PART 1: INTRODUCTION TO MANAGEMENT

CHAP 1: MANAGERS AND YOU IN THE WORKPLACE

Who are managers and where do they work?

Who Is a Manager?
Manager: coordinates & oversees the work of other people so organizational goals can be
accomplished

First-line (frontline) managers: manage the work of nonmanagerial employees

Middle managers: manage the work of first-line managers
Top managers: responsible for making organization-wide decisions + establishing the goals &
plans affect the entire organization

Where Do Managers Work?

Managers work in organizations

The Characteristics of Organizations

Why are managers important?
1. Organizations need their managerial skills & abilities
2. They’re critical to getting things done
3. Managers do matter

What do managers do?

Management => do things Efficiently and Effectively
● Efficiency: “Doing things right” => get the most output from the least amount of inputs
● Effectiveness: “Doing the right things” => do those works result in achieving goals

Management Functions
Mintzberg’s Managerial Roles and a Contemporary Model of
Managing

Interpersonal roles: people and other duties that are ceremonial and symbolic in nature
Informational roles: collecting, receiving, and disseminating information
Decisional roles: revolve around making choices

Management Skills

Technical skills: Job-specific knowledge & techniques

Interpersonal skills: work well with other people individually & in a group
Conceptual skills: think & conceptualize about abstract and complex situations
Why study management?

The Universality of Management

Universality of management: The reality needed in all types and sizes of organizations, at all
organizational levels, in all organizational areas, and in organizations no matter where located

Rewards and Challenges of Being a Manager

REWARDS CHALLENGES
- Can be a thankless job - Responsible for creating a productive work
- May entail clerical type duties environment
- Managers also spend significant amounts of - Recognition and status in your organization
time in meetings and dealing with and in the community
interruptions - Attractive compensation in the form of
- Managers often have to deal with a variety salaries, bonuses, and stock options
of personalities and have to make do with
limited resources
 CHAP 2: DECISION MAKING

The decision-making process

Step 3+4+5: Weight the criterias

Ex: HP ProBook - Memory & Storage = 10 x 10 = 100, Battery Life = 8 x 3 = 24,....

=> total = 100 + 24 + …. = 231

Overview of Managerial Decision Making

Approaches to decision making

Rationality
Rational decision making: choices => logical + objective + consistent + maximize value

Bounded Rationality
Bounded rationality: Decision => rational, but limited (bounded) by an individual’s ability to
process information
=> Managers satisfice - accept solutions are “good enough” rather than maximize
Escalation of commitment: An increased commitment to a previous decision despite evidence it
may have been wrong

Intuition
Intuitive decision making => on the basis of experience, feelings, and accumulated judgment

Evidence-Based Management
Evidence-based management (EBMgt): The systematic use of the best available evidence to
improve management practice
4 elements:
1. decision maker’s expertise and judgment
2. External evidence that’s been evaluated by the decision maker;
3. Opinions, preferences, and values of those who have a stake in the decision
4. Relevant organizational (internal) factors: context, circumstances, and members
Types of decisions and decision-making conditions

Types of Decisions
2 types:

STRUCTURED PROBLEMS AND PROGRAMMED DECISIONS

Structured problems: Straightforward, familiar, and easily defined problems
Programmed decision: repetitive decision that can be handled by a routine approach
Procedure: series of sequential steps used to respond to a well-structured problem
Rule: explicit statement that tells managers what can or cannot be done
Policy: guideline for making decisions

UNSTRUCTURED PROBLEMS AND NONPROGRAMMED DECISIONS

Unstructured problems: new or unusual problems & information is ambiguous or incomplete
Nonprogrammed decisions: Unique & nonrecurring decisions require a custom-made solution

Decision-Making Conditions
Certainty: make accurate decisions because all outcomes are known
Risk: able to estimate the likelihood of certain outcomes
Uncertainty: neither certainty nor reasonable probability estimates available

Decision-making biases and errors

Heuristics: “Rules of thumb” => use to simplify decision making
Overconfidence bias: think they know more than they do/hold unrealistically positive views of
themselves and their performance
Immediate gratification bias: want immediate rewards & avoid immediate costs => choices
providing quick payoffs are more appealing than those with payoffs in the future.
Anchoring effect: fixate on initial information as a starting point & fail to adequately adjust for
subsequent information
Selective perception bias: selectively organize & interpret events based on their biased
perceptions => influences the information they pay attention to, the problems they identify, and
the alternatives they develop
Decision makers: seek out information reaffirming their past choices & discounts information
contradicting past judgments => accept at face-value information confirming their preconceived
views & are critical, skeptical of information challenging these views.
Framing bias: select, highlight certain aspects of a situation while excluding others => distort
what they see and create incorrect reference points.
Availability bias: remember events are the most recent & vivid in their memory => recall events
in an objective manner and results in distorted judgments & probability estimates.
Representation bias: assess the likelihood of an event based on how closely it resembles other
events/sets of events => draw analogies & see identical situations where they don’t exist.
Randomness bias: create meaning out of random events => difficulty dealing with chance
Sunk costs error: forget current choices can’t correct the past => incorrectly fixate on past
expenditures in assessing choices rather than on future consequences
Self-serving bias: quick to take credit for their successes & blame failure on outside factors
Hindsight bias: falsely believe they accurately predict the outcome of an event once that
outcome is actually known
Effective decision making in today’s world

Guidelines for Effective Decision Making

● Understand cultural differences
● Create standards for good decision making
● Know when it’s time to call it quits
● Use an effective decision-making process
6 characteristics:
(1) focuses on what’s important
(2) logical & consistent
(3) acknowledges subjective & objective thinking blends with intuitive thinking
(4) requires only as much information + analysis to resolve a particular dilemma
(5) encourages and guides the gathering of relevant information and informed opinion
(6) straightforward, reliable, easy to use, flexible
● Develop your ability to think clearly

Design Thinking and Decision Making

Design thinking: Approaching management problems as designers approach design problems

Big Data and Decision Making

Big data: vast amount of quantifiable information analyzed by highly sophisticated data processing

PART 2: BASICS OF MANAGING IN TODAY’S WORKPLACE

CHAP 3 GLOBAL MANAGEMENT

What’s your global perspective?

Parochialism: Viewing the world solely through your own perspectives, leading to an inability to
recognize differences between people
3 possible global attitudes:
● Ethnocentric attitude: parochial belief the best work approaches + practices are those of
the home country
● Polycentric attitude: managers in the host country know the best work approaches +
practices for running their business
● Geocentric attitude: world-oriented view focusing on using the best approaches + people
from around the globe
Understanding the global trade environment

Regional Trading Alliances

The European Union

European Union (EU): union of 28 European nations created as a unified economic and trade
entity => Euro - single common European currency

North American Free Trade Agreement (NAFTA) & Other Latin American Agreements
North American Free Trade Agreement (NAFTA): agreement among the Mexican, Canadian,
U.S. governments in which barriers to trade have been eliminated

Association of Southeast Asian Nations (ASEAN)

Association of Southeast Asian Nations (ASEAN): trading alliance of 10 Southeast Asian
Other Trade Alliances
● 54-nation African Union (AU)
● East African Community (EAC): 5 east African nations—Burundi, Kenya, Rwanda,
Tanzania, and Uganda
● South Asian Association for Regional Cooperation (SAARC): 8 member states - India,
Pakistan, Sri Lanka, Bangladesh, Bhutan, Nepal, the Maldives, and Afghanistan
● TransPacific Partnership (TPP): 12 countries - United States, Canada, Mexico, Japan,
Australia, and 7 other countries around the Pacific region, excluding China

Global Trade Mechanisms

World Trade Organization

World Trade Organization (WTO): global organization of 161 countries dealing with the rules
of trade among nations

International Monetary Fund and World Bank Group

International Monetary Fund (IMF): organization of 188 countries promoting international
monetary cooperation & providing advice, loans, technical assistance
World Bank Group: group of 5 closely associated institution providing financial & technical
assistance to developing countries

Organization for Economic Cooperation and Development (OECD)

Organization for Economic Cooperation and Development (OECD): international economic
organization help its 34 member countries achieve sustainable economic growth & employment
Doing business globally

Different Types of International Organizations

Multinational corporation (MNC): broad term refering to all types of international companies
that maintain operations in multiple countries:
● Multidomestic corporation: decentralizes management & other decisions to the local
● Global company: centralizes management & other decisions in the home country
● Transnational or borderless organization: artificial geographical barriers are eliminated

How Organizations Go International

Global sourcing: purchase materials / labor from around the world wherever it is cheapest
Exporting: make products domestically & sell them abroad
Importing: acquire products made abroad & sell them domestically
Licensing: organization give another organization the right to make / sell its products using its
technology / product specifications
Franchising: organization gives another organization the right to use its name & operating
methods
Strategic alliance: partnership between an organization & foreign company partner(s), both
share resources + knowledge in develope new products / build production facilities
Joint venture: specific type of strategic alliance, the partners agree to form a separate,
independent organization for some business purpose
Foreign subsidiary: directly investing in a foreign country by set up a separate & independent
production facility / office
Managing in a global environment

The Political/Legal Environment

● U.S. managers are accustomed to a stable legal and political system
● Managers must stay informed of the specific laws in countries where they do business
● Some countries have risky political climates

The Economic Environment

● Free Market Economy: resources are primarily owned & controlled by private sector
● Planned Economy: economic decisions are planned by a central government

The Cultural Environment

● National Culture: values, attitudes shared by individuals from a specific country shape
their behavior & beliefs about what is important.

HOFSTEDE’S FRAMEWORK FOR ASSESSING CULTURES

THE GLOBE FRAMEWORK FOR ASSESSING CULTURES
Global Leadership and Organizational Behavior Effectiveness (GLOBE) program: ongoing
research extended Hofstede’s work by investigating cross-cultural leadership behaviors
Identify 9 dimensions:
● Power distance => fit directly with Hofstede’s
● Uncertainty avoidance => fit directly with Hofstede’s
● Assertiveness = achievement-nurturing
● Humane orientation = nurturing
● Future orientation = long-term & short-term orientation
● Institutional collectivism = individualism-collectivism
● Gender differentiation => additional insights
● In-group collectivism => additional insights
● Performance orientation => additional insights

Global Management in Today’s World

● The Challenge of Openness
+ Increased threat of terrorism
+ Economic interdependence of trading countries
+ Intense fundamental cultural differences
● Cultural Intelligence: cultural awareness & sensitivity skills
● Global Mind-Set: attributes allow a leader to be effective in cross-cultural environments
 CHAP 4: VALUING A DIVERSE WORKFORCE

Diversity

What Is Workplace Diversity?

Workforce diversity: people in an organization are different from & similar to one another

● Surface-level: Easily perceived differences that may trigger certain stereotypes, but that
do not necessarily reflect the ways people think or feel
● Deep-level: Differences in values, personality, and work preferences
Why Is Managing Workforce Diversity So Important?

Benefits

The changing workplace

Characteristics of the U.S. Population

● Total population of the United States
● Racial/ethnic groups
● Aging population

Global Population Trends and the Changing Global Workforce

● Age Trends
● Gender, gender identity, sexual orientation
● Migration & movement

Types pf workplace diversity

 ● Age: Title VII of the Civil Rights Act of 1964 & Age Discrimination in Employment Act
of 1967 prohibit age discrimination
● Gender: Women (49.8%) & men (50.2%) now each make up almost half of workforce
● Race: biological heritage (skin color & associated traits) use to identify
● Ethnicity: social traits (cultural background/allegiance) shared by a human population
● Disability/abilities: Americans With Disabilities Act of 1990 prohibits discrimination
against persons with disabilities.
● Religion: Title VII of the Civil Rights Act prohibits discrimination on basis of religion
● LGBT: 2 separate U.S. Supreme Court cases, transgendered (gender identity), lesbian,
bisexual, gay (sexual orientation) were protected under Title VII
● Others: any dissimilarities/differences might be present in a workplace

Challenges in managing diversity

● Bias: tendency/preference toward a particular (one-sided) perspective/ideology
● Prejudice: preconceived belief, opinion, judgment toward a person/group of people
● Stereotyping: judgment based on a perception of a group to which that person belongs
● Discrimination: acts out their prejudicial attitudes toward targets of their prejudice
● Glass ceiling: invisible barrier separates women & minorities from top management

Workplace diversity initiatives

The Legal Aspect of Workplace Diversity

Workplace diversity needs to be more than understand & comply with federal laws
Mentoring
Mentoring: experienced organizational member (a mentor) provides advice & guidance to less
experienced member (a protégé)

Diversity skills training: specialized training to educate employees about the importance of
diversity, teach them skills for working in a diverse workplace
Employee resource groups: groups made up of employees connected by some common
dimension of diversity
 CHAP 5: SOCIALLY-CONSCIOUS MANAGEMENT

What is social responsibility?

From Obligations to Responsiveness to Responsibility

● Social obligation: a firm engages in social actions because of its obligation to meet
certain economic & legal responsibilities
● Classical view: only to maximize profits
● Socioeconomic view: goes beyond making profits to protect & improve society’s welfare
+ Social responsiveness: response to some popular social need
+ Social responsibility: business’s intention, beyond its legal, economic obligations,
to do the right things + act in ways are good for society

Should Organizations Be Socially Involved?

Social screening: Apply social criteria (screens) to investment decisions
Green management and sustainability
Green management: consider the impact of their organization on the natural environment

How Organizations Go Green

Legal (light green): simply doing what is required legally => obey laws, rules, regulations
without legal challenge and that’s the extent of their being green.
Market approach: respond to environmental preferences of customers
Stakeholder approach: meet the environmental demands of multiple stakeholders (employees,
suppliers, community)
Activist (dark green): protect the earth’s natural resources => the highest degree of
environmental sensitivity & illustrates social responsibility

Evaluating Green Management Actions

● Company-issued reports on environmental performance
● ISO 9000 (quality management) and ISO 14000 (environmental management) standards
● Global 100 list of the most sustainable corporations in the world

Managers and ethical behavior

Ethics: principles, values, beliefs defining right & wrong behavior

Factors That Determine Ethical and Unethical Behavior

STAGE OF MORAL DEVELOPMENT

INDIVIDUAL CHARACTERISTICS

● Values: Basic convictions about what is right and wrong

● Ego strength: personality measure of the strength of a person’s convictions
● Locus of control: personality attribute measures the degree to which people believe they
control their own fate
+ Internal: control their own destinies
+ External: what happens to them is due to luck or chance

STRUCTURAL VARIABLES

Ethical behavior can be influenced by:

● An organization’s structural design
● Goals
● Performance appraisal system
● Reward allocation

ISSUE INTENSITY
The six factors suggest that:
● the larger the number of people harmed
● the more agreement that the action is wrong
● the greater the likelihood that the action will cause harm
● the more immediately the consequences of the action will be felt
● the closer the person feels to the victim
● The more concentrated the effect of the action on the victim(s)…
The greater the issue intensity or importance

Ethics in an International Context

● Ethical standards are not universal
● Foreign Corrupt Practices Act
● United Nations Global Contract

The 10 Principles of the United Nations Global Compact

Encouraging ethical behavior

Employee Selection
Values-based management: organization’s values guide employees in the way they do their jobs

Codes of Ethics and Decision Rules

Codes of Ethics
formal statement of an organization’s primary values + the ethical rules it expects its employees to follow

A Process for Addressing Ethical Dilemmas

Developing codes of ethics
1. model appropriate behavior and reward those who act ethically.
2. continually reaffirm the importance of the ethics code + consistently discipline those break it.
3. organization’s stakeholders (employees, customers, and so forth) should be considered as an
ethics code is developed or improved.
4. communicate + reinforce the ethics code regularly.
5. use the 5-step process (see Exhibit 5-8) to guide employees when faced with ethical dilemmas

Leadership at the Top

Doing business ethically requires a commitment from managers at all levels, but especially the
top level because:
● they uphold the shared values and set the cultural tone
● they’re role models in both words and actions

Job Goals and Performance Appraisal

Under the stress of unrealistic goals, otherwise ethical employees may feel they have no choice
but to do whatever is necessary to meet those goals

Ethics Training
More organizations are setting up seminars, workshops, similar ethics training programs to
encourage ethical behavior.

Independent Social Audits

Independent social audits: evaluate decisions + management practices regarding the
organization’s code of ethics
Social responsibility and ethics issues in today’s world

Managing Ethical Lapses and Social Irresponsibility

What managers do has a strong influence on employees’ decisions whether to behave ethically

Being an Ethical Leader

Whistle-blower: individual who raises ethical concerns or issues to others

Social Entrepreneurship
Social entrepreneur: individual/organization that seeks out opportunities to improve society by
using practical, innovative, and sustainable approaches

Businesses Promoting Positive Social Change

● Corporate philanthropy: an effective way for companies to address societal problems
● Employee volunteering efforts: a popular way for businesses to be involved in
promoting social change

CHAP 6: MANAGING CHANGE

The case for change

= change
● Organizational change: any alteration of people, structure, technology in organization
● Change agent: someone acts as a catalyst + assumes the responsibility for managing the
change process

External & Internal Forces for Change

The change process

Calm Waters Versus White-Water Rapids Metaphors

Kurt Lewin’s 3-step change process

● Calm waters metaphor:
+ Unfreezing the status quo
+ Changing to a new state = forever
+ Refreezing to make the change permanent
● White-water rapids metaphor: lack of environmental stability and predictability requires
that managers and organizations continually adapt and manage change actively to survive

Reactive versus Proactive Change Processes

● Reactive: react to a situation that has occurred
● Proactive: act in advance of a situation

Areas of change

4 types of change

Strategy
Failure to change strategy when circumstances dictate could undermine a company’s success

Structure
Changing structural components/structure design
Technology
● New equipment, tools, or methods
● Automation
● Computerization

People
Organizational development (OD): change methods that focus on people and the nature and
quality of interpersonal work relationships.

Popular OD Techniques

Managing change

Why Do People Resist Change?

● Uncertainty ● Habit ● Fear of loss
● Belief change is inconsistent with goals of organization
Techniques for Reducing Resistance to Change

Contemporary issues in managing change

Leading Change
Managers can make change happen successfully by:
● make organization change capable
● understand their own role in process
● give employees a role in the change

Change-Capable Organizations
Creating a Culture for Change
The fact that an organization’s culture is made up of relatively stable, permanent characteristics
tends to make it very resistant to change

UNDERSTANDING THE SITUATIONAL FACTORS

create the opportunities to change
Conditions that facilitate change:
dramatic crisis occurs leadership change hands culture is weak

MAKING CHANGES IN CULTURE

Changing Culture

Employee Stress
● Stress: adverse reaction people have to excessive pressure placed on them from
extraordinary demands, constraints, or opportunities
● Stressors: factors that cause stress

WHAT CAUSES STRESS?

● Task demands => employee’s job
● Role demands => function of the particular role
+ Role conflicts => work expectations hard to satisfy
+ Role overload => more work to accomplish than time permit
+ Role ambiguity => expectation not clearly understood
● Interpersonal demands => created by other employees
● Organization structure => excessive rules
● Organizational leadership => supervisory style
Personal factors:
● Type A personality: have a chronic sense of urgency and an excessive competitive drive
● Type B personality: relaxed and easygoing and accept change easily
WHAT ARE THE SYMPTOMS OF STRESS?

HOW CAN STRESS BE REDUCED?

● Realistic job preview during selection process
● Performance planning program, e.g. MBO
● Job redesign
● Addressing personal stress
+ Counseling
+ time management programs
+ wellness programs

Stimulating innovation

Creativity Versus Innovation

● Creativity: uniquely combine ideas or make unusual associations between ideas
● Innovation: take creative ideas + turn them into useful products or work methods

Stimulating and Nurturing Innovation

Idea champion: individual actively & enthusiastically supports new ideas, builds support,
overcomes resistance, ensures that innovations are implemented
 Innovation Variables

Innovation and Design Thinking

When a business approaches innovation with a design-thinking mentality, the emphasis is on
getting a deeper understanding of what customers need and want.

Disruptive innovation

Definition
● Disruptive innovation: innovations in products, services, processes that radically change
an industry’s rules of the game
● Sustaining innovation: small and incremental changes in established products rather
than dramatic breakthroughs

Examples of Past Disruptive Innovators

Why Disruptive Innovation Is Important
Disruptive innovations are a threat to many established businesses, and responding with
sustaining innovations isn’t enough

Who’s Vulnerable?
Large, established, highly profitable organizations are most vulnerable to disruptive innovations
as they have the most to lose and are most vested in their current markets and technologies

Implications
● For entrepreneurs
● For corporate managers
+ Skunk works: small group within a large organization, given a high degree of
autonomy and unhampered by corporate bureaucracy, whose mission is to
develop a project primarily for the sake of radical innovation
● For career planning

CHAP 7: CONSTRAINTS ON MANAGERS

The manager: omnipotent or symbolic?

The Omnipotent View

Omnipotent view: managers are directly responsible for an organization’s success or failure

The Symbolic View

Symbolic view: much of an organization’s success or failure is due to external forces outside
managers’ control
Managerial constraints:
● In reality, managers are neither all-powerful nor helpless. But their decisions and actions
are constrained.
● External constraints come from the organization’s environment and internal constraints
come from the organization’s culture

Constraints on Managerial Discretion

The external environment: constraints and challenges
External environment: factors and forces outside the organization that affect its performance

The Economic Environment

Managers need to be aware of economic context to make best decisions for their organizations
● Lingering global economic challenges began with the turmoil in the U.S. housing market
● In many countries, people believe that the gap between the rich and poor is problematic.

The Demographic Environment

● Age is a particularly important demographic since the workplace often has different age
groups all working together:
Baby Boomers Gen Y (Millennials) Post-Millennials (Gen Z)

How the External Environment Affects Managers

● Jobs and Employment: impact of external factors => one of the most powerful
constraints mangers face
● Environmental uncertainty: degree of change, complexity in organization’s environment
+ Change: stable -> dynamic
+ Complexity: simple -> complex
● Environmental complexity: number of components in organization’s environment &
extent of organization’s knowledge about those components

Environmental Uncertainty Matrix

 ● Stakeholders: any constituencies in the organization’s environment affected by an
organization’s decisions and actions

Organizational Stakeholders
Benefits of good stakeholder relationships:
● Improved predictability of environmental changes
● Increased successful innovations
● Increased trust among stakeholders
● Greater organizational flexibility to reduce the impact of change

Organizational culture: constraints and challenges

Just as each individual has a unique personality, an organization, and a personality.

What Is Organizational Culture?

Organizational culture: shared values, principles, traditions, ways of doing things influence the
way organizational members act & distinguish the organization from other organizations
● Perception ● Descriptive ● Shared

Dimensions of Organizational Culture

Contrasting Organizational Cultures
● Risk-taking & change discouraged
● Creativity discouraged
● Close managerial supervision
● Work designed around individual employees

● Risk-taking and change rewarded

● Creativity and innovation rewarded
● Management trusts employees
● Work designed around teams

Strong Cultures
Strong cultures: organizational cultures in which key values are intensely held, widely shared

Where Culture Comes From and How It Continues

● Cuture’s original sourc usually reflects the vision of founders.
● Once the culture is in place, certain organizational practices help maintain it.
● Actions of top managers also have a major impact on the organization’s culture.

How Employees Learn Culture

● Stories ● Rituals ● Language
● Material Artifacts and Symbols
How Culture Affects Managers
As organization’s culture constrains what they can/cannot do & how they manage, it’s
particularly relevant to managers.

Types of Managerial Decisions Affected by Culture

Current issues in organizational culture

How Culture Affects Managers

•Challenge & involvement •Idea time •Debates
•Freedom •Playfulness/humor •Risk taking
•Trust and openness •Conflict resolution

Creating a Customer-Responsive Culture

=> For many companies, sustainability is developed into the organization’s overall culture
planning-organizing-leading-controlling

PART 3: PLANNING
CHAP 8: PLANNING AND GOAL-SETTING

The what and why of planning

What Is Planning?
● Planning: function involving set goals, establish strategies for achieving those goals, and develop
plans to integrate & coordinate work activities
● Formal planning:
+ Specific, time-oriented goals
+ Goals written & shared

Why Do Managers Plan?

● Provide direction
● Reduce uncertainty
● Minimize waste & redundancy
● Establish the goals & standards for controlling

Planning and Performance

● Formal planning is associated with positive financial results
● Quality of planning/implementation more important than the extent of it
● External factors can reduce the impact of planning on performance
● Planning-performance relationship seems to be influenced by the planning time frame

Goals and plans

● Goals (objectives): desired outcomes/targets
● Plans: documents outlining how goals are going to be met

Types of Goals
● Financial goals
● Strategic goals
● Stated goals: official statements of what an organization says, what it wants its various
stakeholders to believe, its goals are
● Real goals: an organization actually pursues, as defined by the actions of its members
 Types of Plans

5-year goals to expand internationally

Strategic plans: apply to the entire organization & establish the organization’s overall goals
Operational plans: encompass a particular operational area of the organization
Long-term plans: with a time frame > 3 years saving for retirement in 30 years
Short-term plans: cover ≤ 1 year family vacation for next summer.
Specific plans: clearly defined & leave no room for interpretation
Directional plans: flexible & set out general guidelines sticking to a general healthy diet.
Specific plans: a one-time plan specifically designed to meet the needs of a unique situation planning a
Standing plans: ongoing plans that provide guidance for activities performed repeatedly wedding
a department's budget for the next quarter.
morning routine for ceremony
Setting goals and developing plansgetting ready for work.

Approaches to Setting Goals

● Traditional goal-setting: top managers set goals then flow down through the
organization and become subgoals for each organizational area

The Downside of Traditional Goal-Setting

● Means-ends chain:integrated network of goals in which the accomplishment of goals at
1 level serves as the means for achieving the goals, or ends, at the next level
● Management by objectives (MBO): set mutually agreed upon goals & use those goals
to evaluate employee performance
 Steps in MBO

Well-written Goals Characteristics

Steps in goal-setting:
1. Review the organization’s mission/purpose.
2. Evaluate available resources.
3. Determine the goals individually or with input from others.
4. Write down the goals & communicate them to all who need to know.
5. Review results & whether goals are being met.

Developing Plans
● Contingency factors in planning:
+ Organizational level
+ Degree of environmental uncertainty
+ Length of future commitments

Planning and Organizational Level

 ● Environmental uncertainty: uncertainty is high, plans should be specific & flexible.
● Length of future commitments concept - plans should extend far enough to meet those
commitments made when plans were developed

Approaches to Planning
Formal planning department: a group of planning specialists whose sole responsibility is
helping to write organizational plans

Contemporary issues in planning

How Can Managers Plan Effectively in Dynamic Environments?

● Develop plans that are specific but flexible
● Keep planning even when the environment is uncertain
● Allow lower organizational levels to set goals & develop plans

How Can Managers Use Environmental Scanning?

● Environmental scanning: screen information to detect emerging trends
● Competitor intelligence: gather information about competitors allows managers to
anticipate competitors’ actions rather than merely react to them

Digital Tools
● Business intelligence: data managers use to make more effective strategic decisions
● Digital tools: technology, systems, software allow user to collect, visualize, understand,
analyze data
● Data visualization tools
● Cloud computing: store + access data on the Internet
● Internet of things (IoT): allows everyday “things” to generate, store, share data across
the Internet
 CHAP 9: STRATEGIC PLANNING

Strategic management

What Is Strategic Management?

● Strategic management: what managers do to develop the organization’s strategies.
● Strategies: plans for how the organization will do what it’s in business to do, how it will
compete successfully, how it will attract & satisfy its customers to achieve its goals
● Business model: how a company is going to make money
+ Whether customers will value what the company provide
+ Whether the company can make any money doing that

Why Is Strategic Management Important?

● positive impact on performance
● Help managers decide how to act in face of change and uncertainty
● Help complex and diverse organizations work together

The strategic management process

Step 1: Identifying the Organization’s Current Mission, Goals, and Strategies

● Mission: purpose of an organization
 Components of a Mission Statement

Step 2: Doing an External Analysis

Step 3: Doing an Internal Analysis

● Resources: organization’s assets that are used to develop, manufacture, and deliver
products to its customers
● Capabilities: an organization’s skills and abilities in doing the work activities needed in
its business
● Core competencies: the organization’s major value-creating capabilities that determine
its competitive weapons
● SWOT analysis: combine external and internal analyses
+ Strengths: does well/its unique resources
+ Weaknesses: does not do well/resources it needs but does not possess
+ Opportunities: positive trends in the external environment => put you in a
stronger competitive position
+ Threats: negative trends in the external environment => cause problems

Step 4: Formulating Strategies

3 main types:
● Corporate ● Competitive ● Functional

Step 5: Implementing Strategies

No matter how effectively an organization has planned its strategies, performance will suffer if
the strategies aren’t implemented properly.

Step 6: Evaluating Results

● How effective have strategies been at helping the organization achieve its goals
● What adjustments are necessary?
Corporate Strategies

What Is Corporate Strategy?

Corporate strategy: determines what businesses a company is in / wants to be in, what it wants
to do with those businesses

What Are the Types of Corporate Strategy?

● Growth strategy: wants to expand the number of markets served/products offered, either
through its current business(es)/new business(es)
+ Concentration + Vertical integration
+ Diversification + Horizontal integration
● Stability strategy: continues to do what it is currently doing
● Renewal strategy: address declining performance

How Are Corporate Strategies Managed?

BCG matrix: strategy tool guides resource allocation decisions based on market share & growth
rate of SBUs
Competitive strategies
● Competitive strategy: strategy for how an organization will compete in its business(es)
● Strategic business unit (SBU): single independent businesses of an organization formulate their
own competitive strategies

The Role of Competitive Advantage

Competitive advantage: What sets an organization apart; its distinctive edge
● Quality
● Design thinking
● Social media
Porter’s 5-Forces Model:
● Threat of new entrants
● Threat of substitutes
● Bargaining power of buyers
● Bargaining power of suppliers
● Current rivalry

Choosing a Competitive Strategy

3 types of competitive strategies:
● Cost leadership strategy: have the lowest costs (costs/expenses, not prices)
● Differentiation strategy: offer unique products widely valued by customers
● Focus strategy: cost advantage (cost focus)/differentiation advantage (differentiation
focus) in a narrow segment or niche
Stuck in the middle: can’t develop a cost/differentiation advantage
Functional strategies: various functional departments to support the competitive strategy

Current strategic management issues

The Need for Strategic Leadership

Strategic leadership: anticipate, envision, maintain flexibility, think strategically, work with
others to initiate changes that create a viable & valuable future for organization
 Effective Strategic Leadership

The Need for Strategic Flexibility

Strategic flexibility: recognize major external changes, quickly commit resources, recognize
when a strategic decision was a mistake

Developing Strategic Flexibility

Important Organizational Strategies for Today’s Environment

● E-Business strategies
● Customer service strategies
● Innovation strategies
+ First mover: a first organization bring a product innovation to the market or use a
new process innovation
 First Mover Advantages and Disadvantages

CHAP 10: FOSTERING ENTREPRENEURSHIP

The context of entrepreneurship

What Is Entrepreneurship?

Entrepreneurial Ventures Small Business

- Pursue opportunities - Independently owned, operated, financed

- Characterized by innovative practices - ≤ 100 employees
- Have growth and profitability as main - Not necessarily engage in any
goals new/innovative practices
- Relatively little impact on its industry

Start small but pursue growth May grow but remain small by choice / default

Entrepreneurship Versus Self-Employment?

Entrepreneurship Self-Employment

process of starting new businesses, generally Individuals working for profit or fees in their
in response to opportunities own business, profession, trade, farm
3 points of comparison:
● Both understand market needs
● Entrepreneurs may be self-employed / become employees of the company they started
● Tax requirements & certain laws require both create a legally recognized organization

Why Is Entrepreneurship Important?

● Innovation
● Number of new start-ups
● Job creation
● Global entrepreneurship

The Entrepreneurial Process

1. Explore the entrepreneurial context
2. Identify opportunities and possible competitive advantages
3. Start the venture
4. Manage the venture

What Do Entrepreneurs Do?

No 2 entrepreneurs are exactly the same. Generally, they:
● Create something new & different
● Search for, respond to, exploit change
● Research feasibility
● Launch & manage new ventures

Social Responsibility and Ethics Issues Facing Entrepreneurs

A study of small companies showed that while 95% said developing a positive reputation and
relationship in communities where they do business is important, 70% admitted that they failed
to consider community goals in their business plans.

Start-up and planning issues

Identifying Environmental Opportunities and Competitive Advantage

Sources of opportunity:
–The unexpected –The process need –Industry & market
–The incongruous structures
–Demographics –Changes in perception –New knowledge

Researching the Venture’s Feasibility—Ideas

When exploring idea sources entrepreneurs should look for:
● Limitations of what is available ● Unfilled niches
● New and different approaches ● Trends and changes
● Advances and breakthroughs

Evaluating Potential Ideas

Feasibility study: analysis of the various aspects of a proposed entrepreneurial venture designed
to determine its feasibility

Researching the Venture’s Feasibility—Competitors

Potential questions include:
● What types of products or services are competitors offering?
● What are the major characteristics of these products or services?
● What are their products’ strengths and weaknesses?
● How do they handle marketing, pricing, and distribution?
● What do they attempt to do differently from other competitors?
● Do they appear to be successful at it? Why or why not?
 ● What are they good at?
● What competitive advantage(s) do they appear to have?
● What are they not so good at?
● What competitive disadvantage(s) do they appear to have?
● How large and profitable are these competitors?

Researching the Venture’s Feasibility—Financing

Possible Financing Options

Developing a Business Plan

Business plan: written document summarizes a business opportunity, defines, articulates how
the identified opportunity is to be seized & exploited
● Executive summary ● Description of the business
=> summarize key points => describe how the venture organized
● Analysis of opportunity ● Financial data and projections
=> detailed of perceived opportunities => cover at least 3 years
● Analysis of the context ● Supporting documentation
=> broad external changes & trends => back up description with visual tools

The Sharing Economy

Sharing economy: business arrangements based on people sharing something they own or
providing a service for a fee

Organizing issues

Legal Forms of Organization

● Sole proprietorship: owner maintains sole & complete control over the business
=> personally liable for business debts
 ● General partnership: 2 or more business owners share the management & risk
● Limited liability partnership (LLP): include general partner(s)+limited liability partner(s)
● Corporation: separate from its owners & managers
● Closely held corporation: owned by a limited number of people not trade stock publicly
● S corporation: a specialized type has regular C corporation characteristics but is unique
in that the owners are taxed as a partnership as long as certain criteria are met
● Limited liability company (LLC): a hybrid between a partnership & corporation
=> Operating agreement: doc outlines the provisions governing the way LLC conduct business

Organizational Design and Structure

Organizational design decisions revolve around six key elements:
–work specialization –span of control
–Departmentalization –amount of centralization/decentralization
–chain of command –amount of formalization
Human Resource Management
● Employee recruitment => ensure the venture has the people to do the required work.
● Employee retention => keep the people who have been hired & trained

Initiating Change
If changes are needed, often the entrepreneur who first recognizes the need for change + acts as
the catalyst, coach, cheerleader, chief change consultant.

The Importance of Continuing Innovation

Innovation is a key characteristic of entrepreneurial ventures => makes the entrepreneurial
venture “entrepreneurial.”

Leading issues

Personality Characteristics of Entrepreneurs

Proactive personality: individuals are prone to take actions to influence their environments

Motivating Employees Through Empowerment

Employee empowerment => give employees the power to make decisions + take actions on their
own to solve problems => important motivational approach

The Entrepreneur as Leader

● Leading the venture
● Leading employee work teams

Control issues

Managing Growth
•Planning for growth •Organizing for growth •Controlling for growth
Managing Downturns
Boiled frog phenomenon: a perspective on recognizing performance declines that suggests
watching out for subtly declining situations

Exiting the Venture

Harvesting: exit when an entrepreneur hopes to capitalize financially on investment in venture
Business valuation methods:
•Asset valuations •Earnings valuations •Cash-flow valuations
Other important considerations:
•being prepared •screen potential buyers
•decide who sell the business •decide whether to tell employees
•consider tax implications before/after sale

PART 4: ORGANIZING
CHAP 11: ORGANIZATION DESIGN

Six elements of organizational design

● Organizing: arrange & structure work to accomplish the organization’s goals
● Organizational structure: formal arrangement of jobs within an organization
● Organizational chart: visual representation of an organization’s structure
● Organizational design: create / change an organization’s structure
 Purpose of Organizing

Work Specialization
Work specialization: divide work activities into separate job tasks

Economies and Diseconomies of Work Specialization

Departmentalization
Departmentalization: the basis by which jobs are grouped together
5 Common Forms:
=> Today: Cross-functional team: composed of individuals from various functional specialties

Chain of Command
Chain of command: line of authority extend from upper organizational to the lowest levels, which
clarifies who reports to whom
Authority: rights inherent in managerial position to tell people what to do & expect them to do it
● Line authority: entitles a manager to direct the work of an employee
● Staff authority: positions with some authority created to support, assist, advise those
holding line authority
Responsibility: obligation or expectation to perform any assigned duties
● Unity of command: each person should report to only one manager
=> Today: information technology + report to more than 1 boss

Span of Control
Span of control: number of employees a manager can efficiently & effectively manage
Traditional => 6-8 subordinates
Today => no magic number
 Contrasting Spans of Control

Centralization and Decentralization

Centralization Decentralization

● decision making is concentrated at upper levels ● lower-level employees provide input / actually make decisions

=> Today: Employee empowerment: give employees more authority (power) to make decisions

Formalization
Formalization: how standardized organization’s jobs are & the extent to which employee
behavior is guided by rules and procedures
=> Today: rely less on strict rules & standardization to guide, regulate employee’s behavior
Mechanistic and organic structures
Mechanistic organization Organic organization

● rigid and tightly controlled ● highly adaptive and flexible

Contigency factors affecting structural choice

Strategy and Structure

An organization’s structure facilitate goal achievement. As goals are an important part of the
organization’s strategies, it’s only logical that strategy and structure are closely linked

Size and Structure

An organization’s size affects its structure, but once an organization grows past a certain size,
size has less influence on structure.

Technology and Structure

● Unit production: the production of items in units or small batches
● Mass production: the production of items in large batches
● Process production: the production of items in continuous processes

Environmental Uncertainty and Structure

 ● In stable and simple environments, mechanistic designs can be more effective.
● The greater the uncertainty, the more an organization needs flexibility of organic design.

Traditional organizational design options

● Simple structure: little departmentalization, wide spans of control, centralized authority,
and little formalization
● Functional structure: groups together similar / related occupational specialties
● Divisional structure: made up of separate, semiautonomous units or divisions

Organizing for flexibility in the 21st century

Team Structures
Team structure: entire organization is made up of work teams

Matrix and Project Structures

● Matrix structure: assigns specialists from different functional departments to work on 1
or more projects
● Project structure: employees continuously work on projects
The Boundaryless Organization
● Boundaryless organization: design is not defined by, or limited to, the horizontal,
vertical, external boundaries imposed by a predefined structure
● Virtual organization: consists of a small core of full-time employees & outside
specialists temporarily hired as needed to work on projects
● Task force (ad hoc committee): temporary committee / team formed to tackle a specific
short-term problem affecting several departments
● Open innovation: open up the search for new ideas beyond organization’s boundaries &
allow innovations to easily transfer inward & outward

Benefits and Drawbacks of Open Innovation

Telecommuting
Telecommuting:work arrangement employees work at home & linked to workplace by computer

Compressed Workweeks, Flextime, and Job Sharing

● Compressed workweek: work longer hours per day but fewer days per week
● Flextime (flexible work hours): a scheduling system that employees are required to
work a specific number of hours a week but free to vary those hours within certain limits
● Job sharing: have 2 or more people split a full-time job

The Contingent Workforce

Contingent workers: temporary, freelance, contract workers whose employment is contingent
on demand for their services

CHAP 12: ORGANIZING AROUND TEAMS

Groups and group development

What Is a Group
Group: 2 or more interacting, interdependent individuals come together to achieve specific goals
● Formal groups => work groups

● Informal groups => social groups

Stages of Group Development

Forming: people join the group & define group’s purpose, structure, leadership
Storming: intragroup conflict — Norming: close relationships & cohesiveness
Performing: group is fully functional & works on group task
Adjourning: temporary groups, members wrap up activities rather than task performance
Work group performance and satisfaction

External Conditions Imposed on the Group

External conditions include:
● Organization's strategy ● Availability of resources
● Authority relationships ● Employee selection criteria
● Formal rules & regulations

Group Member Resources

•Knowledge •Abilities •Skills •Personality traits

Group Structure
● Role: behavior patterns expected of someone occupying a given position in a social unit
● Norms: standards / expectations accepted & shared by a group’s members
● Conformity:
+ Groupthink: when a group exerts extensive pressure on an individual to align his
or her opinion with others’ opinions
 Examples of Asch’s Cards
● Status systems:
+ Status: a prestige grading, position, or rank within a group
● Group size:
+ Social loafing: individuals expend less effort when working collectively than
when working individually
● Group cohesiveness: group members are attracted to 1 another & share the group’s goals

Group Cohesiveness and Productivity

Group Processes

GROUP DECISION MAKING

● Advantages: ● Disadvantages:
–Generate more complete information & –Take more time
knowledge –A dominant minority can unduly influence
–Increase acceptance of a solution outcome; groupthink
–Increase legitimacy –Individual responsibilities are ambiguous
 Creative Group Decision Making

CONFLICT MANAGEMENT
● Conflict: perceived incompatible differences result in interference / opposition
+ Traditional view of conflict: all conflict is bad & must be avoided
+ Human relations view of conflict: conflict is natural & inevitable outcome in any group
● Interactionist view of conflict: some conflict is necessary to group perform effectively
+ Functional conflicts: support a group’s goals & improve its performance
+ Dysfunctional conflicts: prevent a group from achieving its goals

Conflict and Group Performance

Types of conflict:
● Task conflict: content & goals of the work
● Relationship conflict: based on interpersonal relationships
● Process conflict: how work gets done
Group Tasks
It’s the complexity & interdependence of tasks that influence a group’s effectiveness.

Turning groups into effective teams

The Difference Between Groups and Teams

Work teams: members work intensely on a specific, common goal using their positive synergy,
individual and mutual accountability, complementary skills

Types of Work Teams

● Problem-solving team: same department / functional area that’s involved in efforts to
improve work activities or to solve specific problems
● Self-managed work team: operates without a manager & responsible for a complete
work process / segment
● Cross-functional team: composed of individuals from various functional specialties
● Virtual team: technology to link physically dispersed members to achieve common goal
Creating Effective Work Teams

Characteristics of Effective Teams

Contemporary challenges in managing teams

Managing Global Teams

● Member resources in global teams ● Processes

● Structure ● Manager’s role

Building Team Skills

Managers must view their role as more of being a coach and developing team members to create
more committed, collaborative, inclusive teams.

Understanding Social Networks

Social network structure: patterns of informal connections among individuals within a group
 CHAP 13: HUMAN RESOURCE MANAGEMENT

Why HRM is important and the HRM process

Important because:
● a significant source of competitive advantage
● an important part of organizational strategies
● The way organizations treat their people can significantly impact performance
High-performance work practices: lead to both high individual + organizational performance

HRM Process:

External factors that affect the HRM process

The Economy
Lasting impact of the Great Recession
Labor Unions
Labor union: represents workers & seeks to protect their interests through collective bargaining

Laws and Rulings

Affirmative action: Organizational programs enhance the status of members of protected groups

Major HRM Laws

Global HRM:
● Work councils: groups of nominated/elected employees be consulted when management
makes decisions involving personnel
● Board representatives: employees sit on a company’s board of directors & represent the
interests of the firm’s employees
Demography
● Oldest, most experienced workers (born before 1946) make up 6% of the workforce
● Baby boomers make up 41.5% of the workforce
● Gen Xers make up almost 29% of the workforce
● Gen Yers make up almost 24% of the workforce

Identifying and selecting competent employees

Human Resource Planning

HR planning: ensure right number & kinds of capable people in right places & at right times
2 steps:
1. Assessing current human resources:
+ Job analysis: defines jobs & behaviors necessary to perform them
+ Job description (position description): written statement describes a job
+ Job specifications: written statement of minimum qualifications a person must
possess to perform a given job successfully
2. Meeting future HR needs:
+ Determined by the organization’s mission, goals, and strategies.
+ Not carefully scrutinize the qualifications / backgrounds of employees surely pose
risks of increased liability, poor reputation, lower performance.

Recruitment and Decruitment

Recruitment: locating, identifying, attracting capable applicants
 Recruiting Sources
Decruitment: reducing an organization’s workforce

Decruitment Options

Selection
Selection: screen job applicants to ensure the most appropriate candidates are hired
 Selection Decision Outcomes
● Valid selection device: proven relationship between selection device & relevant criterion.
● Reliable selection device: measures the same thing consistently.

Selection Tools
Realistic job preview (RJP): provides positive & negative information about job & company
Providing employees with needed skills and knowledge

Orientation
Orientation: introduce a new employee to his / her job and the organization
● Work unit orientation: familiarize employee with goals of the work unit, clarifies how
his/her job contributes to unit’s goals, includes an introduction to his/her new coworkers.
● Organization orientation: informs new employee about the company’s goals, history,
philosophy, procedures, rules, include relevant HR policies + even a tour of the facilities.

Employee Training

Traditional Training Methods:

Technology-Based Training Methods

Retaining competent, high-performing employees

Employee Performance Management

Performance management system: establishes standards to evaluate employee performance
 Performance Appraisal Methods

Compensation and Benefits

● Skill-based pay: rewards employees for the job skills they can demonstrate
● Variable pay: individual’s compensation is contingent on performance
 What Determines Pay and Benefits

Contemporary issues in managing human resources

Managing Downsizing
Downsizing: planned elimination of jobs in an organization

Tips for Managing Downsizing

Managing Sexual Harassment

Sexual harassment: any unwanted action/activity of a sexual nature that explicitly/implicitly
affects an individual’s employment, performance, work environment

Controlling HR Costs
● Employee health-care costs
● Employee pension plan costs
 PART 5: LEADING
CHAP 14: INTERPERSONAL AND ORGANIZATIONAL
COMMUNICATION

The nature and function of communication

What Is Communication?
Communication: transfer & understanding of meaning
● Interpersonal communication: communication between 2 or more people
● Organizational communication: all the patterns, networks, systems of communication
within an organization

Functions of Communication
•Control •Motivation •Emotional expression •Information

Methods and challenges of interpersonal communication

Methods
● Message: a purpose to be conveyed
+ Encoding: convert a message into symbols
+ Channel: the medium a message travels along
+ Decoding: retranslate a sender’s message
● Communication process: 7 elements to transfer meaning from 1 person to another
+ Noise: any disturbances that interfere with the transmission, receipt, or feedback
of a message

The Interpersonal Communication Process

Which Communication Method Should Be Used?
Feedback Confidentiality Time-space constraint Formality
Complexity capacity Encoding ease Cost Scanability
Breadth potential Decoding ease Interpersonal warmth Time of consumption
● Nonverbal communication: communication transmitted without words
+ Body language: gestures, facial configurations, other body movements
+ Verbal intonation: emphasis given to words / phrases

Comparisons of Communication Methods

 Barriers
•Cognitive •Emotions •Sociocultural •National culture
+ Information overload: information exceeds + Jargon: specialized terminology/
our processing capacity technical language members of a
+ Filtering: deliberate manipulation of group use to communicate among
information to make it appear more favorable themselves
to the receiver

Overcoming the Barriers

•Use feedback •Constrain emotions
•Simplify language •Watch nonverbal cues
•Listen actively: listen for full meaning without making premature judgments/interpretations

Effective organizational communication

Formal Versus Informal

Formal communication Informal communication
takes place within prescribed organizational not defined by the organization’s structural
work arrangements hierarchy

Direction of Flow
● Downward: flows downward from a manager to employees
+ Town hall meeting: informal public meetings where information can relayed,
issues can discussed, employees brought together to celebrate accomplishments
● Upward communication: flows upward from employees to managers
● Lateral communication: takes place among employees on the same organizational level
● Diagonal communication: cuts across work areas and organizational levels
Networks
Communication networks: various patterns of vertical & horizontal flows of organizational
communication
● Chain network: flows based on formal chain of command, both downward & upward.
● Wheel network: flowing between a clearly identifiable & strong leader & others in a
work group/team => leader serves as the hub through whom all communication passes.
● All-channel network: flows freely among all members of a work team

Grapevine: informal organizational communication network

Workplace Design and Communication

● Open workplaces: few physical barriers & enclosures

Communication in the Internet and social media age

The 24/7 Work Environment

● IT => stay connected around the clock, 7 days/week.
● IT => people in organizations to be fully accessible, at any time, anywhere

Working from Anywhere

Wireless communication technology improve work for managers & employees

Social Media
● Devote a channel for information exchange about a specific topic can help
compartmentalize the conversation.
● Start a useful conversation in which employees can share their experiences and make
suggestions for creating competitive advantage.
Balancing the Pluses and Minuses
● Communication & the exchange of information among organizational members are no
longer constrained by geography or time.
● Constantly staying connected has its downsides, such as impeding creativity.

Choosing the Right Media

It’s important for managers to understand the situations in which 1 or more media facilitates
effective communication.

Communication issues in today’s organizations

Managing Communication in a Digitally Connected World

● Legal and security issues ● Personal interaction

Managing the Organization’s Knowledge Resources

Managers enable employees to communicate & share knowledge to learn from each other.

The Role of Communication in Customer Service

The 3 components:
1. Customer 2. Service organization 3. Individual service provider

Getting Employee Input

Let employees know that their opinions matter is an essential 1st step in building effective
suggestions systems.

How to Let Employees Know Their Input Matters

Communicating Ethically
Ethical communication: include all relevant information, is true in every sense, and is not
deceptive in any way

Becoming a better communicator

Sharpening Your Persuasion Skills

Persuasion skills: enable a person to influence others to change their minds / behavior

Sharpening Your Speaking Skills

Speaking skills: refer to communicate information & ideas in talking so others will understand
Characteristics in effective speakers:
•Authenticity •Humility •Brevity •Clear understanding of audience

Sharpening Your Writing Skills

Writing skills: entail communicating effectively in text as appropriate for audience’s need
=> Abbreviations & jargon that are standard in texting among friends and family are not
always appreciated in a business setting.
Some additional points:
● Don’t be in a rush to press the send button/drop the memo in the mail.
● Express information & ideas logically, don’t switch back & forth between topics.
● Check the accuracy of the content.
● Read the message carefully to ensure an inaccurate word for the context doesn’t slip in.

Sharpening Your Reading Skills

Reading skills:entail an understanding of written sentences & paragraphs in work-related docs

CHAP 15: ORGANIZATIONAL BEHAVIOR

Focus and goals of organizational behavior

● Behavior: actions of people
● Organizational behavior (OB): study of people actions at work
 Organization as Iceberg

Focus of Organizational Behavior

• Individual behavior • Group behavior • Organizational aspect

Goals of Organizational Behavior

The goals of OB:
● Explain => why employees engage in some behaviors rather than others
● Predict => how employees will respond to various actions and decisions
● Influence => how employees behave
6 important employee behaviors:
● Employee productivity: performance measure both efficiency & effectiveness
● Absenteeism: failure to show up for work
● Turnover: voluntary & involuntary permanent withdrawal from an organization
● Organizational citizenship behavior (OCB): discretionary behavior that is not part of an
employee’s formal job requirements, but promotes effective functioning of organization
● Job satisfaction: employee’s general attitude toward his/her job
● Counterproductive workplace behavior: any intentional employee behavior that is
potentially damaging to organization/individuals within the organization

Attitudes and job performance

Attitudes: evaluative statements, favorable/unfavorable, concern objects, people, events
3 components:
● Cognitive: made up of the beliefs, opinions, knowledge, information held by a person
● Affective: emotional/feeling part
● Behavioral: refer to an intention to behave in a certain way toward someone/something
Job Satisfaction
● High level of satisfaction = positive attitude Dissatisfaction = negative attitude
● Linked to:
–Productivity –Turnover –OCB
–Absenteeism –Customer satisfaction –Counterproductive behavior

Job Involvement and Organizational Commitment

● Job involvement: employee identifies with his/her job, actively participates in it,
considers his/her job performance to be important to self-worth
● Organizational commitment: employee identifies with a particular organization, its
goals & wishes to maintain membership in that organization
● Perceived organizational support: employees’ general belief that their organization
values their contribution & cares about their well-being

Employee Engagement
Employee engagement: employees are connected to, satisfied with, enthusiastic about their jobs
=> Highly engaged employees are passionate about & deeply connected to their work.
=> Disengaged employees have essentially “checked out” & don’t care => show up for
work, but have no energy/passion for it.

Attitudes and Consistency

People generally seek consistency among their attitudes, between their attitudes & behavior;
reconcile differing attitudes, align their attitudes & behavior so they appear rational & consistent.

Cognitive Dissonance Theory

Cognitive dissonance: any incompatibility/inconsistency between attitudes/behavior & attitudes
Reduce dissonance is determined by 3 things:
1. Importance of the factors creating the dissonance,
2. Degree of influence the individual believes he/she has over those factors
3. Rewards that may be involved in dissonance.

Attitude Surveys
Attitude surveys: elicit responses from employees through questions about how they feel about
their jobs, work groups, supervisors, organization
Implications for Managers
Managers should be interested in their employees’ attitudes because they influence behavior.

Personality
Personality: unique combination of emotional, thought, behavioral patterns affect how a person
reacts to situations & interacts with others

MBTI®
The MBTI®, a popular personality-assessment instrument, classifies individuals as 4 categories:
● Extraversion or introversion (E or I)
● Sensing or intuition (S or N)
● Thinking or feeling (T or F)
● Judging or perceiving (J or P)

Examples of MBTI® Personality Types

The Big Five Model
5 personality traits in the Big Five Model are:
1. Extraversion: be sociable, talkative, assertive, comfortable in relationships with others.
2. Agreeableness: be good-natured, cooperative, trusting.
3. Conscientiousness: reliable, responsible, dependable, persistent, achievement-oriented.
4. Emotional stability: be calm, enthusiastic, secure (positive) / tense, nervous, depressed,
insecure (negative).
5. Openness to experience: a wide range of interests & imaginative, fascinated with
novelty, artistically sensitive, intellectual

Additional Personality Insights

5 other personality traits are powerful predictors:
● Locus of control: people believe they control their own fate
● Machiavellianism: people are pragmatic, maintain emotional distance, believe that ends
justify means
● Self-esteem: individual’s degree of like or dislike for himself or herself
● Self-monitoring: adjust behavior to external situational factors
● Risk-Taking: willingness to take chances
Other personality traits:
● Proactive personality: individuals prone to take actions to influence their environments
● Resilience: overcome challenges & turn them into opportunities

Personality Types in Different Cultures

No personality type is common for a given country, yet a country’s culture influences the
dominant personality characteristics of its people

Emotions and Emotional Intelligence

Emotions: intense feelings directed at someone/something
Emotional intelligence (EI): notice + manage emotional cues & information
5 Dimensions of Emotional Intelligence:
•Self-awareness •Self-management •Self-motivation •Empathy •Social skills

Implications for Managers

Managers are likely to have higher-performing & more satisfied employees if consideration is
given to matching personalities with jobs
Perception
Perception: give meaning to our environment by organizing & interpreting sensory impressions

Factors That Influence Perception

A number of factors act to shape & distort perception including:
● Perceiver ● Target ● Situation

Attribution Theory
Attribution theory: how we judge people differently depend on what meaning we attribute to a
given behavior
Attribution depends on 3 factors:
● Distinctiveness => individual displays different behaviors in different situations
● Consensus => faced with a similar situation responds in the same way
● Consistency => an observer looks for consistency in a person’s actions
 ● Fundamental attribution error: underestimate the influence of external factors &
overestimate the influence of internal / personal factors
● Self-serving bias: individuals to attribute their successes to internal factors while
blaming personal failures on external factors

Shortcuts Used in Judging Others

● Assumed similarity: assumption that others are like oneself
● Stereotyping: judge a person based on perception of a group to which that person belongs
● Halo effect: general impression of an individual based on a single characteristic

Implications for Managers

Managers need to recognize that their employees react to perceptions, not to reality.

Learning
Learning: any relatively permanent change in behavior that occurs as a result of experience

Operant Conditioning
Operant conditioning: behavior is a function of its consequences

Social Learning
Social learning theory: people can learn through observation & direct experience
4 processes:
1. Attentional => recognize and pay attention to its critical features
2. Retention => how well the individual remembers the model’s action, even after the
model is no longer readily available.
3. Motor reproduction => individual can actually do the modeled activities.
4. Reinforcement => be motivated to exhibit the modeled behavior if positive incentives /
rewards are provided

Shaping: A Managerial Tool

Shaping behavior: guide learning in graduated steps using reinforcement / lack of reinforcement
4 ways:
•Positive reinforcement •Negative reinforcement •Punishment •Extinction
Implications for Managers
Employees are going to learn on the job: are managers going to manage their learning through
the rewards they allocate and the examples they set, or allow it to occur haphazardly?

CHAP 16: LEADERSHIP

Who are leaders and what is leadership?

● Leader: someone who can influence others & has managerial authority
● Leadership: a process of influencing a group to achieve goals

Early leadership theories

Leadership Traits
● Research focused on identifying personal characteristics differentiated leaders from
non-leaders was unsuccessful who can influence others & who has managerial authority.
● Impossible to identify a set of traits that would always differentiate a leader (the person)
from a nonleader of influencing a group to achieve goals.

8 Traits Associated with Leadership

Leadership Behaviors
Behavioral theories: identify behaviors differentiate effective leaders from ineffective leaders
Contingency theories of leadership

The Fiedler Model

Fiedler contingency model: effective group performance depends on the proper match between
a leader’s style & the degree to which the situation allows the leader to control + influence
Least-preferred coworker (LPC) questionnaire: whether a leader is task/relationship oriented
Fiedler’s Situational Contingencies:
● Leader–member relations: confidence, trust, respect employees have for their leader
● Task structure: job assignments are formalized and structured
● Position power: influence a leader has over activities such as hiring, ring, discipline,
promotions, salary increases

Hersey and Blanchard’s Situational Leadership Theory

Situational leadership theory (SLT): contingency theory that focuses on followers’ readiness
Readiness: describes the degree to which job assignments are formalized & structured
4 specific leadership styles:
● Telling (high task–low relationship): defines roles & tells people what, how, when, and
where to do various tasks.
● Selling (high task–high relationship): provides both directive & supportive behavior.
● Participating (low task–high relationship): leader & followers share in decision making;
main role of leader is facilitating & communicating.
● Delegating (low task–low relationship): provides little direction/support
4 stages of follower readiness:
● R1: unable & unwilling to take responsibility for doing something
=> Followers aren’t competent/confident.
● R2: unable but willing to do the necessary job tasks
=> Followers are motivated but lack the appropriate skills.
● R3: able but unwilling to do what the leader wants
=> Followers are competent, but don’t want to do something.
● R4: able & willing to do what is asked of them

Path-Goal Model
Path-goal theory: leader’s job is to assist followers in attaining their goals & provide direction
/support needed to ensure their goals are compatible with the goals of the group/organization
4 leadership behaviors:
● Directive: what’s expected of subordinates, schedules work, gives specific guidance
● Supportive: shows concern for the needs of followers & is friendly.
● Participative: consults with group members & use their suggestion to make decision.
● Achievement-oriented: set challenging goal/expect followers to perform at highest level

Contemporary view of leadership

4 of these views: Leader–member exchange theory; Transformational-transactional leadership;
Charismatic-visionary leadership; Team leadership
Leader–Member Exchange (LMX) Theory
Leader-member exchange theory (LMX): leaders create in-groups & out-groups, those in the
in-group have higher performance ratings, less turnover, greater job satisfaction

Transformational-Transactional Leadership
Transactional leader: lead primarily by using social exchanges (transactions)
Transformational leader: stimulate, inspire (transform) followers to achieve extraordinary outcome

Charismatic-Visionary Leadership
Charismatic leader: an enthusiastic, self-confident leader whose personality & actions influence
people to behave in certain ways
Visionary leadership: create & articulate a realistic, credible, attractive vision of the future that
improves upon the present situation

Authentic Leadership
Authentic leadership: know who they are, what they believe in, act on those values & beliefs
openly & candidly

Ethical Leadership
An ethical leader puts public safety ahead of profits, holds culpable employees accountable,
creates a culture in which employees feel that they could & should do a better job

Team Leadership
● Many leaders are not equipped to handle the change to employee teams.
● 2 priorities:
+ Managing team’s external boundary
+ Facilitating team process
Leadership issues in the twenty-first century

Managing Power
5 sources:
● Legitimate power:as a result of his/her position in the organization
● Coercive power: punish or control
● Reward power: give positive rewards
● Expert power: pbased on expertise, special skills, knowledge
● Referent power: arises because of a person’s desirable resources/personal traits

Developing Trust
Credibility: followers perceive someone as honest, competent, able to inspire
Trust: belief in the integrity, character, ability of a leader
5 dimensions:
● Integrity: honesty & truthfulness => most critical to assess another’s trustworthiness
● Competence: technical & interpersonal knowledge/skills
● Consistency: reliability, predictability, good judgment in handling situations
● Loyalty: willingness to protect a person, physically & emotionally
● Openness: willingness to share ideas & information freely

Empowering Employees
Empowerment increase decision-making discretion of workers. Millions of individual employees
& employee teams are making the key operating decisions that directly affect their work.

Leading Across Cultures

● Effective leaders do not use a single style, but adjust their style to the situation.
● National culture is certainly an important situational variable in determining which
leadership style will be most effective.
 Cross-Cultural Leadership Examples

Becoming an Effective Leader

● Leader training
● Substitutes for leadership

CHAP 17: MOTIVATION

What is motivation?
Motivation: person’s reports are energized, directed, sustained toward attaining a goal

Early theories of motivation

Maslow’s Hierarchy of Needs Theory

Hierarchy of needs theory: Maslow’s theory that human needs - physiological, safety, social,
esteem, and self-actualization - form a sort of hierarchy
 1. Physiological needs: needs for food, drink, shelter, sex, other physical requirements.
2. Safety needs: needs for security & protection from physical/emotional harm & assure
that physical needs will continue to be met.
3. Social needs: needs for affection, belongingness, acceptance, friendship.
4. Esteem needs: needs for internal esteem factors (selfrespect, autonomy, achievement) &
external esteem factors (status, recognition, attention)
5. Self-actualization needs: needs for growth, achieving one’s potential, self-fulfillment; the
drive to become what one is capable of becoming.
=> Physiological + safety needs: lower-order needs
=> Social, esteem, self-actualization needs: higherorder needs.
❖ Lower-order needs are predominantly satisfied externally while higher-order needs are
satisfied internally

McGregor’s Theory X and Theory Y

Theory X: employees dislike work, are lazy, avoid responsibility, must be coerced to perform
Theory Y: employees are creative, enjoy work, seek responsibility, can exercise self-direction

Herzberg’s Two-Factor Theory

Two-factor theory (motivation-hygiene theory): intrinsic factors are related to job satisfaction
& motivation, whereas extrinsic factors are associated with job dissatisfaction
● Hygiene factors: eliminate job dissatisfaction, but don’t motivate
● Motivators: increase job satisfaction & motivation

Contrasting views of satisfaction and dissatisfaction:

Three-Needs Theory
Three-needs theory: 3 acquired (not innate) needs - achievement, power, affiliation - are major
motives in work
● Need for achievement (nAch): drive to succeed & excel in relation to a set of standards
● Need for power (nPow): need to make others behave in a way they not behave otherwise
● Need for affiliation(nAff): desire for friendly & close interpersonal relationships

All 3 of these needs measured by using a projective test (the Thematic Apperception Test/TAT)

Contemporary theories of motivation

Goal-Setting Theory
Goal-setting theory: the proposition that specific goals increase performance & that diffcult
goals, when accepted, result in higher performance than do easy goals

Self-efficacy: an individual’s belief that he or she is capable of performing a task

Reinforcement Theory
Reinforcement theory: behavior is a function of its consequences
=> ignore goals, expectations, needs, but focuse solely on what happens to a person when he or
she does something.
Reinforcers: consequences immediately following a behavior, increase the probability the
behavior will be repeated

Designing Motivating Jobs

Job design: the way tasks are combined to form complete jobs
Job enlargement: horizontal expansion of a job by increasing job scope
● Job scope: number of different tasks required in a job & frequency with which those
tasks are repeated
Job enrichment: vertical expansion of a job by adding planning + evaluating responsibilities
● Job depth: degree of control employees have over their work
Job characteristics model (JCM): framework for analyzing + designing jobs that identifies 5
primary core job dimensions, their interrelationships, their impact on outcomes

JCM model
5 core job dimensions:
1. Skill variety: requires a variety of activities so employee use a number of different skills
& talents.
2. Task identity: requires completion of a whole & identifiable piece of work.
3. Task significance: job has a substantial impact on the lives/work of other people.
4. Autonomy: job provides substantial freedom, independence, discretion to the individual
in scheduling the work + determining the procedures to be used in carrying it out.
5. Feedback: doing work activities required by a job results in an individual obtaining direct
& clear information about the effectiveness of his/her performance
Redesigning job design approaches:
● Relational perspective of work design: focuses on how people’s tasks & jobs are
increasingly based on social relationships
 ● Proactive perspective of work design: employees take the initiative to change how their
work is performed => High-involvement work practices: elicit greater input/involvement
from workers

Equity Theory
Equity theory: employee compares his/her job’s input-outcomes ratio with that of relevant
others, then corrects any inequity. Focus on:
● Distributive justice: fairness of the amount & allocation of rewards among individuals
● Procedural justice: fairness of the process used to determine the distribution of rewards

Referents: person, system, selves against which individuals compare themselves to assess equity

Expectancy Theory
Expectancy theory: individual tends to act in a certain way based on expectation that the act
will be followed by a given outcome + on the attractiveness of that outcome to the individual

3 variables/relationships:
1. Expectancy or effort–performance linkage: probability perceived by individual that
exerting a given amount of effort will lead to a certain level of performance.
2. Instrumentality or performance–reward linkage: individual believes that performing at
a particular level is instrumental in attaining the desired outcome.
3. Valence or attractiveness of reward: individual places on the potential outcome/reward
can be achieved on the job. Valence considers goals & needs of individual.
 Integrating Contemporary Theories of Motivation

Current issues in motivation

Managing Cross-Cultural Motivational Challenges

● In today’s global business environment, managers can’t assume motivational programs
that work in one location will work in others.
● Most current motivation theories were developed in the United States by Americans and
about Americans.

Motivating Unique Groups of Workers

● Diverse employees/workforce => Flexibility
•Compressed workweeks •Flextime •Job sharing •Telecommuting
● Professionals
•Finding solutions to problems •Job challenge •Support •Perception that their work is important
 ● Contingent workers
+ Opportunity to become a permanent + Opportunity for training
employee + Equity in compensation and benefits
● Low-skilled minimum wage employees
+ Employee recognition program + Provision of sincere praise

Designing Appropriate Rewards Programs

● Open-book management: a motivational approach in which an organization’s nancial
statements (the “books”) are shared with all employees
● Employee recognition programs: personal attention & expressing interest, approval,
appreciation for a job well done
● Pay-for-performance programs: variable compensation plans pay employees on the
basis of some performance measure

PART 6: CONTROLLING
CHAP 18: CONTROLLING ACTIVITIES & OPERATIONS

What is controlling and why is it important?

Controlling: monitoring, comparing, and correcting work performance
Reasons Control is important:
•Planning •Empowering employees •Protecting the workplace

Planning-Controlling Link
The control process

Step 1: Measuring Actual Performance

● How we measure => personal observation, statistical report, oral report, written report

● What we measure

Step 2: Comparing Actual Performance Against the Standard

Range of variation: acceptable parameters of variance between actual performance & standard
 Green Earth Gardening Supply - June Sales

Step 3: Taking Managerial Action

Correct actual performance:
● Immediate corrective action: corrects problems at once to get performance back on track
● Basic corrective action: looks at how & why performance deviated before correcting the
source of deviation
Revise the standard:
● If performance consistently exceeds the goal, a manager look at whether the goal is too
easy & needs to be raised.
● Managers must be cautious about revising a standard downward.

Managerial Decisions in Controlling

Depending on the results, a manager’s decision is to do nothing, correct the performance, revise
the standard.
Controlling for organizational and employee performance

What Is Organizational Performance?

Performance:end result of an activity
Organizational performance: accumulated results of all the organization’s work activities

Measures of Organizational Performance

Productivity: amount of goods/services produced divided by inputs needed to generate output
=> Output = selling price x number sold
Organizational effectiveness: how appropriate organizational goals are & how well those goals
are being met

Popular Industry and Company Rankings

Controlling for Employee Performance

● Delivery effective performance feedback
● Using disciplinary actions
Disciplinary action: taken by manager to enforce organization’s work standards & regulations
Progressive disciplinary action: ensure the minimum penalty appropriate to offense is imposed

Types of Discipline Problems and Examples of Each

 Tools for measuring organizational performance

Feedforward/Concurrent/Feedback Controls
● Feedforward control: occur before a work activity is done
● Concurrent control: occur while a work activity is in progress
=> Management by walking around: when a manager is out in the work area interacting
directly with employees
● Feedback control: occur after a work activity is done

Types of Control

Financial Controls
Traditional controls:
● Ratio analysis: tan dung
+Liquidity +Leverage +Activity +Profitability
how fast can convert
asset into money● Budget analysis: lech huong
+ Quantitative standards + Deviations

Popular Financial Ratios

ti le

asset = property
Information Controls
Management information system (MIS): provide management with needed information on a
regular basis => focuses specifically on providing managers with information (processed,
analyzed data)
=> MIS implies order, arrangement, purpose

Balanced Scorecard
Balanced scorecard: looks at more than just the financial perspective
4 areas:
● Financial ● Internal processes ● People/innovation/
● Customer growth assets

Benchmarking of Best Practices

Benchmarking: looks at more than just the nancial perspective, among competitors/noncompetitors
lead to their superior performance
Benchmark: the standard of excellence against which to measure and compare

Suggestions for Internal Benchmarking

Contemporary issues in control

= chaos
Adjusting Controls for Cross-Cultural Differences and Global Turmoil
● Distance creates formalized controls, e.g. formal reports
 ● Impact of technology
● Constraints due to local laws
● Comparability issues in data collection
● Be prepared for global turmoil and disasters

Workplace Privacy
● Employers can read your e-mail, tap your telephone, monitor your work by computer,
store & review computer files.
● Reasons companies monitor:
+ Productivity/Internet traffic
+ Concerns about offensive/inappropriate material
+ Protecting company secrets

Employee Theft
Employee theft: any unauthorized taking of company property by employees for personal use

Controlling Employee Theft

Workplace Violence

Controlling Workplace Violence

Controlling Customer Interactions

Service profit chain: service sequence from employees to customers to profit
Corporate Governance
Corporate governance: system used to govern a corporation so the interests of corporate
owners are protected
● The role of boards of directors
● Financial reporting and the audit committee