class 12 business studies Ch 1 notes

Class 12 Ch 1
Concept of Management
Management is the process of getting things done with the aim of achieving goals effectively and efficiently. For management, it is important to be both effective (completing task on time) and efficient (doing the task correctly and with minimum cost).

Objectives of Management
1. Organisational Objectives: They are required to achieve economic goals of the enterprise. Three basic organisational objectives are:
(a) Survival: In order to survive, an organisation must earn enough revenues to cover costs.
(b) Profit: It is essential to meet the costs of business and also cover the business risks.
(c) Growth: To remain in the market, management must exploit fully the growth potential of the organisation, e.g., increase in number of products, capital investment, etc.
2. Social Objectives: These objectives involve the creation of benefit for society. It involves, for example, providing employment opportunities to weaker section of the society, protecting environment by using environmental friendly methods of production, etc.
3. Personal Objectives: They are related to the individual needs of the employees of an organisation, for example, competitive salary, social recognition, etc.

Characteristics of Management
1. Management is a goal-oriented process as it integrates the efforts of different individuals to achieve organisational goals.
2. Management is all pervasive as it is required in all types of organisations whether political, economic or social.
3. Management is multi-dimensional as it involves management of work, people and operations.
4. Management is a continuous process as all the functions of management are performed by all managers on continuous basis.
5. Management is a group activity because accomplishment of organisational goals requires team work and coordinated efforts of group of people.
6. Management is a dynamic function as it adopts itself to the changing environment.
7. Management is an intangible force as it cannot be seen but its presence can be felt when targets are achieved according to plans, employees are happy and satisfied, etc.

Importance of Management
1. Management helps in achieving group goals   by directing the efforts of all the individuals in   the common direction of accomplishing
  organisational goals.
2.  Management increases efficiency as the main motive of manager is to reduce cost
and increase productivity.
3. Management creates a dynamic organisation by helping people to implement changes so that the organisation is able to maintain its competitive edge.
4. Management helps in achieving personal objectives of employees along with organisational objectives through motivation and leadership.
5. Management helps in the development of society by providing better quality goods and services at a reasonable price, generating employment opportunities, adopting new technology, etc.

Nature of Management as Science, Art and Profession Management as a Science
• Management has systematised body of knowledge.
• Management principles have been developed over a period of time and are based on observation and experimentation in different types of organisations.
• It is an inexact science, not a pure science like physics or chemistry. Application of management principles is not universal, have to be modified according to the given situation.

Management as an Art
• There is existence of theoretical knowledge.
• Every manager has his own personalised and unique style of managing things and people.
• A good manager works through a combination of regular practice, creativity, imagination, initiative and innovation.

Management as a Profession
Features of a profession - It has well-defined body of knowledge, restricted entry to a profession, professional association, service motive, ethical code of conduct.
Presently all the characteristics of profession are not present in management but it is on the
path of becoming a profession.

Levels of Management
1. Top Management: It includes Board of Directors, Managing Director, Chairman, etc.
Responsible for the welfare and survival of the organisation.
2. Middle Management: It includes Purchase Manager, Sales Manager, Branch Manager, Plant Superintendent, etc. responsible for implementing and controlling plans and policies framed by top management.
3. Supervisory/Operational Management: It includes Supervisors, Foremen, etc.
Supervisory managers are responsible for implementing policies of the top management communicated to them through middle level management.

Functions of Management
1. Planning: Planning means setting objectives and preparing the plans to achieve them effectively and efficiently.

2. Organising: The organising function involves assigning duties, grouping tasks, establishing authority responsibility relationships and allocating resources needed to carry out a specific plan.
3. Staffing: It means finding the right people for the right job at the right time.
4. Directing: Directing involves issuing orders and instructions, supervision, motivation, leadership and communication.
5. Controlling: Controlling is concerned with comparing actual performance with the standards and taking corrective steps when results deviate from plans.

Coordination
Coordination refers to synchronising the efforts by unifying, integrating and harmonising the activities of different departments and individuals towards the achievement of common objectives.

Characteristics/Nature of Coordination
1. Coordination integrates group efforts – gives common direction to group efforts.
2. Coordination ensures unity of action – acts as a binding force between departments.
3. Coordination is a continuous process – It starts with the planning function and continues till controlling.
4. Coordination is an all pervasive function – It is needed at all levels, in all departments.
5. Coordination is the responsibility of all managers – at the top, middle and lower level.
6. Coordination is a deliberate function – a manager has to coordinate the efforts of different people in a conscious and deliberate manner.

Importance of Coordination
1. Growth in Size: Coordination is required to integrate efforts of all the people in the organisation.
2. Functional Differentiation: Coordination is required to ensure unity of action among interdependent departments such as production, marketing, finance, etc.
3. Specialisation: Coordination is needed to avoid conflict between the specialists and the other members.