Part One: Overview

Chapter 1: Management and

Its Evolution

Chapter 2: Managing in a
Global Environment

Chapter 1
Management and Its Evolution

Management Challenges

After reading this chapter, you should be able to:

Specify the roles of the various individuals, teams, and managers responsible for managerial activities within the firm. Understand the four major functions of management, and how individuals, teams, and managers carry them out. Identify the general skills needed to carry out managerial responsibilities. Appreciate early management thought as a foundation for classical, behavioral, and contemporary management perspectives.
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Management Challenges (continued)

Explain the major elements of classical and behavioral management perspectives. Describe the significance of the Hawthorne studies and their application to the human relations approach to management. Explain the key components of systems theory and contingency theory. Describe the basic concepts of the learning organization approach.
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The performance of organizations depends to a large extent on how their resources are allocated and their ability to adapt to changing conditions. Successful organizations know how to manage people and resources efficiently to accomplish organizational goals and to keep those goals in tune with changes in the external environment.

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Management in the New Millennium

A firm can be efficient by making the best use of people, money, physical plant, and technology. It is ineffective if its goals do not provide a sustained competitive advantage. A firm with with excellent goals would fail if it hired the wrong people, lost key contributors, relied on outdated technology, and made poor investment decisions.
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Management in the New Millennium (continued)

Traditionally, the term management referred only to individuals responsible for making resource allocation decisions and with the formal authority to direct others.

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Levels of management:
Strategic Managers

Tactical Managers

Operational Managers

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Strategic Managers

The firms senior executives with overall responsibility for the firm.
Developing

the companys goals Focus on long-term issues Emphasize the growth and overall effectiveness of the organization

Concerned primarily with the interaction between the organization and its external environment.
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Tactical Managers

Responsible for translating the general goals and plans developed by strategic managers into specific objectives and activities.
Shorter

time horizon Coordination of resources

These are middle managers

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Operational Managers

Lower-level managers who supervise the operations of the organization. Directly involved with non-management employees
Implementing

the specific plans developed with tactical managers. This is a critical role to the organization. Operational managers are the link between management and non-management staff
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The Four Management Functions

Planning Organizing

Leading

Controlling

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Planning:

The management function that assesses the management environment to set future objectives and map out activities necessary to achieve those objectives. To be effective, the objectives of individuals, teams, and management should be coordinated to support the firms mission.

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Organizing:

The management function that determines how the firms human, financial, physical, informational, and technical resources are arranged and coordinated to perform tasks to achieve desired goals. The deployment of resources to achieve strategic goals.

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Leading:

The management function that energizes people to contribute their best individually and in cooperation with other people. This involves:
Clearly

communicating organizational goals Inspiring and motivating employees Providing an example for others to follow Guiding others Creating conditions that encourage management of diversity
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Controlling:

The management function that measures performance, compares it to objectives, implements necessary changes, and monitors progress. Many of these issues involve feedback or identifying potential problems and taking corrective action.

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Management as a set of skills:

The four basic management functions require a set of skills to be carried out properly. Because most managerial tasks are unique, ambiguous, and situation-specific, there is seldom one best way to approach them.

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Management as a set of skills: (continued)

Four major categories of skills will help you become a good manager:
Strategizing

Skills

Task-Related

Skills
Skills Skills

People-Related Self-Awareness

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Strategizing Skills

Strategizing involves the ability to see the big picture to:

Focus

on key objectives without getting mired in details Sense what is happening inside and outside the company Respond in an appropriate and timely fashion

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Task-Related Skills

Involve the ability to define the best approach to accomplish personal and organizational objectives. They include consideration of all resources, including:
Time Organizational

structure Financial resources People

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Task-Related Skills (continued)

They also involve the ability to:

Prioritize Remain

flexible to make changes if necessary Ensure that value is being created

In contemporary organizations, task-related skills are demanded of most employees from factory workers to top executives.

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People-Related Skills

Involve getting work done through others and with others. People skills include the ability to:
Delegate

tasks Share information Resolve conflicts Be a team player Work with people from very different backgrounds
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Self-Awareness Skills

Being aware of your personal characteristics can help you adapt to others.
To

also help you understand why you react to them the way you do.
Avoid

rushed judgments Appreciate the nuances of particular situations Size up opportunities Capitalize on your personal strengths Avoid situations in which you are likely to fail
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Skills for Managerial Success

Strategic Skills

Task Skills

Environmental assessment scanning Strategy formulation Mapping strategic intent and defining mission Strategy implementation Human resource congruency

Setting and prioritizing objectives Developing plan of action and implementation Responding in a flexible manner Creating value Working through the organizational structure Allocating human resources Managing time efficiently
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Skills for Managerial Success (continued)

People Skills

Self-Awareness Skills

Delegating Influencing Motivating Handling conflict Win-win negotiating Networking Communicating Verbal Nonverbal Listening Cross-cultural management Heterogeneous teamwork

Personal adaptability Understanding personal biases Internal locus of control

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The Evolution of Management Thought

Early Management Thought Classical Perspective

Contemporary Management Perspectives

Behavioral Perspective

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Early Management Thought

Early ideas about management strategy

Sun

Tzu, The Art of War

Early ideas about leadership

Nicol

Machiavelli, The Prince

Early ideas about the design and organization of work

Adam

Smith, The Wealth of Nations

of labor
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division

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Classical Perspective

Scientific Management
Frederick

W. Taylor

Bureaucratic Management
Max

Weber
Fayol

Administrative Management
Henri

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Taylors Four Principles of Scientific Management

Scientifically study each part of a task and develop the best method of performing the task. 2. Carefully select workers and train them to perform the task by using the scientifically developed method. 3. Cooperate fully with workers to ensure that they use the proper method. 4. Divide work and responsibility so that management is responsible for planning work methods using scientific principles and workers are responsible for executing the work accordingly.
1.
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Key Characteristics of Webers Ideal Bureaucracy

Specialization of labor Formal rules and procedures Impersonality Well-defined hierarchy Career advancement based on merit

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Fayols 14 Principles of Management

1. Division of work 2. Authority 3. Discipline 4. Unity of command 5. Unity of direction 6. Subordination of 8. 9.

Centralization Scalar chain

10. Order 11. Equity 12. Stability and tenure 13. Initiative

individual interest to the general interest

7. Remuneration

14. Esprit de corps

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Behavioral Perspective

The Hawthorne Studies Human Relations Approach

Employee

motivation
Maslow

Abraham

Leadership
Douglas

style

McGregor

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Hawthorne Effect:

The discovery that paying special attention to employees motivates them to put greater effort into their jobs.
(from the Hawthorne management studies, performed from 1924 1932 at Western Electric Companys plant near Chicago)

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Maslows Hierarchy of Needs

Self-Actualization

Need for Self Esteem

Need for Social Relations Need for Security Physical Needs

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McGregors Theory X and Theory Y

Leaders and managers who hold Theory X assumptions believe that employees are inherently lazy and lack ambition.

A negative perspective on human behavior.

Leaders and managers who hold Theory Y assumptions believe that most employees do not dislike work and want to make useful contributions to the organization.

A positive perspective on human behavior.

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Contemporary Management Perspectives

Systems Theory
Contingency Theory

Total Quality Management

The Learning Organization

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Systems Theory

Views the organization as a system of interrelated parts that function in a holistic way to achieve a common purpose. Systems theory concepts that affect management thinking:
Open

and closed systems Subsystems Synergy Equifinality

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Contingency Theory

States that there is no one best way to manage an organization.

Because

what works for one organization may not work for another Situational characteristics (contingencies) differ Managers need to understand the key contingencies that determine the most effective management practices in a given situation
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Total Quality Management (TQM)

An organization-wide approach that focuses on quality as an overarching goal. The basis of this approach is the understanding that all employees and organizational units should be working harmoniously to satisfy the customer.

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The Learning Organization

The management approach based on an organization anticipating change faster than its counterparts to have an advantage in the market over its competitors. There are two ways organizations can learn:
Experimental

learning External learning

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