Principles of Management Class 12 Notes: CBSE 12th Business Studies Chapter 2, Download PDF

Principles of Management Class 12 Notes: In this article, students can find CBSE Class 12 Business Studies Chapter 2, Principles of Management. A PDF download link has also been attached at the bottom of the article for future reference. Class 12 Principles of Management notes are based on the revised and updated CBSE syllabus for the current academic session 2023-2024.

CBSE Principles of Management Class 12 short notes are important for students to clear their basic understanding of the topics present in the chapter. These revision notes will guide you in understanding the chapters, practicing solutions, and revising during examinations.

 Why are revision notes important?

Revision Notes are important because of the following reasons:

• Saves time during exams
• Revision becomes easy and quick at the time of examinations
• They are handy and can be used anytime and anywhere
• Recalls all the important information
• Presents all important details at a single location

 Related:

CBSE Class 12 Business Studies MCQs

CBSE Class 12 Business Studies Mind Maps

NCERT Solutions for Class 12 Business Studies 2023-2024

 Principles of Management Class 12 Revision Notes

 Nature of Principles of Management

The nature of the principles of management is discussed below:

• Universal applicability
• General guidelines
• Formed by practice and experimentation
• Flexible
• Mainly behavioral
• Cause and effect relationships
• Contingent

 Importance of Principles of Management

Principles of management are important because:

• Providing managers with useful insights into reality
• Optimum utilization of resources and effective administration
• Scientific decisions
• Meeting changing environment requirements
• Fulfilling social responsibility
• Management training, education, and research

Principles of Scientific Management

Various principles of scientific management are:

• Science not Rule of Thumb
• Harmony, not Discord
• Co-operation, not Individualism-
• Development of Each and Every Person to His or Her Greatest Efficiency and Prosperity

Techniques of Scientific Management

Different techniques of scientific management are:

• Functional Foremanship- The foreman represents the managerial figure with whom the workers are in face-to-face contact on a daily basis. Taylor advocated the separation of planning and execution functions. This concept was extended to the lowest level of the shop floor. It was known as functional foremanship. It is an extension of the principle of division of work and specialization to the shop floor.
• Standardization and Simplification of Work-Standardisation refers to the process of setting standards for every business activity. Simplification aims at eliminating unnecessary diversity of products. It results in savings in the cost of labour, machines, and tools. It implies reduced inventories, fuller utilisation of equipment, and increasing turnover.
• Method Study- The objective of a method study is to find out the best way of doing the job. There are various methods of doing the job. Right from procurement of raw materials till the final product is delivered to the customer every activity is part of the method study.
• Motion Study- Motion study refers to the study of movements like lifting, putting objects, sitting and changing positions, etc., which are undertaken while doing a typical job. Unnecessary movements are sought to be eliminated so that it takes less time to complete the job efficiently.
• Time Study- The method of time study will depend upon the volume and frequency of the task, the cycle time of the operation, and time measurement costs. The objective of the time study is to determine the number of workers to be employed; frame suitable incentive schemes and determine labor costs.
• Fatigue Study- A person is bound to feel tired physically and mentally if she/he does not rest while working. The rest intervals will help one to regain stamina and work again with the same capacity. This will result in increased productivity. 
• Differential Piece Wage System- Taylor wanted to reward efficient workers. So he introduced different rates of wage payment for those who performed above standard and for those who performed below standard.

 Fayol’s Principles of Management

The principles of management laid down by Fayol are as follows:

• Division of Work- The intent of division of work is to produce more and better work for the same effort. Specialization is the most efficient way to use human effort.
• Authority and Responsibility- There should be a balance between authority and responsibility. An organization should build safeguards against abuse of managerial power. At the same time, a manager should have the necessary authority to carry out his responsibility.
• Discipline- According to Fayol, discipline requires good superiors at all levels, clear and fair agreements, and judicious application of penalties.
• Unity of Command- The principle of unity of command states that each participant in a formal organisation should receive orders from and be responsible to only one superior. Fayol said that if this principle is violated “authority is undermined, discipline is in jeopardy, order disturbed and stability threatened”.
• Unity of Direction- All the units of an organisation should be moving towards the same objectives through coordinated and focused efforts. 
• Subordination of Individual Interest to General Interest- The interests of an organisation should take priority over the interests of any one individual employee.
• Remuneration of Employees- The overall pay and compensation should be fair to both employees and the organisation. The employees should be paid fair wages, which should give them at least a reasonable standard of living.
• Centralisation and Decentralisation- The concentration of decision-making authority is called centralisation whereas its dispersal among more than one person is known as decentralisation. There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through centralisation.
• Scalar Chain- An organisation consists of superiors and subordinates. The formal lines of authority from highest to lowest ranks are known as scalar chain.“Organisations should have a chain of authority and communication that runs from top to bottom and should be followed by managers and subordinates.
• Order- The principle of the order states that ‘A place for everything (everyone) and everything (everyone) in its (her/his) place’. Essentially it means orderliness. If there is a fixed place for everything and it is present there, then there will be no hindrance in the activities of the business/ factory. This will lead to increased productivity and efficiency.
• Equity- Good sense and experience are needed to ensure fairness to all employees, who should be treated as fairly as possible. This principle emphasizes kindliness and justice in the behaviour of managers towards workers.
• Stability of Personnel- Personnel should be selected and appointed after due and rigorous procedure. But once selected they should be kept at their post/position for a minimum fixed tenure.
• Initiative- Workers should be encouraged to develop and carry out their plans for improvements. Initiative means taking the first step with self-motivation. It is thinking out and executing the plan. It is one of the traits of an intelligent person.
• Espirit De Corps- Management should promote a team spirit of unity and harmony among employees. It should promote teamwork, especially in large organisations because otherwise, objectives would be difficult to realize.

 Difference between Unity of Command and Unity of Direction

The differences between Unity of Command and Unity of Direction are as follows:

 Fayol vs Taylor

The differences between Fayol and Taylor are as follows:

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Also Read:

CBSE Class 12 Business Studies Syllabus 2023-2024

CBSE Class 12 Business Studies Sample Paper 2023-2024