Principles of Management Session 2 MBA-Health Class 2012 Assignment for June 16 All students: Read Chapters 10 and 18 All students: Submit Case Reflection #2 Group 4 : 30-min report on Organizing Comment on your organization’s Mission and Vision based on the concepts learned in class (max 2 pages) Select an organization and do a SWOT analysis (max 3 pages) All students: bring an example of team norms 15 minutes : Discuss major concepts briefly 15 minutes : Creatively present 2 companies and how they are organized Maximum 25 slides Date Management Topic Individual Assignments and cases for the session June 2 Introduction, Evolution of Management Read Chap 1,2,3, 5 and 9 The Environment and Corporate Culture, Ethics and Social Responsibility Managerial Decision-Making Read the 4 cases and prepare to discuss the questions in the book : “Elektra:, “ The Supervisor” “SIA Corp” and “Rio Grande Supply Co” Current Management Topics Read Chap 4, 6, 7 & 8 Planning , Goal Setting, Strategy formulation and Implementation Submit written case reflection 1 : “Ethical dilemna case and Application case Group 1 : Planning June 16 Organizing and Teamwork Read Chapter 10 and 18 Submit written case reflection 2: “Mission/ Vision and SWOT Analysis“ Group 2 : Organizing June 23 Dynamics of Behavior and Leadership Read Chapters 14, 15, 16, 17 Submit written case reflection 3: Group 3 : Leading June 9 Group Reports Motivation and communication June 30 July 7 MIDTERM EXAMS Coverage: Chapters 1-18 (except 11,12, 13) Change and Innovation , Meeting the challenge of diversity Read Chapters 11 and 13 Controlling Read Chapter 12, 19, 20, 21 Submit written case reflection 4: IT, HR, Operations and Value Chain July 14 July 21 Group Presentations Course Integration Submit final paper Group 4 : Controlling Cultural Sensitivity Hofstede’s Value Dimensions Power distance Uncertainty Avoidance Individualism vs. Collectivism Masculinity vs Femininity Long-term vs Short-term orientation Professor Geert Hofstede conducted one of the most comprehensive studies of how values in the workplace are influenced by culture. Power Distance The degree of inequality that exists – and is accepted – among people with and without power. A high PD score indicates that society accepts an unequal distribution of power and people understand "their place" in the system. Acknowledge a leader's power. Be aware that you may need to go to the top for answers Low PD means that power is shared and well dispersed; society members view themselves as equals. Use teamwork Involve as many people as possible in decision making. Uncertainty Avoidance Relates to the degree of anxiety society members feel when in uncertain or unknown situations. High UAI-scoring nations : try to avoid ambiguous situations ; governed by rules and order and they seek a collective "truth". Be clear and concise about your expectations and parameters. Plan and prepare, communicate often and early, provide detailed plans and focus on the tactical aspects of a job or project. Express your emotions through hands gestures and raised voices. Low UAI scores indicate the society enjoys novel events and values differences. There are very few rules and people are encouraged to discover their own truth. Do not impose rules or structure unnecessarily. Minimize your emotional response by being calm and contemplating situations before speaking. Express curiosity when you discover differences. Individualism Strength of the ties people have to others within the community A high IDV score : loose connection with people; lack of interpersonal connection and little sharing of responsibility, beyond family and perhaps a few close friends. Acknowledge accomplishments. Don't ask for too much personal information. Encourage debate and expression of own ideas. A low IDV score : strong group cohesion, large amount of loyalty and respect for members of the group. The group itself is also larger and people take more responsibility for each other's well being. Show respect for age and wisdom. Suppress feelings and emotions to work in harmony. Respect traditions and introduce change slowly. Vx Masculinity Refers to how much a society sticks with, and values, traditional male and female roles. High MAS scores : found in countries where men are expected to be tough, to be the provider, to be assertive and to be strong. If women work outside the home, they have separate professions from men. Be aware that people may expect male and female roles to be distinct. Advise men to avoid discussing emotions or making emotionally-based decisions or arguments. Low MAS scores : gender roles are simply blurred ; women and men working together equally across many professions. Men are allowed to be sensitive and women can work hard for professional success. Avoid an "old boys' club" mentality. Ensure job design and practices are not discriminatory to either gender. Treat men and women equally. Long Term Orientation (LTO) Refers to how much society values long-standing – as opposed to short term – traditions and values. Countries with a high LTO score : delivering on social obligations and avoiding "loss of face" are considered very important. Show respect for traditions. Do not display extravagance or act frivolously. Reward perseverance, loyalty, and commitment. Avoid doing anything that would cause another to "lose face". Launching a Start-up 1. 2. 3. 4. Start with an idea Write the business plan Choose a legal structure Arrange financing The Big Ideas on Planning Planning is the most fundamental of all management functions. Everything else stems from planning. Planning is the act of determining the organization’s goals and the means for achieving them. Daft Deep and Sussman Specific Specific Specific Measurable Measurable Quantitative Achievable (realistic) Challenging but realistic Challenging but achievable Relevant Covers KRA Time-bound Defined time period Linked to rewards Reflects CSF Individual-group link Participatory Goals mutually reinforcing Means and ends Self-subordinate development Put into writing Characteristics of an Effective Plan 1. Stated clearly in terms of desired results 2. Put into writing 3. Drafted by people responsible for its implementation 4. Communicated to all those affected by it 5. One person is ultimately responsible for its implementation 6. With specific date for completion, with milestone review 3 Source: Sam Deep and Lyle Sussman, “Smart Moves,” 1990 Characteristics of an Effective Plan 7. With clear criteria and how to apply the same 8. Intermediate review allowing for revisions 9. Potential problems identified and acted upon 10. Potential opportunities identified and reinforced 11. Person responsible for reporting progress identified 2 Planning for high performance Start with a strong mission and vision Set stretch goals for excellence Embrace event-driven planning Use performance dashboards Organize temporary task forces Strategic Management The art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives The set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment to achieve organizational goals. Importance of Strategic Management The PLAN allows for: A proactive approach to shaping its own future Better strategies through the use of a systematic, logical, rational approach Prioritization of opportunities and allocation of resources accordingly Objective view of management problems Framework for improved coordination and control of activities Clarification of individual responsibilities A degree of discipline and formality to the management of the business The PROCESS allows for: Enhanced communication Deeper understanding of purpose and colleagues’ views Integration of behavior of individuals into a total effort Greater commitment from employees to achieve objectives, implement strategies and work hard STRATEGIC MANAGEMENT PROCESS where we want to be EXTERNAL ENVIRONMENT GAPS --how do we get there INTERNAL ENVIRONMENT where we are today The Strategic Management Process STRATEGY FORMULATION IMPLEMENTATION MONITORING External Analysis Dev’t of Vision/ Mission Statement Establish Longterm Objective Generate Evaluate, And Select Strategies Implement Strategies: Mgt. Issues Implement Strategies: Functional Units Measure and Evaluate Performance Fred R. David Internal Analysis Strategy Formulation Strategy Implementation Strategy Evaluation Vision and Mission Vision = What we want to become Mission = What is our business? What is our reason for being? A business is not defined by its name, statutes or articles of incorporation. It is defined by the business mission. Only a clear definition of the mission and purpose of the organization makes possible clear and realistic business objectives.” - Peter Drucker A VISION is a shared image of what the people in an enterprise aspire for it to become. It conveys a desired future state. What will our business look like in 3 to 5 years from now? What new things do we intend to pursue? What future customer needs do we want to satisfy? Audacious Future-casting Does our vision statement provides a powerful picture of what our business will look like in 3 to 5 years from now? Clear and Compelling/Motivating Does Does Does Does Does it clarify the future direction the company is headed? it clarify the customer focus our company should have? it clarify the market position our company should try to occupy? is clarify the business activities our company it to pursue? is clarify the capabilities our company plans to develop? Purpose-Driven Does our vision statement give employees a larger sense of purpose? Is our vision statement worded in such a way that our employees see themselves as “building a cathedral” rather than “laying stones.” Inspiring Is our vision statement worded in engaging language that inspires and engages people? Does it create a vivid image in people’s heads that provokes emotion and excitement? Does it create enthusiasm and pose a challenge that inspires and engages people in the company? Capitalizes on Unique Competencies Does our vision statement build on our company’s core competencies? Does it build on our company history, customer base, strengths, and unique capabilities, resources and assets? The Mission “Three people were at work on a construction site. All were doing the same job, but when each was asked what his job was, the answers varied: “Laying rocks”, the first replied. “Earning a living”, responded the second. “Building a cathedral” said the third. To the extent that we see a cathedral in whatever cause we are following, the job seems more worthwhile. MISSION A MISSION states an enterprise’s fundamental reason for being and its primary commitments to its stakeholders. It guides an organization in terms of how it must do business. It usually states an enterprise’s: Primary purpose Commitments to its stakeholders Basic philosophy Core values Mission Statement Components 1) 2) 3) 4) 5) 6) 7) 8) 9) Customers Products or Services Markets Technology Concern for survival, growth and profitability Philosophy Self-concept Concern for public image Concern for employees SWOT Matrix External INTERNAL OPPORTUNITIES Characteristics of the environment that have the potential to help achieve or exceed goals THREATS Characteristics of the environment that may prevent the achievement of goals STRENGTHS WEAKNESSES Positive internal characteristics that can be exploited to achieve goals Internal characteristics that can inhibit from achieving goals How do we use our strengths to capitalize on the opportunities ? What weaknesses should be overcome to take advantage of the opportunities? How do we use our strengths to overcome the threats to the business? How do we ensure that we compensate / correct the weakness in order to manage the threat? Strategic choices Growth vs Stability vs Retrenchment Growth : Company is positioned to increase revenues in a growing market Diversification, vertical and horizontal integration Stability : Pause strategy, remain the same size/ grow slowly Retrenchment : Forced decline by shrinking current business units Liquidation Divestiture Downsizing Levels of Strategy Business-level : How do we compete? Analysis of competitive forces Competitive Strategies Differentiation Cost leadership Focus Cite examples in the ff industries 1. Hotels 2. Auto 3. Pharmaceuticals 4. Restaurant Levels of strategy Functional level : How do we support the business level strategy? Marketing Finance Sales IT HR Logistics