Introduction to Management

Adapted from H i t t / B l a c k / P o r t e r
Management 2e
 Learning Objectives

After this module, you should be able to:

Define the term management
Explain the major challenges with which
managers must deal
Identify and discuss the primary managerial
functions

2
 Learning Objectives

Explain the three general roles involved in

managerial work and the specific roles
within each
Explore and describe the three dimensions
of managerial jobs
Discuss the primary skills required to be an
effective manager

3
 What is Management?

Management is a process
that involves:
Assembling and using
sets of resources
Acting in a goal-directed
manner to accomplish
tasks
Activities carried out in
an organizational setting
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 Managerial Challenges

Managing
Change

Managing Managerial Managing

Entrepreneurially Challenges Resources

Managing
Strategically

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Managerial Challenges: Managing Change

Managing change:
Is the most persistent,
pervasive and powerful
challenge for managers
Requires managers to
gain employee
acceptance
Two causes of change:
Technology
Globalization
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 Managerial Challenges: Managing Resources

Managers must manage

resources, including:
Financial capital
Human resources
Physical resources
Technology
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Managerial Challenges: Managing Strategically

Managers must:
Develop strategies to
achieve the
organizations goals
Implement the
strategies effectively
by managing human
resources
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Managerial Challenges: Managing Entrepreneurially

Managing
entrepreneurially
involves:
Searching for new
opportunities
Identifying new ideas
for new markets
Emphasizing actions to
take advantage of
uncertainty
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 Historical Approaches to Management

Ancient China and art

of warfare
Ancient Egypt and
building of pyramids
Roman Empire and
building of roads and
viaducts
Industrial Revolution
and modern
management
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 Historical Background of Management

Ancient Management
Egypt (pyramids) and China (Great Wall)
Venetians (floating warship assembly lines)
Adam Smith
Published The Wealth of Nations in 1776
Advocated the division of labor (job specialization) to increase
the productivity of workers
Industrial Revolution
Substituted machine power for human labor
Created large organizations in need of management
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 Major Approaches to Management

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 Major Approaches to Management

Classical
Quantitative
Behavioral
Contemporary

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 Scientific Management
Fredrick Winslow Taylor
The father of scientific management
Published Principles of Scientific Management
(1911)
The theory of scientific management
Using scientific methods to define the one best way for a
job to be done:
Putting the right person on the job with the correct tools
and equipment.
Having a standardized method of doing the job.
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Providing an economic
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 Taylors Scientific Management Principles

1. Develop a science for each element of an individuals work, which

will replace the old rule-of-thumb method.
2. Scientifically select and then train, teach, and develop the worker.
3. Heartily cooperate with the workers so as to ensure that all work
is done in accordance with the principles of the science that has
been developed.
4. Divide work and responsibility almost equally between
management and workers. Management takes over all work for
which it is better fitted than the workers.

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 Scientific Management (contd)

Frank and Lillian Gilbreth

Focused on increasing worker productivity through the
reduction of wasted motion
Developed the microchronometer to time worker motions
and optimize work performance
How Do Todays Managers Use Scientific
Management?
Use time and motion studies to increase productivity
Hire the best qualified employees
Design incentive systems based on output
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 General Administrative Theory
Henri Fayol
Believed that the practice of management was
distinct from other organizational functions
Developed principles of management that applied
to all organizational situations
Max Weber
Developed a theory of authority based on an ideal
type of organization (bureaucracy)
Emphasized rationality, predictability, impersonality,
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 Fayols 14 Principles of Management

1. Division of work 7. Remuneration

2. Authority 8. Centralization

3. Discipline 9. Scalar chain

4. Unity of command 10. Order

5. Unity of direction 11. Equity

6. Subordination of 12. Stability of tenure

individual interests of personnel
to the general 13. Initiative
interest
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14. Esprit de corps
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 Webers Bureaucracy

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 Quantitative Approach to Management

Quantitative Approach
Also called operations research or management
science
Evolved from mathematical and statistical
methods developed to solve WWII military
logistics and quality control problems
Focuses on improving managerial decision
making by applying:
Statistics, optimization models, information models,
and
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 What Is Quality Management?
Intense focus on the customer
Concern for continual improvement
Process-focused
Improvement in the quality of everything
Accurate measurement
Empowerment of employees

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 Understanding Organizational Behavior

Organizational Behavior (OB)

The study of the actions of people at work;
people are the most important asset of an
organization
Early OB Advocates
Robert Owen
Hugo Munsterberg
Mary Parker Follett
Chester Barnard
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 Early Advocates of OB

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 The Hawthorne Studies
A series of productivity experiments conducted
at Western Electric from 1924 to 1932.

Experimental findings
Productivity unexpectedly increased under imposed
adverse working conditions.
The effect of incentive plans was less than
expected.

Research conclusion
Social norms, group standards and attitudes more
strongly influence individual output and work behavior
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than
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 Hawthorne Studies
Conducted in late 1920s
General Electric Hawthorne
plant
Showed the importance of the
individual in the workplace
Showed the presence of a
social system in the workplace
Hawthorne Studies: Workplace Lighting

Originally intended to examine effects of

lighting on productivity
Scientific management proposed that physical
conditions affect productivity
Result: Productivity increased regardless of
lighting level
Conclusion: Increased productivity was due to
workers receiving attention
Hawthorne Experiments

Workplace Lighting
Demonstration
 Base-Level Lighting
Normal Productivity

Control Experimental
Group Group
 More Light
Higher Productivity

Control Experimental
Group Group
 More Light
Higher Productivity

How you doing?

Control Experimental
Group Group
 Even More Light
Even Higher Productivity

Control Experimental
Group Group
 Even More Light
Even Higher Productivity

How you doing?

Control Experimental
Group Group
 Less Light
Even Higher Productivity

Control Experimental
Group Group
 Less Light
Even Higher Productivity

How you doing?

Control Experimental
Group Group
 Even Less Light
Even Higher Productivity

Control Experimental
Group Group
 Even Less Light
Even Higher Productivity

How you doing?

Control Experimental
Group Group
 Hawthorne Studies: Piecework Pay

Examined effects of group piecework pay

system on productivity
Workers under piecework system should
produce as much as possible
Scientific management assumes that people are
motivated only by money
Result: Production less than maximum
Conclusion: Social pressure caused workers to
produce at group-norm level
 The Systems Approach
System Defined
A set of interrelated and interdependent parts arranged in
a manner that produces a unified whole.
Basic Types of Systems
Closed systems
Are not influenced by and do not interact with their environment
(all system input and output is internal).
Open systems
Dynamically interact to their environments by taking in inputs and
transforming them into outputs that are distributed into their
environments.
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 The Organization as an Open System

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 Implications of the Systems Approach

Coordination of the organizations parts is

essential for proper functioning of the entire
organization.
Decisions and actions taken in one area of the
organization will have an effect in other areas
of the organization.
Organizations are not self-contained and,
therefore, must adapt to changes in their
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 The Contingency Approach
Contingency Approach Defined
Also sometimes called the situational approach.
There is no one universally applicable set of
management principles (rules) by which to
manage organizations.
Organizations are individually different, face
different situations (contingency variables), and
require different ways of managing.
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 Popular Contingency Variables

Organization size
As size increases, so do the problems of coordination.
Routineness of task technology
Routine technologies require organizational structures,
leadership styles, and control systems that differ from those
required by customized or non-routine technologies.
Environmental uncertainty
What works best in a stable and predictable environment may be
totally inappropriate in a rapidly changing and unpredictable
environment.
Individual differences
Individuals differ in terms of their desire for growth, autonomy,
tolerance of ambiguity, and expectations.

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 Terms to Know
division of labor (or job quantitative approach
specialization) organizational behavior
Industrial Revolution (OB)
scientific management Hawthorne Studies
therbligs system
general administrative closed systems
theory open systems
principles of management contingency approach
bureaucracy

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What Managers Do

Managerial activities
differ by:
The functions managers
serve
The roles in which
managers operate
The dimensions of each
managers job
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 Managerial Functions

Planning
Controlling

Organizing
Managing

Directing
Adapted from Exhibit 1.1
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Planning

Planning involves:
Estimating future
conditions and
circumstances
Making decisions based on
these estimations about
what work is to be done:
By the manager
By all of those for whom
she or he is responsible
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Organizing
Organizing involves paying
attention to:
The structure of
relationships among
positions
The people occupying
those positions
Linking that structure to
the overall strategic
direction of the
organization
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 Directing

Directing is the process of

influencing other people
to attain organizational
objectives:
Motivating others
Interacting effectively in
group and team situations
Communicating in support
of others efforts
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 Controlling
Regulating the work of those for
whom a manager is responsible,
including:
Setting standards of
performance in advance
Monitoring ongoing (real-time)
performance
Assessing a completed
performance
Results of the control process
(evaluation) are fed back to the
planning process

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 Managerial Roles

Interpersonal
Roles Figurehead Leader Liaison

Figurehead: attending ceremonial activities

Leader: influencing or directing others
Liaison: contacting others outside the formal
chain of command

Adapted from Exhibit 1.2

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 Managerial Roles

Informational
Roles Monitor Disseminator Spokesperson

Monitor: seeking information to be aware of crucial

developments
Disseminator: receiving and sending information
Spokesperson: representing the views of the unit for
which he/she is responsible

Adapted from Exhibit 1.2

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 Managerial Roles

Decisional Disturbance- Resource-

Roles Entrepreneur Negotiator
handler allocator

Entrepreneur: exploring new opportunities

Disturbance-handler: acting as a judge or problem solver
in conflicts among employees
Resource-allocator: deciding how resources will be
distributed
Negotiator: making accommodations with other units

Adapted from Exhibit 1.2

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 Managerial Job Dimensions

Activities or duties
Demands
that must be carried
out
Standards or levels of
minimum
performance that
must be met

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 Managerial Job Dimensions

Factors that limit the

Demands
response of the
manager:
Constraints Time
Budgets
Technology
Attitudes of
subordinates 54
 Managerial Job Dimensions
Discretionary behavior
Demands How work is to be done
How much work is to be
done
Constraints Who will do the work
What initiatives will be
undertaken from almost
Choices infinite possibilities

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 Two Managerial Jobs

Job A: Job B:
Project Team Manager Fast Foods Restaurant
Manager
Demands Develop new product with Maintain attractive
strong market appeal appearance of restaurant
Hold formal weekly Keep employee costs as
progress meeting with low as possible
boss Meet standards for speed of
Frequent travel to other service
company sites

Adapted from Exhibit 1.3

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 Two Managerial Jobs

Job A: Job B:
Project Team Manager Fast Foods Restaurant
Manager
Constraints 12 month deadline for Most employees have
product development limited formal education
Project budget limit of $1 Few monetary incentives to
million reward outstanding
No choice in selecting performance
team members Federal and state health
and safety regulations

Adapted from Exhibit 1.3

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 Two Managerial Jobs

Job A: Job B:
Project Team Manager Fast Foods Restaurant
Manager
Choices The organizational Selection of employee to
structure of the project promote to supervisor
team Scheduling of shifts and
Sequencing of project assignments
tasks Local advertising
Budget allocation promotions

Adapted from Exhibit 1.3

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What Skills Do Managers Need?

TECHNICAL SKILLS

Specialized knowledge
(Including when and how to use the skills)

INTERPERSONAL SKILLS

Sensitivity, persuasiveness, empathy

CONCEPTUAL SKILLS

Logical reasoning, judgment,

analytical abilities

Adapted from Exhibit 1.4

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 Importance of Managerial Skills at Different
Organizational Levels

High Interpersonal skills

Importance

Technical skills

Conceptual skills

Low
Entry-Level Mid-Level Top-Level
Managers Managers Managers

Adapted from Exhibit 1.5

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 Who Succeeds? Who Doesnt?
Potential leaders share Those who dont quite
traits early on: make it:
Bright, with outstanding Have been successful,
track records but generally only in
one area or type of job.
Have survived stressful Often described as moody
situations or volatile. May be able to
keep their temper with
superiors during crises
but are hostile toward
peers and subordinates.
Those who succeed:
Have diverse track
records, demonstrated
ability in many different
situations, and a breadth
of knowledge of the
business or industry.
Maintain composure in
stressful situations, are
predictable during
crises, are regarded as
calm and confident.
Adapted from Exhibit 1.6
61
 Who Succeeds? Who Doesnt?
Potential leaders share Those who dont quite Those who succeed:
traits early on: make it:

Have a few flaws Cover up problems while Make a few mistakes, but
trying to fix them. If the when they do, they admit
problem cant be hidden, to them and handle them
they tend to go on the with poise and grace.
defensive and even
blame someone else for
it.

Ambitious and oriented Micromanage a position, Keep their minds

toward problem solving may staff with the focused on the next
incorrect people or position, develop
neglect the talents they competent successors,
have, depend on a single seek advice from many
mentor. sources.

Adapted from Exhibit 1.6

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 Who Succeeds? Who Doesnt?
Potential leaders share Those who dont quite Those who succeed:
traits early on: make it:

Good people skills May be viewed as Can get along well with
charming but political or different types of people,
direct but tactless, cold, are outspoken without
and arrogant. People being offensive, are
dont like to work with viewed as direct and
them diplomatic.

Adapted from Exhibit 1.6

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