Test #2 Study Guide

Consider the traditional approaches to organizing- e.g., simple, functional, multidivisional, and matrix. What are the advantages and disadvantages of each?

(1) A structure most common in small companies where the owner is the primary focus of attention, and who is also responsible for making decisions about business operations. Having one individual make decisions also creates a centralized power structure. -Advantages: Decisions are made faster because owners and managers have knowledge about the entire business. Owners and managers can also choose which products they should produce or the business relationships that will push the company forward. -Disadvantages: Small businesses or other organizations operating under such a structure may at times have trouble running operations in the absence of the owner or primary manager. Complex operations may also have a hard time getting timely feedback on decisions with the structure. (2) A structure that differentiates based on tasks (ex. production, marketing, human resources.) Common for firms offering a limited range of products and competing in a common manner in all markets they serve. -Advantages: Economies of scale can be realized. Greater opportunities for specialized training and in-depth skill development. Technical specialists are relatively free of administrative work. Decision making and lines of communication are simple and clearly understood. -Disadvantages: Poor communication and coordination across tasks. Slow to respond to change. Can potentially overload top management. (3) A structure that differentiates initially by a complete output (ex., products, customers, or geographic regions). Also allows a firm competing in multiple different areas to have separate units for each area. -Advantages: Coordinates takes necessary for the output (since each division has its own functional units). Responsive and adaptive to the output. Allows for profit center accountability. -Disadvantages: Poor sharing of sills and information across outputs. Can be difficult to coordinate organization-wide actions or focus on organization wide-goals. Raises costs due to duplication of tasks. (4) An organization composed of dual reporting relationships in which some subordinates report to two superiors- a functional manager and a divisional manager. -Advantages: Allows a dual focus of when both tasks and output are important. Encourages cross-functional problem-solving. Limits demands on upper-level management. Builds an extensive communication network. -Disadvantages: Having two bosses can cause problems (violates "unity of command"). Managers can have conflict as they jockey for key subordinates and other resources. Extensive communication can sometimes lead to slower decision making.

How does a Multicultural organization differ from one that is Monolithic or Pluralistic?

(1) An organization that values cultural diversity and seeks to utilize and encourage it. (2) An organization that has a low degree of structural integration- employing few women, minorities, or other groups that differ from the majority- and thus has a homogenous employee organization. (3) An organization that has a relatively diverse employee population and makes an effort to involve employees from different gender, racial, or cultural backgrounds.

What are the contemporary approaches to leadership?

(1) Charismatic Leadership: Showing traits of dominance, self-confidence, stands by the moral righteousness of his beliefs, and is able to evoke excitement and adventure in followers. (2) Transformational Leadership: Showing the ability to motivate people to transcend their personal interests for the benefit of the group. They are charismatic but they also have an inspiring vision, they challenge the norms of society, and they also care about other people. (3) Transactional Leadership: Having the ability to manage through transactions, use their legitimate, reward, and coercive powers to give commands and exchange rewards for services rendered. Uses contingent rewards, active management by exception, and passive management by exception. (4) Authentic Leadership: A style in which the leader is true to him/herself while leading. Uses self-awareness, Integrity, and Introspective. (5) Servant Leadership: A style in which a leader serves the needs of others while strengthening the organization. It requires humility and a focus on helping others grow and develop.

What are the major steps in HR planning and why is each important?

(1) Planning- Ensure that the right number and types of people are available. HR managers must know the company's business plans- the direction it takes, the type of business it intends on becoming, they kind of growth in the future that is expected, etc. (2) Programming- HR managers implement specific human resources activities (ex. recruitment, training, and pay systems.) (3) Evaluating- HR managers evaluate whether specific activities produce the results necessary to pursue the best business plans.

What is the difference between Affirmative Action and a Diversity Management program?

(1) Special efforts to recruit and hire qualified members of groups that were discriminated against in the past. (2) Involves basic activities such as recruiting, training, promoting, and utilizing to full advantage for individuals with different backgrounds, beliefs, capabilities, and cultures. -Also involves understanding and deeply valuing employee differences to build a more effective and profitable organization.

What are the major components of HR programming?

(1) Staffing- Ensure legal compliance with: A variety of labor laws, Fairness in the form of nondiscrimination, promoting diversity. (2) Training and development- Working with managers to assess training needs. Develop programs and evaluate effectiveness, train employees on how to best accomplish current jobs. Develop skills that will allow employees to move up to higher-level jobs. Programs that support the organization- (ex. culture, diversity, etc.) (3) Performance Appraisal- Development and feedback. Evaluation and promotion. (4) Compensation- Pay. Benefits. (5) Labor Relations- Legal and Ethical. Unions. Employee Voice and Involvement.

What do they give up in comparison to traditional approaches?

(1) They give up regular communication and use enhanced communication like social media or a live chat. (2) They give up regular decision making. Instead, they seek input from staff members which improves employee and work life as well as productivity (3) They give up scheduled and led meetings which can include agenda creation and control of the meeting's flow. Now employees are empowered to call and lead meetings on their own. Better ways to interact from employee to employee. (4) Team members give up individual accountability and instead, the entire team is subject to mutual accountability. (5) They give up limited perspectives on performance reviews of employees. Instead, they evaluate employees with far more insight. Since feedback is solicited not only by managers, but by peers, subordinates and business partners, pictures of employees' strengths and weaknesses are far more accurate too. Small businesses especially benefit from this type of evaluation because their accuracy helps expose performance gaps that can be filled quicker compared to traditional organizations.

(Lesson 7- Chapter 10) What are the three traditional approaches to the study of leadership?

(1) Trait Approach- Focuses on personal attributes (or traits) of leaders such as physical and personality characteristics, competencies, and values. (2) Behavioral Approach- Focuses specifically on what leaders do and how they act; how leaders interact with followers. (3) Situational Approach- Focuses on how a leader acts given a specific set of circumstances.

How did each approach evolve from the previous one, the major findings from each:

(1) Trait approach- Was called "great man" theory early on because they focused on qualities and characteristics possessed by great social, political, and military leaders (Abraham Lincoln, Moses, etc.) In the 1990s emotional intelligence gained traction as part of trait approach. (2) Behavioral Approach- Early studies looked at task versus group-oriented behaviors of leadership. The Leadership Grid said these orientations were not mutually exclusive. It also asserted that the goal was to be a 9,9 leader- that is to be high on both "Task" and "people" dimensions. (3) Situational approach- Came from Fiedler's contingency model. Hersey and Blanchard's situational theory, Path-Goal theory, Vroom Model. ->(Fiedler's Contingency Model): A situational approach to leadership postulating that effectiveness depends on the personal style of the leader and the degree to which the situation gives the leader power, control, and influence over the situation. ->(Hersey and Blanchard's Situational Theory): A life-cycle theory of leadership postulating that a manager should consider an employee's psychological and job maturity before deciding whether task performance or maintenance behaviors are more important. Contains job maturity where the level of the employee's skills and technical knowledge relative to the task being performed. Also contains psychological maturity in which an employee's self-confidence and self-respect play big roles. ->(Path-goal framework): Concerns how leaders influence subordinates' perceptions of their work goals and the paths they follow toward the attainment of those goals. ->(The Vroom Model): A situational model that focuses on the participative dimension of leadership. It also uses a decision tree approach to determine which decision style will be best (e.g., the significance of the decision, leaders expertise, commitment of followers, etc.) -> Five decision styles in this model are: #1 Decide, #2 one-on-one consultation, #3 Consult the group, #4 Facilitate, and #5 Delegate.

If a firm wants to manage diversity well, what are the challenges they are likely to face?

(1) Unexamined Assumptions. (2) Lower cohesiveness. (3) Communication problems. (4) Mistrust and tension. (5) Stereotyping.

What are the trends in U.S. demographics and how will they impact firms as they try to manage a diverse workforce?

(Women) -Women earn more post-secondary degrees than men( about 57% of bachelor degrees, 60% of masters and 53% of PHD's). -But women in the workforce only earn about 82 cents per dollar compared to males. -While women now occupy just over half of all management positions, they are poorly represented at the highest levels. -Only about 10% of Fortune 500 CEO's are women. -Only about 20% of Fortune 500 Board of Director positions are held by women. (Minorities and Immigrants)- Black, Asian, and Hispanic workers hold more than one of every three jobs. -Foreign-born workers make up more than 17% of the U.S. civilian labor force. About 1/2 of these workers are Hispanic, and 24% are Asian. - One in 66 people in the United States identifies him/herself as multiracial, and the number could soar to 1 in 5 by 2050. -People with disabilities are the largest unemployed minority in the United States. Impact: It would be ideal to treat everyone differently. -But- we are all socialized as we grow up. Influences include family, friends, schools, media, and much more. -All of these combine to create "Implicit Biases"- unconscious stereotypes that influence how we understand, perceive, and react to others. -While the unconscious nature of these biases makes them hard to overcome, we can at least be aware that they are likely there.

How would an emphasis on Diversity impact a firm's Human Resource efforts?

- Affects the development of interpersonal relationships - Affects how supervisors and managers interact with staff and how employees relate to one another -Affects HR functions such as record keeping, training, recruiting, etc.

What, if anything, is the difference between leading and managing?

-(1) To motivate and give meaning to organizations, envision and create a positive future. -(2) To guide, support, and give corrective feedback for day-to-day activities to goals can be accomplished.

In thinking about this, consider how the choice of the amount of differentiation versus integration influences things like the vertical structure, the span of control and whether a structure is more mechanistic or organic.

-Differentiation influences the vertical structure because it helps indicate how well it is held together. Integration helps influence how much authority a manager has over an organization. -The span of control is the number of subordinates who report directly to an executive or a supervisor. A narrow span is a tall organization with many reporting levels, whereas a wide span is a flat organization with fewer reporting levels. -A mechanistic structure emphasizes Differentiation because it seeks to maximize internal efficiency in a stable environment, focuses on cost and efficiency. -An organic structure emphasizes Integration since it is mostly used in a dynamic environment, and focuses primarily on responsiveness and change.

(Lesson 5 Chapter 7) What role do differentiation and integration play as fundamental building blocks of organizing?

-Differentiation: An aspect of the organization's internal environment created by job specialization and the division of labor. -Integration: The degree to which differentiated work units work together and coordinate their efforts. -For organizing, the organization chart is able to depict the positions in a firm and the way they are arranged (and the work too).

Which programming component belongs to each area of POLC?

-HR programming is a big part of planning and organizing, also a major component of leading. -There is some substance to the idea that "people are the most important resource in a company and the primary source of competitive advantage." -Need for HR Manager to be "part of the conversation" with functional and upper level management- an integral part of Organization.

How does interdependence help determine the level of differentiation and integration a firm should use?

-Interdependency is the degree to which various tasks within the organization are interrelated. And as a general rule, the greater the level of interdependency, the greater the need there will be for coordination. -Interdependence comes through delegation and collaboration of both leadership and employees within an organization. 3 types of interdependency: (1) Pooled is when units draw from and contribute to a common pool of resources, but do not directly interact with one another. (2) Sequential is when the output of one unit becomes the input to another unit. Units later in the chain are more dependent than those at the beginning of the chain. (3) Reciprocal is when the work of the units is interconnected. The output of unit A becomes the input of unit B, but unit B's output becomes an input of unit A.

Challenges a firm may face within each component above

-Staffing: New technology, Ghosting, Candidate-Driven Market. -Training and Development: Different learning habits, Lack of engagement, costs! -Performance Appraisal: Lack of objectivity, clashing goals, Both the manager and the employee care too little. -Compensation: Competing for talent, Legal Compliance Issues, Recognizing and Rewarding Employees. -Labor Relations: Managing and resolving conflicts, Safe and comfortable working conditions, Work-life balance.

What is the role of power in leadership and what are the sources of power that a leader might pull from?

-The ability to both influence other people to perform tasks they otherwise would not do. -Sources include: Legitimate power is the right or authority to tell others what they should do. Usually a boss or someone high up. -Reward power is when a leader influences others by controlling valued rewards; people comply with the leader's wishes so as to receive those rewards. -Expert power is when a leader who has specific expertise or knowledge; people comply because they believe in, can learn from, or can otherwise gain from that expertise. -Referent power is when a leader has personal characteristics that appeal to others; people comply because of admiration, personal liking, a desire for approval, or a desire to be like the leader. -Coercive power is when a leader has control over punishments; people listen so they can avoid facing them.

How do they relate, if at all, to the three traditional approaches?

-Traditional leadership is about control, rules, regulations, and boundaries while contemporary business approaches are about freedom of thought, room for creativity, the value of the outcome, and a warm welcome for new ideas. -Contemporary approaches do tie into traditional approaches. For example, Charismatic leadership and level 5 (get back to traits) and Transformational and Transactional (get back to behaviors). However, contemporary approaches give modern and adaptive spins on common business practices, while traditional approaches keep things the way they were before and they don't seem to be open to change.

Are there potential benefits to a firm from trying to be proactive in managing diversity?

-You are able to attract, keep, and motivate employees. -Understand diverse markets. -Leverage creativity and innovation in problem solving. -Allow for more flexibility.

When and why would a firm switch from one to the other?

1) Use a simple structure when only one person is in charge of an organization. (2) Use a functional organization when operating a business that for example, manufactures industries. For small industries with a few products. (3) Use a multidivisional structure when a company grows in size and complexity. (4) Use a matrix structure in project management because it speaks to both the product of the project and the function of the management producing it.

Consider new forms of organizing like the network structure. What is driving firms to consider these new approaches to organizing?

A network organization is a collection of independent, mostly single-function firms that collaborate to produce a good or service. A network organization describes not one firm but a web of relationships among many firms. Network organizations are also flexible arrangements among designers, suppliers, producers, distributors, and customers in which each firm is able to capitalize on its core capability. In other words, a company becomes more efficient and dynamic.

Why should HR be an integral part of the strategic discussions of a firm?

Companies attempt to compete through people and since firms can create a competitive advantage when they possess or develop resources that are valuable, rare, inimitable, and organized. This very criteria applies to the strategic impact of human resources: (1) People create value by helping to reduce costs and provide something unique to customers. (2) Talent is rare. Top companies invest and hiring and developing the best and most skilled employees to gain an advantage over competitors. (3) Well-chosen, motivated people are difficult to find. Competitors struggle to get the most out of their employees since they struggle to match the culture of high-end companies. (4) People can be organized for success. Competitive advantage comes when companies are able to rapidly mix people's talents to collaborate on new assignments.

What new insights, if any, do the contemporary approaches give us?

Contemporary approaches give modern and adaptive spins on common business practices; they are very innovative.

What is the good and/or bad of emphasizing one over the other?

Highly differentiated firms are successful if they also report high levels of integration and are more likely to fail if they operate in complex environments but fail to integrate their activities correctly. But focusing primarily on integration may slow innovation down for a while.

(Lesson 6 - Chapters 8 and 9)-> How does Human Resource Management (HR) fit within our Planning, Organizing, Leading, and Controlling (POLC) framework?

It is a key part of planning, organizing, and leading. (1) Its connection to planning via strategy involves finding the right people to support strategic efforts. It also evaluates, trains, and promotes the right people to support a strategy(s). (2) Its connection to organizing is through finding and keeping the right people to watch the jobs by structure. This happens by recruiting and selection, training and development, and rewards for directing efforts and keeping the best people. (3) Its role in leading through HR, it is ensured that the best people are recognized, rewarded, and motivated.

Given all the studies that have been done on leadership. what is your perspective of what we know, and don't know, about the topic?

Still there is no clear consensus about Leadership- BUT most approaches provide at least some insight for: Evaluating Leadership and Developing your own Leadership Skills

What is meant by the term Diversity?

The understanding and acceptance of the fact that people have individual characteristics, which makes them different from one another, particularly in the context of comparing individuals in a group. Characteristics include race, ethnicity, gender, religion, political ideologies, sexual orientation, age, etc.

How do they do this?

Use market mechanisms to facilitate coordination and integration. They require new capabilities- trust, collaboration, etc.