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Business Studies · 2026 · 6 marks
CBSE 2026 · Region 3 · Set 1 · Q32
‘Kia Tyres’ is a company manufacturing tyres for cars, two-wheelers, trucks and buses. It has a well-defined organisational structure designed by the…
‘Kia Tyres’ is a company manufacturing tyres for cars, two-wheelers,
trucks and buses. It has a well-defined organisational structure designed
by the management to facilitate smooth functioning of the organisation.
It specifies the relationships among various job positions and the nature
of their inter-relationship. It is easier to fix responsibility, since mutual
relationships are clearly defined. There is no ambiguity in the role that
each member has to play, as duties are specified. This also helps in
avoiding duplication of work. As a result, ‘Kia Tyres’ is able to effectively
accomplish its goals.
However, during lunch breaks and after office hours, employees from
different departments of ‘Kia Tyres’ meet regularly. This helps to fulfil
the social needs of employees and allows them to interact with
like-minded people. This enhances their job satisfaction by giving them a
sense of belongingness in the organisation.
(i)
Identify the types of organisation discussed in the above and give
their meaning.
(ii)
State two advantages of each of the types of organisation identified
in (i) above, not discussed in the given case.
Marking-scheme solution
(i)
Types of organisation:
1. Formal Organisation
Formal organisation refers to the organisation structure which is designed
by the management to accomplish a particular task by clearly defining the
boundaries of authority and responsibility.
2. Informal Organisation
Informal Organisation means a network of social relationships among
(ii)
employees arising due to interaction among people at work.
Advantages of Formal Organisation
1. Unity of command is maintained through an established chain of
command.
2. It provides stability to the organisation. This is because behaviour of
employees can be fairly predicted since there are specific rules to guide
them
Advantages of Informal Organisation
1. Prescribed lines of communication are not followed. Thus, the informal
organisation leads to faster spread of information as well as quick
feedback.
2. It contributes towards fulfilment of organisational objectives by
compensating for inadequacies in the formal organisation.
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CBSE Class 12 Business Studies past-paper question from the 2026 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.