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Unit 3: Behavioural Considerations

Some rules act as guides, which allow the organisation members to depart from either under Notes
specific circumstances or as per their own judgment that a departure would be in the best
interests of the organisation. Such departure may require the approval of higher authority.

Example: Increase the credit limit of a customer whose performance in the past was
satisfactory and under specific circumstances.
Some rules are positive requirements that certain actions should be taken (e.g. fire drills at
prescribed intervals). Others are prohibited against unethical, illegal or other undesirable actions.
Finally there are rules that never be broken under any circumstances.

Example: Rule, prohibiting payment of bribes or a rule that airlines pilots must never
take off without permission of air traffic controller.

Some specific types of rules are given below:
1. Physical control: Security guards, locked storerooms, vaults, computer passwords,
television surveillance and other physical controls may be part of the control process.
2. Manuals: Manuals in bureaucratic organizations are more detailed than are those in other
organizations. Large organizations have more manuals than small organizations;
centralized organizations have more than decentralized ones and organisation with
geographically dispersed units performing similar function (such as fast food restaurant
chains) have more than do single-site organizations.

With passage of time, some rules become outdated hence manuals and other sets of rules
should be re-examined periodically to see that are still consistent with the senior
managements wishes.
3. System safeguards: Various safeguards are built into the information processing system
to ensure that information flowing through the system is accurate and to prevent fraud of
any sort. These include cross checking totals with details, requiring signature and other
evidence that the transaction has been authorized, separating duties, counting cash and
other movable assets at frequent intervals and other procedures mentioned in auditing.
This also includes checks of the system performed by the external and internal auditors.
4. Task Control System: Many of the tasks are covered by rules. In case of automation, the
system itself provides the control.

Self Assessment

Multiple Choice Questions:
3. Which of the following consists of shared values, common perception and common
premises that members of the organization apply to its activities and problems?
(a) Decision making (b) Corporate culture
(c) Style (d) Infrastructure
4. Which control style is more participative and attempts to capitalize upon the motivation
of a subordinate?
(a) Mixed style (b) External control style
(c) Internal control style (d) None of the above

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