business topic 2 (chap 5-8.6)) Flashcards
traditional vs contemporary management
primary role of a manager is to achieve the business’s goals in a changing environment by coordinating LIMITED resources while working with others
* traditional definition, by coordinating business resources.
* contemporary definition, management is a process of working with, and through, other people.
o human resources are the focus of management.
management requires (5) NEED TO BALANCE THE E’s
- working with & through others (interpersonal skills)
- communicate well with employees to achieve high staff commitment - achieving goals of the business
-employees have purpose
-measure performance
(EFFECTIVENESS) - getting most from limited resources
-managers need to coordinate resources efficiently
-benefits > costs
(EFFICIENCY) -
balancing efficiency & effectiveness
- competitive position in challenging bus environment - anticipate & adjust with rapidly changing environment
effectiveness
measures degree goal been achieved
efficiency
compares resources needed to achieve goal (costs)
against what actually achieved (benefits)
effective manager needs to be good at (POLC):
-
Planning
-prepare predetermined course of action for bus
-process setting objectives & deciding methods to achieve em -
Organising
-structing org to translate plans & goals to action -
Leading
-motivating ppl to work towards achievement of org’s objectives -
Controlling
-evaluating performance & taking corrective action to ensure set objectives achieved
role of effective management
ensure joint efforts of employees directed towards achieving bus goals
whether goals of business achieved largely depends on
skills & expertise of management team in coordinating bus’ resources
manager skills required to operate effectively FARDPIVS
Interpersonal
Strategic thinking
Vision
Problem Solving
Desicion making
Flexibility
Adaptability to change
Reconciling conflicting interests of stakeholders
interpersonal skills
skills needed to work & communicate with others & understand their needs
-abiliy to build positive relationships with staff
why are interpersonal skills important
through others that managers achieve business objects
-to identify & recognise others perspectives and use them in a logical, understanding manner is effective in achieving objectives
-inspire staff while overcoming conflict, creating workplace of respectand collaboration
5 interpersonal skills most crucial to success of managers/leaders SCSMC
- self-management: the ability to delegate responsibility to staff
- actions affect staff behaviour and modify accordingly
- unlike hierarchical management approach (total responsibility for POLC)
-
communication: the ability to listen to employees and learn from them
-vision, staff expectations, listen to feedback from stakeholders, healthy relations
-long term survival of bus -
supportiveness: the ability to create an atmosphere in which employees know they are supported
-acknowledge efforts * needs , empathy, work wtih staff for common solution during conflict - motivation: the ability to customise interactions with employees to suit each individual’s needs in the hope of finding ways to influence their behaviour
-
conflict resolution: the ability to help parties engaged in disagreement find a resolution.
-view problems in multiple perspectives
-acitve listening, critical thinking, empathise & compromise
methods of communication
ultimately send message to another
-verbal (spoken, written)
-nonverbal (smile, body language {most important})
strategic thinkin
allows manager to see business as whole to take broad, long term view
-complex parts depend & interact with each other
-think of bus’ future direction & goals to achieve
benefits of strategic thinking VUIC
- see business in context of events & trends, identify opp/threats
- help maintain competitive position iwth constantly changing business environment
vision
shared direction allows ppl attain common goal
-provides cooperation & commitment to achieve
-eg. manager communicates goals to employees
leadership
ability to influence ppl to set & achieve specific goals
-inspires, guides & supports employees to achieve
skills of management ICSVPDFAR
interpersonal
communication
strategic thinking
vision
problem solvnig
decision making
flexibility
adaptability to change
reconciling conflicting interests of stakeholders
steps of problem solving process IGDACE
set of activities to search, identify and implement course of action to correct situation
-most vital skill to develop is ability to decide which problem give full attention & which issues priority over others
-identify causes & problem, info for alternatives, analyse them and choose one –> evaluate solution
decision making
identifying options available and choosing course of action to solve problem
-manager evaluates risk involved if decision implemented (& other options)
-part of problem solving process
proactive
management style incorporated DYNAMIC action and forward planning to achieve objectives
- »_space;> reactive
conflicting interests of stakeholders
place competing demands upon business,
-some compatible (quality products at reasonable prices), sales increase, greater profits, rewarded with higher dividends for owners
incompatible
-satisfying 1 = dissatisfying other
eg. employees & unions require safe working conditions & reasonable wages, forced to raise prices but customers want reasonably prices products
major stakeholders and conflicting interests
- customers: pressure bus to satisfy needs, act ethically, socially responsible
- employees:
- interactions with customers influences bus reputation
-motivation & skills influence quality of g&s - shareholders/owners
-demand ^profits affect strategies of bus - society/enviro
-adopt enviro sustainable practices
-conserve use of natural resources (energy, water) –> avoid pollution
-recycle products to reduce waste
-reduce electrical consumption by installing solar panels
conflicting interests between employees & shareholders
employee: safe working conditions & reasonable wages
shareholder: reduce bus profit and dividends to shareholders
conflicting interests of management & customers
management: maintain profit & high dividend to satisfy shareholders by raising prices of products
customers: upset customers who expect reasonable pricesconf
conflict between management & suppliers
management: keep costs down to improve profit
suppliers: higher prices to cover costs of providing ethical materials
triple bottom line
economic, social, enviro performance of business
-shareholder value increases through careful management of stakeholder value ensuring long term growth
-businesses socially responsible rewarded with improved business performance
hardships of being socially responsible
expensive, time consuming
-reduce competitive advantage
how can businesses reconcile conflicting interests between shareholders and employees
ESAS
- employee share acquisition schemes
-opp for eligible employees to purchase shares in bus at (often) reduced price - offer training & proff development to employees
-educated, skilled workforce more efficient –> reduce prod costs –> rising profits –> please shareholders** (high quality product to satisfy customer expectations)**
how can businesses reconcile ocnflicting interestes of various stakeholders
stakeholder engagement (business shares info with & seeks input from stakeholders, involving them in decision making)
problems of mass production
-training employees
-organising managerial structure
-scheduling complex manufacturing processes
-worker dissatisfaction
why managers should focus on triple bottom line
- increased customer loyalty — socially responsible reputation likelier to continue buying from the business.
- new customers, since existing customers refer the business
- increased sales and profits.
- lower staff turnover reducing costs of replacing staff and increasing productivity.
- competitive advantage.
goal
desired outcome bus intends to achieve within time frame
industrial revolution generated 2 perspectives of approaches
-
scientific approach
-how best to organise workers & production methods in factory -
classical bureaucratic approach
-business organisation /structure
factories ^ prod –> hire & coordinate ppl to maintain prod lvls
classical appraoch to management
how to best manage and organise workers to improve productivity (output)
scientific management (frederick taylor
studies job in great detail to discover best way to perform it (max efficiency)
-strict hierarchical structure outline responsibilities of each management lvl
-clear lines of communication, procedures, rules
-specialisation of work/force,
-impersonal evalusation
industrialised countries in early 70s Frederick Taylor management approach 4 principles
scientific management approach
1. scientifically examine each part of task to determine most efficient method for performing task
2. select suitable workers and train them to use scientifically developed work methods
3. cooperate with workers to guarantee they use scientific methods
4. divide work and responsibility so management responsible for planning, organising, controlling scientific work methods & workers responsible for carrying planned work
what did frederick taylor believe (scientific from classical approach)
to improve efficiency, systemise way job completed
-poorly skilled workforce can train to perform simple repetitive tasks effectively (divide task to smaller specific activities improve productivity)
employees follow self-interest and display natural desire to avoid work
-tight control by supervisors & managers
-management to control workers and ensure followed instructions by rigid rules & regulations based on hierarchy & authority
what dod frederick taylor use to analyse performance of certain task
TIME and MOTION STUDIES to reduce task to effective minimum standard
-reduce tasks to most simple format
-examining each step in production procedure and time taken to perform them
according to WEBER, BUREAUCRACY organisation should have 5
- strict hierarchical organisational structure
- clear lines of communication & responsibility
- specialisation (jobs break down to simple tasks)
- rules & procedures
- impersonal evaluation of employee performance toavoid favouritism & bias
Fayol 5 principles to assist managers
- discipline as feature of leadership
- org’s goals should take precedence over employee’s omdovodial interests
- rewards for effort should be fair
- security for employment is essential
- teamwork should be encouraged
3 adv of classical approach to management
- shorter decision making time
- increased productivity
- clear chain of command
4 disadv of classical appraoch to management
- specialisation & repetitive tasks –> employee boredom
- less job satsifaction –> increased staff turnover
- discourage innovation, creativity
- inflexible organisation, lower ability to adapt to changing conditions
planning organising and controlling
preparation of predetermined course of action for business
-short & long term success of business
1. vision & goalsfor bus
2. methods to achieve
3. anticipate future changes
-set goals and decide methods to achieve
ORGANISING
-determines whats done, who does, how completed
-coordinates financial, human, material resources to achieve goals
CONTROLLING
evaluate and modify tasks to ensure goals achieved
-what’s intended to happen with what occurred
3 steps of organisation process
- determine work to complete
-
group similar activities to smaller steps
improve efficiency by enabling appropriate allocation of resources - assign work, delegate authority (who does, who ensures done)
similarities betw taylor (scientific) and fayol (bureaucratic)
managers responsible for planning organising controlling
3 lvls of planning STO
- strategic (long term) planning (top management)
- tactical (medium-term) planning (middle management)
- operational (short term planning)
(frontline management)
strategic (long term) planning
-plan following 3-5 yrs
-determine where in market business wants to be
-what business wants to achieve in relation to competitors
tactical (medium term) planning
-flexible, adaptable 1-2 yrs
-implement strategic plan to respond quickly to changes
-how goals achieved through ALLOCATION of resources
operational (short term) planning
-specific details wy business operates short term
-daily management controls of operations for short term goals
-eg. daily/weekly production schedules
controlling
management attempts to evaluate performance & take corrective action to ensure objectives achieved
-compares what intended to happen with what occurred
-management check progress, make improvements to achieve goals
control process 3 steps EMC
- ESTABLISH standards with firm’s goals & influences from employees, management, industry & GVT
- MEASURE performance and determine how comparisons will be made against standards
- take CORRECTIVE ACTION
-change activities, processes & personnel to ensure goals of business met
management hierarchy
arrangement provides increasing authority at higher levels of hierarchy
-senior managers have greater accountability, responsibility & authority compared to lower lvls of pyramid
- senior management team (CEO)
- MID MANAGEMENT TEAM (department head)
- frontline management team (team supervisor)
-taller hierarchy –> more lvls management –> LONG CHAIN OF COMMAND,
characteristics of pyramid organisational structure
group ppl according to specialised functions they perform
-rigid lines of communication
-numerous lvls of management (up –> down)
-distinguished organisational positions and responsibilities
-hierarchical flows of info directed downwards
-SPECIALISATION OF LABOUR (tasks divided into separate jobs)
-CHAIN OF COMMAND shows who responsible to whom
-centralised control with all strategic decisions made by senior management
autocratic leadership style
decisions made by management, where staff have no input in decision-making process
-high task/low process
-dictates work methods
-frequently checks employee performance
-motivate through disciplinary action for compliance & obedience, negative feedback
democratic leadership style
manager consults with employees to ask suggestions and considers them when decision making
-presents problems, asks for suggestions & works together to make decision
-share decisionmaking authority
-flatter management structures & diverse groups
whatleadership stylel would managers with a strict classical-scientific approach display?
autocratic
when can autocratic leadership style be effective
time of crisis when immediate compliance with procedure needed/meeting unexpected deadline where speed important
individuals lack skills and knowledge, but doesn’t encourage best performance from employees
4 advantages of autocratic leadership style
- directions & procedures clearly defined, less chance of uncertainty
- employee roles & expectations plainly set so management can monitor performance
- hierarchical structure provides stable & consistent enviro, outcomes always match management objectives
- centralised control at top-lvl management so time used efficiently & problems dealt with quickly bc no discussion/consultation
4 disadvantages of autocratic leadership style
-
no employee input allowed,, ideas arent encouraged/shared
-employees don’t get chance to develop skills/feel valued - ignores importance of employee morale & motivation
-if no responsibility given to lower staff, job satisfaction decreases –> absenteeism & staff turnver - potential for conflict increases
-workers often competing for approval of managers, tension between employees - lack of employee input, resentment
main features of classical scientific & bureaucratic management approaches
time & motion studies to reduce inefficiencies
-production line methods/procedures
-hierarchical organisational structure
-chain of command
-autocratic leadership style
behavioural management approach
stresses employees should be main focus of way business organised
-successful management depended largely on manager’s ability to understand & work with diverse ppl
-Mayo ‘Hawthorne effect’ 1. worker satisfaction, employees social AND eco needs, positive supportive supervision and the impact of teamwork. 2. team participation ^ job satisfaction & output
-managers needed skills in communication, motivation & democratic leadership
3 advantages of behavioural approach
- increased empowerment of employees as they can take ownership of their work
- worker recognition & appreciation –> increased motivation
- improved relationships betw managers & staff
3 disadvantages of behavioural approach
- lack control
- communication confusion may arise
- difficult to accurately predict employee behaviour
qualities of a successful leader
-open mind, seeks new ideas & freely shares info
-confidence in others, shares credit & recognition
-builds & communicates clear vision to workers & motivate them
-demonstrates flexibility in dealing with conflict
ppl interact regularly & coordinate their work towards common goal
importance of teamwork
vital for managers
working separately** with no common purpose/sense of belonging to org
-flatter organisational structures, eliminating 1/+ management levels, greater responsibility to individuals in business
how can managers foster teamwork
balancing needs of team with thoseo f business
-understand views of others
-handling disagreements honestly & directly
-persuading others to adopt new ideas
-TRUST to develop common goal
-democratic leadership style
when is participative/democratic leadership style most effective
diverse groups , when business operating in environment undergoing rapid change
-business more responsive to change through improved decision making
5 advantages of participative/democratic leadership style
most important is involvement of team members in the decision-making process.
-employer & ee relations positive, reduced likelihood of industrial disputes (employees more likely to accept management decisions)
-motivation & job satisfaction optimal (employees active role allocating tasks to meet objectives)
-greater opp to acquire more skills for employees
-development of work teams with high lvls commitment
-high lvl** trust** –> high performance
5 disadvantages of participative/democratic leadership style
-reaching decisions time consuming, differing views to consider
-control of manager weakened & undermined
-internal conflict as opinions shared, disagreement
-informal system may collapse management
main features of behvioural management style
-humanistic appraoch (employees are business’ most important resource)
-employee participation in decision making
-team based structure
-managers need interpersonal skills
-participative/democratic leadership style
for behavioural management approach, main management functions are LMC
LEADING
MOTIVATING
COMMUNICATING
self-directed work teams destructuring traditional heirarchical structure
- mix ppl and functions; teams take some roles and responsibility of managers (problem solving issues)
- manager’s role from controller to facilitator
- away from an autocratic leadership style to participative democratic system.
flatter organisational structures vs traditional hierarchy
* A flat structure has fewer levels of management.
* A hierarchical structure has a long chain of command (lots of managerial levels) and a narrow span of control (the lower you are in the management levels, the less responsibility you have).
* The flat organisational structure has a shorter chain of command (fewer levels of management) and wider span of control (managers are responsible for a larger number of employees).
* The hierarchical pyramid implies that employees have very little say in how the business is run, as communication travels down the chain of command with little to no feedback from employees.
* A flat organisational structure is for teams. Everyone is responsiblefor completing the business’s objectives and is included in decision making by making suggestions/implementing changes.
contingency for managers 4
-managers borrow wide range of management approaches and practices
-managers need adaptable and flexible techniques to problem solving
-extract most useful ideas & practices from range to suit bus requirements
-appropriate management response to one set of circumstances inappropriate to another
3 advantages of contingency appraoch
- acknowledge changes in bus environment, enabling bus flexibility in reacting to change
- recognises multiple approaches to management, not one best
- diff situations demand diff approaches
disadvantages of contingency approach
- adapting to constant changes challenging for management
- selecting alternative courses of action depending on situation costly in time and money
managers using ocntingency approach need to adopt 10 commandments for the modern manager, which are
- share vision with stakeholders
- manage relationships not employees
- manage emotions & help others maintain emotional balance
- thrive on diversity, not conformity
- lead than simply managing, by inspiring trust & motivation
- cultivate ability to adapt to changing circumstances
- be aware how tech developments can improve effectiveness & efficiency
- recognise and use experiences & expertise of all employees
- encourage ethical behaviour to promote commitment in employees
interdependence
mutual dependence key bus functions (OMFH), rely on others to perform effectively, work best when overlapping and employees work towards common goals.
-each function area to performance depends on support of others
-unified approach to achieve objectives
-depends on bus goals and size
why do large businesses separate OMFH in diff divisions by separate managers?
require diff skills & knowledge for each
-as bus grows, needs more complicated, require more ppl to perform each function with specialists for each
-separate departments enables specialisation but coordination more challenging
for small businesses, does OMFH overlap or separate?
overlap
business functions should 2
- work towards fulfilling bus goals
- coordinated to have common purpose
operations
-applies manufacturin and services sector
business’s processes that involve transformation (production).
how will operations management directly affect bus’ comp adv
- quality of g&s
- prod costs
- determining if sufficient products available to satisfy customer demand.
operations management
-creating, operating, controlling transformational process takes inputs from variety of resources & produces outputs of g&s needed by consumers
-shaped by range and type of g&s produced
-differ for businesses producing goods opposed to services
-influence quality ,cost, availability of bus’ g/s for goals
how do businesses cope with enormous costs in operations processes
COST LEADERSHIP: establishing a competitive advantage by having the lowest cost of operation in the market (minimsie)
why does operations management directly affect bus’ competitive position?
- establish lvl quality of g/s
- influence overall cost of production (operations function responsible for largest part of bus’ capital and human expenses)
- determines if sufficient products available to satisfy consumer demand
characteristics of operations management in manufacturing businesses
- produce tangible goods
- manufactured goods can be stored for later use, durable
-** little customer involvement in production**
-manufactured goods usually homogenous/standardised
characteristics of operations management in service businesses
- produce intangible services
- customer involved in production, present during
-
PP and consumption occur same time
-services differentiated/tailored to individual customers
3 key elements of PP in businesses
inputs
processes
outputs
differ betw manufacturing & service businesses
-operations management determines how efficiently business produces g/s to meet needs of customers
inputs
**resources used in PP(transformation)
-from suppliers or already owned
-can divide into transformed & transforming resources
