IGNOU B.Com Solved Question Paper
Term-End Examination (June,
2019)
ELECTIVE COURSE:
COMMERCE
ECO-003: MANAGEMENT
THEORY
Time: 2 hours (Maximum
Marks: 50)
(Weightage: 70%)
Note: Attempt both the
Sections, A and B.
SECTION
A
Attempt any three
questions:
1. Explain briefly the
evolution of management thought. 12
Ans:
Evolution of management thoughts
The
practice of management is as old as human civilization. The ancient
civilizations of Egypt (the great pyramids), Greece (leadership and war tactics
of Alexander the great) and Rome displayed the marvelous results of good
management practices. The origin of management as a discipline was developed in
the late 19th century. Over time, management thinkers have sought ways to
organize and classify the voluminous information about management that has been
collected and disseminated. These attempts at classification have resulted in
the identification of management approaches. The approaches of management are
theoretical frameworks for the study of management. Each of the approaches of
management are based on somewhat different assumptions about human beings and
the organisations for which they work. The different approaches of management
are:
a) Early management approaches
represented by scientific management (Classical approach or Theories)
b) Modern management approaches
represented by behavioral science movement, quantitative approach, systems
approach and Contingency approach (Neo-classical approach or theories)
a) THE CLASSICAL APPROACH: The classical approach is the oldest formal
approach of management thought. Its roots pre-date the twentieth century. The
classical approach of thought generally concerns ways to manage work and
organisations more efficiently. Three areas of study that can be grouped under
the classical approach are scientific management, administrative management,
and bureaucratic management.
(i) Scientific Management: Frederick Winslow Taylor is known as the father of scientific management. Scientific management (also called Taylorism or the Taylor system) is a theory of management that analyzes and synthesizes workflows, with the objective of improving labor productivity. In other words, Traditional rules of thumb are replaced by precise procedures developed after careful study of an individual at work.
(ii)
Administrative Management: Administrative management focuses on the management
process and principles of management. In contrast to scientific management,
which deals largely with jobs and work at the individual level of analysis,
administrative management provides a more general theory of management. Henri
Fayol is the major contributor to this approach of management thought.
(iii)
Bureaucratic Management: Bureaucratic management focuses on the ideal form of
organisation. Max Weber was the major contributor to bureaucratic management.
Based on observation, Weber concluded that many early organisations were
inefficiently managed, with decisions based on personal relationships and
loyalty. He proposed that a form of organisation, called a bureaucracy,
characterized by division of labor, hierarchy, formalized rules, impersonality,
and the selection and promotion of employees based on ability, would lead to
more efficient management. Weber also contended that managers' authority in an
organisation should be based not on tradition or charisma but on the position
held by managers in the organisational hierarchy.
b) Neo-classical approach: It can be studied under the following
headings:
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.
In
simple words, a system may be defined as a set a interrelated and
interdependent parts forming an organized unit or entity. These parts are known
as sub-systems which interact with each other and are subject to change. They are
interrelated as well as interdependent. Hence, changes in any sub-system lead
to changes in others. Any working organisation may be said to have three
sub-systems as follows:
1.
Technical Sub-System It represents the formal relationships among
the members of an organisation.
2.
Social Sub-System: It provides social satisfaction to members
through informal group relations.
3.
Power Sub-System: It reflects the exercise of power or
influence by individuals and groups.
Critical
Evaluation of system approach of management
Systems
theory has made the following advantages
1. It provides
a manager a way of thinking about the job he has to managed and finds an
opportunity to him for looking it the organization as a whole and for achieving
overall effectiveness.
2. It provides main
focus to organizational efforts towards a direction which people should move.
3. It draws
attention of managers to an important factor and that is the environment in
which an organization works. The interaction with the environment is dynamic.
4. It includes
within it focus both micro and macro aspects of the organizations. Hence it
serves a multi-level and multi-dimensional approach.
5. It implies
that the modern manager should have analytical orientation should be expert in
motivating to achieve goals and open mandate to receive and respect new ideas,
i.e. creativity and innovation.
6. It also
implies that management education must seek to develop the ability to work with
and motivate others.
7. The feed back
mechanism provides and opportunity to rearrange organizations part according to
the change in the environment.
The
system theories have been criticized on the following grounds.
1. Systems theory is
not a complete explanation of the whole organizational system. It does not
explain how the sub-system of the specific organization is uniquely related in
a given environment.
2. The conceptional
framework for understanding organization provided by system theory is too
abstract.
3. It does not
really offer any new thing. Managers do understand interrelationship between
different parts and the influence of environment on organization and it
sub-systems.
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.
|
Basis |
Features of Contingency
approach |
|
a) Focus |
Emotion and human qualities of workers |
|
b) Structure |
Social system |
|
c) Application |
Democratic process |
|
d) Emphasize |
Personal security and social demand |
|
e) Work Goal of worker |
Attainment of organisation goal |
|
f) Concept about men |
Social being |
|
g) Content |
Human relation movement and organisational behaviour |
|
h) Relation |
Informal |
|
i) Nature |
Organisitic |
2. (a) Discuss briefly
the principles of delegation of authority.
Ans: In every organisation managers
are assigned lot of work and manager alone cannot perform all the work. So, he
divides the work among different individuals working under his according to
their qualification and gets the work done from them. After passing the
responsibilities the manager also shares some of his authority with his
subordinates. To make sure that his subordinates perform all works effectively
and efficiently the manager creates accountability and this whole process is
known as delegation of authority.
Principles of
Delegation of authority:
a)
Knowledge of Objectives: Before delegating authority, the
subordinates should be made to understand their duties and responsibilities. In
addition, knowledge of objectives and policies of the enterprise should be
provided to them.
b)
Parity of Authority and Responsibility: This principle of
delegation suggests that when authority is delegated, it should be commensurate
with the responsibility of the subordinate.
c)
Unity of Command: This principle of delegation suggests that
everyone should have only one boss. A subordinate should get orders and
instructions from one superior and should be made accountable to one superior
only.
d)
The Scalar Principle: The scalar principle of delegation maintains
that there should be clear and direct lines of authority in the Organisation,
running from the top to the bottom. The subordinate should know who delegates
authority to him and to whom he should contact for matters beyond his
authority.
e)
Clarity of Delegation: The principle of clarity of delegation
suggests that while delegating authority to subordinates, they should be made
to understand the limits of authority so that they know the area of their
operation and the extent of freedom of action available to them. Such clarity
guides subordinates while performing their jobs.
(b) Discuss the barriers
to effective delegation. 6+6
Ans: Barriers
in delegation of authority
a)
Reluctance to delegate: In many cases managers will not be
interested to delegate to authority. They will not be willing to give authority
to subordinates. They will not make any plan to delegate authority.
b)
Fear of subordinates: Managers in many cases fear from
subordinates because they think that when there is delegated authority their
performance will be superior to the performance of manager and subordinate may
pose challenge to the manager.
c)
Lack of trust: Managers may lack confident or trust on
subordinates. They do not think or believe that after delegating authority,
subordinates will do better or their performance will improve.
d)
Incompetence of subordinates: Subordinates must be competent
enough for effective delegation of authority. Subordinate must be willing and
competent to accept delegated authority. In many organizations due to the
incompetency of subordinates delegation of authority is affected.
e)
Lack of control: When employees are delegated authority, they will
be free to work. They will work autonomously; managers cannot exercise
effective control over them. Delegation is affected.
3.
Discuss Herzberg's Motivation Hygiene Theory. How is this theory different from
Maslow's Need Hierarchy Theory? 7+5
Ans: Another
popular need-based approach to motivation is the dual-structure approach
developed by Frederick Herzberg. This is also known as Two-factor Theory.
Herzberg developed this approach after interviewing 200 accountants and
engineers in Pittsburg. He asked them to recall such occasions when they had
been dissatisfied and less motivated. He found that entirely different sets of
factors were associated with satisfaction and dissatisfaction. For instance, an
individual who identified 'low pay' as causing dissatisfaction did not
necessarily mention 'high pay' as a cause of satisfaction. Instead, several
other factors, such as recognition or accomplishment, were cited as causing
satisfaction.
This
finding suggests that satisfaction and dissatisfaction are at opposite ends of
a single scale. Employees would, therefore, be satisfied, dissatisfied or
somewhere in between. Herzberg argued that attitudes and motivation consists of
a dual structure. One structure involves a set of factors that result in
feelings ranging from satisfaction to no satisfaction. The other structure involves
a set of factors that result in feelings ranging from dissatisfaction to no
satisfaction.
Herzberg
identified two sets of factors responsible for causing either satisfaction or
dissatisfaction. The factors influencing satisfaction are called motivation
factors or motivators, which are related specifically to the job itself and the
factors causing dissatisfaction, are called hygiene factors, which are related
to the work environment in which the job is performed.
Motivators
a)
Achievement
b)
Recognition
c)
Advancement
d)
The work itself
e)
The possibility of personal growth
f)
Responsibility
Hygiene or Maintenance Factors
a)
Company policies
b)
Technical supervision
c)
Interpersonal relations with supervisor
d)
Interpersonal relations with peers
e)
Interpersonal relations with subordinates
f)
Salary
g)
Job security
h)
Personal life
i)
Work conditions
j)
Status
Based
on these findings, Herzberg recommended that managers seeking to motivate
employees should first make sure that hygiene factors are taken care of and
that employees are not dissatisfied with pay, security and working conditions.
Once a manager has eliminated employee dissatisfaction, Hertzberg recommends
focusing on a different set of factors to increase motivation, by improving
opportunities for advancement, recognition, advancement and growth.
Specifically, he recommends job enrichment as a means of enhancing the
availability of motivation factors.
Criticism
Although widely accepted by
managers, Hertzberg’s dual structure approach however suffers from certain
drawbacks. Other researchers who measured satisfaction and dissatisfaction
based on different aspects reached very different conclusions. They have also
criticized Herzberg's theory for its inability to define the relationship
between satisfaction and motivation and to pay enough attention to differences
between individuals. Hence, at present Herzberg's theory is not held in high
esteem by researchers in the field of motivation. The theory, however, had a
major impact on managers and has played a key role in increasing their
awareness of motivation and its importance in type work place.
Difference between Maslow’s Need Hierarchy
theory and Herzberg’s motivation Hygiene Theory
1. Meaning:
Maslow's theory is based on the concept of human needs and
their satisfaction.
Hertzberg's
theory is based on the use of motivators which
include achievement, recognition and opportunity for growth.
2.
Basis of Theory:
Maslow's
theory is based on the hierarchy of human needs. He identified five sets of
human needs (on priority basis) and their satisfaction in motivating employees.
Hertzberg
refers to hygiene factors and motivating factors in his theory. Hygiene factors
are dissatisfies while motivating factors motivate subordinates. Hierarchical
arrangement of needs is not given.
3.
Nature of Theory:
Maslow's
theory is rather simple and descriptive. The theory is based long experience
about human needs.
Hertzberg's
theory is more prescriptive. It suggests the motivating factors which can be
used effectively. This theory is based on actual information collected by
Hertzberg by interviewing 200 engineers and accountants.
4.
Applicability of Theory:
Maslow's
theory is most popular and widely cited theory of motivation and has wide
applicability. It is mostly applicable to poor and developing countries where
money is still a big motivating factor.
Herzberg's
theory is an extension of Maslow's theory of motivation. Its applicability is
narrow. It is applicable to rich and developed countries where money is less
important motivating factor.
5.
Descriptive or Prescriptive
Maslow's
theory or model is descriptive in nature.
Herzberg's
theory or model is prescriptive in nature.
6.
Motivators
According
to Maslow's model, any need can act as motivator provided it is not satisfied
or relatively less satisfied.
In
the dual factor model of Hertzberg, hygiene factors (lower level needs) do not
act as motivators. Only the higher order needs (achievement, recognition,
challenging work) act as motivators.
4.
Why is communication so important for any business organisation? What are the
barriers to effective communication? 6+6
Ans:
Significance (Need) of Business communication
Communication
is the life blood of business. It is an all pervasive function of management.
Today the organizational structure is designed on the basis of specialization
and division of labour. Large number of people work together who are
functionally related to each other. Thus, co ordination is must amongst the
workmen. Co-ordination can be achieved only when there is mutual trust and understanding
between them. This understanding is created by effective communication. Thus
communication is an essential ingredient for effective management. Further the
role of communication may be summed up as:-
1.
The objectives, plans and policies
of the organization are cleared to the workers through communication.
2.
It provides unity of direction to
various activities of the enterprise.
3.
It helps in controlling and
coordinating the various activities of the organization.
4.
It helps in motivating the workers
of an organization.
5.
It helps the managers to develop
their managerial skill.
According
to Sir John
Harvey-Jones, “Communication is the single most essential skill.
Effective communication is the need of
the day.” In recent times communication
has become all more essential due to the following reasons:-
1.
Growth in the
size of the business organization: An efficient system of communication is required because the
business organizations are growing tremendously. Thousands of people work in
the organization. Organizations have factories or offices in different parts of
the country or even world.
2.
Advance
technology: Day by day rapid changes are taking place in science and
technology leading to obsolescence of old technology. Thus in order to upgrade
or modernize technology proper communication between the superior and
subordinate in an organization is a must.
3.
Tough competition
in the market: Globalization and liberalization have resulted in cut throat
competition. Thus to survive such competition, persuasive communication in form
of advertisement, publicity, personal contacts are essential.
4.
Growing
specialization: Division of work paved way for specialists to work in different
department’s sound communication is thus essential for ensuring mutual
cooperation and understanding between different departments.
5.
Trade union
movement: trade union movement is on its growth. Management now has to
consult trade unions on various matters. A strong and meaningful relation
between management and trade union is possible only by effective communication.
6.
Human
relation: Employee’s participation in management helps to develop among them
a sense of loyalty and belongingness towards the organization. Thus effective
communication between management and employee is necessary to develop mutual
trust and confidence.
7.
Public
relations: Public relations help an organization to improve its image in
society as the organization has a social responsibility especially towards the
customers.
Barriers of Communication:
Communication
is the process of passing information and understanding from one person to
another, anything that obstructs the free flow of communication is referred to
us Barrier of communication. E.g. Problem in encoding and decoding, wrong or
defective communication channel, noise in the channel etc. Barrier may arise at
any of the following level:
a)
Sender oriented,
b)
Receiver oriented
Sender-oriented barriers could be voluntary or
involuntary. At any cost, efforts should be made on the part of the sender to
identify and remove them. As the sender
is the originator of communication, he should be extremely careful not
to erect barriers. If his interaction gives rise to or indicates that there are
barriers, the communication comes to a grinding halt. Some of the barriers that
are sender-oriented are as follows:
Receiver can also have some barriers in the
course of the interaction. Although his role in the initial phase is passive,
he becomes active when he starts assimilating and absorbing the information. He
is equally to blame if the situation goes awry and communication comes to a
stop, or there is miscommunication. Some of the barriers emanating from the
side of the receiver are as follows:
Types of Barriers in communication: The barriers to communication in an
organization may be broadly categorized into following groups:
1.
Physical barriers (RECEIVER’S ORIENTED)
2.
Socio- psychological or personal barriers (RECEIVER’S ORIENTED)
3.
Organizational barriers (SENDER’S ORIENTED)
4.
Semantic barriers (SENDER’S ORIENTED)
5.
Mechanical barriers (SENDER’S ORIENTED)
However,
such a classification does not suggest that these are mutually exclusive.
Rather, it is helpful in understanding the nature of communication barriers.
1.
Physical Barriers: There are the
environmental factors that also obstruct or reduces the sending and receiving
of communication, such as physical distance distracting noises and other
interferences difficulty arises in communicating a message, when the physical
distance increases:-
Noise:
Noise is first and foremost barrier to effective communication. Noise may be
caused by machines, equipment, communication device, disturbances in the time
of transmission etc. noise also encompasses many other factors such as the
sender may use ambiguous or confusing signal. The receiver may misinterpret the
message. Thus communication is likely to be spoilt due to noise.
Time
and distance: Time and distance also acts as a barrier in smooth flow of
communication. Distance between the sender and receiver acts as a hurdle.
Although this barrier can be overcome by technology but still in case of
breakdown, this exists. Different timing of shifts at workplace also act as
barriers in imparting on vital information.
2. Socio-psychological or personal Barriers:
There are certain socio psychological factors which restrict the free flow of
communication. They are the attitude and opinions, status consciousness, ones
relations with fellow workers, seniors, and junior’s etc. family background.
These restrict participative communication:
I.
Motives, attitudes, judgments, emotions, and social values of people from the
part of the personal barriers. Psychological distance is also developed with
this.
II.
Individual Differences: There are differences in the motives, attitudes and
sentiments of the people. So this causes problems in encoding and decoding
other’s sentiments, attitudes and motives.
III.
Differences in interest: The interest of people also differs. A problem may be
important for one person but may not carry weight for another. The ideas,
question, attitudes, feelings etc of other party may represent an obstacle to
one’s own personal goal.
IV.
Division of People: Communication is ideas and viewpoint also gets affected by
the division of people into classes, castes and communities.
V.
Difference of viewpoints: Communication suffers when there are differences in
view point of the different people.
VI.
Lack of planning: Good communication never happens but has to be planned. When
people take it lightly and communicate without planning it turns into
miscommunication or mal communication.
VII.
Cultural barriers: Due to difference in the cultural background the same word,
phrases, symbols, actions etc. may mean different to different group of people.
Mis understanding may take place due to this.
3. Organizational Barriers:
Organisational barriers arise due to defects in the organization structure and
the communication system of an organization:
I.
Hierarchical distance: Downward communication promotes hierarchical distance.
The chances of information being filtered are more at this structure, because
there are several layers. Information received from the top may not reach at
bottom in the same shape. The information gets coloured which brings
hierarchical distance.
II.
Diversion: Diversion of information is also one of the causes which brings
barrier to communication process. For example sometimes a manager diverts the
information meant for one person or group to another.
III.
Colouring: Information are also coloured by the manager intentionally with a
view to twist the situation in their favour. For example, an office may quote
his subordinate wrongly, to spoil his career or his chance of promotion or his
image in the eyes of the boss.
IV.
Status barriers: Status is a barrier of communication in a formal organization.
Organizational interaction and communication are influenced by the status and the
expectations.
V.
Goal conflicts: Goal conflict acts as communication reducers. Different goal
lead to bifurcation of interest. Due to this communication suffers.
4.
Semantic Barriers: Semantic means
the relationships of signs of their reference. Semantic barrier arises from the
disadvantages of the symbolic system. Symbols have got number of meaning and
one has to choose any one of them according to the requirement of
communication. Symbol or the language is the most important tool of
communication which has to be used very carefully:-
I.
Words with different meaning: Some words convey more than one meaning. When the
receiver assigns a different meaning to a word than what the sender intended,
there occurs miscommunication.
II.
Denotation and connotation: Words have two types of meaning = Denotation and
connotation. Denotation is the literal meaning of the words connotation are the
suggestive meaning of the words. Connotation is the suggestive meanings of the
words. Connotation may be positive or negative.
III.
Offensive style of communication: Badly expressed messages lose their impact.
Offensive style of communication leads to communication breakdown causing loss
of time and money.
IV.
Wrong assumptions: Communication should not be based on assumption as it may
lead to wrong interpretation. All possible efforts should be made to clarify
assumptions.
V.
Selective perception: many a time the message is decoded by the receiver in a
way which may be selective. In other words most of the receivers protect their
own interest and expectations leading to a particular type of feedback which
becomes a communication problem.
5.
Mechanical Barriers: Mechanical
barriers include inadequate arrangement for transmission of news, facts and
figures. Example poor office layout and defective procedure and the use of
wrong media led to poor communication.
I.
Information overload: Excess of communication is called information overload.
Brevity is the soul of communication. The receiver cannot comprehend and absorb
beyond his mental capacity. His mind will remain closed for the excess part of
the communication. Therefore one should be brief and to the point.
II.
Loss of transmission: When messages are transmitted from person to person they
are filtered. In other words they are diluted and distorted on the way. In oral
communication about 30% of the information is lost in each transmission.
5. What do you mean by
coordination? What is the need for coordination in today's business
environment? 6+6
Ans: Concept of
Coordination
Coordination is an orderly arrangement of group
efforts to provide unity of action in pursuit of common purpose. The key
features of coordination are as follows:
a)
Coordination is not a distinct function but the very essence of
management.
b)
It is the result of conscious and concerted action by management.
c)
Coordination is a continuous, never ending or on-going process. It is
also a dynamic process.
d)
Coordination is required in group efforts not in individual effort.
e)
Coordination has a common purpose of getting organizational objectives
accomplished.
Importance
of co- ordination (Essence of Management):
Co-ordination is an integral element or ingredient
of all the managerial functions as discussed below: -
a)
Coordination through Planning: Planning facilitates co-ordination by
integrating the various plans through mutual discussion, exchange of ideas.
e.g. - co-ordination between finance budget and purchases budget.
b)
Co-ordination through Organizing - Mooney considers co-ordination
as the very essence of organizing. In fact when a manager groups and assigns
various activities to subordinates, and when he creates department’s
co-ordination uppermost in his mind.
c)
Co-ordination through Staffing - A manager should bear in mind
that the right no. of personnel in various positions with right type of
education and skills are taken which will ensure right men on the right job.
d)
Co-ordination through Directing - The purpose of giving orders,
instructions & guidance to the subordinates is served only when there is a
harmony between superiors & subordinates.
e)
Co-ordination through Controlling - Manager ensures that there
should be co-ordination between actual performance & standard performance
to achieve organizational goals.
Now
we can conclude that all the functions of management are affected by
coordination. Hence coordination is essential for achieving the objectives of
the organisation. It is also required for the survival, growth and
profitability of the organisation. Coordination encourages team spirit, gives
right direction, motivates employees, and makes proper utilisation of
resources. Therefore, Coordination is rightly called the "Essence of
Management".
6. Explain briefly Programme Evaluation and Review
Technique (PERT). How is it different from CPM? Discuss. 12
Ans: PERT: Programme Evaluation and Review
Technique is based on network analysis which uses estimates of time required to
complete tasks for scheduling and controlling execution of projects. PERT is
basically used for projects which are one time and may not be repeated. It
helps in planning and controlling of time required to complete the task.
PERT was first developed as a Management Aid
for completing Polaris Ballistic Missile Project in USA in October 1958. It
worked well in expediting the completion of the project from 7 years to 5
years. Since then, PERT has become very popular technique used for project
planning and control. In nutshell, it schedules the sequence of activities to be
completed in order to accomplish the project within a short period of time. It
helps reduce both the time and cost of the project. .
CPM: Critical Path Method
is a statistical technique of project management in which planning, scheduling,
coordination and control of well defined activities takes place. CPM is
basically used for projects which are of repetitive nature. It helps in
controlling cost and time involved in the project. CPM was first developed as
an algorithm used in planning, scheduling, coordination and control of
activities of a project.
Difference between PERT and CPM
|
Basis |
PERT |
CPM |
|
1. Activities |
PERT is a technique used in planning,
scheduling, coordination and control of uncertain events. |
CPM is a technique used in planning,
scheduling, coordination and control of well defined activities. |
|
2. Nature |
PERT is used for projects which are of
non-repetitive nature. |
CPM is used for projects which are of
repetitive nature. |
|
3. Focus on |
PERT main focus on controlling of
time. |
CPM helps in controlling cost and time
involved in the project |
|
4. Model used |
Probabilistic model used in PERT. |
Deterministic model used in CPM. |
|
5. Projects |
PERT is used for research based
projects. |
CPM is used for mainly construction
projects. |
|
6. Orientation |
PERT is event oriented. |
CPM is activity oriented. |
SECTION
B
7. Write explanatory
notes on any two of the following: 7+7
(a) Henry Fayol's
Administrative Theory
Ans: Contribution of Henry Fayol
Henry Fayol (1841-1925): was a Frenchman with considerable executive
experience who focused his research on the things that managers do. He wrote
during the same period Taylor did. Taylor was a scientist and he was managing
director of a large French coal-mining firm. He was the first to envisage a
functional process approach to the practice of management. His was a functional
approach because it defined the functions that must be performed by managers.
It was also a process approach because he conceptualized the managerial job in
a series of stages such as planning, organizing and controlling. According to
Fayol, all managerial tasks could be classified into one of the following six
groups:
• Technical (related to production);
• Commercial (buying, selling and exchange);
• Financial (search for capital and its optimum
use);
• Security (protection for property and person);
• Accounting (recording and taking stock of
costs, profits, and liabilities, keeping balance sheets, and compiling
statistics);
• Managerial (planning, organizing, commanding,
coordinating and control);
He pointed out that these activities exist in
every organization. He focused his work on the administrative or managerial
activities and developed the following definition:
• Planning meant developing a course of action
that would help the organization achieve its objectives.
• Organizing meant mobilizing the employees and
other resources of the organization in accordance with the plan.
• Commanding meant directing the employees and
getting the job done.
• Coordinating meant achieving harmony among the
various activities.
• Controlling meant monitoring performance to
ensure that the plan is properly followed.
(b) Principles of Planning
Ans: A
number of fundamental principles have been devised over the year for guiding
managers undertaking planning. Some of these principles are discussed as under,
a)
Principle
of contribution to objective: All types of plans are prepared
to achieve the objectives of the organisation. Both major and derivative plans
are prepared to contribute to the objectives of the enterprise. Planning is
used as a means to reach the goals.
b)
Principles
of primacy of Planning: This principle states that
planning is the first or primary function of every manager; He has to plan
first and then proceed to carry out other functions. Other managerial functions
are organized to reach the objectives se in planning.
c)
Principle
of Planning Premises: In order to make planning effective, some premises or
presumptions have to be made on the basis of which planning has to be
undertaken. Plans are, generally not properly structures. The reason being that
planning premises are not properly developed. This principle lays emphasis on
properly analyzing the situation which is going to occur in future.
d)
Principle
of Alternatives: Planning process involves developing of many alternatives and
then selecting one which will help in achieving desired business goals. In the
absence of various alternatives proper planning will be difficult.
e)
Principle
of Timing: Plans can contribute effectively to the attainment of business
goals if they are property timed. Planning premises and policies are useless
without proper timing.
f)
Principle
of Flexibility: This principle suggests flexibility in plans if some
contingencies arise. The plans should be adjusted to incorporate new
situations. The dangers of flexibility should be kept in mind. The changes may
upset the earlier commitments. So the cost of changes should be compared to the
benefits of flexibility.
g)
Principle
of Commitment: There should be a time frame for meeting the commitments made. This will ensure the achieving
of targets in time.
h)
Principle
of Competitive Strategies: While formulating own. Plans a
manager should keep in mind the plans of competitors. The plans should be
framed by thinking of what the. Competitors will do in similar situations.
(c) Factors Affecting
Span of Control
Ans: Factors influencing the span of
Management
There are number of factors that
influence or determine the span of Management in a particular organisation, the
most important of these are as follows:
1.
The
capacity and ability of the executive: The
characteristics and abilities such as leadership, administrative capabilities;
ability to communicate, to judge, to listen, to guide and inspire, physical
vigour, etc. differ from person to person. A person having better abilities can
manage effectively a large number of subordinates as compared to the one who
has lesser capabilities.
2.
Competence
and training of subordinates: Subordinates who
are skilled, efficient, knowledgeable, trained and competent require less
supervision, and therefore, the supervisor may have a wider span in such cases
as compared to inexperienced and untrained subordinates who requires greater
supervision.
3.
Nature
of Work: Nature and importance of work to be
supervised is another factor that influences the span of supervision. The work
involving routine, repetitive, unskilled and standardized operations will not
call much attention and time on the part of the supervisor.
4.
Time
available for supervision: The capacity of a person to supervise
and control a large number of persons is also limited on account of time
available at his disposal to supervise them. The span of control would be
generally narrow at the higher level of management because top manager have to
spend their major time on planning, organising, directing and controlling and
the time available at their disposal for supervision will be less.
5.
Degree
of Decentralization and Extent of Delegation: If a
manager clearly delegates authority to undertake a well-defined task, a well
trained subordinate can do it with a minimum of supervisor's time and
attention.
6.
Effectiveness
of communication system: Faulty communication puts a heavy
burden on manager's time and reduces the span of control.
7.
Quality
of Planning: Effective planning helps to reduce frequent
calls on the superior for explanation, instructions and guidance and thereby
saves in time available at the disposal of the superior enabling him to have a
wider span.
8.
Degree
of Physical Dispersion: If all persons to be supervised are
located at the same place and within the direct supervision of the manager, he
can supervise relatively more people as compared to the one who has to
supervise people located at different places.
9.
Assistance
of Experts: the span of supervision may be wide where the
services of experts are available to the subordinate on various aspects of
work. In case such services are not provided in the organisation, the
supervisor has to spend a lot of time in providing assistance to the workers
himself and a such the span of control would be narrow.
(d) Principles of
Directing
Ans: Principles of Directing are given below:
a)
Maximum Individual contribution:
According to this principle, directing must help every individual employee to
contribute his Best towards the achievement of organizational goal.
b)
Harmony of objectives: Directing
must ensure that the individual goals of employees and that of organization do
not conflict with each other. Directing must aim at bringing harmony among
them.
c)
Unity of direction: There should
be one head and one plan for a group of activities having the same objective to
have effective direction.
d)
Unity of Command: According to
this principle an employee should receive orders from one boss only to avoid
confusion. If there are more bosses it can create problem amongst superiors.
e)
Effective leadership: A manager
must possess the qualities of a good leader. He must guide his subordinates not
only on work problems but also on their personal problems.
f)
Effective communication: To have effective direction, it is very
essential to have an effective communication system which provides for free
flow of ideas, information, suggestions, complaints and grievances.
g)
Follow through: Managers must
continuously review whether the instructions are being understood and followed
by the employees or not.
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