CBSE Class 12 Business Studies Organising Worksheet Set A

Question. ‘If we delegate authority, we multiply it by two; if we decentralize it, we multiply it by many.’ Name the two concepts to which this statement is related.
Answer : a) Delegation of authority
b) Decentralization

Question. Miss Tyagi is working as the Production manager in a company. She divided the work among her subordinates in her accordance with their interest and ability. Not only this, she even gave them all the authorities to take decisions relating to their work. At the end of the first month of the year, it was found that Mr. Rajeev had not achieved his target. He was lagging far behind his target. Miss Tyagi asked him to give the reason within two days why his performance was slow.
With which concept of management the conversation between Miss Tyagi and Mr. Rajeev referred to in the above paragraph is related. Identify it.
Answer : Accountability

Question. Give two advantages of functional organization.
Answer : a) Benefits of specialization
b) Coordination is established

Question. Informal organization is not deliberately created. Then how it is created?
Answer : It emerges out of mutual relations and tastes.

Question. What is an organization chart?
Answer : Organization chart is a drawing which shows the relationship among the various posts established in the organization.

Question. Overburdened and with the approval of the CEO disperses some of his authority to various levels throughout the organization.
Identify the concept of management discussed above.
Answer : Decentralization

Question. How ‘effective management’ is possible through delegation of authority?
Answer : Because it reduces the work load of a manager.

Question. Define ‘organizing’ as a function of management.
Answer : It refers to the process of defining and grouping the activities of an enterprise and establishing authority relationship among them.

Question. State the essence of authority.
Answer : Its essence is to get decisions implemented.

Question. In order to successfully realize the objectives of an organization, first of all it is ensured that which activities will have to be performed. In the list of activities, all the activities, big or small, are included. But it is not possible to set up separate departments for all activities. Some similar activities are put together in same department. In the same way some necessary departments are set up. The reason for doing this is to exercise control over unnecessary administrative expenses.
Identify the concept of management under which similar activities are put together and departments are set.
Answer : Departmentalization

Question. There are 75 persons working in the Production Department of ‘Ganesh Pvt. Ltd.’ The manager of this department, Mr.Neeraj ,is very punctual. He does not at all tolerate reaching the office late and leaving it early. But so far as the mutual relations of the employees are concerned, he is very liberal. All the employees of the department have been instructed that they can communicate any time irrespective of the high or low position of the employees concerned. The first specialty of Mr.Neeraj creates discipline and on makes the atmosphere pleasant.
Identify the concept of management concerning the employees described in the above paragraph.
Answer : Informal organization

Short Answer Questions :

Question. ‘Daivki hospital’ is a famous company which provides health services. It has a great market share. Last year, in no time, several MNCs arrived. This fact caused a great fall in the companies business. The whole responsibility of finding the solution of this problem fell on the shoulders of General Manager. Now in order, to keep himself away from the routine activities of the company, he gave some of his authorities to his departmental managers. He gave them this freedom also that if they wanted, they could give some of these authorities to their own subordinates. The departmental managers were already feeling themselves overburdened with the workload. Therefore, they handed over some of their authorities to their subordinates. As a consequence of this, on the one hand, General Manager got time to solve the serious problems and, on the other hand, the feeling of responsibility was aroused in the subordinates. Within a few days the growth rate of the company started rising.
Identify the concept of management described in the paragraph given above and also explain the two points of its importance spoken about here.
Answer : Here decentralization is described. Its importance becomes evident from the following points:
a) It reduces the workload of Top Management.
b) It provides freedom to the subordinates in taking decisions

Question. Decentralization is extending delegation to the lowest level. Comment.
Answer : Decentralization is an expansion of delegation of authority. Eg- if a chief manager of a company assigns a job to the production manager for appointing employees needed for his division on salary then this will be turned as delegation of authority. On the contrary, if this authority for appointing employees is delegated to every departmental head then it will be termed as decentralization.

Question. State any three characteristics of decentralization.
Answer : a) It is an expanded version of delegation of authority.
b) It increases the significance of the role of subordinates.
c) It reduces the workload of senior officers.

Question. Distinguish between Delegation of Authority and Decentralisation
Answer :
 

Question. ‘Organization is a machine of management’. Comment.
Answer : Organization is considered to be a machine of management. It is that machine in which no part can afford to be ill-fitting or non functional. In other words if the division of work is not done properly or posts are not created correctly the whole system of management collapses.

Question. State any three advantages of informal organization.
Answer : a) Effective communication: In the absence of any definite course, it is an effective system of communication. Messages can be quickly conveyed from one place to another with the help of this system
b) Fulfils social needs: People having similarity of thoughts and ideas form a group of their own. All the people in the group stand by one another in all the organizational or personal matters.
c) Fulfils organizational objectives in informal organization, there is no pressure of formal organisation. In the informal organisation, the subordinates put their ideas before the superiors without any fear or hesitation. It helps the superiors to understand their difficulties and immediate solution of the problem is sought out.

Question. What is meant by Delegation? State any four points which highlight the importance of delegation in an organization.
Answer : Delegation of authority is the process of entrusting responsibility and authority, and creating accountability of the person to whom workor responsibility is handed over. It’s importance are:
a) Effective management: Delegation of authority reduces the work load of a manager. Mangers who practice delegation of authority are definitely better decision makers than those who do not delegate authority.
b) Motivation of employees : In the process of delegation of authority, both authority and responsibility are delegate to their subordinates. This situation provides liberty to work and take decisions on the part of subordinates. Through this; they exhibit their talent and skill.
c) Facilitation of work: Delegation of authority does not develop only one person or division but facilitates the development of the organisation as a whole. As adequate number of able employees are available in an organization to take decisions expansion modernisation and diversification of a business can be done with full confidence.

Question. ‘Formal organization Is impersonal while Informal organization is personal.’Clarify.
Answer : In formal organization personal feelings are ignored and strict discipline is observed. It is not the person but the work that happens to be important. In informal organization the feelings of individual are kept in mind and nothing is imposed upon them.

Question. Give the meaning of ‘divisional structure’ of organizing. State its four advantages.
Answer : Divisional structure means division of the whole enterprise according to the major products to be manufactured by it. Its advantages are:
a) Development of divisional heads: The head of each division looks after all the functions connected with their product. Hence, it helps in the development of varied skills in a divisional head.
b) Quick decision making: Every division is independent in itself. The divisional manager can take any decision regarding his division independently without consulting others.
c) Easy expansion: For every product, a separate division is opened. If a company wants to introduce a new product, it can be introduced easily without disturbing existing division.

Long Answer Questions :

Question. ‘Safe service limited’ is a well known company for removing the routine problems of the people. This company provides all types of big or small services; namely, Health services, Complaints regarding electricity faults, etc. This company has opened its offices at different places. The policy of the company is that women should be preferred to be appointed as the Heads of every office. Besides, under this policy, some positions shall be reserved for handicapped women also. The head of every office shall have the full authority to take decisions concerning the activities of her office.
a) Which concept of management has been mentioned in the paragraph given above?
b) Write about two of the advantages of the concept identified in point ‘a’.
c) Identify two of the values of the company.
Answer : a) Decentralization
b) i) This reduces the workload of the top management.
ii) Decisions can be taken very soon when the authority is given to all the concerned managers.
c) i) Women Empowerment
ii) Feelings of equality

Question. Distinguish between Formal and InformalOrganization
Answer :

Question. Explain the concept of ‘Functional Structure’. Also, explain three disadvantages of functional structure.
Answer : Functional structure refers to the division of the whole enterprise according to the major functions to be performed by it. This is the simplest and the most prevalent form of organizational structure. Under this all the functions of similar nature are divided in different units which are called departments. Its disadvantages are: 
a) Ignorance of organizational objectives: Each departmental head will work according to his sweet will. They always give more importance to their department objectives. Hence organisational objectives suffer.
b) Difficulty in inter departmental coordination: All departmental heads may work as per their own wish. No doubt this facilitates coordination within the department but it makes inter departmental coordination difficult
c) Conflict of interest: Every departmental head wants to become a functional empire. To satisfy their ego, every one demands maximum resources in their department. This situation leads to conflicts among different departmental heads.
d) Hurdle in complete development: This system is a hurdle in the way of the complete development of the employees. Each employee specialises only in a small part of the whole job.

Question. Aradhana and Gandharv are heads of two different departments in Yumko Ltd. they are efficient managers and are able to motivate the employees of their respective departments to improve performance. However, their drive to excel in their own sphere of activity instead of giving emphasis on objectives of the enterprise has hindered the interaction between the departments that Aradhana and Gandharv are heading. Often there are inter-departmental conflicts and they have become incompatible. This has proved to be harmful in the ulfillment of the organizational objectives. The situation has deteriorated to such an extent that the CEO of Yumko Ltd. has hired a consultant Rashmi, to resolve the problem. After studying the situation closely, Rashmi found that the problem has arisen due to inflexibility and a narrow perspective on the part of both Aradhana and Gandharv. She is of the view that this situation is a result of the type of organizational structure Yumko Ltd. Has adopted.
Identify the organizational structure adopted by Yumko Ltd. And state any three advantages of the structure so identified. 
Answer : Functional Structure is the organizational structure adopted by Yumko Ltd.
Advantages in detail
1. Benefits of specialization
2. Coordination is Established
3. Managerial Efficiency is increased

Question. ‘Decentralization is an important philosophy that implies selective dispersal of authority’.
In the light of this statement, explain any four points of importance of ‘Decentralization.
Answer : Importance of Decentralization are:
(1) Develops initiative among subordinates: When lower managerial levels are given freedom to take their own decisions they learn to depend on their own judgment and develop solutions for the various problems they encounter. So, decentralization policy helps to identify those executives who have the necessary potential to become dynamic leaders
(2) Develops managerial talent for the future: Decentralisation gives the subordinates with skills a chance to prove their abilities and creates reservoir of qualified manpower that can be considered to fill up more challenging positions through promotions.
(3) Quick decision making: In a decentralized organization, decisions are taken at levels which are nearest to the points of action and there is no requirement for approval from many levels. So, more accurate and faster decisions can be taken as the subordinates are well aware of the realities of situations
(4) Relief to top management: Decentralisation leaves the top management with more time which they can devote to important policy decisions as they decentralize authority for routine operational problems. Further decentralisation diminishes the amount of direct supervision exercised by a superior over the activities of a subordinate because they are given the freedom to act.

Question. 150 employees are working in a handloom company. There is the pre defined arrangement of responsibility, authority and accountability in the company. As a result, the employees have hardly any doubt about their roles in the company. But the employees of the Marketing Department of the company are always very unhappy with a problem. The problem is that several times they get orders from two officers simultaneously. The two officers giving orders are the Marketing manager and the General Manager. In such a situation, they are not able to understand to whose orders they should give priority – one is their immediate boss and the other, a top officer of the company. Several departments have been set up in this company; namely, Purchase, Sale, Advertisement, Production, Stock, Research, Correspondence, Accounts, Finance and Personnel. In this way, there are ten departments in all. In every department all the modern facilities are available. The company’s Finance Manager says that the Administrative Expenses of the company are rather too much. According to him, the main reason for this is the existence of so many departments in the company.
a) Identify the concepts of Management described in the paragraphs above.
b) Which principle of Management is being violated in the company? Explain.
c) How can the increasing Administrative Expenses of the company be checked? Identify this concept.
d) The answer given in point ‘c’ is related to which function of Management?
Answer : a) Organizing and Principles of Management.
b) Here the Unity of command is being violated
c) The check on the Administrative Expenses can be exercised by reducing the number of departments. This concept is known as ‘Departmentalization’.
d) It is related to the Organizing Function of Management.

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