ESSENTIALS OF MANAGEMENT

Q1.A Ans: There were three factors that were chosen to outline the success of McDonalds corporation. The first factor is globalization, which is define as closer contact between different parts of the world, with increasing possibilities of personal exchange, mutual understanding and friendship between "world citizens". Diversity, the difference among people and cultures, is the second factor discussed in the paper. The final factor is ethics, which can be defined as a set of principles of right conduct. This paper explains how the McDonald Corporations uses the factors to conduct business around the world. In todays society, corporations and enterprises are expanding their businesses in the global markets. Globalization is necessary for success and survival in the worldwide market; however, global competition is not easy (Bateman & Scott, 2004). By the end of the twentieth century, the list of Fortune 500 companies was no longer only United States corporations due to an increase in international companies joining the list (Global Capitalism, 2005). As a leading food service retailer, McDonalds joins those corporations with restaurants in 119 countries (McDonalds, 2004). Important strategic decisions are a key factor to their success with consideration for both internal and external factors. When considering the foreign market, companies need to consider there are risks. There must be local marketing to appeal to the local consumers and also to build relationships and trust (Bateman & Scott, 2004). Therefore, the strategic planning for marketing has to be effective. McDonalds caters its menu in other countries to the cultures of the regions. For example, in India, the nonvegetarian menu includes chicken and fish items only (Welcome, n.d.). Beef is not on the menu in India because are considered sacred. Global marketing decisions are no different than those made domestically but the decisions are unique to each country (Sister & Sister, 2005). Furthermore, operating on a global scale allows a companys employees to experience working in different cultural environments. This is a good marketing strategy for recruiting employees. McDonalds has a global core curriculum for its restaurant management (McDonalds, 2004). Paula Doherty, a general manager states, Ive had incredible experience in different countries andculturesas a trainee manager from Poland to Israel to the Philippines and more. Doing the job successfully has given me a real sense of achievement

Q1.B Ans: Opportunities 1) "Going green" - energy management, improving packaging efficiency, environmentally friendly refrigerants, and partnering with Greenpeace for rainforest protection Charity - The Ronald McDonald House provides a cheap or free place to stay for parents of sick children. Over 250 worldwide in 48 countries.2) New store looks/styles - McCafe coffee shop, and "forever young" redesign 3) McDonald's has f maintained an extensive advertising campaign for decades. For popularity they use media (television, radio, and newspaper), the company makes significant use of billboards and signage, sponsors sporting events from ranging from Little League to the Olympic Games, and makes coolers of orange drink with their logo available for local events of all kinds. Television has always played a central role in the company's advertising strategy. They always advertise McDonalds much different way to their customers. Until now, McDonald's has used 23 different slogans in United States for advertising, and few others slogans for select countries and regions. 4) Recently McDonald's is actively trying to reduce their negative impact on the environment by altering their company policies. Their policy now an outline is not only the individual restaurants' behaviors, but also the ways in which they go about using their resources and acquiring them-. Since the 1990's, McDonald's restaurants have been encouraged to participate in the environmentally friendly movement by getting involved in community clean up days to cut down on the amount of litter around their stores. They have made an effort, assisted by Environmental Defense, to utilize recycling both in packaging their products and in what they use day to day which has allowed them to cut down on their waste significantly. McDonald's continues to be environmentally conscious in their business and they are currently testing a restaurant that will potentially give off less harmful pollutants by using alternatives to harmful refrigerants Criticism - contribute to obesity, and other health problems Many competitors for same costumer - Subway - Burger King - KFC - Taco Bell 5) They have the ability to add healthier lines of food. They have already gotten rid of super sizing and I think they have made their fries healthier currently. There is another personify is The Golden Arches are now more widely recognized than the Christian cross. McDonald's operates more playgrounds - designed to attract children (and their parents) to its restaurants - than any other private entity in the US. Threats

McDonald's faces up to European fears over food and job quality LONDON McDonald's is set to admit that it has not done enough to reassure the European market on issues about the nutritional value of its food and the quality of jobs it provides, in a corporate responsibility report to be published next week. According to a report in the Financial Times, the report will admit that McDonald's has learned that "we could do better in our understanding of wider social trends and expectations". It says that the report will quote negative and positive comments given to it in a year of interviews, including accusations that McDonald's "does not value its employees" and that "working at McDonald's doesn't look like much fun". It rejects the claims, and has been working to dispel the McJob tag with which it is saddled. Burger giant faces court threat over bad language idea Fast-food giant McDonald's could be in trouble with race watchdogs for asking its staff to speak English.An outlet in Manchester put up a sign ordering employees to use English at all times in the store - including in the staffroom. But experts now believe the burger giant could have infringed workers' human rights and European employment law. HOW DID McDonalds HANDLE THEM? Mcdonalds handle these threats by these possible steps. By decreasing health problem. By delivering superior value to customers then competitors. For better performance in Europe McDonalds has to do a lot of work by providing the taste and dishes which have high demand in europen market. McDonalds should increase advertisement in Europe. McDonalds should distribute free sample in different offices and colleges. McDonalds have to provide the job that person which can attract more customers through his strategies. McDonalds should make planning to avoid from bird flu and other diseases in future. McDonalds can do better performance than his competitors by providing dishes which are a part of that culture. McDonalds should launch some new dishes according to condition. McDonalds should provide traditional dishes. WHAT ALTERNATIVE COULD IT HAVE CHOSEN? McDonalds can use following alternative to increase his value: McDonalds should stop his product where it's not doing well and take corrective action and check his quality.

 McDonalds should open new restaurant in that area where fast food has important part in the culture of that area. McDonalds has to choose that management which can easily understand the demand of all customers. McDonalds should decrease its prices in that country where per capita is very low. Mcdonalds should make his manuals which include traditional dishes of that area. McDonalds should it think at the level of middle customer rather than the high level customer. McDonalds should provide bonus to his employees for better performance. Q2.A Ans: We know we are living in a global age. Technology has brought the world much closer together. This means that people of different cultures find themselves working together and communicating more and more. This is exciting and interesting, but it can also be frustrating and fraught with uncertainty. How do you relate to someone of another culture? What do you say, or not say, to start a conversation off right? Are there cultural taboos you need to be aware of? Building connections with people from around the world is just one dimension of cultural diversity. You also have issues like motivating people, structuring projects, and developing strategy. The Five Dimensions of Culture Armed with a large database of cultural statistics, Hofstede analyzed the results and found clear patterns of similarity and difference amid the responses along these five dimensions. Interestingly, his research was done on employees of IBM only, which allowed him to attribute the patterns to national differences in culture, largely eliminating the problem of differences in company culture. The five dimensions are: 1. Power/Distance (PD) This refers to the degree of inequality that exists and is accepted among people with and without power. A high PD score indicates that society accepts an unequal distribution of power and people understand "their place" in the system. Low PD means that power is shared and well dispersed. It also means that society members view themselves as equals. Application: According to Hofstede's model, in a high PD country like Malaysia (104), you would probably send reports only to top management and have closed door meetings where only a select few, powerful leaders were in attendance. 2. Individualism (IDV) This refers to the strength of the ties people have to others within the community. A high IDV score indicates a loose

connection with people. In countries with a high IDV score there is a lack of interpersonal connection and little sharing of responsibility, beyond family and perhaps a few close friends. A society with a low IDV score would have strong group cohesion, and there would be a large amount of loyalty and respect for members of the group. The group itself is also larger and people take more responsibility for each other's well being. Application: Hofstede's analysis suggests that in the Central American countries of Panama and Guatemala where the IDV scores are very low (11 and 6, respectively), a marketing campaign that emphasized benefits to the community or that tied into a popular political movement would likely be understood and well-received. 3. Masculinity (MAS) This refers to how much a society sticks with, and values, traditional male and female roles. High MAS scores are found in countries where men are expected to be tough, to be the provider, to be assertive and to be strong. If women work outside the home, they have separate professions from men. Low MAS scores do not reverse the gender roles. In a low MAS society, the roles are simply blurred. You see women and men working together equally across many professions. Men are allowed to be sensitive and women can work hard for professional success. Application: Japan is highly masculine with a score of 95 whereas Sweden has the lowest measured value (5). According to Hofstede's analysis, if you were to open an office in Japan, you might have greater success if you appointed a male employee to lead the team and had a strong male contingent on the team. In Sweden, on the other hand, you would aim for a team that was balanced in terms of skill rather than gender. 4. Uncertainty/Avoidance Index (UAI) This relates to the degree of anxiety society members feel when in uncertain or unknown situations. High UAI-scoring nations try to avoid ambiguous situations whenever possible. They are governed by rules and order and they seek a collective "truth". Low UAI scores indicate the society enjoys novel events and values differences. There are very few rules and people are encouraged to discover their own truth. Application: Hofstede's Cultural Dimensions imply that when discussing a project with people in Belgium, whose country scored a 94 on the UAI scale, you should investigate the various options and then present a limited number of choices, but have very detailed information available on your contingency and risk plans. 5. Long Term Orientation (LTO) This refers to how much society values long-standing as opposed to short term traditions and values. This is the fifth dimension that Hofstede added in the 1990s after finding that Asian countries with a strong link to Confucian philosophy acted differently from western cultures. In countries with a high LTO score, delivering on social obligations and avoiding "loss of face" are considered very important. Application: According to Hofstede's analysis, people in the United States and United Kingdom have low LTO scores. This suggests that you can pretty

much expect anything in this culture in terms of creative expression and novel ideas. The model implies that people in the US and UK don't value tradition as much as many others, and are therefore likely to be willing to help you execute the most innovative plans as long as they get to participate fully. Q.2B Ans: Following are further descriptions of the distinctive aspects of each of the 15 cultural groups videotaped. Certainly, conclusions of statistical significant differences between individual cultures cannot be drawn without larger sample sizes. But, the suggested cultural differences are worthwhile to consider briefly. Japan. Consistent with most descriptions of Japanese negotiation behavior, the results of this analysis suggest their style of interaction is among the least aggressive (or most polite). Threats, commands, and warnings appear to be de-emphasized in favor of the more positive promises, recommendations, and commitments. Particularly indicative of their polite conversational style was their infrequent use of no and you and facial gazing, as well as more frequent silent periods. Korea. Perhaps one of the more interesting aspects of the analysis is the contrast of the Asian styles of negotiations. Non-Asians often generalize about the Orient; the findings demonstrate, however, that this is a mistake. Korean negotiators used considerably more punishments and commands than did the Japanese. Koreans used the word no and interrupted more than three times as frequently as the Japanese. Moreover, no silent periods occurred between Korean negotiators. Germany. The behaviors of the Germans are difficult to characterize because they fell toward the center of almost all the continua. However, the Germans were exceptional in the high percentage of self-disclosures (47 percent) and the low percentage of questions (11 percent). France. The style of the French negotiators was perhaps the most aggressive of all the groups. In particular, they used the highest percentage of threats and warnings (together, 8 percent). They also used interruptions, facial gazing, and no and you very frequently compared with the other

groups, and one of the French negotiators touched his partner on the arm during the simulation. These differences across the cultures are quite complex, and this material by itself should not be used to predict the behaviors of foreign counterparts. Instead, great care should be taken with respect to the aforementioned dangers of stereotypes. The key here is to be aware of these kinds of differences so that the Japanese silence or the French threats are not misinterpreted. Q3.A Ans: Decision making is defined as the selection of a course of action from among alternatives; it is at the core of planning. A plan cannot be said to exist unless a decision -a commitment of resources, direction or reputation has been made. Managers see decision making as their central job because they must constantly choose what is to be done, who is to do it, and when, where, and occasionally even how it will be done. The decision process is actually the core of planning. The process is as follows: Premising Identifying alternatives evaluating alternatives in terms of the goal sought choosing an alternative which is making a decision Managers acting or deciding rationally are attempting to reach some goal that cannot be attained without action. They must have a clear understanding of alternative courses by which a goal can be reached under existing circumstances and limitations. They also must have the information and the ability to analyze and evaluate alternatives with regard to the goal sought. A manager must settle for limited rationality or "bounded" rationality. In other words, limitations of information, time and certainly rationality even though a manager try earnestly to be completely rational. Since managers cannot be completely rational in practice, they sometimes allow their dislike of rise of risk - their desire to "play it safe" -to interfere with the desire to reach the best solution under the circumstances. This is also known as "satisfying" which means picking a course of action that is satisfactory or good enough under the circumstances. Because there are almost always alternatives - usually many - to a course of action, managers need to narrow them down to those few that deal with the limiting factors. These are the factors that stand in the way of achieving a

desired objective. Alternatives are then evaluated in terms of quantitative and qualities factors. Other techniques for evaluating alternatives include marginal analysis and cost effectiveness analysis. Experience, experimentation and research and analysis come into play in selecting an alternative. Programmed and non programmed decisions are different. The former are suited for structured or routine problems. These kinds of decisions are usually made by lower level managers on -non managers. Non programmed decisions are used for unstructured and non routine problems and are made by upper level managers Managers play a very important role in decision making because their decisions impact the success of their organizations. But Managers should be able to determine and weigh the risks involved in pursuing unusual ideas and translating them into innovative practices. Creativity, the ability and power to develop new ideas, is important for effective managing. Q3.B Ans: Formal organization is the intentional structure of roles in a formally organized enterprise. This does not mean there is anything inherently inflexible about it. If a manager is to organize well, the structure must furnish an environment in which individual performance, both present and future, contributes most effectively to group goals. A formal organization can also be conceived as a communication system where the flow of information is either from top down or bottom up through the correct channels. For e.g.: the illustration shows a formal organization where the flow of information is either from the President to the Vice President and to the Division Managers and finally to the Department Managers or vice versa which is from the Department managers to the Division Managers to the Vice President to the President Q4.A Ans: An organization has to make strategic and operational decisions. Where and by whom should these decisions be made? And: how should the organization structure be adapted? Centralization and Decentralization are two opposite ways to transfer decision-making power and to change the organizational structure of organizations accordingly. Centralization: Definition: The process of transferring and assigning decision-making authority to higher levels of an organizational hierarchy.

In a centralized organization, the decision-making has been moved to higher levels or tiers of the organization, such as a head office, or a corporate center. Knowledge, information and ideas are concentrated at the top, and decisions are cascaded down the organization. The span of control of top managers is relatively broad, and there are relatively many tiers in the organization. Compare: Fayol. Decentralization: Definition: The process of transferring and assigning decision-making authority to lower levels of an organizational hierarchy. In a decentralized organization, the decision-making has been moved to lower levels or tiers of the organization, such as divisions, branches, departments or subsidiaries. Knowledge, information and ideas are flowing from the bottom to the top of the organization. The span of control of top managers is relatively small, and there are relatively few tiers in the organization, because there is more autonomy in the lower ranks. Three Forms of decentralization Deconcentration. The weakest form of decentralization. Decision making authority is redistributed to lower or regional levels of the same central organization. Delegation. A more extensive form of decentralization. Through delegation the responsibility for decision-making are transferred to semiautonomous organizations not wholly controlled by the central organization, but ultimately accountable to it. Devolution. A third type of decentralization is devolution. The authority for decision-making is transferred completely to autonomous organizational units. Strengths of Centralization. Characteristics Philosophy / emphasis on: top-down control, leadership, vision, strategy. Decision-making: strong, authoritarian, visionary, charismatic. Organizational change: shaped by top, vision of leader. Execution: decisive, fast, coordinated. Able to respond quickly to major issues and changes.

Uniformity. Low risk of dissent or conflicts between parts of the organization. Strengths of Decentralization. Characteristics Philosophy / emphasis on: bottom-up, political, cultural and learning dynamics. Decision-making: democratic, participative, and detailed. Organizational change: emerging from interactions, organizational dynamics. Execution: evolutionary, emergent. Flexible to adapt to minor issues and changes. Participation, accountability. Low risk of not-invented-here behavior.

Q4.B Ans: Delegation is the process of giving decision-making authority to lowerlevel employees. For the process to be successful, a worker must be able to obtain the resources and cooperation needed for successful completion of the delegated task. Empowerment of the workforce and task delegation is closely intertwined. Empowerment occurs when upper-level employees share power with lower-level employees. This involves providing the training, tools and management support that employees need to accomplish a task. Thus, an enabled worker has both the authority and the capability to accomplish the work. Although authority can be delegated, responsibility cannot-the person who delegates a task is ultimately responsible for its success. The assigned worker is therefore accountable for meeting the goals and objectives of the task. Although delegation can provide benefits to the organization, many managers lack the motivation or knowledge to delegate effectively and thus delegation (or lack of delegation) may be detrimental to the company. Managers' lack of motivation to delegate may be associated with a number of fallacies associated with delegations. Many managers believe that "if you want it done right, you have to do it yourself." While this is at times untrue, because the ultimate responsibility for a task lies with the manager, this attitude often prevents delegation. Other reasons for a lack of

motivation to delegate are lack of trust in subordinates, fear of being seen as lazy, reluctance to take risks, and fear of competition from subordinates. Some of these barriers are correctable through management training and development, but others may not be easily overcome. Mangers may also lack the competencies necessary to delegate effectively. They may choose the wrong tasks to delegate, the wrong subordinate to trust, or they may provide inadequate direction to the subordinate when delegating. Improper delegation can cause a host of problems, primary of which is an incorrectly completed task, which may hurt the overall productivity of the organization. Additionally, the careers of the manager and subordinate may suffer. The manager is likely to take the blame for delegating the wrong task, delegating to the wrong person, or not providing proper guidance. The subordinate may also take the blame for doing the task incorrectly. Thus, poor delegation may detract from the personal success of managers and employees.

Q5.B Ans: Chances are pretty good that once Intel Chairman Craig Barrett formally retires in May, he'll head straight for Montana just as the snows are melting and the rivers are high. The avid fisherman, who served as Intel's fourth chief executive officer until three years ago, seems equally at ease discussing how to create some of the most complex structures known to man and the best way to tie a fly. The company announced Friday that Barrett will step down as chairman of the board of the world's largest chipmaker, three years after turning over the CEO post to current Intel head Paul Otellini. He leaves a mixed legacy behind: under his watch, Intel cemented its reputation as the world's leading chip-manufacturing organization. It operates a network of sophisticated "fabs" around the world that are the envy of the industry and of which Barrett, who is credited for perfecting Intel's approach to chip manufacturing in the 1970s and '80s, is immensely proud. But despite allocating billions of dollars toward R&D and acquisitions, Intel has failed to translate its dominant position atop the PC and server industries into a significant presence in any other market, such as consumer electronics or communications. That could give the company big problems as PCs and servers turn into slow-growing commodities, which is exactly the situation it sought to avoid in attempting to expand its reach.

Barrett leaves Intel at a time when the company is in as bad a shape as it has been in a long time, mostly thanks to the state of the worldwide economy. The last time things were this bad at Intel, however, was the time when Barrett made perhaps his most important contribution to the company as CEO. During the dot-com bust years, Intel was very worried about its chip manufacturing plants. Such plants, known as fabs in the industry, are ridiculously expensive to build and maintain, and therefore have to be run at very high capacity to generate a return. With PC demand falling faster than the Nasdaq, there was considerable sentiment both outside and inside Intel that the company should think about pulling back on plans to invest billions in new fabs and new manufacturing technologies. Barrett disagreed, and his was a very important vote. His decision to damn the torpedoes and plunge money in the manufacturing operation left Intel sitting pretty once PC demand recovered, with enough capacity and manufacturing expertise to ensure that PC makers would have to come to Intel for the majority of their chips. While Intel embarked on that strategy, however, it took its eye off its core business in a very important way. A day of reckoning would soon be upon its Netburst architecture, the soul of the Pentium 4 and Xeon processors that made Intel the vast majority of its money. Simply put, Netburst ran too hot. The architecture was designed to allow Intel to crank up the clock speed of its chips to new heights, which the company's marketing people believed was the only metric attached to processor performance that regular people understood. But the faster you run a chip, the more heat it produces. Intel once spoke of taking the Pentium 4 architecture to 10GHz, but concerns about power consumption and heat dissipation ensured the chip would top out under 4GHz. Faced with this reality, Intel was forced to throw together a multicore processing strategy to divide the workload across two cores that ran at slower speeds and consumed less power. Q6.A Ans: Motivation is a general term applying to the entire class of drives, desires, needs, wishes and similar forces. Human motives are based on needs, whether consciously or subconsciously felt. Some are primary needs, such as the physiological requirements for water, air, food, sleep and shelter. Other needs maybe regarded as secondary such as self esteem, status, affiliation with others, affection, giving, accomplishment and self assertion. These needs vary in intensity and over time among different individuals. Managers motivate their subordinates by doing those things which hope to satisfy the above mentioned drives and desires and induce the subordinates to act in a desired manner.

Managers should have an understanding of the roles assumed by people, the individuality of people and the personalities of people and strive to satisfy' the needs of the employee and also utilize his potential and also contribute to the organization. Some of the human factors in managing and motivating his subordinates are: Multiplicity of roles: The fact that an employee is more than just a productive factor in management's plans should be taken into consideration. They could be members of many social organizations like schools, churches, temples, trade associations, clubs, political parties etc. It is important to keep in mind that the managers and the people they lead are interacting members of a broad social system No Average person: People are different even if they have a specific role in the organization. It is important to acknowledge that people are essentially different and have different needs, attitudes, desires for responsibility, different levels of knowledge and skills and different potentials Managers should understand the complexity and individuality of people and should to make individual arrangements within the framework of the organizational rules and this does not exclude the possibility of arranging a job to the fir a person in a specific situation Importance of personal dignity: A manager should never violate the dignity of his subordinates. Each subordinate must be treated with respect no matter what their position is in the organization Consideration of the whole person: The human being is a total person influenced by external factors. A person has separate and distract characteristics such as knowledge, skills or personality traits and they cannot divest themselves of these forces when they come to work. A manager must recognize these facts and be prepared to deal with them. Money : can never be overlooked as a motivator whether given in the form of salary, bonus, incentive pay stock options, company paid insurance, money is important. Money can mean more then monetary value. It can also mean status or power. Participation: Use of participation is against. Motivational tool that can be used by managers. Only rarely are people not motivated by being consulted on action affecting them. Most people in the centre of operations have knowledge of both problems and of solutions. As a result, participation yields both motivation and knowledge valuable for enterprise success. Participation is also a means of recognition and appeals to the need for affiliation and acceptance. It gives people a sense of accomplishment Quality of working life: is a systems approach to job design and a promising development in the broad area of job enrichment. Managers have regarded it

as a promising means of dealing with stagnating productivity. Workers have also seen it as a means of improving working conditions and productivity and as a means of justifying higher pay. Effective managers must respond to the motivations of individuals if they are to design an environment in which people will perform willingly. Likewise they can design a climate that will arouse of reduce motivation. Q6.B Ans: Some of the guidelines to make committees effective are as follows: Authority': A committee's authority should be spelled out so that the members know whether their responsibility is to make decisions or recommendations or -merely deliberate and give the chairperson some insights into the issue under discussion. Size: of a committee is very important. The complexity of interrelationships greatly increases with the size of the group. If the group is too large, there may not be enough opportunities for adequate communication among its members. On the other hand if the group is too small, say 3 people. There is a possibility that two may form a coalition against the third member. As a general rule, a committee should be large enough to promote deliberation and include the breadth of expertise required for the job but not so large as to waste time or foster indecision. Membership: The members of a committee must be selected carefully. If the committee is to be effective the members must be representative of the interests they are expected to serve. They must also possess the required authority and be able to perform well in a group. In addition, the members should have the capacity to communicate well and reaching group decisions by integrated group thinking than by inappropriate compromise Subject Matter: Committee work should be limited to subject matter that can be handled in group discussion. Certain kinds of subjects lend themselves to committee action while others do not. Committees will be more effective if an agenda and relevant information are circulated well in advance so that the members can study the subject matter before the meeting. Chairperson: Selection of the chairperson is crucial for an effective committee meeting. Such a person can avoid the wastes and drawbacks of committees by planning the meeting preparing the agenda, seeing that the results of research are available to the members ahead of time, formulating definite proposals for discussion or action, and conducting the meeting effectively. The chairperson sets the tone of the meeting, integrates the ideas and keeps the discussion from. Wandering. Minutes: Effective communication in committees usually required circulating

minutes and checking conclusions. As times, individuals leave a meeting with varying interpretations as to what agreements were reached. This can be avoided by taking careful minutes of the meeting and circulating them in draft form for correction or modification before the final copy is approved by the committee Cost effectiveness: A committee must be worth its cost. It may be difficult to count the benefits, especially intangible facts such as morale, enhanced status of committee members and the committee's value as a training device to enhance teamwork. But the committee can be justified only if the costs are offset by tangible and intangible benefits.