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*Chapter Seven

Management and

Leadership

Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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*Managers’ Roles Are Evolving

• Management is the process used to accomplish organizational goals through planning, organizing, leading and controlling people and other organizational resources.

TODAY’S MANAGEMENTLG1

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*Four Functionsof Management

1. Planning

2. Organizing

3. Leading

4. Controlling

Study figure 7.1

FOUR FUNCTIONS of MANAGEMENT LG2

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*Planning & Decision Making

• Vision -- More than a goal, it’s a broad explanation of why the organization exists and where it’s trying to go. Gives a sense of purpose (future)

• A mission statement outlines the organization’s fundamental purposes. (present)

• Organization’s self-concept• Its philosophy• Customer needs• Social responsibility• Nature of product or service

SHARING the VISION

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• Goals are the broad, long term accomplishments an organization wishes to attain.

• Objectives are specific, short term statements detailing how to achieve the organization’s goals.

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*Planning & Decision Making

• What is the situation now?SWOT Analysis -- Analyzes the organization’s Strengths, Weaknesses, Opportunities and Threats.

Fig: 7.3

• How can we get to our goal from here?

- Strategic planning- Tactical planning- Operational planning- Contingency planning

PLANNING ANSWERS FUNDAMENTAL QUESTIONS LG3

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*Planning & Decision Making

• 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.

STRATEGIC and TACTICAL PLANNING LG3

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*Planning & Decision Making

• Operational Planning -- The process of setting work standards and schedules necessary to implement the company’s tactical objectives.

OPERATIONAL and CONTINGENCY PLANNING

LG3

• Contingency Planning -- The process of preparing alternative courses of action the firm can use if its primary plans don’t work out.

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*Planning & Decision Making

LG3

PLANNING FUNCTIONS

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*Decision Making: Finding the Best Alternative

1. Define the situation.

2. Describe and collect needed information.

3. Develop alternatives.

4. Develop agreement among those involved.

5. Decide which alternative is best.

6. Do what is indicated.(begin implementation)

7. Determine whether the decision was a good one and follow up.

RATIONAL DECISION-MAKING MODEL (7D’s) LG3

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*Decision Making: Finding the Best Alternative

Problem Solving: less formal than decision making, calls for quicker action to resolve everyday issues with less info. available

1. Brainstorming - coming up with as many solutions possible in a short period of time with no censoring of ideas.

2. Another technique is called PMI, or listing all the pluses for a solution in one column, all the minuses in another, and the implications in a third. The idea is to make sure the pluses exceed the minuses.

Problem SolvingLG3

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*Organizing: Creating a Unified System

• Organization Chart -- A visual device that shows relationships among people and divides the organization’s work; it shows who reports to whom.

ORGANIZATIONAL CHARTSLG4

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Copyright © 2005 Prentice Hall, Inc. All rights reserved. 1–14

Classifying Managers*• 1. First-line Managers also called supervisors

– Are at the lowest level of management and manage the work of non-managerial employees e.g. Shift managers, district managers, etc.

• 2. Middle Managers– Manage the work of first-line managers e.g. Regional manager,

project leader, store manager, etc.

• 3. Top Managers– Are responsible for making organization-wide decisions and

establishing plans and goals that affect the entire organization e.g. Managing director, CEO, COO, President, etc.

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*Organizing: Creating a Unified System

LG4

LEVELS of MANAGEMENT

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Organizing• Skills/Tasks

– Technical- task in specific discipline– Human relation- involve

communication and motivation– Conceptual- the ability to picture

the org. as a whole

• Staffing Involves recruiting, hiring,

motivating and retaining the best people available to accomplish the company’s objectives.

Copyright © 2005 Prentice Hall, Inc. All rights reserved. 1–17

Skills Needed at Different Management Levels

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*Leading: Providing Continuous Vision and Values.

• Leaders must:- Communicate a vision and rally others around that

vision- a successful leader must influence the action of others.

- Establish corporate values.- Promote corporate ethics.- Embrace change- both effective and efficient- Stress accountability and responsibility- transparency

LEADERSHIP- LeadingLG5

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*Leadership Styles• 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. Works best when supervises doctors, engineers, professors and professionals etc.

LEADERSHIP STYLES

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LEADERSHIP STYLES- other concepts

Directing- giving explicit instructions about what to do (fast food restaurant and small retail business)

Empowerment- giving employees the authority to make a decision without consulting the manager. (high-tech firm, internet companies)

Enabling- giving workers education and tools they need to make decisions

Knowledge management- “knowledge is power”: finding the right info, keeping it accessible and known to everyone in the firm

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*Controlling: Making Sure it Works

FIVE STEPS of CONTROLLINGLG6

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A key criterion for measurement: Customer Satisfaction

• External customers include dealers, who buy products to sell to others, and ultimate customers such as you and me, who buy their products for their own personal use.

• Internal customers are individuals and units within the firm that receive services from other individuals or units. (field sales people)

• One goal today is to go beyond simply satisfying customers to “delighting” them with unexpectedly good products and services.