CBSE Class 12 Business Studies Revision Notes Chapter 1 - Nature and Significance of Management
Meaning of Management
Management refers to the process of getting the work done efficiently and effectively.
Effectiveness - getting the work done on time
Efficiency - getting the work done with less wastage / less cost
Features / Characteristics of Management
Goal oriented - Management is done to achieve goals of an organisation. In absence of goal, there is no need for management.
Continuous - Management is not a one-time activity. It is required on a regular and ongoing basis.
Pervasive - Management is called pervasive because it is required in all types of organisations and in all departments of an organisation.
Dynamic - Management is dynamic because it has to adapt / adjust itself to the changing environment.
Group activity - Management is a group activity as it involves teamwork of all people working in an organisation.
Multidimensional - Management is called multidimensional because it has three dimensions.
Management of work
Management of people
Management of operations
Intangible force - Management is called an intangible force because it can't be seen or touched but it's presence can be felt.
Objectives of Management
There are three objectives of management:
Organisational objectives -
Organisational objectives include -
It includes
Survival
Profit
Growth
Personal objectives - These objectives relate to the employees of an organisation. For example
Opening schools for children of employees.
Providing medical facilities to employees.
Providing training to employees
Social objectives - These objectives relate to the welfare of society.
For example
Using eco-friendly techniques
Providing employment opportunities in rural areas
Providing good quality products at fair prices to the customers
Importance of Management
Management helps in achieving group goals: Management is needed to direct the efforts of different individuals towards the goals of organisation.
Management helps in achieving personal objectives: Management helps in achieving personal objectives of employees through motivation, good leadership and open communication.
Management helps in achieving social objectives: Managers helps in development of society by fulfilling their social responsibilities.
Management helps in increasing efficiency: Management helps in increasing efficiency through proper utilisation of resources such as men, materials and machines.
Management helps in creating a dynamic organisation: Management helps in creating a dynamic organisation by adapting to the changes in environment.
Levels of Management
Top level management
Middle level management
Lower (supervisory) level management
Top level management
Top level management includes board of directors, president , chief executive officer , managing director etc.
.
Functions of Top-Level Management -
Responsible for success of organisation
Maintaining contact with outside world
Assembling resources
Framing objectives of organisation
Framing policies of organisation
Middle level management
Middle level managers include division or departmental heads such as finance manager, human resource manager, production manager, plant superintendent etc.
Functions of Middle Level Management -
Interpreting policies framed by top level management
Selection of employees for their department
Giving instructions to employees of their departments
Motivating employees of their departments
Cooperating with other departments
Lower level management
Lower level managers include supervisors, foremen, section officer etc.
Functions of Lower Level Management -
Communicating grievances of workers to upper level management
Providing safe and proper working conditions
Ensuring quality of output
Reducing wastage of resources
Resolving disputes of workers
Providing training to workers
Functions of Management
Planning: Planning refers to deciding in advance what to do, how to do and who should do it.
Organising: Organising refers to the process of identification and division of work, departmentalisation, assignment of duties and creating reporting relationships.
Staffing: Staffing refers to filling and keeping filled the job posts in an organisation.
It involves recruitment, selection and training of employees.
Directing: Directing means instructing, guiding, communicating and inspiring people of an organisation.
It includes supervision, leadership, motivation and communication.
Controlling: Controlling refers to the process of comparing actual performance with the standards and taking corrective action, if needed.
Nature of Management
Nature of Management as Art
Art refers to skillful and personalised application of existing knowledge to achieve desired results.
Painting, dancing, singing etc. all are examples of art.
Now let's check whether management is art or not…
Features of Art and Management as Art
Existence of Theoretical Knowledge:
There are lots of books and literature available in the field of art through which it's knowledge can be acquired.
This feature is present in management as there are books and literature available in the field of art.
Personalised Application: Different artists apply their knowledge differently. For example, two actors, two dancers and two musicians will differ in demonstrating their art.
This feature of art is present in management because different managers apply their knowledge differently.
Based on Practice and Creativity: Art requires continuous practice of the existing theoretical knowledge.
This feature is present in management because regular practice is required to become a more effective manager.
Conclusion: Management is an art because all the three features of art are present in management.
Nature of Management as Science:
Science refers to systematic body of knowledge which is acquired on the basis of observation and experiments.
Now, let’s check whether management is science or not...
Features of Science and Management as Science:
Systematic Body of Knowledge: Science has theory and principles. And there are a lot of books available in the field of science.
This feature of science is fully present in management because it also has theory and principles and it's knowledge can be acquired.
Principles based of Experiments : Principles of science are developed on the basis of observation and experiments.
This feature of science is not fully present in management because management deals with human beings and observation of humans can't be done with 100% accuracy.
Universal Validity: Principles of science can be applied in each and every situation.
This feature of science is not fully present in management because principles of management may have to be modified as per the given situation.
Conclusion: Management is a science but it's not an exact/pure science. It can be called as soft or inexact science.
Nature of Management as Profession:
Profession is an economic activity which involves use of special knowledge and skill to serve the people of society.
Now, let's check whether management is a profession or not:
Features of Profession and Management as Profession:
Well defined body of knowledge: There are variety of books and literature available in the field of profession through which it's knowledge can be acquired.
This feature of profession is fully present in management.
Restricted entry: To enter a profession, a person must have the required minimum qualification. For example, to become a lawyer, a person must have a degree in law.
This feature of profession is not present in management as no minimum qualification is required to become a manager.
Professional Association: A profession is regulated by professional association. For example, BAR council for lawyers, ICAI for chartered accountants, medical council for doctors etc.
This feature of profession is not fully present in management.
Code of conduct: In every profession, a code of conduct is developed by its professional association and it is to be followed compulsorily by its members.
This feature of profession is not fully present in management because there is no compulsory code of conduct for managers.
Social Service: The main motive of profession is to serve the society.
This feature of profession is not fully present in management as the main motive of management is to achieve predetermined organisational goals.
Conclusion: Management is in developing phase of profession. It is not a full fledge profession.
Coordination
Coordination is the process of integrating the efforts of different individuals towards organisational goals.
Integrate means to bring together.
Coordination is the process of creating harmony among different activities and resources of an organisation.
Features of Coordination
Integrates group efforts: Coordination integrates efforts of different individuals towards organisational goals.
Ensures unity of efforts: Coordination ensures unity among different activities of an organisation.
Continuous: Coordination is not a one-time activity, but is required on a regular and ongoing basis.
Pervasive: Coordination is needed in all types of organisations and at all levels and departments of an organisation.
Responsibility of all levels of managers: All the three levels of management i.e. top, middle and lower levels are responsible for coordination.
Deliberate: Coordination does not come on its own. It has to be planned by management.
Need or importance of coordination
Growth in size: When an organisation grows, the number of employees working also increases. Coordination is needed to resolve the conflicts among the employees of an organisation.
Functional differentiation: There are various departments in an organisation such as finance department, marketing department, production department and purchase department. Coordination is needed to resolve the conflicts among the various departments of an organisation.
Specialisation: Coordination is needed to resolve the conflicts among various specialists working in an organisation.
Coordination is called as an essence of management
Coordination is called as essence of management because:
Coordination is required at all levels of an organisation:
At Top level management - it is essential to coordinate activities of an organisation.
At Middle level management - it is essential to coordinate activities within the departments and with other departments.
At Lower level management - it is essential to coordinate activities of workers.
Coordination is required in all functions of management:
At planning stage- coordination is required among various plans of an organisation.
At organising stage- coordination is required among various sources and also between authority, responsibility and accountability.
At staffing stage- coordination is required between skills of an employee and job given to him.
At directing stage- coordination is required between superiors and subordinates and among orders, instructions and suggestions.
