07: Effective Organizing and Organizational Culture

Avoiding Mistakes in Organizing by Planning
Lack of design in an organization is illogical, cruel, wasteful and inefficient.

Planning for the IdealThe search for an ideal organization to reflect enterprise goals under given circumstances is impetus to planning. The ultimate form established, like all other plans, seldom remains unchanged, and continuous remolding of the ideal plan is normally necessary. Nevertheless, an ideal organization plan constitutes a standard, and by comparing the present structure with it, enterprise leaders know what changes should be made when possible. An organizer must always be careful not to be blinded by popular notions in organizing, because what may work in one company may not work in another.

Modification for Human Factor
If available personnel do not fit into the ideal structure and cannot or should not be pushed aside, the only choice is to modify the structure to fit individual capabilities, attitudes, or limitations. Although modification may seem like organizing around people, in this case one is first organizing around the goals to be met and activities to be undertaken and only then making modification for the human factor.

Advantage of Organization Planning
Planning the organization structure helps determine future personnel need and required training programs. Furthermore organization planning can disclose weakness such as, duplication of effort, unclear lines of authority, and overlong lines of communication.

Avoiding Organizational Inflexibility
One basic advantage of organization planning is the avoidance of organizational inflexibility. An effective organization must have the ability to adapt to a changing environment and meet new contingencies. This resistance to change can cause considerable loss of efficiency in organizations.

Avoiding inflexibility through Reorganization
Although reorganization is intended to respond to changes in the enterprise environment, there may be other compelling reasons for reorganization.
1. Change in operations caused by the acquisition or sale of major properties, change in product line or marketing method, business cycle, competitive influences, new production techniques, labor union policy, government regulatory and fiscal policy.
2. Moreover, a new chief executive officer and new vice presidents and department head are likely to have some definite organizational ideas of their own.
3. Furthermore, reorganization may be caused by demonstrated deficiencies in an existing structure. Some of these arise from organization weaknesses: excessive spans of management and committees, lack of union policy, slow decision making, failure to accomplish objectives, inability to meet schedules, excessive cost or break down of financial control.
The need for readjustment and changeIn addition to pressing reasons for reorganization, there is a certain need for moderate and continuing readjustment merely to keep he structure from becoming stagnant.

Making Staff Work Effective
The line-staff problem is not only one of the most difficult that the organizations face but also the source of an extraordinarily large amount of inefficiency. Solving this problem requires great managerial skills, careful attention to principles, and patient teaching of personnel.

Understanding Authority RelationshipsManagers must understand the nature of authority relationships if they want to solve the problems of line and staff. As long as the managers regard line and staff as groups of people or grouping activities, confusion will result. The line relationship involves making decisions and acting on them. The staff relationship, on the other hand, implies the right to assist and counsel. In short line may “tell”, but staff must “sell”.

Making Lines Listen to Staff
Line managers should be encouraged or required to consult with the staff. Enterprises would do well to adopt the practice of compulsory staff assistance wherein the line must listen to staff.

Keeping Staff Informed
Many criticisms arise because staff assistants are not kept informed on matters within their field.

Requiring Completed Staff Work
Many staff persons overlook the fact that in order to be most helpful, their recommendations should be complete enough to make possible a simple positive or negative answer by a line manager. Staff assistants should be problem solvers and not problem creator. Completed staff work implies presentation of a clear recommendation based on full consideration of problem, clearance with persons importantly affected. Should a recommendation be accepted, through staff work provides line managers with the machinery to put in into effect. People in staff positions who learn to do these things can find themselves highly valued and appreciated.

Making Staff Work as a Way or Organizational Life
Wherever staff is used, its responsibility is to develop and maintain a climate of favorable personal relations. A staff assistant should not attempt to assume credit for an idea. Not only is this a sure way of alienating line teammates who do not like being shown up by staff assistant, but operating managers who accept ideas actually bear responsibility for the implementation of the proposals. Companies also employ the outside assistance of professional firms. In such case, it is difficult to hold outside staff accountable when those staff people are not involved in the implementation of their recommendations.

Avoiding Conflicts by Clarification

A major reason for conflict in organizations is that people do not understand their assignments and those of their co-workers. No matter how well conceived an organization structure may be, people must understand it to make it work. Understanding is aided materially by the proper use of organization charts, accurate job descriptions, the spelling out of authority and informational relationships and the introduction of specific goals for specific positions.

Organization Charts
Every organization structure, even a poor one, can be charted.
Advantages of Organization Charts: Though it is arguable that, charts tends to make people overly conscious of being superiors or inferiors, tend to destroy team feeling also, if an organization is left uncharted, it can be changed more easily, organization charting is required because of essential reporting relationships. Without charting is like, preparing a way for politics, intrigue, frustration, buck-passing, lack of co-ordination, duplicated effort, vague policy, uncertain decision making, and other evidences of organizational inefficiency. Since a chart maps lines of decision-making authority, sometimes merely charting any organization can show inconsistencies and complexities and lead to their correction.
Limitation of Organization Charts: A chart shows only formal authority relationships and omits the many significant informal and informational relationships. It does not show how much authority exists at any point in the structure. Many time managers hesitate or neglect or redraft charts, forgetting that organization structures are dynamic and that charts should not be allowed to become obsolete. Another difficulty is that individuals may confuse authority relationship with status (salary and bonus levels).

Position Description
Every managerial position should be defined. A good position description informs every one of the incumbent’s responsibilities. It must states the basic function of the position, the major end-result areas for which the manager is responsible, and the reporting relationships involved. Description also clarifies the position’s authority, and it states the set of verifiable objectives for the end-result areas. Its benefits include analyzing jobs, duties and responsibilities, identification of areas of neglecting or overlapping duties. Also benefits include the guidance they provide in training the new managers, in drawing up candidate requirements, and in setting up salary levels. Finally it is a means of control over the organization. It gives standards against which to judge a position is necessary and, if so, what its organizational level and exact location in the structure should be.

Ensure Understanding of OrganizationAll members of an enterprise must understand the structure of their organization in order for that structure to work.

Teaching the Nature of Organizing 
A well written organization manual – containing a statement of organization philosophy, programs, charts and an outline of job descriptions – goes far towards making organizing understandable.

Recognizing the Importance of Informal Organization and GrapevineAnother way of making the formal organization work effectively is to recognize and take full adavantage of informal organization.
The Grapevine
Informal organization tends to exist when members of a formal organization know one another well enough to pass on information – sometimes only gossip – that is some way connected with the enterprise. Since all forms of informal organization serve essential human communication needs, the grapevine is inevitable and valuable.
Advantages Informal Organization brings a kind of cohesiveness to formal organization. Many managers, understanding this fact, consciously use informal organizations as channels of communication and molders of employee moral.

Promoting an Appropriate Organization Culture
The effectiveness of an organization is also influenced by the organization culture, which affects the way the managerial functions of planning, organizing, staffing, leading and controlling are carried out.

Defining Organization Culture
Culture is general pattern of behavior, shared beliefs, and values that members have in common. Culture can be inferred from what people say, do, and think within an organizational setting. It involves the learning and transmitting of knowledge, beliefs, and patterns of behavior over a period of time, which means that an organization culture is fairly stable and does not change fast. It often sets the tone for the company and establishes implied rules for the way people should behave. Many slogans give a general idea of what a particular company stands for.

Influence of the Leader on Organization Culture
Managers, especially top managers, create the climate for the enterprise. Their values influence the direction of the firm. Although the term “value” is used differently, a value can be defined as fairly permanent belief about what is appropriate and what is not that guides the actions and behavior of employees in fulfilling the organizational aims. Value-driven corporate leaders serve as role models, set the standards for performance, motivate employee, make the company special and are a symbol to the external environment. While a CEO must indicate the direction, some contend that change must come from the bottom of the organization. Changing a culture may take a long time, even five to ten years. It demands changing values, symbols, myths and behavior. It may require understanding the old culture. A clear vision of a common purpose elicits commitment. Espoused values need to be reinforced through reward and incentives, ceremonies, stories, and symbolic actions.

06: Line/Staff Authority, Empowerment, and Decentralization

Authority and Power
Power, a much broader concept than authority, is the ability of individuals or groups to induce or influence the beliefs or actions of other person or group. Authority in an organization is the right in the person (and through it, the right of the person occupying the position) to exercise discretion in making decisions affecting others. Although there are many different bases of power, the power of primary concern in this book is legitimate power e.g. a traffic officer who gives a traffic ticket. Power may come from expertness of a person or a group e.g. power of knowledge. Physicians, lawyer may have considerable influence on others because they are respected for their special knowledge. Power may further exist as referent power, that is, influence that people or groups may exercise because people believe in them and their ideas e.g. politician, film stars or military hero. Inreward power, people exercise considerable influence through their ability to expedite or delay in required action. Coercive power is still another type. Although closely related to reward power and normally arising from legitimate power, it is the power to punish, whether by firing a subordinate or withholding a merit increase. While organization authority is the power to exercise discretion in decision making, it almost invariably arises from the power of position, or legitimate power.

Empowerment

Empowerment means that employees, managers, or teams at all levels in the organization have the power to make decision without asking their superiors for permission. The notion underlying empowerment is that those closest to the task are best able to make the decision – provided they have the required competencies. Conceptually,
1.Power should be equal to responsibility (P=R)
2.If power is greater than responsibility (P>R), then this could result in an autocratic behavior of the superior who is not held accountable for his or her actions.
3.If responsibility is greater than the power (R>P), then this could result in frustration of subordinates because they do not have the necessary power to carry out the task for which they are responsible.
Some of the reasons for the interest in empowerment are global competitiveness, the need to respond fast to the demands and expectations of customer. Empowerment of subordinates means that superiors have to share their authority and power with their subordinate. Thus, an autocratic leadership style, when used as the only why to manage, is often inappropriate for twenty-first-century organization. Most employees want to be involved and want to participate in decisions, which, in turn, create a sense of belonging, achievement, and self-esteem.
Effective management requires that empowerment is sincere, is based on mutual trust, provides employees with relevant information to carry out their task, and is given to competent people.

Line/Staff Concepts and Functional Authority

Line authority gives a superior a line of authority over a subordinate. The Scalar Principle in organization is: The cleaner the line of authority from the ultimate management position in an enterprise to every subordinate position, the clearer will be the responsibility for decision making and the more effective will be he organization communication. It therefore becomes apparent from the scalar principle that Line Authority is that relationship in which superior exercises direct supervision over a subordinate – an authority relationship in direct line or steps. The nature of the Staff Relationship is advisory. The function of people in a pure staff capacity is to investigate, research, and give advice to line manager. Functional Authority is the right that is delegated to an individual or department to control specified process, practices, policies or other matters relating to activities undertaken by person in other departments.

Decentralization of Authority
The Nature of Decentralization

Decentralization is the tendency to disperse decision making authority in an organized structure. It is fundamental aspect of delegation; to the extent that authority is not delegated, it is centralized.
Different Kinds of Centralization1. Centralization of Performance pertains to geographic concentration; it characterizes, for example, a company operating in a single location.
2. Departmental Centralization refers to concentration of specialized activities generally in one department. For example, maintenance for a whole plant may be carried out by single department.
3. Centralization as an aspect of management is the tendency to restrict delegation of decision making. A high degree of authority is held at or near the top by managers in the organizational hierarchy.

Decentralization as a Philosophy and Policy

Decentralization implies more than delegation; it reflects a philosophy of organization and management. It requires. It requires a careful selection of which decisions to push down into the organization structure and which to hold near he top.

Delegation of Authority
Authority is delegated when a superior gives a subordinate discretion to make decisions. The process of delegation involves determining the results expected from a position, assigning tasks to the position, delegating authority for accomplishing these tasks and holding the person in that position responsible for the accomplishment of the task.

The art of DelegationMost failures in effective delegation occur not because mangers do not understand the nature and principles of delegation but because they are unable or unwilling to apply them. Delegation is in a way an elementary act of managing.

Personal Attitudes toward Delegation
1. Receptiveness: An underlying attribute of managers who will delegate authority is a willingness to give other people’s idea a chance.
2. Willingness to let go: if the size or complexity of the organization forces delegation of authority, manager should realize that there is a “law of comparative managerial advantage” (same as law of comparative economic advantage, which states that, a country’s wealth will be enhanced if it exports what it produces most efficiently and imports what it produces least efficiently.
3. Willingness to let others make mistakes: Continual checking on the subordinate to ensure that no mistakes are ever made will make true delegation impossible. Since everyone makes mistakes, a subordinate must be allowed to make some, and their cost must be considered an investment in personal development. Serious or repeated mistakes can be largely avoided without nullifying delegation.
4. Willingness to trust subordinates: Superiors have no alternative to trusting their subordinates, for delegation implies a trustful attitude between them. This trust is sometimes hard to come by.
5. Willingness to establish and use broad controls: More often than not, reluctance to delegate and to trust subordinates comes from the superior’s inadequate planning and understandable fear of loss of control.

Overcoming Weak DelegationFollowing practical guides will facilitate a successful delegation:
1. Define assignments and delegate authority in the light of result expected.
2. Select the person in the light of the job to be done.
3. Maintain open lines of communication.
4. Establish proper controls.
5. Reward effective delegation and successful assumption of authority.

Recentralization of Authority and Balance as the key to decentralization
Recentralization is normally not a complete reversal of decentralization, for authority delegations are not wholly withdrawn managers who made them.

05: Organizational Structure: Departmentation

The grouping of activities and people into departments makes organization expansion possible. Departmentation can be done by enterprise function, by territory or geography, and by the kind of customers served. Other kinds of departmentaion are the product organization grouping, matrix or grid organization, project organization, and the strategic business units (SBU)

Patterns of Departmentation

At the outset, it must be emphasized that there is no single best way of departmentizing that is applicable to all organizations or to all situations.

Departmentation by Enterprise Function

Functional departmentation embodies what enterprises typically do. The basic (manufacturing) enterprise functions are engineering, production, sales or marketing and financing.
Often, these particular functional designations do not appear in the organization chart. First, there is no generally accepted terminology. Second, basic activities often differ in importance. E.g. hospitals have no selling departments and churches no production department.
Functional departmentation is the most widely employed basis for organizing activities and is present in almost every enterprise at some level in the organizational structure.

Departmentation by Territory or Geography

Territorial departmentation is especially attractive in sales and productions to large-scale firms or other enterprises whose activities are physically dispersed. On the other hand finance, is concentrated at the headquarters. This is used mostly in Govt. organizations.

Customer Departmentation

Grouping activities so that they reflect a primary interest in customers is common in a variety of enterprises.

Departmentation by Product

Grouping activities on the basis of products or product lines has been growing in importance in multiline, large-scale enterprises. With the growth of the firm, production managers, sales and service managers, and engineering executives encountered the problems of size. The managerial job becomes complex. At this point, reorganization on product basis becomes necessary. This structure permits top management to delegate to division executive extensive authority over the manufacturing, sales, service, and engineering functions that relate to a given product line and to exact a considerable degree of profit responsibility from each of these mangers.

Matrix Organization

Another kind of departmentation is matrix or grid organization or project or product management. However, pure project management need not imply a grid or matrix. The essence of matrix organization normally is the combining of functional and project or product patterns of departmentation in the same organization structure. This form has been common in engineering and in research and development; it has also been widely used although seldom drawn as a matrix, in product marketing organization. This kind of organization occurs frequently in construction, in aerospace, in marketing.

Strategic business units (SBUs)

Companies have been using an organizational device generally referred to as a Strategic Business Units (SBU). SBUs are distinct little business set up as units in larger company to ensure that a certain product or product line is promoted and handled as thought it were an independent business.
An SBU must:

1. Must have its own mission, distinct from the mission of the mission of other SBUs.
2. Must have definable groups of competitors
3. Prepare its own integrative plans, fairly distinct from those of other SBUs
4. Manage its resources in key area
5. Have a proper size, neither too large nor too small.

Thus SBU is given its own mission and goals, as well as manager who, with the assistance of a full time or part time staff, will develop and implement strategic and operating plans for the product. The major benefit of utilizing an SBU organization is to provide assurance that product will not get “lost” among other products in a large company. It is thus an organizational technique for preserving entrepreneurial attention and drive. In fact, it is an excellent means of promoting entrepreneurship, which is likely to be lacking in large company.

Potential problems with SBUs

Companies should invest in the core competencies of the firm. Allocation of resources to individual SBUs can result in underinvestment in core competencies which is benefit to the total organization. Also SBU mangers may not be willing to share talented people and may hide them rather than lend them to another SBU.

Organizational structure for the global environmentdepends on a variety of factors, such as the degree of international orientation and commitment. It may vary greatly, ranging from having an export department at the headquarters to regional groupings, with many various in between. In addition, companies may have also one or more functionally organized groupings within a region.

Virtual Organization is a loose concept which gains access to another firm’s competence, to gain flexibility, to reduce risk, or to respond rapidly to market needs. Clearly there are many unanswered questions surround the virtual organization.

Boundaryless Organization is open, anti-parochial environment; friendly towards the seeking and sharing of new ideas, regardless or their origin. The purpose of this initiative was to remove barriers among the various departments as well as between domestic and international operations.

Choosing the Pattern of Departmentation

There is no one best way of departmentizing that is applicable to all organizations and all situations. The most appropriate pattern depends on various factors in given situation. These factors include the kind of job to be done, the way the task must be done, the kinds of people involved, the technology, the people served and the other internal and external considerations.

1. The aim is to achieve objectives. Departmentation is not an end in itself but is simply a method of arranging activities to facilitate the accomplishment of objectives. The main concerns must be the type of organizational environment that the manager wishes to design and the situation being faced.
2. Mixing types of Deparmentation. The objective of departmentation is not to build a rigid structure, balanced in terms of levels and characterized by consistency and identical bases, but to group activities in the manner that will best contribute to achieving enterprise objectives. If a variety of bases does this, there is no reason why manger should not take advantage of the alternatives before them. But sometime this logic is ignored may be because to make an organization chart look pretty or to maintain control, specialist often insist that all departmentized activities below the primary level of organization be group in exactly the same manner.

04: The Nature of Organizing, Entrepreneuring and Reengineering

Good people and those who want to cooperate will work together most effectively if they know the parts they are to play in any team operation and the way their roles relate to one another. This is true in business or government as it is in football or in a symphony orchestra. Designing and maintaining these systems of roles is basically the managerial function of organizing.

Managing of Organizing and Organization

In addition, to make a role work out effectively, provision should be made for supplying needed information and other tools necessary for performance in that role. In this sense that we think of Organizing as,

1. The identification and classification of required activities.
2. The grouping of activities necessary to attain objectives.
3. The assignment of each grouping to a manager with the authority (delegation) necessary to supervise it.
4. The provision for coordination horizontally and vertically.

An organization structure should be designed to clarify who is to do what task and who is responsible for what results, to remove obstacles to performance cause by confusion and uncertainty of assignment, and to furnish decision-making and communications networks reflecting and supporting enterprise objectives.

The term Organization implies a formalized intentional structure of roles or positions.

Formal and Informal Organization

Formal Organization means the intentional structure of roles in formally organized enterprise.
Informal Organization is a network of personal and social relations not established or required by the formal organization but arising spontaneously as people associate with one another.
Organizational Division: One aspect of organizing is the establishment of departments. The word department designates a distinct area, division or branch of an organization over which a manger has authority for the performance of specified activities.

Organization Levels and the Span of Management

While purpose of organizing is to make human cooperation effective, the reason for levels of organization is the limitations of the span of management. In other words, organization levels exist because there is a limit to the number of persons a manager can supervise effectively, even though this limit varies depending on situations. A wide span of management results in few organizational levels, and a narrow span results in many levels.

Problems with Organization Levels

The division of activities into departments and hierarchical and creation of multiple levels are not complete desirable in themselves.
First, levels are expensive. Accountants refer to such costs as “overhead” or “burden” or “General and Administrative” in contrast to so called direct costs. Real product is accomplished by factory, engineering or sales employees, who are, or could logically be accounted for as “direct labor”. Levels above the “firing line” are predominantly staffed with managers whose cost it would be desirable to eliminate.
Second, department levels complicate communication. An enterprise with many levels has greater difficulty communicating objectives, plans and policies downward through the organization structure than does a firm in which the top manger communicate directly with employee. Omission and misinterpretations occur as information passes down the line. Levels also complicate communication from the firing line to the commanding superiors, which is every bit as important as downward communication.
Finally, numerous department and levels complicate planning and control.

Operational Management Position: A situational Approach

Principle of span of the management states that there is a limit to the number of subordinates a manager can effectively supervise, but the exact number will depend on the impact of underlying factors. (This include the degree of training of subordinates that is required and possessed, the clarity of authority delegation, the clarity of plans, the use of objective standards, the rate of change, the effectiveness of communication techniques, the amount of personal contact needed and the level in the organization) Examining what consumes the time of managers in their handling of superior-subordinate relationships and ascertaining devices that can be used to reduce these time pressures will be not only a helpful approach for determining the best span in individual case but also a powerful tool for finding out what can be done to extend the span without destroying effective supervision.

Factors determining an Effective Span

Apart from such personal capacities as comprehending quickly, getting along with people, and commanding loyalty and respect, the most important determinant is manager’s ability to reduce the time he or she spends with subordinates. This ability naturally varies with managers and their jobs, but several factors materially influence the number and frequency of such contacts and therefore the span of management.

Need for Balance

What is required is more precise balancing. One must balance all the costs of adopting one course or the other, not only thefinancial costs but also costs in morale, personal development and attainment of enterprise objectives.

An Organizational Environment for Entrepreneuring and Intrapreneuring

The essence of entrepreneurship is innovation, that is, goal-oriented change to utilize the enterprise’s potential.

The Intrapreneur and Entrepreneur

An intrapreneur is a person who focuses on innovation and creativity and who transforms a dream or an idea into a profitable venture by operating within the organizational environment. In contrast, entrepreneur is a person who does similar things, but outside the organizational setting. Entrepreneurs have the ability to see an a opportunity, obtain the necessary capital, labor and other inputs, and the know-how to put together an operation successfully. They are wiling to take personal risk of success and failure.

Creating an Environment for Entrepreneurship

Since it is a managerial responsibility to create an environment for effective and efficient achievement of group goals, managers must promote opportunities for entrepreneurs to utilize their potential for innovation. Entrepreneurs take personal risks in initiating change, and they expect to be rewarded for it. Finally, entrepreneurs need some degree of freedom to pursue their ideas; this in turn, requires that sufficient authority be delegated. Innovative persons often have ideas that are contrary to “conventional wisdom”. The Wharton school in Philadelphia has an entrepreneurial center. Important requirements for becoming an entrepreneur are self-confidence, willingness to work hard, experience with the product, good general education and some money to start.

Innovation and Entrepreneurship

Entrepreneurs have creative ideas they use their management skills and resource to meet identifiable needs in the marketplace. If successful, an entrepreneur can become wealthy. An innovation applies not only to high-tech companies but equally to low-tech, established business. Worthwhile innovation is not a matter of sheer luck; it requires systematic and rational work, well organized and managed for results.

Innovation comes about because of some of the following situations:

1. The unexpected event, failure or success.
2. The incongruous- what assumed and what really is.
3. The process of task that needed improvement.
4. Change in the market or industry structure.
5. Change in demographics.
6. Changes in meaning or in the way things are perceived.
7. Newly acquired knowledge.

Innovations based solely on bright ideas may be very risky and are, at times, not successful. The most successful innovations are often the mundane ones.

Reengineering the Organization

Reengineering is fundamental rethinking and radical redesign of business process to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service and speed.

Key aspects of Reengineering

1. Fundamental Rethinking: What the organization is doing and why. Systems and procedures were often outdated, inefficient and completely unnecessary.
2. Radical Redesign: not modification but a reinvention. Radical redesign often results in radical downsizing with detrimental effects on organizations. Downsizing or “rightsizing” is not the primary purpose of reengineering, intent is reducing costs, without necessarily addressing customer needs and expectations. While radical redesign, accompanied by downsizing, may indeed result in short-term cost savings, but it may also negatively affect the remaining work force. Teamwork has become increasingly important in the modern organization. But team efforts are built on trust and trust has to be built over a long period of time. With radical redesign, trust can be destroyed at once.
3. Dramatic Result: Dramatic improvements are moderated by failures. Some 50 to 70 per cent of reengineering efforts fail to deliver the intended the dramatic result.
4. Process: The need for carefully analyzing and questioning business process is indeed important. However, the process analysis must go beyond operations and must include the analysis and linking the enterprise to the external environment. Various subsystems need to be integrated into a total system. Process of transforming the inputs into outputs must go beyond technological and human aspects, and indeed the total managerial system as suggested in this book.

Integrating reengineering with other systems through a new systems model called “Management by Processes” can be suggested to overcome some of the weaknesses of the narrowly focused reengineering approach.

The Structure and Process of Organizing

Looking at organizing as a process requires that several fundamentals be considered.

1. The structure must reflect objectives and plans, because activities derive from them.
2. It must reflect the authority available to an enterprise’s management.
3. An organization structure, like any plan, must reflect its environment. Just as the premises may be economic, technological, political, social or ethical, so may be those of an organization structure.

Organizational structure must be designed to work, to permit contributions by member of group and to help people gain objectives efficiently in changing future. A workable organization structure can never be static. There is no single organization structure that works best in all kind of situations. An effective organization structure depends on situation. Organization structure must take into account people’s limitations and customs. This is not to say that the structure must be designed around individuals instead of around goals and accompanying activities. But an important consideration is the kind of people who are to staff it.

Logic of Organizing

1. Establishing enterprise objectives.
2. Formulating supporting objectives, policies and plans.
3. Identifying, analyzing and classifying the activities necessary to accomplish these.
4. Grouping these activities in the light of human and material resources available and the best way, under the circumstances, of using them.
5. Delegating to the head of each group the authority necessary to perform the activities.
6. Tying the group together horizontally and vertically, through authority relationship and information flows.

Note, organizing does not imply any extreme occupational specialization. To say that tasks should be specific is not to say they must be limited and mechanical. In any organization, jobs can be defined to allow little or no personal leeway or the widest possible discretion. One must not forget that there is no best way to organize and that the application of structural organization theory must take into account the situation.

03: Decision Making

Decision Making is defined as the selection of a course of action from amongst alternatives; it is at the core of the planning. A plan cannot be said to exist unless a decision a commitment of resources, direction, or reputation- has been made. Until the point, there are only planning studies and analysis.

The Importance & Limitations of Rational Decision Making

What is Rationality in Decision Making?

Rational decision making attempts to reach some goal that cannot be attained without an action. For rational decision making, we must have clear understanding of alternative courses by which a goal can be reached under existing circumstances and limitation. This needs information and the ability to analyze and evaluate alternatives in the light of the goal sought. Finally it requires having a desire to come to the best solution by selecting alternative that most effectively satisfies goal achievement.
It is seldom to achieve complete rationality, particularly in managing. As first, decisions must operate for the future, and the future almost invariably involves uncertainties. Second, it is difficult to recognize all the alternatives that might be followed to reach a goal.

Limited or “Bounded” Rationality

Limitation of information and time makes a manager to settle for limited rationality, or bounded rationality. Bounded Rationality, i.e. satisficing, is picking a course of action that is satisfactory or good enough under the circumstances.

Development of Alternatives and the Limiting Factor

If we can think of only one course of action, clearly we have not thought hard enough. The ability to develop alternatives is often as important as being able to select an alternative correctly. On the other hand ingenuity, research and common sense will often unearth so many choices that all of them cannon be adequately evaluated. A Limiting Factor is something that stands in the way of accomplishing a desired objective. Recognizing the limiting factors in a given situation makes it possible to narrow the search for alternatives to those that will overcome the limiting factors.
The principle of the limiting factor (or strategic factor) is: by recognizing and overcoming those factors that stand critically in the way of a goal, the best alternative course of action can be selected.

Evaluation of Alternatives

Decision making requires at various steps of planning – in selecting goals, in choosing critical premises and ultimate decision making is required in selecting alternatives.

1. Quantitative and Qualitative Factors: Quantitative Factors are factors that can be measured in numerical terms, such as time or various fixed and operating costs. Qualitative or Intangible Factors are factors that are difficult to measure numerically, such as quality of labor relations, the risk of technological change. To evaluate and compare the intangible factors in a planning problem and make decisions, managers must first recognize these factors and then determine whether a reasonable quantitative measurement can be given to them.
2. Marginal Analysis:Marginal Analysis to compare additional revenues arising from additional costs. If the additional revenues of a larger quantity are greater than its additional costs, more profits can be made by producing more. However, if the additional revenues of the larger quantity are less than its additional costs, a larger profit can be made by producing less. For the best output of a machine, input could be varied against outputs until the additional input equals the additional output. This would be the point of maximum efficiency or the machine.
3. Cost Effectiveness Analysis: Cost effectiveness analysis seeks the best ratio of benefits and costs.

Selecting an Alternative

There are three basic approaches (1) Experience (2) Experimentation and (3) Research and analysis

1. Experience: Reliance on past experience probably plays a larger part than it deserve in decision making. To some extent, experience is the best teacher, however, relying on past experience as a guide for future action can be dangerous. In the first place, underlying reasons for mistakes or failures are not recognized. In second place, lessons of experience may be entirely inapplicable to the new problems. Good decisions must be evaluated against future events, while experience belongs to the past. Careful analyzing of experience, rather than blindly following it, and studying fundamental reason for success or failure makes experience as a useful basis for decision making.
2. Experimentation: Obvious way to decide among alternatives is to try one of them and see what happens. The experimental technique is likely to be the most expensive of all techniques, especially if a program requires heavy expenditures of capital and personnel. Also they may still be doubt about what it proved. Having said that, a firm may test a new product in certain market before expanding its sale nationwide.
3. Research and Analysis: One of the most effective techniques for selecting from alternatives, when major decisions are involved, is research and analysis. This approach means solving a problem by first comprehending it. It thus involves a search for relationships among the more critical of the variables, constraints and premises that bear upon the goal sought. Solving a planning problem requires breaking it into its component parts and studying the various quantitative and qualitative factors. Study and analysis are likely to be far cheaper than experimentation.

Programmed and Non-Programmed Decisions

A programmed decision is applied to structured or routine problems. E.g. Lathe operators have specifications and rules that tell them whether the part they mad is acceptable, has to be discarded, or should be reworked. This kind of decision is used for routine and repetitive work. Non-Programmed decisions are used for unstructured, novel and ill-defined situations of a nonrecurring nature. Most decisions are neither completely programmed nor completely non-programmed they are combination of both. Most Non-Programmed decisions are made by upper-level managers; this is because upper-level managers have to deal with unstructured problems. Problems at lower levels of the organization are often routine and well structured, requiring less decision discretion by mangers and non-managers.

Decision Making under Certainty, Uncertainty and Risk

Virtually all decisions are made in an environment of at least some uncertainty. However, the degree will vary from relative certainty to great uncertainty.
In situation involving certainty, we are reasonably sure about what will happen when they make a decision. The information is available and considered to be reliable, and the cause and effect relationships are known.
In a situation of uncertainty, on the other hand, we have only a meager (thin) database, we do not know whether or not the data are reliable, and we are very unsure about whether or not the situation may change. Moreover, we cannot evaluate the interactions of the different variables.
To improve decision making, one may estimate the objective probabilities of outcome by using a mathematical models. On the other hand, subjective probability, based on judgment and experience, may be used. All intelligent decision makers dealing with uncertainty like to know the size and nature of the risk they are taking in choosing a course of actions.
Virtually every decision is based on the interaction of number of important variables, many of which have an element of uncertainty but, perhaps, a fairly high degree of probability. Thus, wisdom of launching a new product might depend a number of critical variables: the cost of introducing the product, the cost of producing it, the capital investment that will be required, the price that can be set for the product, the size of the potential market, and the share of the total market that it will represent.

Creativity and Innovation

An important factor in managing people is creativity. A distinction can be made between creativity and innovation. The term creativity usually refers to the ability and power to develop new ideas. Innovation, on the other hand, usually means the use of these ideas.

The Creative Process

The creative process is seldom simple and liner. Instead, it generally consists of four overlapping and interacting phases:unconscious scanning, intuition, insight and logical formulation.
The first phase, unconscious scanning, is difficult to explain because it is beyond consciousness. This scanning usually requires absorption in the problem which may be vague in the mind.
The second phase, intuition, connects the unconscious with the conscious. This stage may involve a combination of factors that may seem contradictory at first. Intuition needs time to work. It requires that people find new combinations and integrate diverse concepts and ideas. Intuitive thinking is promoted by several techniques such as brainstorming.
Insight, the third phase of the creative process, is mostly the result of hard work. For example, many ideas are needed in the development of a usable product, a new service or a new process. Few insights may last for only a few minutes, and effective managers may benefit from having paper and pencil ready to make note of their creative ideas.
The Last phase in the creative process is logical formulation orverification. Insight needs to be tested through logic or experiment.

Brainstorming

Creativity can be taught. Creative thoughts are often the fruits of extensive efforts. Some techniques focus on group interactions; others focus on individual actions. The purpose of the brainstorming is to improve problem solving by finding new and unusual solutions. In the brainstorming session, a multiplication of ideas is sought. The rules are as follows.
1. No ideas are ever criticized.
2. The more radical the ideas are the better.
3. The quantity of idea production is stressed.
4. The improvement of ideas by others is encouraged.
Brainstorming emphasizes group thinking which may work well, in case when the information is distributed among various people. Otherwise individuals could develop better ideas working by themselves than they could work in group.
Limitation of traditional Group Discussion is, experts on a topic may not be willing to express their ideas in a group for fear of being ridiculed.

The creative Manager

In appropriate environment virtually all people are capable of being creative, even though the degree of creativity varies considerably among individuals. It is beyond question that creative people can make great contribution to an enterprise. At the same time, however, they may also cause difficulties in organizations. Change -- as many manger knows-- is not always popular. Creative individuals may be disruptive by ignoring established polices, rules and regulation. Creative people should have enough freedom to purse their ideas, but not too much so that they waste their time or do not find enough time to collaborate with others for working towards common goals. Having said this creativity is not a substitute for managerial judgment. It is manager who must determined and weigh the risks involved in pursuing unusual ideas and translating them into innovative practices.

02: Strategies, Policies and Planning Premises

Conceptually Strategic Planning is deceptively simple; analyze the current and expected future situation, determine the direction of the firm, and develop means for achieving the mission. In reality this is an extremely complex process that demands a systematic approach for identifying and analyzing factors external to the organization and matching them with the firm’s capabilities.

01. The Nature and Purpose of Strategies and Policies
Strategy: Derived from Greek Word strategos, meaning “general”
Strategy refers to the determination of the purpose (or mission) and the basic long-term objectives of an enterprise, and the adoption of course of action and allocation of resources necessary to achieve these aims. Therefore, objectives are a part of the strategy formulation.
Policies are general statements or understandings that guide managers’ thinking in decision making. They usually do not require action but are intended to guide managers in their commitment to the decision they ultimately make.
Strategies and policies must be put into practice by means of plans, increasing in detail until they get down to the nuts and bolts of operation. Tactics then, are the action plans through which strategies are executed. Strategies must be supported by effective tactics. 

02. The Strategic Planning Process

1. Input to the Organization: Various Inputs (People, Capital, Management and Technical skills, others) including goals input of claimants (Employees, Consumers, Suppliers, Stockholders, Government, Community and others)need to be elaborated.
2. Industry Analysis: Formulation of strategy requires the evaluation of the attractiveness of an industry by analyzing the external environment. The focus should be on the kind of compaction within an industry, the possibility of new firms entering the market, the availability of substitute products or services, the bargaining positions of the suppliers, and buyers or customers.
3. Enterprise Profile: Enterprise profile is usually the starting point for determining where the company is and where it should go. Top managers determine the basic purpose of the enterprise and clarify the firm’s geographic orientation.
4. Orientation, Values, and Vision of Executives: The enterprise profile is shaped by people, especially executives, and their orientation and values are important for formulation the strategy. They set the organizational climate, and they determine the direction of the firm though their vision. Consequently, their values, their preferences, and their attitudes toward risk have to be carefully examined because they have an impact on the strategy.
5. Mission (Purpose), Major Objectives, and Strategic Intent: Mission or Purpose is the answer to the question: What is our business? The major Objectives are the end points towards which the activates of the enterprise are directed. Strategic intent is the commitment (obsession) to win in the competitive environment, not only at the top-level but also throughout the organization.
6. Present and Future External Environment: The present and future external environment must be assessed in terms of threats and opportunities.
7. Internal Environment: Internal Environment should be audited and evaluated with respect to its resources and its weaknesses, and strengths in research and development, production, operation, procurement, marketing and products and services. Other internal factors include, human resources and financial resources as well as the company image, the organization structure and climate, the planning and control system, and relations with customers.
8. Development of Alternative Strategies: Strategic alternatives are developed on the basis of an analysis of the external and internal environment. Strategies may be specialize or concentrate. Alternatively, a firm may diversify, extending the operation into new and profitable markets. Other examples of possible strategies are joint ventures, and strategic alliances which may be an appropriate strategy for some firms.
9. Evaluation and Choice of Strategies: Strategic choices must be considered in the light of the risk involved in a particular decision. Some profitable opportunities may not be pursued because a failure in a risky venture could result in bankruptcy of the firm. Another critical element in choosing a strategy is timing. Even the best product may fail if it is introduced to the market at an inappropriate time.
10. Medium/Short Range Planning, Implementation through Reengineering the Organization Structure, Leadership and Control: Implementation of the Strategy often requires reengineering the organization, staffing the organization structure and providing leadership. Controls must also be installed monitoring performance against plans.
11. Consistency Testing and Contingency Planning: The last key aspect of the strategic planning process is the testing for consistency and preparing for contingency plans.

03. The TOWS Matrix

For many years, the SWOT analysis has been used to identify a company’s strengths, weakness, opportunities and threats. However, this kind analysis is static and seldom leads to the development of distinct alternative strategies based on such an analysis. Therefore, the TOWS Matrix has been introduced for analyzing the competitive situation of the company or even of nation leading to the development of four distinct sets of strategic alternatives. The TOWS Matrix is a conceptual framework for a systematic analysis that facilitate matching the external threats and opportunities with the internal weaknesses and strength of the organization.

External Factors

1. External Opportunity (O): Current and future economic conditions, political and social changes, new products, services and technologies. (considering risks)
2. External Threat (T): Lack of energy, competition. Also threat in current and future economic conditions, political and social changes, new products, services and technologies.

Internal Factors

1. Internal Strength (S): Strength in management, operations, finance, marketing, R&D, engineering.
2. Internal Weaknesses (W): Weakness in management, operations, finance, marketing, R&D and engineering.

Strategies are based on above four components.

1. The WT Strategy: It aims to minimize both weaknesses and threats and may be called the “mini-mini” strategy. It may require that the company, for example, form a Joint Venture, retrench, or even liquidate.
2. The WO Strategy: It attempts to minimize the weakness and maximize the opportunities. So it requires to develop those areas within the enterprise or acquire the needed competencies from the outside.
3. The ST Strategy: It is based on the organization’s strength to deal with threats in the environment.
4. The SO Strategy: This is the most desirable situation, in which company can use its strengths to take advantage of opportunities. Indeed it is the aim of enterprise to move from other position in the matrix to this one, if they have weakness they will strive to overcome them, making them strengths. If they face threats, they will cope with them so that they can focus on opportunities.

The strategy designer must prepare several TOWS Matrices at different point in time.

04. The Portfolio Matrix: A tool for allocating resources

This is simplified version of the matrix, shows the linkages between the growth rate of the business and the relative competitive position of the firm. Business Growth Rate can be High or Low similarly Relative Competitive Position can be Strong or Weak. This is developed for large corporations and are too simple.

Strategies based on above four combinations are as follows:

1. Question Mark: Weak market share and a high growth rate, usually require cash investment so that they can become Stars
2. Stars: The businesses in the high growth rate and Strong competitive position. They have opportunities for growth and profit.
3. Cash Cows: With strong competitive position and low growth rate, are usually well established in market, and such enterprise are in the position of making their products at low cost.
4. Dogs: These are businesses with low growth rate and weak market share. These businesses are usually not profitable and generally should be disposed of.

05. Major Kinds of Strategies and Policies

For a business enterprise, the major strategies and policies that give an overall direction to operations are likely to be in the areas of growth, finance, organization, personnel, public relations, products or services, and marketing.

Product or Services Strategies:
Key questions in this area can be summarized as follows:
1. What is our business?
2. Who are our customers?
3. What do our customers want?
4. How much will our customers buy and at what price?
5. Do we which to be a product leader?
6. What is our competitive advantage?
7. Do we wish to develop our own new products?
8. What advantages do we have in serving customer needs?
9. How should we respond to existing and potential completion?
10. How far can we go in serving customer needs?
11. What profits can we expect?
12. What basic form should our strategy take?

Marketing Strategy:
These are design to guide managers in getting products or services to customers and in encouraging customers to buy. They are closely related to product strategies; they must be interrelated and mutually supportive. Marketing and Innovations are key factors for business survival. Key questions in this area can be summarized as follows:
1. Where are our customers, and why do they buy?
2. How do our customers buy?
3. How is it best for us to sell?
4. Do we have something to offer that competitors do not have?
5. Do we wish to take legal steps to discourage competition?
6. Do we need, and can we supply, supporting services?
7. What are the best pricing strategies and policies for our operation?
8. How can we best serve our customers?

Hierarchy of Company Strategies 
At the top of the pyramid is the Corporate-level Strategy i.e. overall strategy for a diversified company. What industry company wants to compete? The second level in the hierarchy,Business Strategies are developed, usually by the general manager of business unit. The purpose of the business strategy is to gain a competitive advantage in particular area of product line. On the third hierarchical level, Functional Strategies (or policies) are developed. Thus, Strategies are devised for department or other organizational units such as finance, production, marketing, service, personnel and so on.

06. Porter’s Industry Analysis and Generic Competitive Strategies

Michael Porter at Harvard has suggested that strategy formulation requires an analysis (attractiveness) of the industry and the company’s position within that industry.

1. Industry Analysis: Five forces of Industry Analysis are a. The competition among companies. b. The threat of new companies entering in the market. c. Possibility of using substitute product or service. d. bargaining power of the supplier. e. bargaining power of buyers or customers. On basis of industry analysis a company may adopt generic strategy or strategies.
2. Overall Cost Leadership Strategy: This strategic approach aims at reductions in cost, based to a great extent on experience. The objective is for a company to have low cost structure when compared with that of its competitors.
3. Differentiation Strategies: This strategy attempts to offer something unique in the industry in respect to products or services.
4. Focused Strategy (Low Cost or Differentiation): This strategy concentrates on special groups of customers, a particular product line, a specific geographic region or other aspects that become the focal point of the firm’s efforts. This may be accomplished by low-cost strategy, differentiation or both. In general company needs to choose a generic strategy and should not “get stuck in middle”
5. Best Value and Best Cost Producer: This is a hybrid strategy that focuses on the customers that want a differentiated product but a cost lower than that of its rivals.

07. Premising and Forecasting

The most overlooked but the most essential step. This is establishment of, and the agreement by managers and planners to utilize, consistent assumptions critical to plans under consideration.

Planning Premises are defined as the anticipated environment in which plans are expected to operate. They include assumptions or forecasts of the future and known conditions that will affect the operation of plans.

A forecast that are planning premises and forecasts that are translated into future expectancies can be distinguished as in the first case, the forecast is a prerequisite of planning; in the second case, the forecast is the result of planning. At the same time, plans themselves and forecast of their future effects often become premises for other plans.

In practice, Environmental forecasting is much more complicated.

Values and areas of forecasting
Values of forecasting

1. This compels thinking ahead, looking to the future, and providing for it.
2. Discover areas where necessary control is lacking.
3. Participation throughout the organization helps to unify and coordinate plans.

Areas for forecasting include economic, social, political/legal and technical.

One approach of forecasting is Delphi technique, in which experts are ask to forecast till convergence of opinion begins to evolve.

01: Planning

01. Managerial Planning 

Manager's most essential task is to see that everyone understands the group's purpose and objectives and its methods to attaining them. Planning involves selecting the missions and objectives and actions to achieve them. Planning requires decision making, which involves, choosing from among alternative future course of action. Planning also strongly implies managerial innovation. Planning and controlling are closely interrelated.

02. Planning Process

1. Being aware of opportunity. In terms of The Market, Competition, What customer wants, Our Strength and Weaknesses. Managers must understand what problems they wish to solve and why, and know what they expect to gain.
2. Setting long term and short term objectives. Where we want to be and what we want to accomplish and when. (No short-run plan should be made unless it contributes to the achieving of the relevant long-range plan.). The objectives of lesser departments will be more accurate if subdivision managers understand the overall enterprise objectives and the derivative goals. 
3. Considering planning premises. In what environment (internal or external) will our plan operate? (The more thoroughly individuals charged with planning understand and agree to utilize consistent planning premises, the more coordinated enterprises planning will be)
4. Identifying alternatives. What are the most promising alternatives to accomplishing our objectives? (There is seldom a plan for which reasonable alternatives do not exist, and quite often an alternative that is not obvious proves to be the best. The more common problem is not finding alternatives but reducing the number of alternatives so that the most promising may be analyzed.)
5. Comparing alternatives in the light of objectives sought. Which alternative will give us the best chance of meeting our goals at the lowest cost and highest profit?
6. Choosing an alternative. Selecting the course of action we will pursue.
7. Formulating supportive plans. Such as plan to Buy equipment, material, hire and train workers develop a new product.
8. Numberizing plans by making budgets. Develop such budgets as: volume and price of sales, operating expenses necessary for plans, expenditure for capital equipment.

03. Types of Plans

1. Purposes or Missions: Identifies the basic function or task of an enterprise or agency or any part of it.
2. Objectives or Goals: Ends towards which the activity is aimed. They represent not only the end points of planning but also the ends towards which organizing, staffing, leading and controlling are aimed.
3. Strategies: Determination of the basic long-term objectives of an enterprise and the adoption of course of action and allocation of resources necessary to achieve these goals.
4. Policies: These are general statements or understanding that guide or channel thinking in decision making. Policies define an area within which a decision is to be made and ensure that the decision will be consistent with and contribute to an objective.
5. Procedures: These are plans that establish a required method of handling future activates. They are chronological sequences of required actions. They are guide to action, rather than to thinking, and they detail the exact manner in which certain actives must be accomplished.
6. Rule: Rules out specific required actions or non actions, allowing no discretion.
7. Programs: Complex goals, policies, procedures, rules, task assignments, steps to be taken, resources to be employed and other elements necessary to carry out a given course of action. They are ordinarily supported by budgets.
8. Budget: Budget is a statement of expected result expressed in numerical terms. Financial operating budget is often called Profit Plan. A budget may be expressed in financial terms, in terms of labor-hours units of product, or machine-hours or in any other numerically measurable term.

04. Objectives

Important ends toward which organizational and individual activates are directed. Whether they are long-term or short-term, broad or specific, the emphasis is on verifiable objectives; that is, at the end of the period it should be possible to determine whether or not the objective has been achieved. Objectives need to be supported by the sub-objectives. Thus objectives form a hierarchy as well as a network.

Relationship of objectives and the organizational Hierarchy
Objectives need to be supported by the sub-objectives. Thus, objectives form a hierarchy as well as network. 
1. Socio-Economic Purpose: It can be vision, purpose of the organization in terms of beneficial to society 
and organization both (social responsiveness) (Decided by board of directors, top-level mangers)
2. Mission: What organization is doing and what it wants to achieve. (Decided by board of directors, top-level managers)
3. Overall Objectives of the Organization: This includes long range objectives and strategic plans. (Decided by board of directors, top-level managers)
4. More specific overall Objectives: This includes KRA(Key Result Area), Market Standing, Innovation, productivity, profitability etc. (Decided sometime by board of directors or top and middle level managers)
5. Division Objectives: (Decided sometime by top level mangers, or middle level managers)
6. Department or Unit Objectives: (Decided middle and lower level managers)
7. Individual Objectives: This include performance and Personal development objectives (Decided by lower level managers)

The Process of Setting Objectives
In top down approach, upper level mangers determine the objectives for subordinates, while in the bottom-up approach; subordinates initiate the setting of objectives for their positions and present them to their superiors. Most of the time, bottom-up approach is underutilized but that either approach alone is insufficient. 

05. How to Set Objectives

Quantitative and Qualitative Objectives
To be measurable, objectives must be verifiable. At the end of the period, how do I know if the objective has been accomplished? Example, Non verifiable Objectives: To make a reasonable profit. Verifiable Objectives: To achieve a return on investment of 12% at the end of the current fiscal year.

Checklist for Manager Objectives
1. Do the objectives cover the main features of may job?
2. Is the list of objectives too long? If so, can I combine some objectives?
3. Are the objectives verifiable? Whether or not they have been achieved?
4. Do the objective indicate:
a. Quantity (how much)?
b. Quality (how well or specific characteristic)?
c. Time (when)?
d. At what cost?
5. Are objectives challenging, yet reasonable?
6. Are priorities assigned to the objectives (ranking, weighting, etc)?
7. Does the set of objectives also included:
a. Improvement objectives?
b. Personal development objectives?
8. Are the objectives coordinated with those of other managers and organizational units? (Are they consistent with objectives of my superior, my department, the company)?
9. Have I communicated objectives to all who need to be informed?
10. Are the short-term objectives consistent with long-term aims?
11. Are assumptions underlying the objectives clearly identified?
12. Are the objectives expressed clearly, and they in writing?
13. Do the objectives provide for timely feedback so hat I can take any necessary corrective steps?
14. Are my resources and authority sufficient for achieving the objectives?
15. Have I given the individuals who are expected to accomplish objectives a chance to suggest their objectives?
16. Do my subordinates have control over aspects for which they are assigned responsibility?

06. Evolving Concepts in Management by objectives (MBO) 

MBO is comprehensive managerial system that integrates many key managerial activities in a systematic manner that is consciously directed towards the effective and efficient achievement of organizational and individual objectives. Among benefits it result in better managing, often forcing mangers to clarify the structure of their organizations, encouraging people to commit themselves to their goals, helping them to develop effective controls. Some of it weaknesses are that managers sometimes fail to explain the philosophy of MBO to subordinates and give them guidelines for their goal setting. In addition, goals themselves are difficult to set, tend to be short-run and may become inflexible despite changes in the environment. People, in their search for veridicality, may overemphasize quantifiable goals.