SUGGESTED ANSWERS MODEL PAPER 1 of 6

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TotaI Marks = 80
Q.2 Case of BIue Bird Company (BBC):
Answer 1:
Inappropriate selection of the Marketing Manager, (Mr. Salman). Mr. Salman is not
originally a marketing person; rather he is a sales person and having no relevant
professional experiences. As being a marketing manager at CI he did not perform the
job professionally. The first significant mistake he committed was that he did not conduct
any sort of market research. Due to this he could not have any clear idea of the market.
He had to conduct market research than make and marketing moves according the
market requirements. His only focus was on making the boss happy not the customer.
Second, the Cuisine Island was positioned as upper tier dining restaurant but he started
to target young college and university student. Again without any research support.. In
the TV ad he targeted young college and university students (which was neither the
actual target market nor a relevant segment for the restaurant; which was positioned as
a premium one). Message through the advertisement would have caused a messed up
positioning in the mind of consumer.
Answer 2:
First of all MR Dinar made a wrong decision i.e., the manager purchasing ( Mr. Munir)
was As HR manager he violated the staffing policy of CI , which was that BBC will hire
employees on merit .
In the turbulent times, when CI was facing a great deal of challenges, Mr. Denar should
have hired a manger having HR related professional experience. Hiring Mr. Salman was
even a wrong organizing decision.
Second, Mr. Munir did not did not believe that qualification was a valid criterion for
selecting restaurant employees. He did not give importance to qualification; experience
etc, rather his main selection criteria was how strongly the existing employees had
referred him. Third, Mr. Munir did base his recruitment and selection decisions on merit;
furthermore he showed clear cut biases in his decisions. This act of the HR manager
was straightly contradictory to newly crafted plan
Third, Trainings is very critical in such business as services comprise around 50 percent
of a restaurant s market offering. MR Munir did not provide any sort of orientation and
training to his newly hired employees, his wrong beliefs that training and development
are expense, a genuine HR manger always considers it as investment. MR Munir had to
continuously asses the training needs of employees, provide them relevant training and
then place them on their jobs.
Fourth, the HR manager could not ensure external equity in managing compensation
because he was not aware industry s prevailing wage rate. For competent employees
this would result in pay dissatisfaction and may lead to employee turnover (especially
competent employees).
SUGGESTED ANSWERS MODEL PAPER 2 of 6
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Answer 3:
TQM requires high level of customer focus and continuous improvement in all process
of the organization at all organizational levels. Through reading the case one can find
that there was hardly any importance given to customer satisfaction However in the new
plans made to deal with problematic and challenging situation BBC developed to an
extent customer orientation. But at ht implementation level the decisions of HR manager
and Manager totally went opposing the plan. TQM can never be implemented in such an
organisation which considers training and development as expense. To implement TQM
program in its real spirit organization should have a learning culture.
Answer 4:
Mr. Dinar should revisit his decisions by and considering :
Appointing a new professional competent HR manager in place of Mr. Munir. Mr.
Munir is sent back to his prior position for which he has got experience.
Appointing a new marketing manager for CI, as the existing marketing manager
in a suitable person for looking after marketing of such type of restaurant in
difficult situation.
Ensuring that employees are hired on merit for high performance.
Properly orienting and training employees (after determining their training needs)
Ensuring that all managers at all levels work with high level of customer
orientation.
As Metro Cinema is overstaffed, Mr. Dinar should make it appropriately staffed.
This will reduce the unnecessary financial burden on BBC.
Q.3 (a) Effectiveness is often described as doing the right things that is doing those work
activities that will help the organization to reach goals. Efficiency refers to getting the
most output from the least possible amount of resources.
ExpIanation
All organization practice management to accomplish organizational mission through
attainment of goals. In this connection activities are performed by people in the
organization and resources are used. This very important in connection to the goal
accomplishment ; that to what extent the activities performed are right (appropriate) ,
performed in right way , and at a right time. Through this it can be determined that to
what extent the goals probably be achieved.
Secondly in connection to the use of organizational resources the amount of resource
uses to attain goals matter a lot. If an organization attains goals by employing more
resources, or wasting the resources the productivity of the organization will be low. If an
SUGGESTED ANSWERS MODEL PAPER 3 of 6
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organization attains goals by employing least possible resource ensuring as compared
to competitors subject to cont compromising on effectives, the organization can edge
over competitor which if further can lead the organization to gain competitive advantage
over competitors.
(b) The balanced scorecard focuses on four different perspectives.
ExpIanation/ Measures:
Gives rise to targets that matter to customers: cost, quality, delivery, inspection,
handling and so on.
Aims to improve internal processes and decision making.
Considers the business s capacity to maintain its competitive position through
the acquisition of new skills and the development of new products.
Covers traditional measures such as growth, profitability and shareholder value
but set through talking to the shareholder or shareholders direct.
The scorecard is balanced in the sense that managers are to think in terms of all four
perspectives, to prevent improvements being made in one area at the expense of
another.
Q.4 (a) The global business environment can be analysed against a number of factors, such as
political, economic, social/cultural and technological. This is known as PEST analysis.
There will be differences between different countries.
PoIiticaI and LegaI
Political risk is the risk of an organization incurring losses due to non-market factors.
These factors are usually related to government policy, for example trade rules,
investment incentives and the tax regime.
Political risk is also related to financial factors such as currency controls and the
economy, and stability factors such as rioting and civil war.
Corporate Political Activity (CPA) refers to the involvement of companies in the political
process with the aim of influencing policies towards their preferences.
Organizations may need to deal with governments and perhaps make their policy
preferences known in a number of situations. Examples include:
(a) MuItinationaI companies from developed countries may negotiate terms for
their investment in that country. For example finance, taxation and export
agreements.
(b) MuItinationaIs may lobby governments to provide conditions in the economy
that benefit them. For example reducing restrictions or controls over labour such
SUGGESTED ANSWERS MODEL PAPER 4 of 6
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as working hours and minimum wages. The MNC may threaten to withdraw its
investment if the government fails to agree.
(c) New industries in developing nations may seek protection from their
government, for example import restrictions.
(d) DeveIoping industries may seek government support such as subsidies or tax
breaks to help them compete in the global market.
(b) Lean Production:
Lean production is a manufacturing methodology developed originally for Toyota. It is
also known as the Toyota Production System. Its goal is to get the right things to the
right place at the right time, the first time, while minimising waste and being open to
change .
Benefits of Lean Production:
Supporters of lean production believe it enables a company to deliver on demand,
minimise inventory, maximise the use of multi-skilled employees, flatten the
management structure and focus resources where they are most effective.
Other benefits include:
Waste reduction (up to 80%)
Production cost reduction (50%)
Manufacturing cycle times decreased (50%)
Labour reduction (50%) while maintaining or increasing throughput
Inventory reduction (80%) while increasing customer service levels
Capacity increase in current facilities (50%)
Higher quality
Higher profits
Higher system flexibility in reacting to changes in requirements improved
More strategic focus
Improved cash flow through increasing shipping and billing frequencies
Criticisms of Lean PrincipIes:
In many situations, organizations supposedly using lean principles have not experienced
the improvements in productivity and profitability expected. It is difficult to know whether
this is due to shortcomings in the lean philosophy or whether the techniques involved
are being interpreted and applied correctly.
For example, the 5Ss concept should be used with the aim of creating a workplace with
real organisation and order which creates pride by employees in their work, improves
safety and results in better quality. However, in some organisations 5S has become a
cleaning and housekeeping exercise only.
SUGGESTED ANSWERS MODEL PAPER 5 of 6
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Lean techniques should be seen and treated as outward signs of a more fundamental
approach to operations and quality. Real improvements require a change in thinking and
in culture which are difficult to achieve.
Many companies use lean manufacturing and Six Sigma techniques to reduce costs,
rather than a fundamental commitment to eliminating waste and adding value.
Q.5 (a) Managers can exercise the following controls as per the conditions given in the
question:
Feedforward ControI: to control an activity before it begins
Concurrent ControI: to control an activity when it is going on
Feedback ControI: to control an activity after it is completed
Feedforward control prevents problems because it takes place before the actual activity
begins. This control focus on taking action before a problem occurs. Concurrent Control
takes place while a work is in progress, another term for this control is management by
walking managers can benefit from using this control because it can help them correct
problems before they come too costly. Feedback control is the most popular type of
control that relies on feedback. In this control, the control takes place after an activity is
done. [ examples X 3]
(b) Job redesign, rotation, enIargement and enrichment can all be used to improve the
motivation of employees by introducing changes to their work.
(a) Job redesign aims to improve performance through increasing the
understanding and motivation of employees. Job redesign also aims to ensure
that an individual s job suits them in terms of what motivates them and their need
for personal growth and development.
(b) Job rotation allows for a little variety by moving a person from one task to
another. Employees often do this spontaneously. Job rotation permits the
development of extra skills, but does not develop depth of skill.
(c) Job enIargement increases the width of the job by adding extra, usually related,
tasks. It is not particularly popular with workers, many of whom prefer
undemanding jobs that allow them to chat and daydream.
(d) Job enrichment increase the depth of responsibility by adding elements of
planning and control to the job, therefore increasing its meaning and challenge.
The worker achieves greater autonomy and growth in the role.
Hackman and Oldham developed the job characteristics model that sets out the links
between employee motivation, satisfaction and performance (including personal growth)
SUGGESTED ANSWERS MODEL PAPER 6 of 6
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and the characteristics of their job or role.
Five core characteristics:
(a) SkiII variety: the breadth of job activities and skills required
(b) Task identity: whether the job is a whole piece of work with a visible outcome
(c) Task significance: the impact of the job on other people
(d) Autonomy: the degree of freedom allowed in planning and executing the work
(e) Feedback: the amount of information provided about the worker s job
performance.
Q.6 (a) Customer of today is bombarded by commercial messages form a broad range of
sources. But customers do not distinguish between message sources the marketers do.
In consumer s mind messages from different media and promotional approaches all
becomes part of a single message about the company. Conflicting messages from these
sources can result in confused company images, brand positions and customer
relationships. Due the reason mentioned above today more and more companies are
adopting IMC. Under this concept:
The company carefully integrates the many communication channels to deliver a
clear, consistent message about thee organization and its brands. Company
recognizes all touch points where the customer may encounter the company and
its brands.
The company ties together all of the company s messages and images. For
instance the company s television and print advertisements have the same
message look.
(b) The Buyer Decision Process:
The buyer decision process consists of five stages:
Need recognition: the first stage of the buyer decision process, in which the
consumer recognizes a problem or need.
Information search: the stage of the buyer decision process in which the
consumer is aroused to search for more information; the consumer may simply
have heightened attention or may go into an active information search.
AIternative evaIuation: the stage of the buyer decision process in which the
consumer uses information to evaluate alternative brands in the choice set.
Purchase decision: the buyer s decision about which brand to purchase.
Post-purchase behaviour: the stage of the buyer decision process in which the
consumers take further action after purchase, based on their satisfaction or
dissatisfaction.
THE END