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Chapter 6

Ch.6 Managing the business enterprise - (SESSION 12-13. Jan.11,18)

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Department
Rotman Commerce
Course
RSM100Y1
Professor
John Oesch
Semester
Winter

Description
CH.6 – MANAGING THE BUSINESS ENTERPRISE Corporate Culture: the shared experiences, values, norms, and ethical stance that characterize an org. -managers can use that knowledge to be more effective in leading and motivating employees. WHO ARE MANAGERS?  All perform the same basic fxn's, are responsible for many of the same tasks, and have many of the same responsibilites. All plan, organize, direct, and cotrol day-to-day operations  Management Process o Management = process of planning, organizing, leading, and controlling (interrelated) an enterprise's financial, physical, human, and info resources to achieve the organization's goals of supplying various products /services o Distinction b/w management efficiency and management effectiveness  Efficiency: achieving the greatest level of output w/ a given amt. of input  Effectiveness: achieving the organizational goals that have been set o PLANNING  Planning: process of determining the firm's goals and developing a strategy for achieving them  Step 1: set up goals (indicate what results are desired) for the org.  Step 2: managers identify whether a gap exists b/w the company's desire and actual position  Step 3: managers develop plans (indicate how goals will are to be achieved) to achieve desired goal.  Step 4: plans that have been decided upon are implemented  Step 5: effectiveness of plan is assessed.  Prediction markets: helps managers assess future possibilities.--> creating a market where ppl can buy "shares" in variouis answers to important ?'s that need to be answered.  A hierarchy of plans: plans can be made on 3 gral levels; each level reflecting plans for which managers at that level are responsible. It's a hierarcyb/c implementing plans is practical only when there's a logical flow from 1 level to the next  Strategic plans: set by top managemetn; reflect decisions about resource allocations, company priorities, and the steps needed to meet strategic goals  Ex. GE's plan to be #1 or #2 in all the markets in which it competes in  Tactical plans: shorter-range plans concerned w/ implementing specific aspects of the company's strategic plans. They typically involve upper and middle management  Ex. Cocacola's plan to increase sales in Europe by building European bottling facilities  Operational plans: plans developed by middle and lower-level managers that set ST targets for daily, weekly, or monthly performance  Ex. McDonald's when it stipulates how Bic Macs are to be cooked, warmed, and served o ORGANIZING: mobilizing resources that are required to complete a particular task o LEADING  Leading (or directing): involves the interactions b/w managers and their subordinates as they both work to meet the firm's objectives  Leaders go beyond only giving orders… they attempt to guide and motivate employees to work in the best interests of the organization.o CONTROLLING  Controlling: process of monitoring a firm's performance to make sure that it is meeting its goals  Control can also show where oergormance is better than expected and thus serve as a basis for providing rewards or reducing costs o TYPES OF MANAGERS  What do managers do? --> work at unrelenting pace; their activieties are characterized by brevity, variety, and fragmentation; have a preference for "live" action and emphasize ork act. Athat're current, specific, and well defined; are attracted to the verbal media  Levels of Management  Top Manager: those managers responsible to the board of directors and shareholders for a firm's overal performance and effectiveness and for developing long-range plans for the company --> common titles: CEO, COO, CFO  Middle Manager: those managers responsible for implementing the decisions made by top managers --> ex. Plant manager, operations manager, division manager  First-line manager: those responsible for supervising the work of employees --> transit supervisor mointors bus schedules, passenger safety, etc.. Supervisor, office manager, group leades o AREAS OF MANAGEMENT  In any large company, the 3 types of managers work in a variety of areas :  Human resource managers: provide assistance to other managers when the're hiring employees, training them, evaluating their performance, and determining their compensation level. In unionized companies they're also involved in negotiating w/ the union  Operations Managers: responsible for the production systems that create goods/services --> production control, inventory control, and quality control, among others  Information mangers: responsible for designing and implementing systems that gater, process, and disseminate info  Marketing managers: responsible for getting products and services to buyers. Large companies will have three distinct levels of managers for this division  Financial managers: plans and oversee a companies financial resources. This also 3 distinct levels of managers for this division. o BASIC MANAGEMENT SKILLS  Technical skills: skills associated w/ performing specialized tasks w/in a company. Especially important for 1st line managers. They spend considerable amt of time helping employees solve work-related problems, monitoring their performance, and training them in > efficient work procedures.  Human relations skills: skills that enable managers to understand and get along w/ ppl.  Significantly > important for middle managers since they bridge b/w top managers, first-line managers and managers form other areas of the organization  Conceptual skills: person's ability to think tin the abstact, to diagnose and analyze diff. situation, and see beyond the present situation. Top managers depend most on their conceptual skills which help them recognize new market opportunties/ threats  Time management skills: the productive use that managers make of their time.  4 leading causes of wasting time:  Paperwork  Telephone  Meetings  Email  Decision making Skills: skills in defining problems and selecting the best courses of action.  Decision making: choosing one alternative from among several options  Managers can improve their decision making skills byfollowing a rational decision-making process  Step 1: Recognizing and Defining the Decision Situation  Problem decision: a decision that's necessary when actual results don't conform to those expected  Opportunity decision: taking new initiatives or doing a current activity > effectily even if no problem exists  Step 2: identifying alternatives  Factors such as legal restrictions, moral and ethical norms, and available technology can limit alternatives  Step 3: evaluating alternatives  Step 4: selecting the best alternative  Step 5: Implementing the chosen alternative  Managers must deal w/ employee resistance to change since this produces insecurity, inconvenience, and fear of the unknown. They must also recognize that the unanticipated consequences are still
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