Importance of managers :

- Organizations need their skills in uncertain times

- Managerial skills are critical in getting things done

The quality of the relationship between employee and supervisor is an important variable in
productivity

Top managers: making wide decisions /

establishing plans and goals
Manager :
Someone who coordinates
middle managers: manage the work of
and oversees the work of
first line managers
other ppl to accomplish
goals
First line managers: manage the work of
non-managerial employees

Managers work in organizations → arrangement of ppl to accomplish a purpose

Characteristics : distinct purpose (expressed through goals)

Composed of people
Deliberate structure (job arrangement)

Management involves coordinating and overseeing the work activities of others so

that the activities are completes efficiently ( getting the most output for the least
input) and effectively ( attaining goals)

Planning: defining goals/ establish strategies/

integrate and coordinate activities

Organizing: structuring work to accomplish

Leading : working with and through people to

Management functions accomplish goals

Controlling : monitoring, comparing, correcting

 Interpersonal roles : how a manager interact with ppl
a) Figurehead : modeling policies for the employees
b) Leader : providing direction and enthusiasm
Roles of mangers c) Liaison : coordinate with other units
(MINTZBERG)
Informational roles : how a manger exchanges and
processes information
a) Monitor: gather information and analyze it
b) Disseminator: give instructions and directions
c) Spokesperson: official communicator (outside)

Decision roles: how a manger uses information in decision

making
a) Entrepreneur: guide the company to new initiatives
b) Disturbance handler
c) Resource allocator
d) Negotiator

Skills managers need :

1) Technical skills : knowledge, expertise, techniques
2) Human skills : the ability to work with other people
3) Conceptual skills : think and conceptualize about abstract
situations
Changes facing Managers :

Importance of customers: without clients the organization wouldn’t exist. Consistent high
quality customer service is essential.

Importance of social media : managers who actively make use of social media have
increases in performance

Importance of innovation : Innovation means doing things differently, exploring new

territory, and taking risks

Importance of sustainability : company’s ability to achieve its business goals and increase
long-term shareholder value by integrating economic, environmental, and social
opportunities into its business strategies

Why we study management ?

management is needed in all types and sizes of organizations, at all organizational levels and
in all organizational work areas, and in all organizations

Challenges of being a manager : thankless/ clerical duties/ time consuming/ dealing with diff
personalities/ limited resources.

Rewards of being a manager: helping others/ use your imagination/ meet variety of ppl/
recognition and status/ influencing organizational outcomes/ attractive compensations (
salary, bonus, stock option)
 • GLOBAL PERSPECTIVES:

• Ethnocentric Attitude – the parochialistic belief ( viewing the world solely through
your own perspectives, leading to an inability to recognize differences between
people ) that the best work approaches and practices are those of the home country.

• Polycentric attitude – the view that the managers in the host country know the best
work approaches and practices for running their business.

• Geocentric Attitude – a world-oriented view that focuses on using the best

approaches and people from around the globe.

Multinational corporation : international companies that maintain operations in multiple

countries.

a) multidomestic corporation, which decentralizes management and other decisions to

the local country. This type of globalization reflects the polycentric attitude

b) global company, which centralizes its management and other decisions in the home
country. This approach to globalization reflects the ethnocentric attitude

c) transnational, or borderless organization and reflects a geocentric attitude

HOW ORGANIZATIONS GO GLOBAL :

1) global sourcing : purchasing materials from around the world

2) exporting : making products domestically and selling them abroad
3) importing : acquiring products made abroad and selling them domestically
4) licensing: give the right to make or sell its product
5) franchising: give the right to use its name
6) strategic alliance : a partnership between the organization and a foreign company
7) joint venture: partners agree to form a separate independent organization
8) foreign subsidiary: directly investing in a foreign country by setting up a separate
facility
 • European Union (EU) – a union of 28 democratic European nations created as a
unified economic and trade entity with the Euro as a single common currency.

• North American Free Trade Agreement (NAFTA) – an agreement among the

Mexican, Canadian, and U.S. governments in which certain barriers to trade have
been eliminated.

• Association of Southeast Asian Nations (ASEAN) – a trading alliance of 10 Southeast

Asian nations.

• World Trade Organization (WTO) – a global organization of 153 countries that deals
with the rules of trade among nations.

• International Monetary Fund (IMF) – an organization of 185 countries that promotes

international monetary cooperation and provides advice, loans, and technical
assistance.

• World Bank Group – a group of five closely associated institutions that provides
financial and technical assistance to developing countries.

• Organization for Economic Cooperation and Development (OECD) – an international

economic organization that helps its 30 member countries achieve sustainable
economic growth and employment.

The political/legal environment :

– U.S. managers are accustomed to a stable legal and political system

– Managers must stay informed of the specific laws in countries where they do
business
– Some countries have risky political climates

The economic environment :

1) Free Market Economy – an economic system in which resources are primarily owned
and controlled by the private sector.

2) Planned Economy – an economic system in which economic decisions are planned by

a central government

The cultural environment :

National Culture – the values and attitudes shared by individuals from a specific country that
shape their behavior and beliefs about what is important
We might use Hofstede’s framework for assessing cultures ( individualistic or collectivistic/
power distance/ uncertainty avoidance/ values relationship or achievement/ value the past
or the future)

• Global Leadership and Organizational Behavior Effectiveness (GLOBE) program – a

research program that studies cross-cultural leadership behaviors.

Challenge of openness:
a) Terrorism
b) Economic interdependence
c) Cultural differences

- managers need cultural intelligence or cultural awareness and sensitivity skills

- global leaders need is a global mind-set, attributes that allow a leader to be effective
in cross-cultural environments.
Planning: defining goals/ establish strategies/ integrate and coordinate activities
a) strategic plans: plans that apply to the entire organization
b) operational plans : encompass a particular area of the organization
c) long term plans: beyond three years
d) short term plans: one year or less
e) specific plans: clearly defined and don’t need interpretation
f) directional plans : flexible and set out general guideline
g) single-use plan: a one-time plan for a unique situation
h) standing plans: provide guidance for activities performed repeatedly

Formal planning
– Specific goals covering a specific time period
– Written and shared with organizational members

WHY DO MANAGERS PLAN ?

1) provides direction to mangers and non-managers

2) reduces uncertainty
3) minimizes waste and redundancy
4) sets the standards for controlling

Associated with : positive financial results/ planning affects performance/ external

environment can reduce the impact of planning/ planning-performance relationship seems
to be influenced by the planning time frame

Goals : desired outcomes or targets

a) financial goals : expected internal financial performance
b) strategic goals: related to the performance relative to external factors
c) stated goals: official statement
d) real goals: goals actually pursued

APPROACHES TO SETTING GOALS:

1) traditional goal setting: top managers set goals that flow down through the
organization
2) means ends chain: accomplishment at one level serves as the means to achieve goals
at the next level
3) Management by objectives: setting mutually agreed upon goals

Steps in goal setting:

- Review the mission or purpose of the organization

- Evaluate available resources
- Determine the goals
- Write down the goals and communicate them
- Review results and if goals are met
Commitment Concept: Current plans affecting future commitments must be
sufficiently long-term in order to meet those commitments.

Environmental Uncertainty

– When uncertainty is high, plans should be specific, but flexible.

– Managers must be prepared to change or amend plans as they’re

implemented.

– At times, they may even have to abandon the plans.

APPROACHES TO PLANNING:

Formal planning department – a group of planning specialists whose sole

responsibility is helping to write organizational plans.

Managers need to recognize that planning is an ongoing process.

Environmental scanning – screening information to detect emerging trends.

Competitor intelligence – gathering information about competitors that allows

managers to anticipate competitors’ actions rather than merely reacting to them.
Decision : making a choice from two or more alternatives

Decision making methods( ROI, NPV, PBP, IRR )

Decision making process: ( Car example p 20)

1) Identifying a problem
2) Identifying criteria
3) Allocating weights to the criteria
4) Developing alternatives
5) Analyzing alternatives
6) Selecting an alternatives
7) Implementing the alternative
8) Evaluating effectiveness

Another process ( pros and cons p26)

Nominal Group technique:

1) Present goals
2) Generate alternatives (individually)
3) Record the alternatives (group)
4) Consolidate alternatives ( group)
5) Rank the alternatives ( individually)
6) Vote ( group)

Other decision making methods:

+ Devil’s advocate : assign someone with expertise and experience (helpful at step 5)

The advocate must :

challenge group assumptions.
Question alternatives
Provide alternative perspectives

Rational decision making:

Choices that are logical and consistent while maximizing value
Bounded rationality: rational but limited by an individual’s ability to process information
Escalation of commitment : a commitment to a previous decision despite evidence it may
have been wrong
Intuitive decision making : on the basis of experience, feelings and accumulated judgment
Evidence based management: use the best available evidence to improve management
practice
Essential elements to ebmgt:
1) Decision maker’s expertise and judgment
2) External evidence
3) Opinions, preferences of those who have a stake in the decision
4) Internal factors

Structured problems: straightforward, familiar and easily defined problems

Programmed decision : repetitive decision handled by a routine

3 types of programmed decisions:

Procedure: sequential steps used to respond a well-structured problem

Rule: statement that tells managers what can or cannot be done
Policy: guideline for making decisions

Unstructured Problems–problems that are new or unusual and for which

information is ambiguous or incomplete.

Nonprogrammed decisions – unique and nonrecurring and involve custom made

solutions.

DECISION MAKING CONDITIONS:

Certainty: accurate decisions

Risk : estimate the likelihood of certain outcomes

Uncertainty: neither certainty nor reasonable probability

- CALCULATING THE EXPECTED VALUE ( from 52 to 71)

Maximax : maximizing the maximum possible payoff

Maximin: maximizing the minimum possible payoff

To minimize the maximum regret we will opt for minimax choice

Linear thinking style : tendency to use external data
Nonlinear thinking style : use internal sources of information

DECISION MAKING BIASES AND ERRORS :