Anna University Engineering Question Bank MG 1351 - Principles of Management

UNIT I - OVERVIEW OF MANAGEMENT 2Marks

1. Define Management. Management is the process of designing and maintaining of an environment in which individuals working together in groups efficiently accomplish selected aims. Management is the art of getting things through and with people in formally organized groups. Ex: Human Resource Management, Financial Management.

2. Is Management - an art or science? Management is the art of getting things done from people. It has the following features that make it an art. Creative Individual approach Application and dedication Initiative and Intelligence. Management also involves a systematic approach towards designing and maintaining an environment in which individuals work together in groups to effectively accomplish selected aims. The following features make it a science. Systematic decision making Universal management process Situational output and 1

 Universally accepted management. Thus management can be called both as an art and science.

3. Give some features of Management. Management is the process of designing and maintaining an environment in which individuals working together in groups effectively accomplish selected aims. The features of Management include: Purposeful and goal oriented Dynamic Multidisciplinary Jobs accomplished by others Associated with groups Intangible Continuous process and It is aided but not replaced by computers.

4. What are the essential skills of Managers? Skill refers to expertness, practical ability, or facility in an action or doing something. The major skills required or expected out of managers are: Technical skills Pertaining to knowledge and proficiency in activities involving methods and procedures; Human skills Ability to work effectively with other persons and to build up cooperative group relations to accomplish organizational objectives; Conceptual skills Ability to recognize significant elements in a situation; and to understand the relationship among those elements; and Design skills Ability to solve problems in ways that will benefit the enterprise. 5. Define Scientific Management. 2

Scientific management involves specific method of determination of facts through observation. The concept of scientific management was introduced by Frederick Winslow Taylor in the USA in the beginning of 20th century. It was further carried on by Frank and Lillian Gilbreth, Henry Gantt, etc. It was concerned essentially with improving the operational efficiency at the shop floor level. Scientific Management is concerned with knowing exactly what you want men to do and then see in that they do it best and cheapest way.

6. List the principles of Scientific Management. Scientific management was introduced by F.W Taylor who is known as the Father of Scientific Management. He adopted scientific methods to increase the productivity and greater efficiency in production. The principles of Scientific Management are:Separation of planning and working Functional foremanship Job analyzers Time study Motion study Fatigue study Standardization Scientific selection of training Financial incentives and Economy and mental revolution.

7. What is the Rule of the Thumb? Traditionally a rule was used in management that laid emphasis on estimation rather than precision. Prior to scientific management, skilled craftsmen who had learned their jobs in lengthy apprenticeships performed work. They made their own decisions about how their job was to be performed. This is known as the Rule of the thumb.

It lays emphasis on estimating a situations solution. This rule was replaced by F.W Taylors rule of Scientific Management.

8. List the contributions of Fayol towards Management. Henry Fayol is a French industrialist whose contributions are termed as operational management or administrative management. He followed The Classical Approach to the evolution of management thought. His contributions are given as follows:Grouping of activities of an industrial organization into six groups, namelyTechnical, commercial, financial, security, accounting and managerial; Identified six types of qualities of a manager are- Physical, mental, moral, educational, technical and experience; Fourteen principles of Management namely- Division of Work, Authority and responsibility and so on; and Five elements/functions of management- Planning, organizing, commanding, coordinating and controlling.

9. What do you mean by Scalar Chain? Scalar Chain is the number of different levels of authority through which decisions are passed in the organization. It suggests that each communication going up or coming down must flow through each position in the line of authority. The scalar chain of command of reporting relationships from top executive to the ordinary shop operative or driver needs to be sensible, clear and understood. The same levels of hierarchical positioned people in different departments of an Organization communicate with each other by establishing a plank.

10. What do you mean by Espirit de Corps? Henri Fayol emphasized the need for building and maintaining of harmony among the work force, team work and sound interpersonal relationships which is Esprit de corps. It is one of the 14 principles of management laid by Fayol. It is a French word that means Feelings of harmony and union among personnel . Union is strength is what this phrase directly implies. It emphasizes that all employees should cooperate and coordinate with each other, which is very essential for the organizations growth.

11. What are the various levels of Management?

Management is the process of designing and maintaining an environment in which individuals working together in groups effectively accomplish selected aims. The basic three levels of management are: Top level management (Features: Decision-making, Policy formulation, etc. Positions held: Board of Directors, Managing Director, CEOs, COOs, etc.) Middle level management (Features: Staffing, Directing, etc. Positions held: Finance manager, Marketing manager, Production manager, etc.) Low level management (Features: Implementing, Time scheduling, etc. Positions held: Supervisors, Foremen, etc.)

12. What are the roles played by a Manager? Role is defined as the pattern of behaviour which is defined for different positions. A manager in an organization has different tasks to be accomplished. His functions in an organization are not restricted to one area. He has different contexts of managing which are said to be different roles played by him. Managerial roles depend on the formal authority which is delegated to the manager in an organization. The following are his roles:INTERPERSONAL ROLES INFORMATIONAL ROLES DECISIONAL ROLES (i) Figurehead (i) Recipient (i) Entrepreneurial (ii) Leader (ii) Dissemination (ii) Disturbance handler (iii) Liaison (iii) Spokesperson (iii)Resource allocator (iv) Negotiator 13. What are the functions of management? Management is the art of securing maximum results with minimum effort so as to secure maximum prosperity and happiness for both employer and employee and give the public the best possible service. The functions of Management are: * Planning conscious determination of future course of action. 5

* Organizing process of dividing work into convenient tasks or duties. * Staffing manning of the various positions created by the organization. * Directing includes communicating, motivating and leading. * Controlling involves comparison of actual results with expected results as set by the planning process.

14. What is the classification of Business organizations? A Business organization comes into existence when there are a number of persons in communication and relationship to each other and are willing to contribute towards a common objective. The classification of Business Organizations is: * Sole proprietorship concern * Partnership concern * Joint Stock Companies - Private Limited Company - Public Limited Company * Co-operative societies * Public and Private Sector Companies.

15. Define Sole proprietorship. A Business unit that is owned and controlled by a single individual is known as a sole trading or sole proprietorship concern. He uses his own savings for running the business. The sole trader makes all purchases and sells on his own and maintains all the accounts. He alone enjoys all the profits and bears all the losses. Ex: A Fancy store.

16. What do you mean by a Partnership firm? A partnership is an association of two or more persons to carry on business and to share its profit and losses. The relation of a partnership arises from contract. The maximum 6

number of partners is limited to 10 in the case of banking business and 20 in the case of other business. Ex: Chand & Co.

17. What do you understand by the term Joint Stock Company? By a Company we mean an association of many persons who contribute money or moneys worth to a common stock and employs it in some trade or business and also shares the profit and loss as the case may be arising there from. There are two types of Joint stock companies:* Private Limited company Ex: M/s Key Media Pvt. Ltd. * Public Limited company Ex: M/s Pearl credits Ltd.

18. Who is (i) an active partner (ii) a sleeping partner? Active partner: Any partner who is authorized by others to manage the business is known as active partner. Sleeping partner: Any partner who does not express his intention to participate in the business can be called as a sleeping partner. He will be just an investor who has a right to share profits.

19. What is a Co-operative Enterprise? A Co-operative enterprise is a voluntary association of persons for mutual benefit and its aims are accomplished through self-help and collective effort. It may be described as a protective device used by the relatively less strong sections of society to safeguard their economic interests in the face of exploitation by producers and sellers working solely for maximizing profits. Ex: AAVIN Milk Federation Cooperative Society.

20. What is a Private limited company? 7

A Private limited company is a company which has a minimum paid up capital as may be prescribed. It can be incorporated with just two persons. It can have a maximum of 50 members. It cannot go in for a public issue. It restricts the transfer of its shares. It is particularly suitable for industrial ventures which can get many concessions in respect of income tax. Ex: M/s Key Media Pvt. Ltd.

21. What is a Public limited company? A Public limited company should have a minimum of 7 members and the maximum limit is unlimited. It can issue shares to the Public. The financial statement should be sent to all the members and to the Registrar of Companies. The shares of a public limited company can be transferred by the members to the others without any restriction by the company. Such transfers are made through organized markets called stock markets or stock exchanges. Ex: M/s Pearl credits Ltd.

22. What is a Public sector Enterprise? Public enterprise or State enterprise is an undertaking owned and controlled by the local or state or central government. They are financed and managed by the government. They are started with a service motive. Ex: NLC Ltd.

23. What is a Public Corporation? A Public corporation is an autonomous body corporate created by a special statute of a state or central government . A public corporation is a separate legal entity created for a specific purpose. Ex: LIC.

24. What is social responsibility? By Social Responsibility, we mean the intelligent and objective concern for the welfare of society that restrains individual and corporate behaviour from ultimately destructive activities, no matter how immediately profitable, and leads in the direction of positive contributions to human betterment, variously as the latter may be defined. 8

25. What are Values? Values are defined as global beliefs that guide actions and judgments across a variety of situations. Human values are the core of ethical or unethical behaviour. Values represent basic convictions that a specific mode of conduct is personally socially preferable to an opposite mode of conduct.

16 Marks

1. Trace the evolution of management with reference to the contributions made by management thinkers. Management is defined for conceptual, theoretical and analytical purposes as that process by which managers direct, maintain and operate purposive organizations through systematic, coordinated, cooperative human efforts. Management is a process involving planning, organizing, staffing, directing and controlling human efforts to achieve stated objective in an organization. Contributions of: Peter Drucker F.W. Taylor Elton Mayo Henri Fayol Max Weber Henry Gantt Frank & Lillian Gilbreth. These contributions came bit by bit and in haphazard manner and have failed to stimulate to study management as a distinct discipline. However their ideas created an awareness about managerial problems. 9

2. What is the role of scientific management in the modern era? Scientific management involves specific method of determination of facts through observation. The concept of scientific management was introduced by Frederick Winslow Taylor in the USA in the beginning of 20th century. It was further carried on by Frank and Lillian Gilbreth, Henry Gantt, etc. It was concerned essentially with improving the operational efficiency at the shop floor level. Scientific Management is concerned with knowing exactly what you want men to do and then see in that they do it best and cheapest way. Scientific management was introduced by F.W Taylor who is known as the Father of Scientific Management. He adopted scientific methods to increase the productivity and greater efficiency in production. The Features of Scientific Management are:Separation of planning and working Functional foremanship Job analyzers Time study or Work measurement Method study Motion study Fatigue study Standardization Scientific selection of training Financial incentives Economy and Mental revolution. Role of scientific management in the modern era Paved way for progress in productivity Employee-Employer relationship to be harmonious 10

Training & Development is the necessity of the hour Elimination of wastes through quality management is a control measure Optimal utilization of resources made possible. Scientific management is still considered the basic idea for paving the way of modern management approach.

3. Explain the contributions of F.W.Taylor to Management. Scientific Management is concerned with knowing exactly what you want men to do and then see in that they do it best and cheapest way. Scientific management was introduced by F.W Taylor who is known as the Father of Scientific Management. He adopted scientific methods to increase the productivity and greater efficiency in production. Principles of Scientific Management: Replacing Rule of thumb with science Harmony in group action Cooperation Maximum output and Development of workers. The Features of Scientific Management are:Separation of planning and working Functional foremanship Job analyzers Time study or Work measurement Method study Motion study Fatigue study Standardization 11

Scientific selection of training Financial incentives Economy and Mental revolution. Benefits of scientific management Taylors scientific management is more relevant to mechanization and automationtechnical aspect of efficiency- than the broader aspects of management of an organization. It created awareness about operational efficiency at the shop floor level than at the higher levels.

4. Explain the contributions of Henri Fayol. Management is simply the process of decision-making and control over the action of human beings for the expressed purpose of attaining pre-determined goals. Management is the art of getting things through and with people in formally organized groups. Administrative Theory of Management Usage of the term Administration; the Six activities of an industrial organization namely, technical, commercial, financial security, accounting and managerial. Fourteen general Principles of Management Division of work, Espirit de corps. Five Elements of management Planning, Organizing, Commanding, Coordinating, Controlling Six Managerial qualities Physical, Mental, Moral, Educational, Technical and Experience. Fayol made a clear distinction between management principles and management elements. These principles are flexible and capable of being adopted to every need. It is a matter of knowing how to use each of them which is a difficult art requiring intelligence, experience and proportion.

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5. Explain the contributions of Abraham Maslow and McGregor. Motivation is one of the most important factors affecting human behavior and performance. This is the reason why managers attach great importance to motivation in organization setting. Motivation represents an unsatisfied need which creates a state of tension or disequilibrium, causing the individual to move in a goal directed pattern towards restoring a state of equilibrium by satisfying the need.

THEORY X AND THEORY Y Douglas McGregor proposed two distinct views of human beings: on basically negative, labeled Theory X, and other basically positive, labeled Theory Y. After viewing the way in which mangers dealt with employees, McGregor conclude that a managers view of the nature of human being is based on a certain grouping of assumptions and that he or she tends to mold his or her behavior toward employees according to these assumptions. Under Theory X, the four assumptions held by mangers are: 1. Employees inherently dislike work and, whenever possible, will attempt to avoid it. 2. Since employees dislike work, they must be coerced, controlled or threatened with punishment to achieve goals. 3. Employees will avoid responsibilities and seek formal direction whenever possible. 4. Most workers place security above all other factors associated with work and will display little ambition. In contrast to these negative views about the nature of human beings, McGregor listed the focus positive assumptions that he called Theory y: 1. Employee can view work as being as natural as rest or play. 2. people will exercise self direction and self control if they are committed to the objective. 3. The average person can learn to accept, even seek, responsibility. 13

4. The ability to make innovative decisions is widely dispersed throughout the populations and is not necessarily the sole province of those in management positions. Theory X assumes that lower-order needs dominate individuals. Theory Y assumes the higher-order need dominate individuals. McGregor himself held to the belief that Theory Y assumptions were more valid than Theory X .Therefore; he proposed ideas such as participative decision making, responsible and challenging jobs and good group relations as approaches that would maximize an employees job motivation.

MASLOWS NEED HIERARCHY A.H Maslow, a famous social scientist, has given a frame work that helps to explain the strength of certain needs. According to him, there seems to be a hierarchy in to which human needs are arranged. 1. Physiological includes hunger, thirst, shelter, sex and other bodily needs. 2. Safety includes security and protection form physical and emotional harm. 3. Social includes affection, belongingness, acceptance, and friendship. 4. Esteem includes internal esteem factors such as self-respect, autonomy, and achievement: and external esteem factory such as status, recognition, and attention 5. Self- actualization the drive to become what one is capable of becoming; includes growth, achieving ones potential, and self-fulfillment.

6. Discuss the nature, purpose, merits and demerits of management in detail. Management is the process of designing and maintaining of an environment in which individuals working together in groups efficiently accomplish selected aims. Management is the art of getting things through and with people in formally organized groups. Nature Multidisciplinary Dynamic principles Relative not absolute principles 14

 Management science or art Management as profession and Universality of management Purpose Increase efficiency Crystallize the nature of management Train and develop managers Influence human behaviour Improve research Attain social objectives Merits Demerits Management is a process involving planning, organizing, staffing, directing and controlling human efforts to achieve stated objective in an organization.

7. Explain the importance of management in todays dynamic business world. Management is defined for conceptual, theoretical and analytical purposes as that process by which managers direct, maintain and operate purposive organizations through systematic, coordinated, cooperative human efforts. Management is a process involving planning, organizing, staffing, directing and controlling human efforts to achieve stated objective in an organization. Importance of management Key elements/functions in management Role of management in business application in functional areas of production, marketing, Human resources, Finance and Information system. 15

Management is a process involving planning, organizing, staffing, directing and controlling human efforts to achieve stated objective in an organization.

8. Differentiate between Management and Administration with suitable examples. Management is simply the process of decision-making and control over the action of human beings for the expressed purpose of attaining pre-determined goals. Management is a process of organized activities. It involves working with people and getting organizational objectives achieved through them. It tries to make effective utilization of various resources. Administration is that phase of a business enterprise that concerns itself with the overall determination of institutional objectives and the policies necessary to be followed in achieving these objectives. Administration plans and stabilizes the broad lines or principles which will govern action. Basis of differences between Management and Administration Level in organization Major focus Nature of functions Scope of functions Factors affecting decisions Employer-employee relation Qualities required Merits Demerits The basic point of controversy between management and administration lies in terms 16

of coverage of activities. Various views expressed in this regard have led to the emergence of three approaches namely- Administration is above management; Administration is a part of management and Management and Administration are same. Everyone performs all managerial functions, only relative importance of these functions varies.

9. Outline the various forms of Business organizations. Ownership of business is represented by the right of an individual or a group of individuals to acquire legal title to assets for the purpose of controlling them and to enjoy gains or profits from such possession and use. Definition of Business Definition of Business organization A Business organization comes into existence when there are a number of persons in communication and relationship to each other and are willing to contribute towards a common objective. Classification of business organizations The classification of Business Organizations is: * Sole proprietorship concern * Partnership concern * Joint Stock Companies - Private Limited Company - Public Limited Company * Co-operative societies * Public and Private Sector Companies. Features of each business organization Merits and Demerits Every business organization has its own advantages and disadvantages depending 17

upon its features. In choosing a particular form of organization, an entrepreneur will try to find out how far his requirements will be met by a particular form of organization.

10. Differentiate between a public and a private limited company. The increased needs of modern industry and commerce could not be met by sole proprietorships or partnerships. It was the joint stock type of organization which facilitated the full utilization of the technical and other innovations brought in by the industrial revolution. The Joint Stock Company is an artificial person created for carrying on some business by an association of persons. It is recognized by law, with a distinct name, a common seal, a common capital comprising transferable shares of fixed value carrying limited liability, and having a perpetual succession. Definition of Private and Public company Compare and contrast private and public company features The company form of organization is best suited to those lines of business activity which require huge capital outlay and maximum stability. This type of business organization dominates the world of industry, commerce and finance today.

11. Discuss the merits and demerits of various types of organization. Ownership of business is represented by the right of an individual or a group of individuals to acquire legal title to assets for the purpose of controlling them and to enjoy gains or profits from such possession and use. Definition of business Classification of business organization The classification of Business Organizations is: * Sole proprietorship concern 18

* Partnership concern * Joint Stock Companies - Private Limited Company - Public Limited Company * Co-operative societies * Public and Private Sector Companies Merits and demerits of all 5 types of business organizations Every business organization has its own advantages and disadvantages depending upon its features. In choosing a particular form of organization, an entrepreneur will try to find out how far his requirements will be met by a particular form of organization.

12. Explain Public sector and Private sector enterprises with reference to Indian Companies? Ownership of business is represented by the right of an individual or a group of individuals to acquire legal title to assets for the purpose of controlling them and to enjoy gains or profits from such possession and use. Definition of Business, Public sector and Private sector units Characteristics/features Advantages and disadvantages of Public and private sector companies Examples of Indian companies Public sector SAIL, NLC, NTPC, Indian Airlines, etc. Private sector Tata Steel, Mahindra&Mahindra, Reliance Industries, Jet Airways, etc. Every business organization has its own advantages and disadvantages depending upon its features. The public and private sector units are usually large scale industries which nurture the needs of people like power, aviation and so on. 19

13. Explain the recent developments in modern management theory. Management is defined for conceptual, theoretical and analytical purposes as that process by which managers direct, maintain and operate purposive organizations through systematic, coordinated, cooperative human efforts. Management is a process involving planning, organizing, staffing, directing and controlling human efforts to achieve stated objective in an organization. System theory of management Features of system theory Contingency / situational approach of management Critical evaluation Systems approach came in a big way in managerial analysis and raised the hope of becoming a general and unified theory of management. In contingency approach managers should not ignore the importance of taking actions according to the needs of the situations.

14. Discuss the contributions of Hawthorne experiments in the development of managerial thinking. ELTON MAYO and his associates greatly contributed to the human relations approach and MAYO is rightly called as The Father of Human Relations Movement. Elton Mayo conducted a few experiments to find out factors that could increase productivity. These experiments were called THE HAWTHORNE EXPERIMENTS. The following were the experiments: Illumination experiments Bank wiring experiments Relay assembly room experiments Mass interviewing experiments 20

CONTRIBUTIONS Human relations Approach Non economic awards Social man Organization as a social system

LIMITATIONS Criticized for lack of scientific and vigorous research Experiments were too narrow to warrant generalizations.

15. What are the various environmental factors that a manager should consider in an organization? Environment is a collectivity of all factors within the control of individual business and beyond the control of individual business. Environment includes all the conditions, circumstances, and influences surrounding the total organization or any of its part. The environment may be External and Internal

EXTERNAL ENVIRONMENT It greatly influences the working of every business. Its major components are: Economic- capital, labour, suppliers, consumers and customers Technological Social Political Ethical 21

INTERNAL ENVIRONMENT It is considered with the day to day work of the various departments of an organization. They may be Financial aspects HR policies and procedures Production activities Marketing and selling activities Information system The environmental forces may affect different parts of the organization in different ways because different parts interact with their relevant external environment differently. The impact of environmental forces on the organizations is not unilateral but the organizations may also affect the environment. So the organizations must either adjust to the environment or perish.

16. What are the challenges before Indian Managers? Every business has to cope up with the external environments prevailing at different times. This environment provides a set of outside challenges faced by the modern Indian managers.

INFORMATION TECHNOLOGY Revolution of IT (Computers, Internet, telecom,) Proper training of employees required Managers must be aware of the opportunities and threats posed to the organization by the updated technology revolution.

GLOBALISATION OF ECONOMY 22

 Communication revolution brought world closer Opening of Indian markets in MNCs Planning of business strategies keeping in view the world economy.

INTELLECTUAL CAPITAL Principal assets of modern organization lie in the minds of workers than machinery To capture and use the knowledge of workers that is an asset. NEWER ORGANOZATIONAL DESIGNS CHANGING JOB PROFILE CHANGING WORKFORCE PROFILE INCREASING ROLE OF WOMEN EMPLOYEES EMPHASIS ON KNOWLEDGE MANAGEMENT In order to face the challenges that have been posed or likely to be posed, managers have to change their practices which they have used to adopt in pre-liberalised era. 17. What do you mean by social responsibilities of Managers? A manager has to work not only for the betterment of the organization, but also work for the societys betterment. The society awakened and vocal by the urgency of social problems, is asking managers what they are doing to discharge their social responsibilities. The major components to be considered in the context of social responsibilities are given as follows: Social responsibility and social responsiveness Arguments against business involvement in social actions. Reaction and proaction Role of government 23

 Influence of values and performance criteria on behavior Social audit Thus considering the above mentioned factors a manager should maintain a balance between the organization s as well as societys welfare and growth.

18. Is Management a profession? Discuss. Profession has a dictionary meaning as Calling in which one professes to have acquired specialized knowledge, which is used either in instructing, guiding or advicing others. Profession is a vocation requiring some significant body of knowledge that is applied with high degree of consistency in service of some relevant segment of society. The following are the list of attributes of a profession and let us see if management satisfies these criteria. Body of specialized knowledge and techniques - YES Formalized methods of acquiring training and experience - YES Establishment of professional associations - NO Code of conduct - NO Priority of service over economy - YES Since some of the attributes of a profession is satisfied by a management and some are not we can say MANAGEMENT IS NOT YET A FULL FLEDGED PROFESSION.

19. Discuss the main characteristics of an effective manager. A manager should undertake a number of functions from planning to control. He has to take decisions for every type of activity. The decisions of manager of manager influence the working of an organization. The main qualities of an effective 24

manager are: Education Intelligence Leadership Training Technical knowledge Maturity Positive attitude Self confidence Foresight Thus we can conclude that business, since it is prone to risks, a manager is expected to possess Positive thinking without which progress in business becomes next to impossibility. 20. Discuss whether Management is an Art or Science. Management is the process of designing and maintaining an environment in which individuals working together in groups, effectively accomplish selected aims. MANAGEMENT AS AN ART Management is the art of getting things done from people. It has the following features that makes it an art. An art is often regarded as the systematic application of skill or knowledge in effective accomplishment of results. The following features makes management an art: Creative Individual approach Application and dedication Initiative 25

 Intelligence A science is a systematized body of knowledge acquired by mankind through. observation and experimentation. Management also involves a systematic approach towards designing and maintaining an environment in which individuals work together in groups to effectively accomplish selected aims. The following features makes management a science: Systematic decision making Universal management process Situational output Universally accepted management. As management fulfills both the features of art and science it can be called both as an art and science.

21. Who are the different partners in partnership concerns? Discuss features, merits and demerits. A partnership concern is an association of 2 or more persons to carry on business and to share its profits and losses. In sole proprietorship financial resources and management skills are limited. One man cannot supervise personally all the business activities.

TYPES OF PARTNERS Active Partner Stepping Partner Normal Partner Partner in profit only Partner by stopper 26

 Sub-Partner Secret Partner Minor as Partner.

FEATURES OF PARTNERSHIP Agreement Multiplicity of person Unlimited liability Registration Common management Utmost good faith Lawful business Sharing of profit Contractual relations Mutual agency.

ADVANTAGES OF PARTNERSHIP Easy to form Registration not compulsory Larger financial resources Greater management talent Prompters in decision making Risk of business shared by more persons More possibility of growth and expansion of business There can be any change in managerial setup capital and scale of operations 27

 Easy dissolution.

LIMITATIONS OF PARTNERSHIP Unlimited liability increases dissolution of firm Lack of harmony among partners Lack of public faith Limited resources Limitation of transfer of share.

22. Give the overall view of functional areas of management. Management is the process of designing and maintaining an environment in which individuals working together in groups, effectively accomplish selected aims. Management is required to achieve business objectives. In order to reach various goals managerial activities are divided into various functions. The main operating units of an undertaking are generally purchase, sales and storage. So management process will require undertaking of certain functions. The eight functional areas of management are: Production management Development management Material management Personnel management Financial management Marketing management Purchasing management Office management.

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23. Discuss Bureaucratic theory in detail. MAX WEBER, a German sociologist who was a teacher at Berlin University was a chief exponent of bureaucratic model. It was a rational approach wherein specific objectives of organization are laid down are organization is designed to achieve them and it is legal because authority stemmed from a clear defined set of rules, procedures and functions.

Features A clear separation between superior and subordinate Division of labour based on competence and functional specialization Clear divorce between personnel and official matters System of rules, regulations, procedures There is hierarchy in positions based on legal authority and power. Merits Demerits Bureaucratic structure can work well when the environment is highly static and predictable. In dynamic environment, more interaction between organization and environment is required. There is high need for information monitoring and processing.

24. Discuss Quantitative/Mathematical or Operations theory in detail. Management is the process of designing and maintaining an environment in which individuals working together in groups, effectively accomplish selected 29

aims. Many theories were put forward to understand what management is, what management theory is and how managerial events should be analyzed. We are going to discuss 2 theories out of it, the mathematical approach and the operation theory.

MATHEMATICAL APPROACH This is one of the approaches of management. This theory lays emphasis on logical thinking and rational decision-making. Thus this theory gives tools for rational decision-making and also formulae. Features Mathematical processes, concepts, symbols and models Makes management purely a logical process Expressed as mathematical symbols and relations. Limitations Preoccupation with mathematical models Many aspects in management cannot be modeled It is hardly a school to management. OPERATIONAL APPROACH It is one of the approaches in management that emphasizes adoption of techniques and knowledge from other fields and approaches. Features Draws together concepts, principles, techniques and knowledge from other fields and managerial approaches Distinguishes managerial and non-managerial knowledge. Develops classification system built around the managerial functions. 30

Limitations Does not identify representing or coordination as a separate function. The mathematical and operational approaches paved way for better analysis of situations by building models. These approaches helped managers in decisionmaking processes. 25. Explain systems approach and contingency approach in detail. Management is the process of designing and maintaining an environment in which individuals working together in groups, effectively accomplish selected aims. Many theories were put forward to understand what management is, what management theory is and how managerial events should be analyzed. Let us discuss the systems approach and contingency approach out of it. SYSTEMS APPROACH A system view point may provide the important criteria to unify management Theory. It treats various approaches such as process, quantitative and behavioral all as one theory of management. Features Broad applicability Inspite of boundaries they interact with external environment Recognizes importance of studying interrelations of planning, organizing, controlling. Limitations It can hardly be considered as a new approach in management. CONTINGENCY APPROACH It is also called as the situational approach. It is based on basic premises that there is no one best way to handle any management problem. Features 31

 Managerial practice depends on circumstances. Recognizes influence of given solutions on organizational behaviour patterns. Limitations Difficulty in determining all relevant contingency factors and showing their relations Very complex. Systems approach came in a big way in managerial analysis and raised the hope of becoming a general and unified theory of management. In contingency approach managers should not ignore the importance of taking actions according to the needs of the situations. UNIT I - PLANNING 2 Marks 1. Planning Planning involves selecting missions and the objectives and the actions to achieve them. It ends with decision making, which is choosing the best alternative from the avail-able future courses of action. (OR) Planning is deciding in advance what to do, how to do, when to do and who is to do it. It is the selection among alternates of future course of action for enterprise as a whole and each department within it. Plans involve selecting enterprise objectives and determining ways of achieving them. EG: The goal set for limited period like five year plans

2. TYPES OF PLANNING: Some types of planning are: Corporate and functional planning. Strategic and tactical planning. Long term and short term planning. Proactive and reactive planning. 32

Formal and informal planning.

3. MISSION: A mission statement helps the organization to link its activities to the needs of the society in which it operates. In short mission is a basic fundamental principles for which the organization is created. EG: Canara Bank Good People To Grow With VISION: A vision statement indicates how the organization should be, after a particular time period

4. MBO: Management by objectives is defined as a comprehensive managerial system that integrates many key managerial activities in a systematic manner and that is consciously directed towards the effective and efficient achievement of organizational and individual objective. (OR) MBO is a process whereby the superiors and the subordinate managers of an en-terprise jointly identify its common goals, define each individual major areas of responsi-bility in terms of results expected of him, and use these measures as guides for operating the unit and assessing the contribution of each of its members. - GEORGE ODIORNE

5. POLICIES: Policy is a statement which provides guidance in decision making to members of an organization in respect to any course of action. Policies are the guidelines to achieve goals. - L.M.PRASAD (OR) Policies are general statements of understandings which guide or channel think-ing in decision making or subordinates. - KOONTZ and WEIHRICH 33

6. TYPES OF PLANS: Some types of plans are: Multi use plans Objectives Strategies Policies Procedures Rules Single use plans Programmes Budgets Schedules Projects Methods

7. STRATEGY: Strategy is the determination of basic long term objectives and the adoption of course of action and allocation of resources to achieve these goals-Alfred D Chandler. Three definitions are indicative of more common use of strategy: General programs of action and deployment of resources to attain comprehensive objective. The programs of objectives of an organization and their changes, resources used to attain these objectives and policies governing the acquisition, use and disposition of these resources. The determination of basic long term objectives of an enterprise and the adoption of course of action and allocation of resources to achieve these goals. EG: Team goal 34

8. FEATURES OF POLICIES: Policy is a statement which provides guidance in decision making to members of an organization in respect to any course of action. Policies are the guidelines to achieve goals. - L.M.PRASAD

UNIT III - ORGANIZING 2 Marks 1. Define Organization. An identified group of people contributing their efforts towards the attainment of goals is called an organization. Organisation is the process of establishing relationships among the members of the enterprise. ORGANISATION may be defined as the process of i) Identifying and grouping the work to be performed ii) Defining and delegating responsibility and authority iii) Establishing relationships for the purpose of enabling people to work most effectively together in accomplishing objectives. 2. What is the purpose of Organization? 35

Organizing activities are very important for the success of an enterprise. Organization is the foundation store upon which the whole structure of management is built. It is the backbone of management. A sound organization can contribute to the success of an organization by serving the following purposes Facilitates Administration Increases the efficiency management Stimulates creativity and innovation Facilitates growth and diversification and Facilitates co-ordination and communication. 3. What is Organizing? Organizing is the act of rearranging elements following one or more rules. It is the process of defining and grouping the activities of the enterprise and establishing the authority relationships among them. Organizing is defined as the management function of assigning duties, grouping tasks, formal reporting relationships and ensuring effective coordination within the organization. 4. What is Specialization? Specialization is the process in which a person is specialized in a particular subject, in a profession, art, course or in a work, they are said to be more known in a particular subject. Specialization means the process of dividing the work. Specialization permits individuals to develop expertise in their assigned tasks and their own and groups effectiveness. Specialization refers to the degree to which the overall organizations activity is broken down into smaller components. 5. What is Job design? Job design is usually broad enough to accommodate peoples needs and desires. It may be especially appropriate to design jobs for exceptional persons in order to utilize their potential. People spend a great deal of time on the job and it is therefore important to design jobs so that individuals feel good about their work. Two important goals of job design are: To meet the organizational requirements such as higher productivity, operational efficiency, quality of products/service etc. To satisfy the needs of the individual employees like interests, challenge, achievement etc. 6. What are the benefits of Specialization? Specialization refers to the degree to which the overall organizations activity is broken down into smaller components. The benefits of specialization are as follows:36

 Good quality of products Less consumption of work time Less but effective utilization of resource and Organizational growth. 7. What are the limitations of Specialization? Specialization permits individuals to develop expertise in their assigned tasks and their own and groups effectiveness. The limitations of specialization are as follows:(a) Workers who must perform highly specialized tasks over and over again become bored and dissatisfied with the work; (b) Specialized tasks seldom offer the worker any real challenge and few opportunities to learn and grow; (c) Worker becomes bored with the work, monotony, absenteeism, tardiness increases and the quality of work decreases; and (d) The workers dissatisfaction has a strong negative impact on overall organizational morale and effectiveness. 8. What is Job rotation? Job rotation is an important method for broadcasting the outlook of managers and potential managers. They are transferred from one job to another and from one department to another in a systematic way . This method provides a great deal of job experience for potential executives who need the broadening of their outlook and an increased understanding of managerial aspects. The idea in this method is to import an overall knowledge and familiarity with different jobs. 9. What is Job enlargement? Job enlargement refers to enlarging the range of tasks in a job to make it more broadbased. It is the strategy adopted by many managers to combat the maleffects such as division of labour, assembly line and job simplification which has made the jobs dull and monotonous. It attempts to make a job more valid by removing the dullness associated with performing repetitive operations. As a result there was variety and challenge in the job. Workers will get job satisfaction and there is also improvement in their performance. 10. What is Job enrichment? Job enrichment is a non-financial motivational technique which emphasizes the need for challenging and interesting work. It implies increasing the contents of the job or the deliberate upgrading of responsibility, scope and challenge in work. It is therefore based on the assumption that in order to motivate personnel, the job itself must provide opportunities for achievement, recognition, responsibility, advancement and growth. The 37

job is designed in such a manner that it becomes more interesting and challenging to the job holder. 11. What is Departmentation? Departmentation means the process of grouping of similar activities of the business into department, division or other homogenous unit. It is used for the purpose of facilitating smooth administration at all levels. This facilitates communication, coordination and control, thus contributing to organizational success. It creates semiautonomous units with independent responsibilities, providing satisfaction to the manager which in turn improves efficiency and effectiveness. 12. What is Functional Departmentation? Grouping activities in accordance with the functions of an enterprise called functional departmentation embodies what enterprises typically do. Since all enterprise functions are production, selling and financing, it has been logical to group these activities into such departments as engineering, production, sales or marketing and finance. 13. What are the advantages of Functional Departmentation? Functional departmentation involves the grouping of people on the basis of their overall function such as manufacturing, finance, production and human resources. The advantages of Functional departmentation are: Most logical, time proven and natural form of departmentation Provides specialization which makes optimum utilization of man power Ensures the performance of all activities necessary for achieving organizational objectives Facilitates delegation of authority Permits effective control over performance Eliminates costly duplication of effort and Makes management easier because managers have to be experts only in a narrow range of skills. 14. What are the demerits of Functional Departmentation? Functional departmentation involves the grouping of people on the basis of their overall function such as manufacturing, finance, production and human resources. The disadvantages of functional departmentation are given below: Provides poor communication across functional departments 38

 Slow response times to external changes Decisions to be concentrated at the top management resulting in delays and Creates an atmosphere in which it is difficult to pinpoint responsibility for problems. 15. What are the components of Divisional Departmentation? Departmentation means the process of grouping of similar activities of the business into department, division or other homogeneous units. It is used for the purpose of facilitating smooth administration at all levels. The various components of divisional departmentation are:-

Departmentation by Functions Departmentation by Products Departmentation by Territory Departmentation by Customers Departmentation by Process or Equipments and Departmentation by Time and Numbers. 16. What is Product Departmentation? Product departmentalization is defined as creating a division or department for each product or product line. Every major product is organized as a separate department. It is generally employed when the product is relatively complex and a great deal of capital is required for plant and equipment. For ex: A big company with diversified product line may have three product divisionsone for plastic, chemicals and metals. Each division is subdivided into production, sales, finance and personnel activities. 17. What is Recruitment and Selection? Recruitment: Recruitment is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. The result is a pool of applicants from which new employees are selected. Selection: Selection is the process of differentiating between applicants in order to identify those with a greater likelihood of success in a job. It is the process of making choice of individuals possessing the required qualifications and skills necessary to perform the job successfully. 39

18. What is Aptitude test? Aptitude test is used for measuring human performance characteristics related to the possible development of proficiency on specific jobs. It measures the latent or potential characteristics to do something provided proper environment and training are added to individuals. Aptitude test is designed to examine whether a candidate is likely to be able to acquire the skills and knowledge necessary to perform the job. It is used to measure the job proficiency and job training of an employee. 19. What is Intelligent test? Intelligent tests are the tests that measure a candidates existing intelligence . It is related to job concern such as wiring, assembling, artistic etc. This includes verbal comprehension, word fluency, memory, reasoning, speed of perception, etc. IQ (Intelligent Quotient) is calculated as follows: mental age IQ = -------------- * 100. actual age 20. What is Personality test? Personality test is administered to predict performance success for jobs that require dealing with people, or jobs that are essentially supervisory or managerial in character. It is a projective test as it projects the personality of an individual who may be employed by the organization. Personality tests are a type of psychological questionnaire designed to measure the more permanent emotional tendencies people have, that make up their personality. Ex: Thematic Apperception Test (TAT) 21. What is On-the-job training? On-the-job describes training that is given in a normal working situation, using the actual tools, equipment, documents or materials that they will use when fully trained. On-the-job training (OJT) is one of the best training methods because it is planned, organized, and conducted at the employee\'s worksite. OJT will generally be the primary method used for broadening employee skills and increasing productivity. It is particularly appropriate for developing proficiency skills unique to an employee\'s jobespecially jobs that are relatively easy to learn and require locally-owned equipment and facilities. Ex: Coaching. 22. What is Off-the-job training? Off-the-job training takes place away from normal work situation which means that the employee is not regarded as productive worker when training is taking place. An advantage of off-the-job training is that it allows people to get away from work and 40

totally concentrate on the training being given. This is most effective for training concepts and ideas. Ex: Seminars and lectures. 23. What is Matrix Organisation? Matrix structure is a hybrid organizational form, containing characteristics of both project and functional structures. It is two dimensional pattern developed to meet the problems of growing size and complexity of undertakings. Matrix organization is any organization that employs multiple command structure but also related support mechanism and an associated organizational culture and behavioural pattern. It is defined as any organization that employs a multiple command system that includes not only the multiple command structure but also related support mechanism and an associated organizational culture and behaviour pattern. 24. What is an Organizational chart? According to George Terry, Organizational chart is a diagrammatical form, which shows the important aspects of an organization including the major functions and their respective relationships, the channels of supervision, and the relative authority of each employee who is in charge of each respective function. It is a representation of the framework or structure of an organization. It may be a vertical or top-down chart, horizontal or left to right chart and circle or concentric chart. 25. What is Span of Control? Span of Control or Span of Management means the number of people effectively managed by a single superior in an organization. It is also known as Span of Supervision, Span of Authority and Span of Responsibility. It is very difficult to decide the appropriate span of control. It is related to the degree of responsibility exercised by the group members. It refers to the number of subordinates that report directly to a single manager or superior. 26. What is Line authority? Line authority, the basic authority in an organization, is the ultimate authority to command, act, decide, approve or disapprove- directly or indirectly-all the activities of the organization. It is the authority to direct the work of others and to require them to conform to decisions, plans, policies, systems, procedures and goals. Line authority exists between superior and his subordinate. In the organizing process, activities are assigned to the individuals making them responsible for the proper performance of these activities. Line officials are in the chain of command from the highest executive to the lowest position in the organization. 28. What is Staff authority? 41

Staff authority refers to those elements which have responsibility and authority for providing advice and services to line in attainment of objective. It is best defined as authority whose scope is limited, by the absence of the right to direct or command, to such auxiliary and facilitating activities as planning, recommending, advising or assisting. The nature of staff authority is advisory. Staff managers cannot issue orders. They can provide better solutions to organizational problems in their areas. Staff may be divided into- personal staff, specialized staff and general staff. 29. What is Functional authority? Functional authority occupies a midway position between line and staff authority. It is a means of putting the staff specialists in top positions for the entire enterprise and it confers upon the holders a limited power to command over the people of different departments concerning their function. It remains confined to functional guidance of different departments. Functional authority differs from line authority in that its right to command is limited to a particular specialized area. It differs from staff authority in that functional authority confers upon its holders the right to command in matters pertaining to that function. 27. What is a Committee organization? A committee is a group of persons formed to discuss and deliberate on problems and to recommend or decide solutions . Its area of operation is determined by its constitution. Its scope of activities is limited. This authority is expressed in terms of one member one vote. It is a group of six people- two to do the work, three to pat those two on the back, and one to present a minority report. A committee usually represents a modification in the existing line, line and staff and functional organization structures. It is an aid to the existing organization, rather than an essential part of it. According to the nature of their constitution and functions, committees are classified as: Line and Staff committees Formal and Informal committees Standing and Adhoc committees Executive committee and Coordinating committee. 28. What is a Project organization? Project Organization is oriented towards the completion of a big project or small number of big projects of long duration. It is usually structured to facilitate planning and designing of the product, completion of the assigned task and phasing out of the project. Each project is organized as a semi-autonomous project division. The activities 42

of project team members are coordinated by a project manager who is ultimately responsible for success of project. The need for project organization is felt when an organization is to execute a project or programme which is subject to high standards of performance as in case of aircraft companies. 16 Marks 1. Explain the concept of Functional authority. Functional authority occupies a midway position between line and staff authority . It is a means of putting the staff specialists in top positions for the entire enterprise and it confers upon the holders a limited power to command over the people of different departments concerning their function. It remains confined to functional guidance of different departments. Functional authority differs from line authority in that its right to command is limited to a particular specialized area. It differs from staff authority in that functional authority confers upon its holders the right to command in matters pertaining to that function. Definition, nature and purpose of authority Nature of Functional authority Benefits and limitations of functional authority Benefits Specialists give expert advice to workers Relives line executives of routine Reduces number of accidents and wastages Duties by an individual are performed in a better manner. Limitations Danger of undermining authority Lack of staff responsibility Thinking in vacuum Managerial problems Delegation of authority 43

 Importance of authority.

2. Discuss Delegation of Authority. Authority is the right to give orders and the power to exact obedience. It is the power to command order to act or not to act in a manner deemed by the possessor to further enterprise or departmental purposes. Features of authority How authority is delegated Process of delegation Splintered authority Principles of delegation Personal attitudes towards delegation Respectiveness Willingness to let go Willingness to let others make mistakes Willingness to trust subordinates and Willingness to establish and use board controls. Guide for overcoming weak delegation Assignments and delegate authority in light Select the person in light of the job to be done Maintain open lines of communication Establish proper controls and Reward effective delegation and successful assumption of authority.

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3. Explain the (i) concept of decentralization (ii) factors determining the degree of decentralization of authority. Decentralization refers to the systematic effort to delegate to the lowest levels all authority except that which can only be exercised at central points. It means dispersal of decision-making power to the lower levels of the organization. Factors that cause decentralization of authority Need is realized to take quick and appropriate decisions on the spot at any level Top management wants to reduce communication work Technological changes Growth and diversification of activities of the company Provide special emphasis on a product line or a market and Physical dispersion of activities of the company. Degree of Decentralization of authority Number of decisions made lower down the management hierarchy is greater More important decisions are made at the lower level More functions are affected by decisions made at lower levels and Less checking on the decisions made at the lower level. Advantages of decentralization Limitations of decentralization. Achieving effective decentralization.

4. Explain staffing in detail. Staffing is concerned with manning various positions in the organization . It involves the determination of manpower requirements of the enterprise and providing it with adequate competent people at all levels. The staffing function of management pertains to recruitment, selection, training, development, appraisal and remuneration of personnel. It is the tendency in modern organizations to create a separate HR department to perform the staffing function. 45

 Nature and Role of staffing Factors affecting staffing External factors Internal factors Functions of Human Resource Management Significance and Process of Manpower planning Importance of Staffing function. 5. Discuss the different sources of Recruitment. Recruitment is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. The result is a pool of applicants from which new employees are selected. Internal sources Transfer Promotion External sources Advertisement Recommendations Hate applicants Employment Exchange Personal consultants Educational Institutions Waiting List Unsolicited applications Jobbers and Contractors Field topics Leasing 46

 Importance of Recruitment. 6. Explain in detail the Selection process. Selection is the process of differentiating between applicants in order to identify those with a greater likelihood of success in a job. It is the process of making choice of individuals possessing the required qualifications and skills necessary to perform the job successfully. The process of selection leads to employment of persons having the ability and qualifications to perform the jobs which have fallen vacant in an organization. Curriculum vitae and application form Personal information Educational information Extra curricular activities Work experience and training Short listing Testing Ability test Aptitude test Performance test Personality test Interviewing Obtaining references Medical Examination Final selection Letter of Offer Induction and orientation. 7. What is performance appraisal? Performance Appraisal is a formal, structured system of measuring and evaluating an employees job related behaviours and outcomes to discover how & why the employee 47

is presently performing on the job and how the employee can perform more effectively in the future so that the employee, organization & society can benefit. Introduction Meaning Objectives Problems in performance appraisal Faulty assumptions Psychological Barriers Halo effect Personal Prejudice Subjectivity Essentials of effective appraisal Criteria for measurement of performance Methods of performance appraisal Trait-based appraisal Graphic scale method Ranking method Grading Forced distribution method Checklist method Critical incident method Group appraisal Appraisal by results Management By Objectives (MBO) Behaviourally Anchored Rating Scales (BARS) 48

Assessment centers Appraising managers as managers 8. Discuss the importance of training and the methods of training. Training is the act of increasing the knowledge and skills of an employee for doing a particular job. Training should mould the attitude of a worker towards other coworkers, supervisor and the organization UNIT IV - DIRECTING 2 Marks 1. Define Direction. Direction may be defined as the process of instructing, guiding and inspiring human factors in the organization to achieve organization objectives.

2. State two important characteristics of Directing. Any two characteristics of Directing are: Directing is an important managerial function through which the management initiates actions in the organisation. It is a continuous process and it continues throughout the life of the Organization. 3. List out the human factors in managing. The Human factors in managing include: Multiplicity of roles Individuality and Personal dignity. 4. Define creativity. Creativity is defined as the ability to produce new and useful ideas through the combination of known principles and components in novel and non obvious ways. Creativity exists throughout the population largely independent of age, sex and education. 5. What are the steps involved in creative process?

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Creativity is defined as the ability to produce new and useful ideas through the combination of known principles and components in novel and non-obvious ways. The steps involved in creative process are: Saturation Preparation Frustration and incubation Inspiration or illumination Verification 6. How are problems solved by creative tool? Creativity tools are designed to help you devise creative and imaginative solutions to problems. Creativity tools are designed to help you devise creative and imaginative solutions to problems. 7. What is a SCAMPER tool? SCAMPER is a checklist that helps us to think of changes where S - Substitute C - Combine A - Adapt M - Modify P - Put to another use E - Eliminate and R - Reverse. 8. What is a meant by reframing matrix? Reframing matrix is a simple technique that helps to look at business problems from a number of different viewpoints. The approach relies on the fact that different people with different experience approach problems in different experience approach in different ways. 9. What are the steps involved in simplex tool? Simplex tool is an industrial-strength creativity tool. The steps involved in simplex tool are:50

 Problem finding Fact finding Problem definition Idea finding Selection and evaluation Planning Sell data and Action. 10. Differentiate Innovation and Invention. Innovation means the use of creative ideas. It is not only relevant to high-tech enterprises but also crucial for old-line, traditional companies, which may not service without the infusion of innovation. Ex: A new product or a service. Invention means really finding new things that are not already available. It is mostly applicable in the field of science. Ex: Invention of radio. 11. How can be harmonizing objectives achieved? Harmonizing objectives can be achieved through: Mutual trust Cooperation and understanding and Workers participation in management. 12. Define Multiplicity of Roles. Individuals are not only the productive factor in management Plans. They are members of social system of many organizations. 13. Creativity refers to the _____________________________ It is the ability and power to develop to develop new ideas.

14. Define Motivation. 51

Proper utilization of human resource possible since it inspires employees to make best possible use of different factors of production. Motivation means a process of stimulating people in action to accomplish desired goals.

15. Name the steps involved in motivation process. Motivation is a behavioural concept that directs human behaviour towards certain goals. The steps involved in the motivation process include, Analysis of situation Preparing, Selecting and applying a set motivating tools. Follow-up. 16. What are the types of motivation? Motivation is a complex process which is created because of the nature of needs and the type of behaviour that is attempted to satisfy those needs. The types of motivation are: Positive motivation Negative motivation Extrinsic motivation and Intrinsic motivation. 17. What are the different Motivational theories? The different motivational theories include: Mc Gregors Theory X and Theory Y. Maslows need hierarchy theory Herzberg theory of motivation. 18. List out the basic needs in hierarchy. The basic needs in hierarchy include: Physiological needs Safety needs Social needs Self-Esteem needs and 52

 Self-actualization needs 19. Who is a leader? Leader is one who makes his subordinates to do willingly what he wants. The efforts of subordinates are to be channelised in the right direction by him. 20. Define Leadership. Leadership is the process of influencing the behaviour of others towards the accomplishment of goals in givens situations. Leadership is the art of process of influencing people so that they will strive willingly towards the achievement of group goals. 21. List the few leadership theories? Few leadership theories include: The Michigan studies The Ohio state university studies and The Managerial grid. 22. State House-path goal approach. Leaders are effective because of the influence on followers motivation ability to perform and their satisfaction. This path goal is employed because the leader setup clear guidance through which the subordinates can achieve goals. 23. Name the various leadership styles. The various leadership styles include: Autocratic leadership Democratic leadership and Laissez-faire leadership. 24. What is Laissez faire? Complete freedom is given to the subordinate so that they plan motivate control and otherwise be responsible for their own actions. 25. What is communication? Communication is the transmission of information from one person to another person. Ex: Business communication. 53

26. Mention the various elements in the process of communication? The various elements in a communication process: Sender Communication channels Symbols Receiver Noise and feed back. 27. Name the various types of communication. The various types of communication are: Downward and Upward communication Formal and Informal communication Horizontal and Vertical communication.

16 Marks 1. Explain the creative process? Creativity: Creativity is the ability to create large number of ideas quickly. Creative process has interacting and over lapping phase. It has four phases: Unconscious Scanning Intuition Insight Logical Formulation Unconscious Scanning: A condition beyond consciousness. Intuition: It connects unconscious with conscious Insight: It is the result of hard work Logical Formulation: referred to as verification Techniques to enhance creativity: 54

The following are the techniques to enhance Creativity: 1. Brainstorming Technique used for problem solving by using new methods 2. Synectics In this technique group members are selected according to problem of organization. Then a group leader s chosen who plays a vital role in this process. 2. Explain the importance of leadership? The word leadership implies responsibility, authority and status but power and decision making provide the foundations for leadership. Four skills needed for Leadership Leaders Skills. Technical Skills. Interpersonal Skills. Conceptual Skills. Theories of leadership Trait Approach. Behavioral Theory. Laissez-Faire Leadership. 3. Explain the motivation process? 4. Explain the Maslows need hierarchy theory? Motivation is the process of initiating and directing behavior defined by Victor Vroom.

Edwin B. Flippo defined motivation as process of attempting to influence others to do your will through possibility of gain or reward.

One of the most popular theories of motivation is the hierarchy of needs theory, developed by an American Psychologist Abraham Maslow and popularized as Maslows need hierarchy theory.

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Maslow defined basic human needs as, 1. Physiological needs. 2. Safety Needs/ Security Needs. 3. Social Needs. 4. Esteem Needs. 5. Self-Actualization needs. In the hierarchy first two needs i.e. physiological needs and safety needs are called, as lower level needs. These needs are finite. The next three needs i.e. social needs, esteem needs and self actualization needs are higher level needs. The higher level needs are infinite. 5. Explain the special motivational techniques? Motivation is the process of initiating and directing behavior defined by Victor Vroom. Edwin B. Flippo defined motivation as process of attempting to influence others to do your will through possibility of gain or reward. Reinforcement theory is the special motivational technique adopted that examines the effects those consequences have on motivation and behavior. The two principal approaches that can be used to increase the probability of behavior desired by the manager or the organization are as follows, 1) Positive Reinforcement are desirable consequences often referred to as rewards, being given or applied, increase the likelihood of behavior being repeated in the future. For positive reinforcement to be effective in motivating behavior in organizational settings, they should have the following attributes. (a) Equitable (b) Efficient (c) Available (d) Not Exclusive (e) Visible (f) Reversible 2) Negative Reinforcement removal of undesirable consequences, that is, consequences that a person performing an act does not want, can increase the likelihood 56

of that behavior being repeated in the future. The removal of such undesirable consequences is called a negative Reinforcement. For negative reinforcement to be effective, they should have the following attributes. (a) Punishments (b) Extinctions 6. Explain the communication process? Communication is the exchange of messages between people for the purpose of achieving common meanings. Although communication applies to all phases of managing, it is particularly important in the leading function. The basic communication process consists of the following components (i) Sender. (ii) Transmission of message (medium). (iii) Receiver. (iv) Feedback. (v) Noise. Sender: The sender is the initiator of the message. Message are usually initiated by thought or in response to outside stimulus. Transmission Medium: The message is transmitted over a medium/ channel that links the sender with the receiver. Receiver: The receiver is the person with whom the message is exchanged. Noise: In communication process noise is the factor that interferes with exchanging messages which hampers achieving common meaning. Feedback: It provides preliminary information to the sender about the success of the communication process. 7. Explain the barriers to effective communication and suggest measures for improvement. Communication is the exchange of messages between people for the purpose of achieving common meanings. Communication breakdown is one of the major problems in communication process. Improper communication spoils the teamwork or co-ordination in an organization. Various causes of barriers in communication are 57

1. Lack of Planning 2. Unclarified Assumptions 3. Semantic distortion 4. Poorly expressed messages 5. Loss by transmission 6. Poor listening 7. Impersonal communication Effective Communication: For effective communication in an organization several approaches can be used such as Communication Audit Communication techniques. 8. What is communication? Explain the principles of effective communication. Communication is the exchange of messages between people for the purpose of achieving common meanings. Although communication applies to all phases of managing, it is particularly important in the leading function.

Principles of effective communication: Effective communication calls for coordinated efforts. It is necessary to understand the essentials of good communication and work towards achieving them. They are : Be clear about the purpose Understand the process of communication Be clear about the target audience Develop good communication skills Be well informed Plan your communication Be positive in approach Be sincere, dont manipulate 58

Be consistent Appreciate the time factor Use proper modes and channels Be cost conscious Obtain feedback 9. Explain the different styles of leadership. The word leadership implies responsibility, authority and status but power and decision making provide the foundations for leadership. A leader has to lead different styles or types of subordinates and has to adopt different styles for leading them according to situations. The behavioral theory includes the following main types of leadership styles. 1) Autocratic or authoritarian leadership style. 2) Democratic or participative leadership style. 3) Laissez faire or free rein leadership style. 10. What are the four basic ingredients of leadership skill? The word leadership implies responsibility, authority and status but power and decision making provide the foundations for leadership. Four skills needed for Leadership Leaders Skills. Technical Skills. Interpersonal Skills. Conceptual Skills. 11. Explain the various communicating networks? Communication is the exchange of messages between people for the purpose of achieving common meanings. In any organization communication is the movement of information throughout various parts of company. The relevant information and fast flow of information is the need of organizational communication. There exist two major directions of communication flow in effective organization. They are, 59

a) Vertical communication b) Horizontal communication Vertical Communication: The communication that involves a message exchange between two or more levels of the organizational hierarchy is called as vertical communication. There are two categories of vertical communication (i) Downward communication (ii) Upward Communication Horizontal/ Lateral Communication: It is the lateral message exchange either within work-unit boundaries, peers who report to the same supervisor or across work-unit boundaries involving who report to different supervisors. Horizontal communication is also called as Crosswise Communication. Horizontal Communication is related to 1) Task co-ordination / understanding 2) Problem Solution / Conflict Resolution 3) Information Sharing. 12. Explain the barriers involved in effective communication? Communication is the exchange of messages between people for the purpose of achieving common meanings. The following are the barriers in communication process, 1. Organization structure 2. Lack of planning 3. Status 4. Unclarified assumptions 5. Language misinterpretation 6. Poorly expressed message 7. Faulty Listening 8. Communication Gap For example 60

a) Sense of Achievement. b) Sense of Responsibility. c) Sense of work itself. d) Sense of Recognition. e) Advancement Opportunity. f) Personal growth. 13. Explain the Porter and Lawler expectancy theory? Motivation represents an unsatisfied need which creates a state of tension or disequilibrium, causing the individual to move in a goal directed pattern towards restoring a state of equilibrium by satisfying the need. Motivation is a process that starts with a physiological or psychological deficiency or need that activates behaviour or a drive that is aimed at a goal or incentive. Porter and Lawler have derived a substantially more complete model of motivation. They propose a multi- variant model to explain the complex relationship that exists between job attitudes and job performance. Their model encounters some of the simplistic traditional assumption made about the posit e relationship between satisfaction and performance. Effort - Effort refers to the amount of energy exerted by an employee on a given task. Perceived reward probability refers to the individuals perception of the probability that differential rewards depend up on differential amounts of effort. These two factors- value of reward and perception of effort- reward probability determine the amount of effort that the employee will put in. Performance - Effort leads to performance but both or these may not be equal; rather, performance is determined by the amount of effort and the ability and role of perception of the individual. Thus, if an individual has little ability and inaccurate role perception, his performance may be ineffective in spite of his putting in great efforts. Rewards - Performance is seen as leading to intrinsic rewards and extrinsic rewards. However, the intrinsic rewards are much more likely to produce attitudes about satisfaction that are related to performance. In addition, the perceived equitable rewards vitally affect the performance: - satisfaction relationship. They reflect the fair level of rewards that the individual feels should be give for a given lever of performance. Satisfaction - Satisfaction is derived form the extent to which actual rewards fall short, meet or exceed the individuals perceived level of equitable rewards Advantages A. It explains all types of variables underlying in a motivation process. 61

B. The clearly shows the relationship between performance- reward system 14. Explain the McClellands needs theory? Motivation is the process of initiating and directing behavior defined by Victor Vroom. Edwin B. Flippo defined motivation as process of attempting to influence others to do your will through possibility of gain or reward. McClellands achievement theory states that our needs are acquired or learned on the basis of our life experiences. According to him these three needs are (a) Need for Achievement (nAch) It is the first motive for people. It is the desire to accomplish challenging tasks and achieve a standard of excellence in ones work. (b) Need for Affiliation (nAff) It is the second motive force for people. It is the desire to maintain warm, friendly, and relationships with others. (c) Need for Power (nPow) The Need for Power is the desire to influence others and control ones environment as important motivator in organization. Need for power has two forms, a) Personal Power. b) Institutional Power. 15. Explain the special motivational techniques? Motivation is the process of initiating and directing behavior defined by Victor Vroom. Edwin B. Flippo defined motivation as A process of attempting to influence others to do your will through possibility of gain or reward. Reinforcement theory is the special motivational technique adopted that examines the effects and those consequences that has on motivation and behavior. The two principal approaches that can be used to increase the probability of behavior desired by the manager or the organization are as follows,

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1. Positive Reinforcement are desirable consequences often referred to as rewards, being given or applied, increase the likelihood of behavior being repeated in the future. For positive reinforcement to be effective in motivating behavior in organizational settings, they should have the following attributes. (a) Equitable (b) Efficient (c) Available (d) Not Exclusive (e) Visible (f) Reversible 2. Negative Reinforcement removal of undesirable consequences, that is, consequences that a person performing an act does not want, can increase the likelihood of that behavior being repeated in the future. The removal of such undesirable consequences is called a negative Reinforcement. For negative reinforcement to be effective, they should have the following attributes. (a) Punishments (b) Extinctions 16. Explain the types of communication? Communication is the process by which information is transmitted between individuals and / or organisations so that an understanding response results. Communication is an exchange of facts, ideas, opinions, or emotions by two or more persons. Communication can be categorized into different types depending upon the level at which it takes place, the direction it takes, or by its very nature. Some of the common types of communication are: - Personal Communication - Business Communication - Internal Communication - External Communication - Upward Communication - Downward Communication 63 - Formal Communication - Informal Communication - Mass Communication - Global Communication - Lateral Communication - Interactive Communication

- Social Communication

- Grapevine

17. Explain the communication methods in detail? Communication is the process by which information is transmitted between individuals and / or organisations so that an understanding response results. Communication is an exchange of facts, ideas, opinions, or emotions by two or more persons. The methods or the channels of communication appropriately chosen in the communication process add to the efficiency and reliability of the message. The choice of the channel would be influenced by factors like availability, cost, urgency and reliability. The various methods or the channels of communication are:

- Oral - Non-verbal - Visual - Audio-visual - Silence - Written. 18. Explain the difference between single channel and multiple channel of communication? Communication is the process by which information is transmitted between individuals and / or organizations so that an understanding response results. Communication is an exchange of facts, ideas, opinions, or emotions by two or more persons. A single channel communication network prescribes only one path of communication for any particular position and all communications in that position would have to flow through that path only. It helps in, - exercising control over the subordinates - fixation of responsibility in respect of activities to a person - maintaining the organization 64

- supporting the authority of the superiors - providing closeness of contacts and - reducing chances of miscommunication. A multiple channel communication network provides a number of communication channels linking one position with various other positions. It helps in, - allowing free flow of information - having less possibilities of information transmission errors - screening information at one particular filter point and - giving more freedom to subordinates. 19. Explain the different theories of Leadership? Leadership is the process of influencing the behaviour of others to work willingly and enthusiastically for achieving predetermined goals. It is essentially a continuous process of influencing behaviour. It is the process of influencing and supporting others to work enthusiastically toward achieving objectives. 20. Explain the Trait approaches to leadership theories? Unit V - CONTROLLING 2 Marks 1. What is Control? Control is a process that guides activity towards some predetermined goals. 2. Define control. According to Koontz, Controlling is the measurement and correction of performance in order to make sure that enterprise objectives and the plans devised to attain them are accomplished. 3. What are the characteristics of control? The characteristics of Control are: Universal Continuous process Action-based and 65

 Looking Back. 4. Why need of control in the organization? Need for control include: Control can minimize the mistakes It discovers the deviation in the management and It minimizes dishonest behaviour of employees

5. What are the importance of controlling? The importance of controlling are: Control helps to review, revise and update the policy of the organization The sound control system inspires employees to work hard and give better performance. Control helps to increase the coordination of the subordinates in the organization Proper control ensures organization effectives and efficiency.

6. What are the disadvantages of control? The disadvantages of control are: Control is expensive and time consuming process Human behaviour and employee morale cannot be measured. 7. What are the interrelationship between planning and control? The management process begins with planning and ends with control . Planning determines standards for performance, control helps in achieving them. 8. Give some critical point standards of control. Cost Standards 66

 Revenue standards Goal standards Program standards 9. What are the types of control? Feedback control Concurrent control Feed forward control 10. What is feedback control? Feedback control is the process of adjusting future action on the basic of information about the past performance. 11. What is concurrent control? This control measures for taking corrective action while any programme meets any obstacle in the activities. 12. What is feed forward control? Feed forward control is preventive in nature. This control involves evaluation of inputs and taking corrective action before a particular operation is completed. 13. List the differences between feedback control and feed forward technique. Feed Back Feed Forward i. It measures only output of the i. It measures input of the process. ii. It is submissive approach. ii. It is aggressive approach. iii. Less benefit. iii. More benefit. 14. What are the requirements for effective control? Requisites for effective control: The control should be economical. It must be simple. It should be flexible. It should have clear objectives. 67

15. What is Management By Exception (MBE)? Management By Exception (MBE) is the method of management in which subordinates report to an organizational manager only exceptional events or deviations from a plan that might call for decision making by the manager. 16. What are the traditional techniques of control? The traditional techniques of control are: Personal observation Break Even Analysis Statistical Report and Budgetary control. 17. What are the modern techniques of control? The modern techniques of control: Management Audit Return on Investment PERT & CPM and MIS. 18. Define Budget. According to Jfred Meston A budget is the expression of a firms plan in financial form for a period of time in to the future. 19. Define Budgetary Control. According to J.Batty, A system uses budgets as a means of planning and controlling all aspects of producing and selling commodities and services\". 20. What are the classifications of budget? Classifications of Budget: Functional classification Time classification Activity level. 68

21. Classify Budgets on the basis of Time. Short term Budget Current Budget Long term Budget 22. What data is required for preparation of sales budget? Past Sales data Plant capacity Financial resources available Raw materials available 23. What are the steps in ZBB process? Decision package Ranking and Allocation of resources. 24. Define Multinational Corporation. An enterprise that owns or controls production or service facilities outside the country in which they are based. 25. What are the attitudes needed by a MNC manager? Ethnocentric Polycentric Geocentric

26. What is Ethnocentric? The manager orientation and managerial activities, operations was based on that of the parent company. Small company entering international market operates with minimal risk and commitment. No international investment and additional selling cost incurred, administered by an export department. 27. What is Polycentric? 69

Polycentric attitude, manager orientation was host country orientation. Company establishes a foreign subsidiary company. Decentralizes all the operations, formulates the policy, strategies and designs the product based on the host country. 28. What is Geocentric? This type of managers is trained to balance central, local and global objectives . Company adopts global strategy but allows value addition to the customer of a domestic country. 30. What are the factors influencing MNC? Political factor Legal factor Economic factor Socio-cultural factor 31. What is MIS? A system of obtaining, abstracting, storing and analyzing the data to produce information and to use in planning, controlling and decision-making by managers at the time they can most effectively use it.

16 Marks 1. Explain the importance of control in a business enterprise. Discuss the process of control. What are the requirements of an effective control system? 2. What is a budget? Explain budgeting as tools of control. 3. Explain the classifications of Budget. Definition of budget - types of budget - advantages of budgetary control conclusion. 4. Explain the main features of Zero Base Budgeting. Definition of Zero based budgeting - features of Zero base budgeting conclusion. 5. What are the effective steps for direct control and preventive control? Definition of control - steps involved in control - steps involved in preventive control - conclusion

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6. What is PERT? Explain its characteristics, advantages and limitations. Definition of PERT- characteristics advantages - limitations- applications conclusion. 7. Explain briefly the control techniques. Definition of control - control techniques may be classified as traditional and modern - conclusion. 8. Discuss the control process and types of control. Definition of control Step in process of control types of control Conclusion. 9. What are the characteristics of control? Explain its need for management? Definition of control characteristics of control need of control conclusion. 10. Explain the characteristic of an ideal control system. Definition of control suitable flexible economical simple objective prompt - forward looking suggestive - strategic point control motivational - conclusion. 11. Define control. Describe the features of a good control system. Definition of control - Characteristics of control conclusion. 12. What are the various good qualities of efficient controlling system? Definition of control Significance of control conclusion. 13. Planning is looking ahead but controlling is looking back. Explain. Definition of control - Definition of planning - interrelation between planning and control Conclusion. 14. Coordination is the essence of management\". Definition of coordination - characteristic of coordination need problem principles - conclusion. 15. Explain Management By Exception. Definition of MBE characteristics - advantages of MBE - limitations of MBE. 16. State briefly the nature and application of Information technology. Definition of IT - Network analysis - Information Technology affect the global organization - nature of information technology - applications of IT - conclusion. 71

17. Why do companies decide to go international? Also explain the merits and limitation of multinational company. Definition of International business - Reasons for internationalization - Definition of MNCs - merits limitation of MNCs Conclusion. 18. Explain the various approaches of International business. Definition of International business - ethnocentric, geocentric, polycentric, region centric conclusion. 19. Explain a unified global theory of management? Definition of International business Globalization - empowerment satisfying the need of organization and global customers Conclusion. 20. What are the types of attitudes for International Manager? Definition of International business - coordination of subordinates - creating good organizational climate - cross-cultural training - creating global environment Conclusion. 21. Write short notes on International Management. Definition of International business Approaches - modes of entry of international business - conclusion. 22. Explain the various modes of entry to international management. Definition of International business export franchising licensing MNC strategic alliance - conclusion. 23. Explain the role of operation research in control techniques. Definition of control - operation research as a control technique advantages limitations - conclusion. 24. Explain the various stages of international business management. Definition of International business - domestic company - export division MNC transnational company conclusion. 25. Briefly explain the corporate and global strategy of MNEs. Definition of MNEs satisfying the domestic consumers - career anchors - strategic alliance - corporate alliance - conclusion. 19. GLOBAL THEORY OF MANAGEMENT: Empirical approach 72

Systems thinking Situational and contingency approaches Motivation and leadership theory Organization behavior Technology Clarification of semantics 20. INTERNATIONAL MANAGERS: MNC manager must have proper orientation towards technological, economical, foreign people and resources. Perlmutter has found three types of attitudes. Ethnocentric attitude Polycentric attitude Geocentric attitude

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INTERNATIONAL MANAGEMENT: International management involves conducting business and industrial operations in foreign countries and is affected by cultural and national influence. It involves free flow of ideas, technology, goods, information and management talent. MNC: A MNC is defined as An enterprise which own or control production or service facilities outside the countries in which they are based. CHARACTERISTICS: MNC top manager regards the entire world as the relevant frame of reference for making the kinds of resource acquisition, production and market identified. Reduction of unit costs through producing more units. The parent company and its foreign affiliates act in close alliance and cooperation with one another. ADVANTAGES: Economy benefits from multiplier and linkage effects resulting from better use of technology. Can promote quality products at lower cost. Helps to expand the markets. 74

Leads to increase the production exports and imports. Operation increases government revenues. Provides lower labour costs. DISADVANTAGES: Competence affects lower industries. Discourages competition among their subsidiaries. Utilizes local labour with low cost while obtaining high profits. Results in lack of development of local R & D.

INTERNATIONAL MANAGERS: MNC manager must have proper orientation towards technological, economical, foreign people and resources. Perlmutter has found three types of attitudes. Ethnocentric attitude Polycentric attitude Geocentric attitude FACTORS INFLUENCING MNC: Political and legal factors. Economic factors. Socio-cultural factors.

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MANAGERIAL FUNCTION AT INTERNATIONAL LEVEL PLANNING: Decides what to do, how to do, when to do and who is to do. Strategic plans are formulated by top management of parent company. Since it is far from host company, it causes communication gap, delay in communication and transmission loss. These gives difficulty to take strategic decisions. This can be effective by making global economic and political forecast. ORGANIZING: Identification and analysis of activities required for achievement of objectives. Establishes harmonious relation among the members of organization. Some countries prefer participative style of management countries. Any MNC organization structure should be acceptable to the people of host countries. The structure should by flexible and dynamic. STAFFING: 76

Managers of MNC can be classified into three types: Top executives and their key subordinates are sent from home country.. This type of managers knows well about parent companies policies, rules and procedures. The organization may select managers who belong to the host country. These managers know well about local politics, local customers, local suppliers, government procedures and rules. Organization may appoint managers other than the host or home country. DIRECTING: Process which is related to instructing, guiding and inspiring the human factors in an organization to achieve its objectives. Consists three important elements namely Motivation Leadership Communication Subordinates are stimulated to work effectively by effective motivation. CONTROLLING: Degree of control differs from country to country. Some follow a tight control over operation, while others follow autonomy of operations. Punctuality and sinceriority are not important for some countries and some give preference to that values. 23. OPERATION RESEARCH: Operational research is an experimental and applied science developed for observing understanding the purposeful man-machine systems and operations research workers are actively engaged in applying this knowledge to practical problems in business government and society. NECESSITY OF OPERATIONS RESEARCH: Uncertainity Responsibility and authority 77

OR models Complex organization Optimization of resources Minimizing time Maximizing profit Minimizing cost AND MANAGEMENT ROLE OF OPERATION RESEARCH IN BUSINESS: Production management Finance management Purchasing and procurement Distribution Marketing Financial PHASES OF OR: Formulation of the problems Construction f a mathematical model Solving the model Controlling and operating Testing the model and its solution Implementation LIMITATIONS: Mathematical model are applicable to only specified problems OR method not to take account qualitative OR method are not considered the human factors 78

Management which has to implement OR creates a lot of resistance from the employees.

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