Q1 : Discuss various tasks of a professional manager.

Describe the survival and growth options which your

organization has adopted or any organization you are familiar with. Describe the organization you are referring
to.

A : The Webster dictionary describes a manager as ‘someone who handles or directs with a degree of skill’. But this
definition is not rigid as are the responsibilities. Critical responsibilities of a professional manager are:
Responsibility towards Customers: A firm's responsibility towards its customer is in terms of ensuring that the desired
quality of product at a reasonable price is made easily available to the customers. It is the responsibility of the manager to
provide the right match between quality and price.
Responsibility towards Shareholders: The main responsibility of the manager is to ensure the security of the
shareholders' capital. The manager must ensure that the firm does not become bankrupt. In other words, the manager
must, at least, ensure the survival of the firm. The manager has to ensure that the shareholders are able to earn profit on
their capital.
Responsibility towards Employees: Employees are the most important resource. The manager has to ensure that
employees are getting a fair deal in terms of wages and salaries. The responsibility of a manager is to ensure that all
dealings with the employees are fair. Whether it is determining the profit linked bonus that is being calculated or the
provident fund of a retired employee, which has to be paid, you must ensure that the employees are not cheated,
harassed or embarrassed.
Responsibility towards Suppliers: Suppliers provide the raw materials, components and parts necessary for the
production of products. The manager's responsibility towards suppliers of funds, i.e., banks and other financial institutions,
is that not only he has to make the interest payments, but make the repayment on time as per the agreed repayment
schedules.
Responsibility towards Distributors and Retailers: A manager is responsible for ensuring regular supplies to the
distributors. The products that are supplied to the distributor must be checked for quality to ensure that second grade or
inferior quality goods are not shipped.
Responsibility towards Industry and Competition: A manager is responsible to register the firm as a member of
industry association and comply with all its rules and regulations.
Responsibility towards Union: A manager should acknowledge employees' union as a friend rather than as a foe of the
firm. Most problems with unions arise because of the assumption of the managers that unions have no constructive
contribution. A responsible manager must understand and appreciate the fact that the management and union have a
great degree of mutual dependence and the union cannot further its interests at the cost of the firm's interests and vice
versa.
Responsibility towards Government: A manager should ensure that the constitution and operations of the firm are
within the legal framework as specified by the government.
Responsibility towards Society: The manager has responsibility towards his surroundings and the people living in the
vicinity of his factory and office. Firms behave irresponsibly when they pollute the environment by releasing harmful
gasses, discharging toxic effluents into nearby rivers, lakes or seas, and dumping their waste matter in surrounding lands.
A manager should make sure that the operations of the firm do not obstruct, disturb, disrupt or destroy physical structures
(historical buildings, monuments), the flora and fauna, and animal and human life. Specialization in every field,
technological advancement, globalization of business results into appointment of qualified managers. They can be called
as professional managers.
A professional manager is an expert, trained and experienced enough to adeptly manage any type of organization be it a
manufacturing house, a service organization, a hospital or a government agency. Professional managers:
Are objective, focussed and performance oriented.
Help in meeting competitive challenges of business.
Are creative and dynamic.
Follow management practices based on world wide experiences and information.
Apply theories of management to solve emerging organizational problems.
Some Professional Manager Tasks
Providing direction to the firm: The first task, envisioning goals, is one of the tasks that should never be delegated. This is
the ability to define overarching goals that serve to unify people and focus energies. It’s about effectively declaring what’s
possible for the team to achieve and compelling them to accomplish more than they ever thought possible.
Managing survival and growth: Ensuring survival of the firm is a critical task of a manager. The manager must also seek
growth. Two sets of factors impinge upon the firm’s survival and growth. The first is the set of factors which are internal to
the firm and are largely controllable. These internal factors are choice of technology, efficiency of labour, competence of
managerial staff, company image, financial resources, etc. The second set of factors are external to the firm like
government policy, laws and regulations, changing customer tastes, attitudes and values, increasing competition, etc.
Maintaining firm’s efficiency: A manager has not only to perform and produce results, but to do so in the most efficient
manner. The more output a manager can produce with the same input, the greater will be the profit.
Meeting the competition challenge: A manager must anticipate and prepare for the increasing competition. Competition is
increasing in terms of more producers, products, better quality, etc.
Innovation: Innovation is finding new, different and better ways of doing existing tasks. To plan and manage for innovation
is an on-going task of a manager. The manager must maintain close contact and relation with customers. Keeping track of
competitor’s activities and moves can also be a source of innovation, as can improvements in technology.
Renewal: Managers are responsible for fostering the process of renewal. Renewing has to do with providing new
processes and resources. The practices and strategy that got you where you are today may be inadequate for the
challenges and opportunities you face tomorrow.
Building Human Organization: Man is by far the most critical resource of an organization. A good worker is a valuable
asset to any company. Every manager must constantly look out for people with potential and attract them to join the
company.
Leadership: Organizational success is determined by the quality of leadership that is exhibited. "A leader can be a
manager, but a manager is not necessarily a leader," says Gemmy Allen (1998). Leadership is the power of persuasion of
one person over others to inspire actions towards achieving the goals of the company. Those in the leadership role must
be able to influence/motivate workers to an elevated goal and direct themselves to the duties or responsibilities assigned
during the planning process. Leadership involves the interpersonal characteristic of a manager's position that includes
communication and close contact with team members. The only way a manager can be acknowledged as a leader is by
continually demonstrating his abilities.
Change management: A manager has to perform the task of a change agent. It’s the managers task to ensure that the
change is introduced and incorporated in a smooth manner with the least disturbance and resistance.
Selection Information technology: Today’s managers are faced with a bewildering array of information technology choices
that promise to change the way work gets done. Computers, the Internet, intranets, telecommunications, and a seemingly
infinite range of software applications confront the modern manager with the challenge of using the best technology.
Example
A professional manager or a chief administrative officer for a city has duties which include meeting with elected council to
determine polices that are determined by the council and to notify council members and citizens about the local
government operations. Discussing of certain reforms, installing a bridge, setting up new traffic plans, or proposing a new
building-all these and many more things which can affect community life are some of the responsibilities of the
professional manager in a township. He is also responsible for preparing the annual budget, presenting it to elected
officials for sanction and then implementing it, after it is approved. Listening to citizen grievances with regards to
administration, civic problems, law and order and presenting the matter to the elected officials for appropriate actions are
some of the tasks of a professional manager who is in charge of the administration of a city. A skill is the learnt capacity or
talent to carry out pre-determined results often with the minimum outlay of time, energy, or both1. In other words, a skill is
an ability or proficiency that a person possesses that permits him or her to perform a particular task2.
Technical Skills
Technical skill is the ability to use specific knowledge, techniques, and resources in performing tasks. Examples of
technical skills are writing computer programs, completing accounting statements, analyzing marketing statistics, writing
legal documents, or drafting a design for a new airfoil on an airplane. Technical skills are usually obtained through training
programs that an organization may offer its managers or employees or may be obtained by way of a college degree.
Indeed, many business schools throughout the country see their role as providing graduates with the technical skills
necessary for them to be successful on the job.
Analytical Skills
These skills are the abilities to identify key factors and understand how they interrelate, and the roles they play in a
situation. Analytical skills involve being able to think about how multiple complex variables interact, and to conceive of
ways to make them act in desirable manner.
Decision Making skills
These skills are present in the planning process. A manager's effectiveness lies in making good and timely decisions and
is greatly influenced by his or her analytical skills.
Digital Skills
These are important because using digital technology substantially increases a manager’s productivity. Computers can
perform in minutes tasks in financial analysis, HRP, and other areas that otherwise take hours, even days to complete.
Human Skills
Human skill involves the ability to interact effectively with people. Managers interact and cooperate with employees.
Human skills, therefore, relate to the individual's expertise in interacting with others in a way that will enhance the
successful completion of the task at hand.
Communications Skills
Effective communication is vital for effective managerial performance. The skill is critical to success in every field.
Communication skills involve the ability to communicate in ways that other people understand, and to seek and use
feedback from employees to ensure that one is understood.
Conceptual Skills
Conceptual skill is the ability to see the “big picture,” to recognize significant elements in a situation, and to understand the
relationship among the elements. Examples of situations that require conceptual skills include the passage of laws that
affect hiring patterns in an organization, a competitor's change in marketing strategy, or the reorganization of one
department which ultimately affects the activities of other departments in the organization.
Design Skills
It is the ability to solve problems in ways that will benefit the organization. To be effective, particularly at upper levels,
mangers must be able to do more than see a problem. They must also be able to design a workable solution to the
problem.

Specialization in every field, technological advancement, globalization of business results into appointment of qualified
managers. They can be called as professional managers.
A professional manager is an expert, trained and experienced enough to adeptly manage any type of organization be it a
manufacturing house, a service organization, a hospital or a government agency. Professional managers:
Are objective, focused and performance oriented?
Help in meeting competitive challenges of business.
Are creative and dynamic.
Follow management practices based on world wide experiences and information.
Apply theories of management to solve emerging organizational problems.

Some Professional Manager Tasks

Providing direction to the firm: The first task, envisioning goals, is one of the tasks that should never be delegated. This is
the ability to define overarching goals that serve to unify people and focus energies. It’s about effectively declaring what’s
possible for the team to achieve and compelling them to accomplish more than they ever thought possible.
Managing survival and growth: Ensuring survival of the firm is a critical task of a manager. The manager must also seek
growth. Two sets of factors impinge upon the firm’s survival and growth. The first is the set of factors which are internal to
the firm and are largely controllable. These internal factors are choice of technology, efficiency of labors, competence of
managerial staff, company image, financial resources, etc. The second set of factors is external to the firm like
government policy, laws and regulations, changing customer tastes, attitudes and values, increasing competition, etc.
Maintaining firm’s efficiency: A manager has not only to perform and produce results, but to do so in the most efficient
manner. The more output a manager can produce with the same input, the greater will be the profit.
Meeting the competition challenge: A manager must anticipate and prepare for the increasing competition. Competition is
increasing in terms of more producers, products, better quality, etc.
Innovation: Innovation is finding new, different and better ways of doing existing tasks. To plan and manage for innovation
is an on-going task of a manager. The manager must maintain close contact and relation with customers. Keeping track of
competitor’s activities and moves can also be a source of innovation, as can improvements in technology.
Renewal: Managers are responsible for fostering the process of renewal. Renewing has to do with providing new
processes and resources. The practices and strategy that got you where you are today may be inadequate for the
challenges and opportunities you face tomorrow.
Building Human Organization: Man is by far the most critical resource of an organization. A good worker is a valuable
asset to any company. Every manager must constantly look out for people with potential and attract them to join the
company.
Leadership: Organizational success is determined by the quality of leadership that is exhibited. "A leader can be a
manager, but a manager is not necessarily a leader," says Gemmy Allen (1998). Leadership is the power of persuasion of
one person over others to inspire actions towards achieving the goals of the company. Those in the leadership role must
be able to influence/motivate workers to an elevated goal and direct themselves to the duties or responsibilities assigned
during the planning process. Leadership involves the interpersonal characteristic of a manager's position that includes
communication and close contact with team members. The only way a manager can be acknowledged as a leader is by
continually demonstrating his abilities.
Change management: A manager has to perform the task of a change agent. It’s the managers task to ensure that the
change is introduced and incorporated in a smooth manner with the least disturbance and resistance.
Selection Information technology: Today’s managers are faced with a bewildering array of information technology choices
that promise to change the way work gets done. Computers, the Internet, intranets, telecommunications, and a seemingly
infinite range of software applications confront the modern manager with the challenge of using the best technology.

Example

A professional manager or a chief administrative officer for a city has duties which include meeting with elected council to
determine polices that are determined by the council and to notify council members and citizens about the local
government operations. Discussing of certain reforms, installing a bridge, setting up new traffic plans, or proposing a new
building-all these and many more things which can affect community life are some of the responsibilities of the
professional manager in a township. He is also responsible for preparing the annual budget, presenting it to elected
officials for sanction and then implementing it, after it is approved. Listening to citizen grievances with regards to
administration, civic problems, law and order and presenting the matter to the elected officials for appropriate actions are
some of the tasks of a professional manager who is in charge of the administration of a city.

FACTORS AFFECTING THE SURVIVAL AND GROWTH OF INFORMATION

TECHNOLOGY VENTURES
Technology firms are the subject of a great deal of research interest. Many
factors which influence the performance of firms in other industries are now
being tested for applicability and impact on technology-based ventures.
Although this research has done a great deal to illustrate the similarities between
the technology and other industries, it has done little to extend our understanding
of the specific challenges faced by technology firms and the strategies which
must be employed to address them. This paper describes these challenges and
identifies the factors that are therefore most significant in predicting the survival
and growth of information technology ventures.
A quick glance at the articles contained in the issues of scholarly journals such as the
Academy of Management Journal/Review, Strategic Management Journal, and the Journal of
Business Venturing, would quickly highlight that technology-based firms are the subjects of a
great deal of interest and research. These firms face a unique set of challenges and opportunities,
and the environment is so dynamic and unpredictable that this curiosity is well-founded.
Although the research has done a great deal to understand how specific business activities and
competitive factors impact and behave in the technology industry, scholars have not defined what
makes this industry different from other industries and why it merits such curiosity. Furthermore,
although many factors that influence the success and survival of firms in this industry are
common to many industries, those that are particularly salient to information technology firms
have not been specifically identified and targeted for study. The intent of this paper is to
describe the characteristics of the information technology industry which distinguish it from
other industries, and identify the factors that impact the survival and growth of young ventures in
this industry.
The characteristics which set this industry apart are its knowledge intensity, dynamism,
lack of predictability, and network effects. Knowledge intensity results in the phenomenon where
a single company rarely has the full range of knowledge or expertise needed for timely and costeffective
product innovation (Lam, 1997). The industry is also very dynamic and unpredictable
due to the speed with which technology changes and advances (Sorensen and Stuart, 2000).
Network effects are the result of the fact that the value of connecting to a network is determined
by the number of other users already connected to it (Shapiro and Varian, 1999).
These characteristics highlight several factors that significantly influence the survival and
growth of the young information technology firm, and in some cases do so in unique ways:
acquisition of knowledge, integration of knowledge, technology strategy, option development,
legitimizing activities, endorsements, networks and alliances, and social capital.
The first section of this paper will discuss the characteristics of the information
technology industry which are believed to be unique to the technology sector. The next section
will discuss the factors listed and their relationships to each other as well as how they contribut
to the survival and growth of the young technology firm. The final section of the paper concludes
by discussing directions for future research.
Characteristics of the Information Technology Industry
Knowledge Intensity
The information technology industry is highly knowledge-intensive (Sorensen et al.,
2000), suggesting that ventures that compete in it can be characterized as repositories of
knowledge (Kogut and Zander, 1996) rather than product-market combinations. Furthermore,
this industry is characterized by the unique phenomena where a single firm rarely has the full
range of knowledge or expertise needed for timely and cost-effective product innovation (Lam,
1997), and industry participants must cooperate, collaborate, and share proprietary information to
ensure product compatibility and acceptance (Shapiro et al., 1999). All of these qualities
combined with the fact that knowledge acquisition is path dependent – prior knowledge
acquisition enables and determines future acquisition, assimilation, and exploitation (Cohen and
Levinthal, 1989) – suggest that knowledge gaps can create significant threats to survival.
The imitability of the product in information technology also creates challenges for the
survival and growth of the firm. The legal power of patents and copyrights does not completely
protect products from imitation (Shapiro et al., 1999) and yet these are the firm’s sources of
revenue and the reasons that other firms would select them as collaborators and partners. The
firm must therefore continuously learn, replenishing and building its knowledge assets in order to
keep ahead of competitors to remain influential and viable within the industry (Hamel, 1991).
These characteristics suggest that the ability to access and acquire knowledge is a significant
factor predicting the survival of a young firm, as well as its ability to acquire knowledge
resources required for future growth.
Dynamism/Predictability
As Abernathy and Utterback (1988) have shown, the information technology industry is
dynamic because the competitive environment is characterized by frequent new product
introductions. Radical changes and technological discontinuities are often characteristics of this
environment. The technology of the product is largely unexplored, and product performance
requirements are unclear. Because the products introduced under these conditions tend to be
valued because they are satisfying a previously unidentified or unsatisfied need, product
performance rather than price is the basis of competition (Abernathy et al., 1988).
Furthermore, when new technologies are introduced, several alternatives may compete for the
market's attention before a dominant design is determined (Sorensen et al., 2000). Which
design is ultimately selected as the industry standard is affected by the strategies undertaken by
the firm, but luck can also play a role (Shapiro et al., 1999), making it difficult to predict with
certainty the directions the industry will take.
Network Effects
The predictability in the information technology industry is also impacted by network
effects (Shapiro et al., 1999). Network effects are the result of the phenomenon that, for many
information technologies, consumers benefit from employing a popular format or system. As a
result, the value of a product to one user depends on how many other users employ it. The result
is that technologies may remain dormant or exhibit very low rates of adoption followed by
explosive growth (Henderson, 1999; Shapiro et al., 1999). Furthermore, growth fuels further
adoption as the network grows and consequently makes the technology even more valuable.
3
The impact of network effects often persist due to lock-in and switching costs (Shapiro
et al., 1999). Lock-in occurs because a user adopts a particular technology which does not allow
the user to switch without abandoning the adopted technology and incurring high switching costs
in the form of dollar costs and/or learning costs (Shapiro et al., 1999). This suggests that once a
user has adopted a particular technology, preference for it is likely to persist until another
technology offers such overwhelming performing improvements that switching costs are far
outweighed by adoption advantages (Christensen, 1997; Shapiro et al., 1999).
Network effects require flexibility of the firms in industries which have them because if
they are not able to move quickly to take advantage of emerging opportunities or adapt to changes
(Abernathy et al., 1988), others will have time to establish their technologies as the network
standard and the rest will have to follow. They also magnify the risk of extensive investments in
one area of (research and development) R&D due to the uncertainty over the direction the
industry will take (Abernathy et al., 1988). On the other hand, R&D is necessary to ensure the
absorptive capacity to acquire needed knowledge resources (Cohen et al., 1989). As a result,
the ability to develop options which can be quickly exercised circumvent being left out of
technological developments which threaten the survival of the organization. Options which allow
a firm to move quickly in order to take advantage of opportunities contribute to the growth of the
firm.
Factors that Influence Survival and Growth
The factors that are proposed to be of particular influence on the survival and growth of
new information technology ventures are those that address the above characteristics. Some of
these factors impact survival and growth directly while others do so by influencing access to
resources. Although other factors such as international intensity and global diversity, the
identification of opportunities, and innovation strategies are also important to the survival and
growth of the technology venture, the paper will be confined to discussion of those factors which
address the particular characteristics of the information technology industry described above.
Knowledge Acquisition
The ability to acquire new knowledge assets is believed to be a source of competitive
advantage in all industries (Eisenhardt and Martin, 2000; Teece et al., 1997), but it is
particularly important in dynamic environments where changes are frequent and difficult to
predict. Knowledge acquisition is also important for survival and growth because the acquisition
of knowledge is path-dependent. The ability to acquire new knowledge is determined by existing knowledge (Cohen et al.,
1989). Firms which must move into an area of knowledge which is
less familiar to them than their competitors face time compression diseconomies, which means
that it will be more costly and difficult to internally develop knowledge needed to catch up to
firms that have already begun knowledge-development activities in a particular domain
(Dierickx and Cool, 1989). Thus, in a dynamic environment, the greater the access to and
breadth of existing knowledge, the less likely it is that the dynamism of the environment will
create survival issues for the venture. Furthermore, its knowledge resources will allow it to
maintain the capacity to produce leading-edge products (Sorensen et al., 2000).
Because the full range of knowledge and expertise is not contained within one firm,
ventures must access external knowledge sources in order to create and maintain the ability to
develop new products. This would be particularly true of a small and young firm which would
have fewer experts and less experienced researchers than an older, more experienced firm.
Knowledge acquisition, enhanced by social capital described below, increases new product
development and the technological distinctiveness of the firm’s products (Yli-Renko et al.,
2001). It does so because it enhances the depth and breadth of existing knowledge, thus
increasing innovative combinations, and the frequency and speed with which new products are
4
developed. Furthermore, because of the understanding of customers and markets achieved,
products which are technologically distinctive are created (Yli-Renko et al., 2001). All of these
items contribute to the growth of the organization, and suggest that the acquisition of knowledge
is of particular significance in the study of the performance of firms within the information
technology industry.
Knowledge Integration
Knowledge integration refers to the formal integration process by which managers
inventory, synthesize and use knowledge obtained from external sources (Zahra et al., 2000).
The existence of a formal knowledge transfer process is required to ensure that knowledge is
brought back and shared within the firm to encourage its integration, and to ensure its value is
fully extracted (Eisenhardt et al., 2000; Prahalad and Hamel, 1990). Furthermore, some
evidence has been found that formal knowledge sharing increases the depth of understanding,
increases the speed with which the information may be integrated, and encourages the cultivation
of broader technological learning (Zahra et al., 2000).
Knowledge integration therefore is a significant factor in whether a firm maximizes the
value it can appropriate from the knowledge it accesses and acquires, and the activities involved
in so doing warrant further investigation. It is a significant moderator of the relationship between
knowledge acquisition and new venture survival and growth because it impacts how well the
knowledge is used once it is internalized. Young firms may not have developed the routines and
capabilities required to efficiently and effectively integrate knowledge, resulting in the equivalent
of wasting scarce resources. For this reason, it is important to understand the activities and
processes of knowledge integration so that effective and efficient routines can be implemented.
Technology Strategy
There are two types of technology strategies which firms can employ – proprietary and
standards-based (Henderson, 1999). Standards-based strategy involves creating value by
exploiting currently existing standards. In employing this strategy the firm reduces some of the
mortality risk created by novelty to the market (Shepherd et al., 2000) and lack of legitimacy
(Aldrich and Fiol, 1994) as well as benefiting from network externalities (Shapiro et al.,
1999). Young firms which pursue a standards-based strategy experience higher levels of sales
growth in the early stages of their existence than those employing proprietary-based strategies.
A proprietary-based strategy emphasizes exploration and offers products whose key
technologies are internally developed and firm-specific. This strategy results in lower initial sales
growth, with higher rates of growth experienced over time than standards-based strategies
(Henderson, 1999; Zahra and Bogner, 1999). However, this strategy also involves greater
risk as it is more likely to result in failure in the years shortly after founding (Henderson, 1999).
In order to successfully pursue a standards-based technology strategy, collaboration and
cooperation with other industry participants is necessary (Shapiro et al., 1999). Knowledge
access, acquisition and integration also become important interaction terms because the
knowledge is needed in order to fully understand and create compatible products with the
standards of the industry (Shapiro et al., 1999). With a proprietary-based strategy, legitimizing
activities become a prominent factor in the survival and growth of the organization, and alliances
offer an effective means to encourage legitimacy and adoption of the firm’s technology (Aldrich
et al., 1994; Eisenhardt and Schoonhoven, 1996). Both alliances and legitimizing activities
interact with the technology strategy to impact survival and growth.
Developing Options
In a dynamic and unpredictable industry, the ability to move rapidly to take advantage of
opportunities and circumvent threats is key to ensuring organizational survival and growth. An
unpredictable environment can increase the mortality risk of a venture through negative shocks
(Shepherd et al., 2000). Two such shocks may be the introduction of a disruptive technology or a
standard/platform with which the venture is unfamiliar. However, risk reduction strategies such
as the development of options can be implemented which can also reduce mortality risk .
Entrepreneurial initiatives can be considered real options (McGrath, 1999). McGrath
(1999) proposes that these options would be treated in a similar manner to stock options in that
they would be a series of smaller investments in many smaller initiatives rather than large
investments in a few initiatives. The result is that more potential paths are created for the firm to
follow should the direction of the market change and, if an option is not exercised, the loss is
equal to the investment minus any learning or other benefits which may have been realized,
which ultimately is smaller than if large investments had been made.
Technology firms can create options by creating linkages which allow them to access and
acquire knowledge about developments within the industry (Keil, 2000). In so doing, they
obtain knowledge which gives them the flexibility and agility required of firms in a dynamic
environment. Furthermore, even if the option fails to be exercised, the cost of the failure is
reduced by the increased knowledge acquired through that option, which subsequently enhances
the search for opportunities (McGrath, 1999). Examples of a option-creating activities are
venture capital investments and alliances (Keil, 2000). By creating these linkages rather than
developing all potential paths of future technological development and knowledge internally, the
organization reduces the cost of the investment while still retaining the option to acquire the
knowledge in greater depth once the value of the option increases (Keil, 2000). In this way, the
organization ensures survival by creating the ability to circumvent the impact of technological
developments which threaten its existence, and ensures growth by creating the ability to move
quickly into rapidly developing areas that represent opportunities.
As suggested by the discussion above, it should be noted that in the information
technology industry, knowledge acquisition is an integral part of option creation, acting as an
antecedent. In order for the option to be valuable (exercisable), existing knowledge must support
the integration and deployment of new technological developments.
Legitimizing Activities
Aldrich and Fiol (1994) propose that there are two forms of legitimacy: cognitive and
sociopolitical. Cognitive legitimacy of an organization, technology, or industry refers to the level
of public knowledge and the extent to which the form is taken for granted; sociopolitical
legitimacy refers to the extent to which the element in question conforms to accepted rules and
standards. Organizations can increase cognitive legitimacy by developing the knowledge base
around a particular activity or organization through symbolic language, linkages with educational
curricula, and promotional activities through third party actors such as industry associations.
Sociopolitical legitimacy can be increased by organizing collective marketing and lobbying
efforts with other organizations, and reducing conflict and resistance from other industries and
organizations through negotiation and compromise (Aldrich et al., 1994).
Legitimacy affects the organization in two ways: it impacts access to resources (Aldrich
et al., 1994; Eisenhardt et al., 1996) and it decreases mortality risk due to market novelty
(Shepherd et al., 2000), particularly when the venture employs a proprietary rather than
standards-based technology strategy. When a firm implements a proprietary technology strategy,
in order to create network effects it must develop cognitive legitimacy (level of public
6
knowledge) by trying to encourage convergence around its design, promoting its design through
interfirm associations and advertising, and creating linkages with educational institutions (Aldrich
et al., 1994). This will impact rate of adoption and convergence which will consequently reduce
the level of mortality risk resulting from being a pioneer (Shepherd et al., 2000). In successfully
achieving legitimacy for a pioneering technology and thus encouraging its adoption, the venture
will positively impact not only its survival, but also its future growth potential because of the
impact of positive network effects described in the previous section.
Legitimacy increases access to resources which support growth. In emergence, the
organization is limited to embedded relationships in order to obtain resources because its future
potential is highly uncertain (Hite and Hesterly, 2001). As the organization enters its early
growth stage, it has survived for a sufficient time to reduce uncertainty about its future, as well as
increase cognitive and sociopolitical legitimacy (Aldrich et al., 1994), thus increasing its access to
resources (Hite et al., 2001).
Endorsements
Interorganizational endorsements also aid in creating legitimacy and therefore access to
resources because sponsorship substitutes for accomplishments when firms are young (Stuart et
al., 1999). The prominence of affiliates of young companies are employed by third parties to
make judgments about the young venture’s quality, significantly influencing the resources these
young firms are subsequently able to secure (Stuart et al., 1999). Access to resources is a
particularly contentious issue for young technology firms, impacting their ability to survive and
hindering the pursuit of growth opportunities.
Networks/Alliances
Networks/alliances play an important role in knowledge acquisition (Hamel, 1991),
provide access to resources which ultimately influence survival and growth (Eisenhardt et al.,
1996), and increase the legitimacy of the young firm (Aldrich et al., 1994 ; Eisenhardt et al.,
1996) which aids in acquiring resources, both financial and intellectual.
Networks and alliances, particularly in emergent markets, aid in increasing legitimacy by
aiding convergence around a dominant design (Eisenhardt et al., 1996), thus reducing mortality
risk (Shepherd et al., 2000). A firm can thus cooperate with others to speed the adoption of its
proprietary technology, ensuring its survival. For example, Apple’s distribution agreements with
Computerland, a growing chain of computer stores, as well as its innovative cooperative
advertising program allowed it to stretch its advertising dollars and make its product more widely
available (Moritz, 1984). Particularly when a high-reputation firm adopts an innovation, the
implicit endorsement encourages adoption by lower-reputation firms seeking to reduce
uncertainty resources to promote its own innovation can benefit from the endorsement implied
when a high-reputation organization adopts product (Abrahamson and Fombrun, 1994).
Alternatively, networks can provide useful information when a firm is pursuing a standards-based
technology strategy to ensure compatibility of its products with other technology (Shapiro et al.,
1999), thus increasing its legitimacy by complying with accepted rules and standards (Aldrich et
al., 1994).
Alliances offer access to resources, financial, managerial and knowledge (Eisenhardt et
al., 1996). By cooperating with firms which possess complementary resources and/or
capabilities, firms can take advantage of opportunities which would otherwise have been beyond
their reach due to resource constraints. Furthermore, alliances contribute to the growth of
technology ventures because the intense interaction they allow makes them an effective means of
knowledge acquisition (Dussauge et al., 2000; Mowery et al., 1996). Finally, embedded ties with
other firms promotes economies of time, making it possible to capitalize quickly on market
opportunities, and speeds data exchange (Uzzi, 1997) both of which are important for creating
growth in the dynamic and unpredictable environment of the technology firm.
Social Capital
Social capital refers to the firm’s external relationships. Although it has not been found
to be directly related to organizational performance, it has been found to be a significant
interaction factor with the firm’s internal capabilities (Lee et al., 2001), impacting how much
value is appropriated from them. Social capital is important with respect to new ventures because
it has been found to influence rates of alliance formation (Eisenhardt et al., 1996) which
subsequently impact access to resources. Social capital also enhances knowledge acquisition
through social interaction(Yli-Renko et al., 2001) and access to information (Uzzi, 1997) which
aids in timely responses to environmental developments – particularly useful characteristics in
dynamic and unpredictable industries.
The social advantages of managers are especially important in young firms that haven’t
had time to establish firm-level networks (Eisenhardt et al., 1996) and who haven’t existed for a
sufficient period of time to establish a track record (Stuart et al., 1999).
The size of the top management team, the greater number of previous same-industry
employers it has had and the higher the level of previous jobs its members have held are all
positively related to the rate of alliance formation of an organization (Eisenhardt et al., 1996)
which aid in survival and growth.
Future Research Directions
By identifying the unique characteristics of the technology industry, researchers can
focus their efforts on the particular challenges new ventures in this industry face. Many factors
which influence survival and growth have been studied employing technology-based firms,
extending our understanding of the commonalities this industry shares with others, and
determining the generalizability of results found in exploring other industries or across industries.
The most interesting findings, however, will come from results that are not generalizable
specifically because they address the unique circumstances faced by young technology firms and
the challenges these create. In so doing researchers will begin to identify the specific success
factors that these firms must employ. Only then will our understanding of the technology
industry truly be advanced.
Some of the specific questions which stem from the previous discussion are as follows:
1. Although Eisenhardt and Schoonhoven’s (1996) work has contributed to our
understanding of what qualities of the top management team aid in creating social capital
for an organization, little is known about the sources of social capital in the technology
industry. Are there other factors such as technological knowledge or experience working
within the technology industry which may be important qualities for generating social
capital in the technology industry?
2. Little is known about how firms develop options (Keil, 2000). Given their
limited resources, how can small firms create options? Can any other factors substitute
for the lack of options a small firm may have?
3. What types of endorsements are most valuable to technology firms?
Endorsements are believed to diminish in value as the firm ages (Stuart et al., 1999),
but can they be useful even for mature firms when they are introducing a new technology
that is new to the market?
4. Research has suggested that the rate of international sales growth is negatively
related to age at first entry because dominant logic hinders the development of mindsets
and knowledge required to compete internationally (Autio et al., 2000). This suggests
8
that youth may be an advantage when it comes to learning. Does this hold true for the
knowledge acquisition required to compete in technology industries? Does the age at
which a firm enters the industry impact its technological choices/development paths
because it adopts the predominant mindset which prevailed in the industry when it
entered? If disruptive technologies come primarily from organizations which are not
operating within the industry, how can a technology firm prevent or reduce the damage
these technologies do to its market? What technology and option strategies can help a
firm remain viable and current?
5. Knowledge acquisition is an important part of the technology industry. How is
technological knowledge transferred? What types of knowledge are made available to
competitors and/or collaborators? Is information and knowledge categorized into “crown
jewels” (top secret), somewhat accessible, and free for the taking? How is
information/knowledge placed into these categories? Is competitively sensitive
information available to all or are strategies used to select, share and/or protect this
information?
6. Network effects, convergence and lock-in have significant impacts on the
technology trajectories of the industry. Can endorsements and other legitimizing
activities control the direction of technological convergence? To what extent can control
be exerted? Do small firms have access to the resources needed to exert control? What
strategies can a small firm use to try and encourage convergence around its technology?
7. Proprietary strategies hold the promise of greater returns but also represent
greater risks. Under what circumstances should a small firm pursue a proprietary
technology and when does a standards-based strategy offer more promise? Does this
change with the size and age of the firm? Are there particular resources/capabilities a
young firm may have which would suggest one strategy would offer greater chances of
survival than another?
8. Is there any way to predict the technological trajectories the environment will
take? Are there any strategies that a small firm can use to overcome the disadvantages of
network effects?
These are just a few questions which I believe would be interesting to answer, and would
enhance our understanding of the technology industry. In so doing, we will better understand the
critical success factors of young technology firms, how these factors interact to predict outcomes,
and how they can be influenced by firms to ensure success and survival.

Q2. Express various models of decision making process. Describe a model which is most
suitable to your organization or any organization you are familiar with and why? Describe the
organization you are referring to.
A: Decision making can be regarded as an outcome of mental processes (cognitive process) leading
to the selection of a course of action among several alternatives. Every decision making process
produces a final choice.[1] The output can be an action or an opinion of choice. Human performance
in decision making terms has been the subject of active research from several perspectives.
From a psychological perspective, it is necessary to examine individual decisions in the context of
a set of needs, preferences an individual has and values they seek. From a cognitive perspective,
the decision making process must be regarded as a continuous process integrated in the
interaction with the environment. From a normative perspective, the analysis of individual
decisions is concerned with the logic of decision making and rationality and the invariant choice it
leads to.[2]
Yet, at another level, it might be regarded as a problem solving activity which is terminated when a
satisfactory solution is found. Therefore, decision making is a reasoning or emotional process which can be
rational or irrational, can be based on explicit assumptions or tacit assumptions.

Logical decision making is an important part of all science-based professions, where specialists apply their
knowledge in a given area to making informed decisions. For example, medical decision making often
involves making a diagnosis and selecting an appropriate treatment. Some research using naturalistic
methods shows, however, that in situations with higher time pressure, higher stakes, or increased
ambiguities, experts use intuitive decision making rather than structured approaches, following a
recognition primed decision approach to fit a set of indicators into the expert's experience and
immediately arrive at a satisfactory course of action without weighing alternatives. Recent robust decision
efforts have formally integrated uncertainty into the decision making process. However, Decision Analysis,
recognized and included uncertainties with a structured and rationally justifiable method of decision
making since its conception in 1964.

Decision making processes topics

According to behavioralist Isabel Briggs Myers, a person's decision making process depends on a
significant degree on their cognitive style.[3] Myers developed a set of four bi-polar dimensions, called the
Myers-Briggs Type Indicator (MBTI). The terminal points on these dimensions are: thinking and feeling;
extroversion and introversion; judgment and perception; and sensing and intuition. She claimed that a
person's decision making style is based largely on how they score on these four dimensions. For example,
someone who scored near the thinking, extroversion, sensing, and judgment ends of the dimensions would
tend to have a logical, analytical, objective, critical, and empirical decision making style.
Other studies suggest that these national or cross-cultural differences exist across entire societies. For
example, Maris Martinsons has found that American, Japanese and Chinese business leaders each exhibit a
distinctive national style of decision making.[4]
Some of the decision making techniques that we use in everyday life include:

• listing the advantages and disadvantages of each option, popularized by Plato and Benjamin Franklin
• flipping a coin, cutting a deck of playing cards, and other random or coincidence methods
• accepting the first option that seems like it might achieve the desired result
• prayer, tarot cards, astrology, augurs, revelation, or other forms of divination
• acquiesce to a person in authority or an "expert"
• choosing the alternative with the highest probability-weighted utility for each alternative (see Decision Analysis)

Cognitive and personal biases

Biases can creep into our decision making processes. Many different people have made a decision about
the same question (e.g. "Should I have a doctor look at this troubling breast cancer symptom I've
discovered?" "Why did I ignore the evidence that the project was going over budget?") and then craft
potential cognitive interventions aimed at improving decision making outcomes.
Below is a list of some of the more commonly debated cognitive biases.

• Selective search for evidence (a.k.a. Confirmation bias in psychology) (Scott Plous, 1993) - We tend to be
willing to gather facts that support certain conclusions but disregard other facts that support different
conclusions.
• Premature termination of search for evidence - We tend to accept the first alternative that looks like it might
work.
• Inertia - Unwillingness to change thought patterns that we have used in the past in the face of new
circumstances.
• Selective perception - We actively screen-out information that we do not think is salient. (See prejudice.)
• Wishful thinking or optimism bias - We tend to want to see things in a positive light and this can distort our
perception and thinking.
• Choice-supportive bias occurs when we distort our memories of chosen and rejected options to make the
chosen options seem relatively more attractive.
• Recency - We tend to place more attention on more recent information and either ignore or forget more distant
information. (See semantic priming.) The opposite effect in the first set of data or other information is termed
Primacy effect (Plous, 1993).
 • Repetition bias - A willingness to believe what we have been told most often and by the greatest number of
different of sources.
• Anchoring and adjustment - Decisions are unduly influenced by initial information that shapes our view of
subsequent information.
• Group think - Peer pressure to conform to the opinions held by the group.
• Source credibility bias - We reject something if we have a bias against the person, organization, or group to
which the person belongs: We are inclined to accept a statement by someone we like. (See prejudice.)
• Incremental decision making and escalating commitment - We look at a decision as a small step in a process
and this tends to perpetuate a series of similar decisions. This can be contrasted with zero-based decision
making. (See slippery slope.)
• Attribution asymmetry - We tend to attribute our success to our abilities and talents, but we attribute our failures
to bad luck and external factors. We attribute other's success to good luck, and their failures to their mistakes.
• Role fulfillment (Self Fulfilling Prophecy) - We conform to the decision making expectations that others have of
someone in our position.
• Underestimating uncertainty and the illusion of control - We tend to underestimate future uncertainty because
we tend to believe we have more control over events than we really do. We believe we have control to minimize
potential problems in our decisions.

Neuroscience perspective

The anterior cingulate cortex (ACC), orbitofrontal cortex (and the overlapping ventromedial prefrontal
cortex) are brain regions involved in decision making processes. A recent neuroimaging study,[5] found
distinctive patterns of neural activation in these regions depending on whether decisions were made on
the basis of personal volition or following directions from someone else. Patients with damage to the
ventromedial prefrontal cortex have difficulty making decisions[6].
Another recent study[7] found that lesions to the ACC in the macaque resulted in impaired decision making
in the long run of reinforcement guided tasks suggesting that the ACC is responsible for evaluating past
reinforcement information and guiding future action.
Emotion appears to aid the decision making process: Decision making often occurs in the face of
uncertainty about whether one's choices will lead to benefit or harm (see also Risk). The somatic-marker
hypothesis is a neurobiological theory of how decisions are made in the face of uncertain outcome. This
theory holds that such decisions are aided by emotions, in the form of bodily states, that are elicited during
the deliberation of future consequences and that mark different options for behavior as being
advantageous or disadvantageous. This process involves an interplay between neural systems that elicit
emotional/bodily states and neural systems that map these emotional/bodily states.[8]

Styles and methods of decision making

Styles and methods of decision making were elaborated by the founder of Predispositioning Theory, Aron
Katsenelinboigen. In his analysis on styles and methods Katsenelinboigen referred to the game of chess,
saying that “chess does disclose various methods of operation, notably the creation of predisposition—
methods which may be applicable to other, more complex systems.”[9]
In his book Katsenelinboigen states that apart from the methods (reactive and selective) and sub-methods
(randomization, predispositioning, programming), there are two major styles – positional and
combinational. Both styles are utilized in the game of chess. According to Katsenelinboigen, the two styles
reflect two basic approaches to the uncertainty: deterministic (combinational style) and indeterministic
(positional style). Katsenelinboigen’s definition of the two styles are the following.
The combinational style is characterized by

• a very narrow, clearly defined, primarily material goal, and

• a program that links the initial position with the final outcome.

In defining the combinational style in chess, Katsenelinboigen writes:

The combinational style features a clearly formulated limited objective, namely the capture of material
(the main constituent element of a chess position). The objective is implemented via a well defined and in
some cases in a unique sequence of moves aimed at reaching the set goal. As a rule, this sequence leaves
no options for the opponent. Finding a combinational objective allows the player to focus all his energies
on efficient execution, that is, the player’s analysis may be limited to the pieces directly partaking in the
combination. This approach is the crux of the combination and the combinational style of play.[9]
The positional style is distinguished by
 • a positional goal and
• a formation of semi-complete linkages between the initial step and final outcome.

“Unlike the combinational player, the positional player is occupied, first and foremost, with the elaboration
of the position that will allow him to develop in the unknown future. In playing the positional style, the
player must evaluate relational and material parameters as independent variables. ( … ) The positional
style gives the player the opportunity to develop a position until it becomes pregnant with a combination.
However, the combination is not the final goal of the positional player—it helps him to achieve the
desirable, keeping in mind a predisposition for the future development. The Pyrrhic victory is the best
example of one’s inability to think positionally.”[10]
The positional style serves to
a) create a predisposition to the future development of the position;
b) induce the environment in a certain way;
c) absorb an unexpected outcome in one’s favor;
d) avoid the negative aspects of unexpected outcomes.
The positional style gives the player the opportunity to develop a position until it becomes pregnant with a
combination. Katsenelinboigen writes:
“As the game progressed and defense became more sophisticated the combinational style of play declined.
. . . The positional style of chess does not eliminate the combinational one with its attempt to see the
entire program of action in advance. The positional style merely prepares the transformation to a
combination when the latter becomes feasible.”[11]
Q3) Explain the process of conflict. Discuss the impact of conflict on the performance of an organization you are
working in or any organization you are acquainted with. Describe
the organization you are referring to.

A:
What is a conflict & why does it occur ?
The oxford dictionary defines conflict as " disagreement between people with different ideas or beliefs, it also defines it as
" a fight or a struggle". Having understood what is conflict, let us spend a bit of time to dwelve our thoughts on - Is conflict
undesirable or bad ?. To my mind conflict is a natural part of life, I call it natural because no two individuals are same. An
organisation, is but a collection of people from different cultural backgrounds, they have different sets of values and ideas.
Individuals look at situations or probems in organisational life from their unique perspective, which is a result of the
circumstances within which they have grown.

Causes of conflict :
Differing values (eg conservative v/s progressive minded)
Differing perspectives (eg limited v/s broad, domestic v/s international)
Differing ideas (creative v/s mundane)
Different styles of solving organisational problems.
Differing agendas (sometimes hidden ones)
Differing attitudes (rigid v/s flexible)
Differing objectives and goals.
Differing circumstances.
How to manage conflicts in an organisation :
Let us simulate the situations under which the conflicts occur in an organisation. Basically there could be three situations
in an organisational context.

1. Conflict with the boss.

2. Conflict with colleagues/peers.
3. Conflict with subordinates

1. Managing conflict with the boss :

All of us have read the famous rule,
Rule no. 1 Boss is always right.
Rule no. 2 In case the boss is wrong see rule no. 1.

This is not to say that one has to be yes man all the time. When ever you face a conflict situation with your boss consider
the following approaches.

(i) Appreciate wider perspective : The boss has wider perspective than you, therefore please consider whether there is
something you are not able to visualise that your boss has visualised?
(ii) Do not offend his authority : Every boss is sensitive to maintaining his authority. If you have a better idea, put it in a
manner of suggestion, avoid offending his authority.
(iii) Evaluate the impact : Very carefully evaluate the impact of the wrong decision of the boss on your position in particular
and on organisation in general. Do not challenge his decision unless you have to.
(iv) Avoid bitterness : If you have to differ with your boss, just register your point of view without making it bitter.

2. Managing conflict with peers/colleagues :

Most of the times the conflict between peers occurs because of the tendency of " One up manship". When ever you face a
conflict situation with your colleagues, try some of the following approaches.
(i) Communicate: Most of the time your colleagues may be differing with you, either because they have not understood
your point of view properly or you have not communicated clearly enough. Since you do not have any authority over them,
enter into a dialogue and discuss the issue with an open mind.
(ii) Conflict to Co-operation : Work towards skillfully converting conflict in to a co-operation. Strive to appreciate their point
of view. Find out the ways and means to create a 'win-win' situation. If need be ammend your approach and meet your
colleagues midway.
3. Managing conflicts with the subordinates :
In this situation you have the authority, yet you have to be skillful in managing the conflict.
(i) Allow freedom to express : Give adequate freedom to your subordinates to express their views freely, be patient listen
to them carefully.
(ii) Allow dissent : Dissent is natural, manage disagreement constructively
(iii) Build consensus : Identify the +ve minded persons in your team and convert them into the 'champions of causes' and
let them reason it out with the ynical fellows. Provide right kind of support, intervene skillfully to build consensus.
(iv) Develop a common vision : Appreciate the fact that all your subordinates may not have the broad vision and
perspective like yours. Its your responsibility to share your dreams and aspirations for the organisation with them and
make them appreciate these. Through discussion, training and counseling develop a common vision.

TEN (GENERIC) APPROACHES TO MANAGE CONFLICTS

1. Patient listening.
2. Empathy, understand other's point of view.
3. Avoid reacting strongly / avoid anger under all circumstances.
4. Evaluate your responses properly before responding.
5. Communicate, enter into a dialogue, convince or get convinced.
6. Choose the right time for dialogue, when the other person is in a receiving mood.
7. Avoid throwing your weight, even if you have the authority.
8. Allow dissent, manage disagreement constructively,
9. Build consensus, take people along.
10. Create a common vision if others do not have as broad a perspective as your, explain it to them with patience, train
them & counsel them.
4) Explain various channels of communication. Describe the importance of grapevine
communication. Illustrate from an organization you are familiar with. Describe the
organization you are referring to.
A:

Communication

Communication is the passing on of ideas and information. In business we need good, clear communication. The contact
may be between people, organisations or places and can be in a number of forms such as speech, writing, actions and
gestures. Organisations need to be structured in such a way as to maximise the benefits of communication processes.
This is why team structures are so useful because they open up a multi-flow channel of communications.

Up until the 1980's many large firms in America and Western Europe were characterised by top-down communications
systems.

Communication flowed down the line i.e. instructions were passed down the line. Individuals at the bottom end of the
system had little scope for decision making.

However, modern communication systems stress the importance of empowerment, and multi-flow communications:
There are a range of media for flows of communication in a modern organisation including:
team briefings
team discussions
meetings
informal talk
e-mail
discussion boards, etc.
Large organisations like Corus and Travis Perkins recognise the importance of multi-channel communications and have
therefore created team working structures. Teams are organised into multi-disciplinary groups in order to draw on a range
of expertise. The teams are encouraged to make decisions rather than to wait for commands from above.
Multi-channel communications
Formal communications are those that involve the officially recognised communication channels within an organisation.
Informal communication involves other forms of interactions between organisational members.
Good communication is an important person to person skill in an organisation. Employees are most likely to be well
motivated and to work hard for organisations where there are well organised multi-directional communication flows.
Communication flows in a number of directions:
Downward communication involves the passing of commands from higher levels in a hierarchy to lower levels. This is
sometimes referred to as top-down communication.
Upward communication involves the feedback of ideas from lower down in the organisation to higher levels. This sort of
communication flow is important in the consultation of employees, and enables managers to draw on good ideas from
those working at grassroots levels in an organisation.
Sideways communication involves the exchange of ideas and information between those at the same level in an
organisation e.g. between the various functions.
Multi-channel communication involves a range of flows of information. Information and Communications technology and
the resultant networking systems enable effective multi-channel communication.
There are all sorts of ways of organising effective communications between members of an organisation:
Team briefings - enable team leaders and managers to communicate and consult with their staff. Team briefings may take
place on a daily basis or less frequently.
Formal meetings - enable a more formalised approach to communication.
Face-to-face communications enable a free and frank exchange of ideas.
There are many other ways of communicating such as e-mail, electronic noticeboards, physical noticeboards, newsletters,
phone, fax, videoconferencing etc.
The type of communication channel used needs to be appropriate to the message being conveyed. For example, if an
exchange of ideas is required some sort of face-to-face meeting will be most appropriate. The communication of
information can be done by newsletter, or notice board. Team working encourages a range of different types of
communication and can be to high levels of motivation.
Types of Communication
Verbal
Oral
Written
E-mail
Nonverbal
Expression
Expressive behaviors
Body language
Communication Distinctions
Formal/Informal
Official/unofficial information exchange
Vertical/horizontal
Superior-subordinate/peers
Personal/impersonal
Situation of mutual influence/exchange without mutual influence
Instrumental/expressive
Necessary for job/nonjob information transmission
Sender-Receiver Model: Each single communication 5 steps
message formation
message encoding
message transmission
message reception
message decoding
PATHWAY BETWEEN 2 PEOPLE- INTERACTION OCCURS
PERCEPTION AND INTERPRETATION FORM FILTERS FOR MESSAGES
Creates potential for communication breakdown:
Result=miscommunication
USE SIMPLICITY, CLARITY, APPROPRIATE TIMING,
RELEVANCE, ADAPTATION TO CIRCUMSTANCES, AND
CREDIBILITY
Communication Networks
Wheel
Y
Chain
Circle
All-channel
Effectiveness of Communication
Related to timing
Related to choice of channel
Related to message structure
Related to delivery style
Related to mode
NURSING AND HEALTH CARE COMMUNICATION IS COMPLICATED BY JARGON!
List a Few!
FEEDBACK
Related to communication
Related to morale
Sequelae of delegation
FEEDBACK LOOP
FEEDBACK AND CRITICISM
Both constructive/negative criticism exist
Use feedback constructively to improve individual and team productivity and performance
Affects morale, motivation and team cohesiveness
Leader directed feedback is powerful tool in shaping behavior of team as team
Four Types of Feedback
Clarifying
restating instructions, making sure there is no confusion
Interpretive
involves making observation of the team’s behavior
Judgmental
involves drawing conclusion in form of value judgment
Personal reaction
gives information about your personal feelings
Practice Giving Feedback to the Following:
1. In your family planning clinic, one of the assistants who also performs secretarial work has decided to
telephone the patients their HIV test results before consulting with you, the RN who generally counsels patients
about these issues.
2. A medical assistant has been discussing confidential information about patients in the coffee room.
3. Maria, the nursing assistant on the night shift at the long-term care center, routinely complains about having to
turn patiens who are “just going to die anyway.”
4. You have observed a new colleague drawing blood without using gloves. Someone needs to talk with her.
Communication Strategy: Responding to Criticism
Ask for more information
Agree with the critic
Use listening skills to guide the critic toward the real problem source
CONSTRUCTIVE CRITICISM
Not focused on blame
Not person’s characteristic, attack, defamation of character
Focused on an analysis of the problem
Positive critiquing includes:
BALANCING THE POSITIVES AND NEGATIVES
POINTING OUT PROBLEMS AND SOLUTION OPTIONS
Appearance and behavior combine to add to the total communication
ORGANIZATION COMMUNICATION
Group dynamics
Multiple people, influence, personalities, politics
Types of information transmission, flow of formal and informal information
(e.g. RIFs, rules, charges, liabilities)
Six Areas of Organizational Communication Problems
Accessibility of information
Communication channels
Clarity of messages
Span of control
Flow control/communication load
Individual communicators
SPECIFIC COMMUNICATION PROBLEM AREAS
Verbal abuse
Sexual harassment
Communication Styles
Passive
Aggressive
Passive-aggressive
Assertive
Communication Intervention Techniques
Assertive communication
Shift your focus
Create a positive open attitude
State your perception
Establish mutual goals
Use of “I” messages
Incorporate balance
Include strengths, review contributions
Solicit feedback
GRAPEVINE
The formal network, made up of memos, reports, staff meetings, department meetings, conferences, company
newsletters and official notices is highly documented and as such has very little chance for change. However, nearly all of
the information within the grapevine is undocumented and is thereby open to change and interpretation as it moves
through the network. It often travels faster than formal channels. The grapevine is very useful in supplementing formal
channels. It provides people with an outlet for their imaginations and apprehensions as well. It also helps satisfy a natural
desire to know what is really going on. The primary objective of this article is to develop a conceptual model to be tested
later. The article defines tile term rumor/grapevine, discusses reasons for grapevine, exploreshow accurate is grapevine,
type of grapevine, how grapevine is spread, role of various participants and how to manage the grapevine. Dealing
effectively with the grapevine is a challenge that will always be a part of a manager's job. Those who are able to
understand the power of the grapevine will be better prepared to utilize it to provide stability and credibility in the work
environment that is needed in order to achieve organizational goals.
The dictionary gives us a definition for the grapevine which says it is "the informal transmission of information, gossip or
rumor from person to person" The grapevine is the informal and unsanctioned information network within every
organization. "The network helps employees make sense of the world around them and consequently provides a release
from emotional stress and all informal information is undocumented. "[1] Keith Davis (one of the leading authors on the
subject) discovered in his study that organizational Grapevine is an expression of healthy human motivation to
communicate: "In fact, if employees are so uninterested in their work that they do not engage in shoptalk about it, they are
probably maladjusted."[2] Of all the things that the grapevine has been called, it is foremost--a communications network.
Since it is unstructured and not under complete control of management, it moves through the organization in every
direction. "It moves upwars, downward, and diagonally, within and without chains of command, between workers and
managers, and even with and without a company."[3]
The term grapevine can be traced to Civil War days when vinelike telegraph wires were strung from tree to tree across
battlefields and used by Army Intelligence.[4] The messages that came over these lines were often so confusing or
inaccurate that soon any rumor was said to come from the grapevine. Usually, grapevines flow around water coolers,
down hallways, through lunch rooms, and wherever people get together in groups.[5] The lines of communication seem to
be haphazard and easily disrupted as the telegraph wires were, however, they transmit information rapidly and in many
cases faster and with a stronger impact than the formal system allows.
Location of the Grapevine
Since the grapevine arises from social interactions, it is as fickle, dynamic, and varied as people are. It is the expression
of their natural motivation to communicate. It is the exercise of their freedom of speech and is a natural, normal activity.
The grapevine starts early in the morning in the car pools. once everyone has arrived at work, grapevine activity takes
place nearly all day long down hallways, around corners, in meetings, and especially by the coffee machine. The peak
time of the days are breaks and lunch hour during which management has little or no control over the topics of
conversation. In the late afternoon the work day has finished but the grapevine has not. After a short time interval, some
employees meet again. They are on company softball teams, golf leagues, and bowling teams. The grapevine at that time
goes into full swing again and remains active with one final activity peak at a local bar. The following day, the cycle is
repeated. It is the wide range of locations where the grapevine takes place in combination with the fact that grapevine
participants come from informal social groups within the organization which points out it's difference from formal
management communication. Structured management uses verbal messages to communicate through the chain of
command, while grapevine communication jumps from one department to another and from any level of management to
another. It moves up, down, horizontally, vertically and diagonally all within a short span of time. The grapevine, as
communication, can be compared to the organizations formal information network.
Formal vs. Informal Channels of Communication
Every organization has a formal communication system. This formal system provides information regarding the
organization to the employees through different media. The formal network, made up of memos, reports, staff-meetings,
department meetings, conferences, company newsletters, official notices, is highly documented and as such has very little
chance for change. However, nearly all of the information within the grapevine is undocumented and is thereby open to
change and interpretation as it moves through the network. "The informal organization is less permanent and less stable
(than the formal organization) because its leaders and patterns of action change readily."[6] This occurs because of the
dependency of the network on personalities, whereas the formal network is set up through structured policies
nondependent on individuals.
Keith Davis did a classic study of the grapevine in 1953. This was followed by an extension of the research by Harold
Sutton and Lyman Porter in 1968. Keith Davis stated "the grapevine is a natural part of a company's total communication
system...it is a significant force within the work group, helping to build teamwork motivate people, and create corporate
identity."[7] The grapevine is the informal passing of information through the organization. It does not necessarily follow
the formal structure of the organization and can bypass individuals without restraint. It can be more direct and faster than
the formal channels of information since the information is not being screened or controlled.[8] It often travels faster than
formal channels. Interestingly, it has been found that the grapevine is equally active both in management and among the
workers. The grapevine exists in organizations for many reasons. Grapevine communication can carry useful information
through the organization with amazing speed. The grapevine is very useful in supplementing formal channels. It provides
people with an outlet for their imaginations and apprehensions as well. It also helps satisfy a natural desire to know what
is really going on and gives employees a sense of belonging. As an early warning system, gossip allows people to think
through in advance what they will do if the rumors become the awful truth. Subordinates may get an idea of what the boss
is wrestling with and may have some suggestions, which may help the situation.
The grapevine is flexible and personal and can spread information faster than the formal communication channels. The
grapevine is also capable of penetrating even the tightest security because it cuts across organizational lines and deals
directly with people in the know. Bosses who chose not to pay attention to the grapevine have 50% less credible
information than those who do. Khandwalla states that it exists because of excessive structuring of formal work flows and
the excessive channeling of information flows.[9] It is fed by personal apprehension, wish fulfillment, retaliation, and
gossip.[10] Surprisingly, most researchers have found that most grapevine information is either true or has within it a
kernel of truth.
Reasons for Grapevine Communications
Grapevines exist in all organizations in varying degrees. Gordon Allport describes two conditions as controlling activeness
of the grapevine; importance of the subject to the speaker and listener, and the ambiguousness of the facts.[11] He relates
the two with the following formula:
R = IA
Where:
R is the intensity of the rumor
I is the importance of the rumor to the persons communicating, and
A is the ambiguity of the facts associated with the rumor.
This formula, according to Allport, means that the amount of rumor in circulation will vary with the importance of the
subject to the individuals concerned times the ambiguity of the evidence pertaining to the topic at issue. The relation
between importance and ambiguity is not additive but multiplicative, for if either importance or ambiguity is zero, there is
no rumor.[12] This formula is supported by Donald B. Simmons who states it slightly differently. He states "rumors
originate, grow, and spread along the grapevine in direct proportion to their importance to workers and the lack of news on
a subject from official channels."[13]
How Accurate is the Grapevine?
Allport and Postman's research indicated that "most rumors start as a report of an actual episode - that is to say, with
someone's perceptual experience of an event which he deems of sufficient interest and importance to communicate to
others.[14]
Once this central theme, the actual episode, has been accepted there is a tendency to distort subsequent news or events
in order to make them consistent with the central theme. However, Keith Davis reports from his research "that in normal
business situations between 75 percent and 95 percent of grapevine information is correct."[15]
In general people tend to think the grapevine is less accurate than it is because its errors tend to be more dramatic and
consequently are more impressed on one's memory than its day-to-day routine accuracy.
In a normal work situation, upwards of 80% of the information that comes over the grapevine is accurate.[16] While the
day-to-day accuracy may be good, people believe the grapevine is less accurate because the times it is wrong are more
dramatic. A communication may be 90% correct in details but that last 10% is often the most important part of the
message. Messages from the grapevine are often lacking in all the details so that the message is subject to
misinterpretation; while the grapevine generally carries the truth it seldom carries the whole truth.
An interesting note about the informal communications network is that an estimated 80% of grapevine information is
oriented toward the individual while 20% concerns the company.[17]
Allport and Postman discuss, in their book, the changes that occur as a rumor passes along the grapevine. The central
theme may be resistant to change, however crucial details necessary for understanding the true situation keep being
deleted. (They call the process "levelling. ") At the same time the most dramatic details keep being exaggerated each time
the rumor is repeated. (This they refer to as "sharpening. ") So as the rumor moves along it begins to appear as some sort
of shrinking missile as it keeps getting shorter and more pointed in flight[18]
This may sound very simple, however we should remember that " the grapevine is fast-paced and generally moves, free
of organizational restraints, by word of mouth."
Factors Affecting Grapevine's operation
Several additional factors affect the operation of the grapevine. First, in wartime, the conditions for rumor are optimal.
Military events are of the greatest importance. Second, the greater the homogeneity of the organization, the better the
grapevine will operate. Third, rumors prosper best where formal communication is poor. They thrive in an environment
where employees are not kept informed about anything that my be important to them. Fourth, they perform best in
informal social contacts but can operate as effectively as a sideline to official meetings. In a poorly managed organization
they can chip away at morale and fuel anxiety, conflict, and misunderstanding.[21] Fifth, people start and spread rumors to
enhance their status, fill gaps in social conversations, and avoid suspense over suspected events. [22]This activity
increases during times of stress, uncertainty, and in the absence of news.
Frederick Koenig[23], a sociologist who studies rumors, believes that people listen to and pass a rumor because it
satisfies some need. This is why the nature of people involved is important. Different people have different needs and
rumors ...
a) may circulate because they are interesting or a source of diversion. The valve can be the content of the message or the
state of the group.
b) can pull together events and fill in the gaps to make sense and provide explanations for what is going on.
c) can validate and support a point of view
d) reconcile one's psychological state with what one sees as actually going on. (Studies show people who are high in
anxiety are more frequent participants in the rumor process and groups in stressful situations have more rumor activity.)
e) are a means of getting attention..
f) are a way of manipulating situations. The idea of some person or group deliberately starting a rumor to serve selfish
ends is frequently suggested.
Types of Rumors
We will now take a look at the types of rumors that travel the grapevine. But, before we look at the types we should be
aware of the two overall classifications that apply to all rumors. These are explained by Roy Rowan.[24] The two
classifications are: Spontaneous rumors and Premeditated rumors.
Spontaneous rumors appear during periods of stress and thrive in an atmosphere of anxiety, mistrust, repression of utter
chaos. These rumor die as soon as they become irrelevant.
On the other hand, premeditated rumors, as might be expected, are often planted for Machiavellian purposes, particularly
in highly competitive environments.
Rumors that fall into both classifications have been witnessed travelling along most companies' grapevines. However, the
spontaneous rumor is seen most often as facts are pieced together to explain an occurrence.
Research has determined that much of what the grapevine carries is rumors. These rumors can be concerning any
practice or policy of the company or about any person in the company. Rumors can be divided into four (4) categories.
The first category is that of the "wish fulfillment or pipe dreams:"
Pipe dreams or wish fulfillment - these express the wishes and hopes of those who circulate rumors and these are the
most positive and they help to stimulate the creativity of others. often solutions to work problems are a result of employees
verbally expressing desire for changes. These improvements sometimes result in increased efficiency for certain
departments within the organization. Even though the tone is positive they still represent employee concerns.
The second category is that of the "anxiety," or "bogie," rumor:
The Bogie rumor - comes from employees' fears and anxieties causing general uneasiness among employees such as
during budget crunch. In this case, employees will verbally express their fears to others. These rumors are sometimes
damaging, such as a rumor about possible lay-offs, and need a formal rebuttal from management.
The majority of rumors fall into the category of the "aggressive rumors, " or "wedge drivers," or "Motel Six" types of
rumors:
Wedge Drivers - divide groups and destroy loyalties. They are motivated by aggression or even hatred. They are divisive
and very negative rumors. They tend to be demeaning to a company or individual and can cause damage to the
reputation of others. A wedge driver rumor may be someone at x Company saying that v Company serves worms in their
hamburgers; or in another context, a school-age child telling friends that another child has AIDS, or some other tale, like
"Louise, the office manager, was seen the other day alone with that young new accountant. They were in a car together
leaving Motel Six." or one may spread the word that "Mary got the promotion because she is sleeping with the boss."
Women are more likely to be attacked with the sexual gossip.
Home-Stretchers - These are anticipatory rumors. These rumors occur after employees have been waiting a long time for
an announcement. There may be just one final thing necessary to complete the puzzle and this in effect enhances the
ambiguity of the situation.
Now that we have discussed why the grapevine exists, the accuracy of the information on the grapevine and the types of
rumors that exist, we will look at how the message is spread and those who participate.
How is the word spread?
Within the organization communication chains exist. The chain used by formal communication may be very rigid, following
the chain of command or authority. However, the chain used by the grapevine tends to be very flexible. Four different
chains/structures appear to dominate the grapevine network according to Keith Davis are:
1. The Single Strand Chain This is a simple concept to follow, A tells B, who tells C, who tells D and so on. Each person
passes the information on to the next person. The longer the strand the more distortion and filtering affects the information
being passed until the last person in the chain may find the information unrecognizable from the original message. Most
inaccuracies occur in this chain.
2. The Gossip Chain: In this illustration A simply tells everyone with whom they come in contact. This pattern is considered
to be somewhat slow in moving the information.
3. The Probability Chain: In this case A makes random contact with say F and C and passes on the information. They in
turn randomly contact others in accordance with laws of probability. Some hear the information and some don't. In this
structure, there is no definite pattern of communication. Information is randomly passed along to anyone willing to listen.
They type of person who communicates in this manner might be a very outgoing and talkative type of individual.
4. The Cluster Chain: Here A tells contacts, B and F, who may work with A. They may tell two or three other persons with
whom they usually have close contact. Most predominant pattern is the cluster pattern. Selectivity is the basis for this
pattern. In any organization, individuals will generally feel more comfortable with some fellow employees than with others
and therefore only relay information to those in their informal social groups. This flow pattern results in information missing
some individuals completely.
Roles of the Participants
In addition to identifying certain structured patterns, research has also given us some other facts and descriptions, It has
been discovered that only 10% of all the individuals in an organization are highly active participants in the grapevine. The
types of individuals relative to rumors, have been identified. The three are bridgers, baggers, and bearers. Most
employees fall into one of the three (3) basic categories as they relate to the grapevine.
1. Bridgers or Key Communicators - Bridgers or key communicators receive and pass information to others. These people
are the ones primarily responsible for the success of the grapevine. Bridgers[25]--are the passers-along; the liaisons of
rumors, also called KC's, as explained by Sutton. "Key Communicator" is the term that is given to this type of individual
who is responsible for initially sending information into various networks.
2. Baggers or Dead Enders - Baggers hear rumors but do not pass them along or fail to tell others. They are called "dead-
enders." They receive information but do not pass it on or only pass it on to one or maybe two other dead-enders.
3. Beaners or Isolates - Beaners, or isolates, are not privy to any information, do not hear the information and thus cannot
pass along, a rumor. They tend to be outside the grapevine. They neither hear nor pass along the information.
Each type of individual can easily be identified in the communication mains previously illustrated. It should also be noted
that people are more active on the grapevine when their friends and colleagues are actively involved.
After all that has been said about the grapevine the next questions that arise are: What should the company managers do
about the grapevine? Is it good or bad? Should the managers participate? How do we manage the grapevine?
Management's Response to the Grapevine
The key thing to remember is that the grapevine exists, William A. Delaney reminds us of this when he says the
"grapevine exists, always has and always will, and you can't stop it." So managers should accept the fact and decide how
they can use it to their own benefit.
Vanessa Arnold contends that "Managers interested in creating effective organizational communication will use
information from the grapevine to improve communication throughout the firm."[26]
The real value of the grapevine should be in revealing to management those issues that generate from the grass roots. As
Donald Thompson said "its usefulness is seldom acknowledged, its voice often muffled, its insights ignored."[27]
Should Managers Participate?
In many cases lower and middle managers are already active participants. They hold strategic positions in the
communication channel because they filter and block two-way communication between higher management and
operating employees.[28]
Managers basically have three options when it comes to their participation in the grapevine:
1. Ignore the grapevine, be no part of it. This is difficult in most organizations, but can be accomplished. They do their job
and let it operate unnoticed around them. In effect they become an "isolate. "
2. Participate only when it serves their purpose. In this case they may seek out the grapevine and tap it to learn what is
being said concerning a specific situation or issue.
3. Become an active and full-time participant.
Coping or Managing the Grapevine
Since the grapevine cannot be held responsible for errors and is somewhat of an unknown, managers sometimes
succumb to the wish that it will go away; but we have learned from experience and research that "homicide" will not work
with the grapevine. It cannot be abolished, rubbed out, hidden under a basket, chopped down, tied up, or stopped. If we
suppress it in one place it will pop up in another. If we cut off one of its sources, it merely moves to another one...It is as
hard to kill as the mythical glass snake, that, when struck, broke itself into fragments and grew a new snake out of each
piece. In a sense, the grapevine is a human birthright, because whenever people congregate into groups, the grapevine is
sure to develop. It may use smoke signals, jungle tom-tome, taps on a prison wall, ordinary conversation, or some other
method, but it will always be there. Organizations cannot "fire" the grapevine because they did not hire it. It is simply
there.
Positive Aspects
Even though management does not always view it favorable, the grapevine has several positive aspects. One major
advantage of the grapevine is that it is a release mechanism for stress. Bottled-up feelings have been proven to have
negative side effects for individuals and the grapevine helps to ease this type of situation. We know individuals like and
need to talk about their work. It's and important part of one's life, The grapevine provides a soapbox for individuals to talk
about this important facet of their lives. In talking about work, the grapevine gives employees the opportunity to convert
official company policies into their own language or jargon. In doing this, individuals are better able to understand the
policies and are better able to cope with their work environment. This open communication also enables employees to
have empathy for those who are occurring stress outside of the work place. As stronger personal bonds occur among
workers, a greater spirit of team work exists within the organization.
Because of the speedy transfer of information, the grapevine enables individuals to prepare for and think through
management's goal changes and goal adjustment in advance of any formal statements. This increases the contributions
of employees. The grapevine also helps employees to remain efficient by quickly spreading the news of disciplinary
action. If tardiness is a problem and one person is given a day off without pay, will management be able to remind
everyone immediately of company policy? Probably not. Will a memo from the Personnel Department reach everyone that
same day? That isn't likely to happen either. However, will the grapevine make sure everyone's at work on time the next
day? oh, yes!
Additionally, the grapevine is a good indicator of health, morale, trends, and productivity. The grapevine reveals issues
and problems being discussed by the employees; the effect of policies and procedures upon which the employees can be
measured. Managers should have some means of tapping into the grapevine. The grapevine is also a means of
communication which a manager can use for efficiency. Via this method, desired information can be circulated quickly to a
large group of subordinates. Control of the grapevine is an understated responsibility of the manager. While all the
information passing through is not initiated by management, management is ultimately responsible for its accuracy.
Management Options
Internal rumors are generally managed differently than external rumors if for no other reason than management of a
company has more control over internal formal communication than over information sent out to the external environment.
Since grapevine activity increases during times of uncertainty, management must provide information through the formal
system of communication about key issues and events that affect employees. Management should supply employees with
a steady flow of accurate, timely information; in this way, the potential damage caused by the grapevine can be
minimized. Any attempt to soften or distort a rumor to make things look good is not a good way to deal with the rumor. The
longer a rumor circulates the more difficult it is to control. Facts should be released quickly. The grapevine can be
controlled with prompt, clear, and accurate information on the issues important to the employees. Full facts must be
presented. Formal communication lines must be kept open and the process as short as possible. Direct memos, large
group announcements, and intercom systems should be used. If employees perceive management is giving them the
facts, they will be less anxious and less emotional when rumors are heard.
Although the preferred management option is prevention, this never works 100% of the time. In other words, there will be
negative rumors and if one wants to manage them, one ought to be prepared. So when prevention doesn't work, and it
won't, what can one do? Two methods are suggested. First, a four-step method, and second, a disciplined three-phase
management program, Generally, in the four-step method, four steps are suggested:[29]
1. Seek to keep employees informed about what is going on. A formal company newsletter always seems to help.
2. Heed rumors. Listen to what is being said that is 80% true. What other information source is so highly credible?
3. Act promptly. Rumors are more difficult to correct over time because they "harden"--the details become consistent and
the information becomes publicly accepted,
4. Conduct a training program for employees on the nature of rumors.
For the wedge drivers and the bogies, although prevention is the preferred method of management. This will fail
sometimes. When it does, a rather disciplined, three-phase management program can be used incorporating both the
tapping of the grapevine and the active management of the formal communications channels.[30]
Phase I. Active gathering of information regarding the rumor.
1. Ascertain extent of rumor's circulation. Can you be at a distant friend's retirement party and hear a bad rumor about
your company. ..or...Do you merely receive a roomful of laughs when you walk into your service club's monthly meeting?
2. Collect facts. Recalling that 80% of rumors are true, corporate leaders at Upjohn discovered that rumors about massive
kickbacks to foreign governments by its international division were true. It is thus wise to look, or at least know, where one
is leaping.
3. Assess sources of uncertainty and anxiety. Rumors are a product of someone's anxiety. That rumors in response to
uncertainty, it seems logical to determine what the uncertainty is all about.
Having done all of Phase I, make a decision as to whether the rumor will die on its own merits or whether it will continue to
the detriment of the company. If it is decided that the rumor will continue, proceed to the second phase.
Phase II. Prepare for a public response through the development of an information dissemination plan.
1. Prepare a formal response, With external rumors, the company does not control the channels of communication. This is
left to journalists, reporter, and announcers. Preparing a formal response that provides an opportunity to access the
various mass media is absolutely crucial to even getting in the front door, front page, or six o'clock news.
2. Begin work on preparing an information dissemination plan. This plan is to directly counter-attack the public rumor, now
generally to the point of public fact, in a direct and intentional way.
Before proceeding to Phase III, review again whether the rumor will die of its own weight, silliness, or irrelevancy, or really
is becoming a nuclear cloud over your company, It is to the point of not being able to go away on its own, you may decide
to implement the plan developed in Phase III.
Phase III. Implement the plan.
Besides the above two methods, i.e., a) four-step method, and b) a disciplined three phase management program, the
authors feel that tapping of the grapevine is also important. First of all, management can try to identify and make use of
key communicators. Management can leak out important information to key communicators or bridgers who actively
transmit information. By participating, management can monitor what is happening in the organization and discover the
reactions of its employees.
The grapevine can be used to see how a new idea will be received. If feedback through the grapevine indicated an
unfavorable reaction, management can reconsider the idea or alter it to lessen employee resistance. If the new idea is
incorporated, management will be forewarned of problems and can be prepared with new programs to help overcome
anxiety and misperceptions. In short, as an early warning system, rumors allow management to think through in advance.
John Kotter, a Harvard Business School professor and author of "Power and Influence, " gives an example of a manager
he knows who uses the grapevine to give new ideas a "trial-run" before spending a great deal of time and money. "He
knows who in the office has the longest tongue," explains Kotter. He than casually mentions this new idea to the employee
and waits for the word to spread. In no time, responses find their way back to his secretary, who gives him a full report.
Feedback is very important, and if it is positive, he goes ahead with the new plan. If the feedback is negative, it's back to
the drawing board to rethink the idea and pinpoint the problem areas. The simple, cheap way to check an idea can be
invaluable to a manager.
Some organizations create a rumor hotline or rumor control office. [31] When an employee hears a rumor he can call the
rumor office to check it out. By providing this service, bad rumors can be replaced with good rumors. Good rumors, such
as "I asked about that and was told it wasn't so," move just as quickly through the grapevine as bad ones, and can
increase morale, help build teamwork, and increase motivation.[32] Dealing effectively with the grapevine is a challenge
that will always be a part of a manager's job. Those who are able to understand the power of the grapevine will be better
prepared to utilize it to provide stability and credibility in the work environment that is needed in order to achieve
organizational goals.
5) Explain different leadership styles. Is there any difference between successful and an
effective leader? Discuss with suitable examples from an organization you are familiar
with. Describe the organization you are referring to.
A:
There are different types of leadership styles... such as
1) Charismatic
2) Participative
3) Situational
4) Quiet Leader
5) Transactional
6) Trasformational
1) Charismatic Leader
A leader who is able to captivate his audience and create an ardent following for himself, through his charisma. This
charisma is exercised in his attitude, his speech, reflected well in his addressings to his followers. His followers are
usually so loyal and dedicated that they follow him wherever he leads them. His charisma, of course, is the most
enchanting part. Eg. Bill Clinton.
2) Transformational Leader
The leader who is able to change the existing attitude, thoughts and beliefs of the populace. The people could have
developed such attitudes that hamper their growth and development and the leader steps right in, to change their way of
living, or working, giving them a new reason, hope and stance. This leader does not expect his followers to blindly follow
him. In fact, he empowers them to think different act different, think new and act new. Eg. Martin Luther King, Mahatma
Gandhi
Though I know the rest vaguely, I do not quite know them completely. Hence, I prefer not to elaborate on them. But I am
sure that you would find better explainations and examples on the net. These leadership styles are very popular.
There are a number of different approaches, or 'styles' to leadership and management that are based on different
assumptions and theories. The style that individuals use will be based on a combination of their beliefs, values and
preferences, as well as the organizational culture and norms which will encourage some styles and discourage others.
Charismatic Leadership
Participative Leadership
Situational Leadership
Transactional Leadership
Transformational Leadership
Transformational Leadership
The Quiet Leader

Leadership Styles

Modern leadership demands an ability to adapt one's style to achieve the maximum effectiveness. Rather than using
one's own preferred style, excellent leaders are able to take different approaches to suit the various needs of differing
situations.
This page describes a popular model of leadership styles, that can be used as the basis for leadership training or
individual coaching. A modern leader will:
develop flexibility and adaptability to be able to use any of the styles
recognise the different demands of each situation
use the style(s) that will give optimum success
The table below describes each of the styles, and gives examples when the style should or should not be used.
Leadership styles When to use When not to use

ACTIVE BLUE
ESFJ/ENFJ, Extraverted Feeling (Jung), or Coach (MTR-i)

People-oriented, motivator, builds personal Commitment from others is Decisions need to be forced
relationships, likeable, interpersonal skills, critical, or sensitive situations through, conflict is being avoided
cares for others

REFLECTIVE BLUE
ISFP/INFP, Introverted Feeling (Jung), or Campaigner (MTR-i)

Value-driven, has passion for key issues, The group has lost its sense of There is a problem that needs to be
focuses on important themes, champions identity, or it is doing too many solved with dispassionate
the cause unimportant things objectivity (eg: technical issues)

ACTIVE GREEN
ENTP/ENFP, Extraverted Intuition (Jung), or Explorer (MTR-i)

Tries things that are new, prototypes, The group is 'stuck in a rut', or There are already too many
introduces change, looks for unexpected the status quo needs to be initiatives under way and some
outcomes, creates new opportunities, challenged stability is needed
experiments

REFLECTIVE GREEN
INTJ/INFJ, Introverted Intuition (Jung), or Innovator (MTR-i)

Develops long term vision, produces radical Radical change is needed, There are immediate dangers,
ideas, foresees the future, anticipates what is change is a long term activity the group may not survive in the
outside current knowledge short term

ACTIVE YELLOW
ESTP/ESFP, Extraverted Sensing (Jung), or Sculptor (MTR-i)
 Takes action, produces results, leads from There is some inertia, or lack of The group is being too
the front, sets an example, does what is achievement has destroyed expedient, current success may
asked of others motivation ebb in the future

REFLECTIVE YELLOW
ISTJ/ISFJ, Introverted Sensing (Jung), or Curator (MTR-i)

Observes, listens, clarifies goals, establishes The direction is vague or There are already too many
realistic expectations, makes aims crystal expectations have not been goals or too much information
clear articulated

ACTIVE RED
ESTJ/ENTJ, Extraverted Thinking (Jung), or Conductor (MTR-i)

Organises, makes plans, sets measurable There is chaos/lack of There are so many processes
goals, coordinates work of different people, organisation, or there are no that creativity has been stifled
manages resources measures of achievement

REFLECTIVE RED
ISTP/INTP, Introverted Thinking (Jung), or Scientist (MTR-i)

Analyses, uses models, produces The situation is complex or People's feelings are
explanations, compares other situations, driven by technical solutions paramount, or the group go
engages in intellectual debate round in circular arguments
Conclusion/summary
This model of leadership styles can be used to increase the effectiveness of a leader. The key to success is developing
the external awareness of what is required, and the internal flexibility to be able to access each style as appropriate.