The document summarizes key concepts from Chapter 1 of a management textbook. It discusses the definition of management as planning, organizing, leading and controlling resources to achieve goals efficiently and effectively. It also outlines the four main managerial functions and explains the roles of different levels of managers. Finally, it discusses challenges managers face in a global environment like maintaining ethics and building competitive advantage.

1. Chapter
1
PowerPoint Presentation by Charlie Cook
© Copyright The McGraw-Hill Companies, Inc., 2004. All rights reserved.
The Management Process
Essentials of
Contemporary
Management

2. © Copyright 2004 McGraw-Hill. All rights reserved . 1–2
Learning Objectives
• After studying the chapter, you should be able to:
Describe what management is, why management is
important, what managers do, and how managers
utilize organizational resources efficiently and
effectively to achieve organizational goals.
Distinguish among planning, organizing, leading,
and controlling (the four managerial functions), and
explain how managers’ ability to handle each one can
affect organizational performance.

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Learning Objectives (cont’d)
Differentiate among three levels of management,
and understand the responsibilities of managers at
different levels in the organizational hierarchy.
Identify the roles managers perform, the skills
they need to execute those roles effectively and the
way new information technology is affecting these
roles and skills.
Discuss the principal challenges managers face in
today’s increasingly competitive global environment.

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What Is Management?
• Management
The planning, organizing, leading, and controlling
of human and other resources to achieve
organizational goals effectively and efficiently.
• Managers
The people responsible for supervising the use of
an organization’s resources to meet its goals.
• Resources are organizational assets
People Skills Knowledge Information
Raw materials Machinery Financial capital

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Efficiency, Effectiveness, and Performance in an Organization
Figure 1.1

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Organizational Performance
• Organizational Performance
A measure of how efficiently and effectively
managers are using organizational resources to
satisfy customers and achieve 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.
To get the right things done!
To do the things right!

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Why Study Management?
• Proper management directly impacts
improvements in the well-being of a society.
• Studying management helps people to
understand what management is and
prepares them accomplish managerial
activities in their organizations.
• Studying management opens a path to a well-
paying job and a satisfying career.

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Four Functions of Management
Figure 1.2

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Managerial Functions
• Henri Fayol
First outlined the four managerial functions in his
book General Industrial Management.
Managers at all levels in all organizations perform
each of the functions of planning, organizing,
leading, and controlling.

10. © Copyright 2004 McGraw-Hill. All rights reserved . 1–10
Planning
• Identifying and selecting appropriate goals
and courses of action for an organization.
The planning function determines how effective and
efficient the organization is and determines the
strategy of the organization.
• Three Steps in the Planning Process:
Deciding which goals to pursue.
Deciding what courses of action to adopt.
Deciding how to allocate resources.

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Management Key Concepts
• Organization
People working together and coordinating their
actions to achieve specific goals.
• Goal/objective
A desired future condition that the organization
seeks to achieve.
• Strategy
A cluster of decisions about what goals to pursue,
what actions to take, and how to use resources to
achieve goals.
c.f. policy

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Organizing
• Structuring working relationships in a way
that allows organizational members to work
together to achieve organizational goals.
• Organizational Structure
A formal system of task and reporting
relationships that coordinates and motivates
organizational members.
Creating organizational structure:
• Grouping employees into departments according to
the tasks performed.
• Laying out lines of authority and responsibility for
organizational members.

13. © Copyright 2004 McGraw-Hill. All rights reserved . 1–13
Leading
• Articulating a clear vision to follow, and
energizing and enabling organizational
members so they understand the part they
play in attaining organizational goals.
Leadership involves using power, influence, vision,
persuasion, and communication skills.
The outcome of leadership is highly motivated and
committed organizational members.

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Controlling
• Evaluating how well an organization is
achieving its goals and taking action to
maintain or improve performance.
Monitoring individuals, departments, and the
organization to determine if desired performance
standards have been reached.
Taking action to increase performance as required.
The outcome of control is the ability to measure
performance accurately and to regulate the
organization for efficiency and effectiveness.

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Types of Managers
• Levels of Management
First-line managers
• Responsible for day-to-day operations. Supervise people
performing activities required to make the good or service.
Middle managers
• Supervise first-line managers. Are responsible to find the
best way to use departmental resources to achieve goals.
Top managers
• Responsible for the performance of all departments and
have cross-departmental responsibility.
• Establish organizational goals and monitor middle
managers.
• Form top management team along with the CEO and COO.

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Levels of Management
Figure 1.3

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Relative Amount of Time That Managers
Spend on the Four Managerial Functions
Figure 1.4

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IT and Managerial Roles and Skills
• Information Technology (IT) is increasingly
used to help managers adopt a cross-
departmental view of their organization.
• Managerial Role
The set of specific tasks that a person is expected
to perform because of the position he or she holds
in the organization.
• Roles are defined into three role categories (as
identified by Mintzberg):
Interpersonal  Informational  Decisional

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Decisional Roles
• Roles associated with methods managers use
in planning strategy and utilizing resources:
Entrepreneur—deciding which new projects or
programs to initiate and to invest resources in.
Disturbance handler—managing an unexpected
event or crisis.
Resource allocator—assigning resources between
functions and divisions, setting the budgets of
lower managers.
Negotiator—reaching agreements between other
managers, unions, customers, or shareholders.

20. © Copyright 2004 McGraw-Hill. All rights reserved . 1–20
Informational Roles
• Roles associated with the tasks needed to
obtain and transmit information in the process
of managing the organization:
Monitor—analyzing information from both the
internal and external environment.
Disseminator—transmitting information to
influence the attitudes and behavior of employees.
Spokesperson—using information to positively
influence the way people in and out of the
organization respond to it.

21. © Copyright 2004 McGraw-Hill. All rights reserved . 1–21
Interpersonal Roles
• Roles that managers assume to provide
direction and supervision to both employees
and the organization as a whole:
Figurehead—symbolizing the organization’s
mission and what it is seeking to achieve.
Leader—training, counseling, and mentoring high
employee performance.
Liaison—linking and coordinating the activities of
people and groups both inside and outside the
organization/department.

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Being a Manager
Brevity
High Variety Fragmentation
Managerial
Problems
Compensation to be a manager

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Managerial Skills
• Conceptual Skills
The ability to analyze and diagnose a situation and
distinguish between cause and effect.
• Human Skills
The ability to understand, alter, lead, and control
the behavior of other individuals and groups.
• Technical Skills
The specific knowledge and techniques required to
perform an organizational role.
What should be the right thing?
How can we do better?

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Skill Types Needed by Managerial Level

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Challenges for Management
in a Global Environment
• Increasing Number of Global Organizations.
• Building a Competitive Advantage.
• Maintaining Ethical Standards.
• Managing a Diverse Workforce.
• Utilizing IT and E-commerce.

26. © Copyright 2004 McGraw-Hill. All rights reserved . 1–26
Building a Competitive Advantage
• Increasing Efficiency
Reducing the quantity of resources used to produce
goods and services.
• Increasing Quality
Introducing Total Quality Management (TQM) to
improve quality.
• Increasing Speed, Flexibility, and Innovation
Adapting to bring new products to market faster.
• Increasing Responsiveness to Customers
Empowering employees to deal with customers.

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Building Blocks of Competitive Advantage
Figure 1.5

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Maintaining Ethical Standards
• Factors Influencing Behaviors:
External pressures from stockholders/stakeholders
for increased organizational financial performance.
Internal pressures from top management to lower-
level managers to increase the organization’s
competitive performance and profitability.
Societal, cultural, and environment demands on the
organization.
Hurt somebody unintendedly vs. illegally

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Managing a Diverse Workforce
• The Increasing Diversity of the Workforce
• Non-Discriminatory Employment Practices
• Performance-Enhancing Benefits of a Diverse
Workforce
The opportunities for specialization

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Utilizing Information Technology (IT)
and E-commerce
• Benefits of IT and E-commerce
Makes more and better information about the
organization available to outsiders
Empowers employees at all organizational levels
Helps managers carry out their roles more
effectively and efficiently
Increases awareness of competitive opportunities
Makes the organization more responsive to its
customers

31. © Copyright 2004 McGraw-Hill. All rights reserved . 1–31
Readings on the historical management gurus
• Appendix A of chapter 1
• Brief the management thoughts