CBSE Class 12 Business Studies Principles Of Management Notes Set A

CBSE Class XII Business Studies - Principles of Management Notes. Learning the important concepts is very important for every student to get better marks in examinations. The concepts should be clear which will help in faster learning. The attached concepts made as per NCERT and CBSE pattern will help the student to understand the chapter and score better marks in the examinations.




Concept : Principles of management are general guidelines which can be used
under certain situations. Nature : (a) universal applicability (b) formed by practice (c) flexible (d) mainly behaviou
ral (e) cause and effect relationships (f) general guidelines contingent

Importance: (a) useful insights into reality (b) optimum utilisation of resources (c) scientific decisions (d) meeting changing environment (e) management training and research (f) fullfilling socia responsibility

Principles of Scientific Management : (a) science not rule of thumb (b) harmony not discord (c) cooperation not individualism (d) maximum not restricted output (e) developerat
pment of each son to gretes efficiency.

Techniques of Scientific Management: (a) functional foremanship (b) differential piece rate system (c) work study time study, motion study, fatigue study, method study (d) standardisation and simplification of work.

Fayol's Principles : (a) division of work (b) authority and responsibility (c) discipline (d) unity of command (e) unity of direction (f) subordination of individual interest to common interest (g) remuneration (h) centralisation and decentralisation (i) scalar chain (j) order (k) equity (I) stability of tenure (m) initiative (n) esprit de corps

Taylor vs. Fayol : Their contributions are complementary in nature despite several differences.



The principles are broad statement of fundamental truth which provide guide lines for management decision and action. These guidelines are derived through experimentation and observation 


1. Universal application can be applied to all kind of organisations, irrespective of their size and nature.

2. General guidelines the formulated guidelines to action which need to be adjusted and used as per the demands of the situation.

3. Formed by practice and experimentation derived through experimentation and Observation.

4. Flexible principles are not rigid like science but are modified according to the business environment needs.

5. Behavioural the principles aim to influence the unpredictable, complex and dynamic human behaviour.

6. Cause and effect relation they aid in predicting the outcome of management actions.

7. Contingent the management principles are dependent upon the prevailing Conditions/situations at that particular time hence amended accrdingly.


i. Provides managers with useful insights into reality through improved knowledge, ability, understanding and.
improved guidance to the managers

ii. Optimum utilisation of resources and effective administration through coordinated use of phy
sical, financial and human resources.

iii. Scientific decision they lend to be more realistic, thoughtful, justifiable and free from personal bias.

iv. Meet the changing environmental requirements by providing effective and dynamic leadership in imp
lementing changes.

v. Fulfils social responsibility guides the manager in fulfilling the social responsibility.

vi. Management training, education and research the principles help in increasing knowledge which is used as the basis for management training and research.


1. Division of labour work could be divided into small specialised task and performed by a trained specialist

2. Authority and responsibility there must be a right balance between authority (right to give orders) and responsibility (obligation to perform the assigned task).  

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