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Feb/Spring 2013

Bachelor of Business Administration-BBA Semester 6

BB0031 Management Development- 4 Credits

(Book ID: B0184)

Assignment Set- 1 (30 Marks)

______________________________________________________________________________

Note: Each question carries 10 Marks. Answer all the questions.

Q.1 What are the different types of decisions? Explain with examples.

Ans: The decision-making systems can be classified in a number of ways. There are two types of

systems based on the managers knowledge about the environment. If the manager operates in aknown environment then it is a closed decision-making system. The outcome of the decision is

also not known fully. The knowledge of the outcome may be a probabilistic one.

It is difficult to decide an objective or a goal and, therefore, the manager resorts to that decision,

where his aspirations or desires are met best.

Deciding on the possible product diversification lines, the pricing of a new product, and the plantlocation, are some decision-making situations which fall in the category of the open decision-making systems. The MIS tries to convert every open system to a closed decision-making system

by providing information support for the best decision. The MIS gives the information support,

whereby the manager knows more and more about environment and the outcomes, he is able togenerate the decision alternatives, test them and select one of them. A good MIS achieves this.

Types of Decisions

The types of decisions are based on the degree of knowledge about the outcomes or the events yet

to take place. If the manager has full and precise knowledge of the event or outcome which is to

occur, then the decision-making is not a problem. If the manager has full knowledge, then it is asituation of certainty. If he has partial knowledge or a probabilistic knowledge, then it is decision-

making under risk. If the manager does not have any knowledge whatsoever, then it is decision-

making under uncertainty.

A good MIS tries to convert a decision-making situation under uncertainty to the situation under

risk and further to certainty. Decision-making in the Operations Management is a situation of cer-tainty. This is mainly because the manager in this field has fairly good knowledge about the events

which are to take place, has full knowledge of environment, and has pre-determined decision

alternatives for choice or for selection.

Decision-making at the middle management level is of the risk type. This is because of thedifficulty in forecasting an event with hundred per cent accuracy and the limited scope of

generating the decision alternatives.

At the top management level, it is a situation of total uncertainty on account of insufficient

knowledge of the external environment and the difficulty in forecasting business growth on along-term basis.

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Q.2 Discuss line organizations in detail.

Ans: Line organization is the oldest and simplest method of administrative organization.

According to this type of organization, the authority flows from top to bottom in a concern. The

line of command is carried out from top to bottom. This is the reason for calling this organization

as scalar organization which means scalar chain of command is a part and parcel of this type ofadministrative organization. In this type of organization, the line of command flows on an even

basis without any gaps in communication and co- ordination taking place.

Features of Line Organization

1. It is the simplest form of organization.

2. Line of authority flows from top to bottom.

3. Specialized and supportive services do not take place in this organization.

4. Unified control by the line officers can be maintained since they can independently takedecisions in their areas and spheres.

5. This kind of organization always helps in bringing efficiency in communication and bringingstability to a concern.

Merits of Line Organization

1. Simplest- It is the most simple and oldest method of administration.

2. Unity of Command- In these organizations, superior-subordinate relationship is maintained and

scalar chain of command flows from top to bottom.

3. Better discipline- The control is unified and concentrates on one person and therefore, he canindependently make decisions of his own. Unified control ensures better discipline.

4. Fixed responsibility- In this type of organization, every line executive has got fixed authority,

power and fixed responsibility attached to every authority.5. Flexibility- There is a co-ordination between the top most authority and bottom line authority.

Since the authority relationships are clear, line officials are independent and can flexibly take the

decision. This flexibility gives satisfaction of line executives.

Demerits of Line Organization

1. Over reliance- The line executives decisions are implemented to the bottom. This results inover-relying on the line officials.

2. Lack of specialization- A line organization flows in a scalar chain from top to bottom and there

is no scope for specialized functions. For example, expert advices whatever decisions are taken by

line managers are implemented in the same way.

3. Inadequate communication- The policies and strategies which are framed by the top authorityare carried out in the same way. This leaves no scope for communication from the other end. The

complaints and suggestions of lower authority are not communicated back to the top authority. Sothere is one way communication.

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Q.3 Mr Shukla is the HR Manager at Sharp Technologies. The organization is planning to

expand its operations in different cities. There are some financial constraints, so the

recruitments are to be made from within the organization.

Suggest some ways to Mr Shukla to fill in the positions in different categories.

Ans: There are following I will suggest to Mr Shukla to fill in the positions in different categories

1. Internal recruitment is when the business looks to fill the vacancy from within its existingworkforce.

2. External recruitment is when the business looks to fill the vacancy from any suitableapplicant outside the business.

3. Job centres - These are paid for by the government and are responsible for helping the

unemployed find jobs or get training. They also provide a service for businesses needing toadvertise a vacancy and are generally free to use.

4. Job advertisements - Advertisements are the most common form of external recruitment.They can be found in many places (local and national newspapers, notice boards,

recruitment fairs) and should include some important information relating to the job (job

title, pay package, location, job description, how to apply-either by CV or applicationform). Where a business chooses to advertise will depend on the cost of advertising and the

coverage needed (i.e. how far away people will consider applying for the job

5. Recruitment agency - Provides employers with details of suitable candidates for a vacancyand can sometimes be referred to as head-hunters. They work for a fee and often

specialise in particular employment areas e.g. nursing, financial services, teacher

recruitment

6. Personal recommendation - Often referred to as word of mouth and can be a

recommendation from a colleague at work. A full assessment of the candidate is stillneeded however but potentially it saves on advertising cost.

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