MGT 300 Mid Term

Scientific Management (Taylorism)

A theory that analyzes workflows to improve economic efficiency and labor productivity (Frederick Taylor)

Soldiering

• Workers working at the rate as the slowest among them

  • High labor costs for the company

  • Studied and analyzed productivity of men and machines

  • Expectation of higher output

Efficiency

• A measure of productivity

• Use of resources - people, money, materials, time - wisely and cost-effectively

Effectiveness

• A measure of quality

• To achieve desired results and goals successfully

• End-results-focused

4 Principles of Scientific Management (Taylorism)

1. Scientifically study each task to evaluate and establish performance goals; determine the “one best way”

2. Scientifically select and train workers based on their abilities and competencies

3. Monitor and assess performance and efficiency; provide instruction and incentives to ensure productivity

4. Division of labor between managers and workers; managers should plan and train, and workers should implement their training

Bureaucracy (1905)

“An organizational structure that is characterized by many rules, standardized processes, procedures and requirements, number of desks, the meticulous division of labor and responsibility, clear hierarchies and professional, almost impersonal interactions between employees.” - Max Weber

5 Characteristics of Bureaucracy

1. Rules and regulations

2. Hierarchy of authority

3. Division of labor

4. Impersonality

5. Merit-based career advancement

4 Functions of Management (POLC) - Henri Fayol

1. Planning

2. Organizing

3. Leading

4. Controlling

Planning

Setting organizational goals and deciding how to achieve them

Organizing

Arranging people, tasks, and resources to accomplish goals

Leading

Motivating, directing, and influencing others to achieve the goals

Controlling

Monitoring performance comparing with desired goals, and taking corrective actions

Criticisms of Classical Management Theories

• Rigidity, inflexibility, and resistance to change

• Lack of consideration of individuals as human beings; being too mechanistic

• Heavy emphasis on economic needs, but ignores individual social and psychological needs
  
  

Human Relations Movement

• A field of management study that focuses on worker psychology, group dynamics, and social needs in the workplace

• Hawthorne studies by Elton Mayo (1924-1927)

Hawthorne Effect

Individuals modify their behavior in response to awareness of being observed

Maslow’s Hierarchy of Needs

• Abraham Maslow

• We have a variety of needs that motivate us

• Meet basic or lower-level needs before pursuing higher order needs

• Self-actualization - realize true potential; achieve “ideal self”

Theory X/Y

• Douglas McGregor

• Theory X (authoritarian)

• Theory Y (participative)

Theory X (authoritarian)

• Pessimistic; negative view

• Irresponsible, resistant to change, lack ambition, hate work, want to be led rather than lead

Theory Y (participative)

• Optimistic; positive view

• Responsible, have self-direction and self-control, imaginative, and creative

Management Science

• Applies quantitative approaches in management

• Operations management

System

A set of interrelated parts that operate together to achieve a common purpose

Organization

A system of interrelated parts or subsystem

Subsystem

Parts making up the whole system

Synergy

Together, the parts and subsystems can produce something greater than if they were to produce on their own (Managers of different business units should work as a collective whole rather than isolated units)

Open System

Continually interact with its environment

Closed System

Little interaction with the environment (Classical management, management science)

Contingent Theory

• Fred Fiedler 

• A manager’s approach should vary depending on the individual and the context; no “one best way” (Flexible, adaptive)

• Appropriate theory or tool for appropriate situations

• Problems are addressed case-by-case basis

Learning Organization

An organization that actively creates, acquires, and transfers knowledge within itself and it able to modify its behavior to reflect new knowledge

Learning Organization Manager Practices

• Create and acquire knowledge

  • Hiring new talents and expertise

  • Maintain a learning culture

• Transfer knowledge

  • Share personal successes and challenges; learn from peers and employees

  • Try new ideas and technologies 

• Modify behavior

  • Assess learning and performance improvement

Knowledge Management (KM)

Processes of identifying, organizing, storing, and disseminating information within an organization to improve knowledge practices, decision-making, and improve performance

Tacit Knowledge

Difficult to articulate or share, experiential, often in the minds of individuals

Explicit Knowledge

Easily written down, codified, taught

Mission

• Purpose of the organization’s reason of being

  • Why are we here?

  • What are our intentions and objectives

  • Who do we serve?

Vision

• Clear sense of the future

  • What we will become

  • Where we will go

Values

• Core guiding principles - beliefs, ethics, aptitudes

  • What do we stand for?

  • What do we value?

Environmental Scanning

Gathering and analyzing information about an organization’s internal and external environment

Organizational Structure

A formal system of tasks and direct reports relationships

Organization Chart

Illustrates the formal relationships of positions of authority and reporting

Organizational Design

Process of aligning the structure with its set goals

Job Design

Specifying employee’s roles and responsibilities within the organization

Scope of Control

Sales reports, revenue, budget, production and operations processes, compliance with company policies, customer satisfaction, performance of employees

Pros of POLC

• Helpful for first-time managers

  • Understand the roles they play 

  • Understand the relationships between parts of the organization; need to coordinate and work effectively with others

Cons of POLC

• Too simplistic for experienced managers

  • Do not reflect organizational realities

  • Do not consider time constraints

  • Complexities of managing organizations, including the importance of interpersonal skills

Mintzberg’s Perspectives

• Interpersonal roles

  • Interact with people inside and outside their work unit

• Informational roles

  • Receive and communicate information with other people inside and outside the organization

• Decision roles

  • Use information to make decisions to solve problems or take advantage of opportunities

Economic and Legal

• Government promotes businesses and entrepreneurship

  • Allow private ownership of businesses

  • Minimize interference with free trade or goods and services

    • Reduces barriers to imports and exports of goods

  • Pass laws that enable enforceable contracts

  • Establish a currency that’s tradeable in world markets

  • Minimize corruption

Database

An electronic storage file for information

Identity Theft

The obtaining of individual’s personal information for illegal purposes

Demography

Study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income

Empowerment

Giving frontline workers the responsibility, authority, freedom, training, and equipment they need to respond quickly to customer requests

Globalization

• The growing interdependence of the world's economies towards one big market

  • As a result of efficient distribution and communication systems

  • Businesses expand to serve global markets, creating new jobs

  • Rapid changes create a need for continuous learning

Greening

The trend toward saving energy and producing products that cause less harm to the environment

Sustainability

Meeting the needs of the present without compromising the ability of future generations to meet their own needs

Why Go Global?

• To make or save money

  • Availability of supplies

  • New markets

  • Lower labor costs

  • Access to capital

  • Avoidance of tariffs and import quotas

Outsourcing

Using suppliers outside the company to provide goods and services

Offshoring

Using suppliers outside of the country to provide labor, goods, or services, or global outsourcing

Importing

Buying goods outside the country and resells them domestically

Tariff

A customs duty or tax levied mainly on imports

Import Quota

Limit on the numbers of a product that can be imported

Exporting

Producing goods domestically and sells them outside the country

Embargo

Complete ban or prohibition of trade of one country with another

Liscensing

Allowing a foreign company to pay a fee to make or distribute its product or service

Franchising

Allowing a foreign company to pay a fee and a share of the profit in return for using the brand name and packaging of materials and services

Joint Ventures

Strategic alliance with a foreign company to share the risks and rewards of starting a new enterprise together in a foreign country

Foreign Subsidiaries

A company that operates in one country but is partially or wholly owned by a parent company in another country

Culture

Shared set of beliefs, values, knowledge, and patterns of behavior common to a group of people

• Learn at a very young age; through everyday interactions with others

5th Dimension: Long term vs Short term (Hofstede)

The degree to which society emphasizes present or future rewards

• Perseverance, sustained growth, and adaptability

• Delivering short-term success, emphasizes quick results

6th Dimension: Indulge vs Restraint (Hofstede)

The degree of self-control of gratification of basic desires

• Allow vs suppress gratification

GLOBE Project

Massive and ongoing cross-cultural investigations of 9 dimensions involved in leadership and organizations

• Extends Hofstede’s theory and results even further

Future Orientation

How much people delay gratification by planning and saving for the future

Institutional Collectivism

How much leaders encourage and reward loyalty to the social unit

Gender Egalitarianism

How much society maximizes gender role differences

Assertiveness

How confrontational and dominant individuals are in social relationships

Performance Orientation

How much individuals be rewarded for improvement and excellence

Humane Orientation

How much society encourage and reward people for being kind, fair, friendly, and generous

Expatriates

Those who work or live in a foreign country

Returnee

A person who returns to the country where they were born, usually after they have been away for a long time

Common Cultural Trip Wires

• Getting down to business vs. relationship building

• Direct vs. indirect communication

• Low vs. high context

• Informality vs. formality

How to Avoid Cultural Trip Wires

• Take a stock of what you know about the person

• Look for places where you overlap with their style