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* * Chapter Seven Management and Leadership Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

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Page 1: Bus100 9ed Chapter 07 Ppt

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*Chapter Seven

Management and

Leadership

Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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*Profile

• Started at Pepsi after earning masters degrees from the Indian School of Management and Yale.

INDRA KRISHNAMURTHY NOOYIPepsi

• Goal was to increase sales overseas, introduce good-for-you products and place more emphasis on food.

• She is a top manager using a boss-centered leadership style while still being a team player.

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Source: Fortune Magazine, www.fortune.com, October 13, 2008.

AMERICA’S MOST POWERFUL FEMALE MANAGERS

Name Organization Age

Indra Nooyi PepsiCo 52

Irene Rosenfeld Kraft Foods 55

Pat Woertz Archer Daniel Midland 55

Anne Mulcahy Xerox 55

Angela Braly Wellpoint 47

Andrea Jung Avon 50

Susan Arnold Proctor & Gamble 54

Oprah Winfrey Harpo 54

Brenda Barnes Sara Lee 54

Ursula Burns Xerox 50

Profile

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*Four Functionsof Management

• Management -- The process used to accomplish organizational goals through planning, organizing, leading and controlling people and other organizational resources.

WHAT IS MANAGEMENT?LG2

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*Managers’ Roles Are Evolving

• Younger and more progressive.- Growing numbers of women.

- Fewer from elite universities.

• Emphasis is on teams and team building.

• Managers need to be skilled communicators and team players.

TODAY’S MANAGERS

LG1

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Source: Entrepreneur, www.entrepreneur.com, March 2009.

RESPECT and HOW to GET IT Managers’ Roles Are Evolving

LG1

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Source: BusinessWeek, www.businessweek.com, January 19, 2009.

The BEST MANAGERS

Name Age Organization

David Axelrod 53 Obama Campaign

Frank Blake 59 Home Depot

Jamie Dimon 52 JPMorgan

Larry Ellison 64 Oracle

Takeo Fukui 64 Honda

Mark Hurd 53 Hewlett-Packard

Satoru Iwata 49 Nintendo

Peter Loscher 51 Siemens

Irene Rosenfeld 55 Kraft Foods

Managers’ Roles Are Evolving

LG1

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Source: BusinessWeek, www.businessweek.com, January 19, 2009.

The WORST MANAGERS

Name Organization What Went Wrong

James Cayne Bear Stearns Played golf and bridge while the company collapsed.

Richard Fuld Lehman Brothers Ignored warning signs and rewarded greed.

Kerry Killinger Washington Mutual Bad lending standards led to bankruptcy.

Philip Schoonover Circuit City Fired 3,400 experienced employees for cheaper replacements.

Managers’ Roles Are Evolving

LG1

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*Four Functionsof Management

1. Planning

2. Organizing

3. Leading

4. Controlling

FOUR FUNCTIONS of MANAGEMENT

LG2

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• The lack of professional managers is keeping U.S. companies from expanding rapidly in global markets.

• Flexibility is the key to successfully expanding abroad.

• Developing products to appeal to another market is another way to be successful.

WE NEED MANAGERS HERE(Reaching Beyond Our Borders)

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*Planning & Decision Making

• Vision -- More than a goal, it’s a broad explanation of why the organization exists and where it’s trying to go.

SHARING the VISION

LG3

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*Planning & Decision Making

• Mission Statement -- Outlines the organization’s fundamental purposes. It includes:

- The organization’s self–concept.- Its philosophy.- Long–term survival needs.- Customer needs.- Social responsibility.- Nature of the product or service.

DEFINING THE MISSION

LG3

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*Planning & Decision Making

• Goals -- The broad, long-term accomplishments an organization wishes to attain.

• Objectives -- Specific, short-term statements detailing how to achieve the organization’s goals.

SETTING GOALS and OBJECTIVES

LG3

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*Planning & Decision Making

• What is the situation now?

SWOT Analysis -- Analyzes the organization’s Strengths, Weaknesses, Opportunities and Threats.

• How can we get to our goal from here?- Strategic planning- Tactical planning- Operational planning- Contingency planning

PLANNING ANSWERS FUNDAMENTAL QUESTIONS

LG3

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*Planning & Decision Making

LG3

SWOT MATRIX

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*Planning & Decision Making

• Strategic Planning -- Done by top management and determines the major goals of the organization and the policies, procedures, strategies and resources it will need to achieve them.

• Tactical Planning -- The process of developing detailed, short-term statements about what is to be done, who is to do it and how.

STRATEGIC and TACTICAL PLANNING

LG3

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*Planning & Decision Making

• Operational Planning -- The process of setting work standards and schedules necessary to implement the company’s tactical objectives.

OPERATIONAL and CONTINGENCY PLANNING

LG3

• Contingency Planning -- The process of preparing alternative courses of action the firm can use if its primary plans don’t work out.

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*Planning & Decision Making

LG3

PLANNING FUNCTIONS

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• The original “Blue Men” manage over 500 employees; 70 are performers in 12 cities.

• Creators wrote a 132-page Blue Man manual helping them understand the importance of managing growth.

I’D RATHER be BLUE(Spotlight on Small Business)

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*Decision Making: Finding the Best Alternative

• Decision Making -- Choosing among two or more alternatives.

DECISION MAKING

LG3

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*Decision Making: Finding the Best Alternative

1. Define the situation.

2. Describe and collect needed information.

3. Develop alternatives.

4. Develop agreement among those involved.

5. Decide which alternative is best.

6. Do what is indicated.

7. Determine whether the decision was a good one and follow up.

RATIONAL DECISION-MAKING MODEL

LG3

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*Decision Making: Finding the Best Alternative

• Problem Solving -- The process of solving the everyday problems that occur; less formal than decision making and needs quicker action.

• Problem-solving techniques include brainstorming and PMI -- Listing all the pluses for a solution in one column, all the minuses in another and the implications in a third.

PROBLEM SOLVING

LG3

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*Progress Assessment

• What’s the difference between goals and objectives?

• What does a company analyze when it does a SWOT analysis?

• What are the differences between strategic, tactical and operational planning?

• What are the seven Ds in decision making?

PROGRESS ASSESSMENT

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*Organizing: Creating a Unified System

• Organization Chart -- A visual device that shows relationships among people and divides the organization’s work; it shows who reports to whom.

ORGANIZATIONAL CHARTS

LG4

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*Organizing: Creating a Unified System

LG4

LEVELS of MANAGEMENT

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*Organizing: Creating a Unified System

• Top Management -- The highest level, consists of the president and other key company executives who develop strategic plans.

• Middle Management -- Includes general managers, division managers, and branch and plant managers who are responsible for tactical planning and controlling.

• Supervisory Management -- Those directly responsible for supervising workers and evaluating daily performance.

MANAGEMENT LEVELS

LG4

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*Organizing: Creating a Unified System

• Chief Executive Officer (CEO)- Introduces change into an organization.

• Chief Operating Officer (COO)- Implements CEO’s changes.

• Chief Financial Officer (CFO)- Obtains funds, plans budgets, collects funds, etc.

• Chief Information Officer (CIO)- Gets the right information to the right people so

decisions can be made.

TOP MANAGEMENT

LG4

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• Technical Skills -- The ability to perform tasks in a specific discipline or department.

MANAGERIAL SKILLS Tasks and Skills at Different Levels of Management

LG4

• Human Relations Skills -- Skills that involve communication and motivation; they enable managers to work through and with people.

• Conceptual Skills -- Skills that involve the ability to picture the organization as a whole and the relationship among its various parts.

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*Tasks and Skills at Different Levels of Management

LG4

SKILLS NEEDED at VARIOUS LEVELS of MANAGEMENT

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*Staffing: Getting and Keeping the Right People

• Staffing -- Recruiting, hiring, motivating and retaining the best people available to accomplish the company’s objectives.

• Recruiting good employees is critical.

• Many people are not willing to work at companies unless they are treated well with fair pay.

STAFFING

LG4

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Source: Businessweek, www.businessweek.com, December 1, 2008.

LAYOFF LEADERSLargest Layoff Announcements, 1993 to 2008

Company Employees Date

IBM 60,000 July 1993

Citigroup 53,000 November 2008

Sears Roebuck 50,000 January 1993

U.S. Air Force 40,000 December 2005

Ford 35,000 January 2002

Kmart 35,000 January 2003

Boeing 31,000 September 2001

U.S. Postal Service 29,870 January 2002

Boeing 28,000 December 1998

DaimlerChrysler 26,000 January 2001

Staffing: Getting and Keeping the Right People

LG4

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*Leading: Providing Continuous Vision and Values.

• Leaders must:

- Communicate a vision and rally others around that vision.

- Establish corporate values.

- Promote corporate ethics.

- Embrace change.

- Stress accountability and responsibility

LEADERSHIP

LG5

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*Leading: Providing Continuous Vision and Values.

• Transparency -- The presentation of the company’s facts and figures in a way that is clear and apparent to all stakeholders.

ACCOUNTABILITY through TRANSPARENCY

LG5

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As a first-line manager, you have new information that your department head hasn’t seen yet. The findings of the report indicate your manager’s plans should fail. If they do fail, you could be promoted.

Will you give your department head the report?

What is the ethical thing to do?

What might be the consequences?

To SHARE or NOT to SHARE(Making Ethical Decisions)

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*Leadership Styles

• Autocratic Leadership -- Making managerial decisions without consulting others.

• Participative or Democratic Leadership -- Managers and employees work together to make decisions.

• Free-Rein Leadership -- Managers set objectives and employees are free to do whatever is appropriate to accomplish those objectives.

LEADERSHIP STYLES

LG5

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*Leadership Styles

LG5

VARIOUS LEADERSHIP STYLES

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Source: CIO Magazine, www.cio.com.

NATURAL BORN LEADERS?Four Types of Executives

Rationalists Humanists

Politicists Culturists

Leadership Styles

LG5

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*Empowering Workers

• Progressive leaders give employees the authority to make decisions on their own without consulting a manager.

• Customer needs are handled quickly.

• Manager’s role becomes less of a boss and more of a coach.

• Enabling -- Giving workers the education and tools they need to make decisions.

EMPOWERMENT

LG5

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Source: BusinessWeek, www.businessweek.com.

• Manage output instead of hours.

• Train workers to be ready for a more complex corporate structure.

• Allow lower-level managers to make decisions.

• Use new technology to foster teamwork.

• Shift hiring emphasis to collaboration.

WORK SMARTERHow to Ease Pressure on Workers

Empowering Workers

LG5

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*Managing Knowledge

• Knowledge Management -- Finding the right information, keeping the information in a readily accessible place and making the information known to every one in the firm.

MANAGING KNOWLEDGE

LG5

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*Controlling: Making Sure it Works

FIVE STEPS of CONTROLLING

LG6

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Source: CFO Magazine, www.cfo.com.

• Do you have strategic initiatives that you have not addressed?

• Do you often check on employees for quality control?

• Do you often check on subordinates throughout the day?

• Do you rarely take vacations?

• Is there a lot of turnover?

ARE YOU a MICROMANAGER?Controlling: Making Sure it Works

LG6

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*A Key Criterion for Measurement: Customer Satisfaction

• Traditional forms of measuring success are financial.

• Pleasing employees, stakeholders and customers (both internal and external) are important.

• External Customers -- Dealers, who buy products to sell to others, and ultimate customers (or end users), who buy products for their own use.

• Internal Customers -- Individuals and units within the firm that receive services from other individuals or units.

MEASURING SUCCESS

LG6

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*Progress Assessment

• How does enabling help achieve empowerment?

• What are the five steps in the control process?

• What’s the difference between internal and external customers?

PROGRESS ASSESSMENT

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