Online Management Midterm Chapters 1-6

What is the "Right Work"?

Identifying what needs to be done by the manager

What is "Done Well"?

How the manager acts, interacts, and influences on a regular basis

Applying management theory

Management cannot be learned through a textbook, but only through practice

What is management?

The tasks (planning, organizing, leading, and controlling) and skills (technical, interpersonal, decision-making) necessary to be an effective manager

What is the purpose of management?

To get the "Right Work, Done Well!"

How to identify the right work

Creating visions and mission statements, setting goals, and planning on how to achieve these goals (strategies)

How to make sure work is "done well"

Assigning responsibility for tasks to others

- creating tasks/jobs that are beneficial to the company

Human Resources Management

- hiring, compensating, motivating employees

Performance management

- Measures your performance

Management skills

- Decision-making, communication, conflict resolution, negotiation, and leadership

Limitations of Management Theory

Although research and experience drive the theory, there is no scientific evidence to back it up

Still learning (7)

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Systematic Management

Engineers and economists had major roles in factories, coordinating many activities

Eventually these jobs were broken down to be more specific

4 facets of management

Economic, social, political, and technological

Approaches to management

Scientific approach

Human behavior approach

Decision theory

Scientific Management

studying workers to find the most efficient ways of doing things and then teaching people those techniques

Current practices: Toyota's Just-In-Time inventory system

Henri Fayol's Administrative Management

14 Principles of Management - flexible principles

Human Relations Management

Helping employees achieve their highest level of productivity and enjoyment of work

Ways to study history of Management

Study the time periods and the changes in strategies

Study the approaches and who uses them/when they were used

Study specific industries and their strategies

Study the successful managers and researchers

Specialization of Labor

Created by Adam Smith; A person is more effective and efficient if they focus on one task rather than the whole

Administrative management

Henri Fayol and Max Weber; concerned with managing the total organization

Max Weber's Administrative Management

Ideal form of governance for business included 6 inflexible principles

Elton Mayo's HR Management

Allowing employees to discuss complaints (often personal, not work-related) allowed for happier and more engaged employees

Labor Unions

National Labor Relations Act & CIO (Congress of Industrial Organizations)

Formed in mid-1930's in order to balance power of the organizations with it's employees

Abraham Maslow's HR Management

Humans need to "self-actualize" - believed best managers were "psychologically healthy"

Herbert Simon's HR Management

Created idea of "bounded rationality" - there is a limited capacity to make the perfect decision

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5 Elements that identify the "Right Work"

Vision, mission, goals, strategies, and plans

Vision Statement

Statement that describes the purpose of the company that is understandable, desirable, and compelling

Purpose for existence

Mission Statement

Description of the products and services an organization will provide, identifies its target audience, and provides reasons to support the organization

Describes HOW the organization will pursue its vision

For-profit Company goals

Financial and operational/strategic goals

Operational goals include market share, # of customers, service levels, customer satisfaction levels, and error levels

Not-for-profit organizations goals

Different than for-profit goals

Typically include # of constituents served or annual fundraising goals

Differentiation Strategy

Distinguish products/services from competitors to achieve goals

Low-Cost Strategy

Developing the least expensive ways competitors to produce and deliver products/services to achieve goals

Combination Strategy

Combines differentiation and low-cost strategies to achieve goals

Focus Strategy

Targets a specific market that the business can better serve to achieve goals

5 step strategy development process

- Develop vision, mission, and goals of the organization

- Conduct an external analysis of the business environment and industry

- Conduct an internal analysis of products & services and capabilities vs competitors

- Evaluate and select the best strategy for achieving goals

- Implement the strategy

Porter's Five Forces

Analysis tool that looks at how the following factors influence profitability in an industry

- Intensity of rivalry, bargaining power of buyers, bargaining power of sellers, threat of new entrants, and threat of substitutes

Industry Life Cycle Analysis

Looks at the typical evolution of industries with the following stages:

Embryonic, growth, shakeout, mature, and decline

Macroenvironmental Analysis

Evaluates factors as an opportunity or threat for the industry with the following factors:

Macroeconomic factors, global trends, technology, demographics, social values, political/legal factors

Factors of internal analysis

Product/service quality (vs competitors), efficiency, innovation, consumer responsiveness, and distinctive competencies

Distinctive Competencies

What makes the organization distinctive; differentiation creates superior value and/or ability to achieve cost leadership in the industry

Core Competencies

Things an organization can do well

Implementing a strategy

Organizational structure: Grouping jobs, delegating authority

Monitoring and control: Periodic progress and goals reviews

Culture: Values, norms, and beliefs which supports the goals

National Labor Relations Act

Right to form a union, strike, etc.

Passed in 1935

Social Security Law

Provides retirement income for retirees over the age of 65

Passed in 1935

Fair Labor Standards Act

Set standards of 40 hour work week and requires 1.5x pay for overtime worked

Passed in 1938

Equal Pay Act of 1963

Illegal to discriminate an employee's wages based on gender

Civil Rights Act of 1964

Illegal to discriminate employment decisions based on race, color, religion, sex, or national origin

Occupational Safety and Health Act

Requires employers provide a safe workplace for employees

The Uniform Commercial Code (UCC)

Provides a set of standard statues for governance of commercial activities

Provides regulations for doing business across state lines

Environmental Protection Laws and Regulations

Business have to follow many environmental protection laws that are governed by the EPA

Industry Specific Regulations

Regulations that apply only to specific businesses that are in a certain industry

Sarbanes-Oxley Act

Requires accuracy of financial statements and reports with significant penalties if it is not followed

Applies to publicly traded companies

What happens when unethical behaviors occur?

Internal factors - morality of the individual, willingness to obey authority, control over one's behavior, and relationships with others

External factors - culture, consequences of this behavior, characteristics of the work, and ease to act unethically

What should happen in an ethical dilemma?

Moral awareness: Realize there is a moral dilemma

Moral judgement: Apply moral standards to do what is morally right

Moral Intentions: Values morals over personal values

Action/Implementation: Implement a plan to be able to follow moral principles

Utilitarian Approach

Choose the best option for the greatest amount of people possible

Individualism Approach

Choose the option that best suits one's individual interests

Moral Rights Approach

Choose the option that does not violate one's fundamental rights

Justice Approach

Distributive - Choose based on equity and fairness

Procedural - Choose based on pre-established rules

Compensatory - Should compensate persons suffering from the decision

Impartial Opinion Approach

Discussing the situation with an independent, 3rd party facilitator

Full Disclosure Approach

Assume the public will know all the information about the decision

Core Values

The underlying norms of behavior and actions that are expected of all employees in an organization

Establishes a foundation for responsible and ethical behavior

Must ACT, do not just state

Corporate Social Responsibility (CSR)

The actions of an organization to recognize and proactively respond to the needs and expectations of all of its stakeholders

Actively work to better the quality of life in the local community in times of crisis

Advantages of engaging in CSR

Increased reputation, reduced risk of damaging incidents with customers, employees want to work for you (lower turnover), and increased revenue enhancement due to community support

Leaders who are proactive in CSR

Create a broader vision that points towards meaning

Acts as a role model

Uses empathy to find common ground

Profitability

The ability of the business to generate long-term positive net cash flows sufficient to provide an appropriate risk-adjusted rate of return on capital employed

Growth

The rate of increase in net cash flows in a business year over year

Using existing customers for growth

Increase their usage of currently purchased products/services

Broaden the number of different products the routinely buy from the business

Upscale (buy more expensive versions of the product/service)

Gaining new customers for growth

Share-building: New customers who were buying similar products from competitors

Market development: Acquiring new customers who have not bought such products in the past and are new to your market

Selling new products and services for growth

Can increase sales to existing customers or bring in new customers

Selling existing products and services to new markets

New geographical markets or new applications for existing products

Entering completely new markets with new products and services

Use existing methods of business to create a competitive advantage over competitors in a new industry

Innovation

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

Artificial Intelligence (AI)

The theory and development of computer systems able to perform tasks that normally require human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages

Machine Learning (ML)

An application of AI that provides systems the ability to automatically learn and improve from experience without being explicitly programmed. Focuses on the development of computer programs that can access data and use it to learn for themselves

Technology Platforms (definition)

Provide a foundation for developing other business offerings

Technology Platforms (examples)

Computing - Android cell phones (the foundation for many companies' phones)

Technology - The Cloud is used for computer data

Service - Netflix allows access to a wide variety of content

Content - Google makes it easier for users to access content through a specific, algorithm-based search engine

Marketplace - Amazon connects sellers with buyers

Collaborative ecosystems

Multiple organizations working collaboratively to enable rapid development of new technologies, products, and services

Using collaborative ecosystems for data

Collecting and using shared data can reduce time and net-cost through the utilization of collective capabilities

Using collaborative ecosystems for Intellectual Property (IP)

Sharing IP such as trademarks and copyrights can speed up the process of developing new technologies

Using collaborative ecosystems for the merge of digital and physical channels

Using the advantages of shared digital settings (Zillow) to improve the business and the consumer experience of the physical side (real estate broker)

Using collaborative ecosystems for new technologies

Sharing research and results can reduce cost and time requires to develop the technology

Entrepreneurship

Acting to bring forth novel ideas and concepts that create value. To do this, they often act with urgency, in unorthodox ways, so as to address their immediate challenges, and generate opportunities amidst uncertainty

When is entrepreneurship used

When businesses cannot generate and sustain the desired amount fo growth through product development

Intrapreneruship includes

- Recognizing high failure rates

- Creating a few target areas and aligning them with core competencies of the business

- Finding ways to overcome risk aversion, short term budgets, etc.

- Using technology platforms and collaborative ecosystems to pursue new opportunities more rapidly

- Learning from both successes and failures in the past

- Understanding when an opportunity has failed and "save face"

Globalization

The trend towards a more integrated and interdependent global economy

Factors of globalization

- Declining trade barriers

- Technology enablement

- Rise of MNEs

- Formation of Global Institutions

Declining trade barriers

Many countries allow free trade as the advantages outweigh the negative effects that certain industries suffer from

Technology enablement

International flights, advanced forms of communication including internet access and internet communication

Rise of Multinational Enterprises (MNEs)

Increase in international businesses succeeding means there is more knowledge on how to successfully expand into the global market

Formation of Global Institutions

International trade rules and organizations (WTO) have been set up to allow for the success of international business

Political Economy

The political climate, the economic conditions and the legal system that exist in a country

Factors of the Political Climate

The level of free trade, corruption, civil unrest, and tariffs

Factors of the Economic Conditions

The overall wealth of the country, possible inflation, tax policies, and the repatriation of profits (transfer back to home country)

Factors of the Legal System

Business norms, acceptance of foreign businesses, laws regarding intellectual property, and protection of those laws

Culture

The norms, beliefs, attitudes, morals, and values that are commonly shared by a large number of the residents of a country

Differences in Culture

Must be careful to understand that different cultures take offense to different things or expect different things regarding business transactions. Understanding the culture of the country that you are doing business in is essential

Multi-cultural

Many countries have multiple cultures, there may not be one singular cultural model to follow for a country

Strategies for International Expansion

Global Standard

Local Customization

Combination Strategy

Global Standard

All products/services are virtually unchanged between markets (marketing is not part of the product)

- Leads top lower production costs (economies of scale)

- Makes sense if demand is not likely to be increased through customization

Local Customization

Products/services modified to meet local market norms in order to increase demand and acceptance

- When demand is heavily influenced through customization and to compete with better customized products

- Disadvantages include increases in production costs

Combination Strategy

Products/services are customized where the differences are significant (and demand is high enough for customization), all others are standardized

- Some markets are not big enough/influenced by customization enough to warrant customization

- Some are big enough and influenced by customization to warrant customization