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Details and dates of our next event will be published here and in Velocity, our student e-magazine.
Below are questions and answers relating to paper P5 Integrated Management from past events.
Question
What is the the difference between mentoring, training and coaching and how they can be linked up to make an employee work effectively and efficiently?Answer
Training differs from coaching and mentoring in that there is a specific outcome, a skill, in mind. You train someone to do something specific and you can measure whether they can do it or not at the end of the training. It is skill development. Clearly having the right skills is essential to improving effective and efficient working.Coaching and mentoring are very similar and if they differ at all it is in the fact that coaching may be from someone who has not done the person's role (like a life coach) wheras mentoring is from someone who has. Both change behaviour but in a way that is broader than just skills, in fact they affect attitudes and beliefs. They are supposed to be motivational.
Question
Can you please explain the Management Style Theory (Leadership Theories) of Tannanbaum and Schmidth?
Answer
Firstly let's clear up the difference between Management and Leadership style.
A manager who rules by memo and bureacracy is hardly showing leadership because they are not meeting their subordinates. So leadership is interpersonal whereas management may be impersonal.
Tannanbaum and Schmidth discuss Leadership Style. They held interviews with lots of subordinates and asked about how decisions were taken and control exercised. They concluded that bosses seemed to have different styles ranging from Dictatorial (they take all decisions themselves and issue orders that cannot be questioned), Autocratic (take decisions but will attempt to explain the reasons to any who ask - they may hold discussions too but they won't seriously take on board the comments of others), Democratic (sometimes particpative or consultative - they will chair a meeting and summarise the view of those there and take the decision that suits the majority) and Lassiez Faire (tends to leave it up to subordinates to make the decisions).
Tannanbaum and Schmidth suggested these four broad styles might exist and a pair called Hunyeger and Heckman developed questionnaires to establish whether they could be measured. They could.
Later theorists started discussing which style was the best (ideal style - eg. Likert, McGregor) or under which conditions each would be best (contingency theory - eg. Fiedler, Handy)
Question
Please explain clan control and the difference between Bounded rationality and Rational Model (Planned Strategies)?Answer
Clan control was identified by William Ouchi. He meant the kind of control that is exercised by people's wish to remain part of the group and not to stand out and lose friends and respect. He wanted to argue that individuals are not selfish economic agents who need constant administrative controls or economic incentives (or punishments) to make them behave and work.Bounded rationality is the fact that, even if rational, managers can only take decisions within the bounds of their understanding at the time. Therefore the rational model's assumption that whole organisations are rational is faulty because organisations cannot know everything and often individual managers make bad decisions because of this.
Question
What does SMART mean?
Answer
SMART is a mnemonic for setting objectives. The precise meanings can vary.
In setting business strategy it usually means:
Specific
Measurable
Attainable
Relevant
Time Bound
But the 'A' can sometimes be turned to 'Agreed' if the mnomonic is used in HR applications (say budget targets or staff development goals) to reflect the need to obtain commitment by those affected. I have seen the R turned into 'resourced' which is also usually in a budgetary control context.
Question
Can you please explain the meaning of a Virtual Organisation, and give an example?
Answer
Virtual organisations are also sometimes called Network organisations.
They refer to organisations that have, in some parts at least, shifted away from conventional structures and ownership/employment patterns in favour of reliance of looser networks.
- outsourced aspects of production and service
- contract staff rather than employees
- homeworking by self-employed consultants
The reliance on electronic networks for some of this has led to the 'virtual' tag being applied.
Examples would be health care (consultants on line to hospitals often), management and IT consultancies
Question
How do I distinguish between strategic controls, tactical controls and operational controls? Please explain with examples. Why are controls important for an organisation?
Answer
This is a huge question and you will really need to read up on this. But briefly: Controls are important because they are how the management of an organisation ensure that the things they want to happen really do happen. They can do this through two mechanisms
- feedback: measure outcomes and detect when things are not going right (for example, budget variance, quality sampling, attendance checks on staff)
- feedforward: take steps to change later behaviour (for example, set a budget, improve the training of production staff, recruit motivated and reliable people).
Strategic controls influence the long term development and success of the business and will predominantly focus on the fit between the organisation and its environment. Examples are having a strategy, monitoring competitor behaviour, forecasting the boom and bust of the economic cycle.
Tactical (or more properly called 'managerial') controls are the controls the organisation puts on the behavour of the managers of its business units. This will include setting budgets, selection and training, balanced scorecards, management appraisals, managerial bonus payments.
Operational controls look after the ground floor activities of the firm such as the making of the product and the serving of the customer. They include having standard operating procedures, job training, attendance monitoring of staff, mystery shopping and face to face management techniques.
Control isn't only about measurement but, as a mangagement accountant, obviously the ones you will advise on will be mainly measurement. But P5 is Intergrated Management so its a lot more than just management accounting.
Question
Why have network organisations become so important in recent years?
Answer
Network organisations are probably the latest management fad. Reasons for their popularity include:
- Need to increase organisational flexibility to cope with uncertainty
- Network organisations allow ad hoc pooling of specific expertise and also have lower fixed costs due to contractors and outsourcing.
- Improvements in IT/IS enabling co-ordination of activities at remote locations such as supply chains, virtual workers and outsourcing
- Improvements in drafting of partner contracts which allow more flexibility.
Question
I would like to know the difference between strategic and tactical controls and how they are applied in an organisation?
Answer
Strategic controls are likely to concern the long term development of the business and in particular how it copes with its environment. Examples would be having a strategic plan (or planning system), mechanisms for environmental scanning, methods of controlling relations with external bodies such as legislature, pressure groups, key customers and competitors. Often PR does this. Tactical controls are set up at divisional level and are concerned with ensuring that the business unit doesn't run excessive risks in carrying out the directives of the corporate centre. These controls will include the HRM systems, performance approaisal and the requirements that budgets be maintained, internal audit. In a sense they are the General Controls (e.g. OAPSPASM or SOAPSPAM mnemonic).
Question
How does a Holding company work and how is it different from a Functional company?
Answer
Holding companies are one legal form for a 'divisionalised company' - i.e. a firm that has semi-autonomous mini-businesses within it. A functional structure is a single business unit that has been organised on the basis of groups of people all doing one set of tasks (e.g. finance, sales, production) A divisision may be partially arranged on functional lines.
Question
Please tell me the best approch to tackle a question on strategy mixed with culture. How do i effectively mix information from a given scenario with theory and practical examples? Should the answers be to the point or lengthy? Is there a standard minimum number of words that i should write for a 10 mark answer?
Answer
Firstly there is no 'standard minimum' words for 10 marks. A lot of rubbish will get less marks than a little bit of sense.
I'm not sure what question you have in mind that might mix strategy with culture. In my view culture intersects with strategy in three ways:
- firstly culture will affect approach to strategy. A small firm or an opportunistic cuture is less likley to adopt a formal 'rational' approach than a large firm
- secondly culture affects strategic outlook. Miles and Snow talk about four classes of strategic culture: defenders, reactors, analysers and prospectors. This will also affect the orientations of management to strategic issues.
- finally culture can affect the way a firm perceives of its environment and hence its ability to respond effectively. An inward-looking and arrogany culture is a strategic weakness, and ethnocentric culture will harm a firm's abilty to operate globally.
Your third question is a good technique issue. I teach my students to 'identify', 'justify' and 'specify'.
- identify the problem in the scenario and the piece of theory that sheds light on it
- justify why you beleive this to be suitable for analysis by the theoretical perspective you're using
- specify the course of action management should take and why this is a good idea.
Try using this model in answering practice questions. You'll see it does work well.
Question
What is the best answer to a question about resource based strategy versus positioning strategy?
Answer
The best answer depends on the question ofcourse.
The best approach to a general question is to outline the key differences between the two perspectives (they are not 'strategies' but rather academic views on the source of superior competitive performance) and to make the point that no-one disagrees with the positioning view in the short run. Obviously its essential that the firm must make a product that suits customer needs and to have a superior cost or differentiation position compared to rivals.
Where the RBT perspective comes in is where we discuss long-run success. Particular products and market positions only last a limited time and apply only to particular markets or industries. Long-run successful firms like General Electric and Honda (not so much Sony anymore) seem to outlive the life cycle of particular markets and make high profits over many decades due to skillful exploitation of a distinctive competence. In the case of GE its innovative management based on ints management development competence whilst with Honda its engine technology.
