Principles and Practices of Management (DMGT 101) PDF

Principles and Practices of Management (DMGT 101) Short Questions: Ques 1. List down the steps in planning process. The following are the steps involved in planning process:- 1. Establishing Objectives 2. Develo...

Principles and Practices of Management (DMGT 101) Short Questions: Ques 1. List down the steps in planning process. The following are the steps involved in planning process:- 1. Establishing Objectives 2. Developing Premises 3. Collection & Classification of Data 4. Evaluating Alternatives & Selection 5. Formation of Derivative Plans 6. Communication of Plans 7. Controlling of Plans Ques 2. Write 7-S model given by Mckinsey. The McKinsey‟s 7-S Framework is management model or framework which describes seven factors which should be organized by a company in an efficient way. These factors describe the way in which a company operates. These factors are:- 1. Strategy 2. Structure 3. Systems 4. Shared Values 5. Skills 6. Style 7. Staff Ques 3. What is span of management? Span of management refers to the number of subordinates that a manger can efficiently manage. Number of subordinate directly reporting to a manager is known as span. Depending upon the complexity of organisational activities and relationships amongst superiors and subordinates, it becomes important the superiors manage an optimum number of subordinates that result in optimum organisational output. All the subordinates cannot be managed by one superior. There has to be a limit on the number of subordinates who can be effectively managed by one superior. Ques 4. Define Functional Organization. In this form of organization, all activities of the enterprise are grouped and divided according to functions like production, marketing, finance and others. Each department is in the charge of a specialist who is called functional manager. The functional manager has a control over the functions in his charge and no matter on those functions found in other part of the organization. Ques 5. Differentiate between centralization and decentralization. Centralization Decentralization 1. It is a Systematic reservation of 1. The Delegation of Decision Making authority at central Points. authority at all levels of organization. 2. It brings uniformity in policies and 2. It may lead to inconsistencies because plans. uniform procedures are not followed in different departments. 3. It is suitable for small Organization. 3. It is suitable for Large Organization. 4. It involves low cost because only few 4. It involves higher cost because the officials manage the whole business. whole organization is divided into self- sufficient departments. 5. Only few trained and professional at 5. A large number are required as every the top management level only. department is controlled by independent manager. Ques 6. List the advantages of career development. 1. It reduces employee turnover by providing increased promotional avenues. 2. It improves employee morale and motivation. 3. It enables organizations to man promotional vacancies internally, thereby providing opportunities to reduce the cost of managerial recruitment. 4. It ensures better utilization of employees‟ skills and provides increased work satisfaction to employees. 5. It makes employees adaptable to the changing requirement of the organization. 6. It reduces industrial disputes related to promotional matters. Ques 7. What are the forces of change in organizations? These forces are of two types as follows: - External Forces: - Technological Change, Globalization, Social and Political Changes, Workforce Diversity. Internal Forces: - Changes in Managerial Personnel, Declining Effectiveness, Changes in work climate, Crisis. Ques 8. What is „Halo-Effect‟? The halo effect is a psychological phenomenon that allows a general opinion of something, or someone, to be gathered from one element. For example, if a chef is famous for making one particular dish, then the halo effect allows people to assume that he can cook anything with equal proficiency. Ques 9. What are cross-functional teams? Cross-functional teams are made up of employees from about the same hierarchical level, but from different work areas, who come together to accomplish a task. Cross-functional teams are an effective way to allow people from diverse areas within an organization (or even between organizations) to exchange information, develop new ideas, solve problems and coordinate complex projects.  Ques 10. What are Quality Circles? A group of employees who perform similar duties and meet at periodic intervals, often with management, to discuss work-related issues and to offer suggestions and ideas for improvements, as in production methods or quality control. Ques 11. Define Delphi Technique of group decision-making. This technique is used to collect information from physically dispersed persons by means of a written questionnaire. This technique permits collection of ideas from experts placed in different locations. The members are not influenced by one another, as there is no face-to-face interaction. Ques12. What are the essential components in business forecasting? Ans. 1. Developing the groundwork 2. estimating future business 3. comparing the actual with estimated results 4. refining the forecast process Ques13. What is meant by delegation, authority and Power Ans. Delegation is the act of assigning formal authority and responsibility to the subordinate to carry out specific activity. Authority is a form of power. Authority is often used more broadly to refer to a person‟s ability to exert power as a result of quality such as knowledge or titles such as judge. Formal authority is the type of power that is associated with organizational structure and management. Power is the ability to exert influence on other people. Power can be present in any relationship. In an organization manager exert power on subordinates. Long Questions(10 marks) Q1.What is planning? Explain various types of Plans. Ans. Planning is the most important function in management. Planning bridges the gap from where we are to where we want to go. Planning is deciding in advance what is to be done, when is to be done, where is to be done, how is to be done and by whom it should be done. Types of Plans 1. Strategic plans 2. Tactical plans 3. Contingency plans 1. Operational Plans:- The specific results expected from departments, work groups, and individuals are the operational goals. These goals are precise and measurable.  Single-use plans: These plans apply to activities that do not recur or repeat. A one-time occurrence, such as a special sales program,  is a single-use plan because it deals with the who, what, where, how, and how much of an activity.  Continuing or ongoing plans: These are usually made once and retain their value over a period of years while undergoing periodic revisions and updates. 2. Strategic Plans:- A strategic plan is an outline of steps designed with the goals of the entire organisation as a whole in mind, rather than with the goals of specific divisions or departments. Strategic planning begins with an organisation‟s mission. Strategic plans look ahead over the next two, three, five, or even more years to move the organisation from where it currently is to where it wants to be. Requiring multilevel involvement, these plans demand harmony among all levels of management within the organisation. Top-level management develops the directional objectives for the entire organisation, while lower levels of management develop compatible objectives and plans to achieve them. Top management‟s strategic plan for the entire organisation becomes the framework and sets dimensions for the lower level planning. 3. Tactical Plans:- A tactical plan is concerned with what the lower level units within each division must do, how they must do it, and who is in charge at each level. Tactics are the means needed to activate a strategy and make it work. Tactical plans are concerned with shorter time frames and narrower scopes than are strategic plans. These plans usually span one year or less because they are considered short-term goals. 4. Contingency plans:- A contingency is an unexpected event or situation that affects the financial health, professional image, or market share of a company. It is usually a negative event, but can also be an unexpected windfall such as a huge order. Contingency planning involves identifying alternative courses of action that can be implemented if and when the original plan proves inadequate because of changing circumstances. Q2. Give the definition of Decision Making and explain the process of Decision Making. Ans. A decision is the selection of a course of action. Decision is a choice whereby a person comes to a conclusion about given circumstances/ situation. It represents a course of behavior or action about what one is expected to do or not to do. Decision Making may be defined as a selection of one course of action from two or more alternative course of action. A decision can be defined “as a course of action consciously chosen from available alternatives for the purpose of desired result.” 1. Define the Problem:- The first step in the decision-making process is to define the real problem. A problem can be explained as a question for and appropriate solution. The manager should consider critical or strategic factors in defining the problem. The manager should consider critical or strategic factors in defining the problem. These factors are infact obstacles in the way of finding proper solution. 2. Analyzing the Problem:- After the problem have been defined the next important step is a systematic analysis of the available data or information. Sound decisions are based on proper collection, classification and analysis of facts and figure. 3. Developing Alternative Solution:- After defining and analyzing the problem, the next step is to develop alternative solutions. The main aim of developing alternative solutions. The main aim of developing alternative solution is to have the best possible decision out of the available alternative courses of action. We have to list the all possible alternatives of the solution to that problem. 4. Selecting the best type of Alternative:- After developing various alternatives, the manager has to select the best alternative. Following Points should be kept in mind while selecting the alternative:- (a) Risk element involved in each course of action against the expected gain. (b) Securing desired results with the least efforts. (c) Proper timing of the decision and action should also be taken into consideration. (d) Final selection of decision is also affected limitation of resources at our disposal. Decision Making Process Define the Problem Analysing the Problem Developing Alternative Solution Selecting the best type of Alternative Implementation of the decision Follow Up 5. Implementation of the decision:- Under this Step, a manager has to put the selected decision into action. For proper and effective execution of the decision three things are important:- (a) Proper and effective communication of decision to the subordinates is very important. (b) Acceptance of decision by the subordinates is important. 6. Follow Up:- A follow up system ensures the achievement of the objectives. It is concerned with the process of checking the proper implementation. Q3. Define recruitment. What are the various sources of recruitment? Ans. Recruitment is the process of searching for prospective employees and stimulating them to apply for the jobs in the organization. Recruitment stands for discovering the source from where potential employees will be selected. The recruitment function is very important because the end result of recruitment function is receiving large number of applications to make selection from. Sources of Recruitment:- The sources of recruitment may be broadly divided into two categories: internal sources and external sources.  Transfer Internal Sources  Promotion Sources Of Recruitment  Direct Recruitment  Media Advertising  Employment Exchange External Sources  Campus Recruitment  Recommendations from present Employees  Web Publishing 1. Internal Sources:- Under internal source of recruitment vacant job positions are filled by inducing the existing employees of the organization. Under the internal recruitment following methods of recruitment are used:- (a) Transfer:- Transfer means shifting of employees from one job position to other at the same level of authority. There is no change even in his rank, responsibilities and prestige. Only the place of working is changed. For example: Transfer of clerk from accounts department to purchase department. (b) Promotion:- Promotion refers to shifting of employees from one job position to other with higher level of authority. The authority level, rank, responsibilities of employees and prestige increase.  For example: Promotion of clerk to accountant post. 2. External Sources:- When the candidates from outside the organization are invited to fill the vacant job position then it is known as External Recruitment. When the organization meets its manpower recruitment from outside the organization then it is external recruitment. (a) Direct Recruitment: Sometimes the organizations paste notice at the gate of their office or factory stating the vacant positions. The people who are interested in those jobs walk in for interview. (b) Media Advertising: The most common and popular method of external recruitment is advertising about the vacant job position. The organizations select the media of advertisement keeping in mind the requirement of job position. (c) Employment Exchanges: Employment exchanges act as middlemen between the job seekers and the organizations who have vacant job positions. The job seekers leave their bio-data and details of their qualifications with the employment exchanges and when the organizations approach employment exchanges the suitable candidates are sent. (d) Campus Recruitment: Sometimes the senior managers of the organizations visit various professional colleges, technical institutes to get fresh graduates or the people with the latest technological know- how. This type of recruitment is more common for engineers, computer programmers, MBAs etc. (e) Recommendations from present Employees: Many firms encourage their employees to recommend the names of their relatives, friends and other known people to fill the vacant job position. The organizations prefer recommendations by trusting the goodwill of the present employees and the organizations (f) Web Publishing: In internet there are certain websites specifically designed provide information regarding job seekers and companies which have vacant job position. These websites can be visited by job seekers as well as companies: Naukri.com, Monster.com etc. Q4. Define performance appraisal. Briefly discuss the traditional and modern techniques of performance appraisal. Ans. Performance Appraisal: Performance Appraisal is the systematic evaluation of the performance of employees and to understand the abilities of a person for further growth and development. The process by which a manager or consultant examines and evaluates an employee's work behavior by comparing it with preset standards, documents the results of the comparison, and uses the results to provide feedback to the employee to show where improvements are needed and why. Performance appraisals are employed to determine who needs what training, and who will be promoted, demoted, retained, or fired. Traditional Methods of Performance Appraisal: The Traditional Methods of Performance Appraisal are as follows:- 1. Straight Ranking Method: This is the oldest and simplest method of performance appraisal by which employees are tested in order or merit giving some numerical rank and placed in a simple grouping. Such grouping separates employees under each level of efficiency, which may vary from most efficient to least efficient. 2. Paired Comparison Techniques: This is a somewhat better method of performance appraisal as each employee is compared with others in pairs at a time. For each performance trait, an individual employee‟s performance is tallied with others in pairs and then rank order is decided. This system is also not suitable in those cases where the number of employees are usually high. 3. Man-to-Man Comparison: Under this method certain factors are selected for analysis, like; leadership, initiative, interpersonal relationship, etc., and a scale is designed by a rater for each such factor. After rating such factors individually and accordingly, the aggregate performance of an individual employee is decided and such aggregative performance is also given a scale. 4. Forced Choice Description Method: It is a combination of objective and subjective judgment on an individual employee‟s performance against each rating element. Positive and negative phrases are given asking the rater to indicate applicability of such phrases as objectives in describing the employee whose performance is rated. 5. Checklist Method: The rater is given a checklist of the descriptions of the behavior of the employees on job. The checklist contains a list of statements on the basis of which the rater describes the on the job performance of the employees. A checklist represents, in its simplest form, a set of objectives or descriptive statements about the employee and his behavior. If the rater believes strongly that the employee possesses a particular listed trait, he checks the item; otherwise, he leaves the item blank. Modern Methods of Performance Appraisal: The Modern Methods of Performance Appraisal are as follows:- 1. Management by Objectives: Management by Objectives (MBO) is a comprehensive management approach which is adopted for performance appraisal and so also for organizational development. When MBO is used for performance appraisal only, its primary focus is on developing objective criteria for evaluating the performance of the individuals. Identification of common goals is jointly done by the superior and subordinate managers of  an organization. After such identification, each individual‟s major area of responsibilities is defined. Such defined responsibility becomes the basis for evaluating the performance of the individual employee. 2. The 360 degree appraisal: The 360 degree method of performance appraisal is used to make the appraisal process more transparent, objective and participative. It introduced the concepts of self appraisal subordinates appraisal, peer appraisal and appraisal by customers. It is called a 360 degree method because it involves the evaluation of an employee by persons above him, below him and alongside him. 3. Human Resource Accounting Method: Human resources are a valuable asset for any organization and it can be valued in monetary terms. This method evaluates the performance of an employee in terms of costs and contributions. HR costs include expenses incurred on HR planning recruitment selection induction and training. The difference between this costs and the contribution by an employee reflects the performance of that employee. 4. Behaviorally anchored rating scale (BARS): This method combines the graphic rating scale and the critical incident method. It determines in advance the critical areas of the performance and the most effective behavior to achieve the results. Then the actual job behavior of an employee is evaluated against the predetermined behavior.. 5. Potential appraisal: It is different from performance appraisal as it refers to the abilities of the employees that are not being used at the time of appraisal. It searches for the latent abilities of the employee in discharging higher responsibilities in future. The potential of the employees is judged on the basis of his present performance, personality traits, past experience and age and qualification. Q5. What are the various barriers to effective communication? Discuss the measures to overcome these barriers. Ans. Barriers to Effective Communication: Barriers to communication are factors that block or significantly distort successful communication. The more prominent barriers to effective communication which every manager should be aware of is given below: 1. Filtering: Filtering refers to a situation where sender manipulating information so it will be seen more favorably by the receiver. The major determinant of filtering is the number of levels in an organization‟s structure. The more vertical levels in the organization‟s hierarchy, the more will be the opportunities for filtering. 2. Selective Perception: Selective perception means seeing what one wants to see. The receiver, in the communication process, generally resorts to selective perception, i.e., he selectively perceives the message based on the organizational requirements, the needs and characteristics, background of the employees, etc. Perceptual distortion is one of the distressing barriers to the effective communication. 3. Emotions: How the receiver feels at the time of receipt of information influences effectively how he interprets the information. 4. Language: Communicated message must be understandable to the receiver. Often, communication gap arises because the language the sender is using may be incomprehensible, vague and indigestible. Language is a central element in communication. 5. Stereotyping: It is the application of selective perception. When we have preconceived ideas about other people and refuse to discriminate between individual behaviors, we are applying selective perception to our relationship with other people. 6. Status Difference: The organizational hierarchy poses another barrier to communication within the organization, especially when the communication is between employee and manager. 7. Use of conflicting signals: A sender is using conflicting signals when he or she sends inconsistent messages. A vertical message might conflict with a non- verbal one. 8. The “Halo Effect”: The term “halo effect” refers to the process of forming opinions based on one element from a group of elements and generalizing that perception to all other elements. Overcoming Barriers to Communication Following are some of the additional measures to overcome the barriers to communication: 1. Fostering good relationships: Strong relationships must be fostered between the employer and employee in order to avoid misunderstandings. 2. Purposeful Communication: Communication should be purposeful and directed to an individual. 3. Co-ordination: Co-ordination between superior and subordinates. 4. Avoid technical language: The specialized language should be avoided. 5. Feedback: The selective perception of receiver should be minimized through proper feedback. 6. Accuracy: There should be accuracy in the message to be transmitted between both parties for the communication to improve its effectiveness. 7. Clarity in message: The message to be transferred should be clear, practical accurate and without any ambiguity. 8. Communication of organisational philosophy: Efforts have to be made in a planned way to sensitize people with the organisational philosophy. 9. Flat organisational structure: The organisation should have clear cut and simple organisational structure. 10. Division of labour: There should be proper division of labour between people in order to reduce information overload and prevent delay in information transfer. 11. Organisation policies: The organisation should formulate its policies in such a way that it will give full advantage to all members of the organisation. 12. Minimize semantic problem: People should avoid using double meaning words. Q6. What is motivation? Explain any two theories of motivation. Ans. Motivation: Motivation can be defined as a process of stimulating people to act for the purpose of achieving desired goals. Motivation can be defined as a willingness to expend energy, to achieve the goal or a reward. Theories of Motivation: Here are the theories of Motivation. Maslow‟s theory of Human Motivation: According to Abraham Maslow, there are five kind of needs viz., physiological, safety, social esteem and self actualization. 1. Physiological Needs: Physiological needs refer to those needs which are so essential that the survival of human beings will be in danger, if these are not satisfied e.g. food, shelter, clothing, water air, sleep etc. These needs are biological in nature and keep the body fit. There is a famous saying that a man can live on bread alone if there is no butter. 2. Safety Needs: After the Psychological Needs are satisfied to a reasonable degree, the safety needs take the place e.g. security of job, pension for old age, insurance plan. In choosing a job, security plays an important role. 3. Social Needs: Social needs include needs for love, affection, friendship. A man is social being and he has a need to love and to be loved. Workers form informal groups for having meaningful relationship with others 4. Esteem Needs: These needs are concerned with one‟s self esteem such as self-respect, self confidence, status, recognition, etc. The satisfaction of these needs produces a feeling of self confidence among the employees. 5. Self Actualization Needs: These needs include need for self development, self actualization, desire to take increased responsibilities etc. Not many  employees try to fulfill these needs but an employee who wants to develop, will feel restless till he satisfies his need. Herzberg‟s theory of motivation: Frederick Herzberg developed the two factor theory popularly known as motivation hygiene theory.it was based on the content of interview s conducted on 200 engineers and accountants. He found that there are two sets of needs viz: (a) Hygiene or environmental factors. These factors (extrinsic) such as interpersonal relations with supervisors, salary, security, working conditions, status, do not motivate the satisfaction although they result in job satisfaction.thus, the absence of extrinsic factors causes‟ dissatisfaction among the employees. They are called extrinsic factors because they are considered outside the work being performed. Traditionally, the management had perceived these factors as motivators. (b) Motivational factors. These factors are called satisfiers or intrinsic factor because they are real causes of job satisfaction as they primarily exits within the context of the work being carried out. These factors Include recognition, opportunity for growth, increased responsibility, challenging work, potential for personal growth. Q7. What do you understand by control? Explain the steps in a control process. Ans. Control: Control can be defined as comparison of actual performance with the planned performance. If there is any difference then finding the reasons for such difference and taking corrective measures to stop those reasons so that in future there is match between actual and planned performance. Control function leads to goal achievement, an organization without effective control is not likely to reach its goal. Controlling is not the last function of management but it is the function which being back the management cycle to planning. Process of Control: The following are the steps involved in Controlling Process:-  Comparing Establishing Measuring of Performance Standards Performance with Standards Taking Analysing the Corrective deviations Action 1. Establishing standards: Standards are criteria against which results are measured. They are norms to achieve the goals. Standards are usually measured in terms of output. They can also be measured in non-monetary terms like loyalty, customer attraction, goodwill etc. Some of the standards are as. 2. Measuring performance: Measurement involves comparison between what is accomplished and what was intended to be accomplished. The measurement of actual performance must be in the units similar to those of predetermined criterion. The unit or the yardstick thus chosen be clear, well-defined and easily identified, and should be uniform and homogenous throughout the measurement process. 3. Comparing the actual performance with expected performance: This is the active principle of the process. The previous two, setting the goals and the measurement format are the preparatory parts of the process. It is the responsibility of the management to compare the actual performance against the standards established. This comparison is less complicate if the measurement units for the standards set and the performance measured are the same and quantified. 4. Correcting Deviations: The final element in the process is the taking corrective action. Measuring and comparing performance, detecting shortcomings, failures or deviations, from plans will be of no avail if it does point to the needed corrective action. The required corrective action can be determined from the qualified data as per the standards laid out and the performance evaluation already done. This step should be taken promptly, otherwise losses may be cumulative and remedial action will be all the more difficult to take. Q8. What is MBO? Explain the steps in MBO Process. Ans. Definition: MBO is a management practice which aims to increase organizational performance by aligning goals and subordinate objectives throughout the organization. In other words, MBO involves focusing more on results rather than the activities involved. The top management is essentially negotiating a contract of goals with their subordinates without dictating a detailed roadmap for implementation. Process of MBO: The process of MBO consists of the following steps: 1. Defining the Goal: Defining and verifying organizational objectives is the first step in MBO process. Generally these objectives are set by central management of the organization but it does so after consulting other managers. Before setting of these objectives, an extensive assessment of the available resources is made by the central management. It also conducts market service and research along with making a forecast. Through this elaborate analysis, the desired long run and short run objectives of the organization are highlighted. The central management tries to make these objectives realistic and specific. After setting these goals it is the responsibility of the management that these are known to all members and are also under stood by them. 2. Development and individual goal setting: After organization objectives are established by the central management, the next step is to establish the department goals. The top management needs to discuss these objectives with the heads of the departments so that mutually agreed upon objectives are established. Long range and short range goals are set by each department in consultation with the top management. After the department goals are established, the employees work with their managers to establish their own individual goals which relate with the organization goals. These participative goals are very important because it has been seen that employees become highly motivated to achieve the objectives established by them. 3. Matching Goals: The establishment of objectives cannot be fruitful unless the resources and means required to achieve these objectives are provided. Therefore the subordinates should be provided required tools and materials which enable them to achieve the objectives efficiently and effectively. Resource requirements can be measured precisely if the goals are set precisely. This makes the process of resource allocation relatively easy. Resource allocation should be made after consulting the subordinates. 4. Freedom implementation: The task team of manager and his subordinates should be given freedom in deciding the way to utilize their resources and the way to achieve their objectives. There should be very little or no interference by the seniors as long as the team is working within the framework of organization policies. 5. Establishing check points: The process of MBO requires regularly meetings between the managers and their subordinates to discuss the progress achieve in the accomplishment of the objective established for the subordinates. For this purpose the mangers need to establish the standards of performance or check points to evaluate the progress of their subordinates. 6. Performance Appraisal: An informal performance appraisal is generally conducted in routine by the manager, a periodic review of performance of the subordinates should also be conducted. Periodic reviews are required as the priorities and conditions change constantly and need to be monitored constantly. Q9. Elucidate the principles of management by Henry Fayol. Ans. Principles of Management by Henry Fayol: (1) Division of Work: This principle of Fayol tells us that as far as possible the whole work should be divided into different parts and each individual should be assigned only one part of the work according to his ability and taste rather than giving the whole work to one person. When a particular individual performs the same job repeatedly, he will become an expert in doing that particular part of the whole job. Consequently, the benefits of specialisation will become available. (2) Authority and Responsibility: According to this principle, authority and responsibility should go hand in hand. It means that when a particular individual is given a particular work and he is made responsible for the results, this can be possible only when he is given sufficient authority to discharge his responsibility. It is not proper to make a person responsible for any work in the absence of authority. In the words of Fayol, “The result of authority is responsibility. It is the natural result of authority and essentially another aspect of authority and whenever authority is used, responsibility are automatically born. (3) Discipline: Discipline is essential for any successful work performance. Fayol considers discipline to mean obedience, respect for authority, and observance of established rules. Discipline can be established by providing good supervision at all levels, clearly explaining the rules, and implementing a system of reward and punishment. A manager can present a good example to his subordinates by disciplining himself. (4) Unity of Command: According to the principle of unity of command, an individual employee should receive orders from only one superior at a time and that employee should be answerable only to that superior. If there are many superiors giving orders to the same employee, he will not be able to decide as to which order is to be given priority. He thus finds himself in a confused situation. (5) Unity of Direction: Unity of direction means that there should be one head for one plan for a group of activities having the same objective. In other words, there should be one plan of action for a group of activities having the same objective and there should be one manager to control them. (6) Subordination of Individual Interest to General Interest: This principle can be named „Priority to General Interest over Individual Interest.‟ According to this principle, the general interest or the interest of the organisation is above everything. If one is asked to place individual interest and the general interest in order of priority, definitely the general interest will be placed at the first place. (7) Remuneration to Employees: Fayol is of the opinion that the employees should get a fair remuneration so that the employees and the owners find equal amount of satisfaction. It is the duty of the manager to ensure that employees are being paid remuneration according to their work. If, however, they are not paid properly for their work, they will not do their work with perfect dedication, honesty and capacity. As a result, the organisation shall have to face failure. Proper remuneration depends on some factors like the cost of living, demand of labour and their ability. Fayol feels that in order to motivate the employees, apart from general remuneration, they should be given some monetary and non-monetary incentives. (8) Centralisation and Decentralisation: According to this principle, the superiors should adopt effective centralisation instead of complete centralisation and complete decentralisation. By effective centralisation, Fayol does not mean that authority should be completely centralised. He feels that the superiors should keep the authority of taking important decisions in their own hands, while the authority to take daily decisions and decisions of less importance should be delegated to the subordinates. (9) Scalar Chain: It refers to a formal line of authority which moves from highest to the lowest ranks in a straight line.This chain must be followed in a strict manner. It means each communication must move from top to bottom and vice versa in a straight line. The important condition here is that no step (post) should be overlooked during communication. (10) Order: According to the principle of order, a right person should be placed at the right job and a right thing should be placed at the right place. According to Fayol, every enterprise should have two different orders-Material Order for Physical Resources and Social Order for Human Resources. Keeping the physical resources in order means that „a proper place for everything and everything in its right place‟. Similarly, keeping the human resources in order means „a place for everyone and everyone in his appointed place‟. (11) Equity: This principle tells that the managers should treat their subordinates in a just and kind manner so that they develop a feeling of dedication and attachment for their work. All the employees should be treated equally and impartially. Fayol tells us in connection with this principle that there should not be any equality of treatment between a person whose work is really good and a person who is a shirker by nature. 12) Stability of Personnel: From the point of view of management it is absolutely harmful to change the employees frequently as it is a reflection of inefficient management. Therefore, according to this principle there should be stability of tenure of the employees so that the work continues efficiently. Fayol thinks that instability in the tenure of employees is a cause of poor management and results. High rate of labour turnover will result in increased expenses because of selecting them time and again, and giving them training afresh. (13) Initiative: Initiative means the capacity to work while expressing one‟s thoughts. According to Fayol, it is the duty of the manager to encourage the feeling of initiative among his employees for doing some work or taking some decision but within the limits of authority and discipline. It will be possible only when the manager will welcome the thoughts of his/her subordinates. By doing so the subordinates will present new and useful ideas time and again and gradually they will become an integral part of the organisation. In order to make this process a success a manager will have to abandon his false sense of prestige. 14) Esprit de corps: As per this principle, a manager should continuously make efforts to develop a team spirit among the subordinates. To do this, he/she should use the word „We‟ instead of” during the conversation with subordinates. Q10. Explain various techniques of Group Decision Making. Ans. Techniques of Group Decision Making 1. BRAINSTORMING: Brainstorming is a group decision making process in which negative feedback on any suggested alternative by any group member is forbidden until all members have presented alternatives that they perceive as valuable. Brainstorming is carefully designed to encourage all group members to contribute as many viable decision alternatives as they can think of. Its premise is that if the evaluation of alternatives starts before all possible alternatives have been offered, valuable alternatives may be overlooked. During brainstorming, group members are encouraged to state their ideas, no matter how wild they may seem, while an appointed group member records all ideas for discussion. Brainstorming offers the advantage of encouraging the expression of as many useful ideas as possible, but the disadvantage of wasting the group's time on ideas that are wildly impractical. 2. NOMINAL GROUP TECHNIQUE: The nominal group technique is another useful process for helping groups make decisions. This process is designed to ensure that each group member has equal participation in making the group decisions. It involves the following steps: STEP 1: Each group member writes down individual ideas on the decision or problem being discussed. STEP 2: Each member presents individual ideas orally. The ideas are usually written on a board for all other members to see and refer to. STEP 3: After all members present their ideas, the entire group discussed these ideas simultaneously. Discussion tends to be unstructured and spontaneous. STEP 4: When discussion is completed, a secret ballot is taken to allow members to support their favourite ideas without fear. The idea receiving the most votes is adopted and implemented. The nominal group technique, with its secret ballot, offers a structure in which individuals can support or reject an idea without fear of recrimination. Its disadvantage is that there is no way of knowing why individuals voted the way they did. 3. DELPHI TECHNIQUE: The Delphi technique involves circulating questionnaires on a specific problem among group members, sharing the questionnaire results with them, and then continuing to recirculate and refine individual responses until a consensus regarding the problem is reached. In contrast to the nominal group technique or brainstorming, the Delphi technique does not have group members meet face to face. The formal steps followed in the Delphi Technique are: STEP 1: A problem is identified. STEP 2: Group members are asked to offer solutions to the problem by providing anonymous responses to a carefully designed questionnaires. STEP 3: Responses of all group members are compiled and sent out to all group members. STEP 4: Individual group members are asked to generate a new individual solution to the problem after they have studied the individual responses of all other group members. STEP 5: Step 3 and 4 are repeated until a consensus problem solutions is reached. The advantage of the Delhi Technique is that ideas can be gathered from group members who are too geogrpahically separated or busy to meet face to face.Its disadvantage is that members are unable to ask questions of one another. Q11. Elaborate the steps in Selection Process. Ans. Selection is a process of choosing right person for the right job. The selection process consists of a series of steps or techniques as follows : 1. Job Analysis : The first step in selection process is analyzing the job. Job analysis consists of two parts : (a) Job Description, and (b) Job Specification. Proper job analysis helps to advertise the job properly. Accordingly, the right candidates may apply for the job, thus saving a lot of time and effort of the selectors. 2. Advertising the Job : The next step is to advertise the job. The job can be advertised through various media. The right details about the job and the candidate must be given in the advertisement. 3. Initial Screening : The initial screening can be done of the applications and of the applicant. Usually, a junior executive does the screening work. At this stage, the executive may check on the general personality, age, qualifications, family background of the candidate. The candidate may also be informed of salary, working conditions, etc. 4. Application Blank : It is a prescribed form of the company which helps to obtain information about candidate in respect of social, biographic, academic, work experience, references, etc. The application blank helps to provide input for the interview, provide basis to reject candidates if they do not meet eligibility criteria, such as experience, qualifications, etc. 5. Tests : Various tests are conducted to judge the ability and efficiency of the candidates. The type of tests depends upon the nature of job. An important advantage of testing is that it can be administered to a large group of candidates at a time and saves time and cost. The various tests are : (a) Personality test, (b) Intelligence test, (c) Performance test, (d) Stress test, etc. 6. Interview : It is face to face exchange of views, ideas and opinions between the candidate and interviewer(s). There are various types of interviews such as : (a) Panel Interview, (b) Individual Interview, (c) Group Interview, (d) Stress Interview, (e) Exit Interview. 7. Reference Check : A candidate may be asked to provide references from those who are willing to supply or confirm about the applicant‟s past life, character and experience. Reference check helps to know the personal character and family background of the candidate. It helps to guard against possible false information supplied by candidate. 8. Medical Check : Medical examination of the candidates is undertaken before they join the firm in order to -  Find out whether the candidate is physically fit to carry out duties and responsibilities effectively,  Ensure the health and safety of other employees,  Find out whether the candidate is sensitive to certain work place such as in a chemical factory. 9. Final Interview : Before making a job offer, the candidates may be subjected to one more oral interview to find out their interest in the job and their expectations. At this stage, salary and other perks may be negotiated. 10. Job Offer : This is the most crucial and final step in selection process. A wrong selection of a candidate may make the company to suffer for a good number of years and the loss is incalculable. Company should make a very important decision to offer right job to the right person. Q12. Who is a Manager? Discuss various functions of a Manager. Ans. Manager: A Manager is the person responsible for planning and directing the work of a group of individuals, monitoring their work, and taking corrective action when necessary. For many people, this is their first step into a management career. Functions of Managers Managers just don't go out and haphazardly perform their responsibilities. Good managers discover how to master five basic functions: planning, organizing, staffing, leading, and controlling. 1. Planning: Planning is the process of making decisions about future. It is the process of determining enterprise objectives and selecting future courses of actions necessary for their accomplishment. It is the process of deciding in advance what is to be done, when and where it is to be done, how it is to be done and by whom. Planning provides direction to enterprise activities. It helps managers cope with change. It enables managers to measure progress toward the objectives so that corrective action can be taken if progress is not satisfactory. Planning is a fundamental function of management and all other functions of management are influenced by the planning process. 2. Organising: Organising is concerned with the arrangement of an organisation‟s resources - people, materials, technology and finance in order to achieve enterprise objectives. It involves decisions about the division of work, allocation of authority and responsibility and the coordination of tasks. The function increases in importance as a firm grows. A structure is created to cope with problems created by growth. Through this formal structure, the various work activities are defined, classified, arranged and coordinated. Thus, organising refers to certain dynamic aspects: What tasks are to be done? Who is to do them? How the tasks are to be grouped? Who is to report to whom? Where the decisions have to be made? 3. Staffing: Staffing is the function of employing suitable persons for the enterprise. It may be defined as an activity where people are recruited, selected, trained, developed, motivated and compensated for manning various positions. It includes not only the movement of individuals into an organisation, but also their movement through (promotion, job rotation, transfer) and out (termination, retirement) of the organisation. 4. Directing: The function of guiding and supervising the activities of the subordinates is known as directing. Acquiring physical and human assets and suitably placing them on jobs does not suffice; what is more important is that people must be directed towards organisational goals. This work involves four important elements: (a) Leadership (b) Motivation (c)Communication (d) Supervision 5. Controlling: The objective of controlling is to ensure that actions contribute to goal accomplishment. It helps in keeping the organisational activities on the right path and aligned with plans and goals. In controlling, performances are observed, measured and compared with what had been planned. If the measured performance is found wanting, the manager must find reasons and take corrective actions. If the performance is not found wanting, some planning decisions must be made, altering the original plans. If the controlling function is to be effective, it must be preceded by proper planning. Q13. ”Organization is the backbone of management.” Comment. Ans. Organising: Organising is concerned with the arrangement of an organisation‟s resources - people, materials, technology and finance in order to achieve enterprise objectives. It involves decisions about the division of work, allocation of authority and responsibility and the coordination of tasks. The function increases in importance as a firm grows. A structure is created to cope with problems created by growth. Through this formal structure, the various work activities are defined, classified, arranged and coordinated. ”Organization is the backbone of management.”: We can consider the following points in light of this statement: 1. Specialisation: Under organising all the activities are subdivided into various works or jobs. For all the sub works, competent people are appointed who become experts by doing a particular job time and again. In this way, maximum work is accomplished in the minimum span of time and the organisation gets the benefit of specialisation. 2. Clarity in Working Relationship: Organising clarifies the working relations among employees. It specifies who is to report to whom. Therefore, communication becomes effective. It also helps in fixing accountability. 3. Optimum Utilisation of Resources: Under the process of organising the entire work is divided into various small activities. There is a different  employee performing every different job. By doing so, there is no possibility of any activity being left out or any possibility of unnecessary duplicating any job. Consequently, there is optimum utilisation of all the available resources (e.g., material, machine, financial, human resource, etc.) in the organisation. 4. Adaptation to Change: Organising process makes the organisation capable of adapting to any change connected with the post of the employees. This becomes possible only because of the fact that there is a clear scalar chain of authority for the manager‟s right from the top to the lower level. Whenever a managerial post falls vacant, it is immediately filled up by promotion. Since every subordinate is well aware of the working of his boss, there is no difficulty for his taking up the new post. 5. Effective Administration: It has generally been observed that there is always a condition of doubt about the authority of the managers among themselves. The process of organising makes a clear mention of each and every activity of every manager and also of their extent of authority. It is also made clear as to whom a manager order for a particular job shall. Everybody also knows to whom they are accountable. In this way, the confusion on authority is put to an end. Consequently, effective administration becomes possible. 6. Development of Personnel: Under the process of organising, delegation of authority is practiced. This is done not because of the limited capacity of any individual, but also to discover new techniques of work. It provides opportunities of taking decisions to the subordinates. By taking advantage of this situation, they try to find out the latest techniques and implement them. Consequently, it helps them to grow and develop. 7. Expansion and Growth: The process of organising allows the employees the freedom to take decisions which helps them to grow. They are always ready to face new challenges. This situation can help in the development of the enterprise. This helps in increasing the earning capacity of the enterprise which in turn helps its development. Q14. Is Planning Forward-looking or Backward-looking? Give reasons in support of your answer. Ans. Planning is forward looking process. It is often called futuristic process because a plan is a forecast for accomplishment. It is a predetermined course of action. It is today‟s projection for tomorrow‟s activity. In other words, to plan is to produce a scheme for future action, to bring about specified results at a specified cost, in a specified period of time. According to Koontz and O‟Donnell, “Planning is deciding in advance what to do, how to do it, when to do it and who is to do it.” It is deciding in the present, what is to be done in future. It is the process of thinking before doing. A plan is a specific, documented intention consisting of an objective and an action statement. The objective portion is the end, and the action statement represents the means to that end. Stated another way, objectives give management targets to shoot at, whereas action statements provide the arrows for hitting the targets. Properly conceived plans tell what, where and how something is to be done. Why Planning is forward looking process: Planning is an Intellectual Process: Planning is an intellectual process of thinking in advance. It is a process of deciding the future on the series of events to follow. Planning is a process where a number of steps are to be taken to decide the future course of action. Managers or executives have to consider various courses of action, achieve the desired goals, go in details of the pros and cons of every course of action and then finally decide what course of action may suit them best. Planning Contributes to the Objectives: Planning contributes positively in attaining the objectives of the business enterprise. Since plans are there from the very first stage of operation, the management is able to handle every problem successfully. Plan try to set everything right. A purposeful, sound and effective planning process knows how and when to tackle a problem. This leads to success. Objectives thus are easily achieved. Planning is a Primary Function of Management: Planning precedes other functions in the management process. Certainly, setting of goals to be achieved and lines of action to be followed precedes the organization, direction, supervision and control. No doubt, planning precedes other functions of management. It is primary requisite before other managerial functions step in. But all functions are inter-connected. It is mixed in all managerial functions but there too it gets precedence. It thus gets primary everywhere. Reduction of Uncertainty: Future is always full of uncertainties. A business organisation has to function in these uncertainties. It can operate successfully if it is able to predict the uncertainties. Some of the uncertainties can be predicted by undertaking systematic. Some of the uncertainties can be predicted by undertaking systematic forecasting. Thus, planning helps in foreseeing uncertainties which may be caused by changes in technology, fashion and taste of people, government rules and regulations, etc. Q15. Discuss the evolution of Management thought. What are the trends in management thought in present scenario? Ans. The evaluation of management can be categorized into different parts: o Classical management Era (1880-1930), o Neo-classical Management Era (1930-1950), o Modern Management era (1950-on word). Classical Management includes Scientific Management School and Administration Management School, Neo- classical Management includes Human relation school. Modern Management includes Social system school, System Management School, and Contingency Management School.  The Classical Approach-The classical approach is the earliest thought of management. (i) Scientific Management: Scientific management which is also referred to Taylorism or the Taylor system is a theory of management that evaluates and synthesizes workflows, with the aim of improving labour productivity. In other words, conventional rules of thumb are substituted by accurate procedures developed after careful study of an individual at work. Universal approaches of Scientific management are developed for Efficiency of workers, Standardization of job roles/activities and Discipline - the role of managers and the business hierarchy. Taylor's Scientific Management: Frederick Taylor is known as the father of Scientific Management and he published Principals of Scientific Management in which he proposed work methods designed to boost worker productivity. Taylor asserted that to succeed in these principles, it is necessary to transform completely the part of management and labour. (ii) Administrative Management: Administrative Management emphasizes the manager and the functions of management. The main objective of Administrative management is to describe the management process and philosophy of management. In contradiction of scientific management, which deals mainly with jobs and work at individual level of scrutiny, administrative management gives a more universal theory of management. Henry Fayol's Administrative Management (1841–1925): His five function of managers were plan, organize, command, co-ordinate, and control. Principal of administrative management: 1.Division of labour, 2.Authority & responsibility, 3.Discipline, 4.Unity of command, 5.Unity of direction, 6.Subordination of individual interests to general interest, 7.Remuneration of personnel, 8.Centralization, 9.Scalar chain, 10.Order, 11.Equity, 12.Stability of tenure, 13.Initiative and14.Esprit de corps (union of strength). These 14 principles of management serve as general guidelines to the management process and management practice. The Neo-Classical approach Human Relations Approach: The human rationalists which is also denotes to neo-classicists, focused as human aspect of business. These theorists emphasize that organization is a social system and the human factor is the most vital element within it. There are numerous basic principles of the human relations approach that are mentioned below: 1. Decentralization: The concept of hierarchy employed by classical management theorists is replaced with the idea that individual workers and functional areas (i.e., departments) should be given greater autonomy and decision-making power. This needs greater emphasis on lateral communication so that coordination of efforts and resources can occur. This communication occurs via informal communication channels rather than the formal, hierarchical ones. 2. Participatory Decision-Making: Decision-making is participatory in the sense that those making decisions on a day-to-day basis include line workers not normally considered to be "management." The greater sovereignty afforded individual employees and the subsequent reduction in "height" and increase in span of control of the organizational structure requires that they have the knowledge and ability to make their own decisions and the communication skill to coordinate their efforts with others without a nearby supervisor. 3. Concern for Developing Self-Motivated Employees: The importance on a system of decentralized and autonomous decision-making by members of the organization necessitates that those members be extremely "self- motivated". Goal of managers in such an organization is to design and implement organizational structures that reward such self-motivation and autonomy. The human relationists, advocates the several factors after conducting Hawthorne experiments which are mentioned below. 1. Social system: The organization in general is a social system consists of numerous interacting parts. The social system established individual roles and establishes norms that may differ from those of formal organization. 2. Social environment: The social climate of the job affects the workers and is also affected. 3. Informal organization: The informal organization does also exist within the frame work of formal organization and it affects and is affected by the formal organization. 4. Group dynamics: At the place of work, the workers often do not act or react as individuals but as members of group. The group plays an important role in determining the attitudes and performance of individual workers. 5. Informal leader: There is an appearance of informal leadership as against formal leadership and the informal leader sets and enforces group norms.  6. Non-economic reward: Money is an encouraging element but not the only motivator of human behaviour. Man is diversely motivated and socio psychological factors act as important motivators. Modern Management thought Contingency Approach: The contingency approach is associated with applying management principles and processes as dictated by the sole characteristics of each situation. It depends on various situational factors, such as the external environment, technology, organizational characteristics, characteristics of the manager, and characteristics of the subordinates. Contingency theorists often implicitly or explicitly disapprove the classical approach as it focuses on the universality of management principles. Systems Approach Of Management Thought The systems approach deals with the thoroughly understanding the organization as an open system that converts inputs into outputs. The systems approach has great impact on management thought in the 1960s. During this period, thinking about managing practices allowed managers to relate different specialties and parts of the company to one another, as well as to external environmental factors. The system approach focuses on the organization as a whole, its communication with the environment, and its need to achieve equilibrium. System approach To summarize, there are important theories of Management and each theory has distinct role to knowledge of what managers do. Management is an interdisciplinary and global field that has been developed in parts over the years. Q16. Is management a profession? Give arguments Ans. A profession may be defined as an occupation that requires specialized knowledge and intensive academic preparations to which entry is regulated by a representative body. The essentials of a profession are: 1. Specialized Knowledge - A profession must have a systematic body of knowledge that can be used for development of professionals. Every professional must make deliberate efforts to acquire expertise in the principles and techniques. Similarly a manager must have devotion and involvement to acquire expertise in the science of management. 2. Formal Education & Training - There are no. of institutes and universities to impart education & training for a profession. No one can practice a profession without going through a prescribed course. Many institutes of management have been set up for imparting education and training. For example, a CA cannot audit the A/C‟s unless he has acquired a degree or diploma for the same but no minimum qualifications and a course of study has been prescribed for managers by law. For example, MBA may be preferred but not necessary. 3. Social Obligations - Profession is a source of livelihood but professionals are primarily motivated by the desire to serve the society. Their actions are influenced by social norms and values. Similarly a manager is responsible not only to its owners but also to the society and therefore he is expected to provide quality goods at reasonable prices to the society. 4. Code of Conduct - Members of a profession have to abide by a code of conduct which contains certain rules and regulations, norms of honesty, integrity and special ethics. A code of conduct is enforced by a representative association to ensure self discipline among its members. Any member violating the code of conduct can be punished and his membership can be withdrawn. The AIMA has prescribed a code of conduct for managers but it has no right to take legal action against any manager who violates it. 5. Representative Association - For the regulation of profession, existance of a representative body is a must. For example, an institute of Charted Accountants of India establishes and administers standards of competence for the auditors but the AIMA however does not have any statuary powers to regulate the activities of managers. From above discussion, it is quite clear that management fulfills several essentials of a profession, even then it is not a full fledged profession because: - a. It does not restrict the entry in managerial jobs for account of one standard or other. b. No minimum qualifications have been prescribed for managers. c. No management association has the authority to grant a certificate of practice to various managers. d. All managers are supposed to abide by the code formulated by AIMA, e. Competent education and training facilities do not exist. f. Managers are responsible to many groups such as shareholders, employees and society. A regulatory code may curtail their freedom. g. Managers are known by their performance and not mere degrees. h. The ultimate goal of business is to maximize profit and not social welfare. That is why Haymes has rightly remarked, “The slogan for management is becoming - ‟He who serves best, also profits most‟.”