YIELD = IS THE MEASURE OF THE

RATIO OF THE OUTPUT OVER

OUTPUT PLUS REJECTS

YIELD = OUTPUT /
OUTPUT + REJECT

The Functions of Management

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 11

Managerial Functions
Planning

Organizing

Leading

Controlling

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Excellence in Business, 3e

Chapter 6 - 12

Roles of Management
Interpersonal
Informational
Decisional
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Excellence in Business, 3e

Chapter 6 - 13

The Planning Function

Develop Strategies
for Success
Set Goals
and Objectives

Develop
Action Plans
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Excellence in Business, 3e

Chapter 6 - 14

Strategic Planning Process

1
Develop
A Vision

7
Develop
Action Plans

2
Write Mission
Statement

6
Set Goals
And Objectives

3
Perform
SWOT Analysis

5
Analyze
Competition
Prentice Hall, 2007

4
Develop
Forecasts
Excellence in Business, 3e

Chapter 6 - 15

Clarity of Vision
Development
Communication

Execution
Modification
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Excellence in Business, 3e

Chapter 6 - 16

Mission Statement
Objectives

Goals

Philosophies

Product
or Service

Primary
Market

Survival, Growth,
Profitability

Managerial
Philosophy

Level of
Quality

Social
Responsibility

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Excellence in Business, 3e

Chapter 6 - 17

Strengths

Weaknesses

The framework is credited to Albert Humphrey,

who tested the approach in 1960s and 1970s at the Stanford Research Institute (SRI).
Developed for business and based on data from Fortune 500 companies,
the SWOT analysis has been
adopted by organizations of all types as an aid to making
decisions.

SWOT
Analysis

Opportunities
Prentice Hall, 2007

Threats
Excellence in Business, 3e

Chapter 6 - 18

SWOT ANALYSIS
As its name states, a SWOT analysis examines four elements:

Strengths - internal attributes and resources that

support a successful outcome.

Weaknesses - internal attributes resources that work

against a successful outcome.
Opportunities - external factors the project can
capitalize on or use to its advantage.
Threats - external factors that could jeopardize the
project.

Managerial Forecasts
Qualitative
Forecasting

Intuitive
Judgments

Prentice Hall, 2007

Quantitative
Forecasting

Consumer
Research

Historical
Data

Excellence in Business, 3e

Statistical
Computations

Chapter 6 - 20

Competitive Analysis
Differentiation
Cost Leadership
Focus
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Excellence in Business, 3e

Chapter 6 - 21

Company Goals and

Objectives
Goals

Objectives

Broad, Long-Range
Target or Aim

Specific, Short-Range
Target or Aim

Sets Standards

Guides Activity

Boosts Motivation

Clarifies Expectations
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Excellence in Business, 3e

Chapter 6 - 22

One-Three
Years

Middle
Managers

Operational Plans

First-Line
Managers

Time Frame

Management

Tactical Plans

Less Than
a Year
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Excellence in Business, 3e

Chapter 6 - 23

Crisis Management
Minimize
Damage

Maintain
Operations

Contingency
Plans

Open
Communication

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Excellence in Business, 3e

Chapter 6 - 24

The Organizing Function

Employee Activities
Facilities and Equipment
Decision Making
Supervision
Resource Distribution
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Excellence in Business, 3e

Chapter 6 - 25

The Management Pyramid

Top
Managers

Middle
Managers

First-line
Managers

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Excellence in Business, 3e

Chapter 6 - 26

The Management Pyramid

President, CEO, VP
Top
Managers

Make long-range plans

Establish policies
Represent the company

Middle
Managers

First-line
Managers

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 27

The Management Pyramid

Controller, Marketing
Manager, Sales Manager

Top
Managers

Implement goals
Make decisions
Direct first-line managers

Middle
Managers

First-line
Managers

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Excellence in Business, 3e

Chapter 6 - 28

The Management Pyramid

Office Manager,
Supervisor, Foreman,
Department Head

Top
Managers

Implement plans
Oversee workers
Assist middle managers

Middle
Managers

First-line
Managers

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Excellence in Business, 3e

Chapter 6 - 29

The Leading Function

Managers

Leaders

Position Power

Personal Power

Rational

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Intellectual

Practical

Inspirational

Excellence in Business, 3e

Visionary

Emotional

Chapter 6 - 30

Leadership Qualities
Intelligence Quotient (IQ)
Emotional Quotient (EQ)
Social Quotient (SQ)
Change Quotient (CQ)
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Excellence in Business, 3e

Chapter 6 - 31

Intelligence Quotient (IQ)

Life-long learning is widely regarded as the increase in the intellectual
level IQ of everyone wishing to improve ones mind, professional
expertise, and position in life. IQ contributes significantly to the
personal wisdom one attains throughout the maturing process.
Henri Bergson, in his book Creative Evolution reminds us: To exist is
to change, to change is to mature, to mature is to go on creating
oneself endlessly. Continuing education is a never-ending process in
raising ones intellectual level, i.e. IQ.
Life-long learning is widely regarded as the increase in the intellectual
level IQ of everyone wishing to improve ones mind, professional
expertise, and position in life. IQ contributes significantly to the
personal wisdom one attains throughout the maturing process.
Enrolling in classes of higher learning, obtaining a second degree,
technical expertise improvement classes.
Research intellectual topics such as philosophy, religion, symbolism,
leadership, psychology.

Emotional Intelligence (EQ)

Daniel Goleman, writing in What Makes A Leader, says that his
findings have shown that the most effective leaders all have a
high degree of Emotional Intelligence (EQ).
The Center for Creative Leadership (CCL) says EQ is associated
with better performance in nine different areas of leadership
and management. Golemans research clearly shows that EQ is
the sine qua non absolute requirement of leadership.
Learn principles and practices for improvements in SelfAwareness and Self-Management: self-confidence; self-control;
adaptability; initiative.
Becoming more socially: empathetic; service orientation to
others and the organization.
Relationship Management: inspirational leadership practices;
change management; conflict resolution skills; teamwork
building techniques.

https://youtu.be/pFkRbUKy19g

It measures how much and how well your entire company (or association, or
team, or batallion, or garage band, or whatever) is changing, not how well a
particular person is doing.

Spiritual Intelligence (SQ)

SQ may be defined as: The ability to behave with
wisdom and compassion, while maintaining inner and
outer peace, regardless of the situation. Wisdom and
compassion being the pillars of SQ.
Deeper understanding of ones own world view, life purpose, value hierarchy
and controlling personal ego to consider the higher self.
Self-mastery of ones spiritual growth, living your purpose, values and vision,
sustaining faith in and seeking guidance from GOD.
Universal awareness of world view of others, limitations and power of human
perception, awareness of spiritual laws and transcendental oneness
Social Mastery/Spiritual Presence: wise and effective mentor of spiritual
principles; leadership change agent; making

wise and
compassionate decisions; and being aligned with the
ebb and flow of life.

Leadership Styles
Autocratic

Democratic

Laissez-Faire

Contingency

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Excellence in Business, 3e

Chapter 6 - 41

Leader Behavior Continuum

Management-Centered
Leadership

Employee-Centered
Leadership

Authority
of Manager

Freedom
For Workers

Manager
Makes
Decision

Manager
Sells
Decision

Prentice Hall, 2007

Manager
Presents
Ideas

Manager
Makes
Tentative
Decision
Excellence in Business, 3e

Manager
Presents
Problem

Manager
Sets
Decision
Limits

Employees
Make
Decision

Chapter 6 - 42

Types of Leaders
Transactional

Transformational

Meeting Established Goals

Inspiring Employees

Clarifying Organizational Roles

Finding Creative Solutions

Securing Correct Resources

Promoting Success

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 43

Additional
Leadership Functions
Coaching

Mentoring

Meeting with employees

Guiding employees

Discussing problems

Explaining office politics

Offering suggestions

Serving as role models

Encouraging solutions

Providing valuable advice

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 44

Managing Change

Present
Situation

Identify What
Needs to Change
Prentice Hall, 2007

Process
of Change

Identify Forces For

and Against Change

Select the Best

Approach

Excellence in Business, 3e

New
Situation

Reinforce and
Monitor Behavior
Chapter 6 - 45

Organizational Culture
Attitudes
About Work

Employee
Interactions

Prentice Hall, 2007

Appropriate
Attire

Communication
Patterns

Excellence in Business, 3e

Business
Conduct

Chapter 6 - 46

The Controlling Function

Monitoring Progress

Resetting The Course

Correcting Deviations
Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 47

The Quality Control Cycle

Set Strategic
Goals

1. Set
Standards

2. Measure
Performance

Reevaluate
Standards

Correct
Performance

4. Inadequate
Take Action

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3. Compare
To Standard

Excellence in Business, 3e

4. Adequate
No Action

Chapter 6 - 48

Usually, the numerator is the total $ value of all outputs.

The denominator is total $ value of all inputs.

PRODUCTION METRICS - ASSEMBLY

Measures of Productivity

Single-factor
measures

All-factors
measure

Output
Labor

Output
Machine

Output
Capital

Output
Energy

Output
All inputs

51

Single Factor

Single-factor
measures

Output
Labor

Output
Machine

Output
Capital

Output
Energy

If we produce only one product, the numerator can be either the total
units of the product or the total $ value of the product. If we produce
several products, the numerator is the total $ value of all products.
The denominator can be the units of input or the total $ value of
input.

52

Example: Single Factor Productivity

10,000 Units Produced

Sold for $10/unit
500 labor hours
Labor rate: $9/hr

What is the
labor productivity?

53

Example: Labor Productivity

10,000 units / 500hrs = 20 units/hr
(10,000 units * $10/unit) / 500hrs = $200/hr
10,000 units / (500hrs * $9/hr) = 2.2 unit/$
(10,000 units * $10/unit) / (500hrs * $9/hr) = 22.22
The last one is unit-less
54

Some Single Factor Measurements

Labor Productivity
Quantity (or value) of output / labor hrs

Quantity (or value) of output / shift

Machine Productivity
Quantity (or value) of output / machine hrs

Energy Productivity
Quantity (or value of output) / kwh

Capital Productivity

Quantity (or value) of output / value of input

55

All Factors
All-factors
measure

Goods or Services produced

All inputs used to produce them

If we produce only one product, the numerator can be either the total
units of product or total $ value of the product.
If we produce several products, the numerator is the total
$ value of all products.
Usually, the numerator is the total $ value of all outputs.

The denominator is total $ value of all inputs.

56

Example
10,000 Units Produced
Sold for $10/unit
500 labor hours
Labor rate: $9/hr
Cost of raw material: $30,000
Overhead: $15,500
57

Example : All-Factor Productivity

AFP =

Output
Labor + Materials + Overhead

AFP =

(10,000 units) * ($10)

(500)*($9) + ($30,000) + ($15,500)

AFP = 2.0

58

PPHK
PRODUCTION PIECES PER MAN-HOUR

Output
PPHK
(headcount * hrs) + O.T.
Note:
The higher the computed value, the higher the productivity.

PPHK
PRODUCTION PIECES PER MAN-HOUR
OUTPUT PER WEEK:

49,900,000UNITS

57,000,000UNITS

HEADCOUNT:

425

376

O.T. HOURS PER WEEK:

438

180

HOURS PER WEEK:

48

48

PPHK:

2,884.08

3,338.24

PPHK Comparative Data

Q3 08 and Q3 09
4,000

Q3 2009

Q3 2008

15.74% PPHK
improvement

3,500

3,000

2,500
Volume :
49.9 M
Headcount : 425
O.T.:
438
% O.T.:
2.45%
PPHK:
2,884

2,000

1,500

Volume :
Headcount :
O.T.:
% O.T.:
PPHK:

57.0 M
376
180
1.0%
3,338

1,000

500

Q3 '08

Q4 '08

Q1 '09

Q2 '09

Q3 '09

Assy PPHK

3,018

Stretched

3,200

Q4 '09

'

2,720

2,140

2,333

2,863

3,200

3,200

3,200

T arget

2,900

2,900

2,900

T hreshold

2,600

2,600

2,600

Q4 '10

3,200

3,200

3,200

3,200

2,900

2,900

2,900

2,900

2,900

2,600

2,600

2,600

2,600

2,600

3,560

Management
Skills

Interpersonal
Technical
Administrative
Conceptual
Decision-Making
Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 62

The Decision-Making Process

Recognize and
Define the Situation

Identify Options

Analyze Options

Select the Best

Option

Implement
the Decision

Monitor and
Evaluate the Results

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 6 - 63