Management

Blue Ocean Strategy/ Value innovation

- Is not: matching your competitors strategy - Is not: leveraging existing assets + Is: thinking as a new entrant, put aside conventional logic and existing industry assumptions, new creative thinking, focus on what most customers want, offering unprecedented value differentiate at low cost

What can a great boss do?

- inspire you professionally - energize you and co-workers to accomplish things together that couldn't get dobe by yourself - provide coaching and guidance with problems - provide feedback on how you're doing - help you to improve your performance - keep you informed of organizational changes > change your life

Maslow - motivation

Hierachy of NEEDS; physiological > safety > social > esteem > self-actualisation = People value needs/rewards differently

High vs Low context culture

High Context Culture Establish social trust first Value personal relations and goodwill Agreement by general trust Negotiations slow and ritualistic Polychromic time Intimate personal space Low Context Culture Go down to business first Value expertise and performance Agreement by legal contract Negotiation as efficient as possible Monochromic time Personal/ social space

Innovation is important for the survival of a company in a market.

Innovation= turning the outcomes of the creative process into useful products, services, or work methods. Exploitation: includes such things as refinement, choice, production, efficiency, selection, implementation, execution.

Theory X and Y (Mc. Gregor),

= Theory X: assumes that workers have little ambition, dislike work, avoid responsibility, and require close supervision. = Theory Y: assumes that workers can exercise selfdirection, desire responsibility, and like to work ! These led him to assume: motivation is maximized by participative decision making, interesting jobs, and good group relations. > No evidence that either set of assumptions is valid

The 5 forces that that shape strategy - Porters framework

Forces influencing competition and hence PROFITABILTY (rate of return to capital relative to its costs of capital). Profitability has to do with: - Pricing power/sales o Customers the value of the product / substitutes - bargaining power o Competition intensity - new entrants? - Costs o Suppliers bargaining power (costs) IO (Industrial Organization Economics) => Industry and the place of the firm in its industry are determinants for performance and hence for strategy. A competitive advantage is derived from the place in the industry Industry analysis is key, where compete? Analyse sources of profit in the external environment. Corporate strategy: which industry to go for? Business strategy (positioning), how to get and sustain competitive advantage?

What can we use Porters framework for

Forecast future industry profitability: Is my competitive advantage sustainable? - Rivalry - Are new entrants seeking to enter? - Substitutes form other industries? - Evolution of buyers? - Evolution of suppliers? Should I (Re)Position my Business, CA is weak - Where place in the industry where the forces are the weakest? - How to differentiate?

The management of Whole Foods

Founded by John Mackey (CEO) and Renee Lawson Hardy in 1980 in Austin, Texas. Focused on the retail of natural products with a "green mission" It is quoted on the stock exchange and had 270 shops, over 54000 "team members" and a turnover of around 6 billion USD (a high turnover per square meter)."High trust organisation"; • Less management (decentralised self-managed teams) including peer evaluation, teams choosing their own products and buying from local farmers. • A mission/purpose to create a community that binds people ("Whole foods, Whole people, Whole planet" focusing on sustainability and Fairtrade/CSR.) • Remuneration- the highest pay is 19 times the average pay Creating a culture of transparency, trust and fairness

Contemporary Issues in Managing Human Resources

a) Managing Downsizing b) Managing Workforce Diversity c) Changing psychological contract d) Sexual Harassment e) Workplace Romances f) Work-Life Balance g) Aging workforce (baby boomers) and growing cohort of generation Y'ers

A culture's basic functions:

a. Code of conduct: coordination and control mechanism b. Defines boundaries c. Conveys a sense of identity d. Generates commitment beyond oneself e. Enhances social stability (social glue) o Sense of direction of decisions o Sensemaking o Person-organization fir o Acts like formalization Culture is NO of the shelf recipe. The best managers/organizations have adaptive cultures, they pay attention to their constituencies, initiate change when needed, and take risks.

Leadership is culturally bound

o France: more a bureaucratic view on leaders, task oriented, relatively autocratic o Nordic countries: leaders are interpersonal, enthusiastic, sincere, informal, trustworthy, inspirational o Germany, Austria, Switzerland: independent, autonomous, unique o Latin countries: visionary, team oriented and status conscious o US: obsession with leadership, the sky is the limit

Level five leadership = highest level

o Individual capability o Team skills o Managerial competence o Ability to stimulate others o Personal humility and professional will

Ethical leadership

o Reputation as: Moral person • Honesty, trustworthy, integrity • Genuine concern for other people • Is very approachable • Fair and principled individual o Moral manager • Creates a strong ethical message that influence subordinates' thoughts and behavior • Role model • Ethical goals • Ethical rewards/punishment

Other things that influence our ethical sensitivity:

o The role you have to play (nice secretary, CEO,...) o The false consensus effect: the tendency to believe that other people think the same way as we do Honest people: believe that the others are also honest people are not good at detecting when they are being lied to (especially when firm has good ethical reputation) - Others do not necessarily have the same intentions as yours - Others do not necessarily think the way we do o Obedience to authority: we are inclined to follow orders 'befehl ist befehl' (Milgram experiments). People don't always do it when specifically ordered also because of fear, rewards,... o Rationalization: in order to keep a positive self-concept , people often rationalize or self-justification "we had no other choice" o Peer/social pressure: you change your perception of reality to fit in. Conformity, group cohesiveness > individual freedom of expression. Think Asch experiment - Organizational culture also acts as pressure. Ethical codes < culture (not same as stated values) o Framing: how facts are (re)framed can produce a totally different answer from the same respondent. Organizational culture can also be a frame (profit, market share,...) o The Tangible, the Close and the Near Term/delay trap: tangible factors that affect those near to us/ immediate have a greater impact than factors abstract/far removed in space/time. o Biases (see decision making)

Transactional vs. transformational leadership

o Transactional: Leaders who lead primarily by using social exchanges (or transactions) Pursues a cost benefit, economic exchange to meet subordinates current material and psychic needs in return for "contracted" services rendered by the subordinate. o Transformational: Leaders who stimulate and inspire (transform) followers to achieve extraordinary outcomes. Transformational leadership via the "4 I's": • Inspirational motivation - Providing vision and sense of mission, instills pride, gains respect and trust - Supported by communication skills that make the vision understandable, precise, powerful and engaging • Idealized Influence - Leaders must be credible, are role models • Intellectual Stimulation - Promotes intelligence, rationality and creativity - Challenge assumptions to look at old problems in new ways • Individualized Consideration - Gives personal attention, treats each employee individually, coaches, advises - Increases self-efficacy

Environment Step 7: Retaining: Compensation and Benefits:

o Types of Compensation: base wage/salary (level & seniority), wage and salary add-ons

Motivating Unique Groups of Workers

o Women are more motivated to get along and desire learning opportunities, flexible work schedules, and good interpersonal relations. o Men are more motivated to get ahead, desire more autonomy than do women o Professionals • Loyalty is to their profession, not to the employer. • Have the need to regularly update their knowledge. • Don't define their workweek as 8:00 am to 5:00 pm. • Job challenge • Organizational support of their work o Low-Skilled, Minimum-Wage Employees • Good wage/bonus • Employee recognition programs • Provision of sincere praise

Redesigning job design approaches:

o relational perspective of work design: an approach to job design that focuses on how people's tasks and jobs are increasingly based on social relationships o proactive perspective of work design: an approach to job design in which employees take the initiative to change how their work is performed o high-involvement work practices: work practices designed to elicit greater input or involvement from workers

Trait theories

"Great man" theories (1940s-1950s, Stogdill & Mann) = Theories that consider personality, social, "physical", or intellectual traits to differentiate leaders from non-leaders = difficult and impossible to find special traits that were there for ALL leaders. Revival of trait theories 1980's - Mental models about leadership: • Implicit Leadership Theories; Lord DeVader & Alliger 1986. Implicit Leadership Theories assert that people's underlying mental models influence the extent to which they view someone as a good leader • The Leadership Practices Inventory (=top 20000) Kouzes, M., J., & Posner, B., Z. (1995) 1. Integrity - honesty and trustworthiness 2. Intelligence - Intellectual ability including verbal, perceptual, and reasoning capabilities 3. Self-Confidence - Ability to be certain about one's competencies and skills 4. Determination - The desire to get the job done (i.e., initiative, persistence, dominance, drive) 5. Sociability - > 7 traits of Kirckpatrick & Locke (1991) > The big V theory of the 1980's > Role of EQ

Quantative approach/ Management science perspective/Operations research

(1940 - 1950); the use of quantitative techniques to improve decision making) Focuses on improving managerial decision making by applying: statistics, optimization models, information models, and computer simulations. (Ex. Queuing, inventory, break even,...) Quantative app feeds directly into areas of management of planning and control. >> Quantitative techniques are used frequently in total quality management (TQM)

Vertical differentiation/ lines of authority

(= the rights inherent in a managerial position to tell people what to do an to expect them to do it) - Chain of command: continuous lines of authority extending from upper organizational levels to the lowest levels within an organization, which clarifies who reports to who - The number of layers depends on the span of control; the number of employees who can be effectively & efficiently directly supervised by a manager. Width of span is affected by; o managers skills/ abilities, o Characteristics of the work/employees o the physical proximity of subordinates ⎝ Bigger organisation = more layers = bad communication, slow decision making, high bureaucratic cost, Parkinson's law (managers want subordinates) ! Span of control can be enlarged by decreasing the need for direct supervision ♣ standardization/ formalization of tasks ♣ empowerment - training ♣ strong culture ♣ Sophistication of the organization's information system ! Supervision = motivation

Motivational theories

(A) Old theories based on needs: Maslow, theory X&Y, Two-factor theory by Herzberg, McClelland theory of needs (B) Contemporary theories: cognitive evaluation, goal setting, reinforcement, equity, expectancy, motivating by job design

The tasks of a manager can be described with multiple models

(A) The 4 functions: 1. Planning: setting goals, establish strategies to achieve these and develop plans to integrate and coordinate activities 2. Organizing: arranging and structuring work to accomplish the organizational goals 3. Leading: working with and through people to accomplish organizational goals 4. Controlling: monitoring, comparing and correcting work performance (According to Fayol there were 5: minus leading plus commanding and coordinating. They use resources. (B) Mintzberg's managerial roles: specific actions/behaviors expected from and exhibited by a manager 1. Interpersonal role: involves people and other duties that are ceremonial and symbolic in nature. They must be a; leader, figurehead and liaison 2. Informational role: involves collecting, receiving and disseminating information. They must be a; monitor, disseminator and spokesperson 3. Decisional role: revolves around decision making and they must be a; entrepreneur, disturbance handler, resource allocator and negotiator > As managers perform these roles, Mintzberg proposed that their activities include both reflection (thinking) and action (doing) >> Generally function models more used

Why are (a) customers (b) social media (c) innovation and (d) sustainability important for managers?

(a) Customers: managers should create a customer-responsive organisation where employees are friendly and accessible, and willing to do what's necessary to pleasure the customer (e.g. Cisco) (b) Social media: with the technology evolving, more and more businesses are turning to social media not just to connect with the customers, but also as a way to manage their Human Resources, communication, teams, strategy and tap into their innovation of social media (e.g. Supervalu) (c) Innovation: exploring new territory, takin risks and doing things differently. Innovation is just not about technology but it can be found in a lot of types of organizations. (Ex. best buy) (d) Sustainability: a company's ability to achieve its business goals and increase long-term shareholder value by integrating economic, environmental, and social opportunities into its business strategies. (ex. Walmart)

Ethical values also influence strategy

(constraints on means business can use, builds internal consensus & commitment=↗effectiveness) ! Most successful businesses are those with other motivation than profit

Stakeholder theory/approach advantages

+ Image, brand + Reputation + Reduces risks of liability, costly legal expenses + Preventing that a company is targeted by all kinds of pressure groups and NGOs

Hersey and Blanchard Situational Leadership Theory Model

, different stages of readiness: -- R1: People are both unable and unwilling to take responsibility for doing something. Followers aren't competent or confident. -- R2: People are unable but willing to do the necessary job tasks. Followers are motivated but lack the appropriate skills. -- R3: People are able but unwilling to do what the leader wants. Followers are competent, but don't want to do something. -- R4: People are both able and willing to do what is asked of them. > Leader should be flexible and change according to subordinates needs.

Goals of strategy

- Profit link vision/mission to it because profit doesn't "isnpire" - Value for customer competitive advantage (money that customers are willing to pay) o CA: advantage that firm has over competitors, its distinctive edge (ex. Apple: innovative) - Vision: mental image of a possible and desired FUTURE of the firm (short & strong) framework for strategy - Mission: identity kit of the firm, purpose of organization (differentiates firm from competitors) basis for strategy

Expatriates: often inept and prone to failure because

- Spouse cannot adjust - Lack of proper motivation for a foreign assignment - Immature - Sometimes, not technically competent

Characteristics Gen Y

- They want to work but don't want work to be their life - work life balance! - They are changing careers fast and don't like to stay on one assignment too long, with a higher value on self fulfilment - A generation or multi-taskers, that are technically savvy - Much less likely to respond to the traditional command-and -control type of management - VERY demanding (small family) - Challenge status quo (gang van zaken) ≠ followers, question their superiors, self-fullfilling

Weak Cultures

- Values limited to a few people - usually top management - Culture sends contradictory messages about what's important - Employees have little knowledge of company history or heroes - Employees have little identification with culture - Little connection between shared values and behaviours (= weak influence on behavior)

Strong Cultures

- Values widely shared and intensely held - Culture conveys consistent messages about what's important - Most employees can tell stories about company history/ heroes - Employees strongly identify with culture - Strong connection between shared values and behaviours (= strong influence on behavior)

Horizontal differentiation (departmentalization/specialization)

- Work specialization/division of labor: the degree to which activities in the organization are subdivided into separate jobs ! At some point no longer beneficial, human diseconomies > advantages. - Departmentalization: the basis by which jobs are grouped together. There are multiple ways: o Functional departmentalization o Product departmentalization o Client departmentalization o Geographic departmentalization ! Too much departementalization can lead to disintegration (solutions: integration mechanisms: centralization, ICT, teams-task forces, liasons officers, informal contacts,...) - Matrix departmentalization/cross-functional team: an organizational design that assigns specialists from various functional departments to work on projects. + Information/knowledge=easily transferred from one product/project to another + Functional economies of scale (schaalvoordelen) + Easy transfer of personal, allows for flexibility - A lot of meetings for some - Too much responsibility, not enough authority (half delegation) - Lack of synchronization when work must be done, insufficient communication between the units - Unclear roles and responsibility - Two bosses (duality of command) and power games - Departementalization by Outsourcing: outsourcing to different countries, companies. Is very flexible and "lightweight" but you lose control.

Other types of configurations of ideal organization structures

1) Network organisation (contemporary structure) • A small core of employees with creative core teams using outsourcing and temporally hired people also. • Often very virtual using Intranets and ICT for communication 2) Learning organization (ex. Google) • Developed the capacity to continuously learn, adapt and change through the practise of knowledge management by employees • Open and team based, empowering employees with leadership provides a shared vision of the future and leads to extensive/ open information sharing and empowerment • Culture = shared values, trust, openness, sense of community 3) Boundary-less organisation • Eliminating internal boundaries through low horizontal/ vertical differentiation, using empowered teams rather than departments and having a limitless span of control • Eliminating external boundaries that separate the country from its customers, supplies and stakeholders, this is often done through virtual network designs, open innovation and strategic partnerships 4) Missionary (ideological) organization • Uses of norms, ideology, standards and procedures mainly found in Japanese org., service clubs, alumni associations, political parties and possess a strong sense of survival • The environment is unstable and complex with members often working for free • Strategy = mission is at the core, worldview Problems = when ideals, values and ideology are converted to concrete objectives members often no longer recognise their organisation and believe its objectives are no longer pure

Ways to enrich a JCM

1. Combine tasks. Put fragmented tasks back together to form a new, larger work module (job enlargement) to increase skill variety and task identity. 2. Create natural work units. Design tasks that form an identifiable and meaningful whole to increase employee "ownership" of the work. Encourage employees to view their work as meaningful and important rather than as irrelevant and boring. 3. Establish client (external or internal) relationships. Whenever possible, establish direct relationships between workers and their clients to increase skill variety, autonomy, and feedback. 4. Expand jobs vertically. Vertical expansion gives employees responsibilities and controls that were formerly reserved for managers, which can increase employee autonomy. 5. Open feedback channels. Direct feedback lets employees know how well they're performing their jobs and whether their performance is improving or not.

Organization

1. DIVISION OF LABOR OR DIFFERENTIATION 2. COORDINATION

How to pursue a resource based strategy?

1. Functional analysis /functional level strategy a. Corporate functions (Innovation, strategic management, financial control) b. R&D (innovative product development) c. Operations (continuous improvement, fast fashion) d. Marketing (branding, following market trends) e. Sales and distributions (speed, quality/ effectiveness of service) 2. Value chain analysis / what are my key resources? 3. Use Grant's framework (resources & capabilities) VRN/O

Hofstede's 5 dimensions of national culture

1. Individual vs Collective 2. Power distance 3. Uncertainty avoidance 4. Achievement vs Nurturing 5. Long-term vs Short-term orientation

The Five Dimensions of Strategy

1. Industry Assumptions Conventional Logic: Industry's conditions are given. Value Innovation: Industry's conditions can be shaped. 2. Strategic Focus Conventional Logic: A company should build competitive advantages. The aim is to beat the competition Value Innovation: Competition is not the benchmark. A company should pursue a quantum leap in value to dominate the market. 3. Customers Conventional Logic: A company should retain and expand its customer base through further segmentation and customisation. It should focus on the differences in what customers value. Value Innovation: A value innovator targets the mass of buyers and willingly lets some existing customers go. It focuses on the key commonalities in what customers value. 4. Assets and Capabilities Conventional Logic: A company should leverage its existing assets and capabilities. Value Innovation: A company must not be constrained by what it already has. It must ask, What would we do if we were starting anew? 5. Product and Service Offerings Conventional Logic: An industry's traditional boundaries determine the products and services a company offers. The goal is to maximise the value of those offerings. Value Innovation: A value innovator thinks in terms of the total solution customers seek, even if that takes the company beyond its industry's traditional offerings.

Environment Step 4: Orientation and training

1. Orientation-socialization: education that introduces a new employee to his or her job and the organization (organizational culture). 2. Employee Training : training for the job

Environment Step 5: Employee Performance Management

1. Performance Management System: process of establishing performance standards and appraising employee performance. - Performance appraisal methods: BARS (Behaviour anchored rating scale), 360 degree appraisal/feedback,...

Environment Step 2: Recruitment and Decruitment

1. Recruitment: the process of locating, identifying, and attracting capable applicants to an organization o Recruit/promote from within o Recruit externally 2. Decruitment: the process of reducing a surplus of employees in the workforce of an organization o Firing/ lay offs o Attrition (not refilling openings) o Transfers o Reduced workweeks (e.g. 0 hour contracts) o Early retirements

Porters framework

1. Rivalry between established firms a. Concentration: number and size. High concentration when 1 dominant competitor Lower concentration = higher internal rivalry. b. Industry growth: slower industry growth= higher the internal rivalry (fight market share) c. Low switching costs to switch brands: switching cost can be: money, time, psychologic,. Lower cost for switching brand = the higher the internal rivalry d. Excess capacity: more excess capacity = stronger internal rivalry e. Product differentiation: Less differentiation = stronger internal rivalry f. High exit barriers that keep unprofitable firms from leaving the industry: higher exit barriers = stronger internal rivalry g. Perishable products: more perishable products= stronger internal rivalry h. Economies of Scale: decreased per unit cost as output increases (car) The more the industry is characterized by economies of scale = stronger internal rivalry i. Industries where fixed costs are high v.a.v. variable costs (hotels, airlines) The more the industry is characterized by this = stronger internal rivalry 2. Threat of entry: how much of a threat there is from new entrants to already existing firms. Prices go down, decline in profitability and more capacity. There are some BARRIERS to ENTRY: a. Capital requirements: higher capital requirements, the higher barrier to entry b. Economies of Scale: the higher economies of scale, the higher barrier to entry (because fixed costs high & takes time to make money back ex R&D, Capital intensive industries) c. Absolute cost advantages: can be due to access to raw material (labor, oil,...) or learning and experience. Higher absolute cost advantages, the higher barrier to entry d. Product differentiation: higher the degree of differentiation, the higher the barrier to entry e. Access to channels of distribution: (shelfspace but internet?) more difficult access to distribution, the higher barrier to entryµ f. Governmental and legal barriers: more governmental and legal barriers, the higher barrier to entry g. Retaliation: (empire strikes back, pay back) the higher the chance of retaliation, the higher the barrier to entry 3. Threat of substitutes from adjoining industries (ex. Threat of substitutes from adjoining industries). Substitutes are dangerous when a. High price sensitivity b. Switching costs are low 4. Bargaining power of buyers: buyers can: a. Force prices down b. Demand better quality c. Play suppliers off against each other 5. Bargaining power of suppliers: suppliers are powerful, quasi monopoly. They can: a. Forcing prices up b. Deliver less quality

Environment Step 3: selection

1. Selection process: screening job applicants to ensure that the most appropriate candidates are hired. Predicting which applicants, if hired, will be (or will not be) successful in performing well on the criteria the organization uses to evaluate performance. 2. Avoid Selection errors: reject errors for potentially successful applicants, accept errors for ultimately poor performers o Use selection tools: application forms, written tests, performance simulations tests,... o Testing personality: big five model, Myers-Briggs personality Type Indicator(ESTP), Rorschach Inkblot Test, Personality-Job Fit: Holland's (RIASEC) Hexagon,...

EI (Emotional Intelligence) - managerial skills

1. Self-awareness: ability to read ones emotions (and recognize their impact while using gut feelings to guide decisions) 2. Self-management: involves controlling emotions and impulses (adapting to changing circumstances) 3. Self-motivation: the ability to persist in the phase of setbacks and failures 4. Relationship management: the ability to inspire, influence and develop others while managing conflict

Contemporary/modern approaches (1960 - now)

1. TQM 2. System approach 3. The contingency approach 4. Six sigma

Managerial skills according to Katz

1. Technical: job-specific knowledge and techniques needed to proficiently perform work tasks. Most important lower tier managers. 2. Human/Interpersonal: ability to work with other people, individually or in a group. Equally important for every sort of manager. 3. Conceptual: ability to think and conceptualize about abstract and complex situations (seeing organization as a whole). Most important higher tier managers

Leadership theories

1. Trait theories 2. Behavioural theories 3. Situational theories 4. Path-goal theory 5. LMX theory 6. New leadership paradigm

McClelland's Theory of needs/three-needs:

3 acquired (not innate) needs are major motivators 1. Need for Achievement (nAch): drive to excel & succeed in relation to a set of standards 2. Need for Power (nPow): need to make others behave in a way they wouldn't otherwise 3. Need for Affiliation (nAff): desire for close and interpersonal relationships > These are calculated with: TAT (Thematic Apperception Test): pictures, write story abt Good managers : high nAch

Environment Step 1: Human Resource (HR) Planning

= The process by which managers ensure that the right number and kinds of people are in the right places, and at the right times, who are capable of effectively and efficiently performing their tasks. o Steps in HR planning 1. Assessing current human resource • Human Resource Inventory • Job Analysis: defining a job and behaviours necessary. Requires o Job Description: written statement that describes a job. o Job Specification: written statement of the minimum qualifications that a person must possess to perform a given job successfully 2. Assessing future needs for human resources • Factors Affecting Staffing o Strategic goals, turn-over rate, outsource?

Fiedler Model (Contingency Theory of Leadership)

A leadership theory proposing that effective group performance depends on the proper match between a leader's style and the degree to which the situation allows the leader to control and influence. Leaders are either task motivated or relationship motivated ((Least Preferred Co-worker questionnaire, high = relationship, low = task) ! For a certain SITUATION (degree of control) there is a best leadership style OR change situation in order to fit the your leadership style OR change leader ! Situational contignencies: - Leader-member relations: confidence, respect, trust (Good/poor) - Task structure: are jobs formalized and structured (High/low) - Position power/influence a leader has: punishment, reward, hiring, firing (Strong/weak) All situations have good Leader-member relations and one of the other contingency variables is positive and high control situation or favorable for the leader Task behavior All situations have poor Leader-member relations low Task structure low control situation or not favorable for the leader Task behaviour All the other combinations moderate control situation Relationship behaviour

Leadership

A process of influencing a group to achieve goals. >> Influences; subordinates, ethical shortcomings, motivation, job satisfaction, performance

The Boston Consulting Matrix:

A strategy tool that guides resource allocation decisions on the basis of market share and growth rate of a strategic business unit • Star: high market share/high anticipated growth rate • Cash cows: high market share/low anticipated growth rate • Question marks: low market share/high anticipated growth rate • Dogs: low market share/low anticipated growth rate

Creativity

Ability to combine ideas in a unique way or to make an unusual association. Exploration: includes things captured by terms such as search, variation, risk taking, experimentation, play, flexibility, discovery, ... Good companies integrate both and are ambidextrous

Ethical sensitivity

Ability to recognize the ethical or moral implications of situations. It is limited by: >> Cognitive limitations can lead people to make unethical decisions & organizational culture

Charismatic leadership

An enthusiastic, self-confident leader whose personality and actions influence people to behave in certain ways o Inspire a shared vision an idealized goal, a future that is better than the status quo o Are willing to take personal risks (self sacrifice) to achieve that vision o Model the way: exhibit behaviors that are out of the ordinary, unconventional behaviour o Enable others to act: teamwork and cooperation o Encourage the heart: Sensitive to needs of the followers and rewarding themµ: Charisma can be made till a certain degree, create an aura; optimism, passion, enthusiasm, communicate w/ body, eye contact,... o Can be dangerous: • Use organizational resources for personal benefit • Remake companies in own image • Allow self-interest and personal goals to override organization's goals • No critic: surrounding themselves with yes people

Corporate and business strategy:

An organizational strategy that determines what businesses a company is in and wants to be in and what it wants from those businesses. 1. Corporate-Level Strategy: what business/industry/markets are we in? Investment, diversification, acquisitions, divestments, allocation of resources between businesses? 2. Business-Level Strategy: how do we compete/reach competitive advantage? 3. Functional-Level Strategy: how do we support the business-level strategy?

Diversified/division organization

Answer how to expand and keep control over the range of business, how to exploit synergies • Made in a simple and unstable environment controlled by HQ • Coordination mechanism leads to a standardization of output, relatively 'autonomous' • machines. • Strategy = strong overall corporate, focussing on diversification, movement of funds • Culture = very risk adverse • Structural dimensions = standardization of output, centralization by HQ, delegation of authority, often matrix (based on products/ regions) - Problems = one division can pull down the whole organisation (e.g. conflicts between budget division), ineffective boards, big administration and economic goals outweighing social goals, not always innovative however often buy innovative organisations.

Control

Before, during & after vs. mutual agreement

Reinforcement theory:

Behavior is a function of its consequences. Consequences that immediately follow a behavior & increase probability that behavior will be repeated= reinforcers. 1. This theory uses reinforcers and punishment, however it is better to do nonreinforcement than punishment.

The contingency factors:

Close fit between contingency factors and design parameter, more specifically, that structure must reflect situation. • age and size, • technical system, • environment • power

Randomness bias

Creating unfounded meaning out of random events

Intuitive decision making

Decisions based on the implicit knowledge (experience, feelings and accumulated judgement) available to a decision maker. Used with rational decision making and when rushed mostly intuitive decisions Do not take intuition as face value.

Types of change (change management)

Disruptive change (calm waters metaphor): abrupt change brought about by (dramatic) changes in the environment. Kurt Lewin's 3 step program for disruptive change: unfreezing, changing, freezing & Carnalls coping cycle See star model CH3, 4 Continuous change (white waters metaphor): open ended change, rather in cycles.

Situational theories:

Do not forget the situation! Is the "9,9 type" always the best in each situation? This theory focusses on the followers readiness (extent to whivh people have the ability and willingness to accomplish a specific task) - Hersey and Blanchard Situational Leadership Theory Model - Fiedler Model (Contingency Theory of Leadership)

Mintzberg - Five basic mechanisms of coordination/structural dimensions

Each of the five configurations relies on one of the five coordinating mechanism and tends to favor one of the five parts • Mutual adjustment/mutual agreement/informal communication: individuals coordinate their own work, by communicating informally with each other. • Direct supervision: one individual (typically a manager) gives specific orders to others and thereby coordinates their work. • Standardization of work processes: the work is coordinated by the imposition of standards to guide the doing of the work itself, work orders, rules and regulations,. (analyst, technostructure) • Standardization of outputs: the work is coordinated by the imposition of standard performance measures or specifications concerning the outputs of the work. (analyst, technostructure) • Standardization of skills/input (professionalism): the work is coordinate by the internalization by individuals of standard skills and knowledge, usually before they begin to do the work • Standardization by culture/set of beliefs

Equity theory (J. Stacey Adams):

Employees compare input-outcome ratio with the input-outcome ratio of relevant others and correct inequity. Employees compare themselves to referents: persons, systems or selves individuals to assess equity (want fairness) 1. Distributive justice= perceived fairness of the amount and allocation of rewards among individuals. Has a greater influence on job satisfaction 2. Procedural justice= perceived fairness of the process used to determine the distribution of rewards. Has a greater influence on organizational commitment, trust in supervisors and intention to quit > Cognitive dissonance: how do we react if the relevant other has more/less than us?

There are 5 basic types/configurations of ideal organization structures

Entrepreneurial (simple) organization Machine organization Diversified/division organization Professional organisation Adhocracy or innovative organisation

Cognitive evaluation theory

External events can impact intrinsic motivation • Extrinsic rewards (deadlines, pay & surveillance) tend to reduce intrinsic motivation • Other extrinsic rewards, (positive feedback, trophies) tend to intensify intrinsic motivation • Depends whether event/reward promotes or not greater perceived competence (self-efficacy = individual's belief that he/she is capable of performing a task)

What we learn from older motivation theories?

Extrinsic motivation o People look for security, pay, job security o Individuals engage in behaviors merely because of the objective consequences they might attract, such as tangible rewards or praise Intrinsic motivation o People have social needs o Some people seek personal growth o Individuals engage in behaviors they perceive as inherently interesting, satisfying, gratifying, enjoyable, fulfilling, and absorbing

Open innovation

Get outside your industry, go to the business ecosystem

Human resource management

Getting the right number of people in the right place at the right time

The steps in how environment affects HRM

HR planning > recruitment (or derecruitment) > selection >> Identify and select competent employees > orientation > training >> provide employees with up-to-date skills and knowledge > performance management > compensation and benefits > career development >> retain competent and high-performing employees

New leadership paradigm:

How can leaders get outstanding results such as growing from an entrepreneurial firm (eg. Apple, Google, Microsoft), corporate turnarounds (eg. GE)? How leaders achieve extraordinary followership, trust, admiration, motivation • Affective elements of leadership • Symbolic and emotionally appealing aspects of leadership • Followers are not only satisfied, but adhere to visions... a. Transactional vs. transformational leadership b. Charismatic leadership: c. Level five leadership = highest level d. Authentic leadership e. Ethical leadership

Availability bias

How likely an event will happen based on how easily an example can be brought to mind

Formalization/standardization:

How standardized an organization's jobs are and the extent to which employee behavior is guided by rules and procedures. o Standardization of processes (HOW) Procedures o Standardization of output (How much) o Standardization of Input (Who) o Standardization by culture= socialization (here no formalization) >> In reality all forms used at same time

Which resources & capabilities are interesting? VRIN framework:

In order to offer a competitive advantage, resources and capabilities should be: o Valuable (relevant to the success factors and the most important condition) o Rareness (not possessed by other firms and this does not imply that 'common resources' are not important) o Imperfectly imitable (a sustainable competitive advantage due to historical conditions, casual ambiguity, social complexity) o Not Substitutable (a sustainable competitive advantage due to historical conditions, casual ambiguity, social complexity) o Organised to capture value

Two factor theory (Motivation-Hygiene theory), Herzberg:

Intrinsic factors (achievement, recognition,...) lead to job satisfaction and motivation whereas extrinsic factors (company policy, supervision,...) are associated w/ job disaffection. • Herzberg: satisfaction no satisfaction & dissatisfaction no dissatisfaction = Hygiene factors: extrinsic factors that create job dissatisfaction. These factors eliminate dissatisfaction but don't motivate = Motivators: intrinsic factors having to do with the job itself, they increase job satisfaction and motivation. - Some dissatisfiers are actually motivators (ex. Job security) > High salary ≠ motivation = not dissatisfied. However salary too low: People will revolt => salary is a conditio sine qua non. Is there procedural justice (rewarding = equal?)

Critiques on Porters framework

Only some forces get empirical supper, missing players (government, complements), limited attention for changing demand

Behavioral theories: style vs skill approach

Leadership theories that identify behaviors that differentiate effective from non-effective leaders. a. Style approach 1940's: behavior of leader, certain behavior influences subordinates' effectiveness University of Iowa * autocratic style: a leader who dictates work methods, makes unilateral decisions, and limits employee participation * democratic style: a leader who involves employees in decision making, delegates authority, and uses feedback as an opportunity for coaching employees * laissez-faire style: A leader who lets the group make decisions and complete the work in whatever way it sees fit Democratic style of leadership was most effective, although later studies showed mixed results. Ohio State University Studies: * Initiating structure: the extent to which a leader defines his or her role and the roles of group members in attaining goals * Consideration: The extent to which a leader has work relationships characterized by mutual trust and respect for group members' ideas and feelings A high-high leader: good in both IS and C. University of Michigan Studies * Employee oriented: emphasized interpersonal relationships and taking care of employees' needs * Production oriented: emphasized technical or task aspects of job Employee-oriented leaders were associated with high group productivity and higher job satisfaction. Blake & Mouton's "Managerial/leadership grid" two-dimensional grid for appraising leadership styles look up pic b. Skills approach: What skills and abilities do you need to be an effective leader? Problem solving skills: creative ability to solve unusual, new organizational problems • Defining the problem, gathering information, defining plans for solutions... Social judgment skills: capacity to understand people and social systems • Working together, gain support, understanding others, what they want, being flexible, communication and persuasion skills... (Technical) knowledge

Line and staff authority

Line authority: authority that entitles a manager to direct the work of an employee. Staff authority: positions with some authority that have been created to support, assist, and advise those holding line authority.

Machine organization

Made up of mass production/ service, government, safety business - big/ mature organisations • Ex; airlines, prison,... • Efficiency and internal control through being simple/ repetitive. No surprises! • Administrative machines (bureaucracy)/ production machines • A simple and stable environment • Strategy = strategic programming, ec. of scale, cost leadership efficiency (TQM) • Culture = obsessed with control and efficiency, no surprises, risk adverse, conservative, umbrella (management determines the search direction and coordinates the staff) • Structural dimensions = high formalization/ specialization, standardization of processes, centralization, with often functional groupings, big administration, a hierarchy of authority many layers - Problems = lack of personal freedom, lack of client focus, aversity to risks, a hierarchy overwhelmed by solving conflicts. Productivity > strategy

Organizing

Management function that involves arranging and structuring work to accomplish the organization's goals. Organizing is: - Division of labour/differentiation: breaking the task into a number of simpler tasks and assigning these tasks to specific jobs, departments and levels - Coordination: making different specialists/departments/levels work together to fulfill desired goals in an organization

Are ethical standards universal?

NO: social and cultural differences determine acceptable behaviors.

A firm's resources

Organization's assets that are used to developed, manufacture, and deliver products. - Physical capital resources: machinery, location of the firm... - Human capital resources: training, experience, relationships, insight of managers, knowhow... - Organizational capital resources: organization design, culture, reporting, planning...

A firm's capabilities

Organization's skills and abilities in doing the work activities needed in this business. Resources must work together to create capabilities. - Distinctive competence: characteristic of a business that it does better than its competitors - Core competence: major value creating capability that determines its competitive values

Why strategic management?

Strategy/planning is one of the 4 functions of management (planning, leading, controlling, organizing) It is: • Decision support, guides decisions • Coordinating device, communication easier • A target, motivational tool

Models for managing change

Practical model: based on 2 famous change models Kanter: Ten commandments for executing change & John Kotter. It happens in 7 steps (first 3= preparation, next 4 = implementation) 1. Understand: assess the need for change and define the change and risks 2. Enlist- create a powerful guiding coalition: create changing structures assign change agents (= someone who acts as a catalyst and assumes the responsibility for managing the change process) - Survey feedback activities/ change readiness - Change readiness assessment - Stakeholder mapping how much of which stakeholder is there (resister, bystanders, helpers, champions) - Force Field analysis: JIT system (driving=positive vs. restraining forces=obstacles) 3. Create a vision: picture of a better future that is easy to communicate developed by the guiding coalition 4. Motivate/sense of urgency: drive people out of their comfort zone (something goes wrong) 5. Communicate: people must believe that change is useful and possible, gain understanding and support: EXPLAIN! "Walk the talk" 6. Act/execute: get rid of obstacles to change/change the systems that undermine vision 7. Consolidate: do not declare victory too soon, new behaviors must be rooted in norms and values

Six sigma

Quality program designed to reduce defects, lower costs, save time and improve customer satisfaction. (p. 611)

SID (strategic issue diagnosis)

SID (strategic issue diagnosis) for analyzing threat/opportunity and influence on strategic decisions - Threat (- trend in ei) label: attention on internal actions greater risk will be taken in response to threat than opportunity (loss aversion) - Opportunity (+ trend in ei) label: attention on external actions less risk will be taken (except turbulent env)

Entrepreneurial (simple) organization:

Small organization run firmly and personally by one leader. • Ex. start up, innovative, local produces but also existing firms with strong leaders • Survival is key = things must be done • Coordination mechanism: one leader with direct supervision • Strategy = made to meet the boss' vision, flexible, often client focused • Culture= informal, flexible, results/ goal oriented, client focused • Structural dimensions = 'non structure', centralization (the boss has all the information!), direct supervision Problems = continuity e.g. when the firm grows, when there is an overdependence on the founder and personal status culture of the boss

Leader

Someone who can influence others and has managerial authority

Goal Setting theory, Edwin Locke:

Specific goals increase performance and difficult goals (when accepted) result in higher performance than do easy goals. Things that can influence goal-performance relationship ? Participation in setting goals; can and cannot be extra motivating, depends. + Self-generated Feedback: proven to be an even bigger motivator than external feedback + Goal commitment: the higher the better, higher when: public, internal locus of control, self-set goals. + Self-efficacy: the higher the more you believe in your ability to succeed (good in hard situ) + National culture: ideal is o Low power distance o High risk taking o High assertiveness - Productivity ↗ but job satisfaction?

Evidence-based management

Systematic use of the best available evidence to improve management practice.

Corporate strategy

The Boston Consulting Matrix: a strategy tool that guides resource allocation decisions on the basis of market share and growth rate of a strategic business unit • Star: high market share/high anticipated growth rate • Cash cows: high market share/low anticipated growth rate • Question marks: low market share/high anticipated growth rate • Dogs: low market share/low anticipated growth rate Business level (Porter) Blue Ocean Strategy/ Value innovation

Ethnocentrism

The belief that ones native country, culture, language and habits are superior to all others. Can be dealt with through education, cross-cultural awareness, international experience, humility etc.

Dynamic capabilities

The capabilities to continuously upgrade, create, extent and protect. To quickly 'reconfigure' competences/ capabilities to address rapidly changing environments innovation It is for sustaining competitive advantage over time and especially in rapid changing environments Dynamic capability is capacity to: 1. Sensing and shaping opportunities 2. Seizing opportinities/ mobilization of your resources 3. Continued renewal, transforming your businessµ

Ethics

The code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong

Centralization

The degree to which decision making is concentrated at upper levels in the organization. Top level make all decisions and lower level managers just carry out.

Decentralization:

The degree to which lower-level employees provide input or make decisions o Vertical decentralization: organizations in which decision making is pushed down to lower level managers who are closest to the action o Horizontal decentralization: power is dispersed out of the line of hierarchy and given to rather non-managers such as analysts, support specialists and teams

Human Resources

The design and application of formal systems to ensure the effective and efficient use of human talent

Resources Based View (Barney)

The firm is essentially a pool of resources and capabilities. These resources and capabilities are the primary determinants of its strategy and performance, not the markets (industry) they serve. - Resource heterogeneity: "resources" within a company (People, capital, knowledge, skills, etc.) differ between companies and hence, are determinants for performance and hence for strategy, not the industry Internal factors - Resource immobility: not all resources can be bought or copied Based on these resources and capabilities a company can build a sustainable competitive advantage

Organizational structure

The formal arrangement of jobs within an organization. The key elements/structural dimensions of organizational design (creating or changing a company's organizational structure)

Path-Goal Model

The leader's job is to assist his or her followers in attaining their goals and to provide direction or support to ensure their goals are compatible with organisational goals. > Whether a leadership style is motivating is contingent on the subordinates' characteristics and the task • Directive leader: giving direction, structure, commanding • Supportive leader: people oriented, showing concern, friendly • Participative leader: empowerment, participating in decision making • Achievement oriented leader: setting BHAGs (Big Hairy Audacious Goal = a strategic business statement similar to a vision statement)

Leaders-Followers approach > leader-member exchange theory (LMX):

The leadership theory that says leaders create in-groups and out-groups and those in the in-group will have higher performance ratings, less turnover, and greater job satisfaction > Leaders treat In-group differently (In group: close to leader in attitude or personality, have more of the leader's attention) You can improve your leadership behavior paying attention that you do treat your followers equally and develop special relations (in-group relations) with all subordinates

The Basic Parts of the Organization, division of labor (mintzberg)

The operating core includes all those employees who themselves produce the basic products and services of the organization, or directly support their production. • The strategic apex consists of the top general managers of the organization, and their personal staff. • The middle line comprises those managers who sit in a direct line of formal authority between the people of the strategic apex and of the operating core. • The technostructure consists of those analysts, out of the formal "line" structure, who apply analytic techniques to the design and maintenance of the structure and to the adaptation of die organization to its environment (e.g., accountants, work schedulers, long-range planners). • The support staff includes those groups that provide indirect support to the rest of the organization (e.g., in the typical manufacttuing firm, legal counsel, public relations, payroU, cafeteria). • Ideology: representing a pull toward a sense of mission • External Coalition: employee associations, suppliers, clients, partners, competitors, all kinds of publics, governments, interest groups ..

Strategy

The plans for how the organization will do what it's in business to do, how it will compete successfully and, how it will attract and satisfy its customers in order to achieve goals. >> It's a "theory" on how to compete successfully

Internal environment/organizational culture

The shared values, principles, traditions, and ways of doing things that influence the way organizational members act and that distinguish the organization from others. >> code of conduct, glue that holds together, "how things get done around here".

Motivating by job design:

The way in which employees can be internally motivated by changing their Jobs/ work environment. o Internal motivation? Sum of three "psychological states": meaningfulness, responsibility & results

Expectancy theory:

Theory that an individual tends to act in a certain way based on the expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual o Expectancy (effort-performance linkage): perceived probability (0-1) that an individual's effort will result in a certain level of performance, seen positive by the performance appraisal. o Instrumentality (performance-reward linkage): the perception that a particular level of performance will result in the attaining a desired outcome (reward). o Valence (rewards-personal goals linkage): the attractiveness/importance of the performance reward (outcome) to the individual. - Does the company know what employees value? Effort and performance: people must be able.

The Job Characteristics Model

This model is better than the others. Jobs are described in terms of five core dimensions: 1. Skill variety: perform a variety of different activities and can use various skills 2. Task identity: complete a whole and identifiable piece of work 3. Task significance: impact on the lives of other people 4. Autonomy: discretion in use of time and procedures 5. Feedback: receiving direct clear information about how a person has done and performed >> Computing a Motivating Potential Score (MPS) > Job Diagnostic Survey: calculates motivating potential of a job

TQM

Total quality management is an integrative philosophy of management for continuously improving the quality of products and processes. TQM functions on the premise that the quality of the products and processes is the responsibility of everyone who is involved with the creation or consumption of the products or services offered by the organization. In other words, TQM capitalizes on the involvement of management, workforce, suppliers, and even customers, in order to meet or exceed customer expectations. The culture of the company should aim at developing employees ability to work together to improve quality. !! Intense focus on the customer, concern for continual improvement, process focussed, improvement in the quality of everything the organization does, accurate measurement, empowerment of employees!!

Triple borrom line (3BL, TBL)

Triple bottom line: people, planet & prosperity (J. Elkinton). Can be measured by AAA1000 standard. BOP Bottom Of Pyramid, the poorest social-economic group (People & prosperity)

Leadership vs. management

Use of authority inherent in designated formal rank to obtain compliance from organizational member Leadership • About coping with change • Establish direction with a vision • Align resources and inspire workers to complete the vision • Leadership is doing the right things (effective) Management • About coping with complexity • Brings about order and consistency • Draws up plans, structures, and monitors results • Management is doing the things right (efficient)

The external environment

Views organisations as open systems, focuses on inputs and outputs and is used for strategizing (= less uncertainity) and is a contingency factor (onvoorziene factor) a. General environment: (DeSTEP) - demographic (baby boomers, gen X, gen Y) - socio-cultural, technological - economic - political/legal - global conditions that may affect the organization b. Task environment: external forces that have a direct and immediate impact on the organization (competitors, suppliers, customers & public pressure groups)

Selective attention/perception

We see most salient things, dearnborn studies

Strategic management process

What managers do to develop the organization's strategies • Indentify: current goals, strategies, mission (statement of its purpose) • SWOT analysis (A Humphrey) o Internal analysis: - Strengths: activity o does well or unique resources - Weaknesses: activity o does not do well or resources it needs but doesn't possess o External analysis: - Opportunities - Threats • Formulate strategies • Implement strategies • Evaluate results

Women and leadership

Women tend to adopt a more democratic or participative style unless in a male-dominated job. o Encourage participation, share information, enhance followers' self worth o Women tend to use transformational and charismatic leadership • Use their interpersonal skills o Men tend to use transactional leadership o Use a directive control and command style, rely on their formal position

Predictions Gen Z

Work - Extremely technological savvy and driven - Entrepreneurial, creative and persuasive - Intrinsic motivated - Prefer face-to-face communication? Values - Cosmopolitan - "Being digital is in their DNA" Past - Grew up during a crisis but have been pampered! - Technology e.g. smartphones at 7 years old New diversity - Salary: important for all generations (Fair) - Car: important status motivator for older generations - Training and formation: not that important for Generation Y o Generation y: Formation must be personally useful and broad o Older generation: "Formation must enable you doing your job" - Generation Y: feedback, relatively important and must be positive o However, a boss must be able to deal with negative feed back >>"Generation Z is Generation Y on steroids!!!"

Ways to design motivating jobs:

a. Job Rotation: the periodic shifting of an employee from one task to another at same level of skills b. Job Enlargement: Increasing the number and variety of tasks (job scope) c. Job Enrichment (vertical expansion): increasing the degree to which the worker controls the planning, execution and evaluation of the work (job debth) Ex: flextime, Job Sharing, Telecommuting,...

Contextual dimensions/contingency factors

a. Size: number of employees, turnover,... o Big: centralization, formalization, top down, many layers, specialization, control, standardization, .. o Small: flexible, (de)centralization (vertical & horizontal), delayering, mutual agreement, less formalization, less specialization b. Environment - rule of thumb: stable/dynamic or simple/complex c. Strategy o Innovation - Differentiation strategy (see high uncertainty) o Production - Low cost strategy (see low uncertainty) ! Holistic view: the organization sets the context for strategy. Vs. Chandler's view: Organization = means through which strategy is realized

Authentic leadership

o Authentic leaders know who they are (self-awareness), what they believe in and value, and act on those values openly o They have a sense for purpose, have an internalized moral perspective o Followers see them as ethical o Authentic leaders use ethical means to get followers to achieve their goals, and the goals themselves are ethical o Do not abuse power or use improper means to attain goals, they have self-discipline o They create trust and communicate openly, they relate to their followers and soften the boundary around them as leader, they are willingly to help others o It is something that develops over time

What leads to: high Performance work practices?

o Empowering people o Improving knowledge o Improving motivation o Enhancing retention of quality employees (and encouraging low performance to leave) => Reducing loafing - Ex, HPWP: Self-managed teams, Flexible job assignment, Decentralised decision making, Open communication, Performance based compensation , Training programmes to develop knowledge, skills and abilities

Characteristics More decentralization

o Environment is complex, uncertain o Lower-level managers are capable and experienced at making decisions o Lower-level managers want a voice in decisions o Corporate culture is open allowing managers to have a say in what happens o Company is geographically dispersed o Effective implementation of company strategies depends on managers having involvement and flexibility to make decisions

Characteristics more centralisation

o Environment is stable o Lower-level managers are not as capable or experienced at making decisions as upper-level managers o Lower-level managers do not want to have a say in decisions o Organization is facing a crisis or the risk of company failure o Company is large o Effective implementation of company strategies depends on managers retaining say over what happens

Motivation definition

the processes that accounts for an individual's intensity, direction, and persistence of effort toward attaining an organizational goal o Direction - efforts are channeled toward organizational goals o Intensity - the amount of effort put forth to meet the goal o Persistence - how long the effort is maintained

Mintzberg configurations

• A limited number of configurations can explain what happens in organisations • It depends on key organisational parts of the organisation and coordination mechanism (e.g. direct supervision, standardization of processes/ output/ input...)

A business model will clearly state

• Commercialisation strategy Exploitation • How the company gives value to the customers: - Who to serve - What do customers want and how - How does the company organise itself to meet these needs - How the company entices customers to pay for value: - How to make money/ revenue - How to convert this money into profit

Organic organization: highly adaptive & flexible

• Cross-functional teams • Cross-hierarchical teams • Free flow of information • Wide spans of control • Decentralization • Low formalization

Typologies of culture:

• Quinn & Cameron, based on competing values (OCAI test) • Deal & Kennedy typology. (Speed of feedback/reward and Level of risk)

7 traits of Kirckpatrick & Locke (1991)

• Drive. Leaders exhibit a high effort level. They have a relatively high desire for achievement, they are ambitious, they have a lot of energy, they are tirelessly persistent in their activities, and they show initiative. • Desire to lead. Leaders have a strong desire to influence and lead others. They demonstrate the willingness to take responsibility. • Honesty and integrity. Leaders build trusting relationships with followers by being truthful or nondeceitful and by showing high consistency between word and deed. • Self-confidence. Followers look to leaders for an absence of self-doubt. Leaders, therefore, need to show self-con_dence in order to convince followers of the rightness of their goals and decisions. • Intelligence. Leaders need to be intelligent enough to gather, synthesize, and interpret large amounts of information, and they need to be able to create visions, solve problems, and make correct decisions. • Job-relevant knowledge. Effective leaders have a high degree of knowledge about the company, industry, and technical matters. In-depth knowledge allows leaders to make well-informed decisions and to understand the implications of those decisions. • Extraversion. Leaders are energetic, lively people. They are sociable, assertive, and rarely silent or withdrawn. • Proneness to guilt. Guilt proneness is positively related to leadership effectiveness because it produces a strong sense of responsibility for others.

Environmental Factors Affecting HRM

• Employee labour unions - collective bargaining agreement • Governmental laws and regulations - limit managerial discretion in hiring/ promoting/ firing employees, safety, discrimination etc. • Economy's effect - life time employment, increase of unemployment rate, 0 hour contracts • Demographic trends - 'generations of workforce'

Why is HRM important?

• Employees are viewed as assets (human and social capital) • Employees can provide a competitive advantage • How organisations treat people influences performance

Mechanistic organization: rigid & tightly controlled

• High specialization • Rigid departmentalization • Clear chain of command • Narrow spans of control • Centralization • High formalisation

How managers can improve ethical behavior in an organization:

• Hire individuals with high ethical standards • Establish codes of ethics and decision rules • Lead by example (ethical culture) • Set realistic job goals and include ethics in performance appraisal (systems and structures) • Provide ethics training • Conduct independent social audits • Provide support for individuals facing ethical dilemmas such as whistle blowers (individual who raises ethical concerns or issues to others)

Communication tips

• Honest, realistic: For everyone same information/adapted to respective publics • Systematic: Direct dialogue with the basis (their bosses) • Continuous and repetitive: Short - to the point

1) DIVISION OF LABOR OR DIFFERENTIATION

• Horizontal differentiation (departmentalization/specialization): • Vertical differentiation/ lines of authority (= the rights inherent in a managerial position to tell people what to do an to expect them to do it)

The big V theory of the 1980's

• Leaders are extravert (r = .22) • Leaders are conscientious (r = .20) • Leaders are open to new experiences (r = .16) • Agreeableness (r = .02) and emotional (un)stability

Professional organisation

• Made up of liberal professions, law firms, engineering firms, R&D departments, hospitals, mainstream consultancies, universities • They offer highly skilled and stable services within a complex and stable environment • Strategy = lacks being well-formulated coherent, made by committees, lack of customer • focus, not clear • Structural dimension = standardization by input, decentralization, a lack of control and formal rules (especially professional bureaucracy), pigeonholing (categorizing) • Ideology = fine line between collegiality and self-interest

Historical background, early management 3000BC-1776

• Management has always existed, think building pyramids (counting stones, everyone job,...) • In 1776, however Adam Smith (the wealth of nations) argued advantages companies would get from division of labor/job specialization (ex. Pin industry) • Late 18th century, industrial revolution, machine power substituted for human labor. There was a need for management, because there were a lot of large organizations. Only in late 1900s the first steps to developing scientific theories were taken.

Organizational designs: (decided by organization assessment tool)

• Mechanistic organization: rigid & tightly controlled • Organic organization: highly adaptive & flexible The means organizations have at their command to design structures: what we call the design parameters. These can then be analyzed in terms of the contingency factors that influence their choice. >> The Basic Parts of the Organization

Intercultural differences

• National culture influences how people behave and influences organisational culture • If you are born in that culture you are 'totally immersed' • Values, religion, ethics, issues, communication etc

Mintzbergs rules about organization structures

• Older organisation = more formalised behaviour • Larger organisation = more elaborate structure, more formalised behaviour • Structure = 'the age of industry', favours structure of the day (even if inappropriate) • More dynamic environment = more organic structure • More hostile environment= organisation centralises

Role of EQ

• Self-awareness- the ability to read one's emotions and recognize their impact while using gut feelings to guide decisions. • Self-management - involves controlling one's emotions and impulses and adapting to changing circumstances. • Social awareness and Empathy - the ability to sense, understand, and react to others' emotions while comprehending social networks. • Relationship management - the ability to inspire, influence, and develop others while managing conflict. - No universal traits found that predict leadership in all situations - Unclear evidence of the cause and effect of relationship of leadership and traits - Haloo effect (ILT): we rather have mental representations of traits, we tend to perceive that someone is a leader when he/ she has these traits + Traits theory gives direction regarding which traits are good to have

Adhocracy or innovative organisation

• Sophisticated innovation, entrepreneurship, 'chaos', mixed expertise working together • Creative industry, innovative consultants, manufacturer of complex prototypes, high technology, networks • Great for innovation and flexibility as well as adjusting to the environment with a coordination mechanism based on mutual agreement within mixed teams • Strategy = innovation, bottom up process • Structural dimension: horizontal centralisation, coordination by agreement, matrix structure, little formalization/ specialization, low control • Culture = Entrepreneurship, strong innovation, freedom, inefficiency tolerated

Path-Goal model is influenced by

• Tasks are clear and/or clear formal authority system: - directive style, + supportive style • Workgroup conflict: + directive style • High internal locus of control + participative style • High experience and high perceived ability: - directive style, + achievement style

Mistakes that are often made when making a decision:

• The rush-to-judgement blunder (no time = stress) o Bad/ no problem definition, bad alternatives, no goal definition o Limited research for alternatives to a manager's preconceived ideas • Misuse of resources • Failing to learn from mistakes by not acknowledging them • Ignoring ethical questions • Bargaining

The design parameters, mechanisms organizations can use to make coordination, division of labor

• job specialization, • behavior formalization • training and indoctrination, • unit grouping, • unit size, • action planning and performance control systems • liaison devices (such as integrating managers, teams, task forces, and matrix structure) • vertical decentralization (delegation to line managers) • horizontal decentralization (power sharing by non-managers)

Integrating motivation theories:

◊ Money is not everything ◊ You need to know what motivates people o People are motivated when they can identify personal goals with the organizational goals o Listen to your employees ◊ Make goals specific and difficult ◊ Motivation can be increased by raising employee confidence in their own abilities (self-efficacy) ◊ Be aware of the Pygmalion effect: higher expectations lead to an increase in performance ◊ Pay attention to employees' perceptions of what is fair and equitable; explain decisions about promotion and pay ◊ You get behaviors that you expect and reinforce

The universality of management

In all organizations, managers must plan, organize, lead, and control. However, it can be done in different ways. Size, type, area & level: don't matter.

Keeping a culture alive

• Seek out those who fit in through hiring and firing • Formal socialization (written values, training ,...) • Informal socialization (stories - provide explanations/legitemacy, top management examples/ leadership styles, performance evaluation, rewards, material symbols, rituals,...) • Structure

Types of managers

(A) Vertical 1. Top: making organization wide decisions and establishing the goals and plans that affect the entire organization = CEO, COO, VP, P... (POC) 2. Middle: manage the work of FL-manager = division m, store m, project leader... (OCLP) 3. First-Line: manage work of NM workers = shift m, department m, district m... (LCOP) 4. Non-Managerial: no managerial function, but the distinction is quite blurred nowadays. They work directly on a job or task and have no one reporting to them. (B) Horizontal 1. Functional: responsible for departments that perform specific tasks. 2. General: responsible for several departments or entire organization. > Managers work in an organization: deliberate arrangement of people to accomplish some specific purpose, which individuals independently couldn't accomplish alone.

Dysfunctional aspects of a strong culture:

- Barriers to change: culture is slow to change even in dynamic environments. - Barriers to diversity: managers want employees that accept the values of the firm but also but added pressure on to conform. - Barriers to acquisitions and mergers: most fail due to cultural incompatibility.

Management innovation

- Centralised management structure will seem most antiquated ... - People will chuckle at the concept that a very small group of individuals who are the most removed from the actual work, sequestered in a conference room can, in isolation envision the future course which will be accepted and embraced by the entire organization - Rigid organization structures/designs - Restricted, controlled flow of information shall be the most antiquated feature - Shareholder Value Fundamentalism [will appear anachronistic in the future]. Organizations will balance human values and not focus anymore just on economic value.

Characteristics organization

- Distinct purpose: typically expressed through goals the organization wants to accomplish. - People: takes people to achieve goals and perform the work - Deliberate structure: every organization has its own structure, can be flexible (Google)

Developing cultures

1) Innovative culture - Challenge and involvement - Freedom, trust, openness, playfulness & humor. - Conflict resolution, debates, expression of opinions - Risk taking and accepting failure 2) Customer-responsive culture - Hiring the right type of employees for customer needs - Having few rigid rules, procedures and regulations - Using widespread empowerment of employees - Providing role clarity to employees to reduce ambiguity, conflict and increase job satisfaction 3) Ethical culture - Formal (ethical codes) /informal socialization (role models) - Performance appraisals/ rewards for ethical conduct - Not too high bonuses/ expectations - Encourage whistle blowers

The seven dimensions of the organisational culture

1. Attention to detail 2. Outcome orientation 3. People orientation 4. Team orientation 5. Aggressiveness 6. Stability 7. Innovation and risk taking

Changes managers face and some impacts of change

1. Changing technology, digitalization > social media, virtual workplace 2. Increased emphasis on organizational and managerial ethics > sustainability, increased accountability 3. Increased competitiveness > innovation, globalization, efficiency/productivity, customer service 4. Changing security threats > risk management, employee assistance, globalization concerns

Quinn model 2 - values

1. Clan orientated culture: family-like, with focus on mentoring, nurturing and "doing things together" 2. Adhocracy oriented culture: dynamic and entrepreneurial, with focus on people, risk-taking, innovation and "doing things right" 3. Market oriented culture: result-oriented, inter with focus on competition, achievements and "getting the job done" 4. Hierarchy oriented culture: structured and controlled, with a focus on efficiency, stability and "doing things right"

Management is...

1. Coordinating/overseeing the work activities of others so their activities are completed. 2. The attainment of organizational goals in an effective and efficient manner (POLC resources) through working with others in a changing environment. - Efficient (means): doing things right to achieve the goals set by the company with lowest waste possible for most output. - Effective (ends): doing the right things, highest goal attainment >> Management is important; 58% success company determined by it.

Scientific management

1. Frederick W. Taylor's Principles of Scientific Management. Taylor made 4 principles that would lead to highest efficiency, he did this through scientific studies of the tasks (time and motion) = standardization of processes a. Replace rule-of-thumb work methods with methods based on a scientific study of the tasks (Time and motion study) - (Specialization, horizontal differentiation) b. Scientifically select, train, and develop each employee rather than passively leaving them to train themselves. c. Provide "Detailed instruction and direct supervision (control) of each worker in the performance of that worker's discrete task" (standardization/formalization of methods/processes, vertical differentiation lines of authority) d. Divide work nearly equally between managers and workers so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks (Separation of thinking and doing, centralization) see ppt pg 7 > In other words, it is the fact to increase productivity by putting the right person on the job with the correct tools and equipment, having the worker follow his instructions exactly, and motivating the worker with an economic incentive and high daily wage. 2. Frank & Lillian Gilberth, inspired by Taylor. Wanted to eliminate inefficient hand-and-body motions and experimented with design and use of proper tools & equipment. They conducted bricklaying experiments to analyse motions. They invented a microchronometer which recorded every motion and time to complete a task (time-and-motion study). They also invented the therbligs a classification scheme for labeling basic hand motions. >> Nowadays: many of Taylor and Gilbreth techniques are still used in organizations today. Most managers today use time-and-motions study to eliminate wasted motions, hire best-qualified workers for a job

General administrative theory

1. Henri Fayol identified 5 functions that managers perform; planning, organizing, commending, coordinating & controlling. Developed 14 principles of management: fundamental rules of management that could be applied in all organizational situations and thought in schools. a. Division of work (employee efficiency, specialization) b. Authority (give orders, balanced with responsibility) c. Discipline (obedience) d. Order: a place for everyone and everyone in his place (everyone/thing place & time) e. Unity of command (everyone receives orders from olnly 1 superior) f. Unity of direction (1 plan of action for all managers & workers g. Subordination of individual interests to the general interests h. Centralisation (degree in which subordinates are involved in decisions) i. Scalar chain (line of authority from top to lowest rank and horizontal linkages) j. Remuneration is a means (fair wage) k. Equity (managers fair to subordinates) l. Stability of tenure of personnel (managers should provide orderly personnel planning) m. Initiative (Employees allowed to originate and carry out plans) n. L'Esprit de corps 2. Max Weber developed an ideal type of organization bureaucracy; an organization characterized by division of labor, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationships. (is a lot like scientific management) his aim was to stop nepotism/corruption. - Division of labor: jobs broken down into simple, routine, and well-defined tasks - Authority hierarchy: positions organized in a hierarchy with a clear chain of command - Formal selection: people for jobs based on technical qualifications - Formal rules & regulations: system of written rules and standard operating procedures - Impersonality: uniform application of rules and controls, not according to personalities - Career orientation: managers are career professionals, not owners of units they manage > Downfalls classical approach: humans=machines, not flexible, empire building/games, not client oriented,.. >> Nowadays: several of our current management ideas can be directly be traced to the contribution of general administrative theory. Ex: 14 principles serve as a frame of reference from which many current management concepts evolved.

Quinn model 1 - means

1. Human Relations model: family firms Values: teamwork, participation, attention to employees concerns > cohesion and morale (with emphasis on human resource and training) 2. Open Systems model: Google Values: adaption, creativity, innovation, client centricity, decentralization > flexibility and readiness 3. Rational Goal model: P&G, Unilever Values: outcome, excellence, goal attainment, market share, "the best" > goal setting, planning, evaluation 4. Internal Processes model: Ford Values: stability, order, predictable > information management, control

Three reasons why managers are important

1. Organizations need their managerial skills and abilities: in uncertain, complex and chaotic times and in today's challenges (changing technology, changing workforce dynamics and ever increasing globalization) e.g. LVHM (luxury company), you probably think you will only find talented and creative innovators like Karl Lagerfeld, but it takes more than that to beat your competitors. There has to be a lot of focus on commercial potential. Managers ask themselves "is this marketable?" 2. Critical to getting things done: they deal with all kinds of issues. If the work I not getting done as it should be, they're the ones who find out why and put things back on track. They're key players in leading the company into the future. 3. Managers do matter to organizations: quality of the relationship between employees that matter. Sometimes, the fact that company engages this type of person can affect the financial performance. > Managers do have an impact, whether it's negative or positive

Behavioral approach/humanistic perspective

1700-1950; researches the actions/behavior of people at work organizational behaviour (OB)

What is Social responsibility

A company's intention, beyond it's legal and economic obligations to do the right things and act in ways that's good for society.

Business ethics

A form of applied ethics that examines ethical principles or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and business organizations as a whole. Knows many applications: o Accounting: insider trading, executive compensation, facilitation payments, etc. o Human resource management: discrimination, sexual harassment, drug testing, privacy issues, slavery, safety, etc. o Production: emission, tobacco, modified food, testing on animals, etc. o Sales and marketing: skimming, price discrimination, sex in commercials, misleading commercials, defectuous/dangerous goods etc.

Stakeholder theory/approach

A stakeholder in an organization is (by definition) any group or individual who can affect or is affected by the achievement of the organization's objectives. Ex; unions, social/political action groups, communities, competitors & media You have to decide how critical each stakeholder is and how you're gonna handle them. Every one is different (ex. Employee= job security/rates of pay/respect,...) A shareholder owns part of a company through stock ownership, while a stakeholder is interested in the performance of a company for reasons other than just stock appreciation. Classification of stakeholders, salience model Mitchell Agle: (helps to classificate stake holder

Systems approach: 1+1 = 3

A system: a set of interrelated and interdependent parts arranged in a manner that produces a unified whole. Closed and open systems, nowadays only open: dynamically interact to their environments by taking in inputs and transforming them into outputs that are distributed into their environments. - Coordination is key - actions/decisions in one area will have consequences in another 1+1=3 - parts must work together - organisation must adapt to surroundings (marketing)

Ethical problem/ethical dilemma

Actions/decisions of one person/organization will disadvantage others.

Escalation of commitment

An increased commitment to a previous decision despite evidence it may have been wrong (Challenger)

Corporate governance (p. 577)

An internal system encompassing policies, processes and people, which serves the needs of shareholders and other stakeholders, by directing and controlling management activities with good business savvy, objectivity, accountability and integrity. Used to be agency theory (shareholders) now serving stakeholders is more important Social CG CG= to make better decisions, the Ethical code: a formal statement of an organization's primary values and the ethical rules it expects its employees to follow. >>Values basic convictions about what is right/wrong Business ethics: a form of applied ethics that examines ethical principles or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and business organizations as a whole

OCAI: Organizational Culture Assessment Instrument

Based on the assessment of six criteria; 1. Dominant organizational characteristics: a personal place like a family or competitive/ achievement oriented. 2. Leadership style: mentoring, facilitating or nurturing, or no-nonsense, aggressive 3. Management or employees: teamwork, consensus and participation or freedom and uniqueness 4. Organisational glue: loyalty and mutual trust or procedures 5. Strategic emphasis: human development or competitive actions and winning 6. Criteria for success: development of HR, teamwork and concern for people or having the most unique and newest products and services

What is a decision?

Choices made from among alternatives developed from data perceived as relevant >> Perception of the decision maker influences the outcome

Anchoring or focalism:

Cognitive bias that describes the common human tendency to rely too heavily, or "anchor," on one trait or piece of information when making decisions.

Attribution theory

Cognitive explanations about why do people act as they act based on our judgments of a person and their actions. Attribution influences decision making. • Internal attribution : behavior is believed to be under the personal control of the individual • External attribution: the person is forced into the behavior by outside events/causes We determine this based on: distinctiveness, consensus & consistency • Attribution bias (pg 478) - Fundamental attribution error: tendency to underestimate the influence of external factors and overestimate that of internal factors when judging others. - Toward yourself: self-serving bias: taking quick credit for successes and blaming outside factors for failures. Interpreting ambiguous information in your favor. - Other shortcuts in judging others o halo effect: a general assumption of a person based on a single characteristic o contrast effect: how others scored changes how u see results other people o stereotyping: judging a person based on perception of a group to which that person belongs o self-fulfilling prophecy, Pygmalion effect: high expectancy of soldiers increases performance o Assumed similarity: the assumption that others are like oneself

For effectiveness

Competing value approach of Quinn & Rohrbaugh. 2 models: 1. A spatial model of effectiveness criteria: towards a competing value approach to organizational analysis, structure (means) 2. Diagnosing and changing organizational culture (values)

Decision making styles

Creativity: the ability to produce novel and useful ideas >> Key is making associations Between unconnected Events, ideas, objects, Information in memory,... 1. Analytical - long term, more alternatives, more flexible 2. Conceptual - broad perspective, many alternatives, intuition, indecisive 3. Behavioural - love people, interaction, avoid conflict, wishy washy solution 4. Directive - autocratic, short term, closely analyse

Human resources perspective (revisionism)

Dairy approach = too narrow, how do you unlock human potential, what are needs/motivation, training? Theory X vs. theory Y Douglas McGregor

How do managers make decisions?

Decisions are made based on the content: - Structured problems; straightforward, familiar, and easily defined content. They will result in a programmed decision; a repetitive decision that can be handled by a routine. ↔ or unstructured; new or unusual and for which info is ambiguous or incomplete. These will require custom-made solutions. And will result in non-programmed decisions= unique, nonrecurring and generate unique responses. - Strategic; apply to entire organization and establish oranization's overall goals ↔ or operational; encompass a particular operational area of the organization Decisions are also based on the context: - Urgency, threat, opportunity... - Organisational characteristics; o Culture, structure, reward systems, past decisions,... - Decision makers' attributes; o Propensity to risk, tolerance for ambiguity, decision style, experience,...

The ethical manager

Do ethical codes matter? YES no ethical codes often lead to: o Prevention of scandals!! => bankruptcy! REPUTATION! o Often self enrichment (Top management) o Often aggressive corporate culture of profit o Bonus - promotion o No whistle blowers

The external environment is important for calculating:

Environmental (Un)Certainty: the extend to which managers have knowledge of and are able to predict change in their organisations external environment. It is affected by: ! The complexity of the environment: the number of components in an organization's environment and the extent of the organization's knowledge about those components (simple or complex). ! The degree of change in environmental components; dynamic: the components in an organization's environment change frequently change has to be predictable ex. recorded music or stable; if the component in an organization's environment change is minimal ex: zippo)

Decision-making in groups/ teams

Ex; juries in court, top management teams, team assignments Advantages: + Generates more complete information and knowledge + Increases diversity of views (=creativity?) and acceptance of a solution Disadvantages - Time consuming - Groupthink: a deterioration of individual's mental efficiency, reality testing, and moral judgments as a result of o Conformity, (Asch), group pressure o Self-censorship: doubters keep silent o Groupshift/risky shift; more risks more extreme positions "illusion to invulnerability" o Unethical decisions

Our task environment consists of which different environments?

External environment and Internal environment/organisational culture

Classical approaches:

First studies of management, which emphasized rationality and making organizations/workers as efficient as possible: (A) Scientific management - using scientific methods to find best way (B) General administrative theory - describes what managers to and what constitutes good management practice

Hawthorne experiments

First with light intensity and how it influenced productivity. In 1927 Elton Mayo joins study and does numerous experiments. This way they conclude that an incentive plan has less result on and worker's output than group pressure, acceptance and security. So social norms or group standards were the key determinants of individual work behavior. >> Nowadays: from the way managers design jobs, the way they work with employees, the way they communicate, we see elements of the behavioural approach.

The management of Google

Founded by Larry Page (CEO) and Sergei Brin in 1998 and included a search engine, apps, maps, gmail etc. It was quoted on the stock exchange in 2004 and in 2010 had over 23000 international employees. Super flat, decentralized chaotic network; • Self managed teams (3/4 persons) • Supervision = peer discussion • A free choice of projects with decision based on consensus • Horizontal communication (networks within the organisation e.g. blogs, intranet etc). • Innovation; o 70/20/10 rule o High pay o Hobby time (20%, Googlettes) o "Just try - cut your losses" culture o Mission; Organise the worlds information and make it universally accessible and useful

Current marketing trends

Globalization, outsourcing, climate change, crisis, diversity, Generation Y, CSR, social networking, flexible work arrangements

Decision making models

How to solve a problem; perceived discrepancy between the current state of affairs and a desired state >> Perception of the decision maker influences the outcome (I might see as problem u not)

Change a culture

If you want to CHANGE culture you have to use the star model: Different types of international organizations: 1) Multinational Corporation (MNC): a broad term that refers to any and all types of international companies that maintain operations in multiple countries. 2) Multi-domestic Corporation: is an MNC that decentralizes management and other decisions to the local country. 3) Global Company: is an MNC that centralizes its management and other decisions in the home country. 4) Transnational Corporation (Borderless Organization): is an MNC in which artificial geographic barriers are eliminated

Representativeness bias

People judge the probability or frequency of a hypothesis by considering how much the hypothesis resembles available data

Human relations Movement

People more than machines, look at individual and group behavior & if you treat people better output higher (dairy farm), Maslow

Loss aversion

People value losing higher than gaining − Framing bias: the way a question is asked influences the outcome − Endowment effect: once something is owned we value it more

Steps of rational decision making

Rational decision making: describes choices that are logical and consistent and maximize value 1) Identifying a problem: an obstacle that makes it difficult to achieve a desired goal/purpose. 2) Identifying decision criteria: criteria that define what's important or relevant to resolving a problem 3) Allocating weights to the criteria: weight the items to give them the correct priority in the decision. 4) Developing alternatives: list viable alternatives that could resolve the problem 5) Analysing alternatives: evaluate and compare alternatives 6) Select and alternative: choose the best alternative or highest total in step 5 7) Implement the alternative: use the alternative 8) Evaluate decision effectiveness: evaluate the outcome or result.

Influencing factors on the strength of a culture

Size & age, rate of employee turnover, strength of the original culture & clarity of cultural values and beliefs

What is a manager?

Someone who coordinates and oversees the work of other people so that organizational goals can be achieved = about helping others do their work

Sustainability

Sustainability/sustainable development: sustainable development is development that meets the needs of the present generations without compromising the ability of future generations to meet their needs and aspirations

Bandwagon effect

Tendency to do (or believe) things because many other people do (or believe) the same. Related to groupthink and herd behavior

Confirmation/self-serving bias:

Tendency to interpret or/and search for information in a way that confirms one's preconceptions; this is related to the concept of cognitive dissonance. (p 467) − Overconfidence bias: when you think you know more than you do

Negativity bias

Tendency to pay more attention and give more weight to negative than positive experiences or other kinds of information

Post-purchase rationalization:

Tendency to persuade oneself through rational argument that a purchase was a good value

Denomination effect:

Tendency to spend more money when it is denominated in small amounts (e.g. coins) rather than large amounts

Unified Corporate Culture

The corporate culture of an international company is uniform across borders but with deep rooted values of different people from different cultures still potentially existing. • Helps streamline employee behaviour and smoothen out managerial problems arising from cultural differences. • Is determined by the importance of maintaining uniform product offerings, leadership styles, management systems etc. • Examples; IKEA, Mcdonalds, Bodyshop...

Empowerment

The opportunity to exercise personal discretion/ choice is an important element contributing to employee engagement and wellbeing (sharing information, autonomy, self managed teams etc).

Green management

The recognition of the close link between an organization's decision and activities and its impact on the natural environment Global environmental problems nowadays: o Air, water, and soil pollution from toxic wastes o Global warming from greenhouse gas emissions o Natural resource depletion How much managers do to keep the impact of their organization on the natural environment minimal is depicted in the environmental sensitivity scale: High: Activist approach: it illustrates social responsibility (ex. Ecover) Stakeholder-approach: works to meet environmental demands of multiple stakeholders Market-approach; they respond to what the customers want environmentally Low: Legal approach: only doing what's legally required

Hindsight bias

The tendency for decision makers to falsely believe that they would have accurately predicted the outcome of an event once that outcome is known

Creating a culture

The ultimate source of an organisations culture is its founders: • They have a clear vision and are unconstrained by previous visions • They hire and keep like-minded employees • Founders act as role models, when they are successful the founders vision becomes a 'myth' • Industry and national culture play a role

Theory X&Y

Theory X: - Employees are inherently lazy and will avoid work if they can. - Employees must be coerced, controlled, directed and treated with punishment to get them to put in effort. - Employees have little ambition, wishes to avoid responsibility and security. Theory Y: - Employees do not dislike work. - Employees may be ambitious, self-motivated and exercise self control when committed. - Employees will seek responsibility under the right conditions, they are ambitious and creative. >> Theory Y: use this potential by communicating, decision sharing and creating an environment in which subordinates can develop and use their abilities

The contingency approach

There is no one universally applicable set of management principles (rules) by which to manage organizations. Organizations are individually different, face different situations (contingency variables), and require different ways of managing. 4 popular contingency variables; o Organisation size - as size increases so do the problems of coordination. o Routineness of task technology - routine technologies require organisational structures, leadership styles and control systems that differ from those required by customised/ non -routine technologies. o External environment/ environmental uncertainty - what works best in a stable/ predictable environment may be totally inappropriate in a rapidly changing and unpredictable environment. o Individual differences - they differ in terms of their desire for growth, autonomy, tolerance of ambiguity and expectations. >> McKinsey's 7-S model; 3 hard S's feasible and easy to identify: strategy, structure, systems & the 4 soft S's hardly feasible & difficult to describe: style/culture, staff, skills, shared values/superordinate goals.

Why rational decision making model and how it looks in reality?

We use this model to get highest utility, we expect to have complete knowledge on the problem and be completely unbiased. In reality we only do a limited search, we satisfice ("good enough") rather than maximize & we choose alternatives similar to those already in effect. >> So we do bounded rationality: decision making that's rational but limited (bounded) by an individual's ability to process information. We are limited in our: - Perception: a process by which individuals organize and interpret their sensory impressions in order to give meaning to their environment. Perception is influenced by; o Factors in the situation; time, work setting, social setting & culture o Factors in perceiver; attitudes, motives, interests, experience, expectations, gender & values o Factors in the target; novelty, motion, sounds, size, background, proximity, similarity. Perception influences: awareness that a problem exists, interpretation & evaluation of information, analysis & conclusion - Sense making/giving meaning: giving data a meaning and developing mental models for interpretation. People extract cues from the context to help them decide on what information is relevant and what explanations are acceptable. - Emotion; when making decisions we first use our mammals brain (responsible for; emotion, love, passion,...) and afterwards we use our neo cortex (responsible for: critical thinking & logic,..). So we need emotions to make decisions. - Biases/cognitive shortcuts; heuristics (rules of thumb that managers use to simplify decision making) or information processing shortcuts (p 86-91)

(Corporate) social responsibility CSR

What is the role of companies as a whole for society? a. Classical/minimalist view; Milton Friedman; management's responsibility is making profit This is only in the interest of shareholder b. Social economic view; business would embrace responsibility for the impact of their activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere. Even more they would pro-actively work on benefitting society. Companies have (according to carroll's CSR pyramid): o Economic, legal, ethical & philantrophic responsibilities The European commission even made a policy about it. Today CSR is themed as corporate sustainability: Integration of social, environmental, and economic concerns into an organization's culture, decision-making, strategy, and operations. They do this through: - Social impact management; considering the social context. Look at rights and responsibilities of stakeholders, make strategy based on broader impacts. - Social accounting: the process of communicating the social and environmental effects of organizations' economic actions to particular interest groups within society and to society at large (10 principle of UN Global Compact) - Social entrepreneurship: using a market-driven business model to address key social and environmental issues. They seek to improve society by using practical, innovative and sustainable approaches shoes for tomorrow

How to know more about the external environment:

a) Boundary spanning roles: functions/departments who are in touch with the environment • Information (marketing, sales,...) • Representing interests (public relations,...) b) Competitive intelligence (CI): the action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors and any aspect of the environment needed to support executives & managers in making strategic decisions.

Factors that determine ethical and unethical behavior?

a. Stage of moral development: pro conventional, conventional, post conventional b. Individual Characteristics: o Values (basic convictions about what is right or wrong) o Personality: - strength: measures the strength of a person's convictions, self discipline, taking accountability - locus of control: a personality attribute that measures the degree to which people believe they control their own life ♣ internal locus: the belief that you control your destiny ♣ External locus: belief that what happens to you is due to luck or chance c. Organizational/Structural Variables: are the goals to be attained high (people who do not reach set goals are more likely to engage in unethical behavior). Organizational characteristics and mechanisms that guide & influence individual ethics d. Organization culture; is it an ethical culture is it a strong culture? e. Intensity of the ethical dilemma: ex. Train 1 vs. 2, or push

Criteria for ethical decision making: define "good" and "wrong" based on different "philosophical schools"

a. Utilitarian approach: moral behaviors should produce the "greatest good for the greatest number" (Jeremy Bentham &John Stuart) !! Not always good: privacy issues vs. Safety in the workplace b. Moral Rights Approach: moral decisions are those that best maintains the rights of those affected (Immanuel Kant). Ex. Right to: free consent, fair trial,... c. Fairness/Justice Approach: decisions must be based on standards of equity, fairness, and impartiality. Individuals who are similar in ways relevant to a decision should be treated equal (Aristotle) No discrimination/favoritism! d. Individualism approach: acts are moral when they promote the individual's best long-term interests. Individualism is believed to ultimately lead to behavior toward others that fits standards of behavior people want toward themselves. e. The Common-Good Approach: people are part of society and common goals and values must be served (Plato, Aristoteles, Cicero) For society to thrive, we need to safeguard the sustainability of our community for the good of all, including our weakest and most vulnerable members. Ex: Publix safety, no pollution, peace, fair justice

Managerial Decisions Affected by Culture

o Planning - The degree of risks contained - Whether plans should be developed by individuals or teams - The degree of environmental scanning in which management will engage etc. o Organising - How much autonomy should be designed into employees' jobs - Should tasks be done by individuals or teams - How much do department managers interact with each other etc. o Leading - How much are managers concerned with increasing employee job satisfaction - What leadership styles are appropriate - Should disagreements (even constructive ones) be eliminated etc. o Controlling - What criteria to be emphasized in employee performance evaluations, - Should external controls be imposed or should employees be allowed to control their own actions - what repercussions will occur from exceeding a budget etc.

Early advocates of behavioural approach

o Robert Owen: -Concerned about deplorable working conditions, proposed idealistic workplace & argued that money spent improving labour was smart investment o Hugo Munsterberg: suggested to use psychological test for employees selection, studied human behaviour and how to motivate employees, pioneer in field of industrial psychology - scientific study of people at work o Mary Parker Follet: difference individual and group behavior within organization, organizations should be based on group ethic, more people oriented ideas. o Chester I. Barnard: organization=social system: people work together (cooperation), communication & stimulation= important, workers can disobey, open systems.