067 management

SENIOR
OUTCOMES SEMINAR
(BU385)
Management

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

Basic Purpose of
Management
EFFICIENTLY
Using resources wisely and
in a cost-effective way
EFFECTIVELY
Making the right decisions and
successfully implementing them

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

The Management Process
 Planning and Decision Making
 Setting an organization’s goals and selecting a course of
action from a set of alternatives to achieve them.
 Organizing
 Determining how activities and resources are grouped.
 Leading
 The set of processes used to get organizational
members to work together to advance the interests of
the organization.
 Controlling
 Monitoring organizational progress towards goals.

Fundamental Management Skills
 Management Skill Mixes at Different
Organizational Levels

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

Classical Management Perspective
 Scientific Management
 Concerned with improving the
performance of individual workers (i.e.,
efficiency).
 Grew out of the industrial revolution’s
labor shortage at the beginning of the
twentieth century.
 Administrative Management
 A theory that focuses on
managing the total organization.

Scientific Management
 Frederick Taylor (1856–1915)
 Replaced old methods of how to do work with
scientifically-based work methods to eliminate
“soldiering,” where employees deliberately
worked at a pace slower than their capabilities.
 Believed in selecting, training, teaching, and
developing workers.
 Used time studies of jobs, standards planning,
exception rule of management, slide-rules,
instruction cards, and piece-work pay systems
to control and motivate employees.

Classical Management Perspective
 Administrative Management Theory
 Focuses on managing the whole organization rather
than individuals.
 Henri Fayol (1845–1925)
 Was first to identify the specific management
functions of planning, organizing, leading, and
controlling.
 Max Weber (1864–1920)
 His theory of bureaucracy is based on a rational set
of guidelines for structuring organizations.

Behavioral Management Perspective
 Behavioral Management
 Emphasized individual attitudes and
behaviors, and group processes, and
recognized the importance of
behavioral processes in the workplace.
 Hawthorne Studies (1927–1932)
 Mayo: founder of human relations

The Hawthorne Studies
(1927–1932)
 Conducted by Elton Mayo and associates at
Western Electric
 Illumination study —workplace lighting
adjustments affected both the control and the
experimental groups of production employees.
 Group study—implementation of piecework
incentive plan caused production workers to
establish informal levels of acceptable individual
output.
• Over-producing workers were labeled “rate
busters” and under-producing workers were
considered “chiselers.”

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

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

Organizational Behavior
 A contemporary field focusing on behavioral
perspectives on management.
 Draws on psychology, sociology, anthropology,
economics, and medicine.
 Important topics in organizational behavior
research:
 Job satisfaction and job stress
 Motivation and leadership
 Group dynamics and organizational politics
 Interpersonal conflict
 The structure and design of organizations

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

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

The Systems Perspective of
Organizations
Inputs from the
environment:
material inputs,
human inputs,
financial inputs, and
information inputs
Transformation
process: technology,
operating systems,
administrative
systems, and
control systems
Outputs into
the environment:
products/services,
profits/losses,
employee behaviors,
and information
outputs
Feedback

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

Decision Making and the
Planning Process
 The Planning Process
Strategic goals Strategic plans
Tactical goals
Operational goals Operational plans
The organization’s mission
The Environmental Context
• Purpose • Premises • Values • Directions
Tactical plans

Kinds of Goals
 By Level
 Mission statement is a statement of an
organization’s fundamental purpose.
 Strategic goals are goals set by and for top
management of the organization that address
broad, general issues.
 Tactical goals are set by and for middle
managers; their focus is on how to
operationalize actions to strategic goals.
 Operational goals are set by and for lower-
level managers to address issues associated
with tactical goals.

SWOT
Analysis
 Strengths
 Weakness
es
 Opportuni
ties
 Threats
Mission
An organization’s fundamental purpose
Best Strategies
SWOT Analysis
To formulate strategies that support the mission
Those that support the mission and
• exploit opportunities and strengths
• neutralize threats
• avoid (or correct) weaknesses
Internal Analysis
Strengths
(distinctive
competencies)
Weaknesses Threats
External Analysis
Opportunities

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

Organizational Structure
 The Nature of Organizing
 Job Specialization
 Grouping Jobs: Departmentalization
 The Bureaucratic Model of Organization
Design
 Situational Influences on Organization
 Core Technology
 Environment
 Organization Size and Life Cycle

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

Establishing Reporting Relationships
 Chain of Command
 A clear and distinct line of authority among the
positions in an organization.
 Unity of Command
• Each person within an organization must have
a clear reporting relationship to one and
only one boss.
 Scalar Principle
• A clear and unbroken line of authority
must extend from the bottom to the
top of the organization.

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

 Job Satisfaction and Work Behaviors
 High levels of job satisfaction do not
necessarily lead to high job
performance.

 Organizational Commitment
 An attitude that reflects an individual’s
identification with and attachment to an
organization.
 Organizational Commitment and Work
Behaviors
 Employee commitment strengthens with an
individual’s age, years with the organization, sense
of job security, and participation in decision
making.
 Committed employees have highly reliable habits,
plan a longer tenure with the organization.

Motivation
 The Nature of Motivation
 Content Perspectives on Motivation
 The Need Hierarchy Approach
 The Two-Factor Theory
 Individual Human Needs (nAch, nAff)
 Process Perspectives on Motivation
 Expectancy Theory
 Equity Theory
 Goal-Setting Theory

Process Perspectives on Motivation
 Porter-Lawler Extension of
Expectancy Theory
Intrinsic
rewards
(outcomes)
Performance
Perceived
equity
Satisfaction
Extrinsic
rewards
(outcomes)
Figure 10.5
Source: Edward E. Lawler III and Lyman W. Porter, “The Effect of Performance on Job Satisfaction,”
Industrial Relations, October 1967, p. 23. Used with permission of the University of California.

Popular Motivational Strategies
 Empowerment and Participation
 Empowerment
• The process of enabling workers to set their own
work goals, make decisions, and solve problems
within their sphere of influence.
 Participation
• The process of giving employees a voice in making
decisions about their work.
 Areas of Participation for Employees
• Making decisions about their jobs.
• Participating in decision making about broader
issues of product quality.

Using Reward Systems to
Motivate Performance
 Designing Effective Reward Systems
 Reward system must meet an
individual’s needs.
 Rewards should compare favorably with
other organizations.
 Distribution of rewards must be
perceived to be equitable.
 Reward system must recognize
different needs.

 Popular Approaches to Rewarding
Employees
 Traditional systems
• Fixed hourly or monthly rate.
 Merit systems
• Employees get different pay raises at the end
of the year based on overall job performance.
 Incentive systems
• Employees get different pay amounts at each
pay period in proportion to what they do
(e.g., piece-rate pay plans).

 Popular Approaches (cont’d)
 Profit sharing plans
• Provides bonus based to corporate profits.
 Gainsharing
• All group members get bonuses when
performance targets are exceeded.
 Lump sum bonuses
• One-time reward, not an increase in base.
 Pay-for-knowledge
• Pay the individual rather than the job.

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

Leadership
 Situational Approaches to Leadership
(cont’d)
 Path-Goal Theory
 The Leader-Member Exchange Approach
 Related Perspectives on Leadership
 Substitutes for Leadership
 Charismatic Leadership
 Transformational Leadership

The Nature of Leadership
Power and Leadership
Power: ability to affect the behavior of others.
•Legitimate power is granted through the
organizational hierarchy.
•Reward power is the power to give or withhold
rewards.
•Coercive power is the capability to force compliance
by means of psychological, emotional, or physical
threat.
•Referent power is the personal power that accrues to
someone based on identification, imitation, loyalty, or
charisma.
•Expert power is derived from the possession of
information or expertise.

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

Groups and Teams in Organizations
 Functional Group
 A permanent group created to accomplish a
number of organizational purposes within an
indefinite time horizon.
 Informal or Interest Group
 A group created by its own members for purposes
that may or may not be relevant to organizational
goals.
 Task Group
 A group created by the organization to
accomplish a relatively narrow range of purposes
within a stated time horizon.

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

Characteristics of Teams
 Role
 The part an individual plays in helping
the group reach its goals.
• Task-specialist—role concentrating on
getting the group’s tasks accomplished.
• Socioemotional role—providing social
and emotional support to others on
the team.

Characteristics of Teams
 Cohesiveness
 The extent to which members are loyal and
committed to the group; the degree of mutual
attractiveness within the group.
 Factors That Influence Group Cohesiveness
Factors That Increase
Cohesiveness
Factors That Reduce
Cohesiveness
Intergroup competition
Personal attraction
Favorable evaluation
Agreement on goals
Interaction
Group size
Disagreement on goals
Intragroup competition
Domination
Unpleasant experiences

Interpersonal and Intergroup Conflict
 The Nature of Organizational Conflict
Conflict
High
Low
Low High
Optimal level of conflict
Performance

067 management

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