QUESTION 1

1.1 In companies large number of persons are employed and placed at different places to perform
different managerial activities. To carry on these activities these employees are given necessary
authority and responsibility. This grant of authority results in creation of chain of authority. This
chain is divided into three levels which result in creation of three levels of management. This
essay will differentiate between middle and lower level managers.

The middle level management consists of departmental heads such as purchase department head,
sales department head, finance manager, marketing manager, executive officer, plant
superintendent, etc. People of this group are responsible for executing the plans and policies
made by top level. They act as a linking pin between top and lower level management. They also
exercise the functions of top level for their department as they make plans and policies for their
department, organise and collect the resources etc (Cole, 2004).

While the lower level management consists of supervisors, superintendent, foreman, sub-
department executives; clerk, etc. Managers of this group actually carry on the work or perform
the activities according to the plans of top and middle level management. Their authority is
limited. The quality and quantity of output depends upon the efficiency of this level of managers.
They pass on the instruction to workers and report to the middle level management. They are
also responsible for maintaining discipline among the workers (Prasad and Gulshan, 2011).

1.2 Good management skills are vital for any organization to succeed and achieve its goals and
objectives. A manager who fosters good management skills is able to propel the company’s
mission and vision or business goals forward with fewer hurdles and objections from internal and
external sources. The following are some of the managerial skills.

Technical skills involve skills that give the managers the ability and the knowledge to use a
variety of techniques to achieve their objectives. These skills not only involve operating
machines and software, production tools, and pieces of equipment but also the skills needed to
boost sales, design different types of products and services, and market the services and the
products. For instance planning is a vital aspect within an organization (Cole, 2004). Planning is
one’s ability to organize activities in line with set guidelines while still remaining within the
limits of the available resources such as time, money, and labor. It is also the process of

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formulating a set of actions or one or more strategies to pursue and achieve certain goals or
objectives with the available resources. The planning process includes identifying and setting
achievable goals, developing necessary strategies, and outlining the tasks and schedules on how
to achieve the set goals. Without a good plan, little can be achieved (David, 2002).

Conceptual skills involve the skills managers present in terms of the knowledge and ability for
abstract thinking and formulating ideas. The manager is able to see an entire concept, analyze
and diagnose a problem, and find creative solutions. This helps the manager to effectively predict
hurdles their department or the business as a whole may face. A good manager must have the
ability to tackle and solve the frequent problems that can arise in a typical workday (Prasad and
Gulshan, 2011). Problem solving in management involves identifying a certain problem or
situation and then finding the best way to handle the problem and get the best solution. It is the
ability to sort things out even when the prevailing conditions are not right. When it is clear that a
manager has great problem-solving skills, it differentiates him/her from the rest of the team and
gives subordinates confidence in his/her managerial skills (David, 2002).

The human or the interpersonal skills are the skills that present the managers’ ability to interact,
work or relate effectively with people. These skills enable the managers to make use of human
potential in the company and motivate the employees for better results. Possessing great
communication skills is crucial for a manager. It can determine how well information is shared
throughout a team, ensuring that the group acts as a unified workforce. How well a manager
communicates with the rest of his/her team also determines how well outlined procedures can be
followed, how well the tasks and activities can be completed, and thus, how successful an
organization will be (Cole, 2004).

Communication involves the flow of information within the organization, whether formal or
informal, verbal or written, vertical or horizontal, and it facilitates smooth functioning of the
organization. Clearly established communication channels in an organization allow the manager
to collaborate with the team, prevent conflicts, and resolve issues as they arise. A manager with
good communication skills can relate well with the employees and thus, be able to achieve the
company’s set goals and objectives easily (David, 2002).

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1.3 Personnel Management.

Personnel Management is that branch of management which is concerned with the recruitment,
selection, development and the optimum use of the employees. In other words, personnel
management is concerned with the employees engaged at all levels of an organisation.

All means of production which includes men, materials, machines, and money, may be divided
into two parts active and passive. Active means include men while machines, materials, money
etc. belong to passive means of production. An enterprise may have large quantity of passive
means of production, such as, machines, materials and money but the same are of no use if not
properly utilized. These can be utilized properly only with the help of active means, that is,
human beings (Koontz, 1998).

What is needed is that such human resource be made available as is perfectly efficient. It is the
job of personnel management to make efficient human resource available. In order to fulfil this
task, personnel department is established in large organisations. This department functions under
the supervision of personnel manager.

QUESTION 2

2.1.1.

The scientific management theory (Taylorism) was developed by Frederick W. Taylor. Taylor
believed that time and motion were a scientific analysis of task for examining the physical
movements and requirements for the completion of task. The idea of Taylorism is found to be
consistent with the concerns of Adam Smith that emphasized division of labour bringing
specialization, which leads to enhanced productivity (Prasad and Gulshan, 2011). In doing so the
humans are treated as machines while ignoring the demoralizing and inhuman effects of tasks on
the workers. In addition to that, Taylor also commenced another study “science of shovelling”
for determining the optimal weight to be lifted by the workers, thus, the optimal shovels were
introduced to increase productivity while reward as increase in the pay was motivator. The major
notion of the motivation for employees under scientific management were seen as money.
During the same era, Frank and Lillian presented “applied motion study” focusing on reduction

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in the number of motions in a task in order to increase efficiency to have profit and satisfaction
of a worker (Koontz, 1998).

In the modern day, project management tools and techniques are used by organisations to ensure
there is elimination of waste while attainment of most efficient results indicating the use of
‘applied motion’ in operations. Program and review technique (PERT) charts are another
modern-day managerial tool offering visual methods to administer time and resources of project.
Nowadays, same scientific management approach is used with modifications as of now multiple
websites offer online solutions through interactive sessions, free tutorials and blogs discussion,
which are all based on Henry Gantt management theory (Prasad and Gulshan, 2011). Harrignton
Emerson stated twelve principles of efficiency that enables manager in defining objectives,
developing scientific methods for evaluation, forming standardized procedures and rewarding
employees (Koontz, 1998).

2.1.2

Administrative management theory is a contemporary school of thought to scientific

management, this school of thought is based on traditional or administrative principles of
management while prominent exponents include Henri Fayol, Chester Barnard and Colnel
Urwick (Cole, 2004). Henri Fayol is considered as the father of modern management for his
contribution in the administrative management field primarily focusing on the operational
approach through 14 principles of management. Fayol introduced unified concept by focusing on
managerial levels and the organisation as a whole (Prasad and Gulshan, 2011). All business
activities could be split into six groups namely; administrative, security, accounting, financial,
commercial and technical while focused on the managerial activities of manager including,
planning, organizing, directing, coordinating and controlling (Cole, 2004). Key principles
include division of work, authority and responsibility, discipline, unity of command, unity of
direction, subordination of individual interest to general interest, remuneration, centralization,
scalar chain, order, equity stability of tenure of personnel, initiative and esprit de corps (Stoner,
Freeman and Gilbert, 2009).

Fayol's heavily emphasized on rationality, logic and consistency (Don, 2002). Interestingly,
Taylor worked from the bottom of the hierarchy upward, whereas Fayol worked from the apex
downwards, with management centered philosophy, which is the difference between two

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classical schools of thoughts (Bartol, and Martin, 1998). On the other hand, Chester Barnard
argued that effective communication is essential for cooperation and there should be a balance
between rewards and contributions among workers. Colonel Urwick assembled the principles of
Taylor, Fayol and other management scholars and suggested that management is a dynamic
process to perform organisational activities (Don, 2002).

Weihrich, Cannice, and Koontz, (2011) argued that Henri Fayol's 14 principles of management
promoted efficiency through division of work, which are still recognised idea in the present day.
Additionally, Fayol acknowledged employees needs through adequate remuneration, stability of
tenure, equity, team spirit and initiative are all essential albeit coming from top down direction.
Hence, Fayol has not ignored the employee perspective in the organisational context. However,
although, it appears less applicable to some extent in modern day work environments. Moreover,
even in modern era, Fayol offers a good start for the managers and organisation to learn about
approaches, structures and managerial functions such as planning, forecasting, organizing,
directing, coordinating and monitoring (Bartol, and Martin, 1998).

2.1.3

Douglas McGregor in his book, human side of enterprises published in 1960 argued that there
are two types of individual in the organisation, respectively X and Y type. Theory X managers
have a negative view of workers and perceived them as untrustworthy, lazy, and lacking the
initiative to take responsibility (McGregor, 1960). Therefore, such types of managers are more
autocratic and rigid in their respective approach. The employees are seen to have low or no
motivation to take initiative by their own, thus, require set of directions to execute tasks. On the
other hand, Theory Y managers view employees are trustable and have the potential to take a
charge of responsibility. Furthermore, the employees are highly self-motivated (Bartol, and
Martin, 1998).

The Y type managers are participative and democratic in their style and thus motivates
employees by involving them actively in their routine tasks(Ibid). In modern era also there are
examples of theory Y managers. For instance, WL Gore and Associates is an organisation that
highly encourage managers to work as coach in encouraging employees to be creative and self-
initiators. Employees tend to perform better when allowed to exhibit their creativity with no
restriction Mintzberg (1993) argued that for lower/operational level employees Theory X

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managers/supervisors are more effective because the productivity to achieve specific unit
production is attained when there are directions given from the top. David (2002) argued that in
the 21st century still the theory is practically visible as there is higher focus on self-managed
workers and as a result they are involved in such programs so that they are more creative and
willing to take initiatives, which are aligned with the aspects of Theory Y.

2.1.4

In 1924, an experiment was conducted by Elton Mayo, an Australia-born sociologist at the

Hawthorne plant of the Western Electric Company, which made telephone hardware for AT&T.
The simple experiment was aimed at evaluating the effect of working conditions on productivity.
When the lighting in the work area for few workers was increased, it was observed that the
productivity of the workers in that particular bay had also increased. This went on to establish
the fact that change improved productivity (Mintzberg, 1993).

These workers were also part of several other successful experiments in the following years.
Their working hours and rest breaks were altered, and they were offered food during breaks. It
was observed that every small change brought in an improvement in productivity. The
experiments continued till 1932 and all these changes were reversed assuming that the
productivity will fall, but surprisingly there was no fall in productivity levels (David, 2002).

Mayo established that it wasn’t the change in physical environment that increased productivity,
but the belief of workers that they were valued, taken care of and that someone was concerned
about their workplace. In addition, getting the opportunity to discuss changes before they were
implemented contributed to the rise in productivity. This theory has been termed the Hawthorne
effect. This laid the foundation for what we call employee engagement today. It’s a known fact
that engaged employees are the most productive ones (Stoner, Freeman and Gilbert, 2009).

2.1.5

Re-engineering calls for rediscovering the objectives of a business, diagnosing ills and
discovering new paths to the objectives, design of a process, and then its implementation. It is
supposed to transform not only what is done but how it is done, thus to change the corporate
culture. Bloated, sloppy, slow, unresponsive, expensive, unfocused organizations are supposed to
become lean, quick, effective, responsive, competitive, agile, and concentrated. Since it could be

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applied to corporations as a whole or specific processes within the business such as purchasing,
marketing, production, etc.) It came to be called Business Process Reengineering and
abbreviated BPR (Don, 2002).

BPR is particularly interested in a company's processes rather than the organization's particular
tasks and employees. A process is defined as a series of steps whose outcome is a product or a
service. Research shows that the efficiency of processes translates into efficiency of the
organization. Therefore, the management has to think of the business's organization in terms of
processes rather than in terms of departments or units. Hence, apart from organization charts
companies are advised to work out process maps as well, which illustrate the workflows within
the organization. The process map is a mandatory prerequisite for the launch of the reengineering
process (Bartol, and Martin, 1998).

QUESTION 3

3.1 Environmental analysis is a strategic tool. It is a process to identify all the external and
internal elements, which can affect the organization's performance. The analysis entails assessing
the level of threat or opportunity the factors might present.

3.2 Environmental analysis is a strategic tool. It is a process to identify all the external and
internal elements, which can affect the organization’s performance. The analysis entails
assessing the level of threat or opportunity the factors might present. These evaluations are later
translated into the decision-making process. The analysis helps align strategies with the firm’s
environment. The following are the reasons why environmental analysis is vital.

It is necessary in the identification of strength and weakness of the company. Strength of the
business firm means capacity of the firm to gain advantage over its competitors. Analysis of
internal business environment helps to identify strength of the firm. After identifying the
strength, the firm must try to consolidate or maximize its strength by further improvement in its
existing plans, policies and resources. Weakness of the firm means limitations of the firm
(Porter, 2003). Monitoring internal environment helps to identify not only the strength but also
the weakness of the firm. A firm may be strong in certain areas but may be weak in some other

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areas. For further growth and expansion, the weakness should be identified so as to correct them
as soon as possible.

Environmental analysis aids decision-making: Decision-making is a process of selecting the best

alternative from among various available alternatives. An environmental analysis is an extremely
important tool in understanding and decision making in all situation of the business. Success of
the firm depends upon the precise decision making ability. Study of environmental analyses
enables the firm to select the best option for the success and growth of the firm (Weihrich,
Cannice, and Koontz, 2011).

3.3 Operating a successful business isn’t just about working hard, but rather about working
smart. This can mean improving on planning, management, and targeting, along with many other
things. The first step in actually doing so, though, is periodically reviewing and analyzing where
you are in the market, and what you are doing. Looking at the factors that affect the performance
and operation of your business can provide this information, which will tell you what exactly
might need improving. These factors can be positive or negative, and either internal or external.
What we mean by this is that these factors can either be as a direct consequence of the actions of
the company (internal), or completely unrelated and avoidable (external).

Changes to Laws: State, local or federal changes in the laws can have a direct impact on a firm’s
business if the service or product becomes highly regulated or outlawed. Cigarette manufacturers
learned this lesson when public smoking was outlawed in many areas and smoking indoors has
become practically nonexistent. Government regulations such as those that affect the
environment or communication are beyond your control and could have a direct impact on your
business (Porter, 2003).

Changing Trends and Technology: While an organisation may spend a good part of their profits
on marketing in the hopes of favorably influencing trends, some are beyond your control. An
increase in technology use by customers may be built into a firm’s strategic planning, but the
firm may not have planned for the widespread use of social media that could affect the business.
Celebrities who become advocates for a cause or decide to boycott a certain business practice
can start a trend that could seriously affect a firm’s business (Root, 2007).

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Changing Customer Base: The Company’s target customer base may change suddenly or slowly
over a period of time. The changing makeup of your neighborhood that attracts more singles or
young renters can affect your business for example if you cater to a more upwardly mobile,
family oriented customer base. Cultural implications of a changing neighborhood may affect
your business negatively or positively depending on your ability to meet the needs of changing
demographics (Porter, 2003).

Economic situation: Economy is one of the most determining factors to the success of the
company even though it is an external element. Within the economy, some contributing factors
such as the fluctuation of interest rate, economic crisis, and so on directly and strongly affects the
consumption of buyers, and consequently, the profits of businesses (Root, 2007).

No external factors affect business more than an economic condition, which is the present state
of the economy. As the economy goes through expansion and contraction, its condition changes
over time. Positive economy condition can be favorable for business development and adverse
ones may generate negative consequences such as narrow down business scale, capital shortage
or even bankrupt.

3.4 Totality of External Forces: Business environment is the sum totals of all those factors/forces
which are available outside the business and over which the business has no control. It is the
group of many such forces that is why, its nature is of totality (Root, 2007).

Uncertainty: Nothing can be said with any amount of certainty about the factors of the business
environment because they continue to change quickly. The professional people who determine
the business strategy take into consideration the likely changes beforehand (Don, 2002). But this
is a risky job. For example, technical changes are very rapid. Nobody can anticipate the
possibility of these swift technical changes. Anything can happen, anytime. The same is the
situation of fashion.

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 References

Bartol, K.M., & Martin, D.C. (1998). Management, USA: McGraw Hill.

Cole G. A. (2004). Management Theory and Practice. Bedford Row: Thomson Learning.

David B. (2002). Management: An introduction. Gosport: Ashford Colour Press.

Don M. B.. (2002). Management and Organization theory (3rd edition). Port Harcourt:
Sherbrooke Associate.

Koontz, H. (1998). Management, 9th Edition, USA: McGraw Hill Inc.

McGregor, D. (1960). The Human Side of Enterprise. New York: McGraw-Hill Book
Company.

Mintzberg, H. (1993). The Study of Managerial Work. New York: Harper& Row.

Prasad, L., & Gulshan, S.S. (2011). Management Principles and Practices, India, New Delhi:
Excel Books.

Porter, M. E. (2003). Competitive strategy. New York: Free Press.

Root, F. (2007). Foreign Market Entry Strategies. New York: AMACOM.

Stoner J. A. F, Freeman E. R, Gilbert R. D. (2009). Management. New Delhi: Dorling

Kindersley Ltd.

Weihrich H, Cannice, M. V, Koontz H. (2011). Management: A global and entrepreneurial

perspective. Shahdara: SDR printers.

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