Flashcards in Chapter 13 Deck (28):
Bringing resources to life
every business needs resources
the resources need management to bring them to life
managers provide vision and direction for their organizations, decide how to use resources to acheive goals, inspire others, inside and outside their companies-to follow their lead. managers acheive the goals of an organization through planning, organizing, leading, and controlling organizational resources including people, money and time.
Planning means figuring out where and how to get there
-->determining organizational goals and action plans for how to achieve those goals.
Organizing means determining a structure for both indivudal jobs and the overall organization.
leading means directing and motivating people to achieve organizational goals.
controlling means checking performance and making adjustments as needed.
being a manager is challenging today. the role of the manager has transformed. bottom line goal has remaiend the same-create value for the organization.
first line management
most medium-large companies have 3 levels of management.
Top management: sets overall direction of the firm. top managers must articulate a vision, establish priorities, allocate time, money, other resources. typical titles are chief executive officer, president, vice president.
Middle: manages the managers. middle managers communicate up and down the pyramid, often involves coordinating teams and special projects with their peers from other departments. typical titles are director, division head, branch manager.
First line management: manages the people who do the work. first line managers must train, motivate, evaluate non management employees, so they're heavily involved in day to day production issues. typical titles include supervisor, foreperson, section leader.
smaller companies usually don't have a hierarchy. often the owner must act as the top, middle and first line rolled into one. requires flexibility and developed management skills.
The management skills to get the job done
Technical: refers to expertise in a specific function area or department. does not necessarily relate to technology. people can have technical skills or specific expertise in anything from sales to copy writing to accounting to airplane repair to computer programming.
Human: refer to the ability to work with and through other people in a range of different relationships. human skills include communication, leadership, coaching, empathy and team building. a manager with strong human skills can usually mobilize support for initiatives and find win win solutions for conflicts.
Conceptual: refer to the ability to grasp a big picture view of the overall organization and relationship between its various parts. conceptual skills also help managers understand how their company fits into the broader competitive env. typically excel at strategic planning.
all 3 categories are essential for management success. their importance varies according to level of manager. front line must have high degree of technical which help them hire train evaluate employees;avoid mistakes, ensure high quality production. middle need a high level of human skils. they're typically a bridge between depts. coordinating people and projects with mismatched priorities. top managers must demonstrate excellent conceptual skills to formulate a vision, interpret marketplace trends, plan for future. to move up, managers must constantly learn and grow. across all 3 skill sets critical thinking and decision making abilities are crucial. critical thinking helps managers find value in an overload of info while decision making helps them respond wisely and fast w focus on consumer satisfaction.
managers who expect to grow in the company hierarchy must expect to foster new skills.
theories of motivation 1
maslows hierarchy of needs
motivated workers tend to feel great about their jobs and workers who feel great produce more. recent research suggests peoples thoughts and feelings play a vital role in motivation.
Maslows hof theorized people are motivated to satisfy unmet needs. he proposed a hierarchy of needs from basic to abstract suggesting as each need is met people become motivated to meet the next highest need in the pyramid in the pyramid. From a workplace perspective the idea people are motivated by unmet neesd holds true for the first 2 levels. finding a job that pays the bills is the primary motivator for most people who don't have a job. people who have a job but no dental care would find dental insurance more motivating than a company picnic geared towards meetign social needs.
once physiological and safety needs are met the other needs are motivating to diff degrees in diff people. an employee w strong social connections outside work might be more motivated by a promotion that meets esteem needs than by a company outing that meets social. a number of firms use self actualization needs as a starting point for motivating employees, by creating a mission statement that communicates the importance of work. ex google inspires employees through its lofty purpose: to organize the worlds info and make it universally accessible and useful.
theories of motivation 2
the hierarchy of needs maslow
Physiological: need for basic survival-food,water,clothing and shelter. ex: job w enough pay to buy the basics
Safety: need to feel secure, free of harm and fear. ex: safety equipment, health care plans, retirement plans, job security
social(belonging): need to feel connected to others-accepted by family and friends ex: teamwork, positive corporate culture, company lunchroom
esteem: need for self respect and respect from others-recognition and status ex: acknowledgement, promotions,perks
Self actualization: need for fulfillment, the need to realize one's fullest potential ex challenging, creative jobs; work that ties to a greater good
theories of motivation 3
Theory X and theory Y
student of maslow douglas mcgregor studied workplace motivation from a diff angle. he proposed management attitudes toward workers would directly affect worker motivation. his research suggested management attitudes fall into 2 opposing categories-theory x and y
he proposed managers should employ theory y assumptions to capitalize on the imagination and intelligence of every worker. today in ca some use theory x but a number have begun y tapping in to a pool of employee input.
x assumptions about workers: workers dislike work and will do everything they can to avoid it
fear is motivating-coercion and threats are vital to get people to work toward company goals
people prefer to be directed, avoiding responsibility and seeking security
Y assumptions ab workers: work is as natural as play or rest-workers do not inherently dislike it
different rewards can be motivating-people can exercise self direction and self control to meet company goals
people can accept and seek responsibility
the capacity for imagination, creativity, and ingenuity is widely distributed to the population
the intellectual capacity of the avg worker is underutilized in the workplace
theories of motivation 4
job enrichment: the creation of jobs with more meaningful content, under the assumption that challenging, creative work will motivate employees.
skill variety: workers can use a range of diff skills
task identity: workers do complete tasks w clear beginnings and endings
task significance: workers understand the impact of the task on others
autonomy: workers have freedom and authority regarding their jobs
feedback: workers receive clear, frequent info about their performance
theories of motivation 5
expectancy theory deals with the relationship among individual effort, individual performance, and individual reward. the key concept is a worker will be motivated if he or she believes the effort will lead to performance and performance will lead to a meaningful reward.
the theory suggests if any link in the chain is broken the worker won't be motivated.
theories of motivation 6
stacy j adams
equity theory proposes the perceptions of fairness directly affect worker motivation. key idea is people won't be motivated if they believe the relationship between what they contribute and what they earn is diff from the relationship between what others contribute and earn. ex if you work a 10h day and earn less than the guy next to you who works 7h days, you will think its unfair. to restore a sense of balance you may:
demand a raise
start working 7h days
convince yourself the other guy is about to be fired
look for another job
the response to perceived inequity always involves trying to change the system, your own work habits, distorting your perceptions or leaving the company.
equity theory is based on perceptions which aren't always on point. people are prone to overestimate their own contributions which throws perceived equity off.
companies use a range of approaches. most firms no longer seek to make employees happy, instead they want them to be productive and engaged. but for employees its more than just the productivity. "people still want to find meaning in their work and the institutions that employ them"
a growing emphasis on corp culture has captured the best of both worlds for companies that do it right. a distinctive positive culture creates productive employees who are attached to their work and companies. ex kraft foods provides a #1 on site amenities for staff; employee lounge w tv and foosball, fitness facility, quiet room for meditation and reflection, nap room....ceridian ca has a maternity leave top up for new mothers, parental leave top up for new fathers and adoptive parents, generous adoption subsidy for employees pets..
a growing number of businesses have expanded their range of employee incentives beyond cash. while money is obviously important "telling employees they're doing great" is big. employee training is a non cash motivational tactic gaining momentum across the economy in response to growing array of complex skills needed by workforce. the emphasis on education is motivating given more employees identify themselves based on their field of expertise rather than organization.
planning: figuring out where to go and how to get there
80% of executives identify planning as their most valuable management tool. even though planning is critical its risky in light of cutthroat competition, rapid change, economic uncertainty. best plans keep the organization on track, w/o sacrificing flexibility and responsiveness. they incorporate ways to respond to change inside and outside the org.
top level managers focus on strategic planning: they establish a vision for the company, define long term objectives and priorities. determine broad action steps, allocate resources.
Middle managers focus on tactical planning: applying strategic plan to their specific areas of responsibility
first line managers focus on operational planning: applying the tactical plans to daily, weekly and monthly operations.
successful firms encourage a flow of feedback up and down the org ensuring all key plans are sound and all key players buy in.
contingency planning: planning for unexpected events, usually involving a range of scenarios and assumptions that differ from the assumptions behind the core plans. contingency plans consider what might go wrong both inside the business and the outside env. potential issues include:
how should we respond if our competitors start a price war? what should we do if the gov regulates our industry?
how can we restart our business if a natural disaster destroys our planet?
how will we evacuate employees if terrorists strike our headquarters?
ex wilderness resort in bc might concentrate its contingency plans on forest fires while air canada might focus on plans responding to a pilots strike
examples of ^
strategic: senior management, typically 5 year timeframe. should we acquire a new company? should we begin manufacturing in china? should we take company public?
tactical: middle management, 1 year time frame, should we invest in new production equipment? should we spend more time servicing each customer? should we spend fewer ad dollars on tv more on web?
operational: first line management, daily weekly monthly, how should we schedule employees this week? when should we schedule delivery for each batch of product? how should customer service people answer phones?
Strategic planning: setting the agenda
most fundamental part of the planning process because all other plans and most major management decisions stem from the strategic plan. typically includes these steps:
defining your mission,evaluate organizations competitive position, set goals for organization, create strategies for competitive differentiation, implement strategies, evaluate results and incorporate lessons learned.
Gen Y attitude and expectations
those born between 1978 1988 changing face of workforce. self confident, outspoken have a new set of challenges for managers across the economy. millenials and echo boomers
goal driven: expect to perform for their rewards. they find smaller, short term goals more motivating than long term goals.
now focused: looking for instant gratification. typically expect to make an impact in their companies right away, aren't willing to pay dues or suck up to people they don't respect in order to make it happen.
change oriented-actively embrace change and excitement. many anticipate and hope to change jobs frequently. don't share expectation of long term employment that disillusioned many parents
tech savy-masters of internet and ipod. expect top tech in workplace
diverse-gen y is most diverse demographic groups- 1/3 is a minority-most don't believe ethnicity defines their character.
idealistic-gen y'ers grew up in a scary world marked by violence in their own backyards. yet they remain convinced that they can make a positive diff, seeking solutions through a commitment to volunteerism
fulfillment focused-tend to deeply value fam and personal lives. expect to acheive lofty career goals sans sacrificing time for themselves and people they care about.
Steps to setting the agenda:
1. defining your mission
2. evaluate the organizations competitive position
1. the mission of an organization articulates its reason for being. the mission defines the organizations purpose, values, core goals, providing framework for all other plans. most large companies present their mission as a simple, vivid, compelling statement everyone in the company from the janitor to ceo, customers to investors can understand. vary in length, their language, and names but they share a common goal; providing a clear, long term focus for the organization.
2. every firm must plan in the context of the marketplace. many companies use a swot analysis (strengths, weaknesses, opportunities and threats)to evaluate where they stand relative to the competition. strengths and weaknesses are internal to the organization and include factors that would build up or drag down the companys performance. opportunities and threats are external, include factors that would affect the companys performance but are typically out of the companys control.
internal info usually comes from an analysis of internal reports on topics like budget and profitability. to better understand SW execs should seek firsthand info from key people throughout the company from workers to board of directors. info about external opps can be more complex bc they include current and potential issues which can be hard to predict. info about external factors can come from sources like the news, gov reports, customers and competitors.
potential internal strengths:
premium brand name
proven management team
lower costs/higher margins
Potential internal weaknesses:
low employee satisfaction
inadequate financial resources
potential external opps:
higher consumer demand
growth in foreign markets
potential external threats:
a powerful new competitor
a deep recession
new gov regulations
still in strategic planning
setting your goals
strategic coals rep concrete benchmarks managers can use to measure performance in each key area of org. most effective goals are:
specific and measurable: whenever possible, managers should define goals in clear numerical terms everyone understands
tied to a timeframe: to create a meaning and urgency, goals should be linked to a specific deadline
realistic but challenging: goals that make people stretch can motivate exceptional performance
ex-weak goal-improve customer satisfaction
powerful: increase avg customer satisfaction ratings to 4.5 by end of fiscal year
weak: reduce employee turnover -->powerful: retain 90% of new employees for 2+ years.
weak: increase market share-->powerful: become #1 or 2 brand in each market where we compete by end of 2016.
still strategic planning
creating your strategies
implementing your strategies
strategies are action plans that help the organization acheive its goals by forging the best fit between the firm and the environment. the underlying aim is to create a significant advantage vs competition. sources of competitive advantage vary from better product quality to better tech to more motivated employees. the specifics of strategy differ by industry and company but all strategies rep a road map. swot analysis determines starting point, the objectives signify immediate destination. bc speed matters, you must begin mapping next leg of journey before you arrive. for added complexity you never know when you'll come across an obstacle. meaning strategies must be dynamic and flexible. top managers have responded to this by encouraging front line managers to participate in the process more than before.
still strategic planning
implementing your strategies
evaluating your results and incorporating lessons learned
implementation should happen through tactical planning. middle managers in each area of company must develop plans to carry out core strategies in their area. if the strategic plan calls for more new products, marketing would need to generate ideas, finance would need to find funding, sales would need to prepare key accounts. all these steps would require tactical planning.
evaluation of results should be continual, handled by managers at every level as part of their controlling function. for evaluation to be meaningful, the lessons learned must be analyzed objectively and factored back into the next planning cycle.
Organizing: fitting together the puzzle pieces
organizing function of management means creating a logical structure for people, their jobs and their patterns of interaction. in choosing the right structure for a specific company, management typically considers many factors including goals and strategies of firm, products, use of tech, size, structure of competitors. given the change in these factors companies continually re examine their structure+make changes when necessary.
reorganizations and their purpose must be clear to employees throughout company. in order to help employees understand how they and their jobs fit within the broader org, most firms use an organization chart: visual representation of the companys formal structure
the formal structure matters but knowing how power flows on an informal basis could increase your effectiveness by helping you target your ideas to the right managers and marshal the support of the most influential employes.
Key organizing considerations
centralization, degree of centralization
in dvlping organizational structure, management must make decisions about the degree of centralization, span of management control, type of departmentalization that makes the most sense at any time.
the degree of centralization: extent to which decision making power is held by a small number of people at the top of the org.
the degree of centralization relates directly to the source of power and control. in centralized companies a small # of ppl at the top have the power to make decisions. its an efficient and simple approach, result tends to be a stong corporate image and uniform customer approach across front lines. downside is that centralized companies respond more slowly to customer needs and have lower employee morale. trade of may be worthwhile in steady stable markets, but its rare.
in todays env, most firms are moving towards greater decentralization, pushing power to the lower levels. employees with power to make decisions can respond to customer satisfaction more quickly and effectively. they can capitalize on opps that would likely vaporize in the time it would take to get permission to act.
for decentralization to work, every employee has to fully understand the firms missions,goals,strategy. otherwise it could develop a fragmented image which undermines its strength. active communication across departments is essential so all employees can benefit from innovations in other parts of the org.
Key organizing considerations 2
Span of control
the span of control or span of management refers to the number of people that a manager supervises. there's no ideal number that a manager supervises. the right span is based on the abilities of the manager and subordinates, nature of work being done, location of employees, and need for planning and coordination. across industries the trend has moved toward wider spans of control as a growing number of companies have pruned layers of middle management to the bare minimum.
Key organizing considerations 3
Departmentalization means breaking workers into logical groups. a number of diff options make sense, depending on the org.
Functional: dividing employees into groups based on area of expertise such as marketing, finance, engineering, tends to be efficient and easy to coordinate. for those reasons it works well w small-medium sized firms.
Product: dividing employees into groups based on the products a company offers helps workers develop expertise about products that often result in strong customer relations
customer: dividing employees into groups based on customers that a company serves helps companies focus on the needs of specific customer groups. many companies have separate departments for meeting needs of business and consumer users. this approach is related to product departmentalization.
Geographic: dividing employees into groups based on where the customers are located can help diff departments better serve specific regions within 1 country. similarly many international firms create a separate dpt for each diff country they serve.
process: dividing into groups based on what type of work employees do is common in manufacturing where management may divide dpts by processes such as cutting dying sewing.
as companies get larger they adopt several diff types of departmentalization at diff levels of the organization.=hybrid departmentalization.
line and staff organizations
a line organization typically has a clear chain of command from top to bottom. each person is directly accountable to the person immediately above, meaning quick decision making and no fuzziness ab who is responsible for what. downside is lack of specialists to provide advice or support for line managers. this approach tends to work for small businesses, but for med-large the result can be inflexibility, too much paperwork, and incompetence bc experts aren't available to give input into key decisions.
line and staff organizations: a line and staff organization incorporates the benefits of a line organization without all the drawbacks.
line managers supervise the functions that contribute directly to profitability: production and marketing.
staff managers supervise the functions that provide advice and assistance to the line dpts. ex legal, accounting..
in a line and staff org, line managers form the primary chain of authority. staff dpts work alongisde line dpts. but there is no direct reporting relationship (except @ top of company)
bc staff people don't report to line people, their authority comes from their know-how. this approach which overlays fast decision making w additional expertise, tends to work well for med-large companies. in some firms, the staff dpts gain so much power that they become dictatorial, imposing unreasonable limitations on the rest of the company.
matrix organizations build on the line and staff approach by adding a lot more flexibility. a matrix structure brings together specialists from diff areas of the company to work on individual projects on temp basis. a new product dvlpt team, might include reps from sales, engineering, finance, purchasing, advertising. for the course of the proj, each specialist reports to the project manager and the head of his or her dpt. matrix approach has been popular in high tech and aerospace industries.
matrix structure offers key advantages;encourages teamwork and communication across the org. it offers flexibility in deploying key ppl. it lends itself to innovative solns. when managed well, it creates a higher level of motivation and satisfaction for employees. the flip side is need for constant communication can bring down a company in too many meetings. the steady state of flux can be overwhelming for managers and employees. having 2 bosses can create conflict for everyone.
Leadership: directing and inspiring
free rein leaders
defining qualities of leaders can be complex bc successful leaders have a range of personalities, characteristics, backgrounds. researchers agree true leaders are trustworthy, inspiring, visionary. empathy,courage,creativity,intelligence,fairness.
autocratic leaders: hoard decision making power for themselves, typically issue orders w/o consulting their followers.
democratic leaders: share power with their followers. even though they make final decisions, they solicit and incorporate input from their followers.
free rein leaders: set objectives for their followers but give them freedom to choose how they wish to complete these goals. most effective leaders don't just use one approach, they'll shift their style depending on the followers and situation.
when a quick decision is paramount, autocratic may make most sense. army officer for example shouldn't take a vote on whether to storm a hill in the middle of a firefight. but when creativity is top priority, during new product brainstorming, free rein would probably be best. likewise a new worker might benefit from an autocratic but friendly manager, while a talented experienced employee would work best under free rein. a vital consideration is customer. when the customer seeks consistency in the delivery of a product-ex in fast food- the autocratic leadership style may be appropriate. but when the customer needs flexibility and problem solving assistance-a consulting client-free rein.
democratic leadership style typically provides customers w a balance of consistency and flexibility which works w a wide range of industries.
Controlling: making sure it all works
least glamorous of management functions but important.
means monitoring performance of the firm or individuals within it, and making improvements when needed. as env changes, plans change. as plans change, control processes must change too to ensure the company achieves its goals.
control process includes 3 steps:
establish clear performance standards
measure actual performance against standards
take corrective action if necessary.
establishing clear standards/performance goals begins w planning. at every level of planning, objectives should emerge that are consistent with the companys mission and strategic plan. objectives must be specific and measurable, realistic but challenging, tied to a timeframe.
individual managers may need to break these goals into smaller parts for certain employees, but subgoals should retain same 3 qualities as original objective.
measuring performance against standards should happen before the end of the timeframe attached to the goal.
strong info tracking system is probably managements best tool in this phase of control process.
if the company or individual isn't on track to meet the goals, managements first response should be communication. employees w full info are likely to improve their performance than those who never know they're falling behind. sometimes workers need more than info they may need additional resources or coaching to meet their goals. if they still don't succeed, the goals may need to be re examined. given the expense in human+financial terms, disciplining employees for poor performance should come after exploring the reasons they didn't meet the goals, and making changes if necessary.