Management Theory and Practice

Semester 01

June 2022 Examination

Q1. Discuss the expansion from the point of view of Hofstadter’s five dimensions to include in the
training.
Answer:
Introduction:
Hofstede's “Cultural Dimensions Theory”, established by Geert Hofstede, a Dutch control researcher, in
1980. The reason for the examination turned into to discover the components of culture that differ and provides
a framework that describes the effects of culture on the values of its members, and how these values relate to
behavior and have formed a fundamental framework for International business people, psychologists,
communications researchers, and diplomats to distinguish between particular national cultures, their aspects,
and their effect in a commercial context.

Hofstede studied people who worked for IBM in more than 50 countries. Initially, he identified four
dimensions that could distinguish one culture from another. Later, he added fifth and sixth dimensions, in
cooperation with Dr Michael H. Bond and Michael Minkov.

Power
Distance

Individualism
Long Term
Versus
Hofstede's
Orientation
Collectivism

Cultural
Dimensions

Masculinity
Uncertainty
Versus
Avoidance
Femininity

Since then, it's become an internationally recognized standard for understanding cultural differences
Concept and application:
Allow us to understand the five dimensions of Hofstede:

1. Power Distance: Power distance is the willingness of a culture to accept status and power
differences among its members. In cultures with low power distance, people are likely to expect that
power is distributed rather equally, and are furthermore also likely to accept that power is distributed
to less powerful individuals. As opposed to this, people in high power distance cultures will likely
both expect and accept inequality and steep hierarchies.
Application: According to the model, in a high PDI country, such as India (77), team members will
not initiate any action, and they like to be guided and directed to complete a task. If a manager
doesn't take charge, they may think that the task isn't important.

PDI Characteristics Tips

High PDI  Centralized organizations.  Acknowledge a leader's status. As an outsider, you may try to
 More complex hierarchies circumvent his or her power, but don't push back explicitly.
 Large gaps in compensation, authority and
respect.  Be aware that you may need to go to the top for answers.

2. Individualism-Collectivism: In individualistic cultures people are expected to portray themselves

as individuals, who seek to accomplish individual goals and needs. In collectivistic cultures, people
have greater emphasis on the welfare of the entire group to which the individual belongs, where
individual wants, needs and dreams are often set aside for the common good. A society’s position on
this dimension is reflected in whether people’s self-image is defined in terms of “I” or “we.

India ranks (48) against the world average of 43 and there is no standard for rewarding employees
proactive in their career advancement. This concept is traditional in an individualistic culture, and
India cannot be categorized that way. This means that we cannot expect managers in India to ask for
decisions from an employee of a company without contacting someone having authority first

IDV Characteristics Tips

 High value placed on people's time and their need for  Acknowledge individual accomplishments.
High
IDV privacy and freedom.  Don't mix work life with social life too much.
 An enjoyment of challenges, and an expectation of  Encourage debate and expression of people's own
individual rewards for hard work. ideas.
 Respect for privacy.
 3. Masculinity-Femininity: The Masculinity side of this dimension represents a preference in society
for achievement, heroism, assertiveness, and material rewards for success. Society at large is more
competitive. Its opposite, Femininity, stands for a preference for cooperation, modesty, caring for the
weak and quality of life. Society at large is more consensus-oriented. It is the tendency of a culture
to stereotypical masculine or feminine traits. These values concern the extent on emphasis on
masculine work related goals and assertiveness (earnings, advancement, title, respect et.), as opposed
to more personal and humanistic goals (friendly working climate, cooperation, nurturance etc.)

India has Masculinity as the third highest ranking Hofstede dimension at 56, with the world average
just slightly lower at 51. The higher the country ranks in this dimension, the greater the gap is
between values of men and women. It may also generate a more competitive and assertive female
population, although still at a slower rate as compared to the male population.

Application: As we've highlighted, India has the highest MAS score of 56, therefore, if you open an office in
India, you should recognize you are operating in a hierarchical, deferential and traditionally patriarchal society.
Long hours are the norm. And this can make it harder for female team members to gain advancement, due to
family commitments.

MAS Characteristics Tips

High  Strong egos – feelings of pride  Be aware of the possibility of differentiated gender roles.
MAS
and importance are attributed to  A long-hours culture may be the norm, so recognize its opportunities and
status. risks.
 Money and achievement are  People are motivated by precise targets, and by being able to show that
important. they achieved them either as a group or as individuals.

4. Uncertainty Avoidance: UA addresses a society’s tolerance for uncertainty and ambiguity. It reflects
the extent to which members of a society attempt to cope with anxiety by minimizing uncertainty
Avoidance is referring to a lack of tolerance for ambiguity and a need for formal rules and policies.
This dimension measures the extent to which people feel threatened by ambiguous situations. These
uncertainties and ambiguities may e.g. be handled by an introduction of formal rules or policies, or
by a general acceptance of ambiguity in the organizational life.
Uncertainty Avoidance. India’s rank in the Uncertainty Avoidance dimension is 40, compared to the world
average of 65. On the lower end of this ranking, the culture may be more open to unstructured ideas and
situations. The population may have fewer rules and regulations controlling every unknown and unexpected
event or situation, as it is the case in high Uncertainty Avoidance countries. Normally a low score is ‘good’, as
it means that the society has fewer rules and does not attempt to control all outcomes and results. It also means a
greater level of tolerance for a variety of ideas, thoughts, and beliefs and a high tolerance for ambiguity

PDI Characteristics Tips

Low  Openness to change or innovation, and  Ensure that people remain focused, but don't create too much
UAI
generally inclusive. structure.
 More inclined to open-ended learning  Titles are less important, so avoid "showing off" your knowledge or
or decision making. experience. Respect is given to those who can cope under all
 Less sense of urgency. circumstances.

5. Time Orientation: It refers to the time horizon people in a society display. The degree to which cultures
encourage delaying gratification or material, social, emotional needs of the members: LT places more
importance on the future, pragmatic values, oriented toward rewards like persistence, thrift, saving, and capacity
for adaptation. Short term values are related to the past and the present (not future) with emphasis on immediate
needs, quick results, and unrestrained spending often in response to social or ecological pressure.

India’s Long Term Orientation dimension rank is 61, with the world average at 48. A higher Long Term
Orientation score can be indicative of a culture that is perseverant and parsimonious. India has a very high score
meaning that their culture is more persistent and thrifty. Indians' have a sense of shame that is shared amongst a
group of people and relationships are viewed by order of status. It’s interesting to note that even when Indians
travel abroad they work very hard and sacrifice a lot for long-term benefit, which is the education of their
children. Remaining in one job is also an indication of long term orientation and this once very common feature
is changing due to economic growth

Conclusion:

Therefore, talking about the growth of the inexperienced Bell in the smaller towns of India, all of the above
discussed five dimensions of Hofstede ought to be considered. They should maintain strict rules to establish on
how they relate with both clients and competitors and with this authority is established and should provide equal
opportunity to both masculine and feminine roles at work in order to achieve more. While figure out how to
manage dubious circumstances and have capacity to bear vagueness and uncertain situations and develop
tolerance for ambiguity and be patient with their growth as time is a key component.
Q2. Discuss various types of decisions managers typically make based on nature of the decisions, level of
the management or capacity. (10 Marks)

Ans 2.
Introduction:
Decision making is considered one of the most important tasks of management. The manager plays a crucial
role in serving his/her decision, as the growth and failure of an organization are dependent on timely decisions
taken. Each managerial decision like planning, organizing, staffing, and directing are all parts of decision
making. It is important to recognize that managers are continually making decisions, and that the quality of their
decision-making has an impact sometimes quite significant on the effectiveness of the organization and its
stakeholders. Stakeholders are all the individuals or groups that are affected by an organization (such as
customers, employees, shareholders, etc.).

Concept and application:

Managerial Decisions drive the business trajectory. The right decisions can increase profitability, promote
growth, and maintain stability. The wrong decisions can have the opposite effect, possibly jeopardizing an
organization’s health. regularly make decisions that affect the future of the organization and all its stakeholders,
such as deciding whether to pursue a new technology or product line. A good decision can enable the
organization to thrive and survive long-term, while a poor decision can lead a business into bankruptcy.
Managers at lower levels of the organization generally have a smaller impact on the organization’s survival, but
can still have a tremendous impact on their department and its workers. Consider, for example, a first-line
supervisor who is charged with scheduling workers and ordering raw materials for her department. Poor
decision-making by lower-level managers is unlikely to drive the entire firm out of existence, but it can lead to
many adverse outcomes

Making decisions is an important aspect of planning. Decision making can also be classified into categories
based on the level at which they occur.

Based on Level of Based on Nature

Managment •Programmmed Decisions
•Statergic Decisions •Non - Programmed Decisions
•Tactical Decisions
•Operational Decisions
 1. Programmed decisions are traditionally made using standard operating procedures or other well-
defined methods. These are routines that deal with frequently occurring situations, such as requests for
leaves of absence by employees. In routine situations, it is usually much more desirable for managers to
use programmed decisions than to make a new decision for each similar situation. In programmed
decisions, managers make a real decision only once, when the program is created. Subsequently, the
program itself specifies procedures to follow when similar circumstances arise.
2. Non-Programmed Decisions are taken in unstructured situations which reflect novel, ill-defined and
complex problems. The problems are non-recurring or exceptional in nature. Since they have not
occurred before, they require extensive brainstorming. Managers use skills and subjective judgment to
solve the problems through scientific analysis and logical reasoning .
3. Strategic Decisions reflect scope of decision-making processes. Strategic decisions are major choices of
actions and influence whole or a major part of business enterprise. They contribute directly to the achievement of
common goals of the enterprise. They have long-term implications on the business enterprise. They may involve
major departures from practices and procedures being followed earlier. Generally, strategic decision is
unstructured and thus, a manager has to apply his business judgement, evaluation and intuition into the
definition of the problem. These decisions are based on partial knowledge of the environmental factors
which are uncertain and dynamic. Such decisions are taken at the higher level of management.
4. Tactical Decisions relate to the implementation of strategic decisions. They are directed towards
developing divi-sional plans, structuring workflows, establishing distribution chan-nels, acquisition of
resources such as men, materials and money. These decisions are taken at the middle level of
management.
5. Operational Decisions relate to day-to-day op-erations of the enterprise. They have a short-term
horizon as they are taken repetitively. These decisions are based on facts regarding the events and do not
require much of business judgment. Operational decisions are taken at lower levels of man-agement. As
the information is needed for helping the manager to take rational, well informed decisions, information
systems need to fo-cus on the process of managerial decision making.

Conclusion:

When it comes to making decisions, one should always weigh the positive and negative business consequences
and should favour the positive outcomes. This avoids the possible losses to the organization and keeps the
company running with a sustained growth. Sometimes, avoiding decision making seems easier; especially,
when you get into a lot of confrontation after making the tough decision. But, making the decisions and
accepting its consequences is the only way to stay in control of your corporate life and time. It is therefore
important to be mindful about whether our decisions have a positive or a negative impact.
Q3. A. Discuss the features of divisional structure of organization and infer the divisions that
Earthmovers may have employed. (5 Marks)

Ans 3a.
Introduction:
The Divisional Structure is a type of organizational structure that groups each organizational function into a
division. It is a type of organizational structure that groups each organizational function into a division, Here
separate functions such as Production, HR, and finance can be seen under each division to support each product
line. These divisions can correspond to either products or geographies. With a divisional org structure, each unit
is equipped with its own resources to function independently. The industry and business sector, the number of
employees and your objectives and desired control over the units can determine whether it is useful to
implement a divisional organizational structure for your company. It facilitates expansion and growth as new
divisions can be added without interrupting the existing operations by merely adding another divisional head
and staff for the new product line. This approach tends to yield faster responses to local market conditions.

Concept and application:

The divisional structure strengthens the company in different ways. The individual divisions of the company are
independent financially and that allows them to determine clear routes of accountability and responsibility.
Financial independence also creates cooperation among the divisions without competition.

Different specializations (divisions) help employees further develop their skills in their own area of expertise.
As each division is independent, it can respond quickly to external changes in the business environment without
affecting divisions of the company

Capabilities of the divisional shape of organization:

• Product specialization helps in the development of varied skills in a divisional head and this prepares
him for higher positions. This approach makes it much easier to assign responsibility for actions and results.

• Divisional heads are accountable for profits, as revenues and costs related to different departments can
be easily identified and assigned to them. In particular, a division is run by its own management group, which
looks out for the best interests of the division.

• It promotes flexibility and initiative because each division functions as an autonomous unit which leads
to faster decision making. Allows decision-making to be shifted downward in the organization, which may
progress the company’s capability to respond to local market conditions.
• A notable advantage of the divisional structure is that it promotes expansion. Evidently, if an enterprise
tries to step into a new product’s market, it can simply do so by adding a new division for that product line
without interfering with the existing structure.

A divisional structure is a type of organizational structure that organizes business activities into categories like
products or services, customer groups and geographical locations. Large businesses depend on divisional
structures and create individual units, distributing functions between the parent organization (headquarters) and
its subsidiaries (the branches)

A real-life example of the divisional structure is PepsiCo’s structure. There are several global divisions
including North America Beverages (NAB), Frito-Lay North America (FLNA), Quaker Foods North
America, Latin America, Europe Sub-Saharan Africa (ESSA) and Asia, Middle East & North Africa
(AMENA).

Conclusion:

In the given case, Earth Movers Ltd provides services to heavy automobiles, and they have numerous heavy
cars like tractors, cranes, bulldozers, mixer vans, and so on. As a result, the department of the employer has
been achieved according to the sort of product to which the services must be provided. Human beings are
grouped collectively in a divisional structure relying on the product or service they deliver, not the labor they
adopt.
b. Elaborate on the factors that influence organizational structures. (5 Marks)

Ans 3b.
Introduction:
After planning, the corporation's position is the subsequent herbal step. Someone must labor and do the right
project to obtain the plan's targets. Human beings are motivated to work because of the organizing function.
"Managers are concerned in choices that result inside a machine of skilled coordinated jobs," in line with the
function. Many elements have a position in the structure of an organization. There may be both human and non-
human elements at work.
Organisation
Statergy
Concept and application:

Factors
Enviorment
Affecting Organisation
Organisational Size
Structure

Technology

The structure of the corporation is decided using the following variables:

 Organization Strategy: The strategies being adopted by a company can be of importance in developing
an organizational structure. If it is easy to change the organizational structure depending upon the
business strategy changes the company can attain higher growth. However, in such cases business
owners may feel unwilling as the overall control of the business might be lost. In the case of a Small
business organization, much delay is caused by forming an organizational structure change. Some
companies might be interested in creating and implementing different business strategies without
making any changes in organizational structure

 Size or Structure: Larger organizations have more complicated structures. Size indicates the scale of
operation. Normally there are three scales of operation, viz., small, medium and large. Size is an
important factor governing cost, efficiency and profitability of a business enterprise. Before any
business or non-business enterprise is started, the organizers will have to decide the most profitable and
viable size of the unit. Optimum or the best size is a dynamic concept and it changes with the
development of science and technology. Organizational influences on job design lead to more
specialized tasks. Work procedures are more detailed with rules and guidelines.
  Technology: Technology affects organizational design by enhancing the methods of communication.
An example is the growth of the "virtual organization." No longer is it necessary for employees to be on
site or physically located at a central office. Managers have the ability to communicate more quickly and
effectively with email, shared calendars and online conferences and presentations. Organizational
structures are dynamic. The method that worked in the past will not necessarily work for the future. The
business grows, markets change, prices fluctuate and competition gets tougher. All of these factors mean
that the organization must adapt to meet these challenges and find the best methods to utilize employees'
skills.

 Environment: In a dynamic environment, the customers' desires are continuously changing the opposite
of a stable environment. This condition is often thought of as turbulent. In addition, the technology that a
company uses while in this environment may need to be continuously improved and updated. An
example of an industry functioning in a dynamic environment is electronics. Technology changes create
competitive pressures for all electronics industries, because as technology changes, so do the desires of
consumers. One of the factors affecting organizational design for international business is geography. In
this case, employees are spread across the globe and operate in environments with different business
cultures and ethics. The organizational structure has to accommodate these differences.

Conclusion:

In an organization structure so many aspects are involved. Human and non-human elements will be working.
Organizational structure is an integrated whole. Job of each worker is specified, control measures are adopted
for performing those jobs effectively. An organizational chart depicts tangibly the reporting relationships and
channels of communication. Work flow and accountability are also shown. What factors actually determine the
organization structure? It is grouping activity of men, machine and material for attaining a specific objective

The specialized job designs will have narrow spans, homogenous departments, little control, little authority and
small structure will be designed. Job designs with less or no specialization will have heterogeneous
departments, more spans of management, more delegation of authority and forms a complex organization
structure. Although these are the factors which decide the organization structure, research and experience have
shown that performance, attitudes, satisfaction and other factors also influence the structure.