Giáo trình Management challenges for tomorrows leaders 5e by lewis

Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis Giáo trình Management challenges for tomorrows leaders 5e by lewis

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Southern Illinois University Edwardsville

Challenges for Tomorrow’s Leaders

Management

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life each day.

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PAMELA S LEWIS

Pamela S Lewis is president of Queens University of Charlotte in Charlotte, N.C Prior to becomingpresident, Dr Lewis served as the dean of the McColl School of Business at Queens and as dean of theLeBow College of Business at Drexel University in Philadelphia Throughout her career, Dr Lewis hasdistinguished herself through her commitment to providing innovative and high-quality education.Her particular focus has been on increasing community involvement and forging industry andacademic partnerships that enhance the relevance and applicability of academic programs Dr Lewis,who holds a Ph.D in strategic planning and international business from the University of Tennessee,has written numerous articles in the areas of strategic planning, international strategy, and entrepre-neurship/new venture strategy Dr Lewis also has been active in executive education and consulting,serving as a strategic planning consultant for numerous organizations across a wide variety ofindustries Dr Lewis serves on the Board of Directors for three public companies—Sonoco ProductsCompany, C&D Technologies, and Charming Shoppes—as well as on the board of numerous not-for-profits such as Presbyterian Hospital, Charlotte Chamber of Commerce, Communities in Schools,Charlotte Museum of History, and YMCA of Greater Charlotte

STEPHEN H GOODMAN

Stephen H Goodman is an associate professor of management information systems at the University

of Central Florida He received his Ph.D in business administration from Pennsylvania StateUniversity, where he specialized in operations management and operations research Prior to hisdoctoral study he received a B.S in aeronautical engineering and an M.B.A., also from Penn State.During his academic career, he has taught, researched, and published primarily in production planningand control He has also served as a coauthor of a textbook in the field of production/operationsmanagement Currently he has a major teaching and research focus in quality management He is anactive member of the Decision Sciences Institute (DSI) and the American Production and InventoryControl Society (APICS), having held offices in each, has engaged in journal review activities, and hasconducted professional training classes He has achieved the distinction of Certified Fellow inProduction and Inventory Management (CFPIM) from APICS

PATRICIA M FANDT

Patricia M Fandt is professor emeritus at the Milgard School of Business, University of Washington,Tacoma, a faculty associate in educational leadership at the University of North Carolina at Charlotte,and a director with The Geneva Foundation Dr Fandt earned her doctorate in management andorganizational behavior from Texas A&M University in 1986

Throughout her academic career, Dr Fandt has published numerous peer-reviewed articles andbooks on leadership performance, accountability, team dynamics, and organization change Currently,

her research extends from her recently published book The 2nd Language of Leadership and involves

the integration of the personality/leadership behavior framework with the impact of change

Her undergraduate and graduate teaching is primarily focused on team development, leadership,and organization change, and she has been recognized with awards for teaching and curriculumdevelopment excellence

Dr Fandt’s industry experience includes a career in marketing as a sales representative withProcter & Gamble, an account manager with Kendall Surgical Corporation, and a regional sales

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In the consulting arena, Dr Fandt has worked with a broad range of companies in health care,

service, and technology industries She consults with several universities on curriculum development

and accreditation review

JOSEPH F MICHLITSCH

Joseph F Michlitsch teaches strategic management in the School of Business at Southern Illinois

University Edwardsville (SIUE) and is chair of the Management and Marketing Department He holds

a Ph.D in management from the University of Minnesota, an M.B.A from the University of South

Dakota, and a bachelor of science degree in economics from South Dakota State University He is

licensed to present the Stephen Covey 7 Habits of Highly Effective People workshops at SIUE

Dr Michlitsch publishes in the areas of strategy development, strategy implementation,

managerial decision making, and the teaching of management Outlets for his work include Strategy &

Leadership, Industrial Management, Business Insights, Supervisory Management, Journal of Education for

Business, Research in Higher Education, Labor Law Journal, Public Personnel Management, Journal of

Technical Writing and Communication, and Perceptual and Motor Skills He also consults in strategy

development and the many parts of strategy implementation (organization development, individual

development, team building, and communication)

Previously, he taught at several colleges in South Dakota and at the University of Minnesota while

completing his Ph.D degree He worked with the Planning Department at Monsanto Chemical

Company, now Solutia, during one sabbatical leave from SIUE, and during a second leave assisted the

director of management consulting at Grace & Company in writing the second edition of a strategy

book for practitioners

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Part 1 Meeting the Challenges of the 21st Century 1

Part 2 Planning Challenges in the 21st Century 87

Part 3 Organizing Challenges in the 21st Century 183

Part 4 Leadership Challenges in the 21st Century 289

Part 5 Control Challenges in the 21st Century 401

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Facing the Challenge: Can anyone save

Nissan Motor Co., Ltd.? 4

Managing in the 21stCentury 12

The Internet and Information Technology 12

Why Study Management? 17

Now Apply It: Are You Ready to Lead in the

21stCentury? 18

Implications for Leaders 18

Meeting the Challenge: Carlos Ghosn, Star of

Nissan and the Auto Industry 19

Summary 19

Review Questions 20

Discussion Questions 20 Thinking Critically: Debate The Issue 21 Experiential Exercise 21

Ethics: Take A Stand 22

Case: A Day in the Life of Jeremy Jackson 23 Video Case: Timbuk2—The Art of

Management 24

Chapter Overview 27 Learning Objectives 27

Facing the Challenge: “Sony Shock”: Crisis at

the Electronics Giant 28

Introduction 28 Environmental Factors Influencing Management Thought 29

Schools of Management Thought 33

Classical Perspective 33Behavioral Perspective 39

Now Apply It: Theory X and Theory Y 41

Quantitative Perspective 42Systems Perspective 43Contingency Perspective 44

Information Technology and Management Style 45

Future Issues: Diversity, Globalization, and Quality 47

Meeting the Challenge: Sony Makes an

Historic Leap 48

Implications for Leaders 48 Summary 49

Review Questions 50

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Thinking Critically: Debate The Issue 51

Experiential Exercise 51

Case: Leon Neon 53

Video Case: Sunshine Cleaning Systems,

JIAN, and Archway Cookies—Evolution of

Facing the Challenge: General Electric:

Social Responsibility and Ethics 58

Introduction 58

Organizational Stakeholders in a Global

Environment 58

Social Responsibility 60

Premises of Corporate Social Responsibility 60

Perspectives of Social Responsibility 61

The Four Faces of Social Responsibility 64

Social Responsibility Approaches 65

Social Responsibility in the 21stCentury 66

Ethics 67

Understanding Business Ethics 67

Leaders in Action: Cleaning Up Adelphia

Communications 68

Managerial Guidelines for Ethical Dilemmas 70

Now Apply It: Ethics in the Workplace 72

Fostering Improved Business Ethics 72

At the Forefront: Guides to Organization

Behavior 74Does Socially Responsible and Ethical

Behavior Pay? 77

Meeting the Challenge: Social

Responsibility, Ethics, and Profits at GE 78

Case: Cuttinng Jobs at General Motors 83

Video Case: Organic Valley—An Exercise in

Social Responsibility 84

21st Century 87

Facing the Challenge: Changes at

Hewlett-Packard 90

Introduction 90 Strategic Management and Strategic Planning 90

Strategic Analysis: Assessment in a Global Environment 92

Assessing the Mission of an Organization 92

Now Apply It: Setting Mission and Strategic

Setting Strategic Goals 104

Leaders in Action: Andrew Grove of Intel 105

Identifying Strategic Alternatives 106Evaluating and Choosing Strategy 108

Strategy Implementation: Focusing on Results 109

Evaluation and Control: Achieving Effectiveness and Efficiency 109

Feedforward Controls 110Feedback Controls 110

Information Technology and Strategic Planning 110

Meeting the Challenge: Focus and

Implementation at Hewlett-Packard 111

Review Questions 112 Discussion Questions 113 Thinking Critically: Debate The Issue 113 Experiential Exercise 113

Case: Developing a Strategic Plan for The

Convenience Stop 115

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Why Should Managers Plan? 122

Now Apply It: Developing a Professional

Development Plan 123

Where Should Planning Begin? 124

Strategic And Operational Planning 126

Facilitating the Planning Process 135

Barriers to Effective Planning 135

Overcoming the Barriers to Planning 135

Meeting the Challenge: Ed Zander Has a

Plan For Motorola 137

Video Case: The Vermont Teddy Bear

Company, Inc.—Planning in the

At the Forefront: Danger Drives Demand for

Armored-Car Makers 148Steps in the Decision-Making Process 148

Identifying Opportunities and DiagnosingProblems 149

Leaders in Action: Nike Executive Seizes

the Moment 150

Identifying Objectives 151Generating Alternatives 151

Now Apply It: Assessing Your

Decision-Making Skills 152Evaluating Alternatives 153Reaching Decisions 153Choosing Implementation Strategies 153Monitoring and Evaluating Feedback 154

Techniques for Enhancing the Quality ofParticipative Decision Making 163

Classifying Decision Situations 165 Strategic Decision-Making Tools 166

Strategy Selection: The Strategic Decision-MakingMatrix 166

Decision-Implications for Leaders 173

Meeting the Challenge: Hello Cypress

Gardens Adventure Park 174

Summary 174 Review Questions 175 Discussion Questions 176 Thinking Critically: Debate The Issue 176 Experiential Exercise 177

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Video Case: Next Door Food Store—

Managerical Decision Making 180

Part 3 Organizing Challenges in the

Core Job Dimensions 188

Now Apply It: Job Design 190

The Evolution of Job Design Perspectives

Line and Staff Responsibilities 197

Authority and Responsibility 198

Leaders in Action: Was Tyco International

Too Flexible 201Implications for Leaders 203

Meeting the Challenge: New and Improved

Proctor and Gamble 204

Case: Designing Jobs and Delegating

Authority 208

Video Case: Machado and Silvetti

Associates, Inc.—Team Structure 208

Organizational Structure 214

Leaders in Action: Will Your Next TV Be a

Dell? 221

Managing Complexity through Integration 222

Now Apply It: Analyzing Organizational

Structure 223Locus of Decision Making 228

Meeting the Challenge: IBM: Changing

Strategy and Structure 231

Case: Carolina Carpets 235 Video Case: Lonely Planet—Global Guide

236

Facing the Challenge: JetBlue 240

Introduction 240 Strategic Human Resource Management 241

Analysis 241Forecasting 241Recruiting 242Selecting 244Selection Methods 244Training 247

Appraising 248Rewarding 250

Leaders in Action: PeopleFirst at

Domino’s 251Legal Environment of Strategic Human Resource Management 253

Important Laws 253

At the Forefront: Speaking Out on Diversity:

Progress Energy 256Labor-Management Relations 257 Implications for Leaders 258

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Case: Should JJ Be Hired? 263

Video Case: PepsiCo—More Than Just

Foundations of Organizational Culture 269

At the Forefront: The Container Store 270

Changing Organizational Culture 275

The Leadership Challenge of Organizational

Change 275

Targets for Change 276

Leading Organizational Change 276

A Framework for Change 276

Phases of Planned Change 277

Meeting the Challenge: Aveda: A Culture in

Case: People-Centric Culture at Sargento

Foods, Incorporated 285

Part 4 Leadership Challenges in the

21st Century 289

Facing the Challenge: TDIndustries 292

Introduction 292 Communication Complexity 293 Exploring and Achieving Effective Communication 293

Components of the Communication Process 294

Context: Global, Diversity and Technology Impact294

Sender 294Message 294Channel 295Receiver 296Feedback 296Noise 296

Interpersonal Communication 296

Oral Communication 296Written Communication 297Nonverbal Communication 297Technological Communication 298

Now Apply It: E is for E-Mail Etiquette 299

At the Forefront: FedEx Captures the Best of

Communication Activities 300Why Managers Communicate 301 Barriers to Effective Communication 301

Cross-Cultural Diversity 301Trust and Credibility 302Information Overload 303Language Characteristics 303Gender Differences 303Other Factors 304

Communication Channels 304

Formal Communication Channels 304

Leaders in Action: Listening and Learning

Builds Success 307

Spontaneous Communication Channels 307

Communication Competency Challenges 308

Developing Feedback Skills 308Advancing Listening Skills 309

Meeting the Challenge: TDIndustries 310

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Case: A Performance Review 314

Video Case: Le Meridien Hotels and

Resorts Limited—Communicating Effectively

within Diverse Organizations 316

Leader Traits and Skills Focus 321

Leadership Behavior Focus 323

Leadership Power Focus 323

Now Apply It: Newly Promoted: Where Do

You Start? 325

Follower-Centered Approaches 327

Self-Leadership Focus 327

At the Forefront: What Goldman Sachs

Looks for in Leaders 328

Gender and Leadership 333

Leaders in Action: Kenneth Chenault on

Distinguishing Features of ExceptionalLeaders 335

Leaders of the Future 335

Meeting the Challenge: Meg Whitman:

Video Case: The Buffalo Zoo—Leading In a

Dynamic Environment 340

Facing the Challenge: Nokia: Creating an

Innovative Culture 344

Introduction 344 Appreciating Individual Differences 345

Personality Characteristics 345

Now Apply It: How Resilient Are You? 349

Matching Personalities with Jobs 350

Critical Elements for Designing Effective Teams 356

Characteristics of Groups 356

Leaders in Action: Successful Teams Share

a Culture 357

Membership Composition 357Size 360

At the Forefront: Merck Pharmaceutical:

Capitalizing on the Power of TeamRewards 361

Team Goals 361

Processes for Team Effectiveness 362

How Teams Develop and Perform 362

Meeting the Challenge: Nokia: Creating an

Innovative Culture 365

Review Questions 367 Discussion Questions 367 Thinking Critically: Debate The Issue 368 Experiential Exercise 368

Case: TigerEye Tech Builds a Team 370 Video Case: Cannondale I—Exploring

Individual Differences and Team Dynamics 372

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Using Behavior Modification 388

Motivational Challenges for Today’s

Managers 388

Participative Management 388

Recognition Programs 389

Money as a Motivator 389

Now Apply It: 391

Rewarding Team Performance 391

International Perspectives 392

Leaders in Action: Mary Kay in China 393

Meeting the Challenge: You Understand

Me: Yum! Brands 394

Case: How’s My [Teenager] Driving? 398

Video Case: P F Chang’s China Bistro—

A Recipe for Success 399

Part 5 Control Challenges in the 21st

Facing the Challenge: Berner Foods:

The Biggest Cheese Maker You Never

Heard Of 404

Introduction 405

Setting Standards of Performance 405Measuring Actual Performance 407Comparing Actual Performance with Standards 407

Criteria for Effective Control 411

Leaders in Action: LINPAC Plastics 413

Selecting the Proper Amount of Control 413

Now Apply It: Checklist for Designing

Effective Control Systems 414Selecting the Focal Point for Control 416

At the Forefront: FAA Proposes New “Black

Box” Rules 418Control Philosophies for Managers 419

Bureaucratic Control 419Organic Control 419Selecting a Control Style in Today’s DiverseMultinational Organizations 420

Impact of Information Technology on Organizational Control 421 Mechanisms for Financial Control 421

Financial Statements 421Financial Ratios 422

Ethical Issues in the Control of a Diverse Workforce 424

Drug Testing 424Undercover Surveillance 424Computer Monitoring 425

Meeting the Challenge: Berner Foods:

Controlling Its Destiny 426

Case: Motorola’s Control of Quality 429 Video Case: Cannondale—Productivity and

Quality in Operations 431

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Chapter Overview 433

Learning Objectives 433

Facing the Challenge: Summit Industrial

Products: Victimized by Its Own Success 434

Introduction 434

What is Operations Management? 434

Manufacturing versus Service Operating

Systems 435

Now Apply It: Checklist for

Manufacturing/Service Classification 437Structural Differences among Operating

Systems 437

At the Forefront: Xtek Employs Advanced

Planning and Scheduling System 439

Operations Management Decision Areas 439

Leaders in Action: Target Laser &

Machining: Company on the Move 442The Role of Productivity and Quality in

Prominent Quality Management Philosophers 453

Impact of Information Technology on

Productivity and Quality 455

Meeting the Challenge: Summit Industrial

Products: Improvement through ERP 456

Case: Inventory Decision Making at

Art Source 461

Video Case: Peapod—Preventing Costs

from Eating Up Your Profits 463

Chapter Overview 465

Learning Objectives 465

Facing the Challenge: Torino, Italy: Lots to

Do to Stage the Olympic Games 466

Organizational Foundations of Information Systems 467

The Changing Business Environment 467Integration of Systems 472

Technical Foundations of Information Systems 473

Information System Components 473

Leaders in Action: Beaver Street Fisheries:

Poster Child for RFID 475

Information versus Data 476Characteristics of Useful Information 477Steps in the Development of High-QualityInformation Systems 478

Attributes of Successful Information Systems 481

Now Apply It: Checklist for Successful

Information System Design 482

The New Technologies 482

Telecommunications and Networking 483

At the Forefront: Remy International:

Centralized Database Key to Success 485

Electronic Commerce 486Artificial Intelligence 487

Impact of Information Technology on Dynamic Organizations 488 Limitations of Computer-Based Information Systems 489

Meeting the Challenge: TOROC Pulls It

Together to Stage the Winter Olympics 491

Case: Safe Haven House 496 Video Case: Cannondale—Information

Technology and Control 498

Glossary 500 Endnotes 513 Name Index 541 Company Index 543 Subject Index 545

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Each new edition of this book presents us with an

opportu-nity to reflect on significant events that have occurred

within the past few years, and to assess their impact on the

matter at hand—the study of management When the

jour-ney of this book began in the mid-1990s, we wanted to fill

the students with enthusiasm and excitement for the course

of study they were about to undertake The field of

manage-ment was then, and continues to be now, one of the most

important and interesting disciplines of business We

recog-nized that times were changing, as were the functions and

roles of managers As the 21stcentury approached we saw a

frenzy of activity as the business community prepared itself

for the dreaded Y2K problem Although this glitch in

com-puter date coding resulted in dire predictions of comcom-puter

system malfunctions, it barely caused a blip on the radar

screen when we rang in the new millennium The economy

continued to soar We saw the rapid ascent and subsequently

equally rapid fall of many dot-com organizations We have

seen changes in political administrations and public policy

Early in the new millennium we find ourselves facing an

economy that is not riding the crest of the wave that it once

surfed Businesses have had to tighten belts, and business

leaders are finding it necessary to turn their full attention to

meeting the challenges of a highly dynamic and rapidly

changing business environment U.S involvement in wars

in Iraq and Afghanistan has shaken the confidence of many

We have been introduced to political terrorism on our own

home front The pernicious events of September 11, 2001,

have altered the face of business and to some extent, have

al-tered our way of life Boarding a commercial airplane is no

longer the simple task it once was Meanwhile, many of the

major air carriers struggle to remain solvent in the wake of

costly security measures

Mother Nature has also played a role in emphasizing the

importance of studying management Since our last edition

our nation has suffered several natural disasters that have

dramatically affected the availability and movement of

re-sources Within a six-week span in 2004 hurricanes Charley,

Frances, Ivan, and Jeanne wreaked havoc in Florida As bad as

they seemed at the time, they pale in comparison to what

blew in from the Gulf of Mexico in 2005 In August of that

year Hurricane Katrina inflicted catastrophic damage to the

Louisiana, Mississippi, and Alabama Gulf Coast Antebellum

mansions that had stood proudly for one and a half centuries

disappeared in the blink of an eye New Orleans, which had

the distinction of being a major U.S port city, a center for

petrochemical production, and a cultural and tourism icon,lay submerged beneath a pool of toxic water Such a cata-clysmic event was destined to have an economic impact foryears to come Countless businesses would struggle to getback on their feet Major reconstruction, renovation, andpreservation efforts would severely tax material supplies inthe construction industry Damage to U.S oil refining capac-ity in Louisiana would push fuel prices to dizzying heights.Less than one month after Katrina, that problem was com-pounded by hurricane Rita’s blow to Texas and Louisianarefineries Those same airlines that were reeling under thepressures of heightened security were now struggling with therising cost of jet fuel and mounting financial losses

Looking beyond the physical destruction and otherconsequences of Hurricane Katrina, we see signs pointing tothe importance of studying management People aroundthe world were horrified as they helplessly watched thetragic events unfold on their television screens U.S citizenscould be seen huddled in squalid conditions within evacua-tion shelters Others could be seen clinging to rooftops wait-ing to be rescued All had to endure days in sweltering heatwith little food or water Meanwhile, leadership at federal,state, and local levels was ineffective in getting relief to thosewho were suffering Effective decision making and decisiveleadership might have prevented much of the loss of lifethat resulted

As students of management, and future business andcivic leaders, you must prepare to face challenges like these,for the business, social, and political environment is des-tined to remain on this volatile course As the times con-tinue to change, so too do the roles of leaders Change iscoming from many directions: the global marketplace hasredefined the competitive structure of many industries; theincreasing predominance of entrepreneurial and service-based organizations has altered the structure of our econ-omy; quality management has radically changed the waymany organizations do business; and extremist militantgroups are doing all in their power to disrupt the world’sfree-market economy Organizations are being restructuredand redesigned to be lean, flexible, and adaptable to change;leaders in all areas and at all levels of the organization areexpected to be proactive, team-oriented, and focused on re-sults; and diversity in the workforce has become the rulerather than the exception Succeeding as a leader in the or-ganization of today and tomorrow requires a special set ofmanagement skills and competencies

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begin studying one of the most important and

interest-ing disciplines of business: the field of management

Well, as exciting a time as that was, this is perhaps an even

more exciting time to begin studying the field of

manage-ment The challenges we saw then pale in comparison to

the ones we see today Management: Challenges for

Tomorrow’s Leaders should pique your excitement about

this discipline As you progress through the chapters you

will be exposed to the new challenges and contemporary

issues that the leaders of today and tomorrow will

continually face Global competition; organizational

re-structuring; entrepreneurial, service-based, and quality

initiatives; and an emphasis on gender, ethnic, and racial

diversity in the workforce are just a few of the issues that

you and other contemporary managers will confront

Our overriding objective in developing this book was to

capture the excitement and challenges that business

lead-ers will face in the environment of the 21st century

In the few short years since the prior edition of this

book was prepared, much has happened in the business

environment that needed to be captured in this new

edi-tion As authors, we also have had to adapt to change

While significant changes have been made in each

chap-ter, the theoretical content of the chapters remains true to

the earlier editions and the pedagogical objective has not

wavered Management: Challenges for Tomorrow’s Leaders

still provides comprehensive coverage of traditional and

emerging management theory, and has a special focus on

honing the leadership skills that will be necessary for

sur-vival in the dynamic, global environment of business

The application orientation of the book has also

re-mained strong A number of features provide you with an

opportunity to implement the material you learn and to

understand a wide variety of real-world management

sit-uations In short, the book is designed to help you

de-velop an understanding of the field of management and

to develop the competencies and skills that will enable

you to succeed in the business environment of the future

Changes in this

Edition

• In the prior editions of this book, each chapter

opened with an incident that details a real-life

orga-nizational problem or situation that is related to the

content of the chapter This pedagogy was very well

received, and continues in this edition However,

each chapter opening, now called “Facing the

Chal-lenge,” has been changed to provide fresh

illustra-ory of the chapter The challenge is referred to often

as the chapter unfolds At the close of the chapter,

“Meeting the Challenge” describes how the problemwas solved or the situation was addressed

• The boxed material (highlighted examples) in eachchapter has been replaced with updated or new il-lustrations and applications of contemporary man-agement practice These highlighted examples fallinto the categories of Leaders in Action, At the Fore-front, Now Apply It, and of course the Facing theChallenge and Meeting the Challenge so prominent

in each chapter

• Every chapter has been updated to reflect many of thechanges that have occurred in the business world dur-ing the past few years Along with the major featuresnoted above, many new illustrative examples havebeen woven into the fabric of each of the chapters

In all, more than 50 new company situations andscenarios have been developed to accompany the theoret-ical content of the chapters, as well as numerous addi-tional company examples interspersed through the text.Text Highlights

This book includes a number of features designed to pare students to be leaders in this new millennium Thesefeatures focus on: (1) meeting the challenges inherent in

pre-a dynpre-amic, rpre-apidly chpre-anging business environment,(2) developing the competencies and skills that leaderswill need in the future, (3) bridging the gap betweenmanagement theory and practice, and (4) responding tothe contemporary management trends that will affectboth organizations and managers in the 21st century

• Challenges for Tomorrow’s Leaders The underlying,

integrating theme that forms the foundation ofthis book is meeting the leadership challenge as webegin the new millennium As tomorrow’s leaders,you will be challenged continually to respond toopportunities and threats that arise in the dy-namic, global environment of business You willneed to be creative in the way you think about andrespond to these challenges As competitive pres-sures continue to escalate and consumers aroundthe globe demand increasing levels of quality, youwill find it necessary to strive for excellence in allfacets of your organizations Our focus in this book

is to prepare you to meet these challenges as theyaffect the activities in which you will engage andthe roles you will play

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an emphasis on the competencies and skills needed

by contemporary leaders As students of

manage-ment, you must be prepared to translate theory into

practice as you move into the workplace To do so,

you will need to develop fully your skills in such

im-portant areas as teamwork, critical thinking,

prob-lem solving, communication, and adapting to

change

• Theory and Practice This book bridges the gap

be-tween management theory and practice by using an

interdisciplinary, applied approach to the material in

the text Because leaders come from all areas of an

organization (for example, production departments,

finance and accounting departments, sales and

mar-keting departments), it is important to understand

how the concepts of management are applied in the

various functional areas of organizations of all sizes

Further, an interdisciplinary approach to the study of

management is essential given the blurring of the

lines separating the traditional functions of business

(for example, management, marketing, and finance)

and the increasing predominance of cross-functional

work teams within contemporary organizations

• Contemporary Management Trends Finally, we have

identified and highlighted several contemporary

management trends that present challenges for

or-ganizations and leaders today They include global

management, entrepreneurship, service

manage-ment, quality, team-based managemanage-ment, ethics, and

cultural diversity Rather than adding a separate

chapter on each of these trends, we introduce them

very early in the text and then integrate the topics

into each and every chapter of the book

ORGANIZATION

Part 1 of the text addresses the basic concepts of

manage-ment, the roles of the manager, and the changing nature

of both the contemporary organization and the

contem-porary manager The contemcontem-porary management trends

discussed above are introduced, and a foundation is laid

for examining how these trends affect management

the-ory and practice In addition, the histthe-ory of management

thought is reviewed, and the topics of social

responsibil-ity and ethics are addressed in light of their increasing

importance in modern organizations

Part 2 explores the managerial function of planning.

This section examines the basic principles of the

plan-ning process, as well as planplan-ning from a strategic

perspec-tive Strategy is examined as a tool for responding to

an organization’s operations Further, decision making isaddressed as a key managerial responsibility, and a num-ber of tools and techniques for decision making arepresented

Part 3 of the text focuses on the organizing function

of management More specifically, this section addressesthe fundamental principles of organizing, as well as themodels of organizational design that are appropriate forcontemporary, team-oriented organizations Issues oforganizational culture, change, and human resourcemanagement are also addressed in this section Particularemphasis is placed upon organizing to improve flexibil-ity, facilitate change, utilize team management, and re-spond to the challenges of a diverse and heterogeneouswork environment

Part 4 explores the managerial function of leadership.

This section focuses on factors that influence the behavior

of people Separate chapters examine individual and groupbehavior, what motivates members of the workforce, thenature of leadership, and communicating with others Spe-cial attention is given to developing a leadership style thatempowers the members of diverse organizations to excel ineverything they do and to work as a team to achieve thegoals and objectives of the organization

Part 5 examines the management function of control.

The foundational principles of control are addressed, andspecific attention is given to productivity, quality control,and information systems control Control is presented as aprincipal tool for achieving quality in the products, ser-vices, and processes of the organization, as well as a tool fordeveloping a competitive advantage based on enhancedproductivity, increased efficiency, and superior quality

APPLICATION ORIENTED APPROACH

Consistent with our application-oriented approach to thepresentation of contemporary management trends, wehave included the following elements, which are designed

to help you become a more effective manager:

• Chapter Overview Every chapter opens with a

sum-mary that describes the general content of the ter This opening summary highlights the primarytopics and concepts to be covered in the chapter andexplains why the information is important to themanager of the future

chap-• Learning Objectives Each chapter contains a

well-defined set of learning objectives These objectivesfocus on the specific topics covered in the chapter andprovide a checklist of important points discussed in

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summary, and the chapter review questions

• Facing the Challenge/Meeting the Challenge An

opening Facing the Challenge in each chapter details

a real-life organizational problem or situation that is

related to the content of the chapter This incident is

referred to often as the chapter unfolds At the close

of the chapter, a Meeting the Challenge describes

how the problem was solved or the situation was

addressed using the management concepts discussed

in the chapter This allows the student to see how

the concepts and theories presented in each chapter

are applied to business situations in actual

companies

• Ethics: Take a Stand An ethical dilemma related to

the material presented in the chapter appears at the

end of each chapter Students evaluate various

alternative courses of action in terms of their ethical

implications and select one that is both ethical and

meets the objectives of the organization The Ethics:

Take a Stand feature highlights the increasing

importance of leaders making decisions that are

founded on strong individual and organizational

ethics

• Thinking Critically: Debate the Issue Each chapter

contains a debate topic related to the content of the

chapter Students are asked to work in teams to

de-velop arguments to support a particular position

The instructor selects two teams to present their

findings to the class in a debate format This exercise

helps students to develop critical thinking skills,

teamwork skills, and oral communication skills

• Chapter Video Cases At the end of every chapter a

video case presents a real organization that uses

contemporary management practices Seven of the

cases are new for this edition

• End-of-Chapter Cases In addition to the video case

at the close of each chapter, a second case details a

situation that provides an opportunity for students

to apply the concepts and tools presented in the

chapter These cases are designed to help students

develop their analytical thinking skills and to apply

the knowledge they gained from the chapter to

resolve problems or address situations that often

occur in contemporary organizations

• Chapter Summary Each chapter closes with a

sum-mary of the major points presented in the chapter

This overview of the chapter contents provides

students with an overall perspective on the topics

covered Each chapter’s summary is tied directly to

that chapter’s learning objectives

discussion questions is provided at the end of eachchapter The review questions relate directly to thecontent of the chapter and are keyed to the learningobjectives The discussion questions are application-oriented in that they require students to respond toreal-world situations or issues using the knowledgegained from the chapter

• Experiential Exercises Structured experiential

exer-cises are provided at the close of each chapter Theseexercises can be used in either large or small classenvironments and are designed to get students di-rectly involved in the learning process by requiringthem to apply management theory to real-worldsituations Many of these exercises involve self-assessment and will help students gain a greaterunderstanding of their own management competen-cies and skills

• Now Apply It In each chapter, Now Apply It provides

an opportunity for students to practice the ment principles they have studied For example, stu-dents are given the opportunity to use self-assessmentinstruments to describe their own personal manage-ment or leadership styles, and organizationalassessment skills to evaluate organizations

manage-• Key Terms Key terms are highlighted throughout

the chapter and are defined in the margins Acomprehensive glossary is provided at the back ofthe text

• Highlighted Examples Throughout the book,

orga-nizations that provide examples of contemporarymanagement practices are highlighted These exam-ples are designed to profile real companies that areconfronting management challenges and responding

in proactive and innovative ways Each of the ters contains the following highlighted examples:

chap-Leaders in Action Business leaders who have

achieved excellence through their managementpractices and leadership skills are featured inLeaders in Action

At the Forefront Companies that have achieved

excellence through their management practices arefeatured in At the Forefront Of particular interestare those organizations that have adopted a qualityorientation in everything they do

Trang 20

ing their vital teaching function We also include a

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The extended study guide for Management was updated

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Instructor’s Manual with Video Guide (ISBN 0-324-40528-6)

The instructor’s manual for Management was prepared

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• Learning Objectives

• Chapter Overviews

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• Lecture Notes with narratives under each majorpoint to flesh out the discussion and show alterna-tive examples and issues to bring forward

• Detailed Responses to the review questions, sion questions, Ethics: Take a Stand exercises, cases,and experiential exercises

discus-• A Video Guide describing the video cases that company each chapter, including questions for dis-cussion and detailed responses The video guide wasprepared by Cynthia L Sutton of Metropolitan StateCollege of Denver

ac-• Additional Cases with suggested answers for thoseinstructors who wish to supplement the case mate-rial included in the text

Test Bank (ISBN 0-324-40525-1)

Special attention was given to the preparation of the testbank because it is one of the most important ancillarymaterials Linda Putchinski, University of CentralFlorida, has updated the fourth edition test bank The testbank contains over 3,500 multiple choice, true/false,matching, case, and essay questions

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Trang 21

book Available online at http://lewis.swlearning.com

Video Package: Seventeen Chapter Video Cases

(ISBN 0-324-40529-4, DVD; 0-324-36200-5 VHS)

In this edition we have incorporated seven new video

seg-ments that highlight all aspects of today’s management

One video segment ranging from 5 to 30 minutes

accom-panies each of the chapters and helps to explain the

con-cepts of that chapter The videos are supported by cases,

which are included in the text, and a video guide, which

is included in the Instructor’s Manual The cases and

video guide were prepared by Cynthia L Sutton of

Met-ropolitan State College of Denver

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Save time managing your course, posting materials,

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on-line at http://lewis.swlearning.com, including

download-able ancillaries, interactive quizzes, news summaries, and

more

Instructor’s Resource CD-ROM (ISBN 0-324-40532-4)

This CD-ROM provides instructors with “one-stop

shop-ping” for various teaching resources, including the

chap-ter PowerPoint slides, the Instructor’s Manual, and the

Test Bank

ManagementNOW

This online assessment-driven and student-centered

tu-torial provides students with a personalized learning

plan Based on a diagnostic pre-test, a customized

learn-ing path is generated for each student that targets his or

her study needs and helps the student to visualize,

orga-nize, practice, and master the material in the text Media

resources enhance problem-solving skills and improve

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Transform any lecture into a truly interactive student

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sev-eral leading keypad systems, JoinIn turns your ordinary

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software With just a click on a hand-held device, your

students can respond to multiple choice questions, short

polls, interactive exercises, and peer-review questions

better assess student needs, and even administer quizzeswithout collecting paper or grading In addition, we pro-vide interactive text-specific slide sets that you can mod-ify and merge with any existing PowerPoint lecture slidesfor a seamless classroom presentation This interactivetool is available to qualified college and universityadopters For more information, contact your Thomsonrepresentative or visit http://turningpoint.thomsonlearn-ingconnections.com

Business & Company Resource Center (ISBN 33727-6)

0-759-Gain online access to global business cluding competitive intelligence, career and investmentopportunities, business rankings, company histories, andmuch more—at no additional cost with the text View a

information—in-guided tour at http://www.gale.com/BusinessRC For

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TextChoice is the home of Thomson Learning’s onlinedigital content TextChoice provides the fastest, easiestway for you to create your own learning materials South-Western’s Management Exercises and Cases databaseincludes a variety of experiential exercises, classroomactivities, management in film exercises, and cases to en-hance any management course Choose as many exercises

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Acknowledgments

A book such as this does not come to fruition solely by thehands of the authors Many individuals have had signifi-cant involvement with this project, and their contributionsmust not go unrecognized Our reviewers made insightfulcomments and valuable suggestions on the preliminarydrafts of this book Although criticism is sometimes a bit-ter pill to swallow, we can now look back and agree that thereviewer comments led to modifications that greatlystrengthened the final product We would like to expressour gratitude to each of the following reviewers:

Fifth Edition Reviewers:

Barbara Barrett, St Louis Community CollegeBruce Barringer, University of Central FloridaRochelle R Brunson, Alvin Community CollegeMaxine Christensen, Aims Community CollegeGerald Ellis, DeVry University

Trang 22

Mary Kiker, Auburn University, Montgomery

Tish Matuszek, Troy University

Linda Beats Putchinski, University of Central Florida

Joan Reicosky, University of Minnesota, Morris

James Saya, College of Santa Fe

Gail Thomas, New Hampshire Community

Technical College/Laconia

Fourth Edition Reviewers:

Maha W Alul, Maryville University

Bruce Barringer, University of Central Florida

Jerry Biberman, University of Scranton

Donna Cooke, Florida Atlantic University

Max E Douglas, Indiana State University

Lorena B Edwards, Belmont University

Kathleen Jones, University of North Dakota

Thomas R Mahaffey, Siena College

John Mastriani, El Paso Community College

Susan S Nash, University of Oklahoma

Charles Stubbart, Southern Illinois University

Cynthia L Sutton, Metropolitan State College of

Denver

Andrew Ward, Emory University

In addition to these manuscript reviewers, other

col-leagues have contributed greatly by developing several of

the high-quality, comprehensive supplements that

sup-port this book These individuals, and their contributions

for which we are so grateful, include:

Instructor’s Manual David A Foote, Middle

Tennessee State UniversityStudy Guide Tish Matuszek, Sorrell College of

Business at Troy UniversityTest Bank Linda Putchinski, University of

Central FloridaVideo Cases Cynthia Sutton, Metropolitan

State College of DenverPowerPoint Slides Charlie T Cook, Jr., University

of West Alabama

this project They include Monica Ohlinger, our mental editor, who played a critical role in linking thehuge network of contributors to this project We also ac-knowledge the stamina of Bob Dreas, our productionproject manager, who not only tolerated our continualchanges to the manuscript as it moved through produc-tion, but actually encouraged us to change whatever wasnecessary to make this product the very best possible

develop-Our thanks also go to Kim Kanakes, senior marketingmanager, for coordinating the outstanding sales and mar-keting efforts awarded this text

Finally, we’d like to thank our families for their port throughout this project Their tolerance of our ab-sence from many family activities, their understanding ofthe time commitment a project like this requires, andtheir continual encouragement to push on enabled us toendure the long nights and lost weekends that made itpossible for us to complete this book For that supportand commitment, we will always be grateful

sup-Pamela S LewisStephen H GoodmanPatricia M FandtJoseph F Michlitsch

Trang 24

Social Responsibility and Ethics

Meeting the Challenges

of the 21st Century

Trang 25

Management and Managers

1

Trang 26

the accomplishments of the “best” managers,

words such as vision, goals, strategy,

customer-driven, innovation, strong diverse leadership, and

increasing profitability are common.

Here are some managers to whom these

words apply Ann Mulcahy took over at Xerox in

2001 and brought the company back to

prof-itability She says, “it’s getting your people

fo-cused on the goal that is still the job of

leader-ship.”2At PepsiCo, Steven Reinemund is pulling

ahead of Coca-Cola3by introducing many

prod-ucts each year that are purchased by customers

throughout the world and by developing

man-agers through mentoring and teaching Carlos

Ghosn brought Nissan Motor Co from near

bankruptcy in 1999 to one of the most profitable

car companies in the world.4 Meg Whitman,

CEO of eBay Inc., is not only on BusinessWeek’s

What do these managers do to be successful?

These managers do “everything” that a manager

is supposed to do That is, they successfully gage in the management functions of planning,organizing, leading, and controlling

en-This chapter introduces you to overall agement Management is defined and the basicmanagerial functions are explained Then thingsthat managers do to carry out the basic functions

man-of planning, organizing, leading, and controllingare discussed These are the roles that managersplay, the scope of their jobs, the levels of manage-ment, and the skills that managers need Next,major changes in the 21st century are discussed

The chapter concludes with an overall work that will be useful to coordinate learningabout management and why it is important tostudy management

frame-When you have finished studying this chapter, you should be able to

1. Define what management is

2. Identify and explain the basic managerial functions

3. Understand the roles that managers play

4. Discuss the scope of responsibilities of functional and general managers

5. Describe the three levels of managers in terms of the skills that they need and the activities

in which they are involved

6. Identify major changes in the 21st century and explain how they will affect management oforganizations

7. Explain the interactions between all the major functions that managers perform and theinteractions between planning, organizing, leading, and controlling

8. Explain why it is important to study management

LEARN I NG OBJ ECTIVES

Trang 27

Why did so many of the dot-com companies, or

e-busi-ness companies, go out of existence very quickly only a

year or two after they were founded during the years 1999

and 2000? It seemed that using the Internet and

informa-tion technology was the way to go Many of those starting

the dot-com companies believed that brick-and-mortar

businesses, as traditional businesses were called, would be

extinct in a very short time

Rather than many of the traditional businesses goingout of existence, many of the dot-com companies went out

of existence A basic reason why this happened is because

many of the dot-com managers forgot that a business still

has to deliver something of value to customers, actually has

to deliver it when the customers want it, and has to do this

in a way that will result in profits, at least in the long run

Amazon.com is an example of a company that has hung

on and is now becoming successful It has been profitableonly for a short part of its life, however Amazon and theother companies that have survived and those that havebeen started and have become successful recently havefigured out how to do it They are employing basic man-agement and business principles and practices.7

The same issues apply to traditional businesses andother types of organizations Certainly, not all traditionalbusinesses and organizations are successful either How-ever, as with the dot-com companies, the more successfulones also employ basic business and management princi-ples well.8

That is why this book is about basic management It

is intended to help you learn about management and tohelp understand how changes that are likely to occur willaffect management in the 21st century

The purpose of this chapter is to introduce you tothe field of management It will set the stage for under-standing the foundations of management that are dis-cussed in the rest of the chapters

4 Facing The Challenge

Throughout the 1990s, Nissan Motor Co., Ltd was

getting deeper and deeper into trouble Honda pushed the company out of second-place market share in the Japanese market, and its market share was small in other countries Worse, costs were too high, and profit was gone Nissan had losses in 6 of the last 7 years, from 1993–1999 The company had very high debt There were too many brands that were not differentiated from each other or from the competitors.

Nissan had to discount the price of its vehicles heavily

in order to sell them This resulted in excess capacity and further losses because it could not sell enough vehicles.

At the same time, because the overall competition was very strong, car companies around the world were merging and acquiring others because a company had

to be very large in order to sell enough cars to make a profit It appeared that Nissan could not survive, so the company tried to get large carmakers such as Ford and DaimlerChrysler for partners or to buy Nissan This was not successful.

Finally, in March 1999, Renault purchased trolling interest in Nissan The problem was that Renault was not in much better condition than was Nis- san The future for Nissan looked very bleak.

con-Louis Schweizer, CEO of Renault, assigned Carlos Ghosn, then an executive vice president at

Renault, to take over Nissan Although born in Brazil, Ghosn is a Lebanese citizen because his father was from Lebanon His mother was French Ghosn’s education began in Lebanon and continued with degrees from the two most prestigious schools in France, Ecole Polytechnique and Ecole des Mines de Paris.

Then 30 years old, Ghosn worked for Michelin Tire

Co and went to Brazil to turn around the business there He later became manager of U.S operations and in 1996 joined Renault where he acquired the nickname of “le cost killer” for his efforts to improve Re- nault’s situation.

In 1999 Ghosn headed to Japan to take over san Very quickly, he established a plan to revive Nis- san Is it possible to save a company that is in so much trouble?

Nis-Sources: M Yoshino and M Egawa, Nissan Motor Co., Ltd.,

2002 (Boston: Harvard Business School Publishing, 2002);

“Nissan Aims for More Market Share with First New U.S Plant in

20 Years,” St Louis Post-Dispatch, 28 May 2003, C1–C3; B.

Bremner, G Edmondson, C Dawson, D Welch, and K Kerwin,

“Nissan’s Boss Carlos Ghosn Saved Japan’s No 2 Carmaker:

Now He’s Taking on the World,” BusinessWeek, 4 October 2004,

50–58; G Edmondson, “Smoothest Combo on the Road,”

BusinessWeek, 4 October 2004, 58–60; B Bremner, “The Gaijin

Who Saved Nissan,” BusinessWeek, 17 January 2005, 18.

Can Anyone Save Nissan Motor Co., Ltd.?

Introduction

Trang 28

Management has been defined in many ways

Mary Parker Follett, an early management scholar,

offered what has come to be known as the classic definition

when she described management as “the art of getting

things done through people.”9Although this definition

captures the human dimension of management, a more

comprehensive definition is needed

Management is defined as the process of

administer-ing and coordinatadminister-ing resources effectively, efficiently, and

in an effort to achieve the goals of the organization.10Of

course, management includes establishing appropriate

overall organizational goals The degree to which the goals

are achieved is defined as effectiveness Efficiency is

achieved by using the fewest inputs (such as people and

money) to generate a given output In other words,

effec-tiveness means “doing the right things” to achieve the

appropriate goal, and efficiency means “doing things

right.”11The end result of effective and efficient

manage-ment will be organizational success

Management occurs within an zational context But what is an organiza-

organi-tion? An organization is a group of

indi-viduals who work together towardcommon goals Organizations can be forprofit, such as the business organizationswith which we are all familiar (for exam-ple, Starbucks, Wal-Mart, and Dell), or notfor profit, such as churches, fraternities,and public universities Organizations alsoinclude the group that you might puttogether for a trip or for an intramuralsoftball team No matter what

kind of organization it is, allorganizations are made up ofpeople The efforts of thesepeople must be coordinated ifthe organization is to accom-plish its goals Let’s examinethe management process inwhich managers establishoverall goals and then achievethem effectively and effi-ciently That is, let’s study themanagerial process

1

L E A R N I N G

O B J E C T I V E

Define what management is.

1

Management

The process of administeringand coordinating resourceseffectively and efficiently in

an effort to achieve the goals

of the organization

Effectiveness

The degree to which goalsare achieved; doing the rightthings

K E Y T E R M S

Andrea Jung joined Avon

Prod-ucts in 1994 as president of the

Product Marketing Group She

was promoted to president of Global

Marketing in 1996, executive vice

president and president of Global

Mar-keting and New Business in 1997, and

chief executive officer in 1999 The title

of chair of the board was added in

ad-dition to CEO in 2001 When she

be-came CEO in 1999, she was the first

woman to hold that position in the

115-year history of the company.

She also took over a company

that was in very serious trouble

Prof-its were sinking, products were not

inspiring, competitors were eroding

Avon’s sales, and the notion of selling

cosmetics door to door with “Avon

ladies” seemed out of date.

Jung demonstrated that she is a

good leader by engaging every major

principle of good overall management with successful results She started by defining the vision of Avon as the company for women This includes focus

on customers and what they need as well as the many, mostly women, who sell Avon products Then Jung over- hauled almost everything at Avon, from manufacturing, to packaging, to advertising, to selling The updated selling included rejuvenating the sales representatives’ jobs by adding re- wards for representatives who re- cruited more representatives and by making them partners in Internet sales, which could have replaced the door-to-door representatives.

In addition to employing the basic management principles very well, Jung has embraced the Internet as a powerful tool to do business She has also taken the company global by introduc-

ing Avon products in many countries, including Japan and most recently China Diversity is also important to Jung With 86% of its managers being women, Avon has the largest percent- age of women managers of any other Fortune 500 company These are all

good reasons why Fortune magazine

ranks Andrea Jung as the third most powerful woman in business.

Sources: G Brewer, “How Avon’s CEO

Implements Diversity,” Sales and Marketing

Management 149 (no 1) (January 1997): 1;

N Byrnes, “Avon: The New Calling,”

Busi-nessWeek, 18 September 2000, 136; K.

Brooker, “It Took a Lady to Save Avon,”

Fortune, 15 October 2001, 158; J Tarquinio,

“Aging Gracefully at Avon,” Kiplinger’s

Per-sonal Finance, September 2004, 49; “50 Most

Powerful Women,” Fortune, 18 October 2004,

181–198.

The Avon Lady

What Is Management?

Trang 29

In performing the four overall functions, most ofwhat managers do can be categorized into basic

roles Role refers to the behavior that is expected in a

Four overall functions tend to include essentially

everything that managers do in the management

process They are planning, organizing, leading, and

con-trolling (Figure 1.1) Although the details of what each

manager does varies considerably from manager to

man-ager, from organization to organization, and from time to

time, these basic functions have been ful over time to help understand thebroad functions that all managers carryout.12

use-PLANNINGPlanning includes setting goals and defin-

ing the actions necessary to achieve thegoals, in light of the situation That is, thesituation must be analyzed and under-stood and the appropriate goal(s) and

actions must be determined inorder to take advantage ofopportunities and/or to solveproblems While top-levelmanagers establish overallgoals and strategy, managersthroughout the organizationmust develop goals, strategy,and operational plans for theirwork groups that contribute tothe success of the organization

as a whole In addition, theymust develop a plan for ad-ministering and coordinatingthe resources for which theyare responsible so that thegoals of their work groups can

be achieved

ORGANIZINGOrganizing involves deter-

mining the tasks to be done,who will do them, and howthose tasks will be managedand coordinated Managersmust organize the members oftheir work groups and organi-zation so that information,

6

Efficiency

Using the fewest inputs to

generate a given output;

doing things right

Organization

A group of individuals who

work together toward

common goals

Manager

An organizational member

who is responsible for

plan-ning, organizing, leading, and

controlling the activities of

the organization so that its

goals are achieved

Planning

Setting goals and defining the

actions necessary to achieve

those goals

Organizing

The process of determining

the tasks to be done, who will

do them, and how those

tasks will be managed and

en-LEADINGManagers must also be capable of leading the members of

their work groups toward the accomplishment of the ganization’s goals To be effective leaders, managers mustunderstand the dynamics of individual and group behav-ior, be able to motivate their employees, and be effectivecommunicators In today’s business environment, effectiveleaders must also have vision They must be capable of un-derstanding and predicting what will happen in the future,and they must be capable of sharing that vision and guid-ing, empowering, and influencing their employees to makethe vision a reality When this is accomplished, the resultsare very positive A WorkUSA 2002 survey report found asignificant effect in financial results that came from howcompanies managed their people.13

or-CONTROLLING

Managers must monitor the performance of the zation as well as their progress in implementing strategic

organi-and operational plans Controlling includes establishing

and understanding what is required to achieve goals,measuring what actually happened or is being done,identifying deviations between planned and actual re-sults, and taking corrective action if there is a deviation.Such actions may involve pursuing the original planmore aggressively or adjusting the plan to the existing sit-uation Control is an important function in the manage-rial process because it provides a method for ensuringthat the organization is moving toward the achievement

of its goals

Roles of Managers

3

Trang 30

particular situation For example, think about the behavior

that is expected in your role as a daughter or son, as a

friend, as an employee, or as a supervisor Knowing the

ba-sic roles that managers play will help us to better

under-stand what managers do

The work of Henry Mintzberg is widely used to

explain the roles that managers typically perform

Mintzberg conducted a project in which he studied the

actual behaviors of managers He found that there were

ten roles grouped into three categories: interpersonal,

in-formational, and decisional14(Figure 1.2) Considerable

evidence over time supports Mintzberg’s findings.15

INTERPERSONAL ROLES

Interpersonal roles involve interactions and relationships

with organizational members and other constituents The

three interpersonal roles played by the manager are

figure-head, leader, and liaison

As the heads of organizational units, managers must

perform certain duties that are primarily ceremonial in

nature For example, managers may have to appear at

community functions, attend social events, or host

lun-cheons for important customers In doing so, managers

fulfill their role as figureheads

Because managers are responsible for the success

or failure of their organizational units or the

organiza-tional overall, they must play the role of leader In this

ca-pacity, managers work with and through their employees

to ensure that the organization’s goals are met

Finally, managers must serve as liaisons That is, they

coordinate the activities between individuals and work

groups within the organization and develop favorable

relationships with outside constituents Being politically

sensitive to important organizational issues helps them

develop relationships and networks both within and

beyond their organizations

INFORMATIONAL ROLES

In their informational roles, managers are

responsible for ensuring that the people withwhom they work have sufficient information

to do their jobs effectively By the very nature

of managerial responsibilities, managers come the communication centers of theirunits and are a communication source forother work groups within the organization

be-People throughout the organization depend

on the management structure and the managers selves

them-to disseminate information orprovide access to the informa-tion that they need to do theirjobs Informational roles in-clude monitor, disseminator,and spokesperson

As monitors, managerscontinually scan the internaland external environments oftheir organizations for usefulinformation Managers seekout information from theirsubordinates and liaison con-tacts and may receive unso-licited information from theirnetworks of personal contacts

From this information, agers identify potential oppor-tunities and threats for theirwork groups and organiza-tions

man-In their role as tors, managers share and distrib-ute much of the information

dissemina-7

Mission and Planning Organizing

Controlling Leading

Organizational Goals

Controlling

Monitoring the performance

of the organization, ing deviations betweenplanned and actual results,and taking corrective actionwhen necessary

K E Y T E R M S

L E A R N I N G

O B J E C T I V E

Understand the roles that managers play.

3

Trang 31

We have looked at the various functions that agers perform and roles that managers play withinthe organization To this point, however, we have not dis-tinguished among types of managers Managers differ with

man-identified This may involve developing new products,services, or processes

Regardless of how well an organization is managed,things do not always run smoothly Therefore, managerswill have to handle disturbances They must cope withconflict and resolve problems as they arise This mayinvolve dealing with an irate customer, negotiating with

an uncooperative supplier, or intervening in a disputebetween employees

As a resource allocator, the manager determineswhich projects will receive organizational resources Al-though we tend to think primarily in terms of financial

or equipment resources, other types of important sources are allocated to projects as well Consider, for ex-ample, the manager’s time When managers choose tospend their time on a particular project, they are allocat-ing a resource Information is also an important resource

re-By providing access to certain information, managers caninfluence the success of a project

Managers also must be negotiators in certain tions Studies of managerial work at all levels have foundthat managers spend a good portion of their time negoti-ating Managers may negotiate with employees, suppliers,customers, or other work groups Regardless of the workgroup, the manager is responsible for all negotiationsnecessary to ensure that the group is making progresstoward achieving the goals of the organization

situa-they receive as information monitors As disseminators,

managers pass on important information to appropriate

members of their work groups Depending on the nature

of the information, managers may also withhold

informa-tion from work group members Most important,

managers must ensure that their employees have the

infor-mation necessary to perform their duties efficiently and

effectively

The final informational role played by managers

is that of spokesperson Managers must often

communi-cate information to individuals outside their units

and their organizations For example, directors and

share-holders must be advised about the financial performance

and strategic direction of the organization; interest groups

must be assured that the organization is fulfilling its social

obligations; and government officials must be satisfied that

the organization is abiding by the law

DECISIONAL ROLES

Finally, managers play the role of decision maker In their

decisional roles, managers process information and

reach conclusions Information in and of itself is nearly

meaningless if it is not used to make organizational

deci-sions Managers make those decideci-sions They commit their

work groups to courses of action and allocate resources

so that the groups’ plans can

be implemented Decisionalroles include entrepreneur,disturbance handler, resourceallocator, and negotiator

Recall that in the tor role managers scan the in-ternal and external environ-ments of the organization forchanges that may present op-portunities As an entrepre-neur, the manager initiatesprojects that capitalize on op-portunities that have been

ROLES

INFORMATIONAL ROLES

Handler Allocator

Informational role

The manager’s responsibility

for gathering and

disseminat-ing information to the

stake-holders of the organization

Decisional role

The role in which a manager

processes information and

reaches conclusions

K E Y T E R M S

4

Managerial Scope, Levels, and Skills

Reprinted by permission of Harvard Business Review From “The Manager’s Job: Folklore and Fact,” Henry Mintzberg, Harvard Business Review,

Trang 32

managers need the same basic skills, but the importance of

a certain skill may be higher with some types of managers

than others

SCOPE OF RESPONSIBILITY

The nature of the manager’s job will depend on

the scope of his or her responsibilities Some

man-agers have functional responsibilities, whereas others have

general management responsibilities

Functional managers are responsible for work groups

that are segmented according to function For example, a

manager of an accounting department is a functional

manager So are the managers of a production department,

a research and development department, and a marketing

department Work groups segmented by function tend to

be relatively homogeneous Members of the group often

have similar backgrounds and training and perform

simi-lar tasks Functional managers often have backgrounds

similar to those of the people they manage Their technical

skills are usually quite strong because they are typically

promoted from within the ranks of their work groups The

greatest challenge for these managers lies in developing an

understanding of the relationship between their work

groups and the other work units within the organization

Equally important, functional managers must convey

in-formation back to their work groups and ensure that the

members of their units understand their roles within the

organization as a whole

General managers are responsible for ensuring that

several functions or parts of the organization work

to-gether effectively In doing so, they must coordinate and

integrate the work of diverse parts of the organization

For example, the manager of a supermarket is

responsi-ble for managing the overall supermarket by

coordinat-ing all the departments within the store The produce

manager, grocery manager, bakery manager, and floral

manager all report to the general manager Because

gen-eral managers manage diverse departments, their

techni-cal skills may not be as strong as the skills of the people

they manage The manager of the supermarket, for

exam-ple, may not know the difference between a tenderloin or

flank steak or have little idea how croissants are made

However, general managers must be able to coordinate

various parts of the organization in an effective way

LEVELS OF MANAGEMENT AND

RELATIVE IMPORTANCE OF SKILLS

In general, there are three levels of managers: first-line

managers, middle managers, and top-level managers

Fig-the managerial ranks but who actually deliver Fig-the uct or service of the organization The pyramid shape ofthe figure reflects the number of managers at each level

prod-Most organizations have more first-line managers thanmiddle managers and more middle managers than top-level managers (This will be discussed

more in the organizing chapters.)Managers at all organizational levels en-gage in planning, organizing, leading, andcontrolling Carrying out these functions re-quires a set of overall skills However, man-agers at different levels in the organizationtend to be more or less involved in certaintypes of activities, so the degree to whichthey are immersed in the basic functionsvaries For example, a study of over 1000managers examined the extent to whichmanagers at each level engaged in certain ac-tivities, elements of planning, organizing,leading, and controlling, such as managingindividual performance, instructing subor-dinates, planning and allocating resources,coordinating interdependent groups, man-aging group performance, monitoring thebusiness environment, and representingone’s staff The results of the study suggestthat managers at different levels of the orga-nizational hierarchy are involved in these ac-tivities to varying degrees.16Consequently,the degree to which managers at differentlevels employ certain skills also varies This

is shown in Figure 1.4 , summarized in Table1.1 and discussed next

First-Line Managers:

One-to-One with Subordinates

First-line managers supervise

the individuals who aredirectly responsible for pro-ducing the organization’sproduct or delivering its ser-vice They carry titles such asproduction supervisor, linemanager, section chief, or ac-count manager First-linemanagers are often promotedfrom the ranks, based on theirability to deliver the product

or service of the organization

as well as their ability to age others who do the same

man-9

Functional manager

A manager who is ble for managing a work unitthat is grouped based on thefunction served

responsi-General manager

A manager who is ble for managing severaldifferent departments that areresponsible for differenttasks

5

Trang 33

The primary objective of first-line managers is to ensure

that the products or services of their organization are

de-livered to customers on a day-to-day basis

Technical skills tend to be most important for

first-line managers These skills refer to the knowledge and use

of the tools, techniques, and procedures that are specific

to their particular field

Because first-line managers are also involved in two

of the basic activities listed earlier—managing

individ-ual performance and instructing subordinates—they

also use human skills, the ability to work effectively with

others Managing individualperformance involves moti-vating and disciplining subor-dinates, monitoring perfor-mance, providing feedback,and improving communica-tions Instructing subordi-

nates includes training, coaching, and instructing ployees on how to do their jobs

em-First-line managers are also involved in tasks that

re-quire conceptual skills, the ability to analyze complex

situations This may involve planning, scheduling, andrelated tasks However, the first-line manager normallydoes not get involved in conceptual issues to the degreethat a higher-level manager might

Middle Managers: Linking Groups

Middle managers supervise first-line managers or staff

departments They carry titles such as department head,product manager, or marketing manager Middle man-agers may come from the ranks of first-line managers in

a particular department or from other areas of the nization These managers are typically selected becausethey have a strong understanding of the overall strategy

orga-of the organization and a commitment to ensuring that

10

Technical skill

The ability to utilize tools,

techniques, and procedures

that are specific to a

A manager who supervises

the first-line managers or

staff departments

K E Y T E R M S

Top Managers

First-Line Managers

Middle Managers

Operational Employees

F i g u r e 1 3

Managerial Level, Main Skill, and Typical Activities

Ta bl e 1 1

Top Management Conceptual Monitoring the organization environment.

Set strategic direction

Coordinating interdependent groups.

Managing group performance.

Instructing, guiding subordinates.

Managing individual performance.

Trang 34

it is implemented well Essentially, middle managers

per-form as linkages between the top managers and related

overall strategy and the first-line managers A primary

objective of most middle managers is to allocate

resources effectively and manage the first-line managers

who supervise the work group so that the overall goals of

the organization can be achieved.17

Middle managers tend to be most involved in three

basic activities—planning and allocating resources,

coordinating interdependent groups, and managing

group performance The importance of these three

activ-ities rises sharply as one moves from first-line to middle

management, but interestingly, as we will see later, it

de-clines slightly for the top-level management group

Human skills are most important for middle

man-agers because these manman-agers must coordinate the efforts

of members of one’s work group as well as coordinatewith other work groups within the organization Withinthe work group, middle managers must manage groupdynamics, encourage cooperation, and resolve conflicts

When interacting with outside work groups, middlemanagers serve as liaisons, communicating the needs andissues of their teams to other members of the organiza-tion and conveying information from other work groupsback to their units Of course, the other tasks of middlemanagers also require technical and conceptual skills butperhaps not as much as human skills.18

Top-Level Managers: An Eye on the Outside

Top-level managers provide the strategic direction for

the organization They carry titles such as chief executiveofficer (CEO), president, chief operations officer, chieffinancial officer (CFO), chief information officer, andexecutive vice president

Occasionally, top-level managers work their way upthe organizational hierarchy from the first-line manage-ment level However, it is also fairly common for organiza-tions to hire top-level managers from other organizations

Regardless of their background, top-level managersshould be selected because they have a vision for the or-ganization and the leadership skills necessary to guide theorganization toward reaching that vision Top-level man-agers must set the strategic direction of the organization

in light of organizational sources, assets, and skills andthe opportunities and threatsthat were found in monitor-ing the external environment

re-Top-level managers need

to have strong conceptual

MIDDLE MANAGEMENT

TOP MANAGEMENT

Technical

Human Human

Human

Top-level manager

The manager who providesthe strategic direction for theorganization

K E Y T E R M S

Managers must be able to organize the members of their work groups

and lead them toward the accomplishment of the organization’s goal.

Trang 35

skills if they are to effectively accomplish these things.

Conceptual skills enable managers to process a

tremen-dous amount of information about both the external and

the internal environment of the organization and to

de-termine the implications of that information Conceptual

skills also enable top-level managers to look at their

orga-nization as a whole and understand how separate work

groups and departments relate to and affect each other

Finally, strong conceptual skills enable top-level

man-agers to develop a distinctive personality or culture for

their organizations Some examples of very effective

top-level managers include Herb Kelleher, cofounder and

chair of the board at Southwest Airlines; Meg Whitman,

CEO of eBay; Howard Schultz,19founder of Starbucks;

Andrea Jung, CEO of Avon Products; Carlos Ghosn, CEO

of both Nissan and its parent, Renault, at the same time;20

Jack Welch, former CEO of General Electric;21and Andy

Grove, cofounder of Intel In fact, Grove was voted

the “most influential business leader of the past

quarter-century”22 by the prestigious WhartonBusiness School in 2004

As is true of managers at other zational levels, top-level managers alsoneed human and technical skills Top-levelmanagers definitely must work effectivelywith people, inside and outside the organi-zation, and have technical skills so thatthey can understand the financial ramifi-cations and other effects of the technicalparts of the organization However, most

organi-of the tasks organi-of top-level managers tend tofall in the conceptual area, requiring anability to think and to analyze causes, ef-fects, and consequences

The 21st century is still very young, but it hasalready seen some amazing things When it be-gan, the economy in the United States was booming and

dot-com companies appeared ready to take over from

the so-called brick-and-mortar companies It was said

that there was a “new economy” and that everything was

different The old ways of running a business did not

apply anymore In a very short period of time, the

econ-omy cooled and many of the dot-com companies

be-came dot-bombs and imploded.23This was made even

worse by the 9/11 (2001) terrorist attacks Yes, therewere many changes in the economy and in society, therewill continue to be changes, and the rate of change con-tinues to increase However, the same basic business,economic, and managerial principles still apply An or-ganization still has to provide products or services to itscustomers that are valued by those customers Then thecustomers will pay a price that will allow the organiza-tion to be prosperous, so long as it keeps its costs in line.Let’s now discuss important factors that havechanged considerably, some in a very short time andsome that continue to change They all have importantconsequences for managing an organization These fac-tors are the Internet and information technology, in-creasing globalization, increasing diversity, intellectualcapital, and increased emphasis on ethics

THE INTERNET AND INFORMATION TECHNOLOGY

Jeff Bezos, the founder and CEO of Amazon.com,shocked the business world on January 22, 2002, when heannounced that his company had made its first profitever for the third quarter of the previous year.24Why wasthis a shock? Up to that time, most dot-com companiesexperienced large financial losses and were not close toearning a profit After the first profitable quarter, Amazontook a loss the next quarter and several after that.However, Amazon.com was profitable during 2003,and its profitability is continuing.25 Finally, dot-comcompanies were beginning to be financially successful.E-business was working During 2002, roughly onefourth of e-business companies were profitable.26In ad-dition to Amazon.com, this included Expedia, Priceline,and WebMD How did they do it? “It [Amazon.com]earned a profit by getting the basics right: tangible opera-tional efficiencies, heads-down cost cutting, and savvypartnership deals with the likes of Toys R Us Inc and Tar-get Corp.”27E-businesses are using basic managerial andbusiness principles and are profitable.28

Traditional, brick-and-mortar businesses also addedthe use of the Internet, not to replace how they did busi-ness but to compliment their existing businesses Nowone can buy products from Wal-Mart, Barnes & Noble,Sears, REI, and the local auto dealership at the stores and

on the Internet.29

Of course, the Internet and information technologyhas changed some of the aspects of how business is con-ducted Organizations can have almost instant feedbackabout results with sophisticated information systems Theycan also give needed information to people throughout theorganization so that they can perform better Very tightlinks can be established between suppliers and organiza-

Trang 36

tions that can exchange information to coordinate their

operations

Customers can get more information about products

and services on the Internet They can “comparison

shop” to see which businesses have the products they

want and at what price One effect of this is the physical

arrangement and location of retail stores are changing

because informed customers now do not spend time

“shopping” inside of the store.30

Blogs, which are essentially an individual’s online

personal journal, also contain information about

prod-ucts, services, and organizations Being personal, some

of the information is favorable, some unfavorable, and

much of it based on personal tastes and opinions

Orga-nizations are now starting blogs, including the blog set

up by Robert Lutz (vice chairman of General Motors),

to use for advertising and otherwise sending out

posi-tive information.31

All these things increase the bargaining power of

customers The Internet also makes the market for many

products and services global Now a business in most any

country can compete with anyone else as long as the

product can be shipped easily to customers Of course,

with information-based products and services (for ple, concert tickets and airline tickets), competitors cancome from anywhere in the world.32

exam-INCREASING GLOBALIZATION

The Internet makes possible the access to geographicmarkets that were previously out of reach of manycompanies It makes many markets, especially those formany services and those where the product is informa-tion, truly global An important example of this is thehigh-tech call-centers that many U.S companies havemoved to other countries, especially India.33

In addition to the influence of the Internet in

contin-ued globalization, there continues to be more companies

moving various parts of their operations to a larger ber of countries For example, many companies havelocated research labs in China General Electric has 27labs there, MicroSoft Corp has 200 researchers there, andcompanies such as DaimlerChrysler, Cisco, Intel, andIBM are moving labs to China.34

num-Globalization also continues on another front: thecombinations and partnerships between businessesfrom various countries TCL Corp from Huizhou,China, merged with Thomson from France to create thelargest television maker in the world One of the popu-lar television brands that the company makes is RCA, abrand that got its start in the United States with theRCA Co Shanghai Automotive Industry Corp pur-chased 48.9% of Ssangyong, a truck maker in Korea

Perhaps the most interesting and complex combination

of all is the acquisition of controlling interest of the sonal computer operations of IBM by Lenovo GroupLtd from China.35That deal will allow IBM to gain ac-cess to the Chinese market for many of its products andservices and allow the Chinese company to move intothe United States The headquarters of Lenovo will berelocated from Beijing to Armonk, New York, which isclose to IBM’s headquarters IBM managers will managethe new Lenovo headquarters IBM also has an 18.9%

per-ownership in Lenovo.36

The pace and pervasiveness of globalization willcontinue Managers at all levels of organizations willneed to understand the effects of operating in a globalenvironment.37

INCREASING DIVERSITY

Closely connected to theglobalization of business hasbeen the globalization of the

13

Because technology continues to advance and become more

wide-spread, effective managers should have strong technological skills.

Globalization

Various companies moving tomultiple countries and doingbusiness in multiple countries

K E Y T E R M S

Trang 37

labor market Just as goods and services flow relatively

freely across national boundaries, so do human

re-sources The result has been increased diversity of the

population base in the United States as well as other

countries and increased diversity in the workplace.38In

the broad sense, diversity is defined as differences or

va-riety That applies to all types of differences However,

as the word is normally used, diversity refers to the

het-erogeneity of the population and workforce, mostly in

terms of gender and race

Diversity presents new challenges for businesses andmanagers As we will see in subsequent chapters, organiza-

tional success requires a strong organizational culture and

group cohesiveness Achieving this may be more difficult

when the workplace includes people with different

back-grounds, from different nations, or with different cultural

frames of reference Men, women, Caucasians, Hispanics,

African Americans, and others with diverse racial, national,

and ethnic backgrounds often have very different perceptions

about the same situations As a consequence, it may be more

difficult for diverse groups to reach a consensus on common

goals and on the methods for achieving those goals.39

Many organizations today have established trainingprograms to help employees develop an appreciation

for diversity and to foster cooperation among culturally

diverse groups Most of these programs focus on

valuing, even celebrating, versity and the breadth

di-of thought and experiencethat results from diversework groups Some organiza-tions have implemented suchprograms because they feel it

is “politically correct” to do

so Many other organizations,however, have implementedaggressive diversity-trainingprograms because they be-lieve that a diverse workforceprovides a significant com-petitive advantage For exam-ple, companies such as All-state Insurance, Qwest, Avon,Wal-Mart, and General Elec-tric view diversity as a keystrategic tool for ensuringsuccess in the highly compet-itive markets.40

The globalization of ness will undoubtedly con-tinue to escalate Therefore, is-sues of diversity will continue

busi-to influence the thinking andbehaviors of managers

INTELLECTUAL CAPITAL

For most of the 20th century, the critical factors ofproduction were considered to be land, labor, and rawmaterials The job of managers was to use these produc-tion factors to create products that were more valuablethan the sum of their parts In the 21st century, intellec-tual capital is becoming a critical resource More andmore products will become intellectual, or knowledge-based (for example, investment services and advice, reg-istering for classes at a school, computer software), andmay be better referred to as services Services such astravel and entertainment are becoming more important,and they rely heavily on knowledge Even the traditionalproducts will make more use of knowledge in design,production, and marketing of them According to GaryHamel, a well-known consultant, we are now an “econ-omy of heads” rather than an “economy of hands.”41

What is intellectual capital? In general, intellectual

capital refers to the total of an organization’s

knowl-edge—what its people know, experiences, relationships,processes, discoveries, innovations, market presence, andcommunity influence.42Thomas Stewart, the author of

Intellectual Capital: The Wealth of New Organizations,43

provides a classification for knowledge assets The threemajor categories of intellectual capital are

• Structural capital: the accumulated knowledge and

know-how of the organization represented by itspatents, trademarks and copyrights, proprietarydatabases, and systems

• Customer capital: the value of established

relation-ships with customers and suppliers

• Human capital: the cumulative skills and knowledge

of the organization

14

Diversity

The heterogeneity of the

workforce, mostly in terms of

gender and race

The accumulated knowledge

of the organization represented

by its patents, trademarks and

copyrights, proprietary

data-bases, and systems

Customer capital

The value of established

rela-tionships with customers and

suppliers

Human capital

The cumulative skills and

knowledge of the organization

K E Y T E R M S

Diversity of gender and race in the workforce presents a challenge in reaching a consensus on common goals and the methods for achieving these goals.

Trang 38

Stewart and others contend that contemporary

organiza-tions must develop, measure, and manage these

intellec-tual assets if they are to be successful

The management of this overall knowledge, or

intel-lectual capital, is a critical strategic resource for

contem-porary organizations Managers must attract the right

people and manage them in a way that turns their

brain-power into profitable products and services Some

exam-ples of companies that are doing this are Amazon.com,

Dell, General Electric, Wal-Mart, and Southwest Airlines

ETHICS

Ethical behavior of managers continues to fill the news.

There are headlines in magazines and newspapers such as

“They Fought the Law: A Parade of Alleged Corporate

Wrongdoers Faced Their Accusers,”44“Former Charter

Executive Pleads Guilty,”45and “Businesses are Pushing

Against Requirements of Sarbanes-Oxley Act.”46The banes–Oxley Act is a relatively new law that is one of themore obvious remnants related to the questionable busi-ness practices that led to legal problems and charges ofunethical behavior of an unusually large number of top-level managers recently The law requires businesses to usecertain accounting rules that would prohibit the many fi-nancial abuses by managers that came to light in recentyears Surprisingly, some managers are resisting the re-quirements of the Sarbanes–Oxley Act, as the headlineabove suggests That may be one reason why stories con-tinue to fill the media about managers, especially themore notorious high-level

Sar-managers, who engaged inbehavior that most considerunethical and for which themanagers are being tried, orhave been tried, in court For

Five factors are identified in this

chapter as having special

impor-tance in the 21st century Many

organizations are engaged in all of

these areas, and here are some

no-table examples:

• Internet and Information

tech-nology e-Bay and Amazon.com

are prime examples of using the

Internet and information

technol-ogy because they are “Internet

companies.” Everything they do

is on the Internet Many

tradi-tional businesses also conduct

part of their business with the

help of the Internet (for example,

Wal-Mart and Starbucks) Most

organizations have a website.

• Increasing globalization

Essen-tially all automobile companies

operate on a global scale, from

selling vehicles in many

coun-tries, to having ownership and

partnership across the world:

DaimlerChrysler, a German and

U.S company; Renault-Nissan, in

France and Japan; Ford, who

owns Volvo, Land Rover, and

Jaguar, in European countries.

Avon Products markets its

products in many countries (see

“Leaders in Action”).

• Increasing diversity Of Avon’s

managers, 86% are women;

PepsiCo stresses diversity in its management ranks so that managers can understand markets in different countries; many companies, including Wal-Mart, General Electric, Denny’s Restaurants, and Allstate Insurance, have diversity-training programs.

• Intellectual capital All

compa-nies need to manage their knowledge to keep up in very competitive, fast-moving markets Some companies deal almost exclusively in knowledge, such as Expedia, Travelocity, and brokerage companies Others rely heavily on knowledge to deliver products and services, such

as Amazon.com and e-Bay.

• Ethics Ethical behavior of

man-agers and others in organizations has always been important Be- cause a notable and large number of unethical behavior has occurred in recent years, there is special attention on ethical

behavior Jeffrey Immelt is leading General Electric in becoming more aware so that it won’t sell products to people that might cause physical damage in the long run Salie Krawcheck, now chief financial officer at CitiBank, cleaned up practices of brokers that were considered unethical in the brokerage business as chief executive officer of Smith Barney, part of CitiBank Edward Breen took over as CEO at Tyco after Dennis Kozlowski was fired and was tried by the courts for larceny because of the large sums of company money that he allegedly used for his own purposes.

Sources: K Brooker, “It Took a Lady to Save

Avon,” Fortune, 15 October 2001, 158; J quinio, “Aging Gracefully at Avon,” Kiplinger’s

Tar-Personal Finance, September 2004, 49;

“eBay’s Secret,” Fortune, 18 October 2004,

161–178; “50 Most Powerful Women: Who’s

Up? Who’s Down?” Fortune, 18 October

2004, 181–198; H Hof, “The Wizard of Web

Retailing,” BusinessWeek, 20 December

2004, 18; “The Best & Worst Managers of the

Year,” BusinessWeek, 10 January 2005,

55–68.

Managing in the 21st Century

Trang 39

External Environment

Overall Strategy

Organizing, Leading Controlling

Overall Goals

Internal Environment

F i g u r e 1 5 An Overall Framework of Management

example, Martha Stewart finished her time in jail Facing

court cases are Bernard Ebbers, fired CEO of WorldCom—

now MCI; Richard Scrushy, fired CEO of HealthSouth;

Kenneth Lay and Jeffrey Skilling, both from the

now-ex-tinct company Enron; and others.47Former Tyco CEO,

Dennis Kozlowski, and former CFO, Mark Swartz, were

even charged with larceny for their lavish and alleged

per-sonal use of the company’s cash.48The Academy of

Man-agement Executive, a publication for both practitioners and

academics, published an issue devoted entirely to “Ethical

man-so far and to set the contextnot only for the rest of thisbook but also for how thiscourse fits in your overallstudy of business and organi-zations (Figure 1.5)

As we discussed earlier,the purpose of an organiza-

tion is to achieve its overall goals To do that effectivelyand efficiently, planning must be done to first establishthe overall goals and then to set the strategy to achievethe goals The planning includes understanding the mar-

kets and industry (external environment) and the

com-petencies, weaknesses, and operations inside the

organi-zation (The arrows suggest interactions between thesefactors; the broken line suggests an indirect relationship.)Understanding these things is necessary to establish ap-propriate goals and strategy (This is discussed later inmore depth in the strategy and planning chapters.)Understanding the competencies, weaknesses, andoperations inside of the organization or inside the de-partment for managers other than the chief executiveofficer, is what organizing and leading are all about

A manager needs to understand the state of tional design; authority and responsibility; reportingrelationships, communication, human behavior, andleadership in the organization; how they interact witheach other; and how they all must support the overallstrategy Consequently, other chapters in this book dis-cuss these topics

organiza-The other courses that you are studying also arepart of the analysis of the external and internal environ-ments of organizations For example, here is where amanager uses knowledge of such things as economics,political science, government, and sociology to judgethe nature of the overall organizational environment.Other courses and disciplines, such as finance, market-ing, production, and computer information systems/information technology, provide knowledge that isneeded to assess the competencies, weaknesses, and op-erations inside the organization A manager uses knowl-

An Overall Framework

External environment

The setting in which an

orga-nization operates; the

mar-kets and industry

Competencies

The things that an

organiza-tion can do well; the skills

and abilities

K E Y T E R M S

Trang 40

edge from all these other areas in carrying out the basic

functions of management: planning, organizing,

lead-ing, and controlling

Because the purpose of an organization is to

achieve an overall goal or goals, everything that

is done in the organization must be evaluated and guided

so that it is all directed to achieving the overall goal This

is the overall definition of control While some

proce-dures need to be established to ensure an overall control

system (discussed in Chapter 15 on control), many of its

components are parts of the other operations in the

or-ganization For example, job descriptions, authority and

responsibility, influence of the manager as leader,

com-munications, and motivation all guide, monitor, and

re-ward what is accomplished

Finally, analysis that goes into understanding all

parts of the organization and its environment and

over-all control require feedback in order to understand

consequences of what has been done so far If the

con-sequences are positive, then the managers in an

or-ganization can continue to do what they are doing The

feedback will also help them understand why things

worked well If the consequences are negative, that needs

to be known so that corrective action can be taken The

arrows in Figure 1.5, including the larger arrows pointing

back, indicate the necessity of feedback

Overall, this framework will help you understand

how all the other courses that you take relate to the

func-tions of management Also, the framework indicates how

the functions of management all interact with each other,

and together they lead to effective and efficient

achieve-ment of an organization’s overall goals

The ideas discussed in this chapter and those that

will be discussed in the remaining chapters are

useful ideas for managers But what if you are not a

man-ager or are not thinking about being one? Let’s discuss

the reasons why it is important for everyone to study

management

For those of you who are managers or want to be

managers, it is reasonable to say that it is important to

learn about management The basic functions that

managers perform, the roles that managers play, and the

skills that managers use are universal They apply to the

management of all organizations, fromStarbucks to Dell Computer Co., from theNew England Patriots football team to aNASCAR race, from your local church tostate government, from your university tothe student group of which you are thepresident or other officer The details andthe types and levels of roles and skills usedacross these organizations vary, but thebasics apply The basics are contained

in planning, organizing, leading, and trolling

con-It is relatively easy to see how the aboveapplies to top-level managers However,what if you are or want to be a middle man-ager of a first-line manager, and that is thelevel at which you want to stay? The samequestion applies to all top-level managers as they movethrough these levels on their way to the top Certainly, de-tails of what a marketing manager or an accounting man-ager does vary, but again, the same basics apply A first-line production manager at a factory also uses planning,organizing, leading, and controlling, just as do the nightmanager at the convenience store and the organizer of asoftball league

Okay, what if you do not plan on being a manager?

First, chances are very high, almost 100%, that even

in your first job, no matter what that is, you will berequired to do some planning You probably will also

be required—or at the least, find it very useful—toengage in organizing and perhaps controlling Althoughyou may think it quite unlikely, you probably verysoon will be supervising one or more peo-

ple, calling for leading skills Even if you donot consider official jobs, everyone is amember of some type of informalorganization, such as a sorority, fraternity,softball league, and so on These organiza-tions also need to be managed and will ben-efit from applying management principles

The conclusion is that management isuniversal The basic functions—planning,organizing, leading, and controlling—arerequired in every organization Of course,the details of the roles that managers play,the skills that managers need, and thespecifics tools that managers

use vary across types of nizations, levels of managers,types of managers, and spe-cific situations However,the basic functions are thesame, so it is useful to studymanagement

7

L E A R N I N G

O B J E C T I V E

Explain why it is important to study management.

K E Y T E R M S

17

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