internal assessment examination-1

7/27/2019 Internal Assessment Examination-1

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INTERNAL ASSESSMENT EXAMINATION I

PRINCIPLES OF MANAGEMENT

PART A (5X2=10)

(Answer the ALL questions)

1. Enlist the roles of functional foremanship.

Functional Foremanship: According to Taylor, one Supervisor cannot be an expert in all aspects

of work supervision. He suggested the system of functional Foremanship in which eight

supervisors supervise a workers job. Four of them are concerned with the planning of work in the

factory office and the other four are involved in the execution of work at the shop floor.

2. Differentiate between management and administration

S.No Administration Management1 Legislative & determination function Executive Function

2 Determination of objectives & policies Implementation of Policies

3 Provides a sketch of the enterprise Provides the entire body

4 Influenced mainly by public opinion &

other outside force

Influenced mainly by administrative

function

5 Mainly top level function involves

thinking & planning

Mainly middle level function involves

doing and acting

3. Enlist the principles of scientific management according to F.W.Taylor.

Principles of Scientific Management

Science not rule of thumb

Harmony not discord

Co-operation not individualism

Maximum output in place of restricted output

Development of each individual to his greatest efficiency and prosperity

Mental Revolution Workers and Management, Workmen towards their work,

their fellowmen and towards their employees.

4. Mention the characteristics of good plan.

Features of a good plan

1. Based on clearly defined objectives

2. Simple, easily understandable3. Flexible or adaptable to changing conditions


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4. must be balanced in all respects

5. must provide standards for the evaluation of performance and actions

6. It should be economical

7. It should be practicable

5. Differentiate between strategic and operational planning.

S.No Strategic Planning Operational Planning1 Lays down major goals and Policies of

the Organisation

Decides the use of resources in day

to day operations2 Done at higher levels of Management Done at lower level of Management3 Long term in nature Short term in nature4 Broad and general Detailed and specific5 Based on long term forecast and

appraisal of Environment

Based on past experience

PART B (1X8+2X16=40)

(Answer the ALL questions)

06. Discuss the steps involved to make MBO effective and state its merits and demerits. (8)

Management by Objectives (MBO)

MBO is a comprehensive managerial system that integrates many key managerial activities in

a systematic manner and that is consciously directed towards the effective and efficient

achievement of Organisation and individual Objectives.

Process of MBO

1. Setting preliminary Objectives

2. Clarifying Organizational roles

3. Setting subordinates Objectives

4. Recycling Objectives

How to set Objectives

1. Quantitative & Qualitative

2. Setting Objectives in Government.3. Guidelines for setting Objectives

Benefits of MBO

Improvement of managing

Clarification of Organisation

Encouragement of Personal commitment

Development of Effective control

Weakness of MBO


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Failure to teach the philosophy of MBO

Failure to give guidelines to goal setters

Difficulty of setting goals

Emphasis on short run goals

Danger of Inflexibility07. (a) Explain the fourteen principles involved for management process according to Henry

fayol. (16)

Classification of Business Activities

According to Fayol all activities of a business enterprise could be divided into six groups:

Technical (Production or manufacturing)

Commercial (Buying, selling and exchange)

Financial (Search for and optimum use of capital)Security (Protection of property and persons)

Accounting (Record keeping, costing, statistics)

Managerial (Planning, organizing, commanding, coordinating and controlling)

Elements of Management

Fayol classified the elements or functions of management as follows:

Planning (to foresee and provide means for the future)

Organizing (to provide a business everything useful to its functioning raw materials, tools,capital and personnel)

Commanding (maintaining activity among personnel)

Coordinating (unifying and harmonizing all activity and efforts)

Controlling (seeing that everything occurs in conformity with established rules and expressed

command)

Universal Principles of Management

Fayol gave fourteen basic principles of management. Fayol cautioned that these principles are

flexible guidelines and should not be considered as rigid rules. He pointed out that these principles

have by and large universal application.

Managerial Qualities and Training

Fayol identified the following qualities of an effective manager:

Physical (health,vigour and address)

Mental (ability to understand and learn, judgment and adaptability)

Moral (energy, firmness, willingness to accept responsibility, initiative, loyalty, tact and dignity)


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General education (general acquaintance with matters not, belonging exclusively to the function

performed)

Special knowledge (peculiar to the function being performed)

Experience (knowledge arising from work proper)

7. (b) Write short notes on:

(a) Sole proprietorship (4)

Sole proprietorship

The individual entrepreneur supplies the entire capital, employs labour and machines. Individual

uses his own skill in the management of affairs and is solely responsible for the good or bad result

of its operation and working

Merits

1. Simplest form of business

2. Least legal complication

3. Quick decision

4. Maximum Profit

5. Personal Care

6. Quality product

7. Minimum wastage

8. Flexible business

(b) Partnership (4)

Partnership

Two or more persons come together and start a business with their own funds, the parties agree to

share the profits as well as bear the losses in the agreed proportion. The formation and

management of partnership organization is governed by the Indian Partnership Act, 1932.

Merits

1. Has larger financial resources

2. greater personal contacts of the partners gives more customer base and benefits

3. Persons of different skills and abilities can work for betterment of Organisation

4. Less expenditure per partner is involved in forming partnership Organisation

5. Loss will be divided among the partners

(c) Joint stock companies. (4)

Joint Stock Company Capital is contributed by a large number of people in the form of shares

of different values.


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Private Ltd Company can be established with two to fifty members. The maximum number of

membership is limited to 50. When this type of Organisation expands beyond certain limit, it can

restrict its liability by registering the firm as a limited company. The company is registered under

Indian Company act 1956.

Public Ltd Company the minimum number of members required are 7 and there is no upper

limit. Such companies offer shares to general public. Public Ltd companies are supervised and

controlled by the Government to protect the interest of Share holder public. The company is

governed by an elected body called board of directors.

Merits

1. The shareholders bears no risk as the liability is limited

2. large scale business can be undertaken

3. Take advantage of economies of scale in production because management can employ

specialized labour, can use latest machinery and thus can achieve large scale production at low

cost.

4. It is not affected by the retirement of any share holder hence the existence of Organisation is

permanent in nature.

5. It works on democratic principles, which results in economy and efficiency.

Co-operative Enterprises

Co-operation is a form of Organisation where persons irrespective of caste, creed and religion,

voluntarily associate together as human beings. It is based on the democratic principles andfunctions for the welfare of the public at large. It protects the interest of consumer as well as that

of small producers.

Features

1. Voluntary Organisation

2. Open Membership

3. Common purpose / Interest

4. Democratic Management5. Not profit oriented

(d) Different roles of managers (4)

Roles of a manager ( Mintzberg)

1. Interpersonal Role - Interacting with people inside and outside the Organisation

Figurehead as a symbolic head of an organisation, the manager performs

routine duties of a legal nature

Leader Hiring, Training, motivating and guiding subordinates Liason - Interacting with other managers outside the organisation to obtain


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favours and information

2. Informational Role Serving as a focal point for exchange of Information

Monitor Seeks and receive information concerning internal and external

events so as to gain understanding of the Organisation and its environment.

Disseminator Transmits information to subordinates, peers and superiors within the

Organisation

Spokesperson Speaking on behalf of the Organisation and transmitting information on

Organisation plans, policies and actions to outsiders.

3. Decisional Role Makes important decision

Entrepreneur Initiating changes or improvements in the activities of the Organisation

Disturbance handler - Taking charge and corrective action when Organisation faces unexpected

crises Resource allocator Distributing Organizations resources like money, time, equipment and

labour

Negotiator Representing the Organisation in bargaining and negotiations with outsiders and

insiders

08. (a) Explain in detail about the modern classical approaches and state its limitations. (16)

APPROACHES TO MANAGEMENT

Modern management has developed through several stages or approaches. These approachesto the study of management may be classified as under:

1. Classical Approach

2. Behavioural Approach

3. Management Science Approach

4. System Approach

5. Contingency Approach

The Classical Approach

The classical or empirical approach is based on the following tenets:

1. Management is a process consisting of interrelated functions performed to achieve the desired

goals.

2. From the experience of managers in different organizations, principles or guidelines can be

derived.

3. These principles are basic truths, which can be applied, in different organizations to improve

managerial efficiency.


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- In light of the market, competition, what customer wants our strengths and weakness?

2. Setting Objectives or goals

- Where we want to be and we want to accomplish and when

3. Considering Planning Premises

- In what environment. Internal or External will our plan to operate?

4. Identifying alternatives

- What are the most promising alternatives to accomplish our objectives?

5. Comparing alternatives in light of goals

- Which alternative will give us the best chance of meeting our goals at the lowest cost and

highest profits?

6. Choosing an alternative

- Selecting the course of action we will pursue

7. Formulating supporting plan

- Such as plans to buy equipment, buy materials, hire and train workers. Develop a product.

8. Numberizing plans by making budgets

- Developing such budgets as volume and price of sales operating expenses necessary for plans

expenditure for capital equipment

(ii) Types of plans (4)

Types of Plans

1. Purposes or Missions identifies the basic function or task of an enterprises or agency or any part of it. The purpose of business generally is the production and distribution of goods and

services.

2. Objectives or goals are the ends towards which activity is aimed, they are the results to be

achieved. They represent not only the end point of planning but the end toward which organizing,

staffing, leading and controlling are aimed.

3. Strategies Strategies are grand plan. The most common usage of the terms is general

programs of action and deployment of resources to attain comprehensive objectives. Thedetermination of the basic long term objectives of an enterprises and the adoption of courses of

action and allocation of resources necessary to achieve these goals.

4. Policies are general statements or undertakings which guide or channel thinking in decision

making. Not all policies are Statements; they are often merely implied from the actions of

managers.

5. Procedures are plans that require method of handling future activities. They are guides to

action, rather than to thinking, and they detail the exact manner in which certain activities must be

accomplished. They are chronological sequences of required actions.


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6. Rules spell out specific actions or non-actions, allowing no discretion.

7. Programs are a complex of goals, policies, procedures, rules, tasks assignments, steps to be

taken, resources to be employed and other elements necessary to carry out a given course of

action; they are ordinarily supported by budgets.

8. Budgets is a statement of expected results expressed in numerical terms. Referred as

numberized program. The financial operating budget is often called a profit plan

(iii) Steps in formulating successful strategy (4)

1. Based on clearly defined objectives

2. Simple, easily understandable

3. Flexible or adaptable to changing conditions

4. must be balanced in all respects

5. must provide standards for the evaluation of performance and actions

6. It should be economical

7. It should be practicable

8. Prepared with the consultation of concerned persons

9. Should be clear, specific and logical

10. Should be capable of being controlled

(iv)Types of policies (4)

1. External & Internal policies

External policiesECONOMIC ENVIRONMENT

Includes the type of economic system that exist in the economy

The nature and structure of the economy, the business cycle, the fiscal, monetary and financial

policies of the government, foreign trade and foreign investment policies of the government.

The type of economic system, that is socialist, capitalist or mixed provides institutional

framework with in which business firm have to work.

(i) SOCIAL AND CULTURAL POLICIES- Members of a society yields important influence over business firms.

- Activities of business firm may harm the physical environment and impose heavy social costs.

- Business should consider the social implication of their decisions.

- Social responsiveness the ability of a corporate firm to relate its operations and

- Policies to social environment in way that are mutually beneficial to the company and society

at large.

- Social responsibility / social responsiveness related to ethics.(ii) POLITICAL AND LEGAL ENVIRONMENT POLICIES


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Closely related to government.

Political philosophy of the government yields a great influences over business policies.

(iii) TECHNOLOGICAL ENVIRONMENT POLICIES

The nature of technology used for production of goods and services in an important

Factor responsible for the success of a business firm.

The improvements in technology raise the total factor productivity of a firm and

Reduce unit cost of output.

Technological environment affects the success of firms and the need for

Technological advancement cannot be ignored.

(iv) DEMOGRAPHIC ENVIRONMENT POLICIES

Includes the size and growth of population, life expectancy of the people rural urban

Distribution of population the technological skills and educational levels of labour force.

Since new workers are recruited from outside the firm, demographic factors are considered as

parts of external environment.

The skills and ability of a firms workers determine to a large extent how well the

Organisation can achieve its mission.

NATURAL ENVIRONMENT POLICIES

- In the ultimate source of many inputs such as raw materials, energy which business firms use in

their productive activity.

- Availability of natural resources in a region a country is a basic factor in determining business

activity in it.

- It includes geographical and ecological factors such as minerals and oil reserves, water

and forest resources wealth and climatic conditions, port facilities are all highly significant for

various business activities.

- Not the availability of natural resources alone, but also the technology and ability to being them

in use that determines the growth of business and the economy.

INTERNAL ENVIRONMENT POLICIES

Internal factors are to good extent controllable factors because the firm can change or modify

these factors to improve its efficiency.

VALUE SYSTEMS

Means the ethical belief that guides the organization in achieving its mission and objective.

The value system of a business organisation makes an important contribution to its success


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and its prestige in the world of business.

Value system of a business firm has an important bearing on its corporate culture and

determines its behaviour towards its employees, shareholders and society at large.

Infosys Our corporate culture is to achieve our objectives in environment of Fairness,

honesty, transparency and courtesy towards our customers employees, Vendors and society at

large

internal assessment examination-1

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