Essentials of Contemporary Management Chapter Chapter 1 The Management Process The Management Process PowerPoint Presentation by Charlie Cook © Copyright The McGraw-Hill Companies, Inc., 2004 All rights reserved Learning Objectives Learning Objectives • After studying the chapter, you should be able to: Describe what management is, why management is important, what managers do, and how managers utilize organizational resources efficiently and effectively to achieve organizational goals Distinguish among planning, organizing, leading, and controlling (the four managerial functions), and explain how managers’ ability to handle each one can affect organizational performance © Copyright 2004 McGraw-Hill 1–2 Learning Objectives (cont’d) Learning Objectives (cont’d) Differentiate among three levels of management, and understand the responsibilities of managers at different levels in the organizational hierarchy Identify the roles managers perform, the skills they need to execute those roles effectively and the way new information technology is affecting these roles and skills Discuss the principal challenges managers face in today’s increasingly competitive global environment © Copyright 2004 McGraw-Hill 1–3 What Is Management? What Is Management? • Management The planning, organizing, leading, and controlling of human and other resources to achieve organizational goals effectively and efficiently • Managers The people responsible for supervising the use of an organization’s resources to meet its goals • Resources are organizational assets People Skills Knowledge Information Raw materials Machinery Financial capital © Copyright 2004 McGraw-Hill 1–4 Efficiency, Effectiveness, and Performance in an Organization Efficiency, Effectiveness, and Performance in an Organization © Copyright 2004 McGraw-Hill Figure 1.1 1–5 Organizational Performance Organizational Performance • Organizational Performance A measure of how efficiently and effectively managers are using organizational resources to satisfy customers and achieve goals • Efficiency To the things right! A measure of how well or productively resources are used to achieve a goal • Effectiveness To get the right things done! A measure of the appropriateness of the goals an organization is pursuing and the degree to which they are achieved © Copyright 2004 McGraw-Hill 1–6 Why Study Management? Why Study Management? • Proper management directly impacts improvements in the well-being of a society • Studying management helps people to understand what management is and prepares them accomplish managerial activities in their organizations • Studying management opens a path to a wellpaying job and a satisfying career © Copyright 2004 McGraw-Hill 1–7 Four Functions of Management Four Functions of Management © Copyright 2004 McGraw-Hill Figure 1.2 1–8 Managerial Functions Managerial Functions • Henri Fayol First outlined the four managerial functions in his book General Industrial Management Managers at all levels in all organizations perform each of the functions of planning, organizing, leading, and controlling © Copyright 2004 McGraw-Hill 1–9 Planning Planning • Identifying and selecting appropriate goals and courses of action for an organization The planning function determines how effective and efficient the organization is and determines the strategy of the organization • Three Steps in the Planning Process: Deciding which goals to pursue Deciding what courses of action to adopt Deciding how to allocate resources © Copyright 2004 McGraw-Hill 1–10 Relative Amount of Time That Managers Relative Amount of Time That Managers Spend on the Four Managerial Functions Spend on the Four Managerial Functions © Copyright 2004 McGraw-Hill Figure 1.4 1–17 IT and Managerial Roles and Skills IT and Managerial Roles and Skills • Information Technology (IT) is increasingly used to help managers adopt a crossdepartmental view of their organization • Managerial Role The set of specific tasks that a person is expected to perform because of the position he or she holds in the organization • Roles are defined into three role categories (as identified by Mintzberg): Interpersonal  Informational © Copyright 2004 McGraw-Hill  Decisional 1–18 Decisional Roles Decisional Roles • Roles associated with methods managers use in planning strategy and utilizing resources: Entrepreneur—deciding which new projects or programs to initiate and to invest resources in Disturbance handler—managing an unexpected event or crisis Resource allocator—assigning resources between functions and divisions, setting the budgets of lower managers Negotiator—reaching agreements between other managers, unions, customers, or shareholders © Copyright 2004 McGraw-Hill 1–19 Informational Roles Informational Roles • Roles associated with the tasks needed to obtain and transmit information in the process of managing the organization: Monitor—analyzing information from both the internal and external environment Disseminator—transmitting information to influence the attitudes and behavior of employees Spokesperson—using information to positively influence the way people in and out of the organization respond to it © Copyright 2004 McGraw-Hill 1–20 Interpersonal Roles Interpersonal Roles • Roles that managers assume to provide direction and supervision to both employees and the organization as a whole: Figurehead—symbolizing the organization’s mission and what it is seeking to achieve Leader—training, counseling, and mentoring high employee performance Liaison—linking and coordinating the activities of people and groups both inside and outside the organization/department © Copyright 2004 McGraw-Hill 1–21 Being a Manager Being a Manager High Variety High Variety Fragmentation Fragmentation Managerial Managerial Problems Problems Brevity Brevity Compensation to be a manager © Copyright 2004 McGraw-Hill 1–22 Managerial Skills Managerial Skills • Conceptual Skills What should be the right thing? The ability to analyze and diagnose a situation and distinguish between cause and effect • Human Skills The ability to understand, alter, lead, and control the behavior of other individuals and groups • Technical Skills How can we better? The specific knowledge and techniques required to perform an organizational role © Copyright 2004 McGraw-Hill 1–23 Skill Types Needed by Managerial Level Skill Types Needed by Managerial Level © Copyright 2004 McGraw-Hill 1–24 Challenges for Management Challenges for Management in a Global Environment in a Global Environment • Increasing Number of Global Organizations • Building a Competitive Advantage • Maintaining Ethical Standards • Managing a Diverse Workforce • Utilizing IT and E-commerce © Copyright 2004 McGraw-Hill 1–25 Building a Competitive Advantage Building a Competitive Advantage • Increasing Efficiency Reducing the quantity of resources used to produce goods and services • Increasing Quality Introducing Total Quality Management (TQM) to improve quality • Increasing Speed, Flexibility, and Innovation Adapting to bring new products to market faster • Increasing Responsiveness to Customers Empowering employees to deal with customers © Copyright 2004 McGraw-Hill 1–26 Building Blocks of Competitive Advantage Building Blocks of Competitive Advantage © Copyright 2004 McGraw-Hill Figure 1.5 1–27 Maintaining Ethical Standards Maintaining Ethical Standards • Factors Influencing Behaviors: External pressures from stockholders/stakeholders for increased organizational financial performance Internal pressures from top management to lowerlevel managers to increase the organization’s competitive performance and profitability Societal, cultural, and environment demands on the organization Hurt somebody unintendedly vs illegally © Copyright 2004 McGraw-Hill 1–28 Managing a Diverse Workforce Managing a Diverse Workforce • The Increasing Diversity of the Workforce • Non-Discriminatory Employment Practices • Performance-Enhancing Benefits of a Diverse Workforce The opportunities for specialization © Copyright 2004 McGraw-Hill 1–29 Utilizing Information Technology (IT) Utilizing Information Technology (IT) and E-commerce and E-commerce • Benefits of IT and E-commerce Makes more and better information about the organization available to outsiders Empowers employees at all organizational levels Helps managers carry out their roles more effectively and efficiently Increases awareness of competitive opportunities Makes the organization more responsive to its customers © Copyright 2004 McGraw-Hill 1–30 Readings on the historical management gurus Readings on the historical management gurus • Appendix A of chapter • Brief the management thoughts © Copyright 2004 McGraw-Hill 1–31