BUSINESS MANAGEMENT (B.

COM)
Module I- Concept of Management
Management
According to Lawrence A Appley "Management is getting things done
through the efforts of other people."
Features / Characteristics of management
 It is a process.
 It is a social process.
 Existence of objectives.
 Decision making
 It is dynamic.
 It is a group activity.
 It helps in time management.
 It is a career.
 It is a guidance.
 It is multidimensional.
 Integration of organisational resources.
 Leadership.
 It helps to achieve organisational objectives.
 It provides new ideas and imagination.
Nature and Scope of Management
Nature of Management Scope of management
Goal oriented Management principles
Human activity Financial management
Profession Personnel management
Art as well as science Materials management
Intangible Production management
Distinct process Marketing management
Management as science
Management is not an exact science like physics, chemistry etc. The
main reason of that is it deals with human being. Human behaviour
are unpredictable. The application of management principles does
not give same result.
Management as an art
Art is the application of personal skill in a particular situation to
achieve a desired result. The features of art are
 It involves acquisition of skill and ability.
 It is the application of personal skill.
 It aims to achieve concrete results.
 Continuous practice.
 It is creative.
On the basis of above fact, we can say that management is an art. It
is the art of getting things done through and with the help of others.
Management as a profession
Profession should possess the following characteristics:
 Existence of body of knowledge.
 Formalised method of acquiring training.
 Code of ethics.
 Service motto.
On the basis of above facts, we cannot fully recognise management
as a profession.
School of management thoughts
Classical Theory Neo classical Modern approach
approach
Increase productivity It is an attempt to Consider both micro
and efficiency improve classical and macro forces
theory. It argues impacting the
employee organisation in order
satisfaction as well to improve
as economic productivity.
effectiveness are the
goal of the
organisation.
This theory emphasis The organisation is a It is based on system
on rationality. social system. theory and
contingency theory.
The main content of This theory focused Managers use
this theory is more on structure quantitative analysis
 scientific and physical aspect and tools to solve
management, of worker. complex problems.
administration and
bureaucratic
management.
It was introduced in The main source of It is also called
the late 19th century. neo classical theory management science
are human relation approach.
movement and
behavioural
movement.
Levels of management and functions
Top level Medium level Lower level
Determine the Plan the department Plan for day to day
objective of the operations. works.
organisation.
Define the goal. Collect report from Motivates
lower level. employees
Establishes the policies. Evaluate performance of Issue instructions.
subordinates
Prepare strategic plans. Coordinating Allot works to
department activities. workers.
Judge the results. Cooperation and Give guidance to
coordination with other workers.
departments.
General principles of Management
1. Division of work
Work is divided into small jobs; it leads to specialisation and
efficiency.
2. Authority and responsibility
Authority is the right of superior to give orders. Responsibility is the
obligation to perform a duty.
3. Discipline
Discipline means sincerity, obedience and respect of rules and
regulations of the organisation.
4. Unity of command
Worker should receive orders from one superior only. It will reduce
confusion and conflicts.
5. Unity of direction
The entire organisation should be moving towards a common
objective in a common direction.
6. Subordination of individual interest to group interest
Importance should be given to interest of the organisation.
7. Remuneration
Remuneration should be fair and it should be satisfied by the
employees.
8. Centralisation and decentralisation
Centralisation means decision making power with the top
management. Decentralisation means powers are given to lower
level. An organisation should be strive to achieve balance between
centralisation and decentralisation.
9. Scalar chain
It is the line of authority. It is a chain of superior ranging from the
ultimate authority to the lower ranks.
10. Order
There should be material and social order in an organisation.
Arrangement of things is called material order. Arrangement of
people is called social order.
11. Equity
Equity results from kindliness and justice. Everybody should treated
as equal.
12. Stability of tenure and personnel
Frequent changes in the positions held by employees deteriorate
their standard of performance.
13. Initiative
Employees should be given adequate freedom to think and execute
their ideas.
14. Espirit de corps
It means union is strength. The entire organisation should be treated
as one unit
Scientific management
According to F.W. Taylor, “Scientific management means exactly
what you want meant to do and seeing that they do it in the best and
cheapest way.”
Features / Principles of scientific management
 Separation of planning and doing.
 Functional foremanship.
 Scientific work study.
 Scientific training and selection of workers.
 Financial incentives.
 Mental revolution.
Administration
According to Haimann “Administration means overall determination
of policies, setting of major objectives, the identification of general
purposes and lying down of broad programs and projects.”
Difference between management and administration
Management Administration
It is a middle level activity. It is a top level activity.
It is an executive function. It is a determinative function.
It is used mainly in business It is mainly used in government
organisation. organisations.
It is a doing process It is a thinking process.
Decisions are influenced by Decisions are influenced by
values and beliefs. public opinion.
Key person is manager Key person is administrator
MBO (Management by Objectives)
It is a managerial system that aims to improve organisational
performance by clearly defining the objectives.
Features of MBO
 Focused on goals and achievement.
 It gives emphasis on effective performance.
 Periodic review of performance.
 Universally applicable.
 It provides guidelines for appropriate systems, procedure etc…
Benefits of MBO
 Subordinates participate and cooperate in setting goals.
 Systematic evaluation of the performance.
 It provides definite performance standards.
 Delegation of authority is done.
 It is a tool for organisation control.
 It encourages motivation.
 It envisages planning.
 Periodic review of performance.
Weakness or Limitations of MBO
 It is a time-consuming process.
 It is costly.
 Difficult in setting objectives.
 It creates frustration among managers.
 More emphasis on short term objectives.
Process of MBO
 Setting of objectives.
 Development of action plans.
 Periodic review.
 Performance appraisal.
Workers Participative Management (WPM)
It means participation of non-managerial employees in the decision
making process of the organisation.
Objectives of WPM
 To establish industrial democracy.
 To build dynamic human resources.
 To strengthen labour management cooperation.
 To promote increased productivity.
Merits and demerits of participative management
Merits of WPM Demerits of WPM
Increased productivity Decision making slows down
Job satisfaction Security issues
Motivation Time consuming
Improved quality
 Reduced cost
Attain self esteem
Forms of WPM
 Collective bargaining
 Suggestion scheme
 Workers council
 Workers committee
 Joint decision model
 TQM
 Quality circle
Management by Exception (MBE)
It is an employee empowerment and management style where in
managers intervene only when their employees fail to meet their
performance standard.
Management by Motivation (MBM)
MBM is the process through which managers encourages employees
to be productive and effective.
Intrinsic motivation Extrinsic motivation
Intrinsic motivation refers to Extrinsic motivation refers to
individuals engaging in activities individuals engaging in activities
or tasks purely for the sake of or tasks due to factors which are
personal interest or enjoyment. external to them.
Methods for motivating employees
 Rewards and incentives
 2.Non-monetary incentives
 Job security
 Promotion
 Challenging jobs
 Suggestion scheme
 Recognition
Functions / Process of management
PODSCORB
 Planning
 Organising
 Directing
 Staffing
 Coordinating
 Reporting
 Budgeting
Planning
According to Haimann "Planning means deciding in advance. What is
to be done."
Features of planning
 It is done on the basis of objectives.
 It is futuristic.
 It is a mental activity.
 It is the primary function of management.
 It is a continuous process.
 It is dynamic.
 It is pervasive.
 It should be flexible.
Planning process/ Steps
 Determination of objectives.
 Construction of planning premises.
 Collection and classification of information.
 Identification of alternatives.
 Evaluation of alternatives.
 Selection of best alternative.
 Preparation of subsidiary plan.
 Implementation.
Advantages of planning
 It helps in achieving objectives.
 It helps in coordination.
 It offset uncertainty.
 It facilitate co-ordination.
 It helps in control.
 It helps in motivation.
 It enhances efficiency.
Limitations of planning
 It is expensive.
 It is time consuming.
 Limitations of forecasting.
 False sense of security.
 Technological changes.
Barriers of effective planning
 Uncertainty
 Technical problems
 Psychological problems
 Lack of knowledge in forecasting techniques.
 Substandard information.
 Reluctance of managers.
 Lack of appropriate planning climate.
Elements or Types of plans
1. Objectives
Objectives are the goals of the organization wish to achieve varying
over a period of time.
2. Policies
A policy is a standing plan. It guides management in all levels in
decision making.
3. Procedures
Procedures are operational guides to action.
4. Rules
It is a specific action to be taken or not to be taken with respect to a
situation.
5. Strategies
It is a plan made in the light of plans of competitors
6. Programmes
It is a sequence of action to accomplish objectives.
7. Budgets
It is a statement of expected results expressed in quantitative terms
for a definite period of time.
Planning premises
It means all the assumption about future.
Organising
Organising is a managerial function of arranging people and
resources to work towards a goal.
Steps / Elements / Functions of organising
 Defining objectives.
 Determining activities.
 Grouping of activities.
 Assigning duties.
 Delegation of authorities.
 Coordinating activities.
 Provision of physical facilities and good environment
 Establishment of structural relationship.
Principles of organisation
 Principle of organisation
 Division of labour.
 Scalar chain
 Unity of command
 Unity of direction
 Span of control
 Flexibility
 Delegation of authority.
Formal organisation
It is a type of organisation which is created by top management to
achieve objectives in this structure, authority, responsibility and
accountability are well defined.
Informal organisation
It is a type of organisation which is created through personal
relationship in the organisation.
Difference between formal and informal organisation
Formal organisation Informal organisation
It is based on formal relationship It is based on interpersonal
relationship.
The structure is well defined The structure is not well defined.
 It is created by top It is created by personal
management. relationship.
It has a long life. It does not last long.
Official communication. Unofficial communication.
It is governed by specific rules There is no specific rules and
and regulations. regulations.
It is fairly large. It is small.
Types of organisation structure
1. Line organisation
This is the simplest type of organisation. Under this type of
organisation, line of authority flows vertically from top most
executive to lowest subordinates.
Merits and demerits of line organisation
Merits of line organisation Demerits of line organisation
Simple Lack of specialisation
Quick decision Overloading of work
Unity of command Difficult communication
Discipline Difficult coordination
Economical Not suitable for large business.
2. Line and staff organisation
It is a combination of line and staff officers. The line function directly
responsible for achieving organisational objectives. The staff function
supports line in achieving organisational objectives.
Merits and demerits of line and staff organisation
Merits of line& staff Demerits of line and staff
Sound managerial decisions. Conflicts
Flexibility Confusion about position
Unity of command Lack of accountability
Reduction of burden Increased cost administration
Planned specialisation Chance of misinterpretation.
Difference between line and line & staff organisation
Line organisation Line and staff organisation
Expert advice are not available. Expert advice are available.
There is strict discipline. There is loose discipline.
It is less elastic. It is more elastic.
 IT is less expensive. It is expensive.
It not based on specialisation. It is based on specialisation.
3. Functional Organisation
This is an organisation structure in which employees are arranged by
functions performed by them in the organisation.
Merits and demerits of functional organisation
Merits functional organisation Demerit functional organization
Specialization Conflicts
Standardisation Lack of coordination
Higher efficiency Delay in decision making
Mass production Violation of unity of command
Flexibility Complex relationship.
Difference between line organisation and functional organisation
Line organisation Functional organisation
Authority flows from top to Authority is functional.
bottom.
Direct chain of command. No direct chain of command.
No specialisation Specialization
Strict discipline. Loose discipline
Better coordination. Difficult to attain coordination.
Suitable to small business. Suitable to large business.
Span of management
It refers to number of subordinates who can be managed effectively
by a superior. It is also called span of control.
Factors determining span of control
 Capacity of superior.
 Capacity of subordinates.
 Nature of work.
 Degree of decentralisation.
 Availability of staff assistance.
 Communication techniques
Delegation of authority
It means granting of authority to subordinates to operate within
prescribed limits.
Steps in delegation of authority
 Determination of responsibility.
 Delegation of authority.
 Creation of accountability.
Principles of delegation
 Principles of delegations by results expected.
 Unity of command.
 Authority.
 Scalar chain
 Communication.
 Principle of functional definition.
Importance / Advantages of delegation
 Quick decision
 Reduces burden of superiors.
 Better coordination.
 Improved job satisfaction.
 Development of executives.
Authority
Authority is the right to initiate command and issue orders.
Types of Authority
1. Legal authority: Authority passed by law
2. Traditional authority: Authority passed from father to son.
3. Charismatic authority: Authority passed on personal charisma.
4. Technical authority: Based on knowledge and skill.
5. Position authority: It is based on position enjoyed by a person.
Responsibility
It is the obligation to perform an assigned work.
Difference between authority and responsibility
Authority Responsibility
It is the right to command It is the obligation to perform a
orders. duty.
Delegation is possible. It cannot be delegated.
It is a stable. It ends performance.
It flows downward. It does not flow.
 It can be withdrawn. It cannot be withdrawn.
Centralization
Centralisation refers to concentration of authority of decision making
at top level management.
Decentralisation
Decentralisation refers to the centres of decision making are
dispersed throughout the organisation.
Difference between delegation and decentralisation
Delegation Decentralisation
It refers to transfer of authority. It refers to systematic delegation
of authority
It is must for management It is optional
Good result in all type of Effective in big organisation.
organisation
It is a process. It is the end result.
Departmentation
It is a process of grouping of activities into units and sub-units for the
purpose of administration.
Need and importance of departmentation
 Increases the operating efficiencies of the employees.
 Increases the prestige of the department head.
 Further expansion of the organisation.
 Attaining specialisation.
 Helps to achieve better coordination.
Methods of departmentation
1. Functional departmentation
It refers to grouping of activities of an enterprise on the basis of
functions such as production, sale, purchase, etc.
Merits and demerits of functional departmentation
Merits Demerits
Specialisation. Chance for conflict.
Standardisation. Delay in decision making.
Higher efficiency. Difficult to coordinate various
departments.
Scope for expansion.
 Facilitate coordination.
2. Product wise departmentation
Grouping of activities on the basis of product is called product wise
departmentation.
Merits and demerits of product wise departmentation
Merits Demerits
Standardised products. Chance for conflict.
Better coordination. Delay in decision making.
Specialisation on product. Difficult to coordinate various
departments.
Effective control.
Development of overall
managers.
3. Territorial departmentation
Grouping of activities on the basis of location or geographical area is
called territorial departmentation.
Merits and demerits of Territorial departmentation
Merits Demerits
Cater the need of different More employees are required.
region.
Cost reduction. Maintenance cost is more.
Decentralisation of authority. Difficult to coordinate different
area.
Quick and prompt decision. Conflict between head office
and zonal office.
4. Customer wise departmentation
In this type, the whole enterprise is divided in to number of
departments on the basis of customers.
Staffing
According to Hiemann, “Staffing function pertains to the
recruitment, selection, development, training and compensation of
subordinates.
Need and importance of staffing
1. Key to other managerial function.
2. Adaptation of later technology
3. Higher productivity.
4. Maintaining good human relation.
Manpower planning
It is a process of putting right number of people at right place at right
time for the achievement of organisation goal.
Recruitment
It is the process of finding apt candidates and applies for jobs in the
organisation.
Sources of recruitment
Internal sources External Sources
Transfer Advertisement
Promotion Employment exchange
Demotion Campus recruitment
Present employees Labour union
Gate hiring
Selection
It is a process of selecting adequate number of persons who are fit
for the job.
Training
It is an act of increasing knowledge and skill of an employee for doing
a particular job.

Module II- Functions of management

Motivation
According to William G Scott, “Motivation means a process of
stimulating people to action to accomplish desired goals.”
Characteristics of motivation
 It is a continuous process.
 It is a psychological process.
 It is dynamic.
 It is goal oriented process.
 It is a complex process.
 It is based on motives.
Importance / Advantages of motivation
 It makes employees quality oriented.
 It is a basis for cooperation.
 It maintains good human relations.
 It create better image of organisation.
 It facilitates effective utilisation of human resources.
 It leads to low turnover and absenteeism.
Theories of Motivation
 Maslow’s Need Hierarchy Theory
 Herzberg’s Two Factor Theory
 Mc Cleland’s Achievement Theory
 Mc Gregor’s Theory X and Theory Y
 Theory Z (William G Ouchi)
Maslow’s Need Hierarchy Theory
This theory was propounded by Abraham Herold Maslow. It is the
most simple and widely accepted theory of motivation.
Assumptions of Maslow’s Theory
 Wants of human being are unlimited.
 Unsatisfied need act as a motivator.
 Needs are arranged in an order.
 One needs are satisfied, another set of needs arise.
Types of Needs
 Physiological Needs
These needs are related to the survival and maintenance of life. It
includes food, drink, oxygen, sleep and sex.
 Safety or Security Needs
These consist of physical safety against murder, fire accident,
security against unemployment etc.
 Social or Love Needs
These consist of need for love, affection, belonging or association
with family, friends and other social groups.
 Esteem or Ego Needs
The esteem needs are concerned with self-respect, self-confidence,
feeling of personal worth, feeling of being unique and recognition.
 Self-Actualization Needs
It is the desire to become everything that one is capable of
becoming. It is considered as the mission of the life of a person.

Herzberg’s Two Factor Theory

This theory was propounded by Frederick Herzberg. This theory is
also called two factor theory or dual factor theory. This theory
provides two factors that affect motivation in the work place which is
motivational factors and hygiene factors.
Motivational Factors Hygiene Factors
Achievement Salary
Recognition Job security
Advancement Personal life
Possibility of personal growth Work condition
Responsibility Status
Mc Gregor’s Theory X and Theory Y
This theory was propounded by McGregor. Theory X and theory Y are
theories of human work motivation and management.
Assumptions / Difference between Theory X and Theory Y
Theory X Theory Y
Workers hate work. Workers like work.
Workers are motivated by Workers can enjoy work.
money.
Workers avoid responsibility. Workers accept responsibility.
Workers lacks self-motivation. Workers are self-motivated.
Lack of creativity and resist to Creativity widely spread.
change.
Centralisation of authority. Decentralisation of authority.
 Mc Clelland’s Achievement motivation theory
This theory was propounded my David C Mc Clelland and his
associate. According to them, there are three important human
needs such as power, affiliation and achievement.
Need for affiliation Need for power Need for achievement
It reflects a desire to It reflects a desire to It reflects a desire to do
interact socially with obtain and exercise something better or
people. power and authority. more.
Theory Z (William G Ouchi)
This theory was given by William G Ouchi. This theory describes
major picture of Japanese management practices. Theory Z focuses
increased employees loyalty to the company by providing the job like
wit the strong focus on the well being of the employees both on the
job and off the job.
Leadership
It is the activity of influencing people to strive willingly for group of
objectives.
Characteristics of leadership
 It is a personal quality.
 It is the process of influence.
 It ensure absolute justice.
 A leader should have followers.
 It is the function of simulation.
 It is related to a particular situation.
Leadership traits/ Qualities of a successful leader
Personal Qualities / Traits Managerial Qualities / Traits
Intelligence Technical Knowledge
Self confidence Organising ability
Sound physique Ability to deal with others
Dynamic personality
Empathy
Responsibility
Tact
Emotional stability
Importance of leadership
 It motivates employees.
 Better utilization of human resources.
 It create confidence.
 It builds morale.
 Develop good human relationship.
 Promoting coordination.
Functions of leadership
 Integration
 Communication
 Production
 Team spirit
 Initiation
Major principles of leadership
 Justice
 Judgement
 Dependability
 Initiative
 Integrity
 Loyalty
 Enthusiasm
 Tact
 Decisiveness
 Endurance
 Personality
Leadership styles
 Autocratic style
 Free rein style
 Participative style
 Paternalistic style
 Charismatic style
Autocratic style
In this style manager centralize decision making power. Manager
gives orders to subordinates and obey them.
Types of autocratic leaders
1. Strict autocrat
Leader follow autocratic style in a very strict sense.
2. Benevolent autocrat
Leader influences his subordinates through positive motivation.
3. Manipulative autocrat
Leader try to make workers participation but actually there is not.
Free rein style
It means leaders giving complete freedom to his subordinates. In this
style leader play a minor role. Leader passes power of responsibility
to his subordinates. This style is also known as Laissez faire style.
Participative style
This style is also called democratic style. In this style leader
decentralizes his decision making process.
Paternalistic style
In this style leader assumes that his function is paternal or fatherly.
The relationship with leader and followers like father and his family.
Charismatic style
In this style leaders follow his subordinates through dint of
personality and charm.
Leadership theories
 Contingency theory
 Situational leadership theory
 Transformational leadership theory
 Transactional theory
 Behavioural theory
 Trait theory of leadership
 Path goal theory of leadership
Communication
Communication is the process of passing information from one
person to another.
Need and characteristics of communication
 It involves at least two persons.
 Message is must for communication.
 It may be written or oral.
 It is a two-way process.
 It maybe formal or informal.
 It is an integral part of the process of exchange.
Importance of communication
 It is a basis for communication.
 It is a basis for co ordination
 It promotes cooperation and human relations.
 It increases managerial efficiency.
 It emphasis effective leadership.
 It facilitate smooth functioning of organization.
Communication process/ steps
1. Sender: He is a person who send messages.
2. Message: It is a key idea that a sender wants to covey.
3. Medium: It is a means used to exchange message.
4. Decoder: He is the person to whom the message is intended.
5. Feedback: sender analysis the efficiency of messages.
Barriers of communication
 Physical barriers
 Cultural barriers
 Socio psychological barriers
 Poor listening
 Information overload
 Semantic problems
 Poor retention
 Time pressure
Steps to overcome communication barriers
 Uses of simple language
 Avoid noise level
 Active listening
 Emotion control
 Avoid information overload
 Proper media selection
Types of communication
1. According to organisation structure
Formal communication Informal communication
It is associated with formal There is no formal channel for
organisation structure. It is the communication. The informal
official communication. channel of communication is
also called grape wine.
2. According to direction
Downward communication Upward communication
Communication which flows Communication which flows
from the superior to subordinate position to superior
subordinates is called downward position is called upward
communication. communication.
3. According to way of expression
Oral communication Written communication
Communication with the help of Communication by using written
spoken words is called oral words, graphs, charts, etc. is
communication. called written communication.
Control
It is a continuous process of evaluating actual performance with
predetermined performance.
Features/Importance of control
1. It is a continuous process.
2. It is a corrective process.
3. It is forward looking.
4. It is a basis for future actions.
5. It helps in delegation of authority.
6. It shows weakness of management.
Steps in control
 Establishing standard.
 Measurement of performance.
 Appraisal of performance.
 Determining the reason for deviation.
Control Techniques
 Traditional
 Budgetary control
 Cost control
 Cost accounting
 Break even analysis
 Standard costing.
 Financial control
 Modern techniques
 Management audit
 PERT (Programme evaluation and review technique)
 CPM (Critical path method)
 Quality control.
Direction
It means issuing directives, order, instructions and commands to
subordinates.
Principles of direction
 Unity of command.
 Direct supervision.
 Communication.
 Unity of direction.
 Intelligibility.
 Direct communication.
Supervision
It means control and direction of subordinate’s activities.
Co ordination
It is the achievement of orderly group efforts and unity of action in
the pursuit of a common purpose.
Importance / Features and Techniques of coordination
Importance of coordination Techniques of coordination
Unity of action Sound planning
Specialization Well defined goals
Survival of the organisation Effective communication
Accomplishment of objectives Cooperation
 Differential perceptions Incentives
Cooperation
It refers to collective effort of people who associate voluntarily to
achieve specified objectives.

Module III- Business ethics

Ethics
According to Peter F Drucker, “Ethics deals with the right actions of
individuals.”
Features of ethics
1. It deals with human beings.
2. It is a social science.
3. It is about what is right and what is wrong.
4. It serve and guard business interest.
Branches of ethics
 Meta ethics- It is the study of meaning of ethics.
 Normative ethics – It is the study of moral duties, rules within its
social context.
 Applied ethics – It is the application of ethical principles.
 Moral ethics – It is the study of human behaviour, beliefs, etc.
Personal ethics
It refers to ethics that person identifies with in respect to people and
situations that they deal with in everyday life.
Professional ethics
It refers to ethics that a person must adhere in dealing their
professional life.
Theories of ethics
Teleological theory
This theories are concerned with the consequences of actions which
means the basic standards for our actions being morally right or
wrong.
Forms of teleological theories
1. Ethical egoism
The theory that the morality right action is the one that produces the
most favourable balance of good over evil for oneself.
2. Utilitarianism
The right action is that which produces the greatest happiness for
the greatest number.
3. Eudaimonism
This theory states that an action is good. It results in fulfilment of
goals along with welfare of human being.
Types of Teleological theories
1. Theory of utilitarianism
This theory states the right action is that which produces the
greatest happiness for the greatest number.
2. Theory of virtue
The virtue ethics approach emphasize the virtuous character of
individuals who makes the choices. It is the specific character traits.
Eg: Courage, truth telling, honest, kindness
Strength and weakness of virtue ethics
Strength Weakness
Character traits Without focus
Better people Self-centeredness
Broad and holistic Misguidedness
Agent centred
Sense of community
Preservation of goodness
3. Theory of justice and fairness
Justice as fairness is Rawls theory of justice for a liberal society. The
aim of a theory of justice is to propose principles to guide the
political and social institution in such a way that each individual
receives a fair share of social benefits and burdens.
Deontological theory
This theory asserts that the rightness of actions is determined partly
or entirely by their intrinsic value.
It includes
a) Duty theory
b) Right theory
c) Kantian theory of duty based ethics.
d) Rossian theory of duty based ethics.
 Moral standards
It refers to the norms which have about the type of actions to be
morally acceptable and unacceptable.
Values
Values are individual beliefs that motivate people to act one way or
another. Values are the guides of human behaviour.
Business Ethics
According to Rogene A Buchholz, “Business ethics refers to right or
wrong behaviour in business decisions.”
Characteristics of business ethics
 Discipline
 It is an art, science and both.
 Dynamic
 Ancient concept.
 Study of goals and means.
 Universal application.
 Relating to human aspects.
Scope of business ethics
Ethical problems in functional areas are:
Ethics in finance Ethics in Human Ethics in Ethics in
resource marketing production
Window dressing. Discrimination Misleading Defective
issues. advertisement. products.
Misleading Sexual Black markets. Dangerous
financial analysis. harassment. products.
Fake Occupational Grey markets. Problems arising
reimbursements. safety and health. out of new
technologies.
Inside trading. Affirmative Manipulation Environmental
action. of supply. issues.
Bribery and Price
kickbacks. discrimination.
Principles of business ethics
 Sacredness means and ends.
 Not to do any evil.
 Principle of proportionality.
 Cooperation with others.
 Publicity.
 Equivalent price.
 Service motto.
 Universal value.
Factors influencing business ethics
 Personal code of ethics
 Legislation
 Government rules and regulations
 Ethical code of the company
 Social pressures
 Ethical climate of the industry
 Corporate culture
 Professional codes
Basics of business ethics
 Honesty
 Integrity
 Loyalty
 Fairness
 Respect for others
 Leadership
 Law abiding
Importance/ Advantages of business ethics
 Increased goodwill.
 Helps in professionalism of management.
 Release from tension.
 Perpetual succession.
 Management credibility.
 Helps in decision making.
 Helps in face challenges.
Limitations of business ethics
 No reward for ethical conduct.
 No proper knowledge of ethical standards.
 Difficult to decide an act is ethical or unethical.
 It can reduce companys ability to maximize profit.
 It is not ideal for small business.
Arguments in favour and against business ethics
Arguments in favour of ethics Arguments against ethics
Ethics applies to all human Profit will ensure maximum
activities. social benefit, so no need for
business ethics.
Business cannot survive without Ethical company cannot be
ethics. competitive and viable.
Ethics is consistent with profit Profit maximisation ensure the
seeking. efficient use of society’s
resources.
Business ethics enhance Business already has enough
business performance power.
Business ethics promotes It creates conflict between
personal morality. profitability and ethics.
Code of ethics
A code of ethics is a guide of principles designed to help professional
conduct business honestly and with integrity. It is also called ethical
code
Globalisation
It refers to integration of economies and societies all over the world.
Globalisation and business ethics
Globalisation refers to integration of economies and societies all over
the world. Business transactions in different countries in different
languages and different cultures force companies to revisit ethical
principles.
Ethical issues in globalization
 Discrimination of women.
 Unfair treatment of workers.
 Unfair treatment of opposite sex.
 Language barriers.
Ethical issues in international business
 Employment practices
 Outsourcing
 Working standards and conditions
 Workplace diversity
 Human rights
 Work environment
 Bribery and corruptions
 Moral obligation of multinational firms.

Module IV- Corporate Social Responsibilities

Corporate Social Responsibility
CSR refers to the moral responsibility of the business by virtue of
being a part of society and resourceful to serve the society.
Corporate Philanthropy
It refers to activities which companies voluntarily initiate that aims to
manage their impact on society at large.
Corporate citizenship
Corporate citizenship may be defined as the way a company
exercises its rights, obligations, privileges and overall corporate
responsibility within the neighbouring and global environment.
Corporate Governance
Corporate governance may be defined as a broad range of policies
and ethical practices which are adopted by an organisation in its
dealings with the stake holders.
History of CSR activities
 CSR began to take hold in the US in 1970s.
 It began when the concept of social contract between business
and society was declared.
 The social contract is based on the idea that business functions
because of public consent.
 CSR is largely a post-world war II phenomenon.
 Initially CSR was in the form of a philanthropy by the corporate.
 Howard Bowen is often cited as Father of CSR.
 Executive perceptions of CSR, the survey report by Prof Sandra L
Homes address corporations ability to help society and severity of
a social needs.
Features of CSR
 Voluntary.
 Internalizing or managing externalities.
 Various stakeholder orientations.
 Configuration of social and economic responsibilities.
 Practices and values.
 Beyond philanthropy.
Need and Importance of CSR
 It aims at consumer protection.
 It aims at protection of local and global environment.
 It ensures respect for human rights.
 It results in avoiding bribery and corruption.
 It promotes adherence to labour standards.
 It gives employees a feeling of unparalleled happiness.
Steps in implementation of CSR activities
 Conduct CSR assessment
 Develop a CSR strategy
 Develop CSR commitments
 Implement CSR commitments
 Measure and assure performance
 Assure and report on progress
 Evaluate and improve
Advantages of CSR
 It creates a favourable public image.
 It enhance positive relationship.
 It encourage professional and personal growth.
 Good public image secured by an organisation.
 It helps to achieve sustainability.
 It increases profit.
 It increase customer retention and loyalty.
CSR and Business ethics
Corporate social responsibility Business ethics
CSR is an element of business It is the all encompassing
ethics. behaviour of business.
 CSR is more of a policy or an Business ethics is more of a
obligation to the community. conscience.
It aims to the benefit of society It aims to profit the employees
or local community. and company.
Stakeholders of CSR
 Shareholders
 Employees
 Consumers
 Community
 Government
 Creditors
CSR towards different sections of society/ different stakeholders
1. Responsibility towards owners and shareholders
2. Responsibility towards employees
3. Responsibility towards consumers
4. Responsibility towards creditors
5. Responsibility towards community
6. Responsibility towards inter-business relation
7. Responsibility towards government.
 Responsibility towards Owners and shareholders:
 It must ensure the safety of the funds invested.
 It provide reasonable return on investment.
 It ensure effective utilisation of fund.
 It provide honest report of business operation.
 Responsibility towards employees
 To ensure job security.
 To provide recreation, sanitation and medical facilities.
 To recognise social need of workers.
 To ensure fair treatment of workers.
 Provision of genuine trade union rights of workers.
 To maintain good relationship with employees.
 To ensure no discrimination of workers.
 To ensure protection of workers from occupational hazards.
 Responsibility towards consumers
 To offer good quality of goods.
 To follow suitable price policy.
 Exploitation of consumers should be avoided.
 Prompt services to customers must be ensured.
 Provide proper after sale services.
 Responsibility towards suppliers / creditors
 To provide accurate information related to financial health of the
organisation.
 To ensure a reasonable price for the articles supplied.
 To inform about changes in market.
 To inform supplier about future developments.
 Responsibility towards community
 To develop a good relationship with community.
 To minimise all kinds of pollution.
 To ensure development of backward areas.
 Organise cultural and religious functions for the community.
 To create employment opportunities.
 Responsibility towards inter-business relation
 To maintain good relationship.
 To avoid unilateral price fixation.
 To co-operate to form the forum of trade association, chamber of
commerce etc.
 To have fair trade practices with other firms.
 Responsibility towards government
 To obey laws passed by the local, state or central government.
 Firms should pay tax in time.
 It should invest their surplus funds in infrastructure bonds,
government bonds etc.
 They should not try to indulge in malpractices.
 It must not allow unfair trade practices.
Arguments in favour of CSR
 Long run survival of business concern.
 Corporate should have some moral and social obligation to
undertake welfare of the society.
 Proper use of resources.
 Capability and competence.
 Corporate should return a part of wealth.
 It creates a better impression.
 Company can avoid many legal complications.
Arguments against CSR
 Violation of profit maximisation.
 Lack of accountability.
 Increase in the price of product and services.
 Social action cannot be measured.
 Lack of regulation of CSR.
 Social issues are the concern of government, not business.
 Can reduce business public image.
CSR Initiatives/ Activities in India
CSR activities in India divided in to four phases
First phase
 CSR was driven by noble deeds of philanthropists and charity.
 CSR was influenced by family values, traditions, culture & religion.
 In 1900s the industrialist promoted CSR concept.
Second phase
 Industrialists were pressurized to show their dedications towards
societies benefits.
 Mahatma Gandhi gave the concept of trusteeship to the powerful
industrialists.
Third phase
 This phase is from 1960 to 1980.
 CSR was influenced by emergence of public sector undertakings.
 Corporate malpractices led to enactment of legislation regarding
corporate governance.
 In 1965 a national workshop on CSR held to address social
accountability and transparency.
Fourth phase
 From 1980 onwards Indian companies integrated CSR into a
sustainable business strategy.
 Increased momentum in industrial growth made companies to
contribute more towards social responsibility.

Module V- Emerging concepts in management

Kaizen
Kaizen means bring continuous small improvements in the overall
process and eventually aims towards organisation success.
Features of Kaizen
 Big results come from many small changes.
 It aims at continuous improvement of process.
 It is process oriented.
 Every employee contributes his own suggestions to improve work.
 Implementing Kaizen involves every member of the organisation.
 It is a philosophy that focuses both on the process and results.
Objectives of Kaizen
 To eliminate waste or activities that add cost and not value.
 Just in time delivery
 Production load levelling of amount and types.
 Standardised work.
 Paced moving lines and right sided equipment.
Kaizen Benefits
 It reduces wastes.
 It results in higher employee morale.
 It results in job satisfaction.
 Quality improvement.
 Faster delivery.
 Improvement in customer service.
 Improvement in customer relations.
 Improving system and processes.
 Achieving maximum efficiency and quality.
 Improvement in production aids.
Advantages of Kaizen
 It facilitates improved efficiency.
 Improved employee satisfaction.
 It facilitates waste reduction.
 Delegation of responsibility.
 Improved employees morale.
 It is a method for active problem solving.
 It encourage team work.
 It builds leadership skills.
Total Quality Management (TQM)
TQM is a management approach through long term success through
customer satisfaction. It is a combination of quality and management
tools.
TQM Tools
 Process Maps
 Poke-A-Yoke
 Statistical tools
 Force field Analysis
 Root cause analysis
 Fishbone Diagram (Ishikawa Diagram)
 Loss functions
 The Plan-Do-Study-Act (PDSA) Cycle
 Benchmarking
 Brainstorming
 Affinity Diagram
 Interrelation Diagraph
 Tree Diagram
 Prioritisation matrices
 Activity network diagram
Advantages of TQM
 Eliminates defects and waste.
 It helps in developing an adequate system of communication.
 Assures better quality performance in every sphere of activity.
 Helps in checking non-productive activities.
 Helpful in meeting the competition.
 Customer satisfaction.
 Improves employees Morale.
 It leads to cost effectiveness.
Disadvantages of TQM
1. Quality is expensive to implement.
2. Discourages creativity.
3. Production disruption.
4. Reduce workers output.
5. Employee Resistance.
Total Productive Maintenance (TPM)
TPM is a process of maximising equipment effectiveness through the
active involvement of all supporting departments.
Objectives of TPM
 Avoid wastage.
 Reduce cost.
 Produce a low batch quantity at the earliest possible time.
 Achieve zero defects, zero breakdown, and zero accidents.
 Involve people in all levels of organisation.
Advantages of TPM
 Increase in productivity.
 Increase in Overall Plant Efficiency.
 Reduce accidents.
 Reduce manufacturing cost by 30%.
 Customer satisfaction.
 Pollution control measures.
 Improve problem solving capabilities of workers.
Principles of TPM
 Autonomous Maintenance
 Focused Improvement
 Planned Maintenance
 Quality management
 Early equipment management
 Education and Training
 Safety Health Environment
 Administrative & office TPM
Management Information System (MIS)
MIS is a system that aids management in making, carrying out and
controlling decisions.
Features of MIS
 Management Oriented
 Management directed
 Integrated concept
 Common data base
 Avoid redundancy in data storage
 Heavy planning
 Subsystem concept
 Common data flow
 Flexibility
 Information as a source
 Need based
 Exception based
 Future oriented
Objectives of MIS
 Data capturing
 Processing of data.
 Storage of information
 Retrieval of information
 Dissemination of information.
Advantages of MIS
 It facilitates planning.
 It minimises information overload.
 MIS encourages decentralisation.
 It brings coordination.
 It makes control easier.
 MIS assembles, process, stores, retrieves, evaluates and
disseminates the information.
Disadvantages of MIS
 Highly sensitive
 Implementation is costly.
 Budgeting of MIS is extremely difficult.
 Quality of outputs is governed by quality of inputs.
 Lack of flexibility to update itself.
 Effectiveness decreases due to frequent changes in top
management.
ISO-International Organisation for Standardisation
It is a specialised agency for standardisation. The primary objective
of ISO is codification and unification of international standards.
Change Management
Change management is a systematic approach to dealing with
change both from the perspective of an organisation and individual.
Levels of Change Management:
 Individual change management
 Organisation change management
 Enterprise change management
Resistance to Change
Resistance to change is a natural reaction when employees are
asked, well, to change.
Reasons for resistance to change
 Misunderstanding about the need for change.
 Fear of the unknown.
 Lack of competence.
 Connected to the old way.
 Low trust.
 Poor communication.
 Changes to routine.
 Change in the status.
Stress Management
Stress management refers to changes to our life in a constant
stressful situation by practicing self-care and relaxation.
Causes of Stress at work
 Maltreatment or harassment.
 Feeling powerless.
 Continuous unreasonable performance demands.
 Lack of effective communication.
 Lack of job security.
 Long working hours.
 Excessive time away from home and family.
 Office politics.
Stress Management Techniques
 Meditation
 Exercise
 Breathing exercise
 Yoga
 Healthy diet
 Assertive communication
 Socialisation
Fishbone Diagram
Fishbone diagrams are causal diagrams. It was created by Kaoru
Ishikawa in 1968. The diagram is also known as Ishikawa diagram.
Types of Fishbone diagram
 Simple fishbone
In its basic form, the Ishikawa diagram has no predetermined
affinities or categories of causes, so we can decide affinities that may
be unique to our organisation.
 4S Fishbone
It classifies information about physical about potential causes into
four common categories- Suppliers, Systems, Surroundings and Skills.
 6M Fishbone
This variation, enable us to organise causes logically into 6
categories- Man, Materials, Machine, Methods, Measurements, and
Mother Nature.
8P Fishbone
This variation divides causes into 8 categories- Procedures, Policies,
Place, Product, People, Processes, Price, and Promotion.
Advantages of Fishbone Diagram
 Display relationship clearly and logically.
 It helps in maintain team focus.
 It facilitate brain storming.
 It show all causes of problem simultaneously.
 It stimulates problem solving.
 It allow for prioritisation of relevant causes.
 It helps to identify root cause of a problem.
Holacracy
Holacracy is a method of decentralised management and
organisational governance, which claims to distribute authority and
decision making through a holacracy of self-organising team.
Features / Advantages of Holacracy
 It is flexible and adaptable.
 It is a lively organisational structure.
 It is a unique decision-making process.
 It is highly adjustable.
 Increased transparency.
 It enables speedy decision making.
 It enables organisations innovation and accountability.
Rank and Yank
It is a process by which a company ranks its employees and
terminates the employment of the people at the lowest end of the
ranking.
Advantages of Rank and Yank
 It leads to increased productivity.
 It encourages competition.
 It helps to building great teams through consistency, transparency
and honesty.
 It establish a standard for ell employees.
Disadvantages
 It creates an unhealthy cut of star culture.
 It encourages unhealthy competition.
20% of Time
20% Of Time is a policy which allows employees to work on whatever
they want for 20 percent of their time on the job.
Gamification
It is a process for integrating game mechanics into something that
already exists to motivate participation, engagement and loyalty”.
Benefits of gamification
 Good learning experience.
 High levels of engagement.
 Managerial Insights.
 Instant feedback.
 Better learning environment.
 Versatile.
 Increase in recall and retention.
 Gamification motivates everyone.
 It increases teamwork.
Flexi working
Flexible working is a way of working that is adapted to suit the
employee’s needs.
Types of flexible working
 Part time working.
 Working from home.
 Job sharing.
 Compressed hours.
 Flexi-time.
Benefits of flexi working
 Flexibility to meet family needs and personal obligations.
 Reduced consumption of employee commuting time and fuel
costs.
 Avoids traffic and the stresses of rush hours.
 Increased feeling of personal control
 Reduces employee burnout due to overload.
 Reduced absenteeism and lateness.
 Increased employee morale.
Business Ecosystem
It is a strategic planning model whereby a network of suppliers,
distributors, competitors and customers all work through
competition and cooperation to advance sales of products.
Characteristics of Business Ecosystem
 Ecosystem are dynamic.
 Diversity and their collective ability.
 Creates and capture new value.
 Collaboration and competitive.
 It aims at innovations and commercial success.
 Large number of participants.
 Cooperation and competition.
 It creates new ways to address fundamental human needs.
Logistic management
It is the process of planning, implementing and controlling the
physical flows of materials and finished goods from point of origin to
point of use to meet customer needs at a profit.
Objectives of Logistics
 Reduction of inventory.
 Economy of freight.
 Reliability and steadiness in delivery performance.
 Minimum damage to products.
 Quicker and faster response.
Functions of logistics
 Order Processing.
 Inventory planning and management.
 Warehousing.
 Transportation.
 Packaging.
Classification of Logistical Activities
 Inbound Logistics
 Process Logistics
 Outbound Logistics
Significance or Objectives of Logistics management:
 Cost reduction and Profit maximisation.
 Efficient flow of manufacturing operations.
 Competitive Edge.
 Effective communication system.
 Sound Inventory management.
Key Activities involved in the logistics management
 Network design.
 Order Processing.
 Procurement.
 Material Handling.
 Inventory Management.
 Packaging and Labelling
 Warehousing.
 Transportation.

(This is the short note of First semester B.com BUSINESS MANAGEMENT. Prepared for
2021 admission students. To cover full syllabus in detail, please refer other available
materials too.)

Prepared by
RAHUL MURALI
JUBAIR MAJEED
For all subjects study material contact

8089778065 (WhatsApp only)