Intro Management 3304 Chapter 1 1 22 14 Empire State Building What is Management William Lamb architect based most of his design on a simple pencil 60 000 tons of steel was brought in from steel mills in Pennsylvania Took 1 year and 45 days to complete Officially opened in May 1 1931 Getting things done through other people o Effectively and efficiently o You must be effective before you are efficient You wouldn t want to be doing the wrong thing efficiently Management Truths As a manager you no longer get paid for what you do Anytime something goes wrong by definition it is a management problem What do Managers do Plan Organize Lead Contol Henry Mintzberg Study Life of a Manager Long hours intense pace 1 2 Fragmentation brevity variety 3 More verbal than written communication Harvard Business School Study Interviewed thousands of young people just out of college and their expectations about management They returned for more questions after the first year Interviewees responses They were surprised how fast paced how many interruptions and how challenging it was 1 27 14 A manager at a grocery store is trying to figure out why an employee is not working as expected what form of management is associated with this problem A Controlling 3 Skills Required of a Manager 1 Technical 2 Conceptual 3 Human Commerce The exchange of goods and services Makes everyone s standard of living improve Adam Smith Professor of logic at the University of Glasgow Wrote The Wealth of Nations 1776 Division of Labor Invisible Hand everyone innately does what is best for them and is advantageous to them This is the best idea for society o Global outsourcing has an immediate negative impact The outsourcing causes people to lose their jobs and it hurts the community Overall global outsourcing could raise prices and also have a negative impact on the population as a whole o Ex car companies outsource parts to foreign countries making the cars more expensive decreasing your standard of living Product s value will always decrease after a certain amount of time due to Product Life Cycles o Market saturation o New products o Competition Over time the price of a product tends to decrease as well as variable costs Know when to stop offering a product Value is subjective always higher than price Increasing the distance between value and cost makes the product more popular to the buyer o Lower costs combined with higher value makes products sell better Productivity outputs divided by inputs o Doing things the right way efficiently with as little inputs as necessary Adam Smith Wrote The Wealth of Nations 1776 Invisible Hand Division of Labor o Increased productivity due to job specialization and reduced time required to change from one task to another o Low skill simple jobs easy to train and replace people Industrial Revolution Classical Approach Availability of machine power Expansion of rail roads The Classical Approaches to the Industrial Revolution o Scientific Management o General Administrative Theory Scientific Management Leaders Frederick W Taylor o Wrote The Principles of Scientific Management 1911 o One Best Way the most efficient way to complete a task o Soldering Frank and Lillian Gilbreth o Time and motion studies o Tested on their family o Helped detail how to complete jobs quickly and efficiently Henry Ford Henry Gantt o Increased productivity by using the assembly line o Increased worker wages to increase productivity and ultimately profit o Linked manager s bonus to their employees performance Managers received a reward when their employees excelled One best way to do a job Worker selection Workers should be matched to the job they re best suited for by the o Gantt Chart Principles of Scientific Management manager Training and incentives General Administrative Theory Leaders Max Weber o The Ideal Bureaucracy Impersonality Authority hierarchy Formal selection Rules and regulations The Humans Relations Approach The Great Depression The Quantitative Approach WWII Franklin Roosevelt s New Deal Elton Mayo o Western Electric Hawthorne Works in Chicago o The Hawthorne Effect Douglas McGregor o Wrote The Human Side of Enterprise 1960 o Theory X and Theory Y The use of mathematical tools to aid in decision making Total Quality Management o Employee involvement o Continuous improvement o Defect prevention vs detection o Use of statistical data The Business Environment External Internal Global External Environments Internal Environments Technology combination of skills information machines and equipment o How you go about doing something Organizational culture Shared set expectations and norms that influence how members of a group behave Mix of rituals values traditions that define a group o Case example Nordstrom Strong Culture deeply held and widely shared How is an Organizational culture created and maintained o Company founder vision o Selection o Managers promote values and norms o Organizational socialization o Stories and heroes stories about the past o Rites of passage of enhancement everyone starts on the sales floor rite of enhancement is a formal ceremony that reinforces the behavior the company values o Can a culture change Yes but it is very difficult scorched earth approach starting completely over Lose all the bad but also all the good Not the desirable way to do it Power of conformity doing what everybody does is very powerful walk not talk A set of moral principles or values that defines right and wrong Ethics