Chapter 7 The Nature of Management

Summary

Objectives:

 

Chapter Outline:

    1. Define management and explain its role in the achievement of organizational objectives.
      1. Management -- the process designed to achieve an organization’s objectives by using its resources (people, raw materials and equipment, money and information) effectively and efficiently in a changing environment.
      2. Managers make decisions that determine the use of the organization’s resources.

       

    2. Describe the major functions of management
      1. Planning – determining the organization’s objectives and deciding how to accomplish them.
        1. Objectives are determined through the organization’s mission.
        2. 3 Types of Plans
          1. Strategic – long range
          2. Tactical – short range
          3. Operational – very short range
        3. Crisis management or contingency planning
          1. Deals with potential disasters
      2. Organizing – important management function as it helps create synergy, establishes lines of authority, improves communication, helps avoid duplication, and can improve competitiveness.
      3. Staffing – hiring people to carry out the work of the organization
      4. Directing – motivating and leading employees to achieve organizational objectives
      5. Controlling – process of evaluating and correcting activities.
        1. 5 Activities:
          1. Measuring performance
          2. Comparing present performance with standards or objectives
          3. Identifying deviations from the standards.
          4. Investigating causes of deviations
          5. Taking corrective action

       

    3. Distinguish among three levels of management and the concerns of managers at each level.
      1. Three levels of management that form a pyramid
        1. Top managers
          1. Focused on planning and strategy
          2. Represent company to public and government regulators
        2. Middle managers
          1. Tactical planning
          2. More focused on organizing
        3. First-line managers
          1. Supervise workers directly
          2. Directing and controlling
      2. Functional areas of management
        1. Financial manager
        2. Production and operations managers
        3. Human resources managers
        4. Marketing managers
        5. Administrative managers

    4. Specify the skills managers need in order to be successful
      1. Managers evaluated on basis of effectiveness and efficiency
      2. Skills required
        1. Leadership
          1. Autocratic – make all decisions; tell employees
          2. Democratic – allow employees involvement in decisions
          3. Free-rein – allow employees to work without much interference
        2. Technical expertise
          1. Needed by all managers
        3. Conceptual skills
          1. Particularly important for top-level managers
        4. Analytical skills
          1. Most important for top-level managers
        5. Human relations skills
          1. Particularly important in organizations that provide services.

       

    5. Summarize the systematic approach to decision making used by many business managers
      1. Decision-making is important in all management functions and at all management levels.
      2. 6-Step approach to effective decision making:
        1. Recognize and define the decision situation
        2. Develop options
        3. Analyze options
        4. Select the best option
        5. Implement the decision
        6. Monitor the consequences