PCRINCIPLES OF

MANAGEMENT

Chapter: Lecturer: Dr. Sayed Abdul

02 Moiz

Text Book: Fundamentals of Management 8 th Edition Ricky W. Griffin

Reference Book 01: Contemporary Management 3rd Edition Gareth R.
Jones & Jennifer M. George
Reference Book 02: Heinz Weihrich and Harold Koontz. 10th edition: A
global Perspective
 CHAPTER TWO

The Manager as a Planner and

Strategist.

Management and Society: The external

environment, social responsibility, and
Ethics
CHAPTER OUTCOME
Differentiate between the Internal and External
environments.
Differentiate between the task and general
environments.
Identify the main forces in both the global task
and general environments, and describe the
challenges that each force presents to managers.
Be able to discuss why national cultures differ and
why it is important that managers be sensitive to.
THE PLANNING PROCESS

• Planning is the process used by

managers to identify and select goals
for the organization.

• The pattern of decisions managers take

to reach these goals is the organization’s
strategy.
THREE STAGES OF THE PLANNING
PROCESS
Determining the Organization’s
mission and goals
(Define the business)

Strategy formulation
(Analyze current
situation &
develop strategies)

Strategy Implementation
(Allocate resources &
responsibilities
to achieve strategies)
 THREE STAGES OF THE PLANNING PROCESS
(CONT’D)
• Organizational Mission: Defined in the
mission statement which is a broad
declaration of the important purpose.
The mission statement reveals how the
organization differs from competitors.

• Formulating strategy: Managers analyze

current situation and develop strategies
needed to achieve the mission.

• Implementing strategy: Managers must

decide how to allocate resources
between groups to ensure the strategy is
achieved.
 MISSION STATEMENT

Compan Mission Statement

y
Compaq, along with our partners, will
deliver compelling products and services
of the highest quality that will transform
Compaq computing into a natural experience that
extends human capability in terms of
communication, education, work and play.

We are dedicated to being the world’s

best at bringing people together -- giving
AT&T
them easy access to each other and to
the information and services they want
and need -- anytime, anywhere.
 LEVELS OF PLANNING

Corporate-level: Decisions made by top

managers.
Considers on which businesses or markets to be
in.

Business-level: Details divisional long-term

goals and structure.
Identifies how this business meets corporate
goals.
Shows how the business will compete in market.

Functional-level: Actions taken by managers

in departments of manufacturing, marketing,
etc.
PLANNING AT A & D COMPANY
CEO
Corpora
te Corporate
Level Office

Busine
ss
A&D A&D A&D A&D A&D
Level Aircra Lightin Motor Plasti Radio
ft g s cs s

Function
al Manufacturi Accounti
Level ng ng
Marketi R&
ng D
CHARACTERISTICS OF PLANS
Long-term: Plans are usually 5 years or
more.

Intermediate-term: Plans are 1 to 5 years.

Corporate and business level plans
specify long and intermediate term.

Short-term: Plans are less than 1 year.

Functional plans focus on short to
intermediate term.
 TYPES OF PLANS

⚫ Standing Plans: For programmed decisions.

⚫ Managers develop policies and rules.

⚫ Single-use Plans: Developed for a one-time and

non-programmed issues.
 WHY PLANNING IS IMPORTANT

Planning determines where the

organization is now and where it will be in
the future. Good planning provides:
Participation: All managers are involved in
setting future goals.

Sense of direction & purpose: Planning

sets goals for all managers.

Control: Plans specify who is in charge of

accomplishing a goal.
ORGANIZATION

Collection of people who work together and

coordinate their actions to achieve the
organization goals.
CHARACTERISTICS OF ORGANIZATION
ORGANIZATIONAL ENVIRONMENT

An organization’s environment is defined as

‘’all the elements surrounding the
organization that have the potential to affect
all or part of the organization’’.
TYPES OF ENVIRONMENT

External Environment
Internal Environment
EXTERNAL ENVIRONMENT

Everything outside an organization’s

boundaries that might affect it.

There are two types of external environments

General environment
Task environment
 GENERAL ENVIRONMENT

Economic
Technological Socio-cultural

Forces

Demographi Political and Legal

c
GENERAL ENVIRONMENT
Economic Forces
Interest rates, inflation, unemployment,
economic growth, and other factors that
affect the general health and well-being of a
country or world region.
GENERAL ENVIRONMENT (CONTINUED…)

Successful managers realize the important

effects that economic forces have on their
organizations.

Pay close attention to what is occurring in

the national and regional economies to
respond appropriately.
GENERAL ENVIRONMENT (CONTINUED…)
Technology
Combination of tools, machines, computers, skills,
information, and knowledge that managers use in
the design, production, and distribution
of goods and services.
GENERAL ENVIRONMENT (CONTINUED…)

Technological Forces
Outcomes of changes in the technology that
managers use to design, produce, or distribute
goods and services.
Results in new opportunities or threats to managers
Often makes products obsolete very quickly.
GENERAL ENVIRONMENT (CONTINUED…)
Socio-cultural Forces
Pressures emanating from the social structure of a
country or society.
Social structure: the arrangement of
relationships between individuals and groups in
society.
National culture: the set of values that a society
considers important and that are approved or
sanctioned in that society.
Effective managers are sensitive to differences
between societies and adjust their behaviors
accordingly.
GENERAL ENVIRONMENT
(CONTINUED…)
Demographic Forces
The study of human population is called
Demography. And its statistical
representation is known as demographics.

1-Size 2-Location
3-Age 4-Gender
5-Income 6-Occupation
7-Education
GENERAL ENVIRONMENT
(CONTINUED…)
Political and Legal Forces
Outcomes of changes in laws such as the
increased emphasis on environmental protection
etc.
Task Environment

Set of forces that originate with

suppliers, distributors, customers,
regulators and competitors.
TASK ENVIRONMENT (CONTINUED…)
Suppliers
Individuals and organizations that provide an
organization with the input resources that it needs
to produce goods and services
• Raw materials, component parts, labor (employees)
etc.
TASK ENVIRONMENT (CONTINUED…)

– Relationships with suppliers can be difficult due

to materials shortages etc.
• Suppliers that are the sole source of a critical item are
in a strong bargaining position to raise their prices.
– Managers can reduce these supplier effects by
increasing the number of suppliers of an input.
 TASK ENVIRONMENT (CONTINUED…)

Distributors
Organizations that help other organizations sell their
goods or services to customers.
• Managers can counter the effects of distributors by
seeking alternative distribution channels.
TASK ENVIRONMENT (CONTINUED…)

Customers
Individuals and groups that buy goods and
services that an organization produces
• Identifying an organization’s main customers and
producing the goods and services they want is
crucial to organizational and managerial success.
TASK ENVIRONMENT (CONTINUED…)

Competitors
Organizations that produce goods and/or services
that are similar to a particular organization’s goods
and services.
TASK ENVIRONMENT (CONTINUED…)

Regulators
A unit that has the potential to control,
legislate, or otherwise influence the
organization’s policies and practices.
INTERNAL ENVIRONMENT
The internal environment of an organization
is consist of the following elements:
Owners
Boards of directors
Employees
Physical work environment
INTERNAL ENVIRONMENT (CONTINUED…
Owner
Whoever has the property right of an organization.
INTERNAL ENVIRONMENT
(CONTINUED…)
Board of directors
These member are elected by shareholders and
charged with overseeing the general management
of a firm to ensure that is being run in a way that
best serves the shareholders.
INTERNAL ENVIRONMENT
(CONTINUED…)
Physical work environment
Employee safety and health have caused many
organizations to pay more attention to their internal
environment.
It is essential to keep a
safe, healthy and
comfortable environment
as it contributes to work
efficiency and the well-
being of workers.
ETHICS IN MANAGEMENT
Ethics
An area of study that deals with ideas
about what is good and bad behavior.
The rules and principles that define right
and wrong conduct.
ETHICS IN MANAGEMENT
(CONTINUED…)
Managerial Ethics
Ethics in the workplaces helps ensure that
when leaders and managers are struggling
in times of crises and confusion, they retain
a strong moral compass.
ETHICS IN MANAGEMENT (CONTINUED…)

Types of Management Ethics

Moral Management- Conforms to high
standards of ethical behavior.
Immoral Management- A style devoid of
ethical principles and active opposition to
what is ethical.
ETHICS IN MANAGEMENT (CONTINUED…)

Amoral Management
Intentional - does not consider ethical factors.
Unintentional - careless about ethical
considerations in business.
CHANGE MANAGEMENT

Any substantive modification to some part of the

organization. The manager needs to understand
how to counter employee resistance to change.

Three Areas of Change:

Organization Structure
Technology and Operation
People
CHANGE MANAGEMENT (CONTINUED…)

Building Trust
It is important for change managers to make
trust a core component of interactions and
culture from the beginning. This makes it
easier to flush out and solve issues before
they become roadblocks.
 THE END
Thank You for Your
Attention!