PART I: INTRODUCTION

CHAPTER 1 - MANAGERS AND MANAGEMENT

LEARNING OUTCOMES
After reading this chapter students will be able to:
1. Tell who managers are and where they work.
2. Define management.
3. Describe what managers do.
4. Explain why it’s important to study management.
5. Describe the factors that are reshaping and redefining management.

I. WHO ARE MANAGERS, AND WHERE DO THEY WORK?

A. Introduction
1. Managers work in an organization.
2. An organization is a deliberate arrangement of people brought together to accomplish some
specific purpose.
a) Your college or university is an organization.
B. What Three Common Characteristics Do All Organizations Share?
1. Every organization has a purpose and is made up of people who are grouped in some fashion.
a) See Exhibit 1-1.
b) This distinct purpose is typically expressed in terms of a goal or set of goals.
2. Second, purposes or goals can only be achieved through people.
3. Third, all organizations develop a systematic structure that defines and limits the behavior of
its members.
a) Developing structure may include creating rules and regulations, giving some members
supervisory control, forming teams, etc.
4. The term organization refers to an entity that has a distinct purpose, has people or members,
and has a systematic structure.
C. How Are Managers Different from Operative Employees?
1. Organizational members fit into two categories: operatives and managers.
a) Non-managerial employees work directly on a job or task and have no oversight
responsibility of others.
b) Managers direct the activities of other people in the organization.
1) Customarily classified as top, middle, or first line, they supervise both non-
managerial employees and lower-level managers.
2) See Exhibit 1-2.
3) Some managers also have operative responsibilities themselves.

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Part I - Introduction

2. The distinction between non-managers and managers is that managers have employees who
report directly to them.

D. What Titles Do Managers Have in Organizations?

1. Top managers are responsible for making decisions about the direction of the organization
and establishing policies that affect all organizational members.
a) Examples: Bert and John Jacobs, Google’s Larry Page, Kenneth Chenault of American
Express.
b) Top managers have titles including vice president, managing director, chief operating
officer, chancellor, etc.
2. Middle managers represent levels of management between the first-line supervisor and top
management.
a) They manage other managers and possibly some non-managerial employees.
b) They are responsible for translating the goals set by top management into specific details.
3. First-line managers are usually called supervisors, team leaders, coaches, etc.
a) They are responsible for directing the day-to-day activities of non-managerial employees.
Teaching Notes
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II. WHAT IS MANAGEMENT ?
A. How Do We Define Management?
1. Managers, regardless of title, share several common elements.
2. Management—the process of getting things done effectively and efficiently, through and with
other people.
a) The term “process” in the definition represents the primary activities managers perform.
3. Effectiveness and efficiency deal with what we are doing and how we are doing it.
a) Efficiency means doing the task right and refers to the relationship between inputs and
outputs. Management is concerned about minimizing resource costs.
b) Effectiveness means doing the right task, and in an organization that translates into goal
attainment.
c) See Exhibit 1-3.
4. Efficiency and effectiveness are interrelated.
a) It’s easier to be effective if one ignores efficiency.
b) Good management is concerned with both attaining goals (effectiveness) and doing so as
efficiently as possible.
c) Organizations can be efficient and yet not be effective.
d) High efficiency is associated more typically with high effectiveness.

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 Chapter 1 – Managers and Management

5. Poor management is most often due to both inefficiency and ineffectiveness or to

effectiveness achieved through inefficiency.

Teaching Notes
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III. WHAT DO MANAGERS DO?

1. Henri Fayol defined the management process in terms of five management functions.
a) They plan, organize, command, coordinate, and control.
b) In the mid-1950s, two professors used the terms “planning,” “organizing,” “staffing,”
“directing,” and “controlling” as the framework for the most widely sold management
textbook.
A. What Are the Management Processes?
a) See Exhibit 1-4; planning, organizing, leading, and controlling.
b) These processes are interrelated and interdependent.
1. Planning encompasses defining an organization’s goals, establishing an overall strategy for
achieving those goals, and developing a comprehensive hierarchy of plans to integrate and
coordinate activities.
a) Setting goals creates a proper focus.
2. Organizing—determining what tasks are to be done, who is to do them, how the tasks are
grouped, who reports to whom, and where decisions are to be made.
3. Directing and coordinating people is the leading component of management.
a) Leading involves motivating employees, directing the activities of others, selecting the
most effective communication channel, or resolving conflicts among members.
4. Controlling.
b) To ensure that things are going as they should, a manager must monitor the
organization’s performance.
c) Actual performance must be compared with the previously set goals.
d) Any significant deviations must be addressed.
e) The monitoring, comparing, and correcting are the controlling process.
4. The process approach is clear and simple but may not accurately describe what managers do.
a) Fayol’s original applications represented mere observations from his experiences in the
French mining industry.
5. In the late 1960s, Henry Mintzberg provided empirical insights into the manager’s job.
B. What Are Management Roles?
1. Henry Mintzberg undertook a careful study of five chief executives at work.

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Part I - Introduction

a) Mintzberg found that the managers he studied engaged in a large number of varied,
unpatterned, and short-duration activities.
b) There was little time for reflective thinking (due to interruptions).
c) Half of these managers’ activities lasted less than nine minutes.
2. Mintzberg provided a categorization scheme for defining what managers do on the basis of
actual managers on the job—Mintzberg’s managerial roles.
3. Mintzberg concluded that managers perform ten different but highly interrelated roles.
a) These ten roles are shown in Exhibit 1-5.
b) They are grouped under three primary headings:
1) Interpersonal relationships.
2) Informational
3) Decisional

C. Is the Manager’s Job Universal?

1. The importance of the managerial roles varies depending on the manager’s level in the
organization.
a) The differences are of degree and emphasis but not of activity.
b) As managers move up, they do more planning and less direct overseeing of others.
1) See Exhibit 1-6.
c) The amount of time managers give to each activity is not necessarily constant.
d) The content of the managerial activities changes with the manager’s level.
1) Top managers are concerned with designing the overall organization’s structure.
2) Lower-level managers focus on designing the jobs of individuals and work groups.
2. Profit versus Not-for-Profit.
a) The manager’s job is mostly the same in both profit and not-for-profit organizations.
b) All managers make decisions, set objectives, create workable organization structures, hire
and motivate employees, secure legitimacy for their organization’s existence, and
develop internal political support in order to implement programs.
c) The most important difference is measuring performance, profit, or the “bottom line.”
d) There is no such universal measure in not-for-profit organizations.
e) Making a profit for the “owners” of not-for-profit organizations is not the primary focus.
f) There are distinctions, but the two are far more alike than they are different.
3. Size of Organization.
a) Definition of small business and the part it plays in our society.
1) There is no commonly agreed-upon definition.

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 Chapter 1 – Managers and Management

b) Small business—any independently owned and operated profit-seeking enterprise that

has fewer than 500 employees.
c) Statistics on small business.
1) 98 percent of all nonfarm businesses in the United States.
2) Employ over 60 percent of the private work force.
3) Dominate such industries as retailing and construction.
4) Will generate nearly three-fourths of all new jobs in the economy.
5) Where the job growth has been in recent years.
(a) Companies with fewer than 500 employees have created more than 2 million jobs
(b) Small business start-ups witnessed in countries such as China, Japan, Korea,
Taiwan, and Great Britain.
d) Managing a small business is different from that of managing a large one.
1) See Exhibit 1-7.
2) The small business manager’s most important role is that of spokesperson (outwardly
focused).
3) In a large organization, the manager’s most important job is deciding which
organizational units get what available resources and how much of them (inwardly
focused).
4) The entrepreneurial role is least important to managers in large firms.
5) A small business manager is more likely to be a generalist.
6) The large firm’s manager’s job is more structured and formal than the manager in a
small firm.
7) Planning is less carefully orchestrated in the small business.
8) The small business organizational design will be less complex and structured.
9) Control in the small business will rely more on direct observation.
e) We see differences in degree and emphasis, but not in activities.
4. Management concepts and national borders.
a) Studies that have compared managerial practices between countries have not generally
supported the universality of management concepts.
1) In Chapter 2, we will examine some specific differences between countries.
b) Most of the concepts we will be discussing primarily apply to the United States, Canada,
Great Britain, Australia, and other English-speaking democracies.
c) Concepts may need to be modified when working with India, China, Chile, or other
countries whose economic, political, social, or cultural environments differ greatly from
that of the so-called free-market democracies.

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Part I - Introduction

D. What Skills do Managers Need?

a) Conceptual skills - used to analyze and diagnose complex situations.
b) Interpersonal skills - involved with working well with other people both individually and
in groups.
c) Technical skills - job-specific knowledge and techniques needed to perform work tasks.
d) Political skills - to build a power base and establish the right connections.
Teaching Notes
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IV. WHY STUDY MANAGEMENT?
A. Reasons
1. We all have a vested interest in improving the way organizations are managed.
a) We interact with them every day of our lives.
1) Examples of problems that can largely be attributed to poor management.
b) Those that are poorly managed often find themselves with a declining customer base and
reduced revenues.
2. The reality that once you graduate from college and begin your career, you will either
manage or be managed.
a) An understanding of the management process is foundational for building management
skills.
b) You will almost certainly work in an organization, be a manager, or work for a manager.
c) You needn’t aspire to be a manager in order to gain something valuable from a course in
management.
3. Management embodies the work and practices from individuals from a wide variety of
disciplines.
a) Organizations that are well managed develop a loyal following and are prosperous.
B. What Can Students of Management Learn from Other Courses?
1. College courses frequently appear to be independent bodies of knowledge.
2. There is typically a lack of connectedness between core business courses and between
courses in business and the liberal arts.
3. A number of management educators have begun to recognize the need to build bridges by
integrating courses across the college curriculum.
4. We’ve integrated topics around the humanities and social science courses you may have
taken to help you see how courses in disciplines such as economics, psychology, sociology,
political science, philosophy, and speech communications relate to topics in management.

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 Chapter 1 – Managers and Management

5. The big picture is often lost when management concepts are studied in isolation.
6. Anthropology.
a) The study of societies, which helps us learn about human beings and their activities.
b) Anthropologists’ work on cultures and environments has helped managers better
understand differences in fundamental values, attitudes, and behavior between people.
7. Economics.
a) Concerned with the allocation and distribution of scarce resources.
b) Provides an understanding of the changing economy and the role of competition and free
markets in a global context.
8. Philosophy.
a) Philosophy courses inquire into the nature of things, particularly values and ethics.
b) Ethical concerns go directly to the existence of organizations and what constitutes proper
behavior within them.
9. Political Science.
a) It studies the behavior of individuals and groups within a political environment.
b) Specific topics of concern include structuring of conflict, allocating power, and
manipulating power for individual self-interest.
c) Capitalism is just one form of an economic system.
d) The economies based on socialistic concepts are not free markets but government owned.
Organizational decision makers essentially carry out dictates of government policies.
1) Efficiency had little meaning in such economies.
e) Management is affected by a nation’s form of government, whether it allows its citizens
to hold property, by the ability to engage in and enforce contracts, and by the appeal
mechanisms available to redress grievances.
10. Psychology.
a) The science that seeks to measure, explain, and sometimes change the behavior of
humans.
b) Psychologists study and attempt to understand individual behavior, and is leading the
way in providing managers with insights into human diversity.
c) Psychology courses are also relevant to managers in terms of gaining a better
understanding of motivation, leadership, trust, employee selection, performance
appraisals, and training techniques.
11. Sociology.
a) Sociology studies people in relation to their fellow human beings.
b) Sociologists investigate how societal changes such as globalization, cultural diversity,
gender roles, and varying forms of family life affect organizational practices.

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Part I - Introduction

C. A Concluding Remark
We’ve attempted to provide some insight into need-to-integrate courses you have taken in your
college pursuits because what you learn in humanities and social science courses can assist you in
becoming better prepared to manage in today’s dynamic marketplace.

To check your understanding of outcomes 1.1 – 1.5, go to mymanagementlab.com and try the chapter
questions.

UNDERSTANDING THE CHAPTER

1. What is an organization and why are managers important to an organization’s success?

Answer – An organization is a systematic arrangement of people brought together to accomplish
some specific purpose. All organizations share three common characteristics. 1) Every organization
has a purpose and is made up of people who are grouped in some fashion. 2) No purpose or goal can
be achieved by itself, therefore organizations have members. 3) All organizations develop a
systematic structure that defines and limits the behavior of its members. Organization—an entity that
has a distinct purpose, has people or members, and has a systematic structure.
Managers direct the activities of other people in the organization. Customarily classified as top,
middle, or first line, they supervise both operative employees and lower-level managers. First-line
managers are responsible for directing the day-to-day activities of operative employees. Middle
managers manage other managers and possibly some operative employees. They are responsible for
translating the goals set by top management into specific details. Top managers are responsible for
making decisions about the direction of the organization and establishing policies that affect all
organizational members.

2. Is your course instructor a manager? Discuss in terms of planning, organizing, leading, and
controlling. Also discuss using Mintzberg’s managerial roles approach.
Answer - A college instructor is both an individual contributor and a manager. He/she is in a non-
managerial role when he/she produces “the product” of the university. But he/she is also a manager in
that he/she must manage the class and students.
In terms of:
 Planning—the instructor defines class goals, establishes the semester plan for achieving
them, and develops lesson plans to integrate and coordinate these efforts.
 Organizing—not as much, as he/she is primarily responsible for execution but may need to if
he/she uses class participation.
 Leading—should be relatively obvious, motivating students, direct the activities of others,
select the most effective communication channel, or resolve conflicts among members.
 Controlling—ah grading!
For the sake of space, suggestions will be limited to Mintzberg’s three primary categories.
 Interpersonal - the roles of leader and liaison.
 Informational - monitor and disseminator.
 Decisional - disturbance handler and resource allocator

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