third assignment

MOHANDAS COLLEGE OF ENGINEERING AND TECHNOLOGY

MASTER OF COMPUTER APPLICATIONS

Principles of Management

Assignment -3(i)

Max. Marks: 30                                                                                                           10-09-2012

Date of Submission:    28-09-2012

GROUP I

1.        What do you mean by 360 degree appraisal?                                                                                  (5)

2.        Explain the relevance of vestibules.                                                                                                   (5)

3.        State the relevance of Manpower inventory.                                                                                  (5)

4.        Distinguish between Job description and Job specification with an example.                          (5)              

5.        How does Personnel department function as a link to other functional departments?      (5)              

6.        How do mathematical models help in the process of planning and forecasting?                    (5)

GROUP II

1.     Explain the performance appraisal process.                                                                        (5)

2.     Explain the role of HR function in a global I.T. firm.                                                           (5)

3.     Illustrate the selection process. Why it is called a negative process?                    (5)

4.     Define MBO in planning.                                                                                           (5)

5.     What is meant by manpower forecasting?                                                              (5)

6.     Write in brief about Promotion and its policies.                                                     (5)

forecasting

What is Forecasting? Meaning
Forecasting is a process of predicting or estimating the future based on past and present data. Forecasting provides information about the potential future events and their consequences for the organization.
It increases the confidence of the management to make important decisions.
 Forecasting is the basis of premising/planning.
 Forecasting uses many statistical techniques. Therefore, it is also called as Statistical Analysis.
Features of Forecasting
1.      Forecasting in concerned with future events.
2.      It shows the probability of happening of future events.
3.      It analysis past and present data.
4.      It uses statistical tools and techniques.
5.      It uses personal observations.

Importance of Forecasting
1.      Promotion of Organization

Organization wan s to achieve objectives
How? Performing some activities
Which activities? Based on expected outcome.
Expected outcome is related to future, so forecasting is needed to achieve objectives.
So a successful promoter forecast what will happen.
2.      Key to planning
Forecasting provides relevant and reliable information about the past and present events and the likely future events. This is necessary for sound planning. It is the basis for making planning premises.
Example: A steel pipe manufacturer find that gradually PVC pipes are coming in to market , with cheaper rate and they will replace steel pipes, so they take suitable action to overcome this problem. ie. Diversify their business by going into manufacturing of PVC pipes.
3.      Success in Organization
Each organization is characterized by risks. Risk is based on future happenings ie. Uncertain / unpredictable things.
Forecasting reduce uncertainty by providing clues about what will happen in the future.
Manager acts like a navigator. He cannot control sea tides, but he can take this ship at the right path if he knows them in advance.
4.      Confidence to managers
It gives confidence to the managers for making important decisions.

Limitations of Forecasting
Time and cost factor
The collection and analysis of data about the past, present and future involves a lot of time and money. Therefore, managers have to balance the cost of forecasting with its benefits. Many small firms don't do forecasting because of the high cost.
Not absolute truth
Forecasting can only estimate the future events. It cannot guarantee that these events will take place in the future. Long-term forecasts will be less accurate as compared to short-term forecast.
Based on Assumptions
Forecasting is based on certain assumptions. If these assumptions are wrong, the forecasting will be wrong. Forecasting is based on past events. However, history may not repeat itself at all times. There are various factors which determine the occurrence of an event. The behavior of these factors may change/unpredictable.
Eg: If the government increases taxes on certain commodities, their substitutes will be in high demand. The changes in tax structure cannot be forecast in all cases.
War between two countries can change the total business situations.
Managers judgment
Forecasting requires proper judgment and skills on the part of managers. Forecasts may go wrong due to bad judgment and skills on the part of some of the managers. Therefore, forecasts are subject to human error.

Steps in Forecasting

Procedure, stages or general steps involved in forecasting are given below:-

•        Analysing and understanding the problem : The manager must first identify the real problem for which the forecast is to be made. This will help the manager to fix the scope of forecasting.
•        Developing sound foundation : The management can develop a sound foundation, for the future after considering available information, experience, type of business, and the rate of development.
•        Collecting and analyzing data : Data collection is time consuming. Only relevant data must be kept. Many statistical tools can be used to analyze the data.
•        Estimating future events : The future events are estimated by using trend analysis. Trend analysis makes provision for some errors.
•        Comparing results : The actual results are compared with the estimated results. If the actual results tally with the estimated results, there is nothing to worry. In case of any major difference between the actual and the estimates, it is necessary to find out the reasons for poor performance.
•        Follow up action : The forecasting process can be continuously improved and refined on the basis of past experience. Areas of weaknesses can be improved for the future forecasting. There must be regular feedback on past forecasting.

types of planning

Types of planning/ Methods of Planning
1.    Corporate planning and Functional planning
Corporate planning
Planning at top level, which covers entire organizational activities.
Determine long term objectives of organization and generate plans to achieve these objectives.
Functional planning
            Planning for departments.
            Marketing plan for marketing department.
2.    Strategic planning and Operational planning
Strategic planning
It is the process of determination of basic long term objectives of an enterprise, the adoption of course of action and allocation of resources to achieve these goals.
Operational planning/ Tactical planning
It is the process of deciding the most effective use of resources allocated and to develop a control mechanism to assure effective implementation of the actions so that organizational objectives are achieved.
3.      Long term planning and Short term planning
               Short term planning
It involves deciding what your goals are for the short term (usually within the next year). These short term goals may include restructuring, hiring or short term profit targets.

Long Term Planning
It  may involve an outlook for the future (in the next 5 to 10 years). This may involve a capital funding goal or company expansion goals.
4.      Proactive planning and Reactive planning
Proactive planning
It involves designing suitable courses of action in anticipation of likely changes in the relevant environment. Use broad planning approaches, broad environmental scanning, reserve some resources to be used for the future.
They do not wait for environment to change, but take actions in advance of change.
Reliance industries and Hindustan Liver adopted this approach and their growth rate has been much faster than others.
Reactive planning
Organizations response comes after the environmental changes have taken place.
After changes takes place organization starts planning.
Organization looses opportunities to those who adopt proactive approach
5.      Formal and Informal Planning
               Formal Planning
               Well structured
               Large organizations create separate corporate planning cell with MBAs, Engineers etc
               Continuously monitor external environment.
               Informal planning
               Not well structured
               Smaller organizations , no separate cell, part of managers activities.
               No systematic evaluation of external environment.

planning

Planning

The process of setting goals, developing strategies, and outlining tasks and schedules to accomplish the goals.
Planning is the process of deciding in advance what is to be done, where, how and by whom it is to be done. Planning as a process involves anticipation of future course of events and deciding the best course of action. Thus, it is basically a process of ‘thinking before doing’.

Nature Of Planning

The nature of planning can be highlighted by studying its characteristics.

They are as follows:

a)     Planning is a mental activity(use ur mind)

Planning is not a simple process. It is an intellectual exercise and involves thinking and forethought (anticipate) on the part of the manager.

(b)Planning is goal-oriented

Every plan specifies the goals to be attained in the future and the steps necessary to reach them.

 A  manager cannot do any planning, unless the goals are known.

(c) Planning is forward looking

 It is futuristic in nature since it is performed to accomplish some objectives in future.

      (d) Planning pervade(sets up) all managerial activity

Planning is the basic function of managers at all levels.

(e) Planning is the primary function

Planning logically precedes the execution of all other managerial functions.

(f) Planning is based on facts

             It is based on objectives, facts(data) and considered forecasts. Thus planning is not a guess work.

(g)Planning is flexible

Planning is a dynamic process capable of adjustments in accordance with the needs and requirements of the situations. Thus planning has to be flexible and cannot be rigid.

(i)               Planning is essentially decision making

 Planning is a choice activity as the planning process involves finding the alternatives and the selection of the best. Thus decision making is the cardinal part of planning.

Significance of Planning

The importance and usefulness of planning can be understood with reference to the following benefits.

(a)Minimizes uncertainty.

The future is generally uncertain and things are likely to change with the passage of time.

Planning helps in minimizing the uncertainties of the future as it anticipates future events.

(b)Emphasis on objectives

The first step in planning is to fix the objectives. When the objectives are clearly fixed, the execution of plans will be facilitated towards these objectives.

(c)Promotes coordination.

 Planning helps to promote the coordinated effort on account of pre-determined goals.

(d)Facilitates control.

 Planning and control are inseparable in the sense that unplanned actions cannot be controlled. Control is nothing but making sure that activities conform to the plans.

(e)Improves competitive strength.

Planning enables an enterprise to discover new opportunities, which give it a competitive edge.

(f)Economical operation. Since planning involves a lot of mental exercise, it helps in proper utilization of resources and elimination of unnecessary activities. This, in turn, leads to economy (saving)in operation.

(g)Encourages innovation.

 Planning is basically the deciding function of management. Many new ideas come to the mind of a manager when he is planning. This creates an innovative and foresighted attitude among the managers.

(h)Tackling complexities of modern business.

With modern business becoming more and more complex, planning helps in getting a clear idea about what is to be done, when it is to be done, where it is to be done and how it is to be done.

stages of control and strategic and operational control

Stages of control
Feed forward, Concurrent control, Feedback control.

Management can implement controls before an activity commences, while the activity is going on, or after the activity has been completed. The first type is called feed forward control, the second is concurrent control, and the last is feedback control.
What is Feed forward Control?
The most desirable type of control feed forward control – prevents anticipated problems because it takes place in advance of the actual activity. Its future directed. An example of feed forward control is the scheduled aircraft maintenance programs done by the major airlines. These programs are designed to detect, and  prevent structural damage that might lead to an airline disaster.
The key to feed forward control, therefore is taking managerial action before problem occurs. Feed forward controls allow management to prevent problems rather than having to cure them later.
 Unfortunately these controls require timely and accurate information that is often difficult to develop. As a result managers frequently have to use one of the other two types of control.
When Is Concurrent control used?    
Concurrent Control: Control that takes place while an activity is in progress.
Concurrent control, as its name implies, takes place while an activity is in progress. When control is enacted while the work is being performed management can correct problems before they become too costly.
The best known form of concurrent control is direct supervision. When a manager directly oversees the actions of an employee, the manager can concurrently monitor the employee’s actions and correct problems as they occur.
MSOffice example
Why is feedback Control so popular?
Feedback control: Control that takes place after an action.
The most popular type of control relies on feedback. The control takes place after the action.
The major drawback of this type of control is that by the time the manager has the information the damage has already been done. For example, financial statements are an example of feedbacks controls. If, for instance the income statement shows that sales revenues are declining the decline has already occurred. So at this point, the manager’s only option is to try to determine why sales decreased and to correct the situation.
Feedback has two advantages over feed forward and concurrent control. First feedback providers managers with meaningful information on the effectiveness of their planning effort. Feedback that indicates little variance between standard and actual performance is evidence that planning was generally on target. If the deviation is great a manager can use that information to make new plans more effective. Second, feedback control can enhance employee’s motivation. People want information on how well they have performed. Feedback control provides that information.
Types of control
Strategy control and Operational control
1. Basic question
Strategic control- are we moving in right direction?
Operational control- how we are performing
2. Aim
Strategic control-Proactive
Operational control- allocation and use of organizational resources
3. Main concern
Strategic control- steering the future direction of organization
Operational control- action control
4. Focus
Strategic control- External environment
Operational control – Internal Organization
5. Time horizon
Strategic control- long term
Operational control – short term
6. Exercise of control
Strategic control- top management
Operational control – middle management
7. Main techniques
Strategic control- environmental scanning, information gathering, questioning and review
Operational control – budgets, schedule, MBO

control techniques

10 Types of Traditional Control Techniques

The ten types of traditional techniques of controlling are discussed below :-

1. Direct Supervision and Observation

'Direct Supervision and Observation' is the oldest technique of controlling. The supervisor himself observes the employees and their work. This brings him in direct contact with the workers. So, many problems are solved during supervision. The supervisor gets first hand information, and he has better understanding with the workers. This technique is most suitable for a small-sized business.



2. Financial Statements

All business organisations prepare Profit and Loss Account. It gives a summary of the income and expenses for a specified period. They also prepare Balance Sheet, which shows the financial position of the organisation at the end of the specified period. Financial statements are used to control the organisation. The figures of the current year can be compared with the previous year's figures. They can also be compared with the figures of other similar organisations.
Ratio analysis can be used to find out and analyse the financial statements. Ratio analysis helps to understand the profitability, liquidity and solvency position of the business.

3. Budgetary Control

A budget is a planning and controlling device. Budgetary control is a technique of managerial control through budgets. It is the essence of financial control. Budgetary control is done for all aspects of a business such as income, expenditure, production, capital and revenue. Budgetary control is done by the budget committee.

4. Break Even Analysis

Break Even Analysis or Break Even Point is the point of no profit, no loss. For e.g. When an organisation sells 50K cars it will break even. It means that, any sale below this point will cause losses and any sale above this point will earn profits. The Break-even analysis acts as a control device. It helps to find out the company's performance. So the company can take collective action to improve its performance in the future. Break-even analysis is a simple control tool.

5. Return on Investment (ROI)

Investment consists of fixed assets and working capital used in business. Profit on the investment is a reward for risk taking. If the ROI is high then the financial performance of a business is good and vice-versa.
ROI is a tool to improve financial performance. It helps the business to compare its present performance with that of previous years' performance. It helps to conduct inter-firm comparisons. It also shows the areas where corrective actions are needed.

6. Management by Objectives (MBO)

MBO facilitates planning and control. It must fulfill following requirements :-
Objectives for individuals are jointly fixed by the superior and the subordinate.
Periodic evaluation and regular feedback to evaluate individual performance.
Achievement of objectives brings rewards to individuals.
7. Management Audit

Management Audit is an evaluation of the management as a whole. It critically examines the full management process, i.e. planning, organising, directing, and controlling. It finds out the efficiency of the management. To check the efficiency of the management, the company's plans, objectives, policies, procedures, personnel relations and systems of control are examined very carefully. Management auditing is conducted by a team of experts. They collect data from past records, members of management, clients and employees. The data is analysed and conclusions are drawn about managerial performance and efficiency.

8. Management Information System (MIS)

In order to control the organisation properly the management needs accurate information. They need information about the internal working of the organisation and also about the external environment. Information is collected continuously to identify problems and find out solutions. MIS collects data, processes it and provides it to the managers. MIS may be manual or computerised. With MIS, managers can delegate authority to subordinates without losing control.

9. PERT and CPM Techniques

Programme Evaluation and Review Technique (PERT) and Critical Path Method (CPM) techniques were developed in USA in the late 50's. Any programme consists of various activities and sub-activities. Successful completion of any activity depends upon doing the work in a given sequence and in a given time.
CPM / PERT can be used to minimise the total time or the total cost required to perform the total operations.
Importance is given to identifying the critical activities. Critical activities are those which have to be completed on time otherwise the full project will be delayed.
So, in these techniques, the job is divided into various activities / sub-activities. From these activities, the critical activities are identified. More importance is given to completion of these critical activities. So, by controlling the time of the critical activities, the total time and cost of the job are minimised.

10. Self-Control

Self-Control means self-directed control. A person is given freedom to set his own targets, evaluate his own performance and take corrective measures as and when required. Self-control is especially required for top level managers because they do not like external control.
The subordinates must be encouraged to use self-control because it is not good for the superior to control each and everything. However, self-control does not mean no control by the superiors. The superiors must control the important activities of the subordinates.

Behavioral theories of organization

Behavioral theories of organization

What is Organizational Behavior?

 Specialized field of study concerned with understanding and analyzing the human behavior in organization

Model for organizational behavior

1.       Cognitive Frame work

2.       Behavouristic Framework

3.       Social learning framework

Cognitive approach

It emphasizes the positive aspects of human behavior and uses concepts such as expectancy, demand, and intention.  Cognition can be simply defined as the act of knowing an item of information.  In cognitive framework, cognitions precede behavior (goal directed behavior) and constitute input into the person’s thinking, perception, problem solving, and information processing.

It means that a person desires a goal and also knows the behavior that will lead to achievement of the goals.

Behavouristic Framework

Pavlov’s  Stimulus – Response( S-R ) model states that Stimulus elicit(bring out) response- Physical reflexes

Stimulus means external factor affecting you and it may change the response of human

Example: discount on a product (stimulus) may change the consumers buying habit(response)

B.F Skinner- Consequences to a response can explain most behavior than a eliciting stimuli.(R-S) .

Behavior is a function of consequences.

 Employees learn by observing the consequences of their actions.

Social learning framework

Behavior can be explained in terms of a continuous reciprocal interaction of cognitive, behavioral and environmental determinants.

Behavior is learned from environment through process of observation learning. Children observe people around them , behave in that way, influenced by parents, Television, friends, political and social environments.