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Management

CHAPTER ONE

Management 3rd Edition Chuck Williams


Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

1 CHAPTER ONE

What Would You Do?


You are the new CEO of Home Depot Market share is shrinking for the first time
Inefficiencies exist everywhere

Company culture has changedfor the worse How can you turn things around?

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

2 CHAPTER ONE

What Would You Do?


Issues facing Home Depot are fundamental to any organization:
How do we get things done
Meet the competition Organize the company to be efficient and effective Successfully lead those who work for us

Good management is:


Starting business Growing business

Maintaining business once it has achieved some measure of success.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

3 CHAPTER ONE

Learning Objectives
After reading this chapter, you should be able to:
Describe what management is.

Explain the four functions of management.


Describe different kinds of managers. Explain the major roles and sub-roles that managers perform in their jobs. Explain what companies look for in managers Discuss the top mistakes that managers make in their jobs. Describe the transition that employees go through when are promoted to management. Explain how and why companies can create competitive advantage through people.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

4 CHAPTER ONE

Management is.
Good management is working through others to accomplish tasks that help fulfill organizational objectives as efficiently and effectively as possible. Management: getting work done through others Efficiency: getting work done with a minimum of effort, expense, or waste. Effectiveness: accomplishing tasks that help fulfill organizational objectives.

Efficiency versus effectiveness:


efficiency is doing things right and effectiveness is doing the right things.

Both are necessary for good management.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

5 CHAPTER ONE

Management is

Getting work done through others

Efficiency

Effectiveness

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Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

6 CHAPTER ONE

Management Functions
Classical Management Functions Updated Management Functions

Planning Controlling Organizing Leading

Making Things Happen Meeting the Competition Organizing People, Projects, and Processes

Leading

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7 CHAPTER ONE

Classical Management Functions


Traditionally, a managers job has been classified according to the following these four functions.
Planning: determining organizational goals and means for achieving them. Controlling: monitoring progress towards goal achievement and taking corrective action when needed. Organizing: deciding where decisions will be made, who will do what jobs and tasks, and who will work for whom. Leading: inspiring and motivating workers to work hard to achieve organizational goals.

Good managers are those who perform these functions well.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

8 CHAPTER ONE

New Style Managers


New style managers are changing the way they perform classical management functions:
Thinking of themselves more like sponsors, team leaders, or internal consultants.

They work with anyone who can help them accomplish their goals rather than only following the chain of command. They ask others to participate in making decisions and share information with others.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

9 CHAPTER ONE

New Style Managers


New style managers perform four functions that have evolved out of the traditional functions:
Making things happen Meeting the competition Organizing people Project and process Leading

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10 CHAPTER ONE

Making Things Happen


To make things happen you must:

Determine what you want to accomplish Plan how to achieve those goals Gather and manage the information needed to make good decisions Control performance
So that you can take corrective action if performance falls short.

2.1
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11 CHAPTER ONE

Meeting the Competition


Free trade agreement, shorter product development cycles, and fewer barriers to entering industries have created increased competition. Companies that want to remain market leaders must: Consider the threat from international competitors Have a well-thought-out competitive strategy Embrace change and foster new product and service ideas

Structure their organizations to adapt to changing customers and competitors.

2.2
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12 CHAPTER ONE

Organizing People, Projects, and Processes


Changes in how a company is organized must consider both people issues and work processes (how the work gets done)

Consideration of people issues (emphasis on leading) Consideration of work processes (emphasis on process)

For example:
Top management may restructure an organization and create different strategic business units

2.3
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13 CHAPTER ONE

Leading
Leading is:
Motivation Inspiration Communication Perspiration (sweat)

For example:
HR managers may put together an innovative compensation plan that motivates employees to work ever harder.

2.4
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14 CHAPTER ONE

What Do Managers Do? Kinds of Managers


Top Managers

Middle Managers
First-Line Managers Team Leaders

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More
15 CHAPTER ONE

Jobs and Responsibilities


CEO COO CIO General Mgr Plant Mgr Regional Mgr Office Manager Shift Supervisor Department Manager Team Leader
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16 CHAPTER ONE

Top Managers (executive responsible for the overall direction)

Top Managers are Responsible for Creating a context for change Developing attitudes of commitment and ownership in employees Creating a positive organizational culture through language and action Monitoring their business environments
3.1
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17 CHAPTER ONE

Middle Managers (plant manager, regional manager)


Middle Managers Responsible for Setting objectives consistent with top management goals, planning strategies

Coordinating and linking groups, departments, and divisions


Monitoring and managing the performance of subunits and managers who report to them Implementing the changes or strategies generated by top managers
18 CHAPTER ONE

3.2

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First-Line Managers (office/department/shift managers) Managers who train non-managerial employees and supervise their performance
and who are directly responsible for producing the companys product or services.

Responsible for Managing the performance of entry-level employees Teaching entry-level employees how to do their jobs

Making schedules and operating plans based on middle managements intermediate-range plans
3.3
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19 CHAPTER ONE

Team Leaders (new product launch, cost saving program, new technology
development) Managers responsible for facilitating team activities toward goal accomplishment.

Responsible for
Facilitating team performance
(but the team as a Whole responsible for performance itself)

Managing external relationships ( e.g., those with other Teams) Facilitating internal team relationships
(e.g., resolving conflicts)

3.4
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20 CHAPTER ONE

Managerial Roles
Managers fulfill three major roles while performing their jobs:

Interpersonal roles
Informational roles Decisional roles
Managers talk to people, gather and give information, and make decisions. Three major roles can be sub-divided into 10 subroles (see next slide).

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

21 CHAPTER ONE

Managerial Roles
Interpersonal Figurehead Leader Liaison Informational Monitor Disseminator Spokesperson Resource Allocator Negotiator Decisional Entrepreneur Disturbance Handler

Adapted from Exhibit 1.3


H. Mintzberg, The Nature of Managerial Work (New York: Harper & Row, 1973)

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

22 CHAPTER ONE

Managerial Roles
Interpersonal Roles
Management jobs are people intensive, with at least two thirds of time spent communicating with others. Managers perform three interpersonal sub-roles: Figurehead role: the interpersonal role managers play when they perform ceremonial duties like greeting company visitors, making opening remarks when new facility open.

Leader role: the interpersonal role managers play when they motivate and encourage workers to accomplish organizational objectives
Liaison role: the interpersonal role managers play when they deal with people outside their units.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

23 CHAPTER ONE

Managerial Roles
Informational Roles
Managers spend most of their time gathering and sharing information through the following sub-roles: Monitor role: the informational role manager play when they scan their environment for information, actively contact others for information, and, because of their personal contacts, receive unsolicited information.

Disseminator role: the informational role managers play when they share information with other in their department.
Spokesman role: the informational role managers play when they share information with people outside their departments or companies.

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24 CHAPTER ONE

Managerial Roles
Decisional Roles
One purpose of communicating with people to gather and share information is to make decisions. There are four decisional sub-roles: Entrepreneur role: the decisional role managers play when they adapt themselves, their subordinates, and their units to incremental change. Disturbance handler role: the decisional role managers play when they respond to severe problems that demand immediate action. Resource allocate role: the decisional role managers play when they decide who will get what resources and how many resources they get. Negotiator role: the decisional role managers play when they negotiate schedules, projects, goals, outcomes, resources, and employee raises.
25 CHAPTER ONE

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What Companies Look for in Managers


Companies do not want one-dimensional managers. They want managers with a balance of skills.

Technical Skills

Human Skill

Conceptual Skill

Motivation to Manage

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26 CHAPTER ONE

What Companies Look for in Managers


Companies look for three major skills in their managers: technical, human, and conceptual.
Technical skills: the ability to apply the specialized procedures, techniques, and knowledge required to get the job done.

For example: Knowing how to design an integrated circuit in a high-tech firm or Knowing how to use a variety of computer software applications in an office.
Human Skills: the ability to work well with others. Human skills are equally important for all level of management. Upper level management spends most time dealing directly with people. For example: A department manager uses human skills to gain support from top management for her department.

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

27 CHAPTER ONE

What Companies Look for in Managers


Conceptual Skills: the ability to see the organization as a whole, how the different parts affect each other, and how the company fits into or is affected by its environment:

Such as the local community, social and economic forces, customers, and the competition.
Conceptual skills increase in importance as managers rise through the management hierarchy. Motivation to Manage: an assessment of how enthusiastic employees are about managing the work of others. Managers at high levels typically have stronger motivation to manage than their subordinates. Managers with stronger motivation to manage are promoted faster, are rated as better managers by their employees and earn more than managers with a weak motivation to manage.

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28 CHAPTER ONE

Mistakes Managers Make


A comparison of arrivers, those who made it all the way to the top of the companies, and De-railers, those who successfully early but were knocked off the fast track, by the time they reached middle to upper levels of management Although both groups had talent and weakness, the derailers had some fatal flaws.

Top ten mistakes made by de-railers (see next slide)

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29 CHAPTER ONE

Mistakes Managers Make


1. Insensitive to others 2. Cold, aloof (un-sympatric), arrogant 3. Betrayal of trust (failing to inform others when things will not be done on
time)

4. Overly ambitions 5. Specific performance problems with the business 6. Overmanaging: unable to delegate or build a team

7. Unable to staff effectively


8. Unable to think strategically 9. Unable to adapt to boss with different style 10. Overdependent on advocate or mentor 6
Adapted from Exhibit 1.5 McCall & Lombardo, What Makes a Top Executive? Psychology Today, Feb 1983

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

30 CHAPTER ONE

The First Year Management Transition


Managers Initial Expectations
Be the boss Formal authority

After Six Months As a Manager


Initial expectations were wrong
Fast pace Heavy workload

After a Year As a Manager


Doers (do something)

Manage tasks
Job is not managing people

Communication, listening, positive reinforcement

Learning to adapt Job is to be and control stress problem-solver and troubleshooter Job is people development

Adapted from Exhibit 1.6


31 CHAPTER ONE

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The First Year Management Transition


Initial Assumptions Exercise formal authority Manage tasks, not people Help employees do their jobs Reality Cannot be bossy Manage people, not tasks Coach employee performance

Hire and fire

Fast pace, heavy workload

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32 CHAPTER ONE

Been There Done That


Travis Reynolds, 24, has been a first-level manager for nine months First month was high stress
empowered, but wasnt empowering others

overly tough on employees


tried too hard to prove himself

Learned from his mistakes


learned a new system of management now loves his management job
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33 CHAPTER ONE

Competitive Advantage through People


Companies that practice good management consistently have greater revenues and profits than companies that dont. Good management matters because good management leads to satisfied employees who, in turn, provide better service to customers. Because employees tend to treat customers the same way that their managers treat them, Good management can improve customer satisfaction.

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34 CHAPTER ONE

Competitive Advantage through People


MANAGEMENT PRACTICES (Managers used idea like:)
1. Employment Security
2. Selective Hiring 3. Self-Managed Teams and Decentralization 4. High Wages Contingent on Organizational Performance

5. Training and Skill Development


6. Reduction of Status Differences 7. Sharing Information

Adapted from Exhibit 1.7


35 CHAPTER ONE

Copyright 2005 by South-Western, a division of Thomson Learning. All rights reserved

Competitive Advantage through People


Competitive Advantages of Well-Managed Companies Well managed companies are competitive because:
Work forces are smarter, better trained, more motivated, more committed. This lead to: Greater revenues and profits Satisfied employees who provide better service to customers Improved customer satisfaction
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36 CHAPTER ONE