Summative Assignment
ITBFDR
finalsum.pdf
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Learner Instructions
Section A: Multiple Choice Questions
The questions in this section test your ability to apply your knowledge. Read and study the applicable case study carefully. Read the questions that are based on that case study. Select the correct answer and indicate your answer on the corresponding number on the red assignment cover sheet that was posted with this assignment. You have to mark your answer under Section A on the second page of the red assignment cover sheet.
Section B and Section C: Discussion, Research and Experiential Learning Questions
For these sections you have to type your answers to the questions on a blank page. Answers to the assignment questions for Section B and Section C must be typed as this eliminates the possibility of an assessor marking the answers incorrect due to the illegibility (unclearness) of your handwriting. Computer literacy is an entry requirement for the programme.
Each question must be clearly numbered.
Draw a line after each answer.
U se single sheets, front side only. (Double pages must be cut loose on the sides)
When you are asked to list or to explain in a question you have to use your own words to reflect your understanding and your knowledge.
Font size 12.
Font type Arial.
Keep the mark allocation in mind when answering a questions to ensure that your answer contains sufficient facts.
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Results of your assignment: Your final mark will be outlined in a results letter that will be posted to you.
To pass, you need a result of 65%.
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Section A: Multiple Choice Questions Study the following case study and then complete the questions on the case study by marking the correct answer on section A of the red assignment cover sheet.
Case Study 1: Leisurenet
For a few weeks in September and October 2000, Peter
Limited (again as joint chief executive officer) and the
Flack was interim chief executive officer of the ill-fated young managing director of the South African operations
LeisureNet. He had been called in as a turnaround had been approached to take the job as CEO of
specialist. He found that the company had deteriorated so LeisureNet. However, he had not accepted the position
far and so fast that all that could be done for it was to close and the terms of his appointment had not been finalised.
it. So clearly there was a question of leadership. The previous
LeisureNet was a large business, but the lessons Flack leaders had sold almost all their interests in LeisureNet and
draws from the LeisureNet failure need to be learned by had been awarded a substantial and meaningful stake, free
every entrepreneur and manager. This is his account of of charge, in Healthland International Limited.
one of South Africa’s most spectacular corporate failures: Part of the conflict at board level was due to the fact that
Every organisation, whether it be a club, church, company LeisureNet had been used to fund, staff and train
or country, requires four basic ingredients for it to be employees of Healthland. The H&R Club business had
been pillaged to establish Healthland’s operations and all
successful. They are leadership, a strategic plan, a available cash had been invested in Healthland and little, if
management team capable of implementing the strategy, any, in the H&R Club business. Some R370m of this
and an action plan which breaks the strategic plan down available cash had come from selling shares. The result
into measurable bits. This is the basis against which a was a lack of maintenance and refurbishment at H&R
business is measured. Clubs. LeisureNet, a successful and profitable company, invited
On closer examination, there was no strategic plan. A
one of the directors of Coronation FRM to sit on their
board. A brief look at the results for the year to December strategy, which is not reduced to writing, is a hope, wish or
1999 showed a group which turned over in excess of R1bn prayer but not a plan. A strategic plan requires that its
and which made in excess of R100m after tax. As a rough participants go through a procedure which identifies and
rule of thumb, we have always said, “show us a company analyses the various internal and external issues which
which produces after-tax profits equal to 10% of gross affect the business.
revenue and we will show you a healthy business”. The lack of a coherent strategic plan in LeisureNet can be
The company operated 85 Health & Racquet (H&R) Clubs seen from the fact that over the last five years the company
in South Africa and employed some 4 500 people who has, in addition to the health and fitness business,
provided an excellent service to nearly one million club embarked on a food business, golfing business, an
members. In addition, the company had recently education business, a casino bid, a gymnasium equipment
expanded offshore and had built 22 H&R Clubs in supplier, a restaurant and the six member Imax theatre
Australia, Britain, Germany and Spain, with a number in chain. Despite the fact that LeisureNet owned only half the
the process of construction. On the surface, LeisureNet equity of the Imax group, the company guaranteed 100%
was a company with strong leadership, a clear strategy of the leases of the purpose built facilities housing the
and an obviously competent management team. theatres and which extended over 13-20 years.
At the first board meeting that we attended, accusations Structure follows strategy and the lack of strategy
were leveled at executive and non-executive directors alike manifested itself in the composition of the board of
and it appeared as if the board had become dysfunctional. directors of LeisureNet. Instead of the various disciplines
The previous joint chief executive officer of LeisureNet had inherent in a company being represented on the board of
been transferred recently to Healthland International directors, for example finance, information systems, human
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Case Study 1: Leisurenet
resources and the line operations, the board consisted of
The group, with the notable exception of the H&R Club
two former joint chief executive officers, the MD of the local business, did not meet, let alone pass, any of the
operations and a host of non-executive directors. standards required by the four components for any
Although the management information system was home successful business, namely leadership, strategic planning,
grown and, in many instances, required a duplication of management and action planning. There were two other
effort, the accounting system, sales system, marketing and glaring omissions in the field of corporate communications
human resources procedure were well thought out. In and corporate governance.
moving offshore, the business there had adopted the best The group could have been saved had it been possible to
of the local operating systems, acquired a standard raise sufficient money to complete the building of the
management information system and had recruited the Healthland clubs under construction, or if the sale of these
most senior of the local managers. The glaring omission, offshore clubs could have been concluded in a way which
however, related to the position of chief financial officer would have released LeisureNet from its obligations to the
and the treasury and cash management functions for this Healthland group. In the end, both attempts failed. Both
massively cash hungry growth business in a state of rapid these failures can be traced back to fundamental flaws in
development. Ultimately, this gap in the management the issues of leadership, strategy, and corporate
structure caused the downfall of Healthland. Finally, there communications.
was no action plan of any kind. (Source: Adapted from Flack, P. 2001. Death of a
Business. Succeed Magazine, June/July.)
Nr Question Mark:
A lack of _____ skills among LeisureNet’s board of directors can be singled out as the main cause for the
company's failure.
a. interpersonal
1. b. decision making 2
c. technical
d conceptual
LeisureNet’s board of directors was responsible for:
i designing the organisation’s broad organisational structure
iidetermining the organisation’s vision, mission, goals and overall strategies
iii implementing policies, plans and strategies
2.
iv organising the organisation’s functional areas 2
vinfluencing the corporate culture
a. i, ii and iii
b. i, ii and v
c. ii, iii and iv
d. iii, iv and v
7 Nr Question Mark:
LeisureNet’s lower levels of management were responsible for:
i. medium-term planning
ii. applying policies, procedures and rules to achieve a high level of productivity
iii. organising functional areas
3. iv. providing technical assistance
2 v. monitoring environmental influences that may have affected functional areas
a. I and ii
b. ii and iii
c. ii and iv
d. iii and v
The failure of LeisureNet affected nearly one million members of the H&R Clubs. This is an example of a
variable in the ______ environment that influences the _____ environment.
a. market; macro
4. b. micro; market 2
c. micro; macro
d market; micro
When deciding to expand offshore, LeisureNet needed to plan the future allocation and utilisation of various
resources with regard to different organisational activities over a given period. This refers to the following
planning tool:
5. a. forecasting 2
b. budgeting
c. scheduling
d. monitoring
LeisureNet’s management needed to think about ways to carry the organisation into the future. This is
referred to as the _____ of an organisation.
a. vision
6. b. mission 2
c. strategy
d action plan
Financial results for the year to December 1999 showed a group which turned over in excess of R1bn and
which made a profit in excess of R100m after tax. This can be considered as a(n)____ for LeisureNet.
a. strength
7. b. opportunity 2
c weakness
d threat
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Nr Question Mark:
LeisureNet’s failure can be traced back to fundamental flaws in the issues of leadership, strategy and
corporate communications. Which of the following are components of leadership?
i. authority
ii. power
iii. influence
iv. delegation
8. v. responsibility 2
vi. accountability
a. i, ii, iv and v
b. i, iii,iv,v and vi
c ii, iii, iv, v and vi
d i, ii, iii, iv, v and vi
Poor communication was identified as a reason for LeisureNet’s failure. Which of the following interpersonal
factors might have been a barrier to effective communication in the company?
a. perception
9. b trust 2
c. spatial constraints
d status
The first and most important requirement to foster a culture of good ethics, which was not present at
LeisureNet, is for the chief executive officer and senior managers to be openly and strongly committed to
ethical conduct and to provide constant leadership in reinforcing ethical values in the organisation. This is
referred to as _____.
10. a. a code of ethics 2
b. ethical structures
c. leading by example
d whistle blowing
Financial control concerns the control of resources as they flow into the organisation, such as _____,
financial resources that are held by the organisation, such as _____, and financial resources flowing out of
the organisation, such as _____.
11. a. working capital and cash; revenues and returns on investments; salaries and expenses 2 b. revenues and returns on investments; working capital and cash; salaries and expenses
c. salaries and expenses; revenues and returns on investments; working capital and cash
d. revenues and cash; return on investments and working capital; salaries and expenses
The satisfaction that the workers get from their work refers to the need for _____, identified by _____
theory of motivation.
a. esteem; Maslow’s
12. b. power; McClelland’s 2
c. affiliation; Herzberg’s
d. self-actualisation; Maslow’s
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Nr Question Mark:
According to the content theories of motivation, employees will be highly motivated if ____.
a. their power and expectancy needs are satisfied
13. b. desired behaviour is rewarded positively
2 c. their achievement needs are satisfied
d. the employees behave according to their perception that their behaviour will lead to a certain desired
outcome
According to the reinforcement theory of motivation, employees are highly motivated when ____.
14. a. their power, achievement and affiliation needs are satisfied 2
b. desired behaviour is rewarded positively
c. they are satisfying their esteem and self-actualisation needs
Case Study 2: Microsoft
Microsoft launched a new program, COMP2000, which
At the head of the company is Bill Gates, who publicly
re-aligned the salary structure, raised the base-pay level, and changes his mind and the course of the company. He
significantly raised salaries throughout the company. In this redirected Microsoft from a company totally focused on
economic climate, with stiff competition in the high-tech dominating the desktop to one that accepted that the Internet
industry, we have to get more creative and more radical to was the next big technological wave. In his so-called Pearl
attract and attain talent. Microsoft’s bottom line is all about Harbour speech of December 1995, he posed the new
people: attracting the best talent, keeping them there and question, answered it and directed the enterprise to pursue
helping to ensure they stay engaged, focused and committed the new goal.
Read Case Study 2 and then complete the questions on the case study by marking the correct
answer on section A of the red assignment cover sheet.
Nr Question Mark:
Bill Gates created a progressive company such as Microsoft, functioning in a dynamic environment. He
displays the characteristics of a _____leader, who is distinguished by the ability to bring about innovation
and change.
15. a. charismatic 2
b. transformational
c. transactional
d. interactive
Bill Gates redirected Microsoft from a company totally focused on dominating the desktop to one that
accepted that the Internet was the next big technological wave. He made a ______ decision, under
conditions of _____.
16. a. programmed; certainty 2
b. non-programmed; certainty
c. programmed; risk
d. non-programmed; uncertainty
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Nr Question Mark:
Bill Gates has _____ power based on his knowledge and expertise. a. referent
17. b. legitimate 2 c. coercive
d. expert
Case Study 3: South African Airways
South African Airways (SAA) is currently a major player in the
areas, including the development of alliances. Routes and
global village. One of the major thrusts of the airline's vision markets were added at rates that astounded global industry
for the future is continued global expansion in conjunction experts. From serving 70 markets a few years ago, SAA, with
with strategic airline partners. It understands that strategic partners, currently serves more than 503 cities.
contemporary customers want a high level of customer Instead of a disjointed approach into other continents, SAA
service, not just on board but also regarding check-in and has moved towards using someone else's hub on someone
frequency of flights available to most major destinations. else's continent with starbursts of destinations radiating from
major centres.
To achieve this, the mission of South African Airways is to be
Africa's leading airline, and the carrier of choice in the An additional flight frequency to London and a new
markets it serves. On 1 April 1999 South African Airways - destination to Milan were recently added so SAA's routes.
formerly a division of Transnet - entered a new era of Expansion programmes into Africa are also being evaluated.
privatization and was renamed South African Airways (Pty) The increase in tourism and the New Partnership for Africa's
Ltd. The mission's critical aspects of transforming SAA into a Development (NEPAD) should have a positive effect on
world-class airline will be achieved by focusing on strategic earnings.
decision-making areas which are part of SAA's strategy of
"perfecting the basics" to improve the airline's profitability. Concerning corporate governance, the third focus area,
The key areas of focus include: the fleet-renewal plan SAA's Board of Directors and management are committed to
development of alliances, cost-cutting measures, and service the highest levels of corporate governance and compliance
improvements. According to its customers it has made major with the provisions of the Public Finance Management Act.
advances, but SAA believes that there is still room for SAA also increased revenue by 26.1 per cent for the year
improvement in order to reach its goals. 2001, despite continued difficult market conditions. The
increase was mainly attributable to increased passenger
One of the first focus areas will be fleet renewal. SAA revenue, cargo revenue, and third-party maintenance work
operates a fleet of 62 aircraft. As part of SAA's strategy to performed. Furthermore, SAA is expanding its e-commerce
create a standard and efficient fleet, a major deal was activities. Whilst online booking levels were initially low, they
concluded with Airbus to renew the entire fleet over a period have increased rapidly. These are highly efficient sales as
of 10 years. In order to retain and regain premium administration and commission levels are reduced.
passengers on key routes, SAA embarked on a programme
to upgrade its fleet of eight Boeing 747-400s with new The fourth key focus area for transforming SAA into a world-
seating and in-flight entertainment systems. class airline has been the emphasis placed on passenger
services. From the moment the passengers enter the airport
These aircraft will be operated until 2006, at which time it is to the moment they leave their destination points, SAA's
the intention to replace them with additional A340-600s. SAA Global Passenger Services are there to ensure that their
will then have the youngest, most technically advanced fleet travel experience is as pleasurable and stress-free as
in Africa. possible. Historically, airlines paid scant attention to the
negative physical and psychological impact on passengers of
The second focus area involves better planning and standing in long queues at check-in counters or experiencing
efficiency. There have been major improvements in several similar frustrations when retrieving their luggage after flights.
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Case Study 3: South African Airways
The focus is currently on managing these processes so that information facilities such as phones, faxes, and Internet
the entire travel experience is as relaxed, pleasant, and connectivity. Additionally, SAA's Business Class Lounges
trouble-free as possible. have been designed so that customers can experience these
facilities without being separated from family members
One of SAA's challenges is to ensure that everything travelling with them. Customer lounges at Johannesburg
contributing to a customer's travel experience on the ground, International and Durban Airports have been developed over
be it check-in, aircraft handling from a baggage onload/ the past 18 months at a cost of R13 million. Five more
offload point of view, or even apron services such as domestic facilities have also been also upgraded, as has the
bussing, meets above-average standards. Central to this ground-breaking SAA lounge facility at London's Heathrow
process has been SAA's multi-million rand investment in Airport. With the lounges completed, the future strategy is to
customer facilities at airports. SAA has therefore established concentrate even more on service.
a seamless and linear service for its premier customers,
starting with check-in services prior to check-in - high-value
customers are contacted to check on special needs or meal With the drive to revamp customer service, service-level
preferences before coming to the airport. The entire process agreements are being introduced and a Global Passenger
is managed seamlessly to minimize customer discomfort and Service Training Centre has been established, where
to enhance the travel experience from SAA's curb-side approximately 710 candidates have undergone training to
concierge check-in service, through dedicated immigration, improve their skills and morale. Customer-service standards,
to the First Class lounges, and, finally, onto the aircraft. known as "Touch Points", have been introduced to improve service levels of all staff - SAA views this as a major
The same principle is being carried into SAA's Business enhancement to complement the arrival of its new fleet.
Class, where business travelers require communication and (Source: http://www.saa.co.za)
Read Case Study 3 and then complete the questions on the case study by marking the correct answer on section
A of the red assignment cover sheet.
Nr Question Mark:
In formulating their vision, mission, goals and strategies, SAA tries to maintain a balance between the
various parts of the organisation as well as between the organisation and its environment. This is known as
the _____ approach to management.
18. a. systems 2
b. quantitative
c. contingency
d. bureaucratic
SAA’s mission is to be Africa’s leading airline by focusing on strategic decision-making areas, which
involves everyone and all activities in the organisation. They want to meet customers’’ agreed requirements,
at the lowest cost and manage quality effectively. This is known as _____.
19.
a. re-engineering 2
b. the learning organisation
c. total quality management
d. situational management
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Nr Question Mark:
SAA implemented a computer network that links them with their employees, suppliers, customers and other
key stakeholders electronically. This is called _____.
a. the Internet
20. b. the extranet
2
c. e-commerce
d. the intranet
When SAA needed to decide whether they should renew or replace their fleet of aircraft, they used
electronic spread sheets that allowed them to receive interactive responses to ad hoc requests for
information posed as a series of ‘what-if’ questions. SAA used the following type of information system:
21. a. information-reporting system
2
b. decision support system
c. executive information system
d. expert system
Study the following plans of SAA to answer question 22-25 on the red assignment cover sheet:
i Renew the entire fleet of aircraft over a period of ten years. ii Form strategic alliances to expand the market from serving 70 to more than 503 cities within five years. iii Increase revenue by 12 percent within the next year. iv Develop customer lounges at Johannesburg International and Durban Airports over the following 18
months with a cost of R13 million. v Establish a Global Passenger Service Training Centre to train 170 candidates over the next 6 months
to improve customer service.
Nr Question Mark:
Which of the plans listed above are examples of SAA’s strategic plans?
a. i and ii
22. b. i, ii and iii 2
c. iii and v
d. iv and v
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Nr Question Mark:
Which of the plans listed above are examples of SAA’s tactical plans?
a. i and ii
23. b. ii and iii 2
c. iii and iv
d. iii, iv and v
Which of the plans listed above are examples of SAA’s operational plans?
a. iii and iv
24. b. iii and v 2
c. iv and v
d. v
Which of the plans listed above are not specific and measurable?
a. i, ii and iii
25. b. ii, ii and v
c. iii and iv
d. All the plans are specific and measurable
Total for Section A 50
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Section B: Discussion Questions
Complete this section by typing your answers on a blank page and insert it into the assignment
cover sheet
Nr Question Mark
1. Name five major forces of change that are impacting on the South African business environment and explain 10 how a business of your choice is adapting to these forces.
Explain (give reasons) which situational leadership style you will use in each of the following scenarios:
A. You have been appointed as supervisor in the maintenance section and want a 45 year old
cleaning lady who has been working for the business for 10 years, to prepare the presidential suite
for the Minister of Health who will be arriving in two hours’ time. She is very negative because she
also applied for your job but you know that she is an excellent worker. (5)
2. B. You are in charge of a group of sales people. They are all experts in their field and highly 15 motivated. The CEO however is unhappy because one of them has a tendency to over-promise and thereby sometimes put the rest of the staff in difficult situations. You have to address this issue and
ensure that it does not happen again. (5)
C. A new member has joined your team two days ago. She has no experience or knowledge about
events management or conferencing. All your experienced function coordinators are busy preparing
for large functions and you have to assign a last-minute booking for your board room to her. She is
quite intelligent and willing to work. (5)
3. Diagrammatically depict the Group Behavioural Model and explain what all the variables in the model entail. 15
4. Explain how the various motivational theories differ in their view on the use of money as a motivator. 10
Total Section B 50
15 Section C: Research and Experiential Learning
Complete this section by typing your answers on a blank page and insert it into the assignment
cover sheet
Nr: Question: Mark
Write a short essay of approximately 800 words (3 X A4 typed pages – Arial 12) about the virtual workplace.
The following must be clearly explained in your essay:
1. Features and benefits of the electronic office (5) 25 Features of the virtual workplace (5)
The feasibility of a virtual workplace (5)
you think that such a workplace will or will not work in a company of your choice (10)
Identify an entrepreneur who has, within the past 2 to 5 years, started a business whose sales now exceed R300 000 and are profitable. Select an entrepreneur from whom you wish to learn and would like to interview. Then you have to write a two page report and hand it in as part of this assignment.
The following should be covered in your report: Background that the entrepreneur came from, Education of entrepreneur, Experience and or lack of experience, Opportunity observed and utilised, Planning that went into the venture and still needs to be done Funding, Support, Success What surprised you most? What was confirmed about what you learned/know about entrepreneurship?
Follow these steps to help you with your report: 2. 25
STEP 1: Contact the selected person and make an appointment. Give a realistic estimate of how much time you will need.
STEP 2: Identify specific questions you would like to have answered and the general areas about which you would like information.
Some questions that may help you in your interview:
Please tell me about the days before you started your first venture. Were there any people who started or owned a business while you were growing up? How did they influence you? Did you have role models? Did you work at any business during your youth? Did you have your own business during your youth? What kind of education did you receive? Was it useful? Did you have any sales or marketing training and/or experience? How important was it or the lack of it, to starting your business?
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Section C: Research and Experiential Learning Complete this section by typing your answers on a blank page and insert it into the assignment cover sheet
Nr: Question: Mark
How did you decide to create a business instead of taking a job at an existing business? How did you spot the opportunity? What were your goals? How did you evaluate the opportunity in terms of your goals and vision of success? What kind of planning did you do? Did you have a business plan? Did you have partners? How did you finance your start- up? How much capital did it take? How much time did it take from conception to the first day of business? How long did it take to reach a positive cash flow and break-even? What outside help did you get? What was your most triumphant moment? Your worst?
Once your business got going:
What were the most difficult problems to solve? How did you find key people to help run the business? Do you still spend the same amount of time with your business than in the early years? Do you feel less entrepreneurial / more managerial now? Have your goals changed? Have you met them? What are your future plans for the business? (Expand? Sell?) For yourself? (Retire? When?)
Concluding questions:
What do you consider to be your most valuable asset – the thing that enabled you to make it? What were the most critical skills, attitudes and know-how you needed to get the business started and to grow to where it is today? What things do you find personally rewarding and satisfying as an entrepreneur? What were the 3 most valuable lessons you have learned? Are there any other remarks regarding being an entrepreneur that you would like to share?
STEP 3: Conduct the interview
STEP 4: Evaluate and report on what you have learned.
Summarise the most important observations and insights gained in a two page report.
Total Section C 50
Total 150
