Study Questions for Midterm I
1) What is business environment? Who are the actors and their implications on organizations?
The combination of internal and external factors that influence a company's operating situation and
managers’ decisions. The business environment can include factors such as: clients and suppliers; its
competition and owners; improvements in technology; laws and government activities; and market,
social and economic trends.
2) Why strategic management is important?
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Proactive in shaping firm’s future & initiate and
influence firm’s activities
Formulate better, systematic, logical, rational
strategies
Improvement in sales, profitability & productivity
Effective allocation of time & resources
Internal communication among personnel
Improved understanding of competitors strategies
Enhanced awareness of threats
Enhanced problem-prevention capabilities
Integration of individual behaviors
Clarify individual responsibilities
Encourage forward thinking
Goal of strategic management is to create above-average
returns for investors.
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Returns exceeding those for alternative opportunities
at equivalent risk.
o Earning above-average returns depends in part on the
organization’s competitive environment.
Most business owners want to make wise decisions, but they
sometimes are at a loss of where to begin. This is where
strategic management comes into play. An important
concept for business owners and managers to grasp,
strategic management entails evaluating business goals,
objectives and plans in light of your company focus on
effectiveness and efficiency.
3) Why scanning is important and essential part of strategic management?
To know your position in the environment, To respond effectively to constant change, To see the
organization as a whole, To avoid surprises, To survive, To lay the foundation for strategic issues
4) How would you evaluate industry competition?
Porter’s five forces model is an analysis tool that uses five forces to determine the profitability of an
industry and shape a firm’s competitive strategy” The analysis includes:
o New entrance – threat of potential new competitors
o Customers – Bargaining power of buyers
o Suppliers – Bargaining power of suppliers
o Substitute products – threat of substitute products or services
o Industry competition – Rivalry among competing firms
5) How would you evaluate organizational environment?
Examining the general environment involves understanding of key factors and trends in broader
society. PESTEL analysis is associated with six dimensions: Political, Economic, Social,
Technological, Environmental, And Legal.
We can also use SWOT analysis, which is looking at company’s Strengths, Weaknesses,
Opportunities and Threads.
6)
What are current issues in strategy implementation?
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Strategic planning failures that hinder strategy implementation:
Failures of substance: Inadequate attention to major strategic planning elements
Failures of process: Poor handling of strategy implementation, Lack of participation error, Goal
displacement error
Corporate governance: System of control and performance monitoring of top management.
Strategic leadership: The capability to inspire people to engage in a process of continuous change,
performance and implementation strategies.
7) How organizations go
global?
o Global Sourcing
o Exporting and
importing
o Licensing
o Franchising
o Strategic Alliance;
Joint Venture
o Foreign Subsidiary
8) If you would like to call a project as a social responsibility, what characteristics would you look for? In other
words, when do we call anything as a social responsibility?
From the classic view, management’s only social responsibility is to maximize profits by operating the
business in the best interest of the stockholders, however According to socioeconomic view, organization’s SR goes
beyond just earning returns, because it must include protecting and improving society’s welfare. Socioeconomic is
more common nowadays.
9) What do managers do in term of functions, roles and skills?
Managers’ functions:
1. Planning – defining goals, establishing strategies, and developing plans to coordinate activities.
2. Organizing - determining what tasks are to be done, who is to do them, how the tasks are to be
grouped, who reports to whom and where decisions are to be made.
3. Controlling - monitoring activities to ensure that they are being accomplished as planned and
correcting any significant deviations.
4. Leading – motivating employees, directing others, selecting the most effective communication
channels and resolving conflicts.
Managers’ roles:
1. Interpersonal:
o Figurehead – symbolic head; require to perform a number of routine duties of a legal or social
nature
o Leader – responsible for the motivation and direction of employees
o Liaison – Maintains a network of outside contacts who provide favors and information
2. Informational:
o Monitor – receives a wide variety of information; serves as a center of internal and external
information of the organization
o Disseminator – transmits the information received from outsiders or from other employees to
members of the organization
o Spokesperson – transmits information to outsiders on organization’s plans, policies, actions,
and results; serves as expert on organization’s industry
3. Decisional
o Entrepreneur – searches organization and its environment for opportunities and initiates
projects to bring about change
o Disturbance handler – responsible for corrective actions, when the organization is facing
important, unexpected disturbances
o Resource allocator – makes or approves significant organizational decisions
o Negotiator – responsible for representing the organization at major negotiations
Management skills:
1. Technical skills – the ability to apply specialized knowledge or expertise
2. Human skills – the ability to work with, understand and motivate other people, both individually and in
groups
3. Conceptual skills – The mental ability to analyze and diagnose complex situations
10) What are the challenges and opportunities for managers in 21st century?
Challenges:
 Globalization (increased foreign assignments, working with people from different cultures,
movement of jobs to countries with low-cost labor)
 Managing workforce diversity – adapting to people who are different
 Improving quality and productivity
 Improving customer service
 Improving people skills
 Stimulating innovation and change – must foster innovation and master the art of change
 Coping with temporariness
 Working in networked organizations – technology changes allow people to communicate and
work together even though they may be thousand miles apart
 Helping employees balance work-life conflicts
 Creating a positive work environment
 Improving ethical behavior
11) Why do we think organizations as open system?
Open system: Dynamically interact to their environments by taking in inputs and transforming them into
outputs that are distributed into their environments. Open systems continuously exchange feedback with their
environments, analyze that feedback, adjust internal systems as needed to achieve the system’s goals, and
then transmit necessary information back out to the environment.
12) Why do we assume there is no one best way to manage an organization? Please refer the ‘Contingency
Theory’
Contingency theory assumes that there is no one best way to manage an organization, because of
1. Organization Size
Organizations of different sizes have different problems of coordination
2. Routineness of task technology
Routine technologies require organizational structures, leadership styles, and control systems
that differ from those required by customized or non-routine technologies.
3. Environmental uncertainty
What works best at stable environment may be inappropriate in a rapidly changing and
unpredictable environment
4. Individual Differences
Individuals differ in their desire for growth, autonomy, expectations, etc.
13) What are the changes in manager’s job in today’s business world?
1. Changing Technology
o Shifting organizational boundaries
o Virtual workplaces
o More flexible workforce
o Flexible work arrangements
o Empowered Employees
2. Increased Security Threats
o Risk management
o Work/life balance
o Restructured workplace
o Discrimination concerns
o Globalization concerns
o Employee assistance
3. Increased emphasis on organization and managerial ethics
o Redefined values
o Rebuilding trust
o Increased accountability (responsibility)
4. Increased competitiveness
o Customer service
o Innovation
o Globalization
o Efficiency/productivity
14) Why is learning important for managers?
Key point: Goal of strategic management is to create above-average returns for investors.
Also, strategic management is a process by which the guiding members of an organization envision its future
and develop the necessary procedures and operations to achieve that future… Who does all the work?
Obviously, Managers…
(Goodstein, Nolan, and Pfeiffer, 1992)
supportive point: The strategic-management process is based on the belief that organizations should
continually monitor internal and external events and trends so that timely changes can be made as needed.
Therefore, after examining given circumstances managers have to make correct decision on timely manner in
order to solve any difficulty that organization face. Therefore, studying and learning is crucial for any
manager. Especially, managers must make changes with respect to technologies as it evolves rapidly!
15) How do managers shape their employees’ behavior?
One of the main purposes of providing rewards to employees is to shape their behavior. The key to ensuring
that rewards have the most impact on shaping the employee’s behavior is knowing what behavior to reward,
when to reward it and how to reward it. Rewards that are contingent upon certain behavior are critical in
shaping future behavior.
Managers can shape employee’s behavior in 4 ways [2]:
1. Positive reinforcement
Positive reinforcement is the process of strengthening a behavior (increasing its frequency) by contingently
presenting something pleasurable. An example of this is an employee who works overtime due to praise and
recognition from the CEO.
2. Negative reinforcement
Negative reinforcement is the process of strengthening a behavior (increasing its frequency) by contingently
removing something displeasing. An example of this is a manager who stops yelling at an employee when
they make a successful sale.
3. Positive punishment
Positive punishment is the process of weakening a behavior (decreasing its frequency) by contingently
presenting something displeasing. An example of this is asking an employee to re-write a blog post that was
submitted with an error.
4. Negative punishment
Negative punishment is the process of weakening a behavior (decreasing its frequency) by contingently
removing something pleasing. An example of this is suspending a problem employee without pay.
16) What are the major attitudes? Which one would you choose and focus?
Job Satisfaction - A positive feeling about one’s job resulting from an evaluation of its characteristics.
Job Involvement - The degree to which a person identifies with a job, actively participates in it, and considers
performance important to self-worth.
Psychological Empowerment - Employees’ belief in the degree to which they affect their work environment,
their competence, the meaningfulness of their job, and their perceived autonomy in their work.
Organizational Commitment - The degree to which an employee identifies with a particular organization and
its goals and wishes to maintain membership in the organization.
Perceived Organizational Support - The degree to which employees believe an organization values their
contribution and cares about their well-being.
Employee Engagement - An individual’s involvement with, satisfaction with, and enthusiasm for the work he
or she does.
Job Satisfaction
17) What are the factors that negatively affect job satisfaction?
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On the job stress
Low salary
Promotion
Work
Security
Supervisor
Coworkers
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1) Fear of losing the job
2) Mundane routine
3) Feeling undervalued
4) Lack of opportunities
5) Rifts with supervisor
6) Feeling like a failure
7) Low pay scale
18) what can managers do to increase satisfaction level of their employees?
7 Ways To Keep Your Employees Happy (And Working Really Hard)
By Forbes
Build Ownership Among Your Crew: Get employees to feel that they own it.
Trust Employees To Leave Their Comfort Zones: Give new responsibilities.
Keep Your Team Informed: Strengthens the feeling among workers that they are an important part of the
organization.
Your Employees Are Adults—Treat Them Like It: The rumors are typically worse than reality.
You’re The Boss. You May Have To Act Like It Sometimes (but be consistent): Ideally they have an
open relationship but not to pretend you’re peer…
Money Matters (But Not As Much As You Think): Compensation packages are a big deal at the beginning
then—the challenge of the work, the purpose of the work, the opportunity to learn, the opportunity to
contribute.
Perks Matter (But Not As Much As You Think): They are great but not a substitute for prime sources of
professional inspiration.
19) What are the impacts of emotions at work? Why are they relevant to us as a manager? In other words,
emotions and OB applications?
Selection: Emotions should be considered when making hiring decisions
Decision Making: Emotions greatly influence our decision making.
Creativity: People in good moods tend to be more creative and open minded
Motivation
Leadership:
Negotiation
Job attitudes
Customer Service
Workplace behaviors
Safety and injury at work
Emotions impact work performance. It is important for managers to have high emotional intelligence
(EQ). High EQ means that the manager has empathy and can empathize with the worker’s
emotional state. This can lead the manager to make better decisions regarding the treatment of a
worker who has a disturbed emotional behavior. The manager must be able to manage his/her own
emotions and be aware of the impact of her/his own emotions. It takes social awareness and social
skills to detect the emotions of other people and manipulate them in a way that fits the
organization’s goals.
Refer to the graph about self-awareness, social awareness , social skills and self-management
20) How do the big five traits, MBTI and other personality traits relevant to OB? (Choose only 5 traits
among all)
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Myers-Briggs type indicator. 100 question personality test that divides people into one of the 16 personality
types…
Big five personality traits:
Extraversion. The extraversion dimension captures our comfort level with relationships. Extraverts tend to be
gregarious, assertive, and sociable. Introverts tend to be reserved, timid, and quiet.
● Agreeableness. The agreeableness dimension refers to an individual’s propensity to defer to others. Highly
agreeable people are cooperative, warm, and trusting. People who score low on agreeableness are cold,
disagreeable, and antagonistic.
● Conscientiousness. The conscientiousness dimension is a measure of reliability. A highly conscientious
person is responsible, organized, dependable, and persistent. Those who score low on this dimension are
easily distracted, disorganized, and unreliable.
● Emotional stability. The emotional stability dimension—often labeled by its converse, neuroticism—taps a
person’s ability to withstand stress. People with positive emotional stability tend to be calm, self-confident,
and secure. Those with high negative scores tend to be nervous, anxious, depressed, and insecure.
● Openness to experience. The openness to experience dimension addresses range of interests and
fascination with novelty. Extremely open people are creative, curious, and artistically sensitive. Those at the
other end of the category are conventional and find comfort in the familiar.
21) What is the link between individual’s personality and values to the workplace?
Key point: Personality can be thought of as the sum total of ways in which an individual reacts to and interacts with
others. It is most often described in terms of measurable traits that a person exhibits.
Supporting point: Values represent basic, enduring convictions that “a specific mode of conduct or end-state of
existence is personally or socially preferable to an opposite or converse mode of conduct or end-state of existence.”
According to John Holland’s fit theory, Ind.Per and their behavior and value towards works place should
“fit”. Moreover, the link between those two is that they are required to fulfill one another in other
words, match with each other.
Basically, how well they will fit in and work. By matching the right personality with the right company
you can achieve a better synergy and avoid pitfalls such as high turnover and low job satisfaction.
. Employees’ performance and satisfaction are likely to be higher if their values fit well with the organization
22) What are the factors that influence perception?
1. Selective Perception: People selectively interpret what they see on the basis of their interests,
background, experience, and attitudes.
2. Halo Effect: Drawing a general impression about an individual on the basis of a single characteristic
3. Contrast Effects: Evaluation of a person’s characteristics that are affected by comparisons with other
people recently encountered who rank higher or lower on the same characteristics
4. Projection: Attributing one’s own characteristics to other people
5. Stereotyping: Judging someone on the basis of one’s perception of the group to which that person
belongs
23) What is the link between individual thinking and perception?
Problem: A perceived discrepancy between the current state of affairs and a desired. Decisions: Choices
made from among alternatives developed from data perceived as relevant. Bias => Perception of the decision
Maker => Outcomes.
Perception is result of individual thinking, I would say hence one can perceive something and make a
conclusion after their own individual thought and assumptions.
24) What are the influences of individual differences, organizational constraints and culture on decision making?
1) Organizational Constraints on Decision Makers:
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Performance Evaluation
Evaluation criteria influence the choice of actions
Reward Systems
Decision makers make action choices that are favored by the organization
Formal Regulations
Organizational rules and policies limit the alternative choices of decision makers
System-imposed Time Constraints
Organizations require decisions by specific deadlines
Historical Precedents
Past decisions influence current decisions
Cultural Differences in Decision making:
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Problems selected
Time orientation
Importance of logic and rationality
Belief in the ability of people to solve problems
Preference for collective decision making
Individual Differences (Biases):
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Overconfidence Bias: Believing too much in our own ability to make good decisions
Anchoring Bias: Using early, first received information as the basis for making subsequent judgments
Confirmation Bias: Using only the facts that support our decision
Availability Bias: Using information that is most readily at hand, Recent, Vivid
Representative Bias: “Mixing apples with oranges”
Winner’s Curse: Highest bidder pays too much
Escalation of Commitment: In spite of new negative information, commitment actually increases
Randomness Error: Creating meaning out of random events
Hindsight Bias: Looking back, once the outcome has occurred, and believing that you accurately predicted
the outcome of an event
25) If you were planning a motivational model for human resource managers, how would you design it?
According to the video we have watched in class, it is not good to reward the best performer, when
the current job or the given task gets more sophisticated, therefore, I would encourage manager to
concentrate more on giving purpose, increasing autonomy, developing mastery of the employees…
bla bla
26) According to your perspective, what are the ‘must’ theories that you would use in your motivation models in
any given organization?
Goal-setting theory: the theory that set specific and difficult goals, with feedback, lead to higher
performance.
Self-Efficacy Theory: An individual’s belief that he or she is capable of performing a task. Higher efficacy is
related to: Greater confidence, Greater persistence in the face of difficulties, better response to negative
feedback (work harder)
Equity theory: Individuals compare their job inputs and outcomes with those of others and then respond to
eliminate any inequities.
Expectancy theory: the strength of a tendency to act in a certain way depends on the strength of an
expectation that the act will be followed by a given outcome and on attractiveness of that outcome to the
individual.