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Discuss management questions within the Principles of Management / Perspective Management forums, part of the Resolve Your Query - Get Help and discuss Projects category; PART A (Any five) Q.1 "Management is a combination of Arts, Science & Profession" Explain fully. Management is collection of ...

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Sai Kumar
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sandyraj
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management questions - January 4th, 2008

PART A (Any five)

Q.1 "Management is a combination of Arts, Science & Profession" Explain fully.

Management is collection of different activities such as Planning, Organizing, Controlling, Directing and Coordinating. These activities should be supported with good leadership quality, good communication, motivation and morale. Management is getting work done through and with other people. This requires lot of efficiency and combination of different qualitative. A good manager should have artistic qualities, manager should be aware of social - science and manager should be a thorough professional.

Management's lot of features can be compared with features of Art.
a) Art requires skill.
A good management is a combination of Conceptual, Technical, Human
Relations and Decision making skills. Without skill Art is not there, similarly
Without Conceptual, Technical, Human Relations and Decision making skills
nobody can become a good manager. Without these skills management is nothing
but failure.
b) Art requires knowledge.
A good manager should have learning and acquiring knowledge. The knowledge cannot be limited to just one domain, they have to have the knowledge of Marketing, Finance and Production. A good manager should be open to learn and he/she should have a good analytical skills.
c) Art is Creative
A good manager should have creativity. Manager should be able to come up with new ideas and new products to facet the new challenges of competition. Manager can motivate his employees through his/her creativity. Management can be successful if the manager is creative.
d) Art is personalized
Each person is unique and similarly each manager is different and their way of approach is different. A manager can be Democratic, Autocratic, Paternalistic and Bureaucratic. Success of management depends on the manager’s way of approach to the situation.
e) Art is performance.
We cannot judge an art as good or bad easily. It is relative/subjective. An art, which is good for one person, can be bad for the other person. Similarly management cannot be judged based on only profit, growth, development and market share. Through these we can only understand management as concept. So to judge a management as good or bad apart from the above-mentioned factors various other performance indicators are also required.

Management can be compared with Science – Social science
a) Science is a body of organized knowledge
Without an organized knowledge management is a failure.
b) Science is developed over a period of time
The concept of management is not new. It is evolved over a period of time. It has gone through revolutionary changes time to time.
c) Science establishes cause and effect relationships.
A good management can effect the relationship in a positive manner and it will be responsible for the good cause of the organization.
d) Science has predictive power.
A good manager is one who has good predictive power. The manager has to fore seen the situation and take necessary actions.
e) Rules/Regulations in Science are verified time to time. Old rules are challenged, new rules are established
Management approach is changing periodically. Management adopts new rules based on the situation.
f) Science of two types: Perfect science like physics/chemistry/mathematics and Social Science like management.
Management is based on assumptions and presumptions also. The assumptions like market may change, product may click in the market etc makes management a social science.

Management can be compared with Profession.
Theoretically and Academically management is developed towards profession. We have to compare characteristics of profession with that of management.
Profession : Any discipline to be called, as profession must fulfill the following conditions.
1. It requires definite period of learning
2. It has centralized rule making authority
3. It has enforceable code of conduct
4. Membership through acquired qualification and approval
5. It needs certificate of practice
6. Social commitment/obligation/accountability
To call Management as a profession,
1. Many organizations prefer individuals with MBA, DBM qualifications for the post of a manager. Though this is not a must, this has got definite period of learning.
2. Though there is no centralized rule making authority, there are a number of parent bodies in specialized functional areas such as Institute of Marketing Management, Institute of Materials Management, National Institute of personal management and so on.
3. These parent bodies can publish desirable code of conduct, but that can not be enforced as law in management.
4. Individuals born in business families get ownership right/management right mainly due to law of inheritance. It is irrespective of qualification they hold.
5. There is no legal definition of the term manager. Management as a discipline does not require any certificate of practice.
6. Managers do have social commitment/accountability/obligation. This is part of social responsibilities of management. These responsibilities are desirable and not enforceable under every law.
The term ‘Profession’ or ‘Professional Manager’ has got different connotation. This approach is very close to practice of management. This approach clarifies role of profession manager as well as who can be called as professional manager.
Based on all these factors,
Management is not just a process
Management is not just a list of functions
Management is not just Arts and Science
Management is and should be way of life.


Q.2 “Planning can not eliminate risk but can minimize it”. Explain this statement
with reference to the limitations of planning. Also write a note on the various
strategies adopted by Indian Companies to stay ahead of competition.


Q.3 What are the different types of motivators? Explain Maslow’s theory of
hierarchy of needs. Why study of motivators is important to manager?

Motive is a desire that impels a person to a certain behavior.
Motivation can be observed in the following Needs - satisfaction chain


Needs give rise to
|
Wants
|
Tensions
|
Drives or Action
|
Satisfaction or Dissatisfaction
In this chain every step is the motivator.

Following are the different kinds of motivators:
• Financial (Everything related to money, example: Salary, Perks)
• Non financial (Encouragement, Freedom, Recognition)
• Positive (Rewards, Incentives)
• Negative(Fear, Compulsion, Force)
• Internal (Individual inner drive, Urge)
• External(Individual doing it for someone)
• Open and hidden (Hiding the status which results in bad consequence.
• Ethical (Honesty, Integrity, Hard work)
• Unethical (Most debatable types as it suggests corruption as source of motivation. If dishonesty is rewarded can it become source of motivation?)

List of general motivators:
• Good pay/salary
• Promotion, Regular increment
• Job security
• Interesting work
• Competent supervision, Leadership
• Friendly and helpful co-workers
• Clearly defined goals and expectations
• Authority
• Enough information
• Opportunity to see results of work
• Enough help and resources
• Performance based incentives
• Equality and fairness at workplace
• Family priorities and Demands
• Proper communication
• Level of confidence shown by superior
• Organizational policies, rules, systems
• Challenges in the job/responsibilities assigned
• Individual’s performance to list of satisfiers such as money, status, social standing, recognition etc.
• Freedom at workplace.
This list changes as per time, workplace and nature of job.

Maslow’s hierarchy of Needs:
Human needs are an important part of human nature. Values, beliefs, and customs differ from country to country and group to group, but all people have similar needs. As a leader you must understand these needs because they are powerful motivators.
Abraham Maslow felt that the basic human needs were arranged in a hierarchical order. He based his theory on healthy, creative people who used all their talents, potential, and capabilities. At the time, this methodology differed from most psychology research studies which were based on the observation of disturbed people.
There are two major groups of human needs: basic needs and meta needs.
Basic needs are physiological, such as food, water, and sleep; and psychological, such as affection, security, and self esteem. These basic needs are also called deficiency needs because if an individual does not meet them, then that person will strive to make up the deficiency.
The higher needs are called meta needs or growth needs. These include justice, goodness, beauty, order, unity, etc. Basic needs take priority over these growth needs. People who lack food or water cannot attend to justice or beauty.
These needs are listed below in hierarchical order. The needs on the bottom of the list (1 to 4) must be met before the needs above it can be met. The top four needs (5 to 8), can be pursued in any order depending on a person's wants or circumstance, as long as all the other needs (1 to 4) have all been met.
8. Self-transcendence - a transgenic level that emphasizes visionary intuition, altruism, and unity consciousness.
7. Self-actualization know exactly who you are, where you are going, and what you want to accomplish. A state of well-being.
6. Aesthetic - at peace, more curious about inner workings of all.
5. Cognitive - learning for learning alone, contribute knowledge.
4. Esteem - feeling of moving up in world, recognition, few doubts about self.
3. Belongingness and love - belong to a group, close friends to confine with.
2. Safety - feel free from immediate danger.
1. Physiological - food, water, shelter.
Maslow posited that people want and are forever striving to meet various goals. Because the lower level needs are more immediate and urgent, if they are not satisfied, they come into play as the source and direction of a person's goal.
A need higher in the hierarchy will become a motive of behavior as long as the needs below it have been satisfied. Unsatisfied lower needs will dominate unsatisfied higher needs and must be satisfied before the person can climb up the hierarchy.
Knowing where a person is located on this scale aids in determining an effective motivator. For example, motivating a middle-class person (who is in range 4 of the hierarchy) with a certificate will have a far greater impact than using the same motivator to motivate a minimum wage person from the ghettos who is struggling to meet needs 1 and 2.
It should be noted that almost no one stays in one particular hierarchy for an extended period. We constantly strive to move up, while at the same time forces outside our control try to push us down. Those on top get pushed down for short time periods, i.e., death of a loved-one or an idea that does not work. Those on the bottom get pushed up, i.e., come across a small prize or receive a better paying job. Our goal as leaders, is to help our people obtain the skills and knowledge that will push them up the hierarchy permanently. People who have their basic needs met become much better workers. There are able to concentrate on fulfilling the visions put forth to them, instead of consistently worrying about how to make ends meet.
Characteristics of self-actualizing people:
Have better perceptions of reality and are comfortable with it.
Accept themselves and their own natures.
Their lack artificiality.
They focus on problems outside themselves and are concerned with basic issues and eternal questions.
They like privacy and tend to be detached.
Rely on their own development and continued growth.
Appreciate the basic pleasures of life (do not take blessings for granted).
Have a deep feeling of kinship with others.
Are deeply democratic and are not really aware of differences.
Have strong ethical and moral standards.
Are original and inventive, less constricted and fresher than others














5 5 Self Actualization

4 4 Esteem

3 3 Social Needs

2 2 Safety Needs

1 1 Physiological needs

This figure indicates level of needs number one and number 2 can be called primary needs and number 3/4/5 can be called as secondary or higher level of needs.









This staircase suggests that once level number one is achieved, it is no more the motivator. Individual graduates to the second level and so on.
Example till individual is not employed. Employment/job is the biggest motivator. Once he/she gets the job, job does not motivate him/her but now he/she looks for the confirmation in the job.

A manager’s job is to get the work done through his/her subordinates by motivating them. An employee can do the work only when he is motivated to do that work. So the manager should know the motivation factors and the way to motivate employees.
There are four categories of employees based on the motivation factors. They are:
• Motivated and willing to work
• De-motivated and willing to work
• Motivated but unwilling to work
• De motivated and unwilling to work
Study of motivators is like study of psychology of employees. A good manager is one who can motivate his/her employees to do better work and keep them happy. So study of motivators is essential for all the managers.

Q.4 Define Delegation of authority. What are the problems in delegation? Explain
the principles of effective delegation.

Delegation means “Authorizing subordinates to make certain decisions”. Delegation is must
because – a. Structure of authority/accountability exists.
b. Superiors need to concentrate on important and vital issues.
Reasons for Delegation
• To enable the manager to get more work done by utilizing the skills and talents of subordinates.
• To foster the development of subordinates by having them participate in decision making and problem solving that allows them to learn about overall operations and improve their managerial skills.
Delegation has basically 5 degrees – Zero, low, moderate, high and fifth degree.
• Low degree of Delegation : Low degree of delegation is that in which a superior states a particular task to his subordinates and tell him to investigate on that task and report back.
• Moderate degree of delegation : It is in which a superior states the task to his subordinate. He tells him to investigate on that task and report back with action plan.
• High degree of delegation : It is that degree of delegation in which a task is specified to a subordinate and he is told to investigate on that task, make an action plan, formulate the plan and then report back with the results and reasons.

Problems in delegation is of two types :
• Problems in delegation - Manager
• Problems in delegation - Subordinate

Problems in delegation – Manager :
• Reluctant to delegate - Some managers believe in fallacy i.e. if we want it done right, do it yourself.
• Superiors delegation method - Poor examples set by superiors who do not delegate may discourage the managers to delegate further
• Subordinate’s success threatens superior’s advancement. – Low self-confidence more over confidence amongst the managers may create a bottleneck in a process of delegation
• Lack of trust in the subordinate to do well – Managers lacking required confidence and trust in subordinates might not be interested in delegating the authority.
• Fear of loosing position - Fear amongst managers that they will loose status and position.
Problems in delegation – Subordinates:
• Reluctant to accept power - Reluctant to accept delegation for fear of failure.
• Expects reward - Perceives no rewards for accepting additional responsibility.
• Fear of risk - Prefers to avoid any risk and responsibility.
Following are the ten principles of effective delegation:
• Explain the degree of delegation - The degree of delegation should be clear to both the superior and the subordinate.
• Select appropriate subordinates – Delegation should be to a right person.
• Keep lines of communication open – After the delegation there should be always a open communication channel between superior and subordinate.
• Train your subordinate and motivate them – Subordinates should be trained for the relevant work before delegating and superior should motivate the subordinate to do that delegated work.
• Reward delegation – Financial and non-financial – Subordinates should be rewarded for the delegated work. This is like a motivation for subordinates
• Keep appropriate reporting system and controlling – Supervisor should monitor the progress of delegated work, this is controlling and subordinates should report to the supervisor periodically and they should keep the superior informed about the proceedings.
• Don’t delegate and disappear – After delegating the work superior cannot escape from the responsibilities, he/she should control the delegated work.
• Don’t follow practices of ‘Delegation on Paper’ – Delegation should be done personally if it is only on paper it will not be effective.
• Believe in feedback, interaction and result orientation of delegation – Superiors should give constant feed back to the subordinates. A good interaction between superior and subordinates results in a good delegation of work.
• Principle of exception – Subordinates should not consult superior for routine matter. Subordinates should act independently.

Q.5 What is controlling? What are the principles of effective control? What steps an
organization should take before things go out of control?

Controlling in simple terms means monitoring or measuring the progress of
accomplishment of the goal.
For an organization to function effectively certain goals and objectives must be
clearly set. Plans can be realized only through effective managerial control.
Control involves setting the important standards in the organization.

In other words control can be defined as :
“Planning is the basis of control,
Action is the essence of control,
Delegation is the key to control,
And information is the guide to control.”

Definition of control as stated by few great management contributors.
“Managerial control implies measurement of accomplishment against standard and
the correction of deviations to assure attainment of objectives according to plans.” –
Koontz O’ Donnell
“Control Consists in verifying whether everything occurs in conformity with the
plans adopted, the instructions issued and the principles established.” – Henry Fayol
“Control maintains the equilibrium between ends and means, output and efforts” –
Peter Drucker

Principles of effective Control:
• Suitability : The technique of control to be used should suit the organizational working system. Different departments should have different system of control.
• Deviations: Any changes in conditions should be reported well in advance so that immediate action can be taken to avoid loss or damage.
• Objective : Control should be done with accurate and suitable standards. Management should take into consideration the proper objectives of the organization for control to be effective.
• Predictions : Control should also aim for the future. If necessary steps are taken well in advance, the management will be able to take both corrective and precautionary measures.
• Flexible : Necessary flexibility is required in control design so that control can be effective when there are some unforeseen changes in stated plans.
• Economic : It should be made sure that the benefits derived from the system should be more than the cost incurred from the control system.
• Understandable : The whole process should be clearly understood by everybody involved, especially managers. Its only then that control will be effective in the organization.
• Corrective : A proper control system should not only detect deviations from plans, but must also show the way to corrective action so that further loss or damage are not caused in the organization.

Following are the steps to be followed by any organization before things go out of control:
• Establishment of Standards : Control logically begins with setting up of standards. These provide the established criteria of desired performances for evaluating both individual and organizational performance. The criteria of desired performance vary according to the nature of business activities. Whatever standards may be set and used, they should be appropriate to the purpose attainable, flexible, precise and concerned with results rather than with procedures. Standards should also not be vague and should be understandable by all the persons concerned.
• Measurement of Actual performance : This is done for the purpose of evaluation. Measurement of actual performance should be done as accurately as possible. Technical kind of work can be measured easily but difficulties will arise where less technical kind of work are concerned. Managers and supervisors should adopt suitable methods of performance appraisal.
• Comparison Step: After the standards are set and performance is accurately measured, the next step is comparing them to see any variation between the two. When actual performance is equal to expected performance there is not much need for controlling action. This is an ideal situation, which rarely exists. In case of difference between actual performance and the desired performance, the manager should use his judgment to determine the significance of this difference.
• Corrective Action : Control process would be incomplete if corrective action is not taken. As Connor observes, “An effective control system should produce more than a red flag; it must also contain procedures to determine means of correcting the deviations:. Corrective action calls for the removal or adjustment of causative factors, with a view to put in the performance on a proper track. Also, corrections should be undertaken promptly as soon as deviations need correction. Such action may be either remedial (which is taken after the wrong has been done) or preventive (which is taken before). It is obvious that the latter is preferred to the former. Those having the authority over the actual performance put the corrective action into effect. As such, the control process ends with such proper corrective action.

Q.6 Write Detailed notes on (A) Delegation of Authority. (B) Barriers to
communication & principles of effective communication.

Q.7 Define decision making. Prepare list of factors that affect decision making
process.

Decision making is the process of generating and applying criteria to select from, among
seemingly equal alternatives.
Five steps of decision making are:
• Identifying the problem
• Collect information from all possible sources
• Generating alternative courses of action
• Evaluating the alternatives
• Selecting the best alternative
• Implementing the decision
• Follow up and review
Factors affecting the Decision making process are:
• Information ( it must be available, authentic, adequate, reliable must be available at the right time. It must be analyzed and presented in the right manner).
• Time factor : Decision must be taken at the right time. Some products are introduced ahead of time. For e.g.Dish washers introduced in India. Decisions are also time bound. In business, context, introduction of air-conditioners, coolers and refrigerators in summer and woolen clothing in winter also suggests the influence of time in decision making.
• External environmental factors : As decision making is always interactive with the environment, various environmental factors influence decision making such as economic, political, social, cultural, technical, ethical, legal, global factors.
• Internal factors : Rules, regulations, procedures within the organization or administrative restrictions also affect decision making.
• Personality of the decision maker or Subjectivity : The decision making process has a lot to do with who is the decision maker, his attitudes, perceptions, values, style of functioning, the nature of personality and overall way of thinking.
• Participation, Acceptance and Implementation : Elements of how decisions are taken, how far they are accepted and how they are to be implemented also contribute in the decision making process.
• Precedent : In a bureaucratic set up this becomes a ruling factor as question like “ Have we done this before?”, “Is there a precedent of taking such decisions?” are often asked before taking a decision.
• Experiences of a Decision Maker : As it is said that experience is the best teacher, maturity in business experience of a manager go a long way in taking effective decision.
• Power to decide: Many times, people know what is wrong in the organization, but often they do not have the power to decide and act. That is how the concept of empowerment is evolved which talks about decision making to the lowest possible level.
• Escalation of Commitment (Point of No-return) : After decision has been taken, it is often felt that the decision is going in a wrong way, but more than half of the work is completed. Therefore, there comes a point of no return and the decision has to be completed in spite of negative feedback.
• Bounded Rationality : Constructing simplified models that extract the essential features from the problems without capturing all their complexities. The decision maker settles for the easy solution that is good enough. In layman’s language, decision maker finds out the earliest available alternatives, takes certain things for granted and acts on it. The decision maker takes generalized judgmental shortcuts which are also called Heuristics. For e.g. if two students from a particular management institute show exemplary performance in the job, the judgmental shortcut is “every student from this institution is good”, and vice versa.
• Problem perception : Problems that are visible catch a decision makers decision. These problems become the first to be acted upon, or a priority. For e.g. if at the time of the chief executive officers(CEO) visit, workers start agitating, then this agitation becomes the main problem for the CEO because it is visible for him.


PART B (Any five)

Q.8 “Services Sector is India’s new economy” critically comment. What are the
general management challenges in Services Sector? (Support your answer with
corporate examples)

Q.9 Write a detailed note on Retailing sector in India – Growth prospects & various
challenges.
The retail sector in India has been quite staid and boring, but it is now coming alive and boom is just around the corner. The Indian retailing is estimated to be $180 billion, with organizes sector representing only 2% share of this market, mainly concentrated in the metropolitan cities. India is the last large Asian economy to liberalize its retail sector. Hence, the scope for retailing in India is great, as it is completely dominated by the unorganized sector. In Taiwan, the retail industries are estimated to be around $40 Billion, with organized sector representing 81% share of this market.
Obstacles for retail development in India :
Reasons for Indian consumer’s shying away from large formal stores and super market chains
1. Poverty and low literacy levels
2. Low per capita income
3. No exposure of big stores to media
4. Poor infrastructure facilities like roads, transports etc
5. Restrictions on intrastate goods movement
6. High taxes
7. High import duties on imported goods
8. Expensive supply chains
9. Focused savings and the high bargaining interests of the consumer
10. Licensing policies, which were restricting
Hence, India has been experiencing the unique strangle – hold of our traditional kirana stores and for generations, people have been shopping from the same kirana stores. Keeping in mind that retailing is the second largest employer after agriculture and that $180 billion worth of goods is retailed every year we have to slowly change our mindsets and fortunately a number of favorable factors are coming our way which will help further development of retail sector in India. These factors are:
1. Rising income and a slow but steady rise in literacy rate.
2. Rising per capita incomes
3. Improvements in infrastructure, like roads, transport, financial institutions etc.
4. Liberalization of market for consumer goods, which has helped multinational companies to make in-roads into India.
5. Reduction of customs duties
6. Shifting consumer preferences to foreign brands. Eg. Mc.Donald, Sony etc.
7. Internet is making the consumer more accessible, acting as a link.
8. Awareness being created by satellite TV channels about global products.
Challenges faced by the retail business
1. Looking beyond Price : Price is certainly an important factor in the customers decision making, but it will be self-defeating to believe that all customers are looking for price and price alone. There is a segment of customers who look beyond price for others like service after sales, product reliability, a pleasant shopping experience, cordiality of sales-persons, adherence to commitment etc. As this segment of customers is growing fast, the retailer will do well to concentrate on these factors.
2. The people factor : To deal with this challenge, training and development of these sales team at all levels is essential. They need the right skills and should be evaluated and challenged each day. This training should not be once every year or so, it should be an ongoing part of business.
3. The cultural aspect : This issue has twin factors to it:
• On the one hand we have to learn to accept and deal with people coming from very diverse background and working under the company’s corporate culture
• On the other hand you have to understand the culture of the multinational who enter our country and produce top quality goods and are also entering the field of retailing itself. We have to find a common ground to work with them.

4. The technological edge: Technology would have a much bigger role to play in retailing than its current role. For e.g. what kind of systems do we need to develop? With technologies changing everyday, what should be the budget for these systems? How do we retail people with software and technical skills, who have the whole world open to them?
5. Giving value to the customer: The entails anticipating customer expectations and fulfilling them effectively. We must remember that the greatest education happens on the showroom floor. Hence the manufacturer and the retailers must communicate with the consumers jointly.
6. Special mindsets to develop special strategies: Emerging markets and consumers are very well developed along some dimensions and totally new among others. For e.g. A friendly neighborhood retailer understand the business of customer relationship management very well, but is totally innocent about the strategies about say how to capture supply chain surpluses.
7. Exploiting the talent potential for new products and services: We need to understand and internalize that market opportunities in India is strategy development, on finding the right keys. The structure of consumer demand in India is like an iceberg – we see only parts of ready potential on the surface. The real challenges is to find appropriate offers that can unlock a vast talent potential. For e.g. Ruff and Tuff ready to stitch jeans unlocked the huge potential which Levi’s could not.
8. Coping with the change: Brands are no longer products – they are associated with life styles and peoples aspirations. One of the challenges is not to fear change but to encompass it and lead the process of change through the organization.

Q.10 “Management consultants are creation of liberalization in India” offer your
views on this statement & comment on the role of consultants & their
limitations.

Q.11 “Event Management is the biggest challenges for professional Manager”
discuss fully.

Q.12 Write notes on (A) Indian Management thought (B) Importance of Business
ethics.
(A) Indian Management thought :
“We may borrow technology from other countries but we should never borrow management practices” . This is the lesson we learnt after the western thoughts effected our organizations in negative way
This lead us to explore information about Indian management thought and practices.

Mordern Indian thought on Management has its root in the ancient Indian philosophy of Vedanta.
Indian philosophy deals with life and existence of self and realization of self and attainment of
fearless bliss or pure consciousness is its ultimate objective.
• Kautilya was the mentor and advisor of Chandragupta Maurya who wrote “Arthashastra” in 321B.C. It is based on political, social and economic management of the state
• Sukracharya’s “Shukraniti” emphasized that the king as a head of the state had to be virtuous and self-disciplined for he was chiefly the creator of social progress and prosperity.
• The king Akbar insisted upon setting the goals and accomplishing it by every possible thing.
• Samartha Ramdas contributed much to the conception of Administration and Management and his advice to Shivaji.
• Swami Vivekanand mentioned that everybody has a divine power to face challenges.
These are isolated examples of management thought. The consolidated theory of management with its universal application was not developed then nor was the management introduced as a part of any educational curriculum
Thinkers in India now started evolving management practices best suited to Indian ethos. They have turned to Indian Philosophy to ancient Indian Scriptures to seek the required guidance. Thus, the Indian management thought is emerging slowly but surely.
Many eminent people and institutes are working on this. The common basis of their management education is realization of “pure consciousness” which is the ultimate goal of the Human Activity
Some of them use :
• Transcendental Meditation
• Yoga
• Sadhana
• Patanjali Yoga Sutra – which insinuates the message of commanding oneself before directing others.
To get over tensions and stress one must practice the “yogic” exercise that consist of “
• Abstinence
• Observance
• Posture
• Breath Control
• Withdrawal of senses
• Concentration
• Meditation
• Super-Consciousness
Distinctive points about Indian ethos:
Model I
1. Balance is the keynote of Indian thought. It tries to maintain balance between short term goals of material achievements and the ultimate divine perfection.
2. Indian thought takes the individual as a central focus. If I am good, then the world is good
3. Indian thought does not consider any work as inferior or demeaning. Work is considered not only as a means to gain name, fame or power but to purify our minds and ego and take us towards the attainment of bliss.
4. Knowledge in Indian thought speaks about two fundamental categories: Creator and Creation. Indian thought tries to seek knowledge about the creator rather than the creation. The different yogic processes, social norms and values help us in transforming our minds and enables us to establish contact with the creator.
Model II
The word of management is changing to “knowledge management” physical work is being replace by the mental work. The pressures of the managers of today are tremendously increasing. Modern techniques like anti-depressants cannot help or are not the right way to get rid of this stress. Things which can help are some of the philosophies given by our encient forefathers….Like Vedanta, Vipassana, Meditation, Yoga etc.

(B) Importance of Business ethics :
Business ethics means study of good practices for business.
Key ethical principles include the following:
• Honesty
• ?Integrity
• Fulfilling commitments, abiding by agreements in letter and spirits.
• Being fair and open minded and willing to admit error
• Caring and Compassion
• Respect for human dignity
• Responsible Citizenship
• Pursuit of excellence
• Being accountable for decision and their consequences
Unethical act are result of three factors:
• Unawareness and insensitivity to issues
• Selfishness
• Faulty Reasoning

Ethical Concepts : Some fundamental ethical concepts are :
Ethical Subjectivism : Ethical Subjectivism argues that what is ethically right or wrong for an individual depends on Ethical Principles he or she has chosen
Ethical Relativism : Ethical Relativism argues that there is no universal set of principles by which to judge morality. Each society has its own rules and it is inappropriate to compare the ethical rules of one society with another. What relativism does not consider is that there may be sufficient evidence to believe that an ethical practice is based on false belief illogical reasoning etc.
Consequentalism : There are two central ideas associated with consequentialism. The first idea is the concept of value and second that of maximization of value. Thus, if happiness is considered a value, an act is ethical only if it maximizes value. An act which does not maximizes value is not ethically permissible.
Deontological Ethics : Deontological ethics emphasizes that all mature persons have adequate capacity to reason and ethical rules can be derived from the concepts of reason. We may will to do good and inadvertently cause evil. Similarly, we may will to do evil and may end up causing good. Thus the moral worth of an action cannot be defined by it’s consequences. If a person acts from a good will, then the action is moral.
The ethics of Virtue : This concept tries to explore the traits which helps the person to lead a life that is satisfying from an ethical point of view. Virtuous acts are done willfully and not by chance. Examples of virtues include courage, tolerance, generosity and honesty.
Ethical dilemma’s in business : Ethical problems result in dilemma’s for managers because they represent conflict between an organization’s economic performance and it’s social performance.
Since business run by people , it is important to ensure ethical behavior at an individual level only then collective actions of individuals, can result in ethically correct responses from the organization as a whole.
Whistle Blowing : Whistle blowing may be defined as the attempt of an employee to disclose what he or she believes to be wrongdoing in or by the organization.

Q.13 What are the problems faced by Indian Business families after 1991?
(Beginning of liberalization in India)
Following are some of the problems faced by business families after 1991:
1. Transnational attack
2. Stiff Competition
3. Low profiles
4. Fickle Consumers
5. Unproductive Labor
6. Falling Share Values etc
In spite of these, everyone of them has expanded its range of business activities. This is so because
1. These Corporate have a sound knowledge of the tastes of Indian Consumers
2. These Corporates are much more practically savvy and they know how to maintain political links
However, business family owned business also face major fears.
1. Splits like a clash between father and son or other members of the family leading to division of the company. For e.g. the Birla groups division into many companies after the death of MR.G.D.Birla
2. Successful planning to get the right person at the right place after the business pioneer retires or expires. The rules have changed after liberalization and the successor needs to have the right qualification or the corporate needs to outsource a person from outside the company, thus restricting the family’s control on the business.
3. Lack of focus where the companies need to focus more on their areas of core competence and selling of non-revenue generating companies. For e.g. Tata selling TOMCO to HLL.
4. Transnational Attack : Foreign companies are more focused, organized, able to bear shots and they pose a threat because of their global threats of product and service quality.
5. LPG(Liberalization, Privatization and Globalization): Today’s Entrepreneurs are having such huge opportunities only because of multinationals but the timing of globalization can be debated on. According to Mr.Shashikant Ruia (CEO, ESSAR Group) – “ the way the country was opened up to foreign competition was unfair, but it has to be faced up to by family business with a new set of strategies”
6. Stumbling self confidence: In the beginning, Indian business houses were not able to take courageous decisions because of their confused states.
7. Difficulties with restructuring: The changed circumstances required a great amount of change, but for most of these business houses change was painful, expensive and forced. Very few could change from within, due to lack of initiative taking ability.
8. Take Overs: since most of the Indian companies are neither technically nor financially sounce, they are always under threat of takeovers
9. HR issues: Retaining the Indian brain is a major difficulty of Indian companies. They have to:
• Tap the untapped human resources
• Give them industry standards pay packages and other remuneration
• Emphasis on overall personality development through training and exposure
• Offer them proper career path
• Delegate authority to them
• Give them space to work
10. Lack of professional management and clashes between professional CEO’s and family members who control the business. Separation of ownership from management is always a debatable issue in such companies, though the need for appointing a professional manager is widely accepted, problems arise in terms of clashes of styles and approaches towards running the company. Today however these families have to change their approach in order to remove the redundancy in the system and in view of the liberalization in market place, Indian business houses have to undergo radical strategic operational and financial transformation and most importantly, they must rewrite the role of the family. The families have realized that the family and the business are essentially two separate institutional systems with distinctive rules governing the respective behaviors they have began to appreciate this distinction. They have also made certain vital changes over their future role to make the family business survive.

Some of the strategies adopted by business families for their survival and growth :
1. Raising their capital state to a comfort zone so that the fears of take over can be kept at bay: preliberalization, many families were running the business with a low capital state of 15 to 20 % which made them vulnerable for takeovers. Post liberalization, families like Tatas, Ambanis, Singhanias have raised their stake to 26% on above and in many cases as high as 45 to 50 % to gain complete control over the management of the company.
2. Consolidation of business by selling of non viable and non core businesses such as Raymonds sold their steel division to Thyssen of Germany and cement division to Lafarage of France. Even Tata steel sold their cement division to Lafarge to concentrate on Steel business.
3. Appointment of professional managers: Business families have realized that business should run by experts and specialists and the concept of capital stake and managerial stake should be clearly defined. So many business houses are taking back seats and professional managers are running the show.
4. Attention and investment in research and development: Sp far R & D was neglected by Indian Business families. But companies have realized that creativity, innovation, new product launch, improvement in quality bringing down costs are the survival strategies of tomorrow. So business families have started spending more on R & D. For e.g. Ranbaxy Pharmaceuticals, Dr.Reddy’s lab, Mahindra & Mahindra.
5. Joint ventures and Tie ups: With globalization and government rules an regulations, moving ahead requires strategies like joint ventures. For e.g. Hero and Honda of Japan, Bajaj having technical collaboration with Kawasaki of Japan etc.
6. Technology upgradation and managing the pace of change: Technology today is moving at the speed of internet. Most of the companies have realized that managing understanding and adapting to changes are the challenges they have to face and business families are readying themselves for this.
7. Understanding the realities that economies are moving from seller market to buyers market. Business families earlier took customers for granted. Post liberalization, the consumer has wider choice of products. Business families have adapted themselves to the new product launch, customer relationship management, reliable after sales service have become the benchmarks of the new strategies.
8. Profit will not come from cornering licenses or beaurocratic favors but by being competitive at the market place. This realization has resulted into giving weight age to the performance of managers over loyalty of managers towards families.
9. Succession planning : Professional management is an attitude and mindset. Many business families scions are educated, are trained abroad and they return to take over. They begin at the grass-root level to gain experience. A senior family member and trusted professional manager acts as mentor for them. As soon as they are ready to take over, they enter the board room with confidence.

Q.14 Define emotional Intelligence. Explain its importance for a Manager.
Emotional Intelligence can be defined as the ability to reason with, and about emotions. Emotional
Intelligence combines feelings with thinking, and thinking with feeling.

"The ability to accurately interpret & appropriately manage emotional dynamics in oneself &
others . . . in ways that enhance well-being & success."
There are five components of Emotional Intelligence:
Self-Awareness
This is the ability to understand and recognize your own behavioral and emotional patterns and moods. A person who is self-aware will control the effects of his own emotions so that they have a positive effect on those around him. He is not hard on himself, or on those around him. Rather, a person with good self-awareness is honest to himself and others, and accepts and understands his strengths, weaknesses, needs, wants, and motivating factors. People who are aware of themselves and their emotions do not let their emotions get the best of them. If this happens, job performance, relationships, and other areas of their lives will be affected. People with self-awareness know how to harness their emotions into something positive instead of using them to let off steam and get further frustrated. Self-aware individuals are also highly motivated, and are headed down a solid and defined path. They are not flying by the seat of their pants, with no end goal in sight. They find it very easy to discuss their emotions without getting uncomfortable, and they can also talk about their strengths and weaknesses with others, thus allowing them to focus on these strengths and weaknesses and make corrections as needed. They take constructive criticism well, and take calculated risks by making educated decisions.

Self-Regulation
Goleman describes self-regulation as “the component of emotional intelligence that frees us from being prisoners of our feelings.” Self-regulation is similar to self-awareness in the fact that both have to do with the effects of emotions on self and others. However, while self-awareness deals with recognition of different emotions and the effects they do or can have on others, self-regulation deals with monitoring the output of those emotions and controlling them so that they can be turned into something productive. Being reasonable is a result of self-regulation, and thus people will be more willing to deal with a person who is self-regulated. Goleman says that people who are self-regulated are “able to create an environment of trust and fairness.” Self- regulation also works in what is known as a “trickle-down effect.” By being a self-regulated leader, others will catch on and act in the same rational and calm manner when dealing with conflicts because they don’t want to be known as the person who can’t handle problems reasonably and rationally. Self-regulation also helps in instances of competition. It is easier to adapt to new climates and get to know new surroundings if one is self regulated. Another reason for people to adopt the virtue of self-regulation lies in decision-making. If a person is not self-regulated, he will not be able to clearly think about the decision and weigh all the alternatives. This could result in a brash decision, causing more harm than good for his organization. By regulating his emotions, he could make a much more educated and calm decision, which would most likely result in the right move for the company. Goleman tells us that when it comes to decision-making, the signs of a self-regulated individual are reflection, thoughtfulness, adaptation to change, and integrity.

Motivation
Motivation is the one key personality characteristic that all good leaders have. They must be able to get people excited about their job, get them ready to work, and make them want to achieve the highest possible success through their efforts. Goal setting is a part of motivation. If the bar is set high, people will strive harder to achieve it. However, the bar cannot be set so high that it is unattainable. Once employees see that they can achieve goals and find good success through their efforts, they will be more faithful and committed to the organization. This also translates into higher retention rates, because committed employees will not search elsewhere for a new job, even if the salary elsewhere might be higher. If a person strongly believes in an organization that she is part of, she will not want to leave that organization and her teammates behind.

Empathy
The fourth component of emotional intelligence is empathy. It is the most easily recognized component because it is easy to see the harshness of someone who doesn’t understand, and even easier to see the compassion of someone who does. However, in the business world, empathy isn’t a mushy, touchy-feely idea. Trying to please everybody is not the key with empathy in this sense. Instead, Goleman writes, it concerns taking into account the feelings of others and other factors when making important and educated business decisions (Goleman 1995). He says that empathy is an important component of EI for these three reasons: the increasing use of teams, globalization, and retention of talent. If a team leader can understand all of the contrasting views, emotions, and opinions of the other team members, the team will function much smoother, and synergy will increase. In the area of globalization, empathy of different cultural norms can only help business. Many times, miscommunication occurs between people of different cultures. Consequently, business suffers and amiable relations between partners dwindle. By being empathetic to different cultural norms, relations are kept in good standing and more business is conducted, which helps both parties. Finally, by being empathetic to employees, companies will retain more of their talented workers because the workers will feel more respected and taken more seriously by managers. As you can see, the use of empathy provides a win-win situation for everyone involved.

Social Skill
The fifth and final component to emotional intelligence is social skill. According to Goleman, it is “the culmination of the other dimensions of emotional intelligence.” If a person is adept at social skill, he is very good at persuading people to act or believe in a certain way (a manifestation of self awareness, self regulation, and empathy combined), and he will also be an outstanding team leader (which exhibits the use of empathy). People who have good social skills are also great motivators because the people who work under them respect them. Social skills allow an employee to make connections and network her way across or outside of the company. By making acquaintances, it is easier for individuals to find out where to get certain things that they will need in the process of performing their tasks. They will become more successful in their jobs by expediting the time it takes to perform those tasks since they know where to find all of the resources they need to tap into
Leaders who do not have Emotional Intelligence create negative outcomes and often:
• Discourage creativity
• Repel the best employees, managers and customers
• Do not take signals from themselves or others
• Make problems and conflicts out of incidents
• Make decisions based on limited information
• Jeopardize communication and trust
Their egos get in the way of their actions and inappropriately affect the consequences. Moreover, conscious and unconscious feelings run their lives but they do not know it.
Consistent with demands of the "new economy" Emotional Intelligence is an important part of creating lasting relationship to customers, suppliers and employees. Leaders with high Emotional Intelligence create positive outcomes and:
• Retain and motivate their best employees
• Are effective in team outcomes
• Build lasting customer relationships
• Deal with conflict in constructive ways
• Pick up on signals
• Are open to different options
• Capitalize on their own strengths and the strengths of their people
• Make choices based a broader perspective
• Accept responsibility for managing their emotions
• Practice authentic and honest communication
• In short, they utilize the information and power of their emotions
To develop your Emotional Intelligence is very demanding but the payoff is great. Conclusion:
Your feelings are important and help shape leadership results. Pay attention to your feelings. What do they tell you? How do you decide to manage them? Do you feel them fully? Write them in a journal to see them objectively. Do you use them actively to check out which choices feel the best to you in making decisions? If you do, you would rate at the top of the leadership scale. If you don't, you are not using your Emotional Intelligence.
Your IQ is not enough anymore. Leadership and learning are inseparable and Emotional Intelligence can be tapped, emotional skills can be learned.
Emotional intelligence is important for everyone, but for managers it is a must.

Q.15 Write a detailed notes on (A) Strategic Business Units (B) Corporate
Governance.
• Strategic Business Units : SBU is a collection of product divisions that produce related or similar products. Supports related diversification because similar products that are grouped together share a common underlying technology, market, skill or resource.
A relatively independent business with coherent set of products, strategies, objectives and competitors. Many large corporations consist of a number of SBUs.
Forming SBUs has been popular in the 1990’s and one of the earlier user of this organizational device was the General Electric Co.
In 1995, Mindscape, a rapidly growing developer and publisher of software, created SBUs to handle product development for each of the segment like child, youth entertainment etc.
Recently Ranboxy started a SBU to promote its old brand products.
Complanies have been using an organizational device generally referred to as a SBU.

SBUs are distinct little business setup as units in a larger company to ensure that a certain product or product line unprompted and handled as though it were an independent business.

To be called an SBU, a business unit must meet specific criteria
o Have its own mission distinct from the mission of other SBUs
o Have definable group of competitors
o Prepare its own integrative plans, fairly distinct from those of other SBUs
o Manage its resources in key areas
o Have a proper size neither too large not too small

The Concept of SBU :
o A scientific method of grouping the business of a multi-business corporation, which helps in strategic planning
o An SBU is a group of related businesses that can be taken for the sake of strategic planning distinct from the rest of the businesses.
o Products/businesses within an SBU receive same strategic planning treatment and priorities
o The task of analyzing and segregating the assortment of the business portfolios and then regrouping them in to separate independent entities
o Products/Businesses are related from the stand point of the function are assembled as a distinct SBU.
o Unrelated products and businesses are separated.
o Grouping of the businesses on the SBU lines helps in strategic planning
o In basic factors like mission, objectives etc one SBU is distinct from the other
o SBU will have its own set of competitors and own distinct strategy
o Each SBU will have its own CEO
Advantages of SBUs:
• Minimize problems associated with sharing resources across functional areas
As firms diversify into new product market activities, single functional departments are unable to manage the increased complexity of overall business. To address this problem, SBUs areorganized around certain products or markets and each focuses on its own particular issues. The problems of sharing resources across functional areas are removed
• Quick response to environmental changes
Since decision – making authority for the SBU is delegated to each person heading it, it can adapt quickly to any environmental change.
• Increased focus on products and markets
Managers concentrate on their own particular product lines or markets. They have access to resources and staff functional specialist. The efficiency of a company pursuing unrelated diversification strategies generally improves if SBUs are formed SBU managers tend to be closer to their customers and their customer knowledge shapes the planning.
• Facilities development of general managers
As organizations increase their products – market diversity, the demand for general managers increases. Individuals with ability to comprehend and integrate the activities if diverse functional areas are needed. SBUs facilitate the training and development of general managers because these managers are given authority for formulating and implementing strategy and are held accountable for the results. Many corporations use this type of management development to effectively groom their rising general managers.
• Increases strategic and operational control permitting corporate level executives to address strategic issues
Operational decision making in a large business places excessive demands on the firm’s top management. If the top-level managers are to attend to broader, long time organizational issues, they must delegate decision making to lower level managers.

Disadvantages of Strategic Business Units :
• Increased costs incurred through duplication of personnel, operations and investments
Initiating and maintaining a divisional structure increases costs along with the number of personnel and overhead expenses. Duplication of administrative functions and the attendant operating and capital expenditure takes place.
• Difficulty in maintaining a uniform corporate image
In some instances, using a single company trademark or brand can enhance the perceived value of new or poorly performed products by transferring them identifiably and customer loyalty of stronger products to them. In other cases however a single defective product that is associated with customer dissatisfaction can damage the reputation of a company’s entire line
• Over emphasis on short term performance
Intense pressures placed on SBU mangers to meet short term return on investment targets and
to contribute to earnings per share have often fostered a lack of concern for expenditures with slower paybacks such as investment in research and development and marketing research.
• Distortion of Information
With an additional hierarchical level, information may be distorted and communications slowed as corporate managers are farther removed form individual decisions and they may even be unaware of significant developments that could impact the corporation.
(B) Corporate Governance :
Corporate Governance is the term given to the management practices followed by the business. Organizations, which aim at, better transparency, ethics and accountability.
Corporate governance has succeeded in attracting a good deal of public interest because of its apparent importance for the economic health of corporations and society in general. However, the concept of corporate governance is poorly defined because it potentially covers a large number of distinct economic phenomenon. As a result different people have come up with different definitions that basically reflect their special interest in the field. It is hard to see that this 'disorder' will be any different in the future so the best way to define the concept is perhaps to list a few of the different definitions rather than just mentioning one definition.
"Corporate governance is a field in economics that investigates how to secure/motivate efficient management of corporations by the use of incentive mechanisms, such as contracts, organizational designs and legislation. This is often limited to the question of improving financial performance, for example, how the corporate owners can secure/motivate that the corporate managers will deliver a competitive rate of return"
“Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment”
"Corporate governance is the system by which business corporations are directed and controlled. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the corporation, such as, the board, managers, shareholders and other stakeholders, and spells out the rules and procedures for making decisions on corporate affairs. By doing this, it also provides the structure through which the company objectives are set, and the means of attaining those objectives and monitoring performance"
"Corporate governance - which can be defined narrowly as the relationship of a company to its shareholders or, more broadly, as its relationship to society -…."
Aspects of Corporate Governance
1. It is almost a truism that the adequacy and the quality of corporate governance shape the growth and the future of any capital market and economy. The concept of corporate governance has been attracting ‘public attention’ for quite some time in India. The topic is no longer confined to the halls of academics and is increasingly finding acceptance for the relevance and underlying importance in the industry in the capital markets.
2. Firms in India and abroad have shown the markets and investors take notice of well managed companies, respond to them, and reward such companies. A common feature of such companies is that they have systems in place which allow sufficient freedom to the boards to take decisions towards the progress of their companies, to innovate, while remaining within a framework of effective accountability. In other words, they have a system of good corporate governance.
3. Strong corporate governance is thus indispensable to resilient and vibrant capital markets and is an important instrument of investor protection. It is the blood that fills in the veins of the transparent corporate governance disclosure and high-quality accounting practices. It is the muscle that moves a viable and accessible financial reporting structure without financial reporting premised on sound, honest numbers, capital markets will collapse among themselves.
4. Another important aspect of corporate governance relates to issues of inside trading. IT is important that insiders, which include corporate insiders also, do not use their position of knowledge and access to inside information, to take unfair advantage over the uninformed stockholders and other investors transacting in the stock of the company. To achieve this the corporates are expected to disseminate the material price sensitive information in a timely and proper manner and also ensures that till such information is made public insiders abstain from transacting in the securities of the company. The principle should be disclosed or diesis. This calls for companies to devise an internal procedure for adequate and timely disclosures, reporting requirements, confidentiality norms and code of conduct for its directors and employees with regard to their dealings in securities. However the need for such procedures, rules and guidelines also goes beyond corporates to other entitles in the financial markets such as stock exchanges, intermediaries, financial institutions and other professionals who have access to inside information. This also needs to be dealt within a comprehensive manner.
5. The comities recommendations look at corporate governance from the point of view of the stakeholders and in particular that of the shareholders because they are raison deter for corporate governance and also the prime constituency of SEBI. The control and reporting functions of boards, the roles of various committee of the board, the role of management, all assume special significance when viewed from this perspective. The other way of looking at corporate governance is inform the contribution of corporate governance to the efficiency of the enterprise to the creation of wealth and to the county’s economy. In a sense both these points of view are related and during the discussions at the meeting of the committee, there was clear convergence of both the points of view.
6. At the heart of the Committees reports is the set of recommendations, which distinguishes the responsibilities, and obligations of the boards and the management instituting the system of good corporate governance. A large part of the recommendations are mandatory and are intended to be enforced on the listed companies for initial and continuing disclosures in a phased manner within certain specified dates.
Tools for Corporate Governance
• Proper functioning of the board
• Trust
• Audit
• Professionalisation
• Communication
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Re: management questions - November 1st, 2008

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Re: management questions - January 16th, 2016

Quote:
Originally Posted by sandyraj View Post
PART A (Any five)

Q.1 "Management is a combination of Arts, Science & Profession" Explain fully.

Management is collection of different activities such as Planning, Organizing, Controlling, Directing and Coordinating. These activities should be supported with good leadership quality, good communication, motivation and morale. Management is getting work done through and with other people. This requires lot of efficiency and combination of different qualitative. A good manager should have artistic qualities, manager should be aware of social - science and manager should be a thorough professional.

Management's lot of features can be compared with features of Art.
a) Art requires skill.
A good management is a combination of Conceptual, Technical, Human
Relations and Decision making skills. Without skill Art is not there, similarly
Without Conceptual, Technical, Human Relations and Decision making skills
nobody can become a good manager. Without these skills management is nothing
but failure.
b) Art requires knowledge.
A good manager should have learning and acquiring knowledge. The knowledge cannot be limited to just one domain, they have to have the knowledge of Marketing, Finance and Production. A good manager should be open to learn and he/she should have a good analytical skills.
c) Art is Creative
A good manager should have creativity. Manager should be able to come up with new ideas and new products to facet the new challenges of competition. Manager can motivate his employees through his/her creativity. Management can be successful if the manager is creative.
d) Art is personalized
Each person is unique and similarly each manager is different and their way of approach is different. A manager can be Democratic, Autocratic, Paternalistic and Bureaucratic. Success of management depends on the manager’s way of approach to the situation.
e) Art is performance.
We cannot judge an art as good or bad easily. It is relative/subjective. An art, which is good for one person, can be bad for the other person. Similarly management cannot be judged based on only profit, growth, development and market share. Through these we can only understand management as concept. So to judge a management as good or bad apart from the above-mentioned factors various other performance indicators are also required.

Management can be compared with Science – Social science
a) Science is a body of organized knowledge
Without an organized knowledge management is a failure.
b) Science is developed over a period of time
The concept of management is not new. It is evolved over a period of time. It has gone through revolutionary changes time to time.
c) Science establishes cause and effect relationships.
A good management can effect the relationship in a positive manner and it will be responsible for the good cause of the organization.
d) Science has predictive power.
A good manager is one who has good predictive power. The manager has to fore seen the situation and take necessary actions.
e) Rules/Regulations in Science are verified time to time. Old rules are challenged, new rules are established
Management approach is changing periodically. Management adopts new rules based on the situation.
f) Science of two types: Perfect science like physics/chemistry/mathematics and Social Science like management.
Management is based on assumptions and presumptions also. The assumptions like market may change, product may click in the market etc makes management a social science.

Management can be compared with Profession.
Theoretically and Academically management is developed towards profession. We have to compare characteristics of profession with that of management.
Profession : Any discipline to be called, as profession must fulfill the following conditions.
1. It requires definite period of learning
2. It has centralized rule making authority
3. It has enforceable code of conduct
4. Membership through acquired qualification and approval
5. It needs certificate of practice
6. Social commitment/obligation/accountability
To call Management as a profession,
1. Many organizations prefer individuals with MBA, DBM qualifications for the post of a manager. Though this is not a must, this has got definite period of learning.
2. Though there is no centralized rule making authority, there are a number of parent bodies in specialized functional areas such as Institute of Marketing Management, Institute of Materials Management, National Institute of personal management and so on.
3. These parent bodies can publish desirable code of conduct, but that can not be enforced as law in management.
4. Individuals born in business families get ownership right/management right mainly due to law of inheritance. It is irrespective of qualification they hold.
5. There is no legal definition of the term manager. Management as a discipline does not require any certificate of practice.
6. Managers do have social commitment/accountability/obligation. This is part of social responsibilities of management. These responsibilities are desirable and not enforceable under every law.
The term ‘Profession’ or ‘Professional Manager’ has got different connotation. This approach is very close to practice of management. This approach clarifies role of profession manager as well as who can be called as professional manager.
Based on all these factors,
Management is not just a process
Management is not just a list of functions
Management is not just Arts and Science
Management is and should be way of life.


Q.2 “Planning can not eliminate risk but can minimize it”. Explain this statement
with reference to the limitations of planning. Also write a note on the various
strategies adopted by Indian Companies to stay ahead of competition.


Q.3 What are the different types of motivators? Explain Maslow’s theory of
hierarchy of needs. Why study of motivators is important to manager?

Motive is a desire that impels a person to a certain behavior.
Motivation can be observed in the following Needs - satisfaction chain


Needs give rise to
|
Wants
|
Tensions
|
Drives or Action
|
Satisfaction or Dissatisfaction
In this chain every step is the motivator.

Following are the different kinds of motivators:
• Financial (Everything related to money, example: Salary, Perks)
• Non financial (Encouragement, Freedom, Recognition)
• Positive (Rewards, Incentives)
• Negative(Fear, Compulsion, Force)
• Internal (Individual inner drive, Urge)
• External(Individual doing it for someone)
• Open and hidden (Hiding the status which results in bad consequence.
• Ethical (Honesty, Integrity, Hard work)
• Unethical (Most debatable types as it suggests corruption as source of motivation. If dishonesty is rewarded can it become source of motivation?)

List of general motivators:
• Good pay/salary
• Promotion, Regular increment
• Job security
• Interesting work
• Competent supervision, Leadership
• Friendly and helpful co-workers
• Clearly defined goals and expectations
• Authority
• Enough information
• Opportunity to see results of work
• Enough help and resources
• Performance based incentives
• Equality and fairness at workplace
• Family priorities and Demands
• Proper communication
• Level of confidence shown by superior
• Organizational policies, rules, systems
• Challenges in the job/responsibilities assigned
• Individual’s performance to list of satisfiers such as money, status, social standing, recognition etc.
• Freedom at workplace.
This list changes as per time, workplace and nature of job.

Maslow’s hierarchy of Needs:
Human needs are an important part of human nature. Values, beliefs, and customs differ from country to country and group to group, but all people have similar needs. As a leader you must understand these needs because they are powerful motivators.
Abraham Maslow felt that the basic human needs were arranged in a hierarchical order. He based his theory on healthy, creative people who used all their talents, potential, and capabilities. At the time, this methodology differed from most psychology research studies which were based on the observation of disturbed people.
There are two major groups of human needs: basic needs and meta needs.
Basic needs are physiological, such as food, water, and sleep; and psychological, such as affection, security, and self esteem. These basic needs are also called deficiency needs because if an individual does not meet them, then that person will strive to make up the deficiency.
The higher needs are called meta needs or growth needs. These include justice, goodness, beauty, order, unity, etc. Basic needs take priority over these growth needs. People who lack food or water cannot attend to justice or beauty.
These needs are listed below in hierarchical order. The needs on the bottom of the list (1 to 4) must be met before the needs above it can be met. The top four needs (5 to 8), can be pursued in any order depending on a person's wants or circumstance, as long as all the other needs (1 to 4) have all been met.
8. Self-transcendence - a transgenic level that emphasizes visionary intuition, altruism, and unity consciousness.
7. Self-actualization know exactly who you are, where you are going, and what you want to accomplish. A state of well-being.
6. Aesthetic - at peace, more curious about inner workings of all.
5. Cognitive - learning for learning alone, contribute knowledge.
4. Esteem - feeling of moving up in world, recognition, few doubts about self.
3. Belongingness and love - belong to a group, close friends to confine with.
2. Safety - feel free from immediate danger.
1. Physiological - food, water, shelter.
Maslow posited that people want and are forever striving to meet various goals. Because the lower level needs are more immediate and urgent, if they are not satisfied, they come into play as the source and direction of a person's goal.
A need higher in the hierarchy will become a motive of behavior as long as the needs below it have been satisfied. Unsatisfied lower needs will dominate unsatisfied higher needs and must be satisfied before the person can climb up the hierarchy.
Knowing where a person is located on this scale aids in determining an effective motivator. For example, motivating a middle-class person (who is in range 4 of the hierarchy) with a certificate will have a far greater impact than using the same motivator to motivate a minimum wage person from the ghettos who is struggling to meet needs 1 and 2.
It should be noted that almost no one stays in one particular hierarchy for an extended period. We constantly strive to move up, while at the same time forces outside our control try to push us down. Those on top get pushed down for short time periods, i.e., death of a loved-one or an idea that does not work. Those on the bottom get pushed up, i.e., come across a small prize or receive a better paying job. Our goal as leaders, is to help our people obtain the skills and knowledge that will push them up the hierarchy permanently. People who have their basic needs met become much better workers. There are able to concentrate on fulfilling the visions put forth to them, instead of consistently worrying about how to make ends meet.
Characteristics of self-actualizing people:
Have better perceptions of reality and are comfortable with it.
Accept themselves and their own natures.
Their lack artificiality.
They focus on problems outside themselves and are concerned with basic issues and eternal questions.
They like privacy and tend to be detached.
Rely on their own development and continued growth.
Appreciate the basic pleasures of life (do not take blessings for granted).
Have a deep feeling of kinship with others.
Are deeply democratic and are not really aware of differences.
Have strong ethical and moral standards.
Are original and inventive, less constricted and fresher than others














5 5 Self Actualization

4 4 Esteem

3 3 Social Needs

2 2 Safety Needs

1 1 Physiological needs

This figure indicates level of needs number one and number 2 can be called primary needs and number 3/4/5 can be called as secondary or higher level of needs.









This staircase suggests that once level number one is achieved, it is no more the motivator. Individual graduates to the second level and so on.
Example till individual is not employed. Employment/job is the biggest motivator. Once he/she gets the job, job does not motivate him/her but now he/she looks for the confirmation in the job.

A manager’s job is to get the work done through his/her subordinates by motivating them. An employee can do the work only when he is motivated to do that work. So the manager should know the motivation factors and the way to motivate employees.
There are four categories of employees based on the motivation factors. They are:
• Motivated and willing to work
• De-motivated and willing to work
• Motivated but unwilling to work
• De motivated and unwilling to work
Study of motivators is like study of psychology of employees. A good manager is one who can motivate his/her employees to do better work and keep them happy. So study of motivators is essential for all the managers.

Q.4 Define Delegation of authority. What are the problems in delegation? Explain
the principles of effective delegation.

Delegation means “Authorizing subordinates to make certain decisions”. Delegation is must
because – a. Structure of authority/accountability exists.
b. Superiors need to concentrate on important and vital issues.
Reasons for Delegation
• To enable the manager to get more work done by utilizing the skills and talents of subordinates.
• To foster the development of subordinates by having them participate in decision making and problem solving that allows them to learn about overall operations and improve their managerial skills.
Delegation has basically 5 degrees – Zero, low, moderate, high and fifth degree.
• Low degree of Delegation : Low degree of delegation is that in which a superior states a particular task to his subordinates and tell him to investigate on that task and report back.
• Moderate degree of delegation : It is in which a superior states the task to his subordinate. He tells him to investigate on that task and report back with action plan.
• High degree of delegation : It is that degree of delegation in which a task is specified to a subordinate and he is told to investigate on that task, make an action plan, formulate the plan and then report back with the results and reasons.

Problems in delegation is of two types :
• Problems in delegation - Manager
• Problems in delegation - Subordinate

Problems in delegation – Manager :
• Reluctant to delegate - Some managers believe in fallacy i.e. if we want it done right, do it yourself.
• Superiors delegation method - Poor examples set by superiors who do not delegate may discourage the managers to delegate further
• Subordinate’s success threatens superior’s advancement. – Low self-confidence more over confidence amongst the managers may create a bottleneck in a process of delegation
• Lack of trust in the subordinate to do well – Managers lacking required confidence and trust in subordinates might not be interested in delegating the authority.
• Fear of loosing position - Fear amongst managers that they will loose status and position.
Problems in delegation – Subordinates:
• Reluctant to accept power - Reluctant to accept delegation for fear of failure.
• Expects reward - Perceives no rewards for accepting additional responsibility.
• Fear of risk - Prefers to avoid any risk and responsibility.
Following are the ten principles of effective delegation:
• Explain the degree of delegation - The degree of delegation should be clear to both the superior and the subordinate.
• Select appropriate subordinates – Delegation should be to a right person.
• Keep lines of communication open – After the delegation there should be always a open communication channel between superior and subordinate.
• Train your subordinate and motivate them – Subordinates should be trained for the relevant work before delegating and superior should motivate the subordinate to do that delegated work.
• Reward delegation – Financial and non-financial – Subordinates should be rewarded for the delegated work. This is like a motivation for subordinates
• Keep appropriate reporting system and controlling – Supervisor should monitor the progress of delegated work, this is controlling and subordinates should report to the supervisor periodically and they should keep the superior informed about the proceedings.
• Don’t delegate and disappear – After delegating the work superior cannot escape from the responsibilities, he/she should control the delegated work.
• Don’t follow practices of ‘Delegation on Paper’ – Delegation should be done personally if it is only on paper it will not be effective.
• Believe in feedback, interaction and result orientation of delegation – Superiors should give constant feed back to the subordinates. A good interaction between superior and subordinates results in a good delegation of work.
• Principle of exception – Subordinates should not consult superior for routine matter. Subordinates should act independently.

Q.5 What is controlling? What are the principles of effective control? What steps an
organization should take before things go out of control?

Controlling in simple terms means monitoring or measuring the progress of
accomplishment of the goal.
For an organization to function effectively certain goals and objectives must be
clearly set. Plans can be realized only through effective managerial control.
Control involves setting the important standards in the organization.

In other words control can be defined as :
“Planning is the basis of control,
Action is the essence of control,
Delegation is the key to control,
And information is the guide to control.”

Definition of control as stated by few great management contributors.
“Managerial control implies measurement of accomplishment against standard and
the correction of deviations to assure attainment of objectives according to plans.” –
Koontz O’ Donnell
“Control Consists in verifying whether everything occurs in conformity with the
plans adopted, the instructions issued and the principles established.” – Henry Fayol
“Control maintains the equilibrium between ends and means, output and efforts” –
Peter Drucker

Principles of effective Control:
• Suitability : The technique of control to be used should suit the organizational working system. Different departments should have different system of control.
• Deviations: Any changes in conditions should be reported well in advance so that immediate action can be taken to avoid loss or damage.
• Objective : Control should be done with accurate and suitable standards. Management should take into consideration the proper objectives of the organization for control to be effective.
• Predictions : Control should also aim for the future. If necessary steps are taken well in advance, the management will be able to take both corrective and precautionary measures.
• Flexible : Necessary flexibility is required in control design so that control can be effective when there are some unforeseen changes in stated plans.
• Economic : It should be made sure that the benefits derived from the system should be more than the cost incurred from the control system.
• Understandable : The whole process should be clearly understood by everybody involved, especially managers. Its only then that control will be effective in the organization.
• Corrective : A proper control system should not only detect deviations from plans, but must also show the way to corrective action so that further loss or damage are not caused in the organization.

Following are the steps to be followed by any organization before things go out of control:
• Establishment of Standards : Control logically begins with setting up of standards. These provide the established criteria of desired performances for evaluating both individual and organizational performance. The criteria of desired performance vary according to the nature of business activities. Whatever standards may be set and used, they should be appropriate to the purpose attainable, flexible, precise and concerned with results rather than with procedures. Standards should also not be vague and should be understandable by all the persons concerned.
• Measurement of Actual performance : This is done for the purpose of evaluation. Measurement of actual performance should be done as accurately as possible. Technical kind of work can be measured easily but difficulties will arise where less technical kind of work are concerned. Managers and supervisors should adopt suitable methods of performance appraisal.
• Comparison Step: After the standards are set and performance is accurately measured, the next step is comparing them to see any variation between the two. When actual performance is equal to expected performance there is not much need for controlling action. This is an ideal situation, which rarely exists. In case of difference between actual performance and the desired performance, the manager should use his judgment to determine the significance of this difference.
• Corrective Action : Control process would be incomplete if corrective action is not taken. As Connor observes, “An effective control system should produce more than a red flag; it must also contain procedures to determine means of correcting the deviations:. Corrective action calls for the removal or adjustment of causative factors, with a view to put in the performance on a proper track. Also, corrections should be undertaken promptly as soon as deviations need correction. Such action may be either remedial (which is taken after the wrong has been done) or preventive (which is taken before). It is obvious that the latter is preferred to the former. Those having the authority over the actual performance put the corrective action into effect. As such, the control process ends with such proper corrective action.

Q.6 Write Detailed notes on (A) Delegation of Authority. (B) Barriers to
communication & principles of effective communication.

Q.7 Define decision making. Prepare list of factors that affect decision making
process.

Decision making is the process of generating and applying criteria to select from, among
seemingly equal alternatives.
Five steps of decision making are:
• Identifying the problem
• Collect information from all possible sources
• Generating alternative courses of action
• Evaluating the alternatives
• Selecting the best alternative
• Implementing the decision
• Follow up and review
Factors affecting the Decision making process are:
• Information ( it must be available, authentic, adequate, reliable must be available at the right time. It must be analyzed and presented in the right manner).
• Time factor : Decision must be taken at the right time. Some products are introduced ahead of time. For e.g.Dish washers introduced in India. Decisions are also time bound. In business, context, introduction of air-conditioners, coolers and refrigerators in summer and woolen clothing in winter also suggests the influence of time in decision making.
• External environmental factors : As decision making is always interactive with the environment, various environmental factors influence decision making such as economic, political, social, cultural, technical, ethical, legal, global factors.
• Internal factors : Rules, regulations, procedures within the organization or administrative restrictions also affect decision making.
• Personality of the decision maker or Subjectivity : The decision making process has a lot to do with who is the decision maker, his attitudes, perceptions, values, style of functioning, the nature of personality and overall way of thinking.
• Participation, Acceptance and Implementation : Elements of how decisions are taken, how far they are accepted and how they are to be implemented also contribute in the decision making process.
• Precedent : In a bureaucratic set up this becomes a ruling factor as question like “ Have we done this before?”, “Is there a precedent of taking such decisions?” are often asked before taking a decision.
• Experiences of a Decision Maker : As it is said that experience is the best teacher, maturity in business experience of a manager go a long way in taking effective decision.
• Power to decide: Many times, people know what is wrong in the organization, but often they do not have the power to decide and act. That is how the concept of empowerment is evolved which talks about decision making to the lowest possible level.
• Escalation of Commitment (Point of No-return) : After decision has been taken, it is often felt that the decision is going in a wrong way, but more than half of the work is completed. Therefore, there comes a point of no return and the decision has to be completed in spite of negative feedback.
• Bounded Rationality : Constructing simplified models that extract the essential features from the problems without capturing all their complexities. The decision maker settles for the easy solution that is good enough. In layman’s language, decision maker finds out the earliest available alternatives, takes certain things for granted and acts on it. The decision maker takes generalized judgmental shortcuts which are also called Heuristics. For e.g. if two students from a particular management institute show exemplary performance in the job, the judgmental shortcut is “every student from this institution is good”, and vice versa.
• Problem perception : Problems that are visible catch a decision makers decision. These problems become the first to be acted upon, or a priority. For e.g. if at the time of the chief executive officers(CEO) visit, workers start agitating, then this agitation becomes the main problem for the CEO because it is visible for him.


PART B (Any five)

Q.8 “Services Sector is India’s new economy” critically comment. What are the
general management challenges in Services Sector? (Support your answer with
corporate examples)

Q.9 Write a detailed note on Retailing sector in India – Growth prospects & various
challenges.
The retail sector in India has been quite staid and boring, but it is now coming alive and boom is just around the corner. The Indian retailing is estimated to be $180 billion, with organizes sector representing only 2% share of this market, mainly concentrated in the metropolitan cities. India is the last large Asian economy to liberalize its retail sector. Hence, the scope for retailing in India is great, as it is completely dominated by the unorganized sector. In Taiwan, the retail industries are estimated to be around $40 Billion, with organized sector representing 81% share of this market.
Obstacles for retail development in India :
Reasons for Indian consumer’s shying away from large formal stores and super market chains
1. Poverty and low literacy levels
2. Low per capita income
3. No exposure of big stores to media
4. Poor infrastructure facilities like roads, transports etc
5. Restrictions on intrastate goods movement
6. High taxes
7. High import duties on imported goods
8. Expensive supply chains
9. Focused savings and the high bargaining interests of the consumer
10. Licensing policies, which were restricting
Hence, India has been experiencing the unique strangle – hold of our traditional kirana stores and for generations, people have been shopping from the same kirana stores. Keeping in mind that retailing is the second largest employer after agriculture and that $180 billion worth of goods is retailed every year we have to slowly change our mindsets and fortunately a number of favorable factors are coming our way which will help further development of retail sector in India. These factors are:
1. Rising income and a slow but steady rise in literacy rate.
2. Rising per capita incomes
3. Improvements in infrastructure, like roads, transport, financial institutions etc.
4. Liberalization of market for consumer goods, which has helped multinational companies to make in-roads into India.
5. Reduction of customs duties
6. Shifting consumer preferences to foreign brands. Eg. Mc.Donald, Sony etc.
7. Internet is making the consumer more accessible, acting as a link.
8. Awareness being created by satellite TV channels about global products.
Challenges faced by the retail business
1. Looking beyond Price : Price is certainly an important factor in the customers decision making, but it will be self-defeating to believe that all customers are looking for price and price alone. There is a segment of customers who look beyond price for others like service after sales, product reliability, a pleasant shopping experience, cordiality of sales-persons, adherence to commitment etc. As this segment of customers is growing fast, the retailer will do well to concentrate on these factors.
2. The people factor : To deal with this challenge, training and development of these sales team at all levels is essential. They need the right skills and should be evaluated and challenged each day. This training should not be once every year or so, it should be an ongoing part of business.
3. The cultural aspect : This issue has twin factors to it:
• On the one hand we have to learn to accept and deal with people coming from very diverse background and working under the company’s corporate culture
• On the other hand you have to understand the culture of the multinational who enter our country and produce top quality goods and are also entering the field of retailing itself. We have to find a common ground to work with them.

4. The technological edge: Technology would have a much bigger role to play in retailing than its current role. For e.g. what kind of systems do we need to develop? With technologies changing everyday, what should be the budget for these systems? How do we retail people with software and technical skills, who have the whole world open to them?
5. Giving value to the customer: The entails anticipating customer expectations and fulfilling them effectively. We must remember that the greatest education happens on the showroom floor. Hence the manufacturer and the retailers must communicate with the consumers jointly.
6. Special mindsets to develop special strategies: Emerging markets and consumers are very well developed along some dimensions and totally new among others. For e.g. A friendly neighborhood retailer understand the business of customer relationship management very well, but is totally innocent about the strategies about say how to capture supply chain surpluses.
7. Exploiting the talent potential for new products and services: We need to understand and internalize that market opportunities in India is strategy development, on finding the right keys. The structure of consumer demand in India is like an iceberg – we see only parts of ready potential on the surface. The real challenges is to find appropriate offers that can unlock a vast talent potential. For e.g. Ruff and Tuff ready to stitch jeans unlocked the huge potential which Levi’s could not.
8. Coping with the change: Brands are no longer products – they are associated with life styles and peoples aspirations. One of the challenges is not to fear change but to encompass it and lead the process of change through the organization.

Q.10 “Management consultants are creation of liberalization in India” offer your
views on this statement & comment on the role of consultants & their
limitations.

Q.11 “Event Management is the biggest challenges for professional Manager”
discuss fully.

Q.12 Write notes on (A) Indian Management thought (B) Importance of Business
ethics.
(A) Indian Management thought :
“We may borrow technology from other countries but we should never borrow management practices” . This is the lesson we learnt after the western thoughts effected our organizations in negative way
This lead us to explore information about Indian management thought and practices.

Mordern Indian thought on Management has its root in the ancient Indian philosophy of Vedanta.
Indian philosophy deals with life and existence of self and realization of self and attainment of
fearless bliss or pure consciousness is its ultimate objective.
• Kautilya was the mentor and advisor of Chandragupta Maurya who wrote “Arthashastra” in 321B.C. It is based on political, social and economic management of the state
• Sukracharya’s “Shukraniti” emphasized that the king as a head of the state had to be virtuous and self-disciplined for he was chiefly the creator of social progress and prosperity.
• The king Akbar insisted upon setting the goals and accomplishing it by every possible thing.
• Samartha Ramdas contributed much to the conception of Administration and Management and his advice to Shivaji.
• Swami Vivekanand mentioned that everybody has a divine power to face challenges.
These are isolated examples of management thought. The consolidated theory of management with its universal application was not developed then nor was the management introduced as a part of any educational curriculum
Thinkers in India now started evolving management practices best suited to Indian ethos. They have turned to Indian Philosophy to ancient Indian Scriptures to seek the required guidance. Thus, the Indian management thought is emerging slowly but surely.
Many eminent people and institutes are working on this. The common basis of their management education is realization of “pure consciousness” which is the ultimate goal of the Human Activity
Some of them use :
• Transcendental Meditation
• Yoga
• Sadhana
• Patanjali Yoga Sutra – which insinuates the message of commanding oneself before directing others.
To get over tensions and stress one must practice the “yogic” exercise that consist of “
• Abstinence
• Observance
• Posture
• Breath Control
• Withdrawal of senses
• Concentration
• Meditation
• Super-Consciousness
Distinctive points about Indian ethos:
Model I
1. Balance is the keynote of Indian thought. It tries to maintain balance between short term goals of material achievements and the ultimate divine perfection.
2. Indian thought takes the individual as a central focus. If I am good, then the world is good
3. Indian thought does not consider any work as inferior or demeaning. Work is considered not only as a means to gain name, fame or power but to purify our minds and ego and take us towards the attainment of bliss.
4. Knowledge in Indian thought speaks about two fundamental categories: Creator and Creation. Indian thought tries to seek knowledge about the creator rather than the creation. The different yogic processes, social norms and values help us in transforming our minds and enables us to establish contact with the creator.
Model II
The word of management is changing to “knowledge management” physical work is being replace by the mental work. The pressures of the managers of today are tremendously increasing. Modern techniques like anti-depressants cannot help or are not the right way to get rid of this stress. Things which can help are some of the philosophies given by our encient forefathers….Like Vedanta, Vipassana, Meditation, Yoga etc.

(B) Importance of Business ethics :
Business ethics means study of good practices for business.
Key ethical principles include the following:
• Honesty
• ?Integrity
• Fulfilling commitments, abiding by agreements in letter and spirits.
• Being fair and open minded and willing to admit error
• Caring and Compassion
• Respect for human dignity
• Responsible Citizenship
• Pursuit of excellence
• Being accountable for decision and their consequences
Unethical act are result of three factors:
• Unawareness and insensitivity to issues
• Selfishness
• Faulty Reasoning

Ethical Concepts : Some fundamental ethical concepts are :
Ethical Subjectivism : Ethical Subjectivism argues that what is ethically right or wrong for an individual depends on Ethical Principles he or she has chosen
Ethical Relativism : Ethical Relativism argues that there is no universal set of principles by which to judge morality. Each society has its own rules and it is inappropriate to compare the ethical rules of one society with another. What relativism does not consider is that there may be sufficient evidence to believe that an ethical practice is based on false belief illogical reasoning etc.
Consequentalism : There are two central ideas associated with consequentialism. The first idea is the concept of value and second that of maximization of value. Thus, if happiness is considered a value, an act is ethical only if it maximizes value. An act which does not maximizes value is not ethically permissible.
Deontological Ethics : Deontological ethics emphasizes that all mature persons have adequate capacity to reason and ethical rules can be derived from the concepts of reason. We may will to do good and inadvertently cause evil. Similarly, we may will to do evil and may end up causing good. Thus the moral worth of an action cannot be defined by it’s consequences. If a person acts from a good will, then the action is moral.
The ethics of Virtue : This concept tries to explore the traits which helps the person to lead a life that is satisfying from an ethical point of view. Virtuous acts are done willfully and not by chance. Examples of virtues include courage, tolerance, generosity and honesty.
Ethical dilemma’s in business : Ethical problems result in dilemma’s for managers because they represent conflict between an organization’s economic performance and it’s social performance.
Since business run by people , it is important to ensure ethical behavior at an individual level only then collective actions of individuals, can result in ethically correct responses from the organization as a whole.
Whistle Blowing : Whistle blowing may be defined as the attempt of an employee to disclose what he or she believes to be wrongdoing in or by the organization.

Q.13 What are the problems faced by Indian Business families after 1991?
(Beginning of liberalization in India)
Following are some of the problems faced by business families after 1991:
1. Transnational attack
2. Stiff Competition
3. Low profiles
4. Fickle Consumers
5. Unproductive Labor
6. Falling Share Values etc
In spite of these, everyone of them has expanded its range of business activities. This is so because
1. These Corporate have a sound knowledge of the tastes of Indian Consumers
2. These Corporates are much more practically savvy and they know how to maintain political links
However, business family owned business also face major fears.
1. Splits like a clash between father and son or other members of the family leading to division of the company. For e.g. the Birla groups division into many companies after the death of MR.G.D.Birla
2. Successful planning to get the right person at the right place after the business pioneer retires or expires. The rules have changed after liberalization and the successor needs to have the right qualification or the corporate needs to outsource a person from outside the company, thus restricting the family’s control on the business.
3. Lack of focus where the companies need to focus more on their areas of core competence and selling of non-revenue generating companies. For e.g. Tata selling TOMCO to HLL.
4. Transnational Attack : Foreign companies are more focused, organized, able to bear shots and they pose a threat because of their global threats of product and service quality.
5. LPG(Liberalization, Privatization and Globalization): Today’s Entrepreneurs are having such huge opportunities only because of multinationals but the timing of globalization can be debated on. According to Mr.Shashikant Ruia (CEO, ESSAR Group) – “ the way the country was opened up to foreign competition was unfair, but it has to be faced up to by family business with a new set of strategies”
6. Stumbling self confidence: In the beginning, Indian business houses were not able to take courageous decisions because of their confused states.
7. Difficulties with restructuring: The changed circumstances required a great amount of change, but for most of these business houses change was painful, expensive and forced. Very few could change from within, due to lack of initiative taking ability.
8. Take Overs: since most of the Indian companies are neither technically nor financially sounce, they are always under threat of takeovers
9. HR issues: Retaining the Indian brain is a major difficulty of Indian companies. They have to:
• Tap the untapped human resources
• Give them industry standards pay packages and other remuneration
• Emphasis on overall personality development through training and exposure
• Offer them proper career path
• Delegate authority to them
• Give them space to work
10. Lack of professional management and clashes between professional CEO’s and family members who control the business. Separation of ownership from management is always a debatable issue in such companies, though the need for appointing a professional manager is widely accepted, problems arise in terms of clashes of styles and approaches towards running the company. Today however these families have to change their approach in order to remove the redundancy in the system and in view of the liberalization in market place, Indian business houses have to undergo radical strategic operational and financial transformation and most importantly, they must rewrite the role of the family. The families have realized that the family and the business are essentially two separate institutional systems with distinctive rules governing the respective behaviors they have began to appreciate this distinction. They have also made certain vital changes over their future role to make the family business survive.

Some of the strategies adopted by business families for their survival and growth :
1. Raising their capital state to a comfort zone so that the fears of take over can be kept at bay: preliberalization, many families were running the business with a low capital state of 15 to 20 % which made them vulnerable for takeovers. Post liberalization, families like Tatas, Ambanis, Singhanias have raised their stake to 26% on above and in many cases as high as 45 to 50 % to gain complete control over the management of the company.
2. Consolidation of business by selling of non viable and non core businesses such as Raymonds sold their steel division to Thyssen of Germany and cement division to Lafarage of France. Even Tata steel sold their cement division to Lafarge to concentrate on Steel business.
3. Appointment of professional managers: Business families have realized that business should run by experts and specialists and the concept of capital stake and managerial stake should be clearly defined. So many business houses are taking back seats and professional managers are running the show.
4. Attention and investment in research and development: Sp far R & D was neglected by Indian Business families. But companies have realized that creativity, innovation, new product launch, improvement in quality bringing down costs are the survival strategies of tomorrow. So business families have started spending more on R & D. For e.g. Ranbaxy Pharmaceuticals, Dr.Reddy’s lab, Mahindra & Mahindra.
5. Joint ventures and Tie ups: With globalization and government rules an regulations, moving ahead requires strategies like joint ventures. For e.g. Hero and Honda of Japan, Bajaj having technical collaboration with Kawasaki of Japan etc.
6. Technology upgradation and managing the pace of change: Technology today is moving at the speed of internet. Most of the companies have realized that managing understanding and adapting to changes are the challenges they have to face and business families are readying themselves for this.
7. Understanding the realities that economies are moving from seller market to buyers market. Business families earlier took customers for granted. Post liberalization, the consumer has wider choice of products. Business families have adapted themselves to the new product launch, customer relationship management, reliable after sales service have become the benchmarks of the new strategies.
8. Profit will not come from cornering licenses or beaurocratic favors but by being competitive at the market place. This realization has resulted into giving weight age to the performance of managers over loyalty of managers towards families.
9. Succession planning : Professional management is an attitude and mindset. Many business families scions are educated, are trained abroad and they return to take over. They begin at the grass-root level to gain experience. A senior family member and trusted professional manager acts as mentor for them. As soon as they are ready to take over, they enter the board room with confidence.

Q.14 Define emotional Intelligence. Explain its importance for a Manager.
Emotional Intelligence can be defined as the ability to reason with, and about emotions. Emotional
Intelligence combines feelings with thinking, and thinking with feeling.

"The ability to accurately interpret & appropriately manage emotional dynamics in oneself &
others . . . in ways that enhance well-being & success."
There are five components of Emotional Intelligence:
Self-Awareness
This is the ability to understand and recognize your own behavioral and emotional patterns and moods. A person who is self-aware will control the effects of his own emotions so that they have a positive effect on those around him. He is not hard on himself, or on those around him. Rather, a person with good self-awareness is honest to himself and others, and accepts and understands his strengths, weaknesses, needs, wants, and motivating factors. People who are aware of themselves and their emotions do not let their emotions get the best of them. If this happens, job performance, relationships, and other areas of their lives will be affected. People with self-awareness know how to harness their emotions into something positive instead of using them to let off steam and get further frustrated. Self-aware individuals are also highly motivated, and are headed down a solid and defined path. They are not flying by the seat of their pants, with no end goal in sight. They find it very easy to discuss their emotions without getting uncomfortable, and they can also talk about their strengths and weaknesses with others, thus allowing them to focus on these strengths and weaknesses and make corrections as needed. They take constructive criticism well, and take calculated risks by making educated decisions.

Self-Regulation
Goleman describes self-regulation as “the component of emotional intelligence that frees us from being prisoners of our feelings.” Self-regulation is similar to self-awareness in the fact that both have to do with the effects of emotions on self and others. However, while self-awareness deals with recognition of different emotions and the effects they do or can have on others, self-regulation deals with monitoring the output of those emotions and controlling them so that they can be turned into something productive. Being reasonable is a result of self-regulation, and thus people will be more willing to deal with a person who is self-regulated. Goleman says that people who are self-regulated are “able to create an environment of trust and fairness.” Self- regulation also works in what is known as a “trickle-down effect.” By being a self-regulated leader, others will catch on and act in the same rational and calm manner when dealing with conflicts because they don’t want to be known as the person who can’t handle problems reasonably and rationally. Self-regulation also helps in instances of competition. It is easier to adapt to new climates and get to know new surroundings if one is self regulated. Another reason for people to adopt the virtue of self-regulation lies in decision-making. If a person is not self-regulated, he will not be able to clearly think about the decision and weigh all the alternatives. This could result in a brash decision, causing more harm than good for his organization. By regulating his emotions, he could make a much more educated and calm decision, which would most likely result in the right move for the company. Goleman tells us that when it comes to decision-making, the signs of a self-regulated individual are reflection, thoughtfulness, adaptation to change, and integrity.

Motivation
Motivation is the one key personality characteristic that all good leaders have. They must be able to get people excited about their job, get them ready to work, and make them want to achieve the highest possible success through their efforts. Goal setting is a part of motivation. If the bar is set high, people will strive harder to achieve it. However, the bar cannot be set so high that it is unattainable. Once employees see that they can achieve goals and find good success through their efforts, they will be more faithful and committed to the organization. This also translates into higher retention rates, because committed employees will not search elsewhere for a new job, even if the salary elsewhere might be higher. If a person strongly believes in an organization that she is part of, she will not want to leave that organization and her teammates behind.

Empathy
The fourth component of emotional intelligence is empathy. It is the most easily recognized component because it is easy to see the harshness of someone who doesn’t understand, and even easier to see the compassion of someone who does. However, in the business world, empathy isn’t a mushy, touchy-feely idea. Trying to please everybody is not the key with empathy in this sense. Instead, Goleman writes, it concerns taking into account the feelings of others and other factors when making important and educated business decisions (Goleman 1995). He says that empathy is an important component of EI for these three reasons: the increasing use of teams, globalization, and retention of talent. If a team leader can understand all of the contrasting views, emotions, and opinions of the other team members, the team will function much smoother, and synergy will increase. In the area of globalization, empathy of different cultural norms can only help business. Many times, miscommunication occurs between people of different cultures. Consequently, business suffers and amiable relations between partners dwindle. By being empathetic to different cultural norms, relations are kept in good standing and more business is conducted, which helps both parties. Finally, by being empathetic to employees, companies will retain more of their talented workers because the workers will feel more respected and taken more seriously by managers. As you can see, the use of empathy provides a win-win situation for everyone involved.

Social Skill
The fifth and final component to emotional intelligence is social skill. According to Goleman, it is “the culmination of the other dimensions of emotional intelligence.” If a person is adept at social skill, he is very good at persuading people to act or believe in a certain way (a manifestation of self awareness, self regulation, and empathy combined), and he will also be an outstanding team leader (which exhibits the use of empathy). People who have good social skills are also great motivators because the people who work under them respect them. Social skills allow an employee to make connections and network her way across or outside of the company. By making acquaintances, it is easier for individuals to find out where to get certain things that they will need in the process of performing their tasks. They will become more successful in their jobs by expediting the time it takes to perform those tasks since they know where to find all of the resources they need to tap into
Leaders who do not have Emotional Intelligence create negative outcomes and often:
• Discourage creativity
• Repel the best employees, managers and customers
• Do not take signals from themselves or others
• Make problems and conflicts out of incidents
• Make decisions based on limited information
• Jeopardize communication and trust
Their egos get in the way of their actions and inappropriately affect the consequences. Moreover, conscious and unconscious feelings run their lives but they do not know it.
Consistent with demands of the "new economy" Emotional Intelligence is an important part of creating lasting relationship to customers, suppliers and employees. Leaders with high Emotional Intelligence create positive outcomes and:
• Retain and motivate their best employees
• Are effective in team outcomes
• Build lasting customer relationships
• Deal with conflict in constructive ways
• Pick up on signals
• Are open to different options
• Capitalize on their own strengths and the strengths of their people
• Make choices based a broader perspective
• Accept responsibility for managing their emotions
• Practice authentic and honest communication
• In short, they utilize the information and power of their emotions
To develop your Emotional Intelligence is very demanding but the payoff is great. Conclusion:
Your feelings are important and help shape leadership results. Pay attention to your feelings. What do they tell you? How do you decide to manage them? Do you feel them fully? Write them in a journal to see them objectively. Do you use them actively to check out which choices feel the best to you in making decisions? If you do, you would rate at the top of the leadership scale. If you don't, you are not using your Emotional Intelligence.
Your IQ is not enough anymore. Leadership and learning are inseparable and Emotional Intelligence can be tapped, emotional skills can be learned.
Emotional intelligence is important for everyone, but for managers it is a must.

Q.15 Write a detailed notes on (A) Strategic Business Units (B) Corporate
Governance.
• Strategic Business Units : SBU is a collection of product divisions that produce related or similar products. Supports related diversification because similar products that are grouped together share a common underlying technology, market, skill or resource.
A relatively independent business with coherent set of products, strategies, objectives and competitors. Many large corporations consist of a number of SBUs.
Forming SBUs has been popular in the 1990’s and one of the earlier user of this organizational device was the General Electric Co.
In 1995, Mindscape, a rapidly growing developer and publisher of software, created SBUs to handle product development for each of the segment like child, youth entertainment etc.
Recently Ranboxy started a SBU to promote its old brand products.
Complanies have been using an organizational device generally referred to as a SBU.

SBUs are distinct little business setup as units in a larger company to ensure that a certain product or product line unprompted and handled as though it were an independent business.

To be called an SBU, a business unit must meet specific criteria
o Have its own mission distinct from the mission of other SBUs
o Have definable group of competitors
o Prepare its own integrative plans, fairly distinct from those of other SBUs
o Manage its resources in key areas
o Have a proper size neither too large not too small

The Concept of SBU :
o A scientific method of grouping the business of a multi-business corporation, which helps in strategic planning
o An SBU is a group of related businesses that can be taken for the sake of strategic planning distinct from the rest of the businesses.
o Products/businesses within an SBU receive same strategic planning treatment and priorities
o The task of analyzing and segregating the assortment of the business portfolios and then regrouping them in to separate independent entities
o Products/Businesses are related from the stand point of the function are assembled as a distinct SBU.
o Unrelated products and businesses are separated.
o Grouping of the businesses on the SBU lines helps in strategic planning
o In basic factors like mission, objectives etc one SBU is distinct from the other
o SBU will have its own set of competitors and own distinct strategy
o Each SBU will have its own CEO
Advantages of SBUs:
• Minimize problems associated with sharing resources across functional areas
As firms diversify into new product market activities, single functional departments are unable to manage the increased complexity of overall business. To address this problem, SBUs areorganized around certain products or markets and each focuses on its own particular issues. The problems of sharing resources across functional areas are removed
• Quick response to environmental changes
Since decision – making authority for the SBU is delegated to each person heading it, it can adapt quickly to any environmental change.
• Increased focus on products and markets
Managers concentrate on their own particular product lines or markets. They have access to resources and staff functional specialist. The efficiency of a company pursuing unrelated diversification strategies generally improves if SBUs are formed SBU managers tend to be closer to their customers and their customer knowledge shapes the planning.
• Facilities development of general managers
As organizations increase their products – market diversity, the demand for general managers increases. Individuals with ability to comprehend and integrate the activities if diverse functional areas are needed. SBUs facilitate the training and development of general managers because these managers are given authority for formulating and implementing strategy and are held accountable for the results. Many corporations use this type of management development to effectively groom their rising general managers.
• Increases strategic and operational control permitting corporate level executives to address strategic issues
Operational decision making in a large business places excessive demands on the firm’s top management. If the top-level managers are to attend to broader, long time organizational issues, they must delegate decision making to lower level managers.

Disadvantages of Strategic Business Units :
• Increased costs incurred through duplication of personnel, operations and investments
Initiating and maintaining a divisional structure increases costs along with the number of personnel and overhead expenses. Duplication of administrative functions and the attendant operating and capital expenditure takes place.
• Difficulty in maintaining a uniform corporate image
In some instances, using a single company trademark or brand can enhance the perceived value of new or poorly performed products by transferring them identifiably and customer loyalty of stronger products to them. In other cases however a single defective product that is associated with customer dissatisfaction can damage the reputation of a company’s entire line
• Over emphasis on short term performance
Intense pressures placed on SBU mangers to meet short term return on investment targets and
to contribute to earnings per share have often fostered a lack of concern for expenditures with slower paybacks such as investment in research and development and marketing research.
• Distortion of Information
With an additional hierarchical level, information may be distorted and communications slowed as corporate managers are farther removed form individual decisions and they may even be unaware of significant developments that could impact the corporation.
(B) Corporate Governance :
Corporate Governance is the term given to the management practices followed by the business. Organizations, which aim at, better transparency, ethics and accountability.
Corporate governance has succeeded in attracting a good deal of public interest because of its apparent importance for the economic health of corporations and society in general. However, the concept of corporate governance is poorly defined because it potentially covers a large number of distinct economic phenomenon. As a result different people have come up with different definitions that basically reflect their special interest in the field. It is hard to see that this 'disorder' will be any different in the future so the best way to define the concept is perhaps to list a few of the different definitions rather than just mentioning one definition.
"Corporate governance is a field in economics that investigates how to secure/motivate efficient management of corporations by the use of incentive mechanisms, such as contracts, organizational designs and legislation. This is often limited to the question of improving financial performance, for example, how the corporate owners can secure/motivate that the corporate managers will deliver a competitive rate of return"
“Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment”
"Corporate governance is the system by which business corporations are directed and controlled. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the corporation, such as, the board, managers, shareholders and other stakeholders, and spells out the rules and procedures for making decisions on corporate affairs. By doing this, it also provides the structure through which the company objectives are set, and the means of attaining those objectives and monitoring performance"
"Corporate governance - which can be defined narrowly as the relationship of a company to its shareholders or, more broadly, as its relationship to society -…."
Aspects of Corporate Governance
1. It is almost a truism that the adequacy and the quality of corporate governance shape the growth and the future of any capital market and economy. The concept of corporate governance has been attracting ‘public attention’ for quite some time in India. The topic is no longer confined to the halls of academics and is increasingly finding acceptance for the relevance and underlying importance in the industry in the capital markets.
2. Firms in India and abroad have shown the markets and investors take notice of well managed companies, respond to them, and reward such companies. A common feature of such companies is that they have systems in place which allow sufficient freedom to the boards to take decisions towards the progress of their companies, to innovate, while remaining within a framework of effective accountability. In other words, they have a system of good corporate governance.
3. Strong corporate governance is thus indispensable to resilient and vibrant capital markets and is an important instrument of investor protection. It is the blood that fills in the veins of the transparent corporate governance disclosure and high-quality accounting practices. It is the muscle that moves a viable and accessible financial reporting structure without financial reporting premised on sound, honest numbers, capital markets will collapse among themselves.
4. Another important aspect of corporate governance relates to issues of inside trading. IT is important that insiders, which include corporate insiders also, do not use their position of knowledge and access to inside information, to take unfair advantage over the uninformed stockholders and other investors transacting in the stock of the company. To achieve this the corporates are expected to disseminate the material price sensitive information in a timely and proper manner and also ensures that till such information is made public insiders abstain from transacting in the securities of the company. The principle should be disclosed or diesis. This calls for companies to devise an internal procedure for adequate and timely disclosures, reporting requirements, confidentiality norms and code of conduct for its directors and employees with regard to their dealings in securities. However the need for such procedures, rules and guidelines also goes beyond corporates to other entitles in the financial markets such as stock exchanges, intermediaries, financial institutions and other professionals who have access to inside information. This also needs to be dealt within a comprehensive manner.
5. The comities recommendations look at corporate governance from the point of view of the stakeholders and in particular that of the shareholders because they are raison deter for corporate governance and also the prime constituency of SEBI. The control and reporting functions of boards, the roles of various committee of the board, the role of management, all assume special significance when viewed from this perspective. The other way of looking at corporate governance is inform the contribution of corporate governance to the efficiency of the enterprise to the creation of wealth and to the county’s economy. In a sense both these points of view are related and during the discussions at the meeting of the committee, there was clear convergence of both the points of view.
6. At the heart of the Committees reports is the set of recommendations, which distinguishes the responsibilities, and obligations of the boards and the management instituting the system of good corporate governance. A large part of the recommendations are mandatory and are intended to be enforced on the listed companies for initial and continuing disclosures in a phased manner within certain specified dates.
Tools for Corporate Governance
• Proper functioning of the board
• Trust
• Audit
• Professionalisation
• Communication
Hey raj, it is really nice effort and i am sure it will be helpful for the management students. I am uploaded a document regarding management questions with answers. So please check and i am sure you would like it.
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Re: management questions - January 16th, 2016

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Originally Posted by priyankajain_fms View Post
hi everyone
i want a detail note on globalisation of services.
plzzzz help me as fast as possible i hv to submit this on 3rd of november
plz help meeeee
Do not worry priyanka, i am sharing a note on the globalization of services. Please check, it may help you.
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