Description

Principles of Management

Jun 2026 Examination

 

 

Q1. A leading retail company regularly makes small operational decisions (such as restoring supplies) and also major strategic decisions (such as entering a new geographic market). Recently, management observed that routine decisions are handled smoothly using fixed rules and procedures. However, major strategic decisions often create confusion and take a long time to finalize. The Chief Operating Officer (COO) wants to improve the company’s overall decision-making by using different approaches for different types of decisions. Based on your understanding of programmed and non-programmed decisions: Suggest how the company should handle operational and strategic decisions differently. Explain which decision-making models or tools can be used for each type of decision and why? (10 Marks)

Ans 1.

Introduction

Every organization makes decisions at multiple levels simultaneously, and not all decisions deserve the same process, time, or tools. Herbert Simon’s classification of programmed and non-programmed decisions provides the most useful framework for understanding why the retail company’s routine decisions work smoothly while strategic decisions create confusion. Programmed decisions are repetitive, routine, and handled through predefined procedures. Non-programmed decisions are novel, unstructured, and require judgment, analysis, and deliberation. The COO’s challenge is to design distinct decision-making architectures for each category rather

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Q2 (A). A rapidly expanding retail company is restructuring its organization to improve coordination and performance. Management is considering widening the span of control, redefining reporting relationships, and reorganizing departments based on product lines instead of regions. Using the concepts of span of control, chain of command, and departmentalization, evaluate how these structural changes may affect the organization’s efficiency and coordination. (5 Marks)

Ans 2(A).

Introduction

Organizational structure determines how work is divided, coordinated, and controlled. For a rapidly expanding retail company, the three proposed changes, widening the span of control, redefining reporting relationships, and shifting from regional to product-based departmentalization, each have meaningful implications for operational efficiency and cross-functional coordination that must be evaluated carefully before implementation.

Concept and Application

 

 

Q2 (B). A multinational corporation is planning to expand into three new international markets over the next five years. The executive team is considering the development of strategic, tactical, operational, and contingency plans to support this expansion. Explain how these different types of plans are connected to each other. Why is coordination among them important for successful expansion? (5 Marks)

Ans 2(B).

Introduction

International expansion is a multi-year, multi-level organizational undertaking that cannot be managed through a single plan. The four types of plans, strategic, tactical, operational, and contingency, address different time horizons and levels of organizational detail. Their power comes not from each plan individually but from how they connect and reinforce each other as an