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Principles of Management 01 - 02 Fall 2007
Principles of Management 01 - 02 Fall 2007
Chapter 1
Understanding the Manager’s Job
Learning Goals
Define management, describe the kinds of
managers found in organizations, and identify
and briefly explain the four basic management
functions
Justify the importance of history and theory to
management and explain the evolution of
management thought
Discuss contemporary management issues and
challenges
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Management
Management is a set of activities
directed at an organization’s
resources with the aim of
achieving organizational goals in
an efficient and effective manner
Management
Activities include the four
functions of management
Planning (and decision making)
Organizing
Leading
Controlling
Management
Resources include:
Human
Financial
Physical
Information
Management in Organizations
Planning
and decision Organizing
making
Inputs from the environment
• Human resources Goals attained
• Financial resources • Efficiently
• Physical resources • Effectively
• Information resources
Controlling Leading
Efficiency
versus
Effectiveness
right (effort)
Waste of
Resources
EFFECTIVENESS
Doing the right things (accomplishment)
Kinds of Managers by Level
and Area
Levels of Management
Top managers
Middle managers
First-line managers
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Areas of Management
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Important Definitions
Top Managers
Middle Managers
First-line Managers
Operative Employees
Managers In Different Areas
of The Organization
Marketing Managers
Financial Managers
Operations Managers
Human Resource Managers
Administrative Managers
The Management Process
Planning and
Decision Making Organizing
Determining how
Setting the organiza-
best to group
tion’s goals and
activities and
deciding how best
resources
to achieve them
Controlling Leading
Monitoring Motivating members
and correcting of the organization
ongoing activities to work in the best
to facilitate goal interests of the
attainment organization
Figure 1.2
The Basic Functions of Management
A Circular Process
Planning and Decision Making
Controlling Organizing
Leading
Skills and
the
Manager
Fundamental Management
Skills
Management Skill Mixes at Different
Organizational Levels
Management: Science or Art?
Science of Management – some
aspects of management are objective
and can be approached with rationality
and logic
Theory
History
The Historical Context of
Management
Management Through the Ages
D Greeks
C Babylonians G Venetians
B Egyptians E Romans
A Sumerians F Chinese
3000 B.C. 2500 B.C. 2000 B.C. 1500 B.C. 1000 B.C. 500 B.C. A.D.500 A.D.1000 A.D.1500
A Used written rules and regulations for governance E Used organized structure for communication and control
B Used management practices to construct pyramids F Used extensive organization structure for government
agencies and the arts
C Used extensive set of laws and policies for governance
G Used organization design and planning concepts to
D Used different governing systems for cities and state
control the seas
An Integrative Framework
of Management Perspectives
Systems Approach Contingency Perspective
• Recognition of internal • Recognition of the situational
interdependencies nature of management
• Recognition of • Response to particular
environmental influences characteristics of situation
1 2 3 4
Supervise employees
Develop a science Scientifically select Continue to plan
to make sure they
for each element of employees and then follow the prescribed the work, but use
the job to replace old train them to do the job workers to get the
methods for performing
rule-of-thumb methods as described in step 1 work done
their jobs
Figure 1.3
The Classical Management
Perspective
SA
Esteem Needs
Social Needs
Security Needs
Physiological Needs
Theory X and Theory Y
Theory X Assumptions
People do not like work and try to avoid it.
Managers have to control, direct, coerce, and
threaten employees to get them to work
toward organizational goals.
People prefer to be directed,
to avoid responsibility, and
to want security; they have
little ambition.
Source: Douglas McGregor, The Human Side of Enterprise, Copyright © 1960
by McGraw-Hill. Reprinted by permission of The McGraw-Hill Companies.
Theory X and Theory Y
Theory Y Assumptions
People do not dislike work; work is a
natural part of their lives.
People are internally motivated to reach
objectives to which they are committed.
People are committed to goals to the
degree that they receive rewards when
they reach their objectives.
Source: Douglas McGregor, The Human Side of Enterprise, Copyright © 1960
by McGraw-Hill. Reprinted by permission of The McGraw-Hill Companies.
Theory X and Theory Y
Theory Y Assumptions
People seek both seek responsibility and
accept responsibility under favorable
conditions.
People can be innovative in solving problems.
People are bright, but under most
organizational conditions their potentials are
underutilized.
Theory X Theory Y
Feedback
Systems Perspective
Open systems interact with one another
and other environments
Closed systems do not interact with their
environment
Subsystems recognizes the importance of
subsystems because of their
interdependence
Systems Perspective
Synergy
Subsystems are more successful working
together than working alone. The whole,
working together, is greater than the sum
of its parts.
Entropy
A natural process leading to system decline
which can be avoided through
organizational change and renewal.
The Universal Perspective vs
The Contingency Perspective
The Universal Perspective tries to identify the
one best way to manage an organization,
includes classical, behavioral and quantitative
approaches
The Contingency Perspective suggests that
universal theories cannot be applied to
organizations because each organization is
unique – what works in one situation may not
work in another
Contemporary Management
Issues & Challenges
Downsizing
Diversity and the New Workforce
Information Technology
New Ways of Managing
Globalization
Ethics and Social Responsibility
Managing for Quality
Service Economy
Principles of Management
Chapter 2
The Environment of Organizations
and Managers
Learning Goals
Discuss the environment of organizations and
identify the components of the general, task,
and internal environments
Describe the ethical and social environment of
management
Describe the international environment of
management
Discuss the importance and determinants of an
organization’s culture
The Organization’s
Environment
External Environment
General environment
Task environment
Internal Environment
Conditions and forces within an
organization.
The Organization and Its
Environments
International Technological
dimension dimension
Competitors
Internal environment
Task environment Sociocultural
External dimension
General environment environment
Five Dimensions of the
General Environment
The economic dimension - the overall health and vitality of
the economic system in which the organization operates
The technological dimension - the methods available for
converting resources into products or services
The political-legal dimension - government regulation of
business and the relationship between business and the
government
The socio-cultural dimension — the general societal/cultural
norms that the organization functions under
The international dimension — the extent to which an
organization is involved in or affected by business in other
countries.
McDonald’s General
Environment
Technological
International Dimension Dimension
• Restaurants in 115 • Improved information
countries technology
• About two-thirds of • More efficient
sales from outside operating systems
the United
States
Political-Legal
Dimension McDonald’s Economic
• Government Dimension
food standards • Strong economic
• Local zoning growth
climate • Low unemploy-
• General posture ment
toward business • Low inflation
regulation
Internal environment Sociocultural Dimension
• Demographic shifts in
Task environment number of single adults
External environment
General environment and dual-income families
• Growing concerns about
health and nutrition
Figure 3.2
Five Dimensions of the Task
Environment
Specific groups affecting the organization
Competitors seeking the same resources as the
organization.
Customers who acquire an organization’s products or
resources.
Suppliers that provide resources for the organization.
Regulators (agencies and interest groups) that control,
legislate, or influence the organization’s policies and
practices.
Strategic partners (allies) who are in a joint venture or
partnership with the organization.
McDonald’s Task Environment
Competitors
• Burger King
• Wendy’s
• Subway
Regulators • Dairy Queen
• Food and Drug
Administration Customers
• Securities • Individual
Exchange
and consumers
Commission • Institutional
• Environmental McDonald’s customers
Protection
Agency
Suppliers
Strategic Partners • Coca-Cola
• Wal-Mart • Wholesale food
• Disney processors
• Foreign partners • Packaging
manufacturers
Internal environment
Task environment
How
Organizations
and
Environments
Interact
How Business and Government
Influence Each Other
The government influences business
through direct and indirect regulation:
The • Environmental protection legislation
Government • Consumer protection legislation
• Employee protection legislation
• Securities legislation
• The tax codes
Employees Organization
• Hiring and firing
• Wages and working
Managerial
conditions
• Privacy and respect
Organizational Values
+
Individual Values
=
Managerial Values
Ethics in Organizations
Managing Ethical Behavior
Must begin with top management
Training on how to handle different ethical
dilemmas.
Code of Ethics
A formal, written statement of the values
3-9 Voluntary
Responsibilities
being a
“good corporate citizen”;
contributing to the
community and quality of life
Ethical Responsibilities
being ethical; doing what is right, just,
and fair; avoiding harm
Legal Responsibilities
obeying the law (society’s codification of right
and wrong); playing by the rules of the game
Economic Responsibilities
being profitable
Figure 2.2
Approaches
to Social
Responsibility