Hello and welcome to FinanceBread. Today’s topic is Nature and Significance of management class 12. This post is filled with case studies and notes.
Before actually diving into Nature and Significance of management of class 12 and case studies. I think its good to let you know what you can expect from FinanceBread in the coming few weeks.
So honestly speaking I was out of ideas for writing a post and when I was brainstorming I accidentally met my class 12 business studies book.
I really loved it and not to brag about it because many of you absolutely got good marks than me in boards.
But I was able to secure 82 in business studies in class 12 and I didn’t attend any coaching classes in whole 11th and 12th standard and also 2nd semester of 10th class.
I am not going to lie to you, I failed in my 11th Accounts and Economics but my year was not wasted because of re-exam.
The thing I am really trying to convince you here is when I looked back yesterday and searching for my post ideas I wasn’t able to get any.
One thing that always stays with me till now is Business Studies and that alone made me chose to do BBA as higher studies.
You know that colleges and other institutions are closed and right now I don’t have my BBA semester subject so I thought of going through again my 12th standard business studies book and I know that you might be thinking that this post is just a copy-paste of the text of a chapter.
In a way YES, you are right and this type of content does not appeal to many internet users and I don’t get any traffic to my site.
If that the case so be it.
If you are reading till here I would like to take a moment and say thanks to you and it would be great help if you read full post and I promise that you will get the memories back if you are commerce student when you were hyped about how your year is going to be (including myself ) and you read first chapter by heart and made beautiful notes of chapter.
Again you are right, but if I am not wrong if you ever spent time on those platforms you were provided with very few topics with no case studies and just notes with topics like characteristics of management, the importance of management, etc and most of them provide pdf which is just plain text
Please do comment at the end of the post if you like, if you like it and share it with your friends and especially if they are in 12th class.
Don’t worry every intro in coming posts is not going to be this long. Today I wanted to have a little conversation with you as my reader and provide you with some ideas of what you can expect.
I am writing this post almost after 14-15 days since my last post.
Enough of my side now I know this is not a vlog.
Throughout the post you will be coming across graphics, case studies, and illustration to give you a better understanding.
Every word and visual I typed and designed by myself. So please if you like do consider sharing it and please show FinanceBread support through your comment.
Let’s start with the Nature and Significance of management class 12 and other concepts of Management.
CONCEPT OF MANAGEMENT
Management is an activity that is necessary wherever there is a group of people working in an organization. People in organizations are performing diverse tasks but they are all working towards the same goal.
Management aims at guiding their efforts towards achieving a common objective – a goal.
Management is necessary so that individuals make their best contributions towards group objectives.
Now, let’s know some definitions given by some pioneers of management.
DEFINITIONS OF MANAGEMENT
” Management is the process of working with and through others to effectively achieve organizational objectives by efficiently using limited sources in the changing environment”.
” Management is the process by which a cooperative group directs actions of others toward common goal”.
-Massie and Douglas
Management is defined as a process of getting things done with the aim of achieving goals effectively and efficiently.
For better understanding, we have to take a deeper look in the above three bold words i.e. process, effectively, and efficiently.
It means the primary function or activities that management performs to get things done. These functions are planning, organising, staffing, directing and controlling.
These interconnected and interdependent functions are part of management.
These five functions are very important and incoming posts you and I will be studying each of them as a separate chapter. So it’s better to have a brief understanding of them so that it helps you in future posts.
Planning is the function of determining in advance what is to be done and how it is to be done.
This involves setting objectives and targets in advance and formulating an action plan to achieve them effectively and efficiently.
Planning cannot prevent problems, but it can predict them and prepare emergency plans to deal with them, if and when they occur.
If you are going to do BBA in the future, then planning is going to be a whole chapter of your first semester in business organization and most of the topics will remain the same.
So its better to learn this chapter by heart with our current post Nature and Significance of management class 12.
Organising is the management function of assigning duties, grouping tasks, establishing reporting relationships and allocating resources required to carry out a specific plan.
It determines what activities and resources are required. It decides who will do to a particular task, where it will be done, and when it be done.
Staffing simply means finding the right people for the right job, with the right qualification are available at the right places and times to accomplish the goals of the organisation.
It is the function of management is also known as human resource function.
Directing is leading, influencing and motivating employees to perform the tasks assigned to them.
This requires establishing an atmosphere that encourages employees to do their best.
Motivation and leadership are two keys components of directing.
Directing also involves communicating effectively as well as supervising employees at work.
Thus, there are four elements of directing viz. Motivation, Leadership, Communication, and Supervision.
Controlling is the management function of monitoring organisational function towards the attainment of organisational goals.
It involves establishing standards of performance, measuring actual performance, comparing it with established standards of function, and taking corrective action when any significant derivation is found.
Here, management must determines what activities and outputs are critical to success, how and where they can be measured and who have the authority to take corrective action
It is concerned with doing the right task, completing activities, and achieving goals.
In other words, it is concerned with the end result, i.e., finishing the given task
It means doing the task correctly and with minimum cost.
Efficiency is increased if
- by using fewer inputs such as money, materials, equipment, and persons, more output is produced; or
- for the same output, fewer resources are used and fewer costs are incurred,
The two terms ‘Effectiveness’ and ‘ Efficiency’ are different but they are inter-related. For management, it is important to be both effective and efficient.
Management has to seek the tasks that are completed and goals are achieved (i.e., effectiveness and with the least amount of resources at a minimum cost (i.e., efficiency).
Effectiveness and Efficiency are two sides of the same coin.
NATURE AND SIGNIFICANCE OF MANAGEMENT AS SCIENCE, ART, AND PROFESSION notes
Management as a Science
Science is a systemised body of knowledge that explains certain general truths or the operation of general laws.
The basic features of science are as follows:-
Systemized body of knowledge:
Scientific principles are based on cause and effect relationships.
Principles based on experimentation:
Scientific principles are first developed through observation and then tested through repeated experimentation.
Scientific principles have universal validity and application.
Conclusion: Management is an inexact science. It is neither as precise nor as comprehensive as the pure science like Physics or Chemistry.
Management as an Art
Art is the skillful and personal applicaton of existign knowledge to achieve desired results. It can be acquired through studfy, observation and experience.
The basic features of art are as follows:
Existence of theorotical knowledge:
Any art (like dancing, public speaking, acting or music) presupposed the existence of certain theoritical knowledge.
The use of basic knowledge varies from individual to individual. Art is therefore, a very very personalised concept.
For example, two dancers, two speakers, two actors will always differ in their work.
Based on continuous practice:
Art is the continuous practice of existing knowledge.
Art involves creativity. For example, the musician makes a unique composition based on seven basic notes.
Management as a Profession
A proffession has the following characteristics:
Well- defined body of knowledge:
All professions (legal, medical, accounting, etc) are based on well-defined body of knowledge.
The entry to a profession is restricted through an examination or through acquiring an educational degree.
All professionals are affiliated to a professional association that regulates entry, grants certificate of practice, and formulates and enforces a code of conduct.
Ethical code of conduct:
All professionals are bound by code of conduct which guides the behaviour of its members.
For example, all doctors take the oath of ethical practice at the time they enter the profession.
The basic motive of a profession is to serve their clients’ interests by rendering dedicated and committed service
By now you should get really familiar with Nature and Significance of management class 12 but don’t stop here keep reading.
You are almost half way through the post.
CHARACTERISTICS/FEATURES OF MANAGEMENT
1. Management is a goal-oriented process
Management has a set of goals which are the basic reasons for its existence. These should be simple and clearly stated.
Management unites the effort of different individuals in the organisation towards achieving goals.
2. Management is a group activity
An organisation is a group of people who work together with team spirit and coordination to achieve the goals of the organisation.
This focuses on a team rather than individuals.
Management as a group (or team) can contribute more effectively and efficiently than an individual.
3. Management is an intangible force
Management cannot be seen but its presence can be felt when targets are achieved according to plans, employees ae happy and satisfied, and there is orderliness instead of chaos.
4. Management is all pervasive
Managerial activities are performed in all types of organisation, in all departments and at all levels.
Management is essential for all organisations – big or small, profit or non-profit, service or manufacturing.
5. Management is multi dimensional
Management is multi-dimensional as it involves the management of people, management of work, and management of operations.
6. Management is a continuous process
Management process is a series of continuous composite but seperate functions – planning, organising, staffing, directing and controlling.
These functions are performed by all managers at all times.
7. Management is a dynamic function
It adapts itself t the changing environment. An organization interacts with its external environment which consists of various economic, social, legal, technological, and political factors.
In order to be successfull, an organisation must change itself and its goals according to the needs of the environment.
For example, McDonald’s the fast-food giant, made major changes in its menu to be able to survive in the Indian market, e.g. it offers Aloo Tikki, burger.
OBJECTIVES OF MANAGEMENT
Management seeks to achieve certian objectives which are desired result of any activity. They must be derived from the basic purpose of business.
Objectives of management can be defined into organisational objectives, social objectives and personal objectives.
Organizational or Economic Objectives
The main objective of any organization should be to utilize human and material resources to the maximum possible advantage, i.e., to fulfill the economic objectives of the business.
These are survival, profit and Growth.
Survival – Management of an organization must ensure the survival of the organization by earning enough revenue to cover costs.
Profit – Mere survival is not enough. Management must ensure that organisation makes a profit, which is an incentive for the continued successful operations of the enterprise.
Profit is essential to cover the costs and risks of the business.
Growth – It is important for every business to grow in the long term. Management must exploit fully the growth potential of the organization.
Growth of the business can be measured in terms of
(a) increase in sales turnover
(b) increase in number of products
(c) increase in number of employees
(d) increase in capital investment
The social objectives of management involve the creation of benefits or economic value for society. This includes
- using environmental friendly methods of production
- providing basic amenities like schools and creches to employees
- giving employment opportunities to the disadvantaged sections of society.
Personal objectives of management are concerned with satisfying the diverse needs of the employees such as
- financial needs by giving them competitive salary and perks
- social needs such as peer recognition
- higher-level needs such as personal growth and development
IMPORTANCE OF MANAGEMENT
Succesful organisations do not achieve their goals by chance by following a deliberate process called ‘management’.
A business enterprise rises to the top because of its quality of management.
On the other hand, lack of proper management results in wastage of time, money and efforts.
Studies have shown that 90% of the businesses generally fail due to poor management. Therefore, it is said : “Anything minus management is nothing”.
Management is the life giving element in every business. Without it, the resources of the production remains resources and shall never become production– Peter Drucker
An organization has set goals to achieve, e.g., to earn 20% Return n Investment (ROI), increasing sales by 10%, etc.
Management aims at achieving these goals by giving a common direction to the individual efforts.
Importance of management plays a crucial role in overall management and the Nature and Significance of management that you studied in class 12
The good thing is, these are very much related to each other so you will be not having any problem in understanding them.
1. Management increases efficiency by reducing costs and increasing productivity through better planning, organizing, staffing, directing, and controlling the activities of the organization.
2. Management helps in achieving personal objectives.
A manager motivates and lead his team in such a manner that individual members are able to achieve prsonal goals while contributing to the overall objective of the organisation.
3. Management helps in the development of society by
- providing good quality products and services
- creating employment opportunities
- adopting new technology, etc.
4. Management creates a dynamic organization
All organization has to function in an environment which is constantly changing in order to be successful, an organization must change itself and its goals according to the needs of the environment.
LEVELS OF MANAGEMENT
Management is a universal term used for certain functions performed by individuals in an organisation who are bound together in a hierarchy of relationships.
Every individual in the organisation is responsible to successful completion of the particular task.
It gives rise to the different levels of management in an organisation.
Top Management consists of :
- Chief Operating Officer
- Chief Executive Offer (CEO)
- Chief Marketing Officer (CMO)
- Chief Financial Officer (CFO)
- Managing Director
- To formulate overall organisational goals and strategies for their achievement
- To be responsible for welfare and survival of the organisation
Middle maangement is the link between top and lowert level managers.
They are subordinates to top managers and superiors to first line managers.
Middle management is responsible for implementing and controlling plans and strtategies developed by top management. At the same time they are responsible for the activities of first line managers.
Middle management consists of:
- Human Resource Manager (HR)
- Production Manager
- Marketing Manager
- Finance Manager
- Operations Manager
- Plant Superintendent
- Regional Manager
- Divisional Manager
- To interpret policies framed by top management
- To cooperate with other departments for the smooth functioning of the organization
Operational or Supervisory Management
It refers to the lower level in the hierarchy of the organisation.
Foreman and Supervisors comprise operational management.
- Supervisors directly oversee the efforts of the workforce. Their authority and responsibility are limited according to the plans laid down by top management.
- The quality and quantity of output depend upon the hard work, discipline, and loyalty of the workers.
CONCEPT OF COORDINATION
Coordination is the process by which activities of different departments are synchronised to ensure unity of action.
For example, suppose in a company, the sales department has recieved an order of 10000 units. It cannot execute the order unless production department produces 10000 units. The production department cannot produce 10000 units unless purchase department purchases raw material and provides the same to the production department.
Thus,if production and sales plans arenot properly cordinated, objectives in respect of these activities of the enterprise cannot be efficiently accomplished.
Coordination is the last concept in our today’s post on Nature and Significance of management class 12.
Coordination’s features are very much like features of management and as you read further you will come to know that it is a part or concept of management.
” Coordination harmonises, synchronises and unifies individual efforts for better action and for the achievement of the business objective”.– Henry Fayol
“Coordination is the process whereby an executive develops an orderly pattern of group efforts among his subordianated and secures unity of action in pursuit of common purposes.”– McFarland
Need and Importance of Coordination
Coordination is sometimes considered a separate function of management. It is, however, the essence of management, for achieving harmony among the individual efforts towards the accomplishment of group goals.
Growth in Size
As an organization grows in size, the number of people employed by it also increases. At times it may become difficult to integrate their efforts and activities.
For management it is necessary to ensure that all individuals work towards the common goals of organisation.
But employees may have their personal goals also.
Thus, for the organization it is important to harmonize individual goals and organizational goals through coordination.
In an organisation, there may be seperate departments of the production, finance, marketing, and human resource departments. All these departments have thier own objectives, policies, strategies etc. So, htere may arise conflict between them.
Therefore, coordination is needed to ensure unity of action by acting as a binding force between departments and to avoid conflicts between them.
In modern organisations, there is high degree of specialisation. Specialisation arises out of the complexities of modern technology and th ediversity of taks to be performed.
Therefore organisations need to employ specialist.
They do not take advice or suggestions from the other members of the organisations. This often leads to conflict between them.
Therefore, coordination is required to avoid conflict between the specialists and other members of the organization.
A while ago I wrote a post on Financial market and I mentioned some basic concepts with diagrams and other related topics.
If you are interested, you can go to that post through What is Financial Market?
So thats it for today post on Nature and Significance of management class 12.
I hope that you liked this post and got answers for what you were looking for.
Please provide us your suggestion so, that FinanceBread can provide better and help you more efficiently.
This post took 4 days to complete with writing and picking only those topics which are relevant and making graphics, case studies.
Most of us know but in case you like any of the above graphics and wondering how I made it.
For that I always use Canva.
Again friends if you like this post and my work. Please do consider sharing it and showing us your support through the following platforms:-
Facebook – https://www.facebook.com/FinanceBread2020/
Pinterest – https://in.pinterest.com/FinanceBread/pins/
Twitter – https://twitter.com/financebread
Youtube – https://www.youtube.com/channel/UCX6x-1Hp0FBAj-vRuLjfWnA or you can check this video (url may not work).
Your participation and suggestion is very important for keep me going.
In next 2-3 months I will provide a beginner basic course on Investing which makes you familiar with some terms like MF, stocks etc and explaination is going to be very basic.
Before going I just want to say a famous line from Tom Bilyeu’s Impact theory i.e, having potential is totally different than doing something with it.
Just do what you feel whats good for you and keep yourself happy.
Thanks and take care.
Have a good day and keep making yourself more skilled and powerful.