CHAPTER 5
Managing the Business
Enterprise
Reference: Ebert & Griffin (2007). "Business Essentials" Pearson, Prentice Hall
1
Setting Goals and
Formulating (‫ )يصيغ‬Strategy
Goal (‫)هدف‬
Objective that a business hopes and plans to achieve.
Goals are performance targets (‫—)أهداف األداء‬the means
by which organizations and their managers measure
success or failure at every level.
Strategy (‫)إستراتيجية‬
Broad (large) program underlying decision making
process (‫)عملية صنع القرار‬to assist managers in
achieving company goals
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
2
Purposes of setting Goals (1)
We have four main purposes in organizational goal setting:
1. Goal setting provides direction and
guidance (‫ )إرشاد‬for managers at all levels.
(example: increasing sales by 2% will clearly inform
everyone to find new customers or improve
current customers sales.)
2. Goals setting helps firms allocate
resources(‫)ثروة) (يخصص‬. (example: the company
allocates more resources to new projects with large
sales potential (‫)المحتملة‬, and less resources for
weak sales potential.)
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
3
Purposes of setting Goals (2)
3. Goal setting helps to define corporate
culture (‫)تثقيف‬. example: GE goal is to push each of its
divisions (electrical goods, financial services, aircraft
unit…etc) to become the 1st or 2nd in its industry. this results
in a competitive and stressful environment (corporate
culture) in that organization.
4.Goal setting helps managers assess
performance (‫)يحدد مقدار ضريبة‬. (if a unit sets a
goal of increasing sales by 10% in a given year, managers in
that unit who achieve this goal can be rewarded.)
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
4
Kinds of Goals
Goals differ from company to company, depending on the
firm’s purpose and mission. Every enterprise has a
purpose, or a reason for being.
•Businesses seek profits,
•universities seek to discover and transmit new
knowledge, and
•government agencies seek to set and enforce public
policy (law)
Mission Statement
Organization’s statement of how it will achieve its
purpose in the environment in which it conducts its
business.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
5
Kinds of Goals
Regardless of a company’s purpose and mission,
every firm has:
Long-term Goals
Goals set for an extended time, typically 5 years or more
into the future
Intermediate Goals
Goals set for a period of 1 to 5 years into the future
Short-term Goals
Goals set for the very near future, typically less than 1
year
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
6
Contingency planning and crisis management
(1).
• Business environments are often difficult to predict
(‫)يتنبأ‬.
• Most managers recognize that even best plans
sometimes simply do not work.
• Therefore managers develop alternative (‫)البديل‬
plans in case things go wrong.
• Two common methods of dealing with the unknown
(‫ )غير معروف‬and unforeseen are: contingency
planning and crisis management.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
7
Contingency planning and crisis management
(2).
1. Contingency planning )‫ (التخطيط لحاالت الطوارئ‬:
Identifying aspects of a business or its environment
that might entail (involve) changes in strategy.
2. Crisis Management )‫ (أدارة الكوارث‬: Organization’s
methods for dealing with emergencies.
(Example: www.filterfresh.com, September 11th, one extra hour because of
increased security, employed 24 new people. )
• Crises is an unexpected emergency requiring
immediate response.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
8
The Management Process
Management is the process of planning, organizing,
directing, and controlling an organization’s financial,
physical, human, and information resources to
achieve its goals.
•Planning (‫ )يرسم خطة‬what an organization needs to do
and how to get it done
•Organizing (‫)يؤسس‬how best to arrange an organization’s
resources and activities into a coherent (ً ‫)مترابط منطقيا‬
structure
•Directing (‫ )يوجه‬guiding and motivating (‫)يحث‬employees
to meet an organization’s objectives
•Controlling (‫)يضبط‬monitoring an organization’s
Reference:
Ebert & it
Griffin
"Business
performance to ensure
that
is(2007).
meeting
its goals
Essentials" Pearson, Prentice Hall
9
Types of Managers
Top Managers
Managers responsible (‫ )مسؤول‬to the board of directors and
stockholders for a firm’s overall performance and
effectiveness.
(e.g. president, CEO, CFO) they set general policies, formulate strategies,
approve the important decisions, and represent the company in dealing
with other businesses or government bodies.
Middle Managers
Managers responsible for implementing the strategies,
policies, and decisions made by top managers.
(Plant manager, operations manager, division manager). If top manager
decide to cut the cost by a 5%, the middle manager must decide how to do
meet this goal.
First-line Managers
Managers responsible for supervising the work of employees.
(such as Supervisor, office
managers,
group
leader).
Reference:
Ebert & Griffin
(2007). "Business
Essentials" Pearson, Prentice Hall
10
Levels of Management
Top manager
Middle Manager
First-Line
Manager
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
11
Areas of Management (1)



Human resource managers (‫)مدراء الموارد البشريه‬:
hire and train employees, evaluate performance, and
determine compensation (salaries and wages).
Operations managers (‫)مديري العمليات‬: responsible for
production, inventory, and quality control ( ، ‫ المخزون‬، ‫االنتاج‬
‫)ومراقبة الجوده‬. Manufacturing companies usually needs
operation managers such as Ford.
Marketing managers (‫)مدراء التسويق‬: responsible for
getting products from producers to consumers, they are
responsible for developing pricing, promotions, and
distribution for the products.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
12
Areas of Management (2)
 Information Managers (‫)مديري المعلومات‬: they
design and implement systems to gather, organize,
and distribute information. this is due to the increase
in the volume of information and the ability to
manage it.
 Financial Managers (‫)المديرين الماليين‬: almost every
company has a financial manager to plan and
oversee its accounting functions and financial
resources.
 Other Specialized Managers: some companies
need specialized managers, like public relation
managers, research and development managers..
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
13
Basic Management Skills (1)
 Technical Skills: )‫(الحرف التقنيه‬skills needed to
perform specialized tasks. (example: a programmer’s
ability to program. people develop these skills through
experience and education, these skills are important for firstline managers since they need to help the employees.)
 Human Relations Skills: skills in understanding
and getting along )‫)التآلف‬with people.( mostly
important for middle level managers, these are the
communications skills, and the ability to understand
employees and make them understand you. managers must
care about the welfare of his employee.)
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
14
Basic Management Skills (2)
 Conceptual Skills:)‫(الحرف الذهنيه‬abilities to
think in abstract (‫)مجردة‬, diagnose and analyze
(‫ )تشخيص وتحليل‬different situation, and see
beyond the present situation.
(these skills are needed in almost any job-related
activity, and are more required as the level of
management increase, it is the managers ability to
analyze the probable outcome of their decisions. The
ability to foresee the future prospect of a business
aspect.)
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
15

Basic Management Skills (3)
Time Management Skills: skills associated
with the productive use of time.
(manager’s time is valuable, and poor use of it
translates into cost and wasted productivity. Some
manager get paid high salaries, wasting their time
means wasting the stockholders money.
The four leading causes of wasted time:
1. Paperwork: mangers must organize their documents.
2. Telephone: managers get interrupted by phone calls, an assistant
must screen these calls to priorities.
3. Meetings: meetings must have agenda, start on time, and keep
everyone focused on the agenda, and end on time.
4. E-Mail: Managers depend on emails, it need sorting according to
its importance too.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
16
5.4: Basic Management Skills (4)
• Decision-Making Skills (‫)مهارات صنع القرار‬:
are the skills in defining problems and
selecting the best courses of action.
Decision-Making Skills steps
1. Define the problem(‫)تحديد المشكلة‬, gather the facts,
and identify alternative solutions.
2. Evaluate each alternative(‫ )تقييم كل بديل‬and select
the best one.
3. Implement the chosen alternative( ‫تنفيذ البديل‬
‫)المختار‬, periodically following up and evaluating the
Ebert
& Griffin (2007). "Business
effectiveness ofReference:
that
choice.
17
Essentials" Pearson, Prentice Hall
Porsche decision making steps
1. Porsche define their problem, they are losing their
market share. they developed alternatives: selling
their business to larger company of their choice, or
growing their business larger to ensure
independency
2. They evaluate the alternative, and preferred the
option of grow instead.
3. Implementing the chosen decision was to
introduce new product (SUV/4WD) into this highgrowth market.
Reference: Ebert & Griffin (2007). "Business
Essentials" Pearson, Prentice Hall
18