Class 12 Business Administration Notes · GSEB
Areas of Management
Areas of Management — study the four specialised domains of production, marketing, human resources and finance. GSEB Class 12 Commerce notes with full function lists, the marketing mix and HRM importance points.
Last updated: 23 Oct 2026
Notes
Four Specialised Areas at a Glance
Notes — the key lines
- Every business runs the general functions; as it grows, management specialises into areas.
- The chapter teaches four: production, marketing, human resource, financial.
- Each area has its own definition and its own function list — learn them as four separate answers.
Planning and the general functions are carried out in every business; as organisations grow, management specialises into functional areas. This chapter covers four:
Production management — converting naturally available raw material into consumable finished goods with the help of human efforts.
Trap — These four are **specialised areas**, not the five management functions — mixing the two lists is the commonest error on this page.
Production Management
Notes — the key lines
- Production management converts naturally available raw material into consumable finished goods with human effort.
- It covers planning, programmes, co-ordination, direction and control of production.
- Its ten functions run from the production plan to quality, cost and productivity control.
Process of conversion of naturally available raw material into consumable finished goods with the help of human efforts is known as production. Production management produces goods and services, which are capable to satisfy customers' need.
To decide production plan.
To undertake production research.
To select product development as well as product-mix.
To select technology and machinery.
To take decisions regarding selection of location as well as layout.
To estimate required material and other needs for production.
To have production control.
To have quality control.
To undertake activities to control expenditure or cost and to maintain and increase productivity.
To introduce variation and simplification in production.
Trap — Production management is not only "making goods" — **product-mix, layout, quality and cost control** are all inside it.
Marketing Management
Notes — the key lines
- Marketing management carries goods and services from producer to customer by first deciding customer need.
- It works through the marketing mix: product, price, distribution, promotion.
- Product-mix covers appearance, colour, size, shape, weight, print, packing, guarantee, after-sales service and variety.
In a broad sense, marketing management is the activity of providing goods or services from producers to customers. Marketing management includes exchange of goods with money as well as market research, distributive method, sales promotion, storage, insurance, etc.
The decision regarding development of new product or existing product includes appearance, colour, size, shape, weight, print, packing, guarantee of work, after sales services, variety of product, etc.
In modern times, a customer expects availability of better quality of goods at reasonable rate. Therefore utmost care should be taken while deciding the price of the product. The price decision includes sales policy, credit policy, policy regarding discount, wholesale or retail sale and also commission to mediators, etc.
Distribution-mix include decisions regarding various ways of selling like direct selling, through the wholesaler, retailers, agents, as well as problems related to transportation, etc. Distribution-mix is related to the size and scope of a business unit.
Promotion aims at remarkable increase in sale. It includes the matters like advertisement, publicity, selling through salesmen, ways and means to attract customers and traders etc. Though promotion mix is expensive, it leads to increase in sale, which results into higher profitability.
Key Takeaways
- Product-mix includes appearance, colour, size, shape, weight, print, packing, guarantee of work, after sales services and variety of product.
Price in practice — The price decision includes sales policy, credit policy, policy regarding discount, wholesale or retail sale and also commission to mediators, etc.
Trap — Promotion is the **most visible** element, not the only one — an answer that lists only advertising has answered one quarter of the mix.
Human Resource Management
Notes — the key lines
- Employees are the live asset of a business; HRM integrates their proficiency, knowledge and needs with business objectives.
- Seven characteristics: selection and training, objective integration, asset management, development, evaluation, low labour turnover, conducive atmosphere.
- Nine importance points run from efficiency and profitability to job satisfaction and industrial peace.
Every business unit takes care of its assets like land, building, machinery, furniture and vehicles. Employees working in the business unit are its live asset. Therefore it is necessary to take care of them. Success of a business depends on the employees. Business objectives can easily and successfully be achieved if their needs are satisfied, a conducive environment is provided and proper care is taken. Due to such care, enthusiasm, loyalty and feeling of oneness among employees develops. It increases their work efficiency.
Key Takeaways
- Human resource management includes selection, training, promotion and direction to the employees.
- Human resource management enables to accomplish business objectives by way of integrating them with individual objectives and business objectives.
- Basic function of human resource management is to manage the employees as they are valuable assets of the business.
- It provides proper training and thus develops personnel for the job.
- Human resource management evaluates performance of employees and places them at right position.
- Efficient management can reduce labour turnover rate and can maintain skillful employees for a longer period in company.
- As part of Human resource management, a conducive atmosphere is provided to employees, which ultimately boosts their enthusiasm and efficiency. The values of the company are maintained and business objectives are achieved.
Key Takeaways
- Efficiency of employees tends to increase.
- Profitability of the business increases.
- Business prestige is maintained.
- Higher standards for the quality of goods or services are maintained.
- Feeling of oneness among employees is developed.
- Maximum utilisation of factors of production is possible.
- Reduction in labour turnover rate is seen.
- Job satisfaction among the employees is enhanced.
- Due to human resource management, employees get job satisfaction which finally turns into an environment of industrial peace.
- Human resource management increases efficiency, profitability, prestige, quality, oneness, resource utilisation and job satisfaction while reducing labour turnover.
Read the two lists together: the characteristics describe what HRM does, and the importance points describe what the business gains.
Trap — **Repairing and maintenance of machinery is not HRM** — it is a bottom-level supervisory function; HRM deals with people.
Financial Management
Notes — the key lines
- Finance is the lifeblood of business — no activity is possible without it.
- Financial management handles the acquisition, utilisation and allocation of capital, ideally and efficiently.
- Its ten functions run from estimating needs and budgeting to capital structure, tax planning and assets.
Finance is like the lifeblood of business. No activity is possible without finance. Finance is required for the establishment, development, expansion and modernisation of a business.
To estimate the financial needs.
To make financial plans from the point of view of time duration.
To prepare budget.
To allocate funds.
To decide capital structure and to select sources of acquisition of capital.
To carry out the procedure for acquiring the finance.
To see that the acquired funds are properly utilised and to keep control over financial activities.
To form financial policy.
To plan for taxes.
To make arrangement of assets.
Trap — Financial management is not only **raising** money — allocation, utilisation and control are equally part of the function.
60-Second Recap
Key Takeaways
- Production · marketing · HR · finance.
- Plan → research → product-mix → technology → layout → control → quality → cost.
- Need → product → price → distribution → promotion.
- Select → train → evaluate → place → satisfy → retain.
- Estimate → plan → budget → allocate → acquire → control → policy → tax → assets.
Exam Questions
Exam Questions
Answer in the marks band shown. Try before you reveal.