Justify the following statements.

1) Principles of management are flexible in nature.
Solution: 

(1) Principles of management are the statements of fundamental truth which act as guidelines for managerial decision-making and action. They establish cause and effect relationships. They are evolved through observation, analysis, and experiments.

(2) Principles of management although fundamental, are not rigid. They are flexible in nature in the sense they can be changed or modified according to the situation and requirements of the organization. Managers can change these principles to suit the requirements of the organization.

(3) Principles of management are flexible guidelines providing ample scope for making changes according to the nature of the enterprise, its size, competitive situation, etc. For instance, in the context of the present business scenario, in many places, the ‘family management has been substituted by professional management.

(4) The modern business world is dynamic. The situations in a business enterprise keep on changing continuously. No two circumstances are identical. Principles of management can be changed, adjusted or modified, and used in the enterprise as per its changing needs and requirements. By identifying problems of business changes will be accepted.

2) Management principles are helpful in optimum utilization of resources.
Solution: 

(1) Materials or abstract qualities that a person or organization uses to perform the work are called resources, e.g. tools, stocks, time, employees, etc. In every organization, two types of resources are used and they are
(i) Physical resources such as material, machine, money, etc. 
(ii) Human resources i.e. manpower.

(2) The different types of resources are used in the organization to manufacture or produce different types of goods and services. The resources are scarce in relation to their demand and therefore resources should not be wasted and misused. They should be used carefully and up to their optimum capacity.

(3) The basic aim and function of management are to make and maintain proper balance and allocate these resources by putting them to maximum possible use and control on wastage of resources. Through the use of different techniques and management principles, management maintains discipline and a healthy working environment to establish a cordial relationship with the employees.

(4) It helps to increase the efficiency level of employees and to manage the administration effectively, e.g. use of modern and standard tools and machinery. It also helps to increase quality, productivity, and level of efficiency of human resources.

3) Principle of equity is important.
Solution: 

(1) The principle of equity suggests that employers should give kind, fair, just, and equal treatment to the employees. Managers should be kind, impartial, and fair to their subordinates.

(2) The principle of equity further states that there should not be any discrimination between the employees while making the payment of wages. The employees working on the same level but in different departments should be paid the same wages.

(3) The wages payable to employees should not depend on the departments but the level at which they are working, e.g. Foremen should be paid higher wages than that is paid to employees working under them.

(4) The principle of equity also states that there should not be any discrimination between the employees while distributing work between them. As far as possible, there should be an equal distribution of work. Thus, equality in the treatment of employees boosts morale and develops a sense of belongingness among the employees. It helps to develop loyalty of employees towards the organisation and avoid conflicts.

4) Taylor emphasized on standardization of tools and equipment.
Solution: 

(1) Frederick Winslow Taylor published Principles of Scientific Management. Its primary objective was to increase efficiency of employees by scientifically designing jobs. According to his views, management problems should be solved through experiments and use of scientific techniques rather than rules of thumb and trial and error approach.

(2) Taylor had conducted many experiments at workplace and as a result of those experiments, he advocated standardization of tools and equipment. Standard here, means a level of quality or achievement, especially a level that is acceptable.

(3) According to him, a standardized working environment and standardized methods of production tools and equipment help to reduce spoilage and wastage of materials. This in turn reduces the overall cost of production.

(4) Similarly, the use of standardized tools and equipment increases the efficiency of employees and also helps to reduce fatigue among the workers. This improves the quality of work.

5) A differential piece wage rate plan is necessary.
Solution: 

(1) According to F. W. Taylor, the differential piece wage rate plan is necessary to motivate the employees to attain higher standard performance and to earn remuneration at a higher rate. Differential piece wage rate plan suggests that remuneration should be fixed and paid in such a way that average worker is motivated to attain standard output.

(2) In the differential piece wage rate plan, the standard is determined for production by the management. The workers who produce more than the standard are to be paid more in the form of incentives and those who produce less than the standard are to be paid less by way of penalty. This technique encourages those who perform well and motivates those who have performed less than the standard required to improve their performance.

(3) Taylor suggested the differential piece wage system and further stated that the discrimination should be made between the efficient and inefficient workers. This technique explains that efficient workers should be paid more remuneration in comparison to inefficient workers.

(4) Thus, the differential piece-rate wage plan technique motivates the able employees to attain higher performance and earn wages at a higher rate.