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CHAPTER 1
Managers and
Managing
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Learning Objectives (1 of 2)
1. Describe what management is, why management is
important, what managers do, and how managers use
organizational resources efficiently and effectively to
achieve organizational goals.
2. Distinguish among planning, organizing, leading, and
controlling (the four principal managerial tasks), and
explain how managers’ ability to handle each one
affects organizational performance.
3. Differentiate among three levels of management, and
understand the tasks and responsibilities of managers
at different levels in the organizational hierarchy.

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Learning Objectives (2 of 2)
4. Distinguish among three levels of managerial
skill, and explain why managers are divided
into different departments to perform their tasks
more efficiently and effectively.
5. Discuss some major changes in management
practices today that have occurred as a result
of globalization and the use of advanced
information technology (IT).
6. Discuss the principal challenges managers face
in today’s increasingly competitive global
environment.

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What Is Management? (1 of 3)
Organizations
• Organizations are collections of people who
work together and coordinate their actions to
achieve a wide variety of goals or desired
future outcomes.
• All managers work in organizations.
Managers
• Managers are the people responsible for
supervising the use of an organization’s
resources to meet its goals.

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What Is Management? (2 of 3)
Management
• Management includes the planning,
organizing, leading, and controlling of
human and other resources to achieve
organizational goals effectively and
efficiently.
• What difference can a manager make?
Satya Nadella, Microsoft CEO

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What Is Management? (3 of 3)
Resources
• Include assets such as:
1. People and their skills, know-how, and experience.
2. Machinery.
3. Raw materials.
4. Computers and information technology.
5. Patents, financial capital, and loyal customers and
employees.

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Achieving High Performance:
A Manager’s Goal (1 of 2)
Organizational performance
• A measure of how efficiently and effectively
managers use available resources to satisfy
customers and achieve organizational goals
• Microsoft’s corporate mission revised by CEO
Satya Nadella to reflect current technological
trends, resulting in increased employee moral,
product quality, and stock market values

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Achieving High Performance:
A Manager’s Goal (2 of 2)
Efficiency
• A measure of how well or how productively
resources are used to achieve a goal
• UPS instructing drivers to leave truck doors open when going
short distances to reduce delivery times
Effectiveness
• A measure of the appropriateness of the goals
an organization is pursuing and the degree to
which the organization achieves those goals
• Microsoft’s restructure eliminating internal competition,
resulting in increased employee morale and performance.

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Figure 1.1 Efficiency, Effectiveness, and
Performance in an Organization
High-performing organizations are efficient and effective.
Jump to Appendix 1 for description
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Why Study Management? (1 of 2)
1. Individuals generally learn through
personal experience or the experiences
of others.
By studying management in school, you
are exposing yourself to the lessons
others have learned.

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Why Study Management? (2 of 2)
2. The economic benefits of becoming a
good manager are also impressive. In the
United States, general managers earn a
median wage of $99,310 with a projected
growth rate in job openings of 5 % to 9%
between now and 2026.
3. Learning management principles can help
you make good decisions in nonwork
contexts.

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Figure 1.2 Four Tasks of
Management
Jump to Appendix 2 for description
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Steps in the Planning Process
1. Deciding which goals the organization will
pursue
2. Deciding what strategies to adopt to attain
those goals
3. Deciding how to allocate organizational
resources.
Managers identify and select appropriate
organizational goals and develop strategies
for how to achieve high performance.

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Organizing (1 of 2)
Organizing
• Structuring working relationships so
organizational members interact and
cooperate to achieve organizational goals
Managers deciding how best to organize
resources, particularly human resources

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Organizing (2 of 2)
Organizational structure
• A formal system of task and reporting
relationships that coordinates and motivates
organizational members so that they work
together to achieve organizational goals
• ER director Daley works closely with team,
increasing efficiency and improving
customer satisfaction

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Leading
Leading
• Articulating a clear vision and energizing and
enabling organizational members so they
understand the part they play in achieving
organizational goals
• An organization’s vision is a short, succinct, and inspiring
statement of the organization’s future state.
• Involves managers using their power,
personality, influence, persuasion, and
communication skills to coordinate people and
groups

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Controlling (1 of 2)
Controlling
• Evaluating how well an organization is
achieving its goals and taking action to
maintain or improve performance
Managers monitor performance of
individuals, departments, and the
organization as a whole to determine if
they are meeting performance standards

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Controlling (2 of 2)
The outcome of the control process is the
ability to measure performance accurately
and regulate organizational efficiency and
effectiveness.
Managers must decide which goals to
measure.

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Example: Mercy Medical Center
Erin Daley is the ER director for Mercy
Medical Center in Massachusetts.
Improving ER department efficiency and
quality of care while keeping costs within
budget can be daunting.
Managers like Erin Daley must develop
strategies and processes where hospitals
can move patients through the system faster
while improving patient satisfaction.

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Managerial Roles Identified (1 of 3)
Type of Role Specific Role Examples of Role Activities
Decisional Entrepreneur Commit organizational resources to develop innovative
goods and services; decide to expand internationally to
obtain new customers for the organization’s products.
Decisional Disturbance handler Move quickly to take corrective action to deal with
unexpected problems facing the organization from the
external environment, such as a crisis like an oil spill, or
from the internal environment, such as producing faulty
goods or services.
Decisional Resource allocator Allocate organizational resources among different tasks
and departments of the organization; set budgets and
salaries of middle and first-level managers.
Decisional Negotiator Work with suppliers, distributors, and labor unions to
reach agreements about the quality and price of input,
technical, and human resources; work with other
organizations to establish agreements to pool resources
to work on joint projects.
Table 1.1 Managerial Roles Identified by Mintzberg

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Managerial Roles Identified (2 of 3)
Type of Role Specific Role Examples of Role Activities
Interpersonal Figurehead Outline future organizational goals to employees
at company meetings; open a new corporate
headquarters building; state the organization’s
ethical guidelines and the principles of behavior
employees are to follow in their dealings with
customers and suppliers.
Interpersonal Leader Provide an example for employees to follow; give
direct commands and orders to subordinate; make
decisions concerning the use of human and
technical resources; mobilize employee support for
specific organizational goals.
Interpersonal Liaison Coordinate the work of managers in different
departments; establish alliances between different
organizations to share resources to produce new
goods and services; reach agreements about the
quality and price of input, technical, and human
resources; work with other organizations to
establish agreements to pool resources to work on
joint projects.
Table 1.1 Managerial Roles Identified by Mintzberg

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Managerial Roles Identified (3of 3)
Type of Role Specific Role Examples of Role Activities
Informational Monitor Evaluate the performance of managers in different
tasks, and take corrective action to improve their
performance; watch for changes occurring in the
external and internal environments that may affect
the organization in the future.
Informational Disseminator Inform employees about changes taking place in the
external and internal environments that will affect
them and the organization; communicate to
employees the organization’s vision and purpose.
Informational Spokesperson Launch a national advertising campaign to promote
new goods and services; give a speech to inform the
local community about the organization’s future
intentions.
Table 1.1 Managerial Roles Identified by Mintzberg
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Levels and Skills of Managers (1 of 2)
Department
• A group of managers and employees who
work together and possess similar skills or
use the same knowledge, tools, or techniques
• Example: the manufacturing, accounting,
engineering, or marketing department

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Figure 1.3 Levels of Management
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Levels of Management (1 of 2)
First-line managers (often called supervisors)
• Responsible for the daily supervision of the
nonmanagerial employees
• Paint foreman overseeing a crew of painters at a University
Middle managers
• Supervises first-line managers
• Responsible for finding the best way to use
resources to achieve organizational goals
• High school principal or a marketing manager

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Levels of Management (2 of 2)
Top managers
• Responsible for the performance of all
departments
• Establish organizational goals
• Decide how different departments should
interact
• Monitor how well middle managers in each
department use resources to achieve goals
• President of a university

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Levels and Skills of Managers (2 of 2)
Figure 1.4 Relative
Amount of Time
Managers Spend
on the Four
Managerial Tasks
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Managerial Skills
Conceptual skills
• The ability to analyze and diagnose a situation
and distinguish between cause and effect
Human skills
• The ability to understand, alter, lead, and control
the behavior of other individuals and groups
Technical skills
• Job-specific skills required to perform a particular
type of work or occupation at a high level

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Figure 1.5: Types and
Levels of Managers
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Core Competency
Core competency
• Specific set of departmental skills, abilities,
knowledge and experience that allows one
organization to outperform its competitors
• Skills for a competitive advantage
• Google’s core competency, research and development,
allows them to develop innovative products and services
(computerized glasses, self-driving cars).

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Restructuring and Outsourcing
Restructuring
• Downsizing an organization by eliminating the
jobs of large numbers of top, middle, and first-
line managers and nonmanagerial employees
Outsourcing
• Contracting with another company, usually in
a low-cost country abroad, to perform a work
activity the company previously performed
itself

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Empowerment
Empowerment
• Empowerment involves giving employees
more authority and responsibility over how
they perform their work activities.
• Example: Valve Corporation has no
managers, no hierarchy or top-down control.
Employees pick their own projects.

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Challenges for Management in a
Global Environment
Building a competitive advantage
Maintaining ethical and socially responsible
standards
Managing a diverse workforce
Utilizing new technologies
Practicing global crisis management

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Building Competitive Advantage
Competitive advantage
• Ability of one organization to outperform other
organizations because it produces desired
goods or services more efficiently and
effectively than its competitors
Innovation
• The process of creating new or improved
goods and services or developing better ways
to produce or provide them

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Figure 1.6 Building Blocks of
Competitive Advantage
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Turnaround Management
Turnaround management
• Creation of a new vision for a struggling
company using a new approach to planning
and organizing to make better use of a
company’s resources to allow it to survive and
eventually prosper
• Apple’s Steve Jobs excelled at turnaround management.

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Maintaining Ethical and
Socially Responsible Standards
Managers are under considerable pressure
to make the best use of resources.
Too much pressure may induce managers to
behave unethically and even illegally.
• Wells Fargo Scandal “Eight is great”

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Managing a Diverse Workforce
To create a highly trained and motivated
workforce, managers must establish human
resource management (HRM) procedures
that are legal and fair and do not discriminate
against organizational members.
• Accenture uses a diverse workforce to its
advantage.

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Utilizing New Technologies
An efficient and effective IT system may
improve an organization’s performance.
• UPS uses ORION
• A GPS system that optimizes drivers’ routes

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Practicing Global Crisis Management
1. Create teams to facilitate rapid decision-
making and communication.
2. Establish the organizational chain of
command and reporting relationships
necessary to mobilize a fast response.
3. Recruit and select the right people to lead
and work in such teams.
4. Develop bargaining and negotiating
strategies to manage the conflicts that arise.