CBSE Class 12 Business Studies Organising And Staffing Worksheet Set B

MCQs for NCERT Class 12 Business Studies Organising

Question. ‘More delegation of authority helps managerial development’ out of the following with which this statement is related to?
(a) Delegation
(b) Decentralisation
(c) Centralisation
(d) All the above

Answer : B

Question. How many standardised forms of organisation structure are there?
(a) Two
(b) Three
(c) Four
(d) No definite number

Answer : D

Question. Which of the following increases the importance of the subordinates?
(a) Centralisation
(b) Decentralisation
(c) Delegation
(d) Specialisation

Answer : B

Question. Which of the following are parts of formal organisation?
(a) Functional organisation
(b) Line organisation
(c) Line and staff organisatiion
(d) All of these

Answer : D

Question.Which of the following is not a part of organizing process
a. division of work
b.assigning of responsibility.
c.specialization.
d.establising reporting relationship 

Answer : C

Question. Which organisation resists changes?
(a) Formal
(b) Informal
(c) Both (a) and (b)
(d) None

Answer : B

Question. What do we call the division of organisation structure on the basis of products?
(a) Functional organisation
(b) Divisional organisation
(c) Both (a) and (b)
(d) None

Answer : B

MCQs for NCERT Class 12 Business Studies Staffing

Question. With what responsibility is staffing related to?
(a) Social
(b) Political
(c) Government
(d) Individual

Answer : A

Question. What is the relationship between human resource development and staffing?
(a) Human resource management is biggar than staffing
(b) Staffing is biggar than human resource management
(c) Both are equal
(d) There is no relationship between the two

Answer : A

Question. Which of the following is included in the human resource management?
(a) Recruitment
(b) Specialised services
(c) Handling grievances
(d) All the above

Answer : D

Question. When does the Personnel Manager act as the Line Manager?
(a) When he performs the function of staffing as a function of management
(b) When he completes the job of staffing as part of functional area of management
(c) In both the above situations
(d) He never acts as the Line Manager

Answer : A

Question. Which of the following is the element of staffing?
(a) Recruitment
(b) Selection
(c) Training
(d) All the above

Answer : D

Question. Filling up of blank application form during the selection process contains information about ________ .
(a) Qualifications
(b) Personal information
(c) Minimum Salary acceptable
(d) All the above

Answer : D

Question. The concept related to searching for prospective candidates:
(a)selection
(b)training
(c)recruitment
(d)short listing 

Answer :  C

Question. Chandram Ltd. is a textile manufacturing company. Mr. Rahul, the owner of the company has created different departments for purchase, production, marketing, finance, and human resource. There are forty employees working in the organisation. Planning is of paramount importance to the company as Mr. Rahul believes that effective planning leads to achievement of organisational objectives. So, in order to make employees focus on objectives, he issued instructions that during working hours only official matters will be discussed. He made certain rules and code of conduct for the employees to follow, according to which employees are not allowed to visit and talk to the employees of other departments except for official work. He emphasised on work performance which resulted in smooth functioning of the organisation. Identify the type of organisation.
(a) Formal
(b) Informal
(c) Both (a) and (b)
(d) None of these
Answer. A

Question. Karan Industries are company manufacturing office furniture. The company chose to diversify its operations to improve its growth potential and increase market share. As the project was important, many alternatives were generated for the purpose and were thoroughly discussed amongst the members of the organisation. After evaluating the various alternatives, Sukhvinder, the managing director of the company decided that they should add ‘home interiors and furnishings’ as a new line of business activity. Choose the framework, which the diversified organisation should adopt, to enable it to cope with the emerging complexity?
(a) Functional
(b) Divisional
(c) Both (a) and (b)
(d) None of these
Answer. B

Question. Ravi opens a retail mart in a local market. As he knows it will be impossible for him to handle all work alone, he appoints Manak to perform tasks on his behalf thereby reducing his workload. This decision provided Ravi with more time to concentrate on important matters.
(a) Delegation
(b) Decentralization
(c) Both (a) and (b)
(d) None of these
Answer. A

Question. Gedart Ltd. is working by clubbing similar related jobs under different departments. The HR department is not in touch with the marketing department and this has created problems. The HR head feels that only he knows about the HR department and similar is the case with the marketing department. However, the truth is both of them have limited and specific skills. Which type of organisation structure does Gedart Ltd. have?
(a) Directing
(b) Divisional structure
(c) Informal structure
(d) Functional structure
Answer. D

Question. Waseem has joined as a Creative Head in an entertainment company. He always ensures that the work has been divided into small and manageable activities and also the activities of similar nature are grouped together. Identify the related step in organising process being mentioned in the above lines.
(a) Identification and division of work
(b) Departmentalisation
(c) Assignment of duties
(d) Establishing reporting relationships
Answer. B

Question. Sharda Ltd. is pursuing diversified activities which require a high degree of specialisation. Identify the type of structure that should be followed by Sharda Ltd.
(a) Functional structure
(b) Divisional structure
(c) Decentralised structure
(d) Informal structure
Answer. A

Question. Mr. Kiaan who is a boss of Aiysha Ltd. delegated some of his work to his subordinate and instructed him, “You are incharge of this project. I am here if you need me”. Which element of delegation is highlighted in the above case?
(a) Accountability
(b) Coordination
(c) Authority
(d) Creativity
Answer. A

Question. Himalaya Ltd. is engaged in manufacturing washing machines. The target of the organisation is to manufacture 500 washing machines a day. There is an occupational specialisation in the organisation which promotes efficiency of employees. There is no duplication of efforts in such type of organisation structure. Identify the type of organisation structure described above.
(a) Functional structure
(b) Divisional structure
(c) Decentralisation
(d) Delegation
Answer. A

Read the following text and answer question.

After completing a course in travel and tourism, Amit started his own travel agency. For smooth functioning of his business, he decided to create fourteen job positions. Further, he divided them into four departments on the basis of functions namely, front office department including online queries, reservations, department for airways, railways and roadways, accommodation booking department, and securing payments department. In order to avoid any interdepartmental conflicts, he decides to specify clearly the lines of authority and areas of responsibility for each job position.

Question. Identify the function of management performed by Amit:
(a) Planning
(b) Organizing
(c) Both (a) and (b)
(d) None of these
Answer. B

Question. Identify the framework created by Amit within which all managerial and operating tasks are to be performed in his organization.
(a) Organizational structure
(b) Functional structure
(c) Both (a) and (b)
(d) None of these
Answer. A

Question. Which type of organizational structure is used by Amit in his company?
(a) Functional structure
(b) Divisional structure
(c) Both (a) and (b)
(d) None of these
Answer. A

Question. Authority and responsibility are related to which concept of management:
(a) Delegation of Authority
(b) Coordination
(c) Both (a) and (b)
(d) None of these
Answer. A

Question. Aman runs a clothing company. There is lot of chaos in the organisation. He decided to do grouping of similar activities into departments, units, sections etc. using several criteria as a basis to facilitate specialisation.
The step of organizing process referred here is_______
(a) Identification and division of work
(b) Departmentalisation
(c) Assignment of duties
(d) Establishing reporting relationship
Answer. B

Question. Amit runs a real estate company. Now he wants to open a retail company. The size of organisation is large and there is a need for higher degree of specialisation.
The organisational structure discussed here is_______
(a) Divisional structure
(b) Functional structure
(c) Both (a) and (b)
(d) None of the above
Answer. B

Question. Bajaj limited is a manufacturing company that manufactures plastic buckets. Company has a target of manufacturing 100 buckets a day. In order to achieve this target efforts of all departments are coordinated and interlined, and authority-responsibility relationship is established among various job positions. There is clarity also that who will report to whom. The function of management discussed above, is_______
(a) planning
(b) organising
(c) staffing
(d) directing
Answer. B

Question. Infratech industry manufactures office furniture. To improve its growth potential and increase market share the company choose to diversify its operations to improve its growth potential and increase market share. Many alternatives were generated for the purpose and were thoroughly discussed amongst the members of the organisation, as the project was important. After evaluating the various alternatives Ali, the managing director of the company decided that they should add ‘home interiors and furnishings’ as a new line of business activity.______is the framework, which the diversified organisation should adopt, to enable it to cope with the emerging complexity?
(a) functional
(b) divisional
(c) both (a) and (b)
(d) none of the above
Answer. B

Question. ___________ is the process of dividing work into manageable activities and then grouping the activities which are similar in nature.
(a) Coordination
(b) Departmentalisation
(c) Organisation Structure
(d) Delegation of authority
Answer. B

Question. _______is the process by which the manager brings order out of chaos, removes conflict among people over work or responsibility sharing and creates an environment suitable for teamwork.
(a) Planning
(b) Organising
(c) Staffing
(d) Controlling
Answer. B

Question. _____________ is a right of a superior to command his subordinate and ensure obedience from him. Identify the element of delegation.
(a) Authority
(b) Accountability
(c) Responsibility
(d) None of these
Answer. A

Question. __________ obligation of a sub-ordinate to complete an assigned task given by his superior. Identify the element of delegation.
(a) Authority
(b) Accountability
(c) Responsibility
(d) None of these
Answer. C

Question. __________answerability of the subordinate about the final result of the assigned task. Identify the element of delegation.
(a) Authority
(b) Accountability
(c) Responsibility
(d) None of these
Answer. B

Question. __________refers to systematic dispersal of authority to the lowest level, except that which can be exercised at central points. Identify the concept of organizing.
(a) Delegation
(b) Decentralization
(c) Authority
(d) Responsibility
Answer. B

Question. __________means concentration of decision-making authority at higher or top levels of management. It refers to a situation where all decisions on all matters are taken by one or a few managers at relatively higher levels. Identify the concept of organizing.
(a) Delegation
(b) Centralization
(c) Authority
(d) Responsibility
Answer. B

Question. Match Column-I (Steps in the process of organising) with Column- II (Objectives) then select the correct answers from the option given below :

     (A) (B) (C) (D)
(a) (ii) (i) (iii) (iv)
(b) (iii) (i) (iv) (ii)
(c) (ii) (iii) (iv) (i)
(d) (iv) (iii) (ii) (i)
Answer. C

Question. Match Column-I (Points of crucial role in business enterprise) with Column- II (Objectives) , then select the correct answers from the option given below :

    (A) (B) (C) (D)
(a) (ii) (i) (iii) (iv)
(b) (i) (iii) (iv) (ii)
(c) (i) (ii) (iii) (iv)
(d) (iv) (iii) (ii) (i)
Answer. B

Question. Match Column-I ( Basis of Functional Structure in Business) with Column- II (Objectives of Functional Structure) , then select the correct answers from the option given below :

     (A) (B) (C) (D)
(a) (iii) (i) (ii) (iv)
(b) (i) (iii) (iv) (ii)
(c) (iv) (iii) (ii) (i)
(d) (i) (ii) (iii) (iv)
Answer. D

Question. Match Column A (Basis of Divisional Structure in Business) with Column- II (Objectives of Divisional Structure) then select the correct answers from the option given below :

    (A) (B) (C) (D)
(a) (ii) (i) (iv) (iii)
(b) (i) (iii) (iv) (ii)
(c) (iv) (iii) (ii) (i)
(d) (i) (ii) (iii) (iv)
Answer. A

Question. Match Column-I ((Basis of Formal Organisation in Business) with Column-II (Objectives of Formal Organisation) then select the correct answers from the option given below :

    (A) (B) (C) (D)
(a) (ii) (i) (iv) (iii)
(b) (i) (iii) (iv) (ii)
(c) (iv) (iii) (ii) (i)
(d) (i) (ii) (iii) (iv)
Answer. D

Question. Assertion: organizing promotes specialization.
Reason: Every organization is built on the principle of division of labour and specialization.
Answer. A

Question. Assertion: Organizing establish relation between top managements and subordinates.
Reason: It Establish working relationship between them by lines of communications with reporting parameters.
Answer. A

Question. Assertion: Organization structure are environment of within organization under which working is done
Reason: Organization structure should be fixed.
Answer. C

Question. Assertion: Functional structure provides effective control and coordination.
Reason: It may lead in conflict between two or more departments.
Answer. B

Question. Assertion: Divisional structures required where activities related no one product are grouped together.
Reason: So working related to each product are grouped under one department.
Answer. C

Question. Assertion: Formal organization improve initiative taking ability among workers.
Reason: It provides creative freedom to subordinates.
Answer. D

Question. Assertion: Informal organization has network oriented communication channel.
Reason: It provides faster communications and faster spread of information.
Answer. A

Question. Assertion: Sharing work with subordinates is called as delegation of authority.
Reason: Managers cannot manage and control each and every activity by self.
Answer. A

Question. Assertion: Delegation includes accountability.
Reason: Accountability is beyond the rules and regulations.
Answer. C

Question. Assertion: Organising helps in maximum use of humans resources in organisation.
Reason: Ability and commands provided by top managements is necessary for working
Answer. B

Question. What are the difference between Recruitment and selection?
Or
Recruitment is called as a positive process whereas selection is called as negative.” Why? Differentiate between these two. 
Ans:- I.Meaning:-Recruitment refers to the process of finding and instigating the required personnel for a job. Selection refers to the process of choosing the right candidate out of the gathered pool developed at the time of recruitment.
II.Sequence:-In the staffing process, recruitment is at the second stage.In the staffing process, selection is at the third stage and succeeds recruitment.
III.Employment Contract:-The candidates gathered under recruitment are not offered any employment contract from the organisation.The candidates who successfully complete the selection process are offered an employment contract by the organisation containing such information as date of joining, terms and conditions, etc.
IV.Characteristic:-Recruitment process involves attracting as many persons as possible for the job.Selection process involves choosing only the appropriate candidate and rejecting the non-suitable ones.

Question.What are the Methods of internal recruitment? Explain merits and limitations of internal recruitment.
Ans:- Following are important sources of internal recruitment:
I. Transfers: It involves the shifting of an employee from one job to another, from one department to another or from one shift to another shift.
II. Promotions: It refers to shifting an employee to a higher position carrying higher responsibilities, prestige, facilities and pay.
III. Lay-Off: To recall the temporary worker for work is called Lay-Off, who were temporarily separated from organization due to lack of work.
Advantages of Internal Sources Recruitment:
(a) Employees are motivated to improve their performance.
(b) Internal recruitment also simplifies the process of selection & placement.
(c) No wastage of time on the employee training and development.
(d) Filling of jobs internally is cheaper.
Limitation of Internal Sources
(a) The scope for induction of fresh talent is reduced.
(b) The employee may become lethargic.
(c) The spirit of competition among the employees may be hampered.
(d) Frequent transfers of employees may often reduce the productivity of the organization.

Question.What do you mean by on the job training Method? Explain the techniques of On the job training.
Ans:-
On the Job Method: It refers to the methods that are applied at the work place, where the employee is actually working. It means learning while doing.The following are the methods of On-the job training:
I. Apprenticeship Training: Under this, the trainee is placed under supervision of an experienced person (master worker) who imparts him necessary skills and regulates his performance. The trainee is given stipend while learning so that he/she can enjoy “earn while you learn” scheme.
II. Internship Training: Under this method an educational institute enters into agreement with industrial enterprises for providing practical knowledge to its students by sending them to business organizations for gaining practical experience.
III. Induction training is a type of training given to help a new employee in settling down quickly into the job by becoming familiar with the people, the surroundings, the job and the business. The duration of such type of training may be from a few hours to a few days. The induction provides a good opportunity to socialize and brief the newcomer with the company’s overall strategy, performance standards etc. If carefully done, it saves time and cost (in terms of effectiveness or efficiency etc.)

Question. What are the needs/ Importance of staffing? Explain.
Or
Staffing is an important function of management in all organizations. ”Why? Explain any four reasons.
Ans:-
I. Obtaining Competent Personnel: Proper staffing helps in discovering and obtaining competent personnel for various jobs.
II. High Performance: Proper staffing ensures higher performance by putting right person on the right job.
III. Continuous growth: Proper staffing ensures continuous survival and growth of the enterprise.
IV. Optimum utilization of human resources: It prevents under-utilization of personnel and high labor cost.
IV. Improves job satisfaction: It improves job satisfaction and morale of employee.

Question. Explain the process of staffing.
Ans:-
I. Estimating Manpower Requirement: It involves in Making inventory of current human resources in terms of qualification, training &skills,Assessing future human resource needs and Developing a programme to provide the human resources. Job Analysis is an intensive way of finding details related to all jobs.
II.Recruitment: It refers to identification of the sources of manpower availability and making efforts to secure applicants for the various job positions in an organization.
II. Selection: It is the process of choosing and appointing the right candidates for various jobs in an organization through various exams, tests &interviews.
IV. Placement and Orientation: When a new employee reports for duty, he is to be placed on the job for which he is best suited. Orientation/Induction is concerned with the process of introducing a new employee to the organization. The new employees are familiarized with their units, supervisors and fellow employees. They are also to be informed about working hours, procedure for availing leave, medical facilities, history and geography of organization and rules/regulations relating to their wages etc.
V.Training and Development: Systematic training helps in increasing the skills and knowledge of employees in doing their jobs through various methods.Development involves growth of an employee in all respects. It is the process by which the employees acquire skills and competence to do their present jobs and increase their capabilities for higher jobs in future.
VI. Performance Appraisal: It is concerned with rating or evaluating the performance of employees. Transfers and promotions of the staff are based on performance appraisal.

 TRUE OR FALSE

1. Spending money on training is waste when we are already spending huge amount in selection of efficient employees. false 
2. Internal recruitment motivates existing employees. True 
3. Operational problems can be solved by training.   True 
4. When a trainee learns under the guidance of a master worker it is called Vestibule school. false
5. In internship, the employee works under the guidance of master work. false

Organising - It refers to the process of defining and grouping the activities of an enterprise and establishing authority relationship among them.

Organising Process-

1. Identification and Division of Work

2. Departmentation

3. Assignment of duties

4. Estabilishing reporting relationship.

Types of organisation-

1. Formal Organisation – An organization which is deliberately created to achieve organizational objectives

2. Informal organisation – Natural grouping of people in organization to satisfy personal and social needs of employees.

Organisation Structures-

1. Funtional Structure – Created on the basis of different functions.

2. Divisional Structure – Created on the basis of different products produced by business

Delegation of Authority- Transfer of authority from superiors to his subordinates.

Elements-

1. Authority

2. Responsibility

3. Accountability.

Decentralisation- It refers to the systematic transfer of authority throughout the organisation on permanent basis.

Importance of decentralisation:

i) Relief to top management

ii) Develops initiative among subordinates

iii) Develops managerial talent for the future

iv) Facilitates growth

v) Quick decision making

vi) Better control 

VERY SHORT ANSWER QUESTIONS

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

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

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 so low. 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. 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 onemakes the atmosphere pleasant.
Identify the concept of management concerning the employees described in the above paragraph.
Answer: Informal organization

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

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

Question. In order to successfully realize the objectives of an organization, first of all it is ensured that which activities will have to be preformed. 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. 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

SHORT ANSWER QUESTIONS

Question. State any three advantages of informal organization.
Answer: a) Effective communication: In the absence of any definite course, it is an effective systemof communication. Messages can be quickly conveyed fromone 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 organisational or personal matters.
c) Fulfils organizational objectives in informal organisation, 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 work or responsibility is handed over. Its importance are:
a) Effective management: Delegation of authority reduces the workload of a manager.
Mangers who practice delegation of authority are definitely better decisionmakers 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 organisation to take decisions expansion modernisation and diversification of a business can be done with full confidence.

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. ‘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 ofmanagement 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. ‘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. 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 develo0pment of varied skills in a divisional head.
b) Quick decisionmaking: Every division is independent in itself. The divisionalmanager 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.

Question. Fairy Fashions decided that whenever a person reaches a particular age, he will be promoted.
Influenced by this policy of the company, several peoples of other companies joined this company. But within a few days, they found that in this company communication was
possible only on the basis pre decided relations. Itwas not possible for anyone to communicate freely with anyone.
a) Identify the policy related to the age of employees implemented by the company.
b) Identify the concept of organization described here.
c) Point out two limitations of the concept identified in (b).
Answer: a) Personnel Policy
b) Formal organization
c) i) Lack of initiative
i) Mechanization of Relations

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. ‘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. Distinguish between Delegation of Authority and Decentralisation
Answer: 

LONG ANSWER QUESTIONS

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 interdepartmental coordination: All departmental heads may work as per their own wish. No doubt this facilitates coordination within the department but it makes interdepartmental 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. ‘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. 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 increasingAdministrative 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 theAdministrative 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.

Question. With the help of any four points, explain the crucial role that organizing plays in an enterprise.
Answer: a) Adaptation to change: Organising process makes the organisation capable of adopting to any change connected with the post of the employees. This becomes possible only because of the fact that there is a clear scalar chain of authority for the manager’s right from the top to the bottom
b) EffectiveAdministration: It has generally been observed that there is always a condition of doubt about the authority of the managers among themselves. The process of organising makes a clear mention of each and every activity of every manager and also of their extent of authority. It is also made clear as to whom shall a manager order for a particular job .Everybody also knows to whom they are accountable.
c) Expansion and growth: The process of organising allows the employees the freedom to take decisions which helps themto grow. They are always ready to face new challenges.
This situation can help in the development of the enterprise.
d) Clarity in working relationship: Organising clarifies the working relation among employees. It specifies who is to report whom. Therefore, communication becomes effective. It also helps in fixing accountability.

Question. Distinguish between Formal and Informal Organization
Answer: 

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.

 MCQs for NCERT Class 12 Business Studies Organising

 Question. In which situation the divisional structure happens to be appropriate?

(a) Where the number of major products is more than one
(b) Where the size of the organisation is quite large
(c) Both the above
(d) Where primarily only one product is sold

Answer : C

Question. Ram was given a task by his superior to prepare a plan in 15 days. He asked two of his subordinates to work upon two aspects of his task. One of the subordinate met with an accident and could not complete his work. Who is answerable for this task?
(applied)
a) Ram is accountable.
b) Ram’s subordinate is responsible. .
c) Ram’s superior is responsible.
d) None of them is responsible.
Answer : A

Question. Decentralisation is (remembering)
a) Selected dispersal of authority.
b) Authority to be retained by top level.
c) Transfer of responsibility to lower levels without authority.
d) Dispersal of authority to the subordinates within prescribed limits.
Answer : A

Question. Name the type of organisation which is deliberately design by top management to achieve a common organisational objective 
a. Informal organisation
b. Corporate organisation
c. Formal organisation
d. Non corporate organisation

Answer : Formal organisation

Question. Which of the following is not an element of delegation?
1. Accountability 
2. Authority
3. Responsibility
4. Informal organisation

Answer : D

Question. Span of management refers to
(a) Number of managers
(b) Length of term for which a manager is appointed
(c) Number of subordinates under a superior
(d) Number of members in top management

Answer : C

Question. Number of sub-ordinates under a superior is called:
(a) Office environment
(b) Strict control
(c) Span of management
(d) Scalar chain

Answer : C

Question. A network of social relationships that arises spontaneously due to interaction at work is called R/U
1. Formal organisation
2. Delegation
3. Decentralization
4. Informal organisation

Answer : D

Important Questions  for NCERT Class 12 Business Studies Organising

Question. Evenly distribution of authority at every level leads to

(a) Delegation
(b) Decentralisation
(c) Informal Organisation
(d) Formal Organisation

Answer :  B

Question. Fast decision can be taken by using the concept of
(a) Delegation
(b) Formal Organisation
(c) Decentralisation
(d) None of the above

Answer :  C

Question. Which of the following is a routine activity
(a) Decentralisation
(b) Delegation
(c) Formal Organisation
(d) Informal Organisation

Answer :  B

Question. Who reports to whom is decided in the following step of organising process
(a) Identifying the activities
(b) Grouping the activities
(c) Assignment of duties
(d) Establish authority relationship

Answer :  D

Question. Informal organisation is dependent on
(a) Formal Organisation
(b) Delegation
(c) Decentralisation
(d) None of the above

Answer :  A

Question. Which organisation gets created automatically?
(a) Formal Organisation
(b) Informal Organisation
(c) Both (a) and (b)
(d) None of the above

Answer :  B