NCERT Solutions for Class 12 Business Studies Chapter 5: Organising
This chapter delves into the core principles and functions of organising within a business context. It covers essential concepts such as delegation of authority, the elements that constitute delegation, and the nature of informal organisations. The solutions provide clear explanations for multiple-choice questions, helping students grasp the distinctions between formal and informal structures, the flow of communication, and the implications of organisational design. Understanding these concepts is crucial for effective management and efficient operations. These NCERT Solutions are designed to aid students in their exam preparation by offering detailed explanations and reinforcing key takeaways from the chapter.
Quick info
| Board | CBSE |
|---|---|
| Class | Class 12 |
| Subject | Business Studies |
| Session | 2026 |
| Language | English |
| Type | NCERT Solutions |
| Chapter | Chapter 5 |
Chapter summary
Chapter 5 of the Class 12 Business Studies syllabus focuses on the 'Organising' function of management. The NCERT Solutions provided cover key concepts like delegation of authority, its elements (authority, responsibility, accountability), and the emergence and characteristics of informal organisations. The solutions clarify how these concepts differ from formal structures and relate to organisational efficiency, aiding students in understanding the practical application of organisational principles.
Learning outcomes
- Understand the concept and elements of delegation of authority.
- Differentiate between formal and informal organisations.
- Explain the characteristics and importance of informal organisation.
- Identify which organisational structures follow the scalar chain.
- Solve multiple-choice questions related to organising principles.
Topics covered
Paper topics
- Organising Function of Management
- Delegation of Authority
- Elements of Delegation (Authority, Responsibility, Accountability)
- Informal Organisation
- Formal Organisation
- Scalar Chain
- Functional Structure
Important topics
- Delegation of Authority
- Elements of Delegation
- Informal Organisation
- Formal Organisation vs. Informal Organisation
- Scalar Chain Principle
PDF preview
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Questions and Solutions
Question 1
- Accountability
- Authority
- Responsibility
- Informal Organisation
The correct answer is Informal Organisation. Delegation is a management process that involves assigning authority and responsibility to a subordinate to carry out specific activities. The core elements of delegation are Authority (the right to give orders and make decisions), Responsibility (the obligation to perform the assigned task), and Accountability (being answerable for the final outcome). An informal organisation, on the other hand, is a network of social relationships that arises spontaneously from interactions among employees and is not a part of the formal delegation process.
Question 2
- Formal Organisation
- Informal Organisation
- Decentralisation
- Delegation
The term for a network of social relationships that arise spontaneously due to interaction at work is Informal Organisation. This type of organisation emerges naturally from social interactions and the free flow of communication among employees, irrespective of the formal structure. In contrast, a formal organisation is deliberately designed by management, based on defined roles, responsibilities, and a superior-subordinate hierarchy. Decentralisation and delegation are processes related to the distribution of authority and responsibility, not the social networks themselves.
Question 3
- Functional structure
- Formal organisation
- Informal organization
The Informal organization is the one that does not strictly follow the scalar chain. The scalar chain is a principle of formal organisation that defines a line of authority from the highest to the lowest rank, ensuring clear communication channels. While formal organisations (including those with a functional structure) generally adhere to this chain, informal organisations develop spontaneously through social interactions and allow communication to flow more freely, often bypassing formal hierarchical levels.
Common mistakes
- Confusing elements of delegation with unrelated organisational concepts.
- Failing to distinguish between formal and informal organisational structures.
- Misinterpreting the flow of communication in different organisational types.
Revision tips
- Focus on the definitions and key differences between formal and informal organisations.
- Review the three essential elements of delegation: authority, responsibility, and accountability.
- Practice identifying which organisational structures adhere to the scalar chain principle.
- Use the provided solutions to check your understanding of the multiple-choice questions.
Practice MCQs
Q1. Which of the following is NOT considered a fundamental element of delegation of authority in an organisation?
Explanation: Delegation involves the transfer of authority and responsibility, creating accountability. An informal organisation arises spontaneously from social interactions and is not a direct element of the delegation process.
Q2. What is the term for a network of social relationships that spontaneously emerge from interactions among employees at the workplace?
Explanation: An informal organisation is characterized by social relationships and spontaneous communication networks that develop among employees, independent of the formal structure.
Q3. Which type of organisational structure is known for NOT strictly following the scalar chain of communication?
Explanation: While formal organisations generally adhere to a scalar chain, informal organisations allow for free-flowing communication that bypasses formal hierarchical lines, thus not strictly following the scalar chain.
Frequently asked questions
What are the key elements of delegation of authority?
The key elements of delegation of authority are Authority (the right to command), Responsibility (the obligation to perform a task), and Accountability (being answerable for the outcome).
How does an informal organisation differ from a formal organisation?
A formal organisation is deliberately planned and established by management to achieve organisational objectives, following a defined hierarchy. An informal organisation arises spontaneously from social interactions among employees and is not officially created by management.
Does an informal organisation follow the scalar chain?
An informal organisation does not strictly follow the scalar chain. Communication can flow freely among members, often bypassing formal hierarchical levels.
What is the main purpose of delegation in management?
Delegation helps managers to distribute their workload, empower subordinates, develop their skills, and improve efficiency by allowing them to focus on more critical tasks.
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