MB0038 Management Process and Organizational Behavior

Master of Business Administration MBA Semester 1 MB0038 Management Process and Organizational Behavior Assignment Set - 1
Name Registration No. Learning Center Learning Center Code Course Subject Semester No. : : : : : : : Master of Business Administration Finance Management Process and Organizational Behavior Semester 1 Global Institute for Management Science Shafeer Sulaiman Sait

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Q1. State the characteristics of management. A1. Management is a distinct activity having the following salient features or characteristics: I. Goal - Oriented: Management is a purposeful activity. It co-ordinates the efforts of employees to achieve the goals for the organization. The success of management is measured by the extent to which the organizational goals are achieved. It is imperative that the organizational goals must be well-defined and properly understood by the managers at various levels. According to the Haimann, "Effective management is always management by objectives". Managers and other personnel officers apply their knowledge, experience and skills to achieve the desired objectives. II. Economic Resource: Management is one of the factors of production together with land, labour and capital. It is the most critical input in the success of any organized group activity. It is a force which assembles and integrates other resources, namely labour, capital and materials. These factors do not by themselves ensure production, they require the catalyst of management to produce goods and services required by the society. Thus, management is an essential ingredient of the organization. III. Distinct Process: Management is a distinct process consisting of such functions as planning, organizing, staffing, directing and controlling. These functions are so interwoven that it is impossible to lay down the exact sequence of various functions or their relative significance. Thus, the management process involves decision making and putting decision into practice. IV.Integrated Force: The essence on management is integration of human and other resources to achieve the desired objectives. All resources are available to those who manage. Managers apply knowledge, experience and management principles for desired results from the workers through non-human resources. Managers also seek to harmonize the individuals goals with the organizational goals for the smooth working of the organization. V. Intangible Force: It is an unseen force. Its presence is evidenced by the result of its efforts-orderliness, informed employees, buoyant spirit and adequate work output. Thus, management is result oriented. Its functioning is not visible but, its results are known. The effectiveness or ineffectiveness of the management is remarked on the basis of end results, although it is not observed during its operation.

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VI. Accomplishment through the efforts of Others: Managers cannot accomplish any task independently. Hence, they must have the necessary ability and skills to integrate and get work accomplished through the efforts of others. They must motivate the subordinates, in order to accomplish the tasks assigned. VII. Science as well as an Art: Management has an organized body of knowledge consisting of well defined concepts, principles and techniques which have wide applications. So it is treated as science. The application of these concepts, principles and techniques requires specialized knowledge and skills on the part of the manager. Thus, management is also viewed as an art. VIII. System of Authority: As a team of managers, management represents a hierarchy of command and control. Managers at different levels possess varying degrees of authority. The degree of authority gradually reduces as one move down the managerial hierarchy. Authority enables the managers to perform their functions effectively. IX. Multi-disciplinary Subject: As a field of study, the discipline of management takes the help of many other disciplines such as engineering, anthropology, sociology and psychology. Much of the management literature is the result of association of these disciplines. For example: Productivity orientation drew its inspiration from industrial engineering and human relations orientation from psychology. Similarly, sociology and operational research has also contributed to the development of management science. X. Universal Application: Management is universal in character. The principles and techniques of management are equally applicable in the field of business, education, military, government and hospital. Henry Fayol suggested that, principles of management would apply in more or less in every situation. The principles are working guidelines which are flexible and capable of adaptation to every organization where the efforts of humans are to be co-ordinated. Q2. What are the 14 principles of management of Henri Fayol? A.2 Following are the 14 principles of management of Henri Fayol: 1. DIVISION OF WORK: Work should be divided among individuals and groups to ensure that effort and attention are focused on special portions of the task. Fayol presented work specialization as the best way to use the human resources of the organization. To achieve the desired output, tasks should be divided among employees based on their skills and limits to further enhance development and productivity.

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2. AUTHORITY AND RESPONSIBILITY: The concepts of Authority and responsibility are closely related. Authority was defined by Fayol as the right to give orders and the power to exact obedience. Responsibility involves being accountable, and is therefore naturally associated with authority. Whoever assumes authority also assumes responsibility. 3. DISCIPLINE: A successful organization requires the common effort of workers. Penalties should be applied judiciously to encourage this common effort. This requires sound leadership, clear and unprejudiced arguments, and justified use of penalties. 4. UNITY OF COMMAND: Employees need clear cut orders to perform their function effectively, for this the directions should be provided by a single superior so as not to jeopardize the authority, stability, order and discipline. 5. UNITY OF DIRECTION: The entire organization should be moving towards a common objective in a common direction. This requires activities that should be co-ordinated effectively under a single head. 6. SUBORDINATION OF INDIVIDUAL INTERESTS TO THE GENERAL INTERESTS : The interests of one person should not take priority over the interests of the organization as a whole. 7. REMUNERATION: Many variables, such as cost of living, supply of qualified personnel, general business conditions, and success of the business, should be considered in determining rate of pay. It has to be justified and also should play a role to encourage effort, but should not lead to overpayment. 8. CENTRALIZATION: Fayol defined centralization as lowering the importance of the subordinate role. Decentralization is increasing the importance. The degree to which centralization or decentralization should be adopted depends on the specific organization as in its size, personnel, etc. 9. SCALAR CHAIN: Managers in hierarchies are part of a chain like authority scale. Each manager, from the first line supervisor to the president, possess certain amounts of authority. The President possesses the most authority; the first line supervisor the least. Lower level managers should always keep upper level managers informed of their work activities. The existence of a scalar chain and adherence to it are necessary if the organization is to be successful. Sideways communication is also possible so long as superiors are kept informed.

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10. ORDER: For the sake of efficiency and coordination, all materials and people related to a specific kind of work should be engaged in fields of their skills and capability. Orgnaizing work and selecting personnel is therefore very crucial. 11. EQUITY: All employees should be treated as equal with kindness. 12. STABILITY OF TENURE OF PERSONNEL: Retaining productive employees should always be a high priority of management. Recruitment and selection costs, as well as increased product-reject rates are usually associated with hiring new workers. As expertise development takes time, rapid turnover of personnel should be avoided. 13. INITIATIVE: Management should take steps to encourage employees initiative, which is defined as new or additional work activity undertaken through self direction. Such activities have to be contained within the organizations authority and discipline. 14. ESPIRIT DE CORPS: Management should encourage harmony and general good feelings among employees and avoid dissension and divisiveness.

Q3. Distinguish between internal and external forces of change. A.3 Forces of changes are two types: 1) Internal Forces 2) External Forces I. Internal Forces: Any change in organizations internal factors may also necessitate change. Such a change is required because of 2 reasons; 1) Change in managerial personnel 2) Deficiency in existing organizational practices 1. Change in Top Management: Change in Top management and consequent change in the ideas to run the organization also leads to change in the structure and processes. Replacement by new managers is necessitated due to retirement, promotion, transfer or dismissal. Each brings his own ideas and way of working into the organization.The formal or informal relationships may change because of changes in top management. Moreover, attitudes, ideology, leadership styles of the person may be different from the earlier one, this

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will reflect in their actions and decisions. The result is that an organization has to change accordingly. 2. Change in size of the organization: Change in the organizations size leads to chanfe in the internal structure and complexity of the operations in the organization. 3. Performance gaps: When a gap between set target and actual results (in terms od market share, employee productivity an profit) is identified, organizations face the forces to change and reduce the gap. 4. Employee needs and values: With changing need and values of the employees, organizations change their policies. For example, attractive financial incentives, challenging assignments, vertical growth opportunities and autonomy at work may be provided in an organization to attract and retain its effective employees. 5. Deficiency in existing organization: Sometimes, changes are necessary because of deficiency in the present organizational arrangement and process. These deficiencies may be in the form unmanageable span of management, large number of managerial levels, lack of co-ordination between various department, obstacles in communication, multiplicity of committees, lack of uniformity in policy decisions, lack of co-operation between line and staff and so on. II. External Forces: Each organization has goals and responsibility related to others in its environment. Thus, an organization must not only deal with its environment in conducting affairs, but also consideration to the goal of others, as it establishes its goals and conducts its operations. The present-day environment is dynamic and will continue to be dynamic. Changes in social, political, economic, technological and legal environment forces organizations to change themselves. Such changes may result in organizational changes like major functions, production process, labourmanagement relations, nature of competition, economic constraints, organization methods, etc. In order to survive in the changing environment, organization must change. 1. Technology: Technological changes are responsible for changing the nature of the job performed at all levels in an organization. When there is a change in technology in the organizations environment and other organizations adopt the new technology, the organization under focus becomes less cost effective and its competitive position weakens. Therefore, it has to adopt new technology. When the organization adopt a new technology, its work structures are effected and a new equilibrium has to be established. We have seen that technology has impact on organization structure, organization processes and behavior of people. For example,computer and automation have made significant impact on organizational functioning.

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2. Business Scenario: Due to rapid changes in the business scenario with increasing competition and global economy, the needs and demands are also changing among the customers, suppliers and other stakeholders. Organizations are, therefore, forced to change their operational methods to meet the demands of the stakeholders. Since every organization exports its outputs to the environment, an organization has to face competitions in the market. There may be two types of forces which may affect the competitive positions of an organization other organizations supplying the same products and, buyers who are buying the product. Any change in these forces may require suitable changes in the organization. For example, when Indian economy was liberalized (the process still continues), there were many foreign organization which entered the Indian market. This forced many Indian organizations to re-align themselves with the new situation. The result is that there have been many cases of divesting the business and concentrating on the core business, acquiring core business and developing competitive competence to face competitive threats. Similarly, there may be changes in buyers in terms of their needs, liking disliking and income disposal for a product. These changes force the organizations to bring those products which meet buyers requirements. 3. Environmental and National Factors: Environmental factors such as economic, political and demographic and legal factors play vital role in devising organizational policies and strategy. Any change in these political and legal factors may affect the organization operation. For example, organizations may have to change their employment policies in accordance with the government policy, demand of the non-government organizations and changing economic conditions of a country. 4. Social Changes: Social changes reflect in terms of peoples aspirations, their needs and their way of working. Social changes have taken place because of the several forces like level of education, urbanization, feeling of autonomy and international impact due to new information sources. These social changes affect the behavior of people in the organization. Therefore, it is required to make adjustment in its working so that it matches with people. Q4. Define emotional intelligence. Explain Golemans model of emotional intelligence. A.4 Emotional intelligence (EI) refers to the ability to perceive, control and evaluate emotions. Some researchers suggest that emotional intelligence can be learned and strengthened, while others claim it is an inborn characteristic. Since 1990, Peter Salovey and John D. Mayer have been the leading researchers on emotional intelligence. In their influential article "Emotional Intelligence," they defined emotional intelligence as, "the subset of social intelligence that involves the ability to monitor one's own and others' feelings and emotions, to discriminate among them and to use this information to guide one's thinking and actions" (1990).

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Daniel Goleman and the Hay Group have identified a set of competencies that differentiate individuals with Emotional Intelligence. The competencies fall into four clusters: Self-Awareness: Capacity for understanding one's emotions, one's strengths, and one's weaknesses. Self-Management: Capacity for effectively managing one's motives and regulating one's behavior. Social Awareness: Capacity for understanding what others are saying and feeling and why they feel and act as they do. Relationship Management: Capacity for acting in such a way that one is able to get desired results from others and reach personal goals. The most popular and accepted mixed model of emotional intelligence is the one proposed by Goleman (1995). He viewed emotional intelligence as a total of personal and social competences. Personal competence determines how we manage ourselves, whereas social competence determines how we handle our interpersonal relationships. Personal competence: It comprises of three dimensions of emotional intelligence, such as, self-awareness, selfregulation and motivation. Self-awareness is the ability of an individual to observe him/herself and to recognize 'a feeling as it happens' (Goleman, 1995). The hallmarks of this ability are selfconfidence, self- assessment and openness to positive criticism. Self-regulation is the ability to control emotions and to redirect those emotions that can have negative impact. Trustworthiness, integrity, tolerance of ambiguity and attitude to accept change are some characteristics of this ability. Motivation is the ability to channelize emotion to achieve a goal through self-control and by moderating impulses as per the requirement of the situation. The people who have this ability are optimistic and committed towards organizational as well as individual goals. Social competence: It comprises of two dimensions namely, empathy and social skills. Empathy is the ability to feel and get concerned for others, take their perspective and to treat people according to their emotional reactions. People with this ability are experts in generating and motivating others. Social skills are the ability to build rapport and to manage relationships with people. People having this skill are very effective in persuasiveness and team management. Social skill is the culmination of all other components of emotional intelligence assuming that people can

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effectively manage social and work relationships only when they can understand and control their own emotion and can emphasize with the feelings of others.

Q5. Explain the different leadership styles as per Managerial Leadership Grid Theory. A.5 The Managerial Grid is based on two behavioral dimensions: Concern for People This is the degree to which a leader considers the needs of team members, their interests, and areas of personal development when deciding how best to accomplish a task. Concern for Production This is the degree to which a leader emphasizes concrete objectives, organizational efficiency and high productivity when deciding how best to accomplish a task. i. Country Club Leadership High People/Low Production: This style of leader is most concerned about the needs and feelings of members of his/her team. These people operate under the assumption that as long as team members are happy and secure then they will work hard. What tends to result is a work environment that is very relaxed andfun but where production suffers due to lack of direction and control. ii. Produce or Perish Leadership High Production/Low People: Also known as Authoritarian or Compliance Leaders, people in this category believe that employees are simply a means to an end. Employee needs are always secondary to the need for efficient and productive workplaces. This type of leader is very autocratic, has strict work rules, policies, and procedures, and views punishment as the most effective means to motivate employees.

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iii. Impoverished Leadership Low Production/Low People: This leader is mostly ineffective. He/she has neither a high regard for creating systems for getting the job done, nor for creating a work environment that is satisfying and motivating. The result is a place of disorganization, dissatisfaction and disharmony. iv. Middle-of-the-Road Leadership Medium Production/Medium People: This style seems to be a balance of the two competing concerns. It may at first appear to be an ideal compromise. Therein lies the problem, though: When you compromise, you necessarily give away a bit of each concern so that neither production nor people needs are fully met. Leaders who use this style settle for average performance and often believe that this is the most anyone can expect. v. Team Leadership High Production/High People: According to the Blake Mouton model, this is the pinnacle of managerial style. These leaders stress production needs and the needs of the people equally highly. The premise here is that employees are involved in understanding organizational purpose and determining production needs. When employees are committed to, and have a stake in the organizations success, their needs and production needs coincide. This creates a team environment based on trust and respect, which leads to high satisfaction and motivation and, as a result, high production. Q6. Mr. Suresh Kumar is the VP- HR of a leading financial services company. He is having a meeting with Ms. Rejani Chandran leading HR consultant. Mr. Suresh is concerned about creating an environment that helps in increasing the job satisfaction amongst employees. Assume that you are Ms. Rejani, the HR consultant. What suggestions you will give to Mr. Suresh, for creating an environment that increases job satisfaction? A.6 Job satisfaction is the sense of fulfillment and pride felt by people who enjoy their work and do it well. It is a globally accepted fact that, high job satisfaction equals positive attitude towards the job and resultantly, better and quality production is evidenced. There are various factors that can increase the job satisfaction among the employees. Below are important suggestions that can be considered accordingly for creating an environment with increased job satisfaction: Delegation of fair responsibility and authority: Employee should be clearly communicated of their responsibilities and their capacity of function. They tend to feel important when they are made accountable in achieving the organizational task. Recognition and equitable rewards: It is quite natural, that an individual will strongly want to be recognized for his efforts. Similarly, employees have to be recognized for

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their hard work and efforts. It is also essentially and equally important to reward them justly for their contribution, which will further motivate them for a better or similar output. Opportunities for Job enrichment: All Employees wants to be upgraded eventually and strives for their aspiration and growth. Hence, it is very imperative to provide employees with opportunities to grow both personally and professionally. Favourable Working condition: Employees prefer physical conditions that are comfortable and facilitate doing a good job. So it is important to maintain adequate temperature, light, noise and other environmental conditions favourable for them. Social Gathering: It is vital to synchronize all employees of the organization, to enable a friendly and supportive work environment. So there has to be events organized to encourage social interaction, which will lead to better relationship between co-workers.

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