CHAPTER 1: MANAGEMENT FUNDAMENTALS

© John Wiley & Sons Canada, Ltd.

Business Leadership: Management FundamentalsJohn R. Schermerhorn, Jr., Barry Wright, and Lorie Guest

o Understand the current workplace environment in Canada

o Identify the characteristics of an organization

o Understand who managers are and what they do

o Describe the management process and how managerial skills and competencies are learned

PLANNING AHEAD —

CHAPTER 1 LEARNING

GOALS

OVERVIEW OF THE NEW WORKPLACE

• The dynamics of ever-present change extend into the workplace and raise a host of new career challenges.

• Smart people commit their energies and intellect to continuous learning and personal development.

• Companies with a future are committed to people.• Companies with a future offer inspirational

leadership and rewards, respect people, and provide supportive work environments.

• High performing companies gain extraordinary results from people.

• Talent• Diversity• Globalization• Technology• Ethics• Careers

WORKING TODAY

• People and their talents are the ultimate foundations of organizational performance.

• Intellectual capital is the collective brainpower or shared knowledge of a workforce that can be used to create value.

• A knowledgeable worker’s mind is a critical asset to employers and adds to the intellectual capital of an organization.

TALENT

• Workforce diversity reflects differences with respect to gender, age, race, ethnicity, religion, sexual orientation, and able-bodiedness.

• A diverse and multicultural workforce both challenges and offers opportunities to employers.

• Many call diversity a “business imperative” and view it as an asset.

DIVERSITY

• How diversity bias can occur in the workplace:– Prejudice: the display of negative, irrational

attitudes toward members of a diverse population.

– Discrimination: actively denies minority members the full benefits of organizational membership.

– Glass ceiling effect: an invisible barrier limiting career advancement of women and minorities.

DIVERSITY (CONT’D)

VIDEO: A SCIENCE GLASS CEILING- GLOBE & MAIL

A Science Glass Ceiling

(external link)

• National boundaries of world business have largely disappeared.

• Globalization is the worldwide interdependence of resource flows, product markets, and business competition that characterize the new economy.

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GLOBALIZATION

• Continuing transformation of the modern workplace through:- The Internet- World Wide Web- Computer networking- Information technology- Telecommuting/virtual teaming/mobile offices

• Increasing demand for knowledge workers with the skills to fully use technology.

TECHNOLOGY

Social Media Revolution by Erik Qualman(external link)

VIDEO: SOCIAL MEDIA REVOLUTION

• Ethics- Code of moral principles that set standards of

conduct of what is good and right• Ethical expectations for modern businesses:

- Integrity and ethical leadership at all levels- Sustainable development- Natural environment protection- Consumer protection- Human rights

ETHICS

• Core workers, contract workers, and part-time workers

• People must be prepared to be any one of these types of workers

• People must make sure that their skills are portable and of current value in employment markets

CAREERS

• Critical skills for success in the new workplace – Mastery– Networking– Entrepreneurship– Love of technology– Marketing– Passion for renewal

EARLY CAREER SURVIVAL SKILLS

• A collection of people working together to

achieve a common purpose

• Organizations provide useful goods and/or

services that return value to society and satisfy

customer needs

WHAT IS AN ORGANIZATION?

• Organizations are open systems– Composed of interrelated parts that function

together to achieve a common purpose– Interact with their environments– Transform resource inputs into product outputs

(goods and services)– Environmental feedback tells organization how

well it is meeting the needs of customers and society

ORGANIZATIONS (CONT’D)

FIGURE 1.3 ORGANIZATIONS AS OPEN SYSTEMS

• Organizational performance– “Value creation” is a very important notion for

organizations– Value is created when an organization’s

operations adds value to the original cost of resource inputs

– When value creation occurs:• Businesses earn a profit• Nonprofit organizations add wealth to society

© John Wiley & Sons Canada Ltd.

ORGANIZATIONS (CONT’D)

• Productivity- An overall measure of the quantity and quality

of outputs relative to the cost of inputs• Performance effectiveness

- An output measure of task or goal accomplishment

• Performance efficiency- An input measure of the resource costs

associated with goal accomplishment

ORGANIZATIONAL PERFORMANCE

FIGURE 1.4 PRODUCTIVITY AND THE DIMENSIONS OF ORGANIZATIONAL

PERFORMANCE

• Workplace changes that provide a context for studying management: – Renewed belief in employees– Disappearance of “command-and-control”– Emphasis on teamwork– Prominence of technology – Embrace of networking– New workforce expectations– Concern for work-life balance– Focus on speed

CHANGING NATURE OF ORGANIZATIONS

• Importance of human resources and managers

– People are not ‘costs to be controlled.’

– High performing organizations treat people as valuable strategic assets.

– Managers must ensure that people are treated as strategic assets.

MANAGERS IN THE NEW WORKPLACE

• Directly support and help activate the work efforts and performance accomplishments of others

• The people who managers help are the ones whose tasks represent the real work of the organization

MANAGERS

• Top managers: responsible for the performance of an organization as a whole or for one of its larger parts

• Middle managers: in charge of relatively large departments or divisions

• Team leaders or supervisors: in charge of a small work group of non-managerial workers

LEVELS OF MANAGEMENT

FIGURE 1.5 MANAGEMENT LEVELS IN A TYPICAL BUSINESS AND NON-PROFIT

ORGANIZATIONS

• Plan meetings and work schedules• Clarify goals and tasks, and gather ideas for

improvement• Appraise performance and counsel team

members• Recommend pay raises and new assignments• Recruit, train, and develop team members• Plan meetings and work schedules• Clarify goals and tasks, and gather ideas for

improvement• Appraise performance and counsel team

members• Recommend pay raises and new assignments• Recruit, train, and develop team members

RESPONSIBILITIES OF TEAM LEADERS

• Line managers: are responsible for work activities that directly affect organization’s outputs

• Staff managers: use technical expertise to advise and support the efforts of line workers

• Functional managers: are responsible for a single area of activity

• General managers: are responsible for more complex units that include many functional areas

• Administrators: work in public and nonprofit organizations

TYPES OF MANAGERS

• In order to attain sustainable high performance, organizations use resources effectively to accomplish missions and objectives.- The Systems Resource Approach focuses

on resource acquisition- The Internal Process Approach focuses on

operations efficiency- The Goal Approach focuses on accomplishing

key objectives- Strategic Constituencies focus on

stakeholder impact

ORGANIZATIONAL EFFECTIVENESS

• Accountability is the requirement of one person to answer to a higher authority for relevant performance results.

• Effective managers fulfill performance accountability by helping others to achieve high performance outcomes and experience satisfaction in their work.

MANAGERIAL PERFORMANCE

• Quality of work life (QWL)– An indicator of the overall quality of human

experiences in the workplace– QWL indicators:• Fair pay• Safe working conditions• Opportunities to learn and use new skills• Room to grow and progress in a career• Protection of individual rights• Pride in work itself and in the organization

MANAGERIAL PERFORMANCE (CONT’D)

• Are well informed of their team’s needs

• Work alongside those they supervise

• Provide advice and develop support for their

team

• Help others perform to the best of their abilities

HIGH PERFORMING MANAGERS

• Reflects the changing nature of work today

• A manager’s job is to support workers’ efforts

• Whole organization is devoted to serving the customer

THE ORGANIZATION AS AN UPSIDE-DOWN PYRAMID

FIGURE 1.6 – THE ORGANIZATION AS AN UPSIDE-DOWN PYRAMID

• Managers achieve high performance for their organizations by best utilizing its human and material resources.

• Management is the process of planning, organizing, leading, and controlling the use of resources to accomplish performance goals.

• All managers are responsible for the four functions.• The functions are carried on continually.

MANAGEMENT PROCESS

FIGURE 1.7 THE FOUR FUNCTIONS OF MANAGEMENT

• Planning:

- The process of setting objectives and determining what actions should be taken to accomplish them

• Organizing:

- The process of assigning tasks, allocating resources, and arranging the coordinated activities of individuals and groups to implement plans

FUNCTIONS OF MANAGEMENT

• Leading:- The process of arousing people’s enthusiasm

to work hard and direct their efforts to fulfill plans and accomplish objectives

• Controlling:- The process of measuring work performance,

comparing results to objectives, and taking corrective action as needed

FUNCTIONS OF MANAGEMENT (CONT’D)

• Informational roles:- Involves giving, receiving, and analyzing

information• Interpersonal roles:

- Involves interactions with persons inside and outside the work unit

• Decisional roles:- Involves using information to make decisions,

solve problems, or address opportunities

MANAGERIAL ROLES AND ACTIVITIES

FIGURE 1.8 MINTZBERG’S 10 MANAGERIAL ROLES

• Managers work long hours• Managers work at an intense pace• Managers work at fragmented and varied tasks• Managers work with many communications

media• Managers work largely through interpersonal

relationships

CHARACTERISTICS OF MANAGERIAL WORK

• Agenda setting- Development of action priorities for one’s job- Include goals and plans that span long and short

time frames• Networking

- Process of building and maintaining positive relationships with people whose help may be needed to implement one’s work agendas

• Social Capital- Capacity to attract support and help from others in

order to get things done

MANAGERIAL AGENDAS AND NETWORKS

• Learning- The change in a behaviour that results from

experience• Lifelong learning– The process of continuously learning from daily

experiences and opportunities• Career success depends on real commitment

to learning• Not just formal classroom learning

ESSENTIAL MANAGERIAL SKILLS

• Skill: the ability to translate knowledge into action that results in desired performance

• Technical skill: the ability to apply a special proficiency or expertise to perform particular tasks

• Human or interpersonal skill: the ability to work well in cooperation with others

- Emotional intelligence is the ability to manage ourselves and relationships effectively

• Conceptual skill: the ability to think critically and analytically to solve complex problems

ESSENTIAL MANAGERIAL SKILLS (CONT’D)

FIGURE 1.9 KATZ’S ESSENTIAL MANAGERIAL SKILLS

• A skill-based capability that contributes to high performance in a management job

MANAGERIAL COMPETENCY

• Communication

• Teamwork

• Self-management

• Leadership

• Critical thinking

• Professionalism

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COMPETENCIES FOR MANAGERIAL SUCCESS

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