Unit 1

INTRODUCTION TO
MANAGEMENT AND
ORGANIZATIONS
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Definition of Management

► Management is the art of getting things done through others.

► Harold Koontz defines as “Management is the process of designing and

maintaining an environment in which individuals working together in groups,
efficiently accomplish selected aims.

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The Basic definition needs to be expanded

▪ As Managers, people carry out the Managerial functions of

planning, Organizing, staffing, leading and Controlling

▪ Management applies to any kind of organization [Business,

Governmental Agency, Hospital, University]

▪ It applies to managers at all organizational levels

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Nature and Characteristics of Management

Multidisciplinary Group activity

Continuous process Aims at obtaining wealthy results

Skills and Experience in getting
Universal activity
things done through people
Science as Well as an Art System of authority

Dynamic and not Static Intangible

Profession Good Leadership

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Functional areas of Management

► Financial Management
► Human Resource Management
► Marketing Management
► Production Management
► Material Management
► Purchasing Management
► Maintenance Management
► Office Management
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Objective of Management

► Getting maximum results with minimum efforts.

► Increasing the efficiency of factors of production
► Maximum prosperity for employer and employees
► Human betterment & Social Justice
► Reduces Cost
► Establishes Equilibrium
► Establishes Sound Oragnization

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Function of Management

► According to George & Jeery

► Planning, Organizing, Actuating, & Controlling

► According to Henry Fayol

► Plan, Organize, Command & Control

► Luther Gullick (POSDCORB)

► Planning, Organizing, Staffing, Direction, Coordinating , Reporting, & Budgeting

► Koontz & O’DONNEL

► Planning, Organizing, Staffing, Directing, & Controlling

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Function of Management

Planning Organising Staffing Directing Controlling

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Planning

► What to Do? When to Do? How to Do? Who is to Do?

► The planning process involves the following activities

► Determination of the goal of the Organization

► Formulating policies, rules, procedures etc. for the organization

► Forecasting the future based on past and present activities

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Organising

► Identification and analysis of activities required for the attainment

organisational objective

► Assignment of duties to the individuals concerned

► Follow up the activities

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Staffing

► Selecting candidate for position

► Fixing salary

► Training

► Developing them for effective organization function

► Performance Appraisal

► Promotions & Transfer

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Directing/Leading

► Guiding

► Supervising

► Motivation

► Leadership

► Communication

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Controlling

► Establishing standard

► Measuring current performance

► Comparing this performance to the established standards

► Taking corrective actions of deviation are detected

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Administration Vs Management

Attributes Management Administration

Art of getting things done through

others by directing their efforts Formulation of broad objective, plans
Definition
towards achievement of & Policies.
predetermined goals.
Decision Making function, Thinking
Nature Executing function, doing function
function
Decisions within the framework set by Major decisions of an enterprise as a
Scope
the administration. whole.
Levels of Authority Middle Level activity Top level activity
Group of managerial personnel who Consists of owners who invest capital
Status use their specialized knowledge to full in and receive profits from an
fill the objective of an enterprise. enterprise.
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Administration Vs Management

Attributes Management Administration

Popular with government, military,

Usage Used in business enterprise
education, and religious organization
Decisions are influenced by the values,
Influenced by public opinion, government
Influence opinions, beliefs and decisions of the
policies, customs etc.
managers
Main functions Motivating and controlling Planning and Organizing
Handles the business aspects such as
Abilities Handles the employees.
finance.

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Administration Vs Management

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Levels of Management

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Manager Vs Entrepreneur

ENTREPRENEUR MANAGER
• An Entrepreneur is a person who • A manager is the person
organize and manages a business responsible for planning and
undertaking, assuming the risk directing the work of a group of
for the sake of profit individuals, monitoring their work,
and taking corrective action when
necessary.

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Difference Between Manager and
Entrepreneur
CHARACTERISTIC ENTREPRENEUR MANAGER
Behaviour characterized by Desire for control Delegation of authority
Management style One man show Management team
Driving force Creativity-innovation Establish & preserve the status
Quo
Organizational growth Rapid reaction Strategic planning
Organization structure Informal, Flexible Organized
Decision making Intuitive Collect information & seek
advice

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Difference Between Manager and
Entrepreneur

CHARACTERISTIC ENTREPRENEUR MANAGER

Definition of Aims In terms of “Vision” In commercial Terms
Attitude to Money A By-Product Measure of Success
Attitude to risk Calculated Risks Avoidance of Risks
Organizational Culture “Entrepreneurial “Management Culture”
Culture”

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Types of Manager

► Purchase manager- Who is responsible for procuring the raw materials in a company

► Production manager- Who is responsible for managing the manufacturing process.

► IT manager- Who is responsible for supervising all computing and IT communication

related issues.

► Marketing manager- Who is responsible for supervising the promotion and advertising
of the company’s products/services.

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Types of Manager

► Sales manager- Who looks after the sales department and sets targets for sales personnel and
appraises their performance on the basis of the extent of target achievement

► Finance manager- Who is responsible for the financial management of the organization.

► Human resources manager- Who is responsible for the HR department and oversees all human
resource management functions

► Product development manager- Who is authorized with the management of the technical division
of new product design and product innovation.

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Managerial Skills

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Role of Manager
Henry Mintzberg (1973)

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Interpersonal

► Figurehead
► Symbolic head, obliged to perform a number of routine duties of a legal or social nature
► Leader
► Responsible for the motivation and activation of subordinates; responsible for staffing,
training and associated duties
► Liaison (Link)
► Maintains self-developed network of outside contacts and informers who provide
favors and information.

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Informational

► Monitor
► Seeks and receives wide Varity of special information to develop thorough understanding of
organization and environment; emerges as nerve internal and external information of the
organization.
► Disseminator
► Transmits information received from outsiders or from other subordinates to members of the
organization.
► Spokesperson
► Transmit information to outsiders on organization’s plans, policies, actions, results, etc.,

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Decisional

► Entrepreneur
►Searches organization and it environment for opportunities and
initiates :improvement projects” to bring about change; supervises design of
certain projects as well.
► Disturbance handler
►Responsibility for corrective action when organization faces important,
unexpected disturbance.
► Negotiator
►Responsible for representing the organization at major negotiations
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Evolution of Management Thought

► Pre Scientific Management Era (Before 1880)

► Classical Management Era (1880 – 1930)

► Neo Classical Management Era (1930 – 1950)

► Modern Management Era (1950 on word)

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► Classical Management Era (1880 – 1930) ► Modern Management Era (1950 on word)

► Scientific Management School ► Social System School

► Administration Management School ► Decision Theory School

► Bureaucracy Management
► Quantitative Man Management School

► Neo Classical Management Era (1930 – 1950) ► System Management School

► Human Relational School

► Contingency Management School

► Behavioral Management School

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Scientific Management School
Frederick Winslow Taylor 1856 – 1915

► Father of Scientific Management

► Midvale steel, Simonds Rolling Machine Bethleham steel

(Apprentice Machinist, Chief Engineer)

► It is an Art of knowing exactly what you want your men to do

and seeing that they do it in the best and cheapest way.

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Principles of Scientific Management

1. Replacing rules of thumb with science (Enquire, investigation, data collection, analysis and

framing a rule)

2. Obtaining harmony in group action, rather than discord

3. Achieving cooperation of human beings, rather than chaotic individualism

4. Working for max. output rather than restricted output

5. Developing all workers to the fullest extent possible for their own and their company’s highest

prosperity
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Techniques of Scientific Management

► Time Study

► Fair Day’s Work = Standard Time + Working Hours

► Motion Study

► Standardization

► Differential Piece Wage Plan

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Criticism

WORKER’S VIEWPOINT EMPLOYER’S VIEWPOINT

► Unemployment
► Expensive
► Weakening of trade union
► Time consuming
► Monotony

► Over speeding

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Administrative Management
Henri Fayol (1841 – 1925)

❑ Father of modern operational management theory

❑ Worked in French mining and metallurgical company

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14 Principles

1. Division of labour – Divided & Subdivided and allotted to various persons according to their expertise
in a particular area.

2. Authority and Responsibility

3. Discipline – Sincerity, Obedience, Diligence, Correct attitude

4. Unity of Command – receive order from one superior

5. Unity of direction – similar activities should be grouped

6. Subordination of Individual’s interest to the common goal

7. Remuneration – Fair and equitable

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14 Principles

8. Centralization & Decentralization– balance between concentration and dispersal of authority

9. Scalar Chain – Chain of authority from top to bottom

10. Order – ‘A place for everything and everything in its place’

11. Equity – Sense of fair play and justice

12. Stability of tenure of personnel – too much of turnover of staff/job rotation interfere the stability

13. Initiative – Subordinate initiatives

14. Esprit de crops – Team spirit should be fostered and administrated

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Elton Mayo and F. Roethlisberger and the
Hawthorne Studies

► Western electric company – 1927 to 1932

► 1924 to 1927, National Research Council –>Nature of illumination and other conditions 🡪 Productivity

► Changing illumination, modifying rest periods, Shortening workdays and varying incentive pay system did not
improve productivity.

► In general, that the improvement in productivity was due to such social factors as morale, satisfactory
interrelationships between members of a work group (a "sense of belonging"), and effective management--a kind

of managing that would understand human behavior, especially group behavior, and serve it through such

interpersonal skills as motivating, counseling, leading, and communicating.

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Recent Contributors of Management

► Peter F.Orucker (1974) – writer on many general management topics

► W.Edward Deming – Introduce QC in Japan

► Laurence Peter – People get promoted to a level where they are incompetent, and no further
promotion is possible

► William ouchi (1981) – Discussed selected Japanese managerial practices adapted in the US
environment

► Thomas peters and Robert Waterman – Identified Characteristics of companies they considered
excellent
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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

EMPIRICAL OR CASE APPROACH

Studies experience Situations are all

through cases. Identifies different. No attempt
successes and failures to identify principles

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

MANAGERIAL ROLES APPROACH

1.
10 roles were identified
Figure head role
Some activities are
2.
3.
Leader role
Liason role
not managerial. Some
4. Recipient role activities were left
5. Disseminator role
6. Spoken person role out (e.g. Appraising
7.
8.
The entrepreneurial role
The disturbance handler role
Managers)
9. Resource allocator role
10. Negotiator role

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

CONTINGENCY OR SITUATIONAL APPROACH
Management practice There is no best way to
depends on do things. Difficulty in
Circumstances determining all the
relevant contingency
factors and showing their
relationships

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

MATHEMATICAL OR MANAGEMENT SCIENCE APPROACH
Management is seen as Many aspects of
the mathematical managing cannot be
process, concepts, modeled
symbols & models

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

DECISION THEORY APPROACH
Decision making as a There is more to
spring board to study managing than
all enterprise decision making. The
activities focus is at the same
time too narrow and
too wide

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

REENGINEERING APPROACH
Fundamental rethinking Neglect external
Process analysis environment ignoring
Radical redesign customer needs
Dramatic results. neglect human needs.
Ignores total
Management systems

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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

SYSTEMS APPROACH
Systems have It is a new
boundaries but approach to
they also interact Management
with external
environment

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APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

SOCIO TECHNICAL SYSTEMS APPROACH
Technical system has Emphasis only on
great effect on blue collar and
social system lower level office
work

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APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

COOPERATIVE SOCIAL SYSTEMS APPROACH
Concerned with Too broad a field
interpersonal and for the study of
group behavioral Management
aspects leading to a
system of Co-
operation
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APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

GROUP BEHAVIOR APPROACH
Emphasis on Often not
behavior of people integrated with
in groups. Based management
on sociology and concepts,
social psychology Principles, theory
and techniques
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APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

INTERPERSONAL BEHAVIOR APPROACH
Focus on interpersonal Ignores planning,
behavior, human Organizing and
relations, leadership Controlling.
and motivation. Based Psychological
on individual training is not enough
psychology to be an effective
manager
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APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

McKINSEY’S FRAME WORK APPROACH
7 SKILLS The terms used are
1. Systems not precise and topics
2. Style
are not discussed in
3. Staff
4. Shared Values depth
5. Skills
6. Strategy
7. Structure
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A Management Theory Jungle?
APPROACHES TO MANAGEMENT

Characteristics Limitations Illustration

TOTAL QUALITY MANAGEMENT APPROACH
Dependable satisfying products & No complete agreement of
services (Deming) what TQM is
Product or services that is fit for
use (Juran)
Conformance to quality
requirements (Crosby)
• Continuous improvement
• Team Work
• Quality education

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The Management Process or Operational
Approach

▪ This approach draws together the pertinent knowledge

of management by relating it to the managerial job--
what managers do

▪ It tries to integrate the concepts, principles, and

techniques that underlie the task of managing
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The Systems Approach to The Management
Process

► A model of process or operational management that indicates how the various inputs are
transformed through the managerial functions of planning, organizing, staffing, leading,
and controlling.

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The Systems Model
of Management

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Inputs and Claimants

►The inputs from the external environment

may include people, capital, managerial
skills, as well as technical knowledge and
skills.

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The Managerial Transformation Process

►The task of managers is to transform the inputs,

in an effective and efficient manner, into outputs.

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The Communication System

►Communication integrates the managerial functions. It is

through communication that one determines whether
events and performance conform to plans. It is
communication that makes managing possible.

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External Variables

Effective managers regularly scan the

external environment.

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Outputs

Products, services, profits, satisfaction, integration

of the foals of claimants to the enterprise.

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Reenergizing the System

In the systems model of the management process,

some of the outputs become inputs again.

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Types of Organization
(Business Organization)

Business Organization

Proprietorship Partnership Corporation

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Individual Proprietorship

► Single person owns the capital

► He has taken the decision, uses his own skill , Knowledge and
experience
► All profits belong to him
► He bear all the losses
► His decision is final in employment, purchase production and sale
► Small establishments 🡪Started easily
🡪Closed down easily
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Individual Proprietorship

► The area of operation is limited, the owner can develop cordial

relationship with workers, supplier of inputs and buyers.

► Capital base is small and narrow

► Small business promotes fair distribution of income and

wealth.

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Partnership

► Formed by a simple contract

► Each party of the contract becomes the general agent of the business
► Sharing their duties responsibility on one hand & profit / losses on the other hand
► Minimum two persons
► In the absence of any agreement to the contrary , all partners have equal right to participate the
business
► Written agreement is signed by all partners and stamped it becomes partnership deed
► Registered firms enjoy many benefits
► Unregistered firms cannot sue other partners of the firm.

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ADVANTAGES OF
Partnership

⮚ Raising Additional Finance

⮚ Specialized experiences of various partners

⮚ Bankers provide easy credit

⮚ Liability is unlimited
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DISADVANTAGES of
Partnership

►Partners become responsible for acts of each & every other

►It suffers uncertain continuity, lesser public confidence, restricted

right to transfer of capital and liability of partner even after his
retirement from the firm.

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JOINT STOCK COMPANIES

o Corporation has been defined as an artificial person

o Recognized by law, it is a legal entity
o Distinctive name, a common seal
o Common capital
o Transferable shares of fixed value, limited liability
o Share holders may come & go, but company goes
o Share holders cannot participate the working of a company
o Board of directors, assisted by professional Mangers
o Memorandum of Association is prepared
o Classified as Pvt Ltd & Public Ltd
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Pvt. Ltd Company

⮚ Registered by 2 or more persons

⮚ But limits to 50
⮚ Restriction on transfer of shares
⮚ General public cannot participate in the capital
⮚ Limited liability
⮚ Keep their business as private as possible

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PUBLIC LIMITED COMPANY

►Membership is open to all

►Minimum no is 7, but there is no ceiling
►To collect capital, through the selling of shares

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FORMATION

❖ Group of persons conceive an idea of a successful business,

called promoters
❖ Registration to Registrar of companies with name and fee,
accompanied by Memorandum of Association (MOA) &
Article of Association (AOA)
❖ MOA defines objectives, powers of the company, the name
clause, situation clause, objective clause, capital clause and
liability clause
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FORMATION

❖ AOA 🡪 Rules & Regulations governing internal management (Power & duties
of directors and other officers, borrowing powers, power to hold meetings etc)

❖ After the meeting of directors, Chairman, Bankers, auditors, brokers etc are
appointed

❖ Then they raise the capital from general public

❖ Then registrar issues commencement certificate

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78

COMPANY

►Liability is limited as per the face value of shares

►Easily raise the capital from public and lending

institutions

►Avail the services of experts

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79

COMPANY

►Long drawn process

►More legal formalities

►Larger amount of initial expenditure

►Ownership is diverted from control

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CO - OPERATIVES

▪ Voluntary association of eleven or more members

▪ They are in same locality carrying on business not for profit
▪ It is based self help through mutual aid
▪ The membership is open to all
▪ Value of the share is kept low
▪ In India we have credit cooperatives, marketing cooperatives,
housing cooperatives etc.
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PUBLIC SECTOR UNDERTAKINGS

►Government departmental organizations

►Public Corporations

►Mixed ownership Corporations

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Government Department Organization

► Postal & Telegraphs, railways,highways, defence industries etc.

► They are financed by appropriations from the treasury

► It is subject to budget accounting and audit controls

► Civil servants are the in charge of such enterprises

► It cannot be sued without the consent of the government

► They ensure maximum degree of control

► Transactions are approved by appropriate agencies

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Government Department Organization

►Absence of flexibility in its operations

►Immediate decisions depending on the business environment

cannot be made

►Delay, red tapism, inadequate services etc are in this

organizations
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PUBLIC CORPORATIONS

► It is wholly owned by the state

► Greater freedom in making contracts, acquiring & disposing of property than government
departments
► They obtain funds from treasury, public and revenues from sale of goods and services
► They are not subject to budget accounting & audit loss
► Employees are recruited and remunerated under the terms and conditions of the corporation
► It enjoy the freedom of govt. regulation & control
► High degree of operating & financial flexibility
► Expansion programmes can be finance without delays by the use of revenues or borrowed
funds
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MIXED ENTERPRISES

► Capital owned by the Govt. & Pvt. share holders

► Directors are nominated by both of them
► It can enter into contract and acquire property in their own name
► Own legal entity
► They can be sued and they can sue
► Exempted from budget accounting
► Permission from GOI is necessary

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MIXED ENTERPRISES

► If foreign Participation
► If no foreign participation,
State – 25%
state Govt. or SIDC – 26%
Indian entrepreneurs – 20%
Private Individual - 25%
Foreign Investor – 20% &
Lending Institutions - 49%
Investing public – 35%

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GLOBALIZATION

It means internationalization of trade, Particularly financial product

transactions and the integration of economic and capital markets
throughout the world

►Trade exists freely among the countries

►World economy becomes a single market or single economy

►In globalization, there is no restriction of quota, license, tariff and

other adminstrative barriers for trade
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GLOBALIZATION

Trade can be of products and factors

► Trade of product means goods, commodities and services
► Trade of factors means transfer of technology, finance and
labour
► Currencies of the country should be freely exchangeable
► Uniformity of laws and rules
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Benefits of Globalization

1. Improves efficiency – >Glob. leads to specialization in production

2. Improve factor income –>the factor mobility is free (factor incomes among the
trading countries will get equalized)
3. Improves finance –> need for growth and industrialization of country
4. Gain from migrations
* For developed countries migration fulfills the need of manpower in the form of
skilled person
* For developing countries migration solves the problem of unemployment
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International Management /Managing Globally

►It is the process of Planning, Organizing, leading and controlling in

organizations engaged in international Business

►Now a days Managers engage in international business are like to face

competition from international organizations or to deal with them either
suppliers or customers

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Multinational Corporations (MNC)

►It is an organization that is engaged in production or services through

its own association in several countries, manages and control the overall
activities from a global perspective
►They are large in size and are engaged in substantial amount of business
throughout the world

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Multinational Corporations (MNC)

► MNC is a business that has its head quarters (domicile) in one country but which
operates in many

► The BOD (Board of Directors) might comprise a two tier system

►Strategic board which determines global policy

►One or more national boards responsible for implementing this policy in

particular countries
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Major Differences between MNC & one country Firm

a) Market segment is more for MNC

b) Recruitment, training, appraisal and promotion procedures must be drafted on international scale
c) Greater amount of diversification
► Choice of national market for final products
► Location of production facilities
► Sources of raw materials
► Buy and import (products) from rest of the world
d) MNC can afford more risk than domestic rivals. A loss in one country can be offset against profits
elsewhere.

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Categories
Horizontally Integrated Multinational

► MNC Seeks to produce the same product in different countries. The primary objective is to achieve growth by
expanding into new markets

Vertically Integrated Multinational

► MNC Undertakes the various stages of production in different countries for a core business.
Ex: Oil companies like shell and Exxon (ESSO)

Conglomerate Multinational
► MNC will produce a range of different products in different countries

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Type of International Management

►Ethocentric

►Polycentric

►Regiocentric

►Geocentric

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Ethnocentric

International Management are home country oriented. Here,

Managers assume that practices that work in home country must

necessarily work elsewhere

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Polycentric

International Management are host country oriented

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Regiocentric

International Management are region

oriented. Managers believe that the company
problems related to that region are generally
best solved by individuals from the region.
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Geocentric

International Management are world oriented. Here

Managers believe that global view is needed in both the head quarters
of the company and its various subsidiaries that the best individuals
regardless of host or home country, should be utilized to solve
company problems anywhere in the world.
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Entry to International Business

1. Exporting : It is the process of making a product in the home country

and sending it overseas. It requires very small capital.
2. Licensing : It is an agreement in which one organization gives limited
rights to another to use certain assets (expertise, patents, copyrights or
eqpt.) for an agreed upon fee or royalty
► Licensing allows to use assets within specific territory and for a
specific period

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Entry to International Business

3. Establishing Strategic alliances: A joint venture is an agreement involving

two or more organizations that arrange to produce a product or service
through a jointly owned enterprises
4.Operating wholly owned subsidiaries: A wholly owned subsidiary is an
operation on foreign soil that is totally owned and controlled by a
company with headquarter outside the host country.

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MNC STRATEGIES

► MNC must give weightage to two important factors.

i. The need to make optimum economic decisions on global basis.
ii. Responsive to host country differences
MNC opt for any of the four strategy
a. Worldwide integration / globalization strategy
b. National responsiveness strategy
c. Region responsiveness strategy
d. Multifocal strategy
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Challenges of Management in Global Scenario

a) Language Barriers – Less in developed country

- More in developing countries (Africa or Latin America)
b) Selling and Marketing in Foreign Markets
Selling at home might fail overseas because of wide social
and cultural differences.
Ex: McDonald’s, Cocacola
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Challenges of Management in Global Scenario

c) Attitudes of host governments

Govt. insisting on part ownership in the subsidiary of tight rules and

regulations governing the MNC’s behavior or harsh tax regimes

d) Communication and Co-ordination between subsidiaries

For expanding global business, lines of communication become

longer and more complex. 7/21/2020
 105

Advantages of MNC Investment

►Employment

►The Balance of Payment

►Technology Transfer

►Taxation
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Disadvantages of MNC Investment

►Uncertainty

►Control

►Transfer Pricing

►The Environment
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Japanese Management

►They combine structure and people with

Japanese culture to create a highly productive
and efficient organization.

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Characteristics of Japanese
management or Theory Z

1. Human Resources : Japanese Management prefers human resource than financial

resources

2. Job Security : It results in employees with high morale

3. Team work : team efforts & Team spirit leads to effective management

4. Promotion : Promotion are based on seniority

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Characteristics of Japanese
management or Theory Z

5. Appraisal System : Employee performance in the long run is given

more importance than short run.
6. Communication : It is designed to foster open communication. It
facilitates extensive face to face communication.
7. Decision Making : Japanese management encourages the lower level
employees ideas, Knowledge & Experience.
Lower level employees also take part in decision making

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Weakness of Japanese Management

1. It suppressed individual talents

2. Promotion policy is not encouraging outstanding younger
employees
3. Decision making process is time consuming process

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Japanese Management USA Management

It involves long term planning It Involves short term planning
More people involved in decision Only top executives involved in
making process decision making process
More favor for decentralization More favor for centralization
Participative Management Not a Participative Management
Here informal and democratic Formal and bureaucratic organization
organization structure structure
Training is important activity Training is not an important
Job Security Job Insecurity
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Japanese Management USA Management

Leader is not a important role Leader is a important role
It enhances self control and peer control All Managerial activities controlled by
superiors
Execution of all the process in the Execution of all the process in the
organization is very fast organization is not fast
Given more benefits to the employees Employees benefits less compared to Japan
Appraisal process is not consider immediately Appraisal process is consider immediately
It enhances group performance It enhances individual performance
Promotion, demotion and termination process Promotion, demotion process is often
are less
Communication system is poor Communication is effectively
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German Management

►German Management is autocratic

►The Managers expect obedience from their subordinates
►Labour suggestions also accepted
►One of the labour director is elected as a member of the executive
committee.
►Managerial decisions are taken by the executive committee in
consultation with labour director
►Labour director is represented the employee’s problems also 7/21/2020
 114

ORGANIZATIONAL CULTURE

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 115
Importance of Organizational Culture

► Talent Attractor

► Talent Retainer

► Engage People

► Creates Energy and Momentum

► Changes the View of Work

► Creates Greater Synergy

► Makes Everyone More Successful

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CHARACTERISTICS OF
116
ORGANIZATIONAL CULTURE Degree to which employee are
expected to exhibit precision
analysis and attention to detail
Degree to which managers
focus on results or outcomes
Attention in
rather than on ho these
Detail outcomes are achieved

Innovation
Outcome
and Risk
Orientation
Degree to which employee are Taking
encouraged to be innovative and
take risk

Organizational Culture
People
Stability
Orientation Degree to which management
decisions take into account the
Degree to which organizational
effects on people in the
decisions and actions emphasize
organization
maintaining the status quo

Team
Aggressiveness
Degree to which employees are Orientation
aggressive and competitive rather
than cooperative Degree to which work is
organized around teams rather 7/21/2020
than individuals
ELEMENTS OF ORGANIZATIONAL CULTURE 117

Artefacts
Language, Technology, Products, Style
of dressing, Physical Environment,
Manners, Myths, stories

Espoused Values
Conscious Strategies, goals and
philosophies

Basic Assumptions and Values

Norms, Unwritten rules, shared assumptions, taken for
granted beliefs, values existing at unconscious level

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STRONG vs WEAK CULTURE

Strong culture Weak culture

► Strong culture-key values are ► Weak Culture-do not make clear
deeply held and widely shared. what is important and what is not
► Employees in such organizations ► Lack of clarity in organization
are more committed
► Increased organizational
performance.

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HOW AN ORGANIZATION’S CULTURE
119

IS ESTABLISHED AND MAINTAINED?

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 120

HOW EMPLOYEES LEARN CULTURE

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ORGANIZATION AND 121

ENVIRONMENTAL FACTORS
Organization environment

Internal
factors

environment General environment or

External Macro environment.
environment Task environment or micro
environment

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Internal Environment factors

► Management

► Organizational culture

► Employee

► Financial changes

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 123

External Environment factors

Macro Environment Micro Environment

► Technology ► Suppliers

► Economic conditions ► Customers

► Political conditions ► Competitors

► Socio-cultural factors ► Distributor

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 Current trends and Issues in 124

Management
Work force diversity
Changing demographics of workforce
Internal environment
Changing employee expectations
Building organizational capabilities
Technological advances
Changing psycho-social system
Job design and organizational capabilities
Management of human relations
Change in legal environment and industrial relation
Globalisation 7/21/2020