1. Copyright © 2015 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Management and Leadership CHAPTER 7

2. LEARNING OBJECTIVES 7-2 1. Describe the changes occurring today in the management function. 2. Describe the four functions of management. 3. Relate the planning process and decision making to the accomplishment of company goals.

3. LEARNING OBJECTIVES 7-3 4. Describe the organizing function of management. 5. Explain the differences between leaders and managers, and describe the various leadership styles. 6. Summarize the five steps of the control function of management.

4. SHERYL SANDBERG Facebook 7-4 Displayed her leadership skills as a child and took that with her to Harvard. She joined Facebook in 2008 and made the company profitable in two years. Now shares her knowledge in her book, Lean In.

5. NAME that COMPANY 7-5 This company knows that finding the right people and keeping them happy is the key to long-term business success. So it has its own gourmet chefs prepare delicious lunches, dinners and snacks for its employees. Name that company!

6. WHAT IS MANAGEMENT? 7-6 LO 7-2 Management -- The process used to accomplish organizational goals through planning, organizing, leading and controlling people and other organizational resources.

7. TODAY’S MANAGERS 7-7 LO 7-1 Younger and more progressive.  Growing numbers of women.  Fewer from elite universities. Emphasis is on teams and team building. Managers need to be skilled communicators and team players.

8. RESPECT and HOW to GET IT 7-8 LO 7-1 Source: Entrepreneur, www.entrepreneur.com, accessed November 2014.www.entrepreneur.com

9. EDUCATION MATTERS Alma Maters of CEOs 7-9 LO 7-1 Source: Best Colleges, www.bestcolleges.com, accessed November 2014.www.bestcolleges.com

10. FOUR FUNCTIONS of MANAGEMENT 7-10 LO 7-2

11. TEST PREP 7-11 What are some of the changes happening in management today? What’s the definition of management used in this chapter? What are the four functions of management?

12. SHARING the VISION 7-12 LO 7-3 Vision -- More than a goal, it’s a broad explanation of why the organization exists and where it’s trying to go.

13. DEFINING THE MISSION 7-13 LO 7-3 Mission Statement -- Outlines the organization’s fundamental purposes. It includes:  the organization’s self–concept  its philosophy  long–term survival needs  customer needs  social responsibility  nature of the product or service

14. SETTING GOALS and OBJECTIVES 7-14 LO 7-3 Goals -- The broad, long-term accomplishments an organization wishes to attain. Objectives -- Specific, short- term statements detailing how to achieve the organization’s goals.

15. PLANNING ANSWERS FUNDAMENTAL QUESTIONS 7-15 LO 7-3 What is the situation now? SWOT Analysis -- Analyzes the organization’s Strengths, Weaknesses, Opportunities and Threats. How can we get to our goal from here?  Strategic planning  Tactical planning  Operational planning  Contingency planning

16. SWOT MATRIX 7-16 LO 7-3

17. PLANNING FUNCTIONS 7-17 LO 7-3

18. STRATEGIC and TACTICAL PLANNING 7-18 LO 7-3 Strategic Planning -- Done by top management and determines the major goals of the organization and the policies, procedures, strategies and resources it will need to achieve them. Tactical Planning -- The process of developing detailed, short-term statements about what is to be done, who is to do it and how.

19. Operational Planning -- The process of setting work standards and schedules necessary to implement the company’s tactical objectives. OPERATIONAL and CONTINGENCY PLANNING 7-19 LO 7-3 Contingency Planning -- The process of preparing alternative courses of action the firm can use if its primary plans don’t work out.

20. DECISION MAKING 7-20 LO 7-3 Decision Making -- Choosing among two or more alternatives.

21. WHAT MAKES a GREAT CEO Decision Making Skills of Top CEOs 7-21 LO 7-3 Keep global business issues in mind and be a citizen of the world. Identify and manage risks before they grow. Change strategies and models with the times. Skillfully manage relationships with governments as government involvement rises. Source: Fortune, www.fortune.com, accessed November 2014.www.fortune.com

22. RATIONAL DECISION-MAKING MODEL 7-22 LO 7-3 1. Define the situation. 2. Describe and collect needed information. 3. Develop alternatives. 4. Decide which alternative is best. 5. Do what is indicated. 6. Determine whether the decision was a good one and follow up.

23. PROBLEM SOLVING 7-23 LO 7-3 Problem Solving -- The process of solving the everyday problems that occur; less formal than decision making and needs quicker action. Problem-solving techniques include brainstorming and PMI -- Listing all the pluses for a solution in one column, all the minuses in another and the implications in a third.

24. TEST PREP 7-24 What is the difference between goals and objectives? What does a company analyze when it does a SWOT analysis? What are the differences between strategic, tactical and operational planning? What are the six Ds in decision making?

25. LEVELS of MANAGEMENT 7-25 LO 7-4

26. MANAGEMENT LEVELS 7-26 LO 7-4 Top Management -- The highest level, consists of the president and other key company executives who develop strategic plans. Middle Management -- Includes general managers, division managers, and branch and plant managers who are responsible for tactical planning and controlling. Supervisory Management -- Those directly responsible for supervising workers and evaluating daily performance.

27. TOP MANAGEMENT 7-27 LO 7-4 Chief Executive Officer (CEO)  Introduces change into an organization. Chief Operating Officer (COO)  Implements CEO’s changes. Chief Financial Officer (CFO)  Obtains funds, plans budgets, collects funds, etc. Chief Information Officer (CIO)  Gets the right information to the right people so decisions can be made.

28. Source: Fortune Magazine, www.fortune.com, accessed November 2014.www.fortune.com AMERICA’S MOST POWERFUL FEMALE MANAGERS 7-28 LO 7-4

29. MANAGERIAL SKILLS 7-29 LO 7-4 Technical Skills -- The ability to perform tasks in a specific discipline or department. Human Relations Skills -- Skills that involve communication and motivation; they enable managers to work through and with people. Conceptual Skills -- Skills that involve the ability to picture the organization as a whole and the relationship among its various parts.

30. SKILLS NEEDED at VARIOUS LEVELS of MANAGEMENT 7-30 LO 7-4

31. THANK YOU The Most Basic Human Relations Skill 7-31 LO 7-4 Saying “thank you” has led to happier employees and greater profits for companies. Whom should a manager thank? 1. Interns - Doing lots of work for little money, they are the future of the company and industry. 2. Lawyers - Many do pro bono work, even for nonprofit companies. 3. The little people - Mailroom, repair, and cleaning staff keep the office running day-to-day. Source: Fast Company, www.fastcompany.com, accessed November 2014.www.fastcompany.com

32. BACK to SCHOOL for TOP MANAGERS 7-32 Business leaders need to study international political, legal, and regulatory systems. Each local market requires their own set of global standards. Some companies, like Coca-Cola, Nestle, and IBM have done a noteworthy job of assessing and understanding global challenges.

33. Staffing -- Recruiting, hiring, motivating and retaining the best people available to accomplish the company’s objectives. STAFFING 7-33 LO 7-4 Recruiting good employees is critical. Many people are not willing to work at companies unless they are treated well with fair pay.

34. Source: CareerBuilder, www.careerbuilder.com, accessed November 2014.www.careerbuilder.com STAFFING is TRICKY BUSINESS Six Sins of Staffing 7-34 LO 7-4 1. Don’t hire someone because someone else says so. 2. Don’t get caught up in applicants’ appearances. 3. Don’t give someone the wrong job. 4. Don’t forget about feedback. 5. Don’t give promotions just because it’s time. 6. Don’t cheat your employees.

35. LEADERSHIP 7-35 LO 7-5 Leaders must:  Communicate a vision and rally others around that vision.  Establish corporate values.  Promote corporate ethics.  Embrace change.  Stress accountability and responsibility.

36. WHAT DO YOU TELL the TEAM? 7-36 As a first-line manager, you have new information that your department head hasn’t seen yet. The findings of the report indicate your manager’s plans should fail. If they do fail, you could be promoted. Will you give your department head the report? What is the ethical thing to do? What might be the consequences?

37. ACCOUNTABILITY through TRANSPARENCY 7-37 LO 7-5 Transparency -- The presentation of the company’s facts and figures in a way that is clear and apparent to all stakeholders.

38. LEADERSHIP STYLES 7-38 LO 7-5 Autocratic Leadership -- Making managerial decisions without consulting others. Participative or Democratic Leadership -- Managers and employees work together to make decisions. Free-Rein Leadership -- Managers set objectives and employees are free to do whatever is appropriate to accomplish those objectives.

39. VARIOUS LEADERSHIP STYLES 7-39 LO 7-5

40. NATURAL BORN LEADERS? Four Types of Executives RationalistsHumanists PoliticistsCulturists 7-40 LO 7-5

41. EMPOWERMENT 7-41 LO 7-5 Progressive leaders give employees the authority to make decisions on their own without consulting a manager. Customer needs are handled quickly. Manager’s role becomes less of a boss and more of a coach. Enabling -- Giving workers the education and tools they need to make decisions.

42. Source: Bloomberg BusinessWeek, www.businessweek.com, accessed November 2014.www.businessweek.com WORK SMARTER How to Ease Pressure on Workers 7-42 LO 7-5 Manage output instead of hours. Train workers to be ready for a more complex corporate structure. Allow lower-level managers to make decisions. Use new technology to foster teamwork. Shift hiring emphasis to collaboration.

43. MANAGING KNOWLEDGE 7-43 LO 7-5 Knowledge Management -- Finding the right information, keeping the information in a readily accessible place and making the information known to everyone in the firm. Tries to keep people from reinventing the wheel.

44. USING SOCIAL MEDIA DURING the WORST of TIMES 7-44 Many companies use sites like Twitter and Facebook to proactively and reactively communicate with their customers. When GM was going through a massive recall, CEO, Mary Barra, insisted on using social media. Complaints were quickly read, responded to, and resolved.

45. FIVE STEPS of CONTROLLING 7-45 LO 7-6

46. Source: CFO Magazine, www.cfo.com, accessed November 2014.www.cfo.com ARE YOU a MICROMANAGER? 7-46 LO 7-6 Do you have strategic initiatives that you have not addressed? Do you often check on employees for quality control? Do you often check on subordinates throughout the day? Do you rarely take vacations? Is there a lot of turnover?

47. MEASURING SUCCESS 7-47 LO 7-6 Traditional forms of measuring success are financial. Pleasing employees, stakeholders and customers is important. External Customers -- Dealers, who buy products to sell to others, and ultimate customers (or end users), who buy products for their own use. Internal Customers -- Individuals and units within the firm that receive services from other individuals or units.

48. TEST PREP 7-48 How does enabling help achieve empowerment? What are the five steps in the control process? What’s the difference between internal and external customers?