THE INDIAN COMMUNITY SCHOOL, KUWAIT

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2 THE INDIAN COMMUNITY SCHOOL, KUWAIT SERIES : II TERM /FN/ CODE :M 8 TIME ALLOWED :2 HOURS NAME OF STUDENT : MAX. MARKS :50 ROLL NO. :.. CLASS/SEC :.. NO. OF PAGES : 2 BUSINESS ADMINISTRATION ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 1. Explain the concept of Production Management Define the term Organisational Behaviour. 1. State any one difference between Marketing Concept and Selling Concept Can Organisational Behaviour be considered as a Science as well as an Art? Comment The scope of production management can be considered from the point of view of both strategic decisions influencing the production system and at the operation level. Briefly explain any three Strategic level decisions. 6. State any three features of Organisational Behaviour. 7. Define the term Information Technology. State any two importance of Information technology related to the functional areas of management. 8. State the meaning of Human Resource Management as a Functional area of management. Explain any two of its managerial functions. 9. Briefly explain any four Operative functions of Human Resource Management What do you mean by Group Dynamics? Explain any three views about Group Dynamics State in detail the elements of Marketing Mix Organisational Behaviour is an integral part of most management programmes. Is it correct? Explain by giving any five points. 1. It is a management technique, which aims to see that the activities are carried out as per the plan. Identify the technique. Briefly explain the steps involved in it. 5 5

3 14. Briefly explain the different types of Groups. From your view point explain with relevant points how Informal Groups contribute towards the success of an Organisation. 15. Identify the financial decision which determines the amount of profit earned to be distributed and to be retained in the business. Explain any five factors affecting this decision. 6 6

4 MID-TERM EXAMINATION INDIAN COMMUNITY SCHOOL, KUWAIT Class:11 BUSINESS ADMINISTRATION (Answer Key) Time:2hrs. Max.Marks:50 1. Production management refers to planning, organization, direction, coordination and control of the production function in such a way that desired goods and services could be produced at the right time, in right quantity, and at the right cost. 2. According to Keith Davis organizational behaviour is the study and application of knowledge about how people act within organizations. It is human tool for the human benefit. It applies broadly to behaviour of people in all type of organization such as business, government, schools, etc. it helps people, structure, technology, and the external environment blend together in to an effective operative system Selling Concept focuses on making every possible sale of the product, regardless of the quality of the product or the need of the customer. The main focus is to make money. Marketing concept works on an assumption that consumers buy products which fulfil their needs. The business establishes a relationship with the customer and generate profits in the long run. 4. Organisational behaviour is a science as well as an art. The systematic knowledge about human behaviour is a science and the application of behavioural knowledge and skills is an art. Organisational behaviour is not an exact science because it cannot exactly predict the behaviour of people in organisations. At best a manager can generalize to a limited extent and in many cases, he has to act on the basis of partial information. 5. The strategic level decisions are: New Product Identification and Design: The success of an organisation depends upon the product mix that it offers to the customer. There exists a demands for the products if the product has good market acceptability. The products should be designed in such way as to meet the expectations of customers. The tools like value analysis should be applied at the design stage to avoid unnecessary cost building up in to the product. 2. Process Design and Planning: This involves the appropriate technology for conversion of raw materials in to products. The choice of technology depends upon several factors such as demand, investment capability, labour availably and degree of automation required. This is followed by selection of the process of conversion and determining the workstations and the flow of work. At this stage, macro level process planning is done.

5 . Facilities Location and Layout Planning: The facilities location is a strategic decision and facilities once located will not be altered in near feature. So due considerations should be given to all the factors that affect the location. 4. Design of Material Handling System: As per the principle of Material handling, the handling should be kept at minimum though it is not possible to avoid handling. The selection of particular flow pattern and material handling equipment is dependent on the distance between the workstations, intensity of flow or traffic and size, shape and nature of materials to be handled. 5. Capacity Planning: This decision is concerned with the procurement of fixed assets like plant and machineries. The decision regarding the size of the plant, output etc. are decided at this stage. The capacity planning activity is again a function of volume of demand. The operational level decisions are short-term decisions. These are mainly concerned with planning and control of production activities. 6. Features of Organisational Behaviour: (1) Organisational behaviour is the study of human behaviour. (2) Study about behaviour in organisations and () Knowledge about human behaviour would be useful in improving an organisation s effectiveness. 7. Information Technology (IT) was described by Chaffey and Wood as technology resources used for business information management. These resources include software, hardware and telecommunication networks used for managing information. The use of IT relates to all the functional areas: a. Electronic Communications (eg- ) b. Data sharing (eg-database) c. Security systems (eg-virus protection) d. External communications (eg-internet) e. Online support for customers (eg-order tracking) f. Electronic transactions (eg-eft) Today s best technology to manage and process data is the Information technology. IT must be seen as an investment and not an expense. IT is laying a vital and expanding role in business. IT helps the manager to improve the efficiency and effectiveness of their business processes, managerial decision making, and workgroup collaboration, thus helping the managers to strengthen the positions of their company in a rapidly changing environment. IT has become a necessary ingredient for Managers to succeed in today s dynamic global environment. 8. Human resource management: Human resource development or personnel management or manpower management is concerned with obtaining and maintaining of a satisfactory and satisfied work force i.e., employees. It is a specialized branch of management concerned with man management. MANAGERIAL FUNCTIONS OF HRM.(explain any two) 1. Planning.

6 2. Organizing.. Directing. 4. Controlling. 9. Operative Functions. 4 1.Employment: The first operative function of the human resource of personnel department is the employment of proper kind and number of persons necessary to achieve the objectives of the organisation. This involves recruitment, selection, placement, etc. of the personnel. Before these processes are performed, it is better to determine the manpower requirements both in terms of number and quality of the personnel. Recruitment and selection cover the sources of supply of labour and the devices designed to select the right type of people for various jobs. Induction and placement of personnel for their better performance also come under the employment or procurement function. 2.Motivation: Employees work in the organisation for the satisfaction of their needs. In many of the cases, it is found that they do not contribute towards the organisational goals as much as they can. This happens because employees are not adequately motivated. The human resource manager helps the various departmental managers to design a system of financial and non-financial rewards to motivate the employees..industrial Relations: These days, the responsibility of maintaining good industrial relations is mainly discharged by the human resource manager. The human resource manager can help in collective bargaining, joint consultation and settlement of disputes, if the need arises. This is because of the fact that he is in possession of full information relating to personnel and has the working knowledge of various labour enactments. The human resource manager can do a great deal in maintaining industrial peace in the organisation as he is deeply associated with various committees on discipline, labour welfare, safety, grievance, etc. He helps in laying down the grievance procedure to redress the grievances of the employees. He also gives authentic information to the trade union leaders and conveys their views on various labour problems to the top management. 4.Compensation: This function is concerned with the determination of adequate and equitable remuneration of the employees in the organisation of their contribution to the organisational goals. The personnel can be compensated both in terms of monetary as well as non-monetary rewards. Factors which must be borne in mind while fixing the remuneration of personnel are their basic needs, requirements of jobs, legal provisions regarding minimum wages, capacity of the organisation to pay, wage level afforded by competitors etc. For fixing the wage levels, the personnel department can make use of certain techniques like job evaluation and performance appraisal. 10. The term group dynamics is formed by the combination of the two words group and dynamics. While group refers to two or more individuals sharing an explicit socio-psychological relationship, dynamics refers to the forces within the group that shape the patterns of interaction between group members i.e., the power or capacity of a group member to change or influence change in other members according to changed circumstances. 4

7 Three views about group dynamics: 1. First view describes how a group should be organized and conducted, stressing more on democratic leadership and members participation. 2. Second view describes the techniques used in group dynamics, for instance, role playing, leaderless groups, brainstorming, group therapy, transactional analysis etc.. Third view describes group dynamics from the perspective of internal nature of groups; the structure, processes, reasons and methods of their formation, their influence within the group, with other groups and with the organization. The three views can be summarized by describing group dynamics as a study of the nature and development of groups. 11. ELEMENTS OF MARKETING MIX 4 The marketing mix consists of various variables, which have broadly been classified into four categories,popularly known as four Ps of marketing. These are: (i) Product, (ii)price, (iii) Place, and (iv) Promotion 1.Product: Product means goods or services or anything of value, which is offered to the market for exchange. product relates to not only the physical product but also the benefits offered by it. The important product decisions include deciding about the features, quality,packaging, labelling and branding of the products. 2. Price: Price is the amount of money customers have to pay to obtain the product. In case of most of the products, level of price affects the level of their demand. The marketers have to analyse the factors determining the price and fix a price for the firm s products. Customers perceive the price to be in line with the value of the product.. Place: Place or Physical Distribution include activities that make firm s products available to target customers.important decision areas include selection of dealers or intermediaries(channels of distribution), managing inventory, storage and warehousing and transportation of goods from the place it is produced to the place it is required by the consumers. 4. Promotion:Promotion of products and services include activities that communicate availability, features,merits, etc. of the products to the target customers and persuading or influencing them to buy it. Tools such as advertising, personal selling, sales promotion techniques (like price discounts, free samples, etc.) and publicity/public relations are widely used by marketers to encourage huge sales. 12. Importance of Organisational Behaviour: 5 1. Understanding the relationship between an organisation and its employees: The study of Organisational Behaviour helps in the better understanding of the relationship between an organisation and its employees thereby helping in the development of better Human Resource strategies in creating a better work environment, employee loyalty and increasing the overall value of the human capital for the organisation. 2. Motivating employees: Studying Organisational Behaviour help

8 managers to better understand their employees and motivate them, applying different motivational tools as per individual requirements resulting in the better performance of the organisation as a whole.. Improving industrial/ labour relations: Organisational Behaviour help in understanding the cause of a problem, predict its future course and control its consequences. As a result, managers are able to maintain better relations with their employees by nipping any problem in the bud. 4. Effective utilisation of Human Resource: Knowledge of Organisational Behaviour help managers to effectively and efficiently manage their employees, inspiring and motivating them to higher efficiency and productivity through a better understanding and analysis of human behaviour. 5. Predicting human behaviour: This is probably the most important reason for studying Organisational Behaviour in management. Knowledge of Organisational Behaviour prepares students to become better managers by becoming a student of human behaviour from a management perspective and thereby contributing to organisational effectiveness and profitability. 1. Production control. 5 Following are the stepd involved in the Production Control: (i) Routing. (ii)loading. (iii)scheduling. (iv)dispatching. (v)follow-up. (i) Routing: "Routing means determination of the route to be followed by each part/component being transformed from input/raw material into final product. Routing is the first step in production planning and control. Routing can be defined as the process of deciding the path (route) of work and the sequence of operations. Routing fixes in advance: The quantity and quality of the product. The men, machines, materials, etc. to be used. Routing procedure consists of six decisions as mentioned below: a. The article is analysed to find out which parts or components can be made or bought. b. The article is analysed to find out what materials are needed. c. The manufacturing operations and their sequence will be determined. d. The quantity to be manufactured in one lot or order will be found out. e. The amount of possible scraps and rejection in each lot will be estimated. f. Production control forms like production order, route sheets,jobcards,inspectioncards,movetickets,tooltickets,etc,will be prepared. (ii)loading: Loading refers to systematic assignment of appropriate personnel to jobs or tasks in an efficient and effective manner.the Production management department has to focus on the capacity of its various machines on one hand, and the work load or pending orders on the other. Overloading will lead to physical, mental and nervous exhaustion for the workmen,and overheating and consequent breakdown or equipment failure. (iii)scheduling:

9 Scheduling is planning the time element of production i.e. prior determination of when work is to be done. It consists of the starting and completion times for the various operations to be performed. In other words, scheduling function determines when an operation is to be performed, or when work is to be completed, the difference lies in the details of the scheduling procedure. To work out effectively, the scheduling, as a part of production control function, determines the time when each operation called for on the route sheet is to be done on the specified machine in order to meet the desired delivery dates. Good control function directs not only the time that each particular operation should start but also indicates the progress of each manufacturing part, the amount of work ahead of each machine, and the availability of each machine for the assignment of new work. Schedules are of two types: Master schedule and Detailed schedule. Activities, if recorded on plant-wise basis, would be preparing master schedule, while mere detailed schedules are employed to plan the manufacturing and assembly operations required for each product. (iv)dispatching: Dispatching is the part of production control that translates the paper work into actual production. It is the group that coordinates and translates planning into actual production. Dispatching function proceeds in accordance with the details worked out under routing and scheduling functions. As such, dispatching sees to it that the material is moved to the correct work place, that tools are ready at the correct place for the particular operations, that the work is moving according to routing instructions. Dispatching carries out the physical work as suggested by scheduling. Thus, dispatching implies the issuance or work orders. These work orders represent authority to produce. These orders contain the following information: The name of the product; The name of the part to be produced, sub-assembly or final assembly; The order number; The quantity to be produced; Descriptions and numbers of the operations required and their sequence, The departments involved in each operation The tools required for particular operation; and Machines involved in each operation and starting dates for the operations. (v)follow-up: Follow-up is the last stage in the process of production control. This function is designed to keep track of the work effort. The aim is to ensure that what is intended and planned is being implemented. Expediting consists in reporting production data and investigating variances from predetermined time schedules. The main idea behind expedition is to see that promise is backed up by performance. 14. There are two types of groups in every organization: Formal groups and Informal groups Formal Groups: An organization creates and maintains formal groups to fulfill needs or tasks that are included in its mission or organizational goals. In order to achieve its ultimate goal, an organization creates sub-goals which it assigns to different units or departments. These formal groups created by the organization itself are regulated by the organizational rules and regulations. 2. Informal Groups: Informal groups are formed as they satisfy the social needs of individuals while at work. As they are not created by the organization, the working of informal groups is not regulated by organizational rules and regulations.

10 As informal groups are smaller in size as compared to formal groups groupcohesiveness is easy to maintain. In-spite of this, informal groups are not very stable. The instability is primarily due to the personality differences between the members of the informal group. Advantages of Informal Groups: 1.Sense of Belonging: Several major functions are served by informal groups. For example, the group serves as a means of satisfying the affiliation needs of its members for friendship and support. People need to belong, to be liked, to feel a part of something. Because the informal group can withhold this attractive reward, it earns the power to exploit group members to comply with its norms. 2.Identity and self-esteem: Groups also provide a means of developing, enhancing, and confirming a person s sense of identity and self-esteem. Although many organizations attempt to recognize these higher needs, the nature of some jobs-their technology and environment-precludes this from happening. The long assembly line or endless rows of desks reinforce a feeling of depersonalization..stress Reduction: By developing a consensus about their feelings, group members are able to reduce the anxiety associated with their jobs. For instance, several individuals may share the feeling that their supervisor is a slave driver or that their working conditions are inadequate. 4.All for One, One for All: Joining forces in a small group makes the members feel stronger, less anxious, and less insecure in the face of a perceived threat. As long as needs exist that are not served by the formal organization, informal groups will form to fill the gap. Since the group fills many important needs for its members, it influences member behaviour. 5.Leadership of Informal Work Groups: Informal groups possess certain characteristics that can be used to advantage. While many of these characteristics are similar to those of formal organizations, others are unique. One attribute of informal groups is rotational leadership. The supervisor can attempt to co-opt informal leaders by absorbing them into the leadership or the decision-making structure of the formal group and thereby make the formal organizations more stable. However, a leader may lose favour with the group because of this association with management, and group members will most likely select another leader. 15. Dividend Decisions. 6 The third important decision that every financial manager has to take relates to the distribution of dividend.dividend is that portion of profit which is distributed to shareholders.the decision involved here is how much of the profit earned by company (after paying tax) is to be distributed to the shareholders and how much of it should be retained in the business for meeting the investment requirements.while dividend constitutes current income reinvestment as retained earning increases the firms future earning capacity.the extent of retained earnings,also influences the financing decision of the firm. Since the firm does not require finds to the extent of re-invested retained earnings, the dividend decision should be taken keeping in mind the objective of maximising shareholder s wealth. Factors Affecting Dividend Decisions

11 (a)earnings: Dividends are paid out of current and past earnings. Therefore,earnings is a major determinant of the decision about dividends. (b) Stability of Earnings:A company having stable earning is in a position to declare higher dividends.a company having unstable earnings is likely to pay smaller dividend. (d) Growth Opportunities:Companies having good growth opportunities retain more money out of their earnings so as to finance the required investment. The dividend in growth companies is, therefore,smaller,than in the non growth co.s. (e) Cash Flow Position: Dividend payment involves an outflow of cash. A company may be profitable but short on cash. Availability of enough cash in the company is necessary for declaration of dividends. (f) Legal Constraints: Certain provisions of the Company s Act place restrictions on payouts as dividend.such provisions must be adhered to while declaring the dividends. (g) Contractual Constraints:While granting loans to a company,sometimes the lender may impose certain restrictions on the payment of dividends in future. The companies are required to ensure that the dividends do not violate the terms of the loan agreement.