Management Theory and Practice

1- E-commerce sector has been on a boon period in the current 21st century.
People tend to get better quality goods all under one website. This century is the
era of E-commerce sector and thus our question states that one of the E-
commerce company had a potential sale that means newer funds to be used
within the organization. This brings us to that there will some change in the
working and governing of the company. Change is the part of life; we cannot
really control it or complaint about it. The only thing we can do is accept it bravely
and learn to adjust to it. Similarly, change is a part of market and business too.
Markets evolve on a regular continuous basis, and the idea is to conquer through
the change rather than be a victim of the same. Various companies have had
their own share of opportunities.

As there are fresh funds from the sale and the company needs to restructure itself,
also being a manager I will be allotted some amount of finances which will frame my
answer about which type of organizational structure as a company we should go for,
there are many different organizational structure approaches which can be followed.
Mangers need to decide the appropriate approach as to how to get the people to work
together to achieve the goal of the organization. It is the duty of the manager to how to
group people so that they can perform the work efficiently. The different approaches are
functional, divisional, matrix, team, and networking. Some of them are as discussed
below:

Divisional Structure- As an organization is huge with mangers having different

tasks daily, it is at times difficult to keep the track of all the activities completely
on their own. So, to keep the track of everything, there are specialized
departments created. These departments are divided on the basis of the output
they provide to the organization. Example- Production, Customer Service,

The Functional Structure- The functional structure basically groups or divides

according to their work units, which is based on the expertise, similar activities,
skills and resources. It means the groups are divided on the way they function
and thus are name the Functional Structure. Example- Human Resources,
 Marketing, Operations, Finance, Production etc. are the main groupings of
Functional Structure, we see in our day to day life in an organization.
Matrix Structure- The matrix structure combines functional specialization with the
focus of divisional structure. This structure uses permanent crossfunctional
teams to integrate functional expertise with a divisional focus. Employees in a
matrix structure belong to at least two formal groups at the same timea
functional group and a product, program, or project team. They also report to two
bossesone within the functional group and the other within the team. This
structure not only increases employee motivation, but it also allows technical and
general management training across functional areas as well.

Team Structure- Team structure organizes separate functions into a group based
on one overall objective. These crossfunctional teams are composed of
members from different departments who work together as needed to solve
problems and explore opportunities. The intent is to break down functional
barriers among departments and create a more effective relationship for solving
ongoing problems.

Network Structure- The network structure basically depends on other

organizations to perform critical functions on the basis of the contract. In other
words, managers can contract out specific work to specialists meaning the
special work is given to the specialists on the contract basis using its network to
make the work comparatively easier and more easy and professional. This
approach provides flexibility and reduces overhead because the size of staff and
operations can be reduced. On the other hand, the network structure may result
in unpredictability of supply and lack of control because managers are relying on
contractual workers to perform important work.

As a manger, first I will consult with my top management about the same and put in my
recommendation that I would personally go for Matrix Structure as it is the combination
of the functional and divisional structure. In other words, employees have dual reporting
relationships - generally to both a functional manager and a product manager. In a
matrix organization, instead of choosing between lining up staff along functional,
geographic or product lines, management has both. The staff actually reports to a
functional manager who can help with skills and review work and help in choosing the
prior work and to a product line manager who sets direction on product offerings by the
company. This structure has some advantages such Resources can be used efficiently,
since experts and equipment can be shared across projects. Also, Products and
projects are formally coordinated across functional departments. Even the Information
flows both across and up through the organization and employees are in contact with
many people, which helps with sharing of information and can speed the decision
process.
Thus, the matrix structure is the best organization structure approach out of many that
we discussed above.

2- Decision making can be a tough job in a competitive world like this. Different
Organization works differently on the basis of the objective set up to reach there
organizational goal. Organizations basically function by making decisions. The
decisions are mainly taken by the manager who plans, controls, direct, staff, leads the
team by taking the decisions in order to achieve the goals of an organization. The
quality of the decision taken by the manger in true terms determines how successful the
manger will be and how impactful the decision is in achieving the goal of the
organization. To solve the issues faced by an organization, managers take a huge
decision in it. At times the process of decision making is extremely short and very
spontaneous. On the other hand, at times the decisions take a very long time to
because the managers do not want to take any risk and very conscious to make the
right decision. The entire decisionmaking process is dependent upon the right
information being available to the right people at the right times. The steps of the
decision making are as follows-

1. Define the basic problem we are facing

2. Identify the limiting factor of the situation

3. Develop potential alternatives to reach the objective

4. Analyze the alternatives.

5. Select the best alternative suited to the objective

6. Implement the decision.

7. Establish a control and evaluation system.

There are many approaches for the great decision making. It is very important to take
good decisions as it can either make or break the organization. Here are the 4 different
approach to a good decision making.

Autocratic Decision-Making

An Autocratic decision-making style is the most appropriate for situations where there is
not a huge impact i.e where there is a low impact and the small decisions are usually
more relevant but they get larger as urgency goes up. In Autocratic decision-making,
decisions are made by the top level management and Buy-in is not seen as an
important aspect of making this decision. And actually, it is not advisable to involve
many people while making decision thus the top level management is only included to
make the decisions. Usually, in an environment where youre making Autocratic
decisions, there is a very tightly structured on the work activities as well as the roles as
theyre monitored and well controlled. The key factors are indeed Control and
Command in such decision making environments.

Participatory Decision-Making

Participatory decision-making style is used in a situation where there is a need for larger
decisions where theres an utmost urgency and the call needs to be made soon,
however the impact as well is going to be big. This is where the people are also
included while making the decision as the impact is going to be big and the people are
going to be affected too so the decision is taking by the participation of others as well. It
is important to know that Participatory decisions when theres a lot more risk involved
and the decision to be taken is much bigger than the usual. Gathering additional
information from more people is going to reduce that decision making risk. Also by
getting that buy-in, the risk of opposition is reduced because while taking the final call,
the decision of and the advice of the main people was also taken and this decision is
not only taken by the top level management alone.

Consensus-Based Decision-Making

Consensus-based decision-making style is used when in situations where its a large

decision required however there is a plenty of time to take the decision and there is
actually no urgency at all. It gives a lot of time to properly analyze the situation and then
actually take the decision as already mentioned there is no urgency at such. Also, it can
be said as this is where decisions are reached with a cross-functional team. The
different departments and the people have their own input, and buy-in is essential. This
style of decision-making is usually reserved for making the biggest decisions in an
organization. However it is also recommended to notice that these decisions have a lot
of time and they should be actually make a use to the organization. It is important to get
everybody to say yes before the actual decision is taken. They are going to be
individuals from multiple groups and departments, from multiple functions, all working
together, coming up together all for that final perspective for the final decision.

Democratic Decision-Making

Democratic style is used in a situation where for mid-sized decisions where theres a
little urgency but there is a need to make a decision then this is the most appropriate
way of the decision making. This is where a decision is usually taken by a majority vote.
Buy-in is desirable but its not necessary. These are the decisions we just have to make
and get it over with. Individuals are going to interact in this style. There may be a need
to have a committee where people are going to be together, form an opinion, but
ultimately we set a deadline, we vote and its done. Its just like how we vote for our
government.

According to me, Democratic Decision making will be the best option to go for. It
will give each individual to put in there vote for the benefit of the firm. This will
also show them a sense of belongingness in the firm. They will feel that everyone
is valued here. Hence it will be a win-win situation for the firm and thus making
life and work easier for a firm in a particular environment. The decision making
system will also help in bring positive change on the working of the organization.

3 a- Leader and managers are sometimes used in place of one another. These
people do have similar traits but in a professional organization they are viewed
as 2 different personnel with different motive and goals to reach in a given period
of time. Further we will briefly discuss about the difference between the 2
personnel working in an organization as individuals. Leader and Manager have
similar traits as both want the organization to grow and achieve great heights
however they are still different from each other and few of the traits. Managers
are the ones who set up the goals, and their focus is on achieving the goals.
They plan, direct and control the decisions, take the decisions which is required
all to attain the ultimate goal of the organization effectively and efficiently
however Leaders on the other hand, create a vision, they paint a picture of what
can be done more and also includes the people to help in attaining the vision.
Leaders are unique in their own way however Managers copy what is asked from
them all to achieve the goal. Leaders are the ones who usually take risks as they
want to try something new as they have a vision for the organization however
Managers usually control risks. As they try to reduce the problems rather than
actually embracing them, they try to minimum it. Lastly leaders have his own fans
 due to his vision, he gains many followers and Managers have his employees, as
he has the staff who will listen to their boss.

Different types of leadership styles- Different leaders have different types of

styles which help them in achieving their vision. Some of them are:

Democratic- This style of leadership is also called the Participative style as

in this there is an actual participation of the employees while taking the
decision. Democratic leadership helps in boosting the employee morale because
employees make. This style of leadership brings in the best in the employees but
in this type of leadership style a lot of politics prevails as well which the leader
has to take care while formulating it in a plan.

Autocratic- This type of leadership style includes the decision making is done
only by the leader and no participation of the other members exists. There is full
authority of the managers which is imposed on the employees. This style of leadership
style is also seen in Hindu undivided family company in which the head of the family
take all the decisions himself alone. Example- Cuba and North Korea have Autocratic
style.

Transactional-

The transactional leadership style includes the employees to perform certain tasks and
based on that the managers provide rewards or punishments to team members based
on performance results. Managers and team members set predetermined goals
together, and employees agree to follow the direction and leadership of the manager to
accomplish those goals. This style basically works on the basis of merits and demerits
that is if you are working well you will be rewarded for the same in monetary or non-
monetary means also if you are not able to reach the goal assigned to you, you may
tend to be punish for the same in monetary and non-monetary terms. This brings in
competitiveness among the employees and thus increases efficiency. The manager has
the right to review results and give feedback to their employees fail to meet goal. When
the employee accomplishes goals, they receive rewards and bonus.
3-b- Motivation is a force to drive the person into work or into action. In business
context, it means inspiring workers to perform tasks willingly towards accomplishment of
organizational goals. The concept of motivation has evolved over time and has given
rise to a number of theories on the subject. The large number of theories on motivation
can be classified as traditional theories and modern theories. One traditional model
which I am going to discuss about is the McClellands Theory of Needs

McClellands Theory of Needs states that motivation can be explained with the help of
the three needs that are achievement, power and affiliation.

These are the explanation of the three needs stated above

1. Need of achievement- it is drive to excel, and urge to achieve the targets or goals
which you have planned for yourself as an individual in life. Every person have
some self-objective in life which he/she wants to achieve. So once an individual
is able to reach that achievement point in his life he feels motivated and happy in
his life.

2. Need of Power- It means that to have can make other behave in a certain
manner in which they otherwise wouldnt have. Everyone wants to be on the top
of the company and want to share their ideas of how to govern a company and
how should behave and work in a manner better suited to us. Who doesnt love
power; it gives a sense of domination to oneself and thus giving a lot of
motivation as well.

3. Need of Affiliation- it is a desire to be a friendly person and have an interpersonal

relationship. Every individual needs some support system in their life. Friends
and colleagues fill in this position and also give them a sense of affiliation to
oneself. One will be more motivate with having friends rather than being lonely
and alone all the time.

Of all the three need of motivation McClelland and his associates focused most on need
of achievement. They believe this need is the most important need in one person life.
They perceive the probability of success with this need to be 0.5. This means if there is
no achievement then there will be no challenge involved in a goal

This theory of motivation has many advantages. This theory is very easy and simple to
understand than any other theory and it also gives more empirical support than any
other theory of motivation. However this theory has some limitations too as well, this
theory has been seen as less practical in real life. The three needs operate at a
subconscious level and many a times, an individual might not even be aware of their
existence. So, to know about these needs in the people working in the organization and
measuring them, to cater to them, is not easy.