Chapter 1: Managing Effectively in a Global World POWERPOINT, Chapter 2: The Evolution of Management POWERPOINT, Chapter 3: The Organizational Environment and Culture POWERPOINT, Chapter 4: Ethics and Corporate Responsibility POWERPOINT, Chapter 5: P...

Scientific Management

"ONE BEST WAY"

What are the three broad categories of roles?

(1) interpersonal (2) informational (3) decisional

Middle-level managers _________________ individuals and _________________________ their activities.

- develop, support

Ethical Systems

- egoism - relativism - utilitarianism - virtue ethics

Psychological Biases

- illusion of control - framing effects - discounting the future

What are the FIVE sources of competitive advantage?

- innovation - quality - service - speed - cost competitiveness

Competitive Environment

- rivals - new entrants - buyers/customers - substitutes and complements - suppliers

Fayol's 14 PRINCIPLES of management

1) Division of Work 2) Authority 3) Discipline 4) Unity of Command 5) Unity of Direction 6) Subordination of individual interests to the general interest 7) Remuneration 8) Centralization 9) Scalar Chain 10) Order 11) Equity 12) Stability of tenure of personnel 13) Initiative 14) Esprit de corps

What are the THREE roles that managers perform?

1) Interpersonal 2) Informational 3) Decisional

What are the 5 levels of needs according to Maslow? (in ascending order)

1) physiological 2) safety 3) social 4) ego 5) self-actualization

Porter's Five Forces

1) threat of entry 2) threat of substitute 3) supplier bargaining power 4) buyer bargaining power 5) competitive rivalry

human relations

4th approach to management

transaction fee model

Charging fees for GOODS and SERVICES. (EBAY)

_____________________________ BOOSTS performance.

Collaboration

Spokesperson

Communicating on behalf of the organization about plans, policies, actions, and results.

Four structural approaches for managing uncertainty

Complex and stable: Decentralized, bureaucratic (standardized skills) Complex and dynamic: Decentralized, organic (mutual adjustment) Simple and Stable: Centralized, bureaucratic (standardized work procedures) Simple and Dynamic: Centralized, organic (direct supervision)

useful clues about culture:

Corporate mission statements and official goals Business practices can be observed Symbols, rites, and ceremonies give further clues about culture. The stories people tell carry a lot of information about the company's culture.

Organizing

Assembling and coordinating resources needed to achieve goals

Who introduced scientific management?

Frederick Taylor

authority

a chain of command or hierarchy is well established.

goal displacement

a condition that occurs when a decision-making group loses sight of its original goal and a new, less important goal emerges

final consumer

a customer who purchases products in their finished form

intermediate consumer

a customer who purchases raw materials or wholesale products before selling them to final customers

Divestiture

a firm selling one or more businesses

Diversification

a firm's investment in a different product, business, or geographic area

scenario

a narrative that describes a particular set of future conditions

Environmental Factor: Threat of Entry Unattractive

High threat; few entry barriers

Disturbance handler

Taking corrective action during crises or other conflicts.

The Business Costs of Ethical Failure

Level 1 Costs Level 2 Costs Level 3 Costs

Controlling

Monitoring performance and making needed changes.

Different Ethical Perspectives

Universalism Egoism Utilitarianism Relativism Virtue Ethics

Environmental scanning

Searching for and sorting through information about the environment.

___________________________ needs and should be LEVERAGED.

Diversity

people

Energy? SKILLS? Expertise?

Domain selection

Entrance to a new market or industry with an existing expertise

organizing function's goal

build a dynamic organization.

Max Weber advocated ________________________________.

bureaucracy

Opportunities may be created by ___________________________________.

calamities

PORTER

competitive strategy

business ethics

comprises the moral principles and standards that guide behavior in the world of business

Human dignity

concerns the value of each person as an end, not a means to the fulfillment of others' purposes

Human dignity

concerns the value of each person as an end, not a means to the fulfillment of others' purposes.

Interpersonal and communication skills

influence the manager's ability to work well with people. These skills are often called people skills or soft skills.

competitive intelligence

information that helps managers determine how to compete better

You gain competitive advantage by being better than your competitors at doing valuable things for your customers. managers must deliver the fundamental success drivers:

innovation, quality, service, speed, and cost competitiveness.

How detailed is a strategic plan?

low

Making ethical decisions takes:

moral awareness, moral judgement, moral character

Hawthorne Effect (Observation Bias)

people's reactions to being observed or studied resulting in SUPERFICIAL rather than meaningful changes in behavior

Effective managers in companies-_______________________________________________- to help employees reach their potential so organizations can succeed and thrive in the highly competitive and changing global marketplace.

plan, organize, lead, and control

In 500 BC, Sun Tzu discussed the importance of _________________________________________ in his book The Art of War.

planning and leading

5 functions of administrative management

planning, organizing, commanding, coordinating, and controlling.

Around 4000 BC, the Egyptians used ____________________________________________________________________________ to build their great pyramids; one pyramid took more than 100,000 laborers 20 years to complete.

planning, organizing, leading, and controlling

How long is an operational plan?

short (less than 1 year)

skills

specific abilities that result from knowledge, information, aptitude, and practice.

contingency plan

specifies actions when initial plans fail or events in the external environment create sudden change

Planning

specifying the goals to be achieved and deciding in advance the appropriate actions needed to achieve those goals.

demographics

statistical characteristics of a group or population such as age, gender, and education level.An organization's customers, a university's faculty and staff, or a nation's current labor force can all be described statistically in terms of their members' ages, genders, education levels, incomes, occupations, and so forth.

Planning supports the _____________________________.

strategy

division of labor

tasks, assignments, and authority are clearly specified.

Voluntary action

voluntary commitment to various interest groups, causes, and social problems (e.g., donating supplies to tornado victims). Companies like Thrivent Financial, Dow, Valspar, and Whirlpool are long-term supporters of Habitat for Humanity, a nonprofit organization that builds and rehabilitates houses for low-income families.70

acquistion

when one firm buys another

Trade-offs may occur among the five sources of competitive advantage, but this doesn't need to be a __________________________ game

zero-sum

Lillian Gilbreth

"mother of modern management," - She was interested in how job satisfaction motivated employees, how motion studies could be used to help disabled individuals perform jobs, and how fatigue and stress affected workers' well-being and productivity.

What are the key activities of frontline managers?

(1) Attracting and developing resources. (2) Creating and pursuing new growth opportunities for the business. (3) Managing continuous improvement within the unit.

What are the key activities of top-level managers?

(1) Establishing high performance standards. (2) Institutionalizing a set of norms to support cooperation and trust. (3) Creating an overarching corporate purpose and ambition.

What are the key activities of middle level managers?

(1) Linking dispersed knowledge and skills across units. (2) Managing the tension between short-term purpose and long-term ambition. (3) Developing individuals and supporting their activities.

What are the key activities of team leaders?

(1) Structuring teams and defining their purpose. (2) Finding resources and removing obstacles so teams can accomplish their goals. (3) Developing team members' skills so teams can be self-managing.

EQ combines three skill sets:

(1) Understanding yourself (2) Managing yourself (3) Working effectively with others

Ethics scholars point to various major ethical systems as guides.

(1) Universalism. (2) Egoism. (3) Utilitarianism. (4) Relativism. (5) Virtue ethics.

Planning activities include:

(1) analyzing current situations, (2) anticipating the future, (3)determining objectives, (4) deciding on what types of activities the company will engage, (5) choosing corporate and business strategies, and (6) determining the resources needed to achieve the organization's goals.

Several types of cooperative strategies are common:

(1) contracts (2) cooptation (3) coalition

The better you meet users' needs _______________________________________________________________________, the more value you deliver.

(in terms of quality, speed, efficiency, and so on

, Jim Collins authored an influential book titled Good to Great

Fayol identified ____________ functions and _____________________ principles of management.

- 5, 14

Systems theory

- A theory stating that an organization is a managed system that changes inputs into outputs - MATERIALS/ RESOURCE ---- TRANSFORMATION PROCESS ----- PRODUCT OR SERVICE

Failure Happens, But You CanImprove the Odds of Success

- Anticipate RISK - Consider the role of the ECONOMIC environment - Utilize business INCUBATORS - Realize there are common management challenges - Going public with an INITIAL PUBLIC OFFERING (IPO)

What THREE skills are managers required to have?

- Technical - Conceptual & Decision - Interpersonal & Communication (DICCT)

What was Follett's two key contributions?

- The notion that managers desire flexibility - The differences between motivating groups and individuals

DYNAMIC, SIMPLE structural approach for managing uncertainty.

- centralized - organic - direct supervision

Organizational culture

- clan - adhocracy - hierarchy - market

Ways That Managers Can Influence Their Environment

- competitive aggression - competitive pacification - public relations - voluntary action - legal action - political action

Frontline managers aim for ________________________________________________________ within the UNIT

- continuous improvement

Top-level managers institutionalize a set of NORMS to support ______________________ and __________________________.

- cooperation, trust

Top-level managers create an overarching _________________________ and _____________________________.

- corporate purpose, ambition

Internal Environment

- culture - values

STABLE, COMPLEX structural approach for managing uncertainty.

- decentralized - bureaucratic - standardized SKILLS

DYNAMIC, COMPLEX structural approach for managing uncertainty.

- decentralized - organic - mutual adjustment

What are Taylor's Four Functions of Scientific Management?

- develop a precise SCIENTIFIC APPROACH for EACH element of one's work - SCIENTIFICALLY select, train, teach, and develop each worker (sttd). - should cooperate with workers. - ensure an appropriate DIVISION of WORK and RESPONSIBILITY.

What are the FIVE characteristics of an EFFECTIVE bureaucracy?

- division of labor - authority - qualifications - ownership - rules

Corporate Social Responsibility (CSR)

- economic responsibility - legal responsibility - ethical responsibility - philanthropic responsibility - the notion that corporations are expected to go above and beyond following the law and making a profit

Successful management is defined by what two characteristics:

- efficiency - effectiveness

According to Barnard, a senior executive:

- formulates the purpose of the organization. - hires key individuals - maintains organizational communications

service

- giving customers what they want or need, when and where they want it. - focused on continually meeting the changing needs of customers to establish mutually beneficial long-term relationships.

Common Management Challenges

- growth - survival - may not like it - going public - mortality - poor controls - misuse of funds - delegation

Conceptual and Decision consist of the ability to _______________ and ____________________ problems for the benefit of the organization and its members.

- identify, solve

Elements included in an environmental analysis

- industry growth - industry forces - competitor analysis - legal trends - political activity - social issues - social interest groups - labor issues - Macroeconomic conditions - Technological factors

Resources

- inputs to a system that can enhance performance - TANGIBLE, INTANGIBLE assets

Describe the INNOVATION source of COMPETITIVE ADVANTAGE...

- introduction of new goods and services into the marketplace. - often, it may not refer to a new product but instead the way an existing product is delivered. - example: "raindrop water plop"

Middle-level managers link dispersed _________________________ and ___________________________ across units.

- knowledge, skills

Caux Principles include:

- kyosei - human dignity

environmental uncertainty

- lack of information needed to understand or predict the future - environmental complexity - environmental dynamism

Macroenvironment

- laws and regulations - economy - technology - demographics -social values

Interpersonal and Communication skills include the ability to ________________, _____________________, and __________________________________ effectively with others.

- lead, motivate, communicate (LMC)

Nonfinancial Resources

- legitimacy - networks - top-management teams - advisory boards - partners

Opportunities may be created by ___________________________ & ____________________________ changes.

- lifestyle, taste

HAMEL

- management innovation - ranked as the "world's most influential business thinker"

Top-level managers are responsible for the overall _________________________ and _____________________________ of the organization.

- management, effectiveness

Making the Choice

- maximize - satisfice - optimize

DRUCKER

- need for organizations to set clear objectives - MBO - decentralization - humans as assets and knowledge workers

Team leaders are _____________________ implementors and facilitators of team _____________________.

- operational, effectiveness

Frontline managers are ______________________________ implementors and aggressive ________________________.

- operational, entrepreneurs

Five Key Factors to consider in entrepreneurship

- people - opportunity - competition - context (environment) - risk and reward

What are the four functions of management?

- planning, - organizing, - leading, - controlling

Around 4000 BC, the Egyptians used __________________________________________________ to build their great pyramids.

- planning, organizing, leading, and controlling - the four functions of management.

Modern Contributors to management

- porter - hamel - drucker - senge - covey - collins

Kohlberg's Stages of Moral Development

- preconventional stage - conventional stage - principled stage

Benchmarking

- process of assessing how well one company's basic functions and skills COMPARE with those of another company or set of companies.

Laws and regulations _________________ and _________________ organizations.

- protect, restrain

Middle-level managers manage the tension between SHORT-TERM ____________________________ & LONG-TERM __________________________.

- purpose, ambition

Top-level managers are not only ____________________________ but also ____________________________________.

- resource allocators - institutional leaders

Team leaders find ____________________ and reduce _______________________ so that teams can accomplish their GOALS.

- resources - barriers

Five components of an organization's competitive environment

- rivals - new entrants - buyers/customers - substitutes and complements - suppliers

Team leaders aim to develop members' _________________ in order to be self-____________________.

- skills - sufficient

What are the contemporary approaches to management?

- sociotechnical systems - quantitative - organizational behavior - systems theory

Describe the SERVICE source of COMPETITIVE ADVANTAGE...

- speed and dependability at which an organization delivers a product

What are the three types of plans?

- strategic - tactical - operational

What are the classical approaches to management?

- systematic - scientific - bureaucracy - administrative - human relations

Team leaders structure ______________ and define their ____________________.

- teams - purpose

What are the FOUR different levels of managers?

- top-level manager - middle-level manager - frontline manager - team leader

Models for E-Commerce

- transaction fee model - subscription model - advertising support model - intermediary model - affiliate model

Emotional Intelligence includes _________________________ and ________________________________ yourself and dealing ______________________ with others.

- understanding, managing - effectively

A strong culture is one in which everyone ___________ and ________ in the firm's goals, priorities, and practices.

- understands, believes

In a weak culture, different people hold different ______, there is _________ about corporate _____, and it is not clear from one day to the next what principles should guide decisions.

- values - uncertainty - goals

Life Cycle Analysis (LCA)

A process of analyzing all inputs and outputs, through the entire "cradle-to-grave" life of a product, to determine total environmental impact

Situational Analysis

A process planners use, within time and resource constraints, to gather, interpret, and summarize all information relevant to the planning issue under consideration.

Skunkworks

A project TEAM designated to produce a new, innovative product.

tactical planning (1-2 years)

A set of procedures for translating broad strategic goals and plans into SPECIFIC GOALS and plans that are relevant to a distinct PORTION of the organization, such as a functional area like marketing.

Differentiation

A strategy an organization uses to build competitive advantage by being UNIQUE in its industry or market segment along one or more dimensions.

low-cost strategy

A strategy an organization uses to build competitive advantage by being efficient and offering a standard, no-frills product.

unrelated diversification strategy

A strategy used to add new businesses or products that produce unrelated products or are involved in unrelated markets and activities

Describe the ORGANIZING function of management...

ASSEMBLING and COORDINATING the RESOURCES needed to achieve goals

optimize

Achieving the best possible balance among several goals

In 1776, __________________________ discussed control and the principle of SPECIALIZATION with regard to manufacturing workers.

Adam Smith

Flexible Processes

Adapting the technical core to environmental changes.

To respond to their environment, managers and companies have a number of options, which can be grouped into three categories:

Adapting to the environment. Influencing the environment. Selecting a new environment.

Level 2 Costs

Administrative and audit Legal and investigative Remedial education Corrective actions Government oversight

Outcome of time and motion studies

After the "one best way" to perform the job was identified, Taylor stressed the importance of hiring and training the proper worker to do that job. Taylor advocated the standardization of tools, the use of instruction cards to help workers, and breaks to eliminate fatigue.

Needless to say, if you can offer a desirable product at a lower price, it is more likely to sell.

Mergers

One or more companies combine with another

Organizations must change continually because environments change continually.

Initial public offering (IPO)

Sale to the public, for the FIRST TIME, of federally registered and underwritten shares of stock in the company

Entrepreneur

Searching for new business opportunities and initiating new projects to create change.

Resource allocator

Providing funding and other resources to units or people; includes making major organizational decisions.

Generate alternatives

READY-MADE solutions Ideas that have been seen or tried before CUSTOM-MADE solutions New, creative solutions designed specifically for the problem

REVIEW EXHIBIT 1.4 ON SLIDE 11 IN CHAPTER 1 TO UNDERSTAND THE IMPORTANCE OF SKILLS AT DIFFERENT MANAGERIAL LEVELS.

Regulators are specific government organizations in a firm's more immediate task environment.

Review SLIDE 22 in Chapter 5

Rivals Can Be Domestic or Global

Advisory Boards

SHARING business smarts

GOALS should be __________________________.

SMART

Partners

SPREAD the load & responsibilities

Describe the LEADING function of management...

STIMULATING people to be HIGH PERFORMERS

Monitor

Seeking information to develop a thorough understanding of the organization and its environment.

Leader

Staffing, training, and motivating people to achieve organizational goals.

Chester Barnard published _______________________________________________.

The Functions of the Executive in 1938, which outlined the role of the senior executive

The Internet's impact on globalization is only one of the ways that technology is vitally important in the ever-changing business world. Technology both complicates things and creates new opportunities.

Vertical Integration Strategy

The acquisition or development of new businesses that produce parts or components of the organization's product

The best managers and companies deliver EVERY source of competitive advantage.

Environmental Dynamism

The degree of DISCONTINUOUS change that occurs within an industry

The education and skill levels of the workforce are another demographic factor managers must consider. The share of the U.S. labor force with at least some college education has been increasing steadily over the past several decades, from less than one-fourth of the workforce in 1970 to close to 70 percent today.19 Even so, many companies invest heavily in training Page 48their entry-level workers and send them through their own corporate universities, common at hundreds of large organizations like Apple, Boeing, Walt Disney, Amazon, McDonald's, and General Electric. Also, as college has become a more popular option, employers are having difficulty recruiting employees for jobs that require knowledge of a skilled trade, such as machinists and toolmakers.

Macroenvironment

The general environment; includes governments, economic conditions, and other fundamental factors that generally affect all organizations.

The government can affect business opportunities through tax laws, economic policies, labor laws, and international trade rulings.

competitive environment

The immediate environment surrounding a firm; includes suppliers, customers, rivals, and the like.

This means that it is likely that your coworkers, customers, suppliers, and other stakeholders will differ from you in race, ethnicity, age, gender, physical characteristics, or sexual orientation. To be an effective manager, you'll need to understand, relate to, and work productively with these individuals.

The labor force is becoming more and more diverse.

Corporate Strategy

The set of businesses, markets, or industries in which an organization competes and the distribution of resources among those entities.

These agencies have the power to investigate company practices and take legal action to ensure compliance with laws.

scientific management

This approach advocated the application of scientific methods to analyze work and to determine how to complete production tasks efficiently.

Top level managers include

CEO COO CIO

Steps of systematic management

Careful definition of duties and responsibilities. Standardized techniques for performing these duties. Specific means of gathering, handling, transmitting, and analyzing information. Cost accounting, wage, and production control systems to facilitate internal coordination and communications.

subscription model

Charging fees for SITE VISITS. (NETFLIX)

advertising support model

Charging fees to ADVERTISE on a site. (FACEBOOK)

affiliate model

Charging fees to SITE site visitors to other companies' sites. (AMAZON)

intermediary model

Charging fees to bring BUYERS and SELLERS together. (ANGIES LIST)

satisfice

Choosing an option that is acceptable, although not necessarily the best or perfect

Four Different Types of Organizational Cultures

Clan culture. Hierarchical culture. Market culture. Adhocracy review all functions on page 65

Evaluate the Alternatives

Complete and CURRENT? Satisfy OBJECTIVES? What are the potential PROBLEMS?

planning

Conscious, systematic process of making decisions about goals and activities that an individual, group, work unit, or organization will pursue in the future

Classical Approaches Before 1890: Systematic management 1900 to 1910: Scientific management 1910s: Bureaucracy 1920s: Administrative management 1930s: Human relations

Contemporary Approaches 1940s: Sociotechnical systems 1950s: Quantitative management 1960s: Organizational behavior 1960s to 1970s: Systems theory 1980 through the present: Modern contributions to current and future revolutions

prospectors

Continuously change the boundaries of their task environment by seeking NEW PRODUCTS AND MARKETS, diversifying and merging, or acquiring new enterprises

mutual adjustment

Coordination of work is made possible by a process of informal communication between people conducting interdependent work.

Effective managers can take several approaches to managing culture:

Craft an inspirational vision of "what can be" for the organizational culture. "Walk the talk" and show members of the culture that you are serious about and committed to long-term change. Celebrate and reward members who behave in ways that exemplify the desired culture.

Buffering

Creating supplies of excess resources in case of unpredictable needs.

Cultures can be strong or weak; strong cultures can greatly influence the way people think and behave.

Level 3 Costs

Customer defections Loss of reputation Employee cynicism Lost employee morale Employee turnover Government cynicism Government regulation

opportunity

Customer? COMPETITION? Resources/costs?

Customers, too, can be collaborators. Creating outstanding products and services can start with involving customers in company decisions

Implement the Decision

Determine how things will look when the decision is fully operational. Chronologically order, perhaps with a flow diagram, the steps necessary to achieve a fully operational decision. List the RESOURCES and ACTIVITIES required to implement each step. Estimate the TIME needed for each step. Assign RESPONSIBILITY for each step to specific individuals.

Don't assume that you can settle for delivering just one source of competitive advantage

Sustainable growth

Economic growth and development that meets present needs without harming the needs of future generations.

Origins of management

Egyptians, Chinese, Sun Tzu, Ancient Greeks, Venetians

Describe the SPEED source of COMPETITIVE ADVANTAGE...

Fast and timely EXECUTION, RESPONSE, and DELIVERY of results.

Environmental Factor: Substitutes Attractive

Few

Environmental Factor: Customers Unattractive

Few; high bargaining power.

Environmental Factor: Suppliers Unattractive

Few; high bargaining power.

Environmental Factor: Competitors Attractive

Few; high industry growth; unequal size differentiated.

social capital

Finding the time to build and maintain meaningful connections to a large and diverse network of contacts, clients, and other key stakeholders is a major challenge for managers today. While it can be time-consuming, connecting with people has never been easier. The goodwill stemming from your social relationships is more important than ever and aids your career success, compensation, employment, team effectiveness, successful entrepreneurship, and relationships with suppliers and other outsiders.67 Students should take time to build a large and diverse network while in school. This network may prove valuable in the future.

External influences include

GOVERNMENT, laws, regulations, policies Social, DEMOGRAPHIC, cultural ECONOMIC conditions TECHNOLOGY COMPETITION

If many factors prevent new companies from entering an industry, the threat to established firms is less serious. If there are few such barriers to entry, the threat of new entrants is greater.

In these cases, the top management team is likely to give lower-level managers authority to make decisions that benefit the firm. The term empowerment is used frequently today to talk about this type of decentralized authority.

Capital requirements

Getting started in some industries, such as building aircraft or operating a railroad, may cost so much that companies won't even try to raise such large amounts of money. This helps explain why Boeing and Airbus have no direct competitors in manufacturing large, long-haul aircraft.41

five key elements that make the current business landscape

Globalization. Technological change. The importance of knowledge and ideas. Collaboration across organizational boundaries. Increasingly diverse labor force.

ecocentric management

Goal is the creation of sustainable economic development and improvement of quality of life worldwide for all organizational stakeholders.

Several major barriers to entry are common:

Government policy Capital requirements Brand identification Cost disadvantages Distribution channels

Stakeholders

Groups and individuals who affect and are affected by the achievement of the organization's mission, goals, and strategies.

Who created the idea of administrative management?

Henri Fayol

How detailed is an operational plan?

High

Entrepreneur

Individuals who establish a new organization WITHOUT THE BENEFIT of corporate sponsorship.

Competitive intelligence

Information that helps managers determine how to compete better.

Sources of competitive advantage

Innovation, Quality, Service, Speed, Cost Competitiveness

Three broad skills that managers need

Interpersonal, informational, decisional

standing plan

Is designed to accomplish an enduring set of goals

Identify the problem

Is there a difference between ACTUAL and PLANNED performance? How can you DESCRIBE the deviation? What is/are the CAUSE(s) of the deviation? What specific GOALS should be met?

Why is the Internet so important to business?

It enables managers to be mobile and connected 24/7. It fulfills many business functions. It is a virtual marketplace, a means to sell goods and services, a distribution channel, an information service, and more. It speeds up globalization. Managers can see what competitors, suppliers, and customers are doing on the other side of the world. It provides access to information, allows better-informed decisions, and improves efficiency of decision making. It facilitates design of new products and services, from smartphones to online banking services.

Describe the COST COMPETITIVENESS source of COMPETITIVE ADVANTAGE...

Keeping costs low to achieve profits and be able to offer prices that are attractive to consumers.

____________________________ management is CRITICAL.

Knowledge

context (environment)

Laws & regulations? Taxes? Capital?

Smoothing

Leveling normal fluctuations at the boundaries of the environment.

How long is a strategic plan?

Long (3 to 7 years)

Environmental Factor: Threat of Entry Attractive

Low threat; many barriers.

Frontline managers are referred to as __________________________________________.

Lower-level managers

Describe the CONTROLLING function of management...

MONITORING and REACTING to PERFORMANCE

Liaison

Maintaining a network of outside contacts and alliances that provide information and favors.

strategic goals

Major targets or end results relating to the organization's long-term SURVIVAL, value, and GROWTH.

Taylor identified four principles of scientific management:

Management should develop a precise, scientific approach for each element of one's work to replace general guidelines. Management should scientifically select, train, teach, and develop each worker so that the right person has the right job. Management should cooperate with workers to ensure that jobs match plans and principles. Management should ensure an appropriate division of work and responsibility between managers and workers.

Managers can use several strategic maneuvers, including domain selection, diversification, merger and acquisition, and divestiture.

Managers must consider workforce demographics in formulating their human resources strategies. The labor force participation rate measures the percentage of the population working or looking for work.

Monitor and Control Performance

Managers must continually MONITOR the ACTUAL performance of their work units against the unit's goals and plans. Manager's also need to develop CONTROL SYSTEMS to measure that performance and allow them to take corrective action when the plans are implemented improperly or when the situation changes

Three general considerations help guide management's response to the environment:

Managers need to change what can be changed. Managers should use the appropriate response. Managers should choose responses that offer the most benefit at the lowest cost.

Managers often take more credit than they deserve.

ownership

Managers, NOT OWNERS, should run the organization

ownership

Managers, not owners, should run the organization

Environmental Factor: Substitutes Unattractive

Many

Environmental Factor: Customers Attractive

Many; low bargaining power.

Environmental Factor: Suppliers Attractive

Many; low bargaining power.

Environmental Factor: Competitors Unattractive

Many; low industry growth; equal size; commodity.

Mary Parker Follett emphasized the continually CHANGING situations that managers face.

According to McGregor, Theory X managers assume workers are lazy and irresponsible and require constant supervision and external motivation to achieve organizational goals. Theory Y managers assume employees want to work and can direct and control themselves.

McGregor advocated a Theory Y perspective, suggesting that managers who encourage participation and allow opportunities for individual challenge and initiative would achieve superior performance.

Mergers and acquisitions can offer greater efficiency from combined operations or can give companies relatively quick access to new markets or industries.

Who develops a tactical plan?

Middle managers

Managers located in the middle layers of the organizational hierarchy that report to top-level executives are referred to as __________________________________________.

Middle-level managers

Most of us think we are good decision makers, ethical, and unbiased, but most people have unconscious biases that favor themselves and their own group.

Frank Gilbreth developed a system to lower costs and increase worker productivity by showing how employees could work smarter, not Page 31harder

His analysis showed how the number of motions for the average bricklayer could be reduced from 18 to 4, allowing worker productivity to increase from 1,000 to 2,700 bricks laid each day.

Entrepreneur

a person with high creativity and innovation AND high general management skills, business know how, and networks.

Inventor

a person with high creativity and innovation AND low general management skills, business know how, and networks.

Manager Adminstrator

a person with low creativity and innovation AND high general management skills, business know how, and networks.

Promoter

a person with low creativity and innovation AND low general management skills, business know how, and networks.

groupthink

a phenomenon that occurs in decision making when group members avoid disagreement as they strive for consensus

Strategic Management

a process that involves MANAGERS from ALL parts of the organization in the formulation and the implementation of strategies and strategic goals

strategic planning (3-7 years)

a set of procedures for making decisions about the organization's long-term goals and strategies.

Concentration Strategy

a strategy employed for an organization that operates a single business and competes in a single industry

related diversification strategy

a strategy used to add new businesses or products that produce related products or are involved in related markets and activities

systems theory

a theory stating that an organization is a managed system that changes inputs into outputs

technical skill

ability to perform a specialized task that involves a certain method or process.

Cooptation

absorbing new elements into the organization's leadership structure to avert threats to its stability or existence. Many universities invite wealthy alumni to join their boards of directors.

Managing your costs and keeping them down require being efficient:

accomplishing your goals by using your resources wisely and minimizing waste.

To be efficient is to

achieve goals with minimal waste of resources—that is, to make the best possible use of money, time, materials, and people.

To be effective is to

achieve organizational goals.

Philanthropic responsibilities

additional behaviors and activities that society finds desirable and that the values of the business support

Henri Fayol advocated for _____________________________ management.

administrative

middle manager

administrative controller who bridges the gap between higher and lower levels. Today, middle-level managers break corporate objectives down into business unit targets; put together separate business unit plans from the units below them for higher-level corporate review; and serve as nerve centers of internal communication, interpreting and broadcasting top management's priorities downward and channeling and translating information from the front lines upward.

Barnard and Follett

administrative management

External Environment Opportunities and Threats affect _______________ of the industry.

all

external environment

all relevant forces outside a firm's boundaries, such as competitors, customers, the government, and the economy

sociotechnical systems theory

an approach to job design that attempts to redesign tasks to optimize operation of a new technology while preserving employees' interpersonal relationships and other human aspects of the work

contingency perspective

an approach to the study of management proposing that the managerial strategies, structures, and processes that result in high performance depend on the characteristics, or important contingencies, or the situation in which they are applied

Transcendent education

an education with five higher goals that balance self-interest with responsibility to others

egoism

an ethical principle holding that individual self-interest is the actual motive of all conscious action

utilitarianism

an ethical system stating that the greatest good for the greatest number should be the overriding concern of decision makers

Franchisor

an innovator who has created at least one successful store and seeks PARTNERS to operate the same concept in other markets.

strategic maneuvering

an organization's conscious efforts to change the boundaries of its task environment

BCG Matrix

analyzes business opportunities according to market growth rate and relative competitive position.

Scientific Management (Classical)

applied scientific methods to analyze and determine the "one best way" to complete production tasks.

systematic management

approach attempted to build specific procedures and processes into operations to ensure coordination of effort. Systematic management emphasized economical operations, adequate staffing, maintenance of inventories to meet consumer demand, and organizational control.

Bureaucracy (Classical Approach)

approach emphasizing a structure, formal network of relationships among specialized positions in the organization.

administrative management

approach that attempted to identify MAJOR PRINCIPLES and FUNCTIONS that managers could use to achieve superior organizational performance.

Quantitative management

approach that emphasizes the application of quantitative analysis to managerial decisions and problems.

Intrapreneurs

are new-venture creators working INSIDE BIG companies.

Organizing

assembling and coordinating the human, financial, physical, informational, and other resources needed to achieve goals. Organizing activities include attracting people to the organization, specifying job responsibilities, grouping jobs into work units, marshaling and allocating resources, and creating conditions so that people and things work together to achieve maximum success.

Around 1436, the Venetians standardized production through the use of an ____________________________, building warehouses and using an inventory system to monitor the contents.

assembly line

Around AD 1436, the Venetians STANDARDIZED production through the use of an _______________________________.

assembly line.

Human Relations (classical)

attempted to understand and explain how human PSYCHOLOGICAL and SOCIAL processes interact with the formal aspects of the work situation to influence performance.

Managers often _____________________________________ when they deserve some blame themselves.

blame others

This historical perspective is divided into two major sections:

classical approaches and contemporary approaches.

defenders

companies that STAY within a STABLE PRODUCT domain as a strategic maneuver

prospectors

companies that continuously change the boundaries for their task environments by seeking new products and markets, diversifying and merging, or acquiring new enterprises

Defenders

companies that stay within a stable product domain as a strategic maneuver

Integrity-based ethics programs

company mechanisms designed to instill in people a personal responsibility for ethical behavior

Compliance-based ethics programs

company mechanisms typically designed by corporate counsel to prevent, detect, and punish legal violations

globalization

company's talent can come from anywhere...more possible and more prevalent because of the Internet

Recent attention has also been centered on the possible ___________ ________ of socially responsible actions.

competitive advantage

Ways that managers can influence their environment

competitive aggression, competitive pacification, public relations, voluntary action, legal action, political action

Successful organizations, large and small, pay close attention to the controlling function. But today and for the future, the key managerial challenges are far more dynamic than in the past; they involve

continually learning and changing.

Technology is _______________________________ advancing.

continuously

In 1776, Adam Smith discussed _____________________________________________________ with regard to manufacturing workers.

control and the principle of specialization

For several thousand years, managers have wrestled with some of the same issues and problems that confront executives today. As far back as 5000 BC, the Sumerians practiced the management function of (discussed in Chapter 1) by keeping records of tax receipts, real estate holdings, and lists of farm animals.

controlling

buffering

creating supplies of excess resources in case of unpredictable needs

Peter Drucker

creator and inventor of modern management

Managing yourself

dealing with emotions, making good decisions, seeking feedback, and exercising self-control.

relativism

defines ethical behavior based on the opinions and behaviors of relevant other people.

Authority

delegate authority along with responsibility

Authority

delegate authority along with responsibility.

As early as 1100 BC, the Chinese applied the managerial concepts of _________________________________________________________________________.

delegation, cooperation, efficiency, organization, and control.

planning function

delivering strategic value.

Opportunities may be created by ___________________________ changes.

demographic

centralization

determine the relative importance of superior and subordinate roles

Centralization

determine the relative importance of superior and subordinate roles.

Division of Work

divide work into specialized tasks and assign responsibilities to specific individuals

Division of work

divide work into specialized tasks and assign responsibilities to specific individuals.

Unity of command

each employee should be assigned to only one supervisor.

Opportunities may be created by ___________________________________.

economic dislocations

Political action

efforts to influence elected representatives to create a more favorable business environment or limit competition (e.g., issue advertising or lobbying at state and national levels). In 2015, special interest groups like companies, labor unions, and other organizations spent a total of about $2.6 billion to lobby elected official and candidates in the United States

bureaucratic structures

eliminate the variability that results when managers in the same organization have different skills, experiences, and goals.

Good, successful managers often demonstrate a set of interpersonal skills known collectively as

emotional intelligence

Successful managers often demonstrate a set of interpersonal skills known as _________ ____________.

emotional intelligence

administrative management

emphasized the perspective of senior managers within the organization, and argued that management was a profession and could be taught.

quantitative management

emphasizes the application of quantitative analysis to management decisions and problems.

unity of direction

employees' efforts should be focused on achieving organizational objectives

Unity of direction

employees' efforts should be focused on achieving organizational objectives.

Initiative

encourage employees to act on their own IN SUPPORT of the organization's direction

Initiative

encourage employees to act on their own in support of the organization's direction.

team leader

engages in a variety of behaviors to achieve team effectiveness.34 The use of teams (discussed in Chapter 12) has increased as organizations shift from hierarchical to flatter structures that require lower-level employees to make more decisions.

Legal action

engaging the company in a private legal battle (e.g., lawsuits against illegal music copying). Viacom sued Google for allowing users to post copyrighted video clips on the Google-owned YouTube website.

domain selection

entering a new market or industry with existing expertise - For instance, the market may have limited competition or regulation, ample suppliers and customers, or high growth. An example is Nintendo's decision to create products such as the Wii that appeal to customer segments that have not been enthusiastic to purchase video games, such as people intimidated by complicated game controllers and parents concerned about the violent content and sedentary play involved in video games. By avoiding head-on competition to be the product with the best graphics or most advanced play, Nintendo was able to enjoy immediate profits from its new console. Thus Nintendo has used an existing expertise to broaden the goods and services it offers.

Decisional roles:

entrepreneur, disturbance handler, resource allocator, negotiator

Public relations

establishing and maintaining favorable images in the minds of those making up the environment (e.g., sponsoring sporting events). The oil and natural gas industry advertises its role in national independence.

middle-level managers

located in the organization's hierarchy below top-level management and above the frontline managers and team leaders. Sometimes called tactical managers, they are responsible for translating the general goals and plans developed by strategic managers into more specific objectives and activities.

Frontline Managers

lower-level managers who execute the operations of the organization. These managers often have titles such as supervisor or sales manager.

preconventional stage

make decisions based on immediate self interest

principled stage

make decisions based on self-chosen ethical principles

conventional stage

make decisions that conform to expectations of groups and institutions like family, peers, and society

Discipline

make expectations clear and punish violations.

Discipline

make expectations clear and punish violators

Systematic Management (Classical)

management that built in specific procedures and processes that would ensure coordination of effort to achieve established goals and plans.

As early as 1100 BC, the Chinese applied the ___________________________________ of delegation, cooperation, efficiency, organization, and control.

managerial concepts

Contigency perspective

managerial strategies, structures, and processes that result in high performance depend on the characteristics, or important contingencies, or the situation in which they are applied.

How detailed is a tactical plan?

medium

How long is a tactical plan?

medium (1 to 2 years)

Ethical responsibilities

meeting other social expectations, not written as law

Forecasting

method for predicting HOW VARIABLES WILL CHANGE THE FUTURE.

forecasting

method for predicting how variables will change the future

piecerate system.

method of remunerating the workers according to the number of unit produced or job completed. It is also known as payment by result or output. - aligns effort with reward.

flexible processes

methods for adapting the technical core to changes in the environment

tactical managers

middle-level managers

managers must be good at

mobilizing and inspiring people to engage fully in their work and contribute their ideas—to use their knowledge and experience in ways never needed or dreamed of in the past.

Informational roles:

monitor, disseminator, spokesperson

controlling

monitoring performance and making necessary changes in a timely manner. By controlling, managers make sure the organization's resources are being used as planned and the organization is meeting its goals for quality and safety.

Gantt suggested that frontline managers should receive a BONUS for each of their workers who completed their assigned daily tasks.

more output...higher wage/bonus

Contracts

negotiating an agreement between the organization and another group to exchange goods, services, information, patents, and so on. Suppliers and customers, or managers and labor unions, may sign formal agreements about the terms and conditions of their future relationships. These contracts are explicit attempts to make their future relationship predictable.

While, as a formal area of study, the field of management is relatively ______________, evidence of formalized management practices have been found dating back to _______________________.

new, 5000 BC.

Hawthorne effect .

people's reactions to being observed or studied resulting in superficial rather than meaningful changes in behavior

Ethics is a __________________ issue.

personal

Weber advocated that the jobs themselves be standardized so that _________________________ changes would not disrupt the organization.

personnel

Gantt expanded the _____________________ system.

piecerate

Another key element of Taylor's approach was the use of the differential

piecerate system.

fundamental management principles

planning, organizing, leading, and controlling.

Moral Philosophy

principles, rules, and values people use in deciding what is right or wrong

moral philosophy

principles, rules, and values people use in deciding what is right or wrong

Management

process of working with people and resources to accomplish organizational goals. Good managers do those things both effectively and efficiently.

team leaders are more like

project facilitators or coaches.

Esprit de Corps

promote a UNITY OF INTEREST between employees and management

Esprit de corps

promote a unity of interests between employees and management.

Stability and tenure of personnel

promote employee loyalty and longevity

Stability and tenure of personnel

promote employee loyalty and longevity.

Competing Values Framework (CVF) REVIEW SLIDE 24 in chapter 3

provides a practical way for managers to understand, measure, and change organizational culture

speed

rapid execution, response, and delivery of results—often separates the winners from the losers.

moral awareness

realizing the issue has ethical implications

economies of scale

reductions in the average cost of a unit of production as the total volume produced increases

review 1.4

Around 400-350 BC, the Greeks recognized management as a SEPARATE art and advocated a ___________________________________________ to work.

scientific approach

Around 400-350 BC, the Greeks recognized management as a separate art and advocated a ______________________________________________ to work.

scientific approach

Gilbreths

scientific management

Environmental scanning

searching for and sorting through information about the environment

Top-level managers consist of ____________________________________.

senior executives

Organization culture

set of assumptions about the organization and its goals and practices that members of the company share.83 It is a system of shared values about what is important and beliefs about how the world works. It provides a framework that organizes and directs people's behavior on the job.

knowledge management

set of practices aimed at discovering and harnessing an organization's intellectual resources—fully utilizing the intellects of the organization's people. is about finding, unlocking, sharing, and capitalizing on the most precious resources of an organization: people's expertise, skills, wisdom, and relationships.

In addition, we consider the idea that organizations have a responsibility to meet ___________________________ beyond earning profits within legal and ethical constraints.

social obligations

contemporary approaches

sociotechnical systems theory, quantitative management, organizational behavior, and systems theory.

A Technical skill is the ability to perform a ___________________________________________ involving a particular method or process.

specialized task

Leading

stimulating people to be high performers. It includes motivating and communicating with employees, individually and in groups. Leaders maintain close day-to-day contact with people, guiding and inspiring them toward achieving team and organizational goals. Leading takes place in teams, departments, and divisions, as well as at the tops of large organizations.

independent strategies

strategies that an organization acting on its own uses to change some aspect of its current environment

cooperative strategies

strategies used by two or more organizations working together to manage the external environment

organizational behavior

studies and identifies management activities that promote employee effectiveness through an understanding of the complex nature of individual, group, and organizational processes.

study exhibit 2.5

study exhibit 2.5 in 3.4 in chapter 2

Strategic managers, focus on the

survival, growth, and overall effectiveness of the organization.

Renumeration

systematically reward efforts that support an organization's direction

Remuneration

systematically reward efforts that support the organization's direction.

Goals

targets or ends that a manager wants to reach.

A __________________________________ is an employee who facilitates the successful performance of a team. (LOWEST level manager).

team leader

A relatively new type of manager, known as a

team leader

Opportunities may be created by ___________________________ discoveries.

technological

shareholder model

theory of corporate social responsibility that holds that managers are agents of shareholders whose primary objective is to maximize profits

stakeholder model

theory of corporate social responsibility that suggests that managers are obliged to look beyond profitability to help their organizations succeed by interacting with groups that have a stake in the organization

Porter's Five Forces

threat of entry, threat of substitute, supplier power, buyer power, and competitive rivalry

Taylor used techniques such as _______________________________________.

time-and-motion studies.

Legal responsibilities

to obey local, state, federal, and relevant international laws

Economic responsibilities

to produce goods and services that society wants at a price that perpetuates the business and satisfies its obligations to investors

Strategic Mangers

top-level managers

Who develops a strategic plan?

top-level managers

Abraham Maslow suggested that humans have 5 levels of needs and are motivated to satisfy _________________________________.

unmet needs.

Frank and Lillian Gilbreth

used "MOTION STUDIES" to identify and remove wasteful movements so workers could be more efficient and productive.

Top managers are concerned not only with the organization as a whole but also

with the interaction between the organization and its external environment. This interaction often requires managers to work extensively with outside individuals and organizations.

Evaluate the Decision

What will the "end" look like, i.e., what are the EXPECTED OUTCOMES? Outline the steps to implement. Identify the RESOURCES and ACTIVITIES required. Set the timing (MILESTONES). Assign responsibility.

Government policy

When a firm's patent for a drug expires, other companies can enter the market. The patents recently expired on several drugs made by Merck, including asthma and allergy medicine Singulair. At the same time, several research projects to introduce new, patented medicines were delayed or failed, so Merck had to lay off thousands of employees to cut costs.

Brand identification

When customers are loyal to a familiar brand, new entrants have to spend heavily. Imagine, for example, the costs involved in trying to launch a new chain of fast-food restaurants to compete against Taco Bell or Panda Express. Similarly, Google's recent name change to Alphabet surprised many people because of its brand dominance in the search engine domain. The company hopes the name change and subsequent restructuring will encourage faster growth among its younger, less-known ventures.42

Managers can ask questions such as these:

Who are our current competitors? Are there few or many entry barriers to our industry? What substitutes exist for our product or service? Is the company too dependent on powerful suppliers? Is the company too dependent on powerful customers?55

competition

Who? Strengths? Weaknesses? New ENTRANTS?

Goal of benchmarking is to thoroughly understand the _________________________________________ of other firms and to undertake actions to achieve both better performance and lower costs.

"BEST PRACTICES"

"In matters of style, swim with the current. In matters of principle, stand like a rock."

COLLINS

"five great leaders" - Good to Great

A frontline manager is also referred to as ___________________________________________.

- a lower-level manager

Adapting at the Boundaries

- buffering - smoothing - flexible processes - independent strategies

STABLE, SIMPLE structural approach for managing uncertainty.

- centralized - bureaucratic - standardized work processes

ethical issue

- a situation, problem, or opportunity in which an individual must choose among several actions that must be evaluated as morally right or wrong - arise in every facet of life; we concern ourselves here with business ethics in particular.

Middle-level managers are __________________________ and ___________________________________ CONTROLLERS.

- administrative, supportive

Frontline managers ________________ & __________________ resources.

- attract, develop

Open Systems

organizations that are affected by, and that affect, their environment

Describe the QUALITY source of COMPETITIVE ADVANTAGE...

- basically the excellence of the product (good or service) - attractiveness, reliability, and long-term dependability.

open systems

organizations that are affected by, and that affect, their environment

Myths and Realities About Entrepreneurship

- Anyone can start a business - Entrepreneurs are gamblers - Entrepreneurs want the whole show to themselves - Entrepreneurs are their own BOSSES and completely INDEPENDENT. - Entrepreneurs work harder than managers in big companies. - Entrepreneurs experience a great deal of stress - Entrepreneurs are motivated solely by the quest for the dollar - Entrepreneurs seek POWER and CONTROL over others - If an entrepreneur is talented, then success will happen quickly - Any entrepreneur with a good idea can raise venture capital. - If an entrepreneur has enough start-up capital, he can't miss. - Unless you attained a high score on your SATs or GMATs, you'll never be a successful entrepreneur

Responding to the environment

- Buffering - Smoothing - Flexible processes

What Does it Take, Personally to be an entrepreneur?

- Commitment and DETERMINATION - Leadership - Opportunity OBSESSION - TOLERANCE of risk, ambiguity, and uncertainty - Creativity, self-reliance, and ability to adapt - Motivation to excel

legitimacy

overcoming NEWNESS

What are the characteristics of a decisional role?

- Entrepreneur - Disturbance handler - Negotiator (EDN)

Keeping up with the environment

- Environmental scanning - scenarios - competitive intelligence - forecasting - benchmarking

Regulatory Agencies

- Equal Employment Opportunity Commission - Occupational Safety and Health Administration - Federal Aviation Administration - Food and Drug Administration - National Labor Relations Board

Danger Signs of NOT Acting Ethically

- Excessive emphasis on short term revenues over longer term considerations. - Failure to establish a written code of ethics. - A desire for simple, "quick fix solutions to ethical problems. - An unwillingness to take an ethical stand that may impose financial costs. - Consideration of ethics solely as a legal issue or a public relations tool. - Lack of clear procedures for handling ethical problems. - Responsiveness to the demands of shareholders at the expense of other constituencies.

Describe the PLANNING function of management...

- Specifying GOALS - Deciding the ACTIONS needed to achieve those GOALS

Major challenges facing managers

- Globalization - Technological Change - Importance of KNOWLEDGE and IDEAS - COLLABORATION across ORGANIZATIONAL boundaries. - Increasingly DIVERSE labor force

What are the FIVE major challenges that managers face?

- Globalization - Technological Change - Importance of KNOWLEDGE and IDEAS - COLLABORATION across ORGANIZATIONAL boundaries. - Increasingly DIVERSE labor force

Five elements of an organization's macroenvironment

- Laws and regulations - economy - technology - demographics - social values

What are some characteristics of an interpersonal role?

- Leader - Liaison - Figurehead (LLF)

Implement Goals and Plans

- Managers and employees must UNDERSTAND the plan, have the RESOURCES to implement it, and be motivated to do so. - Successful implementation requires a plan to be LINKED to other SYSTEMS in the organization, particularly the budget and reward systems.

Evaluate Goals and Plans

- Managers will evaluate the advantages, disadvantages, and POTENTIAL EFFECTS of each ALTERNATIVE goal and plan. - Must PRIORITIZE those goals and even ELIMINATE some of them. - Managers must consider carefully the IMPLICATIONS of alternative plans for meeting high priority goals.

What are the characteristics of an informational role?

- Monitor - Disseminator: person who spreads information - Spokesperson (MDS)

Fayol's FUNCTIONS of management

- Planning - Organizing - Commanding - Coordinating - Controlling

Internal EnvironmentStrengths and Weaknesses

- Resources - Benchmarking

Generate ALTERNATIVE plans

- Should stress creativity and encourage managers and employees to think broadly - Goals

Three Common Plans Used by Organizations

- Single-use plan - Standing plan - Contingency plan

SMART goals

- Specific - Measurable - Attainable - Realistic - Timely

The three levels of organizational culture

- Visible artifacts - Values - Unconscious assumptions

What are the characteristics of a bureaucracy?

- a division of labor - authority - qualifications - ownership - rules

What are the essential ingredients for entrepreneurship?

- a great product - a viable market - good timing

Select Goals and Plans

-Managers will select the most appropriate and FEASIBLE alternative. -The evaluation process identifies the PRIORITIES AND TRADE-OFFS among the goals and plans.

Advantages of Using Groups

-More information improves decisions -Different Perspectives enhance problem solving -Group discussions spur thinking -May lead to increased understanding -May increase commitment

Disadvantages of Using Groups

-One person may dominate the discussion and undermine the process -May lead to satisficing -May lead to groupthink -Original goals may be displaced by less important ones

formal decision making

1. Identify and diagnose the problem 2. Generate alternative solutions 3. Evaluate alternatives 4. Make the choice 5. Implement the decision 6. Evaluate/follow up on the decision

Three Criteria Help YouChoose the Best Approach

1. Managers need to change what can be changed 2. Managers should use the appropriate response 3. Managers should choose responses that offer the most benefit at the lowest cost

*Peter Drucker's* five tasks of management:

1. Sets objectives 2. Organises 3. Motivates and communicates 4. Measures 5. Develops people

formal planning steps

1. Situational Analysis 2. Alternative Goals and Plans 3. Goal and Plan Evaluation 4. Goal and Plan Selection 5. Implementation 6. Monitor and Control

authority

A CHAIN OF COMMAND or HIERARCHY is well established.

discounting the future

A bias weighting SHORT-term costs and benefits more HEAVILY than LONGER-term costs and benefits

SWOT analysis

A comparison of strengths, weaknesses, opportunities, and threats that helps executives formulate strategy.

framing effects

A decision bias influenced by the way in which a problem or decision alternative is phrased or presented

maximize

A decision realizing the best possible outcome

Opportunity analysis

A description of the good or service, an assessment of the opportunity, an assessment of the entrepreneur, specification of ACTIVITIES and RESOURCES needed to translate your idea into a viable business and your source(s) of CAPITAL.

Business plan

A formal planning step that focuses on the ENTIRE VENTURE and describes all the elements involved in starting it.

Scenario

A narrative that describes a particular set of FUTURE CONDITIONS - best case, worst case.

Scenario

A narrative that describes a particular set of future conditions

Strategy

A pattern of ACTIONS and RESOURCE allocations designed to achieve the organization's goals.

A strong culture is one in which everyone understands and believes in the firm's goals, priorities, and practices. A strong culture can be a real advantage to the organization if the behaviors it encourages and facilitates are appropriate. Zappos' culture encourages extraordinary devotion to customer service; the culture at Cirque du Soleil encourages innovation, and the culture at Walmart stresses low cost and frugality. Employees in these companies don't need rule books to dictate how they act because these behaviors are conveyed as "the way we do things around here," rooted in their companies' cultures. In contrast, a strong culture that encourages inappropriate behaviors can severely hinder an organization's ability to deal effectively with its external environment—particularly if the environment is undergoing change, as is almost always the case today. A culture that was suitable and even advantageous in a prior era may become counterproductive in a new environment. For instance, a small start-up may have an informal culture that becomes less suitable when the company grows, faces more competition, and requires decision making by a wide range of specialized employees spread out over many locations.

Control system

A system designed to support managers in evaluating the organization's PROGRESS regarding its strategy and, when discrepancies exist, taking CORRECTIVE action.

All the approaches attempted to explain the real issues facing managers and provide them with tools to solve future problems.

Sarbanes-Oxley Act

An act passed into law by Congress in 2002 to establish strict accounting and reporting rules in order to make senior managers more accountable and to improve and maintain investor confidence.

Sociotechnical Systems Theory

An approach to job design that attempts to redesign tasks to optimize operation of a NEW TECHNOLOGY while preserving employees' interpersonal RELATIONSHIPS and other human aspects of the work.

Franchising

An entrepreneurial alliance between two parties Proven (but not failure-proof) business concept Advantage of the franchisor's EXPERTISE Over 782,000 franchised business in the United States

Egoism

An ethical principle holding that individual self interest is the actual motive of all conscious action.

Utilitarianism

An ethical system stating that the greatest good for the greatest number should be the overriding concern of decision makers

An important economic influence is the stock market. When investors bid up stock prices, they are paying more to own shares in companies, so the companies have more capital to support their strategies. Observers of the stock market watch trends in major indexes such as the Dow Jones Industrial Average, Standard & Poor's 500, and NASDAQ Composite, which combine many companies' performance into a single measurement. In recent years, the indexes had risen to great heights, but then they dropped rapidly. The falling prices reflected an economy in which demand for homes and cars had shriveled, credit was difficult to obtain, exports tumbled, and unemployment rates soared.10 Governments launched a variety of stimulus efforts to help companies get financing and to encourage consumers to start spending again. Since then, the stock markets have rebounded as a result of investors having confidence in renewed business growth. The stock market may also affect the behavior of individual managers. In publicly held companies, managers throughout the organization may feel required to meet Wall Street's earnings expectations. It is likely that you, too, at some point in your career, will be asked to improve budget or sales numbers because your company does not want to disappoint "the Street." Such external pressures usually have a positive effect—they help make many firms more efficient and profitable. But failure Page 46to meet those expectations can cause a company's stock price to drop, making it more difficult for the firm to raise additional capital for investment. The compensation of managers may also be affected, particularly if they have been issued stock options. These pressures sometimes lead managers to focus on short-term results at the expense of the long-term success of their organizations, or even worse, to engage in unethical or unlawful behavior that misleads investors.11

Mission

An organization's basic purpose and scope of operations.

Strategic maneuvering

An organization's conscious efforts to change the boundaries of its task environment

Analyze How They Compete Once competitors have been identified, the next step is to analyze how they compete. Competitors use tactics such as price reductions, new-product introductions, and advertising campaigns to gain advantage over their rivals.

Rules and regulations standardize behavior, and authority resides in positions rather than in individuals

As a result, the organization need not rely on a particular individual, but will realize efficiency and success by following the rules in a routine and unbiased manner.

A process for ethical decision making

Being able to recognize which obligations are most at stake in any situation and to weigh them against each other. Duties aren't ranked, but nonmaleficence usually takes precedence.

Complements

Besides identifying and planning for substitutes, companies must consider complements for their products. Classic examples of complementary products include razors and razor blades and printers and cartridges. Revenues from the initial, one-time purchase (razor or printer) are surpassed by the ongoing need to purchase the complementary products (razor blades or cartridges). In another example, automobile manufacturers offer several products and services that are used in conjunction with their automobiles, including windshield wipers, maintenance requirements, and so forth.

Implementation Strategy

DEFINE strategic tasks ASSESS organization capabilities Develop an implementation AGENDA Create an implementation plan

Goals of Transcendent Education

Empathy - feeling your decisions as potential victims might feel them, to gain wisdom Generativity - learning how to give as well as take, to others in the present as well as take, to others in the present as well as to future generations. Mutuality - viewing success not merely as personal gain, but a common victory Civil aspiration - thinking not just in terms of "don'ts" (lie, cheat, steal, kill), but also in terms of positive contributions Intolerance of ineffective humanity - speaking out against unethical actions

qualifications

Employees are selected and promoted based on MERIT.

qualifications

Employees are selected and promoted based on merit

Negotiator

Engaging in negotiations with parties inside and outside the organization.

regulatory agencies:

Equal Employment Opportunity Commission (www.eeoc.gov). Occupational Safety and Health Administration (www.osha.gov). Federal Aviation Administration (www.faa.gov). Food and Drug Administration (www.fda.gov). National Labor Relations Board (www.nlrb.gov). Office of Federal Contract Compliance Programs (www.ofccp.gov). Environmental Protection Agency (www.epa.gov).

Establish a Mission,Vision and Goals. Analyze External Opportunities and Threats Analyze Internal EnvironmentStrengths and Weaknesses SWOT Analysis Formulate Strategy

Cost disadvantages

Established companies may be able to keep their costs lower because they are larger, have more favorable locations, and have existing assets and so forth.

Caux Principles

Ethical principles established by international executives based in Caux, Switzerland, in collaboration with business leaders from Japan, Europe, and the United States.

Distribution channels

Existing competitors may have such tight distribution channels that new entrants struggle to get their goods or services to customers. For example, established food products have supermarket shelf space. New entrants must displace existing products with promotions, price breaks, intensive selling, and other tactics.

First, critics claimed that Taylor ignored many job-related social and psychological factors by emphasizing only money as a worker incentive. Second, production tasks were reduced to a set of routine, machinelike procedures that led to boredom, apathy, and quality control problems. Third, unions strongly opposed scientific management techniques because they believed management might abuse their power to set the standards and the piecerates, thus exploiting workers and diminishing their importance. Finally, although scientific management resulted in intense scrutiny of the internal efficiency of organizations, it did not help managers deal with broader external issues such as competitors and government regulations, especially at the senior management level.

Foreign Corrupt Practices Act (FCPA) prohibits Americans from bribing foreign officials.5

Middle-Level Managers

From administrative controllers to supportive controllers.

Team Leaders

From operational implementer to facilitator of team effectiveness.

Frontline Managers

From operational implementers to aggressive entrepreneurs.

Top-Level Managers

From resource allocators to institutional leaders.

Operating Managers

Frontline Managers

rules

IMPERSONAL rules should be applied consistently and fairly.

Bootlegging

INFORMAL WORK on projects, other than those officially assigned, of employees' own choosing and initiative.

Immigrants are frequently of working age, but some have different educational and occupational backgrounds from the rest of the labor force. The demographic importance of immigration intersects with legal issues governing who is permitted to work in the United States. For example, the federal government recently cracked down not only on undocumented workers, but also on the managers who hired them. It established a new program by which businesses are required to check prospective hires' legal status by submitting their names to a database called "E-Verify."26 Some companies have asked the U.S. government to admit more foreign workers with technical expertise that may be hard to find in the United States. Immigration is one reason the labor force in the future will be more ethnically diverse than it is today. The biggest percentage of employment increases will be by Asian Americans and Hispanic populations, followed by African Americans.

ethical climate

In an organization, the processes by which decisions are evaluated and made on the basis of right and wrong

In contrast, at a company with a weak culture, different people hold different values, there is confusion about corporate goals, and it is not clear from one day to the next what principles should guide decisions. Some managers may pay lip service to some aspects of the culture ("we would never cheat a customer") but behave very differently ("don't tell him about the flaw"). As you can guess, such a culture fosters confusion, conflict, and poor performance.

illusion of control

People's BELIEF that they can INFLUENCE events, even when they have no control over what will happen

examples of resources

People—supplied by trade schools and universities. Raw materials—from producers, wholesalers, and distributors. Information—supplied by researchers and consulting firms. Financial capital—from banks and other sources.

cornerstones of a manager's job.

Performing management functions and roles, pursuing effectiveness and efficiency, and competitive advantage

Figurehead

Performing symbolic duties on behalf of the organization, like greeting important visitors and attending social events.

Virtue Ethcis

Perspective that what is moral comes from what a mature person with "good" moral character would deem right.

Relativism

Philosophy that bases ethical behavior on the opinions and behaviors of relevant other people

Four functions of management

Planning, organizing, leading, controlling

Modern contributors to management

Porter, Hamel, Drucker, Senge, Covey, Collins PHDSCC

Total quality

Preventing defects before they occur. Achieving zero defects in manufacturing. Designing products for quality.

risk and reward

Profitability? Growth? Economy & EXIT?

Disseminator

Sharing information between different people like employees and managers; sometimes interpreting and integrating diverse perspectives.

Ethical Issues

Situation, problem, or opportunity in which an individual must choose among several actions that must be evaluated as morally right or wrong

As a first step in understanding their competitive environment, organizations must identify their competitors. Competitors may include many types of companies:

Small domestic firms, especially upon their entry into tiny, premium markets. Strong regional competitors. Big new domestic companies exploring new markets. Global firms, especially those that try to solidify their position in small niches (a traditional Japanese tactic) or can draw on an inexpensive labor force on a large scale (as in India and China). Newer ventures launched by all types of entrepreneurs.

Societal trends regarding how people think and behave have major implications for management of the labor force, corporate social actions, and strategic decisions about products and markets. For example, during the 1980s and 1990s, women in the workforce often chose to delay having children as they focused on their careers, but today more women are having children and then returning to the workforce. As a result, at companies like Bank of America and PricewaterhouseCoopers, parents who work just 20 hours per week receive full benefits.28 General Mills has introduced more supportive policies, including family leave, flexible working hours, less travel, and Page 49child care assistance.29 Firms provide these benefits as a way of increasing a source of competitive advantage: an experienced workforce.

Four contemporary approaches to management

Sociotechnical systems, Quantitative management, Organizational behavior, Systems theory

14 principles of management

Specialization of Labor, Authority, Discipline, Unity of Command, Unity of Direction, Subordination of Individual interests, Remuneration, Centralization; Scalar Chain (Line of Authority; Order; Equity; Personnel Tenure; Intiative; Espirit De Corps;

Actions and attitudes that provide excellent customer service include the following:

Speed of filling and delivering normal orders. Willingness to meet emergency needs. Merchandise delivered in good condition. Readiness to take back defective goods and resupply quickly. Availability of installation and repair services and parts. Service charges (i.e., whether services are free or priced separately).48

Leading

Stimulating high performance by employees.

Independent strategies

Strategies that an organization acting on its own uses to change some aspect of its current environment.

Five classical approaches to management

Systematic management, Scientific management, Bureaucracy, Administrative management, Human relations

Planning

Systematically making decisions about which goals and activities to pursue.

At the organizational level, firms establish strategic alliances, partnerships, joint ventures, and mergers with competitors to deal with environmental uncertainties. Cooperative strategies such as these make the most sense when two conditions exist:

Taking joint action will reduce the organizations' costs and risks. Cooperation will increase their power (their ability to successfully accomplish the changes they desire).

division of labor

Tasks, assignments, and authority are SPECIFIED

Crucial Management Skills

Technical Skills Conceptual and decision skills. Interpersonal and communication skills.

substitute

Technological advances and economic efficiencies are among the ways that firms can develop substitutes for existing products

In 500 BC, Sun Tzu discussed the importance of PLANNING and LEADING in his book __________________________________________.

The Art of War.

The labor force will continue to grow more diverse. The share of women in the labor force will increase to just over 47 percent. Fast growth of "older workers" will occur to the point that approximately one out of four workers will be 55 and older. Hispanics will grow to about 20 percent, African Americans to nearly 13 percent, and Asians to approximately 7 percent of the labor force. A higher percentage of women than men will join the labor force. White (non-Hispanic) workers' participation in the labor force will decrease from 65 to 60 percent.

The legacy of Taylor's scientific management approach is broad and pervasive. Most important, productivity and efficiency in manufacturing improved dramatically.

Strategic Vision

The long-term direction and strategic intent of a company. Provides a perspective on where the organization is HEADED and what it can BECOME.

Business strategy

The major actions by which an organization builds and strengthens its COMPETITIVE POSITION in the marketplace

Ethics

The moral principles and standards that guide the behavior of an individual or group

The most basic needs are the physical needs for food, water, and shelter; the most advanced need is for self-actualization, or personal fulfillment.

Entrepreneurship

The process by which enterprising individuals INITIATE, MANAGE, and assume the RISKS and rewards associated with a business venture.

Management

The process of accomplishing the goals of an organization through the effective use of people and other resources.

Benchmarking

The process of comparing an organization's practices and technologies with those of other companies.

Operational planning (daily to < 1 year)

The process of identifying the specific PROCEDURES and PROCESSES required at LOWER LEVELS of the organization

Order

order jobs and material so they support the organization's direction.

Today, a company cannot succeed without incorporating into its strategy the astonishing technologies that exist and are under development.

Today, the term bureaucracy generally has a bad connotation. While bureaucratic organizations may be efficient and controlled if the environment is stable, they tend to react slowly to changes in products, technologies, customers, or competitors. Page 57Because bureaucratic organizations tend to be formal and stable, they often cannot adjust to change or exceptional circumstances that "don't fit the rules." In these cases, more organic structures give organizations the flexibility to adapt. Organic structures are less formal than bureaucratic organizations; decisions are made through interaction and mutual adjustment among individuals rather than from a set of predefined rules.

Four different levels of managers

Top, middle, frontline, team leader

What are the four different types of managers?

Top-level manager. Middle-level manager. Frontline manager. Team leader.

order

order jobs and materials so they support the organizations direction

dynamic simple

organic centralized

External environment

everything outside an organization's boundaries that might affect it

quality

excellence of your product or service. "constant and continuous improvement"

Gnatt

expanded on the piecerate system by suggesting that frontline supervisors should receive a bonus for each of their workers who completed their assigned daily tasks

Competitive aggression

exploiting a distinctive competence or improving internal efficiency for competitive advantage (e.g., aggressive pricing and comparative advertising). Ford recently took a bold step in being the first big U.S. automaker to switch from steel to aluminum in the manufacture of its popular F-150 truck series.

contingencies

factors that determine the appropriateness of managerial actions

equity

fair discipline and order enhance employee commitment

Equity

fair discipline and order enhance employee commitment.

Abraham Maslow

five levels of needs

switching costs

fixed costs buyers face when they change suppliers

single-use plan

focuses on achieving non-repeating goals -ex: GMs recent decision to recall 7 million vehicles to fix multiple problems

Max Weber

formulated the bureaucracy approach

Who develops an operational plan?

frontline managers

networks

garnering SOCIAL CAPITAL

Top-Management Teams

gathering effective leadership

Businesses operate on a ____________________ scale.

global

Inputs

goods and services organizations take in and use to create products and services

inputs

goods and services organizations take in and use to create products or services

Opportunities may be created by ____________________________ initiatives and rule changes.

government

Level 1 Costs

government fines and penalties

Coalition

groups that act jointly with respect to a set of political initiatives for some period. Local businesses may band together to curb the rise of employee health care costs, and organizations in some industries have formed industry associations and special interest groups. Life Is Good, a New England-based T-shirt company, used the latest economic downturn to strengthen cooperative action with the retailers that stock its products. Employees at Life Is Good began calling retailers to ask how they could help them through the slow times. Based on the feedback, the firm identified a need to establish online networks that retailers—the company's customers—could use for sharing ideas.75

Frontline managers create and/or pursue _______________________ for the business.

growth opportunities

market culture

has a strong external focus and values stability and control

adhocracy culture

has an external focus and values flexibility

clan culture

has an internal focus and values flexibility rather than stability and control

hierarchy culture

has an internal focus and values stability and control over flexibility

Gantt Charts

helps employees and managers plan projects by task and time to complete those tasks.

Gantt chart,

helps employees and managers plan projects by task and time to complete those tasks. An interesting aspect of the chart is that it illustrates how some tasks need to be done during the same time period.

Top-level managers establish ________________________________________ standards.

high performance

Frontline managers may be responsible for _______________________________________________________________________________________employees in order to achieve their goals and create new growth objectives for the business.

hiring, training, scheduling, compensating, appraising, and if necessary, firing

This approach aimed at understanding how psychological and social processes interact with the work situation to influence performance.

human relations

human relations ignored the more rational side of the worker and the important characteristics of the formal organization. However, human relations was a significant step in the development of management thought because it prompted managers and researchers to consider the psychological and social factors that influence performance.

Organizational behavior

identifies management activities that promote employee effectiveness by examining the complex and dynamic nature of individual, group, and organizational processes.

Managers often think they are ___________________________ to conflicts of interest

immune

rules

impersonal rules should be applied consistently and fairly

Research conducted by the Institute for Global Ethics identified five core ethical values that are found in all human cultures,

including truthfulness, responsibility, fairness, respectfulness, and compassion.

Understanding yourself

including your strengths and limitations as a manager.

Two general types of proactive responses are

independent action and cooperative action.

Competitive pacification

independent action to improve relations with competitors (e.g., helping competitors find raw materials). Kellogg Company promotes the cereal industry as a whole, as well as advertising its various brands.

The _____________________________ promoted a more STRUCTURED approach to work .

industrial revolution

Employees, their organizations, and their communities thrive over the long term when managers apply ethical standards that direct them to act with ________________________________.

integrity

Systematic management emphasized ______________________________________________________________ because managers were concerned primarily with meeting the explosive growth in demand brought about by the industrial revolution.

internal operations

Innovation

introduction of new goods and services.

Conceptual and decision skills

involve the ability to identify and resolve problems for the benefit of the organization and everyone concerned.

strategic value

it contributes to meeting the organization's goals.

scalar chain

keep communications within the chain of command

Scalar chain

keep communications within the chain of command.

cost competitiveness

keeping costs low enough so the company can realize profits and price its products (goods or services) at levels that are attractive to consumers.

moral judgement

knowing what actions are morally defensible

Two basic ethical ideals underpin the Caux Principles:

kyosei and human dignity.

environmental uncertainty

lack of information needed to understand or predict the future

five components of an organization's macroenvironment

laws and regulations, the economy, technology, demographics, and social values.

COVEY

leader's success

Interpersonal Roles

leader, liaison, figurehead

SENGE

learning organization

smoothing

leveling normal fluctuations at the boundaries of the environment

Working effectively with others

listening, showing empathy, motivating, and leading.

Kyosei

living and working together for the common good, allowing cooperation and mutual prosperity to coexist with healthy and fair competition

Kyosei

living and working together for the common good, allowing cooperation and mutual prosperity to coexist with healthy and fair competition.

Top-level managers

organization's senior executives and are responsible for its overall management.

Acquisitions

one firm buys another

merger

one or more companies combining with another

Frontline managers execute the ______________________ activities of the organization.

operational

Profit maximization and corporate social responsibility used to be regarded as leading to _______ ________. But, the two views can converge.

opposing policies

plans

the actions or means managers intend to use to achieve organizational goals

visible artifacts

the components of an organization that can be seen and heard, such as office layout, dress, orientation, stories, and written material

Universalism

the ethical system stating that all people should uphold certain values that society needs to function

universalism

the ethical system stating that all people should uphold certain values that society needs to function

macroenvironment

the general environment; includes governments, economic conditions, and other fundamental factors that generally affect all organizations

Subordination of the individual interest to the general interest

the general interest must predominate

Subordination of individual interest to the general interest

the general interest must predominate.

competitive environment

the immediate environment surrounding a firm; includes suppliers, customers, rivals, and the like

unity of command

the management principle that each person should report to only one supervisor

supply chain management

the managing of the network of facilities and people that obtain materials from outside the organization, transform them into products, and distribute them to customers

Business Ethics

the moral principles and standards that guide behavior in the world of business

ethics

the moral principles and standards that guide the behavior of an individual or group

environmental complexity

the number of issues to which a manager must attend and the degree to which they are INTERCONNECTED.

Franchisee

the operator of one or more stores according to the terms of the ALLIANCE.

benchmarking

the process of comparing an organization's practices and technologies with those of other companies

empowerment

the process of sharing power with employees to enhance their confidence in their ability to perform their jobs and contribute to the organization

outputs

the products and services organizations create

organizational culture

the set of values, ideas, attitudes, and norms of behavior that is learned and shared among the members of an organization

moral character

the strength and persistence to act in accordance with your ethics despite the challenges

The third and deepest level of an organization's culture refers to unconscious assumptions,

the strongly held and taken-for-granted beliefs that guide behavior in the firm

The second level of culture refers to its values values,

the underlying qualities and desirable behaviors that are important to the organization

Managers often hire people who are like ________________________.

themselves

Chapter 1: Managing Effectively in a Global World POWERPOINT, Chapter 2: The Evolution of Management POWERPOINT, Chapter 3: The Organizational Environment and Culture POWERPOINT, Chapter 4: Ethics and Corporate Responsibility POWERPOINT, Chapter 5: P...

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