Welcome to AB140 Introduction to Management Unit 2 Seminar – Foundations of Management

Seminar Ground Rules Respond to classmate’s comment using their first name – “John: My perspective is…” Respond to the entire class – “To All: My perspective is…” Respond to instructor – “Denise: I would…”, or “Prof.”

Seminar Ground Rules If you have a question, please just ask. Do not ask if you can ask a question. You are welcome to respond to questions I pose to other students Try to add value to each response

Seminar Ground Rules Please do not continue a conversation once we move on to another topic Avoid Side Conversations Seminar is 1 Hour

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Agenda Management Functions Management Levels Unit 2 Introduction Competitive Environments and Macroenvironments Evolution of Management Theories Unit 2 Coursework Conclusion of Seminar

What Managers Do: POLC P = Planning: The management function of systematically making decisions about goals and activities that an individual, a group, a work unit, or the overall organization will pursue. O = Organizing: The management function of assembling and coordinating human, financial, informational, and other resources needed to achieve goals. L = Leading: The management function that involves the manager’s efforts to stimulate high performance by employees. C = Control: The management function of monitoring performance and making needed changes.

Management Levels and Skills Top-level managers -Strategic managers -Focus on long-term issues -Concerned with interaction of organization and external environment Middle-level managers -Tactical managers -Translate general goals into specific objectives -Interpret top management goals downward -Translate information from frontline management upwards Frontline managers -Operational managers -Implement plans from middle managers -Directly involved with non-management employees

Skills for Effective Management Technical Interpersonal and communication Conceptual and decision making skills Emotional Intelligence

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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 Macroenvironment and the Competitive Environment

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.).

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.) Technological forces (New markets, industries, techniques, etc.) Labor Force Demographics (age, gender, education, etc. ) Social Issues

Macroenvironment What are some of the challenges within these elements of the macroenvironment that managers in the fast food industry are facing today? Government actions Economic conditions Technological forces Labor forces Social issues

Competitive Environment A part of the External Environment that forms the immediate environment surrounding the firm. Includes: Rival Firms: regional, domestic, global, Internet New Entrants: Are there many or few barriers to entering industry? Substitutes and Complements substitute is a potential threat complement potential opportunity Suppliers: provide people, raw materials, information, financial capital Customers: Current customers as well as potential customers.

Substitutes and Complements Rival → Same Product -Coke vs. Pepsi Substitute → Threat -Netflix or movie theater -Starbucks or Jamba Juice -McDonalds or “the refrigerator” Complement → Opportunity -ink cartridges and printers -video games and game consoles -hotdogs and home improvement

Drivers of Competitive Advantage Innovation Service Quality Speed Cost Competitiveness

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Evolution of Management Theory Classical Approach: Late 1800’s Behavioral Approach: Early 1900’s Systems Approach: 1930’s – 1940’s Contingency Approach: 1960’s

Classical Approach (Late 1800’s) Scientific Management Emphasizes manager’s role in formal hierarchy of authority Focus of tasks, machines and systems to perform tasks efficiently Frederick Taylor -Develop one best way to perform a tasks -Scientifically select, train, teach and develop each worker -Cooperate with workers and provide incentive -Divide work and responsibility equally between management and labor Administrative Management organizing work of entire organization not just individual workers

Behavioral Approach (Early 1900’s) Understanding people’s needs and attitudes within a formal organization Hawthorne Study -Lead by Elton Mayo -Western Electric Hawthorne Plant -Spanned 9 years -Purpose: determine what circumstances in workplace had greatest effect on output -Experimented with lighting, hours, rest periods, incentives, etc. -Conclusion: good social relations and feeling valued produces more output

Systems Approach (1930’s-1940’s) Organization is system of interrelated parts to be managed as a whole to achieve a common goal Inputs, transformation processes, outputs, feedback W. Edwards Deming -Continuous Improvement -Total Quality Management -All dimensions of organization and its environment considered one system

Contingency Approach (1960’s) “It Depends” Identify key variables in each situation Understand relationships among variables Understand causes and effects of managerial decisions

Evolution of Management Theory Classical Approach: Improved Efficiency Behavioral Approach: Improved Management/Worker Relationship Systems Approach: Improved Quality Contingency Approach: Improved Managerial Decision Making

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Unit 2 Coursework Reading -Chapter 2 Bateman and Snell; Library Article Discussion - Scenario and question concerning competitive environment – substitutes and complements Assignment -“Evolution of Management” Video - How do theories differ? Which do you think is more important? Why? Quiz - Questions concerning textbook reading

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