Problems or breakdowns in communication resulting in incomplete or wrong understanding are called barriers to communication.

Types of Barriers to communication:

semantic barriers, psychological barriers, organisational barriers, and personal barriers. These are briefly discussed below:

Semantic barriers:

Semantics is  the branch of linguistics dealing with the meaning of words and sentences. Semantic barriers are related to problems and obstructions in the process of encoding and decoding of message into words or impressions.

Main semantic barriers are:

(a) Badly expressed message:

When intended meaning is not conveyed by a manager to his subordinates, may be on account of inadequate vocabulary, usage of wrong words, omission of needed words etc.

(b) Symbols with different meanings:

A word may have several meanings. Receiver has to understand the meaning for the word used by communicator, in the same sense. Wrong perception leads to communication problems.

(c) Faulty translations:

Sometimes the communication originally drafted in one language needs to be translated to the language understandable to the other party . If the translator is not proficient with both the languages, mistakes may occur causing different meanings .

(d) Unclarified assumptions:

Some communications may have certain assumptions which are subject to different interpretations.

(e) Technical jargon:

It is common that specialists use technical vocabulary while explaining to persons who  are not specialists in the concerned field. Therefore, they may not understand the actual meaning of many such words.

(f) Body language and gesture decoding:

The body movement and gestures of communicator matters a lot in conveying the message. If there is no match between what is said and what is expressed in body movements, communications may result in wrong conclusions.

Psychological barriers:

Psychological barriers are the barriers due to emotional or psychological factors i.e. the state of mind of both the communicator and communicatee.

For example, a worried person cannot communicate properly and an angry receiver cannot understand the real meaning of message.

Main psychological barriers are:

(a) Premature evaluation:

Sometimes people draw conclusions of the message before the sender completes his message. Such premature evaluation may be due to pre-conceived notions or prejudices against the communication.

(b) Lack of attention:

The preoccupied mind of receiver and the resultant non-listening of message acts as a major psychological barrier.

(c) Loss by transmission and poor retention:

When communication passes through various levels, there is a problem of incomplete or wrong transmission of information.

Poor retention is another problem as many people cannot retain the information for a long time if they are inattentive or not interested.

(d) Distrust:

Lack of trust between communicator and communicate acts as a barrier. If the parties do not believe each other, they cannot understand each other's message in the same sense.

Organisational barriers:

These factors are related to organisation structure, authority relationships, rules and regulations etc.

Some of such organisational barriers are:

(a) Organisational policy:

Effectiveness of communication is adversely affected If the organisational policy, explicit or implicit, is not supportive to free flow of communication.

For example, in a centralised organisation, people may not be encouraged to have free communication.

(b) Rules and regulations:

Rigid rules and complicated procedures can be a problem in communication. Communications  through prescribed channel may result in delays.

(c) Status:

Status of superior can create psychological distance between him and his subordinates. A status conscious manager also does not allow his subordinates to express their feelings freely.

(d) Complexity in organisation structure:

In an organisation where there are number of managerial levels, communication gets delayed and distorted as number of filtering points are more.

(e) Organisational facilities:

Facilities like frequent meetings, suggestion box, complaint box, social and cultural gathering, transparency in operations etc., will encourage free flow of communication. Lack of these facilities may create communication problems.

Personal barriers:

Personal barriers are the personal factors of both sender and receiver that can affect  effectiveness of communication.

Main personal barriers are:

(a) Fear of challenge to authority:

If a superior feels that a particular communication may adversely affect his authority, he or she is likely to withhold or suppress such communication.

(b) Lack of confidence of superior on his subordinates:

If superiors do not have confidence on the competency of their subordinates, they cannot seek their advice or opinions.

(c) Lack of willingness to communicate:

Sometimes, subordinates are not prepared to communicate with their superiors, if they perceive that it can adversely affect their  interests.

(d) Lack of proper incentives:

If there is no motivation or incentive for communication, subordinates may not take initiative to communicate .e.g. if there is no reward or appreciation for a good suggestion, the subordinates may not be willing to offer useful suggestions.

Improving Communication Effectiveness

Organisations should adopt suitable measures to overcome the barriers and improve communication effectiveness. Some such measures  are:

1. Clarify the ideas before communication:

The problem to be communicated to subordinates should be clear in all its perspective to the superior himself. The entire problem should be studied in depth, and clearly conveyed to subordinates.

2. Communicate according to the needs of receiver:

The level of the education and understanding levels of subordinates should be absolutely clear to the communicator so that he can adjust his communication according to the subordinates.

3. Consult others before communicating:

Before actually communicating the message, it is better to involve others .Participation and involvement of subordinates help to gain ready acceptance and willing cooperation of subordinates.

4. Be aware of languages, tone and content of message:

The contents of the message, tone and language to be used etc. should be carefully considered before making communication. The message should be communicated in stimulating to evoke desired response.

5. Convey things of help and value to listeners:

It is better for the sender to know the interests and needs of the receiver. If the message relates directly or indirectly to such interests and needs it certainly evokes response from communicate.

6. Ensure proper feedback:

The communicator should ensure the success of communication by asking questions regarding the message conveyed and the receiver be encouraged to respond .

7. Communicate for present as well as future:

Generally, communication is needed to meet the existing commitments to maintain consistency, the communication should aim at future goals of the enterprise also.

8. Follow up communications:

There should be regular follow up and review on the instructions given to subordinates. Such follow up measures help in removing hurdles if any in implementing the instructions..

9. Be a good listener:

Manager should be a good listener. Patient and attentive listening solves half of the problems. Managers should also give indications of their interest in listening to their subordinates.

Communication as Element of Direction

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Directing

1. complex managerial function
2. includes supervision, motivation, communication and leading

Features of Directing

1. Initiates action
2. At every level of management(pervasive)
3. Continuous process
4. Flows from top to bottom

Importance of Directing

1. Achieving Goal
2. Integrate employees' efforts
3. Fuller utilization of employees' capabilities
4. Introducing changes
5. Stability in organization

 Principles of Directing:

Related to purpose of Directing and Directing process

1. Maximum Individual Contribution
2. Harmony of Objectives
3. Unity of Command
4. Appropriateness of directing techniques
5. Managerial communication
6. Use of informal communication
7. Leadership
8. Follow through

Elements of Directing

1. Supervision
2. Motivation
3. Leadership
4. Communication

Supervision

1. Element of directing
2. Function performed by supervisors
3. Process of overseeing and guiding the workers
4. For achieving the targets

Importance of Supervision:

1. Friendly relations with workers.
2. Link between workers and management.
3. Maintains harmony among workers.
4. Employee motivation
5. Provides good on-the-job training
6. Employee Morale
7. Proper feedback

Motive:

An inner state that activates and directs behaviour towards goals.

Motivators:

The technique used to motivate.

Motivation (Features)

1. Element of directing
2. Stimulating people to action
3. Creating Internal feeling
4. Complex process
5. Positive or negative

Motivation process

1. Unsatisfied need
2. Tension
3. Drives
4. Search Behaviour
5. Satisfied needs
6. Reduction of Tension

Importance of Motivation

1. Improves performance level of employee
2. Turns negative to positive attitude
3. Reduces employee turnover
4. Reduces absenteeism
5. Introducing change smoothly

Maslow’s Need Hierarchy Theory of Motivation:

• Based on human needs.
• Within every human being, there exists a hierarchy of five needs.

1. Basic Physiological Needs:

Primary needs. Hunger, thirst, shelter, sleep and sex are examples.

2. Safety/Security Needs:

Security and protection from physical and emotional harm.

Examples: job security, stability of income, Pension plans etc.,

3. Affiliation/Belonging Needs:

Affection, sense of belongingness, acceptance and friendship.

4. Esteem Needs:

Self-respect, autonomy, status, recognition and attention.

5. Self Actualisation Needs:

The highest level, the drive to become what one is capable of.

Assumptions of Maslow’s Theory:

1. People’s behaviour is based on their needs.
2. People’s needs are in hierarchical order.
3. A satisfied need can no longer motivate a person.
4. Next need is tried only after the lower need is satisfied.

Financial Incentives:

1. Pay & allowances
2. Productivity linked with wage system
3. Bonus
4. Profit sharing
5. Co partnership/stock option
6. Retirement benefits
7. Perquisites

Non-Financial Incentives:

1. Status
2. Organisational Climate
3. Career advancement
4. Job enrichment
5. Employee Recognition
6. Job security
7. Employee Participation
8. Employee Empowerment

Directing Keywords and Brief Notes

Leadership:

Influencing the behaviour of people to work willingly.

Features of Leadership

1. Ability to influence others.
2. Interpersonal relations.
3. Focus on common goals.
4. Continuous process.

Importance of Leadership

1. Influences others for the benefit of organization.
2. Creates congenial work environment.
3. Inspires people to accept changes.
4. Handles conflicts effectively.
5. Training to subordinates.

Leadership styles

1. Autocratic (Authoritarian) leader
2. Democratic (Participative) leader
3. Laissez faire (Free-Rein) leader

Autocratic (Authoritarian) leader

1. Boss Centered Approach.
2. Only one-way communication.
3. Leader gives orders and expects subordinates to obey the orders.
4. Leader is dogmatic i.e. does not change his views.
5. Assumption - Both reward and punishment can be given.
6. Only boss (Supervisor) is responsible for production on time.
7. Quick decision making.
8. Decision after others’ views.

Democratic (Participative) leader

1. Group Centered Approach.
2. Leader develops action plans.
3. Decision in consultation with subordinates.
4. Encourages participation of subordinates.
5. Assumption - People perform best if they have set their own objectives.
6. Respect others’ opinion and support subordinates.
7. More control by using forces within the group.

Laissez faire (Free-Rein) leader

1. Subordinate Centered Approach
2. Leader does not believe in the use of power unless essential.
3. High degree of independence to subordinates.
4. Subordinates work on their own tasks and solve issues themselves.
5. Manager only supports and provides required information to them.
6. Subordinate assumes responsibility for his work.

Directing Keywords and Brief Notes

Communication:

• Process of transmission or exchange.
• Ideas, views, facts, feelings, message, information or instructions
• Between two or more persons.
• To reach common understanding.
• Oral, written, gestural or any other audio-visual way.

Elements of Communication Process:

1. Source/sender/Communicator
2. Encoding
3. Channel
4. Receiver/Communicatee
5. Decoding
6. Feedback

Importance of Communication

1. Acts as basis of coordination
2. Helps in smooth working of an enterprise
3. Acts as basis of decision making
4. Increases managerial efficiency
5. Promotes cooperation and industrial peace
6. Establishes effective leadership
7. Boosts morale and provides motivation

Formal communication

• Official communication
• Generally written

Types of Formal Communication

1. Downward
2. Upward
3. Horizontal
4. Diagonal

Merits of Formal Communication

1. Systematic
2. Easy to fix responsibility
3. Helps in control

Demerits of Formal Communication

1. Delayed information
2. Impersonal manner

Informal communication

• Social and friendly interactions.
• Also called grapevine.
• Because no fixed source.

Merits of Informal Communication

1. Friendly relations
2. Fast
3. Emotional relief to employees

Demerits of Informal Communication

1. Leakage and spoilage of information
2. Spreads rumours

Barriers of Communication

1. Semantic barriers
2. Psychological barriers
3. Organizational barriers
4. Personal barriers

Semantic barriers

• Branch of linguistics dealing with meaning of words and sentences.
• Problems in the process of encoding and decoding of message into words.

1. Badly expressed Message

Inadequate vocabulary, Usage of wrong words, Omission of needed words.

2. Symbols with different meanings

Word having several meanings

3. Faulty translation

Difficulty in understanding language.

4. Unclarified assumptions

Assumptions having different interpretations.

5. Technical jargon

Use of technical words

6. Body language and gesture decoding

Body movement and gestures wrongly perceived.

Psychological barriers

Due to emotional factors (worry, anger, confusion)

1. Premature evaluation

Evaluate message before listening complete message, pre-conceived notions or prejudices.

2. Lack of attention

Pre-occupied mind of receiver, non-listening.

3. Loss by transmission and poor retention

Communication passing through various levels

4. Distrust

Lack of mutual trust between both parties

Organisational barriers

Factors related to org. structure, Authority relationships, Rules and regulations.

1. Organizational policy

Highly centralised pattern in an org. makes communication difficult.

2. Rules and regulations

Prescribed channel may result in delayed communication.

3. Status

Psychological distance b/w sender and receiver.

4. Complexity in organizational structure

Delayed and distorted due to large number of filtering points.

5. Organizational facilities

Lack of frequent meetings, Suggestion box, Complaint box, Social-cultural gathering, Transparency in operations etc.

Personal barriers

Personal factors of both sender and receiver.

1. Fear of challenge to authority

Adverse effect on authority.

2. Lack of confidence of superior on his subordinates

Lack of confidence on competency of his subordinates.

3. Unwillingness to communicate

Adverse effect on their interests.

4. Lack of proper incentives

Employees lack initiative due to no motivation or no incentive.

Measures to Improve Communication

1. Clarity of message.
2. Communicate according to the need of receiver.
3. Consult other to develop plan for communication.
4. Beware of language, content and tone.
5. Communicate thing of value to others.
6. Ensure proper feedback.
7. Connect present with future.
8. Follow up communication.
9. Be a good listener.

Check your understanding

MCQs

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Learning Games and Activities in Business Studies Class 12

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Financial Incentives:

Financial incentives are the incentives which are in direct monetary form or measurable in monetary term and serve to motivate people for better performance. These can be provided on individual or group basis.

Financial incentives can be used to satisfy physical needs of daily life and social needs.

The financial incentives mostly used in organisations are:

1. Pay and allowances:

For every employee, salary is the basic monetary incentive. It includes basic pay, dearness and other allowances, regular increments in the pay and allowances from time-to-time sometimes linked to performance.

2. Productivity linked wage incentives:

There are various wage incentive plans which aim at linking payment of wages to increase in productivity at individual or group level.

3. Bonus:

Bonus is an incentive offered over and above the wages or salary to the employees.

4. Profit Sharing:

Profit sharing means to provide a share to employees in the profits of the organisation. This serves to motivate the employees to improve their performance and contribute to increase in profits.

5. Co-partnership / Stock option:

Under these incentive schemes, employees are offered company shares at a set price which is lower than market price. The allotment of shares creates a feeling of ownership to the employees.

In Infosys the scheme of stock option has been implemented as a part of managerial compensation.

6. Retirement Benefits:

Several retirement benefits such as provident fund, pension, and gratuity act as incentives for in-service employees, by making a promise to provide them financial security after their retirement.

7. Perquisites:

In many companies, perquisites and fringe benefits are offered such as car allowance, housing, medical aid, and education to the children etc., over and above the salary.

Non-Financial Incentives:

Psychological, social and emotional needs of individuals are satisfied by not by money alone but by providing them with non-financial incentives.

Sometimes, monetary aspect may be involved in non-financial incentives as well.

Example: if an individual gets promotion in the organisation, it satisfies him psychologically more as he gets a feeling of elevation, increase in status, increase in authority, challenge in the job etc., Though promotion involves payment of extra money, non-monetary aspects over-ride monetary aspects.

Common non-monetary incentives:

1. Status:

In the organizational context, status means ranking of positions in the organisation. It includes authority, responsibility, rewards, recognition, perquisites and prestige of job of an employee.

Psychological, social and esteem needs of an individual are satisfied by status given to their job.

2. Organisational Climate:

Organisational climate indicates the special characteristics of an organisation such as individual autonomy, reward orientation, consideration to employees etc. These characteristics influence the behaviour of individuals in the organisation.

3. Career Advancement Opportunity:

Every individual wants to improve their skills and be promoted to the higher level in the organisation. Appropriate skill development programmes, and sound promotion policy will help employees to achieve promotion which works as a tonic and encourages employees to exhibit improved performance.

4. Job Enrichment:

Job enrichment means jobs including greater variety of work content that requires higher level of knowledge and skill; giving workers more autonomy and responsibility; and providing them opportunity for personal growth and a meaningful work experience.

5. Employee Recognition programmes:

Need for evaluation of their work and due recognition are what most of the employees want. Recognition means acknowledgment with a show of appreciation.

Some examples of employee recognition are:

• Congratulating the employee for good performance.
• Displaying on the notice board or in company newsletter about the achievement of employee.
• Installing award or certificate for best performance.
• Distributing mementos, complimentary gifts like T-shirts, diaries, pens etc. in recognition of employee services.
• Rewarding an employee for giving valuable suggestions.

6. Job security:

Employees want certain stability about future income and work so that they do not feel worried and work with greater zeal. However, there is one negative aspect of job security. When people feel that they are not likely to lose their jobs, they may become lethargic.

7. Employee participation:

It means involving employees in decision making of the issues related to them. In many companies, these programmes are in practice in the form of joint management committees, work committees, canteen committees etc.,

8. Employee Empowerment:

Empowerment means giving more autonomy and powers to subordinates. It makes people feel that their jobs are important. This feeling contributes positively to the use of skills and talents in the job performance.

Leadership

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MCQs to Revise Business Studies Class 12

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Abraham H. Maslow was a well-known Psychologist. He published the elements theory of motivation in 1943, which focuses on the needs as the basis for motivation. His theory is widely recognised and appreciated.

Maslow's theory was based on human needs. He felt that within every human being, there exists a hierarchy of five needs. These are:

1. Basic/Physiological Needs:

These needs are most basic and primary needs. In the organisational context, basic salary helps to satisfy these needs.

Examples:  Hunger, thirst, shelter, sleep and sex etc.

2. Safety/Security Needs:

The needs that provide security and protection from physical and emotional harm, are called safety/ security needs.

Examples: job security, stability of income, pension plans etc.

3. Affiliation/Belonging Needs:

Also called social needs, these needs refer to affection, sense of belongingness, acceptance and friendship.

4. Esteem Needs:

Esteem Needs include factors such as self-respect, autonomy status, recognition and attention.

Examples: desire to own a costly car, desire to have dinner in a costly restaurant etc.

5. Self Actualisation Needs:

It is the highest level of need in the hierarchy. Self Actualisation Needs refer to the drive to become what one is capable of becoming. These needs include growth, self- fulfilment and achievement of goals.

Example: mission to eradicate poverty in a particular city/village.

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Maslow's Theory of Motivation - Assumptions

Maslow’s theory is based on the following assumptions:

1. Need directs human behaviour:

People’s behaviour is based on their needs. Satisfaction of such needs influences their behaviour.

2. Hierarchical order of needs:

People’s needs are in hierarchical order, starting from basic needs to other higher-level needs. Needs are satisfied one after the previous type.

3. No motivation without additional satisfaction:

A satisfied need can no longer motivate a person; only next higher-level need can motivate him.

4. Sequence of needs:

A person moves to the next higher level of the hierarchy only when the lower need is satisfied.

Maslow's Theory of Motivation - Criticism:

Maslow's theory is criticised due to these propositions:

1. Classification of needs - Some experts say that all human needs cannot be precisely classified as done by Maslow.
2. Hierarchy of needs - All the five needs given by him cannot fall under strict categories and satisfied in that order.

But this theory is still relevant because needs, no matter how they are classified, are important to understand the behaviour. It helps managers to realise that need level of employees should be identified to provide motivation to them.

Check Your Understanding

Financial and Non-Financial Incentives

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Leadership is the process of influencing the behaviour of people by making them strive voluntarily towards achievement of organisational goals.

It is the ability of an individual to maintain good interpersonal relations with followers and motivate them to contribute towards achievement of organisational objectives.

Features of leadership:

Following are the important features of leadership:

1. Indicates ability of an individual to influence others.
2. Tries to bring behavioural change in others.
3. Indicates interpersonal relations between leaders and followers.
4. It is exercised to achieve common goals of the
5. Leadership is a continuous process.

An individual possessing attributes of leadership is known as leader.

Good leadership requires good leader–follower relationship.

The success of an organisation is attributed to the leader, but many followers related factors like – their skills, knowledge, commitment, willingness to cooperate, team spirit etc., are equally important to make a person an effective leader. Therefore, both leader and follower play key role in leadership process.

Importance of Leadership:

Leadership is a key factor in making any organisation successful. As mentioned by Stephen Covey, a famous management consultant, "Managers are important but leaders are vital for lasting organizational success". The importance of leadership can be understood from the following benefits to the organisation:

1. Brings behavioral change in people:
   Leadership brings positive behavioural change in people and makes them positively contribute their best efforts to the organisation. Good leaders always produce good results through their followers.

2. Creates congenial work environment:

A leader maintains personal relations and helps followers in fulfilling their needs. He provides them confidence, support and encouragement, thus creates congenial work environment.

3. Helps in making desired changes:

Leader plays an important role in bringing desirable changes in the organisation. He persuades, clarifies and inspires people to accept changes. Thus, he helps to bring changes without much problem.

4. Conflict resolution:

A good leader is in a very good position to settle conflicts effectively as he not only allows his followers to speak their feelings and disagreement but also persuades them by giving suitable clarifications.

5. Training to subordinates:

Leader provides training to his subordinates. A good leader always builds up his successor and helps in smooth succession process.

Qualities of Good Leader:

Some of the leadership qualities are:

1. Physical features:

Physical features like height, weight, health, appearance determine the physical personality of an individual. Good physical personality attracts people, and his health and endurance help a leader to work hard that inspires others to work more.

2. Knowledge:

A good leader should have required knowledge and competence, in his relevant field. Only then he can instruct subordinates correctly and influence them.

3. Integrity:

A leader should possess high level of integrity and honesty. Only by being honest and firm believer of ethics and values, he can inspire to do so.

4. Initiative:

A leader should have courage and initiative. He should not wait for opportunities come to his way, rather he should grab the opportunity and use it to the advantage of organisation.

5. Communication skills:

A leader should be a good communicator as well as a good communicatee. He should be able to clearly explain his ideas and make others understand his ideas. He should be not only good speaker but a good listener, teacher, counsellor and persuader.

6. Motivation skills:

A leader should be an effective motivator. He should understand the needs of people and motivate them through satisfying their needs.

7. Self Confidence:

A leader should have high level of self-confidence. He should not lose his confidence even in most difficult times. In fact, if the leader lacks self-confidence, he cannot create confidence in his followers.

8. Decisiveness:

Leader should be capable of taking timely and correct decisions. Once he is convinced about a fact, he should be firm and should not change opinions frequently.

9. Social skills:

To be of strong effective personality, a leader should be sociable and friendly with his colleagues and followers. He should understand people and maintain good human relations with them.

However, all good leaders may not necessarily possess all the qualities of a good leader. It is not possible for any individual to have all the qualities. But a person possessing such qualities definitely helps a person in becoming a good leader.

Check Your Understanding

Types of Leadership Style

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Motivation means inducement to do something i.e. the process of making subordinates to act in a desired manner in order to achieve organisational goals.

Three interrelated terms — motive, motivation and motivators.

Motive:

A motive is an inner state that activates and directs a human behaviour towards goals.

Motives arise out of the needs of individuals non-fulfillment of which causes restlessness whereas  realisation of that motive reduces such restlessness.

Some motives are – hunger, thirst, security, affiliation, need for comfort, recognition etc.,

Motivation:

Motivation is the process of stimulating people to action to accomplish desired goals. Motivation depends upon satisfying needs of people.

Motivators:

Motivator is the technique used to motivate people in an organisation. Different motivators used are pay, bonus, promotion, recognition, praise, responsibility etc.

Features

1. An Internal feeling: The human urges, drives, desires, aspirations or needs are internal that influence human behaviour.

Example: Urge or desire to possess a car, own house, reputation in the society. These urges are

internal to an individual.

2. Results in goal directed behaviour:

Motivation results in changing the human behaviour to achieve certain goals.

Example: An employee may be given promotion in the job with the objective of improving his performance. If the employee is interested in promotion, he will definitely change his behaviour to improve performance.

3. It can be positive or negative:

Positive motivation provides positive rewards like increase in pay, promotion, recognition etc. Negative motivation uses negative means like punishment, stopping increments, threatening etc.

Generally positive motivation is used. Negative motivation is used only when positive motivation fails.

4. A complex process

There are individual differences in employees due to sex, study, experience, region, religion, family etc. resulting in difference of their expectations, perceptions and reactions. Same motivators cannot be used for all employees.

Motivation Process:

Motivation process is based on human needs.

An unsatisfied need of an individual creates tension which stimulates his or her drives. These drives generate a search  behaviour to satisfy such need. If such need is satisfied, the individual is relieved of tension.

unsatisfied need -> tension -> drives -> search -> need is satisfied -> relieved of tension.

Importance

It is important as it helps to identify and satisfy the needs of employees that results in improvement of their performance. The importance of motivation can be understood from its following benefits:

1. Improvement in levels of performance:

When employees needs are satisfied, they put in their best efforts and energies in their work which helps to improve their performance that results in the improvement of organisation performance.

2. Positive change in attitudes:

By providing suitable rewards, supervisor gives positive encouragement and praise for the good work done by the employees. This way the workers are likely to develop positive attitude towards the work for the work they earlier dislike.

3. Reduction in employee turnover:

Lack of motivation results in many employees leaving the organisation. High rate of turnover makes it necessary to make new recruitment and training resulting in need of additional requirement of time, effort and money. Thus, it helps in reduction of employee turnover which saves the cost of new recruitment and training.

4. Reduction in absenteeism:

Bad working conditions, inadequate rewards, lack of recognition, poor relations with supervisors and colleagues etc. are some important reasons for absenteeism but all these problems can become minor with the help of motivation making the work  pleasant and workers regular at work.

5. Reduction in people resistance:

It helps in introducing the changes smoothly without much resistance from people. When manager convinces his subordinates that proposed changes will bring additional rewards for them, they readily accept the change.

Types of Incentives

Check Your Understanding

MCQs Based Commerce Quizzes

Learning Games and Activities in Business Studies Class 12

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Firstly, it is an element of directing.

Secondly, it is a function performed by supervisors in the organizational hierarchy.

Supervision as an element of directing:

Every manager supervises his/her subordinates. Supervision is the process of guiding the efforts of employees and other resources to accomplish the desired objectives. It means overseeing the activities of the subordinates and giving them instructions to ensure optimum utilisation of resources and achievement of work targets.

Supervision as a function performed by supervisor:

Supervision is also a function performed by the supervisor, the lowest managerial position in the organisation hierarchy (at the operative level) which is immediately above the worker. He is directly related with workers who are responsible for ultimate achievement of goals.

Importance of Supervision

 The importance of supervision can be understood from multiple roles performed by a supervisor. These are explained below:

1. As a guide, friend and philosopher:

Supervisor maintains day-to-day contact and maintains friendly relations with workers. A good supervisor acts as a guide, friend and philosopher to the workers.

2. As a link between workers and management:

Supervisor acts as a link between workers and management. He conveys management ideas to the workers as well as workers' problems to the management. His role helps to avoid misunderstandings and conflicts between management and workers.

3. Maintaining group unity:

Supervisor plays a key role in maintaining group unity among workers placed under his control. He helps in resolving the internal differences and maintains harmony among workers.

4. Ensuring performance of work:

Supervisor ensures performance of work according to the targets set. He not only takes the responsibility for completion of tasks but also motivates his workers effectively.

5. Training to the workers:

Supervisor can provide good on-the-job training to the workers and employees. A skilled and knowledgeable supervisor is in a very good position to build efficient team of workers.

6. Leadership role:

Supervisory leadership plays an important role in influencing the workers. A supervisor with good leadership qualities can boost the morale of workers and improve their performance.

     7. Solution to worker problems:

A good supervisor analyses the work performed and gives feedback to the workers. He solves their problems and suggests ways to improve their work skills.

Motivation

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Leadership style refers to the approach and methods a leader uses to guide, motivate, and manage their team. It encompasses the way decisions are made, how tasks are delegated, and the level of collaboration and communication within the group.

Each leadership style has its strengths and weaknesses and can be effective depending on the situation and team dynamics.

Types of Leadership Styles

1. Autocratic leadership style:

If the decision-making power is concentrated in the hands of the leader, it is known as autocratic leadership style. There is no participation by subordinates. The leader has full authority and assumes full responsibility. He dictates what to do and how to do and doesn't take any advice and suggestions from followers.

He expects the workers to follow their orders and tolerate no deviation from their order.

Features:

1. He makes his own decisions, and he doesn’t take any advice of others.
2. Reward and punishment are exercised by him very strictly.
3. There is only one way communication in order to maintain the position.
4. An autocratic leader describes each job in detail to be completed by the followers.

Advantages:

1. It is useful in emergency situations.
2. Gives the best results If the workers are untrained and unorganized.
3. It is useful when quick decision-making is required.

Disadvantages:

1. Followers are not involved in the process of decision making.
2. The morale of employees becomes low.
3. No chance of employee development using creative ideas.
4. There is no chance of two-way communication.
5. The employees perform the work with negative motivation.

2. Democratic leadership style:

If the authority and decision-making power are decentralized in subordinates is known, it is called democratic leadership style. The leader delegates authority and provides responsibility even to the followers.

Followers are involved in decision making process. He takes advice and suggestions of other people.

Features:

1. A democratic leader delegates the responsibility to the employees.
2. All subordinates in take part in decision making process.
3. Followers are given importance, giving them job-satisfaction.
4. Results are easily achieved with reasonable freedom to employees in work.

Advantages:

1. There is cooperation among employees, giving them job-satisfaction.
2. It helps in increasing in productivity of employees by increasing their morale.
3. Involvement of all make decision making a better process.
4. There are chances of personal growth of employees.

 Disadvantages:

1. Makes decision making a time-consuming process.
2. It is not suitable for untrained subordinates.
3. A leader should really be a capable person. 

3. Free rein leadership style:

When all the authority and responsibility are delegated to the subordinates, it is known as Free rein leadership style. It is also called Laissez Fair style. The free rein leader doesn’t use the power and leaves the power to the subordinates.

This leadership style is very useful when group members are intelligent and fully aware of their roles and responsibilities.

Features:

1. Subordinates have complete freedom in decision making.
2. The subordinates are self-directed, self-motivated and self-controlled.
3. The leader doesn’t interfere in making planning and policies.

Advantages:

1. The employees are free in decision making, so feel more satisfied.
2. It increases the morale of employees, that results in increasing their productivity.
3. This style utilises full creativity and potential of subordinate, leading to their personal development.

Disadvantages:

1. Leader becomes lethargic.
2. Sometime the subordinates are not capable.

Directing – Keywords and Brief Notes

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Communication

The word communication has been derived from the Latin word ‘communis’ which means ‘common’ which consequently implies common understanding.

"Communication is a process of exchange of ideas, views, facts, feelings etc., between two or more people to create common understanding."

"Communication refers to the process by which a person (known as sender) transmits information or messages to another person (known as receiver)."

The purpose of communication in organisation is to convey orders, instructions, or information so as to bring desired changes in the performance and or the attitude of employees.

Communication Element of Direction

Elements of Communication Process

Communication is a process that involves various steps also called its elements like source, encoding, media/channel, receiver, decoding, noise and feedback etc. as explained below:

1. Sender/communicator:

Sender is the person who conveys his thoughts or ideas to the receiver. The sender is source of communication.

2. Message/subject matter:

It is the content of ideas, feelings, suggestions, order etc., that is to be communicated.

3. Encoding:

It is the process of converting the message into communication symbols such as words, pictures, gestures etc.,

4. Media:

It is the path through which encoded message is transmitted to receiver. The channel may be in written form, face to face, phone, call, internet etc.,

5. Decoding:

It is the process of converting encoded symbols of the sender to understand the message of the sender.

6. Receiver/communicatee:

He is the person who receives communication of the sender.

7. Feedback:

It includes all those actions of receiver indicating that he has received and understood message of sender.

8. Noise:

Noise means some obstruction or hindrance to communication. This hindrance may be caused to sender, message or receiver.

Some examples of noise are:

(a) Ambiguous symbols that lead to faulty encoding.

(b) A poor telephone connection.

(c) An inattentive receiver.

(d) Faulty decoding (to give wrong meaning to message).

(e) Prejudices obstructing the poor understanding of message.

(f) Gestures and postures that may distort the message.

Communication Element of Direction

Importance of Communication

Communication results in the consumption of 90 percent time of a manager in communicating and serves as the lubricant in the management process.

The importance of communication can be understood from the following:

1. Basis of coordination:

Communication acts as basis of coordination. It provides coordination among departments, activities and persons in the organisation by explaining about organisational goals, the mode of their achievement and inter relationships between different individuals etc.

2. Smooth working of an enterprise:

Communication helps in smooth working of an enterprise by facilitating organizational interactions and by bringing coordination into the human and physical elements of an organisation . When communication stops, organized activity ceases to exist.

3. Acts as basis of decision making:

Communication provides needed information for decision making. In its absence, it may not be possible for the managers to take any meaningful decision.

4. Increases managerial efficiency:

Communication facilitates effective performance of managerial functions like conveying the goals and targets, issuing instructions, allocating jobs and responsibilities and looking after the performance of subordinates.

5. Promotes cooperation and industrial peace:

The two-way communication promotes cooperation and mutual understanding between the management and workers that makes all the actions of a good management possible and fruitful.

6. Establishes effective leadership:

Communication serves as basis of leadership. Effective communication helps to influence subordinates. While influencing people, leader should possess good communication skills.

7. Boosts morale and provides motivation:

An efficient system of communication enables management to motivate, influence and satisfy the subordinates on the one hand and helps workers in adjusting with their physical and social aspects of work.

Communication is the basis of participative and democratic pattern of management.

Communication Element of Direction

Types of Communication

Formal and Informal Communication

(On the basis of channel used)

The path through which information flows is called channel of communication.

On the basis of channel used, communication can be:

Formal Communication:

The paths of communication which are based on relationship establish formally by management are the formal channels e.g. the General Manager communicates a decision to the production manager who may then issue orders or instructions to the foremen.

Informal communication:

Communication, which takes place on the basis of informal or social relations among staff, is called informal communication. e.g. any sharing of information between a production supervisor and an accountant, as they happen to be friends or so. It may be purely personal or related to organisational matters.

Upward, Downward, Horizontal and Diagonal Communication

(On the basis of the flow or direction of communication)

On the basis of the flow or direction of communication in organisations, it can be classified as upward, downward, horizontal or diagonal.

Upward Communication:

When employees make any request, appeal, report, suggest or communicate ideas to the superior, the flow of communication is upward i.e. from bottom to top.

Examples: Foreman's report regarding breakdown of machinery to the factory manager, application for grant of leave, submission of progress report, request for grants etc.

Downward communication:

When communication is made from superiors to subordinate, it is called a downward communication.

Examples: When superiors issue orders and instructions to subordinates, sending notice to employees to attend a meeting, ordering subordinates to complete an assigned work, passing on guidelines framed by top management to the subordinates.

Communication of work assignments, notices, requests for performance, etc. through bulletin boards, memos, reports, speeches, meetings, etc. are all forms of downward communication.

Horizontal flow of communication

Communication amongst members at the same level in the organisation is called horizontal flow of communication.

Examples: Production manager may communicate the production plan to the sales manager, a production manager may contact marketing manager to discuss about schedule of product delivery, product design, quality etc.

Diagonal Communication:

When communication is made between people who are neither in the same department nor at the same level of organisational hierarchy, it is called diagonal communication.

Examples: Cost accountant may request for reports from sales representatives for the purpose of distribution cost analysis.

Verbal and Non-verbal Communication

(On the basis of the mode used)

On the basis of the mode used, communication may be verbal or non-verbal.

Verbal Communication:

While communicating, managers may talk to their subordinates either face to face or on telephone or they may send letters, issue notices, or memos. These are all verbal communication.

Verbal modes of communication may be oral and written.

Oral communication:

Face to face communication, as in interviews, meetings and seminars, Issuing orders and instructions on telephone or through an intercommunication system is also oral communication.

Written Communication:

The written modes of communication include letters, circulars, notices and memos.

Gestural communication:

When verbal communication is supported by non-verbal communication such as facial expressions and body gestures, like wave of hand, a smile or a frown etc. it is called gestural communication.

Communication Element of Direction

Communication Networks:

(Not in CBSE syllabus from 2023-24)

Communication network is the pattern through which communication flows within the organisation.

Types of communication networks in Formal Communication

1. Single chain:

This network exists between a supervisor and his subordinates. Since many levels exist in an organisation structure, communication flows from every superior to his subordinate through single chain.

2. Wheel:

In wheel network, all subordinates under one superior communicate through him only as he acts as a hub of the wheel. The subordinates are not allowed to talk among themselves.

3. Circular:

When each person communicates with his adjoining two persons, he is said to be  part of  a circular network. In this case, communication flow is slow.

4. Free flow:

When each person can communicate with others freely, such network is called free network. The flow of communication is fast in this case.

5. Inverted V:

In this network, a subordinate is allowed to communicate with his immediate superior as well as his superiors superior. However, in later case, only prescribed communication takes place.

Informal Communication

Communication that takes place without following the formal lines of communication is said to be informal communication.

Informal system of communication is generally called as ‘grapevine’ because it spreads throughout the organisation with its branches going out in all directions in utter disregard to the levels of authority.

How does Informal Communication arise?

The informal communication arises out of needs of employees to exchange their views, which cannot be done through formal channels.

Examples of informal communications:

1. Workers chit chating in a canteen about the behaviour of the superior.
2. Discussion about rumours that some employees are likely to be transferred.

Can Informal Communication be eliminated?

The grapevine/ informal communication spreads rapidly and sometimes get distorted. It is very difficult to detect the source of such communication. It also leads to generate rumours which are not authentic which may hamper work environment.

Sometimes, grapevine channels may be helpful as they carry information rapidly and, therefore, may be useful to the manager at times. Informal channels are used by the managers to transmit information so as to know the reactions of his/her subordinates.

So, an intelligent manager should make use of positive aspects of informal channels and minimize negative aspects of this channel of communication.

Grapevine Network (Informal networks)

(Not in CBSE syllabus from 2023-24)

Grapevine communication may follow different types of networks.

1. Single strand:

In single strand network, each person communicates to the other in sequence.

2. Gossip network:

In gossip network, each person communicates with all on non-selective basis.

3. Probability network:

In probability network, the individual communicates randomly with other individual.

4. Cluster network:

In cluster network, the individual communicates with only those people whom he trusts. Cluster is the most popular network in organisations.

Barriers to Communication

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Q     Which managerial function is the most activating function?

Q      What do you mean by directing?

Q      What are the elements of directing?

Q      Explain the characteristics of directing.

Q      How is directing a continuous process?

Q      What is the importance of directing?

Q      Explain the principles of directing.

Q      What is supervision?

Q      Write the importance of supervision.

Q      What is the role of supervisor?

Directing Question Bank

Q      Define the terms: motive, motivator and motivation.

Q      Explain the features of motivation.

Q      Give the meaning and example of positive motivation.

Q      Give the meaning and example of negative motivation.

Q      Explain the steps in the process of motivation.

Q      How is motivation important for the management?

Q      How is motivation helpful in fighting the problems of absenteeism and labour turnover?

Q      What is the contribution of A.H.Maslow towards the management?

Q      What are the main assumptions of Maslow’s need Hierarchy theory of needs?

Q      What are the types of needs as given by Maslow?

Q      What are the main points of criticism of theory of needs as given by A.H.Maslow?

Q      What are financial and non-financial incentives?

Q      State the levels at which different type of incentives are important.

Q      What is leadership?

Q      What are the features of leadership?

Q      What are the qualities of a good leader?

Directing Question Bank

Q      What is the importance of leadership?

Q      What do you mean by communication?

Q      What are the steps or elements of communication process?

Q      How is communication a two way process?

Q      How is communication a circular process?

Q      Is communication complete without feedback?

Q      What do you mean by ‘noise’ with reference to communication?

Q      What do you mean by formal communication?

Q      What do you mean by informal communication?

Q      Write the types of formal communication on the basis of expression of message and on the basis of direction of flow of message.

Q      What do you mean by grapevine communication? Why is it called so?

Q      What are the types of networks of formal communication?

Q      What are the types of networks of informal communication?

Q      What do you mean by barriers to effective communication?

Q      What are the different types of communication barriers?

Q      Give the suggestions to overcome the barriers to effective communication? Name the process of exchanging ideas ,facts and information?

Q      Name the element of directing under which sub-ordinates share his views with his superior.

Q      Which type of communication takes place between superior subordinates in the office?

Directing Question Bank

Q      It is concern with instructing, guiding and inspiring people in the organizations achieve its objectives. Name it.

Q      Every manager from top executive to supervisor performs the functions of directing. Which characteristics of directing are referred here.

Q      It take place throughout the life of the organization irrespective of people occupying managerial positions. Mention the characteristic of directing highlighted here .

Q      “Directing is the least important functions of management”. Do you agree with this statement? Give reasons in support of your answer.

Q      “Directing is not at all reinsured in an organization” do you agree? Give reasons in support of your answer.

Q      “A supervisor is not at all reinsured in an organization” do you agree? Give reasons in support of your answer.

Q      “The post of supervisor should be abolished in the hierarchy of managers”. Do you agree? Give reasons in support of your answer.

Q      It means overseeing the subordinates at work. Which element of directing is referred to, in this statement?

Q      Supervisor acts as a link between workers and management. How?

Q      Which element of directing helps in inspiring subordinates to give their best to the organization. Explain any three points of importance of this element.

Q      Under these incentives schemes employees are offered company shares at a set price which is lower than market. Which incentive scheme is mentioned here?

Q      To satisfy the social and psychological needs which type of incentives are needed? Explain four types of such incentives.

Q      It is defined as the process of influencing other people to work willingly for group objectives. Mention this element of directing.

Q      Name the type of formal communication in which the persons of the departments, one at a higher position other at lower, communication with each other.

Q      Name the type of written communication in which two departmental heads communicate with each other.

Q      A and B are working in the same organization but in different departments. One day at lunch time B informed A that due to computerization many people are going to be retrenched soon from the organization. Name, which type of communication is this?

Q      There are some barriers in communications, which are concerned with encoding and decoding of message. State any three such barriers.

Q      There are some barriers in communications which are concerned with organizational structure and regulations. State any three barriers.

Q      There are some barriers in communication which are concerned with the state of mind of both the sender and the receiver. State any three such barriers.

Directing Question Bank

Q      Name and explain the last steps of communication process.

Q      Name the grapevine network in which an individual communicate with only those people whom he trusts?

Q      The employees of HCL have formed a dramatic group for their recreation. Name the type of an organization.

Q      Mr. Nijjar, a sales manager, achieved his sales targets one month in advance. His achievement was displayed on the notice board and a certificate for the best performance was awarded to him by the CEO of the Co. Name the incentive offered to the employees.

Q      In an organization, all 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 inefficiency in the office. It has resulted in loss of secrecy and leakage of confidential information. What system do you think the manager should adopt to improve communication.

Q      Mr. Harshit is a production manager in a leather manufacturing unit. He is very strict and does not have cordial relations with his subordinates. So, the subordinates always feel they are under stress and they are not working in a good environment. The subordinates always take least initiative and fear to express their problems or suggestions before Mr. Harshit. What do you think is wrong with Mr. Harshit?

Q      The marketing manager delegates the task to five sales representatives working under him. Among them the three sales representatives were able to achieve their respective targets. As a result the marketing manager talks to the CEO of the company to recognize the performance of the three sales representatives. The company decides to upgrade their cadre and their salary package also. Name and explain the element of directing function which the company assures the three representatives to achieve their targets.

Directing Question Bank

Write the values followed or ignored in the following cases:(Not in CBSE pattern now)

Q      A Supervisor hears the suggestions and also implements the good suggestions while taking decision for the employees?

Q      In an organization the good environment, refreshment Corner and entertainment rooms have been made for all employees.

Q      In an organization the employees are being paid fair remuneration and productivity based bonus.

Q      A liquor manufacturing firm provides liquors to its employees at cheaper rates to motivate them.

Q      In an organization, informal communication is stressed instead of formal communication which results in non reaching of proper communication to proper person in proper time. It results in either non completion or delay in work.

Q      A leader solves the problems relating to work and the personal problems also of the followers.

Q      Mr. A is a management professional for the last 10 years. In a recent assignment for an infrastructure company, he advised his client that he must take care of handicap people while constructing commercial or residential properties so that they do not feel troubled while moving around in those buildings.

Q      There is a get together in an organisation where only selected few employees are invited who are close to top management of the company.

Q      Mr. Kalsi works in a company where he is usually required to sit late hours due to excessive workload. One day his son was ill, and he wanted to have an off to take care of his ailing son, but his boss refused to give him leave.

Q      A Company appoints Mr. Rajat as supervisor of their production department. He is kind and guides his subordinates. He clarifies their doubts in performing the task. This helps the worker to achieve their targets. As a supervisor, what functions will you perform to cope with the situation. What positive values exhibited by Mr. Rajat?

Directing Question Bank

MCQs from CBSE Sample Papers

Case Based Question

Read the following text and answer the following questions on the basis of the same:

Mr. Sunil Diali is a safety officer in a reputed PSU sector ECL. He supervises the workers towards the predetermined goals of the organisation and directs how to eradicate unsafe practices of inundation, fire breakouts, existence of inflammable gases etc.

On one such instances there was huge fire breakout in the underground mines and the workers morale was down and demotivated because of several risk hazards. Mr. Diali observed the whole situation and consulted with all his workers and constantly monitored, guided and inspired them to integrate their efforts and accept the situation as a challenge and take adequate safety measures for fire extinguishing and subsidizing its effects. Thereby, production turnover was outstanding and outperformed other subsidiaries. Mr. Diali was recognised with Bravery Award from CIL.

Q.1 Mr. Diali worked towards predetermined goals of the organization. Which important function of directing is addressed here?

1. Means of motivation
2. *Initiates action
3. Facilitates change
4. Brings stability

Q.2 Mr. Diali consulted with all his workers; he listened to their opinions. Which form of leadership is identified here?

1. Laissez-faire
2. *Autocratic
3. Democratic
4. Free rein

Q.3 Bravery award is form of non-financial incentive.

1. Status
2. Job security
3. Career Advancement
4. *Employee recognition

Q.4 Under Maslow’s hierarchy need theory which need of Mr. Diali has been met

through respect and recognition among other employees?

1. Self – Actualization need
2. Safety and security needs
3. *Esteem needs
4. Physiological needs.

Directing Question Bank

MCQs from CBSE Question Papers

Question:

________ is concerned with designing jobs that include greater variety of work content, require higher level of knowledge and skill, and give workers more autonomy and providing them opportunity for personal growth and a meaningful work experience.

1. Job security
2. Perquisites
3. Employee recognition programme
4. *Job enrichment

Question:

To motivate its employees on one side, 'Harshita Pearls' rewards them with increase in pay, promotion, recognition, etc. whereas on the other side it stops increments, gives punishment, threatens employees so that they may act in a desired manner. Which feature of motivation is being highlighted in the above case?

1. Motivation is a complex process.
2. Motivation is an internal feeling.
3. *Motivation can be either positive or negative.
4. Motivation produces goal-directed behaviour.

Question:

'Maslow's Need Hierarchy theory' is based on certain assumptions. Identify the incorrect statement with respect to these assumptions:

1. People's behaviour is based on their needs.
2. A satisfied need can no longer motivate a person.
3. People's needs are in a hierarchical order, starting from basic needs to higher level needs.
4. *A person moves to lower level of need only when a higher-level need is satisfied.

Question:

Statement 1: Leadership indicates the ability of an individual which influences the behaviour of others.

Statement II: Leadership is exercised to achieve personal goals of the leader.

Choose the correct option from the following:

1. *Statement I is true and Statement II is false.
2. Statement II is true and Statement I is false.
3. Both the Statements are true.
4. Both the Statements are false.

Directing – Keywords and Brief Notes

MCQs to Revise Business Studies Class 12

MCQs Based Commerce Quizzes

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