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What is management?
Getting work done through others
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Efficiency
getting work done with a minimum of effort, expense, or waste
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Process of Managing
plan to get things done, organize the company to be efficient and effective, lead and motivate employees, and put controls in place to make sure our plans are followed and our goals me
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Management Functions
- planning
- organizing
- leading
- controlling
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Planning
involves determining organizational goals and a means for achieving them.
one of the best ways to improve performance.
It encourages people to work harder, to work hard for extended periods, to engage in behaviors directly related to goal accomplishment, and to think of better ways to do their jobs.
companies that plan have larger profits and faster growth
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Organizing
deciding where decisions will be made, who will do what jobs and tasks, and who will work for whom in the company
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Leading
involves inspiring and motivating workers to work hard to achieve organizational goals
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Controlling
monitoring progress toward goal achievement and taking corrective action when progress isn't being made
basic control process involves setting standards to achieve goals, comparing actual performance to those standards, and then making changes to return performance to those standards
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Mintzberg's Management Roles
- Interpersonal
- Informational
- Decisional
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Figurehead Role
managers perform ceremonial duties like greeting company visitors, speaking at the opening of a new facility, or representing the company at a community luncheon to support local charities
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Leader Role
managers motivate and encourage workers to accomplish organizational objectives
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Liaison Role
managers deal with people outside their units.
Studies consistently indicate that managers spend as much time with outsiders as they do with their own subordinates and their own bosses
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Informational Roles
- Monitor
- Disseminator
- Spokesperson
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Monitor Role
managers scan their environment for information, actively contact others for information, and, because of their personal contacts, receive a great deal of unsolicited information
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Disseminator Role
managers share the information they have collected with their subordinates and others in the company
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Spokesperson Role
share information with people outside their departments and companies.
One of the most common ways CEOs serve as spokespeople for their companies is at annual meetings with company shareholders or the board of directors
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Decisional Roles
- Entrepreneur
- Disturbance Handler
- Resource Allocator
- Negotiator
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Entrepreneur Role
managers adapt themselves, their subordinates, and their units to change
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Disturbance Handler Role
managers respond to pressures and problems so severe that they demand immediate attention and action
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Resource Allocator Role
managers decide who will get what resources and how many resources they will get
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Negotiator Role
managers negotiate schedules, projects, goals, outcomes, resources, and employee raises
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First-Line Managers
Office Manager, Shift Supervisor, Department Manager
The primary responsibility of first-line managers is to manage the performance of entry-level employees who are directly responsible for producing a company's goods and services
only managers who don't supervise other managers.
responsibilities include monitoring, teaching, and short-term planning.
encourage, monitor, and reward the performance of their workers
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Top Managers
CEO, COO, CFO, CIO, VP, Corporate Head
responsible for the overall direction of the organization
responsible for creating a context for change
develop employees' commitment to and ownership of the company's performance
must create a positive organizational culture through language and action
responsible for monitoring their business environments
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Middle Managers
General Manager, Plant Manager, Regional Manager, Divisional Manager
responsible for setting objectives consistent with top management's goals and for planning and implementing subunit strategies for achieving those objectives
to plan and allocate resources to meet objectives
to coordinate and link groups, departments, and divisions within a company
to monitor and manage the performance of the subunits and individual managers who report to them
responsible for implementing the changes or strategies generated by top managers
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Team Leaders
Team Leader, Team Contact, Group Facilitator
primarily responsible for facilitating team activities toward accomplishing a goal
help their team members plan and schedule work, learn to solve problems, and work effectively with each other
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Skills needed for lower level managers
- **technical skills
- **human skills
- conceptual skills
- motivation to manage
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Benefits of a self-managed team
perform nearly all of the functions performed by first-line managers under traditional hierarchies
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Punctuated Equilibrium Theory
companies experience long periods of stability followed by short periods of dynamic, fundamental change, followed by a return to stability
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Components of the Specific Environment
- Customer
- Competitor
- Supplier
- Industry Regulation
- Advocacy Group
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Customer Component
customers purchase products and services
companies can't support without customer support
monitoring customers' changing wants and needs is critical to business success
2 basic strategies of monitoring: reactive and proactive
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Reactive Customer Monitoring
involves identifying and addressing customer trends and problems after they occur
ex: listen closely to customer complaints and respond to customer concerns
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Proactive Customer Monitoring
identifying and addressing customer needs, trends, and issues before they occur
ex: total rewards programs
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Competitor Component
companies in the same industry that sell similar products or services to customers
ex: Ford, Toyota, Honda, Nissan
need to keep close track of what competitors are doing--> competitive analysis
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Competitive Analysis
process for monitoring the competition that involves identifying competition, anticipating their moves, and determining their strengths and weaknesses
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Supplier Component
companies that provide material, human, financial, and informational resources to other companies
ex: IBM providing computers and support staff, engineers
key factor influencing the impact and quality of relationship between companies and suppliers is how dependent they are on each other--> supplier dependence
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Supplier Dependence
degree to which a company relies on a supplier because of the importance of the supplier's product to the company and the difficulty of finding other sources of that product
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Buyer Dependence
the degree to which a supplier relies on a buyer because of the importance of that buyer to the supplier and the difficulty of finding other buyers for its products
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Opportunistic Behavior
a high degree of buyer or seller dependence can lead to
a transaction in which on party in the relationship benefits at the expense of the other
will never be completely eliminated
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Relationship Behavior
the establishment of mutually beneficial, long-term exchanges between buyers and suppliers
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Industry Regulation Component
regulations and rules that govern the business practices and procedures of specific industries, businesses, and professions
ex: car manufacturers are subject to CAFE regulations that currently require cars and SUVs to average 27.5 and 22.5 MPG
regulatory agencies affect businesses by creating and enforcing rules and regulations to protect consumers, workers, or society as a whole
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Advocacy Groups
concerned citizens who band together to try to influence the business practices of specific industries, businesses, and professions
ex: try to get manufacturers to reduce smokestack pollution emissions
cannot enforce organizations to change their practices
use techniques to influence companies: public communications, media advocacy, product boycotts
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Public Communications
an advocacy group tactic that relies on voluntary participation by the news media and the advertising industry to get the advocacy group's message out
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Media Advocacy
an advocacy group tactic that involves framing issues as public issues; exposing questionable, exploitative, or unethical practices; and forcing media coverage by buying media time or creating controversy that is likely to receive extensive news coverage
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Product Boycott
an advocacy tactic that involves protesting a company's actions by persuading consumers not to purchase its product or service
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Source of Company's Culture
primary: company founder
recognizing and celebrating heroes
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4 Elements of Successful Organizational Cultures
- Adaptability
- Employee Involvement
- Clear Mission
- Consistency
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Adaptability
the ability to notice and respond to changes in the organization's environment
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Employee Involvement
encourage open discussion and agreement
culture that promote high levels of EI in decision making, employees feel a greater sense of ownership and responsibility
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Clear Mission
business's purpose or reason for existing
with a clear mission, the organization's strategic purpose and direction are apparent to everyone in the company
helps guide the discussions, decisions, and behavior of the people in the company
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Consistency
company actively defines and teachers organizational values, beliefs, and attitudes
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Levels of Organization's Culture
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Changing an Organization's Culture
- Behavioral Addition
- Behavioral Substitution
- Visible Artifacts
- Selection
best way is to combine these
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Behavioral Addition
the process of having managers and employees perform a new behavior that are central to and symbolic of the new organizational culture that a company wants to create
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Behavioral Substitution
process of having managers and employees perform new behaviors central to the new organizational culture in place of behaviors that were central to the old organizational culture
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Visible Artifacts
visible signs of an organization's culture, such as the office design and layout, company dress code, and company benefits and perks, like stock options, personal parking spaces, or the private company dining room
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Selection
hiring and selecting people with values and beliefs consistent with the company's desired culture
process of gathering information about job applicants to decide who should be offered a job
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Global Business
the buying and selling of goods and services by people from different countries
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Forms of Global Business
- Exporting
- Cooperative Contracts
- Strategic Alliances
- Wholly Owned Affiliates
- Global New Ventures
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Exporting
selling domestically produced products to customers in foreign countries
- advantages:
- - makes company less dependent on sales in its home market
- - provides a greater degree of control over research, design, and production decisions
- disadvantages:
- - many exported goods are subject to tariff and non tariff barriers that can substantially increase their final cost to customers
- - transportation costs can significantly increase the price of an exported product
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Cooperative Contracts
agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country
two types: licensing and franchising
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Licensing
a domestic company, the licensor, receives royalty payments for allowing another company, the licensee, to produce the licensor's product, sell its service, or use its brand name in a specified foreign market
advantages: allows companies to earn additional profits without investing more money
disadvantages: licensor gives up control over the quality of the product or service sold by the foreign licensee
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Franchising
collection of networked firms in which the manufacturer or marketer of a product or service, the franchisor, licenses the entire business to another person or organization, the franchisee
disadvantage: face a loss of control when they sell businesses to franchises who are thousands of miles away; success is culture-bound
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Strategic Alliances
agreement in which companies combine key resources, costs, risk, technology, and people
joint venture: two existing companies collaborate to form a third, independent company
advantages: help companies avoid tariff and nontariff barriers to entry; bear only part of the costs and risks
disadvantages: share profits; managing is difficult because reps 4 different cultures
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Wholly Owned Affiliates
foreign offices, facilities, and manufacturing plants that are 100 percent owned by the parent company
advantage: parent company receives all of profits and has complete control over the foreign facilities
disadvantage: expense of building new operations or buying existing businesses
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Global New Ventures
new companies that are founded with an active global strategy and have sales, employees, and financing in different countries
company founders successfully develop and communicate the company's global vision from inception
bring a product or serivie to market in several foreign markets at the same time
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How To Go Global
Consistency= when a multinational company has offices, manufacturing plants, and distribution facilities in different countries and runs them all using the same rules, guidelines, policies, and procedures
Adaptation= modifying rules, guidelines, policies and procedures to adapt to differences in foreign customers, governments, and regulatory agencies
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Tariffs
direct tax on imported goods
increase the cost of imported goods relative to that of domestic goods
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Trade barriers
government-imposed regulations that increase the cost and restrict the number of imported goods
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Protectionism
government's use of trade barriers to shield domestic companies and their workers from foreign competition
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Nontariff barriers
nontax methods of increasing the cost or reducing the volume of imported goods
- quotas
- voluntary export restraints
- government import standards
- government subsidies
- customs valuation/classification
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Quota
limit on number or volume of imported products
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Voluntary Export Restraints
Voluntarily imposed limits on number or volume of products exported to a particular country
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Government Import Standard
standard ostensibly established to protect the health and safety of citizens but, in reality, often used to restrict imports
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Subsidies
government loans, grants ,and tax deferments given to domestic companies to protect them from foreign competition
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Customs Classification
classification assigned to imported products by government officials that affects the size of the tariff and the imposition of import quotas
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Multinational Corporation
corporation that owns businesses in two or more countries
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Direct Foreign Investment
method of investment in which a company builds a new business or buys an existing business in a foreign country
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Political Uncertainty
political risk
risk of major changes in political regimes that can result from war, revolution, death of political leaders, social unrest, or other influential events
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Policy Uncertainty
political risk
risk associated with changes in laws and government policies that directly affect the way foreign companies conduct business
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