Business Studies Class XII Created By: Anmol Malik

9782001542

Chapter 1: Nature and Significance of Management

What is Management?

Management is defined as a process of getting things done by others with the aim
of achieving goals effectively and efficiently.

 It’s a process
 Work done by others
 Effectively: Work should be done within the planned time
 Efficiently: Doing the work correctly at a minimum possible cost.

Function of Management process: What does management do?

1. Planning: It’s about deciding the plan of action in advance about future. It’s
about identifying the objectives. Planning is only prediction may not
necessarily be the reality.
What? When? How?
2. Organizing: It’s about arranging the required things to meet the pre-
determined goals. Identifying the roles..
3. Staffing: After identifying what is to be done, and who will do what. Hiring
the right skill at the right position.
4. Directing: Leading and motivating the people. Setting right environment and
correct spirit in order to meet goals.
5. Controlling: It’s about looking back and check if all what was decided is
actually happening.

Features of management:

1. Goal oriented process: It’s has a goal oriented approach of fulfilling the pre-
determined objectives.
Ex: If the objective of JIO is to add 1 million users in 2019, then all
managerial activities would be directed towards achieving this goal.
2. Management is all pervasive: It’s required everywhere & is present
everywhere.

Business Studies Class XII Created By Anmol Malik

Business Studies Class XII Created By: Anmol Malik
9782001542

Ex: A house wife manages her family, a CEO manages his/her business
organization, Principal manages his/her school etc..
3. Multi-dimensional: It’s about managing every stage. It’s about managing
the work, people and operation.
4. Continuous process: Management is an ongoing process. All the function
of managements i.e. Planning, Staffing, Organizing, Directing and
Controlling are performed by the managers on a continuous basis.
5. Group activity: Management is not performed by a single person in fact it is
the coordinated efforts of a group of people.
6. Dynamic function: An organization interacts with its external environment
on a daily basis, resulting in regular change to survive and grow.
Ex: Indian Company sells its products to various countries. It cannot quote
the same price for to each country due to different expectations and demand.
7. Intangible: You can only feel in not see it. Management cannot be seen but
it can be felt when targets are met and employees are happy.

Objectives of Management:

What are objectives?

“Objectives are the goal towards which the activities are directed.”

1. Organization Objectives:
a. Survival: Enough revenue to cover costs
b. Profit: It is important for covering costs and risks of the business.
c. Growth: Finally every organization wants to grow in terms of sales
revenue and number of employees.
2. Social Objectives: It involves the creation of benefit for society.
Organizations take everything from society; in terms of resources and finally
give product back to society. So Organizations use environmental friendly
methods of production, giving employment opportunities to people and
many more..
This help in creating Goodwill..
3. Personal objectives: Targeting the employee benefits, satisfying the
personnel’s, people working..

Business Studies Class XII Created By Anmol Malik

Business Studies Class XII Created By: Anmol Malik
9782001542

Ex: Filling in vacancies internally by providing opportunities to its staff.

Importance of Management:

1. Management helps in achieving the organization goals:

It integrates all individual efforts in achieving organizational goals
2. Provides efficiency: It increases productivity through better planning,
organizing, directing the activities of an organization.
3. Creates dynamic environment: Management helps in the survival of an
organization as managers always prepare to adapt and change according to
the external environment.
4. Helps in achieving personal objectives: Through motivation and leadership,
management helps in achieving the personal objective.
5. Development of society
6. Brings harmony to work.

Management as a Science, Art & Profession

It’s both Science and Art. It’s a combination of both..

Management is a Science:

a. Systematic body of language: It’s already defined and we study what is

stated in it like a science language.
b. Principles are based on repeated experiment: Its tested, and proven after
applying it multiple times.

Management is an Art:

a. Existence of theoretical knowledge

b. Personalized application
c. Based on practice and creative.

Management as a profession.. In current world it’s pursued as a career through

professional courses
Business Studies Class XII Created By Anmol Malik
Business Studies Class XII Created By: Anmol Malik
9782001542

Levels of Management:

(A) TOP LEVEL  This level of management consists of the senior most
MANAGEMENT executive level of an organization.
 Their chief task is to lay down overall goals, policies and
strategies for the organization and to communicate with the
middle level of management.
Following are the main designations assigned to individuals working
at this level:

 Managing Director.
 Board of Directors.
 Chairperson.
 Chief Executive Officers.
 Chief Product Officers.
 Chief Technology officers.
Functions performed at TOP LEVEL OF MANAGEMENT are :

 Making strategies and goals of the organization.

 Taking decisions regarding activities to be performed.
 Framing policies for the organization.
 Responsible for Welfare and survival of the organization.

(B) MIDDLE LEVEL  This level of management consists of executives working

MANAGEMENT between top level and supervisory level.
 They interpret and implement the policies, coordinate all
activities, ensure availability of resources and implementation
of policies framed by top level management.
They consist of:

 Divisional Heads and Sub-divisional Heads.

 Departmental Heads like Purchase Manager, Sales Manager,
Finance Manager, Personnel Manager etc.
 Plant Superintendent.

Business Studies Class XII Created By Anmol Malik

Business Studies Class XII Created By: Anmol Malik
9782001542

Functions performed at MIDDLE LEVEL OF MANAGEMENT are

:

 Interpret the policies to lower management.

 Taking decisions regarding a number of personnel in the
department.
 Assigning duties and responsibilities to employees in their
department.
 Convey suggestions and grievances of the supervisory level to
the top level for the overall smooth functioning of the
organisation.
 Liable for the ultimate production of respective departments.
 To act as a link between lower and management.

(C) LOWER LEVEL Supervisory / Lower / Operational Level Management

MANAGEMENT
 This level of management operates between middle-level
management and operative workforce.
This level consists of-

 Supervisors.
 Foremen.
 Inspectors.
Functions performed at LOWER LEVEL OF MANAGEMENT are :

 Provide on the job training to the workers.

 Ensure the performance of the workers.
 Giving feedback to the workers.
 Influence others to work more by setting an example.
 Responsible for group unity.
 Act as a link between the management and the workers.

Business Studies Class XII Created By Anmol Malik

Business Studies Class XII Created By: Anmol Malik
9782001542

COORDINATION (Characteristics and importance)

Co-ordination is bringing together the activities and resources of organization and

bringing harmony in them. It’s is an essence of management.

Characteristics of Co-ordination:

1. Integrated group efforts

2. Ensures unity of efforts
3. Continuous process
4. Its pervasive function: its required everywhere
5. Responsibility of managers.
6. A delicate function: it’s a very sensitive so need extra care every time..
7. No overlapping

Importance of Co-Ordination

1. Growth in Size: When there is a growth in size, the number of people

employed by the organization also increases. Hence to integrate the efforts
Coordination is important as all are needed to work towards the common
goal of the organization.
2. Functional Differentiation: In an organization there are separate
department and different goals. The process of linking those activities is
achieved by Co-Ordination.
3. Specialization: Modern organizations are characterized by a high degree of
specialization. Co-ordination is required among different specialist for
smooth functioning of organization.
_____________________________________________________________

Important theoretical questions:

1. Explain the meaning of Efficiency and effectiveness?
2. Discuss the objectives of management?
3. Describe the importance of management?
4. Examine the nature of management as a science, art and profession.
Business Studies Class XII Created By Anmol Malik
Business Studies Class XII Created By: Anmol Malik
9782001542

5. Explain the role of top, middle and lower level of management?

6. Explain the function of management?
7. Discuss the concept and characteristics of Coordination?
8. Explain the importance of coordination?

Business Studies Class XII Created By Anmol Malik