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What is Organization:
A deliberate arrangement of people to accomplish some specific purpose
• Traditional Org: New Org
• Stable Dynamic
• Inflexible Flexible
• Job focused Skill Focused
• Work defined by job / positions wrk defined for tasks
• Permanent Jobs Temporary Jobs
• Command oriented Involvement oriented
• Mgrs make decisions Employees participate in DM
• Rule oriented Customer Oriented
• Homogenous workforce Heterogeneous Workforce
• Timings 9 to 5 no time limits
• work at organization , specific hrs Work any time, anywhere

Manager:
An organizational member who integrates(assimilate) and coordinates the work of others.

Types of Managers:
• First Line Managers: e.g Supervisors, the lowest level of management
• Middle Managers: e.g All level of Management between the supervisory level and top level of the
organization
• Top Managers: e.g Managers making organization-wide decisions, establishing policies & strategies

Management: The process of coordinating & integrating work activities so that they are completed efficiently and
effectively with and through other people.
• Efficiency:
• The relationship between inputs & outputs, the goal of which is to minimize resource costs.

• Effectiveness:
• goal attainment by “doing the right things”.
• e.g universities are efficient by using computer assisted learning, large lecture classes BUT are the students
educated properly ?

Management Process:
The set of ongoing decisions and actions in which managers engage as they plan, organize, lead and control

• Functions of Management:
• Planning : Define goals, establishing strategy and developing plans to coordinate activities
• Organizing:Determining what needs to be done, how it will be done, and who is to do it
• Leading:Directing & Motivating all involved parties and resolving conflicts.
• Controlling:Monitoring activities to ensure that they are accomplished as planned.

Roles of Management:
• Interpersonal Role:
1- Figurehead ( greeting visitors, signing legal documents )
2- Leader( performing virtually all activities that involve subordinates
3- Liaison(acknowledging mail, doing external board work)
• Informational
1- Monitor: ( maintain personal contacts, read reports)
2- Disseminator: ( holding meetings, making info calls)
3- Spokesperson: ( Holding board meetings, info to media )
• Decisional
• 1- EntrepreneurL organizing strategy and review session for new programs
• 2- Disturbance HandlerL organizing strategy and review sessions that involve disturbance
• 3- Resource AllocationLScheduling, budgeting , job desc etc.
• 4- NegotiatorL union Contracts / conflict resolutions.
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Contingency Approach: An approach that the organization recognizes and responds to situational variables as
they arise.

• Contingency Variables :
1- organization SizeL no of employees 50,000 as compared to 50
2- Routine ness of Task Technology: this requires leaderships styles , org structure and control system diff from non
routine technologies.
3- Environmental Uncertainty: caused by political, technological, economic changes influence management
process.
4- Individual Differences: indv needs are important when managers select motivation techniques, leadership styles
and job designs.

Quantative Approach: The use of quantative techniques to improve decision making.

This includes :
• Application of statistics;
• Optimization Models;
• Information Models;
• Computer Simulations. e.g Linear Programming is used to improve resource allocation decisions

1- Classical Approaches: The classical period extended from mid- 19th century through the early 1950s. These
included : systematic management, scientific management, administrative management, human relations and
bureaucracy.

• Systematic Management (Adam Smith)

• Careful definition of duties & responsibilities
• Standardized techniques for performing these duties
• Specific means of gathering, handling, transmitting and analyzing information
• Cost accounting, wage and production control systems to facilitate internal coordination and communication.

• Scientific Management: Frederick Taylor)

• Analyze work using scientific methods to determine one best way to complete production tasks.
• Emphasized study of tasks, selection & training of workers, cooperation between workers & management.
• Improved factory productivity and efficiency
• Introduced scientific analysis to workplace. ( 20 minutes flywheel assembling changed into 5 minutes
duration.
• Excluded senior management tasks
• Ignored relationship between the organization and its environment.
Administrative Management: (Henri Fayol) introduced fourteen principles of management.
1- Division of Work: divide work into specialized task and assign responsibilities to specific individuals
2- Authority: delegate authority along with responsibility
3- Discipline: make expectations clear and punish violations
4-Unity of Command: each employee should be assigned to only one supervisor
5-Unity of Direction: employee’s effort should be focused on achieving organizational objectives
6- subordination of individual interest to general interest: The general interest must predominate
7-Remuneration: systematically reward efforts that support the organizations direction.
8-Centralization: determine the relative importance of superior and subordinate roles
9-Scalar Chain: keep communications within the chain of command
10-Order: order jobs and material so they support the organization’s direction.
11-equity: Fair discipline and order enhance employee commitment
12-Stability & tenure of Personnel: promote employee loyalty and longevity.
13-Initiative: encourage employees to act on their own in support of organization’s directions
14-Espirt de Corps: promote unity of interests between employees & management.

Human Relations: (1930s) 1-productivity & employee behavior are influenced by informal work group
2- Cohesion, status, and group norms determine output. Managers should stress employee welfare, motivation and
communication
3- Social needs have precedence over economic needs
4- psychological & social processes influence performance
5-happy workers are always more productive.
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Bureaucracy:
• Structured formal network of relationships among specialized positions in an organization
• Rules and regulations standardize behavior
• Jobs staffed by trained specialists who follow rules
• Hierarchy defines the relationship among jobs
• Promotes efficient performance of routine organizational activities
• Eliminate subjective judgment by employees and management
• Emphasize position rather than the person
• Limit organizational flexibility and slow decision making
• Ignore the importance of people and interpersonal relationships
• Difficult to dismantle once established

Contemporary Approaches: these include quantitative management, organizational behavior, systems

theory and contingency perspective.
• Quantitative Management: Developed specific mathematical methods of problem analysis. (statistical
decision, simulation, forecasting )
• Helped managers to select the best alternative among a set
• Model neglects nonquantifiable factors.
• Managers not trained in these techniques may not trust or understand the technique’s outcomes
• Not suited for non routine or unpredictable management decisions
• Organizational Behavior: Promotes employee effectiveness through understanding of individual, group and
organization processes.
• Stresses relationships among employees, managers and the work they perform for the organization
• Assumes employee want to work and can control themselves
• Increased participation, individual challenge & initiative
• Recognized the importance of developing human resources
• Contingency Perspective:
• Situational contingency influence strategies, structures and processes that result in higher performance
• There is more than one way to reach a goal
• Managers may adapt their organizations to the situation
• Argument against Universal principles of management
• Theory may not be applicable to all managers

1- Characteristics of managerial Decisions.

These include : Lack of Structure, Risk, , Uncertainty and conflict.
• Lack of structure: These also include :
• Programmed decisions:
• Decisions encountered and made before, having objectively correct answers, and solvable by using simple
rules, policies, or numerical computations. e.g. university requirement of GPA for GAS. Merit system for
promotion of employees in govt.
• Non-programmed Decision: these are new, novel, complex decisions having no proven answers. E.g
diversification into new products & markets, purchase of experimental equipments
• Uncertainty: this includes:
• Certainty: the state that exists when decision makers have accurate and comprehensive information.
• Uncertainty: the state that exists when decision makers have insufficient information.
• Risk: the state that exist when probability of success is less than 100 percent
• Conflict: These are opposing pressures from different sources. Two levels of conflicts are psychological
conflict and conflict that arises between individuals & groups. E.g conflict arises to managers when several
options are available. The second level is that when GM marketing proposes to lessen the cost whereas the
CEO wants to introduce another product .

The stages of Decision Making : These include:

1-identifying and diagnosing the problem.
e.g. if the Sales Manager knows that the SALES of a particular brand has dropped drastically . What could be the
reasons for that ? Economy, competitor, salesmen etc.
a- is there a difference between what is actually happening and what should happen ?
b- how can we describe deviation, as specifically as possible?
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c- what is the cause of deviation?
d- what specific goals should be met?
e- which of these goals are critical to the success of decision.
2- Generating alternative solutions: these include:
A- ready-made solutions: these are ideas that have been seen or tried before .
B- Custom made solutions: these are combination of ideas into new, creative solutions. E.g NOKIA with radio FM
3- Evaluating Alternatives:
a- is our information about alternatives complete & current? If not can we get more info?
b- does the alternative meet our primary objective?
c- what problems could occur if we implement the current alternative ?
Contingency plans : these are alternative courses of action that can be implemented bases on how the future
UNFOLDS? E.g what economic scenario is unfolding ? What are important current events and trends ? What
scenarios could EVOLVE six years from now? How will you prepare?
4- Making the Choice: This includes:
To- Maximize: a decision realizing the best outcome. This requires searching thoroughly for a complete range of
alternatives, carefully assessing each alternative, comparing one to another and choosing or creating the very best.

• Satisfice: to choose an option that is acceptable, although not necessarily the best or perfect.
• Optimizing: Achieving the best possible balance among several goals. E.g if we want to purchase a product and
interested in quality, durability and price. We may go for the expensive one because of its combine attributes .

5- Implementing the Decision:

A- determine how things will look when decision is fully operational.
B-a flow diagram, the steps necessary to achieve a fully operational decision
C- list the resources and activities required to implement each step?
D- estimate the time needed for each step
E-assign responsibility for each step to specific individuals
There is a need to identify the potential problems and identify potential opportunities these include:
A- what problems could this action cause?
B- what can we do to prevent the problems?
C- what unintended benefits or opportunities could arise?
D-how can we make sure they happen?
E- how can we be ready to act when opportunities come?

Worse off than before : A case study to know that decision may fail to thoroughly forecast consequences of
solutions, fail to think carefully about implementation, contingency planning etc.

• Plan is to reduce the noise and air pollution that has occurred due to volume of traffic .
• It was decided that the speed limit of every vehicle will be lowered to 20 km/h
• The concrete bump (jumps) were installed to prevent cars from exceeding speed limit.
» RESULTS !!
• The lower speed- car in second gear- produce more noise- produce more exhaust.
• Shopping trips usually took 20 minutes NOW take 30 minutes- number of cars at a given time increased .A
Traffic jam

• The daily sales of the shopping malls and stores reduced due to the reason that people started shop from other
parts of the city---resulted in low income-----resulted in downsizing--------.

6-Evaluating the Decision: This means collecting the information on how well the decision is working.

• Quantifiable Goals: a 20 percent increase in sales

» A 95 percent reduction in accidents
» 100 percent on time deliveries
» Decision evaluation is useful whether the feedback is positive or negative. Feedback that suggests the
decision is working implies that the decision should be continued and perhaps applied elsewhere in the
organization.
» Negative feedback indicating failure means :
» A- implementation will require more time, resources, effort or thought
» B-the decision was a bad one.
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Barriers to effective decision making:
These include: psychological biases, time pressures and social realities.
• 1-psychological Biases; these include:
• A- illusion of Control: people’s belief that they can influence events, even when they have no control over
what will happen.
• B- Framing Effects: a psychological bias influenced by the way in which a problem or decision alternative is
phrased or presented. e.g managers intend to invest more money in a course of action that resulted 70 percent
chance of profit.
• C- Discount the future: a bias weighting short term costs and benefits more heavily than long term costs and
benefits. E.g visiting a doctor for dental checkup.
• 2- Time Pressures:
• Can managers under time pressure make timely and high quality decision?
• 3- Social Realities:
• Important managerial decisions are marked by conflict among interested parties. Therefore many decisions
are result of intensive social interactions, bargaining .

Managing Group Decision Making: these include : an appropriate leadership styles, constructive use of
disagreement and conflict, the enhancement of creativity.

Managing Group Decision Making: these include : an appropriate

leadership styles, constructive use of disagreement and conflict, the
enhancement of creativity.

Leadership
Avoid domination
Encourage input Constructive Conflict
Avoid groupthink (when members avoid Air legitimate differences
disagreement) and satisficing Stay task related
(choose first available option due
Be impersonal
to laziness)
Remember goals. Play devil's advocate
(criticizing ideas
to ensure that
diff viewpoints have
Effective group been explored)
Decision making

Creativity
Brainstorm
Avoid criticizing
Exhaust ideas
Combine ideas

Organizational Decision Making: To understand DM in organizations, Managers must consider : 1-

constraints faced by Decision makers, 2- organizational decision process, 3- negotiations and politics, 4- decision
making during crisis and emergent strategies.

• 1- constraints faced by Decision makers: e.g financial, legal, market, human and organizational.
• 2- Organizational decision process: these include models of : bounded rationality, incremental model,
coalitional model and garbage can model.
• Bounded rationality: decisions makers cannot be truly rational because:
• A- they have imperfect and incomplete information about alternatives and consequences
• B-the problems they face are complex
• C-human beings simply can’t process all information to which they are exposed
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• D-No enough time to process all relavant information
• E- people, including same managers in the same firm have conflicting goals
• Incremental Model: in this model major solution arise through a series of smaller decisions. E.g budget of
2005-6 to 2006-07
• Coalitional Model: in this model groups with differing preferences use power and negotiations to influence
decisions.
• Garbage Can Model: in this model people are not sure of their goals, or disagree about goals or are unsure of
what to do.
3- negotiations & politics: e.g decisions which include pay raise, promotion and budgets are made on the basis of
politics.
People try to influence organizational decisions to their own interests and also use power to pursue hidden agendas
which reduces decision making effectiveness.
There is a need to make decision making process “collaborative” than competitive.

• 4- Decision Making in a CRISIS: an effective plan for CRISIS MANAGEMENT should include the
following elements:
1. Strategic actions such as integrating CM (crisis management) into strategic planning
2. Technical & structural actions e.g creating a CM team, and dedicating a budget to them
3. Evaluation of Diagnostic actions e.g audit of threats and liabilities, environmental impact audits, establish
tracking system for early warnings
4. Communication actions e.g provide training for dealing with MEDIA , local communities etc
5. Psychological & cultural Actions: showing a strong top management commitment to CM and providing
training & psychological support regarding human and emotional impact of crisis.
5- Emergent Strategies: it is the strategy that organization “ends up” pursuing, based not solely on what was
originally planned and attempted but also on what actually evolves from all activities engaged in by people throughout
the organization.

1- Planning :A process that involves defining the organization’s goals. Establishing an overall strategy for achieving
those goals and developing a comprehensive set of plans to integrate and coordinate organizational work.

• Why do managers plan?

• Planning gives direction to managers;
• it reduces the impact of change and develop appropriate response;
• managers plan in order to anticipate changes and develop the most effective response to them.
• Planning reduces overlapping and wasted activities and inefficiencies can be overcome or minimize.
• Planning establish goals or standards that are used in controlling ; there is a comparison of performance
desired and performance achieved ; there is an identification of the deviations and an appropriate corrective
actions .
• Planning & Performance ?
• Formal planning is associated with high profits,higher return on assets;
• The quality of planning process and appropriate implementation of plans contribute more to high performance
than does the level of planning.
• Planning/ performance relationship is influenced by planning time frame. Organizations need at least four
years of systematic formal planning before performance is impacted.

How do managers plan ? Goals : Desired outcomes for individuals, groups or entire organizations. . Goals are
objectives and provide direction for all managerial decisions. :

Plans : Plans are the documents that outline how goals are going to be met , including resource allocation, schedules,
and other necessary actions to accomplish goals/ objectives
Types of Goals:

Stated Goals:
Financial Objectives: Strategic Objectives:
Faster revenue growth: A bigger market share
Faster earning growth A Higher , more secure industry rank
Higher dividend (bonus/ extra payment) Higher product quality
Wider profit margins Lower cost relative to key competitors
High Return on invested capital Broader or more attractive product line

Stronger bond and credit ratings
Bigger Cash Flows
A more diversified revenue base
Stable earning during recession( slump)
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A stronger reputation with customers
Superior customer services
increased ability to compete in int’l markets
expanded growth opportunities

Real Goals:
Goals that an organization actually pursues, as defined by the actions of its members

Types of Plans: These include:

Breadth Time Frame Specificity Frequency of use
Strategic Long term Directional single use
Operational Short Term Specific Standing

• Strategic Plans: Plans that apply to entire organization, establish the organization's overall goals and seek to
position the organization in terms of its environment. These also include formulation of goals.
• Operational Plans: Plans that specify the details of how the overall goals are to be achieved. These also
include short time periods, monthly, weekly and day to day .
• Long term Plans: Plans with a time frame beyond three years.
• Short term Plans: Plans covering one year or less
• Specific Plans: Plans are clearly defined and that leave no room for interpretation. E.g sales targets
• Directional Plans Plans that are flexible and that set out general guidelines. These provide focus but donot
lock managers into specific goals or courses of action.
• Single use Plans A one- time plan specifically designed to meet the needs of a unique situation.
• Standing Plans These are ongoing plans that provide guidance for activities performed repeatedly,. These
include policies, procedures rules etc.
• Traditional Goal Setting:
• An approach to setting goals in which goals are set at the top level of the organization and then broken down
into sub goals for each level of the organization. Goals that are established and passed down to each
succeeding level of organization serve to direct and guide and in some ways constrain , individual employee’s
work behavior.

Management By Objectives (MBO):

A management system in which specific performance goals are jointly determined by employees and their managers.
Progress towards accomplishing these goals is periodically reviewed and rewards are allocated on the basis of the this
progress.

Steps in MBO program

1. The organization’s overall objectives and strategies are formulated
2. Major objectives are allocated among divisional and departmental units
3. Unit managers collaboratively set specific objectives for their units with their managers
4. Specific objectives are collaboratively set with all department members
5. Action plans, defining how objectives are to be achieved, are specified and agreed upon by managers and
employees
6. The action plans are implemented
7. Progress towards objectives is periodically reviewed, and feedback is provided
8. Successful achievement of objectives is reinforced by performance based rewards.
Characteristics of Well Designed Goals
• Written in terms of outcomes rather than actions
• Measurable and quantifiable
• Clear as to a time frame
• Challenging yet attainable
• Written down
• Communicated to all necessary organizational members .
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Strategic Management :
The art & science of formulating, implementing and evaluating cross functional decisions that enable organization to
achieve its objectives.

• This means, strategic management focuses on integrating management , marketing, finance/ accounting,
production, / operations , research , development and computer information systems to achieve organizational
success.
• the term Strategic Management is synonym of strategic planning.

• The notion of strategic management is to achieve and maintain competitive advantage.

Stages of Strategic Management Process:

Strategy Formulation, Strategy Implementation and Strategy Evaluation.
Strategy Formulation:
• developing a vision and mission,
• identify organization’s external opportunities and threats
• determining internal strengths & weaknesses,
• establishing long term objectives,
• generating alternative strategies
• choosing particular strategy to pursue.
Strategy Implementation :
establish annual objectives;
devise policies
motivate employees
allocate resources
preparing budgets
re-directing marketing efforts

Strategy Evaluation:
1-reviewing internal & external factors basis for current strategies
2-measuring performance
3-taking corrective actions.

• What is External Opportunity and Threat?

• These refer to economic, cultural, social demographic, political, legal, technological and competitive trends and
events that could significantly benefit and harm an org in future.. e.g wireless revolution, mobile revolution,
biotechnology, population shifts, changing work values, attitudes
• What is Internal Strength & Weaknesses:
• These are organization’s controllable activities . e.g marketing, finance/ accounting, production, / operations ,
research , development and computer information systems to achieve organizational success
• What is Long Term Objectives?
• This refers to specific results that an organization seeks to achieve in pursuing its basic mission. Objectives
should be challenging, measurable, consistent, reasonable and clear.
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The Strategic Management Model:

Perform External Audit

Generate Implement
Dev Vision Estab
Evaluate implement Strategies Measure &
& Mission Statements Long Term
Select strategies Marketing, evaluate
Obj performance
Strategies MGMT Issues Fin, R&D
MIS

Perform
Internal Audit

Strategy
Strategy Implementation Strategy Evaluation
Formulation

Benefits of Strategic Management:

1- Financial Benefits:
• e.g significant improvement in sales, profitability( prosperity, success), and productivity.
• Preparation for future fluctuations in internal & external environments
2- Non Financial Benefits:
• An improved understanding of competitors strategies
• increased employee productivity
• understanding of performance – reward relationship
• efficient & effective managerial system
• Identification, prioritization & exploration of opportunities
• Objective view of management problems
• improved coordination & control of activities
• effective allocation of time & resources
• internal communication among personnel
• encourages forward thinking
• encourages favorable attitude towards CHANGE
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Organizational structure: The formal framework by which jobs tasks are divided, grouped and
coordinated
Organizational Design: a process that involves decisions about :
1-Work Specialization 2- Departmentalization 3- Chain of command 4- Span of control 5-
Centralization & Decentralization 6- Formalization.

1- Work Specialization: \the degree to which tasks in an organization are divided into separate jobs , also
known as division of labor. An entire job is not done by an individual but instead it is broken into
steps and each step is completed by different person. E.g MacDonald's uses High Work
specialization to efficiently make and sell its fast food products, similarly most employees in
Health care Organizations are specialized.
2- Departmentalization: The basis by which jobs are grouped together. These include:
A- functional departmentalization: ( Groups jobs by Functions Performed)
B- Geographical Departmentalization: ( groups jobs on the basis of territory)
Plant Manager

Manager Manager Manager Manager Manager

Engineering Accounting manufacturing Human Resource Purchasing

Vice President
For Sales
Sales Director Sales Director Sales Director
Central Region North Region South
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C- Process Departmentalization: group jobs on the basis of product or costumer flow:

Plant Manager

Planing & milling AssembDeptt Finishing Inspection &

Sawing Dept Shipping Mgr
Manager Deptt Mgr Mgr Deptt Mgr

D- Product Departmentalization: Groups Jobs by Product Line. In this approach, each major product area is placed under
authority of a manager who is specialist in and responsible for everything related with the product line.

E- Customer Departmentalization: Groups jobs on the basis of common customers.

Director
Sales

Manager Manager Manager

Retail A/cc Wholesale A/c Govt A/c

3- CHAIN of Command: it is the continuous line of authority that extend from upper organizational levels to lowest
organizational levels and clarifies who reports to whom ?
a- Authority: the rights inherent in a managerial position to tell people what to do and to expect them to do .
b- Responsibility: The obligation to perform any assigned duties.
c- Unity of Command: The management principle that each person should report to only one manager.
4- SPAN of CONTROL: The number of employees a manager can efficiently and effectively manage.

5- Centralization: the degree to which decision making is concentrated at a single point in an organization.
6- Decentralization: \the degree to which lower level employees provide input OR actually make decisions.

Factors that influence centralization & de centralization

• More centralization More De centralization
• Environment is stable Environment is complex , un certain
• Lower level manager no capable for decision Lower level managers are capable & experienced
• Lower Level managers don’t want to participate Lower level managers want to participate
• Decisions are significant Decisions are minor
• Company is Large company is geographically dispersed

7- Formalization: The degree to which jobs within the organization are standardized and the extent to which employee
behavior is guided by rules and procedures. An organization which is less formalized E.g at a newspaper publisher,
news reporter often have a great deal of discretion of their jobs, they may pick their news topic, find their own stories ,
research them they way they want and write them up whereas on the other hand the composers and typewriters don't
have that type of “freedom” and have constraints of both Time and Space.

COMMON ORGANIZATIONAL DESIGNS

1- Traditional Organizational Designs: these include: simple structure, functional structure, and divisional structure.
A- Simple Structure: an organizational design with low departmentalization, wide spans of control, centralized
authority and little formalization.
Strengths: Fast, Flexible, in expensive to maintain, clear accountability
Weaknesses: not appropriate as organization grows, reliance on one person is risky
B- Functional Structure: An organizational Design that groups similar or related occupational specialties together.
E.g Departmentalization
Strength: Cost saving advantages: (minimal duplication of people & equipment)
Weakness: Pursuit of functional goals can cause managers to loose sight of what is best for overall organization,
functional specialists have little understanding of what other units are doing?
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C- Divisional Structure: An organizational structure made up of separate, semiautonomous units or divisions.
Strengths: Focus on results- division managers are responsible for what happens to their products & services
Weaknesses: Duplication of activities and resources increases costs and reduce efficiency

2- Contemporary Organizational Designs: These include:

A- Team based structure: an organizational structure in which the entire organization is made up of work groups or
teams.
B- Matrix Structure: an organizational structure that assigns specialists from different functional departments to
work on one or more projects. It creates dual chain of command.
C-Autonomous Internal Units: These are separate decentralized business units, each with its own products, clients,
competitors and profit goals. As compared to divisional structure, there is no centralized control or resource allocation
D-Boundary less Organization: An organization whose design is not defined by or limited to, the horizontal, vertical
or external boundaries imposed by a pre defined structure. These organizations seeks to eliminate the chain of
command, and have appropriate span of control..
Organizational Change: Any alterations in people, structure or technology.
FORCES for Change:

1- External Forces: e.g a- Governmental laws & regulations. E.g re-building accommodations for special persons
b-Technology: e.g greeting e cards, emails and internet etc. C- Economic Changes: Global recession puts on more
pressure on the organizations to be more cost- efficient, change in the currency rates and intersts rate lead to
organizational change.
2- Internal Forces: a- Workforce: changes in terms of age , education , experience etc to achieve certain objectives of a
department. Changes in compensation and benefits may be required to retain the experienced managers. B-
Equipment: There could be a need to change the old equipment with the new one and also a training of the existing
employees for using new equipment. C- Employees Attitude: e.g job dissatisfaction may lead to absenteeism,
voluntary resignations and strikes etc.
3- The Manager as Change Agent: Change agents: people who act as a catalyst and assume the responsibility for
managing the change- process.
TYPES OF CHANGE:
1- Changing STRUCTURE: these include: work specialization, departmentalization, chain of command, span of
control, centralization, formalization, job re design or actual structural design( mergers ; cross functional teams etc)
2- Changing TECHNOLOGY: These include : Work Processes, methods and equipment. E.g automation,
computerization etc.
3- changing PEOPLE: these include expectations, perceptions and behaviors. E.g respect for employees, trust and
support , the sharing of power and participation.
Managerial Actions to reduce Resistance to CHANGE:

• Education & Communication: communicate with employees to help them see the logic of change
• Educate employees through one on one discussions, memos, group meetings or reports.
• To take appropriate measure if source if resistance is either poor communication or misinformation.
• To build mutual trust and credibility between managers and employees
• Participation: allows those who oppose to change to participate in decision
• Assume that they have expertise to make meaningful contributions
• Involvement can reduce resistance, obtain commitment to see change succeed and increase quality of change
decision
• Facilitation and Support: provide supportive efforts e.g employees counseling therapy, new skills training or
short paid leave
• Negotiation : Exchange something of value to change resistance
• May be necessary when resistance comes from a powerful source
• Manipulation and Cooptation: manipulation such as twisting or distorting facts, withholding damaging
information or creating false rumors
• Cooptation is a form of manipulation and participation
• Coercion: using direct threats or force

Stress: A dynamic condition a person faces when confronted with an opportunity, constraint or demand related to what
he desires and for which the outcome is perceived to be both uncertain and important.
Regardless of condition a stressful condition exists only when there is doubt or uncertainty regarding whether the
opportunity will be seized, whether the constraint will be removed or whether the loss will be avoided.
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Causes of stress: Psychological Symptoms: job related, dissatisfaction, tension, anxiety, irritability boredom and
procrastination (delay, postpone).
Physiological Symptoms: Changes in metabolism, increased heart & breathing rates, raised blood pressure, headaches,
and potential of heart attacks.
Behavioral: Changes in productivity, absenteeism, job turnover, changes in eating habits, increased smoking or
consumption of alcohol , rapid speech, sleep disorders

CREATIVITY: The ability to combine ideas in a unique way or to make unusual associations between ideas. E,g an
organization that stimulates creativity develops unique ways to work / solutions to problems.
INNOVATION: The process of taking a creative idea and turning it into a useful product , service or work method.
INNOVATION VARIABLES
Structural Variables: Organic structures: e.g org with low formalization, centralization & work specialization
Abundant Resources e.g easy availability of resources mgrs can afford the cost of innovations and can absorb
failures.
High Interunit Communication: e.g cross functional teams , task forces etc

2- Cultural Variables: a- Acceptance of Ambiguity: too much emphasis on objectivity and specificity constrains
creativity.
b- Tolerance of Impractical: individuals who offer impractical, even foolish answers to what if questions are not
stifled (not practical)

• c-Low External Controls: e.g rules, regulations, policies and similar organizational controls.
• d- Tolerance of Risk: Employees are encouraged to experiment without the fear of consequences if they fail.
Mistakes are treated as learning opportunities.
• e- Tolerance of Conflict: diversity of opinions is encouraged.
• f-Focus on Ends rather than Means: Goals are made clear, and individuals are encouraged to consider
alternative routes toward meeting the goals.
• g- Open system focus: managers closely monitor the environment and respond to changes as they occur.
• 3- Human Resource variables:
• A- High Commitment to Training & Development:
• B- High Job Security:
• Creative People:
• IDEA CHAMPION: individuals who actively and enthusiastically support new ideas, build support, overcome
resistance and ensue that innovations are implemented.

Leader: Someone who can influence other and has managerial authority.

Leadership: The process of influencing a group toward the achievement of goals.

Trait Theories Associated with Leadership:
Traits – characteristics that might be used to differentiate leaders from non leaders. These are six traits :
1- Drive: leaders exhibit a high effort level. They have high desire for achievement. They are ambitious, have lot of
energy show initiative and are persistent.
2- Desire to Lead: Leaders have strong desire to influence and lead others. They demonstrate the willingness to take
responsibility.
3-Honesty & Integrity: Leaders build trusting relationships between themselves and followers by being truthful and by
showing high consistency between word and deed.
4- Self- confidence: Followers look to leaders for an absence of self-doubt. Leaders show self confidence in
convincing the followers of their rightness of goals and decisions.
5- Intelligence: Leaders need to be intelligent enough to gather, and interpret large amount of information, they need
to be able to create visions, solve problems and make correct decisions.
6- Job- relevant Knowledge: Effective leaders have a high degree of knowledge about the company, industry and
technical matters. In depth knowledge allows leaders to make well- informed decision and to understand the
implications of those decision.
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Behavioral Theories:
Leadership Theories that identified behaviors that differentiated effective leaders from in effective leaders
These include:
1- Autocratic Style: A leader who tended to centralize authority, dictate work methods, make unilateral decisions, and
limit employee participation.

2- Democratic Style: A leader who tended to involve employees in decision making, delegate authority, encourage
participation in deciding work methods and goals and use feedback as an opportunity for coaching employees.

3- Lazissez- Faire Style: A leader who generally gave the group complete freedom to make decision and complete the
work in whatever way it saw fit.

4- Initiating Structure: The extent to which a leader was like to define and structure his role and the role of group
members in the search for goal attainment.

5-Consideration: The extent to which a leader had job relationships characterized by mutual trust and respect for
group members , ideas and feelings.

6- high- High Leader: A leader high in both initiating structure and consideration behaviors.

CONTINGENCY THEORIES OF LEADERSHIP

1- Fiedler Contingency Model: A leadership theory that proposed that effective group performance depended on the
proper match between a leader’s style of interacting with his follower and the degree to which the situation allowed
the leader to control and influence.
2- Least Preferred Co Worker Questionnaire: A questionnaire that measured whether a leader was task or relationship
oriented.
3- Leader Member Relations: This describes the degree of confidence, trust and respect employees had for their
leader.
4- Task Structure: The degree to which job assignments were formalized and procedures.
5- Position Power: The degree of influence a leader had over power-based activities such as hiring, firing, discipline,
promotions and salary increases.

PATH GOAL THEORY

• Directive Leader: Lets subordinates know what is expected of them, schedules of work to be done and give
specific guidance how to accomplish tasks.
• Supportive Leader: Is friendly and shows concern for needs of followers
• Participative Leader: Consult with group members and uses their suggestions before making a decision
• Achievement Oriented Leader: sets challenging goals and expects followers to perform their highest level.
• TRANSFORMATIONAL – TRANSACTIONAL LEADERSHIP
• Transactional Leaders: Leaders who guide or motivate their followers in the direction of established goals by
clarifying role and task requirements.
• Transformational Leaders: Leaders who provide individualized consideration, intellectual stimulation and
possess charisma.
• Charismatic Leader: An enthusiastic , self confident leader whose personality and action influence people to
behave in certain ways.
• Visionary Leadership: The ability to create and articulate a realistic, credible and attractive vision of the future
that improves upon the present situation.

LEADER AND POWER:

Legitimate Power: \the power a leader has as a result of his position in the organization
Coercive Power: The power a leader has because of his ability to punish or control

• Reward Power: The power a leader has because of his ability to give positive benefits or rewards

• Expert Power: Influence that is based on expertise, special skills or knowledge

• Referent Power: power that arises because of a persons desirable resources and personal traits.

• Empowerment: Increasing the decision making discretion of workers

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Formal Group:
A designated Work group defined by organization's structure.e.g Six members in Flight Crew.
• Informal Group: A group that is neither formally structured nor organizationally determined, appears in
response to the need of social contact. E.g employees from diff deptt at lunch time.
• Command Group: A manager and his immediate subordinates. E.g sales manager, his team
• Task Group: Those working together to complete a job task.e.g disp Action committee
• Interest Group: working together to attain a specific objective with which each is concerned.
• Friendship Groups: those brought together because they share one or more common characteristics.e.g e-mail
research groups

Stages of Group Development:

• Forming: the first stage in group development, characterized by much uncertainity about groups purpose,
structure & leadership.
• Storming: The second degree in group development, characterized by intra group conflict,means members
accept the existence of group, but conflict regarding it’s controlling etc.
• Norming: Third stage in group development, characterized by close relationships 7 cohesiveness(). There is
strong sense of group identity& common set of expectations.
• Performing: The fourth stage in group development. When the group is fully functional.group members has
started to know each other to perform the task.
• Adjourning: The final stage in GD for temporary groups, characterized by concern with wrapping up
Activities rather than Task performance.

Why do people join groups?

• Security: people feel stronger, have fewer self doubts & more resistant to threats.
• Status: Joining a group may be viewed by others as “status” and have recognition. E.g Islamabad Club
membership etc
• self esteem: Groups can provide people with feelings of Self Worth. E.g diner’s club etc
• Affiliation: Groups fulfill social needs. people have regular interaction with other members etc.
• Power: something may not be achievable being individual but may be while in a group. means power in
numbers.
• Goal Achievement. E.g formal groups to accomplishment of certain goals which require skills, knowledge,
talent etc.
• Group Behavior Model:
• A-External Conditions Imposed on Group:
• 1-Organization Strategy: This includes organization’s goals, reducing costs, improving quality, expanding
market share. The strategy that an organization is following will INFLUENCE the power of various work
groups, which inturn the Top management determines ALLOCATION of resources for performing it’s
TASKS. E.g in case of low sales….results in members anxiety, intragroup conflicts etc.
• 2-Authority Structures: Defines Who reports to Whom, who make decisions, formal leader of group, formal
relationship b/w groups.

3-Formal Regulations: organizations create Rules, procedures, Policies, Job Descriptions to standardize employees
behavior. E.g KFC, taking orders, cooking burgers, filling Pepsi etc.

4-Organizational Resources: Employees have high quality tools & equipment to do their jobs + money, time .e.g
DHL, Citibank employees etc.

• 5-Human Resource Selection Process: criteria that an organization uses in its selection process will determine
the kinds of people that will be in it’s work group. E.g COMSATS , diff department etc.
• 6- Performance Evaluation & Reward System: Does organization provide employees with challenging
specific performances? Behavior of groups in an org will be influenced by it’s evaluation & reward policies.
• 7-organizational Culture: A standards of acceptable and unacceptable Behavior of employees in an org.
Importance of honesty, values that organization holds.
• 8-Physical work Setting: Physical lay out of an employees work space, the arrangement of equipment, and
friendly environment etc.
• B-Group Member Resources:
Abilities set the parameter for what members can do & how effectively they will perform in a group
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• 1-Abilities: Individual who hold crucial abilities for attaining group’s task tend to be more involved in group
activity., they contribute more, more likely to emerge as group leaders & satisfied if their “talent” are utilized
by the group.
• 2- Personality Characteristics: Positive characteristics related to group productivity. Group members are
energetic, competitive, goal oriented, sociable, self reliant & independent

C- Group Structure: Groups have structure that shapes the behavior of members& makes it possible to explain &
predict a large portion of individual behavior within a group as well as performance of group it self.

• 1- Formal leadership: e.g Sales manager, Supervisor, Chairman play important role in group’s success.
• 2-Role: A set of expected behavior patterns attributed to someone occupying a given position in a social unit.
E.g managerial roles by sales manager, marketing roles, company’s spokesperson, behavior of SM varies
with different roles he plays.
• Roles also include:
• Role Identity: certain attitudes & behaviors consistent with a role: as per situations.
• Role perception: An individual’s view of how he is supposed to act in a given situation. We get stimuli from
friends, books, movies , televisions etc.
• Role expectations: How others believe that a person should ACT in a given situation. E.g role of president of
pakistan refers to dignity, whereas role of wasima kram refers to dynamic, aggressive &inspiring for his team
members.
• Role Conflict: This includes situations in which two or more role expectations are mutually contradictory. E.g
dissonance as plant manager etc.
• 3-Norms: acceptable standards of behavior within a group that are shared by the group’s members.
• Formalized Norms: Organizational manuals setting out rules & procedures for employees to follow.
• Informal Norms:e.g we don’t discuss previous job details, difficulties in working with others in an interview.

Common Classes of Norms Include:

a- Performance Norms: Work Groups typically provide their members as How Hard they should work, how to get the
job done, their level of output etc. to affect individual’s performance.
b- Appearance Norms: includes appropriate dress, loyalty to work group/organization, when to look busy etc.
c-Social arrangement Norms: social interactions e.g Lunch hours, social games , on & off job activities.

• D- Allocation of Resources Norms: e.g pays, assignment of difficult jobs, allocation of new tools etc.
• Reference Groups: Important groups to which individuals belong or hope to belong & with whom’s norms
individuals are likely to conform.
• 4- Status: A socially defined position or rank given to groups or group members by others.
• Status is an important factor in understanding human behavior because it is significant motivator & has major
behavioral consequences when individuals perceive a disparity() b/w what they believe their status to be &
what others perceive it to be..e.g professors in a university ….
• E.g Business Exec. May use personal income as determinant of their status, Government Bureaucrats may use
size of their Budgets, professional employee may use degree of autonomy with their job assignment.
• 5- Size: size of group affect’s overall behavior of the group.
• Large groups are good for gaining diverse inputs e.g fact findings BUT smaller groups are better at doing
something productive with that input.
• Groups made up of 5to 7 members do a better job.
• Social Loafing: is the tendency for individuals to expend less effort when working collectively than when
working individually. In fact in a research in comparison with US employees , chinese & israelis actually
performed better in a group than working alone.

6- Composition: composition of a group is an important predictor of turnover. E.g nine female manager & 1 male
manager
• A-Group Demography: Degree to which members of a group share a common demographic attribute, such as
age, sex, race, educational level, or tenure and the impact of this attribute on turnover.
• E.g heterogeneous gender, personality, opinion, abilities, skills & perspectives) groups perform more
effectively than homogenous.
• B- Cohorts: Individuals who as a part of a group, hold a common attribute.
 17
• E.g people born 1970, shared common experiences about revolutions / information's. + Pepsi cola
international marketing team(all young)….youthful cohorts , who have passion for change, can embrace risk,
act quickly, innovate constantly and not afraid of breaking rule’s of international softdrink marketing

• 7- Cohesiveness: Degree to which group members are attracted to each other & are motivated to stay in the
group.
• If performance related norms are high (high output, quality work, cooperation with in div outside the group) a
cohesive group will be more productive than a less cohesive group.
• If cohesiveness is high BUT performance norms are low, productivity is LOW.
• If cohesiveness is LOW & performance Norms are high, productivity increases but less than as compared to
high cohe-high perf- norm
• If cohesiveness & performance- norms are low, they will tend to fall in low to moderate range of productivity.
• How to encourage group cohesiveness?
• 1- Make group smaller. 2-Encourage agreement with group goals.
• 3-increase time members spend together. 4-Increase status of group
• 5-Stimulate competition with other groups..6-Give rewards to groups rather than indiv :7-Physically isolate
the group.

E-Group Tasks:
The impact of group processes on group’s performances member satisfaction is also moderated by the TASKS that
group is doing.
Simple Tasks = routine & standardized
Complex Tasks= high uncertainty/more discussions/ alternatives

• G-Group Decision making:

• Strength of Group DM:
• Groups generate more complete information & knowledge.
• More inputs in Decision Making
• Offer increased diversity of View
• More approaches & alternatives
• High Quality Decisions
• Increased acceptance of Solution
• Enthusiastic Support to decision 7 encourage others to accept
• Weakness of Group Decision Making:
• Time consuming
• Group Decision can be dominated by one or more few members.
• Ambiguous responsibility regarding accountability.

Groupthink: Phenomena in which the norm for consensus overrides the realistic appraisal of alternative course of
action.
• Means, when GT occurs, people keep siolent about misgivings & silence is seen as agreement. E.g Faculty
members meeting---agenda---student courses----later one member objects the courses offered , why
afterwards ? Because of “groupthink”
• Group Shift: A change in decision making b/w groups decision & the individual decision that members within
the group would make, can either toward conservatism or greater risk. In GS the decision of group reflects
the DOMINANT decision making norm that develops during group discussion, weather the shift in Group
DM is toward caution or more risk depends on Dominant Pre discussion Norm.
• Group Decision Making Techniques:
1- Interacting Groups: Typical groups where members interact with each other face to face:
• 2-Brainstorming: an idea generation process that specifically ENCOURAGES any/all alternatives, while
withholding any CRITICISM of these alternatives.
• 6-12 persons around a table, No criticism is allowed.
• 3- Nominal Group Technique:
• In this method, individual members meet face to face to pool their judgments in a systematic but Independent
fashion.
• Members meet in a group BUT write down his ideas on topic
• Each member presents one idea to group turn by turn
• Ideas are discussed & evaluated. Each group member silently & independently Rank - order the ideas. Idea
with highest ranking determines final decision
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• 4- Electronic Meeting: A meeting where members interact on computers allowing for anonymity of comments
& aggregating of votes:
• 50 persons, Sit like a horse-shoe table, Type responses on Screen

Work Teams: Formal groups made up of interdependent individuals who are responsible for attainment of
a goal.
Types of Teams: 1- Functional teams: it is composed of a manager and his subordinates from a particular
functional aea.

2- Self managed teams: A type of work team that operates without a manager and is responsible for a
complete work process or segment.
3- Virtual Team: A type of work team that uses computer technology to link physically dispersed
members in order to achieve common goal.
4- Cross- functional Team: a work team that is a hybrid grouping of individuals who are experts in
various specialties and who work together on various tasks.
CHARACTERISTICS OF EFFECTIVE TEAMS

External Clear
Internal Goals Relevant
Support Skills
Support
Mutual
Effective Trust
Appropriate Team
Leadership

Negotiating Unified
Skills Good
Communication Commitment

Motivation:
The willingness to exert high levels of effort toward organizational goals, conditioned by the efforts ability to satisfy
some individual need

• Motivation is interaction of Individual & situation

• Effort: measure of intensity, that is directed toward & consistent with organizational goal.
• Need: some internal state that makes certain outcomes appear attractive.
• Motivation Process
• Unsatisfied needs Tension Drives Search behavior satisfied Needs Tension Reduction
• means that MOTIVATED employees are in state of ‘Tension’ & to relieve this they exert efforts.
• If efforts leads to SATISFACTION of need Tension reduced but it should be directed toward &
consistent with organizational goal.
• E.g sales officer P.R with retailers Org Goal.
• Instead people in offices gossips fulfill social needs .
• Maslows Hierarchy of Needs Theory:
Physiological, safety, social, Esteem & Self Actualization, as each need is substantially satisfied, the next
need becomes dominant.
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Physiological includes: hunger, thirst, shelter, sex etc.
Safety includes: security & protection from physical & emotional term

Social includes: Affection, belongingness, acceptance & friendship.

Esteem:(internal) self respect, Autonomy independent of control)& Achievement. external) Status, Recognition &
attention

• Self Actualization: drive to BECOME what one is capable of becoming, includes: GROWTH, Achieving
one’s potential & self-fulfillment.* Low Order Needs: needs that are satisfied externally: physiological &
safety* High Order Needs: needs that are satisfied internally: social, esteem, self actualization e.g pay etc
• Theory X & Theory Y by Douglas Mc Gregar
• Theory X: (Negative Labeled) assumption that employee dislike work, are lazy, dislike responsibility and
must be coerced(forced ) to perform.
• Assumptions include:
• 1) employees inheritly dislike work & whenever possible will ATTEMPT to avoid it.
• 2) since employees dislike work , they must be forced , controlled or threatened with punishment to achieve
goals.
• 3) Employees will avoid responsibility& seek formal direction whenever possible.
• 4) Most workers place security above all other factors associated with work & will display little Ambition.

Theory Y:The assumption that employees like Work, are CREATIVE, SEEK responsibility & can exercise self
direction.
1) Employees can view work as being as natural as rest or play.
2) People will exercise self- direction & self control if they are committed to Objectives.

3)the average person can LERAN to accept, even seek responsibility.

4) The ability to make innovative decisions is widely dispersed throughout population & is not necessarily in the sole
province of those in management positions.
Motivation -Hygiene Theory by Frederick Herzberg
• “Intrinsic (basic qualities) factors are related to job satisfaction while Extrinsic factors are associated with
Dissatisfaction.
• Intrinsic factors include: Achievement, Recognition, Work itself, Responsibility, advancement &growth led to
Extreme satisfaction.
• Extrinsic Factors include; company policy, Administration, Supervision, work conditions, salary, personal life
• Hygiene Factors: those factors such as company policy & administration, supervision & salary, that when
Adequate in a job Placate to lessen) workers, when these factors are adequate, people will be dissatisfied.

Mclleland’s Theory of Needs. Achievement, Power & affiliation are three important needs that help explain
Motivation.
• 1-Achievement need .The drive to excel, to achieve in relation to a set of standards, to strive(struggle) to
succeed. E.g Few persons strive for personal achievement rather than awards. High achiever Differentiate
themselves from OTHERS by their desire to do things BETTER.
• Seek situations for personal responsibility
• Receive rapid feedback on their performance
• Set moderately challenging goals / risks
• They want to overcome Obstacles
• 2-Need of Power:Desire to have impact, to be influential.
I.e More concerned with prestige & gaining influence over others THAN with effective performance.
• 3- Affiliation: The desire to be liked & accepted by others. High affiliation includes: friendship, prefer
Cooperative situations instead of competitive, & mutual understanding.E.g of High Achievers: Businessmen
etc.
 20
Goal Setting Theory: The theory that specific & difficult goals lead to higher performance.
E.g “ we listen to our bosses” do your best “…means ?
Specific Goals increase Performance.
Hard goals produce Higher level of Output.
Feedback helps to identify discrepancies b/w what they have done, & what they want to do.
Three factors include: 1-Goal- Commitment
individual is determined not to Leave or abandon the goal.

• 2- Self Efficacy: individual’s belief that he is capable of performing the task. High self efficacy more
confident.
• 3- Culture: subordinates are independent: ( no high power distance, low uncertainty avoidance), high in
quantity of life.

• Reinforcement Theory;
• It is behaviorist approach, which argues that reinforcement conditions behavior.
It concentrates solely on “what happens to a person while he takes some action”.
• Equity Theory
• “Individual compare their jobs Inputs & outcomes with those of others & then respond so as to eliminate any
inequities”
• e.g A sales person (experienced), hired by the company , he is satisfied with job & salary ….his company
hires another sales person , with no/less job experience on higher salary than the first one. ….
• Referent comparisons include:
• 1- Self Inside: employee's experiences in a different position inside his organization.
• 2- Self-outside: an employee’s experience's in a situation/position out side his organization.
• 3-Other-Inside: Another individual or group of individuals inside the organization
• 4-Other -Outside: Another individual or group of individual out side the employee’s organization

Reaction to inequity: Employee may :

1- change their inputs mean s don’t exert as much effort.
2- Change their outcomes means start performing in a low quality
3- Distort perceptions of Self means" I used to think I worked at a moderate pace but NOW I realize that I work a lot
harder than Everyone else”

• 4-Distort perceptions of others means “ e.g azhar’s job is not desirable as I previously thought it was”
• 5-Choose a different Referent means I may not make as much as Azhar but I am doing better than my Dad
when he was my age”
• 6_ leave the field mean s quit the job
• Four prepositions related to inequitable pay.
• Given Payment by time (over rewarded employees will produce more than equitably paid employees) . E.g
hourly & salaried employees.
• Given payment by Quantity of production ;(over rewarded)
• e.g Zip installer will increase effort to achieve equity which results in quality or quality, but increase in
quantity will increase in inequity.
• Given Payment by time (Under rewarded employees) . Employees will produce less or poorer quality of
output.
• Given payment by Quantity of production Under rewarded) employees will produce a large number of low
quality units as compared to equitably paid employees.

Expectancy Theory:”An employee will be motivated to exert high level of effort when he believes that effort will lead
to good performance appraisal, that good performance appraisal will lead to organizational rewards like bonus, a
salary increase, or promotion & these rewards will satisfy employees personal goals.”

• Means :1- effort-performance relationship:

• the probability perceived by the individual that exerting a given amount of effort will lead to performance.
 21
• 2- Performance-reward relationship: the degree to which an individual believes that performing at a particular
level will lead to attainment of desired outcome.
• 3- Rewards- personal goals relationship:
• degree to which organizational rewards satisfy an individuals personal goals/ need & attractiveness of those
potential rewards for individual.

Control: The process of monitoring activities to ensure that they are being accomplished as planned and of
correcting any significant deviations.
Market Control: An approach to control that emphasize the use of external market mechanisms (price competition and
relative market share), to establish the standards used in the control system.

• Three types of Control:

• Type : Characteristics
• Market: Typically used by organizations whose products or services are clearly specified and distinct and
that face considerable marketplace competition.

• Bureaucratic: Emphasizes organizational authority. Relies on administrative and hierarchical

mechanisms, such as rules, regulations, procedures, policies; well defined job descriptions etc.

• Clan: Regulate employee behavior by shared values, norms, traditions, rituals, beliefs and other
aspects of organizational culture.

• The Control Process: A three step process including measuring actual performance, comparing actual
performance against a standard and taking managerial action to correct deviations or inadequate standards.

Measuring: Management by Walking Around (MBWA): A term used to describe when a manager is out in the work
area, interacting directly with the employees and exchanging information about what is going on.

• Comparing: Range of variation: the acceptable parameters of variance between actual performance and the
standard.
• E.g sales performance figures of a distributor of super crisp products for the quarter (April to June, 2006:

• Brand: standard Actual Over (under)

• Tomato ketchup 20,000 pkts 18,300pkts 1700 pkts
• Chilli 10,000 pkts 5000pkts 5000pkts

• Taking managerial Action: a) immediate corrective action: corrective action that corrects the problems at
once to get the performance back on track
• B) Basic corrective action: corrective action that looks at how and why performance deviated and then
proceeds to correct the source of deviation.
 22

Types of control: 1- feed forward control: a type of control that focuses on preventing anticipated
problems since it takes place in advance of the actual work activity .e.g MacDonald's before opening in
Moscow sent their experts to Moscow to train them to get the standardized quality of potato for their use .

2- Concurrent Control: A type of control that takes place while a work activity is in progress

3- feedback Control: A type of control that takes place after a work activity is done.

Operations Management: The design, operation and control of the transformation process that converts
resources into finished goods or services.

People
Technology
Capital Transformation Goods
Equipment
Materials
Process
Services
Information