1. Managers and Management
PART I: Introduction 1
Managers and Management
Chapter 1
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2. Learning Outcomes (cont’d) After reading this chapter, I will be able to:
Describe the difference between managers and operative employees.
Explain what is meant by the term management.
Differentiate between efficiency and effectiveness.
Describe the four primary processes of management.
Classify the three levels of managers and identify the primary responsibility of each group.
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3. Learning Outcomes (cont’d) After reading this chapter, I will be able to:
Summarize the essential roles performed by managers.
Discuss whether the manager’s job is generic.
Describe the four general skills necessary for becoming a successful manager.
Describe the value of studying management.
Identify the relevance of popular humanities and social science courses to management practices.
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4. Who Are Managers And Where Do They Work?
Organization
A systematic arrangement of people brought together to accomplish some specific purpose; applies to all organizations—for-profit as well as not-for-profit organizations.
Where managers work (manage).
Common characteristics
Goals
Structure
People
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5. Common Characteristics of Organizations
An organization is a systematic arrangement of people to accomplish some specific purpose. Every organization has a purpose, people or members, and a systematic structure. The purpose of an organization is expressed in terms of a goal or set of goals. Within the organization’s structure, its employees strive to achieve these goals.
Exhibit 1.1
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6. People Differences Operatives Managers
People who work directly on a job or task and have no responsibility for overseeing the work of others.
Managers
Individuals in an organization who direct the activities of others.
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7. Organizational Levels
We can categorize organizational members in two ways. Operatives work directly on a job or task and have no responsibility for overseeing the work of others. Managers direct the activities of other people in the organization. Usually classified as top, middle, or first-line, managers supervise both operative and lower-level managers.
First-line managers supervise the day-to-day activities of operative employees.
Middle managers represent the level of management between first-line managers and top management. These managers translate the goals of top management into specific details that lower-level managers can perform.
Top managers make decisions about the direction of the organization and set policies that affect all organizational members.
Exhibit 1.2
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8. Identifying Managers First-line managers Middle managers Top managers
Supervisors responsible for directing the day-to-day activities of operative employees
Middle managers
Individuals at levels of management between the first-line manager and top management
Top managers
Individuals who are responsible for making decisions about the direction of the organization and establishing policies that affect all organizational members
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9. How Do We Define Management?
The process of getting things done, effectively and efficiently, through and with other people
Efficiency
Means doing the thing correctly; refers to the relationship between inputs and outputs; seeks to minimize resource costs
Effectiveness
Means doing the right things; goal attainment
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10. Efficiency and Effectiveness
The term management refers to the process of getting things done, through other people, in an efficient and effective manner.
Process refers to the primary functions that managers perform. Referring to inputs and outputs, doing the task right is being efficient.
Doing the right task is being effective. So, managers are concerned not only with attaining goals (effectiveness) but also attaining them efficiently.
Exhibit 1.3
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11. Management Process Activities
Most experts on the subject of management endorse the concept of four basic interdependent management functions.
Planning consists of several elements: defining an organization’s goals, establishing a strategy to achieve them, and developing a structure to coordinate goal achievement activities.
Organizing includes determining what tasks will be done, who will do them, how the tasks will be grouped, who will report to whom, and where decisions will be made.
Leading involves motivating employees, directing the activities of others, selecting effective communication channels, and resolving conflicts.
Controlling includes monitoring the organization’s performance, comparing it with previously set goals, and correcting deviations to keep the organization on course.
Management process: planning, organizing, leading, and controlling
Exhibit 1.4
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12. Management Processes Planning Organizing
Includes defining goals, establishing strategy, and developing plans to coordinate activities
Organizing
Includes determining what tasks to be done, who is to do them, how the tasks are to be grouped, who reports to whom, and where decisions are to be made
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13. Management Processes (cont’d)
Leading
Includes motivating employees, directing the activities of others, selecting the most effective communication channel, and resolving conflicts
Controlling
The process of monitoring performance, comparing it with goals, and correcting any significant deviations
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14. Mintzberg’s Managerial Roles
Interpersonal
Figurehead
Leader
Liaison
Informational
Monitor
Disseminator
Spokesperson
Decisional
Entrepreneur
Disturbance handler
Resource allocator
Negotiator
In the 1960s, Henry Mintzberg concluded that managers perform ten roles that can be grouped around three themes: interpersonal relationships, information transfer, and decision making.
Managers perform three types of interpersonal roles:
• Figureheads perform ceremonial or symbolic roles.
• Leaders train, motivate, and discipline employees.
• Liaisons contact external information sources.
Managers perform three types of informational roles:
• Monitors collect marketplace information from outside sources.
• Disseminators transmit information to organizational members.
• Spokespersons represent their organizations to outsiders.
Managers perform four types of decisional roles:
• Entrepreneurs initiate and oversee new projects to improve organizational performance.
• Disturbance handlers take action to respond to unforeseen problems.
• Resource allocators control human, mechanical, and monetary resources.
• Negotiators bargain with others to gain advantage for their own units.
Source: The Nature of Managerial Work (paperback) by H. Mintzberg. Table 2, pp. 92–93. Reprinted by permission of Pearson Education Inc., Upper Saddle River, New Jersey.
Exhibit 1.5
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15. Is The Manager’s Job Universal?
Level in the organization
Do managers manage differently based on where they are in the organization?
Profit versus not-for-profit
Is managing in a commercial enterprise different than managing in a non-commercial organization?
Size of organization
Does the size of an organization affect how managers function in the organization?
While the importance of managerial roles varies depending on a manager’s position within an organization, the differences are of degree and emphasis, not of function. As managers move up the organization, for example, they spend less time supervising and more time planning.
All managers, however, make decisions and plan, lead, organize, and control. But the amount of time they give to each activity is not necessarily constant. In addition, the content of the managerial activities changes with the manager’s level.
When measuring managerial performance in business, profit (the bottom line) is an unambiguous criterion. Even though not-for-profit organizations need money to survive, however, their managers do not live and die to maximize profits.
Given this difference, managers working in profit and not-for-profit organizations must perform similar functions: planning, organizing, leading, and controlling.
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16. Distribution of Time per Activity by Organizational Level
Source: Adapted from T. A. Mahoney, T. H. Jerdee, and S. J. Carroll, “The Job(s) of Management.” Industrial Relations 4, no. 2 (1965), p. 103.
Exhibit 1.6
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17. Importance of Managerial Roles in Small and Large Businesses
Consider the following definition of a small business: any independently owned and operated profit-seeking enterprise that has less than 500 employees. Such businesses may be “small,” but they are not insignificant. For example, they account for about 97 percent of all non-farm business in the United States and will generate 50 percent of all new jobs during the coming decade.
Is the job of managing in a small business different from that of managing in a large one? Yes, the difference lies in the importance of roles.
The small business manager’s most important role is that of spokesperson who meets with customers, obtains financing from bankers, seeks new opportunities, and promotes change.
The manager in a large corporation, in contrast, is more internally directed—toward deciding which organizational units get what available resources and how much of them.
Even so, managers in both large and small organizations perform essentially the same activities. The differences lie in how they go about them and the proportion of time they spend on each.
Source: Adapted from J. G. P. Paolillo, “The Manager’s Self Assessments of Managerial Roles: Small vs. Large Firms,” American Journals of Small Business, January–March 1984, pp. 61–62.
Exhibit 1.7
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18. Is The Manager’s Job Universal? (cont’d)
Management concepts and national borders
Is management the same in all economic, cultural, social and political systems?
Making decisions and dealing with change.
Do managers all make decisions and deal with change in the same ways?
While the importance of managerial roles varies depending on a manager’s position within an organization, the differences are of degree and emphasis, not of function. As managers move up the organization, for example, they spend less time supervising and more time planning.
All managers, however, make decisions and plan, lead, organize, and control. But the amount of time they give to each activity is not necessarily constant. In addition, the content of the managerial activities changes with the manager’s level.
When measuring managerial performance in business, profit (the bottom line) is an unambiguous criterion. Even though not-for-profit organizations need money to survive, however, their managers do not live and die to maximize profits.
Given this difference, managers working in profit and not-for-profit organizations must perform similar functions: planning, organizing, leading, and controlling.
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19. General Skills for Managers
Conceptual skills
A manager’s mental ability to coordinate all of the organization’s interests and activities
Interpersonal skills
A manager’s ability to work with, understand, mentor, and motivate others, both individually and in groups
Technical skills
A manager’s ability to use the tools, procedures, and techniques of a specialized field
Political skills
A manager’s ability to build a power base and establish the right connections
Given that all managers perform the four management functions, to some degree, what are the critical areas related to managerial competence?
Effective managers must be proficient in the following four general skills areas:
Conceptual skills refer to the ability to analyze and diagnose complex situations. They help managers to coordinate all of the interests and activities of the organization.
Interpersonal skills encompass the ability to to work with, understand, mentor, and motivate others.
All managers must have technical skills to apply specialized knowledge and expertise.
Managers need political skills to establish the right connections or to build a “power base.”
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20. Specific Skills for Managers
Behaviors related to a manager’s effectiveness:
Controlling the organization’s environment and its resources.
Organizing and coordinating.
Handling information.
Providing for growth and development.
Motivating employees and handling conflicts.
Strategic problem solving.
Research has also identified specific sets of behaviors that explain more than 50 percent of a manager’s effectiveness.
Handling conflicts and motivating employees. Effective managers maximize positive on-the-job situations and minimize conflicts so that employees feel motivated to do their best work.
Strategic problem solving. Managers take responsibility for their decisions and ensure that subordinates use effective decision-making skills.
Handling information. Managers use information and communication channels for identifying problems, understanding environmental changes, and making effective decisions.
Growth and development. Managers use continual learning on the job to provide for the personal growth and development of themselves and their employees.
Controlling the organization’s environment and resources. Effective managers are proactive and stay ahead of environmental changes. They base decisions on clear, up-to-date, accurate knowledge of the organization’s objectives.
Organizing and coordinating. Managers organize around tasks and coordinate interdependent relationships among tasks wherever they exist
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21. Management Charter Initiative Competencies for Middle Managers
Initiate and implement change and improvement in services, products, and systems
Monitor maintain, and improve service and product delivery
Monitor and control the use of resources
Secure effective resource allocation for activities and projects
Recruit and select personnel
Develop teams, individuals, and self to enhance performance
Plan, allocate, and evaluate work carried out by teams, individuals and self
Create, maintain, and enhance effective working relationships
Seek, evaluate, and organize information for action
Exchange information to solve problems and make decisions
Originating in the United Kingdom, the Management Charter Initiative (MCI) sets generic standards for management competence. The MCI standards have attracted international interest. While they can be applied to management in any industry, national differences can require adjustments. Initiate and implement change and improvement in services, products, and systems.
Specific elements that define management effectiveness according to MCI guidelines:
Initiate and implement change and improvement in services, products, and systems.
Monitor, maintain, and improve service and product delivery.
Monitor and control the use of resources.
Secure effective resource allocation for activities and projects.
Recruit and select personnel.
Develop teams, individuals, and the manager himself or herself to enhance performance.
Plan, allocate, and evaluate work carried out by teams, individuals, and the manager himself or herself.
Create, maintain, and enhance effective working relationships.
Seek, evaluate, and organize information for action.
Exchange information to solve problems and make decisions
Exhibit 1.8
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22. How Much Importance Does The Marketplace Put On Managers?
Good (effective) managerial skills are a scarce commodity.
Managerial compensation packages are one measure of the value that organizations place on them.
Management compensation reflects the market forces of supply and demand.
Management superstars, like superstar athletes in professional sports, are wooed with signing bonuses, interest-free loans, performance incentive packages, and guaranteed contracts.
Managers are usually more highly paid than operatives. As a manager’s authority and responsibility expand, so typically does his or her pay. So, compensation packages are one measure of the value that organizations place on good managerial skills.
Most first-line supervisors earn between $30,000 and $55,000 a year.
Middle managers start near $45,000 and top out at about $120,000 annually.
Senior managers can earn $1 million or more per year.
Reflecting the law of supply and demand, management superstars are wooed with attractive perquisites.
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23. Why Study Management?
We all have a vested interest in improving the way organizations are managed.
Better organizations are, in part, the result of good management.
You will eventually either manage or be managed.
Gaining an understanding of the management process provides the foundation for developing management skills and insight into the behavior of individuals and the organizations.
We study management because we interact with organizations every day and have a vested interest in improving the way they are managed. Why? Because we interact with them every day of our lives.
We also study management because after graduation we will either manage or be managed. For those who plan on careers in management, understanding the process of management can form the foundation on which to build their skills.
Even if you do not plan to be a manager, the study of management will help you to understand the way your boss behaves and the internal workings of organizations.
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24. How Does Management Relate To Other Disciplines?
Anthropology
Economics
Philosophy
Political Science
Psychology
Sociology
Management
It is important to understand the humanities and social science courses that directly affect management practices.
Anthropology is the study of societies. It can help managers understand the fundamental values, attitudes, and behavior of people in different countries and within organizations.
Economics is concerned with the allocation and distribution of resources. It provides managers with an understanding of the changing economy and the role of competition and free markets in a global context.
Philosophy inquires into the nature of things, particularly values and ethics. Ethical concerns underlie the existence of organizations and what constitutes proper behavior within them.
Psychology seeks to measure, explain, and change behavior. This field of study can provide insights into human diversity, motivation, leadership, trust, employee selection, performance appraisals, and training.
Sociology studies people in relation to their fellow human beings. Managers can learn how globalization, cultural diversity, gender roles, and family-life are affecting organizations.
Political science studies the behavior of individuals and groups in a political environment. Managers can learn about the structuring of conflict, the allocation of power, and the use of power for individual self interest.
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25. Web Links Visit the Robbins/DeCenzo companion Website
At for this chapter’s Internet resources, including chapter quiz and student PowerPoints.
Diversity Perspectives
Log onto and take a short assessment of your initial perspectives on diversity and its impact on the work of managers today.
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26. Video Case Application Doing Business Privately: Amy’s Ice Cream
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