Business Management Functions and Practices 1


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Q1): The principles of scientific management differ from the ordinary principles. Why? Give your comments.

Q2): Discuss the new challenges and tasks of management. Explain the contributions of Taylor and Henry Feyol in modern management thoughts.

Q3): Define leadership. Explain the features and importance of Mc Gregor’s theory X and Y?

Q4): Are strategies and policies as important in a non business enterprise (such as a lobour union, State Department, a hospital or a city fire department) as they are in a business? Why and how?

Q5): Your Company offers you a promotion to a position in a location your family does not like. Make the necessary assumptions and then state how and what you would decide.


Q1): What are the major limitations of Planning? What action can be taken to make planning effective?

Q2): “The contingency approach to management is more a commonsense approach “-elaborate.

Q3): Accurate appraisal of performance is difficult. In the light of this discuss the problems involved in appraising an employee.


Automotive Components Limited is a major manufacturer of automatic filters mostly used in automobiles of various types. It supplies filters directly to automobile manufacturers in bulk quantity besides supplying to the market for replacement One day, two engineers from a reputed engineering consultant visited the factory. They inspected the production facilities and workshop. They came on the next two days also. During their visit, the atmosphere in the workshop was tense as the engineers made several enquiries from the foreman of the workshop. Three days after the last visit of these engineers, a notice was put up asking the workers to shut off motors and lights during the lunch break.

During the following week, a rumour spread that the company was not able to discharge its contractual commitments because of the technical defects in the plant. Therefore, a big order was likely to be cancelled resulting into closure of the plant for some time. This period became quite disturbed both for workers as well as for the foreman. Three workers made enquiries on different occasions from the foreman about the reasons for the visits by the outside engineers. In fact, one of the workers put a question, “Is there going to be layoff in the plant”? The foreman himself being ignorant in the matter had little to say. Thus, rumours spread further about the likely layoff and retrenchment of some workers.

The workers became nervous and productivity dropped. They approached their union leaders about the possible layoff and retrenchment. The union leaders criticised the approach of the management and threatened strike if any worker was laid off or retrenched

On getting this news of lower productivity and threat of strike, the production manager visited the plant and talked to the foreman and some of the senior workers. One of the office bearers of the union questioned angrily as to when some of them are to be thrown out. The production manager was taken by surprise and asked the foreman what workers were talking about The foreman narrated the total situation right since the visits of outside engineers and notice of conserving power. He also told about the rumour of cancellation of big order and consequent retrenchment of some of the workers. The production manager was taken aback and could not believe what the foreman was saying. He asked the foreman, “But all this is not true; did you not tell the workers?” The foreman kept quiet

Later in the day, the production manager called a meeting of union office bearers along with some workers. He also invited the foreman to attend the meeting. In the meeting, the production manager informed about the objectives of the visits of outside engineers. He told that the engineers were invited to observe the existing machine layout and to draw plan for installing a new equipment. He explained that notice for putting off motors and lights during the lunch break was meant to save power as there was shortage of power and this had nothing to do with the visits of the engineers. Regarding the cancellation of order, he agreed that one big order was likely to be cancelled because of some troubles at the buyer’s plant but the company had secured a much bigger order and that instead of layoff, there would in fact be more recruitment But all these could not convince the workers and after two days, the union gave a notice to the production manager for a one day protest strike.


1. Discuss the reasons for the problems that arose in the company.

2. Advise the production manager how he should proceed in the matter.


Imagine that your marketing company has just merged with a manufacturing organization. You have been asked to help provide some “basic” managerial training to the engineers in the research and development unit of the new sister company. To make sure you are covering the necessary issues, your boss has asked to see an overview of materials that you will be providing the engineers. (Q1 to 5)

1.Now that both companies are merged and are a systematic arrangement of people set to accomplish a specific purpose, they could be described as a (n).

a) business unit

b) multinational company

c) organization

d) holding company

2. One of the first things the engineers need to learn is that are the people who direct the activities of others in an organization.

a) directors

b) managers

c) subordinates

d) line workers

3. Another fact that engineers need to learn is that supervisors may frequently be referred to as .

a) middle managers

b) top managers

c) project leaders

d) first-line managers

4. Many of the engineers in the group are unclear about what managers actually do. Your training materials explain that a manager’s job focuses on.

a) the performance of clerical duties

b) personal achievement

c) helping others accomplish their work goals

d) supervising groups rather than individual employees

5. Which argument for social responsibility puts forth the belief that by becoming socially responsible, businesses can expect to have less government regulation?

a) discouragement of further government regulation

b) stockholder interests

c) public expectations

d) public image

As a business expansion director, Shana’s goal is to scout out potential locations and basically provide input on how her company should proceed with its planned expansion to Europe. There are many options, including maintaining the business’s head office in the United States and sending over company representatives when necessary or establishing separate operations facilities abroad and hiring locals as managers. (Q6-9)

6. If Shana’s company decides to open another company in France but maintain its management in the United States, it would be considered.

a) a transnational corporation

b) a multinational company

c) a regional trade alliance

d) a joint venture

7. If Shana’s company decides to open a completely new operation in Germany, tailoring the company to local customs and marketing strategies and hiring local managers, it would be considered.

a) a multinational corporation

b) a borderless organization

c) a regional trade alliance

d) a transnational corporation

8. If Shana’s company eliminates country-designated locations and reorganizes based on industry groups, it would be considered a .

a) borderless organization

b) strategic partnership

c) global business alliance

d) multination corporation

9. One section of Shana’s company’s business plan involves strategic alliances and joint ventures. This section is most likely focused on the phase of the company’s global business expansion.

a) legal

b) middle

c) final

d) preliminary

10.______________________ Classical management thinkers .

a) utilize the “it all depends” approach

b) utilize quantitative decision-making tools

c) look for the one best way to do something

d) realize that their most important and complex resource is people

11. The Hawthorne studies are an important foundation of the ______approaches.

a) classical

b) human relations

c) administrative

d) quantitative

12. Models, simulations, and queuing theory are examples of techniques found in the
approach to management.

a) classical

b) quantitative

c) bureaucratic organization

d) modern

13. Which of the following statements does not accurately reflect the characteristics of
contingency theory?

a) Managers should draw on all past theories in attempting to analyze and solve problems

b) The best way to initially approach all management problems is through scientific management

c) The contingency approach is integrative in nature.

d) Managers should stay flexible and consider the alternatives and fallback positions when defining and attacking problems.

14.____________ In a fast-changing environment, the most effective method of improving the quality of a product would be .

a) Kaizen

b) bureaucracy

c) reengineering

d) management science

15. A manager’s first step in the decision-making process is to__________

a) define the problem

b) identify limiting factors

c) develop potential alternatives

d) establish a control and evaluation system

16. When a manager knows what the problem is and what the alternatives are, the manager is making the decision under the condition of__________.

a) imperfect resources

b) risk

c) uncertainty

d) certainty

17. A quantitative technique for decision making that shows a complete picture of potential alternative decision paths is called_______.

a) the Delphi technique

b) a decision tree

c) brainstorming

d) payback analysis

18. A group effort of generating alternative ideas that can help a manager solve a problem is called______.

a) the Delphi technique

b) out-of-the box thinking

c) brainstorming

d) the nominal group technique

19. All of the following are important strategies that a manager can use to create a more
effective decision-making environment except______.

a) encourage others to make decisions

b) be ready to try things

c) rely solely upon himself or herself

d) recognize the importance of quality information

20. Which of the following is not a proactive reason why a business becomes international?

a) Economies of scale

b) Searching for new customers

c) Remaining competitive

d) Needing raw materials and other resources

21. Which of the following is not a common characteristic of most multinational corporations?

a) Creating foreign affiliates that may be owned or jointly held

b) Relying upon standardization of the product and marketing that Product throughout the world

c) Viewing the world as the market

d) Locating affiliates in the developed countries of the world

22. Some of the major concerns of a multinational company are the stability of a country’s currency and the availability of needed raw materials and supplies. These are elements of which environment?

a) Political

b) Legal

c) Economic

d) Sociocultural

23. Which of the following describes planning and the international manager?

a) It is far less complicated for the international manager than for the manager’s domestic counterpart

b) Planning is far more complicated for the international manager than for the manager’s domestic counterpart

c) There is no difference in the level of difficulty between the planning in domestic and international operations.

d) Planning is done by host-country personnel only.

24. Which of the following describes the sociocultural dilemma facing the international

a) The international manager needs only to know the culture of the host country.

b) Most host countries require international managers to apply for citizenship in order to acquire knowledge of the culture.

c) The manager should carefully avoid integrating the home- and host-country cultures.

d) The international manager not only must understand the culture of the host country, but also how that culture differs from his or her home-country culture.

25. Several studies regarding leadership traits have proven which of the following:

a) Leadership traits are universal.

b) No specific list of successful leadership traits exists.

c) Leadership traits, skills, and behaviors are common.

d) Successful leaders have similar personalities.

26. Which type of power is least associated with the autocratic style of leadership?

a) Referent

b) Expert

c) Formal

d) Nonconforming

27. When sport coaches listen to players’ suggestions and feedback during game
intermission, they are using what type of leadership?

a) Free-rein

b) Autocratic

c) General

d) Participating

28. The contingency, path-goal, and life-cycle theories of leadership are considered

a) autocratic.

b) organizational.

c) situational.

d) unrealistic.

29. Vision, charisma, integrity, and symbolism are all on the list of attributes associated with what type of leaders?

a) Contingency

b) Informal

c) Transformational

d) Transactional

30. Motivational theories that emphasize the needs that motivate people are called

a) process theories.

b) goal-setting theories.

c) content theories.

d) path-goal theories.

31. All of the following are examples of hygiene factors except

a) the work itself.

b) salary.

c) company policies.

d) working conditions.

32. According to Alderfer’s ERG theory, existence needs can be described as

a) needs for satisfactory relationships with others.

b) calls for realizations of potential.

c) calls for the achievements of competence.

d) a person’s well being.

33. According to expectancy theory, the intensity of motivation functions is

a) very difficult to determine.

b) indirectly proportional to perceived rewards.

c) directly proportional to perceived or expected rewards.

d) indirectly proportional to expected rewards.

34. When a manager redesigns a job so that the job includes an increased number of tasks, but does not address the issues of the quality of the challenge of the tasks, the manager is utilizing

a) job depth.

b) job rotation.

c) job enrichment.

d) job enlargement.

35. In order for a group to be considered a team,

a) at least two people must be involved.

b) the members must interact regularly and coordinate their work.

c) the members must share a common objective.

d) All of the above.

36. Teams designed to complete a specific task in an organization are called

a) product development teams.

b) project teams.

c) quality teams.

d) process teams.

37. The stage of group development in which the team members come together to resolve conflict, achieve unity, and understand the roles members pay is:

a) performing.

b) storming.

c) forming.

d) norming.

38. The benefits of teams include all the following except

a) flexibility.

b) commitment.

c) team training costs.

d) synergy.

39. When a manager chooses to ignore a conflict situation, the manager is choosing which conflict resolution strategy?

a) Compromise

b) Collaboration

c) Appeal to a superordinate objectives

d) Avoidance

40. An in-depth study of all the positions in an organization is described as a

a) job evaluation.

b) job description.

c) job analysis.

d) job specification.


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