Sub :PRINCIPLES OF MANAGEMENT

B.E III SEM ( CSE, IT) NOV 2019.

1. List the features of scientific management proposed by FW taylor.
The features of scientific management are as follows:
(i) It is a systematic approach to handle management problems.
(ii) It implies scientific techniques in method of work, recruitment, selection and training of
workers.
(iii) It rejects the age old method of rule of thumb' or 'hit or miss' approach
2. Define partnership
The term partnership, is used to mean a business structure wherein two or more individuals, come
together for undertaking a lawful business and have agreed to share the profits and losses arising
from it. ... It is started through a legal agreement between partners, called as partnership deed
3. What are principles of plant layout.

While designing the layout of a plant, the following principles should be kept in mind:

(i) Principle of minimum movement. ...

(ii) Principle of flow. ...
(iii) Principle of space. ...
(iv) Principle of safety. ...
(v) Principle of flexibility. ...
(vi) Principle of interdependence. ...
(vii) Principle of overall integration.

4. What are the factors effecting plant location.

Factors Affecting Plant Location

Law and order situation,

Availability of infrastructure facilities,
Good industrial relations,
Availability of skilled workforce,
Social infrastructure,
Investor friendly attitude,
Nearness to market,
Nearness to raw-materials' source,

5. State the objectives of employees training

(i) To provide job related knowledge to the workers.

(ii) To impart skills among the workers systematically so that they may learn quickly.
(iii) To bring about change in the attitudes of the workers towards fellow workers,
supervisor and the organization.
(iv) To improve the productivity of the workers and the organization.
:(v) To reduce the number of accidents by providing safety training to the workers,

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 (vi) To make the workers handle materials, machines and equipment efficiently and thus
to check wastage of time and resources.
(vii) To prepare workers for promotion to higher jobs by imparting them advanced skills.

6. list the methods of training .

i. Technology-Based Learning. Common methods of learning via technology include: ...

ii. Simulators. Simulators are used to imitate real work experiences. ...
iii. On-The-Job Training. ...
iv. Coaching/Mentoring. ...
v. Lectures. ...
vi. Group Discussions & Tutorials. ...
vii. Role Playing. ...
viii. Management Games.

7. Compare positive and negative motivation

negative motivation to motivate his employees is most likely going to be hated. So
The difference between positive and negative motivation is that positive motivation doesn't
have side effects on the long run while negative motivation may have some. Positive
motivation is a reward for good performance. ... Negative motivation, on the other hand, is
punishment for poor performance.

8. State the characteristics of leadership.

The Characteristics of a Good Leadership are

 Honesty.
 Ability to delegate.
 Communication.
 Sense of humor.
 Confidence.
 Commitment.
 Positive attitude.
 Creativity.

9. State the advantages of budgetary control.

ADVANTAGES OF BUDGETARY CONTROL

• The major strength of budgeting is that it coordinates activities across departments.
• Budgets translate strategic plans into action. They specify the resources, revenues, and activities
required to carry out the strategic plan for the coming year.
• Budgets provide an excellent record of organizational activities.
• Budgets improve communication with employees.
• Budgets improve resources allocation, because all requests are clarified and justified.
• Budgets provide a tool for corrective action through reallocations.
10. What is budget.
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 A budget is an itemized summary of likely income and expenses for a given period. It’s an
invaluable tool to help you prioritize your spending and manage your money—no matter how
much or how little you have. Planning and monitoring your budget will help you identify
wasteful expenditures, adapt quickly as your financial situation changes, and achieve your
financial goals.

Section B
11. A. outline the functions of management

1. Planning
It is the basic function of management. It deals with chalking out a future course of action
& deciding in advance the most appropriate course of actions for achievement of pre-
determined goals. According to KOONTZ, “Planning is deciding in advance - what to do,
when to do & how to do. It bridges the gap from where we are & where we want to be”. A
plan is a future course of actions. It is an exercise in problem solving & decision making.
Planning is determination of courses of action to achieve desired goals. Thus, planning is
a systematic thinking about ways & means for accomplishment of pre-determined goals.
Planning is necessary to ensure proper utilization of human & non-human resources. It is
all pervasive, it is an intellectual activity and it also helps in avoiding confusion,
uncertainties, risks, wastages etc.

2. Organizing
It is the process of bringing together physical, financial and human resources and developing
productive relationship amongst them for achievement of organizational goals. According to Henry
Fayol, “To organize a business is to provide it with everything useful or its functioning i.e. raw
material, tools, capital and personnel’s”. To organize a business involves determining & providing
human and non-human resources to the organizational structure. Organizing as a process involves:

 Identification of activities.
 Classification of grouping of activities.

 Assignment of duties.

 Delegation of authority and creation of responsibility.

 Coordinating authority and responsibility relationships.

3. Staffing
It is the function of manning the organization structure and keeping it manned. Staffing has
assumed greater importance in the recent years due to advancement of technology, increase in
size of business, complexity of human behavior etc. The main purpose o staffing is to put right man
on right job i.e. square pegs in square holes and round pegs in round holes. According to Kootz &
O’Donell, “Managerial function of staffing involves manning the organization structure through
proper and effective selection, appraisal & development of personnel to fill the roles designed un
the structure”. Staffing involves:

 Manpower Planning (estimating man power in terms of searching, choose the person and
giving the right place).

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  Recruitment, Selection & Placement.

 Training & Development.

 Remuneration.

 Performance Appraisal.

 Promotions & Transfer.

4. Directing
It is that part of managerial function which actuates the organizational methods to work
efficiently for achievement of organizational purposes. It is considered life-spark of the
enterprise which sets it in motion the action of people because planning, organizing and
staffing are the mere preparations for doing the work. Direction is that inert-personnel
aspect of management which deals directly with influencing, guiding, supervising,
motivating sub-ordinate for the achievement of organizational goals. Direction has
following elements:
 Supervision
 Motivation

 Leadership

 Communication

5. Controlling
It implies measurement of accomplishment against the standards and correction of
deviation if any to ensure achievement of organizational goals. The purpose of controlling
is to ensure that everything occurs in conformities with the standards. An efficient system
of control helps to predict deviations before they actually occur. According to Theo
Haimann, “Controlling is the process of checking whether or not proper progress is being
made towards the objectives and goals and acting if necessary, to correct any deviation”.
According to Koontz & O’Donell “Controlling is the measurement & correction of
performance activities of subordinates in order to make sure that the enterprise objectives
and plans desired to obtain them as being accomplished”. Therefore controlling has
following steps:

a. Establishment of standard performance.

b. Measurement of actual performance.

c. Comparison of actual performance with the standards and finding out deviation if
any.

d. Corrective action.

(b) compare private and public limited companies.

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 12. (a) differentiate management and organization
Management is all about plans and actions, but the administration is concerned with framing
policies and setting objectives. ... The manager looks after the management of the organization,
whereas administrator is responsible for the administration of
the organization. Management focuses on managing people and their work

(b) principles of scientific management.

Four Important Principles of Scientific Management

This principle says that we should not get stuck in

(1) Science, Not Rule of Thumb:
a set routine with the old techniques of doing work, rather we should be
constantly experimenting to develop new techniques which make the work
much simpler, easier and quicker.
(2) Harmony, Not Discord: As per this principle, such an atmosphere should be created in
the organisation that labour (the major factor of production) and management
consider each other indispensable.

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 Taylor has referred to such a situation as a ‘Mental Revolution’. Taylor firmly believed
that the occurrence of a mental revolution would end all conflicts between the two
parties and would be beneficial to both of them.

According to this principle, all the activities done by

(3) Cooperation, Not Individualism:
different people must be carried on with a spirit of mutual cooperation. Taylor has
suggested that the manager and the workers should jointly determine standards.
This increases involvement and thus, in turn, increases responsibility. In this way
we can expect miraculous results.
(4) Development of Each and Every Person to His / Her Greatest Efficiency and Prosperity:
According to this principle, the efficiency of each and every person should be taken
care of right from his selection. A proper arrangement of everybody’s training
should be made.

13. (a) explain the decision making process.

The business decision making process is commonly divided into seven steps. Managers may
utilize many of these steps without realizing it, but gaining a clearer understanding of best
practices can improve the effectiveness of your decisions.

Steps of the Decision Making Process

The following are the seven key steps of the decision making process.
 Identify the decision. The first step in making the right decision is recognizing the problem or
opportunity and deciding to address it. Determine why this decision will make a difference to your
customers or fellow employees.
 Gather information. Next, it’s time to gather information so that you can make a decision based on
facts and data. This requires making a value judgment, determining what information is relevant to the
decision at hand, along with how you can get it. Ask yourself what you need to know in order to make the
right decision, then actively seek out anyone who needs to be involved.
 Identify alternatives. Once you have a clear understanding of the issue, it’s time to identify the various
solutions at your disposal. It’s likely that you have many different options when it comes to making your decision, so it is
important to come up with a range of options. This helps you determine which course of action is the best way to
achieve your objective.
 Weigh the evidence. In this step, you’ll need to “evaluate for feasibility, acceptability and desirability” to
know which alternative is best, according to management experts Phil Higson and Anthony Sturgess. Managers need
to be able to weigh pros and cons, then select the option that has the highest chances of success. It may be helpful to
seek out a trusted second opinion to gain a new perspective on the issue at hand.
 Choose among alternatives. When it’s time to make your decision, be sure that you understand
the risks involved with your chosen route. You may also choose a combination of alternatives now that you
fully grasp all relevant information and potential risks.
 Take action. Next, you’ll need to create a plan for implementation. This involves identifying what
resources are required and gaining support from employees and stakeholders. Getting others onboard with

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 your decision is a key component of executing your plan effectively, so be prepared to address any
questions or concerns that may arise.
 Review your decision. An often-overlooked but important step in the decision making process is
evaluating your decision for effectiveness. Ask yourself what you did well and what can be improved next
time.
13(b) compare product layout and process layout.

14. (a) what are the steps in strategic process planning.

the individual stages of the strategic planning process and how they affect your business.

1. Identify Your Strategic Position. ...

2. Gather People and Information. ...
3. Perform a SWOT Analysis. ...
4. Formulate a Strategic Plan. ...
5. Execute Your Strategic Plan. ...
6. Constantly Monitor Performance.

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1. Identify Your Strategic Position
The first stage prepares you for the rest of the strategic planning process. To achieve your
goals, you must first have a clear vision. Start by defining both your short-term and long-term
objectives. In short, what do you hope to achieve? Next, determine what steps you will take to
accomplish these objectives. When identifying your strategic position, remember that your
goals should be realistic and measurable. For help with this step, look back to your mission
statement, corporate values, and work culture.

2. Gather People and Information. ...

Once you have established your strategic position, you will want to bring in the people
who will be involved in the planning process. You will also want to bring in as much
up-to-date information to the table as possible. Ensure that any data you use is
accurate so that you make informed decisions backed up by facts. Once you have
people and information to draw from, examine any internal or external issues that
could possibly affect your objectives. It may be useful to ask other people in your
business for their input, such as employees, customers, or partners.

3. Perform a SWOT Analysis

SWOT, which is an acronym for strengths, weakness, opportunities, and threats, acts as a
powerful tool during the strategic planning process. A SWOT analysis is often performed to
help identify the strengths and weaknesses of a business, as well as identify any opportunities
and threats that could arise. Once the team has identified all strengths, weaknesses,
opportunities and threats, you can work together to develop new goals that will help your
business face these possibilities in a more positive way. A SWOT analysis can also lead you in
the right direction and towards your goals.

4. Formulate a Strategic Plan

Once you have successfully identified your strategic position and have a set of goals that
align with your company’s mission, you can begin working on your strategic plan. When
developing your plan, consider which initiatives will have the greatest impact on your
business and which will help improve your position the most. Also consider which initiatives
are most urgent and put these at the front of the line. To ensure that your strategic plan is
working, you will need to determine the best way to measure your progress. With measurable
goals you can visibly see improvements as they happen.

5. Execute Your Strategic Plan

Once you have your strategic plan in place, you are ready to implement it. This step is the
action phase of the strategic planning process. Start by making everyone involved in the plan
aware of your strategy. Ideally, you want to distribute tasks among different individuals or

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departments to prevent one person or group of people from becoming overwhelmed. Also
take the time to check back with these individuals or groups to ensure that you are staying on
track. If you find that you are not meeting your objectives, make any necessary changes.

6. Constantly Monitor Performance

Your strategic planning process will not be effective unless everyone is doing their part. This
requires you to constantly monitor and manage performance and tweak any components that
are not leading to satisfactory results. It is also important to hold those involved in the
strategic planning process accountable for their assigned tasks. Know that it may be
necessary to repeat the strategic management process if any corrective actions you take are
not successful. Continue to collect new and relevant data to help with any future strategic
planning that may occur.

14.(b) discuss strategy management tools

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15. (a)compare formal and informal organization

15 (b) summarise the merits and demerits of line and staff organization.

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 Advantages of Line and Staff Organisation
1. Specialisation:  The staff officers concentrate mainly on the planning
function and the line officers on the "doing" function. By this method,
specialisation is attained.
2. Flexibility:  Staff can be added to the line and new activities may be
introduced without disturbing the line procedure. Hence, there is greater
flexibility in the organisation.
3. Expert Advice:  The staff officers provide expert advice and guidance to
line officers and by this, the enterprise as a whole gets benefit.
4. Sound Decisions:  In this type, the decisions are made by experts and
hence, there is a possibility of making sound managerial decisions.
5. Relief to Line Executives:  The Staff officers look after the detailed
analysis of each important managerial activity which is a big relief to the line
officers.
6. Opportunities for Advancement.  In this type, a greater variety of
responsible jobs are available and this provides more opportunities for
advancement of capable workers.

Fig. 5.13 Line and Staff Organisation

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 Disadvantages of Line and Staff Organisation
1. Confusion:  If the pattern of authority relationship between line and staff
executives is not clearly indicated, there may be considerable confusion
throughout the organisation.
2. Advice Ignored:  As the staff officers lack authority to put their
recommendations into practice, their advice may be ignored by the line
executives.
3. Encourages Carelessness:  As the staff officer is not concerned with the
execution of the plan, he may not take proper precautions and care before he
advises the line officer. Thus, this system may encourage carelessness on the
part of the staff officer.
4. Expensive:  This type requires the appointment of a large number of
experts involving heavy expenditure. Hence, it is quite expensive and small
and medium-sized concerns cannot afford it.
5. Conflict between Line and Staff:  One more important disadvantage is the
conflict between the line and staff officers. The viewpoints of both line and
staff of this conflict are given below:
A. The Line Viewpoint. The line managers have the following to say about the
staff people:
(i) Staff authority undermines line authority and interferes in the work of line
managers.
(ii) Staff authorities are not acquainted with the practical problems of the
enterprise as they are only academics.
(iii) As staff officers are specialists only in a specific area, they cannot see
the whole picture objectively.
(iv) Advice given by the staff is not always sound. Advice is only theoretical
and unrealistic.
(v) Staff take credit if the programme (as per the advice of the staff) is
successful and blame the line if it is not successful.
B. The Staff Viewpoint. Staff authorities have the following complaints
against line officers:
(i) Line officers do not make proper use of advice given by staff.
(ii) Line officers reject the advice without giving reasons.
(iii) Line officers are slow to accept new ideas and they resist change.
(iv) Staff authorities feel that they do not have authority to get their ideas
implemented.

16. (a) elaborate the methods of training.

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Methods of training
There are wide ranges of training methods which are suitable as per the different
categories of personnel in the organization. It depends upon the organization to select
the relevant training method as per the organization needs. The various training
methods are as follows:

i) On the job method of training:

It is the most effective training where the workers are given training at the place of
work. It means they learn in the actual working environment which means they are
learning while doing. This type of training is cheaper and less time-consuming as it
involves learning the skills that can be learnt in a short span of time. It involves:

a) Understudy: – here the superior gives training to his subordinate as his understudy
or assistant. It helps the subordinate to prepare for the superior’s job in case superior
leaves the organization.

b) Coaching: – here supervisor gives knowledge to his subordinate. This type of

training is given in case where the superior has enough time to give coaching to the
subordinate.

c)  Job rotation: job rotation means changing the position of the employee from time
to time to help them to learn different skills, to develop all round workers. But there
should be no frequent changes in the job of the employees as they must be given
sufficient time to acquire the full knowledge of the job. This kind of training is suitable
for higher level employees.

ii) Off the job method of training:

It means the employees get the training for a specific period but not at the work place
rather away from the work place. It means they are free from the tension of work
while training. The different types of off the job training are:

a) Case study: under this method trainees are given a problem or a case study which
is more or less related to their job. Then they analyze the problem and give solutions
which are discussed in the classroom. Then the instructor helps them to reach at a
common solution.

b) Lecture cum discussion method: this is also called class room training. The special
lectures can be given by the top executive of the organization or by the specialist in a
particular field. The person is generally expert in the particular field. The trainees
generally had the note books to note down the important points said by the expert.

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This method can also be used for the new entrant in the organization or to deliver the
message to large group in that case the cost per trainee is less. But only in case of
lecture method alone the learners are passive, there is only one way communication
between them so lecture method can be combined with discussion method. Where the
trainees take part in the discussion and give the feedback to the expert.

c) Conference training: in this kind of training the there is a group meeting in which
different persons present their view relating to a particular topic. The members learn
from the others and respect the others viewpoint. The proceedings of the conference
are conducted by the chairman who is responsible for summing up the conference.

iii) Vestibule method of training:

It means training in class room for semi skilled jobs. Here large number of employees
can be trained at the same time for same type of work. The emphasis on learning
rather than the production. Here the attempt is made to create the similar type of
working conditions as actual. It is generally given to clerks, typists etc. but this kind
of training is expensive as it requires duplicate machines to learn the skill.

(b) explain the necessity of career planning.

A career may be defined as ‘ a sequence of jobs that constitute what a person does for a living’.
According to Schermerborn, Hunt, and Osborn, ‘Career planning is a process of systematically
matching career goals and individual capabilities with opportunities for their fulfillment’.
Career planning is the process of enhancing an employee’s future value.
4. A career plan is an individual’s choice of occupation, organization and career path.
Career planning encourages individuals to explore and gather information, which enables them to
synthesize, gain competencies, make decisions, set goals and take action. It is a crucial phase of
human resource development that helps the employees in making strategy for work-life balance.

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 17. (a)discuss the factors affecting effective motivation

There are 9 main components that contribute to employees motivation:

 Salary. ...
 Non-monetary incentives. ...
 Relationship with colleagues. ...
 Relationship with leadership. ...
 Company's culture. ...
 Learning and development opportunities. ...
 Processes within the company. ...
 Personal life.
17 (b) compare individual and group behavior

individual & Group Behavior - Introduction

Organizational behavior is the study of both group and individual performance and action
within an enterprise. This field of study scans human behavior in the working
atmosphere.

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It determines its effect on job structure, performance, communication, motivation,
leadership, decision making abilities etc. The way an individual behaves and behavior as
a group have two perspectives − internal and external.

Behavior Analysis at Different Levels

Behavior as an individual or in a group is always analyzed by everyone in the
organization. It is analyzed at three different levels −

 Individual level of analysis

 Group level of analysis

 Organizational level of analysis

Individual Level of Analysis

Organizational behavior, at this level of analysis massively draws upon psychology,

engineering, and medicine. At the individual level of analysis, organizational behavior
includes the study of learning, perception, creativity, motivation, and personality.
In addition, it also includes the study of turnover, task performance and evaluation,
coordinated behavior, deviant work behavior, ethics, and cognition.
For example − Ram joins a company as an intern and is very open to learning new
things but as time passes and he gets promoted his attitude towards his interns
becomes rude. This is a fine example of individual level of analysis.

Group Level of Analysis

Organizational behavior, at this level of analysis, draws upon the sociological and socio-
psychological discipline. At the group level of analysis, organizational behavior includes
the study of group gesture, intra-group and intergroup dispute and attachment.
It is further extended to the study of leadership, power, norms, interpersonal
communication, networks, and roles.
An example of this level of analysis − Board of directors of company X decide to give
bonus to their workers as they have really worked hard on a certain project.

18. (a) compare authoritative and democratic leadership.

Leaders fall into two broad categories, authoritarian (or autocratic) leaders and democratic (or

participative) leaders. The democratic category also includes the laissez-faire category, which can be
shown separately. Essential requirements of successful, effective leaders are:
1. More clever than average, but not too clever (see 'Leadership Quality').
2. Higher than average enterprise / creativity (see 'Enterprise Test').

Once the above two criteria are met, the personality of the leader will determine how effective he or she is.

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A leader can be authoritarian or democratic, but in order to be effective, he or she
must be task orientated.
The effectiveness of leaders is mainly determined by their personality; dependent upon whether they are
task orientated or driven by emotion.

Box 1 - Leaders should achieve success, at least in the short term, but they may leave longer term problems
as their 'selfish' decision making is restricted through not listening enough to others. They are the ideal
short term solution in rapidly changing or conflict situations where decisions need to be made quickly and
followed through.
Box 2 - Leaders are ideal in short term stable situations, and in the long term, but they may not work too
well in short term rapidly changing or conflict situations.
Box 3 - Leaders may enjoy some success in the short term if there is sufficient overlap of personal needs
with the needs of the team. Leader will fail in long term due to all decisions being made to fulfil own
emotional needs.
Box 4 - Leaders may enjoy some success in the short term, dependent upon the make up of the team
members. Leader will fail in long term due to all decisions being made to satisfy the emotional needs of
other team members.
But it's not quite as straight forward as putting a leader into one of four boxes. Leaders can fall anywhere
on the authoritarian - democratic continuum and anywhere on a task oriented - emotional continuum. In
fact leaders who are task oriented and fall somewhere towards the center of the authoritarian - democratic
continuum tend to be the most successful leaders in business.
Authoritarian or autocratic style leaders also find that they lose more staff members than democratic
leaders. Employees prefer to work for democratic leaders as they feel that they are being listened to,
whereas authoritarian or autocratic style leaders tend to preside over more discontent, hostility and
aggression resulting in employees leaving. 1

18(b) describe the theories of motivation.

Theories of Motivation
Definition: There are several Theories of Motivation that are developed to explain the concept of
“Motivation”. The motivation is a drive that forces an individual to work in a certain way. It is the
energy that pushes us to work hard to accomplish the goals, even if the conditions are not going
our way.
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 With the establishment of human organizations, people tried to find out the answer to, what motivates
an employee in the organization the most. This gave birth to several content theories and process
theories of motivation.

The content theories deal with “what” motivates people, whereas the process theories deal
with, “How” motivation occurs. Thus, theories of motivation can be broadly classified as:

Content Theories: The content theories find the answer to what motivates an individual and is
concerned with individual needs and wants. Following theorists have given their theories of motivation
in content perspective:

1. Maslow’s need Hierarchy

2. Herzberg’s Motivation-Hygiene Theory

3. McClelland’s Needs Theory

4. Alderfer’s ERG Theory

Process Theories: The process theories deal with “How” the motivation occurs, i.e. the process of
motivation and following theories were given in this context:

1. Vroom’s Expectancy Theory

2. Adam’s Equity Theory

3. Reinforcement Theory

4. Carrot and Stick Approach to Motivation

Thus, these theories posit that how an individual gets motivated to perform the task and what are the
factors that contribute towards the motivation.
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 19 (a) explain the benefits of controlling in management.

1. Helps in achieving organisational goals:

When the plans are made in the organisation these are directed towards achievement of
organisational goal and the controlling function ensures that all the activities in the organisation
take place according to plan and if there is any deviation, timely action is taken to bring back the
activities on the path of planning.

2. Judging accuracy of standards:

Through strategic controlling we can easily judge whether the standard or target set are accurate
or not. An accurate control system revises standards from time to time to match them with
environmental changes.

3. Making efficient use of Resources:

Like traffic signal control guides the organisation and keeps it on the right track. Each activity is
performed according to predetermined standards. As a result there is most and effective use of
resources.

4. Improving employee motivation:

An effective control system communicates the goals and standards of appraisal for employees to
subordinates well in advance.

A good control system also guides employees to come out from their problems. This free
communication and care motivate the employees to give better performance.

5. Ensures order and discipline:

Control creates an atmosphere of order and discipline in the organisation. Effective controlling
system keeps the subordinates under check and makes sure they perform their functions
efficiently.

Sharp control can have a check over dishonesty and fraud of employees. Strict control monitor,
employees work on computer monitor which brings more order and discipline in work
environment.

6. Facilitate coordination in action:

Control helps to maintain equilibrium between means and ends. Controlling makes sure that
proper direction is taken and that various factors are maintained properly. All the departments
are controlled according to predetermined standards which are well coordinated with one
another. Control provides unity of direction.

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7. Controlling helps in improving the performance of the employees:
Controlling insists on continuous check on the employees and control helps in creating an
atmosphere of order and discipline. Under controlling function it is made sure that employees are
aware of their duties and responsibilities very clearly.

They must know clearly the standards against which their performance will be judged. These
standards help the employees to work efficiently.

19(b) discuss the use of IT in controlling.

Communication Between Employees, Suppliers and Customers

For many companies, email is the principal means of communication between employees, suppliers and customers.

Email was one of the early drivers of the Internet, providing a simple and inexpensive means to communicate. Over the

years, a number of other communications tools have also evolved, allowing staff to communicate using live chat

systems, online meeting tools and video-conferencing systems. Voice over internet protocol (VOIP) telephones and

smart-phones offer even more high-tech ways for employees to communicate.

Inventory Management Systems

When it comes to managing inventory, organizations need to maintain enough stock to meet demand without investing

in more than they require. Inventory management systems track the quantity of each item a company maintains,

triggering an order of additional stock when the quantities fall below a pre-determined amount. These systems are best

used when the inventory management system is connected to the point-of-sale (POS) system. The POS system

ensures that each time an item is sold, one of that item is removed from the inventory count, creating a closed

information loop between all departments.

Data Management Systems

The days of large file rooms, rows of filing cabinets and the mailing of documents is fading fast. Today, most companies

store digital versions of documents on servers and storage devices. These documents become instantly available to

everyone in the company, regardless of their geographical location. Companies are able to store and maintain a

tremendous amount of historical data economically, and employees benefit from immediate access to the documents

they need.

Management Information Systems

Storing data is only a benefit if that data can be used effectively. Progressive companies use that data as part of their

strategic planning process as well as the tactical execution of that strategy. Management Information Systems (MIS)

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enable companies to track sales data, expenses and productivity levels. The information can be used to track

profitability over time, maximize return on investment and identify areas of improvement.

Managers can track sales on a daily basis, allowing them to immediately react to lower-than-expected numbers by

boosting employee productivity or reducing the cost of an item.

Customer Relationship Management

Companies are using IT to improve the way they design and manage customer relationships. Customer Relationship

Management (CRM) systems capture every interaction a company has with a customer, so that a more enriching

experience is possible. If a customer calls a call center with an issue, the customer support representative will be able

to see what the customer has purchased, view shipping information, call up the training manual for that item and

effectively respond to the issue.

The entire interaction is stored in the CRM system, ready to be recalled if the customer calls again. The customer has a

better, more focused experience and the company benefits from improved productivity.

19. A . Need of budget control

The main objectives of budgetary control are the follows:

1. To ensure planning for future by setting up various budgets, the requirements and
expected performance of the enterprise are anticipated.

3. To operate various cost centres and departments with efficiency and economy.

4. Elimination of wastes and increase in profitability.

5. To anticipate capital expenditure for future.

6. To centralise the control system.

7. Correction of deviations from the established standards.

8. Fixation of responsibility of various individuals in the organization.

Essentials of Budgetary Control:

There are certain steps which are necessary for the successful implementation
budgetary control system.

These are as follows:

1. Organisation for Budgetary Control
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2. Budget Centres

3. Budget Mammal

4. Budget Officer

5. Budget Committee

6. Budget Period

7. Determination of Key Factor.

20,(b) budjet and non budget control

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