MB 38 IA

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Question 1

Define the terms Strategy? Explain

1) Corporate strategy

2) Business strategy3) Functional strategy

Answer STRATEGY:

Strategy means the grand plan which helps in executing the Vision. The term is borrowed from the

military which distinguished between the grand plan and actual action by calling the former

strategy and the latter tactics.

1) CORPORATE STRATEGY

The ESSAR group has several businesses but they have only one corporate headquarter which

controls all business. Each of these businesses may be run by an independent company like

ESSAR STEEL run the steel business and ESSAR POWER runs the power business (they both

are different companies).The corporate headquarters will have grand plans on how each business

should operate. For example, it might say that that ESSAR STEEL should develop and production of

various grades of steel or that ESSAR POWER should expand business to various part of India like

Orissa, Madhya Pradesh.

This grand plan created by the corporate headquarters is called „Corporate Strategy‟. It lays down

the grand plan to be followed by each business under a corporate headquarters.

DRIVE SPRING 2014

PROGRAM MBADS/ MBAFLEX/ MBAHCSN3/ MBAN2/ PGDBAN2

SEMESTER 1

SUBJECT CODE &

NAME

MB0038 – Management Process and Organization Behavior

BK ID B1621

CREDIT & MARKS 4 Credits, 60 marks

Roll no 1402006410

Name : SUJIT EZHUTHASSAN

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2) BUSINESS STRATEGY

Every business, small or big, will have a business strategy. This is the grand

plan doing business. For example, ESSAR STEEL can make a grand plan of

expanding his business to other states of India. They can take a decision to be

the provider of low cost steel roll sheets. This is what business strategy is. If

we take an example of ESSAR, each business of ESSAR (say ESSAR OIL,

ESSAR STEEL, ESSAR POWER, etc) would have their own business

strategy in consonance with the corporate strategy.

3) FUNCTIONAL STARETEGY

Once you have a business strategy, each independent department will need

its own strategy. For example, the HR of ESSAR STEEL will need a

strategy quite different from the HR of ESSAR POWER. So, the

operations, marketing, finance, HR, etc of each business will make their owngrand plan or strategy and this is called functional strategy. In other words,

the grand plan made by each functional area is called functional strategy.

Usually organizations have operations strategy, finance strategy, marketing

strategy, and HR strategy. If you are large and well diversified, you may

have an information strategy, supply chain strategy, etc. also and this

depends to some extend on the nature of your business. For example, if you

are in retail chain business like Reliance Hypermart, you may have a

merchandise strategy (what products to sell) and supply chain strategy

(how to procure the products at the lowest cost and move them nationally) as

these are very important to business success.

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Question 2 Define the term ‘management’. Explain the Behavioral science

theory and Systems theory.

Answer 2 Management :

According to F.W. Taylor , “ Management is an art of knowing what to do,

when to do, and see that it is done in the best and cheapest way”.

According to Harold Koontz, “ Management is an art of getting things one

through and with people in formally organized groups. It is an art of creating

an environment in which people can perform as individuals and can co-

operate towards the attainment of group goals”.

BEHAVIOURAL SCIENCE THEORYThe thought of behavioral science theory was originated by Wilfred

Pareto in 1896, and he researched do on organization and management

relationship. Later, Hugo Munsterberg applied psychology to increase

industrial production in 1912 and around the same time, Walter Dil Scott

applied psychology to advertising, marketing, and personnel in 1910

and 1911. But it was Elton Mayo and F.J Roethlisberger who made

an impact on the behavioral science theory through their Hawthorne

experiments in Western Electric Company in 1933. These experiments

proved that good working relationship with the supervisor and colleagues

and the idea of challenge in the job accounted for higher productivity.Challenge is created through setting high goals which cannot be

normally achieved but which can be achieved with a little additional

effort. These experiments brought to fore the importance of behavioral

science in management. Extending the idea sometime in 1946 and 1947,

Max Weber propounded the theory of bureaucracy.

SYSTEM THEORY

Though the systems theory can be traced to biology, where we have

cardiovascular system, nervous system, etc which are fairly independentyet interdependent, it was Chester Barnard who extended this into

management area through his writing „Functions of the Executive‟ in

1938. In systems theory, we perceive that organizations have a number

of fairly independent systems such as purchase system, operations

system, marketing system, financial system, etc. The working of these

are independent, but it has to be integrated by the manager. This theory,

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perhaps, brings the idea of Integration as a key component of

management.

Question 3Give the definition and importance of planning in an

organization and explain the steps in planning.

Answer 3

Definition :

PLANNING

Planning can be defined as a basic management function which

enables one to select the purpose of the business, and how the

resources should be utilizes to achieve that purpose to include

using the available resources optimally to do that. Planning implies

goal setting for the organization keeping in mind the constraints,

opportunities, and threats as much as what the person or business which

is planning wants to do. Thus, a plan is a blueprint for goal

achievement, a blue print that specifies the necessary resource

allocations, schedules, tasks, and other actions to achieve the

purpose.

IMPORTANCE OF PLANNING

Planning is important for the following reasons:

It helps the management to clarify, focus, and research their

businesses or project's development and prospects.

It provides a considered and logical framework within which

a business can develop and pursue business.

It offers a benchmark against which the actual performance

can be measured and reviewed.

It plays a vital role in helping to avoid mistakes or recognize

hidden opportunities.

In the business context, it guides the development of products,

management, finances, and most importantly, markets and

competition.

It helps in forecasting the future and makes the future visible

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to some extent.

It bridges between where we are and where we want to go.

There are Eight steps in Planning as shown in below

1)

Being aware of opportunities2) Establishing objectives

3) Developing premises

4) Determining alternative courses

5) Evaluating alternative courses

6) Selecting a course

7) Formulating plans

8) Qualifying plans by budgeting

Explanation of Each steps of planning in detail

1) Being aware of opportunities – This means being aware of

the customer needs, market, competition, our strengths,

and weaknesses. This is usually done through market

research, competitor analysis, and analysis of own strengths

and weaknesses through a formal process called SWOT

analysis (Strength, Weaknesses , Opportunity, and Threat).

2) Establishing objectives – This implies establishing what we

want to be and what we want to accomplish and when and inrelation to which market segment. At the highest level,

this is done through vision and mission building. This

process takes place at business level, project level, etc also

3) Developing premises – Deciding on the environment (both

external and internal) in which our plans are going to

operate. Business has external environment created by

political factors to include legislation, legal framework, etc

The external analysis is done through a process called

PEST analysis (Political, Economic, Social, and

Technological). Some add culture as an additional separatefactor while others include it in Social. PEST is a framework

and helps you to think systematically through the factors that

could affect. In relation to the business mission, each of the

factors may become a threat or opportunity (or of course may

be neither).

4) Determining alternative courses – Identifying the most

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promising alternatives to accomplish what we want to. This is

done by combining the information about the opportunities,

threats, and own strength and weaknesses. This is done

through another framework called TOWS (Threat,

opportunity, weakness and strength) matrix.

5) Evaluating alternative courses –

Comparing the alternatives

to find out which of them will meet our goals and at

optimal cost and profit keeping sustainability into mind.

6) Selecting a course – Selecting the course that we want to

follow.

7) Formulating plans – This implies making plans that support

the course of action by buying equipment, space, planning the

type of HR, etc.

8) Qualifying plans by budgeting – Identifying the cost involved,

how the financial resources will be mobilized, what is capitalexpenditure, what is operational expenditure, the working

capital, etc.

Question 4 What is meant by leading? Describe the characteristics of

leading.

Answer Leading can be defined as the process of setting direction, creating

alignment, and creating engagement to deliver high productivity and to

facilitate change.

Leading rather than directing, liberated the human spirit of

independence and desire to meet challenging goals and surpass

them. These organization showed profits several times more than

those that were still in the world of directing and they easily glided

through many economic downturns. Southwest Airlines of the U.S is

a classical example wherein it reported profit quarter after quarter

for over 30 years without a break when every other airline was

reporting loss. Closer home, Infosys did the same as also the Birla

group, which in a matter of two decades transformed itself into a

multi business giant. Thus directing and leading are not mutually

exclusive, nor are they two sides of a coin. They can be perceived

to be a continuum along which organizations to achieve maturity in

getting work done and surpassing the goals. Directing is therefore an

essential part of leading but is insufficient to compete in the

contemporary world; where leading is the key to creating competitive

advantage. There are several text books which project leading as a

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subset of directing but a reality check indicates that the vice versa is

true. Leading or leadership function is said to be the heart of

management process. Therefore, it is the central point around which

accomplishment of goals take place. A few philosophers call leading

as “Life spark of an enterprise”. It is also called as an actuating

function of management because it is through direction that the

operation of an enterprise actually starts. Being the central character

of an enterprise, it provides many benefits to a concern.

CHARACTERISTIC OF THE LEADING

1) Pervasiveness

Leading is required at all levels of organization. It is incorrect to believe that

leading is required only at the top level. He/she may be motivating a team of

5 or 10 people while the CEO may be motivating the whole company, but

the function of giving targets, resources, support, motivating, etc. does notchange.

2) Continuity

Leading is a continuous activity as it is continuous throughout the life of

organization. It takes place on a day to day basis though its importance may

become higher when the organization is undergoing a change.

3) Human factor

It follows that there is a key human factor in leading and because human factor

is complex and behavior is unpredictable, leading function is important and

people have to learn the art of leading. Further, this characteristic is based on

the belief that Human beings are motivated by challenging jobs and they feel

a sense of achievement in doing these. The premise is also that people

normally work towards achieving the goals i.e., human being have a goal

oriented behavior.

4) Creativity

Leading is a creative activity because of the human factors and individual

variances and group Variances. It is the creativity aspect which brings in the

differentiation. Hence, we can see that creating functions around which people

find meaning is a creative function that leads to achievements.

5)

Executive functionLeading is carried out by all managers and executives at all levels throughout

the working of an enterprise. A follower receives tasks, resources, know-how,

and support from a leader and he/she trusts his/her leader to do the same.

6) Delegating function

Leading implies guiding followers to the destination. It means that the

followers actually execute and if they have to execute, they need the powers

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for doing so. Hence, delegating is natural fallout of leading. It also follows that

the leader trusts his/her followers and the vice versa. Hence, mutual trust

always exists in leading. Therefore, delegating function based on mutual trust

is a characteristic of leading.

Question 5 what are ‘attitudes’? Explain the components and

functions of attitude.

ANSWER 5

ATTITUDES:

Attitudes are also known as "frames of reference." They provide the

background against which facts and events are viewed. It becomes

necessary to know the attitudes of members of an organization because

they have to perceive specific aspects like pay, hours of work, promotion,

etc. of their work life in the wider context of their generalized

attitudes An attitude is the predisposition of the individual to evaluate someobjects in a favorable or an unfavorable manner. The most pervasive

phenomenon is "attitude." People at work place have attitudes about lots of

topics that are related to them. These attitudes are firmly embedded in a

complex psychological structure of beliefs. Attitudes are different from

values. Values are the ideals, whereas attitudes are narrow. They are our

feelings, thoughts and behavioral tendencies toward a specific object or

situation.

COMPONENTS OF ATTITUDE

There are three components of an attitude namely 1) Cognition, 2) Affect and 3) Behavior.

1) Cognition. It is the mental process involved in gaining knowledge and

comprehension, including thinking, knowing, remembering, judging and problem

solving. The cognition component of an attitude reflects a person‟s perceptions or

beliefs. Cognitive elements are evaluative beliefs and are measured by attitude

scales or by asking about thoughts.

2) Affect. This component refers to the person's feelings that result from his/her beliefs

about a person, object or situation. A person who believes that hard work earns promotions may feel angry or frustrated when he/she works hard but is not

promoted. The affective component Becomes stronger as an individual has more

frequent and direct experience with a focal object person or situation. 'Affect' is the

emotional component of an attitude. It refers to an individual's feeling about

something or someone.

3) Behavior. This component refers to the individual's behavior that occurs as a result

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of his or her feeling about the focal person, object or situation. An individual may

complain, request a transfer, or be less productive because he or she feels

dissatisfied with work. The behavioral component of an attitude refers to an

intention to behave in a certain way toward someone or something.

FUNCTION OF ATTITUDES

According to Katz, attitudes serve four important functions from the

viewpoint of organizational behavior. These are as follows:

1) Adjustment function. Attitudes often help people to adjust to their work

environment. Well treated employees tend to develop a positive attitude towards

their job, management. Attitudes help employees adjust to their environment and

form a basis for future behavior.

2) Ego-defensive function. Attitudes help people to retain their dignity and self-

image. When a young faculty member who is full of fresh ideas and enthusiasm,

joins the organization, the older members might feel somewhat threatened byhim/her. But they tend to disapprove his

Creative ideas as „crazy‟ and „impractical‟ and dismiss him/her altogether.

3) Value-expressive function. Attitudes provide individuals with a basis for

expressing their values. For example, a manager who values hard and sincere work

will be more vocal against an employee who is having a very casual approach

towards work.

4) Knowledge function. Attitudes provide standards and frames of reference that

allow people to understand and perceive the world around them. If one has a strong

negative attitude towards the management, whatever the management does, even

employee welfare programmers‟ , can be perceived as something „bad‟ and asactually against them.

Question 6 Define leadership. Differentiate between ‘Laissez Faire’ and

‘democratic’

Answer

LEADERSHIP:

" Leadership is a function of knowing yourself , having a vision that

is well communicated, bui lding trust among coll eagues, and taking effective

action to realize your own leadership Potenti al ."

A simple definition of leadership is that leadership is the art of

motivating a group of people to act towards achieving a common goal. This

definition of Leadership captures the leadership essentials of inspiration and

preparation.

Effective leadership is based upon ideas but won't happen unless those

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ideas can be communicated to others in a way that engages them.

In simple words, the leader is the inspiration and the director of the action.

LAISSEZ FAIRE LEADERSHIP STYLE

Nelson and Quick defines it as “a style of leadership in which the leader fai ls to

accept the responsibi l it ies of the posit ion ”.

Its distinct characteristics are:

1) Allows followers free rein to set their own goals

2) Engages in noncommittal, superficial communication

3) Avoids discussion with followers to set policy and procedures

4) Avoids interaction

5) Provides suggestions and alternatives for the completion of tasks only when

asked to do so by followers6) Provides infrequent feedback of any kind

7) Avoids offering rewards or punishments

8) May exhibit either poor or effective listening skills

9) Avoids conflict

DEMOCRATIC

Nelson and Quick defines democratic leadership as “a style of leadershi p

in wh ich the leaders takes collaborati ve, responsive, interactive actions with

fol lowers concern ing the work and the work envir onment ”.

Its distinct characteristics are:

1) Involves followers in setting goals

2) Engages in two-way, open communication

3) Facilitates discussion with followers

4) Solicits input regarding determination of policy and procedures

5) Focuses on interaction

6) Provides suggestions and alternatives for the completion of tasks

7) Provides frequent positive feedback

8) Rewards good work and uses punishment only as a last resort

9) Exhibits effective listening skills

10) Mediates conflict for group gain

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MB 38 IA