Management

  • Managers

    • The people responsible for supervising the use of an organization and it’s employees

  • What is management

    • The planning, organizing, leading and controlling of human and other resources to achieve organizational goals

  • Resources include

    • People and their skills, knowledge, experience

    • Machinery

    • Raw materials

    • Computers and information technology

    • Patents, financial capital, loyal customers and employees

  • Organizational performance

    • Measure of how efficiently and effectively managers use available resources to satisfy customers and achieve organizational goals

  • Efficiency

    • A measure of how well or productively resources are used to achieve a goal

  • Effectiveness

    • A measure of the appropriateness of the goals an organization is pursuing and the degree to which they are achieved

  • Why study management

    • The more efficient and effective use of scarce resources that organizations make of these resources, the greater the relative wellbeing and prosperity of people in that society

    • Manager decisions directly impact the well-being of society and the people in it

    • Helps people deal with bosses and coworkers. Learning management principles can help you make good decisions in non-work contexts

    • Economic benefits of becoming a good manager are also impressive

  • Managerial tasks

    • Managers at all levels in all organizations perform tasks such as planning, organizing, leading and controlling their people. 

  • Planning

    • Decide what goals your organization wants to pursue

    • Decide what strategies to adopt to attain those goals

    • Decide how to allocate organizational resources

    • Managers identify and select appropriate organizational goals and develop strategies to achieve goals

    • Complex, difficult activity

    • Strategy to adopt is not always immediately clear

    • Done under uncertainty

  • Organizing

    • Task managers perform to create a structure of working relationships that allow organizational members to interact and cooperate to achieve organizational goals

    • Involves grouping people into departments according to the kinds of job-specific tasks they perform

    • Organizational structure- a formal system of task and reporting relationships that coordinates and motivated members so that they work together to achieve organizational goals

  • Leading 

    • Articulating a clear organizational vision for its members to accomplish; energizing and enabling employees so that everyone understands the part they play in achieving organizational goals

    • Leadership involved power, personality, influence, persuasion, and control

  • Controlling

    • Evaluating how well an organization has achieved its goals and to take any corrective actions needed to maintain or improve performance

    • Managers monitor performance of individuals, departments, and the organization as a whole to determine if they are meeting performance standards

  • Mintzberg’s managerial roles: decisional

    • Entrepreneur: deciding which new projects or programs to initiate

    • Disturbance handler: managing an unexpected event or crisis, corrective action

    • Resource allocator: assigning resources between functions and divisions, setting budgets

    • Negotiator- reaching agreements between other managers, unions, customers, shareholders

  • Mintzberg’s managerial roles: interpersonal

    • Figurehead: symbolizing the organization mission and what it seeks to achieve

    • Leader: training counseling, mentoring- setting an example

    • Liaison- linking and coordinating the activities of people and groups both inside and outside the organization

  • Mintzberg’s managerial roles: informational

    • Monitor- analyzing information from internal and external environments

    • Disseminator- transmitting information to influence attitudes

    • Spokesperson- using information to positively influence the way people in and out of the organization respond to it

  • 3 levels of management

    • Ceo 

      • Chief executive officer- most important senior and important manager

    • Top managers

      • Responsible for all departments and have cross-departmental responsibility

    • Middle management

      • Supervise first-line managers

    • First line managers

      • Responsible for daily supervision of non-managerial employees

  • Department

    • A group of managers and employees who work together and possess similar skills or use the same knowledge, skills, techniques, tools

  • Managerial skills

    • Conceptual

      • Ability to analyze diagnose a situation and distinguish between cause and effect

    • Human 

      • The ability to understand alter, lead and control the behavior of other individuals and groups

    • Technical skills

      • Job specific skills required to perform a particular type of work or occupation at a high level

  • Restructuring

    • Simplifying , shrinking, downsizing an organization’s operations to lower operating costs

  • Outsourcing

    • Contracting with another company, usually in a low cost country abroad, to perform a work activity the company previously performed itself

    • Increases efficiency by lowering operating costs

  • Empowerment

    • Involved giving employees more authority and responsibility

  • Building competitive advantage

    • Ability of one organization to outperform the others because it produces desired goods or services more efficiently and effectively than its competitors

    • Increasing efficiency

      • Reduce quantity of resources used to produce goods

    • Increasing quality

      • Improve skills

    • Innovation

      • How fast a firm can bring new or improved products to market

      • How easily a firm can change or alter the way they perform their activities

      • Developing better ways to produce

    • Responsiveness to customers

Ethics and social responsibility

  • Ethics

    • Inner guiding moral principles, values, beliefs that people use to analyze or interpret a situation and then decide what is the right or appropriate way or behave

  • Ethical dilemma

    • Quandary people find themselves in when they have to decide if they should act in a way that might help another person or themselves even though doing so might go against their own or others self-interest

    • There are no absolute or indisputable rules or principles that can be developed to decide if an action is ethical or unethical

  • Ethics and the law

    • Neither laws nor ethics are fixed principles

    • Ethical beliefs lead to development of laws and regulations to prevent certain behaviors or encourage others

    • Laws can change or disappear as ethical beliefs change

  • Changes in ethics over time

    • Managers must confront the need to decide what is appropriate and inappropriate as they use a company's resources to produce goods and services

      • Must have more than their own interests in mind

  • Stakeholders and ethics

    • When the law does not specify how companies should behave, managers must decide what is the right thing to do

    • Stakeholders- 

      • People in groups affected by how a company and managers behave

      • Supply a company with its productive resources and have a claim on its resources

      • Mutually beneficial and dependent relationship 

    • Types 

      • Stockholders

        • Owners

        • Want to ensure that managers are behaving ethically and not risking investors capital by engaging in actions that could hurt the company’s reputation 

        • Want to maximize return on investment

        • Private companies/non-profits can NOT have stockholders

      • Managers

        • Responsible for using a company’s financial capital and human resources to increase performance

        • Have the right to expect a good return or reward by investing their human capital to improve a company's performance

        • Frequently juggle multiple interests

        • Layoffs of employees to reduce costs and benefit shareholders/stakeholders

        • Problem has been that in many company’s corrupt managers focus not on building the company's capital and stockholder wealth but on their own personal interests

      • Employees

        • Expect to receive rewards consistent with performance

        • Organizational structures with fair and equitable rewards for their employees show an ethical stance

      • Suppliers and distributors

        • Suppliers expect to be paid fairly and promptly for their inputs

        • Distributors expect to receive quality products at agreed upon prices

      • Customers

        • Most critical stakeholders

        • Company must work to increase efficiency and and effectiveness in order to create loyal customers and attract new ones

      • Community 

        • Physical locations like towns or cities in which companies are located

        • A community provides a company with the physical and social infrastructure that allows it to operate

        • A company contributes to the economy of the town or region through salaries, wages, taxes

  • Ethical decision making

  • JUMP:

    • Justice rule

      • Distribute benefits and harms equality

    • Utilitarian rule

      • Greatest good for greatest number of people

    • Moral rights rule

      • Golden rule

    • Practical rule

      • Manager should feel no shame telling others outside the company of actions

  • The relentless pursuit of self-interest can lead to a collective disaster when one or more people start to profit from being unethical because this encourages others to act in the same way

  • Unethical behavior destroys the trust between a company and its customers, suppliers, distributors

  • Trust

    • The willingness of one person or group to have faith or confidence in the goodwill of another person

  • Reputation

    • Esteem or high repute that individuals or organizations gain when they behave ethically

  • Effects of unethical behavior

    • Ethical 

      • Increases efficiency and effectiveness

      • Increases company performance

  • Societal ethics

    • Standards that govern how members of a society should deal with on another in matters involving issues such as fairness, justice, poverty, and individual rights

  • Occupational ethics

    • Standards that govern how members of a profession, trade, or craft should conduct themselves when performing work-related activities

      • Medical and legal ethics

      • Codes of ethics

  • Individual ethics

    • Personal standards and values that determine how people view their responsibilities to other people and groups

      • How they should act in situations where their own self-interests are at stake

  • Organizational ethics 

    • Guiding practices and beliefs through which a particular company and its managers view their responsibility toward their stakeholders

      • Top managers play a crucial role in determining a company’s ethics

  • Social responsibility

    • The way a company views its duty or obligation to make decisions that protect, enhance, and promote the welfare and well-being or stakeholders and society as a whole

    • 4 approaches

      • Obstructionist approach

        • Ignores social responsibility

      • Defensive approach

        • Abides by law, not ethics as much

      • Accommodative approach

        • Not illegal or unethical, try to balance interests of stakeholders as needs arise

      • Proactive approach

        • Actively embrace socially responsible behavior, going out of way to learn the needs of different stakeholders and utilizing organizational resources to promote all stakeholder interests

Effective groups and teams

  • Group

    • 2 or more ppl who interact with each other

  • Team

    • Group whos members work intensely together to achieve a common goal

    • All teams are groups but not all groups are teams

  • Advantage of synergy

    • People working in a group are able to produce more outputs than would have been produced if each person worked separately

    • To take advantage of the potential for synergy, managers need to make sure groups are composed of members who have complementary skills and knowledge relevant to the groups work

  • Responsiveness to customers 

    • Cross functional teams can produce the wide variety of skills needed to meet customer demands

      • Teams consist of different dep

  • Innovation

    • Creative development of new products, technologies, services, or organizational structures

      • Individuals rarely possess wide variety of skills needed for successful innovation

  • Motivations

    • Team members are often more motivated and satisfied than if youre working alone

    • Team members can see the effect of their contribution to achieving team and organizational goals

    • Teams provide motivation to work better

Formal group

  • Cross-functional teams

  • Composed of members from different departments

  • Can include members from different cultures/countries

Virtual teams

  • Team whos members rarely meet face-to-face

  • Interact using various forms of information technology

Self-managed team

  • Empowered to take responsibility for acting autonomously on identifiable pieces of work

  • The team’s task should be complex enough to include many different steps 

Informal groups

  • Groups that managers or non managerial employees form to achieve their own goals or to meet their own needs

    • Friend groups

    • Interest groups

  • Advantages of large groups

    • More resources

  • Disadvantages of large groups

    • Problems with communication/coordination

    • Lower motivation

    • Members might not think their efforts are needed

  • Group tasks impact how a group interacts

  • Pooled

    • Members make separate independent contributions to groups such that group performance is the sum of each members contribution

  • Reciprocal

    • Work performed by one group member is mutually dependent on work done by other members

  • Forming

    • Group members get to know each other

  • Storming

  • Norming

  • Performing 

    • Group begins real work

  • Adjourning

    • Only for tak forces that are temporary

  • Group norms

    • Shared guidelines for behavior

    • Managers should encourage members to develop norms that contribute to group performance and the attainment of group goals

  • Conformity and deviance

    • Members conform to norms to obtain rewards, imitate respected members, feel behavior is right

    • When member deviates, others will try to make them conform, expel member, change group norms

    • Conformity and deviance must be balanced for high performance

  • Group cohesiveness

    •  The degree to which members are attracted to their group 

    • 3 major consequences of cohesiveness

      • Level of participation

      • Level of conformity to norms

      • Emphasis on group goal accomplishment

  • Aphorism

    • Concise statement of a principle

  • Planning and strategy

    • planning

      • Identifying and selecting appropriate goals and course of action for an organization

    • Strategy

      • Cluster of decisions and actions that managers take to help an org reach its goals

    • mission statement

      • A broad declaration of an org’s overriding purpose

      • Identifies what is unique or important about its products

      • Seeks to distinguish between an organization and its competitors

      • Generally focuses on present

      • Who we are, what we do, why we do it

    • Why planning is important

      • Necessary to give org a sense of direction and purpose

      • Useful way of getting managers to participate in decision making

      • Helps coordinate managers of the different functions and divisions of an organization

      • Can be used as a device for controlling managers

    • 3 steps of planning

      • Determine mission/goals

      • Formulate strategy

      • Implement strategy

    • Corporate level plan

      • Top management's decisions concerning the organization’s mission and goals, overall (corporate-level) strategy, and structure

    • Division

      • Unit that has its own set of managers and depts and competes in distinct industry

    • Business level plan

      • Long term divisional goals that will allow the division to meet corporate goals

    • Functional level (depts)

      • Goals that the managers of each function will pursue to help their division attain its business-level goals, which, in turn, will allow the entire company to achieve its corporate goals.

    • Time horizons of plans

      • Time horizon

        • Period of time over which they are intended to apply or endure

          • Long term are 5 or more years

          • Intermediate term are 1 to 5 yrs

          • Short term are less than 1 yr

    • Scenario plan (contingency plan)

      • Generation of multiple forecasts of future conditions followed by an analysis of how to effectively respond to those conditions

    • Determining mission and goals

      • Defining the business

        • Who are the customers

        • What customer needs are being satisfied

        • How are we satisfying customers needs

          • OR

        • Who are we 

        • What do we do

        • How do we do it

      • Establishing major goals

        • Provides org with sense of direction

        • Stretches org to higher levels of performance

        • Must be challenging but realistic with a definite period in which they are to be achieved

      • Formulating strategy

        • Swot analysis

        • Planning exercise in which managers identify 

          • Organizational strengths/weaknesses

          • External opportunities/threats

  • The 5 forces

    • Level of rivalry

      • Increased competition results in lower profits

    • Potential for entry

      • Easy entry leads to lower prices and profits

    • Power of suppliers

      • If there are only a few suppliers of important items, supply costs rise

    • Power of customers

      • If there are only a few large buyers, they can bargain down prices

    • Substitutes 

      • More available substitutes tend to drive down prices and profits

    • Hypercompetition

      • Industries that are characterized by permanent, ongoing, intense, competition brought about by advancing technology or changing customer tastes and fads and fashions

    • Low-cost strategy

      • Driving the organization's total costs down below total costs of rivals

        • Manufacturing at lower costs, reducing waste

        • Lower costs than competition means that the low cost producer can sell for less and still be profitable

    • Focused low-cost

      • Serving only one market segment and being the lowest-cost organization serving that segment

    • Differentiation 

      • Distinguishing the organizations products from those of competitors on one or more important dimensions

        • Differentiation must be valued by the customer in order for a producer to charge more for a product

    • Focused differentiation

      • Serving only one market segment as the most differentiated organization serving that segment

    • “Stuck in the middle”

      • Attempting to simultaneously pursue both a low cost strategy and a differentiation strategy

      • Difficult to achieve low cost with the added costs of differentiation

    • Concentration in a single business

      • Organization uses its functional skills to develop new kinds of products or expand its locations

      • Appropriate when managers see the need to reduce the size of their organizations 

    • Vertical integration

      • Strategy that involves a company expanding its business operations wither backward into a new industry that produces inputs (backward vertical integration) or forward into a new industry that uses, distributes, or sells the company’s products (forward vertical integration)

    • Diversification

      • Strategy of expanding a company's business operations into a new industry in order to produce new kinds of valuable goods or services

    • Related diversification

      • Strategy of entering new industry and establishing a new business division that's linked to a company's existing divisions because they share resources that will improve competitive position

    • Synergy

      • Obtained when the value created by two divisions cooperating is greater than the value that would be created if the two divisions operated separately and independently

    • Unrelated diversification

      • Firms establish divisions or buy companies in new industries that are not linked in any way to their current businesses or industries.