MGT 501 Quiz 1 Study
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Why is planning important for managers? Does it really matter?
The functions of organizing, leading, and controlling all carry out the objectives and goals determined through planning. Planning includes all the activities that lead to the definition of objectives and to the determination of appropriate courses of action to achieve those objectives. Planning enables each unit in the organization to define the job that needs to be done and the way to go about doing it. With such a blueprint of objectives, there is less likelihood of changing direction, costly improvising, or making mistakes.
- Four major benefits of planning would include:
- 1. Planning forces managers to think ahead,
- 2. It leads to the development of performance standards that enable more effective management control,
- 3. Having to formulate plans forces management to articulate clear objectives, and
- 4. Planning enables an organization to be better prepared for sudden developments.
Why must an organizational strategy be developed first before other plans? Or does it?
As many of you mentioned above, the larger vision that guides the activities of managers and other employees in an organization is known as a strategy. Strategic thinking is defined as the determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. Strategic planning turns disorderly chaos into orderly results, high performance, high quality, and competitiveness.
How can a manager be sure that relevant information has been gathered, alternative choices have been considered, and possible consequences are understood?
Decision making can be viewed as a series of steps or stages that run from clearly identifying a problem, to implementing and assessing actions, to solving the problem. Using a systematic approach to decision making ensures that relevant information has been gathered, alternative choices have been considered, and possible consequences of actions are understood. In addition to a systematic component, decision making research—especially that utilizing artificial intelligence—has determined that human emotions and interest are also important elements of organizational decision making. Managers at all levels are encouraged to recognize this non-systematic or “qualitative” aspect of decision making.
What is one of the major roles for a manager? Why?
A major role of managers has always been that of change initiator. As time passes, managers can compare actual results with the planned results. The comparisons can lead to corrective action, and this is the essence of controlling. Management initiates planning to determine the priority and timing of objectives. Flexible organizations continually develop new strategies and adapt to new market realities, and then shift all aspects of the organization so that they are congruent with the new strategies.
Does the business portfolio matrix matter to managers? Why?
The most widely used methods to more thoroughly examine differences and help managers make strategic choices regarding business is the business portfolio matrix (BCG matrix), developed by the Boston Consulting Group. With respect to the BCG matrix and in relation to the determination of which units constitute business, some organizations focus on so-called profit centers, those parts of the organization most directly attached to revenue generation.
- Each SBU has four characteristics:
- 1. It has a distinct mission,
- 2. It has its own competitors,
- 3. It is a single business or collection of businesses, and
- 4. It can be planned for independently of the other businesses of the total organization.
When 2 x 2 is used to display concepts thoughtfully distilled from the real world, it can be very powerful. When employed to explain a situation whose complexity must fit into four boxes, it can be misleading. The 2 x 2 is the simplest form of array on which the value of more than one variable can be plotted on each of more than one axis.
How is information technology a double-edged sword for managerial decision making?
As many of you suggested, information technology is a double-edged sword for managerial decision making. On one hand, it has brought forth a bewildering amount of information that is too great for any individual to handle. At the same time, information technology can assist in the analysis and synthesis of information and present it to managers in a way that makes alternative choices and their consequences rather obvious.
How can strategic planning be successfully implemented in organizations?
Strategic plans focus on the broad, enduring issues for ensuring a firm’s effectiveness over a long period of time. Strategic planning focuses on all the activities that lead to the definition of long-term objectives and strategies to achieve those objectives. Some of the most common planning trade-offs faced by managers in business organizations are:
- 1. Short-term profits versus long-term growth
- 2. Profit margin versus competitive position
- 3. Direct sales effort versus development effort
- 4. Greater penetration of present markets versus developing new markets
- 5. Achieving long-term growth through related businesses versus unrelated businesses
- 6. Profit objectives versus nonprofit objectives (that is, social responsibilities)
- 7. Growth versus stability
- 8. Low-risk environment versus high-risk environment
In what ways are Porter’s five-forces important to managers?
Michael Porter's view is that in any industry the nature of competition is embodied in five competitive forces:
- 1. Threat of new entrants,
- 2. Bargaining power of supply,
- 3. Rivalry among competitors,
- 4. Threat of substitute products or services, and
- 5. Bargaining power of buyers.
- Porter neglected a sixth important force: complementors. This term refers to the dependence that develops between companies whose products work in conjunction with each other’s. The strength of Porter’s five forces varies from industry to industry. However, no matter the industry, these five forces determine profitability because they shape the prices firms can charge, the costs they have to bear, and the investment required to compete in the industry.
What are some common errors in managerial decision making and how can they be avoided?
One way to think about the process is to break down into the five-step decision-making process:
- 1. Clarify the problem or opportunity
- 2. Develop alternative courses of action
- 3. Evaluate and select a course of action
- 4. Implement the decision
- 5. Monitor its effectiveness
A lot of you identified biases through the process, but even starting with the first step, managers make several common biases or mistakes when identifying and clarifying a problem.
- Three of these are:
- 1. Perceptual inaccuracies
- 2. Defining problems in terms of solutions
- 3. Identifying symptoms as problems
Perceptual inaccuracies: A common problem is for managers to delay or completely avoid making tough decisions about a problem employee if the manager has personal feelings for the person. Defining problems in terms of solutions: This occurs often when someone has a favorite tool or procedure that they like to implement. Identifying symptoms as problems: This occurs when a manager doesn’t look deep enough into a problem to find the larger issue that needs to be addressed. Before a decision is reached, alternative courses of action must be developed. This step involves examining the organization’s internal and external environments for information and ideas that may lead to creative solutions to a problem. In most situations, implementing a decision involves delegating responsibilities to people. Thus, the effectiveness of a decision is often a function of how well it’s put into action by people other than the person who made the decision.
In what way is the job characteristic model important to managers?
The job characteristics model (JCM) suggests that jobs should be designed to include five important core dimensions that increase motivation, performance, and satisfaction, reducing employee turnover and absenteeism. The relative presence of these five key job characteristics—skill variety, task identity, task significance, autonomy, and feedback—creates different levels of three critical psychological states: experienced meaningfulness, experienced responsibility, and knowledge of results. These three states are necessary for job satisfaction and motivation.
Why would management ever want to use a departmental structure in their organization?
Departmentalization is the process of grouping jobs according to three key factors: logic, physical location, and social harmony. The logic of departmentalization is based on how best to group jobs according to the task at hand and the required individuals and jobs to complete it. A factor in departmentalization is physical location. In a plant, jobs are organized into departments based in part on the layout of the organization’s physical space. For example, a company with copious physical space may decide to separate sales from marketing. The final factor in departmentalization is social harmony. For example, in software companies, application developers may dislike administrators. Creating a single department that placed the two different groups in close proximity may be counterproductive. Good managers don’t fancy themselves as social workers who wish to create harmony where it doesn’t exist. Good managers accept current reality and design the organizational structure that works best with things as they are. Good managers balance long-range change efforts with the immediate demands of meeting day-to-day organizational objectives.
What are steps management can take to ensure the selection of new employees is successful?
- Some steps managers can take to ensure sound employment decisions are:
- 1. Inform candidates up front of the recruiting procedures,
- 2. Require candidates to complete an application form that includes a signed statement from the applicant confirming the accuracy of the information provided and consenting to a background check,
- 3. Follow up reviews of the application with a telephone interview,
- 4. Ask the right questions, and
- 5. Conduct mandatory background checks.
Why are job designs and analysis important tools for management?
Job design refers to the process by which managers determine individual job tasks and authority.
- Job design and redesign techniques attempt:
- 1. To identify the most important needs of employees and the organization; and
- 2. To remove obstacles in the workplace that frustrate those needs.Job analysis is the process of determining the tasks that make up the job and the skills, abilities, and responsibilities that are required of an individual to successfully accomplish the job.
- Job analysis achieves two vital purposes in the organization:
- 1. It specifies the tasks that must be accomplished to complete a job; and
- 2. It determines the skills and knowledge necessary to perform the tasks.
- A typical job analysis involves five steps:
- 1. Examining how each job fits into the overall organization,
- 2. Selecting jobs to be analyzed,
- 3. Collecting data on the jobs to be analyzed,
- 4. Preparing a job description, and
- 5. Preparing a job specification.
What does organizational design and structure have to do with being a manager?
Organizational structure is the framework of jobs and departments or divisions that directs the behavior of individuals and groups toward achieving the organization’s goals and objectives. Organizational strategy specifies what will be accomplished. Organizational structure specifies who will accomplish what and how it will be accomplished.
- Managers are faced with at least four choices about organizational design:
- 1. Degree of specialization,
- 2. Delegation of authority,
- 3. Type of departmentalization, and
- 4. Span of control.
In what way are humans a resource in an organization?
The proper use of people involves understanding both individual and organizational needs so that the full potential of human resources can be employed. This part of human resources management suggests that it is important to match individuals over time to shifts in organizational and human needs. Anticipating future business and environmental demands requires a planning system.
The activities that a manager could follow in such a system include the following:
- 1. Human resource inventory,
- 2. Forecasting,
- 3. Human resource plans, and
- 4. Development plans.
Why should a manager care about job satisfaction, involvement, and enrichment?
The pioneering Walker and Guest study was concerned with the social and psychological problems associated with mass production jobs in automobile assembly plants. The findings of this research gave early support for motivation theories that predict increases in job range will increase job satisfaction and other, objective, job outcomes. Job satisfaction depends on the levels of intrinsic and extrinsic outcomes and how the jobholder views those outcomes. Another important individual difference is job involvement. Job involvement: This variable accounts for the fact that two workers could report different levels of satisfaction for the same performance levels. People differ in the extent that:
- 1. Work is a central life interest,
- 2. They actively participate in work,
- 3. They perceive work as central to self-esteem, and
- 4. They perceive work as consistent with self-concept.
How can the optimal span of control be determined by management?
Span of control refers to the number of people who report to one manager or supervisor. The objective in establishing span of control is to determine the optimal design: wide or narrow. A wide span of control (flat organizational structure) results in a large number of workers reporting to one supervisor. A narrow span of control (tall organizational structure) results in a small number of people reporting to a single manager. Generally, a span of control comes down to the decision of how many people a manager can effectively oversee; that is, will the organization be more effective if the manager’s span of control is relatively large or small? The only feasible approach to determining optimal span of control is to weigh the relative importance of a number of factors. Those factors include the following:
- 1. The competence of both the manager and the subordinates,
- 2. The degree of interaction that is required among the units to be supervised,
- 3. The extent to which the manager must carry out non managerial tasks,
- 4. Relative similarity or dissimilarity of the jobs being supervised,
- 5. The extent of standardized procedures, and
- 6. The degree of physical dispersion.
How can performance evaluations be used correctly by management?
- The process of performance evaluation can be made far less painful if managers think of it as a three-step process:
- 1. Collect the necessary data;
- 2. Evaluate the employee’s performance; and
- 3. Write the performance review.
- At least four requirements must be met before a measure can qualify as a performance standard:
- 1. Relevant requirement
- 2. Stable requirement
- 3. Discriminatory requirement
- 4. Practical requirement
How can a manager be an effective leader?
- Efforts to analyze effective leadership have focused on three general areas:
- 1. The personal characteristics of leaders,
- 2. The behavior of leaders, and
- 3. The situations in which leaders are found.
Overall, the objective of leadership is to bring about influence so that important goals are achieved. This influence is brought about not only directly through authority or motivation, but also indirectly through role-modeling.
How can a manager effectively motivate others in an organization?
Motivation is a general term used to describe the process of starting, directing, and maintaining physical and psychological activities. In a formal sense motivation is defined as "all those inner striving conditions described as needs, drives, desires, motives, and so forth. It is an inner state that activates or moves." The employees’ abilities, outside work activities, available resources, working conditions, and the style of management are important factors to consider when diagnosing what is thought to be a motivation problem.
What role does communication play in the duties of a manager?
Communication is defined as the transmission of mutual understanding through the use of symbols. The manager’s interpersonal roles require constant communication between managers and subordinates, customers, suppliers, peers, and superiors. In the informational roles, managers seek information from all their contacts that may affect their job performance and goal accomplishment. The manager’s decisional roles involve using information, contacts, and relationships to allocate limited resources, solve conflict-laden situations, and initiate problem-solving solutions.
How can a manger BEST influence others in an organization?
Probably one of the best way is to actually be a true leader. Individuals who influence the behavior of their assigned groups are the formal leaders of organizations. Therefore leadership can be defined as: The ability to influence through communication the activities of others, individually or as a group, toward the accomplishment of worthwhile, meaningful, and challenging goals.
What role does intrinsic motivation have in management?
Intrinsic rewards are the natural rewards a person receives by performing a task or activity. Defined formerly, intrinsic reward: The completion of a project or the solving of a problem may yield a sense of accomplishment and personal fulfillment. Managers and workers together can build intrinsic motivation.
- The building blocks are shown below:
- 1. Choice,
- 2. Competence,
- 3. Meaningfulness, and
- 4. Progress.
How can a manager effectively communicate with others in an organization?
Effective communication requires that the communicator anticipate the receiver’s decoding ability. Unintended messages can be sent by silence or inaction on a particular issue as well as by decisions on which goals and objectives are not to be pursued and which methods are not to be utilized. For example, both the quality and quantity of communications can be regulated based on the exception principle of management.
What role does leadership play in the duties of a manager?
Managers are primarily concerned with process and leaders are primarily concerned with substance. Therefore, to integrate leadership into management, the seven influence strategies proposed as vital for practicing leadership roles may help. They are reason, friendliness, coalition, bargaining, assertiveness, higher authority, and sanctions. Level Five leaders, for example, are individuals who usually have risen up within a particular industry and who lead primarily by example. They are not concerned with being “the CEO” or with being a “celebrity”; they are focused on results and do whatever is necessary to achieve them.
In what way could managers use the various motivational theories in a real organization?
There are many applications; for example, one process theory of motivation was developed by Victor H. Vroom, and it expands on the work of Maslow and Herzberg. Vroom’s expectancy theory of motivation views motivation as a process governing choices.
- The theory proposes three determinants of motivation:
- 1. The expectancy that individual effort will result in performance.
- 2. The belief that performance will result in reward.
- 3. The valence of rewards.
What is the relationship between managerial communication and organizational design?
Managers must provide for organizational communication in three distinct directions, downward, upward, and horizontal. A high-performing organization needs effective upward communication as much as it needs effective downward communication. Effective upward communication—getting messages from employees to management—is difficult to achieve, especially in larger organizations. Nevertheless, often overlooked in the design of most organizations is provision for the formal horizontal flow of communication. Horizontal communication—for example, between production and sales departments in a business organization and between different departments within a hospital—is necessary for the coordination of diverse organizational functions.
What role does operations play in being a manager?
Operations are the functions needed to keep the company producing and delivering. They’re literally any function or series of functions enacted to carry out a strategic plan. Operations for a manufacturer might include purchasing, materials management, production management, inventory, quality control, and other activities. Production and operations (P&O) managers are responsible for producing the goods and services that businesses sell. P&O managers have product planning responsibilities such as preparing forecasts, schedules, and budgets in collaboration with top management, finance managers, and marketing managers. Operations management involves acquiring resources (inputs) and allocating them among the resources’ competing users.
How can a Manager achieve effective control?
- The controlling function consists of actions and decisions managers undertake to ensure that actual results are consistent with desired results. Since quality is largely a function of customer perceived value, including customer feedback in the standard-setting stage of the control process is very important. Effective control requires three basic conditions:
- 1. Standards that reflect the ideal outcomes.
- 2. Information and measurement that indicate deviations between actual and standard results.
- 3. Corrective action for any deviations between actual and standard results.
What does change have to do with being an effective manager?
The growing realization that organizations can become more effective through managerial applications of behavioral science has spawned a wealth of literature. Change management is part science and part art. The science part comes from knowing what techniques to apply to create effective, lasting, organizational change. The art part comes from knowing which technique to use in which situation.
How can a manager take advantage of direction and feedback in overseeing employees?
- Direction is basically a process of interpersonal communication, so the amount and clarity of information are important factors. Direction involves day-to-day overseeing of the work of subordinates. As deviations from standards are identified, managers must take immediate corrective action by coaching their subordinates and showing them how to perform their assigned tasks appropriately. Feedback control employs historical outcomes as bases for correcting future actions. Feedback control methods are widely used in business:
- 1. Financial statement analysis.
- 2. Standard cost analysis.
- 3. Employee performance evaluation.
- 4. Quality control.
What role does cost play in managerial production efforts?
Preliminary control methods focus specifically on controlling the acquisition of resources. Ordering costs are incurred each time material is ordered from a supplier. These are the clerical and administrative costs per order, and they include the costs of placing the materials into inventory. Carrying costs are incurred whenever items are held in inventory. To minimize inventory costs, a manager must minimize both ordering and carrying costs. These two costs are related to each other in opposing directions.
How can change be effectively managed?
The change process is a continuous process. It’s a cycle that feeds back information; information that can be used for additional change and improvement. Once change is implemented it should be carefully monitored so that real time adaptations and improvements can be made. The failure to monitor change, unfortunately, is often bypassed in many organizations. The process of change includes the recognition step and this is the point at which management must decide to act or not to act. Kurt Lewin introduced the notion of three stages in the change process: unfreezing, changing, and refreezing.
What role does cost play in the control efforts of managers?
Standard cost accounting systems are considered a major contribution of scientific management to organizational control. A standard cost system provides information that allows managers to compare actual costs to budgeted, or predetermined, costs. An organization’s cost of quality is the total expense involved in ensuring that a product or service meets established quality standards. Prevention costs are the costs of preventing product or service defects—the precontrol aspect of quality control. Appraisal costs are all expenses involved in directly evaluating quality, such as the costs of quality inspection and testing. Failure costs occur once a defect is produced and identified.
In what way can the JIT approach be utilized by management?
JIT manufacturing principles include: Provide inventory exactly when needed and no sooner, Eliminate safety stocks, Order materials and produce in small lots, Maintain a stable production schedule, and Train employees to inspect quality while working on the product. A JIT manufacturing approach requires that the exact quantity of raw materials, parts, and subassemblies are delivered to the part of the production process where they are needed at the precise time they are needed. The JIT concept extends backward to suppliers and forward to customers. An efficient JIT system should result in low inventory and thus reduced costs due to reduced working capital. A JIT system can also save costs by reducing warehouse space that would be needed to hold inventory. Additionally, the space that would have been put to warehouse storage can be used for production, increasing the potential output for the firm.
What type of change can be the most difficult to control as a manager? Why?
Managers of business firms must respond to changes in the marketplace, the first external force for change. The external forces are changes in the marketplace, the technology, and the environment; these usually are beyond the control of the manager. Managers must be tuned in to societal movements over which they have no control but which control the fates of their firms. Although business cycles are rather regular and periodic, social changes are less cyclical and tend to catch business leaders unprepared.
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