12M Business Leadership - Chapter 1 and 2

Challenges of working in the new economy (6 challenges)

• Intellectual Capital

  • Collected brainpower or shared knowledge of a workplace

  • What people know and learn, and what they do with this knowledge

• Globalization

  • The worldwide interdependence of resources, products, and business competition

• Technology

  • Allows people to work from virtually anywhere

• Diversity

  • Describes the differences in gender, race, age, ethnicity, disabilities, region, and sexual orientation

• Ethics

  • Set of moral standards or what is good and right in one's behaviour

• Careers

  • Career opportunities are limitless for our generation

What is an organization?

• collection of people working together to achieve a common purpose (profit, giving back to society, etc.)

• This includes large and small organizations, businesses, non-profit organizations, governments, school groups, sports teams etc.

Organizations as open systems

• Organizations are open systems

• Composed of interrelated parts that function together to achieve a common purpose

• Interact with their environments

• Transform resource inputs into product outputs (goods and services)

• Environmental feedback tells organization how well it is meeting the needs of customers and society

Organizational performance—How can a company be efficient and/or effective?

• “Value creation” is a very important notion for organizations

• Value is created when an organization’s operations adds value to the original cost of resource inputs

• When value creation occurs:

  • Businesses earn a profit

  • Nonprofit organizations add wealth to society

• Productivity: An overall measure of the quantity and quality of outputs relative to the cost of inputs

• Performance effectiveness: An output measure of task or goal accomplishment

• Performance efficiency: An input measure of the resource costs associated with goal accomplishment

Changing nature of organizations (8 ways organizations are changing)

• Renewed belief in employees

• Disappearance of “command-and-control”

• Emphasis on teamwork

• Prominence of technology

• Embrace of networking

• New workforce expectations

• Concern for work-life balance

• Focus on speed

What is Management?

• The process of planning, organizing, leading, and controlling the use of resources to accomplish performance goals

What is Management Competency?

• Skill-based capability for high performance in a management job, includes communication, teamwork, motivation, leadership, critical thinking, professionalism

Division of Labour

• Labour must be divided because individuals have physical and intellectual limitations

• Everyone can not do everything; even if this was possible, tremendous confusion and inefficiency would result.

• Once labour is divided, it must be coordinated to achieve organizational effectiveness 

What are the three managerial levels?

• Upper

  • Establishes organizational objectives

  • Monitors external environment & trends

  • Examples: CEO, COO (Chief Operating Officer), CFO (Chief Financial Officer), Vice-President of Marketing, VP of Human Resources

• Middle 

  • Interpret direction from above

  • In charge or relatively large departments or divisions consisting of several smaller work units - guide lower management

  • Examples: Deans in Universities, Plant Manager, Human Resource Director

• Lower

  • Ensure that their work teams meet performance objectives that are consistent with higher level organizational goals

  • Examples: Department Head, Supervisor, Foreperson, Assistant Manager

What are the four functions of management? Think of an example for each.

• Planing - a store manager planning for the holiday season by setting sales target, arranging staff schedules, and order stock

• Organizing - manager organizing store resources and assigning roles to employees, ensuring inventory is stocks, and setting ip displays

• Leading - Manager motivating staff and providing guidance on customer service and encouraging teamwork for smooth operations

• Controlling - manager checks if targets are being met, monitor employee performance, and making adjustments if necessary necessary

What are the essential managerial skills?

• Conceptual Skills: The ability to think analytically and achieve integrative problem solving 

• Human Skills: the ability to work well in cooperation with other person 

• Technical skills: the ability to apply expertise and perform a special task with proficiency

Scientific management - Frederick Taylor

• 4 guiding principles 

  • Develop rules of motion, standardized work implements, and proper working conditions for every job.

  • Carefully select workers with the right abilities for the job.

  • Carefully train workers and provide proper incentives.

  • Support workers by carefully planning their work and removing obstacles.

Administrative management - Henri Fayol 

• 5 Rules of Management

  • Foresight: to complete a plan of action for the future

  • Organization: to provide and mobilize resources to implement the plan

  • Command: to lead, select, and evaluate workers to get the best work toward the plan

  • Coordination: to fit diverse efforts together and ensure information is shared and problems solved

  • Control: to make sure things happen according to plan and to take necessary corrective action

• Key principles of management:

  • Scalar Chain: there should be a clear and unbroken line of communication from the top to the bottom of the organization

  • Unity of Command: each person should receive orders from only one boss

  • Unity of Direction: one person should be in charge of all activities with the same performance objective

Theory of Human Needs - Maslow

• A need is a physiological or psychological deficiency a person feels compelled to satisfy.

Need levels:

• Physiological

• Safety

• Social

• Esteem

• Self-actualization

Theory of Adult Personality - Argyris 

• Traditional management principles and practices inhibit worker maturation and are inconsistent with the mature adult personality.

• Management practices should accommodate the mature personality by:

  • Increasing task responsibility

  • Increasing task variety

  • Using participative decision making

Classical management vs. Behavioural management

• Classical management - assumption that people are rational

  • Scientific management (Fredrick Taylor)

  • Administrative principles (Henri Fayol)

  • Bureaucratic organization (Max Weber)

• Behavioural management - assumption that people are social and self actualizing

  • Organizations as communities (Follett)

  • Hawthorn studies (Mayo)

  • Theory of human needs (Maslow)

  • Theory X and Theory Y (McGregor)

  • Adult personality (Argyris)

Quantitative analysis tools

• Management science or operations research:

• The scientific applications of mathematical techniques to management problems

  • Mathematical forecasting makes future projections useful for planning

  • Network model such as a Gantt chart breaks large tasks into smaller components

• Inventory analysis controls inventories mathematically

• determining how much to automatically order and when

• Queuing theory allocates service personnel/workstations to minimize service cost and customer waiting time

• Linear programming calculates how to allocate scarce resources among competing uses

Contingency thinking

• Tries to match managerial responses with problems and opportunities unique to each situations

  • Especially in terms of individual or environmental differences

• No “one best way” to manage

• Appropriate way to manage depends on the situation

Total Quality Management

• Comprehensive approach to continuous quality improvement for a total organization

• Creates context for the value chain