Management Practice 4

Module 4: Management functions

Module 4: Management functions After completing this module, you will be able to: apply the decision-making process to make a managerial decision apply the general management functions to a selected organisation

After completing this module, you will be able to:

apply the decision-making process to make a managerial decision

apply the general management functions to a selected organisation

1. APPLY THE DECISION-MAKING PROCESS TO A MANAGEMENT DECISION After completing this outcome, you will be able to: Explain the steps to be followed in making a decision with reference to authentic workplace situation Use the decision-making process to make a management decision Compile a written report on the result of the management decision taken

After completing this outcome, you will be able to:

Explain the steps to be followed in making a decision with reference to authentic workplace situation

Use the decision-making process to make a management decision

Compile a written report on the result of the management decision taken

Introduction The managing process consists of 4 functions: Planning Organising Leading Controlling Decision-making is a central aspect of all four fundamental management functions Successful organisations “out-decide” their competitors in at least three ways: they make better decisions they make decisions faster they implement decisions more

The managing process consists of 4 functions:

Planning

Organising

Leading

Controlling

Decision-making is a central aspect of all four fundamental management functions

Successful organisations “out-decide” their competitors in at least three ways:

they make better decisions

they make decisions faster

they implement decisions more

Decision-making A decision implies that managers are faced with either a threat or an opportunity The course of history has been shaped by decisions

A decision implies that managers are faced with either a threat or an opportunity

The course of history has been shaped by decisions

Types of managerial decisions Programmed Structured Unprogrammed Unstructured

Activity 1 Are the following decisions an example of a programmed or non-programmed decision? McDonalds had to pay wages at the end of the month. McDonalds decide to enter a new market. McDonalds decide to re-engineer their cheese burger, that was for more than ten years on the market, with excellent sales over the years McDonalds want to add scones with strawberry jam and cream to their menu. McDonalds decide to continue with their “drive-thru” section – after concerns about the effect of the fuel price on this section.

Are the following decisions an example of a programmed or non-programmed decision?

McDonalds had to pay wages at the end of the month.

McDonalds decide to enter a new market.

McDonalds decide to re-engineer their cheese burger, that was for more than ten years on the market, with excellent sales over the years

McDonalds want to add scones with strawberry jam and cream to their menu.

McDonalds decide to continue with their “drive-thru” section – after concerns about the effect of the fuel price on this section.

Decision-making conditions Certainty Risk Uncertainty Outcome of options predictable Outcome of options unpredictable

Probability Objective probability Based on historical evidence Subjective probability Historical evidence not available

Objective probability

Based on historical evidence

Subjective probability

Historical evidence not available

Decision-making conditions and levels of uncertainty Certainty Risk Uncertainty Decision maker has complete certainty Decision maker has some certainty Decision maker has complete uncertainty Available options and the benefits or costs of each are known Outcome of each alternative is not known in advance Outcome of each alternative is unpredictable No element of change intervenes between the option and its outcome Probability can be assigned to each alternative outcome Probability cannot be assigned to each alternative outcome Decision is a sure thing Decision is a “gamble” Decision requires “guts” or based on your “gut feeling”

Activity 2 If you are the manager of a McDonald’s franchise nearby you, lists the decisions that you will make. Divide these decisions into decisions where the outcome is certain, decisions where there is risk involved (and mention the risk) and decisions with a lot of uncertainty.

If you are the manager of a McDonald’s franchise nearby you, lists the decisions that you will make.

Divide these decisions into decisions where the outcome is certain, decisions where there is risk involved (and mention the risk) and decisions with a lot of uncertainty.

1.1 Use the decision-making process to make a management decision Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Stage 6 Stage 7 Recognise, classify and define the problem or opportunity Set goals and criteria Generate creative alternative courses of action Evaluate alternative courses of action Select the best option Implement the chose option Conduct follow up evaluation Group decision making Quantitative tools – Cost benefit analysis

Activity 3 Ask somebody to bring a copy of a McDonald’s menu – if the facilitator has access to a menu, bring it for the learners to study Divide into groups of 3 – 5 members and discuss changes to the menu Write down your decision-making process that you followed in the changing of the menu

Ask somebody to bring a copy of a McDonald’s menu – if the facilitator has access to a menu, bring it for the learners to study

Divide into groups of 3 – 5 members and discuss changes to the menu

Write down your decision-making process that you followed in the changing of the menu

2. APPLY THE GENERAL MANAGEMENT FUNCTIONS TO A SELECTED ORGANISATION After completing this outcome, you will be able to: List the management functions in an organisation Identify who in the organisation is responsible for each function Explain the way in which each management function is addressed in an organisation, with reference to the organogram Outline the role of the team leader or low level manager in the management of an organisation with reference to the basic management functions and tasks Explain the advantages and disadvantages of different styles of leadership Describe the application of the various leadership styles Identify the leadership style evident in an organisation according to the organogram with examples

After completing this outcome, you will be able to:

List the management functions in an organisation

Identify who in the organisation is responsible for each function

Explain the way in which each management function is addressed in an organisation, with reference to the organogram

Outline the role of the team leader or low level manager in the management of an organisation with reference to the basic management functions and tasks

Explain the advantages and disadvantages of different styles of leadership

Describe the application of the various leadership styles

Identify the leadership style evident in an organisation according to the organogram with examples

Management functions Organising Controlling Planning Leading Resources Human Financial Physical Information Performance Achieve goals Products Services Productivity Profit

Effective planning

Steps in the control process Standards Supervision Input resources Output results Conditions Conversion process (Activities and conditions) Output results

Steps in the control process

How decision making and management functions link Planning and decision making Managers determine the organisation’s vision, mission and goals and decide on a strategy to achieve them Leading Managers direct and motivate members of the organisation to achieve the mission and goals Organising Manager’s group activities together, establish authority, allocate resources and delegate Controlling Managers monitor progress and take corrective steps to reach the mission and goals

How the four functions of management differ for the three management levels

Activity 4 Group discussion between the facilitator and the learners Visualise a McDonald’s Franchise – make a list of all the possible staff positions Draw a rough diagram to illustrate the different managerial positions of the McDonald's List the responsibilities of each position in McDonald's

Group discussion between the facilitator and the learners

Visualise a McDonald’s Franchise – make a list of all the possible staff positions

Draw a rough diagram to illustrate the different managerial positions of the McDonald's

List the responsibilities of each position in McDonald's

The importance of leadership Survey results have revealed that academics and practitioners alike agree that leadership is the most important topic within the realm of organisational behaviour. According to a leadership study of more than 25 000 employees, 69% of employee job satisfaction stems from the leadership skills of the employee’s manager. The major reason for employee failure is poor leadership. Management experts believe that leadership could be the number one strategic concern of business in the twenty-first century.

Survey results have revealed that academics and practitioners alike agree that leadership is the most important topic within the realm of organisational behaviour. According to a leadership study of more than 25 000 employees, 69% of employee job satisfaction stems from the leadership skills of the employee’s manager. The major reason for employee failure is poor leadership. Management experts believe that leadership could be the number one strategic concern of business in the twenty-first century.

Important aspects of successful leadership Leaders deal with followers or individuals in the organisation, and unless they understand the basic behaviour of followers and the relationship between followers and the organisation, they will not be able to exercise their leadership role effectively. The leader will find that he or she also has groups as followers in the organisation Leadership is often defined as the management function that activates people to things willingly. This means that leaders must know how to motivate their followers. Leaders have to communicate their vision, strategies, and expectations to followers.

Leaders deal with followers or individuals in the organisation, and unless they understand the basic behaviour of followers and the relationship between followers and the organisation, they will not be able to exercise their leadership role effectively.

The leader will find that he or she also has groups as followers in the organisation

Leadership is often defined as the management function that activates people to things willingly. This means that leaders must know how to motivate their followers.

Leaders have to communicate their vision, strategies, and expectations to followers.

Different styles of leadership

Activity 5 In your groups, decide on the leadership style for a McDonald's Write down the qualities and characteristics of such leadership style Write down , one or two, key points/qualities a McDonald's manager should have to make a success of his franchise

In your groups, decide on the leadership style for a McDonald's

Write down the qualities and characteristics of such leadership style

Write down , one or two, key points/qualities a McDonald's manager should have to make a success of his franchise