management midterm 1 study guide

what is the “purpose” of management?

right work, done well

core elements of “right work”

• vision, mission, goals, strategy, and plans

• doing what’s right:

  • legal compliance

  • ethical decision making

  • core values

  • CSR (Corporate Social Responsibility)

• managing growth, innovation, and entrepreneurship

• managing a global business

core elements of “done well”

• organization design

• human resources management

• employee engagement

• performance management

four facets influence management practices

1. economic

2. social

3. political

4. technological

(constantly changing)

how is the study of management history controversial?

• historian bias: data can include biases from the people who write it

• data limitations: may not represent the best practices

what is the best way to study management history?

• study “stages” or “time periods”

• study “schools of thought”

• study “organizations”

• study “biographies”

categories of management practices

• specialization of labor

• systematic management

• scientific management

• administrative management

• human relations management

categories of management practices: specialization of labor

• Adam Smith in the 1700s

• Laborer focus on single component of production

• increase experience and productivity

categories of management practices: systematic management

• early industrial revolution

• engineers and economists had major roles in managing factories

• most of those roles migrated to other specialists over time

categories of management practices: scientific management

• focus on productivity

• Frederick Taylor (late 1800s)

  • record steps in task

  • analyze worker interaction with machines

• Frank and Lillian Gilbreth (early 1900s)

  • time and motion studies

• Henry Gantt (early 1900s)

  • sequential illustrations of workflows

• Statistical Process Control and JIT (mid to late 1900s)

  • Deming, Juran, Ishikawa, Ohno

• Foundations for Lean and Big Data

categories of management practices: administrative management

• Henri Fayol (early 1900s)

  • 14 Principles

  • Management Process

• Max Weber (late 1800s-1900s)

  • Bureaucratic management

  • six doctrines

categories of management practices: human relations management

• increasing power of unions

• advent of employee welfare → personnel departments

• Hawthorne studies

• Mary P. Follett (early 1900s)

• 1930s:

  • National Labor Relations Act

  • Coalition of labor unions (CIO)

• Maslow Hierarchy (1940s)

• H. Simon - bounded rationality

• Roots of Organization Theory/Organization Behavior studies

Four strategy options

1. differentiation

2. low-cost

3. combo

4. focus (serve the needs of the market better than competitors)

   • segments include geographic, demographic, etc.

External analysis tools

Porter’s five forces

Industry life cycle

macroenvironmental

porter’s five forces analysis

• threat of new entrants

• intensity of rivalry

• bargaining power of buyers

• bargaining power of suppliers

• threat of substitutes

industry life cycle analysis

• embryonic

• growth

• shakeout

• mature

• decline

macroenvironmental analysis

• macroeconomic

• global

• technology

• demographics

• social values

• political/legal forces

five attributes of an organization that are evaluated in doing Internal Analysis

• product/service quality

• efficiency

• innovation

• customer responsiveness

• distinctive competencies: the ability to differentiate products/services and/or to achieve lower costs

3 key elements for implementing strategy

• organization structure

• monitoring and control

• culture

why plans are revised or abandoned

• competitor’s actions/reactions

• limited resources or capabilities

• lack of support from employees

• ineffective

• competing priorities

• new information/unexpected events

four elements for doing what’s “right”

1. business law

• labor laws, uniform commercial code, environmental protection, industry specific regulationns

  ethical decision choices

2. ethical decision making: why? what does happen? what should happen?

3. core values

   • underlying norms of behavior and actions expected of all employees (reinforced by example and action)

4. corporate social responsibility

   • actions that recognize and proactively respond to the needs of stakeholders

   • act as a role model, use empathy, and create a broader vision

drivers of economic value of a business

1. profitability (ROIC = NIAT/Equity + LT Debt)

2. growth

options for creating growth

1. existing products/services to current customers

2. gaining new customers while retaining current customers

3. new products/services to current and new customers

4. selling existing products/ services into new markets

5. entering completely new markets with new products/services

what is innovation

executing an idea which addresses a specific challenge and creates value for both the developer and user

mechanisms for successful innovation

1. use of AI

2. use of technology platforms

3. use of collaborative ecosystems

what is entrepreneurship?

bring forth ideas and concepts that create value. entrepreneurs act with urgency in unorthodox ways to address immediate challenges

how do large businesses create successful new ventures?

• top leadership commitment

• creating limited target areas aligned to core competencies of the business

• overcome the typical obstacles that stifle internal new ventures

• create separately funded business development organizations

• use innovation tools

• learn from prior ventures

• terminate successful ventures

factors driving globalization

1. declining trade barriers (less tariffs → free-trade policies)

2. technology enablement (air travel, advanced comms, internet commerce)

3. rise of Multinational Enterprises (MNEs) (more international trade experience)

4. formation of global institutions (WTO and World Bank)

key elements of political economy

1. political climate

2. economic conditions

3. legal system

culture

• many countries are multi-cultural

• some cultures are not receptive to foreign businesses

• cultural differences need to be understood and considered

core strategies for conducting international business

1. global standard (common product sold with minimal variation; optimizes production)

2. local customization (products are customized to meet unique needs)

3. combination (customized in some countries)

strategies for entering a foreign market

1. export

2. license

3. franchise

4. joint venture

5. strategic alliance

6. DIY

how do you decide which strategy to use for entering a foreign market?

• management preferences regarding direct control

• availability of suitable business partners/acquisition targets

• legal factors favoring or disfavoring a particular option

• nature of the products/services

• time required and risks involved