Domain I – Business Acumen – Section A : Organizational Objectives, Behaviour, and Performance - Bis

Question 1

Classical (traditional‐formal‐structural)

Answer 1

emphasizes the concepts of authority, responsibility, strict hierarchy, and prescribed spans of control. In the classical approach, an organizational chart is first identified then employees are sought to fill the related jobs.

Question 2

Behavioral

Answer 2

emphasizes the group’s characteristics and how such groups function, attempting to design jobs that fit the employees. The limits, strengths, and interest of people available are identified in order to fit jobs for them to achieve the organizational objectives.

Question 3

Contingency

Answer 3

is a modern approach taking into account the unique situations that the organization may be placed in. It is considered a synthesis of the other two approaches
in that all other factors are considered while organizing including the nature of the organization such as its size, age, and capabilities, and the influences of its
environment, existing work force, and technology.

Question 4

Motivation

Answer 4

is a dynamic process that normally starts with a need (physiological or psychological), which sets a drive with the aim of achieving a goal or an objective.

1. Needs are deficiencies resulting from physiological or psychological imbalance.
2. Drives are set up to alleviate the deficiencies or needs of an individual.

Question 5

The Hierarchy of Needs Approach (by Abraham Maslow)

Answer 5

assumes that people have a variety of general needs that can be arranged in a hierarchy in the order in which people seek to fulfill them: physiological needs, security needs, belongingness needs, esteem needs, self‐actualization needs.

Question 6

ERG Theory (by Clayton Alderfer)

Answer 6

suggests that people’s needs are grouped into three possibly overlapping categories:

i. Existence Needs which pertain to the basic needs for human survival
ii. Relatedness Needs including the social needs of relating to others.
iii. Growth Needs which are comparable to Maslow’s self‐esteem and selfactualization needs.

Question 7

The Equity Theory

Answer 7

states that people tend to form perceptions of equity and/or inequity by comparing their work/compensation combination with their perceptions of the work/compensation combination of others.

i. If they believe that their work/compensation ratio is equivalent to that of others, they experience a feeling of equity.
ii. If they believe that there is a negative mismatch between their work/compensation ratio when compared to that of others, they experience a feeling of inequity.

Question 8

The Expectancy Theory (by Victor Vroom)

Answer 8

sets that motivation depends on how much employees desire something and how likely they think they will get it.

i. Effort‐performance expectancy refers to the individuals’ perception of how likely their efforts will lead to the successful performance of their jobs or objectives.
ii. Performance‐outcome expectancy refers to the individuals’ perception of assessing the certainty in accomplishing the specified tasks and achieving the required outcome.
iii. Outcomes refer to the results of performance. The outcome may be a pay raise, a promotion, stress, fatigue, etc. People have differing positive and negative valences for the same outcome.

Question 9

Theory X

Answer 9

managers who adopt Theory X believe that employees generally dislike work, and to motivate them, managers should coerce, control, and/or threaten them to work.
=> Generally, managers who adopt this theory are of an autocratic nature.

Question 10

Theory Y

Answer 10

managers who adopt Theory Y believe that employees generally like work, and under the proper circumstances, accept and seek responsibilities to fulfill their social esteem, and self‐actualization needs.
=> Generally, managers who adopt this theory are of a permissive nature.

Question 11

Theory Z

Answer 11

managers who adopt Theory Z believe that employee participation is the key to increasing productivity and improving the quality of work life.

Question 12

Job Design

Answer 12

refers to how organizations define and structure jobs – it is the determination of an employee’s work‐related responsibilities.
=> Properly designed jobs have a positive impact on employee motivation, while poorly designed jobs can negatively impact employee motivation, performance and overall job satisfaction.

Question 13

Job Rotation

Answer 13

refers to the systematic moving of employees from one job to another so that boredom and monotony are minimized.

Question 14

Job Enlargement

Answer 14

refers to giving employees more tasks to perform. It is

considered a horizontal expansion of an employee’s current job.

Question 15

Job Enrichment

Answer 15

refers to increasing the number of tasks the employee performs and granting them more control over their jobs.

Question 16

Alternative Work Schedules

Answer 16

refers to any work schedule that does not conform to a traditional eight‐hours‐a‐day, five‐days‐a‐week design.

Question 17

Management by Objectives (MBO)

Answer 17

is a management approach that encourages employee participation in setting their own goals.
=> MBO periodically assesses employees’ performance based on their progress towards achieving the mutually set goals.

Question 18

Rewards

Answer 18

the objective of the organizational reward system is to allocate compensation and other benefits in order to attract, retain, and motivate qualified employees.

Question 19

Positive reinforcement

Answer 19

presents the employee with a desirable consequence to strengthen and increase employee acceptable behavior.
=> Examples include a pay raise, or managerial compliments.

Question 20

Negative reinforcement (avoidance)

Answer 20

terminates or withdraws an action perceived as undesirable by employees to strengthen and increase employee acceptable behavior.
=> For example, if an employee is criticized for spelling mistakes in reports, the employee will avoid criticism by submitting a correctly spelled report.

Question 21

Punishment

Answer 21

implies introducing an action in an attempt to penalize the employee when certain employee behavior occurs.
=> Examples include pay deductions, verbal or written reprimands.

Question 22

Group Dynamics

Answer 22

refers to the forces and interactions amongst group members.

Question 23

Group Cohesiveness

Answer 23

refers to the group’s commitment to remain together.
=> It is the result of the interaction of various forces that define the strength of the members’ attachments to their group.

Question 24

Norms

Answer 24

refer to the behavior that ought to occur i.e., what is considered acceptable by the group.
=> In a cohesive group, they normally reinforce group values and provide the group members with a common identity.

Question 25

Roles

Answer 25

refer to positions prescribed by the prevailing norms that can be acted out by group members.
=> Roles consist of a pattern of norms.

Question 26

Formal groups

Answer 26

refer to formally established groups such as committees.

Question 27

Informal groups

Answer 27

refer to groups formed by members for political, friendship, or common‐interest reasons.

Question 28

Groupthink

Answer 28

occurs when the group’s desire to make the best decision is overwhelmed by its desire for consensus.

Question 29

Groupshift

Answer 29

occurs when members exaggerate the initial position that they hold.

Question 30

Group‐aided decision‐making

Answer 30

occurs when a group performs all the stages of the decision‐making process except for making the decision.

Question 31

Task‐motivated leader

Answer 31

focus on completing assigned tasks.
=> The members work extremely well together, or when they do not, that is, when the group has either clearly defined tasks or poorly defined tasks.
=> Leader has either full control over remuneration, progression, and bonuses, or no control over the same.

Question 32

Relationship‐motivated leaders

Answer 32

focus on getting the members of the group to work together.

=> The leader is said to work with the strengths of the group and around its weaknesses.

Question 33

Organizational politics

Answer 33

refer to activities carried out by individuals in organizations, particularly large ones, to acquire, enhance, and/or use power.

Question 34

Power

Answer 34

refers to the person’s ability to influence the behavior of another person.
=> Power may be the result of position, expertise, experience, and/or personality.

Question 35

Expert Power

Answer 35

an individual or leader could have more knowledge about a certain field or aspect, thus empowering him/her.

Question 36

Referent Power

Answer 36

refers to the ability stemming from an individual’s style and personality to cause others to relate to him/her.

Question 37

Reward Power

Answer 37

a manager who gives bonuses to employees has power over them because this manager is in control of their rewards.

Question 38

Coercive Power

Answer 38

is when a leader, manager, or individual can influence power over someone else through methods that apply pressure such direct threats or the use of punishment.

Question 39

Legitimate Power

Answer 39

is when someone has the right to exercise power due to position or status e.g., a CEO has legitimate power over a middle manager.

Question 40

A team

Answer 40

is a small number of individuals who commit their complementary skills to a common purpose, performance, and/or goal.

Question 41

Vertical teams

Answer 41

are composed of a leader/manager and subordinates that report to the leader in the formal chain of command.
=> Usually, the vertical team includes a single department in an organization.

Question 42

Horizontal teams

Answer 42

are composed of employees from the same hierarchical level but from different departments.
=> The two most common types of horizontal teams are cross‐functional teams and committees.

Question 43

Special‐purpose teams

Answer 43

refer to teams usually consisting of cross‐functional highly skilled members to examine complex company‐wide projects, such as introducing new technology or improving the quality of the organizational work processes.

Question 44

Self‐managed teams

Answer 44

refer to teams responsible for producing an entire product, a component, or an ongoing service.

Question 45

Problem‐solving teams

Answer 45

are teams made‐up of volunteer members who attempt to work on tasks such as quality improvement, cost reduction, or overall improvement in the work environment.

Question 46

Quality Circles

Answer 46

are group of members usually from the same functional department who volunteer to meet regularly and work on improving performance and quality in their areas.

Question 47

Virtual teams

Answer 47

are teams with members dispersed over a wide geographic area, who coordinate and function using technology.

Question 48

Leadership

Answer 48

refers to the act of motivating, stimulating, and/or influencing others to perform activities designed to achieve objectives.

Question 49

Authority

Answer 49

refers to the officially granted privilege to direct others.

Question 50

Leadership styles

Answer 50

refer to the manner in which a leader uses available power to lead others to perform the activities designed to achieve objectives.

Question 51

Autocratic leaders

Answer 51

make their own decisions without consulting others and orders subordinates to perform.

Question 52

Consultive (Consultative) leaders

Answer 52

consult with their subordinates, however, they do the ultimate decision.

Question 53

Participative (Democratic) leaders

Answer 53

grant a role to their subordinates to participate in the decision making process, and include their opinions in the ultimate decision.

Question 54

Free‐reign (laissez‐faire) leaders

Answer 54

leave most decisions to their subordinates.

Question 55

Bureaucratic leaders

Answer 55

are those who manage “by‐the‐book”. Although this approach may seem old‐fashioned, it still has its merits when dealing with sensitive areas (e.g. chimical, cash, high value items)

Question 56

Transactional leaders

Answer 56

use their power and authority to attain high subordinate performance.
=> Punishments and rewards are used to increase success and minimize failure.

Question 57

Transformational leaders

Answer 57

the transformational style of leadership generally requires charismatic leaders.
=> It asserts that effective leaders need to be charismatic, inspirational introducing new visions to inspire people.

Question 58

Trait Approaches (leadership theorie)

Answer 58

– trait approaches to leadership conducted researches in an attempt to identify traits that characterize effective leaders.
=> The results of these studies led to a laundry list of traits that effective leaders possess, such as: drive, motivation, honesty and integrity, cognitive abilities or intelligence, charisma and social participations, self‐confidence, scholarship achievements.

Question 59

Behavioral Approaches (leadership theorie)

Answer 59

behavioral approaches to leadership conducted researches in an attempt to identify behaviors that differentiate effective leaders.
=> Three distinct researches: The Michigan Studies, The Ohio State Studies, The Managerial‐Grid model of Leadership or the Leadership Grid

Question 60

The Michigan Studies (behavioral approaches)

Answer 60

the research resulted in identifying two basic forms of leader behavior:

i. Job‐centered leader behavior when the leader pays more attention to subordinates’ work and is immensely interested in performance.
ii. Employee‐centered leader behavior when the leader is interested in ensuring that employees are satisfied with their jobs. This type of leader is interested in a highly cohesive work group.

Question 61

The Ohio State Studies (behavioral approaches)

Answer 61

– identified several forms of leader behavior but focused on the two most significant ones:

i. Consideration behavior – the leader shows his/ her subordinates concern and strives to establish a good working environment.
ii. Initiating‐structure behavior – the leader sets ground rules on how tasks should be performed by subordinates and has formal lines of communication with them.

Question 62

The Managerial‐Grid model of Leadership or the Leadership Grid (behavioral approaches)

Answer 62

evaluates leaders along two dimensions and suggests that high levels of both dimensions lead to effective leadership styles. The two dimensions are:

i. Concern for production
ii. Concern for people (employees)

Question 63

Contingency Approaches

Answer 63

contingency approaches to leadership advocate that in addition to personal characteristics and traits, people become leaders based on situational and circumstantial factors.

Question 64

Hersey and Blanchard (contingency approaches)

Answer 64

identified leadership styles according to situational factors, which were modeled on a grid.
They recognized four leadership styles
i. S1: Telling/Directing – ideal if a subordinate has low competence, high commitment, is unable, but willing, while the leader experiences high task and low relationship commitment.
ii. S2: Coaching/Selling – ideal if a subordinate has some competence, low commitment, is confused and unwilling, while the leader experiences both high task and high relationship focus
iii. S3: Participating/Supporting – ideal if a subordinate has high competence, variable commitment, is able, but unwilling or insecure, while the leader experiences low task and high relationship focus.
iv. S4: Delegating – ideal if a subordinate has high competence, high commitment, is able, and willing, while the leader experiences low task and low relationship focus.

Question 65

House’s Path‐Goal theory (contingency approaches)

Answer 65

is another contingency model of leadership, that is similar in some ways to the Heresy and Blanchard model.
This theory identifies different leadership behaviors – a leader can have four styles of behavior:
v. Directive – showing subordinates how things are done, set goals, and designate tasks.
vi. Supportive – take care of and protect subordinates’ preeminent interests.
vii. Participative – include subordinates in decision making especially concerning matters that are linked directly to them.
viii. Achievement‐oriented – set goals that are challenging for the subordinates concerning both work and self‐ improvement.