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Section 1: Business Acumen (35%), Globalization - Coggle Diagram

- - - - COSO Internal Control Framework
        Aim: Evaluate Internal Controls
        5 Components required for adequate governance, risk mgt & IC:
        
        Control Environment
        
        Risk Assessment
        
        Control Activities
        
        Info & communication
        
        Monitoring Activities
        
        Entity structure depends on:
        
        Entity
        
        Division
        
        Operating units
        
        Function
      - CAE's role in strategic objectives:
        
        Establish risk based plan to determine priorities of IAA, aligned to org's goals
        
        Ensure that risk based plan is aligned with these goals
        
        Consult with board & SMT & obtain an understanding of the org's strategies
        
        Review & adjust the plan as necessary in response to changes in the org's biz risk, operations, prog, systems & controls
  - - - Systematic way to monitor quality & make continual improvements:
        1. Benchmarking - compare org practices against best practices of 1/more comparable org
        2. Quality approaches - Use Total Quality Management (TQM)
        3. Improvement process - Implement 6 Sigma to improve processes by eliminating defects & lean, seek ways to improve processes by reducing waste
    - - 4 Steps to establish effective performance measurement process for IAA:
        1. Define Effectiveness: To link to achievement of area's objectives, link to org's overall objectives, ensure completeness to meet overall objectives
        2. Identify key Internal & External stakeholders: Internal (board, SMT, Ops, Support mgt, sales, Finance). External (Customers, stakeholders, vendors, regulators, EA)
        3. Develop KPIs for Effectiveness & Efficiency:
        
        allow mgt to detect shortcoming in execution
        
        plan remdial action
        -KPI measures outcomes, process characteristics (timeliness, accuracy), quantitative (% of customers who pay), qualitative (red flags), risks
        4. Monitor & Report Results
        
        Balance Scorecard
        Aim: Develop specific KPI from 4 different perspectives
        
        Financial needs
        
        Customer satisfaction
        
        Business processes
        4.Learning & growth to ensure CI
        
        Company use BSC when:
        
        Embrace sustainability
        
        Corporate social responsibility (include in reporting to external stakeholders)
  - - - 1. Hierarchy of Needs (Maslow)
        
        helps managers determine what strategies to motivate employees
        
        5 ways to meet individual's needs:
        1. Self Actualisation Needs: Personal growth (Challenging assignments, Prof dev. opp, leadership opp)
        2. Esteem needs: Self Respect, Status, Reputation, Recognition (Promotion, Job titles, Special Recognition, Rewards)
        3. Social/ Belonging needs: Sense of belonging, friends (Employee ori prog, Peer mentor coaching, Social functions, Work teams)
        4. Safety Needs: Safe Environment, Financial security, Protection (Safe Physical environment, Job security, Job benefits)
        5. Physiological Needs: Sufficient earnings, breaks, refreshments, health & wellness prog
      - 2. Motivation - Hygiene Theory (Herzberg)
        
        2 Factors in a work environment that cause employee
        satisfaction/dissatisfaction
        
        Hygiene factors must be provided to prevent dissatisfaction. Additional motivation factors to be provided for job satisfaction
        
        1. Hygiene (survival)factors: Cannot provide job satisfaction, only prevent dissatisfaction. To have Org policies, Manager/supervisor r/s, working conditions, salary & benefits
        2. Motivator (Personal Growth) factors: Create job satisfaction, if factors not there, create dissatisfaction. To have achievement, recognition, responsibility, training/development, advancement
      - 3. Theory of Needs
        1. Achievement: Need accomplishment (want feedback on their progress)
        2. Affiliation: Need interaction with others (seek acceptance, develop friendships, corporate well with others)
        3. Power: Need power & Authority (want to lead, influence & make an impact). Recognition & status are impt
      - 4. Theory X & Y
        
        2 basic approach based on assumptions about employees:
        
        1. Theory X: Employee dislikes & avoid work, Little ambition & prefers to be directed, Must be persuaded to achieve org goals, Seeks security
        
        Leads to authoritarian mgt style, exert higher level of authority
        
        2. Theory Y: Employee enjoy work, motivated by rewards, seeks responsibility, when committed are self directed
        
        Leads to participative style, encourage high level of employee participation, more positive approach
      - 5. Org. Mgt Style
        4 Different Org. Mgt style:
        1. Exploitive - Authoritative system: Leaders have authority, decisions are imposed, threats are made. Little communication & no teamwork
        2. Benevolent - Authoritative system: Leaders have authority, motivation comes through rewards. Little communication/teamwork
        3. Consultative system: Leaders trust in employees & motivation comes through rewards. Some communication & some teamwork
        4. Participative system: Leaders have FULL TRUST in employees, rewards & goals are set in mutual discussion. Much communication & teamwork
      - 6. Expectancy Theory (Vroom)
        
        Implication: Act on promises to deliver rewards in a timely manner & discern (judge) which rewards are most valued
        
        Assumption that employee's motivations & actions are choices based on 3 beliefs:
        1. Expectancy: High expectation that effort will produce successful outcomes & rewards
        2. Instrumentality: Strong belief that rewards will be received if effort is exerted
        3. Valence: How strongly rewards are valued & desired
      - 7. Equity Theory (Adams)
        
        Employee's expectations will be rewarded (outputs) fairly for their contributions (inputs) to org.
        
        Employees seek fair balance of inputs & outputs
        
        Rewards are overcompensated: Ind. may try to increase their efforts to match output
        - Unfair rewards: demotivated
        - Fair rewards: Likely to be motivated & content & maintain their contribution
      - 8. Goal setting Theory
        - Set specific & challenging goals: Improved performance
        - More challenging goals: Higher performance outcomes (unless unrealistic goals)
        - Feedback: Adjust indiv performance & reach goals
        - High employee participation in goal setting: helps info exchange
      - 9. Reinforcement Theory
        
        behavior modification technique:
        
        1. Positive Reinforcement: encourage repeat behavior in future
        2. Negative Reinforcement: Undesirable consequence to encourage desired behavior in future. Result in negative condition being avoided/stopped
        3.Extinction: Remove consequence to discourage behavior (ignore)
        4. Punishment: weakens a behavior
    - - Org. Structure & Culture
      - 2. Org Politics
        
        Informal structures of power & influence to obtain various objectives:
        
        Obtain self interested/ unsanctioned goals
        
        Achieve org goals using unsanctioned methods
        
        Find solutions/compromises when there are multiple competing interest
        
        Traits Theory
        
        Help to determine whether a person would make a good leader:
        1. Extroversion: outgoing, assertive, willing to socialize
        2. Agreeableness: a person is cooperative, helpfully disposed & trusting
        3. Conscientiousness: Persistent, dependable & reliable
        4. Neuroticism: Can remain relaxed, secure, free from worries
        5. Openness: open to new experience, broad minded, imaginative, curious
      - 3. Performance Management Techniques
        Aim: minimize unintended consequences & org risk
        - Performance feedback: vital component in motivational behaviour
        - Constructive feedback: for employees to learn, grow & take corrective actions. Opportunities should be taken to praise, recognise & celebrate success & use appropriate reward system
      - 4. Job design:
        
        Job enlargement
        
        Job Rotation
        
        Job enrichment
  - - - Good leadership skills requires personal influence and is:
        
        power associated with individual rather than position
        
        make wise & fair decisions over time based on knowledge & experience
        
        use rational persuasion
        
        use rhetoric to make goals seem both desirable & achievable
      - Leadership Theories
        
        Form a foundation for org leadership & mgt
        
        1. Trait Theory
        
        some people are born with certain traits/characteristics that make them naturally good leaders
        
        2. Behaviour Theory
        2.1 UoM: 2 form of leadership behaviour
        
        Focus on the job (job centered): getting work done, coach employees to complete task
        
        Focus on employee (employee centered): Focus on person & group performance
        
        2.2. Ohio: 2 types of leader behaviour
        **- Considerate behaviour: consider employees feeling & show caring attitude - Initiating structure**: use schedules, rules, other means to ensure that employees complete their work
        2.3 Leadership grid
        - Country club Mgt: low concern for task, high concern for people. Friendly environment, lack of attention to task
        - Improvised mgt: low concern for people & task. Work is done with minimal effort & minimal direction to people
        - Authority Compliance mgt: High on task, low concern for people. not very collaborative
        - Team Mgt: High concern for people & task. Work is productive, supportive individual & team environment is encourages
        - Middle of the road mgt: middle of the grid
        
        3. Participative Leadership
        
        encourage employees to be involved in decision making efforts of org
        
        2 types of leadership styles:
        1. Autocratic: Decision made alone (high decision making power)
        2. Participative: Individual/team decisions
        
        3.1 Likert Leadership styles (based on decision making):
        
        exploitive authoritative
        
        benevolent authoritative
        
        Consultative
        
        Participative
        
        3.2: Lewin identified 3 leadership styles:
        1. Authoritarian leader: Makes all the decisions, select team members, does not participate in groups
        2. Democratic leader: Encourage team decision making, allow team to manage its own task, shares opinions & ideas with team
        3. Laissez-faire Leader: allow team complete freedom for decision making task, assist by request
        
        Participative & democratic style is most effective (assuming employees participate in decision making)
        
        4. Contingency & Situational Theories
        
        take into account the context/situation leader is in
        
        4.1 Fiedler LPC model
        
        Effectiveness of leadership is based on leader's personality (task/r/s orientation) & how favourable the situation is
        
        3 factors that determine how favourable/easy to manage in s situation:
        1. Leader member relations: Trust & r/s are with employees. Better the r/s, more favourable the situation
        2. Task Structure: Structured task are more favourable as unstructured task require more direction
        3. Leader position power: Stronger position power, more favourable situation
        
        *leader's style does not change
        
        5. Influence & Power Theories
        
        Effective leader influences others in the org to accept change, make decision, implement the result of the decision
        - Influence: ability to affect thinking, attitudes & behaviour change in org
        - Power: Ability to influence others
        
        5.1 Transformational Leadership
        
        Influence, transform, change in employees & work environment
        
        inspire others towards vision that are better to move org forward
        
        helps employees to see larger picture for org, inspire individual org towards goals, promote collaboration
        
        5.2 Charismatic Leadership
        
        goes hand in hand with transformational
        
        are enthu & energetically communicate org's vision
        
        5.3 Baes of power (social power)
        1. Legitimate power: From authority & position, employees may comply but not feel committed
        2. Reward power: Power over resources & rewards in org (e.g promotion)
        3. Coercive power: power to force an employee to comply/administer noncompliance punishments. Threats to punish/withhold rewards & promotion
        4. Expert power: Have special knowledge/abilities, may choose how much they are willing to share their expertise
        5. Referent power: employees respect & admire him/her. Develops overtime as trust & respect grows
      - Coaching vs Mentoring:
        - Coaching: Specific advising for new learning & improved work performance
        - Mentoring: Developed certain expertise & shares these expertise with a person (ST in nature)
- - - - Centralised(Traditional):
        
        Several level of authority
        
        Long chain of command
        
        Narrow span of control
        
        Decision making concentrated in higher levels of mgt hierarchy (top down, employees have little autonomy & must gain approval for actions)
        
        Advantage:
        
        Management consistency & control
        
        Economies of scale (reduce cost due to resource sharing)
        
        reduce duplication effort
        
        Elimination of unsuccessful;/inessential ops
        
        Disadvantage:
        
        Slower decision making/ response
        
        Low employee participation
      - Decentralised:
        
        Shorter chain of command (Fewer level of authority)
        
        Wider span of control
        
        Decision making disperse in lower levels of org
        
        Employees given more freedom to take action
        
        More flexible & adaptable in the changing world
        
        More timely & responsive decision making that can leverage on local expertise
        7.Bureaucratic (bottom up & lateral communication)
        
        trends moving towards decentralised
        
        Good for merger & acquisition
        
        to minimize complexity, allow each leader of each BU to apply local expertise in decision making
        
        have a hybrid structure (centralized structure for selected function),
        
        Advantage:
        
        Higher employee participation & satisfaction
        
        Faster decision making/response
        
        better use of HR
        
        Positive for morale
        5.Reduce pressure on SMT
        
        Disadvantage:
        
        Loss of EOS
        2. Less control over productivity & efficiencies
        
        decrease in understanding of overall goals
    - - 1 - Functional Structure
        e.g Finance, marketing, manufacturing
        Advantage: specialized & control biz activities
        Disadvantage: Narrow perspective in org
      - Divisional Structure
      - Matrix Structure
    - - 1. Development of goals & objectives: set strategic objectives aligned
        to org goals
        2. Event identification (or risk identification): Understand how 1 event can lead/relate to other across the org so the risk mgt efforts are appropriately coordinated
        3. Risk response (or risk treatment): how to best manage risk
        4. Control Activities (monitoring & review of framework): To ensure risk response are appropriately carried out in support of related objectives
        5. Information & communication: An info infrastructure must capture data in a timely manner & level of detail appropriate to org's needs to identify events & respond to risks
        
        Monitoring (monitoring, review & CI):