Part A: Principles of Management

Chapter B1: Managing

Instructor: DAO MINH ANH (PhD.)

Chapter B1

Chapter B4

Chapter B16
 Learning Objectives
• Summarize major challenges of managing in the new
competitive landscape
• Describe the drivers of competitive advantage for a
company
• Explain how the functions of management are
evolving in today’s environment
• Compare how the nature of management varies at
different levels of an organization
• Define the skills you need to be an effective manager
• Understand the principles that will help you manage
your career
 Surprising numbers
• In 2015, number of newly-established
enterprises: 94,754 with the capital of 601.5
thousand billion VND
• However, number of enterprises in difficulty that
must stop their business: 71,391; increasing
22.4% compared with the one at the previous
year, in which:
– 26,349 one-member limited companies
– 22,889 two-member limited companies
– 13,081 joint-stock companies
– 9070 private enterprises
– 2 partnerships
Managing in the New Competitive
Landscape

Globalization Technological
Change

Knowledge Collaboration
Management across
Boundaries
Managing for Competitive Advantage
Key Concept Definition
Innovation The introduction of new goods and
services

Quality The excellence of your product

Service Giving customers what they want or

need, the way they want it
Speed Fast and timely execution, response, and
delivery of results
Cost competitiveness Keeping costs low to achieve profits and
offer prices attractive to customers
 Vinamilk’ business phylosophy

“Vinamilk desires to become one

of the most favourite brands in
Quality Demand every region and territory.
Therefore, we keep in our mind
and our heart that the quality
Innovation and innovation are always our
most important companions. We
act with customer-centered
approach and commit to respond
to all their needs”
Managing for Competitive Advantage
Key Concept Definition

Delivering all five Incorporating innovation, quality,

service, speed, and cost
competitiveness

Although managers must make some trade-offs,

managing for competitive advantage means successfully
delivering a winning mix – one or more can be more
emphasized over the others, but all need to be delivered.
 Samsung
• How do they compete in the market?
 Defining Management
• Management
– The process of working with people and resources to
accomplish organizational goals effectively and
efficiently using FOUR functions: Planning, Organizing,
Leading, and Controlling (POLC).

• Effectiveness
– Achieving organizational goals

• Efficiency (different from operations term)

– Achieving goals with minimal waste of money, time,
materials, and people
The Functions of Management

Planning Delivering strategic value

(Setting goals)
Organizing Building a dynamic organization
(Allocating resources)
Leading Mobilizing people
(Motivate/empowering employees)
Controlling Learning and changing
(Monitoring and correcting)
 The Process of Management
Planning

Select goals and

ways to attain
them
Performance
Resources
•Human •Attain goals

•Financial Controlling Organizing •Products

•Raw Materials Monitor activities •Services

Assign responsibility
and make •Efficiency
•Technological for task
corrections
accomplishment •Effectiveness
•Information

Leading

Use influence to
motivate employees

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 Performing all Four Functions of
Management

• A manager’s day is not neatly divided into

the four functions

• Successful managers handle all four

functions simultaneously
Management Levels and Skills
Management Levels in the Organizational Hierarchy
 Management Levels and Skills
Top-level Senior executive responsible for the
managers overall management of the
organization

Middle-level Located in the middle layers of the

managers organizational hierarchy reporting to
top-level managers

Frontline Supervise the operational activities of

managers the organization; also called
operational managers
What Do Managers Do?
 Management Levels and Skills
• Working leaders with broad responsibilities
– Today’s trends are toward less hierarchy and
more teamwork
– The best managers are “working leaders” – not
by telling the team what to do, but by leading
the team by examples.
 Management Levels and Skills

Key Skill Definition

Technical skill The ability to perform a specialized task
involving a particular method or process

Interpersonal and People skills; the ability to lead, motivate, and

communication skills communication effectively with others

Conceptual and The ability to identify and resolve problems

decisional skills for the benefit of the organization and its
members
 Management Levels and Skills
• Working leaders tend to engage in 10
activities that fall into three categories or
roles
– Interpersonal roles
– Informational roles
– Decisional roles
 Ten Manager Roles
Category Role Activity
(conceptual)
Informational Monitor Seek and receive info, scan reports, keep personal contacts.

Disseminator Forward info to other organization members via memos &

reports.
Spokesperson Transmit info to outsides through speeches & reports.

Interpersonal Figurehead Perform ceremonial & symbolic duties – signing documents.

Leader Direct & motivate subordinates-train, counsel, and

communicate w/them

Liaison Maintain info links both inside & outside organization.

Decisional Entrepreneur Initiate improvement projects; identify new ideas, delegate

idea responsibility to others.

Disturbance Take corrective action during disputes or crises; resolve

handler conflicts among subordinates; adapt to environmental crises.

Resource Decide who gets resources; schedule, budget, set priorities.

allocator

Negotiator Represent dept. during negotiation of union contracts, sales,

purchases, budgets; represent departmental interests. 21
Hierarchical Levels

22
 Managing in Small Businesses and Nonprofit
Organizations
• Small businesses
– Role Differences
• Higher spokesperson & entrepreneur role
• Lower leader & info-processing role
• Non-profit Org.
– Role Differences: Higher spokesperson, leader & resource
allocator
– Source of Financial Resources
→ meeting donors interest
– Unconventional Bottom line
Not by dollars and cents→ What constitutes
RESULTS & EFFECTIVENESS? 23
 You and Your Career

• Emotional intelligence
– Understanding yourself:
• Realizing your strengths and limitations
– Managing yourself
– Dealing effectively with others
You and Your Career
 You and Your Career
Tips for Success

Be both a specialist and a generalist

Be self-reliant: to take full responsibility for yourself,

your actions, and your career.

Be connected: to have many good working

relationships with your team.

Actively manage your relationship with your

organization
Survive and thrive
 You and Your Career
• Social capital
– Goodwill stemming from your social relationships

• Business decisions both inside and outside the

organization involve networks of people

• Social capital leverages your goodwill to make

you and your organization more successful
 Evolution of Management
(See Appendix A – p B37-44)
 Technology-Driven Workplace
⚫ E-business vs. E-commerce ?
⚫ E-business: Work an org does by using electronic linkage
(LAN, Internet)
⚫ E-commerce: Narrower meaning, Business exchanges or
transactions that occur electronically
⚫ ERP: Enterprise Resource Planning weaves together all of a
company’s major business functions such as orders, design,
purchasing, inv, HR, forecasting, e.g. SAP or Oracle
⚫ KM: Knowledge Management (by Peter Drucker) refers
efforts to systematically find, organize, and make available a
company’s intellectual capital.

29
 Technology-Driven Workplace
Types of E-Commerce

Business-to-Consumer (B2C )
Selling Products and
Services Online, e.g. Amazon

Consumer-to-Consumer (C2C )
Business-to-Business (B2B ) Electronic Markets
Transactions Between Created by Web-Based
Organizations, e.g. Ford, Dell Intermediaries, e.g. eBay
Exhibit 2.8, p. 63

30
 Globalization
• Strong demand for • Strong demand for
products/services from all talent (Global talent
over the world pool)

• Internet access across the • Global marketplace

globe - World has shrunk (efficient/advanced
logistics)

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 Technological Change
• The Internet’s impact on globalization
– Increased speed of communication
– The Internet as a marketplace

• Problems we did not have before…

– Stress when employees/supervisors do not set
limits on being connected
– Lengthening of the workday due to constant
access
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 Knowledge Management
• Growing need for good, new ideas generates
demand for knowledge workers
• Challenges…
– Managers cannot simply measure output of
knowledge workers
– Managers should provide knowledge workers with
interesting work to increase motivation

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 Collaboration across Boundaries
• People in different parts of the organization
must collaborate with one another; often
times, across the globe.

• Collaboration also entails moving beyond the

boundaries of the organization itself

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 Innovation
• Managers must adapt to
– Changes in consumer demand
– Changes in new competitors

• Alternative product/service delivery can be

as innovative as new products/services
themselves

• Innovation is driven by globalization

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 Quality
• Quality standards are ever increasing!

• Total quality management

– Preventing defects before they occur
– Achieving zero defects in manufacturing
– Designing products for quality from design phase

• Goal: Continuous improvement in how the

company operates

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 Service
• Continually meet customer needs to
establish mutually beneficial long-term
relationships

• Make it easy for customers to experience a

service or buy and use products. Consumers
want good experiences!

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 Speed
• Speed involves rapidly
– Developing and getting products to market
– Responding to customer requests

• Speed combined with quality is a measure of

whether a company is operating efficiently

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 Cost Competitiveness
• Managing costs requires efficiency
– Efficiency is accomplishing goals by using
resources wisely and minimizing waste

• Understanding all product/service specific

costs is essential to managing for cost
competitiveness
– Customers (The market) set the price.
Therefore, the lower the costs, higher the
profits!

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 Managing Yourself
• Dealing with your emotions

• Making good decisions

• Seeking and using feedback

• Exercising self-control

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Dealing Effectively with Others
• Listening

• Showing empathy

• Motivating

• Leading

• Other similar traits

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TIPS FOR SUCCESSFUL MANAGERS
Ethics in life and business
• Do the right things
• Respect people (family, teachers,
friends, colleagues, employees…)
• Listen to and Stand in others’ side
to understand them
• Treat others well