Management

ChapterChapter
11
ChapterChapter
11
PowerPoint Presentation by Charlie Cook
© Copyright The McGraw-Hill Companies, Inc., 2004. All rights reserved.
The Management ProcessThe Management ProcessThe Management ProcessThe Management Process
Essentials of
Contemporary
Management

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

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

What Is Management?What Is Management?What Is Management?What Is Management?
• ManagementManagement
The planning, organizing, leading, and controlling ofThe planning, organizing, leading, and controlling of
human and other resources to achievehuman and other resources to achieve
organizational goals effectively and efficiently.organizational goals effectively and efficiently.
• ManagersManagers
The people responsible for supervising the use ofThe people responsible for supervising the use of
an organization’s resources to meet its goals.an organization’s resources to meet its goals.
• Resources are organizationalResources are organizational assetsassets
PeoplePeople SkillsSkills KnowledgeKnowledge
InformationInformation
Raw materialsRaw materials MachineryMachinery Financial capitalFinancial capital

Efficiency, Effectiveness, and Performance in an OrganizationEfficiency, Effectiveness, and Performance in an OrganizationEfficiency, Effectiveness, and Performance in an OrganizationEfficiency, Effectiveness, and Performance in an Organization
Figure 1.1

Organizational PerformanceOrganizational PerformanceOrganizational PerformanceOrganizational Performance
• Organizational PerformanceOrganizational Performance
A measure of how efficiently and effectivelyA measure of how efficiently and effectively
managers are using organizational resources tomanagers are using organizational resources to
satisfy customers and achieve goals.satisfy customers and achieve goals.
• EfficiencyEfficiency
A measure of how well or productively resourcesA measure of how well or productively resources
are used to achieve a goal.are used to achieve a goal.
• EffectivenessEffectiveness
A measure of the appropriateness of the goals anA measure of the appropriateness of the goals an
organization is pursuing and the degree to whichorganization is pursuing and the degree to which
they are achieved.they are achieved.
To get the right things done!
To do the things right!

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

Four Functions of ManagementFour Functions of ManagementFour Functions of ManagementFour Functions of Management
Figure 1.2

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

PlanningPlanningPlanningPlanning
• Identifying and selecting appropriateIdentifying and selecting appropriate goalsgoals
and courses of action for anand courses of action for an organizationorganization..
The planning function determines how effective andThe planning function determines how effective and
efficient the organization is and determines theefficient the organization is and determines the
strategystrategy of the organization.of the organization.
• Three Steps in the Planning Process:Three Steps in the Planning Process:
Deciding which goals to pursue.Deciding which goals to pursue.
Deciding what courses of action to adopt.Deciding what courses of action to adopt.
Deciding how to allocate resources.Deciding how to allocate resources.

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

OrganizingOrganizingOrganizingOrganizing
• StructuringStructuring working relationshipsworking relationships in a wayin a way
that allows organizational members to workthat allows organizational members to work
together to achieve organizational goals.together to achieve organizational goals.
• Organizational StructureOrganizational Structure
AA formalformal system of task and reporting relationshipssystem of task and reporting relationships
that coordinates and motivates organizationalthat coordinates and motivates organizational
members.members.
Creating organizational structure:Creating organizational structure:
• Grouping employees intoGrouping employees into departmentsdepartments according toaccording to
the tasks performed.the tasks performed.
• Laying out lines ofLaying out lines of authorityauthority andand responsibilityresponsibility forfor
organizational members.organizational members.

LeadingLeadingLeadingLeading
• Articulating a clearArticulating a clear visionvision to follow, andto follow, and
energizingenergizing and enabling organizationaland enabling organizational
members so they understand the part theymembers so they understand the part they
play in attaining organizational goals.play in attaining organizational goals.
Leadership involves using power, influence, vision,Leadership involves using power, influence, vision,
persuasion, and communication skills.persuasion, and communication skills.
The outcome of leadership is highly motivated andThe outcome of leadership is highly motivated and
committed organizational members.committed organizational members.

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

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

Levels of ManagementLevels of ManagementLevels of ManagementLevels of Management
Figure 1.3

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

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

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

Informational RolesInformational RolesInformational RolesInformational Roles
• Roles associated with the tasks needed toRoles associated with the tasks needed to
obtain and transmit information in the processobtain and transmit information in the process
of managing the organization:of managing the organization:
MonitorMonitor—analyzing information from both the—analyzing information from both the
internal and external environment.internal and external environment.
DisseminatorDisseminator —transmitting information to—transmitting information to
influence the attitudes and behavior of employees.influence the attitudes and behavior of employees.
SpokespersonSpokesperson—using information to positively—using information to positively
influence the way people in and out of theinfluence the way people in and out of the
organization respond to it.organization respond to it.

Interpersonal RolesInterpersonal RolesInterpersonal RolesInterpersonal Roles
• Roles that managers assume to provideRoles that managers assume to provide
direction and supervision to both employeesdirection and supervision to both employees
and the organization as a whole:and the organization as a whole:
FigureheadFigurehead—symbolizing the organization’s—symbolizing the organization’s
mission and what it is seeking to achieve.mission and what it is seeking to achieve.
LeaderLeader—training, counseling, and mentoring high—training, counseling, and mentoring high
employee performance.employee performance.
LiaisonLiaison—linking and coordinating the activities of—linking and coordinating the activities of
people and groups both inside and outside thepeople and groups both inside and outside the
organization/department.organization/department.

Being a ManagerBeing a ManagerBeing a ManagerBeing a Manager
BrevityBrevityBrevityBrevity
High VarietyHigh VarietyHigh VarietyHigh Variety FragmentationFragmentationFragmentationFragmentation
ManagerialManagerial
ProblemsProblems
ManagerialManagerial
ProblemsProblems
Compensation to be a manager

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

Skill Types Needed by ManagerialSkill Types Needed by Managerial
LevelLevel
Skill Types Needed by ManagerialSkill Types Needed by Managerial
LevelLevel

Challenges for ManagementChallenges for Management
in a Global Environmentin a Global Environment
Challenges for ManagementChallenges for Management
in a Global Environmentin a Global Environment
• Increasing Number of Global Organizations.Increasing Number of Global Organizations.
• Building a CompetitiveBuilding a Competitive AdvantageAdvantage..
• MaintainingMaintaining EthicalEthical Standards.Standards.
• Managing aManaging a DiverseDiverse Workforce.Workforce.
• UtilizingUtilizing ITIT and E-commerce.and E-commerce.

Building a Competitive AdvantageBuilding a Competitive AdvantageBuilding a Competitive AdvantageBuilding a Competitive Advantage
• IncreasingIncreasing EfficiencyEfficiency
Reducing the quantity of resources used to produceReducing the quantity of resources used to produce
goods and services.goods and services.
• IncreasingIncreasing QualityQuality
Introducing Total Quality Management (TQM) toIntroducing Total Quality Management (TQM) to
improve quality.improve quality.
• Increasing Speed, Flexibility, andIncreasing Speed, Flexibility, and InnovationInnovation
Adapting to bring new products to market faster.Adapting to bring new products to market faster.
• IncreasingIncreasing ResponsivenessResponsiveness to Customersto Customers
Empowering employees to deal with customers.Empowering employees to deal with customers.

Building Blocks of Competitive AdvantageBuilding Blocks of Competitive AdvantageBuilding Blocks of Competitive AdvantageBuilding Blocks of Competitive Advantage
Figure 1.5

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

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

Utilizing Information Technology (IT)Utilizing Information Technology (IT)
and E-commerceand E-commerce
Utilizing Information Technology (IT)Utilizing Information Technology (IT)
and E-commerceand E-commerce
• Benefits of IT and E-commerceBenefits of IT and E-commerce
Makes more and better information about theMakes more and better information about the
organization available to outsidersorganization available to outsiders
EmpowersEmpowers employees at all organizational levelsemployees at all organizational levels
Helps managers carry out their roles moreHelps managers carry out their roles more
effectively and efficientlyeffectively and efficiently
IncreasesIncreases awarenessawareness of competitive opportunitiesof competitive opportunities
Makes the organization moreMakes the organization more responsiveresponsive to itsto its
customerscustomers

RReadings on the historical management guruseadings on the historical management gurusRReadings on the historical management guruseadings on the historical management gurus
• AAppendix A of chapter 1ppendix A of chapter 1
• BBrief the management thoughtsrief the management thoughts

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