Exam 2 Management study guide
*Four phases:* 1) *Needs assessment*: an analysis identifying the jobs, people, and departments for which training is necessary 2) *Program design*: address objectives and content of training and development
3) *Methods and location*: classroom lecture, on-line, role-playing, simulation, job rotation, etc. -on-site, off-site 4) Evaluation: -employee reactions -learning/testing -bottom-line results
Business incubators
protected environments for new small businesses
Immediate feedback is valuable
*Positive*: private ^, public ^ *Negative*: private ^, public x (Praise in public; criticize in private)
Title VII of the Civil Rights Act of 1964
*Prohibits discrimination based on race, sex, color, religion, or national origin in employment decision*
Family and Medical leave act (1991)
*Requires 12 weeks' unpaid leave for medical or family needs: paternity, maternity, family member illness*
Four phases address the following:
*Training*: teaching lower-level or new employees how to perform their present jobs *Development*: helping managers and professional employees learn the broad skills needed for their present and future jobs.
American with Disabilities Act of 1990
*workplace modification to facilitate disabled employees; prohibits discrimination against disabled*
Advantages of delegation
- Leverages managers' energy and talent - Conserves managers' most valuable asset: time - Develops subordinates' managerial skills and knowledge - Promotes subordinates' sense of importance and commitment
Selection methods
-Applications and Resumes -Interviews -Reference Checks -Background Checks -Personality Tests -Drug Testing -Cognitive Ability Tests -Performance Tests -Integrity Tests
Delegation no-no's
-Disciplining employees -Giving performance reviews -Dealing with other sensitive or confidential issues
Situation: Representative from company A hands significant cash to project manager who works for company B. Lesson: "Integrity is a manager's (or professional) most valuable asset"
-Just bc something is legal doesn't mean that it's ethical. -Actions take in response to ethical issues or dilemmas need to consider one's reputation and entire career, not just the situation at hand.
*Planning Steps* Step 4: Select Goals and Plans Scenario planning: "bounds" the reality of planning provides an "escape hatch" or alternative ("Plan B") if the selected plan needs to be abandoned
-Managers will select the most appropriate and feasible alternative -The evaluation process identifies the priorities and trade-offs among the goals and plans.
Line management's relationship with HR department:
-Old school (unenlightened) -Current thinking
Creating a competitive advantage with human resources:
-People create value -Talent is rare -A motivated group is difficult to imitate (or replace) -People can be organized for success
Layoffs (downsizing, or right-sizing,reduction in force, or RIF" due to changing or declining business needs
-Planning/HR involvement >demographics >security/legal as appropriate >Discussion and documentation of unemployment benefits for downsized employees >Timing (day of week/time of day) >Hand vs one-at-a-time fingers >Confidentiality: before/during/after *(only HR)* >Logistics: who present, when, where, how, precautious (note: often multiple layoffs at a time) *(lay off person, yourself, HR)* >Most common reaction: male and female >Outplacement (off-site, if any): helping people who have been laid off regain employment elsewhere >Management of "survivors" *(where? that persons office -Lay off in the morning -Avoid firing ppl on a Friday -Lay off 3 ppl/do it all at one time)* *(most common reaction: male and female (crying)*
*Other methods* Reference checks
-candidate-offered references vs. other references
Cultivate internal support for your idea:
-clear the investment with your boss -find cheerleaders who will support your idea -engage in horse trading for support, time, monet, and other resources -get the blessing of relevant higher-level officials
Myths: entrepreneurs are gamblers (take calculated risks) -Entrepreneurs are their own bosses and completely independent (investors, customers, stakeholders)
-if an entrepreneur is talented, then success will happen quickly (rare)
Resources (internally)
-inputs to a system that can enhance performance -Tangible and intangible assets
Managerial Intrapreneurship is risky
-intrapreneurial effort can fail-hence risk -but failing to foster intrapreneurial may represent a greater risk -the most dangerous risk: overreliance upon single project
Nonfinancial resources
-legitimacy -networks/social capital - top management teams -advisory boards -partners
*Planning Steps* Step 3: Evaluate Goals and Plans
-managers will: evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan -Prioritize those goals and eliminate some of them. -Managers must consider carefully the implications of alternative plans for meeting high priority goals.
Fifth (Implement the strategy)
-organizational structure -Technology -Human resources -reward systems -information systems -organizational culture -leadership style
Entrepreneurial Success Characteristics
1) Commitment and determination 2) Leadership 3) Opportunity obsession 4) Tolerance of risk, ambiguity, and uncertainty 5) Creativity, self-reliance, and ability to adapt 6) Motivation to excel
Disadvantages of a matrix organization
1) Confusion(violation of "unit-of-command principle") 2) Conflicts 3) Slower decision-making
Why do workers join (or not joint) a union?
1) Economic factors 2) Job dissatisfaction 3) Belief that union has power to obtain desired benefits 4) Image of the union
Planning and Decision Making
1) The Planning Process 2) Levels of Planning 3) Strategic Planning Process 4) Business Strategy 5) Implement the strategy 6) Managerial Decision Making 7) Human Nature Erects Barriers to Decisions 8) Groups may make decisions
List of challenges:
1) may not like it 2) survival 3) growth 4) delegation 5) misuse of funds 6) poor controls 7) mortality 8) going public
First, Establish a mission, vision, and goals
1) mission (today): an organization's basic purpose and scope of operations 2) strategic vision (tomorrow): long-term direction and strategic intent of a organization -provides a perspective on where the organization is headed and what it can become. Goals: "verb" phrases; SMART
Advantages of Matrix Organization
1)Cross-functional problem solving leads to better-informed and more creative decisions 2)Decision making is decentralized 3)Extensive communication networks help process large amounts of info 4) Higher management levels aren't overloaded with operational decisions 5)Resource utilization is efficient
Failure to take these steps: most common source of delegation failure
1)Define the goal succincity 2)Select the person for the task 3)Solicit the subordinate's viewers about suggested approaches 4)Give the subordinate the authority, time, and resources (people, money, equipment) to perform the assignment. 5)Schedule checkpoint is for reviewing process 6)Follow through by discussing progress at appropriate intervals
Historical rule of thumb:
6 is an appropriate span of control -less than 6 is narrow -more than 6 is wide -trend to reduce the number of hierarchical layers in past few decades
Incentive compensation (aka bonuses) >*Individual incentive plan*: bonus for meeting individual goal > *Group incentive plan*: bonus for meeting group goal
> *Gainsharing plan*: reward for increasing productivity or saving money > *Profit-sharing plan*: share of organizational profits if organization meets or exceeds profit goals
Major benefits *not* required by law
>*Retirement plans*: pension (becoming much less common) >*Medical insurance*: U.S. average $11k per employee per year -1/3 of companies don't offer -Shift to part-time workers
Muscle-Building:
>The A employees: challenge, job-rotate, and promote them > The B employees: develop them or re-assign them so that they can become A employees >The C employees: develop them so that they can become B employees, or move them out of the organization (but *never* transfer them elsewhere within the organization!)
Basic benefits required by law:
>Workers' compensation-financial support for work-related injury or illness >Social security- financial support to retirees and disabled employees > Unemployment insurance - financial support for laid-off employees
SWOT analysis
A comparison of strengths, weaknesses, opportunities, and threats that helps executives formulate strategy.
ISO 9001
A series of quality standards developed with worldwide business application
Job analysis
A tool for determining what is done on a given job and what should be done on that job.
Optimizing
Achieving the best possible balance among several goals
Union shop
An organization with a union and a union security clause specifying that workers must join the union after a set period of time.
Termination: aka "firing" for poor performance or "cause" -Employment-at-all: the legal concept that an employee may be terminated for any reason -Exceptions
Case study/experience: -Panning/HR involvement/ "performance plan" assuming time allows (some exception/risks) -Termination interview: who present, when, where, how, precautions (typically one termination at a time) -Exceptions
Fair Labor Standards Act of 1938
Creates *exempt (salaried) and nonexempt (hourly)* employee categories, governing overtime and other rules; sets minimum wage, child labor laws
Start-ups have two major liabilities: -Smallness -Newness
Funding: -75% owners' assets -10% owners' credit -Rarely-venture capital Risk: its a given
Communication
Informal: mbwa (class), manager: observe formal: meetings, reports
Matrix organization
Organization composed of dual reporting relationships in which some managers report to two superiors - a functional manager and a divisional manager; seeks best of functional and divisional organizations
360-degree appraisal
Process of using multiple sources of appraisal to gain a comprehensive perspective on one's performance
Age Discrimination in Employment Act (1967)
Prohibits employment discrimination based on age for*person over 40 yrs*
Resumes
Reasons to review the resume: -customized cover letter -relevant job or career objective -high GPA (including high school if early in career) -leadership positions -evidence of life balance Reasons to "loss" the resume: -no cover letter -impersonal/catch-all -inappropriate content (photo, irrelevant material) -misspellings -Scent/"cute" stationery/other odd or troubling aspects
Making good choices -High innovation, Low risk: subway launches an online services to pre-order sandwiches. -High innovation, high risk: medical researchers try to use 3D printing to technology to create organs -Low innovation, low risk: college student launches a resume writing and interviewing tips venture -Low innovation, high risk: entrepreneur opens a pub in a downtown nightclub area.
Successful entrepreneurial ventures don't always require a cutting edge technology or an exciting new product to succeed
Job description
Tasks, duties, and responsibilities involved in performing the job
Responsibility
The assignment of a task that an employee is supposed to carry out
Coordination
The procedures that link the various parts of an organization for the purpose of achieving the organization's overall mission
Outplacement
The process of helping people who have been dismissed from the company regain employment elsewhere.
Background checks
Too easy and too cost-effective not to perform. -conditional offers
Line departments
Units that deal directly with the organization's primary goods and services Ex: engineering, procurement, manufacturing
*The people that you manage represent you*
Who do we want the knuckleheads to work for? *Competitors*
Strategic goals
major targets or end results relating to the organization's long-term survival, value, and growth.
who is the most important person in this complicated, interwoven series of events and relationships?
Your client!
Discounting the future
a bias weighting short-term costs and benefits more heavily than longer-term costs and benefits
Entrepreneurial venture
a business pursuit that: -has growth and high profitability as its primary objectives -is aggressively managed -is innovative
Small business
a business with 500 or fewer employees, independently owned and operated, not dominant in its field, and not typically characterized by many innovative practices
Goal displacement
a condition that occurs when a decision-making group loses sight of its original goal and a new, less important goal emerges.
Maximizing
a decision realizing the best possible outcome
Rule of Thumb
a manager spends 10% to 20% of his/her time planning.
Franchisee
a partner who manages a new store of the same type in a new location
Devil's advocate
a person who has the job of criticizing ideas to ensure that their downsides are fully explored
Brainstorming
a process in which group members generate as many ideas about a problem as they can; criticism is withheld until all ideas have been proposed
*Planning steps* Step 1: Analyze the Situation (Situational Analysis)
a process to gather, interpret, and summarize all info relevant to the planning issue under consideration
Strategic planning (3-7 yrs) by top-level managers
a set of procedures for making decisions about the organization's long-term and strategies
Lost-cost strategy
a strategy an organization uses to build competitive advantage by being efficient and offering a standard, no-frills product. ex: Walmart
The opportunity
an entrepreneur should consider opportunities due to the following factories: 1) technological discoveries 1) Economic dislocations 2) Demographic changes 2) Calamities 3) lifestyle and taste changes 3) Government initiatives and rule changes
*Franchises* Franchising
an entrepreneurial alliance between franchisor and franchisee
Franchisor
an innovator who has created at least one successful store and wants to grow
Differentiation strategy
an organization uses to build competitive advantage by being unique in its industry or market segment along one or more dimensions. Ex: BMW
Delegation
assignment of new or additional responsibilities to a subordinate
Agility
being able to act fast to meet customer needs and respond to outside pressures
Satisficing
choosing an option that is acceptable, although not necessarily the best or perfect.
Planning
conscious, systematic process of making decisions about goals and activities. -It's not an informal or haphazard response to a crisis; it's a purposeful effort that is directed and controlled by managers and often draws on the knowledge and experience of employees at all levels.
Framing effects
decision bias influenced by the way in which a problem or decision alternative is phrased or presented
Six sigma quality
defect-free 99.99966% of the time
Performance appraisal (PA) What is appraised? -results: what was accomplished Behaviors: how employee acted Traits: employee's qualities or characteristics
definition: assessment of an employee's job performance Purposes: administrative -Developmental *(spent 10% of your time on the "scores". spend 90% of your time on the comments)*
Functional organization
departmentalization around specialized activities such as production, marketing, and human resources; fosters efficient expects
Divisional organization
departmentalization that groups units around products, customers, or geographic regions; develops customer focus
Opportunity Analysis
description of good or service, an assessment of the opportunity, an assessment of the entrepreneur, specification of activities and resources needed to translate your idea into a viable business, and your source(s) of capital.
Demand forecasts
determining how many and what type of people are needed (the most difficult part of HR planning)
Accountability
expectation that employees will perform a job, take corrective action when necessary, report their performance
Example 3: Diversity training
programs that focus on identifying and reducing hidden biases against people with differences and developing the skills needed to manage a diversified workforce
Behavioral description interview
explores what candidates have actually done in the past
3 types of plans used by organization 1) Single-use plan
focuses on achieving non-repeating goals. Ex: design blueprints
Situational interview
focuses on hypothetical situations
Business plan
formal planning step that focuses on the entire venture and describes all the elements involved in starting it -a document that determines the viability of the enterprise
Strategic alliance
formal relationship created among independent organizations with the purpose of joint pursuit of mutual goals.
Stakeholders
groups and individuals who affect and are affected by the achievement of the organization's mission, goals, and strategies. Ex: customers, supplies, and the community.
Supply of labor
how many and what types of employees the organization actually will have.
Entrepreneur
individual who establishes a new organization without the benefit of corporate sponsorship; takes careful, calculated risks and acts upon those decisions
Bootlegging
informal work on projects, other than those officially assigned, of employees' own choosing and initiative
Total Quality Management (TQM)
integrative approach to management that supports the attainment of customer satisfaction through a wide variety of tools and techniques that result in high quality goods and services
3 types of plans used by organization 2) Standing plan
is designed to accomplish an enduring set of goals Ex: plan for routine dam maintenance and hydroelectric turbine operation
Job specification
knowledge, skills, abilities and other characteristics required to perform the job
Right-to-work
legislation that allows employees to work without having to join a union
Authority
legitimate right to make decisions and to tell other people what to do. Formal: vested in position Informal: vested in person (not necessarily and probably not, the "bosses")
*Planning Steps* Step 5: Implement the goals and plans
managers and employees must understand the plan, have the resources to implement it, and be motivated to do so. Successful implementation requires: -linkage between plan and budget -strong managers who are skilled at execution -participation in development of the plan by the employees -linkage between goal achievement and reward system (ideal)
*Planning steps* Step 6: Monitor and Control Performance
managers must continually monitor the actual performance of their work units against the unit's goals and plans. -managers also need to develop control systems to measure that performance -allow them to take corrective action when the plans are implemented improperly or when the situation changes.
Initial Public Offering (IPO)
means to raise capital via federally registered and underwritten sales of shares in the company Pros: access to capital, debt reduction, net worth enhancement, credilbility Cons: expense, shift in focus to quarterly earnings/stock price, investment banking from relationship
Intrapreneur
new venture creator working within large company
Intrapreneurs
new venture creators working inside big companies
Span of Control
number of subordinates who report directly to a manager -must be narrow enough to permit managers to maintain control over subordinates -must not be so narrow that it leads to over-control and an excessive number of managers overseeing a few subordinates.
Illusion of control
people's belief that they can influence events, even when they have no control over what will happen
Groupthink (not a good think, conflict, or debate)
phenomenon that occurs in decision making when group members avoid disagreement as they strive for consensus
Lack of structure
problems and opportunities are novel; no automatic procedures are in place
Entrepreneurship
process by which enterprising individuals initiate manage, and assume the risks and rewards associated with a business venture
Managers by Objectives (MBO)
process in which objectives set by a subordinate and a supervisor must be reached within a given time period.
Benchmarking (comparing competitors)
process of assessing how well one company's basic functions and skills compare with competitor(s) -Goal is to thoroughly understand the "best practices" of other firms and to undertake actions to achieve both better performance and lower costs.
Operational planning (<1 yr) by front-line managers or team leaders
process of identifying the specific day-to-day procedures and processes required at lower levels of the organization Ex: employee vacation schedule, project plan, laboratory experiment
Strategic Management (not planning)
process that involves managers from all parts of the organization in the formulation and implementation of strategic goals and strategies
Skunkworks
project team designated to produce a new, innovative product
Inertia (better an end with horror than horror without end)
reluctance to make decision to change the status quo, especially when it involves a "stop-investment) action
Treason (better an end with horror than horror without end)
reluctance to speak up or take action against a top management initiative (pet project) even if the initiative is not good business (a dog)
Organization chart
reporting structure and division of labor in an organization
*Interviews* Structured interview
selection technique that involves asking all applicants the same questions and comparing their responses to a standardized set of answers Hybrid: each of multiple interviewers focuses on a different interview topic
3 types of plans used by organizations 3) Contingency plan
specifies actions when initial plans fail or events in the external environment create sudden change Ex: emergency evacuation plan
Uncertainty
state that exists when decision makers have insufficient info
Risk
state that exists when the probability of success is less than 100% and losses may occur
*Planning Steps* Step 2: Generate Alternative Goals and Plans
stress creativity and encourage managers and employers to think broadly about challenges (A-C plans, generate alternative plans) -Smart goals: Specific, Measurable, Achievable, Relevant, Time-bound
Pay structures
structure must consider -internal factors -external factors
Strategic control system
supports managers in evaluating organization's progress with strategy and offers corrective actions if discrepancies exist. Key element is *budget*
Human resources management
system of organizational activities to attract, develop, and motivate an effective and qualified workforce. -Also known as talent, human capital, or personnel management
Recruitment
the development of a pool of applications for jobs in an organization -internal, external
Employment-at-all
the legal concept that an employee may be terminated for any reason
Labor relations
the system of relations between workers and management
Strategic Tactical Operational
they're all aligned
Example 1: Orientation training
training designed to introduce new employees to the company and familiarize them with politics, procedures, culture, and the like.
Example 2: Team training
training that provides employees with the skills and perspectives they need to collaborate with others
Tactical planning (1-2 yrs) by mid-level managers
translates broad strategic goals/plans into specific goals/plans that are relevant to a distinct portion of the organization Ex: annual business plan for organizational unit (division, department, group)
Staff departments
units that support line departments Ex: human resources, legal, finance (overhead)
Options
whatever strategies manages adopt, the most effective strategy is one that competitors are unwilling or unable to imitate.