Ch05 be7e instructor_power_point

5chapter

Business Essentials, 7th EditionEbert/Griffin

© 2009 Pearson Education, Inc.

Business Management

Instructor Lecture PowerPointsPowerPoint Presentation prepared by

Carol Vollmer Pope Alverno College

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

© 2009 Pearson Education, Inc. 2

After reading this chapter, you should be able to:1. Describe the nature of management and identify the four

basic functions that constitute the management process.

2. Identify different types of managers likely to be found in an organization by level and area.

3. Describe the basic skills required of managers.

4. Explain the importance of strategic management and effective goal setting in organizational success.


L E A R N I N G O B J E C T I V E SL E A R N I N G O B J E C T I V E S

After reading this chapter, you should be able to:

5. Discuss contingency planning and crisis management in today’s business world.

6. Describe the development and explain the importance of corporate culture.

L E A R N I N G O B J E C T I V E S (cont’d)L E A R N I N G O B J E C T I V E S (cont’d)


What’s in It for Me?

• By understanding the material discussed in this chapter, you’ll be better prepared to:– Carry out various management responsibilities

yourself– More effectively assess and appreciate the quality

of management in various companies from the perspective of a consumer or investor


Who Are Managers?• Good Managers

– Are responsible for business performance and effectiveness

• Effective—do the right things; achieve goals• Efficient—do things right; lower costs

– Are accountable to all key stakeholders• Develop strategic plans and tactical plans• Analyze their competitive environments and

plan, organize, direct, and control day-to-day operations


The Management Process

LeadingLeadingGuiding and MotivatingGuiding and Motivating

LeadingLeadingGuiding and MotivatingGuiding and Motivating

ControllingControllingMonitoring PerformanceMonitoring Performance

ControllingControllingMonitoring PerformanceMonitoring Performance

PlanningPlanningSetting GoalsSetting Goals

PlanningPlanningSetting GoalsSetting Goals

OrganizingOrganizingStructuringStructuring

OrganizingOrganizingStructuringStructuring

• Management– The process of planning, organizing, leading, and

controlling a firm’s financial, physical, human, and information resources to achieve its goals


Planning

• The Planning Process– Determining firm’s goals– Developing strategy for achieving goals– Designing tactical and operational plans for

implementing the strategy


Organizing

• The Organizing Process– Arranging resources and activities in a

coherent structure• Prepare organizational charts to help everyone

understand roles and reporting relationships


Leading

• Leading– Guiding and motivating employees to meet the

organization’s objectives• Uniting employees in a clear and targeted manner and

motivating them to work in the best interests of the employer


Controlling

• The Controlling Process– Monitoring a firm’s performance to make sure

that it is meeting its goals• Begins when management establishes standards,

often for financial performance• Can serve as a basis for providing rewards or reducing

costs


FIGRE 5.1 The Control Process


Types of Managers• Levels of Management

– Top managers: Responsible for the overall performance of the firm

• President, vice president, treasurer, CEO, CFO

– Middle managers: Implement strategies and work toward goals set by top managers

• Plant manager, operations manager, division manager

– First-line managers: Work with and supervise employees

• Supervisor, office manager, project manager, group leader


Human Human ResourcesResources

Human Human ResourcesResources

MarketingMarketingMarketingMarketing

FinancialFinancialFinancialFinancial

OperationsOperationsOperationsOperations

InformationInformationInformationInformation

OtherOtherOtherOther

Areas of Management


Basic Management Skills

Human Human Relations Relations

SkillsSkillsTechnical Technical

SkillsSkills

Conceptual Conceptual SkillsSkills

time-time-management management

skillsskills

Decision-Decision-Making Making SkillsSkills


time-management skills

• Four leading time wasters:– Paperwork– Telephone calls– Meetings– E-mail


Management Skills for the 21st Century

• Global Management Skills– Understand foreign markets, cultural differences, and the

motives and practices of foreign rivals– Understand how to collaborate with others around the

world on a real-time basis

• Management and Technology Skills– Needed to process increasing

amounts of information© 2009 Pearson Education, Inc.

Strategic Management: Setting Goals and Formulating Strategy

• Planning• Set goals (SMART)

• Goals• Objectives that a business hopes and plans to achieve

• Strategy• The broad set of action plans to achieve company goals


SWOT Analysis

A. STRENGTHS - internal, positiveB. WEAKNESSES - internal, negativeC. OPPORTUNITIES - external, positiveD. THREATS - external, negative

Setting Business Goals• Goals

– Performance targets that organizations and their managers use to measure success or failure

• Mission Statement– A statement of how a business will achieve its

fundamental purpose• Effective organizations set goals at many different

levels:– Long-term goals: five years or more– Intermediate goals: one to five years– Short-term goals: one year or less


Purposes of Goal Setting

• Goal Setting:– Provides direction and guidance for managers at

all levels– Helps firms allocate resources– Helps to define corporate culture– Helps managers assess performance


Types of Strategy

• Corporate Strategy– Determines what business or businesses a company will

own and operate

– Growth• Related diversification• Unrelated diversification

– Retrenchment• Downsizing and divestiture


Types of Strategy (cont’d)

• Business (or Competitive) Strategy– Focuses on improving the company’s competitive position

at the level of the business unit or product line

• Functional Strategy– Guides managers in specific areas such as marketing,

finance, and operations in deciding how best to achieve corporate goals by performing their functional activities most effectively


Formulating Strategy

Step 1: Setting Strategic Goals– Strategic goals are derived from a firm’s mission

statementStep 2: Analyzing the Organization and the Environment: SWOT

Analysis– Assessing internal strengths and weaknesses and

external opportunities and threats• Environmental analysis• Organizational analysis

Step 3: Matching the Organization and Its Environment– Matching environmental threats and opportunities

against corporate strengths and weaknesses


Figure 5.2 Strategy Formulation


A Hierarchy of Plans• Strategic Plans

– Reflect decisions about resource allocations, company priorities, and the steps needed to meet strategic goals

• Tactical Plans– Shorter-term plans for implementing specific aspects

of the company’s strategic plans

• Operational Plans– Mid-level and lower-level managers set short-term

targets for daily, weekly, or monthly performance


Contingency Planning and Crisis Management

• Contingency Planning– Planning for change– Seeks to identify in advance important aspects of a

business or its market that might change and the ways in which a company will respond to changes

• Crisis Management– Involves an organization’s methods for dealing with a

crisis—an unexpected emergency requiring immediate response


Management and the Corporate Culture• Corporate Culture

– Is the shared experiences, stories, beliefs, and norms that characterize an organization

– Helps define the work and business climate that exists in an organization

• Communicating the Culture– Managers must understand the culture– Managers must transmit the culture to others in the

organization– Managers can support the culture by rewarding and promoting

those who understand it and work toward maintaining it


Managing Change in the Culture

• Stages in the Change Process

– At the highest level, analysis of the company’s environment highlights extensive change as the most effective response to its problems.

– Top management begins to formulate a vision of a new company.

– The firm sets up new systems for appraising and compensating employees who enforce the firm’s new values.


Key Terms

business (or competitive) strategy conceptual skills contingency planning controlling corporate culture corporate strategy crisis management decision-making skills leading environmental analysis first-line manager functional strategy goal

human relations skills intermediate goal long-term goal management middle manager mission statement organizational analysis organizing operational plan planning short-term goal strategic goal strategic managementstrategic plan


Key Terms (cont.)

strategy strategy formulation SWOT analysis tactical plan technical skills time-management skills top manager


Ch05 be7e instructor_power_point

Education

pearson education

management process management

qualityof management

nature of management

realtime basis management

firms goals

process of planning

planning process