BHM 2041/2043/2046 Basic Economics, Accounting & Management

Dr. Arnifa Haji Asmawi FOM, MMU

Management: An Introduction
(Week 1, 15-21 June 2009)

2004

2005

2008

3

Key Realities In Management
 The

only certainty today is change teamwork and flexibility

 Speed,

 Customer-centricity  Continuous

learning

improvement and lifelong
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Learning Objectives
1. 3.

Define the basic components of management Identify the basic skills of effective management Explain the role of managers Explain the various management theories Understand what management is all about

5. 7. 9.

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Definition of Management ?
Attainment of organizational goals in an effective and efficient manner through the four management functions: - Planning - Organizing - Leading - Controlling

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The Process of Management
Input Management Function
Planning Select goals and ways to attain them

Output

Resources Human Financial Raw Materials Technology Information

Performance Attain goals Products Services Efficiency Effectiveness

Controlling Monitor activities and make correction

Organizing Assign responsibility for task accomplishment

Leading Use influence to motivate employees

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What is an organization?
A social entity that is goal directed and deliberately structured.

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Characteristics of an Organization

Source: Robbins & Coulter (2007)
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Effectiveness and Efficiency in Management

Source: Robbins & Coulter (2007)
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The Four Functions of Management
Planning Defining goals, establishing strategies and developing sub-plans to coordinate activities. Decides tasks and use of resources Organizing Determining what needs to be done and how it will be done and who is to do it. Involves assignment of tasks into departments and allocation of resources across organization Leading Directing and motivating all involved parties and resolving conflicts Controlling Monitoring activities to ensure that they are accomplished as planned. Determining whether the organization is on target towards its goals. Making corrections as necessary

Achieving the organization’s goals and objectives

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Who is a manager?
An organizational member who integrates and coordinates the work of others

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Types of managers

Vertical Horizontal

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Types of Managers (Vertical)

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First-line Manager s

Types of Managers (Vertical)  the lowest level of management.
    manage the work of non-managerial employees train non-managerial employees encourage, monitor and reward performance e.g. sales supervisors, accounting supervisors

Middle Manager s

Top Manager s

 manage the work of first-line managers.  set objectives aligned with top management goals and plans  plan and allocate resources  coordinate departments and divisions within company  e.g. General Manager, Accounting Manager  create organization vision and mission  establish plans and goals that affect the entire organization  create positive organizational culture  monitor internal and external business environment 15  e.g. CEO, President, Managing Director

Relative amount of time that Managers spend on the four managerial functions

Planning

Organizing

Leading Controlling

Top Managers

Middle Managers

First-line Managers

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Types of Managers (Horizontal)
Function al Manager s General Manager s  Manage departments performing a single functional task.  e.g. sales manager, finance manager, accounting manager.  Responsible for several departments with different functions.  e.g. general manager of a department store, project manager.
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Management Skills
 Conceptual

skills Ability to see the organization as a whole and the relationship among its parts. skills Ability to work with and through other people and to work effectively as a group member skills Understanding of and proficiency in

 Human

 Technical

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The Skills Required of the Different Types of Managers

Top Managers

Middle Managers

Conceptu al Skills

Human Skills

Technical Skills

First-line Managers NonManagers
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Managerial Roles
Informational 2. 4. 6. Monitor Disseminator Spokesperson 2. 4. 6. Interpersonal Figurehead Leader Liaison 2. 4. Decisional Entrepreneur Disturbance handler Resource allocater Negotiator

6.

8.

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Management Theories
The evolution of management theories is due to three factors. 1. Social Forces 2. Political Forces 3. Economic Forces

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Four Approaches to Management Theories
 The  The  The  The

Classical Approach Behavioral/Humanistic Approach Management Science Approach Modern Approach
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The Classical Approach
 Scientific

Management Organization Principles

 Bureaucratic

 Administrative

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 Pioneers  Careful  Precise  Putting  Having

- Fredrick Winslow Taylor, Frank and Lillian Gilbreth study of individual work situation work procedures developed

the right person on the job with the correct tools and equipment a standardized method of doing the job. worker. an economic incentive to the
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 Providing

Bureaucratic Organization
 Max

Weber

 Systematic

approach to management and looked at the organization as a whole

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Bureaucratic Organization

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Founder - Henri Fayol Believed that the practice of management was distinct from other organizational functions

Developed fourteen principles of management

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1. Division of work. 2. Authority. 3. Discipline. 4. Unity of command. 5. Unity of direction. 6. Subordination of individual interest to the interests of the organization.

1. 2. 3. 4. 5. 6. 7. 8.

Remuneration. Centralization. Scalar chain. Order. Equity. Stability of tenure of personnel. Initiative. Esprit de corps.
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The Behavioral/Humanistic Approach

Human Relations Perspective Human Resources Perspective

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Human Relations Perspective
Hugo Munsterberg Role of psychologist in industry Study jobs & the suitable people Identify psychological work conditions Devise strategies to influence employees Importance of human behavior in shaping management style Coordination –key to effective management coordinate and harmonize group effort best decisions are by those closest to the situation integration process- to solve conflicts Hawthorne Experiments productivity increased because someone was paying attention Improvement in productivity due to social factors (morale, group relationship, leading, communicating)
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Mary Parker Follet

Elton Mayo

Human Resources Perspective
Chester Barnard Two primary functions of managers: Establish and maintain communication system Establish objectives of organizations and motivate employees Theory on authority- authority flows from the ability of the subordinates to accept or reject an order Abraham Maslow The Hierarchy of Human Needs People will perform well if work provides them with opportunities to satisfy their needs Theory X and Theory Y of human behavior Theory Y is a more realistic view of workers- employees will exercise self-control and will contribute to organizational goals when given the opportunity.
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Douglas McGregor

Maslow’s Hierarchy of Needs

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McGregor’s Theory X and Theory Y
Theory X Assumptions Theory X Assumptions
• • Dislike work-will avoid it Must be coerced, controlled, directed or threatened with punishment Prefer direction, avoid responsibility, little ambition, want security • • • • • Do not dislike work Self-direction and selfcontrol Seek responsibility Imagination, creativity widely distributed Intellectual potential only partially utilized.

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Management Science Approach
Characteristics:  Focus on decision making  Use of economic decision criteria  Use of mathematical models  Use of computers in data processing

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The Modern Approach
Looks at the dynamics and responses of an organization facing business challenges
 Systems

approach  Contingency approach  Learning organization
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 System

Defined

– A set of interrelated and interdependent parts arranged in a manner that produces a unified whole.
 Basic

Types of Systems

– Closed systems
 Are not influenced by and do not interact with their environment (all system input and output is internal).

– Open systems
 Dynamically interact to their environments by taking in inputs and transforming them into 36 36

37 2–37

The Contingency Approach
 Contingency

Approach Defined

– Also sometimes called the situational approach. – There is no one universally applicable set of management principles (rules) by which to manage organizations. – Organizations are individually different, face different situations (contingency variables), and require different ways of managing.
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Popular Contingency Variables

Organization size Routineness of task technology Environmental uncertainty Individual differences
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Learning Organization
 An

organization that learns and encourages learning among people. of info  knowledgeable

 Exchange

workforce

 Flexible

organization
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Greater Motivation

Benefits of Learning Organization Flexible workforce
More creative people Improved social interaction Knowledge sharing Interdependency Breakdown of communication barriers Better customer relations More resources More innovation and creativity
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Better teamwork Company benefits

Thank You

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