bmom5203 - assignment _pt 1_

Name: Mohd. Norizam Md. Salleh Student ID:CGS00534317

I/C No: 670703-01-6045 Part 1: of 15

BMOM 5203

ASSIGNMENT

PART 1

PART 1: INDIVIDUAL ASSIGNMENT (25%)

INSTRUCTIONS

1. Please answer the questions in not less than 5,000 words in total.

2. The answer sheet should include cover page, table of contents, references, and appendix (if necessary).

3. The answers should be deliberate, precise, elaborative, original and inclusive of real business issues with examples.

4. Answer all the questions.


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Question 1 In a short essay, describe the three main types of managerial skills identified by Robert Katz. Which skills are most important to each level of management, and why? [6 marks]

Answer 1

The three main types of managerial skills as identified by Robert L. Katz are

technical skills, human skills followed by conceptual skills. Different skills are

applicable to different levels of management which are top, middle and operational

management in order to achieve successful management performance.

Technical skills require one to fully utilize their specialized knowledge and expertise

to work related techniques and procedures (Certo & Certo, 2009). It refers to the

proficiency in a certain specialized field such as accounting, computers

programming, engineering and manufacturing. Most of the times, it is actually

working with “things” such as processes or physical objects.

Basically, it is more vital at lower level of management which is also known as

supervisory or operational management as they need to follow the standard of

working procedures to carry out and to complete their daily task. These managers

also have to deal directly with employees on those small activities that complement

to organization’s goals and objectives.

In other words Technical Skill is the ability of a manager to use the equipments,

methods and techniques involved in performing specific tasks. This skill is required

more at the lower level of management i.e. at the supervisory level. For the higher

levels, the technical skill is less important as managers can rely upon others for

these technical informations. Line managers and operation managers are represent

this group.

Human skills is the ability of a manager to work with, understand, and motivate

people in the organization. It also involves the ability to build effective work teams

involve building cooperation and the capability to work well with other peoples both

individually and in a team. The human aspect of management requires individual as

well as group relations to be maintained and developed for achieving maximum

efficiency.

Since managers have to deal directly with peoples from time to time, they need to

pose good interpersonal skills to communicate with peoples especially their fellow

colleagues and subordinates. Human skills are important at all levels of management

but it is very crucial at the middle level management since they need to lead,

motivate, communicate and inspire enthusiasm and getting the trust among their

peoples, supervisors and workers group to achieve company’s common goal. This


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skill is crucial and the managers with this skill are able to get the best out

of their people. One of the examples is company negotiators, departmental head,

project managers and HR managers.

Lastly, conceptual skills involve manager’s ability to see the organization as a

whole (Certo & Certo, 2009). Ability to coordinate all organizational activities and

varied interests involved in it. It involves viewing the organization in its totality and

understanding the inter-dependence of its individual parts.

Most of the times, manager have to think and conceptualize about abstract and

complex situations (Javed, 2009).

Conceptual skill is very important for top management in formulating long-range

plans, broad policies and relating the business enterprise to the related industry and

economy. These top management managers must have the skills to complement

functions of the sub-units to each other and visualize how the organization fits into its

broader environment, think about the future or life of the company in advance in

which shall includes the goals, objectives and directions of the company.

They should also aware of how changes in one part of the organization will influence

the rest of the organization. These managers must also be able to see any small

activities to be done by their employees that can support the goals and objectives of

the company. Conceptual skill is the most difficult skill to acquire. People that must

possess these skills are Managing Directors and Chief Operating Officers.

Figure 1: As a manager moves from the supervisory level to the top-management level, conceptual

skills become more important than technical skills, but human skills remain equally important

(Certo & Certo 2009).

In a nutshell, these three managers from different management levels must maintain

good relationship among each other and their group, in order to achieve

organization’s objectives and goals.


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Question 2 Describe FOUR (4) popular variables established by the contingency approach. Explain how each variable might affect management approaches in different organizations. Provide an example of each. [9 marks]

Answer 2

Defining management is the ability to execute tasks that meets organisational goals

through organisational resources and when we talk about variables may affect the

management approach four basic management functions in the management

process the namely planning, organizing, influencing and controlling are referred.

The definitions of management process;

Planning: Choosing tasks that must be performed to attain organisational goals,

outlining how the tasks must be performed and indicating when they should be

performed (Certo & Certo, 2009). .

Organizing: Assigning the tasks developed under the planning function to various

individuals or groups within the organisation and then creates a mechanism to put

plan into action (Certo & Certo, 2009)..

Influencing: To control workers behaviour through motivating, directing,

communicating, group dynamics, leadership and discipline. The purpose is to

channel the behaviour of all personnel to accomplish the organization's mission and

objectives while concurrently helping them accomplish their personal achievement.

Controlling: Is ongoing process of establishing performance standards based on

the firm's objectives, measuring and reporting actual performance, comparing the

two, and taking corrective or preventive action where and necessary.

Figure 2: Relationships among the four functions of management used to attain organisation goals

(Certo & Certo 2009, p 34).


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The contingency approach emphasizes that given a set of circumstances as a result

of operating in different environments, managers will respond in a different way by

applying different actions not only by their own choices but also as dictated by their

surroundings.

Generally, this approach attempts to foresee the conditions or situations that the

organization might face in the future and list down various management methods

that are said to have higher chances of success. Initially, managers have to perceive

organizational situations as they exist in reality. Then, they have to select the best

management tactics accordingly to diverse situations.

Lastly, managers have to implement those tactics competently and effectively so as

to achieve success. This approach is based on the idea that, “although there is

probably no one best way to solve management problem in all organizations, there

probably is one best way to solve any given management problem in any one

organization” (Certo & Certo, 2009. p. 65). To be effective, planning, organizing,

leading and controlling must be tailored to the particular situations faced by an

organization.

Usually the contingency approach is required because the change of variables in the

Organisational Resources.

The Organisational Resources shall involve Man, Monetary, Materials, Machine,

Method, Management (Managerial Effectiveness & Efficiency) and Marketing.

Figure 3: Transformation of organizational resources into finished products through the production

process (Certo & Certo 2009, p 34).

Due to the changes in organisational resources it might change the planning,

organising, influencing and control. Sometime the change might affect single or two

of the management process but sometime it might took more or even all of them.

For examples shall a budget is reduced in a gas pipeline construction works, the

method of construction might need to be changed. For instance the horizontal

directional method (no digging policy) which is are expensive, shall be changed to

open cut method.


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A “contingency approach” needs to be carried out and the planning, organising and

control process need changed. Reasons, using different method shall involve

different machineries, equipments and group of workers even the schedule also

affected. Therefore the planning process needs to be changed. Using different

method means the implementation of works are changed and this shall involve the

change of organising process. Influencing process is remaining unchanged as the

HDD teams are also required motivating, directing, communicating, group dynamics,

leadership and discipline. Lastly the method of quality control also changed for a

different construction method (controlling process change). This scenario can also

be considered as implementation change.

In some cases the Project Manager need to make a change either to the people,

technology or structural in order to achieve the organisational effectiveness. The

change on either one or all these variables called organisational change.

Figure 4: Determination of organisational effectiveness by relationship among people, technological

and structural factors (Certo & Certo 2009, p 340).

For example the implementation of ISO 9000: 2000 in a company that do not

practice the early version of ISO shall affect the company controlling process. All the

earlier controlling process either shall be amended accordingly or need to be

included inside the company ISO procedures.

Shall the design engineer is changed the planning process might need to be

changed as well because the design and project approach may differ and in the

other hand shall a new technology is brought in, the organising process will be


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changed. If a worker or a group of workers need to be changed because of their bad

behaviour then the influencing process is to be changed.

Figure 5: The organisation, the levels of its environment, and the components of those levels (Certo

& Certo, 2009. p. 229).

Changes on one or more of the PESTEL component can also result to contingency approach. The changes involves shall affect not only the management process, organisation resources but also the external environment component. One of the external environmental factors that entrepreneur should take into

consideration will be political factors. They have to beware of government policy

such as the degree of intervention in the economy. Specifically, political factors

include areas such as labour law, tax policy, environmental law, subsidies, trade

restrictions, tariffs, and political stability. Furthermore, governments have great

influence on the certain items e.g. health, education, and infrastructure of a nation.

For example shall suddenly the government stop giving the work permit for foreign

workers from Indonesia and bring in more workers from Pakistan, the influencing

process may change as different group of people shall requires different type of

approach.

Second, economic factors which include interest rates, taxation changes, economic

growth, inflation and exchange rates should be considered since it can have major

impact on a firm’s behaviours. For example, investment is not advisable when


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interest rates are high because the borrowing cost will be higher therefore the

planning process need to be changed e.g. company operation should rely on

project with self financing our limit to own resources.

Third, social factors include the cultural aspects and include health consciousness,

population growth rate, age distribution, career attitudes and emphasis on safety or a

greater number of pensioners in a population. Demographics needs and demand.

Change of demographics shall require change in planning process in order to suit

the revolution.

Next, technological factors are essential as well since lots of new products and

processes had been created by technological advances. Some of the times,

technology e.g. automation, will reduce a firm’s product costs, improve product’s

quality and even lead to innovation this is change in organising process.

Not only that, environment factors which include weather and climate change are

important as well. Firms should be aware of the environmental issues due to the

recent global warming and make some efforts by creating more environmental

friendly products and processes as this will definitely affect the demand patterns and

generate more business opportunities this is change in planning process.

Lastly, legal factors are those related to the legal environment in which firms

operate. New legal system such as increase in the minimum wage or greater

requirements for firms to use recycle product will definitely increase a firm’s

production costs. These factors can affect company operations, operation costs, and

the demand for its products. This might change the controlling process.


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Question 3 Please read the following article – ‘The High-Intensity Entrepreneur’ and discuss how entrepreneurs can effectively plan when the external environment is continually changing. [10 marks] Answer 3

An entrepreneur is a person either man or woman who is an innovator in nature that

is able to produce some products on demand for the general public, the

government and even the military. They are more likely to pick up niches that are

not over-crowded and they actually create new niche and market segments most of

the times.

Basically, they have the ability to organize multiple peoples, tasks and resources on

any given day. They are visualizer and an actualizer as they can visualize something

and when they visualizes they see exactly how to make it happen.

Not only that, they are risk takers and see “problems” as “opportunities” and

create value by taking action to identify the solutions to those problems. In

order to succeed, they can bear with constructive criticism of their business and

adapt it quickly to achieve the best product possible with the lowest cost and highest

quality. Good entrepreneurial characteristics are crucial in creating and maintaining

an organization that is capable to effectively carry out its corporate strategies over

the long term. Eventually, the entrepreneur is able to adapt quickly to changes in its

external environment through the deployment of fluid and dynamic strategic plans

due to the development of core competence over times (Hadji & Cocks, 2007).

A charismatic entrepreneur should have a vision of what their organizations can do

and become. Most of the times, their image will induce enthusiasm, expectation and

commitment in others. Thus, they should clearly communicate this vision to

associates and motivate them to support this vision. Another important quality of

successful entrepreneur is openness to changes. When it comes to make decisions,

they should not be stubborn and headstrong because the path to success lies in

evolution of ideas, services, products or technology. They should be aware of the

latest technologies by keeping on changing and evolving with the time. Not only that,

they should be courageous enough to bear risk while pursuing opportunities, and

often are associated with creative and innovative actions.

Planning for entrepreneurship is a process where individuals/company identifies

opportunities, allocate resources and create value through the identification of unmet

needs or through the identification of strength, weakness, opportunities and threat for

change in order to capitalizing the strength and minimizing weakness. This is some

people call a SWOT Analysis. It is simply the combination of ideas, hard work and


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adjustment to the changing business market. It also involves meeting market

demands and management at all times. The SWOT Analysis is meant for both

internal and external elements.

Internal elements basically the strength and weakness of the company which involve

management, operation, finance and marketing.

I’m 100 percent agrees with the above article and with the entrepreneurs proof of

success, it is hard to believes that all these entrepreneurs just do it by luck or by

chances. I believe they had really done their homework, study, understand and

managed their business well including understanding and monitoring their business

internal and external environment changes.

Planning effectively in changing external environment

The opportunities and the threats relates to the changing of external environment

shall be discussed thoroughly in this topic. The article did mention that one of the

reasons for the higher entrepreneurial intensity in emerging market is because there

are many undefended niches to occupy but without a proper planning the business

cannot be materialized.

Strategic business planning allows entrepreneur/company to analysis the

situations, find out hidden opportunities and reduce the impact of future

threats n the rapidly changing external environment.

In order to help entrepreneurs to identify, study, plan, execute control and monitor

their ideas or projects in a changing external environment there are several

models/tools that can be used as below;

i) Using Porter’s Model of Factors

In fact, entrepreneur should plan by taking into consideration Porter’s model of

factors that will determine one’s competitiveness within an industry. Since

entrepreneur is more likely to be an innovator, they shall evaluate each industry or

market segments before entering in order to ensure that it is not over-

crowded.

In the article mentioned about some of these entrepreneurs have a staying power

and able to adept challenging business environment into their competitive

advantage. Qanawat, a Saudi telecommunications company is one of the best

examples where they had took up rural areas in Saudi Area where difficult to reach

and untapped by the industry leaders. With that they managed to eliminate “new

entrants” currently their revenue had scaled up to RM 1 billion a year. Not only that,

with the experiences they are now positioned to expend to Africa and Middle East

market.


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Jordan Aramex, the FedEx of Middle East and Airbule the Pakistan new air line are

also other examples where they had successfully create an opportunity from

challenging situations. Despite luck, surely these entrepreneurs do study and

understand the external environment change of their business well.

According Porter’s Model, firstly, an entrepreneur has to take into account the

threat of new entrant. It refers to the ability of new firms to enter an industry

because this will affect the competition level. An industry’s attractiveness will

decrease as threat of new entrants increase. In the article, Amjad Aryan who

launched “Pharmacy 1” Jordan first drugstore chain surely had took this

consideration. The story of his successful is because there is no any threat from the

present market.

Figure 6: Porter’s model of factors that determine competitiveness within an industry (Certo & Certo,

2009. p. 232).

Second, buyer power is vital as well as it refers to the power that customers have

over the firms operating in an industry (Certo & Certo, 2009).

Third, supplier power refers to the power that suppliers have over the firms

operating in an industry (Certo & Certo, 2009). When the bargaining power of both

buyers and supplier increases the attractiveness of an industry will decrease. The

“Eye-2-Eye Optical” eye ware chain that founded by Saudi women, Aisha Natto

whereby she had even built her own manufacturing plant to meet the demand of her

high end glasses is one of the approach that can be taken to control the price, to

meet demand and reduces depended to suppliers.


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Fourth, the threat of substitute products refers to the probability of customers

consuming products or services in other industries instead of the focal industry. As

more substitutes become available, the demand becomes more elastic since

customers have more alternatives. A close substitute products will definitely

constraint the ability of firms in an industry to raise prices. Thus, an industry is no

longer attractive when there are lots of substitutes.

Lastly, intensity of rivalry is commonly referred as being intense, moderates or

weak based on the firms’ aggressiveness in to compete for the same customers and

resources. Competition among rival firms will drive profit to zero eventually. Again,

intensity of rivalry moves conversely with the attractiveness of an industry.

The article also mentioned that these new entrepreneurs form the emerging market

are mostly have experiences studying and working in America and European

countries, where they have gain their experiences, developed core market skills,

and international networks. With this background and most of them poses minimum

a first degree and some of them poses a higher degree believe it or not I believed

they had used this kind of model before opening their business. That is why most of

them had open a business which is consider “virgin” in their country.

ii) Using PESTEL Model

PESTEL model can also be used to monitor or diagnose the changing of external

environment that can affect to the success or failure of entrepreneurship. External

environments consist of economy condition, government policies, demographics,

technology, international influences, competitors and a changing labour force. The

ignorance of external environments will cause devastating impacts on an

organization. A formal strategic planning will definitely improve a firm’s performance

in overall. Since entrepreneurs operate all around the world, there is a need to

extend planning research to firms representing a diversity of national and cultural

settings (Hoffman, 2007).

One of the external environmental factors that entrepreneur should take into

consideration will be political factors. They have to beware of government policy

such as the degree of intervention in the economy. Specifically, political factors

include areas such as labour law, tax policy, environmental law, subsidies, trade

restrictions, tariffs, and political stability. Furthermore, governments have great

influence on the certain items e.g. health, education, and infrastructure of a nation.

The article says that the political and economic conditions in emerging

countries are also relaxed and this has also turned to be an advantage (example to

political factors).

Second, economic factors which include interest rates, taxation changes, economic

growth, inflation and exchange rates should be considered since it can have major


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impact on a firm’s behaviors. For example, investment is not advisable when interest

rates are high because the borrowing cost will be higher. Exchange rates affect the

costs of import/export activities. In the article, it’s mentioned that some of the

entrepreneurs had limit their capital business start up requirement of around RM

200,000.00, is also not too taxing but may affect a business shall no banks and

venture financing are involve (example to economic factors). Entrepreneur in

Malaysia are considered lucky as our Malaysian Government encourages

entrepreneurs through a lot of entrepreneur scheme and graduate entrepreneurs

scheme. Here we are able to get help and assistant form the bodies such as Ministry

of Entrepreneur & Corporative Development (MECD), “Tekun” fund, Bank

Pembangunan Malaysia Berhad (PBMB), Credit Guarantee Corporation (CGC),

Majlis Amanah Rakyat (MARA) and others.

Third, social factors include the cultural aspects and include health consciousness,

population growth rate, age distribution, career attitudes and emphasis on safety or a

greater number of pensioners in a population. Demographics needs and demand. In

the article, Qanawat, a Saudi telecommunications company which is the only

company that gave their services in the rural/remote areas is a good example for

social factors. The Dunkin’ Donuts in Beirut where the concept is to attract young

professional is also one of a good example where a good entrepreneur must be able

to think and understand what are the market needs and demand.

Next, technological factors are essential as well since lots of new products and

processes had been created by technological advances. Some of the times,

technology e.g. automation, will reduce a firm’s product costs and manufacture time,

improve product’s quality and even lead to innovation. The “Eye-2-Eye Optical” eye

ware chain that founded by Saudi women, Aisha Natto might be suitable for technical

factor, whereby she had introduced high end glasses and even built her own

manufacturing plant to meet the demand.

Not only that, environment factors which include weather and climate change are

important as well. Firms should be aware of the environmental issues due to the

recent global warming and make some efforts by creating more environmental

friendly products and processes as this will definitely affect the demand patterns and

generate more business opportunities or even the company who involves in this

business can enjoy a government grant or a low tax.

Lastly, legal factors are those related to the legal environment in which firms

operate. New legal system such as increase in the minimum wage or greater

requirements for firms to use recycle product will definitely increase a company’s

production costs. These factors can affect company operations, operation costs, and

the demand for its products. Surely this kind of situation is to be avoided by any

company.


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iii) Using Belbin 9 Team Roles Theory

Despite Porter’s and PESTEL Model, Belbin 9 Team Roles Theory is also

important to help a group of people or a team to success in their business.

In Belbin 9 Team Roles Theory it was identified that difference between

success and failure for a team was not dependent on factors such as

intellect, but more on people’s behaviour.

Therefore the team must understand the roles of behaviour’s clusters,

each one of the team member which formed distinct team contributions or

“Team Roles”. A Team Role was defined as: “A tendency to behave,

contribute and interrelate with others in a particular way.” When

the team can work successfully as a team those who work as a Resource

Investigators shall manage to carry out their job in

monitoring/understanding the external environment changing for the benafit of

the business and company.

They can also advice the “Plant” whether their product are good and as what market

demand and they can also advice the right technology for “Specialist” to

concentrate on.

Different individuals displayed different Team Roles to varying degrees

and Belbin 9 Team Roles Theory had differentiate each role as below;

The first Team Role to be identified was the “Plant”. The role

was so-called because one such individual was “planted” in each

team. They tended to be highly creative and good at solving

problems in unconventional ways.

One by one, the other Team Roles began to emerge. The Monitor

Evaluator was needed to provide a logical eye, make impartial

judgments’ where required and to weigh up the team’s options in

a dispassionate way.

Coordinators were needed to focus on the team’s objectives,

draw out team members and delegate work appropriately.

When the team was at risk of becoming isolated and inwardly-

focused, Resource Investigators provided inside knowledge on

the opposition and made sure that the team’s idea would carry to

the world outside the team.


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Implementers were needed to plan a practical, workable

strategy and carry it out as efficiently as possible.

Completer Finishers were most effectively used at the end of a

task, to “polish” and scrutinise the work for errors, subjecting it to

the highest standards of quality control.

Teamworkers helped the team to gel, using their versatility to

identify the work required and complete it on behalf of the team.

Challenging individuals, known as Shapers, provided the

necessary drive to ensure that the team kept moving and did not

lose focus or momentum.

It was only after the initial research had been completed that the

ninth Team Role, “Specialist” emerged. The simulated

management exercises had been deliberately set up to require no

previous knowledge. In the real world, however, the value of an

individual with in-depth knowledge of a key area came to be recognised as

yet another essential team contribution or Team Role. Just like the other

Team Roles, the Specialist also had a weakness: a tendency to focus

narrowly on their own subject of choice, and to priorities this over the

team’s progress.

Belbin 9 Team Roles Theory shall help the entrepreneurs to slot in the right

candidates in the respective role to get the best outcome or output. A good example

from the articles is Soudi-based Secu Tronic, a high-tech security company that has

flat management structure about 200 entrepreneurs are working together.

Conclusion

No matter how they done and what model were used, to be a successful

business/company, the entrepreneurs need to monitor, plan and make use of the

change of the external environment factors to their advantage.

bmom5203 - assignment _pt 1_

Documents

management managers

technical skills

human skills

conceptual skills

different skills

managers ability

operational management

middle level management