Chapter 1

Introduction to Management and Organizations

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Learning Outline
After you read this chapter you should know the following learning objectives:

#1: #2: #3: #4: #5:

What Makes Someone A Manager? What Is Management and What Do Managers Do? What Characteristics Define An Organization? What Are The Challenges To Managing? Does Studying Management Make A Difference?
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Defining the Managers Terrain

Managers:
Coordinate work activities to achieve organizational goals. Their ability to act is affected by both the internal culture of the organization and the constraints of the external environment including the global environment.

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Defining the Managers Terrain

Managers:
Also deal with complicated ethical and social responsibility issues as they plan, organize, lead and control.

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Defining the Managers Terrain

When considering the managers terrain, managers might ask these questions:
What is my role as a manager? What constraints do I face as a manager both within the organization and from the external environment? How does the global environment affect my ability to manage? What can I do to be an ethical and socially responsible manager?

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Who Are Managers?

Manager
Someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals

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Types of Managers
First-line Managers
Managers at the lowest level manage the work of nonmanagerial employees directly or indirectly involved with the production or creation of the organizations products.

Middle Managers
Managers between the first-line level and the top level of the organization who manage the work of first-line managers

Top Managers
Managers at or near the top level are responsible for making organization-wide decisions and establishing plans and goals affecting the entire organization
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Exhibit 1.1 Managerial Levels

Top Managers Middle Managers First-Line Managers Nonmanagerial Employees

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Efficiency and Effectiveness

Managerial Concerns
Efficiency Doing things right
Getting the most output from the least amount of inputs

Effectiveness Doing the right things

Completing activities so that organizational goals are achieved
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Exhibit 1.2 Efficiency and Effectiveness in Management

Efficiency (Means) Resource Usage Low Waste Effectiveness (Ends) Goal Attainment High Attainment

Management Strives for: Low Resource Waste (high efficiency) High Goal Attainment (high effectiveness)
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Management Functions
According to the functions approach, managers perform certain activities or duties as they efficiently and effectively coordinate the work of others. Henry Fayol first proposed that all managers perform five functions: planning, organizing, commanding, coordinating and controlling.

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Exhibit 1.3 Management Functions

Planning Defining goals, establishing strategy, and developing sub-plans to coordinate activities Organizing Determining what needs to be done, how it will be done, and who is to do it Leading Directing and motivating all involved parties and resolving conflicts Controlling Lead to Monitoring activities to ensure that they are accomplished as planned Achieving the organizations stated purpose

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Management Roles
Henry Mintzbergs Management Roles Approach (Exhibit 1.4)
Interpersonal roles
Figurehead, leader, liaison

Informational roles
Monitor, disseminator, spokesperson

Decisional roles
Entrepreneur, disturbance handler, resource allocator, negotiator

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Management Roles
Robert Katz Management Skills Approach
Technical skills
Knowledge and proficiency in a specific field

Human skills
The ability to work well with other people

Conceptual skills
The ability to think and conceptualize about abstract and complex situations concerning the organization

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Exhibit 1.5 Skills Needed at Different Management Levels

Top Managers Middle Managers Lower-level Managers Importance Conceptual Skills Human Skills Technical Skills

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What Is an Organization?
An Organization Defined
A deliberate arrangement of people who act together to accomplish some specific purpose

Common Characteristics of Organizations

Distinct purpose Composed of people Deliberate structure

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Exhibit 1.6 Characteristics of Organizations

Distinct Purpose Deliberate Structure People

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Exhibit 1.7 The Changing Organization

Traditional
Stable Inflexible Job-focused Work is defined by job positions Individual-oriented Permanent jobs Command-oriented Managers always make decisions Rule-oriented Relatively homogeneous workforce Workdays defined as 9 to 5 Hierarchical relationships Work at organizational facility during specific hours

New Organization
Dynamic Flexible Skills-focused Work is defined in terms of tasks to be done Team-oriented Temporary jobs Involvement-oriented Employees participate in decision making Customer-oriented Diverse workforce Workdays have no time boundaries Lateral and networked relationships Work anywhere, anytime
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The Types of Organizations

Managers and employees work in a variety of sizes of organizations Large organizations represent only 2% of the organizations in Canada Small business represent 98% of all Canadian companies Managers and employees work in a variety of organizations, and the type of organization has an impact on what managers can do Publicly held organizations Privately held organizations Public sector organizations Crown Corporations Subsidiaries of foreign organizations (e.g., Sears, Safeway, General Motors, and Ford Motor Company)
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Challenges to Managing
Ethics
Rules and principles that define right and wrong behaviour Increased emphasis on ethics education seen in university and college curriculums Increased creation and use of codes of ethics by businesses currently

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Challenges to Managing
Workforce Diversity
The mix of people in organizations in terms of gender, race, ethnicity, disability, sexual orientation, age, demographic characteristics such as education and socio-economic status

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Challenges to Managing
Globalization
Management in international organizations Political and cultural challenges of operating in a global market

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Challenges to Managing
Managing in an E-Business World
The work performed by an organization using electronic linkages to its key constituencies E-commerce: the sales and marketing component of an e-business

Categories of E-businesses
E-businessenhanced organization E-businessenabled organization Total e-business organization
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Exhibit 1.8 Categories of E-Business Involvement

E-BusinessEnhanced Organization E-business units within traditional organization Total E-Business Organization Organizations entire work processes revolve around e-business model

E-BusinessEnabled Organization E-business tools and applications used within traditional organization

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Challenges to Managing
Customers
Customers have more opportunities than ever before Delivering consistent high-quality service is essential Managers need to create customer-responsive organizations

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Challenges to Managing
Innovation
Nothing is more risky than not innovating Doing things differently, exploring new territory, and taking risks Managers need to encourage all employees to be innovative

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Challenges to Managing
Knowledge Management
The cultivation of a learning culture where organizational members systematically gather and share knowledge with others in order to achieve better performance

Learning Organization
An organization that has developed the capacity to continuously learn, adapt, and change
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Exhibit 1.9 Learning Organization vs. Traditional Organization

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Why Study Management?

The Value of Studying Management
The universality of management
Good management is needed in all organizations

The reality of work

Employees either manage or are managed

Self-employment
Running your own business rather than working for someone else

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Exhibit 1.10 Universal Need for Management

All Sizes of Organizations Small Large

All Organizational Areas Manufacturing Marketing Human Resources Accounting Information Systems etc.

Management Is Needed in...

All Types of Organizations Profit Not-for-Profit

All Organization Levels Bottom Top

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Summary and Implications

What makes someone a manager?
Managers work with and through other people by coordinating employee work activities in order to accomplish organizational goals.

What is management and what do managers do?

Management is coordinating work activities so that they are done efficiently and effectively.

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Summary and Implications

What characteristics define an organization?
Managers work in a variety of organizations both large and small within various industries

What are the challenges to managing?

The greatest managerial challenge is the crisis in ethical responsibility damaging todays organizations

Does studying management make a difference?

Understanding management helps us to improve organizations

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