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Maldives Business School Cover Page ASSIGNMENT BRIEF BTEC HND/Associate Degree in Business (Management/HR/Marketing) The student must fill the relevant parts of the following table.

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Unit Unit 3: Organizations and Behavior Assignment reference 1 Assignment type This is an individual assignment. Task Submit on Do on Task 1: Report: LO1; LO2; M1; M2, D1 and D3 13th June 2015 NA Task 2: PowerPoint Presentation :LO3; LO4, M3 and D2 4th June 2015 6th June 2015

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P1.1 P1.2 P1.3 P2.1 P2.2 P2.3 P3.1 P3.2 P3.3 P4.1 P4.2 P4.3 M1 M2 M3 D1 D2 D3 This is the cover page for your assignments. Your assignment will be rejected if it does not have this cover page. Read the document titled Additional Guidance on Assignments for help on report the general report format, general presentation format and referencing.

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Executive Summary

This report is based on two organizations from the insurance sector; giving details

about the relationship between organizational structures and culture in these two

organizations. The two organizations looked over was Allied Insurance Company of

the Maldives and Aasandha Company Limited. Organizational behavior can be

defined as the study that explores how organizational structures within an

organization affect the behavior by internal and external factors. The purpose of the

report is to evaluate the problems and identify the possible causes and appropriate

solutions for the problems so that the issues involved in these two organizations can

be set up to the clients.

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TABLE OF CONTENTS

1. Executive Summary ........3

2. Introduction .......5

3. Organizational Structures & Culture (P1.1) ..5

3.1 Organizational Structures .....5

3.2 Organizational Culture ..6

3.3 Similarities & Differences between the Organizations Structures ..7

3.4 Similarities & Differences between the Organizations Culture ...7

4. How the Relationship between the Structures and Culture of these Organizations can

Impact on the Performance of the Businesses (P1.2) 8

4.1 Relationship between Structure and Culture on: ..8

4.2 Impact of this Relationship on the Performance of the Businesses ..8

5. Factors that Influence the Individual Behavior of the Employees at Work .9

5.1 Positive and Negative Effects ....10

5.2 Conclusion 10

6. Compare the Effectiveness of Different Leadership Styles in Organizations (P2.1)

...10

6.1 Leadership Styles Practiced at Allied Insurance & Aasandha Company ..13

7. How Organizational Theory Underpins the Practice of Management (P2.2) ..14

7.1 Theories related to the Organization 15

8. Different Approaches to Management used by Organizations (P2.3) ..16

8.1 Extent to which Approaches used by the Organizations fulfill Organizational

Purposes .....16

8.2 Conclusion ....16

9. References ..17

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INTRODUCTION

Allied Insurance Company of the Maldives and Aasandha Company Limited are both

insurance companies, where Allied Insurance provides a total of five types of

insurances including Home Insurance, Health Insurance, Travel Insurance, Third

Party Motor Insurance and Comprehensive Motor Insurance. Rather than Allied

Insurance, Aasandha Company provides only Health Insurance. However, this report

is based after surveys on both companies. Looking into some more detailed account

of the surveys, it is analyzed on the relationship between organizational structure

and culture and different approaches to management and leadership of both the

companies. As this report is based on organizational behavior, it can be defined as

the study of both group and individual performance and activity within an

organization. Internal and external perceptions are two theories of how

organizational behavior can be analyzed by organizations.

ORGANIZATIONAL STRUCTURES & CULTURE (P1.1)

ORGANIZATIONAL STRUCTURES

Organizational structure can be defined as Design of the basic structure involves

such central issues as how the work of the organization will be divided and assigned

among positions, groups, departments, divisions, etc., and how the coordination

necessary to accomplish total organizational objectives will be achieved. (Dalton,

Lawrence, & Lorsch, 1970)

TYPE DEFINITION

Functional structure Split into sub groups based on specialized functional areas

Product based structure Activities based on products or product lines which are grouped

Area based structure Divisions according to the geographic area

Matrix based structure One where there are multiple reporting lines; having more than one formal boss

Team-based structure Individuals with contemporary skills are grouped into teams

Multi-divisional structure Groups together employees for a particular product type or market service and broken down further into its own self-contained unit or division

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Aasandha Company

Functional Structure

Task Culture

Allied Insurance

Matrix based Structure

Power Culture

ORGANIZATIONAL CULTURE

The Websters New Collegiate Dictionary (1980) defines culture as the integrated

pattern of human behavior that includes thought, speech, action, and artifacts and

depends on mans capacity for learning and transmitting knowledge to succeeding

generations and the customary beliefs, social forms, and material traits of a racial,

religious or social group. (Nahavandi & Malekzadeh, 1993)

Power Culture: Power is held by few individuals who spread influence throughout

the organization.

Role Culture: Culture is based on rules and is highly controlled where everyone

knows what their roles and responsibilities are.

Task Culture: Teams are formed to address specific problems or progress projects.

Person Culture: Collection of individuals who happen to be working for the same

organization where they depend on the talents of the individuals.

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SIMILARITIES

As Allied is matrix based and Aasandha is functional based functional departmental heads are there

Both companies, Allied and Aasandha are team oriented

DIFFERENCES

Employees has a single superior in Aasandha as functional based structure is followed where as two superiors are in matrix based structure which is followed by Allied

Functional structure in Aasandha does not encourage interdivisional cooperation and knowledge sharing but as matrix based structure is followed by Allied, it highly encourages knowledge sharing and cooperation between divisions

SIMILARITIES

Both power and task cultures are based on small organizations like Allied and Aasandha

Both organizations are task oriented as power and task culture are followed

DIFFERENCES

In Aasandha as task culture is followed high standards are maintained with optimal efficeincy rather than power culture which is followed by Allied

In Allied a central figure influences throughout the organization while in Aasandha team is empowered to make decisions

SIMILARITIES & DIFFERENCES BETWEEN THE ORGANIZATIONS

STRUCTURES

SIMILARITIES & DIFFERENCES BETWEEN THE ORGANIZATIONS CULTURES

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HOW THE RELATIONSHIP BETWEEN THE STRUCTURES AND CULTURE OF

THESE ORGANIZATIONS CAN IMPACT ON THE PERFORMANCE OF THE

BUSINESSES (P1.2)

RELATIONSHIP BETWEEN STRUCTURE AND CULTURE ON:

(a) Decision Making Process & Time Consuming

As functional structure and task culture is followed by Aasandha a decentralized

method is used where authority is delegated to heads of departments who makes

decisions to short term related issues then and there. However, long term related

issues are sent to the board of directors where the decision is made by top

management.

b) Closeness to Customers

Aasandha is very much related to customers, meaning their satisfaction means

everything to the organization. Therefore, by using task culture, Aasandha is

more team based as customer satisfaction is increased by responding to their

needs and queries as soon as possible. Also, payments for the invoices are

made before the stated deadlines which increase job satisfaction.

c) Formalization & Functional Specialization

Departments are formed to their functions accordingly and tasks are subdivided.

Departments are separated as such: Claims Processing and Stakeholder

Relations, Fraud and Investigation etc. Organization functions formally and can

be classified further into task culture where certain rules and regulations are

made and need to be followed.

IMPACT OF THIS RELATIONSHIP ON THE PERFORMANCE OF THE

BUSINESS

Structure and culture can be classified as the backbone of the organization.

Progress of the organization is either positively or negatively affected. As task

culture is followed by Aasandha, certain policies, rules and regulations are made

and followed. A teamwork based approach is practiced to complete tasks in a

certain period of time. Also, tasks are subdivided and departments are separated

to perform their functions consequently. A tall structure is followed by the

organization where span of control is highly dispersed among all the levels of

organization. Therefore, decision making is quite fast and lower levels of

employees can also participate in the process, making them highly motivated. In

addition, it also provides appropriate standards for the working environment

which increases work efficiency. Looking at the drawbacks of a complex structure

or culture, decision making process will be slow and employees will be de-

motivated.

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FACTORS THAT INFLUENCE THE INDIVIDUAL BEHAVIOR OF THE

EMPLOYEES AT WORK (P1.3)

Organizations are based on individuals who have somehow organized in a form,

to attain a common objective. Each and every individual is contradistinctive and

behaves as such. Behavior of individuals can be affected by both innate and

environmental factors. This is because abilities, skills, perception, attitudes and

personality in one individual vary from another. Some of the factors that affect the

individual behavior are as follows:

Leadership - established by the management to provide assistance,

direction and coaching to employees. Positive effects on employees as

leaders stand by them as a strong source of inspiration and negative

effects if the manager is too strict.

Work Culture - workplace needs to be a comfortable place for employees

to stay positive and happy. By enforcing uniform rules and regulations for

all the employees a positive impression is on employees. However, if

reporting systems are complicated and there is no transparency, a

negative impression is on employees.

Job Responsibilities employees should be assigned the best task they

can perform and encouraging them to improve their skills, would be a

positive impact on them but overburdening them can be a negative impact.

Effective Communication the need of effective communication

between manager and employees are crucial as letting them express their

views and opinions make them feel more important creating a positive

impression. But if employees feel left out interest in work is diminished

creating a negative impression.

Family and Personal Life conflicts in personal life can lead to stress

and irrational behavior leaving negative impressions. Trying to keep

personal and professional life separate by not bringing personal problems

to work will leave positive impressions.

Relationships at work as having friends are necessary at the

workplace, people are needed to discuss and share experiences with as

this would be a positive impact. Restraining employees to interact with

other employers will lead to stress and frustration leaving a negative

impact.

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POSITIVE

Excellent motivators and works well in teams helps to achieve organizational motives

Easy going and can get in touch with anyone so level of customer satisfacton increases

NEGATIVE

Gets bored easily and concentration level decreases when slow and repetitive tasks are assigned, leading to a resistance in achieving goals

Being not good listeners, create conflicts to arise between co-employees consuming more time to attain goals

Personality is the total pattern of characteristic ways of thinking, feeling and

behaving that constitute the individuals distinctive method of relating to the

environment. (Media, 2010) Classification of personality traits and types of

individuals are very important in working environment. This possibly will be

categorized into introvert and extrovert, where extroverts are people people,

meaning that they are full of energy when they have people around them. However,

introverts are people not liking attention from a crowd and prefer to remain isolated.

They are often labeled as shy and inscrutable.

Contemplating Allied Insurance and Aasandha Company, most employees of both

companies are extroverts, who are habitually outgoing and establish contact with

new people effortlessly. These employees adapt easily to a given situation or

changes better than others. Therefore, they are more attuned to the responsibilities

and others individuality.

POSITIVE AND NEGATIVE EFFECTS

Even though, both companies mainly comprise of extroverts, there are positive and

negative effects likewise. Some of these positive and negative effects are outlined

below.

CONCLUSION

Consecutively for being a flourishing organization, both Allied Insurance and

Aasandha Company needs to appoint more extroverts who can be in touch with

customers. This would increase customer satisfaction which would lead to attain

organizational motives. Also, employees need to think of ways to approach slow and

repetitive tasks so that they can work more effectively to achieve the assigned goals.

In addition, as extroverts are excellent motivators who can work well in teams will

help to achieve these goals faster. Therefore, organizational factors such as physical

facilities, structure and design, leadership and reward system can be set up to

motivate the employees for more effective working.

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COMPARE THE EFFECTIVENESS OF DIFFERENT LEADERSHIP STYLES IN

ORGANIZATIONS (P2.1)

As leadership is hard to define, according to BusinessDictionary.com it can be

defined as the activity of leading a group of people or an organization or the ability

to do this. An effective leader creates an inspiring vision of the future and tries to

motivate and inspire employees to engage with this vision. The different styles of

leadership styles are:

Opportunist

Diplomat

Expert

Achiever

Strategist

Magician

Autocratic

Democratic

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The following table below gives more details of these leadership styles.

LEADERSHIP STYLES

CHARACTERISTICS BENEFITS DRAWBACKS

Opportunist

Puts self first, winning most important, manipulative, might makes right

Often successful at sales/making money

Alienates others over time, Doesnt inspire relationships or trust, closed feedback

Diplomat Focused on fitting in, avoids conflict, and looks to others for answers

The boss everyone likes personally, builds a cohesive team and is easy to get along with

Afraid to make tough choice. Afraid to innovate

Expert

Rules by logic and expertise, being right are most important, Always wants to find the right answer

Has a lot of knowledge to share. Willing to think rationally and stick to his/her guns

Often ignore or belittle the opinions of others. Has a hard time seeing other points of view, Can believe that being right is more important than being practical

Achiever

Getting things done well is important, Meets strategic goals. Focused on long-term goals and success

Very successful in setting up business goals and systems, committed to short-term and long-term profitability and growth. Inspires trust in those around him/her. Creative problem-solver

May focus on the goals at the expense of self or even larger questions of why? Can be neglectful of less goal-oriented facets of work and life

Strategist

Able to inspire organizational and personal change, Able to enact practical and transformational initiatives

Able to inspire others (team and clients), able to hold a long term growth vision and steadily work towards it

Might sacrifice short-term pay days for the longer term picture (although whether this is a weakness depends on your point of view)

Magician

Often spring to action when impossible situations arise. Have the power to inspire others and change the way a culture perceives reality

Attempt to convert imaginary concepts into real things, inspire others and help individuals look inside them

Sometimes not practical and may ignore common sense obstacles, experience repeated failures and may begin to lose faith in their abilities

Autocratic

Provide clear expectations of what needs to be done, when it should be done and how it should be done

Strongly focused on both command by the leader and control of the followers. Leader makes decisions independently

Decision-making is less creative. Style usually viewed as controlling, bossy and dictatorial

Democratic

Everyone given the opportunity to participate, ideas are exchanged freely, and discussion is encouraged

Tend to focus on group equality and free flow of ideas, leads to higher productivity, better contributions from employees and increased group morale

Roles are unclear, lead to communication failures, employees might not have the necessary knowledge or expertise to make quality contributions

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ALLIED INSURANCE

Decrease customer complaints

Minimize risks to achieve short-term goals

AASANDHA COMPANY

Improve both customer and employee satisfaction

Increase productivity and make payments within 20 days

ALLIED INSURANCE

Increased goal redundancies and conflicts

Lack of trainings for new employeees

AASANDHA COMPANY

Customer satisfaction rate declined

Dissatisfied employees with greater absenteeism

LEADERSHIP STYLES PRACTICED AT ALLIED INSURANCE & AASANDHA

COMPANY

BUSINESS OBJECTIVES

PROBLEMS

Allied Insurance practice Autocratic leadership style, which helps to achieve their

objectives and eliminate problems by providing clear information what needs to be

done and how it can be done. This aids to minimize risks while attaining short-term

goals. Though, the leader makes the decisions proper trainings of how work should

be done were carried out for new employees. Also, by communicating effectively

across the organization decreased goal redundancies and conflicts, as goal sharing

helped employees to support each other. These aspects directed the organization

towards its goals.

As Aasandha Company follow Democratic leadership style, every employee is given

the chance to participate and exchange ideas freely, which aids to reach their goals

by eradicating problems faced. This helped to convince employees and shrink

absenteeism as their ideas were heard and applied too. Moreover, this increased the

efficiency of employees to make payments within 20 days rather than 30, which also

assisted to decline dissatisfied customer rate. Therefore, employees being more

motivated and happy lead the organization to achieve its motives.

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HOW ORGANIZATIONAL THEORY UNDERPINS THE PRACTICE OF

MANAGEMENT (P2.2)

When applied in practice organizational theory is very important because it can

influence the overall performance of the organization. This also helps the managers

to clearly understand their role in the organization which assists to respond

sufficiently to the changes occurring in order to achieve organizational goals more

effectively. Various organizational theories are as follows:

Scientific Management

Classical Administration

Bureaucracy

Human Relation Approach

System Approach

Contingency Approach

Management Today

SCIENTIFIC MANAGEMENT

- Application of scientific methods to tasks performed

- Increase efficiency as well reduce physical strain on employees through

observation and improvements

- Information technology used to develop, modify and eliminate organizational

procedures

CLASSICAL ADMINISTRATION

- Focus in a way that leads to a better management of the organization as it

concentrates more on the role and functions of managers

Enhance effectiveness of employees and organizations based on

management practices

- Effective communication and organizing makes a successful management

BUREAUCRACY

- Emphasis on the guidelines for structuring with formalization of rules,

procedures and a clear division of labor

- Rules and regulations applied uniformly on employees keep the organization

running smoothly and efficiently

- Necessary for big governmental agencies to operate

HUMAN RELATION APPROACH

- Highlights on importance of human attitudes, values and relationships for the

participation of employees in the management

- Increases customer satisfaction and productivity through motivation and good

human relations

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- Feedbacks and support enables employees to develop their professional

capability whilst personal development is a key strategy

SYSTEM APPROACH

- System of cultural relationship that exists between external and internal

environment of the organization

- Facilitates the interaction between organization and its environment for

attaining goals more effectively

- Organizations mostly treated as open systems as it interacts with the

environment by way of inputs, throughputs and outputs

CONTINGENCY APPROACH

- Based on the theory that management effectiveness is dependant, upon the

interplay between the application of management behaviors and specific

situations

- Able to achieve the organizational goals as the managed way changes

depending on the circumstances

- Internationally operating organizations might have to adapt their structures,

managerial practices and products or services to differing cultural values,

expectations and preferences

MANAGEMENT TODAY

- Involves structures and cultures that can settle in swiftly to changes respond

to customer demands flexibly

- Employees are motivated to believe that they work for customers rather than

their managers, which increase customer satisfaction

- Commonly used in a lot of organizations especially large ones

THEORIES RELATED TO THE ORGANIZATION

Allied Insurance uses Open System Approach theory, as the company is a nation-

wide insurance organization. As this system interacts with the environment by taking

inputs of the people an output is made. This means the organization is connected

and interacts with the people, taking up their ideas and suggestions, in return

influencing the people by the organizations insurance products and insurance

schemes. Also, due to continuous feedback and responses, a better understanding

is between environment and the organization. When enough feedbacks are received,

based on this, results are produced with more clearly directed planning, constructive

products and essential services.

Human Relation Approach theory is used by Aasandha Company, since it provides

health insurance nationally. This system emphasizes human attitudes, values and

relationships of employees, meaning that regular reviews and support encourage

employees to reflect upon the contributions that they make. This also means that

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Allied Insurance

Open System Approach

Human Relation

Approach

Aasandha Company

employees are human beings and contributions to productivity is determined as

much by their physical capacity as their willingness to work. Also, without quality

workplace relationships, employees are less likely to be able to build up and

contribute to the solutions that organizations need.

DIFFERENT APPROACHES TO MANAGEMENT USED BY ORGANIZATIONS

(P2.3)

EXTENT TO WHICH APPROACHES USED BY THE ORGANIZATIONS FULFILL

ORGANIZATIONAL PURPOSES

Open System Approach is used by Allied Insurance as this approach assists in

achieving organizational goals more effectively by interacting between the

organization and its environment.

Aasandha Company uses Human Relation Approach, as this increases customer

satisfaction as well motivates the employees through good human relations whilst

attaining organizational motives more efficiently.

CONCLUSION

To conclude, I would like to say that, the current approaches used by both the

companies are the most excellent approaches. This is because these approaches

facilitated to reach the main aims and objectives of the organizations. Also, in Allied

they could approach to customers personally and ask for feedbacks which will be

more effective. In addition, management of Aasandha also can personally approach

the employees from time to time and make sure that employees remain interested

and engaged.

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REFERENCES

Dalton, Lawrence, & Lorsch, 1970. Organizational Structure & Design. s.l.:Richard D.

Irwin; Dorsey Press.

Nahavandi & Malekzadeh, 1993. Organizational Culture in the Management of

Mergers. s.l.:Quorum Books.

BPP Learning Media. 2010. Business essentials: organizations and behavior.

London: BPP Learning Media.

Kondalkar, V.G. 2007. Organizational Behavior. New Delhi: New Age Publications

Miner, B. J. 2002. Organizational behavior: foundations, theories and analyses.

[Online] Oxford: Oxford University Press. Available through: Questiaschool.com

website http://www.questiaschool.com/read/105078997/organizational-behavior-

foundations-theories-and [Accessed: April 25, 2015]

Law Teacher. November 2013. Compare And Contrast Different Organizational

Structure And Culture Law Essay. [online]. Available from:

http://www.lawteacher.net/free-law-essays/international-law/compare-and-contrast-

different-organizational-structure-and-culture-law-essay.php?cref=1 [Accessed 8

June 2015].

Class Resources

http://aasandha.mv/

http://allied.mv/