2015 (August)
COMMERCE
Paper: 102
(Organisational Behaviour and Theory)
Full Marks – 80
Time – Three Hours
The figures in the
margin indicate full marks for the questions.
Answer all the
questions.
1. (a) Discuss the
various types of organisation. To what extent sound organisation helps in
effective management? 9+7=16
Ans: TYPOLOGIES OF ORGANISATION
Some scholars based on size, ownership, legal status and the area
of operation have classified organisation. Another set of scholars has
classified the organisation based on function or purpose, primary beneficiary,
consumer and authority. Now we will be discussing about the classification
based on the latter set of scholars.
a)
Typologies by Goal or Function or Purpose
Talcott Parsons has classified organisations into four types on
the basis of their functions or goal served by the organisation. The four types of organisations are:
i) Production/Economic Organisation: these types of organisations
produce goods or make things which are consumed by the society.
ii) Political Organisation: these types of organisations are
concerned with the attainment of political goals. They generate and allocate
power within the society and also maintain peace and stability in the society.
Legislature and government departments are examples of such organisations.
iii) Integrative Organisations: These organisations try to settle
conflicts, integrate and coordinate various segments of the society to work
together and provide stability in the society. Judicial courts, police, and
social agencies are examples of this type of organisation.
iv) Pattern Maintenance Organisation: These organisations are concerned with the
societal continuity with a focus on long-term issues such as of society’s
values, patterns, knowledge, culture, etc. through the educational, cultural
and religious institutions.
Katz and Kahn have also classified organisations into four types
based on the functions or goals served by the organisation. The four types of
organisations are:
(i) Production or Economic Organisation: These organisations are
concerned with the manufacture of goods, provision of essential services to the
people and also building up of infrastructure. Their focus is on creation of
wealth.
(ii) Managerial or Political Organisation: These organisations are
concerned with adjudication; coordination and control of resources; people; and
sub-systems.
(iii) Adaptive Organisation: These organisations provide
opportunities for creation of knowledge, testing and development of theories
and also provide information and solutions to the existing problems.
Universities and research institutions are examples of these organisations.
(iv) Maintenance Organisation: These organisations give space and
scope and devote to the socialization of people for their roles in other
organisations and in the larger society. Schools, church, and health and
welfare institutions are examples of this type of organisation.
b)
Typologies on the Bases of the Consumer or Primary Beneficiary Blau and Scott
They classified the organisation based on the primary recipient of
the output or who benefits. The main basis for this classification is who the direct
consumer of the output of the organisation is, or who the prime beneficiary is.
Four types of organisation are derived on this basis:
(i) Mutual Benefit Association: In this type of organisation the
primary beneficiaries are the members themselves. Political parties, trade
unions, professional associations and religious bodies are examples of these
organisations.
(ii) Business Organisations or Business Concerns: In this type of
organisation the owners of properties are the prime beneficiaries of the organisation.
They are mostly concerned about the return on investment in the organisation
than with the nature of output of the organisation. The other main concern is
that of operating efficiently to make the maximum profit at minimum cost. In
order to survive they have to compete with other organisations.
(iii) Service Organisations: In this type of organisation the
clients who are served are the prime beneficiaries. Hospitals, educational
institutions, social work agencies legal aid societies, etc. are examples of
these organisations.
The clients who are supposed to be the primary beneficiaries do not have usually control over these organisations.
The clients who are supposed to be the primary beneficiaries do not have usually control over these organisations.
(iv) Commonwealth Organisations: In this type of organisation the
public at large is its primary beneficiary. Post office, police service, fire
department, military service are examples of these types of organisations. They
perform mostly protective services or serve as its administrative arm.
c)
Typologies on the Basis of Compliance A. Etzioni: He differentiates organisation on the basis of compliance.
Compliance involves one party telling or directing another party to do
something. It refers to the manner in which the lower participants in an
organisation respond to the authority system of the organisation. In this
context, Etzioni identifies three types of power: coercive, utilitarian and
normative. Coercive power is based on the application or the threat of physical
sanction. Here compliance is alienated. Utilitarian power is based on control
over material resources. Here compliance takes a calculative or utilitarian
approach. Normative power based on the allocation of symbolic rewards. Here the
compliance is moral. Almost all the organisations would follow the three types
of authority, which combine three types of compliance.
d) Typologies
on the Basis of Authority: Max Weber
identifies three types of organisation on the basis of exercise of authority.
They are explained below:
(i) Charismatic Authority: In this type of organisation there will
be a leader and set of disciples or followers. Because of charisma or an
exceptional quality of the followers accept his authority or repose their faith
in the person. In this type of organisation the administrative apparatus is
very loose and unstable that is a built in instability.
(ii) Traditional Authority: In this type of organisation the
followers or employees accept the authority of a person who occupies the
traditionally sanctioned position of authority. The administrative apparatus in
this kind of domination would consist of personal servants, relatives and
feudal lords.
(iii) Legal or Rational Authority: In this type of organisation
people or followers accept the authority of a leader, which is based on the
belief in the rightness of law. It is legal because authority is exercised by
means of a system of rules and procedures by reason of the office, which an
individual holds. The administrative apparatus corresponding to this kind of
authority is bureaucracy.
Importance of Organising in effective
management
Organising
is the fundamental activity of management.
It is necessary for management to mobilize men machinery money and
materials or resources for achieving organisational objectives. Organising provides basis for other functions
of management, hence scientifically designed organisation helps manager to
function efficiently and effectively.
The importance of organisation may be explained as follows –
a)
Efficiency
of Management: A Good organisation helps in making optimum use of available
resources for achieving organisational objectives, increasing efficiency of
management.
b)
Facilities
Administration: A properly designed and balanced organisation facilitates both
management and operation of the enterprise.
c)
Facilitates
growth and diversification: On account of sound organisational
structure growth and diversification can be successfully achieved for improving
competitive strength of the organisation.
d)
Facilitates
Technological progress: Sound organisational structure is
useful for coping with technological changes which have become inevitable under
modern conditions.
e)
Encourages
healthy human relations: Scientific and balanced organisational
structure when manned by right type of people tends to motivate people through
job satisfaction that promotes healthy human relations in the organisation. It helps maintaining morale at a higher
level.
f)
Stimulates
initiative and creativity: Sound organisation stimulates
creative thinking and initiative by providing opportunities to experiment with
new ideas for developing new ways of doing things.
g)
Reduction
in work load of top management: Sound organisation stimulates
creative thinking and initiative by providing opportunities to experiment with
new ideas for developing new ways of doing things.
h)
Smooth
direction: In sound organisation right men are placed at right place hence
direction tends to become smooth and effective.
i)
Easy
communication: Every organisation has its own channels or methods of
communication. Effective communication
helps in effective management..
j)
Integration
of individual efforts to achieve organisational goals: The
functions, duties and responsibilities of the different departments are clearly
defined which helps in achieving organisational goals.
k)
Effective
control over employees: Each subordinate should have only
one superior. There should not be dual subordination. It helps in effective
control over the employees.
Or
(b) What are the
various approaches to organisation analysis? What are the components involved
in systems analysis? 8+8=16
Ans:
Various approaches to organisation analysis
a) THE BEHAVIORAL Or SITUATIONAL APPROACH:
The behavioral approach of management thought developed, in part, because of
perceived weaknesses in the assumptions of the classical approach. The
classical approach emphasized efficiency, process, and principles. Some felt
that this emphasis disregarded important aspects of organisational life,
particularly as it related to human behavior. Thus, the behavioral approach focused
on trying to understand the factors that affect human behavior at work.
(i) Human Relations: The Hawthorne
Experiments began in 1924 and continued through the early 1930s. A variety of
researchers participated in the studies, including Elton Mayo. One of the major
conclusions of the Hawthorne studies was that workers' attitudes are associated
with productivity. Another was that the workplace is a social system and
informal group influence could exert a powerful effect on individual behavior.
A third was that the style of supervision is an important factor in increasing
workers' job satisfaction.
(ii) Behavioral Science: Behavioral
science and the study of organisational behavior emerged in the 1950s and
1960s. The behavioral science approach was a natural progression of the human
relations movement. It focused on applying conceptual and analytical tools to
the problem of understanding and predicting behavior in the workplace. The
behavioral science approach has contributed to the study of management through
its focus on personality, attitudes, values, motivation, group behavior,
leadership, communication, and conflict, among other issues.
b) THE QUANTITATIVE APPROACH: The
quantitative approach focuses on improving decision making via the application
of quantitative techniques. Its roots can be traced back to scientific
management.
(i) Management Science: Management
science (also called operations research) uses mathematical and statistical
approaches to solve management problems. It developed during World War II as
strategists tried to apply scientific knowledge and methods to the complex
problems of war. Industry began to apply management science after the war. The
advent of the computer made many management science tools and concepts more
practical for industry
(ii) Production And Operations Management:
This approach focuses on the operation and control of the production process
that transforms resources into finished goods and services. It has its roots in
scientific management but became an identifiable area of management study after
World War II. It uses many of the tools of management science. Operations
management emphasizes productivity and quality of both manufacturing and
service organisations. W. Edwards Deming exerted a tremendous influence in
shaping modern ideas about improving productivity and quality. Major areas of
study within operations management include capacity planning, facilities
location, facilities layout, materials requirement planning, scheduling,
purchasing and inventory control, quality control, computer integrated
manufacturing, just-in-time inventory systems, and flexible manufacturing
systems.
c) SYSTEMS APPROACH: The systems
approach focuses on understanding the organisation as an open system that
transforms inputs into outputs. The systems approach began to have a strong
impact on management thought in the 1960s as a way of thinking about managing
techniques that would allow managers to relate different specialties and parts
of the company to one another, as well as to external environmental factors.
The systems approach focuses on the organisation as a whole, its interaction
with the environment, and its need to achieve equilibrium.
d) CONTINGENCY APPROACH: The
contingency approach focuses on applying management principles and processes as
dictated by the unique characteristics of each situation. It emphasizes that
there is no one best way to manage and that it depends on various situational
factors, such as the external environment, technology, organisational characteristics,
characteristics of the manager, and characteristics of the subordinates.
Contingency theorists often implicitly or explicitly criticize the classical
approach for its emphasis on the universality of management principles;
however, most classical writers recognized the need to consider aspects of the
situation when applying management principles.
2. (a) “Authority is the legitimized power that is linked to each
position within the organisation.” Discuss. 16
Or
(b) When does a bureaucratic
organisation suffer from serious problems? Suggest whether it is feasible to
design an organisation free from bureaucratic elements. 9+7=16
3. (a) Compare and
contrast theory “X” and theory “Y”. What are the implications of these theories
on managerial practices? 9+7=16
Ans: McGregor’s
Theory X and Y
Doughlas McGregor introduced these two
theories i.e., Theory X and Theory Y, based on two distinct views of human
beings. He proposed, at opposite extremes, two pairs of assumptions about human
beings which he thought were implied by the actions of the mangers. Theory X
deals with one extreme, based on one set of assumptions and Theory y deals with
another extreme based on another set of assumptions. These theories are not
based on any research, but according to McGregor, these are intuitive deduction.
Theory X:
-This
theory is based on the traditional approach to human behavior. The assumptions
generally, held by the managers in their theory are: -
a) The
average human beings inherently dislike work and will try to avoid it, whenever
possible
b) A the employee
are lazy, they must be controlled, coerced, threatened with punishment to
achieve goals, to which they are indifferent
c) Average
employee will try to avoid responsibility and seek formal directions whenever
possible, because they have relatively little ambition.
Theory y:
-This
approach assumes that management by direction and control is questionable
method for motivating such people whose physiological and social needs have
been satisfied and whose social; esteem and self actualization needs are becoming
more important. For such people, Theory Y seems to be applicable, which is the
contrast of Theory X. This theory makes the following assumptions about people:
a)
The average human
being does not inherently dislike work. He can view work as natural or
enjoyable as rest or play
b)
Employees will
exercise self direction and self control in the attainment of the objectives to
which they are committed
c)
Given proper working
conditions, average person can learn to accept and even to seek responsibility
d)
Commitment to
objectives is a function of the rewards associated with their achievement
e)
All the people are
capable of making innovative and creative decision and the decision making is
not the sole province of the people in management position.
Or
(b) Define
Perception. Explain the perceptual process. What is the influence of perception
on behaviour? 6+10=16
Ans: Perception: Perception
is an important mediating cognitive process. Through this complex process,
people make interpretations of the stimulus or situation they are faced with.
Both selectivity and organization go 'into perceptual, interpretations.
Externally, selectivity is affected by intensity, size, contrast, repetition,
motion and novelty and familiarity. Internally, perceptual selectivity is influenced
by the individual's motivation, learning and personality. After the selective
process filters the stimulus situation, the incoming information is organized
into a meaningful whole.
Individual
differences and uniqueness are largely the result of the cognitive processes.
Although there arc a number of cognitive processes, it is generally recognized
that the perceptual process is a very important one. It is a process that takes
place between the situation and the behaviour and is most relevant to the study
of organizational behaviour. For example, the observation that a department
head and a subordinate may react quite differently to the same top management
directive can be better understood and explained by the perceptual process.
In
the process of perception, people receive many different kinds of information
through all five senses, assimilate them and then interpret them. Different
people perceive the same information differently.
Perception
plays a key role in determining individual behaviour in organizations.
Organizations send messages in a variety of forms to their members regarding
what they are expected to do and not to do. In spite of organizations sending
clear messages, those messages are subject to distortion in the process of
being perceived by organizational members. Hence, managers need to have a
general understanding of the basic perceptual process.
Basic Perceptual Process
Perception
is influenced by characteristics of the object being perceived, by the
characteristics of the person and by the situational processes.
a)
Characteristics of the
object include contrast, intensity, movement, repetition
and novelty.
b)
Characteristics of the person include
attitude, self-concept and personality.
The
details of a particular situation affect the way a person perceives an object;
the same person may perceive the same object very differently in different
situations. The processes through which a person's perceptions are altered by
the situation include selection, organization, attribution, projection,
stereotyping process, and the halo effect process. Among these, selective
perception and stereotyping are particularly relevant to organizations.
a)
Selective
Perception: Selective perception is the process of screening out
information that we are uncomfortable with or that contradicts our beliefs. For
example, a manager has a very positive attitude about a particular worker and
one day he notices that the worker seems to be goofing up. Selective perception
may make the manager to quickly disregard what he observed. For example, a
manager who has formed a very negative attitude about a particular worker and
he happens to observe a high performance from the same worker. In this case
influenced by the selective perception process he too will disregard it. In one
sense, selective perception is beneficial because it allows us to disregard
minor bits of information. But if selective perception causes managers to
ignore important information, it can become quite detrimental.
b)
Stereotyping:
Stereotyping is the process of categorizing or labeling people on the basis of
a single attribute. Perceptions based on stereotypes about people's sex exist
more or less in all work places. Typically, these perceptions lead to the
belief that an individual's sex determines which tasks he or she will be able
to perform. For example, if a woman is sitting behind the table in the office,
she will be very often, perceived as a clerk and not an executive at first. But
it would induce holding an exactly opposite assumption about a man.
Stereotyping consists of three steps: identifying categories of people (like
women, politician), associating certain characteristics with those categories
(like passivity, dishonesty respectively) and then assuming that any one who
fits a certain category must have those characteristics. For example, if
dishonesty is associated with politicians, we are likely to assume that all
politicians are dishonest.
4. (a) Define
Motivation. Indicate how management can successfully motivate people taking
clues from Vroom’s Valence Expectancy model. 6+10=16
Ans: The word
motivation is derived from ‘motive', which means an active form of a desire,
craving or need that must be satisfied. Motivation is the key to organisational
effectiveness. The manager in general has to get the work done through others.
These 'others' are human resources who need to be motivated to attain
organisational objectives.
According to George R. Terry,
"Motivation is the desire within an individual that stimulates him or her
to action."
According to
Berelson and Steiner “A motive is an inner state that energizes
activates, or moves and directs or channels behavior goals".
According to
Lills "It is the stimulation of any emotion or desire operating
upon one's will and promoting or driving it to action".
According to Encyclopedia of
Management "Motivation refers to
the degree of readiness of an organism to pursue some designated goals and
implies the determination of the nature and locus of force inducing a degree of
readiness."
Vroom’s Expectancy theory
Victor
Vroom made an important contribution to the understanding of the concept of
motivation and the decision process that people use to determine how much
effort they will expend on their jobs. He said that a person’s motivation
towards an action at any time would be determined by an individual’s perception
that a certain type of action would lead to a specific outcome and his personal
preference for this outcome. This model is based on the belief that motivation
is determined by the nature of the reward expect to get an a result of their
job performance. There are three variable in Vroom’s model given in the form of
an equation. Since the model is a multiplier, all the three variable must have
high positive value to imply motivated performance choices. If any of the
variable is zero the probability of motivated performance tends to be zero.
MOTIVATION = VALENCE X EXPECTANCY X
INSTRUMENTALITY
All these
three variable are explained as follows:
1)
Valence:
Valence means the attraction (or repulsion) of an outcome to the individual.
Whenever an individual has preference for a reward valence is the strength of
that preference.
2)
Expectancy:
Expectancy is also referred to as the Effort-Performance Probability. It refers
to the extent to which the person believes his efforts will lead to the first
level outcome i.e. completion of the task.
3)
Instrumentality
(Performance-Reward Probability): Instrumentality refers to the
probabilities attached by the individual to each possible performance-outcome
alternative just as the individual previously assigned probabilities to various
levels of effort leading to different levels of performance (expectancy).
The plus
points of this theory are:
a)
The expectancy model is highly useful in
understanding organizational behaviour. It can improve the relationship between
the individual and the organizational goals. This model explains how
individuals’ goals influence his efforts and like need-based models reveal that
individual behaviour is goal oriented.
b)
The expectancy theory is a cognitive theory,
which values human dignity. Individuals are considered rational human beings
who can anticipate their future on the basis of their beliefs and expectations.
c)
This theory helps the managers in looking beyond
what Maslow and Herzberg implied. According to him motivation does not mean
satisfying the unsatisfied needs. The managers must make it possible for an
employee to see that effort can result in appropriate need satisfying rewards.
Despite
these plus points, there are some drawbacks of Vroom’s expectancy model as
given below:
a)
Vroom’s theory is difficult to research and
apply in practice. This is evident by the fact that there have been a very few
research studies designed specifically to test Vroom’s theory.
b)
This theory assumes man to be a rational human
being who makes all the decisions consciously. But there are numerous instances
where decision are taken with no conscious thought. This is particularly true
for routine jobs.
c)
Although, it is an important theory of motivation
but it is quite complex. Many managers, in actual organizational situations, do
not have the time or sources to use a complex system on the job.
Or
(b) Explain the nature and functions of leadership based on the
following formula: L = f (1, f, s). Also suggest measures of effective
leadership. 16
Ans: Leadership is the ability to build up
confidence and deal among people and to create an urge in them to be led. To be
a successful leader, a manager must possess the qualities of foresight, drive,
initiative, self-confidence and personal integrity. Different situations may
demand different types of leadership.
Leadership means influencing the
behaviour of the people at work towards realizing the specified goals. It is
the ability to use non-coercive (no force) influence on the motivation,
activities and goals (MAG) of others in order to achieve the objectives of the
organisation.
Koontz and 0' Donnel “Leadership is the ability of a
manager to induce subordinates to work with confidence and zeal”.
George R Terry “Leadership is the
activity of influencing people to strive willingly for group objectives”.
Nature and
Characteristics of Leadership:
An
analysis of the definitions cited above reveals the following important
characteristics of leadership.
a)
Leadership is a personal quality.
b)
It exists only with followers. If there are no
followers, there is no leadership?
c)
It is the willingness of people to follow that
makes a person a leader.
d)
Leadership is a process of influence. A leader
must be able to influence the behaviour, attitude and beliefs of his
subordinates.
e)
It exists only for the realization of common
goals.
f)
It involves readiness to accept complete
responsibility in all situations.
g)
Leadership is the function of stimulating the
followers to strive willingly to attain organisational objectives.
h)
Leadership styles do change under different
circumstances.
i)
Leadership is neither bossism nor synonymous
with management.
Functions of Leadership
The important
functions of leadership:
1)
It
improves motivation and morale: Through dynamic leadership managers can
improve motivation and morale of their subordinates. A good leader influences
the behaviour of an individual in such a manner that he voluntarily works
towards the achievement of enterprise goals.
2)
It acts
as a motive power to group efforts: Leadership serves as a motive power to
group efforts. It leads the group to a higher level of performance through its
persistent efforts and impact. On human relations.
3)
It acts
as an aid of authority: The use of authority alone cannot always bring the
desired results. Leadership acts as an aid to authority by influencing,
inspiring, and initiating action.
4)
It is
needed at all levels of management: Leadership plays a pivotal role at all
levels of management because in the absence of effective leadership no
management can achieve the desired results.
5)
It
rectifies the imperfectness of the formal organizational relationships: No
organizational structure can provide all types of relationships and people with
common interest may work beyond the confines of formal relationships. Such
informal relationships are more effective in controlling and regulating the
behaviour of the subordinates. Effective leadership uses these informal
relationships to accomplish the enterprise goals.
6)
It
provides the basis of co-operations: Effective leadership increases the
understanding between the subordinates and the management and promotes
co-operation among them.
Essentials of good
leadership
1.
Patience: Patience is the capacity to face difficult
situations, hardships or inconvenience without making a single complaint. A
good leader must show patience while waiting for expected results, facing
difficult situations and taking important decisions. He must avoid taking hasty
decisions and actions.
2.
Good Personality: A good personality is a combination of
physical, mental and social qualities. Good personality helps a leader to
influence his followers. Attractive physique and good manners add an advantage
to the leader's personality.
3.
Self-confidence: A good leader must have self confidence. This
quality is necessary for facing challenging situations and for solving problems
easily and effectively.
4.
Human Skills: A good leader must have essential social and
human skills. That is, he must understand people. This quality is necessary for
dealing with different types of persons and social groups.
5.
Judgment skills: A good leader should be able to examine problems in right perspective.
His judgment and decision making abilities should be superior to others. He
should be able to form opinions and judge based on facts and not be prejudiced
6.
Communication skills: A good leader should be able to communicate the goals and procedures of
the organisation clearly, precisely and effectively to the subordinates. Only
then will it be possible for him to convince, persuade and stimulate
subordinates to action.
7.
Listening skills: People tend to avoid a leader who does not listen. Hence a good leader
in one who can listen to other peoples problems. He should be able to create a
culture whereby people can be frank with him and give him information and also
give him feedback about himself, which can help him to improve himself.
8.
Inspiring skills: A good leader should be able to inspire people to deal with the “why”
question. He should not just command and control but be able to lead the people
and get them involved to work together as a team.
9.
Administrative Skills: A good leader must have an administrative
ability. This means, he must be able to get the work done through his followers.
He must know how to plan, organize and control the work of his followers.
10. Discipline: A good leader must be a disciplined person.
This means he must have respect for the rule and regulations of the
organisation. This is because his followers will follow his example.
11. Initiative: A good leader must always take an initiative.
This means he should do the right thing at the right time without being told by
others. He must be able to construct and implement his own plan.
12. Intelligence: A good leader must be smart and intelligent.
That is, he should have a good educational background and sound technical
knowledge. He should be more intelligent than his followers. If not, his
followers will not respect him. This will have a bad effect on his performance.
13. Innovative: A good
leader must have an art of innovation. That is, he must have a good imagination
and visualization skills. He must develop new ideas and tactics to solve
problems. He must combine the new ideas with the old ideas.
5. (a) What criteria are used for
judging the effectiveness of an organisation? How does the degree of
integration of goals affect organisational accomplishment? 8+8=16
Or
(b) “Persistence to change is a normal
part of the process of change”. Discuss. What techniques would you use in
overcoming such resistance? 9+7=16
***
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