Spring 2007Introduction to Organizations and Management1.

Spring 2007 Introduction to Organizations and Management 1

Introduction to Organizations and Management


What is an Organization ?

• “A deliberate arrangement of people to accomplish some specific purpose”

• “A social entity that is a goal directed, deliberately structured activity system within an identifiable boundary”

• “The planned coordination of the activities of a number of people for the achievement of some common, explicit purpose or goal, through division of labor and function, and through a hierarchy of authority and responsibility”


DistinctPurpose

People

DeliberateStructure

Common Elements

• People

• Goals

• Inside boundaries

• Within an environment

• Structured


Importance of Organizations

• Why do we study organizations?• Organizations are essential to all human social

functioning, so we want to...• ...explain their birth, growth, adaptation, and death

• People are essential, but organizations exist independently of particular people• Organization = a legal person• Written records, memory

• The social organization or informal organization• Elements of formal organization are present, but it is

not rationally planned and coordinated


Who Owns the Organization?

• For-profit organizations• Examples: Federal Express, Google, Joe’s

Bait Shop

• Not-for-profits• Government – the voters• Foundations, schools, hospitals, helping

organizations - trustees

Stakeholders


For-Profit Organizations

• Ownership can vary:• Single proprietor

• Partnership

• Private corporations

• Public corporations

• Why does it matter?• Legalities

• Organization life and succession

• Stakeholders

Single Individual Numerous Shareholders


Efficiency vs. Effectiveness

• Defined:• Efficiency is making the best use of

resources• Effectiveness is achieving the goal

• Questions….• Can you be efficient without being effective?• Can you be effective without being efficient?


Systems Theory and Organization Effectiveness

• How well the organization manages the interaction between internal and external environments

• Three basic principles:• Organizations must have inputs to survive (or face

entropy)• One system’s output is another system’s input, and

vice versa• Organizations must respond to feedback (remain

open, not closed)


Systems Theory

• 5 related components:• Input• Transformation process• Output• External environment• Feedback

• Synergy

• Equilibrium


Environment

OutputOutput

InputInput

Transformation

ProcessFeed

back

Systems Model


Every System is Made up of Subsystems

• One view:• Boundary spanning• Production• Maintenance• Adaptation• Management

• Another view• Technical• Structural• Psychosocial• Managerial


Systems Theory and Organization Effectiveness

• How well the organization manages the interaction between internal and external environments

• Three basic principles:1. Organizations must have inputs to survive (or face

entropy)

2. One system’s output is another system’s input, and vice versa

3. Organizations must respond to feedback (remain open, not closed)


Contingency Theory

• There is no “One Best Way” to manage organizations and people

• Every situation has different requirements


What is Management?

• A universal activity that uses resources to attain organizational goals in an effective and efficient manner through planning, organizing, leading, and controlling organizational resources

• Getting work done through other people• A manager integrates and coordinates the work of other

people• A manager:

• “Decides the purpose and mission of the organization”• “Makes work productive“• “Manages social impacts and responsibilities”


Perspectives on Management

• Management is a process• Functions and activities performed by managers

• Management is a discipline• An accumulated body of knowledge that can be

learned

• Management is a human activity• Performed by people

• Management is a career• A progression of positions held by an individual


A Management Paradox

• A manager oversees the work of others; she does not attend to the details herself

• At the same time, the manager must be concerned with the details, to be sure they are covered.


Traditional Management Functions

ManagementFunctions

Planning

Leading

OrganizingControlling


The Management Process

PlanningSelect goals and

ways to attain them

PlanningSelect goals and

ways to attain them

OrganizingAssign responsibility

for task accomplishment

OrganizingAssign responsibility

for task accomplishment

LeadingUse influence to

motivate employees

LeadingUse influence to

motivate employees

ControllingMonitor activities

and make corrections

ControllingMonitor activities

and make corrections


Who Are The Managers?

• Department of Labor: 9.56% of workforce• First-line supervisors: 4.89% (avg. salary $43,090)• Managers: 4.68% (avg. salary $84,258)

• Census Bureau: 34.14% of employed population in managerial, professional, and related occupations• Male: 49.68%• Female: 50.31%

• Why ?• Lack of consistent definitions• People may have multiple duties


2004’s Highest Paid CEOs

CEO Company $ Thousand

Reuben Mark Colgate-Palmolive 147,970

George David United Technologies 70,527

Richard S. Fuld, Jr Lehman Bros Holdings 67,682

Henry R. Silverman Cendant 60,023

Dwight C. Schar NVR 58,105

Lawrence J. Ellison Oracle 40,589

Richard M. Kovacevich Wells Fargo 37,842

Howard Solomon Forest Labs 36,089

James E. Cayne Bear Stearns Cos 33,925

Todd S. Nelson Apollo-Education Group 32,812

Source: www.Forbes.com


Levels of Management

Title What They Do Typical TitlesFirst-Line Manager

Directly supervises the work of others

Supervisor; Office Manager; Foreman; Team Leader

Middle Manager Supervises the work of other managers

Department Manager; Plant Manager; Director

Top Management or Senior Management

Responsible for performance of entire organization

Chief Executive Officer (CEO); Chief Financial Officer (CFO); Chief Information Officer (CIO); President; Vice President


Management Competencies

Conceptual Human Technical

TopManagers

MiddleManagers

First-lineManagers


Typical Responsibilities: Top Management

• Set organization goals• Define strategies• Monitor & interpret external environment• Make decisions that impact entire organization

• Communicate a shared vision• Shape corporate culture• Nurture entrepreneurial spirit• Engage the unique skills and knowledge of employees


Middle & First-Line Management

• Middle managers:• Implement strategies and policies defined by top

management• Monitor operations for short-term outcomes• Establish and maintain good relationships with peers• Encourage teamwork and resolve conflicts

• First-line managers / supervisors• Apply rules and procedures to achieve efficient

production on a day-to-day basis• Provide technical assistance to subordinates• Motivate subordinates


Management Functions by Level

15%

18%

28%

24%

33%

36%

51%

36%

22%

10%

13%

14%

0% 20% 40% 60% 80% 100%

First LineSupervisors

Middle Managers

Top Managers

Planning Organizing Leading Controlling


Managers in Two Dimensions

• Vertical• Management level

• Horizontal• Function within the organization

• Line vs. staff

• Common to all: fast-paced, fragmented


Mintzberg’s Management Roles

Who is aManager?

•Entrepreneur•Disturbance handler•Resource allocator•Negotiator

Decisional Roles

•Monitor•Disseminator•Spokesperson

Informational Roles

•Figurehead•Leader•Liaison

Interpersonal Roles

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