Organization Theory and Management-1


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Q1. What do you understand by administrative management theory? How is it different from scientific management theory?

Q2. Satisfying the claims of shareholder’s should be the paramount concern of a company. Discuss the arguments for and against this statement.

Q3.Discuss the factors that affect ethical and unethical behavior.

Q4. On what grounds can you suggest that all business houses must assume social responsibility?

Q5. What is power? Explain the various sources of power giving suitable example.



Q1. What is the relationship between Organisation Structure, Organisation Design and Organisation Culture?


Q2.Compare and Contrast Maslow’s Need Hierarchy theory with that of Herzberg’s Two Factor theory.


Q3.a) What is Human Resource Planning? Explain its Significance.

  1. b) Explain in brief the sources of power?




Mr. Sreenivas (55) working as manager in Alfa Chemicals, a large scale industrial establishment engaged in the production of Phosphate and Sulphur. He has 30 years of experience in Alfa Chemicals. He has an excellent track record as Manager Human Resources within the organization. Many times he got ‘best employer award’ to performance excellence. His area of expertise in recruitment and selection process, and performance appraisal has been widely acknowledged.


The Information Technology division of Alfa Chemicals industry once faced acute shortage of manpower. Mr. Raj, Manager IT division put forward an immediate requirement of 10 employees in the IT division, to HR department, starting from junior level to senior level. As and when Mr. Sreenivas got the letter from Mr. Raj, in his department, he started processing of it. To get it done, he approached many sources. He had gone through the data bank of company and considered 100 resumes for recruitment from it. He also informed the employees and employers of the organization, in their respective departmental notice board, showing the immediate requirement of 10 employees to facilitate the internal recruitment procedures. From the employees and employers of Alfa Chemicals he got around 150 applications with resumes. In addition to that in order to give an opportunity to candidates’ external to the organization he floated an advertisement in several daily news papers viz., Times of India, Sakal, and Indian Express. From external sources he got around 350 applications. Almost 600 candidates, including internal and external applicants, applied for 10 vacant posts. To ensure the reliability and dependability of the process, Sreenivas made his personal scrutiny at all levels, in the recruitment and selection process. Since the entire department function as a team in HR, all the members trust each other and extended their valuable contribution in the recruitment and selection.


The department conducted a preliminary interview in order to made first screening process and filter the number of applicants. After the first screening process the HR department reduced the number of applicant list from 600 to 500 applicants. He conducted a written test and group discussion and there by further reduces the number of applicants to 300. These 300 candidates then exposed to one hour psychometric test and out of which 50 candidates selected for the final interview. From the final interview, 10 candidates finally selected. The entire process of recruitment and selection took almost 3 months. The selected candidates list then forwarded to the top management for the final approval. HR department informed the candidates that the appointment letters will be sent to those who are selected for the post.


Sreenivas approached several time to the top management about to get final approval of list of candidates for the IT department. Sreenivas informed the IT department also that the delay in the final list announcement as the top management take some more time. He waited almost 4 weeks. But, no reply at all. Mr. Raj, the IT manager every day enquired about the latest information about the final list of the candidates and tentative date of induction. Sreenivas faced the difficulty to make any comment on the subject as there was no information from the top management. HR department had to answer many phone calls from out side and inside the organization, as recruitment involved candidates from inside and outside. The employers and employees of the industry, whose relatives got into the final selection process, became regular visitors of the HR department, asking for the finalist. Sreenivas called a meeting of HR team members and once again made a close verification of the entire process. But he couldn’t find any fault in any of the recruitment and selection process. As the time went on he became more suspicious about the delay in the announcement of the result.


When the problem becomes so crucial Sreenivas got direction from the top management to meet Mr. Kartik, General Manager, one of the top officials in the organization. Mr.Kartik asked the entire process of recruitment and selection that made on IT professionals. Sreenivas furnished the entire details of the process in a precise report. Mr. Kartik read the entire report and soon after made a direct comment that the recruitment and selection process that for IT professionals need to be cancelled as he observed some discrepancies in the process made by his department. He further directed Sreenivas that the vacancies have to be filled through contract basis and no permanent vacancies to be made in these positions, for one year. Further he informed Sreenivas that another recruitment process to be done from external candidates applied and no internal application to be entertained. Sreenivas couldn’t agree with the Mr. Kiran comment on his department’s inefficiency in the recruitment and selection process. For a while he thought about quitting the organization, as he faced a baseless allegation from the top management. Till date there is no black mark in his functional dissemination. On many occasion he helped the industry to find out best possible solutions in order to tackle the many manpower crisis. Sreenivas became so depressed and felt quiet unhappy about the decision taken by the management.


Mr. Sreenivas called an urgent meeting of his subordinates and communicated the management decision and directives. He shared with the team members that the management had greater dissatisfaction on the recruitment and selection process done by the department. He enquired that any one made any mistake in the process. All members denied the probability of any mistake. As there were clear norms and regulations related to each step and there was no dual command, they found no possibility of creeping errors in the selection process. In the meeting he informed his subordinates that the management freezes the appointment process for IT professionals and asked for external recruitment on contract basis. It was shocking news to members. They asked several questions to get a proper clarification from Sreenivas. As Mr. Sreenivas himself unaware of the reasons behind management decision, he informed his subordinate his inability to give a proper reply in this regard. Sreenivas also informed this matter to Mr. Raj.


During the evening hours, in the same day, Sreenivas got a call from Mr. George, one of his senior-level Managers, with whom he had friendly and informal relationship. Mr. George asked Srinivas to come to his cabin. As per the call Mr. Sreenivas met George in his cabin. George enquired about his family and many unofficial matters in the informal interaction. Half an hour later, Mr. George enquired about the recruitment and selection process of IT professionals. He shared with George all those things happened with top management. Leaving aside the informal interaction, George initiated formal discussion with Sreenivas. He told Sreenivas that the selected list of IT professionals consisted two names, Mr. Avdesh and Mr. Praveen, they are the relatives of two trade union leaders of the organization. The management felt that being the relatives of two trade union leaders, in the long run, they could be a threat to organization. It may create an image that the trade unions still have a control over the decision making process in organization. Further, the hold of trade union may expand if this selection process materializes. Mr. Geroge informed Sreenivas that management didn’t have any doubt about the dependability and exactness of the recruitment processes that HR departmentr did.


George further informed Sreenivas that as per the intimation from top management he called Mr. Sreenivas and briefed about the undercurrents of this episode. The entire news was shocking to Mr. Sreenivas. He didn’t know that the management decision had this much of undercurrents. After hearing entire story Sreenivas become so silent and returned to his cabin.


While sitting inside his cabin, he made a silent comment that, “what a useless effort.



  1. What are the undercurrents of selection process in Alfa Chemicals?
  2. How management decision justifies management effort in the maintenance of harmonious industrial relation?
  3. Do you believe that as HR Manager, Mr. Sreenivas failed to gather direct and indirect information about the candidates?
  4. How ‘cancellation of appointment’ decision that affect the moral of organizational members?
  5. How you interpret the dilemma of HR managers have to face in such kind of situations.
  6. What would be your decision if you have to face such situation?
  7. Do you believe that trade unions have ‘quota’ in appointments?
  8. How the decision affect the reduction of wastages and improvement of resources.
  9. Is the decision reflecting management fear towards trade union or inability to develop a congenial industrial relationship within the organization?
  10. How you interpret the silence of Mr. Sreenivas?




Q1. Which of the following was contributed by F.W. Taylor?

(a) Principles of Management

(b) Scientific Management

(c) Theory of Motivation


Q2. Management is:

(a) An Art

(b) A Science

(c) Both


Q3. Pioneer of Human Relations is:

(a) Mary Parker Follert

(b) Elton Mayo

(c) Lillian Gilberth


Q4. Henry Fayol laid down

(a) 10 principles

(b) 12 principles

(c) 14 principles


Q5. Espirit de corps means

(a) Union is strength

(b) Buyer Beware

(c) Service is our motto


Q6. The Era of Scientific Management

(a) 1830-1880

(b) 1880-1930

(c) 1930-1980


Q7. Era of Human Relations:

(a) 1930-40

(b) 193080

(c) 1930-50


Q8. Which of the following skills is important in all levels of an organisation?

(a) Conceptual

(b) Human

(c) Technical


Q9. In the…….approach to management, managerial practice depends on circumstances.

(a) System’s

(b) Contingency/Situational

(c) Empirical


Q10. Which of the following theories give managers a new way of looking at an organisation as a whole and as a part of the larger external Environment:

(a) Contingency theory

(b) System’s theory

(c) Theory X and Y


Q11. Who proposed that human needs develop in a hierarchical manner?

(a) Elton Mayo

(b) Abraham Maslow

(c) Chris Argyris


Q12. Decreasing the role of subordinates in decision making is known as

(a) Decentralisation

(b) Centralisation

(c) Organisation


Q13. Weber coined the term …….to identify large organisations that operated on a rational basis.

(a) Autocracy

(b) Diplomacy

(c) Bureaucracy


Q14. Which of the following determines a person’s ethical or unethical behavior?

(a) Values

(b) Procedures

(c) Rules


Q15. In which of the following situations does an intensity of an ethical issue increase?

(a) Everyone agrees that the action is right

(b) Many people will be harmed by the action

(c) When the action has no serious impact on people.


Q16. Which level of Managers is involved in the development of plans?

(a) Top-level managers

(b) Middle-level managers

(c) All the above


Q17. Organisations use contingency plans to cope with……..?

(a) Anticipated events

(b) Predetermined events

(c) Unforeseen events


Q18. ………describes a process by which a course of action is selected to deal with a specific problem.

(a) Decision making

(b) Strategic planning

(c) Goal setting


Q19. ……………power is based on the influencer’s ability to punish the influence for not meeting the requirements.

(a) Referent

(b) Legitimate

(c) Coercive


Q20. A Lawyer specialized in criminal law is said to have which type of power?

(a) Expert

(b) Referent

(c) Coercive


Q21. ………….power refers to the influence which people or groups may exert because people believe in them and their ideas.

(a) Referent

(b) Expert

(c) Coercive


Q22. A company has the following managers-Manager (Production), Manager (Finance), Manager (Marketing). This is an example for departmentation by:

(a) Functions

(b) Products

(c) Territory


Q23. A collection of values, norms, beliefs, attitudes and habits which directs the behavior of a group of people is known as:

(a) Culture

(b) Philosophy

(c) Rules

Q24. Which of the following is not an activity in the human resource management Process?

(a) Training

(b) Human Resource Planning

(c) Mission Formulation


Q25. ……….is the organisation function of planning for human resource needs, recruiting and training candidates and evaluating their performance.

(a) Resource Management

(b) Human Resource Management

(c) Employee Manangement


Q26.Which of the following involves estimating the size and makeup of the future workforce, and helping the organisation acquire the right number and right kind of people when they are needed?

(a) Human Resource Planning

(b) Workforce Planning

(c) Organisational Planning


Q27. …………is formally defined as a planned effort to improve the performance of the employee in his area of work.

(a) Development

(b) Training

(c) Staffing


Q28 ………………..consists of a set of activities aimed at attracting and selecting individuals for positions in a way that will facilitate the achievement of organizational goals

(a) Recruitment

(b) Selection

(c) Staffing


Q29. Comparing an individual’s job performance against standards or objectives developed for the individual’s position is known as………..

(a) Job appraisal

(b) Evaluation

(c) Performance appraisal


Q30. ……………. is the process of identifying and attempting to attract candidates who are capable of effectively filling job vacancies.

(a) Recruitment

(b) Staffing

(c) Selection


Q31. …………involves choosing the candidates who best meet the qualifications and have the greatest aptitude for the job.

(a) Staffing

(b) Recruitment

(c) Selection


Q32 ………., proposed by Douglas McGregor, has a positive, dynamic, flexible and optimistic view of employees.

(a) Theory X

(b) Theory Y

(c) Theory Z


Q33. In Alderfer’s ERG theory, ERG stands for………

(a) Existence-Relatedness gain

(b) Existence-Relatedness growth

(c) Endurance-Relatedness growth


Q34. According to Herzberg, …… are job content factors which lead to job satisfaction.

(a) Motivators

(b) Hygiene factors

(c) Context factors


Q35. In the …………organisation structure, positions are combined into units on the basis of similarity of expertise, skills and work activities.

(a) Matrix

(b) Divisional

(c) Functional


Q36. The first real task in designing an organisation structure is to identify all the activities of the organisation and group them properly. This process of grouping the activities is commonly known as……………

(a) Departmentation

(b) Centralisation

(c) Organisation.


Q37. Organisation Culture is an aspect of the ………..environment of an organisation.

(a) Task

(b) Internal

(c) External


Q38. Which management approach can be classified as scientific, administrative and bureaucratic approach.

(a) Classical

(b) Neo-Classical

(c) Modern


Q39. Which of the following systems consists of sets of interacting elements operating without any exchange with the environment in which it exists

(a) Closed

(b) Open

(c) Flexible


Q40. Company G adopted a performance appraisal approach that includes assessment of individual’s performance by his her superior’s, subordinates and peers. Which of the following method of appraisal is Company C following?

(a) 90-degree appraisal

(b) 180-degree appraisal

(c) 360-degree appraisal