Chapter 7 Management the process used to accomplish organizational goals through planning organizing leading and controlling people and other organizational resources Planning a management function that includes anticipating trends and determining the best strategies and tactics to achieve organizational goals and objectives Organizing a management function that includes designing the structure of the organization and creating conditions and systems in which everyone and everything works together to achieve the organization s goals and objectives Leading creating a vision for the organization and guiding training coaching and motivating others to work effectively to achieve the organization s goals and objectives Controlling a management function that involves establishing clear standards to determine whether or not an organization is progressing toward its goals and objectives rewarding people for doing a good job and taking corrective action if they are not Vision an encompassing explanation of why the organization exists and where it s trying to head Mission statement an outline of the fundamental purposes of an organization Goals the broad long term accomplishments an organization wishes to attain Objectives specific short term statements detailing how to achieve the organization s goals SWOT analysis a planning tool used to analyze an organization s strengths weaknesses opportunities and threats Strategic planning the process of determining the major goals of the organization and the policies and strategies for obtaining and using resources to achieve those goals Tactical planning the process of developing detailed short term statements about what is to be done who is to do it and how it is to be done Operational planning the process of setting work standards and schedules necessary to implement the company s tactical objectives Contingency planning the process of preparing alternative courses of action that may be used if the primary plans don t achieve the organization s objectives Decision making choosing among two or more alternatives Problem solving the process of solving the everyday problems that occur Problem solving is less formal than decision making and usually calls for quicker action Brainstorming coming up with as many solutions to a problem as possible in a short period of time with no censoring of ideas PMI listing all the pulses for a solution in one column all the minuses in another and the implications in a third column Organization chart a visual device that shows relationships among people and divides the organization s work it shows who reports to whom Top management highest level of management consisting of the president and other key company executives who develop strategic plans Middle management the level of management that includes general managers division managers and branch and plant managers who are responsible for tactical planning and controlling Supervisory management managers who are directly responsible for supervising workers and evaluating their daily performance Technical skills skills that involve the ability to perform tasks in a specific discipline or department Human relations skills skills that involve communication and motivation they enable managers to work through and with people Conceptual skills skills that involve the ability to picture the organization as a whole and the relationships among its various parts Staffing a management function that includes hiring motivating and retaining the best people available to accomplish the company s objectives Transparency the presentation of a company s facts and figures in a way that is clear and apparent to all stakeholders Autocratic leadership leadership style that involves making managerial decisions without consulting others Participative leadership leadership style that consists of manager and employees working together to make decisions Free rein leadership leadership style that involves managers setting objectives and employees being relatively free to do whatever it takes to accomplish those objectives Enabling giving workers the education and tools they need to make decisions Knowledge management finding the right information keeping the information in a readily accessible place and making the information known to everyone in the firm External customers dealers who buy products to sell to others and ultimate customers or end users who buy products for their own personal use Internal customers individuals and units within the firm that receive services from other individuals or units Chapter 8 Economies of scale the situation in which companies can reduce their production costs if they can purchase raw materials in bulk the average cost of goods goes down as production levels increase Hierarchy a system in which one person is at the top of the organization and there is a ranked or sequential ordering from the top down of managers who are responsible to that person Chain of command the line of authority that moves from the top of a hierarchy to the lowest level Bureaucracy an organization with many layers of manager who set rules and regulations and oversee all decisions Centralized authority an organization structure in which decision making authority is maintained at the top level of management Decentralized authority an organization structure in which decision making authority is delegated to lower level managers more familiar with local conditions than headquarters management could be Span of control the optimal number of subordinates a manager supervises or should supervise Tall organization structure an organizational structure in which the pyramidal organization chart would be quite tall because of the various levels of management Flat organization structure an organization structure that has few layers of management and a broad span of control Departmentalization the dividing of organizational functions into separate units Line organization an organization that has direct two way lines of responsibility authority and communication running from the top to the bottom of the organization with all people reporting to only one supervisor Line personnel employees who are part of the chain of command that is responsible for achieving organizational goals Staff personnel employees who advise and assist line personnel in meeting their goals Matrix organization an organization in which specialists from different parts of the organization are brought together to work on specific
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