SENIOR OUTCOMES SEMINAR

(BU385)

Management

What is Management?
A set of activities planning and decision making, organizing, leading, and controlling
Directed at an organizations resources human, financial, physical, and information With the aim of achieving organizational goals in an efficient and effective manner.

Basic Purpose of Management

EFFICIENTLY

Using resources wisely and in a cost-effective way

EFFECTIVELY
Making the right decisions and successfully implementing them

What is a Manager?
Someone whose primary responsibility is to carry out the management process. Someone who plans and makes decisions, organizes, leads, and controls: human, financial, physical, and information resources.

The Management Process

Planning and Decision Making

Setting an organizations goals and selecting a course of action from a set of alternatives to achieve them.

Organizing

Determining how activities and resources are grouped.

The set of processes used to get organizational members to work together to advance the interests of the organization. Monitoring organizational progress towards goals.

Leading

Controlling

Fundamental Management Skills

Management Skill Mixes at Different Organizational Levels

An Integrative Framework of Management Perspectives

Systems Approach Recognition of internal interdependencies Recognition of environmental influences Classical Management Perspectives Methods for enhancing efficiency and facilitating planning, organizing, and controlling Behavioral Management Perspectives Insights for motivating performance and understanding individual behavior, groups and teams, and leadership Contingency Perspective Recognition of the situational nature of management Response to particular characteristics of situation Quantitative Management Perspectives Techniques for improving decision making, resource allocation, and operations

Effective and efficient management

Classical Management Perspective

Scientific Management
Concerned with improving the performance of individual workers (i.e., efficiency). Grew out of the industrial revolutions labor shortage at the beginning of the twentieth century.

Administrative Management

A theory that focuses on managing the total organization.

Scientific Management

Frederick Taylor (18561915)

Replaced old methods of how to do work with scientifically-based work methods to eliminate soldiering, where employees deliberately worked at a pace slower than their capabilities. Believed in selecting, training, teaching, and developing workers. Used time studies of jobs, standards planning, exception rule of management, slide-rules, instruction cards, and piece-work pay systems to control and motivate employees.

Classical Management Perspective

Administrative Management Theory

Focuses on managing the whole organization rather than individuals. Was first to identify the specific management functions of planning, organizing, leading, and controlling. His theory of bureaucracy is based on a rational set of guidelines for structuring organizations.

Henri Fayol (18451925)

Max Weber (18641920)

Behavioral Management Perspective

Behavioral Management

Emphasized individual attitudes and behaviors, and group processes, and recognized the importance of behavioral processes in the workplace. Mayo: founder of human relations

Hawthorne Studies (19271932)

The Hawthorne Studies

(19271932)

Conducted by Elton Mayo and associates at Western Electric Illumination study workplace lighting
adjustments affected both the control and the experimental groups of production employees.

Group studyimplementation of piecework

incentive plan caused production workers to establish informal levels of acceptable individual output. Over-producing workers were labeled rate busters and under-producing workers were considered chiselers.

Behavioral Management Perspective

Human Relations Movement

Grew out of the Hawthorne studies. Proposed that workers respond primarily to the social context of work, including social conditioning, group norms, and interpersonal dynamics. Assumed that the managers concern for workers would lead to increased worker satisfaction and improved worker performance.

Behavioral Management Perspective

Abraham Maslow

Advanced a theory that employees are motivated by a hierarchy of needs that they seek to satisfy. Proposed Theory X and Theory Y concepts of managerial beliefs about people and work.

Douglas McGregor

Organizational Behavior

A contemporary field focusing on behavioral perspectives on management.

Draws on psychology, sociology, anthropology, economics, and medicine.

Important topics in organizational behavior research:

Job satisfaction and job stress Motivation and leadership Group dynamics and organizational politics Interpersonal conflict The structure and design of organizations

Quantitative Management Perspective

Quantitative Management
Emerged during World War II to help the Allied forces manage logistical problems. Focuses on decision making, economic effectiveness, mathematical models, and the use of computers to solve quantitative problems.

Quantitative Management Perspective

Management Science

Focuses on the development of representative mathematical models to assist with decisions. Practical application of management science to efficiently manage the production and distribution of products and services.

Operations Management

The Systems Perspective of Organizations

Outputs into the environment: products/services, profits/losses, employee behaviors, and information outputs

Inputs from the environment: material inputs, human inputs, financial inputs, and information inputs

Transformation process: technology, operating systems, administrative systems, and control systems

Feedback

The Contingency Perspective

Universal Perspectives

Include the classical, behavioral, and quantitative approaches. An attempt to identify the one best way to manage organizations. Suggests that each organization is unique. The appropriate managerial behavior for managing an organization depends (is contingent) on the current situation in the organization.

The Contingency Perspective

Decision Making and the Planning Process

The Planning Process

The Environmental Context

The organizations mission

Purpose Premises Values Directions

Strategic goals

Strategic plans

Tactical goals

Tactical plans

Operational goals

Operational plans

Kinds of Goals

By Level

Mission statement is a statement of an organizations fundamental purpose. Strategic goals are goals set by and for top management of the organization that address broad, general issues. Tactical goals are set by and for middle managers; their focus is on how to operationalize actions to strategic goals. Operational goals are set by and for lowerlevel managers to address issues associated with tactical goals.

SWOT Analysis
Strengths Weakness

Mission
An organizations fundamental purpose

SWOT Analysis
To formulate strategies that support the mission

es Opportuni ties Threats

Internal Analysis Strengths (distinctive competencies)

Weaknesses

External Analysis Opportunities

Threats

Best Strategies
Those that support the mission and exploit opportunities and strengths neutralize threats avoid (or correct) weaknesses

Managing Diversification

BCG Matrix

A method of evaluating businesses relative to the growth rate of their market and the organizations share of the market. The matrix classifies the types of businesses that a diversified organization can engage as: Dogs have small market shares and no growth prospects. Cash cows have large shares of mature markets. Question marks have small market shares in quickly growing markets. Stars have large shares of rapidly growing markets.

Organizational Structure

The Nature of Organizing

Job Specialization Grouping Jobs: Departmentalization

The Bureaucratic Model of Organization Design Situational Influences on Organization

Core Technology Environment Organization Size and Life Cycle

Alternatives to Specialization

Job Rotation

Systematically moving employees from one job to another. Most frequent use today is as a training device for skills and flexibility. An increase in the total number of tasks workers perform. Increasing both the number of tasks the worker does and the control the worker has over the job.

Job Enlargement

Job Enrichment

Establishing Reporting Relationships

Chain of Command

A clear and distinct line of authority among the positions in an organization.

Unity of Command
Each person within an organization must have a clear reporting relationship to one and only one boss.

Scalar Principle
A clear and unbroken line of authority must extend from the bottom to the top of the organization.

Work-Related Attitudes
Job Satisfaction or Dissatisfaction

An attitude that reflects the extent to which an individual is gratified or fulfilled by his or her work. Job satisfaction is influenced by personal, group, and organizational factors. Satisfied employees are absent from work less often, make positive contributions, and stay with the organization. Dissatisfied may experience stress which disrupts coworkers.

Job Satisfaction and Work Behaviors

Work-Related Attitudes

Job Satisfaction and Work Behaviors

High levels of job satisfaction do not necessarily lead to high job performance.

Work-Related Attitudes

Organizational Commitment

An attitude that reflects an individuals identification with and attachment to an organization.

Organizational Commitment and Work Behaviors

Employee commitment strengthens with an individuals age, years with the organization, sense of job security, and participation in decision making. Committed employees have highly reliable habits, plan a longer tenure with the organization.

Motivation
The Nature of Motivation Content Perspectives on Motivation

The Need Hierarchy Approach The Two-Factor Theory Individual Human Needs (nAch, nAff)

Process Perspectives on Motivation

Expectancy Theory Equity Theory Goal-Setting Theory

Process Perspectives on Motivation

Porter-Lawler Extension of Expectancy Theory

Intrinsic rewards (outcomes) Performance Perceived equity Extrinsic rewards (outcomes) Satisfaction

Source: Edward E. Lawler III and Lyman W. Porter, The Effect of Performance on Job Satisfaction, Industrial Relations, October 1967, p. 23. Used with permission of the University of California.

Figure 10.5

Popular Motivational Strategies

Empowerment and Participation

Empowerment
The process of enabling workers to set their own work goals, make decisions, and solve problems within their sphere of influence.

Participation
The process of giving employees a voice in making decisions about their work.

Areas of Participation for Employees

Making decisions about their jobs. Participating in decision making about broader issues of product quality.

Using Reward Systems to Motivate Performance

Designing Effective Reward Systems

Reward system must meet an individuals needs. Rewards should compare favorably with other organizations. Distribution of rewards must be perceived to be equitable. Reward system must recognize different needs.

Using Reward Systems to Motivate Performance

Popular Approaches to Rewarding Employees Traditional systems

Fixed hourly or monthly rate.

Merit systems
Employees get different pay raises at the end of the year based on overall job performance.

Incentive systems
Employees get different pay amounts at each pay period in proportion to what they do (e.g., piece-rate pay plans).

Using Reward Systems to Motivate Performance

Popular Approaches (contd) Profit sharing plans

Provides bonus based to corporate profits.

Gainsharing
All group members get bonuses when performance targets are exceeded.

Lump sum bonuses

One-time reward, not an increase in base.

Pay-for-knowledge
Pay the individual rather than the job.

Leadership

The Nature of Leadership The Meaning of Leadership Leadership Versus Management Power and Leadership The Search for Leadership Traits Leadership Behaviors Michigan Studies Ohio State Studies Leadership Grid Situational Approaches to Leadership LPC Theory

Leadership
Situational Approaches to Leadership (contd)

Path-Goal Theory The Leader-Member Exchange Approach Substitutes for Leadership Charismatic Leadership Transformational Leadership

Related Perspectives on Leadership

Types of Power in Organizations

Source: Van Fleet, David D., and Tim Peterson, Contemporary Management, Third Edition. Copyright 1994 by Houghton Mifflin Company. Used with permission.

The Nature of Leadership

Power

and Leadership
ability to affect the behavior of others.

Power:

Legitimate power is granted through the organizational hierarchy. Reward power is the power to give or withhold rewards. Coercive power is the capability to force compliance by means of psychological, emotional, or physical threat. Referent power is the personal power that accrues to someone based on identification, imitation, loyalty, or charisma. Expert power is derived from the possession of information or expertise.

Groups

Groups and Teams in Organizations Types of Groups and Teams Why People Join Groups and Teams Stages of Group and Team Development Characteristics of Groups and Teams Role Structures Behavioral Norms Cohesiveness Formal and informal Leadership

Groups and Teams in Organizations

Functional Group

A permanent group created to accomplish a number of organizational purposes within an indefinite time horizon. A group created by its own members for purposes that may or may not be relevant to organizational goals. A group created by the organization to accomplish a relatively narrow range of purposes within a stated time horizon.

Informal or Interest Group

Task Group

Groups and Teams in Organizations

Team
A group of workers who function as a unit, often with little or no supervision, to carry out work-related tasks, functions, and activities. Sometimes are called self-managed teams, cross-functional teams, or high performance teams.

Stages of Group Development (Tuchman)

Source: Van Fleet, David D., and Tim Peterson, Contemporary Management, Third Edition. Copyright 1994 by Houghton Mifflin Company. Used with permission.

Characteristics of Teams

Role

The part an individual plays in helping the group reach its goals.
Task-specialistrole concentrating on getting the groups tasks accomplished. Socioemotional roleproviding social and emotional support to others on the team.

Characteristics of Teams

Cohesiveness

Factors That Influence Group Cohesiveness

Factors That Increase Cohesiveness Intergroup competition Personal attraction Favorable evaluation Agreement on goals Interaction Factors That Reduce Cohesiveness Group size Disagreement on goals Intragroup competition Domination Unpleasant experiences

The extent to which members are loyal and committed to the group; the degree of mutual attractiveness within the group.

Interpersonal and Intergroup Conflict

The Nature of Organizational Conflict

High

Performance

Optimal level of conflict

Low Low

Conflict

High