principles of management mas...
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PRINCIPLES OF MANAGEMENTMAS 261
Dr. Mrs. Rosemary Boateng Coffie
Department of Human Resources and
Organizational Development
COURSE OBJECTIVES
By the end of the course students should be ableto understand the fundamentals and conceptualissues that underpin management.
They should also be exposed to real worldmanagement applications.
COURSE OUTLINEUnit 1 Meaning, Nature and Scope of
Management
Unit 2 Evolution of the Theory of
Management
Unit 3 Strategic Management
Unit 4 Functions/Process of
Management
Unit 5 Organisational Structure
Unit6 Motivation
Unit 7 Managerial Power
Unit 8. Organisational Communication
Unit 9 Decision Making in
organisations
Unit 10 Change Management
SUGGESTED TEXT BOOKS
❑Daft R L (2013) ManagementSouth Western Cengage
❑Lussier Robert N (2009). Management fundamentals. South Western Cengage
❑Coulter, M., (2009) Management. Prentice Hall London
❑Smith, M., (2007). Fundamentals of Management. McGraw Hill Education UK
MEANING, NATURE AND SCOPE OF MANAGEMENT
UNIT 1
LEARNING OBJECTIVES
By the end of this unit you should be able to:
1. Define and explain the meaning of management
2. Evaluate the various dimensions of Management
3. List and explain management functions
4. Identify of managers
5. Describe the nature of management and administration as process
6. Discuss the perspectives of management as a Science and an Art.
WHAT IS MANAGEMENT?
DEFINITION OF MANAGEMENT
Mary Parker Follet > “Getting things done through other people”
Henri Fayol (1916) argues that to manage is to forecast and plan, to organize, to command, to co-ordinate and to control.
F.W. Taylor (1886) (Father of Scientific Management), has postulated that management is “The determination of the overall policy of a business organization”
SOME MODERN DEFINITIONS FOR MANAGEMENTS
•The coordination and organisation of the activities of a business in order to achieve defined objectives (Drucker 2004)
•Hill McShane (2009) defined management as the art of getting things done through people which is similar to what Mary Parker Follet did in the past.
OPERATIONAL DEFINITION
The simple definition is the activity of usingresources in an effective and efficient way so thatthe end product is more than the initial resources.
.
Inputs Output
Value x Value x +Transformation
THE THREE DIMENSIONS OF MANAGEMENT
Strategic
level
Tactical
level
Operational
level
TYPES OF MANAGERS• Responsible for a common activity within the
organization.
• e.g. Research, Human Resource, Marketing, Finance and Production
Functional Managers
• Responsible for a distinct unit within the organization, this might relate to the functions at a geographical location, a division or subsidiary
General Manager
• Responsible for a temporary team that has been put together to plan and implement some form of change or carry out an activity with a limited life span.
Project Manager
• They are those managers who are in charge of a particular function directly involved in making or supplying goods or services to customers.
Line Manager
MANAGEMENT AND ADMINISTRATION:ARE THEY THE SAME?
Definitions
Brech: administration as apart of management. In otherwords, administration is asubset of management.
Mullins: administration isinterpreted as part of themanagement process, andconcerned with the design andimplementation of systemsand procedures to help meetstated objectives”
General interpretations
Administration deals with the general andactual implementation of the policies initiatedby the top management
Administration is an activity that takes placebelow the top management level of anorganization and performed by the functionalor the departmental managers and below.
Administration states the job description jobtitles, lines of authority. i.e. who reports to whoetc.
Administration puts into action, what is to bedone and provides guidance so that what is tobe done is done properly.
RELATIONSHIP BETWEEN MANAGEMENT AND ADMINISTRATION
Shareholders
Human Resource
Manager
Production
Manager
Marketing
Manager
Board of Directors
Managing Director/CEO
Ad
ministra
tion
THE NATURE OF MANAGEMENT
Management as a profession
Management as a universal
process
Management as a Science
Management as an Art
ASSIGNMENT 1 ( TO BE DONE IN GROUPS)
On the basis of the discussions in class, to what extent do you agree that management is a:
Profession
Science
Art
Universal process
WHO ARE MANAGERS?
WHO ARE MANAGERS?
They are found in government departments, smallbusinesses, not-for profit agencies, museums, schools, andeven such non-traditional organizations as politicalcampaigns and consumer cooperative.
Managers can also be found doing managerial work inevery country around the globe
In addition some managers are top-level managers, While others are first-line managers.
today, managers are just as likely to be women as they are men, although the numbers of women who are top-level managers remain low.
•They were the organizational members who told otherswhat to and how to do it.
•It was easy to differentiate managers from non-managerial employees. But it is not quite so simpleanymore.
So how do we define who managers are?
A manager is someone who coordinates and oversees the work ofthe people so that the organizational goals can be accomplished.
A manager’s job is not about personal achievement –it’s abouthelping others do their work that may mean coordinating the workof a departmental group or it might mean supervising a singleperson.
MANAGERIAL ROLES
Mintzberg (1973) for example, in reporting his major study ofmanagerial work, highlights a number of key roles that seem toappear regularly in such work.
He describes these roles as ‘organized set of behavior identifywith a position’, and gathers them into three main groupings, asfollows:
MINTZBERG’S MANAGERIAL ROLES
LEADER
THE SEVENTEEN MANAGERIAL ROLESOF DUBRIN
DuBRIN (2009) grouped managerial roles under each function as follows:
MANAGERIAL ROLES DURING PLANNING
Strategic planner
Operational Planner
MANAGERIAL ROLES DURING ORGANISING
Organizer
Liaison
Staffing coordinator
Resource Allocator
Task Delegator
THE SEVENTEEN MANAGERIAL ROLESOF DUBRIN CON’T
MANAGERIAL ROLES DURING LEADING
Figurehead
Spokesperson
Negotiator
Motivator & Coach
Team Builder/Team player
Technical problem solver
Entreprenuer
MANAGERIAL ROLES DURING CONTROLLING
Monitor
Disturbance Handler
Stewart (1944), points out that there are three categories ofmanagement positions:
The first level entails direct responsibility for other people,
The second entails responsibility for managers,
The third entails responsibility for multiple functions ( the generalmanager’)
In each of these situation the job-holder is faced with some crucialconcern.
Stewart considers that managerial job, in particular, are affectedby the extent of and the relationship between the following:
The core of the job (i.e. the personal responsibilities of thejobholder which cannot be delegated), which she terms the‘demands’ of the job.
The ‘constraints’ of the job (e.g. limited resources)
The choice available to the job holder by way of different workfrom another person (e.g. different amounts of time spent onoperational as opposed to strategic matters.
MANAGERIAL SKILLS
Robert L Kartz (1974) a social psychologist developed onthe skills of an effective administrator concluded thatmanagers need three essential skills and level ofmanagement.
These he labeled as Technical Skills, Human Skills andConceptual Skills.
TECHNICAL SKILLS
These are work job-specific knowledge and techniquesneeded to proficiently perform work tasks.
These skills tend to be more important for first line managersbecause they typically manage employees whose tool andtechniques to produce the organizations product or to servicethe organizations customers.
Often employees with technical skills get to be promoted tofirst line managers positions.
HUMAN SKILLS
This involves the ability to work well with other people bothindividually and in groups, because all managers deal withpeople.
These skills are equally important to all levels of management.
Managers with good human skills get the best out of their people.They know how to communicate, motivate, lead and inspireenthusiasm and trust.
CONCEPTUAL SKILLS
These are skills managers use to think and to conceptualize aboutabstract and complex situations.
Using these skills managers see the organization as a whole,understand the relationship among various subunits and visualizehow the organization fit’s into its wider environment.
These skills are most important to top managers.
SKILL TYPE NEEDED BY MANAGER’S LEVEL
Top
Managers
Middle
Managers
Line
Managers
Conceptual Human Technical
OTHER MANAGEMENT SKILLS
Other important managerial skills that have been identified in thevarious studies are:
Delegating Effectively,
Communicating Effectively,
Thinking Critically,
Managing work Load/Time,
Identifying clear roles for employees,
Creating an environment of openness, trust and change.
ENVIRONMENTAL CONSTRAINTS ON MANAGERS
A manager must be aware of environmental issues when managing a business.
Why would managers need to know about the environment? Because it has the potential
to constrain decisions.
THE BUSINESS ENVIRONMENT
CONSTITUENTS OF THE BUSINESS ENV.
ASSIGNMENT ONE
MANAGEMENT CAN BE REGARDED AS A
SCIENCE AND ALSO AS AN ART. DISCUSSS
Unit 2
Evolution of the Theory of
Management
LEARNING OBJECTIVES
By the end of this unit you should be able to:
1. Analyse the changing trend in management
2. Describe the inter-disciplinary nature of management
3. State and explain the theories/ approaches to management
4. Describe and apply the behavioural approach
5. Describe and explain systems theory
6. Explain contingency view
7. Explain the quantitative approach—Management science
EVOLUTION OF THE THEORY OF MANAGEMENT
•Evolution of management is concerned with the various developmental stages that management has gone through over the years.
•Management not recognized as a distinct subject
•Management could be performed by anybody
•Management was therefore marginalized
•If one has not studied accounting, he cannot describe himself as accountant. The same cannot be said of management.
CHANGING TREND
Paradigm shift: mgt now regarded as distinct subject.
Evidence: the existence of many management and administration educational institutions in the world over.
Management came about through personal intuition, practice and art.
Many practitioners also went through formal training (science)
The various principles of management propounded by Fayol was as a result of practice and formal training.
INTER-DISCIPLINARY NATURE OF MANAGEMENT
Management borrows ideas from many disciplines-Economics, Accounting, Sociology.
The effective manager demonstrate rich knowledge in many fields.
The need to broaden manager’s knowledge.
Experts in other areas have contributed to the development of management
THEORIES OR APPROACHES TO MANAGEMENT
PROPOUNDERS OF THE MGT. THEORIES
DIAGRAM TO REPRESENT THE APPROACHES TO MANAGEMENT
Classical Approaches
Scientific
MGT
Administrative MGT
Bureaucratic
MGT
Behavioral Approaches
Early
Advocates
Hawthorn Studies
Organisational
Behaviour
Quantitative
Approaches
Contemporary Approaches
Systems
Approach
Contingency Approach
Management
Science
Approach
CLASSICAL/TRADITIONAL APPROACH•The key assumption-people are rational and economically oriented
•It focuses extensively on formal organization
•It deals with management and organization by emphasizing organization's purpose and formal structure
•Emphasis on planning of work, the technical requirement of the organization, principles of management and rational and logical behavior.
BRANCHES/DIMENSIONS OF THE CLASSICAL SCHOOL
Scientific management
Administrative management
Bureaucratic management
SCIENTIFIC MANAGEMENT
Improving general manufacturing process leading to improving productivity.
Proper work procedures-uninterrupted materials flow
Emphasizes scientific methods
No regard for intuition, experience, practice and guess work.
PIONEERS IN THE FIELD OF SCIENTIFIC MANAGEMENT
F.W Taylor
Key areas of contribution are:
Scientific methods of doing things
Scientific selection of workers with clearly defined roles
Scientific education, training, and development of the worker
Scientific development of co-operative spirit between management and labour
There should be a complete mental revolution (substituting scientific methods for intuition, opinion and guesswork)
Taylor was more concerned with: finding one best way of performing a task
His philosophy of work was based on motivation
The prosperity of employer and employees achieved through maximizing productivity
IMPLICATIONS
Assignment of roles and responsibilities
Division of labour and specialization
Designing of organizational structure
THE GILBRETHS
Credited with time and motion study
Also finding one best way of doing things
They practiced what they preached
They laid down systematic and scientific rule
They maintained that motion and fatigue are intertwined
HENRY GANTT
He was a disciple of Taylor and the Gilbreths
Not happy with too much emphasis on scientific methods to the neglect of the individual worker
He was not in favour of differential reward system: workers were paid different pay rate for achieving 70%, 100% and 120 % of target level (it does not motivate employees).
GENERAL CONTRIBUTIONS OF SCIENTIFIC
MANAGEMENTScientific approach to doing things
Scientific improvement in work methods
Payment by results
The basis for advanced studies in motion studies (work studies)
Reduces putting square pegs in round holes
It emphasized the importance of education and training to enhancethe efficiency of employees
LIMITATIONSWork gets exhausted leading to redundancy and lay offs
Little regard for human feelings
Too much emphasis on productivity and profit
No regard for discretion and initiative
Motivation narrowed to the bonus system to the neglect of respect for employees
Managers having exclusive right to planning and control
ADMINISTRATIVE MANAGEMENT THEORY
Major purposes:
Developing principles that could guide the design, creationand maintenance of large organizations
Identify the basic functions of managing organizations.
HENRY FAYOL
•Founder of the classical approach
•Concern with the totality of organizations
•Management most neglected aspect of business operation
•Before Fayol-managers are born, not made
•Given the following accolades:
➢ Father of classical approach
➢Father of modern management theory
➢Practical man of management
FOURTEEN PRINCIPLES OF FAYOL
FAYOL’S FUNCTIONS OR PROCESS OF MANAGEMENT
Planning
Organizing
Commanding
Co-ordinating
Controlling
Leading/Directing and Staffing
LYNDALL URWICK’S 10 PRINCIPLES OF MANAGEMENT
Objective
Authority
Correspondence
Balance
Specialization
Responsibility
Continuity
Co-ordination
Definition (jobs)
Span of control
CONTRIBUTIONS/CRITICISMS OF ADMINISTRATIVE MANAGEMENT THEORY
Contributions
❖It has provided blue-prints in management
❖Foundation for present key emphasis on the functions of management
❖Has enhanced and promoted the skill of managers
❖No room for deviation because of principles: trial and error avoided
Criticisms
❖Stifles initiative and discretion
❖Principles are not applicable in all situation
❖No regard for the human factor
BUREAUCRATIC MANAGEMENT
The third arm of the classical approach
Associated with Max Weber
Bureaucracy
Referred to as “red-tapeism” (too much rules, regulations, and paperwork leading to inefficiency)
Also referred to as officialdom
The concern of Weber was on bureaucracy as a form of organization with hierarchy of authority regulated by rules and regulations.
FEATURES OF BUREAUCRACY
Rules and regulations
Division of labour and specialization
Appointments to positions based on technical competence
Hierarchical arrangement of jobs
Ownership separated from management
Rules, decisions, and actions are recorded in writing
THE BEHAVIORAL APPROACH
THE BEHAVIOURAL APPROACH
It was developed to take care of the human element in organizations which was a major limitation of the classical approach.
The major assumption that underlines the behaviouralapproach is that people are social and self-actualizing.
HUMAN RELATIONS
Founded by Prof. Elton Mayo (1880-1949).
Many antagonisms, suspicions, acrimonies, wrangling, strikes, riots, demonstrations, etc. are often the result of how people in an organization are treated.
HUMAN RELATIONS
❑The approach is deeply rooted in the social environment and personality trait of the manager unlike the classical approach which emphasized the physical environment.
❑The main underlying principle in this approach is that the achievement of organisational effectiveness depends on how people’s needs and wants are satisfied.
❑Expert in this approach say that managers should be trained in both ‘technical skills’ and ‘people skill’.
HAWTHORNE EXPERIMENTS
Objectives of the experiments were to:
1. To determine the effects/impacts of changes in illumination on worker productivity.
2. The determine the effects of work-related periods, coffee breaks, shortened work days and other changes in working conditions on worker productivity.
3. To interview workers to determine workers’ attitude.
4. To analyse the various social factors at work.
SYSTEMS THEORYA system is an interrelated and interdependent set of elements functioning as a
whole. It is an open system that interacts with its
environment.
SUBSYSTEMS
Subsystems are systems within a broader system.Interdependent subsystems (such as production, finance,and human resources) work toward synergy in an attemptto accomplish an organizational goal that could nototherwise be accomplished by a single subsystem.
SYNERGY
Systems develop synergy.
This is a condition in which the combined and coordinatedactions of the parts of a system achieve more than all theparts could have achieved acting independently.
Entropy is the process that leads to decline.
The whole is greater than the sum of its parts.
CONTRIBUTION OF THE SYSTEM APPROACH
It ended the dominance of the classical and the behavioural approaches.
It blended the opposing views of both the classical approach and the behavioural approach.
It brought to fore the important role the environments and its elements play on business activities.
It cautions managers to be circumspect in the decision-making process since a decision made in one department can affect almost all the other departments
It creates the awareness of sub-systems each with potentially conflicting roles and goals which must be integrated.
It focuses attention on inter-relationships between it and its environment i.e. the need of the system as a whole.
CRITICISMS OF THE SYSTEMS APPROACH
It is perceived that some organizations operate successfully and achieve their corporate objectives under the closed system i.e. without recourse to the external environment. Eg.Trokosi
The environment and its elements sometimes have negative impact on organization.
The external environment has negative socio-cultural practices that may adversely affect other organizations that may relate to it.
Breakdown of a sub-system of a system may affect all the other systems and a general breakdown of the entire systems.
The impact of a decision in one department on the entire organization may cause managers to be over-circumspect. This may lead to delays in decisions or no decisions at all.
CONTINGENCY VIEW/APPROACH
CONTINGENCY VIEW
This view emphasizes the fit between organization processes and the characteristics of the situation.
It calls for fitting the structure of the organization to
various possible or chance events.
CONTINGENCY VIEWIt questions the use of universal management practices and advocates using traditional, behavioural, and systems viewpoints independently or in combination to deal with various circumstances.
The contingency approach assumes that managerial behaviour is dependent on a wide variety of elements.
Thus, it provides a framework for integrating the knowledge of management thought.
CONTRIBUTIONS TO THE CONTINGENCY APPROACH
It gives rise to the notion that different problems require different methods or approaches of solution.
It calls for the application of different management styles in dealing with different situations.
It has eliminated some of the loopholes associated with the classical approach.
CONTRIBUTIONS TO THE CONTINGENCY APPROACH
For example, the classical approach wanted to find only one best way of doing things.
The contingency approach does not subscribe to this.
It creates a synthesis and a collaborative relationship among other approaches.
LIMITATIONS OF THE CONTINGENCY APPROACH
The ideal of psychic unity of mankind implies that certain principles and perceptions are capable of universal application.
Different management styles based on situational analysis may not always yield the same expected results.
MANAGEMENT SCIENCE ORQUANTITATIVE APPROACH
MANAGEMENT SCIENCE ORQUANTITATIVE APPROACH
The emphasis of this approach is on the use of quantitative techniques in solving management related problems in the areas of Statistics, Mathematics and Computers.
The focus of the approach is on technical problems rather than on Human/personal problems.
The computer has emerged as a very important facilitator to this approach.
PRACTICAL APPLICATION OF MANAGEMENT SCIENCE APPROACH
1. Mathematical forecasting- for projections into the future for planning purposes.
2. Inventory modeling- to exercise effective control over inventories by mathematically establishing how much/many to order and produce.
3. Linear programming- it deals with the allocation and utilization of scarce resources among competing ends/uses.
4. Queuing theory- it deals with the facilitation and allocation of service personnel or work stations to minimize customer waiting time and service cost.
4. Network model/analysis- breaking large tasks into smaller and simpler components so that they can be properly worked on. It can also be used to map out programmes of activities in such a way as to create the most effective planning and control.
4. Simulation- makes models of problems to create hypothetical situations to test different solutions under various assumptions
THE ABOVE TECHNIQUES AIM AT:
1. Rational decision
2. Economic viability of such decisions based on proper cost, revenues and returns on investment analysis
3. Using appropriate mathematical models based on formulas and rules.
4. Using computers for faster processing of large mass of data.
CONTRIBUTIONS OF THE MANAGEMENT SCIENCE APPROACH
Introduction of the various techniques.
Use of mathematical models in dealing with production issues often lead to concise and unambiguous solutions in contrast with the behavioural approach.
It has improved on the mathematics/quantitative reflexes of managers.
LIMITATIONS OF THE MANAGEMENT SCIENCE APPROACH
The fact that management is a behavioural science implies that it is not in all cases that a mathematical model can be used to explain why a person behaves in a certain manner towards another.
The use of computer in analysing certain events may sometimes be influenced by human beings who operate it and this may lead to manipulation of figures.
GROUP ASSIGNMENT 2
❑ DISCUSS THE RELEVANCE OF THE SCIENTIFICMANAGEMENT APPROACHES TO ORGANISATIONS.
❑DISCUSS THE RELEVANCE OF THE MANAGEMENT SCIENCEAPPROACHES TO ORGANISATIONS
UNIT THREESTRATEGIC
MANAGEMENT
STRATEGIC MANAGEMENT
The word strategy derives its origin from the Greek word strategies, which means the art or science of being a military general.
Effective Greek generals had to determine the right amount of logistics needed to fight; where to fight and where not to fight; the army’s relationships with citizens, politician, diplomat, etc.
STRATEGIC MANAGEMENT
Strategy has both decision making component and planning component.
Military Generals are therefore supposed to decide and plan strategically.
These two components constitute the key elements to success in strategic management.
DEFINITION
Strategy is the plan that integrates an organization’s major goals, policies and action sequence into a cohesive whole.
It is a managerial game plan for running an organisation.
Must be innovative
Must result in competitive advantage
Must be aggressive, bold, and fast-moving
STRATEGY
Good strategy and good strategy implementation are the most trustworthy signs of good management.
This is not to imply that good strategy implementation will automatically guarantee excellent organisational performance every year.
Success will partly depend on the manager’s ability to adjust to competition and other environmental factors.
STRATEGIC MANAGEMENT
G.A. Cole defines it as ‘the process of determining, evaluating and adopting the aims or mission of an organization and the patterns of decisions that guide the achievement of those aims in a long-term’.
According to Cole, the prime responsibility for strategic management lies with the top management of the organization e.g. Chief Executive and the board of directors.
STRATEGIC MANAGEMENT
Strategic Management is the process by which guidingmembers of a nation, community or organisation envisionits future and implement the necessary strategies,operations and policies to realise that future.
The essence of strategic management is to look ahead,understand the environment and effectively position anorganisation for competitive success in changing times.
ELEMENTS OF STRATEGIC MANAGEMENT DIRECTION
1. VISION
An organization’s vision is its reason for existence.
It spells out what the organization wants to become in future.
A business’s vision is to earn profit for its owners.
A university’s vision is to educate and pursue knowledge.
An organisation or a person who is able to accurately predict what is likely to happen in the future and takes appropriate contingency measures to deal with such future events is regarded as visionary.
To have a vision is to be proactive instead be being reactive.
2. MISSION
An organization’s mission statement specifies how its managers have decided to fulfill or achieve its purpose. The mission:
identifies the unique set of characteristics and strengths of the organization that are its competitive advantage and
defines the scope of business operations in the provision of products and services offered and the markets in which it intends to compete.
MTN VISION & MISSION
Vision: to be the leading telecommunication service provider in emerging markets.
Mission: Building shareholders’ value by ensuring maximum customer satisfaction through providing latest telecommunication services, at the most economical rates while meeting its social responsibilities as a good corporate citizen and providing growth prospects for its employees.
Values (guiding principles): Leadership, Innovation, Integrity, Relationships and a Can-do spirit.
VISIONOur vision is to develop and grow as the leading fully integrated private waste management company in Ghana by 2015, relying on our cooperation with our partners in the industry, our associates and joint venture partners, both national and international, now and in the future.
MISSIONOur mission is to be at the forefront of the environmental sanitation services industry, by the introduction and utilization of simple but modern technologies and methods of waste management at affordable and competitive rates.
CORPORATE VALUESWe are committed to the provision of services which prevent environmental pollution and safeguarding public health.
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NEW VISION STATEMENT AND VALUE FOR ZOOM LION
Vision
To be the champion of clean, green and healthy communities.
Value
oGodliness and fellowship
oIntegrity
oDiscipline
oAccountability
oSpeed and accuracy
oSimplicity in innovation
3. OBJECTIVES
Objectives are ends the organisation seeks to achieve through its existence and operation.
Objectives must be SMART
Specific
Measurable
Achievable
Realistic
Time related
Example: To recruit and select four I.T. specialists by 18th May 2016
OBJECTIVES
Objectives can range from Broad objectives to activities/micro objectives. Below, are examples.
Broad Objectives
To provide reliable, timely and quality service to our clients.
To achieve total customer satisfaction and loyalty
To help clients to achieve their reasons for existence
To attract and retain competent and motivated workforce
STRATEGIES
Invest in virtual technology for expansion
Strong financial base
Availability of Technology: offers the opportunity to overcome low spatial presence
Improve on the capacity of our support staff
Inadequately qualified support staff
Ghana as an emerging market
STRATEGIC OBJECTIVESStrategic objective 1: Needed virtual technology operational by the end of the financial year
Output 1: Four IT specialists appointed by 8th April 2011
Activity 1: Get the job description and person specification
Activity 2: Advertise vacancies
Activity 3: Shortlist applicants
Activity 4: Select 4 best candidates from shortlisted applicants
Activity 5: Orient selected applicants
4. VALUESValues are broad beliefs about what is or not appropriate behaviour. Values also imply what the organization believes and how it will act.
Example:
We are guided by:
Professionalism: being punctual, committed, competent, disciplined and reliable in the discharge of duty.
Excellence: doing little things very well.
Customer focus: putting customer interests first.
Hardwork: going beyond the call of duty/going beyond the expectation.
Confidentiality: non-disclosure of client information without authorization.
5. POLICIES
A policy is a working guidelines that enable strategic managers and thinkers to have a sense of direction on what to do and not to do.
Policy helps to co-ordinate decision-making and action-taking.
It is necessary to note that vision, mission and objectives constitute the key elements of strategic management direction.
STRATEGIC MANAGEMENT PROCESS
Charles W. L. Hill and Gareth R. Jones make mention that, ‘the majorcomponents of the strategic management process include
defining the mission and major goals of the organisation;
analysing the external and internal environment of the organisation;
choosing strategies that align or fit the organisation’s strength andweaknesses with external environment opportunities and threats;and adopting organisational structures and
control systems to implement the organisation’s chosen strategy’.
EXAMPLE OF MAJOR GOALS
To provide reliable, timely and quality service to our clients.
To achieve total customer satisfaction and loyalty
To help clients to achieve their reasons for existence
To attract and retain competent and motivated workforce
EXAMPLE OF SWOT ANALYSIS
S4, O7: Invest in virtual technology for expansion Strong financial base
Availability of Technology: offers the opportunity to overcome low spatial presence
W1,O5: Improve on the capacity of our support staff Inadequately qualified support staff
Ghana as an emerging market
S4T3: Invest in high yielding capital/money markets (to hedge against economic instability) Strong financial base
Economic instability: inflation, high cost of living, interest rate
ELEMENTS OF A STRATEGIC MANAGEMENT PROCESS
According to Schermerhorn, the strategic management process involves the following;
Strategy Formulation [creating strategies]
Strategy Implementation [putting strategies into action]
Strategy review [Evaluation to determine the success of the implemented strategy].
SPECIFICALLY, THE STRATEGIC MANAGEMENT PROCESS MAY BE OUTLINED AS FOLLOWS:
1. Environmental scanning -This process may consist of:
Forecasting changing conditions
Analysing the effects of change
Making decisions- that is strategic thinking – making sense out of an uncertain future.
Envisioning the organisation in the context of world trends of events, and identifying interferences.
Focusing on how the organisation should act and react to emerging opportunities and threats.
Need for strategic foresight to address issues such as what is to be done.
2. STRATEGY FORMULATION
The starting point for strategy formulation is theidentification of current mission and objectives: analysis ofvalues and corporate culture, internal strength andweakness; and environmental opportunities and threats.
After the identification and analysis of all these issues; thenext issue is to periodically revise the mission andobjectives and where necessary and select new strategies.
3. STRATEGIC PLAN
It is concerned with addressing long-term needs and setcomprehensive actions action directions for an organisationor a subunit of it.
Strategic planning is the prerogative of top management.
Its scope involves determining objectives for the entireorganisation and then deciding on the actions andresource allocation to achieve them.
THE MAIN COMPONENTS OR OUTLINE OF A STRATEGIC PLAN
Executive summary-This highlights the vision, mission objectives/goalsand the strategies required to be used
Strategic diagnosis-This deals with swot analysis that is the strengths,weaknesses opportunities and threats.
Strategic intent and direction-This section deals with vision, mission,values, goals, objectives, strategies, plans etc.
Strategic implementation-Issues addressed in this section include leadership,
organisational structure, culture, policies Contingency plan-This should be able to deal with unforeseen circumstance which may derail the good intentions of the strategic plan
Financial plan-This should highlight all the financial implication of the plan. It should also address issues of cost-benefit analysis. Under financial plan, efforts should be made to lower cost and increase profit.
IMPLICATIONS OF STRATEGIC MANAGEMENT
The objective of strategic management is to find out whysome organisations succeed while others fail; why successturns into failure and vice versa.
The three broad factors that may determine anorganisation’s success include the following: the industry inwhich it is based, the country/countries in which it is basedand the resources, capabilities and strategies available.
END OF UNIT THREE
UNIT FOURFUNCTIONS/PROCESS OF
MANAGEMENT
THE FUNCTIONS OF MANAGEMENT
PLANNING
1. PLANNING
It is often said that if you fail to plan you plan tofail.
Experience has shown that the achievement levelof individuals, institutions and communities whichplan are always higher than those who fail toplan.
It is the first and the most important of all thefunctions of management. This is because theother functions of management cannot take placewithout planning.
DEFINITION OF PLANNING
Planning entails deciding what the organisation want or seek to do in the future.
It involves forecasting, predicting, anticipating and preparing for the present to face conditions that may arise in the future.
It also involves first of all making decisions about policies, selecting objectives and setting out the programmes and procedures for achieving them.
It has to do with deciding in advance what to do, who is to do it, how to do it, where to do it and when to do it.
Planning is future- bound
ELEMENTS OF PLANNING
The five main elements of planning are:
Objectives/mission statement
Actions- means/specific activities planned to help achievethe objective.
Resources- logistic required to carry out the plan.
Implementation-assignment and direction of personnel tocarry out the plan.
Evaluation- assessment of the results of what had beenplanned and put to action
IMPORTANCE OF PLANNING
Co-ordinate the efforts of all personnel and directs the proper use of all other resources.
Develop performance standard or targets and to operate within the standards or targets and to operate within the standard set
Give direction to managers and provides a means of developing them.
Bridge the gap between where we are now and where we want to be.
Makes it possible for things to occur which would not otherwise happen.
Simplify decision-making and avoids procrastination
Ensure effective allocation of scarce resources that havecompeting uses.
Helps to implement the other basic functions of management –organizing, directing and controlling.
Predicts and foretells the effects of future events and enablean organisation to meet the future with some degree ofsuccess.
THE PLANNING PROCESS
PLANNING PROCESSBasically, it deals with the following five key issues or question
Where are we coming from?[past analysis]
It involves examining the past in terms of institutional background, important past experience [negative and positive] track record, achievements and things that have help in bringing the institution thus far.
Where are we now? [current situation or need]
Techniques for carrying out this exercise include the following
Surveys in the form of interviews, discussions, observations etc
Documented sources
SWOT Analysis
Where do we want to go? [that is our goal or target]
This is thee for envisioning and dreaming about the future.
It entails two important activities; goals and objective setting.
They only provide a framework for action. Objectives arederived from goals
How can we get there? [methods and strategies]
The issue here is strategy development. This entails coming outwith specific measures and methods for implementing theobjectives derives from the goals. This is done through a Plan ofAction.
PLAN OF ACTION
They include the following:
Activities: defining specific actions to be undertaken. That is guidelines on what should be done should be clearly stated.
Setting of Priorities: Ordering of the activities according to the pressing needs and availability of resource.
Scheduling and Timing: organisation of the activities with specific time perspectives.
Role Casting: who does what? Ensuring that specificindividual/functions are assigned to the various activitiesdefined.
Location-Specification of venue for each activity.
Budget: computing the cost of executing your activities.
Resource Mobilisation: This involves mobilising the financial,material and human inputs required for theimplementation of the plan.
How can we know if we are getting there? [evaluation]
This will be determined by the initial success rate after evaluation of what had been done.
This makes it imperative to undertake periodic evaluation of performance by comparing standard with actual performance.
TYPES OF PLANNING
OTHER TYPES OF PLANNING
•Human Resource Planning
•Financial Planning
BENEFITS OF PLANNING
Planning provides management with a systematicforward thinking.
It encourages interactions among company’s executives.
It provides room for improving the objectives and policiesof the company.
It brings about coordination of all the company’s effort.
It provides clear performance standards for control.
It helps companies to prepare and respond positively tochanging environmental factors.
Goals down – plans up planning
This where the goals are set by top levelmanagement and handed down to functionalunits.
Lower level management then develops plans toachieve these goals.
The plans are then forwarded back to topmanagement for consideration and approval.
These plans are then incorporated into thecorporate plan.
In the light of this, top management setcorporate goals for the planning period e.g. oneyear.
ORGANISING
ORGANIZING: MEANING AND NATURE
This deals with:
establishing the structure of the tasks to be performed toachieve the goals of the organisation;
grouping these tasks into jobs for an individual;
creating groups of jobs within departments;
delegating authority to carry out these jobs;
providing systems of information and communication andco-ordinating activities within the organisation.
ORGANISATION: MEANING AND NATURE
Organisation has to do with breaking business activity intovarious stages and each stage assigned to specialist towork on.
It designs an organisational structure for the purpose ofcreating a framework for achieving organisationalobjectives.
Organizing establishes relationship among personnel sothat each person knows his/her duties and responsibilities.It also defines the reporting lines and the extent of one’sauthority.
BROAD AREAS OF ORGANIZING1. Design of an organisational structure:
2. Search for appropriate personnel to fit into the organisational structure through recruitment and selection.
3. Allocation and assignment of rules and responsibilities
4. Establishing standard of performance
What people should do
Whether people are doing what is expected of them.
The appropriate remedy to apply when people do the wrong thing.
DIRECTING/LEADING
Directing ensures that subordinates are provided withappropriate guidelines and encouragement to enablethem work in a harmonious manner towards the successfulachievement of organisational objectives.
Leading/directing seek to provides leadership, guidance,supervision, stimulation, motivation and inspiration.
The main focus of directing or leading is to ensure thatsubordinates keep to plans and are willing to carry outtheir duties that will facilitate the successfulaccomplishment of organisational objectives.
This depends on the ability of the leader or the director toprovide the appropriate environment that will spur on ormotivate subordinates to achieve what the leader or thedirector wants to achieve.
CONTROLLING
Controlling as a function of management ensures that plans have been carried out according to set standards and deviations identified and corrected.
Controlling deals with the measurement of performance in relations to expected standard of performance.
ELEMENTS OF CONTROLLING
The three main elements of controlling are:
Setting standard of performance-to decide in advance what isto be done according to a set target.
Measuring performance against standard-to review by way ofcomparison whether performance is in line with expectedstandard.
Taking corrective measures to attend to deviations if any-ifperformance is not in line with expectation[deviation], acorrective measure should be taken to remedy the situation.
SPAN OF CONTROLThis deals with the appropriate number of subordinates a superior controls.
It was developed by V. A. Graicunas [1937], a French management consultant.
According to him, the ideal number of subordinates a supervisor should control is six Graicunas’s claim is supported by LyndallUrwick [1952] who prefers not more than five subordinates under a superior.
The claim of Graicunas, Urwick and others are highly debatable.
This is because; there are several factors that determine the span of control of every manager.
These factors may include:
Nature of work- whether simple, repetitive or otherwise.
The kind of organisational structure- whether tall or flat
The level of knowledge and experience of subordinates.
The ability of the manager himself- inexperienced orexperienced.
The consequences of mistakes- the degree to which theconsequences of mistake will impact on the organisation.
The degree of hazards or danger
The degree of physical proximity
The degree of delegation and decentralisation
UNIT FIVEORGANISATIONAL STRUCTURE
WHAT IS ORGANISATIONAL STRUCTURE?
Organisational structure has been given various definitions some ofwhich are outlined below:
The way in which an organisation’s activities are divided,organised and co-ordinated.
The system of tasks, reporting relationships, and communicationthat link people and groups together to accomplish task that servethe organisational purpose.
The pattern of relationship among positions and members in anorganisation.
IMPORTANCE OF ORGANISATIONAL STRUCTURE
It provides the basis for the assignment of duties and responsibilitiesto individuals.
It provides a network of roles for people to know what they aresupposed to do.
It provides a means for responsibilities and authority relationship.
It provides a basis for grouping work into departments, sections andunits under the supervision of a manager.
It provides a means for delegation and accountability.
It provides a hierarchy of roles so that people get to know who issuperior, subordinate and colleague.
It directs the flow of authority and responsibility on the scalar chainof command.
FACTORS THAT INFLUENCE THE DESIGN OF AN ORGANISATIONAL STRUCTURE
Size- Large organisations tend to be structurally complex than small organisation. The size of the organisation therefore affects its size.
Strategy- There three main strategic objectives that are pursued by organisations: innovation, cost minimisation and imitation. For example, cost minimisation strategy make organisations mechanistic in structure: tight controls, extensive work specialisation and high centralization.
Technology- Technology refers to the activities, equipment and knowledge necessary to turn organisational inputs into desired outputs. It could also be described the type of materials, equipment, factory layout, degree of automation, specialisation, operational methods etc.
Environment-This refers to those forces and factors outside the organisation that potentially affect the organisation’s performance. Where environments are stable, structures tend to be mechanistic; Environmental uncertainty and complexity results in organic structures.
TYPES OF ORGANISATIONAL STRUCTURES
1. Functional/lateral/horizontal
It is a structure that groups together people with similar skills who perform similar tasks.
It is based on the principle of specialisation where marketing related problems are handled by marketing experts, finance by finance experts in that order.
Functional experts/specialists offer common service throughout all the department of the organisation.
Functional experts do not have direct authority over those who make use of their services e.g. even though the Human Resource Manager can provide services on performance appraisal to the Finance Manager; he has no control or authority over him.
2. LINE/DIRECT/SCALAR
Authority flows vertically down, that is, from the top to the bottom.
Line organisation structure refers to those functions which are directly concerned with specific responsibility for achieving the main objectives of an organisation and to those people in the direct chain of command.
There is unity of command in line organisation structure.
3. STAFF
It is a structure made up of people who provide specialised support services for the line organisation. People in staff organisations are in auxiliary, advisory and support positions.
They are indirectly concerned with the achievement of organisational objectives.
In a manufacturing organisation, staff personnel may include the Human Resource Manager, the Solicitor Secretary, Public Relations Manager.
Line personnel may also include Quality Control Managers who are at the same time functional managers depending on their level of specialisation.
DIFFICULTIES BETWEEN LINE AND STAFF
The relationship between line and staff personnel is not easy to distinctively demarcate since overlapping is possible.
There seem to be conflicting roles. Line managers often criticise staff managers of unnecessary interference in their work.
Staff managers are often branded as being remote or out of touch with realities on the ground.
Staff managers are regarded as having less-demanding and unimportant duties.
OTHER EXTENSIONS OF ORGANISATIONAL STRUCTURE
Tall organisational structure
Flat organisational structure, and
Matrix organisational structure
Matrix organisations are sometimes referred to as multiple command system.
It is a structure in which employees report to functional or divisional manager and at the same time to project or group manager.
That is, employees have two bosses.
SAMPLE TALL ORGANISATIONAL STRUCTURE
MD
Dept MD
RM
FH
SUP
Staff
RM
FH
SUP
Staff
RM
SAMPLE FLAT ORGANISATIONAL STRUCTURE
MD/CEO
Staff Staff Staff
GM
SAMPLE MATRIX ORGANISATIONAL STRUCTURE
Functional Manager
Functional Manager
Functional Manager
Team Member
Team Member
Team Member
Team Member
Team Member
Team
Member
COMMITTEE ORGANISATIONAL STRUCTURE
A committee may be a person or a group of persons with delegated duties to perform.
Membership may depend upon the duties to be performed.
There are some reasons for forming committees.
Committees help to solve a problem that requires specialised knowledge.
Committees help in avoiding the danger of delegating too much authority to one person; if it is not a one-man committee.
It relieves managers of increased workload.
Finally, it facilitates co-ordinating the activities of other committees.
TYPES OF COMMITTEES
Executive committee/management committee-Usually composed of departmental or functional managers
Standing Committee- This has a longer life span and responsibility for undertaking an assignment of a continuous nature. A board of directors is a type of standing committee formed by shareholders to run a business on their behalf.
Ad-hoc committee-This type of committee is formed to perform a specific assignment after which it ceases to exist. It is often referred to as a special or fact-finding committee.
Task force: A type of ad-hoc committee but has a relatively longer life span.
Sub- Committee: a committee formed from a bigger committee.
Co-ordinating committee: It co-ordinates the activities of two or more committees.
MAKING COMMITTEES EFFECTIVE
Tasks to be performed should be clearly defined.
There should be proper selection of members based on qualification, experience, and competence among others.
The necessary facilities should be made available to the committee.
The chairman should provide effective leadership.
And finally, members should exhibit good inter personal relationship.
ADVANTAGES OF COMMITTEES
There is pooling of ideas- two heads are better than one.
Effective use of specialist knowledge.
Checks the wrong use of authority if it is not the one-man type
Leads to participatory management or decision-making
It is a useful channel of communication.
DISADVANTAGES OF COMMITTEES
It is time consuming
It often disrupts the normal activities of its members.
The chairman or a member may be domineering or intimidating in consensus building.
The cost of running a committee may sometimes exceed the expected benefit.
Committees sometimes weaken authority and accountability.
A weak management may sometimes hide behind a committee and make decisions.
Arriving at a consensus is sometimes a problem, since there may be dissenting views.
AUTHORITY
It is the right to act or to direct the actions and behaviours of others. It is the legitimate right to influence the performance of others. According to Henri Fayol, ‘authority is the right to give orders and the power to exact obedience’.
TYPES OF AUTHORITY
Line authority- It is a superior-subordinate relationship. It enables a superior to control and direct the activities of a subordinate. It is exercised along the chain of command from the most senior manager to the lowest placed employee. It cannot be exercised along the horizontal channel but in the same department.
Functional authority-It is the right or the power a person has by virtue of his technical knowledge to control a certain activity. It involves giving instructions in a specialised or technical field. It can be exercised along the horizontal level of an organisation.
Staff authority-It provides auxiliary functions to enable line personnel to work effectively and efficiently. It is concerned with counselling, recommending, advising etc. Staff authority usually has lesser power than line authority and functional authority.
DELEGATION
Delegation is the process of giving part of the task/job to be performed to another person or groups of persons to do. It is a situation where a superior allows his subordinates to take part in the administration of an organisation by giving part of his duties to them.
Delegation does not free or exonerates the superior from accountability and responsibility. The delegate should always be given commensurate authority with the responsibility.
IMPORTANCE OF DELEGATION
It utilizes the skills and abilities of subordinates.
It is a key principle under every organisational structure.
It enables subordinates to contribute to decision making.
It helps to develop and train subordinates.
It exposes subordinates to leadership qualities.
It increases the morale of subordinates who consider themselves to be part of management when managerial assignment are given.
RESPONSIBILITY AND ACCOUNTABILITY
Responsibility is the obligation to perform an assigned task in a suitable manner. Accountability on the other hand, refers to act of being held answerable for one’s conduct in respect of certain responsibilities or obligations.
The debate is whether authority, responsibility and accountability are delegable. Authority in no doubt is delegable. There is controversy over whether responsibility and accountability are delegable.
Some writers hold the view that responsibility is delegable. Another school of thought holds the view that responsibility is not delegable but rather it is authority that is delegable.
A critical analysis of the arguments above suggest that, if one is responsible for doing something, then it should be possible for the one to delegate what he is responsible for.
However, if the delegate is not able to do the work required, then the superior should be held accountable or answerable.
It can therefore be concluded that if responsibility for doing something is delegable but accountability which connotes being held answerable should not be delegated.
UNIT SIXMOTIVATION
UNIT OBJECTIVES
By the end of the lesson students should be able to:
Understand the concept of motivation
Identify and explain the theories of motivation
Apply the principles of motivation to their everyday management life.
MOTIVATION
One important aspects of management is to motivate staff
The word motivation was derived from the Latin word ‘movere’ which means to move
Motivation is the energy that catalyzes behavior.
MOTIVATION CONT.
Motivation includes 3 common characteristics:
1.It concerns with what activates human behavior.
2.It involves what directs this behavior toward a particular goal.
3.Motivation concerns how this behavior is sustained (supported)
TYPES OF MOTIVATION
There are two main types:
intrinsic and extrinsic
Intrinsic motivation occurs when you are passionate about a task and perform it for sheer pleasure of it. The motivator resides within you. Only some internal motivators are truly intrinsic.
TYPES OF MOTIVATION CONT.
Extrinsic motivation occurs when you perform a task because some force, either external to you (money, rewards, punishment) or internal to you.
( a value or a belief that impacts your sense of self-worth) drives you perform.
THEORIES OF MOTIVATION
There are two groups of theories.
Content and Process
Content theories stress the satisfaction of needs.
Process theories emphasizes the importance of rewards.
MOTIVATION CONT.
Major content theories of motivation include:
Herzberg’s two factor theory
Maslow’s hierarchy of needs model
Alderfer’s modified need hierarchy model
McClelland’s achievement motivation theory
McGregor’s two contrasting managerial approaches
MOTIVATION CONT.
Herzberg’s two factor theory
Hygienic factors: Things when present do not motivate people but its absence causes dissatisfaction. E.g. Salary, working conditions, company policy, interpersonal relations.
Motivators: Things that motivate people at work. E.g. Achievement, recognition, work itself, advancement, responsibility.
MASLOW’S HIERACHY OF NEEDS
Maslow Hierarchy describes individuals as wanting beings. His needs had five main lines.
Physiological
Safety
Social
Ego/Esteem
Self Actualization.
HIERARCHY REPRESENTED ON A PYRAMIDSelf
Actualisation
Ego/Esteem
Social
Safety
Physiological
ALDERFER ERG THEORY
Clayton Aldefer’s theory of needs was based on three basic situations
E- Existence: The desire for physiological and material well being
R- Relatedness: The desire for satisfying interpersonal relationship
G-Growth: The desire for continued personal growth and development
MCCLELLAND’S ACHIEVEMENT THEORY.
McClelland identified four main arousal-based, and socially developed, motives.
The Achievement motive (n-Arch)
The Power motive (n-Pow)
The Affiliative motive (n-Aff)
The avoidance motive.
DOUGLAS MCGREGOR-TWO CONTRASTING THEORIES
Theory X: Inherently Lazy people. Do not like work would have tobe coerced before they work.
Theory Y: People who like work and see work as natural. Theyneed to be provided with a conducive environment and they willwork very well.
PROCESS THEORIES
Process theories change the emphasis from needs as in contenttheory to the goals and processes by which workers aremotivated.
They attempt to explain and describe how people start, sustainand direct behavior aimed at the satisfaction of needs or theelimination or reduction of inner tension.
PROCESS THEORIES CONT.
The process theories to be dealt with in this work shall be:
Expectancy theory
Equity theory
Goal theory
EXPECTANCY THEORY-VICTOR VROOM
Expectancy theory proposes that people are motivated whenthey believe they can accomplish the task, they will get thereward and the reward for doing the task are worth the effort.
Vroom posits that motivation is a result of rational calculations.(1) A person is motivated (2) Performance will be rewarded and(3) the value of the reward is highly positive.
The interactive combination of all three influences motivation.Thus, Some Key concepts are defined in terms of probabilities
VICTOR VROOM’S FORMULAE
Motivation = Expectancy * Instrumentality * Valence
Expectancy refers to the persons perception of his or herability(probability to accomplish an objective. Usually the higherones expectancy, the better, the chance for motivation.
Instrumentality refers to the belief that the performance will geta reward. Usually the higher the instrumentality, the greater thechance for motivation.
Valence refers to the value a person places on the outcome ofa reward. Generally, the higher the value or the outcome of thereward, the better the motivation.
VROOM CONT.
Effort Performance Outcome
Outcome Valued by worker and
Perceived by worker to be linked will enhance
motivation
Training
Resource
Support
Appraisal
Reward
System
PORTER AND LAWLER EXPECTANCYPerceived effort
Ability
Reward Probability
Effort Performance Reward Satisfaction
Perception of
rewards
Equitable
rewardsPerceived
value
ADVANTAGES OF PORTER AND LAWLERS THEORY.
It is a comprehensive approach incorporating many variables. Instead of promotions it could be examination success, a company car, etc.
There is an emphasis on feed back and its importance.
It takes account of the money intervening factors that determine motivation and attitudes to work.
DIFFICULTIES WITH PORTER AND LAWLERS THEORY.
It has become very complex because it tries to incorporate somany variables.
It tends to concentrate on prediction in terms of present current,e.g. how the
needs relate to current work attitudes and behavior, rather thanhow the needs
arise the need to be promoted in the first place?
EQUITY THEORY
This theory was propounded by J. Stacy Adams.
The theory proposes that people are motivated when their perceived inputs equal outputs.
People want to be treated fairly. If employees perceive organisational decisions and managerial actions to be unfair or unjust, they are likely to experience of anger, outrage and resentment.
EQUITY THEORY
Adams argues that when people gauge the fairness of their work outcomes relative to others any perceived inequity is a motivating state of mind.
Perceived inequity occurs when someone believes that the rewards received for their work contributions compare unfavorably to the rewards of other people for their work.
USING THE EQUITY THEORYEquity theory in practice can be difficult
Because you don’t know who the
employees referenced group is nor their
view of inputs and outcomes however
below are some general recommendations
Managers should be aware that equity is based on perception.
Rewards should be equitable.
High performance should be rewarded.
EQUITY THEORY CONT.
People compare what they receive with what others receive, for a perceived level of effort
Inequity exists if another person gets more for a given level of input
People get upset the more inequity there is
The more upset someone is, the harder he or she will work to restore ‘equity’
GOAL THEORY
Goal setting is a powerful way of motivating people, and of motivating yourself. The value of goal setting is so well recognized that entire management systems, like Management by Objectives, have goal setting basics incorporated within them.
In fact, goal setting theory is generally accepted as among the most valid and useful motivation theories in industrial and organizational psychology, human resource management, and organizational behavior.
Dr Edwin Locke's pioneered the research on goal setting andmotivation in the late 1960s.
In his 1968 article "Toward a Theory of Task Motivation andIncentives," he stated that employees were motivated by clear goalsand appropriate feedback.
Locke went on to say that working toward a goal provided a majorsource of motivation to actually reach the goal - which, in turn,improved performance.
Locke's research showed that there was a relationship betweenhow difficult and specific a goal was and people's performanceof a task.
He found that specific and difficult goals led to better taskperformance than vague or easy goals.
FIVE PRINCIPLES OF GOAL SETTING
To motivate, goals must have:
Clarity.
Challenge.
Commitment.
Feedback.
Task complexity.
UNIT SEVENORGANIZATIONAL POWER
ORGANIZATIONAL POWER DEFINITIONS
How can power be defined?
The ability to get someone to do something you want done or the ability to make things happen in the way you want them to.
The essence of power is control over the behavior of others.
influence is what you have when you exercise power.
A managers position power allows him to perform certain dutiesautomatically for the organization. E.g. reward, coercive,
legitimate, process, information.
Reward power is the extent to which a manager can useextrinsic and intrinsic rewards to control other people.Examples of such rewards include money, promotions,compliments, or enriched jobs.
Although all managers have some access to rewards,success in accessing and utilizing rewards to achieveinfluence varies according to the skills of the manager.
Power can also be founded on punishment instead of reward. Forexample, a manager may threaten to withhold a pay raise, or totransfer, demote, or even recommend the firing of a subordinatewho does not act as desired.
Such coercive power is the extent to which a manager can denydesires rewards or administer punishments to control otherpeople.
The presence of unions and organizational policies on employeetreatment can weaken this power base considerably.
The third base of “position” power is legitimate power, or formalhierarchical authority.
It stems from the extent to which a manager can use subordinate’internalized values or beliefs that the “boss” has a “right of command”to control their behavior.
Legitimate power represent a special kind of power amanager has because subordinates believe it is legitimatefor a person occupying the managerial position as theirboss to have right to command.
If this legitimacy is lost, authority will not be accepted bysubordinates
Process power is the control over methods of production andanalysis.
This source of this power is the placing of the individual in a positionto influence how inputs are transformed into outputs for the firm, adepartment in the firm, or even a small group.
Firms often establish process specialists who work with managers toinsure that production is processes used to make choices. Forexample, many organizations have other parts of the firm forinvestments.
Their power derives not from the calculation itself, but from theassignment separated from legitimate hierarchical power.
A manager may have the formal hierarchical authority to decide,but may be required to use the analytical schemes of othersand/or to consult on effective implementation with processspecialists.
This leads us to another related aspect of position power –the roleof the access to and control information.
Information power is the access to and/ or the control of information.
It is one of the most important aspects of legitimacy. The “right toknow” and use information can be, and often is, conferred on a positionholder.
Thus, information power may complement legitimate hierarchical power.Information power may also be granted to specialist and managerswho are in the middle of the information systems of the firm.
For example, the chief information officer of the firm maynot only control all the computers, but may also haveaccess to almost any information of the informationsystems of the computers, but may also have access toalmost any information desired.
For example, most chief executive officers believe theyhave the right to know about everything in “their” firm.Deeper in the organization, managers often protectinformation from others under the notion that outsiderswould not understand it.
Representative power is the formal right conferred by thefirm to speak as a representative for a potentiallyimportant group composed of individuals acrossdepartments or outside the firm.
Many of the constituencies are outside the firm. Theyinclude such groups as investors, customer, alliancepartners, and, of course, unions.
Astute executives often hire individuals to act asrepresentative of and to these constituencies to ensure thattheir influence is felt, but does not dominate.
PERSONAL POWER
Personal power resides in the individual and is independent of thatindividual’s position. Three bases of personal power are expertise,rational persuasion, and referent.
Expert power is ability to control another person’s behavior through thepossession of knowledge, experience, or judgment that the other persondoes not have but needs.
A subordinate obeys a supervisor possessing expert power because theboss knows more about what is to be done or how it is to be done thandoes the subordinate. Expert power is relative, not absolute.
Rational persuasion is the ability to control another’s behavior becausethrough the individual’s efforts, the person accepts the desirability of anoffered goal and reasonable way of achieving it.
Referent power is the ability to control another’s behavior because theperson wants to identify with the power source. In this case, asubordinate obeys the boss because he or she wants to behave,perceive, or believe as the boss does.
Such obedience is usually due to that boss-subordinate attempt to avoiddoing anything that would interferer with the pleasing boss-subordinaterelationship.
A person’s referent power can be enhanced when the individual tapin moral order or shows a clearer long-term path to a morallydesirable end.
In common language, individuals with the ability to tap into thesemore esoteric aspects of corporate life have “charisma” and “thevision thing”
ACQURING AND USING POWER AND INFLUENCE
Power-oriented behavior is action directed primarily atdeveloping or using relationships in which other peopleare to some degree willing to defer to one’s wishes.
This may be due to how the individual builds up his or her personal or position power.
BUILDING POSITION POWER
Position power can be enhanced when managers are able todemonstrate to others that their work units are:
highly relevant to organizational goals
able to respond to urgent organizational needs.
Managers may also attempt to increase the relevance of their tasksand those of their unit to the organization.
For example Executives may attempt to become an internalcoordinator within the firm or external representative, particularlywhen the firm is downsizing.
Again when the firm is in a dynamic setting of changingtechnology, the executive may also move to provide uniqueservices and information to other units.
This is particularly effective if the executive moves his unitinto becoming involved with decisions central to theorganization’s top-priority goals.
To expand their position, managers may also delegateroutine activities, expand the task variety and novelty forsubordinates, initiate new ideas, and get involved in newprojects.
There are also ways manager’s attempts to build influence that mayor may not have a positive effect on the organization.
For example managers may attempt to define tasks so that theyare difficult to evaluate.
some may be creating an ambiguous job description ordeveloping a unique language for their work.
BUILDING PERSONAL POWER
Personal power arises from the personal characteristics of themanager
Three personal characteristics, expertise, political savvy, andlikeability, have special potential for enhancing personal power inan organization.
Expertise being the most obvious may be gained by advancedtraining and education, participation in professional associations,and involvement in the early stages of projects.
BUILDING PERSONAL POWER
The novice believes that most individuals are very much the same, seethe same goals, and will accept much the same paths towards thesegoals. The more astute individual recognizes important individualdifferences.
A manager’s referent power is increased by characteristics thatenhance his or her likeability and create personal attraction inrelationships with other people.
These include pleasant personality characteristics, agreeablebehavior patterns, and attractive personal appearance.
BUILDING PERSONAL POWER
The demonstration of sincere hard work on behalf of taskperformance can also increase personal power by enhancingboth expertise and reference.
A person who is perceived to try hard may be expected toknow more about the job and thus sought out for advice.
A person who tries hard is also likely to be respected for theattempt and may even be depended on by others to maintainthat effort.
COMBINED BUILDING OF POSITION AND PERSONAL POWER
Most managers attempt to increase the visibility of their jobperformance by
Expanding the number of contracts they have with senior people
Making oral presentations of written work
Participating in problem-solving task forces
Sending out notices of accomplishment
Seeking additional opportunity to increase personal namerecognition.
Most managers also recognize that, between superiors and subordinates,access to control over information is an important element.
A boss may appear to expand his or her expert power over asubordinate by not allowing the individual access to critical information.
In a similar manner a supervisor may also control access to keyorganizational decision makers.
An individual’s ability to contact key persons informally can offset some ofthis disadvantage.
Expert power is often relational and embedded within theorganizational content.
Many important decisions are made outside formal channels and aresubstantially influenced by key individuals with the requisite knowledge.
By developing and using coalition and networks, an individual maybuild on his or her expert power.
Through coalition’s networks, an individual may alter the flow ofinformation and the context for analysis.
Developing coalitions and networks, executives also expand their accessto information and their opportunities for participation.
Executives who want to increase their power often make their goalsand needs clear show their power base directly but instead provideclear “rational persuasion” for their power
TURNING POWER INTO RELATIONAL INFLUENCE
Using position and personal power well to achieve the desired influence over other people is a challenge for most managers. The most common strategies involved the following
Reason using facts and data to support a logical argument.
Friendliness using flattery, goodwill, and favorable impression.
Coalition using relationships with other people for support.
TURNING POWER INTO RELATIONAL INFLUENCE
Bargaining: using the exchange of benefits as a basis for negotiation.
Assertiveness: using a direct and forceful personal approach.
Higher authority: Gaining higher-level support for one’s request.
Sanctions: using organizationally derived rewards and punishments.
Research on these strategies suggest that reason is the mostpopular strategy overall.
In addition, friendliness, assertiveness, bargaining, and higherauthority are used more frequently to influence subordinates thanto influence supervisors.
POWER, FORMAL AUTHORITY, AND OBEDIENCE
Power is the potential to control the behavior of others, and formalauthority is the potential to exert such control through the legitimacyof a managerial position.
Yet, we also know that people who seem to have power don’t alwaysget their way.
Why do some people obey directives and others do not? Morespecifically, why should subordinates respond to manager’s authority,or “right to command” in the first place?
Furthermore, given that subordinates are willing to obey, whatdetermine the limits of obedience?
The answer to this question can be found in the work by thefamous management writer Chester Bernard’s argument whichfocused on the “consent of the governed” rather than on therights derived from ownership.
He argued that if subordinates accepted or followed adirective these circumstances must be met:
(1) the subordinate can and must understand the directive;
(2) the subordinate must feel mentally and physicallycapable of carrying out the directive
;(3) the subordinate must be believe that the directive isnot inconsistent with the purpose of the organization; and
(4) the subordinate must believe that the directive is notinconsistent with his or her personal interest.
These four conditions are very carefully stated. For instance, toaccept and follow an order, the subordinate does not need tounderstand how the proposed action will help the organization.
He or she only needs to believe that the requested action is notinconsistent with the purpose of the firm. The astute manager willnot take these guidelines for granted. In giving directive, theastute manager recognizes that the acceptance of the request isnot assured.
Obedience and the Zone of Indifference Most people seek abalance between what they put into an organization(contributions) and what they get from an organization in return(inducements.
Within the boundaries of the psychological contract, therefore,employees will agree to do many things in and for theorganization because they think they should. In exchange forcertain inducements, subordinates recognize the authority of theorganization and its managers to direct their behavior in certainways.
Based on his acceptance view of authority, Chester Bernard callsthis area in which this area in which directions are obeyed the“zone of indifference”
A zone of indifference is the range of authoritative requests towhich a subordinate is willing to respond without subjecting thedirectives to critical evaluation or judgment.
Directives falling within the zone are obeyed. Request or ordersfalling outside the zone of indifference are not consideredlegitimate under terms of the psychological contract. Such“extraordinary” directives may or may not be obeyed.
The zone of indifference is not fixed. There may be times when aboss would like a subordinate to do things falling outside thezone.
In this case, the manager must enlarge the zone to accommodateadditional behaviors.
In these attempts, a manager most likely will have to use moreincentive than pure position power. When will you say “No” toyour boss? When should you be willing to say “No”? At times, thesituation may involve ethical dilemmas, where you may be askedto do things that are illegal, unethical, or both.
Research on ethical managerial behavior shows that supervisorscan become sources of pressure for subordinates to do suchthings as support incorrect viewpoints, sign false documents,overlook the supervisor’s wrongdoing, and , and do businesswith the supervisor’s friends. Most of us will occasionally faceethnical dilemmas during our careers.
For now, we must simply remember that saying “No” or refusingto keep quiet can be difficult and potentially costly.
END OF UNIT
UNIT EIGHTORGANIZATIONAL COMMUNICATION
LESSON SEVEN
By the end of the lesson students should be able to:
Explain the concept of communication
Explain the process of communication
Describe the routes to communication
Suggest ways to communicate effectively at the workplace.
THE MANAGER AND COMMUNICATION
Managers are at the centre of communication asfacilitators of strategic communication.
Communication is purpose directed and has methods ofcommunication.
THE MANAGER AS A COMMUNICATION CHAMPION.Purp
ose
Dir
ect
ed
Vision
Values
Desired Outcomes
Influence Employees
Behaviour Str
ate
gic
Conv
ers
ation Open
Communication
Listening
Dialogue
Feedback
Meth
ods Rich Channels
Upward, downward, and Horizontal channels Non-verbal Communication
Personal Networks
WHAT IS COMMUNICATION?
•Communication is the transfer of a message from the sender to thereceiver, who understands the message.
•People within all organizations need to communicate becausewithout communication, we would all be working as individualswith no links with anybody else.
PROCESS CONTINUED
SENDER
ENCODESRECEIVER
DECODECHANNEL
Return message decoded Feedback Loop Return message encoded
NOISE
Conceiving the message
Decoding the message
Selecting the communication channel
Encoding the message
Interpreting the message
Feedback.
COMMUNICATION MEDIA
Information can be transmitted in various forms, these are; Verbal, non- verbal and written
One to one talks between the sender and the receiver.
Telephone Mobile phone conversation
Video/Tele conferencing
meeting
presentations
Seminars
Briefings
Voice-mail/answer phone
The non-verbal communication involves
1 facial expression,
2 body gesture and positioning,
Movement
Stance
Written forms of communication involves
Letter ,Memo , Reports, Minutes, Mail-merge, Email messages Text Faxed and telexed
TOOLS FOR COMMUNICATION
Voice
Graphics
PC Posters
Face Bulletin Boards
Body view Foils
Fax Machine Slides
Video Recorder Stationery
Audio Cassette
COMMUNICATION TOOLS
CHANNELS OF COMMUNICATION
In a developed organization, communication flows down, up, andacross, from boardroom to shop floor and back, betweendepartmental managers or between sales assistants. They mayalso move diagonally between different levels.
DOWNWARD COMMUNICATION
Downward is a term used to describe the principal channel forrouting directives, instructions and policies from decision makersdown through the organization to the people who, at various levelswill implement these.
The chain of command determines the flow of information. Asmessages move downward through successive levels of theorganization, they seem to get larger. At times as message passesthrough various levels, it often becomes less accurate (especially if itis oral).
UPWARD COMMUNICATION
The upward route starts at the lower level to the top of theorganization.
Generally, it is feedback to downward communication. So, messagesfollowing in this direction tend to contain the information managersneed to do their jobs such as data required for decision making andthe status of various projects.
When managers requests information from lower levels of theorganization, the resulting information helps management to judge theeffectiveness of its downward communication and to help learn aboutorganizational problems.
DIAGONAL COMMUNICATION
The Diagonal route of communication in an organization is the onethat cut across departments where the communication is between asuperior and a subordinate, in either direction but not accordingto the actual chain of command as prescribed by theorganizational chart.
Frequently tasks arise in organizations which call for this. Forexample, a middle-manager may require a service or a job to beperformed and he might have to deal with a colleague moresenior to him, in another department and if the colleague is juniorto him, he still will not report to him, and may therefore be underfewer obligations.
Diagonal communication therefore relies heavily onreservoirs of co-operation and good-will which theproficient communicator has carefully nurtured by way ofthe friendly greetings or brief chats with colleagues on hisjourneys through the company’s offices (Evans, 1990).
MAJOR FACTORS INFLUENCING COMMUNICATION CHANNELS IN ORGANIZATIONS
In an organization, communication routes are influenced by many factors including organization structure, groups (i.e. formal networks of communication) and individuals (i.e. informal network between people).
The Organizational Structure formally presents a pattern of communication between individuals and responsibility blocks.
These are relatively fixed and defined with lines ofauthority showing who must answer to whom. At thesame time people are also responsible for those whoare immediately below them.
The organizational chart forms a sort of blue print ofan organization showing not only what people have todo, but with whom they have to communicate, for theorganization to operate properly.
Establishing such formal communication channels tocritical where companies are very large.
GENERAL IDEAS FOR IMPROVING COMMUNICATION EFFECTIVENESS IN ORGANISATIONS
Study people as individuals: As you have seen in thecommunication process a person’s response to yourcommunication depends on his or her perception of themessage you transmit. It is therefore important to watchyour perception of someone’s communication as it mayinfluence your interpretation.
QUESTION FOR DISCUSSION
How effective should communication be within organizations ?
UNIT NINE :DECISION MAKING IN
MANAGEMENT
A decision making arises when there are differentthings managers can do but has to pick one ofthem
Decision making is a process
THE DECISION MAKING PROCESS
Recognize the need for a decision
Frame the problem
Generate and assess alternatives
Choose among alternatives
Implement chosen alternative
Learn from the feedback
DECISION MAKING STEPS
1. Recognize need for a decision: Managers must first realize that a decision must be made.
Sparked by an event such as environment changes.
2. Generate alternatives: managers must develop feasible alternative courses of action.
If good alternatives are missed, the resulting decision is poor.
It is hard to develop creative alternatives, so managers need to look for new ideas.
3. Evaluate alternatives: what are the advantages and disadvantages of each alternative?
Managers should specify criteria, then evaluate.
DECISION MAKING STEPS
4. Choose among alternatives: managers rank alternatives anddecide.
When ranking, all information needs to be considered.
5. Implement choose alternative: managers must now carry out thealternative.
Often a decision is made and not implemented.
6. Learn from feedback: managers should consider what wentright and wrong with the decision and learn for the future.
Without feedback, managers never learn from experienceand make the same mistake over.
EVALUATING ALTERNATIVES
Legal?
Ethical
Economical?
Practical?
Is the possible course of action:Figure 6.5
EVALUATING ALTERNATIVES
Is it legal? Managers must first be sure that analternative is legal both in this country and abroad forexports.
Is it ethical? The alternative must be ethical and not hurtstakeholders unnecessarily.
Is it economically feasible? Can our organization’sperformance goals sustain this alternative?
Is it practical? Does the management have thecapabilities and resources to do it?
COGNITIVE BIASESSuggests decision makers use heuristics to deal with bounded rationality.
A heuristic is a rule of thumb to deal with complex situations.
If the heuristic is wrong, however, then poor decisions result from its use.
Systematic errors can result from use of an incorrect heuristic.
These errors will appear over and over since the rule used to make decision is flawed.
UNIT TEN:CHANGE MANAGEMENT
STRATEGIC CHANGE
Change can be transformational or incremental.
Transformational change is extensive and crucial to the organisation.
An incremental change takes time to evolve.
Change occurs within the environment.
Strategy is seen as adapting the organisation to changes in theenvironment.
MANAGEMENT APPROACH TO CHANGE M
an
agem
ent
Role
s
Pro
acti
ve
Tuning Planned
Re
acti
ve
Adaptation Forced
Incremental Transformational
The Nature of Change
NATURE OF CHANGE
Proactive management is where organisations undertake change before events impose change on them.
This is where the organisation is responsive to its environment.
Any organisation that does not take proactive approach to change finds itself battling with forced change which is painful and risky.
NATURE OF CHANGEDrivers of change are both external and internal.
External factors could be analysed using PEST (Political, Economic, Social and Technological) or PESTLE (Political, Economic, Social, Technological, Legal and Ecological) approach.
Internal factors of change include technical, administrative, financial etc.
THE EFFECT OF CHANGE ON INDIVIDUALS
People are disoriented in adapting to change.
People are uncertain about the changes and therefore insecure
Some people are stressful in their new roles because of new challenges and pressures.
Change causes people to be threatened especially when it is an outside force which is uncontrollable.
SOURCES OF RESISTANCE TO CHANGE
Attitude or beliefs which are the results of culture, religion etc.
Loyalty to group norms
Habit and past norms
Politics- resistance to change that attempts to weaken one’s position or increase rival’s position.
The way change is implemented-if employees were not involved.
Personality- our personalities affect our attitude to change.
IMMEDIATE CAUSES OF RESISTANCE TO CHANGE
Self-interest – where the old ways of doing things favours somebody.
Lack of communication – where the nature and consequences of change have not been made known and clear to employees
Contradictory assessment-where management and labour do not see the cost and benefit of change in the same way.
Low tolerance – some people do not tolerate any form of change.
THE IMMEDIATE CAUSES OF RESISTANCE TO CHANGE
Acceptance – whether enthusiastic espousal, co-operation,grudging co-operation or resignation
Indifference – usually where the change does not affectthe individual; evidence is apathy, lack of interest, inactionetc
Passive resistance – refusal to learn, pleas of ignorance ordefensiveness; procrastination
Active resistance – deliberate ‘spoiling’, go slow,deliberate errors, absenteeism or strikes.
STRATEGIES FOR CHANGE MANAGEMENT
Cause of resistance How to deal with it
Parochial self-interest Negotiation- for example offering incentives to those resisting
change on ground of self interest.
Misunderstanding This is best dealt with by educating and reassuring people.
Trust has to be earned.
Different viewpoints of the
situation
Change can be promoted through participation and by
involving potential resisters
Low tolerance Force the change through and then support the new
behaviour it requires. In short, people need to be encouraged
to adopt the new behaviour.
OVERCOMING RESISTANCE TO CHANGE
When dealing with resistance to change, managers should consider three aspects of change. Pace of the change, manner of the change and the scope of the change
Pace of change
The more gradual the change, the more time is available for questions to be asked, reassurance to be given and retraining (where necessary) embarked upon.
Presenting the individual with a fait accompli (Let’s get it over with-people just have to get used to it) may short-circuit resistance at the planning and immediate implementation stage. It may however, cause problems later.
OVERCOMING RESISTANCE TO CHANGE-THE MANNER OF CHANGE
The manner in which a change is put across is very important.
Confront resistance- Talking through areas of conflict may lead to useful insight and the adapting of the programme of change to advantage.
Keep people informed- Information should be sensible, clear, consistent and realistic.
Explanation- The change can be sold to the people by convincing them that their attitudes and behaviour need changing.
Skills training- Learning programmes for any new skills or systems necessary will have to be designed according to the abilities, previous learning experience etc of the individual concerned.
Empathy- Getting to know the people involved in and affected by changes enables their reactions to be anticipated.
OVERCOMING RESISTANCE TO CHANGE-SCOPE OF CHANGE
Total transformation will create greater insecurity but also greaterexcitement, if the organisation has the kind of innovative culture thatcan stand it than moderate innovation.
There may be hidden changes to take into account: a change intechnology may necessitate changes in work methods, which may inturn result in the breaking up of work groups.
Management should be aware of how many different aspects of theiremployees’ lives they are proposing to alter and therefore on howmany fronts they are likely to encounter resistance.
LEWIN'S "FIELD FORCE" MODEL OF CHANGE
DRIVING FORCES:
•Pressures for change
Degree of change:
•Individual•Group•Organization
RESTRAINING FORCES:
•Pressures resisting change
LEWIN'S THREE STAGE MODEL: UNFREEZING
Unfreezing:
Getting managers to accept the desirability and feasibility of change.
gathering information about the culture of the organisationsurveys, interviews, observation.
making the culture explicit and forcing managers to recognise it · benchmarking against other, better performing organisations. The use of outsiders such as consultants is particularly important at this stage, since they are not part of the culture.
LEWIN'S THREE STAGE MODEL
➢Moving:
Shifting culture in the desired direction.
HRM-The change has to be supported by changes in appraisal and reward systems, training, and recruitment and selection criteria. There may also be the need to change personnel.
Communications of the need for, nature of and benefits of the change, and of top management backing.
Leadership, particularly the example and involvement of top management
➢Refreezing:
Monitoring the change process and making sure that the changes are maintained and consolidated
KOTTER’S 8 STEPS IN TRANSFORMING ORGANIZATIONS
1. Establish a sense of urgency amongst members
2. Form a coalition of supporters to guide the changes
3. Create a vision of a better future
4. Communicate the vision to those involved in the change
5. Empower people to act on the vision and support them
6. Create short term wins based on "milestone" achievements
7. Consolidate improvements as a basis for further change
8. Institutionalize the changes by making them part of the structureand systems of the organization.
CHANGE AND CULTURE Culture is difficult to change because it is:
Collective: implying group or community based change
Tacit: implying that part of the change process must to be make the culture explicit.
Historic: it takes time to develop, it takes time to change.
Web-like: As Johnson and Scholes point out, culture is contained in a web of activities that reinforce one another.
Exists at different levels: it is easier to change behaviour than attitudes and almost impossible to change beliefs.
END OF COURSE