EXAM 2 OUTLINE OF SHIT I NEED TO KNOW

Chapter 6
What is Management?

Management process of coordinating people and other resources to achieve the goals of an
organization
o

Resources - Material, human, financial, informational Organizational goals

Planning

Planning establishing organizational goals and deciding how to accomplish them

o

First management function

Mission a statement of the basic purpose that makes an organization different from others

Strategic Planning Process the establishment of an organizations major goals and objectives
and the allocation of resources to achieve them

Goal an end result that an organization is expected to achieve over a one to ten-year period

Objective a specific statement detailing what an organization intends to accomplish over a

shorter period of time

Planning

Organizing

Leading
and
Motivating

Controlling

SWOT Analysis - the identification and evaluation of a firms strengths, weaknesses,

opportunities, and threats

Strengths & Weaknesses are INTERNAL

Opportunities and Threats are EXTERNAL

Core Competencies approaches and processes that a company performs well that may give it
an advantage over its competitors

Plan an outline of the actions by which an organization intends to accomplish its goals and
objectives

Strategic Plan an organizations broadest plan, developed as a guide for major policy setting
and decision making
o

Set by the board of directors and top management for long-term goals

Tactical Plan a smaller scale plan developed to implement a strategy

Optional Plan a type of plan designed to implement tactical plans

Contingency Plan a plan that outlines alternative course of action that may be taken if an
organizations other plans are disrupted or become ineffective

Organizing the Enterprise

Organizing the grouping of resources and activities to accomplish some end result in an
efficient and effective manner

Leading and Motivating

Leading the process of influencing people to work toward a common goal

Motivating the process of providing reasons for people to work in the best interests of an
organization

Directing the combined processes of leading and motivating

Controlling Ongoing Activities

Controlling the process of evaluating and regulating ongoing activities to ensure that goals are
achieved

1. Setting
Standards

3. Taking
Corrective
Action

2. Measuring
Actual
Performance

Kinds of Managers
Levels of Management

Top Manager an upper-level executive who guides and controls the overall fortunes of an
organization

Middle Manager a manager who implements the strategy and major policies developed by top
management

First-Line Manager a manager who coordinates and supervises the activities of operating
employees

Areas of Management Specialization

Financial Manager a manager who is primarily responsible for an organizations financial

resources

Operations Manager a manager who manages the systems that convert resources into goods
and services

Marketing Manager a manager who is responsible for facilitating the exchange of products
between an organization and its customers or clients

Human Resources Manager a person charged with managing an organizations human

resources programs

Administrative Manager (general manager) a manager who is not associated with any specific
functional area but who provides overall administrative guidance and leadership

Key Skills of Successful Managers

Conceptual Skills the ability to think in abstract terms

Analytic Skills the ability to identify problems correctly, generate reasonable alternatives, and
select the best alternatives to solve problems

Interpersonal Skills the ability to deal effectively with other people

Technical Skills Specific skills needed to accomplish a specialized activity

Communication Skills the ability to speak, listen, and write effectively

Leadership

Leadership the ability to influence others

Autocratic Leadership task-oriented leadership style in which workers are told what to do and
how to accomplish it without having a say in the decision making process

Participative Leadership leadership style in which all members of a team are involved in
identifying essential goals and developing strategies to reach those goals

Entrepreneurial Leadership personality-based leadership style in which the manager seeks to

inspire workers with a vision of what can be accomplished to benefit all stakeholders

Managerial Decision Making

Decision Making the act of choosing one alternative from a set of alternatives

1. Identify the Problem or Opportunity

2. Generating Alternatives
3. Selecting an Alternative
4. Implementing and evaluating the solution

Problem the discrepancy between an actual condition and a desired condition

Managing Total Quality

Total Quality Management (TQM) the coordination of efforts directed at improving:

customer satisfaction

increasing employee participation

strengthening supplier partnerships

facilitating an organizational atmosphere of continuous quality improvement

Benchmarking a process used to evaluate the products, processes, or management practices

of another organization that is superior in some way in order to improve quality

Chapter 7
What is an Organization?

Organization a group of two or more people working together to achieve a common set of
goals

Organization Chart a diagram that represents the positions and relationships within an
organization

Chain of Command the line of authority that extends from the highest to the lowest levels of an
organization

Job Design

Job Specialization the separation of all organizational activities into distinct tasks and the
assignment of different tasks to different people

Job Rotation the systematic shifting of employees from one job to another

Departmentalization the process of grouping jobs into manageable units

Departmentalization by function grouping jobs that relate to the same organizational activity

Departmentalization by product grouping activities related to a particular product or service

Departmentalization by location grouping activities according to the defined geographic area

in which they are performed

Departmentalization by customer grouping activities according to the needs of various

customer populations

Delegation, Decentralization, and Centralization

Delegation assigning part of a managers work and power to other workers

1. Assign responsibility
2. Grant authority
3. Create accountability

Responsibility the duty to do a job or perform a task

Authority the power, within an organization, to accomplish an assigned job or task

Accountability the obligation of a worker to accomplish an assigned job or task

Decentralized Organization an organization in which management consciously attempts to

spread authority widely in the lower levels of the organization

Centralized Organization an organization that systematically works to concentrate authority at

the upper levels of the organization

The Span of Management

Span of Management (span of control) the number of workers who report directly to one
manager

Wide and Narrow Spans of Management

o

Wide when a manager has a larger number of subordinates

High level of competence in managers and workers

Standard operating procedures

Few new problems

Narrow when the manager has only a few subordinates

Physical dispersion of subordinates

Manager has additional tasks

High level of interaction required between manager and workers

High frequency of new problems

Organizational Height the number of layers, or levels, of management in a firm

o

If span is wide, fewer levels are needed and it is said to be flat

If span is narrow, more levels are needed and it is said to be tall

Forms of Organizational Structure

Line Structure an organizational structure in which the chain of command goes directly from
person to person throughout the organization

Line Manager a position in which a person makes decisions and gives orders to subordinates
to achieve the organizations goals

Line-and-Staff Structure an organizational structure that utilizes the chain of command from a
line structure in combination with the assistance of staff managers

Staff Managers a position created to provide support, advice, and expertise within an
organization
o

Line authority line managers can make decisions and issue directives relating to the
organizations goals

Advisory Authority the expectation that line managers will consult the appropriate
staff manager when making decisions

Functional Authority the authority of staff managers to make decisions and issue
directives about their areas of expertise

Matrix Structure an organizational structure that combines vertical and horizontal lines of
authority, usually by superimposing product departmentalization on a functionally
departmentalized organization

Cross-Functional Team a team of individuals with varying specialties, expertise, and skills that
are brought together to achieve a common task

Network Structure (Virtual Organization) an organizational structure in which administration is

the primary function, and most other functions are contracted out to other firms

Corporate Culture

Corporate Culture the inner rites, rituals, heroes, and values of a firm

Networked Culture

Communal Culture

Fragmented Culture

Mercenary Culture

Committees and Task Forces

Ad Hoc Committee a committee created for a specific short-term purpose

Standing Committee a relatively permanent committee charged with performing some

recurring task

The Informal Organization and the Grapevine

Informational Organization the pattern of behavior and interaction that stems from personal
rather than official relationships

Informal Group a group created by the members themselves to accomplish goals that may or
may not be relevant to an organization

Grapevine the informal communications network within an organization

Chapter 8
What is Production?

Operations Management all the activities required to produce goods and services

Reshoring a situation in which U.S. manufacturers bring manufacturing jobs back to the United
States

Mass Production a manufacturing process that lowers the cost required to produce a large
number of identical or similar products over a long period of time

Analytical Process a process in operations management in which raw materials are broken
into different component parts

Synthetic Process a process in operations management in which raw materials or

components are combined to create a finished product

The Conversion Process

Utility the ability of a good or service to satisfy a human need

Form Utility utility created by people converting raw materials, finances, and information into
finished products

Manufacturing Using a Conversion Process

o

Focus resource or resources that make up the major or most important input

Magnitude of Change the degree to which the resources are physically changed

Number of Production Processes some companies use a number of conversion

processes

The Increasing Importance of Services

Service Economy an economy in which more effort is devoted to the production of services
than to the production of goods

Where Do New Products and Services Come From?

Research and Development (R&D) a set of activities intended to identify new ideas that have
the potential to result in new goods and services
o

Basic Research aimed at uncovering new knowledge

Applied Research - activities geared toward discovering new knowledge with come
potential use

Development and Research involves research activities undertaken specifically to put

new or existing knowledge to use in producing goods and services

Product Research and Refinement

o

Product Refinement make existing products better

Product Extension additional features that extend the products capabilities

How Do Managers Plan Production?

Design Planning the development of a plan for converting an idea into an actual product or
service

Product Line a group of similar products that differ only in relatively minor characteristics

Product Design the process of creating a set of specifications from which a product can be
produced

Capacity - that amount of products or services that an organization can produce in a given time

Labor-Intensive Technology a process in which people must do most of the work

o

Low initial cost, high operating costs

Capital-Intensive Technology a process in which machines and equipment do most of the

work
o

High initial cost, low operating costs

Plant Layout the arrangement of machinery, equipment, and personnel within a production
facility

Process Layout used when different operations are required for creating small batches of
different products or working on different parts of a product

Product Layout (Assembly Line) used when all products undergo the same operations in the
same sequence

Fixed-Position Layout when a very large product is produced

Operational Planning
Step 1: Selecting a Planning Horizon

Planning Horizon the period during which an operational plan will be in effect

Step 2: Estimating Market Demand

Market Demand quantity that customers will purchase at the going price

Step 3: Comparing Market Demand with Capacity

Step 4: Adjusting Products or Services to Meet Demand

Operations Control

Purchasing all the activities involved in obtaining required materials, supplies, components,
and parts from other firms

Price

Quality

Reliability

Credit Terms

Shipping Costs

Inventory Control the process of managing inventories in such a way as to minimize inventory
costs, including both holding costs and potential stock-out costs

Work-in-process

Finished-goods

Holding Costs, storage costs, and stock-out costs

Materials Requirements Planning (MRP) a computerized system that integrates production

planning and inventory control

Just-in-time Inventory System a system designed to ensure that materials or supplies arrive
at a facility just when they are needed so that storage and holding costs are minimized

Scheduling the process of ensuring that materials and other resources are at the right place at
the right time