Instructor Solution Manual For Essentials of Contemporary Management 10e by welldoneassistant

Instructor Solution Manual For Essentials of Contemporary Management 10e By Gareth Jones and Jennifer George Chapter 1-14

Chapter 01

The Management Process Today CHAPTER CONTENTS Learning Objectives

1-2

Key Definitions/Terms

1-3

Chapter Overview

1-5

Lecture Outline

1-6

Lecture Enhancers

1-14

Management in Action

1-16

Building Management Skills

1-23

Managing Ethically

1-27

Be the Manager

1-28

Case in the News

1-29

Connect Features

1-30

PowerPoint Slides

1-31

LEARNING OBJECTIVES LO 1-1. Describe what management is, why management is important, what managers do, and how managers use organizational resources efficiently and effectively to achieve organizational goals. LO 1-2. Distinguish among planning, organizing, leading and controlling (the four principal managerial tasks), and explain how managers’ ability to handle each one affects organizational performance. LO 1-3. Differentiate among three levels of management and understand the tasks and responsibilities of managers at different levels in the organizational hierarchy. LO 1-4. Distinguish among three kinds of managerial skill, and explain why managers are divided into different departments to perform their tasks more efficiently and effectively. LO 1-5. Contrast the differences between managers, entrepreneurs, and intrapreneurs. LO 1-6. Discuss the principal challenges managers face in today’s increasingly competitive global environment.

KEY DEFINITNONS/TERMS

innovation: The process of creating new or improved goods and services or developing better ways to produce or provide them.

competitive advantage: The ability of one organization to outperform other organizations because it produces the desired goods or services more efficiently and effectively than they do. conceptual skills: The ability to analyze and diagnose a situation and to distinguish between cause and effect.

leading: Articulating a clear vision and energizing and enabling organizational members so that they understand the part they play in achieving organizational goals; one of the four principal tasks of management.

controlling: Evaluating how well an organization is achieving its goals and taking action to maintain or improve performance; one of the four principal tasks of management.

management: The planning, organizing, leading and controlling of human and other resources to achieve organizational goals efficiently and effectively.

core competency: The specific set of departmental skills, knowledge and experience that allows one organization to outperform another.

middle manager: A manager who supervises firstline managers and is responsible for finding the best way to use resources to achieve organizational goals.

department: A group of people who work together and possess similar skills or use the same knowledge, tools, or techniques to perform their jobs.

organizational performance: A measure of how efficiently and effectively a manager uses resources to satisfy customers and achieve organizational goals.

effectiveness: A measure of the appropriateness of the goals an organization is pursuing and of the degree to which the organization achieves those goals.

organizational structure: A formal system of task and reporting relationships that coordinates and motivates organizational members so they work together to achieve organizational goals.

efficiency: measure of how well or productively resources are used to achieve a goal.

organizations: Collections of people who work together and coordinate their actions to achieve a wide variety of goals or desired future outcomes.

empowerment: The expansion of employees‘ knowledge, tasks, and decision-making responsibilities.

organizing: Structuring working relationships in a way that allows organizational members to work together to achieve organizational goals; one of the four principal tasks of management.

first-line manager: A manager who is responsible for the daily supervision of non-managerial employees.

outsourcing: Contracting with another company, usually abroad, to have it perform an activity the organization previously performed itself.

global organizations: Organizations that operate and compete in more than one country.

planning: Identifying and selecting appropriate goals; one of the four principal tasks of management.

human skills: The ability to understand, alter, lead and control the behavior of other individuals and groups. 1-3

restructuring: Downsizing an organization by eliminating the jobs of large numbers of top, middle, and first-line managers and non-managerial employees. self-managed teams: A group of employees who assume responsibility for organizing, controlling and supervising their own activities and monitoring the quality of the goods and services they provide. strategy: A cluster of decisions about what goals to pursue, what actions to take and how to use resources to achieve goals. technical skills: The job-specific knowledge and techniques required to perform an organizational role. top manager: A manager who establishes organizational goals, decides how departments should interact, and monitors the performance of middle managers. top management team: A group composed of the CEO, the COO, and the vice presidents of the most important departments. turnaround management: The creation of a new vision for a struggling company based on a new approach to planning and organizing to make better use of a company‘s resources to allow it to survive and prosper.

CHAPTER OVERVIEW Chapter 1 examines what management is, including what managers do and how they use resources to achieve organizational goals. The chapter highlights the four main functions of management (planning, organizing, leading and controlling) as well as exploring the levels of management (first line, middle and top) as well as the importance of three types of managerial skills (conceptual, human and technical). The chapter concludes with a discussion of the major changes and challenges brought forth by increased globalization and advancement in information technology and competition faced by managers today.

LECTURE OUTLINE NOTE ABOUT POWERPOINT SLIDES A list of the PowerPoint slides can be found at the end of this chapter.

Management Snapshot CEO Manages for Growth at Momentive What difference can a manager make? New CEO Zander Lurie arrived at Momentive (the company formerly known as SurveyMonkey) to stabilize the company and plan a path forward for renewed growth. He had served on the board of directors, which supported then-CEO Dave Goldberg. When Goldberg died suddenly at the age of 47, the board appointed Lurie as interim CEO until a replacement for Goldberg could be found. However, within a few months, it was obvious to the board that Lurie was the best choice for permanent CEO. A big part of Lurie‘s empathetic leadership style involves listening (to customers and coworkers, with empathy). He leveraged the company‘s product, surveys, to elicit opinions of employees and customers and soon built employee surveys into corporate decision-making. The company has since addressed employee-generated issues of employee growth, diversity, and corporate responsibility. Adjusting their business model, the company now focuses on paid services (as opposed to formerly free services) and growth markets outside the United States.

I. What Is Management? LO 1-1: Describe what management is, why management is important, what managers do, and how managers utilize organizational resources efficiently and effectively to achieve organizational goals.

1. Managers operate within an organization, a collection of people who work together and coordinate their actions to achieve a wide variety of goals or desired future outcomes. 2. Management is the planning, organizing, leading and controlling of human and other resources to achieve organizational goals effectively and efficiently.

A. Achieving High Performance: A Manager’s Goal 1. Organizational performance is a measure of how effectively and efficiently a manager uses resources to satisfy customers and reach organizational goals. a. Efficiency measures how well or how productively resources are used to achieve a goal. b. Effectiveness measures the appropriateness of the goals an organization is pursuing and the degree to which the organization is achieving those goals. B. Why Study Management? 1. Managers understand the complexity of modern work, respond to environmental contingencies, and make decisions that are ethical and effective. 2. Studying management helps a person avoid the mistakes made by managers in the past. 3. Students of management have the potential to compete successfully for interesting and well-paying jobs. TEXT REFERENCE

Manager as a Person Strong Skills Make Shar Dubey a Perfect Fit for Match Sharmistha (Shar) Dubey brings determination and other skills to her position of CEO at Match Group, the owner of various popular online dating sites, including Match, OkCupid, Tinder, and Hinge. She came to the United States to earn her masters in engineering at Ohio State University, afterwards joining Texas Instruments. She moved to Match and worked there for 15 years before becoming CEO in 2020. One of her first leadership challenges was responding to the impending pandemic. The company enhanced the features on their site with videos and speed-dating games. The company continues to focus on innovation and technology trends. It also values its subscribers by refusing to sell their information to third parties. Innovation and growth has continued with the acquisition of Hyperconnect, a South Korean 1-6 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

social media company, for $1.73 billion—its largest acquisition to date. Their revenue growth has also been very positive the past few years.

II. Essential Managerial Tasks LO 1-2: Distinguish among planning, organizing, leading and controlling (the four principal managerial tasks), and explain how managers’ ability to handle each one affects organizational performance.

A. Planning 1. To perform the planning task, managers identify and select appropriate organizational goals and courses of action; they develop strategies for how to achieve high performance. 2. The three steps involved in planning are: o Deciding which goals the organization will pursue o Deciding what strategies to adopt to attain those goals o Deciding how to allocate organizational resources to pursue the strategies that attain those goals 3. The outcome of planning is a strategy, a cluster of decisions about what goals to pursue, what actions to take, and how to use resources to achieve goals.

o A low-cost strategy is a way of obtaining customers by making decisions that allow an organization to produce goods or services more cheaply than its competitors so it can charge lower prices than they do. o A differentiation strategy is a way of obtaining customers by making decisions that allow an organization to produce new, exciting, and unique goods or services. 4. Planning strategy is complex and difficult, especially because planning is done under uncertainty when the result is unknown so that either success or failure is a possible outcome of the planning process.

B. Organizing 1. Organizing is structuring working relationships in a way that allows organizational members to work together to achieve organizational goals. 2. Organizational structure is the formal system of task and reporting relationships that coordinates and motivates organizational members so they work together to achieve organizational goals.

C. Leading 1. Leading is articulating a clear vision and energizing and enabling organizational members so they understand the part they play in achieving organizational goals. 2. Leadership involves managers using their power, personality, influence, persuasion, and communication skills to coordinate people and groups so their activities and efforts are in harmony. D. Controlling 1. Controlling is evaluating how well an organization is achieving its goals and taking action to maintain or improve performance. 2. The desired outcome of the control function of management is the ability to measure performance and regulate organizational efficiency and effectiveness.

III. Levels and Skills of Managers LO 1-3: Differentiate among three levels of management and understand the tasks and responsibilities of managers at different levels in the organizational hierarchy.

A department is a group of people who work together and possess similar skills or use the same knowledge, tools, or techniques to perform their jobs. A. Levels of management 1. First-line managers: Responsible for daily supervision of non-managerial employees; also called supervisors. 2. Middle managers: Supervise the first-line managers and are responsible for finding the best way to organize human and other resources to achieve organizational goals. 3. Top managers: Responsible for the performance of all departments and ultimately responsible for the success or failure of an organization. a. The CEO, or Chief Executive Officer, is a company‘s most senior manager, the highest in the organizational hierarchy b. The COO, or the Chief Operating Officer, is a top manager who is being groomed to take over as CEO when the CEO leaves the company. c. The top management team is a group composed of the CEO, the COO, and the vice presidents most responsible for achieving organizational goals.

B. Managerial skills LO 1-4: Distinguish among three kinds of managerial skill, and explain why managers are divided into different departments to perform their tasks more efficiently and effectively.

1. Education and experience help managers acquire the three types of skills required to be a successful manager. a. Conceptual skills are demonstrated in the ability to analyze and diagnose a situation and to distinguish between cause and effect. Top managers require outstanding conceptual skills because their primary responsibilities are planning and organizing b. Human skills are the ability to understand, alter, lead and control the behavior of other individuals and groups as well as the ability to communicate, coordinate and motivate people into a cohesive team. c. Technical skills are the job-specific knowledge and techniques required to perform a particular type of work or occupation at a high level. The technical skills required by managers are dependent upon their position within the organization. 2. Core competency is a specific set of departmental skills, knowledge and experience that allows one organization to outperform its competitors. 3. Core competency gives an organization its competitive advantage, or the skill, knowledge, and experience that make an organization outperform other organizations. 4. Effective managers need all three types of skills (conceptual, human, and technical) to help their organization perform more efficiently and effectively.

IV. Managers Versus Entrepreneurs LO 1-5: Contrast the differences between managers, entrepreneurs and intrapreneurs.

A. Entrepreneurs Entrepreneurs are individuals who notice opportunities and decide how to mobilize the resources necessary to start a new business venture. Entrepreneurs make all of the planning, organizing, leading, and controlling decisions necessary to start new business ventures. 1. Characteristics of Entrepreneurs a. Entrepreneurs are likely to possess a set of personality traits including openness to experience, have an internal locus of control, high self esteem and a high need for achievement.

b. These characteristics will be discussed further in Chapter 2. 2. Entrepreneurship and Management a. Some entrepreneurs who successfully start a new business have difficulty managing it as it grows and requires day to day decisions. b. Entrepreneurship is NOT the same thing as management. Management encompasses planning, organizing, leading and controlling where entrepreneurship involves finding an unmet need and using resources to meet that need. c. Intrepreneurship is an employee working inside an organization who notices new opportunities to develop new or improved products or services and uses the organization‘s resources to create them. TEXT REFERENCE

Ethics in Action Turning Plastic Waste into Entrepreneurial Gold David Katz had a business idea that solved a problem (global plastic waste) and made money. He just needed a way to make money by getting plastic off the ground and into recycling plants. He founded Plastic Bank, which sets up collection centers run by locals and online bank accounts for collectors. When collectors bring plastic bottles to a center, it credits their Plastic Bank accounts electronically. Collectors can access the amount on their phones, using it to make mobile payments for necessities. Since Plastic Bank opened its first recycling centers in Haiti in 2015, it has improved the lives of more than 17,000 families while recovering and recycling more than 1 billion pounds of plastic waste. Plastic Bank partners with big global corporations such as S. C. Johnson that want to demonstrate their commitment to sustainability. They fund the recycling centers and commit to using more recycled plastic in their packaging. It is a win for all.

V. Challenges for Management in a Global Environment LO 1-6: Discuss the principal challenges managers face in today’s increasingly competitive global environment.

Global organizations are organizations that operate and compete in more than one country. In order to remain competitive in a global environment managers must face five major challenges: a.

building a competitive advantage

maintaining ethical standards

managing a diverse work force

utilizing new information systems and technologies

practicing global crisis management

A. Building competitive advantage 1. A competitive advantage is the ability of one organization to outperform other organizations because it produces desired goods or services more efficiently and effectively than its competitors. 2. The four building blocks of competitive advantage are superior efficiency, quality, innovation, and responsiveness to customers. a. Organizations increase efficiency when they reduce the quantity of resources (such as people and raw materials) they use to produce goods and services. b. Increased pressure by global organizations has led to a thrust to improved quality through total quality management or TQM. c. Companies can win or lose the competitive race depending on their speed and flexibility. i. Speed is how quickly an organization can bring a new product to market. ii. Flexibility is how easily an organization can change or alter the way an activity is performed in response to competition d. Innovation is the process of creating new or improved goods and services that customers want or developing better ways to produce or provide goods and services. e. Because the competition for customers is intense, the need for organizations to train employees to be responsive to the needs of their customers is vital. 3. Turnaround Management is the creation of a new vision for a struggling company using a new approach to planning and organizing to make a better use of the company‘s resources. An organization often needs turnaround management because of poor management for a continuing period or because a competitor has introduced a new product or technology that is more attractive to customers. B. Maintaining Ethical and Socially Responsible Standards 1. Pressure for a manager to increase organizational performance exists at all levels. a. Pressure can be healthy as it creates the motivation to find more effective and efficient methods to perform planning, organizing, leading and controlling. b. Too much pressure, however, can induce managers to behave unethically towards others.

2. Social responsibility centers on deciding what if any obligations a company has towards the people and groups affected by its activities such as employees, customers and its surrounding community. C. Managing a Diverse Workforce 1. The challenge for managers is to recognize the ethical need and legal requirement to treat human resources in a fair and equitable manner. 2. Today the age, gender, race, ethnicity, religion, sexual preference, and socioeconomic composition of the workforce presents new challenges for managers. 3. To create a highly trained and motivate workforce, and to avoid lawsuits, human resource management (HRM) procedures and practices that are legal and fair must be put into place. 4. Managers who value their diverse employees succeed best in promoting performance over the long run 5. Diverse human resources can be used as a competitive advantage TEXT REFERENCE

Focus on DE&I A Bold Model for Diversity in Video Games Laura Miele, whom Businessweek called ―the most powerful woman in gaming,‖ says the excitement of her career has outweighed its awkward moments. Joining a video game developer right after college, Miele had to stand up for herself and her passion for gaming. A fast learner and bold innovator, Miele made a significant impact, eventually running the company‘s marketing efforts. In 1998, Electronic Arts (EA) acquired Westwood and tasked Miele with improving decision making. Her team replaced monthly forecasts based on handmade spreadsheets with advanced analytics that could create alternative scenarios on demand. She also realigned the company‘s marketing efforts to better align with its customers and her influence grew. As a woman in gaming, she is in the minority and is supportive of women and minorities in the industry.

D. Utilizing New Technologies 1. An important challenge for managers is to continually utilize efficient and effective new technology that can link and enable managers and employees to better perform their jobs—whatever their level in the organization. 2. New technology has enabled individual employees and self-managed teams by providing them with more information and allowing for virtual interactions.

3. Technical superiority is a potential competitive advantage.

LECTURE ENHANCERS Lecture Enhancer 1.1 WHY COMPANIES FAIL CEOs often attempt to explain poor corporate performance with external environmental factors outside of their control, such as a bad economy, market turbulence, or competitive subterfuge. A close study of corporate failure, however, suggests that most companies flounder because of managerial error, according to a recent article in Fortune magazine. By failure, the article‘s authors are referring to any type of dramatic fall from grace, which may or may not result in bankruptcy. Often these failures are years in the making and are unique to the company‘s own industry and culture. Below is a list of some of the mistakes made by corporate leaders that often lead to the downfall of their organizations.

1. Softened by Success: A number of studies show that people are less likely to make optimal decisions after prolonged periods of success. NASA, Enron, Lucent, and WorldCom all had reached the mountaintop before they ran into trouble. 2. See No Evil: Author Jim Collins says that a litmus test of greatness within a company is its willingness to confront brutal facts head-on instead of trying to explain them away. Andy Grove and Gordon Moore of Intel passed this test. While watching their competitors change memory chips into a cheap commodity, they made the decision exit the chip business and enter the microprocessor business. However, Polaroid and Xerox failed. Both were slow to confront the changing world around them and face the fact that their business models were no longer sustainable. 3. Fearing the Boss More Than the Competition: Sometimes CEOs don‘t get the information they need because their subordinates are afraid to tell them the truth. Although it may not be CEOs‘ intent, sometimes a subtle signal, such as a sour expression or a curt response, can signal that bad news is not welcome. An example is Samsung Chairman Lee Kun Hee‘s 1997 decision to take the company into the automobile business. Knowing that this industry was crowded and plagued with overcapacity, many of Samsung‘s top managers silently opposed this decision but were unwilling to confront their forceful leader. Samsung Motors failed after its first year of production. 4. Listening to Wall Street more than to employees: During the late 1990‘s, Lucent‘s CEO Richard McGinn was delivering the top-line growth that Wall Street wanted, and in return, Wall Street lavished the company with attention. But as McGinn continued to 1-13 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

perform for investors, he failed to listen to his own scientists, who feared the company was missing out on an important new technology, and his own salespeople, who realized that sales targets were becoming increasingly unrealistic. 5. Strategy Du Jour: When companies run into trouble, the desire for a quick fix can become overwhelming. The frequent result is illustrated by a description of A&P by author Jim Collins. ―A&P vacillated, shifting from one strategy to another, always looking for a single stroke to quickly solve its problems. It held pep rallies, launched programs, grabbed fads, fired CEOs, hired CEOs, and hired them again.‖ Lurching from one silver bullet solution to another, the company never gained any traction. Taken from Why Companies Fail, by Ram Charan and Jerry Useem, published in the May 27, 2002 issue of Fortune magazine.

Lecture Enhancer 1.2 Why Good Employees Can Be Bad Managers You have a good employee, a hard worker, technically proficient. You promote him and it turns out to be a bad decision. You have promoted your best technical employee, and in the process, lose a good employee and gain a poor manager. How does this happen? Good technical employees can make good managers, of course, but many do not. Good technical specialists—engineers, accountants, computer gurus, financial analysts, statistical experts—are more likely to have introvert personalities. Introverts prefer to work alone. They revel in painstaking details, meaningful paperwork, tedious activities, and precision. They can focus for hours on extracting meaningful data from mounds of information. The presence of ambiguity and clutter motivates them to find the ―perfect solution.‖ The traits that make technical experts successful actually get in the way of managing others. The world of the worker encourages them to seek precision and order. By contract, the management role is messy, complicated, and ambiguous. Additionally, the sense of pride and reward for completing a task is missing. Relationship complexities are more dynamic than task complexities. Management analysis must account for distasteful political elements, egos, pride, insecurities, envy, hurt feelings, and petty conflicts. To make the successful transition to leadership, technical experts learn to rely more upon their instincts, insights, intuitions, tolerance for human equations, underlying values, and their ―feel‖ for things. Rational analysis is still important; it just is not sufficient.

MANAGEMENT IN ACTION Notes for Topics for Discussion and Action

DISCUSSION 1. Describe the difference between efficiency and effectiveness and identify real organizations you think are, or are not, efficient and/or effective. An organization‘s performance is directly tied to the levels of efficiency and effectiveness exhibited by managers within the organization. Efficiency is described as a measure of how well or productively resources are used to achieve an organizational goal. Efficiency can be increased by minimizing inputs needed to achieve desired outputs. Effectiveness is a measure of the appropriateness of the goals chosen and the degree to which they are achieved. Organizations are more effective when managers choose appropriate goals and then achieve them. 2. In what ways can managers at each of the three levels of management contribute to organizational efficiency and effectiveness? Efficiency is a measure of how well or productively resources are used to achieve a goal. First-line managers can contribute to organizational efficiency by instituting quality control procedures. Production should be monitored to ensure that the goods and services are produced without defects to prevent wasted materials, returned merchandise, and/or unsatisfied customers. The first-line manager should be very familiar with how his or her employees complete their tasks and responsibilities, meeting with them on a regular basis to discuss alternative methods that could save time and materials. Middle managers can contribute to organizational efficiency by finding ways to help first-line manager and employees better utilize resources in order to reduce manufacturing costs or improve the way services are provided to customers. They are responsible for ensuring that employees are properly trained and are equipped with the necessary skills and have access to the most efficient technology and machinery. Top managers can contribute to organizational efficiency by ensuring that departments throughout the company are cooperating with each other in the most efficient manner. It is important for them to determine if it is more economical to provide certain resources in-house (such as marketing, legal, accounting) or to outsource these functions to external agencies. Effectiveness is a measure of the appropriateness of the goals chosen and the degree to which they are achieved. First-line managers can contribute to organizational effectiveness by informing their employees of the expectations and goals that are set for them and discuss the best way to fulfill those goals and expectations. In addition, he or she might include the employees in setting appropriate goals that they both feel are obtainable. The first-line manager should periodically give feedback to his or her employees to let them know if they are on the right track in meeting preset goals and expectations. Middle managers can contribute to organizational effectiveness by evaluating whether or not the goals that an organization is pursuing are appropriate and for suggesting ways in which they could be changed. Top managers can contribute to organizational effectiveness by establishing appropriate organizational goals. They are responsible for deciding which goods and services the company should produce. In addition, they must monitor their middle managers throughout the organization to ensure that they are making the most effective use of their resources to accomplish goals. 3. Identify an organization that you believe is high performing and one you believe is low performing. Give five reasons why you think the performance levels of the two organizations differ so much. 1-15 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

(Note to instructor: Due to the nature of this question, individual answers may vary widely. Examples of factors affecting performance are listed.) Organizations that operate at different performance levels (high vs. low performing organizations) may have many different factors affecting their performance:

(1) The high-performing organization has managers who interact with and motivate employees, while the low-performing organization has managers who are aloof and do not interact with or motivate employees directly, perhaps negatively affecting morale. (2) The high-performing organization has managers who set difficult but achievable goals for their employees. A low-performing organization may not set goals, or the ones they do set are vague and difficult to attain. (3) In a high-performing organization, bonuses or rewards are directly tied to the company‘s performance. In a low-performing organization, bonuses or rewards are tied to other criteria, which may or may not include performance. (4) High-performing organization managers are able to delegate authority, and hold employees responsible for meeting organizational goals. Managers from low-performing organizations may not be able to effectively delegate authority or hold employees responsible for achieving goals. (5) Managers who solicit feedback from employees on how to manage the organization efficiently and effectively and use this information wisely will likely have a higher performing organization than managers who refuse to listen to their employees‘ suggestions for improving organizational performance. (6) Managers in high-performing organizations tend to take a ―hands-on‖ approach to management, for example, visiting a production line and learning the day-to-day operations of an organization. Managers in low-performing organizations tend to not take this approach, preferring to hear about problems or situations through indirect communication with employees. (7) High-performing organizations have managers who are able to choose appropriate goals to pursue, decide what courses of action to adopt to attain those goals, and allocate resources to attain those goals. In other words, these managers plan effectively. Low-performing organizations may have managers who lack the ability to plan effectively. (8) Managers in high-performing organizations know how to organize, or how to establish relationships within the organization that allow employees to work together toward achieving organizational goals. Managers in low-performing organizations may be ineffective in establishing these important relationships within their organization. (9) Leading involves determining direction, articulating a clear vision for employees to follow, and energizing and enabling employees so they understand the part they play in achieving organizational goals. High-performing organizations have effective leaders, while low1-16 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

performing organizations have ineffective leaders who are unable to encourage employees to perform at a high level. (10) High-performing organizations have managers who are proficient at controlling, or evaluating how well the organizations achieve their goals, and are capable of taking corrective action to maintain and improve performance. Low-performing organizations may have managers who are unable to evaluate and adapt to changing performance needs. 4. What are the key differences between managers and entrepreneurs?? Managers perform all the management functions of planning, organizing, leading and controlling, whereas entrepreneurs identify an unmet customer need and find resources to create or improve a product or service to meet that need. Entrepreneurs frequently have difficulty with handling company growth and day to day management and hire managers to ensure the organization runs smoothly. 5. In what ways do you think managers‘ jobs have changed the most over the last 10 years? Why have these changes occurred? The roles that managers have to fulfill today are quite different from the ones they have traditionally occupied. Many unique challenges face today's managers, including changes in the workforce, the environment, and organizational cultures themselves. One of the most intriguing challenges concerns the human resources in organizations. The workforce is becoming increasingly diverse in terms of age, gender, race, ethnicity, religion and socioeconomic background. Managers must find ways to treat people fairly, while at the same time effectively utilizing the different perspectives and contributions that a diversified workforce offers. Managers have been forced to comply with legislation such as the American with Disabilities Act and Affirmative Action which prevent discrimination in the workplace and encourage the hiring of employees from underrepresented groups. In addition to diversity, managers must now learn to compete on an increasingly global scale. The breakdown of barriers between formerly distinct economies has forced companies to improve performance in order to compete successfully with companies around the world. Managers can learn to keep their competitive advantage by achieving superior efficiency, increasing quality, increasing innovation, and increasing responsiveness to customers. In order to achieve these goals, managers must encourage creativity in finding new ways to use resources efficiently, empower their employees to monitor and evaluate quality, reward risk taking, and encourage employees to provide outstanding customer service. The nature of a manager‘s job has also changed in response to the shift in industry concentration of the United States from manufacturing to a more service-oriented emphasis. This has caused a modification in the nature of the work performed and mandated a greater emphasis on personal relations and leadership skills.

In addition, managers need to take advantage of the technological advances that offer opportunities to increase responsiveness to customers, improve quality, facilitate communication, and increase the rate of innovation. Organizations that can harness the power of these new technologies and information systems to increase performance will maintain a competitive advantage in an increasingly complex business environment. ACTION

6. Choose an organization such as a school or a bank; visit it; then list the different kinds of organizational resources it uses. How do managers use these resources to maintain and improve its performance? (Note to instructor: Due to the nature of this question, individual answers may vary widely. An example of a school is listed.) In order to provide the best educational environment for its students, George Washington High School makes use of a tremendous amount of organizational resources both from within and outside of the school. From within the school these resources include department heads (e.g., social studies, math, science, English, etc.) that closely manage the teachers in their department; the roster office that handles scheduling; counseling and psychological services that provide testing and guidance for students; the athletic department that provides organized and competitive sports for students to participate; the custodial and maintenance workers that handle the physical needs of the building such as cleaning, heating and repairs; secretaries that help with administration functions; the public address system for communication; computers for teaching and organizing; financial resources given to them by their school district to purchase books, supplies and equipment; and the cafeteria that provides meals for both students and teachers. G.W.H.S. also utilizes resources external to the organization, they include parents (i.e., the home and school association), the surrounding community and organizations within the community, the local police department, private organizations and businesses that provide funding, mentorship to students and internships for students. As in most cities and towns, G.W.H.S. falls under the jurisdiction of the local School District which provides personnel and other human resource services, administrative support, training, curriculum support, information technology, research, and further facilitates maintenance. The organizational resources obtained from all sources are essential to the successful operations of this school as well as any public or private institution.

7. Visit an organization and talk to first-line, middle, and top managers about their respective management roles in the organization and what they do to help the organization be efficient and effective. (Note to instructor: Due to the nature of this question, individual answers may differ widely, though students should address the following points in their answers.)

Managers at various levels within an organization have different but related types of responsibilities for utilizing organizational resources to increase efficiency and effectiveness. First-line managers have the day-to-day responsibility of supervising human resources, the employees or non-managerial employees who actually perform the activities necessary to produce goods and services. Given the knowledge of dayto-day operations that first-line managers have, they are often in good positions to make suggestions to middle managers on how processes can be made more effective and efficient. Middle managers supervise the first-line managers and have the added responsibility to find the best way to combine human and other resources to achieve organizational goals. Middle managers increase efficiency by finding ways to help first-line managers and employees better utilize resources in order to reduce manufacturing costs, or improve the way services are provided to customers. To increase effectiveness, middle managers are responsible for evaluating whether or not the goals that an organization is pursuing are appropriate and for suggesting ways in which they should be changed. Since achieving these goals efficiently is the main focus, middle managers try to find the best ways to use organizational resources. They also nurture and develop the organizational skills necessary for an organization to be efficient and effective. Top managers are at the apex of the managerial pyramid. They are responsible for supervising all the departments in an organization, and deciding how the different departments can cooperate and work together to achieve organizational goals. They are ultimately responsible for the success or failure of an organization. Top managers are responsible for establishing appropriate organizational goals and monitoring the performance of each department in achieving those goals. Most of their time is devoted to planning and organizing resources to maintain and improve efficiency and effectiveness, which determine an organization‘s long-term performance.

8. Ask a middle or top manager, perhaps someone you already know to give examples of how he or she performs the management functions of planning, organizing, leading and controlling. How much time does he or she spend in performing each task? (Note to instructor: Due to the nature of this question, individual answers may differ widely. A sample answer is given here.) Mark Jayton is a production manager at clothing manufacturing company. In our discussion he informed me that he performs all four management functions in varying degrees. He spends time at the end of each month, quarter and year planning departmental budgets, goals, and strategies for the upcoming period. Once these strategic tools are completed, he must disseminate the information to both his superiors and his subordinates. He spends time organizing on a weekly basis, when he must determine which project team should work on which production line and in what order the projects should be completed. By organizing he needs to ensure that he is using his human and material resources to their full capacity. Mark spends some time each day leading his employees. He must motivate them to produce quality work and listen to their concerns and problems on a regular basis. Mark performs the controlling function on a constant basis as he monitors the performance of his department at all levels so that he is able to be proactive in dealing with any issues or problems that could arise.

9. Try to find a cooperative manager who will allow you to follow him or her around for a day. List the roles the manager plays and how much time he or she spends performing them. Peter Johnson is a manager of a real-estate office. Performing this job requires Peter to perform many of Mintzberg‘s roles that encompass the managerial functions of planning, organizing, leading and controlling organizational resources. Peter acts as a figurehead; a person who symbolizes an organization and what it is seeking to achieve. He establishes for his field agents the appropriate ways to behave in an organization with his professional manner and enthusiasm. This role requires constant attention, and is exhibited in his personality and mannerisms. Much of Peter‘s time is devoted to acting as a leader for his employees, motivating his employees to perform at a higher level by training, counseling, and mentoring them. Another main part of Peter‘s job is in the liaison role, linking and coordinating activities of people and groups both inside and outside the organization. Disseminating information is also an integral part of Peter‘s job. By acting as a monitor, Peter analyzes information to effectively organize and control resources, while his role as a disseminator involves sharing this information with his employees to influence their work and behavior. Finally, Peter does play some decisional roles within his organization, working as a resource allocator who decides how to allocate people and other resources, and a negotiator, who manages solutions between groups with competing interests. AACSB: Analytic AACSB: Reflective Thinking

BUILDING MANAGEMENT SKILLS Thinking about Managers and Management (Note to instructor: Due to the nature of these questions, student responses may vary. The following are examples.) 1. Think of your direct supervisor. Of what department is he or she a member and at what level of management is this person? Jonathon Lewis is an audit manager at a large accounting firm. His position is considered middlemanagement since he reports to the partners of the firm but is responsible for managing the supervisors who closely monitor the staff associates on a day-to-day basis. 2. How would you characterize your supervisor‘s approach to management? For example, which particular management tasks and roles does this person perform most often? What kinds of management skills does the manager have?

Jonathon performs the four functions of management to different degrees. He is involved in planning when he determines strategies for soliciting customers and recruiting new employees. 1-20 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

He also determines which of his supervisors and staff associates would be best suited to work with certain clients. He needs to allocate his staff appropriately so that all of his client needs are met in a timely manner. Jonathon performs the organizing function by choosing team members who will work together to achieve the goals that he has set forth for them. He needs to coordinate the efforts of the support staff, such as the tax department, whose services are essential in completing the project. When beginning a new project, Jonathon exercises his leadership skills by holding meetings with his entire staff to communicate his goals for the project and delegating responsibilities to appropriate team members. His confident nature coupled with his accounting expertise motivates his team to enthusiastically tackle the challenges that he sets forth for them. He continues to control the project by holding weekly meetings with his team to assess the progress and provide the necessary feedback. He reviews the work that they have completed and makes recommendations for any necessary changes. At this point he determines whether his team is on schedule with the budget and if necessary how they can better manage their time. Jonathon performs many of the interpersonal, informational and decisional roles coined by Mintzberg. Within the interpersonal roles he is required to act as a figurehead, leader and liaison among and between his team members. He performs informational roles by monitoring technical and client-specific information, disseminating the necessary information to his clients and staff, and acting as a spokesperson when he represents the firm at many meetings, presentations and recruiting events. While performing decisional roles he must act as an entrepreneur in determining what lines of business are best to solicit, a disturbance handler when any unforeseen events effect the progress of his team, a resource allocator in determining which employee should work on which project, and a negotiator when he must negotiate with other managers when there is a scheduling conflict involving his team members. Jonathon possesses tremendous technical and human skills. His technical skills include his everincreasing accounting expertise as well as his up-to-date knowledge of the issues facing his clients and their industry. He exercises his human skills every time he interacts with supervisors, staff associates, partners, support staff and clients. 3. Are the tasks, roles, and skills of your supervisor appropriate for the particular job he or she performs? How could this manager improve his or her task performance? How can technology affect this? Jonathon possesses the functions, roles and skills that are necessary for him to effectively manage his project teams while satisfying the customer and soliciting new business on a regular basis. However, he could work on his conceptual skills. At times he has trouble seeing the big picture when it comes to managing the careers of his employees. He is very good at ensuring that he has the best people on his team and that they are equipped with the technical skills needed for that project, but is lacking when it comes to the development needed for them to progress to the next level. He has a habit of handling the more technically difficult aspects of the project himself, instead of involving team members so that they will become more proficient in those areas.

Clearly, Jonathan needs to do a better job of empowering his employees. He should consider delegating additional technical tasks to teams of employees, serving as their coach instead of providing direct supervision, and using IT to monitor the progress of those teams. 4. How did your supervisor‘s approach to management affect your attitudes and behavior? For example, how well did you perform as a subordinate and how motivated were you? As a result of the functions he performed, the skills he possessed and the roles he fulfilled, I found that Jonathon‘s management style had a positive effect on my attitudes and my work performance. I was very motivated to provide top quality work and eager to please a well-respected figurehead in my organization. To make up for any deficiency in Jonathon‘s conceptual skills of ―seeing the big picture,‖ I found myself feeling more responsible for my future growth and development. This did not prevent me from performing to my full potential, it merely meant that I needed to spend my own time and energy to ensure that I gained the additional skills and knowledge that I did not learn while working on Jonathon‘s projects. 5. Think about the organization and its resources. Do its managers utilize organizational resources effectively? Which resources contribute most to the organization‘s performance? Being a service-oriented organization made it necessary to ensure that organizational resources were utilized most effectively and efficiently. In a service organization the ―human‖ resources are the most valuable resources that the company possesses. The accounting firm has an entire department devoted to the scheduling functions of employees to project teams in response to managers‘ requests. In addition, they have an in-house educational department that spends a great deal of time and money on employee training and development. 6. Describe the way the organization treats its human resources. How does this treatment affect the attitudes and behaviors of the workforce? To a great extent this accounting firm values its most precious resource, its employees. They organize social functions on a regular basis during the busiest times of the year to reward employees for hard work and provide some relaxation. In addition, employees are rewarded monetarily for overtime worked and receive bonuses annually which are based on performance. Problems do arise when managers are extremely demanding of their project teams and require them to meet unreasonable budgets. As a result, employees feel that their personal obligations and needs are neglected. Fortunately, the human resource department monitors the hours worked by all employees and consults with managers when their teams are working an exorbitant number of hours. In response to the professional nature of the firm and the high regard given to employees most of the time, a large percentage of employees are extremely motivated and self-driven. 7. If you could give your manager one piece of advice or change one management practice in the organization, what would it be?

I would suggest to Jonathon that he take a more proactive role in the management of his subordinate‘s careers. By looking at the ―big picture‖ he can help them to develop, which would enable smoother transitions as their careers progressed. If he would include subordinates in the more difficult tasks of the project they could benefit tremendously while gaining the experience and exposure necessary to enter the future ranks of management. 8. How attuned is the organization to the need to increase efficiency, quality, innovation, or responsiveness to customers? How well do you think the organization performs its prime goals of providing the goods or services that customers want or need the most? The managers at this accounting firm are constantly faced with pressure from upper management to increase efficiency while increasing the quality of the services rendered. Since time budgets are extremely important and used as a measurement of success, actual hours spent are measured against budgeted hours on a regular basis. Managers are open to suggestions from supervisors and staff associates about how to provide the same service in a timelier fashion, as long as the intended purpose is served and quality is not compromised. Managers are responsible for reviewing the work performed by their project teams and require that errors and omissions are attended to on a timely basis. In a service-oriented environment it is essential that the organization be responsive to customer needs. Therefore, any successful manager is constantly in touch with his or her clients and keeps abreast of any issue that will affect his or her client‘s financial or economic health. AACSB: Reflective Thinking AACSB: Analytic

MANAGING ETHICALLY Think about an example of unethical behavior that you observed in the past. The incident could be something you experienced as an employee or a customer or something you observed informally. 1. Either by yourself or in a group, give three reasons why you think the behavior was unethical. For example, what rules or norms were broken? Who benefited or was harmed by what took place? What was the outcome for the people involved? Responses to this set of questions will differ, based upon the varying experiences of students. Examples of unethical behavior might include observing an employee intentionally mislead customers to generate sales, padding expense accounts, falsifying credentials on a resume, or accepting expensive gifts from suppliers eager to improve business relationships with their client. Dishonesty is unacceptable regardless of the circumstance. Employees should be careful to avoid conflicts of interest that may cause others to question their integrity. Although those involved in such unethical situations may perhaps benefit in the short run, in the long run they harm not only their customers and their companies, but also themselves.

2. What steps might a manager take to prevent such unethical behavior and encourage people to behave in an ethical way? Establishing an organizational code of ethics and making all employees aware of it can encourage ethical behavior. It is also important that managers always engage in ethical conduct, so that they can lead by example. AACSB: Ethics AACSB: Reflective Thinking

BE THE MANAGER Questions: 1. What kinds of organizing and controlling problems is Achieva suffering from? It is very common when a company starts out to be very informal. Everyone is excited by the new venture and in this case, its success. But the founders must now deal with the enormous growth and develop what they want as a culture; they need to take their roles seriously. They must take a look at the requirements for planning, organizing, leading and controlling the organization; they should assign managerial and technical roles to employees; and they need to develop an equitable performance appraisal and reward system for all employees. It also sounds like they must to look at their Human Resources function more closely as they are growing so fast and want to be sure to bring the right people on board. 2. What kinds of management changes need to be made to solve them? The founders should recognize that management of the firm is now essential by developing some sort of organizational chart, assign all those with managerial roles either a title or some acknowledgement of their duties and responsibilities, and let everyone know how they are to interact and coordinate to continue to be successful. AACSB: Analytic AACSB: Reflective Thinking

CASE IN THE NEWS Case Synopsis: Larry Culp Redefines Success at GE Corporate giant GE was thriving in businesses as diverse as jet engines, entertainment, power generation, and consumer finance until the financial crisis of 2008, when excessive risk in the financial-services division nearly caused the company to collapse under the weight of its debt. Ten years and two CEOs later, Larry Culp joined GE. At that time, the company was still struggling to remain relevant. 1-24 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Immediately after his arrival, Culp assessed each segment of the company and, using his experience in cutting costs and improving processes, started making changes. Culp pulled GE completely out of consumer-facing businesses such as appliances and home mortgages and left the company with four main businesses—aviation, healthcare (hospital equipment), renewable energy (wind turbines), and power (equipment for fossil-fuel power generation). In 2021, culp split GE into three parts: healthcare, power (fossil-fuel and renewables), and aviation. At the time of the announcement, the plan was to spin off GE‘S strongest division, healthcare, in early 2023. In the meantime, it would combine its fossil-fuel power unit with its renewable-energy unit to create one power unit, aiming to sell in 2024. With those deals complete, GE would retain the aviation unit and try to maintain its leadership position.

Questions 1. List three examples of Larry Culp using organizational resources to achieve organizational goals. First, Culp used organizational resources to conduct an in-depth investigation of the organization. Second, he upgraded machinery and improved processes at a turbine plant. Third, he decentralized support services such as IT and HR to the divisions, making them stand-alone profit centers. 2. What is something Culp planned? What is an organizational change he made? When was he engaged in controlling? How would effective leadership help him carry out these tasks?

He planned his initial investigation of the divisions, cutting costs, selling divisions and cutting dividends. Organizational changes included decentralizing costs (i.e., IT, HR) and selling divisions. Throughout the changes, he used leadership to convince employees, the board and investors of the soundness of his approach. 3. At GE, Larry Culp is a top manager. How would the work of a middle manager at GE differ from Culp‘s work?

Top managers determine strategy and direction, middle managers implement them. AACSB: Analytic AACSB: Reflective Thinking

CONNECT For more information and instructions for Connect, visit https://www.mheducation.com/highered/connect

Case Analysis  

The Outsider at Ford Safety at BP

Manager’s Hot Seat (MHS)  

Fumbling Management Theory Management Hits Rough Waters

iSeeIt! Animated Video 

History of Management

Worksheets 

Essential Managerial Tasks (Click and Drag)

Self-Assessments (See Application-Based Activities within Connect) There is no recommended self-assessment for Chapter 1.

POWERPOINT SLIDES These Instructor‘s PowerPoint slides can be used to supplement the lecture material. SLIDE 1 Chapter Title SLIDE 2 Learning Objectives SLIDE 3 What Is Management? Organizations SLIDE 4 What Is Management? Management SLIDE 5 What Is Management? Managers and Resources SLIDE 6 Achieving High Performance SLIDE 7 Organizational Performance SLIDE 8 Figure 1.1: Efficiency, Effectiveness, and Performance in an Organization SLIDE 9 Why Study Management? SLIDE 10 Four Tasks of Management (Figure 1.2) SLIDE 11 Planning SLIDE 12 Steps in the Planning Process SLIDE 13 Organizing SLIDE 14 Leading SLIDE 15 Controlling SLIDE 16: Topics FOR Discussion: Efficiency And Effectiveness SLIDE 17 Performing Managerial Tasks SLIDE 18 Managerial Roles Identified by Mintzberg

Chapter 02 Values, Attitudes, Emotions, and Culture: The Manager as a Person

SLIDE 19 Levels of Managers SLIDE 20 Levels Managers: Figure 1.3 SLIDE 21 Top Management Team SLIDE 22 Relative Amount of Time That Managers Spend on the Four Managerial Tasks SLIDE 23 Topics of Discussion: Organizational Performance SLIDE 24 Types of Managerial Skills SLIDE 25 Topics of Discussion: Organizational Performance SLIDE 26 Core Competency SLIDE 27 Types and Levels of Managers SLIDE 28 Managers Versus Entrepreneurs SLIDE 29 Entrepreneurship SLIDE 30 Challenges for Management in a Global Environment SLIDE 31 Building Competitive Advantage SLIDE 32 Building Blocks of Competitive Advantage SLIDE 33 Innovation SLIDE 34 Turnaround Management SLIDE 35 Maintaining Ethical and Socially Responsible Standards SLIDE 36 Managing a Diverse Workforce SLIDE 37 Utilizing New Technologies SLIDE 38 Be the Manager SLIDE 39 Topics for Discussion: Challenges for Managers

Chapter 02 Values, Attitudes, Emotions, and Culture: The Manager as a Person

Chapter 02 Values, Attitudes, Emotions, and Culture: The Manager as a Person CHAPTER CONTENTS

Learning Objectives

2-2

Key Definitions/Terms

2-3

Chapter Overview

2-4

Lecture Outline

2-5

Lecture Enhancers

2-11

Management in Action

2-14

Building Management Skills

2-18

Managing Ethically

2-19

Be the Manager

2-20

Case in the News

2-21

In-Class Activity

2-23

Connect

2-24

PowerPoint Slides

2-25

Chapter 02 Values, Attitudes, Emotions, and Culture: The Manager as a Person

LEARNING OBJECTIVES

LO 2-1.

Describe the various personality traits that affect how managers think, feel, and behave.

LO 2-2.

Explain what values and attitudes are, and describe their impact on managerial action.

LO 2-3.

Appreciate how moods and emotions influence all members of an organization.

LO 2-4.

Describe the nature of emotional intelligence and its role in management.

LO 2-5.

Define organizational culture, and explain how mangers both create and are influenced by organizational culture

Chapter 02 Values, Attitudes, Emotions, and Culture: The Manager as a Person

KEY DEFINITIONS/TERMS

negative affectivity: The tendency to experience negative emotions and moods, to feel distressed, and to be critical of oneself and others

agreeableness: The tendency to get along well with other people

norms: Unwritten, informal codes of conduct that prescribe how people should act in particular situations and are considered important by most members of a group or organization

attitude: A collection of feelings and beliefs attraction-selection-attrition (ASA) framework: A model that explains how personality may influence organizational culture

openness to experience: The tendency to be original, have broad interests, be open to a wide range of stimuli, be daring, and take risks

conscientiousness: The tendency to be careful, scrupulous, and persevering

organizational citizenship behaviors (OCBs): Behaviors that are not required of organizational members but that contribute to and are necessary for organizational efficiency, effectiveness, and competitive advantage

emotional intelligence: The ability to understand and manage one‘s own moods and emotions and the moods and emotions of other people emotions: Intense, relatively short-lived feelings external locus of control: The tendency to locate responsibility for one‘s fate in outside forces and to believe that one‘s own behavior has little impact on outcomes

organizational commitment: The collection of feelings and beliefs that managers have about their organization as a whole organizational culture: The shared set of beliefs, expectations, values, norms, and work routines that influence how individuals, groups, and teams interact with one another and cooperate to achieve organizational goals

extraversion: The tendency for individuals to be outgoing, sociable, and energetic in their behavior. instrumental value: A mode of conduct that an individual seeks to follow internal locus of control: The tendency to locate responsibility for one‘s fate within oneself

organizational socialization: The process by which newcomers learn an organization‘s values and norms and acquire the work behaviors necessary to perform jobs effectively

job satisfaction: The collection of feelings and beliefs that managers have about their current jobs

personality traits: Enduring tendencies to feel, think, and act in certain ways

mood: A feeling or state of mind need for achievement: The extent to which an individual has a strong desire to perform challenging tasks well and to meet personal standards for excellence

self-esteem: The degree to which individuals feel good about themselves and their capabilities terminal value: A lifelong goal or objective that an individual seeks to achieve

need for affiliation: The extent to which an individual is concerned about establishing and maintaining good interpersonal relations, being liked, and having other people get along

value system: The terminal and instrumental values that are guiding principles in an individual‘s life

need for power: The extent to which an individual desires to control or influence others

Chapter 03 Managing Ethics and Diversity

CHAPTER OVERVIEW This chapter focuses upon the manager as a feeling, thinking human being. We start by describing enduring personality characteristics that influence how managers ‗manage,‖ as well as how they view other people, their organizations, and the world around them. We discuss as well how managers‘ values, attitudes, and moods play out in organizations, shaping organizational culture. This chapter provides a strong appreciation of how the personal characteristics of managers influence the process of management in general, and organizational culture in particular.

Chapter 03 Managing Ethics and Diversity

LECTURE OUTLINE NOTE ABOUT POWERPOINT SLIDES Please see the list at the end of this chapter for titles of all the Chapter 2 PowerPoint slides. The PowerPoints include alternate text for unsighted students, describing the images contained in the slides.

Management Snapshot John Hancock CEO Ensures a Bright Future What Qualities Does a Successful Manager Posses? Marianne Harrison, CEO of John Hancock, shapes the values of her organization by showing concern for others, fostering diverse ideas, and demonstrating a willingness to step outside her comfort zone. Starting her career as an accountant, Harrison discovered early on the importance of speaking up for herself. She learned this lesson when she told her then-boss that she would like the chance to work with the company‘s highest profile client and he expressed surprise that she would be willing to relocate with three small children and a self-employed husband. Switching from accounting to banking and insurance, Harrison continued to seek challenges and credits her success to doing her best in every position she has held. Making the jump to John Hancock, she relocated her family from Toronto to Boston so she could run the entire long-term care insurance business for the company. Harrison values the input of others and regularly hires and listens to a diverse group of employees. Her emphasis on customer empathy extended to having her entire salesforce answering customer calls for a month. She looks for opportunities to improve customers‘ lives rather than simply create and sell products. I. Enduring Characteristics: Personality Traits

LO 2-1: Describe the various personality traits that affect how managers think, feel, and behave. Personality traits are enduring tendencies to feel, think, and act in certain ways. It is important to understand the personalities of managers because their personalities influence their behavior and their approach to managing people and resources.

A. The Big Five Personality Traits The Big Five is a group of five general traits that contribute to the composition of an individual‘s personality. Each should be evaluated along a continuum. 1. Extraversion is the tendency for individuals to be outgoing, sociable, and energetic in

their behavior. Managers who are high on the extraversion continuum (often called extroverts) tend to be friendly and enjoy social interactions. Managers who are low on the

Chapter 03 Managing Ethics and Diversity

extraversion continuum (often called introverts) tend to be less inclined toward social interactions and prefer to spend more time alone. 2. Negative Affectivity is the tendency to experience negative emotions and moods, feel

distressed, and be critical of others. Managers high on this trait may often feel angry and dissatisfied and complain about their own and others‘ lack of progress. Those who are low on negative affectivity do not tend to experience as many negative emotions and are less pessimistic and critical of themselves and others. 3. Agreeableness is the tendency to get along well with others. Managers high on this

continuum are likeable, tend to be affectionate, and care about other people. Those who are low may be somewhat distrustful of others, unsympathetic, uncooperative, and even at times antagonistic. See Figure 2.2 for a measure of this. 4. Conscientiousness is the tendency to be careful, scrupulous, and persevering.

Managers who are high on this factor are organized and self-disciplined while those who are low may seem to lack self-direction and self-discipline. 5. Openness to experience is the tendency to be original, have broad interests, be open to

a wide range of stimuli, be daring, and take risks. Those high on this trait continuum like to take risks and sometimes choose to become an entrepreneur, while those low on this scale tend to be more conservative in their planning and decision-making. B. Other Personality Traits that Affect Managerial Behavior 1. The locus of control trait captures an individual‘s beliefs concerning the amount of control they have over what happens to and around them. a. People with an internal locus of control believe that they are responsible for their own fate and see their own actions and behaviors as being important and decisive determinants of future outcomes. b. People with an external locus of control believe that outside forces are responsible for what happens to and around them and that their own actions don‘t make much of a difference. 2. Self-esteem is the degree to which individuals feel good about themselves and their capabilities. 3. Needs for achievement, affiliation and power have been extensively researched by psychologist David McClelland. a. The need for achievement is the extent to which an individual has a strong desire to perform challenging tasks well and to meet personal standards for excellence. b. The need for affiliation is the extent to which an individual is concerned about establishing and maintaining good interpersonal relations, being liked, and getting along with other people. c. The need for power is the extent to which an individual desires to control or influence others.

Chapter 03 Managing Ethics and Diversity

II. Values, Attitudes, and Moods and Emotions LO 2-2: Explain what values and attitudes are, and describe their impact on managerial action. A. Values: Terminal and Instrumental 1. A terminal value is a personal conviction about lifelong goals or objectives while an

instrumental value is a personal conviction about desired modes of conduct or ways of behaving. 2. Terminal values often lead to the formation of norms, which are informal rules of

conduct for behaviors considered to be important within an organization. 3. A leading researcher identified 18 terminal values and 18 instrumental values that

when placed in rank order, will describe a person‘s value system.

B. Attitudes An attitude is a collection of feelings and beliefs. A manager‘s attitude affects how they approach their job. Two of the most important attitudes in this context are: 1.Job Satisfaction is the collection of feelings and beliefs that managers have about their current job. See Figure 2.3 for a sample of items from two measures of job satisfaction. a. Managers who are satisfied with their jobs are more likely to perform organizational citizenship behaviors (OCBs). OCBs are behaviors that are not required but contribute to organizational efficiency, effectiveness, and gaining a competitive advantage. b. A growing source of dissatisfaction for many lower- and middle-level managers and employees is the threat of unemployment and increased workloads from downsizing. c. The ways in which layoffs are handled is important for both layoff victims and survivors. 2. Organizational commitment is the collection of feelings and beliefs that managers have about their organization as a whole. With organizational commitment, managers: a. Believe in what their organizations are doing b. Are proud of what the organization stands for c. Feel a high degree of loyalty toward their organizations. C. Moods and Emotions LO 2-3: Appreciate how moods and emotions influence all members of an organization

Chapter 03 Managing Ethics and Diversity

1. Mood: A mood is a feeling or state of mind. Personality traits and current circumstances often determine a person‘s mood. See Figure 2.4 for a measure of positive and negative mood at work 2. Emotions: Emotions are more intense than moods, are more short-lived, and are usually linked to a specific cause.

III. Emotional Intelligence (EI) LO 2-4: Describe the nature of emotional intelligence and its role in management Emotional Intelligence is the ability to understand and manage one‘s own moods and emotions, as well as the moods and emotions of others.

1.Managers with high levels of EI are able to prevent their emotions from getting in the way of making effective decisions. 2.EI helps managers perform the interpersonal roles of figurehead, leader, and liaison. 3.Emotional intelligence helps managers understand and relate well to other people. TEXT REFERENCE

Managing Globally Emotional Intelligence across Borders Outward displays of enthusiasm are expected and valued in the U.S. culture, but those displays may be very out of place in the cultures of Britain and China, for example. British businesspeople tend to play down their emotions and Chinese workers see enthusiasm as a way of showing off rather than fitting in. Smiling is another example of behavior that is interpreted differently in different cultures. While expected in the United States, smiling is less common in northern Europe and seen as a way to cover up embarrassment or unhappiness in Japan. These variations demonstrate that although all cultures share the same feelings, they express them differently, which can lead to misinterpretation and confusion. Recognition of cultural differences in the expression of emotions is a good start to developing global emotional intelligence.

Chapter 03 Managing Ethics and Diversity

IV. Organizational Culture LO 2-5: Define organizational culture, and explain how mangers both create and are influenced by organizational culture Organizational culture describes the set of beliefs, expectations, values, norms, and work routines that influence how members of an organization relate to one another and work together to achieve organizational goals.

1. When members share an intense commitment to goals, a strong organizational culture exists. When the opposite is true, the organization‘s culture is weak 2. When an organization‘s culture is very strong, it is often referred to as the organization‘s ‗personality‘ because it influences the way its members behave. A. Managers and Organizational Culture 1. Managers play a particularly important part in influencing organizational culture. This is most evident in the start-up of new companies 2. Management researcher Benjamin Schneider developed a model called the attraction-selection-attrition (ASA) framework, which posits that entrepreneurs tend to hire employees whose personalities are similar to their own. B. The Role of Values and Norms in Organizational Culture Shared values, as well as shared norms, play a particularly important role in organizational culture. Terminal values signify what an organization and its employees are trying to accomplish, and instrumental values guide how the organization and its members achieve organizational goals.

1.Values of the founder: From the ASA model previously discussed, it is clear that founders can have a profound and long-lasting effect on organizational culture. 2.Organizational Socialization: This is the process by which newcomers learn an organization‘s values and norms and acquire the work behaviors necessary to perform jobs effectively. As a result, organizational values and norms are internalized. 3.Ceremonies and rites: These are formal events that recognize incidents of importance to the organization as a whole and to specific employees. The most common rites that organizations use to transmit cultural norms and values to their members are rites of passage, of integration, and of enhancement. (See Table 2.1 for examples of the rites listed below.) a. Rites of passage determine how individuals enter, advance within, or leave an organization. b. Rites of integration build and reinforce common bonds among organizational members c. Rites of enhancement let organizations publicly recognize and reward employee contributions and thus strengthen their commitment to organizational values. 3-36 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Chapter 03 Managing Ethics and Diversity

4. Stories and language: Stories frequently told within an organization, either fact or fiction, provide important clues about values and norms. The slang or jargon that people within an organization use to frame and describe events also provides important clues about norms and values. C. Culture and Managerial Action Culture influences the way in which managers perform their four main functions.

1.Planning: In an innovative organizational culture, top managers are likely to develop a flexible approach to planning and to encourage participation by subordinates. In contrast, managers in a conservative organizational culture are likely to emphasize topdown planning. 2.Organizing: Because they value creativity, managers in an innovative culture are likely to create an organic structure that is flat and in which authority is decentralized. In contrast, managers in a conservative culture are likely to create a well-defined hierarchy of authority and establish clear reporting relationships. 3.Leading: In an innovative culture, managers are likely to lead by example, encourage employees to take risks and experiment, and to be supportive regardless of success or failure. In a conservative culture, they are likely to use management by objectives, constantly monitor progress toward goals, and oversee their every move. 4.Controlling: Managers in innovative cultures tend to recognize that there are multiple, potential paths to success and that failure must be accepted in order for creativity to thrive. Therefore, they are more concerned that employees be flexible and take risks and less concerned about their adherence to pre-determined routines and goals. In contrast, managers in more conservative cultures emphasize caution and maintenance of the status quo.

Chapter 03 Managing Ethics and Diversity

LECTURE ENHANCERS

Lecture Enhancer 2.1 DANIEL GOLEMAN AND EMOTIONAL INTELLIGENCE

For eight years, Daniel Goleman has argued persuasively that emotionally intelligent managers become the best and most profitable business leaders in the world. Beginning with his 1995 bestseller Emotional Intelligence, Goleman has sought to strip away conventional notions of what it means to be intelligent by examining how key personality traits can lead to measurable success. Although his background is in psychology, he has become a powerful voice in the corporate world. It is Goleman‘s contention that top leaders will recognize that they cannot function without a clear understanding of their own feelings and those of the people around them. ―Emotions have their place, and your emotions have an enormous impact on how well you can do the task at hand,‖ he says. Below are excerpts from an interview with Dr. Goleman.

Industry observers often complain about the dichotomy in the business world today. Executives are expected to behave as if they have no emotions while they make decisions that will have profound effects on other people‘s lives. What do you think has brought us to this state where businesspeople are supposed to ‗check their emotions at the door‘? Goleman: The first analysis of the organizational life was conducted in a sociological tradition by Max Weber and Talcott Parsons, and it pretty much ignored to emotional reality of work. It analyzed the workplace and organizational dynamics as though emotions were not part of the equation. That framework has survived to this day, even though everyone who works knows it‘s a lie. We don‘t leave emotions at home and we don‘t check them at the door. We can either acknowledge this fact or not. You maintain that companies perform better if top managers have emotional intelligence, but the business world is rife with stories of CEOs and top managers who have been wildly successful even though they are insensitive jerks. If emotional intelligence is so important, how do you account for their successes? Goleman: The question to ask is not, ―Is a specific company successful despite the fact that the head guy is a jerk?‖ Rather, you should ask, ―If all things were equal – if there were two companies with similar markets, similar opportunities, and similar resources, and one boss was a jerk and the other was a dream boss – which company would do better? In fact, the insurance industry did exactly that study. It was commissioned by LOMA, an insurance industry organization, and carried out by the Hay Group. The researchers looked at moderately successful companies of the same size and evaluated CEOs on their emotional intelligence and leadership abilities. They found that the more these bosses exhibited empathy, initiative, and a drive to achieve, the more profitable the companies were. That‘s the better way to answer this question.

Chapter 03 Managing Ethics and Diversity

Is it there ever a point at which someone is too old to learn these competencies? Goleman: You are never too old to learn emotional intelligence. In fact, people tend to improve in emotional intelligence over the course of a lifetime, because life lessons often make people wiser in this domain. Thy get more comfortable with themselves and other people. So in a rough way, a slow way, there‘s a tendency to learn. But someone who wants to be a leader needs to have a relatively high level of these abilities. A business school that wants to help its students achieve high leadership levels either has to select people who have already developed these abilities, or it has to help its students to learn them. Essentially, you are saying that individuals must be able to draw on the so-called ‗soft skills‘ or they won‘t be good leaders. Goleman: It‘s a paradox. Soft skills have hard consequences. Taken from Intelligence at Work by Sharon Shinn, published in BizEd Magazine, September/October 2003.

Lecture Enhancer 2.2 BIRTH ORDER AND PERSONALITY

Birth-order guru Kevin Leman, Ph.D. says he can explain how a simple understanding of birth order enhances the chance of success in business. In his book, The Birth Order Book, Leman profiles three birth-order positions. The firstborn tends to be a perfectionist, conscientious, list maker who doesn‘t like surprises. The only child has similar, yet often more intense personality traits. The middle child is a master negotiator who never had his parents to himself, and endured hand-medowns. The good news is he can compromise, share, and negotiate. Leman describes the baby of the family as manipulative, social, outgoing, and a natural salesperson. She is the child who got her siblings in trouble while she was cute, helpless, and got away with murder. A fourth birth-order position, identified by Michael Maniacci, a clinical psychologist and member of the faculty at the Adler School of Professional Psychology in Chicago, is the second born. The second born tends to be more rebellious, non-conforming and independent than the middle child. After reading these descriptions, most either buy into the birth-order concept as a perfect description of their family or discount it. Either way, Leman says, there are other birth-order rules that impact children‘s development.

Chapter 03 Managing Ethics and Diversity

Sex of children is an important variable in the birth-order equation. ―If there are three daughters and a last-born son, the son may possess the characteristics of the firstborn, rather than the baby,‖ Leman says. Maniacci says: ―In my practice, I‘ve found the greater the sex differentiation between the parents, the less children of the opposite sex compete with each other. That impacts birth-order roles.‖ ―In a family with a firstborn boy and a second born girl, if both parents work, both wear pants, and equally share housework tasks, the girl is more likely to be a rebellious second born. There is not much distinction between being a girl and a boy. Conversely, if Dad has short hair and Mom has long, and Mom stays at home and Dad works, the boy holds the role of the oldest born male and the girl the oldest born female.‖ ―If there is a five-year age gap between the children, you can draw a line and start another family with a whole new set of firstborns and middles,‖ Maniacci says. Physical differences play a role too. If the oldest child is physically or psychologically challenged, the second child usually takes on the role of the firstborn. Other experts caution that understanding and using birth order is anything but simple, and many variables mold personality. Experts generally agree interpreting birth order can be complicated and only presents part of the picture. But Leman says, ―As a psychologist, I have not found a more practical tool for understanding human dynamics than birth order.‖

Lecture Enhancer 2.3 THE BIG THRILL PERSONALITY Another facet of personality is one‘s tolerance for risk taking. Some individuals have a kind of psychological urge to reach beyond the status quo and seek out novelty, change, and excitement. Psychologist Frank Farley, of the University of Wisconsin, has spent twenty years examining what he calls the Type T (thrill-seeking) personality. According to Farley‘s theory, Big T types are high-profile individuals who seek excitement and stimulation wherever they can find it or create it. For some the thrills are mostly physical. For others, they‘re mental. The degree of risk that individuals are willing to assume spans a broad continuum. Big T personalities, those who continually live on the edge, are at one end of the scale. Little t‘s, who cling to certainty and predictability, are at the other. Most people fall somewhere in the middle. But Farley believes it‘s the Big T segment, a group that makes up an estimated 10 to 30 percent of the American population, that holds the key to America‘s future. ―Type Ts are the people who are likely to have enormous impact on society,‖ he says. ―They are the great experimenters in life; they break the rules.‖