CBSE Important Questions Class 12 Business Studies Chapter 1

Important Questions for CBSE Class 12 Business Studies Chapter 1 – Nature and Significance of Management

In these important questions class 12 business studies chapter 1, students will learn the important questions of the chapter Nature and Significance of Management. This is an important topic in business studies, and reading this chapter 1 class 12 business studies important questions will help you understand the pattern of questions that may come in your examination. 

These business studies class 12 chapter 1 important questions contain CBSE extra questions that students can use to prepare for their business studies examination. 

CBSE Class 12 Business Studies Chapter-1 Important Questions

Study Important Question CBSE Important Questions for Class 12 Business Studies Chapter 1 – Nature and Significance of Management

1 or 2 Mark Questions

1. Define the term management.

Ans. By adopting the appropriate strategies and methods, management refers to the practice of effectively and efficiently managing people and tasks.

1. Is management just focused on carrying out proper tasks, finishing off activities, and accomplishing targets, without taking the cost-benefit into account? Give evidence to back up your response.

Ans. No, in order to achieve organizational goals, management must concentrate on both effectiveness and efficiency, i.e., accomplishing the task quickly, affordably, and with the best possible use of available resources.

1. Name any two of the social goals of management.

Ans. Here are two social goals of management.

• Granting physically handicapped groups in society equal work opportunities.
• To assist in raising societal standards of living through promoting the growth of rural, regional, and underdeveloped areas.

1. What is the importance of management?

Ans. Given below is the importance of management

• It increases efficiency.
• It helps in the creation of dynamic organizations.
• It helps to achieve group and organizational goals.
• It helps in developing society.

1. What do you mean by “management of operations”?

Ans. Every organization offers some basic good or service that is produced through the flow of input materials and technology that turns these materials into finished goods that may be consumed. Thus, management entails the administration of processes for transforming input into output.

1. Why is management considered a three-tier machinery?

Ans. Since three levels of management exist, namely top, middle, and lower level management, management is thought of as a three-tier machine.

1. How does coordination combine the efforts made by a group? 

Ans: In order to achieve the organization’s goals, diverse people’s interests and efforts are brought together through coordination.

1. Why is management known to be pervasive?

Ans. The tasks required in managing a company are the same for all businesses, whether they are for-profit or non-profit, social or political. That is why management is called pervasive.

3 or 4 Marks Questions

1. Due to the unreliable availability of electricity in rural areas, XYZ Power Ltd. established a plant for the production of solar lights in a far-off village. The company’s earnings were enough to pay for the costs and risks. The corporation chose to raise production because there was a rising daily demand for lanterns, which would lead to larger sales. Since there weren’t many jobs in the area, they chose to hire people from the adjacent villages for this. The business also made the decision to open daycare centres and schools for the kids of its employees.

(i) List and describe the aforementioned managerial goals.

(ii) Name two values that the business wished to convey to society.

Ans. (i) It is connected to management’s social aim. It deals with an organization’s societal obligation. Such goals may have to do with making eco-friendly products, giving the less fortunate in society jobs, etc. 

The corporation has successfully met its organizational goals by taking on the costs and risks. Three factors are connected to this goal:

• Survival: Make sure that business operations continue.
• Profit: Earn a profit that is adequate to pay the business’s expenses and risks.
• Growth: Long-term corporate success is ensured by it.

(ii) First off, by producing solar lanterns, the corporation appreciates the rural population, as they may now use electricity in their own places. Second, by creating jobs, they will improve the standard of living for rural residents.

1. Explain any of the five features of management.

Ans. Here are five features of management: 

• All pervasive: Since it may be used in all forms of organizations, across all disciplines, and at all levels, management is widespread.
• Intangible force: When goals are met in accordance with predetermined plans, management’s presence can be felt despite the fact that it cannot be seen.
• Goal-driven procedure: Every organization has a set of social and economic objectives, and management is supposed to help the organization accomplish these objectives. Management ensures that human, physical, and financial resources are used efficiently and economically.
• Multidimensional: Due to the fact that it involves the management of work, people, and operations, management is multidimensional.
• Group activity: An organization is a collection of various people with various skills. All of these talents and initiatives of various people are channelled and used by management to achieve common organizational objectives.

1. What are some feature of management that makes it not a profession?

Ans. Here are some features that make management not a profession.

• Ethical Guidelines: Every profession has a rigid code of behaviour. This characteristic is absent in management because there is no established code of conduct that a manager must adhere to.
• Service Purpose: Serving consumers with dedication is the fundamental goal of any career. The goal of management, which is typically profit maximization, prevents this attribute from being present.
• Restricted Entry: To become a professional, one must pass a test or possess a degree from an accredited institution. However, there is no requirement for a professional qualification, educational degree, etc., to pursue a career in management.
• Regulatory Body: A legally recognized organization regulates every profession, such as the ICAI for chartered accountants. All India Management Association is one of the associations for management, although these associations are not statutory bodies.

1. What does the term “management” mean? Describe the three characteristics that make it an art.

Ans. The act of getting things done to successfully and efficiently achieve organizational goals is referred to as management. The following are the three characteristics that make it an art form:

Presence of theoretical knowledge

The application of theoretical knowledge is part of art. Management is the art of organizing tasks through people in order to achieve desired outcomes by putting the available information into practice.

Application of personalized approach:

Since knowledge is applied differently by each individual, management is really a personal talent. Even if two individuals undertake the same type of task, their approaches will always be distinct. As an illustration, two vocalists will never have the same performance.

Using practice and imagination:

Management is focused on outcomes and goals. Like art, management likewise demands practice; consistent practice sharpens a person’s abilities and originality.

1. “Management offers insight and direction.” Explain the following statement.

Ans. Since management is a dynamic function, it reacts to changes in the environment, whether internal or external, and assists organizations in developing strategies to adapt to those changes in order to preserve competitive advantage. It supports organizations’ decision-making and long-term planning. Management thus offers insight and direction.

5 or 6 Marks Questions

1. What do you mean by management’s “personal objectives”? List your own management goals.

Ans. Personal objectives are those that are pertinent to each employee’s particular demands inside a business. Every organization is composed of people with a variety of values, experiences, and objectives. People join a company to meet a variety of needs. These are listed below:

(i) Financial requirements such as competitive pay, incentives, and other financial perks.

(ii) In the workplace, social demands like acknowledgement are important.

(iii) Higher level needs that incorporate personal development.

1. Resources cannot be transformed into useful products if effective management is not practised. Do you concur? Cite arguments.

Ans. The following management-related points of importance support the claim:

Achievement of group goals: Management promotes cooperation and bonding among the individuals in the group. Additionally, management encourages group members to contribute to the accomplishment of the shared goal in the greatest way possible. The management itself has established this shared goal.

Maximum resource utilization: To cut costs and increase productivity, management balances the use of people, money, materials, and machines.

Cost minimization: Through better planning, solid management, and efficient control, management increases productivity and lowers costs. Management enables a company to compete fiercely by reducing waste and keeping costs low.

Social development: By offering high-quality goods and services at reasonable prices, management raises the average living standard of the population. It also facilitates the adoption of new technology and the creation of employment prospects.

Achievement of personal goals: Everyone joins an organization in order to pursue their own personal goals. Some people join for a competitive wage package, some for more notoriety, and some people join simply to survive. Thus, it differs from person to person. In order to bring harmony to the organization and ensure that each person’s personal objectives are successfully met, management plays a critical role in identifying personal goals and integrating them with organizational goals.

1. “Management attempts to attain particular objectives, which must result from the fundamental goal of the firm.” Give an explanation of the organizational and social goals of management in light of the aforementioned statement.

Ans. 

Organizational objectives: The management is in charge of establishing and achieving the organization’s goals. It aids in achieving the goals in a way that makes the most economical and effective use of the available financial and human resources in their acquisition, usage, and maintenance. The organization’s goals are as follows:

1. Survival: Any business’s primary goal is to remain in operation, and in order to do so, it must generate enough income to pay its bills.
2. Profit: It serves as a motivator or reward for an entrepreneur’s efforts. Additionally, it serves as the impetus for running a firm.
3. Growth: A company must grow and diversify its operations if it wants to improve its long-term prospects. Every company’s performance is determined by its growth rate, which is determined by factors like sales, earnings, the number of goods produced and sold, etc.

Social objectives: Since organizations are social constructs, their goals should be congruent with societal norms.

The following list includes a few of an organization’s social goals.

1. The availability of high-quality goods at fair pricing.
2. Making use of environmentally friendly production techniques.
3. Should give underprivileged groups in society a chance to find jobs.

Chapter 1 Class 12 Business Studies Important Questions

Chapter 1 class 12 business studies important questions are developed by subject experts at Extramarks so that students know the important questions that may come in their examination. These business studies class 12 chapter 1 important questions are made on the basis of the material given in the CBSE syllabus and the NCERT books as prescribed by the CBSE.  

Nature and Significance of Management

Management is the process of planning, creating, and sustaining a setting in which people collaborate effectively to achieve a common objective. It is the process of effectively and efficiently planning, organizing, implementing, and managing an organization’s operations and activities.

The traditional notion and the management concept are the two types of management.

Characteristics of Management

Here are some characteristics of management

• The process of management is goal-oriented.
• Management is all-pervasive.
• Management is multidimensional.
• The process of management is continuous.
• Management is a group activity.
• Management has a dynamic function.
• It is an intangible force.

Objectives of Management

• Organizational Objectives: Management is supposed to strive toward achieving objectives in a way that benefits all stakeholders.
• Social Objectives: An organization’s social commitment is addressed through its social objectives.
• Personal Goals: Personal goals relate to an employee’s ability to meet their own needs.

Importance of Management

1. By properly directing everyone’s activities, management aids in the achievement of collective objectives.
2. Efficiency is increased by management through making the best use of all resources, including labour, funds, and materials.
3. By assisting employees in adapting to these changes, management builds a dynamic organization that can keep its competitive edge.
4. Through leadership, motivational factors such as a decent wage, peer recognition, profit sharing, etc., and the accomplishment of organizational goals, management aids in the achievement of personal goals.
5. The establishment of schools, hospitals, and crèches, as well as the provision of jobs and high-quality goods at affordable prices, all, contribute to the social development of management.

Nature of Management

A profession, science, or art can all be used to characterize management. It is regarded as an art since it involves a personalized process in which a person skilfully and individually uses the knowledge he or she has learned.

Management can be compared to science because it has a systematized body of knowledge made up of theories, principles, and concepts. It involves looking into how people act.

Management can also be seen as a profession because it has a clearly defined body of knowledge. Experiments are used to derive their own principles.

Levels of Management

A hierarchy of administrative positions running the length of an organization is known as levels of management. In any corporation, three level of management exists, which are as follows:

The board of directors, CEO, chief operating officers, and many more individuals make up top-level management. People at this level create the policies necessary to accomplish management goals.

Divisional chiefs, department heads, officers, and financial managers make up the middle level of management. Managers and heads are in charge of carrying out and overseeing the organization’s plans and strategies at this level.

The operational level of management, which consists of superintendents, clerks, supervisors, etc., is the lowest level of management. They are in charge of both technical and everyday activities.

Functions of Management

Management is the process of organizing, staffing, directing, and managing the actions of each person and resource in order to accomplish certain objectives.

• Planning is the process of planning and making decisions on what must be done in advance to achieve the goal.
• Organizing refers to the process of allocating tasks and responsibilities. In order to carry out a given strategy, organizing entails establishing authority and distributing resources.
• Staffing is the process of placing people in the appropriate roles in accordance with the demands of the job.
• Directing is the process that entails persuading, advising, directing, managing, and encouraging others to attain particular goals.
• Controlling is the process of making sure the company is moving on the right path. This procedure makes sure that the established standards are followed.

Meaning, Characteristics and Importance of Coordination

Because it is the procedure that ensures that harmony in the company is established, coordination is the essence of management. All individuals’ attempts to achieve goals are coordinated through this method. All three levels in an organization need coordination.

Characteristics of Coordination

Here are some characteristics of coordination.

• Integrates team work: To unite everyone’s efforts in the direction of a single objective, coordination is required.
• Unity of action is ensured: For the organization’s members to be united, coordination is necessary.
• Continuous process: Coordination is necessary at every stage and in every economic activity. As a result, it is an ongoing process.
• Pervasive: Because it is required at all levels, coordination is everywhere. It can be used in political, social, legal, and economic types of organizations.
• Deliberate function: The managers purposefully designed this approach to coordinate everyone’s activities.
• Manager’s responsibility: Coordination is the responsibility of every manager at every level of an organization.

Importance of Coordination

Because it combines individual efforts for an organization’s successful and efficient operation, coordination is crucial.

Coordination is crucial in a huge organization where people come from various backgrounds and have varying interests, ways of thinking, and comprehension. Consequently, something must tie them together.

Because an organization’s functions are divided across many departments, each of which has its own goals, plans, and policies, coordination is crucial. Therefore, it’s crucial to stay away from all conflicts.

For the organization’s professionals to function in unison, coordination is crucial.

Advantages of Using Extramarks Important Questions

When you read these class 12 business studies chapter 1 important questions, you gain an idea of the important question that may appear in your exams. In addition, the question mentioned in these CBSE revision notes is on the basis of the prescribed CBSE syllabus and NCERT books. 

After going through important questions for Class 12 Business Studies chapter 1, you will be able to solve CBSE past years’ question papers as well as CBSE sample papers.