Intro to management exam 1

Rutgers

Purpose of Management

Right work, done well

right work = what needs to be done

done well = how it is done satisfactorily

Aspects of Right Work

\-developing vision and mission statements

\-setting goals

\-selecting strategies

\-putting plans in place to execute strategies

\-understanding the aspects involved in developing and managing a global business

Drivers of the financial value of business

profitability and growth

HR management

help establish practices of hiring, compensating, and motivating employees

Performance management

using tools and practices to help effectively manage the organization's activities

Limitations of management theory

\-challenges of conducting rigorous research for mgmt practices

\-but there is still value in the contributions made by consultants and business leaders

What do managers do?

planning, organizing, leading, controlling

Need for management emerged in what year

1800s

What enabled economies of scale

\-printing press

\-textile automation

\-steam engine

Specialization of Labor

Focusing work effort on a particular product or a single task

Adam Smith

identified the concept of a person focusing on a single component of the production of goods

specialization of labor

Engineers

focused on how to set up and run machines and on what types of machines were necessary to perform tasks

Economists

focused on the financial aspects of running the factories, like keeping track of costs, setting pay policies, and determining prices

Four facets influence mgmt practices

\-economic

\-social

\-political

technological

\

facets are constantly \______

changing

systematic management

a classical management approach that attempted to build into operations the specific procedures and processes that would ensure coordination of effort to achieve established goals and plans

scientific management

the application of scientific principles to increase efficiency in the workplace

figures in scientific mgmt

\-Frederick Taylor

\-Frank and Lillian Gilbreth

\-Henry Gantt

\-W. Edwards Deming, Joseph Juran, and Kaoru Ishikawa

\-Taiichi Ohno

Frederick Taylor

\-American mechanical engineer, who wanted to improve industrial efficiency

\-believed that focusing on a recording a worker's actions and time spent doing tasks can increase output

\-father of scientific managment

Frank and Lillian Gilbreth

Employed motion study to simplify work and improve productivity

Henry Gantt

developed the Gantt chart to measure and plan work

\-operations research (OR)

\-critical path method (CPM)

\-program evaluation and review technique (PERT)

W. Edwards Deming and Joseph M. Juran

Credited with major influence on the approach to quality in Japanese organizations

Taiichi Ohno

Developed the first "lean" system (aka, the Toyota Production System)

administrative management

concerned with managing the total organization

administrative mgmt figures

\-Henri Fayol

\-Max Weber

Henri Fayol

\-first to suggest a mgmt theory and described the process of mgmt

\-14 ~~principles~~ of management

Max Weber

created the Tenant of Bureaucratic Management

Tenants of Bureaucratic Management

\-Division of labor

\-managerial hierarchy

\-formal selection

\-career orientation

\-formal rules and other controls

\-impersonality

Human Relations Management

focuses on people and sees them as valuable organizational resources in their own right

HR mgmt figures

\-HJ Heinz, International Harvester, Westinghouse Electric

\-Western Electric Company and MIT

\-Elton Mayo

\-Mary P. Follett

\-Herbert Simon

H.J Heinz, International Harvester, and Westinghouse Electric

created employee welfare departments to counter the power of unions

welfare secretaries

\-staffers for welfare programs established by businesses

\-Handled employee complaints, operated medical dispensaries, and watched over recreational activities, education programs, dining facilities, and employee behavior

Western Electric Company and MIT

discovered that increasing or decreasing lighting would increase work productivity

Elton Mayo

\-Hawthorne Experiment 1928, founder of the human relations movement

\-a friendlier supervisory style of management reduced employee aggression

Mary P. Follett

Mother of conflict resolution. Advocated for more civil relationships between employees and managers. Argued that genuine power comes from working with people in a cooperative mode, rather than ruling over people in a command mode.

National Labor Relations Act and the Congress of Industrial Organizations (CIO)

enhanced labor's collective bargaining power to balance the power of organizations and workers

Herbert Simon

\-theory of bounded rationality

\-Suggested that managers cannot make a "perfect decision" due to their limited capacity to process all information provided, emotions, and biases

Organization Behavior and Organization View

* Micro View - focused on behavioral research, such as group dynamics, decision-making, leadership, and motivation
* Macro View - tried to explain the interactions between formal and information processes during operations

Five elements for identifying "right work"

\-vision

\-mission

\-goals

\-strategy

\-plans

Vision statement

describes an organization's purpose for existence

Mission statement

describes the products and services an organization provides

Goals

identifies the outcomes that the organization aims to achieve

For-profit organizations have financial and operational goals

Four strategy options

\-differentiation

\-low cost

\-combo

\-focus

differentiation

making a product different from other similar products

low-cost

have the lowest total cost methods for producing products/services vs competitors

Combination

provides some differentiation at an overall lower price point

Focus

\-serve the needs of a market segment better than competitors' offerings for the total market

\-market segment

Market segments include

\-geographic

\-demographic

\-product/service specialization or customization

External analysis tools

\-Porter's five forces

\-industry life cycle

\-macroenvironmental analysis

Porter's Five Forces

threat of new entrants, intensity of rivalry, bargaining power of buyers, bargaining power of suppliers, and threat of substitutes

Industry Life Cycle

Embryonic, Growth, Shakeout, Mature, Decline

Macroenvironmental analysis

macroeconomic, global, tech, demographics, social values, political/legal forces

Internal analysis tools

\-product/service quality

\-efficiency

\-innovation

\-customer responsiveness

\-distinctiveness competencies

Product/service quality

\-customer perceived performance relative to alternatives

\-distinctiveness competencies

Efficiency

\-outputs/inputs

\-use of resources relative to competitors

\-relative comparison of overall cost structure vs competitors

Innovation

-success rate at developing impactful new products and processes relative to competitors

Customer responsiveness

how well does the org understand its customers' requirements

distinctive competencies

allows the organization to differentiate its products from competitors effectively and to achieve cost leadership in the industry

Three elements of strategy implementation

\-organization structure

\-monitoring and control

\-culture

organization structure

designing jobs and developing a model

Monitoring and control

creation of a system that review progress

Culture

set of values, norms, beliefs, and attitudes shared by the members of the organization

Plans

outline of specific actions, resources, and timeline to complete initiatives to achieve the organization's goals under the strategy chosen

Four elements of doing what's right

\-business law

\-ethical decision making

\-core values

\-corporate social responsibility

business law

\-labor laws

\-uniform commercial code

\-environmental protection

\-industry-specific regulations

labor laws

\-national labor relations act

\-fair labor standards act

\-social security law

\-equal pay act

\-civil rights act

Uniform Commercial Code (UCC)

provides a set of standard statutes for governing commercial activities of businesses / states can use the original or modify their own

Environmental Protection Laws

\-clean air act

\-clean water act

\-noise control act

Industry Specific Regulations

-Sarbanes oxley act

Corporate Social Responsibility (CSR)

an organization recognizing and proactively responding to the needs and expectations of stakeholders

Internal factors of business ethics

\-An individual's moral development

\-Willingness to obey authorities

\-Ability to control one's behavior

\-Relationships with others

External factors of business ethics

\-The organization's culture

\-Consequences of unethical behavior

\-Ease of opportunity to act unethically

\-Characteristics of work

Profitability

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 annually

Options for creating growth

\-existing products/services to current customers

\-new customers while retaining current customers (Share-building/market development strategy)

\-new products/services to current and new customers

\-selling existing products/services into new markets (market expansion)

\-entering completely new markets with products/services

Innovation

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

Entrepreneurship

acting to bring forth ideas that create value

Intrapreneurship

entrepreneurship but in a larger business venture

Mechanisms for successful innovation

\-AI

\-Tech platforms : Provide a foundation for developing other business offerings

\-collaborative ecosystems : Multiple organizations working collaboratively to enable rapid development of new technologies, products, and services

Globalization

the trend towards a more integrated and interdependent global economy

Factors driving globalization

* trade barriers

\-tech enablement

\-rise of multinational enterprises (MNEs)

\-rise of multinational enterprises (MNEs)

Declining trade barriers

\-Reduction of tariffs

\-General recognition of the advantages of free-trade policies

Technology enablement

\-air travel

\-advanced communications

\-internet commerce

Rise in Multinational Enterprises (MNEs)

Knowledge on how to conduct a global business is more accessible

\-more international trade experience and sharing of practice and expertise

Formation of global institutions

\-WTO

\-World bank

Elements of political economy

\-political climate

\-economic conditions

\-legal system

Political climate

\-free trade

\-civil unrest / political upheaval or instability

\-corruption/fraud

economic conditions

\-stable economy

\-sufficient distributed wealth to generate sufficient demand

\-inflation/exchange rates/tax policies

legal system

\-laws and enforcement practices protect the assets, investments, and intellectual property of foreign entities

\-contracts are recognized and enforceable

\-legal regulations are not overly restrictive

Strategies for International Business

\-global standard

\-local customization

\-combination

global standardization

Standardization of products across markets and of the marketing mix worldwide.

Local customization

product/services are customized to meet the unique needs of each country

Combination

\-products are customized in some countries where the market size and unique requirements make it worthwhile

\-all other countries are provided standard products

Strategies for entering a foreign market

\-export

\-license

\-franchise

\-joint venture

\-strategic alliance

\-do it yourself

Export

ship products from another country to the foreign country for sale

License

sell the rights to a third party to make/sell the business' products/services

Franchise

authorize a business partner to use the trademarks/patents and brands while providing business guidance on how to operate

Joint venture

collaborate with a business partner from a foreign country

Strategic alliance

establish a less formal arrangement for two distinct businesses to cooperate in pursuing a business opportunity in countries, which is typically in the form of one organization providing the products and the other manufactures and sells the products

Do it yourself

establishing a new business entity from inception in the target country or acquiring ownership of an existing business in that country

\-more international trade experience and sharing of practice and expertise