BUSINESS LEADERSHIP FINAL EXAM
REVIEW
Knowledge (MULTIPLE CHOICE)
4 Functions of Management
●​ Planning:
-​ The process of setting objectives and determining what actions should be taken to
accomplish them
●​ Organizing:
-​ The process of assigning tasks, allocating resources, and arranging the coordinated
activities of individuals and groups to implement plans
●​ Leading:
-​ The process of arousing people’s enthusiasm to work hard and direct their efforts to fulfill
plans and accomplish objectives
●​ Controlling:
-​ The process of measuring work performance, comparing results to objectives, and taking
corrective action as needed
Organizational Performance
ORGANIZATIONAL PERFORMANCE
●​ “Value creation” is a very important notion for organizations
●​ Value is created when an organization’s operations adds value to the original cost
of resource inputs
●​ When value creation occurs:
○​ Businesses earn a profit
○​ Nonprofit organizations add wealth to society
Productivity- An overall measure of the quantity and quality of outputs relative to the
cost of inputs
Performance effectiveness – An output measure of task or goal accomplishment
Performance efficiency- An input measure of the resource costs associated with goal
accomplishment
Upside-Down Pyramid
THE ORGANIZATION AS AN UPSIDE DOWN PYRAMID
-​ Reflects the changing nature of work today
-​ A manager’s job is to support workers’ efforts
-​ Whole organization is devoted to serving the customer
Douglas McGregor
Douglas McGregor – Theory X and Theory Y
Theory X Managers - Assumes people dislike work, lack ambition, are irresponsible, and prefer to be
led
Theory Y Managers - Assumes people are willing to work, accept responsibility, are self-directed and
creative
Self-Fulfilling Prophecy - Occurs when a person acts in ways that confirm others expectations
Alternative Views of Ethical Behaviour
1.​ Utilitarian view of ethics :
– Greatest good to the greatest number of people.
2.​ Individualism view of ethics :
– Primary commitment is to one’s long-term self-interests
3.​ Moral-rights view of ethics:
– Respects and protects the fundamental rights of all people.
4.​ Justice view of ethics :
– Fair and impartial treatment of people according to legal rules and standards
Whistleblower
Whistleblower - Exposes the misdeeds of others in organizations in order to preserve ethical
standards and protect against wasteful, harmful, or illegal acts.
-​ All were fired from their jobs.
-​ Face the risk of impaired career progress and other forms of organizational retaliation,
up to and including termination
Planning Process
STEPS IN THE PLANNING PROCESS:
●​ Define your objectives.
●​ Determine where you stand in relation to objectives.
●​ Develop premises regarding future conditions & develop alternative scenarios.
●​ Analyze alternatives and make a plan.
●​ Implement the plan and evaluate results.
Types of Plans
Intermediate-Range Plan
-​ Covers a time frame longer than one year but shorter than three years.
Short-Range Plan
-​ Covers one year or less.
Long-Range Plan
-​ Looks three or more years into the future.
Strategic Plan
-​ Identifies long-term directions for the organization.
Operational Plan
-​ Identifies activities to implement strategic plans.
Single-Use Plan
-​ A plan created for a one-time project or event that is not repeated.
Standing Plan
-​ A plan used regularly for recurring activities, such as policies or procedures.
Contingency Plan
-​ Identifies alternative courses of action to take when things go wrong (backup
plan).
Benchmarking
-​ Uses external comparisons to gain insights for planning.
Participatory Planning
-​ Includes the persons who will be affected by plans and/or who will implement
them (planning together).
Strategies Used by Organizations
Growth Strategies
Concentration
●​ Growth through concentration is within the same business area.
●​ Definition: Expanding within the same business area.
●​ Example: Starbucks opening more coffee shops globally or introducing VIA (instant coffee).
Diversification
●​ Growth through diversification is by acquisition of or investment in new and different business
areas.
●​ Definition: Expanding by acquiring or investing in new and different business areas.
●​ Example: Amazon entering the grocery market by acquiring Whole Foods; Pepsi acquiring
Tropicana.
●​ Acquisition of Tropicana by pepsi (originally the soft drink industry - entering in the juice
industry)
Vertical Integration
●​ Growth through vertical integration is by acquiring suppliers or distributors.
●​ Definition: Expanding by acquiring suppliers or distributors.
●​ Example: Tesla producing its own batteries; Walmart buying a major supplier; Amazon
purchasing a fleet of planes.
Restructuring Strategies
Restructuring
●​ Reduces the scale and/or mix of operations to improve performance.
●​ Definition: Changing the scale or mix of operations to gain efficiency or improve performance.
●​ Example: General Electric selling off its appliance division.
Turnaround
●​ Focuses on fixing specific performance problems.
●​ Definition: Financial recovery of a poorly performing organization, economy, or individual.
●​ Example: Apple’s revival under Steve Jobs with the iMac, iPod, and iPhone.
Downsizing
●​ Decreases the size of operations to cut costs.
●​ Definition: Reducing the size of operations to improve profitability.
●​ Example: Ford reducing its workforce and closing factories.
Divestiture
●​ Sells off parts of the organization to refocus on core business areas.
●​ Definition: Selling parts of an organization to refocus on the core business.
●​ Example: IBM selling its personal computer division to Lenovo.
Global Strategies
Globalization
●​ Adopts standardized products and advertising worldwide.
●​ Definition: Standardizing products and advertising for use worldwide.
●​ Example: Coca-Cola using the same branding globally; McDonald’s fries.
Multi-Domestic Strategy
●​ Customizes products and advertising to fit local needs.
●​ Definition: Adapting products and advertising for local markets.
●​ Example: McDonald’s offering unique menu items like the McAloo Tikki in India.
Transnational Strategy
●​ Seeks efficiencies of global operations while addressing local market needs.
●​ Definition: Balancing global efficiencies and local market needs.
●​ Example: Unilever producing Dove soap globally while tailoring marketing locally.
Cooperative Strategies
Strategic Alliance
●​ Organizations join in partnership to pursue mutual interests.
●​ Definition: Partnering to pursue an area of mutual interest.
●​ Example: Starbucks partnering with PepsiCo to distribute coffee beverages.
Co-opetition
●​ Collaboration between business competitors for mutual benefit.
●​ Definition: Competitors working together on mutually beneficial projects.
●​ Example: Samsung providing parts for Apple iPhones while competing in the smartphone
market.
E-Business Strategies
E-Business
●​ Strategically uses the internet to gain a competitive advantage.
●​ Definition: Using the internet strategically to compete.
●​ Example: Shopify enabling online stores globally.
B2B (Business to Business)
●​ Links organizations vertically in supply chains using IT and web portals.
●​ Definition: Connecting businesses within supply chains.
●​ Example: Walmart’s inventory system linked to suppliers for automatic ordering.
B2C (Business to Consumer)
●​ Links businesses with customers using IT and web portals.
●​ Definition: Connecting businesses directly to customers.
●​ Example: Amazon’s e-commerce platform.
Levels of Management and Their Functions
LEVELS OF MANAGEMENT
-​ Top managers: responsible for the performance of an organization as a whole or for one
of its larger parts
-​ Middle managers: in charge of relatively large departments or divisions
-​ Team leaders or supervisor: in charge of a small work group on non-managerial workers
TYPES OF MANAGERS
LINE MANAGER: are responsible for work activities that directly affect organization’s outputs
(i.e. president, retail manager, department supervisor) * policy makers, target setting, decision
making
Staff managers: work in specialized support areas such as marketing, accounting, human
resources, and legal department (i.e. Future shop’s director of Human resources, and CFO) *
expenses
Functional managers: are responsible for a single area of activity (i.e. marketing, production,
accounting, sales)
General managers: are responsible for more complex units that include many functional areas
(i.e. plant manager who oversees purchasing, manufacturing, warehousing, sales, personnel, and
accounting)
Administrators: work in public and nonprofit organizations (hospital administrators, public
administrators, city administrators, school administrators)
Line managers- revenue generators
Staff managers- revenue consumers
Types of Organizational Structures/Charts
Organization Structure:
-​ The system of tasks, workflows, reporting relationships, and communication channels that link
together diverse individuals and groups
FORMAL STRUCTURES
-​ The structure of the organization in its official state
-​ An organization chart is a diagram describing reporting relationships and the formal arrangement
of work positions within an organization
-​ An organization chart identifies the following aspects of formal structure:
➢​ The division of work
➢​ Supervisory relationships
➢​ Communication channels
➢​ Major subunits
➢​ Levels of management
INFORMAL STRUCTURES
-​ A “shadow” organization made up of the unofficial but often critical, working relationships
between organization members
-​ Potential advantages of informal structures:
➢​ Helping people accomplish their work
➢​ Overcoming limits of formal structure
➢​ Gaining access to interpersonal networks
➢​ Informal learning
TRADITIONAL ORGANIZATION STRUCTURES
-​ Functional structures
➢​ People with similar skills and performing similar tasks are grouped together into formal
work units
➢​ Members work in their functional areas of expertise
➢​ Are not limited to businesses
➢​ Work well for small organizations producing few products or services
FIGURE 7.3 FUNCTIONAL STRUCTURES IN A BUSINESS, BRANCH BANK, AND HOSPITAL
DIVISIONAL STRUCTURES
-​ Group together people who work on the same product or process, serve similar customers, and/or
are located in the same area or geographical region
-​ Common in complex organizations
-​ Types of divisional structures and how they group job and activities:
-​ Product structures focus on a single product or service
-​ Geographical structures focus on the same location or geographical region
-​ Customer structures focus on the same customers or clients
-​ Process structures focus on the same processes
FIGURE 7.4 DIVISIONAL STRUCTURES BASED ON PRODUCT, GEOGRAPHY, CUSTOMER,
AND PROCESS​
MATRIX STRUCTURE
-​
-​
-​
-​
Combines functional and divisional structures to gain advantages and minimize disadvantages of
each
Used in:
➢​ Manufacturing
➢​ Service industries
➢​ Professional fields
➢​ Non-profit sector
➢​ Multinational corporations
Potential advantages of matrix structures
➢​ Better cooperation across functions
➢​ Improved decision making
➢​ Increased flexibility in restructuring
➢​ Better customer service
➢​ Better performance accountability
➢​ Improved strategic management
Potential disadvantages of matrix structures:
➢​ Two-boss system is susceptible to power struggles
➢​ Two-boss system can create task confusion and conflict in work priorities
➢​ Team meeting are time consuming
➢​ Team may develop “grupitis”
➢​ Increased costs due to adding teams leers to structure
Organizing Trends and Practices
TRENDS IN ORGANIZATIONAL DESIGN
●​ Contemporary organizing trends include:
​
- Fewer levels of management
➢​ Shorter chains of command
➢​ Less unity of command
➢​ Wider spans of control
– More delegation and empowerment
– Decentralization with centralization
– Reduced use of staff
-​
-​
Less unit of command:
-​ Each person in an organization should report to one and only one supervisor
-​ Organizing trend
➢​ Organizations are using more cross-functional teams, task forces, and horizontal
structures
➢​ Organizations are becoming more customer conscious
➢​ Employees often find themselves working for more than one boss
Wider spans of control:
-​
-​
The number of persons directly reporting to a manager
Organizing trend:
➢​ Many organizations are shifting to wider spans of control as levels of
management are eliminated
➢​ Managers have responsibility for a larger number of subordinates who operate
with less direct supervision
-​ More delegation and empowerment:
➢​ Delegation is the process of entrusting work to others by giving them the right to make
decisions and take action
➢​ The manager assigns responsibility, grants authority to act, and creates accountability
➢​ Authority should include responsibility
-​ Three Steps in Delegation:
➢​ Assign responsibility - explain task and expectations
➢​ Grant authority - allow others to make decisions and act
➢​ Create accountability - require others to report back on results
-​ More delegation and empowerment
➢​ A common management failure is unwillingness to delegate
➢​ Delegation leads to empowerment
➢​ Organizing trend:
-​ Managers are delegating more and finding more ways to empower people at all
levels
●​ Decentralization with centralization:
– Centralization is the concentration of authority for making most decisions at the top levels of the
organization
– Decentralization is the dispersion of authority to make decisions throughout all levels of the
organization
Decentralization with centralization:
– Centralization and decentralization not an “either/or” choice
– Organizing trend:
●​ Delegation, empowerment, and horizontal structures contribute to more decentralization in
organizations
●​ Advances in information technology allow for the retention of centralized control
●​ Reduced use of staff:
-​ Specialized staff:
➢​ People who perform a technical service or provide special problem-solving
expertise to other parts of the organization
-​ Personal staff:
➢​ People working in “assistant-to” positions that provide special support to
higher-level managers
-​
Organizing trend:
➢​ Organizations are reducing staff size
➢​ Organizations are seeking increased operating efficiency by employing fewer staff
personnel and smaller staff units
Power and Influence
●​ Power
➔​ The ability to get someone else to do something you want done or make things happen in
the way you want
●​ Power should be used to influence and control others for the common good rather than seeking to
exercise control for personal satisfaction
●​ Two sources of managerial power:
➔​ Position power
➔​ Personal power
●​ Position power:
➔​ Based on a manager;s official status in the organization’s hierarchy of authority
●​ Sources of position power:
➔​ Reward power: Capable of offering something with value
➔​ Coercive power: Capable of delivering punishment or withholding positive outcomes
➔​ Legitimate power: Organizational position or status confers the right to control those in
subordinate positions
●​ Personal power
➔​ Based on the unique personal qualities that a person brings to leadership situation
●​ Sources of personal power:
-​ Expert power
➔​ Capacity to influence others because of one’s knowledge and skills
-​ Referent power:
➔​ Capacity to influence others because they admire you and want to identify positively with
you
Characteristics of Leaders
LEADERSHIP AS A SERVICE
●​ Servant leadership:
➔​ Commitment to serving others
➔​ Followers more important than leader
➔​ “ Other centered” not “self-centered”
➔​ Power not a “zero-sum” quantity (Not worried about power)
➔​ Focuses on empowerment, not on power
●​ Servant Leadership and Empowerment:
➔​ Empowerment:
-​ The way in which managers enable and help others to gain power and achieve
influence.
➔​ Effective leaders empower others by providing them with:
-​ Information
-​ Responsibility
-​
-​
Authority
Trust
LEADERSHIP TRAITS
➔​ Drive
➔​ Self-confidence
➔​ Creativity
➔​ Cognitive ability
➔​ Business knowledge
➔​ Motivation
➔​ Flexibility
➔​ Honesty and integrity
Motivation Theories
Motivation and Rewards:
➢​ Motivation: the forces within the individual that account for the level, direction, and
persistence of effort expended at work
➢​ Reward : a work outcome of positive value to the individual
➢​ Extrinsic rewards : valued outcomes given to someone by another person
➢​ Intrinsic rewards : valued outcomes that occur naturally as a person works on a task
Extrinsic Reward Theories
Needs:
➢​ Are unfulfilled physiological and psychological desires of an individual
➢​ Explain workplace behaviour and attitudes
➢​ Create tensions that influence attitudes and behaviour
➢​ Good managers and leaders facilitate employee need satisfaction
➢​ Hierarchy of needs theory:
-​ Developed by Abraham Maslow
-​ Lower-order and higher-order needs affect workplace behaviour and attitudes
-​ Lower-order needs:
●​ Physiological, safety, and social needs
●​ Desires for physical and social well being
-​ Higher-order needs:
●​ Esteem and self-actualization needs
●​ Desire for psychological growth and development
➢​ Hierarchy of needs theory con’t:
-​ Deficit Principle:
●​ A satisfied need is not a motivator of behaviour
-​ Progression Principle:
●​ A need at one level does not become activated until the next lower-level
need is satisfied
***Two-Factor Theory:
●​ Developed by Frederick Herzberg
➢​ Hygiene factors
-​ Elements of the job context
-​ Sources of job dissatisfaction.
➢​ Satisfier factors
-​ elements of the job content
➢​Sources of job satisfaction and motivation
Alternative Work Arrangements
ALTERNATIVE WORKING SCHEDULES (Recognize Terminology)
●​ Flexible Working Hours:
– Give employees some choice in daily work hours (disadvantage: time frame when not everyone works)
●​ Compressed Workweek:
– Allows a full-time job to be completed in less than five days
●​ Job Sharing:
– Splits one job between two or more people
●​ Telecommuting:
– Involves using IT to work at home or outside the office
●​ Part-Time Work:
– Temporary employment for less that the standard 40-hour workweek
Teams in Organizations
Definition and Purpose of Teams
●​ A team is a small group of people with complementary skills working together to achieve a
shared purpose.
●​ Members hold themselves mutually accountable for performance results.
Benefits of Teams
●​ Synergy: Teams create a whole greater than the sum of individual efforts, maximizing
membership resources.
●​ Advantages:
○​ More resources for problem-solving.
○​ Improved creativity and innovation.
○​ Better quality of decision-making.
○​ Greater commitment to tasks and higher motivation through collective action.
○​ Improved work discipline and satisfaction of individual needs.
Challenges in Teams
●​ Common problems:
○​ Social loafing: Some members contribute less effort.
○​ Personality conflicts and individual differences in work styles.
○​ Ambiguous agendas or ill-defined problems.
○​ Poor team organization or lack of preparation.
●​ Meeting issues:
○​ People arrive late or leave early.
○​ Lack of focus or structure.
○​ Decisions aren’t acted upon or are postponed due to missing information.
Types of Teams
1.​ Formal Teams:
○​ Officially recognized by the organization, created for specific tasks.
○​ Managers serve as “linking pins” between teams.
2.​ Informal Teams:
○​ Form naturally through relationships, such as friendship or support groups.
○​ Can positively impact performance and satisfy social needs.
3.​ Cross-Functional Teams:
○​ Members from different departments solve organization-wide problems.
4.​ Virtual Teams:
○​ Collaborate primarily through computer-mediated communication.
○​ Useful for geographically dispersed members.
5.​ Self-Managing Teams:
○​ High task interdependence and autonomy to make decisions.
Stages of Team Development
1.​ Forming: Orientation and getting acquainted.
2.​ Storming: Conflict arises over roles and tasks.
3.​ Norming: Team members consolidate around shared goals and rules.
4.​ Performing: Productive teamwork and task completion.
5.​ Adjourning: The team disbands after achieving its goals.
Managing Team Norms and Cohesiveness
●​ Team norms: Behaviors expected of team members, guiding work effort and interactions.
●​ Cohesiveness: The degree to which members are attracted to and motivated to stay in the team.
○​ Positive norms + high cohesiveness = High performance.
○​ Negative norms + high cohesiveness = Low performance.
Conflict in Teams
●​ Functional conflict: Constructive and fosters creativity and improvement.
●​ Dysfunctional conflict: Destructive and hinders team performance.
●​ Conflict Management Styles:
○​ Avoidance: Uncooperative and unassertive.
○​ Accommodation: Cooperative but unassertive.
○​ Competition: Uncooperative but assertive.
○​ Compromise: Moderately cooperative and assertive.
○​ Collaboration: Cooperative and assertive, leading to win-win outcomes.
Characteristics of High-Performing Teams
●​
●​
●​
●​
●​
Clear and elevating goals.
Task-driven, results-oriented structures.
Competent, committed, and collaborative members.
High standards of excellence.
External support, recognition, and strong leadership.
Conflict Management Styles
1.​ Avoidance (Withdrawal):
○​ Uncooperative and unassertive.
2.​ Accommodation (Smoothing):
○​ Cooperative and assertive.
3.​ Competition (Authoritative Command):
○​ Uncooperative and assertive.
4.​ Compromise:
○​ Moderately cooperative and assertive.
5.​ Collaboration (Problem Solving):
○​ Cooperative and assertive.
SYNERGY - Is the creation of a whole greater than the sum of its individual parts
Synergy:
– The creation of a whole that is greater than the sum of its parts
– A team uses its membership resources to the fullest and thereby achieves through
collective action far more than could be achieved otherwise
Types of Conflict
●​ Lose-Lose Conflict:
○​ Managed by avoidance or accommodation.
●​ Win-Lose Conflict:
○​ Managed by competition or compromise.
●​ Win-Win Conflict:
○​ Managed by collaboration.
Thinking (SHORT ANSWER)
Motivation Theories
What Is Motivation?
●​ Needs:
○​ Unfulfilled physiological and psychological desires of an individual.
○​ Explain workplace behavior and attitudes.
○​ Create tensions that influence attitudes and behavior.
○​ Good managers and leaders facilitate employee need satisfaction.
Extrinsic Reward Theories
1.​ Hierarchy of Needs Theory
○​ Developed by Abraham Maslow.
○​ Lower-Order Needs:
■​ Physiological, safety, and social needs.
■​ Desires for physical and social well-being.
○​ Higher-Order Needs:
■​ Esteem and self-actualization needs.
■​ Desires for psychological growth and development.
○​ Principles:
■​ Deficit Principle: A satisfied need is not a motivator of behavior.
■​ Progression Principle: A need at one level does not become activated
until the next lower-level need is satisfied.
2.​ ERG Theory
○​ Developed by Clayton Alderfer.
○​ Three Need Levels:
■​ Existence Needs:
■​ Desires for physiological and material well-being.
■​ Corresponds to Maslow’s physiological and safety needs.
■​ Relatedness Needs:
■​ Desires for satisfying interpersonal relationships.
■​ Corresponds to Maslow’s social needs.
■​ Growth Needs:
■​ Desires for continued psychological growth and development.
■​ Corresponds to Maslow’s esteem and self-actualization needs.
○​ Key Features:
■​ Any/all needs can influence behavior simultaneously.
■​ Does not assume a rigid hierarchy like Maslow.
■​ Frustration-Regression Principle:
■​ If a higher-order need is frustrated, an individual seeks to increase
the satisfaction of a lower-order need.
■​ Example: Inability to satisfy social interaction needs may increase
the desire for more money or better working conditions.
3.​ Two-Factor Theory
○​ Developed by Frederick Herzberg.
○​ Hygiene Factors:
■​ Elements of the job context.
■​ Sources of job dissatisfaction.
○​ Satisfier Factors:
■​ Elements of the job content.
■​ Sources of job satisfaction and motivation.
SWOT
Strength and weaknesses *ON EXAM (internal environment about the company being
analyzed)
SWOT
●​ SWOT analysis
○​ Strengths
■​ Manufacturing efficiency?
■​ Skilled workforce?
■​ Good market share?
■​ Strong financing?
■​ Superior reputation?
○​ Weaknesses
■​ Outdated facilities?
■​ Inadequate research and development?
■​ Obsolete technologies?
■​ Weak management?
■​ Past planning failures?
○​ Opportunities
■​ Possible new markets?
■​ Strong economy?
■​ Weak market rivals?
■​ Emerging technologies?
■​ Growth of existing market?
○​ Threats
■​ What are our Threats?
■​ New competitors?
■​ Shortage of resources?
■​ Changing market tastes?
■​ New regulations?
■​ Substitute products?
*Come back and give examples Opportunities and threats (external environment)
Social Responsibility Strategies
-​ Proactive (shows leadership in CSR)
-​ Meets all the criteria of CSR, including discretionary performance
-​ Meet economic, legal, ethical, and discretionary responsibilities
-​ Accommodative (involved to some degree)
-​ Accepts CSR and tries to satisfy economic, legal and ethical criteria
-​ Meet economic, legal, and ethical responsibilities
-​ Defensive (do minimum required)
-​ Seeks protection by doing the minimum legally required
-​ Meet economic and legal responsibilities
-​ Obstructionist (fight social demands).
-​ Avoids social responsibility and reflects mainly economic priorities
-​ Meet economic responsibilities
HERTZBERG’S TWO FACTOR THEORY Thinking of EXAM
Complete the chart below using pages 363.
FACTOR
SATISFIER/MOTIVATO
R FACTOR
DESCRIPTIO
N OF THE
FACTOR
A satisfier
factor is found
in job content,
such as a
sense of
achievements,
recognition,
responsibility,
advancement,
or personal
growth
FILL IN THE BLANKS
Improving the
satisfier/motivat
or factors
_Increase job
satisfaction_.
EXAMPLE
S OF
HOW A
MANAGER
WOULD
USE IT
HYGIENE FACTOR
A hygiene
factor is found
in the job
context, such
as working
conditions,
interpersonal
relations,
organizational
policies, and
salary
Improving the
hygiene factors
_Decrease job
dissatisfaction
_.
Application (CASE STUDY)
Corporate Social Responsibility
Define corporate social responsibility and the triple bottom line:
Corporate social responsibility is based on the belief that businesses have a greater duty
to society than just providing jobs and making profits. It asks business leaders to consider their
decisions' environmental and social impacts in order to reduce harm where possible.
Triple bottom line - publish reports on a website regarding social, environmental and
financial. The triple bottom line aims to measure the financial, social, and environmental
performance of a company over time.
-​ Annual report
-​ Social responsibility: Charity donations, initiatives, ect…
-​ Environmental: what are they doing to help the environment, or reduce their carbon
footprint
Profit, people, and planet
Evaluating CSR
Zone of compliance
-​ Economic responsibility: Be profitable
-​ Legal responsibility: Obey the law
-​ Ethical responsibility: Do what is right
-​ Discretionary responsibility: Contribute to the community
UP
Strategic Management
STRATEGIC MANAGEMENT
●​ Basic concepts of strategy:
– Competitive advantage : operating with an attribute or set of attributes that allows an
organization to outperform its rivals.
-​ Cost and quality
-​ Knowledge and speed
-​ Barriers to entry (Makes it hard for competitors to even enter the industry)
-​ Financial resources (They can use the money to reinvest and gain more
profit)
– Sustainable competitive advantage: one that is difficult for competitors to imitate.
(could be an emotional connection)
BASIC CONCEPTS OF STRATEGY
●​ Strategy: a comprehensive action plan that identifies long-term direction for an
organization and guides resource utilization to accomplish organizational goals
with sustainable competitive advantage.
●​ Strategic intent: focusing all organizational energies on a unifying and
compelling goal
LEVELS OF STRATEGIES
●​ Corporate strategy:
– sets long-term direction for the total enterprise
●​ Business strategy:
– identifies how a division or strategic business unit will compete in products or services
●​ Functional strategy:
– guides activities within one specific area of operations
STRATEGIC MANAGEMENT PROCESS
Strategic management: the process of formulating and implementing strategies to
accomplish long-term goals and sustain competitive advantage
●​ Strategic analysis: process of analyzing the organization, the environment, its
competitive position and current strategies
●​ Strategy formulation: the process of crafting strategies to guide allocation of
resources
●​ Strategy implementation: putting strategies into action
ESSENTIALS OF STRATEGIC ANALYSIS
Analysis of mission:
– The reason for an organization’s existence
– An important test of the mission is how well it
serves the organization’s stakeholders
Upside-Down Pyramid
THE ORGANIZATION AS AN UPSIDE DOWN PYRAMID
-​ Reflects the changing nature of work today
-​ A manager’s job is to support workers’ efforts
-​ Whole organization is devoted to serving the customer
Stakeholders
Chain of command - Links all persons with successively higher levels of authority
●​ Trend - Organizations are being “streamlined” by cutting unnecessary levels of
management; flatter more horizontal structures are viewed as a competitive advantage
Less unity of command - Unity of command states each person and an organization should report to one
and only one supervisor
●​ Trend- Organizations are using more cross functional teams task forces and horizontal
structures and they're becoming more customer conscious as they do so employees often
find themselves working for more than one boss
Span of control - Is the number of subordinate directly reporting to a manager
●​ Trend- Many organizations are shifting to wider expense control as levels of management are
eliminated managers are taking responsibility for larger numbers of subordinates who operate
with less direct supervision
○​ When span of control is narrow only a few people are under a managers immediate
supervision
○​ When span of control is wide it indicates that our manager provides as many people
Delegation- Is the process of distributing an interesting work to other people
●​ Trend- Managers and progressive organizations are delegating more they are finding more ways
to empower people at all levels to make more decisions affecting themselves and their work
Decentralization with centralization ●​ Centralization is the concentration of authority for most decisions at the top level of an
organization
●​ Decentralization is a depression of authority to make decision decisions throughout all
organization levels
○​ Trend- Where as delegation empowerment and horizontal structures are contributing to
more decentralization in organizations advances and information tech technologies to
mainly allow for the retention of centralized control
Reduced of staff
●​ Specialized staff are provided technical expertise for other parts of the organization
●​ Personal staff are assistant two positions that support senior managers
○​ Trend- Organizations are reducing the size of stuff they are seeking lower cost and
increased operating efficiency by employing fewer personnel and using smaller staff units
Communication (LONG ANSWER)
Changing Nature of Organizations
●​ Changing nature of organizations (Ch 1. Pg. 13)
*Be able to describe, provide an example and discuss the future impact of
each transition/trend
IMPORTANT EXAM PREP: Using page 13 and 14 of your textbook, make detailed
notes on:
CHANGING NATURE OF ORGANIZATIONS (Communication on EXAM)​
For each transition/trend:​
​
1. Describe the transition/trend
2. Provide an example (think of one/make a realistic one up or research something)
3. Discuss the future impact of the transition/trend
CHANGING NATURE OF ORGANIZATIONS,
ALTERNATIVE WORK ARRANGEMENTS, JOB DESIGN,
MOTIVATION, & TEAMWORK/CONFLICT MANAGEMENT
TECHNIQUES
Please complete this handout using the textbooks provided in class. They will be
extremely helpful in studying these last few topics for the final exam.
CHANGING NATURE OF ORGANIZATIONS (this was already assigned)
Complete the chart below using pages 13-14 and your own thoughts and
ideas.
ORGANIZATIONAL
TRANSITION/TREND
DESCRIPTION
OF THE TREND
Belief in Human Capital
Demands of the
new economy
place premiums
on
high-involvement
and participatory
work settings that
rally the
knowledge,
experience, and
commitment of all
members
EXAMPLE
(YOUR OWN
IDEA OR
RESEARCH
ONE)
Google
encourages
employee
innovation by
allocating 20%
of their time to
personal
projects,
leading to
creative
developments
like Gmail.
FUTURE IMPACT OF
THIS
ORGANIZATIONAL
TREND
Organizations that
prioritize human
capital will likely
experience increased
innovation and
adaptability, leading
to sustained
competitive
advantage.
Organizations will see
higher productivity
and creativity when
employees feel valued
and well-trained.
Demise of “command
and control”
Emphasis on teamwork
Pre-eminence of
technology
Embrace of networking
Traditional
hierarchical
structures with
“do as I say”
bosses are proving
too slow,
conservative, and
costly to do well in
today’s
competitive
environments
Today’s
organizations are
less vertical and
more horizontal in
focus; they are
increasingly driven
by teamwork that
pools talents for
creative problem
solving
Example:
Zappos adopted
a "holacracy,"
where
decision-making
is distributed
among
employees
instead of
relying on strict
hierarchies.
Example:
Spotify uses
'squads,' small
teams from
different
departments, to
solve problems
and create new
features.
Organizations will
become more flexible
and faster at adapting
to market changes,
improving efficiency
and employee
satisfaction.
New opportunities
appear with each
new development
in computer and
information
technology; they
continually change
the way
organizations
operate and how
people work
Organizations are
networked for
intense real-time
communication
and coordination,
internally among
parts and
externally with
partners,
contractors,
suppliers, and
customers
Example:
Amazon uses
robots in
warehouses to
speed up order
processing and
reduce costs.
Companies will rely
on new technologies
to stay competitive,
save time, and
improve operations.
LinkedIn
connects
professionals
and companies
worldwide,
enabling
networking,
recruiting, and
partnerships.
Networking will foster
better collaboration,
faster
decision-making, and
stronger connections
with partners and
customers.
Teamwork will drive
innovation, improve
problem-solving, and
create a stronger
sense of unity within
organizations.
New workforce
expectations
A new generation
of workers brings
to the workplace
less tolerance for
hierarchy, more
informality, and
more attention to
performance merit
than to status and
seniority.
Example:
Tiktok
encourages an
informal work
culture, with
casual dress
codes, flexible
hours, and
performance-ba
sed rewards.
Companies that adapt
to these expectations
will attract younger,
skilled workers who
prefer a more
dynamic and modern
workplace.
Concern for work-life
balance
As society
increases in
complexity,
workers are
forcing
organizations to
pay more
attention to
balance in the
often conflicting
demands of work
and personal
affairs
Everything moves
fast today; in
business those
who get products
to market first
have the
advantage, and in
any organization
work is expected
to be both well
done and timely
Example:
Microsoft allows
flexible work
hours and
supports
employees with
wellness
programs.
Businesses that
support work-life
balance will see
improved employee
well-being, lower
turnover, and higher
productivity.
Example: Apple
quickly releases
updates and
new iPhone
models to stay
ahead in the
competitive
tech market.
Speed will help
organizations stay
ahead of trends, meet
customer needs
quickly, and maintain
a competitive edge.
Focus on speed
JOB ENRICHMENT
CORE
CHARACTERISTICS
1- Skill Variety
DESCRIPTION
-​
The degree to which a job requires a variety of
different activities to carry out the work, and involves
the use of a number of different skills and talents of
the individual.
2-Task Identity
-​
The degree to which the job requires completion of a
“Whole” and identifiable piece of work, one that
involves doing a job from beginning to the end with a
visible outcome.
3-Task Significance
-​
The degree to which the job has a substantial impact
on the lives or work of other people elsewhere in the
organization or in the external environment.
4-Autonomy
-​
The degree to which the job gives the individual
freedom, independence, and discretion in scheduling
work and in choosing procedures for carrying out.
5-Feedback from the
job itself
-​
The degree to which work activities required by the
job result in the individual obtaining direct and clear
information on his or her performance.
These are all ways to enrich jobs and increase motivation and job satisfaction
and work effectiveness. According to this model, job satisfaction and
performance are influenced by three critical psychological states:
1. Experienced meaningfulness of the work
2. Experienced responsibility for the outcomes of the work
3. Knowledge of actual results of work activities
CONFLICT MANAGEMENT STYLES
Complete the chart below using page 460.
CONFLICT
MANAGEMENT STYLE
DESCRIPTION OF THE STYLE
ACCOMMODATION
Or smoothing- being co-operative but unassertive but; letting
the wishes of others rule; smoothing over or overlooking
differences to maintain harmony
AVOIDANCE
Or withdrawal- being unco-operative and unassertive;
downplaying disagreement, withdrawing from the situation,
and/or staying neutral at all costs
COMPETITION
COMPROMISE
Or authoritative command - Being un-operative but
assertive; working against the wishes of the other party,
engaging in win-lose competition, and/or first forcing through
the exercise of authority
Or problem solving - Being moderately cooperative and
assertive; bargaining for “acceptable” solutions in which each
party wins a bit and loses a bit
COLLABORATION
Or problem solving - Being cooperative and assertive; trying
to fully satisfy everyone's concerns by working through
differences; finding and solving problems so that everyone
gains
Which one of these results in a WIN-LOSE conflict? Where each party is gaining at
the others’ expense.
Competition results in a WIN-LOSE conflict, as it involves working against the wishes
of the other party and engaging in win-lose competition.