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Post Graduate Diploma in Business Administration - Semester 1 MB0038 Management Process and Organizational Behaviour -4 Credits

Assignment Set -1 (60 marks) Q1. What are the fourteen principles of management?

Answer: The fourteen principles of management given by Henri Fayol, a mining engineer and manager by profession. This theory is also called the Administrative Theory. The principles of the theory are: 1. Division of work: tasks should be divided up with employees specializing in a limited set

of tasks so that expertise is developed and productivity increased. 2. Authority and responsibility: authority is the right to give orders and entails enforcing

them with rewards and penalties; authority should be matched with corresponding responsibility. 3. Discipline: this is essential for the smooth running of business and is dependent on good

leadership, clear and fair arguments, and the judicious application of penalties. 4. Unity of command: for any action whatsoever, an employee should receive orders from

one superior only; otherwise authority, discipline, order, and stability are threatened. 5. Unity of direction: a group of activities concerned with a single objective should be co-

coordinated by a single plan under one head. 6. Subordination of individual interest to general interest: individual or group goals must not

be allowed to override those of the business. 7. Remuneration of personnel: this may be achieved by various methods but it should be

fair, encourage effort, and not lead to overpayment. 8. Centralization: the extent to which orders should be issued only from the top of the

organization is a problem which should take into account its characteristics, such as size and the capabilities of the personnel. 9. Scalar chain (line of authority): communications should normally flow up and down the

line of authority running from the top to the bottom of the organization, but sideways communication between those of equivalent rank in different departments can be desirable so long as superiors are kept informed. 10. Order: both materials and personnel must always be in their proper place; people must


Q2. Explain strategy as an organisational process.

Answer: Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. In order to determine the direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue a particular course of action. Generally, strategic planning deals with at least one of three key questions: "What do we do?" "For whom do we do it?" "How do we excel?"

In many organizations, this is viewed as a process for determining where an organization is going over the next year ormore typically3 to 5 years (long term), although some extend their vision to 20 years.

The key components of 'strategic planning' include an understanding of the firm's vision, mission, values and strategies. (Often a "Vision Statement" and a "Mission Statement" may encapsulate the vision and mission).

Vision: outlines what the organization wants to be, or how it wants the world in which it operates to be (an "idealised" view of the world). It is a long-term view and concentrates on the future. It can be emotive and is a source of inspiration. For example, a charity working with the poor might have a vision statement which reads "A World without Poverty."

Mission: Defines the fundamental purpose of an organization or an enterprise, succinctly describing why it exists and what it does to achieve its vision. For example, the charity above might have a mission statement as "providing jobs for the homeless and unemployed".

Values: Beliefs that are shared among the stakeholders of an organization. Values drive an organization's culture[citation needed] and priorities and provide a framework in which decisions are made. For example, "Knowledge and skills are the keys to success" or "give a man bread