Management: A Global and Entrepreneurial Perspective by Weihrich, Cannice, and Koontz

MANAGEMENT:
A GLOBAL AND ENTREPRENEURIAL PERSPECTIVE

by Weihrich, Cannice, and Koontz
Chapter
Management: Science, Theory, and Practice
© 2008 Weihrich & Cannice Chapter 1. Management: Science, Theory, and Practice 1
After studying this chapter, you should be
able to:
1. Explain the nature and purpose of management

2. Understand that management applies to all kinds of organization and to
managers at all organizational levels
3. Recognize that the aim of all managers is to create a "surplus“
4. Identify the trends in information technology and globalization
5. Explain the concepts of productivity, effectiveness, and efficiency
6. Describe the evolution of management and some recent contributions
to management thought
7. Describe the various approaches to management
8. Show how the management process approach draws from other
approaches
9. Realize the managing requires a systems approach
10. Define the managerial functions of planning, organizing, staffing,
leading, and controlling
11. Understand how the book is organized
© 2008 Weihrich and Cannice Chapter 1. Management: Science, Theory, and Practice 2
Definition of Management:
Its Nature and Purpose
• Management is the process of

designing and maintaining an
environment in which individuals,
working together in groups, efficiently
accomplish selected aims.
The Functions of Management
• The five managerial functions around

which managerial knowledge are
organized: planning, organizing,
staffing, leading, controlling.
The External Environment
• The external elements that affect operations

can be grouped into:
– Economic factors
– Technological factors
– Social factors
– Ecological factors
– Political/legal factors
– Ethical factors
Enterprise
• A business, government agency,

hospital, university, or any other type of
organization.
Managerial Functions at Different
Organizational Levels
• All managers carry out managerial

functions, but the time spent for each
function may differ.
Fig. 1-1 Time Spent in Carrying Out
Managerial Functions
Managerial Skills and the Organizational
Hierarchy
The four skills required of

administrators:
• Technical skills
• Human skills
• Conceptual skills
• Design skills
Fig. 1-2 Skills and Management Levels
The Goals of All Managers and Organizations
• The aim of all managers should be to

create a surplus. Thus, managers must
establish an environment in which
people can accomplish group goals with
the least amount of time, money,
materials, and personal dissatisfaction.
Characteristics of Excellent
Companies (Peters & Waterman)
• Oriented toward action
• Learned about the needs of their customers
• Promoted managerial autonomy and entrepreneurship
• Achieved productivity by paying close attention to the
needs of their people
• Driven by a company philosophy often based on the
values of their leaders
• Focused on the business they knew best
• Had a simple organization structure with a lean staff
• Were centralized as well as decentralized, depending on
appropriateness
The Most Admired Companies in America
listed in Fortune’s March 6, 2006 issue were
• 1. General Electric
• 2. FedEx
• 3. Southwest Airlines
• 4. Proctor & Gamble
• 5. Starbucks
• 6. Johnson & Johnson
• 7. Berkshire Hathaway
• 8. Dell
• 9. Toyota Motor
• 10. Microsoft.
Adapting to Changes in
the 21st Century
• To be successful in the 21st Century,

companies must take advantage of the
new information technology—especially
the Internet—and globalization.
• M-commerce is mobile or wireless
commerce.
Entrepreneurship
• Entrepreneurship is a creative process

that is centered in the notion of
identifying market opportunities and
unmet needs. It is building solutions that
meet these needs and bring value to
customers
Five Fast Growing Technology
Companies in America, 2006
• 1. Celgene (Medical)
• 2. Red Hat (Software)
• 3. Apple Computer (Electronics)
• 4. SanDisk (Electronics)
• 5. ValueClick (Business Services)
Productivity
• The output-input ratio within a time

period with due consideration for quality.
Definitions of Effectiveness
and Efficiency
• Productivity implies effectiveness and

efficiency in individual and
organizational performance.
• Effectiveness is the achievement of
objectives.
• Efficiency is the achievement of the
ends with the least amount of resources
(time, money, etc.).
Managing: Science or Art?
• Managing as practice is an art; the

organized knowledge underlying the
practice may be referred to as a
science.
The Evolution of Management Thought
& Patterns of Management Analysis
• Frederick Taylor and Scientific

Management
• Fayol, the Father of Modern Operational
Management Theory
• Elton Mayo and F. Roethlisberger and
the Hawthorne Studies
• Recent Contributors to Management
Thought, including Peter Drucker
Taylor's Principles of
Scientific Management
1. Replacing rules of thumb with science (organized

knowledge)
2. Obtaining harmony in group action, rather than
discord
3. Achieving cooperation of human beings, rather
than chaotic individualism
4. Working for maximum output, rather than restricted
output
5. Developing all workers to the fullest extent possible
for their own and their company's highest
prosperity
Fayol, the Father of Modern
Management Theory
• Authority and responsibility. Authority is a

combination of official and personal factors.
• Unity of Command. Employees should
receive orders from one superior only.
• Scalar Chain. A "chain of superiors" from the
highest to the lowest ranks should be
short‑circuited when to follow it scrupulously
would be detrimental.
• Esprit de Corps. This is the principle that "in
union there is strength.”
Elton Mayo and F. Roethlisberger and
the Hawthorne Studies.
• In general, the improvement in productivity

was due to such social factors as morale,
satisfactory interrelationships between
members of a work group (a "sense of
belonging"), and effective management—a
kind of managing that would understand
human behavior, especially group behavior,
and serve it through such interpersonal skills
as motivating, counseling, leading, and
communicating.
Recent Contributors to Management
Thought
• Peter F. Drucker
• Keith Davis
• W. Edwards Deming
• Joseph M. Juran
• Laurence Peter
• William Ouchi
• Thomas Peters and Robert Waterman
The Managerial Roles Approach
(Mintzberg)
• 3 interpersonal roles
• 3 informational roles
• 4 decision roles
Patterns of Management Analysis: A
Management Theory Jungle?
1. The empirical, or case, approach

2. The managerial roles approach
3. The contingency, or situational, approach
4. The mathematical, or "management
science," approach
5. The decision theory approach
6. The reengineering approach
7. The systems approach
Patterns of Management Analysis —
cont.
8. The sociotechnical systems approach

9. The cooperative social systems approach
10. The group behavior approach
11. The interpersonal behavior approach
12. McKinsey's 7‑S framework
13. The total quality management approach
14. The management process, or operational,
approach
Fig. 1-4 The Management Process, or
Operational Approach
The Management Process, or
Operational, Approach
• This approach draws together the

pertinent knowledge of management by
relating it to the managerial job—what
managers do.
• It tries to integrate the concepts,
principles, and techniques that underlie
the task of managing.
Fig. 1-5 A Basic Input-Output Model
The Five Managerial Functions
• Planning
• Organizing
• Staffing
• Leading
• Controlling
Definition of Planning
• Selecting missions and objectives and

the actions to achieve them, which
requires decision making.
Definition of Organizing
• Organizing involves establishing an

intentional structure of roles for people
to fill in an organization.
Definition of Staffing
• Staffing involves filling, and keeping

filled, the positions in the organization
structure.
Definition of Leading
• Leading is influencing people so that

they will contribute to organization and
group goals.
Definition of Controlling
• Controlling is measuring and correcting

individual and organizational
performance to ensure that events
conform to plans
The Systems Model of Management
and Organization of This Book
• Discussion of Figure 1-6 in the textbook

Management: A Global and
Entrepreneurial Perspective, by
Weihrich, Cannice and Koontz
Fig. 1-6 Systems Approach to Management
KEY IDEAS AND CONCEPTS FOR REVIEW
• Management • Contributors to scientific

• Managerial functions management
• Managerial skills in the • Fayol’s operational
organizational hierarchy management theory
• The goal of all managers • Mayo and Roethlisberger
• Characteristics of excellent and • Recent contributors to
most admired companies management thought
• Three major trends: Advances in • Management theory jungle
technology, globalization, and • Managerial roles approach
entrepreneurship • Management process, or
• Productivity, effectiveness, and operational, approach
efficiency • Systems approach to the
• Managing: science or art? management process
• Major contributors to • Five managerial functions
management thought

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MANAGEMENT:

A GLOBAL AND ENTREPRENEURIAL PERSPECTIVE

Management: Science, Theory, and Practice

1. Explain the nature and purpose of management

• Management is the process of

• The five managerial functions around

• The external elements that affect operations

• A business, government agency,

• All managers carry out managerial

The four skills required of

• The aim of all managers should be to

• To be successful in the 21st Century,

• Entrepreneurship is a creative process

• The output-input ratio within a time

• Productivity implies effectiveness and

• Managing as practice is an art; the

• Frederick Taylor and Scientific

1. Replacing rules of thumb with science (organized

• Authority and responsibility. Authority is a

• In general, the improvement in productivity

1. The empirical, or case, approach

8. The sociotechnical systems approach

• This approach draws together the

• Selecting missions and objectives and

• Organizing involves establishing an

• Staffing involves filling, and keeping

• Leading is influencing people so that

• Controlling is measuring and correcting

• Discussion of Figure 1-6 in the textbook

• Management • Contributors to scientific

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