Business Studies Test - 2

The correct answer is It is a personalised application.

Key Points

• ​Coordination is the force that binds all the other functions of management.
• It is the common thread that runs through all activities such as purchase, production, sales, and finance to ensure continuity in the working of the organisation.
  • Coordination integrates group efforts: Coordination unifies unrelated or diverse interests into purposeful work activity.  
  • Coordination ensures unity of action: The purpose of coordination is to secure unity of action in the realisation of a common purpose. 
  • Coordination is a continuous process: Coordination is not a one-time function but a continuous process. I
  • Coordination is the responsibility of all managers: Coordination is the function of every manager in the organisation.
  • Coordination is a deliberate function: A manager has to coordinate the efforts of different people in a conscious and deliberate manner.  
• Personalised application is a basic feature of Management as an Art. 
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Additional Information 

• ​Coordination is the force that binds all the other functions of management.
• It is the common thread that runs through all activities such as purchase, production, sales, and finance to ensure continuity in the working of the organisation.
• Coordination is sometimes considered a separate function of management.
• It is however, the essence of management, for achieving harmony among individual efforts towards the accomplishment of group goals.
• Each managerial function is an exercise contributing individually to coordination.
• Coordination is implicit and inherent in all functions of an organisation.

The correct answer is All of the above.

Key Points

• Importance of Coordination: Coordination is important as it integrates the efforts of individuals, departments and specialists.
  • Growth in size: As organisations grow in size, the number of people employed by the organisation also increases.
  • Functional differentiation: Functions of an organisation are divided into departments,
  • Specialisation: Modern organisations are characterised by a high degree of specialisation. Specialisation arises out of the complexities of modern technology and the diversity of tasks to be performed.
• ​Coordination is the force that binds all the other functions of management.
• It is the common thread that runs through all activities such as purchase, production, sales, and finance to ensure continuity in the working of the organisation.

The correct answer is None of the above .

Key Points

• Management is multidimensional:
• Management is a complex activity that has three main dimensions.
• These are:
  • Management of work: All organisations exist for the performance of some work. 
  • Management of people: Human resources or people are an organisation’s greatest asset. it implies dealing with
    employees as individuals with diverse needs and behavior. 
  • Management of operations: Management of operations: No matter what the organisation, it has some basic product or service to provide in order to survive. 

The correct answer is Both 1 and 2. 

Key Points

• For management, it is important to be both effective and efficient.
• Effectiveness and efficiency are two sides of the same coin.
• But these two aspects need to be balanced and management at times, has to compromise with efficiency.
• For example, it is easier to be effective and ignore efficiency i.e., complete the given task but at a high cost.
• At times, a business may concentrate more on producing goods with fewer resources i.e., cutting down cost but not achieving the target production.
• Consequently, the goods do not reach the market and hence the demand for them declines and competitors enter the market. 

The correct answer is It helps in practice and creativity.

Key Points

• Importance of Management
• Having understood that management is a universal activity that is integral to any organisation we now examine some of the reasons that have made management so important,
  1. Management helps in achieving group goals.
  2. Management increases efficiency.
  3. Management creates a dynamic organisation. 
  4. Management helps in achieving personal objectives.
  5. Management helps in the development of society.
• ​Practice and creativity is an attribute of Mangement as an Art. 

The correct answer is Middle Management.

Key Points

Levels of Management 

• Management is a universal term used for certain functions performed by individuals in an enterprise who are bound together in a hierarchy of relationships. 
• Top Management: They consist of the senior-most executives of the organisation by whatever name they are called. They are usually referred to as the chairman, the chief executive officer, chief operating officer, president and vice-president.
  • Top Management basic task is to integrate diverse elements and coordinate the activities of different departments according to the overall objectives of the organisation.
  • These top level managers are responsible for the welfare and survival of the organisation.
  • They analyse the business environment and its implications for the survival of the firm. Hence option 4 is correct. 
• Middle Management: is the link between top and lower level managers.
  • They are subordinate to top managers and superior to the first line managers.  
  • Middle management is responsible for implementing and controlling plans and strategies developed by top management. At the same time they are responsible for all the activities of first line managers.
• Supervisory or Operational Management: Foremen and supervisors comprise the lower level in the hierarchy of the organisation. Supervisors directly oversee the efforts of the workforce. Their authority and responsibility is limited according to the plans drawn by the top management. 

The correct answer is ​Directing.

Key Points

Functions of Management 

• Management is described as the process of planning, organising, directing and controlling the efforts of organisational members and of using organisational resources to achieve specific goals.
  • Planning is the function of determining in advance what is to be done and who is to do it.
  • Organising is the management function of assigning duties, grouping tasks, establishing authority and allocating resources required to carry out a specific plan. 
  • Staffing simply stated, is finding the right people for the right job. 
  • Directing involves leading, influencing and motivating employees to perform the tasks assigned to them. 
  • Controlling is the management function of monitoring organisational performance towards the attainment of organisational goals. 

The correct answer is ​​Systematised body of knowledge.

Key Points

• Management as a Science : is a systematised body of knowledge that explains certain general truths or the operation of general laws.
• The basic features of science are as follows:
  1. Systematised body of knowledge: Science is a systematic body of knowledge. Its principles are based on a cause and effect relationship. 
  2. Principles based on experimentation: Scientific principles are first developed through observation and then tested through repeated experimentation under controlled conditions. 
  3. Universal validity: Scientific principles have universal validity and application
• Management as an Art:  Art is the skillful and personal application of existing knowledge to achieve desired results.
• It can be acquired through study, observation and experience.
• Since art is concerned with personal application of knowledge some kind of ingenuity and creativity is required to practice the basic principles learnt.
• The basic features of an art are as follows:
  1. Existence of theoretical knowledge: Art presupposes the existence of certain theoretical knowledge. 
  2. Personalised application: The use of this basic knowledge varies from individual to individual. Art, therefore, is a very personalised concept
  3. Based on practice and creativity: All art is practical. Art involves the creative practice of existing theoretical knowledge.

The correct answer is Personalised application.

Key Points

• Management as an Art:  Art is the skillful and personal application of existing knowledge to achieve desired results.
  • It can be acquired through study, observation and experience.
  • Since art is concerned with personal application of knowledge some kind of ingenuity and creativity is required to practice the basic principles learnt.
  • The basic features of an art are as follows:
    1. Existence of theoretical knowledge: Art presupposes the existence of certain theoretical knowledge. 
    2. Personalised application: The use of this basic knowledge varies from individual to individual. Art, therefore, is a very personalised concept
    3. Based on practice and creativity: All art is practical. Art involves the creative practice of existing theoretical knowledge. 
• Management as a Science: is a systematised body of knowledge that explains certain general truths or the operation of general laws.
  • The basic features of science are as follows:
    1. Systematised body of knowledge: Science is a systematic body of knowledge. Its principles are based on a cause and effect relationship. 
    2. Principles based on experimentation: Scientific principles are first developed through observation and then tested through repeated experimentation under controlled conditions. 
    3. Universal validity: Scientific principles have universal validity and application

The correct answer is Survival.

Key Points

• Organisational Objectives: Management is responsible for setting and achieving objectives for the organisation.
• It has to achieve a variety of objectives in all areas considering the interest of all stakeholders including, shareholders, employees, customers and the government.
• The main objective of any organisation should be to utilise human and material resources to the maximum possible advantage, i.e., to fulfill the economic objectives of a business.

These are survival, profit and growth.  

Survival: The basic objectives of any business are survival.

• Management must strive to ensure the survival of the organisation.
• In order to survive, an organisation must earn enough revenues to cover costs.

Profit: Mere survival is not enough for business.

• Management has to ensure that the organisation makes a profit.
• Profit provides a vital incentive for the continued successful operation of the enterprise. Profit is essential for covering costs and risks of the business.

Growth: A business needs to add to its prospects in the long run, for this it is important for the business to grow.

• To remain in the industry, management must exploit fully the growth potential of the organisation.
• Growth of a business can be measured in terms of sales volume increase in the number of employees, the number of products or the increase in capital investment, etc.
• There can be other indicators of growth.