The Managerial Or Hierarchical Constraint Business Essay


We have discussed about organizational structure, so now what about organizational culture? The cultural dimension is central in all aspects of organizational life. Even in those organizations where cultural issues receive little explicit attention, how people in a company think, feel, value and act are guided by ideas, meanings and beliefs of a cultural (socially shared) nature. Organizations practicing intensive 'numbers management' may develop and reproduce a culture celebrating performance indicators and rituals around the handling of these. In most contemporary organizations, corporate culture receives a lot of attention and is seen as crucial.


We can clearly understand that the case studies stated that there is a great shift of business from Penang to China. As a good managed company, first of all we have to know the culture and structure of business in China. So that, we can manage to cover and undergo a better systematic business organization. I have mentioned in my introduction that culture cannot be understood clearly because there are many different cultures around. According to that statement, first we going to discuss little bit about the Chinese culture. Chinese are one of the most emotionally intense and deep people in our world. Like many others, the more stereotyped views of the Chinese - their pragmatism, their ambition for skills and knowledge, the importance of money and status in their society and their apparently controlled, occasionally imperious exterior. A key cultural competency for any manager in China is managing face for her employees. Apart from that in their business terms, it is important to demonstrate humility and modesty as exaggerated claims of ability are viewed with suspicion and are likely to be looked into.

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Then, the keystone of making the Chinese system hold together is that the emperor must be the ideal of gentlemanly virtue. While loyalty works from the bottom up, corruption works from the top down, epitomized by the Chinese saying a fish starts rotting at the head. Hence, the leader of any group must present him as the embodiment of self-discipline and virtue. After that meeting attitude of them is very important. You will most likely rely on a Chinese intermediary to arrange appointments and meetings. Most Chinese company officials will be able to communicate in English, but it is best to bring your own interpreter.

Then structure of Chinese business is Chinese society and business organisations are based on a strict observation of rank where the individual is subordinate to the organisation. In the other hand, people will enter the meeting room in hierarchical order, as the Chinese are very status conscious. Senior members generally lead the negotiations and will direct the discussion. Moreover, many successful Chinese companies have a hierarchical organizational structure where top leaders steer the company direction. They lead managers and managers lead workers. It's a triangular, top-down communication from top decision makers to employees. That means only the top executives are making decisions for any project.

These are the some points about the Chinese culture and structure, but how about Penang, Malaysia? Let's discuss about it in some line. Malaysia is a multi-cultural society. The main ethnic groups are the native Malays as well as large populations of Chinese, and Indians. The family is considered the centre of the social structure. As a result there is a great emphasis on unity, loyalty and respect for the elderly. Malays, Chinese and Indians all strive to maintain face and avoid shame both in public and private. Face is a personal concept that embraces qualities such as a good name, good character, and being held in esteem by one's peers. Face is considered a commodity that can be given, lost, taken away, or earned.  Initial greetings should be formal and denote proper respect. If in a team, introduce the most important person first. Many Malays and Indians are uncomfortable shaking hands with a member of the opposite sex.

Most Malaysian businesses are extremely hierarchical in nature and indeed the three main religions of Islam, Confucianism and Hinduism all stress the over-riding importance of respect and duty. This need to show respect to which it is due will obviously manifest itself in a desire for a clearly defined hierarchy to be established where reporting lines are transparent and where bosses make decisions and then instruct their subordinates accordingly.


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In a nut shell, organizational structure and culture is very important. This is because it creates energy and momentum. The energy will permeate the organization and create a new momentum for success. It also develops organizational norms, guidelines or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another. Organizational culture is possibly the most critical factor determining an organization's capacity, effectiveness, and longevity. It also contributes significantly to the organization's brand image and brand promise. 

Organizational structure offers guidance to the employees by laying out the official protocol in the company. Through this they are able to know the reporting relationships that control the work flow in the company. Then, it allows for a flexible and complete means of growth. Therefore, operations run smoothly in the company and communication becomes easier. Moreover, an organizational structure ensures that you have an improved operational efficiency. This is because it brings about clarity to employees at each level of the company. The staff knows who to report to for guidance, supervision and submission of work.



Leadership is concerned with influencing the activities of an individual or a group for the achievement of a goal in a given situation."Leadership is the ability of a manager to induce subordinates to work with confidence and zeal"."Leadership is the lifting of man's visions to higher sights, the raising of man's performance to higher standards, the building of man's personality beyond its normal limitations." In the other word, leadership involves the exercise of influence on the part of the leader over the perception, motivation, communication, personality and ultimately over the behavior of other people (preferably followers).

Leadership is, therefore, the study of leader's influence over the thoughts, feelings, opinions, beliefs, attitudes and actions of followers. Effective leadership is as important for the survival organization as blood is for the survival of the human importance of leadership can be understood from the following. A good leader motivates employees towards higher and better performances. Motivation helps in realizing objectives and getting work done. It inspires employees and obtains their co-operation.


The theory that underpins the principles and practices that this company has taken to its management and leadership is Fiedler Contingency Theory. One of the first contingency models for leadership was developed by Fred Fiedler. The Fiedler contingency model proposed that effective group performance will depend upon a proper match between the leader's style and the extent to which the situation gives control to the leader. This model has three contingency variables namely leader-member relations or group atmosphere, task structure and leaders position power. When combined, the three contingency variables create eight situations, which will form the Fiedler's basic contingency model.

A leader-member relation is the leader's personal relations with the group members or group atmosphere can be said to be the measure of the degree of acceptance of the leader by the team. If a leader is accepted and inspires loyalty in employees, there will be little friction and the employees get along well. If it is the other way round and the leader is not accepted by the employees, then care is to be exercised to keep from having employees who will bypass the leader or sabotage the task. Then the second variable is task structure. It refers to the extent to which a task performed by employees is routine or non routine. A routine job will have clearly defined goals, few steps or procedures with a correct solution, to be performed on a daily basis. The non routine job involves tasks which are likely to have unclear or changing goals and multiple ways to accomplish the same. Last is position power and it refers to the extent to which the leader is bestowed with the ability to reward; coercive and legitimate power associated with his/her position. This power is mainly in terms of the authority to hire, reward, and fire employees.


People of higher intellect and who possess logical problem solving abilities tend to handle stress better than others. Therefore, intelligent people naturally rise to the leadership level through their innate ability to handle stress well. The theory also states that people with more experience will handle stress better than others,  and therefore more experienced people will be chosen to lead. The type of leadership that a leader in a work environment uses depends on the type of work that is being performed.  For example, task-oriented work requires task-oriented leadership. Social-oriented work requires relationship-based leadership.

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A contingency leadership style can lead to more effective and precise leadership. It can also help close relationships between workers and leaders develop more easily. The theory also allows the leaders to know the specific tasks they are responsible for without any confusion. Leaders are not discriminated against based on gender, ethnic background, social background, or even work experience. Theoretically, leaders would rise through the ranks based only on their abilities. Some people oppose the principles behind the Fiedler Contingency Theory. Many say it is inflexible in its leadership style. It does not take into account all types of jobs in existence. Determining who the leader should be based mainly on the person's ability to handle stress can lead to a flawed situation.



Alignment of aims, purpose and values between staff, teams and organization is the most fundamental aspect of motivation. The better the alignment and personal association with organizational aims, the better the platform for motivation. Where people find it difficult to align and associate with the organizational aims, then most motivational ideas and activities will have a reduced level of success. Motivation is a complex area. It's different for each person. Motivational receptiveness and potential in everyone changes from day to day, from situation to situation. Get the alignment and values right, and motivational methods work better. Motivational methods of any sort will not work if people and organization are not aligned. People are motivated towards something they can relate to and something they can believe in. Times have changed. People want more.


The first theory of motivation that I going to describe is about Maslow hierarchy of need. According to Maslow each of us is motivated by needs. He presents these needs in a pyramid form consisting of five levels. He categorized these needs as physiological needs, safety needs, belonging and love, esteem needs and self-actualization needs. (Kermally, Sultan 2005) Air, food, drink, shelter, and warmth all come under physiological needs. All individuals have these needs and they have to be met. If unfulfilled then individuals would not be motivated to move up the hierarchy. These needs constitute the general well-being of individuals. Once physiological needs are satisfied then safety needs become predominant. These needs reflect freedom from physical dangers. These needs relate to the desire to belong in a group, family, organization, relationship etc. These needs focus on the social aspects of the work and non-work environment. Organizations provide coffee breaks, organize various forms of outings, social meetings etc. in order to accommodate these needs within the work environment.

Next is esteem needs. These needs relate to the need to feel good about one's self. An individual desires to master his or her own work. He or she wants to feel confident, adequate and capable. In a work situation if these needs are not met, an individual loses confidence in him or herself and assumes a sense of inferiority. Last will be self-actualisation. "Even if all these needs are satisfied, we may still often (if not always) expect that new discontent and restlessness will soon develop, unless the individual is doing what he is fitted for. A musician must make music, an artist must paint, a poet must write, if he is to be ultimately happy. This need we may call self-actualization."These needs reflect the desire to achieve one's potential. The type of people that had self-realization and self-actualization needs were people like Abraham Lincoln, Mahatma Gandhi and Albert Einstein.

All above points were about Maslow's hierarchy of need. The next we going to go through is about motivation-hygiene theories. According to Herzberg there are two types of factors in motivation. There are those factors which if present will enhance performance and increase motivation. The first group of factors he calls motivating factors and the second group of factors he calls hygiene factors. What is factor of hygiene? These factors which promote work satisfaction include a clean and safe environment, working conditions, supervision and money. If working conditions are poor, if a situation is unsafe or if there is poor supervision then they will lead to dissatisfaction and poor performance. The hygiene factors relate to a work environment. An appropriate working environment provides workers with physiological, security and belonging needs, as explained in Maslow's theory of the Hierarchy of Needs. It provides basic needs, adequate security, a sense of belonging and comradeship.

This is about factor of motivation. These factors include a sense of achievement, advancement, job interest, recognition and responsibility. These factors are the true motivators. According to Herzberg, hygiene factors have to be attended to first before motivators start to work. Management should motivate people by paying attention to motivators. Hygiene factors have to reach a certain level first, to make sure motivation is not decreased, but after that focus should be put on motivating factors. Many managers, according to Herzberg, attempt to motivate through hygiene factors alone which is wrong and ineffective. (Kermally, Sultan 2005)


Figure 1: Maslow's Hierarchy of need

Source: (Sutton silver 2013)


Figure 2: Motivation-hygiene theories

Source: (Alan Chapman, 2001)


Figure 3: Vroom's Expectancy Theory

Source: (Seongsin Lee 2007)

Another theory is about Vroom's Expectancy theory. The Expectancy theory states that employee's motivation is an outcome of how much an individual wants a reward (Valence), the assessment that the likelihood that the effort will lead to expected performance (Expectancy) and the belief that the performance will lead to reward (Instrumentality). In short, Valence is the significance associated by an individual about the expected outcome. It is an expected and not the actual satisfaction that an employee expects to receive after achieving the goals. Expectancy is the faith that better efforts will result in better performance. Expectancy is influenced by factors such as possession of appropriate skills for performing the job, availability of right resources, availability of crucial information and getting the required support for completing the job. Instrumentality is the faith that if you perform well, then a valid outcome will be there. Instrumentality is affected by factors such as believe in the people who decide who receives what outcome, the simplicity of the process deciding who gets what outcome, and clarity of relationship between performance and outcomes.

These are the three different types of motivational theories. In my opinion it is better to apply Maslow's motivational theories in this semiconductor company in order to motivate its employees towards effectiveness. The value of Maslow's theory lies in how easily it can be applied to your interactions with others. Understanding motivation can enable you to strengthen your relationships, work more effectively with business associates, become a more capable parent, and facilitate positive change in any group. This is why I said this theory will be effective. Moreover the implication of changing the shift will be deep in the employee's self. So, knowing their negative point is very important. We can easily categorize them when we look into and divide using the Maslow's theory. For example, when we know that employee A need more safety needs then we can provide him that specific need more so that he will give more support and help to increase the productivity. Other than that, this theory have more branches, i means that its point and factors are broad compare to other theories. This will help the organization to look deeply about an employees need. In a nut shell, it helps the managers to understand the behavior of their employees. It also helps the managers to provide the right financial and non-financial motivation to their employees. This overall helps to increase the efficiency, productivity and profitability of the organization.


Good leadership demands good people-motivation skills and the use of inspirational techniques. Motivational methods are wide-ranging, from inspirational quotes and poems, to team building games and activities, as ice-breakers, warm-ups and exercises for conferences, workshops, meetings and events, which in themselves can often be helpful for staff motivation too. Motivation is the force that initiates, guides and maintains goal-oriented behaviors. It is what causes us to take action, whether to grab a snack to reduce hunger or enroll in college to earn a degree. The forces that lie beneath motivation can be biological, social, emotional or cognitive in nature. Researchers have developed a number of different theories to explain motivation. Each individual theory tends to be rather limited in scope. However, by looking at the key ideas behind each theory, you can gain a better understanding of motivation as a whole.



Handy (1993) describes a group as 'any collection of people who perceive themselves to be a group', whilst Shaw (1981) after reviewing 80 definitions of a group, says ' a group is defined as two or more people who are interacting with one another in such a manner that each person influences and is influenced by each other person'. Groups are typically separated into two main categories - formal and informal. Formal groups are the units established by the management as part of an organization structure. They are defined in terms of their purpose and roles, they are official in the sense that they have appropriate authority, and they are provided with financial and physical resources. The principal function of a formal group is to further the aims and objectives of the organization as laid down in policies and mission statements.

A functional analyses described by Cartwright and Zander (1968) describes, a group as one whose members are committed to a set of values that define the overall pattern of activity (meaning), have accumulated or generated the resources necessary for the task at hand (resources), have worked out an appropriate form of role differentiation and developed a sufficient level of morale for the task (integration) and have sufficient control in the form of leadership to coordinate the use of resources by the members to attain specific roles (goal attainment). Informal groups tend to be employee centered groups whose aims and intentions may be different to those of the official organization. They tend to draw their norms from themselves, their first loyalty is to their fellow group members, their goals are decided as to what is right for them, their behavior is derived from interpersonal relationships, they are less permanent, primarily meet social needs, and their group leadership is likely to be exercised on a charismatic basis. (Chris Hall 2004)


Formation of groups is necessary as man is basically a social being. Most of the people prefer to live and work in groups. In addition, the following factors are also responsible for the formation and development of groups. These points also can be categorized as the nature of group behavior. First is security, groups provide security to its members from others in the society, from the threats posed by other groups, insecurity caused by the environmental, climatic, life, economic, social and other factors. Then, empowerment through sharing of Resources. Groups provide facilities and opportunities to the members to exchange their skills, knowledge, talents, values etc. This process enables the individuals to gain more knowledge and acquire expertise. Thus, members gain expert power. Thus, the group empowers the members. Becoming a leader also a factor of a group.

People with leadership skills and with a desire to become a leader form the groups. They at least initially lead such groups. For example, outside political leaders used to form groups and convert these groups into trade unions during 1940s to 1960s. Groups provide the benefit of synergy. The outcome of the group effort is greater than the sum of the individual contributions of the group members. Most of the organizational goals can be achieved by the group effort as they need the integrated effort of the employees. Moreover, people possess enhanced status as a member of a group rather than as individuals. Group membership satisfies belonging and affiliation needs of the employees. Lastly is it self-esteem. Group membership provides a feeling to the members that they are more worthy as a member of a group than individually.

A team is a group of people who are mutually dependent on one another to achieve a common goal. Some definitions of a team require that the group must also be functioning well together. Teamwork is very important to create an effective working situation. The factor for effective teamwork is communication. Perhaps obviously, it would be very difficult to do anything if team members could not somehow communicate with each other, and this is the basic crux behind the reason why communication is one of the factors that promote effective teamwork. Beyond the basic need to convey directions and share information, though, is also the necessity for some people to provide ideas, others to interpret complex concepts into simple-to-follow thoughts, and for some to emerge as leaders that can more powerfully promote productivity within the group. Communication can be a tricky concept when several are involved, but it will also be among the most important tools to master. Then positive attitude, if everyone believed that a project was doomed to fail, and then it probably would, simply because people would not be putting a sincere effort into it, nor working toward any goal in their mind. In addition, the opinion that someone has concerning their teammates can affect success as well; having a negative opinion of neighboring workers may harbor a hostile working environment, begin planting seeds of strife and conflict, or even the unwillingness to both participating together. Last factor will be trust. Trust is one of the essential factors that promote effective teamwork, because so many of the valuable strategies and methods that help bring team members toward task completion are rendered impossible or altogether unavailable without it. Without trust, people do not share as much information with each other; without trust, some may want to shoulder more of the load than they can truly handle rather than appropriately delegate portions to others; without trust, nobody can take any risks, even when wisely calculated.


In overall group behavior and teamwork is very important for every company, especially for the company in Bayan Lepas FIZ. This is because the great changes in their company may lead to negative perceptions. When they work together in a group, they can increase the strengths and weaknesses of each team member. One of the benefits of strong teamwork in the workplace is that team leaders and members become proficient at dividing up tasks so they are done by the most qualified people. Without strong teamwork, it can be difficult for managers and executives to determine which staff members can best accomplish job tasks. Other than that, the good relationship between the employees and upper levels will help them to create a willingness to attend and work for the company for long time.

Then, teams in the workplace often meet to discuss how to solve company issues. When a team works well together, it allows staff members to feel more comfortable in offering suggestions. Team members become accustomed to processing brainstorming information and the company benefits from the variety of suggestions that come from effective teams. On the other hand, there are challenges each day in any workplace, and a strong team environment can act as a support mechanism for staff members. Work group members can help each other improve their performance and work together toward improving their professional development. Team members also come to rely on each other and trust each other. These bonds can be important when the team faces a particularly difficult challenge or if the group is forced to deal with the loss of a team member while still trying to maintain productivity.


Alvesson, Mats (Author). Understanding Organizational Culture.London, GBR: SAGE Publications Ltd. (UK), 2002,p9, assessed 20 Feb 2013,

Mahajan, J.P. (Author). Business Organization and Management. Mumbai, IND: Himalaya Publishing House, 2010. p 89, assessed 20 Feb 2013,

Ziaulasif, October 2010. Compare and Contrast Different Organizational Structures and Cultures, 27 January 2013,

Hoboken, NJ, USA, Wiley, 2010, p 3, assessed on 28 Feb 2013,

Verstappen, Stefan H. Chinese Business Etiquette: The Practical Pocket Guide, Berkeley CA, USA: Stone Bridge Press, 2008. p 18,

Karthick, K.K., Organizational Behavior, Mumbai, IND: Global Media, 2010. p 126,

Nair, Suja R., Organizational Behavior, Mumbai, IND: Global Media, 2010. p 335,

Chris Hall 2004, The nature of group and group behavior, assessed on 2 March 2013,

Biech, Elaine. Pfeiffer Book of Successful Team-Building Tools: Best of the Annuals (2nd Edition), Hoboken, NJ, USA: Pfeiffer, 2008. p 1,