Chapter 07 Management and Leadership McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc All rights reserved Chapter Seven LEARNING GOALS Describe the changes occurring today in the management function Describe the four functions of management Relate the planning process and decision making to the accomplishment of company goals 7-2 Chapter Seven LEARNING GOALS Describe the organizing function of management Explain the differences between leaders and managers, and describe the various leadership styles Summarize the five steps of the control function of management 7-3 Profile JOHN MACKEY Whole Foods Market • Worked at a vegetarian coop after attending the University of Texas • Opened SaferWay Natural Foods with his girlfriend before merging with a competitor to create Whole Foods • Now there are over 300 stores in the U.S. and U.K. 7-4 Chapter Seven NAME that COMPANY Like many companies today, this company uses social media to communicate with customers. In one case, a customer complained on Twitter when the company sent a Blackberry to replace an iPhone that failed. The company responded quickly with a replacement iPhone. The customer then tweeted about the company’s great customer service Name that company! 7-5 Four Functions of Management LG1 WHAT IS MANAGEMENT? • Management The process used to accomplish organizational goals through planning, organizing, leading and controlling people and other organizational resources 7-6 Managers’ Roles Are Evolving TODAY’S MANAGERS LG1 • Younger and more progressive - Growing numbers of women - Fewer from elite universities • Emphasis is on teams and team building • Managers need to be skilled communicators and team players. 7-7 Managers’ Roles Are Evolving RESPECT and HOW to GET IT LG1 30% 25% 20% 15% 10% 5% 0% 7-8 Managers’ Roles Are Evolving LG1 EDUCATION MATTERS Examples of Alma Maters of CEOs Rank US School # of CEOs Who? Harvard College, MA 31 Bill Gates – Microsoft (Did Not Graduate) Cornell University, NY Carl Bass - Autodesk; Mark T Bertolini - Aetna University of Pennsylvania 11 Louis D'Ambrosio - Sears Holdings Corp Massachusetts Institute of Technology 11 Drew Houston - Dropbox Northwestern University, IL 11 Lisa Caputo - Citigroup Stanford University, CA 11 Steve Ballmer - Microsoft Yale University, CT 10 William Howard Taf – US President; James McNerney - Boeing Columbia University, NY Theodore Roosevelt - US President; Ursula Burns - Xerox Princeton University, NJ Andrea Jung - Avon Products 10 Southern Methodist University, TX C David Crush – Virgin America 7-9 Four Functions of Management LG2 FOUR FUNCTIONS of MANAGEMENT Planning Organizing Leading Controlling 7-10 Staffing: Getting and Keeping the Right People LG4 STAFFING is TRICKY BUSINESS Six Sins of Staffing Don’t hire someone because someone else says so Don’t get caught up in applicants’ appearances Don’t give someone the wrong job Don’t forget about feedback Don’t give promotions just because it’s time Don’t cheat your employees 7-35 Leading: Providing Continuous Vision and Values LEADERSHIP LG5 Leaders must: • Communicate a vision and rally others around that vision • Establish corporate values • Promote corporate ethics • Embrace change • Stress accountability and responsibility 7-36 To SHARE or NOT to SHARE (Making Ethical Decisions) As a firstline manager, you have new information your department head has not seen yet. The findings of the report indicate your manager’s plans should fail. If they do fail, you could be promoted Will you give your department head the report? What is the ethical thing to do? What might be the consequences? 7-37 Leading: Providing Continuous Vision and Values LG5 ACCOUNTABILITY through TRANSPARENCY Transparency The presentation of the company’s facts and figures in a way that is clear and apparent to all allowing you to be accountable. 7-38 Leadership Styles LG5 LEADERSHIP STYLES Autocratic Leadership Making managerial decisions without consulting others Participative or Democratic Leadership Managers and employees work together to make decisions FreeRein Leadership Managers set objectives and employees are free to do whatever is appropriate to accomplish those objectives 7-39 Leadership Styles VARIOUS LEADERSHIP STYLES LG5 7-40 Leadership Styles NATURAL BORN LEADERS? Four Types of Executives LG5 Rationalists Humanists Politicists Culturists Source: CIO Magazine, www.cio.com 7-41 USING SOCIAL MEDIA to BUILD CUSTOMER SUPPORT (Social Media in Business) Many companies use sites like Twitter and Facebook to proactively and reactively communicate with their customers Best Buy has 2,500 employees who read and respond to consumer complaints on Twitter Many companies still are not implementing these programs. This has led to many more complaints via social media than positive support 7-42 Empowering Workers EMPOWERMENT LG5 Progressive leaders give employees the authority to make decisions on their own without consulting a manager Customer needs are handled quickly Manager’s role becomes less of a boss and more of a coach Enabling Giving workers the education and tools they need to make decisions 7-43 Empowering Workers LG5 WORK SMARTER How to Ease Pressure on Workers Manage output instead of hours Train workers to be ready for a more complex corporate structure Allow lowerlevel managers to make decisions Use new technology to foster teamwork Shift hiring emphasis to collaboration. Source: Bloomberg BusinessWeek, www.businessweek.com 7-44 Managing Knowledge MANAGING KNOWLEDGE LG5 • Knowledge Management Finding the right information, keeping the information in a readily accessible place and making the information known to everyone in the firm • Tries to keep people from reinventing the wheel 7-45 Controlling: Making Sure it Works FIVE STEPS of CONTROLLING LG6 Establish Clear Standards Monitor & Record Performance Compare Results Against Standards Communica te Results If Needed, Take Corrective Action Are Standards Realistic? 7-46 Controlling: Making Sure it Works ARE YOU a MICROMANAGER? LG6 • Do you have strategic initiatives that you have not addressed? • Do you often check on employees for quality control? • Do you often check on subordinates throughout the day? • Do you rarely take vacations? • Is there a lot of turnover? Source: CFO Magazine, www.cfo.com 7-47 A Key Criterion for Measurement: Customer Satisfaction MEASURING SUCCESS LG6 • Traditional forms of measuring success are financial • Pleasing employees, stakeholders and customers is important • External Customers Dealers, who buy products to sell to others, and ultimate customers (or end users), who buy products for their own use • Internal Customers Individuals and units within the firm that receive services from other individuals or units 7-48 Progress Assessment PROGRESS ASSESSMENT • How does enabling help achieve empowerment? • What are the five steps in the control process? • What’s the difference between internal and external customers? 7-49 ... What are some of the changes happening in management today? • What’s the definition of management used in this chapter? • What are the four functions of management? 7- 11 Planning & Decision Making SHARING the VISION... SUPERVISORY (FIRST-LINE) MANAGEMENT Supervisors, Foremen Department Heads Section Leaders NON-SUPERVISORY Employees 7- 27 Organizing: Creating a Unified System MANAGEMENT LEVELS LG4 Top Management The highest level, consists of the ... University, TX C David Crush – Virgin America 7- 9 Four Functions of Management LG2 FOUR FUNCTIONS of MANAGEMENT Planning Organizing Leading Controlling 7- 10 Progress Assessment PROGRESS ASSESSMENT