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One
Managing and the Managers Job
What is an organization?
A group of people working together in a structured and coordinated fashion to achieve a set of goals.
Organizational Resources
Human resources Financial resources
Capital investments to support ongoing and long-term operations
Physical Assets
Information
Usable data, information linkages
What is Management?
A set of activities
planning and decision making, organizing, leading, and controlling
with the aim of achieving organizational goals in an efficient and effective manner.
EFFICIENTLY
Using resources wisely and in a cost-effective way
And
EFFECTIVELY
Making the right decisions and successfully implementing them
What is a Manager?
Someone whose primary responsibility is to carry out the management process. Someone who plans and makes decisions, organizes, leads, and controls human, financial, physical, and information resources.
Organizing Leading
The set of processes used to get members of the organization to work together to advance the interests of the organization.
Controlling
First-Line Managers
Managers who supervise and coordinate the activities of operating employees.
Informational Roles
Monitor, disseminator, and spokesperson roles involve the processing of information.
Decisional Roles
Entrepreneur, disturbance handler, resource allocator, and negotiator are managerial roles primarily related to making decisions.
Role
Figurehead Leader Liaison Monitor Disseminator Spokesperson
Sample Activities
Attending ribbon-cutting ceremony for new plant Encouraging employees to improve productivity Coordinating activities of two projects Scanning industry reports to stay abreast of developments Sending memos outlining new organizational initiatives Making a speech to discuss growth plans Developing new ideas for innovation Resolving conflict between two subordinates Reviewing and revising budget requests Reaching agreement with a key supplier or labor union
Informational
Decisional
Managerial Skills
Technical
Skills necessary to accomplish or understand the specific kind of work being done in an organization.
Interpersonal
Conceptual
The managers ability to think in the abstract.
Diagnostic
Decision-Making
Time-Management
The managers ability to prioritize work, to work efficiently, and to delegate appropriately.
Art of Management
Decisions are made and problems solved using a blend of intuition, experience, instinct, and personal insights.
Managing in Organizations
For-profit Organizations
Large businesses Small businesses and start-up businesses International management
Not-for-profit Organizations
Governmental organizationslocal, state, and federal Educational organizationspublic and private schools, colleges, and universities Healthcare facilitiespublic hospitals and HMOs Nontraditional settingscommunity, social, spiritual groups
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Two
Traditional and Contemporary Issues and Challenges
Why History?
An awareness and understanding of important historical developments in management are also important to contemporary managers in furthering the development of management practices and in avoiding the mistakes of others in the past.
Scientific Management
Frederick Taylor (18561915)
Considered the Father of Scientific Management. Replaced old rule-of-thumb methods of how to do work with scientifically-based work methods to eliminate soldiering where employees deliberately worked at a pace slower than their capabilities. Used time studies of jobs, standards planning, exception rule of management, slide-rules, instruction cards, and piecework pay systems to control and motivate employees.
1 Develop a science for each element of the job to replace old rule-of-thumb methods
2 Scientifically select employees and then train them to do the job as described in step 1
3 Supervise employees to make sure they follow the prescribed methods for performing their jobs
4 Continue to plan the work, but use workers to get the work done
Henri Fayol
Was first to identify the specific management functions of planning, organizing, leading, and controlling.
Max Weber
His theory of bureaucracy is based on a rational set of guidelines for structuring organizations.
Chester Barnard
Proposed a theory of the acceptance of authority (by subordinates) as the source of power and influence for managers.
Limitations
More appropriate approach for use in traditional, stable, simple organizations. Prescribed universal procedures that are not appropriate in some settings.
Abraham Maslow
Advanced a theory that employees are motivated by a hierarchy of needs that they seek to satisfy.
Douglas McGregor
Proposed Theory X and Theory Y concepts of managerial beliefs about people and work.
Organizational Behavior
A contemporary field focusing on behavioral perspectives on management. Important topics in organizational behavior research:
Job satisfaction and job stress Motivation and leadership Group dynamics and organizational politics Interpersonal conflict The design of organizations
Limitations
Complexity of individuals makes behavior difficult to predict. Many concepts not put to use because managers are reluctant to adopt them. Contemporary research findings are not often communicated to practicing managers in an understandable form.
Management Science
Focuses on the development of representative mathematical models to assist with decisions.
Operations Management
Practical application of management science to efficiently manage the production and distribution of products and services.
Limitations
Quantitative management cannot fully explain or predict the behavior of people in organizations. Mathematical sophistication may come at the expense of other managerial skills. Quantitative models may require unrealistic or unfounded assumptions, limiting their general applicability.
Open system
An organization that interacts with its external environment.
Closed system
An organization that does not interact with its environment.
Subsystems
The importance of subsystems is due to their interdependence on each other within the organization.
Systems Perspective
Synergy
Subsystems are more successful working together in a cooperative and coordinated fashion than working alone.
Entropy
A normal process in which an organizational system declines due to failing to adjust to change in its environment Entropy can be avoided and the organization re-energized through organizational change and renewal.
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Three
The Environment and Culture of Organizations
Internal Environment
Conditions and forces present and at work within an organization
Organizational Culture
Managing Organizational Culture
Understand the current culture to understand whether to maintain or change it. Reward and promote people whose behaviors are consistent with desired cultural values.
Environmental Turbulence
Unexpected changes and upheavals in the environment of an organization.
Strategic Response
Maintaining the status quo, altering the current strategy, or adopting a new strategy.
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Four
The Ethical and Social Environment
Ethical Behavior
This behavior is in the eye of the beholder. However, it also refers to behavior that conforms to generally accepted social norms.
Ethics in Organizations
Managing Ethical Behavior
Must begin with top management which establishes the organizations culture and defines what will and will not be acceptable behavior. Training how to handle different ethical dilemmas. Develop a written code of ethics Individual issues
Defensive Stance
Accommodative Stance
Meet legal and ethical obligations and go beyond that in selected cases.
Proactive Stance
Ethical Compliance
Philanthropic Giving
Whistle Blowing
The organizational response to the disclosure by an employee of illegal or unethical conduct on the part of others within the organization is indicative of the organizations stance on social responsibility.
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Five
The Global Environment
Global Business
Importing
Bringing a good, service, or capital into a home country from abroad. Advantages and disadvantages
Market Systems
Clusters of countries that engage in high levels of trade with each other through the elimination of trade barriers such as quotas and tariffs.
Other Economies
Some economies defy classification due to their possession of critical and valuable resources (e.g., oil-producing countries) or other social or political factors which distort their internal economies and markets. Challenges of other economies Ethnic violence
Controlling
Involves integrating global operations that encompass timezone differences, cultural factors, and varying communication methods.
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Six
The Multicultural Environment
Multiculturalism
The broad issues associated with differences in values, beliefs, behaviors, customs, and attitudes held by people in different cultures.
Diversity
When members of a group differ from one another along dimensions such as age, gender, or ethnicity.
Gender
Females were 46% of the workforce in 1994.
Ethnicity
The ethnic composition of the U.S. workforce will change most with the increasing number of Hispanic workers and the decline in white workers.
Multicultural Differences
The increasing globalization of business and immigration patterns will affect workforce diversity and present challenges to managers to successfully manage diversity.
Problem-Solving Argument
Organizational Culture
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Seven
Basic Elements of Planning and Decision Making
Strategic goals
Strategic plans
Tactical goals
Tactical plans
Operational goals
Operational plans
Organizational Goals
Purposes of Goals
Provide guidance and a unified direction for people in the organization. Have a strong affect on the quality of other aspects of planning. Serve as a source of motivation for employees of the organization.
Kinds of Goals
By Level
Mission statement is a statement of an organizations fundamental purpose. Strategic goals Tactical goals are set by and for middle managers; their focus is on how to operationalize actions to strategic goals. Operational goals
By Area
Goals set for the different functional areas of the organization.
By Time Frame
Goals may be set for long-term, intermediate-term, or shortterm time frames and for explicit time frames or open-ended.
Tactical Plans
Operational Plans
Long-range Plans
Intermediate Plans
usually cover from 1 to 5 years and parallel tactical plans. are the principal focus of organizational planning efforts.
Short-range Plans
Board of Directors
Establishes corporate mission and strategy.
Line Management
Persons with formal authority and responsibility for management of the organization. Help to formulate strategy by providing information.
Poor implementation of the goal setting process Lack of top-management support for goal setting Delegation of the goal-setting process to lower levels Overemphasis on quantitative goals Too much paperwork and record keeping
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Eight
Managing Strategy and Strategic Planning
Strategic Management
A comprehensive and ongoing management process aimed at formulating and implementing effective strategies which align the organization with its environment to achieve major organizational goals.
Effective Strategies
Strategies that promote a superior alignment between the organization and its environment and the achievement of its goals.
Components of Strategy
Distinctive Competence
Something an organization does exceptionally well.
Scope
Range of markets in which an organization will compete.
Resource Deployment
How an organization will distribute its resources across the areas in which it competes.
Corporate-level Strategy
The set of strategic alternatives that an organization chooses from as it manages its operations simultaneously across several industries and several markets.
Strategy Implementation
The methods by which strategies are operationalized or executed within the organization
Deliberate Strategy
A plan, chosen and implemented to support specific goals, that is the result of a rational, systematic, and planned process of strategy formulation and implementation.
Emergent Strategy
A pattern of action that develops over time, in the absence of goals or missions, or despite goals and missions.
Focus strategy An organization concentrates on a specific regional market, product line, or group of buyers.
Defender
Analyzer
Reactor
Diversification
The number of businesses an organization is engaged in and the extent to which these businesses are related to one another
Related Diversification
Related Diversification
A strategy in which an organization operates in several different businesses, industries, or markets that are somehow linked.
Advantages
Stable corporate-level performance over time due to business cycle differences among the multiple businesses.
Disadvantages
Firms with unrelated strategies fail to exploit important synergies, putting them at a competitive disadvantage to firms with related diversification strategies.
Managing Diversification
Major Tools for Managing Diversification
Organization structure Detailed discussion of organization structure is contained in Chapter 12. Portfolio management techniques Methods that diversified organizations use to make decisions about what businesses to engage in and how to manage these multiple businesses to maximize corporate performance. Two important portfolio management techniques are the BCG Matrix and the GE Business Screen.
Managing Diversification
GE Business Screen
A method of evaluating business in a diversified portfolio along two dimensions, each of which contains multiple factors In general, the more attractive the industry and the more competitive a business is, the more resources an organization should invest in that business.
Multidomestic strategy
Used by firms that manage a portfolio of international business as relatively autonomous and independent units.
Global strategy
Companies doing exactly the opposite of those using a multidomestic strategy (they are standardizing across all countries).
Transnational strategy
Pursue both centralization and decentralization at the same time, using whichever approach makes more sense in the particular circumstance.
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Nine
Managing Decision Making and Problem Solving
Decision-Making Process
The process of recognizing and defining the nature of a decision situation, identifying alternatives, choosing the best alternative, and putting it into practice. An effective decision is one that optimizes some set of factors such as profits, sales, employee welfare, and market share. Managers make decisions about both problems and opportunities.
Types of Decisions
Programmed Decisions
A decision that is a fairly structured decision or recurs with some frequency or both.
Nonprogrammed decisions
A decision that is relatively unstructured and occurs much less often a programmed decision.
Decision-Making Conditions
Decision Making Under Certainty
A condition in which the decision maker knows with reasonable certainty what the alternatives are and what conditions are associated with each alternative.
3. Evaluating alternatives
At some time in the future, the manager should ascertain the extent to which the alternative chosen in step 4 and implemented in step 5 has worked.
Satisficing
The tendency to search for alternatives only until one is found that meets some minimum standard of sufficiency to resolve the problem.
Coalition
Escalation of Commitment
A decision maker is staying with a decision even when it appears to be wrong.
Risk Propensity
The extent to which a decision maker is willing to gamble when making a decision.
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Eleven
Basic Elements of Organizing
Organization Structure
The set of building blocks that can be used to configure an organization.
Designing Jobs
Job Design
The determination of an individuals work-related responsibilities.
With specialization:
20 workers make 100,000 pins a day. 1 worker = 5,000 pins 20 pins vs. 5,000 pins per worker
Alternatives to Specialization
Job Rotation
Systematically moving employees from one job to another in an attempt to reduce employee boredom. Most frequent use today is as a training device for skills and flexibility.
Job Enlargement
An increase in the total number of tasks workers perform.
Job Enrichment
Increasing both the number of tasks the worker does and the control the worker has over the job.
Work Teams
An alternative to job specialization that allows the entire group to design the work system it will use to perform an interrelated set of tasks.
Advantages
Each department can be staffed by functional-area experts. Supervision is facilitated in that managers only need be familiar with a narrow set of skills.
Disadvantages
Decision making becomes slow and bureaucratic. Employees narrow their focus to the department and lose sight of organizational goals/ issues.
Advantages
All activities associated with one product can be integrated and coordinated. Speed and effectiveness of decision making are enhanced.
Disadvantages
Managers may focus on their product to the exclusion of the rest of the organization. Administrative costs may increase due to each department having its own functional-area experts.
Customer Departmentalization
Customer Departmentalization
Grouping activities to respond to and interact with specific customers and customer groups.
Advantage Disadvantage
A large administrative staff is needed to integrate activities of various departments.
Location Departmentalization
Location Departmentalization
The grouping of jobs on the basis of defined geographic sites or areas.
Advantage
Enables the organization to respond easily to unique customer and environmental characteristics.
Disadvantage
Large administrative staff may be needed to keep track of units in scattered locations.
Departmentalization
Other Forms of Departmentalization
Grouping activities by time Assigning responsibilities by a characteristic of the customer, product, or service (e.g., telemarketing calls from business listings).
Other Considerations
Departments are often called by other names (e.g., divisions, units, sections, and bureaus). Organizations are likely to employ multiple bases of departmentalization, depending on level.
Flat Organizations
Lead to higher levels of employee morale and productivity. Create more administrative responsibility for the relatively few managers.
the competence, the wider the potential span). 2. Physical dispersion of subordinates (the greater the dispersion, the narrower the potential span). 3. Extent of nonsupervisory work in a managers job (the more nonsupervisory work, the narrower the potential span). 4. Degree of required interaction (the less required interaction, the wider the potential span). 5. Extent of standardized procedures (the more procedures, the wider the potential span). 6. Similarity of tasks being supervised (the more similar the tasks, the wider the potential span). 7. Frequency of new problems (the higher the frequency, the narrower the potential span). 8. Preferences of supervisors and subordinates.
Distributing Authority
Authority
Delegation
The process by which managers assign a portion of their total workload to others.
Problems in Delegation
Manager
Reluctant to delegate. Subordinates success threatens superiors advancement. Lack of trust in the subordinate to do well.
Subordinate
Reluctant to accept delegation for fear of failure. Perceives no rewards for accepting additional responsibility.
Centralization
Coordinating Activities
Coordination
Coordinating Activities:
Sequential interdependence
When the output of one unit becomes the input of another unit in sequential fashion.
Reciprocal interdependence
Integrating Departments
Permanent organizational units that maintain internal integration and coordination on an ongoing basis.
Staff Positions
Positions intended to provide expertise, advice, and support to line positions. Have functional authority to enforce compliance with organizational policies and procedures.
Administrative Intensity
The degree to which managerial positions are concentrated in staff positions.
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Thirteen
Managing Organization Change and Innovation
Reengineering in Organizations
Reengineering
The radical redesign of all aspects of a business to achieve major gains in cost, service, or time.
Approaches to Reengineering
Recognizing the need for change and acting on it with a sense of urgency. Starting with a clean slate helps open up the process.
OD Assumptions
Individuals will influence the organization and the organization will influence the attitudes, perceptions, behaviors, and expectations of individuals.
Organizational Innovation
Innovation
Development
Organization evaluates, modifies, and improves on a creative idea.
Application
Organization uses developed idea in design, manufacturing, or delivery of new products, services, or processes.
Launch
Organization introduces new products or services to the marketplace.
Decline
Demand for an innovation decreases, and substitute innovations are developed and applied.
Maturity
Most competing organizations have access to the idea.
Growth
Demand for new products or services grows.
Incremental Innovation
A new product, service, or technology that modifies an existing one. Incremental innovation does not significantly affect competition in an industry.
Innovation
Reasons for Failing to Innovate
Lack of resources Failure to recognize opportunities Resistance to change
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Fourteen
Managing Human Resources in Organizations
Dual-Career Families
Firms are increasingly having to make accommodations for dual-career partners
Internal Recruiting
Considering present employees as candidates for openings.
External Recruiting
Attracting persons from outside the organization. Realistic Job Preview (RJP) is considered a successful method to ensure person-job fit.
Application Blanks
Used to gather information about work history, educational background, and other job-related demographic data. Must not ask for information unrelated to the job.
Interviews
Interviews can be poor predictors of job success due to interviewer biases.
Other Techniques
Polygraphs have declined in popularity due to passage of the Polygraph Protection Act. Employers now use physical exams, drug tests, and credit checks to screen prospective employees.
Grievance Procedure
The step-wise means by which a labor contract is enforced. Grievances are filed on behalf of an employee by the union when it believes employees have not been treated fairly under the contract.
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Fifteen
Basic Elements of Individual Behavior in Organizations
Self-Efficacy
A persons belief about his or her capabilities to perform a task. High self-efficacy individuals believe they can perform well while low self-efficacy individuals doubt their ability to perform.
Machiavellianism Self-Esteem
The extent to which a person believes she/he is a worthwhile individual.
Risk Propensity
Emotional Intelligence
Five dimensions of EQ: Self-awareness Managing emotions
a persons capacity to ensure that feelings do not interfere with getting things accomplished
Social skill
Cognitive Dissonance
The conflict individuals experience among their own attitudes.
Work-Related Attitudes
Job Satisfaction or Dissatisfaction
An attitude that reflects the extent to which an individual is gratified or fulfilled by his or her work.
Selective Perception
The process of screening out information that we are uncomfortable with or that contradicts our beliefs.
Stereotyping
The process of categorizing or labeling people on the basis of a single attribute (e.g., gender and race).
Task Demands
Quick decisions Critical decisions Incomplete information for decisions
Physical Demands
Temperature extremes Poorly designed office Threats to health
Role Demands
Role ambiguity Role conflict
Interpersonal Demands
Group pressures Leadership styles Conflicting personalities
Managing Stress
Stress Management Strategies for Individuals
Regular exercise reduces tension and stress, and improves self-confidence and feelings of optimism. Relaxation
Time management reduces stress by prioritizing activities to accomplish them in their order of importance. Support Groups
Creativity in Organizations
Creativity
The ability of an individual to generate new ideas or to conceive of new perspectives in existing ideas.
Incubation
A period of less intense conscious concentration during which knowledge and ideas acquired, during preparation, mature and develop.
Verification
Determines the validity or truthfulness of the insight. Tests are conducted and prototypes are built to see if the insight leads to the expected results.
Performance Behaviors
The total set of work-related behaviors an organization expects an individual to display.
Withdrawal Behaviors
Absenteeism occurs when an individual does not show up for work when expected for legitimate or feigned reasons. Turnover occurs when individuals quit their jobs for workrelated or personal reasons.
Organizational Citizenship
The behavior of individuals that makes a positive overall contribution to the organization. The determinants of organizational citizenship is a complex mosaic of individual, social, and organizational variables. The personality, attitudes, and needs of the individual. The social context, or work group, in which the individual works.
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Sixteen
Managing Employee Motivation and Performance
outcomes (other)
inputs (other)
Characteristics of Goals
Goal difficulty Extent to which a goal is challenging and requires effort. Goal specificity Clarity and precision of the goal. Acceptance The extent to which persons accept a goal as their own. Commitment The extent to which an individual is personally interested in reaching a goal.
Incentive system
A reward system whereby people get different pay amounts at each pay period in proportion to what they do. Popular incentive systems: Piece-rate incentive plan Individual incentive plan reward individual performance at the time when high performance occurs. Sales commissions paid a percentage of sales over a period of time. Other types:
Paying incentives based on both individual and group performance.
Executive Compensation
Generally includes base salary, annual bonuses based on performance, stock option plans, and other types of compensation
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Seventeen
Managing Leadership and Influence Processes
Leadership Behaviors
Michigan Studies (Rensis Likert)
Identified two forms of leader behavior Job-centered behaviormanagers who pay close attention to subordinates work, explain work procedures, and are keenly interested in performance. Employee-centered behavior These two forms of leader behaviors were considered to be at opposite ends of the same continuum and similar to (respectively) Likerts System 1 and System 4 of organizational design.
Leadership Style
Supportive
Impact on Followers
Increases selfconfidence to complete task Encourages setting high but attainable goals Clarifies follower need for making suggestions and involvement Clarifies path to get rewards
Expected Results
Increased effort. job satisfaction, and performance; fewer grievances Improved performance and greater job satisfaction Improved performance and greater satisfaction; less turnover
Achievementoriented
Subordinate 1
Subordinate 2 Out-Group
Subordinate 3
Subordinate 4
Subordinate 5
In-Group
Task
Routineness The availability of feedback Intrinsic satisfaction
Organization
Formalization Group cohesion Inflexibility A rigid reward structure
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Nineteen
Managing Work Groups and Teams
Functional Group
A permanent group created to accomplish a number of organizational purposes with an indefinite time horizon.
Quality circle
Role Structures
The set of defined roles and interrelationships among those roles that the group or team members define and accept. Are the result of role episodes in which the expected role is translated and defined into the enacted role. Role ambiguity
Expected role
Sent role
Perceived role
Enacted role
Low performance
Lowest performance
Low Low
Cohesiveness
High
Intergroup Conflict
Interdependence Different goals Competition for scarce resources
Controlling conflict
Expand resource base Enhance coordination of interdependence Set supraordinate goals Match personalities and work habits of employee
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Twenty
Basic Elements of Control
Minimize costs
Responsibilities for Control Controllera position in organizations that helps line managers with their control activities.
Financial Control
Financial Control
Control of financial resources (i.e., revenues, shareholder investment) as they flow into the organization, are held by the organization (i.e., working capital, retained earnings), and flow out of the organization (i.e., payment of expenses). Budgetary Control Budgets may be established at any organizational level. Budgets are typically for one year or less. Budgets may be expressed in financial terms, units of output, or other quantifiable factors. Budgets serve four purposes
Weaknesses
Budgets can hamper operations if applied too rigidly. Budgets can be time consuming to develop. Budgets can limit innovation and change.
Financial Audits
Auditan independent appraisal of an organizations accounting, financial, and operational systems. External auditsfinancial appraisals conducted by experts who are not employees of the organization to verify to external parties that the organizations financial and accounting procedures are legal and proper. Internal auditsappraisals conducted by employees of the organization to determine the accuracy, efficiency, and appropriateness of financial and accounting procedures.
Structural Control
Bureaucratic Control
A form of organizational control characterized by formal and mechanistic structural arrangements.
Clan Control
An approach to organizational control characterized by informal and organic structural arrangements.
Dimension
Goal of control approach
Clan Control
Employee commitment Group norms, culture, self-control Directed toward enhanced performance above and beyond the minimum Flat structure, shared influence Directed at group performance Extended and informal
Degree of formality
Performance expectations
Organization design
Reward system
Participation
Strategic Control
Integrating Strategy and Control
Strategic control Control aimed at ensuring that the organization is maintaining an effective alignment with its environment and moving toward achieving its strategic plan. Focuses on structure, leadership, technology, human resources, and informational and operational systems. Focuses on the extent to which implemented strategy achieves the organizations goals. International Strategic Control Focuses on whether to manage the global organization from a centralized or decentralized perspective.
Inappropriate Focus
Rewards for Inefficiency
Rewarding operational efficiency can lead employees to behave in ways that are not in the best interests of the organization.
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Twenty-One
Managing Operations, Quality, and Productivity
Service Operations
Service organization
Capacity Decisions
Involve choosing the amount of products, services, or both that can be produced by an organization. High-risk decisions due to uncertainty about future product demand and the significant costs of additional, possibly excess, capacity.
Organizational Technologies
Manufacturing Technology
Technologythe set of processes and systems used by organizations to convert resources into products or services. Automationthe process of designing work so that it can be completely or almost completely performed by machines. Computer-assisted manufacturing (CAM) Computer-aided design (CAD)the use of computers to design and complete products and to simulate performance so that prototypes need not be constructed. Flexible manufacturing systemsthe use of robotic systems and computers to coordinate and integrate automated production and material handling facilities.
Service Technology
Services are rapidly moving toward automated systems and procedures (e.g., automated teller machines).
Inventory Management
Inventory control (Materials Control) Just-in-time (JIT) method An inventory system than has necessary materials arriving as soon as they are needed (just in time) so that the production process is not interrupted.
Work-in-process Enables overall production to be divided into stages of manageable size Finished goods Provide ready supply of products on customer demand and enable long, efficient production runs Distributes products to customers
In-transit (pipeline)
4. Conformance. The degree to which a products design and operating characteristics meet established standards.
5. Durability. A measure of product life. 6. Serviceability. The speed and ease of repair. 7. Aesthetics. How a product looks, feels, tastes, and smells. 8. Perceived quality. As seen by a customer.
Employee involvement
Materials
Technology
Methods
Quality improvements
Managing Productivity
Productivity
An economic measure of efficiency that summarizes the value of outputs relative to the value of the resources used to produce them.
Levels of Productivity
The unit of analysis used to calculate or define productivity. Aggregate productivity Industry productivitythe total productivity of all the firms in an industry. Company productivity Unit productivity Individual productivitythe productivity attained by a single person.
Productivity Trends
The United States has the highest level of productivity in the world, although the gap is closing as other countries become more productive. Manufacturing productivity growth continues to exceed that of the service sector.