Chapter 6 Notes v2.docx

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University of Fraser Valley
Business Administration
BUS 100
Kim Milnes

Chapter 6 – Managing the Business Enterprise The Management Process 1) Management = process of planning, organizing, leading, controlling businesses’ resources to achieve goals a) 1 – all parts of the job interrelated b) Efficiency (most out w/ set input) vs. Effectiveness (achieving set goals) 2) Planning a) Process of determining firm’s goals and developing strategy to achieve them  1 – goals established  2 – manager IDs if gap is present between reality and goal  3 – managers develop plans to achieve these goals  4 – plans implemented  5 – effectiveness of the plan assessed b) Some managers use prediction markets to assess future possibilities  Employees buy “shares” in various answers to an important question(s) that needs answer c) Hierarchy of Plans  Three levels of plans: (1) Strategic plans = reflect decisions about resource allocation, company priorities, steps needed (2) Tactical plans = short-range concerned with implanting specific aspects of strategic plan (3) Operational Plans = short-term targets for daily/weekly/monthly performance 3) Organizing a) Portion of a manager’s job concerned with mobilizing the necessary resources to complete a particular task  Most businesses have organizational charts to outline jobs and how they relate 4) Leading a) Portion of a manager’s job concerned with guiding and motivating employees to meet the firm’s objectives b) Must have ability to motivate employees to set challenging goals and to work hard c) Authority to give orders  ability to guide employees  power to motivate subordinates 5) Controlling a) Portion of manager’s job concerned with monitor the firm’s performance and, if necessary, acting to bring it in line with the firm’s goals.  Establish standards  Measure performance  Does it meet standards  (Y: continue; N: adjust performance or standards Types of Managers 1) Levels of Management a) Top Managers (least)  Responsible for firm’s overall performance and effectiveness, and for developing long-range plans for the company  Responsible to Board of Directors and Stockholders  Ex. President, VP, CEO, CFO, COO b) Middle Managers  Responsible for implementing decisions made by the top managers  Ex. Plant Manager, Operations Managers, etc. c) First-line Managers (most)  Managers responsible for supervising the work of employees  Ex. Supervisor, office manager, group leader  Ensure proper training in all policies/procedures 2) Areas of Management a) Human Resource Managers (HRM)  Responsible for hiring/training/evaluating/compensating employees  Depending on size of company, may be broken down for each role b) Operations Managers  Responsible for company’s system for creating foods and services (inc. production control, inventory control, quality control c) Information Managers  Responsible for designing and implementing systems to gather, process and disburse information  More recent role as we’ve enter the Age of Information d) Marketing Managers  Responsible for developing, ricing, promoting, and distributing goods/services to buyers  Especially important for major competing firms (Coke vs. Pepsi)…these have many marketing managers e) Financial Managers  Responsible for planning and overseeing the financial resources of a firm f) Other Managers  Depending on company, some include R/D Manager, PR Managers, etc. 3) What does a Manager do? a) Mintszbeg’s Management Roles b) Managers work at an unrelenting pace activities are brief, varied, and fragmented c) Interpersonal roles  figurehead, leader, liaison d) Informational Roles  Monitor, disseminator, spokesperson e) Decisional Roles entrepreneur resources, disturbance handler, allocator, negotiator Basic Management Skills 1) Technical Skills a) Skills associated with performing specialized tasks within a firm b) Secretary = typing, Animator = cartooning c) These skills most impt. For first-line managers, decreasing up the line 2) Human Relation Skills a) Skills in understanding and getting along with people (lead, motivate, communicate) b) Vital skill, as poor actions lead to lower morale c) Top managers need to understand what the front line workers do (pressures, etc.) 3) Conceptual Skills a) Ability to think in the abstract, diagnose and analyze various situations and see beyond the present situation b) Helps managers recognize new market opportunities, etc. 4) Time Management Skills a) Skills associated with the productive use of time b) For top CEO’s, wasted time very expensive to stockholders (10k/hour+)  Paperwork – managers must sort quickly, and recognize what needs more attention  Telephone – screen calls to stop interruptions, and have specific telephone time  Meetings – clear agendas need to be set, and keep to schedule  Email – too many messages to sort through 5) Decision-Making Skills a) Skills in defining problems and suggesting the best courses of action b) Rational decision making process  Recognizing and defining the decision situation (1) Stimulus (positive or negative) indicates decision necessary  Identifying Alternatives (1) Obvious and creative alternatives considered (2) More impt. Decision = more alternatives  Evaluating Alternatives (1) Each evaluated to determines feasibility, satisfactoriness, consequences  Selecting the best alternative (1) Considering all situational factors, choose al
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