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MANAGEMENT 339: PRINCIPLES OF MANAGEMENT AND OPERATIONS
• What are the levels of the organization ?– Corporate; Business; Functional. Page 130; Pg 151
• What are levels of managers/management ?– Top management, middle management,
entry-level/first-level/supervisory Page 20
• What are Principles of Management ?– Principles applicable to all functions of the organization
– Principles applicable at all levels of the organization
– Principles useful to all managers
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MANAGEMENTWhat all managers do
Page 12
1. Achieving Objectives/Goals
2. Functions/Process of Management
3. Efficient Use of Resources
4. Managing organizational change
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MANAGEMENT
Definition: Pg 5• Goal/objective directed
• A process involving management functions
• Resources: assembling and using
• Setting: –Organizational - functions, people, coordination
–External environment
How good is our management ?
Effectiveness: Achieving objectives, goals
Efficiency: Managing resources
OUTPUT INPUT
4
5
Efficiency
Team A Team B Target
Tickets
Sold
200 150 250
$ Spent 100 50
Efficiency 200/100 150/50
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Function of ManagementPg 12 -
Planning
Organizing
Directing
Control
Process of Management
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Planning at Different Levels of Management
TOP
MIDDLE
FIRST
LEVEL
Planning
Horizon
Long
Medium
Short
Planning
Type
Strategic
Tactical
Operational
Skills (pg 20)
Conceptual
Human
Technical
WHAT IS OPERATIONS MANAGEMENT ? OM Chapter 1
• What is Operations Management (OM) ?– Activities that relate to creation of goods and services
through transformation of inputs– Relationship to other functional areas such as Marketing
and Accounting Finance– Key areas in OM
• Product/Service design/Process design/Capacity planning/facilities location and design (Layout)/Quality management/HR and job
design/Supply chain management/Inventory and materials management/Operations planning and scheduling/Maintenance
• We will learn principles/methods to handle issues in these areas
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KEY CONCEPTS IN OMOM Chapter 1
• Process view OM chapter 1; pg. 5
• Supply chain view. Pg 7
• Operations Strategy: Areas for making long term plans in operations
PRODUCTS/SERVICES
PROCESS
TECHNOLOGY
QUALITY
WORK FORCE
FACILITIES
SUPPLIERS/VERTICAL INTEGRATION
• Productivity Pg 19
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Contemporary Challenges in Management and OM Pg 6-
• Technological changes• Globalization • Growth of service sector• Emphasis on quality and productivity
– TQM and JIT philosophies• Social responsibility and ethics• Emphasis on integration, coordination using IT:
SCM
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Social Responsibility and Ethics
• Why relevant to business studies• SR: obligation of an organization’s management to make
decisions and take actions that will enhance the welfare and interests of society as well as the organization
• Ethics: The code of moral principles and values that govern the behavior of a person or group with respect to what is right or wrong.
• Economic, legal, ethical and discretionary responsibilities• What organizations can do: • Leadership, code of ethics, Values statements, compliance
committees/officers, policies (e.g. whistle-blowing), training, a corporate culture
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An Overview of Planning Chapter 6
• Purpose– Direction, standards for measurement
• Types of plansStrategic, Tactical and Operational 146
• Planning process Pg 151
• Setting Objectives/Goals. 161– Principles: 161-– Specific, Measurable, Realistic but challenging, Participation,
Timely– Tools: Budgets
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Strategic Management. Chapter 5
• Objective: Competitive advantage
• Characteristics of competitive advantage. 116-– Superiority, inimitability, rarity, durability, non-substitutability,
appropriate levels of profits/gains
• Strategic Management process 118-– Strategic Intent/Vision/Mission
– Environmental Analysis
– Revised Vision/Mission and LT objectives
– Detailed situation analysis
– Formulate strategies
– Develop action for implementation: Programs, Policies, Budgets
– Plan monitoring
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ENVIRONMENTAL SCANNING 119-: EXTERNAL ENVIRONMENT
• ECONOMY
• POLITICAL-LEGAL
• SOCIO-CULTURAL
• TECHNOLOGY
• GLOBAL/INTERNATIONAL
• COMPETITION – Porter’s industry competition analysis 123- ; 126
• CUSTOMERS
• SUPPLIERS
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INTERNAL ENVIRONMENT
• FUNCTIONAL AREA RESOURCES– Finance, Marketing, Operations, HR, MIS, R&D
• ORGANIZATION STRUCTURE– Dividing work, Authority & Responsibility,
Information flow, decision making
• CORPORATE CULTURE– Social responsibility and ethics, integration and
intensity of competitive priorities
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STRATEGIC MANAGEMENTFORMULATING STRATEGY
EXT. ENVT.
INT. ENVT.
MISSION
OBJECTIVES
SITUATION
ANALYSIS
STRATEGY
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SITUATION ANALYSIS
1. SWOT ANALYSIS. 129
2. PORTFOLIO ANALYSIS.
3. PRODUCT LIFE CYCLE ANALYSIS
4. INDUSTRY/ COMPETITION ANALYSIS – See previous discussion
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STRATEGY
CORPORATE LEVEL(GRAND)
GROWTH STABILITY RETIREMENT
BUSINESS LEVEL: 131
COST LEADERSHIP DIFFERENTIATION
FOCUS
FUNCTIONAL LEVEL:
OPERATIONS STRATEGY
“Competitive Priorities”: Cost/Price Quality Availability Dependability OM Chap 1 Pg 14
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GROWTH STRATEGIES
CONCENTRATION
DIVERSIFICATION
VERTICAL INTEGRATION
ACQUISITIONS & MERGERS
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STRATEGY IMPLEMENTATIONPg 136-
• Organizing and Directing view
• Policies/procedures, Programs and Budgets view
• What are policies? Why important here?
• Programs are MT and ST plans
– Elements
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MANAGEMENT CONTROLChapter 14
The systematic process through which managers regulate
organizational activities to make them consistent with expectations established in plans, targets, and
standards of performance.
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MANAGEMENT CONTROLSteps 402-
SETTING STANDARDS
MEASURING ACTUAL PERFORMANCE
COMPARISON ANALYSIS
CORRECTIVE ACTION/ NO ACTION
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Scope and Stages of Management Control 407-
• Control at all levels: strategic, tactical and operational
• Preliminary control• Concurrent control• Post/Feedback control• Examples of control: quality control, process
control, employee evaluations, customer satisfaction surveys, supplier evaluations
24
Principles of Effective Control419-
• Focus
• Amount of
• Quality of information
• Flexibility
• Timeliness