WBCHSE HS Business Studies flashcards

33 cards. Read the term and the definition here. The deck at the top of this page is optional.

Effectiveness vs efficiency

Effectiveness is completing a task on time to achieve the goal; efficiency is doing it with minimum cost and resources. A firm can be effective but inefficient if it achieves targets wastefully.

Coordination as essence of management

Coordination is not a separate function but the force that unites all functions and levels. It is needed because of growth in size, functional differentiation and specialisation.

Unity of command

Each employee should receive orders from only one superior. Violating it causes confusion, conflicting instructions and divided responsibility, weakening discipline and accountability.

Functional foremanship

Taylor's system of eight specialist bosses: four under a planning incharge (route, instruction card, time and motion, discipline clerks) and four under a production incharge (speed, gang, repair bosses, inspector).

Gang plank

Fayol's shortcut allowing two employees at the same level to communicate directly in an emergency, bypassing the scalar chain, provided superiors are informed afterwards.

Differential piece wage system

Taylor's wage plan paying a higher rate per unit to workers who meet or exceed the standard output and a lower rate to those who fall short, motivating higher efficiency.

Technological environment

The dimension of business environment covering innovations, scientific improvements and the rate of technological change, which can create new products or make existing ones obsolete.

Relative business environment

The feature that business environment differs from country to country and region to region, so the same factor may be favourable in one place and unfavourable in another.

Planning premises

The assumptions about the future environment on which plans are based. They may be internal or external, controllable or uncontrollable, and must be communicated to those implementing the plan.

Policy, procedure and rule

A policy is a general guideline for decisions; a procedure is a chronological sequence of steps; a rule is a rigid specific statement allowing no discretion.

Delegation elements

Delegation involves authority (right to command), responsibility (obligation to perform) and accountability (answerability). Authority and responsibility can be delegated or assigned; accountability cannot be delegated.

Informal organisation

A network of social relationships arising spontaneously among employees, not created by management. It gives social satisfaction and fast communication but may spread rumours.

Vestibule training

Off-the-job training in a duplicate model of the actual workplace, using the same equipment and conditions, so trainees learn skills without risking production or safety.

Aptitude vs proficiency test

An aptitude test measures a candidate's potential to learn a skill; a proficiency or trade test measures the skill already acquired and current competence.

Internal recruitment sources

Filling vacancies from within the organisation through transfer, promotion or recall of ex-employees. It is cheaper and motivating but limits fresh talent and may cause inbreeding.

Maslow's hierarchy

Five needs arranged from lower to higher: physiological, safety, affiliation, esteem and self-actualisation. A satisfied need stops motivating, and higher needs activate after lower ones are met.

Herzberg's two-factor theory

Hygiene factors such as salary, policy and working conditions prevent dissatisfaction but do not motivate. Motivators such as achievement, recognition, responsibility and growth create real satisfaction.

Grapevine communication

An informal, unofficial channel of communication that spreads rapidly through social networks. It is fast and can relieve tension but is often inaccurate and hard to control.

Management by exception

A control principle under which managers attend only to significant deviations from standards and leave minor, routine variations to subordinates, saving time and effort.

Critical point control

A control technique focusing on key result areas that are critical to organisational success rather than on every minor activity, because controlling all activities is neither feasible nor economical.

Budgetary control

A technique of control using budgets that state expected results in quantitative terms for a future period, comparing actual performance with the budget and acting on variances.

Wealth maximisation objective

A financial objective aiming to maximise the market value of equity shares over the long run. It is preferred over profit maximisation because it considers risk and time value of money.

Working capital

The excess of current assets over current liabilities, needed to finance day-to-day operations. It is affected by the nature of business, scale, business cycle and credit policy.

Financial leverage

The proportion of debt in the capital structure. Higher leverage raises return on equity when earnings are good but magnifies losses and increases financial risk.

Treasury bills

Short-term money market instruments issued by the government at a discount and redeemed at face value, used to raise funds and manage short-term liquidity.

Primary market methods

Ways of issuing new securities: offer through prospectus, offer for sale, private placement, rights issue and e-IPO. Funds go directly to the issuing company.

SEBI functions

The Indian securities market regulator performs protective functions (investor safety), regulatory functions (rules for intermediaries) and developmental functions (market growth and education).

Brand name vs brand mark

A brand name is the part of a brand that can be spoken, such as a word or letters. A brand mark is the part that can be recognised but not spoken, such as a symbol or design.

Penetration pricing

A pricing method setting a low introductory price to attract buyers and capture a large market share quickly, later raising the price once the product is established.

Advertising vs publicity

Advertising is paid, impersonal promotion by an identified sponsor. Publicity is unpaid, unsponsored mention of a product or firm in the media, so the sponsor does not control it.

Consumer rights

Six rights under the Consumer Protection Act: safety, to be informed, to choose, to be heard, to seek redressal and to consumer education. These protect buyers of goods and services.

Three-tier redressal machinery

Consumer commissions at District (up to Rs 50 lakh), State (above Rs 50 lakh to Rs 2 crore) and National (above Rs 2 crore) levels, based on consideration paid.

Product liability

Liability of a manufacturer, service provider or seller to compensate a consumer for harm caused by defective goods or deficient services, as provided under the Consumer Protection Act, 2019.