Giáo trình quản trị kinh doanh đương đại Modern Management

Giáo trình quản trị kinh doanh đương đại Modern Management Introducing Modern Management: Concepts and Skills TA R G E T S K I L L Management Skill: the ability to work with people and other organizational resources to accomplish organizational goals M A N A G E M E N T S K I L L A N D Y O U R C A R E E R Management skill will be of great value to you in enhancing your career. For example, this skill can help you to focus systematically on engaging organizational resources to meet profit goals. Profit making will contribute to organizational success, build your image as a competent manager, make you valuable to your organization, and support promotions as you build your career O B J E C T I V E S To help build my management skill, when studying this chapter, I will attempt to acquire: 11 An understanding of a manager’s task 12 Knowledge about the management process and organizational resources 13 An understanding of management skill as the key to management success 14 Insights concerning what management careers are and how they evolve CHALLENGE CASE Coke’s New CEO Battles a Changing Market This chapter focuses on a number of introductory management topics, but one key concept is that of management employability skills (communication, critical thinking, creativity, collaboration, knowledge application, and ethics and social responsibility). The new CEO of CocaCola is a great example of all six of these management employability skills. CocaCola is a brand that has been around for over 130 years. The iconic logo script, contoured shape of the bottle, and bubbly taste have made Coke one of the most recognizable brands in the world. The beverage giant has enjoyed a worldwide popularity envied by most consumer companies. However, the last 10 years have been tough on Coke and on the carbonated beverage industry in general. Bottled water has supplanted soda as the most commonly purchased drink in the United States, and cities have begun taxing carbonated beverages heavily in hopes of raising funds and curbing obesity and diabetes. In this current turbulent climate, James Quincey took the reins as CEO of the soda giant in 2017. Beginning his career with Coke in 1996, he oversaw operations in Latin America and Europe and worked his way up to chief operating officer, learning along the way the employability skill of knowledge application. Each position he filled in his career with the company taught him something new that he could utilize in subsequent positions. The former CEO, Muhtar Kent, had held the position for 8 years and groomed Quincey to take over the helm upon his departure. Quincey has a number of challenges ahead of him requiring critical thinking skills. Currently the firm’s soda sales account for 70 percent of global revenue.1 And though that number is impressive, it is also a daunting figure because sales of carbonated beverages are steeply declining. In addition, the company is downsizing its number of employees as it tries to enter new beverage markets. These are major trials for the 52yearold Quincey. The critical thinking skills needed to tackle these issues showcase Quincey’s ability to use purposeful, goaldirected thinking to define and solve these problems. “We are moving quickly to structure our organization for faster growth and to ensure we can respond to the fastchanging needs of our consumers,” Quincey said.2 The restructuring has meant cutting 1,200 jobs at the corporate office on top of the nearly 100,000 jobs lost as Coke has

This is a special edition of an established title widely used by colleges and universities throughout the world Pearson published this exclusive edition for the benefit of students outside the United States and Canada If you purchased this book within the United States or Canada, you should be aware that it has been imported without the approval of the Publisher or Author • Management Skills Exercises provide additional discussion questions for the Challenge Case as well as an additional short case • Three Experiential Exercises at the end of each chapter help students to use active learning, manage their careers, and demonstrate the knowledge and skill acquired in that chapter FIFTEENTH EDITION • Tips for Managing Around the Globe, Steps for Success, and Practical Challenge callouts highlight the practical applications of management concepts Modern Management • Challenge Cases at the beginning of each chapter present a company facing a challenge relevant to the topic of the chapter Challenge Case Summaries at the end of each chapter demonstrate how managers have used the concepts presented in the chapter to address the challenge Concepts and Skills Today’s managers continue to face exciting new opportunities and challenges The fifteenth edition of Modern Management: Concepts and Skills combines the most seminal perspectives on management with the most current studies in the field to fulfill two objectives: maximize the student’s understanding of critical management concepts and develop related management skills Cutting-edge research on individuals, teams, and organizations is integrated with the following features to enhance students’ performance, their employability, and their careers GLOBAL EDITION GLOBAL EDITION GLOBAL EDITION Modern Management Concepts and Skills FIFTEENTH EDITION Certo • Certo Samuel C Certo • S Trevis Certo Certo_15_1292265191_Final.indd 11/1/18 3:51 PM 30 PREFACE Global Edition Acknowledgments Pearson would like to thank the following people for their work on the Global Edition: Contributors Diane Sutherland Jon Sutherland Reviewers Lindos Daou, Holy Spirit University of Kaslik Khaled Haque Vimala Venugopal, Taylor’s University, Malaysia A01_CERT5193_15_GE_FM.indd 30 24/09/18 2:49 PM Introducing Modern Management: Concepts and Skills TA R G E T S K I L L Management Skill: the ability to work with people and other organizational resources to accomplish organizational goals M A N AG E M E N T S K I L L A N D YO U R C A R E E R Management skill will be of great value to you in enhancing your career For example, this skill can help you to focus systematically on engaging organizational resources to meet profit goals Profit making will contribute to organizational success, build your image as a competent manager, make you valuable to your organization, and support promotions as you build your career OBJECTIVES To help build my management skill, when studying this chapter, I will attempt to acquire: 1-1 An understanding of a manager’s task 1-2 Knowledge about the management process and organizational resources 1-3 An understanding of management skill as the key to management success 1-4 Insights concerning what management careers are and how they evolve MyLab Management Chapter Warm Up If your instructor has assigned this activity, go to www.pearson.com/mylab/management to complete the chapter warm up M01_CERT5193_15_GE_C01.indd 31 31 14/09/18 2:35 PM CHALLENGE CASE Coke’s New CEO Battles a Changing Market his chapter focuses on a number of introductory management topics, but one key concept is that of management employability skills (communication, critical thinking, creativity, collaboration, knowledge application, and ethics and social responsibility) The new CEO of Coca-Cola is a great example of all six of these management employability skills Coca-Cola is a brand that has been around for over 130 years The iconic logo script, contoured shape of the bottle, and bubbly taste have made Coke one of the most recognizable brands in the world The beverage giant has enjoyed a worldwide popularity envied by most consumer companies However, the last 10 years have been tough on Coke and on the carbonated beverage industry in general Bottled water has supplanted soda as the most commonly purchased drink in the United States, and cities have begun taxing carbonated beverages heavily in hopes of raising funds and curbing obesity and diabetes In this current turbulent climate, James Quincey took the reins as CEO of the soda giant in 2017 Beginning his career with Coke in 1996, he oversaw operations in Latin America and Europe and worked his way up to chief operating officer, learning along the way the employability skill of knowledge application Each position he filled in his career with the company taught him something new that he could utilize in subsequent positions The former CEO, Muhtar Kent, had held the position for years and groomed Quincey to take over the helm upon his departure Quincey has a number of challenges ahead of him requiring critical thinking skills Currently the firm’s soda sales account for 70 percent of global revenue.1 And though that number is impressive, it is also a daunting figure because sales of carbonated beverages are steeply declining In addition, the company is downsizing its number of employees as it tries to enter new beverage markets These are major trials for the 52-year-old Quincey The critical thinking skills needed to tackle these issues showcase Quincey’s ability to use purposeful, goal-directed thinking to define and solve these problems “We are moving quickly to structure our organization for faster growth and to ensure we can respond to the fastchanging needs of our consumers,” Quincey said.2 The restructuring has meant cutting 1,200 jobs at the corporate office on top of the nearly 100,000 jobs lost as Coke has Pascal Le Segretain/Getty Images T James Quincey, new CEO of The Coca-Cola Company, will need his broad-based knowledge to face current competitive challenges sold off bottling operations since 2012 This is important as the company refocuses its efforts on products such as sports drinks, tea, plant-based beverages, bottled water, and flavored water—a major departure from the tried-andtrue carbonated namesake of the firm Quincey understands that if Coke is to continue to compete with Pepsi and Dr Pepper Snapple, he has to create new revenue streams while significantly cutting costs This means making tough decisions about reducing staff and taking risks with the introduction of new products As consumers seek out healthier options, the beverages of 20 years ago are no longer the top sellers People want less sugar and fewer calories, and they want to feel good about what they are consuming This embodies the employability skill of ethics and social responsibility Coke’s voluntary decision to manufacture a beverage that helps contribute to the reduction of diabetes and the number of obese consumers demonstrates the company’s commitment to implementing strong ethical and socially responsible choices It will be crucial for Quincey to communicate with his team about this trend This is a critical management employability skill that is highly desirable by organizations, and Quincey’s ability to convey the information effectively to his associates will be critical for Coke’s success Coke, under Quincey, is entering a new era where deliberate management initiatives will maintain the strong market position the company has enjoyed However, changes to a company built on a single carbonated beverage product 32 M01_CERT5193_15_GE_C01.indd 32 14/09/18 2:35 PM CHAPTER   Introducing Modern Management: Concepts and Skills  33 are a necessity In addition, Quincey is effectively demonstrating the six management employability skills that are discussed in this chapter According to Quincey, “The brand Coca-Cola will always be the heart and soul of The Coca-Cola Company, but the company has outgrown its core brand The company needs to be bigger than our core brand We’ve been very clear that for us to drive sustainable, profitable growth of our brands, we also need to encourage and enable our consumers to control added sugar consumption.”3 THE MODERN MANAGEMENT CHALLENGE The Challenge Case illustrates a few of the ways that James Quincey will need his personal management skills at Coke After studying chapter concepts, read the Challenge Case Summary at the end of the chapter to help you to relate chapter content to developing management skills to inspire innovation A Manager’s Task Managers influence all phases of modern organizations Plant managers run manufacturing operations that produce the clothes we wear, the food we eat, and the automobiles we drive Sales managers maintain a sales force that markets goods Personnel managers provide organizations with a competent and productive workforce The “jobs available” section in the classified advertisements of any major newspaper describes many different types of management activities and confirms the importance of management Managers are also important because they serve a very special purpose in our lives They are the catalysts for new and exciting products of all kinds that keep our economy and standard of living moving forward One such new product of today is the Transportable Exam Station (TES), which brings the doctor to you Other such products include Apple’s new head-mounted iPhone, Microsoft’s new tablet called Surface, and Chevrolet’s new electric car called Volt In addition to understanding the significance to managers and society of managerial work and its related benefits, prospective managers need to know what the management task entails The sections that follow introduce the basics of the management task through discussions of the roles and definitions of management, the management process as it pertains to management functions and organizational goal attainment, and the need to manage organizational resources effectively and efficiently Our society could neither exist as we know it today nor improve without a steady stream of managers to guide its organizations Peter Drucker emphasized this point when he stated that effective management is probably the main resource of developed countries and the most needed resource of developing ones.4 In short, all societies desperately need good managers Management is important to society as a whole as well as vital to many individuals who earn their livings as managers Government statistics show that management positions have increased from approximately 10 to 18 percent of all jobs since 1950 Managers come from varying backgrounds and have diverse educational specialties Many people who originally train to be accountants, teachers, financiers, or even writers eventually make their livelihoods as managers Although in the short term, the demand for managers varies somewhat, in the long term, managerial positions can yield high salaries, status, interesting work, personal growth, and feelings of accomplishment The Associated Press has recently ranked total compensation paid to top managers in the United States Based on the 2016 ranking, Table 1.1 shows the names of the 10 most highly paid chief executives, the company they worked for, and how much they earned An inspection of the list of highest-paid executives in Table 1.1 reveals that the overwhelming majority of the top-paid executives are men Based on the results of a recent survey at the Wall Street Journal, Figure 1.1 illustrates a broad salary gap between men and women Whereas women and men make up roughly the same proportion of the workforce, men hold a disproportionate number of higher-paying jobs according to the figure In addition, a notable study by the American Association of University Women indicated that the discrepancy between the pay of men versus the pay of women is a national phenomenon M01_CERT5193_15_GE_C01.indd 33 1-1 An understanding of a manager’s task 14/09/18 2:35 PM 34 PART 1  Introduction to Modern Management TABLE 1.1  The 10 Highest-Compensated CEOs, 2016 Ranking CEO Name Company Name Paid ($ millions) Dara Khosrowshahi Expedia 94.6 Leslie Moonves CBS 56.4 Philippe Dauman Viacom 54.1 Leonard Schleifer Regeneron Pharmaceuticals 47.5 Robert Iger Walt Disney 43.5 Sandeep Mathrani General Growth Properties 39.2 Brian Roberts Comcast 36.2 Marissa Mayer Yahoo 36 David Cote Honeywell International 33.8 10 Marc Benioff Salesforce.com 33.4 Source: “Top 10 Highest-Paid CEOs,” The Associated Press, May 25, 2016 and is not isolated to a particular state or region.5 As a general trend, however, the gap has narrowed since the 1970s due largely to women’s progress in education and workforce participation and to men’s wages rising at a slower rate.6 Concerns that certain managers are paid too much have been raised For example, consider the notable criticism in recent years regarding the high salary paid to Robert R Nardelli, former CEO of Home Depot.7 Disapproval of the excessive compensation paid to Nardelli surfaced in the popular press as well as in statements by stockholders An article in the Wall Street Journal, for example, questioned whether Nardelli was worth the amount he received.8 Nardelli had been paid $63.5 million during a five-year period at Home Depot, while company shares lost percent of their value In the end, as with any manager, Nardelli’s compensation should have been determined by how much value he added to the company The more value he added, the more compensation he deserved As a result of the growing criticism about Nardelli’s compensation and Nardelli’s resistance to modify his compensation level, he was fired Some evidence suggests that societal concern about management compensation goes well beyond one manager at one company.9 A recent Senate Commerce Committee meeting, for example, focused on trying to justify lavish pay programs for managers at companies such as Tyco International and American Airlines when the companies were in financial trouble and laying off employees Senators seemed unified in questioning the logic that justifies the average CEO salary being more than 400 times higher than a production worker’s wages This Senate Commerce Committee meeting should be an important signal that managers who not exercise judicious self-control about their salaries may face future legislative control Figure 1.1 The salary gap between genders 60% 50% 40% 47% Men 53% 30% 20% 6% 0% % of the workforce M01_CERT5193_15_GE_C01.indd 34 Men 20 % Men 16% 10% % earning $75,000 or more 12 % % earning $50,000– $75,000 14/09/18 2:35 PM CHAPTER   Introducing Modern Management: Concepts and Skills  35 Essentially, the role of managers is to guide organizations toward goal accomplishment All organizations exist for certain purposes or goals, and managers are responsible for combining and using organizational resources to ensure that their organizations achieve their purposes Management moves an organization toward its purposes or goals by assigning activities for organization members to perform If the activities are designed effectively, the production of each individual worker will contribute to the attainment of organizational goals Management strives to encourage individual activity that will lead to reaching organizational goals and to discourage individual activity that will hinder the accomplishment of those goals Because the process of management emphasizes the achievement of goals, managers must keep organizational goals in mind at all times.10 ESB Professional/Shutterstock The Role of Management Defining Management Students of management should be aware that the term management can be (and often is) used in different ways For instance, it can refer simply to the process that managers follow in order to accomplish organizational goals It can also refer to a body of knowledge; in this context, management is a cumulative body of information that furnishes insights on how to manage The term management can also refer to the individuals who guide and direct organizations or to a career devoted to the task of guiding and directing organizations An understanding of the various uses and related definitions of the term will help you avoid miscommunication during management-related discussions As used most commonly in this text, management is the process of reaching organizational goals by working with and through people and other organizational resources A comparison of this definition with the definitions offered by several contemporary management thinkers indicates broad agreement that management encompasses the following three main characteristics: This manager works with people and other resources to achieve the organization’s goals It is a process or series of continuing and related activities It involves and concentrates on reaching organizational goals It reaches these goals by working with and through people and other organizational resources A discussion of each of these characteristics follows The Management Process: Management Functions The four basic management functions—activities that make up the management process— are described in the following sections Planning  Planning involves choosing tasks that must be performed to attain organiza- tional goals, outlining how the tasks must be performed, and indicating when they should be performed Planning activity focuses on attaining goals Through their plans, managers outline exactly what organizations must to be successful Planning is essential to getting the “right” things done.11 Planning is concerned with organizational success in the near future (short term) as well as in the more distant future (long term).12 Organizing  Organizing can be thought of as assigning the tasks developed under the planning function to various individuals or groups within the organization Thus, organizing creates a mechanism to put plans into action People within the organization are given work assignments that contribute to the company’s goals Tasks are organized so that the output of individuals contributes to the success of departments, which in turn contributes to the success of divisions, which ultimately contributes to the success of the organization Organizing includes determining tasks and groupings of work.13 Organizing should not be rigid; it should be adaptable and flexible to meet challenges as circumstances change.14 M01_CERT5193_15_GE_C01.indd 35 14/09/18 2:35 PM 36 PART 1  Introduction to Modern Management Figure 1.2 Classic mistakes commonly made by managers in carrying out various management functions Planning Not establishing objectives for all important organizational areas Making plans that are too risky Not exploring enough viable alternatives for reaching objectives Organizing Not establishing departments appropriately Not emphasizing coordination of organization members Establishing inappropriate spans of management Influencing Not taking the time to communicate properly with organization members Establishing improper communication networks Being a manager but not a leader C o n t rolling Not monitoring progress in carrying out plans Not establishing appropriate performance standards Not measuring performance to see where improvements might be made Influencing  Influencing is another of the basic functions within the management process This function—also commonly referred to as motivating, leading, directing, or actuating—is concerned primarily with the people within organizations.15 Influencing can be defined as guiding the activities of organization members in appropriate directions An appropriate direction is any direction that helps the organization move toward goal attainment The ultimate purpose of influencing is to increase productivity Human-oriented work situations usually generate higher levels of production over the long term than task-oriented work situations because people find the latter type less satisfying Controlling  Controlling is the management function through which managers: Gather information that measures recent performance within the organization Compare present performance to preestablished performance standards From this comparison, determine whether the organization should be modified to meet preestablished standards Controlling is an ongoing process Managers continually gather information, make their comparisons, and then try to find new ways of improving production through organizational modification History shows that managers commonly make mistakes when planning, organizing, influencing, and controlling Figure 1.2 shows a number of such mistakes managers make related to each function Studying this text carefully should help managers avoid making such mistakes Management Process and Organizational Resources 1-2 Knowledge about the management process and organizational resources M01_CERT5193_15_GE_C01.indd 36 Although we have discussed the four functions of management individually, planning, organizing, influencing, and controlling are integrally related and therefore cannot be separated in practice Figure 1.3 illustrates this interrelationship and also indicates that managers use these activities solely for reaching organizational goals Basically, these functions are interrelated because the performance of one depends on the performance of the others For example, organizing is based on well-thought-out plans developed during the planning process, and influencing systems must be tailored to reflect both these plans and the organizational design used to implement them The fourth function, controlling, involves possible modifications to existing plans, organizational structure, or the motivation system used to develop a more successful effort To be effective, a manager must understand how the four management functions are practiced, not simply how they are defined and related Thomas J Peters and Robert H Waterman, Jr., studied 14/09/18 2:35 PM CHAPTER   Introducing Modern Management: Concepts and Skills  37 Figure 1.3 Organizational Goals Relationships among the four functions of management used to attain organizational goals Planning Influencing Controlling Organizing numerous organizations—including Frito-Lay and Maytag—for several years to determine what management characteristics best describe excellently run companies In their book In Search of Excellence, Peters and Waterman suggest that planning, organizing, influencing, and controlling should be characterized by a bias for action; a closeness to the customer; autonomy and entrepreneurship; productivity through people; a hands-on, value-driven orientation; “sticking to the knitting”; a simple organizational form with a lean staff; and simultaneous loose–tight properties This brief introduction to the four management functions will be developed further in Parts through of this text Management and Organizational Resources Management must always be aware of the status and use of organizational resources These resources, composed of all assets available for activation during the production process, are of four basic types: Human Monetary Raw materials Capital As Figure 1.4 shows, organizational resources are combined, used, and transformed into finished products during the production process Human resources are the people who work for an organization The skills they possess and their knowledge of the work system are invaluable to managers Monetary resources are the P R A C T I C A L C H A L L E N G E : AT TA I N I N G G O A L S Lawrence Jones Motivates Employees at UKFast T o understand how some managers influence goal attainment, consider UKFast’s CEO and founder Lawrence Jones UKFast a business-to-business hosting company, was founded in 1999, and since then Jones has used his creative leadership and passion to inspire others and attain the organization’s goals—to create a global presence and build on its estimated worth of $315 million He feels that motivation is one of the biggest assets a business can use to increase productivity and compete globally Jones likes a hands-on approach He takes an active role in guiding his senior management and focuses on ensuring that UKFast and its customers M01_CERT5193_15_GE_C01.indd 37 grow side-by-side Managers are trained to keep employees geared for more by looking at three factors—competition, environment, and development Jones encourages his employees to look to competition as a driver and a goal-setter According to reports,16 Jones has instilled a healthy appetite for competition in an informal way by initiating annual internal competitions among the company’s technical engineers and by announcing the top 10 customer services delivered every week The winners are treated to a big reward While goals are attained, Jones feels the best part is that most of the employees enjoy the challenge itself 25/09/18 3:33 PM 38 PART 1  Introduction to Modern Management Figure 1.4 Transformation of organizational resources into finished products through the production process Organizational Resources People Money Raw materials Capital resources Inputs Production Process Outputs Finished Products Goods Services amounts of money that managers use to purchase goods and services for the organization Raw materials are the ingredients used directly in the manufacturing of products For example, rubber is a raw material that Goodyear would purchase with its monetary resources and use directly in manufacturing tires Capital resources are the machines used during the manufacturing process Modern machines, or equipment, can be a major factor in maintaining desired production levels Worn-out or antiquated machinery can make it impossible for an organization to keep pace with competitors Managerial Effectiveness  As managers use their resources, they must strive to be both effective and efficient Managerial effectiveness refers to management’s use of organizational resources in meeting organizational goals If organizations are using their resources to attain their goals, the managers are declared effective In reality, however, managerial effectiveness can be measured by degrees The closer an organization comes to achieving its goals, the more effective its managers are considered Thus, managerial effectiveness exists on a continuum ranging from ineffective to effective Managerial Efficiency  Managerial efficiency is the proportion of total organizational resources that contribute to productivity during the manufacturing process.17 The higher this proportion, the more efficient is the manager The more resources wasted or unused during the production process, the more inefficient is the manager In this situation, organizational resources refer not only to raw materials that are used in manufacturing goods or services but also to related human effort.18 Like management effectiveness, management efficiency is best described as being on a continuum ranging from inefficient to efficient Inefficient means that a small proportion of total resources contributes to productivity during the manufacturing process; efficient means that a large proportion of resources contributes to productivity As Figure 1.5 shows, the concepts of managerial effectiveness and efficiency are obviously related A manager could be relatively ineffective—with the consequence that the organization is making little progress toward goal attainment—primarily because of major inefficiencies or poor utilization of resources during the production process In contrast, a manager could be Figure 1.5 RESOURCE USE Various combinations of managerial effectiveness and managerial efficiency Efficient (most resources contribute to production) Not reaching goals and not wasting resources Reaching goals and not wasting resources Inefficient (few resources contribute to production) Not reaching goals and wasting resources Reaching goals and wasting resources Ineffective Effective (little progress toward (substantial progress organizational goals) toward organizational goals) GOAL ACCOMPLISHMENT M01_CERT5193_15_GE_C01.indd 38 14/09/18 2:36 PM Effective Communication and IT Management 445 its members perform the activities necessary to achieve its stated goals.42 Managers achieve control over organizational activities by taking four steps (see Figure 8.2): (1) They establish measurable standards of performance or goals; (2) they measure actual performance; (3) they compare actual performance against established goals; and (4) they evaluate the results and take corrective action if necessary.43 UPS, for example, has a goal to deliver 99% of next-day packages by noon.44 UPS has thousands of U.S operating facilities that are responsible for the physical pickup and delivery of packages UPS managers monitor the delivery performance of these facilities regularly; if they find that the 99% goal is not being attained, the managers determine why and take corrective action as necessary To achieve control over any organizational activity, managers must have information To control the activities at UPS operating facilities, a UPS manager might need to know what percentage of packages each facility delivers by noon To obtain this information, the manager uses UPS’s own information systems; UPS is also a leader in developing proprietary in-house IT All packages to be shipped are scanned with handheld computers by UPS drivers who pick them up; then all this information is sent wirelessly through UPS servers to its headquarters’ mainframe computer When the packages are scanned again at delivery, this information is also transmitted through the company’s extensive computer network Managers can access this information quickly to discover what percentage of packages were delivered by noon of the day after they were picked up, and also how this information breaks down facility by facility so they can intervene if delivery goals are not being met Management information systems are used to control all divisional and functional operations In accounting, for example, information systems are used to monitor expenditures and compare them against budgets To track expenditures against budgets, managers need information about current expenditures, broken down by relevant organizational units; accounting IT is designed to give managers this information A twist on using technology to collect data and improve customer service is used at Walt Disney World and its resorts Worn on the wrist or carried in a special holder, the colorful MagicBand is an all-in-one device that not only connects visitors’ travel experiences but also helps Disney collect information about its customers and how they spend their time at the theme parks The MagicBand uses radiofrequency technology that can be read by devices all over Disney World and its resorts, and it can act as a room key and to make purchases throughout a visitor’s stay.45 Information and Coordination Coordinating department and divisional activities to achieve organizational goals is another basic task of management As an example of the size of the coordination task that managers face, consider the coordination effort necessary to prepare between 500,000 and million meals for the people who visit Disney parks and resorts every day Combine that type of volume with Disney’s efforts to get food locally, and logistics get complicated quickly According to Lenny DeGeorge, executive chef for concept development at Walt Disney Parks & Resorts, the supply chain for the restaurants at the Disney parks and resorts worldwide—all 1,040 of them— depends on the location of the resort and what local growers and producers can provide In Florida, for example, the company works with “Fresh from Florida” to find out what is in season and available In Southern California, Disney has some local growers providing organic produce DeGeorge and his Disney culinary colleagues have recently moved into the Flavor Lab, a new Orlando facility that will provide 446 Chapter Thirteen professional and creative workspace for Disney food service employees to test new equipment, try out new recipes, and showcase best practices.46 Another example of coordinating department and divisional activities involves Starbucks’s program called “Origin Experience,” which allows employees to get involved in the logistics of the company’s supply chain and share information they learn with their colleagues and employees Origin Experience allows associates to travel overseas and meet Starbucks partners where coffee beans are grown The trips and resulting experience provide Starbucks employees with a new perspective on the supply chain and the coffee that is served in its stores around the world For her Origin Experience, a store manager from Shoreline, Washington, flew to Costa Rica to see the coffee-growing experience firsthand While there, the manager picked and tasted red coffee cherries, which are removed from coffee beans during processing, as well as raked the beans while they dried in the hot sun She was amazed at the human interactions with local farmers, the high ­standards Starbucks places on its growers, and the company’s commitment to ethical sourcing of its global supply chain.47 These visits help Starbucks employees learn about the supply chain, how to make it run more smoothly, and provide information associates can share and use as part of their everyday work experiences Advances in Information Technology LO 13.5 Describe the advances in IT and their impact on management and business operations Advances in information technology have enabled managers to take gigantic leaps in the way they collect more timely, complete, relevant, and high-quality information and use it in more effective ways To better understand the ongoing revolution in IT that has transformed companies and the way they business, we need to examine several key factors of information technology The Effects of Advancing IT The products and services that result from advancing IT are all around us—ever more powerful microprocessors and PCs, high-bandwidth smartphones, sophisticated word-processing software, ever-expanding computer networks, inexpensive digital cameras and game consoles, and more and more useful online information and retailing services that did not exist a generation ago These products are commonplace and are being continuously improved Many managers and companies that helped develop the new IT have reaped enormous gains However, while many companies have benefited from advancing IT, others have been threatened Traditional telephone companies such as AT&T, Verizon, and other long-distance companies the world over have seen their market dominance threatened by companies offering Internet, broadband, and wireless technology They have been forced to respond by buying wireless cellphone companies, building their own high-powered broadband networks, and forming alliances with companies such as Apple and Samsung to make phones that will work on their networks So advancing IT is both an opportunity and a threat, and managers have to move quickly to protect their companies and maintain their competitive advantage As the accompanying “Management Insight” feature describes, advances in IT are commonplace in the form of wearables used by companies to track employee performance Effective Communication and IT Management 447 Management Insight Wearables Help Improve Employee Performance Imagine you are sitting at your desk, writing a report on your computer How will the boss know how productive you are? She could install a program that monitors the number of keystrokes you make on the computer or monitor your behavior from her office But there’s a new and more efficient way for managers to know everything you during the workday Imagine that while you’re working, you are wearing a sensor, just like your employee ID badge, on a lanyard around your neck The sensor picks up your body movements, voice inflections, and environmental factors like lighting and temperature It records that you are sitting at your desk, busily typing your report After 30 minutes, you start to feel a bit fatigued The badge notes that your pace has slowed After an hour, you decide to take a short break before your upcoming meeting The badge records your movements from your desk to the break room where you run into a colleague who asks about your fantasy team You are excited about the team, and the device records to whom you are speaking (if the person is wearing a sensor) and the level of enthusiasm in your voice Then the badge tracks your movements from the break room to the conference room for your meeting This sensor is called a “wearable” and allows companies to track where employees are, what they’re doing, and how enthusiastically they are doing it Although somewhat like pedometers, wearables much more than just measure steps Companies can use wearables to compare how animated a worker is around certain colleagues Wearables can also tell in which meetings a worker participates actively and in which meetings the worker prefers to remain quiet Wearables come in the form of smart watches, eyeglasses, earpieces, badges, and other devices.48 For example, a small camera in a pair of “smart glasses” developed by Vuzix can be worn by distribution center workers to automatically scan bar codes and provide information to the worker in a visual display The glasses can also warn workers if an item is fragile or needs to be picked up a certain way The glasses connect to software that tracks the flow of workers throughout the distribution center.49 Many sports teams use wearables in practice sessions, and the benefits are paying off for both teams and players For example, a wearable device from Catapult Sports helps coaches confirm that Companies and sports teams use wearable technology to track performance and collect productivity data The athlete shown above is wearing a Catapult vest that includes a players are fatigued by colheart monitor. ©AMA/Corbis/Getty Images lecting data about players’ movement intensity and acceleration The information helps pinpoint when players are fatigued, which may leave them vulnerable to injuries During the 2015 NBA championship run by the Golden State Warriors, players routinely wore wearables during practice, which provided coaches with data to alert them when players were “reaching their limits” when it came to being tired This information helped coach Steve Kerr decide when to sit players rather than play them during the long NBA season.50 Wearables can provide valuable data that can be used to improve productivity But there are problems as well Workers may feel that wearables infringe on their privacy, that they are never alone at work, even in the bathroom Also, workers may feel that the only purpose of the wearable is to improve outcomes in efficiency or productivity for the company.51 One organization that uses wearables, Sociometric Solutions, suggests reassuring employees that their privacy is protected by letting them know what is being tracked, telling them that managers will see aggregate data, not each individual’s data, and making participation voluntary Ben Waber, the company’s president and CEO, says, “What we’re trying to is really quantify what people have always felt to be unquantifiable Things like, how are people interacting with each other? How you talk to customers? How engaged are you in a conversation? And how is information flowing in an organization?”52 IT and the Product Life Cycle product life cycle  The way demand for a product changes in a predictable pattern over time 448 When IT is advancing, organizational survival requires that managers quickly adopt and apply it One reason for this is how IT affects the length of the product life cycle, which is the way demand for a product changes in a predictable ­pattern over time In general, the product life cycle consists of four stages: the embryonic, growth, maturity, and decline stages (see Figure 13.4) In the embryonic stage a product has yet to gain widespread acceptance; customers are unsure what a product, such as a new smartphone, has to offer, and demand for it is minimal As a product, like Apple’s iPad, becomes accepted by customers demand takes off and the product enters its growth stage In the growth stage many consumers are entering the market and buying the product for the first time, and demand increases rapidly This is the stage iPhones and iPads passed through with great success Of course these products’ future success will depend on the value customers see in the collection of IT applications they offer—and how fast competitors such as Samsung and Google move to offer similar and less expensive tablet computers and smartphones The growth stage ends and the maturity stage begins when market demand peaks because most customers have already bought the product (there are relatively few first-time buyers left) At this stage, demand is typically replacement demand Once a demand for a product starts to fall, the decline stage begins This typically occurs when advancing technology leads to the development of a more advanced product, making the old one obsolete In the case of the decline of the iPod, it was another Apple product that put the iPod into decline: the iPhone The Apple Watch was introduced by the company in 2015 and had its best quarter ever in late 2016—with sales of more than million The watch seems to be solidly in the growth stage of the product life cycle with nearly a 50% market share for digital watches However, some competitors, like the FitBit Blaze and the Samsung Gear, may be gaining ground.53 449 Effective Communication and IT Management Figure 13.4 A Product Life Cycle Growth stage Maturity stage Decline stage Demand Embryonic stage Time In general, demand for every generation of a digital device such as a PC, smartphone, or tablet falls off when the current leaders’ technology is superseded by new products that incorporate the most recent IT advances One reason the IT revolution is so important for managers is that advances in technology are one of the most significant determinants of the length of a product’s life cycle, as well as the level of competition in an industry The Network of Computing Power The tumbling price of computing power and applications has allowed all kinds of organizations, large and small, to invest more into developing networks of computer services customized with the right mix of hardware and software to best meet their needs The typical organizationwide computing network that has emerged over time is a four-tier network solution that consists of “external” mobile computing devices such as netbooks, smartphones, and tablet computers, connected to desktops and laptops, and then through “internal” rack servers to a company’s mainframe Through wireless and wired communication an employee with the necessary permissions can hook into a company’s IT system from any location—in the office, at home, on a boat, on the beach, in the air— anywhere a wireless or wired link can be established The Apple Watch has gained worldwide acceptance and is in the growth stage of the product life cycle. ©Prykhodov/123RF network  Interlinked computers that exchange information 450 Chapter Thirteen Just as computer hardware has been advancing rapidly, so has computer software Operating system software tells the computer hardware how to run Applications software, such as programs for word processing, spreadsheets, graphics, and database management, is developed for a specific task or use The increase in the power of computer hardware has allowed software developers to write increasingly powerful programs that are also increasingly user-friendly By harnessing the rapidly growing power of microprocessors, applications software has vastly increased the ability of managers to acquire, organize, and communicate information In doing so, it also has improved the ability of managers to coordinate and control the activities of their organization and to make better decisions Types of Management Information Systems Advances in IT have continuously increased managers’ ability to obtain the information they need to make better decisions and coordinate and control organizational resources Next we discuss six types of management information systems (MIS) that have been particularly helpful to managers as they perform their management tasks (see Figure 13.5) These MIS systems are arranged along a continuum according to the sophistication of the IT they are based on—IT that determines their ability to give managers the information they need to make nonprogrammed decisions (Recall from Chapter that nonprogrammed decision making occurs in response to unusual, unpredictable opportunities and threats.) We examine each of these systems after focusing on the management information system that preceded them all: the organizational hierarchy LO 13-6 Explain the differences between six different kinds of management information systems The Organizational Hierarchy: The Traditional Information System Traditionally, managers have used the organizational hierarchy as a system for gathering the information they need to achieve coordination and control and make decisions (see Chapter for a discussion of organizational structure and hierarchy) According to business historian Alfred Chandler, the use of the hierarchy as an information network was perfected by railroad companies in the United States during the 1850s.54 At that time, the railroads were the largest industrial organizations in the United States By virtue of their size and geographical spread, they faced unique problems of coordination and control In the 1850s, they started to solve these problems by designing hierarchical management structures that provided Figure 13.5  Six Computer-Based Management Information Systems Transactionprocessing systems Programmed decision making Operations information systems Decision support systems Expert systems Enterprise resource planning systems E-commerce systems Nonprogrammed decision making information distortion  Changes in meaning that occur as information passes through a series of senders and receivers transactionprocessing system  A management information system designed to handle large volumes of routine, recurring transactions operations information system  A management information system that gathers, organizes, and summarizes comprehensive data in a form that managers can use in their nonroutine coordinating, controlling, and decision-making tasks Effective Communication and IT Management 451 senior managers with the information they needed to achieve coordination and control and to make decisions about running the railroads Daniel McCallum, superintendent of the Erie Railroad in the 1850s, realized that the lines of authority and responsibility defining the Erie’s management hierarchy also represented channels of communication along which information traveled McCallum established what was perhaps the first modern management information system Regular daily and monthly reports were fed up the management chain so that top managers could make decisions about, for example, controlling costs and setting freight rates Decisions were then relayed back down the hierarchy so they could be carried out When performance gains from this system were publicized, many organizations imitated the railroads by using their hierarchies to collect, channel, and process information Although organizational hierarchy is a useful information system, it has several drawbacks First, when too many layers of managers exist, it takes a long time for information and requests to travel up the hierarchy and for decisions and answers to travel back down The slow communication can reduce the timeliness and usefulness of the information and prevent a quick response to changing market conditions Second, information can be distorted as it moves from one layer of management to another Information distortion, changes in meaning that occur as information passes through a series of senders and receivers, reduces the quality of information.55 Third, managers have only a limited span of control; so, as an organization grows larger and its hierarchy lengthens, more managers must be hired, and this makes the hierarchy an expensive (and sometimes ineffective) information system The popular idea that companies with tall management hierarchies are bureaucratic and unresponsive to the needs of their customers arises from the inability of tall hierarchies to effectively process data and give managers timely, complete, relevant, and high-quality information The management hierarchy is still the best information system available today—the one that results in the best decisions—if managers have access to the other kinds of management information systems discussed next Transaction-Processing Systems A transaction-processing system is a system designed to handle large volumes of routine, recurring transactions Transaction-processing systems began to appear in the early 1960s with the advent of commercially available mainframe computers They were the first type of computer-based IT adopted by many organizations, and today they are commonplace Bank managers use a transaction-processing system to record deposits into, and payments out of, bank accounts Supermarket managers use a transaction-processing system to record the sale of items and to track inventory levels More generally, most managers in large organizations use a transaction-processing system to handle tasks such as payroll preparation and payment, customer billing, and payment to suppliers Operations Information Systems Many types of management information systems followed hard on the heels of transaction-processing systems in the 1960s An operations information system is a system that gathers comprehensive data, organizes it, and summarizes it in a form that is of value to managers Whereas a transaction-processing system processes routine transactions, an operations information system provides managers with information that they can use in their nonroutine coordinating, controlling, and decision-making tasks Most operations information systems are coupled with a 452 Chapter Thirteen transaction-processing system An operations information system typically accesses data gathered by a transaction-processing system, processes those data into useful information, and organizes that information into a form accessible to managers As described in the earlier “Management Insight” feature, data collected by wearables could be part of an operations information system Decision Support Systems decision support system  An interactive computer-based management information system with modelbuilding capability that managers can use when they must make nonroutine decisions A decision support system is an interactive computer-based system that provides models that help managers make better nonprogrammed decisions.56 Recall from Chapter that nonprogrammed decisions are decisions that are relatively unusual or novel, such as decisions to invest in new productive capacity, develop a new product, launch a new promotional campaign, enter a new market, or expand internationally Although an operations information system organizes important information for managers, a decision support system gives managers a model-building capability and so provides them with the ability to manipulate information in a variety of ways Managers might use a decision support system to help them decide whether to cut prices for a product The decision support system might contain models of how customers and competitors would respond to a price cut Managers could run these models and use the results as an aid to decision making The emphasis on the word aid is important, for in the final analysis a decision support system is not meant to make decisions for managers Rather, its function is to provide valuable information that managers can use to improve the quality of their decision making Artificial Intelligence and Expert Systems artificial intelligence (AI)  Behavior performed by a machine that, if performed by a human being, would be called “intelligent.” expert system  A management information system that utilizes human knowledge embedded in computer software to solve problems that ordinarily require human expertise Artificial intelligence (AI) has been defined as behavior by a machine that, if performed by a human being, would be called “intelligent.” This behavior has already made it possible to write programs that can solve problems and perform simple tasks For example, software programs variously known as software agents, softbots, or knowbots can be used to perform simple managerial tasks such as sorting through reams of data or incoming email messages to look for important ones The interesting feature of these programs is that from “watching” a manager sort through such data, they can “learn” what the manager’s preferences are when reviewing information With this type of capability, these “smart” programs can take over some of the work for managers, freeing them up to work on other tasks Many of these AI programs are being used in business as well as in the home In 2016, AI start-ups came on line at a record rate due to unprecedented funding by venture capitalists, among others.57 Expert systems, the most advanced management information systems available, incorporate artificial intelligence in their design An expert system is a system that utilizes human knowledge embedded in computer software to solve problems that ordinarily require human expertise Mimicking human expertise (and intelligence) requires technology that can, at a minimum, (1) recognize, formulate, and solve a problem; (2) explain the solution; and (3) learn from the experience Enterprise Resource Planning Systems To achieve high performance, it is not sufficient just to develop a management information system within each of a company’s functions or divisions to provide better information and knowledge It is also vital that managers in the different functions enterprise resource planning (ERP) systems  Multimodule application software packages that coordinate the functional activities necessary to move products from the design stage to the final customer stage e-commerce  Trade that takes place between companies, and between companies and individual customers, using technology and the Internet business-tobusiness (B2B) commerce  Trade that takes place between companies using technology and the Internet to link and coordinate the value chains of different companies B2B marketplace  An Internet-based trading platform set up to connect buyers and sellers in an industry business-tocustomer (B2C) commerce  Trade that takes place between a company and individual customers using technology and the Internet Effective Communication and IT Management 453 and divisions have access to information about the activities of managers in other functions and divisions The greater the flow of information and knowledge among functions and divisions, the more learning can take place, and this builds a company’s stock of knowledge and expertise This knowledge and expertise are the source of its competitive advantage and profitability Over the past 25 years, another revolution has taken place in IT as software companies have worked to develop enterprise resource planning systems, which essentially incorporate most MIS aspects just discussed, as well as much more Enterprise resource planning (ERP) systems are multimodule application software packages that allow a company to link and coordinate the entire set of functional activities and operations necessary to move products from the initial design stage to the final customer stage Some of the business applications in these software packages may include accounting, customer service management (CRM), human resources, manufacturing, and inventory and supply chain management.58 Essentially ERP systems (1) help each individual function improve its functional-level skills and (2) improve integration among all functions so they work together to build a competitive advantage for the company Today, choosing and designing an ERP system to improve how a company operates is the biggest challenge facing the IT function inside a company E-Commerce Systems E-commerce is trade that takes place between companies and between companies and individual customers using technology and the Internet Business-to-business (B2B) commerce is trade that takes place between companies using technology and the Internet to link and coordinate the value chains of different companies The goal of B2B commerce is to increase the profitability of making and selling goods and services Through the use of technology, B2B commerce increases profitability because it allows companies to reduce operating costs and may improve overall quality A principal B2B software application is B2B marketplaces, which are Internet-based online trading platforms set up in many industries to connect buyers and sellers To participate in a B2B marketplace, companies adopt a common software standard that allows them to search for and share information with each other The companies can work together over time to reduce costs or improve quality Business-to-customer (B2C) commerce is trade that takes place between a company and individual customers using technology and the Internet Using technology to connect directly to customers allows companies to avoid using intermediaries, such as wholesalers and retailers, who capture a significant part of the profit in the value chain The use of websites and online stores also lets companies give their customers and other consumers much more information about the value of their products This use of technology often allows companies to attract more customers and thus generate higher sales revenues In the 2010s, software companies such as Microsoft, Oracle, SAP, and IBM are using cloud computing to make their products work seamlessly while responding to global companies’ growing demand for e-commerce software Previously, their software was configured to work only on a particular company’s internal website Today, software must be able to network a company’s IT systems to other companies, such as suppliers and distributors The challenge facing managers now is to select e-commerce software that allows a seamless exchange of information between companies anywhere in the world The stakes are high because global competitive advantage goes to the company that is first with a new major technological advance 454 Chapter Thirteen In summary, by using advanced types of MIS, managers have more control over a company’s activities and operations and can work to improve its competitive advantage and profitability The IT function has become increasingly important because IT managers decide which kind of hardware and software a company will use and then train other functional managers and employees how to use it effectively as part of daily business operations Summary and Review COMMUNICATION AND MANAGEMENT Com- munication is the sharing of information between two or more individuals or groups to reach a common understanding Good communication is necessary for an organization to gain a competitive advantage Communication occurs in a cyclical process that entails two phases: transmission and feedback [LO 13-1, 13-2] INFORMATION RICHNESS AND COMMUNICATION MEDIA Informa- tion richness is the amount of information a communication medium can carry and the extent to which the medium enables the sender and receiver to reach a common understanding Four categories of communication media in descending order of information richness are face-to-face communication (including videoconferences); spoken communication transmitted electronically (including voice mail); personally addressed written communication (including email); and impersonal written communication [LO 13-3] INFORMATION AND THE MANAGER’S JOB Computer-based information systems are central to the operation of most organizations By providing managers with high-quality, timely, relevant, and relatively complete information, properly implemented information systems can improve managers’ ability to coordinate and control the operations of an organization and to make effective decisions In addition, information systems can help the organization attain a competitive advantage through their beneficial impact on productivity, quality, innovation, and responsiveness to customers [LO 13-4] THE INFORMATION TECHNOLOGY REVOLUTION Over the past 30 years there have been rapid advances in the power and declines in the cost of information technology Falling prices, wireless communication, global computer networks, and software developments have all radically improved the power and efficiency of computer-based information systems [LO 13-5] TYPES OF MANAGEMENT INFORMATION SYSTEMS Traditionally man- agers used the organizational hierarchy as the main system for gathering information they needed to coordinate and control the organization and to make effective decisions Today, managers utilized six main types of computer-based information systems as part of their activities Listed in ascending order of sophistication, they are transactionprocessing systems, operations information systems, decision support systems, expert systems, enterprise planning (ERP) systems, and e-commerce systems [LO 13-6] Management in Action Topics for Discussion and Action Discussion that a subordinate could receive from a boss: (a) a raise, (b) not receiving a promotion, (c) an error in a report prepared by the subordinate, (d) additional job responsibilities, and (e) the schedule for company holidays for the upcoming year? Explain your choices [LO 13-3] Why is face-to-face communication between managers still important in an organization? [LO 13-1, 13-2, 13-3] What is the relationship between information systems and competitive advantage? [LO 13-3] Which medium (or media) you think would be appropriate for each of the following kinds of messages How can information technology help in the new product development process? [LO 13-5] Many companies have reported that it is difficult to implement advanced management information such as ERP systems Why you think this is so? How might the roadblocks to implementation be removed? [LO 13-6] Action Ask a manager to describe the main kinds of information systems that he or she uses on a routine basis at work [LO 13-1, 13-3] Building Management Skills Diagnosing Ineffective Communication  [LO 13-1, 13-2, 13-3] Think about the last time you experienced very ineffective communication with another person—someone you work with, a classmate, a friend, a member of your family Describe the incident Then answer the following questions: Why was your communication ineffective in this incident? What stages of the communication process were particularly problematic and why? How could you have handled this situation differently so communication would have been effective? Some companies keep track of the way their employees use IT and the Internet Is it ethical for managers to read employees’ private email or to record the sites that employees visit online? Describe any filtering or information distortion that occurred Managing Ethically  [LO 13-1, 13-2, 13-3] I n organizations today, employees often take advantage of their company’s information systems Email abuse is increasing, and so is the amount of time employees spend surfing the Internet on company time Indeed, statistics suggest that approximately 70% of the total amount of time spent surfing the Internet is company time Questions Either by yourself or in a group, explore the ethics of using IT for personal uses at work Should employees have some rights to use these resources? When does their behavior become unethical? 455 Small Group Breakout Exercise  [LO 13-1, 13-2, 13-5, 13-6] Using New Information Systems Form groups of three or four people, and appoint one member as the spokesperson who will communicate your findings to the whole class when called upon by the instructor Then discuss the following scenario Y ou are a team of managing partners of a large firm of accountants You are responsible for auditing your firm’s information systems to determine whether they are appropriate and up-to-date To your surprise, you find that although your organization does have an email system in place and accountants are connected into a powerful network, most of the accountants (including partners) are not using this technology You also find that the organizational hierarchy is still the preferred information system of the managing partners Given this situation, you are concerned that your organization is not exploiting the opportunities offered by new information systems to obtain a competitive advantage You have discussed this issue and are meeting to develop an action plan to get accountants to appreciate the need to learn, and to take advantage of, the potential of the new information technology 1 What advantages can you tell accountants they will obtain when they use the new information technology? What problems you think you may encounter in convincing accountants to use the new information technology? Discuss how you might make it easy for accountants to learn to use the new technology Be the Manager  [LO 13-1, 13-2, 13-3] A Problem in Communication ark Chen supervises support staff for an online company that sells furniture over the Internet Chen has always thought that he should expand his staff When he was about to approach his boss with such a request, the economy slowed, and other areas of the company experienced layoffs Thus, Chen’s plans for trying to add to his staff are on indefinite hold Chen has noticed a troubling pattern of communication with his staff Ordinarily, when he wants one of his staff members to work on a task, he emails the pertinent information to that person For the last few months, his email requests M 456 have gone unheeded, and his subordinates comply with his requests only after he visits with them in person and gives them a specific deadline Each time, they apologize for the delay but say that they are so overloaded with requests that they sometimes stop answering their phones Unless someone asks for something more than once, they feel a request is not particularly urgent and can be put on hold Chen thinks this situation is dysfunctional and could lead to serious problems in the near future He realizes, however, that his subordinates have no way of prioritizing tasks and that is why some very important projects were put on hold until he inquired about them Knowing that he cannot add to his staff in the short term, Chen has come to you for advice He wants to develop a system whereby his staff will provide some kind of response to requests within 24 hours, will be able to prioritize tasks, identifying their relative importance, and will not feel so overloaded that they ignore their boss’s requests and don’t answer their phones Question As an expert in communication, how would you advise Chen? Bloomberg Businessweek Case in the News This Team Runs Mark Zuckerberg’s Facebook Page Author: Sarah Frier “His image in the ­digital domain needs to be controlled.” W hen Facebook went public five years ago, the world had a pretty vivid picture of who Mark Zuckerberg was As much as anything, that image was of Jesse Eisenberg’s fictionalized performance as Zuckerberg in The Social Network: an intense, socially inept kid billionaire who always wore a hoodie, whether he was meeting with financiers or trying to screw a co-founder in court Over the past couple of years, Zuckerberg has made a concerted effort to steer his image in a different direction Near the end of 2014, he began holding Q&A sessions with groups of people wherever he was traveling around the world, fielding softballs ranging from lessons on startup-building to his favorite pizza toppings Those town halls have evolved into near-daily posts on Zuckerberg’s own Facebook page, mixing news of company milestones with personal epiphanies, soft-focus photos from his life as a new dad, and responses to user comments “What he’s learned over the last two years is that his image in the digital domain needs to be controlled,” says David Charron, who teaches entrepreneurship at the University of California at Berkeley “And he’s simply growing up.” Zuckerberg has help, lots of it Typically, a handful of Facebook employees manage communications just for him, helping write his posts and speeches, while an additional dozen or so delete harassing comments and spam on his page, say two people familiar with the matter Facebook also has professional photographers snap Zuckerberg, say, taking a run in Beijing or reading to his daughter Among them is Charles Ommanney, known most recently for his work covering the refugee crisis for the Washington Post Company spokeswoman Vanessa Chan says Facebook is an easy way for executives to connect with various audiences While plenty of chief executive officers have image managers, the scale of this team is something different So is its conflation of Zuckerberg’s personal image with that of his company, the diaper-changing photos next to the user growth stats “I don’t know that there are a lot of other business leaders that would find the same level of comfort sharing their personal and business stuff in the way that he does,” says Fred Cook, director of the University of Southern California Center for Public Relations, who has worked with Jeff Bezos and Steve Jobs Facebook’s a little different in that respect Chief Operating Officer Sheryl Sandberg has used her page to discuss workplace inequality and her husband’s sudden death And within Facebook, it’s an article of faith that Zuckerberg’s image is pretty much synonymous with the company’s, employees say If people think Zuckerberg is innovative and charming, so is Facebook That may help explain the PR team’s more ambitious recent efforts to compare the CEO to Iron Man In December, Zuckerberg, his wife, his baby daughter, his parents, and his dog all appeared in a series of videos dramatizing his yearlong effort to create a smarthome device akin to Amazon.com’s Echo Zuckerberg dubbed the project Jarvis, as in the AI butler that Robert Downey Jr uses in the Marvel movies The Facebook team shot one video from Zuckerberg’s POV, one from that of his wife, Priscilla Chan, and one from that of Jarvis, voiced by Morgan Freeman There are some cringeworthy moments, including the one after Zuckerberg asks Jarvis to play a good Nickelback song, and Freeman’s voice says there aren’t any Groans notwithstanding, the PR blitz seems to be working Zuckerberg’s posts typically get at least a couple hundred thousand shares; the Jarvis video clocked more than a million USC’s Cook says his 18-year-old son follows Zuckerberg and reported that “he seems like a regular guy.” “If an 18-yearold thinks he’s coming across in an authentic way, that’s really something,” says Cook Jarvis was Zuckerberg’s personal challenge for 2016 His stated goal this year is to travel to all 50 U.S states and improve his understanding of their communities (By contrast, in 2011 his goal was to eat meat only if he’d killed it himself.) The CEO is also spending more time meeting with diplomats and beginning to figure out how to invest 99 percent of his personal fortune—about $2 billion in cash and other assets, plus $52 billion in Facebook stock—in philanthropic causes With all that in mind, it’s fair to wonder whether Zuckerberg wants to run for public office He isn’t saying, but his online mix of serious 457 business and dad jokes can’t help but feel a little political For a point of comparison, check out Barack Obama’s social media accounts sometime Questions for Discussion What is the impact of good communication between Zuckerberg, his employees, and the nearly billion Facebook users? How does ineffective communication in an organization hamper innovation? Describe some of Zuckerberg’s nonverbal communication—what does it say to Facebook users? Facebook employees? 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