Management First partial

Management (Merriam-Webster)

The act or skill of controlling and making decisions about a business.

Management (Business Dictionary)

The process of organizing, planning, leading, and controlling resources to achieve organizational objectives.

Manager

A person responsible for making decisions about the allocation of resources and directing others to achieve goals.

Decision Making

Selecting among alternative courses of action.

Objectives

Desired end-states or outcomes that management seeks to achieve.

Why Study Management

Connects theory to practice, helps understand organizations and institutions, integrates interdisciplinary insights, and develops employable skills.

Benefits of Understanding Organizations

Improves decision-making, collaboration, career prospects, and societal impact.

Acquisition of Resources

Obtaining the inputs (human, physical, financial) required for activity.

Allocation of Resources

Deciding how resources will be used or distributed within the firm.

Integration of Resources

Coordinating different resources to achieve synergy in operations.

Economic Activity

Production and consumption of economic goods.

Management as Science

A systematic body of knowledge and analytical tools for prediction and decision-making.

Management as Art

Applying managerial knowledge in real-world contexts requiring creativity and judgment.

Economic Goods

Goods that require human effort to produce and are scarce enough to command a price.

Production

The process of creating goods or services not directly provided by nature.

Consumption

The use of goods to satisfy needs.

Goals

Aspirations and purposes that drive human activity.

Needs

States of dissatisfaction due to the absence of something desirable.

Scarcity

The limited nature of resources relative to human wants.

Choice

The act of selecting how scarce resources will be used.

Fundamental Economic Questions

What to produce, how to produce, and for whom to produce.

Maslow's Hierarchy of Needs

Model of human motivation: physiological → safety → belonging → esteem → self-actualization.

Critiques of Maslow

Lacks empirical support, culturally biased, overly rigid in assuming sequential satisfaction.

Primary Goods

Satisfy essential/basic needs (e.g., food, water).

Non-Essential Goods

Satisfy luxury or secondary wants (e.g., champagne).

Complementary Goods

Goods consumed together to satisfy one need (e.g., car + fuel).

Substitute Goods

Goods that replace each other in consumption (e.g., coffee vs tea).

Differentiable Goods

Products that include unique features to distinguish them.

Commodities

Undifferentiated goods with identical features regardless of producer (e.g., crude oil).

Consumer Goods

Goods used for final consumption.

Industrial Goods

Goods used to produce other goods.

Disposable Goods

Single-use products.

Durable Goods

Long-lasting goods used multiple times.

Goods for Individual Consumption

Used by one person at a time.

Collective Consumption Goods

Used simultaneously by many individuals (e.g., cinema, park).

Public Goods (Definition 1)

Non-excludable and non-rivalrous goods (e.g., national defense).

Public Goods (Definition 2)

Goods considered of sufficient social value to be made public through collective decisions.

Private Goods

Excludable and rivalrous goods sold in markets.

Excludability

The ability to prevent non-payers from using a good.

Rivalry in Consumption

When one person's use reduces others' ability to consume.

Examples of Public Goods

National security, clean air, public roads.

Technical Transformation

Physical (manufacturing), spatial (transport), or logical (banking) transformation of inputs.

Transactions

Buying inputs and selling outputs; link organizations through exchange.

Complementary Support Activities

Institutional design, HR management, accounting, and information systems.

Circular Flow Model

Money flows between businesses and households as wages and payments for goods.

Owners

Provide capital and resources; may manage or delegate.

Customers

Purchase goods and services offered by firms.

Employees

Execute tasks and operations within a firm.

Management

Coordinates resources and operations to achieve goals.

Marketing (4 Ps)

Product, Price, Place, Promotion — designing, pricing, distributing, and communicating offerings.

Finance Function

Managing the acquisition and allocation of money for operations and investment.

Entrepreneur

Individual who risks wealth, time, and effort to develop a profitable innovation.

Government Role

Maintains competition, protects stakeholders, stabilizes economy, and supports growth.

Public Utilities

Services deemed necessary for the public and often provided or regulated by the state.

Non-Profit Organization

Private organization not distributing profits, pursuing social, cultural, or humanitarian objectives.

Characteristics of Non-Profits

Private, non-profit-distributing, active in areas like culture, education, environment, or health.

Volunteers

Individuals offering time and skills without pay to non-profit causes.

Company

A legal entity formed by members sharing resources to conduct economic activity.

Partnership

Business with partners having unlimited liability; ends upon partner departure.

Corporation

Separate legal entity with limited liability; ownership divided into shares.

Limited Liability

Shareholders' financial risk is limited to their investment.

Corporate Purpose

The company's reason for existing — to create value for stakeholders, not just profit.

Stakeholder vs Shareholder View

Shareholder view = profit maximization; stakeholder view = value creation for all affected groups.

Stakeholder

Anyone affected by or able to affect a company's actions.

Stakeholder Analysis

Identifying stakeholders and assessing their interests and power.

Stakeholder Map

Visual diagram showing relationships and influence between stakeholders.

Coalitions

Groups of stakeholders uniting to increase influence; dynamic and issue-specific.

Market Stakeholders

Those engaged in economic transactions (employees, customers, suppliers, creditors).

Non-Market Stakeholders

Those indirectly affected (communities, governments, NGOs, public).

Voting Power

Ability to influence decisions through formal votes (e.g., shareholders).

Economic Power

Control derived from financial or resource dependence.

Political Power

Influence through government or regulation.

Legal Power

Ability to enforce laws or bring lawsuits.

Informational Power

Control of critical data or ability to shape public perception.

Stakeholder Salience Model

Importance determined by power, legitimacy, and urgency.

Latent Stakeholders

Possess one attribute (low salience).

Expectant Stakeholders

Possess two attributes (moderate salience).

Definitive Stakeholders

Possess all three attributes (high salience).

Legitimacy

Perception that stakeholder's claims are appropriate or proper.

Urgency

Degree to which a stakeholder's claim calls for immediate attention.

Problems of Stakeholder Analysis

Unclear stakeholder boundaries, misidentification, neglect of marginalized groups, and organizational bias.

Shareholder (Stockholder)

Investor owning part of a company via purchased shares.

Individual Investors

Private persons owning shares directly ("Main Street").

Institutional Investors

Organizations (funds, banks, insurers) holding large share portfolios ("Wall Street").

Capital Appreciation / Capital Gain

Profit made when the value of a share increases.

Dividend

Portion of company earnings distributed to shareholders.

Short-Term Investor

Seeks immediate financial returns.

Long-Term Investor

Focuses on sustained growth and value creation.

Public Limited Company (PLC)

Listed on a stock exchange; shares sold to the public.

Private Limited Company (Ltd)

Not publicly traded; ownership concentrated among few.

Shareholder Rights

Vote on key matters, receive dividends, inspect records, sue, sell shares.

Annual Report

Official summary of financial performance shared with shareholders.

Proxy Voting

Allowing another person to vote on one's behalf at meetings.

Corporate Governance

System of rules and processes by which a company is directed and controlled.

Board of Directors

Group elected by shareholders to oversee company management.

Executive Directors

Board members who are part of company management.

Non-Executive Directors

External board members overseeing managers; may be independent.

Independent Director

Not affiliated with company management or controlling shareholders.

Chairperson of the Board

Leads the board and ensures effective governance.

CEO (Chief Executive Officer)

Manages daily operations; may or may not be the board chair.