TyroCity: Business Studies Notes

Components of direction

Business Studies XII — Sun, 18 Aug 2013 05:41:42 +0000

Aspects of direction
Direction is an integration of motivation, leadership, communication and coordination. It is an important function of management which is related to issue orders to staff.

1. Motivation: it is the process of inspiring and encouraging the people to do work. It is a skill of using the capability of manpower for the organization. It is a mental and physical presence of employee to do work. Effective motivation helps to raise the effective direction. Therefore, motivation is important aspect of direction.

2. Leadership: it is another important aspect of direction. It is defined as the process of influencing people to perform work effectively. In other words, it influences the behavior of employees or subordinate. According to time, situation and behavior of followers, a leader must conduct his followers. Therefore, it is an important aspect of direction.

3. Communication: communication means transferring information from one person to another. In other words when the information is transmitted from one person to another and information receiver easily take the information, it is known as communication. It includes sending message and receiving message. After sending message receiver receives the message and understands it. Therefore, message receiver responds and reacts about the message. In an organization manager must develop an effective communication system so that s/he may give instruction and guidance to the subordinates and motivate them to do the work to the best of their ability.

4. Coordination: it is also an important aspect of direction. When the coordination activity is not conducted effectively. Direction is not effective. Coordination is the process of linking activity of resources and various departments so that desired goal can be achieved easily. It is inter-related with all managerial function.

5. Supervision: it is another important aspect of direction. Direction is not only to issue order but also supervising job of subordinates. It is an important function of every manager. So the manager’s duty is to look after their work and examine that whether they have done according to the order issued or not and also help in solving their work problems.

Types of partnership

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

1. General partnership
Partners have equal rights and all of them participate in management. It is jointly involved to operate the business. There are the types of general partnership.

Partnership at will
It continues up to time of partner. It is dissolved when all partners want dissolution. They can leave the firm at will. There is no fixation of duration of firm.
Particular partnership
It is established for definite workers at definite period. When task is finished partnership is dissolved in particular partnership.

2. Limited partnership
A limited partnership is that type of partnership in which there is one or more partners having limited liability. The liability of limited partners is limited to their capital invested. They can’t participate in the managerial activities, but they can advise. They also don’t have right to make decision and close the firm.

Sources of office information : internal and external

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Internal communication
All the communication that takes place in carrying out works and tasks within a business is known as internal communication. It is helpful for office works. This is the communication that takes place among the business managers, employees and workers to create, implement and to make plans. It helps to maintain coordination. It is classified into inter departmental and interdepartmental It includes letters, memos, reports, announcement, circular etc.

External communication
When people of one organization transmit information to the people of other organization, then that communication is called external communication. It maintains good relationship with outsiders such as supplier, customers etc. It is very important for the business. It is classified into two types: Inward communication and outward communication.

Structure of business letters

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Business letter is one which appears well, is written well and communicated well. It includes several parts and the parts are arranged in sequence to make it meaningful. Arranging various parts in proper sequence in letter is called structure of business letter. The structure is heading, opening, body and closing:

1. Heading
Heading is used to convey a positive image of the company. Because it includes the company’s address, phone and often email. It is not necessary to include that information again in the body of the letter. Sometimes the writer will provide a direct phone number or personal email address if the action statement calls for direct communication.

Inside Address
Two spaces below the date are the full name and business address of the person to whom the letter is addressed. If several people are receiving the letter, all their names and addresses should appear. The address on the letter should be the same as the address on the envelope. As with the date, there can be legal consequences for inaccuracies. The address on the letter is presumed to be the one to which the letter is actually sent. If it is incomplete or inaccurate, a recipient can make the case that the letter was mailed to the incorrect address as well.

Date
Full date must be included in the letter. The date can be any agreement being made Because the letter is a formal document, often used in contract situations, the date can be extremely important. The letter is usually dated the same day on which it is mailed, but whatever agreements are included in the letter are considered effective as of the date of the letter.

The opening

Salutation
The formal greeting always starts with “Dear” followed by the person’s title and last name, and ending with a colon. This requires finding out whether the recipient is properly addressed as Mr., Ms. Or Dr. Attempts to avoid the issue (i.e. Substituting the title with the person’s first name, using impersonal phrases like “Mr. Or Ms” or “To Whom It May Concern”, or eliminating the salutation entirely) indicate that the writer doesn’t actually know the recipient of the letter at all, making the letter a “form” letter, a much less formal document.

Body

Context Paragraph
The first paragraph of the letter will define the context, providing a clear statement of the letter’s topic and purpose. Avoid starting a letter flowery language that doesn’t explain what the letter is about. In social letters or in letters written for businesspeople, it is appropriate to begin a letter with a question about the family or a comment about recent weather or world events. U.S. businesspeople, however, generally prefer to find out right away why the letter has been written.)

Content Paragraphs
The typical letter uses one to three paragraphs to provide the information relevant to its purpose. Each paragraph should cover a single topic or point. In the case of a long letter that covers multiple pages, it is appropriate to break the information into sections with internal headers or bullets to provide clarity.

Action Paragraph
The final paragraph of the letter provide a clear, straightforward statement of the action that will be taken be the writer, requested of the reader, or expected by a third party.

Closing
Two spaces below the final paragraph of the letter, a traditional closing line, generally “sincerely” or “respectfully,” ends the letter. If the situation calls for a warmer tone, the closing might be “cordially,” “best wishes,” or “regards.”

Signature
A four-line space allows room for a written signature immediately below the closing, then the sender’s full name is typed, with the full business title (sometimes with the department or division as well) on the next line. The signature on a business letter signifies that the writer is taking responsibility for fulfilling any commitments being made. Thus, even when the sender and recipient know each other well, a full signature is used.

When writing on behalf of a team or department, type the group’s proper name immediately above the written signature of the team’s representative.

Registration of Cooperative Organization in Nepal

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

A cooperative organization can carry out its functions only after its registration under the cooperative act 2048. For registration of cooperatives following procedures should be followed.

1. Preliminary meeting:
According to the cooperative act 2048 there should be at least 25 members to form a cooperative society. Preliminary meeting must be held before applying for the registration. The meeting is held in the presence of 25 members under 1 chairman among them. The following things should be discussed in the meeting:

Commencement of the business
The name and address of the society
The objectives of the society
The value of each share
Membership fee

2. Filing an application for registration
After preparing and passing proposed by laws and working schemes in the preliminary general meeting. In application should be submitted to the office of registrar, department of cooperatives, and government of Nepal

Following things are mentioned in the application form

Proposed name of society
Address
Objectives
Working areas
Liabilities
Total share capital
Total number of shares to be paid
Two copies of law of proposed society
Original copy of working scheme
Copies of citizen certificate
Application must be signed by chairman

3. Receiving the certificate of registration
After filing application for registration, certificate of registration is to be received. After applying application along with document, they are submitted at the registration office. Then the registrar checks all the documents. If the documents are satisfactory then registrar will issue certificate of registration. After receiving certificate of registration, the society can operate.

Legal provisions for dissolution of co-operative society

According to the cooperative act 2048 cooperative society can be dissolved under following circumstances

Two third majority of total number of society can take decisions of dissolution.
Registrar can dissolve it, if application with reasonable clause is received.
Registrar can dissolve it, if the society is found inactive and not operating for two years.
The registrar can dissolve it, if it is found operating against the law and objectives of it.

Selection of Office Location

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Nearness to customer: The office should be accessible to customers. They do not like long distances to make business inquiries. The office should be accessible to other parties who are in regular contact.
Nearness to related business: It is desirable to locate the office near the offices of related business. It should be established in the same line of trade.
Availability of infrastructure: The infrastructure should be available in office location. It consists of transport, communication, power, water and parking facilities.
Nature of business: The nature of business affects location of office. Office of manufacturing business in located near the source of raw materials, labor and service facilities. Office of trading and banking business is located in commercial centers near the customers. Office of perishable goods business is located near the market for such goods.
Availability of human resources: Needed human resources should be available for office. They can be skilled, semi-skilled and unskilled. All facilities must be available for employees
Environment: The office location should have healthy environment. It should not be near polluted rivers or waste disposal sites. It should be free from noise, dust and pollution.
Cost of space: Sufficient space should be available at reasonable cost for the office. Space should be available for future expansion.
Government laws: The selection of location should comply with government laws and regulation at national and local levels.

Business Studies XI Questions

TyroCity.com — Sun, 18 Aug 2013 05:41:42 +0000

Question Collection

Model Question of Business Studies – Class 11

Partnership deed : meaning and contents

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Partnership deed
The written agreement duly signed by the partners is known as partnership deed. It is also known as agreement or article of partnership. It is the document, which mentions the rules and regulations, way of operation of management and way of control of activities of the firm. It is also required at the time of registration. It helps to minimize conflict and misunderstanding among the partners.

Content of partnership deed

Name and address of the firm
Name and address o the partners
Nature of rim’s business
Duration of partnership
Amount of capital invested by the partners.
Interest on capital
Division of profit
Salary and commission
Right and duties of partner
Admission and removal of partnership
Valuation of capital and goodwill at the time of admission, death and retirement of partners
Accounts and audits
Dissolution of partnership.

Importance of business communication

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Importance of business communication are listed below:

1. Managerial efficiency: Communication helps in the smooth operation of management. A managerial task can only be performed when the communication system is effective.

2. Enhance morale and relations: Effective communication emphasizes the employee’s participation in management. It helps to build the employees morale and cordial industrial relations between management and employees

3. Effective leadership: Effective leadership depends on effective communication. Two-way communication helps in effective communication. A managerial leader must handle the subordinates. For ordering qualitative leadership is essential. And that can be obtained from a proper system of communication.

4. Mutual trust and confidence: Mutual trust and confidence between labor and management are necessary for the effective movement of the organization. When there is effective communication, it helps to reduce misunderstanding and develop mutual trust.

5. Better decision: The success of an organization can be measured in better decisions. When the information, data and other fact are not effectively communicated, it hampers the decision-making. So, when the facts are communicated to concerned department, organization and person. It is easy to make decisions promptly.

6. Staffing: When the information are correctly communicated in time, it helps in the function of selection, placement, socialization, promotion, and transfer.

7. Better managerial concern: All managerial functions such as planning, organizing, directing, controlling, etc can’t be conducted without communication.

Leadership Styles | Business Studies

Business Studies XII — Sun, 18 Aug 2013 05:41:42 +0000

1. Autocratic leadership style: When the authority and decision-making power are concentrated on the leader is known as autocratic leadership style. There is no participation by subordinates. The leader takes full authority and assumes full responsibility. Planning, policies and other working procedures are predetermined by the leader alone. They convey the information about what to do and how to do. He never takes any advice and suggestions of other people. They structure the entire work situation in their own way and expect the workers to follow their orders and tolerate no deviation from their order. They are just like tyrant rulers. The leader who believes and exercised the autocratic leadership style is known as autocratic leader.

Features:

He/she makes his own decisions and he/she doesn’t take any advice of others because he/she thinks he/she is only superior.
His/her position gives him/her personal authority and right to lead the members in any way he/she desires.
Reward and punishment is exercised by him/her very strictly. Autocratic leadership style believes on negative motivational tools.
An autocrat leader does not give full information to the members. There is only one way communication in order to maintain the position.
An autocratic leader describes each job in detail and imposes rigid work standard on his employees. It means the subordinates are compelled to certain work assigned for him.

Advantages:

It is useful in emergency or in war.
When the workers are undisciplined and uneducated it gives the best results.
When the laborers are not organized, it is more effective.
There is no need of trained labor. It may be used for untrained workers.
It is a prompt process of decision-making as the single person decides for the whole group.

Disadvantages:

Subordinates are not involved in the process of decision-making in autocratic leadership style
It doesn’t emphasize on correct evaluation of employee’s performance
The moral of employees is so low.
There is no chance of management development.
There is no chance of two-way communication.
Creative ideas and thinking cannot be used in autocratic leadership style.
The employees perform the work with negative motivation.

2. Democratic leadership style: When the authority and decision-making power are decentralized to the subordinates is known as democratic leadership style. There is participation by subordinates. The leader delegates authority and provides responsibility even to the followers. Planning, policies and other working procedures are determined by the leader along with suggestions of the followers. He conveys the information about what to do and how to do just as a consultant. He takes advice and suggestions of other people. They structure the entire work situation in democratic way. They are just like democratic rulers. The leader who believes and exercised the democratic leadership style is known as democratic leader.

Features:

A democratic leader delegates the responsibility as per the capability of the employee
There is participation of all subordinates in decision-making
Human values are also given preference. The leader gives concerns for the followers
Democratic leader imposes flexible work standard, designs goals with freedom for the performance of work.
A democratic leader emphasizes in results than on action

Advantages:

Good cooperation among employees is made in democratic leadership style
Employees are highly satisfied and their morale is increased
Human efforts are highly recognized
It helps in increasing in productivity
Policies, planning and other working procedures become better because different kinds of logic ideas and creativity are mixed
Subordinates have grown considerable freedom of action that helps to increase the personal growth and gets opportunity to utilize their capabilities

Disadvantages:

It takes long time in decision-making
It is not suitable for untrained subordinates
A leader may to be responsible in his style
It is not suitable when the followers are undisciplined and untrained

3. Free rein leadership style: When all the authority and responsibility are delegated to the subordinates is known as Free rein leadership style. The leader who believes on this style is known as free rein leader. The free rein leader doesn’t use the power and leaves the power to the subordinates. He/she doesn’t provide any contribution to make planning and policies. This type of leadership style is very useful when group members are intelligent and fully aware of their roles and responsibilities.

Features

Subordinates have complete freedom in decision-making
The subordinates are self-directed, self-motivated and self-controlled
The role of free rein leader is to provide facilities, materials and information to the employees
The leader doesn’t interfere in making planning and policies

Advantages:

The employees are satisfied in their job because they are free in decision-making
The morale of employees is developed
The employees are highly developed because there is maximum possibility for the development of workers
The creativity and potentiality of subordinate are fully utilized

Disadvantages:

Leader contribution is ignored.
Sometime the subordinates are not self-directed.
Subordinates should not get the guidelines of the leader.

Role of cooperative organization in developing countries

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Following are the role of cooperatives in developing countries:

Works for the economic progress of the nation
Uplifts the poor people.
Develop the weaker section of the country
Bring balance between economic and social development of the country
Mobilization of resources in rural areas
Employment of the people in agricultural sector
Provide better qualities of seeds, fertilizers, pesticides, insecticides to the farmers
Help to get agricultural loan.
Helps to establish business in low capital
Enhance the economic activities like banking, shares, investment and so on
Encouragement in saving
Farmers, employee, and small retailers who are often neglected for loan are provided credit facilities.
Provides loan to poor farmers at low interest rate.
Elimination of poverty
Increase the living standard of people

Concept of cooperative organization

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Meaning and concept
Co-operative organization is the form of organization where in persons voluntarily associate together as business being a basis of equality for promotion of economic interest of themselves. It is a voluntary association of persons with same interest. It is guided by service motive. It is established for economical and social development of weaker section of the society. It tries to solve similar problems. In all form of business organizations, the objective of owner is to make profit. But its objective is to provide services. Its motto is all for one and one for all. It helps through mental support too. It can be defined as voluntary association of person usually of limited means forming together in equal basis for promotion of certain economic or business interest.