should be justifiable and equitable.
Employees should be paid fair wages, which should give them at least a reasonable standard of living. At the same time, it should be within the paying capacity of the company.
(ii) Scalar chain: It refers to chain of authority and communication that runs from top to bottom and should be followed by the managers and the subordinates. For example: There is one head A who has two lines of authority under him, B-C-D and L-M-N. If D has to communicate with N who is at the same level of authority, then he has to transverse the rout D-C-B-A-L-M-N due to the principle of scalar chain. 

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

Question. Explain ‘unity of command’ and ‘equity’ as principles of general management.
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 of sense of fairness and justice to all workers working in an organisation. Observance of equity alone would make workers loyal and devoted to the organisation. Equity does not mean equal salary to a peon and supervisor. But equity means application of same disciplinary rules, leave rules, etc. irrespective of their grade, positions and gender, language, religion or nationality, etc.

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

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

Question. Explain the following Principles of Management : 
(i)Remuneration of Employees. 
Answer:  Remuneration of Employees : Fayol suggested that remuneration should be fair and reasonable. The method of remuneration should be simple and understandable. It should be satisfactory
to both employees and employers. It should be directly associated with efforts. Remuneration should be fixed on the basis of work assigned, cost of living and financial position of the business.

Question. Explain the following principles of manage-ment :
(i) Development of each and every person to his or her greatest efficiency.
Answer:
(i) Development of each and every person 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. Worker training is essential to learn the best method developed as per the scientific approach. This would ensure greatest efficiency for both, worker and the organisation.

NCERT Solutions for Class 12 Business Studies Chapter 2 Principles of Management Long Answer Type Questions

Question. Principles of Taylor and Fayol are mutually complementary. One believed that the 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 to in the above para. 
Answer: The principle of Taylor referred to is Cooperation, not individualism. It states that there should be complete cooperation between the labour and management. Competition should be replaced by Cooperation.
(ii) The principle of Fayol referred to is Initiative. It indicates that the subordinates should be encouraged to make and execute plans within the prescribed limits of authority.

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

Question. Explain any two techniques of Taylor’s Scientific Management.
OR Explain Method Study and Motion Study as techniques of Scientific management.
Answer: Techniques of Scientific Management :
(i) Method study : Method study means to develop best method of work. Its main aim is to maximise efficiency in the use of materials, machinery, manpower and capital by improving working methods.
(ii) Motion study : Motion means close observation of the movements of a worker’s body involved in performing a job and of a machine. Its objective is to eliminate the unproductive motions of both man and machine.
(iii) Time study : Time Study is the art of observing and recording the time required to perform each detailed task of an industrial operation.
(iv) Fatigue study : Helps in determining the time interval and frequency of rest periods so that workers can work with the full capacity.
(v) Differential piece wage system : Under this system, efficient workers are paid at a higher rate than the inefficient workers and workers are paid on the basis of number of pieces produced.
(vi) Functional foremanship : To improve the quality of supervision of workers, Taylor developed the idea of functional foremanship. The term ‘functional foremanship’ means separation of planning from execution. Each worker is supervised by various specialists.
For this, Taylor suggested setting up of two departments-Planning and Production. The main function of the planning department is to plan all aspects of a job to be performed.

Question. Explain any four points which highlight the importance of principles of management.
Answer: Importance of principles of management :
(i) Provide the managers with useful insights into reality.
(ii) Helps in optimum utilisation of resources and effective administration.
(iii) Helps in taking scientific decisions.
(iv) Helps in meeting changing environment requirements.
(v) Helps in fulfilling social responsibility.
(vi) Used as a basis for management training, education and research.

Question. 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. 
Answer:
(i) ‘Harmony, Not Discord’ : Taylor emphasised that there should be complete harmony between the management and the workers. Both should realise that conflict between them is not going to help only one. Taylor called for complete mental revolution on the part of both the management and workers. To achieve this, management should share the gains of the company if any, with the workers. At the same time workers should work hard and be willing to embrace change for the betterment of the company. He advocated for mental revolution i.e., change in mind set of both the management and workers. Both should realise that their objective is one and it lies in the prosperity of the organisation only.
(ii) Fayol's Principle of Fair Remuneration : The overall pay and compensation should be fair to both employees and the organisation. The employees should be paid fair wages, which should give them at least a reasonable standard of living. At the same time, it should be within the paying capacity of the organisation. In other words, remuneration should be just, and fair. This will ensure congenial atmosphere and good relations between workers and management. Consequently the working of the company would be smooth.

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

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

Question. Explain the following techniques of Scientific Management :
(i) Time Study; and (ii) Simplification of Work. 
Answer: (i) Time Study : It is a technique which is used to determine the standard time taken by a worker to perform a well-defined job. It determines how much work an employee should be able to do in a given period of time. The objectives of time study are :
(a) To determine the number of workers required to do a job.
(b) To determine standard time required to perform a job.
(c) To categorise the workers in efficient and inefficient categories.
(d) To determine the cost of labour.
(ii) Simplification of Work : If refers to eliminating unnecessary varieties, sizes and grades of the product manufactured by the organisation.
(a) The aim is to eliminate unnecessary diversity of products, sizes and types.
(b) It results in saving of cost of labour, machines and tools.
(c) It implies reduced inventories, fuller utilisation of equipment and increasing turnover.

Question. Explain the following principles of Fayol with the help of one example of each :
(i) Stability of Tenure of Personnel.
Answer: (i) Stability of Tenure of Personnel : According to this principle, employees should not be moved from their positions frequently. Fayol was of the view that employees should be selected and appointed after due and rigorous procedure. Once selected, they should be kept at their position for a minimum period and must be given reasonable time to show results. Stability creates a sense of belongingness and workers are encouraged to improve quality and quantity of work. Continuous transfer of employees disturbs the production process. So, it is always in the interest of the enterprise that the trusted, experienced and trained employees do not leave the organisation.

Question. Explain the following principles of Fayol with the help of one example of each :
(i) Division of Work. 
Answer: Division of Work : According to this principle, work should be divided into small specialised tasks. Each task should be performed by a specialist or trained employee. Division of work leads to specialisation. For example, If one person is skilled in computer programming and continues to do that for over a period of time, his continuity of computerised work makes him a specialist in that job and consequently improves his performance. 

Question. Explain the following principles of management : (i) Science, not Rule-of-Thumb. (ii) Harmony, not Discord. (iii) Development of Each and Every Person to His or Her Greatest Efficiency.
Answer: (i) Science not Rule of Thumb : (a) It states that there is only one best method to maximise efficiency. (b) This method can be developed through scientific study and analysis of each element of a job and should substitute ‘Rule of Thumb’. (c) This standard method then should be followed throughout the organisation. It means usage of logical and scientific methods for taking decisions instead of relying on instinct. According to Taylor, for every work there is only one method of doing it which can be ascertained by logic and not with the help of hit and trial method. This helps in saving time and increasing efficiency to a large extent.
(ii) Harmony, Not Discord : (a) The principle emphasises that there should be complete harmony between the management and the workers. (Given by Taylor) (b) Group action with mutual trust and understanding should be the focus of working. (c) This principle requires that there should be complete harmony between the management and workers and both should feel that they are part of the same family.
(d) Management should share gains of the company if any with the workers and the workers should work hard and be willing to embrace change for the good of the company.
(e) Development of each and every person to his or her greatest efficiency and prosperity : This principle stands for the development of workers through trainings in order to learn the best methods developed through the use of scientific approach. The work assigned to each person should suit his/her physical, mental and intellectual capabilities. Efficient workers produce more to earn more.
This ultimately helps to attain efficiency and prosperity for both organisation and workers.

Question. Explain the technique of simplification and standardisation of work given by Taylor.  
Answer: Standardisation of work refers to the process of setting standards of every industrial activity to maximise output. Scientific management calls for standardisation of methods, processes, product, machinery, raw materials, etc. The objectives of standardisation are as follows :
(i) To reduce given line of product to fixed types, size and characteristics.
(ii) To establish standards of excellence and quality in material.
(iii) To establish standards of performance of workers and machines. Simplification involves elimination of unnecessary diversification of products related to size and varieties, as more varieties mean high inventory and higher labour cost etc. By simplifying the task, there will be economy in use of machines, labour, inventory maintenance, etc. It will also help in improving the product quality and reduction of cost.
The management must carry out work study to standardise and simplify work in order to increase efficiency. For standardising the work, work study can be done through techniques like method study, motion study, time study and fatigue study.

Question. 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. emphasizes 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 team work. By doing so managers of Deewan Ltd. are following some principles of management. Identify and explain any two such principles.
Answer: The two principles of management followed by managers of Dewan Ltd are : Equity :
(i) Equity states that there should be no discrimination against anyone on account of sex, religion, language, caste, belief, nationality etc.
(ii) It emphasises kindliness and justice in the behaviour of managers towards the workers to ensure loyalty and devotion. Espirit de Corps :
(i) Management should promote team spirit of unity and harmony among employees.
(ii) This will give rise to spirit of mutual trust and belongingness among team members and will minimise the need for using penalties.

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

Question. With the help of a diagram explain ‘Functional Foremanship’ as a technique of scientific Management.
Answer: Functional Foremanship : A foreman refers to a person who is in charge of the operational-level workers. According to this technique, the planning and the production functions should be separated. That is, under the manager, there should be one planning incharge and one production incharge. Each incharge should have four personnel under him/ her. The following are the four persons that work under the Planning Incharge :
(i) Instruction Card Clerk : To give instructions to the workers.
(ii) Route Clerk : To show the route of production.
(iii) Time and Cost Clerk : To take care of the time and costs.
(iv) Disciplinarian : To ensure that discipline is being maintained. The following are the four persons that work under the Production Incharge :
(i) Speed Boss : To ensure timely completion of tasks.
(ii) Gang Boss : To keep the machines and tools ready for the workers.
(iii) Repairs Boss : To ensure proper working of the machines.
(iv) Inspector : To control the quality of work done.The technique of 'Functional Foremanship' has been diagrammatically presented below :

Question. Explain the following principles of management :
(i) Scalar chain.
(ii) Discipline.
(iii) Subordination of Individual Interest to General Interest.
Answer: (i) Scalar Chain : Scalar Chain is the chain of superiors ranging from the highest level of authority to the lowest level in an organisation. Any communication going up or coming down should follow this chain. Fayol has suggested gang plank which is the system of direct communication between two employees not in the same chain to prevent scalar chain from bogging communication flow. Any communication from A coming downward will follow the chain A to B to C to D and to E. In upward direction, the reverse sequence will be followed. The same pattern will be followed in communication between A and I. 
and fair agreement and judicious application of penalties.
(c) Workers and management both should honour their commitments towards one another without prejudice. According to Fayol, an organisation must follow and ensure the conformity of certain set of rules, regulations and policies. Discipline is required for both superiors and subordinates. It also advocates judicious application of penalties by management. It helps in :
(a) Systematic working in the organisation.
(b) Developing mutual trust among people.
(iii) Subordination of individual interest to general interest :
(a) According to this principle, interests of the organisation must supersede that of the individual.
(b) For the attainment of common goals of an organisation, employees are required to give up their personal interest. They all should focus their efforts on the achievement of common goals.
(c) Given by Fayol.
For example, a Sales Manager was on a leave to attend some family function at Chandigarh. Suddenly, he got a note from the top level management. He was required to attend some urgent official meeting in Mumbai. He immediately rushed to Mumbai and attended the meeting. In such a situation, he sacrificed his individual interest and gave more priority to the organisational objective.

Question. 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.
Answer: (i) The principle of Fayol : Division of work. It states that the work should be divided into small jobs, each performed by a specialist employee.
(ii) The principle referred by Taylor : Development of each and every person to his or her greatest efficiency and prosperity. It states that to increase efficiency, each person should be selected scientifically, assigned the jobs on the basis of his/her capabilities and subsequently given the right training to learn the one best method to do a job.

Question. Explain the following techniques of scientific management :
(i) Differential Piece Wage System; and (ii) Motion Study.
Answer: (i) Differential Piece Wage System : This technique is the strongest motivator for a worker to reach standard performance. To motivate the workers, Taylor has advised the adoption of differential piece rate system. This system emphasizes on paying different rate of wage for efficient and inefficient
employees. In this two different wage rates are used : one is the higher wage rate and the other is the lower wage rate and the basic aim of fixing two different rates is to differentiate between efficient and inefficient workers and to suitably reward the efficient workers. Higher wage rates are fixed for those workers who produce equal to or more than the standard output and lower wage rates are fixed for those workers who do not reach the standard output.
For example, if standard production is fixed at 10 units per day and rates are fixed as follows : Wages rate below standard output : ₹ 20 per unit Wages rate above standard output : ₹ 50 per unit If a worker 'A' produces 12 units then he will get ₹ 600 (12 unit × ₹ 50 per unit). If another worker 'B' produces 9 units, then he will get ₹ 180 (9 units × ₹ 20 per unit). According to Taylor, this difference in wages will motivate the workers to become efficient and earn more.
(ii) Motion Study : It refers to observing and noting down all the movements of an average worker while doing the job. Motion study helps to save time and increase the production. While identifying different motions, Taylor used stopwatches and various symbols and colours. In recent times, video-graphics can be used to identify different motions. The objectives of Motion Study are :
(a) To determine the movements of workers involved in performing a job. (b) To identify productive and unproductive movements.
(c) To minimise the unproductive movements of workers.
(d) To eliminate wasteful movements. With better working condition, motion study improves efficiency and productivity.

Question. Flavours Ltd. was engaged in the business of making handmade chocolates. Lately, the business was expanding due to good quality and reasonable prices. As the demand was increasing, Flavours Ltd. decided to explore bakery products as well. In order to make bakery products the company directed its workforce to work overtime but this resulted in multiple problems. Due to increased pressure the efficiency declined and the workers had to take orders from more than one superior. Workers were overburdened and their health was also affected. Gradually the quality of the products begins to decline and market share also went down. The company realized that they had implemented changes without waiting for the required infrastructure. Identify and explain the principles/technique of Taylor/Fayol referred to in the above para.
Answer: (i) Unity of Command : According to Fayol there should be one and only one boss for every individual employee. If an employee gets orders from two superiors at the same time the principle of unity of command is violated. The principle of unity of command states that each participant in a formal organisation should receive orders from and be responsible to only one superior. Fayol gave a lot of importance to this principle.
(ii) Fatigue Study : A person is bound to feel tired physically and mentally if she/he does not rest while working. The rest intervals will help one to regain stamina and work again with the same capacity. This will result in increased productivity. Fatigue study seeks to determine the amount and frequency of rest intervals in completing a task.

Question. 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 by the Production Manager in the above case.
Answer: Principles of management followed in the above case :
(i) Science, not rule of thumb :
(a) It states that there was only one best method to maximise efficiency.
(b) This method can be developed through scientific study and analysis of each element of a job and should substitute ‘Rule of Thumb’.
(c) This standard method then should be followed throughout the organisation. 
(ii) Development of each and every person to his greatest efficiency and prosperity :
(a) This principle is concerned with efficiency of employees which could be built in right from the process of employee selection.
(b) The work assigned to employees should suit their capabilities. They should be given the required training to increase their efficiency.
(c) Efficient employees would produce more and earn more. This will ensure their greatest efficiency and prosperity for both the company and the workers.
Technique of scientific management followed in the above case :
(i) Method Study :
(a) It is a study to find out one best way of doing the job.
(b) It helps to minimize the cost of production, improve the quality and maximize satisfaction of the customer.
(c) It includes all activities from procurement of raw materials till the final product is delivered to the customer.