GLOBAL MANAGMENT 200-Notes

Forecasting

• Attempts to predict the future

• Qualitative forecasting uses expert opinions

• Quantitative forecasting uses mathematical models and statistical analysis of historical data and surveys

  • Example: Focus groups predicting consumer trends.

  • Example: Netflix’s recommendation engine using viewing data.

Organizations

• A collection of people working together to achieve a common purpose

• Organizations provide goods and services of value to customers and clients, and seek to serve society

Benchmarking

• Use of external and internal comparisons to better evaluate current performance

• Adopting best practices: things people and organizations do that lead to superior performance

  • Example: Toyota’s lean manufacturing inspires global industries.

Planning

• Planning

  • The process of setting objectives and determining how best to accomplish them

Types of planning 

• Strategic Plans: 

  • A long-term version of contingency planning

  • Identifying alternative future scenarios

  • Plans made for each future scenario

  • Increases organization’s flexibility and preparation for future shocks

    • Example: Microsoft’s vision to lead in AI development.

• Vision: 

  • clarifies the purpose of the organization and what it hopes to be in the future

• Tactical Plans: 

  • Medium-term, departmental strategies.

  • specify how the organization’s resources are used to implement the strategy

    • Example: Starbucks' focus on mobile ordering to increase sales.

• Operational Plans: 

  • Day-to-day implementation.

  • describe short-term activities to implement strategic plans

    • Policies are standing plans that communicate guidelines for decisions

    • Procedures are rules that describe actions to be taken in specific situations

    • Budgets are single-use plans that commit resources to projects or activities

    • Zero-based budgets allocate resources as if each budget were brand new

  • Example: Disney’s park operations for crowd management.

• Functional Plans: 

  • Specific areas like marketing or HR.

  • indicate how different components within the organization will help accomplish the overall strategy

    • Production plans

    • Financial plans

    • Facilities plans

    • Logistics plans

    • Marketing plans

    • Human resource plans

Example: Coca-Cola’s campaigns are tailored to regional tastes.

• Scenario Planning: Adapts to potential futures.

  • Example: BP’s scenarios for renewable energy market growth.

 Strategy

• Strategy: a comprehensive plan guiding resource allocation to achieve long-term organizational goals

Global Strategies

• Globalization strategy: The World is one large market; standardize products and

• advertising as much as possible (Apple)

• Multi-domestic strategy: Customize products and advertising to local markets as much as possible (Mcdonald's)

• Transnational strategy: Balance efficiencies in global operations and responsiveness to local markets (Samsung)

Scenario planning

• A long-term version of contingency planning

• Identifying alternative future scenarios

• Plans made for each future scenario 

• Increases organization’s flexibility and preparation for future shocks

Human capital 

• The economic value of people with job relevant knowledge, abilities, ideas, energies, commitments and skillsc plan

Policies - 

• A policy communicates broad guidelines for making decisions and taking action in specific circumstances 

• Organizations operate with lots of policies that set expectations for many aspects of employee behaviour 

• Human resource policies cover things like: hiring, termination, performance, pay increases, etc 

Short vs long-term plan

Short-term vs. Long-term plans

• Short term–Most of us

  • 3 month time frame

• A few of us

  • 1-year time frame

• Long-term—Very few of us

  • 20-year time frame

Decision making

Decision-making process 

• A process that begins with the identification of a problem and ends with the evaluation of results 

Classical decision

• Views the manager as acting rationally in a certain world

• The assumption is that a rational choice of the pressered course of action is being made by a decison maker who is fully informed of all possible alternatives 

Entrepreneurship

• Strategic thinking and risk taking behaviour in business that results in new opportunities

• Classic entrepreneurship - A risk taking individual who pursue opportunities others fail to recongnize, or may even view as problems or threats 

Social entrepreneurship

• Unique form of ethical entrepreneurship that seeks novel ways to solve pressing social problems

• Social entrepreneurs

  • take risks to help meet needs not being effectively served by government and the private sector, such as poverty, illiteracy, illness, homelessness

First mover advantage

• First-mover advantage

• First to exploit a niche or enter a new maket

Franchise/ startup/family owned

• Starting a small business

• Franchise: One business owner sells to another the right to operate the same business in another location

• Business model: Plan for making a profit by generating revenues that are greater than costs

• Startup: New and temporary venture that is trying to establish a profitable business model

• Lean startups: Use open source software and free web services to contain costs while staying small and keeping operations simple

Characteristics of entrepreneurial

• Creativity,

•  Passion,

•  self-confidence, 

• risk-taking, 

• adaptability, 

• vision, strong work ethic, resilience, decisiveness, strong communication skills, a drive to innovate, and the ability to motivate others

Failure of entrepreneurial

Structure / non structure problems

• Structured Problems: Clear and familiar issues that can be solved with existing solutions.

• Unstructured Problems: Ambiguous, unclear problems that require unique solutions

Stages of entrepreneurship

Tariffs

• A tax imposed on imports 

EUropean union

•  These alliances, such as NAFTA (USMCA), the EU, APEC, ASEAN, and SADC, promote economic cooperation and trade by reducing barriers between member countries.

• Real-life Example: European Union (EU) — Companies like IKEA benefit from the EU's single market, which allows the free flow of goods, services, capital, and labour across member countries without tariffs, enabling efficient operations.

Visionary participative leadership

• Visionary leadership: A leader who brings to the situation a clear and compelling sense of the future, as well as an understanding of the actions needed to get there successfully

Competitive advantage

Competitive advantage - Something that an organization does extremely well and is difficult to copy and gives it an advantage over competitors in the marketplace 

Areas of competitive advantage

• Costs-, finding ways and using technology to operate with lower costs than competitors, and earning profits with prices that competitors have difficulty with matching 

• Quality- finding ways and using technology to create products and services that are consistentl higher quality than competitors offer

• Delivery - Finding ways and using technology to outperform competitors by delivering products and services to customers faster and more consistently on time, by developing timely new products 

• Flexibility - Using technology to adjust and tailor products and services to fit customer needs in ways that are difficult or expensive for competitors to match 

Swot analysis

• SWOT Analysis:

  • Internal

    • Strengths: Unique IP like Disney’s animation.

    • Weaknesses: High operating costs at traditional airlines.

  • External

    • Opportunities: Green energy investments by Shell.

    • Threats: Regulatory changes in tech affecting Meta.

Cage analysis

• Cultural – English spoken by less than 10%; “Ubuntu”

• Administrative – Union

• Geographic – Climate

• Economic – GDP

Potters analysis

• Threat of new entrants

• Bargaining power of buyers

• Bargaining power of suppliers

• Threat of new substitutes

• Competitive rivalry

Mission statement

• Analysis of mission:

  • The reason for an organization’s existence

Good mission statements identify:

• What are we moving to?

• What is our dream?

• What kind of difference do we make?

• What do we want to be known for?

BCG matrix

• BCG Matrix analyzes business opportunities according to market growth rate and market share

• BCG Matrix: Evaluates market share and growth.

  • Stars: High growth and market share (e.g., Apple’s iPhone).

  • Cash Cows: Stable products (e.g., Microsoft Office).

  • Question Marks: Uncertain potential (e.g., new AI tools).

  • Dogs: Low growth and share (e.g., older legacy software).

Matrix structure

• Combines functional and divisional structures to gain advantagesnand minimize disadvantages of each

• Used in: Manufacturing | Service industries | Professional fields |Non-profit sector | Multi-national corporations

Potential advantages of matrix structures:

• Better cooperation across functions

• lmproved decision-making / Increased flexibility in restructuring

• Better customer service

• Better performance accountability

• Improved strategic management

Potential disadvantages of matrix structures:

• Two-boss system is susceptible to power struggles

• Two-boss system can create task confusion and conflict in work priorities

• Team meetings are time consuming

• Team may develop “groupitis ”

• increased costs due to adding team leaders to structure

Formal vs informal network

Functional structure

• People with similar skills and performing similar tasks are

• grouped together into formal work units

• Members work in their functional areas of expertise

• Work well for small organizations producing few products or services

Divisional structure

• Group together people who work on the same product or process, serve similar customers, and/or are located in the same area or geographical region

  • Common in complex organizations

  • Avoid problems associated with functional structures

Various types of power

• Sources of position power:

  • Reward power - Capability to offer something of value. Its the capacity to offer something of value 

  • Coercive power - Capability to punish or withhold positive outcomes

  • Legitimate power - Organizational position or status confers the right to control those in subordinate positions

• Sources of personal power:

  • Expert Power

  • Information and Networking Power

  • Referent Power

Maslows

• A satisfied need is not a motivator of behaviour

• A need becomes a motivator once the preceding lower-level need is satisfied

• Both principles cease to operate at self-actualizationlevel

Mcgregor's theory

• McGregor’s Theory X and Y

• Theory X assumes that workers:

  • Dislike worker

  • Lack ambition

  • Are irresponsible

  • Resist change

  • Prefer to be led

• Theory Y assumes that workers are:

  • Willing to work

  • Willing to accept responsibility

  • Capable of self control

  • Capable of self-direction

  • Imaginative and creative

thinking/theory

Evidence based management

Total quality management

• Total quality management (TQM)

• Comprehensive approach to continuous improvement for the total organization

Millennials (how they work)

• Millennials and Management

• Principle: Millennials value a flat management structure, work-life balance, and flexibility, and seek leadership that empowers and supports feedback.

Ethics

• Code of moral principles that set standards of conduct of what is “good” and “right”, as well as “bad” and “wrong”

  • An individual behaviour

  • In business practices

Different elements of origanization

Intellectual and social capital

• Intellectual capital is the combined brainpower and shared knowledge of an organization’s employees

• Social Capital Capacity to attract support and help from others

Classical management (approaches of classical management, scientific, administrative,

Scientific Management (Frederick Taylor)

• Principle: Develop a "science" for each job, selecting the right workers, and training them with incentives.

• Example: In a manufacturing plant, applying Taylor's principles would involve analyzing each step of an assembly line to reduce wasted motion and increase efficiency. Workers are trained to follow the standardized process, leading to higher productivity. Companies like Ford in the early 20th century used these principles to revolutionize car production.

Administrative Principles (Henri Fayol)

• Principles of management:

• Foresight: Planning for the future.

• Organization: Mobilizing resources.

• Command: Leading and evaluating workers.

• Coordination: Ensuring efforts fit together.

• Control: Monitoring and taking corrective action.

• Example: A tech startup plans a product launch. They need foresight to predict market demand, organize a team of engineers and marketers, coordinate the various departments, and control the quality of the product. If the product faces issues during testing, the company takes corrective actions to fix problems before release.

Bureaucratic Organization (Max Weber)

• Principle: An ideal organization based on hierarchy, rules, and clear authority.

• Example: Government organizations like the DMV or large corporations like IBM traditionally operate with clear hierarchical structures and strict procedures. While this ensures order, it can sometimes lead to inefficiency and rigidity (e.g., delays in processing paperwork due to excessive formalities).

Globalization

• The worldwide interdependence of resource flows, product markets, and business competition that characterize our economy

• Job migration occurs when firms shift jobs fromone country to another

Reshoring is the shifting of manufacturing and jobs back home from overseas

Culture

• The shared set of beliefs, values, and patterns of behavior common to a group of people

Cost

Career

Human capital

Work-life balance

Management functions

• Planning

  • The process of setting objectives anddetermining what actions should be taken to accomplish them

• Organizing

  • The process of assigning tasks, allocating resources, and coordinating work activities

• Leading

  • The process of arousing people’s enthusiasm and inspiring them to work hard to achieve goals

• Controlling

  • The process of measuring work performance, comparing results, and taking corrective action

Planning controlling and leading

Types of planning

Types of Plans

• Strategic Plans: 

  • A long-term version of contingency planning

  • Identifying alternative future scenarios

  • Plans made for each future scenario

  • Increases organization’s flexibility and preparation for future shocks

    • Example: Microsoft’s vision to lead in AI development.

• Vision: 

  • clarifies the purpose of the organization and what it hopes to be in the future

• Tactical Plans: 

  • Medium-term, departmental strategies.

  • specify how the organization’s resources are used to implement the strategy

    • Example: Starbucks' focus on mobile ordering to increase sales.

• Operational Plans: 

  • Day-to-day implementation.

  • describe short-term activities to implement strategic plans

    • Policies are standing plans that communicate guidelines for decisions

    • Procedures are rules that describe actions to be taken in specific situations

    • Budgets are single-use plans that commit resources to projects or activities

    • Zero-based budgets allocate resources as if each budget were brand new

  • Example: Disney’s park operations for crowd management.

• Functional Plans: 

  • Specific areas like marketing or HR.

  • indicate how different components within the organization will help accomplish the overall strategy

    • Production plans

    • Financial plans

    • Facilities plans

    • Logistics plans

    • Marketing plans

    • Human resource plans

  • Example: Coca-Cola’s campaigns are tailored to regional tastes.

Planning Process

1. Define your objectives - Specifically, identify your desired outcomes or results. Know where you want to go, and be specific about it so you know when you have achieved that goal or when you are far off the mark

2. Determine where you stand - Evaluate your current accomplishments relative to the desired the results. Know where you stand in reaching objectives. Know what strengths work in your favour and what weaknesses hold you back

3.  Develop premises regarding future conditions - Anticipate future events and generate alternative scenarios for what may happen in the future. For each scenario identify things that will help or hinder progress towards your objectives 

4. Analyze alternatives and make a plan - List and evaluate possible actions. Choose the alternative that is most likely to accomplish your objectives 

5. Implement the plan and evaluate results - Take action and carefully measures your progress towards objectives. Follow through by doi

Plan

Classic leadership styles:

• Autocratic style: Emphasizes task over people

• Human relations style: Emphasizes people over task

• Laissez-faire style: Shows little concern for task

Democratic style: Committed to both task and pe