© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter Objectives
 Summarize the demographics of the new American
workforce.
 Explain why America’s education and workplace
readiness situation is a crisis.
 Define the term managing diversity, and explain why it
is particularly important today.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter Objectives (cont’d)
 Discuss how the changing political-legal environment
is affecting the practice of management.
 Discuss why business cycles and the global economy
are vital economic considerations for modern
managers.
 Describe the three-step innovation process, and define
the term intrapreneur.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Social Environment
 Dimensions of the Social Environment
 Demographics

Changes in the statistical profiles of population
characteristics
 Inequalities

Persistent barriers encountered by women, minorities, and
others in the workplace
 Managing diversity

Creating organizational cultures that enable all employees
to realize their potential
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Demographics of the New Workforce
 It is getting larger, increasingly female, more racially
and ethnically diverse, older, and more age-diverse.
 America’s Education and Workplace Skills Crisis
 To compete in a global labor market, U.S. workers need a
constantly improving, world-class education – but
American kids aren’t getting one
 Problems start early and persist throughout the
education process
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Demographics of the
New Workforce (cont’d)
 Myths About Older Workers
 They are less productive.
 They incur higher benefits costs.
 They have higher absenteeism.
 They have more accidents at work.
 They are less willing to learn.
 They are inflexible about the hours they are willing to
work.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Figure 3.1: The Changing
U.S. Workforce: 2008-2018
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Figure 3.1: The Changing
U.S. Workforce: 2008-2018 (cont)
Nagging Inequalities in the Workplace
 Under the Glass Ceiling
 Women continue to experience a significant genderwage gap and strong barriers to advancement.
 Women are demanding more equitable compensation
and workplace opportunities.
 Many women are leaving the corporate ranks to start
their own businesses.
 Continuing Pressure for Equal Opportunity
 Women, minorities, and the physically challenged are all
expected to press harder for more employment
opportunities.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Nagging Inequalities
in the Workplace (cont’d)
 About 17% of the U.S. labor force is made up of
contingent workers.
 Reasons:
 Less costly
 Can be let go when times are bad
 There is lower job involvement among part-timers in
comparison to their full-time counterparts
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Managing Diversity
 Managing Diversity
 The process of creating an organizational culture
that provides all employees, including women and
minorities, with assistance and opportunities to
help them realize their full potential
 More Than EEO
 The moral necessity and commitment in going
beyond EEO and affirmative action to create
flexible organizations that encompass and value
diversity
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Political-Legal Environment
 Politics is the art (or science) of public influence or
control
 The Politicization of Management
 Issues management
 Ongoing process of identifying, evaluating, and
responding to important social and political issues
 Purpose: Minimize “surprises” and make more
systematic and effective responses to issues
 General political responses
 Defending the status quo against all comers
 Adopting a “wait and see” approach
 Proactively trying to identify and respond to issues
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Figure 3.2: Management’s
Political Response Continuum
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The Political-Legal Environment (cont’d)
 Specific Political Strategies
 Campaign financing

Political action committees (PACs)
 Lobbying

Garnering political support
 Coalition building

Common rallying points
 Indirect lobbying

Advocacy advertising
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Increased Personal Legal Accountability
 Increases in Demands for Accountability
 Sarbanes-Oxley Act (2002)
 Increased penalties for accounting fraud
 Established a new felony with stiff prison term for
securities fraud
 Political and Legal Implications for Management
 Increased use of legal audits
 A review of all operations to pinpoint possible legal
liabilities or problems
 Use of alternative dispute resolution (ADR)
 Settling disputes with less costly methods, including
arbitration and mediation
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Economic Environment
 The Job Outlook in Today’s Service Economy, Where
Education Counts
 Service providers are expected to generate 14.5 million
jobs between 2008 and 2018.
 A solid educational foundation and networking skills
are especially important in tough economic times.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Economic Environment
 Coping with Business Cycles
 Up-and-down movement of an economy’s ability to
generate wealth
 Predictive structure but variable timing
 Cycle-Sensitive Decisions
 Timing is everything
 Stay ahead of the pack
Benefiting from Economic Forecasts
 Use a consensus approach
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Figure 3.3: Business
Cycles Affect Managerial Decisions
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Challenge of a Global Economy
 A Single Global Marketplace
 Global trade is causing a shift to a single economy.
 The size of the global economy has expanded
dramatically.
 Globalization Is Personal
 A growing trend: Working for a foreign-owned
company.
 Meeting world standards for quality and costs
(through lower wages) is necessary to be globally
competitive.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Technological Environment
 Technology
 Technology includes all the tools and ideas available for
extending the natural and mental reach of humankind.
 Technology is facilitating the evolution of the
information age.
 Information has become a valuable strategic resource
for gaining competitive advantage.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Table 3.1: Science Fiction Is Becoming
Reality with Seven New Technologies
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Technological Environment (cont’d)
 The Innovation Process
 The systematic and practical application of a new
idea
 Steps in the Innovation Process
 Conceptualization: When a new idea occurs to
someone
 Product technology: Creation of a working
prototype
 Production technology: Development of a
profitable production process
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Figure 3.4: The
Three-Step Innovation Process
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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The Technological Environment (cont’d)
 Innovation Lag
 The time it takes for a new product to be translated into
satisfied demand
 Shortening Innovation Lag
 Goal setting: Creating a sense of urgency and purpose
 Empowerment: Pushing decision-making authority
down to the level of the decision
 Concurrent engineering: Using a team approach to
product design involving specialists from all functional
areas including research, production, and marketing
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Promoting Innovation
Through Intrapreneurship
 Intrapreneur
 An employee who takes personal responsibility for
pushing an innovative idea through a large
organization
 Fostering Intrapreneurship
 Focus on results and teamwork
 Reward innovation and risk taking
 Tolerate and learn from mistakes
 Remain flexible and change-oriented
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Summary
 The U.S. workforce will continue to become larger,
older, more diverse, and more female.
 America’s education system has major problems at all
levels.
 The persistence of opportunity and income
inequalities (and the glass ceiling) among women and
minorities is a strong stimulus for change.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Summary (cont’d)
 Managers are becoming increasingly politicized and
more likely to be held personally responsible for their
decisions and actions.
 Managers can make timely decisions during somewhat
unpredictable business cycles by taking a consensus
approach to economic forecasts.
 A healthy innovation process is vital to technological
development. An organizational climate that fosters
intrapreneurship can help.
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Terms to Understand
 Demographics
 Business cycle
 Glass ceiling
 Technology
 Contingent workers
 Innovation process
 Managing diversity
 Product technology
 Issues management
 Production technology
 Advocacy advertising
 Innovation lag
 Legal audit
 Concurrent engineering
 Alternative dispute
 Intrapreneur
resolution
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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