MGTA03 CHAPTER 7.docx

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MGTA03 CHAPTER 7 11/24/2011 8:18:00 AM
THE MANAGEMENT PROCESS:
Management: the process of planning, organizing, leading, and
controlling a business’s financial, physical, human, and information
resources in order to achieve its goals
Planning: that portion of a manager’s job concerned with determining what
the business needs to do and the best way to achieve it
Has three main components: determining the firm’s goals;
developing a comprehensive strategy to achieve those goals;
designing tactical and operational plans for implementing the
strategy
Planning process has 5 basic steps:
1. Goals are established for the organization
2. Managers identify whether a gap exists between the
company’s desire and actual position
3. Managers develop plans to achieve the desired objectives
(objectives indicate what results are desired, while plans indicate
how these objectives are to be achieved)
4. The plans that have been decided upon are implemented
5. The effectiveness of the plan is assessed (this requires
comparing actual results with planned performance)
E.g. Creation of Yahoo!: strategic goal of becoming top firm;
assessed ways in which people use the web, ways in which they
would use it in the future, analyzed successful strategies of other
growing firms; concluded that people wanted an easy-to-
understand web interface
Organizing: that portion of a manager’s job concerned with mobilizing the
necessary resources to complete a particular task
HP lost a lot of it’s lustre because of its poorly organized structure;
internet plan was not centralized
Leading: that portion of a manager’s job concerned with guiding and
motivating employees to meet the firm’s objectives
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Successful managers motivate employees to go above and beyond
normal work practices to ensure the company’s (and their own)
financial success
Controlling: that portion of a manager’s job concerned with monitoring the
firm’s performance and, if necessary, acting to bring it in line with the firm’s
goals
Control can be used to show where performance is running better
than expected and, thus, can serve as a basis for providing rewards
or reducing costs
LEVELS OF MANAGEMENT
Senior managers: those managers responsible for a firm’s overall
performance and effectiveness and for developing long-range plans for the
company least in number
Guide the fortunes of most companies
President, Vice-President, CFO, CEO, Treasurer
Responsible to the Board of Directors and shareholders of the firm
for its overall performance and effectiveness
Set general policies, formulate strategies, oversee all significant
decisions, and represent the company in its dealings with other
businesses and government
Middle managers: those managers responsible for implementing the
strategies, policies, and decisions made by top managers easiest to fire
Plant manager, operations manager, division manager
E.g. if top management decides to bring out a new product in 12
months, middle management will have to decide to increase the
pace of new product development
When cutting costs, jobs of middle managers are easy pick
First-line managers: those managers responsible for supervising the work
of employees greatest in number
Supervisor, office manager, group leader
Also interact extensively with externals
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