Organizational Structures, Functions of management, Types of production, Job Enrichment/Enlargement, Project life cycle, Productivity management, Productivity management.

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Industrial Management
4 basic types of organizational structures, its characteristics,
advantages and disadvantages:
4 basic types of organizational structures:
1. Functional Structure
2. Divisional Structure
3. Matrix Structure
4. Project organizational structure
1. Functional organizational structure:
This kind of organizational structure classifies people according to the
function they perform in the organization.
Characteristics:
i) The whole task of the enterprise is divided into specialized functions.
ii) Each function is performed by a specialist.
iii) The specialist of a functional department has the authority over all
other employ-ees for his function.
iv) The specialists operate with considerable independence.

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Advantages:
i) Specialization:
Functional organization ensures a logical division of work. This
results in specialization of functions. Every functional manager is an
expert in his area and all workers get the benefit of his expertise.
ii) High Degree of Efficiency:
Every employee in the organization concentrates on one function
only and receives the expert guidance from the specialists. As a
result, efficiency of operation becomes high.
iii) Reduction of Work Load:
Every functional head looks after one function only and, so, the work
burden on the top executive is reduced. It ensures the separation of
mental and manual functions.
iv) Better Control:
In functional organization there is joint supervision of work. As a
result, functional control becomes more effective in comparison with
line or staff organization.
Disadvantages:
Functional organization suffers from the following disadvantages:
i) Complexity:
There are many cross-relationships which create confusion. A
worker may receive conflicting orders.
ii) Absence of Unity of Command:
In such organization a person is accountable to several superiors.
As a result, responsibility for results cannot easily be fixed
iii) Lack of Co-ordination:
It is too complicated in operation because it entails the division of
functions into a number of sub-functions. This leads to lack of co-
ordination among the workers and functions.
iv) Delay in Decision-making:
Arriving at a decision requires the involvement of sev-eral
specialists. So, decision-making process in functional organization
is slow.
v) Expensive:
In functional organization a large number of specialists are
required. Therefore, it is expensive.

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2. Divisional Organizational Structure:
A type of organizational configuration that groups together those
employees who are responsible for a particular product type or market
service according to work flow.
The divisional structure of a business tends to increase flexibility, and it
can also be broken down further into product, market and geographic
structures.
Characteristics:
i) Every division would handle its own accounting activities, sales
and marketing, engineering, production, and so forth.
ii) All division is focusing on a single product or service line.
iii) Division are responsible for a product or service, a geographical
location, or a customer group.
Advantages:
i) Accountability is clear.
ii) Creates career development chances.
iii) Quick response to environmental changes.
iv) Increased focus on products and markets.
v) Higher quality products and customer service.

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Disadvantages:
i) Can be very expensive as there is duplication of work and
resources.
ii) Differences in image and quality may occur across divisions.
iii) Requires a skilled management force.
iv) Requires an elaborate control system.
v) Can lead to limited sharing of ideas and resources.
vi) Can lead to dysfunctional competitions among divisions.
vii) Lack of Specialization.
3. Matrix Organizational Structure:
It is most complex which has a combination of function and product
structures.
This combination makes both the best of both worlds to make an efficient
organizational structure.

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Characteristics:
i) Hybrid Structure: It combines functional organization with a
project organization.
ii) Functional Manager: The Functional Manager has authority over
the technical (functional) aspects of the project.
iii) Project Manager: The Project manager has authority over the
administrative aspects of the project. He has full authority over the
financial and physical resources which he can use for completing
the project.
iv) Problem of Unity of Command This is so, because the
subordinates receive orders from two bosses viz., the Project
Manager and the Functional Manager.
v) Specialization: In a Matrix organization, there is a specialization.
The project manager concentrates on the administrative aspects
of the project while the functional manager concentrates on the
technical aspects of the project.
Advantages:
i) Sound Decisions: In a Matrix Organization, all decisions are taken
by experts.
ii) Motivation: In a matrix organization, the employees work as a
team. So, they are motivated to perform better.
iii) Higher Efficiency: The Matrix organization results in a higher
efficiency. It gives high returns at lower costs.
iv) Increased project focus.
v) Optimum Utilization of Resources: In the matrix organization,
many projects are run at the same time. Therefore, it makes
optimum use of the human and physical resources.
Disadvantages:
i) Increase in Work Load: In a matrix organization, work load is very
high.
ii) High Operational Cost: In a matrix organization, the operational
cost is very high. This is because it involves a lot of paperwork,
reports, meetings, etc.

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iii) Absence of Unity of Command: In a matrix organization, there is
no unity of command. This is because, each subordinate has two
bosses, viz., Functional Manager and Project Manager.
iv) Complexity: Matrix organization is very complex and the most
difficult type of organization.
v) Morale: In a matrix organization, the morale of the employees is
very low. This is because they work on different projects at
different times.
4. Project organizational structure:
In a project-organizational structure, the teams are put together based on
the number of members needed to produce the product or complete the
project. The number of significantly different kinds of tasks are taken into
account when structuring a project in this manner, assuring that the right
members are chosen to participate in the project.

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Characteristics:
i) The project manager has full power and authority over resources
to be utilized in the project. He controls the budget, resources,
and work assignments.
ii) The project manager has full-time team members working under
his control who directly report him.
iii) When the project is completed the team is disbanded. Team
members and all other resources are released.
Advantages:
i) Since the team members directly report to the project manager,
there is a clear line of authority. This reduces conflict and makes
decision making faster and more flexible.
ii) Due to a single reporting system, there are shorter lines of
communication which creates strong and effective communication
within the project management team.
iii) Due to a single authority, less time is consumed in
communication, and the response to stakeholders’ concerns is
fast.
iv) Team members become versatile and flexible due to experience
in different kinds of projects.
Disadvantages:
i) There is a sense of insecurity among the team members, because
once the project is completed, they feel they may lose their jobs.
Therefore, they tend to be less loyal towards the organization.
ii) The cost of employees and equipment can be higher because you
may be hiring skilled people and specialized equipment for a
shorter period of time. Moreover, if the project gets stretched out,
the cost of equipment and other resources can be much higher.
iii) In projects, there is always a deadline and usually a tight
schedule, which makes the work environment stressful.

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Organizational Structure:
The typically hierarchical arrangement of lines of authority,
communications, rights and duties of an organization. Organizational
structure determines how the roles, power and responsibilities are
assigned, controlled, and coordinated, and how information flows
between the different levels of management.
Main Types of Organization Structure:
1. Line Organization:
2. Staff Organization:
3. Functional Organization:
4. Line and Staff Organization:
Explanation:
1. Line Organizational Structure:
Line Organization is the oldest and simplest form of organization structure.
It is also known as ‘Military Organization’, because it originated in the army. In
line organization, authority flows from the man at the top to the lowest man
vertically.
In other words, the directions are issued by the man-in-charge of the whole
organization and are di-rectly conveyed to the persons responsible for the
execution of the work.
The business unit may be divided into
departments headed by the departmental
managers. A departmental head receives orders
from the General Manager and passes them on
to his immediate subordinates. The
subordinates similarly communicate the orders
to the workers. The various persons head-ing
the different departments are perfectly
independent of each other and enjoy equal
status.

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Characteristics:
(i) Authority flows vertically from top to the bottom.
(ii) The command is given through a straight line.
(iii) Each subordinate receives orders from one superior and is
responsible to him only.
Advantages:
i) Strong Discipline: It ensures effective discipline. Each position is
under the direct control of its immediate superior. Therefore, it is
easy to maintain discipline among the peo-ple in the organization.
ii) Orderly Communication: Communication between the superiors
and subordinates flows in a direct vertical line. Such
communication is easy to maintain and it is orderly in nature.
iii) Effective Co-ordination: Since all activities relating to one
department are managed by one person, co-ordination can be
effective.
iv) Economical: Line organization is quite economical because staff
specialists are not required here.
Disadvantages:
i) Over-loading: Since the managers are overloaded with day-to-day
work, they do not find time for creativity and innovation.
ii) Lack of Specialization: It suffers from lack of specialization. A
manager has to perform a variety of functions. Any manager
cannot be equally good in all the functions and, therefore, the
quality of management tends to be poor.
iii) Low Morale: Subordinates opinions and complaints are not
properly communicated upwards.
2. Staff Organization:
Staff Organization means that type of organization in which some experts
are employed to execute the advisory functions. These experts act as the
advisors of the organization. The staff persons have no authority to
command and provide directions. They only give advice to the line
manager in various organizational aspects.

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Characteristics of Staff Organization:
i) The experts of the staff organization give specialized service to the line
organization.
ii) The staff organization is auxiliary in nature.
iii) It is an advisory body consisting of some functional experts.
iv) The staff people have no authority to command the line organization,
they can recommend only.
Line and Staff Organization:
Line and Staff Organization is a combination of Line Organization and
Staff Organization Structure. In such organization, line authority flows in a
vertical line in the same way as in the line organization and, in addition,
staff specialists are employed to advise the line managers for efficient
performance of the special functions.
The staff expert is advi-sory in nature and has only the authority to
recommend. He has no power over the line posi-tions. His main function
lies in rendering advice, assistance and making provision of specialized
service. Such type of organization structure is more popular specially in
large enterprises.

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Characteristics of Line and Staff Organization:
i) Two types of personnel exist in this form of structure, line
personnel and staff experts. It adds functional specialists with the
line organization.
ii) The staff members are only for giving assistance and specialized
advice to the line officers. The line officers have no binding to
accept their advice.
iii) The subordinate is answerable only to his immediate boss and not
to his staff specialist. So, line and staff organization, besides
following the principle of unity of command, also provides
specialization that leads to efficiency of work.
Advantages of Line and Staff Organization:
i) Specialized Advice: The line managers receive the benefit of
expert advice and assistance from the staff specialists. The staff
experts enable the line managers to discharge their
responsibilities more efficiently.
ii) Better Decisions: The staff specialists provide adequate
information and expert advice. As a result, the line managers can
take quality decisions.
iii) Flexibility: The line and staff organization are comparatively more
flexible. As the organization expands, staff specialists can be

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added to help the line executives. There is more opportunity for
advancement and growth.
iv) Reduction of Work-burden: The staff specialists carry out detailed
investigation and supply information to the line managers. So, the
work-load of the line managers is reduced.
Disadvantages of Line and Staff Organization:
i) Line-staff Conflicts: The main problem of line and staff
organization is that con-flicts and friction often arise between the
line executives and staff specialists.
ii) Expensive: The line and staff organization is expensive for small
enterprises, because two types of persons are to be employed
simultaneously for line and staff positions.
Management:
It is an art of getting things done through with other people. OR
It is a processing of creating an environment in which group of people
work together to achieve organization goals and objectives. OR
It is a process of planning, organizing, staffing, leading and controlling.
Tylor define management as “The process by which shared goals are
accomplished through utilization of human and other resources.
Main Objectives of management:
➢ Increases organization efficiency.
➢ To achieve optimum utilization of resources.
➢ To have coordination between various departments in organization.
➢ To reduce the execution time for various activities in the organization
➢ To control and manage economy aspect of organization.

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Different Functions of management in an organization:
Functions of management:
In general sense a manager performs the following functions:
i) Planning
ii) Organizing
iii) Staffing
iv) Controlling
v) Leading
Explanations:
i) Planning:
It deals with chalking out a future course of action & deciding in advance
the most appropriate course of actions for achievement of pre-determined
goals.
Thus, planning is a systematic thinking about ways & means for
accomplishment of pre-determined goals. Planning is necessary to
ensure proper utilization of human & non-human resources. It is all
pervasive, it is an intellectual activity and it also helps in avoiding
confusion, uncertainties.
In short planning means to pre-decide that:
➢ What to do?
➢ How to do?
➢ When to do?
➢ Why to do?
Example of planning:
Mr. Brown owns a Fashion Store in Islamabad. He has to install a security
system and also wind resistant windows. He also as to prepare a head of
the market for the expected trends.
Mr. Brown prepares for future events.

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ii) Organizing:
Organizing means grouping of activities. It is the process of bringing
together physical, financial and human resources and developing
productive relationship amongst them for achievement of organizational
goals.
Example:
After Mr. Brown has plan to meet the goals of his establishment he
decides put together all the records of purchases and sales in a special
folder.
iii) Staffing:
This function involves filling the vacancies with the right people.
It includes Recruiting, selecting, appointing the employees, assigning
duties, maintaining pleasant relationship and taking care of complaints of
employees, training and development of employees, deciding their salary,
promotion and increments.
The main purpose of staffing is to put right man on right job i.e. square
pegs in square holes and round pegs in round holes.
Example:
Mr. Brown decided to hire a sales representative. He also decided to train
some of existing employees with the required business ethics.
iv) Controlling:
This function involves monitoring employees’ activities, determining
whether the organization is on target in achieving its goals and making
corrections as necessary.
Example:

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Mr. Brown decides what is to have a 20% sale on items in the store for 3
weeks.
v) Leading or directing:
This function is concerned with getting people to perform assigned tasks
willingly and in an efficient and effective manner.
Example:
Mr. Brown assign tasks to the customer service attendant ensure all goals
are met and consumers are satisfied.
Job Production, Batch Production, Mass or Flow Production:
Job Production:
Job production is where a single item or product is made at a time. It is
associated with high quality goods, customized orders and unique items
for a specific customer.
Example:
A small cake shop makes its regular cakes in batches of up to 120.
Wedding cakes are high value items that are created one at a time. They
are always customized and are considered a creative product. Depending
on the order, staff may spend an entire shift on one cake.
Second example is a satellite used for scientific discovery has a unique
design that is only produced once.
Characteristics of job production:
i) A large number of general purpose machines are required.
ii) A large inventory of materials, parts and tools will be required.
iii) Volume of output is generally small

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iv) Skilled labors are required who can take up each job as a
challenge because of uniqueness.
v) Whole project is taken as a single operation.
Limitations of job production:
i) Production planning is complicated.
ii) Lager space is required.
iii) The demand is irregular for some products.
iv) Higher cost due to frequent set up changes.
v) The use of labour and equipment may be an inefficient.
Batch Production:
Batch production is a method of producing a number of items together in
a series of steps. It occurs when many similar items are produced
together.
Batch production is a method of production that creates several items at
the same time in a series of production steps. The items that are created
together are known as a batch.
Example:
A bakery produces a batch of 240 number of bread. The process involves
4 steps and the entire batch is moved from step to step together.
Second example is the production of cricket bat.

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Characteristics Batch Production:
i) The work is of repetitive nature.
ii) There is a functional layout of various manufacturing processes.
iii) One operation is carried out on whole batch and then is passed
on to the next operation and so on.
iv) Same type of machines is arranged at one place.
v) Division of labour is possible.
Limitations of Batch Production:
i) Material handling is complex because of irregular and longer
flows.
ii) Production planning and control is complex.
iii) Work in process inventory is higher compared to continuous
iv) production.
v) Higher set up costs due to frequent changes in set up.
Mass or flow production:
Mass or flow production is the production of goods at scale typically using
an assembly line. It is a continuous process whereby production steps are
run concurrently. Under this method, goods flow in production or
assembly line which pass from one stage to the next without a break
where the number of stages varies according to the product and there is a
worker/machine at each stage who does one operation.
Characteristics of mass or flow production:
i) The units flow from one operation point to another throughout the
whole process.
ii) There will be one type of machine for each process.
iii) Any fault in flow of production is immediately corrected otherwise
it will stop the whole production process.

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iv) Shorter cycle time of production.
v) Large volume of products
vi) Production planning and control is easy.
vii) The products, tools, materials and methods are standardized.
viii) Machine set ups remain unchanged for a considerable long
period.
Limitations of mass or flow production:
i) Breakdown of one machine will stop an entire production line.
ii) Line layout needs major change with the changes in the product
design.
iii) High investment in production facilities.
iv) The cycle time is determined by the slowest operation.
Difference between Job Enrichment and Job Enlargement:
The followings are the difference between Job Enrichment and Job
Enlargement:
Job Enrichment Job Enlargement
job enrichment is the quality job enlargement is the quantity
Job enrichment means
improvement, or an increase with
the help of upgrading and
development
whereas job enlargement means to
add more duties, and an increased
workload.
By job enrichment, an employee
finds satisfaction in respect to their
position and personal growth
potential
whereas job enlargement refers to
having additional duties and
responsibilities in a current job
description.

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Job enrichment involves organizing
and planning in order to gain more
control over their duties and work
as a manager.
by adding more variety and
enlarging the responsibilities will
provide the chance of
enhancement and more
productivity.
job enrichment involves a vertical
loading or expansion of job, in
other words it involves addition of
tasks of different nature.
Job enlargement involves a
horizontal loading or expansion of
job, in other words it involves
addition of tasks of the same
nature.
Example:
The teller in a bank also has the
authority to help a client fill out a
loan application, and to determine
whether or not to approve the loan.
Another example is a customer
service worker used the
experience that he have to solve
the problem by himself without
refer his manager.
Example:
The teller in a bank also is to be a
store keeper.
Another example is waiter job in
small hotel not only includes serve
customer but also replacing burned
bulbs and cleaning.
Project life cycle, stages of project life cycle:
Project life cycle:
Project life cycle is a workflow of activities defined in the systematic ways
to gain maximum benefits from business project.
The Project Life Cycle refers to the four-steps process that is followed by
nearly all project managers when moving through stages of project
completion. The Project Life Cycle provides a framework for managing

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any type of project within a business. Leaders in project management
have conducted research to determine the best process by which to run
projects.
Stages of project life cycle:
i) Initiation (starting the project)
ii) Planning (organizing the project)
iii) Execution (Carrying out the work)
iv) Closure (Closing the project)
Explanation:
i) Initiation:
This is the first stage of project life cycle. In this stage project objectives
are identified and requirements are clarified. Apart from this further
investigation is done to find the feasibility. After doing all the studies final
recommendations are been addressed whether we can do this project or
not? Or whether this project is profitable or not? Once project is been
approved, hiring of employees and managers are conducted. Team are
built to deliver the business project. Finally, detailed planning is been
performed on the project by key members of the projects.
ii) Planning:
In project planning phase, scope of the project is defined more accurately.
Once the project team is been finalized and work is been identified,
schedules of deliverables and estimated cost are been figured out.
Detailed planning is established for its duration; timelines, resources and
expenditures, as well as policies and management procedures.
iii) Execution:
This is the third stage of project life cycle. In this phase product or service
is actually carried out according to plan and in accordance with the
applicant’s requirements. Project managers keep close watch on
implementation activities, since this is one of the important stages of life

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cycle. During this stage, team carry-on with task assigned to them and
daily status report is been presented to management to track the activities
and schedule of the activities. Apart from this stakeholder are also been
communicated on the activities on regular basis.
iv) Closure:
This is the final stage of project life cycle. In this stage product or service
is been delivered to customer or a client for evaluation. Project
documentations like user manuals and other documents are been handed
over to the client. All key members and stakeholders are been
communicated regarding closure of the project. Lastly, documentation of
lessons learn is been prepared by team members for the purpose of
examinations and self-learning for the future projects.
Productivity management and improvement tools, improvement of
productivity, measurement of productivity:
Productivity management:
Productivity is defined as the ratio of output to the input of an operational
system. The higher a company’s productivity is, the higher its profits.

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i.e., Productivity =
Output
Input
Productivity management defines that how a company productivity can be
improved. It is a measure of how efficiently and effectively a business
uses inputs such as labour and capital to produce outputs such as goods
and services.
An increase in productivity means that more goods and services are
produced with the same amount of labour and capital. Increasing
productivity is about finding new and innovative ways to do things better –
ways that will enable you to work less and yet achieve more.
Improving productivity is about finding new, faster, more accurate and/or
smarter ways to work less, yet achieve more. It goes beyond saving time
and money through efficient business strategies and processes, but is
also about seeking new or better ways to increase your profits and
revenue streams.
Ultimately, improving productivity is about being more competitive, which
is critical for sustained business growth in today’s business landscape.
Improvement tools:
The followings tools/techniques used for the improvement of productivity:
i) CAD
ii) CAM
iii) CIM
iv) ROBOTICS
v) JIT
vi) GROUP TECHNOLOGY

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i) CAD: A software system that uses computer graphics to assist in
the:
• Creation
• Modification
• analysis of a design
ii) CAM: Use of computer system to plan, manage and control the
operation of a manufacturing plant through either direct or indirect
computer interface.
iii) CIM: CIM (computer integrated manufacturing) is the architecture
for integrating the engineering, marketing, and manufacturing
functions through information technologies.
iv) A philosophy of manufacturing based on planned elimination of all
waste and continuous improvement of productivity.
v) Robotics: A robot is a reprogrammable, multifunctional
manipulator designed to move material, parts, tools, or
specialized devices through variable programmed motions for the
performance of a variety of tasks.
vi) JIT: A philosophy of manufacturing based on planned elimination
of all waste and continuous improvement of productivity.
vii) Group Technology: Group technology is a manufacturing
philosophy in which similar parts are identified and grouped
together to take advantage of their similarities in manufacturing
and design.

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Improvement of productivity:
Productivity improvement means increasing or arising productivity with
the help of using same amount materials, machine time, land, labour or
technology.
The following factors can lead to the improvement in productivity:
i) Training programs for labour
ii) Incentives in contract for good performance
iii) Enough tools in working place and proper planning
iv) Optimizing site facilities
v) Availability of resources
vi) Competition between crews, areas or shifts
vii) Good supervision and optimum manpower
viii) Short interval scheduling
ix) Innovative materials and equipment
x) Time lapse film analysis for critical activities
xi) Cost reporting and work sampling of critical activities
xii) Time and motion studies to improve efficiency, reduce fatigue and
work smarter
xiii) Safety programs
xiv) Use of precast and pre-stressing concrete elements
xv) Critical path method of planning, scheduling and control
xvi) Value engineering
xvii) Worker motivation programs
xviii) Constructability review of design
xix) Standardization
xx) Preplanning activities
xxi) Effective utilization of sub-contractors

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Productivity measurement:
There are three major types of productivity measures which is given
below:
1) Partial or Single productivity:
Partial or Single productivity is the ratio of output to one class of
input among many factors of production. For example, labour
productivity measures the productivity of labour. Similarly, material,
machine, land and capital productivities can be defined. Thus,
Labour productivity =
Output
Labout Input
Capital productivity =
Output
Capital emplyed
Material productivity =
Output
Materials Input
and so on.
Example: A company produces of $80,000 worth of goods in 1500
hours. To calculate labor productivity.
Labour productivity =
Output
Labout input
=
$80,000
1500
= $53 per hour of work
2) Total or Multi Factor productivity:
Total or Multi-factor productivity relates a change in output to several
types of inputs. Here output means output minus material, capital,
energy and other input expenses. Thus,
Total or Multi Factor Productivity =
Net Output
Labour Inputs + Capital inputs
Example: A company produces 35 chairs/day. Labor cost 480,
material cost 200 and overhead cost is 250. It sells chairs to a
retailer for 70/unit. The multifactor productivity then be calculated as:
Multi Factor Productivity =
value of output
labout + material + overhead cost
=
70 ×35
480+200+250
= 2.63

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3) Total Productivity:
Total productivity is the ratio of total output to the sum of all input
factors. Thus, it represents the joint impact of all the input factors in
producing the output.
Total Productivity =
Total Tangible Output
Total Tangible Input
Total tangible output = value of finished goods + value of partially
finished units + dividends from securities + interest + other income.
Total tangible input = value of human, material, capital, energy and
other inputs used.
The outputs and inputs of a company must be expressed in a common
unit preferably in monetary value, say rupee value. To compare
productivity, indices are to be adjusted to the base year and must be
stated in terms of base year rupee value. This is referred to as deflating
the input and output factors. Deflators are used to nullify the effect of
changing price from one year to another.
Deflator =
Current year price
Base year price
Project Selection:
Project selection is the process of evaluating individual projects or groups
of projects, and then choosing to implement some set of them so that the
objectives of the parent organization will be achieved
Managers often use decision-aiding models to extract the relevant issues
of a problem from the details in which the problem is embedded
Models represent the problem’s structure and can be useful in selecting
and evaluating projects
Criteria for project Selection:
The followings are the criteria for project selection:
i) Customer impact: Will the successful outcome of the project have
a material impact on customers’ (internal or external) perceptions
of quality?

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ii) Data availability: Is relevant data to project available. If not, is it
attainable? It is important that key required data can at least be
collected without having to spend an unreasonable amount of
time, resources and effort.
iii) Solution clarity: Is the solution already known? If so, just do it and
if not then find the solution through research.
iv) Ease to use: The project model should be easy to use, easy
execution and easily understood as it doesn’t need expert to run.
v) Cost: Data gathering and modelling costs should be low relative to
the cost of the project.
vi) Flexibility: The model should have the ability to be easily modified
for future advancement.
Management is Science or Art with examples:
Several economists discuss their views about that rather management is
science or it is an art. Some of them was agree with this of as a science
while some consider it as an art, there were also some under by this for
both science and art.
Let us discuss the fact that management is an art or science.
Management can be considered as both science as well as an art.
Management is science because it is an organized knowledge
underlying practice. It defines different principles and explained
several theories.
It is science because it can be thought and learnt.
It is considered as a science because it has an organized body of
knowledge which contains certain universal truth.
Management is also an art because managing as practice is an art.
It is art because personal skill is applied during working as s
manager.

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All theories which are learnt previously are implemented in managing,
new creativity take place. So, we can say that management has elements
of both science and art.
It may not be proper to term it as pure science or pure art. In fact, it is
science as well as an art because science and art are both
complementary to each other.
As Cossa has said, “Science requires art, and art requires science,
each being complementary to each other”,
It may be concluded that there is no hard and fast line between science
and art of management.
The present ratio is 10% science while 90% art. In short management is
both science and art.
It is science because it has an organized body of knowledge which
contains certain universal truth.
It is called an art because managing requires certain skills which are
personal possessions of manager.
Inventory management:
Inventory management is the supervision of non-capitalized assets
(inventory) and stock items.
Inventory management is the overseeing and controlling of the ordering,
storage and use of components that a company will use in the production
of the items it will sell as well as the overseeing and controlling of
quantities of finished products for sale. Inventory is the life blood of any
business. Most firms store thousands of different items.
Inventory is material that the firm obtains in advance of need, holds until it
is needed, and then used, consumes, incorporates into a product, sells,
or otherwise disposes it off. A business inventory is temporary in nature.

29. 29
Inventories are stock of any kind like fuel and lubricants, spare parts and
semi-processed materials to be stored for future use mainly in the
process of production or it can be known as the ideal resource of any kind
having some economic values.
Inventory is one of the major assets of a business and it represents an
investment that is tied up until the item is sold or used in the production. It
also costs money to store, track and insure inventory. Inventories that are
mismanaged can create significant financial problems for a business.
Recruitment:
Recruitment is one of the phases of the staffing function.
It may be defined as the process by which manpower is discovered and
then encouraged to apply for employment.
It includes the overall process of attracting, selecting and appointing
suitable candidates to one or more jobs within an organization either
permanent or temporary.
Recruitment process, job evaluation:
Recruitment process:
When any vacancy arises in an organization due to death, promotion,
illness, resignation or expansion, the concern department inform the
nearest employment exchange and if possible should give the public
through the popular newspapers and also on other sources.
While advertising any advertisement for a vacancy in newspapers or
other means, the department should mentioned the following facts:
i. Number of vacant posts.
ii. Grade of vacancies.
iii. General nature of the job.

30. 30
iv. Whether the previous experience is necessary.
v. Last date of submitting applications.
vi. Basic salary and other allowances.
However, in any organization the recruitment process follows the
following steps:
1. Application Form
2. Test
3. Interview
1. Application Form:
When an organization advertise for vacancy, it also publishes the
application form for the current vacancy, which must be fill by the
candidates.
The application form carries the following information about the
candidate.
➢ Name + Address + Contact number
➢ Qualifications
➢ Skills
➢ Experience
➢ Job interest etc.
2. Test:
Nowadays each organization is conducting test from the candidates who
apply for the vacancy. There are two types of test.
i. Written test
ii. Personality test
In written test a question paper may be of objective or subjective type is
given to the candidate which will be filled by him/her.
While personality test may be of rating method, questionnaire, situational
aptitude test.
3. Interview:

31. 31
It is the method of judgement through which interviewer judge and
analyze the candidate ability, interest, experience and personality.
It may be of different types such as
➢ structured or unstructured interview
➢ one to one interview
➢ panel interview
➢ stress interview
Training:
The process of teaching new employees the basic skills they need to
perform their jobs.
Training Process:
The followings are the steps for the training process:
1. Needs Analysis for training
2. Setting Objectives of training
3. Designing training program
4. Implementation of training
5. Evaluation of result
Explanation:
1. Needs Analysis for training:
Needs analysis diagnosis present problems and future challenges to
be met through training and development and through a gap
between the employee’s actual performance and the standard
performance.
2. Setting objectives of training:
Once training needs are analyzed, training objectives must be
established and determine what to train. Objectives must be
tangible, verifiable, and measurable. This is easy where skills’
training is involved.
3. Designing training program:

32. 32
• This includes items like, references, info packs, case studies,
movies, games, and other visual aids.
• The information must be kept organized
• feedback from previous sessions is included
• Keep the trainees engaged with activities such as trivia
questions, interactive exercises, and group discussions
• It is a proven fact that engagement raises knowledge retention
4. Implementation of training:
Once the designing of the training program is completed, the next
step is to put it into the action.
Time and place for the training is set along with the trainer who will
be conducting the training session. Also, the trainees are monitored
continuously throughout the training program to see if it’s effective
and is able to retain the employee’s interest.
5. Evaluation of result:
After the training is done, the employees are asked to give their
feedback on the training session and whether they felt useful or not.
Through feedback, an organization can determine the weak spots if
any, and can rectify it in the next session. The evaluation of the
training program is a must because companies invest huge amounts
in these sessions and must know it’s effectiveness in terms of
money.
Thus, every firm follows the series of steps to design an effective
training program that serves the purpose for which it was intended.
Job Evaluation:
According to Flippo Job evaluation is a systematic and orderly process of
determining the worth of a job in relation to other jobs and what the fair
basic salary for such a job should be.

33. 33
Job Evaluation Process:
The process of job evaluation involves the following steps:
➢ Gaining acceptance:
➢ Creating job evaluation committee.
➢ Finding the jobs to be evaluated.
➢ Analyzing and preparing job description.
➢ Selecting the method of evaluation.
➢ Classifying jobs.
JOB EVALUATION METHODS:
There are two methods for job evaluation which is given below:
1. Non- Analytical:
i) Job Ranking
ii) Job grading or classification
2. Analytical:
i) Factor Comparison
i) Point method

34. 34
Explanation:
1. Non-analytical Job Evaluation Methods
i) Ranking Method:
➢ As per this method, jobs are arranged from highest to lowest, in
order of their values or merit to the organization.
➢ Jobs can also be arranged according to the relative difficulty in
performing them.
➢ The job at the top has the highest value and job at the lowest has
the lowest value.
➢ Jobs are arranged in each department and then department ranking
are combined to develop an organization ranking.
e.g.- Ranking of jobs in any department can be done as follows:
ii) Job Grading or classification Method:
Under this method the job grades or classes are predetermined and then
each job is assigned to these and is evaluated accordingly.

35. 35
For Example, Class, I, comprise of the managerial level people under
which sub-classification is done on the basis of the job roles such as
office manager, department managers, departmental supervisor, etc.
2. Analytical Job Evaluation Methods:
i) Factor-Comparison Method: Under this method, the job is
evaluated, and the ranks are given on the basis of a series of
factors Viz. Mental effort, physical effort, skills required
supervisory responsibilities, working conditions, and other
relevant factors.
ii) Point-Ranking Method: Under this method, each job’s key factor is
identified and then the sub factors are determined. These sub-
factors are then assigned the points by its importance.
For example, the key factor to perform a job is skills, and then it
can be further classified into sub-factors such as training required,
communication skills, social skills, persuasion skills, etc.
The point ranking method is less subjective and is an error free as
the rater sees the job from all the perspectives. But however, it is
a complex method and is time-consuming since the points and
wage scale has to be decided for each factor and the sub factors.

36. 36
JIT Philosophy, Inventory in JIT is zero:
JIT Philosophy: JIT is the Japanese philosophy which means “Less is
the best” which means getting the right quantity of goods at the right
place and at the right time.
JIT exceeds the concept of inventory reduction; it is an all-encompassing
philosophy geared to eliminate waste, anything that does not add value
Just-in-time (JIT) is an inventory strategy companies employ to increase
efficiency and decrease waste by receiving goods only as they are
needed in the production process, thereby reducing inventory costs. This
method requires producers to forecast demand accurately.
Function of JIT:
• Involves keeping stock levels to a minimum.
• Stock arrives just in time to be used in production.
• Works best where there is close relationship between manufacturer
and supplier.
• Goods not produced unless firm has an order from a customer.
• Aims to get highest volume of output at lowest unit cost.
Zero inventory in JIT:
It is often said that the inventory in JIT is zero because zero inventory is
"A system in which a company keeps no or very little inventory in storage,
simply ordering exactly what it needs to sell and receiving it in a timely
manner. Zero inventory is the goal of just-in-time inventory management
and the two terms are sometimes used to mean the same thing.
The concept of zero inventory originally came from Toyota, with its
famous Kanban management. This technique helped Toyota link every
single point on the supply chain together as a whole, and reduce the cost
significantly. Zero inventory has certainly brought a huge success to
Toyota.
Advantages and disadvantages of JIT:
Advantages of JIT:
• Reduction in inventories.
• Improved quality.
• Reduced space requirements.
• Shorter lead times.
• Lower production costs.

37. 37
• Increased productivity.
• Increased machine utilization.
• Greater flexibility
Disadvantages of JIT:
• Danger of disrupted production due to non-arrival of supplies.
• Danger of lost sales.
• High dependence on suppliers.
• Less time for quality control on arrival of materials.
• Increased ordering and admin costs.
• May lose bulk-buying discounts.
Explain the followings:
Recruitment:
Recruitment is one of the phases of the staffing function.
It may be defined as the process by which manpower is discovered and
then encouraged to apply for employment.
It includes the overall process of attracting, selecting and appointing
suitable candidates to one or more jobs within an organization either
permanent or temporary.
Recruitment can be done by:
• Advertised vacancy in the newspapers along with application form.
• Arrange test who had applied for the vacant post
• Arrange interview for those candidates who have passed the test.
• Select suitable candidates who have good score in all the stages.
Performance Appraisal:
Performance appraisal is evaluating an employees current and past
performance relative to his performance standards.
It is an annual review of an employee’s overall contributions to the
company by his/her manager. Performance appraisals, also called annual
reviews, evaluate an employee’s skills, achievements and growth, or lack
thereof. Companies use performance appraisals to give employees big-
picture feedback on their work and to justify pay increases and bonuses,
as well as termination decisions.

38. 38
Training:
Training is the process of teaching new employees the basic skills they
need to perform their jobs.
There are many types of training given below:
i) Short term training: This type of training is used to trained the
employees for the short time to get some basic skills to perform work
of unserious nature.
ii) Long Training: training for one or two years to trained employees for
special skills to performing some technical work.
iii)Pre-employment or OFF the job training: It is given to new
employees before their placement.
iv)Post-employment OR ON the training: Training for employments to
increase their potential ability.
v) Departmental training: training within organization under the
guidance of concerned departments experienced officer.
vi)Central Training: Training given for some special occasions inside
the organization.
Motivation:
Motivation is the word derived from the word ’motive’ which means needs,
desires, wants or drives within the individuals.
It is the process of stimulating employees to actions to accomplish the
goals for the productivity of a company.
In the work goal context, the psychological factors stimulating the
people’s behaviour can be:
• desire for money
• success
• recognition
• job-satisfaction
• team work, etc.
One of the most important functions of management is to create
willingness amongst the employees to perform in the best of their abilities.
Therefore, the role of a leader is to arouse interest in performance of
employees in their jobs.
Incentives:
Anything that can attract an employee’s attention and motivate them to
work can be called as incentive. An incentive aims at improving the
overall performance of an organization.

39. 39
Types of incentives:
1. Financial incentives: Some extra cash is offered for extra efficiency.
For example, profit sharing plan and group incentive plans.
2. Non-financial incentives: When rewards or prizes are provided by
the organization to motivate the employees it is known as non-
financial incentives.
3. Monetary and non-monetary incentives: Many times, employees are
rewarded with monetary and non-monetary incentives that include
promotion, seniority, recognition for merits, or even designation as
permanent employee.
Safety Stock:
Safety stock is an additional quantity of an item held in inventory in order
to reduce the risk that the item will be out of stock. Safety stock acts as a
buffer in case the sales of an item are greater than planned or the
supplier is unable to deliver additional units at the expected time.
Safety stock can be calculated by using the given formula:
Safety Stock = (Maximum Daily Usage − Average Daily Usage) × Lead Time
It is important to calculate it accurately because while too little stock
results in shortages.
Types of production:
There are three types of production which are given below:
1. Job Production
2. Batch Production
3. Mass or Flow Production
Explanation:
1. Job Production: Job production is where a single item or product is
made at a time. It is associated with high quality goods, customized
orders and unique items for a specific customer.
For example: A small cake shop makes its regular cakes in batches
of up to 120. Wedding cakes are high value items that are created
one at a time.

40. 40
2. Batch Production: Batch production is a method of producing a
number of items together in a series of steps. It occurs when many
similar items are produced together.
For example: A bakery produces a batch of 240 number of bread.
The process involves 4 steps and the entire batch is moved from
step to step together.
3. Mass or Flow Production: Mass or flow production is the production
of goods at scale typically using an assembly line. It is a continuous
process whereby production steps are run concurrently. Under this
method, goods flow in production or assembly line which pass from
one stage to the next without a break where the number of stages
varies according to the product and there is a worker/machine at
each stage who does one operation.
Capacity Utilization:
Capacity utilization is an economics concept which refers to the extent to
which an enterprise or a nation actually uses its installed productive
capacity. Thus, it refers to the relationship between actual output
produced and potential output that could be produced with installed
equipment, if capacity was fully used
It can be expressed as:
Capacity utilization =
Actual Output
Potential output
For example: Malakand III Hydropower plant has installed capacity of 81
MW energy but its actual output is in between 70 – 75 MW energy
generation capacity.
Productivity Improvement:
Productivity improvement means increasing or arising productivity with
the help of using same amount materials, machine time, land, labour or
technology.
The following factors can lead to the improvement in productivity:
i) Training programs for labour
ii) Incentives in contract for good performance

41. 41
iii) Enough tools in working place and proper planning
iv) Availability of resources
v) Good supervision and optimum manpower
vi) Innovative materials and equipment
vii) Cost reporting and work sampling of critical activities
viii) Time and motion studies to improve efficiency, reduce fatigue and
work smarter
ix) Safety programs
x) Worker motivation programs
xi) Standardization
xii) Preplanning activities
Job Evaluation:
According to Flippo Job evaluation is a systematic and orderly process of
determining the worth of a job in relation to other jobs and what the fair
basic salary for such a job should be.
The purpose of Job Evaluation is to establish a logical hierarchy of jobs
and to determine which jobs should get more pay than others. Several
methods such as job ranking, job grading, and factor comparison are
employed in job evaluation. Job evaluation forms the basis for wage and
salary negotiations.
Benefits of Job Evaluation:
➢ Provides a hierarchy of jobs that can be used in organizational
structure and career planning.
➢ Improves manpower planning and organization of work.
➢ Improves overall utilization of human resources.
➢ Provides the basis of a fair and equitable remuneration structure.

42. 42
Leader Vs Manager:
Leader Manager
A leader is person who leads or
commands a group or country.
While a manager is person who is
responsible for controlling or
administering an organization or
group of staff.
The leader is innovative The manger is administrative
Leader show how to do Manager say what to do
Leader focuses on future Manager focuses on the present
Leader has followers Manger has subordinates
Work on the system Work in the system
Leader has vision Manager has objectives
Focuses on people Focuses on work
He does the right things He does things right
Work with heart Work with head
He develops people He uses people
The leader has a long term view The manager has short term view

43. 43
Terms used in Project Management:
Early Start:
It is the earliest time by which a scheduled project activity can logically
start. OR
In the critical path method, the earliest possible point in time on which the
uncompleted portions of the project can start, based on the network logic
and any schedule constraints. Early start dates can change as the project
progresses and changes are made to the project plan.
Early Finish:
The earliest time by which a scheduled project activity can logically finish.
OR
In the critical path method, the earliest possible point in time on which the
uncompleted portions of the project can be finished based upon the
network logic and any schedule constraints. Early finish dates can change
as the project progresses and changes are made to the Project Plan.
Late start date:
The latest possible date a scheduled activity can be started without
delaying the rest of the project.
Late finish date:
The latest possible date a scheduled activity can be completed without
delaying the rest of the project.
Slack OR Float:
The length of time an activity's early start can be delayed without affecting
project duration. OR
The amount of time an activity may be delayed from its early start without
delaying the project finish date. Float is a mathematical calculation and
can change as the project progresses and changes are made to the
Project Plan.

44. 44
Critical path:
The series of activities that determines the duration of the project. The
critical path is usually defined as those activities with no slack. It is the
longest path through the project.
Critical path method:
The Critical path method is used to estimate the shortest length of time
needed to complete a project and to determine the amount of float for
activities that are not part of the critical path.
Event:
A point in time when an activity is started or completed. It does not
consume time. OR
Event is the point during the project duration that marks the completion of
an activity.
Dummy Activity:
An activity of zero duration used to show a logical relationship in the
arrow diagramming method. Dummy activities are used when logical
relationships cannot be completely or correctly described with regular
activity arrows. Dummies are shown graphically as a dashed line headed
by an arrow.
Deterministic Models:
Deterministic models are those in which the output of the model is fully
determined by the parameter values and the initial conditions.
In this model the outcomes are precisely determined through known
relationships among states and events, without any room for random
variation. In such models, a given input will always produce the same
output.
Probabilistic or Stochastic Models:
Probabilistic models are those in which the model possess some inherent
randomness. Simulation in which ranges of values for each variable (in
the form of probability distribution) are used. The same set of parameter
values and initial conditions will lead to an ensemble of different outputs.

45. 45
PERT (Program Evaluation and Review Technique):
A statistical tool used to visualize a project’s schedule, sequence of tasks,
and even the critical path of tasks that must be completed on time in
order for the project to meet its deadline. PERT applies the critical path
method to a weighted average duration estimate.
CPM (Critical Path Method):
A network analysis technique used to predict project duration by
analyzing which sequence of activities (which path) has the least amount
of scheduling flexibility (the least amount of float).
Early dates are calculated by means of a forward pass using a specified
start date. Late dates are calculated by means of a backward pass
starting from a
specified completion date (usually the forward pass’ calculated project
early finish date).
Project Crashing:
The technique of speeding up the project schedule by using more
resources (i.e. people, materials, or equipment) than what was originally
planned.
It is the action taking to decrease the total project duration after analyzing
a number of alternatives to determine how to get the maximum duration
compression for the cost. Crashing increases project costs, so it is used
first on activities that can be sped up at the least additional cost.
Activity on Arc:
In the network diagram shown, each arc represents an activity and is
labelled with the activity number. This network is an activity on arc (AOA)
network. The nodes of the network represent the start (and end) of
activities and are regarded as events.

46. 46
Economic Order quantity, Production order quantity, quantity
discount model:
Economic Order Quantity:
Economic order quantity is one of the techniques of inventory control
which minimizes total holding and ordering costs for the year.
The economic order quantity is the technique which solves the problem of
the materials manager.
EOQ is essentially an accounting formula that determines at which the
combination of order, costs and inventory carrying cost are the least.
The result is the most cost-effective quality to order. In purchasing this is
known as order quantity, in manufacturing it is known as the production
lot size.
Derivation for the expression of EOQ model:
Variables:
P = purchase unit price or unit production cost
Q = order quantity
D = annual demand
K = cost per order
h = holding or carrying cost
The single-item EOQ formula finds the minimum point of the following
cost function:
Total Cost = purchase cost or production cost + ordering cost + holding
cost
Where:
• Purchase cost: This is the variable cost of goods: purchase unit
price × annual demand quantity. This is P × D
• Ordering cost: This is the cost of placing orders: each order has a
fixed cost K, and we need to order D/Q times per year. This is K ×
D/Q
• Holding cost: the average quantity in stock (between fully
replenished and empty) is Q/2, so this cost is h × Q/2

47. 47
∴ TC = PD +
DK
Q
+
hQ
2
Taking the derivative of both sides with respect to Q (assuming all other
variables are constant):
d
dQ
(TC) =
d
dQ
(PD +
DK
Q
+
hQ
2
)
d
dQ
(TC) =
d
dQ
(𝑃𝐷) + 𝐷𝐾
d
dQ
(
1
Q
) +
h
2
d
dQ
(Q)
0 = 0 + DK (–
1
Q2) +
h
2
0 = -
DK
Q2 +
h
2
Or
DK
Q2 =
h
2
Or
DK = Q2
(
h
2
) or
Q2
= DK (
2
h
)
Q2
=
2DK
h
Taking square root of both sides
√Q2 = √
2DK
h
Therefore,
Economic Order Quantity = Q = √
2DK
h
this is the expression for EOQ model.
Example:
A company makes bicycles. It produces 450 bicycles a month. It buys the
tires for bicycles from a supplier at a cost of $20 per tire. The company’s
inventory carrying cost is estimated to be 15% of cost and the ordering is
$50 per order. Calculate the EOQ
In this problem:
D = annual demand = (2 tires per bicycle) x (450 bicycles per month) x (12 months in a year)
= 10,800 tires

48. 48
K = ordering cost = $50 per order
h = carrying cost = (15%) x ($20 per unit) = $ 3.00 per unit per year
EOQ = √
2DK
h
= √
2 × 10800 × $50
$3
= √400,000 = 600 tires
The company should order about 600 tires each time it places an order.
Reorder Point:
Level of inventory at which a new order is placed.
The reorder point (ROP) is the level of inventory which triggers an action
to replenish that particular inventory stock. It is a minimum amount of an
item which a firm holds in stock, such that, when stock falls to this
amount, the item must be reordered.
A reorder point is the inventory unit quantity on hand that triggers the
purchase of a predetermined amount of replenishment inventory. If the
purchasing process and supplier fulfillment work as planned, the reorder
point should result in the replenishment inventory arriving just as the last
of the on-hand inventory is used up. The result is no interruption in
production and fulfillment activities, while minimizing the total amount of
inventory on hand.
Reorder point is a technique to determine when to order; it does not
address how much to order when an order is made.
Reorder point can be calculated by the given formula:
ROP = Lead time + Demand + Safety Stock
Where,
Safety stock = (maximum daily usage - average daily usage) x lead time

49. 49
Lead Time:
Lead time is defined as the number of days between issuing a purchase
order and receiving the product is known as lead time.
New stock doesn’t arrive immediately. Even if your products are in stock,
it’ll take your supplier time to pack your order and even more time to ship
it over to you. This waiting time is known as lead time.
The lead time is simply the number of units of inventory the business
must hold to cover customer demand for the product during the lead time
between the business ordering the inventory from the supplier and it
being received into the warehouse.
Example 2:
ABC Ltd. is engaged in production of tires. It purchases rims from DEL
Ltd. an external supplier. DEL Ltd. takes 10 days in manufacturing and
delivering an order. ABC's requires 10,000 units of rims. Its ordering cost
is $1,000 per order and its carrying costs are $3 per unit per year. The
maximum usage per day could be 50 per day. Calculate economic order
quantity, reorder level and safety stock.
Solution
EOQ = √
2𝐷𝐾
ℎ
= √
2 ×10,000 × 10
3
= 258.2
Maximum daily usage is 50 units and average daily usage is 27.4 (10,000
annual demand ÷ 365 days).
Safety Stock = (50 - 27.4) × 10 = 226 units.
Reorder Level = Safety Stock + Average Daily Usage × Lead Time
Reorder Level = 226 units + 27.4 units × 10 = 500 units.

50. 50
POQ (Production order quantity model):
The economic production quantity model determines the quantity a
company should order to minimize the total inventory costs by balancing
the inventory holding cost and average fixed ordering cost.
The EPQ model was developed by E.W. Taft in 1918. This method is an
extension of the EOQ model. The difference between these two methods
is that the EPQ model assumes the company will produce its own
quantity or the parts are going to be shipped to the company while they
are being produced, therefore the orders are available or received in an
incremental manner while the products are being produced. While the
EOQ model assumes the order, quantity arrives complete and
immediately after ordering, meaning that the parts are produced by
another company and are ready to be shipped when the order is placed.
Formula:
Q = √
2DK
h (1−x)
, where D= demand, K= ordering cost, h = holding cost, x=
𝐷
𝑃
and P = production cost.
Quantity discount Model:
Quantity discount Model is price reductions designed to induce large
orders.
It is a price discount on an item if predetermined numbers of units are
ordered.
To increase sales, many companies offer quantity discounts to their
customers. A quantity discount is simply a decreased unit cost for an item
when it is purchased in larger quantities. It is not uncommon to have a
discount schedule with several discounts for large orders.
A quantity discount is an incentive offered to a buyer that results in a
decreased cost per unit of goods or materials when purchased in greater
numbers. A quantity discount is often offered by sellers to entice buyers
to purchase in larger quantities. The seller is able to move more goods or
materials, and the buyer receives a more favorable price for the goods.

51. 51
Safety Stock level:
Safety stock level is an additional quantity of an item held in inventory in
order to reduce the risk that the item will be out of stock. Safety stock acts
as a buffer in case the sales of an item are greater than planned or the
supplier is unable to deliver additional units at the expected time.
Safety stock can be calculated by using the given formula:
Safety Stock = (Maximum Daily Usage − Average Daily Usage) × Lead
Time
It is important to calculate it accurately because while too little stock
results in shortages.