1. The Challenge of Management Chapter 1
This chapter overviews the management process, focusing on managers’ actual activities and on the skills and knowledge needed to be effective and innovative. However, innovative practice does not emerge in a vacuum; it builds on management’s best ideas.
Prepared by C.J. Bamforth

2. Learning Objectives
LO1 – Explain four management functions and their interrelationships.
LO2 – Identify three common managerial work methods influencing managers.
LO3 – Describe the 10 major roles that managers need to engage in.
LO4 – Factors influencing work agendas and how these agendas can channel managers’ efforts.
LO5 – Delineate three major managerial skill types.
LO6 – Distinguish between effectiveness and efficiency in organisational performance.
LO7 – Explain how managers’ jobs differ between hierarchical levels and how managers can foster innovation through the entrepreneurial role.
LO8 – Identify significant twenty-first century management trends.
After studying this chapter you should be able to:
LO1 - Explain the four management functions and their interrelationships.
LO2 - Identify three common managerial work methods that influence what managers do and provide practical examples of how these apply.
LO3 - Describe the 10 major roles that managers need to engage in.
LO4 - Identify the main factors influencing work agendas and how these agendas can channel managers’ efforts.
LO5 - Delineate three major managerial skill types.
LO6 - Distinguish between effectiveness and efficiency in regard to organisational performance.
LO7 - Explain how managers’ jobs differ between hierarchical levels and how managers can foster innovation through the entrepreneurial role.
LO8 - Identify significant twenty-first century management trends.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-2

3. What is Management?
The process of effectively and efficiently planning, organising, leading and
controlling people to achieve the organisation’s goals and objectives whilst
balancing the demands and pressures of the external environment.J
Organisational view of the ongoing Management Process
Process of Management
EFFICIENTLY
EFFECTIVELY
Planning
Organising
Controlling
Leading
Results in
Company Goals
What is management?
The process of effectively and efficiently planning, organising, leading and controlling people to achieve the organisations goals and objectives whilst balancing the demands and pressures of the external environment.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-3

4. LO1 - Four Functions of Management
Organisational goals
Efficiency & Effectiveness
Planning
Organising
Leading
Controlling
Identifying where the organisation wants to go and how they will get there
Ensuring necessary resources are in place
Motivating and guiding resources to achieve targets
Checking that the right goal is being chased and that resources are not being wasted
Throughout the years, academic theorists have described the process of management in various ways. However, within business organisations, it is generally considered and accepted as effectively and efficiently guiding people to achieve the organisations goals and objectives through the Planning, Organising, Leading and Controlling functions. Some earlier management academics (Henri Fayol circa 1872) also include the headings Coordinating, Staffing and Motivating. Later theorists have condensed the function of Coordinating into the Planning function, Staffing into the Organising function and Motivating into the Controlling (Monitoring) function.
Planning: Planning is the management function that involves goals/objectives and deciding plans, actions and strategies on how to best achieve goals.
Organising: Organising is the management function that is focused on allocating and arranging resources, on both human and non-human, so that plans can be successfully implemented.
Leading: Leading is the managerial function in which others are influenced to engage in work behaviours to reach organisational goals. Leading includes communicating with others, helping to outline a vision of what can be achieved, giving direction, and motivating and inspiring organisation members to put in the necessary effort. The function also includes encouraging the required levels of change and innovation.
Controlling: Controlling is the management function regulating organisational activities to ensure that actual performance conforms to the standards and goals expected (Newman 1975 in Bartol et al, 2011). To regulate, managers monitor ongoing activities, establish standards, compare results with established standards or progress towards goals, and take the necessary corrective action.
Do you think that the POLC framework has value for use outside of business?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-4

5. An Organisation’s Business Environment
Mega or Macro Environment
Task or Operating Environment
The Organisation’s internal environment
You
Influences
Influences
Influences
An organisation is often strongly influenced by the environment in which it operates. The mega or macro environment refers to the influences in the global environment which can impact the organisation. For example, the Global Financial Crisis meant that there was less money available from the share market and banks to fund operations and growth strategies. An organisation has little control over these mega or macro influences.
However the organisation does have some control and influence over its immediate (task or operating) environment. For example, its behaviour can influence how its competitors behave in the market and towards it.
Both sets of external environmental factors impact the organisations operations, including the organisational culture i.e. how the organisation behaves (or rather how the individuals who make up the organisation behave together).
At the centre of the circles is you, assuming that you work for this organisation. As with the organisation itself, your level of influence over environmental factors is likely to be greatest in those factors immediately impacting you e.g. the organisational culture.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-5

6. The Management Process
External (general/mega) Environment, Political, Legal, Economic, Socio cultural, Technological, International, Government
Influences
Organisation Size
Finally leads to HOW an organisation efficiently & effectively produces goods, services and information (GOODS)
Organisation Culture
Management process
Organising
Resources and Inputs
Planning
Leading
Controlling
Organisation Culture
This diagram shows the range of factors that impact the management process i.e. the planning, organising, leading and controlling functions. It builds on and draws from earlier slides.
Organisation Size
Influences
External (Specific) Environment: e.g. Competitors, Legal, Suppliers, Creditors, Customers, Labour market, Unions, Shareholders etc; sometimes known as the Task environment
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-6

7. An Extended Model of the Management Process
Internal Organisation Environment
Organisations - Vision, Mission, Culture, Stakeholders
OUTPUTS
INFLUENCES
Planning
Controlling
Leading
Organising
Organisational Performance
Workplace
Resources
Work Agendas
Knowledge Base
Management skills
I.T.
Human Resources
Raw Materials
Financial
Overall Performance
Services
Products
Goal Achievement
This diagram focuses on the internal management process and shows how the organisation’s goals (vision, mission, strategies etc) influence the organisation’s operations i.e. the conversion of inputs into valuable outputs that are then purchased by the organisation’s customers.
INPUTS
TRANSFORMATION
Customer / Stakeholder Feedback
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-7

8. LO2 - Three Common Managerial Work Methods
What are the characteristics of a manager’s day?
Unrelenting Pace
Brevity, Variety & Fragmentation
Verbal Contracts & Networks
Prior to Mintsberg’s work in 1980, the assumption was that managers were reflective, systematic individuals who spent much of their time reading reports and getting on quietly with their work. For many of us working in business we know that this is not the case. Mintsberg’s research showed that in fact a manager’s day was fast paced, fragmented, contained multiple interruptions and consisted of multiple tasks and activities. Generally, there was little time available to sit quietly and read reports. Instead, managers relied heavily on their verbal contacts and networks to get a quick feel for what was going on. Report reading was reserved for more in detail study.
What does this mean for us? That to get our work done we need to be adaptive as well as proficient at the management functions.
What type of skills do managers need to manage these work methods?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-8

9. LO3 - Mintsberg’s 10 Managerial Roles
Interpersonal Role
Figurehead: Performs symbolic duties of a legal or social nature
Leader: Builds relationships with subordinates and communicates with, motivates and coaches them
Liaison: Maintains networks of contacts outside work unit who provide help and information
Informational Role
Monitor: Seeks internal and external information about issues affecting organisation
Disseminator: Transmits information internally obtained from either internal or external sources
Spokesperson: Transmits information about the organisation to outsiders
Decisional Role
Entrepreneur: Acts as initiator, designer and encourager of change and innovation
Disturbance Handler: Takes corrective action when organisation faces important, unexpected difficulties
Resource Allocator: Distributes resources of all types including time, funding, equipment and human resources
Negotiator: Represents the organisation in major negotiations affecting the manager’s areas of responsibility
This table shows the various roles and associated activities that managers may be involved in on a ‘day to day’ basis. It highlights the variety of skills that a manager needs to be successful.
These roles can broadly be divided into three key areas:
Interpersonal roles which involve “developing and maintaining positive relationships with significant others” (Bartol et al, 2011, p.8).
Informational roles which involve receiving and passing on information that is essential to the successful operation of the organisation.
Decisional roles which involve making organisational decisions around the planning, organising, leading and controlling functions.
Do you use any of these roles in everyday life?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-9

10. LO4 –Factors Influencing Work Agendas
Job Demands
Activities a manager must do in a job
For example, managers’ responsibilities usually relate to significant major organisation goals and plans.
Job Constraints
Internal and external organisation factors, which limit what a manager can do
Constraints include resource limitations, legal restrictions, union activities, technological limitations and how much a managers’ work unit is defined.
Job Choices
Work activities that a manager can do but does not have to do
For example, without being directed, a manager might initiate a proposal to develop a computerised customer service tracking system. Work agendas therefore tend to reflect individual managers personal preferences and career objectives.
Three main factors influence our work agendas – the demand of the job, the constraints placed upon us and our choice of what we focus on. This slide discusses these in detail.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-10

11. LO5 –Key Management Skills
Human skills
Conceptual skills
Technical skills
As you move up the managerial levels are all of these skills used equally?
The three major skills that managers need are:
Conceptual skills – the ability to think analytically and achieve integrative problem solving
Human skills – the ability to work well in cooperation with other people
Technical skills – the ability to apply expertise and perform a special task with proficiency
Whilst human skills remain important at all managerial levels, conceptual skills are more important as you move up the managerial levels and technical skills are more important at the lower managerial levels. Can you think why this is?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-11

12. LO6 Efficiency & Effectiveness in terms of Organisational Performance
(doing the right things)
Efficiency
(not wasting resources)
Performance
Effectiveness and efficiency are two key management building blocks. They underpin many management theories so it is useful to know what they mean.
Effectiveness is the ability to choose appropriate goals and achieve them. An organisation is effective when managers choose appropriate goals and then achieve them.
Efficiency is the ability to make the best use of available resources in goal achievement. Organisations are efficient when managers minimise input resources (labour, raw materials and components) or the time needed to produce a given output or service.
In essence, organisations must be both effective (doing the right things) and efficient (doing things right) to perform well.
How does effectiveness & efficiency contribute to performance?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-12

13. LO7 Hierarchical Levels and Management Responsibilities
Strategic focus
Implementation of plans
Operational focus
So what do managers do as they move up through the organisation?
First-Line Managers: at the lowest hierarchical level, first line managers or supervisors generally operate and are responsible for operational (non-managerial) employee work. First line managers are vital to the success of organisational goals, as they are responsible for smooth daily operations.
Middle Managers: below top hierarchical levels and directly responsible for lower level managerial work are middle managers. They may be directly responsible for other middle or first line managers. They may supervise operating staff such as administrative assistance and specialists (e.g. engineers or financial analysts etc.). They are responsible for implementing overall organisational plans to achieve organisational goals
Top Managers: are the very top hierarchical levels and responsible for the whole organisation. Top managers are responsible for the upper layer of middle managers, typically overseeing overall organisation planning, working with middle managers to implement planning, and maintaining control over the organisation’s progress.
Managerial jobs vary on two important dimensions. One is a vertical dimension, focusing on different hierarchical levels. The other is a horizontal dimension addressing variations in managers’ responsibility areas.
Along the vertical dimensions, managerial jobs fall into three categories: first line managers, middle managers and top managers. The categories represent vertical differentiation among managers as they involve different organisation levels, as seen in the figure above.
How do managerial responsibilities change as you
move up the vertical levels of management?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-13

14. Functions of Management
While the same managerial skills apply at all hierarchical levels, the importance of each one varies as managers roles and responsibilities change.
As shown in the diagram above, the planning function is more important for top managers than for middle or first line managers. This is because top managers set the organisation’s overall direction, which needs extensive planning. Similarly, the organisation function is more important for top and middle managers than for first line managers. This stems from the greater responsibility carried by top and middle management levels for allocating and arranging resources, though first line supervisors may also do this. In contrast, the leading function is more important for first line supervisors than for high level managers. This is because first line supervisors are in charge of producing goods or services, therefore they use more communicating, motivating, directing and supporting skills. Finally, the management function common to all levels is controlling. This shows a common emphasis on monitoring activities and taking corrective action.
Why do the requirements for different skill sets change as you move up the managerial levels?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-14

15. Management Skills and Hierarchical Levels
In the slide for LO5 we raised the question of whether the three skills (technical, human and conceptual) were used equally as you move up through the managerial levels. This slide shows the change in their relative importance and picks up on the changes in roles and responsibilities discussed in the previous slide.
Generally top management need conceptual skills the most. These managers must see the organisation as a whole, understand how its parts relate to each other and link to the outside world (Maruca 1994 in Bartol et al, 2011).
In contrast, first line managers have the greatest need for technical skills, as they supervise most non-managerial, technical and professional employees. Yet middle managers often need technical skills to communicate with subordinates and recognise major problems (Torrington & Weightman 1987 in Bartol et al, 2011). When technology is important to organisational products or services, even top managers must have some technical skills. Otherwise, upper level managers cannot foster innovation, allocate resources efficiently or devise competitive strategies. Unsurprisingly, all management levels need strong human skills to get things done through people (Pavett & Lau 1983 in Bartol et al, 2011).
Why does the requirement for skill sets change as you move up the managerial levels?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-15

16. Comparing the pair Function focus by management level Skill level by
So what happens when we put these two charts together? Is there any possible overlap between the skill sets required for each functional role?
Is there any overlap between the skills managers need at different levels and the functions they do?
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e

17. Promoting Innovation : the Entrepreneurial Role
What does innovation mean in an organisation?
What role does each of the following play in bringing innovations to market?
Idea generators or champion
Sponsors
Orchestrators
How can managers encourage innovation through an entrepreneurial role?
Innovation is a new idea involving initiating or improving a process, product or service (Canter 1983 in Bartol et al, 2011). The innovation process is closely related to the entrepreneurial role, which relates to finding and exploiting new opportunities. In fact, innovative activities are often known as entrepreneurship in organisations.
Those engaging in entrepreneurial roles in organisations are called intrapreneurs. This distinguishes innovators working inside existing organisations from those who innovate by creating new ones (often called entrepreneurs). Similarly, innovating in an existing organisation is referred to as intrapreneurship.
Successful innovations are rarely one person’s work. For the innovation process to be successful it usually needs people at different levels to fulfil three important roles: idea generator or champion; sponsor; and orchestrator (Galbraith 1982 in Bartol et al, 2011).
The idea champion is responsible for generating the new idea, or believes in its value and supports it despite many potential barriers. Such people are called entrepreneurs, inventors, creative individuals or risk takers. They usually operate at lower organisation levels, see a problem and help develop a solution. First line supervisors are idea champions, picking up on new ideas and then nurturing and development them as they fight for survival. Idea champions are low in the hierarchy, they often lack power and status to get innovations accepted. This creates a need for the next type of role.
The sponsor is usually a middle manager, who recognises an idea’s significance, helps get the funding needed to develop the innovation and facilitates its implementation. As middle managers, sponsors have a high enough position to get the necessary backing for an innovation to survive. But sponsors alone cannot guarantee an innovation is taken up; they need an orchestrator to do that.
An orchestrator or high level manager shows the need for innovation, funds innovating activities, creates incentives for middle managers to sponsor new ideas and protects ‘ideas people’. Because innovation may challenge established ways of doing things, those happy with or interested in the status quo will resist it (for example an expert in a process may resist a change as it outmodes the process). An orchestrator balances power so that new ideas can be tested despite negative responses. By acting as orchestrator, top managers encourage innovation.
All three roles are necessary if major innovations are to be developed, implemented and last.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-17

18. LO8 Managing in the 21st Century
Changing assumptions about managers (Drucker, 1999)
The need to manage:
Change and innovation
Diversity and global factors
Changing modes of operation
Total quality management issues
Business process re-engineering
Technology, in particular the internet
Sustainability from an economic, social and environmental perspective
Knowledge & the learning organisation
Can you provide examples for each of the above?
Can you think of any other ones?
This slide provides an overview of some of the current key management trends . These are discussed in detail on pages of Bartol et al, Can you think of any other ones?
Drucker’s (1999) assumptions highlight the growing complexity around management – the fact that what people manage, how they manage and who they manage has changed dramatically. Drucker’s list can be found on p.17 of Bartol et al, 2011.
Organisations today are often under considerable pressure to innovate themselves out of problems and to embrace change in multiple areas. This includes dealing with environmental changes, shifts in employee and end customers’ characteristics and accessibility, global factors (e.g. the global financial crisis), changing modes of operation and data/information overload. As managers we will be at the front edge of these changes and organisations will look to us to come up with and implement strategies that address them. In particular we will be asked to deliver results that address economic (money & profit), social (employee, community and customers) and environmental (resources) considerations.
Each of these is discussed in more detail on pages 21 to 26, Bartol et al, 2011.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-18

19. Conclusion This presentation explores the roles that managers play.
It identifies some of the challenges facing managers operating in today’s complex business environment.
It presents evidence that questions the idea that managers operate in stable environments which allow them considerable time for reflection and action.
It highlights the need for managers to have multiple skills and abilities in order to position their organisations for competitive success.
Copyright  2011 McGraw-Hill Australia Pty Ltd PowerPoint slides to accompany Bartol et al, Management Foundations 3e
1-19