Class 12 Business Studies Notes Chapter 7 (Directing) – Business Studies-I Book
Detailed Notes with MCQs of Chapter 7, 'Directing'. This is a crucial chapter not just for your board exams, but also for understanding how organisations actually get work done. For government exam preparation, you need a solid grasp of the concepts and their nuances as questions often test application and understanding.
Chapter 7: Directing - Detailed Notes
1. Meaning and Introduction
- Definition: Directing is the managerial function concerned with instructing, guiding, counselling, motivating, and leading people in the organisation to achieve its objectives. It's the heart of management, the process of activating human resources towards the attainment of organisational goals.
- It involves telling people what to do and seeing that they do it to the best of their ability.
- It initiates action in the organisation, transforming plans into performance. Other functions (Planning, Organising, Staffing) merely prepare the setting for action.
2. Characteristics/Features of Directing
- Initiates Action: Directing starts the actual work towards achieving goals.
- Pervasive Function: Required at all levels of management (Top, Middle, Lower/Supervisory). Every manager directs their subordinates.
- Continuous Activity: Directing is an ongoing process throughout the life of the organisation.
- Flows from Top to Bottom: Directions are typically issued by superiors to subordinates. It follows the formal chain of command.
- Performance Oriented: Focuses on improving the performance of individuals towards organisational goals.
- Human Element: Deals directly with influencing human behaviour, which is complex and unpredictable.
3. Importance of Directing
- Initiates Action: Translates plans into performance by guiding employee efforts.
- Integrates Employee Efforts: Coordinates the activities of diverse individuals and groups towards common objectives.
- Means of Motivation: Guides employees to fully realise their potential and capabilities by motivating them.
- Facilitates Introduction of Changes: Effective directing helps overcome resistance to change and secures employee cooperation in implementing changes necessary for organisational growth and survival.
- Brings Stability and Balance: Fosters cooperation and commitment, helping achieve a balance among various groups, activities, and departments.
4. Elements of Directing
Directing comprises four key elements:
a. Supervision
b. Motivation
c. Leadership
d. Communication
A. Supervision
- Meaning: Overseeing the work of subordinates by their superiors. It implies monitoring progress, guiding employees, and ensuring resources are used effectively and efficiently. Primarily carried out by first-line managers (supervisors).
- Importance/Role of a Supervisor:
- Link Pin: Acts as a link between management and workers. Conveys management policies to workers and worker grievances/suggestions to management.
- Maintains Day-to-Day Contact: Maintains direct contact and friendly relations with workers.
- Ensures Performance: Takes responsibility for achieving targets by guiding and instructing workers.
- Provides On-the-Job Training: Guides and trains workers on the job.
- Builds Morale: Motivates workers and builds high morale among them.
- Provides Feedback: Gives feedback on performance and identifies training needs.
- Maintains Discipline: Ensures discipline within the workgroup.
B. Motivation
- Meaning: The process of stimulating people to action to accomplish desired goals. It's about inducing people to act in a desired manner.
- Key Terms:
- Motive: An inner state or desire that energises, activates, or moves behaviour towards goals (e.g., hunger, need for recognition).
- Motivation: The process of stimulating people based on their motives.
- Motivator: The technique used to motivate people (e.g., bonus, promotion, recognition).
- Features of Motivation:
- Internal Feeling: An urge or drive that comes from within an individual.
- Goal-Directed Behaviour: Induces people to behave in a way that helps achieve goals.
- Can be Positive or Negative: Positive (rewards like pay increase, promotion) or Negative (punishments like stopping increments, demotion, threats).
- Complex Process: Human needs are diverse and change over time, making motivation challenging.
- Motivation Process:
Unsatisfied Need -> Tension -> Drives -> Search Behaviour -> Satisfied Need -> Reduction of Tension - Importance of Motivation:
- Improves performance levels of employees.
- Helps change negative or indifferent attitudes to positive attitudes.
- Reduces employee turnover and absenteeism.
- Helps introduce changes smoothly by reducing resistance.
- Helps achieve organisational goals effectively.
- Maslow's Need Hierarchy Theory: (Very Important for Exams)
- Abraham Maslow proposed that human needs form a hierarchy. People are motivated to fulfill basic needs before moving on to higher-level needs.
- Hierarchy of Needs:
- Physiological Needs: Basic survival needs (food, shelter, clothing, water, air). In an organisation: basic salary.
- Safety/Security Needs: Need for physical and emotional security (protection from danger, job security, stability of income). In an organisation: pension plans, job security.
- Affiliation/Belongingness Needs (Social Needs): Need for affection, sense of belonging, acceptance, friendship. In an organisation: cordial relations with colleagues, informal groups.
- Esteem Needs: Need for self-respect, autonomy, status, recognition, attention. In an organisation: job title, praise, recognition awards.
- Self-Actualisation Needs: Highest level – the drive to become what one is capable of becoming. Includes growth, self-fulfillment, achievement of one's potential. In an organisation: challenging job assignments, achievement of goals, autonomy.
- Assumptions: People's behaviour is based on their needs; needs follow a hierarchy; a satisfied need no longer motivates; a person moves to the next higher level only when the lower need is satisfied.
- Relevance: Helps managers understand that different employees are motivated by different needs and tailor motivators accordingly.
- Financial and Non-Financial Incentives:
- Financial Incentives (Measurable in Monetary Terms):
- Pay and Allowances: Salary, dearness allowance, etc. (satisfies basic needs).
- Productivity-Linked Wage Incentives: Higher wages for higher productivity.
- Bonus: Incentive offered over and above wages/salary.
- Profit Sharing: Giving employees a share in the organisation's profits.
- Co-partnership/Stock Option: Employees offered company shares at a set price lower than market price.
- Retirement Benefits: Provident fund, pension, gratuity.
- Perquisites (Perks): Car allowance, housing, medical aid, education for children (often linked to status).
- Non-Financial Incentives (Focus on Psychological, Social, Emotional Factors):
- Status: Rank, authority, responsibility, recognition associated with a job.
- Organisational Climate: Characteristics influencing individual behaviour (autonomy, reward orientation, consideration, risk-taking).
- Career Advancement Opportunity: Providing opportunities for growth and promotion.
- Job Enrichment: Designing jobs with greater variety, requiring higher skills, more autonomy, and providing growth opportunities.
- Employee Recognition Programmes: Acknowledging and appreciating good performance (e.g., congratulating, displaying achievements, awards).
- Job Security: Providing stability about future income and work.
- Employee Participation: Involving employees in decision-making on issues concerning them.
- Employee Empowerment: Giving more autonomy and power to subordinates.
- Financial Incentives (Measurable in Monetary Terms):
C. Leadership
- Meaning: The process of influencing the behaviour of people by making them strive voluntarily towards the achievement of organisational goals. It indicates the ability of an individual to maintain good interpersonal relations with followers and motivate them.
- Features of Leadership:
- Ability to influence others.
- Aims to bring change in the behaviour of others.
- Indicates interpersonal relations between leader and followers.
- Exercised to achieve common goals.
- A continuous process.
- Importance of Leadership:
- Influences employee behaviour positively.
- Helps maintain personal relations and build confidence.
- Plays a key role in introducing necessary changes.
- Handles conflicts effectively.
- Provides training and guidance to subordinates.
- Leadership Styles: (Behavioural pattern exhibited by a leader)
- Autocratic (Authoritarian) Leadership:
- Leader centralises decision-making power.
- Gives orders and expects obedience.
- One-way communication (downward).
- Based on rewards and punishments.
- Suitability: Unskilled/uneducated subordinates, emergency situations, need for quick decisions.
- Pros: Quick decision-making. Cons: Low morale, frustration, potential for low initiative.
- Democratic (Participative) Leadership:
- Leader involves subordinates in decision-making.
- Consults with subordinates, encourages their opinions.
- Two-way communication.
- Leader provides support, not just orders.
- Suitability: Skilled/competent subordinates, goal acceptance is important.
- Pros: High morale, improved job satisfaction, increased creativity. Cons: Time-consuming decisions, leader may be seen as weak if overused.
- Laissez-Faire (Free-Rein) Leadership:
- Leader gives complete freedom to subordinates.
- Group members set their own goals and make decisions.
- Leader provides support and resources only when needed.
- High degree of delegation of authority.
- Suitability: Highly skilled, motivated, self-directed subordinates.
- Pros: High job satisfaction and morale for subordinates, maximum scope for development. Cons: Potential for chaos/confusion without leader guidance, leader may shirk responsibility.
- Autocratic (Authoritarian) Leadership:
D. Communication
- Meaning: The process of exchange of ideas, views, facts, feelings, etc., between two or more persons to reach a common understanding.
- Communication Process (Elements):
- Sender: Person who conveys the message.
- Message: Content of ideas, feelings, suggestions, order.
- Encoding: Converting the message into communication symbols (words, pictures, gestures).
- Media/Channel: Path through which the encoded message is transmitted (face-to-face, phone, internet, letter).
- Decoding: Converting encoded symbols back into meaning by the receiver.
- Receiver: Person who receives the communication.
- Feedback: All actions of the receiver indicating understanding (essential for two-way communication).
- Noise: Any obstruction or hindrance to communication (poor connection, ambiguous symbols, inattention, prejudice).
- Importance of Communication:
- Acts as a basis for coordination.
- Helps in smooth working of the enterprise.
- Acts as a basis for decision-making.
- Increases managerial efficiency.
- Promotes cooperation and industrial peace.
- Establishes effective leadership.
- Boosts morale and provides motivation.
- Formal and Informal Communication:
- Formal Communication:
- Flows through official channels designed in the organisation chart.
- Can be Oral or Written.
- Types based on Direction:
- Vertical: Upward (subordinate to superior) or Downward (superior to subordinate).
- Horizontal (Lateral): Between persons at the same level.
- Communication Networks (Patterns): Single chain, Wheel, Circular, Free flow, Inverted V.
- Advantages: Orderly flow, easy source identification, facilitates control. Disadvantages: Slow, rigid, impersonal, potential for information distortion.
- Informal Communication (Grapevine):
- Takes place without following formal lines; arises out of social interaction.
- Spreads rapidly, sometimes gets distorted (rumours).
- Grapevine Networks: Single strand, Gossip, Probability, Cluster.
- Advantages: Fast, provides social support, can carry useful feedback to managers. Disadvantages: Spreads rumours, unsystematic, difficult to verify information, may work against organisational interests. Managers should leverage the grapevine constructively.
- Formal Communication:
- Barriers to Effective Communication: (Obstacles that distort or block messages)
- Semantic Barriers: Problems with encoding/decoding due to language, words, symbols.
- Badly expressed message: Poor vocabulary, awkward sentences.
- Symbols with different meanings: A word understood differently.
- Faulty translations: Errors in translating from one language to another.
- Unclarified assumptions: Sender assumes receiver knows things they don't.
- Technical jargon: Specialist terms not understood by the receiver.
- Body language and gesture decoding: Mismatch between words and body language.
- Psychological Barriers: Related to the state of mind of sender/receiver.
- Premature evaluation: Judging the message before fully understanding it.
- Lack of attention: Preoccupied mind.
- Loss by transmission and poor retention: Information lost when passed through multiple levels; poor memory.
- Distrust: Lack of trust between sender and receiver hinders acceptance.
- Organisational Barriers: Related to organisational structure, authority, rules.
- Organisational policy: If policy discourages free flow (e.g., highly centralised).
- Rules and regulations: Rigid rules can delay communication.
- Status: Status differences may prevent subordinates from freely expressing opinions to superiors.
- Complexity in organisation structure: Many managerial levels delay and distort communication.
- Organisational facilities: Lack of suggestion boxes, complaint boxes, meetings hinders communication.
- Personal Barriers: Related to personal factors of sender/receiver.
- Fear of challenge to authority: Superiors may withhold information if they fear it reduces their authority.
- Lack of confidence of superior in subordinates: May lead to withholding information.
- Unwillingness to communicate: Subordinates may not communicate upwards if they feel it won't be appreciated or might affect them negatively.
- Lack of proper incentives: No motivation for subordinates to offer suggestions.
- Semantic Barriers: Problems with encoding/decoding due to language, words, symbols.
- Improving Communication Effectiveness (Measures to Overcome Barriers):
- Clarify ideas before communication.
- Communicate according to the needs of the receiver.
- Consult others before communicating.
- Be aware of language, tone, and content.
- Convey things of help and value to listeners.
- Ensure proper feedback.
- Communicate for the present as well as the future.
- Follow up communications.
- Be a good listener.
Remember, Directing is the function that brings the organisation to life. Understanding its elements and how they interact is key to understanding management in action.
Multiple Choice Questions (MCQs) for Practice:
-
Which function of management involves instructing, guiding, counselling, motivating and leading people to achieve organisational objectives?
(a) Planning
(b) Organising
(c) Staffing
(d) Directing -
Which of the following is NOT an element of Directing?
(a) Supervision
(b) Communication
(c) Leadership
(d) Coordination -
According to Maslow's Need Hierarchy Theory, which need arises after the satisfaction of Safety/Security needs?
(a) Physiological Needs
(b) Affiliation/Belongingness Needs
(c) Esteem Needs
(d) Self-Actualisation Needs -
Offering company shares at a price lower than the market price to employees is an example of:
(a) Profit Sharing
(b) Co-partnership/Stock Option
(c) Bonus
(d) Perquisite -
Which leadership style involves the leader giving complete freedom to subordinates to make decisions?
(a) Autocratic
(b) Democratic
(c) Laissez-faire
(d) Paternalistic -
The process of converting the message into communication symbols is known as:
(a) Media
(b) Encoding
(c) Feedback
(d) Decoding -
Communication that takes place without following the formal lines of communication is called:
(a) Formal Communication
(b) Informal Communication (Grapevine)
(c) Upward Communication
(d) Downward Communication -
A barrier to communication arising from different meanings assigned to the same word by sender and receiver is known as:
(a) Psychological Barrier
(b) Organisational Barrier
(c) Semantic Barrier
(d) Personal Barrier -
Which of the following is a Non-Financial Incentive?
(a) Bonus
(b) Perquisites
(c) Job Enrichment
(d) Retirement Benefits -
The directing function flows from _________ to _________ in the organisational hierarchy.
(a) Bottom to Top
(b) Top to Bottom
(c) Horizontal Level
(d) All levels equally
Answer Key:
- (d)
- (d)
- (b)
- (b)
- (c)
- (b)
- (b)
- (c)
- (c)
- (b)
Study these notes thoroughly. Pay special attention to Maslow's theory, leadership styles, types of incentives, and barriers to communication, as these are frequently tested areas. Good luck with your preparation!