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CASE 1 PRINCIPLES OF MANAGEMENT

17
th
September, 2014 - WEDNESDAY
MODERATOR: Ms. Jigisha
The Marketing manager of AMK Enterprises, Roopali Deshmukh (Deshmukh) stepped out of the
conference hall in a pensive mood after an important meeting called by the CEO. The meeting was
attended by the heads of various departments in the company and was convened to discuss the
targets for the coming assessment year. Deshmukh had a formidable sales target to achieve and
wondered how she would be able to meet those seemingly impossible goals. This fear was further
aggravated by the fact that the productivity levels of employees in the company had been falling.
Deshmukh was under tremendous pressure from the management to improve the performance of her
team. She also had to deal with the decreasing levels of employees morale in her 24-member team.
As a first step, Deshmukh informed her team members about a meeting that she planned to hold the
next day. She then drafted a plan of action that she intended to discuss with her team.

The next day, Deshmukh began the meeting by informing her team members about the corporate
meeting she had attended. She then said, We have a difficult task ahead for this year, and your
participation and involvement is essential to achieve the goals. She then invited suggestions from her
team members regarding the role to be played by each of them. The meeting then progressed on to
setting of individual targets for by each team member as, it was felt that this would help in
accomplishing the organizational goals. Specific goals were, therefore, set and agreed upon by all the
team members. The team aimed to increase the organizational profits by 18% over the next six
months.

They sketched out a plan of action to achieve the targets set for the team and decided that they would
meet once every two months to monitor their progress.

Two months later, the team met again and received their progress. Deshmukh also gave a feedback
on the performance of every member of the team. The team then collectively identified the areas of
improvement and decided upon the measures they would take to overcome their deficiencies. This
continued for the rest of the year. The final review meeting was held just before the yearly corporate
meeting attended by the top management. The team was surprised to see that they had achieved
their targets.

Thus, effective planning and control mechanisms helped the team achieve their short term goals, and
this in turn, helped in the achievement of the organizational objectives. Besides, the employees were
also motivated as the management gave adequate recognition to their involvement and participation
in achieving team goals. The target to be achieved by the team was highly challenging.
This further motivated the team members as they had better opportunities to prove their problems
solving skills. Thus, the outstanding performance of the sales team helped the organization achieve in
the long term.

Questions for Discussions:

1. Roopali Deshmukh followed the practice of management by objectives (MBO) while setting
goals for team members. Discuss the various phases of the MBO process that helped her team
achieve its goals.

2. Explain briefly the process of MBO and the various advantages of implementing MBO in
organizations.



CASE 2 PRINCIPLES OF MANAGEMENT
18
th
September, 2014, Thursday
MODERATOR: Ms. Minu

The president of Simplex Mills sat at his desk in the hushed atmosphere, so typical of business
offices, after the close of working hours. He was thinking about Rehman, the manager in-charge of
purchasing, and his ability to work with George, the production manager, and Vipulabh, the marketing
and sales manager in the firm.

When the purchasing department was established two years ago, both George and Vipulabh agreed
with the need to centralise this function and place a specialist in charge. George was of the view that
this would free his supervisors from detailed ordering activities. Vipulabh opined that the flow of
materials into the firm was important enough to warrant a specialised management assignment. Yet
since the purchasing department began operating it has been precisely these two managers who
have had a number of confrontations with the new purchase manager, and occasionally with one
another, in regard to the way the purchasing function in being carried out.
From Georges point of view, instead of simplifying his job as production manager by taking care of
purchasing for him, the purchasing department has developed a formal set of procedures that has
resulted in as much time commitment on his part as he had previously spent in placing his orders
directly with vendors. Further, he is specially irritated by the fact that his need for particular items or
particular specification is constantly being questioned by the purchasing department. When the
department was established, George assumed that the purchasing manager was there to fill his
needs, not to question them.

As Vipulabh sees it, the purchasing function is an integral part of marketing function, and the two
therefore need to be jointly managed as a unified process. Purchasing function cannot be separated
from a firms overall marketing strategy. However, Rehman has attempted to carry out the purchasing
function without regard for this obvious relationship between his responsibilities and those of
Vipulabh, thus making a unified marketing strategy impossible.

In his previous position, Rehman had worked in the purchasing department of a firm considerably
larger than Simplex. Before being hired, he was interviewed by all the top managers, including
George and Vipulabh, but it was the president himself who negotiated the details of the job offer. As
Rehman sees it, he was hired as a professional to do a professional job. Both George and Vipulabh
have been distracting him from this goal by presuming that he is somehow subordinate to them, which
he believes is not the case. The people in the production department, who use the purchasing
function most, have complained about the detail that he requires on their requisitions. But he has
documented proof that materials are now being purchased much more economically than they were
under the former decentralised system. He finds Vipulabhs interests more difficult to understand,
since he sees no particular relationship between his responsibilities for efficient procurement, and
Vipulabhs responsibilities to market the firms products.

The president has been aware of the continuing conflict among three managers for some time, but on
the theory that a little rivalry is healthy and stimulating, he has felt that it was nothing to be unduly
concerned about. But now that much of his time is being taken up by much of what he considers to be
petty bickering, the time has come to take some positive action.

Questions for Discussions:

1. Is Georges view of the situation realistic?

2. How do you evaluate Vipulabhs position?

3. How might this conflict be associated with factors in the formal organisation?

4. What should the president of Simplex Mills do now?

CASE 3 PRINCIPLES OF MANAGEMENT
19
th
September, 2014, Friday
MODERATOR: Mr. Umang


Bharat Engineering Works Limited is major industrial machineries besides other engineering products.
It has enjoyed market preference for its machineries because of limited competition in the field.
Usually there have been more orders than what the company could supply. However, the scenario
changed quickly because of the entry of two new competitors in the field with foreign technological
collaboration. For the first time, the company faced problem in marketing its products with usual profit
margin. Sensing the likely problem, the chief executive appointed Mr Arvind Kumar as general
manager to direct the operations of industrial machinery division. Mr Kumar had similar assignment
abroad before coming back to India.
Mr Kumar had a discussion with the chief executive about the nature of the problem being faced by
the company so that he could fix up his priority. The chief executive advised him to consult various
heads of department to have first hand information. However, he emphasised that the company
lacked an integrated planning system while members of the Board of Directors insisted on introducing
this in several meetings both formally and informally.
After joining as General Manager, Mr Kumar got briefings from the heads of all departments. He
asked all heads to identify major problems and issues concerning them. The marketing manager
indicated that in order to achieve higher sales, he needed more sales support. Sales people had no
central organisation to provide sales support nor was there a generous budget for demonstration
teams which could be sent to customers to win business.
The production manager complained about the old machines and equipments used in manufacturing.
Therefore, cost of production was high but without corresponding quality. While competitors had
better equipments and machinery, Bharat Engineering had neither replaced its age-old plant nor
reconditioned it. Therefore to reduced the cost, it was essential to automate production lines by
installing new equipment.
Director of research and development did not have specific problem and therefore, did not indicate for
any change. However, a principal scientist in R&D indicated on one day that the director of R&D,
though very nice in his approach, did not emphasize on short-term research projects, which could
easily increase production efficiency by at least 20 per cent within a very short period without any
major capital outlay.
Questions for Discussions:

1. Discuss the nature and characteristics of the problems in this case.
2. What steps should be taken by Mr Kumar to overcome these problems?