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EXPLORING BUSINESS V. 2.1 By Karen Collins

CHAPTER 6 MANAGING FOR BUSINESS SUCCESS

LEARNING OBJECTIVES Identify the four functions of management. Understand how a company develops and implements a strategic plan Discuss options for organizing a business and create an organization chart Explain how managers motivate others, monitor operations and assess performance. Understand how a company develops and implements a strategic plan. Describe the skills needed to be a successful manager.

MANAGEMENT THE PROCESS OF PLANNING, ORGANIZING, DIRECTING, AND CONTROLLING RESOURCES TO ACHIEVE SPECIFIC GOALS

EFFICIENCY AND EFFECTIVENESS EFFICIENCYEFFECTIVENESS Use as few resources as possible.Achieve goals as fully as possible. Managerial Success: Low resource use: high efficiency High goal achievement: high effectiveness

FUNCTIONS OF MANAGEMENT PLANNINGORGANIZINGDIRECTINGCONTROLLING

THE ROLE OF PLANNING PLANNINGORGANIZINGDIRECTINGCONTROLLING

PLANNING MANAGERS SET GOALS AND DETERMINE THE BEST WAY TO ACHIEVE THEM

STRATEGIC PLAN Write a Mission Statement Identify Core Values Assess the company’s strengths, weaknesses, opportunities and threats Establish Goals and Objectives Develop and Implement Tactical/Operational Plans ESTABLISHING AN OVERALL COURSE OF ACTION

MISSION STATEMENT DESCRIBES THE PURPOSE OF YOUR ORGANIZATION—THE REASON FOR ITS EXISTENCE

CORE VALUES Link core values to performance evaluations and compensation. FUNDAMENTAL BELIEFS ABOUT WHAT’S IMPORTANT AND WHAT IS AND ISN’T APPROPRIATE IN CONDUCTING COMPANY ACTIVITIES

SWOT ANALYSIS Examines internal and external forces that affect the company. Determines how the company fits into its environment. STRENGTHS, WEAKNESSES, OPPORTUNITIES, THREATS

GOALS & OBJECTIVES (PERFORMANCE TARGETS) Goals: major accomplishments to achieve over a long time Objectives: shorter-term performance targets that direct efforts toward reaching a goal An Organization: –Will have a number of goals and objectives –Will change its goals and objectives over time

TYPES OF PLANS Strategic –Long-term –Overall course of action –Established by upper-level managers –Implemented by managers at all levels Tactical –Shorter term –Specify activities and resources needed to implement strategic plans Operational –Detailed action steps taken to implement tactical plans

CONTINGENCY VS. CRISIS CONTINGENCY PLANNINGCRISIS MANAGMENET Planning—Identify aspects of the business most likely to be adversely affected by change. Then develop alternative courses of action in case change occurs. Action plans that outline steps to be taken by a company in case of a crisis.

ORGANIZING ALLOCATES RESOURCES (PEOPLE, EQUIPMENT, AND MONEY) TO ACHIEVE A COMPANY’S PLANS

LEVELS OF MANAGERS Top Managers: Responsible for health and performance Middle Managers: Oversee activities of first-line managers First-Line Managers: Supervise employees and coordinate their activities

ORGANIZING: LEVELS OF MANAGEMENT

ORGANIZATIONAL STRUCTURE Job Specialization: Organizing activities into clusters of related tasks that can be handled by an individual or group. Departmentalization: Grouping specialized jobs into meaningful units, such as divisions or departments. ARRANGEMENT OF JOBS IN AN ORGANIZATION THAT’S MOST APPROPRIATE FOR THE COMPANY AT A SPECIFIC POINT IN TIME

PRODUCT DIVISION SARA LEE BAKED GOODS PACKAGED MEATS BEVERAGES, HOUSEHOLD, AND BODY CARE KNITWEAR AND OTHER CLOTHING

CUSTOMER DIVISION JOHNSON & JOHNSON PERSONAL CARE AND HYGIENE PRODUCTS PRESCRIPTION DRUGS MEDICAL DEVICES AND DIAGNOSTIC PRODUCTS

PROCESS DIVISION BOWATER THUNDER BAY TREE CUTTING CHEMICAL PROCESSING FINISHING

GEOGRAPHICAL DIVISION MCDONALD’SNORTHEASTSOUTHEASTGREAT LAKESMIDWESTWEST

ORGANIZATION CHART Describes “who reports to whom”. A DIAGRAM SHOWING THE INTERRELATIONSHIPS OF POSITIONS WITHIN THE ORGANIZATION

ORGANIZATION CHART: NOTES-4-YOU OWNER- PRESIDENT ACCOUNTING MANAGER MARKETING MANAGER ADVERTISING SALES SUPERVISOR SALES STAFF H.R. MANAGER OPERATIONS MANAGER NOTE- TAKERS SUPERVISOR NOTETAKERS COPIERS SUPERVISOR COPIERS

ORGANIZATION CHARTS: DIVISIONAL STRUCTURES PRESIDENT VICE PRESIDENT RIDES VICE PRESIDENT CONCESSIONS BANK PRESIDENT VICE PRESIDENT RETAIL CUSTOMERS VICE PRESIDENT COMMERCIAL CUSTOMERS Divisional structure by productDivisional structure by customer base

ORGANIZATION CHART: COMBINATION PRESIDENT VICE PRESIDENT U.S. OPERATIONS ACCOUNTINGMARKETINGOPERATIONS HUMAN RESOURCES VICE PRESIDENT EUROPEAN OPERATIONS ACCOUNTINGMARKETINGOPERATIONS HUMAN RESOURCES

ORGANIZATION CHART: MATRIX STRUCTURE PRESIDENT DIRECTOR OF PRODUCTS PRODUCT MANAGER A PRODUCT MANAGER B PRODUCT MANAGER C PRODUCT MANAGER D VP: PRODUCT DESIGN VP: MANUFACTURING VP: FINANCEVP: MARKETING VP: HUMAN RESOURCES

LINES OF AUTHORITY Chain of Command: Who is in charge of whom; who does an employee report to Unity of Command: No employee should report to more than one boss Span of Control: Number of layers between the top managerial position and the lowest managerial level. –(Narrow: few reports; Wide: many reports)

DELEGATING AUTHORITY Delegation: Entrusting work to subordinates To assign responsibility for a task, give the employee authority to get it done Centralization (decisions made at top) and Decentralization (decisions spread through the organization)

DIRECTING PROVIDING FOCUS AND DIRECTION TO OTHERS AND MOTIVATING THEM TO ACHIEVE ORGANIZATIONAL GOALS

LEADERSHIP STYLES Autocratic: Make decisions with little input. Don’t want workers to question your authority Democratic: Seek input for decisions Laissez-Faire: Provide little guidance WAY OF INTERACTING WITH AND INFLUENCING OTHERS

TRANSACTIONAL/TRANSFORMATIONAL LEADERSHIP STYLES Transactional: Exercise authority based on rank Transformational: Mentor and develop subordinates

CONTROLLING COMPARING ACTUAL TO PLANNED PERFORMANCE AND TAKING NECESSARY CORRECTIVE ACTION

FIVE-STEP CONTROL PROCESS SET STANDARDS BY WHICH PERFORMANCE WILL BE MEASURED. MEASURE PERFORMANCE.COMPARE ACTUAL PERFORMANCE WITH STANDARDS.DETERMINE REASONS FOR DEVIATIONS.TAKE CORRECTIVE ACTION IF NEEDED.

MANAGERIAL SKILLS TECHNICALINTERPERSONALCONCEPTUAL DECISION- MAKING TIME MANAGMEMENT COMMUNICATION

HOW TO SOLVE A PROBLEM IDENTIFY THE PROBLEM YOU WANT TO WORK ON.GATHER RELEVANT DATA.CLARIFY THE PROBLEM.GENERATE POSSIBLE SOLUTIONS.SELECT THE BEST OPTIONIMPLEMENT YOUR DECISION AND MONITOR YOUR CHOICE.