Business Organisation-Organization and Management-JAIBB

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under  The Institute of Bankers, Bangladesh (IBB)

 Organization & Management-JAIBB

  Business Organisation

Q.1 What do you mean by Business Organisation? Also explain its characteristics and nature of Business Organisation?

Ans.: A Business organisation refers to any industrial, commercial or service rganisation which produces goods and or services for sale, or engages in distributing or assists in the process thereof. It is to represent any collection of business resources – factories, warehousing, machinery, material, employee etc.,and the
planned use of which is limited within the framework of a one man business, partnership, company, are other form of business organisation.

 In the words of Richard Norman Owens, “A business organisation is an enterprise engaged in the production or distribution of goods for sale in a market or rendering services for a price.”

In the words of Bayard O Wheeler, “A business firm is an institution, company or enterprise which is engaged in buying or selling, being owned by one person or group of persons, who manage it within certain laid down creative policies.”

Characteristics and Nature of Business Organisation :


(i) An association of persons or group.

(ii) A pluralistic institution.

(iii) Different forms.

(iv) Wide scope of activities.

(v) Coordination of resources.

(vi) Created utilities.

(vii) Intensity of capital.

(viii) Increasing trend in forming into combination.

(ix) Customer satisfaction.

(x) Dynamic Environment.

(xi) It is a system an organ of the society.

(xii) Customer orientation.

(xiii) Socio-economic institution.

(xiv) Operating in different sectors of the economy.

(xv) An institution with multiple objectives.

(xvi) Faster growth of service organisation.

(xvii) Global operation.

(xviii) Independent and separate role of entrepreneur and manager.

(xix) Innovations and marketing as basic functions.

(xx) Government control and regulation.

(xxi) Improves the standard of living of people.

Q.2 Explain the significance of Business Organisation.

Ans.: The Significance of business may classified into the following four categories;

namely :

(1) Significance to National Economy

(2) Significance to Business itself

(3) Significance to Community

(4) Significance from other point for view

(1) Significance to National Economy : The significance of business to a nation may be expressed by the following facts :

(i) Optimum and profitable use of resources.

(ii) Balanced industrial growth.

(iii) Source of national income.

(iv) Faster economic growth in the country.

(v) Contributes of national prosperity.

(vi) Better utilisation of human resources.

(vii) Increase in the standard of living of the people.

(viii) Source for meeting import requirements.

(ix) To meet the obligations of development planning.

(x) Larger creation of employment.

(xi) Eradication of poverty.

(xii) Capital formation.

(xiii) Development of labour and capital markets.

(2) Significance to Business itself : The significance of business from the point of view of business itself, may be stated as below :

(i) Large scale production and efficient distribution.

(ii) Creation of healthy competition.

(iii) Fulfillment of social responsibility.

(iv) Decrease in the cost of production.

(v) Helps to develop managerial skill.

(vi) Greater utilisation of production capacities.

(vii) Development of the undertaking.

(viii) Profitable sales volume.

(ix) Specialisation in production.

(3) Significance to Community : The Significance of business from the point of view of community is discussed below :

(i) Uplifts the standard and quality of life.

(ii) Development of labour markets.

(iii) Human prosperity.

(iv) Creation of employment.

(v) Creates habits of saving.

(vi) Provides goods and services at reasonable prices.

(vii) Advantage of form, place, time and possession utilities.

(viii) Consumer education.

(ix) Attention towards customer grievances.

(x) Appointment of efficient and experienced salesmen.

(4) Significance to other point of view : The other significance of business may be discussed under the following heads :

(i) Promotion of international trade.

(ii) Closer cultural relations between countries.

(iii) Helps in maintaining political peace.

Q.3 What is Business Environment and what are it’s components?

Ans.: The environment of business is an extremely complex and dynamic phenomenon. It is the product of the technological, political legal, economic, social cultural, global and natural factors among which it functions. The environmental factors vary from country to country, even region to region. Environment is a mixture of economic, social, political, legal and technological forces.

 Arthur M. Weimer writes the business environment is the climate or set of conditions; economic, social, political or institutional in which business activities are conducted.

In the wards of William Gluck and Jauch, “Environment contains the external factors that create opportunities and threat to the business. This includes socioeconomic conditions, technology and political conditions.”

Component of Business Environment : The component of Business Environment are as follows :

Q.5 What do you mean by Business Ethics? Explain its main characteristics and scope of Business Ethics?

Ans.: Business ethics is concerned with day to day behaviour of business in a business situation. Business ethics is rapidly becoming an important subject of study replacing yesterday’s “social responsibility of business.”

In the words of Robert Gueinner and others, “Business ethics may be defined as those principles, practices and philosophies that are concerned with moral judgments and good conduct, as they are applicable to business situations.”

In the words of Rogene A. Buchholz, “Business ethics refers to right or wrong behaviour in business decisions.”  

Thus, business ethics relates to the behaviour of a businessman in a business situation.

Characteristics or Assumption of Business Ethics :

For the understanding business ethics, it is necessary to know its important characteristics there are :

(i) As a discipline.

(ii) It is art and science both.

(iii) Ethics is different from social morality.

(iv) Not based on emotions & sentiments.

(v) Business ethics is not affected by social approval or disapproval.

(vi) An ancient concept.

(vii) A universal philosophy.

(viii) Dynamic philosophy

(ix) Theology is the basis of business ethics.

(x) Study of goals and means.

(xi) Recognition of moral responsibility.

(xii) More greater than law.

(xiii) Different from social responsibility.

(xiv) Hermony between different roles.

(xv) Good intention.

Scope of Business Ethics :

 The scope of business ethics or the issues in business ethics are as follows :

(i) Issues relating to objectives of Business.

(ii) Issues relating to employees.

(iii) Issues relating to competitive institutions.

(iv) Issues relating to Government.

(v) Issues relating to national interest.

(vi) Issues relating to owners of business.

(vii) Issues relating to customers.

(viii) Issues relating to creditors.

(ix) Issues relating to local community.

Q.6 Is “Good Ethics promotes Good Business” explain?

Ans.: Well known authorities like Raymond Baumhart, Brener and moltander etc proves in their finding that only those business can exists on a long term basis which conduct their activities on ethical grounds. Their findings were supported by learned, doolby and Katz. At the same time, there are certain other who do

not accept this findings that “good ethics promotes good business.” Although they are few in numbers, their agreements cannot be overlooked.

The following paragraphs give the arguments in favour and against, “good ethics promotes good business.”

Arguments in Favour : 

 Some of the important arguments in favour is as follows :

(i) Satisfaction of sub conscious mind.

(ii) Goodwill of Business and Businessman

(iii) It increases Mutual Trust and confidence.

(iv) Sound Business Insurance.

(v) Helps in Professionalisation of management.

(vi) Initiative for others.

(vii) Relieves from Tensions and worries.

(viii) Greater zeal and productivity.

(ix) Perpetual succession.

(x) Essential in the present situation.

Arguments against the view of “Good Ethics promote Good Business” :

 The critics gives the following argument in support of their claim :

(i) No reward for ethical conduct.

(ii) No resistance from officers.

(iii) Demand of the day.

(iv) Difficult to decide in a situation of dilema.