Handout for Management 101Drew Carton

HANDOUT FOR MANAGEMENT 101 FINAL This handout contains all of the concepts you will be responsible for knowing for the final exam. The outline follows the order that material was presented throughout the course. You are responsible for all concepts listed in this document. However, for bullet point that begins with example from class or example from recitation, you are only responsible for it if it is underlined. If a bullet point is not preceded by example from class or example from recitation, then you are responsible for knowing it because it is a key course concept. Ive provided detailed summaries of concepts that were introduced in class yet that do not appear in the text (typically because they are based on research that has just been published in the last few years or examples that have taken place recently). For concepts that appear in the text, Ive pointed out the page(s) that you can find the information. In some cases, the topics introduced in class include ideas that were not covered in class but are covered in the book. This is important to keep in mind when you are comparing your slides to this handout. For instance, I did not cover one attribute of job design in class (skill variety) that is listed below and that you will be responsible for on the final. Ive put the exercises/cases from every recitation as examples to highlight how the recitation material ties to the course concepts. However, as noted above, you are only responsible for something labeled example from recitation when it is underlined. For those of you who would like to do further reading, please let me know if you want references for any of the concepts below. Good luck!

Handout for Management 101Drew Carton FORMULATING STRATEGY IN TEAMS

Hidden profiles Teams can make suboptimal decisions because members focus on information that is commonly held and do not share privately held information. This is similar to the common knowledge effectgroups tend to favor information that is shared rather than uniquely held. Example from class: In an experiment, Gary Stasser and William Titus had a group of judges work through several candidates for a student government position. Although it was clear based on all of the available information that Candidate A was superior to Candidates B and C, it appeared as if Candidate B was superior to Candidates A and C based on the information that the judges had in common. Since groups tend to share information that they have in common, the groups more often than not chose inferior candidates. In short, people are primed to discuss issues that other people before them have already brought up. Tradeoff between efficiency and effectiveness Even when you have the power to make decisions quickly, when a task is complex it is important to patiently let the decision making process in teams play out so that enough perspectives have been exchanged. A diverse array of perspectives, knowledge, and skills are only useful for team decision making to the extent that those perspectives are shared and re-combined. If decisions are made too quickly (efficiency is valued), then decision quality (effectiveness) is likely to be sacrificed. Example: the hierarchical team structure at IDEO is very flat because teams at IDEO favor effectiveness over efficiency. The project leaders do not make decisions for the team. Decisions are only made after the team has finished deliberating. The way that team members are configured has important implications for whether teams exchange enough information to perform effectively. Teams that have equal sized subgroups (wherein the subgroups are based on expertise or knowledge), tend to be more effective and less efficient because the knowledge possessed by both subgroups is equally considered; that is, the perspective of one subgroup does not dominate the other. Example from recitation: For the Dartmouth Reports case, the teams with equal sized subgroups performed better than teams in which there was one large numerical majority and one small numerical minority. Coalition building When you lack power to make decisions in teams, it is often useful to build coalitions. When building coalitions, you can threaten the power of whoever is in charge by using power in numbers. Since a persons continued hold on power

Handout for Management 101Drew Carton

requires that a subordinate set of people believe this persons right to power is legitimate, then coalition building can be used to question the legitimacy of someones hold on power simply because it signals that the coalition does not believe the power is legitimate or deserved. Further, the person who is in charge may be compelled to conform to the opinion of the coalition because of social proof. Social proof is the tendency to believe that an action or decision is correct or effective because a critical mass of people buy into it. Brainstorming It is important not to evaluate ideas too early in the brainstorming process for two different reasons. First, when people feel that their ideas are being evaluated, they are likely to be hesitant to offer new ideas. This is a form of conformity. Second, if ideas are evaluated as bad too early in the process, then they are likely to be thrown out rather than kept in the pool for consideration. It is important to keep bad ideas in the consideration pool, because oftentimes very bad ideas can be the jumping off point to brilliant ideas. It might be the case that a suboptimal solution is precisely the bridge needed between the status quo and an ingenious solution. Humans think associativelythat is, they tend to come up with new ideas by building on previous ideas. It is entirely possible to build off a bad idea to come up with a great idea. This is especially true early in the brainstorming process. Thus, groups should keep bad ideas in the consideration set during the early stages of brainstorming. Group conformity People are hesitant to speak out because they are worried about being publically shamed or humiliated. As shown in experiments by Solomon Asch (a former Penn psychology professor), individuals will oftentimes conform to a groups judgment or opinion even when they know that it is wrong. One way to prevent conformity is to assign a devils advocatesomeone who must present an opposing viewpoint during the process of making a group decision. Groupthink often results from conformity. Read the definition of groupthink on bottom of page 256 of the text. The text discusses groupthink in the context of social networks, but the conceptualization is the same in teams. Example from class: the role of Arthur Schlessinger, Jr. before the decision to invade the Bay of Pigs. Although Schlessinger had a dissenting viewpoint, he shrunk back in his chair during board meetings. FORMULATING STRATEGY IN DYADS

The importance of making independent judgments

Handout for Management 101Drew Carton

It is best for individuals to come up with judgments independently before attempting to integrate their point of view with someone elses. Oftentimes when people seek feedback, they enter into a discussion with another person before having arrived at an independent judgment. This induces mental contamination. Mental contamination is based on anchoringa person anchors on the other persons judgment and does not sufficiently adjust from that judgment. When two judgments are further apart from each other, they are more likely to bracket the truth. Example from class: two predictions about where the stock market will be in five years will more likely bracket the truth if they are further apart from one another. Bracketing occurs when one estimate is on one side of the truth and the other estimate is on the other side of the truth. When two opinions bracket the truth, then averaging those opinions will lead to a final estimate that is closer to the truth than judgments of either of the original people. Interests versus positions in negotiations When negotiating with others, focus on interests rather than positions in order to discover integrative (win-win solutions). Even if two individuals/parties have opposing positions, it could be the case that they have complementary interests. Example from class: Egypt versus Israel in negotiations over the Sinai Peninsula. Both Egypt and Israel claimed the Peninsula for themselves and appeared to be headed for war. During negotiations, it became apparent that they wanted the peninsula for different reasons (i.e., they had different interests). Egypt wanted sovereignty over the land whereas Israel wanted security from the threat of attack. They reached an agreement wherein Egypt claimed the peninsula as long as they demilitarized it (e.g., removed tanks). Comprehension focus versus Persuasion focus You can adopt two different orientations when listening to someone else. You can attempt to learn from them (a comprehension focus) or attempt to find a hole in their logic and thus persuade them that they are wrong (a persuasion focus). Example from class: video clip of Kevin Sharer, CEO of Amgen. Sharer talked about his personal transformation from a persuasion focus to a comprehension focus as he advanced in his career. Homophily The tendency for people to gravitate to others who are similar to them. This can be problematic for decision making because likeminded people tend to think about things in a very similar way. The lack of diversity in perspectives can harm decision making. FORMULATING STRATEGY AT THE INDIVIDUAL LEVEL

Bounded information processing

Handout for Management 101Drew Carton

Humans have limited information processing capability. We can only handle so much information at a given time. Thus, we rely on heuristicsmental shortcuts that allow us to use make decisions and draw conclusions based on limited information. Heuristics can often fail in systematic and predictable ways. One common and important heuristic is the availability heuristic. We tend to estimate the frequency of an event based on how readily that event comes to mind. Example from class: people often think that plane crashes are more frequent than car accidents even though car accidents are much more frequent. This is because plane crashes come to mind more easily for most people. Another heuristic is termed inattention blindness. In order to achieve goals, we tend to block out distractors. We acquire tunnel vision and lose situational awareness. Slippery slope problem It is difficult to draw a line between what is fair/just and what is unfair/unjust. Example from recitation: at what point can someone say that Ford had done enough to make the Pinto safe? What is enough? Technology existed to ensure that the Pinto would not explode after impact, however if Ford employed all of this technology, then it would not be able to put a competitive car on the market. Further, the Pinto would no longer be a Pintoit would better resemble a tank than a car. When is enough enough? Temporal construal People tend to think about the immediate future in concrete terms and the distant future in abstract terms Example from class: I asked a few of you what you (1) planned to do tomorrow versus (2) what you planned to do in 5 years. Plans for what to do in five years (e.g., advance my career) tended to be more abstract (i.e., less concrete) than plans for what to do tomorrow (e.g., finish a paper). Time unpacking People make more accurate predictions of the future when they are prompted to unpack time. In particular, individuals become less overconfident when making predictions of the future if they use time unpacking. When they are first asked to make estimations about more proximal events, they create broader confidence intervals for less proximal eventslarger value ranges that they believe could possibly be realized. Example from class: I asked one person to predict where the Dow Jones would be in three years. I then asked a second person to make the same predictionbut I asked this second person to unpack time by first making predictions about where the stock market would be in 6 months, where the

Handout for Management 101Drew Carton

stock market would be in one year, and where the stock market would be in two years. The person who unpacked time typically ended up offering wider (and thus more conservative) confidence intervals, whereby a confidence interval is a specified range of values (minimum value to maximum value) that a person is confident the Dow Jones will fall within. Value tradeoffs A value is a concise summary of a principle that guides decision making and behavior across time and across situations. Ethical decision making typically involves conflict between two or more core values. Example from class: the trolley problem involved two competing values. A utilitarian perspective (spreading the greatest amount of good across the greatest number of people) would favor pulling the lever, while a rights-based perspective (i.e., deontological, or adhering to an individuals rights) would favor not pulling the lever because the person is altering the course of an event that he/she knows little about. Example from class: fracking in North Carolina. Lawmakers in the Summer of 2013 felt torn between a utilitarian value (requiring everyone to sell the natural gas flowing underneath their land in order to prevent neighbors from stealing others natural gas and to limit harm to the environment) and a rightsbased value (that it is not fair to require anyone to sell a resource that flows underneath his/her own private property). See also pages 54 55 of text for a description of utilitarian rule and moral rights rules. FORMULATING A CHANGE IN STRATEGY

Destination postcard A vivid representation of a day in the future. A destination postcard counteracts the tendency to think about the future in overly abstract terms. People are more apt to realize the need for change when they can see a future state in very concrete terms. Example from recitation: you worked through several different ways to conjure concrete images of the distant future. Three examples are: (1) avoiding the usage of numbers, (2) focusing on the experience of end-users, and (3) the picture-on-the-office-wall test

Handout for Management 101Drew Carton

IMPLEMENTING STRATEGY AT THE INDIVIDUAL LEVEL PERMA There are five elements of well-being that people choose to pursue for their own sake. Most people set goals and take action in order to trigger Positive emotions, achieve Engagement in a task (i.e., flow), build Relationships, achieve Meaning, and/or Accomplish great feats. Person-job fit The extent to which your personality and, especially, your motives align with your job specifications Job crafting The process of redefining and reimagining your job in ways that increase its meaningfulness and bring your job more in line with your desired identity. Job crafting can happen in 3 ways: Changing tasks (adding a new responsibility, spending more time on one aspect of the job than the other), changing relationships (interacting with people you like and admire more often, avoiding the people you dont like), and changing perceptions (thinking about your work tasks differently, or reframing the job as a whole). Example: recitation paper Example from recitation: Candice Billups Work orientation There are three distinct ways to orient toward a job: a job orientation, a career orientation, and a calling orientation. Individuals who have a career orientation tend to veer toward either having a job orientation or a calling orientation as their career progresses. Goal specificity Goals lead to stronger performance when they are specific and difficult Example from class: people will be more likely to achieve a New Years Resolution if they adopt a very specific outcome they hope to achieve (e.g., be able to run 10 miles) by a specific date (e.g., March 15) Dual reference points The least motivating part of a task is the middle phase. There are two dominant reference points when people work on a task: the beginning of the task and the end of the task. When people are close to one reference point, they are motivated because they can more easily chart their progress relative to that reference point. When they are further from either reference point (i.e., the middle), it becomes more challenging to stay motivated. Motivation researchers used prospect theory (a theory of decision making under risk and uncertainty) to identify the dual reference point effect.

Handout for Management 101Drew Carton

Example: we discussed in class about how the lull in the middle of a semester or work week is best described by the dual reference point effect

IMPLEMENTING STRATEGY IN DYADS Theory X versus Theory Y The assumption that workers are inherently lazy versus the assumption that they want to be passionate about their work. The theory to which a manager subscribes will drive the tactics he/she adopts to motivate workers. In short, managers who believe in Theory X will motivate workers via incentives (extrinsic motivation) and monitor them closely, and managers who believe in Theory Y will motivate workers via identity (which is tied to intrinsic motivation) Intrinsic motivation (page 211 of text) Extrinsic motivation (page 211 of text) Incentives Incentives get people to do things they otherwise wouldnt do (e.g., the jumping jacks exercise in class). Very useful in certain circumstances (e.g., when the desired behavior is clear and stable); however, they have a dark side. They can: undermine intrinsic motivation Example from class: several studies show that paying someone to do a task that they enjoy will decrease their enjoyment of the task promote unethical behavior. When an outcome is rewarded, the processes that people use to attain the reward may need to be monitoredespecially when one route to attaining the reward is substantially less difficult than another route example from class: performance enhancing drugs in sports incentivize the wrong behavior. Please choose and remember any 2 examples from Steve Kerrs article On the Folly of Rewarding A, while Hoping for B (assigned reading) Furthermore, its very difficult to come up with a fair approach to weighing different quantitative and qualitative metrics. Toward this end, it is important to know the definition of job analysis (the first paragraph of page 155 in the text). Example in recitation: many of you had differing opinions on how to weigh criteria for the RAISE exercise. Prosocial motivation (page 212 in text) Expectancy theory Expectancy (pages 213 214 of text) Instrumentality (page 215 of text) Valence (page 215 of text) Managing based on authenticity

Handout for Management 101Drew Carton

During the socialization process (the first few months in an organization when employees are going through orientation and training), most organizations focus on helping workers see how their values should align with the values of the organization. However, motivation increases when workers are encouraged to act more authentically. Example from class: research showing that turnover was cut in half in a company in India when workers were encouraged to think of themselves when they were at their best rather than focusing on how their values were congruent with the organizations values. The power of language Using nouns can be more motivating than using verbs. The usage of nouns converts a behavior that is detached from the self-concept into a way of being (i.e., a consideration of identity, or the kind of person I want to be). Example from class: research showing that individuals who were asked whether it was important to be a voter were 13.7% more likely to vote than individuals who were asked whether it was important to vote. Example from class: children who were asked if they wanted to be helpers performed 50% more chores around the house than children who were asked if they wanted to help Example from class: In order to promote innovation, Brasilata (a Brazilian manufacturing company) refers to its employees as inventors. This is distinct from asking employees to invent new solutions. Job design Job design is the process by which managers decide how to divide tasks into specific jobs. One model of job design is Richard Hackmans and Greg Oldhams job characteristics model (pages 153-154 of text). The model specifies dimensions of a job that contribute to employees interest and motivation in the work. Youll need to know the following four for the exam. skill variety (top of page 154 of text) task identity the extent to which an employee is involved in the construction of each step of a task (this is the texts definition on page 154 in the text). It also can be the extent to which an employee is aware of the final form or complexion of a product or service that they helped create/generate. Example from class: employees who watched the plane take off with the engine that they made Autonomy the ability to control ones work or working environment Example from class: people given a flex schedule (the ability to choose their hours) chose a work schedule that was only 8

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minutes different from those who had a rigid schedule. However, they were more satisfied at work. Task significance an understanding of how the products and services that we create improve the lives of end-users. Also see page 154 of text. Example from class: how Facebook workers heard testimonials from beneficiaries, including a man who worked in the army and was away from his family and community for two years. He commented that Facebook gave him the opportunity to see his kids grow up. Example from class: Call center performance was boosted between 100% and 500% in a number of studies in which a beneficiary (a student who received a scholarship based on funds raised at the call center) came in to give a brief speech about how the work of the call center employees substantially improved his/her life and gave him/her opportunities that he/she otherwise would not have. Illusion of transparency People believe they are communicating more clearly than they are, and important underlying assumptions can be missed because they are never explicitly stated or discussed Example from class: the pencil tapping exercise in class (Twinkle Twinkle Little Star). We think were singing when were just tapping. Example from class: 90% doesnt work t-shirt this phrase could be interpreted in different ways. It was interpreted by employees in a way that was not intended by Michael, the CEO of the company, who was the one who distributed the t-shirt. IMPLEMENTING STRATEGY IN TEAMS

Task type Additive task When all group members perform the same job and group performance is a sum of individual performance Conjunctive task Group performance is disproportionately dependent on the weakest member. This is often the case when group work is highly interdependent. That is, the ability for one person to perform his/her task depends greatly on the ability for someone else to do his or her task. Disjunctive task

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Group performance is disproportionately dependent on the strongest member. This is the case when one very intelligent or skilled person can solve a problem for the entire group. Phases of teamwork There are many models of the phases of teamwork. One simple yet compelling framework is a two-stage model: formulationimplementation It is important not to spend too much time during the formulation phase of teamwork because it is often impossible to anticipate all relevant threats and opportunities during the implementation stage. If time and resources are flexible during the implementation stage, then teams can more easily re-orient themselves. Example in class: the spaghetti-marshmallow task. Teams that devoted more time to the implementation stage had an easier time reacting to crises when they surfaced (i.e., time to build a new structure when an existing structure collapsed). Team conflict Conflict involves the expression of differencesin particular, when individuals have competing goals. Since conflict is based on the expression of differences, it is important to understand the nature of differences. David Harrison and Katherine Klein identify three types of differences that tend to lead to conflict: separation (values, beliefs, social categories), disparity (resources, such as power, status, and wealth), and variety (information and knowledge). Thus, there are three types of conflict. Separation is most potent when teams are bipolarizedthere are two cliques that take opposite positions according to some deeply held belief or value. Disparity is most potent when one member has possession of all resources and all other members are disenfranchised. Variety is most potent when every member possesses distinct information or knowledge. When each type of difference is most potent, conflict is most likely. The type of conflict management depends on the type of conflict. Here is one example that you should know for each. Conflict does not necessarily have to be bad. It depends on how it is managed. Practitioners have attempted to use superordinate identities to bridge divides when there are schisms based on identity. However, this has received mixed support because people tend to identify much more strongly with subgroups than with superordinate groups. Procedural justice (a more transparent process and voicethe opportunity to bring up grievances) is useful for legitimizing power differentials. This can quell conflict based on disparity.

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When there is conflict based on variety (competing perspectives on how to solve a problem), boundary spanning can promote better quality exchanges. Conflict based on variety (often known as task conflict) is the type of conflict that is most likely to be good for teams because it ensures that diverse perspectives are being exchanged and combined. If it is managed properly, then team performance can be boosted. IMPLEMENTING STRATEGY IN UNITS

Identity fragmentation There are a series of thresholds of group size at which it becomes difficult for individuals to find a sense of attachment to a group. Individuals strongly prefer to organize into groups of 2 to 3 people. Observational studies show that most naturally occurring groups are between 2 and 3 members and are rarely larger than 6. Individuals have a very difficult time finding any sense of attachment to groups that are larger than 150 members (close to the Dunbar number). As a result, the identity of a unit tends to fragment into much smaller identities. The best way to counter identity fragmentation is through a strong culture (see below). Multi-team management In units, the processes and outputs of multiple teams need to be coordinated to meet unit objectives. Thus, it is important not to study teams in a vacuum. Rather, the context in which teams operate is very important to consider. Although it is often best for teams to be de-centralized because unique areas of expertise are more likely to be combined, it is often best for units when teams are centralized around a team leader or a point-person. That is, information is funneled toward one actor and one actor has the ability to make decisions or coordinate with other teams. Example from recitation: In GlobeSmart, the German team and the U.S. team were de-centralized in that there were no clear leaders of either team who were designated to ensure proper information flow between the two teams. The lack of coordination between teams exacerbated the illusion of transparencysometimes team members take for granted that their instructions are being interpreted in one way (e.g., measurement according to the metric system, which is what the German team was using) when they could be interpreted in another way (e.g., measurement according to the English system, which is what the U.S. team was doing). In the real life case (the Mars Orbiter disaster), the lack of coordination between de-centralized teams led to the loss of a nine-figure satellite. In this type of situation, it would be best to have leaders who were explicitly designated to coordinate between the two teams. Social networks

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Know the definition of social network analysis (middle to bottom of page 251 of text) Structure of networks Density the number of actual ties to potential ties Centrality the extent to which ties funnel through one member Examples of combinations of density and centrality Wheel: low density, low centrality Core / Periphery: low density, high centrality Full tie: high density, low centrality Example from class: Antarctic survival exercise Structural holes Open areas between two networks. Individuals who span structural holes have the greatest potential for creativity and have the most social and political capital. See the middle to the bottom of page 253 of the text Example from class: Larry Crainich was the best innovator in one organization. He spanned multiple structural holes. Although spanning structural holes benefit small teams (because spanners can act as gatekeepers who filter essential information across subgroup divides) and for the individual spanners themselves, the bridging of structural holes between two highly complex networks can lead to highly inefficient communication patterns at the level of the unit because of bottleneckinglogjams of information that do not pass smoothly from one network to the other The section labeled Power on page 256 of the text nicely summarizes how individuals who span structural holes (what the text calls brokering) can accrue a variety of resources, including power See also Holes in the network from page 111 of Krackhardt and Hansen Content of networks Difference between advice networks and trust networks See page 105 106 of Krackhardt and Hanson reading. External knowledge sharing is often more valuable than internal knowledge sharing because it means that different perspectives are being pulled into the network. However, external knowledge sharing is more valuable when external connections are to actors who are structurally diverse rather than demographically diverse. Although actors who are demographically diverse often provide alternative points of view, actors who are structurally diverse provide perspectives that are especially diverse because they are embedded in entirely different knowledge networks.

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Structural diversity maps on closely to variety from Harrison and Kleins typology. Examples (please remember one of these four for the final exam; you can pick any of the four): Business unit Reporting channel Functional area Geographic location Demographic diversity maps on closely to separation from Harrison and Kleins typology. Examples are (please remember one of these two for the final exam; you can pick either of the two): Age Gender External knowledge sharing often occurs when people build bridging relationships, a concept that is defined on page 252 of the text. Bridging relationships are equivalent to brokering, which is what happens when people span structural holes. T-shaped management In order to build linkages between networks, it is critical to have some general understanding of different domains of knowledge (the horizontal part of the T) while retaining expertise in one area (the vertical part of the T) Read the second half of the second-to-last paragraph on page 254 of the text IMPLEMENTING STRATEGY IN ORGANIZATIONS

The need for organizational design and organizational culture Organizations need to control and coordinate a massive number of subcomponents at lower levels (e.g., units, team projects, individual jobs). They do this via design and culture. Organizational design Definition: how the organization structures roles, tasks, jobs and projects into formal reporting channels and information channels Centralization Pages 170 171 in text Example from recitation: ACS case Functional structure Each unit is responsible for a particular specialization (e.g., engineering, marketing, finance) See pages 156 157 in the text Divisional structure

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Each unit is run as if it is its own company. Each unit serves one product or market segment See pages 158 162 You should know all three types of divisional structures (product, geographic, market) Liaison roles Page 173 in text Cross-functional teams Page 174 of text Know the definition of span of control on page 166 of text The minimum chain of command on page 169 of the text It is important that the organizations design is aligned with elements at lower levels of analysis. For instance, incentives and performance evaluation). For a very similar idea that speaks to how rewards should also be consistent with culture, see page 238 of the text Example from class: Microsoft switched from a divisional to a functional structure in July of 2013. However, this led their organizational design (which requires cooperation between functions) to be misaligned with the performance evaluation system, wherein employees were ranked relative to one another such that certain employees had to be ranked as poor or very poor. The CEO, Steve Ballmer, just recently eschewed this performance evaluation system because of the misalignment. Organizational Culture Definition: a set of shared schema that determine acceptable and unacceptable behavior Pages 222 225 in the text. Norms for how to act are stickythey often remain after the reason for their emergence has disappeared and after the original people that put those norms in place have left the organization. This is an example of how culture embeds itself into organizational memory A strong culture is one in which there is a simple value system, values and norms are widely shared (prevalence), and values and norms are strongly held (intensity). Examples from class: Disney (ensuring a magical experience for guests), Four Seasons (doing whatever it takes to ensure that guests have a great experience), Southwest Airlines (embracing authentic behavior, such as the rapping flight attendant), and casinos (live in the moment) Manifestations of a strong culture Verbal (stories, jargon) Behavioral (norms, ceremonies, rites of passage e.g., hazing) Physical (dress code, uniforms, objects, office layout)

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Example from class: Pixar Example from class: Your ideas for shaping the environment to induce collaboration (e.g., round tables versus long tables, white board space, windows on cubes) Example from class: a clean environment induces more ethical behavior Read Deciphering Culture Through Artifactspages 228 230 in the text A strong culture is valuable for a few reasons: Intrinsic motivation control: sometimes invisible but still effective (e.g. decision rules, norms, codes of conduct) Read control on bottom of page 230 of text cooperation: social glue Read social glue on page 231 of text cost Oversight and direction are not as necessary as they would be in an environment without a strong culture. Inexpensive but highly valued rewards (e.g., significance, identity, peer support, job titles) Attraction-selection-attrition theory Page 239 of the text. This is very similar to person-job fit. Organizations tend to attract and retain employees who see a better fit between their work and their values/core motives. Merging organizational cultures Pages 234 236 of text Definition of organizational socialization Top of page 240 IMPLEMENTING A CHANGE IN STRATEGY

Change is necessary for organizations to remain competitive. All organizational change requires that individual behavior be changed. The conventional wisdom in change management has long been that employees are typically resistant to change. This conventional wisdom was reinforced by the observation that individuals often do not follow through or persist when they are asked to change. It has been assumed that employees are inherently lazy or resistant to change. In their book Switch, Chip and Dan Heath suggest that the conventional wisdom is wrong. It is not the case that individuals are lazy when they fail to follow through with expectations or instructions to change. Instead, they very easily become exhausted. This is due to finite reserves of self-control. Self-control is the ability to consciously direct behavior or override impulses (whether these impulses are based on instinct or habit) in order to learn new

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knowledge, skills, or abilities. As shown in the Marshmallow Experiment and the described in the experiment on participants who were asked to watch videos of pets and to not express their emotions, self-control is difficult, exhausting, and depleting. When people try to learn new skills, they initially feel awkward and vulnerable (consider the handwriting task from class on December 2). The Heath brothers ask how we can better tap into peoples finite reserves of self-control so that they can be triggered to act and persist as they try to learn new knowledge, skills, and abilities. There are three basic ways that managers can do this. We covered two of them on December 2. We will cover the final one on December 9. How we frame change. Do we frame change as something that is necessary for survival (and therefore likely to be construed as a threat) or something that can provide a novel experience and a challenge? o Chip and Dan Heath argue that framing change as necessary for survival (the burning platform approach) leads people to narrow their focus, become paralyzed by fear, and take self-protective measures. o However, research in neuroscience suggests that the neurological chemicals that drive the experience of satisfaction (dopamine and cortisol) are driven by two characteristics of change: novelty (which is exposure to new stimuli) and challenge (the difficulty of a task). Thus, framing change as novel and challenging can determine whether employees embrace or dread change. Stretch goals are an example of how to frame change as both novel and challenging. Stretch goals are goals that are seemingly impossible to achieve given current means, capabilities, skills, and expertise. Stretch goals thus force workers to think outside of the box and develop innovative new solutions and capabilities. As long as workers are given enough slack resources and the opportunity to experiment, stretch goals can be exciting to pursue as well as a boost for performance. Stretch goals are extremely challenging and require individuals to think of novel solutions. As noted above, this taps into the two factors that drive the release of dopamine and cortisol. Example from class: Stretch Goal at Velocity (i.e., Southwest Airlines). Analyze/Think/Change versus See/Feel/Change. How well we provide evidence that makes people feel something rather than consider something analytically. This is described on pages 105 107 from Find the Feeling from Switch. o Example from class: The solution you came up with for the exercise at the end of class (e.g., how to make kids stop drinking sweetened soft drinks). Small, frequent appeals to identity often work effectively to reinforce a core value that you want others to internalize. Individual identity is highly malleable; we adopt new identities throughout our lifetimes. Small and frequent appeals can make individuals more likely to internalize the values that are embodied by a change effort.

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Change can also be achieved by simply changing the situation in which employees work. The Heath Brothers call this Shaping the Path. There are different ways to shape the path. Tweaking the Environment involves changing the organizational context (e.g., structures, machines, or office layout) in a way that brings about desired change. Oftentimes, the environment is the most important driver of behavioral change. For instance, in a study that looked at peoples eating habits, individuals who were asked to eat soup from a bottomless bowl (the bowl continued to be refilled) ate 73% more soup than those who ate from a normal bowl (the control group); however, they did not report feeling any more satiated than the control group. o Example from class: health officials in Stockholm, Sweden constructed the Piano Steps. Building habits involves outsourcing peoples limited self-regulation to the environment. Rather than leaving people to directly monitor their own behavior, they can use cues from the environment to signal when they should engage in a desired behavior. One of the best ways to do this is through implementation intentions, in which individuals clarify the contingency, time, and location that will remind them to engage in a particular behavior. o Example from class: Clinicians were interested in helping patients with epilepsy take their medication on time every day. Those who created implementation intentions (e.g., If it is 8 oclock and I am in the bathroom and I have just brushed my teeth, then I will take my medication) were substantially more likely to take their medication on time than those who were merely encouraged to take their medication on time by physicians. o Example from class. The pilots checklist. Change at the organizational level typically follows a series of predictable phases. The Scurve and Kotters Eight-Step Model of Change provide two different synopses of these phases. The core notion of the S-curve is that change is typically pioneered by a small minority and does not become large-scale change until a significant number of bystanders are prompted to change. When this occurs, change happens very rapidly. Ultimately, there are likely to be certain individuals who resist change. Kotters model articulates several stages. He suggests that each of these stages needs to be followed in sequence. When managers attempt to exact certain changes (e.g., institutionalizing new approaches) before more fundamental changes (e.g., communicating a vision) are completed, then Kotter argues that the entire change effort could implode. Kotters model nicely summarizes the entirety of change because it captures how a change in strategy needs to be formulated and communicated before strategy can be successfully implemented.

Handout for Management 101Drew Carton THE THEMES OF MANAGEMENT

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The distinction between knowledge, resources, and identity (how we think, what we have, and who we are) can capture many issues that managers face. For the final exam, please know the following: o Knowledge: Since people are limited information processers, they rely on heuristics in order to make decisions. Many of these heuristics (e.g., the availability heuristic, the vividness heuristic, and the identifiability heuristic) lead people to put a heavy emphasis on a very small amount of information at the expense of a large amount of informationeven when the large amount of information would lead them to make better decisions, simply because large samples tend to be more accurate than small samples. This is a paradox of communication and social influence: a small amount of vivid information is often much more influential than a large amount of data, even if the data would lead people to make better decisions. o Resources versus Identity: It is typically easier to influence employees to initially perform an activity, complete a task, or change when they are given an incentive or the opportunity to acquire status, power, prestige, or a career advancement (this relates to influence via resources). However, an effort to influence someone is often more profound and long-lasting when they have internalized the motive or value that is tied to the behavior (this relates to influence via identity). Further, we have discussed occasions when motivating people through resources can undermine your ability to motivate them through identity. This is yet another paradox of social influence: oftentimes the factor that can most easily induce someone to act in a desired manner (resources) can undermine the factor that will sustain their investment (identity). We examined managerial phenomena throughout this class at each level of analysis in the organization. It is critical that the way the organization is run at one level matches the way the organization is run at other levels. This notion of fit is essential to most theories of organizational management. When processes, practices, routines, and philosophies at one level do not match those at another level, the organization is likely to experience negative consequences. o Example from class: I reminded you of the mismatch between Microsofts new organizational design (effective July 2013) and their performance review system. Please see Page 15 of this study guide.

BEST OF LUCK ON THE FINAL EXAM!!!