THE DYNAMICS NEW WORKPLACE

(NEW ECONOMY AND OLD ECONOMY)

MONSTER.COM-SMART PEOPLE CREATE THEIR OWN FUTURES

As the leading global online career site, Monster.com represents the growing field of online job
placement services available on the Web. Its founder, Jeff Taylor, describes its birth this way: "One
morning I woke up at 4 a.m., and wrote an idea down on a pad of paper I keep next to my bed. I had
this dream that I created a bulletin board called the Monster Board. That became the original name for
the company. When I got up, I went to a coffee shop, and from 5:30 a.m. until about 10:00 a.m. I
wrote the user interface for what today is Monster.com."

Media Metrix has called Monster.com the number-one destination for job seekers and one of the most
visited domains on the Internet. It hosts over 36 million job seeker accounts. Job candidates search
Monster's 800,000 job postings, some 175 million times each month. They also use Monster for
interviewing advice, company research, and even moving tips.

Monster.com represents itself as a "lifelong career network" that serves everyone from recent college
graduates all the way up to seasoned executives.

There's no complacency here, no becoming comfortable with success. The "Monster" keeps changing
as its markets develop. Monster.com provides career advice serving professional development needs;
Monstermoving.com helps in planning relocations. Monster users can research companies throughout
the United States and overseas in 20 foreign countries, including France, Germany, Singapore,
Australia, and others.

Headquartered in Maynard, Massachusetts, Monster.com is the flagship brand of the Interactive

division of TMP Worldwide Inc., one of the world's largest search and selection agencies. Its clients
include almost all the Fortune 500 companies.

Chapter 1 Learning Preview

Monster,com is a creative company with great leadership that keeps it abreast of changing times. The
purpose of Chapter 1 is to introduce you to managers and management as building blocks of all such
high-performing organizations in the dynamic new workplace. As you read, keep this purpose in mind
while checking your learning progress step-by-step in these major areas.

THE DYNAMIC NEW WORKPLACE

Study question 1 Study question 2 Study question 3 Study question 4

Study question 5

Working in the Organizations in Managers in the The Management

Learning How to
New Economy the New Workplace New Workplace Process Manage

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●Intellectual ●What is an ●What is a manager? ●Functions of ●Essential
capital organization? management managerial
skills
●Globalization ●Organization as ●Levels and types of ●Managerial ●Skill &
outcome
●Technology systems managers activities & roles assessment
●Diversity ●Organizational ●Managerial ●Managerial agendas ●Management
B/E
●Ethics performance performance and networking learning
●Careers ●Changing nature of ●Changing nature of framework
organizations managerial work
Learning check 1 Learning check 2 Learning check 3 Learning check 4 Learning
check 5

The 21st century has brought with it a new workplace, one in which everyone must adapt to a
rapidly changing society with constantly shifting demands and opportunities. Learning and speed
are in; habit and complacency are out. Organizations are fast changing, as is the nature of work
itself. The economy is global, driven by innovation and technology. Even the concept of success,
personal and organizational, is evolving as careers take new forms and organizations transform to
serve new customer expectations. These developments, say the editors of Fast Company magazine,
affect us all, offering both "unparalleled opportunity and unprecedented uncertainty." In this age of
continuous challenge, a compelling message must be heard by all of us-smart people and smart
organizations create their own futures.

In the quest for the future the best employers share an important commitment-they value people!
They offer supportive work environments that allow people's talents to be fully utilized while
providing them with both valued rewards and respect for work-life balance. In progressive
organizations, employees benefit from flexible work schedules, on-site child care, health and
fitness centers, domestic partner benefits, as well as opportunities for profit sharing, cash bonuses,
and competitive salaries. In short, the best employers are not just extremely good at attracting and
retaining talented employees. They also excel at creating a high-performance context in which
everyone's abilities are highly valued.

After studying high-performing companies, management scholars Charles O'Reilly and Jeffrey
Pfeffer conclude that success is achieved because they are better than their competitors at getting
extraordinary results from the people working for them. "These companies have won the war (or-
talent," they say, "not just by being great places to work-although they are that-but by figuring out
how to get the best out of all of their people, every day." This, in large part, is what Management 8/
e and your management course are all about. Both are designed to introduce you to the concepts,
themes, and directions that are consistent with career success and organizational leadership in
today's high-performance work settings. As you begin, let your study of management be devoted to
learning as much as you can to prepare for a career-long commitment to getting great things
accomplished through working with and valuing people.

WORKING IN THE NEW ECONOMY

Yes, we now live and work in a new economy ripe with challenging opportunities and dramatic
uncertainty. It is a networked economy in which people, institutions, and nations are increasingly
influenced by the Internet and continuing developments in information technology. The chapter
opener on Monster.com is but one example of how the Web and its vast networking capabilities are
changing our lives. The new economy is global, and the nations of the world are increasingly
interdependent. The new economy is also knowledge based, and success is forged in workplaces
continually reinvented to unlock the great potential of human intelligence. The themes of the day

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are "respect," "participation," "empowerment," "involvement," "teamwork," "self-management,"
and more.

Undoubtedly, too, the new economy is performance driven. Expectations for organizations and
their members are very high. Success must be earned in a society that demands nothing less than
the best from all its institutions. Organizations are expected to continuously excel on performance
criteria that include concerns for ethics and social responsibilities, innovativeness, and employee
development, as well as more traditional measures of profitability and investment value. When
they fail, customers, investors, and employees are quick to let them know. For individuals, there
are no guarantees of long-term employment. Jobs are increasingly earned and re-earned every day
through one's performance accomplishments. Careers are being redefined in terms of "flexibility,"
"free agency," "skill portfolios," and "entrepreneurship." Today, it takes initiative and discipline
and continuous learning to stay in charge of your own career destiny. Tomorrow's challenges are
likely to be even greater.

Just what are the challenges ahead?

INTELLECTUAL CAPITAL
The dynamic pathways into the future are evident among new bench-marks being set in and by
progressive organizations everywhere. At Herman Miller, the innovative manufacturer of designer
furniture, respect for employees is a rule of thumb. The firm's core values include the statement: "Our
greatest assets as a corporation are the gifts, talents and abilities of our employee-owners. . . . When
we as a corporation invest in developing people, we are investing in our future." Former CEO Max
DePree says, "At Herman Miller, We talk about the difference between being successful and being
exceptional. Being successful is meeting goals in a good way-being exceptional is reaching your
potential."

The point of these examples is clear. People-what they know, what they learn, and what they do with
it-are the ultimate foundations of organizational performance. They represent an intellectual capital
defined as the collective brainpower or shared knowledge of a workforce that can be used to create
value. Indeed, the ultimate elegance of the new workplace may well be its ability to combine the
talents of many people, sometimes thousands of them, to achieve unique and significant results.

This is the new age of the knowledge worker- someone whose mind is a critical asset to employers
and who adds to the intellectual capital of the organization. If you want a successful career in the new
economy, you must be willing to reach for the heights of personal competency and accomplishment.
You must be a self-starter willing to continuously learn from experience even in an environment that
grows daily more complex and challenging.

High-performance leadership values people

When Xerox needed to change or go out of business, its Board of Directors turned to an experienced
insider for leadership. Their choice was Anne Mulcahy, a company veteran who had worked her way
to the top in a 27-year career. With an undergraduate degree in English and journalism, Mulcahy
brought a charismatic and hands-on style of leadership to the struggling firm. She began by flying
around the world to personally visit Xerox employees in all locations. Her goals were to raise morale
and motivation, and refocus on future operations. Named the sixth most powerful woman in the world
by Fortune magazine, Mulcahy says: .People have to feel engaged, motivated and feel they are
making a contribution to something that is important."

GLOBALIZATION
Japanese management consultant Kenichi Ohmae suggests that the national boundaries of world
business have largely disappeared. At the very least we can say that they are fast disappearing. Who
can state with confidence where their favorite athletic shoes or the parts for their personal computer

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were manufactured? More and more products are designed in one country, while their component
parts are made in others and the assembly of the final product takes place in still another. Top
managers at Ford, IBM, Sony, and other global corporations have no real need for the word "overseas"
in everyday business vocabulary. They operate as global businesses that view themselves as
equidistant from customers and suppliers, wherever in the world they may be located.

This is part of the force of globalization, the worldwide interdependence of resource flows, product
markets, and business competition that characterizes our new economy. This process is described as
one in which "improvements in technology (especially in communications and transportation)
combine with the deregulation of markets and open borders to bring about vastly expanded flows of
people, money, goods, services, and information. In a globalized world, countries and peoples are
increasingly interconnected through the news, in travel and lifestyles, in labor markets and
employment patterns, and in business dealings. Government leaders now worry about the
competitiveness of nations just as corporate leaders worry about business competitiveness. The world
is increasingly arranged in regional economic blocs, with Asia, North and Latin America, and Europe
as key anchors, and with Africa fast emerging to claim its economic potential. Like any informed
citizen, you too must understand the forces of globalization.

TECHNOLOGY
The global economy isn't the only beneficiary of developments with new technology. Who hasn't been
affected by the Internet and the World Wide Web? For better or worse, we now live in a technology-
driven world increasingly dominated by bar codes, automatic tellers, computerized telemarketing
campaigns, electronic mail, Internet resources, electronic commerce, and more.

From the small retail store to the large multinational firm, technology is an indispensable part of
everyday operations-whether one is checking inventory, making a sales transaction, ordering supplies,
or analyzing customer preferences. And when it comes to communication in organizations,
geographical distances hardly matter anymore. Computer networking can bring together almost
anyone from anywhere in the world at the mere touch of a keyboard. In "virtual space" people hold
meetings, access common databases, share information and files, make plans, and solve problems
together-all without ever meeting face-to-face. As the pace and complexities of technological change
accelerate, the demand for knowledge workers with the skills to best utilize technology is increasing.
Computer literacy must be mastered and continuously updated as a foundation for career success.

DIVERSITY
When published by the Hudson Institute, the report Workforce 2000: Work and Workers for the 21 st
Century created an immediate stir in business circles, among government policymakers, and in the
public eye. IS It called attention to the slow growth of the American workforce, fewer younger
workers entering the labor pool, the higher average age of the workforce, more women entering the
workforce, and the increased proportions of minorities and immigrants in the workforce. A follow-up
report, Workforce 2020, focusing on diversity themes and trends, was referred to as "a wake-up call
for American workers, corporations, educators, parents and government officials."

The term workforce diversity describes the composition of a workforce in terms of differences
among the members. These differences include gender, age, race, ethnicity, religion, sexual
orientation, and ablebodiness. In the United States the legal environment (see Chapter 12) is very
strict in prohibiting the use of demographic characteristics in human resource management decisions.
And indeed, today's increasingly diverse and multicultural workforce is increasingly viewed as an
asset offering great opportunities for performance gains. By "valuing diversity" organizations can tap
a rich talent pool and help everyone work to their full potential. But what does this really mean?
According to one consultant, it should mean "enabling every member of your workforce to perform to
his or her potential." A female vice president at Avon once posed the challenge of managing diversity
this way: "consciously creating an environment where everyone has an equal shot at contributing,

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participating, and most of all advancing."

Even though progress in valuing diversity continues to be made, lingering inequalities remain in the
workplace. A study by Catalyst, a nonprofit research group focusing on corporate women, reports that
among Fortune 500 companies women held 15.7 percent of top jobs in 2002, up from 8.7 percent in
1995. There were six woman CEOs, up from 1 in 1995. That's quite an increase. But with women
comprising about 47 percent of the U.S. labor force. The figures still leave a lot of room for future
progress. In terms of wage comparisons, for each $1 earned by men, women earn 86 cents; black
women earn 64 cents and Hispanic women earn 52 cents. Catalyst also found that 66 percent of
minority women in management are dissatisfied with their career advancement opportunities.

In respect to racial diversity in the workplace, a Fortune magazine article once concluded: "The good
news is, there's plenty of progress for companies and employees to talk about. . . But what often
doesn't get said, especially in mixed-race settings, is how much remains to get done." A recent study
revealed, for example, that when resumes are sent to potential employers, those with white-sounding
first names, like Brett, received 50 percent mere responses than those with black-sounding first names,
such as Kareem. The fact that these resumes were created with equal credentials reveals once again
that diversity bias can still be a limiting factor in too many work settings. Prejudice, or the holding of
negative, irrational opinions and attitudes regarding members of diverse populations, sets the stage for
bias. It becomes active discrimination when minority members are unfairly treated and denied the
full benefits of organizational membership. A subtle form of discrimination is called the glass ceiling
effect, an invisible barrier or "ceiling" that prevents women and minorities from rising above a certain
level of organizational responsibility. Scholar Judith Rosener suggests that the organization's loss for
any discriminatory practices is "undervalued and underutilized human capital."

ETHICS
Surely you remember the recent sensational cases of ethical failures in business-WorldCom, Enron,
and Arthur Andersen, among others. In Chapter 3, ethics is defined as a code of moral principles that
sets standards of what is "good" and "right" as opposed to "bad" or "wrong" in the conduct of a person
or group. There is a lot to be concerned about in the behavior of the corporations and people behind
the scandals. Senior executives acted unethically and organizational systems tolerated actions that
enriched the few while damaging many-ranging from company employees losing retirement savings,
to stockholders whose investments lost value, to customers and society who paid the price as business
performance deteriorated.

Even though ethical failures are well publicized, there is a plethora of positive cases and ethical role
models to be studied as well. You will find in this book many examples of people and organizations
that are exemplars of ethical leadership and whose integrity is unquestioned. They meet the standards
of a new ethical reawakening that places high value on social responsibility in business and
organizational practices. The expectations include integrity and ethical leadership at all levels in an
organizations, sustainable development and protection of the natural environment, protection of
consumers through product safety and fair practices, and protection of human rights in all aspects of
society, including employment.

Society is becoming strict in requiring businesses and other social institutions to operate according to
high moral standards. Businesses by law must have boards of directors that are elected by
stockholders to represent their interests. One of the issues raised by the rash of business ethics failures
is the role of corporate governance, the active oversight of management decisions and company
actions by boards of directors. Many argue that corporate governance failed in cases like Enron and
Andersen. The result is more emphasis today on restoring the strength of corporate governance. The
expectation is that boards will hold management accountable for ethical and socially responsible
behavior by the businesses they are hired to lead. Consider, for example, the ethical framework set by
this statement from the credo of Johnson & Johnson:

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We are responsible to the communities in which we live and work and to the world community as well.
We must be good citizens-support good works and charities and bear our fair share of taxes. We must
encourage civic improvements and better health and education. We must maintain in good order the
property we are privileged to use, protecting the environment and natural resources.

Nonprofit organizations rich in opportunities

"Get Out. Do Good." So reads the slogan of VolunteerMatch, self-described on its website as "the
nonprofit, online service that helps interested volunteers get involved with community service
organizations throughout the United States." In anyone's career it is important to remember that not all
work is for-pay work; not all job satisfaction comes from full-time employment. Nonprofit
organizations, from the Red Cross to Goodwill Industries to many others, are essential to the life of
our communities and society at large. All depend on volunteers to make their services possible.
VolunteerMatch has now handled over 1 million volunteer referrals and continues to grow in its
aspiration to partner volunteer skills with the needs of non profits.

CAREERS
The career implications of the new economy and the challenges of change make personal initiative
and self-renewal hallmarks of the day. British scholar Charles Handy suggests the analogy of the
Irish shamrock to describe and understand the new employment patterns characteristic of this
dynamic environment. Each of a shamrock's three leaves has a different career implication. In one
leaf are the core workers. These full-time employees pursue traditional career paths. With success
and the maintenance of critical skills, they can advance within the organization and may remain
employed for a long time. In the second leaf are contract workers. They perform specific tasks as
needed by the organization and are compensated on a fee-for-services basis rather than by a
continuing wage or salary. They sell a skill or service and contract with many different employers
over time. In the third leaf are part-time workers hired only as needed and for only the number of
hours needed. Employers expand and reduce their part-time staffs as business needs rise and fall.
Part-time work can be a training ground or point of entry to the core when openings are available.

You must be prepared to prosper in any of the shamrock's three leaves. The typical career of the 21 st
century won't be uniformly full-time and limited to a single large employer. It is more likely to unfold
opportunistically and involve several employment options over time. Not only must you be prepared
to change jobs and employers over time, but your skills must be portable and always of current value
in the employment markets. Skills aren't gained once and then forgotten; they must be carefully
maintained and upgraded all the time. One career consultant describes this career scenario with the
analogy of a surfer: "You're always moving. You can expect to fall into the water any number of times,
and you have to get back up to catch the next wave." Handy's advice is that you maintain a "portfolio
of skills" that are always up-to-date and valuable to potential employers.

ORGANIZATIONS IN THE NEW WORKPLACE

The new world of work is closely tied to the connectivity made possible by information technology.
Management consultant Tom Peters describes it this way:

In the next few years, whether at a tiny company or behemoth, we will be

working with an eclectic mix of contract teammates from around the globe,
many of whom we'll never meet face-to-face. Every project will call for a
new team, composed of specially tailored skills. . . . Every player on this team
will be evaluated-pass-by-pass, at-bat by at-bat, for the quality and
uniqueness and timeliness and passion of her or his contribution.

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Organizations in the new workplace are challenging settings, but exciting for their great opportunities
and possibilities. Whether large or small, business or nonprofit, each should make real and positive
contributions to society. Everyone has a stake in making sure that they perform up to expectations,
including how well they serve as a principal source of careers and economic livelihood. In his article
"The Company of the Future," Robert Reich says: "Everybody works for somebody or something-be it
a board of directors, a pension fund, a venture capitalist, or a traditional boss. Sooner or later you're
going to have to decide who you want to work for." In order to make good employment choices and
perform well in a career, you must have a fundamental understanding of the nature of organizations in
the new workplace. Manager's Notepad 1.1 provides a first look at some of the critical survival skills
that you should acquire to work well in the organizations of today . . . and tomorrow.

Critical survival skills for the new workplace (Manager's Notepad 1.1)
● Mastery: You need be good at something; you need to be able to contribute something of
value to your employer.
● Contacts: You need to know people; links with peers and others within and outside the
organization are essential to get things done.
● Entrepreneurship: You must act as if you are running your own business, spotting ideas
and opportunities, and stepping out to embrace them.
● Love of technology: You have to embrace technology; you don't have to be a technician,
but you must be willing and able to fully utilize IT.
● Marketing: You need to be able to communicate your successes and progress, both yours
personally and those of your work group.
● Passion for renewal: You need to be continuously learning and changing, always
updating yourself to best meet future demands.

WHAT IS AN ORGANIZATION ?
An organization is a collection of people working together to achieve a common purpose. It is a
unique social phenomenon that enables its members to perform tasks far beyond the reach of
individual accomplishment. This description applies to organizations of all sizes and types, from large
corporations, to the small businesses that make up the life of any community, to nonprofit
organizations such as schools, government agencies, and community hospitals.

All organizations share a broad purpsose-providing useful goods or services. Each one should return
value to society and satisfy customers' needs in order to justify its continued existence. A clear sense
of purpose that is tied to "quality products" and "customer satisfaction" is an important source of
organizational strength and performance advantage. At Medtronics, a large Minnesota-based medical
products company, for example, employees are noted for innovation and their commitment to a clear
and singular corporate mission - helping sick people get well. The sense of common purpose centers
attention and focuses their collective talents on accomplishing a compelling goal: improving the
health and well-being of those who use Medtronics products.

ORGANIZATIONS AS SYSTEMS
Organizations are systems composed of interrelated parts that function together to achieve a common
purpose. They are open systems that interact with their environments in the continual process of
transforming resource inputs into product outputs in the form of finished goods and/or services. As
shown in Figure 1.1, the external environment is a critical element in the open-systems view of
organizations. It is both a supplier of resources and the source of customers. Feedback from the
environment tells an organization how well it is doing. Without customer willingness to use the
organization's products, it is difficult to operate or stay in business over the long run. The recent

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bankruptcies of Kmart, World Com, and Andersen give stark testimony to this fact of the marketplace:
without customers, a business can't survive.

ORGANIZATIONAL PERFORMANCE
For an organization to perform well, resources must be well utilized and customers well served. The
notion of value creation is very important in this context. If operations add value to the original cost of
resource inputs, then (1) a business organization can earn a profit-that is, sell a product for more than
the cost of making it (e.g., fast-food restaurant meals), or (2) a nonprofit organization can add wealth
to society-that is, provide a public service that is worth more than its cost (e.g., fire protection in a
community). Value is created when an organization's resources are utilized in the right way, at the
right time, and at minimum cost to create for customers high-quality goods and services.

The best organizations utilize a variety of performance measures. On the customer side, high-
performing firms measure customer satisfaction and loyalty, as well as market share. On the employee
side, they measure retention, career development, job satisfaction, and task performance. A common
measure of overall performance is productivity, the quantity and quality of work performance,
relative to resources used. Productivity can be measured at the individual and group as well as
organizational levels.

Figure 1.2 links productivity with two terms commonly used in management, effectiveness and
efficiency. Performance effectiveness is an. output measure of task or goal accomplishment. If you
are working in the manufacturing area of a computer firm, for example, performance effectiveness
may mean that you meet a daily production target in terms of the quantity and quality of keyboards
assembled. By so doing, you help the company as a whole to maintain its production schedule and
meet customer demands for timely delivery and high-quality products.

Performance efficiency is a measure of the resource costs associated with goal accomplishment. Cost

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of labor is a common efficiency measure. Others include equipment utilization, facilities maintenance,
and supplies or materials expenses. Returning to the example of computer assembly, the most efficient
production is accomplished at a minimum cost in materials and labor. If you were producing fewer
computer keyboards in a day than you were capable of, this amounts to inefficiency. Likewise, if you
made a lot of mistakes or wasted materials in the assembly process, this is also inefficient work.

CHANGING NATURE OF ORGANIZATIONS

Change is a continuing theme of this book, and organizations are certainly undergoing dramatic
changes today. Among the many trends in the new workplace, the following organizational
transitions are important to your study of management:
● Belief in human capital: Demands of the new economy place premiums on high-
involvement and participatory work settings that rally the knowledge, experience, and
commitment of all members.
● Demise of "command-and-control": Traditional hierarchical structures with "do as I
say" bosses are proving too slow, conservative, and costly to do well in today's
competitive environments.
● Emphasis on teamwork: Today's organizations are less vertical and more horizontal in
focus; they are increasingly driven by teamwork that pools talents for creative problem solving.
● Pre-eminence of technology: New opportunities appear with each new development in
computer and information technology; they continually change the way organizations
operate and how people work.
● Embrace of networking: Organizations are networked for intense real time
communication and coordination, internally among parts and externally with partners,
contractors, suppliers, and customers.
● New workforce expectations: A new generation of workers brings to the workplace less
tolerance for hierarchy, more informality, and more attention to performance merit than to
status and seniority.
● Concern for work-life balance: As society increases in complexity, workers are forcing
organizations to pay more attention to balance in the often-conflicting demands of work and
personal affairs.
● Focus on speed: Everything moves fast today; in business those who get products to
market first have an advantage, and in any organization work is expected to be both well done
and timely.

There are many force driving these changes in organizations. Key among them is unrelenting demand
for quality products and services. Organizations that fail to listen to their customers and fail to deliver
quality goods and services at reasonable prices will be left struggling in a highly competitive
environment. References will be made throughout this book to the concept of total quality
management (TQM)--managing with an organization-wide commitment to continuous improvement
and meeting customer needs completely. For the moment, the quality commitment can be recognized
as a hallmark of enlightened productivity management in any organization.

Apple Computer Inc.

Where people and design create the future
Innovative design is a mainstay of Apple's business model. But there's more to the company than that.
Under the leadership of co-founder Steve Jobs, Apple is a model of operating efficiency and
marketing savvy. He claims we are entering the third and "golden age" of personal computing. With
this vision, there is no doubt that Jobs brings passion, inventiveness, and a great eye for customer
markets to the firm. But the execution comes from people and the team-driven, technology-rich, and
talent-based high-performance environment that represents life within! Apple. If you want to study a
company that operates in the world of the new economy with a new workforce and new organization,

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take a look at Apple. Even in the intensely competitive computer industry, the wizardry of Apple sets a
benchmark for the rest of the pack.

MANAGERS IN THE NEW WORKPLACE

In an article entitled "Putting People First for Organizational Success," Jeffrey Pfeffer and John F.
Veiga argue forcefully that organizations perform better when they treat their members better. They
also point out that too many organizations fail to operate in this manner and, as a consequence, suffer
performance failures. Pfeffer uses the term "toxic workplaces" to describe organizations that treat their
employees mainly as costs to be reduced. True high-performing organizations are very different. They
treat people as valuable strategic assets that should be carefully nurtured.

The themes and concepts of Management 8/ e support this view that organizations should operate with
a commitment to people as their most important assets. Importantly and in the day-to-day flow of
events in any workplace, those who serve in managerial roles have a special responsibility for
ensuring that this commitment is fulfilled.

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