XAT 2012 — Decision Making Question 25
Answer the following question on the basis of the information given in the following case.
Saral Co. is operating in seven north-eastern states of the country. The organization has a history of participative decision making, wherein people deliberate openly about pros and cons of every important decision, and a broad consensus is taken before taking the final decision. In Saral Co. every employee gets a salary proportional to the sales achieved. A new General Manager (GM) joined during the beginning of this month and challenged the organization’s sole focus on sales to determine salaries. He urged the top management to include two more additional parameters in determining the salaries of the employees, viz. collection of information about competitors and the quality of relationship with the retailers.
The top management of Saral Co. refused to implement the proposal of new GM from the beginning of next month, which of the following could be the most justified reason for the management’s refusal?
Answer & solution
- A
To ensure that no manager will get credit for a major change soon after joining.
- B
To avoid attracting criticism for their failure to implement a similar scheme.
- C
His past experience is limited to seven north-eastern states only.
- D
The GM is new to the organization and he would require some time to implement the new plan.
The top management would need time to deliberate and get consensus.
A and B are trivial points which the management wouldn’t give importance to. Option C is irrelevant data. Option D places too much responsibility on the GM, and is not representative of the ‘entire management’.
Option E is apt.
Hence, the correct answer is option 5.