FAB/F1 Accountant in Business

Exam in June & December 2014

Lecture 5 ORGANISATION CULTURE AND COMMITTEES

Organisational departments and functions
Research and development

Purchasing

Production

Service operations

Marketing

Administration

The finance function

Human resources

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

Organisation culture

Definitions The way we do things around here The collection of traditions, values, policies, beliefs and attitudes that constitute a pervasive context for everything we do and think in an organisation (Mullins)

Types of culture

Harison classified four types of culture Charles Handy gave the names of a Greek God
Power culture (Zeus) shaped by one individual (e.g. the boss probably the person who started the company) Role culture (Apollo) a bureaucratic culture shaped by rationality, rules and procedures (e.g. management structure with different people having different roles) Task culture (Athena) shaped by a focus on outputs and results emphasis on getting the job done and achieving the task: to get the job done Person culture (Dionysus) shaped by the interests of individuals

Power culture

Zeus

Role culture

Apollo

The organisation is controlled by a key central figure, owner or founder. Power is direct, personal, and informal. Suits small organisations where people get on well

Classical, rational organisation: bureaucracy. Stable, slow-changing, formalized, impersonal. Authority based on position and function.

Task culture

Tthena

Person culture

Dionysus

Management is directed at outputs: problems solved, projects completed. Teambased, horizontally-structured, flexible, valuing expertise to get the job done.

The purpose of the organisation is to serve the interests of the individuals who make it up: management is directed at facilitating, administering

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

Question 1: Classifications of culture Review the following statements. Assign each of them to one of Handys four corporate cultures. People are controlled and influenced by: (a) (b) The personal exercise of rewards, punishments or charisma Impersonal exercise of economic and political power to enforce procedures and standards of performance Communication and discussion of task requirements leading to appropriate action motivated by personal commitment to goal achievement Intrinsic interest and enjoyment in the activities to be done, and/or concern and caring for the needs of the other people involved Type of culture

(c)

(d)

Question 2: Handys culture classification (F1 Specimen 6/14 q.33) In a higher education teaching organisation an academic faculty is organized into courses and departments, where teaching staff report both to course programme managers and to subject specialists, depending on which course they teach and upon their particular subject specialism. According to Charles Handys four cultural stereotypes, which of the following describes the above type of organizational structure? A B C D Role Task Power Person

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

Schein three levels of culture The link between leadership and organizational culture There are 3 levels of culture that leaders must appreciate:

Artifacts

Espoused values

Basic assumptions (the most difficult to identify and understand)

National culture (Hofstede model)

National culture influences organisation culture in various ways. Hofstede examined how people from different countries are likely to develop different organisational cultures and how national culture influences how people work and expect to be managed. Hofstede identified the following variables: Power/distance. Do people expect to be told what to do and then do it without question? Or do people come from a national culture where that approach would not be expected and probably not be acceptable, where they expect to have a more participative role to contribute to decisions? Uncertainty avoidance. Some national cultures shy away from taking risks; those people may prefer certainty. They dont come from a background which expects people to take gambles and which supports failure. Its sometimes said that the American business culture is one where failure, and effectively therefore uncertainty, is well tolerated, that there is no disgrace in trying and failing, and the only disgrace is in not trying. It could be that this is what partly contributes to the dynamism of the American economy. Individualism-collectivism. To what extent are all people within the organisation expected to agree with particular decisions and to conform to what other people are doing, or are they expected to go their own way? To a large extent Japanese culture expects collectivism. Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

Everyone is expected to agree on whats being done and an individual approach is frowned upon. In some countries individual approaches are likely to be praised and they have great respect for the maverick. Masculinity. This looks at the extent to which social gender roles are important. Cultures with high masculinity value assertiveness, competition, material success, and being dominant, whereas in those cultures feminine values of modesty, reaching consensus, understanding, and relationships are not valued so highly. Hofstede is not attempting to stereotype nationalities, but to provide an insight into why behaviour and assumptions might differ across geographical regions. This can be particularly useful when expanding internationally. Question: Hofstede Research has indicated that workers in country A display characteristics such as toughness and the desire for material wealth and possessions, while workers in country B value personal relationships, belonging and the quality of life. According to Hofstedes theory, these distinctions relate to which of the following cultural dimensions? A B C D Masculinity-femininity Power-distance Individualism-collectivism Uncertainty avoidance

Committees
Committee a group appointed to meet for a particular objective

Purposes of committees Creating new ideas Participation and problem solving Making recommendations Giving advice and making decisions Combining abilities Co-ordination

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business Role of chairman Ensure the Management Committee functions properly Maintaining order during the meeting Keeping the timing and the agenda of the meeting Conduct meetings and make impartial decisions Assist in the succession planning

Exam in June & December 2014

Role of committee secretary Before the meeting fixing the date and time of the meeting choosing and preparing the location of the meeting preparing and issuing various documents

At the meeting assist the chairman read the minutes of the previous meeting report on action or matters arising from the previous minutes Take notes of the meeting

After the meeting distribute the minutes of the meeting promptly send all correspondence as decided by the Management Committee

Types of committee Executive committee Standing committees Ad hoc committees Sub-committees Joint committees Management committees

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

MCQs ORGANISATIONAL CULTURE AND COMMITTEES

1 What are the elements of the purchasing mix? A B C D Place, product, price, promotion Quantity, quality, price, delivery Product, quality, price, delivery Place, product, price, delivery (EBQ) 2 The function plans, organizes and controls the necessary activities to provide products and services. Choose the correct word to fill in the blank A B C Planning Production Promotion

Marketing is the management process which identifies, anticipates and satisfies customer needs, regardless of expense. Is this true or false? A B True False

Which of the following are roles of the finance function? A B C To provide information to managers for decision-making To ensure compliance with social and legal responsibilities To record and control what happens to money

Selection is important to ensure that the organisation obtains people with the qualities and skills required. Is this true or false? A B True False

Bureaucracy is another name for a: A B C D Power culture Role culture Task culture Existential culture

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

A project team is most likely to be a: A B C D Power culture Role culture Task culture Existential culture

According to Hofstede, the extent to which security, order and control are preferred to ambiguity and change is called A B C D Masculinity Individualism Power distance Uncertainty avoidance

What is the name of a committee with the power to govern or administer? A B C D Joint committee Ad-hoc committee Executive committee Standing committee

10

Which of the following is not one of the main objectives of Human Resource Management? A B C D To obtain the right number and type of skilled employees for the organisations current and future requirements To develop and deploy the organisations employees in such a ways as to maximise flexibility and productivity To ensure compliance with the organisations social and legal responsibilities in relation to employees To minimize labour turnover and maximize employee retention within the organisation

11

Which of the following is most likely to be an example of an existential culture in Harrisons model of cultural types? A B C D An entrepreneurial start-up business A partnership of graphic designers A construction project A large telecommunications company

12

Committees are particularly effective for carrying out day to day work. Is this statement true or false? A B True False

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

13

Which of the following is the MAIN function of marketing? A B C D To maximise sales volume To identify and anticipate customer needs To persuade potential consumers to convert latent demand into expenditure To identify suitable outlets for goods and services supplied

14

Neill works as the procurement manager of JL Company, a large services company. Information provided by Neill is most relevant to which of the following elements of the marketing mix? (price;promotion;place;product) A B C D Physical evidence Distribution (or place) Price Processes

15

Which type of culture did Charles Handy suggest best suits a simple and small organisation? A B C D Role Task Power Existential or Person (BPP i-Pass)

16

Which of the following is a DISADVANTAGE of using a committee rather than an individual to make a decision? A B C D Slower decisions Unsupported decisions Autocratic decisions Unworkable decisions (Pilot paper 2 Q.47)

17

In the context of marketing, the four Ps are price, promotion, __________ and __________. Which TWO words correctly complete the above sentence? 1. 2. 3. A B C Product Positioning Place 1 and 3 1 and 2 2 and 3

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

18

Which of the following is part of the research and development function of a business? A B C D The analysis of survey data on consumer behaviour, produced under contract by an independent market research company Organising exhibitions and sales promotions Creating new products and improving existing ones Contracting independent advertising agencies to promote the products being sold by the company

19

A large, well-established construction company organises itself on a project basis, using temporary matrix and project team structures. What cultural type is most likely to fit this organisation? A B C D Role culture Power culture Task culture Person culture

20

X Ltd is a small company, founded by Mr X. Mr X still manages the firm personally, and all major decisions are referred to him by employees, via direct communication. His personal enthusiasm, and eye for business opportunities, is an inspiration for many of the staff. Mr X has recently committed the company to a new business venture, which entails setting up a warehouse facility: X Ltd has employed a team of talented individuals to design and launch the facility. Once this has been accomplished, a large semi-skilled staff will be taken on to undertake storage operations on an on-going basis.

From the information given, what cultural type will best suit X Ltds objectives at each new stage of its development?

Current culture A B C D Power Person Task Role

Warehouse design/set-up A B C D Power Person Task Role

Warehouse operations A B C D Power Person Task Role (BPP kit 2010)

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

21.

Which type of culture, according to Handys model, would best suit a matrix structure? A B C D Role Person Power Task (BPP i-Pass)

Answer

1 8

B D

2 9

Production 3 C

False

A;C

True

10 D 17 A

11 B 18 C

12 B 19 C

13 B 20 A;C;D

14 C 21 C

15 C

16 A

Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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FAB/F1 Accountant in Business

Exam in June & December 2014

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Myo Thein Naing BA (Eco), DMA, Dip IFR, ACCA (Affiliate)

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