Basic Management

Principles & Theories

WEEK 1
Management Key Concepts
Organizations: People working together
and coordinating their actions to achieve
specific goals.
Goal: A desired future condition that the
organization seeks to achieve.
Management: The process of using
organizational resources to achieve the
organizations goals by...
Planning, Organizing, Leading, and
Controlling
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Four basic management approaches

Classical
Behavioral
Management science
Integrative system
MANAGEMENT THEORIES
Additional Key Concepts
Resources are organizational assets and
include:
People,
Machinery,
Raw materials,
Information, skills,
Financial capital.
Managers are the people responsible for
supervising the use of an organizations
resources to meet its goals.
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Achieving High Performance
Organizations must provide a good or service
desired by its customers.

David Johnson of Campbell Soup manages his
firm to provide quality food products.
Physicians, nurses and health care
administrators seek to provide healing from
sickness.
McDonalds restaurants provide burgers, fries
and shakes that people want to buy.
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Organizational Performance

Measures how efficiently and effectively
managers use resources to satisfy
customers and achieve goals.

Efficiency: A measure of how well
resources are used to achieve a goal.
Usually, managers must try to
minimize the input of resources to
attain the same goal.
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Effectiveness: A measure of the
appropriateness of the goals chosen
(are these the right goals?), and the
degree to which they are achieved.

Organizations are more effective
when managers choose the correct
goals and then achieve them.

Managerial Functions
Henri Fayol was the first to describe the four
managerial functions when he was the CEO
of a large mining company in the later
1800s.

Fayol noted managers at all levels,
operating in a for profit or not for profit
organization, must perform each of the
functions of: Planning, organizing, leading,
controlling.
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Four Functions of Management
Planning
Choose Goals
Organizing
Working together
Leading
Coordinate
Controlling
Monitor & measure
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Planning
Planning is the process used by
managers to identify and select
appropriate goals and courses of action
for an organization.

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3 steps to good planning :

1. Which goals should be pursue?
2. How should the goal be attained?
3. How should resources be allocated?
The planning function determines
how effective and efficient the
organization is and determines the
strategy of the organization.

Organizing
In organizing, managers create the
structure of working relationships between
organizational members that best allows
them to work together and achieve goals.

Managers will group people into
departments according to the tasks
performed.
Managers will also lay out lines of
authority and responsibility for members.
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An organizational structure is the
outcome of organizing. This structure
coordinates and motivates employees so
that they work together to achieve goals.

Leading
In leading, managers determine direction,
state a clear vision for employees to follow,
and help employees understand the role
they play in attaining goals.
Leadership involves a manager using power,
influence, vision, persuasion, and
communication skills.
The outcome of the leading function is a
high level of motivation and commitment
from employees to the organization.
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Controlling
In controlling, managers evaluate how well
the organization is achieving its goals and
takes corrective action to improve
performance.
Managers will monitor individuals,
departments, and the organization to
determine if desired performance has been
reached.
Managers will also take action to
increase performance as required.
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The outcome of the controlling function is
the accurate measurement of
performance and regulation of efficiency
and effectiveness.

Management Levels
Organizations often have 3 levels of
managers:
First-line Managers: responsible for day-
to-day operation. They supervise the
people performing the activities required
to make the good or service.
Middle Managers: Supervise first-line
managers. They are also responsible to
find the best way to use departmental
resources to achieve goals.
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Top Managers: Responsible for the
performance of all departments and
have cross-departmental
responsibility. They establish
organizational goals and monitor
middle managers.

Top
Managers
Middle
Managers
First-line Managers
Non-management
Three Levels of Management
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Restructuring
Top Management have sought methods to
restructure their organizations and save
costs.
Downsizing: eliminate jobs at all levels of
management.
Can lead to higher efficiency.
Often results in low morale and
customer complaints about service.
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Management Trends
Empowerment: expand the tasks and
responsibilities of workers.
Supervisors might be empowered to
make some resource allocation
decisions.
Self-managed teams: give a group of
employees responsibility for supervising
their own actions.
The team can monitor its members and
the quality of the work performed.
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Managerial Roles
Described by Mintzberg.
A role is a set of specific tasks a person
performs because of the position they
hold.
Roles are directed inside as well as
outside the organization.
There are 3 broad role categories:
1. Interpersonal
2. Informational
3. Decisional
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Interpersonal Roles
Roles managers assume to coordinate and
interact with employees and provide direction
to the organization.
Figurehead role: symbolizes the organization
and what it is trying to achieve.
Leader role: train, counsel, mentor and
encourage high employee performance.
Liaison role: link and coordinate people inside
and outside the organization to help achieve
goals.
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Informational Roles
Associated with the tasks needed to obtain and
transmit information for management of the
organization.
Monitor role: analyzes information from both the
internal and external environment.
Disseminator role: manager transmits
information to influence attitudes and behavior of
employees.
Spokesperson role: use of information to
positively influence the way people in and out of
the organization respond to it.
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Decisional Roles
Associated with the methods managers
use to plan strategy and utilize
resources to achieve goals.
Entrepreneur role: deciding upon new
projects or programs to initiate and
invest.
Disturbance handler role: assume
responsibility for handling an unexpected
event or crisis.
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Resource allocator role: assign
resources between functions and
divisions, set budgets of lower
managers.

Negotiator role: seeks to negotiate
solutions between other managers,
unions, customers, or shareholders.

Managerial Skills
There are three skill sets that managers need to
perform effectively.
1.Conceptual skills: the ability to analyze and
diagnose a situation and find the cause and
effect.
2.Human skills: the ability to understand, alter,
lead, and control peoples behavior.
3.Technical skills: the job-specific knowledge
required to perform a task. Common examples
include marketing, accounting, and
manufacturing.
All three skills are enhanced through formal
training, reading, and practice.
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Management Challenges
Increasing number of global organizations.
Building competitive advantage through
superior efficiency, quality, innovation, and
responsiveness.
Increasing performance while remaining ethical
managers.
Managing an increasingly diverse work force.
Using new technologies.
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