Class 12 Business Studies - Chapter Nature and Significance of Management NCERT Solutions | “A successful enterprise has to ac
“A successful enterprise has to achieve its goals effectively and efficiently.” Explain.
Management is the place of working together to achieve a specific goal by utilising the resources available effectively and efficiently. For management it is important to be both effective and efficient. Effectiveness and efficiency are two sides of the same coins. Effectiveness means finishing the given task in a given period of time. In other words it is concerned with the end result. It is one of the important aspects of management.
Efficiency means doing the task correctly, and with least amount of resources at minimum cost. If an organisation is efficient then it would reduce the cost of the organisation and as a result it will lead to increase in profit. Effectiveness and efficiency are two important aspects of the management for achieving the desired goal. Being effective means actually achieving the goals without considering the cost of input. While, being efficient will reduce the cost of input which results in increase in profit. That is why if the company focuses on effectiveness, then it may have to compromise on efficiency and vice versa.
For example if a company need to hire more employees to achieve the target then it would increase the cost of production as they need to give salary to the employees that are hired for that project. Here the task will complete effectively not efficiently.
And if the company continues to work with available resources then it would delay the project. Here the cost is not increased and the work is done efficiently not effectively. So, the company has to compromise on one for the other. Therefore, it is important for management to achieve goals with minimum resources as possible while maintaining a balance between effectiveness and efficiency.
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Indian Railways has launched a new broad gauge solar power train which is going to be a path breaking leap towards making trains greener and more environment friendly. The solar power DEMU (Diesel Electric Multiple Unit) has 6 trailer coaches and is expected to save about 21,000 liters of diesel and ensure a cost saving of Rs 12, 00,000 per year. Name the objectives of management achieved by Indian Railways in the above case.
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Ashita and Lakshita are employees working in Dazzling enterprises dealing in costume jewellery. The firm secured an urgent order for 1,000 bracelets that were to be delivered within 4 days. They were assigned the responsibility of producing 500 bracelets each at a cost of Rs 100 per bracelet. Ashita was able to produce the required number within the stipulated time at the cost of Rs 55,000 whereas, Lakshita was able to produce only 450 units at a cost of Rs 90 per unit. State whether Ashita and Lakshita are efficient and effective. Give reasons to justify your answer.
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Company X is facing a lot of problems these days. It manufactures white goods like washing machines, microwave ovens, refrigerators and air conditioners. The company’s margins are under pressure and the profits and market share are declining. The production department blames marketing for not meeting sales targets and marketing blames production department for producing goods, which are not of good quality meeting customers’ expectations. The finance department blames both production and marketing for declining return on investment and bad marketing. State the quality of management that the company is lacking? What quality of management do you think the company is lacking? Explain briefly. What steps should the company management take to bring the company back on track?
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A company wants to modify its existing product in the market due to decreasing sales. You can imagine any product about which you are familiar. What decisions/steps should each level of management take to give effect to this decision?
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Ritu is the manager of the northern division of a large corporate house. At what level does she work in the organisation? What are her basic functions?
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A firm plans in advance and has a sound organisation structure with efficient supervisory staff and control system but on several occasion it finds that plans are not being adhered to. It leads to confusion and duplication of work. Advise remedy.
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