Question

Explain significance of principles of management.

Scientific decisions, as significance of principles of management.

Answer 1

The principles used for management of business organisations are called as principles of management. These principles provide guidelines to managers to take decisions. Management principles are formed to guide and influence the behaviour of employees. They focus on improving the overall efficiency of the organisational resources. The significance of the principles of management can be explained with the help of the following points:

1. Provides useful insight to managers:

Principles of management help the manager:

1. In understanding the organisation better
2. In understanding the situations and problems 
3. In finding solutions to various situations and problems

Management principles are based on the experience of various professional people. Managers can use their experience in solving organisation problems by applying the management principles. This type of timely guidance reduces wastage of resources and helps to achieve the organisational goals in an appropriate manner.

2. Understanding social responsibility:

Management principles are not developed only from view point of handling the resources effectively but they guide management in understanding social responsibility of the organisation. This helps the management to focus on providing quality products at reasonable prices, avoiding artificial monopolistic situations in market, fair competition, fair remuneration, change in environment, healthy working place, standard tools and machinery etc.

E.g.: Business organisation should focus on developing ecofriendly products.

3. Scientific decisions:

In business organisation, a scientific decision means systematic or balanced decision. Management principles train the managers to take scientific decisions so that they don’t have to follow the trial and error method every time. With the use of various management principles, managers can analyze various situations and find various alternatives to get desired results.

4. Helpful in efficient utilization of resources:

In every organisation two types of resources are used i.e. physical resources (material, machines, money etc.) and human resources (manpower). The basic function of the management is optimum utilisation of these resources and controlling wastage. Managers use the principles of management to maintain discipline and healthy working environment. It helps in developing cordial relationship between management and employees which increases the efficiency level of employees and also affects the effective administration.

E.g.: Use of standard tools and machinery helps in increasing quality or productivity as well as in increasing level of efficiency of human resources.

5. Encourages Research and Development (R and D):

Management principles enable the managers to bring consistent improvement in them. As a result, managers adopt new trends at the work place automatically. They develop scientific approach towards research and development and growth and development of the organisation. 

E.g.: R & D department always works on finding new techniques in the field of production, finance, marketing, human resources etc.

6. Develops objective approach:

Managers have to take many decisions on daily basis. If they approach every issue subjectively (i.e. from a personal point of view), they may be biased while taking a decision. However, management principles help managers to develop an objective approach which considers factual evidence while making decisions. This helps to make the managers more efficient and decision making becomes smooth. It builds confidence in the minds of the managers.

7. Helps to coordinate and control:

It is difficult to create coordination and cooperation among different employees working in different departments. It is also difficult task for manager to keep control on the performance of all team members. Management principles provide guidelines for better co-ordination and control within the organisation.