A01_ROBB6929_07_SE_FM.

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FUNDAMENTALS
OF MANAGEMENT

SEVENTH CANADIAN EDITION

STEPHEN P. ROBBINS
San Diego State University

DAVID A. DECENZO
Coastal Carolina University

MARY COULTER
Missouri State University

IAN ANDERSON
Algonquin College

Toronto
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in this textbook appear on the appropriate page within the text and on p. XXX.

Original edition published by Pearson Education, Inc., Upper Saddle River, New Jersey, USA.
Copyright 2013 Pearson Education, Inc. This edition is authorized for sale only in Canada.

If you purchased this book outside the United States or Canada, you should be aware that it has been imported
without the approval of the publisher or author.

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10 9 8 7 6 5 4 3 2 1 [Catch printer initials]

Library and Archives Canada Cataloguing in Publication

Fundamentals of management / Stephen P. Robbins . . . [et al.].

7th Cdn. ed.

Includes bibliographical references and index.

ISBN 978-0-13-260692-9

1. ManagementTextbooks. I. Robbins, Stephen P., 1943

HD31.R5643 2013 658.4 C2012-905692-8

ISBN 978-0-13-260692-9
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Brief Contents
Preface 00
Acknowledgments 00
About the Authors 00

Part One Introduction to Management and Organizations 2

Chapter 1: Introduction to Management and Organizations 2
Supplement 1: Small and Medium-Sized Enterprises and Organizations 22
Chapter 2: Environmental Constraints on Managers 32
video case incidents 64

Part Two Planning 66

Chapter 3: Planning and Strategic Management 66
Chapter 4: Decision Making 100
video case incidents 136

Part Three Organizing 138

Chapter 5: Organizational Structure and Design 138
Chapter 6: Communication and Information Technology 166
Chapter 7: Human Resource Management 194
video case incidents 230

Part Four Leading 232

Chapter 8: Leadership 232
Chapter 9: Motivating Employees 264
Chapter 10: Understanding Groups and Teams 294
video case incidents 322

Part Five Controlling 324

Chapter 11: Foundations of Control 324
Chapter 12: Managing Change 360
video case incidents 390

Endnotes 408
Glossary 410
Subject Index and Name and Organization Index 456
List of Canadian Companies, by Province 463
List of International Companies, by Country 465
Photo Credits 469

iii
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Contents
Preface x
Acknowledgments xvii
About the Authors xviii

Part 1 Defining the Managers The Systems Approach 29

Terrain 2
Chapter 1 Introduction to Management
and Organizations 2
Who Are Managers? 4
Types of Managers 4
What Is Management and What Do
Managers Do? 6
Efficiency and Effectiveness 6
Management Functions 6
Management Roles 8
Management Skills 10
What Is an Organization? 11
The Size of Organizations 12
The Types of Organizations 12
Why Study Management? 13
The Universality of Management 14
The Reality of Work 14
Self-Employment 15
Review and Apply
Summary of Learning Objectives 00 Snapshot
Summary 00 MyManagementLab
Learning Resoucres 00 Interpret What
You Have Read 00 Apply What You Have
Learned 00 Develop Your Management
Skills 00 Team Exercises 00 Business Cases 00
Supplement 1: History of Management
Trends 22
Historical Background of Management 23
Scientific Management 23
Important Contributions 23
The Quantitative Approach 27
Important Contributions 27
How Do Todays Managers Use the Quantitative
Approach? 27
Organizational Behaviour 27
Early Advocates 27
The Systems Approach and Managers 29
The Contingency Approach and Managers 30
Summarizing Management Theory 31
Chapter 2 Environmental Constraints
on Managers 32
The Manager: How Much Control? 34
The External Environment 35
The Specific Environment 36
The General Environment 37
Understanding the Global Environment 40
Global Trade 41
The Cultural Environment 42
Doing Business Globally 44
Different Types of International Organizations 45
How Organizations Go Global 46
How the Environment Affects Managers 48
Assessing Environmental Uncertainty 48
Review and Apply
Summary of Learning Objectives 00 Snapshot
Summary 00 MyManagementLab Summary 00
Interpret What You Have Read 00 Apply What
You Have Learned 00 Develop Your Management
Skills 00 Team Exercises 00 Business Cases 00
Management Case Incident
Continuing Case: Starbucks 60
video case incidents
Mountain Equipment Co-op 65
Part 2 Planning 66
Chapter 3 Planning and Strategic
Management 66
What Is Planning? 67
Purposes of Planning 68
Planning and Performance 69

v
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vi | C ON TE NT S
How Do Managers Plan? 69
Approaches to Establishing Goals 69
Steps in Goal Setting 71
Developing Plans 71
Criticisms of Planning 74
Organizational Strategy: Choosing a Niche 76
Step 1: Identify the Organizations Current Mission,
Goals, and Strategies 76
Step 2: Do an Internal Analysis 77
Step 3: Do an External Analysis 79
Step 4: Formulate Strategies 80
Step 5: Implement Strategies 81
Step 6: Evaluate Results 81
Types of Organizational Strategies 81
Corporate Strategy 82
Business Strategy 85
Functional Strategy 90
Quality as a Competitive Advantage 90
How Can Benchmarking Help Promote
Quality? 90
What Is the ISO 9000 Series? 90
How Can Attaining Six Sigma Signify Quality? 91
Review and Apply
Summary of Learning Objectives 00 Snapshot
Summary 00 MyManagementLab Summary 00
Interpret What You Have Read 00 Apply What
You Have Learned 00 Develop Your Management
Skills 00 Team Exercises 00 Business Cases 00
Chapter 4 Decision Making 100
The Decision-Making Process 101
Step 1: Identify a Problem 102
Step 2: Identify Decision Criteria 102
Step 3: Allocate Weights to Criteria 103
Step 4: Develop Alternatives 104
Step 5: Analyze Alternatives 104
F-400
Step 6: Select an Alternative 105
Step 7: Implement the Alternative 105
Step 8: Evaluate Decision Effectiveness 106
The Manager as Decision Maker 106
Making Decisions: Rationality, Bounded Rationality,
and Intuition 107
Types of Problems and Decisions 109
Decision-Making Conditions 111
Decision-Making Styles 112
Group Decision Making 114
Individual vs. Group Decision Making 115
Decision-Making Biases and Errors 115
Ethics, Corporate Social Responsibility,
and Decision Making 117
Four Views of Ethics 118
Improving Ethical Behaviour 119
Corporate Social Responsibility 120
Review and Apply
Summary of Learning Objectives 00 Snapshot
Summary 00 MyManagementLab Summary 00
Interpret What You Have Read 00 Apply What
You Have Learned 00 Develop Your Management
Skills 00 Team Exercises 00 Business Cases 00
video case incidents
Joe Six-Pack and Four Canadian Entrepreneurs 136
Ben & Jerrys in Canada 137
Endnotes 408
Glossary 440
Subject Index 451
Name and Organization Index 456
List of Canadian Companies, by Province 463
List of International 00
Companies, by Country 00
Photo Credits 00
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Preface
Welcome to the seventh Canadian edition of Fundamentals of Management, by Stephen P.
Robbins, David A. DeCenzo, Mary Coulter, and Ian Anderson. This edition continues the
textbooks fresh approach to management coverage through
current and relevant examples
updated theory
a new pedagogically sound design
The philosophy behind this revision was to put additional emphasis on the idea that
management is for everyone. Students who are not managers, or who do not envision
themselves as managers, may not always see why studying management is important. We
use examples from a variety of settings to help students understand the relevance of studying
management to their day-to-day lives.

CHAPTER PEDAGOGICAL FEATURES

We have enhanced the
seventh Canadian edition PART 1 DEFINING THE MANAGERS
Tell
Explain
does study-

1
through a rich variety of CHAPTER Introduction 1.1
what makes
someone
a manager?
1.4
ing manage-
ment make
a difference?
LEARNING
OBJECTIVES
p.26
pedagogical features, in- to Management
p.36

cluding the following: and 1.3

Describe
what
characteristics
define an

Organizations
organization?
p.33
Learning objectives
to guide student 1.2
Define
what is
management
and what do

learning begin each managers do?

p.28

chapter. These ques-

tions are repeated Heading if any
at the start of each Brian Scudamore was an 18-year-old university student in need
of money when he founded Vancouver-based 1-800-GOT-JUNK?
Think About It
What kinds of skills do managers
North Americas largest junk-removal service.1 An inspira-
major chapter sec- tion came to me when I was in a McDonalds drive-through in
Vancouver. I saw a beaten-up pickup truck with plywood panels
need? Put yourself in Brian Scuda-
mores shoes.What kinds of leader-
ship skills would you need to manage

tion to reinforce the advertising junk pickup and hauling.

At first, hauling junk was meant to get him through university.
franchises in four countries? Does
managing in a franchise organiza-
tion differ from managing in a large
However, by the third year of his studies, the business had grown corporation, a small business, or a

learning objective. enough that he dropped out of school to manage it full time.
Scudamore started his business in 1989 with a $700 pickup
government organization?

An opening case truck, but now has over 300 franchises throughout Canada, the United
States, Australia, and the United Kingdom. He says he based his business
model on Federal Express, which offers on-time service and up-front rates.
starts the body of Drivers wear clean uniforms and drive shiny, clean trucks.
Scudamore learned about business by doing business. He also learned

the chapter and is that it is important for managers to involve employees in decision making:
As soon as I stopped trying to be the CEO whos got everything under con-
trol, there was an instant shift, he says. My managers started seeing me as
threaded throughout someone they could disagree withand that makes all of us stronger.

3
the chapter to help
students apply a
story to the concepts
they are learning.
Think About It questions follow the opening case to give students a chance
to put themselves in the shoes of managers in various situations.
t a man-
Integrated questions (in the form of yellow notes) throughout the chapters ning, organizing, com- Think abou ve had,
management textbooks ager you ha e extent
help students relate management to their everyday lives fy th
ent functions: planning, and identi he or she
But you do not have to to which anning,
Tips for Managers boxes provide take-aways from the chapterthings lead, and control, so un-
pl
engaged in leading,
g,
that managers and would-be managers can start to put into action right now, Lets briefly define whatt organizin lling.
and contro
based on what they have learned in the chapter.

vii
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viii | PR EFACE

END-OF-CHAPTER APPLICATIONS SUPPLEMENT 1

systems based on output, they are using
The entire end-of-chapter section, Review and Apply, provides a wealth the principles of scientific management.
But current management practice is not TIPS FOR MANAGERS
restricted to scientific management.

of exercises and applications. In fact, we can see ideas from the next
major approachgeneral administrative
theorybeing used as well. Q&A S1.2
Fayols 14 Principles of Management
Division of work. Specialization increases output by making employees
more efficient.

GENERAL
The Summary of Learning Objectives provides responses to theout- ADMINISTRATIVE
Authority. Managers must be able to give orders, and authority gives them
this right.

Discipline. Employees must obey and respect the rules that govern the or-
THEORY ganization.

come-based questions identified at the beginning of each chapter. Another group of writers looked at the
subject of management but focused on
Unity of command. Every employee should receive orders from only onesu-
perior.

Accompanying this feature is a Snapshot Summary box that pro- the entire organization. These general
administrative theorists developed
more general theories of what managers
Unity of direction. The organization should have a single plan of action to
guide managers and employees.

Subordination of individual interests to the general interest. The inter-

do and what constitutes good manage- ests of any one employee or group of employees should not take prece-

vides a quick look at the organization of the chaptertopics. ment practice. Lets look at some impor-
tant contributions that grew out of this
dence over the interests of the organization as a whole.

Remuneration. Employees must be paid a fair wage for their services.

perspective.

The MyManagementLab Learning Resources table provides a Important Contributions
The two most prominent theorists
Centralization. This term refers to the degree to which subordinates are in-
volved in decision making.

Scalar chain. The line of authority from top management to the lowest ranks

synopsis of all of the tools found on the MyLab.

is the scalar chain.
behind general administrative theory
were Henri Fayol and Max Weber. Order. People and materials should be in the right place at the right time.

Equity. Managers should be kind and fair to their subordinates.

HENRI FAYOL
Interpret What You Have Read allows students to review their un- We mention Fayol in Chapter 1 because
he described management as a universal
Stability of tenure of personnel. Management should provide orderly
personnel planning and ensure that replacements are available to fill
vacancies.
set of functions that included planning,

derstanding of the chapter content. organizing, commanding, coordinating,

and controlling. Because his ideas were
Initiative. Employees who are allowed to originate and carry out plans will
exert high levels of effort.

important, lets look more closely at Esprit de corps. Promoting team spirit will build harmony and unity within the

Analyze What You Have Read helps students see the application of what he had to say.6
Fayol wrote during the same time pe-
riod as Taylor. While Taylor was con-
organization.

theory to management situations. cerned with first-line managers and the

scientific method, Fayols attention was
directed at the activities of all managers.
tribution, and other typical business fundamental rules of management that
He wrote from personal experience be-
Assess Your Skills gives students an opportunity to discover things about cause he was the managing director of a
large French coal-mining firm.
functions. His belief that management
was an activity common to all human
endeavours in business, government,
could be taught in schools and applied
in all organizational situations. These
principles are shown in Tips for Man-
Fayol described the practice of man-

themselves, their attitudes, and their personal strengths and weaknesses. agement as something distinct from
accounting, finance, production, dis-
and even in the home led him to de-
velop 14 principles of management
agersFayols 14 Principles of
Management. Q&A S1.3

Each chapter includes one self-assessment exercise that students can fill
out and refers students to the MyManagementLab website where therbligs
A classification scheme for labelling 17 basic hand
motions.
general administrative theorists
managers do and what constitutes good manage-
ment practice.
principles of management
Fourteen fundamental rules of management that
zational situations.
bureaucracy
A form of organization characterized by division of
labour, a clearly defined hierarchy, detailed rules

they can access additional interactive self-assessment exercises. Writers who developed general theories of what could be taught in schools and applied in all organi- and regulations, and impersonal relationships.

27

Practise What You Have Learned lets students apply material

to their daily lives as well as to real business situations related
to the chapter material, helping them see that planning, lead-
1
Review and Apply
ing, organizing, and controlling are useful in ones day-to-day Summary and Implications
1.1 What makes someone a manager? Managers work (where the emphasis is on providing charity or serv-

life too. This feature includes several exercises, such as the
with and through other people by coordinating em-
ployee work activity in order to accomplish organiza-
tional goals. Managers may have personal goals, but
ices rather than on making a profit).
Brian Scudamore owns his company and thus is ultimately
responsible to himself. Most managers report to someone else.

ones described below: management is not about personal achievementits

about helping others achieve for the benefit of the or-
ganization as a whole.
1.4 Does studying management make a difference?
There are many reasons why students end up in man-
agement courses. Some of you are already manag-
Dilemma presents an everyday scenario for students to
As we saw with Brian Scudamore, he sees his role as a cheer-
ers and are hoping to learn more about the subject.
leader to help everyone in the organization do a better job.
Some of you hope to be managers someday. And
1.2 What is management and what do managers do? some of you might not have ever thought about being

resolve using management tools. Management is coordinating work activities of peo-

Becoming a Manager provides suggestions for students
ple so that they are done efficiently and effectively.
Efficiency means doing things right and getting
managers. Career aspirations are only one reason to
study management, however. Any organization you
encounter will have managers, and it is often useful
things done at the least cost. Effectiveness means do- to understand their responsibilities, challenges, and
ing the right things and completing activities that
will help achieve the organizations goals. To do their
experiences. Understanding management also helps us
improve organizations.
jobs, managers plan, organize, lead, and control. This

on activities and actions they can do right now to help
means they set goals and plan how to achieve those
goals; they figure out what tasks need to be done, and
who should do them; they motivate individuals to
SNAPSHOT SUMMARY
Who Are Managers?

them prepare to become a manager. achieve goals, and communicate effectively with oth-
ers; and they put accountability measures into place to
make sure that goals are achieved efficiently and ef-
1.1 Types of Managers

fectively.
Developing Your Diagnostic and Analytical Skills asks In Brian Scudamores role as CEO of 1-800-GOT-JUNK? he
sets the goals for the overall organization, working with the
1.2
What Is Management and What Do
Managers Do?
Efficiency and Effectiveness
various franchise partners. One of the challenges he faces is
Management Functions

students to apply chapter material to analyze a case. determining how rapidly his company can expand without
diluting its brand.
Management Roles
Management Skills
1.3 What characteristics define an organization? There

Developing Your Interpersonal Skills emphasizes the is no single type of organization. Managers work in a
variety of organizations, both large and small. They 1.3
What Is an Organization?
The Size of Organizations
also work in a variety of industries, including manu- The Types of Organizations

importance of communication and interaction skills. facturing and the service sector. The organizations
they work for can be publicly held (meaning shares
are traded on the stock exchange and managers are 1.4
Why Study Management?
The Universality of Management
responsible to shareholders), privately held (meaning The Reality of Work

Team Exercises gives students a chance to work together in shares are not available to the public), public sector
(where the government is the employer), or nonprofit
Self-Employment

groups to solve a management challenge and includes two

MyManagementLab For more resources, please visit www.pearsonglobaleditions.com/mymanagementlab

new exercises: 3BL: The Triple Bottom Line and Be the Con- 16 | C H A P T E R 1 I N T R O D U C T I O N T O M A N A G E M E N T A N D O R G A N IZ AT IO N S 17

sultant. Both of these exercises were added to the seventh

MyManagementLab Learning Resources
Canadian edition in order to increase the sustainability com-
ponent of the text and to give students more of a hands-on Resources
perspective into consulting. Explore and enhance your understanding of key
chapter topics through the following online resources:

The Business Cases are decision-focused cases that ask students Student PowerPoints
Audio Summary of Chapter
to determine what they would do if they were in the situation Annotated Exhibits
CBC Videos for Part [X]

described. MySearchLab

Test your progress with Study Plan Pre-Tests and Post-Tests. The Pre-Tests help identify chapter concepts
youve understood, and guides you to study tools for the areas in which you might need a little more practice. The
Post-Tests confirm your mastery of the chapter concepts.

MYMANAGEMENTLAB Build on your knowledge and practice real-world applications

using the following online activities:

An access code to MyManagementLab is included with the textbook Interpret Analyze Practice

Fundamentals of Management. MyManagementLab is an online study Opening Case Activity: Opening Case Activity: Opening Case Activity:
What Does Planning Strategic Planning at Appraise Maple Leaf
tool for students and an online homework and assessment tool for facul- Involve?
Review and Apply:
Maple Leaf Foods
Review and Apply:
Foods Strategic
Situation

ty. For the seventh Canadian edition, MyManagementLab resources and Solutions to Interpret
section questions and
activities
Solutions to Analyze
section questions and
activities
Review and Apply:
Solutions to Practice
section questions and

features have been specifically tailored by two innovative and experi- Glossary Flashcards
Chapter Quiz
Management Skills
Management Mini-
activities
BizSkills Simulations:
Case for Chapter X [Insert simulation

enced Canadian contributors. This new author team has ensured that key ROLLS: [Insert relevant
questions and activities
title(s) here]
Decision Making
here] Simulations: [Insert
chapter concepts are supported by specific and easy-to-navigate online Self-Assessment Library
[Insert relevant
simulation title(s) here]

and instructor activities highlighted with icons in the textbook, MyMan- question sections here]

agementLab, and the Instructors Manual.

A01_ROBB6929_07_SE_FM.indd Page ix 10/5/12 7:43 PM F-400

PREFACE | ix

The new MyManagementLab resources and features are built on an instructor-driven

philosophy of presenting activities that challenge students on many different levels of
learning. Key MyManagementLab activities have been highlighted in the text using carefully
placed icons that link key concepts and examples to corresponding online study and assess-
ment tools. This new framework and set of activities support the established and popular
features of MyManagementLab, such as the Personalized Study Plan, Auto-Graded Tests
and Assignments, Pearson eText, Glossary Flashcards, Robbins OnLine Learning System
(R.O.L.L.S.), the Self-Assessment Library, and much more! Learn more about MyManage-
mentLab at www.pearsoned.ca/mymanagementlab.
For more details about the philosophy and vision for the new textbook, MyManagementLab,
and supplement integration strategy, see the MyManagementLab authors message below.

A Message from our

MyManagementLab Author Team
As instructors who have used Fundamentals of Management over the past several years in
our management courses, we are delighted to be involved in the development of the seventh
Canadian edition. The world of business affects our lives every day, and management will
affect the lives of all of us who work for a living. Our goal, therefore, has been to help deliver
a text, supplemental materials, and online learning package that will engage students in a
positive and direct manner as they build their fundamental knowledge of business in general
and management in particular. In addition to viewing the material from the student perspec-
tive, we also strove to facilitate the instructors use and application of the rich subject mate-
rial and resources to provide a dynamic, interactive, and enjoyable classroom experience.
As a preamble, we thought it would be helpful to outline the basic assumptions and phi-
losophy underlying our contributions to the Fundamentals of Management text, MyManage-
mentLab, and supplemental materials. First, we know that for most students this course is their
introduction to business and to management. For this reason, we approach the subject material
with a view to building the students knowledge one block at a time. Second, we believe that
once students learn the material, they should have an opportunity to play with it as they think
about it. The interactive nature of MyManagementLab offers the perfect environment within
which students may play and learn. Finally, we want to encourage students, as they master the
material, to reach into their new tool kit to problem solve, and in doing so, understand the
relevance of the concepts to both their personal, and eventually, working lives. Again, we are
ever mindful of providing the instructor with his or her own tool box for delivering the material
in an interesting and engaging manner.
To reinforce our building-block approach, our directives to Interpret, Analyze, and Prac-
tise, in alignment with the learning objectives, have been based upon the following pedagogy:
ComprehensionInterpret What You Have Read
ApplicationAnalyze What You Have Read
Synthesis/EvaluationPractise What You Have Learned
To these ends we have
Used the learning objectives as our guide in linking chapter content with the
MyManagementLab activities and in the preparation of related exercises and activities;
Prepared activities to complement the in-text cases and exercises, and to encourage
students to interpret, analyze, and practise the subject material;
Indicated which MyManagementLab content is best linked to the textbook by explicitly
referencing this material as part of our exercises and activities;
Identified where and with what material we believe the content icons directing students
to Interpret, Analyze, and Practise should be associated in the chapter;
Prepared directives, located within each chapter, in conjunction with the icons.
We sincerely hope that both student and instructor will find this text and the accompa-
nying supplemental materials to be a practical and enjoyable route to learning and using the
fundamental tools of business management.
Amanda Bickell (Kwantlen Polytechnic University) and Floyd Simpkins (St. Clair College)
A01_ROBB6929_07_SE_FM.indd Page x 10/5/12 7:43 PM F-400

x | PR EFA CE

Study on the Go
Featured at the end of each chapter, you will find a unique barcode providing access to
Study on the Go, an unprecedented mobile integration between text and online content.
Students link to Pearsons unique Study on the Go content directly from their smartphones,
allowing them to study whenever and wherever they wish! Go to one of the sites below to
see how you can download an app to your smartphone for free. Once the app is installed,
your phone will scan the code and link to a website containing Pearsons Study on the Go
content, including the popular study tools Glossary Flashcards, Audio Summaries, and
Quizzes, which can be accessed anytime.
ScanLife
http://get.scanlife.com/
NeoReader
http://get.neoreader.com/
QuickMark
http://www.quickmark.com.tw/

NEW TO THE SEVENTH CANADIAN EDITION

In addition to the new pedagogical features highlighted on previous pages, we
have introduced or revised other learning aids and made significant changes to
Vide
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This edition offers a variety of cases that can be used in or out of thee class- Gree
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MANAGEMENT
MAN
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G E M ENT CASES
09/01 tion,
/21/bu

quality videos that range in length from 3 Management Cas Cases

asses
ases
e
voluntary board of directors which oversaw national plans and pri-
orities. Volunteer board members were nominated by the member
associations. YMCA Canadas President and CEO was accountable
lbs.htm
spirits,
l minds and bodies, while building strong kids, strong
families and strong communities;
assists people to participate in the YMCA who otherwise
to the board for national operations. The national office had only 20

to 18 minutes. They focus on several man- employees in 2005, reflecting the relative autonomy of the member
associations.
As in the rest of the world, YMCAs in Canada served people
could not afford to be involved;
is seen as a valued contributor to the community;
has the capacity to influence the community relative to its
strategic priorities;

agement issues within a part and include

The case The YMCA of London, Ontario focuses on the need to
engage in long-term strategic planning, while developing commu-
nity relations. At the same time, the organization is facing a number
of all ages, backgrounds and abilities and through all stages of life.
THE YMCA
CA They were dedicated to helping people attain a healthy lifestyle and has quality programs that help members meet their personal
encouraging them to get involved in making their community a bet- goals;
The Young Mens Christian Association (YMCA) was an interna- ter place. As charities, the YMCA member associations relied on demonstrates growth in participation over time;
tional federation
ion of autonomous not-for-profit community service

a set of all new objectives-based ques-
of internal struggles because of the different business models of the
core service areas. What can management do to effectively address
the internal and external concerns raised in this case?
organizations dedicated to meeting the health and human service
needs of men, n, women and children in their communities. The
YMCA was founded in London, England in 1844, in response to
the support of their communities, the private sector, governments
and other agencies. YMCA fundraising campaigns helped to provide
better programs and facilities, as well as greater accessibility and
financial assistance to include as many people as possible.5
offers a variety of programs that are accessible to the com-
munity;
has a culture of involving their members continually by en-

tions. Sandra Wellman (Seneca College) MC-1

the unhealthy social conditions resulting from the industrial revolu-
tion. Its founder,
der, George Williams, hoped to substitute Bible study
and prayer forr life on the streets for the many rural young men who
had moved to the cities for jobs. By 1851, there were 24 YMCAs
Earlier in 2005, YMCA Canada, in conjunction with its member
associations, had developed a strong association profile, which com-
prised a wide range of performance measures similar to a balanced
couraging them to give their time, talent and treasure to the
YMCA;
has identified key audiences and has a communications plan
scorecard. Implementation of this measurement tool was voluntary, that addresses each audience.

carefully selected the videos and wrote The YMCA of

in Great Britain and the first YMCA in North America had opened
in Montreal. Three years later, in 1854, there were 397 separate
YMCAs in seven nations, with a total of 30,400 members.2
London, Ontario From its start, the YMCA was unusual in that it crossed the rigid
although YMCA Canada encouraged individual associations to use
it to assess their performance and to compare their performance with
other associations. According to the YMCA Canada strong associa-
The London Y had piloted an earlier version of the strong association
profile and had already set annual targets for 2005 through to 2010
(see Exhibit 1). The London Y planned to implement these targets
tion profile, a strong YMCA position profile is as follows:

the cases and questions to provide in- lines that separated the different churches and social classes in Eng-
land at the time. This openness was a trait that would lead eventually
to YMCAs including all men, women and children regardless of race,
demonstrates that it is having an impact on individuals
and measures as part of its 2005 strategic planning cycle.

As Shaun Elliott, chief executive officer, prepared for the last se- religion or nationality. In 2005, the YMCA was in more than 120

structors with engaging material for their
nior management planning session in 2005, he reflected on what the
YMCA of London (the London Y or the association) had achieved
in the last four years. Since joining in 2001, Elliott had led the or-
countries around the world and each association was independent and
reflected its own unique social, political, economic and cultural situ-
ation. YMCAs worldwide shared a commitment to growth in spirit,
EXHIBIT 1 The YMCA of London Participation Targets

Traditional Organization New Organization

ganization from a deficit of $230,0001 to a projected surplus of al-

students. The videos are available on the mind and body, as well as a focus on community service, social 2005 2006 2007 2008 2009 2010 5 yr inc Avg inc
most $1 million by the end of this fiscal year. This turnaround had change, leadership development and a passion for youth.3 Childcare
been accomplished through a careful balance of internal cost cutting A similar, although separate organization, the Young Womens Infant 70 70 70 70 70 70 0% 0%
and growth through partnering and program expansion. Innovative Christian Association (YWCA) was founded in 1855 in England.4

MyManagementLab and in DVD format It remained a separate organization; however, some YMCA and Toddler 140 140 140 140 140 140 0% 0%
partnerships with other organizations had allowed the London Y to
Preschool 608 672 736 832 928 1,024 68% 14%
expand its programs and facilities with minimal capital investment. YWCAs chose to affiliate in order to best serve the needs in their
In addition to its now solid financial performance, the London Y communities. School Age 316 316 316 316 316 316 0% 0%
was on track to exceed its targeted participation level of 46,500 in- Childcare Total 1,134 1,198 1,262 1,358 1,454 1,550 37% 7%

(ISBN 978-0-13-511763-7). dividuals by the end of 2005. It was now time for Elliott to turn his
attention to achieving the next level of growth: participation levels
of 102,000 individuals by 2010. He knew that to achieve an increase
THE YMCA IN CANADA
The London Y was a member of YMCA Canada, the national body
Camping and Educational Services
CQE 1,815 2,215 2,215 2,439 2,471 2,471 36% 7%

of this magnitude, senior management would need to increase their of the 61 Canadian member associations. YMCA Canadas role was Day Camp 5,350 5,457 5,566 5,677 5,791 5,907 10% 2%
focus and its capacity and that he would need to spend more time on to foster and stimulate the development of strong member associa- Outdoor Education 5,800 6,960 9,048 9,953 10,948 12,043 108% 22%

Management Mini-Cases (MyMan- longer term strategic initiatives and community relations. He won-
dered if this was possible given the current situation.
tions and advocate on their behalf regionally, nationally and inter-
nationally. YMCA Canada was a federation governed by a national
Childrens Safety Village
Community School Programs
Camping Total
12,000
1,630
26,595
13,500
1,880
30,012
14,000
2,130
32,959
14,000
2,380
34,449
14,000
2,630
35,840
14,000
2,880
37,301
17%
77%
40%
3%
15%
8%

agementLab) 1
All funds in Canadian dollars unless specified otherwise.
2
http://www.ymca.net/about_the_ymca/history_of_the_ymca.html. Accessed February 23, 2006.
3
http://www.ymca.ca/eng_worldys.htm. Accessed Feb. 23, 2006.
4
http://www.ywca.org/site/pp.asp?c=djISI6PIKpG&b=281379. Accessed February 23, 2006.
Health Fitness and Recreation
CBY full fee
CBY assisted
5,450
2,210
5,580
2,330
5,750
2,450
5,825
2,500
6,000
2,525
6,200
2,650
14%
20%
3%
4%
CBY programs 4,200 4,580 4,975 5,750 6,875 8,050 92% 18%
Pat MacDonald prepared this case under the supervision of W. Glenn Rowe solely to provide material for class discussion. The authors do not
intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other BHY full fee 1,500 1,525 1,900 2,100 2,400 2,700 80% 16%

Hosted within MyManagementLab and identifying

information to protect confidentiality.
Ivey Management Services prohibits any form of reproduction, storage or transmittal without its written permission. This material is not covered
under authorization from CanCopy or any reproduction rights organization.
BHY assisted
BHY programs
300
1,600
305
7,565
380
9,100
420
10,195
480
11,480
540
13,125
80%
720%
16%
144%
ELY full fee 1,025 1,050 1,050 1,075 1,200

tied to each chapter are a set of 12 Man- 34

Copyright 2006, Ivey Management Services
One-time permission to reproduce granted by Ivey Management Services on October 30, 2009.
Version: (A)2006-04-11.
5
http://www.ymca.ca/eng_abouty.htm. Accessed February 23, 2006. (continued)
35

agement Mini-Cases with associated

A01_ROBB6929_07_SE_FM.indd Page xi 10/5/12 7:43 PM
multiple-choice questions. These mini-cases are perfect for
assignments, as the students results feed directly into the
MyManagementLab Gradebook.
NEW Multi-Chapter Cases (MyManagementLab)
Hosted within MyManagementLab and prepared by the text-
book author, Ian Anderson, are three NEW, medium-length,
multi-chapter cases for Parts 2 (Planning), 3 (Organizing) and
4 (Leading). Assessments for these multi-chapter cases include
online multiple-choice and short-answer questions.
CHAPTER-BY-CHAPTER HIGHLIGHTS
Below, we highlight the new material that has been added to
this edition.
Chapter 1
Updated opening case on 1-800-GOT-JUNK?
New end-of-chapter (EOC) material (Be the Consultant,
3BL, Business Cases, heavily revised Dilemma/Becoming a
Manager, etc.)
Supplement 1
Brand new supplement on Small and Medium-Sized En-
terprises and Organizations
Chapter 2
New opening case on TransCanada and the Keystone Pipe-
line Project
Heavily revised The General Environment, with all sub-
sections updated plus new material added on environmen-
tal conditions
New EOC material (Be the Consultant, 3BL, Business
Cases, etc.)
Chapter 3
New opening case on Maple Leaf Foods
Criticisms of Planning moved to early in the chapter
New material on forecasting, contingency planning,
scenario planning, and benchmarking
New exhibit on SWOT Analysis and new material on
PESTEL Analysis
Learning Objective #5 from the sixth Canadian edition
(How can quality be a competitive advantage?) and its cor-
responding chapter material on quality management, ISO
9000, and Six Sigma deleted
New EOC material (Be the Consultant, 3BL, Business Cases,
revised Dilemma/Becoming a Manager, etc.)
Chapter 4
New opening case on Nurse Next Door
New material on bounded decision making
New material on employee involvement in decision making
New EOC material (Be the Consultant, 3BL, Business
Cases,etc.)
F-400
PREFACE | xi
Chapter 5
Updated opening case on Maple Leaf Sports and
Entertainment
New EOC material (Be the Consultant, 3BL, Business
Cases,etc.)
Chapter 6
Updated opening case on Facebook and social networking
New material on mental models
New Tips for Mangers box on Communication with
Diverse Individuals
New tips on Receiving Feedback added to Tips for Manag-
ers box on Giving Feedback
Enhanced information on email and instant messaging,
and new material on wikis and blogs
New Tips for Managers box on Getting Started with Social
Media
New material on social media strategies
New EOC material (Be the Consultant, 3BL, Business
Cases, etc.)
Chapter 7
New opening case on the Calgary Chamber of Voluntary
Organizations
Material on organizational change (moved from Chapter 11),
demographic trends, and technology added to Human
Resource Management Process
New Exhibit 7-1 on the Human Resource Management
Process
New material on job design added to Human Resource
Requirements
Reduced sub-section on Types of Selection Devices inStaff-
ing the Organization (reviewers found that Exhibit 7-5
sufficiently explained these devices)
Updated Tips for Managers box, which now covers
Behavioural and Situational Questions
Updated and reorganized Compensation and Rewards
Learning Objective #6 now focuses on how Total Re-
wards motivate employees (this change was well received
by reviewers)
New Learning Objective #7 (What can organizations do to
maximize employee relations?)corresponding chapter
sections incorporate some material from the sixth edition
section Current Issues in HRM as well as new and updated
topics on occupational health and safety, corporate wellness
initiatives, sexual harassment, and employee engagement
New EOC material (Networking, 3BL, Business Cases,
revised Becoming a Manager, etc.)
Note: a primary goals for this chapter was to make it more
concise and more relevant to students taking an introductory
overview of management (versus an introductory HR course)
Chapter 8
New material on the difference between managers and
leaders
New material on female leaders
A01_ROBB6929_07_SE_FM.indd Page xii 10/5/12 7:43 PM
xii | PR EFACE
New Tips for Leaders material
New EOC material (Networking, 3BL, Business Cases,
revised Becoming a Manager, etc.)
Chapter 9
New opening case on Yellow House Events
New material on four-drive theory (replaces Job Charac-
teristics Model)
New EOC material (Networking, 3BL, Business Cases,
revised Becoming a Manager, etc.)
Chapter 10
New opening case on Great Little Box Company
New material on what makes up a team and teamwork
New material on turning groups into teams
New EOC material (Networking, 3BL, Business Cases,
revised Becoming a Manager, etc.)
Chapter 11
New opening case on Canadian Curling Association
New EOC material (Networking, 3BL, Business Cases,
revised Becoming a Manager, etc.)
Chapter 12
New opening case on BP
New Learning Objective #4 and corresponding section
onCommon Approaches to Organizational Change
New EOC material (Be the Consultant, 3BL, revised
Becoming a Manager, etc.)
SUPPLEMENTS
For instructors, we have created an outstanding supplements
package, conveniently available online through MyManage-
mentLab in the special instructor area and downloadable from
our product catalogue at www.pearsoncanada.ca.
Instructors Manual (includes video teaching notes, de-
tailed lecture outlines, and suggestions on how to integrate
the MyManagementLab material into your course), pre-
pared by Floyd Simpkins of St. Clair College and Amanda
Bickell of Kwantlen Polytechnic University
PowerPoint Slides, prepared by Floyd Simpkins of St.
Clair College and Amanda Bickell of Kwantlen Polytech-
nic University
MyTest, prepared by Floyd Simpkins of St. Clair College
and Amanda Bickell of Kwantlen Polytechnic University
Video cases (available in DVD format (ISBN 978-0-13-
511763-7) and on the MyManagementLab), prepared by
Sandra Wellman of Seneca College
F-400
ACKNOWLEDGMENTS
A number of people have worked hard to update and enliven this
seventh Canadian edition of Fundamentals of Management. Alex-
andra Dyer was developmental editor on this project. Her under-
standing, patience, helpfulness, support, and organizational skills
made working on this textbook enjoyable and enriching. She also
played a key role in handling many aspects of the editorial work
needed during the production process. Nick Durie, acquisitions
editor, was very supportive of finding new directions for the text-
book. Kathleen McGill, sponsoring editor, continues to be easy to
work with on various projects and is always in the authors corner.
Id also like to thank project manager Marissa Lok, project
editor Rashmi Tickyani, and copy editor Carolyn Zapf, as well
as the many othersproofreaders, designers, permissions
researchers, marketing and sales representativeswho have
all contributed to the transformation of my manuscript into this
textbook and seen it delivered into your hands. The Pearson
Canada sales team is an exceptional group, and I know they will
do everything possible to make the book successful. I continue
to appreciate and value their support and interaction, particu-
larly that of Molly Armstrong, my local sales representative.
Thank you to Floyd Simpkins and Amanda Bickell for
developing new features and resources in MyManagementLab
and making it more integrated with the textbook in this edition,
and to Sandra Wellman for selecting and writing the new video
cases. Finally, I would like to thank the reviewers of this text-
book for their detailed and helpful comments:
J. J. Collins, St. Clair College
Ronald Gallagher, New Brunswick Community College
Cheryl Dowell, Algonquin College
Michael Khan, University of TorontoMississauga
Tim Richardson, Seneca College
Allan MacKenzie, Wilfrid Laurier University
Yan Yabar, Red Deer College
Larry Chung, Camosun College
Halinka Szwender, Camosun College
Al Morrison, Camosun College
Karen Stephens, Camosun College
Troy Dunning, Camosun College
Tim Kemp, Camosun College
Nancy Nowlan, Capilano University
Hana Carbert, CMA-BC
Robert Willis, Vancouver Island University
Michael Pearl, Seneca College
Foster Stewart, SAIT
Horatio Morgan, Ryerson University
Michael Hobeck, Nova Scotia Community College
I dedicate this book to my two sons, Shaun and Isaac.
Ian Anderson
August 2012
A01_ROBB6929_07_SE_FM.indd Page xiii 10/5/12 7:43 PM F-400

About the Authors

STEPHEN P. ROBBINS received his Ph.D. from the University of Arizona. He previ-
ously worked for the Shell Oil Company and Reynolds Metals Company and has taught at
the University of Nebraska at Omaha, Concordia University in Montreal, the University of
Baltimore, Southern Illinois University at Edwardsville, and San Diego State University.
He is currently professor emeritus in management at San Diego State.
Dr. Robbinss research interests have focused on conflict, power, and politics in organ-
izations, behavioral decision making, and the development of effective interpersonal skills.
His articles on these and other topics have appeared in such journals as Business Horizons,
the California Management Review, Business and Economic Perspectives, International
Management, Management Review, Canadian Personnel and Industrial Relations, and The
Journal of Management Education.
Dr. Robbins is the worlds best-selling textbook author in the areas of management
and organizational behavior. His books have sold more than 5 million copies and have been
translated into 20 languages. His books are currently used at more than 1,500 U.S. colleges
and universities, as well as hundreds of schools throughout Canada, Latin America, Aus-
tralia, New Zealand, Asia, and Europe.
Dr. Robbins also participates in masters track competition. Since turning 50 in 1993,
hes won 23 national championships and 14 world titles. He was inducted into the U.S.
Masters Track & Field Hall of Fame in 2005 and is currently the world record holder at
100m and 200m for men 65 and over.

DAVID A. DECENZO (Ph.D., West Virginia University) is president of Coastal Carolina

University in Conway, South Carolina. In his capacity as president, Dr. DeCenzo is respon-
sible for the overall vision and leadership of the university. He has been at Coastal since
2002 when he took over leadership of the E. Craig Wall Sr. College of Business. Since then,
the college established an economics major and developed an MBA program. During that
period, student enrollment and faculty positions nearly doubled. The college also estab-
lished significant internship opportunities locally, nationally, and internationally in major
Fortune 100 companies. As provost, Dr. DeCenzo worked with faculty leadership to pass
a revised general education core curriculum as well as institute a minimum salary level for
the universitys faculty members. Before joining the Coastal faculty in 2002, he served as
director of partnership development in the College of Business and Economics at Towson
University in Maryland. He is an experienced industry consultant, corporate trainer, and
public speaker. Dr. DeCenzo is the author of numerous textbooks that are used widely at
colleges and universities throughout the United States and the world.
Dr. DeCenzo and his wife, Terri, have four children and reside in Pawleys Island,
South Carolina.

MARY COULTER (Ph.D., University of Arkansas) held different jobs including high
school teacher, legal assistant, and city government program planner before completing her
graduate work. She has taught at Drury University, the University of Arkansas, Trinity Uni-
versity, and Missouri State University. She is currently professor emeritus of management
at Missouri State University. Dr. Coulters research interests were focused on competitive
strategies for not-for-profit arts organizations and the use of new media in the educational
process. Her research on these and other topics has appeared in such journals as Interna-
tional Journal of Business Disciplines, Journal of Business Strategies, Journal of Business
Research, Journal of Nonprofit and Public Sector Marketing, and Case Research Journal.
In additional to Fundamentals of Management, Dr. Coulter has published other books with

xiii
A01_ROBB6929_07_SE_FM.indd Page xiv 10/5/12 7:43 PM F-400

xiv | A BO UT T H E AUT H O R S

Prentice Hall including Management (with Stephen P. Robbins), Strategic Management in

Action, and Entrepreneurship in Action.
When shes not busy writing, Dr. Coulter enjoys puttering around in her flower gar-
dens, trying new recipes, reading all different types of books, and enjoying many different
activities with Ron, Sarah and James, Katie and Matt, and especially with her new grand-
daughter, Brooklynn. Love yamy sweet baby girl!

IAN ANDERSON received his Bachelor of Business Administration from the University
of Regina, including studies at the University of Ottawa. Before commencing his college
teaching career, he was the Director of HR for a large Ottawa-based IT company. Ian
is also an HR and Management consultant with Association Management, Consulting &
Educational Services (AMCES) and has been actively consulting for more than 25 years.
At Algonquin College, Ian is a Professor and Coordinator in Marketing and Management
Studies, and coaches students in business case and college marketing competitions.
In Ians other life, he is a Sommelier and works regularly with Groovy Grapes pro-
viding tutored tastings and wine and scotch education. Ians parents, Bob and Katharine,
are from the Niagara area, and Ian has visited wine regions in Australia, New Zealand,
Canada, the United States, Austria, and Germany. Ian has coached hockey and soccer for
more than 20 years.