Knowledge On Aircraft Manufacturing Companies...Aerospace technology & capital intensive industry. The aircraft industry is the industry supporting aviation by building aircraft and

1

----------------------------------------------------------------------------------------------- Go for AAI module of YourPedia for assured success.

For more details visit us at www.yourpedia.in or call at 9855273076

Knowledge On Aircraft Manufacturing Companies

AIRBUS

BOEING

UAC

DASSAULT AIRCRAFT MANUFACTURING COMPANIES Although the airline industry overall is an extremely competitive market, there is little competition among its suppliers of aircraft. In the large commercial aircraft market of the airline supply business, the major players are American-based Boeing (BA) and the Airbus Group, formerly known as the European Aeronautic Defense and Space Company (EADS). Aircraft manufacturing company is a company involved in the various aspects of designing, building, testing, selling, and maintaining aircraft, aircraft parts, missiles, rockets, or spacecraft. Aerospace technology & capital intensive industry. The aircraft industry is the industry supporting aviation by building aircraft and manufacturing aircraft parts for their maintenance. This includes aircraft and parts used for civil aviation and military aviation. It is collectively called Aerospace Industry. The Key Players In Commercial Aircraft Manufacturing Airbus and Boeing, the world's only major large passenger aircraft manufacturers, dominate the airline supply industry with their established brands, Boeing's 7-series and Airbus's A-series of jets. The two companies share almost exclusive control of the worldwide airplane supply business for large commercial jets, which include narrow-body aircraft, wide-body aircraft, and jumbo jets. But a few other companies are present, to a lesser degree, in other segments of the aerospace industry: United Technologies Corporation and General Electric, for example, manufacture engines and parts for industry operators. Bombardier, based in Canada, and Embraer, a Brazilian aircraft manufacturer, are leaders in the regional and business airplanes market, focusing on smaller-sized jets. On a global scale, competition with Boeing and Airbus is difficult. On the regional level, though, other companies are able to take advantage of a niche in commercial aviation, or at least attempt to do so. In addition to the more established Bombardier and Embraer, newer airline suppliers include Comac in China, Mitsubishi in Japan and UAC in Russia. Comac and UAC are working on a series of new wide-body jets in a joint venture that they hope will eventually make them a legitimate competitor to the dominance of Airbus and Boeing in the large-jet space. Boeing and Airbus also have a significant market share in supplying military aircraft – particularly to the United States – facing off against competitors such as Lockheed Martin and United Technologies. However, more than half of Boeing and three-quarters of Airbus revenues come from its commercial business segments. Airbus, Boeing and Tupoloev mainly manufacturer the wide-body and narrow-body jet airliners, while Bombardier and Embraer concentrate on regional airlines.

2



There are five major manufacturers of civil transport aircraft these include: Airbus Boeing Bombardier Embraer Tupoloev

The Top Ten Countries In Aerospace Industry

1. United States (49%) 2. France (8.2%) 3. China (7.3%) 4. United Kingdom (5.8%) 5. Germany (5.5%)

6. Russia (3.2%) 7. Canada (2.9%) 8. Japan (2.5%) 9. Spain (1.7%) 10. India with (1.3%)

These top 10 countries represent $731 Bn or 87.2% of the whole industry In 2019, Airbus displaced Boeing as the largest aerospace company by revenue due to the Boeing 737 MAX groundings, with $2 billion operating losses down from $12 billion profits the previous year. Within the US, the most attractive destination for aerospace Industry is Washington state. Washington is tied to Boeing Commercial Airplanes, earning $10.3 billion, is home to 1,400 aerospace-related businesses, and has the highest aerospace jobs concentration. In the European Union, aerospace companies such as Airbus, Safran, BAE Systems, Thales, Dassault, Saab AB, Terma A/S, Patria Plc and Leonardo are participants in the global aerospace industry and research effort.

3



In Russia, large aerospace companies like Oboronprom and the United Aircraft Corporation (encompassing Mikoyan, Sukhoi, Ilyushin, Tupolev, Yakovlev, and Irkut, which includes Beriev) are among the major global players in this industry. In the US, the Department of Defense and NASA are the two biggest consumers of aerospace technology and products. Who are the major airplane manufacturing companies? Although the airline industry overall is an extremely competitive market, there is little competition among its suppliers of aircraft. In the large commercial aircraft market of the airline supply business, the major players are American-based Boeing (BA) and the Airbus Group, formerly known as the European Aeronautic Defense and Space Company (EADS). Airbus and Boeing, the world's only major large passenger aircraft manufacturers, dominate the airline supply industry with their established brands, Boeing's 7-series and Airbus's A-series of jets. The two companies share almost exclusive control of the worldwide airplane supply business for large commercial jets, which include narrow-body aircraft, wide-body aircraft, and jumbo jets. But a few other companies are present, to a lesser degree, in other segments of the aerospace industry: United Technologies Corporation and General Electric, for example, manufacture engines and parts for industry operators. Bombardier, based in Canada, and Embraer, a Brazilian aircraft manufacturer, are leaders in the regional and business airplanes market, focusing on smaller-sized jets. In addition to the more established Bombardier and Embraer, newer airline suppliers include Comac in China, Mitsubishi in Japan and UAC in Russia. Comac and UAC are working on a series of new wide-body jets in a joint venture that they hope will eventually make them a legitimate competitor to the dominance of Airbus and Boeing in the large-jet space. Boeing and Airbus also have a significant market share in supplying military aircraft – particularly to the United States – facing off against competitors such as Lockheed Martin and United Technologies. However, more than half of Boeing and three-quarters of Airbus revenues come from its commercial business segments. AIRBUS Airbus headquarters are located in the southwest region of Occitanie, near the Toulouse-Blagnac Airport France. Air France Airbus A320-200. BOEING The Boeing Company is an American multinational corporation that designs, manufactures, and sells airplanes, rotorcraft, rockets, satellites, telecommunications equipment, and missiles worldwide. Boeing is among the largest global aerospace manufacturers; it is the second-largest defense contractor in the world based on 2018 revenue and is the largest exporter in the United States by dollar value. The Boeing Company has its corporate headquarters in Chicago, Illinois. BOMBARDIER Bombardier is a global transportation company that is present in over 60 countries on 5 continents. They operate two businesses: Aerospace and Rail Transportation. Bombardier Aerospace is the world's third largest civil aircraft manufacturer and are leaders in the design and manufacture of innovative aviation products and services for the business, regional and amphibious aircraft markets. Their headquarters are in Montréal, Canada. TUPOLEV Tupolev is a Russian aerospace and defence company, headquartered in Moscow, Russia and is officially known as Public Stock Company (PSC) Tupolev. PSC Tupolev develop, manufacture and overhaul both civil and military aerospace products such as aircraft and weapons systems. They are also actively developing missile and naval aviation technologies, with more than 18,000 Tupolev aircraft produced for the USSR and the Eastern Bloc.

4



EMBRAER Embraer has become one of the main aircraft manufacturers in the world by focusing on specific market segments with high growth potential in commercial, defense, and executive aviation. Embraer is based in São José dos Campos, Brazil. LOCKHEED MARTIN Lockheed Martin Corporation is an American aerospace, defense, arms, security, and advanced technologies company with worldwide interests. It was formed by the merger of Lockheed Corporation with Martin Marietta in March 1995. It is headquartered in North Bethesda, Maryland, in the Washington, D.C., area. Lockheed Martin is one of the largest companies in the aerospace, military support, security, and technologies industry. It is the world's largest defense contractor, based on revenue. SUKHOI The JSC Sukhoi Company (Russian) was a major Soviet and now a Russian aircraft manufacturer, headquartered in Okrug, Moscow that designs both civilian and military aircraft. During February 2006, the Russian government merged Sukhoi with Mikoyan, Ilyushin, Irkut, Tupolev, and Yakovlev as a new company named United Aircraft Corporation. MIG Russian Aircraft Corporation "MiG” commonly known as Mikoyan and MiG, is a Russian aerospace and defence company headquartered in Begovoy District, Moscow. Mikoyan aircraft were frequently used in aerial confrontations with American and allied forces during and since the Cold War, and have become commonly featured aircraft in popular culture. Mikoyan aircraft are the most produced jet fighter family. In 2006, Mikoyan became a division of the United Aircraft Corporation in a merger with Ilyushin, Irkut, Sukhoi, Tupolev, and Yakovlev by decree of the Russian President Vladimir Putin. DASSAULT RAFALE The Dassault Rafale (French, literally meaning "gust of wind” and "burst of fire") is a French twin-engine, canard delta wing, multirole fighter aircraft designed and built by Dassault Aviation. Equipped with a wide range of weapons, the Rafale is intended to perform air supremacy, interdiction, aerial reconnaissance, ground support, in-depth strike, anti-ship strike and nuclear deterrence missions. The Rafale has been marketed for export to several countries, and was selected for purchase by the Indian Air Force, the Egyptian Air Force, the Qatar Air Force and the Hellenic Air Force. The Rafale has been used in combat over Afghanistan, Libya, Mali, Iraq and Syria. HINDUSTAN AERONAUTICS LIMITED (HAL) The Company which had its origin as Hindustan Aircraft Limited was incorporated on 23 Dec 1940 at Bangalore by Shri Walchand Hirachand, in association with the then Government of Mysore, with the aim of manufacturing aircraft in India. In March 1941, the Government of India became one of the shareholders in the Company and subsequently took over its management in 1942. In collaboration with the Inter-Continental Aircraft Company of USA, the Company commenced its business of manufacturing of Harlow Trainer, Curtiss Hawk Fighter and Vultee Bomber Aircraft. In January 1951, Hindustan Aircraft Limited was placed under the administrative control of Ministry of Defence, Government of India. The Company had built aircraft and engines of foreign design under licence, such as Prentice, Vampire & Gnat. It also undertook the design and development of aircraft indigenously. In August 1951, the HT-2 Trainer aircraft, designed and produced by the company under the able leadership of Dr. V.M.Ghatge flew for the first time. Over 150 Trainers were manufactured and supplied to the Indian Air Force and other customers. With the gradual

5



building up of its design capability, the company successfully designed and developed four other aircraft i.e. two seater 'Pushpak' suitable for flying clubs, 'Krishak' for Air Observatory Post (AOP) role, HF-24 Jet Fighter '(Marut)' and the HJT-16 Basic Jet Trainer '(Kiran)'. Meanwhile, in August 1963, Aeronautics India Limited (AIL) was incorporated as a Company wholly owned by the Government of India, to undertake manufacture of MiG-21 aircraft under licence. Factories were setup at Nasik (Maharashtra) & Koraput (Odisha). In June 1964, the Aircraft Manufacturing Depot which was set up in 1960 at Kanpur as an Air Force unit to produce the Airframe for the HS-748 transport aircraft was transferred to AIL. Soon thereafter, the Government decided to amalgamate Hindustan Aircraft Limited with AIL so as to conserve resources in the field of aviation where the technical talent in the country was limited and to enable the activities of all the aircraft manufacturing units to be planned and coordinated in a most efficient and economical manner. Amalgamation of the two companies i.e. Hindustan Aircraft Limited and Aeronautics India Limited was brought about on 1st Oct 1964 by an Amalgamation Order issued by the Government of India and the Company after the amalgamation was named as "Hindustan Aeronautics Limited (HAL)" with its principal business being design, development, manufacture, repair and overhaul of aircraft, helicopters, engines and related systems like avionics, instruments and accessories. In 1970, a separate division was set up exclusively for manufacture of 'Chetak' and 'Cheetah' Helicopters in Bangalore under licence from M/s SNIAS, France. Marut, Kiran, Ajeet, Chetak, Cheetah and Jaguar are some of the brands of HAL. Similar type of arrangement was agreed with USSR authorities for manufacture of accessories for MiG-21 series of aircraft. In 1976, projects were sanctioned for design & development of the HPT-32 elementary piston engine trainer, Kiran MK II (an improved version of Kiran MK I / IA) and Ajeet Trainer as well as for Advanced Light Helicopter. In 1982, the Company entered into an agreement with USSR and started production of Swing-wing MiG-27M aircraft as a follow on project for MiG-21 BIS at Nasik Division of the Company. During 1983, Korwa Division of HAL in District Sultanpur (U.P.) was established for manufacture of Inertial Navigation System (INS). HAL is actively engaged and is contributing to the space programmes of the country. A separate Aerospace division was established in 1988. HAL is currently meeting the requirements of structures for aerospace launch vehicles and satellites of ISRO through the Division. Infrastructure has also been set up to undertake complete assembly of the strap-on L-40 stage booster. Structures for GSLV Mk.III, Mars Mission and Human crew module have been supplied by HAL to ISRO. HAL is also setting up dedicated facility for manufacture of cryogenic engines. With the signing of an agreement with Russian partners to take up licence manufacture of SUKHOI 30 MKI Aircraft, Nasik Division, which had been engaged in manufacture & overhaul of MiG series Aircraft, had to be expanded. The in house development of Light Combat Aircraft (LCA) will give major boost to the modernization program of our Defence Services. For production of LCA, a separate LCA Tejas Division was established at Bangalore in March 2014. A new integrated facility for manufacturing of indigenous Light Utility Helicopter (LUH) is coming up at Tumakuru near Bengaluru for which the foundation stone was laid on 3rd January 2016. HAL has successfully flown Light Utility Helicopter (LUH) from the Greenfield Helicopter Manufacturing facility, Tumakuru on 29th Dec 2018. HAL was listed on BSE and NSE on 28th March 2018.

--------------------------------

6



Practice Questions ---------------------------------------------------------------------------------------------------- Q1. Which of the following are the only players in world in large size aircraft manufacturing? a) Airbus & Boeing b) Airbus, Boeing, UTC c) Airbus, Boeing, UTC, GE d) Airbus, Boeing, UTC, GE, Bombardier Q2. The top most nation in aircraft manufacturing industry is a) USA b) European Union c) UK d) Russia Q3. The largest airspace company is a) Airbus b) Boeing c) Lockheed Martin d) United Technologies Q4. Dassault Aviation is aircraft manufacturing company based in a) USA b) UK c) France d) Russia Q5. Rafale fighter jets are manufactured by a) Mig b) Boeing c) Dassault Aviation d) Lockheed Martin Q6. Bombardier is aircraft manufacturing company based in a) USA b) EU c) Russia d) Canada Q7. Embraer is aircraft manufacturing company based in a) USA b) EU c) Brazil d) Canada Q8. Comac is aircraft manufacturing company based in a) USA b) China c) Brazil d) Canada Q9. Which of the following aircraft manufacturing companies intend to become competitor of Airbus &

Boeing? a) Comac and Mitsubishi b) Comac and UAC c) Mitsubishi and UAC d) Comac and Embraer Q10. MiG is aerospace company based in a) London b) Moscow c) Washington d) Paris Q11. MiG (Mikoyan) recently became part of a) UAC b) Airbus c) Boeing d) Lockheed Martin Q12. Which of the following is largest defence aerospace manufacturer in the world? a) Rafale b) Dassault c) Lockheed Martin d) Boeing Q13. Lockheed Martin is largest defence aerospace manufacturer based in a) Russia b) China c) EU d) USA Q14. Lockheed Martin is largest defence aerospace manufacturer with head quarter based in a) New York b) Paris c) Washington DC d) London

7



Q15. Boeing is American airline company with head quarter based in a) New York b) Chicago c) Washington d) London Q16. Which of the following is NOT the global manufacturer of civil aircrafts? a) Airbus b) Boeing c) GE d) Tupoloev Q17. State run manufacturer of aircraft HAL was incorporated on a) 23 Dec 1940 b) 15 Dec 1947 c) 21 Dec 1955 d) 26 Dec 1960 Q18. HAL has its head quarter in a) New Delhi b) Mumbai c) Hyderabad d) Bangalore Q19. HAL commenced its business at the time of its creation with which of the following companies? a) Intercontinental aircraft company USA b) Airbus c) Boeing d) Sukhoi Q20. HAL was formed after amalgamation of which of the following companies? a) Hindustan Aircraft Limited and Aeronautics India Limited b) Hindustan Airlines and Aeronautics India Limited c) Hindustan Aircraft Limited and Aeronautics Airlines d) Hindustan Aircraft Limited and Aeronautics & Aircraft Limited Q21. Which of the following is NOT one of the brands of HAL? a) Chetak b) Cheetah c) Jaguar d) Panther Q22. What is the name of light combat aircraft manufactured by state owned HAL? a) Dhruv b) Nishant c) Akash d) Tejas

------------------------------

8



Explanations ---------------------------------------------------------------------------------------------------- 1. Ans a) Airbus and Boeing, the world's only major large passenger aircraft manufacturers, dominate the airline supply

industry with their established brands, Boeing's 7-series and Airbus's A-series of jets. 2. Ans a)

3. Ans a)

4. Ans c) Dassault Aviation is French based aircraft manufacturing company. 5. Ans c) The Dassault Rafale (French, literally meaning "gust of wind” and "burst of fire") is a French twin-engine,

canard delta wing, multirole fighter aircraft designed and built by Dassault Aviation. 6. Ans d) Bombardier, based in Canada, and Embraer, a Brazilian aircraft manufacturer, are leaders in the regional and

business airplanes market, focusing on smaller-sized jets. 7. Ans c) Bombardier, based in Canada, and Embraer, a Brazilian aircraft manufacturer, are leaders in the regional and

business airplanes market, focusing on smaller-sized jets. 8. Ans b) Newer airline suppliers include Comac in China, Mitsubishi in Japan and UAC in Russia.

9



9. Ans b) Comac and UAC are working on a series of new wide-body jets in a joint venture that they hope will eventually

make them a legitimate competitor to the dominance of Airbus and Boeing in the large-jet space. 10. Ans b) Russian Aircraft Corporation "MiG” commonly known as Mikoyan and MiG, is a Russian aerospace and

defence company headquartered in Begovoy District, Moscow. Mikoyan aircraft are the most produced jet fighter family.

11. Ans a) In 2006, Mikoyan became a division of the United Aircraft Corporation in a merger with Ilyushin, Irkut,

Sukhoi, Tupolev, and Yakovlev by decree of the Russian President Vladimir Putin. 12. Ans c) Lockheed Martin is one of the largest companies in the aerospace, military support, security, and technologies

industry. It is the world's largest defense contractor, based on revenue. 13. Ans d) Lockheed Martin Corporation is an American aerospace, defense, arms, security, and advanced technologies

company with worldwide interests. 14. Ans c) It was formed by the merger of Lockheed Corporation with Martin Marietta in March 1995. It is headquartered

in North Bethesda, Maryland, in the Washington, D.C., area. 15. Ans b) The Boeing Company is an American multinational corporation that designs, manufactures, and sells airplanes,

rotorcraft, rockets, satellites, telecommunications equipment, and missiles worldwide. Boeing is among the largest global aerospace manufacturers; it is the second-largest defense contractor in the world based on 2018 revenue and is the largest exporter in the United States by dollar value. The Boeing Company has its corporate headquarters in Chicago, Illinois.

16. Ans c) Airbus, Boeing and Tupoloev mainly manufacturer the wide-body and narrow-body jet airliners, while

Bombardier and Embraer concentrate on regional airlines. There are five major manufacturers of civil transport aircraft these include:

Airbus Boeing Bombardier Embraer Tupoloev

17. Ans a) The Company which had its origin as Hindustan Aircraft Limited was incorporated on 23 Dec 1940 at

Bangalore by Shri Walchand Hirachand, in association with the then Government of Mysore, with the aim of manufacturing aircraft in India. In March 1941, the Government of India became one of the shareholders in the Company and subsequently took over its management in 1942.

18. Ans d) HAL has its head quarter in Bangalore 19. Ans a) In collaboration with the Inter-Continental Aircraft Company of USA, the Company commenced its business of

manufacturing of Harlow Trainer, Curtiss Hawk Fighter and Vultee Bomber Aircraft. 20. Ans a) Amalgamation of the two companies i.e. Hindustan Aircraft Limited and Aeronautics India Limited was

brought about on 1st Oct 1964 by an Amalgamation Order issued by the Government of India and the Company after the amalgamation was named as "Hindustan Aeronautics Limited (HAL)".

10



21. Ans d) In 1970, a separate division was set up exclusively for manufacture of 'Chetak' and 'Cheetah' Helicopters in

Bangalore under licence from M/s SNIAS, France. Marut, Kiran, Ajeet, Chetak, Cheetah and Jaguar are some of the brands of HAL. Similar type of arrangement was agreed with USSR authorities for manufacture of accessories for MiG-21 series of aircraft.

22. Ans d) Tejas is the name of light combat aircraft being manufactured by Hindustan Aeronautical Limited (HAL). The

in house development of Light Combat Aircraft (LCA) will give major boost to the modernization program of our Defence Services. For production of LCA, a separate LCA Tejas Division was established at Bangalore in March 2014.

------------------------------------

1



AAI Airport Operations

Elements & Significance of Principles of Business Management

Evolution of Management Principles Principles are general propositions, which are applicable when certain conditions are present. These have been developed on the basis of observation and experimentation as well as personal experiences of the managers. Depending upon how they are derived and how effective they are in explaining and predicting managerial behaviour, they contribute towards the development of management both as a science and as an art. Derivation of these principles may be said to be a matter of science and their creative application may be regarded as an art. These principles lend credibility of a learnable and teachable discipline to the practice of management. These principles are guidelines to action. They denote a cause-and-effect relationship. While functions of management viz., Planning, Organizing, Staffing, Directing and Controlling are the actions to be taken while practicing management, Principles help managers to take decisions while performing these functions. The following points summarize the nature of principles of management. Elements of General Principles of Business Management Universal applicability: The principles of management are intended to apply to all types of organisations

business as well as non-business small as well large public sector as well as private sector manufacturing as well as the services sectors

However, the extent of their applicability would vary with the nature of the organisation, business activity, scale of operations and the like. For example, for greater productivity, work should be divided into small tasks and each employee should be trained to perform his/her specialised job. This principle is applicable to a government office where there is a diary/dispatch clerk whose job is to receive and send mail or documents, a data entry operator whose task is to input data on the computer, a peon and an officer etc. This principle is also applicable to a limited company where there are separate departments like Production, Finance, Marketing and Research and Development etc. Extent of division of work, however, may vary from case to case.

2



General Guidelines: The principles are guidelines to action but do not provide readymade, straitjacket solutions to all managerial problems. This is so because real business situations are very complex and dynamic and are a result of many factors. However, the importance of principles cannot be underestimated because even a small guideline helps to solve a given problem. For example, in dealing with a situation of conflict between two departments, a manager may emphasize the primacy of the overall goals of the organisation. Formed By Practice And Experimentation: The principles of management are formed by experience and collective wisdom of managers as well as experimentation. For example, it is a matter of common experience that discipline is indispensable for accomplishing any purpose. This principle finds mention in management theory. On the other hand, in order to remedy the problem of fatigue of workers in the factory, an experiment may be conducted to see the effect of improvement of physical conditions to reduce stress. Flexible: The principles of management are not rigid prescriptions, which have to be followed absolutely. They are flexible and can be modified by the manager when the situation so demands. They give the manager enough discretion to do so. For example, the degree of concentration of authority (centralization) or its dispersal (decentralization) will depend upon the situations and circumstances of each enterprise. Moreover, individual principles are like different tools serving different purposes, the manager has to decide which tool to use under what circumstances. Mainly Behavioural: Management principles aim at influencing behaviour of human beings. Therefore, principles of management are mainly behavioural in nature. It is not that these principles do not pertain to things and phenomenon at all, it is just a matter of emphasis. Moreover, principles enable a better understanding of the relationship between human and material resources in accomplishing organisational purposes. For example, while planning the layout of a factory, orderliness would require that workflows are matched by flow of materials and movement of men. Cause And Effect Relationships: The principles of management are intended to establish relationship between cause and effect so that they can be used in similar situations in a large number of cases. As such, they tell us if a particular principle was applied in a particular situation, what would be its likely effect. The principles of management are less than perfect since they mainly apply to human behaviour. In real life, situations are not identical. So, accurate cause and effect relationships may be difficult to establish. However, principles of management assist managers in establishing these relationships to some extent and are therefore useful. In situations of emergencies, it is desirable that someone takes charge and others just follow. But in situations requiring cross-functional expertise, such as setting up of a new factory, more participative approach to decision-making would be advisable. Contingent: The application of principles of management is contingent or dependent upon the prevailing situation at a particular point of time. The application of principles has to be changed as per requirements. For example, employees deserve fair and just remuneration. But what is just and fair is determined by multiple factors. They include contribution of the employee, paying capacity of the employer and also prevailing wage rate for the occupation under consideration. Significance of Principles of Management The principles of management derive their significance from their utility. They provide useful insights to managerial behaviour and influence managerial practices. Managers may apply these principles to fulfil their tasks and

3



responsibilities. Principles guide managers in taking and implementing decisions. It may be appreciated that everything worthwhile is governed by an underlying principle. The quest of the management theorists has been and should be to unearth the underlying principles with a view to using these under repetitive circumstances as a matter of management habit. The significance of principles of management can be discussed in terms of the following points: Providing managers with useful insights into reality: The principles of management provide the managers with useful insights into real world situations. Adherence to these principles will add to their knowledge, ability and understanding of managerial situations and circumstances. It will also enable managers to learn from past mistakes and conserve time by solving recurring problems quickly. As such management principles increase managerial efficiency. For example, a manager can leave routine decision-making to his subordinates and deal with exceptional situations which require her/his expertise by following the principles of delegation. Optimum utilization of resources and effective administration: Resources both human and material available with the company are limited. They have to be put to optimum use. By optimum use we mean that the resources should be put to use in such a manner that they should give maximum benefit with minimum cost. Principles equip the managers to foresee the cause-and-effect relationships of their decisions and actions. As such the wastages associated with a trial-and-error approach can be overcome. Effective administration necessitates personalization of managerial conduct so that managerial power is used with due discretion. Principles of management limit the boundary of managerial discretion so that their decisions may be free from personal prejudices and biases. For example, in deciding the annual budgets for different departments, rather than personal preferences, managerial discretion is bounded by the principle of contribution to organisational objectives. Scientific decisions: Decisions must be based on facts, thoughtful and justifiable in terms of the intended purposes. They must be timely, realistic and subject to measurement and evaluation. Management principles help in thoughtful decision-making. They emphasize logic rather than blind faith. Management decisions taken on the basis of principles are free from bias and prejudice. They are based on the objective assessment of the situation. Meeting Changing Environment Requirements: Although the principles are in the nature of general guidelines but they are modified and as such help managers to meet changing requirements of the environment. You have already studied that management principles are flexible to adapt to dynamic business environment. For example, management principles emphasize division of work and specialization. In modern times this principle has been extended to the entire business whereby companies are specializing in their core competency and divesting non-core businesses. In this context, one may cite the decision of Hindustan Lever Limited in divesting non-core businesses of chemicals and seeds. Some companies are outsourcing their non-core activities like share-transfer management and advertising to outside agencies. So much so, that even core processes such as R&D, manufacturing and marketing are being outsourced today. Haven’t you heard of proliferation of ‘Business Process Outsourcing’ (BPO) and ‘Knowledge Process Outsourcing’ (KPO)? Fulfilling Social Responsibility: The increased awareness of the public, forces businesses especially limited companies to fulfill their social responsibilities. Management theory and management principles have also evolved in response to these demands. Moreover, the interpretation of the principles also assumes newer and contemporary meanings with the change in time. So, if one were to talk of ‘equity’ today, it does not apply to wages alone. Value to the customer, care for the environment, dealings with business associates would all come under the purview of this principle.

4



Management Training, Education And Research: Principles of management are at the core of management theory. As such these are used as a basis for management training, education and research. These principles provide basic groundwork for the development of management as a discipline. Professional courses such as MBA (Master of Business Administration), BBA (Bachelor of Business Administration) also teach these principles as part of their curriculum at the beginner’s level. These principles enable refinement of management practices as well by facilitating the development of new management techniques. Thus, we see that techniques like Operations Research (OR), cost accounting, ‘Just in Time’, ‘Kanban’ and ‘Kaizen’ have developed due to further research on these principles. In conclusion it can be said that understanding the meaning, nature and significance of principles of management will help us to appreciate their applicability in real life situations.

------------------------------------------

5



Practice Questions ---------------------------------------------------------------------------------------------------- Q1. Which of the following is NOT element of general principle of business management? a) Universal Applicability b) General Guidelines c) Objectively used in all situations d) Formed by experimentation Q2. General Principles of management have universal applicability, which means a) Are applicable on all the individuals b) Have same impact everywhere c) Applicable in all types of the organisations d) Are absolute in nature Q3. Which of the following statements is NOT correct related to principles of general management? a) These are guidelines provided to take decision b) These are made through experimentations c) These guidelines always solve the real problems faced by organisation d) Help the managers Q4. The main reason why principles of business management are NOT absolute is a) These are related to human behavior b) These are NOT universal c) These are not subjective d) These are not scientific Q5. Principles of Business management can’t establish accurate cause effect relationship because a) these are not scientific b) these are not objective c) these are not made through experimentation d) real life situations may be different from otherwise predicted Q6. Principles of business management are contingent which means a) These are not accurate in all situations b) These can’t be applied on everyone c) These are situational d) These are not exact Q7. Which of the following may not be significance of principle of business management? a) Provide important insight to managerial behavior b) Help the managers in solving problem c) Help the managers to take decision d) Help to formulate organisational policies Q8. Principles of business management help in fulfilling the social responsibility which means a) care for society and environment b) care of employees c) care for customers d) work for social motive rather than profit motive

---------------------------------

6



Explanations ---------------------------------------------------------------------------------------------------- 1. Ans c) Principles of business management can’t be used objectively in all the situations since every situation has

different requirement and demand. These principles are not the objective statements but the subjective one. 2. Ans c) Universal applicability: The principles of management are intended to apply to all types of organisations

business as well as non-business small as well large public sector as well as private sector manufacturing as well as the services sectors

However, the extent of their applicability would vary with the nature of the organisation, business activity, scale of operations and the like. For example, for greater productivity, work should be divided into small tasks and each employee should be trained to perform his/her specialised job. This principle is applicable to a government office where there is a diary/dispatch clerk whose job is to receive and send mail or documents, a data entry operator whose task is to input data on the computer, a peon and an officer etc. This principle is also applicable to a limited company where there are separate departments like Production, Finance, Marketing and Research and Development etc. Extent of division of work, however, may vary from case to case.

3. Ans c) General guidelines: The principles are guidelines to action but do not provide readymade, straitjacket

solutions to all managerial problems. This is so because real business situations are very complex and dynamic and are a result of many factors. However, the importance of principles cannot be underestimated because even a small guideline helps to solve a given problem. For example, in dealing with a situation of conflict between two departments, a manager may emphasize the primacy of the overall goals of the organisation.

Formed by practice and experimentation: The principles of management are formed by experience and collective wisdom of managers as well as experimentation. For example, it is a matter of common experience that discipline is indispensable for accomplishing any purpose. This principle finds mention in management theory. On the other hand, in order to remedy the problem of fatigue of workers in the factory, an experiment may be conducted to see the effect of improvement of physical conditions to reduce stress.

Flexible: The principles of management are not rigid prescriptions, which have to be followed absolutely. They are flexible and can be modified by the manager when the situation so demands. They give the manager enough discretion to do so. For example, the degree of concentration of authority (centralization) or its dispersal (decentralization) will depend upon the situations and circumstances of each enterprise. Moreover, individual principles are like different tools serving different purposes, the manager has to decide which tool to use under what circumstances.

4. Ans a) Mainly behavioural: Management principles aim at influencing behaviour of human beings. Therefore,

principles of management are mainly behavioural in nature. It is not that these principles do not pertain to things and phenomenon at all, it is just a matter of emphasis. Moreover, principles enable a better understanding of the relationship between human and material resources in accomplishing organisational purposes. For example, while planning the layout of a factory, orderliness would require that workflows are matched by flow of materials and movement of men.

5. Ans d) Cause and effect relationships: The principles of management are intended to establish relationship between

cause and effect so that they can be used in similar situations in a large number of cases. As such, they tell us if a particular principle was applied in a particular situation, what would be its likely effect. The principles of management are less than perfect since they mainly apply to human behaviour. In real life, situations are not

7



identical. So, accurate cause and effect relationships may be difficult to establish. However, principles of management assist managers in establishing these relationships to some extent and are therefore useful. In situations of emergencies, it is desirable that someone takes charge and others just follow. But in situations requiring cross-functional expertise, such as setting up of a new factory, more participative approach to decision-making would be advisable.

6. Ans c) Contingent: The application of principles of management is contingent or dependent upon the prevailing

situation at a particular point of time. The application of principles has to be changed as per requirements. For example, employees deserve fair and just remuneration. But what is just and fair is determined by multiple factors. They include contribution of the employee, paying capacity of the employer and also prevailing wage rate for the occupation under consideration.

7. Ans d) 8. Ans a) Fulfilling social responsibility: The increased awareness of the public, forces businesses especially limited

companies to fulfill their social responsibilities. Management theory and management principles have also evolved in response to these demands. Moreover, the interpretation of the principles also assumes newer and contemporary meanings with the change in time. So, if one were to talk of ‘equity’ today, it does not apply to wages alone. Value to the customer, care for the environment, dealings with business associates would all come under the purview of this principle.

-----------------------------

Knowledge On Aircraft Manufacturing Companies...Aerospace technology & capital intensive industry. The aircraft industry is the industry supporting aviation by building aircraft and

Documents