Answer Homework no.

MGT101/201

Student name

Joud Ali alarbash

ID

22304218
Answer Q1

Ziad Al-Ghamdi's decision to hire 12 new employees during the 2008 economic
recession could be considered in violation of the principles of economic environment
and financial planning. Here's why:

• Economic Environment: Recessions are characterized by decreased economic

activity, including decreased demand for goods and services. Hiring new
employees during this period increases the company's costs without a
guaranteed return on investment.
• Planning Financial Goals: One of the main financial goals during a recession
is to cut costs. Hiring new employees conflicts with this goal and may
jeopardize the financial stability of the company.
• Therefore, the appropriate action during recessions is to freeze or even reduce
hiring. Exceptions may be made for critical positions that are essential to
maintaining operations or if there is a clear plan to use new employees to
generate revenue even in an economic downturn.

Answer Q2
The contemporary view that chains of command, chains of authority, and unity of
command are less important in today's organizations stems from several factors:

1. Increased complexity and dynamism: Modern organizations operate in

complex and dynamic environments, requiring greater flexibility and
adaptability. Strict hierarchies can hinder communication and decision-
making.

1
 2. Empowerment and knowledge sharing: Decentralized structures empower
employees at all levels, leading to increased engagement and innovation.
Knowledge sharing and collaboration are encouraged, breaking down
traditional silos.
3. Focus on teamwork and cross-functionality: Project-based work and cross-
functional teams are becoming more common, requiring collaboration across
departments and levels. Strict hierarchies can hinder this collaboration.

Examples:

Flat hierarchies in technology startups enable rapid decision-making and

adaptation.

Cross-functional teams in product development combine expertise from

different departments.

Matrix structures allow employees to report to multiple managers depending

on the project.

Answer Q3
The efficiency of an organization depends on many factors, and span of control is
only one piece of the puzzle. While a smaller span of control allows for close
supervision and possibly better performance, it can also lead to increased bureaucracy
and communication bottlenecks.

My opinion: I believe that the optimal scope of control depends on the specific
organization and its context. Factors such as the complexity of the work, the skill
level of employees, and the capabilities of the manager should be considered. A
flexible approach that adjusts the span of control based on the situation is often most
effective.

2
Answer Q4
Organizations move away from strict rules and standardization for several reasons:

• Increase employee autonomy and participation: Today's employees value

independence and want to participate in decision-making. Strict rules can
stifle creativity and initiative.
• Focus on innovation and adaptability: In today's fast-paced environment,
organizations need to be able to quickly adapt to changing conditions. Strict
rules can hinder this agility.
• Workforce diversity and work styles: A diverse workforce requires flexibility
in how employees work and are managed. One-size-fits-all rules may not be
effective for everyone.

Answer Q5
XYZ should follow the product breakdown structure. This means that each branch
will be responsible for a specific product line (e.g. new cars, used cars, service).

Figure-1:

• Sales Director Dubai: Responsible for all sales activities related to new cars in
Dubai.
• Sales Director Riyadh: Responsible for all sales activities related to used cars
in Riyadh.
• Sales Director Bahrain: Responsible for all sales activities related to service in
Bahrain.

Answer Q6

3
 Najeeb Company should consider creating a functional management structure based
on the contingency factor of uncertainty in the business environment. In this structure,
departments are organized based on the functions they perform (such as purchasing,
production, and quality control). This allows for specialization and expertise in raw
material handling and waste control.

Answer Q7
Abdul Aziz Restaurant Group should adopt a divisional structure with decentralized
decision-making process. This means that each branch will operate as a separate unit
with its own manager responsible for making decisions regarding operations,
marketing and recruitment. Abdulaziz can implement a participatory decision-
making process where branch managers consult with their teams and provide input
before making decisions. This empowers employees and enhances a sense of
ownership.

Remember that these are just general guidelines, and that the best approach for each
organization will depend on its specific context and needs.

4
Answer Section B: Optional questions (answer a minimum
of 3)

Answer Q8
As a supply chain manager importing materials from Brazil, there are several
external factors that can affect on-time delivery:

• Political and economic instability: Political unrest, economic sanctions, or

currency fluctuations can disrupt transportation and logistics.
• Natural Disasters: Hurricanes, floods, or other natural disasters can damage
infrastructure or cause port closures.
• Trade regulations and customs delays: Changes in trade regulations or
bureaucratic inefficiency at customs can cause delays.
• Transportation Issues: Strikes, port congestion, or equipment shortages can
affect shipping schedules and times.
• Supplier Performance: Delays or quality issues at your Brazilian supplier can
impact your production schedule.
• Infrastructure: Insufficient transportation infrastructure in Brazil can lead to
delays and logistical challenges.
• Currency Fluctuations: Sudden changes in exchange rates can affect import
costs and profitability.

Answer Q9
Establishing a ready-made clothing business in Jubail requires studying several
demographic factors to make decisions regarding your product:

5
 1. Age and Gender: Understanding the prevailing age groups and gender
demographics in Jubail will help you target your product range.
2. Income Level: Knowing your average disposable income and spending
patterns will guide your pricing strategy and product quality.
3. Cultural Preferences: Local fashion trends, religious considerations, and
cultural dress codes will influence your designs and styles.
4. Lifestyle and Activities: Analyzing popular activities and lifestyles in Jubail
can help you meet specific needs, such as sportswear or professional clothing.
5. Population Growth and Trends: Understanding future population growth and
demographic shifts can forecast future market demands.

Answer Q10

• Socio-cultural factors include the social norms, values and customs of a

society. It can significantly impact a manager's decision-making process in
several ways:
• Consumer Preferences: Social and cultural factors influence what people buy,
wear, and value. Managers need to understand these preferences to develop
products and services that resonate with customers.
• Communication and negotiation styles: Cultural differences can affect
communication styles and negotiation tactics. Managers need to adapt their
approach to achieve successful results in different cultural contexts.
• Motivating and Managing Employees: Social and cultural factors influence
employee values, work ethics, and expectations. Managers need to adjust their
leadership style and incentive systems accordingly.

6
• Example: A multinational company launching a product in a new country may
need to adjust its marketing campaign to reflect local cultural sensitivities or
adapt its product features to suit local needs.