CHAPTER 1: MANAGEMENT

FUNDAMENTALS

Business Leadership: Management Fundamentals

John R. Schermerhorn, Jr., Barry Wright, and Lorie Guest

John Wiley & Sons Canada, Ltd.

PLANNING
AHEAD
CHAPTER 1
LEARNING
GOALS

o Understand the current workplace

environment in Canada
o Identify the characteristics of an
organization
o Understand who managers are
and what they do
o Describe the management
process and how managerial skills
and competencies are learned

OVERVIEW OF THE NEW WORKPLACE

The dynamics of ever-present change extend into

the workplace and raise a host of new career

challenges.
Smart people commit their energies and intellect to
continuous learning and personal development.
Companies with a future are committed to people.
Companies with a future offer inspirational
leadership and rewards, respect people, and provide
supportive work environments.
High performing companies gain extraordinary
results from people.

WORKING TODAY

Talent
Diversity
Globalization
Technology
Ethics
Careers

TALENT
People and their talents are the ultimate

foundations of organizational performance.

Intellectual capital is the collective
brainpower or shared knowledge of a
workforce that can be used to create value.
A knowledgeable workers mind is a critical
asset to employers and adds to the
intellectual capital of an organization.

DIVERSITY
Workforce diversity reflects differences with
respect to gender, age, race, ethnicity, religion,
sexual orientation, and able-bodiedness.
A diverse and multicultural workforce both
challenges and offers opportunities to employers.
Many call diversity a business imperative and
view it as an asset.

DIVERSITY

(CONTD)

How diversity bias can occur in the workplace:

Prejudice: the display of negative, irrational

attitudes toward members of a diverse
population.
Discrimination: actively denies minority
members the full benefits of organizational
membership.
Glass ceiling effect: an invisible barrier limiting
career advancement of women and minorities.

VIDEO: A SCIENCE GLASS CEILING

- GLOBE & MAIL

A Science Glass Ceiling

(external link)

GLOBALIZATION
National boundaries of world business have

largely disappeared.
Globalization is the worldwide interdependence
of resource flows, product markets, and business
competition that characterize the new economy.

John Wiley & Sons Canada Ltd.

TECHNOLOGY
Continuing transformation of the modern
workplace through:
- The Internet
- World Wide Web
- Computer networking
- Information technology
- Telecommuting/virtual teaming/mobile offices
Increasing demand for knowledge workers with
the skills to fully use technology.

VIDEO: SOCIAL MEDIA REVOLUTION

Social Media Revolution by Erik Qualman

(external link)

ETHICS
Ethics

- Code of moral principles that set standards of

conduct of what is good and right
Ethical expectations for modern businesses:
- Integrity and ethical leadership at all levels
- Sustainable development
- Natural environment protection
- Consumer protection
- Human rights

CAREERS
Core workers, contract workers, and part-time
workers
People must be prepared to be any one of these
types of workers
People must make sure that their skills are
portable and of current value in employment
markets

EARLY CAREER SURVIVAL SKILLS

Critical skills for success in the new workplace
Mastery
Networking
Entrepreneurship
Love of technology
Marketing
Passion for renewal

WHAT IS AN ORGANIZATION?
A collection of people working together to
achieve a common purpose
Organizations provide useful goods and/or
services that return value to society and satisfy
customer needs

ORGANIZATIONS

(CONTD)

Organizations are open systems

Composed of interrelated parts that function

together to achieve a common purpose
Interact with their environments
Transform resource inputs into product outputs
(goods and services)
Environmental feedback tells organization how
well it is meeting the needs of customers and
society

FIGURE 1.3 ORGANIZATIONS AS

OPEN SYSTEMS

ORGANIZATIONS

(CONTD)

Organizational performance

Value creation is a very important notion for

organizations
Value is created when an organizations
operations adds value to the original cost of
resource inputs
When value creation occurs:
Businesses earn a profit
Nonprofit organizations add wealth to society

John Wiley & Sons Canada Ltd.

ORGANIZATIONAL PERFORMANCE
Productivity
- An overall measure of the quantity and quality
of outputs relative to the cost of inputs
Performance effectiveness
- An output measure of task or goal
accomplishment
Performance efficiency
- An input measure of the resource costs
associated with goal accomplishment

FIGURE 1.4 PRODUCTIVITY AND THE

DIMENSIONS OF ORGANIZATIONAL
PERFORMANCE

CHANGING NATURE OF
ORGANIZATIONS
Workplace changes that provide a context for

studying management:
Renewed belief in employees
Disappearance of command-and-control
Emphasis on teamwork
Prominence of technology
Embrace of networking
New workforce expectations
Concern for work-life balance
Focus on speed

MANAGERS IN THE NEW

WORKPLACE
Importance of human resources and managers
People are not costs to be controlled.
High performing organizations treat people as

valuable strategic assets.

Managers must ensure that people are treated

as strategic assets.

MANAGERS
Directly support and help activate the work efforts

and performance accomplishments of others

The people who managers help are the ones whose

tasks represent the real work of the organization

LEVELS OF MANAGEMENT
Top managers: responsible for the performance
of an organization as a whole or for one of its
larger parts
Middle managers: in charge of relatively large
departments or divisions
Team leaders or supervisors: in charge of a
small work group of non-managerial workers

FIGURE 1.5 MANAGEMENT LEVELS IN A

TYPICAL BUSINESS AND NON-PROFIT
ORGANIZATIONS

RESPONSIBILITIES OF TEAM
LEADERS
Plan meetings and work schedules
Clarify goals and tasks, and gather ideas for

improvement
Appraise performance and counsel team
members
Recommend pay raises and new assignments
Recruit, train, and develop team members
Plan meetings and work schedules
Clarify goals and tasks, and gather ideas for
improvement
Appraise performance and counsel team
members
Recommend pay raises and new assignments

TYPES OF MANAGERS
Line managers: are responsible for work
activities that directly affect organizations
outputs
Staff managers: use technical expertise to
advise and support the efforts of line workers
Functional managers: are responsible for a
single area of activity
General managers: are responsible for more
complex units that include many functional areas
Administrators: work in public and nonprofit
organizations

ORGANIZATIONAL EFFECTIVENESS
In order to attain sustainable high performance,

organizations use resources effectively to

accomplish missions and objectives.
- The Systems Resource Approach focuses

on resource acquisition
- The Internal Process Approach focuses on

operations efficiency
- The Goal Approach focuses on accomplishing

key objectives
- Strategic Constituencies focus on

stakeholder impact

MANAGERIAL PERFORMANCE
Accountability is the requirement of one person
to answer to a higher authority for relevant
performance results.
Effective managers fulfill performance
accountability by helping others to achieve high
performance outcomes and experience
satisfaction in their work.

MANAGERIAL PERFORMANCE

(CONTD)

Quality of work life (QWL)

An indicator of the overall quality of human

experiences in the workplace

QWL indicators:
Fair pay
Safe working conditions
Opportunities to learn and use new skills
Room to grow and progress in a career
Protection of individual rights
Pride in work itself and in the organization

HIGH PERFORMING MANAGERS

Are well informed of their teams needs
Work alongside those they supervise
Provide advice and develop support for their

team
Help others perform to the best of their abilities

THE ORGANIZATION AS AN UPSIDEDOWN PYRAMID

Reflects the changing nature of work today
A managers job is to support workers efforts
Whole organization is devoted to serving the
customer

FIGURE 1.6 THE ORGANIZATION AS

AN UPSIDE-DOWN PYRAMID

MANAGEMENT PROCESS
Managers achieve high performance for their

organizations by best utilizing its human and

material resources.
Management is the process of planning, organizing,

leading, and controlling the use of resources to

accomplish performance goals.
All managers are responsible for the four functions.
The functions are carried on continually.

FIGURE 1.7 THE FOUR FUNCTIONS

OF MANAGEMENT

FUNCTIONS OF MANAGEMENT
Planning:
- The process of setting objectives and
determining what actions should be taken to
accomplish them
Organizing:
- The process of assigning tasks, allocating
resources, and arranging the coordinated
activities of individuals and groups to
implement plans

FUNCTIONS OF MANAGEMENT
(CONTD)

Leading:
- The process of arousing peoples enthusiasm
to work hard and direct their efforts to fulfill
plans and accomplish objectives
Controlling:
- The process of measuring work performance,
comparing results to objectives, and taking
corrective action as needed

MANAGERIAL ROLES AND

ACTIVITIES
Informational roles:
- Involves giving, receiving, and analyzing
information
Interpersonal roles:
- Involves interactions with persons inside and
outside the work unit
Decisional roles:
- Involves using information to make decisions,
solve problems, or address opportunities

FIGURE 1.8 MINTZBERGS 10

MANAGERIAL ROLES

CHARACTERISTICS OF MANAGERIAL
WORK

Managers work
Managers work
Managers work
Managers work
media
Managers work
relationships

long hours
at an intense pace
at fragmented and varied tasks
with many communications
largely through interpersonal

MANAGERIAL AGENDAS AND

NETWORKS
Agenda setting
- Development of action priorities for ones job
- Include goals and plans that span long and short
time frames
Networking
- Process of building and maintaining positive
relationships with people whose help may be
needed to implement ones work agendas
Social Capital
- Capacity to attract support and help from others in
order to get things done

ESSENTIAL MANAGERIAL SKILLS

Learning

- The change in a behaviour that results from

experience
Lifelong learning
The process of continuously learning from daily
experiences and opportunities
Career success depends on real commitment
to learning
Not just formal classroom learning

ESSENTIAL MANAGERIAL SKILLS

(CONTD)

Skill: the ability to translate knowledge into

action that results in desired performance
Technical skill: the ability to apply a special
proficiency or expertise to perform particular
tasks
Human or interpersonal skill: the ability to
work well in cooperation with others
- Emotional intelligence is the ability to manage
ourselves and relationships effectively
Conceptual skill: the ability to think critically
and analytically to solve complex problems

FIGURE 1.9 KATZS ESSENTIAL

MANAGERIAL SKILLS

MANAGERIAL COMPETENCY
A skill-based capability that contributes to high
performance in a management job

COMPETENCIES FOR MANAGERIAL

SUCCESS
Communication
Teamwork
Self-management
Leadership
Critical thinking
Professionalism

John Wiley & Sons Canada Ltd.

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