1. Managing Small Business Chapter 16

2. Management What do manager do?  Plan – Developing management strategy, business plans, organizational goals, etc.  Organize – Identifying organizational structure, planning jobs, compensation, etc.  Lead – Motivate employees and help them achieve organizational objectives.  Control - Set up monitoring and feedback mechanisms for running an organization.

3. Leadership Leader – Someone who can influence others and who has managerial authority Leadership – What leaders do; the process of influencing a group to achieve goals Ideally, all managers should be leaders Although groups may have informal leaders who emerge, those are not the leaders we’re studying Leadership research has tried to answer: What is an effective leader?

4. Leadership Attributes Vision – having a mental picture of where the company is going. Communication – constant, clear communication Integrity – inner strength to demonstrate honest behavior in all situations Trust – bond between leaders and followers Commitment – loyalty to one’s company. Passion cannot be faked

5. Leadership Attributes Creative Ability – good leadership involves creating something that didn’t exist before. Toughness – difficult decisions must be made for the health of the business. Ability to take action – must realize that without action, all of these attributes are worthless.

6. Suggestions for Building Trust Practice openness. Practice openness. Be fair. Be fair. Speak your feelings. Speak your feelings. Tell the truth. Tell the truth. Show consistency. Show consistency. Fulfill your promises. Fulfill your promises. Maintain confidences. Maintain confidences. Demonstrate competence Demonstrate competence

7. Empowering Employees Empowerment  Involves increasing the decision-making discretion of workers such that teams can make key operating decisions in develop budgets, scheduling workloads, controlling inventories, and solving quality problems.  Why empower employees? Quicker responses problems and faster decisions. Addresses the problem of increased spans of control in relieving managers to work on other problems.

8. Gender Differences in Leadership Research Findings  Males and females use different styles: Women tend to adopt a more democratic or participative style unless in a male-dominated job. Women tend to use transformational leadership. Men tend to use transactional leadership

9. Where Females Do Better

10. Negotiation Skills Negotiation – How to negotiate well (The Power of Nice  Stay rationally focused on the issue being negotiated  Exhaustive preparation is more important than aggressive argument.  Think through your alternatives. The more options you believe you have, the better your position.

11. Negotiation Skills Negotiation – How to negotiate well (The Power of Nice  Spend less time talking and more time listening and asking good questions.  Let other side make the first offer. If you’re underestimating yourself, you might make a needlessly weak move.  Always seem put-off at your rival’s offer. Play up the importance of factors you don’t care about so that they seem like a bigger deal.

12. Delegation Skills Delegation allows the manager freedom from making every decision that has to be made, giving him or her time to concentrate on more important matters.  Delegation empowers employees.  Delegation makes employees the owner of their decisions.

13. Motivating Employees Motivation is the reason an individual takes an action in satisfying some need.  Maslow’s Hierarchy of Needs  Herzberg’s motivation-hygiene theory

14. Motivating Employees Motivation  Is the result of an interaction between the person and a situation; it is not a personal trait.  Is the process by which a person’s efforts are energized, directed, and sustained towards attaining a goal. Energy: a measure of intensity or drive. Direction: toward organizational goals Persistence: exerting effort to achieve goals.  Motivation works best when individual needs are compatible with organizational goals.

15. Motivating Employees

16. Maslow’s Hierarchy of Needs Theory  Needs were categorized as five levels of lower- to higher-order needs. Individuals must satisfy lower-order needs before they can satisfy higher order needs. Satisfied needs will no longer motivate. Motivating a person depends on knowing at what level that person is on the hierarchy.  Hierarchy of needs Lower-order (external): physiological, safety Higher-order (internal): social, esteem, self-actualization

17. Motivating Employees Herzberg’s Motivation-Hygiene Theory  Job satisfaction and job dissatisfaction are created by different factors. Hygiene factors: extrinsic (environmental) factors that create job dissatisfaction. Motivators: intrinsic (psychological) factors that create job satisfaction.  Attempted to explain why job satisfaction does not result in increased performance. The opposite of satisfaction is not dissatisfaction, but rather no satisfaction.

18. Motivating Employees