The Management of Organizations
An Introduction
Minder Chen
Professor of MIS
Martin V. Smith School of Business and Economics
CSU Channel Islands
Minder.Chen@csuci.edu
The Changing Nature of Work
• Farming –24/7, work=family, “jack of all trades”,
“rugged individualism”yet tight communities
• Craft –artisan/apprentice hierarchy, do whole task
(shoes, etc.)
• Mass Production –separate work/family, division
of labor, assembly line, owners vs. union, classic
social contract of loyalty for security
• Knowledge Work –educated, professional, mobile
“human capital” with “careers”
• Service Work –the “new factory” is McDonald and
Wal-Mart, but….
Source: MIT Prof. John Carroll (pdf)
© Minder Chen, 2014
Introduction - 2
Today’s Management Crises
• 1940s-70s: General Motors–Wage leader: Wage
formula negotiated with United Auto Workers: 3% plus
productivity and cost of living adjustments–Introduced
pensions, health insurance, joint training funds, workfamily benefits…–Other firms forced to match GMs
rising wages/benefits
• 2000s Wal-Mart–Largest US employer (1.8 million
people)–Average wage 30% below national average;
50% turnover !!–Class action suits for gender
discrimination and overtime pay–Resists
unionization—watch for media counter blitz!–Other
firms match Wal-Mart lower wages/benefits (not all)–
GM today: Delphi spin-off in bankruptcy, GM on the
brink
• And don’t forget Enron, WorldCom, China, India,…
Source: MIT Prof. John Carroll (pdf)
© Minder Chen, 2014
Introduction - 3
Wal-Mart vs. Costco
http://money.cnn.com/2013/08/06/news/economy/costco-fast-food-strikes/
© Minder Chen, 2014
Introduction - 4
Five Basic Tasks of a Manager
• Sets objectives. The manager sets goals for the group, and
decides what work needs to be done to meet those goals.
• Organizes. The manager divides the work into manageable
activities, and selects people to accomplish the tasks that need
to be done.
• Motivates and communicates. The manager creates a team
out of his people, through decisions on pay, placement,
promotion, and through his communications with the team. It is
also referred to as the “integrating” function of the manager.
• Measures. The manager establishes appropriate targets and
yardsticks, and analyzes, appraises and interprets performance.
• Develops people. With the rise of the knowledge worker, this
task has taken on added importance. In a knowledge economy,
people are the company’s most important asset, and it is up to
the manager to develop that asset.
http://guides.wsj.com/management/developing-a-leadership-style/what-do-managers-do/
© Minder Chen, 2014
Introduction - 5
Organizations
• An organization is a social entity that has a
collective goal and is linked to an external
environment.
1. Social entity (of people)
2. Goal directed (purposeful)
3. Designed as deliberately structured and
coordinated activity/process systems
4. Linked to (and interacting with) the external
environment
“All human endeavors require organizations”
http://www.unf.edu/~gbaker/Man4201/Chapt001a.PDF
http://www.unf.edu/~gbaker/Man4201/
© Minder Chen, 2014
Introduction - 6
Five Key Areas of Effective Organizations
http://www.bridgespan.org/getattachment/099fa836-b185-4107-92b3-4a87d4590c67/The-Effective-Organization-Five-Questions-to-Trans.aspx
© Minder Chen, 2014
Introduction - 7
Universal Need for Management
“Management is everyone’s business”
• Sizes of organizations: large vs. small
• Types of organizations: For profit, Social
Enterprise, Social Business, Non-for-profit (school,
government, charity)
• Stages of organizations: Start-up, growing, and
matured
• Levels within an organizations: From top to bottom
• All business functions within an organization:
Marketing, HR, Finance, IT, Manufacturing, R&D,
etc.
© Minder Chen, 2014
Introduction - 8
What’s a Manager Anyway?
Some Alternative Definitions
• Traditional: Person who plans, directs people
and resources
• New Organization: Person who supports,
coaches, coordinates, and leads
• Peter Principle: A person promoted to their
level of incompetence
• Dilbert’s Principle: The most ineffective
workers are systematically moved where they
can do the least damage: to management
Source: MIT Prof. John Carroll (pdf)
© Minder Chen, 2014
Introduction - 9
•
•
•
•
•
•
•
•
Motives for Work
I work for money and the food, shelter, and
goods money buys.
I work for status and recognition.
I work to belong; to be part of a group.
I work to get to the top.
I work because it's only right that people
should work.
I work for knowledge and understanding.
I work for security.
I work for the feeling of accomplishment I
get from a job well done.
© Minder Chen, 2014
Introduction - 10
huMan, Market, Money, Method, Machine, Material, Message
Business environments
• Market demands
• Technology development
• Social trends
• Locations/Localization
 
Message:
Information
Man: Human Resource, Employees
Market: Customers
People
Processes
Method:
Technique, Process, Project, Task
© Minder Chen, 2014
Things
$$$
Money:
Accounting,
Finance,
Investment
Machine:
Property, Facility,
Technology
Material:
Raw
material, Product
Introduction - 11
Management
© Minder Chen, 2014
Skill Pyramid
Introduction - 12
From R. Alec Mackenzie, " The Management Process in 3-D",
Harvard Business Review, Nov-Dec 1969
© Minder Chen, 2014
Introduction - 13
The Inner Working of Management Processes
© Minder Chen, 2014
Introduction - 14
Conceptual
Skills
People Technical
Skills Skills
Management Process in 3-D
Top
Managers
Low-level
Managers
http://www.light-maker.com/harvard_whe
© Minder Chen, 2014
Introduction - 15
Ideas (Conceptual Skills)
• Forecast, Set objectives, Develop Strategies/Programs/
Budgets, Set procedure, and Develop policies
© Minder Chen, 2014
Introduction - 16
Things
Task
© Minder Chen, 2014
Introduction - 17
People
© Minder Chen, 2014
Introduction - 18
People
© Minder Chen, 2014
Introduction - 19
PM 5 Process Groups and 9 Knowledge Management Areas
© Minder Chen, 2014
Introduction - 20
Interpersonal Skills
• Effective communication: The exchange of
information.
• Influencing the organization: The ability to “get things
done”.
• Leadership: Developing a vision and strategy, and
motivating people to achieve that vision and strategy .
• Motivation: Energizing people to achieve high levels of
performance and to overcome barriers to change
• Negotiation and conflict management: Conferring with
others to come to terms with them or to reach an
agreement
• Problem solving: The combination of problem
definition, alternatives identification and analysis, and
decision-making.
© Minder Chen, 2014
21
Introduction - 21
The Deming Cycle: Continuous Quality Control
•
•
•
•
Plan (Create a project plan)
Do (Execute the project plan)
Check (Monitor & control project execution against the plan)
Action (Revise the project plan or execution)
© Minder Chen, 2014
Introduction - 22
Continuous Improvement
© Minder Chen, 2014
Introduction - 23
OODA Loop
• John Boyd purposely chose "to do" something,
rather than "to be" somebody, which he defined
as one who gives up his integrity to get ahead
in the system. He invented the OODA Loop and
is considered as the most influential military
theorist since Sun Tzu.
Source: http://www.asinc.com/images/OODA.jpg
© Minder Chen, 2014
Introduction - 24
The Business of the American People Is Business
“After all, the chief business of the American
people is business. They are profoundly
concerned with producing, buying, selling,
investing and prospering in the world. I am
strongly of the opinion that the great majority of
people will always find these the moving
impulses of our life.”
http://www.thisdayinquotes.com/2010/01/business-of-america-is-business.html
© Minder Chen, 2014
Introduction - 25
The Basic Module Map
Customer-facing channel partners
1. Develop product or
service
Business
partners
5. Collaborate
Customers
3. Fulfil demand
IT providers
© Minder Chen, 2014
2. Generate demand
4. Plan and manage the
business
Financial service providers
Introduction - 26
Process Classification Scheme: AA Global Best Practice KB
Operating processes
Understand
market &
customer
Develop vision
& strategy
Design products
& services
Market
& sell
Produce &
deliver for
product
organization
Invoice &
service
customers
Management & support
processes
Produce &
deliver for
service
organization
Develop & manage human resources
Manage information/knowledge
Manage financial & physical resources
Execute environmental management program
Manage external relationships
Manage improvement and change
Source: “A Note on Knowledge Management,” Harvard Business School 9-398-031, 1997.
© Minder Chen, 2014
Introduction - 27
Google’s Three Pitfalls of Managers
• Have trouble transitioning to the team.
• Lack a consistent approach to
performance management and career
development.
• Spend too little time managing and
communicating.
© Minder Chen, 2014
Introduction - 28
Eight Habits of Highly Effective Google Managers
By examining data from employee surveys and performance reviews,
Google’s people analytics team identified eight key behaviors
demonstrated by the company’s most effective managers:
1. Be a good coach.
2. Empower your team, and do not micromanage.
3. Express interest in team members’ personal success and
well-being.
4. Don’t be shy; be productive and results-oriented.
5. Communicate and listen to your team.
6. Help your employees with career development.
7. Express a clear vision and strategy for the team.
8. Demonstrate technical skills so you can help advise the
team.
*David A. Garvin, "How Google Sold Its Engineers on Management," Harvard Business Review, Dec 01, 2013.
© Minder Chen, 2014
Introduction - 29
The End!
Managing Innovation
Source: Video
© Minder Chen, 2014
Introduction - 31
Mastering the Building Blocks of Strategy
Source: Link
© Minder Chen, 2014
Introduction - 32
Leadership Model (NASA)
http://leadership.nasa.gov/Model/Influence.htm
© Minder Chen, 2014 http://leadership.nasa.gov/Model/Influence.pdf
Introduction - 33
A Business Architecture Map
Customer Facing Channel Partners
Customers
Business
Suppliers
2. Generate Demand
1. Develop Product / Service
5. Collaboration
3. Fulfill Demand
4. Plan &
Manage
Business
3.1. Provide Service
3.2. Advanced 3.3. Insurance
Planning
3.3.1 Sourcing and Supplier Contract Management
3.3.2 Issue Policy
Request Resources
Manage
Requisition
Approva
Processl
Communicat
e
Status
Level 4
Acquire/Purchase
3. Fulfill Demand
3.3 Insurance
3.3.2 Issue Policy
- Communicate
Status
Choose or
Default
Supplier for
Goods
Perform
Encumbrance
Check
Create
Auction Bids
Resources
Manage
Purchase
Item
Catalog
Manage
RFI/RFQ/
RFP
process
Verify/
Negotiate
Price
Purchase
Indirect
Materials
Purchase
Outside
Vendor
Services
Manage
Automatic
Replenishment
Manage
Purchasing
Methods
Consolidate
Approved
Requisitions
by Supplier
Purchase
Capital
Goods
Manage
Open to
Buy/Blanket
POs
Create
Purchase
Orders
Purchase
Direct
Materials &
Supplies
Track Open
POs
Approve
& Validate
Contract
Payments
Manage Suppliers
Manage
Supplier
Relationships
3.4. Produce
Product
Track
Supplier
Commitments
Maintain
Supplier
Catalog
Request Resources
Manage
Buyer
Performance
Communicate
Status
Provide Supplier
Self-Help
3.3.3 Receiving of Indirect / Capital Goods and Services
3.5. Logistics
Logistics Providers
© Minder Chen, 2014
Financial Service Providers
Introduction - 34
What A Process Map Doesn’t Do
Create
Certificate
Enter
Into
System
Receive Fax
Where does this
arrow come from?
What’s the context to
the rest of the business?
Is this a stable
View?
Is “Send Fax”
really a
requirement?
Rekey into FinApp
Create Policy Agreement
Send Fax
To Agent
Mail
Agreement
© Minder Chen, 2014
How is this measured?
Who Is the “customer” of this?
Are there compliance needs?
Is this core to the business?
End
Where’s the corporate
boundary and
where is the
business boundary?
Introduction - 35
What is a Capability?
Communicate Status is the capability
Rigorous schema
Beyond “how” it is implemented, there is a great
deal of other important information
Send Fax
To Agent
© Minder Chen, 2014
Metrics – how is it measured?
Cost data
Service level (like a service level agreement with outsourcing) –
how it is and how it should perform
Compliance and governance regulations
Owner
Customer
Does it directly contribute to the performance of the parent
capability, or the department or the overall organization (core
capability)
Is this capability a key part of what external organizations such
as customers think of when they do business with the
organization (identity/brand)
Etc.
Introduction - 36
"Wizard of Westwood“
UCLA
© Minder Chen, 2014
http://www.coachwooden.com/pyramidpdf.pdf
Introduction - 37
• Psychological needs that the bulk of individually
significant personality differences lies.
• Behavior = Personality x Environment
© Minder Chen, 2014
Introduction - 38
Business Model
Source: http://www.booz.com/media/uploads/Reshaping_Your_Company_Business_Model.pdf
© Minder Chen, 2014
Introduction - 39
Business Capability Mapping
© Minder Chen, 2014
Introduction - 40
http://0.tqn.com/d/management/1/0/j/B/Management-Skills-Pyramid_c.gif
© Minder Chen, 2014
Introduction - 41