Chapter 1: Management Fundamentals Business Leadership: Management Fundamentals John R. Schermerhorn, Jr., Barry Wright, and Lorie Guest © John Wiley & Sons Canada, Ltd.

Planning Ahead — Chapter 1 Learning Goals Understand the current workplace environment in Canada Identify the characteristics of an organization Understand who managers are and what they do Describe the management process and how managerial skills and competencies are learned

Overview of the New WorkPlace The dynamics of ever-present change extend into the workplace and raise a host of new career challenges. Smart people commit their energies and intellect to continuous learning and personal development. Companies with a future are committed to people. Companies with a future offer inspirational leadership and rewards, respect people, and provide supportive work environments. High performing companies gain extraordinary results from people.

WORKING TODAY Talent Diversity Globalization Technology Ethics Careers

Talent People and their talents are the ultimate foundations of organizational performance. Intellectual capital is the collective brainpower or shared knowledge of a workforce that can be used to create value. A knowledgeable worker’s mind is a critical asset to employers and adds to the intellectual capital of an organization.

DIVERSITY Workforce diversity reflects differences with respect to gender, age, race, ethnicity, religion, sexual orientation, and able-bodiedness. A diverse and multicultural workforce both challenges and offers opportunities to employers. Many call diversity a “business imperative” and view it as an asset.

Diversity (Cont’d) How diversity bias can occur in the workplace: Prejudice: the display of negative, irrational attitudes toward members of a diverse population. Discrimination: actively denies minority members the full benefits of organizational membership. Glass ceiling effect: an invisible barrier limiting career advancement of women and minorities.

VideO: A Science Glass Ceiling - Globe & mail (external link) Link to video: http://www.theglobeandmail.com/news/national/education/video-a-science-glass-ceiling/article6330139/

GLOBALIZATION National boundaries of world business have largely disappeared. Globalization is the worldwide interdependence of resource flows, product markets, and business competition that characterize the new economy. © John Wiley & Sons Canada Ltd.

TECHNOLOGY Continuing transformation of the modern workplace through: The Internet World Wide Web Computer networking Information technology Telecommuting/virtual teaming/mobile offices Increasing demand for knowledge workers with the skills to fully use technology.

Video: SOCIAL MEDIA revolution Social Media Revolution by Erik Qualman (external link) Link to video: http://www.youtube.com/v/TXD-Uqx6_Wk?hl=en_US&version=3&rel=0

ETHICS Ethics Code of moral principles that set standards of conduct of what is good and right Ethical expectations for modern businesses: Integrity and ethical leadership at all levels Sustainable development Natural environment protection Consumer protection Human rights

CAREERS Core workers, contract workers, and part-time workers People must be prepared to be any one of these types of workers People must make sure that their skills are portable and of current value in employment markets

EARLY CAREER SURVIVAL SKILLS Critical skills for success in the new workplace Mastery Networking Entrepreneurship Love of technology Marketing Passion for renewal

What is an organization? A collection of people working together to achieve a common purpose Organizations provide useful goods and/or services that return value to society and satisfy customer needs

organizations (Cont’d) Organizations are open systems Composed of interrelated parts that function together to achieve a common purpose Interact with their environments Transform resource inputs into product outputs (goods and services) Environmental feedback tells organization how well it is meeting the needs of customers and society

Figure 1.3 organizations as open systems

organizations (Cont’d) Organizational performance “Value creation” is a very important notion for organizations Value is created when an organization’s operations adds value to the original cost of resource inputs When value creation occurs: Businesses earn a profit Nonprofit organizations add wealth to society © John Wiley & Sons Canada Ltd.

Organizational performance Productivity An overall measure of the quantity and quality of outputs relative to the cost of inputs Performance effectiveness An output measure of task or goal accomplishment Performance efficiency An input measure of the resource costs associated with goal accomplishment

Figure 1.4 productivity and the dimensions of organizational performance

Changing nature of organizations Workplace changes that provide a context for studying management: Renewed belief in employees Disappearance of “command-and-control” Emphasis on teamwork Prominence of technology Embrace of networking New workforce expectations Concern for work-life balance Focus on speed

Managers in the new workplace Importance of human resources and managers People are not ‘costs to be controlled.’ High performing organizations treat people as valuable strategic assets. Managers must ensure that people are treated as strategic assets.

managers Directly support and help activate the work efforts and performance accomplishments of others The people who managers help are the ones whose tasks represent the real work of the organization

Levels of management Top managers: responsible for the performance of an organization as a whole or for one of its larger parts Middle managers: in charge of relatively large departments or divisions Team leaders or supervisors: in charge of a small work group of non-managerial workers

Figure 1.5 management levels in a typical business and non-profit organizations

Responsibilities of team leaders Plan meetings and work schedules Clarify goals and tasks, and gather ideas for improvement Appraise performance and counsel team members Recommend pay raises and new assignments Recruit, train, and develop team members

Types of managers Line managers: are responsible for work activities that directly affect organization’s outputs Staff managers: use technical expertise to advise and support the efforts of line workers Functional managers: are responsible for a single area of activity General managers: are responsible for more complex units that include many functional areas Administrators: work in public and nonprofit organizations

Organizational effectiveness In order to attain sustainable high performance, organizations use resources effectively to accomplish missions and objectives. The Systems Resource Approach focuses on resource acquisition The Internal Process Approach focuses on operations efficiency The Goal Approach focuses on accomplishing key objectives Strategic Constituencies focus on stakeholder impact

Managerial performance Accountability is the requirement of one person to answer to a higher authority for relevant performance results. Effective managers fulfill performance accountability by helping others to achieve high performance outcomes and experience satisfaction in their work.

Managerial performance (Cont’d) Quality of work life (QWL) An indicator of the overall quality of human experiences in the workplace QWL indicators: Fair pay Safe working conditions Opportunities to learn and use new skills Room to grow and progress in a career Protection of individual rights Pride in work itself and in the organization

High performing managers Are well informed of their team’s needs Work alongside those they supervise Provide advice and develop support for their team Help others perform to the best of their abilities

The organization as an upside-down pyramid Reflects the changing nature of work today A manager’s job is to support workers’ efforts Whole organization is devoted to serving the customer

Figure 1.6 – the organization as an upside-down pyramid

Management process Managers achieve high performance for their organizations by best utilizing its human and material resources. Management is the process of planning, organizing, leading, and controlling the use of resources to accomplish performance goals. All managers are responsible for the four functions. The functions are carried on continually.

Figure 1.7 the four functions of management

Functions of management Planning: The process of setting objectives and determining what actions should be taken to accomplish them Organizing: The process of assigning tasks, allocating resources, and arranging the coordinated activities of individuals and groups to implement plans

Functions of management (Cont’d) Leading: The process of arousing people’s enthusiasm to work hard and direct their efforts to fulfill plans and accomplish objectives Controlling: The process of measuring work performance, comparing results to objectives, and taking corrective action as needed

Managerial roles and activities Informational roles: Involves giving, receiving, and analyzing information Interpersonal roles: Involves interactions with persons inside and outside the work unit Decisional roles: Involves using information to make decisions, solve problems, or address opportunities

Figure 1.8 mintzberg’s 10 managerial roles

Characteristics of managerial work Managers work long hours Managers work at an intense pace Managers work at fragmented and varied tasks Managers work with many communications media Managers work largely through interpersonal relationships

Managerial agendas and networks Agenda setting Development of action priorities for one’s job Include goals and plans that span long and short time frames Networking Process of building and maintaining positive relationships with people whose help may be needed to implement one’s work agendas Social Capital Capacity to attract support and help from others in order to get things done

Essential managerial skills Learning The change in a behaviour that results from experience Lifelong learning The process of continuously learning from daily experiences and opportunities Career success depends on real commitment to learning Not just formal classroom learning

Essential managerial skills (Cont’d) Skill: the ability to translate knowledge into action that results in desired performance Technical skill: the ability to apply a special proficiency or expertise to perform particular tasks Human or interpersonal skill: the ability to work well in cooperation with others Emotional intelligence is the ability to manage ourselves and relationships effectively Conceptual skill: the ability to think critically and analytically to solve complex problems

Figure 1.9 katz’s essential managerial skills

Managerial competency A skill-based capability that contributes to high performance in a management job

Competencies for managerial success Communication Teamwork Self-management Leadership Critical thinking Professionalism © John Wiley & Sons Canada Ltd.

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