Welcome to MT140 Introduction to Management Unit 2 Seminar – Foundations of Management

Agenda General Questions and Announcements Introduction Business Organizations as Open Systems Management Environmental Considerations / Q & A Major Management Theories / Q & A Conclusion of Seminar

Unit 2 Objectives During this unit we will: 1.Identify significant past and current management theories 2. Describe the business organization as an open system 3. Identify the role of internal and external environmental factors in business

Key Concepts Organizations are open systems that are influenced by their environment and in turn, influence their environment. All organizations must operate in a macroenvironment. All organizations must operate within a competitive environment.

Businesses are Open Systems Organizations that are affected by, and that affect, their environment. The take in Inputs: In the form of goods and services to create products or services. They produce Outputs: In the form of goods or services. These are in constant interaction with the firm’s environment. These impact and are impacted by both the External Environment and the Macroenvironment.

Inputs Into The Open System Raw Materials Services Equipment Capital (Human Labor, Money, Intellectual, Managerial, etc.) Information (Knowledge)

Outputs Into The Open System Products (Example: Cars, Computers, Furniture, Groceries, etc.) Services (Example: accountants, medical services providers, etc.).

External Environment All relevant forces outside the firm’s boundaries. These include competitors, customers, the government, and the economy. Examples: Copyrights, patents, trademarks, government licenses Industry-specific requirements for entry Specific taxes Interest rates for both customers and business Technological changes that impact the firm (Example: iPods versus tape players; regular cameras versus digital cameras, etc.)

Any questions ?

Macroenvironment A part of the External Environment that forms the general environment for the firm. Includes: Governments (Government actions, rules, laws, regulations, etc.) Economic Conditions (Amount of money, interest rates, etc.) Other fundamental conditions that could affect the firm.

Competitive Environment A part of the External Environment that forms the immediate environment surrounding the firm. Includes: Customers: Current customers as well as potential customers. Rival Firms: Size, efficiency, and market position of current competitors. Potential rival firms: Size, efficiency, and market position of potential competitors. What could customers substitute for your product? Suppliers and others: that the firm needs to conduct business (Distribution channels).

Barriers to Market Entry New firms enter markets when barriers to entry are low and less enter when these increase. Barriers can originate from: Government Policy Capital Requirements Brand Identification Cost Disadvantages Distribution Channels

Ultimately the Customer Decides! Ultimately, it is the customer who determines the success or the failure of a business. Regardless of the type of customer involved, business organizations that create value for their customers will retain their customers and attract new ones. Those that fail to provide perceived value for the customer will eventually lose the customer and fail. Profit is only the measure of how well a business provides value to its customers! Management plays a key role in determining how well a business provides this value.

Any questions ?

Management Theories As you no doubt discovered as you watched the video “The Evolution of Management,” business management theories extend over many years and cover many different aspects of the management function. One way to describe these is to divide them into three broad categories: Scientific Management Theories, Bureaucratic Management Theories, and Human Relations Management Theories.

Management Theories (Continued) Scientific Management Theories: Concerned with specific work tasks. These theories were called “scientific” because they introduced task definition and specific measurement to the process of work (Taylor, Fayol, etc.) Around 1900 until about Our current POLC is derived from Henri Fayol’s Theory circa 1917! What kinds of measurement do we do at work?

Management Theories (Continued) Bureaucratic Management Theories: These added to the measurement and specifications of earlier theories to recognize the need for structure, lines of authority, and control within the management of businesses. It responded to the growth of large business organizations by adding hierarchy to the business structure (Weber, etc. 1930s to 1950s).

Management Theories (Continued) Human Relations Management Theories: This broad range of management theories responded to the impersonal approach of earlier theories by recognizing the uniqueness of humans and the need for managers to resolve the needs of workers. Many of these come from the Behavioral Sciences (McClelland, Maslow, Lewin, McGregor, etc. 1930s to today).

Any questions ?

After this seminar has concluded, there will be a recording in the archives located in the seminar room. It may be selected by date.

Managing

The Tasks Of A Practicing Manager 1.The Managerial Workday is long. 2.Managers are busy and work at a hectic, unrelenting pace. 3.The manager’s day is fragmented. 4.The manager’s work is varied. 5.Managers stay close to home 6.Verbal Activities dominate the manager’s time. 7.Managers use many contacts and tend to network.

The Tasks Of A Practicing Manager 8.Managers tend to develop an individual “art of management.” 9.Managers are proactive planners. 10.Information is the core of management. 11.Managers do not practice time management. 12.Managers lose their rights -Lose your temper -Be one of the gang -Bring your personal problems to work -Vent your frustrations

The Tasks Of A Practicing Manager 12. Managers lose their rights (continued)  Resist Change  Pass the Buck  Get Even  Play Favorites  Put Your Own Interests First  Ask others to do what you wouldn’t  Expect to be immediately recognized and rewarded for doing a good job.

The Roles a Manager Must Perform Mintzberg and others identified ten major roles that managers must fulfill: A. Interpersonal Roles 1. Figurehead 2. Leader 3. Liaison B. Informational Roles 4. Monitor 5. Disseminator 6. Spokesperson

The Roles a Manager Must Perform Mintzberg and others identified ten major roles that managers must fulfill: C. Decisional Roles 7. Entrpreneur 8. Disturbance Handler 9. Resource Allocator 10. Negotiator

Management Style (American versus Japanese) National Culture The Workforce Management Style Superior-Subordinate Relationships Decision Making

Management Style (American versus Japanese) American management style tends to impose control through explicit and formal rules and regulations that documented in corporate operating manuals. Japanese management is more subtle, implicit, and informal

Learning Objectives Summarize major challenges of managing in the new competitive landscape Describe the drivers of competitive advantage for a company Explain how the functions of management are evolving in today’s environment Compare how the nature of management varies at different levels of an organization Define the skills you need to be an effective manager Discuss the principles that will help you manager your career

Managing in the New Competitive Landscape Globalization Technological Change Knowledge Management Collaboration across Boundaries

Managing for Competitive Advantage Key ConceptDefinition InnovationThe introduction of new goods and services QualityThe excellence of your product ServiceGiving customers what they want or need, the way they want it

Managing for Competitive Advantage Key ConceptDefinition SpeedFast and timely execution, response, and delivery of results Cost competitivenessKeeping costs low to achieve profits and offer prices attractive to customers

Managing for Competitive Advantage Key ConceptDefinition Delivering all fiveIncorporating innovation, quality, service, speed, and cost competitiveness Although managers must make some trade-offs, managing for competitive advantage means successfully delivering a winning mix

Defining Management Management -The process of working with people and resources to accomplish organizational goals effectively and efficiently Effectiveness -Achieving organizational goals Efficiency -Achieving goals with minimal waste of money, time, materials, and people

The Functions of Management PlanningDelivering strategic value OrganizingBuilding a dynamic organization LeadingMobilizing people ControllingLearning and changing

Performing all Four Functions of Management A manager’s day is not neatly divided into the four functions Successful managers handle all four functions simultaneously

Management Levels and Skills Top-Level Managers Middle-Level Managers Frontline Managers

Management Levels and Skills Top-level managersSenior executive responsible for the overall management of the organization Middle-level managersLocated in the middle layers of the organizational hierarchy reporting to top-level managers Frontline managersSupervise the operational activities of the organization; also called operational managers

What Do Managers Do?

Management Levels and Skills Working leaders with broad responsibilities -Today’s trends are toward less hierarchy and more teamwork -The best managers are “working leaders”

Skills needed to be an Effective manager Technical Skills Conceptual and Decision Skills Interpersonal and communication skills

Management Levels and Skills Working leaders tend to engage in 10 activities that fall into three categories or roles -Interpersonal roles -Informational roles -Decisional roles

Management Levels and Skills Key SkillDefinition Technical skillThe ability to perform a specialized task involving a particular method or process Conceptual and decisional skills The ability to identify and resolve problems for the benefit of the organization and its members Interpersonal and communication skills People skills; the ability to lead, motivate, and communication effectively with others

You and Your Career Emotional intelligence -Understanding yourselfUnderstanding yourself -Managing yourselfManaging yourself -Dealing effectively with othersDealing effectively with others

You and Your Career

Tips for Success Be both a specialist and a generalist Be self-reliant Be connected Actively manage your relationship with your organization Survive and thrive

You and Your Career Social capital -Goodwill stemming from your social relationships Business decisions both inside and outside the organization involve networks of people Social capital leverages your goodwill to make you and your organization more successful

You and Your Career

Globalization Strong demand for products/services Internet access across the globe Strong demand for talent Global marketplace Return to original slide

Technological Change The Internet’s impact on globalization -Increased speed of communication -The Internet as a marketplace Problems -Stress when employees/supervisors do not set limits on being connected -Lengthening of the workday due to constant access Return to original slide

Knowledge Management Growing need for good, new ideas generates demand for knowledge workers -Managers cannot simply measure output of knowledge workers -Managers should provide knowledge workers with interesting work to increase motivation Return to original slide

Collaboration across Boundaries People in different parts of the organization must collaborate with one another Collaboration also entails moving beyond the boundaries of the organization itself Return to original slide

Innovation Managers must adapt to -Changes in consumer demand -Changes in new competitors Alternative product/service delivery can be as innovative as new products/services themselves Innovation is driven by globalization Return to original slide

Quality Quality standards are increasing Total quality management -Preventing defects before they occur -Achieving zero defects in manufacturing -Designing products for quality Goal: Continuous improvement in how the company operates Return to original slide

Service Continually meet customer needs to establish mutually beneficial long-term relationships Make it easy for customers to experience a service or buy and use products Return to original slide

Speed Speed involves rapidly -Developing and getting products to market -Responding to customer requests Speed combined with quality is a measure of whether a company is operating efficiently Return to original slide

Cost Competitiveness Managing costs requires efficiency -Efficiency is accomplishing goals by using resources wisely and minimizing waste Understanding all product/service specific costs is essential to managing for cost competitiveness Return to original slide

Understanding Yourself Realizing your strengths and limitations Return to original slide

Managing Yourself Dealing with your emotions Making good decisions Seeking and using feedback Exercising self-control Return to original slide

Dealing Effectively with Others Listening Showing empathy Motivating Leading Other similar traits Return to original slide

Questions?

Thank You for Joining Me This Evening! Good Night All!