Basics of Management Leadership Autocratic dictatorial Participative group participation Free rein employee empowerment freedom Management and Organization Controlling 5 basic steps Establish clear standards Monitor performance Evaluate results Communicate results Corrective actions Staff feedback not always Accounting and finance provides data necessary to review performance Customer service benchmarks helped management evaluate their staffs performance Most businesses measure customer satisfaction both internal and external Organization Personnel levels Level Top Middle First Line Staff Population Example Senior Executives Chief Operating Officer Mid Level Managers Regional Manager Supervisory Managers Store Manager Non Exempt Employees Hourly Worker Non exempt employees are covered by the fair labor standards act s minimum wage and overtime pay provisions Exempt employees are typically executives administrators professionals etc Organization Chart Defines hierarchy chain of command channels of communication etc Issues involved with structuring organizations Centralized vs Decentralized authority can be focused at the top levels or it can be delegated to lower level staff Span of Control higher levels of organization control smaller groups of people Tall vs Flat flat organizations have few layers of management whereas talk organizations have a pyramid shape Departmentalization organizational functions separate into separate units which can offer productivity gains but also create internal issues that are hard to solve Organization Models an organization is structured into one of the following forms Line Organizations direct two way top to bottom lines of responsibility and communication limited or no specialized support staff Matrix Organization counters weaknesses in organizations establishing connections between divisions to help create enterprise synergies or heartaches Cross functional self managed teams self directed work groups teams made up of staff from different departments fading barriers and becoming effective Organizational Change the most successful businesses modify their organizational structure in response to circumstances Restructuring basic periodic redesign of the organizational model Reengineering complete radical redesign with dramatic improvements as the goal Organizational culture shared values that provide unity in the pursuit of enterprise goals positive supportive cultures can have a BIG impact on all aspects of business especially productivity Linking external organizations Extensive information systems capabilities make it much easier to swap data for sales order status quantities on hand etc With cheaper bandwidth and storage many businesses have been attempting transparency between organizations Fears of corporate espionage lost misinterpreted data etc make many business Managing every business activity across all business disciplines from supplier to executives wary Supply Chain Management customer in a way that Doesn t cause corporate difficulties or disconnects Saves money Doesn t anger customers Supply Chain Management and Logistics Defined Logistics management of the flow of goods or materials from point of origin to point of consumption while conforming to customer requirements Promotes economic development and specialization in effect increasing the variety of goods Inbound Logistics All inbound activities revolve around materials management Primary functions include Anticipating materials requirements Sourcing and obtaining materials Introducing materials into organization Monitoring the status of materials as a current asset Materials management objectives include Low costs Quality assurance Low level of tied up capital High level of service Support of other enterprise functions Materials are up over 50 of total costs usually much higher than wages and Reducing inbound costs by 10 is the equivalent of increasing sales by 68 or benefits reducing labor costs by 36 Purchasing Procurement Describes the activities associated with the acquisition of materials including Purchasing of materials Quality management Vendor relationships and coordination with other departments Supplier development and relationship management has become more important as companies look to build deeper partnerships with vendors Interaction with other divisions has been a big challenge as information systems interconnectivity dominate supply chain management Internet based procurement has matured rapidly in the last 5 10 years Receiving and Quality Assurance Receiving physical receipt of the purchased materials when they show up at your Data obtained during the receiving process is vital to systems in divisions like finance accounting marketing international etc Quality assurance checks all inbound deliveries and samples materials to determine vendor compliance to specifications Just In Time Inventory and Materials Requirements Planning Since WW2 the biggest revolution in inbound supply chain has been JIT inventory facility control JIT was founded through the efforts if two key individuals W Edwards Deming and Taiichi Ohno formally the Vic president of the Toyota Motor Corporation In 1950 Deming gave a landmark series of lectures to roughly 80 of Japan s top business and industry leaders on the gospel of quality and efficiency Ohno built on Deming s philosophies and primarily developed the Toyota Production System TPS with JIT as one of the core concepts Toyota could not afford major investments JIT basics Materials are used until a pre arranged order point is reached Kanban The requirement is communicated back to procurement which places a short lead time Frequent small shipments arrive just in time to fill depleted materials the closer to Every part counts if there are just a few defective parts the entire line could shut order andon running out the better down Benefits of JIT include JIT poses difficult challenges in production scheduling supplier capabilities logistics network demand forecasting failures often lead to costly plant shutdowns To reduce JIT risk most businesses create intense partnerships with suppliers and implement complex Materials Requirements Planning MRP systems MRP systems analyze inbound logistics challenges consider such elements as Productivity improvements Decreased inventories Reduced manufacturing cycle times Much lower costs Materials Requirements Planning Production scheduling Inventory control and tracking Demand analysis and
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