LESSON PLAN 1

Business Studies
XII : E,F,G

Topic – Nature & Significance of Management

Sub Topic- Concept, Features, objectives, Importance

Definition: It has been defined as a process of getting things done with the aim of achieving goals
effectively and efficiently.

PROCESS- Planning; organising; staffing; directing; controlling

Effectively – means finishing/completing the task, achieving goals

Efficiently – Doing the task correctly and with minimum cost; involves cost-benefit analysis (input output
relationship)
OUTPUT
Planning Organising Staffing
INPUT

Men; Money; Machine;

GOALS/END RESULT
Material; Method PROCESS

Directing Controlling

 Effectiveness and efficiency both are inter- related.

 For management it is important to be both efficient and effective.
 Both the aspect needs to be balanced.
 Completing a task at higher cost means that the firm is --------------- but not ------------------.

FEATURES OF MANAGEMENT:

1. Management is a goal oriented process- should be simple & clearly stated. Management unites
the efforts of different individuals in the organisation towards achieving these goals.
2. Management is pervasive- Activities involved in managing the enterprise are common to all the
organisations.
3. Management is multi dimensional- it is a complex activity having three dimensions
 Management of Work: Management translates the work of an organisation in terms of
goals to be achieved and assigns the means to achieve it.
 Management of People: It has two dimensions:
 Dealing with employees as individuals with diverse needs & behaviour
  Dealing with individuals as group of people

Task of management is to achieve the goals by making peoples strengths effective and their
weaknesses irrelevant.

 Management of operations: Every organisation has some basic product or service to

provide in order to survive. This requires a production process which entails flow of input
(material & technology) for transforming it into desired output for consumption.
4. Management is a continuous process- It is a series of continuous, composite but separate
functions.
5. Management is a group activity: An organisation is a collection of diverse individuals with different
needs. Team work & coordination is needed to achieve organisational goals and management
should enable all its members to grow & develop as needs & opportunities change.
6. Management is a dynamic function: has to adapt itself to the changing environment.
7. Management is intangible: cannot be seen but presence can be felt(targets met; employees happy
& satisfied; orderliness in organisation etc.)

OBJECTIVES OF MANAGEMENT

Organisational Social Personal

Survival Profit Growth

(Earn enough revenue (It is essential for covering (Business needs to add to its prospects.
to cover cost) cost & risks of the business) Its indicators are:
o increase sales volume
o increase in number of employees
o increase in number of products
o increase in capital investment etc.

Social objectives:

It involves creation of benefits for society. Social obligation refers to consistently creating
economic value for various constituents of society.

o Environmental friendly products

o Employment opportunities to disadvantaged section of society
o Providing basic amenities like schools & crèches to employees

Personal objectives:

To satisfy the diverse needs of individuals and reconcile personal goals with organisational
 objectives for harmony in the organisation.
o Financial needs- competitive salaries & perks
o Social needs- peer recognition
o Higher level needs- personal growth & development

IMPORTANCE OF MANAGEMENT

1. Helps in achieving group goals: To give common direction to individual effort in achieving
the overall goal of the organisation.
2. Increases efficiency: Aim is to reduce cost & increase efficiency
3. It creates a dynamic organisation: Help people to adopt to environmental change so that
the organisation is able to meet its competitive edge.
4. Helps in achieving personal objectives: Through motivation & leadership management
helps individuals to develop team spirit, cooperation & commitment to group success.
5. It helps in development of society- By providing good quality products & services; crete
employment opportunities; adopt new technology etc.

Assignment:

1. Mega Ltd. was manufacturing water-heaters, In the first year of its operations, the revenue
earned by the company was just sufficient to meet its costs. To increase the revenue, the company
analysed the reasons of less revenues. After analysis the company decided (i) to reduce the labour
cost by shifting the manufacturing unit to a backward area where labour was available at a very low
rate.
(ii) to start manufacturing solar waterheaters and reduce the production of electric water-heaters
slowly.
This will not only help in covering the risks, but also help in meeting other objectives too. Identify
and explain the objectives of management discussed above.

2.  Hero Ltd.’s target is to produce 20,000 shirts per month at a cost of Rs150 per shirt. The
Production Manager could achieve this target at a cost of Rs170 per shirt. Do you think the
Production Manager is ‘efficient’? Give reason in support of your answer. 

3. XYZ Power Ltd. set up a factory for manufacturing solar lanterns in a remote village as there was no
reliable supply of electricity in rural areas. The revenue earned by the company was sufficient to
cover the costs and the risks. The demand of lanterns was increasing day by day, so the company
decided to increase production to generate higher sales. For this they decided to employ people
from the nearby villages as very few job opportunities were available in that area. The company
also decided to open schools and creches for the children of its employees. Identify and explain the
objectives of management discussed above.