CBSE Class 12 Business Studies Directing Worksheet Set B

CBSE Class 12 Business Studies Directing (2). Students can download these worksheets and practice them. This will help them to get better marks in examinations. Also refer to other worksheets for the same chapter and other subjects too. Use them for better understanding of the subjects. 

DIRECTING

Meaning:- Directing refers to the process of instructing, guiding, counselling, motivating and leading people in the organisation to achieve its objectives.

Importance:
1. Directing Initiates Action: It helps in initiating action by the people in the organisation towards attainment of desired objectives.
2. Directing Integrates Employee’s Efforts: The efforts of individual employees working at different levels are integrated and coordinated for organisational goals with the help of directing function.
3. Directing guides employees to fully realise their potential: It helps to identify potential of employees and motivates them to contribute their maximum efforts towards the achievement of organisational goals.
4. Directing Facilitates introduction of needed Changes: Employees often resist changes due to fear of adverse effects. Effective leadership reduce such resistance and develop cooperation in introducing changes
5. Directing brings Stability and Balance in the organisation: Effective directing fosters cooperation and commitment among employees and helps to achieve balance among various groups, activities and departments.

Elements of Directing;
(i) Supervision: supervision being an element of directing can be understood as the process of guiding the efforts of employees and other resources to accomplish desired objectives .It implies overseeing the work of subordinates by their superiors. Supervision can also be understood as the function performed by supervisor
(ii) Motivation: It means the process of making subordinates to act in a desired manner to achieve certain organisational goals.
(iii) Leadership: Leadership is the process of influencing the behaviour of people by making them strive voluntarily towards achievement of organisational goals.
(iv) Communications: is the process of passing information, experience, opinion etc. from one person to another.

Motivation:
Motivation means incitement or inducement to act or move.
Motivation is the process of stimulating people to action to accomplish desired goals.
Three key terms = motive, motivation, motivators
Motive: Inner state that energises, activates and directs behaviour towards goals. Arises out of unsatisfied needs and causes restlessness.
Motivation: Process of stimulating people to action to accomplish desired goals.
Motivators: Techniques like giving bonus, promotion etc to motivate people.

Maslow's Need Hierarchy Theory of Motivation
This theory was given by Abraham Maslow in 1943, and is based on human needs.
According to Maslow within every human being, there exists a hierarchy of five needs which are the following:
1. Basic Physiological Needs: These are the most basic needs such as food, shelter, sleep etc. In the organisational context, basic salary helps to satisfy these needs.
2. Safety/ Security Need: Provide security from physical and emotional harm E.g. Job security, stability Etc.
3. Affiliation/Belonging Need: These needs refer to affection, sense of belongingness, acceptance and friendship for mental satisfaction.
4. Esteem Needs: These include factors such as self-respect, prestige, autonomy status, recognition and attention.
5. Self-Actualization Needs: It is the highest level of need in the hierarchy. It refers to the drive to become what one is capable of becoming.

Assumptions:
1. People’s behaviour is based on their needs. Satisfaction of such needs influences their behaviour.
2. People’s needs are in hierarchical order, starting from basic needs to other higher level needs.
3. A satisfied need can no longer motivate a person
4. A person moves to the next higher level of hierarchy only when the lower need is satisfied

Financial and Non-Financial Incentives
Incentives are the means to satisfy an employee's needs and motives. These can be: Financial and Non-Financial

Financial Incentives
Incentives offered to employees which are either in direct monetary form or can be valued in monetary terms.

Types of Financial Incentives
1. Pay and allowances: These include salary, dearness allowance and other allowances paid to employees.
2. Productivity linked wage incentives: Wages paid at different rates to increase productivity.
3. Bonus: Incentive offered above the wages or salary.
4. Profit Sharing: Providing a fixed percentage of profit to employees.
5. Co-partnership/ Stock option: Shares offered to employees at a price which is lower than the market price.
6. Retirement benefits: Benefits offered after retirement such as provident fund, pension, etc.
7. Perquisites: Benefits over and above the salary offered such as car allowance, housing, medical aid, etc.

Non-Financial Incentives:
Incentives which focus on psychological, social and emotional factors which play an important role in providing motivation .

Types of Non-Financial Incentives
1. Status: It means ranking of positions in the organisation. The authority, responsibility, rewards, recognition, perquisites and prestige of a job indicates status
2. Organisational climate: Characteristics influencing an individual's behaviour such as individual autonomy, reward orientation, consideration to employees, etc.
3. Career Advancement Opportunity: Opportunities of growth and development in the organisation to the higher level.
4. Job enrichment: It is concerned with designing jobs that include greater variety of work content ,require higher level of knowledge and skill, more autonomy and responsibility and provide the opportunity for personal growth.
5. Employee recognition programmes: It involves recognising and appreciating the contribution of employees in public.
6. Job security: It refers to the certainty and stability offered in a job about future income and work.
7. Employee participation: Involvement of employees in the decision making process, seeking their suggestions.
8. Employee empowerment: Empowerment by giving more autonomy and powers to subordinates makes people feel that their jobs are important and makes them use their skills and talents in jobs.

Leadership
Leadership is the process of influencing the behaviour of people by making them strive voluntarily towards achievement of organisational goals.

Features of Leadership
1. Leadership indicates the ability of an individual to influence others.
2. Leadership tries to transform the behaviour of the subordinates.
3. Leadership indicates interpersonal relationship between leader and followers.
4. Leadership is exercised to achieve organisational goals.
5. Leadership is a continuous process.

Leadership Styles
1. Autocratic leadership: in this style of leadership, a leader takes all the decisions on his own and gives orders to his or her subordinate to implement them.
2. Democratic leadership: In this style of leadership a leader takes decisions after consulting with subordinates and encourages them to participate in decision making.
3. Laissez faire leadership: In this style of leadership a leader gives freedom to his subordinate to take decisions and execute work assigned to them and the leader acts as observer or guide.

Communication
Communication is the process by which people create and share information with one another in order to create common understanding.

Elements of Communication Process
1. Sender: The person who conveys his thoughts or ideas.
2. Message: Content intended to be communicated.
3. Encoding: Process of converting message into communication.
4. Media: Path through which an encoded message is transmitted to the receiver.
5. Decoding: It is the process of converting the encoded message in a readable format.
6. Receiver: The person who receives a communication message from the sender.
7. Feedback: It refers to the information or suggestions provided by the receiver to the sender in context to the communication or message he received.
8. Noise: The hindrances and obstruction to communication.

Formal and Informal Communication
The process of communication within an organisation may be Formal or Informal.

Formal communication
It flows through official channels designed in the organisation chart to communicate official information between employees.

Formal communication is classified as:

Vertical communication: It is the formal two-way communication between superior and subordinate and the communication flows upward or downward.

Horizontal communication: It is the formal two-way communication between employees working at the same level of authority.

Formal Communication Networks
Single chain: Communication flows from superior to his immediate subordinate.
Wheel: Superior acts as a hub of information and all subordinates communicate through the superior only.
Circular: Employees communicate with his or her adjoining people.
Free flow: All employees are free to communicate with each other without any restrictions.
Inverted V: An employee communicates with his or her immediate superior but may also communicate with his/her superior’s superior.

Informal communication
Communication between employees who are not officially related to each other is called informal communication, this type of communication may flow in any direction thus it is also called 'grapevine'.
The informal communication spreads information rapidly and sometimes generates rumours.

Grapevine Network
Grapevine communication, also known as informal communication, is a communication that develops as a result of social interaction among employees and spreads without following the formal communication path.
The types of grapevine communication networks are as follows.
Single Strand Network: An employee communicates with other employees in sequence.
Gossip Network: In a gossip network, one person spreads information to a large number of people.
Probability Network: In a probability network, an individual shares information with other people at random.
Cluster Network: Information in this network is first shared between two people who trust each Other.

Barriers to communication
Sometimes the message sent by the sender does not reach the receiver in the same manner as expected by the sender. The barriers can be categorised as:
a. Semantic barriers
b. Psychological barriers
c. Organisational barriers
d. Personal barriers

Semantic barriers: semantic barriers are concerned with the problems and obstructions in the process of encoding and decoding a message into words or impressions. These are:
1. Badly expressed message: Due to lack of vocabulary, Managers may use wrong words, omission of needed words results in failure to convey the same meaning to subordinates.
2. Symbols with different meanings: A word may have different meanings and the receiver may understand other meanings.
3. Communications drafted in one language translated into another language may be understood in different meanings .
4. Unclarified assumptions: Sam Communications Ne have certain assumptions which are subject to 2 different interpretations.
5. Technical jargon: Using of Technical jargon by experts to persons who are not specialist in the concerned field May cause Difficulty in understanding
6. Body language and gesture decoding: if there is no match between what is said and what is expressed in body movements, Communications may be rongli perceived .

Psychological barriers: Emotional or psychological factors act as barriers to communication. Some of the psychological barriers are:
1. Premature evaluation: evaluation of message before the sender completes his message results in premature evaluation of message.
2. Lack of attention; preoccupied mind of receiver and the resultant non- listening of message acts as a major psychological barrier
3. Loss by transmission and poor retention: when communication passes through various levels successive transmissions of the message result in laws for transmission of inaccurate information. people cannot retain the information for a long time if they are inattentive
4. Distrust: If the parties do not believe each other, they cannot understand each other's message in its original sense

Organisational barriers: The factors related to organisational structure, authority relationship rules and regulations may act as barrier. Some of these barriers are:
1. organisational policy: If organisational policy is not supportive to free flow of communication it may hamper effectiveness of communications.
2. Rules and regulations: Rigid rules and complicated procedures may be a hurdle to communication.
3. status: A status conscious manager also may not allow his subordinates to express their feelings freely.
4. Organisational facilities: Frequent meetings, suggestion complaints etc will encourage free flow of communication.

Personal barriers: Personal factors of both sender and receiver may excerpt influence on effective communication. Some of the personal barriers mentioned below:
1. Fear of challenge to authorities
2. Lack of confidence of superior on his subordinate
3. Unwillingness to communicate
4. lack of proper incentives.

VERY SHORT ANSWER QUESTIONS :

Question. Name the incentive which refers to ‘give more autonomy and powers to subordinates’ and how are people affected by this incentives?
Answer : Employee Empowerment: Due to this incentive people start feeling that their jobs are important and they contribute positively to use their skills and talent in the job performance.

Question. It means overseeing the subordinates at work. Which element of directing is referred to?
Answer : Supervision.

Question. Which element in communication process relates to the process of converting encoded symbols of the sender?
Answer : Decoding

Question. Give any two elements of directing.
Answer : (i) Supervision
(ii) leadership.

Question. It refers to the way in which urges, drives, desires, aspirations, strivings or needs direct control and explain the behaviour of human beings. Which element of directing is indicated here?
Answer : Motivation.

Question. It is defined as a process of influencing other people to work willingly for group objectives. Mention this element of directing.
Answer : Leadership

Question. Which need in the hierarchy theory of motivation refers to affection, acceptance and friendship?
Answer : Belonging needs

Question. Explain in one sentence how directing initiates action in management.
Answer : Directing initiates action by ordering employees to attain the desired goal of an organisation.

Question. State the element of directing which helps in implementing the principle of scalar chain.
Answer : Communication helps in implementing the principle of scalar chain.

Question. It is an incentive offered over and above the wages/salary to the employees. Name the type of financial incentive referred here.
Answer : Bonus

SHORT ANSWER QUESTIONS :

Question. State three advantages of Motivation.
Answer : a) Motivation sets in motion the action of people:
Motivation bridges the gap between the ability to work and willingness to work. It enables the management to secure the best utilization of physical and financial resources.
b) Motivation improves the efficiency of work performance. As motivation builds the willingness to work among the employees, the persons work with initiativeness thereby increasing their work performance.
c) Motivation leads to stability in the employees. Motivation helps in reducing the labor turnover and absenteeism. It creates confidence among the employees and secure their loyalty to the organization.

Question. Distinguish between Leadership and Management
Answer :
Basis                           Leadership                                                                                            Management

Origin                          Leadership originates out of individuals influence      Management originates out of official powers and rights.
Functions                    A leader is to motivate and guide his followers           A manager has to plan, organize, direct and control his employees.
Mutual relationship     All the leaders are not the managers                          All the Managers are leaders.

Question. Discuss three qualities of a leader.
Answer : a) Listening skill: A good leader is a good listener. Leaders have to create a culture where people can be frank and share the information. Receiving feedback about oneself is important.
b) Self confidence: A leader must have confidence in his own ability to accomplish tasks and meet the needs of every situation.
c) Intelligence: A Leader should examine every problem in a right perspective. He should have a logical mind and objective outlook free of bias.

Question. What is ‘Noise’ in the process of communication?
Answer : ‘Noise’ is the disruption interference in the process of communication. It can occur at any point in the process of communication i.e at the point of transmission or decoding.
For e.g if you are chatting and disruption in the network connection, if you are talking on a phone, disconnection of the telephone line etc.
Noise can also arise due to bad communication skill of the sender, inattentive listener,use of technical and difficult words etc. Thus Noise can be anything that hampers Understanding in the process of Communication.

Question. State three Financial incentives.
Answer : Financial Incentives — Incentives which are directly or indirectly associated with monetary benefits.
Non Financial Incentives — Incentives which are not measurable in terms of money.
Examples for financial Incentives — Pay, allowances productivity linked wage incentives, Bonus, Retirement benefits, Copartnership.
Eq Non Financial Incentives — Status, organizational climate, career advancement opportunity, job security etc.

Question. State three non monetary incentives.
Answer : (a) Job Enrichment — is a method of motivating employee by making the task to be performed by him more interesting and challenging. The job in itself serves as a source of motivation to the employee and brings out the best in him.
(b) Suggestion System — Is a system where suggestions regarding the work procedure, environment are solicited from employees. This increase their participation & importance in the working of the enterprise and hence motivates them.
(c) Job Security refers to making the employee feel safe in his job positions. He is not threatened by transfers or removal from service and hence performs to the best of his abilities.

Question. State three psychological barriers to effective communication
Answer : a) Premature evaluation: If a person has a pre-conceived notion against the communication then he will evaluate the meaning of the communication before he listens to it.
b) Lack of attention : The listener may be physically present and not mentally. He may be preoccupied with some other thoughts.
c) Loss of transmission and poor retention. Many people cannot retain the information for a long period due to poor retention power.

Question. Discuss Three Principles of Directing
Answer : a) Maximum Individual contribution: According to this principle, directing must help every individual employee to contribute his Best towards the achievement of organizational goal.
b) Harmony of objectives : Directing must ensure that the individual goals of employees and that of organization do not conflict with each other. Directing must aim at bringing harmony among them.
c) Follow through : Managers must continuously review whether the instructions are being understood and followed by the employees or not.

Question. State any three types of needs that govern human motivation.
Answer : Understanding and influencing the human behaviour requires understanding their needs. It can be
a) Physiological needs (Need for food, clothing shelter, education etc)
b) Security needs (need of safety and freedom from fear or threat)
c) Social needs ( need for love, affection, belongingness)
d) Esteem needs ( need for recognition, need for self respect)
e) Self actualization (need to grow, sense of fulfillment)

Question. “Managerial functions cannot be carried out without an efficient system of communication.” Do you agree? Give any three reasons in support of your answer.
Answer : Yes, I agree with this statement.
Communication is important because of the following reasons.
i. Communication facilitates planning in a number of ways
ii. Communication helps management in arriving at vital decisions
iii .Communication is necessary in creating unity of action of action

Question. What is meant by financial incentives? State any two financial incentives.
Answer : Financial incentives refer to incentives which are in direct monetary form and serves to motivate people for better performance.
Two financial incentives are:
i. Pay and allowances: Salary is the basic monetary incentive for every employee. It includes basic pay, dearness allowance and other allowances.
ii. Productivity linked wage incentives: Many wage incentives are linked with the increase in productivity at individual or group level. For example, a worker is paid 50 rupees per piece if he produces 50 pieces a day but if he produces more than 50 pieces a day, he is paid 5 rupees extra per piece. Thus, on the 51st piece, he will be paid 55 rupees.

Question. To satisfy the social and physiological needs which type of incentives are needed? Explain any four types of such incentives.
Answer : Psychological, cognitive and social factors can play a role in what incentives one finds motivating and to what degree. Incentives can be used to get people to engage in certain behaviours, but they can also be used to get people to stop performing certain actions. Financial incentives are needed to satisfy the social and physiological needs. Four types of such incentives are
i. Pay and allowances: Salary is the basic monetary incentive for every employee. It includes basic pay, dearness allowance and other allowances like House Rent Allowance, Entertainment allowance etc. Under salary system, employees get regular annual increments and enhancement of allowances from time to time.
ii. Profit sharing: Sometimes a company or a business firm may share some part of its profit with the employees. The main purpose of sharing profits with the employees is to improve their performance so that they can contribute more in increasing the productivity and profits of the firm.
iii. Productivity linked wage incentives: Employees can be motivated by giving them productivity linked wage incentives. There are certain wage rate plans which offer higher wage for more efficient worker for example; different piece wage system allows high wages to efficient workers as compared to inefficient workers.
iv. Co-partnership/Stock option: Sometimes companies offer their shares to its employees at a set price which is lower than the market price. The main purpose of allotting shares to the employees is to create a feeling of ownership among them so that they can contribute more for the growth of the organization.

Question. Define the terms ‘motive’, ‘motivation’ and ‘motivator’. 
Answer : i. Motive: A motive is an inner state that energizes, activates or moves and directs behaviour towards goals. Motives arise out of the needs of individuals. Realisation of a motive causes restlessness in the individual which prompts some action to reduce such restlessness.
ii. Motivation: Motivation is the process of stimulating people to action to accomplish desired goals. Motivation depends upon satisfying needs of people.
iii. Motivator: Motivator is the technique used to motivate people in an organisation. Managers use diverse motivators like pay, bonus, promotion, recognitio

Question. How directing helps in efficient and effective functioning of the organisation? Explain by giving any three points. 
Answer : (i) It integrates employees Directing integrates employees’ efforts in the organisation in such a way that every individual’s efforts contributes to the welfare of the organisation. Thus, it ensures that employees work efficiently for the attainment of goals.
(ii) It improves efficiency Directing guides employees to fully realise their potentials and capabilities. Through this function, managers utilise the potential of employees and persuade them to work with the best of their ability and contribute their maximum efforts towards the achievement of organisational objectives.
(iii) It facilitates change Business environment is changing very frequently, but the people generally have a tendency to resist change. In this context, directing helps manager to persuade his subordinates to carry out changes from time to time to cope with changes in the environment as the changes are necessary to adapt and it is the need of modern business

Question. Ayasha Ltd. assured their employees that in spite of recession, no worker will be retrenched from the job.
a. Name and explain the type of incentive offered to the employees.
b. Explain one more incentive of the same category. 
Answer : i. The name of the incentive offered is Job security. Employees want their job to be secure. They want certain stability about future income and work so that they do not feel worried on these aspect and work with greater zeal.
ii. Employee participation: It means involving employees in decision making if the issues related to them. In many companies, these programmes are in practice in the form of joint management committees, work committees, canteen committees etc.

LONG ANSWER QUESTIONS :

Question. What is meant by communication? Explain how communication is an important function of management.
Answer : Communication is a two-way process wherein the message in the form of ideas, thoughts, feelings, opinions is transmitted between two or more persons with the intent of creating a shared understanding. Simply, an act of conveying intended information and understanding from one person to another is called as communication. The term communication is derived from the Latin word “Communis” which means to share. Effective communication is when the message conveyed by the sender is understood by the receiver in exactly the same way as it was intended.
Importance of communication is explained as follows:
i. Acts as a basis of coordination: Communication acts as a basis of coordination. It provides coordination among departments, activities and persons in the organisation. Such coordination is provided for explaining about organisational goals, the mode to their achievement and inter relationships between different individuals, etc.
ii. Acts as a basis of decision-making: The decisions made in an organisation depends largely on the amount and quality of information available On the basis of communication of relevant information, one can take the right decisions.
iii. Increases managerial efficiency: The employees must know clearly about their responsibilities and authority, who will report to whom, what part of the total job they are expected to perform and what are their decision-making powers.
iv. Helps in the process of motivation and morale: Motivation and morale of employees largely depend upon the effectiveness of communication. Sharing of information with employees helps management to secure their willing cooperation.
v. Effective leadership: Communication is the basis of leadership. By developing the skills of communication, a manager can be a real leader of his subordinates. A good system of communication brings them m close contact with each other and removes misunderstandings.

Question. Directing is the heart of the management process. Do you agree? Give any four reasons in support of your answer.
Answer : Yes, I do agree with this statement. Directing may be regarded as the heart of the management process; Its importance may be explained under the following points 
(i) Initiates action Directing helps to initiate action by people in the organisation towards attainment of desired objectives, e.g. if a supervisor guides his subordinates and clarifies their bdoubts in performing a task, it will help workers to achieve work targets given to them.
(ii) Integrates employees’ efforts Directing integrates employees’ efforts in the organisation in such a way that every individual effort contributes to the attainment of organisational objectives. Thus, it ensures that the individuals work for organisational goals.
(iii) Improves efficiency Directing guides employees to fully realise their potential and capabilities by motivating and providing effective leadership. A good leader can always identify the potential of his employees and motivate them to extract work up to their potential.
(iv) Brings balance and stability in the organisation Effective directing helps to bring stability and balance in the organisation since, it fosters cooperation and commitment among the people and helps to achieve balance among various group activities and the departments.

Question. Describe the concept of Authoritative leadership and state its advantages? 
Answer : Autocratic/Authoritarian leadership under this style, leader concentrates all authority in himself, instructs subordinates as to what to do, when to do it; how to do it, etc. He also exercises close supervision and control over his subordinates. Subordinates are expected to do what they are told. The autocratic leader accomplishes the results through the use of authority, fear of deprivation, punishment and such other negative rewards. As it is negative in character, authoritarian approach will succeed only in the short run.
Advantages of Autocratic Leadership:
i. It provides for quick decision-making because here only one person i.e., the leader takes decisions.
ii. Mostly subordinates like to work under centralized authority and strict supervision.
iii. As there is no consultation with subordinates, confidential matters can be kept secretly.
iv. Leadership gives strong motivation and satisfaction to the leader who dictates terms.
v. At lower levels, only less competent subordinates are required.
vi. This style may yield positive outcome if great speed is needed.

Question. Explain in brief the elements of the communication process.
Answer : The elements involved in the communication process are explained below –Sender: Sender means a person who conveys his thoughts or ideas to the ‘ receiver. The sender represents a source of communication.
Message: It is the content of ideas, feelings, suggestions, order, etc. intended to be communicated.
Encoding: It is the process of converting the message into communication symbols such as words, pictures, gestures, etc.
Media: It is The path through which an encoded message is transmitted to the receiver. The channel may be in written form, face to face, phone call, internet, etc.
Decoding: It is the process of converting encoded symbols of the sender.
Receiver: The person who receives communication from the sender.
Feedback: It includes all those actions of the receiver indicating that he has received and understood the message of the sender.
Noise: Noise means some obstruction or hindrance to communication.

Question. Distinguish between Formal communication and Informal communication
Answer: 

Question. State the measures that can be taken to reduce the barriers to effective communication
Answer: The barriers to an effective communication can be reduced by following measures :—
(i) Clarify the Idea : Clarify in the thoughts of the sender is must for effective ‘communication’.
(ii) Use of proper people language : Sender should try to make the message meaningful and understandable by using appropriate words.
(iii) Message should be precise : Lengthy and unwarranted elaboration makes message less meaningful this should be avoided.
(iv) Ensure proper feedback : The sender of the message should take the feedback from the receiver. Feedback of the conveyed message is an essential tool to the check that the message is duly understood.
(v) Effective use of organisation Facilities : Effective use of organizational facilities like suggestion box complaint box secret box helps in making the communication effective.

Question. Discuss in brief the functions of a Supervisor
Answer: Supervision means overseeing the subordinates at work. Supervision performs the following important functions which help the organisation to achieve objectives function of the supervisor:
a) Planning the work: The supervisor has to determine work schedule for even and steady flow of work.
b) Issuing orders: The supervisor issues orders and instructions to the workers for achieving coordination.
c) Providing guidance and leadership : The supervisors leads the workers of his department. He fixes production targets for them & provides them the necessary guidance for doming the work assigned to them.
d) Motivation : The supervisor motivates his subordinates by providing financial and non financial incentives. He inspires them for higher quality & productivity.
e) Controlling output — The supervisor controls the performance of the workers by comparing their performance with the standards. He also takes necessary action to ensure that production is done according to the predetermined standards.

Question. Discuss six monetary Incentives.
Answer: The incentives that have a monetary and financial benefit are called financial incentives. 
Profit sharing : It has been accepted that the profit earned by the firm is also due to the effort put by the workers. So they have a full right to receive a share in it. It is an effective incentive which satisfies the workers.
b) Co-partnership: Under this system, employees share the capital as well as the profits. Under employees stock option plan the workers are given shares. They are also given Bonus shares and they share the ownership of the firm. It motivates them as they share the profits too.
c) Productivity linked wages: Under this system, a sales person is guaranteed a minimum wage as well as commission on sales. A commission plan motivates him to work better.
d) Suggestion system: Valuable suggestions are accepted and the most valuable ones are also rewarded with cash money.
e) Retirement benefits: Every employee wants his future to be secured. The firm provides retirement benefits, pension, provident fund, gratuity etc.
f) Perks: various perks such as housing, car allowance foreign trips etc can be given to the managers to boost up his morale.

Question. Discuss the Importance of Communication .
Answer: Communication is a process of understanding between the persons through exchange of ideas, messages, suggestions etc. It is important due to the following reasons –
a) It facilitates Planning : Participation of all the executives in planning is a pre requisite for getting the task done. This participation is possible only when the managers and employees interact with each other. There should be no communication gap.
b) It helps in decision making: Most of the decisions are taken up by the top level management.
But for decision making, right type of information is required from different persons.It is through communication that people come together in a firm, managers can identify the
problems faced by the employees, so that he can take the decisions effectively.
c) It helps in the process of motivation : Sharing of the information with the subordinate gains their confidence and willing cooperation.
Discussion on common interest of the management and workers is a source of satisfaction for the employees as it gives them recognition. It increases their morale of doing work.
d) It is a basis of effective leadership:
A good communicator is a good leader. Through good communication skill, the manager comes closer to his subordinates and removes the misunderstanding. Thus it is the basis of leadership.

Important Questions for NCERT Class 12 Business Studies Directing

Question. What out of the following does supervision ensure?
(a) Ensures issuing instructions
(b) Facilitates Control
(c) Both the above
(d) Industrial Conflicts

Answer : C

Question. Which is not the advantage of formal communication?
a. Very systematic
b. Friendly relationship
c. Orderly flow of information
d. Easy to exercise control 

Answer : B

Question. Which two parties are involved in communication process?
a. Encoder & Decoder
b. Superior & Subordinate
c. Sender & Receiver
d. Buyer & Seller 

Answer : C

Question. What is the name of the need which makes an individual to take his ability to the highest level?
(a) Esteem Need
(b) Self Actualisation Need
(c) Security Need
(d) All the above

Answer : B

Question. Which is not the features of leadership
a. It indicates the ability of individual
b. It tries to bring change in behavior
c. It shows interpersonal relationship
d. It is based on personal goal 

Answer : D

Question. Which of the following leadership styles has the speciality of centralised authority?
(a) Autocratic leadership style
(b) Democratic leadership style
(c) Free-rein leadership style
(d) None of the above

Answer : A

Question. A person who has the ability to influence others is called ________ .
(a) Leader
(b) Manager
(c) Chief Manager
(d) Supervisor

Answer : A

Question. Manager + Leadership ability = ________ .
(a) Loss
(b) Success
(c) Failure
(d) Nothing (Zero)

Answer : B

Question. ________ is necessary for the existence of a leader.
(a) Manager
(b) Employee
(c) Follower
(d) Worker

Answer : C

Question. Which non-financial incentive has negative aspect?
a. Status
b. Career Advancement Opportunity
c. Job security
d. Job Enrichment

Answer : C

Question. The lowest level need in the need hierarchy theory of Abraham Maslow is
a. Safety need
b. Belongingness need
c. Esteem need
d. Physiological need 

Answer : D

Question. Which one of the following is not an element of direction?
(a) Motivation
(b) Communication
(c) Delegation
(d) Supervision

Answer :  C

Question. The motivation theory which classifies needs in hierarchical order is developed by
(a) Fred Luthans
(b) Scott
(c) Abraham Maslow
(d) Peter F. Drucker

Answer :  C

Question. Identify the correct sequence of steps involved in the communication process.
(a) Sender, Message, Encoding, Media, Decoding, Receiver
(b) Sender, Decoding, Receiver, Feedback, Message, Encoding, Media
(c) Sender, Message, Encoding, Media, Decoding, Receiver, Feedback
(d) Sender, Media, Decoding, Receiver, Message, Encoding, Feedback

Answer : C

Question. ___ aims at instructing, guiding, motivating people to achieve the desired results.
(a) Communication
(b) Directing
(c) Motivating
(d) Organising

Answer : B

Question Identify the correct sequence of steps involved in the motivation process.
(a) Tension, drives, search behaviour, unsatisfied need, satisfied behaviour, reduction of tension
(b) Unsatisfied need, tension, drives, search behaviour, satisfied behaviour, reduction of tension
(c) Drives, search behaviour, unsatisfied need, tension, satisfied behaviour, reduction of tension
(d) Search behaviour, reduction of tension, unsatisfied need, tension, drives, satisfied behaviour

Answer : B

Question. Which one of the following is an element of directing?
(a) Delegating authority
(b) Designing organisation structure
(c) Communication
(d) Designing control system

Answer : C

Question__________ is the process of influencing the behaviour of people making them strive voluntarily towards achievement of goals
(a) Motivation
(b) Communication
(c) Leadership
(d) Directing

Answer : C

Question. It refers to the process of exchange of ideas, views, facts, feelings etc., between or among people to create common understanding.
(a) Supervision
(b) Communication
(c) Motivation
(d) Leadership

Answer : B
Question. Which of the following is not a characteristic of directing?
(a) Directing initiate action
(b) It is a continuous process
(c) Flows from top to bottom
(d) Ensuring order & discipline

Answer : D

Question. Which of the following is not an element of directing?
(a) Supervision
(b) Motivation
(c) Leadership
(d) Delegation

Answer : D

Question. _______ is the process of guiding the efforts of employees to accomplish the desired goal.
(a) Supervision
(b) Directing
(c) Controlling
(d) Motivating

Answer : A

FILL IN THE BLANKS

1. Motivation is a psychological process.
2. Complete delegation of authority is part of Free Rain style of leadership.
3. Under Psychological Barrier category of communication barriers, senders and receivers have different state of mind.
4. The need for love, affection and companionship comes under Social need.
5. Basic necessities like food, shelter, clothing, fresh air, etc. come under Psychological need.
6. According to Maslow, human needs follows a Hirarchy.
7. Motivation develops Willingness to work.
8. To fulfil esteem need, Employees recognition or Non-monetary incentive is suitable.
9. Leadership is a process of Influencing the behaviour of employees.
10. Communication is a Two way process.