Introduction to Business

Management

Dr. Aizhan Baimukhamedova

 Learning Objectives and Outcomes
• Describing organization
• Tell who managers are and where they work
• Explain why its important to study management
• Describe the factors that are reshaping and redefining
management
• Describe what management is, why management is important,
what managers do
• Describe how managers utilize organizational resources
efficiently and effectively to achieve organizational goals.
• Distinguish among planning, organizing, leading, and
controlling (the four managerial functions), and explain how
managers’ ability to handle each one can affect organizational
performance.
 Learning Objectives and Outcomes

• Differentiate among three levels of management, and

understand the responsibilities of managers at different levels
in the organizational hierarchy.
• Identify the roles managers perform, the skills they need to
execute those roles effectively and the way new information
technology is affecting these roles and skills.
• Discuss the principal challenges managers face in today’s
increasingly competitive global environment.
• History of management thought and evaluation of
management theories
Organization
 Management Key Concepts
• Organization
– People working together and
coordinating their actions to achieve
specific goals. Management

• Goal/objective
– A desired future condition that the
organization seeks to achieve.
• Strategy
– A cluster of decisions about what
goals to pursue, what actions to
take, and how to use resources to
achieve goals.
 What is an Organization?

Organizations are very complex social formations,

their links can’t be described with only one theory.

Organization Theories concern 3 levels:

 Macro: cooperation among different organization
 Mezzo: structures of the organizations, and influencing
factors
 Micro: behavior of the members of the organizations,
motivation, conflict etc.
 Three Characteristics of Organization?

Common Characteristics of Organizations

• Distinct purpose expressed in a goal or a set of goals
• People working together to achieve the orgs goal through a set of
decisions and work activities.
• A deliberate systematic structure that defines and limits the behavior
of its members Copyright ©2011 Pearson Education 1-8
 Functional Areas of
Business (Organization)
Functional Areas of A Business Organization

• Management
• R&D
• Marketing
• Finance
• Production
• HR
 What is Management?

The planning, organizing, leading, and

controlling of human and other resources to
achieve organizational goals effectively and
efficiently
Functional Areas of A Business Organization

• R&D = Research & Development

– New product design and development
Functional Areas of A Business Organization

• Marketing
– Planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and
services to create exchanges that satisfy individual
and organizational objectives
Functional Areas of A Business Organization

• Finance& Accounting
– Revenue, expenses, budget, financial records and
financial statements
Functional Areas of A Business Organization

• Production
– Extraction and cultivation (products are obtained
from nature or grown using natural resources)
– Processing (changing and improving the form of
another product)
– Manufacturing (combines raw materials and
processed goods into finished products)
Functional Areas of A Business Organization

• HR = Human Resources
– People who work for a business/organization
– Involves in planning & staffing, performance
management, compensation & benefits, and
employee relations
Manager
 Who managers are?

• Someone who coordinates and oversees the

work of other people in order to accomplish
organizational goals.
 Who managers are?
• Managers –The people responsible for
supervising the use of an organization’s
resources to meet its goals.
• Resources include people, skills, knowledge,
machinery, computers and IT, and financial
capital
 Organizational Performance

• A measure of how efficiently and effectively

managers are using organizational resources
to satisfy customers and achieve goals
 How Are Managers Different from
Nonmanagerial Employees?
• Nonmanagerial Employees
– People who work directly on a job or task and have
no responsibility for overseeing the work of others.
– Examples, associates, team members
• Managers
– Individuals in organizations who direct and
oversee the activities of others.
– Managers do work directly on tasks such as
servicing some costumers.

Copyright ©2011 Pearson Education 1-21

 Traits of a manager
Best Traits
Fair/just in decisions
Trusting/trusted at the same time
Caring & analytical in thought
Empowering & capable/responsible
Always punctual

Worst Traits
Deceitful
Dishonest
Shows favouritism
Lazy
Unorganized
Katz’s Essential Managerial Skills
 Skills of a manager ……..

• Human Resource Skills

• Technical Skills

• Conceptual Skills
 Skills of a manager ……..

• Technical Skills: job-specific knowledge and techniques

needed to proficiently perform work tasks

• Human Skills: ability to work well with other people

both individually and in group

• Conceptual Skills: ability to see the organization as a

whole, understand the relationships among various
subunits, visualize how the organization fits into its
external environment
 Skills of a manager ……..
Conceptual Human resource

Board of directors

CEO

Functional Top Execs

Middle Level Execs

Technical
First Line Supervisors
 Skills Needed at Different Managerial
Levels

Top Managers Conceptual

Skills

Human Skills
Middle Managers

Technical
Low-Level Managers Skills

*Dark color = necessary to have

Copyright ©2011 Pearson Education 1-29
 What Titles Do Managers Have?
• Top Managers
– Responsible for making decisions about the direction of the organization
and establishing policies and philosophies that effect all organizational
members .
– Examples; President, Chief Executive Officer, Vice-President
• Middle Managers ( btw the lowest and top levels)
– Manage the activities of other managers and non managerial employees
and translating the goals set by top managers to specific details that lower
managers can understand.
– Examples; District Manager, Division Manager
• First-line Managers
– Responsible for directing the day to day activities of nonmanagerial
employees
– Examples; Supervisor, Team Leader
Copyright ©2011 Pearson Education 1-30
 Mintzberg’s Managerial Roles

• Interpersonal Roles: involve people (subordinates

and person outside the organization) and other
duties that are ceremonial and symbolic in nature

• Informational Roles: involve collecting, receiving,

and disseminating information

• Decisional Roles: entail making decisions or

choices
Mintzberg groups managerial activities
and roles as involving:
 1. Interpersonal Roles
• Figurehead: perform ceremonial duties like
greeting company visitors, speaking at the
opening of a new facility, or representing the
company at a community luncheon to support
local charities
 1. Interpersonal Roles (Cont)
• Leader: motivate and encourage workers to
accomplish organizational objectives

• Liaison: deal with people outside their units to

develop alliances that will help in org. goal
achievement
 2. Informational Roles
• Monitor: scan environment for information,
actively contact others for information,
continually update news/ stories related to
their business (inside and outside org.)

• Disseminator: share the information they

have collected with their subordinates and
others in the company
 2. Informational Roles (Cont)
• Spokeperson: share information with people
outside their departments and companies
 3. Decisional Roles
• Entrepreneur: adapt themselves, their
subordinates, and their units to change/
innovation

• Disturbance Handler: respond to pressures

and problems demand immediate attention
and action
 3. Decisional Roles (Cont)
• Resource Allocator: set priorities and decide
about use of resources

• Negotiator: continual negotiate schedules,

projects, goals, outcomes, resources, and
employee raises in order to accomplish the
goals
 Is The Manager’s Job Universal?
• Profit vs. Nonprofit
• Manager’s job are the same in both profit and non
profit org. All of them make decisions, set goals, and
motivate their employees.
• The only difference is in the (performance measurement):
• Profit organizations measure their performance by
the amount of profit they achieve.
• There are no specific measurement to measure the
success of non-profit org.
• The financial side is still important in non- profit org.
1-39
Is the Manager’s Job Universal? (cont’d)
• Size of the Organization
– Small businesses have fewer than 500 employees and
which doesn’t often engage in any new innovative
practices … managers in this kind of org do the role of
spokesperson and spend most of their time in doing
outwardly directed action ex. meeting with costumers.
– Large business is the contrast of the above.
• National Borders (Geographic location)
– It is not a good idea to make the manager and
management concept universal because each country is
greatly different in its economic, political, social, and
cultural environment.
Copyright ©2011 Pearson Education 1-40
Managerial Roles in Small and Large Business

Copyright ©2011 Pearson Education 1-41

Management
 What is Management?
• Management involves coordinating and overseeing the
work activities of others so that their activities are
completed efficiently and effectively.

• A process refers to a set of ongoing and interrelated

activities.

• Or Management is the art of getting work done through

others
 What is Management?

IS management an art or science ?

• ART
Because it depends on the skills, aptitude & creativity of the
manager

• SCIENCE
Because there is considerable knowledge in the field of
management with basic principles for guidance of basic
activities.
 The Importance of Management

New Product Development

•Boeing Airline’s 787 Dreamliner

•892 sold @ $169 million each
•$145 billion total sales
•57 global customers
 What is Management?

• Is the process of using what you have

{ RESOURCES }, to do what you want to
do …. {GOALS}
 What is Management?

Resources (Assets)/ 7 categories of resources:

 People
 Money
 Time
 Work Procedures
 Energy
 Materials
 Equipment
 What is Management?

Goals
• Profit Levels or Maximum cost levels
• Maintenance or growth of financial strength
• Quality standards
• Guest employee & management concerns
• Professional obligations
• Societal concerns
 Managerial Functions
• Managers at all levels in all organizations
perform each of the functions of planning,
organizing, leading, and controlling.
• Henri Fayol outlined the four managerial
functions in his book General Industrial
Management
 Planning
• Planning involves tasks involves tasks that
must be performed to that must be performed
to attain organizational goals, attain
organizational goals, outlining how the tasks
outlining how the tasks must be performed,
and must be performed, and indicating when
they indicating when they should be
performed.
 Planning
• Determining organizational goals and means to
reach them
• Managers plan for three reasons
1.Establish an overall direction for the
organization’s future
2.Identify and commit resources to achieving
goals
3.Decide which tasks must be done to reach
those goals
 Organizing
Organizing means assigning the planned tasks to
various individuals or groups within the
organization and cresting a individuals or groups
within the organization and cresting a
mechanism to put plans into action.
 Organizing
• Process of deciding where decisions will be
made, who will perform what jobs and tasks,
and who will report to whom in the company.
• Includes creating departments and job
descriptions.
 Leading
• Leading (Influencing) means guiding the
activities of the organization members in
appropriate directions.
• Objective is to improve productivity.
 Leading
• Getting others to perform the necessary tasks
by motivating them to achieve the
organization’s goals
• Crucial element in all functions
 Controlling
1. Gather information that measures recent
performance
2. Compare present performance to pre-
established standards
3. Determine modifications to meet pre-
established standards
 Controlling
• Process by which a person, group, or
organization consciously monitors
performance and takes corrective action
 Organizational Structure
• A formal system of task and reporting
relationships that coordinates and motivates
organizational members
 What is Management?
 Organization determines network or establishes structure or
relationships among individuals.

 Administration refers to management functions of planning

& control

 Management
Administrative Management
Operative Management
 What is Management?

• Administration: Concerned with laying down of

corporate policy, obtaining finance, production &
distribution.

• Management: Concerned with actual execution of

policies within limits set by administration.

• Organization: Combines the work in such a way

with individuals/groups that duties formed provide
best possible application of available effort
 Administrative

• Board of directors

CEO
•
• Functional Top Execs

•
• Middle Level Execs

• First_Line Suupervisors
Management First Line Supervisors
 Types of Top Management
The 5 Highest Paid CEO’s in 2007

•President
•Chief Executive Officer (CEO)
•Chief Financial officer (CFO)
•Chief Operations officer (COO)
 How Many level of
Managers Can We Classify?
 How to classify managers in organizations?
Traditional Pyramid Form of Management Level

Top
Managers

Middle Managers

First-Line Managers

Non-Managerial
Employees
Functional R&D Marketing Finance Production HR
Areas
 I. Lowest Level of Management
• First-line managers: manage the work of nonmanagerial
employees who typically are involved with producing the
organization’s products or servicing the organization’s
customer
• They are often called: supervisor, shift manager, district
manager, department manager, office manager

• Supervise workers
• Oversee daily operations
• Directing and controlling primary functions
 II. Middle Level of Management
• Middle managers: manage work of first-line
managers

• They are often called: regional manager,

project leader, store manager, division
manager
• Responsible for tactical planning
• Implement general guidelines established by
top management
 III. Upper Level of Management
• Top managers: are responsible for making
organization wide decisions and establishing
the plans and goals that affect the entire
organization.

• They are often called: executive vice

president, president, managing director, chief
operating officer, chief executive officer