Chapter 1 Management MGMT 2008 Chuck Williams Designed & Prepared by B-books, Ltd.

Management Functions Planning Organizing Leading Controlling 2 Functions of management include planning, organizing, leading, and controlling. Planning is determining organizational goals and a means for achieving them. Organizing is deciding where decisions will be made, who will do what jobs and tasks, and who will work for whom in the company. Leading is inspiring and motivating workers to work hard to achieve organizational goals. Controlling is monitoring progress toward goal achievement and taking corrective action when progress isn’t being made. The textbook is organized based on the four management functions, as shown on this slide. 2

The Control Process 2.4 Set standards to achieve goals Make changes to return performance to standards Compare actual performance to standards 2.4

Responsibilities of Top Managers Creating a context for change Developing commitment and ownership in employees Creating a positive organizational culture through language and action Monitoring their business environments Top managers hold positions like the CEO, the COO, the CFO, and the CIO and are responsible for the overall direction of the organization. 3.1

Responsibilities of Middle Managers Coordinate and link groups, departments, and divisions Monitor and manage the performance of subunits and managers who report to them Implement changes or strategies generated by top managers Plan and allocate resources to meet objectives Middle managers hold positions like plant manager, regional manager, or divisional manager. Note how middle managers’ responsibilities are influenced by those of top managers. Note also how their responsibilities are more narrowly focused than of top managers. 3.2

Responsibilities of First-Line Managers Manage the performance of entry-level employees Encourage, monitor, and reward the performance of workers Teach entry-level employees how to do their jobs Make detailed schedules and operating plans First-line managers hold positions like office manager, shift supervisor, or department manager. First-line managers are the only managers who don’t supervise other managers. They are closest to employees and have daily contact with employees. 3.3

Responsibilities of Team Leaders Facilitate team performance Facilitate internal team relationships Manage external relations This is a relatively new kind of management job that developed as companies shifted to self-managing teams which, by definition, have no formal supervisor. Instead of directing individuals’ work, team leaders facilitate team activities toward goal accomplishment. They have less formal authority, so they lead more through relationships and respect. 3.4

Mintzberg’s Managerial Roles Interpersonal Informational Decisional Figurehead Leader Liaison Monitor Disseminator Spokesperson Entrepreneur Disturbance Handler Resource Allocator Negotiator 4 H. Mintzberg, “The Manager’s Job: Folklore and Fact,” Harvard Business Review (July-August 1975).

What Companies Look for in Managers Technical Skills Human Skills Conceptual Skills Motivation to Manage Technical skills are the ability to apply the specialized procedures, techniques, and knowledge required to get the job done. Technical skills are most important for lower level managers because these managers supervise the workers who produce products or serve customers. Team leaders and first-line managers need technical knowledge and skills to train new employees and help employees solve problems. Technical skills become less important as managers rise through the managerial ranks, but they are still important. Human skills, the ability to work well with others, are equally important at all levels of management, from first-line supervisors to CEOs. However, because lower level managers spend much of their time solving technical problems, upper level managers may actually spend more time dealing directly with people. Conceptual skills are the ability to see the organization as a whole, how the different parts of the company affect each other, and how the company fits into or is affected by its external environment. Conceptual skills increase in importance as managers rise through the management hierarchy. Managers typically have a stronger motivation to manage than their subordinates, and managers at higher levels usually have stronger motivation to manage than managers at lower levels. Furthermore, managers with stronger motivation to manage are promoted faster, are rated by their employees as better managers, and earn more money than managers with a weak motivation to manage. 5

Transition to Management (The First Year) Be the boss Formal authority Manage tasks Job is not managing people Initial expecta- tions were wrong Fast pace Heavy workload Job is to be problem-solver and troubleshooter No longer “doer” Communication, listening, positive reinforcement Learning to adapt and control stress Job is people development Managers’ Initial Expectations After Six Months As a Manager After a Year As a Manager In the book Becoming a Manager: Master of a New Identity, Harvard Business School professor Linda Hill followed the development of 19 people in their first year as managers. Becoming a manager produced a profound psychological transition that changed the way these managers viewed themselves and others. Exhibit 1.5 describes the transition to management. 7

Competitive Advantage through People Management Practices in Top Performing Companies 1. Employment Security 2. Selective Hiring 3. Self-Managed Teams and Decentralization 4. High Wages Contingent on Org. Performance 5. Training and Skill Development 6. Reduction of Status Differences 7. Sharing Information In a study by Stanford University professor Jeffrey Pfeffer, companies who used the management practices listed on this slide achieved financial performance that, on average, was 40 percent higher than that of other companies. 8