Management and Organisations in a Global Environment - Assignment Example

Management and Organisations in a Global Environment Question The three approaches on which managerial decision making can be based, as these approaches were reviewed in class, are: a) Rationality, b) Bounded Rationality and c) Intuition. The above approaches could be analyzed further as follows: a) Rationality is based on the view that managerial decisions are consistent; in the context of this approach, managerial decisions are considered as rational. The Rational approach of decision-making approach emphasizes on the importance of identifying primarily the problem and the decision criteria; then weights are allocated to criteria and alternatives are identifying and established, as indicated in the diagram presented below. The Rational Approach, which seems to be favoured by Prof Randall, is based on the assumption that the problem and the preferences are clear and that there are no constraints in establishing alternatives; b) The Bounded Rationality is based on similar process with the Rational Approach, with the following exception: In the context of Bounded Rationality, the performance of the decision-making process is related to the ability of the individual ‘to process information’ (Lecture Notes, Slide 5, p.3); c) Intuition is based on the experience of the individual in regard to the issue involved; at the same time, the cognitive skills of individual can affect the decision making process when it is based on Intuition. Graph 1 – Rational Decision – making process (Source: Lecture notes) Question 2 The introduction of a carbon tax in Australia would affect a variety of groups, including: a) local population; since carbon tax will be incorporated in the taxes paid by vehicle – users it is expected that the cost of using a vehicle in Australia will be increased. This fact will negatively affect the financial status of vehicle – users across Australia, b) entrepreneurs; the carbon tax will increase the operational costs of businesses in all industries, c) foreign investors; the introduction of a new tax would possibly keep away foreign investors that would be interested in investing in Australia; d) economy; the new tax would decrease the average income of people in Australia, leading to the decrease of GDP, even in the long term; e) government; the new tax would harm the image of the country’s government, leading to the decrease of the population’s trust to the governmental decisions. The Multi-Advocacy process could have been used for developing such a decision in the following way: the specific process is based on the idea that any decision made is based on an extensive bargaining process (Mintz and DeRouen 48). In fact, according to this model, ‘no decision is made before the leader examines the views of all agencies participated in the bargaining process’ (Mintz and DeRouen 48). In the above case, the government of Australia could have asked the representatives of various social and economic groups, meaning especially the representatives of labour and trade unions, so that a decision is developed taking into consideration the interests of all stakeholders. Question 3 The Multivariate Analysis is based on the simultaneous use of many variables, at least three, for taking a decision (Nargundkar 119). The above method of data analysis is particularly valuable when it is aimed to develop a decision using a range of variables, so that the accuracy of decision is increased. For example, when hiring a new IT Technology Managers at Holmes Institute, the following variables would be used for developing a decisions, as these variables will be part of the Multivariate Analysis: ‘gender, age, years of experience and level of education’ (Nargundkar 119). Other examples where the Multivariate Analysis would be used are the following ones: a) when having to decide on the relocation of a firm’s unit, the views of employees should be reviewed using the following variables: years in the organization, home distance from the new region of the firm’s unit, average daily expensed for traveling to work and so on, b) when having to decide the expansion of the firm abroad, the following variables should be reviewed: legal costs of establishing a unit abroad, costs of hiring employees, cost of training employees, time required for the plan to be completed, profit expected within the first 2 years of operation (even at an average level, and so on). Question 4 The Multivariate Analysis can be used for analyzing a high range of data. Still, there are certain factors that cannot be processed by the particular process. An example is provided in the study of Nargundkar (2008). According to the above researcher, the Multivariate Analysis cannot be used when ‘the variables are nominally scaled’ (Nargundkar 119); for example, when describing the variables using words, such as ‘age, gender and so on’ (Nargundkar 120). Moreover, it should be noted that the Multivariate Analysis couldn’t be used for ‘ordinal level data’ (Nargundkar 120). In the case under examination, i.e. when the analysis is involved in the process of data related to five applicants only, ‘an average cannot be produced’ (Nargundkar 120). Another problem of the Multivariate Analysis seems to be the following one: ‘unknown factors, i.e. apart from the predicted ones, cannot be excluded’ (Gorsuch 148); these, unknown factors may also affect the result of the Multivariate Analysis without being incorporated in the list of factors on which the Analysis is based. Question 5 In the context of strategic decision-making, a manager needs to employ a wide range of techniques in order to reach a decision, especially when the specific decision is critical for the organization (Daft and Lane 2009). Deciding on the salary of employees can be a challenging task for managers since the relevant decision can highly affect employee performance, as the latter is related to the organizational performance (Daft and Marcic 2012). In fact, it seems that, under certain terms, the use of simple policies, such as the rule of thumb for developing important management decisions can lead to severe organizational turbulences (Hill and Jones 2012). More specifically, using a rule of thumb a manager can take a decision based on the personal views of individuals who, most commonly, have no idea of the organizational environment. As a result, these views reflect the personal experiences of people and cannot have a critical role in the decision – making process. Still, it seems that a manager can be highly influenced by his environment in regard to the decision – making process, especially when the rule of thumb is used as a tool for making a critical organizational decision. Having in mind the advice given, a manager can be influenced as to his own decision, a fact that leads to bias in the decision taken; such problem can exist in regard to all decisions involved in organizational operations, including the decisions about the salary. Question 6 Kurt Lewin’s ‘Calm Waters’ Metaphor is differentiated from the White-Water Rapids Metaphor. More specifically, the Calm Waters Metaphor is based on the idea that change can be initiated by using the following process: ‘a) unfreezing the status quo, b) introducing change, c) re-freezing the status quo so that change is made permanent’ (Rama 2010). In other words, the Calm Waters Metaphor promotes the idea that change can be introduced in a non-turbulent environment and can be established without affecting the environment’s status. The above Metaphor has been replaced today by the White-Water Rapids Metaphor, which is based on the idea that ‘environments tend to be uncertain and dynamic’ (Rama 2010). In this context, change can be introduced anytime, with no prior warning, and can highly affect the environment’s status. In the case under examination the first Metaphor seems to be more relevant; public servants in the specific Service would have no reason in expecting that their work environment would be ‘instable and unpredictable’ (Rama 2010), especially since the specific service is part of the public sector where work environment tends to be predictable, as in most countries worldwide. Moreover, change, as it was introduced seemed to follow the sequence of processes as included in the Calm Waters Metaphor: the Government ordered the relocation of public services without announcing any further change, as for instance in regard to the schedule of work or the number of employees. The change was considered as a necessary decision, which would have to be taken without causing severe oppositions, a target that was not achieved. Question 7 The Force-field Analysis theory of Lewin is based on the view that ‘social processes are highly influenced by certain factors, which are called forces’ (Praszkier and Nowak 52). These forces, as usually followed by counterforces, need to be taken into consideration before ‘taking decisions that are related to various social situations’ (Praszkier and Nowak 52). From a similar point of view, Lukenbill and Froling (83) note that the Lewin Force-Field Analysis Theory reflects the need for ‘equilibrium between positive forces and negative forces’ (Lukenbill and Froling 83). It is explained that such forces are likely to exist in all social activities (Lukenbill and Froling 83). When planning change, leaders need to identify those forces that are likely to support change and those that would be opposed to change (Lukenbill and Froling 83). In the case under examination, the Lewin’s Force Field Analysis would be used for developing a diagram so that positive and negative forces are reflected; then, it could be checked whether positive forces are stronger than negative forces. If the answer is positive, then the particular project should proceed. In case of a negative answer, the project should be abandoned. As made clear through the Graph 2 below, the negative forces are stronger than the positive ones, a fact indicating the need for abandoning the specific policy. 1 2 3 4 5 6 Positive forces 1: Public services would be closer to people in country; increase of country’s income by the relocation of public services 2: It would be easier for people in country to visit the offices of the specific Public Service Negative forces 1: For public servants: Increased costs for traveling to Dubbo 2: For public servants: need for moving to Dubbo/ family issues such as work of the husband/ wife and child arrangements in regard to daily care and school attendance. 3: For the state: Increased employee dissatisfaction; potential decrease of employee performance 4: For the state: Not all public servants have a car; expected delays in arriving at work Graph 2 – Lewin’s Force Field Analysis as related to the proposed plan Works Cited Daft, Richard, and Lane, Patricia. Management. Belmont: Cengage Learning, 2009. Daft, Richard, and Marcic, Dorothy. Understanding Management. Belmont: Cengage Learning, 2012. Gorsuch, Richard. Factor Analysis. London: Routledge, 1983. Hill, Charles, and Jones, Gareth. Strategic Management: An Integrated Approach. Belmont: Cengage Learning, 2012. Mintz, Alex, and DeRouen, Karl. Understanding Foreign Policy Decision Making. Cambridge: Cambridge University Press, 2010. Nargundkar, Rajendra. Marketing Research: Text And Cases. New Delhi: Tata McGraw-Hill Education, 2008. Praszkier, Ryszard, and Nowak, Andrzej. Social Entrepreneurship: Theory and Practice. Cambridge: Cambridge University Press, 2011. Rama, Rao. “What is the Calm Waters Metaphor?” March 4, 2010. CiteMan Network. Accessed at 25 June 2012. http://www.citeman.com/9053-what-is-the-calm-waters-metaphor.html Read More