CHAPTER broad ‘and general guidelines ‘for the Managerial decision making and action, Types of Principles of Management * Fayol’s Principles of General Management * Taylor’s Principles of Scientific Management. Significance of Principles of Management "They ‘help to provide managers with tae dnsights into reality and increace their effi in deal problems. Of the decisions and actions “cae ne Predicted. Moreover, it leads to effective administration as the principles tendl vo restrict the personal prejudices and biases * They facilitate scientific decision makin as they emphasise on logical thinking rather than blind faith, * They helpin fulfilling social responsibility of an organisation, * They facilitate the process of management training, education and research os they are at the core of management theory. 34 ~ case Studies Mentorin Business studes-x a Principles of Management Features of Principles of Management i licability: The principles of (gate Sue say ee types and sizes of organizations. — * General Guidelines: The principles are guidelines to action but do not provide readymade, straitjacket_ solutions to all managerial problems as the real business situations are very complex and dynamic and are a result of many factors, * Formed by practice and experimentatio; The principles of management are formulated by the management experts through observation and tested through repeated experimentation. * Flexible: The principles of management * Mainly Behavioural: The Principles of Sr RaBement aim at influencing behaviour of human beings ina desired manner, ina large number of cases, * Contingent: The application of Principles of management is contingent or dependent upon the prevailing situation at Particular point of time. _. MemFAYOL'S PRINCIPLES OF MANAGEMENT * Division of work: The whole organisation work, both managerial and technical, should be civided into smaller jobs and the task involved in doing each such job should be determined. ‘fo specialization, speed, efficiency and accuracy of work. * Discipline: [t refers to the obedience to organizational rules and the employment agreement. ecessary for the systematic working of the organisation. It requires good superiors at all de: and fair agreements and judicious application of penalties. * Authority and Responsibility: There should always be a balance between the authority en and responsibility entrusted to an employee. This is because if authority is more than pO: y” the employees are likely to misuse it whereas if authority is less than responsibility, the will be unable to do the desired work. " of command: There sho: from whom he should re- 35ity fo Direction Difference between Unity of Comman and Unity fo Unity of Direction S.No. Basis Unity of Command 1 group of seit having : ive Each 1. Meaning | One subordinate Te imate same objective must have one orders from a head and one plan, responsible to only one superior. lapping of | eG It prevents over! 52) Aim It prevents dual subordination esas It affects the entire organi Implications It affects an individual employee Scientific Management: Definition Fredrick Winslow Taylor is known as the Scientific Management means knowing ” ‘Father of Scientific Management’. exactly what you want your employees to do and seeing that they do it in the best and cheapest way. ae. Techniques of Scientific Management a * Time Study is the technique to determine the standard time taken bya worker of average skill and knowledge to complete a standard task. cues * Fatigue study seeks to determine the amount and frequency of rest intervals required in completing a task. * Method study seeks to find out one best way of doing the job. * Motion study refers to the study of movements of limbs which are undertaken while doing a {ypical job-This helps to eliminate unnecessary movements co that it takes less time to complete the job efficiently. * Standardisation refers to the process of setting standards for every business activity Simplification aims at eliminating superfluous varieties, sizes and dimensions of products. * Functional foremanship is an extension of the Principle of division of wo: to the shop floor. Each worker is supposed to take orders from eight for Process or function of production namely ~ Instruction Card Clerk: He assigns work to all the employees. ~ Route Clerk: He decides how work will progress regarding total productions. So that production is on time. ~ Timeand Cost Clerk: He determines whatwillbe the totalcostand how much ~ Disciplinarian: He sees that there is discipline at work place. 7 Speed boss: He ensures that the work is moving at a suitable pace. ~ Gang Boss: He ensures sufficient availability of raw material, tools ete, ~ RepairBoss:Hesees| ‘hatwheneversomerepairisinvolvedinany work, thewor ~ Inspector: He sees that whether the quality of output is goo timeeach job take, kisdor d oF not, nePropanty, 36 P Case Studies Mentor in Business Studies-XIlFactory Manager 1 Manning In-charge Planning In-charge 1 ——- —- 1 Disciplinarian Gang Repair Inspector Speed Boss Instruction — Route time and Card Clerk Clerk Cost a er ple {L2BE system was introduced to reward efficient workers by paying them at a higher rate than thy who performed below standard. PRINCIPLES OF SCIENTIFIC MANAGEMENT * Science not Rule of Thumb . ¥ Taylor believed that there was. only one best method to maximise efficiency which can be developed through study and analysis and should substitute ‘Rule of Thumb’ or hit and trial method throughout the organisation. ¥ ‘the scientific method involved investigation of traditional methods through work-study, unifying the best practices and developing a standard method, which would be followed throughout the organisation, ¥ In the present context, the use of internet has brought about tremendous improvements in internal efficiencies and customer satisfaction. + Harmony, Not Discord ¥ Taylor emphasised that there should be complete harmony between the management and workers instead ofa kind of class-conflict, the managers versus workers. ¥ To achieve this state, Taylor called for complete mental revolution on the part of both management and workers. ¥ The prosperity for the employer cannot exist fora long time unless it is accompanied by prosperity for the employees and vice versa. ¥ He advocated paternalistic style of management should be in practice. + Cooperation, Not Individualism ¥ This principle is an extension of principle of ‘Harmony Not Discord’ ¥ There should be complete cooperation between the labour and the management instead of individualism. ¥ Competition should be replaced by cooperation and there should be an almost equal division of work and responsibility between workers and management. ¥ Also, management should reward workers for their suggestions which results in substantial reduction in costs. Y At the same time workers should desist from going on strike and making unreasonable demands on the management * Development of Each and Every Person to His or Her Greatest Efficiency and Prosperity ¥ Taylor was of the view that the concern for efficiency could be built in right from the process of employee selection. ¥ Each person should be scientifically selected and the work assigned should suit her/his physical, mental and intellectual capabilities. ¥ To increase efficiency, they should be given the required training. ¥ Efficient employees would produce more and earn more. This will ensure their greatest efficiency and prosperity for both company and workers. Principles of Management >» 37Pm & x 3 ‘ Universal applicability /- > Providing, managers with useful S € | ‘ insight into real 5 > General gui g eral guideli > Optimum ultisation of resources 2 : andcieivesdminiaion i : sand experience > Scent management 2 21 ~ > Meeting changing environment g | ¢ rapueents : 8 > Falling soci esponaity 2 & | » Management tring education i | andrea z | | 1 | — Taylor's Pineple of |-— Taylor's Techniques of po Taylor scientific management. | scientific management » Practitioner [> Scientist > Science not rule of thumb Work study Time study |» Focus on top level | ~® Focus on shop > Harmony, not discord > Standardisation and ‘Method stud) swan [ fag cnn stint Pn Moton dy ternal pice ; * Suggested nity * Suggested functional '‘—» Development of each & ane same Fatigue study —— foremanshi; ‘every person to his or . ther greatest eficiency Functional foremanshiaDifference between Fayol’s and Taylor's Approach to Management S.No. Basis Fayol Taylor 1 Perspective Top level management Shop floor level of a factory 2. Unity of Followed strictly Suggested the technique of functional command foremanship which is contradictory to the concept of unity of command 3 Applicability Universal applicability Applicable only in specialised situations 4 Basis of Personal experience Observation and experimentation formation 5. Focus Overall administration Increase productivity 6 Personality Practitioner Scientist 7 Expression General theory of Scientific administration administration Point of similarity Fayol Taylor Suggestions from employees Principle of Initiative Cooperation, Not Individualism Point of similarity Principle of scientific Technique of scientific management management One best method Science, not Rule of Thumb Method study PREFACE TO MNEMONICS Ronnie is here to help in memorising and easy recalling of the points related to key concepts through his sharing’s about his family members... Pappy Leaning Il! Concept 1: Features of Principles of Management My Mainly behavioural Grand General guidelines Father Flexible relativity Uses Universal applicability Credit Cause and effect relationships Card Contingent Freely Formed by practice and experimentation Principles of Management > 39Concept Z Importance of Principles of Management & ging envi t requirements : My = Meeting changing environsnent : sh Moni Management training, education and research >= leeps Scientific decisions 4 On Optimum utilisation of resources and fective administration ; fur Fulfilling social responsibility Pillow Providing managers with useful insights into reality &. Concept 3: Principles of Scientific Management > te) Dad Development of each and every person to his 4D, oo her greatest efficiency and prosperity - Has Harmony, not discord 4 Six Science not rule of thumb dj y Cars Cooperation, not individvalism Concept 4: Techniques of Seientitic Management & My Method study Sister Standardisation and simplification Flew Fatigue study From « Functional foremanship Mumbai Motion study To Time study Dethi Differential piece wage system Concent 5: Principies of General Management Division of work Initiative Scalar chain Centralisation and decentralisation Unity of command Stability of personnel Subordination of individual in DiscusseDp —__ our ———_ terest to general interest All Espirit de corps {—___ Discip| ‘motions Order Unity of direction Remuneration of employees Authority and responsibility Equity 40 b Case Studies Mentor in Business Studies-xitv ¥ + 2 x "OBJECTIVE TYPE QUESTIONS ) Previous Year's CBSE Board Questions Principles of management are NOT: (a) Applicable only in large firms (b) Formed by practice (c) Flexible (a) Contingent and experience of managers (CBSE Sample Paper 2019) . Additional Multiple Choice Questions The principles of management (a) Provide a straight jacket solution (6) Are flexible in nature (©) Are rigid in nature (@) Are absolute in nature Which of the following is a technique of management given by Taylor? (a) Espirit de corps ; (b) Harmony, not discord (c) Science, not rule of the thumb (d) Time study The ‘One best way’ to perform a task should be identified and implemented. Identify the technique of scientific management is defined in this sentence. (a) Method Study (b) Time Study (c) Fatigue Study (@) Standardisation and simplificaion of work Which of the following statements is true about Taylor and Fayol? (i) Taylor’s principles are applicable at the top level whereas Fayol’s principles are applicable at the shop floor level of management (ii) The principles of scientific management have been evolved through observation and experimentation whereas principles of general management are based on personal experiences (iii) The principles of scientific management have universal application whereas principles of general management have limited applicability (iv) Taylor was a mechanical engineer whereas Fayol was a mining engineer (a) Both (i) and (if) (b) Both (i) and (iii) (0) (i) and (iv) (@) (ii) and (fe) . Which of the following statements is true with reference to principles of management? (a) The principles of management have evolved. (b) The principles of management are yet to be evolved. (o) The principles of management are in the continuous process of evolution. (a) None of the above. By profession, FW Taylor was a (a) Mechanical engineer (b) Mining engineer (c) Psychologist (a) Human resource officer The principles of management have been developed on the basis of (a) Observation (b) Experimentation (c) Personal experiences of the manager _(d) Alll of the above Principles of Management ® 41) ight jacket solutions ymade straight jacket so! tog cnent do not provide readyma BO The principle ey Gee fot p (29 The teal business situations are complex. ( ms are dynamic. by Ths isineas situations are dy shines ae i ipl fat af tact as general guidelin (ALLE the above sed as per the reohine. z be changed as p *appli¢ation of the principles of management has to oS Per ee : gern bal ven statement? ot the OF management ( Contin (O) Mainly: behavioural (0) Cause and effect telationship GO) Genctal guidetines . . LO Principles of Management emphasize on logical and rational decision rae serie! than on the basis of bias and prejudice. The given statement highlights that the kn ge of Peuciples of management leads to ©) Providing managers with useful insight into reality (0) Scicutitic decisions © Mecting changing environmental requirements (4) AWG the above {Rate of thumb! refers to «being described in the (2 Use of petsonal judgement in handling management issues (© Adopting « hitand-tial approach te resolve management problems (0 Both of the above (a) and (by ( None of the above 12. Acconting to Taylor “each Specialist is to be assigned work according to his/her the employees who possess technical mastery should be involved in play whereas those with energy and Bood health may be assigned exe related principle of scient management, @ Eunetional foremanship (0) Science, not rule of thumb {0 Development of each and every Person to his or her greatest efficiency ang (None of the above 13. The objective of this technique of scientific management is to red, Product to fixed type sizes and characteristics, Name the technique. (@) Method stud (© Difterential piece wage system (©) Standardisation and simplification of work (2 Functional foremanship T qualities, : inning work ution work.” Name the 14. Which of the following is an objective of time study? (2) To determine the number of workers to be employed (©) To formulate su table incentive schemes (©) To calculate the labour costs (@) All of the above 42> Case Stusies Mentorin Business Studies XIed by Taylor in order to yee turnover should be uneration of employees Dec straight jacket solutions to all ons are complex and s to be changed as per the requirements point of time because the principles of management ar - . According to the small production planned and mar £ scientific management, “even a mi into boxes can be scientifically cording to .... : be rewarded for their s 6. Through the principle to be assigned work according management the employees should bstantial reduction in the cost. Taylor advocated that each specialist is . Agile Automobiles Limit: sy . This shows that th is being adopted by the company 8. The principle of ..... discord lemented the concept of assembly line in its production . technique of scientific management is an extension of the principle of Harmony not 9. Through the principle of ........ application of penalties within n organization. 10. Henri Fayol guides the managers to exhibit exemplary behaviour and should not fall into temptation of misusing there powers for personal benefit at the cost of general interest of the organization. The . principle is being described in the above line. . Fayol emphasized on the judicious IV. State whether true or false. (Give reason in support of your answer). 1. The principles of management are in the continuous process of evolution. 2. The principles of pure science are considered to be flexible in nature. 3. The principles of management have been developed only on the basis of personal experiences of the manager. 4. The principles of management have universal validity. 5. The concept of work study techniques includes the technique of fatigue study. Principles of Management > 43ientitie management iS to reduteg hod study technique of scientific manage a 6. The objective of method stv hk heealedalas tine or a product to fived type sizes and cha eee Re piece rate system: was ‘ The technique of ditterential pie is oe discriminate between clticient and inefficient we igher production ang ates york leads to higher pro id by 8. The application of the principle of Division of wor “tty Work for the same effort, 9, + Acconting to Hi discipline Sari Fayol, if the principle of discipline is violated,” ra is unde) is in jeopardy, onder disturbed and stability threatened 10. The princips Par by the "Ming e same level are not tre, le of order Suggests that if two employees at the same le re, *t superior, it would lead to job dissatisfaction, V. Match the followin Ll ated '9 by choosing the correct option. ST Column B >> ‘olumn, al ily of Comma (9 Each work is done by a trained specialist (©) Unity of Commang () Judicious applic of penalties () Unity of Direction (#8) Dual subordination should be (2) One he, avoided (© Division of work ‘ad and one plan @) ()-(a); HY); Gi)-(0); (iv)-(a) (©) (0-0); (i)-(a); (iti) -( ©) ()-(); CAD; Gi)-(a); (i)-(b) (@) (-); (iO); (ii @) Discipline Column A (9 Affects an individual er Column B mployee (@) Scalar Chain () Centralisation and Decentralisation (i) Affects the entire organization, (ii) Formal lines of authority and subordin, between supe ates iors (©) Unity of Direction () Concentration of decisions making authority (@) ()-(@); (-0); (iii) (c); ()-(a) 0) (i)-(); (i (9) (IO (id-(a; (i). (iv)-( @ (A; 3. 7 (4) Unity of Command 0); (ii); (in)-(0) } Gita); (in) -(p Column A ( Manager should rep Column B 1 conv. (@) Equity lace ‘I’ with ‘we’ in, ‘ersations with workers (1) Employeesshould not be (iii) Right mi: place all his transferred frequently (0) Order | terial should be placed at the right © "De Comps | (iv) No worker should be unduly, favoured @) OC); Ga); Gi © (Ha); (iD); ( (@) Stability of py 2) D0 Ga; (id Case Studies Mentor in Business Studies-xil: a Column B (i) Emphasises on mental revolution (a) Development of workers to their greatest efficiency and prosperity (ii) Scientific study and analysi element of job ‘alysis of each (b) Cooperation not individualism (iii) Adopt a suggestion system (©) Harmony, not discord (ia) Assign job to workers as per thei . a sr menial and intellectual eon aaa (d) Science, not rule of Thumb (Os (0; a: (i) i (0); (iv)-(a) (b) (i)-(c); (ii)-(d); (iti)-(b); ()-(a) (Oy oh) 1)-(0); (ii)-(d); (iti)-(b); (iv)-(a (@) ()-@); (HC; (iti)-(a); (e)-(0) 2 _ Column A Column B (i) Responsible for keeping tools and machines (a) Route Clerk ready for operation (ii) Specifies the exact sequence and route of (®) Repair boss production (iii) Checks the quality of work (c) Gang boss (iv) Ensure proper working conditions of tools (@) Inspector and machines © (b) (0s (Da; (ie; (FO) €) (A); (FC; (DL; OO) (@) (0-0); C-(0s (D-(; oy) (c) (i)-(a); (ii)-(0); (iii)-(d); (iv)-(b) Answer I, Previous Year's CBSE Board Questions 1. (a) Applicable only in large firms. Il. Additional Multiple Choice Questions 1. (b) Are flexible in nature 2. (d) Time study 3. (a) Method Study 4. (d) (ii) and (iv) 5. (c) Principles of Management are said to be evolutionary in nature as these principles have evolved over a long period of time with continuous practice and experimentation. 6.(a) 7. (a) 8. (a) 9. (a) 10. (b) Principles of management are not based on rule of thumb/hit-and-trial method, but on a scientific approach. 11.0) 12. (c) 13, (c) Through the technique of simplification, Taylor suggested elimination of unnecessary diversity of products. 14. (a) Principles of Management ® 45EF eee payntern, ‘Valor advocated Mead to MALIIENE Work pout the reeruit nent : piece rate War eof differential | ie an COUP Jy the techniqu ara ge rale 15, Though the tein efficient workers should bs oe F ove shoul be taken while , rate cling to Royal, tt eal ee panel be placed at particular position 5 othe new recruits sufficient tenure. m. the blanks sient exible 5, Comings a fi x a, not individualism 5, Cooperati 1. Dynamic 4, Science, not rule of thumb 6. Development of each and every P 7. Method study 8, Cooperation, 9. Discipline 10, Subordination of 8 {efficiency and prosperity jerion to bis or her BF not individualion dividual interent 0 IV. ‘True or f 1. True 2 3. Fals 4, alse (they are univer 5. True (besides, it also 6. False (it is the te e ae (it is the technique of Standardisation and simplific: 8. True 2 oe tthe principle of Unity of command is violated) ¢ (the principle of equity is being described) (they are (because they may be based on observation and exp ‘ally applicable, but lack universal validity) neludes time study, motion study and method study) tion of work) erimentation as well) V. Match the following 1. (c) 2. (d) 3. (a) 4. (b) 5. (b) LATEST CBSE QUESTIONS) QUESTION 1: Principles of rinciples of management equip the theledechionsand action Lauip the managers to foresee the caus dently the poet ne ihe WastoBes associated With atrial wed Geet feltIOnships of ance of principles of manager egret aPPFOach can answer agement highlighted fone (CBSE, OD 2079) Optimum utilisati utilisation Taringeee sr of resources is the rel related point of signifi OF ‘Significan ANCE Of princi, Principles les of QUESTION 2: Appliances Indi is fa itd. is engaged in manufacturing and luring and distributi ion of home 1987. It ha: ‘Sa good name ii me in the market as the company i 'Y 18 producing good qual p 2NCes si ality ine 46 Case Studies Mentor in Business 5 La lusiness Studies-xit(Toe septs slepartnienty fae manutactiing, finance, sales, maintenance services and fovhateal services ty avhieve specialization Saye The iteas a operations af the company have increased and customers have become wow stennidtitys, he company decided to modify the existing, principle of management to anect the Changing fequttemente al the environment state th yy weral principle af management which the company wants to modify to meet the changing fequirements a :, Dellti 2019) ANSWER the changing yeneral peineiple oF management whieh the company wants to modify to meet the Hequitements is Division of wark QUESTION 3; Danial D'Souza took aver the reins of Kinsa Retail’ as its Managing Director in India. ‘Kinsa Retail’ with ils headquarter at Japan has been in the retail business for the last 40 years. It has regional offices: in many countries that lake care of the shops in that region. As it is a lage e_ianiiation, the tegional olticers have been given the powers to decide and spend funds sanctioned to then by the headquarter for the welfare of the customers of their region. Kinsa Retail! wants the highest possible standards of ethical conduct being followed, for whieh a code of conduct is in place for putting values into practice. All employees as well as Board members are required to aet in accordance with the highest standards of personal and professional integrity when acting on behalf of the company. Non-compliance involves aheayy penalty including termination of employment. Explain any two principles of general management being, followed by ‘Kinsa Retail’, (CBSE, OD 2019) ANSWER: The Wwe principh below: of general management being followed by ‘Kinsa Retail’ are explained ion: Centralisation is said to exist in an organisation (0) Centralisation and decentrali 'y is concenterated in the hands of top level Where the decision-making, autho management Decentralisation involves a systematic dispersal of authority at all levels of management in order to cnable the managers at all levels to take the decisions appropriate at their love According, to Fayol, “There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through centralisation.” He emphasis that both centralisation and decentralisation should exist together to ensure smooth running, of an organisation. Both the situations of complete centralisation and complete decentralisation are not healthy for any organisation. The large organisations have more decentralisation than small organization. (b) Discipline: According, to Fayol, “discipline requires good superiors at all levels, clear and fair agreements and judicious application of penalties.” Through this principle Fayol, emphasizes on the need to create a healthy work environment in an organization. In order (0 maintain discipline in an organisation it is necessary; that the rules and regulations are clearly communicated to all the employees, their behaviour is closely monitored by superiors at all levels, and there is judicious application of penalties whenever needed. It is necessary for the systematic working of the organization that both managers and workers observe discipline. Principles of Management ® 47QUESTION 4; ‘Scientific Management means knowing exactly do itin the best and the cheapest way.’ Taylor develope’ | Scivntific Management principles and was able to achie tt in Bothlehert Steel Company, where he worked oe tiv ‘number of workers to be employed; frame s1llabl ant men to do and seeing that they or ariouts techniques for application of i hree-fold increase in productivity -2 techniques helps to determine the achemes and determine labour Ie to accomplish /excced the what you © ars who are ab! f work a the result of the joint effor costs, Another technique recognises those NT ficiency ee easraph rey ea faitvdnyfarwark’andllstb + the prem iim the above paragraph, ya hin work and is ba: aed ‘Quoting the lines from (CBSE, OD 2019) of the managers and the workers: Quo TY nent explain the two techniques of Scientific above paragraph are as follows: the standard time taken by a n standard task. A worker with eves him with a stop watch ements of a job. Thus, indard time is fixed ANSWER: The two techniques of S xplained in the ment explaine to determine Scientific Manag the technique : i a owtedge to complete 3 $8 wa A i tected ancl an expert observe i jonable shill and aay sim in completing the vor ye sta {ge ne or cach element tas! ote ering, devices (OF eC NT fr of ee ea verermine the number of workers to be of the fs ineentive schemes and determine labour costs nt : vage system — Differential piece wage system a) an ere rate wage syst or this plan, the piece wage rate paid to efficient Tayo cece wage rate. According to Taylor, the wages normal pies he distinguished on the basis of level of orkers to improve their performance besides motivating them to (a) Time study ~ avorker of average Quote = “On canployed; frame (0) Differential piece bonus plan suggested by vorkers is higher than the wifficient and inefficient workers shoul Guput which helps to stimulate less efficient work” and provides higher job satisfaction to efficient workers, naintain the higher level productivity. Quote - “Another technique recognises those workers who are able to accomplish, cuore the fair day’s work and is based on the premise that efficiency is the result of the joint efforts of the managers and the workers.” QUESTION 5: Vishesh completed his MBA at a reputed business school in Lucknow. He was impressed by the Principles and Techniques of Scientific Management developed by FW. Taylor. On completing his MBA, he wanted to apply Scientific Management in his family’s business of fast food chain of restaurants named ‘Burger Mania’. His main goal was to reduce costs with increased output. To begin with, he wanted to develop a standard method which would be followed throughout the organisation. So, he investigated traditional meihods through work study and unified the best practices. The standard method, ie. the best way of doing the job was then developed taking into account all Parameter ight from the procurement of raw materials till the delivery of the final product fo the customer. Vishesh also believed that each person should not only be scientifically selected but should also be given the requi i i i ee seienie nea Tene training to increase efficiency, For this, he set wpa Spe ani ’ in Bengaluru where the i eee sing earn the best method. At the factory, the ae oe gically placed to reduce the time taken for excess movements. Thi au de j . The standar 48 > case Studies Mentor in Business Studies Xitime and other parameters were determined on tl the workers for meeting the standard output, Now, ‘Burger Mania’ has stand; and working conditions that ensu: same high standards of excellence the basis of work study and Vishesh rewarded lardised processes, raw material, time, machinery, product re that the food they send out to their customers has the and level of quality in every chain or franchise. The application of Scientific Management to every aspect of restaurant operations led to ‘Burger Mania’s’ widespread success, Quoting the lines from the above, explain the Principles and Techniques of ‘Scientific Management’ used by ‘Burger Mania’. (CBSE, OD 2019) ANSWER: (a) The various principles of scientific management used by Burger Mania describe below: () Science not rule of thumb: Taylor evolved of the method of scientific inquiry into the sphere of management in practice. Taylor believed that there was only ‘one best method’ to maximise efficiency which can be developed through study and analysis. The method so developed should substitute ‘Rule of Thumb’ or hit and trial method throughout the organisation. Line from paragraph ~ “The scientific method involved investigation of traditional methods through work-study, unifying the best practices and developing a standard method, which would be followed throughout the organisation. So we investigated traditional methods through work study and unified the best practices.” (ii) Development of Each and Every Person to His or Her Greatest Efficiency and Prosperity: Taylor acknowledged that the industrial efficiency could be promoted only through the development of workers. He was of the view, that the concern for scientific approach and efficiency should be incorporated right from the process of employee selection. Efficient employees would produce more and earn more. This will ensure their greatest efficiency and prosperity for both company and workers. Line from paragraph ~ “Vishesh also believe that each person should not only be scientifically selected but should also be given the required training to increase efficiency for this is set up a special training unit called ‘Hamburger’ in Bengaluru where the workers were given the required training to learn the best method.” (b) The various techniques of scientific management used by Burger Mania are described below: (i) Time study: Time Study is the technique to determine the standard time taken by a worker of average skill and knowledge to complete a standard task. Time study serves many purposes as stated below: (a) To determine a fair day’s wage. (b) To determine total labour cost. (0) To determine the number of workers to be employed. (d) To frame suitable incentive schemes Line from paragraph - “the standard time and the other parameters were determined on the basis of work study. (ii) Standardization and Simplification: The term ‘Standardisation’ literally means conforming to predetermined requirements in terms of size, design, weight, quality, etc. Simplification aims at eliminating superfluous varieties, sizes and dimensions of Principles of Management ® 49.Products. Te leads to economical operations as there is savings of cost of labour 1 ensures optimum utilisation. gf reduced inventories. equipment and rise in turnover, Une from paragraph — “Now burger Mania has standardized process is raw mate Sme machinery product and the working conditions that er Sex out to the customers has the same high standards of ex of quantity franchise.” Motion stud) Motion study refers to the study of movements of limbs which are undertaken while doing a typical job. To complete the job efficiently in less ting by eliminating unnecessary movements of the limbs of 4 worker. ‘Taylor established that the productivity increased four folds by following this process, He believed that through close examination of body motions of a worke ‘Pical job, for example, it is Possible to find out: Motions which are productive in nature Motions which are incidental in nature (e.g, going to stores) Motions which are unproductive in nature © fom paragraph ~ “At the factory the ingredients strategically placed to reduce the time t ©) Method study: Method study seeks to find out one best way of doing the job, Method study helps to determine one best way of carrying out an activity. It helps in minimising the cost of production and mexiat ing the quality of output and level of customer satisfaction by deciding the sequence of operations beginning from the procurement of raw materials snd continuing till the product is finally delivered to the consumer. ite fom paragraph ~ ‘the standard method that is the best way of doing the Job was then developed by taking into account af Parameters right from the Bie wrement of raw materials till the delivery of the final product to the customer, His main goal was to reduce cost with increased output he wanted to develop a standard method we should be followed throughout the organisation,” QUESTION 6: Karan Nath took over ‘D’ North Motor Company’ from his ailing father three month ago. In the past the company was not Performing well. Karan was determined to improve the OF opal, S Performance. He observed that the methods nf Production as well as selection of employees in the company were not scientific He believed that there was only one best method to maximise efficiency. He also felt that ones the method is developed, the workers Sate SomPany should be trained to learn thar ‘best method’. He asked the Production Manager to develop the best method and carry Manager developed this method using several Parameters right from of operations, place for men, machines and rave materials till deliver customers. This method was implemented throughout the organis. the output, improving the quality and reducing the cost and wast Principles and the technique of scientific management followed in the above case. ial ure that the food they ellence and the level * doing a making up a burger were faken for excess movements.” ation. It helped in increasing ‘age. Identify and explain the by the Production Manager (CBSE, Delhi 2018)case ate described below (2) Science not Rule of Thumb: Taylor believed that there was only one best method to maximise efficiency and it could be developed through scientific study and analysi This is because if the managers rely on personal judgment in attending to the work related problems it may suffer from the limitation of a trial and error approach. Therefore it is important for them to know what works and why does it work. For this, they should adopt scientific method to substitute the ‘Rule of Thumb or hit and trial method’ throughout the organisation. (0) Development of each and every person to his/her greatest efficiency: According to Taylor, the best results of u: ific approach would come only when the due importance is given to certain spects. Firstly he said efficiency should be the topmost concern right from the time workers are being selected. Secondly, the workers should be assigned jobs as per their individual potential in terms of their intelligence, social, mental and physical quotient. Lastly, inorder to enhance their performance workers should be subject to training. Thus, development of each work in a scientific way will ale higher productivity, thereby ensuring prosperity for both management and workers, The technique of scientific management followed by the Production Manager in the above case is Method Study. Method Study: The objective of method study is to find out one best way of doing the job among the various methods available of doing the job. This can be done by taking into consideration several related parameters. QUESTION 7: Rajat joined as a CEO of Bharat Ltd., a firm manufacturing Computer hardware. On the first day he addressed the employees. He said that he believed that a good company should have an employee stiggestion system and he wished to minimize employee turnover to maintain organizational efficiency. He informed all employees that he would ensure that all agreements were clear, fair and there was judicious application of penalties. However, he said that he believed that lazy personnel should be dealt with sternly to send the message that everyone was equal in the eyes of management. Also that he would want to promote a team spirit of unity and harmony among employees, which would give rise to a spirit of mutual trust and belongingness among team members and eventually minimize need for using penalties. He told all present that the interests of the organization should take priority over the interests of any one individual employee. (a) Identify and briefly explain any four principles of management given by Fayol, which Rajat highlighted in his address to the employees. (b) Also state two values that Rajat wanted to spread in the organization. (CBSE, Sample Paper 2018) ANSWER: (a) The following four principles of management are being highlighted by Rajat in his address to the employees: (i Initiative: Initiative means taking the first step with self-motivation. The workers should be encouraged to develop and carry out their plans for improvement. Suggestion system should be adopted in the organization. (ii) Stability of Personnel: The employee turnover should be minimized to maintain organizational efficiency. Personnel should be selected and appointed after due Principles of Management & 51heir post fo, hould be kept at their post fo, i . After placement they s! . Any adhocism in th: regard will create instability /insecurity among employees. leave the organisation. istional rules and employmeny a ic rganisational 5 y (iif) Discipline: Discipline refers to ip cresuen eo f the organisation, According r agreement which are necessary for the w. Il levels, clear and fair agreement Fayol, discipline requires good superiors at all levels, and judicious application of penalties. : Jed " ™ rience are needed to ensure (i) Equity: According to Fayol, “Good sense and ever faily as possible.” The faimess to all employees, who should be treate he behaviow of menage principle emphasizes on kindliness and justice in the be st anyone on ages spares workers. The managers should not discriminate again: of gender, religion, language, caste, belief or nationality etc. ey (The other correct answers are principle of Subordination of individual interest to general interest/Espirit de corps) (6) The two values that Rajat wanted to spread in the organization are: ( Discipline (i) Team work QUESTION 8; Sanchit, after completing his Carer eneurship course from Sweden returned to India and Sarted a coffee shop ‘Aroma Coffee Can’ in famous mall in New Delhi. The speciality of the coffee ship was the special aroma of eoffec and a wide variety of flavours to choose from, Somehow, the business was neither Profitable nor popular, Sanchit was keen to find out the tea on. He appointed Sandhya, an MBA from + reputed college, as a Manager to find out the causes for the same. Identify and explain any two techniques of scientific management used by g, solve the problem. (CBSE, Detni 2017) ANSWER: flevices for each element of task the standard time is fea the whole of by taking several readings, (©) Simplification (Sta davdisation and Simplifcation): Simplification aims at eliminat; superfluous diversity of products in terms of vatietice, sizes and dimensions, tre only helps to reduce inventories but also save cost of labour, machines and toons met it helps to increase turnover by ensuring optimum utilisation of resources, ps) 52 P Case Studies Zentorin Business Studies-Xil Mt»(©) Motion study: Motion study refers to the study of movements of limbs of a worker while doing a Particular ta: a3 ivi i ies namely; k, It seek to divide all such movements into three categori ( Motions which are required (ii) Motions which are unnecessary (ii) Motions which are incidental, Thus, motion study h imi mee ‘elps to eli nables him to complete fi PS to eliminate unnecessary movements of a work and e1 the given task efficiently. QUESTION 9: Nutan Tiffin Box service was started in Mur i i las who are the soul of entire Mantes son Mumba by the Mumbai Dabbawalas. The Dabbawal on rovide prompt and efficient services by providing tasty poe tiffin to all office goers at the right Ene wed place. The service is uninterrupted even on the days of bad weather, political unrest and social disturbances. Recently, they have started online booking system through their website ‘mydabbawala.com’. Owing to their tremendous popularity amongst the happy and satisfied customers and members, the Dabbawalas were invited as guest lecturer by top business schools. The Dabbawalas operate ina group of 25-30 people alongwith a group leader. Each group teams up with other groups in order to deliver the tiffins on time. They are not transferred on frequent basis as they have to remember the addresses of their customers, They follow certain rules while doing trade—no alcohol during working hours; no leaves without permission; wearing white caps and carrying ID cards during business hours. Recently, on the suggestion of a few self-motivated fellow men, the dabbawalas thought out and execi uted a plan of Providing food left in tiffins by customers to slum children. They have instructed their customers to place red sticker if food is left in the tiffin, to be fed to poor children later. (a) State any one principle of management given by Fayol and one characteristic of management mentioned in the above case. (b) Give any two values which the Dabbawalas want to communicate to the society. (CBSE, Sample Paper 2016) ANSWER: (a) The relevant principle of management given by Fayol is: Stability of Personnel: The employee turnover should be minimized « maintain organizational efficiency. Personnel should be selected and appointed after due and rigorous procedure. After placement, they should be kept at their post for a minimum fixed tenure so that they get time to show results. Any adhocism in this regard will create instability /insecurity among employees. They would tend to leave the organisation. (The other correct answers are principle of Discipline / Initiative / Espirit de corps) The characteristic of management mentioned in the above case is: Management is goal oriented as it seeks to integrate the efforts of different individuals towards the accomplishment of both organizational and individual goals. (The other correct answers are management is intangible/ group activity/dynamic) (b) The two values that Dabbawalas want to communicate to society are: ( Concern for poor/ Humanity Principles of Management ® 53a ws QUESTION 10: ints and encourages te, “Aapka Vidyalaya’ believes in the holistic development a students On its Founder's Den building through a mix of curricular, co-curricular and sports efects was constituted to pj a stage performance had to be put up. A committee of ten ret paper for decoration, Thee different aspects of the function, They all decided to use recycle eee other With mung was a spirit of unity and harmony and all the members er planned and executes trust and a sense of belonging, the programme was ST applied one of Kartik, one of the prefect, realised that the group had unl See eas inapinal principles of management while planning and executing the pri : the same principle in he by the success of this function that he asked his father to apply ‘ business. His father replied that he was already using this principle. . ramme, (a) Identify the principle of management applied for the success of the progrs (b) State any two features of management highlighted in the above paragraph. i . i to society. (6 Identify any two values which ‘Aapka Vidyalaya’ communicated (CBSE, Delhi 2015) ANSWER: ‘ ee (4) The principle of management applied for the success of the programme is Espirit De Corps. (6) The two features of management mentioned in the above paragraph are as follows: () Managemen is goal oriented as it seeks to integrate the efforts of different individuals towards the accomplishment of both organizational and individual Boals. (ii) Management is pervasive as itis applicable to all types of organizations, (economic, Social, political) all sizes of organizations (small, medium, large) and at all levels of management (top, middle and lower) (c) The two values that “Aapka Vidyalaya’ communicated to society are: (i) Responsibility (ii) Sustainable development, QUESTION 11: Telco Ltd. manufactures files and folders from old clothes files and folders. For this, they employ people from nearb qebortunities are available. An employee, Harish, designed Was not welcomed by the production manager improvements in design, but it also was not appreciated by the (a) State the principle of management that is violated in the above paragraph. (H) Identify any two values that the comp: any wants to communicate to the society. (CBSE, OD 2014 ANSWER: : (@) The principle of management that has been violated in the above case is Initiative Initiative means taking the first step with Self-motivation. The worke encouraged to develop and carry out their pl core as should be should be adopted in the organization, ystei (®) The two values that the company wants to co (i) Concern for environment (ii) Proy lans for improvement, mmunicate to the society are viding job opportunities 54 Case Studies Mentor in Business Studies-XilQUESTION 12: pawan is working as a Production Mani ager in CFL Ltd. which manufactures CFI. bulbs. There ete Gear eile: Phiten the management and workers. The working qraltigal ax Vay good. The company is earning huge profits. As a policy, the management shares the profits earned with the workers because they believe in the prosperity of the employe (a) State the Principle of management described in the above paragraph. (b) Identify any two values which the company wants to communicate to society. (CBSE, OD 7014) ANSWER: (a) The principle of mana; Discord’, Taylor emphasised that and workers instead o} igement described in the above paragraph is ‘Harmony, not there should be complete harmony between the management i e f a kind of class-conflict, the managers versus workers. To achieve this state, Taylor called for complete mental revolution on the part of both management and workers. The Prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice versa. He advocated paternalistic style of management should be in practice. (b) The two values that the company wants to communicate to the society are: () Prosperity (ii) Sharing QUESTION 13: Voltech India Ltd. is manufacturing LED bulbs to save electricity. However, it is running under heavy losses. To revive from the losses, the management shifts the unit to a backward area where labour is available at a low cost. The management also asks the workers to work overtime without any additional payments and promises to increase the wages of the workers after achieving its mission. Within a short period, the company starts earning profits because both the management and workers honour their commitments. (a) State the principle of management described in the above paragraph. (b) Identify any two values that the company wants to communicate to the society. (CBSE, Dethi 2014) ANSWER: (a) The principle of management described in the above paragraph is ‘Dis Discipline- It refers to the obedience to organizational rules and the employment agreement. It is necessary for the systematic working of the organization. It requires good superiors at all levels, clear and fair agreements and judicious application of penalties. (b) The two values that the company wants to communicate to the society are: () Trust (ii) Sustainable development QUESTION 14: ABC Ltd, is engaged in producing electricity from domestic garbage. There is almost equal division of work and responsibilities between workers and the management. The management even takes workers into confidence before taking important decisions. All the workers are satisfied as the behaviour of the management is very good. Principles of Management > 55ph sseribed in the above pal (a) State the principle of management deseribed in ue fo communicate to society any wants (BL, Detiy yy () Identify any two values which the con, voy a \ » paragraph Is Cooperation, ¢ (0) The principle of management described in the above paragta] Wt Individualisny’ ; ‘Harmony, Not Discord’. There sheng, This principle is an extension of principle of ‘Harm DAN essere individ complete cooperation between the Jabatir and the mana, tier aout be on a Competition should be replaced by cooperation ane bers and managenuny, ye equal division of work and responsibility between wor Aird ults in substan aaement shoul! reward workers for thei suggestions wih wn fe substan reduction in costs. AL the same time, workers should desiot from soit, Of strike ap sonable demands on the management making unre. jcate to the society are: company wants to communicate to th iy (®) The two values that the (i) Participation (ii) Sustainable development QUESTION 15: The principles of Tylor and Fayol are mutually complementary. One believed thy management should share the gains with the workers while the other suggested that employees’ compensation should depend on the carning, capacity of the company and should give them a reasonable standard of ing, aylor referred to in the above paragraph (CBSE, Dethi 2014) Mdentify and explain the principles of Payol and ANSWER: The principles of Fayol and ‘Toylor referred to in the above paragraph are ‘Remuneration of employees’ and ‘Harmony, Not Discord’ Rennneration of Employes: According, to Fayol, the overall pay and compensation should be fair and equitable to both employees and the organisation. The employees should be paid fair wages so that they are able to maintain at least a reasonable standard of living. At the same time, it should be within the paying capa ity of the company. This will ensure pleasant working atmosphere and good relations between workers and management, Harmony, Not Discord: Taylor emphasised that there should be complete harmon y between the management and workers instead of a kind of cla “conflict, the managers versus workers. To achieve this state, Taylor called for complete mental revolution on the part of both rie agement and workers. The prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice wens Me advocated paternalistic style of management should be in practice. QUESTION 1 The principles of Taylor and Fayol are mutually complementary. One believed that management should not close its ears to constructive Suggestions made by the employees while the other suggested that a good company should have an employee SUBBestion system whereby suggestions which result in substantial time or cost reduction should be rewarded. !dentify and explain the principles of Taylor and Fayol refered to in the above benit PD. (CBSE, Dethi 2014) 56 D Case Studies Mentor in Business Studies-XilSWER: oc prineiples of Payot and Taylor refered to iin the above paragy pitiative’ and ‘Cooperation and Not ndividualiany’, In Anitiative means taking, the ti encouraged to develop and ¢ ould be adopted ity the organ Covpenition and Not bidiesdualisny This principle ban extension of principle of ‘Harmony, Jot Discord’, There should be complete cooperation between tl stead of individuiatism, Conypetition should be replaced by: coe je should an almost equal division of work and responsibility Iso, Management should reward workers for theit st duction in costs. AU the same time, workers should « areasonable demands on the management UESTION 17; iita and Salman completed their MBA and started working ina multinational company at he same level, Both of them worked hard and were happy with their employer, Salman had he habit of back-biting and wrong reporting, about his colleagues to impress his boss. AIL he employees in the organisation knew about it, At the time of pertormance appraisal, the erformance of Nikita was judged to be better than Salman, Even then their boss, Mohammed harif, decided to promote Salman stating that being, a female, Nikita would not be able to andle the complications of a higher post. raph respectively are {step with sell motivation, ‘The workers: should tion system ty out their plans for improvement, Su ation sheen tions whieh tial (2) Identify and explain the principle of multinational company. (8) Identify the values wi yyement which was not followed by this ich are being ignored quoting the lines from the above paragraph. (CBSE, OD 2013) NSWER: (@) The multinational company didn’t follow the Principle of Equity. It emphasizes Kindliness and justice in the behaviour of managers towards workers. No discrimination should be made by them on the basis of caste, creed, gender or otherwise. (b) The two values (i) Honesty: “Wrong, reporting about his colleagues to impress his boss.” (ii) Justice: “At the time of performance appraisal, the performance of Nikita was judged better than Salman. Even then their boss, Mohammad Sharif, decided to promote Salman.” QUESTION 18: ina and Harish are gets 23,000 per month and Harish gets %4,000 per month as salaries for the same working ours. Which principle of management is being violated in this case? Name and explain the principle. (CBSE, Dethi 2006) which are being ignored in the given case are: vpists in a company having the same educational qualifications. Hina ANSWER: The principle of Equity has been violated in this case. It emphasises kindliness and justice in the behaviour of managers towards workers. No discrimination should be made by them on the basis of caste, creed, gender or otherwise. Principles of Management > 57ADDITIONAL QUESTIONS | QUESTION 1; se i velley showrooms dn Jaipur atten ¢ li Radhika opens a jewellry: showroan ae " wet meee Jala ia ata fo perforny hin/her ape a Joby 4 Wane each employer bi train Taian Cle Work into s val ta a i Se Ml With a buyer by niet cael i Pr wiles STi i to give any further discount rete ae hi a Geen My eter awe stant a it, five of her employees ‘i the earlier days ot starting of the business, fi " TT oe special incentive: within q Yt hours ot work, tee rotate ha! promised te give itt od wea Thevetons, atter six months when the busin aon oy, wel, wien gest Sack of thow-emptayees fo Iuiscue nor winnnlinnt, Pueeuve eae icon suutilicta among her camployees, she tends to be more blaned towa: {context of the above ease setlnys a eOtrne n fowelley cy r jueater productivity, tlw diyn () Identity and explain the various pe Wiples OF management that are being, applied hy Radhika by quoting lines from the Parayraph : () ldentity and explain the principle of management which is being, violated by Radhity by quoting tines trons the Paragraph, (9 State any one eteet of the violation of the Principle of management by Radhika ay identitied in pact (b) of the question, ANSWER: (2) The various: principles of Management that are being applied by Radhika are listed below: {f Division of Work: According to Fayol, “The and better work for the Ment of division of work me effort. Specialisation is the most llicient way to tase human effort He advocates that the Principle of division of Work is applicable to all kinds ot Work both technical well as managerial, work into small tasks «l job, “For greater produc ivily, she di ides the: trained to perform his/her special (i) Principte of Contratisation and By vutralisations authority is called centralisation wher sls than one person is Known as decentralisation, here is a need to balance subordinate involvement through decentratisation with managers’ retention of final authority through centralisation.” and each employee The concentration of de ispersal among more According, to Fayol, “rh ision-making ie “The sales Persons are allowed to ¢ lose of 10% discount, Whereas the dec Radhika as the final authority.” (iii) Principle of Dis ipline: Discipline refers lo the obedience employment agreement which are ne According to Payol, dis pling re Agreements and judicious a deal with a buyer by 4 ving a maximum nto give any further di Scount rests with (0 organisational ry for the working of the “quires good superiors at all love application of penalties, “Therefore, after six months when the bus ‘ash bonus to each of these employee: rules and ness was doing well to honour her ( The principle of management which te being violated by I ‘Well, she awarded a ‘ommitment,” Radhika is Equity, 58> Case Studies Mentor In Business Studies-xita oe to Fayol, “Good sense and experience are needed to ensure f emprovees, who should be treated as fairly as possible.” This principle emphasizes on Kindliness and justice s towards workers. The managers against anyone on account of gender, religion, language, caste, in the behaviour of manage! should not discriminate 4 belief or nationality ete, However, when it com be more biased toward: (©) One effect of the viol dissatisfaction Nes to settling the conflicts among her employces, she tends to her female employees. lation of the Principle of Equity is that it may lead to job among the male workers. QUESTION 2: Rajveer works as a plant Superintendent in a carpet making factory. In order to complete the export orders on time, the production manager asks him to make the workers work over time whereas the finance manager is strictly against this practice because it will increase the cost of production. Moreover, Rajveer feels that since the company is manufacturing handmade carpets as well as machine made carpets there is a lot of overlapping of activities. Therefore, there should be two separate divisions for both of them wherein each division should have its own in charge, plans and execution resources. In context of the above case: (@) Identify and explain the principle of management which is being violated. () Also identify the principle of management that Rajveer feels should be implemented in the factory. (©) Give any two differences betw (a) and part (b) respectively. ANSWER: The principle of management which is being violated is stated below: (a) Unity of command: There should be one and only one boss for every individual employee. Dual subordination should be avoided. Fayol felt that if this principle is violated, “authority is undermined, discipline is in jeopardy, order disturbed and stability threatened”. (0) Unity of direction: All the units of an organization should be moving towards the same objectives through coordinated and focused efforts. Each group of activities having, the same objective must have one head and one plan. This will lead to unity of action and coordination. (c) The difference between the principle of Unity of Command and Unity of Direction is given below: een the principle of management as identified in part S.No. Basis Unity of Command Unity of Direction 1. Meaning One subordinate should Each group of activities having receive orders from and should same objective must have one head be responsible to only one and one plan. superior. 2 Aim It prevents dual subordination. _ It prevents overlapping of activities. 3. Implications It affects an individual It affects the entire organization. employee Principles of Management » 59QUESTION 3: in an ff Company. On the firnt qj Neeraj is selected for the post of software developer in Tea Dear tia woul his joining Mehul, his project manager tells Neeraj that « Bahn to mintnw his poweny 4 will come across many such opportunities which may tempt hoe company. Ina individual or family's benefit at the cont of larger general inter Vill raise his atatiere in i situations, he should rather exhibit exemplary behaviour av it wil a on official man the eyes of the company. Also, for interacting, with anyone in the om pany ny, he should adopt the formal chain of authority and communication, In context of the above «: oT aetrr ; yement that Mehul is (@) Identify and explain the varios principles of management that Meht Avising Neeraj to follow while doing, his job, Any two values that Mehul wants to communicate to Nec * Various principles of management that Mehul is advising, Neeraj to follow while ng his job are as follows: a ( Subordination of tniividual tnterest to Ceneral lntereat Through this principle, Fayo) advocates: that in all circumstances, the interests of an organisation should take Priority over the interests of any one individual employee. This is essential because larger interests of the other employeesand the stakeholders ie. owners, shareholders, creditors, debte authorities, customers and the society at Jarge Nene be sacrificed for the interest of any one person, Hor exe mple, Mehul telis Neeraj that he might get tempted to misuse hi, powers for his or his family’s benefit and so he must display exemplary behaviour to raise his stature in the eyes of the company, i) Scalar Chain: According to — yol, the formal lines of authority from highest to lowest ranks are known as scalar chain, He suggests thy “The organisations should have a chain of authority and communication that runs from top to bottom and should be followed by managers and the subordinates.” However, LZ in order to ensure speedy communication during emergencies, shorter route that has been provided. However, the ater on. For example, in the following case, there is one head ‘N’ who has ' authority under her/ him. One line consists of B-C-b).b-p Another nao under °A’ is L-M-N-O-P, If “B’ has to communicate with (0% who is at the sna level of authority, then she/he has to traverse the route [ED-C-B-AcL-M-N-O. The is due to the principle of scalar chain being followed in this situation. Howent) if there is an emergency, then ‘E’ can directly contact ‘O" through ‘Gang Manges shown in the diagram, i (H) The two values that Mehul wants to communicate to Neeraj are: (i) Honesty (ii) Self restraint 60 > Case Studies Mentor in Business Studes Xi faa. Gang plank nergencies, Gang Plank is a Superior has to be informedQUESTION 4: Davinder is a class twelfth commerce student in a reputed school in Punjab. Satinder is his elder brother who is doing his Masters in Hospital Administration from Delhi after completing, his BSc course, During vacations when Satinder comes home, Davinder shows him the business studies project that he is preparing on the topic ‘Principles of Management’. Satinder {ells him that these principles are also a part of MBA course curriculum at the beginner's level as they form the core of management in practice. But he finds these principles different from those of pure science. In context of the above case: (a) Outline the concept of Principles of management. (b) Why does Satinder find the principles of management different from those of pure science? © Why a ae Principles of management form the core of management in practice? caeeremente nS SRY two points highlighting the importance of principles of ANSWER: (a) The principles of management serve a: : a broad and general guideline for the managerial decision making and action. (b) Satinder finds the principles of management different from those of pure science because the management principles are not as rigid as principles of pure science. This is due to the fact that they deal with the human behaviour and thus, need to be applied creatively in the light of given situation. (©) The importance of principles of management is described below: ( Providing managers with useful insights into reality: The principles of management provide the managers with useful insights into real world situations and help them to enrich their knowledge, ability and understanding of the diverse managerial situations and circumstances. It also enables the managers to learn from past mistakes and conserve time by solving recurring problems quickly. (ii) Optimum utilisation of resources and effective administration: The knowledge of management principles enables the managers to foresee the cause and effect relationships of their decisions and actions. As a result, it leads to optimum utilisation of scarce resources by avoiding wastage associated with a trial-and-error approach. Principles of management limit the boundary of managerial discretion so that their decisions may be free from personal prejudices and biases. This facilitates effective administration within the organisation. QUESTION 5: Gurpreet is running a retail mart in Varanasi to provide various types of products of daily use under one roof to the buyers. The employee turnover in his business is very high and he is perpetually on a look out for new staff. The fact of the matter is that he lacks managerial skills and assigns work to his employees on adhoc basis without letting them settle down in a specific work. This approach of his creates a sense of insecurity among the employees and they tend to leave the job very quickly. However, he is a very god fearing person and offers fair wages to his employees so they can afford a reasonable standard of living. In context of the above case: (a) Identify and explain the principle of management which Gurpreet is unable to apply and is perpetually on a look out for new staff. Principles of Management > 61ffers fai is employees so they “He i i and offers fair wages to his emp they can Ofrd« sasotabe sand of vig” Nar and explain the reavant ping ea will has been brought into effect by Gurpreet. ANSWER: is princi anagement which Gurpre, (4) Stability of Personnel: Stability of personnel is Principle tal eee fee i nt is unable to apply and is perpetually on a look out for n ean “Employee turnover should be minimised to maintain orgat one iieny’ Personnel should be selected and appointed after due and rigorous pr ios — fe Placement, they should be kept at their post for a minimum fixed ae So that th Bet time to show results. Any adhocism in this regard Will create instability /insecurity among employees. They would tend to leave the organisation, : (b) Remuneration of Employees: According to Fayol, the overall Pay and compensation should be fair and equitable to both employees and the organisation. The employees should be paid fair wages so that they are able to maintain at least a reasonable standard of living. At the same time, it should be within the paying capacity of the rorpany: This will ensure pleasant working atmosphere and g00d relations between workers and management, QUESTION 6: After finishing her BBA degree course, anya gets a job of Assistant Manager in a retail sere ny hough the reference of her cousin Tasuna whe works in the same company as a Senior Manager. Taruna decides to guide Tanya through her experience by making her aware of the important facts about management in Practice. She tells her that neither the principles of management provide any readymade, Straitjacket solutions to all managerial Problems nor they are not rigid prescriptions, which have t be followed absolutely, In context of the above case : (@) Identify the two features of principles of mana; Paragraph by quoting lines from the paragraph, (®) Why do the principles to all managerial probl. ANSWER: Bement mentioned in the above of Tanagement not provide readymade, straitjacket solutions lems; as follows: Ve paragraph are ( General guidelines: The principles of management are guid real business situations are very complex and dynamic factors, these principles do not provide readymade, managerial problems. But the importance of principles lelines to action, 5 and are a are like different tools serving different purposes, ciples () As the real business situations are very complex and dynamic and are a result g a f may factors, the principles of management not provide readymade, Stratjacket solutigne © all managerial problems. 62 Case Studies Mentorin Business Studies Xi MaanYESTION 7: aj and Simran are Poth qualified eye surgeons and good friends. After obtaining a certificate pf [agge Does © fo persue a career of their own choice. Raj starts an eye care centre nthe tone ih a parte ae joins a government hospital in a small village. They meet after , long ti Party. Raj invites Simran to visit his eye care centre and she accepts his is clinic that there is a fixed place for everything and everyone x ate is no hinderance in the activities of the clinic. Also, Raj ' with “We' in all his conversations with the staff members. Later fon Raj shares with her that he always deals wi age that Srenvane is equal in his eyes. "29° deals with lazy staff sternly to send the message In context of the above case: (a) Identify and explain the y, ariou; ‘inci ij isa i yr the successful manggemen, caTiOuS principles of management that Raj is applying fo f his eye care centre. (0) List any two values that Simran wants t i the society by taking up a eee cue 's to communicate to the society by 1 UP ANSWER: (@ The various principles of mana; management of his eye care centr (i Order: According to Fayol, “1 appropriate time for maxim for everything (everyone) a of orderliness will lead to gement that Raj is applying for the successful e are described below: People and materials must be in suitable places at \um efficiency.” The principle of order states that ‘A place ind everything (everyone) in its (her/his) place’. A sense increased productivity and efficiency in the organization. (ii) Espirit De Corps: According to Fayol, “Management should promote a team spirit of unity and harmony among employees.” A manager should replace ‘I’ with ‘We’ in all his conversations with workers to promote teamwork. This approach will give rise to a spirit of mutual trust and belongingness among team members. It will also reduce the need for using penalties. (iti) Equity: According to Fayol, “Good sense and experience are needed to ensure fairness to all employees, who should be treated as fairly as possible.” This principle emphasizes on kindliness and justice in the behaviour of managers towards workers. The managers should not discriminate against anyone on account of gender, religion, language, caste, belief or nationality etc. (8) The two values that Simran wants communicate to the society by taking up a job in a village are: () Humanity (ii) Concern for poor QUESTION 8: Hritik is desirous of setting up a small factory to manufacture different kinds of eco-friendly packaging materials. He proposes to adopt a logical approach to his business rather than hit and trial method as he knows that this can result in tremendous saving of human energy as well as wastage of time and materials. He plans to adopt paternalistic style of management in practice in order to avoid any kind of class-conflict that may emerge between him and the Workers. Moreover, he plans to seek the opinion of his workers before taking any important decisions and also offers incentives to them for providing valuable suggestions for the business. In context of the above case: (@) Identify and explain the various principle of scientific management that Hritik plans to apply in his business. Principles of Management ® 63(8) List any two values that he wants to communicate to the society by offering || friendly packaging material, ‘ ANSWER: ' ‘ (0) The varios principle of scentife manngertent that Holi plans to apply in his bsg are described below i - ore wa U e bey (0 Science, not Rule of Thunb: taylor believed that th is ua a yang beat Meth to maximise efficiency and it could be developed through scientific stud beats if the manages rely on persia judgment in ateng to the work related problems, it may sulfer from the limitation of a trial and era i 1 works and approach, Therefore, itis important for them to know what works and why i work, For thisy they should aulopt scientific method to substitute the ‘Rule q| Thumb or hit and trial method” throughout the organisal ') Harmony, Not Discond: In the paternalistic style of management, the employer takes cao the needs of employces like a father, Taylor said that any kind of cag SoTRStS Between the workers and the managers were not ood; rather they mag realise that each one is important. Therefore, he emphasised that there should by Sopblete harmony between the management and workers. To achieve this, Taylor Eales for complete mental revolution on the part of both management and workers by transforming their thinking. The management should share the gains of the ii) Caney any with the workers and atthe same time, workers should work had, (69 Cooperation, Not Individualism: ‘Trough this Principle, Taylor suggests that there should be complete cooperation between the workers and the management instead Discord bate This Principle is an extension of principle of ‘Harmony, Not iscord’. Both should realise the Importance of each other, In order to replace the feeling of competition with cooperation, the management should not close its ea to any constructive su ade by the employees, R, a ees, Ratl be rewarded for any of their valuable suggestions sy esis aes eae in costs. Also, the workers should be taken inte confidence by the onan saving Whenever any important decisions are to be taken: oe (©) The two values that Harit wants to communicate to the packaging material are: (0 Concer for environment (i) Sense of responsi QUESTION 9: Study Buddy Pvt.Ltd." is company dealing in stationery items, in order t of excellence and quality in material = company adheres to benchmarks during production. Morcover i Products qitchines, the limited varieties, sizes and dimensions thereby i _ society by offering eco-friendly Identify the technique of scientific management which has been area, Pvt. Ltd.” oie by ANSWER: Standardisation and Simplification of Work is the technique of scientific manag has been adopted by ‘Study Buddy Pvt. Ltd.’ ‘Bement which Standardisation implies devising new varieties instead of the existing ones, 1¢ ee Process of setting standards for every business activity; it can be standardisation of raw material, time, product, machinery, methods or working conditions, These stangeess are the benchmarks which must be adhered to during production, It helps tp reduards Ca 64 Case Studies Mentorin Business Studles-Xilgiver fine oF ee fixed types, sizes and characteristics, establish interchange ability of manufacture paris and Products, determine standards of excellence and quality in materials and of performance of men and machines, simplification aims at eliminating superfluous diversity of products in terms of varieties, giges and dimensions. It not only helps to reduce inventories but also to save cost of labour, achines and tools. Thus it helps to increase tumover by ensuring optimum utilisation of resources. Most large companies like Samsung, Toyota and Microsoft etc, have successfully implemented standardisation and simplification, QUESTION 10: Anshul owns a small scale factory where utility items are prepared from waste material like saper mache items, Paper and cloth bags, decorative material etc. Over the past few weeks, he was observing that the productivity of one of his very efficient worker, Ramdas, is going down. So he decides to probe into the matter and confronts Ramdas one day. On being asked, Ramdas shares with Anshul that he has deliberately slowed down in his work as many of the less efficient workers often pull his leg saying that there is no need for him to be more efficient when everybody is being paid at the same rate. Taking a lesson from this insight, Anshul decides to implement an incentive bonus plan so as differentiate between efficient and inefficient workers. In context of the above case: (a) Name and explain the incentive bonus plan that Anshul may implement so as differentiate between efficient and inefficient workers. (b) State any two values that Anshul wants to communicate to the society by setting up a special type of business. ANSWER: Differential Piece Wage System is the incentive bonus plan that Anshul may implement so as differentiate between efficient and inefficient workers. Differential Piece Wage System is a performance based wage system which was introduced by Taylor so as to distinguish between the workers who were able to achieve the standard or performed above standard from those who performed below standard. For example, it is determined that standard output per worker per day is 10 units and those who made standard or more than standard will get 40 per unit and those below will get 30 per unit. Now an efficient worker making 11 units will get 11 x 40 = %440 per day whereas a worker who makes 9 units will get 9 x 30 = %270 per day. According to Taylor, the difference of 7170 should be enough for the inefficient worker to be motivated to perform better. QUESTION 11: Swaraj is running an office furniture showroom. Most of his clients are businessmen and they prefer to buy goods on credit. Keeping this in mind, he has given the power to the sales manager, Mr. Bhardwaj, to offer a credit period of only 20 days, while negotiating a éeal with a buyer. On a specific day, Mr. Bhardwaj finds that if he can offer a credit period £30 days as. an exception to a prospective buyer, he is likely to finalise a highly profitable deal for the business, So Mr. Bhardwaj requests Swaraj to grant him additional authority br ofeing a credit period of 30 days in the interest of the business. But Swaraj refuses to *tend his authority and as a result, the deal is not finalized. In cont se: oy se ot age el ld responsible for loss of the deal? Why or why not ? Give a Suitable reason in support of your answer. ( Also, explain the related principle. Principles of Management » 65.ANSWER: e deal in the above case as loss of thi er 4 (0) No, Mr. Bhardwaj cannot be held responsible for loss of 1 responsibility. There is <3 he was not given the necessary authority to carry imbalance in authority and responsibilit ity and Responsibility (0) The name of the related principle is Authority an pelience by the virwe of ont’ Authority is the right to give orders and obtain ae cbligation of a person ie Position in’ the organization. Responsibility is ies and skills. There are two Carry out the assigned task to the best of one’s te authority to command, types of authorities, namely the official authority, which A the individual manager and personal authority, which is the authority of | there should be balance Authority is both formal and informal. According to Fayol, afemplayectesviiay between the authority given and responsibility entrusted 2 a i aanoie a he is able to carry out the assigned task. Any kind of imbal ance, in aut ee responsibility is not good for the organisation. If the authority grant ee n employ . is less than what is required, he will ineffective in doing his work. On fe ane if the authority delegated to an employee is more than what is required, he may tend to misuse it. QUESTION 12; Carmato Ltd. is a well known automobile company in India. The production manager of the Or pany believes that one of the prime reasons for the success bf the company is the use of scientific management techniques ‘Lean manufacturing’ in particular. He also shares that the best results come to the company because of effect partnership between a trained and ‘walified management and a cooperative workers and thus there is no need of trade unions, In context of the above case: (a) What do you understand by ‘Lean manufacturing’? (0) Identify and explain the principle of scientific management being described above. (© Differentiate between the terms ‘principles of management’ and management’. ANSWER: (@) Lean manufacturing is a systematic method f manufacturing system without sacrificing productivity. It emphas Wastes of seven types in any type of manufacturing, Process n; waiting time, transportation, processing, - motion inventory manufacturing helps to enhance the quality of Output besides red to reduced production time, 0) The principle of scientific management being described above is Harmony, Not ‘techniques of Harmony, Not Discord: Taylor suggested that any kind Of class the workers and the managers were not good rather the one is important. Therefore, he emphasised that there should between the management and workers, To achieve this Ta) mental revolution on the part of fa eeeement and workers ing the thinking, The management should share the gains of the company, ig their workers’and af the Carne tink workers should work hard, Th ae meee management, should be followed wherein the employer takes cate of the SY! Of employees like a father. 66 P Case Studies Mentor in Business Studies-Xil >(0) The principles of management serve as a broad and general guideline for the manage’ decision ae and action. For example, principle of division of work. Whereas, technique refers to an approach or method, which involves a series of steps to be taken 0 accomplish desired goals, For example, technique of functional foremanship. QuesTION 13: asstudents of a management course Karan and Kunal were asked prepared a project report ca applicability of principles of management in real business situations. In order to conduct the survey Kunal had selected an outlet of a popular chain of fast food restaurant whereas gaan visited a nearby departmental store, When Kunal presented his report to the class, Karan realised that their observations were matching on various grounds. In both the business grits, work is divided into small tasks and cach is performed by a trained employee. A set of rules are predetermined and communicated to the employees for compliance and there is a fixed place for everything and all employees have been allotted individual space. Moreover, the managers encourage a spirit of mutual trust and belongingness among the employees so that the need for imposing penalties is reduced, In context of the above case: @ Identify and explain the various principles of management being described above. (b) How are the principles of management different from values? ANSWER: (@) The various principles of management being described above are as follows: (i Principle of Division of work: According to Fayol, “The intent of division of work is to produce more and better work for the same effort. Specialisation is the most efficient way to use human effort.” He advocates that this principle of division of work to applicable to all kinds of work both technical as well as managerial. (ii) Principle of Discipline : Discipline refers to the obedience to organisational rules and employment agreement which are necessary for the working of the organisation. According to Fayol, discipline requires good superiors at all levels, clear and fair agreements and judicious application of penalties. (ii) Principle of Order: According to Fayol, “People and materials must be in suitable + places at appropriate time for maximum efficiency.” The principle of order states that ‘A place for everything (everyone) and everything (everyone) in its (her/his) place’. A sense of orderliness will lead to increased productivity and efficiency in the organization. (io) Principle of Espirit De Corps: According to Fayol,"Management should promote a team spirit of unity and harmony among employees.” A manager should replace ‘T with ‘We’ in all his conversations with workers to promote teamwork. This approach is will give rise to a spirit of mutual trust and belongingness among, team members. It will also reduce the need for using penalties. (The principles of management serve as a broad and general guideline for the managerial decision making and action. Whereas, Values are the standards set in terms Of suitability or desirability on the basis of perspective and general belief about what is right or wrong. For example, at Infosys, one of the values towards customers is “To Surpass client expectations consistently”. Principles of Management > 67