Course: Management Theory and Practice

Internal Assignment Applicable for June 2022 Examination

1. Green Bell is a retail giant in India. Currently only confined to metro cities for
theirgiantsuper store outlets, they are planning to spread to smaller cities in India.
While workingon the resource allocation, HR is planning on shifting a few of the
current staff to newlocations while recruiting local staff at each location in parallel.
They need toengage the current staff in training for the newer audience. Discuss
the expansion fromthe point ofview of Hofstede’s five dimensions to include in the
training. (10 Marks)

Answer:

The work of Geert Hofstede,while employed at IBM in the late 1960s to early 1970s,
still stands as one of the most comprehensive studies of cultural values on leadership
in the workplace. From his data collected from over 30 countries and 100,000
individuals, Hofstede created a model of value dimensions that speak to the ways
that cultures tend to operate. Although this study is generalized to specific countries,
his work on cultural value dimensions is helpful to any business doing global and
multicultural work.
According to Hofstede, the five main dimensions are identity, power, gender,
uncertainty, and time. 

Cultural value dimensions help you to understand culture and to be able to make

sense of culture. These dimensions provide you with a perspective of culture for
yourself as well as a perspective of how others perceive their culture. All cultures
experience these dimensions of difference in many ways, and different cultures solve
these differences in many ways. Becoming aware of these concepts helps you to
figure out the experiences you have in relation to your culture. It helps to make that
experience less ambiguous and threatening. Cultural value dimensions provide
clarity and a starting place for cultural awareness. However, they are often seen as
intangible and under the waterline, but once you adapt to the cultural dimensions,
you become more comfortable and do not see the cultural difference.

Identity

Individualism refers to the degree to which a society focuses on the relationship of

the individual to the group. Collectivism refers to the degree to which a society
focuses on the relationship of the group as a whole.
In societies with high individualism (or low collectivism) scores, individuals are
valued for their achievements and are rewarded and recognized for such
achievements. In contrast, people who live in societies with low individualism (high
collectivism) are seen as being part of a wider group, known as the in-group. The in-
group includes the family, team, or social class, and how individuals relate to such
wider groups is seen as important to their success. In other words, people’s success
is gauged by how others in their groups view and support them.
For Example: Care should be taken in terms of how rewards are distributed.
Rewarding individual team members in low individualism societies can result in
tensions because the individual team member may become stigmatized. In such
cases, rewards done on a group level may work best.

Power
It is important for managers to express their authority and know-how in high power
distance societies. Subordinates expect clear directions from their managers and
assume they will be told what to do. In high power distance societies, employees will
often equate age with wisdom and seniority. For instance, if a multinational is
sending people to negotiate in a high-power distance country, they should send
higher-level and older managers if they want to be taken seriously.

Uncertainty
The dimension of uncertainty emphasizes cultures that are either oriented toward
uncertainty or toward creating certainty and stability. Hofstede described this as a
society’s tolerance for ambiguity.Societies that are in high uncertainty avoidance are
rule-bound and pay more attention to written procedures, rules, or goals. Individuals
who have a higher need for formalized structures, procedures, or diplomacy tend to
minimize their uncertainty levels in order to cope with the unknowns of their
situations. Someone who is on the other extreme of the dimension is more relaxed
about the rules and procedures; they are more flexible in their attitudes toward rules
and policies. 

Gender
Hofstededescribes the value dimension of gender as representing two paradigms of
thinking and practice about the world in relation to traditional values associated with
gender roles. Gender refers to the culture’s tendencies or orientation toward
enforcing or reinforcing masculine and feminine roles in work. Masculine cultures
tend to emphasize ambition, control, competition, assertiveness, and achievement,
whereas feminine cultures emphasize nurture, care, sharing, quality of life, and
relationships. women were treated more equally in their social systems.
It is important that you recognize that these values are not associated with being
male or female. In other words, this does not mean that men cannot be part of
feminine cultures or that women do not orient themselves toward “masculine”
cultural values. Finally, like other value dimensions, gender dimensions can vary
greatly within any culture.

Time
In organisations that focus on the long-term relationship with employees, typically
those employees work hard to live up to the expectations of management.
Employees who notice the long-term investment in the relationships often feel more
attached to the company/ organisation, and focus on longer-term goals. 
On the contrary, organisations that see employees as short-term and do not invest in
the relationships will likely experience a reduction in long-term planning and
prioritisation of short-term objectives but will leave when another better
opportunity arises.
 Understanding these five value dimensions and their impact in different cultural
systems will be helpful to your work in cultural intelligence. Like any cultural model,
you need to recognize that cultural factors in leadership and organizations, as
indicated by Taylor Cox, differ “across gender, nationality, and racial/ethnic groups
as it relates to time and space orientation, leadership style orientations,
individualism versus collectivism, competitive versus cooperative behaviour, locus of
control, and communication styles.

2. Sateesh is a project manager in an IT company. He needs to deploy some

additionaldevelopers to be based on site. He has a meeting with the HR for the
same and needs togive a plan of resource deployment to the HR with clarity on
how many new members vshow many current developers can be deployed on site.
Managers have to make manydecisions. Discuss various types of decisions
managers typically make based on natureof the decisions, level of the
management or capacity. (10 Marks)

Answer:

Managerial decision-making is a process aimed at resolving identified problems and

enabling effective and efficient performance of business activities. It is a cognitive
process of making choice between more options, based on available information,
knowledge, experience and beliefs of decision-makers. It involves the rational and
irrational mechanisms of thinking and all depending on the complexity of the
decision that managers make, time that they have available for making decision and
the circumstances which condition the criteria for deciding. Decision-making is an
integral part of the most of managerial activities and it is crucial for successful tasks
resolving and achieving business goals. Therefore, it is an essential process of
modern management representing, in every field, the core function for the manager.
Management helps organizations to realize the business goals by planning,
organizing, leading and controlling certain resources. However, in order to realize
any activity, it is necessary to make a decision. Managers should make functional
decisions, which are for the moment adequate and of quality and which will
contribute to the improvement of work processes and the relationship with the
environment. Making a good decision implies knowledge of all environmental factors
that may potentially influence business performance.

BASED ON LEVELS OF MANAGEMENT

Decision making can also be classified into three categories based on the level at
which they occur. Strategic decisions set the course of organization. Tactical
decisions are decisions about how things will get done. Finally, operational decisions
are decisions that employees make each day to run the organization. 

Strategic Decisions
Strategic decisions are important which affect objectives, organisational goals and
other important policy matters. These decisions usually involve huge investments or
funds. These are non-repetitive in nature and are taken after careful analysis and
evaluation of many alternatives. These decisions are taken at the higher level of
management.

Tactical Decision
Tactical planning is done at middle management level, which mainly involves the
resource acquisitions and utilisations to achieve the organisational goals. Tactical
plans cover shorter time frames and are associated with less uncertainty and hence
lower risk as compared to strategic planning.
Tactical level production planning is a medium-term planning. (A planning period
ranging between 2 to 3 years). Tactical planning is mainly concerned with deciding
specifically how the resources of the organisation will be utilised to achieve the
organisational strategic goals. Tactical planning involves less uncertainty and hence
lower risk compared to strategic planning. Mainly the planning requires internally
generated data.Decisions pertaining to various policy matters of the organisation are
policy decisions. These are taken by the top management and have long term impact
on the functioning of the concern. For example, decisions regarding location of plant,
volume of production and channels of distribution (Tactical) policies, etc. are policy
decisions.
Tactical planning decisions include:

 Establishing parameters for measuring operational efficiency and

productivity.
 Making plans to improve utilisation of existing resources.
 Prepare equipment and manpower planning.
 Planning for modernization of the facilitates and automation.
 Specific technology and tools to enhance production efficiency or
productivity.

Operational decisions
Operating decisions relate to day-to-day functioning or operations of business.
Middle and lower-level managers take these decisions.
An example may be taken to distinguish these decisions. Decisions concerning
payment of bonus to employees are a policy decision. On the other hand if bonus is
to be given to the employees, calculation of bonus in respect of each employee is an
operating decision.

BASED ON NATURE OF DECISION

Programmed and non-programmed decisions:
Programmed decisions are concerned with the problems of repetitive nature or
routine type matters.
A standard procedure is followed for tackling such problems. These decisions are
taken generally by lower-level managers. Decisions of this type may pertain to e.g.
purchase of raw material, granting leave to an employee and supply of goods and
implements to the employees, etc. Non-programmed decisions relate to difficult
situations for which there is no easy solution.
 These matters are very important for the organisation. For example, opening of a
new branch of the organisation or a large number of employees absenting from the
organisation or introducing new product in the market, etc., are the decisions which
are normally taken at the higher level.

Managers are constantly making decisions, and those decisions often have significant
impacts and implications for both the organization and its stakeholders. Managerial
decision-making is often characterized by complexity, incomplete information, and
time constraints, and there is rarely one right answer. Sometimes there are multiple
good options (or multiple bad options), and the manager must try to decide which
will generate the most positive outcomes (or the fewest negative outcomes).

3. EarthMovers Ltd are into providing heavy vehicle services. They have various
heavyvehicles like tractors, cranes, bull dozers, mixer trucks, etc. They have been
growingincreasingly and have employed a total staff of 1200. They have divided
their business ina Divisional structure. Based on this information, answer the
following questions.

a. Discuss the features of divisional structure of organization and infer the divisions
thatEarthMovers may have employed. (5 Marks)

Answer:

A divisional organizational structure is a system in which a company segments its

employees based on products or markets, as opposed to their job roles. Some
companies have marketing, sales and communications departments, while a
divisional organization has trams dedicated to a specific region or product. This is
most useful for larger companies that benefit from organizing their workforce into
relatively independent groups. Businesses using divisional structure may have one or
more of the following characteristics:
 Selling a wide range of customer-facing product lines
 Offering both businesses-to-customer and business-to-business services
  Advertising to a wide variety of demographics
 Marketing their brand in different geographic locations
 Serving major clients who need individualized attention

In a product-based structure (also known as a divisional structure), you assign

employees into self-contained divisions according to:
 the particular line of products or services they produce
 the customers they deal with
 the geographical area they serve
The structure may have several layers of managers and employees. Each layer (ie
division) can have its own marketing team, its own sales team, and so on. A manager
typically reports to the head of the company by product type, eg sporting goods,
housewares and general merchandise. Certain key functions (eg finance or human
resources) may be provided centrally.
For example, a computer software business may divide its structure according to its
two distinct customer groups - home users and business users. In such an
arrangement, all employees working on the development, sales or promotion of
business software would be in one division, while everyone working on software for
home users would be in another.

FEATURES

Accountability
This approach makes it much easier to assign responsibility for actions and results. In
particular, a division is run by its own management group, which looks out for the
best interests of the division.
Competition
The divisional structure works well in markets where there is a great deal of
competition, where local managers can quickly shift the direction of their businesses
to respond to changes in local conditions.
Culture
 You can use this structure to create a culture at the divisional level that most closely
meets the needs of the local market. For example, a retail division could have a
culture specifically designed to increase the level of service to customers.

Businesses typically need organizational structures in order to perform at their best.

Divisional structure is one system a company may use to improve different aspects.

b. Elaborate on the factors that influence organizational structures. (5 Marks)

Answer:

An organizational structure is a system that outlines how certain activities are

directed in order to achieve the goals of an organization. These activities can include
rules, roles, and responsibilities.
The organizational structure also determines how information flows between levels
within the company. For example, in a centralized structure, decisions flow from the
top down, while in a decentralized structure, decision-making power is distributed
among various levels of the organization.
Having an organizational structure in place allows companies to remain efficient and
focused.

Factors Affecting Organization Structure

Organization structure is designed keeping in view the following factors:

1.    Strategy:
Strategy determines a course of action to direct various organizational activities. It
makes plans to co-ordinate human and physical resources to work towards a
common objective. Strategy is pre-requisite to organization structure and also
follows it. The relationship between strategy and organization structure is depicted
as follows:
Strategies to diversify product lines or markets require decentralized transition as
decision-making is done at wider level and strategies for organizations working in
stable environment. Where managers do not diversify their operations, require a
centralized organization.

2.    Technology:
The technology for manufacturing goods and services also affects the organization
stricture.

In case of mass production technology, mechanistic organization structure is more

appropriate, while in case of continuous production or small scale production
technology, the appropriate from is organic structure. This is because mass
production technologies involve standardization and specialization of work activities
and continuous or unit production technologies require low levels of standardization
and specialization.

3. Informal organization:
Informal organizations are and outgrowth of formal organizations. Social and cultural
values, religious beliefs and personal likes and dislikes of members which form
informal groups cannot be overlooked by management.

4. Size:
A group known as Aston Group conducted research on firms of different sizes and
concluded that as firms increase in size, the need for job specialization,
standardization and decentralization also increases and organizations are structured
accordingly.

5. Environment:
Organization structure cannot ignore the effects of environment. Organizations must
adapt to the environment, respond to incremental opportunities and satisfy various
external parties such as customers, suppliers, layout unions etc.
In case of stable environment where people perform routine and specialized jobs,
which do not change frequently, a closed or mechanistic organization structure is
appropriate.

6. Managerial perceptions:
Organizations where top managers perceive their subordinated as active, dynamic
and talented entrepreneurs, prefer organic form of structure, If they hold negative
opinion about their subordinates, they prefer mechanistic organization structure.

Not having a formal structure in place may prove difficult for certain organizations.
For instance, employees may have difficulty knowing to whom they should report.
That can lead to uncertainty as to who is responsible for what in the organization.