PRINC OF MANAGEMENT
PRINC OF MANAGEMENT MGT 3200
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MANAGEMENT 3200 EXAM 1 STUDY GUIDE FROM THE NOTES amp ASSIGNED READINGS CHAPTER 1 INVITATION TO MANAGEMENT 1 N w 5 0 an N What is management Management is the process of achieving desired results through ef cient utilization of human and material resources What are the 2 key concerns of management Effectiveness and ef ciency are the 2 concerns What is effectiveness concerned with Efficiency Effectiveness is concerned with doing the right thing at the right time and in the right way goal attainment Ef ciency is concerned with reducing waste or minimizing resource costs since many resources are scarce getting more bang for your buck Effectiveness is concerned with the ENDS and ef ciency is concerned with the MEANS How are effectiveness and efficiency related They are related in that it s much easier to be effective if one disregards efficiency Conversely it becomes increasingly more difficult to be effective when one becomes more and more concerned with efficiency What is your important resource as a manager Human resources are your most important resources because the only way a manager gets things accomplished is through other people ls management art or science When is it considered a science An art Management is both an art and a science It is considered a science because they develop theories of managing test these theories empirically using the scienti c method and re ne reformulate or discard these theories based upon the results of these studies It is considered an art because there are many roads to managerial success or many widely different styles of management that can be successful for some managing comes natural to them based on their personalities How did management become important and why is it still significant today Management became important when the Industrial Revolution occurred and the transfer of skills from the craftsmen to the machines took place Managers were needed to supervise and coordinate these workers who had low skill level What was the basic change in the industrial revolution The basic change in the lnd Rev was the transfer of skills from the craftsmen to the machines What happened to productivity supply prices and demand as a result of the industrial revolution As a result of the large increase in productivity brought on by the addition of machinery and the division of labor to the transformation process prices dropped and demand grew 10 A N A w 14 A A an A N 18 5 What was the pivotal event of our time according to Drucker According to Drucker the switch from ownermanager to professional managers was the pivotal event of our time Why do most businesses fail Most businesses fail because of poor management What does a firstline manager do What are the names associated with 1 line management Firstline managers ensure that plans developed by top management are fulfilled by their operating employees and they are the only managers not to manage other managers The names associated with firstline managers are supervisor and foreman What does a middle level manager do What are the names associated with middle level manager Middle managers manage other managers and are most concerned with ef ciency There are two l s of middle management integrator and interpreter One of their duties is to integrate ie coordinate the activities of different work groups so they operate smoothly Secondly they act as interpreters and transform top management directives into rstline management What is corporate downsizing What happens in corporate downsizing What level of management is most adversely affected Corporate downsizing is when a company adopts a lean and mean philosophy When downsizing a company is trying to cut the fat by eliminating layers of management asking retained managersemployees to do more implementing new computer and information technologies and farming out what had been staff managerial activities such as legal counsel and training amp development ofemployees to outside consulting rms Middle managers are the most adversely affected What does a top manager do What are the names associated with top management Top managers determine the form ofthe organization and de ne its overall character mission and directions they set the strategy for the organization their goals are speci c and concrete and they also need to have more effectiveness orientation Names are CEO chairman ofthe board executive vicepresident etc What is the difference between a line manager and a staff manager Line managers are directly responsible for the work activities that contribute to the process of creating the organization s basic product or service they have authority over the transformation process where inputs are transformed into outputs and can be middle or top managers Staff managers use their special expertise to support the efforts of line managers they have no authority over the transformational process and for the most part are middle level managers What is the difference between a functional manager and a general manager Functional managers have responsibility for a single area of activity most managers are functional managers General managers are responsible for more complex and organizational subunits What is the difference between an administrator and a manager Administrators are managers who work in public or nonpro t organizations as opposed to private for pro t business concerns 19What are the five functions of management Be able to identify and describe the five functions of management There are ve functions of management planning organizing staffing and human resource management leading and interpersonal influence and controlling Planning involves goal setting and action planning Organizing is the process of designing an organization s structure to achieve its goals including what tasks are to be done who is to do them how the tasks are to be grouped into jobs etc Staf ng and human resource management is the process of assuring competent employees are selected developed and rewarded to help accomplish organizational goals including recruiting new employees selecting the best employee for a position providing training compensating employees fortheir work etc Leading and interpersonal in uence is the process of getting people to go along with you willingly and harmoniously in achieving your organization s objectives including motivating employees directing others resolving con icts etc Controlling aka feedback is the process of assuring the efficient accomplishment of organizational objectives feedback is informational tells you what you re doing is right or wrong and motivational 20What does quotplanning has primacyquot mean Planning has primacy means that planning is the rst thing a manager does because it is important ifyou are going to be successful 21What are the three aspects of controlling The three aspects of controlling are monitoring organizational performance comparing actual performance with hoped for performance comes from planning and taking corrective action in one or more ofthe functions if actual results fall short of hoped for results 22What are the siamese twins of management The Siamese twins of management are planning and controlling For performance to improve both ofthese have to be present 23What is are the most important functions for a 1 line manager Middle manager Top manager The most imp functions 15tline managers 9staf ng and leading middle managers 9organizing and top managers 9 planning 24What are three managerial roles Mintzberg identified Be able to identify each role Mintzberg identi ed three managerial roles interpersonal informational and decisional Interpersonal 9 develop and maintain positive relationships with others informational 9 receive info give info and analyze info decisional 9 use info to solve problems or take advantage of opportunities 25What gives rise to the three managerial roles according to Mintzberg According to Mintzberg all managers have authority over their organizational subunits and this status causes managers to be involved in interpersonal relationships with subordinates etc who provide them with info they need to make decisions 26What are three managerial skills identified by Katz Be able to identify each skill Katz identified three managerial roles technical human and conceptual Technical 9 ability to use a special expertise to a method in performing a task ex engineering accounting human 9 ability to work well in cooperation with others and conceptual 9 ability to problem solve forecast events see the big picture gestalt thinking intuition 27 N W N 0 w M At what level of management are conceptual skills most important Technical skills Human skills Technical 9 1Stline managers and top managers some skills human 9 all levels conceptual 9 higher levels as you ascend the management pyramid What skill is most difficult to develop Why Conceptual skills are the most dif cult to develop because they require a minimum level of mental ability ie reasonably intelligent and timeexperience to develop According to Luthans 1988 are effective managers successful managers in general In general effective managers are not successful managers What percent of effective managers are successful Less than 10 of effective managers are successful On what activity do effective managers spend the majority of their time Successful managers Effective managers spend the majority oftheir time on communication and successful managers spend the majority oftheir time on networking What is the primary difference between derailed executives and executives who made it to top management according to the Center for Creative Leadership The primary difference between derailed executives and executives who made it to top management is that the derailed executives were insensitive to others only way you get ahead is through other people CHAPTER 3 ENVIRONMENT OF MANAGEMENT 33 What are the three basic characteristics of an open system Three basic characteristics of an open system are input transformation and output 34What is the cyclical nature of the nature transformation process Negative entropy 0 UI Buffering the technical core Role differentiation and specialization Synergy Equifinality Cyclical nature of the transformation process 9 transformation activities produce outputs that will become new sources for inputs provides a feedback loop negative entropy 9 ability of open systems to bring in new energy to arrest or delay this decaying process buffering the technical core 9 controlling or neutralizing threatening external forces for change role differentiation and specialization 9 org develop specialized units to deal with particularly troublesome or challenging parts of the environment synergy 9 org should be able to achieve its goals more effectively and ef ciently than would be possible ifthe parts operated separately doesn t always work equi nality 9 reach the same end by different means emphasizes the exibility and adaptability of organizations What are the five subsystems of an organization What functions do each subsystem perform The ve subsystems of an organization are production boundaryspanning adaptive maintenance and management Production 9 want stability produces the product and service outputs ofthe organization internally oriented boundaryspanning 9 deal w suppliers and customers acquire needed supplies amp materials while creating amp delivering outputs adaptive 9 responsible for org change creating innovations amp for helping the org change and adapt ex RampD group implement new tech by making it better concerned w effectiveness maintenance 9 smooth operation amp upkeep of the org make sure employees are satis ed ex human resources psychological maintenance cafeteria employees janitors concerned w efficiency and management 9 provides direction strategy goals and policies for the entire organization resolves con icts bw departments legitimize org to society EXTERNAL 9 EFFECTIVENESS 9 PLANNING INTERNAL 9 EFFICIENCY 9 ORGANIZING 36What are the two major dependencies in the external environment What is the threat to these 2 major dependencies Two major dependencies in the external environment are directaction components customers suppliers competitors and indirectaction components technology 37How do customers influence organizations and how do organizations influence customers Customers in uence org by trying to force down prices obtain more or higherquality products and increase competition among sellers by playing one against the other Organizations in uence customers by advertising and market research to meet the needs of their customers 38How much more does it cost to find a new customer than to keep an old one according to Total Quality Management estimates It cost five times as much to find a new customer than to keep an old one 39How do suppliers influence organizations and how do organizations influence suppliers ie 3 ways to establish and maintain a positive relationship with suppliers Suppliers in uence org bc every org requires inputs from the env in the form ofraw materials services energy equipment labor and funds to produce outputs Organizations in uence suppliers in a number of ways vertical integration 9 buy your supplier increases competition long term contracts 9look in the supply at a low rate and reducing the of suppliers 9 allow suppler to achieve economies of scale and the opportunity to automate making them more ef cient and allows them to reduce costs 5 C What is the law of the marketplace The law of the marketplace states that companies that can t compete will have to change their product line or be eliminated 5 What are the five forces of competition and how does each influence the level of competition within an industry The 5 forces of competition are rivalry among org threat of new entrants threat of substitutes power of the suppliers and power ofthe customer Rivalry among org 9 jockeying for a new position competition is highest in mature low growth markets threat of new entrants 9 reduce profitability and increase competition the threat depends upon the barriers to entry into a market and they may have dif culty getting their productservice to customers threat of substitutes 9 increase competition and promote product obsolescence most of the time one can battle a sub initially w lower prices amp aggressive advertising power of the suppliers 9 can reduce an org pro ts don t have just 1 supplier have 2 or 3 and power of the customer 9 can demand higher quality lower prices or more services play competitors off one another 42What are the barriers to entry into an industry The barriers to entry into an industry are gov t policy capital requirements brand identification cost disadvantages and distribution channels 43What happens when a new entrant comes into the marketindustry When new entrants come into the market they increase competition which drives down prices and makes other established entrants improve quality and service 44What determines if a supplier is powerful Customer A supplier is powerful if they buyer has few other resources of supply or ifthe supplier has many other buyers The customer is powerful if they make large purchases or ifthey can easily nd alternative places to buy 45How do powerful suppliers and customers influence organizations Powerful suppliers and customers influence organizations by cutting into pro tability 46How do substitutes affect an industry Substitutes affect an industry by increasing competition and promoting product obsolescence 47What are process and product innovations What is the focus of each Process innovation is an innovation made in the technology used in transforming inputs into goods and services assembly line computer automation amp robotics Product innovation is an innovation made in the basic good or service an organization provides MP3 players high def TVs light beer amp arena football 48What are the general effects of technology on an industry The general effects of technology on an industry are product obsolescence and increased competition 49How does the economy influence an organization The economy in uences an organization by posing both opportunities and problems It is unpredictable and managers must continually monitor changes in economic factors in order to minimize threats and capitalize on opportunities 50What are the four ways that government influences organizations Four ways that gov t influences organizations are gov t regulations purpose is to improve the quality of life subsidization help businesses survive corporate welfare and taxation encourage or discourage businesses gov t competition gov t owned enterprises compete w private and gov t economic policies affect org s ability to thrive and prosper Say s law supply creates its own demand 51What is the shadow bureaucracy Shadow bureaucracy is federal agencies that make sure the organization is complying with laws and regulations governing the dept s activities 52What are the three ways organizations influence government Three ways org influence gov t are lobbying direct political action voting PACs and illegal action bribes kickbacks and blackmail 53What is a PAC What are the limits regarding PAC contributions to campaigns A PAC is a political action committee to help elect candidates PACs are restricted to giving 5000 to a candidate for each election race However there are no restrictions on how much a PAC can spend independently to help elect or defeat a candidate soft money 54How does society influence business Business influence society Society influences business by demanding changes like having more social responsibility and the environmental movement green washing Business in uences society through philanthropy support of charity drives and fundraising community service ads etc 9 help legitimize the org to its society 55How does the international component of the environment influence organizations The international component of the environment in uences org because other countries have different cultures so we must be aware of all aspects customers suppliers competitors technology economy gov t and culture 56What is environmental scanning How is it related to planning and organizational performance Environmental scanning is the process of monitoring and evaluating changes and trends in the environment It is related to planning and org performance bc org that gather a great deal of environmental info tend to perform better than org who gather comparatively little env info CHAPTER 5 PLANNING 57What are the three purposes of planning Three purposes of planning establish and help achieve organizational objectives protective or defensive offset future uncertainties by reducing the risk surrounding org s operations and af rmative or offensive seeking out and taking advantage of opportunities to increase org success 58Why is planning important Planning is important bc it helps an org succeed provides a sense of unity and direction helps managers anticipate and prepare for possible future changes helps develop performance standards and provides a basis for managerial development 59Why do managers resist planning Managers resist planning bc it is time consuming hard work involves high levels of intellectual ability used to measure results expensive lack of immediate feedback involves change fear of failure not rewarded by organization and it goes against the deer mentality 60What is Gresham39s law of planning Gresham s law of planning is the tendency for routine repetitive problems to overshadow planning problems 61What does the nonplanner typically blame for hisher poor performance Nonplanners typically blame their misfortunes on bad luck 62What are the five phases of the planning process and what happens at each phase The ve phases ofthe planning process are 1 establishing objectives nd out what you need to fix 2 developing premises 3 decision making 4 implementing a course of action and 5 evaluating results 63What provides the basis for Phase 1 Establishing Objectives 64What are SMART goals 65What is contingency planning What are the benefits and drawbacks 66What are the keys to effective implementation of a plan 67What function of management is Phase 5 Evaluating Results 68What is the basic dilemma in planning 69What are the different failures to avoid in planning Be able to identify 70What is the crystal ball syndrome Cureall syndrome Persian messenger syndrome CHAPTER 6 STRATEGIC PLANNING 71What is the focus of strategic planning 72What are the four components of a wellthought out strategy Be able to identify 73What is corporate strategy and business level strategy 74What are the four elements of strategy formulation and what does each element consist of 75What are benefits of a mission statement 76What is a SWOT analysis 77What is the goal of the Business Portfolio Matrix Approach 78What levels of strategy does the Business Portfolio Matrix Approach deal with 79How are SBUs classified in the Business Portfolio Matrix Approach 80What business strategy is used for a cash cow Star Dog New Venture 81What is the basic idea behind Generic Strategies 82What are the three Generic Strategies identified by Porter Be able to identify 83What is the basic idea behind the Adaptation model of strategy 9 84What is a defender Prospector Analyzer Reactor When is a defender strategy the best Prospector Analyzer Reactor 85How does each strategy type in the Adaptation Model answer the entrepreneurial engineering and administrative questions 86How are the strategies in the Business Portfolio Matrix Approach and the Adaptation Model of Strategy related to one another ASSIGNED OUTSIDE READINGS 87What does the article When competitive advantage is neither say about competitive benchmarking as a strategy 88What does the article Avoid pricing yourself short say about competing on price as a strategy for attracting customers 89 Questions from the Business Week article What s in a Phrase A What did Emergence s second annual slogan study reveal B What s the simple lesson regarding slogans C What are the three rules in sloganmaking WM 1 Chapter ll Invitation To Management 1 Equot 5 UI 0 l 00 9 What is management The process of achieving desired results through the efficient use of human amp material resources amp through the utilization of effectiveness amp efficiency What are the 2 key concerns of management Effectiveness amp Efficiency What is effectiveness concerned with ef ciency Effectiveness is concerned with doing the right thing in the right time in the right way goal attainment Efficiency is concerned with reducing waste or minimizing resource costs since many resources are scarce Getting more bang for the buck How are effectiveness amp ef ciency related More concerned with efficiency the harder it is to be effective ie when you try too hard to cut costs you can loose sight ofyour goals Effective companies tend to be efficient What is your important resource as manager Human resources people Injellitance incompetence jealousy is a big threat Is management art or science When is it considered a science an art Both It is a science bc we develop theories of managing amp then test them using the scientific method w empirical evidence It is an art bc it s an extension ofpeople s personalities it can not all be taught amp there are many different management styles that can be successful How did management become important amp why is it still signi cant today Industrial Revolution changed how work was performed dividing up labor causes a need for managers Owners used to do all of the managing Craftsman didn t need managers bc could manage themselves but machine need coordination What was the basic change in the industrial revolution Skilled craftsman use of machinery amp division of labor skilled labor decreased What happened to productivity supply prices amp demand as a result of the industrial revolution Production increased prices decreased demand increased 10 What was the pivotal event of our time according to Drucker The switch from ownermanager to professional manager 11 Why do most businesses fail Poor management 12 What does a rst line manager do What are the names associated with ISt line management Ensures that the plans developed by top managers amp middle managers are implemented by laborers w minimum costs Foreman supervisor 13 What does a middle level manager do What are the names associated with middle level manager Taking the plans from top level management amp put them into action for lst line management integrate amp interpret these plans Plant manager department head division head 14 What is corporate downsizing What happens in corporate downsizing What level of management is most adversely affected Cutting costs Cut the fat by reducing costs by ppl Efficiency oriented Often done by eliminating middle management levels staff management is farmed off to consulting firms amp everyone else that remains does more work technologyamp computers help for faster communications but often those people left have survivors syndrome where they become stressed overworked amp think they are the next to leave since their friend s were just fired amp as a result their productivity decreases 15 What does a top manager do What are the names associated with top management Plan amp legitimize for the organization CEO CFO CIO chairman of the board executive Vice president 16 What is the difference between a line manager amp a staff manager m power over production have al the power amp exists at all levels of the production pyramid mu gives support amp guidanceadvice most often middle managers 17 What is the difference between a functional manager amp a general manager Functional specializesmanages 1 area lStline managers usually General manages many areas a jack of all trades amp a master of none increase as you go up the pyramid 18 What is the difference between an administrator amp a manager Administrator Nonprofit companies Manage for pro t companies 19 What are the 5 functions of management Be able to identify amp describe the ve functions of management POSLC aPlanning Setting goals amp steps necessary to get there b Organizing dividing up work amp making sure they work together c Staffing recruiting ampselecting employees d Leading motivate communicate resolve con icts e Controlling give feedback 20 What does planning has primacy mean First thing you must do Gives directions to all of the other functions 21 What are the three aspects of controlling a Monitor performance b Compare actual results w hoped for results for feedback on performance c Taking corrective action if actual lt hoped for 22 What are the Siamese twins of management Planning amp Controlling 23 What is are the most important functions for a Isl line manager Middle managerTop manager litIii staffing amp leading Middle organizing m planning 24 What are the three managerial roles Mintzberg identi ed Be able to identify each role Interpersonal to develop amp maintain positive relationships w others Informational receive information amp then analyze it Decisional using information to solve problems or to take advantage of opportunities 25 What gives rise to the three managerial roles according to Mintzberg A manager s authority gives rise to status 26 What are the three managerial skills identified by Katz Be able to identify each skill Technical knowledge expertise method Human ability to work well w others communication leadership empathy selfawareness Conceptual ability to problem solve see the big picture forecast 27 At what level of management are conceptual skills most important Technical skillsHuman skills Conceptual top managers b c they have to plan Technical 1St line most important Human equally important at all levels 28 What skill is most dif cult to develop Why Conceptual skills bc you need to be smart have experience amp it takes time to develop this skill 29 According to Luthans 1988 are effective managers successful managers in general NO effective managers were not usually promoted rapidly through the organization the ones that networked were the ones who moved up 30 What percent of effective managers are successful 0 31 On what activity do effective managers spend the majority of their time Successful managers Effective manage down communication Successful networking not what you know but who you know they manage up 32 What is the primary difference between derailed executives amp executives who made it to top management according to the Center for Creative Leadership Derailed executives are insensitive to other ppl CHAPTER 2 ENVIRONMENT OF MANAGEMENT 33 What are the three basic characteristics of an open system m raw materials from suppliers Transformation production of goods Output finished goods amp services 34 What is the cyclical nature of the transformation process Negative entropy Buffering the technical coreRole differentiation amp specialization SynergyEquifmality Cyclical nature of the transformation process customers amp suppliers are most important Negative entropy trying to prevent the company from dying Buffering the technical core stability in production Role differentiation amp specialization as open systems grow amp develop organizations needs more specialized departments Synergy teamwork whole better than sum of its parts 225 Eguifinality many roads to success 35 What are the ve subsystems of an organization What functions do each subsystem perform a Production transform raw materials to goods amp services inputoutput b Bounda spanning buying from suppliers selling to consumers c Adaptive research amp development d Maintenance smooth operation amp upkeep of organization Facility Services LSU e Managerial top amp middle management plans amplegitimizes is top middle organizes 36 What are the two major dependencies in the external environment What is the threat to these 2 major dependencies Customers amp Suppliers Their biggest threat is competition 37 How do customers in uence organizations amp how do organizations in uence customers Customers can cut into your pro tability can demand lower pricesbetter quality Organizations in uence customers by advertising ampcreating the need 38 How much more does it cost to find a new customer than to keep an old one according to Total Quality Management estimates 5 times 39 How do suppliers in uence organizations amp how do organizations in uence suppliers ie 3 ways to establish amp maintain a positive relationship with suppliers Vertical integration buy your supplier Long term contract lock in the supplier a lower price Reducing the number of suppliers the larger volume makes a cost reduction 40 What is the law of the marketplace Organizations that can t compete will be forced to change their product line or will die out 41 What are the ve forces of competition amp how does each in uence the level of competition within an industry a Rivalry among organization greatest mature low growth b Threat of new entrants new entrants steal market share amp drive prices down higher the market threat higher the competition c Threat of substitutes can affect what prices you can charge amp due to technological innovation can make older products obsolete 4 N 4 M 4 5 4 UI 46 47 48 49 d Power of customers powerful customers can cut into pro tability customers who make large purchases can drive down prices e Power of suppliers can raise prices or reduce quality of good What are the barriers to entry into an industry Government regulations patents which keep competition out Capital requirements High startup costs Brand loyalty to established companies Cost advantages to existing customers who buy in large quantities Distribution channels tied up amp hard to break in What happens when a new entrant comes into the marketindustry Increase competition increase product supply prices lower amp they seek market share What determines if a supplier is powerful Customer Suppliers are powerful if there are few places to buy or if heshe has many customers Customers are powerful if they make large purchases or if they can easily nd alternative places to buy How do powerful suppliers amp customers in uence organizations They can either drive prices up or down amp can cut into the organizations pro tability You don t want to depend on powerful customers amp suppliers How do substitutes affect an industry Increase competition increase power of the customer amp can make products obsolete Technological innovations often substitutes are at a higher price when they come out What are process amp product innovations What is the focus of each Process advancement made in technological aspect more ef cient assembly line Product an innovation dealing w a product good or service more effective light beer What are the general effects of technology on an industry Increases competition promotes product obsolescence you have to change your product line to meet new changes in technology or risk dying out How does the economy in uence an organization Indirectly by expanding economy which raises demand amp vice versa Facilitates the establishment of new enterprises Almost always unpredictable Managers prefer stable economic conditions with moderate steady growth b c violent changes in economic conditions can restrict business investment amp growth 50 What are the four ways that government in uences organizations Regulations improve quality of life Taxationsubsidies encouragediscourage businesses Direct competition post office vs UPS Economic policy affect ability to thrive amp prosper 51 What is the shadow bureaucracy For every department in an organization there s a federal agency governing it making sure you are following regulations HR Department of Labor 52 What are the three ways organizations in uence governments Lobbying direct political action illegal activity 53 What is a PAC What are the limits regarding PAC contributions to campaigns Political Action Committee formed by employees amp stockholders to lobby gov t Limited to direct contributions of 5000 but they can give soft money indirect contributions indefinite 54 How does society in uence business Businesses in uence society Society in uences business through changes in social opinions cleaner environment women in the workplace Businesses in uence society through charity amp philanthropy as well as trying to legitimize their business to society 55 How does the international component of the environment in uence organizations It is both a threat amp an opportunity ie more products competing is threat but outsourcingamp more people to buy is opportunity 56 What is environmental scanning How is it related to planning amp organizational performance Monitor changes amp trends in the environment Allows you to decide what goods or services to emphasize amp which markets to eXploreamp technologies to exploit CHAPTER 4 PLANNING 57 What are the three purposes of planning a Establish amp help achieve organizational objectives fundamental b Offset future uncertainties by reducing the risk surrounding organizational operations defensive c Affirmative o ensive seeking out amp taking advantage of opportunities to increase organizational success 58 Why is planning important Organizational success helps you succeed but doesn t guarantee it Sense of unity amp devotion Coping with change take wrong problems lstamp so forth Performance standards Managerial development develops managerial talent 59 Why do managers resist planning Hard work amp they are afraid of failure Resists bc not rewarded by the organization Lack of immediate feedback Involves change Goes against the doer mentality 60 What is Gresham s law of planning Even when managers have the best intentions of planning they end up neglecting it bc they end up dealing w more recent problems have wrong priorities 61 What does the non planner typically blame for hisher poor performance Bad luck external locus of control 62 What are the ve phases of the planning process amp what happens at each phase a Establishing Objectives what do you want to do b Developing Premises what factors are going to affect goal achievement c Decision Making select best course of action to accomplish objectives d Implementing A Course Of Action assign amp direct personnel to carry out the plan e Evaluating Results compare actual results w hoped for results 63 What provides the basis for Phase 1 Establishing Objectives Your environmental scans avoid threats amp exploit opportunities 64 What are SMART g0als0r SMAIT S specific M measurable for feedback A achievable yet challenging R relevant I important T trackable 65 What is contingency planning What are the bene ts amp drawbacks Developing multiple future scenarios amp the plans to accompany each scenario using a what if a dynamic environment Bene t allows you to act rather than react Drawback requires more time amp resources than normal planning 66 What are the keys to effective implementation of a plan Tied to the budgetary system make sure you have the resources to carry out A clearly communicative plan what amp why Motivate employees 67 What function of management is Phase 5 Evaluation Results Monitor performance actual vs hoped for results 68 What is the basic dilemma in planning Commitment increases but willingness to plan amp exibility decreases 69 What are the different failures to avoid in planning Be able to identify Top down delegation is not good bc leaves key line managers out of the process Not supportive environment time training money resources rewards Plans that are too rigid of complex KISMIF keep it simple make it fun Failure to manage your plan Unrealistic expectations Getting bogged down in the details of planning 70 What is the crystal ball syndrome Cure all syndromePersian messenger syndrome Crystal Ball believing that planning is solely about predicting the future neglects implementation amp evaluation CureAll planning should cure all problems WRONG Persian Messenger kill the messenger neglects evaluating results bc no feedback when you punish the person who brings the bad news instead you should reward this person for their fair evaluation bc it helps keep the plan in line CHAPTER 5 STRATEEIC PLANNINE 71 What is the focus of strategic planning Establish amp maintain a positive longterm relationship w the external environment 72 What are the four components of a well thought out strategy Be able to identify a Scop decide where the organization is going to compete which range of markets do you want to do business in b Resource Deploymen how to spend your resources to achieve the goals cash cows for new ventures c Distinctive Competence competitive advantage strength sets you off from competition what is the company good at d Synergy different aspects of the company compliment each other 225 73 What is corporate strategy amp business level strategy Corporate what businesses you want to own increases market share amp pro tability l strategy Business how you plan on competing w each business multiple strategies 74 What are the four elements of strategy formulation amp what does each element consist of OMIT 75 What are bene ts of the mission statement OMIT 7 9 What is a SWOT analysis OMIT 7 I What is the goal of the Business Portfolio Matrix Approach Own that mix of businesses that will maximize market share amp pro tability 7 00 What levels of strategy does the Business Portfolio Matrix Approach deal with Both corporate amp business level 7 0 How are SBUs classi ed in the Business Portfolio Matrix Approach Based on market share xaxis amp market growth yaxis amp therefore will determine how we deal w them Strategic Business Units businesses we own 80 What business strategy is used for a cash cow StarD0gNew venture Cash Cow HI market share amp LO growth makes huge pro ts invest minimum amount needed to keep market share HI market share amp LO growth invest all your to grow market share before it matures mg LO market share amp LO growth keep them if they re pro table but as soon as they start to loose money get rid of them New Venture LO market share amp HI growth if you think it could become a star invest heavily if not get rid of it 81 What is the basic idea behind Generic Strategies There are 3 basic strategies that can be applied to a variety of industries 82 What are the three Generic Strategies identi ed by Porter Be able to identify a Differentiation make an image that your product is different than all others so you can demand a high price ie Rolex or Mercedes b Cost Leadership increase sales by minimizing the cost per unit amp your prices Walmart c Focus concentrate your efforts on a speci c audience Lady Foot Locker 83 What is the basic idea behind the Adaptation model of strategy Strategy must be aligned w it s environment for it to be effective 84 What is a defender ProspectorAnalyzerReactor When is a defender strategy the best ProspectorAnalyzerReactor Defender demand products not growing cash cows stable environment effective production lots of rules amp regulations fastfood restaurants Prospector demand growing expansion new venture or star develop innovate few rules amp regulations creativity Analyzer environment moderately changing Reactor worst strategy reacts to environment no set strategy no set production process or organization design inefficientKMa1t Defender amp Prospector are complete opposites 85 How does each strategy type in the Adaptation Model answer the entrepreneurial engineeringamp administrating questions OMIT 86 How are the strategies in the Business Portfolio Matrix Approach amp the Adaptation Model of Strategy related to one another Defender cash cow Prospector new venture amp star Analyzer cash cow new venture amp star Reactor dog not all dogs are reactors ASSIGNED OUTSIDE READINGS 87 What does the article When competitive advantage is neither say about competitive benchmarking as a strategy Focusing so much on beating the competition can cause you to lose customers Try amp find innovative ways to serve your customer 88 What does the article Avoid pricing yourself shot say about competing on price as a strategy for attracting customers Try amp develop a better relationships w your customers amp when just have cheap prices your product is no longer valued You should differentiate your product instead amp provide great service Impossible to compete on quality service amp price choose 23 89 Questions from the Business Week article What s in a Phrase A What did Emergence s second annual slogan study reveal Fewer than 12 of slogans were known by 5 of respondents amp 15 of them were recognized by 1 or fewer Consumers only remember a very small fraction of all slogans out there B What s the simple lesson regarding slogans Don t focus too much on bc may neglect truly important aspects of the business Consumers don t pay that much attention to them anyway 0 What are the three rules in slogan making 1 Don t advertise your aspirations We love to see you smile makes you think I m sure they don t care if you re happy or not 2 Give your slogan time to develop don t change it often 3 Consider not using a slogan all REVIEW QUESTIONS FROM CLASS a 1st line managers are responsible for Implementing plans thru operative employees laborers b Corporate downsizing Staffjobs are the 1st to be eliminated c Why do business fail Poor management d Southwest Airlines When market share increases while the same times its cost relative to its competitors are low SW is effective amp efficient e The CEO of Syngeta Inc is a Top manager General manager Line manager makes decisions about what s produced amp when produced f Injellitance most adversely affects which function of management Staffing or leading g A manager is conducting an annual performance appraisal with 1 of her employees This is an example of the Controlling function measuring their performance relative to what you hoped for h What is the leading function of management Communicating Motivating Resolving con ict i What is empathy Being able to put yourself in someone else s shoes amp try to see the world from their point of view j What is self awareness Knowing how you re behaving amp how it affects others k Which is more imp01tant to the success of a businessCustomers or suppliers Both are equally important 1 What did Luthan s study show Promotions were not based on performance m What is entropy The tendency for s system to decay over time 11 Successful managers spent most of their time on Networking bootlegging brown nosing o Suppliersamp customers are equally imp01tant to a company s success during Cyclical nature of the transformation process p Which subsystems focused on external environments Boundaryspanning Adaptive Managerial 12 amp 12 top is external amp middle is internal Maintenance is all internal q Environmental scanning is most closely associated with Planning r Buffer the technical core refers to Production s Which subsystem deals with an organizations 2 major dependencies Boundaryspanning t A managerial subsystem contains management Both middle amp top V How do you know if a supplier is powerful or not They re one of the few sources of the supply amp they have many customers w What subsystem of the organization deals primarily with technological change Adaptive x What do you want in your business portfolio New ventures stars amp cash cows primarily amp an occasional pro table dog QUESTIONS FROM THE BOOK Chagter 2 90 What are the internal strategies for dealing with environmental uncertainty Changing domain recruiting buffering smoothing rationing 91 What is involved in changing domain as a way to deal with environmental uncertainty Deciding where your organization will do business amp what they will produce amp market If uncertainty managed by moving to a more accommodating environment 92 How does recruiting help an organization cope with environmental uncertainty Hire top employees from a major competitor 9 W What is input buffering output buffering m manager s interruptions of supply shocks by maintaining a stockpile of materials or by purchasing in housing the supplier itself Output maintains uniformity of nished goods by warehousing them until they can be absorbed always able to meet the demands 94 What is smoothing Maintaining continuous demand of a product or service 9 UI How does pricing in uence smoothing Prices increases so en demand while price reductions decrease demand charge more peak hours amp discount off hours 96 What is rationing Ensure all time is productive restaurants using reservations 97 What are the external strategies for dealing with environmental uncertainty Advertising contracting coopting coalescing lobbying 98 What is contracting What are its bene ts Who benefits most Selling seasonal products ahead of time a xed rate through a mutually bene cial agreement Bene ts Customer bene ts bc they re guaranteed a price amp the seller bene ts bc he is guaranteed a customerbuyer Who bene ts most is determined by whether the set price is above or below the current market price at the time of the sale If they have gone up buyer pays less amp the buyer would bene t the most amp vice versa 99 What is co opting How does this affect the external party Attempts to in uence an external party by coopting them into the organization as part of some input device Allows the external party to have in uence over the product of company amp dissipates any resistance to the organization 100 Why is planning necessary Helps organizations to deal w complexity amp uncertainty by providing a road map for change WO planning organizations can only react to changes in the environment technology amp customer demands 101 What is cycle time reduction The length oftime to complete a process amp be ready to begin a new Gives companies a competitive advantage Chapter 4 102 What s the difference between strategic tactical amp operational planning Strategi general 5 years Tactical 25 years more speci c Operational lt2 years very focused speci c measurable steps 103 What is a single use plan standing plan Single have a clearly de ned time frame for their usefulness amp will become obsolete once the product is complete disappear Standing guide repetitive situations amp makes decision making faster easier amp more consistent ongoing 104 What is the plan do check act cycle Planning approach for continuous improvement planning the improvement doing it on a small batch checking for compliance w standards amp then implementing the tested process 105 What does concept to customer mean The time a product is rst considered to the time it s sold to the customer 106 What is cycle time reduction concerned with Reducing cycle times reducing the concept to customer time 107 What is the 3 rule as it relates to cycle time reduction Only 3 of the elapsed time for a process is actually needed to complete the activity ling an insurance claim may physically only take 5 minutes but processing it may take 30 days 108 What is reengineering The fundamental rethinking amp radical redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance such as cost quality service amp speed Cheater 5 109 What are the four building blocks of competitive advantage Quality innovativeness efficiency customer representatives 110 What is the bene t of concentrating on a single business as a corporate strategy Focusing all the corporate energies in one area 111 What is the downside of concentrating on a single business as a corporate strategy All companies strategic eggs are in one basket amp any economic downturn can immediately affect the company 112 What is unrelated diversi cation Related diversi cation Unrelated occurs when a business moves into an industry unrelated to its core business Hitachi makes consumer electronics power tools amp computers Related occurs when an organization diversifies into similar industries products andor infrastructures Del Monte owns a vegetable processing plant glass jar company amp a snack food company EXTRA CREDIT Some manager s suffer from injellitance incompetence jealousy you select people that are inferior to you not the best amp hide people who are better than them a manager might put an inferior person on an important job amp well qualified people on unimportant jobs because the good employees make the manager jealous so he she wants to cover up their feelings Management as practice has egui nality many roads to success Companies that downsize the employee s that remain go through a survivor syndrom it could happen to me depressionanxiety all of their friends were red over time their effectiveness decreases Emotional intelligence 1E1 manager s ability to manage his emotions amp the emotions of others to produce the best results for the company a human skill you can gain human skills by getting involved When you bring a problem to the boss it s called an upward leaping monkey A lot of people call subsidies corporate welfare government hands out the business Say s Law if you produce it they will buy it supply produces its own demand removes barriers of trade to keep competition down Going Green environmentally conscientiousfriendly very expensive to achieve Throttling reduce the amount of the number of DVD s you can rent NetFliX Pareto s Rule 80 of the results come from 20 of what you do amp you need to focus on those things Corporate Anorexia when a company gets too lean from downsizing amp employees burnout amp become unproductive Only 10 of effective managers are successful 3312010 122700 AM MANAGEMENT 3200 EXAM TWO OBJECTIVES FROM THE NOTES amp OUTSIDE READING DECISION MAKING 1 Is decisionmaking a function of management No POSLC most closely associated with planning 2 Why do we make decisions as managers o accomplish our goals efficiently 3 What s the difference between programmed and nonprogrammed decisions o Programmed Rule or SOP to make us more efficient o nonprogrammed novel unique and complex intro to technology 4 Do managers make more programmed or nonprogrammed decisions in general o Managers make more programmed decisions o nonprogrammed decisions are more often made by top management 5 What is decisionmaking under conditions of certainty o Know all alternatives and outcomes easiest 6 What is decisionmaking under conditions of risk o probabilities between 0 and 100 odds better be right most common 7 What is decisionmaking under conditions of uncertainty o know the alternatives but have no idea of outcomes most difficult decisions 8 Which decisionmaking condition is most common Least common Most difficult o Most common Risk o Least common certainty o Most difficult uncertainty 9 What is the key to making good decisions under risk o The oddsprobabilities need to be right 10 How do programmednonprogrammed decisions and the different decisionmaking conditions relate o Programmed made under certainty o nonprogrammed under uncertainty 0 risk can be either 11 What does the traditional economic model assume about decision makers 2 assumptions o Rational select the best possible alternativesolution every time prescripted model o Maximize 12 Under what decisionmaking condition do decisions get made in the traditional economic model o certainty 13 What does the behavioral model assume about decisionmakers o bounded rationality o satisfice select the first one that is good enough 14 What is bounded rationality What three things bound one s rationality o emotion o unforseability of future events o limited mental capacity 7 2 options 15 What is satisficing How does it differ from maximizing Is it irrational o satisfice select the first alternative that is good enough satisfactory o Maximize going through all the alternatives for the best one o rational given our limits as human beings 16 What is a heuristic What are the advantages of and disadvantages of heuristics o Mental shortcut we use in making a decision labor saving device Saves us time and effort produces more good decisions than bad ones Example satisficing o disadvantages use them so often we don t realize we are using them and rely on them can lead to errors judgments bias good thing gone bad 17 What is the availability heuristic What factors cause you to overestimate the frequency of an event Underestimate the frequency of an event o availability heuristic is used when managers assess the frequency of an event by the degree to which those instances of that event are easily recalled in memory o Emotional recall think it happens all the time anything that makes it stick out if its vivid specific you are going to think it happens more often then not 18 What is the representativeness heuristic What s the problem with this heuristic c We judge the likelihood of an event happening by matching it with a preexisting category or stereotype o Can miss individualopportunity 19 Under what decisionmaking conditions do decisions get made in the behavioral model o Risk and Uncertainty 20 What does the irrationalimplicit favorite model of decisionmaking say about decisionmaking o early on we pick a favorite look at other alternative not given a fair chance bias o what we want our emotion o Kerry s love model 21 What types of decisions are made irrationally o uncertainty non programmed decisions 22 What is the basic purpose of a brainstorming session o generate solutions to a problem 23 What are the four rules in brainstorming o no criticism o the weirder the idea the better freewheeling o quantity of quality o combination and improving ideas 24 Can inhibitions be totally eliminated in brainstorming sessions o no can totally eliminate evaluationcriticism 25 What two creativity techniques does synectics use in helping the group to generate better ideas o analogy wet leaves in Pringles o fantasy 26 What is the superhero technique o using the superhero s power to solve the problem no limits 27 In synectics what is the job of the facilitator Technical expert o Facilitator responsible for helping you become more creative o Technical expert helps you evaluatefacilitate those ideas 28 What s the problem with synectics o Technical experts will evaluate the feasibility 29 What research is Nominal Group Technique NGT based on o 5 individuals working alone generate more ideas then 5 working together get rid of the group process 30 How is NGT different from brainstorming and synectics o it does not rely on free association of ideas o it purposely restricts verbal interaction 31 What in NGT does one try to eliminate to improve the decisionmaking process o the group process and process losses 32 What are the steps in NGT 5 o everyone is familiarized with the problem o group members work silently and alone o group members share there ideas round robin o evaluate the ideas round robin o group members vote privately two votes are taken steps 2 and 5 when they come up with ideas and when they vote on ideas are Key to NGT 33 What are the defining characteristics of the Delphi technique o fancy NGT the members never meet and the member remain anonymous surveys 34 What is the reasoning behind the Delphi technique o eliminate the negative aspects of the group process but to a greater extent of NGT 35 What are some problems that can be encountered when using the Delphi technique o Poor design gets poor results o if it takes to long people between steps people lose interest or forget what they said 36 What is the stepladder technique o it is designed to prevent social lothing allows the group multiple chances to reconsider it s decision adding people to the group to challenge and rethink the idea o as a group they arrive at a decision o used when the decision has to be right the first time 37 What is the stepladder technique designed to prevent Promote o Prevent social othing everyone has to carry their weight and make a decision 38 What are operations research techniques What are they designed to do What kind of data do they usually require Are they an aid or substitute for managerial decisionmaking What do managers need to think critically about when they use these techniques Are they applicable to all decisions that managers make o techniques that help you evaluate the alternatives o designed to evaluate alternatives o kind of data quantitative data o they are used as an aid in managerial decisionmaking o Think critically about the data that goes into them numbers need to be right o Not applicable to all decisions used in risk the odds better be right cannot be used for uncertainty not needed for certainty 39 What is meant by the term confirmatory bias in decisionmaking c When we make a decision we look for positive information about our decision o If we look for negative information that tells us we made a bad decision why stereotypes are hard to overcome We look for information that confirms the stereotype and everything else is an exception 40 What is the gambler s fallacy o the next hand has got to be good 41 In making decisions do people pay more attention to descriptive qualitative information or statistical quantitative information o descriptive qualitative 42 In making decisions people often violate the law of large numbers What does that mean Why does it occur o ignore large samples of data and go with there own brief descriptive experience 43 How does the framing of a decision affect decisionmaking Positive framing Negative framing o Positive gain tend to be conservative o Negative loss tend to take more risk to make up for loss ASSIGNED OUTSIDE READING QUESTIONS 54454 44 What is group decision making a function of o individual contributions assembly effect process losses 45 What is an assembly effect process loss o Assembly effect An advantage of group decision making o Process loss disadvantage of group decision making 46 What is the optimal size for a decision making group o 5 or 7 breaks tie 47 What are the advantages of group decision making o Assembly effect 48 What are the disadvantages of group decision making o Process loss 49 What is the leveling effect c Compromise that takes place in group decision making lower the quality of the decision but at the same time increases the acceptance of the decision o both an assembly effect and a process loss 50 When does a manager under what conditions use individual decision making rather than group decision making o Little time o subordinates don t get along well in the group o knowledge or expertise of the manager o no need for group acceptance o don t share the goals of the organization 51 Rank the following in terms of decision making accuracy group average individual in the group and best member in the group o best member group then average individual 52 Which is more efficient group or individual decision making consider both short term and long term efficiency o individual takes less time short term efficiency o group long term efficiency 53 Where do you have greater creativity five individuals generating ideas alone or those same five individuals generating ideas as a group o 5 alone 54 Which leads to greater acceptance of the decision and better implementation of the decision individual or group decision making o group JOB DESIGN 55 What function of management is concerned with job design and organizational design o organizing dividing up work between individuals and groups and coordinating your efforts 56 What are the three aspects ofjob design 1 Task major duties 2 work methods and procedures 3 how is this job related to other jobs who you coordinate with 57 What is skill variety 58 59 60 6 H 62 63 64 65 o extent to which your job allows you to perform a wide range of task requiring a variety of skills 0 High craftsmen 0 Low assembly line What is task identity o do an entire or whole piece of work and clearly identify with the results of their effort 0 High craftsmen 0 Low assembly line What is task significance o extent to which the job and its performance exert a considerable impact on the lives of others o depends on how the individual sees the importance of his job What is autonomy o self rule how much freedom you have Giving orders Job Depth What is feedback o knowing how you are performing on yourjob 360 feedback can come from everywhere Self most important What is job breadth and job depth o Job breadth narrow to wide primarily skill variety and secondarily task identity range of task you perform on the job o job depth autonomy What task characteristics is job breadth similar to o primarily skill variety o secondarily task identity What task characteristic is job depth similar to o autonomy What job design is least prevalent today Most prevalent today o craft least prevalent o specialized most 66 What is a specialized job and how does it load on the five task characteristics o assembly line narrow in breadth and shallow depth o task low except for feedback 67 What are the advantages of specialized jobs o efficiency 68 What are the disadvantages of specialized jobs o Low satisfaction boring repetitive absentee and turnover withdrawal behavior 69 What is the purpose ofjob enlargement o increase breadth skill variety increases task identity Depth doesn t increased short lived 70 What two task characteristics does job enlargement increase o skill variety o task identity 71 The motivational benefits ofjob enlargement are shortlived or long lived short lived 72 What is job rotation o shifting workers through a set ofjobs in planned sequence 73 What is job enrichment How is it different from job enlargement o The work itself is motivational interesting meaningful challenging work to perform over which they have control o increases depth greater autonomy 74 What are the advantages ofjob enrichment o Motivation and satisfaction high o Absenteeism and turnover go down o Quality goes up and quantity goes down 75 What are the different aspects of the job characteristics model o don t worry about this problem 76 What are the three moderators that influence the effectiveness ofjob enrichment How do they influence it o knowledge and skill of the employee o growth need strength of the employee o context satisfaction 0 Reduced effectiveness marginal or weak skill levels 0 instrumental motivation o context dissatisfaction 77 What are the five steps in redesigning a job so it will be enriched What happens at each step and what task characteristics are increased 1 Form natural work units increases task identity 2 combining task job enlargement 3 establish client relationships contact with customers internal or external 4 vertical loading increase autonomy most important step 5 open feedback channels 78 What step in the redesign process is job enlargement o Combining task 79 What step in the redesign process is most important o Vertical loading 80 What are the disadvantages ofjob enrichment c not everyone wants an enriched job c not everyone is capable o cost goes up and efficiency comes down o supervisors don39t like the competition can be downsized o unions don t like it 81 How does strategy influence job design o defender specialize o prospector enriched craft 82 What employee factors should be taken into consideration when designing jobs o ability and motivation 83 What type of motivation is best suited to specialized jobs Enriched jobs o specialized instrumental work because you have to o enriched expressive works because they want to 84 What is instrumental motivation Expressive motivation o instrumental works because they have to o expressive works because you want to 85 What is the YerkesDodson law arousal and performance are related in what manner o relationship between arousal and performance inverted U 86 When someone is hypersensitive to their environment what type ofjob design should they be given Why o Little stimulation to create moderate level of arousal specialize 87 When someone is hyposensitive to their environment what type ofjob design should they be given Why o lot of stimulation to create a moderate level of arousal enriched 88 How does technology affect job redesign efforts o more technology involved in process the harder it is to redesign jobs 89 How do unions feel about any attempt from management to redesign jobs o don t like it resist change 90 How do economic factors affect redesigning ofjobs o If you don t have the money you can t redesign jobs ORGANIZATIONAL DESIGN 91 What is the relationship between specialization and coordination according to the specializationcoordination dilemma o The more you specialize the harder it is to coordinate o coordination goes up then specialization goes down 92 Where is it more difficult to coordinate within departments or between departments Why o Between different values and goals 93 What is the primitiveagency organizational design What are its advantagesdisadvantages o boss and a number of employees report directly to that boss 0 advantages flexible and simple 0 disadvantages breaks down as it gets bigger or complex 94 What is the functional organizational design How are activities grouped o group jobs according to job specialized departments 95 What are the advantages of a functional design o Technical expertise and efficiency 96 What are the disadvantages of a functional design o coordination 97 When does one use the functional design o small one product stable environment defender strategy 98 What is the product design How are activities grouped o according to product VP o coordination for the product 99 What are the advantages of a product design o coordination 100 What are the disadvantages of a product design o efficiency technical expertise 101 When does one use the product design o large complex lots of products dynamic environment prospector strategy 102 What is a profit center and what are its benefits o Each product has profit centers so you can see which product is making money and which is losing money Feedback and Accountability 103 What is a matrix design How are activities grouped o combination of functional and product o grid matrix 104 What are the advantages of a matrix design o efficient technical expertise and coordination 105 What are the disadvantages of a matrix design o employees suffer no loyalty to product multiple bosses 106 When does one use the matrix design o Same a product o high tech large complex lots of products dynamic environment prospector strategy 107 What is the job of a project manager in the matrix design o coordination 108 What is the job of a functional manager in the matrix design o specialization keeps employees technically up to date o also send personal out to the individual projects 109 Which type of manager has no formal authority in the matrix design o project manager 110 In which organizational design type is it most difficult to replace the CEO from within the organization Why is this the case o functional don t have a large pool to replace them from outside not generally trained managers 111 Which organizational design accommodates growth readily o product and matrix 112 What is scalar chain or chain of command What functions does it serve What structural mechanism does one use to bypass the strict chain of command in organization o Tells you the formal communication network slow o 1 defines level of authority and 2 it routes directives and information up and down the organizationprovides an informationdecision network o Jumping the chain to bypass bypassed the most in matrix and the least in functional 113 What is unity of command Why does one try not to violate this principle of organizing o Every employee should report to one boss 114 Where is unity of command violated In what organizational design type is unity of command violate to the greatest extent o Violated everywhere matrix the most and purposely 115 What is delegation of authority Why do managers delegate authority o Delegation is the process in which authority passes from one level to another o providing the employee with a chance to grow and develop You give the employee freedom to succeed 116 What cannot be delegated when a manager delegates authority o Accountability responsibility 117 Why do managers resist delegating authority o 1 the manager feels like heshe lacks trained subordinates o 2 the manager feels like heshe is only capable of doing the work o 3 the manager may fear that the subordinates will make costly mistakes o 4 the manager may fear that if the subordinate handles the task well then the subordinate could become a competitor The manager might be shown up by the subordinate o 5 the manager may believe that delegating makes them look lazy o 6 the manager may find that it is easier to do it themselves This is especially true when the manager has difficulty communicating directions clearly o 7 the manager resists delegating for fear of losing control 118 What do the terms centralized and decentralized mean as they pertain to delegation of authority o Centralized is the extent to which authority isn t delegated but concentrated at higher levels of management o Decentralized is the extent to which authority is delegated 119 What are the signs that one s organization is becoming decentralized o 1 more decisions are made by lower levels of management o 2 more important decisions are made by lower levels of management o 3 more flexibility is allowed for lower level managers in interpreting policies o 4 more autonomy is allowed for lower level managers in decision making 120 What are the benefits of decentralized organizations o 1 lower level managers can deal with problems on the spot o 2 it provides opportunity for lower level managers to develop their decision making skills EMPLOYEE DEVELOPMENT o 3 motivation of lower level managers is boosted when they re entrusted to make decisions rather than just always following orders Their jobs are enriched 4 it spreads the organization s work load out and allows top managers more time for strategic planning 121 When does an organization need to decentralize o Decentralization becomes necessary as an organization grows in size because coordination problems force you to make others responsibleaccountable for coordination 122 What does span of control mean o refers to the number of subordinatespeople who report directly to a supervisor 123 What is the relationship between span of control and organizational height o The narrower the span of control the taller the organization eg more management levels and the wider the span of control the flatter the organization eg fewer management levels 124 What is the paradox of managerial control as it relates to span of control The paradox of managerial control with narrow spans of control is that narrow spans of control allow managers tighter control over their subordinates but this loosens overall control from top to bottom in the organization because there are now more managerial levels The result of narrow spans of control and hence more levels of management is a greater distortion of communication traveling up and down the scalar chain in the organization These successive management levels act as filters in the communication process Therefore in an organization where there are narrow spans of control top management has less control over lower levels of management 125 What are the advantages and disadvantages of wide spans of control On one hand it can lead to substantial payroll savings by eliminating managerial jobs downsizing and it can improve overall communication from the top to the bottom of the organization However on the downside it can decrease managerial control and supervisor subordinate communication on each managerial level It also can increase career gridlock this flat organizational design leaves little chance for moving up because you have eliminated management levels and there are less opportunities for advancement in a flat structure thus promotionspay increases are slower Also in a flat structure managerial workload is increased which can be more stressful because you are overloaded Just look at what happens to managers when organizations downsize ie became flatter and have looser managerial control on any given level They are asked to do more and supervise more people 126 What is the optimal span of control c There is no optimal span of control 127 What are the factors that narrow span of control widen span of control o Narrow has more control over employees o Wide downsizing less control
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