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*Chapter

Seven

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Management and Leadership

McGraw-Hill/Irwin

Copyright 2010 by The McGraw-Hill Companies, Inc. All rights reserved.

TODAYS MANAGEMENT
Management is the process used to accomplish organizational goals through planning, organizing, leading and controlling people and other organizational resources.

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Managers Roles Are Evolving

LG1

7-2

FOUR FUNCTIONS of MANAGEMENT

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Four Functions of Management

LG2

1. Planning 2. Organizing 3. Leading 4. Controlling

Study figure 7.1


7-3

SHARING the VISION


Vision -- More than a goal, its a broad explanation of why the organization exists and where its trying to go. Gives a sense of purpose (future)

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Planning & Decision Making

LG3

A mission statement outlines the organizations fundamental purposes. (present) Organizations self-concept Its philosophy Customer needs Social responsibility Nature of product or service
7-5

Goals are the broad, long term accomplishments an organization wishes to attain.

Objectives are specific, short term statements detailing how to achieve the organizations goals.

PLANNING ANSWERS FUNDAMENTAL QUESTIONS

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Planning & Decision Making

LG3

What is the situation now? SWOT Analysis -- Analyzes the organizations


Strengths, Weaknesses, Opportunities and Threats.

Fig: 7.3

How can we get to our goal from here?


Strategic planning Tactical planning Operational planning Contingency planning
7-7

STRATEGIC and TACTICAL PLANNING

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Planning & Decision Making

LG3

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.

7-8

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OPERATIONAL and CONTINGENCY PLANNING
Planning & Decision Making

LG3

Operational Planning -- The process of setting


work standards and schedules necessary to implement the companys tactical objectives.

Contingency Planning -The process of preparing alternative courses of action the firm can use if its primary plans dont work out.

7-9

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PLANNING FUNCTIONS
Planning & Decision Making

LG3

7-10

RATIONAL DECISION-MAKING MODEL (7Ds)


1. Define the situation.

Decision Making: Finding the Best Alternative

LG3

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.(begin implementation) 7. Determine whether the decision was a good one and follow up.
7-11

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Problem Solving

Decision Making: Finding the Best Alternative

LG3

Problem Solving: less formal than decision making, calls for quicker action to resolve everyday issues with less info. available 1. Brainstorming - coming up with as many solutions possible in a short period of time with no censoring of ideas. 2. Another technique is called PMI, or listing all the pluses for a solution in one column, all the minuses in another, and the implications in a third. The idea is to make sure the pluses exceed the minuses.

7-12

ORGANIZATIONAL CHARTS

*Organizing:
Creating a Unified System LG4

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

7-13

Classifying Managers*
1. First-line Managers also called supervisors Are at the lowest level of management and manage the work of non-managerial employees e.g. Shift managers, district managers, etc.

2. Middle Managers Manage the work of first-line managers e.g. Regional manager, project leader, store manager, etc.
3. Top Managers Are responsible for making organization-wide decisions and establishing plans and goals that affect the entire organization e.g. Managing director, CEO, COO, President, etc.
Copyright 2005 Prentice Hall, Inc. All rights reserved. 114

LEVELS of MANAGEMENT

*Organizing:
Creating a Unified System LG4

7-15

Organizing
Skills/Tasks
Technical- task in specific discipline Human relation- involve communication and motivation Conceptual- the ability to picture the org. as a whole

Staffing
Involves recruiting, hiring, motivating and retaining the best people available to accomplish the companys objectives.

7-16

Skills Needed at Different Management Levels

Copyright 2005 Prentice Hall, Inc. All rights reserved.

117

LEADERSHIP- Leading
Leaders must:

Leading: Providing Continuous Vision and Values.

LG5

- Communicate a vision and rally others around that vision- a successful leader must influence the action of others. - Establish corporate values. - Promote corporate ethics. - Embrace change- both effective and efficient - Stress accountability and responsibility- transparency

7-18

LEADERSHIP STYLES
Autocratic Leadership -- Making
managerial decisions without consulting others.

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Leadership Styles
LG5

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. Works best when supervises doctors, engineers, professors and professionals etc.
7-19

Directing- giving explicit instructions about what to do (fast food restaurant and small retail business) Empowerment- giving employees the authority to make a decision without consulting the manager. (high-tech firm, internet companies) Enabling- giving workers education and tools they need to make decisions Knowledge management- knowledge is power: finding the right info, keeping it
accessible and known to everyone in the firm

LEADERSHIP STYLES- other concepts

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FIVE STEPS of CONTROLLING

Controlling: Making Sure it Works

LG6

7-21

A key criterion for measurement: Customer Satisfaction


External customers include dealers, who buy products to sell to others, and ultimate customers such as you and me, who buy their products for their own personal use. Internal customers are individuals and units within the firm that receive services from other individuals or units. (field sales people) One goal today is to go beyond simply satisfying customers to delighting them with unexpectedly good products and services.