BUSINESS MANAGEMENT
Duong Cong Doanh, Assoc. Prof. PhD
LOGO
Some important concepts
Business
A business is any activity that
seeks to provide goods and
services to others while
operating at a profit.
Goods are tangible products
such as computers, food,
clothing, cars, and appliances.
Services
Services are intangible
products such as education,
health care, insurance,
recreation, travel and tourism.
Entrepreneur
Goods
An entrepreneur is a person
who risks time and money to
start and manage a business
BUSINESS?
NEU, FTU
TRANSENCO
Sidewalk Iced Tea
→ Operated by an organization → business enterprises
CONTENTS
1
Introduction to management
2
Planning
3
Organizing
4
Leading
5
Controlling
PART 1. Introduction to management
▪ Explain why managers are
important to organizations
▪ Tell who managers are and where
they work
▪ Describe the functions, roles, and
skills of managers
▪ Describe the factors that are
reshaping and redefining the
manager’s job
▪ Explain the value of studying
management
PART 1. Introduction to management
Are you ready to be a manager?
Infographic Style
Insert the title of your subtitle Here
EXERCISE
Materialize a business idea
PART 1. Introduction to management
Why are managers important
1.1
✓ Organizations need their managerial skills and
abilities in certain, complex and chaotic times.
✓ Managers are critical to getting things done in
organization.
✓ Managers contribute to employees' productivity and
loyalty; the way employees are managed can affect
the organization’s financial performance; and
managerial ability has been shown to be important in
creating organizational value.
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
✓ A manager is someone who coordinates and
oversees the work of other people so that
organizational goals can be accomplished.
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
Levels of
management
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
✓ Top managers: executive vice president, president,
managing director, chief operating officer or chief
executive officer.
✓ Middle managers: regional manager, project leader,
store manager or division manager.
✓ First-line managers: supervisor, shift manager,
district manager, department manager or office
manager.
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
General manager
Reception
department
Room
department
Marketing
department
Restaurant
department
Recreational
department
Administrative
department
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
✓ Managers work in an organization, which is a
deliberate arrangement of people to accomplish
some specific purpose.
✓ Organizations have three characteristics: a
distinctive purpose, composed of people and a
deliberate structure.
PART 1. Introduction to management
Who are managers and
Where do they work?
1.2
Deliberate
structure
Distinct
purpose
People
Characteristics
of Organizations
PART 1. Introduction to management
What do managers do?
1.3
✓ Management involves coordinating and overseeing
the work activities of others so that their activities are
completed efficiently and effectively.
❖ EFFICIENCY: doing the things right
❖ EFFECTIVENESS: doing the right things
PART 1. Introduction to management
What do managers do?
1.3
Management functions
Planning
Organizing
Leading
Controlling
Setting goals,
establishing
strategies
and
developing
plans to
coordinate
activities
Determining
what needs to
be done, how
it will be
done, and
who is to do it
Motivating,
leading, and
any other
actions
involved in
dealing with
people
Monitoring
activities to
ensure that
Achieving the
they are
organization's
accomplished stated purposes
as planned
PART 1. Introduction to management
What do managers do?
1.3
Managerial roles
✓ Interpersonal roles: involve people and other duties
that are ceremonial and symbolic in nature
✓ Informational roles: involve collecting, receiving
and disseminating information
✓ Decisional roles: entail making decisions or choices
PART 1. Introduction to management
What do managers do?
1.3
Mintzberg's
managerial
roles
PART 1. Introduction to management
What do managers do?
1.3
Management skills
✓ Conceptual
Skills
–
cognitive ability to see the
organization as a whole
system
✓ Human Skills – the ability to
work with and through other
people
✓ Technical Skills – the
understanding and proficiency
in the performance of specific
tasks
Skills in
Management
PART 1. Introduction to management
What do managers do?
1.3
PART 1. Introduction to management
How is the manager's job changing?
1.4
✓ The changes impacting managers’ jobs include
global economic and political uncertainties changing
workplaces, ethical issues, security threats, and
changing technology:
❖ Concerned with customer service
❖ Concerned with innovation
❖ Concerned with subtainability
PART 1. Introduction to management
Why study management?
1.5
✓ The universality of management, which refers to
the fact that managers are needed in all types and
sizes of organizations, at all organizational levels and
work areas, and in all global locations
✓ The reality of work – that is, you will either manage
or be managed
✓ The awareness of the significant rewards and
challenges in being a manager
PART 2. PLANNING
2.1. Managers as decision makers
2.2. Foundations of planning
2.3. Strategic management
PART 2. PLANNING
Managers as decision makers
2.1
▪ Describe the eight steps in the
decision-making process
▪ Explain the four ways managers
make decisions
▪ Classify decisions and decisionmaking conditions
▪ Describe
different
decisionmaking styles and discuss how
blases affect decision making
▪ Identify effective decision-making
techniques.
PART 2. PLANNING
The decision-making process
Identifying a problem
Identifying decision criteria
Allocating weights to the criteria
Developing alternatives
Analyzing alternatives
Selecting an alternative
Implementing the alternative
Evaluating decision effectiveness
2.1.1
PART 2. PLANNING
The decision-making process
1. Identifying a problem
→My sale reps need new computers
2. Identifying decision criteria
3. Allocating weights to the criteria
Memory and storage
10
Battery life
8
Carrying weight
6
Warranty
4
Display quality
3
2.1.1
PART 2. PLANNING
The decision-making process
2.1.1
4. Developing alternatives
Memory and
Storage
Battery
life
Carrying
weight
Warranty
Display
Quality
HP Probook
10
3
10
8
5
Sony VAIO
8
7
7
8
7
Lenovo IdeaPad
8
5
7
10
10
Apple Macbook
8
7
7
8
7
Toshiba Satellite
7
8
7
8
7
Sony NW
8
3
6
10
8
Dell inspiron
10
7
8
6
7
HP Pavilion
4
10
4
8
10
PART 2. PLANNING
The decision-making process
2.1.1
5. Analyzing alternatives
Memory and
Storage
HP Probook
Sony VAIO
Lenovo IdeaPad
Apple Macbook
Toshiba Satellite
Sony NW
Dell inspiron
HP Pavilion
Battery
life
Carrying
weight
Warranty
Display
Quality
PART 2. PLANNING
The decision-making process
6. Selecting an alternatives
→Choose the Dell Inspiron
7. Implementing the alternative
8. Evaluating decision effectiveness
2.1.1
PART 2. PLANNING
Managers making decisions
2.1.2
✓ Rationality: decribes choices that are logical and
consistent and maximize value
✓ Bounded rationality: decision making that’s
rational, but limited (bounded) by an individual’s
ability to process information
✓ The role of intuition: making decisions on the basis
of experience, feelings, and accumulated judgment
✓ The role of evidence-based management: the
systematic use of the best available evidence to
imporve management practice
PART 2. PLANNING
Types of decisions and
decision-making conditions
2.1.3
Types of decisions
✓ Structured problems and programmed decisions
are repetitive decisions that can be handled by a routine
approach and are used when the problem being resolved is
straightforward, familiar and easily defined (structured).
✓ Unstructured
problems
and
nonprogrammed
decisions
are unique decisions that require a custom-made solution
and are used when the problems are new or unusual
(unstructured) and for which information is ambiguous or
incomplete.
PART 2. PLANNING
Types of decisions and
decision-making conditions
Types of decisions
2.1.3
PART 2. PLANNING
Types of decisions and
decision-making conditions
2.1.3
Decision-making conditions
✓ Certainly: is a situation in which a manager can
make accurate decisions because all outcomes
are known.
✓ Risk: is a situation in which a manager can
estimate the likelihood of certain outcomes
✓ Uncertainly: is a situation in which a manager is
not certain about the outcomes and can't even
make reasonalbe probability estimates.
PART 2. PLANNING
Types of decisions and
decision-making conditions
2.1.3
Decision-making conditions
✓ When decision makers face uncertainly, their
psychological orientation will determine
whether they follow:
❖ A maximax choice (maximizing the maximum
posible payoff)
❖ A maximin choice (maximizing the minimum
possible payoff)
❖ A minimax choice (minimizing the maximum
regret)
❖ Hurwicz…
PART 2. PLANNING
- Maximin choice
MaxMinaij
i
- Minimax choice
j
Min Max bij
i
j
bij = Max aij − aij
i
PART 2. PLANNING
- Maximax choice
MaxMax aij
i
j
- Hurwicz choice
aij + (1 −  ) Min aij
hi =   Max
j
Maxh i
i
j
PART 2. PLANNING
NHU CẦU GIẢM
NHU CẦU TĂNG
Tình huống
Cạnh tranh
tăng (Y1)
Cạnh tranh
giảm (Y2)
Cạnh tranh
tăng (Y3)
Cạnh tranh
giảm (Y4)
Giữ nguyên sp cũ (X1)
10
45
40
60
Khác biệt hóa sp (X2)
20
50
55
75
Sản xuất sp mới (X3)
35
15
45
80
Quyết định
Decisional matrix
TÌNH HUỐNG
A = (aij )
Y1
Y2
Y3
Y4
X1
10
45
40
60
X2
20
50
55
75
X3
35
15
45
80
PHƯƠNG ÁN
Reget matrix
TÌNH HUỐNG
B = (bij )
Y1
Y2
Y3
Y4
X1
25
5
15
20
X2
15
0
0
5
X3
0
35
10
0
PHƯƠNG ÁN
Decisional matrix
TÌNH HUỐNG
QUYẾT ĐỊNH
Y1
…………...
Yj
………...
Yn
X1
a11
…………….
a1 j
………….
a1n
.
.
.
.
.
.
……………..
.
.
.
…………..
.
.
.
ai1
……………..
…………..
ain
.
.
.
……………..
.
.
.
…………..
.
.
.
Xi
.
.
.
aij
Xm
am1
……………..
amj
…………..
amn
Xác suất
P1
……………..
Pj
…………..
Pn
PART 2. PLANNING o
- Max EMV
EMV ( X i ) = P1  ai1 + P2  ai 2
Max EMV ( X i )
i
+  + Pn  ain
- Min EOL
bij = Max aij − aij
i
EOL ( X i ) = P1  bi1 + P2  bi 2 +  + Pn  bin
Min EOL( X i )
i
Example
NHU CẦU GIẢM
NHU CẦU TĂNG
Tình huống
Cạnh tranh
tăng (Y1)
Cạnh tranh
giảm (Y2)
Cạnh tranh
tăng (Y3)
Cạnh tranh
giảm (Y4)
Giữ nguyên sp cũ (X1)
10
45
40
60
Khác biệt hóa sp (X2)
20
50
55
75
Sản xuất sp mới (X3)
35
15
45
80
Xác suất (P)
0,2
0,1
0,5
0,2
Quyết định
Inventory Models
Quantity Discounts for the EOQ Model
Quantity Discounts
Inventory Model with Planned
Shortages
Shortages (Stockout)-Backorder
Economic Production Lot Size Model
Total Cost Model- Economic Production Lot Size
Economic Order
Quantity (EOQ) Model
The How-Much-to-Order
Decision, The When-to-Order
Decision
INVENTORY
MODELS
In applications involving inventory,
managers must answer two important
questions:
1. How much should be ordered
when the inventory is replenished?
2. When should the inventory be
replenished?
Ch = IC
I = annual holding cost rate
C= unit cost of the inventory item
Ch = annual cost of holding one unit in inventory
INVENTORY MODELS
Q: The order quantity
D: The annual demand
for the product
C0 : The cost of placing
one order
Finance Infographic
INVENTORY MODELS
The How-Much-to-Order-Decision.
The Economic Order Quantity (EOQ) formula
The How-Much-toOrder-Decision
INVENTORY
MODELS
The when-to-order decision is expressed in
terms of a reorder point-the inventory position
at which a new order should be placed.
R = DM
R= Reorder point
D= Demand per day
M = Lead time for a new order in days
Cycle Time
This general expression for cycle time is based on 250
working days per year. If the firm operated 300 working
days per year and wanted to express cycle time in terms of
working days, the cycle time would be given by:
T = 300Q*/D.
SELT
TEST
1
Exercise 01
Suppose that the R&B Beverage Company has a soft drink product
that shows a constant annual demand rate of 3600 cases. A case of
the soft drink costs R&B $3. Ordering costs are $20 per order and
holding costs are 25% of the value of the inventory. R&B has 250
working days per year, and the lead time is 5 days. Identify the
following aspects of the inventory policy:
a. Economic order quantity
b. Reorder point
c. Cycle time
d. Total annual cost
SELT
TEST
1
Exercise 2
Westside Auto purchases a component used in the manufacture of automobile
generators directly from the supplier. Westside’s generator production
operation, which is operated at a constant rate, will require 1000 components
per month throughout the year (12,000 units annually). Assume that the
ordering costs are $25 per order, the unit cost is $2.50 per component, and
annual holding costs are 20% of the value of the inventory. Westside has 250
working days per year and a lead time of 5 days. Answer the following
inventory policy questions:
1. What is the EOQ for this component?
2. What is the reorder point?
3. What is the cycle time?
4. What are the total annual holding and ordering costs associated with your
recommended EOQ?
ECONOMIC PRODUCTION LOT SIZE MODEL
The lot size is the number of units
in an order
TOTAL COST MODEL
At this point, the logic of the production lot size model is easier to follow using a daily demand rate d and
a daily production rate p. However, when the total annual cost model is eventually developed, inputs to
the model be expressed in terms of the annual demand rate D and the annual production rate P.
ECONOMIC
PRODUCTION
LOT SIZE
MODEL
ECONOMIC PRODUCTION LOT SIZE
As the production rate P approaches infinity, D/P approaches zero.
TOTAL COST MODEL

Equations (1) and (2) are equivalent. However, equation (1)
may be used more frequently because an annual cost model
tends to make the analyst think in terms of collecting annual
demand data (D) and annual production data (P) rather than
daily data.
ECONOMIC
PRODUCTION
LOT SIZE
INVENTORY MODEL WITH PLANNED SHORTAGES
Total annual cost (TC) for the inventory model
Order quantity (Q)
Planned Backorder (S)
Q U A N T I T Y
DISCOUNTS FOR THE
E O Q
M O D E L
Quantity discounts occur in numerous
situations in which suppliers provide an incentive for
large order quantities by offering a lower purchase cost
when items are order in larger quantities
SELT
TEST
1
Exercise 3
SELT
TEST
1
Exercise 4
Tele-Reco is a new specialty store that sells
television sets, videotape recorders, video games,
and other television-related products. A new
Japanese-manufactured videotape recorder costs
Tele-Reco $600 per unit. Tele-Reco’s annual holding
cost rate is 22%. Ordering costs are estimated to be
$70 per order.
a. If demand for the new videotape recorder is
expected to be constant with a rate of 20 units per
month, what is the recommended order quantity for
the videotape recorder?
b. What are the estimated annual inventory holding
and ordering costs associated with this product?
c. How many orders will be placed per year?
d. With 250 working days per year, what is the cycle
time for this product?
Self-Test
Exercise 11
Exercise 12
A large distributor of oil-well drilling
equipment operated over the past two
years with EOQ policies based on an
annual holding cost rate of 22%. Under
the EOQ policy, a particular product has
been ordered with a Q* = 80. A recent
evaluation of holding costs
shows that because of an increase in the
interest rate associated with bank loans,
the annual holding cost rate should be
27%.
a. What is the new economic order
quantity for the product?
b. Develop a general expression
showing how the economic order
quantity changes
when the annual holding cost rate is
changed from I to I’.
All-Star Bat Manufacturing, Inc., supplies
baseball bats to major and minor league
baseball teams. After an initial order in
January, demand over the six-month
baseball season is approximately
constant at 1000 bats per month.
Assuming that the bat production
process
can handle up to 4000 bats per month,
the bat production setup costs are $150
per setup, the production cost is $10 per
bat, and the holding costs have a
monthly rate of 2%, what production lot
size would you recommend to meet the
demand during the baseball season?
If All-Star operates 20 days per month,
how often will the production process
operate, and what is the length of a
production run?
SELT
TEST
1
Exercise 5
Nation-Wide Bus Lines is proud of its six-week bus driver training program that
it conducts for all new Nation-Wide drivers. As long as the class size remains
less than or equal to 35, a six-week training program costs Nation-Wide
$22,000 for instructors, equipment, and so on. The Nation-Wide training
program must provide the company with approximately five new drivers per
month. After completing the training program, new drivers are paid $1600 per
month but do not work until a full-time driver position is open. NationWide
views the $1600 per month paid to each idle new driver as a holding cost
necessary
to maintain a supply of newly trained drivers available for immediate service.
Viewing new drivers as inventory-type units, how large should the training
classes be to minimize Nation-Wide’s total annual training and new driver idletime costs? How many training classes should the company hold each year?
What is the total annual cost associated with your recommendation?
SELT
TEST
1
Exercise 6
Cress Electronic Products manufactures components used in the automotive
industry. Cress purchases parts for use in its manufacturing operation from a
variety of different suppliers. One particular supplier provides a part where the
assumptions of the EOQ model are realistic. The annual demand is 5000 units,
the ordering cost is $80 per order, and the annual holding cost rate is 25%.
a. If the cost of the part is $20 per unit, what is the economic order quantity?
b. Assume 250 days of operation per year. If the lead time for an order is 12
days, what is the reorder point?
c. If the lead time for the part is seven weeks (35 days), what is the reorder
point?
d. What is the reorder point for part (c) if the reorder point is expressed in
terms of the inventory on hand rather than the inventory position?
Self-Test
Exercise 15
Exercise 16
Assume that you are reviewing the
production lot size decision
associated with a production
operation where P = 8000 units
per year, D = 2000 units per year,
C0 = $300, and Ch = $1.60 per unit
per year. Also assume that current
practice calls for production runs
of 500 units every three months.
Would you recommend changing
the current production
lot size? Why or why not? How
much could be saved by
converting to your production lot
size recommendation?
Suppose that Westside Auto of
Problem 4, with D = 12,000 units
per year, Ch = (2.50)(0.20) =
$0.50, and C0 = $25, decided to
operate with a backorder inventory
policy. Backorder costs are
estimated to be $5 per unit per
year. Identify the following:
a. Minimum cost order quantity
b. Maximum number of backorders
c. Maximum inventory
d. Cycle time
e. Total annual cost
SELT
TEST
1
Exercise 7
Wilson Publishing Company produces books for the retail market. Demand for
a current book is expected to occur at a constant annual rate of 7200 copies.
The cost of one copy of the book is $14.50. The holding cost is based on an
18% annual rate, and production setup costs are $150 per setup. The
equipment on which the book is produced has an annual production volume of
25,000 copies. Wilson has 250 working days per year, and the lead time for a
production run is 15 days. Use the production lot size model to compute the
following values:
a. Minimum cost production lot size
b. Number of production runs per year
c. Cycle time
d. Length of a production run
e. Maximum inventory
f. Total annual cost
g. Reorder point
SELT
TEST
1
Exercise 8
A manager of an inventory system believes that inventory models are important
decision-making aids. Even though often using an EOQ policy, the manager
never considered a backorder model because of the assumption that
backorders were “bad” and should be avoided. However, with upper
management’s continued pressure for cost reduction, you have been asked to
analyze the economics of a backorder policy for some products that can
possibly be backordered. For a specific product with D = 800 units per year,
Co= $150, Ch= $3, and Cb = $20, what is the difference in total annual cost
between the EOQ model and the planned shortage or backorder model? If the
manager adds constraints that no more than 25% of the units can be
backordered and that no customer will have to wait more than 15 days for an
order, should the backorder inventory policy be adopted? Assume 250 working
days per year.
SELT
TEST
1
Exercise 9
The A&M Hobby Shop carries a line of radio-controlled model racing cars.
Demand for the cars is assumed to be constant at a rate of 40 cars per month.
The cars cost $60 each, and ordering costs are approximately $15 per order,
regardless of the order size. The annual holding cost rate is 20%.
a. Determine the economic order quantity and total annual cost under the
assumption that no backorders are permitted.
b. Using a $45 per-unit per-year backorder cost, determine the minimum cost
inventory policy and total annual cost for the model racing cars.
c. What is the maximum number of days a customer would have to wait for a
backorder under the policy in part (b)? Assume that the Hobby Shop is open
for business 300 days per year.
d. Would you recommend a no-backorder or a backorder inventory policy for
this product? Explain.
e. If the lead time is six days, what is the reorder point for both the nobackorder and backorder inventory policies?
SELT
TEST
1
Exercise 10
SELT
TEST
1
Exercise 11
SELT
TEST
1
Exercise 12
SELT
TEST
1
Exercise 13
SELT
TEST
1
Exercise 14
SELT
TEST
1
Exercise 15
A perishable dairy product is ordered daily at a particular supermarket.
The product, which costs $1.19 per unit, sells for $1.65 per unit. If units
are unsold at the end of the day, the supplier takes them back at a
rebate of $1 per unit. Assume that daily demand is approximately
normally distributed with µ= 150 and σ = 30.
a. What is your recommended daily order quantity for the supermarket?
b. What is the probability that the supermarket will sell all the units it
orders?
c. In problems such as these, why would the supplier offer a rebate as
high as $1? For example, why not offer a nominal rebate of, say, 25¢
per unit? What happens to the supermarket order quantity as the
rebate is reduced?
PART 2. PLANNING
Decision-making styles
2.1.4
Linear-Nonlinear thinking style profile
✓ Linear thinking style: preference for using
external data and facts and processing this
information through rational logical thinking.
✓ Nonlinear thinking style: preference for internal
sources of information and processing this
information with internal insights, feelings and
hunches.
PART 2. PLANNING
Decision-making styles
2.1.4
Decision-making biases and errors
✓ Use ‘rules of thumb’ or heuristics
Rules of thumb that manager use to simplify decision
making.
PART 2. PLANNING
Decision-making styles
2.1.4
Decision-making biases and errors
Common
Decisionmaking biases
PART 2. PLANNING
Decision-making styles
2.1.4
PART 2. PLANNING
Effective decision making in today's world
2.1.5
An effective decision-making process
✓ Focuses on what's important
✓ Is logical and consistent
✓ Acknowledge both subjective and objective
thinking and blends both analytical and intuitive
appoaches
✓ Requires only ‘enough’ information as is
necessary to resolve a proplem
✓ Encourages and guides gathering relevant
information and informed opinions
✓ Is straghtforward, reliable, easy to use, and
flexible
PART 2. PLANNING
Effective decision making in today's world
2.1.5
The five habits of highly reliable organization are
✓ Not being tricked by their successes
✓ Defering to experts on the front line
✓ Letting unexpected circumstances provide the
solution
✓ Embracing complexity
✓ Anticipating but also recognizing, limits
PART 2. PLANNING
2.1. Managers as decision makers
2.2. Foundations of planning
2.3. Strategic management
PART 2. PLANNING
Foundations of planning
2.2
▪ Define the nature and purposes of
planning
▪ Classify the types of goals
organizations might have and the
plans they use
▪ Compare
and
contrast
approaches to goal setting and
planning
▪ Discuss contemporary issues in
planning
PART 2. PLANNING
The what and why of planning
2.2.1
✓ Planning involves defining the organization's
goals, establishing strategies for achieving those
goals and developing plans to integrate and
coordinate work activities.
PART 2. PLANNING
The what and why of planning
✓
▪
▪
▪
2.2.1
Why do managers plan?
Provide direction
Reduce uncertainly
Minimizes
waste
and
redundancy
▪ Establishes the goal or
standards used in controlling
PART 2. PLANNING
The what and why of planning
2.2.1
✓ Planning and performance?
❖ Formal planning is associated with positive
financial results.
❖ Doing a good job planning and implementing the
plans than doing more extensive planning.
❖ The external environment is usually the reason
why companies that plan don’t achieve high levels
of performance.
❖ The planning-performance relationship seems to
be influenced by the planning time frame.
PART 2. PLANNING
Goals and plans
2.2.2
✓ Goals (objective) are desired outcomes or
targets.
✓ Plans are documents that outline how goals are
going to be met
PART 2. PLANNING
Goals and plans
2.2.2
Types of goals
✓ Stated goals: official statements of what an
organization says, and what it wants its various
stakeholders to believe, its goals are.
✓ Real goals: goals that an organization actually
pursues, as defined by the actions of its
members.
PART 2. PLANNING
Goals and plans
2.2.2
Types of plans
✓ Strategic plans: plans that apply to the entire
organization and establish the organization's
overall goals
✓ Operational plans: plans that encompass a
particular operational area of the organization
PART 2. PLANNING
Goals and plans
2.2.2
Types of plans
✓ Long-term plans: plans with a time frame
beyond three years
✓ Short-term plans: plans covering one year or
less
PART 2. PLANNING
Goals and plans
2.2.2
Types of plans
✓ Specific plans: plans that are clearly defined and
leave no room for interpretation
✓ Directional plans: plans that are flexible and set
out general guidelines
PART 2. PLANNING
Goals and plans
2.2.2
Types of plans
✓ Single-use plans: a one-time plan specifically
designed to meet the needs of a unique situation
✓ Standing plans: ongoing plans that provide
guidance for activities performed repeatedly
PART 2. PLANNING
Goals and plans
Types of plans
2.2.2
PART 2. PLANNING
Setting goals and developing plans
2.2.3
Setting goals
✓ In traditional goal setting, goals are set at the
top of the organization and then become subgoals
for each organizational area.
✓ Management by objectives (MBO), a process of
setting mutually agreed-upon goals and using
those goals to evaluate employee performance
PART 2. PLANNING
Setting goals and developing plans
2.2.3
Setting goals
The downside
of traditional
goal setting
PART 2. PLANNING
Setting goals and developing plans
2.2.3
Setting goals
Well-written
goals
PART 2. PLANNING
PART 2. PLANNING
• Dongseo hotel is a large hotel located in
Hanoi.
• Dongseo hotel wishes to become one of the
big 5-star hotels serving domestic and
foreign customers.
Plan your department for the coming year?
PART 2. PLANNING
Setting goals and developing plans
2.2.3
Setting goals
Steps in goal setting
✓ Review the organization's
mission
✓ Evaluate available resources
✓ Determine
the
goals
individually or with input from
others
✓ Write down the goals and
communicate them to all who
need to know
✓ Review results and whether
goals are being met
PART 2. PLANNING
Setting goals and developing plans
2.2.3
Developing plans
✓ The contigency factors that affect planning include the
manager's level in the organization, the degree of
environmental uncertainly, and the length of future
commitments
✓ The two main approaches to planning:
❖ Traditional approach: plans developed by top managers that
flow down through other organizational levels and which may
use a formal planning department.
❖ The other approach: is to involve more organizational members
in the planning process.
PART 2. PLANNING
Contemporary issues in planning
2.2.4
✓ Planning in dynamic environments, which
usually means developing plans that are
specific but flexible
✓ Using environmental scanning to help do a
better analysis of the external environment
PART 2. PLANNING
2.1. Managers as decision makers
2.2. Foundations of planning
2.3. Strategic management
PART 2. PLANNING
Strategic management
2.3
▪ Define strategic management and
explain why it's important
▪ Explain what managers do during
the six steps of the strategic
management process
▪ Describe the three types of
corporate strategies
▪ Describe competitive advantage
and the competitive strategies
organizations use to get it
▪ Discuss
current
strategic
management issues
PART 2. PLANNING
Strategic management
2.3.1
What is strategic management?
✓ Strategic management is what managers do
to develop the organization's strategies.
✓ Strategies are the plans for how the
organization will do whatever it’s in business
to do, how it will compete successfully, and
how it will attract and satisfy its customers in
order to achieve its goals
✓ Business model is how a company is going
to make money
PART 2. PLANNING
Strategic management
2.3.1
Why is strategic management important?
✓ Strategic management is important for 3
reasons
❖ It makes a difference in how well
organizations perform
❖ Helping managers cope with continally
changing situations
❖ Helping coordinate and focus employee
efforts on what's important
PART 2. PLANNING
The strategic management process
2.3.2
PART 2. PLANNING
The strategic management process
2.3.2
✓ Step 1: Identfying the Organizaton’s Current
Mission, Goals, and Strategies
→ Mission: a statement of its purpose
PART 2. PLANNING
The strategic management process
2.3.2
✓ Step 2: Doing an external analysis
→ Opportunities: are positive trends in the
external environment.
→ Threat: are negative trends.
PART 2. PLANNING
The strategic management process
2.3.2
✓ Step 3: Doing an internal analysis
→ Strengths: are activities the organization
does well or any unique resources
→ Threat: are activities the organization doesn't
do well or resources it needs but doesn't
possess
The combined external and internal analyses are called
the SWOT analysis
PART 2. PLANNING
The strategic management process
2.3.2
✓ Step 4: Formulating strategies
→ Managers should consider the realities of
external environment and their available
resources and capabilities in order to design
strategies that will help an organization
achieve its goals.
→ Three main types of strategics managers will
formulate include: corporate, competitive and
functional.
PART 2. PLANNING
The strategic management process
2.3.2
✓ Step 5: Implementing strategies
✓ Step 6: Evaluating results
PART 2. PLANNING
Corporate strategies
What is corporate strategy?
2.3.3
PART 2. PLANNING
Corporate strategies
2.3.3
What is corporate strategy?
✓ Corporate strategy is an organizational
strategy that determines what business a
company is in or wants to be in and what it
wants to do with those businesses.
✓ It’s based on the mission and goals of the
organization and the roles that each
business unit of the organization will play
PART 2. PLANNING
Corporate strategies
2.3.3
What are the types of corporate strategy
✓ A growth strategy is when an organization
expands the number of markets served or
products offered, includes:
❖ Concentration
❖ Vertical integration
❖ Horizontal integration
❖ Diversiffication
PART 2. PLANNING
Corporate strategies
2.3.3
What are the types of corporate strategy
❖ Concentration focusses on its primary line
of business and increases the number of
products offered or markets served in this
primary businesses.
❖ Vertical integration – backward, forward:
➢ Backward: the organization becomes it own
supplier so it can control its inputs.
➢ Forward: the organization becomes its own
distributor and is able to control its outputs.
PART 2. PLANNING
Corporate strategies
2.3.3
What are the types of corporate strategy
❖ Horizontal intergration: a company grows
by combining with competitors.
❖ Diversification – related or unrelated
➢ Related diversification happens when a
company combines with other companies in
different, but related, industries.
➢ Unrelated diversification is when a company
combines with firms in different and
unrelated industries.
PART 2. PLANNING
Corporate strategies
2.3.3
How are corporate strategies managed?
✓ Using a tool called a corporate portfolio
matrix - this matrix provides a framework for
understanding diverse businesses and help
managers establish priorities for allocating
resources.
❖ BCG matrix
❖ SWOT matrix
PART 2. PLANNING
Corporate strategies
2.3.3
How are corporate strategies managed?
SWOT ANALYSIS
PART 2. PLANNING
Competitive strategies
2.3.4
The role of competitive strategies
✓ An organization's competitive advantage
is what sets it apart, its distinctive edge becomes the basis for choosing an
appropriate competitive strategy.
❖ Quality as a competitive advantage
❖ Sustaining competitive advantage
PART 2. PLANNING
Competitive strategies
2.3.4
The role of competitive strategies
✓ Five forces model
❖ Threat of new entrants: how likely is it that new
competitors will come into the industry?
❖ Threat of substitutes: how likely is it that other
industries’ products can be substituted for our
industry’s products?
❖ Bargaining power of buyers: how much bargaining
power do buyers have?
❖ Bargaining power of suppliers: how much
bargaining power do suppliers have?
❖ Current rivalry: how intense is the rivalry among
current industry competitors?
PART 2. PLANNING
Competitive strategies
The role of competitive strategies
2.3.4
PART 2. PLANNING
Competitive strategies
Choosing a competitive strategy
✓ Cost leadership strategy: competing
on the basis of having the lowest costs
in the industry
✓ Differentiation: competing on the
basis of having unique products that
are widely valued by customers
✓ Focus: competing in a narrow
segment with either a cost advantage
or a differentiation advantage
2.3.4
PART 2. PLANNING
Funtional strategies
The funtional strategies
✓ are the strategies used by an
organization's
various
funtional
departments to support the competitive
strategy.
2.3.4
PART 2. PLANNING
Current strategic management issues
Strategic leadership
✓ is the ability to anticipate, envision,
maintain flexibility, think strategically
and
valuable
future
for
the
organization.
2.3.5
PART 2. PLANNING
Current strategic management issues
Strategic flexibility
✓ is the ability to recognize when a
strategic decision isn't working is
important because managers often
face highly uncertain environments.
2.3.5
PART 2. PLANNING
Current strategic management issues
2.3.5
Important organizational strategies for
today's environment
✓ e-Business strategies: the clicks and bricks
strategy, which combines online and traditional
stand-alone locations.
✓ Customer service strategies: include giving
customers what they want, communicating
effectively with them, and having a culture that
emphasizes customer service.
✓ Innovation strategies: include deciding their
organization’s innovation emphasis and its
innovation timing.
PART 3. ORGANIZING
3.1. Basic organizational design
3.2. Managing human resources
3.3. Managing teams
PART 3. ORGANIZING
Basic organizational design
3.1
▪ Describe six key elements in
organizational design
▪ Contrast mechanistic and organic
structures
▪ Discuss the contingency factors
that favor either the mechanistic
model or the organic model of
organizational design
▪ Describe traditional organizational
designs
PART 3. ORGANIZING
Designing organizational structure
3.1.1
PART 3. ORGANIZING
Designing organizational structure
3.1.1
✓ The key elements in organizational
design are work specialization, chain
of command, span of control,
departmentalization,
centralizationdecentralization, and formalization.
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Work specialization
✓ Was viewed as a way to divide work activities into
separate job tasks.
✓ Makes efficient use of the diversity of skills that
workers have.
✓ Today’s view: most managers today continue to see
work specialization as important because it helps
employees be more efficient.
PART 3. ORGANIZING
Designing organizational structure
Work specialization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Departmentalization
✓ The basis by which jobs are grouped together
✓ Five common forms of departmentalization (Next
figure)
✓ Today’s view: most large organizations continue to
use combinations of most or all of these types of
departmentalization.
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Departmentalization
✓
❖
❖
❖
❖
❖
The various forms of departmentalization are as follows:
Functional departmentalization by functions performed
Geographical departmentalization by geographical region
Product departmentalization by product lines
Process departmentalization on product or customer flow
Customer departmentalization on specific and unique
customer groups
PART 3. ORGANIZING
Designing organizational structure
Departmentalization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
Departmentalization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
Departmentalization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Chain of command
✓ The line of authority extending from upper
organizational levels to the lowest levels, which
clarifies who reports to whom.
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Chain of command
✓Authority: the rights inherent in a managerial position
to tell people what to do and to expect them to do it.
❖ Line authority entitles a manager to direct the work of
an employee.
❖ Staff authority refers to functions that support, assist,
advice, and generally reduce some of managers’
informational burdens.
✓Responsibility: the obligation or expectation to
perform any assigned duties.
✓Unity of command: the management principle that
each person should report to only one manager.
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Span of control
✓ The number of employees a manager can efficiently
and effectively manage
✓ The traditional view of span of control was that
managers should directly supervise no more than
five to six individuals.
✓ The contemporary view is that the span of control
depends on the skills and abilities of manager and
the employees and on the characteristics of the
situation.
PART 3. ORGANIZING
Designing organizational structure
Span of control
3.1.1
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Centralization and decentralization
✓ Centralization: the degree to which decision
making is concentrated at upper levels of the
organization.
✓ Decentralization: the degree to which lower-level
employees provide input or actually make decisions
✓ Today’s view: managers often choose the amount of
centralization or decentralization that will allow them
to best implement their decisions and achieve
organizational goals.
PART 3. ORGANIZING
Designing organizational structure
Centralization and decentralization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
Centralization and decentralization
3.1.1
PART 3. ORGANIZING
Designing organizational structure
3.1.1
Formalization
✓ Formalization refers to how standardized an
organization's jobs are and the extent to which
employee behavior is guided by rules and
procedures.
✓ Formalization concerns the organization's use of
standardization and strict rules to provide
consistency and control
PART 3. ORGANIZING
Mechanistic and organic strutures
3.1.2
✓ A mechanistic organization is a rigid and tightly
controlled structure.
✓ An organic organization is highly adaptive and
flexible.
PART 3. ORGANIZING
Mechanistic and organic strutures
3.1.2
PART 3. ORGANIZING
Contingency factors affecting
structural choice
3.1.3
✓ Appropriate struture is depends on four
contingency variables:
❖ Strategy
❖ Size
❖ Technology
❖ Degree of environmental uncertainty
✓ Today's view: the evidence on the environmentstructure relationship helps explain why so many
managers
today
are
restructuring
their
organizations to be lean, fast and flexible.
PART 3. ORGANIZING
Traditional organizational designs
3.1.4
✓ A
simple
structure
is
one
with
low
departmentalization, wide spans of control, authority
centralized in a single person, and little
formalization.
✓ A funtional structure groups similar or related
occupational specialties together.
✓ A divisional structure is made up of separate
business units or divisions.
PART 3. ORGANIZING
Traditional organizational designs
3.1.4
PART 3. ORGANIZING
Divide tasks between members
in your department in Dongseo hotel
PART 3. ORGANIZING
3.1. Basic organizational design
3.2. Managing human resources
3.3. Managing teams
PART 3. ORGANIZING
Managing human resources
3.2
▪ Explain the importance of the human
resource management process and the
external influences that might affect that
process.
▪ Discuss the tasks associated with
identifying and selecting competent
employees.
▪ Explain the different types of orientation
and training.
▪ Describe
strategies
for
retaining
competent, high-performing employees.
▪ Discuss
contemporary
issues
in
managing human resources.
PART 3. ORGANIZING
The human resource management process
3.2.1
Why is HRM important?
✓ It can be a significant source of competitive
advantage as various studies have concluded.
✓ HRM is an important part of organizational
strategies.
✓ The way organizations treat their people has been
found to significantly impact organizational
performance
PART 3. ORGANIZING
The human resource management process
External factors that affect the HRM process
✓
✓
✓
✓
The economy’s effect
Employee labor
Legal environment
Demographic trends
3.2.1
PART 3. ORGANIZING
Identifying and selecting competent employees
3.2.2
Human resource planning
✓ HR planning is the process by which managers
ensure that they have the right number and kinds of
capable people in the right places and at the right
times.
PART 3. ORGANIZING
Identifying and selecting competent employees
3.2.2
Human resource planning
✓ Current assessment: managers begin HR planning by
inventorying current employees (includes information on
employees such as name, education, training, prior
employment, languages spoken, special capabilities and
specialized skills).
❖ Job analysis: an assessment that defines a job and the
behaviors necessary to perform it.
❖ Job description: is a written statement describing a job
typically job content, environment, and conditions of
employment.
❖ Job specification: states the minimum qualifications
that a person must possess to successfully perform a
given job.
PART 3. ORGANIZING
Identifying and selecting competent employees
3.2.2
Human resource planning
✓ Meeting future HR needs: are determined by the
organization’s mission, goals and strategies.
PART 3. ORGANIZING
Identifying and selecting competent employees
3.2.2
Recruitment and decruitment
✓ Recruitment: locating, identifying and attracting
capable applicants.
✓ Decruitment: reducing an organization’s workforce.
PART 3. ORGANIZING
Identifying and selecting competent employees
Recruitment and decruitment
Recruiting sources
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Recruitment and decruitment
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Selection
✓ Selection: screening job applicants to ensure that
the most appropriate candidateds are hired.
✓ A decision is correct when the applicant was
predicted to be successful and proved to be
successful on the job, or when the applicant was
predicted to be unsuccessful and was not hired.
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Selection
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Selection
✓ Validity and reliability:
❖ A valid selection device is characterized by a
proven relationship between the selection device
and some relevant criterion.
❖ A reliable selection device indicates that it
measures the same thing consistently.
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Selection
✓ Types of selection tools: the best-known
selection tools include application forms, written
and performance-simulation tests, interviews,
background investigations, and in some cases,
physical exams.
3.2.2
PART 3. ORGANIZING
Identifying and selecting competent employees
Selection
✓ Realistic job previews: a preview at a job that
provides both positive and negative information
about the job and the company.
3.2.2
PART 3. ORGANIZING
Providing employees with needed skills
and knowledge
Orientation
✓ Orientation: introducing a new employee to his or
her job and the organization.
❖ Work unit orientation familiarizes the employee
with the goals of the work unit, clarifies how his or
her job contributes to the unit’s goals, and includes
an introduction to his or her new coworkers.
❖ Organization orientation informs the new
employee about the company’s goals, history,
philosophy, procedures and rules.
3.2.3
PART 3. ORGANIZING
Providing employees with needed skills
and knowledge
3.2.3
Employee training
✓ Types
of
training
Type
Includes
General
Communication skills, computer systems
application and programming, customer
service, executive development,
management skills and development,
personal growth, sales, supervisory skills,
and technological skills and knowledge
Specific
Basic life/work skills, creativity, customer
education, diversity/cultural awareness,
remedial writing, managing change,
leadership, product knowledge, public
speaking/presentation skills, safety, ethics,
sexual harassment, team building, wellness,
and others
PART 3. ORGANIZING
Providing employees with needed skills
and knowledge
Orientation
✓ Training methods: although employee training
can be done in traditional ways, many
organizations are replying more on technologybased training methods because of their
accessibility, cost and ability to deliver information.
3.2.3
PART 3. ORGANIZING
Providing employees with needed skills
and knowledge
3.2.3
Orientation
✓ Training
methods
On the job
Employees learn how to do tasks simply by
performing them, usually after an initial
introduction to the task
Job rotation
Employees work at different jobs in a particular
area, getting exposure to a variety of tasks
Mentoring
Employees work with an experienced worker
and coaching who provides information, support and
encouragement; also called apprenticeships in
certain industries
Experiental
Employees participate in role playing,
exercises
simulation, or other face-to-face types of
training
Workbooks/
Employees refer to training workbooks and
manuals
manuals for information
Classroom
Employees attend lectures designed to convey
lecturers
specific information
PART 3. ORGANIZING
Providing employees with needed skills
and knowledge
3.2.3
Orientation
✓ Training methods
Technology-Based Training Methods
CD-Rom/DVD/videotapes/audiotapes/podcasts
Videoconferencing/teleconferencing/satellite TV
E-learning
Employees listen to or watch selected
media that convey information or
demostrate certain techniques
Employees listen to or practicipate as
information is conveyed or techniques
demonstrated
Internet-based learning where
employees participate in multimedia
simulations or other interactive
modules
PART 3. ORGANIZING
Retaining competent, high-perrming employees
3.2.4
Employee performance management
✓ Performance appraisal methods: establishes
performance standards that are used to evaluate
employee performance.
✓ It's particularly challenging when managers and
employees alike sense that they're not beneficial.
PART 3. ORGANIZING
Retaining competent, high-perrming employees
Employee performance management
3.2.4
PART 3. ORGANIZING
Retaining competent, high-perrming employees
3.2.4
Compensation and benefits
✓ Developing an effective and appropriate
compensation system is an important part of
the HRM process.
❖ It can help attract and retain competent and
talented individuals who help the organization
accomplish its mission and goals.
❖ It has an impact on its strategic performance.
PART 3. ORGANIZING
Retaining competent, high-perrming employees
Compensation and benefits
3.2.4
PART 3. ORGANIZING
Retaining competent, high-perrming employees
3.2.4
Compensation and benefits
✓ Skill-based pay system reward employees for the
job skills and competencies they can demonstrate.
In a variable pay system, an employee's
compensation is contingent on performance.
PART 3. ORGANIZING
Contemporary issues in managing human resources
3.2.5
Managing downsizing
✓ Downsizing (or layoffs) is the planned elimination
of jobs in an organization
✓ Managers
can
manage
downsizing
by
communicating openly and honestly, following
appropriate laws regarding severance pay or
benefits,
providing
support/counseling
for
surviving employees, reassigning roles according
to inviduals’ talents and backgrounds, focusing on
boosting morale, and having a plan for empty
office spaces.
PART 3. ORGANIZING
Contemporary issues in managing human resources
3.2.5
Managing sexual harassment
✓ Sexual harassment: any unwanted action or
activity of a sexual nature that explicitly or
implicitly affects an individual’s employment,
performance or work environment.
✓ Managers need to be aware of what constitutes
an offensive or hostile work environment, educate
employees on sexual harassment, and ensure
that no retaliatory actions are taken against any
person who files harassment charges. Also they
may need to have a policy in place for workplace
romances.
PART 3. ORGANIZING
Contemporary issues in managing human resources
3.2.5
Managing work-life balance
✓ Organizations are dealing with work-family life
balance issues by offering family-friendly benefits
such
as
on-site
child
care,
flextime,
telecommuting, and so on.
✓ Manager need to understand that people may
prefer programs that segment work and personal
lives, while others prefer programs that integrate
their work and personal lives.
PART 3. ORGANIZING
Contemporary issues in managing human resources
3.2.5
Controlling HR Costs
✓ Organizations are controlling HR costs by
controlling employee health care costs through
employee health initiatives (encouraging healthy
behavior and penalizing unhealthy behaviors) and
controlling employee pension plans by eliminating
or severely limiting them.
PART 3. ORGANIZING
Recruiting
staff
for the
department
PART 3. ORGANIZING
1. Each department chooses a job position that needs to
be recruited, then writes job analysis - job
description - job specification.
2. Choose any applicant in the class that matches these
criteria
3. Your head of department and head of
administrative department will take a number of
steps in the recruitment of new employee (paper test,
interview…)
PART 3. ORGANIZING
3.1. Basic organizational design
3.2. Managing human resources
3.3. Managing teams
PART 3. ORGANIZING
Managing teams
3.3
▪ Define groups
▪ Decribe the major components that
determine group performance and
satisfaction
▪ Define teams and best practices
influencing team performance
▪ Discuss
contemporary
issues
in
managing teams
PART 3. ORGANIZING
Groups
3.3.1
What is a group?
✓ A group is defined as two or more interacting and
interdependent individuals who come together to
achieve specific goals.
✓ Formal groups are work groups that are defined
by the organization’s structure and have
designated work assignments and specific tasks
directed at accomplishing organizational goals.
✓ Informal groups are social groups - occur
naturally in the workplace and tend to form around
friendships and common interests.
PART 3. ORGANIZING
Work group performance and satisfaction
3.3.2
External conditions imposed on the group
✓ External conditions, such as availability of
resources, organizational goals and strategies,
authority
relationships,
formal
rules
and
regulations, employee selection criteria,...
PART 3. ORGANIZING
Work group performance and satisfaction
3.3.2
Group member resources
✓ These resources include knowledge, abilities,
skills and personality traits and they determine
what members can do and how effectively they
will perform in a group.
PART 3. ORGANIZING
Work group performance and satisfaction
3.3.2
Group structure
✓ Group roles generally involve getting the work done
or keeping group member happy.
✓ Group norms are powerful influences on a person’s
performance and dictate things such as work output
levels, absenteeism and promptness.
✓ Pressures to conform can heavily influence a person’s
judgent and attitudes.
✓ Status systems can be a significant motivator with
individual behavioral consequences
✓ Size group is most effective and efficient depends on
the task the group is supposed to accomplish.
PART 3. ORGANIZING
Work group performance and satisfaction
3.3.2
Group structure
✓ Group processes are important to understanding
work groups because they influence group
performance and satisfaction positively or negatively.
✓ Group decision making and conflict management
are important group processes that play a role in
performance and satisfaction. If accuracy, creativity
and degree of acceptance are important, a group
decision may work best. Effective communication and
controlled conflict are most relevant to group
performance when tasks are complex and
interdependent.
PART 3. ORGANIZING
Work group performance and satisfaction
Group tasks
✓ Tasks are either simple or complex
❖ Simple tasks are routine and standardized.
❖ Complex tasks tend to be novel or nonroutine.
3.2.2
PART 3. ORGANIZING
Turning groups into effective teams
3.3.3
What is a work team?
✓ Work teams: groups whose members work intensely
on a specific, common goal using their positive energy,
individual
and
mutual
accountability,
and
complementary skills.
PART 3. ORGANIZING
Turning groups into effective teams
What is a work team?
3.3.3
PART 3. ORGANIZING
Turning groups into effective teams
3.3.3
Types of work teams
✓ Problem-solving team: a team from the same
department or funtional area that's involved in efforts
to improve work activites or to solve specific problems.
✓ Self-managed work team: a type of work team that
operates without a manager and is responsible for a
complete work process or segment.
✓ Cross-functional team: a work team composed of
individuals from various functional specialtles
✓ Virtual team: a type of work team that uses
technology to link physically dispersed members in
order to achieve a common goal.
PART 3. ORGANIZING
Turning groups into effective teams
Creating effective work teams
3.3.3
PART 3. ORGANIZING
Current challenges in managing teams
3.3.4
Managing global teams
✓ Group member resources in global teams:
understanding the relationship between group
performance and group member; recognizing team
members’ abilities, skills, knowledge, personality.
✓ Group structure: see differences in managing global
teams include conformity, status, social loafing and
cohesiveness.
✓ Group processes: communication issues and
managing conflict in global teams aren’t easy.
✓ Manager’s role: managers can provide the group with
an environment in which efficiency and effectiveness
are enhanced.
PART 3. ORGANIZING
Current challenges in managing teams
3.3.4
Building team skills
✓ Managers must view their role as more of being a
coach and developing team members in order to
create more commited, collaborative and inclusive
teams.
✓ Not everyone is a team player or can learn to be a
team player. If attempts at team building aren’t
working, then maybe it’s better to put those people in
positions where their work is done individualy.
PART 3. ORGANIZING
Current challenges in managing teams
3.3.4
Understanding social networks
✓ Social network structure: the patterns of informal
connections among individuals within a group.
✓ Managers need to understand the social networks and
social relationships of work groups.
Do you have skills for teamwork?
1. Suppose your group has a new member and your boss
calls on a volunteer to help him/her learn in the early
stages. You will:
✓ A. Help the person even before your boss asks you to
✓ B. Happy to help, but on the condition that your boss has to
offload some of the tasks for you
✓ C. Ignore your boss's email calls. You yourself have so
much to worry about that you can't worry about others
Do you have skills for teamwork?
2. Your boss scheduled a group meeting at 5pm but you
were planning to leave at that time to see the doctor. What
you will do?
✓ A. Cancel the appointment and make another appointment
with your doctor. You cannot make your boss angry
✓ B. Talk to your boss about the appointment but offer to cancel
it if the meeting is urgent
✓ C. Decline the meeting request and leave without telling your
boss. You don't have to explain because it is after work.
Do you have skills for teamwork?
3. You are working on a team project and a colleague is not
doing his part of his responsibilities. How would you
control the situation?
✓ A. Say nothing to the boss or other co-workers and quietly
finish the work of the other colleague. You feel unfair, but
you're afraid people will think you're petty
✓ B. Talk to the other colleague privately and repeat everyone's
work on the project
✓ C. Go straight to the boss room and report. The other person
deserves to be scolded by the boss for doing his part
incorrectly
Do you have skills for teamwork?
4. Your team has to stay working late for the past few days
to complete a project and is required to work one day late.
You will:
✓
A. Concerned about coworkers should suggest that they go
home. You will finish the rest of the work
✓ B. Stay knowing that sometimes work requires overtime.
When you're not busy, you can leave work on time
✓ C. Assign the job to the assistant and leave. Why do you
have to stay late when someone else does it for you?
Do you have skills for teamwork?
5. The whole team is discussing a new product marketing
strategy and a team member is saying unrealistic, unable to
attract customers. How will you react?
✓ A. You will tell him/ er that it's a great idea and take time to
analyze it more closely. You don't want to offend him/her even
though it might waste other people's time.
✓ B. You praise him/her for sharing ideas but encourage
him/her to think more about other options based on the
client's point of view.
✓ C. You strongly oppose that opinion and say that no
customers will be interested in such an advertising campaign.
Do you have skills for teamwork?
If most of your response is A: You seem to say “yes”
to everything from taking on other people's work to
agreeing with the team about something you don't really
believe in. It's a good thing to give in, but you can't let
your boss or coworker take advantage. Sometimes you
can disagree, say “no” when there is a good reason or
an alternative. People will respect you more if you dare
to stand up for your own opinion.
Do you have skills for teamwork?
If most of your answer is B: You are a perfect team
member. You know when "one for everyone" and when it
is appropriate to defend yourself. You are willing to help
others or stay late when you can still take control of your
work and not let others take advantage of it. You
encourage good ideas but also challenge others when
you know they can do or think better. Maintain the same
ability to work as a team.
Do you have skills for teamwork?
If most of your answers are C: Protecting your
interests first is a good thing but you tend to always do
so. Most jobs require employees to work together to
some degree, so you need to be willing to compromise
for the greater good of the team. Acting like that does
not mean giving up your opinions or beliefs. It's as
simple as getting your work done, you need to rely on
others and let them rely on you. If you don't, you will find
yourself gradually alienated by everyone in your group.
DISCOVER YOURSELF
✓ Take a piece of paper, divide it into four corners
✓ Each corner of the paper will display one of the following:
1. Your strengths
2. Your weaknesses
3. Things you love to do
4. Things you don't like to do
✓ Each of you will have 30 minutes to prepare, then present and
receive advice from me and an evaluation team.
PART 4. LEADING
4.1. Understanding individual behavior
4.2. Managers as leaders
PART 4. LEADING
Understanding individual behavior
4.1
▪ Identify the focus and goals of individual
behavior within organizations.
▪ Explain the role that attitudes play in job
performance.
▪ Describe personality
▪ Describe perception
PART 4. LEADING
Focus and goals of organizational behavior
4.1.1
Focus of organizational behavior
✓ Just like an iceberg, it’s the hidden organizational
elements (attitudes, perceptions, norms, etc.) that
make
understanding
individual
behavior
so
challenging.
✓ Behavior: the actions of people
✓ Organizational behavior (OB): the study of the
actions of people at work.
PART 4. LEADING
Focus and goals of organizational behavior
4.1.1
Goals of Organizational behavior
✓ OB focusses on three areas: individual behavior,
group behavior and organizational aspects.
✓ The goals of OB are to explain, predict and influence
behavior.
✓ Employee productivity is a performance measure of
both efficiency and effectiveness.
PART 4. LEADING
Focus and goals of organizational behavior
4.1.1
Goals of Organizational behavior
✓ Organizational citizenship behavior (OCB) is
discretionary behavior that’s not part of an employee’s
formal job requirements, but which promotes the
effective functioning of organization.
✓ Job satisfaction: an employee’s general attitude
toward his or her job.
✓ Workplace misbehavior: any intentional employee
behavior that is potentially damaging to the
organization or to individuals within the organization.
PART 4. LEADING
Attitudes and job performance
4.1.2
Attitudes
✓ Attitudes are evaluative statement, either favorable or
unfavorable, concerning objects, people or events.
✓ An attitude is made up of three components:
cognition, affect and behavior.
❖ The cognitive component refers to the beliefs,
opinions, knowledge, or information held by a person.
❖ The affective component is the emotional or feeling
part of an attitude.
❖ The behavioral component refers to an intention to
behave in a certain way toward someone or
something.
PART 4. LEADING
Attitudes and job performance
4.1.2
Job satisfaction
✓ Job satisfaction is an employee's general attitude
toward his or her job.
✓ Job satisfaction positively influences productivity,
lowers absenteeism levels, lower turnover rates,
promotes positive customer satisfaction, moderately
promotes OCB and helps minimize workplace
misbehavior.
PART 4. LEADING
Attitudes and job performance
4.1.2
Job involvement and organizational commitment
✓ Job involvement is the degree to which an employee
identifies with his or her job, actively participates in it,
and considers his or her job performance to be
important to his or her self-worth.
✓ Organizational commitment is the degree to which
an employee identifies with a particular organization
and its goals and wishes to maintain membership in
that organization.
PART 4. LEADING
Attitudes and job performance
4.1.2
Employee engagement
✓ Employee engagement is when employees are
connected to, satisfied with and enthusiatic about their
jobs.
PART 4. LEADING
Attitudes and job performance
4.1.2
Attitudes surveys
✓ Attitudes surveys present the employee with a set of
statements or questions eliciting how they feel about
their jobs, work groups, supervisors, or the
organization.
PART 4. LEADING
Attitudes and job performance
4.1.2
PART 4. LEADING
Attitudes and job performance
4.1.2
Implications for managers
✓ Managers should be interested in their employees's
attitudes because they influence behavior.
✓ Managers should focus on factors that have been
shown to be conducive to high levels of employee job
satisfaction: making work challenging and interesting,
providing equitable rewards, creating supportive
working conditions and encouraging supportive
colleagues.
✓ Managers should also survey employees about their
attitudes.
✓ Managers should show that employees will try to
reduce dissonance.
PART 4. LEADING
Personality
4.1.3
✓ Personality: the unique combination of emotional,
thought, and behavioral patterns that affect how a
person reacts to situations and interacts with others.
✓ Types of personality: Quiet, passive, loud,
aggressive, ambitious, extroverted, loyal, tense or
sociable,...
✓ Managers should understand personality to know
why an employee is uncomfortalbe with some
decision, to work effectively together,...
PART 4. LEADING
Perception
4.1.4
✓ Persception: a process by which we give meaning to
our environment by organizing and interpreting
sensory impressions.
✓ Managers need to recognize that their employees
react to perceptions, not ot reality.
PART 4. LEADING
4.1. Understanding individual behavior
4.2. Managers as leaders
PART 4. LEADING
Managers as leaders
4.2
▪ Define leader and leadership
▪ Describe leadership styles
▪ Compare and contrast leadership and
management
▪ Discuss leadership traits
▪ Describe power and influence
PART 4. LEADING
Who are leaders and what is leadership
4.2.1
✓ Leader: Someone who can influence others and who
has managerial authority.
✓ Leadership as defined here is the ability to influence
people toward the attainment of organizational goals.
PART 4. LEADING
Leadership styles
4.2.2
What is leadership styles?
✓ Leadership style is the manner and approach of
providing direction, implementing plans, and
motivating people.
PART 4. LEADING
Leadership styles
Styles of leadership in organizations
✓ Autocratic - the leader tells his or her
employees what to do and how to do it, without
getting their advice
✓ Participative - the leader includes one or more
employees in the decision making process, but
the leader normally maintains the final decision
making authority
✓ Free-rein - the leader allows the employees to
make the decisions, however, the leader is still
responsible for the decisions that are made
4.2.2
PART 4. LEADING
Leadership styles
4.2.2
Managers and employees
working together to make
decisions.
Autocratic
leadership
Making decisions without
consulting others.
Participative
leadership
Free-rein
leadership
Managers set objectives and
employees are free to do
whatever is appropriate to
accomplish those objectives.
PART 4. LEADING
Leadership styles
4.2.2
Exploring
your leadership styles
PART 4. LEADING
Leadership styles
4.2.2
Create a conversation between the leader
and the employee. That conversation
described one of the three leadership styles
learned and is done in 3 minutes.
PART 4. LEADING
Leadership styles
A significant influence on leadership styles
✓
✓
✓
✓
✓
✓
✓
✓
The turbulence
Uncertainty of the environment
Ethical and economic difficulties
Corporate governance concerns
Globalization
Changes in technology
Shifting employee expectation
…
4.2.2
PART 4. LEADING
Leadership and management
✓ Leadership
❖ The ability to influence people toward the
achievement of organizational goals.
✓ Management
❖ Promotes stability, order and problem solving
within the existing organizational structure and
systems.
4.2.3
PART 4. LEADING
Leadership and management
✓ Leadership cannot replace management, it should
be in addition to management.
✓ Good management is needed to help the
organization meet current commitments, while
good leadership is needed to move the
organization into the future.
✓ Leadership’s power comes from being built on the
foundation of a well-managed organization.
4.2.3
PART 4. LEADING
Leadership and management
4.2.3
PART 4. LEADING
Leadership traits
✓ Traits
are
the
distinguishing
personal
characteristics of a leader, such as intelligence,
honesty, self-confidence, and even appearance.
✓ The appropriateness of a trait or set of traits
depends on the leadership situation.
4.2.4
PART 4. LEADING
Leadership traits
4.2.4
PART 4. LEADING
Power and influence
✓ Power is the potential ability to influence the
behavior of others.
✓ Influence is the effect a person’s actions have on
the attitudes, values, beliefs or behavior of others.
✓ Whereas power is the capacity to cause a change
in a person, influence may be thought of as the
degree of actual change.
4.2.5
PART 4. LEADING
Power and influence
✓ Position power: The manager’s position gives
him or her the power to reward or punish
subordinates to influence their behavior.
❖ Legitimate power: power coming from a formal
management position in a organization and the
authority granted.
❖ Reward power: power that results from the
authority to bestow rewards on other people.
❖ Coercive power: power that stems from the
authority to punish or recommend punishment.
4.2.5
PART 4. LEADING
Power and influence
✓ Personal power: often comes from internal
sources, such as a individual’s special knowledge
or personal characteristics.
❖ Expert power: power that stems from special
knowledge of or skill in the tasks performed by
subordinates.
❖ Referent power: power that results from
characteristics that command subordinates’
identification with, respect and admiration for, and
desire to emulate the leader.
4.2.5
PART 4. LEADING
Power and influence
✓ Other sources of power: are not linked to
particular person or position but rather to the role
an individual plays in the overall functioning of the
organization.
❖ Personal effort
❖ Network of relationship
❖ Information
4.2.5
PART 4. LEADING
Power and influence
4.2.5
POSITION POWER
PERSONAL
POWER
OTHER SOURCES
OF POWER
• Legitimate
Power: formal
management
position.
• Reward Power:
use rewards to
influence.
• Coercive Power:
opposite of
reward power.
▪ Expert Power:
resulting from a
person’s special
knowledge or
skill.
▪ Referent Power:
comes from an
individual’s
personal
characteristics.
▪ Personal Effort:
work beyond what is
expected of them.
▪ Network of
Relationships
▪ Information
PART 5. CONTROLLING
5.1. Introduction to controlling
5.2. Managing operations
PART 5. CONTROLLING
Introduction to controlling
5.1
▪ Explain the nature and importance of
control
▪ Describe the three steps in the control
process
▪ Explain how organizational performance
is measured
▪ Describe tools used to measure
organizational performance
▪ Discuss contemporary issues in control
PART 5. CONTROLLING
What is controlling and why is it important?
✓ Controlling: the process of monitoring, comparing
and correcting work performance.
✓ As the final step in the management process,
controlling provides the link back to planning. If
managers didn’t control, they’d have no way of
knowing whether goals were being met.
5.1.1
PART 5. CONTROLLING
What is controlling and why is it important?
5.1.1
PART 5. CONTROLLING
What is controlling and why is it important?
✓ Control is important because:
❖ It’s the only way to know if goals are being met,
and if not, why.
❖ It provides information and feedback so managers
feel comfortable empowering employees.
❖ It helps protect an organization and its assets.
5.1.1
PART 5. CONTROLLING
The control process
5.1.2
PART 5. CONTROLLING
The control process
Step 1. Measuring actual performance
✓ Measuring involves deciding how to measure
actual performance and what to measure.
✓ How to measure: four approaches used by
managers to measure and report actual
performance are personal observations, statistical
reports, oral reports and written reports.
5.1.2
PART 5. CONTROLLING
The control process
Step 1. Measuring actual performance
5.1.2
PART 5. CONTROLLING
The control process
Step 1. Measuring actual performance
✓ What to measure: Some control criteria can be
used for any management situation. For instance,
all managers deal with people, so criteria such as
employee
satisfaction
or
turnover
and
absenteeism rates can be measured.
5.1.2
PART 5. CONTROLLING
The control process
Step 2. Comparing actual performance against
the standard
✓ Comparing determines the variation between
actual performance and the standard. Deviations
outside an acceptable range of variation need
attention.
5.1.2
PART 5. CONTROLLING
The control process
Step 3. Taking managerial action
✓ Taking action can involve doing nothing,
correcting the actual performance, or revising the
standards.
❖ Doing nothing is self-explanatory.
❖ Correcting the actual performance can involve
different corrective actions, which can either be
immediate or basic.
❖ Standards can be revised by either raising or
lowering them.
5.1.2
PART 5. CONTROLLING
The control process
Step 3. Taking managerial action
5.1.2
PART 5. CONTROLLING
Controlling for organizational performance
What is organizational performance?
✓ Organizational performance is the accumulated
results of all the organization’s work activities.
5.1.3
PART 5. CONTROLLING
Controlling for organizational performance
Measures of organizational performance
✓ Three
frequently
used
organizational
performance measure include:
❖ Productivity, which is the output of goods or
services produced divided by the inputs needed to
generate that output.
❖ Effectiveness, which is a measure of how
appropriate organizational goals are and how well
those goals are being met.
❖ Industry and company rankings compiled by
various business publications.
5.1.3
PART 5. CONTROLLING
Tools for measuring organizational performance
Feedforward/Concurrent/Feedback controls
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Feedforward/Concurrent/Feedback controls
✓ Feedforward controls take place before a work
activity is done.
✓ Concurrent controls take place while a work
activity is being done.
✓ Feedback controls take place after a work activity
is done.
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Financial controls
✓ Financial controls that managers can use include
financial ratios (liquidity, leverage, activity, and
profitability) and budgets.
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Financial controls
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Financial controls
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Balanced scorecards
✓ Balanced scorecards provide a way to evaluate
an organization’s performance in four different
areas rather than just from the financial
perspective.
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Balanced scorecards
5.1.4
PART 5. CONTROLLING
Tools for measuring organizational performance
Benchmarking
✓ Benchmarking provides control by finding the
best
practices
among
competitors
or
noncompetitors and from inside the organization
itself.
5.1.4
PART 5. CONTROLLING
Contemporary issues in control
✓ Adjusting
controls
for
cross-cultural
differences may be needed primarily in the areas
of measuring and taking corrective actions.
✓ Workplace concerns include workplace privacy,
employee theft, and workplace violence.
✓ Controlling customer interactions because
employee service productivity and service quality
influences customer perceptions of service value.
✓ Corporate governance is the system used to
govern a corporation so that the interests of
corporate owners are protected.
5.1.5
PART 5. CONTROLLING
List the common mistakes
encountered in the daily work
of your department?
For example: loss of customer property, customers
complaining about room hygiene, recruiting the wrong
employee, spending too much money on advertising
Each group has at least 5 mistakes of your department
PART 5. CONTROLLING
5.1. Introduction to controlling
5.2. Managing operations
PART 5. CONTROLLING
Managing operations
5.2
▪ Explain
the
role
of
operations
management
▪ Define the nature and purpose of value
chain management
▪ Describe how value chain management
is done
▪ Discuss
contemporary
issues
in
managing operations
PART 5. CONTROLLING
The role of operations management
✓ Operations management: the transformation
process that converts resources into finished
goods and services.
5.2.1
PART 5. CONTROLLING
The role of operations management
5.2.1
The operation system
Inputs
People
Outputs
Technology
Capital
Equipment
Materials
Information
Transformation
process
Goods
Services
PART 5. CONTROLLING
The role of operations management
5.2.1
✓ Operations management is important to
organizations and managers for three reasons:
❖ It encompasses both services and manufacturing.
❖ It’s important in effectively and efficiently managing
productivity.
❖ It plays a strategic role in an organizations
competitive success.
→ Organizations must recognize the crucial role that
operations management plays as part of their overall
strategy in achieving successful performance.
PART 5. CONTROLLING
The role of operations management
5.2.1
Services and manufacturing
✓ Manufacturing organizations: organizations that
produce physical goods.
✓ Service organizations: organizations that produce
nonphysical products in the form of services.
PART 5. CONTROLLING
The role of operations management
5.2.1
Productivity
✓ Productivity is a composite of people and
operations variables.
✓ A manager should look for ways to successfully
integrate people into the overall operations systems.
PART 5. CONTROLLING
What is value chain management and
why is it important?
5.2.2
What is value chain management?
✓ The value chain is the sequence of organizational
work activities that add value at each step from raw
materials to finished product.
✓ Value chain management is the process of
managing the sequence of activities and information
along the entire product chain.
PART 5. CONTROLLING
What is value chain management and
why is it important?
5.2.2
Goal of value chain management
✓ Goal of value chain management is to create a
value chain strategy that meets and exceeds
customers’ needs and desires and allows for full and
seamless integration among all members of the
chain.
PART 5. CONTROLLING
What is value chain management and
why is it important?
5.2.2
Benefits of value chain management
✓ Value chain management provides four main
benefits:
❖ Improved procurement
❖ Improved logistics
❖ Improved product development
❖ Enhanced customer order management
PART 5. CONTROLLING
Managing operations using
value chain management
5.2.3
Value chain strategy
✓ The six main requirements for successful value
chain management include:
❖ Coordination and collaboration
❖ Investment in technology
❖ Organizational processes
❖ Leadership
❖ Employees or human resources
❖ Organizational culture and attitudes
PART 5. CONTROLLING
Managing operations using
value chain management
Value chain strategy
5.2.3
PART 5. CONTROLLING
Managing operations using
value chain management
5.2.3
Obstacles to value chain management
✓ Obstacles to value chain management include:
❖ Organizational barriers (refusal to share information,
reluctance to shake up the status quo, or security
issues)
❖ Unsupportive cultural attitudes
❖ Lack of required capabilities
❖ People (employee unwilling or unable to do it)
PART 5. CONTROLLING
Managing operations using
value chain management
Obstacles to value chain management
5.2.3
PART 5. CONTROLLING
Contemporary issues in managing operations
5.2.4
Technology’s role in operation management
✓ The power of technology to contribute to more
effective and efficient performance know that
managing operations is more than the traditional
view of simply producing the product.
✓ The power of technology to improve their
operation management by extensive collaboration
and cost control.
PART 5. CONTROLLING
Contemporary issues in managing operations
5.2.4
Quality initiatives
✓ Quality: the ability of a product or service to reliably
do what it’s supposed to do and to satisfy customer
expectations.
✓ A good way to look at quality initiatives is with the
management functions: planning, organizing, leading
and controlling.
PART 5. CONTROLLING
Contemporary issues in managing operations
5.2.4
Quality goals
✓ ISO 9000 is a series of international quality
management standards that set uniform guidelines
for processes to ensure that products conform to
customer requirements.
✓ Six sigma is a quality standard that establishes a
goal of no more than 3,4 defects per million units or
procedures.
PART 5. CONTROLLING
Contemporary issues in managing operations
5.2.4
Mass customization and lean organization
✓ Mass customization: providing customers with a
product when, where, and how they want it. It
requires flexible manufacturing techniques and
continual customer dialogue.
✓ A lean organization is one that understands what
customer want, identifies customer value by
analyzing all activities required to produce products,
and then optimizes the entire process form the
customer’s perspective.
Thank You !
Author: Stephen P.ROBBINS and Mary COULTER
Instructor: Duong Cong Doanh
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