chapter seven understanding the management process

Chapter Seven

Understanding the Management

Process

What Is Management?

The process of coordinating people and other resources to achieve the goals of an

organization

Resources– Material resources

• physical inputs to production an organization uses

– Human resources• people who staff the organization and use the other

resources to achieve the goals of the organization

– Financial resources• funds the organization uses to meet its obligations to

investors and creditors

– Information resources• data about internal and external business environmental

conditions that the firm uses to create a competitive advantage

Strategic Planning

The process of establishing an organization’s major goals and allocating the resources to achieve them

Planning

• Establishing goals and objectives– Goal

• An end result that the organization is expected to achieve over a one-to-ten year period (get a degree in Business Administration)

– Objective• A specific statement detailing what the

organization intends to accomplish over a shorter period of time (take Bus 1100 and get an A)

“Plan B”

– Contingency plan• A plan of alternative courses of action if

the organization’s other plans are disrupted or become ineffective

(If I don’t do well in Bus 1100, I’ll get a degree in Psychology)

Who’s Doing the Planning?

Levels of Management

-Top manager—guides and controls the overall fortunes of the organization-plan the future

-Middle manager—implements the strategy and major policies developed by top management

-First-line manager—coordinates and supervises the activities of operating employees-run today

CEO, COO

Dept head, plant mgr

Supervisor, foreman

What Makes Effective Managers?

Key Management Skills

– Technical skill• A special skill needed to accomplish a

specialized activity-1st line and mid mgrs

– Conceptual skill• The ability to think in abstract terms-top mgrs

– Interpersonal skill• The ability to deal effectively with other people

-Needed by all mgrs

Leadership

The ability to influence others

Formal – uses legitimate power of position &

corporate authority to influence others

Informal – uses charisma & special

knowledge to gain voluntary

allegiance

Styles of Leadership

1) Authoritarian (UPS) -Manager holds all authority & responsibility -Top to bottom communication

2) Laissez-faire (Apple) -Manager delegates authority to employees -Allows subordinates to work with a minimal interference -Horizontal communication among work groups

3) Democratic (Saturn) -Manager holds final responsibility but delegates authority to others -Communication is active upward and downward

So, which leadership style is best?

Which Leadership Style Is Best?none and all

• Match style to the situation

• Effective leadership depends on– Interaction among the employees– Characteristics of the work situation– The manager’s personality

The Managerial Decision-Making Process

1) Identifying the problem or opportunity

– Problem• The discrepancy between an actual condition

and a desired condition-have low sales, want higher sales

Opportunity• A “positive” problem-have good sales, see a

way to make more sales

Managerial Decision-Making

2) Generating alternatives

– BrainstormingEncouraging participants to come up with new ideas to solve a problem

– “Blast! Then Refine” Erase past solutions from choices

and devise a new solution from scratch

-- Trial and error

Just do it an watch what happens

Managerial Decision-Making Process

3) Selecting an alternative– Satisficing

• Choosing an alternative that is not the best possible solution, but one that adequately solves the problem-needed when time/money or both are scarce

Managerial Decision-Making Process

4) Implementing your choice

- Requires time, planning, preparationof personnel, and contingencies

5) Evaluating the solution

– An effective decision removes the difference between the actual condition and the desired condition

– If its not working• give it more time• change it • scrap it