Figure 1.

1: Four
Reasons To Study Management
Principles of Management
Dyck / Neubert

Chapter 1
Introduction to Management

Important Managerial Skills Types of Managers

Technical Skills First-Line Supervisors

Expertise in a particular areamarketing, Manage the work of employees who are
accounting, finance or human resources involved in the actual production or creation
Human Skills of an organizations products or services.
Abilities in getting along with people, Middle Managers
leadership, helping others to be motivated, Manage first-line managers and others.
communication and conflict resolution Top Managers
Conceptual Skills Have organization-wide managerial
The ability to think about complex and broad responsibilitiesChief Executive Officers
organization issues (CEOs), Vice-Presidents, and Board Chairs

Functions of Management
What Is Management?
(Fayol)
Management Four Management Functions:
The process of planning, organizing, leading Planning
and controlling human and other Organizing
organizational resources towards the Leading
effective achievement of organizational goals.
Controlling
Organization
A goal-directed (planning), deliberately-
structured (organizing) group of people
working together (leading) to achieve results
(controlling).

1
 Fayols Functions
Managerial Roles (Mintzberg)
and Mintzbergs Roles
Interpersonal Roles Fayol Mintzberg
Leader, Liaison and Figurehead Planning Entrepreneur, negotiator,
Decisional Roles spokesperson
Resource Allocator, Negotiator, Entrepreneur, Organizing Resource allocator
Crisis Handler
Informational Roles Leading Leader, liaison, disseminator
Monitor, Disseminator, and Spokesperson Controlling Monitor, crisis handler, figurehead

Defining Effective
From Mainstream to Multistream
Management
Effectiveness Mainstream Management
Choosing the right organizational goals to Emphasizes materialism and individualism
pursue Effective management is about maximizing
What about moral obligations? productivity, profitability and competitiveness.
Is profit-maximization a legitimate goal? Self-interest serves organizational needs.

Efficiency Multistream Management

The level of output that is achieved with a Emphasizes multiple forms of well-being for
given level of inputs multiple stakeholders
Maximizing output while minimizing inputs Effective management is about working with
stakeholders towards creating a balance among
multiple forms of well-being.

The Task And Macro

Environments Of Management
Principles of Management Task Environment Macro Environment
Dyck / Neubert Has the greatest Contains four
immediate dimensions:
influence on Socio-cultural
managers. Natural
Contains four key Political-legal
Chapter 3
The Task and Macro Environments of groups of Economic-
Management stakeholders: technological
Customers
Members
Owners
Other organizations

2
 Figure 3.1: Three Basic Levels
of the Environment for Managers
Summary: Task Environment

All managers must pay attention to key

stakeholders to:
Ensure that they are in tune with customer
needs and wants to serve them adequately.
Attract and retain an adequately qualified
workforce.
Ensure that owners needs are met.
Develop and maintain relationships with
suppliers, competitors and neighbors.

Summary: Mainstream
Summary: Macro Environment
Approach
Managers must pay attention to the key
dimensions of their macro environment to: Managers realize that their organizations
Monitor socio-cultural trends and changes in financial goals are enhanced by attending
demographics, health care, education and to stakeholders in the task environment as
other social institutions. follows:
Consider how sensitive they will be with
Offering customer service and profitably
respect to the natural environment.
exploiting consumer wants.
Keep informed of developments in the
Maximizing workers productivity.
political-legal environment.
Maximizing financial returns to owners.
Pay close attention to economic opportunities
and threats and remain technologically Gaining power over suppliers and
competitive. competitors.

Summary: Mainstream Approach Summary: Multistream

(contd) Approach
Managers realize that their organizations Managers realize that overall
financial goals are enhanced by attending organizational well-being is enhanced by
to the macro-environment as follows: attending to stakeholders in the task
Nurturing a materialist-individualist socio- environment as follows::
cultural environment. Offering customer service and profitably
Acquiring raw materials and disposing of exploiting consumer wants
waste as cheaply as possible. Maximizing workers productivity
Lobbying for managerial rights and Maximizing financial returns to owners
marketplace rules in their favor. Gaining power over suppliers and
Maintaining a short-term and exploitive competitors.
approach to economics and technology.

3
 Summary: Multistream Approach Summary: Multistream Approach
(contd) (contd)

Managers realize that their organizations Managers realize that their organizations
financial goals are enhanced by attending financial goals are enhanced by attending
to the macro-environment as follows: to the macro-environment as follows:
Offering customer service and identifying un- Nurturing social justice and well-being,
met consumer needs Practicing sustainable use of natural and
Engaging workers via meaningful work and human resources,
productivity Lobbying for sustainable and
Serving owners multiple forms of well-being environmentally-friendly markets,
Fostering healthy relationships among Using a long-term and needs-based
organizations approach to economics and technology.

Figure 4.1: Ways to

Internationalize an Organization
Principles of Management
Dyck / Neubert

Chapter 4
The International
Environment

How to Internationalize How to Internationalize

an Organization (contd) an Organization (contd)
Exporting Global Outsourcing
When an organization manufactures products When one or more sub-components for an
in its home country and transports them to organizations products or services are
other countries for sale there. imported from another country.
Importing Counter-Trade
When a finished product is brought in from When products or services from one country
another country for resale domestically. are traded (rather than bought and sold for
currency) for products or services from
another country.

4
 How to Internationalize How to Internationalize
an Organization (contd) an Organization (contd)
Licensing Strategic Alliance
When an organization in one country sells When managers from organizations in at
specific resources to an organization in least two countries agree to pool their
another country. organizations resources and know-how in
Franchising order to share the risks and rewards for
developing a new market or product.
When a franchisor in one country sells to a
franchisee in another country a complete Joint Venture
package required to set up an organization. When partnering organizations agree to form
a separate, independent, jointly-owned
organization.

How to Internationalize Figure 4.3: Overview of Hofstedes

an Organization (contd) Five Dimensions of National Culture
Foreign Subsidiaries
Maquiladoras
Are assembly plants and factories in special
regions in Mexico along the U.S. border where
international corporations can take advantage of
low wages and also enjoy low duties and tariffs
when their products are exported to the U.S.

Hofstedes Dimensions of
National Culture (contd) Figure 4.4: Relative Emphasis of Countries on
Hofstedes Materialism/ Individualism Scores
Materialism
Is placing a high value on things like getting
better jobs, material possessions, money and
assertiveness.
Quality of Life
Is emphasized in cultures that overall tend to
value relationships, the welfare of others, and
the intrinsic satisfaction that comes from
performing meaningful work.

5
 Hofstedes Dimensions of Hofstedes Dimensions of
National Culture (contd) National Culture (contd)
Time Orientation Uncertainty Avoidance
Short-term cultures live in the present. High uncertainty
Long-term cultures have a greater concern avoidance cultures
for the future. prefer predictable
rules and regulation
Deference to Authority over ambiguity and
The relative emphasis that a culture places risk.
on power differences Low uncertainty
avoidance cultures
value risk-taking and
innovativeness.

Why Study Ethics?

Principles of Management The emphasis on ethics is related to:
Dyck / Neubert The world is changing rapidly.
Unethical decisions by managers are
receiving more attention.
Managers are moral agents.
Chapter 5
Ethics

Components of Management
What Is Ethics?
Ethics
Ethics 1. Sources where a manager may get their
A set of principles or moral standards that moral standards
differentiate right from wrong. 2. The moral-point-of-view that a manager
Management Ethics follows
The study of moral standards and how they 3. The process a manager uses to make
influence managers actions. decisions that are ethical
4. The influence of ethics on how managers
practice the four management functions

6
 Table 5.1: The Four
Sources of Management Ethics
Types of Sources of Ethics
Informal/Public
Work experiences, peers, managers
Ethical climate
The informal shared perceptions of what are
appropriate practices and procedures
Informal/private
Examples set by the behavior of immediate
family members
Family, friends, peer groups, society, and
unspoken universal human norms

Levels of Personal Moral Figure 5.2: Increasing

Development Levels of Moral Development
Pre-conventional
What is rewarded and punished
Self-interest: Whats in it for me?
Conventional
Social norms or external standards
By others: What is everyone else doing?
Post-conventional
Universal principles established through
conscience and reason
What are timeless truths?

Introduction to Decision-Making

Principles of Management Decision

Dyck / Neubert A choice that is made among a number of
available alternatives.
Decision Process
1. Identify the need for a decision
Chapter 7 2. Develop alternative responses
The Decision-Making Process
3. Choose the appropriate alternative
4. Implement the chosen alternative

7
 Figure 7.1: The Four-step Mainstream Approach to the
Decision-making Model Four-Step Decision-Making
Process
Step 1: Identify the need for a decision
Identifying problems and opportunities to
meet or surpass financial goals
Using learned scripts:
Programmed decisions
Non-programmed decisions
Mistaking symptoms for the underlying issue

Figure 7.2: Considerations Mainstream Approach to the

that Influence How Much Time Four-Step Decision-Making
Managers Invest in Developing Alternatives
Process
Step 3: Choose the appropriate alternative
Choose an alternative, using a method based
on how much goal consensus and knowledge
is available for each alternative.
Key Factors:
Goal consensus about which goals to pursue
Available knowledge about:
How to achieve goals
Uncertainty about outcomes
Risk that alternative will result in negative outcome

Decision Making Approaches Decision-Making Approaches

(contd)

Classical Rational Approach Random (low consensus, low knowledge)

High consensus, high knowledge No agreement on goals and lack of
Political Approach knowledge about how to reach goals
Low consensus, high knowledge Administrative model (medium consensus,
Incremental Trial-and-Error Approach medium knowledge)
Bounded rationality
High consensus, low knowledge
Limited cognitive capabilities and personal biases
Continuous improvement
Limited informationanchoring, past practices
Intuition Limited resources for processing information
Satisficingchoosing an adequate response

8
 Mainstream Approach to the
Poor Decisions
Four-Step Decision-Making
Process Causes
Failure to recognize significance of problem
Step 4: Implement the chosen alternative
Lack of participation
Implement the alternative. Use a participative
Insufficient information
approach to overcome resistance
Involving members in earlier steps Failure to delegate/facilitate decisions
Factors in implementation Lack of commitment and support
Significance of the problem for the organization Persistence Errors
Competency to analyze the problem and develop Escalation of commitment
alternatives
Information distortion
Availability of adequate knowledge
Commitment to implementing the alternative Administrative inertia

Introduction to Goals and Plans

Principles of Management Goals

Dyck / Neubert The desired results or objectives that
members in an organization are pursuing.
Plans
Describe the steps and actions that are
Chapter 8 required to achieve goals.
Setting Goals and
Making Plans

Figure 8.1: Overview of the

The Planning Process Four Steps of the Planning Process

Steps in the Planning Process

1. Setting an organizations overarching mission
and vision.
2. Setting strategic goals and plans.
3. Taking the strategic goals and plans and
putting them into practice in everyday
operations.
4. Implementing and monitoring the goals and
plans.

9
Organizational Goals and Plans Mission Statements

Ongoing Goals and Plans Mission Statement

Guide the continuing activities that are Identifies the fundamental purpose of the
consistent with the basic purpose of the organization.
organization. Describes what the organization does, whom it
serves, and how it differs from similar
Change-Oriented goals and Plans organizations.
Refer to new initiatives and changes to be Can provide social legitimacy and a sense of
made in an organizations practices. identity for the members of the organization.

Mission Statements (contd) Vision Statements

Ideas are commonly mentioned in mission Vision Statement

statements: Describes what an organization is striving to
Products/services become.
Customers Provides guidance to organizational
Organizational self- members.
Survival/growth/pro Describes goals that an organization hopes to
Employees achieve five or more years into the future.
Markets
Philosophy
Technology
Public image

The Mainstream The Mainstream Approach

Approach to Goals and Plans to Goals and Plans (contd)
Step 1: Develop the Organizations Step 2: Develop Strategic Goals and Plan
Overarching Mission and Vision How managers can position the organization
Mission/Vision Focus: in the eyes of stakeholders so as to achieve
Top-down management of the planning process to advantages over its competitors.
enhance financial well-being. Step 3: Develop Operational Goals
Focus is on things that will contribute to the future
competitiveness and financial success of an
and Plans
organization. Are set by lower-level managers.
Have a less than one-year time horizon.

10
 Figure 8.2: The Five
The Mainstream Approach
Characteristics of Mainstream
to Goals and Plans (contd)
Goals
Stretch Goals (Jack Welch)
Are so difficult that people do not know how
to reach them.
Cannot be achieved simply by making
incremental changes to the status quo.
Require outside-the-box thinking that
dramatically improves productivity, efficiency,
and profitability.

Figure 8.3: Checklist

Why Goals Arent Achieved
for Making a Plan
Unexpected changes in other parts of the
organization or in the larger environment
Some stakeholders are not convinced of
the legitimacy of a goal.
Too much emphasis placed on members
change-oriented goals rather than on their
ongoing goals.

Importance of Strategic
Management
Principles of Management Why Is Strategic Management Important?
Dyck / Neubert Because managers vary in how well they
formulate and implement strategies, and this
affects their organizations competitiveness.
Strategic management
Chapter 9 The analysis and decisions that are necessary to
formulate and implement strategy.
Strategic Management
Strategy
The combination of goals, plans and actions
designed to accomplish an organizations mission.

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 Figure 9.1: Overview of the
Strategic Management Process Strategic Management Process
1.Review the mission and vision of the
organization
2.Analyze the organizations external
environments and internal resources
3.Choose and develop the strategy to be
followed
4.Implement the chosen strategy.

Mainstream Strategic
SWOT Analysis
Management
Strengths Valuable or unique resources of an organization
Step 1: Review mission and vision or any activities that it does particularly well that
can help managers to achieve their strategic
Emphasis is on maximizing competitiveness. objectives.
Plan is revisited on a regular basis. Weaknesses A lack of specific resources or abilities that an
organization needs in order for it to do well; a
Step 2: Analyze internal and factors characteristic that hinders the achievement of the
(SWOT) strategic objectives of an organization.
Internal strengths and weaknesses Opportunities Conditions in the external environments that have
the potential to help managers meet or exceed
External opportunities and threats organizational goals.
An analysis of the external environment is key Conditions in the external environments that have
Threats
to uncovering what current and future the potential to prevent managers from meeting
opportunities and threats might exist. organizational goals.

Table 9.1: Overview of Porters Five

Competitive Forces and Strategic
Strategies
Management
Competitive Strategy
A strategy that seeks to create value for
customers by providing low prices or unique
features that are not offered by rival
organizations.
Sustained Competitive Advantage
A competitive strategy that other
organizations are unable to duplicate.

12
 Mainstream Strategic
Business-Level Strategies
Management
Step 3: Formulate Strategy Cost Leadership
Competing within a specific industry Increase the profit margin by keeping overall
Business level strategies costs lower than competitors through
Cost leadership strategy efficiencies in production and distribution.
Differentiation
Maintaining price and quality at roughly the
Focus strategy
same level as competitors.
Competing multiple industries
Gaining economies of scale as the market
Diversification strategies
leader.
Related
Unrelated

Business-Level Strategies Diversification Strategies

(contd)
Differentiation Strategy Related Diversification
Offering a product or service with a significant Involves expanding an organizations activity
difference for which buyers are willing to pay in industries related to its current activities.
a higher price than they would for a Synergy
competitors product or service.
The performance gain that results from two or
Focus Strategy more units working together is greater than
Choosing a small niche in the overall market. the sum of their individual contributions.
Strategy can be based on either cost
leadership or differentiation.

Diversification Strategies (contd) Diversification Strategies (contd)

Horizontal Integration Unrelated Diversification

Services and products are expanded or Occurs when an organization grows by
offered in new markets. acquiring or entering new industries unrelated
Vertical Integration to its current activities.
Occurs when an organization produces its Reasons for diversification:
own inputs (backward integration) or sells its When there are no opportunities for expansion in
current markets.
own outputs (forward integration).
When current markets are beginning to decline.

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 Figure 9.2: BCG Portfolio Matrix
Business Portfolio Planning for Managing Diversified Organizations
BCG Matrix
Developed by the Boston Consulting Group.
Classifies portfolio businesses by relative
market share (strength) and market growth
rate (potential).
Starshigh growth, high market share
Cash cowslow growth, high market share
Question markshigh growth, low market share
Dogslow growth, low market share
Is limited by its focusing exclusively on
market share and market growth.

Figure 9.3: The Product Life Mainstream Strategic

Cycle Management
Step 4: Implement Strategy
Content school approach to strategy
Emphasizes the rational-analytic, top-down and
linear aspects of strategy formulation.
Aligned with mainstream approach.
Process school of strategic management
Bottom-up, emergent (un-planned), and egalitarian
approach that emphasizes strategic learning
strategy formulation and implementation are
ongoing and iterative.
Aligned with the Multistream approach.

14