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Case Study Chapter 2 Principles of Management

Please refer to Chapter 2 Principles of Management Case Study Questions with answers provided below. We have provided Case Study Questions for Class 12 Business Studies for all chapters as per CBSE, NCERT and KVS examination guidelines. These case based questions are expected to come in your exams this year. Please practise these case study based Class 12 Business Studies Questions and answers to get more marks in examinations.

Case Study Questions Chapter 2 Principles of Management

Read the source given below and answer the following questions : Taylor suggested that method of production should not be decided by rule of thumb method but all the methods must be tried in the organisation and the one which brings maximum benefits with minimum cost must be selected. To determine the best way there are certain parameters right from procurement of raw materials till the final product is delivered. Taylor developed the concept of assembly line by using method study. The objective of method study is to minimise the cost of production and maximise the quality and customer satisfaction. Ford motors used this concept very successfully.

Questions :

Question. Taylor developed which concept by using method study? (a) Six sigma (b) Assembly line (c) Just in time manufacturing (d) None of the above

Question. As per above para which company used this concept successfully? (a) Nike (b) Adidas (c) Ford (d) Hyundai

Question. The objective of method study is (a) to differentiate between efficient worker and inefficient worker. (b) to maximise production. (c) to minimise cost, maximise production and maximise quality. (d) none of the above

Question. There is only one best method to do a thing is suggested in which scientific principle? (a) Science not rule of thumb (b) Harmony, not discord (c) Cooperation, not individualism (d) Development of workers to their greatest efficiency and prosperity

Read the source given below and answer the following questions. Ram is a class twelfth commerce student in a reputed school in Punjab. Mohan is his elder brother who is doing his Masters in Hospital administration from Delhi after completing his B.Sc course. During vacations when Mohan comes home, Ram shows him the businessstudies project that he is preparing on the topic ‘Principles of Management’. Mohan tells him that these principles are also a part of MBA course curriculum at the beginner’s level as they form the core of management in practice. But he finds these principles different from those of pure science.

Question. Management principles are taught in the MBA colleges also. This indicates which aspect of nature of management? (a) Management as Science (b) Management as Art (c) Management as Profession (d) Management as both science and art

Question. Management principles and scientific principles are : (a) Same (b) Different from each other (c) Both (a) and (b) (d) None of the above

Question. Management principles are derived or formed by (a) will and wish of Manager (b) overnight (c) deep observation and repeated experiments (d) none of the above

Question. Outline the feature of Principles of Management highlighted above. (a) Pervasive (b) Contingent (c) Behavioural (d) None of the above

Read the source given below and answer the following questions. Alpha Ltd. was engaged in business of garment manufacturing and selling its products under a popular brand. The demand for their product was increasing. In order to keep the market share in short run, the company directed its existing workforce to work overtime but this resulted in many problems. Due to increasing pressure of work the efficiency of workers declined. Sometimes workers worked under more than one superior. The departments which were producing one product were asked to produce more than one type of products. This resulted in lot of overlapping and wastage. The workers were becoming indisciplined. The spirit of team was also reducing. Workers were feeling cheated and their morale was declining. The quality of garments started declining and market share decreased.

Question. “Workers were feeling cheated and their morale was declining”. This is related to which principle? (a) Principle of Division of Work (b) Principle of Equity (c) Principle of Unity of Command (d) Principle of Initiative

Question. “Departments which were producing one product were asked to produce more than one type of products”. This is violation of which principle? (a) Principle of Discipline (b) Principle of Unity of Direction (c) Principle of Division of Work (d) None of the above

Question. “The spirit of team was also reducing”. This indicates violation of which principle ? (a) Principle of “Espirit De Corps” (b) Principle of Unity of Command (c) Principle of Unity of Direction (d) Principle of Discipline

Question. “Sometimes workers worked under more than one superior.” This is violation of which principle of management? (a) Principle of Discipline (b) Principle of Unity of Command (c) Principle of Unity of Direction (d) Principle of Equity

Read the source given below and answer the following questions : The principles of management are intended for all types of organisations, business as well as non-business, small as well as large, public as well as private sector, manufacturing as well as service sectors. They are not rigid prescriptions , which have to be followed absolutely. They can be modified by the manager as per the prevailing situation. Adherence to these principles adds to managers ’ knowledge, ability and understanding of managerial situations and circumstances. It enables managers to learn from past mistakes and conserve time by solving recurring problems quickly . These principles of management hold great relevance and managers should try to follow them as far as possible . Often certain principles of management are violated and the entire organization suffers. For example, Raman is working as a production manager in CFL Ltd. which manufactures CFL bulbs. His subordinate Arjun designed a plan for cost reduction but it was not welcomed by Raman. Another employee gave some suggestions for improvement in design but it was also not appreciated by Raman. This resulted in dissatisfaction among the employees which further resulted in poor performance of the employees. On the basis of the above paragraph answer the following questions:

Question. ‘It enables managers to learn from past mistakes and conserve time by solving recurring problems quickly’. According to this statement, the principles of management are important because they help in  ………………… (a) Meeting changing environment requirements (b) Optimum utilization of resources and effective administration (c) Providing managers with useful insights into reality (d) Fulfilling social responsibility

Question. As Raman did not welcome the suggestions of other employees, which principle of management is violated by him? (a) Discipline (b) Order (c) Unity of direction (d) Initiative

Question. Identify the nature of principle of management discussed in the given para. (Choose the correct alternative) (a) General guidelines (b) Universal applicability (c) Formed by practice and experimentation (d) Contingent

Question. Identify the nature of management principles when it is said that principles of management can be modified as per the prevailing situation. (Choose the correct) (a) Flexible (b) Contingent (c) Behaviour (d) Absolute

Read the source given below and answer the following questions : Principles of Taylor and Fayol are mutually complimentary. One believed that management should share the gains with the workers, while the other suggested that employees’ compensation should depend on the earning capacity of the company and should give them a reasonable standard of living. Taylor also developed certain techniques of scientific management which aimed at improving the performance of the employees. One of his techniques aimed at differentiating between efficient and inefficient workers. The purpose behind this technique is to reward efficient workers and motivate inefficient workers to perform better. 

Question. Which principle of scientific management advocates complete agreement between the managers and workers? (a) Harmony not discord (b) Cooperation not individualism (c) Science not rule of thumb (d) Development of each and every person to his/her greatest efficiency and prosperity.

Question. Which principle of Henri Fayol is being referred to in the above paragraph? (Choose the correct alternative) (a) Discipline (b) Order (c) Equality (d) Remuneration of employees

Question. ‘One of his techniques aimed at differentiating between efficient and inefficient workers’. Name the technique of scientific management reflected in the given statement. (Choose the correct alternative) (a) Functional foremanship (b) Method study (c) Differential piece wage system (d) Standardisation and simplification of work

Question. Which principle of scientific management is the extension of the principle ? (Choose the correct alternative) (a) Harmony not discord (b) Cooperation not individualism (c) Science not rule of thumb (d) Development of each and every person to his/her greatest efficiency and prosperity

Read the source given below and answer the following questions : The application of principles of management is dependent upon the prevailing situation at a particular point of time. The application of principles has to be changed as per the requirements .These principles are logical rather than blind faith. They are based on objective assessment of the situation. Management decision taken on the basis of principles are free from bias and prejudice. Managers often try to apply these principles in various day to day situations. violation of these principles can result in negative consequences in the organization. For example, Sushma and Suresh are working  in a Multinational company at the same level. Both are working hard and are happy with their employer. Suresh had the habit of backbiting and wrong reporting about his colleagues to impress his boss. All the employees knew about it. At the time of performance appraisal, the performance of Sushma was judged better than Suresh. Even then their boss Nikhil decided to promote Suresh stating that being a female Sushma will not be able to handle the complications of a higher post. This resulted in a great deal of dissatisfaction for Sushma. Nikhil gave priority to his own interest over the interest of the organization. Since he personally liked Suresh more than Sushma, hence he promoted Suresh instead of Sushma, ignoring the overall interest of the organization. On the basis of the above paragraph answer the following questions:

Question. “The application of principles of management is dependent upon the prevailing situation at particular point of time”. What is the nature of principles of management that is depicted by the above statement? (Choose the correct alternative)  (a) Universal applicability (b) Flexible (c) Contingent (d) Mainly behavioural

Question. ‘Decisions based on management principles are free from bias and prejudice’. This statement shows which importance of principles of management. (Choose the correct alternative) (a) Scientific decisions (b) Fulfilling social responsibility (c) Providing managers with useful insights into reality (d) Meeting changing environment requirements

Question. ‘Nikhil gave priority to his own interest over the interest of the organisation’. Which one of the following principles have been violated in the given case.  (a) Order (b) Equity (c) Discipline (d) Initiative

Question. Violation of which principle of management prompted Nikhil to further violate the managerial principle identified (a) Division of work. (b) Unity of direction (c) Subordination of individual interest to general interest (d) Centralization and decentralization

Read the source given below and answer the following questions : Sakaar Foundation is an NGO (Non-Government organization) working to improve thelives of children with medical needs, the homeless and victims of natural disasters. Apart from donations in Cash, they collect dry ration, old clothes, shoes, toys, books, medicines, etc. from donors. At Sakaar Foundation’s office in Lucknow the material collected is segregated, classified and put in shelves and boxes that are numbered systematically. There is a specific place for each of these items and volunteers put everything at their respective places. The volunteer work is divided into specific jobs like fund raising, field visits, social media updates and so on. Each volunteer is a part of a particular team, depending on their competency and training. Each volunteer becomes specialized in their respective field , leading to efficient utilization of human effort. The management of Sakaar Foundation does not close its ears to any constructive suggestion made by the volunteers. There is an equal division of work and responsibility between volunteers and management. All day long the management works side by side with the volunteers helping ,  encouraging and smoothing the way for them.

Question. _____________ is considered as the father of scientific management. (Fill up the blank with the correct alternative) (a) Peter Drucker (b) F.W.Taylor (c) Henri Fayol (d) Abraham Maslow

Question. Identify the principle of scientific management adopted by Sakaar Foundation in the above case. (Choose the correct alternative)  (a) Science not rule of thumb (b) Cooperation not individualism (c) Harmony not discord (d) Development of each and every person to his/her greatest efficiency and prosperity.

Question. Which principle of management means “a specific place for everything and everyone” as adopted by Sakaar Foundation? . (Choose the correct alternative) (a) Discipline (b) Order (c) Initiative (d) Scalar chain

Question. Identify the importance of principles of management that can be linked with the given case. (Choose the correct alternative) (a) Fulfilling social responsibility (b) Optimum utilization of resources and effective administration (c) Meeting changing environment requirements (d) Providing managers with useful insights into reality

Read the source given below and answer the following questions : Vishesh completed his MBA at a reputed business school in Lucknow. He was impressed by the principles and techniques of scientific management developed by F.W.Taylor. On completing his MBA, he wanted to apply Scientific Management in his family’s business of fast food chain of restaurants named ‘Burger Mania’. His main goal was to reduce costs with increased output. To begin with, he wanted to develop a standard method which would be followed throughout the organization. So, he investigated traditional methods through work study and unified the best practices. The standard method,i.e., the best way of doing the job was then developed taking into account all parameters right from the procurement of raw materials till the delivery of the final product to the customer. Vishesh also believed that each person should not only be scientifically selected but should also be given the required training to increase efficiency. For this, he set up a special training unit called ‘Hamburger’ in Bengaluru where the workers were given the required training to learn the best method. At the factory, the ingredients making up a burger were strategically placed to reduce the time taken for excess movements. The standard time and other parameters were determined on the basis of work study and Vishesh rewarded the workers for meeting the standard output . Now, ‘Burger Mania’ has standardized processes, raw material, time, machinery, trained staff and working conditions that ensure that the food they send out to their customers has the same high standards of excellence and level of quality in every chain or franchise. The application of Scientific Management to every aspect of restaurant operations led to ‘Burger Mania’s’ widespread success.

Question. Identify the principle of Scientific Management that helped Vishesh in investigating the traditional methods through work study and unifying the best practices. (Choose the correct alternative) (a) Science not rule of thumb (b) Method study (c) Harmony not discord (d) Cooperation not individualism

Question. ‘Vishesh also believed that each person should not only be scientifically selected but should also be given the required training to increase efficiency . ’ Identify the principle of Scientific Management mentioned in the given statement. (a) Cooperation not individualism (b) Stability of personnel (c) Harmony not discord (d) Development of each and every person to his/her greatest efficiency and prosperity.

Question. Identify the technique of Scientific Management used by Vishesh to reward the workers for meeting the standard output. (a) Time study (b) Motion study (c) Differential piece system (d) Functional foremanship

Question. ‘At the factory, the ingredients making up a burger were strategically placed to reduce the time taken for excess movements.’ Identify the technique of Scientific Management mentioned in the given statement. (a) Method study (b) Motion Study (c) Standardization and simplification of work (d) Time study

Read the source given below and answer the following questions : Amar is the Managing director in a garment manufacturing company. He is an experienced manager and firmly believes in application of principles of management in day to day managerial situations. He believes that management principles are flexible to adapt to dynamic business environment. He believes in producing more and better work for the same effort. He always hires specialists for various job positions. This results in efficient and effective output. Hence the organization has separate departments for finance, marketing, production and human resource. Being a management expert, Amar believes in the concept of having one and only one boss for every individual employee. He always aims at avoiding dual subordination within the organization. Under his direction and supervision, his company has achieved new heights within a short span of time. As the Managing director, he formulates policies that aims at minimizing employee turnover and maintaining organizational efficiency. Hence his organization selects personnel after due and rigorous procedure, and once a person is selected, he is kept at his post for a minimum fixed tenure. This helps in improving the overall efficiency of the organization.

Question. Identify which importance of principles of management is mentioned here? (a) Providing managers with useful insights into reality (b) Meeting changing environment requirements (c) Fulfilling social responsibility (d) Scientific decisions

Question. ‘He always aims at avoiding dual subordination within the organization’. Name the principle of management that aims at avoiding dual subordination. (a) Order (b) Equity (c) Unity of direction (d) Unity of command

Question. Identify the principle of management that suggests setting up of separate departments for finance, marketing, production etc. within an organization. (a) Discipline (b) Centralization and Decentralisation (c) Division of work (d) Authority and responsibility

Question. “As a Managing Director, he formulates policies that aim at minimizing employee turnover and maintaining organizational efficiency”. Which principle of management Amar is following? (a) Order (b) discipline (c) Equity (d) Stability of personnel

Read the source given below and answer the following questions : After completing her Bachelors in Fashion Designing from a well-known college in France, Aditi has opened a boutique in a posh market in Kolkata. She has divided the work in smaller units and each employee is well trained to perform his /her task efficiently. The sales persons are allowed to close a deal with a buyer by giving a maximum of 5 percent discount , whereas the decision to give any further discount rests with Aditi as the final authority. In the earlier period of her business venture, employees were asked to put in extra hours of work. In return she had promised to give them a special incentive with in a year. Therefore, when the business was doing well, she honoured her commitment by giving bonus to her employees. She also instructed her employees that communication from top to bottom should follow the official lines of command. However, she tends to be more biased towards her female employees, when it comes to solving the conflicts among employees. 

Question. “Therefore, when the business was doing well, she honoured her commitment by giving bonus to her employees.” Which principle of management is being highlighted here? (a) Discipline (b) Order (c) Remuneration to Employees (d) Unity of Direction

Question. Aditi tends to be more biased towards her female employees, when it comes to solving the conflicts among employees. Which principle is being violated here? (a) Discipline (b) Order (c) Equity (d) None of these

Question. Aditi has divided the work in smaller units and each employee is well trained to perform his/ her task efficiently. Which principle of management is being followed here? (a) Centralization and Decentralization (b) Division of work (c) Discipline (d) Order

Question. “The sales persons are allowed to close a deal with a buyer by giving a maximum of 5 percent discount, whereas the decision to give any further discount rests with Aditi as the final authority”. Identify the principle of Management being followed here: (a) Centralization and Decentralisation (b) Authority and Responsibility (c) Unity of Command (d) Unity of Direction

Read the source given below and answer the following questions : Ramesh is day and night involved in the organizing of his business. He has given job to every employee based upon his capability and experience. As there has been proper division of work and systematic allocation of tasks the productivity is increasing. The size of the company has increased in the recent past. The related activities which are similar in nature are grouped together. Everything was going well in the organisation until recently. The company has recently seen a deficit of exchange of information across functionally different departments. 

Question. Now the related activities which are similar in nature are grouped together. Which step of organising is highlighted in the above case: (a) Identification and division of work (b) Departmentalisation (c) Assignment of duties (d) Establishing authority relationship

Question. The company has recently seen a deficit of exchange of information across functionally different departments. Which one disadvantage of functional structure is highlighted above: (a) Function allocative (b) Conflict of interests (c) Inflexibility (d) Problems in coordination

Question. Which importance of organizing is highlighted in be above case: (a) Optimum utilisation of resources (b) Effective administration (c) Benefits of specialisation (d) Expansion and growth

Question. Identify the type of organisational structure which facilitates occupational specialisation. (a) Functional structure (b) Horizontal structure (c) Network structure (d) Divisional structure

Read the source given below and answer the following questions : Ganesh Leathers is a shoe manufacturing company. The firm has decided to increase the productivity of its workers. For this the firm has chalked out a plan. It will be hiring operational managers to work at the lower levels of management. It has decided to keep eight managers over a group of workers. Thus every worker has to report to all these eight managers. The managing director of the company Mr. Ganesh Tiwari is of the view that the principles of management are guidelines to action but do not provide readymade straitjacket solutions to all managerial problems. This is so because real business situations are very complex and dynamic and are a result of many factors. According to him it is necessary to differentiate between efficient and inefficient workers. Hence, he introduced specific rate of wage payment for those who performed above standard and for those who performed below standard. The basic idea behind is to improve the productivity of all the workers.

Questions : Question. Which technique of scientific management is employed by Ganesh leathers by keeping eight managers. (a) Time study (b) Motion study (c) Functional foremanship (d) Standardisation of work

Question. Which principle of Henri Fayol is followed by the company in the above case. (a) Unity of direction (b) Unity of command (c) Initiative (d) Discipline

Question. Which nature of principles of management is mentioned in the given para. (a) Universal applicability (b) Flexibility (c) General guidelines (d) Contingent

Question. Which technique of scientific management is used by the firm to differentiate between efficient and inefficient workers. (a) Time study (b) Motion study (c) Differential piece rate system (d) method study

Read the source given below and answer the following questions : Care Ltd. is a well known cement company in India. It is able to earn adequate revenues to cover costs. Its capital base, number of employees and production turnover has increased manifolds over the years. The rate of profitability of the business is also creditable. The employees of the company are happy and satisfied. The overall pay and compensation paid by the company is fair to both- employees and the organisation. There is complete cooperation between the workers and management. The spirit of competition has been replaced by the spirit of cooperation within the organisation. As a part of its moral obligation, the company has taken many initiatives for providing employment to specially abled persons and promoting literacy in the rural areas. 

Questions : Question. ‘It is able to earn adequate revenue to cover costs’.the company in the given statement. (a) Growth (b) Survival (c) Profit (d) Diversification

Question. Which importance of management is discussed in the given case. (a) Management increases efficiency (b) Management helps in the development of society (c) Management creates a dynamic organisation (d) Management is an intangible force

Question. Name the principle of Fayol followed by the company in the given case. (a) Discipline (b) Order (c) Remuneration of employees (d) Unity of direction

Question. Which principle of scientific management is followed by the company in the given case: (a) Scientific not rule of thumb (b) Harmony not discord (c) Cooperation not individualism (d) Development of each and every person to his or her greatest efficiency and prosperity.

Read the source given below and answer the following questions : Rajat Joined as a CEO of Bharat Ltd. a firm manufacturing computer hardware. On the first day he addressed the employees. He said that he believed that a good company should have an employee suggestion system and he wished to minimize employee turnover to maintain organisational efficiency. He informed all employees that he would ensure that all agreements were clear, fair and there was judicious application of penalties. However, he said that he believed that lazy personnel should be dealt with sternly to send the message that everyone was equal in the eyes of management . Also that he would want to promote a team spirit of unity and harmony among employees, which would give rise to a spirit of mutual trust and belongingness among team members and eventually minimize need for using penalties. He told all present that the interests of the organization should take priority over the interests of any one individual employee.

Questions : Question. Identify the principal of management in the following line. “ He said that he believed that a good company should have an employee suggestion system” (a) Unity of command (b) Unity of direction (c) discipline (d) initiative 

Question. Identify the principal of management in the following lines “Which would give rise to a spirit of mutual trust and belongingness among team members. (a) Discipline (b) Unity of command (c) Initiative (d) Esprit de corps. 

Question. Identify the principal of management in following line. “He wished to minimize employee turnover to maintain organizational efficiency.” (a) Stability of personnel (b) Discipline (c) Centralization and Decentralization (d) Remuneration of employees 

Question. Identify the principal of management in the following lines. “He informed all employees that he would ensure that all agreements were clear, fair and there was judicious application of penalties.” (a) Initiative (b) Equity (c) Discipline (d) Esprit de corps.

Read the source given below and answer the following questions : Radhika opens a jewellery showroom in Jaipur after completing a course in jewellery designing. She has employed eleven persons in her showroom. For greater productivity, she divides the work into small tasks and each employee is trained to perform his/ her specialised job. The sales persons are allowed to close a deal with a buyer by giving a maximum of 10% discount, whereas the decision to give any further discounts rests with Radhika as the final authority. In the earlier days of starting of the business, five of her employees were asked the put in extra hours of work. In return she had promised to give them a special incentive within a year. Therefore, after six months when the business was doing well, she awarded a cash bonus to each of these employees to honour her commitment. However, when it comes to settling the conflicts among her employees, she tends to be more biased towards her female employees.

Question. Identify the principal of management in the following lines. “Therefore after six months when the business was doing well, she awarded a cash bonus to each of these employees to honour her commitment. (a) Discipline (b) Initiative (c) Scalar chain (d) Remuneration 

Question. Which principle is violated in the following lines. “However when it comes to setting the conflicts among her employees, She tends to be more biased towards her female employees.” (a) Discipline (b) Equity (c) Division of work (d) Justice 

Question. Identify the principal of management in “She divided the work into small tasks and each employee is trained to perform his/her specialised job” (a) Unity of command (b) Unity of direction (c) Division of work (d) Discipline 

Question. Identify the principal “The sales persons are allowed to close a deal with a buyer by giving a maximum of 10% discount, whereas the decision to give any further discount rests with Radhika as the final authority” (a) Division of work (b) Discipline (c) Initiative (d) Centralisation and decentralisation 

Read the source given below and answer the following questions : As students of a management course Karan and Kunal were asked to prepare a project report on applicability of principles of management in real business situations. In order to conduct the survey Kunal had selected an outlet of a popular chain of fast food restaurant whereas Karan visited a nearby department store. When Kunal presented his report to class, Karan realised that their observations were matching on various grounds. In both the business units, work is divided into small tasks and each is performed by a trained employee. A set of rules are predetermined and communicated to employees for compliance and these is a fixed place for every thing and all employees have been allotted individual space. Moreover, the manager encourage a spirit of mutual trust and belongingness among the employees so that need for imposing penalties is reduced.

Question. Identify the principles of management in the following lines: “There is a fixed place for everything and all employees have been allotted individual space” (a) Unity of direction (b) Order (d) Scalar chain (d) Equity 

Question. Identify the principal of management in the following lines “work is divided into small tasks and each is performed by a trained employee.” (a) Unity of direction (b) Unity of command (c) Division of work (d) Initiativ

Question. Identify the principal of management in following lines “A set of rules are predetermined and communicated to the employees for compliance.” (a) Discipline (b) Scalar chain (c) Unity of command (d) Unity of direction 

Question. Identify the principle of management in the following lines: “Managers encourage a spirit of mutual trust and belongingness among the employees” (a) Unity of command (b) order (c) Equity (d) Esprit de corps 

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