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Functions and Principles of Management for CSEET

Updated 11 October 2026 · Fact-checked

The functions of management are planning, organising, staffing, directing and controlling. Fayol's 14 principles are general guidelines for running any organisation. To solve MCQs, spot the key word in the situation, such as setting goals, hiring, motivating or comparing results, and match it to the function or principle it describes.

Understand Functions and Principles of Management

Management is the process of getting work done through other people to reach set goals. A manager does not do every job personally. A manager plans the work, arranges people and resources, guides them and checks results.

This process is split into five functions: planning, organising, staffing, directing and controlling. They work as a cycle. Plans set goals, the structure and people are arranged to meet them, leaders guide the people, and control checks whether the goals were met. If results fall short, new plans are made.

Henri Fayol, a French mining engineer and manager, set out 14 principles of management. They are general guidelines, not fixed laws. A manager applies them according to the situation. Fayol also described the work of managers as planning, organising, commanding, coordinating and controlling. Later writers reworked this list into the five functions used today.

In CSEET Paper 4, questions on this topic are one-mark MCQs. They are mostly situation-based. You are given a small case and must name the function or principle. So you need to know the definitions well and know the key word that points to each one.

A common search is the difference between administration and management. Administration is often described as the top-level function of deciding broad policy and objectives. Management is described as the function of carrying out that policy through execution. Some writers treat the two as the same, so read the question wording and answer the way the study material frames it.

Key formulas to remember

Five functions of management: Planning → Organising → Staffing → Directing → Controlling; Learn the order. Planning comes first because every other function depends on the goals it sets. Controlling feeds back into planning.
Planning: Planning = deciding in advance what to do, how to do it and who will do it; Key words: goals, objectives, forecast, policy, budget, strategy, 'look ahead'.
Organising: Organising = assigning duties + grouping jobs + setting authority relationships + allocating resources; Key words: structure, departments, delegation, reporting lines, chain of command.
Staffing: Staffing = recruitment + selection + training + appraisal + remuneration of people; Key words: hiring, placement, training, promotion, performance appraisal.
Directing: Directing = supervision + motivation + leadership + communication; Key words: guide, instruct, inspire, lead, 'getting people to work'.
Controlling: Controlling = set standards → measure actual performance → compare → take corrective action; Key words: standards, deviation, corrective action, comparing actual with planned.
Fayol's 14 principles: 1 Division of work; 2 Authority and responsibility; 3 Discipline; 4 Unity of command; 5 Unity of direction; 6 Subordination of individual interest to general interest; 7 Remuneration of personnel; 8 Centralisation and decentralisation; 9 Scalar chain; 10 Order; 11 Equity; 12 Stability of tenure of personnel; 13 Initiative; 14 Esprit de corps; Memory aid: count them in this order. Unity of command means one boss for one employee. Unity of direction means one plan for one group of activities with the same objective.

How to solve Functions and Principles of Management questions

Use this method for any question on the functions or principles of management.

1Read the situation or definition fully and underline the action being described.
2Ask what the manager is doing: setting goals, arranging structure, hiring, guiding people or checking results.
3Match the action to one of the five functions using the key words you have learned.
4If the question names a rule such as one boss, fair treatment or team spirit, switch to the Fayol list and find the principle with that meaning.
5Separate look-alike pairs: unity of command from unity of direction, authority from responsibility, centralisation from scalar chain.
6Remove options that describe a different function or principle, even if they sound reasonable.
7Choose the option that matches the core idea in the case, not a side detail.

Quickest way: Key-word matching

When to use it: Use this for one-mark MCQs in Paper 4 where you have about a minute per question.

Find the verb in the case: set, arrange, hire, motivate, compare.
Map it: set = planning, arrange = organising, hire = staffing, motivate or lead = directing, compare or correct = controlling.
For Fayol, map the problem: two bosses = unity of command, no clear plan = unity of direction, fair treatment = equity, long service = stability of tenure, group harmony = esprit de corps.
Mark the answer and move on. Return only if two options still seem right.

Common mistakes in Functions and Principles of Management

Treating unity of command and unity of direction as the same.
Both names start with 'unity' and both talk about order in the organisation.
Fix: Unity of command is about one employee receiving orders from one superior. Unity of direction is about one head and one plan for activities with the same objective.
Calling hiring and training 'directing'.
Students think any work with people is directing.
Fix: Recruitment, selection, training and appraisal belong to staffing. Directing is about supervising, motivating, leading and communicating.
Placing controlling before planning.
Students think control only happens at the end, so they ignore its link to planning.
Fix: Control compares actual results with the standards set in planning. Without plans there is nothing to measure against, so planning comes first.
Mixing up centralisation and scalar chain.
Both concern authority and levels in the organisation.
Fix: Centralisation is about how far decision power is held at the top. Scalar chain is the line of authority from top to bottom, used for communication.
Treating Fayol's principles as rigid laws.
The word 'principle' sounds like a fixed rule.
Fix: They are flexible guidelines. A manager adapts them to the situation, so avoid options that say they must always be followed exactly.
Confusing remuneration with equity.
Both can involve fair treatment of employees.
Fix: Remuneration is about fair pay for the work done. Equity is about kind and fair treatment of all employees by managers.

Worked examples

Example 1

Asha, the manager of a Pune garment company, fixes next year's sales target, decides which products to push and prepares a budget. Which function of management is she performing? (a) Planning (b) Staffing (c) Directing (d) Controlling

Show the solution

Find the action: fixing a target, choosing products and preparing a budget.
All of these are decided in advance, before the work starts.
Deciding in advance what to do and how to do it is planning.
Staffing is about hiring people, directing is about guiding them, and controlling is about comparing results. None of those is described.

Answer: (a) Planning

Example 2

Ravi works in a Chennai firm. He gets instructions from both the production head and the sales head about the same task, and the instructions conflict. Which principle of Fayol is violated? (a) Unity of direction (b) Unity of command (c) Scalar chain (d) Equity

Show the solution

Find the problem: one employee is receiving orders from two superiors.
The principle that says an employee should receive orders from one superior only is unity of command.
Unity of direction concerns one plan for a group with a common objective, which is not the issue here.
Scalar chain concerns the line of authority and equity concerns fair treatment, so neither fits.

Answer: (b) Unity of command

Exam tips

Memorise the five functions in order and one key word for each. Most MCQs reduce to this matching.
Learn all 14 principles with a one-line meaning each, and give extra time to the look-alike pairs.
In case-based questions, name the function by what the manager is doing, not by the manager's job title.
For written or short-answer style questions, define the term first, then give one line on its purpose, then an Indian example.
There is no negative marking in Paper 4, so answer every question even if you must guess after removing options.

Practice questions from Management Knowledge for Company Secretaries

Functions and Principles of Management in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Functions and Principles of Management: frequently asked questions

What are Fayol's 14 principles of management?

They are division of work, authority and responsibility, discipline, unity of command, unity of direction, subordination of individual interest to general interest, remuneration of personnel, centralisation and decentralisation, scalar chain, order, equity, stability of tenure of personnel, initiative and esprit de corps. They are general guidelines for managers.

What are the five functions of management?

They are planning, organising, staffing, directing and controlling. Planning sets goals, organising arranges resources, staffing places people, directing guides them and controlling checks results against plans.

What is the difference between administration and management?

Administration is generally described as the top-level function that decides broad policy and objectives. Management is described as the function that carries out that policy through execution. Since views differ, follow how your study material frames it.

How should I prepare this topic for the CSEET MCQs?

Learn each function with its key words and each Fayol principle with its meaning. Then practise case-based questions and name the function or principle from the manager's action. There is no negative marking in Paper 4, so attempt every question.