MGT 300 1st EditionExam # 2 Chapters 5-8- Organizational culture o system of shared beliefs and values that develops within an organization and guides the behavior of its memberso Also called corporate culture Clan culture  Internal focused values flexibility rather than stability  encourages collaboration among employees Zappos shoes, Southwest Airlines Adhocracy culture  creates innovative products by being adaptable, creative, and quick to respond to the marketplace  Market culture  focused on the external environment  driven by competition and a strong desire to deliver results Kia, financial firms Hierarchy culture  Formalized structured work environment aimed at achieving effectiveness through a variety of control mechanisms; very regimented  GM, UPSThree levels of organizational culture- Observable artifacts- Espoused valueso Enacted values- Basic assumptionsLearning culture- Symbol, story, hero, rites and ritualsOrganization- non-profit, for-profit, and mutual-benefitTypes of structures- simple- authority is centralized in a single person with few rules and low work specialization- functional- people with similar occupational specialties are put together in formal groups- divisional- people with diverse occupational specialties are put together in formal groups by similar products, customers or geographic regions- Matrix- an organization combines functional and divisional chains of command in a grid so that there are two command structures-vertical and horizontal- Horizontal design- improve collaboration and work on shared tasks- Hollow- central core of key functions and outsources- Modular- product chunks by outside contractorsNewsLittle Caesars new bacon pizza 450 calories/ sliceVideo about baconFederal reserve s&p 500 set record, economy is getting betterPolicy on short-term interest ratesBalances growth with inflationInterest rates have not rose since 2008Central high school football on espnMcdonalds worldwide decrease 18% asia 12.6 % US up .5% reported serving expired food new ceo steve easterbrock in food developmentGreece bailout/defaultDefault on bonds not making payments new prime minister wont work on the buyoutPIGS- Portugal Italy spain and Greece which are the weaker countriesGoogle video about their company culture and how it is different from everyone else, very laid back.Nonrational models of decision making assume that decision making is nearly always uncertain and risky, making it difficult for managersto make optimal decisionsBounded Rationality suggests that the ability of decision makers to be rational is limited by numerous constraintscomplexity, time and money, cognitive capacityintuition- decision based off of feelingsValue orientation – reflects the extent to which a person focuses on either task and technical concerns orpeople and social concerns when making decisionsTolerance for ambiguity – extent to which a person has a high need for structure or control in his lifedifferent types of decision making stylesImportance, credibility and urgency on decisionsBiasesAvailabilityRepresentivenessConfirmationSUNK COSTAnchoring and adjustingOverconfidenceHindsightFramingEscalation of commitmentSTRATEGY-Sustainable competitive advantage- example is ford transforming the car into a powerful smartphoneSMART GOALS- specific, measurable, attainable, results-oriented, target datesSpecific: Goals should be stated in specific rather than vague terms. Thegoal that “As many planes as possible should arrive on time” is too general.The goal that “Ninety percent of planes should arrive within 15 minutesof the scheduled arrival time” is specific.• Measurable: Whenever possible, goals should be measurable, or quantifiable(as in “90% of planes should arrive within 15 minutes . . .”). That is,there should be some way to measure the degree to which a goal has beenreached.Of course, some goals—such as those concerned with improvingquality—are not precisely quantifiable. In that case, something on theorder of “Improve the quality of customer relations by instituting 10 follow-uptelephone calls every week” will do. You can certainly quantify howmany follow-up phone calls were made.• Attainable: Goals should be challenging, of course, but above all theyshould be realistic and attainable. It may be best to set goals that are quiteambitious so as to challenge people to meet high standards. Always, however,the goals should be achievable within the scope of the time, equipment,and financial support available. (See Figure 5.4 . )If too easy (as in “half the flights should arrive on time”), goalswon’t impel people to make much effort. If impossible (“all flights mustarrive on time, regardless of weather”), employees won’t even bothertrying. Or they will try and continually fail, which will end up hurtingmorale.• Results-oriented: Only a few goals should be chosen—say, five for anywork unit. And they should be results-oriented —they should support theorganization’s vision.In writing out the goals, start with the word “To” and follow itwith action-oriented verbs—“complete,” “acquire,” “increase” (“to decreaseby 10% the time to get passengers settled in their seats beforedeparture”).Some verbs should not be used in your goal statement because theyimply activities—the tactics used to accomplish goals (such as having baggagehandlers waiting). For example, you should not use “to develop,” “toconduct,” “to implement.”• Target dates: Goals should specify the target dates or deadline dates whenthey are to be attained. For example, it’s unrealistic to expect an airline toimprove its on-time arrivals by 10% overnight. However, you could set atarget date—3 to 6 months away, say—by which this goal is to be achieved.That allows enough time for lower-level managers and employees torevamp their systems and work habits and gives them a clear time framein which they know what they are expected to do.creation of a unique and valuable position requires trade offs and involves creating a fit synergy if effectiveFew needs, many customersBroad needs, few customersBroad needs, many customersMain topics on test-SWOTCultureStrategiesMBO- management by objectiveBiasUnity of commandGroupthinkSunk-costSMARTCentralized and decentralizedDelegationOrganizational structureSWOT-strengths, weaknesses, opportunities, threats careful monitoring of an organization’s internal and