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PREFACE
With the rapidly changing socio-economic and political environment and
trend towards globalization of economies, management of human resources
in modern organisations has become a very challenging job. The people in
organisations differ in terms of their attitudes, beliefs, values, background,
knowledge etc and a thorough understanding of these concepts and
processes can be of great value to the modern managers. The present study
material synthesizes the study of the individual, the group and the
organisation system and elaborates the applied behavioral science concepts,
principles and techniques. It also provides an integrated view of modern
organisations, their environment and organizational designs for healthy
organisation and environment interface.
The subject matter has been presented in a simple and lucid manner, keeping
the unique requirements of students in mind. A critical and balanced
coverage is given to all the important topics in ORGANISATION AND
MANAGEMENT. At the end of each chapter, multiple choice questions are
given to enable the students to have self-appraisal of their understanding of
the concepts in the chapter.
I am grateful to all those who have directly or indirectly helped me in
preparing this course material. I sincerely believe that there is always scope
for improvement. Therefore; I invite suggestions for further enriching the
study material.
GEETA MISHRA
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INDEX
Chapter Topic
No.
Page No.
Overview of Management
46
The Organization
83
123
Bibliography
166
167
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CHAPTER I
OVERVIEW OF MANAGEMENT
CONTENTS
1.1
1.2
1.3
1.4
1.5
1.6
1.7
Classical approach
Neo Classical Approach
Systems Approach to Management
Contingency Approach
Management and Managerial Roles
Practice and Study of Management
Challenges of Management in the 21st century
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SCHOOLS OF MANAGEMENT
Management has been practiced in some form or the other since the dawn of
civilization. Ever since human beings started living and working together in
groups, techniques of organisation and management were evolved. The
Pyramids of Egypt, the Chinese Wall, the Roman Catholic Church and other
such wonders could not be possible without the application of management
principles and techniques.
Despite ancient origins, very little conceptual and organized body of
knowledge could be developed until the end of 19 th century. A scientific and
systematic study and application of management began mainly after the
Industrial Revolution. Since then the development of management thought
has been quite rapid.
The main stages in this development can be classified as follows:
1.
2.
3.
4.
1.1
Classical approach
Neo-classical approach
Systems approach
Contingency approach
CLASSICAL APPROACH
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2.
3.
4.
5.
6.
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from
several
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suggested that the best way to resolve the problem is to increase the
size of surplus so that each side can have a larger share.
In other words, Taylor believed that management and labour have a
common interest in increasing productivity.
To sum up, Taylors principles:
Science, not rule of thumb
Harmony, not discord
Maximum output, in place of restricted output.
Development of each man to his greatest efficiency
Maximum prosperity of employer, coupled with maximum prosperity of
each employee.
Co-operation not individualism.
According to F.W Taylor, Scientific management is the art of knowing
exactly what you want men to do and seeing that they do it in the best and
the cheapest way.
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3. Functional Foremanship
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4. Standardization
a. It implies the physical attitude of products should be such that it
meets the requirements & needs of customers.
b. Taylor advocated that tools & equipments as well as working
conditions should be standardized to achieve standard output
from workers.
c. Standardization is a means of achieving economics of
production.
d. It seems to ensure
The line of product is restricted to predetermined type,
form, design, size, weight, quality. Etc
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Critical evaluation
Although it is accepted that the scientific management enables the
management to put resources to its best possible use and manner, yet it has
not been spared of severe criticisms.
Workers Viewpoint:
1. Unemployment - Workers feel that management reduces employment
opportunities from them through replacement of men by machines and
by increasing human productivity less workers are needed to do work
leading to chucking out from their jobs.
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2. Exploitation - Workers feel they are exploited as they are not given
due share in increasing profits which is due to their increased
productivity. Wages do not rise in proportion as rise in production.
Wage payment creates uncertainty & insecurity (beyond a standard
output, there is no increase in wage rate).
3. Monotony - Due to excessive specialization the workers are not able
to take initiative on their own. Their status is reduced to being mere
cogs in wheel. Jobs become dull. Workers loose interest in jobs and
derive little pleasure from work.
4. Weakening of Trade Union - To everything is fixed &
predetermined by management. So it leaves no room for trade unions
to bargain as everything is standardized, standard output, standard
working conditions, standard time etc. This further weakens trade
unions, creates a rift between efficient & in efficient workers
according to their wages.
5. Over speeding - the scientific management lays standard output, time
so they have to rush up and finish the work in time. These have
adverse effect on health of workers. The workers speed up to that
standard output, so scientific management drives the workers to rush
towards output and finish work in standard time.
Employer's Viewpoint:
1. Expensive - Scientific management is a costly system and a huge
investment is required in establishment of planning dept.,
standardization, work study, training of workers. It may be beyond
reach of small firms. Heavy food investment leads to increase in
overhead costs.
2. Time Consuming - Scientific management requires mental revision
and complete reorganizing of organization. A lot of time is required
for work, study, standardization & specialization. During this
overhauling of organization, the work suffers.
Some experts believe that Taylors contribution has been somewhat overemphasised .The originality of his ideas has been doubted. Business
managers have opposed the idea of replacing judgment with
prefabricated techniques. The term scientific management is not
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3.
Discipline. Employees must obey, but this is two-sided:
employees will only obey orders if management play their part by
providing good leadership.
4.
Unity of Command. Each worker should have only one boss
with no other conflicting lines of command.
5.
Unity of Direction. People engaged in the same kind of
activities must have the same objectives in a single plan. This is
essential to ensure unity and coordination in the enterprise. Unity of
command does not exist without unity of direction but does not
necessarily flows from it.
6.
Subordination of individual interest (to the general interest).
Management must see that the goals of the firms are always
paramount.
7.
Remuneration. Payment is an important motivator although by
analyzing a number of possibilities, Fayol points out that there is no
such thing as a perfect system.
8.
Centralization (or Decentralization). This is a matter of degree
depending on the condition of the business and the quality of its
personnel.
9.
Scalar chain (Line of Authority). A hierarchy is necessary for
unity of direction. But lateral communication is also fundamental, as
long as superiors know that such communication is taking place.
Scalar chain refers to the number of levels in the hierarchy from the
ultimate authority to the lowest level in the organization. It should not
be over-stretched and consist of too-many levels.
10. Order. Both material order and social order are necessary. The
former minimizes lost time and useless handling of materials. The
latter is achieved through organization and selection.
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BUREAUCRACY (1864-1920)
Max Weber, a German social scientist, analyzed the formation and
administration of public bureaucracies, which happen to be the oldest form
of organisation. Weber evolved an ideal type of bureaucracys a conceptual
model for analytical purposes. His model is characterized by the following
features:
1. Division of work. There is a high degree of specialization or division of
labor in a bureaucratic organisation. A task is divided into very specialized
jobs and each member performs his specialized function in a predictable
manner.
2. Rules and Regulations. Detailed and rigorous rules and regulations are
laid down to specify and govern the work behavior, rights and duties of job
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Hawthorne Experiments
The Hawthorne Studies (also knows as the Hawthorne Experiments) were
conducted from 1927 to 1932 at the Western Electric Hawthorne Works in
Cicero, Illinois (a suburb of Chicago). This is where Professor Elton Mayo
examined the impact of work conditions in employee productivity. Elton
Mayo started these experiments by examining the physical and
environmental influences of the workplace (e.g. brightness of lights,
humidity) and later, moved into the psychological aspects (e.g. breaks, group
pressure, working hours, managerial leadership) and their impact on
employee motivation as it applies to productivity.
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Feedback mechanism
Throughout the series of experiments, an observer sat with the girls in the
workshop noting all that went on, keeping the girls informed about the
experiment, asking for advice or information, and listening to their
complaints.
The experiment began by introducing various changes, each of which was
continued for a test period of four to twelve weeks. The results of these
changes are as follows:
Work Conditions and Productivity Results
Under normal conditions with a forty-eight hour week, including Saturdays,
and no rest pauses. The girls produced 2,400 relays a week each.
1. They were then put on piecework for eight weeks.
o Output increased
2. They were given two five-minute breaks, one in the morning, and one
in the afternoon, for a period of five weeks.
o Output increased, yet again
3. The breaks were each lengthened to ten minutes.
o Output rose sharply
4. Six five-minute breaks were introduced.
o The girls complained that their work rhythm was broken by the
frequent pauses
o Output fell only slightly
5. The original two breaks were reinstated, this time, with a
complimentary hot meal provided during the morning break.
o Output increased further still
6. The workday was shortened to end at 4.30 p.m. instead of 5.00 p.m.
o Output increased
7. The workday was shortened to end at 4.00 p.m.
o Output leveled off
8. Finally, all the improvements were taken away, and the original
conditions before the experiment were reinstated. They were
monitored in this state for 12 more weeks.
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The major finding of the study was that almost regardless of the
experimental manipulation, worker production seemed to continually
improve. One reasonable conclusion is that the workers were happy to
receive attention from the researchers who expressed an interest in them.
Originally, the study was expected to last one year, but since the findings
were inexplicable when the researchers tried to relate the worker's efficiency
to manipulated physical conditions, the project was incrementally extended
to five years.
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BEHAVIORAL APPROACH
Human relations movement focused on interpersonal relations and
overlooked the wider subject of organizational behavior. Organisational
behavior involves the study of attitudes, behavior and performance of
individuals and groups in organizational setting. Behavioral approach
includes the issue of organizational behavior. It is also known as human
resource approach because it stresses development of human beings for the
benefit of both the individual and the organisation.
The main propositions of behavioral science approach are as follows:
1. An organisation is a sociotechnical system
2. Individuals differ in terms of their attitudes, perceptions and value
systems. Therefore they react differently to the same situation.
3. People working in an organisation have their needs and goals which may
differ from the organisations needs and goals. Management should achieve
fusion between organizational goals and human needs.
4. A wide range of factors influence relations among people.
5. Peoples behavior as individuals may be different from their behavior as
members of a group.
6. Persons working together in an organisation form their own informal
groups. Such groups have their own norms, culture and communication
systems.
7. Informal groups exercise a significant influence on the attitudes, behavior
and performance of employees.
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Feedback
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Information Processing
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Decision Making
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Challenges
Do hard work
Have to deal with a variety of
personalities.
Often have to make do with
limited resources.
Motivate workers in chaotic
and uncertain situations.
Successfully blend knowledge,
skills,
ambitions
and
experiences of a diverse work
group.
Success depends on others
work performance.
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The "hit them with a whip" school of management suffered a decline and fall
in the 20th century, though remnants still exist in various places in the world
and the wish for such methods still is expressed now and then even by
contemporary managers. Other methods of managing workers received
classical expression in Frederick Taylors Scientific Management in 1911.
Taylorism led to new management tools involving such techniques as
measurement and statistics.
What might be called the "efficiency expert" school of management was for
the most part supplanted around the 1960s by a more "humanistic" approach,
whose classical exponent was the psychologist Abraham Maslow. The
changes in management thinking in this decade reflected the more educated
workforce and greater respect for democracy that grew out of World War II.
In the 1970s Robert Greenleaf invented Servant Leadership, and in the
1990s Peter Block carried this concept forward to Stewardship. These ideas
revolutionized the mental model for managers by suggesting that they
replace thinking about how to get people to do things with thinking about to
help people do things.
Best practice management concepts in the late 20th century also included
excellence and total quality management, reengineering, systems thinking,
cross functional teams, empowerment and flat organization charts, learning
organization, dialogue, reinventing work, and diversity. As knowledge in
general increased with "Internet speed," management thought, already
heavily influenced by psychological sciences, and received infusions from
numerous disciplines. Moreover, cross-fertilization between academia and
the business community created a vast increase in management related
research activity.
Some of these trends such as TQM and reengineering - seemed by 2000 to
have run their course. The permanent value of the new thinking underlying
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them, however, should not be denied; and 21st century versions of these
movements should actually be welcomed.
Others trends such as learning and diversity progressed to the point
where "second generation" (learning organization) or "new" (diversity)
versions appeared. In the early 21st century, it was even easy to see the
development of a "third wave" in these well-established concepts.
Just as the 21st century has seen new types of organizations and new ways
of doing business arise, so, too, will there be new management trends, ideas,
and techniques. While running after every trendy idea is hardly a
recommendable strategy, the wise manager will learn, study, and apply the
best current thinking.
At the start of the 21st century, the following rate to be the most important
ideas regarding management:
Management is for everyone. As educational levels rise and information
technology accelerates, the distinction between "managers" and "workers"
will fade away and management knowledge will be everyone's
responsibility.
Management is for learners. As information becomes the chief product of
every business and as knowledge continues to explode, everyone will be a
learner and the manager's foremost task will to promote learning.
Management is based on communicating. As techniques for planning,
strategizing, decision-making, and problem solving become the common
province of everyone in the organization, the need for improving
communication will be paramount and managers will be increasingly using
dialogue and other communication tools.
Management is about change. As technology and information reshape all
our lives, change management will be "business as usual" and managers will
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be change agents who guide everyone to find and embrace the best new
practices.
Management is broad based. As boundaries disappear within
organizations and in the world at large, the scope of management will grow
and managers will be organizational development experts, diversity experts,
facilitation experts, consultation experts and much else.
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CHAPTER I QUIZZES
Q1.Which one of the following theories ignored the concept of leadership,
motivation, power and informal relations?
(a) Classical
(b) Behavioral
(c) Modern
Q2.Which theory states that there is no best way to manage all situations?
(a)Systems Theory
(b)Contingency theory
(c)Administrative Theory
Q3. The general conclusion of the Relay Assembly Test Room Experiments
was that employees would work better if the management was concerned
about their welfare and superiors paid special attention to them. This
phenomenon was subsequently labeled as the..
(a)Relay effect
(b)Hawthorne effect
(c)Human effect
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(c)Administrative
Q5. Weber coined the term .to identify large organisations that operated
on a rational basis.
(a)Autocracy
(b)Diplomacy
(c)Bureaucracy
Q6. Management is:
(a) An Art
(b) A Science
(c) Both
Q7.Which of the following Fayols principles of management aims at
avoiding the possibility of conflicting orders?
(a)Well-defined hierarchy of authority
(b)Unity of Command
(c)Unity of Direction
Q8. Espirit de corps means
(a) Unity is strength
(b) Buyer Beware
(c) Service is our motto
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CHAPTER II
MANAGEMENT IN THE ERA OF CHANGE
CONTENTS
2.1 Multiple stakeholder Relationship
2.2 Ethics
2.3 Social Responsibility: - The modern challenges
2.4 Values
2.5 Values & Corporate Culture
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Inside Stakeholders
Inside stakeholders are people who are closest to an organisation and have
the strongest or most direct claim on organisational resources: shareholders,
managers, and the work force.
SHAREHOLDERS. Shareholders are the owners of the organisation, and,
as such, their claim on organisational resources is often considered superior
to the claims of other inside stakeholders. The shareholders contribution to
the organisation is to invest money in it by buying the organisations stock.
The shareholders inducement to invest is the prospective money they can
earn on their investment in the form of dividends and increase the price of
stock. Investments in stock are risky, however, because there is no guarantee
of a return. Shareholders who do not believe that the inducement (the
possible return on their investment) is enough to warrant their contribution
(the money they have invested) sell their shares and withdraw support from
the organisation.
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TABLE
INDUCEMENTS AND CONTRIBUTIONS OF ORGANISATIONAL
STALEHOLDERS
Stakeholder
Contribution
Organisation
to
INSIDE
Shareholders
Managers
Workforce
OUTSIDE
Customers
Suppliers
Government
Unions
Community
General public
the Inducement
Contribute
to
Dividends
and
appreciation
Salaries, bonuses, status
and power
Wages, bonuses, stable
employment,
and
promotion
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withdraw their support for the organisation by reducing the level of their
performance or by leaving the organisation.
Outside stakeholders
Outside stakeholders are people who do not own the organisation, are not
employed by it, but do have some interest in it. Customers, suppliers, the
government, trade unions, local communities, and the general public are all
outside stakeholders.
CUSTOMERS. Customers are usually an organisations largest outside
stakeholders group. Customers are induced to select a product (and thus an
organisation) from alternative products by their estimation of what they are
getting relative to what they have to pay. The money they pay for the
product is their contribution to the organisation and reflects the value they
feel they receive from the organisation. As long as the organisation produces
a product whose price is equal to or less than the value customers feel they
are getting, they will continue to buy the product and support the
organisation. If customers refuse to pay the price the organisation is asking,
they withdraw their support, and the organisation loses a vital stakeholder.
Southwest Airlines attention to its customers has resulted in their loyal
support.
SUPPLIERS. Suppliers, another important stakeholder group, contribute to
the organisation by providing reliable raw materials and component parts
that allow the organisation to reduce uncertainty in its technical or
production operations and thus reduce production costs. Suppliers have a
direct effect on the organisations efficiency and an indirect effect on its
ability to attract customers. An organisation that has high- quality inputs can
make high-quality products and attract customers. In turn, as demand for its
products increases, the organisation demands greater quantities of highquality inputs from its suppliers.
One of the reasons why Japanese cars remain so popular with U.S.
consumers is that they still require fewer repairs than the average U.S. made
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vehicle. This reliability is a result of the use of component parts that meet
incredibly stringent quantity control standards. In addition, Japanese parts
suppliers are constantly improve their performance. The close relationship
between the large Japanese automakers and their suppliers is a stakeholder
relationship that pays long-term dividends for both parties. Realizing this, in
the last decade U.S. car manufacturers have also moved to establish strong
relationships with their suppliers to increase quality, and the reliability of
their vehicles has increased as result.
THE GOVERNMENT. The government has several claims on an
organisation. It wants companies to compete in a fair manner and obey the
rules of free competition. It also wants companies to obey agreed-upon rules
and laws concerning the payment and treatment of employees, workers
health and laws concerning the payment and treatment of employees,
workers health and workplace safety, nondiscriminatory hiring practices,
and other social economic issues about which Congress has enacted
legislation. The government makes a contribution to the organisation by
standardizing regulation so that they apply to all companies and no company
can obtain an unfair competitive advantage. The government controls the
rules of good business practice and has the power to punish any company
that breaks these rules by taking legal action against it. Thus its contribution
is to leave a company alone. Sometimes, however, it may leave companies
too alone.
TRADE UNIONS. The relationship between a trade union and an
organisation can be one of conflict or cooperation. The nature of the
relationship has a direct effect on the productivity and effectiveness of the
organisation and the union. Cooperation between managers and the union
can lead to positive long-term outcomes if both parties agree on an equitable
division of the gains from an important in a companys fortunes. Managers
and the union might agree, for example, to share the gains from cost saving
due to productivity improvements that resulted from a flexible work
schedule. Traditionally, however, the managements-union relationship has
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2.2 ETHICS
The Advantages of Ethical Behavior
Ethics- the moral values, beliefs, and rules that govern the way
organisational stakeholders should act toward one another- from an
important part of organisations cultural values. In an age when many
different stakeholders scrutinize an organisations action, and competition is
fierce, organisations cannot afford to engage in actions that will be hurt their
reputation. Neither can they allow employees to take advantage of their
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requirements will have a good reputation valuable asset that makes people
want to deal with it. Although unethical organisations might reap short
term benefits, they are penalized in the long run because eventually people
will refuse to deal with them.
Why Does Unethical Behavior Occur?
If there are good reasons for individuals and organisations to behave
ethically, why do we see so many instances of unethical behavior?
Lapses in Individual Ethics
In the theory, individuals learn ethical principles and codes of morality as
they mature. Ethics are learned from family, friends, religious institutions,
schools, professional associations, and other organisations. From their
experiences, people learn to differentiate right from wrong. However,
imagine that your father is a mobster, your other is a political terrorist, or
your family belongs to a warring ethnic or religious group. Brought up in
such a context, you may believe that it is ethical to do anything and to
perform any act - including murder to benefit your family, friends, or
group. In a similar way, individuals within an organisation may come to
believe that any action that promotes or protects the organisation is
acceptable, even if it does harm to others. That sort of thinking prompted the
Beech Nut management team to approve the sale of sugar water labeled as
apple juice.
Ruthless Pursuit of Self- Interest
We normally confront ethical issues when we weigh our personal interests
against the effects that our actions will have on others. Suppose you will be
promoted to vice president of your company if you can secure a $100
million contract, but that to get the contact, you must bribe the contractor
with $1 million. Your career and future will probably be assured if you
perform this act. What harm will it do? you ask yourself. Bribery is
common, and if you dont pay the million dollars, you are certain that
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somebody else will. So what do you do? Research suggests that people who
believe they have the most at stake are the ones most likely to act
unethically. Similarly, it has been shown that organisations that are doing
badly economically and are struggling to survive are the ones most likely to
commit unethical and illegal acts such as price fixing or bribery, although
many other organisations will do so if they are given the opportunity.
Outside Pressure
Many studies have found that the likelihood of unethical or criminal
behavior increases when people feel outside pressure to perform. If company
performance is deteriorating, for example, top managers may feel pressures
from shareholders to boost performance, and fearful of losing their jobs, they
may engage in unethical behavior to increase the value of corporate stock. If
outside pressures work in the same direction, it is easy to understand why
unethical organisational cultures develop. Managers at all levels buy into
unethical acts and the view that the end justifies the means comes to
permeate the organisation. As organisational members pull together to
disguise their unethical action and to protect another from prosecution, the
organisation becomes increasingly defensive.
The temptation for organisations to collectively engage in unethical and
illegal behavior is very great. Industry competitors can clearly see the
advantages of acting together to raise prices because of the extra profits
they will earn. The harm they inflict as a result of their collusion is difficult
to see because their customers may number in the millions. Unethical
companies may rationalize by saving that individual customers are affected
so slightly that they are hardly hurt at all. However if every company in
every industry behaved unethically, and if all companies tried to extract
money from their customers, customers would have much less to spend and
the nations economy as a whole would suffer. Moreover, price fixing results
in a misallocation of societys resources. Companies spend less and less on
improving their products because they have no incentive to improve them.
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Simply by increasing prices they can make all the money they want with the
products they already have.
The social costs of unethical behavior are hard to measure but can easily be
seen in the long run. They take the form of mismanaged organisations that
become less innovative and spend less and less on research and development
and more and more on advertising or managerial salaries. When new
competitors arrive who refuse play the game, the mismanaged organisation
starts to crumble.
In sum, if an organisations ethics violate societys ethics are embodied in
law; the organisation is acting illegally and will be subject to sanction. If
organisational ethics violate generally accepted business and social customs
and practices, organisations may lose their reputations. Beyond these two
limits on ethical behavior, an organisations ethics are a function of the
moral values of its stakeholders and of the power of the different stakeholder
groups to impose these values on the organisation.
Creating an Ethical Organisation
An organisation is ethical if the people inside the organisation are ethical.
How can people judge if they are making ethical decisions and thus acting
ethically? One way is as follows: If a person (a) makes a decision (or takes
an action) that falls within the accepted values or standards that typically
apply in the organisations environment; (b) is willing to see the decision
communicated to all the parties affected by it for example, having it
reported in newspapers or on television; and (c) believes that other people
with whom the person has a significant personal relationship, such as family
members, friends, or even managers in other organisations, would approve
the decision, then the decision is probably acceptable on ethical grounds. By
contrast, an unethical decision would be one that a manager would wish to
disguise or hide from other people because the decision harms other
stakeholders in ways that are not acceptable based on the standards or values
in the environment, or benefits him or her personally.
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consider the social implications of their decisions. AS one may expect, there
is no complete agreement on the definition of social responsibility. A survey
conducted on the matter revealed Corporate social responsibility is
seriously considering the impact of the companys actions on society. In a
broad sense, business owes a lot to the various groups such as customers,
employees, shareholders, government and the community at large in which it
exists. As one argues for business involvement in social activities, there are
also arguments against it, as follows:
Arguments for social involvement of business
1. Public needs have changed, leading to changed expectations.
Business, it is suggested, received its charter from society and
consequently had to respond to the needs of society.
2. Improvement of the social environment benefits both society and
business. Society gains through better neighborhoods and
employment opportunities; business benefits from a better
community, since the community is the source of its work force and
the consumer of it products and services.
3. Social involvement discourages additional government regulation
and intervention. The result is greater freedom and more flexibility
in decision making for business.
4. Business has a great deal of power which, it is reasoned, should be
accompanied by an equal amount of responsibility.
5. Modern society is an interdependent system and the internal
activities of the enterprise have an impact on the external
environment.
6. Social involvement may be in the interest of stockholders.
7. Problems can become profits. Items that may once have been
considered waste (for example, empty soft drink cans) can be
profitably used again.
8. Social involvement creates a favorable public image. Thus, a firm
may attract customers, employees and investors.
9. Business should try to solve the problems which other institutions
have not been able to solve. After all business has a history of
coming up with novel ideas.
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10. Business has the resources. Specifically, business should use its
talented managers and specialists, as well as its capital resources to
solve some of societys problems.
11. It is better to prevent social problems through business
involvement than to cure them. It may be easier to help the hard-core
unemployed than to cope with social unrest.
Arguments against social involvement of business
1.. The primary task of business is to maximize profit buy focusing
strictly on economic activities. Social involvement could reduce
economic efficiency.
2. In the final analysis, society must pay for the social involvement of
business through higher prices. Social involvement would create
excessive costs for business, which cannot commit its resources to
social action.
3. Social involvement can weaken the international balance of
payments. The cost of social programs, the reasoning goes, would
have to be added to the price of the product. Thus American
companies selling in international markets would be at a
disadvantage when competing with companies in other countries
which do not have these social costs to bear.
4. Business has enough power and additional social involvement
would further increase its power and influence.
5. Business people lack the social skill to deal with the problems of
society. Their training and experience is with economic matters and
their skills may not be pertinent to social problems.
6. There is a lack of accountability of business to society. Unless
accountability can be established, business should not get involved.
7. There is not complete support for involvement in social actions.
Consequently, disagreements among groups with different
viewpoints will cause friction.
Not withstanding the above arguments many organisations have taken
up the social causes. Though profit is essential to the business the social
involvement and its extent of involvement of the organisation should be
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2.4 Values
Milton Rokeach, a noted psychologist, has defined values as global beliefs
that guide actions and judgments across a variety of situations. He further
said, Values represent basic convictions that a specific ode of conduct (or
end-state of existence) is personally or socially preferable to an opposite
mode of conduct (or end-state of existence). They contain a judgmental
element, i.e., they carry an individuals ideas as to what is right, good, or
desirable. Values have both content and intensity attributes. The content
attribute emphasizes that a mode of conduct or end-state of existence is
important. The intensity attribute specifies how important it is. When we
rank an individuals values in term of their intensity, we obtain the value
system of that person. All of us have a hierarchy of values that forms our
value system. This system is identified by the relative importance we assign
to such values as freedom, self-respect, honesty, obedience, equality, and so
on.
Values are so embedded that they can be inferred from peoples behavior
and their perception, personality and motivation. They generally influence
their behavior. Values are relatively stable and enduring. This is because of
the way in which they are originally learnt.
The values learnt can be divided into two broad categories: (i) terminal
values, and (ii) instrumental values Terminal values lead to ends to be
achieved, e.g., comfortable life, family security, self respect and sense of
accomplishment. Instrumental value; relate to means for achieving desired
ends, e.g., ambition, courage, honesty and imagination. Terminal values
reflect what person is ultimately striving to achieve, whereas instrumental
values reflect how the person gets there
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Instrumental
(means)
Comfortable life
Ambition
Sense of accomplishment
Courage
Family security
Honesty
Mature love
Helpfulness
Self- respect
Independence
wisdom
Imagination
Values
Types of Values
All port and his associates have categorized values into six types as follows:
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Different people place different importance to the above six value types.
In other words, every individual has a system of values ranking from first to
sixth. This is very important from the point of view of understanding the
behavior of people. The fact that people in different occupations have
different value systems has led the progressive organisations to improve the
values- job fit in order to increase employee performance and satisfaction.
Sources of Values
Parents, friends, teachers and external reference group can influence
individual values. Indeed, a persons values develop as a product of learning
and experience in the cultural setting in which he lives. As learning and
experiences vary from one person to another, value differences are the
inevitable result. Not only the values but also their ranking in terms of
importance differs from person to person.
A person learns and develops values because of the following factors:
(i)
(ii)
(iii)
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CHAPTER II QUIZZES
Q1. Which of the following determines a persons ethical or unethical
behavior?
(a)Values
(b) Procedures
(c) Rules
Q2. In which of the following situations does an intensity of an ethical issue
increase?
(a)Everyone agrees that the action is right
(b)Many people will be harmed by the action
(c)When the action has no serious impact on people.
Q3.Which of the following is not an ethical guideline that would help
managers ensure that their decisions and actions are ethical?
(a)Obeying the law
(b)Hiding the truth
(c)Upholding human dignity
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CHAPTER III
INTERPRETING THE ORGANIZATIONAL REALITY
CONTENTS
3.1 Organizational power
3.2 Organizational Politics
3.3 Organization Decision Making
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have power over them. These rewards can be anything that another person
values. In an organizational context, we think of money, favourable
performance appraisals, promotions, interesting work assignments, friendly
colleagues, important information, and preferred work shifts or sales
territories.
Coercive and reward power are actually counterparts. If you can remove
something of positive value from another or inflict something of negative
value upon him or her, you have coercive power over that person. If you can
give someone something of positive value or remove something of negative
value, you have reward power over that person. As with coercive power, you
dont need to be a manager to be able to exert influence through rewards.
Rewards such as friendliness, acceptance, and praise are available to
everyone in an organization. To the degree that an individual seeks such
rewards, your ability to give or withhold them gives you power over that
individual.
Legitimate power
In formal groups and organizations, probably the most frequent access to
one or more of the power bases is ones structural position. This is called
legitimate power. It represents the power a person receives as a result of his
or her position in the formal hierarchy of an organization.
Positions of authority include coercive and reward powers. Legitimate
power, however, is broader than the power to coerce and reward.
Specifically it includes acceptance by members of an organization of the
authority of a position. When school principals, bank presidents, or army
captains speak (assuming that their directives are viewed to be within the
authority of their positions), teachers, tellers and first lieutenants listen and
usually comply.
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Expert power
Expert power is influence wielded as a result of expertise, special skill, or
knowledge. Expertise has become one of the most powerful sources of
influence as the work has become more technologically oriented. As jobs
become more specialized, we become increasingly dependent on experts
to achieve goals. So, just as physicians have expertise and hence expert
power most of us follow the advice our doctor gives us so too do
computer specialists, tax accountants, solar engineers, industrial
psychologists, and other specialists.
Referent power
The last category of influence that French and Raven identified was referent
power. Its base is identification with a person who has desirable resources or
personal traits. If I admire and identify with you, you can exercise power
over me because I want to please you.
Referent power develops out of admiration of another and a desire to be like
that person. In a sense, then, it is a lot like charisma. If you admire someone
to the point of modelling your behaviour and attitudes after him or her, that
person possesses referent power over you. Referent power explains why
celebrities are paid millions of dollars to endorse products in commercials.
Marketing research shows that people like Bill Cosby, Elizabeth Taylor, and
Michael Jordan have the power to influence your choice of photo processors,
perfume and athletic shoes. With a little practice, you or I could probably
deliver as smooth a sales pitch as these celebrities, but the buying public
doesnt identify with you and me. In organizations, if you are articulate,
domineering, physically imposing, or charismatic, you hold personal
characteristics that may be used to get others to do what you want.
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broadly and deeply about the issues. Because of the intense time
pressure that managers face, it may be tempting to do just a superficial
analysis. The five whys approach suggests that employees learn to
ask why not just once, but five times. Asking the first time, why this
is happening usually results in a superficial explanation for the
problem; subsequent whys force decision makers to probe more
deeply into the causes of the problem and possible solutions.
Be an effective decision maker. An effective decision-making process
has these six characteristics (1) It focuses on whats important;(2) Its
logical and consistent;(3) It acknowledges both subjective and
objective thinking and blends analytical with intuitive thinking;(4) It
requires only as much information and analysis as is necessary to
resolve a particular dilemma;(5) It encourages and guides the
gathering of relevant information and informed opinion; and (6) Its
straightforward, reliable, easy to use, and flexible
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CHAPTER IV
THE ORGANIZATION
CONTENTS
4.1Motivation
4.2Motivational Theories
4.3Concept of Organisation structure
4.4Components of Organisation Structure
4.5Types of Organisation Structure
4.6Dimensions of Organisation Structure
4.7Organisational Design
4.8Organisational Culture Concept & Dimensions
4.9Level of organizational Culture
4.10 Organisation Culture at NIIT
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4.1 Motivation
Motivation is a process that starts with a physiological or psychological need
that activates a behavior or a drive that is aimed at a goal.
Every employee is expected to show increased and qualitative productivity
by the manager. To achieve this behavior of the employee is very important.
The behavior of the employees is influenced by the environment in which
they find themselves. Finally, an employee's behavior will be a function of
that employee's innate drives or felt needs and the opportunities he or she
has to satisfy those drives or needs in the workplace
If employees are never given opportunities to utilize all of their skills, then
the employer may never have the benefit of their total performance. Work
performance is also contingent upon employee abilities. If employees lack
the learned skills or innate talents to do a particular job, then performance
will be less than optimal. A third dimension of performance is motivation.
Motivation is the act of stimulating someone or oneself to get desired
course of action, to push right button to get desired reactions.
The following are the features of motivation:
Motivation is an act of managers
Motivation is a continuous process
Motivation can be positive or negative
Motivation is goal oriented
Motivation is complex in nature
Motivation is an art
Motivation is system-oriented
Motivation is different from job satisfaction
MOTIVATIONAL FACTORS
There are several factors that motivate a person to work. The motivational
factors can be broadly divided into two groups:
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I. MONETARY FACTORS:
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Money as a motivator
It is normally believed that money acts as a motivator. In general the role of
money as a motivator depends upon certain factors:
Money fails to motivate people, when there is no direct
relationship between reward and effort.
money. For poor person, the value of certain amount of money is quite
high as compared to rich.
e the
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same time. ERG theory does not assume a rigid hierarchy where a lower
need must be substantially satisfied before one can move on.
Alderfer also deals with frustration-regression. That is, if a higher-order
need is frustrated, an individual then seeks to increase the satisfaction of a
lower-order need.
According to Maslow an individual would stay at a certain need level until
that need was satisfied. ERG theory counters by noting that when a higherorder need level is frustrated the individuals desire to increase a lowerlevel need takes place. Inability to satisfy a need for social interaction, for
instance, might increase the desire for more money or better working
conditions. So frustration can lead to a regression to a lower need.
In summary, ERG theory argues, like Maslow, that satisfied lower- order
needs lead to the desire to satisfy higher-order needs; but multiple needs can
be operating as motivators at the same time, and frustration in attempting to
satisfy a higher- level need can result in regression to a lower- level need.
Alderfer's Hierarchy of Motivational Needs
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2) DISSATISFACTION (HYGIENE):
dissatisfaction were found to be:
The
determinants
of
job
company policy
administrative policies
supervision
salary
interpersonal relations
working conditions
From the results Herzberg concluded that the replies people gave
when they felt good about their jobs were significantly different from
the replies given when they felt bad. Certain characteristics tend to be
consistently related to job satisfaction and others to job dissatisfaction.
Intrinsic factors, such as work itself, responsibility and achievement
seem to be related to job satisfaction. Respondents who felt good
about their work tended to attribute these factors to themselves. On
the other dissatisfied respondents tended to cite extrinsic factors such
as supervision, pay, company policies and working condition.
Herzberg proposed that his findings indicated the existence of a dual
continuum: the opposite of satisfaction is No satisfaction and the
opposite of Dissatisfaction is No Dissatisfaction.
According to Herzberg, the factors leading to Job satisfaction are
separate and distinct form those that lead to job dissatisfaction.
Therefore, managers who seek to eliminate factors that can create job
dissatisfaction may bring about peace but not necessarily motivation.
They will be placating their workforce rather than motivating them.
As a result, conditions surrounding the job such as quality of
supervision, pay , company policies, physical working conditions
relations with others and job security were characterized by Herzberg
as hygiene factors, when theyre adequate, people will not be
dissatisfied ; neither will they be satisfied. If we want to motivate
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superior
and
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complex in character. No manager can claim to have all the skills and
expertise to perform all the diverse kinds of jobs. Again, large scale business
activities are not confined to one place. It may have several branches and
units at several places. Delegation becomes a necessity for running these
branches. An organisation is continuity. Managers may go and come but the
organisation continues. Delegation provides continuity of operations in the
organisation. The process of delegation helps managerial development in an
organisation.Thus, delegation is important for any organisation because it
reduces the burden of the managers and leaves him free to look after
important matters of the organisation. It is a method by which subordinates
can be developed and trained to take up higher responsibilities. It provides
continuity to the organisation and creates a healthy organisational climate by
creating better understanding among the employees.
The major benefits of delegation are:
Delegation leads to professionalism.
Managerial decisions may involve creativeness and
innovativeness.
The competitive environment may be created in the
organisation.
The mangers may take quick decisions.
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to the limited availability of time. Narrow span, on the other hand, requires
multiple levels of supervision and hence longer time for communication. It
is more expensive and complicates the process of communication. A narrow
span however enables managers to exercise close supervision and control.
Although there are certain limits to the span of control, the tendency in
recent years has been to avoid specifying absolute number because it has
been recognized that the ideal span depends on a number of factors. Some of
the important factors are discussed below:
Nature of the Work: If the work is simple and repetitive, the span of
control can be wider. However, if the work requires close supervision the
span of control must be narrow.
Ability of the Manager: Some managers are more capable of supervising
large number of people than others. Thus for a manager who possesses
qualities of leadership, decision-making ability and communication skill in
greater degree the span of control may be wider.
Efficiency of the Organisation: Organisations with efficient working
systems and competent personnel can have larger span of control.
Staff Assistants: When staff assistants are employed contact between
supervisors and subordinates can be reduced and the span broadened.
Time Available for Supervision: The span of control should be narrowed at
the higher levels because top managers have less time available for
supervision. They have to devote the major part of their work time in
planning, organizing, directing and controlling.
Ability of the Subordinates: Fresh entrants to jobs take more of a
supervisors time than trained persons who have acquired experience in the
job. Subordinates who have good judgment, initiative, and a sense of
obligation seek less guidance form the supervisor.
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Functional Structure
Divisional Structure, and Adaptive Structure
Functional Structure
When units and sub-units of activities are created in organisation on the
basis of functions, it is known as functional structure. Thus, in any industrial
organisation, specialised functions like manufacturing, marketing, finance
and personnel constitute as separate units of the organisation. All activities
connected with each such function are placed in the same unit. As the
volume of activity increases, sub-units are created at lower levels in each
unit and the number of persons under each manager at various levels gets
added. This results in the interrelated positions taking the shape of a
pyramid.
The main advantage of the functional structure of organisation is that there is
functional specialisation in each unit, which leads to operational efficiency
of people engaged, and the organisation as a whole derives the benefit of
specialised operations. The heads of the functional units are in direct touch
with the chief executive who can sort out inter-functional problems, if any,
and also coordinate the interrelated functions.
The chief executive is also able to be in direct touch with lower level
subordinates and thereby have full knowledge of the state of affairs in the
organisation.
However, while the functional arrangement may be well suited to small and
medium size organisations, it is incapable of handling the problems of an
organisation as it grows in size and complexity. Problems of subunits at
lower levels do not receive adequate attention of higher level managers
while some of the activities tend to be over-emphasized.
Functional units become unwisely and difficult to manage when there are
diverse kinds of activities performed in large number of sub-units. Personal
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Divisional Structure
The divisional organisation structure is more suited to every large enterprise
particularly those which deal in multiple products to serve more than one
distinctive markets. The organisation is then divided into smaller business
units which are entrusted with the business related to different products or
different market territories. In other words, independent divisions (product
divisions or market division), are created under the overall control of the
head office. Each divisional manager is given autonomy to run all functions
relating to the product or market segment or regional market. Thus, each
division may have a number of supporting functions to undertake. A
divisional structure may consist of two or more product divisions or market
or territorial divisions.
In a divisional structure each division contributes planned profits to the
organisation, but otherwise operates as an independent business. The
functional units are headed by managers while the final authority vests in the
divisional manager, who coordinates and controls the activities of the
various functional units in the division. The top management of the
organisation, besides providing funds, determines the organisation goals and
formulates policies.
The divisional structure is characterised by decentralization of authority.
Thus, it enables managers to take decisions promptly and resolve problems
appropriate to the respective divisions. It also provides opportunity to the
divisional managers to take initiative in matters within their jurisdiction. But
such a structure involves heavy financial costs due to the duplication of
supporting functional units for the divisions. Moreover, it requires adequate
number of capable managers to take charge of the respective divisions and
their functional units.
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Adaptive Structure
Organisation structure is often designed to cope with the unique nature of
undertaking and the situation.
This type of structure is known as adaptive structure. There are two types of
structures in it:
i) Project Organisation, and
ii) Matrix Organisation
i) Project Organisation: When an enterprise undertakes any specialised,
time-bound work involving one-time operations for a fairly long period, the
project organisation is found most suitable. In this situation the existing
organisation creates a special unit so as to engage in a project work without
disturbing its regular business. This becomes necessary where it is not
possible to cope with the special task or project. Within the existing system,
the project may consist of developing a new project, installing a plant,
building an office complex, etc. A project organisation is headed by a
project manager in charge, who holds a middle management rank and
reports directly to the chief executive. Other managers and personnel in the
project organisation are drawn from the functional departments of the parent
organisation. On completion of the project they return to their parent
departments.
The main advantage of such a structural arrangement is that it leaves regular
business undisturbed. It is exclusively concerned with the task of completing
the project work on time and in conformity with the standards of
performance relevant to its goal. There is better management and control
over the project activities as the project manager enjoys necessary authority
and is alone responsible for the results. But project organisation may create
problems as well. Functional managers often resent the exercise of authority
by the project manager in the functional areas and hence conflict arises. The
stability of the functional departments is disturbed by transfer of personnel
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activities
reduce
the
variability
in
the
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behaviour, however at the same time it may influence objective and rational
thinking.
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designed for specific customer requirements for a specific period to carry out
the work. Team culture and openness are emphasised a great deal. NIITs
corporate culture focuses on values such as quality, creativity, and customer
satisfaction. The quality culture of NIIT has been the result of the sustained
efforts of its management perpetuated through induction, socialisation,
reinforcement, innovation, and concern for internal and external customers.
The quality culture is ingrained at NIIT in such a way that the priority is to
prevent mistakes rather than rectify them. Also, quality efforts are backed by
results, which are rewarded.
Employees are treated as intellectual capital and are looked after well. The
happy and committed employees ensure customer satisfaction and this has
got them wide acceptance across the globe. It has got well designed
mechanisms for monitoring the quality for its products, services and or
software processes. Most of NIITs businesses have ISO 9000 certification.
The work culture at NIIT has gone through all the stages of culture
development like symbols, behaviour, organisational values, attitudes, and
shared assumptions, and probably this is the reason it has been able to
sustain it.
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CHAPTER IV QUIZZES
Q1. Who proposed that human needs develop in a hierarchical manner?
(a) Abraham Maslow
(b) Elton Mayo
(c) Chris Argyris
Q2. The ..of an organization provides guidelines for its policies and
practices.
(a)Corporate Culture
(b)Corporate rules
(c)Corporate program
Q3.Which of the following structures is a type o departmentalization that
superimposes a horizontal set of divisional reporting relationships on a
hierarchical structure?
(a)Matrix
(b)Hybrid
(c)Divisional
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Q9.
.,
proposed
by
Douglas
McGregor,has
positive,dynamic,flexible and optimistic view of employees.
(a) Theory X
(b) Theory Y
(c) Theory Z
Q10. In Maslows hierarchy of needs,..refer to the desire to become
what one is capable of becoming.
(a)Esteem needs
(b)Self actualization needs
(c)Social needs
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CHAPTER v
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each employee properly to develop technical skills for the job for
which he has been employed and also to develop him for the
higher jobs in the organization. Proper development of personnel
is necessary to increase their skills in doing their jobs and in
satisfying their growth need. For this purpose, the personnel
departments will device appropriate training programmes. There
are several on-the-job and off-the-job methods available for
training purposes. A good training programme should include a
mixture of both types of methods. It is important to point out that
personnel department arranges for training not only of new
employees but also of old employees to update their knowledge
in the use of latest techniques.
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for
children
of
employees,
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of Change
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function will become more creative and less mechanistic. It will be more
concerned with substance rather than form, accomplishments rather than
activities, and practice rather than theory. The personal function will be
responsible for furthering the organization not just maintaining it. HR
managers will have to devote more time to promote changes than to
maintain the status quo.
5. Managing Work Diversity
In modern organizations, management of diverse workforce is a great
challenge. Workforce diversity can be observed in terms of male and female
workers, young and old workers, educated and uneducated workers,
unskilled, skilled and professional employees, etc. Moreover, many
organizations also have people of different castes, religion and nationalities.
The work-force in future will comprise more of educated and self-conscious
workers. They will ask for higher degree of participation and avenues for
self-fulfillment. Moreover, the proportions of professional and technical
employees will increase in relation to blue-collar workers. The ratio of
female employees in the total workforce will also rise. Integration of women
within managerial ranks will itself be a problem. Money will no longer be
the sole motivating force for majority of the workers. Non-financial
incentives will also play an important role in motivating the workforce. In
short, human resources will be treated as assets which will appear in Balance
Sheets of business organizations in future.
Two important trends among the employees which need mention briefly
discussed below:
(a) Increasing Aspirations of employees. Considerable changes have
been noted in the worker of today in comparison to his counterpart of
1980s. The workers are becoming more aware of their higher level
needs and this awareness would intensify further in the future
workers. The managers would be required to evolve appropriate
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8. Total
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5.7 Recruitment
According to Edwin B.Flippo, Recruitment is the process of searching the
candidates for employment and stimulating them to apply for jobs in the
organisation. It is a linking activity that brings together those offering jobs
and those seeking jobs.
Dale S.Beach observed, Recruitment is the development and maintenance
of adequate manpower resources. It involves the creation of a pool of
available labour upon whom the organisation can draw when it needs
additional employees.
There are two broad methods of Recruitment which are as follows:
1. External Recruitment
2. Internal Recruitment
External Recruitment
Every enterprise has to tap external sources for various positions. Running
enterprises have to recruit employees from outside for filling the positions
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enterprise. But can help in creating the talent pool or the database of the
probable candidates for the organisation
EMPLOYEE
REFERRALS
/
RECOMMENDATIONS
Many organisations have structured system where the current employees of
the organisation can refer their friends and relatives for some position in
their organisation. Also, the office bearers of trade unions are often aware of
the suitability of candidates. Management can inquire these leaders for
suitable jobs. In some organizations these are formal agreements to give
priority in recruitment to the candidates recommended by the trade union.
RECRUITMENT AT FACTORY
GATE
Unskilled workers may be recruited at the factory gate these may be
employed whenever a permanent worker is absent. More efficient among
these may be recruited to fill permanent vacancies.
Merits of external sources of recruitment
Qualified Personnel. By using external sources of recruitment, the
management can make qualified and trained people to apply for vacant jobs
in the organisation.
Wider Choice. When vacancies are advertised widely, a large number of
applicants from outside the organisation apply. The management has a wider
choice for selecting the people for employment.
Fresh Talent. The insiders may have limited talents. External sources
facilitate infusion of fresh blood with new ideas into the enterprise.
Competitive Spirit. If a company can tap external sources, the existing staff
will have to compete with the outsiders. They will work harder to show
better performance.
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5.8 Selection
Nature and Purpose of Selection
Selection involves a series by which the candidates are screened for
choosing the most suitable persons for vacant posts. The process of
selection leads to employment of persons who possess the ability and
qualifications to perform the jobs which have fallen vacant in an
organization. It divides the candidates for employment into two
categories, namely, those who will be offered employment and those
who will not be. This process should be called rejection since more
candidates may be turned away than employed. That is why, selection is
frequently described as a negative process in contrast with the positive
nature of recruitment.
The most basic purpose of the selection process is to choose right type of
candidates to man various positions in the organization. In order to
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absenteeism and labor turnover low and will increase the morale of the
employees. If the employees are suitable according to the requirements of
the jobs, they will show higher efficiency and productivity. This will also
enable the organization to achieve its objectives effectively.
The benefits of selecting right kinds of people for various jobs are as
follows:
(i)
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5.9 Training
Training is a process of learning a sequence of programmed behavior. It is
the application of knowledge & gives people an awareness of rules &
procedures to guide their behavior. It helps in bringing about positive change
in the knowledge, skills & attitudes of employees.
Thus, training is a process that tries to improve skills or add to the existing
level of knowledge so that the employee is better equipped to do his present
job or to mould him to be fit for a higher job involving higher
responsibilities. It bridges the gap between what the employee has & what
the job demands.
Since training involves time, effort & money by an organization, so an
organization should to be very careful while designing a training program.
The objectives & need for training should be clearly identified & the method
or type of training should be chosen according to the needs & objectives
established. Once this is done accurately, an organization should take a
feedback on the training program from the trainees in the form of a
structured questionnaire so as to know whether the amount & time invested
on training has turned into an investment or it was a total expenditure for an
organization.
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After doing the SWOT analysis, weaknesses can be dealt with the training
interventions, while strengths can further be strengthened with continued
training. Threats can be reduced by identifying the areas where training is
required. And, opportunities can be exploited by balancing it against costs.
For this approach to be successful, the HR department of the company
requires to be involved in strategic planning. In this planning, HR develops
strategies to be sure that the employees in the organization have the required
Knowledge, Skills, and Attributes (KSAs) based on the future KSAs
requirements at each level.
Individual Level Training need analysis at individual level focuses
on each and every individual in the organization. At this level, the
organization checks whether an employee is performing at desired
level or the performance is below expectation. If the difference
between the expected performance and actual performance comes out
to be positive, then certainly there is a need of training.
However, individual competence can also be linked to individual
need.
Operational Level Training Need analysis at operational level
focuses on the work that is being assigned to the employees. The job
analyst gathers the information on whether the job is clearly
understood by an employee or not. He gathers this information
through technical interview, observation, psychological test;
questionnaires asking the closed ended as well as open ended
questions, etc. Today, jobs are dynamic and keep changing over the
time. Employees need to prepare for these changes. The job analyst
also gathers information on the tasks needs to be done plus the tasks
that will be required in the future. Based on this information training
need analysis is done.
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Significance of training
To impart to the new entrants the basic knowledge & skills they
need for an intelligent performance of definite tasks.
To prepare employees for more responsible positions.
To bring about change in attitudes of employees in all directions.
To reduce supervision time, reduce wastage & produce quality
products. To reduce defects & minimize accident rate.
To absorb new skills & technology. Helpful for the growth &
improvement of employee's skills & knowledge.
METHODS OF TRAINING:
The most widely used methods of training used by organizations are
classified into two categories: On-the-Job Training & Off-the-Job Training.
ON-THE-JOB TRAINING is given at the work place by superior in
relatively short period of time. This type of training is cheaper & less timeconsuming. This training can be imparted by basically four methods: Coaching is learning by doing. In this, the superior guides his sub-ordinates
& gives him/her job instructions. The superior points out the mistakes &
gives
suggestions
for
improvement.
Job Rotation: - In this method, the trainees move from one job to another,
so that he/she should be able to perform all types of jobs. E.g. In banking
industry, employees are trained for both back-end & front-end jobs. In case
of emergency, (absenteeism or resignation), any employee would be able to
perform
any
type
of
job.
OFF THE JOB TRAINING: - is given outside the actual work place.
Lectures/Conferences:- This approach is well adapted to convey specific
information, rules, procedures or methods. This method is useful, where the
information is to be shared among a large number of trainees. The cost per
trainee
is
low
in
this
method.
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Films: - can provide information & explicitly demonstrate skills that are not
easily presented by other techniques. Motion pictures are often used in
conjunction with Conference, discussions to clarify & amplify those points
that
the
film
emphasized.
Simulation Exercise: - Any training activity that explicitly places the
trainee in an artificial environment that closely mirrors actual working
conditions can be considered a Simulation. Simulation activities include case
experiences, experiential exercises, vestibule training, management games &
role-play.
Cases: - present an in depth description of a particular problem an employee
might encounter on the job. The employee attempts to find and analyze the
problem, evaluate alternative courses of action & decide what course of
action would be most satisfactory.
Experiential Exercises: - are usually short, structured learning experiences
where individuals learn by doing. For instance, rather than talking about
inter-personal conflicts & how to deal with them, an experiential exercise
could be used to create a conflict situation where employees have to
experience a conflict personally & work out its solutions.
Vestibule Training: - Employees learn their jobs on the equipment they will
be using, but the training is conducted away from the actual work floor.
While expensive, Vestibule training allows employees to get a full feel for
doing task without real world pressures. Additionally, it minimizes the
problem
of
transferring
learning
to
the
job.
Role Play: - Its just like acting out a given role as in a stage play. In this
method of training, the trainees are required to enact defined roles on the
basis of oral or written description of a particular situation.
Management Games: - The game is devised on a model of a business
situation. The trainees are divided into groups who represent the
management of competing companies. They make decisions just like these
are made in real-life situations. Decisions made by the groups are evaluated
& the likely implications of the decisions are fed back to the groups. The
game goes on in several rounds to take the time dimension into account.
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also helps decide on promotions and helps the superior determine the
appropriate compensation decisions. It also helps decide on promotions and
helps the superior determine the appropriate training that may be necessary
to enhance the employees performance.
Performance evaluation also helps build confidence as the employee has an
opportunity to voice his opinions and his grievances to his superior.
There are a number of methods of performance appraisal. No single method
can be considered ideal in all circumstances. The methods of performance
appraisal can be broadly classified into two categories: traditional and
modern methods.
Traditional methods are the relatively older methods of performance
appraisal.These methods are based ob studying the personal qualities of the
employees.
The traditional methods are as follows:
1. ESSAY APPRAISAL METHOD
This traditional form of appraisal, also known as Free Form method
involves a description of the performance of an employee by his
superior. The description is an evaluation of the performance of any
individual based on the facts and often includes examples and
evidences to support the information. A major drawback of the
method is the inseparability of the bias of the evaluator.
2.
STRAIGHT
RANKING METHOD
This is one of the oldest and simplest techniques of performance
appraisal. In this method, the appraiser ranks the employees from the
best to the poorest on the basis of their overall performance. It is quite
useful for a comparative evaluation.
3.
PAIRED COMPARISON
A better technique of comparison than the straight ranking method,
this method compares each employee with all others in the group, one
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CRITICAL INCIDENTS
METHODS
In this method of performance appraisal, the evaluator rates the
employee on the basis of critical events and how the employee
behaved during those incidents. It includes both negative and positive
points. The drawback of this method is that the supervisor has to note
down the critical incidents and the employee behaviour as and when
they occur.
5.
FIELD
REVIEW
In this method, a senior member of the HR department or a training
officer discusses and interviews the supervisors to evaluate and rate
their respective subordinates. A major drawback of this method is that
it is a very time consuming method. But this method helps to reduce
the superiors personal bias.
6.
CHECKLIST
METHOD
The rater is given a checklist of the descriptions of the behaviour of
the employees on job. The checklist contains a list of statements on
the basis of which the rater describes the on the job performance of
the employees.
7.
8.
FORCED DISTRIBUTION
To eliminate the element of bias from the raters ratings, the evaluator
is asked to distribute the employees in some fixed categories of
ratings like on a normal distribution curve. The rater chooses the
appropriate fit for the categories on his own discretion.
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Modern Methods:
Modern Methods were devised to improve upon the traditional methods.
Modern methods attempt to remove the short comings of the old methods
such as subjectivity, bias etc. Some of the modern methods are:
1.Behaviorally
Anchored
Rating
Scales
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Clarity of goals With MBO, came the concept of SMART goals i.e.
goals that are:
Specific
Achievable
Measurable
Realistic
Time
bound
The goals thus set are clear, motivating and there is a linkage between
organizational goals and performance targets of the employees.
The focus is on future rather than on past. Goals and standards are set
for the performance for the future with periodic reviews and feedback.
degree
appraisal
has
four
integral
components:
Self appraisal
Superiors appraisal
Subordinates
appraisal
Peer appraisal.
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Self appraisal gives a chance to the employee to look at his/her strengths and
weaknesses, his achievements, and judge his own performance. Superiors
appraisal forms the traditional part of the 360 degree appraisal where the
employees responsibilities and actual performance is rated by the
superior.
Subordinates appraisal gives a chance to judge the employee on the
parameters like communication and motivating abilities, superiors ability to
delegate the work, leadership qualities etc. Also known as internal
customers, the correct feedback given by peers can help to find employees
abilities to work in a team, co-operation and sensitivity towards others.
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RESOURCE
ACCOUNTING
METHOD
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CHAPTER V QUIZZES
Q1is the organization function of planning for human resource needs,
recruiting and training candidates and evaluating their performance.
(a)Resource Management
(b)Human Resource Management
(c) Manpower Management
Q2.Which of the following involves estimating the size and makeup of the
future workforce and helping the organization acquire the right number and
right kind of people when they are needed.
(a)Human Resource Planning
(b) Human Requirements Planning
(c)Work Force Planning
Q3. ..consists of a set of activities aimed at attracting and
selecting individuals for positions in a way that will facilitate the
achievement of organizational goals
(a)Recruitment
(b) Selection (c)Staffing
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best
meet
the
(a)Staffing
(b)Recruitment
(c)Selection
Q6.Job rotation is an.training process.
(a)On the Job
(b)Off the Job
(c)None of the above
Q7..is also known as a multirater feedback approach of performance
appraisal.
(a)360-Degree
(b)MBO
(C)180-Degree
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BIBLIOGRAPHY
1. Singh B.P.,Chhabra T.N,2004,Organisation Theory and Behavior,
Dhanpat Rai & Co. (Pvt.) Ltd.
2. Robbins S., Coulter M,2005 ,Management ,Prentice Hall of India Pvt.
Ltd.
3. Chhabra T.N,2005,Human Resource Management ,Concepts and Issues
Dhanpat Rai &Co.(P)Ltd.
4. Rao VSP,2000,Human Resource Management Text and Cases,
Excel Books
5.Shukla M,2006,Understanding Organisations:Organisational Theory
And Practices in India.PHI
6. Aggarwal Tanuja,2007,Strategic Human Resource Management.
Oxford University Press.
7. Barat, N.1998, Emerging Issues in Management, Excel Books ,India
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