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Managing in Turbulent Times

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Organizational Change
Pace continues to accelerate
Change is major source of business risk

Driving Forces
Telecommunications
Diversity of Workers
Public consciousness
Global marketplace
Community of stakeholders


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Driving Force: Technology

Ever-advancing
Technology has
shrunk the world


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Driving Force: Diversity

Increasing diversity of
workers has brought
in a wide array of
differing values,
perspectives, and
expectations among
workers
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Driving Force: Public Consciousness

Public consciousness has
become much more
sensitive and
demanding that
organizations be more
socially responsible
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Driving Force: Global Marketplace

Strive to remain
competitive in the face
of increasingly tough
global competition

Much of the 3
rd
-world
countries have joined
the global marketplace,
creating a wider arena
for sales and services
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Driving Force: Stakeholders
Community of Stakeholders
Organizations are
responsible to
stockholders, and

Focus on building
relationships with
employees, customers,
partners, and suppliers

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Making a Difference Today
Requires integrating...
Tried and true management skills
+
New approaches that emphasize
Human touch
Enhance flexibility
Involve employees hearts, minds, and bodies
Successful organizations dont just happen...
they are managed to be that way!
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Definition of Management
The attainment of organizational goals in an effective
and efficient manner through
Four functions
planning,
organizing,
leading, and
controlling organizational resources.

Managers use a multitude of skills to perform functions
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Functions of Management
Planning
Leading
Controlling
Organizing

Use influence to
motivate employees
Select goals and
ways to attain
them
Assign responsibility
for task
accomplishment
Monitor activities and
make corrections
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The Process of Management
Planning
Leading
Resources
Controlling
Organizing
Performance
Human
Financial
Raw Materials
Technological
Information
Attain goals
Products
Services
Efficiency
Effectiveness
Use influence to
motivate employees
Select goals and
ways to attain
them
Assign responsibility
for task
accomplishment
Monitor activities
and make
corrections
Exhibit 1.1 page 9
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Planning Function
Definition
Defines goals for future organizational
performance
Decides tasks and use of resources needed
Corporate Examples
Planning AOL Time Warner The Lord of the
Rings p. 8
Lack of planning Merry-Go-Round p. 8

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Organizing Function
Definition
Follows planning
Reflects how organization tries to accomplish plan
Involves assignment of
tasks into departments
authority and allocation of resources across organization
Corporate Examples - Structural reorganizations
Hewlett-Packard, Sears, Xerox: accommodate changing plans
Voyant Technologies: increased sales; faster product
development


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Controlling Function
Definition
Monitoring employees activities
Determining whether the organization
is on target toward its goals
Making corrections as necessary



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Controlling Function
New Trends
Empowerment and trust of employees = training
employees to monitor and correct themselves
New information technology provides control without
strict top-down constraints

Lack of Control Information can lead to
Organizational Failure
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Organizational Performance
Attainment of organizational goals
in an efficient and effective manner


2
nd
half of
definition of
management
The Process of Management
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Organizational Performance
Organization - social entity that is goal directed and
deliberately structured

Effectiveness - degree to which organization achieves a stated
goal

Efficiency - use of minimal resources (raw materials, money,
and people) to produce the desired volume of output

Performance organizations ability to attain its goals by using
resources in an efficient and effective manner

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Management Skills
Complex
Multidimensional
Range of skills

Managers Job
Exhibit 1.2, page 12
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Management Skills
Conceptual Skills Cognitive ability to see the
organization as a whole and the relationships among
its parts

Human Skills ability to work with and through other people
and to work effectively as a group member

Technical Skills understanding of and proficiency in the
performance of specific tasks

When skills Fail Experiential Exercise: Management Aptitude Questionnaire
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Management Types - Vertical
Management Levels in the Organizational Hierarchy
Managerial Levels in the Organizational Hierarchy
Managerial Levels in the Organizational Hierarchy
Exhibit 1.3, p. 13
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Management Types - Horizontal
Functional Managers -
Responsible for a department that performs a
single functional task and
Has employees with similar training and skills

General Managers
Responsible for several departments that perform
different functions
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Ten Manager Roles
Category Role
Informational Monitor
Disseminator
Spokesperson
Interpersonal Figurehead
Leader
Liaison
Decisional Entrepreneur
Disturbance handler
Resource allocator
negotiator
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Management and the New Workplace
Characteristics
Resources = Bits--information
Work = Flexible, virtual
Workers = Empowered employees,
free agents

Forces on Organizations
Technology = Digital, e-business
Markets = Global, including internet
Workforce = Diverse
Values = Change, speed
Events = Turbulent, more frequent
crises

Management Competencies
Leadership = Dispersed,
empowering
Focus = Connection to
customers, employees
Doing Work = By teams
Relationships = Collaboration
Design = Experimentation,
learning organization
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Human Resource Perspective
Suggests jobs should be designed to meet
higher-level needs by allowing workers to
use their full potential
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Physiological
Safety
Belongingness
Esteem
Self-
actualization
Abraham Maslows
Hierarchy of Needs
Based on needs satisfaction
1908-1970
Chapter 16 Maslow in more detail
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Dislike work will avoid it
Must be coerced,
controlled, directed, or
threatened with
punishment
Prefer direction, avoid
responsibility, little
ambition, want security
Do not dislike work
Self direction and self
control
Seek responsibility
Imagination, creativity
widely distributed
Intellectual potential
only partially utilized
Douglas McGregor
Theory X & Y
Theory X Assumptions Theory Y Assumptions
1906-1964
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Organizational Environment
All elements existing outside the
boundary of the organization that have
the potential to affect the organization
Managers Challenge: IBM, p. 77
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External Environment
General environment affects indirectly

Task environment
- Affects directly
- Influences operations and performances

Internal environment elements within the
organizations boundaries
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Organizational Environments
Management
Internal
Environment
Suppliers
C
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Customers
L
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M
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Technological
General
Environment
Task
Environment
Technological
Suppliers
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International Dimension
Provides New
Customers
Competitors
Suppliers

Shapes:
Social trends
Technological trends
Economic trends

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Importance of International Business
If you are not thinking
international,

you are not thinking
business management
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A Borderless World
Business is becoming a unified, global field
Companies that think globally have a
competitive edge
Domestic markets are saturated for many
companies
Consumers can no longer tell from which
country they are buying
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Ethics and Social
Responsibility
Ethical values
Social responsibility
Fundamental approaches to ethical issues
Chapter 5
Topics
Managerss Challenge: Timberland
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Ethics
The code of moral principles and values
that govern the behaviors of a person or
group with respect to what is right or
wrong.
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Ethical Dilemma
A situation that arises when all alternative
choices or behaviors have been deemed
undesirable because...

potentially of negative ethical consequences,
making it difficult to distinguish right from
wrong
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Ethical Decision Making Approaches
Utilitarian Approach
Individualism Approach
Moral-Rights Approach
Justice Approach

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Utilitarian Approach
Moral behavior produces the greatest good for the
greatest number
Critics fear a Big Brother approach and ask if the
common good is squeezing the life out of the
individual
Example Oregons decision to extend Medicaid to
400,000 previously ineligible recipients by refusing
to pay for high-cost, high-risk procedures
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Individualism Approach
Acts are moral when they promote the individual's
best long-term interests, which ultimately leads to
the greater good
Individual self-direction paramount
Individualism is believed to lead to honesty &
integrity since that works best in the long run
Examples: Top executives from WorldCom, Enron,
Tyco demonstrate flaws of approach
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Moral-Rights Approach
Moral decisions are those that best
maintain the rights of those people
affected by them.
An ethical decision is one that avoids
interfering with the fundamental rights of
others
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Justice Approach
Moral Decisions must be based on
standards of equity, fairness, impartiality
Three types of Justice Approaches:
O Distributive Justice
O Procedural Justice
O Compensatory Justice
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Factors Affecting Ethical Choices
The Manager
Levels or stages of moral
development
Pre-conventional
Conventional
Post-conventional
The Organization
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Social Responsibility
Organizations obligation to
make choices and take actions
that will contribute to the welfare
and interests of society and
organization
Being a good corporate citizen
Difficulty in understanding
issues can be ambiguous with
respect to right and wrong
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Environmental Responsibility
Commitment
Activist
Approach
Stakeholder
Approach
Market Approach
Legal Approach
The Shades of
Corporate Green
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Total Corporate Responsibility
Economic
Responsibility
Legal
Responsibility
Ethical
Responsibility
Discretionary
Responsibility
Ethical Dilemma: Should We Go Beyond the Law?
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The Ethical Organization
Ethical individuals = honest, have integrity,
strive for a high level of moral development
Ethical leadership = provides the necessary
actions, committed to ethical values and
helps others to embody those values
Organizational structure = embodies a code
of ethics, and methods to implement ethical
behavior
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Planning for the Future
Most organizations are facing turbulence
and growing uncertainty
Economic, political, & social turmoil =
managers wonder how to cope
Renewed interest in organizational planning
Managers Challenge: Europa hotel
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The Importance of Goals and Plans
CGuides to action
CRationale for decisions
CStandard of performance
Goals and Plans
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Goals and Plans
Goal - A desired future state that the organization
attempts to realize.
Plan - A blueprint specifying the resource
allocations, schedules, and other actions necessary
for attaining goals
Planning determining the organizations goals and
the means for achieving them
the most fundamental management function
the most controversial management function.




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Mission
Statement
Strategic Goals/Plans
Senior Management
(Organization as a whole)
Tactical Goals/Plans
Middle Management
(Major divisions, functions)
Operational Goals/Plans
Lower Management
(Departments, individuals)
Internal Message
Legitimacy,
motivation,
guides,
rationale,
standards
External Message
Legitimacy for
investors, customers,
suppliers, community
Levels of Goals/Plans & Their Importance
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Organizational Mission
Mission = organizations reason for existing
Mission Statement
Broadly states the basic business scope and
operations that distinguishes it from similar types
of organizations
May include the market and customers
Some may describe company values, product
quality, attitudes toward employees
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Bristol-Myers Squibb
Mission Statement
Our companys mission is to
extend and enhance human life
by providing the highest-quality
pharmaceutical and related
health care products.
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Strategic Goals and Plans
Strategic Goals
Where the organization wants to be in the future
Pertain to the organization as a whole
Strategic Plans
Action Steps used to attain strategic goals
Blueprint that defines the organizational
activities and resource allocations
Tends to be long term
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Tactical Goals and Plans
Tactical Goals
- Apply to middle management
- Goals that define the outcomes that major
divisions and departments must achieve
Tactical Plans
-Plans designed to help execute major strategic plans
-Shorter than time frame than strategic plans
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Operational Goals and Plans
Operational Goals
- Specific, measurable results
- Expected from departments, work groups, and
individuals
Operational Plans
- Organizations lower levels that specify action
steps toward achieving operational goals
- Tool for daily and weekly operations
- Schedules are an important component
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Hierarchy of Goals
Operational
Goals
Tactical
Goals
Strategic
Goals
Mission
Traditional Responsibility
Top
Management
Middle
Management
1st-line
Management
& Workers
Shrinking middle
management
Employee
empowerment
Employees
Today
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Characteristics of Effective
Goal Setting
Specific and measurable
Challenging but realistic
Defined time period
Linked to rewards
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Organizing
Organization is the deployment of resources to
achieve strategic goals.
It is reflected in
Division of labor into specific departments & jobs
Formal lines of authority
Mechanisms for coordinating diverse organizational
tasks
Managers Challenge: Nissan
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Organization Structure
Defines how tasks are divided,
resources are deployed, and
departments are coordinated
Set of formal tasks assigned
Formal reporting relationships

The design of systems to ensure
effective coordination of employees
across department
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The Organization Chart
The Home Depot is the world's largest home
improvement retailer currently operating
1,363 stores.
Visual representation
Set of formal tasks
Formal reporting relationships
Framework for vertical control
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Work Specialization
Tasks are subdivided into individual jobs
Employees perform only the tasks relevant
to their specialized function
Jobs tend to be small, but they can be
performed efficiently
Division of labor concept
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Chain of Command
Unbroken line of authority that links all
persons in an organization
Shows who reports to whom

Associated with two underlying principles
O Unity of Command
O Scalar Principle
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Authority
Formal and legitimate right of a manager to
make decisions and issue orders
Allocate resources to achieve organizationally
desired outcomes
Authority is distinguished by three characteristics
C Authority is vested in organizational positions, not
people
C Authority is accepted by subordinates
C Authority flows down the vertical hierarchy
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63
Responsibility
The duty to perform the task or activity
an employee has been assigned

Managers are assigned authority
commensurate with responsibility
Flip side of the authority coin
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Accountability
Mechanism through which authority and
responsibility are brought into alignment
People are subject to reporting and
justifying task outcomes to those above
them in the chain of command
Can be built into the organization
structure
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Delegation
Process managers use to transfer
authority and responsibility

Organizations encourage
managers to delegate authority to
lowest possible level

Ethical Dilemma: A Matter of Delegation
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Span of Management/
Span of Control
Number of employees who report to a supervisor
Traditional view = seven subordinates per manager
Lean organizations today = 30+ subordinates

Supervisor Involvement
must be closely involved with subordinates, the span
should be small
need little involvement with subordinates, it can be
large
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Factors Associated With Less
Supervisor Involvement
Work is stable and routine
Subordinates perform similar work tasks
Subordinates are concentrated in a single location
Subordinates are highly trained
Rules and procedure defining task activities are available
Support systems and personnel are available for the
manager
Little time is required in nonsupervisory activities
Managers preferences and styles favor a large span
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68
Centralization versus Decentralization
Greater change and uncertainty in the
environment are usually associated with
decentralization
The amount of centralization or
decentralization should fit the firms
strategy
In times of crisis or risk of company failure,
authority may be centralized at the top
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Five Approaches to Structural Design
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Five Approaches to Structural Design
Slide 2
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Dual Authority Structure in a
Matrix Organization
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Types of Organizational Change
Culture/People
Strategy
Structure
Technology Products
SOURCE: Based on Harold J. Leavitt, Applied Organizational Change in Industry: Structural, Technical, and Human
Approaches, In New Perspectives in Organization Research, ed.W.W. Cooper, H.J. Leavitt, and Shelly II (New York: Wiley,
1964), 55-74.
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Organizational Change
C Technology: General rule = change is bottom up
C New product:
Horizontal linkage model emphasizes shared development of
innovations among several departments
Time-based competition is based on the ability to deliver products
and services faster than competitors
C Structure: Successful change = through a top-down approach
C Culture/people:
Training is the most frequently used tool for changing the
organizations mind-set
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Human Resource Management
All managers
are resource
managers
Employees are
viewed as
assets
Matching process,
integrating the
organizations
goals with
employees needs
How a company manages its workforce may be single
more important factor in sustained competitive success
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75
Current Strategic Issues
Becoming more competitive globally
Improving quality, productivity, &
customer service
Managing mergers & acquisitions
Applying new information technology for
e-business
Determine a companys need for skills and employees
Experiential Exercise: Do You Want to be an HR Manager?
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Human Resource Management Goals
Develop an Effective Workforce
Training
Development
Appraisal
Maintain an Effective Workforce
Wage and salary
Benefits
Labor relations
Terminations
HRM planning
Job analysis
Forecasting
Recruiting
Selecting
Attract an Effective Workforce
Company Strategy
HRM Environment
Legislation
Trends in society
International events
Changing
technology
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Attracting an Effective Workforce
Choose Recruiting
Sources
Want ads
Headhunters
Internet
HR Planning
Retirements
Growth
Resignations
Select the
Candidate
Application
Interview
Tests
Welcome New
Employee
Employee Contributions
Ability
Education
Creativity
Commitment
Expertise
Company Inducements
Pay and benefits
Meaningful work
Advancement
Training
Challenge
Matching Model
Match with
Company Needs
Strategic goals
Current & future competencies
Market changes
Employee turnover
Corporate culture
Employee Needs
Stage of career
Personal values
Promotion aspirations
Outside interests
Family concerns
Match with
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Human Resource Planning
Forecasting of human resource needs and
the projected matching of individuals with
expected vacancies
? = New technologies emerging
? = Volume of business likely next 5-10 years
? = Turnover rate, how much is avoidable, if any

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Recruiting
Recruiting = activities or practices that define the
desired characteristics of applicants for specific jobs
Internal promote-from-within policies used by
many to fill high-level positions
External = recruiting newcomers from outside has
advantage of multiple sources
E-cruiting = use of Internet - fastest-growing
approach to recruiting
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Basic Building Blocks
of HR Management
Job Analysis
Job Description
Job Specification
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81
Selecting
Selection = process of determining the skills,
abilities, and other attributes a person needs
to perform a particular job
Validity = relationship between an applicants
score on a selection device and his or her
future job performance

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Selecting
Application form - device used for collecting
information about an applicants education,
previous job experience, and other
background characteristics
Research = biographical information
inventories can validly predict future job
success
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Interviewing An Applicant
Know what you want
Prepare a road map
Use open-ended questions
Do not ask irrelevant questions
Do not rush interview
Do not rely on your memory
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Termination
OEmployees who are poor performers
can be dismissed
O Employers can use exit interviews in a
positive manner
Value of termination for maintaining an effective
workforce is two fold
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85
Dynamics of Behavior in Organizations
Employees and managers bring their individual
differences to work each day
Differences in attitudes, values, personality, and
behavior influence
how people interpret an assignment,
whether they like to be told what to do
how they handle challenges
how they interact with others
Managers Challenge: Quick Eagle Networks
Managers need to understand the way individuals & groups act
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86
Dynamics of Behavior
in Organizations
Attitudes
Personality
Perception
Learning
Stress management
Topics
Chapter 14
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87
Organizational Behavior
Interdisciplinary field dedicated to
the study of
attitudes
behavior
performance
Commonly called OB
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Attitudes
Cognitive and affective evaluation that
predisposes a person to act in a certain way
Attitudes determine how people
Perceive the work environment
Interact with others
Behave on the job
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Components of an Attitude
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Components of Attitudes
Cognitive component includes the beliefs,
opinions, and information the person has
about the object of the attitude
Affective component is the persons emotions
or feelings about the object of the attitude
Behavioral component of an attitude is the
persons intention to behave toward the
object of the attitude in a certain way
Particularly important when attempting to change attitudes
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High-Performance Work Attitudes
Two attitudes that might
relate to high performance
Job Satisfaction
Organizational Commitment
Managers of todays knowledge workers often rely on
job satisfaction to keep motivation and enthusiasm for
the organization high
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High-Performance Work Attitudes
Job Satisfaction = positive attitude
toward ones job

Organizational Commitment = loyalty to
and heavy involvement in ones
organization
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Conflicts Among Attitudes
Cognitive Dissonance = condition in which
two attitudes or a behavior and an attitude
conflict
Leon Festinger 1950s
People want to behave in accordance with their
attitudes
Usually will take corrective action
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94
Perception
Cognitive process people use to make sense
out of the environment by
Selecting
Organizing
Interpreting information
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95
Personality
Set of characteristics that underlie a
relatively stable pattern of behavior in
response to ideas, objects, or people in
the environment
Big Five Personality Factors
Extroversion
Agreeableness
Conscientiousness
Emotional Stability
Openness to Experience
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Myers-Briggs Type Indicator (MBTI)
Personality test that measures a persons
preference for
introversion vs. extroversion
sensation vs. intuition
thinking vs. feeling
judging vs. perceiving
Experiential Exercise: Personality Assessment (MBTI)
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Stress and Stress Management
Stress = physiological and emotional response
to stimuli that place physical or psychological
demands on an individual
Type A Behavior = pattern characterized by
extreme competitiveness, impatience,
aggressiveness, and devotion to work
Type B Behavior = pattern that lacks Type A
and includes a more balanced, relaxed lifestyle
Ethical Dilemma: Should I Fudge the Numbers?
Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved.
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Work Stress
Four Categories
O Job Tasks Demands
O Physical Demands
O Role Demand (Sets of expected
behaviors)
O Interpersonal Demands
Work stress is skyrocketing

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