Management Theory and Practice

Answer 1:
Introduction:
Today's global business practices have made a multicultural work environment a trend.
It enables organizations with a global presence to effectively serve their customers from remote
locations. However, this new trend creates cultural differences that have an impact on employee
and organizational performance. The most common issue that people face as a result of cultural
differences in communicating with other members of their teams, particularly when they
operate from different geographical locations. Managers face a big problem in managing
cultural differences. As a result, managers should understand the managerial abilities required
in a cross-cultural team setting. Managers must evaluate the various aspects of company culture
in order to effectively handle cultural differences. The dimensions of culture refer to these
features. To comprehend and analyze the dimensions of corporate culture, organizations
employ a variety of models.

Concept and Application:

The Cultural Dimensions Theory, developed by Hofstede, provides a framework for
defining the effects of culture on its members' values and how these values relate to behavior.
In cross-cultural psychology, international management, and cross-cultural communication,
Hofstede's work is essential. Hofstede’s cultural theory is a framework for cross-cultural
communication. The concept is based on a global analysis of how culture influences workplace
values and leadership. According to Hofstede's cultural dimensions theory, each dimension
exists on a scale of low to high. Dr. Geert Hofstede created this model as a result of a decade
of research in 40 nations. The four dimensions of business culture were defined by Hofstede.
Later on, the fifth dimension was added to this model.
Hofstede’s Five Dimensions of Culture are as follows:

Power
Distance

Individu
Long-
alism
Term
and
Orientati
Collectiv
on Cultural
Dimensio ism
ns

Uncertai
Masculin
nity
ity/
Avoidanc
Feminity
e

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 Management Theory and Practice

 Power Distance: It demonstrates the difference between people with and without
power. People who have less power question authority and try to distribute power.
A higher power denotes that society has established a hierarchy and that people accept
unequal power distribution and the status of a leader. The culture respects authority and
rank and conforms to power differences and inequality.
A low power distance indicates that power is shared and distributed. According to this
dimension, decision-making should be delegated and everyone should be involved. The
focus is on participative management and decentralized decision-making in this culture,
which promotes a flat organizational structure.

 Individualism and Collectivism: It looks at how people are integrated into a

community and made aware of their responsibilities and dependencies.
Individualism is the tendency for people to place a high value on personal achievement.
People in individualistic societies do not form relationships with anyone other than their
immediate families. Individualism denotes a higher priority placed on achieving
personal objectives. In individualism, a person's self-image is defined as "I."
Collectivism refers to a society's interconnected relationships, which include families
and groups. People are loyal to their group and hold each other accountable. They are
dedicated to their group and support the best interests of all of its members.
Collectivism denotes a greater emphasis on the group's goals and well-being. In
collectivism, a person's self-image is defined as "We."
 Masculinity / Femininity: It directs the distribution of male and female roles in
society. In society, masculinity is defined as a desire for assertiveness, heroism,
achievement, and material rewards. Femininity is a desire for modesty, cooperation,
and concern for the weaker members of society. In a feminine society, women play a
passive role and share caring viewpoints equally with men. Men are assertive and
competitive in a masculine community, while women are nurturing. In this society,
being strong is regarded as a positive trait. Male and female values are always in
conflict.
 Uncertainty Avoidance: It describes society's tolerance for uncertainty or confusion
and guides how people cope with anxiety. Low tolerance for uncertainty, ambiguity,
and risk-taking are indicated by high uncertainty avoidance. The unknown is reduced
by enforcing strict rules and regulations. High tolerance for uncertainty, ambiguity, and
risk-taking are indicated by a low uncertainty avoidance index. The unknown is more
readily accepted, and there are fewer rules, regulations, and restrictions in place.
 Long-Term Orientation: It relates to the past's connection and relationship to current
and future challenges. Long-term orientation is characterized by a focus on the future
and the willingness to postpone immediate satisfaction to achieve long-term success.
Persistence, perseverance, and long-term growth are the key aspects of long-term
orientation. Low long-term orientation emphasizes the present over the future and
focuses on the immediate future. Low long-term thinking emphasizes speed and
tradition.

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 Management Theory and Practice

HR should follow the following steps to allocate the current employees and train the new
employees according to Hofstede’s Five Dimensions of Culture.
 First, they must pay close attention to their clients and maintain close contact with them.
 They should follow strict rules while dealing with clients and competitors, and they
should be given authority.
 Time relates to cultural interactions and activities. They must be patient in their
development because time is of the essence.
 They should provide equal weight to both male and female positions at work to achieve
more.
 They should learn how to deal with uncertainty and unpredictability.

Conclusion:
Hence, Hofstede's Cultural Dimension will assist “Green Bell” a retail giant in India in
overcoming cultural and geographical differences that result in poor communication between
people from various countries and cultures. The theory offers a way to make sense of
differences and create a harmonious environment without making a mistake.

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 Management Theory and Practice

Answer 2:
Introduction:
Every now, a firm must make decisions on its work processes, workers, technology,
finance, sales, and production. Every action taken by a company has an impact on its overall
performance. As a result, a company must exercise caution when making decisions. A decision
is said to be effective if it is made within the allotted time and with the best use of the available
resources. Identifying the problem for which a decision must be made, gathering relevant
information, developing potential courses of action and selecting the best one, implementing
the action, and following up are all key steps in the decision-making process.

Concept and Application:

Managerial decision-making is a method for resolving difficulties and supporting the
effective and efficient performance of organizational tasks. It is a mental process in which
decision-makers choose amongst multiple possibilities based on available information,
knowledge, experience, and beliefs. It involves both rational and irrational thinking processes,
and it all depends on the specific decision that managers make, the amount of time they have
to make the decision, and the variables that influence the conditions for making the decision.
Managerial decisions can occasionally have ethical consequences, which should be considered
before making a final choice.
Types of Managerial Decision-Making are as follows:

Based on the Levels of Management

• Strategice Decisions
• Tactical Decisions
• Operational Decisions

Based on the Nature of Decisions

• Programmed Decisions
• Non-programmed Decisions

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 Management Theory and Practice

 Based on the Levels of Management: There are three levels of management in an

organization: strategic (top-level), tactical (middle-level), and operational (bottom-
level). Decisions are taken at all three levels to keep the organization running smoothly.

Top Level (Strategic

Level)

Middle Level
(Tactical Level)

Bottom Level
(Operational Level)

 Strategic Level: Strategic decisions are the firm's most critical decisions. Upper
and middle management are typically responsible for these. They are frequently
related to the firm's policies or future strategic plans. These are the
organization's long-term decisions, which require huge financial and resource
investments. It involves a high level of risk.
 Tactical Level: These decisions are made by an organization's middle
management. Tactical decisions are taken to put strategic judgments into action.
In other words, middle-level managers make decisions to guarantee that top-
level objectives are met on time. For example, decisions about the plant's
location or production volume. These are tactical decisions.
 Operational Level: Operational managers make these decisions when it comes
to an organization's everyday operations. If these judgments are ineffective, the
organization's performance may suffer. As a result, such decisions must be
accurate with the company's overall business plan. These decisions do not take
much time and are quicker than other decisions. Subordinates have a lot of
responsibilities.

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 Management Theory and Practice

 Based on the Nature of Decisions: Different types of problems arise in an

organization, and they cannot always be treated using the same technique. As a result,
the business must understand the nature of these issues and make appropriate decisions.
There are two types of nature of decisions such as

 Programmed Decisions: These are decisions that are made on a regular basis
and are repetitive in nature. They include factors such as consumer purchasing
behavior, granting various kinds of leave to employees, purchasing decisions,
and salary raises.
 Non-programmed Decisions: These decisions are only taken when the need
arises. Non-programmed decisions are frequently made in response to
opportunities and dangers, requiring a detailed analysis of all business aspects.
Top management is in charge of making such judgments. Opening a new
branch office, for example, will be a non-programmed decision.

Importance of Managerial Decision Making:

Effective Utilization of Resources

Handling of Problems and Challenges

Accomplishment of Business Goals and Objectives

Improved Efficeincy

Promotion of Innovation and Creativity

Increased Motivation

o Effective Utilization of Resources: An organization must carry out its daily operations
with limited resources. Men, money, machines, and material are the resources available.
If these resources are overused, the company may pay additional costs. Effective
decision-making helps in the most efficient use of resources by allocating resources
according to requirements.
o Handling of Problems and Challenges: Various problems and challenges develop in
a business environment as a result of sudden changes. For long-term existence, an
organization must address these issues as soon as possible. Effective decision-making
can assist a company in dealing with the challenges of the business world.

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 Management Theory and Practice

o Accomplishment of Business Goals and Objectives: Managers make reasonable

judgments by carefully measuring all available options and their implications for the
organization's operations. Making decisions is critical to achieving business goals and
objectives.
o Improved Efficiency: Efficiency is measured in terms of costs and earnings in a
business. Profits and costs are both measures of efficiency in a business. Decision-
making aids in cost reduction by optimizing resource usage, resulting in increased
earnings. As a result, the organization's efficiency improves.
o Promotion of Innovation and Creativity: New ideas, methods, and concepts are
developed when rational decision-making occurs in an organization. It leads to
creativity and innovation, allowing a company to respond rapidly to changes in the
business environment.
o Increased Motivation: Employees are motivated to perform at their best in an
organization when decisions are made. It teaches them to take responsibility for
problems and fix them after a careful examination of all possible solutions. Employee
decisions that are successful benefit the organization as well as the employees in both
monetary and non-monetary ways. This encourages employees to contribute to the
company's success.

Conclusion:
One of the most crucial aspects of the management process is decision-making. Hence,
Mr. Sateesh with the help of the managerial decision-making can make an effective and
efficient plan for deploying the new developers and the current developers on the new site.

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 Management Theory and Practice

Answer 3a:
Introduction:
An organization is a group of people who work together to achieve similar objectives. The
backbone of any organization is the division of responsibilities according to a ranking system.
We must examine an organization's organizational structure closely to comprehend it.

Concept and Application:

Divisional Structure: A divisional organization structure is an organizational structure in
which an organization is divided into different independent parts. The division is based on the
organization's product, market, and geographic region. When decision-making should be
concentrated at the division level to react more swiftly to local situations, this strategy is useful.
When a business has multiple areas, markets, and/or products, the divisional structure comes
in handy. However, it can result in higher overall costs and several numbers of little, fighting
power bases within a corporation that don't always work together for the interest of the whole.

 Advantages of Divisional Structure:

 Accountability: The divisional control of all aspects of the firm makes the
performance more apparent. It is simple for firm executives to observe which divisions
are functioning well and which are not.
 Team Work: A division's workers must collaborate to achieve outcomes, which
boosts morale and fosters collaboration as employees work toward a common goal.
Increased performance is a result of the enhanced business culture.
 Efficiency: Internal communication is easier, and each employee is aware of the
division's requirements. Local decision-making can be based on external
developments, resulting in faster reaction times and better division outcomes.
 Better Leadership: Working divisions have more direct management and a clear
structure, ensuring that no one is confused about who is in charge. The majority of
decisions affecting the division's day-to-day operations are made by divisional
managers.
 Improved performance: Internal focus on the division's success is a straightforward
strategy to improve performance. Performance and profitability both improve when
problems are dealt with quickly and efficiently.

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 Management Theory and Practice

 Disadvantages of Divisional Structure:

 Solo Mentality: When divisions operate independently, attitudes of 'we against them'
can arise, as well as what is known as the solo mentality,' in which a division focuses
solely on its own business and almost forgets that it is part of a bigger organization.
 Ineffective communication: Each division may be unaware of the goals, objectives,
and needs of other divisions, resulting in costly accounting, tax, and work duplication
issues (and related costs). Interdivisional rivalries and negative feelings can also be
caused by a lack of communication.
 Costs: When you set up a full set of functions within each division, you're likely to
have more employees overall than if the company was organized merely operationally.
There would also be a corporate organization, which adds to the business's overhead
expenses.
 Strategic Focus: Each division will have its strategic direction, which may differ from
the company's overall strategic direction.

CEO

Mixer
Tractors Cranes Bulldozers
Trucks

R&D R&D R&D R&D

Marketing Marketing Marketing Marketing

Finance Finance Finance Finance

IT IT IT IT

By applying the divisional structure concept Earth Movers Ltd can divide its 1200 employees
equally in each heavy vehicles department and later on its sub-departments according to the
figure shown.

Conclusion:
If not managed properly, divisional organizational structures can lead to morale issues and
a silo mindset. These problems can be avoided with the correct top management, executives,
and overarching company vision in place.

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 Management Theory and Practice

Answer 3b:
Introduction:
The form or structure of the division of all these roles and duties is known as an
organizational structure. The organizational structure explains which individual is responsible
for which task. The hierarchy in which members of an organization rank themselves is likewise
depicted by such a structure. A company's organizational structure can be divided into two
types: centralized and decentralized. Decisions are made at the top-level management and
passed down to the lower-level management in a centralized organization. In a decentralized
organization, on the other hand, departments are allowed the flexibility to make their own
decisions based on their requirements.

Concept and Application:

Designing an organizational structure requires careful consideration and control. This is
because an ineffective organizational structure can have a serious effect on the company's
performance. The structure of an organization is influenced by a variety of factors that are as
follows:

Environ
ment

Factors
Organiz
Technolo Influencing
ational
gy Organizational
Size
Structure

Organiz
ation's
Strategy

 Environment: It is the total of all the factors, conditions, events, and influences that
surround and influence an organization's activity. While designing its structure, the
organization should analyze the environment in which it functions. This helps an
organization in gathering knowledge on current market trends and changes and
developing its structure accordingly. The environment of an organization is divided into
two environments that are internal and external. All of the factors that are under the
control of an organization are included in the internal environment. It's also known as
an organization's strengths and weaknesses. All factors outside of an organization's

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 Management Theory and Practice

control are considered part of the external environment. An organization's external

environment can either provide opportunities or pose threats.
 Strengths: These are the internal characteristics of an organization that assist
it in achieving its aims and objectives. An organization's strengths include
sound financing, reduced costs, flexibility, successful marketing, an effective
system, and strong relationships with suppliers, among others.
 Weaknesses: It is an internal weakness that causes an organization’s overall
disadvantages. An organization's weaknesses include a lack of funds, a slow
response to customer requests, a limited product range, poor production, and
so on.
 Opportunities: These are external factors that are favorable to an organization
and can help it improve its position. Opportunities include decreasing
competition performance, access to target clients, political and legal regulatory
influence, and the development of new distribution channels.
 Threats: These are the situations that can generate problems for businesses.
For example, high raw material prices, a poor success rate, more competitive
products, and so on.
 Organizational Size: Size can refer to the number of employees, assets, sales, and other
factors. Small businesses have fewer regulations for how things should be done and
more flexibility in how staff deal with challenges. The tendency to adopt more rules
and decrease flexibility increases as the company grows and its design becomes
unavoidable.
 Organization’s Strategy: The organization's strategy must be well to the structure of
the organization. If an organization's structure is the vehicle through which it achieves
its goals, strategy and structure should be closely linked.
 Technology: The introduction of modern technologies has automated various
organization activities. As a result, there is less demand for human resources.

Conclusion:
Hence, while planning an organizational structure such factors must be considered for
having a proper structure and for greater growth of the organization.

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