2. Why do managers need to be able to think globally and act locally?

ANS: One of the key premises in Global Literacy’s is that, in the borderless global marketplace,
culture actually matters more, not less.
“All business is global business, all customers are local customers, and competition comes from
everywhere,” “The question is, how do you survive in this new multicultural marketplace? We
really have to understand the importance of culture to make that happen. And that the world has
changed, but the software inside of our heads for how to lead and conduct business hasn’t really
changed.” Along with cultural understanding, the book reports that there are new “business
literacy’s” that managers and executives must learn in order to do business in the global
marketplace. They are:
• Personal literacy: understanding and valuing yourself. “This is about self-awareness,
self-renewal, and having strong values, but being flexible enough to know that people from
other cultures have different values and ethics,” “It also means being able to make fast
decisions but balance that with thoughtful consideration. Asians are probably best at personal
literacy. They’re able to live and work in contradiction and ambiguity, holding paradoxes and
opposing forces in their heads at the same time.”
• · Social literacy: engaging and challenging other people. “We learn from the
Japanese about this because…so much of what gets said is nonverbal, and they learn to read
environments, contexts, and circumstances very well. We in the United States are big talkers.”
• · Business literacy: focusing and mobilizing your business. North American
businesses, particularly those in the U.S., have perfected this skill. “We’re the world’s problem
solvers,” he said. “The business of America is business. We’re a fast-paced, action-oriented
society. We love building new things and tearing them down when they don’t work. We’re
good at navigating through chaos and leading people through change.”
• · Cultural literacy: valuing and leveraging cultural differences. European business
professionals possess this skill in abundance, Rosen explained. “These are people who
understand their own cultural heritage, but they also recognize their own strengths and
shortcomings,” he said. “They’re inquisitive internationalists, and they really try to build
bridges across cultures.”
• Because of all this reasons we have to think globally and act locally for a achieving
success.

Q 13) What is the difference between primary activities in the value chain and support
activities?
ANS (13) VALUE CHAIN :
Value Chain is a set of key activities that directly produce or support the production of what a
firm ultimately offers to customers.
PRIMARY ACTIVITIES IN THE VALUE CHAIN :
Primary Activities are those activities which form the basic part of a value chain. Without such
activities it is impossible to perform the value chain.
Some of the primary activities are Inbound Logistics, Operations in the firm, Outbound
Logistics, Marketing & sales and After Sales Service. Primary Activities go in a proper order one
after the another to carry on the process. If there are no Inbound Logistics and Operations in the
firm than Outbound Logistics, Marketing & sales and After Sales Service cannot take place.
They all are linked by each other.
SUPPORT ACTIVITIES IN THE VALUE CHAIN :
Support Activities are those supportive factors which are necessary for the primary activities to
go in proper pace and form.
Some of the support activities are Firm Infrastructure, Human Resource Management,
Technology Development and Procurement. All these supportive factors of the organization
result into the best output as they prove to be a boom for Primary Activities and also the internal
development of the organization. They play a Secondary Part in the organization.

Q18- Do you see any reasons why managing by objectives may result in increased use of
Matrix Organizational structures?

ANS – (18)MANAGEMENT BY OBJECTIVES (MBO)

MBO is an overall philosophy of management that concentrates on measurable goals and end
results. It is based on assumption that people perform better when they know what is expected on
them and can relate their personal goals to the organizational objectives. It is a process whereby
a superior and his subordinate managers jointly identify its common goals, define each
individual’s major areas of responsibility in terms of results expected by him and use these
measures as guides for operating the unit and assessing the contribution of each of its members.
FEATURES :
• MBO emphasizes participation setting goals that are tangible, verifiable and measureable.

• MBO focuses attention on what must be accomplished (goals) rather than hoe it is to be
accomplished (methods).

• MBO, by concentrating on key result areas translates the abstract philosophy of

management into concrete phraseology.

• MBO is a systematic and rational technique that always allows management to attain
maximum results from available resources by focusing on achievable goals.

MBO BENEFITS :
• Clear goals : MBO produces clear and measureable performance goals. Goals are set in
an atmosphere of participation, mutual trust and confidence. There is a meeting of minds
between superior and subordinates. Joint goal setting sessions enhance team spirit and
intergroup communications.

• Better Planning: MBO programmers sharpens the planning process. Specific goals are
products of concrete thinking. They tend to force specific planning into setting highly
specific, challenging and attainable goals; developing action programmers, providing
resources for goal accomplishment, removing obstacles to performance- all these
activities demand careful planning.

• Facilitates Control : MBO helps in developing controls. A clear set of verifiable goals
provides an outstanding guarantee for exercising better control.

• Objective Appraisal : MBO provides a basis for evaluating a person’s performance since
goals are jointly set by superiors and subordinates. It allows persons to better control their
own performance. The individual is given the freedom to police his own activities.
Management by self control replaces management by domination. Appraisals would be
more objective and impartial since employee performance is evaluated against, verifiable
objectives.

• Motivational Force : Both appraiser and appraise are committed to the same objective. It
forces managers to think of result oriented planning rather than planning for activities or
work. It allows managers increased opportunities to provide subordinates with a better fix
on the job and clarify the path to personal rewards.
 • Better Morale : MBO encourages commitment rather than rote compliance. It is at
functional of what top management demands and developmental of what people at work.
It minimizes the possible misunderstanding about what is expected of each individual and
organizational subunit. All have a tonic effect on the psychology of the subordinates.

• Result oriented Philosophy : Managers are forced to develop individual and group goals,
develop appropriate action plans, marshal the resources properly and establish needed
control standards. It helps management to avoid management by Crisis and Fire Fighting.

MBO LIMITATIONS :
• Pressure Oriented: MBO may prove to be self defeating in the long run since it is tied
with the reward punishment psychology. It is the clear violation of the integrity of
subordinate’s personalities. MBO programs sometimes discriminate against superior
performers.

• Time Consuming: BO demands a great deal of time to carefully set objectives, at all
levels of organization. Initially to instill confidence in sub-ordinates in the new system,
superior have to hold many meetings. The formals, periodic progress and final review
sessions also consume time.

• Increase Paperwork: MBO programs introduce a tidal wave of newsletter, instruction

booklets, training manuals, questionnaire and reports into the organization. To stay
abreast of what is going on in the organization, managers may demand regular reports
and data in writing, resulting in ‘grueling exercise in filling out forms’

• Goal Setting Problems: MBO works effective when important measureable objectives are
jointly agreed upon. It works less when: (1) Verifiable goals are difficult to set, (2) to
goals tend t o take precedence over the people who use it, (3) Goals are inflexible and
rigid,(4) There is over emphasis on quantifiable and easily measureable results instead of
important ones, (5) Over emphasis on short term goals at the expense of long term goals.

• Organizational Problems: MBO is not a palliative for all organizational ills. It is not for
everybody. MBO creates more problems than it solves when:

 There is failure to teach the philosophy to all participants.

 There is failure to limit objectives.

 It is inconsistent with management philosophy.

 The program is used as a “WHIP” to control employee performance.

 It leads to a tug of war in which the subordinate tries to set the lowest possible
targets and superior the highest.
  Manager turn MBO into a sham and start “playing games”.

MATRIX ORGANISATION STRUCTURE

A permanent organization designed to achieve specific results by using teams of specialists from
different functional areas in the organization is a MATRIX ORGANIZATION. It is actually a
hybrid structure combining both functional and product structures in the same part of the
organization.
FEATURES :
• Matrix Structure is an extension of the Project Management Concept i.e. project
managers are assigned a variety of projects rather than a single one.

• The normal vertical hierarchy is overlaid by a form of lateral influence.

• A number of project managers direct the activities of a number of projects while the
functional heads allocate their resources to meet the requirements of these various
projects.

• There is usually a more equal division of authority between project managers and
functional line managers.

STRENGTHS :
• Efficiency : A matrix form permits efficient utilization of resources especially manpower.
Resources can be freely allocated across different products. It allows pooling and sharing
of specialized resources across products in a natural routine way.

• Flexibility : Matrix form encourages constant interaction among members of the project
unit and the functional department. Quick decisions can be taken and the organization can
encounter the challenging and uncertain environment in a better way.

• Technical Excellence : Matrix structure ensures the maintenance of high technical

standards. They facilitate high quality and innovative solutions to technical problems.
Frequent interactions take place and each specialist is forced to listen, understand and
respond to the views of the other.

• Balance : Matrix structure is a way of balancing customer’s need for project completion
and cost control with the organization’s need for economic cooperation and development
of technical capability for the future.

• Freeing top management : Matrix structure permits decision making at lower levels.
Since many decisions are to be made at lower levels, the top management has more time
to interact with the environment.
 • Motivation : In matrix structures, more emphasis is placed on the authority of knowledge
than the position of an individual in the organizational hierarchy. Membership of the
team is based on the special knowledge for the given aspects of the work.

• Development : A matrix structure helps employees to develop and grow. It enlarges their
experience and broadens their outlook. It exposes them to a wider arena full of
challenges. It gives persons of high potential an excellent means of demonstrating their
capabilities and make a name for themselves.

WEAKNESSES :
• Power Struggles : Matrix foresters power struggles between product and functional
managers. Unfortunately, both functional and product managers share the same set of
resources leading to unhealthy competition.

• Stress : Matrix organizations can be stressful places to work in. The use of matrix means
the use of dual command. Managers often end up jockeying for power an influence. The
comfort of bureaucracy’s predictability is replaced by growing insecurity and stress.

• Costs : The matrix organization incurs great administrative costs than a conventional
hierarchy. In an attempt to cover themselves against blame, managers try to put
everything in writing. It increases the management costs to double.

• Balance : It is rather difficult to strike a stable balance between project and functional
authority. The two kinds of influence are negatively correlated. The more successful
lateral collaboration is achieved at a given level, the greater are the stresses up through
the vertical hierarchy.

Therefore, the advantages and disadvantages of the MBO have resulted in increased use of
Matrix Organization having various Strengths and Weaknesses.

19. If you were the president of the company that was organized along functional lines and
a consultant suggested you organize along territorial lines or product lines, what might
concern you in following this recommendation?
Ans. I am owning a medium sized organization which have less product variety but its divided
across the country. Therefore i am having functional structure so that I can have specialization of
functional knowledge and there will be less duplication of resources. Now a consultant
suggesting me to go for product structure, I know it’s good type of structure but it will more
suitable for bigger organization or organization which is focus on products or customers. It is
good for evaluating performance of the product, it can have full concentrate on market changes
for that product but same time there is risk of conflict between product group and corporate
objective and also it will increase cost as there are more managers and there will be huge
expenditure on advertising and all. This product line structure is good for FMCG companies like
HUL, P&G, etc. whose having lot many products but our organization is not having such vast
variety of product therefore I’ll recommend only functional structure.

20. What are the key difference between strategic, tactical and operational plans?
Ans.
 Strategic plans are designed to meet the broad objectives of an organization. They are
long range plans.

 Tactical plans are concerned with implementing strategic plans by co-ordinating the work
of various departments in the organization. They are known as intermediate plans.

 Operational plans are short range plans. They offer details as to how the strategic plans
will be accomplished.

1) Strategic plans :-

- They are long range plans.

- Their time frame varies for 3 or more years.

- It is the responsibility of the top management.

- It is concerned with broad objectives of the organization.

- Strategic plans focus on planning & forecasting.

2) Tactical plans :-

- They are called as intermediate plans.

- Their time frame varies from 2-3 years.

- They are performed by mangers at middle level.

 - It concerned with integrating the work of various departments in the organization.

- It focuses on co-ordination.

3) Operational plans :-

- These are short range plans.

- Their time frame is of 1year.

- They are performed at lower level.

- They cover day-to-day operation, implements internal goals.

- Focus on control primarily.

21. What is bench marking and what role it play in planning?

Ans. Benchmarking is a concept that is now widely accepted. It is an approach for setting goals
& productivity measures based on best industry practices. Benchmarking is developed out of the
need to have date against which performance can be measured. What should be the criteria?
If a company needs 6days to fulfill a customer order and the competitor in the same industry
needs only 5days, than 5days do not become the standard if a firm in an unrelated industry can
fill orders in 4days. The 4days criteria becomes the benchmark even when at first this seems to
be an unachievable goal. The process involved in filling the orders is then carefully analyzed &
creative ways are encouraged to achieve the benchmark. There are 3types of benchmarking viz.
1. Strategic Benchmarking:- Which compares various strategies & identifies the key
strategic elements of success.

2. Operational Benchmarking :- Which compares relative costs or possibilities for product

differentiation.

3. Tactical Benchmarking :- It focuses on support functions such as market planning,

information systems, logistics, human resource management & so on.
 The benchmarking procedure depends on what is to be benchmarked? Then
superior performers have to be selected. Data need to be gathers & analyzed, which become the
basis for performance goals. During the implementation of the new approach, performance is
periodically measured & corrective actions are taken at that time.
Thus for benchmarking proper planning has to be at strategic, operational &
tactical level. Due to proper planning, the targets on goals can be achieved thus fulfilling the
achievement of benchmarking. In order to achieve an organizational goals planning is done
before benchmarking, therefore both these functions go hand-in-hand.

22) What is the different between defining requirements and assessing resources in the
planning recourse?
Ans: To define business objectives, one or more planning sessions must be held. These
sessions should focus on the overall business objectives and not detailed functional or technical
requirements (these requirements are defined in later phases). The following information should
be prepared and distributed for review prior to the first session.

• An internal analysis of any existing web sites

• An inventory of top-level business functions
• An analysis of any partner sites and the services they offer to their partnering businesses
• A competitive analysis of web sites owned by the competition
• Any case studies available that show how other companies in similar situations are using
the web.

It may help to break the pre-reading material down into several sessions and plan the sessions
around reviewing and discussing the impact of that material on what the business wants to
achieve.

A common example is a customer service center that contains a record showing one version of a
customer's status (orders, billing, payments, etc.), and a finance department in the same
enterprise with different status information. This discrepancy may reflect a recent change made
by the finance department, and the true status may not yet be available to other departments. As
a result, customer service cannot serve accurate information.

ERP can eliminate these silos and reduce waste, allowing the organization to save time and
repurpose information across the enterprise for greater efficiency.

23)Compare strategic, tactical & operational control. Why are the boundaries between
each are not clear?
Ans.Strategic (long range plans):-1)Long range plan.
2) time frame:3 or more years.
3)Top management responsibility.
4)Concerned with broad objectives of the organisation.
5)Focus on planning & forecasting.
 Tactical (intermediate) :-1)Intermediate plan.
2)Time frame:2-3years.
3)Performed by managers at middle level.
4)Concerned with integrating the work of various
department in the organization.
5) Focus on coordination.

Operational (short range plans):-1)Short range plans.

2) Time frame:1years.
3)Done usually at lower levels.
4)Cover day-to-day operations; implements internal goal.
5)Focus on control, primarily.

24) How is the control function linked to other managerial functions?

Ans . The objective of objective function is to ensure that action contribute to goal
accomplishment. It helps in keeping the organizational activities in the right path & aligned with
plans & goals. It is measured & compared with that had been planned. If the measured
performance had been found wanting, the manager must find reasons & take corrective actions.
If the performance is not found to be wanting, some planning decision must be made, altering the
original plans. If the controlling function is to be effective, it must be proceeded to other
planning. Thus controlling includes four things :-
• Setting standards of performance.
• Measuring actual performance.
• Comparing actual performance against the standards.
• Taking corrective actions to ensure goal accomplishment.
These functions are linked & most managerial functions use a combination of above four things
simultaneously to solve the problems which are faced by the companies. All management
function are interrelated to each other.