Chapter 01 – The Management Process Today
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Chapter 01
The Management Process Today
CHAPTER CONTENTS
Chapter 01 – The Management Process Today
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LO 1-1. Describe what management is, why management is important, what
managers do, and how managers use organizational resources
efficiently and effectively to achieve organizational goals.
LO 1-2. Distinguish among planning, organizing, leading and controlling
(the four principal managerial tasks), and explain how managers’
ability to handle each one affects organizational performance.
LO 1-3. Differentiate among three levels of management and understand
the tasks and responsibilities of managers at different levels in the
organizational hierarchy.
LO 1-4. Distinguish among three kinds of managerial skill, and explain why
LO 1-5. Discuss some major changes in management practices today that
have occurred as a result of globalization and the use of advanced
information technology (IT).
LO 1-6. Discuss the principal challenges managers face in today’s
increasingly competitive global environment.
LEARNING OBJECTIVES
KEY DEFINITIONS/TERMS
Chapter 01 – The Management Process Today
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department: A group of people who work together
and possess similar skills or use the same knowledge,
tools, or techniques to perform their jobs.
responsibilities.
first-line manager: A manager who is responsible
for the daily supervision of non-managerial
employees.
goods and services or developing better ways to
produce or provide them.
leading: Articulating a clear vision and energizing
line managers and is responsible for finding the best
way to use resources to achieve organizational goals.
organizational performance: A measure of how
efficiently and effectively a manager uses resources
to satisfy customers and achieve organizational goals.
outsourcing: Contracting with another company,
usually abroad, to have it perform an activity the
organization previously performed itself.
supervising their own activities and monitoring the
quality of the goods and services they provide.
strategy: A cluster of decisions about what goals to
pursue, what actions to take and how to use resources
top management team: A group composed of the
CEO, the COO, and the vice presidents of the most
important departments.
Chapter 01 – The Management Process Today
Chapter 1 examines what management is, including what mangers do, and how they use resources to
achieve organizational goals. The chapter highlights the four main functions of management (planning,
organizing, leading and controlling) as well as exploring the levels of management (first line, middle and
top) as well as the importance of three types of managerial skills (conceptual, human and technical). The
chapter concludes with a discussion of the major changes and challenges brought forth by increased
globalization and advancement in information technology and competition faced by managers today.
NOTE ABOUT INSTRUCTOR’S POWERPOINT
SLIDES
The Instructor PowerPoint Slides include most Student
PowerPoint slides, along with additional material that
can be used to expand the lecture. Images of the
Instructor PowerPoint slides can be found at the end of
this chapter on page 1-30.
BASIC POWERPOINT SLIDE 1
(INSTRUCTOR’S POWERPOINT SLIDE 1)
Chapter Title
Management Snapshot (pp. 3-4 of text)
Alcon Entertainment Hits the Mark
How does management adapt to changing technologies?
Scott Parish is the chief financial officer and chief operating officer of Alcon Entertainment, an
entertainment production company based in Los Angeles. He began in the film industry working at an
administrative job, which enabled him to learn about the craft. Over the years, he rose in management
until he became a member of Alcon’s top team. He is credited with helping Alcon develop from a
boutique film company into a large production facility that creates films, television shows, and music.
Chapter 01 – The Management Process Today
I. What Is Management?
1. Managers operate within an organization, a
collection of people who work together and
coordinate their actions to achieve a wide variety of
goals or desired future outcomes.
2. Management is the planning, organizing, leading
and controlling of human and other resources to
achieve organizational goals effectively and
efficiency
A. Achieving High Performance: A Manager’s Goal
1. Organizational performance is a measure of how
effectively and efficiently a manger uses resources to
satisfy customers and reach organizational goals.
a. Efficiency measures how well or how
productively resources are used to achieve a goal.
the goals an organization is pursuing and the
degree to which the organization is achieving
those goals.
B. Why Study Management?
1. Managers understand the complexity of modern
work, respond to environmental contingencies, and
make decisions that are ethical and effective.
2. Studying management helps a person avoid the
mistakes made by managers in the past.
3. Students of management have the potential to
compete successfully for interesting and well-paying
jobs.
B. Organizing
1. Organizing is structuring working relationships in
a way that allows organizational members to work
together to achieve organizational goals.
LO 1–1: Describe what
management is, why
management is important,
what managers do, and how
managers utilize
organizational resources
efficiently and efficiently and
effectively to achieve
organizational goals.
POWERPOINT SLIDES 1-4 TO
1-10
LO 1–2: Distinguish among
planning, organizing, leading
principal managerial tasks),
affects organizational
2. Organizational structure is the formal system of
task and reporting relationships that coordinates and
motivates organizational members so they work
together to achieve organizational goals.
C. Leading
1. Leading is articulating a clear vision and
energizing and enabling organizational members so
they understand the part they play in achieving
organizational goals.
2. Leadership involves managers using their power,
personality, influence, persuasion, and
communication skills to coordinate people and
groups so their activities and efforts are in harmony.
1. Controlling is evaluating how well an
organization is achieving its goals and taking action
to maintain or improve performance.
2. The desired outcome of the control function of
management is the ability to measure performance
and regulate organizational efficiency and
effectiveness.
A department is a group of people who work together
and possess similar skills or use the same knowledge,
tools, or techniques to perform their jobs.
A. Levels of management
1. First-line managers: Responsible for daily
supervision of non-managerial employees; also called
supervisors.
2. Middle managers: Supervise the first-line
managers and are responsible for finding the best
way to organize human and other resources to
achieve organizational goals.
TEXT REFERENCE
Manager as a Person: Dennis
Corsi Helps Airports Take Off
An estimated 87,000 flights
operate daily in U.S. skies. A
large amount of work is required
to plan, develop, and operate
airport systems that can handle
this number of flights. Dennis
Corsi is president of Armstrong
Consultants, a Colorado-based
in this field.
Armstrong Consultants helps
airports plan, engineer, and
construct facilities that meet the
needs of their customers.
Various planes have different
landing, takeoff, and taxiing
requirements. For example,
Armstrong offers the right mix
of facilities to meet these needs.
Corsi also helps clients
coordinate with local, state, and
federal agencies to comply with
complex regulations. He works
hard to stay ahead of the
technology curve, refining his
expertise to provide valued
insight to clients.
The process of airport planning
and engineering is challenging.
Airports must obtain funding
and environmental clearances.
Chapter 01 – The Management Process Today
a. The CEO, or Chief Executive Officer, is a
company’s most senior manager, the highest in
the organizational hierarchy
b. The COO, or the Chief Operating Officer, is a
top manager who is being groomed to take over
as CEO when the CEO leaves the company.
c. The top management team is a group
composed of the CEO, the COO, and the vice
presidents most responsible for achieving
organizational goals.
B. Managerial skills
1. Education and experience help managers acquire
the three types of skills required to be a successful
manager.
a. Conceptual skills are demonstrated in the
ability to analyze and diagnose a situation and to
distinguish between cause and effect. Top
managers require outstanding conceptual skills
because their primary responsibilities are
individuals and groups as well as the ability to
communicate, coordinate and motivate people
into a cohesive team.
organization.
2. Core competency is a specific set of departmental
other organizations.
be able to understand the
complexities of each of these
functional areas and coordinate
their activities for multiple
clients at once. (pp.8-9)
LO 1–3: Differentiate among
three levels of management
and understand the tasks and
responsibilities of managers
at different levels in the
organizational hierarchy.
POWERPOINT SLIDES 1-20 TO
1-28
LO 1–4: Distinguish among
three kinds of managerial
4. Effective managers need all three types of skills
(conceptual, human, and technical) to help their
organization perform more efficiently and
effectively.
IV. Recent Changes in Management Practices
A. Restructuring and Outsourcing
Due to increased global competition and advances in
information technology (IT) the tasks and responsibilities
of managers have changed through restructuring and
outsourcing to reduce the number of employees on the
payroll and make more productive use of the remaining
workforce.
1. Restructuring is the simplifying, shrinking, or
downsizing an organization’s operation to lower
operating costs.
product teams, shrinking departments, and
reducing levels of the hierarchy.
perform a particular work task.
2. Outsourcing involves contracting with another
company usually in a low-cost country abroad, to
have it perform a work activity the organization
a. Outsourcing increases efficiency through
lowering operating costs.
LO 1–5: Discuss some major
changes in management
practices today that have
occurred as a result of
globalization and the use of
advanced information
technology (IT).
POWERPOINT SLIDES 1-31 TO
1-34
TEXT REFERENCE
Brings Manufacturing Jobs
Back Home
decided to reverse this trend and
began a policy of insourcing. The
story of this about-face
illustrates a recent trend in U.S.
manufacturing: bringing jobs
GE once had a huge
manufacturing center called
Appliance Park that employed
23,000 workers and produced
2. Lower-level employee empowerment and
movement towards self-managed teams is a strategy to
increase efficiency and effectiveness. A self-managed
team is a group of employees who assume collective
responsibility for organizing, controlling and
supervising their own work activities
3. Increased IT efficiency has fostered employee
empowerment because it expands an employee’s job
knowledge and increases the scope of an employee’s
job responsibilities.
V. Challenges for Management in a Global
Environment
Global organizations are organizations that operate and
compete in more than one country. In order to remain
competitive in a global environment managers must face
five major challenges:
a. building a competitive advantage
b. maintaining ethical standards
c. managing a diverse work force
d. utilizing new information systems and
technologies
1. A competitive advantage is the ability of one
organization to outperform other organizations
because it produces desired goods or services more
efficiently and effectively than its competitors.
2. The four building blocks of competitive advantage
are superior efficiency, quality, innovation, and
responsiveness to customers.
and raw materials) they use to produce goods and
services.
b. Increased pressure by global organizations has
countries, such as China, made
labor less competitive compared
with U.S. wage rates. Third,
many states have enacted
regulations that are more
“business friendly,” further
reducing costs. Finally, the U.S.
workforce has continued to
increase its productivity.
In GE’s case, the reason to
bring jobs to American soil
concerns innovation. Smarter
versions of appliances are in
greater demand, and it no longer
makes financial sense to set up
operations overseas when
products have shorter life
cycles.
GE and many other companies
are finding that keeping
everything in house under one
roof, rather than in different
locations far away from each
other, ensures the highest-
quality product and the
principal challenges
managers face in today’s
increasingly competitive
global environment
POWERPOINT SLIDES 1-35 TO
1-40
TEXT REFERENCE
ETHICS IN ACTION: Apple
Demands Quality from Its
Chapter 01 – The Management Process Today
c. Companies can win or lose the competitive
race depending on their speed and flexibility.
i. Speed is how quickly an organization can
bring a new product to market.
ii. Flexibility is how easily an organization
can change or alter the way an activity is
performed in response to competition
d. Innovation is the process of creating new or
improved goods and services that customers want
or developing better ways to produce or provide
3. Turnaround Management is the creation of a
new vision for a struggling company using a new
significantly from Western
expectations, including the use
of child labor, work weeks
exceeding 60 hours, and work
environments that are physically
and psychologically crippling.
Apple came under fire for not
carefully monitoring work
conditions at supplier factories
in other parts of the world.
Many complaints about sex
discrimination, long work
hours, and the mining of
the company publishes an
annual Report of Supplier
Responsibility that is available
to the public. This report lists
Chapter 01 – The Management Process Today
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C. Managing a Diverse Workforce
1. The challenge for managers is to recognize the
ethical need and legal requirement to treat human
resources in a fair and equitable manner.
2. Today the age, gender, race, ethnicity, religion,
sexual preference, and socioeconomic composition of
the workforce presents new challenges for managers.
3. To create a highly trained and motivate workforce,
and to avoid lawsuits, human resource management
(HRM) procedures and practices that are legal and
fair must be put into place.
4. Managers who value their diverse employees
succeed best in promoting performance over the long
run
5. Diverse human resources can be used as a
competitive advantage
D. Utilizing IT and E-Commerce
1. An important challenge for managers is to
continually utilize efficient and effective new IT that
can link and enable managers and employees to
better perform their jobs—whatever their level in the
organization.
2. New information technology (IT) has enabled
individual employees and self-managed teams by
providing them with more information and allowing
for virtual interactions.
3. IT superiority is a potential competitive advantage.
Chapter 01 – The Management Process Today
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Lecture Enhancer 1.1
WHY COMPANIES FAIL
CEOs often attempt to explain poor corporate performance with external environmental factors outside of
their control, such as a bad economy, market turbulence, or competitive subterfuge. A close study of
corporate failure, however, suggests that most companies flounder because of managerial error, according
1. Softened by Success: A number of studies show that people are less likely to make optimal
2. See No Evil: Author Jim Collins says that a litmus test of greatness within a company is its
willingness to confront brutal facts head-on instead of trying to explain them away. Andy Grove
3. Fearing the Boss More Than the Competition: Sometimes CEOs don’t get the information they
need because their subordinates are afraid to tell them the truth. Although it may not be CEOs
4. Listening to Wall Street more than to employees: During the late 1990’s, Lucent’s CEO was
delivering the top-line growth that Wall Street wanted, and in return, Wall Street lavished the
5. Strategy Du Jour: When companies run into trouble, the desire for a quick fix can become
overwhelming. The frequent result is illustrated by a description of A&P by author Jim Collins.
LECTURE ENHANCERS
Chapter 01 – The Management Process Today
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Lecture Enhancer 1.2
WHY GOOD EMPLOYEES CAN BE BAD MANAGERS
You have a good employee, a hard worker, technically proficient. You promote him and it turns out
to be a bad decision. You have promoted your best technical employee, and in the process, lose a good
employee and gain a poor manager. How does this happen?
Good technical employees can make good managers, of course, but many do not. Good technical
Notes for Topics for Discussion and Action
DISCUSSION
1. Describe the difference between efficiency and effectiveness and identify real organizations you think
are, or are not, efficient and/or effective.
2. In what ways can managers at each of the three levels of management contribute to organizational
efficiency and effectiveness?
MANAGEMENT IN ACTION
Chapter 01 – The Management Process Today
the necessary skills and have access to the most efficient technology and machinery. Top managers can
contribute to organizational efficiency by ensuring that departments throughout the company are
3. Identify an organization that you believe is high performing and one you believe is low performing.
Give five reasons why you think the performance levels of the two organizations differ so much.
(1) The high performing organization has managers who interact with and motivate employees, while the
(2) The high performing organization has managers who set difficult but achievable goals for their
(3) In a high performing organization, bonuses or rewards are directly tied to the company’s performance.
(4) High performing organization managers are able to delegate authority, and hold employees
(5) Managers who solicit feedback from employees on how to manage the organization efficiently and
(6) Managers in high performing organizations tend to take a “hands–on” approach to management, for
(7) High performing organizations have managers who are able to choose appropriate goals to pursue,
1-15
(8) Managers in high performing organizations know how to organize, or how to establish relationships
(9) Leading involves determining direction, articulating a clear vision for employees to follow, and
(10) High performing organizations have managers who are proficient at controlling, or evaluating how
4. What are the building blocks of competitive advantage? Why is obtaining a competitive advantage an
important to managers?
5. In what ways do you think managers’ jobs have changed the most over the last 10 years? Why have
these changes occurred?