CBSE – XII

BUSINESS STUDIES, CH.7

By Henna Punjabi
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DIRECTING
Supervision

Motivation

Leadership

Communication

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WHAT IS DIRECTING ?

Directing is concerned with instructing, guiding, inspiring

and motivating the employees in the organisation so that
their efforts result in achievement of organisational goal.

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WHAT IS DIRECTING ?
• Directing is telling people what to do and seeing that they do it
to the best of their ability.
- Ernest Dale
• Direction is a complex function that includes all those activities
which are designed to encourage subordinates to work
effectively and efficiently.
- Koontz and O’Donnell
• Directing deals with the steps a manager takes to get
subordinates and others to carry out plans.
- William Newman
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FEATURES OF DIRECTING

1. Directing initiates chain

2. Continuing function
3. Directing takes place at every level
4. Directing flows from top to bottom
5. Performance oriented
6. Human element

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IMPORTANCE OF DIRECTING

1. To initiate action
2. To integrate employees’ efforts
3. Means of motivation
4. Bring stability and balance in the
organisation
5. To facilitate change

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PRINCIPLES OF DIRECTING

1. Maximum individual contribution

2. Harmony of objectives
3. Unity of Command
4. Appropriateness of direction technique
5. Managerial communication
6. Use of informal organisation
7. Leadership
8. Follow through
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ELEMENTS OF DIRECTING
• Supervision
• Motivation
• Leadership
• Communication

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SUPERVISION

• Instructing
• Guiding
• Monitoring
• Observing

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MOTIVATION
• Motivation is the process of stimulating, inspiring and inducing the
employees to perform to their best capacity.

• Motivation is a process of inducing people to perform to their best

ability to accomplish the goal.

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ELEMENTS OF MOTIVATION

• Motive
• Motivation
• Motivators

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CHARACTERISTICS OF
MOTIVATION
1. It is a psychological phenomenon
2. Produces goal directed behavior
3. Positive as well as negative
4. Complex process

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MASLOW’S HIERARCHY OF NEED

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ASSUMPTIONS
• Behavior can be changed by fulfilling needs
• Starting with basic needs
• Only next higher level needs can motivate
• One moves higher only after satisfaction of one level
of need

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INCENTIVES
Financial Incentives Non-financial incentives

Pay and allowances Status

Profit Sharing Organisational Climate

Co-partnership Career Advancement

Bonus Job enrichment

Commission Recognition

Retirement Benefit Job security

Wage incentives Participation

Perks /Fringe benefits Employee empowerment

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MONETARY BENEFITS

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PAY & ALLOWANCES

• Allowance means an amount paid to employees as part of
their salary package, or to cover their out of pocket
expenses incurred on behalf of the firm. E.g. Travelling allowance,
food, phone bill, etc.

• Pay or Salary hike or Pay raise is an increment in salary every year.

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PROFIT SHARING

100% Chart Title • A percentage of profit is fixed, beyond

90% which if profit exceeds, it is shared
80%
70%
with employees.
60%
50%
• Profit sharing refers to various
40% incentive plans introduced by
businesses that provide direct or
30%
20%
10%
0%
indirect payments to employees that
Category 1
depend on company's profitability in
Series 1 Series 2 Series 3
addition to employees' regular salary
and bonuses.
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CO-PARTNERSHIP / STOCK
OPTION
• Employee Stock Ownership Plans (ESOPs)
• Issue of shares lower than market price
• Participation in management
• Establishing industrial democracy and
boosting the morale of employees.

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BONUS
• One time extra reward offered to employees as a reward for good
performance

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COMMISSION

• Common incentive given to sales force

• Income is directly related to efforts / performance
• Higher the orders, higher is the commission

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PRODUCTIVITY LINKED WITH

WAGE INCENTIVES
• Differential piece rate wage system

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RETIREMENT BENEFITS
• Pension :
• Provident Fund :
• Gratuity:

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PERKS / FRINGE BENEFITS /

PERQUISITES
• Perks : Common perks are take-home vehicles, hotel stays, free refreshments,
leisure activities on work time (golf, etc.), stationery,
• Fringe benefits : The most common benefits include life, disability, and 
health insurance bundles; tuition reimbursement or education assistance;
fitness center access or discounts; employee meals and cafeteria plans; 
• Perquisites : Rent, Insurance, access to amenities

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NON-MONETARY BENEFIT
• Status
• Organisational climate
• Career advancement
• Job-enrichment
• Employees’ recognition
• Job security
• Employees’ participation
• Autonomy / employee empowerment
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LEADERSHIP

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LEADERSHIP
• Leadership is a process of influencing the behavior of people
at work towards the achievement of specified goal. The
following elements must be present in the leadership.
- Process of influence
- Common goal
- 2 or more people
- Gain willing co-operation of employees

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FEATURES OF LEADERSHIP
• Ability to influence others
• Bring change in behavior
• Shows interpersonal relationship between leader
and follower
• To achieve common goal
• Continuous process

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TYPES OF LEADERS

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AUTOCRATIC LEADERSHIP

FEATURES SUITABILITY
• Bossy • Uneducated and unskilled subordinates
• Controlling • Fear and punishment
• Takes decisions by himself • Dominant decision making
• No delegation of authority
• Gives orders and expects others to follow
• Rewards / penalty
• Less desirable
• Ex. Adolf Hitler

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AUTOCRATIC LEADERSHIP
ADVANTAGES DISADVANTAGES
• Quick decision-making • Frustration and low morale of
• Motivates and satisfies leaders subordinates
• Good for less competent subordinates • Lack of initiative among
subordinates
• When speed is required
• Unutilised potential
• No development of subordinates

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DEMOCRATIC LEADERSHIP

FEATURES SUITABILITY
• Consultation and participation • Job satisfaction is the goal
• Delegates and decentralises • Leader wants to share decision-making
• Freedom of expression • Sub-ordinates have accepted goals
• Listens to suggestions

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DEMOCRATIC LEADERSHIP
ADVANTAGES DISADVANTAGES
• Improves job satisfaction and morale • Time-consuming
• Improves decision making • Minimal interaction of subordinates
• Develops positive attitude • Passing responsibility to sub-
• Reduces labour turnover and absenteeism ordinates
• Quality decisions • Sign of incompetence
• Overall growth of abilities
• Narayan Murthy of Infosys Technologies

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LAISSEZ FAIRE LEADERSHIP

FEATURES SUITABILITY
• Complete delegation • Well-trained sub-ordinates
• Leader avoids power • Self-motivated sub-ordinates
• Brings necessary resources • Responsible sub-ordinates

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LAISSEZ FAIRE LEADERSHIP

ADVANTAGES DISADVANTAGES
• Positive effect • No guidance to sub-ordinates
• Scope of development for employees • Ignores contribution of leader
• Utilisation of employee potential • Chaos from sub-ordinate

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COMMUNICATION

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COMMUNICATION
• Communication can be defined as transmission or exchange
of ideas, views, message, information or instructions
between two or more persons by different means.
• - spoken words
• - written words
• - body language and gestures
• - Diagrams, graphs, signs, etc.

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COMMUNICATION PROCESS

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FORMAL AND INFORMAL

COMMUNICATION

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Types of
communication

Formal Informal

Vertical Horizontal Diagonal Grapevine

Upward

Downward

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FORMAL COMMUNICATION

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INFORMAL COMMUNICATION

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BARRIERS TO COMMUNICATION

(A) SEMANTIC BARRIERS

(B) PSYCHOLOGICAL BARRIERS
(C) ORGANISATIONAL BARRIERS
(D) PERSONAL BARRIERS

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SEMANTIC BARRIERS
1. Badly expressed message
2. Symbols with different meanings (weight, wait) cell
3. Faulty translations
4. Unclarified assumptions
5. Technical jargon
6. Body language and gesture decoding

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PSYCHOLOGICAL BARRIERS
1. Premature evaluation
2. Lack of attention
3. Loss by transmission and poor retention
4. Distrust

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ORGANISATIONAL BARRIERS
1. Organisational policy
2. Rules and regulations
3. Status difference
4. Complex organisation
5. Organisational facilities

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PERSONAL BARRIERS
1. Lack of confidence of superior in his subordinates
2. Lack of incentives
3. Fear of authority
4. Unwillingness to communicate

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THANK YOU

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