KENDRIYA VIDYALAYA SANGTHAN

SILCHAR REGION
PRE-BOARD EXAMINATION - I
(2023-24)
BUSINESS STUDIES (054)
CLASS XII

Max Marks – 80 Time allowed: 3 Hours

General instructions:

1. This question paper contains 34 questions.

2. Marks are indicated against each question.

3. Answers should be brief and to the point.

4. Answers to the questions carrying 3 marks may be from 50 to 75 words.

5. Answers to the questions carrying 4 marks may be about 150 words.

6. Answers to the questions carrying 6 marks may be about 200 words.

7. Attempt all parts of the questions together.

a) Ravi is the Managing Director of Ionn Ltd., manufacturing different varieties

1. 1
of cheese. He has an efficient team working under him consisting of Lalit at,
the Production manager, Varun - the Marketing manager and Abhay - the
Finance manager. They understand and interpret the policies made by Ravi,
ensure that their departments have adequate manpower, assign them the
necessary duties and motivate them to achieve the desired objectives. Identify
the level of management they are working.

a) Top Level Management

b) Operational Management

c) All of these

d) Middle Level Management

2. What type of instruments are traded in a Money Market? 1

a) Call money
b) Commercial bills
c) All of these
d) Treasury bills

3. With the presence of women in the workforce, there has been a shift towards formal 1
wear, increased demand of electronic gadgets and increase in demand of cosmetics.

The related dimension of business environment referred in the above lines is:

a) Technological environment. b) Social environment

c) Political environment. d) Economic environment

4. _____ aims at reducing the cost of funds procured, keeping the risk under 1
control and achieving effective deployment of such funds.

a) Trading on Equity
b) Capital Structure
c) Financial planning
d) Financial management

5. SEBI calls for information and issues a show cause notice to stock exchange and its 1
officials seeking explanation and conducting audit and enquiry. Which function is
SEBI performing?

a) Regulatory function b) Development function

c) Protective function d) Both a) and c)

6. 1

Identify the point of significance of management illustrated in the picture.

a) Management helps in achieving group goals

b) Management helps in achieving personal objectives
c) Management helps in development of society
d) Management increases efficiency

7. The allocative function of Financial market helps in 1

a) Bringing transparency in trading procedure

b) Earning higher rate of return to household sector
c) Better functioning of depository
d) Determining the prices of securities

8. Nisha was working as a Human Resources Manager in a famous consultancy 1

firm, KLI Global Services. Her job included preparing job descriptions,
recruitment, developing compensation and incentive plans and facilitating
employees learning. They had entered into alliances with institutes to ensure
continuous learning of their employees. With the jobs becoming more and
more complex, KLI Global Services invested large amount of money in
making the employees learn the skills necessary to complete the jobs. Identify
the concept adopted by KLI Global Services.
 (a) Induction

b) Recuritment

c) Training

d) Selection

9. Which of the following statements is incorrect? 1

i. A low Debt Service Coverage Ratio indicates better ability to meet cash
commitments and consequently, the company's potential to increase
debt component in its capital structure.
ii. Use of higher debt increases the cost of equity.
iii. Low interest rates increase a firm's capacity to employ higher debt.
iv. None of the above

a) Option (i)
b) Option (ii)
c) Option (iv)
d) Option (iii)

10. Read the following statements: Assertion (A) and Reason(R). Choose the correct 1
alternative from those given below:

Assertion(A): Division of work is of great importance in Organising.

Reason(R): It makes sure that there is no duplication of work and no burden of

work on one person.

Alternatives:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct
explanation of Assertion (A)

c) Assertion (A) is true but Reason (R) is False

d) Assertion (A) is False but Reason (R) is True

11. Concentration of decision making functions at the apex of management 1
hierarchy is called

a) Decentralisation. b) Delegation

c) Organisational structure. d) Centralisation

12. There is more need of working capital in businesses where the demand to 1
be seasonal. What out of the following is the cause?

A. Capital remains stuck up for a long time in the raw material

B. Capital remains stuck up for a long time in the manufactured goods

C. More machines are needed

a) C and B
b) A and B
c) A and C
d) None of these

13. Statement I: Under the Consumer Protection Act 2019, a consumer 1

also includes any user of goods if such use is made with the approval
of the buyer.
Statement II: Any person who obtains goods or avails services for
resale or commercial purpose is nottreated as a consumer and is
outside the scope of Consumer Protection Act 2019.

a) Both the Statements I and II are not correct.

b) Statement II is correct and Statement I is not correct.
c) Both the Statements I and II are correct.
d) Statement I is correct and Statement II is not correct.
14. Mr. Vivek is working as the General Manager of Oshin Hotels Ltd. Mr. Vivek observed 1
that Government was taking a special interest in the Tourism industry as this sector
is an important source of foreign exchange and employment promotion. On the basis
of this news, the company decided to set up hotels at several tourist places. Oshin
Hotels Ltd. established 50 hotels before other companies considered this issue. Very
soon, this brand Oshin Hotels Ltd. became well known in the market. Identify the
importance of business environment described here.

a) It enables the firm to identify opportunities and getting the first mover
advantage.

b) It helps the firm to identify threats and early warning signals.

c) It helps in tapping useful resources.

d) It helps in improving performance.

15. When cost of debt is less than ROI, companies often employ more of 1
cheaper debt to enhance the EPS. Such practice is called ________.

a) Capital Structure
b) Trading on Equity
c) Financial planning
d) Financial management

Statement I: Marketing planning covers various important aspects

16. including the plan for increasing the level of production, promotion of the 1
products, etc., and specifies the action programmes to achieve these
objectives.
Statement II: Standardisation is the process of classification of products
into different groups, on the basis of some of its important characteristics
such as quality, size, etc.
a) Statement I is correct and Statement II is not correct.
b) Both the Statements I and II are not correct.
c) Statement II is correct and Statement I is not correct.
d) Both the Statements I and II are correct.
17. ‘Pace.’ is a reputed Chartered Accountant firm which renders services to big MNC’s. 1
The Chartered Accountants of the firm are required to travel to Delhi and NCR for
which they use company’s cars. The firm decided to convert its Petrol cars to Electric
cars in order to improve the quality of life of people. Identify the dimensions of
business environment.

a) Political and Legal environment

b) Legal and Social environment

c) Technological and Political environment

d) Social and Technological Environment

Match the following tools of promotion with their explanation and

18. 1
choose the correct option

A. It is undertaken by some identified 1 Personal selling

person /company who makes efforts and
bears the cost of it.
B. It plays an important role at the 2 Sales Promotion
awareness stage and develops product
preferences with the aim of
making sale.
C. It helps in managing public opinion 3 Advertising
and company’s relation with the public on
regular basis.
D. It uses tools specifically designed to 4 Public Relations
promote to customers, middlemen and
to salespersons.

a) A (3), B (1), C (4), D (2)

b) A (1), B (3), C (4), D (2)
c) A (2), B (3), C (4), D(1)
d) A (2), B (4), C (1), D (3)

19. What out of the following is the effect of optimal capital structure? 1
a) Increase in the value of equity share
b) Increase in shareholders wealth
c) All of these
d) Low financial risk
20. _____ standard is associated with production. 1
a) Quality and Quantity
b) Inventory
c) Labour
d) Liquidity

21. Captcha Ltd. is a construction company in which all the employees learn various 3
ways of dealing with diverse situations from their seniors. Company provides
financial as well as non-financial incentives. This helps the employees to grow and
develop their abilities. The organisation behaves as a responsible constituent of
society and always creates good quality products. It has a positive image in the
market. The training modules are excellent and the employees always try to find
unique ways of providing solutions in the context of rapidly changing business
environment. This has helped the organisation to adjust smoothly.

Identify and state three points of importance of management being highlighted here.

22. Give the meaning of Communication as an element of directing. 3

OR
Blue Birds Ltd. offers to its employees to issue shares at a price which is less
than the market price.
(i) Name and explain the type of incentive offered to the employees.
(ii) Explain one more incentive of the same category.
3

23. Resolutions Pvt. Ltd. is a publishing company. Its book on Business Studies for class 3
XII is in great demand. As a result, the employees in the marketing department are
always racing against time as they have to work overtime and on holidays as well to
cater to the demand. The work stress has led to dissatisfaction among the
employees of the marketing department.

1. Name and explain the step of staffing process which has not been performed
properly.

2. Also, explain the immediate next step in the process of staffing.

24. State any three points which highlight the importance of consumer protection from 3
consumer’s point of view.
OR
State how Government and Consumer Awareness Act could help in achieving the
objectives of consumer protection. 3

25. Explain the following features of Directing 4

a) Directing initiates action

b) Directing is a continuous process

OR
Explain the following leadership styles:
4
a) Autocratic leadership
b) Laissez Faire leadership

State any four limitations of using internal sources of recruitment.

26. 4
OR
State any four commonly used sources of recruiting employees from outside
the organisation.
4

27 Mr. Akshay, a 20 year old college student purchased a book online from XYZ 4
Pvt Ltd and when it was delivered, he noticed that there was no MRP
mentioned on it. He browsed the internet and found that the book was sold
at different prices in different places. He filed a case in District forum against
the publisher. The court held in favour of Akshay and awarded a
compensation of
₹10,000.

a) Identify and state the consumer right violated in the above case.
b) Name and explain the right exercised by Mr. Akshay.

28. Explain the following factors affecting the dividend decision of the company: 4

a) Taxation Policy
b) Cash Flow Position
29. Identify and state the various elements of communication highlighted in the following 4
cases:

(i) Department 'A' has sent an encoded message to department 'B' through internet.
What is the role of internet here?

(ii) Madhur is making gestures so that he can send a message to Ranbhir. What is
Madhur doing here?

(iii) Ranbhir is trying to understand the message sent by Madhur by reading his
gestures. What is Ranbhir doing here?

(iv) Kamesh picks up his phone and finds a message on it. He reads the message
carefully. What is the role of Kamesh here?

30. Dhaval Acharya, after acquiring a bachelor’s degree in Hotel Management joined his 4
father’s chain of vegetarian restaurants in Ahmednagar. Being young and
enterprising, he suggested his father to add a new section of vegetarian bakery items
which required an investment of ₹ 5 crores. His father Mr. Aariketh Acharya
suggested him to take the decision with caution and understood everything
comprehensively as bad decision may damage the financial fortune of business.

Identify the decision suggested by Mr. Aariketh Acharya. State by giving any three
reasons as to why he must have advised his son to take decision with caution.

1) Explain any two techniques of Scientific Management from the following:

31. a) Method study 3+3=6
b) Motion study
c) Time study

2) Differentiate between Unity of Command and Unity of Direction on any three

basis.
OR
1) Explain any two principles of Fayol from the following: 3+3=6
a) Discipline
b) Order
c) Initiative

2) Differentiate between contributions made by F.W.Taylor and Henry Fayol on any

three basis.
32. Explain the steps that are required to be performed by a manager before evaluating 6
all possible courses of action in planning process.

OR

Explain how planning: 6

a) Reduces overlapping and wasteful activities

b) Establishes standards for controlling
c) Facilitates decision making

33. Read the statements given in point 1 and 2, answer the questions that follow: 3+3=6

1) Tea is produced in Assam but is carried to customers not only in this

state but also in other parts of the country.

a) Identify and explain the function of marketing that enables the marketer to
achieve its goals.

b) Enumerate any two factors that marketer should take into consideration in
order to analyse the identified needs.

2) Paddy is grown during summer season but its demand and sale takes
place throughout the year.
a) Name and state the function of marketing which should be undertaken to
reduce the gap between production and consumption of Paddy.
b) State by giving two reasons as to why proper discharge of this function is
important.
6
34. Diligent developers, a website design company in Bangalore is a startup initiative of
Mr. Maniraj which aims at achieving a profit margin of 10% in its first year. Mr.
Maniraj appointed Mr. Advait as the Digital marketing Head, Mr. Kiyansh as the head
of Backend department and Mr. Nirved headed the Graphics Designing Department.
Since each head was specialised in specific skills, it resulted in increased efficiency
and better coordination.

However, problems arose when Mr. Advait started considering group objectives
superior to organisational objectives and stopped exchanging information with Mr.
Kiyansh and Mr. Nirved. The company had to bear the brunt of lack of coordination
and was unable to achieve its objectives.
a) Identify and state the organisational structure adopted by the company.
b) State two benefits and two limitations of the identified structure highlighted in
the above case.

ALL THE BEST

 KENDRIYA VIDYALAYA SANGTHAN
SILCHAR REGION
PRE-BOARD EXAMINATION - I
(2023-24)
MARKING SCHEME
BUSINESS STUDIES (054)
CLASS XII

Answers:
Marks

(d) Middle Level Management

1 1

2 (c) All of these. 1

(b) Social environment

3 1

(d) Financial management

4 1

a) Regulatory function
5 1

6 a) Management helps in achieving group goals 1

b) Earning higher rate of return to household sector

7 1

8 (c) Training 1
9 (a) Option (i) 1

10 a) Both Assertion (A) and Reason (R) are true and Reason (R) is the 1
correct explanation of Assertion (A).

11 d) Centralisation 1

(b) A and B
12 1

13 (c) Both the Statements I and II are correct. 1

14 a) It enables the firm to identify opportunities and getting the first 1

mover advantage.

(b) Trading on Equity

15 1

16 (a) Statement I is correct and Statement II is not correct 1

17 d) Social and Technological Environment 1

 a) A (3), B (1), C (4), D (2)
18 1

(c) All of these

19 1

(a) Quality and Quantity

20 1

21 The importance of management highlighted: 1/2mark each

for
1. Helps in achieving personal objectives– A manager identification
motivates and leads his team in such a manner that and 1/2 mark
individual members are able to achieve personal goals while each for
contributing to the overall organizational goals. stating 3
2. Helps in the development of society- The organisation tries to identified
behave as responsible constituent of society and always points
creates good quality products.
3.Creates a dynamic organisation- Organisations have to
function in a constantly changing environment. Management
helps people adapt to the changes so that organisation is
able to maintain a competitive edge.

22 Communication is a process of exchange of ideas, views, facts,

feelings etc between or among people to create common
understanding. There are two forms of Organisational
communication:
i. Formal communication 1 ½ mark
ii. Informal Communication for each
OR
(i) The name of the incentive offered is Stock Options. Under these
incentives schemes, employees are offered company shares at
set price which is lower than market price. Sometimes,
management may allot shares in line of various incentives
payable in cash.The allotment of shares creates a feeling of
ownership to the employees and makes them to contribute for
the growth of the organisation.
(ii) Retirement benefits: Several retirement benefits such as
provident fund, pension and gratuity provide financial security to
employees after their retirement. This acts as an incentive when
they are in service in the organisation. OR
 ADVANTAGES OF MANAGEMENT BY EXCEPTION:
1) It saves the time and efforts of managers as they deal with only
significant deviations 1 mark each
2) It focuses managerial attention on important areas. There is for stating
better utilization of managerial talent. any 3 points
3) The routine problems are left to the subordinates. Thus, it
facilitates delegation of authority and increases morale of
employees.
4) It identifies critical problems which need timely action to keep
the organisation in right direction.
The step of staffing process which has not been performed
23 properly is:
1 mark for
(i) Estimation of manpower requirements: Operationally, understanding
identification
the manpower requirements would necessitate workload analysis on and I mark
the one hand and workforce analysis on the other. for
explanation
(ii) The next stage immediately following the step Estimation of
manpower requirement is as follows: +
Recruitment: Recruitment may be defined as the process of searching 1 mark for
for prospective employees and stimulating them to apply for jobs in the explaining
organisation. next step
24 Importance of consumer protection from consumer's point of view is
i. Spreading Awareness among the Consumers: Due
to widespread ignorance of consumers about their
1 mark each
rights and reliefs available to them, they need to be
for stating
made aware in this regard Consumer protection
any 3 points
provides information to the ignorant consumers
regarding their rights and reliefs available to them. With
this, even the sellers who try to cheat the ignorant and
illiterate consumers, become conscious and mend their
ways.
ii. Unorganized consumers: Consumers need to be
organized for safeguarding their interests. In
developing countries like India, consumérs are not
organized. In other words, there is a dearth of a
National Level Consumer Organization. There are very
few consumer organizations which are working to
protect the interests of consumérs. Consumer
protection encourages the establishment of more
consumer organizations.
iii. Widespread exploitation of consumers: Consumers
is exploited by unscrupulous, exploitative and unfair
trade practices of sellers. They might be exploited by
unfair trade practices like defective and unsafe
products, adulteration, hoarding, black marketing, etc.
Consumers need protection against such unfair trade
practices. Consumer protection has been a support
system for all such consumers to protect their interests
and provide them justice.
OR
i. Government The government can protect the interests of the OR
consumers by enacting various legislations. The legal framework in
India encompasses various legislations, which could provide protection
to consumers. The most important of these regulations is the
Consumer Protection Act, 1986, which provides three-tier machinery
for redressal of consumer grievances. The Government has the
responsibility of safety and security of its people and therefore it must
frame such laws which could make the sellers refrain from various
malpractices.
ii. Consumer Awareness Act: A consumer, who is well-informed about
his rights and his reliefs available to him, would be in a position to raise
his voice against unfair trade practices or unscrupulous exploitation. This
would enable him to safeguard his interests. Consumer Awareness Act,
provides the consumer a platform to raise his voice against any form of 1 ½ mark
malpractice. each for
stating each
step
25 a) Directinginitiates action-Directing is a key managerial function. A
manager has to perform this function along with planning, organizing, 2 marks each
staffing and controlling while discharging his duties in the for explaining
organization. points.

b) Directing is a continuous activity- It takes place throughout the life of

organization irrespective of people occupying managerial positions.

OR

a) Autocraticor Authoritarian leadership style-An autocratic leader gives

orders and expects his subordinates to obey those orders. This
leadership style is effective in getting productivity in many situations
2 marks each
like in a factory where the supervisor is responsible for production on
time and has to ensure labour productivity. Quick decision- making is for explaining
also facilitated. leadership
styles
b) Laissez fair or Free-rein leader-Such a leader does not believe in the use
of power unless it is absolutely essential.The followers are given high
degree of independence to formulate their own objectives or ways to
achieve them. The manager is only there to support them and supply
them the required information to complete the task assigned.
 Limitations of using internal sources of recruitment are as follows:
26 1. When vacancies are filled through internal promotions, the scope 1 mark each
for induction of fresh talent is reduced. Hence, complete reliance for stating
on internal recruitment involves danger of ‘inbreeding’ by any 4
stopping ‘infusion of new blood’ into the organization. limitations

2. The employees may become lethargic if they are sure of time

bound promotions;
3. A new enterprise cannot use internal sources of recruitment.
No organisation can fill all its vacancies from internal sources;
4. The spirit of competition among the employees may be
hampered; and
5. Frequent transfers of employees may often reduce the
productivity of the organisation.
OR

Commonly used sources of recruiting the employees from outside the

organization (any 4)
Direct recruitment- A notice is placed on the notice board of the
enterprise specifying the details of the jobs available. Job-seekers
assemble outside the premises of the organisation on the specified
date and selection is done on the spot. It is suitable for filling casual
vacancies when there is a rush of work or when some permanent
workers are absent.
Casual Callers - Many reputed business organizations keep a
database of unsolicited applicants in their offices. A list of such job-
seekers can be prepared and can be screened to fill the vacancies as
they arise. Most of the senior positions of industry as well as
commerce are filled by this method. The advantage of advertising
vacancies is that more information about the organization and job can
be given in the advertisement. . 1 mark each
Employment exchange- Employment exchange run by a government for stating
are a good source of recruitment for unskilled and skilled operative any 4
jobs. They help to match personnel demand and supply by serving as external
a link between job-seekers and employers. sources
Placement Agencies and management consultants- Placement
agencies provide a nationwide service in matching personnel demand
and supply. Management consultancy firms help the organization to
recruit technical, professional and managerial personnel.

Campus recruitment-Many big organisations maintain a close liaison

with the universities, vocational schools and management institutes to
recruit qualified personnel for various jobs.
Recommendation of employees – Applicants introduced by present
employees, or their friends and relatives may prove to be a good
source of recruitment. Such applicants are likely to be good
employees because their background is sufficiently known.
Labour Contractors – Labour contractors maintain close contacts with
labourers and they can provide the required number of unskilled
workers at short notice.
Advertising on Television- The detailed requirements of the job and
the qualities required to do it are publicized along with the profile of
the organization where vacancy exist .
Web publishing- Internet is becoming a common source of
recruitment these days. There are certain websites specifically
designed and dedicated for the purpose of providing information
about both job-seekers and job opening.
 a) Right to be informed :Every consumer has a right to have complete
27 information about the product he intends to buy including its 1 mark each
ingredients, date of manufacture, price, quantity, directions for use for
etc. identification

+
b) Right to seek redressal: This states that every consumer has the right
to get relief in case the product or service falls short of expectations. 1 mark each
for
explanation
 Taxation policy: If tax on dividend is higher, it is better to pay less by
28 way of dividends. Though dividends are free of tax in the hands of 2 marks each
shareholders, a dividend distribution tax is levied on companies. Under for explaining
the present tax policy, shareholders are likely to prefer higher
dividends.

Cash flow position: The payment of dividend involves an outflow of

cash. Availability of enough cash in the company is necessary for
declaration of dividend.
 1. Media- It is the path through which encoded message is transmitted
29 to receiver. The channel maybe in the written form, face to face, phone
call, internet.

2. Encoding- It is a process of converting the message into ½ mark each

communication symbols like words, pictures, gestures etc. for
3. Decoding- It is a process of converting encoded symbols of the identification
sender. and ½ mark
4. Receiver- The person who receives communication of the sender. for stating
30 Mr Aariketh Acharya has suggested capital budgeting decision. 1 mark for
identification
Reasons why he must have advised this decision are:
+
1. These decisions have bearing on the long-term growth. They
affect the future prospects of the business. 1 mark each
2. These decisions result in large portion of funds being blocked in for stating
long term projects, these investments are planned after a any 3 points
detailed analysis.
3. These decisions affect the returns of the firm, therefore influence
the overall business risk complexion of the firm.
4. These decisions once taken, are not reversible without incurring
heavy losses. Abandoning a project after heavy investment is
costly in terms of waste of funds.
31
a) Method Study: The objective of method study is to find out one
best way of doing the job. There are various methods of doing
the job. To determine the best way there are several parameters.
Right from procurement of raw materials till the final product is
delivered to the customer every activity is part of method study.
The objective of the whole exercise is to minimise the cost of 11/2 marks
production and maximise the quality and satisfaction of the each for
customer. For this purpose, many techniques like process charts explaining
and operations research etc., are used.
any 2
b) Motion Study: Motion study refers to the study of movements techniques
like lifting, putting objects, sitting and changing positions etc., +
which are undertaken while doing a typical job. Unnecessary 1 mark each
movements are sought to be eliminated so that it takes less time for any 3
to complete the job efficiently. On close examination of body differences
motions, for example, it is possible to find out: (i) Motions which
are productive (ii) Motions which are incidental (e.g., going to
stores) (iii) Motions which are unproductive.

c) Time Study: It determines the standard time taken to perform a

well-defined job. Time measuring devices are used for each
element of task. The standard time is fixed for the whole of the
task by taking several readings. The method of time study will
depend upon volume and frequency of the task, the cycle time
of the operation and time measurement costs. The objective of
time study is to determine the number of workers to be
employed; frame suitable incentive schemes and determine
labour costs.

b)

BASIS UNITY OF UNITY OF

COMMAND DIRECTION

1.Meaning One subordinate Each group of

should receive orders activities having same
from and should be objective must have
responsible to only one head and one plan
one superior.

2.Aim It prevents dual It prevents

subordination. overlapping of
 activities

3.Implications It affects an It affects the entire

individual employee organisation.

OR

a. Discipline: Discipline is the obedience to organisational rules

and employment agreement which are necessary for the
working of the organisation. According to Fayol, discipline
requires good superiors at all levels, clear and fair agreements
and judicious application of penalties.

b. Order: According to Fayol, “People and materials must be in

suitable places at appropriate time for maximum efficiency.” The
principle of order states that ‘A place for everything (everyone)
and everything (everyone) in its (her/his) place’.If there is a fixed
place for everything and it is present there, then there will be no
hindrance in the activities of business/ factory. This will lead to 11/2 marks
increased productivity and efficiency.
each for
c. Initative: Workers should be encouraged to develop and carry explaining
out their plans for improvements according to Fayol. Initiative any 2
means taking the first step with self-motivation. It is thinking out principles
and executing the plan. Initiative should be encouraged. But it +
does not mean going against the established practices of the 1 mark each
company for the sake of being different. A good company should
for any 3
have an employee suggestion system whereby initiative/
suggestions which result in substantial cost/time reduction differences
should be rewarded.

II.Basis of Difference Henri Fayol F.W Taylor

Perspective Top level of Shop floor level of

Management a factory.

Unity of Command Staunch Proponent Did not feel that it

is important as
under functional
foremanship a
worker receives
 orders from eight
specialists

Applicability Applicable Applicable to

Universally specialized
situations

Basis of Formation Personal Experience Observation and

Experimentation

Focus Improving Overall Increasing

administration Productivity

Personality Practitioner Scientist

Expression General theory of Scientific

Administration Management
32 Steps in planning process

1. Setting objectives: Objectives or goals specify what the 2 marks

organisation wants to achieve. They give direction to all each for
departments and must be stated clearly. They may be set for the explaining
entire organisation and each department within the organisation first 3 steps
2. Developing premises: Planning is concerned with future which
is uncertain, therefore manager has to make certain
assumptions about future. Assumptions are base material upon
which plans are drawn which may be in the form of forecasts,
existing plans or past information about policies.
3. Identifying alternative courses of action: Once objectives are set
and assumptions are made, next step is to identify alternative
courses of action. The course of action may be routine or
innovative. An innovative course may be adopted by involving
more people and sharing their ideas.

OR

1) Planning reduces overlapping and wasteful activities

Planning serves as a basis of coordinating the activities and efforts of 2 marks each
different divisions, departments and sections. Since planning ensures for explaining
clarity in thought and action, work is carried out smoothly without
interruptions. 3 points

2) Planning establishes standards of controlling

Planning provides the goals against which actual performance is

measured. Through comparison, managers can know whether they are
actually able to achieve the goals. Deviations, if any can be corrected.
Thus planning is a prerequisite for controlling. The nature of deviations
depends upon the extent of deviations from the standard.

3) Planning facilitates decision making

Planning helps managers to look into the future and make a choice from
amongst various alternative courses of action. The manager has to
evaluate each alternate and select the most viable proposition.
 a) The function of marketing that enables the marketer to achieve
33 its goals is Transportation. a)1 mark for
identification
It involves physical movement of goods from one place to another.
Since the user of products are wide spread and geographically +
separated from the place where they are produced it is necessary to
move them to the place where they are needed for consumption. 1 mark for
stating
b)The factors that should be taken into consideration to analyse the
marketing needs are nature of the product, cost and location of target b) ½ mark
market. each for
enumerating
c) The function of marketing that reduces the gap between production any 2 points
and consumption of paddy is Storage or Warehousing.
c) 1 mark for
Due to irregular demand or supply, there may be time gap between identification
production of goods and their sale. Storage helps in reducing the time + 1 mark for
gap between production and consumption and provides time utility. stating + 1/2
mark each
Importance of warehousing: for stating
any 2points
1. To ensure smooth flow of products in the market
2. To protect against any unavoidable delays in delivery or meet
contingencies in demand.
 a) The organisational structure adopted by Diligent Developers is a. 1
34 Functional structure . Functional structure is an organisational design mark for
that groups similar or related jobs together. identification
b) Benefits of functional structure: + 1 mark for
stating

1) It leads to occupational specialization since emphasis is placed on

specific functions.This promotes efficiency in utilization of manpower as b 2 marks
employees perform similar tasks within a department and are able to each for
improve performance. stating 2
points of
benefits and
2) It promotes control and coordination within a department because of limitations.
similarity in the tasks being performed.

Limitations of functional structure:

(a) A functional structure places less emphasis on overall enterprise

objectives than the objectives pursued by a functional head. Such
practices may lead to functional empires wherein the importance of a
particular function may be overemphasised. Pursuing departmental
interests at the cost of organisational interests can also hinder the
interaction between two or more departments.

(b) It may lead to problems in coordination as information has to be

exchanged across functionally differentiated departments