MGMT 4

The definition of self-efficacy and self-confidence

-Is an individual's strong belief that he or she can accomplish a specific task or outcome successfully Self-efficacy is one dimension of self-confidence -general assurance in one's own ideas, judgment, and capabilities.

Factors associated with larger span of control

- Characteristics for less supervisor involvement and thus, larger spans of control o Work performed by subordinates is stable and routine o Subordinates perform similar work tasks o Subordinates are concentrated in a single location o Subordinates are highly trained and need little direction in performing tasks o Rules and procedures defining task activities are available o Support systems and personnel are available for the manager o Little time is required in nonsupervisory activities, such as coordination with other departments or planning o Managers' personal preferences and styles favor a large span

Read the second paragraph on page 489

- Emotions can be understood as being determined by whether people are getting their needs and goals met - Managers can influence whether people experience primarily positive or negative emotions at work - The emotional state of the manager influences the entire team or department We can "catch" emotions from others - Emotional contagion: managers who express positive emotions such as happiness, enthusiasm, and appreciation trigger positive emotions in employees Research suggests that nearly all human beings are subject to emotional contagion and will automatically and unconsciously start feeling and displaying the same emotions as those around them - New research by organization behavior scientists suggests that negative emotions might spread more easily than positive ones. Negative people and events have a disproportionately large effect on our emotions and moods

Line department versus staff department (typical examples), line authority versus staff authority

- Line authority: people in management positions have the formal authority to direct and control immediate subordinates Line departments: perform tasks tat reflect the organization's primary goal and mission Example: in a software company, line departments make and sell the product - Staff authority: includes the right to advise, recommend, and counsel in the staff specialists' area of expertise. Narrower than line authority Communication relationship Staff Departments include all those that provide specialized skills in support of line departments Example: marketing, labor, relationships, research accounting, HR

The two principles associated with chain of command

- Unity of command: each employee is held accountable to only one supervisor - Scalar principle: a clearly defined line of authority in the organization that includes all employees Subordinates at every level should follow the chain of command

The consequence of too much responsibility or authority

- When managers have responsibility for task outcomes but little authority, the job is possible but difficult. They rely on persuasion and luck - When managers have authority exceeding responsibility, they may become tyrants, using authority to achieve frivolous outcomes

Common financial ratios (see Exhibit19.10 on page 682)

-Liquidity ratio: indicates an organization's ability to meet its current debt obligations o Current ratio: tells whether the company has sufficient assets to convert into cash to pay off its debts, if needed -Current Ratio = current assets divided by current liabilities o Quick ratio: cash plus accounts receivable divided by current liabilities -Activity ratio: measures internal performance with respect to key activities defined by management o Inventory turnover: tells how many times inventory is used up to meet the total sales figure -Inventory turnover: total sales divided by average inventory o Conversion ratio: indicator of a company's effectiveness in converting inquiries into sales -Conversion ratio = purchase orders divided by customer inquiries -Profitability ratios: states profits relative to a source of profits, such as sales or assets o Profit margin on sales = net income divided by sales o Gross margin = gross (before tax) profit divided by total sales o Return on Assets (ROA): a percentage representing what a company earned from its assets, computed as net income divided by total assets -Used to compare a company's ability to generate earnings with other investment opportunities -Leverage: funding activities with borrowed money o A company can use leverage to make its assets produce more than they could on their own o Debt ratio = total debt divided by total assets -Lenders may consider a company with a debt ratio above 1.0 to be a poor credit risk

What are the three OD activities?

-Team building: enhances the cohesiveness and success of organizational groups and teams -Survey-feedback: begins with a questionnaire distributed to employees on values, climate participation, leadership, and group cohesion within their organization. After the survey is completed, an OD consultant meets with groups of employees to provide feedback about their responses and the problems identified. Employees are engaged in problem solving based on the data -Large-group intervention: this approach brings together participants from all parts of the organization - often including key stakeholders from outside the organization as well - to discuss problems or opportunities and plan for change.

Five approaches for departmentalization, advantage and disadvantage

-Vertical Functional Approach -Divisional Structure (M-form, multidivisional) -Matrix Approach -Team-based Structure -Virtual Network Structure

organizational development

-a planned, systematic process of change that uses behavioral science knowledge and techniques to improve an organization's health and effectiveness through its ability to adapt to the environment, improve internal relationships, and increase learning and problem-solving capabilities - focuses on the human and social aspects of the organization and works to change attitudes and relationships among employees, helping to strengthen the organization's capacity for adaptation and renewal

cross functional team

-consists of employees from various functional departments who are responsible to meet as a team and resolve mutual problems. Participants from several departments meet regularly to solve ongoing problems of common interest o Team members still report to their functional departments, but they also report to the team, one member of whom may be the leader o Works with continuing problems rather than temporary problems

What is reverse innovation

-creating innovative, low-cost products for emerging markets and then quickly and inexpensively repacking them for sale in developing countries. Innovation starts in emerging markets and then transfers to affluent countries o Some observers think that companies in emerging markets such as China and India will produce a great percentage of innovations in the coming years o Example: Godrej & Boyce created a low-cost, battery-powered refrigerator for India, called the chotuKool o Example: Lenovo introduced LePhone in China as an inexpensive alternative to the iPhone o Example of other companies: Lenovo, General Electric (GE), John Deere, Nestle, Procter & Gamble (P&G), Xerox

Virtual Network Structure

-firm subcontracts most of its major functions to separate companies and coordinates their activities from a small organization at headquarters o The organization may be viewed as a central hub surrounded by a network of outside specialists, sometimes spread all over the world o Company can concentrate on what it does best and contract out other activities

What is ambidextrous approach?

-incorporating structures and processes that are appropriate for both the creative impulse and for the systematic implementation of innovations o Managers encourage flexibility and freedom to innovate and propose new ideas with creative departments but use a more rigid, centralized, and standardized approach for implementing innovations

What is disruptive innovation

-innovation in products or services that typically start small and end up completely replacing an existing product or service technology for producers and consumers o Companies that initiate a disruptive innovation typically win big, companies affected by disruptive technology may be put out of business. o Example: Massive, Open, Online Classes (MOOCs) could become a disruptive innovation to the traditional and expensive classroom-based form of delivering courses for a college education o Example: DVDs wiped out the videotape industry and now streaming video is now threatening DVDs o Example: Digital cameras are eliminating the photographic film industry o Example: smartphones are threatening compact digital cameras o Example: Square (credit card reader) is disrupting the financial services system for credit card payments

-Team-based Structure -Cross functional teams -Permanent teams

-the entire organization is made up of horizontal teams that coordinate their work and work directly with customers to accomplish the organization's goals -consists of employees from various functional departments who are responsible to meet as a team and resolve mutual problems Team members still report to their functional departments, but they also report to the team, one member of whom may be the leader -groups of employees who are organized in a way similar to a formal department Each teams brings together employees from all functional areas focused on a specific task or project

What is organizational structure (3 components)?

-the set of formal tasks assigned to individuals and departments; - the formal reporting relationships, including lines of authority, decision responsibility, number of hierarchical levels, and span of managers' control; Provides a framework for vertical control of the organization -The design of systems to ensure effective coordination of employees across departments

What is fundamental attribution error and self-serving bias

Attributions: judgments about what caused a person's behavior - something about the person or something about the situation o Internal attribution: characteristics of the person led to the behavior o External attribution: something about a situation caused the person's behavior Fundamental attribution error: When evaluating others, we tend to underestimate the influence of external factors and overestimate the influence of internal factors o Example: Consider the case of someone being prompted to CEO. Employees, outsiders, and the media generally focus on the characteristics of the person that allowed him or her to achieve the promotion. In reality, however, the selection of that person might have been heavily influenced by external factors, such as business conditions creating a need for someone with a strong financial or marketing background at that particular time Self-serving bias: when people tend to overestimate the contribution of internal factors to their successes and overestimate the contribution of external factors to their failures o People give themselves too much credit for what they do well and give external forces too much blame when they fail o Example: if your manager says that you don't communicate well enough, and you think that your manager doesn't listen well enough, the truth may actually lie somewhere in between

The characteristics of creative people (see exhibit 11.2 on page 370)

Creativity: the generation of novel ideas that might meet perceived needs or respond to opportunities for the organization Creative organizations are loosely structured. People find themselves in a situation of ambiguity, assignments are vague, territories overlap, tasks are loosely defined, and much work is gone by teams

Divisional structure advantages and disadvantages

Divisional Structure Advantages -Organization will be flexible and responsive to change because each unit is small and tuned in to its environment -By having employees working on a single product line, concern for customers' needs is high -Great coordination exists within divisions Divisional Structure Disadvantages -Coordination across divisions is often poor -Problems can occur when autonomous divisions go in opposite directions -Duplication of resources and high costs of running separate divisions -Organization loses efficiency and economies of scale -Small size of departments within each division may result in a lack of technical specialization, expertise, and training

Comparison between hierarchical versus decentralized approaches (see exhibit 19.3 on page 668) and pay attention to actions.

Hierarchical Control: involves monitoring and influencing employee behavior through extensive use of rules, policies, hierarchy of authority, written documentation, reward systems, and other formal mechanisms o Control relies on centralized authority, formal hierarchy, and close personal supervision o Responsibility for quality control rests with quality control inspectors and supervisors rather than employees o Individual employees are rewarded (wages, benefits, promotions) in exchange for meeting standards o Managers do not consider culture a useful means of controlling employees and the organization o Technology often is used to control the flow and pace of work or to monitor employees Decentralized control: based on values and assumptions that are almost opposite to those of hierarchical control. o Relies on cultural values, traditions, shared beliefs, and trust to foster compliance with organizational goals o Rules and procedures are used only when necessary o Emphasis on the selection and socialization of employees to ensure that workers have the appropriate values need to influence behavior toward meeting company goals o Self discipline and self-control are what keep workers performing their jobs up to standard o Empowers employees o Power is more dispersed and is based on knowledge and experience as much as position o Emphasis more on the outcomes to be achieved than on the specific tasks to be performed o People are rewarded for team and organizational success as well as their individual performance o Culture is adaptive

What is job satisfaction?

Job satisfaction: the degree to which a person finds fulfillment in his or her job o People experience job satisfaction when their work matches their needs and interests, when working conditions and rewards (pay) are satisfactory, when they like their coworkers, and when they have positive relationships with supervisors o Research shows that the link between satisfaction and performance is generally small and is influenced by other factors. -The importance of satisfaction varies according to the amount of control an employee has. -An employee doing routine tasks may produce the same output, no matter how he or she feels about the job -Only 45% of US employees say they are satisfied at work, the lowest satisfaction level in the survey's history

Matrix advantages and disadvantages

Matrix Advantages: -Highly effective in a complex, rapidly changing environment in which the organization needs to be flexible, innovative, and adaptable -Makes efficient use of human resources because specialists can be transferred from one division to another Matrix disadvantages: -Confusion and frustration caused by the dual chain of command. -Can generate a high level of conflict because it pits divisional and functional goals in a domestic structure Time lost to meetings and discussions

The three type of problems that OD can address

Mergers/acquisitions: The disappointing financial results of many mergers and acquisitions are caused by the failure of executives to determine whether the administrative style and corporate culture of the two companies fit. o Cultural differences should be evaluated during the acquisition process, and OD experts can be used to smooth the integration of two firms Organizational decline/revitalization: organizations undergoing a period of decline and revitalization experience a variety of problems, including a low level of trust, lack of innovation, high turnover, and high levels of conflict and stress. o OD techniques can contribute greatly to cultural revitalization by managing conflicts, fostering commitment, and facilitating communication Conflict management: conflict can occur at any time and place within a healthy organization. o OD efforts can help resolve conflicts, as well as conflicts that are related to growing diversity and the global nature of today's organizations

What techniques are included in TQM?

Quality circle: a group of 6 to 12 volunteer employees who meet regularly to discuss and solve problems that affect the quality of their work o Members of the quality circle meet, identify problems, and try to find solutions o The reason for using quality circles is to push decision making to an organization level at which recommendations can be made by the people who do the job and know it better than anyone else Benchmarking: the continuous process of measuring products, services, and practices against the toughest competitors or those companies recognized as industry leaders to identify areas for improvement Organizations may also use benchmarking for generating new business ideas, assessing market demand, or identifying best practices within an industry Five step benchmarking process: 1. Planning the benchmarking study 2. Identifying the source of the information to be collected 3. Collect the data 4. Analyze the benchmarking data that has been collected and recommending areas of improvement 5. Analyze the benchmarking data that has been collected and recommending areas of improvement Six Sigma: a highly ambitious quality standard that specifies a goal of no more than 3.4 defects per million parts o Being defect-free 99.9997% of the time o Generic term for a quality-control approach that takes nothing for granted and emphasizes a disciplined and relentless pursuit of higher quality and lower costs o Six Sigma is based on a five-step methodology referred to as DMAIC Define, Measure, Analyze, Improve, and Control Quality Partnering: involves assigning dedicated personnel within a particular functional area of the business o Quality control personnel work alongside others within a functional area identifying opportunities for quality improvements throughout the work process o Quality partners are viewed as "insiders" and peers who are readily accepted into the work group Continuous improvement (Kaizen): the implementation of a large number of small incremental improvements in all areas of the organization on an ongoing basis - in a successful TQM program, all employees learn that they are expected to contribute by initiating changes in their own job activities - Improving things a little bit at a time, all the time, has the highest probability of success

manufacturing technology

Structure Fits the Technology - Manufacturing firms could be categorized according to three basic types of production technology o Small-batch [and unit] production: firms that produce goods in batches of one or a few products designed to customer specification -Humans are a larger part of the process -Low centralization; organic o [Large-batch and] Mass production: technology is distinguished by standardized production runs. A large volume of products is produced and all customers receive the same products -Greater use of machines than small batch production and employees complement the machinery -High centralization; mechanistic o Continuous process production: the entire workflow is mechanized in a sophisticated complex form of production technology. The process runs continuously and has no starting or stopping -Machinery does all the work -Low centralization; organic

Factors shaping structure, company strategy

Structure follow strategy o Business performance is strongly influenced by how well the company's structure is aligned with its strategic intent and the needs of the environment o Differentiation Strategy: organization attempts to develop innovative products unique to the market o Cost Leadership Strategy: organization strives for internal efficiency o Goals of cost efficiency occur in more stable environments o Goals of innovation and flexibility occur in more uncertain environments o Mechanistic: goals of efficiency and a stable environment -Typically has a rigid vertical, centralized structure with most decisions made at the top o Organic: looser, free-flowing, and adaptive -more horizontal, and decision-making authority is decentralized

team advantages and disadvantages

Team advantages: -Breaks down barriers across departments and improves coordination and cooperation -Team members know one another's problems and compromise rather than blindly pursue their own goals -Allows the organization to adapt more quickly to customer requests and environmental changes and speeds decision making because decisions need not go to the top of the hierarchy for approval -Morale boost: employees are typically enthusiastic about their involvement in bigger projects rather than narrow departmental tasks Team Disadvantages -Employees may experience conflicts and dual loyalties -Large amount of time is devoted to meetings, thus increasing coordination time. This results in a loss of efficiency -The team approach may cause too much decentralization -Team members often do not see the big picture of the corporation and make decisions that are good for their group, but bad for the organization as a whole

The big five personality factors

The Big Five personality factors describe an individual's extroversion, agreeableness, conscientiousness, emotional stability, and openness to experience o 1. Extroversion: the degree to which a person is outgoing, sociable, assertive, and comfortable with interpersonal relationships o 2. Agreeableness: the degree to which a person is able to get along with others by being good-natured, likeable, cooperative, forgiving, understanding, and trusting Traits of agreeableness seem to be particularly important in today's collaborative organizations. o 3. Conscientiousness: the degree to which a person is focused on a few goals, thus behaving in ways that are responsible, dependable, persistent, and achievement-oriented Recent research suggests that traits of conscientiousness are more important than those of extroversion for effective leadership o 4. Emotional stability: the degree to which a person is calm, enthusiastic, and self-confident, rather than tense, depressed, moody, or insecure o 5. Openness to experience: the degree to which a person has a broad range of interests and is imaginative, creative, artistically sensitive, and willing to consider new ideas A person may have low, moderate, or high degree of each quality -Having a moderate-to-high degree of each of the Big Five personality factors is considered desirable for a wide range of employees, but isn't always a key to success

crowdsourcing

The internet has made it possible for companies to tap into ideas from around the world and let hundreds of thousands of people contribute to the innovation process o the most straightforward way to enlist the help of a crowd is with a contest

What are the five implementation tactics

Top Management Support o The visible support of top management makes people aware of the importance of change o Top management support is especially important when a change involves multiple departments or when resources are being reallocated among departments Communication and Education are used when solid information about the change is needed by users and others who may resist implementation. o Managers should also remember that implementing change requires speaking to people's hearts (feelings) as well as to their minds (facts) Participation involves users and potential resisters in designing the change. o This approach is time consuming but it pays off because users understand and become committed o Participation also helps managers determine potential problems and understand the differences in perceptions of change among employees Negotiation: uses formal bargaining to win acceptance and approval of a desired change Coercion: managers use their formal power to force employees to change. o Resisters are told to accept the change or lose rewards (or even their jobs) o This approach should not be used because employees feel like victims o Coercion may be necessary in crisis situations when a rapid response is urgent.

What is TQM philosophy

Total Quality Management (TQM): an organization-wide effort to infuse quality into every activity in a company through continuous improvement o Based on a decentralized control philosophy o TQM focuses on teamwork, increasing customer satisfaction and lowering costs o Organizations implement TQM by encouraging managers and employees to collaborate across functions and departments, as well as with customers and suppliers, to identify areas for improvement, no matter how small

Advantages and disadvantages of vertical functional structure advantages

Vertical Functional Structure Advantages: -Permits economies of scale and efficient resource use -Enhance development of in-depth skills because people work on a variety of related problems and are associated with other experts within their own department -Because chain of command converges at the top, the functional structure also offers a way to centralize decision making and provide unified direction from top managers Vertical Functional Structure Disadvantages -Barriers exist across departments -Communication and coordination across functions are often poor, causing a slow response to environmental changes -Decisions involving more than on department may pile up at the top of the organization and be delayed

Virtual Network Advantages and disadvantages

Virtual Network Advantages -Flexibility and competitiveness on a global scale Flexibility comes from the ability to hire whatever services needed and to change a few months later without constraints from owning plants, equipment, and facilities -Ability to draw on resources and expertise worldwide to achieve the best quality and price and can sell its products and services worldwide -May only have two or three levels of hierarchy Virtual Network Disadvantages -Lack of hands-on control -Each partner in the network necessarily acts in its own self-interest -Ambiguous boundaries create higher uncertainty and greater demands on managers for defining shared goals, managing relationships, keeping people focused and motivated, and coordinating activities so that everything functions as intended -Customer service and loyalty can also suffer if outsourcing partners fail to perform as expected -Employee loyalty can weaken-employees might feel that they can be replaced by contract services

balanced scorecard

a comprehensive management control system that balances traditional financial measures with operational measures relating to a company' critical success factors

project manager

a person who is responsible for coordinating the activities of several departments for the completion of a specific project - not a member of one of the departments being coordinated. They are located outside the departments and have responsibility for coordinating several departments to achieve desired project outcomes

idea champion

a person who sees the need for and champions productive change within the organization Research confirms that successful new ideas are generally those that are backed by someone who believes in the idea wholeheartedly and is determined to convince others of its value

Bottom-up budgeting

a process in which lower-level managers anticipate their department's resource needs and pass them up to top management for approval o Movement toward employee empowerment, participation, and learning means that many organizations are adopting bottom-up budgeting

skunkworks

a separate small, informal, highly autonomous, and often secretive group that focuses o breakthrough ideas for business -Variation of a new-venture team -The essence of skunkworks is that highly talented people are given the time and freedom to let creativity reign

new-venture team

a unit separate from the rest of the organization that is responsible for developing and initiating a major innovation -New-venture teams give free reign to members' creativity because their separate facilities and location unleash people from the restrictions imposed by organizational rules and procedures -Teams are typically small, loosely structured, and flexible

organizational chart

a visual representation of an organization structure Characteristics of vertical structure are portrayed

Vertical Functional Approach -Functional structure (U-form, unitary structure):

activities are grouped together by common function from the bottom to the top of the organization Groups positions into departments based on similar skills, expertise, work activities, and resource use

Geographic- or Customer-Based Divisions

an alternative for assigning divisional responsibility is to group company activities by geographic region or customer group

Zero-based budgeting:

an approach to planning and decision making that requires a complete justification for every line item in a budget instead of carrying forward a prior budget and applying a percentage change o A zero-based budget begins within a starting point of $0, and every dollar added to the budget is reflected by an actual, documented need

chain of command -unity of command -the scaler principles

an unbroken line of authority that links all employees in an organization and shows who reports to whom. -mens each employee is held accountable to only one supervisor -refers to a clearly defined line of authority in the organization that includes all employees

responsibility center

any organizational department or unit under the supervision of a single person who is responsible for its activity

internal contests

are an increasingly popular way to realize product and service innovations. Employees vote on their favorite submissions and the winner takes home a cash prize

What is self-awareness

being aware of the internal aspects of one's nature, such as personality traits, beliefs, emotions, and perceptions, and appreciating how your patterns affect other people o Experts agree that effective leaders know who they are and what they stand for

Authoritarianism

belief that power and status differences should exist within the organization o Individuals high in authoritarianism tend to be concerned with power and toughness, obey recognized authority above them, stick to conventional values, critically judge others, and oppose the use of subjective feelings o The trend toward empowerment and shifts in expectations among younger employees for more equitable relationships contribute to a decline in strict authoritarianism in many organizations

Top-down budgeting:

budgeted amounts for the coming year are literally imposed on middle- and lower-level managers. o These managers set departmental budget targets in accordance with overall company revenues and expenditures specified by top executives

What are the four steps of feedback control

can help managers meet strategic goals by monitoring and regulating the organization's activities and using feedback to determine whether performance meets established standards 1. Establish standards of performance o Managers define goals for organizational departments in specific, operational terms that include a standard of performance against which to compare organizational activities o To evaluate and reward employees effectively for the achievement of standards, managers need clear standards that reflect activities that contribute to the organization's overall strategy in a significant way o Standards should be defined clearly and precisely so that employees know what they need to do and can determine whether their activities are on target 2. Measure Actual Performance o Most organizations prepare formal reports of quantitative performance measurements that managers review daily, weekly, or monthly o Reports should be designed to help managers evaluate how well the organization is meeting its standards 3. Compare performance to standards: o Identify whether actual performance meets, exceeds, or falls short of standards Variance: the difference between each actual amount and the associated standard To correct the problems that most require attention, managers focus on variances o When performance deviates from a standard, managers must interpret the deviation. They are expected to dig beneath the surface and find the cause of the problem o Effective management control involves subjective judgment and employee discussions, as well as objective analysis of performance data 4. Take corrective action o Determine what changes, if any, are needed.

What is product change and technology change?

change in the organization's product or service outputs -Product and service innovation is the primary way in which organizations adapt to changes in markets, technology, and competition change in the organization's production process - how the organization does its work -Technology changes are designed to make the production of a product or service more efficient

people change

concerns just a few employees, such as sending a handful of middle managers to a training course to improve their leadership skills

work specialization

degree to which organizational tasks are subdivided into separate jobs o Employees within each department perform only the tasks relevant to their specialized function o When work specialization is extensive, employees specialize in a single task. Jobs tend to be small, but performed efficiently o Example: the separation of production tasks into bottling, quality control, and maintenance.

Cash budget

estimates receipts and expenditures of money on a daily or weekly basis to ensure than an organization has sufficient cash to meet its obligations o If the cash budget shows that the firm has more cash than necessary to meet short-term needs, the company can arrange to invest the excess to earn interest income o If the cash budget shows that the firm as less cash than necessary, the organization may borrow cash

open innovation

extending the search for and commercialization of new ideas beyond the boundaries of the organization and even beyond the boundaries of the industry, sharing knowledge and resources with other organizations and individuals outside the firm Example: turning the Angry Birds gaming app into books, movies, and toys

what areas are included in a balanced scorecard

four major perspectives o Financial performance: concern that the organization's activities contribute to improving short- and long-term financial performance -Includes net income and return on investment o Customer service: measures information such as how customers view the organization and customer retention and satisfaction -Can be collected through testimonials and surveys o Internal business processes: focus on production and operating statistics -Example: for an airline, business process indicators may include on-time arrivals and adherence to safety guidelines o Potential for learning and growth: focusing on how well resources and human capital are being managed for the company's future -Metrics may include employee retention and the introduction of new products

locus of control

how people perceive the cause of life events - whether they place the primary responsibility within themselves or on outside forces o High internal locus of control: some people believe that their own actions strongly influences what happens to them o High external locus of control: people believe that events in their lives occur because of chance, luck, or outside people and events o People with an internal locus of control are easier to motivate because they believe that rewards are the result of their behavior Better able to handle complex information and problem solving, are more achievement-oriented, but are also more independent and therefore more difficult to manage o People with an external locus of control are harder to motivate, less involved in their jobs, and more likely to blame others when faced with a poor performance evaluation, but they are also more compliant and conforming, and therefore easier to manage

Expense budget:

includes anticipated and actual expenses for each responsibility center and for the total organization o When actual expenses exceed budgeted amounts, the difference signals the need for managers to identify possible problems and take corrective action if needed o Expenses below budget may signal exceptional efficiency o r possibly the failure to meet some other standards

Revenue Budget

lists forecasted and actual revenues of the organization o Revenues below the budgeted amount signal a need to investigate the problem to see whether the organization can improve revenues o Revenues above budget would require determining whether the organization can obtain the necessary resources to meet the higher-than expected demand for its products or services

Capital budget:

lists planned investments in major assets such as buildings, heavy machinery, or complex information technology systems often involving expenditures over more than a year o Capital expenditures are investments designed to enhance profits o Capital budget is necessary to plan the impact of expenditures on cash flow and profitability

bottom-up approach

means encouraging the flow of ideas from lower levels and making sure that they get heard and acted upon by top executives

Accountability

means that the people are subject to reporting and justifying task outcomes to those above them in the chain of command o Mechanism through which authority and responsibility are brought into alignment o For organizations to function well, everyone needs to know what they are accountable for and accept the responsibility and authority for performing it

idea incubator

mechanism that provides a safe harbor where ideas from employees throughout the company can be developed without interference from company bureaucracy or politics

Span of management (span of control)

number of employees reporting to a supervisor Determines how closely a supervisor can monitor subordinates Generally, when supervisors must be closely involved with subordinates, the span should be small. And when supervisors need little involvement with subordinates, it can be large

what are the approaches to enhancing self-awareness

o Soliciting Feedback -Many people have blind spots-attributes about themselves that they are not aware of or don't recognize as problems - which limit their effectiveness and hinder their career success -Seeking feedback to enhance self-awareness can improve performance and job satisfaction for both managers and employees o Self-Assessment: uses self-inquiry and reflection to gain insights into oneself from the results of scores on self-assessment instruments -Self-assessment also means regularly reflecting on our thoughts and feelings Introspection: reflecting on our experiences, examining the effects of our actions and behavior, looking at the consequences for ourselves and others

Divisional Structure (M-form, multidivisional)

occurs when departments are grouped together based on similar organizational outputs. Also called a decentralized form o Diverse departments are brought together to produce a single organizational output, whether it is a product, a program, or service to a single customer o Departments are duplicated across product lines (example: accounting department)

What is halo effect

occurs when the perceiver develops an overall impression of a person or situation based on one characteristic, either favorable or unfavorable o A halo blinds the perceiver to other characteristics that should be used in generating a more complete assessment o The halo effect can play a significant role in performance appraisal o It is the manager's job to be sure that the assessment is based on complete information about job-related characteristics o Example: a person with an outstanding attendance record may be assessed as responsible, industrious, and highly productive; another person with less-than average attendance may be assessed as a poor performer

culture change

pertains to the organization as a whole, such as when the Internal Revenue Service (IRS) shifted its basic mind-set form an organization focused collection and compliance to one dedicated to informing, educating, and serving customers (taxpayers)

Top leader

responsible for the entire matrix. The top leader oversees both the product and functional chains of command. Their responsibility is to maintain a power balance between the two sides of the matrix

What is balance sheet

shows the firm's financial position with respect to assets and liabilities at a specific point in time. The balance sheet shows assets, liabilities, and owners equity o Assets: what the company owns -Includes current assets (those that can be converted into cash in a short time period) -Includes fixed assets (such as buildings and equipment that are long-term in nature) o Liabilities: the firm's debts -Includes current debt (obligations that will be paid by the company in the near future) -Includes long-term debt (obligations payable over a long period of time) o Owner's equity is the difference between assets and liabilities and is the company's net worth in stock and retained earnings

what is income statement

summarizes the firm's financial performance for a given time interval, usually one year o Sometimes called the profit and loss statement o The income statement shows revenues coming into the organization from all sources and subtracts all expenses, including cost of goods sold, interest, taxes, and depreciation o The bottom line indicates the net income - profit or loss - for the given period

Machiavellianism

the acquisition of power and the manipulation of other people for purely personal gain. o In loosely structured situations, high Machs actively take control, while low Machs accept the direction given by others o Low Machs thrive in highly structured situations, while high Machs perform in a detached, disinterested way. o High Machs are particularly good in jobs that require bargaining skills or that involve substantial rewards for winning.

The definition of organizational change

the adoption of a new idea or behavior by an organization o Sometimes change and innovation are spurred by forces outside the organization o Implementing change is typically one of the most difficult aspects of management

Departmentalization

the basis for grouping positions into departments and departments into the total organization

What is perception and what are the three steps in perception process?

the cognitive process that people use to make sense out of the environment by selecting, organizing, and interpreting information from the environment o Because of individual differences in personality, values, interests, and so forth, people often "See" the same thing in different ways Perception process: o 1. We observe information (sensory data) from the environment through our senses: taste, smell, hearing, sight, and touch o 2. Our mind screens the data and will select only the items that we will process further o 3. We organize the selected data into meaningful patterns for interpretation and response -Most differences in perception among people at work are related to how they select and organize sensory data

responsibility

the duty to perform the task or activity as assigned o The flipside of authority o Managers are assigned authority to commensurate with their responsibilities

authority

the formal and legitimate right of a manager to make decisions, issue orders, and allocate resources to achieve organizationally desired outcomes 1. Authority is vested in organizational positions, not people 2. Authority flows down the vertical hierarchy 3. Authority is accepted by subordinates

What is coordination and collaboration?

the managerial task of adjusting and synchronizing the diverse activities among different individuals and departments o Coordination is required regardless of whether the organization has a functional, divisional, or team structure the joint effort between people from two or more departments to produce outcomes that meet a common goal or shared purpose and that are typically greater than what any of the individuals or departments could achieve working alone

Delegation

the process that managers use to transfer authority and responsibility to positions below them in the hierarchy o Most organizations today encourage managers to delegate authority to the lowest possible level to provide maximum flexibility to meet customer needs and adapt to shifts in the environment o Delegating decision making to lower-level managers and employees can be highly motivating and improve speed, flexibility, and creativity o When managers can't delegate, they undermine the role of their subordinates and prevent people from doing their jobs effectively.

What is organizational control?

the systematic process of regulating organizational activities to make them consistent with the expectations established in plans, targets, and standards of performance o Effectively controlling an organization requires information about performance standards and actual performance, as well as actions taken to correct any deviations from the standards

What is stereotyping

the tendency to assign an individual to a group or broad category (e.g., female, black, elderly; or male, white, disabled) and then to attribute widely held generalizations about the group to the individual o Stereotyping prevents people from truly knowing those whom they classify in this way o Negative stereotypes prevent talented people from advancing in an organization and fully contributing their talents to the organization's success o Example: inaccurate stereotype that talkative female managers are incompetent o Example: Someone meets a new colleague, sees that he is in a wheelchair, assigns him to the category "physically disabled," and attributes to this colleague generalizations that she believes about people with disabilities, which may include a belief that he is less able than other coworkers

Two-boss employees

those who report to two supervisors simultaneously and must resolve conflicting demands from the matrix bosses

innovation by acquisition

to buy startup companies in order to obtain the innovative products and services, and often the talent behind them as well

Matrix Approach

combines aspects of both functional and divisional structures simultaneously, in the same part of the organization o The matrix structure evolved as a way to improve horizontal coordination and information sharing o The matrix approach has dual lines of authority (horizontal and vertical) Some employees actually report to two supervisors simultaneously

task force

Task force: a temporary team or committee designed to solve a problem involving several departments -Task force members represent their departments and share information that enables coordination

Perceptual distortions:

errors in perceptual judgment that arise from inaccuracies in any part of the perception process

Matrix boss

the product of functional boss, who is responsible for one side of the matrix