Association of Chartered Certified Accountants (ACCA) Certification Practice Test

How is management effectively defined?

1. Maximizing profits through increased sales

2. Effective use and coordination of resources to achieve objectives

3. Implementing human resource initiatives within an organization

4. Setting financial targets for fiscal accountability

The correct answer is: Effective use and coordination of resources to achieve objectives

Management is effectively defined as the effective use and coordination of resources to achieve objectives because this definition encompasses a broad range of activities necessary for an organization to operate smoothly and successfully. Management involves planning, organizing, leading, and controlling various resources – including human resources, financial resources, physical assets, and information – to meet the goals of the organization. This definition highlights the core function of management: ensuring that all resources are utilized efficiently and effectively, which is crucial for achieving desired outcomes. Coordination is also a critical aspect because it emphasizes the need to integrate various activities and departments within an organization. By aligning these resources and efforts towards common objectives, management plays a vital role in driving organizational success. In contrast, the other options represent narrower or more specific aspects of management. While maximizing profits, implementing human resource initiatives, and setting financial targets are all important components of management, they do not capture the comprehensive nature of what management entails. Management is not solely about profits or financial accountability; instead, it is about orchestrating a wide array of resources and activities to ensure that the overall objectives of the organization are met.