NCERT Solutions for Class 12 Business Studies Business Studies I Chapter 7: Directing

Chapter at a glance

Exercises – Very Short Answer Type

Question VSA – Q1

What is informal communication?

Answer

Informal communication is communication that takes place without following the formal lines of communication, through social relationships among employees. It is called the grapevine; it spreads rapidly, but may distort messages.

Communication outside the official channels, arising from social relationships – the grapevine.

Question VSA – Q2

Which style of leadership does not believe in use of power unless it is absolutely essential?

Answer

Laissez-faire (free-rein) leadership – the leader gives subordinates a high degree of independence and does not use power unless absolutely necessary.

Laissez-faire (free-rein) leadership.

Question VSA – Q3

Which element in the communication process involves converting the message into words, symbols, gestures etc.?

Answer

Encoding.

Encoding.

Question VSA – Q4

The workers always try to show their inability when any new work is given to them. They are always unwilling to take up any kind of work. Due to sudden rise in demand a firm wants to meet excess orders. The supervisor is finding it difficult to cope up with the situation. State the element of directing that can help the supervisor in handling the problem.

Answer

Motivation – by providing suitable financial and non-financial incentives, the supervisor can stimulate the workers to willingly take up the extra work.

Motivation.

Exercises – Short Answer Type

Question SA – Q1

What are semantic barriers of communication?

Answer

Semantic barriers are problems in encoding and decoding the message into words or impressions – related to language and meaning:

1. Badly expressed message – poor vocabulary, wrong words, omissions.
2. Symbols with different meanings – a word may have several meanings (e.g. “value”).
3. Faulty translations – wrong translation of messages into another language.
4. Unclarified assumptions – messages with assumptions not stated.
5. Technical jargon – specialist terms not understood by the receiver.
6. Body language and gesture decoding – mismatch between words and gestures.

Semantic barriers arise from language and meaning: badly expressed messages, words with different meanings, faulty translation, unclarified assumptions, technical jargon and misread body language.

Question SA – Q2

Explain the process of motivation with the help of a diagram.

Answer

1. Unsatisfied need – a person feels a need that is not met.
2. Tension – the unsatisfied need creates tension.
3. Drives – tension creates drives (urges) to fulfil the need.
4. Search behaviour – the person searches for ways to satisfy the need.
5. Satisfied need – the need is fulfilled.
6. Reduction of tension – tension disappears; then a new need arises and the cycle continues.

Unsatisfied need → tension → drives → search behaviour → satisfied need → reduction of tension (then a new need starts the cycle again).

Question SA – Q3

State the different networks of grapevine communications.

Answer

1. Single strand – each person communicates to the next in a sequence.
2. Gossip – one person communicates with all others on a non-selective basis.
3. Probability – a person communicates randomly with others, who pass it on randomly.
4. Cluster – a person communicates only with people he trusts; of these, some pass it on to others they trust. (Most popular.)

Single strand, gossip, probability and cluster networks.

Question SA – Q4

Explain any three principles of Directing.

Answer

1. Maximum individual contribution – directing should help every individual contribute to the maximum of his potential, e.g. through effective motivation.
2. Harmony of objectives – directing should reconcile individual objectives (salary, recognition) with organisational objectives (profit, growth).
3. Unity of command – a subordinate should receive instructions from only one superior to avoid confusion.
4. (Also) Managerial communication – instructions should be clearly communicated; use of informal organisation; leadership; follow-through – monitoring whether instructions are carried out.

Maximum individual contribution, harmony of individual and organisational objectives, and unity of command (others: communication, informal organisation, leadership, follow-through).

Question SA – Q5

In an organisation, one of the departmental managers is inflexible and once he takes a decision, he does not like to be contradicted. As a result, employees always feel they are under stress and they take least initiative and fear to express their opinions and problems before the manager. What is the problem in the way authority is being used by the manager?

Answer

The manager follows an autocratic (authoritarian) leadership style – he centralises authority, takes decisions alone and expects strict obedience, without consulting subordinates. This creates stress, kills initiative and blocks upward communication. He should adopt a democratic (participative) style, involving employees in decisions and encouraging them to express their views.

He uses an autocratic leadership style – centralised authority with no participation – causing stress and lack of initiative; a democratic style would be better.

Question SA – Q6

A reputed hostel, GyanPradan provides medical aid and free education to children of its employees. Which incentive is being highlighted here? State its category and name any two more incentives of the same category.

Answer

Incentive: Perquisites (perks)/fringe benefits – medical aid and free education for employees’ children. Category: Financial incentive. Two more financial incentives: bonus, profit sharing (others: pay and allowances, productivity-linked wage incentives, co-partnership/stock options, retirement benefits).

Perquisites/fringe benefits – a financial incentive; other financial incentives include bonus and profit sharing.

Exercises – Long Answer Type

Question LA – Q1

Discuss Maslow’s Need Hierarchy theory of motivation.

Answer

Abraham Maslow said that people’s needs are arranged in a hierarchy, and people are motivated by the lowest unsatisfied need:

1. Basic physiological needs – food, shelter, clothing, sleep; in an organisation, basic salary.
2. Safety/security needs – physical and economic security, job security, stability of income, pension.
3. Affiliation/belonging (social) needs – affection, acceptance, friendship, sense of belonging.
4. Esteem needs – self-respect, autonomy, status, recognition, attention.
5. Self-actualisation needs – becoming what one is capable of: growth, self-fulfilment, achievement of goals.

Assumptions

• People’s behaviour depends on their needs.
• Needs are in a hierarchical order from basic to higher.
• A satisfied need no longer motivates; only the next higher need does.
• A person moves to the next level only when the lower need is satisfied.

Relevance: managers can identify the need level of employees and offer suitable incentives. (Criticism: needs may not always follow a strict order.)

Maslow ranked needs as physiological, safety, social, esteem and self-actualisation; people are motivated by the lowest unsatisfied need, and a satisfied need no longer motivates.

Question LA – Q2

What are the common barriers to effective communication? Suggest measures to overcome them.

Answer

Barriers

1. Semantic – badly expressed message, symbols with different meanings, faulty translation, unclarified assumptions, jargon, misread body language.
2. Psychological/emotional – premature evaluation, lack of attention, loss by transmission and poor retention, distrust.
3. Organisational – organisational policy, rules and regulations, status differences, complexity of structure (many levels), lack of facilities.
4. Personal – fear of challenge to authority, lack of confidence of superior in subordinates, unwillingness to communicate, lack of proper incentives.

Measures to overcome

1. Clarify the ideas before communicating.
2. Communicate according to the needs of the receiver.
3. Consult others before communicating.
4. Be aware of language, tone and content.
5. Convey things of help and value to the listener.
6. Ensure proper feedback.
7. Communicate for the present as well as the future.
8. Follow up communications.
9. Be a good listener.

Barriers are semantic, psychological, organisational and personal; overcome them by clarifying ideas, suiting the receiver, consulting others, minding language and tone, conveying value, getting feedback, following up and listening well.

Question LA – Q3

Explain different financial and non-financial incentives used to motivate employees of a company?

Answer

Financial incentives

1. Pay and allowances – basic salary, dearness allowance, regular increments.
2. Productivity-linked wage incentives – e.g. piece-rate wages.
3. Bonus – extra payment over salary, in cash or kind.
4. Profit sharing – a share in the profits of the organisation.
5. Co-partnership/stock option – shares offered at a lower price, creating ownership feeling.
6. Retirement benefits – provident fund, pension, gratuity.
7. Perquisites – car, housing, medical aid, children’s education.

Non-financial incentives

1. Status – rank, authority, responsibility, prestige.
2. Organisational climate – individual autonomy, reward orientation, consideration for employees.
3. Career advancement opportunity – training, promotion.
4. Job enrichment – more challenging and interesting work.
5. Employee recognition programmes – appreciation, awards, certificates.
6. Job security – stable employment.
7. Employee participation – in decision-making (joint committees, quality circles).
8. Employee empowerment – more autonomy and power.

Financial: pay and allowances, productivity-linked wages, bonus, profit sharing, stock options, retirement benefits and perquisites. Non-financial: status, organisational climate, career advancement, job enrichment, recognition, job security, participation and empowerment.

Question LA – Q4

In an organisation all the employees take things easy and are free to approach anyone for minor queries and problems. This has resulted in everyone talking to each other and thus resulting in inefficiency in the office. It has also resulted in loss of secrecy and confidential information being leaked out. What system do you think the manager should adopt to improve communication?

Answer

The manager should adopt a formal communication system, following the official chain of command (scalar chain):

1. Define clear lines of communication – vertical (upward/downward) and horizontal channels.
2. Use suitable formal networks – single chain, wheel (central authority), etc. – depending on the need.
3. Restrict confidential information to authorised persons.
4. Use written communication (circulars, memos, emails) for important matters, with records.
5. Specify whom to approach for queries (help desk, supervisor).

Benefits: maintains authority and accountability, avoids time wasted in unnecessary talk, ensures secrecy, and improves efficiency. The informal channel may still be used wisely to gauge reactions.

Adopt a formal communication system through the official chain of command, with defined channels and networks, restricted access to confidential information and written records – improving efficiency and secrecy.

Topic checklist

• ☒ Meaning, elements and principles of directing (SA 4)
• ☒ Motivation – process, Maslow, incentives (VSA 4; SA 2, 6; LA 1, 3)
• ☒ Leadership styles (VSA 2; SA 5)
• ☒ Communication – process, formal/informal, barriers (VSA 1, 3; SA 1, 3; LA 2, 4)

Total questions answered: 14 of 14