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OMTEX CLASSES ORGANISATION OF COMMERCE AND MANAGEMENT

Achieve success through OMTEX CLASSES The home of text1

OMTEX CLASSES

6th years of success

ORGANISATIONOFCOMMERCE

ANDMANAGEMENT

NAME : - ______________________________

STANDARD: - S.Y.J.C (Second year junior college)

CLASSES : - OMTEX CLASSES

FOR PRIVATE CIRCULATION ONLY

You dont know what you can do until you try

IF YOUARESATISFIED WITHOURTEACHINGTELLTOOTHERSIFNOTTELLTOUS

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OMTE L E ORGANISATION OF COMMERCE AND MANAGEMENT

Achi success through OMT E

C LASSE S The home of text2

1. FEATURES OF SOLE TRADING CONCERN?

Meaning: Sole trading concern is the oldest form of commercial organisation. Sole means oneperson, so a sole trading concern is an organization where all the business activities are controlled

and managed by one man. And he is also solely responsible for the all the debts and risk of the firm.

Definition:A sole trader is a person who trades on his own account rather than in partnership or asa member of a company.

Defined by (Michael Greener)

The following are some of the features of a sole trading concern.OMTE

1. Single ownership2. Unlimited liability3. Limited government control4. Business secrecy5. Flexibility6. No sharing of profit and losses7. Absence of Legal status

THE ABOVE IMPORTANT FEATURES ARE EXPLAINED BRIEFLY DETAIL IN UNDER

1. Single ownership: The sole trader is a single owner of the organization. The sole trader owns allthe assets and property of the business. The sole trading concern is often referred (said) as one

man show

2. Unlimited liability: The liability of the sole trader is unlimited. This means he is alone responsiblefor all the risks and debts of the firm.

3. Minimum government control: Sole trading concern is less affected by government control. Thisis because, there are almost no legal formalities are required to start or close down a business.

4. Business secrecy: The sole trader can maintain complete business secrecy. He needs not to publishany accounts and reports to any body. Competitors cannot easily get business secrets and

information of the sole traders activities.

5. Flexibility: Sole trader enjoys maximum flexibility. He can take right decision at the right timedepending upon the situation. At any time, he need not have to consult with anyone because he is asingle owner of his business.

6. No sharing ofprofit and losses: There is a direct relationship between efforts and rewards. Thisresults in best possible efforts on the part of sole trader. Therefore, he can enjoy all the profits ofhis business.

7. Absence ofLegal status: - Legally, the sole trader and his business concern are one and the samein the eyes of law. The sole trader and his business cannot be separated from each other. So the

sole trader lacks legal status.

2. FEATURES OF JOINT HINDU FAMIL BUSINESS?

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OMTE CLAS SES ORGANISATION OF COMMERCE AND MANAGEMENT

Achieve success through OMT E


Meaning: -The joint Hindu family business firm is a distinct form of business organization existing

only in India. It comes into existence by the operation of Hindu law, via Hindu Succession Act, 1956.

The business of joint Hindu family is controlled and managed by the eldest male member of the

family who is known as Karta and other members of the family are called as co-parcener .

Following is the features of Joint Hindu Family business

1. Joint ownership2. Limited liability of co-parceners3. Unlimited liability of karta4. Minimum government control5. Business secrecy6. Flexibility7. Quick Decision Making

The above Import features are briefly explained as under.

1. Joint Ownership: - The business is jointly owned by all the members of a joint Hindu family.Three successive generations inherit the business by reason of their birth in the family.

2. Limited Liability of Co-parceners: - The joint owners i.e. the co-parceners liability is limited tothe extent of their share in the family business.

3. Unlimited Liability of Karta: -The liability of the karta is Unlimited. This is because, He is total authority to take decisions. He is the leader or head of the joint Hindu family. (OMTE CLASSES) He is liable to pay the dues out of his personal assets, so, the Liability of the karta is

unlimited.

4. Minimum Government Control: - This type of business is subject to less government control.This is because there is less legal formalities are required .Hence; the karta can start a new

business or close down the existing one without much legal formalities.

5. Business Secrecy: - There is a great deal of business secrecy. This is because the joint Hindufamily business need not have to publish accounts and other data to any outside persons.

6. Flexibility: - This type of business offers a good deal of flexibility in business operations. Thekarta can expand the business, change the line of the business, or even close down the business ifthe situation so demand.

7.Quick Decision Making: - -In this type of business, there can be quick decision making. This isbecause the karta can take quick decisions with or without consultation with the co-parceners.

8. Absence of Legal Status: -The joint Hindu family business does not have any legal status. Themembers of the joint Hindu family are also not treated as separate entities. The business activities

of this organisation are monitored by the Hindu Law, 1956.

3. FEATURES OF PARTNERSHIP FIRM?

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Meaning: - Partnership firm is a voluntary association of two or more who contribute their capital and

services, and share the profits and losses in an agreed proportion.

Definition: - Partnership is the relation between persons who have agreed to share the profits of a

business carried on by all or any of them acting for all. (Section 4 of the Indian Partnership Act,

1932.)

Following is the features of Partnership firm

1. Joint ownership2. Agreement3. Lawful business4. Unlimited liability5. Business secrecy6. Sharing of profit and losses7. Number of partners

The above Import features are briefly explained as under

1. Joint Ownership: The partnership firm is jointly owned by the partners. The partners have to usethe partnership property only for business purpose and not for personal purpose .

2. Agreement: - Partnership is an outcome of an agreement between two or more persons toconduct a business with a view to earn profit. The agreement may be oral or written. It is alwaysadvisable to have written agreement.

(OMTE

CLASSES)

3. Lawful business: - The partnership firm must undertake only that business is which permitted bylaw. They must conduct lawful business only and they cannot undertake unlawful business . forex, sale of illegal arms. Or indulge in smuggling business.

4. Unlimited Liability: -The liability of each partner is joint several and unlimited as per the Indianpartnership Act 1932. all the partners is jointly liable along with other partner for the debt of the

firm

5. Business Secrecy: -unlike sole trading concern, a partnership firm lacks complete businesssecrecy. This is because there are several partners and some partners may leak out the business

information to outsiders.

6. Sharing of Profit and Losses: - The partners agree to share the profits among themselves in acertain proportion. The agreed proportion depends upon the amounts of capital contributed.

7. Number of Partners: - A partnership must have a Minimum of two Persons. The maximumpersons in the case of banking business is Ten and in the case of ordinary partnership (other than

banking business), the Maximum number of partner is Twenty.

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4. FEATURES OF JOINT STOCK COMPANY?

Meaning: -A Joint stock is an incorporated association, which is an artificial person, having

independent legal status with a perpetual succession, a common seal, a common capital of

transferable shares carrying limited capital. In other words, Joint Stock Company is a business

organization organized and owned by shareholders but managed by directors. But the directors musthave to purchase the Qualification shares with in two months form the date of his admission.

Definition: - PROF. (H.L.Haney)A joint stock company is a voluntary association of individual

for profit, having its capital divided into transferable shares, the ownership of which is the conditionof membership.

Following is the features of Joint Stock Company

1) Artificial person2) Incorporated association3) Perpetual succession4) Common seal5) Limited liability6) Large membership7) Voluntary Association

(OMTE

CLASSES)

The above important features are explained briefly as under:

1. Artificial Person: - A company is an artificial person created by a law, it has non-physicalexistence, but it has legal existence. Like human being, it can acquire property, enter into a

contract, and sign documents, take legal action, etc,

2. Incorporated Association: - Every company in India has to be registered under the Indiancompanies Act, 1956. Registration or incorporation gives birth to a company. On registration, itgets a separate identity.

3. Perpetual Succession: A company has a perpetual succession. It means that the company has along and stable life. Its existence is not affected by death, insolvency or insanity of its members.

4. Common Seal: - A company is an artificial person, and as such, it has to sign documents andother papers. However, it cannot sign as a human being and, therefore, the common seal serves as

its signature. The common seal remain in the custody of the Board of Directors

5. Limited Liability: -The liability of the members of the joint stock company is limited to theextent of the Shares Purchased by them. If the shares are fully paid, the member is not liable for

any debts of the company.

6. Large Membership: - A joint stock company enjoys large membership. This is because, in a private company, the minimum members are two maximum members can be fifty. In a Publiccompany, the minimum members are Seven and there is no Maximum limit.

7. Voluntary Association: - A company is a voluntary association of persons. Any person competentto enter into a contract can become its member. To be a member, a person should buy or own theshares of the company. A person can terminate is membership form the company by transferring hisshares.

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5. FEATURES OF CO-OPERATIVE SOCIETY?

Meaning: -A Co-operative society is a voluntary association of people who come together on the

basis of unity and equality to protect and promote their common economic interest.

Definition: -It is an association of the weak who gather together for a common economic need and

try to lift themselves from weaknesses into strength through business organization [Talmaki]

y Following is the features of co-operatives: (OMTE CLASSES)

1. Service motive

2. Limited Liability

3. Stability:

4. Voluntary associations

5. Equal voting rights

6. Open Membership7. Lack of Secrecy

1. Service motive: The main aim of a co-operative society organization is to render service to thepeople. It is a service-oriented organization. It is mainly formed for promotion of welfare of the

society.

2. Limited Liability: In a co-operative society, the liability of each member is limited. The liabilityof the member is limited to the face value of shares purchased by them.

3. Stability: The co-operative society enjoys a stable life. There is continued existence. The societysurvives even if some members resign or leave the society. Because it is a corporate (public)

body.

4. Voluntary associations: co-operative society is a voluntary association of people who cometogether on the basis of unity and equality to protect and promote their common economic

interest. The individual joins the cooperative society on his free will.

5. Equal voting rights: - All members are treated equal. Equal voting rights are given to all. Everymembers has one voting rights only, as the society follows the principal of one man one vote.Voting by proxy is not allowed.

6. Open Membership: - Normally, membership is open to all those who are willing to join the co-operative. There is no restriction of caste, creed, race, religion, etc. At Least 10 Members arerequired to form a Co-operative Society.

7. Lack of Secrecy: - The co-operative Lacks secrecy. This is because, the account are madeavailable to the members and others. It is difficult to maintain business secrecy in a cooperativeorganization.

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6. NATURE/CHARACTERISTICS/FEATURES OF MANAGEMENT.

Meaning: -

The survival and success of an organisation largely depends upon the quality of management. Some

organisation prospers and progress not only in good times but also during tough times, but others fails

even during good times. Therefore, it is vital for every organisation to have dynamic and dedicated

managers.

Definition: - (write any one or two definition as per your convenience)To manage is to forecast and to plan, to organise, to command, to coordinate andto control. (Henri Fayol)

Management is the art of getting things done through and with people in formallyorganised groups.(Harold Koontz)

Following are the some of the important features/characteristics ofMANAGEMENT

1. Management is a process: - Management is a process undertaken by managers to attain objectives.The management process involves:

Planning activities Organizing resources Directing subordinates, and Omtex Controlling activitiesThe process of management is continues is nature. As long as the organisation exists, there is aneed to achieve goals, and therefore, there is a need for managerial process on a continuous basis.

2. Group Activity: - proper management requires team work. The combined efforts of all themanagers bring success to the organisation. A single manager, however, capable, may not be able

to attain organisational goals without the support of other managers.

3. Involves Getting Things done through people : -Management involves getting things donethrough the people in the organisation. To get the work done, managers need to:

a. Lead the subordinates b. Communicate effectively, and c. Motivate the subordinates

4. Result Oriented: - Management places emphasis on results. The activities of the managers arefocused on the attainment of goals or results. It is not just activities that matters but better results.

The results can be in the form of:A. Reduction in wastages B. Optimum use of resources C. Motivated workforce D. Higher efficiency, etc.

5. An art as well as a Science: -There is a considerable debate as to whether management is an art orscience. In practice, managing is an art. However, a manager can work better by using the

organised knowledge (Science). Therefore, management has characterised of both art as well as

science.

6. Follows established Principles: - Management follow well established principles in managingtheir organisation. The principles includesA. Division of work B. Authority-responsibility balance C. Discipline D. Unity of Command, etc.

7. Need not be ownership: - In Large organisations, management and ownership need not be oneand the same. The owners, i.e. shareholders can hire the service of professional managers.

8. Dynamic in nature: -Management need to be creative and innovative. The success and survival ofthe organisation largely depends upon innovation. Managers must come up with:

A. New and Creative Ideas B. New and better products C. Cost-effective processes, etc.

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8. NATURE/CHARACTERISTICS/FEATURE OF EVENT MANAGEMENT

Meaning: - Events play an important role in our society. Any happening or an activity can be

referred as an event. Examples of event can include:

Celebration of a festival or any other celebration. A football match between two clubs or countries. A launching of a new product. Farewell party to students, etc.Definition: -Dr. J. Goldblatt defines special Event as A unique moment in time celebrated with

ceremony and ritual to satisfy specific needs.

The Following are the characteristic ofEvent Management:

1. Creative Process: -Event Management is a creative process. The event management team must becreative or dynamic. It must come up with new ideas to manage and deal with the event. Creative

ideas will enable the success of the event.

2. Objective Oriented: - Event Management focuses on objectives. Every event has certain goals orobjectives to be achieved. Therefore, all the activities will be directed to achieve the objectives.

Unwanted activities or unnecessary formalities may be done away with.

3. Requires effective Leadership: - Event Management requires effective leadership on the part ofevent managers. The Event Managers have to influence and motivate the employees in order to

undertake the event successfully. Therefore, there is a need to have effective leadership skills on

the part of Event Managers to manage the event successfully.

4. Requires effective Promotion: - Event Management requires effective promotion. The eventpromotion involves: Publicity of the event. Advertising of the event. Maintaining good public relations Omtex

5. Planning and Control: -The event management team has to plan and control the activities relatingto the event, the planning and controlling activities involve:

Developing a mission statement for the event. Establishing the objectives of the event. Preparation of event proposal. Evaluating the performance of the event. Taking Corrective measures for the future event

6. Deals with different event: - To manage event successfully, there is a need for professionalismon the part of event management. Professionalism involves: Mega-event such as Olympics or World-Cup Football. Local events such as Carnival in Goa orBoat-race in Kerala. Organisational events such as launch of a new product. Etc.

7. Requires Professionalism: -To manage an event successfully, ther is a need for professionalismon the part of event management. Professionalism involves: Systematic planning and control of activities Proper training of manpower Proper compensation to the employees.

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9. NATURE/CHARACTERISTICS/FEATURE OF PROFESSIONAL MANAGEMENT

Meaning: - Professional management refers to the professional approach in managing the

organisations. Professional management is vital in todays competitive business world. The

importance of professional management is explained as follows

Following are the important characteristics ofprofessional management:

1. Formal Education: - professional managers are formally educated and trained to run thebusiness organisation. They place great emphasis on training and development of managers.

Most of the professional managers have either degree or diploma in management.

2. Merit the basis ofpromotion: - professionally managed companies follow merit as the basisof promotion at higher levels. Family neither ties, nor biased as the basis of promotions is

normally not followed in such organisations.

3. Delegation of authority: - The senior managers delegate authority to the subordinatemanagers. Routine and repetitive activities are given in the charge of subordinates. Only

important and crucial matters are decided by the superiors.

Omtex4. Social responsibility: - professional managers give the due consideration to the concept of

social responsibility. In fact, they try to bring reconciliation or a balance between profit motiveand social responsibility. They go for consumer oriented products. They try to improve the

quality through research and development, and so on.

5. Employees Participation: - The top management not only secures the active participation ofsubordinate managers in planning and controlling activities, but they also encourage initiativeand innovative ideas from the employees. Valuable suggestions are implemented and thosewho provide ideas are often rewarded.

6. Automation and Modernisation: - professional managers advocate the need for automationand modernisation. They recognise the change brought in by changing situations, and are ready

to accept that change. They also encourage their subordinates to willingly accept the

automation and modernisation plans of the organisation.

7. Decentralisation: -professional management believes in balance between centralisation anddecentralisation. Important matters are centralised, and other matters are decentralised. The top

management believes that involvement of lower level managers is vital to the success of the

organisation.

8. Style of leadership: - professional managers follow the situational style in managing theirbusiness activities. They are more of democrats rather than autocrats.

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10. NATURE/CHARACTERISTICS/FEATURE OF DISASTER MANAGEMENT

Meaning: -According to Oxford Dictionary a crisis is a decisive moment-a time of great difficulty, adisaster, or a catastrophe. It is a turning point that changes the destiny of an individual or a group or a

company or a government. Therefore, the term Crisis and Disaster are used as synonymous. However,

usually crisis is considered as made and a disaster as a natural calamity.

World book, 2001, Chicago has defined disaster as a sudden extremely unfortunate event that affects many

people. It includes natural occurrences such as earthquake, volcanic eruptions, floods, famine and so on. Italso includes man made calamities such as bomb blasts, accidents, looting and rioting during communal riots,

etc.

The following are some of the important features of disaster management:

1.Disaster Management Teams: - World wide, governments, business and non-businessorganisation are setting up disaster or crisis management teams in order to manage the disaster.The disaster management teams are broadly divided into three parts namely(1) The Policy Team

(2) The management Team (3) The Liaison Team.

2.Systematic Planning: - Disaster management involves systematic planning to avert a disaster, andif it occurs, then systematic planning is required in order to overcome the crisis arising out of

disaster, Disaster planning indicates, what to do, when to do, how to do and who is to do certain

activities to manage and overcome the problems of disaster.

3.Organising of Resources: - Disaster Management requires proper organising of resources such asmanpower, materials, funds, etc., in order to deal with the calamity. Proper organizing of resources

will help the disaster management personnel to overcome the problems caused by the calamity or

disaster.Omtex

4.Training to Manpower: -To manage a disaster effectively, there is a need to provide propertraining to the disaster management personnel. The training will help to develop and improve

Disaster Management skills in the personnel. Training may help to avert a disaster effectively.

5.Suitability: - Disaster Management is required before and after a disaster. It is suitable before adisaster in order to avert a disaster, or to caution the people and to take proper appropriate

measures before the disaster strikes. Disaster Management is also very much required after a

disaster takes place in order to undertake rescue, relief and rehabilitation measures at the time of

floods, earthquakes.

6.Stability: -Normally, disaster management teams lack stability. They are formed just prior to adisaster in order to avert it, whenever possible. However, in advanced countries such as in USA,UK, Japan,etc., some organisations form more or less permanent Disaster Management teams.

7.Organisation Structure: -Robert F. Littlejohn in his paper on Crisis Management suggesteda matrix organisation structure to deal with disaster or crisis in the organisation or in the city or

country. The disaster management team is to be headed by a crisis manager.

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11. NATURE/CHARACTERISTICS/FEATURES OF NEW INDUSTRIAL POLICY 1991

Meaning: -The Government of India announced the new industrial policy (NIP) on 24thJuly,

1991. The NIP aims at liberalisation of Indian industry. The main objectives of the NIP are:

1. Attainment of international competitiveness.2. Development of backward areas.3. Encouraging competition within Indian industry.4. Efficient use of productive resources.5. Full utilisation of plant capacities to generate employment.6. Revival of weak units, etc.

Following are some of the main features of the industrialpolicy 1991

1. Dereservation of Public Sector: -The role of public sector has been reduced to a great extent.The number of industries reserved for public sector was reduced to 8 industries. There was

further Dereservation. At present, there are only three industries reserved for public sector

which include. (a) Atomic energy (b) Railways, and (c) specified Minerals.

2. Delicensing: -The most important features of NIP, 1991 was the abolition of industrial licensingof all industries except six industries. The six industries are of social and strategic concern. Thesix industries are

1. Hazardous Chemicals. 2. Alcohol3. Cigarettes 4. Industrial Explosives5. Defence Products,and 6. Drug and pharmaceuticals.

3. Disinvestment ofpublic sector: -The NIP 1991 permitted disinvestment of public sector units.Disinvestment is a process of selling government equity in PSUs in favour of private parties.Disinvestments aim at certain objectives. (1) To provide better customer Service. (2) To make

effective use of disinvestment funds. (3) To overcome the problem of political interference. (4)

To enables the government to concentrate on social development. Etc,

4. Liberalisation of Foreign Investment: -Prior to this policy, it was necessary to obtain approvalfrom the government in respect of foreign investment. At present, 100% foreign equity

participation is allowed in select industries.Omtex

5. Liberalisation Foreign Technology: -The NIP 1991 liberalised foreign technology to bringabout technological improvement in Indian industry. (1) No Permission is required for hiring

foreign technicians and foreign testing of indigenously developed technologies.

6. Liberalisation of Industrial Location: -The IP 1991 stated that there is no need to obtainapproval from Central Government to locate industries in areas (other than cities of more than

one million populations). However, industries subject to compulsory licensing, approval need to

be obtained. In cities with a population of more than one million, polluting industries wererequired to be located outside 25 Kms of the city area.

7. Removal of Mandatory Conversion Clause (MCC): - In India, banks and FIs provide a largepart of industrial finance. The banks and FIs have the option to convert the loans into equity.

This may create a threat of takeover by FIs. Therefore, the IP 1991 abolished MCC.

8. Abolition of phased Manufacturing Programme: - The IP 1991 has suggested for theabolition ofPMP, which was in force in engineering and electronic industries.

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12. OBJECTIVES/FEATURES OF WORLD TRADE ORGANISATION

Meaning: -The World Trade Organisation came into existence with effect from 1-1-1995. The

WTO replaced General Agreement on Tariffs and Trade (GATT). The main objective ofWTO is to

increase world trade and thereby employment. In 1947, 23 countries including India signed the

General Agreement on Tariffs and Trade (GATT). GATT was created to reduce the tariff barriers.

GATT has been replaced by WTO in 1995. WTO is wider in scope. It is concerned with not only

reducing or eliminating tariff barriers but also non-tariff barriers such as quotas. In April 2004, the

membership of WTO was 147 countries including India.

The Main Objectives of the WTO are as follows:

1. Trade without Discrimination: -Trade without Discrimination through the application of mostfavoured nation (MFN) principle. As per MFN clause, a member nation of WTO must accordthe same preferential treatment (in case of tariff reduction or concession) to other member

nations which it gives to any other member nation.

Omtex2. Settlement of Disputes: - Settlement of Disputes among members through consultation,

conciliation, and as a last resort through dispute settlement procedure.

3. Raising Standard of living: - Raising standard of living and incomes and ensuring fullemployment of the citizens of its member nations.

4. Optimum use of world resources: - Ensuring optimum use of worlds resources and, thereby,expanding world production and trade of goods as well as services.

5. Protection of environment: -Preserving and protecting the environment of the world so as tobenefit all the nations of the world.

6. Growth of less developed countries: - Recognises the need for positive efforts, designed toensure that developing countries. Especially the less developed countries, secure a better share

of growth in international trade.

7. Employment: - WTO aims at generating full employment and broad increase in effectivedemand.

8. Enlargement of Production and Trade: -WTO aims to enlarge production and trade of goodsas well as services.

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13. FEATURES/CHARACTERISTICS/NATURE OF TOTALQUALITY MANAGEMENT

Meaning: -The concept ofTQM was developed by Dr.W.E. Deming (regarded as the father of

TQM) in 1960s in Japan. TQM is strategic approach that focuses on production of best possible

product or services through constant innovation and timely action. It places emphasis on prevention

of errors rather than on rectification.

Definition: - TQM is a management approach that places emphasis on continuous improvement in

quality, in the interest of the organisation and that of its customers. (Prof. K.K Choudari)

THE FOLLOWING ARE SOME OF THE FEATURES OFTQM

1. Customer Focus: - - TQM Palaces emphasis in meeting the requirement ofboth the internal aswell as the external customer. In order to meet the requirements for the external customer, it is

necessary to meet the needs of the internal customer. The initial focus should be on meeting needs

of internal customer before an attempt is made to meet the requirements of the external customers.

2. Continuous Process: - TQM is a continuous process. Constant and continuous efforts are made toimprove the quality, and to reduce internal costs. Quality improvement helps the organisation toface the challenges of the competitors and to meet the requirements of the customers. TQM is a

process which goes on forever, because at no time the quality can be100% right. There is always

a possibility for new and better way of doing things.

3. Defect-free Approach: - TQM place emphasis on the defect-free work most of the time. Thedefect free approach is phrased in various ways as right first time, working smarter or zero defects.

Omtex4. Employees Involvement: - in TQM everyone is involved in the process from the management

director to the junior clerk or worker in the organisation. It is not just manufacturing people, but

also the accounting, finance, marketing, and even the canteen people are involved in the TQM

process.

5. Recognition and Rewards: - Recognition and rewards is an integral part of companys TQMProgramme. Positive reinforcement through recognition and reward is essential to maintain

achievement and continuous improvement in quality.

6. Synergy in Team Work: -The Japanese are great believers in synergy (to work together).Engineers, technicians, and workers look upon themselves as equals and communicate easily as

they work side by side. They create what professor Okuda has called a synergetic Partnership .

7. Techniques: - TQM can take place by following various techniques such as quality circle, valueengineering, statistical process control, etc. Through such techniques it is possible to improve

systems and procedures.

8. System Approach: - TQM is a system approach to managing the business and improving theperformance. Without the total commitment on the part of chief executive officer and his senior

executives, TQM cannot take off to a good start.

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14. NATURE/FEATURE/CHARACTERISTICS OF CONSUMER MOVEMENT

Meaning: - Consumer movement is a social movement of consumers that has come into existence

to educate and unite consumers to fight for protection of their rights.

Definition: - Philip Kotler and G. Armstrong Consumerism is an organised movement of

citizens and government to impose the rights and powers of buyers in relation to seller .

Following are the some important features of Consumer Movement:

1. Voluntary movement2. Production of rights3. Strength of unity4. Comprehensive term5. Prevention of unethical practices6. Enforcing consumer rights

Omtex1. Voluntary Movement: - It is a voluntary and collective movement of consumers; it is a

movement of the consumers, by the consumers and for the consumers. A group of active

consumers come forward, forms a union and fight for the well-being of the community.

2. Protection of Rights: - The objective of the consumer movement is to make the businesscommunity and government to guarantee and enforce the legitimate rights of consumers.

3. Strength ofUnity: -Consumerism is a social force whose aim is to protect rights of consumersby exercising legal and social pressure on business community.

4. Comprehensive Term: - Every one of us is a consumer of goods and services provided byprivate and government undertakings. Today, the concept of consumerism is not restricted to

commercial activities alone. Also extended to public utilities, and services like banking,

transport, telephones, medical.etc.

5. Prevention of unethical Practice: - consumerism is a voluntary association of consumers,whose one of the objective is to prevent the business from following unethical practices like

black-marketing, exploitation of consumers etc.

6. Enforcing Consumer Rights: - The consumer movement aims at enforcing four basic rights ofconsumers-Right to safety, Right to be informed, Right to choose and right to redress.

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15. NATURE/FEATURE/CHARACTERISTICS OF PRINCIPLES OF MANAGEMENT

Meaning: -Principles of management are the guidelines to be followed by managers in managing

the organisation. No manager can be effective if he/she does not follow the principles of

management. Therefore, managers in all organisations, whether large or small, business or non-

business, and at al levels (top, middleand lower) must follow the principles of management.

The nature ofprinciples of management can be briefly explained as under:

1. Basic Guidelines: -The principles provide basic guidelines to the managers to manage thesubordinates effectively. If managers follow the well established principles of management, thenhe/she would be in a better position to get the work done effectively and efficiently from the

subordinates.

2. Applicable to business and non-business organisation: - principles of management are applicableto business organisations as well as to non-business organizations. For instance, the principle of

management must be followed by managers in a non-business organisation such as hospitals,

educational institutions, charitable trust, etc.

Omtex3. Applicable at all levels: -The principles of management must be followed by managers at all

levels. Principles of management are the guidelines to be followed by managers in managing the

organisation. No manager can be effective if he/she does not follow the principles of management.

Therefore, managers in all organisations, whether large or small, business or non-business, and at

al levels (top, middle and lower) must follow the principles of management.

4. Applicable to any size of business: - The principles of management are applicable not only tolarge organisation such as joint stock companies but also to small organisations, like sole trader

too. It necessary for the sole trader to follow the principles of management in order to satisfy thecustomer and to run the organisation successfully.

5. Time Tested: - The principles of management are time tested. The basic principles ofmanagement have remained the same for a number of centuries (although Henri Fayol first

published the list of 14 Principles of management in 1916). Principles of management are

practiced by the people over period of time.

6. Ensures smooth working of an organisation: - The principles of management ensure smoothworking of an organisation. For instance, the principles of division of work, team spirit, order, etc.,

enable the organisation to conduct its activity in a systematic and successful manner.

7. Situational in Nature: -Certain principles of management may be applied depending upon thesituation. For instance, a manager may not delegate authority to subordinates, if subordinates have

no knowledge of a certain type of work. In such a condition the managers must first training the

subordinates, and then to delegate the authority.

8. Intangible: - The principles of management are not directly visible. The effect of principles can befelt by the results. If the managers follow the principles, then there can be higher results in theorganisation in the form of: -

Reduction of wastagesOptimum use of resources

Motivated and dedicated workforceHigher efficiency.

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16. DEFINE DISTRICT FORUM? E PLAIN ITS FEATURES?

Meaning: -A Consumer Disputes Redressal Forum, to be known as the DistrictForum, established by the State Government in each district of the State as per the

Consumer Protection Act 1986.

FEATURES OF DISTRICT FORUM

1. Composition of District Forum: -A District Forum has to consist of:a. A person who is or has been or is qualified to be a District Judge, to be

nominated by the State Government, to be its President.b. Two other persons of eminence, in the field of education, trade, or commerce one

of whom shall be woman.

Omtex2. Term of Office: -Members of the District Forum hold office for a term of 5 years or

upto the age of 65 years whichever is earli er and are not eligible for re-appointment.

In other words, the maximum period of membership of the forum is 5 years.

3. Salary: -The State Government drafts rules regarding salary or honorarium andother allowances payable to members and also the terms and conditions of their

service.

4. Jurisdiction of District Forum: -As per the latest amendments, the District Forumhas the jurisdiction to entertain complaints, where the value of goods or services and

the compensation, if any, claimed does not exceed Rupee s Twenty Lakh.

5. Number: -There are a number of District Forums in Maharashtra eg, In Mumbai,Pune, Ahmednagar, Aurangabad, Nagpur, Nasik, Ratnagiri, Satara, Sholapur, Sangli

etc.

In Mumbai, the District Forum has 3 offices, at Dadar, Worli and C.S.T.

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1. DEFINE PRIVATISATION? E PLIAN NEED/IMPORTANCE OF PRIVATISATION?

Meaning: -Privatisation means inducing private ownership, management and control into

public sector undertakings. It is opposite of nationalising private firms. It implies

disinvestment in public sector units and passing of management rights to private entrepreneurs.In some cases the management and control of public undertakings may be transferred to

private sector without transferring the ownership.

Privatisation is importance due to the following reasons: -

Omtex1. Improvement in efficiency: -The motive of private enterprises is to maximise profits.

Therefore, they have to improve efficiency and performance without the competitive forces.

2. Raising Funds: -By selling government equity to private sector it is possible to raise fundsfor public investment.

3. No political influence: - Once a public sector is privatised it becomes free from political,ministerial and government intervention.

4. Quick Decisions: - In private sector organisation quick decisions can be taken to respondto changing circumstances.

5. Better Service to the customers: -The survival and growth of private sector enterprisesdepends on consumer satisfaction. Therefore they try to provide better quality goods andservices to their customers.

6. Quick remedial measures: -In private sector enterprises quick remedial measures must betaken to avoid wastages, losses and to secure benefits from business opportunities. There is

no scope for red tapism.

7. Easy to fix responsibility: -In private sector organisation authorities, responsibilities andaccountability are generally fixed by the Board of Directors and corporate laws. Therefore,it is easy to fix the responsibility in the case of failure in performance by any employee

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2. DEFINELIBERALISATION? E PLAIN THE NEED FORLIBERALISATION?

Meaning: - Liberalisation is the process of liberating the economy from variousregulatory and control mechanisms of the state and of giving greater freedom to p rivate

enterprise.

Definition: - Liberalisation can be defined as, Unilateral or multilateral reductions

in tariffs and other measures that restrict tradeOmtex

NEED FORLIBERALISATION

1.Bring flexibility in the operations of business organisations. This will lead toincrease the production and distribution.

2. Paves the way for globalisation3. Helps companies to compete with other companies at international level.4. Saves time, efforts and money of business enterprises.5. reduces cost of production and distribution6. Increase efficiency, productivity and profitability of business organisations . This

will lead to expand its business activities.

Measures ofLiberalisation have been adopted by the Government of India are as

follows: -

1. Write New Industrial Policies Explanation

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3. DEFINE GLOBALISATION? E PLAIN THE NEED FOR GLOBALISATION?

Meaning: - It is a process of global integration of products, technology, labour, investment,

information and even cultures. In other words, globalisation is the process of integrating a countrys

economy with the world economy with a view to exploit global opportunities for countrys growth.

Definition: -According to Harris Globalisation has

FACTORS RESPONSIBLE FORGLOBALISATION OF BUSINESSOmtex

1. Free Trade: -In recent years, there have been efforts by various countries to reduce thenumber and level of trade restrictions i.e. to achieve free trade country should remove tariff

duty and quota limits should be avoid.

2. Setting up of W.T.O: - The world Trade Organisation has been set up which is made up ofcountries committed to the principle of freeing world trade from restrictions.

3. Free Trade blocks: - These are groups of countries (often geographically grouped) thathave arranged to trade with each other without restrictions. E.g. (NAFTA) and (ASEAN)

the members of the European Union (EU) also trade freely amongst themselves.

4. International banking and revolution in information technology have a big push toglobalisation.

5. Internationaleducation and tourism facilitates globalisation of cultures and languages.

6. Increasing demand ofconsumers for world class products and services.

7. Growth ofmultinational countries i.e. the business organisations having their headquartersin one country but operating branches, factories and assembly plants in other countries.

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4. IMPORTANCE/ADVANTAGES/ FUNCTIONS/ROLE OFBUSINESS ENVIRONMENT?(March 2009)

Meaning: - Business Environment consists of all those forces or factors both internal and external that affectsthe working of a business. Analysis of the internal environment helps a firm to identify its strengths and

weakness, and the analysis of the external environment helps to identify opportunities and threats. Thus,

environment analysis helps to undertake the SWOT analysis, i.e., strength, weaknesses, opportunities and threats.

Definitions: - According to Keith Davis, Environment of the business means the aggregate of all

conditions, events and influences that surround and affect it.

The role and importance of business Environment analysis is briefly explained as follows :

1. Identification of Strengths: -The analysis of the internal environment helps to identify the strengths of thefirm. For instance, if the company has good personnel policies in respect of promotion, transfer, training,

etc., then it indicates strength of the firm in respect of personnel policies. After identifying strengths, thefirm must try to consolidate its strengths by further improvement in its existing plans, policies, andresources. Omtex

2. Identification of Weaknesses: -The analysis of the internal environment indicates not only strengths butalso weakness of the firm. A firm may be strong in certain areas, whereas, it may be weak in some otherareas. The firm should identify such weaknesses so as to correct them as early as possible. For instance, the

machines used by the firm may be outdated; therefore, the firm may replace the obsolete machines withnew ones so as to improve the quality and quantity and also to reduce the cost of production.

3. Identification of Opportunities: -An analysis of the external environment helps the business firm toidentify the opportunities in the market. The business firm should make every possible effort to

grab the opportunities, as and when they come. Failure to do so would mean that someone also wouldgrab the opportunities.

4. Identification of Threats: -Business may be subject to threats from competitors and others.Therefore, environmental analysis helps to identify threats from the environment. Identification of

threats at an earlier date is always beneficial to the firm as it helps to defuse the same.Identification of competitors strengths is very much helpful for the firm to take immediate actions

to counter the strategy of the competitors by introducing a new product or entering into new

markets or in new product lines.

5. Effective Planning: -A proper study of environment helps a business firm to plan its activitiesproperly. Before planning, it is very much necessary to analyse the internal as well as external

environment. After SWOT analysis, the firm can identify specific objectives, which in turn helps

to frame proper plans.

6. Facilitates organising of resources: -A Proper analysis of environment enables a firm to knowthe demand potential in the market. Accordingly, the firm can plan and organize the right amount

of resources to handle the activities of the organisation.

7. Optimum use of Resources: -A study of technological development, government policies,demographic pattern, etc. will help the business firm to plan its activities and allocate the limited

resources in a better way.

8. Helps to be active and alert: - Environmental analysis help a business firm to remain active andalert in the competitive market. In the absence of environmental analysis, a business firm may

adopt a casual approach towards business, which in turn leads to failure or closure of the business.

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5. IMPORTANCE/ADVANTAGES/ FUNCTIONS/ROLE OFBUSINESS ETHICS

(March 2008)

Meaning: - The term ethics is derived from the Greek word ethos, which means character. Ethics isa branch of social sciences, which deals with concepts such as right and wrong, good and bad, fair and

unfair, just and unjust, legal and illegal, moral and immoral, proper and improper in respect of human

actions.

Definition: -Thomas M. Garett defines Business Ethics is primarily concerned with the relationshipof business goals and techniques to specific human needs.

The following points explain the need for and importance ofBusiness Ethics :

1. Protection of Consumer Rights: -Consumer is the centre of all the business activities. In fact,business is essentially meant for satisfaction of consumer wants. Unfortunately, consumers are the

most neglected and exploited group. The application of business ethics will help to confer andimplement consumer rights.

Omtex

2. Social Responsibility: -Business Ethics is a means of making business socially responsible for itsactions. Exploitation of consumers, employees, discriminate use of natural resources, etc., is quite

common in all type of business. Compliance to ethical standards will ensure (a) Protection ofconsumer rights (b) Public accountability (c) Protection of workers interests, and (d) Proper

utilisation of natural resources.

3. Concept of Socialism: -The Concept of Socialism in business states that gains of a business mustbe shared by all and not just by the owner of business. Profit is a sign of business skill and talent.

Profit is also a result of group efforts. Employees, shareholders, consumers, suppliers, and others

contribute to the success of the business. Therefore, success should be shared by all concerned.

4. Interest ofindustry: - Business Ethics are necessary to safeguard the interests of the small scale business firms. The tendency of big business firms is always to dominate the market and driveaway the small industries out of the market. Small scale units can establish their position and fight

for their right if the industry follows a code of ethics.

5. Consumer movement: -The growth in consumer movement is also another important factor thathas necessitated the need for business ethics. The spread of education and awareness among

consumers about their rights has made the business community to conduct business on ethical

principles.

6. Better Relations With the Society: -Business Ethics is needed to develop good relations betweenbusiness and society. The relationship of business with society has various dimensions such as its

relations with shareholders, employees, consumers, distributors, competitors and government.

7. B

uyers market: - There has been a structural change in the concept of business. The concept of profit has been gradually taken over by consumer satisfaction. The large scale production and

increased competitions in the market changed the business scene from a sellers market to a

buyers market.

8. Beneficial to Business and Society: - Ethics suggests what is good and bad, right and wrong,ethical and unethical, etc., to businessman. It also brings an element of honesty, sincerity, fairness,

and human touch to business activities.

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6. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF CONSUMER MOVEMENT.

Meaning: - Consumer Movement is a Social Movement, Consumer movement aims at promoting aninterest of the consumers the following are the objectives of consumer movement.

Definition: - Philip Kotler & G. Armstrong define Consumerism is an organised movement of

then citizen and government to impose the rights and powers of buyers in relation to seller .

Following are the Importance of Consumer Movement

1. Protection against Malpractices: - the main objective of consumer movement is to protect the interest of the consumer from the malpractices adopted by the business

community such as charging high prices, supplying inferior goods, creating artificial

shortage.

2. Educating the consumers: - consumer movement aims at educating and informing theconsumer about their rights, such education makes the consumer aware of their rights.

3. Representing Consumers: - the consumer protection organisation such as consumerguidance society of India represents on behalf of the consumers to the government

authorities so as to frame proper consumer protection laws and other measures forconsumer protection.

4. Publishing unfair practices: - Consumer protection organisation publishes in variousmedia regarding the unethical practices of the businessman.

5. Forming of Association: - consumer movement encourages consumer to form consumerprotection associations at the local level.

6. Support to business community: - consumer movement aims at co-operation and supportto the business community in dealing with their problems and difficulties

7. Assistance in legal matters: - the Consumer protection organisation assist individualconsumers in legal matters i.e. the procedure to be followed in filling a complaint in thecourt.

8. Exerting or creating pressure on businessman: - consumer movement aims at exerting apressure on businessman and makes them more socially responsible.

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8. WRITE SHORT NOTES ON CONSUMER RIGHTS?

Introduction: -In 1962 the American president John F. Kennedy, in his Consumer message to U.S.

congress had specifically mentioned four consumer Rights and opened the door for consumerismin .U.S. and all over the world.

Kennedy declared that consumers have the right to safety, to be informed, to choose and to be heard.

Consumer Movement is a Social Movement of Consumers that has come into existence to educate

and unite consumers to fight for protection of their rights.

Def: - Philip Kotler & G. Armstrong define Consumerism is an organised movement of then

citizen and government to impose the rights and powers of buyers in relation to seller .

1. Right to Choose: - A Consumer should be given open access and freedom to choose from avariety of products and services. Right of choice aims at promoting competition and discardingmonopoly. Sometimes leading competitors for the sake of business purpose joint hands and

allocate market among them. In order to restrict their monopoly it is necessary to get freedom of

choice.

2. Right to Safety; -A Consumer has a right to be protected against the marketing of goods, whichare dangerous to human health and life. Consumer has a right to receive an assurance from the

producer about the quality, reliability and performance of good for products like electrical

appliances, automobiles etc. considerable safety and security is required similarly food articles like

sweets, fast food, colddrings etc. should be free from substances that are harmful for human

consumption.

3. Right to be informed: -A Consumer has a right to be protected against fraudulent, miss leadinginformation, advertising, labelling or other practices and to be given facts needed to make proper

choice.

4. Right to be heard: - This right permits the consumer to register his dissatisfaction or complaintwith the company and government. The right to heard also includes legal hearing to get redress of

their complaints. This right can be exercised effectively only when the consumers are properly

organised.

5. Right to redress: - Many times, it so happens that the actual performance or quality of productdoes not match with what is advertised or stated on package. This right enables the consumers toget his claims settled, if he becomes a victim of exaggerated claims.

6. Right to Consumer education: -This is another important right aims at supplying information andeducating consumers regularly. It is a continues process and works to update consumers

knowledge about the developments in business and industry, and changes made in laws affecting

consumers rights.

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9. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF TOTALQUALITY MANAGEMNET

Meaning: -The concept of TQM was developed by Dr.W.E. Deming (regarded as the father of

TQM) in 1960s in Japan. TQM is strategic approach that focuses on production of best possible

product or services through constant innovation and timely action. It places emphasis on prevention

of errors rather than on rectification.

Definition: - TQM is a management approach that places emphasis on continuous improvement inquality, in the interest of the organisation and that of its customers.

The need and importance ofTQM can be stated with the help of its advantages:

1. Customer Satisfaction: - TQM stresses the need to satisfy both the internal as well as theexternal customer. Internal customer refers to the persons within the company who receives the

work of another and then adds his or her contribution to the product or service before passing it

on to someone else. TQM must focus on the customers, the eventual buyer of the product or

services. To do so, the initial focus should be on meeting needs of internal customer before an

attempt is made to meet the requirements of the external customers.

2. Helps to Face Competition: - A Proper emphasis on TQM enables a company to face thecompetition in the market. The company may even come out as a winner or a leader. This is

because of high quality product, at the lowest possible cost, produced by a dedicated team of

work-force.

3. Good will: -TQM generates name and reputation to the company in the market. This is becauseof its constant efforts in bringing the improvement in the products-design, variety, shape, size,

colour, shade and other features.

4. Highly motivated personal: - TQM develops a sense of dedication and discipline in theemployees. There is willingness on the part of the employees to identify quality improvementsand waste elimination opportunities. The employees become aware of their importance in the

companys performance and progress. This leads to greater involvement and participation of the

employees.

5. Lower rejection rate: - Internal rejection rate gets reduced considerably over a period of time.Various initiatives such as quality circles, process control, right first time approach, just in time

approach, etc., enable the company to reduce rejection rate.

6. Reduction in customer complaints: -TQM results in less or no customer complaints. This is because the products are built to specification with zero defects. Again, efforts are made to

improve upon the customer specification so as to provide complete satisfaction.

7. Better facilities to employees: - TQM results in higher benefits to the organisation in terms ofincreased profits. The higher profits are utilized in a way to provide better facilities to theemployees in terms of training, salary, canteen facilities etc.

8. Expansion and Diversification: - TQM generates a good name in the market. It also brings inhigher returns. This enables a company to expand and diversify.

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10. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF EVENT MANAGEMENT

(March 2009)Meaning: - Events play an important role in our society. Any happening or an activity can be

referred as an event. Examples of event can include:

Celebration of a festival or any other celebration.A football match between two clubs or countries.A launching of a new product.Farewell party to students, etc.Definition: -Dr. J. Goldblatt defines special Event as A unique moment in time celebrated withceremony and ritual to satisfy specific needs .

Event management is vital for the following purposes:

1. Develops the theme of the Event: - The event management team develops the theme of the event.The theme of the event should be linked to the purpose of the event. It should develop team sprit or

friendship between two clubs or states or nations. Therefore, the theme of the event may be

described as The friendship Series or The Good will Series.

2. Provides Career Opportunities: - Event management Provides career opportunities. Apart fromevent manager, there are several other job opportunities in the Event management such as:

1. Operation and Logistics managers. 2. Entertainment managers 3.Sponsorship managers.4. Event coordinator 5.Event Designer 6.Security Coordinator, etc.

3. Develops leadershipqualities: - Event management develops leadership qualities. To manage anevent, the managers require good leadership qualities to influence and motivate the subordinates to

work effectively in making the event more successful.

4. Develop Team sprit: - Event management helps to develops team spirit in the employees. Thesuccess of the Event management largely depends upon the team effort. Therefore, there is needfor team work between managers and their subordinates, and between the various departments in

the organisation, so as to make the event more successful.

5. Enhances Corporate Image: -Proper Event management helps to develop corporate image of anorganisation. If the event is well managed, then there is a possibility of greater success.

6. Encourages Creativity: - Event management encourages and develops creativity in the managers.Managers need to be dynamic or innovative in managing the event. The mangers have to find out

new and innovative ways in managing the event.

7. Ensures safety and security: - Event management team ensures safety and security of the peopleduring the event. The Event management team makes proper security and safety arrangements. For

instance, the event management team makes proper arrangement to deal with the certain crisissuch as occurrence of fire, failure of lighting or air conditioning, gas leaks, and so on.

8. Financial Management: -The Event management team may be responsible for the financialmanagement of the event. The event management team may be responsible for:

y Preparation of budget for the event.y Determining break-even pointy Preparation of cash-flow analysis, andy preparation of profit and loss statement, etc.

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11. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF DISASTER MANAGEMENT

Meaning: -According to Oxford Dictionary a crisis is a decisive moment-a time of great difficulty, a

disaster, or a catastrophe. It is a turning point that changes the destiny of an individual or a group or a

company or a government. Therefore, the term Crisis and Disaster are used as synonymous.

However, usually crisis is considered as made and a disaster as a natural calamity.

World book, 2001, Chicago has defined disaster as a sudden extremely unfortunate event that

affects many people. It includes natural occurrences such as earthquake, volcanic eruptions, floods,famine and so on. It also includes man made calamities such as bomb blasts, accidents, looting and

rioting during communal riots, etc.

Disaster management is vital for the following purposes.

1. To avert a disaster: - Disaster management teams can help to avert a disaster before it occurs. TheDisaster management team may examine the possible causes of disaster, and may take appropriate

measures to avert a disaster. For instance, forest fires, or even terrorists bombings can be averted

through effective planning and pre-emptive action.

2. To undertake rescue operations: - Disaster management personnel can undertake rescueoperations effectively. Trained disaster managementpersonnel can rescue people effectively at the

time of floods, major fires, building collapses, and so on.

3. To provide relief measures: - Disaster management team is responsible to provide reliefmeasures to the victims. For instance, the team can make arrangement for food, clothing, and relief

camps, medicines and so on. Such measures would reduce the misery of the disaster victims.

4. To undertake rehabilitation programmes: - Disaster management team can work effectively toundertake rehabilitation programmes in the affected areas. For instance, in the earthquake affectedareas, rehabilitation programmes include:

a. Construction of dwellingsb. Schools and other infrastructure.

5. To undertake liaison work: -The disaster management team undertakes liaison work relating tothe disaster. The liaison work is required with various agencies-private and government (including

hospitals) in order to obtain funds and donations, and other resources or services so as to manage

and overcome the disaster.

6. To reduce trauma and tension: - The Disaster management team can help to reduce the traumaand tension before and after the disaster. For instance, before a disaster, the team can properly

guide the people to face or handle the disaster such as floods. Also, after the disaster, the team can

provide not only material or financial support, but also psychological support to overcome thetraumatic effect of disaster.

7. To protect the Environment: - Disaster management team can help to protect and preserve theenvironment. For example, a disaster management team can plan pre-emptive action to avert forest

fires. Etc.

8. To minimize losses: - Disaster management teams can help to minimize loss of life and property.This is because; the Disaster management team can take pre-emptive actions to avert a disaster.

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12. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF PROFESSIONAL MANAGEMENT

Meaning: -Professional management refers to the professional approach in managing the

organisations. Professional management is vital in todays competitive business world. The

importance of professional management is explained as follows:

1. Innovation: -Professional management facilitates innovation in the organisation. Now-a-days, itis essential to generate new ideas; new product, and new technology, etc. innovation helps to

gain competitive advantage in todays competitive business world.

2. Corporate Image: - Professional management enables the organisation to enhance corporateimage. Effective management is required to bring improvement in quality of goods and services

offered by the company. A good corporate image creates confidence about the company in theminds of customer, employees, shareholders, etc.

3. Team work: - Professional management develops team sprit in the organisation. It is the teamwork that brings success to the organisation. There is a need for team work among theemployees and the departments in the organisation.

4. Optimum use of resources: - Professional management facilitates optimum use of resourcesin the organisation. Effective management helps to reduce wastage of resources to a greater

extent. Optimum use of resources brings good results to the organisation.

5. Motivation: - Professional management facilitates motivation of the employees in theorganisation by providing incentives. Motivated employees work with application anddedication. The dedication on the part of motivated work force brings higher efficiency in the

organisation.

6. Reduction in Wastages: - Professional management ensures reduction of wastages in theorganisation. Now-a-days, reduction in wastages is vital to any organisation. Reduction in

wastages generates higher productivity in the organisation.

7. Higher Efficiency: - Professional management is required to generate higher efficiency in theorganisation. Efficiency is the relation between returns and costs. The more the returns at the

same costs or at a lower cost, then the organisation is said to be more efficient.

8. Quality of workers life: - Modern management shares the fruits of productivity andefficiency with the workers. Workers are provided not only with good working conditions but

they are also rewarded monetarily and non-monetarily, and as such their quality of life enhances

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13. IMPORTANCE OF MANAGEMENT? (March 2009)

Meaning: -The survival and success of an organisation largely depends upon the quality of management.

Some organisation prospers and progress not only in good times but also during tough times, but others

fails even during good times. Therefore, it is vital for every organisation to have dynamic and dedicated

managers.

Definition: - To manage is to forecast and to plan, to organise, to command, to coordinate andto control.(Henri Fayol)Management is the art of getting things done through and with people in formally organised groups.

(Harold Koontz)

Following are the importance ofMANAGEMENT1. Efficiency and Effectiveness of Human Efforts: - The management tries to combine the

resources of an organisation in the most productive manner so as to maximise the benefits and

minimise the Wastages. This leads to efficiency. The management insists on using innovativeideas to bring out quality and effective products.

2.Harmony in Work: -Employees who come from different backgrounds have differentqualification and different styles of working. If everyone is allowed to follow their own style of

working, it can lead to chaos and confusion in the organisation the management brings uniformity

in their efforts leading to systematic working with good results.

3. Critical ingredient in nations growth: -Economic growth of a country depends on howefficiently resources are being utilised efficient management makes optimum utilisation ofresources. This brings good results in the organisation.

4. Right Decisions: - The Management helps in taking right decisions in the selection, utilisation andallocation of the resources in different activities.

5. Achieving the group goal: -The effective Management tries to integrate the individual goals of allthe employees with the goal of the organisation.

6. Effective leadership and motivation: - The effective and dynamic management is the source ofstimulus to the employees. They are motivated to contribute their best efforts in their jobs.

7. Clear authority and responsibility: -Management, being a group effort, clearly assigns duties,established\s authority and responsibility of every employee in the organisation. It eliminatesoverlapping confusion and duplication.

8. Solution oflabour problems: - These days employees have become conscious of their rights andtheir precious contribution to the organisation in the achievement of its goal. They demand morewages, bonus, improved working conditions etc; in such circumstances the efficient management

avoid confrontation between employees and management.

9. Reducing labour turnover and absenteeism: -10.Fulfilling social responsibility: -Modern management understands its social responsibility and its

commitment to the workers, consumers, investors, government and the public. it also participates

in social welfare programmes.

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1. MANAGEMENT IS AN ART EXPLAIN

Meaning: - There is a considerable debate as to whether management is an art or science. In

practice, however, a managers job involves both science and art.

Definition: - Mary parker follet, Harold Koontz and several other management authors called

management as the art of getting things done through people.

Management is an art due to the following reasons

1. Innovative: -Management like any other art needs to be innovative; managers have to come upwith new ideas or solutions to handle situations. There is a constant need to be innovative in order

to gain competitive advantage. Copying has no place in management.

2. Individual Approach: - Every manager needs to adopt his individual approach or style ofmanaging to handle situations. Individual approach can create a big difference in managing thesubordinates. For instance, given the same situation, same resources, and the same environment,

some managers can easily get the work done from their subordinates. Whereas, others fail in spiteof their best efforts.

3. Application and dedication: -Good managers require not only skills and knowledge but there isalso a need for discipline, dedication, and commitment. It is often said that success is the outcome

of knowledge + intelligence + dedication. Managers need to work with their minds (application)

as well as with their heart (dedication).

4. Result oriented: - Every good manager, like an artist, is always practical and action based. Whatmatters is not just activities but accomplished of results. Emphasis needs to be placed on the

results rather than activities. The result of manager may be seen in the form of reduction in wastes,

optimum use of resources, motivated workforce, higher efficiency, etc.

5. Initiative: - Managers like artists take the initiative in doing the right things right at the right time.Good managers also encourage initiative on the part of their subordinates. The initiative helps to

take the right decisions, which in turn improves the overall performance of the organisation.

6. Intelligence: - Successful managers are intelligent. They need to have mental intelligence, socialintelligence, inter-personal intelligence and emotional intelligence.

They need to have more intelligence than their subordinates so as to command respect and get

the work done from them efficiently and effectively.

I4AR

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2. MANAGEMENT IS AN SCIENCE EXPLAIN

Meaning: - Science is a systematic body of knowledge which is universally accepted. F.W. Taylor

father of scientific management was perhaps the first person to consider management as a science.

He was of the opinion that management should conduct their business affairs by following certain

well established standards.

Science can be broadly divided into two groups:

(a) Physical Sciences (b) Social Sciences

Physical sciences like Physics, chemistry and mathematics are exact and accurate, whereas, socialsciences are not so exact and accurate as they deal with human beings.

Management is a social science because it deals with human beings. Since human nature cannot be

predicted with accuracy, the decisions taken in management may just be one way of doing things in agiven situation and not the only way of doing things.

Management is a social science due to the following reasons:

1. Systematic Decision-Making: -Management need to make systematic decisions. For thispurpose the managers need to collect the right information from the right source at the right time.The collected data need to be processed and analysed systematically. The systematic collection

and processing of data helps management to take better decisions.

2. Output may Vary, the Inputs Being the same: -In physical sciences, output may vary with achange in input. However, in social sciences, like management, output may vary without achange in input. For instance, when workers are properly motivated, their performance can

improve even without any increase in resources like material, time, etc.

3. Process of management is universally followed: - Managers in all organisations, whether largeor small, and at all levels, follow the process of management. All managers need to plan, to

organise, to direct and to control the activities.

4. Principles of Management are universally accepted: -All successful organisations do followthe well established principles of management, such as division of work, unity of command,

discipline, and so on.

However, the degree of application varies from one manager to another manager and from onesituation to another situation and from one organisation to another organisation.

Thus, it can be concluded that management is an art as well as a science. Managers need to bescientific artists in order to accomplish the goals. For this purpose, they need to be innovative,

and systematic. It is the science that discovers and the art that develops.

SOPP

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3. MANAGEMENT AS AN PROFESSION EXPLAIN

Meaning:-Profession is an occupation carried on by professional people like doctors, lawyers,

architects, etc. it involves application of expert knowledge to solve specific problems or to handle

specific tasks. There is a debate whether management is a profession or not. To find out whether

management is a profession, one needs to know features of professions.

Following are some of the important features ofprofessions

1. Formal Education: - a true professional needs to have minimum formal education from arecognised institution. For instance, a lawyer needs to have a degree in law from a recognised

university.

2. Fees: - The professional normally charges fees for their services rendered to the clients. The feesmay be varying from professional to professional. Normally, they do not work exclusively foronly one client. They have number of clients.

3. Expert Knowledge: - professional require expert knowledge in a particular discipline. Forinstance, a doctor needs to have expert knowledge in the field of medicine.

4. Requirement of Licence: - Professionals require a license or a permission to practice. Forinstance, a doctor requires a licence to practice as a medical practitioner.

5. Independent office: - Normally, the professionals practice from their own independent office.

6. Social Responsibility: - The professionals are socially responsible to their clients and to thesociety, while handling their tasks and responsibilities. Their actions should be guided not only

by monetary consideration, but also by social responsibility.

7.

Specialisation: - The professionals may specialise in a particular field. For instance, there may bedoctors only for a particular disease or for a particular class of patients. For instance, ther are

heart specialist, child specialist, etc.

8. Code of Conduct: -The actions of the professional are guided by a code of conduct. It is theassociation, either at national level or at state level that lays down certain standards to be

followed by the professionals.

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4. E PLAIN THE FUNCTIONS OF THETOP LEVEL MANAGEMENT? (March 2009)

Meaning: -All Managers in the organization do not belong to the same class or level, just as allstudents of a college do not belong to the same class. Managers belong to the higher levels, whereas,others belong to the lower level, and some others belong to the middle level. Every level of

management performs certain function. The function does vary from level to level.

Normally, management positions are graded into three broad levels, i.e.

1. Top Level1

2. Middle Level, and2

3. Lower Level.3

The functions ofToplevel Management are briefly explained as follows:

1. Mission Statement: - The top management frames mission statement of the organisation. Themission statement gives a clear direction to the activities of the organisation.

2. Plans and Policies: -The Top management frames plans and policies from long term point of view.The long term goals and objectives of the company are set by the top management.

3. Organising Resources: -The top management make arrangement of important physical, financialand other resources of the company.

4. Selection: -The top management has the responsibility of selecting departmental heads and otherkey executives.

5. Direction: -The top management provides necessary direction to the middle level executives toimplement the plans.

6. Control of Activities: -The top management designs and develops a system of monitoring,measurement and evaluation of performance.

7. Motivation: -The Top management has the responsibility to train and motivate key personnel ofthe organisation.

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5. E PLAIN THE FUNCTION OF THE MIDDLELEVEL MANAGEMENT

Meaning: -All Managers in the organization do not belong to the same class or level, just as allstudents of a college do not belong to the same class. Managers belong to the higher levels, whereas,

others belong to the lower level, and some others belong to the middle level. Every level of

management performs certain function. The function does vary from level to level.

Normally, management positions are graded into three broad levels, i.e.

1. Top Level1


3. Lower Level.3

The functions of Middle level Management are briefly explained as follows:

1. Planning: -The middle level management frames plans and policies for the departmental activities.They get the plans approved by top management.

2. Organising: -The middle management make arrangement of physical, financial and otherresources to undertake departmental activities.

3. Selection: -The middle level management undertakes the selection of lower level executives. Theyalso train the lower level executives.

4. Direction: -The middle level management provides direction to lower level executives toundertake the activities effectively.

5. Motivation: -The middle level management motivates the lower level executives so that theyperform efficiently and effectively.

6. Controlling: - The middle level management monitors and controls the departmental performance.

7. Reporting: -The middle level management report to the top management in respect ofdepartmental performance. They provide recommendation to the top management.

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Achieve success through OMT E@


6. E PLAIN THE FUNCTIONS OF THELOWERLEVEL MANAGEMENT

Introduction: -This level is also called Operational or supervisory Level of Management. This level

consists of Supervisors, Superintendents, foremen, Inspectors, etc. All Managers in the organization

do not belong to the same class or level, just as all students of a college do not belong to the same

class. Managers belong to the higher levels, whereas, others belong to the lower level, and some others

belong to the middle level. Every level of management performs certain function. The function does

vary from level to level.Normally, management positions are graded into three broad levels, i.e.

1. Top Level1


3. Lower Level.3

Their main Functions ofLower Level Management are as follows: -

1. Preparing plans: - They prepare plans regarding their work and allot the work to the workers.

2. Representing the problems of workers: -The supervisory level managers come to know theproblems and grievances of the subordinates and pas

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