Practice Exam 1
Choose four (4) of the following questions and answer them in short essay format. All questions are worth equal marks. (12. 5 marks each) QUESTION 1 (12. 5 marks) Discuss the key factors in the international environment that managers of emerging global organisations look to as threats to their international operations. Provide examples as appropriate. International Environment is the management of business operations conducted in more than one country and usually outside of the organisations normal environment (out of the country).
Legal-Political Environment: Political systems the organisation may be unfamiliar with; dealing with the government. – Political stability – Quotas, tariffs and taxes – Law and regulation Economic Environment: Economic conditions in which the organisation operates in – Consumer Market – Exchange rates – Economic development (Developing country? Depression? ) Sociocultural Environment: Common behaviour and way of thinking among the consumers. – Religion – Time orientation – Beliefs and values(Hofstede) – Language QUESTION 2 (12. 5 marks)
What are Porter’s competitive forces in an organisation’s environment? Explain them and provide examples to illustrate your answer. Threat of new entrants: – Capital requirements and economic of scale are potential barriers – Easier to enter mail order business than automobile due to high capital cost – Technology made it easier for new entrants to enter market. – Threat of existing rivalry: – Coke VS Pepsi, Toyota VS Honda – Influenced by the other four forces and cost-product differentiation Threat of substitute products: – Affected by cost changes or trends Internet open new ways to meet customer needs – Low cost airline tickets VS travel agencies Bargaining power of buyers: – Few buyer, many suppliers. Goods are standardised. (High buyer power) – Buyer gets more information about the car they want to buy; accident before? Bargaining power of suppliers: – Many buyers, few suppliers. Highly valued products. (High supplier power) – Airplane engine suppliers will have great power due to lack of competition – Internet helps the suppliers to reach end users and greater number of buyers
QUESTION 3 (12. 5 marks) What is the difference between organisational structure and organisational design? Outline the six elements of organisational design. Organisational structure is a framework that defines the way tasks are assigned, the formalization of reporting relationships and the effectiveness of coordination of employees across departments. It is an expression of who is performing various tasks and how they are related to one another whereas organisational design is the process of reshaping or changing the organisation structure.
Organisation leaders develop plans to function or perform better. Six elements are: 1) Work Specialisation – A. k. a Division of labour. Main idea is to divide the jobs so that everything is not done by one individual. Employees can focus on doing specific functions in their own department allowing them to effectively and efficiently specialise in that particular job. 2) Chain Of Command – Line of authority from the upper level of organisation to lower level of organisation and classifies who reports to whom. Unity of command where each employee is held accountable to only one supervisor.
Scalar Command defined line of authority that refers to all employees. 3) Responsibility, authority & delegation – Authority is the legitimate right of managers to issue orders, make decisions and allocate resources. Responsibility is the duty to perform a task an employee is assigned to and usually comes with authority for managers. Delegation is the transfer of authority to a lower level position in the hierarchy. 4) Span of management – Refers to the number of employees reporting to a supervisor. Also known as span of control.
Determines the number of employees a supervisor can effectively and efficiently manage. 5) Centralization & decentralization – Centralization is when the authority is located at a single point usually at the top level of the organisation and decentralization is when decision authority is pushed down to lower organisation levels. Decentralization is believed to relieve burden on top managers, make greater use of worker skills and abilities and permit rapid response to external changes. 6) Formalization – Process of creating written documents to direct and control employees.
These include rule books, regulations and job descriptions. These provide the employees with descriptions of tasks, responsibilities and decision authority. QUESTION 4 (12. 5 marks) A contingency approach to leadership seeks to explain the relationship between leadership styles and specific situations. Describe Hersey and Blanchard’s situational leadership model. Provide examples to illustrate your answer. [pic] QUESTION 5 (12. 5 marks) Managers faced with ethical choices have a number of approaches that they may use to guide their decision making.
Discuss the various approaches to ethical decision making, providing examples to help explain your answer. Utilitarian approach is the moral behaviour of producing the greatest good for the greatest number. Decision makers are to consider the effect of all parties and select one that best gives satisfaction to the greatest number of people. Squatter homes are not abolished because the government may find that leaving the squatter homes untouched may be a better option as it provides as a home for many people.
Dunlop closed their manufacturing plant in Australia and decided to open one in Thailand and Malaysia, managers justified that decision on the basis that it produces greater good to the company as a whole. Individualism approach promotes the individual’s best long term interests which will lead to the greater good. The action in which is intended to produce greater good than bad to the individual rather than other alternatives. This will in turn, lead to greater good as individual’s behaviour fits the standards of behaviour people wants towards themselves.
Moral rights approach defines the fact that human beings have rights and liberties that cannot be taken away by another individual. This approach suggests companies to maintain the rights of the people affected by it. Western countries give their people the right to have their own say (freedom of speech) and in some companies, they give their customers the freedom to speak and complain. Hence, the saying the customer is always right. Justice approach is the moral decision based on equality, fairness and impartiality. There are 3 types of justice concerning managers: distributive ustice where people should not be treated differently based on illogical characteristics such as gender. Procedural justice where rules should be administered fairly and consistently and Compensatory justice where individuals should be compensated for the cost of their injuries by the party responsible. QUESTION 6 (12. 5 marks) A current issue for HRM involves the changing nature of careers, and the evolving dynamic of relationships between employers and employees. Discuss the major issues involved in the changing nature of careers, and the HR issues in the new workplace. Provide examples as appropriate.
Major Issue: Changing social contract Issues in new workplace: 1) Becoming employer of choice – company highly attractive to employees due to HR practices that focus on not only tangible benefits but intangible too. 2) Team & Projects – People who used to work alone now has to work in groups. Many workers handle multiple tasks and responsibilities. 3) Temporary employees – Demand has grown for professionals. Contingent workers means reduced payroll and benefit costs as well as increased flexibility for both employer and employee. 4) Technology – Virtual teams and telecommunicating ) Work/Life Balance – Telecommunicating helps employees work from home to balance life and work. 6) Downsizing – Some companies have to downsize and let employees go. ———————– Old contractNew Contract Employee Employer – Job felt secure – One part of the organisation – Knowing – Routine Jobs – Standard training programs – Limited information – Traditional compensation package (typical benefits) – Manage own career (employment not guaranteed) – Partner in business improvement – Learning – Challenging assignments – Continuous learning, lateral career – Information & resources – Creative development opportunities