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AOM -1

Office Organisation and Management

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1. What do you understand by vertical filing? Outline the merits and demerits of vertical filing. (20)

SOLUTION

Vertical filing indicates the vertical position of the files. The files are kept in a standing position under this
method. Vertical filing method is developed to overcome the difficulties of horizontal filing. In large scale
organization, more papers are filed and there is a need of referring many papers. Hence, there is a possibility
of time consuming in locating the papers. Time is valuable. The desired file should be referred without much
difficulty but in lesser time. Usually, drawers or cabinets are used so that any folder may be withdrawn or
replaced without disturbing the other folder.

The invention of the vertical file remains an unsolved mystery. The Vertical Filing Cabinet section in the Early
Office Museum website begins with a discussion of the erroneous conclusions by highly credentialed
“secondary sources,” concerning the origin of vertical filing. The secondary sources claimed that a gold medal
was presented at the World’s Fair of 1893 for a vertical file. The Early Office Museum found no evidence to
substantiate those claims. However, the information presented in the Early Office Museum’s discussion of
vertical filing cabinets suggests that the commercial introduction of vertical filing may have occurred in 1900
when a company named the Library Bureau (founded in 1876, later a division of Remington Rand) published a
catalog that included a vertical filing cabinet. A US patent was filed in 1902 by the Library Bureau that credited
David E. Hunter as the inventor.

Advantages of Vertical Filing

The vertical method of filing offers the following advantages.

1. The files can be easily referred without much difficulty.

2. There is no disturbing of other papers or letters than desired.
3. Insertion or withdrawal of any papers or letters is done without much wastage of time and effort.

4. The cost of folders is very cheap. Hence, the cost of maintenance is very less.

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5. Nearly 1,000 folders can be accommodated in a single cabinet with four drawers.

6. Minimum space is required for keeping vertical filing.

7. There is much scope for the expansion of filing facility.
8. The drawers are locked after referring the desired files. Hence, the safety and security of file are ensured.
9. Fire proof cabinets are used to protect the files.
10. Vertical filing has much flexibility. The folders can be arranged in any kind of classification – alphabetically,
numerically, subject wise and so on.
11. This system can be applied to file all types of papers and documents, orders, invoices, quotations, tenders,
circulars etc. are to be filed without much difficulty.

Disadvantages of Vertical Filing

Vertical filing suffers from the following limitations.

1. The location of desired files requires much time.

2. The files may be wear and tear resulting from the slip down of folders.

2. What is a ‘Franking machine’? Briefly explain its working and advantages. (20)

SOLUTION A franking machine is a simple and cost effective way for businesses to handle their own post.

A franking machine allows businesses to accurately weigh their own mail and frank the item of postage. It’s an
easy way to pay for and handle your own postage.

To frank mail means to pay for it. So a franking mark is an equivalent to a stamp.

Simply frank the post (add the payment mark) in the office and then post it in a business post box. Post boxes
for franked mail are situated near business zones such as in city centres and on business parks and trading
estates.

Users add credit to their franking machine once a month or as required and post can then have the relevant
postage cost added to it in house without having to go to the post office.

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Franking machines are easy to use and come in various sizes. Some are little more than the footprint size of an
A4 piece of paper so will sit happily on an office desk.

The entry level machines require a member of staff to feed post into them. But larger franking machines can
be set up to automatically frank large runs of post such as invoices or mail shots.

There are several options for businesses that want to use a franking machine. They can be rented for an
annual or monthly fee or bought out right. Sometimes businesses can trial a refurbished franking machine
before committing to renting or buying.

But once businesses have experienced the savings they rarely go back.

Businesses that post more than 8 second class letters a day can make decent savings by using a franking
machine. Companies that send out more letters and parcels than this can make substantial savings.

And it isn’t just an option for SME’s and corporates. More and more we’re seeing one man companies such as
eBay entrepreneurs using franking machines.

Benefits of Using a Franking Machine

1. Postal Discounts from the Royal Mail

In the last two years the Royal Mail has dramatically increased the discounts on franked mail. This is because,
for the Royal Mail, handling franked items is a lot cheaper than issuing stamps and processing stamped mail.

In order to encourage more businesses to use franking machines, the Royal Mail offers big discounts on postal
charges for customers who frank their post...so everyone's a winner! In some cases franking discounts have
doubled in the last two years and this means even for a company that sends out quite small volumes of mail,
buying or renting a franking machine can help to cut down on mailroom costs.

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2. Presenting a professional image

Sending franked mail presents a professional image to your business partners and customers.
Your franked stamp can be customized for your business and can contain your company logo and promotional
text or other business messages.

They say there is no such thing as a free lunch, but franking your mail gives you the opportunity to advertise
your company...for free. You can advertise new services, promotions and new offers. Using a franking machine
that offers text messaging, you can even change the message on a daily basis.

3. Over Stamping

Most people end up doing this at some point. You have something that needs to be posted, but you are
unsure of the weight, or don't have the correct value of stamps so you over pay. It is a waste of money, but at
least the job is done.

With a franking machine, especially one with an integral scale, this is never a problem. You get the correct
postage, dial it in to the machine and frank it. Job done and rather than over pay you are getting discounted
postage!

4. Under Stamping

The Royal Mail used to charge the sender if postal items were under stamped. Now the Royal Mail will deliver
the item to the recipient's receiving office and ask the recipient to pick up the item and pay the difference plus
a handling fee.

If a company accidentally under stamps mail, it causes inconvenience to its customers and also costs them
money...not good news.

With a franking machine, it is easy to get the correct postage every time and avoid the embarrassment of
under stamping.

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5. Time Saving and Convenience

Murphy's Law - Stamps will run out at the most inconvenient time, this is just the way it is.
Trips to the post office for more stamps are not only time consuming but also inconvenient.

Franking machines can be topped up on-line* 24 hours a day, 7 days a week and it only takes a minute. Even
when the post office is shut you will never run out of postage.
Also processing out-going mail becomes less of an odious task. Mail items can be easily weighed and correct
postage applied. Batches of letters can be quickly passed through the franking machine and on their way.

When buying or renting a franking machine, it is worth checking on top-up charges and whether this involves a
premium rate number. Some franking companies hide these charges.

6. Accountability and Recording Expenditure

At tax return time franking machines are very useful. They report on your postage costs so the company can
claim their full expenses on their tax return.

For companies wishing to keep track of postage across departments, then most franking machines allow for
multiple department accounts to be set up and reported on. This can help keep control of costs.

3. Differentiate between of the following:

(a) System software and Application software

SOLUTION

System software is that category of software, which manages all the resources of
computer, and is loaded in the beginning or booting of computer. These are
designed to make the computer easier to use. System software controls the
operation of input/output devices, memory and processor etc. Windows operating
system such as Windows 95, Windows 98, Windows 2000, Windows XP
Windows Vista etc, are some examples of system software. Some functions of system software are:

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 Used by the computer to accomplish a task.

• Manages all the resources of computer

• Create database and keeps it update after every transaction

• Arrangement of files in alphabetical order

• Controls the internal functions of computer

• Controls other devices connected to the CPU

System software can be further compared as a type of program that acts like a conductor
in an orchestra. It directs all the activities and sets all the rules for how the hardware
and software work together. MS DOS and Microsoft Windows are examples of system
software or operating system software.
Some System Software are inbuilt into the computer. Examples of such software can be
given as ROM chips. This software helps to setup the computer and start it.

Application Software

Although system software is essential for the running your computer and manage all the
resources of it. You need application software to enable the computer to solve a specific
data processing task such as payroll processing, inventory control, and insurance company
data. A software package is a group of programs for solving a specific task.
A number of powerful application software packages, which does not require
significant programming knowledge, have been developed. These are easy to learn and
use as compared to the programming languages. Software can be used by people to solve
general problems. It can be used to do more than one task such as:

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Planning

• Writing

• Record keeping

• Calculating

• Communicating

• Drawing

• Painting etc.

There is no limitation of activities can be done by this softwares.

What can be done with general purpose application software is only limited by the
imagination of the user. Use of variety of software depends upon the requirement of the
type such as letter typing, making presentation, making tables and storing data in a
databases. Some examples of such application software are:

1. Word Processing Package

2. Spreadsheet Package

3. Graphics Software, and

4. Database Management Software

(b) Commerce and E-commerce

SOLUTION

Commerce

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Commerce relates to "the exchange of goods and services, especially on a large scale." It includes legal,
economic, political, social, cultural and technological systems that operate in a country or in international
trade.

E-commerce

Electronic commerce or ecommerce is a term for any type of business, or commercial transaction, that
involves the transfer of information across the Internet. It covers a range of different types of businesses, from
consumer based retail sites, through auction or music sites, to business exchanges trading goods and services
between corporations. It is currently one of the most important aspects of the Internet to emerge.

Ecommerce allows consumers to electronically exchange goods and services with no barriers of time or
distance. Electronic commerce has expanded rapidly over the past five years and is predicted to continue at
this rate, or even accelerate. In the near future the boundaries between "conventional" and "electronic"
commerce will become increasingly blurred as more and more businesses move sections of their operations
onto the Internet.

Business to Business or B2B refers to electronic commerce between businesses rather than between a
business and a consumer. B2B businesses often deal with hundreds or even thousands of other businesses,
either as customers or suppliers. Carrying out these transactions electronically provides vast competitive
advantages over traditional methods. When implemented properly, ecommerce is often faster, cheaper and
more convenient than the traditional methods of bartering goods and services.

Electronic transactions have been around for quite some time in the form of Electronic Data Interchange or
EDI. EDI requires each supplier and customer to set up a dedicated data link (between them), where
ecommerce provides a cost-effective method for companies to set up multiple, ad-hoc links. Electronic
commerce has also led to the development of electronic marketplaces where suppliers and potential
customers are brought together to conduct mutually beneficial trade.

The road to creating a successful online store can be a difficult if unaware of ecommerce principles and what
ecommerce is supposed to do for your online business. Researching and understanding the guidelines
required to properly implement an e-business plan is a crucial part to becoming successful with online store
building.

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(c) Management and Administration

SOLUTION

Management

Business management is more than simply telling employees what to do. Managers must understand business
organization, finance, and communication, as well as have a thorough understanding of their particular market
and relevant technologies and policies. While managers are not necessarily the most important people in the
organization, their work is critical to helping everyone else work together seamlessly.

Administration

Administration refers to the process of running an organisation, office or business. This includes creating rules
& regulations, making descisions, management of operations, creating organisation of staff/employees/people
to direct activities towards achieving a common goal or objective.

Some of the basic functions of administration include

a. Planning

b. Organising

c. Directing

d. Controlling

(d) Horizontal Filing and Vertical Filing (4X5)

SOLUTION

Horizontal Filing

In horizontal Cling, documents are placed in a horizontal position, one on the top of another in order of date
and the latest document is kept on the top. The best example of horizontal filing is flat files and arch lever file.
Horizontal filing has the following advantages:

(a) This system of filing is simple and any one can understand this easily.

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(b) The papers are kept in order in which they have been filed and these letters are punched and put through
a metal hinge so that it cannot be misplaced.

(c) This system facilitates speedy reference of letters because here letters are placed according to dates of
receipts.

(d) This system requires less space because the files are kept one over the other.

(e) This method is economical to operate.

Vertical Filing

Files and folders contain important sources of organizational information. Filing information is a way of
organizing it to enable easy and prompt retrieval whenever needed. An effective filing system is basic to
organizing files and folders in an efficient manner. The vertical filing system has many inherent advantages,
including less space consumption, easier organization and accommodation for variant filing systems. A vertical
filing system may just be the one your office needs.

4. Briefly comment of the following:

(a) By storing the information in the computer, paper work in the offices may be reduced.

SOLUTION One solution that is growing in popularity is digital conversion or creating an electronic database
to store your files. At ScansAmerica, we have been helping companies transition into a more paperless
workflow for more than 18 years, so we have seen firsthand how the following nine benefits relieve stress and
enhance the productivity of businesses who decide to take the paperless plunge.

Some of the benefits of a paperless office listed below will be evident to you right from the moment you
digitize your files, while you'll enjoy others more and more as time goes on.

Benefit 1: Freed-Up Office Space

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While we realize you may still have some documents here or there that need to stay in physical paper form,
most of the items in our filing cabinets can serve us just as well in digital form. How often do we file
documents, only to never access them except when we shred them a few years later? Don't let records like
these consume your valuable office space.

One of the top reasons to go paperless in the office is to minimize the office space your documents hoard.
Transition to storing company files in a cloud-based system or on a private company server to give yourself the
gift of extra space. Doing so will add value to the time you spend at the office.

Imagine what business-growing activities you can accomplish once you free yourself from those bulky filing
cabinets, boxes and even the industrial-sized printer you had to invest in. You might be able to convert the old
archive room into a shared space for colleagues to socialize, or maybe you can bring in extra furniture to add
comfort and style to your office aesthetic. What you do with this new space is up to you, and there are
countless possibilities, most of which are far more exciting than paper storage.

Benefit 2: Financial Savings for Everyone

All that paper doesn't just consume space, but your funds, as well. Copier paper costs alone can take up a
hefty chunk of any budget, not to mention the expenses for printer toner and copy machine maintenance or
the snowballing investment your company regularly makes in staples, paperclips, file folders, lamination,
labels and other paper-organizing office supplies.

Now, imagine you didn't have to pay for any of these items anymore. Imagine no longer contributing to the $8
billion companies spend on paper managementevery year. Imagine being able to redirect these funds to grow
your client base, revamp your sales strategies or hire those key employees you've been coveting. You'll be able
to see paper costs dwindle, and you'll see your digital conversion pay for itself within a few months.

Benefit 3: Instant Access to Documents

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We have all witnessed the perks of continually having the Internet at our fingertips. Storing your office files
electronically makes your workflow much more time-efficient because of the quick access you have to your
documents. Tags and other metadata make your documents searchable using keywords. Here at
ScansAmerica, we create a full index of these electronic tags for you as part of our 12-step digital conversion
process, so you'll be able to find any document you are looking for with ease.
Not only will you no longer have to get up and sort through filing cabinet folders to find your necessary
paperwork, but you also won't have to make copies of it or scan or fax the document yourself to share
information with co-workers or clients. Instead, you'll be able to access and attach files to emails, pull them up
on your screen in presentations and share viewing and editing capabilities with key employees.

Benefit 4: Ease of Working Remotely

With a digital system, your employees will no longer have to carry around folders full of paperwork to give
their presentations and meet with clients. In fact, they'll be able to take the much more convenient and
modern approach of operating through PDF files and emails.

If it suits your business style, this can free up your key workers to operate remotely, as they would no longer
be required to be physically present at the office to fill out forms and input data. Those with the right
authorization will be able to access your cloud drive from anywhere at any time, thanks to the growing use of
laptops and portable tablets. You may even see your sales team checking off those prospects using nothing
more than their smartphones.

Employees thrive on that kind of trust, and you may see it leading to new creative pursuits and growth in all
sorts of areas of your business.

Benefit 5: Paper Trail to Limit Audit Risk

With paper files, you never know who might leave confidential files lying around or stored incorrectly, leaving
sensitive information in the wrong hands. For security purposes, a digital storage system can protect and track

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all activity on the files, so you will always be able to see if anyone has accessed the paperwork or made any
changes.

One of the most significant security benefits of going paperless for your business is that you and your staff will
be able to pull up key documents at a moment's notice. You can have greater peace of mind by knowing
everything is in its proper place.

Benefit 6: Files Protected Against Age and Disaster

Similarly, fires, storms and break-ins can limit the amount of security you can ensure with paper documents.
All it takes is an accident or an unforeseen disaster, and all your files may be in jeopardy. Among the
advantages of a paperless office is a digital lockbox where all your files reside. Even if your computer hardware
were to suffer damage, your cloud storage would be free from harm.

When disaster strikes, you don't want your files to be your main concern. Instead, you'll be able to focus on
helping your employees recover and getting your business up and running, which will be much easier to do
with all of your documents securely locked away.

Benefit 7: Improved Collaborative Capabilities

With officemates and customers alike, working together on projects is much more efficient with access to
digital copies of important documents. In a paperless business, you'll no longer have to run to the copier to be
able to share files, nor will you run into the problem of only one person being able to access the file at a time.
Employees would even be able to work on projects together from remote locations, such as the coffee shop
next door, while having access to any files they may need. These kinds of freedoms will make them pleased
with your digital conversion.

Your clientele will also see a greater appeal in your services, thanks to the paperless nature of your business.
Imagine no longer spending company dollars on postage to send forms and contracts to your clients. The
instant communication capabilities through email and cloud sharing will thrill your clients and make them
realize the advantages of doing business with you. They will see the benefit of having a digital copy

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themselves, and while they may print it out and file it in their physical systems, they will be grateful for the
time savings your quick response allows.

Benefit 8: Reduce Future Environmental Impact

More and more companies see the environmental, tree-saving effects of going digital wherever possible. To
some, the importance of a paperless office is not only about the business and workflow advantages, but also
about being considerate of the world at large and eliminating as much consumption and waste as possible.

Businesses in the U.S. alone use more than 12 trillion sheets of paper a year, and paper accounts for one-
fourth of all landfill waste. These numbers are concerning, and creating a digital storage system for your
paperwork can help your business become an environmentally conscious trendsetter.
This benefit can also be a perk for your branding. Consumers see the benefits of paperless offices, and they
are increasingly interested in sustainability, looking to purchase products and services from brands they
believe are doing their part.

Benefit 9: Happier Employees and Improved Office Morale

With regular paper storage methods, not only does there never seem to be enough space or money, but
managing documents costs your workforce valuable productivity minutes. Paper records sometimes even
increase office tension when documents get lost, misfiled or damaged accidentally. While these soft costs may
not be initially visible when looking at the overall success of your business, the atmosphere of the office reaps
their draining effect.

Fortunately, built-in document access and security measures minimize these issues. Through these benefits,
not only does your business have the chance to skyrocket, but your employees will be happier and feel more
productive, boosting overall office morale. Customers are more satisfied with their service, leading to proud
employees. Ease and increased productivity have an empowering effect, and for many, the idea of working for
a company that values the environment and takes steps to reduce their carbon footprint is reason alone to be
proud of their wosrk.

(b) Centralized filing ensures more efficient office service than departmental filing.

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SOLUTION

The records of all the departments of the business organization are maintained at one place i.e. centralized
filing system. The centralized filing records are controlled by a common index plan. For which, a separate
department is created i.e. known as filing department. All the files of the organization are preserved by this
department. The functional departments of an organization are relieved from the headache of maintaining
records. All files, filing equipment and filing staff are located in the filing department.

Advantages of Centralized Filing

The main advantages of centralized filing are as follows.

1. There is no duplication of filing arrangements. Therefore, cost of filing maintenance is very low.

2. There is better utilization of storage space.

3. Easy location of documents and records are possible. It saves time and human resources.

4. There is full utilization of storage space available.

5. Duplication of filling equipment is avoided at the maximum and required only few filing cabinets.

6. It enables uniformity and standardization of the filing system and method.

7. It ensures easy location and delivery of required documents.

8. This system utilizes trained and qualified staff which leads to greater accuracy in the filing of records.

9. This system ensures greater oustput and efficient operation of every work throughout the office.

10. Supervision and control can be employed in a better way on transfer of records, their retrieval and
retention.

(c) Index can serve as a complete record of customers and suppliers.

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SOLUTION

1. Alphabetically arranged list of items (such as names or terms) given at the end of a printed text with page
numbers on which the item can be found.
2. Statistical device which summarizes a collection of data (usually related to the price or quantity of a 'basket'
of goods and services) in a single base figure. This composite figure serves as a benchmark for measuring
changes in the price or quantity data over a period (month, quarter, year). Usually, the base is assigned an
arbitrary value of 100 and all subsequent data is expressed in relation to this base. For example, the consumer
price index (CPI) of a year might stand at 95 (to indicate a fall of 5 percent in the prices) or 105 (to indicate an
increase of 5 percent in the prices).

(d) All office activities are of routine nature. (4X5)

SOLUTION

Collecting, processing, storing and distributing information are the basic functions of an office. These basic
functions are the essential features of any office and have to be performed by every office. The Companies Act
also provides that every company should maintain certain registers and books as а part of fulfillment of the
legal requirements.

These basic functions, in а sense, are the legal requirements to certain forms of organization. However, for
other forms of organization also these primary functions are essential for the successful conduct of their
business. Besides, they must be done in time.

Тhе basic function is classified by G.Mills and О.Standingford into five sub-functions, which are as follows:

1. Receiving Information.
2. Recording Information.
3. Arranging Information.
4. Giving Information.

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5. Safeguarding Assets.

5. .Write short notes on any four of the following:

(a) Pension and Retirement Benefits

SOLUTION

Retirement and pension benefits are provided to retired government officials to ensure a regular income and
a secure future. The provision of such financial benefits results in a feeling of independence and a decent
standard of life. As far as retirement benefits are concerned, they usually consist of leave encashment,
retirement gratuity and contributed provident fund.

Along with these retirement benefits, senior citizens are also entitled to pension benefits that allow them to
live a hassle free life after completion of their job tenure. Different types of pension available to senior citizens
are superannuation, retiring pension, voluntary retirement pension, compensation pension, compassionate
allowance, extraordinary pension and family pension.

Superannuation pension is meant for those government officials who retire at the age of 60 years. Voluntary
pension is awarded to those who wish to retire three months in advance after completing 20 years of service.
Extraordinary pension is another pension scheme that is awarded to those government employees who are
disabled or the families of those employees who lose their lives during the tenure of their job.

(b) Electronic Fund Transfer (EFT)

SOLUTION

Electronic funds transfer (EFT) are elsectronic transfer of money from one bank account to another, either
within a single financial institution or across multiple institutions, via computer-based systems, without the
direct intervention of bank staff.

According to the United States Electronic Fund Transfer Act of 1978 it is a funds transfer initiated through an
electronic terminal, telephone, computer (including on-line banking) or magnetic tape for the purpose of
ordering, instructing, or authorizing a financial institution to debit or credit a consumer’s account.

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EFT transactions are known by a number of names across countries and different payment systems. For
example, in the United States, they may be referred to as "electronic checks" or "e-checks". In the United
Kingdom, the term "bank transfer" and "bank payment" are used, while in several other European countries
"gyro" is the common term.

(c) Office Layout

SOLUTION

When a management decides to establish an office, it has to carefully define its plan for systematic and
scientific segmentation of various departments and equipment for the office.

The reason is that the systematic arrangement of office equipment leads to availing of maximum benefit
from the space available. The office layout is based on the principle of division of labor. If the principle of
division of labor is applied, every job of an office can be divided into many sections. All the sections may not
be possible to accommodate in one room or on the same floor. Hence, office layout ensures fully utilization of
office space and the efficiency of operation is high.

Meaning of Office Layout

Office layout means the systematic arrangement of office equipment, machines and furniture and providing
adequate space to office personnel for regular performance of work with efficiency.

(d) Communication Machines

SOLUTION

When machines "talk" they do so in a language known as "telemetry." The concept of telemetry -- remote
machines and sensors collecting and sending data to a central point for analysis, either by humans or
computers -- certainly isn't new. But an emerging concept is taking that idea to a whole new level by applying
modern-networking technology.

Three very common technologies -- wireless sensors, the Internet and personal computers -- are coming
together to create machine-to-machine communications, or M2M. The concept holds great promise in
promoting telemetry's use by business, government and private individuals.

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M2M communications, for instance, can be used to more efficiently monitor the condition of critical public
infrastructure, such as water treatment facilities or bridges, with less human intervention. It can help
businesses maintain inventory or make it easier for scientists to conduct research. Because it relies on
common technology, it also could help a homeowner maintain the perfect lawn or create a shopping list at a
button's touch.

M2M communications expands telemetry's role beyond its common use in science and engineering and places
it in an everyday setting. People already are using M2M, but there are many more potential applications as
wireless sensors, networks and computers improve, and the concept is mated with other technology.

How has M2M communications developed? How is it different from traditional telemetry? And what are the
various applications for M2M communications? Read on to find out more about M2M.

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AOM-01 SOLVED ASSIGNMENT 2018-19 Page 21