104-BUSINESS ORGANISATION AND MANAGEMENT(1YEAR B.

COM)

1. What do you mean by theory X

Ans) An average employee intrinsically does not like work and tries to escape it whenever possible.
 Since the employee does not want to work, he must be persuaded, compelled, or warned with
punishment so as to achieve organizational goals. A close supervision is required on part of
managers. The managers adopt a more dictatorial style.
 Many employees rank job security on top, and they have little or no aspiration/ ambition.
 Employees generally dislike responsibilities.
 Employees resist change.
 An average employee needs formal direction.
2. articles of association
Ans) In corporate governance, a company's articles of association (AoA, called articles of incorporation in
some jurisdictions) is a document which, along with the memorandum of association (in cases where
the memorandum exists) form the company's constitution, defines the responsibilities of the directors, the
kind of business to be undertaken, and the means by which the shareholders exert control over the board of
directors.

3. Contents of Articles of Association

The articles generally deal with the following

1. Classes of shares, their values and the rights attached to each of them.
2. Calls on shares, transfer of shares, forfeiture, and conversion of shares and alteration of capital.
3. Directors, their appointment, powers, duties etc.
4. Meetings and minutes, notices etc.
5. Accounts and Audit
6. Appointment of and remuneration to Auditors.
7. Voting, poll, proxy etc.
8. Dividends and Reserves
9. Procedure for winding up.
10. Borrowing powers of Board of Directors and managers etc.
11. Minimum subscription.
12. Rules regarding use and custody of common seal.
13. Rules and regulations regarding conversion of fully paid shares into stock.
14. Lien on shares.

Page 1 of 11
4. partnership deed
Ans) A partnership deed, also known as a partnership agreement, is a document that outlines in detail the
rights and responsibilities of all parties to a business operation. It has the force of law and is designed to
guide the partners in the conduct of the business. It is helpful in preventing disputes and disagreements over
the role of each partner in the business and the benefits which are due to them.
The deed gives important financial details of the partnership, such as the amount of capital to be invested by
each partner, the ownership shares that each partner is entitled to through this investment, the salaries to be
paid to each partner and the method of distributing the business income.

a HUF

 Formation: To begin a Hindu Undivided Family there must be a minimum of two related family
members. There must be some assets, business or ancestral property that they have inherited or will
eventually inherit. The formation of a HUF does not require any documentation and admission of new
members is by birth.

 Liability: The liability of all the various co-parceners is only up to their share of the property or business.
So they have limited liability. But the Karta being the head of the HUF has unlimited liability.

 Control: The entire control of the entity lies with the Karta. He may choose to confer with the co-
parceners about various decisions, but his decision can be independent. is actions will be final and also
legally binding.

6. What is directing
Ans) Directing is said to be a process in which the managers instruct, guide and oversee the performance of
the workers to achieve predetermined goals. Directing is said to be the heart of management process.
Planning, organizing, staffing have got no importance if direction function does not take
place. Directing initiates action and it is from here actual work starts. Direction is said to be consisting of
human factors. In simple words, it can be described as providing guidance to workers is doing work. In field
Of management, direction is said to be all those activities which are designed to encourage the subordinates
to work effectively and efficiently

7. What do you mean by theory Y

 Ans) Employees can perceive their job as relaxing and normal. They exercise their physical and
mental efforts in an inherent manner in their jobs.
 Employees may not require only threat, external control and coercion to work, but they can use self-
direction and self-control if they are dedicated and sincere to achieve the organizational objectives.

Page 2 of 11
  If the job is rewarding and satisfying, then it will result in employees’ loyalty and commitment to
organization.
 An average employee can learn to admit and recognize the responsibility. In fact, he can even learn
to obtain responsibility.
 The employees have skills and capabilities. Their logical capabilities should be fully utilized. In
other words, the creativity, resourcefulness and innovative potentiality of the employees can be
utilized to solve organizational problems.

8. The difference between public and private company can be drawn clearly on the following grounds:

1. The public company refers to a company that is listed on a recognised stock exchange and traded
publicly. A Private Ltd. the company is one that is not listed on a stock exchange and is held
privately by the members.

2. There must be at least seven members to start a public company. As against this, the private
company can be started with minimum two members.

3. The is no ceiling on the maximum number of members in a public company. Conversely, a private
company can have a maximum of 200 members, subject to certain conditions.

4. A public company should have at least three directors whereas the Private Ltd. company can have a
minimum of 2 directors.

5. It is compulsory to call a statutory general meeting of members, in the case of a public company,
whereas there is no such compulsion in the case of a private company.

6. In a Public Ltd. Company, there must be at least five members, personally present at the Annual
General Meeting (AGM) for constituting the requisite quorum. On the other hand, in the case of a
Private Ltd. Company, that number is 2.

7. The issue of prospectus/statement instead of the prospectus is mandatory in case of a public

company, but this is not the case with the private company.

8. To start a business, the public company needs a certificate of commencement of business after it is
incorporated. In contrast, a private company can start its business just after receiving a certificate of
incorporation.

9. The transferability of shares of a Pvt. Ltd. company is completely restricted. On the contrary, the
shareholders of a public company can freely transfer their shares.

10. A public company can invite the general public for subscribing shares of the company. As opposed, a
private company has no right to invite public for subscription.

Page 3 of 11
9. private limited company
Ans) A private limited company is a company which is privately held for small businesses. The liability of
the members of a Private Limited Company is limited to the amount of shares respectively held by
them.Shares of Private Limited Company cannot be publically traded. Alll the aspects of Private Limited
Company is discussed in the article.
10. motivation
Ans) Motivation is the reason for people's actions, desires, and needs. Motivation is also one's direction to
behavior, or what causes a person to want to repeat a behavior. A motive is what prompts the person to act
in a certain way, or at least develop an inclination for specific behavior.
According to Maehr and Meyer, "Motivation is a word that is part of the popular culture as few other
psychological concepts are."[
11. Approaches to Management by Scientific School and Administrative School of Thought!

This school of thought is actually divided into two different approaches—the scientific school and the
administrative school. These theorists laid certain principles for managing an organization. Exhibit 2.1
highlights their contributions in a nutshell.

Classical thoughts
Scientific School
Frederick W. Taylor – Development of scientific management
Frank B. and Lilian M. Gibreth – Time and motion studies
Henry L. Gantt – The Gantt chart
Administrative School
Henry Fayol – General theory of management
Max Weber – Rules
Scientific Management:
This is the most pioneering classical approach, and it places emphasis on the scientific study of work
methods to improve efficiency of the workers. Among all the contributors to this school of thought, we
consider the contribution of F.W. Taylor as the most important. By developing specific principles of
scientific management in 1911, he became the father of scientific management.

He identified that workers indulge in soldering primarily for the following three reasons:
1. Fear of losing jobs if they increase their output
2. Faulty wage systems
3. Out-dated methods of working

Page 4 of 11
12. liberalization
Ans) Liberalization (or liberalisation) of the economy means to free it from direct or physical controls
imposed by the government. This may be similar to deregulation.Liberalization of autocratic regimes may
precede democratization
Economic liberalization is often associated with privatization, which is the process of transferring ownership
or outsourcing of a business, enterprise, agency, public service or public property from the public sector to
the private sector.

13. 8 Most Important Features of Human Resource Management

Article shared by <="" div="" style="margin: 0px; padding: 0px; border: 0px; outline: 0px; font-size: 16px;
vertical-align: bottom; background: transparent; max-width: 100%;">
On the analysis of definitions of human resource management, the following features of HRM can be
identified:
Features
1. People Oriented:
Human resource management is concerned with employees both as individuals and as a group in attaining
goals.
It is also concerned with behaviour, emotional and social aspects of personnel. It is the process of bringing
people and organisations together so that the goals of each are met.
2. Comprehensive Function:
Human resource management covers all levels and categories of employees. It applies to workers,
supervisors, officers, managers and other types of personnel
3. Individual Oriented:
Under human resource management, every employee is considered as an individual so as to provide services
and programmes to facilitate employee satisfaction and growth.
In other words, it is concerned with the development of human resources, i.e., knowledge, capability, skill,
potentialities and attaining and achieving employee goals.
4. Continuous Function:
Human resource management is a continuous and never ending process. According to George R Terry, “it
cannot be turned on and off like water from a faucet; it cannot be practiced only one hour each day or one
day each week.
Personnel management requires a constant alertness and awareness of human relations and their importance
in everyday operations”.
5. A Staff Function:
Human resource management is a responsibility of all line managers and a function of staff managers in an
organization.
Page 5 of 11
Human resource managers do not manufacture or sell goods but they do contribute to the success and
growth of an organisation by advising the operating departments on personnel matters.
6. Pervasive Function:
Human resource management is the central sub-function of an organisation and it permeates all types of
functional management viz., production management, marketing management and financial management.
Each and every manager is involved with human resource function. It is a responsibility of all line managers
and a function of staff managers in an organisation.
7. Challenging Function:
Managing of human resources is a challenging job due to the dynamic nature of people. Human resource
management aims at securing unreserved co-operation from all employees in order to attain pre-determined
goals.
8. Development Oriented:
Individual employee-goals consist of job satisfaction, job-security, high salary, attractive fringe benefits,
challenging work, pride, status, recognition, opportunity for development etc.

14. joint stock

Ans) A joint-stock company is a business entity in which shares of the company's stock can be bought and
sold by shareholders. Each shareholder owns company stock in proportion, evidenced by
their shares (certificates of ownership). That allows for the unequal ownership of a business with some
shareholders owning more of a company than others. Shareholders are able to transfer their shares to others
without any effects to the continued existence of the company
15. business
Ans) A business (also known as an enterprise, a company, or a firm) is an organizational entity and legal
entity made up of an associationof people, be they natural, legal, or a mixture of both who share a common
purpose and unite in order to focus their various talents and organize their collectively
available skills or resources to achieve specific declared goals and are involved in the provision
of goods and services to consumers.

16. Types of Plan

Planning is a pervasive function of management, it is extensive in its scope. So all managers across all levels
participate in planning. However, the plans made by the top level manager will differ from the ones that lower
managers make.
Plans also differ from what they seek to achieve and what methods will be used to achieve them. So let us look
at the types of plans that managers deal with.

Page 6 of 11
 Objectives

This is the first step in planning the action plan of the organization. Objectives are the basics of every company
and the desired objective/result that the company plans on achieving, so they are the endpoint of every planning
activity.
For example one of the objectives of an organization could be to increase sales by 20%. So the manager will
plan all activities of the organization with this end objective in mind. While framing the objectives of the
organization some points should be kept in mind.
 Objectives should be framed for a single activity in mind.
 They should be result oriented. The objective must not frame any actions
 Objectives should not be vague, they should be quantitative and measurable.
 They should not be unrealistic. Objectives must be achievable.

Strategy
This obviously is the next type of plan, the next step that follows objectives. A strategy is a complete and all-
inclusive plan for achieving said objectives. A strategy is a plan that has three specific dimensions
i. Establishing long-term objectives
ii. Selecting a specific course of action
iii. allocating the necessary resources needed for the plan
Forming strategy is generally reserved for the top level of management. It actually defines all future decisions
and the company’s long-term scope and general direction.

Policy

Policies are generic statements, which are basically a guide to channelize energies towards a particular strategy.
It is an organization’s general way of understanding, interpreting and implementing strategies. Like for
example, most companies have a return policy or recruitment policy or pricing policy etc.

Procedure

Procedures are the next types of plan. They are a stepwise guide for the routine to carry out the activities. These
stepwise sequences are to be followed by all the employees so the activities can be fulfilled in an organized
manner.

The procedures are described in a chronological order. So when the employees follow the instructions in the
order and completely, the success of the activity is pretty much guaranteed.

Page 7 of 11
Rules

Rules are very specific statements that define an action or non-action. Also, rules allow for no flexibility at all,
they are final. All employees of the organization must compulsorily follow and implement the rules. Not
following rules can have severe consequences.

Program

Programmes are an in-depth statement that outlines a company’s policies, rules, objectives, procedures etc.
These programmes are important in the implementation of all types of plan. They create a link between the
company’s objectives, procedures and rules.

Methods

Methods prescribe the ways in which in which specific tasks of a procedure must be performed. Also, methods
are very specific and detailed instructions on how the employees must perform every task of the planned
procedure. So managers form methods to formalize routine jobs.

Methods are very important types of plan for an organization. They help in the following ways

 give clear instructions to the employees, removes any confusion

 Ensures uniformity in the actions of the employees

 Standardizes the routine jobs

 Acts as an overall guide for the employees and the managers

Budget

A budget is a statement of expected results the managers expect from the company. Budgets are also a
quantitative statement, so they are expressed in numerical terms. A budget quantifies the forecast or future of
the organization.

17. staffing
Ans) Staffing is the function of employee recruitment, screening and selection performed within an
organization or business to fill job openings. Other areas of employment which may be handled by a staffing
department are orientation, training, retention and termination. This function is sometimes handled outside
of an organization by using contractors at various levels of the staffing process. Small organizations may
handle staffing on a case-by-case basis, while larger organizations may go through multiple staffing cycles
Page 8 of 11
during a single year. Organizations of any size may use staffing to acquire temporary or permanent
employees. Some related terms and departments include human resources, personnel management and
hiring.

18. features of controlling

Ans) (1) Controlling is a Fundamental Management Function:
There are many functions of management like planning, organizing, staffing, directing and controlling.
(2) Essential Function of Every Manager:
The controlling is a pervasive function of management as it is performed in all organisations (business and
non-business) and at all the managerial levels
(3) Controlling is a Continuous Activity:
Control does not mean any activity which is performed only for once or is repeated after a long interval but
it is needed at all times. Under controlling, the progress has to be assessed continuously.
(4) Controlling is Both the Beginning and the End of the Process of Management:
The need of control is felt both at the beginning and end of the process of management.
(5) Controlling is related to Results:
Control is related to results because we assess progress on the basis of results and take corrective action after
finding out the deviations.

19. IDBI
Ans) IDBI Bank was established in 1964 by an Act of Parliament to provide credit and other financial
facilities for the development of the fledgling Indian industry.Central government is the owner of this bank
and employees will be called as Central Govt staffs.It is one among the public sector banks in india and is a
nationalized bank to be treated on par with SBI and other Nationalized banks with reference to the
notification dated 26th February 2013 by finmin. At present Govt holds 77% stake in IDBI Bank, has
reported yet another surge in bad loans in the April-June quarter. The lender now has the highest proportion
of bad loans, with nearly a quarter of its book having turned bad.
20. prospectus
Ans) A prospectus is a formal legal document that is required by and filed with the Securities and Exchange
Commission that provides details about an investment offering for sale to the public. The preliminary
prospectus is the first offering document provided by a security issuer and includes most of the details of the
business and transaction in question; the final prospectus, containing finalized background information
including such details as the exact number of shares/certificates issued and the precise offering price, is
printed after the deal has been made effective. In the case of mutual funds, a fund prospectus contains details
on its objectives, investment strategies, risks, performance, distribution policy, fees and expenses, and fund
management.
Page 9 of 11
21. Total quality management
Ans) Total Quality Management (TQM) describes a management approach to long-term success through
customer satisfaction. In a TQM effort, all members of an organization participate in improving processes,
products, services, and the culture in which they work.
Total Quality Management Principles: The 8 Primary Elements of TQM
Total quality management can be summarized as a management system for a customer-focused organization
that involves all employees in continual improvement. It uses strategy, data, and effective communications
to integrate the quality discipline into the culture and activities of the organization

22.stock exchange
Ans) A stock exchange is an exchange (or bourse)[note 1]
where stock brokers and traders can buy and
sell shares of stock, bonds, and other securities. Stock exchanges may also provide facilities for issue and
redemption of securities and other financial instruments and capital events including the payment of income
and dividends. Securities traded on a stock exchange include stock issued by listed companies, unit
trusts, derivatives, pooled investment products and bonds. Stock exchanges often function as "continuous
auction" markets with buyers and sellers consummating transactions at a central location such as the floor of
the exchange
23.marketing channels
Ans) A marketing channel is the people, organizations, and activities necessary to transfer the ownership
of goods from the point of production to the point of consumption. It is the way products and services get to
the end-user, the consumer; and is also known as a distribution channel. A marketing channel is a useful tool
for management,[2] and is crucial to creating an effective and well-planned marketing strategy. Another less
known form of the marketing channel is the Dual Distribution] channel. This channel is a less traditional
form that allows the manufacturer or wholesalerto reach the end-user by using more than one distribution
channel. The producer can simultaneously reach the consumer through a direct market, such as a website, or
sell to another company or retailer that will reach the consumer through another channel, i.e., a store. An
example of this type of channel would be franchising.

24.features of cooperatives
Ans) 1. Voluntary Organisation:
Cooperative organisation is a voluntary association of persons desirous of pursuing a common objective.
They can come and leave the organisation at their own will without any coercion or intimidation.

2. Democratic Management:
The management of a cooperative organisation is vested in the hands of the managing committee elected by
the members on the basis of ‘one member-one vote’ irrespective of the number of shares held by any

Page 10 of 11
member. The general body of the members lays down the broad framework within which the managing
committee has to function. Democracy is, thus, the keynote of the management of a co-operative society.

3. Service Motive:
One basic feature which distinguishes a cooperative organisation from other three forms of business
ownership is that the primary objective of a co-operative society is to render services to its members rather
than to earn profits.

4. Capital and Return Thereon:

The capital is procured from its members in the form of share capital. A member can subscribe subject to a
maximum of 10% of the total share capital or Rs. 1,000 whichever is higher. Shares cannot be transferred
but surrendered to the organisation. The rate of dividends paid to the members/ shareholders is restricted to
9% as per the Cooperative Societies Act, 1912.

Page 11 of 11