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MB0022 3 credits

Registration No.: 520911739

January 07, 2010 MB0022 Set-2

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Q (1) Discuss Henri Fayol’s administrative theory (14 principles of Management) Answer:

1. to forecast and plan - prevoyance examine the future and draw up plans of action 2. to organise build up the structure, material and human of the undertaking 3. to command maintain activity among the personnel 4. to co-ordinate bind together, unify and harmonize activity and effort 5. to control see that everything occurs in conformity with policy and practise

Fayol also synthesised 14 principles for organisational design and effective administration. It is worthwhile reflecting on these are comparing the conclusions to contemporary utterances by Peters, Kanter and Handy to name but three management gurus. Fayol's 14 principles are:

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specialisation/division of labour A principle of work allocation and specialisation in order to concentrate activities to enable specialisation of skills and understandings, more work focus and efficiency. authority with corresponding responsibility If responsibilities are allocated then the post holder needs the requisite authority to carry these out including the right to require others in the area of responsibility to undertake duties. Authority stems from: o that ascribed from the delegation process (the job holder is assigned to act as the agent of the high authority to whom they report - hierarchy) MB0022 Set-2

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allocation and permission to use the necessary resources needed (budgets, assets, staff) to carry out the responsibilities. selection - the person has the expertise to carry out the responsibilities and the personal qualities to win the support and confidence of others.

The R = A correspondence is important to understand. R = A enables accountability in the delegation process. Who do we cope with situations where R > A? Are there work situations where our R< A? "judgement demands high moral character, therefore, a good leader should possess and infuse into those around him courage to accept responsibility. The best safeguard against abuse of authority and weakness on the part of a higher manager is personal integrity and particularly high moral character of such a manager ..... this integrity, is conferred neither by election nor ownership. " 1916 A manager should never be given authority without responsibility--and also should never be given responsibility without the associated authority to get the work done. •

discipline The generalization about discipline is that discipline is essential for the smooth running of a business and without it - standards, consistency of action, adherence to rules and values - no enterprise could prosper.

"in an essence - obedience, application, energy, behaviour and outward marks of respect observed in accordance with standing agreements between firms and its employees " 1916 •

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Unity of command The idea is that an employee should receive instructions from one superior only. This generalization still holds - even where we are involved with team and matrix structures which involve reporting to more than one boss - or being accountable to several clients. The basic concern is that tensions and dilemmas arise where we report to two or more bosses. One boss may want X, the other Y and the subordinate is caught between the devil and the deep blue sea. Unity of direction The unity of command idea of having one head (chief executive, cabinet consensus) with agree purposes and objectives and one plan for a group of activities) is clear. Subordination of individual interest to the general interest Fayol's line was that one employee's interests or those of one group should not prevail over the organisation as a whole. This would spark a lively debate about who decides that the interests of the organisation as a whole are. Ethical dilemmas and matters of corporate risk and the behaviour of individual "chancers" are involved here. Fayol's work - assumes a shared set of values by people in the organisation - a unitarism where the reasons for organisational activities and decisions are in some way neutral and reasonable. Remuneration of staff

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“The price of services rendered.” 1916 The general principle is that levels of compensation should be "fair" and as far as possible afford satisfaction both to the staff and the firm (in terms of its cost structures and desire for profitability/surplus). •

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centralisation Centralisation for HF is essential to the organisation and a natural consequence of organising. This issue does not go away even where flatter, devolved organisations occur. Decentralisation - is frequently centralisaeddecentralisation !!! The modes of control over the actions and results of devolved organisations are still matters requiring considerable attention. scalar chain/line of authority The scalar chain of command of reporting relationships from top executive to the ordinary shop operative or driver needs to be sensible, clear and understood. order The level of generalisation becomes difficult with this principle. Basically an organisation "should" provide an orderly place for each individual member - who needs to see how their role fits into the organisation and be confident, able to predict the organisations behaviour towards them. Thus policies, rules, instructions and actions should be understandable and understood. Orderliness implies steady evolutionary movement rather than wild, anxiety provoking, unpredictable movement. equity Equity, fairness and a sense of justice "should"pervade the organisation - in principle and practice. stability of tenure Time is needed for the employee to adapt to his/her work and perform it effectively. Stability of tenure promotes loyalty to the organisation, its purposes and values. initiative At all levels of the organisational structure, zeal, enthusiasm and energy are enabled by people having the scope for personal initiative. (Note: Tom Peters recommendations in respect of employee empowerment) esprit de corps Here Fayol emphasises the need for building and maintaining of harmony among the work force , team work and sound interpersonal relationships.

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Q (2) Explain shaping behavior and different methods of shaping behavior. Answer:

Methods of Shaping Behavior: Extinction: According to operating conditioning, both good and bad behaviors are controlled by reinforced consequences. Identifying behavioral reinforces and removing them can decrease a behavior. An undesired behavior without reinforcement can diminish until it no longer occurs. This process is called extinction. Extinction can modify the behavior of a worker who spends much time talking or telling jokes. The attention of coworkers reinforces this behavior. If coworkers stop talking and laughing, the worker is likely to stop telling jokes. Although extinction is useful, it takes time to eliminate the undesired behavior. When behaviors need to stop immediately, managers may resort to punishment. Punishment: Punishment consists of administering a negative consequence when the undesired behavior occurs. Punishment is not the same as negative reinforcement. It decreases a behavior, whereas negative reinforcement increases the frequency of a behavior. Punishment administers a negative consequence, whereas negative reinforcement removes a negative consequence. Reinforcement: Reinforcement is the process that increases the probability that desired behaviors occur by applying consequences. Managers use reinforcement to increase the likelihood of higher sales, better attendance, or observing safety procedures. Reinforcement begins by selecting a behavior to be encouraged. Correctly identifying the behavior is important, or reinforcement will not lead to the desired response. A manager must decide if attendance at meetings is the desired behavior or attendance and participation. The manager would need to reinforce both behaviors if both are desired.

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Q (3) Write a detailed note on MBIT and big five model. Answer: The Myers-Briggs Types Indicator The MBTI classifies human beings into four opposite pairs (dichotomies), base on their psychological opposites. These four opposite pairs result into 16 possible combinations. In MBTI, individuals are classified as (McCrae and Costa, 1989): a) b) c) d)

Extroverted or introverted (E or I) Sensing or intuitive (S or N) Thinking or feeling (T or F) Perceiving or judging (P or J)  These classifications are then combined into sixteen personality types. For example: a. INTJs are visionaries. They usually have original minds and great drive for their own ideas and purposes. They are characterized as skeptical, critical, independent, determined, and often stubborn. b. ESTJs are organizers. They are realistic, logical, analytical, decisive, and have a natural head for business or mechanics. They like to organize and run activities. c. The ENTP type is a conceptualizer. He or she is innovative, individualistic, versatile, and attracted to entrepreneurial ideas. This person tends to be resourceful in solving challenging problems but may neglect routine assignments.

The big five model 1. Many researchers argue that five basic dimensions underlie all other personality dimensions (e.g. McCrae and Costa, 1990; Dugnabm 1997). The five basic dimensions are: a. Extraversion: Comfort level with relationships. Extraverts tend to be gregarious, assertive, and sociable. Introverts tend to be reserved, timid, and quiet.

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-7b. Agreeableness: Individual’s propensity to defer to others. High agreeableness people – cooperative, warm and trusting. Low agreeableness people – cold, disagreeable, and antagonistic. c. Conscientiousness: A measure of reliability. A high conscientious person is responsible, organized, dependable, and persistent. Those who score low on this dimension are easily distracted, disorganized, and unreliable. d. Emotional stability: A person’s ability to withstand stress. People with positive emotional stability tend to be calm, self-confident, and secure. Those with high negative scores tend to be nervous, anxious, depressed, and insecure. e. Openness to experience: The range of interests and fascination with novelty. Extremely open people are creative, curious, and artistically sensitive. Those at the other end of the openness category are conventional and find comfort in the familiar. Research suggested important relationships between these personality dimensions and job performance (Barrick, & Mount, 1991). For example, conscientiousness predicted job performance for all occupational groups. Individuals who are dependable, reliable, careful, thorough, able to plan, organized, hardworking, persistent, and achievementoriented tend to have higher job performance. Employees higher in conscientiousness develop higher levels of job knowledge. For the other personality dimensions, predictability depended upon both the performance criterion and the occupational group. Extraversion predicted performance in managerial and sales positions. Openness to experience is important in predicting training proficiency.

Q (4) Explain the stepwise procedure of Rational Decision Making Model Answer: The Decision-Making Process The optimizing decision maker is rational. He or she makes consistent, valuemaximizing choices within specified constraints. This also includes the resource crunch and other limitations as well. The rational decision making model This model proposes six steps, which are as follows: Step 1: Defining the problem

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A problem is a discrepancy between an existing and a desired state of affairs. Many poor decisions can be traced to the decision-maker overlooking a problem or defining the wrong problem.

Step 2: Identify the decision criteria important to solving the problem. • •

The decision maker determines what is relevant in making the decision. Any factors not identified in this step are considered irrelevant to decision maker. This brings in the decision maker’s interests, values, and similar personal preferences.

Step 3: Weight the previously identified criteria in order to give them the correct priority in the decision

Step 4: Generate possible alternatives that could succeed in resolving the problem.

Step 5: Rating each alternative on each criterion. • •

Critically analyze and evaluate each alternative. The strengths and weaknesses of each alternative become evident as they are compared with the criteria and weights established in the second and third steps.

Step 6: The final step is to compute the optimal decision: •

Evaluating each alternative against the weighted criteria and selecting the alternative with the highest total score.

The above-mentioned model works with following assumptions (March, 1994): • • •

Problem clarity. The decision maker is assumed to have complete information regarding the decision situation. Known options. It is assumed the decision maker is aware of all the possible consequences of each alternative. Clear preferences. Criteria and alternatives can be ranked and weighted to reflect their importance.

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Constant preference. Specific decision criteria are constant and the weights assigned to them are stable over time. No time or cost constraints. The rational decision maker can obtain full information about criteria and alternatives because it is assumed that there are no time or cost constraints. Maximum payoff. The rational decision maker will choose the alternative that yields the highest perceived value.

Creativity in Decision Making Creativity in the ability novel and useful ideas. These are ideas that are not only different from what has been done before, but, that are also appropriate to the problem or opportunity presented. People differ in their inherent creativity. A study of lifetime creativity of 461 men and women found that fewer than one percent were exceptionally creative. Ten percent were highly creative, and about sixty percent were somewhat creative. Model of Creativity This model proposes that individual creativity essentially requires expertise, creativethinking skills, and intrinsic task motivation. • • •

Expertise is the foundation for all creative work. The potential for creativity is enhanced when individuals have abilities, knowledge, proficiencies, and similar expertise in their field of endeavor. Creative thinking skills. This encompasses personality characteristics associated with creativity, the ability to use analogies, as well as the talent to see the familiar in a different light. Intrinsic task motivation. The desire to work on something because it is interesting, involving, exciting, satisfying, or personally challenging. This turns creativity potential into actual creative ideas. It determines the extent to which individuals fully engage their expertise and creative skills

Q (5) Elaborate Group Structure Answer: Group Structure: Work groups in order to function as a coordinated unit need to have a proper structure where there must be certain elements like formal leadership, role clarity among group

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- 10 members. In the absence of these factors groups not only become conflict ridden, but also suffer from confusion, and function on a sub optimal level. Each element is explained briefly below: 1. Formal Leadership: Almost every work group must have a formal leader, which is typically identified by a title. The leader can play an important part in the group’s success. 2. Roles: All group members are actors, where each is playing a role. While some of these roles may be compatible other creates conflicts. Different groups impose different role requirements on individuals. 3. Role perception: For playing one’s role effectively in a group, one’s view of how one is supposed to act in a give situation must be clear leading to clear role perception. By watching and imitating senior members of a group the new comers learn how to take on their roles effectively and also learn how to play them well. 4. Role expectations: Tuning oneself and behaving in a socially desirable manner is a part of fulfilling role expectations in a given situation in the context of achieving group goals and organizational goals. 5. Role conflict: When a group member is faced with the challenge of playing multiple roles, role conflict may occur due to inability of the individual to balance all the roles effectively, thereby reducing role effectiveness, hampering the group and organizational goal attainment process.

Q (6) Write down different steps of Conflict Management. Answer: The process of conflict management has the following steps (Schermerhorn el al, 2002): Stage 1: Potential Opposition or Incompatibility MB0022 Set-2

- 11 This stage concludes the conditions that create opportunities for conflict to arise. The conditions are as follows: 1. Communication - Communication becomes as source of conflict due to semantic difficulties, misunderstandings, and “noise” (distortion) in the communication channels. Differing word connotation, jargon, insufficient exchange of information, and noise in the communication channel are all barriers to communication and potential antecedents to conflict. 2. Structure – The term structure includes variables such as size, degree of specialization, jurisdictional clarity, member-goal compatibility, leadership styles, reward systems, and the degree of dependence. Size and specialization act as forces to stimulate conflict. The lager the group and more specialized its activities, the greater the likelihood of conflict. The larger the group and more specialized its activities, the greater the likelihood of conflict. The potential for conflict is greatest where group members are younger and turnover is high. The greater the ambiguity is responsibility for actions lies, the greater potential for conflict. 3. Personal Variables – Personal variables include individual value systems and personality characteristics. Certain personality types lead to potential conflict. Value differences are the best explanation for difference of opinion on various matters.

Stage II: Cognition and Personalization Antecedent conditions lead to conflict only when the parties are affected by and aware of it. Conflict is personalized when it is felt and when individuals become emotionally involved. Emotions play a major role in shaping perception. Negative emotions produce oversimplification of issues, reductions in trust, and negative interpretations of the other party’s behavior. Positive feelings increase the tendency to see potential relationships among the elements of a problem, to take a broader view of the situation, and to develop more innovative solutions (Robbins, 2003).

Stage III: Intentions The primary conflict-handling intentions are represented as follows: • • •

Cooperativeness - “the degree to which one party attempts to satisfy the other party’s concerns.” Assertiveness – “the degree to which one party attempts to satisfy his or her own concerns.” Competing – When one persona seeks to satisfy his or her own interests, regardless of the impact on the other parties to the conflict.

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Collaborating – When the parties to conflict each desire to fully satisfy the concerns of all parties. The intention is to solve the problem by clarifying differences rather than by accommodating. Avoiding – A person may recognize that a conflict exists and want to withdraw from it or suppress it. Accommodating – When one party seeks to appease an opponent, that party is willing to be self-sacrificing. Compromising – When each party to the conflict seeks to give up something, sharing occurs, resulting in a compromised outcome. There is no clear winner or loser, and the solution provides incomplete satisfaction of both parties’ concerns.

Stage IV: Behavior The behavior stage includes the statements, actions, and reactions made by the conflicting parties. These conflict behaviors are usually overt attempts to implement each party’s intentions. It is a dynamic process of interaction with a continuum. At the lower part of the continuum, conflicts are characterized by subtle, indirect, and highly controlled forms of tension. Conflict intensities escalate as they move upward along the continuum until they become highly destructive. Functional conflicts are typically confined to the lower range of the continuum.

Stage V: Outcomes Outcomes may be functional – improving group performance, or dysfunctional in hindering it. Conflict is constructive when it (Robins, 2003): a. b. c. d. e.

Improves the quality of decisions. Stimulates creativity and innovation. Encourages interest and curiosity. Provides the medium through which problems can be aired and tensions released. Fosters and environment of self-evaluation and change.

Outcomes may be dysfunctional as well. They are as follows: Uncontrolled opposition breeds discontent, which acts to dissolve common ties and eventually leads to the destruction of the group. Undesirable consequences include a retarding of communication, reductions in group cohesiveness, subordination of group goals to the primacy of infighting between members. Conflict can bring group functioning to a halt and potentially threaten the group’s survival. The demise of an organization as a result of too much conflict is not as unusual as it might first appear. MB0022 Set-2

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