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Question

Mega Ltd. was manufacturing water-heaters. In the first year of its operations, the revenue earned by the  company was just sufficient to meet its costs. To increase the revenue, the company analysed the reasons of less revenue. After analysis, the company decided
(i)To reduce the labour cost by shifting the manufacturing unit to a backward area where labour was available at a very low rate.
(ii)To start manufacturing solar water-heaters and reduce the  production of electric water-heaters slowly.
This will not only help in converting the  risk, but also help in meeting other objectives too.


Solution

(a)The objective of the management that is being discussed here is 'organisational objective'.The total revenue earned by an organisation should be such that it is bale to sufficiently cover the various costs and expenses. That is, the revenue earned should be such that the organisation is able to continue operations in the long run. In addition, it should be focus on growth in terms of sales,production, etc.
(b) Following are the two values involved in the situation:
(i)Promotion of employment in backward areas.
(ii)Adoption of environment friendly methods of production

Business Management

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