Project for Business
Studies: Principles of
Management
Name: Srishti Kucheria
Class and section: XI – C
Roll No.: 12C33
Name of the school: Sir Mutha School
Subject: Business Studies
Acknowledgement
I would like to express my special thanks of
gratitude to my teacher Ms. Jayashree, who gave
me the opportunity to do this wonderful project,
for the Business Studies subject. I’m thankful for
her constant guidance throughout the project.
This project required a lot of research, and I came
to know about so many new things during my
research that broadened my knowledge.
Secondly, I would also like to thank my parents
and friends who helped me a lot in finalizing and
finishing this project within the limited time
frame.
Preface
This project has been made by my own effort and
I am pleased to submit this project work for
Business Studies in class 12. I am grateful towards
CBSE for introducing this project in Business
Studies. This project gives an insight into
Principles of management, its importance,
features, the 14 principles of Henry Fayol and the
principles of management introduced by Fredrick
Taylor. This project has enhanced my research,
interpretation, and knowledge with regard to the
given topic and also made my understanding
better about the principles of management
Index
Acknowledgement………………………………………
Preface…………………………………………………………
Introduction………………………………………………...
Index……………………………………………………………
The Need for Principles of Management..........
Nature of Principles of Management …………...
Substitute goods - advantage or
disadvantage?............................................................
Impact of Substitute Goods…………………………..
Different types of substitutability………………..
Indifference curve of Perfect Substitutes……..
Indifference curve of Imperfect Substitutes…
What is price? Why does it change?...................
Effect of Price change…………………………………..
Conclusion…………………………………………………...
Bibliography………………………………………………..
Introduction
Management is the process of planning,
organising, staffing, directing and controllingthe
enterprise resources efficiently and effectively for
achieving the organisational goals.
Management is guided by the principles of
management.
A principle is a fundamental statement of truth
that provides guidance to thought and action.It
forms the guideline for taking managerial
decisions and behaviour.
Principles of Management are formed after
research in work situations, which are technical in
nature.
The need for Principles of
Management
The reasons for the need for Priniples of
Management are stated below;
1. Providing managers with useful insights into
reality:
Management principles guide managers to take
right decisions at the right time by improvingtheir
knowledge, ability and understanding of the
various managerial situations and circumstances
and also help the managers to learn for the past
mistakes of the previous managers.
2. Optimum utilisation of Resources and
effective Administration:
Management Principles facilitate optimum use
of resources by coordinating the physical,
financial and human resources.
They also help in better Administration by
discouraging personal prejudices and adopting
an objective approach.
3. Scientific Decisions:
Management helps in thoughtful decision making
by emphasising on logic rather than blind faith.
Decisions based on management principles tend
to be more realistic, justifiable, balanced and free
from prejudice.
4. Meeting the requirements of the changing
environment:
Although these principles are general guidelines,
they are modified timely to meet the changing
requirements the dynamic business environment.
Management Principles provide and effective
leadership and help the organisation to
implement the changes.
5. Fulfilling Social Responsibility:
An organisation not only needs to achieve their
goals but also needs fulfill its social
responsibilities. Management of priciples have
evolved in response to these demands and help
the business enterprise to achieve both
objectives.
6. Management Training, Education and
Research:
Management Principles are helpful in identifying
the areas in which existing and future managers
should be trained. These principles lay the
foundation of many management courses at the
undergraduate and post graduate level.They also
provide the basis for future research.
Nature of Principles of
Management
1. Universal Applicability: It can be applied in all
types of organisations.
2. General guidelines: These are general
guidelines for making decision and taking
action. However, they do not provide any
ready-made solutions.
3. Formed by practice and Experimentation:
they are developed after thorough reasearch
work on the basis of the experiences of the
managers.
4. Flexible: It can be adopted and modified by
the practicing managers as per the demands
of the situation.
5. Mainly Behavioural: Since the principles aim
at influencing complex human behaviour,
they are behavioural in nature.
6. Cause and Effect relationship: they intend to
establisha relationship between cause and
effect so that they can be used in suitable
situations.
7. Contingent: Their applicability depends upon
the prevailing situation at the particular point
of time.
About Henry Fayol
Henry Fayol (1841-1925) got a degree in mining
engineering and joined French Mining Company
in 1860 as an engineer.
He founded the ining company, ‘Cmpagnie de
Commentary- Fourchambeau- Decaziville’ and
became its Managing director in 1888. When the
Company was on the verge of bankruptcy, he
accepted the challenge and by using rich and
broad administrative experience, he turned the
fortune of his company.
His contributions maily include the 14
Management principles. For his contributions, He
is well known as the “Father of General
Management”
Fayol’s 14 Principles of
Management
1. Division of work:
Work is divided in small tasks or jobs and each
work is done by a trained specialist which
leads to greater efficiency, specialisation,
increased productivity and reduction of
unnecessary wastage and movements.
2. Authority and Responsibility:
Authority means the power take decisions
and responsibility refers to the obligation to
complete the given task timely. Authority and
responsibility should go hand in hand.
3. Discipline: It is the obedience of the
organisational rules by the employees and
workers. Discipline requires good supervisors
at al levels , clear and fair agreements and
judicious application of penalities.
4. Unity of Command:
It implies that evry worker should receive orders
from one superior only, otherwise it will create
confusion, conflict, disturbance and overlapping
of activities.
5. Unity of Direction:
Each group of activities having the same
objectives must have the one head and one
plan to ensure unity of direction, action and
coordination.
6. Subordination of Individual interest to
General interest:
The interest of an organisationshould take
priority over the interest of any one individual
employee or worker.
7. Remuneration of Employees: the overall pay
and compensation should be fair to both, the
employees as well as the organisation. The
wages should encourage the worker to do
better work.
8. Centralisation and Decentralisation:
centralisation means the concentration of
decision making authority in few hands at the
top level. Decentralisation means the even
distribution of power at every level of
management. There should be a balance
between both because an organisation can
not be completely centralised or
decentralised.
9. Scalar chain: The formal lines of authority
between the superior and the subordinates
from the highest to the lowest ranks is known
as the scalar chain. This chain should not be
violated but in case of emergency, employees
at the same leve can contact through the gang
plank.
10. Order:
A place for everyone and everything and
everyone and everything should be in it
respective place. People and materials must
be in suitable places at appropriate times for
maximum efficiency.
11. Equity:
The working environment of any organisation
should be free from all forms of dicrimination.
Principles of justice and ‘fair play’ should be
followed. No worker shoud be unduly
favoured or punished.
12. Stability of Personnel:
When a candidate is selected after rigorous
procedure, the selected person should be
kept at the appointed position for a minimum
decided period of time for him/her to be able
to show results.
13. Initiative:
Initiative means taking the first step with self-
motivation. Workers should be encouraged and
motivated to develop their own plans for
improvement and then implement those plans.
14. Espirit de Corps:
Management should promote team spirit,
unity and harmony among employees.
Management should promote team work.
Taylor’s Principles of
Scientific Management
1. Science, Not Rule of Thumb:
Managers make decisions based on their
judgments as a rule of thumb. This principle
suggests that even minor industrial activities may
be organised appropriately. Decisions must be
based on scientific research that includes cause
and effect linkages.
2. Harmony, Not Discord:
Taylor underlined the need for total harmony
between staff and management. Any dispute
between them harms either the employees or the
management. Both management and employees
must recognize the value of the other.
3. Cooperation, Not Individualism:
This idea, which is an outgrowth of the concept of
‘Harmony, not Discord,’ emphasises cooperation,
mutual trust, and a spirit of generosity among
managers and employees. The goal is to replace
internal rivalry with collaboration.
4. Development of every person to his/her
greatest efficiency and prosperity:
It implies development of all persons of an
organization after their scientific selection
and assignment of work suited to their
temperament and abilities.
About Fredrick Winslow
Taylor
F.W. Taylor or Fredrick Winslow Taylor (1856-
1915), who rose from ranks of an ordinary
apprentice to chief engineer in Midvale Steel
Company, U.S.A.
Taylor proved with his practical theories that a
scientific method can be implemented to
management. Taylor gave much concentration on
the supervisory level of management and
performance of managers and workers at an
operational level. For his contributions, he is well
known as the ‘Father of scientific management’.
Scientific Management attempts to eliminate
wastes to ensure maximum production at
minimum costs.
Taylor’s techniques for
Scientific Management
1. Functional Foremanship: This is a technique in
which, planning and execution are separated.
This based on specialosation. There are 8
types of specialised professionals, four each
under planning and execution.
2. Standardisation and simplification of work: It
results in savings of cost of labour, amchines
and tools. It leads to fuller utilisation of
resources.
3. Method Study: The objective is to find one
best way doing the job to maximise efficiency
in the use of resources.
4. Motion Study: It is the science of eliminating
wastefulness resulting from using
unnecessary, ill-directed and inefficient
motions by the workers or the machines.
5. Time Study: It determines the standard time
take to perform a well-defined job.
6. Fatigue Study: This seeks to determine the
time and frequency of rest intervals in
completing a task.
7. Differential piece wage system: This links
wages and productivity. The standard
outputper day is established nd two piece
rates are used – higer for those who achieve
upto or more than the standart output and
lower for those who achieve lower than the
standard output.
Case Study
-------------- Nilgiri’s--------------
Nilgiri’s is a local super market. It has a specific
place for all its resources and employees and try
to make everything easily accesible for the
customers as well as the staff. The employees are
all given their well-deserved salaries and the
probation period for freshers has recently been
decided as 6 moths.
Each employee is given their separate and distinct
job that is to be done at the store. It is ensured
that there is no overlapping of tasks. There are
some decisions the staff memebers can make by
themselves, while for some decisions the manager
needs to be consulted. However the chain of
command is not being followerd properly.
Their branch managers are responsible for guiding
and directing them and all the employees follow
the orders from their branch manager only. These
branch managers motivate the employees to
think of ideas and plans by themselves that they
can implement in the store. He also promotes
team spirit among them to improve the
relationship among employees. However, he is
not strict about the rules and regulations that are
to be followed. As a result, the staff members
take the rules of the stores for grated.
Upon asking one of the employees, it was found
out that an employee of theirs is being excused
for inappropriate behaviour in the organisation
without any reason.
With regard to Henry Fayol’s Principles of
Management;
This enterprise is implementing the following
principles very well:
• Order
• Remuneration to employees
• Stability of Personnel
• Division of work
• Centralisation and Decentralisation
• Unity of Direction
• Unity of Command
• Initiative
• Espirit de corps
However, this store can work on some other
principle to make their management more
effenctive and efficient. These principles are :
• Scalar Chain
• Discipline
• Equity
• Authority and Responsibilit
Conclusion
Principles of Management
Fayol’s principles
Taylor’s Scientific
Management
Principles Tecniques
Bibliography
Business Studies Textbook for Class 12
https://www.learnpick.in/prime/documents/ppts
/details/4332/ppt-for-class-xii-business-studies
https://unacademy.com/content/nta-ugc/study-
material/business-and-general-
awareness/principles-of-management/
