1. Management Structures
Chapter 11 Management Skills
Management Structures
Section Management Structures
Section Management Functions

2. Management Structures
Key Terms
management
vertical organization
top management
middle management
supervisory-level management
horizontal organization
empowerment
Objectives
Explain how horizontally organized companies differ from vertically organized companies
Name the three levels of management
Explain how a self-managing team functions
Marketing Essentials Chapter 11, Section 11.1

3. Management Structures
Study Organizer
In the following chart, take notes on the types of business organization.
Marketing Essentials Chapter 11, Section 11.1

4. Leadership in the 21st Century
Business leaders around the world expect many changes in the coming years as a result of globalization. Global competition is increasing at a rapid rate, creating companies and managers who are united by common goals and ideals.
Marketing Essentials Chapter 11, Section 11.1

5. Types of Management Structure
The business function of planning, organizing, and controlling all available resources to achieve company goals.
Management X can be defined simply as getting work done through the effort of others. It is the process of achieving goals through the use of the company’s resources, such as human resources, technology, and material resources.
Businesses are generally organized either vertically or horizontally.
Marketing Essentials Chapter 11, Section 11.1

6. Organization
vertical organization
A hierarchical, up-and-down organizational structure in which the tasks and responsibilities of each level are clearly defined.
Vertical organization X refers to a chain-of-command, hierarchical structure where the tasks and responsibilities of each level are clearly defined.
There are three basic levels of management in a vertical organization:
Top
Middle
Supervisory-level
Marketing Essentials Chapter 11, Section 11.1

7. Organization
top management
Managers who make decisions that affect the whole company.
Top management X refers to the people who make decisions that affect the whole company. They include:
CEO (Chief Executive Officer)
President
COO (Chief Operating Officer)
CFO (Chief Financial Officer)
Vice President
Marketing Essentials Chapter 11, Section 11.1

8. Organization
middle management
Managers who implement the decisions of top management.
Middle management X implements the decisions of top management. This level plans how the departments under them can work to reach the top management’s goals.
Marketing Essentials Chapter 11, Section 11.1

9. Organization
supervisory-level management
Managers who supervise the activities of employees who carry out the tasks determined by middle and top management.
Supervisory-level management X supervises the activities of employees who carry out the tasks determined by the plans of middle and top management. Supervisors usually:
Assign duties
Monitor day-to-day activities in their department
Evaluate the work of production or service employees
Marketing Essentials Chapter 11, Section 11.1

10. Horizontal Organization
A structure where top management shares decision making with self-managing teams of workers who set their own goals and make their own decisions.
In horizontal organization X, top management shares decision making with self-managing teams of workers who set their own goals and make their own decisions.
Marketing Essentials Chapter 11, Section 11.1

11. Horizontal Organization
empowerment
Encouragement of team members to contribute and take responsibility for the management process.
At the heart of horizontal organization is a restructuring of traditional management hierarchy. Levels of management are eliminated, and the numbers of supervisors are reduced in a process called flattening. Employees are organized into teams that organize themselves in order to:
Gather information
Analyze it
Take collective action
Encouraging team members to contribute to and take responsibility for the management process is known as empowerment X.
Marketing Essentials Chapter 11, Section 11.1

12. Horizontal Organization
A second characteristic of horizontal companies is organization by process. Self-managing teams are organized around particular processes.
Marketing Essentials Chapter 11, Section 11.1

13. Horizontal Organization
The ideal result of either organization is to have:
Satisfied customers
High productivity
Large profits
Contented investors
Marketing Essentials Chapter 11, Section 11.1

14. Horizontal Organization
The third characteristic of horizontal organization concerns the team’s focus. In vertical organizations, workers look to managers for direction, but in horizontal companies, workers tend to focus on the customer.
Marketing Essentials Chapter 11, Section 11.1

15. SECTION 11.1 REVIEW

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SECTION 11.1 REVIEW
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17. Management Functions Objectives Name the three functions of management
Key Terms
planning
organizing
controlling
mission statement
remedial action
exit interview
Objectives
Name the three functions of management
Describe the management techniques used by effective managers
Explain how to manage employees properly
Marketing Essentials Chapter 11, Section 11.2

18. Management Functions Study Organizer
Draw the following chart. As you read this section, write in management functions and techniques.
Marketing Essentials Chapter 11, Section 11.2

19. What Managers Do
Managers make decisions in addition to supervising and directing the actions of others. Their decisions affect all employees, therefore communicating and motivating people are among the most important of management skills.
Marketing Essentials Chapter 11, Section 11.2

20. Basic Management Functions
All managers perform certain basic functions:
Planning
Organizing
Controlling
Marketing Essentials Chapter 11, Section 11.2

21. Management Functions Good management planning X at any level is:
The process of setting goals and determining how to reach them.
Good management planning X at any level is:
Realistic
Comprehensive
Flexible
To be effective, a management plan should be a written statement that identifies resources that can be used to meet a given goal.
Marketing Essentials Chapter 11, Section 11.2

22. Management Functions Organizing X involves: Assigning responsibility
Establishment of a time frame in which to achieve a goal, assigning employees to the project, and determining a method for approaching the work.
Organizing X involves:
Assigning responsibility
Establishing working relationships
Hiring staff to carry out the work
Directing the work of employees
Marketing Essentials Chapter 11, Section 11.2

23. Management Functions
controlling
The process of setting standards and evaluating performance.
Controlling X is the process of comparing what you planned with the actual performance. It involves:
Setting standards
Evaluating performance according to those standards
Solving any problems revealed by the evaluation
Marketing Essentials Chapter 11, Section 11.2

24. Management Functions
mission statement
A brief paragraph or two that describes the ultimate goals of a company.
Before setting standards, many companies compose a mission statement. A mission statement X is a brief description of the ultimate goals of the company. It identifies products or services offered and the target market.
Marketing Essentials Chapter 11, Section 11.2

25. Management Functions
After a company establishes goals in a mission statement, it adopts standards that are consistent with the goals. Here are some examples of standards:
Financial – profit, cash flow, sales
Employee – productivity, professional conduct, dress
Customer satisfaction – sales returns, complaints, referrals
Quality control – workmanship, repair requests, recalls
Marketing Essentials Chapter 11, Section 11.2

26. Effective Management Techniques
The most effective management techniques are usually a matter of common sense.
Give clear directions: Even the best employees will be unproductive if they do not know what to do.
Be consistent: If you have decided that a job must be done in a certain way, make sure that all employees follow this standard.
Marketing Essentials Chapter 11, Section 11.2

27. Effective Management Techniques
Treat employees fairly: Set reasonable standards of performance and apply those standards to everyone. Always listen to others’ points of view and consider acting on them.
Be firm when necessary: Be ready to be firm and direct if a friendly suggestion does not get an employee on the right track.
Set a good example: Doing this one simple thing will make your supervisory job much easier.
Marketing Essentials Chapter 11, Section 11.2

28. Effective Management Techniques
Delegate responsibility: Some supervisors do too much work themselves. Organize your work responsibilities and try to match each task with the employee who can handle it best. Be sure to take time to teach each employee how to do new tasks.
Foster teamwork in a number of ways:
Encourage team members to learn how to perform tasks outside of their normal areas.
Promote honest discussion before decisions are made.
Listen respectfully to comments and opinions.
Marketing Essentials Chapter 11, Section 11.2

29. Effective Management Techniques
Be ethical: Ethical behavior involves understanding how your actions affect others and striving to make honest and just decisions.
Marketing Essentials Chapter 11, Section 11.2

30. Employee Motivation
Motivating employees is a key skill for any manager. Managers should give frequent feedback and handle evaluations each year.
It is important to reward smart work, not busy work. A person who looks busy may not necessarily be getting the work done. To get results, reward results.
A reasonable amount of conformity is necessary in every company in order to maintain standards, but do not let conformity stifle creativity.
Marketing Essentials Chapter 11, Section 11.2

31. Human Resources
Most companies have a human resources (HR) department that handles:
Recruitment
Hiring and firing
Other personnel matters
Employee personnel records are generally maintained in a file within the HR office.
Marketing Essentials Chapter 11, Section 11.2

32. Recruiting
Recruiting is the process of locating a pool of applicants and selecting employees from this group. Sources include:
Current employees - workers looking for a promotion
Walk-in applicants
Media advertising - advertisements in the newspaper or on the Internet
Public and private employment agencies
Schools
Marketing Essentials Chapter 11, Section 11.2

33. Recruiting
Laws that prohibit discrimination govern both employers and recruitment agencies. Federal law prohibits employers from discriminating on the basis of:
Race
Color
Religion
Gender
National origin
Age
Sexual orientation
Disability
Marketing Essentials Chapter 11, Section 11.2

34. Recruiting
The U.S. Equal Employment Opportunity Commission enforces and regulates these laws.
This ad by the National Organization on Disability encourages employers to hire people with disabilities.
Marketing Essentials Chapter 11, Section 11.2

35. Hiring New Employees
For the employer, the purpose of the job interview is to determine whether an individual has the skills and abilities to perform well on the job. Here are some basic tips for conducting a good job interview:
Have at least two interviews with qualified applicants.
Have at least two people interview final applicants.
Prepare interview questions in advance.
Marketing Essentials Chapter 11, Section 11.2

36. Hiring New Employees Ask only questions that are job related.
Ask the same questions in the same order to different applicants.
Make sure you are following government hiring procedures.
Marketing Essentials Chapter 11, Section 11.2

37. Orientation and Training Programs
Orienting new employees includes more than simply training them for their positions. It is important to make them feel valued and welcome and to familiarize them with the working environment.
Marketing Essentials Chapter 11, Section 11.2

38. Orientation and Training Programs
Orientation commonly includes the following:
Tour of the company and introduction to coworkers
Discussion of the company’s history, mission, and values
Description of what the company does
Training on equipment
Information on where facilities are located
Information about payroll, benefits, and company policies
Marketing Essentials Chapter 11, Section 11.2

39. Scheduling Employees
Employee scheduling is the process of determining which employees should work at what times. Today, most companies use some type of computer scheduling.
Marketing Essentials Chapter 11, Section 11.2

40. Handling Grievances and Complaints
Employee complaints should be taken just as seriously as customer complaints. Most will fall into three categories:
Complaints about other employees
Complaints about the quality of the company’s product or service
Complaints about their own work situation
Conflicts in the workplace can damage morale and productivity, so each complaint should be handled with care and discretion.
Marketing Essentials Chapter 11, Section 11.2

41. Assessing Employee Performance
Assessment enables a manager to develop better workers and a more efficient and profitable company. In many companies, newly hired employees are placed on a probationary period for three to six months after which they are evaluated to determine whether or not they will be permanently hired.
Annual evaluations are common after the employee is permanently hired.
Marketing Essentials Chapter 11, Section 11.2

42. Remedial Action
remedial action
Using preventive discipline or corrective discipline to encourage appropriate workplace behavior.
Whenever a supervisor notices that an employee’s performance or behavior is substandard, it is the supervisor’s responsibility to discuss the matter with the employee. Remedial action X can be either preventive discipline or corrective discipline.
Marketing Essentials Chapter 11, Section 11.2

43. Remedial Action
Preventive discipline focuses on managing employees in a way that prevents behavior that might require directly disciplining an employee. Preventive techniques can include:
Involving employees in setting standards
Encouraging employees to meet standards
Providing training programs for self-discipline
Marketing Essentials Chapter 11, Section 11.2

44. Remedial Action
Corrective discipline is the next step after preventive discipline. Corrective counseling involves a discussion between the employee and a human resources counselor about the problem and what must be done to correct it.
More severe forms include:
Verbal warnings
Written warning to the employee with a copy for that employee’s personnel file
Suspension from work without pay
Firing
Marketing Essentials Chapter 11, Section 11.2

45. Dismissing Employees
When a decision is made to dismiss a worker, a letter of dismissal must be written, along with separate checks for final salary and severance pay.
Marketing Essentials Chapter 11, Section 11.2

46. The Exit Interview
exit interview
An interview arranged by the human resources department when an employee leaves a company.
An exit interview X provides the opportunity for both the employee and manager to obtain valuable feedback. Exit interviews are often conducted with human resources personnel rather than the employee’s immediate supervisor.
An employee always has the right not to participate in an exit interview.
Marketing Essentials Chapter 11, Section 11.2

47. The Exit Interview
Departing employees may have feedback on overall work conditions that will help the company retain workers in the future.
If the employee is being dismissed, the reason should be discussed in the exit interview.
Marketing Essentials Chapter 11, Section 11.2

48. SECTION 11.2 REVIEW

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SECTION 11.2 REVIEW
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50. Section 11.1
The global marketplace will influence the kind of leadership companies will need in the future.
Businesses are organized in one of two ways: vertically or horizontally.
Traditional, vertically organized companies have three levels of management: top management, middle management, and supervisory-level management.
continued

51. Section 11.1
Horizontal companies have top and middle management. Horizontally organized companies have self-managed teams that set their own goals and make their own decisions.
continued

52. Section 11.2
Basic management functions are planning, organizing, and controlling.
Effective management techniques involve properly training employees, letting them know what is expected of them, and treating them fairly.
In the case of poor performance or unacceptable behavior, the employee should receive warnings. These warnings should be included in the employee’s personnel file. A letter of dismissal should be given to the employee at dismissal time, along with the final salary amount due.

53. This chapter has helped prepare you to meet the following DECA performance indicators:
Explain the concept of management
Identify desirable personality traits important to business
Analyze employer expectations in the business environment
Explain the nature of managerial ethics
Make oral presentations

54. CHAPTER 11 REVIEW

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CHAPTER 11 REVIEW
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