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MNB1501/202/3/Tutorial Letter 202/3/ 2021Business Management IAMNBSemesters 1 & 2 (ALL)Department of Business ManagementIMPORTANT INFORMATIONPlease register on myUnisa, activate your myLife e-mail address and make sure that you have regular access to the myUnisa module website, MNB- 1501 -2021-A...

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MNB1501/202/3/2021

Tutorial Letter 202/3/2021 Business Management IA

MNB1501 Semesters 1 & 2 (ALL) Department of Business Management

IMPORTANT INFORMATION Please register on myUnisa, activate your myLife e-mail address and make sure that you have regular access to the myUnisa module website, MNB-1501-2021-ALL.

Note: This is an online module and it is available on myUnisa. Therefore, you will not receive a printed format of this tutorial letter. BARCODE

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Contents 1

INTRODUCTION ....................................................................................................................... 3

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COMMENTS ON ASSIGNMENT 02 .......................................................................................... 3

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CONCLUDING REMARKS .......................................................................................................19

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MNB1501/202/3/2021

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INTRODUCTION

Dear Student The purpose of this tutorial letter is to provide you with feedback on Assignment 02. The assignments and the feedback are an important part of your learning and will assist you in preparing for the examination. The assignment should give you a good indication of the types of questions you can expect in the examination, but please note that we do not repeat assignment questions in the examination. Assignment 02 covers chapters 5 to 10 in the 11th edition of the prescribed book Introduction to Business Management (ITBM).

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COMMENTS ON ASSIGNMENT 02

We suggest that you do not mark the correct answers on the actual assignment in Tutorial Letter 101 or 001. A very useful method of revision towards the end of the semester is to work through your assignments again. If you see the correct answer before you even read the question, your revision will be less effective. It is best to record your own answers separately from the correct answers. The following explanations form the most vital part of the teaching process. Go through the answers now – do not wait until just before the examination. Study the comments carefully and compare them with the reasoning in your answers. Make sure that you understand our reasons for the answers. STUDY UNIT 5: CORPORATE SOCIAL RESPONSIBILITY QUESTION 1 Corporate ______________ recognises corporations as legal persons with certain rights and responsibilities in the same way that individuals have rights and responsibilities as members of a community. 1 citizenship 2 social investment 3 social responsibility 4 governance The correct answer is option 1.

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Corporate citizenship can be described as the recognition that the organisation is an integral part of the broader society in which it operates, affording the organisation standing as a juristic person in the society with rights, but also the responsibilities and obligations. Option 2 is incorrect because social investment refers only to one very specific aspect of corporate social responsibility i.e. investment intended to deliver a positive social impact and return on the original investment. Corporate social responsibility differs from corporate citizenship because its main focus is on the responsibility of the organisation, not the rights. Hence, option 3 is also incorrect. Option 4 is also incorrect because corporate governance is all about how top management runs an organisation. Aspects such as fairness, integrity, accountability and transparency are of utmost importance. If your answer was wrong, refer to section 5.2 in the 11th edition of Introduction to Business Management (ITBM).

Read through the case scenario below and answer questions 2 to 4. South African Breweries (SAB) is listed on the Johannesburg Stock Exchange and the parent company, SABMiller is listed on the London Stock exchange. As such the SABMiller group of companies must comply with corporate governance rules set out for listed companies in various countries. Although corporate governance is the responsibility of every employee in the company, the following structures are particularly responsible for corporate governance in the SABMiller group: The Board of Directors, the Executive Committee, Audit Committee and Chief Financial Officer.

QUESTION 2 The Board of Directors of SABMiller are usually viewed as _____________ stakeholders. 1 external 2 indirect 3 primary 4 secondary

The correct answer is option 3. The board of directors is responsible for providing a strategic direction for an organisation and have a contractual or financial relationship with the organisation. Hence, they are primary stakeholders. Options 1 and 2 are incorrect because we do not classify stakeholders as external or indirect in this module. Option 4 is also incorrect because secondary stakeholders are those who are outside the organisation and play no role in the operation of the organisation. 4

MNB1501/202/3/2021 If your answer was wrong, refer to section 5.5 in the 11th edition of ITBM.

QUESTION 3 If SAB’s corporate social responsibility policy is aligned to the company’s policy, vision and mission, it is using __________________. 1 a values-based system 2 a stakeholder-engagement process 3 a combination of options 1 and 2 4 None of the above The correct answer is option 1. A value-based system is adopted when an organisation aligns its CSR policy with the vision, mission, values and guiding principles of the organisation. The stakeholder-engagement process is undertaken to solicit information from various stakeholders to compile a well-documented plan outlining stakeholder concerns, their impact, as well as the required responses. Therefore, options 2 and 3 are incorrect. Option 4 is also incorrect because the right answer for this question is a values-based system. If your answer was wrong, refer to section 5.3.3 in the 11 th edition of ITBM.

QUESTION 4 SAB is aware of the damaging effect alcohol can have on its consumers and has implemented various programmes to counteract this. SAB, therefore, has a social driver behind its CSR programme. This means that they are aware ______________________. 1 that it is desirable for a company to be thought of as socially responsible 2 that there is specific legislation encouraging socially responsible behaviour 3 that the main advantage is a reduction in costs 4 that a decision was made that clearly indicated what was right and what was wrong

The correct answer is option 1. The first option is correct because the social drivers implies that the organisation is aware that it is desirable to be thought of as socially responsible. The other three options are incorrect because they relate to government (option 2), market (option 3) and ethical drivers (option 4). If your answer is wrong, refer to section 5.2.3 in the 11th edition of ITBM.

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STUDY UNIT 6: INTRODUCTION TO GENERAL MANAGEMENT

QUESTION 5 Which one of the following statements is wrong? Management is necessary to ______________________________ 1 direct an organisation towards its goals. 2 keep the operations of an enterprise on a balanced course. 3 keep the organisation in equilibrium with its environment. 4 attain organisational goals at the lowest possible productivity levels. The correct answer is option 4. The first three options are right regarding management. Management needs to direct an organisation towards its goal, keep the operations on a balanced course and equilibrium with its environment. Option 4 is correct because the last statement is WRONG, management is necessary to reach the goals of the organisation at the highest possible level of productivity If your answer is wrong, refer to section 6.2 in the 11th edition of ITBM.

QUESTION 6 As a director, Joe Soap will primarily make use of _____________ skills in carrying out his duties. 1 conceptual 2 intellectual 3 interpersonal 4 technical The correct answer is option 1. Joe Soap is a director of a company and directors in most organisations form part of top management. Therefore, the primary skills that he uses are conceptual skills which involve the manager’s thinking and planning abilities. Option 2 is incorrect because intellectual skills are not one of the classifications of skills for this module. Interpersonal skills are mostly used by middlelevel managers (e.g. as functional heads) and technical skills by lower-level managers such as supervisors. Hence, options 3 and 4 are also incorrect. If your answer is wrong, refer to section 6.5 in the 11th edition of ITBM.

QUESTION 7 6

MNB1501/202/3/2021 Jake is a supervisor at Go Fast Go-kart Manufacturers. He is responsible for the painting and decorating division of the company. Jake is currently on the _____________ level of management at Go Fast Go-kart Manufacturers. 1 top 2 middle 3 lower 4 strategic The correct answer is option 3. Supervisors form part of lower-level management and are responsible for monitoring and guiding frontline workers. The other three options (options 1, 2 & 4) are incorrect because supervisors are not part of top, middle or strategic management. If your answer was wrong, refer to section 6.4 in the 11th edition of ITBM.

Read through the case scenario below and answer question 8. Tsogo Sun has been in the hospitality industry for over 44 years and is currently the leading hotel and entertainment group in Africa.

QUESTION 8 You are the marketing manager at Tsogo Sun. As the marketing manager you will develop the _____________ plans at Tsogo Sun. These plans are specific in focus and deal with people and actions. 1 tactical 2 operational 3 long-term 4 strategic The correct answer is option 1. As function head, the marketing manager is part of the middle-level management which focuses on their functional areas of the business and is primarily accountable for executing the policies, plans and strategies determined by top management. The other three options (options 2, 3 & 4) are incorrect because functional managers (middle-management) are not responsible for operational, long-term, or strategic plans. The latter is the responsibility of top management whereas the former should be taken care of by the supervisors (lower-management).

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If your answer was wrong, refer to section 6.4 in the 11th edition of ITBM.

STUDY UNIT 7: PLANNING Read the case scenario below and answer questions 9 and 10. Tsogo Sun creates and maintains long-term sustainable value through a number of key pillars including meeting reasonable requirements for their stakeholders, financial strength and durability and maintaining product relevance to customer experience.

QUESTION 9 By maintaining product relevance to customer experience through constantly improving its products and services, Tsogo Sun is adopting a corporate growth strategy known as ______________. 1 concentration growth 2 innovation 3 integration 4 diversification The correct answer is option 2. Innovation is all about constantly improving the products and services of an organisation. Initial high profitable products and services are enhanced using new technology in a specific industry resulting in new and better products and services. Option 1 is incorrect because concentration growth refers to a strategy undertaken by an organisation to direct all its resources and skills to the profitable growth of a single product in a single market. Integration (option 3) and diversification (option 4) are also incorrect because there are both external growth strategies. External growth strategies are intended to increase the products and services of an organisation by acquiring resources and capabilities that are not internally developed by the company itself. If your answer was wrong, refer to section 7.4.3 in the 11th edition of ITBM.

QUESTION 10 Tsogo Sun has invested in projects totalling US$ 100 million in Nigeria and Mozambique and continues to look for opportunities to add to their businesses in these regions to expand their market offering. This is an example of a __________________ corporate growth strategy. 1 diversification 2 market development 3 product development 8

MNB1501/202/3/2021 4 turnaround The correct answer option 2. Market development involves developing existing markets for the organisation’s present products more extensively or developing new markets for existing products. In this case, Tsogo Sun developed new markets in Nigeria and Mozambique for its existing products i.e. hotels. Option 1 is incorrect because diversification relates to when an organisation acquires other organisations to enter into new activities. Product development (option 3) is also incorrect because Tsogo Sun did not develop new products when expanding to Nigeria and Mozambique, but continued with its current offering. The turnaround corporate strategy is all about cutting costs, and in the scenario, it was not the case, hence option 4 is also incorrect. If your answer was wrong, refer to section 7.4.3 in the 11th edition of ITBM.

QUESTION 11 The sequential steps in the planning process are: 1 developing plans, goal-setting, feedback 2 goal-setting, mission statement, implementation 3 mission statement, developing plans, feedback 4 goal-setting, developing plans, implementation

The correct answer is option 4. The correct order of the steps of the planning process is as follows: (1) goal-setting, (2) developing plans, (3) implementation. Options 1, 2 and 3 are incorrect because they either included aspects that are not part of the steps of the planning process, for example, mission statement and feedback. If your answer is wrong, refer to section 7.4.2 in the 11th edition of ITBM.

QUESTION 12 Telkom decides to make use of promotional pamphlets which they include in their monthly telephone bill for their ADSL service to increase the uptake of this service. This is an example of a ___________ plan which is set by __________ managers. 1 short-term/ lower-level 2 short-term/ middle-level 3 medium-term/ lower-level 4 medium-term/ middle-level 9

The correct answer is option 4. The marketing plan that was used is part of the tactical goal of the organisation and is mediumterm and should be set by midd le-level managers. Option 1 is incorrect because short-term are tactical and operational and the plan adopted by Telkom was something that was going to occur over an extended period. Options 2 and 3 are incorrect because there was a misalignment between the plan and the manager responsible. Short-term plans cannot be formulated by middle-level managers and medium-term plans cannot be the responsibility of lower-level managers. If your answer is wrong, refer to section 7.4.2 in the 11th edition of ITBM.

STUDY UNIT 8: ORGANISING QUESTION 13 Which one of the following statements about specialisation is incorrect? 1 The main purpose of specialisation is to increase productivity. 2 Excessive specialisation may have a negative effect on productivity. 3 Workers who perform highly specialised jobs may become bored and demotivated. 4 Specialisation can only be applied at operational levels.

The correct answer is option 4. Option 4 is wrong when it comes to specialisation because even managers at tactical and strategic levels specialise in something. For example, a marketing manager (tactical level) will only focus on marketing-related aspects of an organisation. Even at the board level, a Chief Financial Officer (strategic) focuses more on financial matters. The first three options are right when it comes to specialisation because the main aim of specialisation is to divide work into smaller and specialised units to take advantage of specialised knowledge and skills to improve productivity (option 1). As highlighted in Table 8.1 in the prescribed book, the disadvantage of specialisation is that if it is excessive, productivity will be negatively affected (option 2) and workers who perform highly specialised jobs may become bored and demotivated (option 3). Since this question required you to select the option that is incorrect when it comes to specialisation, option 4 is the correct answer. If your answer was wrong, refer to section 8.3.1 in the 11th edition of ITBM.

Read the scenario below and answer questions 14 and 15. Structure is extremely important at Nike as it largely prioritises where management spend their 10

MNB1501/202/3/2021 time. Large organisations such as Nike are often inundated with information if the organisational structure is not appropriate. To further enhance the current reporting relationships at Nike, the decision was taken to introduce an additional management layer in the Nike hierarch y.

QUESTION 14 What is the second step Nike had to take in establishing reporting lines, when they introduced the additional management layer in the Nike hierarchy? 1 Nike management had to determine the appropriate chain of command. 2 Nike management had to determine who reports to whom. 3 Nike management had to determine the optimal span of management. 4 Nike management had to determine if managers would be underutilised.

The correct answer is option 3. The second step of establishing reporting lines is to determine how many people will report to one manager. This is also known as the span of management or control. Options 1 and 2 are incorrect because the chain of command (who reports to whom) is determined during the first step. Option 4 is also incorrect because it is not one of the identified steps of establishing reporting lines. If your answer is wrong, refer to section 8.3.3 in the 11th edition of ITBM.

QUESTION 15 Alex is a manager at a Nike store in Gauteng. He needs to make sure that each person within the organisation has a clear reporting relationship to one, and only one, supervisor. This describes the ____________________. 1 chain of command 2 span of management 3 scalar principle 4 unity of command

The correct answer is option 4. Unity of command suggests that each person within an organisation must have a clear reporting relationship to one supervisor. The chain of command is all about determining who reports to whom, hence option 1 is incorrect. Option 2 is also incorrect, as the span of management refers to a number of employees reporting to one manager. The scalar principle suggests that there

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must be a clear and unbroken line of authority that extends from the lowest to the highest position in the organisation. Therefore, option 3 is also incorrect. If your answer was wrong, refer to section 8.3.3 in the 11th edition of ITBM.

QUESTION 16 Which one of the following is a distinct characteristic of formal authority? 1 Formal authority is vested in people, not organisational positions. 2 Formal authority is accepted by subordinates. 3 Formal authority flows up the vertical hierarchy of an organisation. 4 Formal authority is only present in centralised structures.

The correct answer is option 2. Formal authority is accepted by employees because they believe that managers have a legitimate right to issue orders. Option 1 is incorrect because formal authority is vested in organisational positions, not in people. Formal authority flows down the vertical hierarchy of an organisation, not upwards. Therefore, option 3 is incorrect. Furthermore, formal authority is used by all organisation regardless of the structures that they have adopted, i.e. centralised and decentralised, hence option 4 is also incorrect. If your answer was wrong, refer to section 8.3.4 in the 11th edition of ITBM.

QUESTION 17 The human resources department at the Seagull Luxury Resort comprises many subdepartments, including Remunerations and Training and Development, that all report to the Human Resources Manager. Cindy, the Human Resources Manager has authority over Craig, the Remunerations Manager, and Thabi, the Training and Development Manager. What kind of authority does ...