Who Are Managers?A manager is someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals. That may mean coordinating the work of a departmental group, or it might mean supervising a single person. It could involve coordinating the work activities of a team composed of people from several different departments or even people outside the organization such as temporary employees or employees who work for the organization's suppliers.

Classification of ManagersFor traditionally structured organizations—that is, those organizations in which the number of employees is greater at the bottom than at the top (shaped like a pyramid) managers are classified as first-line, middle, or top.First-line managers are the lowest level of management and manage the work of non-managerial individuals who are involved with the production or creation of the organization's products. They're often called supervisors but may also be called line managers, office managers, or even foremen. Middle managers include all levels of management between the first-line level and the top level of the organization. These managers manage the work of first-line managers and may have titles such as department head, project leader, plant manager, or division manager. At or near the top of the organization are the top managers, who are responsible for making organization-wide decisions and establishing the plans and goals that affect the entire organization. These individuals typically have titles such as executive vice president, president, managing director, chief operating officer, chief executive officer, or chairman of the board.

CEO

CORPORATE OR GROUP HEAD

VICE PRESIDENT OF ADMINSTRATIONBUSSINESS UNIT

HEADGENERAL

MANAGERS ADMINISTRAT

ORS DEPARTMENT

MANAGERSPRODUCT LINE OR SERVICE MANAGER

INFORMATION SERVICE MANAGER

FUNCTIONAL HEADS

NONMANAGERIAL EMPLOYEES

PRODUCTION, SALES, R&D SUPERVISOR

IT, HRM, ACCOUNTING SUPERVISOR

LINE JOBS STAFF JOBS

TOP MANGERS

MIDDLE MANAGERS

FIRST LINE MANAGERS

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What is Management?Management is a process of coordinating work activities so that they are completed efficiently and effectively with and through other people.The process represents the ongoing functions or primary activities engaged in by managers. These functions are typically labeled planning, organizing, leading, and controlling.Management involves the efficient and effective completion of organizational work activities, or at least that's what managers aspire to do.Efficiency refers to getting the most output from the least amount of inputs. Because managers deal with scarce inputs—including resources such as people, money, and equipment—they are concerned with the efficient use of those resources. From this perspective, efficiency is often referred to as "doing things right"—that is, not wasting resources. However, it's not enough just to be efficient. Management is also concerned with being effective, completing activities so that organizational goals are attained. Effectiveness is often described as "doing the right things"—that is, those work activities that will help the organization reach its goals. Management is concerned, then, not only with getting activities completed and meeting organizational goals (effectiveness) but also with doing so as efficiently as possible. In successful organizations, high efficiency and high effectiveness typically go hand in hand. Poor management is most often due to both inefficiency and ineffectiveness or to effectiveness achieved through inefficiency.

Management Functions and ProcessThe management functions have been condensed down to four basic and very important functions: planning, organizing, leading, and controlling. Let's briefly define what each of these management functions encompasses.The planning function involves the process of defining goals, establishing strategies for achieving those goals, and developing plans to integrate and coordinate activities.Managers are also responsible for arranging work to accomplish the organization's goals. We call this function organizing. It involves the process of determining what tasks are to be done, who is to do them, how the tasks are to be grouped, who reports to whom, and where decisions are to be made.Every organization includes people, and management's job is to work with and through people to accomplish organizational goals. This is the leading function. When managers motivate subordinates, influence individuals or teams as they work, select the most effective communication channel, or deal in any way with employee behavior issues, they are leading.The final management function managers perform is controlling. After the goals are set and the plans are formulated (planning), the structural arrangements determined (organizing), and the people hired, trained, and motivated (leading), there has to be some evaluation of whether things are going as planned. To ensure that work is going as it should, managers must monitor and evaluate

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performance. Actual performance must be compared with the previously set goals. If there are any significant deviations, it's management's job to get work performance back on track. This process of monitoring, comparing, and correcting is what we mean by the controlling function.

Management SkillsManagers need three essential skills or competencies.Technical skills include knowledge of and proficiency in a certain specialized field, such as engineering, computers, accounting, or manufacturing. These skills are more important at lower levels of management since these managers are dealing directly with employees doing the organization's work. Human skills involve the ability to work well with other people both individually and in a group. Because managers deal directly with people, this skill is crucial! Managers with good human skills are able to get the best out of their people. They know how to communicate, motivate, lead, and inspire enthusiasm and trust. These skills are equally important at all levels of management. Conceptual skills are the skills managers must have to think and to conceptualize about abstract and complex situations. Using these skills, managers must be able to see the organization as a whole, understand the relationships among various subunits, and visualize how the organization fits into its broader environment. These skills are most important at the top management levels. Below diagram shows the relationship of these skills and the levels of management.

Conceptual Skills Human Skills Technical skills

Top ManagersMiddle ManagersFirst-Line ManagersNonman

agers

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Management RolesHenry Mintzberg, a prominent management researcher, says that what managers do can best be described by looking at the roles they play at work. From his study of actual managers at work, Mintzberg developed a categorization scheme for defining what managers do. He concluded that managers perform 10 different but highly interrelated roles. The term management roles refers to specific categories of managerial behavior. As shown below, Mintzberg's 10 managerial roles can be grouped as those primarily concerned with interpersonal relationships, the transfer of information, and decision making.

CATEGORY ROLE ACTIVITY

INFORMATIONAL MONITOR DISSEMENATOR SPOKEPERSON

Seek and receive information, scan periodicals and reports, maintain personal contacts.Forward information to other organizational members, send memos and reports, make phone calls.Transmit information to outsiders through speeches, reports and memos

INTERPERSONAL FIGUREHEAD LEADER LIAISON

Perform ceremonial and symbolic duties such as greeting visitors, signing legal documents.Direct and motivate subordinates, train, counsel, and communicates with subordinates.Maintain information links both inside and outside the organization; use emails, phone calls and meetings.

DECISIONAL ENTERPRENUER DISTURBANCE

HANDLER RESOURCES

ALLOCATOR NEGOTIATOR

Initiates improvement projects, identify new ideas, delegate idea responsibility to othersTake corrective actions during disputes or crises, resolves conflictsDecide who gets resources, schedule, budget and set prioritiesRepresent department during negotiation of union contracts, sales, purchases, budgets, represents departmental interests.

What Is an Organization? An organization is a deliberate arrangement of people to accomplish some specific purpose. These are all organizations because they all share three common characteristics as shown

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First, each organization has a distinct purpose. This purpose is typically expressed in terms of a goal or a set of goals that the organization hopes to accomplish. Second, each organization is composed of people. One person working alone is not an organization, and it takes people to perform the work that's necessary for the organization to achieve its goals. Third, all organizations develop some deliberate structure so that their members can do their work.

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Historical Background of ManagementOrganized endeavors directed by people responsible for planning, organizing, leading, and controlling activities have existed for thousands of years. The Egyptian pyramids and the Great Wall of China, for instance, are tangible evidence that projects of tremendous scope, employing tens of thousands of people, were undertaken well before modern times. The pyramids are a particularly interesting example. The construction of a single pyramid occupied more than 100,000 workers for 20 years.Who told each worker what to do? Who ensured that there would be enough stones at the site to keep workers busy? The answer to such questions is managers. Regardless of what managers were called at the time, someone had to plan what was to be done, organize people and materials to do it, lead and direct the workers, and impose some controls to ensure that everything was done as planned.Another example of early management can be seen during the 1400s in the city of Venice, Italy, a major economic and trade center. The Venetians developed an early form of business enterprise and engaged in many activities common to today's organizations. For instance, at the arsenal of Venice, warships were floated along the canals and at each stop materials and riggings were added to the ship. Doesn't that sound a lot like a car "floating" along an automobile assembly line and components being added to it? In addition to this assembly line, the Venetians also had a warehouse and inventory system to monitor its contents, personnel (human resource management) functions required to manage the labor force, and an accounting system to keep track of revenues and costs.Two pre-twentieth-century events played particularly significant roles in promoting the study of management. First, in 1776, Adam Smith published a classical economics doctrine, The Wealth of Nations, in which he argued the economic advantages that organizations and society would gain from the division of labor, the breakdown of jobs into narrow and repetitive tasks.The second, and possibly most important, pre-twentieth-century influence on management was the Industrial Revolution.The major contribution of the Industrial Revolution was the substitution of machine power for human power, which, in turn, made it more economical to manufacture goods in factories rather than at home. These large, efficient factories using power-driven equipment required managerial skills. Why? Managers were needed to forecast demand, ensure that enough material was on hand to make products, assign tasks to people, direct daily activities, coordinate the various tasks, ensure that the machines were kept in good working condition and work standards were maintained, find markets for the finished products, and so forth. Planning, organizing, leading, and controlling became necessary, and the development of large corporations would require formal management practices. The need for a formal theory to guide managers in running these organizations had arrived.The development of management theories has been characterized by differing beliefs about what managers do and how they should do it. In the next sections

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we present the contributions of four approaches. Scientific management looked at management from the perspective of improving the productivity and efficiency of manual workers. General administrative theorists were concerned with the overall organization and how to make it more effective. Then a group of theorists focused on developing and applying quantitative models to management practices. Finally, a group of researchers emphasized human behavior in organizations, or the "people" side of management.

Development of Major Management Theories

Scientific ManagementIn 1911, Frederick Winslow Taylor's Principles of Scientific Management was published. Its contents became widely accepted by managers around the world. The book described the theory of scientific management: the use of scientific methods to define the "one best way" for a job to be done

Important ContributionsImportant contributions to scientific management theory were made by Frederick W. Taylor and Frank and Lillian Gilbreth.

Frederick W. TaylorTaylor did most of his work at the Midvale and Bethlehem Steel Companies in Pennsylvania. As a mechanical engineer, he was continually appalled by workers' inefficiencies. Employees used vastly different techniques to do the same job. They were inclined to "take it easy" on the job, and Taylor believed

Contemporary Approaches

Behavioral Approaches

Quantitative Approaches

Classical Approaches

Historical Background

Industrial Revolution

Adam Smith

Early Examples of Management

Scientific ManagementGeneral Administrative

Systems Approach

Early Advocates

Hawthorne Studies

Organizational Behavior

Contingency Approach

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that worker output was only about one-third of what was possible. Virtually no work standards existed. Workers were placed in jobs with little or no concern for matching their abilities and aptitudes with the tasks they were required to do. Managers and workers were in continual conflict. He set out to correct the situation by applying the scientific method to shop floor jobs. He spent more than two decades passionately pursuing the "one best way" for each job to be done.Probably the best known example of Taylor's scientific management was the pig iron experiment. Workers loaded "pigs" of iron (each weighing 92 pounds) onto rail cars. Their daily average output was 12.5 tons. However, Taylor believed that by scientifically analyzing the job to determine the "one best way" to load pig iron, output could be increased to 47 or 48 tons per day. After scientifically trying different combinations of procedures, techniques, and tools, Taylor succeeded in getting that level of productivity. How? He put the right person on the job with the correct tools and equipment, had the worker follow his instructions exactly, and motivated the worker with an economic incentive of a significantly higher daily wage. Using similar approaches to other jobs, Taylor was able to define the "one best way" for doing each job. Overall, Taylor achieved consistent productivity improvements in the range of 200 percent or more. Through his groundbreaking studies of manual work using scientific principles, Taylor became known as the "father" of scientific management.

Frank and Lillian GilbrethA construction contractor by trade, Frank Gilbreth gave up his contracting career in 1912 to study scientific management after hearing Taylor speak at a professional meeting. Frank and his wife Lillian, a psychologist, studied work to eliminate wasteful hand-and-body motions. The Gilbreths also experimented with the design and use of the proper tools and equipment for optimizing work performance.Frank is probably best known for his experiments in bricklaying. By carefully analyzing the bricklayer's job, he reduced the number of motions in laying exterior brick from 18 to about 5, and on laying interior brick the motions were reduced from 18 to 2. Using Gilbreth's techniques, the bricklayer could be more productive and less fatigued at the end of the day.The Gilbreths were among the first researchers to use motion pictures to study hand-and-body motions. They invented a device called a microchronometer that recorded a worker's motions and the amount of time spent doing each motion. Wasted motions missed by the naked eye could be identified and eliminated. The Gilbreths also devised a classification scheme to label 17 basic hand motions (such as search, grasp, hold), which they called therbligs (Gilbreth spelled backward with the th transposed). This scheme allowed the Gilbreths a more precise way of analyzing a worker's exact hand movements.

General Administrative TheoristsAnother group of writers looked at the subject of management but focused on the entire organization, called as general administrative theorists. They developed more general theories of what managers do and what constituted good management practice.

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Important ContributionsThe two most prominent theorists behind the general administrative approach were Henri Fayol and Max Weber.

Henri FayolFayol, described management as a universal set of functions that included planning, organizing, commanding, coordinating, and controlling. Fayol wrote during the same time period as Taylor. While Taylor was concerned with management at the lowest organizational level and used the scientific method, Fayol's attention was directed at the activities of all managers. He wrote from personal experience as a practitioner since he was the managing director of a large French coal-mining firm. Fayol described the practice of management as something distinct from accounting, finance, production, distribution, and other typical business functions. He argued that management was an activity common to all human endeavors in business, government, and even in the home. He then proceeded to state 14 principles of management—fundamental rules of management that could be taught in schools and applied in all organizational situations. These principles are shown below,1. Division of work. Specialization increases output by making employees

more efficient.2. Authority. Managers must be able to give orders. Authority gives them

this right. Along with authority, however, goes responsibility.3. Discipline. Employees must obey and respect the rules that govern the

organization.4. Unity of command. Every employee should receive orders from only one

superior.5. Unity of direction. The organization should have a single plan of action to

guide managers and workers.6. Subordination of individual interests to the general interest. The interests

of any one employee or group of employees should not take precedence over the interests of the organization as a whole.

7. Remuneration. Workers must be paid a fair wage for their services.8. Centralization. This term refers to the degree to which subordinates are

involved in decision making.9. Scalar chain. The line of authority from top management to the lowest

ranks is the scalar chain.10. Order. People and materials should be in the right place at the right time.11. Equity. Managers should be kind and fair to their subordinates.12. Stability of tenure of personnel. Management should provide orderly

personnel planning and ensure that replacements are available to fill vacancies.

13. Initiative. Employees who are allowed to originate and carry out plans will exert high levels of effort.

14. Esprit de corps. Promoting team spirit will build harmony and unity within the organization.

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Max WeberWeber (pronounced VAY-ber) was a German sociologist who studied organizational activity. Writing in the early 1900s, he developed a theory of authority structures and relations. Weber described an ideal type of organization he called a bureaucracy—a form of organization characterized by division of labor, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationships. Weber recognized that this "ideal bureaucracy" didn't exist in reality. Instead he intended it as a basis for theorizing about work and how work could be done in large groups. His theory became the model structural design for many of today's large organizations. The features of Weber's ideal bureaucratic structure are outlined as follows,

Quantitative Approach to Management The quantitative approach involves the use of quantitative techniques to improve decision making. This approach has also been labeled operations research or management science.Important ContributionsThe quantitative approach evolved out of the development of mathematical and statistical solutions to military problems during World War II. After the war was over, many of the techniques that had been used for military problems were applied to the business sector. One group of military officers, nicknamed the

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Whiz Kids, joined Ford Motor Company in the mid-1940s and immediately began using statistical methods and quantitative models to improve decision making. What exactly does the quantitative approach do? This approach to management involves applications of statistics, optimization models, information models, and computer simulations to management activities. Linear programming, for instance, is a technique that managers use to improve resource allocation decisions. Work scheduling can be more efficient as a result of critical-path scheduling analysis. Decisions on determining a company's optimum inventory levels have been significantly influenced by the economic order quantity model. Each of these is an example of quantitative techniques being applied to improve managerial decision making.

Understanding Organizational BehaviorAs we know, managers get things done by working with people. This explains why some writers and researchers have chosen to look at management by focusing on the organization's human resources. The field of study concerned with the actions (behavior) of people at work is called organizational behavior (OB). Much of what currently makes up the field of human resources management and contemporary views on motivation, leadership, trust, teamwork, and conflict management have come out of organizational behavior research.Early AdvocatesAlthough there were a number of people in the late 1800s and early 1900s who recognized the importance of the human factor to an organization's success, four individuals stand out as early advocates of the OB approach. They are Robert Owen, Hugo Munsterberg, Mary Parker Follett, and Chester Barnard. The contributions of these individuals were varied and distinct, yet they all had in common a belief that people were the most important asset of the organization and should be managed accordingly. Their ideas provided the foundation for such management practices as employee selection procedures, employee motivation programs, employee work teams, and organization-external environment management techniques. Below is the summary of most important ideas of these early advocates

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The Hawthorne StudiesWithout question, the most important contribution to the developing OB field came out of the Hawthorne Studies, a series of studies conducted at the Western Electric Company Works in Cicero, Illinois. These studies, started in 1924 and continued through the early 1930s, were initially designed by Western Electric industrial engineers as a scientific management experiment. They wanted to examine the effect of various illumination levels on worker productivity. Control and experimental groups were set up with the experimental group being exposed to various lighting intensities, and the control group working under a constant intensity. If you were one of the industrial engineers in charge of this experiment, what would you have expected to happen? That individual output in the experimental group would be directly related to the intensity of the light? Seems perfectly logical, doesn't it? However, they found that as the level of light was increased in the experimental group, output for both groups increased. Then, much to the surprise of the engineers, as the light level was decreased in the experimental group, productivity continued to increase in both groups. In fact, a productivity decrease was observed in the experimental group only when the level of light was reduced to that of a moonlit night. What would explain these unexpected results? The engineers couldn't explain what they had witnessed but concluded that illumination intensity was not directly related to group productivity, and that something else must have contributed to the results. However, they weren't able to pinpoint what that "something else" was.In 1927, the Western Electric engineers asked Harvard professor Elton Mayo and his associates to join the study as consultants. Thus began a relationship that would last through 1932 and encompass numerous experiments in the redesign of jobs, changes in workday and workweek length, introduction of rest periods, and individual versus group wage plans. For example, one experiment was designed to evaluate the effect of a group piecework incentive pay system on group productivity. The results indicated that the incentive plan had less effect on a worker's output than did group pressure, acceptance, and the accompanying security. The researchers concluded that social norms or group standards were the key determinants of individual work behavior.Scholars generally agree that the Hawthorne Studies had a dramatic impact on the direction of management beliefs about the role of human behavior in organizations. Mayo concluded that behavior and sentiments are closely related, that group influences significantly affect individual behavior, that group standards establish individual worker output, and that money is less a factor in determining output than are group standards, group sentiments, and security. These conclusions led to a new emphasis on the human behavior factor in the functioning of organizations and the attainment of their goals.However, the conclusions from the Hawthorne Studies weren't without criticism. Critics attacked the research procedures, analyses of findings, and the conclusions. From a historical standpoint, however, it's of little importance whether the studies were academically sound or their conclusions justified. What is important is that they stimulated an interest in human behavior in organizations. The Hawthorne Studies played a significant role in changing the

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dominant view at the time that employees were no different from any other machines that the organization used.

Current Trends and Issues

Where are we today? What current management concepts and practices are shaping "tomorrow's history"? In this section, we'll attempt to answer those questions by introducing several trends and issues that we believe are changing the way managers do their jobs: globalization, workforce diversity, entrepreneurship, managing in an e-business world, need for innovation and flexibility, quality management, learning organizations and knowledge management, and workplace spirituality. Throughout the text we focus more closely on many of these themes in various boxes, examples, and exercises included in each chapter.GlobalizationManagement is no longer constrained by national borders. BMW, a German firm, builds cars in South Carolina. McDonald's, a U.S. firm, sells hamburgers in China. Toyota, a Japanese firm, makes cars in Kentucky. Australia's leading real estate company, Lend Lease Corporation, built the Bluewater shopping complex in Kent, England, and has contracts with Coca-Cola to build all the soft-drink maker's bottling plants in Southeast Asia. Swiss company ABB Ltd. has constructed power generating plants in Malaysia, South Korea, China, and Indonesia. The world has definitely become a global village!Managers in organizations of all sizes and types around the world are faced with the opportunities and challenges of operating in a global market..Workforce DiversityOne of the major challenges facing managers in the twenty-first century will be coordinating work efforts of diverse organizational members in accomplishing organizational goals. Today's organizations are characterized by workforce diversity—a workforce that's more heterogeneous in terms of gender, race, ethnicity, age, and other characteristics that reflect differences. Workforce diversity is an issue facing managers of organizations in Japan, Australia, Germany, Italy, and other countries. For instance, as the level of immigration increases in Italy, the number of women entering the workforce rises in Japan, and the population ages in Germany, managers are finding they need to effectively manage diversity.Does the fact that workforce diversity is a current issue facing managers mean that organizations weren't diverse before? No. They were, but diverse individuals made up a small percentage of the workforce, and organizations, for the most part, ignored the issue. We assumed that people who were "different" would somehow automatically want to assimilate. But we now recognize that employees don't set aside their cultural values and lifestyle preferences when they come to work. The challenge for managers, therefore, is to make their organizations more accommodating to diverse groups of people by addressing different lifestyles, family needs, and work styles. The melting pot assumption has been replaced by the recognition and celebration of differences. Smart

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managers recognize that diversity can be an asset because it brings a broad range of viewpoints and problem-solving skills to a company. An organization that uses all of its human resources will enjoy a powerful competitive advantage. EntrepreneurshipEntrepreneurship is the process whereby an individual or a group of individuals uses organized efforts and means to pursue opportunities to create value and grow by fulfilling wants and needs through innovation and uniqueness, no matter what resources are currently controlled. It involves the discovery of opportunities and the resources to exploit them. Three important themes stick out in this definition of entrepreneurship. First is the pursuit of opportunities. Entrepreneurship is about pursuing environmental trends and changes that no one else has seen or paid attention to.The second important theme in entrepreneurship is innovation. Entrepre-neurship involves changing, revolutionizing, transforming, and introducing new approaches—that is, new products or services or new ways of doing business.The final important theme in entrepreneurship is growth. Entrepreneurs pursue growth. They are not content to stay small or to stay the same in size. Entrepreneurs want their businesses to grow and work very hard to pursue growth as they continually look for trends and continue to innovate new products and new approaches.Managing in an E-Business WorldOrganizations (small to large, all types, global and domestic, and in all industries) are becoming e-businesses. Today's managers must manage in an e-business world! In fact, as a student, your learning may increasingly be taking place in an electronic environment. What do we know about this e-business world?E-business (electronic business) is a comprehensive term describing the way an organization does its work by using electronic (Internet-based) linkages with its key constituencies (employees, managers, customers, suppliers, and partners) in order to efficiently and effectively achieve its goals. It's more than e-commerce, although e-business can include e-commerce. E-commerce (electronic commerce) is any form of business exchange or transaction in which the parties in-teract electronically. Firms such as Dell (computers), Varsitybooks (textbooks), and PC Flowers and Gifts (flowers and other gifts) are engaged in e-commerce because they sell products over the Internet. Given are the main forms of e-commerce transactions. Although e-commerce applications will continue to grow in volume, they are only one part of an e-business.

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Not every organization is or needs to be a total e-business. Below diagram illustrates three categories of e-business involvement.

The first type is what we're going to call an e-business enhanced organization, a traditional organization that sets up e-business capabilities, usually e-commerce, while maintaining its traditional structure. Many Fortune 500 type organizations are evolving into e-businesses using this approach. They use the Internet to enhance (not to replace) their traditional ways of doing business. For instance, Sears, a traditional bricks-and-mortar retailer with thousands of physical stores worldwide started an Internet division whose goal is to make Sears "the definitive online source for the home." Although Sears Internet division, Sears.com, represents a radical departure for an organization founded in 1886 as a catalog-sales company, it's intended to expand, not replace, the company's main source of revenue. Many other traditional organizations—for instance, Merrill Lynch, Office Depot, Starbucks, Tupperware, and Whirlpool—have become e-business enhanced organizations.Another category of e-business involvement is an e-business enabled organization. In this type of e-business, an organization uses the Internet to perform its traditional business functions better but not to sell anything. In other words, the Internet enables organizational members to do their work more efficiently and effectively. There are numerous organizations using electronic linkages to communicate with employees, customers, or suppliers and to support them with information. For instance, Levi Strauss & Co. uses its Web site to interact with customers, providing them the latest information about the company and its products, but they can't buy Levis there. It also uses an intranet, an internal organizational communication system that uses Internet technology and is accessible only by organizational employees, to communicate with its global workforce.The last category of e-business involvement is when an organization becomes a total e-business. Many organizations—such as Amazon.com, Yahoo, E*Trade, and eBay—started as total e-business organizations. Their whole existence is

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made possible by and revolves around the Internet. Other organizations, such as Charles Schwab & Company, have evolved into e-business organizations that seamlessly integrate traditional and e-business functions. When an organization becomes a total e-business, there's a complete transformation in the way it does its work. Quality ManagementA quality revolution swept through both the business and public sectors during the 1980s and 1990s. The generic term used to describe this revolution was total quality management, or TQM for short. It was inspired by a small group of quality experts, the most famous being W. Edwards Deming and Joseph M. Juran. The ideas and techniques espoused by these two men in the 1950s had few supporters in the United States but were enthusiastically embraced by Japanese organizations. As Japanese manufacturers began beating out U.S. competitors in quality comparisons, Western managers soon began taking a more serious look at TQM. Deming's and Juran's ideas became the basis for today's organizational quality management programs.TQM is a philosophy of management driven by continual improvement and responding to customer needs and expectations. 1. Intense focus on the customer. The customer includes not only outsiders

who buy the organization's products or services but also internal customers (such as shipping or accounts payable personnel) who interact with and serve others in the organization.

2. Concern for continual improvement. TQM is a commitment to never being satisfied. "Very good" is not good enough. Quality can always be improved.

3. Process-focused. TQM focuses on work processes as the quality of goods and services is continually improved.

4. Improvement in the quality of everything the organization does. TQM uses a very broad definition of quality. It relates not only to the final product but also to how the organization handles deliveries, how rapidly it responds to complaints, how politely the phones are answered, and the like.

5. Accurate measurement. TQM uses statistical techniques to measure every critical variable in the organization's operations. These are compared against standards or benchmarks to identify problems, trace them to their roots, and eliminate their causes.

6. Empowerment of employees. TQM involves the people on the line in the improvement process. Teams are widely used in TQM programs as empowerment vehicles for finding and solving problems.

The term customer in TQM has expanded beyond the original definition of the purchaser outside the organization to include anyone who interacts with the organization's product or services internally or externally. It encompasses employees and suppliers as well as the people who purchase the organization's goods or services. The objective is to create an organization committed to continuous improvement in work processes.

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TQM is a departure from earlier management theories that were based on the belief that low costs were the only road to increased productivity. Learning Organizations and Knowledge ManagementToday's managers confront an environment in which change takes place at an unprecedented rate. Constant innovations in information and computer technologies combined with the globalization of markets have created a chaotic world. As a result, many of the past management guidelines and principles—created for a world that was more stable and predictable—no longer apply. Successful organizations of the twenty-first century must be able to learn and respond quickly.These organizations will be led by managers who can effectively challenge conventional wisdom, manage the organization's knowledge base, and make needed changes. In other words, these organizations will need to be learning organizations. A learning organization is one that has developed the capacity to continuously learn, adapt, and change.Part of a manager's responsibility in fostering an environment conducive to learning is to create learning capabilities throughout the organization—from lowest level to highest level and in all areas. How can managers do this? An important step is understanding the value of knowledge as an important resource, just like cash, raw materials, or office equipment.But in an organization, just recognizing the value of accumulated knowledge or wisdom isn't enough. Managers must deliberately manage that base of knowledge. Knowledge management involves cultivating a learning culture in which organizational members systematically gather knowledge and share it with others in the organization so as to achieve better performance. For instance, accountants and consultants at Ernst & Young, one of the Big Five professional services firms, document best practices they have developed, unusual problems they have dealt with, and other work information. This "knowledge" is then shared with all employees through computer-based applications and through COIN (community of interest) teams that meet regularly throughout the company.

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