当代商学概论 当代商学概论 Fundamentals of BusinessFundamentals of Business

Lecture 6: Lecture 6:

Management: An Management: An OverviewOverview

What to cover todayWhat to cover today ：：

1.1. Management functionsManagement functions

2.2. Management levels and skillsManagement levels and skills

3.3. Organizational structure Organizational structure

4.4. Organizational decision-makingOrganizational decision-making

5.5. Strategic planning and SWOT Strategic planning and SWOT analysisanalysis

6.6. Organizational culture Organizational culture

ExercisesExercises

1. Management functions1. Management functions

PlanningPlanning: setting goals (i.e. ends) and fix: setting goals (i.e. ends) and fixing strategies (i.e. means)ing strategies (i.e. means)

OrganizingOrganizing: defining and group tasking, : defining and group tasking, allocating staff and resources, and strucallocating staff and resources, and structuring turing chain of command chain of command 指令链指令链

LeadingLeading: guiding and motivating; prope: guiding and motivating; proper leadership style r leadership style

ControllingControlling: info-gathering, performanc: info-gathering, performance assessing, and deviation correctinge assessing, and deviation correcting

2. Management levels and 2. Management levels and skillsskills

Top managers: Top managers: board of directorsboard of directors: executives from inside (also : executives from inside (also

managers) and outside (not managers) of a managers) and outside (not managers) of a company, elected by shareholders to act as their company, elected by shareholders to act as their representatives, oversee the company’s overall representatives, oversee the company’s overall business dealings, can appoint, oversee, reward business dealings, can appoint, oversee, reward and fire the CEOand fire the CEO

president/CEO/GMpresident/CEO/GM: ultimately responsible for : ultimately responsible for the company’s success or failure, oversees the the company’s success or failure, oversees the operations of the company, ensures its capital is operations of the company, ensures its capital is used to create the most profit, creates a used to create the most profit, creates a hierarchy of managershierarchy of managers

vice presidents/senior managersvice presidents/senior managers: report to : report to the president/CEO/GM, head up the company’s the president/CEO/GM, head up the company’s major functions, establish business goals and major functions, establish business goals and decide the models to achieve those goals, decide the models to achieve those goals, monitor the actions of middle managersmonitor the actions of middle managers

Sources of outside board membersSources of outside board members

Middle managers:Middle managers: function or division managersfunction or division managers: e.g. plant ma: e.g. plant ma

nager, sales manager, accounting manager; in nager, sales manager, accounting manager; in charge of the company’s various functions or charge of the company’s various functions or divisions, responsible for implementation of gdivisions, responsible for implementation of goals and policies, make daily decisions, monitoals and policies, make daily decisions, monitor bottom managersor bottom managers

Bottom-line/first-line managers:Bottom-line/first-line managers: supervisorssupervisors: e.g. head nurse in the emergency : e.g. head nurse in the emergency

room of a hospital, chief mechanic in the serviroom of a hospital, chief mechanic in the service department of a car dealership; responsible ce department of a car dealership; responsible for the daily supervision of nonmanagerial emfor the daily supervision of nonmanagerial employees, fulfill operational and supervisory dutployees, fulfill operational and supervisory dutiesies

Sources of managersSources of managers

from within the company: promotionfrom within the company: promotion from educational institutions: through jofrom educational institutions: through jo

b fairs or campus recruitment; b fairs or campus recruitment; managermanager/management trainee (MT) /management trainee (MT) 管理培训生管理培训生

from other organizations: directly or thrfrom other organizations: directly or through headhuntersough headhunters

Three types of managerial skills: Three types of managerial skills: Conceptual/analytical skills Conceptual/analytical skills 概括技能概括技能Human/interpersonal skills Human/interpersonal skills 人际技能人际技能 : :

the most importantthe most importantTechnical skills Technical skills 操作技能操作技能

3. Organizational 3. Organizational structurestructure

Organizational structure Organizational structure 组织结构组织结构 identifies reidentifies responsibilities for each job position and the relsponsibilities for each job position and the relationships among these positions. ationships among these positions.

3.1 Factors affecting the choice of organizatio3.1 Factors affecting the choice of organizational structuresnal structures

The specific organizational structure used by a fiThe specific organizational structure used by a firm may depend on:rm may depend on:

span of controlspan of control organizational heightorganizational height use of line vs. staff positionsuse of line vs. staff positions

Span of control Span of control 控制跨度控制跨度 : the number of employ: the number of employees managed by each manager, ideally fiveees managed by each manager, ideally five

Narrow span of controlNarrow span of control: an organizational stru: an organizational structure is designed so that each manager superviscture is designed so that each manager supervises just a few employees -- suitable for firms that es just a few employees -- suitable for firms that have highly diverse tasks have highly diverse tasks (Can you think of any e(Can you think of any examples?)xamples?)

Wide span of controlWide span of control: each manager supervises : each manager supervises numerous employees -- suitable for firms that nnumerous employees -- suitable for firms that numerous employees perform similar tasks umerous employees perform similar tasks (Can (Can you think of any examples?)you think of any examples?)

Examples of narrow and wide span of Examples of narrow and wide span of controlcontrol

President

Sales-person 1

Sales-person 2

Sales-person 3

Sales-Person 4

Sales-Person 5

President

Vice-Presidentof Operations

SalesManager

Sales-person

Organizational height Organizational height 组织结构高度组织结构高度 : the numb: the number of layers from the bottom of the structure to er of layers from the bottom of the structure to the topthe top

Tall organizational structureTall organizational structure: much distance : much distance between the bottom and the top, e.g. GM’s 10 between the bottom and the top, e.g. GM’s 10 levels – levels – narrower span of control narrower span of control

Short/flat organizational structureShort/flat organizational structure: not muc: not much distance from the bottom to the top, e.g. Toyh distance from the bottom to the top, e.g. Toyota’s 5 levels – ota’s 5 levels – wider span of controlwider span of control

In the 1990s and early 2000s, many firms, e.g. In the 1990s and early 2000s, many firms, e.g. Continental Airlines, IBM, GM, Sears, have atteContinental Airlines, IBM, GM, Sears, have attempted to cut expenses by eliminating job positmpted to cut expenses by eliminating job positions. This so-called ions. This so-called downsizing downsizing 裁员裁员 has resulhas resulted in flatter organizational structure with fewted in flatter organizational structure with fewer layers of management. er layers of management.

Effect of downsizing on span of control Effect of downsizing on span of control

Line vs. staff positions Line vs. staff positions 直线 直线 vs. vs. 参谋职位参谋职位 : two t: two types of job positionsypes of job positions

Line positionsLine positions: job positions established to ma: job positions established to make decisions that achieve specific business goalke decisions that achieve specific business goals; an organizational structure that contains onls; an organizational structure that contains only line positions and no staff positions is referrey line positions and no staff positions is referred to as a d to as a line organization line organization 直线组织直线组织

Staff positionsStaff positions: job positions established to su: job positions established to support the efforts of line positions; can be outsopport the efforts of line positions; can be outsourced; an organizational structure that containurced; an organizational structure that contains both line and staff positions is referred to as s both line and staff positions is referred to as a a line-and-staff organization line-and-staff organization 直线和职能混合直线和职能混合组织组织

3.2 Job specialization and departmentalization3.2 Job specialization and departmentalization

3.2.1 Job specialization 3.2.1 Job specialization 工作专业化工作专业化-- breaking down a firm’s overall tasks, responsibilities an-- breaking down a firm’s overall tasks, responsibilities an

d resources into small and specific parts or positionsd resources into small and specific parts or positions

3.2.2 Departmentalization 3.2.2 Departmentalization 部门化部门化-- grouping (mainly line) job positions into various departm-- grouping (mainly line) job positions into various departm

ents in a logical wayents in a logical way by functionby function by productby product by location by location by customerby customer by manufacturing processby manufacturing processAll these All these line departmentsline departments can work together with can work together with staff destaff de

partmentspartments to form line-and-staff organizations. to form line-and-staff organizations.

Functional organization

Divisional organization

Functional organization

Divisional organizationDivisional organization

3.3 Matrix organization3.3 Matrix organization-- an organizational structure that enables various parts -- an organizational structure that enables various parts

of the firm to interact to focus on specific projects, an of the firm to interact to focus on specific projects, an example of example of cross-functional teams cross-functional teams 跨功能团队跨功能团队

Members of a project team may continue to perform tMembers of a project team may continue to perform their normal tasks, and still report to the same boss for heir normal tasks, and still report to the same boss for those tasks, leading to the generation of “two-boss ethose tasks, leading to the generation of “two-boss employees”.mployees”.

3.4 Committee organization3.4 Committee organization-- an organizational structure that uses groups of people -- an organizational structure that uses groups of people

from different functions or divisions to make decisions from different functions or divisions to make decisions togethertogether

3.5 Informal organizational structure3.5 Informal organizational structure-- an informal communication network among a firm’s -- an informal communication network among a firm’s

employees, also called employees, also called grapevine grapevine 小道消息小道消息

Case studyCase study: Sony’ New : Sony’ New ““Networked” OrganizationNetworked” Organization

Questions: Questions:

1.1. What was the method used by Sony beforWhat was the method used by Sony before 2001 to departmentalize the firm?e 2001 to departmentalize the firm?

2.2. What were the pros and cons of such a mWhat were the pros and cons of such a method? ethod?

4. Organizational decision-4. Organizational decision-makingmaking

Given the complex patterns of Given the complex patterns of organizational structure, firms should organizational structure, firms should work out effective ways to work out effective ways to allocate allocate authorityauthority (i.e. the right to make (i.e. the right to make decisions) in the organization and decisions) in the organization and coordinatecoordinate their various functions their various functions and divisions.and divisions.

4.1 Chain of command4.1 Chain of command The hierarchy of authority is a company’s The hierarchy of authority is a company’s chacha

in of command in of command 指令链指令链 – – the relative authority the relative authority that each manager has – from the CEO down ththat each manager has – from the CEO down through the middle managers and first-line manrough the middle managers and first-line managers. agers.

The flatter the structure, the faster to make deThe flatter the structure, the faster to make decisions and the easier to coordinate departmecisions and the easier to coordinate departments. nts.

The unity of command principleThe unity of command principle: the principl: the principle that a subordinate should have one and only e that a subordinate should have one and only superior to avoid conflicting commandssuperior to avoid conflicting commands

The minimum chain-of-command principleThe minimum chain-of-command principle: : the principle that a company’s structure shouthe principle that a company’s structure should be designed with as few managerial levels as ld be designed with as few managerial levels as possiblepossible

4.2 Centralization vs. decentralization4.2 Centralization vs. decentralization Centralization Centralization 权力集中权力集中 : the way of distributing authority : the way of distributing authority

that most authority is held by the high-level managers; midthat most authority is held by the high-level managers; middle and first-line managers are responsible for day-to-day tdle and first-line managers are responsible for day-to-day tasks and for reporting to the top managers without making asks and for reporting to the top managers without making many decisions; most common in small and owner-operatemany decisions; most common in small and owner-operated businessesd businesses

Decentralization Decentralization 权力下放权力下放 : the way of distributing authori: the way of distributing authority that authority is spread among various levels of managety that authority is spread among various levels of management; ment; autonomy autonomy 自主权自主权 : an extreme form of decentralizati: an extreme form of decentralization, divisions are permitted to make their own decisions and on, divisions are permitted to make their own decisions and act independentlyact independently

Advantages: Advantages: Shorten the decision-making processShorten the decision-making process Improve the morale of employeesImprove the morale of employees Train employees for future high-level management positionTrain employees for future high-level management position

ssDisadvantages: Disadvantages: For employees to make major decisions while inexperienceFor employees to make major decisions while inexperience

dd Excessive workloadExcessive workload

4.3 Integrating mechanisms4.3 Integrating mechanisms

-- organizing tools that managers use to -- organizing tools that managers use to increase communication and increase communication and coordination among a company’s coordination among a company’s functions and divisionsfunctions and divisions

The greater the need for coordination, The greater the need for coordination, the more complex the integrating the more complex the integrating mechanisms tend to be.mechanisms tend to be.

Examples of cross-functional teams: Examples of cross-functional teams: matrix organization, project teams, matrix organization, project teams, committeescommittees

Four kinds of integrating mechanismsFour kinds of integrating mechanisms

Direct contacte.g. marketing manager and R&D manager meet to brain-storm new product ideas

Liaison rolese.g. assistant manager and project team leader identify best product suggestions to put into development

Task forcese.g. representatives from marketing, R&D and manufactu-ring meet to discuss launch of a new product

Cross-functional teame.g. a cross-functional team composed of all functions is formed to manage product to its launch in the market

simple

complex

5. Strategic planning and 5. Strategic planning and SWOT analysisSWOT analysis

Strategic management processStrategic management process: : mission and strategic goals – SWOT mission and strategic goals – SWOT analysis – developing, implementing analysis – developing, implementing and evaluating new strategies and evaluating new strategies

SWOT analysisSWOT analysis: a strategic planning : a strategic planning technique that matches the technique that matches the environment (external opportunities environment (external opportunities and threats) and the firm’s status quo and threats) and the firm’s status quo (internal strengths and weaknesses); (internal strengths and weaknesses); applicable to both new and existing applicable to both new and existing ventures; helps direct a firm’s future ventures; helps direct a firm’s future business strategiesbusiness strategies

Sample 1: Sample 1: 中国邮政快递业务中国邮政快递业务

Sample 2: ASIL, Inc.Sample 2: ASIL, Inc.

6. Organizational culture6. Organizational culture

-- the set of shared company values and norms t-- the set of shared company values and norms that shape the way employees and groups interhat shape the way employees and groups interact with one another, also called act with one another, also called corporate cucorporate culture lture 企业文化企业文化

e.g. working hard, respecting traditions and aute.g. working hard, respecting traditions and authority, being courteous to others, being consehority, being courteous to others, being conservative, being cautious, being creative, couragrvative, being cautious, being creative, courageous and taking risks, being honest, frugal and eous and taking risks, being honest, frugal and maintaining high personal standards, being a tmaintaining high personal standards, being a team player, keeping one’s desk tidy, cleanineam player, keeping one’s desk tidy, cleaning up at the end of the day, taking one’s turn tg up at the end of the day, taking one’s turn to bring doughnuts to the office, saying hi to evo bring doughnuts to the office, saying hi to everyone in the morning, wearing blue jeans and eryone in the morning, wearing blue jeans and T-shirts on a FridayT-shirts on a Friday

Sources of a company’s culture:Sources of a company’s culture:1.1. Values of the founderValues of the founder: Founders tend to recruit : Founders tend to recruit

mangers who share their values and who, in turn, mangers who share their values and who, in turn, recruit employees who share theirs, and gradually recruit employees who share theirs, and gradually the founder’s values and norms permeate the the founder’s values and norms permeate the entire firm. e.g. Bill Gates’ informal mode of dress entire firm. e.g. Bill Gates’ informal mode of dress and “think-outside-of-the-box” approachand “think-outside-of-the-box” approach

2.2. Organizational socializationOrganizational socialization: socialization : socialization programs to help new recruits “learn the ropes”programs to help new recruits “learn the ropes”

3.3. Ceremonies and ritesCeremonies and rites: formal events that : formal events that recognize employees or groups who have acted in recognize employees or groups who have acted in ways that benefit the company, e.g. rite of ways that benefit the company, e.g. rite of passage (recruitment, retirement, resignation), of passage (recruitment, retirement, resignation), of integration (office parties, company cookouts, integration (office parties, company cookouts, announcement meetings), and of enhancement announcement meetings), and of enhancement (promotions, awards dinners, press conference)(promotions, awards dinners, press conference)

4.4. Stories and languageStories and language: stories about heroic staff : stories about heroic staff members, Wal-Mart’s classic story about its much-members, Wal-Mart’s classic story about its much-valued employee Sheila, who risked her own valued employee Sheila, who risked her own safety to jump in front of a car to prevent a safety to jump in front of a car to prevent a customer from being struck customer from being struck

ExerciseExercises s

1. Translation 1. Translation (1) (1) 指令链 指令链 (2) (2) 自主权自主权(3) (3) 士气 士气 (4) (4) 裁员裁员(5)(5) 直线组织 直线组织 (6)(6) 跨功能团队 跨功能团队 (7) (7) 一线经理 一线经理 (8)(8) 权力下放权力下放(9) (9) 小道消息 小道消息 (10)(10) 企业文化企业文化

2. 2. Visit the website of a well-known company, anVisit the website of a well-known company, and draw a chart of its organizational structure; if d draw a chart of its organizational structure; if possible, explain the motives of adopting such possible, explain the motives of adopting such a structurea structure

3. Group project:3. Group project: conduct a SWOT analconduct a SWOT analysis of the new business proposed in thysis of the new business proposed in the marketing plan your group has just ae marketing plan your group has just accomplishedccomplished

4. Supplementary reading4. Supplementary reading

(1)(1) Methods of Departmentalizing TasksMethods of Departmentalizing Tasks(2)(2) Sony’ New “Networked” OrganizatiSony’ New “Networked” Organizati

onon(3)(3) How Michael Dell Created a Frugal CoHow Michael Dell Created a Frugal Co

mpany Culture?mpany Culture?