Detailed Solutions INDUSTRIAL MANAGEMENT A-16/C-17/T-20 December 2004

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Q.1 (a) B - The principle of management that emphasizes the need for teamwork among employees is known as Espirit de Corps.

(b) A - Top management level includes Board of Directors, Managing Directors, Chief Executive and General Manager.

(c) A - A combination of short statements that describe both the work to be performed and the essential requirements of the particular job is known as Job Evaluation.

(d) B - The Industrial Disputes Act aims at settling disputes between Employees and Employer.

(e) A - The sum of Direct Material Cost, Direct Labour Cost and Direct Expenses is Prime Cost.

(f) D - Method study and Work Measurement are components of Work Study.

(g) C - Decisions made in accordance with some habit, rule or procedure are called Programmed Decisions.

(h) B - Samples, money-refund offers, contests and competition for consumers are Consumer Promotion Tools.

PART I

Q2(a) Causes of Organisational Change: Causes of Organisational changes are as follows :-

(A) External pressures

(i) Change in Technology and Equipments - Advancements in technology is the major cause (ie. External pressure) of change. Each technological alternative results in new forms of organization to meet and match the needs.

(ii) Market situation - Changes in market situation include rapidly changing goals, needs and desires of consumers, suppliers, unions etc.

(iii) Social and political changes - Organisational units literally have no control over social and political changes in the country. Relations between government and business or drive for social equality are some factors which may compel for organizational change.

(B) Internal pressure

(i) Changes in the Managerial Personnel - One of the most frequent reasons for major changes in the organization is the change of executive at the top. No two managers have the same style, skills or managerial philosophies.

(ii) Deficiencies in the existing organisation - Many deficiencies are noticed in the organizations with the passage of time. A change is necessary to remove such deficiencies as lack of uniformity in the policies, obstacles in communication, any ambiguity etc.

(iii) Certain other factors such as listed below also demand a change in the organization -

Employee’s desire to share in decision- making.

Employee’s desire for higher wage rate

Improvement in working conditions, etc.

Q2(b) Delegation of authority : Delegation may be defined as the entrustment of responsibility and authority to another and the creation of accountability for performance. The Principles of Delegation are as below:-

(i) Parity between authority and responsibility - There should be complete parity between authority and responsibility. If authority is more than responsibility, people will make misuse of their authority and if responsibility is more than authority, the results can never be achieved.

(ii) Responsibility in terms of results - To be effective, delegation of authority should always be in terms of exact results of responsibility. In other words, responsibility should be specific on a specific person, because everybody’s responsibility is nobody’s responsibility.

(iii) Principle of Unity of Command - Orders, instructions and

guidelines should flow to a subordinate from a single particular executive only in order to avoid confusion, conflicts and duplication of work.

(iv) Delegation of responsibility - Authority can be delegated. But, responsibility and accountability cannot be delegated. By delegating authority, an executive does not escape from responsibility, He is, in addition, responsible for the act of his subordinates also.

(v) Overlapping of responsibilities - While delegating authority, it must be ensured that duties and responsibilities of subordinates do not overlap.

(vi) Free flow of information - In delegation of authority, there should be free two way communication ( as regards exchange of ideas, instructions, guidelines, clarifications, suggestions etc.) between an executive and a sub-ordinate.

(vii) Delegated authority - Authority delegated to the subordinate should be adequate, enough and as per the status and position of the subordinate, in order to achieve optimum results.

Q3(a) Labour Turnover: Labour turnover refers to the movement of workers into and out of an organisation. Labour turnover may be defined as the time-to time changes in the number of the work force that result from the hiring, release and replacement of employees.

Causes of Labour Turnover

(a) Voluntary withdrawals (by the worker) due to :-

- dislike for the present job;

- better job available elsewhere;

- conditions at home;

- ill-health;

- poor working conditions;

- bad treatment from the boss;

- lower wages and excessive hours of work;

- job being hard and hazardous;

- poor training and induction;

- dirty politics prevalent in the industry;

- partially in making promotions and transfers and due to,

- ineffective and inefficient management.

(b) Lay-offs due to seasonal nature of industry, shortage of power, fuel, raw material, etc.

(c) Discharges due to undesirable activities of the employees, insubordination or they being found unsuitable for the job.

(d) Retirement.

(e) Death.

Q3(b) Collective Bargaining: Collective Bargaining constitutes the negotiations between the management and the union with the ultimate objective of agreeing on a written contract covering the terms and conditions of settlement of the disputed issues. Collective bargaining is basically a give-and-take process involving proposals and counter proposals.

The steps involved in collective bargaining process are:-

(i) Putting up before the management, by the employees, their demands and grievances collectively.

(ii) Discussing and negotiating with the management representative, with a view to settle the disputed issues.

(iii) Singing a formal or informal agreement mutually arrived at.

- The mutual agreement may be as regards the following:

(a) Union security.

(b) Wages, bonus and other benefits.

(c) Terms and conditions of employment, Hours of work, Holidays, Safety and health, Promotion, transfer and discharge, etc.

(d) Grievance procedure.

(e) Incentives.

(f) Management responsibilities, etc.

- If either of the party, later on, feels reluctant in abiding by its commitments under the mutual agreement, the other party can employ economic pressures to force that party to meet its obligations.

(iv) In the event of no agreement, various pressures are brought to bear upon the management by the union (such as strikes, picketing, gheraos, etc.) or on union by the management (such as lock-out) to reconcile.

In collective Bargaining both the parties, i.e., management representatives and union officials have a basic obligation to establish a constructive relationship of working harmony in the settlement of disputes and in the advancement of labour-management peace.

Q4(a) Production and Manufacturing Budget:A production budget may be prepared by production manager in consultation with his assistants after receiving the sales Budget. A production budget shows the quantity of products to be manufactured. It is based upon :

(i) Sales budget,

(ii) Factory capacity (Production and storage),

(iii) Budgeted stock requirements,

(iv) Economic lot size, and

(v) Availability of raw material and labour, etc.

A production budget finds the cost of producing the estimated volume of saleble products. A production plan is calculated in terms of the number of units to be produced in each period, say a month. As far as possible, the production should be planned at a relatively even rate, even though the sales budget indicates a high seasonal sales forecast.

Manufacturing budget needs the following basic budgets or estimates to meet the plans:-

(i) Production budget outlining the schedule of product units to be

manufactured.

(ii) Direct material budget.

(iii) Plant (space) and equipment budget.

(iv) Maintenance budget.

(v) Manufacturing expense budget (overhead).

(vi) Labour budget.

Production budget is a part of Manufacturing budget. Manufacturing helps management in keeping production at an even level and in controlling the use of labour, material, equipment, etc.,

Q4(b) Work Study: Definition of Work Study: Work Study, as defined by British Standard Institution, is a generic term for those techniques particularly ‘Method Study’ and ‘Work Measurement’ which are used in the examination of human work in all its contexts and which lead systematically to the investigation of all the factors which effect the efficiency of the situation being reviewed, in order to seek improvements.

Advantages of work study

The following are the advantages :-

(i) Uniform and improved production flow,

(ii) Higher productive efficiency,

(iii) Reduced manufacturing costs,

(iv) Fast and accurate delivery dates,

(v) Better employee – employer relations,

(vi) Better service to customers,

(vii) Job security and job satisfaction to workers,

(viii) Better working and other conditions, and

(ix) Higher wages to workers.

Q5(a) Morale: Morale is a measure of extent (or level as either high or low) of voluntary cooperation demonstrated by a individual or a work group and of the intensity of the desire to attain common goals. Morale is a mental condition or attitude of (individuals and) groups which determines their willingness to cooperate. Morale is made up of two sets of elements – one set containing those which help to make a person satisfied with his job and a second set containing those (elements) which when, lacking, make him feel dissatisfied.

The word morale generally has an implication of group reactions ie., what motivation does to the individual, morale does to the work group. Morale is an individual attitude in a group endeavour and a group attitude towards the goals of an organization. High morale is the confident spirit of whole-hearted cooperation in a common effort.

Factors Affecting Morale

Factors which tend to lower or improve the employee morale are :

1. Job Factors -

Nature of job,

Fatigue and boredom associated with the job,

Employees interest in the job,

Job satisfaction,

Confidence on individual members of the group,

Confidence of different members of the group in the leadership at all levels.

Nature of leadership and supervision, i.e., whether the leader/supervisor is just, impartial, helpful, social minded etc.

Working and environmental conditions, i.e., whether they are good and wholesome.

Condition or working equipment.

2. Personal Factors, such as Background, Intelligence, Age, Skill and proficiency, Sex, Training, Mental and emotional condition of employee, Experience, etc.

3. Other factors such as,

- Organisational efficiency, ie.,

(i) The way the organization is set up, the way the orders are given, the way information is passed up and down, the way things are provided, etc,

(ii) The way the informal organizations decide and think and work.

- Objects of the organization, i.e., whether they are clear or they confuse the employees.

- Unfair selections and promotions.

- Frustrations resulting from lack of recognition, ie., attaching more importance to junior persons and neglecting seniors.

- Rewards and Incentives.

Q5(b) Functions of Marketing Management: The broad functions of marketing management consist of the following :

(i) Marketing Research:-

Marketing research includes all research activities involved in marketing problems:-

(i) gathering, recording and analyzing the utility and marketability of the product;

(ii) the nature of demand;

(iii) the nature of competition;

(iv) the methods of marketing; and

(v) other aspects of movement of products from the stage of production to the point where they get consumed.

(ii) Sales Forecasting

Forecasting is essentially the art of anticipating what buyers are likely to do under a given set of condition. Sales forecast is a commitment on the part of the sales department and each of its divisions of the expected sales likely to be achieved in a given period at stated prices.

(iii) Advertising

It is a commercial message to the public, designed to inform potential and established consumers and to encourage sales for the advertiser. Advertising is just as communication is vital to good internal management, so is vital to the earning of profit.

(iv) Sales promotion

Sales promotion are intended to educate the consumers better and to bring about an increase in sales and is used more extensively in highly competitive business.

(v) Packaging

Packaging is an important activity of a sales promotion department because an attractive package catches fast the attention of the customers and speaks itself to them.

(vi) Pricing

The price of the products is the means whereby manufacturers obtain a fair return for their labour and replace/increase their wealth and purchasing power in return for supplying the products. All business enterprises face the task of setting a price for their products or services.

(vii) Handling or inquiries and orders from customers.

(vii) Servicing. The continued servicing after sales.

Q6(i) Matrix Organisation: Matrix organization is used when an organization has to handle a variety of projects, ranging from small to large. When a pure project structure is superimposed on a functional structure, the result is a matrix structure. The project structure provides a horizontal lateral dimension to the traditional vertical orientation of the functional organization structure as given in the following diagram.

Personnel

Matrix organization is created by merging (two complementary structures, namely) pure project organization and functional organization. The project teams are composed of persons drawn from the functional departments for the duration of the project. When their assignment is over, they return to their respective departments. During continuation of the project, such persons have two bosses – one, from the functional department and second of the concerned project.

Advantages of matrix organization

(i) If effectively focuses resources on a single project, permitting

better planning and control to meet deadline.

(ii) It is more flexible than a traditional functional hierarchy.

(iii) Services of specialists are better utilized as more emphasis is placed on the authority of knowledge than rank of the individuals in the organizational hierarchy.

Limitations of matrix organization

(i) Matrix organization violates the principle of unity of command as a person works under two bosses e.g., project manager and functional boss. This may give rise to conflicts in the organisation.

(ii) Organisation relationships are more complex and they create problems of coordination.

(iii) Since persons are drawn temporarily from different departments, project manager does not have line authority over them.

(iv) Project group is heterogeneous due to which morale of the personnel may be low.

Q6(ii) Grievances Handling: Individual employees generally have some complaints called grievances against the working rules of the business enterprise, e.g wages, bonus, working conditions, behaviour of supervisor etc.

A Grievance may be defined as any feeling of discontent or dissatisfaction, whether expressed or not and whether valid or not, arising out of anything connected with the company that an employee thinks, believes or even feels is unfair, unjust or inequitable. A grievance may be :

(i) unvoiced or stated by the worker,

(ii) written or unwritten, and

a. valid or ridiculous, and may arise out of something connected with the company, e.g company policy or actions. If the enterprise wants to get maximum out of its employees, an adequate and effective procedure must be deployed by the management to handle and settle grievances of its employees.

The one thing which is very harmful to good relations between workers and management is the feeling among workers that the management does not look into their problems and difficulties. This results in dissatisfaction in the minds of workers and distrust towards management which, in turn, introduces inefficiency and lack of co-operation from the worker’s side. Hence, if no systematic way exists for bringing workers complaints or grievances to the surface, they may pile up and explode into an industrial dispute.

A good grievances handling should:

- be simple, easy to understand and to operate

- settle grievances at lower level

- systematically handle the grievances and promptly rectify the condition complained of

- depending upon the nature of grievance, refer it to appropriate authority

- ask the employee to give the complaint in writing

- permit the workers to appeal against the decision taken at lower level and

- the grievance procedure should be made realising the importance of industrial harmony and good labour relations.

Q6(iii)TQM: Total Quality Management :TQM (Total Quality Management) is a system approach to quality in all spheres of the organisation. TQM means meeting the requirement of internal/external customers consistently by continuous improvement in the quality of work of all employees. Total in QM stands for an overall integrated approach to all aspects of quality, all domains of system including organisation, people, resources, time, hardware/software and even management committees. TQM is a management approach of organisation, centered on quality, based on participation of all its members and aiming at long term success through customer delight and benefits to the members of the organisation and society. TQM sustains on four pillars viz systems, top Management commitment, Team work and Statistical Process control (SPC) Tools. The principal objectives of TQM are :-

(i) Customer Focus viz Customer Delight.

(ii) Continuous improvement as a culture of the organisation which must be the way of life.

(iii) Focussed, continuous and relentless cost reduction.

(v) Focussed, continuous and relentless quality improvement.

(v) To create an organisation whereby everyone is working towards making their organisation the best in its business and to capitalize on the sense of achievement and working in a world-class organisation.

Q6(iv) Workers’ Participation in Management: Worker’s participation in management can be in any shape, from establishing work-committee to auto-management by the employees. The aim of management is to get work through others. Workers, if they are permitted to participate and involve themselves in some of the decisions relating to work situation, etc., perhaps more effectively the company objectives can be achieved.

Objective or Necessity. The objective or the necessity of permitting workers to participate in management can be:

(i) To achieve industrial peace and harmony.

(ii) To develop internal motivation in the workers.

(iii) To boost the morale of employees.

(iv) To raise the levels of the employee production, productivity and product quality.

(v) To satisfy workers by making them feel that they have their voice in the management.

(vi) To give workers a better understanding of their role in the working of industry.

(vii) To develop better mutual understanding so that the workers do not resist a change for the betterment of the concern(e.g., introduction of work study, etc.)

(viii) To minimize the number of grievances and therefore, industrial disputes .

(ix) To make managing of the subordinates easy.

Types of Worker’s Participation - Worker’s participation in management may take many forms, e.g

(a) Formal participation – consist of some plan for labour management cooperation.

(i) Ascending participation – where elected representative of workers participate in management decisions at higher levels.

(ii) Descending participation – where workers participate in planning and deciding their own work in shop floor.

(b) Informal participation – It is more typically at the work group level, where the foreman develops the opportunities for the group of workers to take part in a problem solving or decision making process.

PART II

Q7(a) Skills required of a Successful Manager:The skills required of a successful manager, whether he is working in a industry, business organization, an educational institute or a hospital etc. can be classified as follows: -

(a) Technical Skills.

(b) Conceptual Skills.

(c) Human Relations Skills.

Technical skill refers to the proficiency in handling methods, processes and techniques of a particular kind of industrial/business operation. It is essential for a manager to know which technical skill should be employed in a particular work. Technical skill is essential for lower level management.

Conceptual skill is the ability to see the organization as a whole, to recognize inter-relationships among different functions of the business and external forces, and to guide effectively the organizational efforts. It is critical in top executive positions. It is easier to learn technical skill than the conceptual skill. Conceptual skills are decision-making skills (ability of the person to take timely and accurate decisions) and organizational skills(they help fix different people at different jobs).

Human Relations skill refers to the ability to work effectively with others and build cooperative work groups to achieve organizational goals. Communicating skills (ability to pass on information to others effectively) and motivating skills (inspiring people to do what you want them to do) are the two Human Relations skills.

Need for skills at different levels of Management is shown below in the diagram:-

Q7(b) Different types of Decisions: Decisions may be of different types. Some of the important types of managerial decisions are explained below :-

(i) Programmed and Non-Programmed decisions

Programmed decisions are those made in accordance with some habit, rule or procedure. Non-Programmed decisions are those that deal with unusual or exceptional problems.

(ii) Major and Minor Decisions

Decision with regard to financial outlay can be major or minor. A decision related to the purchase of a CNC machine costing several lakhs is a major decision and purchase of a few reams of typing paper is a minor (matter or )decision.

(iii) Routine and Strategic Decisions

Routine decisions are of repetitive nature, do not require much analysis and evaluation, are in the context of day-to day operations of the enterprise and can be made quickly at middle management level. Strategic decisions relate to policy matter, are taken at higher levels of management after careful analysis and evaluation of various alternatives, involve large expenditure of funds and slight mistake in decision making is injurious to the enterprise.

(iv) Organizational and Personal decisions

A manager makes organizational decisions in the capacity of a company officer. Such decisions reflect the basic policy of the company. They can be delegated to others. Personal decisions relate the manager as an individual and not as a member of an organization. Such decisions cannot be delegated.

(v) Individual and Group decisions

Individual decisions are taken by a single individual in context of routine decisions where guidelines are already provided. Group decisions are taken by a committee constituted for this specific purpose. Such decisions are very important for the organization.

(vi) Policy and Operative decisions

Policy decisions are very important, they are taken by top management, they have a long-term impact and mostly relate to basic policies. Operative decisions relate to day-to-day operations of the enterprise and are taken at lower or middle management level.

(vii) Long-term, Departmental and Non-Economic decisions

In case of long term decisions, the time period covered is long and the risk involved is more. Departmental decisions relate to a particular department only and are taken by departmental head. Non-economic decisions relate to factors such as technical values, moral behaviours etc.

Q8(a) Functions and Objectives of Trade Unions: The functions of trade unions are :-

(i) The provision of friendly services such as a place for leisure pursuits, information about jobs existing in other factories, games and outings, etc.

(ii) The provision of social services such as insurances against old age, unemployment, strike, pay, payment for hospital fee, legal services etc.

(iii) Wage bargaining, i.e collective wage bargaining with the employers.

(iv) Safeguarding the job of the workers.

(v) Political activities, i.e. the political pressure for reform, e.g. trade union legislation works to protect the union and the workers from such industrial abuses as delay in payment of wages, excessive hours of work, poor working conditions, etc.

(vi) To develop cooperation with employers.

(vii) To arouse public opinion in favour of labour.

(vii) To secure some shares in profit and in the control of the enterprise.

The Objectives of trade unions are :-

(i) To take labour out of the competitive process; because if a number of workers freely compete for a job, the employer will definitely offer them less wages.

(ii) To negotiate at all levels with employers over wages and conditions of work.

(iii) To protect the workers in their inalienable right to higher and better life.

(iv) To make workers to take part in union activities and to obey union rules and decisions.

(v) To protect and promote the interests of the workers.

(vi) To provide legal assistance to workers (i.e. union members) in connection with work affairs.

(vii) To improve economic status of workers.

(viii) To protect the jobs of the workers against lay off, retrenchment, etc.

Q8(b) Advantages and Limitations of Budgets: The advantages and limitations of budget are as follows:-

Advantages :-

(i) Policy, plans and actions taken are all reflected in the budgetary control system. There is a formal recognition of the targets which the business hopes to achieve.

(ii) Not only departmental programmes are developed, over expenditures in departments are also curtailed and controlled.

(iii) Budgeting makes for better understanding, coordination and harmony of action in a business enterprise, because all departments take part in budget preparation.

(iv) The targets, goals and policies of a business enterprise are clearly defined.

(v) Deviations from predetermined plans are brought to notice through variance analysis and corrective action is stimulated by reports, statements and personal contacts.

(vi) It provides management with a guide of daily activities; thus helps determining performance and efficiency of each department, thereby leading to improvement.

(vii) It informs management the progress made towards achieving the predetermined objectives.

(viii) It facilitates financial control.

(ix) Total capital required and price of an item(product) can be estimated in advance.

(x) Budgetary control builds morale when operated in a truly managerial spirit, i.e., it should not acquire merely a clerical outlook (or approach).

Limitations :-

(i) Since budget is based on estimates, i.e., estimated sales, estimated costs, estimated business conditions, etc. it may need periodic revisions because estimates may not come out to be cent percent true.

(ii) A budget may not work if the idea of budgeting is not sold properly to different sections of the business. Only the persons working in different sections can make an established budget, a success. Thus, it should be a cooperative budgeting.

(iii) A budget cannot work until the desire to make it work is established in the minds of persons working in the different sections of a business concern.

Q9(a) Important provisions of Factory Act, 1948:The important provisions of Factories Act, 1948 are as follows:-

a) Health: The following are the important provisions for employee health:-

(i) Cleanliness

(ii) Disposal of Wastes and Effluents

(iii) Ventilation and Temperature

(iv) Dust and Fumes

(v) Artificial Humidification

(vi) Overcrowding

(vii) Lighting

(viii) Drinking Water

(ix) Latrines and Urinals

(x) Spittoons

b) Safety: The provisions with regard to safety are:-

(i) Encasing and fencing of machinery

(ii) Work on or near machinery in motion

(iii) Employment of young persons on dangerous machines

(iv) Hoist and lifts

(v) Lifting machine, chains, ropes and lifting tackles

(vi) Pressure plants

(vii) Floors, stairs and means of access to different places

(viii) Pits, sumps, openings in floors, etc.,

(ix) Excessive weights

(x) Protection of eyes

(xi) Precautions against dangerous fumes

(xii) Explosive or inflammable dust, gas, etc.

(xiii) Precautions in case of fire

c) Welfare: Provisions related to welfare are as below:-

(i) Washing facilities

(ii) Facilities for sitting

(iii) First aid appliances

(iv) Canteens

(v) Shelters, rest-rooms and Lunch-rooms

(vi) Creches

(vii) Welfare officers

d) Working Hours: The provisions with regard to working hours deal with the following:-

(i) Weekly hours

(ii) Weekly holidays

(iii) Daily hours

(iv) Intervals for rest

(v) Extra wages for over-time

(vi) Restriction on double employment

(vii) Register of adult workers

(viii) Restrictions on employment of women

e) Employment of Young Persons: The provisions are as below:-

(i) Prohibition of employment of young children

(ii) Non-adult workers

(iii) Certificate of fitness

(iv) Working hours for children

(v) Register of child workers

Q9(b) Barriers to Successful Communication: A barrier to successful communication does not permit the transmission of accurate and full information at the receiving end. A communication barrier breaks down, obstructs, delays,, distorts and tends to give another colour to the information by the time it reaches the destination.

Various barriers to successful communication are:-

(i) More levels in the organisation structure through which an information has to pass.

(ii) Long and ill-structured channels of communications.

(iii) heavy work-loads at certain levels in the organisation structure.

(iv) Attitude – either not to hear or to hear what one expects to hear.

(v) Prestige and superiority complex.

(vi) Sender and Receiver having different perceptions.

(vii) Sender unable to symbolize the information correctly.

(viii) Prejudiced and biased attitude of the receiver.

(ix) Receiver unable to get the information (subject to different meanings) clarified.

(x) Receiver ignoring conflicting information.

(xi) Receiver tending to evaluate information from his own angle.

(xii) Receiver emotionally upset.

Q10(a) Industrial Management: Industrial Management involves guidance,

leadership and control or efforts of a group of individuals toward some

common goals of the industry.

The Industrial Manager is involved in the following functions:-

(i) design products that will find acceptance in competitive markets;

(ii) devise methods of producing such products efficiently;

(iii) explore reliable sources for obtaining materials and supplies;

(iv) attract funds;

(v) build plants, recruit and train employees with a wide variety of talents.

(vi) devise systems for coordinated efforts; and

(vii) inspire confidence and activate all the resources (facilities) into a viable going concern.

However, the job of industrial Manager becomes still more difficult due to

(i) change in market;

(ii) change in technology;

(iii) change in attitude and feeling of people; and

(iv) change in government regulations, etc.

Though industrial management involves all aspects of management, its peculiarity with reference to the industry, makes it unique in its characteristics and job content.

Q10(b) Objectives and Characteristics of Organisational Development

(OD):

Objectives of OD

(i) Improvement in the performance of the organisation.

(ii) Improvement in the ability of the organisation to adapt to its

environment, and

(iii) Improvement in inter-personal and inter-group behaviour to

secure team work.

Characteristics of OD

(i) Organisational development is an educational strategy for

bringing a planned change.

(ii) It is related to real problems of the organisation.

(ii) Laboratory training methods based on experienced behaviour

are primarily used to bring change.

(iv) Organisational Development uses change agent (or consultant) to guide and effect the change. The role of change agent is to guide groups towards more effective group processes rather than telling them what to do. Change agents simply assist the group in problem solving processes and the groups solve the problems themselves.

(v) There is a close working relationship between change agents and the people who are being changed.

(vi) Organisational Development seeks to build problem-solving capacity by improving group dynamics and problem confrontation.

(vii) Organisational Development reaches into all aspects of the organisation culture in order to make it more humanly responsive.

(viii) Organisational Development is a long term approach (of 3 to 5 years period) and is meant to elevate the organisation to a higher level of functioning by improving the performance and satisfaction of organisation members.

(ix) Organisational Development is broad-based and describes a variety of change programmes. It is concerned not only with changes in organisational design but also with changes in organisational philosophies, skills of individuals and groups.

(x) Organisational Development is dynamic process. It recognise that the goals of the organisation change and hence, the methods of attaining them should also change.

(xi) Organisational Development utilizes system thinking. It is based on open, adaptive systems concept. The organisation is treated as an interrelated whole and no part of the organisation can be changed without effecting other parts.

(xii) Organisational Development is research based. Change agents conduct surveys, collect data, evaluate and then decisions are taken.

(xiii) Organisational Development uses group processes rather than individual process. It makes efforts to improve group performance.

(xiv) Organisational Development is situational and contingency oriented.

(xv) Organisational Development and Management Development are complementary rather then conflicting.

Q11(i) Line and Staff Organisation: As the industry grew in size and complexity,

the line executives could not perform properly all other functions such as

R&D, planning, distribution, legal, public relations etc,. This necessitated the

employing of special executives to assist line executives and they were known

as Staff since they were recruited to perform staff or specialist functions. The

line executives retain supervisory authority and control over the work of their

subordinates whereas the staff executives relieve the line executives of certain

specialized work and advise them on matters referred to them. The following

figure shows the line and staff organization

Q11(ii) Managerial Leadership:Effective managing requires leadership. It is seldom possible to segregate the behavioural functions of managership and leadership. It is because, every act of influence on a matter of organizational relevance is in some degree an act of leadership.

A manager organizes, directs and controls various activities of the enterprise directed towards specific ends. A leader, on the other hand, inspires confidence and trust in his subordinates, gets maximum cooperation from them and guides their activities in organized effort.

Specifically, managerial leadership is behaviour that elicits voluntary follower behaviour beyond that associated with required performance on a job. Leadership is “the influential increment over and above mechanical compliance with the routine directives of the organization”.

A manager’s leadership behaviour is what makes the difference between effective and ineffective organizations. Managerial leadership combines the skills of a manager and the qualities of a leader.

The concept of managerial leadership is important because the term itself suggests the necessity of bringing together the managerial and leadership roles for the more effective task performance, organizational effectiveness and human satisfaction.

The managerial leader, then, is generally evaluated on both formal task accomplishment and informal basis of personal and group goal accomplishment.

Q11(iii) Effects of Indiscipline: The indiscipline in industry brings in certain adverse effects. These are as below:-

a) Increase in the following factors:-

i) Absenteeism. Absenteeism on the part of employees which can be willful/deliberate and sometimes organised.

ii) Accidents. Accident due to casual attitude of employees and at times willful/deliberate.

iii) Sick Leave. Employee may feign sickness and take sick leave.

iv) Labour Turn-over. The employees leaving the organisation due to disciplinary procedures and adverse organisational environment.

v) Grievances and frustrations. The grievances and frustrations amongst the employees are bound to result in organised resistance to companies policies.

vi) Waste and Scarp Rate. These could be due casualness in working and at time due to willful/deliberate acts on the part of employees.

b) Decrease in the following factors:-

i) Production. The quantum of output in products or services may decline due to indifferent attitude of employees or due to their deliberate actions.

ii) Product Quality. The reduction in quality could be again due to deliberate actions on the part of employees or due to their indifferent attitude.

iii) Employee Morale. Due to the indiscipline environment/ atmosphere, the morale of employee would become low.

Q11(iv)Cost Benefit Analysis: Cost-benefit analysis is a mathematical technique for

decision-making. It is a quantitative technique used to evaluate the economic costs and the social benefits associated with a particular course of action. In this technique, an effort is made to identify all costs and benefits, not only those that may be expressed in rupees, but also the less easily calculated effects of a given decision.

In general, this technique (which is fairly complicated) is advocated for use in decisions on public projects, in which social costs and social benefits, as well as, actual out-of-pocket costs should be taken into account. What counts as a benefit or loss to one part of economy – to one or more persons or groups-does not necessarily count as a benefit or loss to the economy as a whole. And in cost-benefit analysis we are concerned with the economy as a whole, with the welfare of a defined society and not any smaller part of it. But cost-benefit analysis may also be applicable to a single company, for in many cases, it is advisable to place a value on costs and benefits that are not ordinarily expressed in rupees.

Some what similar to cost-benefit analysis is the cost-effectiveness analysis, which is an analysis to determine the least expensive way of reaching an objective or of obtaining the greatest possible value from a given expenditure.