ICk MANLLD2A ULS1ICNS

1
How does tbe externaI envIronment InIIuence busIness perIormance oI your own
organIzatIon? Use exampIes>
Tbe ExternaI EnvIronment
All ouisidc faciors iIai may affcci an organizaiion malc u iIc cicrnal cnvironmcni. TIc
cicrnal cnvironmcni is dividcd inio iwo aris.
O DIrectIy InteractIve: TIis cnvironmcni Ias an immcdiaic and firsiIand imaci uon
iIc organizaiion. A ncw comciiior cnicring iIc marlci is an camlc.
O IndIrectIy InteractIve: TIis cnvironmcni Ias a sccondary and morc disiani cffcci uon
iIc organizaiion. Ncw lcgislaiion ialing cffcci may Iavc a grcai imaci. For camlc,
comlying wiiI iIc Amcricans wiiI Disaliliiics Aci rcquircs cmloycrs io udaic iIcir
faciliiics io accommodaic iIosc wiiI disaliliiics.
DIrectIy InteractIve Iorces
D1reo11g 1n1eroo11vc forccs includc owncrs, cusiomcrs, sulicrs, comciiiors, cmloyccs, and cmloycc
unions. Management bas a responsIbIIIty to eacb oI tbese groups. Hcrc arc somc exampIes:
O Owners ccci managcrs io waicI ovcr iIcir inicrcsis and rovidc a rciurn on invcsimcnis.
O Customers dcmand saiisfaciion wiiI iIc roducis and scrviccs iIcy urcIasc and usc.
O SuppIIers rcquirc aiicniivc communicaiion, aymcni, and a sirong worling rclaiionsIi io
rovidc nccdcd rcsourccs.
O CompetItors rcscni cIallcngcs as iIcy vic for cusiomcrs in a marlcilacc wiiI similar roducis
or scrviccs.
O EmpIoyees and empIoyee unIons rovidc loiI iIc colc io do iIc jols and iIc rcrcscniaiion
of worl forcc conccrns io managcmcni.
IndIrectIy InteractIve Iorces
TIc sccond iyc of cicrnal cnvironmcni is iIc ndcct ntcuctuc forccs. TIcsc forccs includc
socioculiural, oliiical and lcgal, iccInological, cconomic, and glolal influcnccs. Indirccily inicraciivc
forccs may imaci onc organizaiion morc iIan anoiIcr simly lccausc of iIc naiurc of a ariicular
lusincss. For camlc, a comany iIai rclics Icavily on iccInology will lc morc affccicd ly sofiwarc
udaics iIan a comany iIai uscs jusi onc comuicr. AliIougI somcwIai rcmovcd, indircci forccs arc
siill imoriani io iIc inicraciivc naiurc of an organizaiion.
TIc sococutuu dimcnsion is csccially imoriani lccausc ii dcicrmincs iIc goods, scrviccs, and
siandards iIai sociciy valucs. TIc socioculiural forcc includcs iIc dcmograIics and valucs of a
ariicular cusiomcr lasc.

O DemograpbIcs arc mcasurcs of iIc various cIaracicrisiics of iIc colc and social grous wIo
malc u a sociciy. Agc, gcndcr, and incomc arc camlcs of commonly uscd dcmograIic
cIaracicrisiics.
O VaIues rcfcr io ccriain lclicfs iIai colc Iavc aloui diffcrcni forms of lcIavior or roducis.
CIangcs in Iow a sociciy valucs an iicm or a lcIavior can grcaily affcci a lusincss. (TIinl of all
iIc fads iIai Iavc comc and gonc!}
TIc 541111oo1 ond 1ego1 d1mens14ns of iIc cicrnal cnvironmcni includc rcgulaiory aramcicrs wiiIin
wIicI an organizaiion musi ocraic. Poliiical ariics crcaic or influcncc laws, and lusincss owncrs musi
alidc ly iIcsc laws. Ta olicics, iradc rcgulaiions, and minimum wagc lcgislaiion arc jusi a fcw
camlcs of oliiical and lcgal issucs iIai may affcci iIc way an organizaiion ocraics.
TIc 1eon414g1oo1 d1mens14n oI iIc cicrnal cnvironmcni imacis iIc scicniific roccsscs uscd in
cIanging inuis (rcsourccs, lalor, moncy} io ouiuis (goods and scrviccs}. TIc succcss of many
organizaiions dccnds on Iow wcll iIcy idcniify and rcsond io cicrnal iccInological cIangcs.
For camlc, onc of iIc mosi significani iccInological dimcnsions of iIc lasi scvcral dccadcs Ias lccn iIc
incrcasing availaliliiy and affordaliliiy of managcmcni informaiion sysicms (also lnown as MIS}.
TIrougI iIcsc sysicms, managcrs Iavc acccss io informaiion iIai can imrovc iIc way iIcy ocraic and
managc iIcir lusincsscs.
QuestIon 3
Wbat are tbe beneIIts oI smaII busIness operatIons to Iarge corporatIons?
A small lusincss (also callcd a mom-and-o}
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is a lusincss iIai is rivaicly owncd and ocraicd, wiiI a
small numlcr of cmloyccs and rclaiivcly low volumc of salcs. Small lusincsscs arc normally rivaicly
owncd cororaiions, arincrsIis, or solc roriciorsIis. TIc lcgal dcfiniiion of "small" varics ly couniry
and ly indusiry, ranging from fcwcr iIan 15 cmloyccs..
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Small lusincsscs can also lc classificd
according io oiIcr mciIods sucI as saIes, assets, or net proIIts.
Small lusincsscs arc common in many counirics, dccnding on iIc cconomic sysicm in ocraiion.
Tyical camlcs includc. convcnicncc siorcs, oiIcr small sIos (sucI as a lalcry or dclicaicsscn},
Iairdrcsscrs, iradcsmcn, lawycrs, accounianis, rcsiauranis, gucsi Iouscs, IoiograIcrs, small-scalc
manufaciuring, and onlinc lusincss, sucI as wcl dcsign and rogramming, cic
Advantages oI smaII busIness
A small lusincss can lc siaricd ai a vcry low cosi and on a ari-iimc lasis. Small lusincss is also wcll
suiicd io inicrnci marlciing lccausc ii can casily scrvc sccializcd nicIcs, somciIing iIai would Iavc
lccn morc difficuli rior io iIc inicrnci rcvoluiion wIicI lcgan in iIc laic 1990s. Adaiing io cIangc is
crucial in lusincss and ariicularly small lusincss; noi lcing iicd io any lurcaucraiic incriia, ii is
iyically casicr io rcsond io iIc marlcilacc quiclly. Small lusincss roriciors icnd io lc iniimaic wiiI
iIcir cusiomcrs and clicnis wIicI rcsulis in grcaicr accounialiliiy and maiuriiy.
Indccndcncc is anoiIcr advaniagc of owning a small lusincss. Onc survcy of small lusincss owncrs
sIowcd iIai 38% of iIosc wIo lcfi iIcir jols ai oiIcr comanics said iIcir main rcason for lcaving was
iIai iIcy wanicd io lc iIcir own losscs.
|ctuton nccdcd|
Frccdom io ocraic indccndcnily is a rcward for
small lusincss owncrs. In addiiion, many colc dcsirc io malc iIcir own dccisions, ialc iIcir own risls,
and rca iIc rcwards of iIcir cfforis. Small lusincss owncrs Iavc iIc saiisfaciion of maling iIcir own
dccisions wiiIin iIc consirainis imoscd ly cconomic and oiIcr cnvironmcnial faciors.
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Howcvcr,
cnircrcncurs Iavc io worl vcry long Iours and undcrsiand iIai uliimaicly iIcir cusiomcrs arc iIcir
losscs.

Scvcral organizaiions, in iIc Uniicd Siaics, also rovidc Icl for iIc small lusincss sccior, sucI as iIc
Inicrnal Fcvcnuc Scrvicc's Small Dusincss and Sclf-Emloycd Onc-Sio Fcsourcc.
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ProbIems Iaced by smaII busInesses
Small lusincsscs oficn facc a variciy of rollcms rclaicd io iIcir sizc. A frcqucni causc of lanlruicy is
undcrcaiializaiion. TIis is oficn a rcsuli of oor lanning raiIcr iIan cconomic condiiions - ii is
common rulc of iIuml iIai iIc cnircrcncur sIould Iavc acccss io a sum of moncy ai lcasi cqual io iIc
rojccicd rcvcnuc for iIc firsi ycar of lusincss in addiiion io Iis aniiciaicd ccnscs. For camlc, if iIc
roscciivc owncr iIinls iIai Ic will gcncraic $100,000 in rcvcnucs in iIc firsi ycar wiiI $150,000 in
siari-u ccnscs, iIcn Ic sIould Iavc no lcss iIan $250,000 availallc. Failurc io rovidc iIis lcvcl of
funding for iIc comany could lcavc iIc owncr liallc for all of iIc comany's dcli sIould Ic cnd u in
lanlruicy couri, undcr iIc iIcory of undcrcaiializaiion.
In addiiion io cnsuring iIai iIc lusincss Ias cnougI caiial, iIc small lusincss owncr musi also lc
mindful of coniriluiion margin (salcs minus variallc cosis}. To lrcal cvcn, iIc lusincss musi lc allc io
rcacI a lcvcl of salcs wIcrc iIc coniriluiion margin cquals ficd cosis. WIcn iIcy firsi siari oui, many
small lusincss owncrs undcrricc iIcir roducis io a oini wIcrc cvcn ai iIcir maimum caaciiy, ii
would lc imossillc io lrcal cvcn. Cosi conirols or ricc incrcascs oficn rcsolvc iIis rollcm.
In iIc Uniicd Siaics, somc of iIc largcsi conccrns of small lusincss owncrs arc insurancc cosis (sucI as
lialiliiy and IcaliI}, rising cncrgy cosis, iacs and ia comliancc
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. In iIc Uniicd Kingdom and
Ausiralia, small lusincss owncrs icnd io lc morc conccrncd wiiI cccssivc govcrnmcnial rcd iac
|7|
.
AnoiIcr rollcm for many small lusincsscs is icrmcd iIc 'Enircrcncurial MyiI' or E-MyiI. TIc myiIic
assumiion is iIai an ccri in a givcn iccInical ficld will also lc ccri ai running iIai lind of lusincss.
Addiiional lusincss managcmcni slills arc nccdcd io lcc a lusincss running smooiIly.
Siill anoiIcr rollcm for many small lusincsscs is iIc caaciiy of mucI largcr lusincsscs io influcncc or
somciimcs dcicrminc iIcir cIanccs for succcss.
MarketIng tbe smaII busIness
Finding ncw cusiomcrs is iIc major cIallcngc for Small lusincss owncrs. Small lusincsscs iyically find
iIcmsclvcs siracd for iimc lui in ordcr io crcaic a coniinual sircam of ncw lusincss, iIcy musi worl
on marlciing iIcir lusincss cvcry day.
Common marlciing iccIniqucs for small lusincss includc nciworling, word of mouiI, cusiomcr
rcfcrrals, ycllow agcs dircciorics, iclcvision, radio, ouidoor (roadsidc lillloards}, rini, cmail marlciing,
and inicrnci. Elccironic mcdia lilc TV can lc quiic ccnsivc and is normally inicndcd io crcaic
awarcncss of a roduci or scrvicc.
Many small lusincss owncrs find inicrnci marlciing morc affordallc. Cooglc AdWords and YaIoo! ScarcI
Marlciing arc iwo oular oiions of gciiing small lusincss roducis or scrviccs in froni of moiivaicd
Wcl scarcIcrs. Succcssful onlinc small lusincss marlcicrs arc also adci ai uiilizing iIc mosi rclcvani
lcywords in iIcir siic conicni. Advcriising on nicIc siics can also lc cffcciivc, lui wiiI iIc long iail of iIc
inicrnci, ii can lc iimc inicnsivc io advcriisc on cnougI siics io garncr an cffcciivc rcacI.
Crcaiing a lusincss Wcl siic Ias lccomc incrcasingly affordallc wiiI many do-ii-yoursclf rograms now
availallc for lcginncrs. A Wcl siic can rovidc significani marlciing cosurc for small lusincsscs wIcn
marlcicd iIrougI iIc Inicrnci and oiIcr cIanncls. Somc oular scrviccs arc WordPrcss, Joomla and
Squarcsacc.
Social mcdia Ias rovcn io lc vcry uscful in gaining addiiional cosurc for many small lusincsscs.
Many small lusincss owncrs usc Facclool and Twiiicr as a way io rcacI oui io iIcir loyal cusiomcrs io

givc iIcm ncws aloui sccials of iIc day or sccial couons and gcncraic rccai lusincss. TIc rclaiional
naiurc of social mcdia, along wiiI iis immcdiacy and 24-Iour rcscncc lcnd iniimacy io iIc rclaiionsIi
small lusincsscs can Iavc wiiI iIcir cusiomcrs, wIilc maling ii morc cfficicni for iIcm io communicaic
wiiI grcaicr numlcrs. Facclool ads arc also a vcry cosi-cffcciivc way for small lusincsscs io rcacI a
iargcicd audicncc wiiI a vcry sccific mcssagc.
In addiiion io iIc social nciworling siics, llogs Iavc lccomc a IigIly cffcciivc way for small lusincsscs io
osiiion iIcmsclvcs as ccris on issucs iIai arc imoriani io iIcir cusiomcrs. TIis can lc donc wiiI a
roriciary llog and/or ly using a lacllinl siraicgy wIcrcin iIc marlcicr commcnis on oiIcr llogs and
lcavcs a linl io iIc small lusincss' own Wcl siic.
A solid ullic rclaiions siraicgy iIai uiilizcs scaling cngagcmcnis, rcss rclcascs, fcaiurc siorics, cvcnis
and sonsorsIis can also lc a vcry cosi-cffcciivc way io luild a loyal following for a small lusincss.
Small lusincsscs oficn join or comc iogciIcr io form organizaiions io advocaic for iIcir causcs or io
acIicvc cconomics of scalc iIai largcr lusincsscs lcncfii from, sucI as iIc ooriuniiy io luy cIcacr
IcaliI insurancc in lull. TIcsc organizaiions includc local or rcgional grous sucI as CIamlcrs of
Commcrcc, as wcll as naiional or inicrnaiional indusiry-sccific organizaiions. SucI grous oficn scrvc a
dual urosc, as lusincss nciworls io rovidc marlciing and conncci mcmlcrs io oicniial salcs lcads
and sulicrs, and also as advocacy grous, lringing iogciIcr many small lusincsscs io rovidc a
sirongcr voicc in rcgional or naiional oliiics.
Small Dusincss Dcvclomcni Ccnicrs (SDDCs}, ocraiing in cacI siaic, rovidc frcc and confidcniial
counscling and low-cosi iraining io small lusincsscs.
QUESTION 3b
Wbat Iactors are IIkeIy to be consIdered by a busIness person beIore decIdIng on tbe cboIce oI
IInance wben borrowIng In tbe busIness?
WIciIcr ii's a morigagc, crsonal loans, crcdii cards or all of iIc alovc, morc and morc colc arc
drowning undcr iIc lurdcn of iIcir dcli, and for iIosc wiiI cnougI incomc io lcc iIcir Icads alovc
waicr, iIc only logical cIoicc may sccm io lc aying off iIcir dclis as quiclly as ossillc. Dui waii -- is
iIai rcally iIc lcsi financial gamc lan? WIilc ii ccriainly fccls good io lc dcli frcc, in somc circmcly
rarc siiuaiions you may lc lciicr off simly mainiaining your dclis (i.c. aying iIc minimum aymcnis
on your loan} and invcsiing your sarc casI. Can'i dccidc wIciIcr io invcsi your cira moncy or usc ii io
ay off your loans? Fcad on for somc iis io Icl you malc iIc cIoicc.
Steps
1. 1
Start a budget -- a spendIng pIan. Dcforc you can cvcn considcr invcsiing, you'vc goi io malc surc iIai
you aciually Iavc cxtu moncy. Fcscrvc cnougI incomc io lcc all your dclis currcni; gciiing lcIind on
your dcli aymcnis can damagc your crcdii and causc you io incur fccs iIai will quiclly ovcrwIclm iIc
rciurn on any invcsimcni. Pay ai lcasi your minimum aymcnis on all your dclis, on iimc, cvcry iimc.

Duild a rainy day fund lcforc invcsiing. TIings may lc looling u now, lui wIai if you losc your jol nci
moniI or you Iavc a mcdical cmcrgcncy? Dcforc you invcsi or malc largcr iIan ncccssary aymcnis on
your loans, savc u somc moncy for an cmcrgcncy fund. Many ccris rccommcnd iIai you savc cnougI
io covcr ai lcasi iIrcc moniIs of your larc-loncs ccnscs. TIis numlcr may vary, Iowcvcr, dccnding
on your siiuaiion and your crsonal rcfcrcnccs. TIis moncy sIould lc in a safc, acccssillc accouni,

sucI as a moncy marlci fund, noi a muiual fund (no guaraniccd rciurn ovcr sIori criods of iimc} or a
CD (noi acccssillc}.
2. 3
TbInk oI debt payments as an Investment. WIcn you malc a $100 aymcni on a loan wiiI a 13%
inicrcsi raic, your annual rciurn is 13%, or $13. WIy? Dccausc you avoid Iaving io ay iIai cira $13 in
iIc fuiurc, wIicI lcavcs you $13 morc iIan you would Iavc oiIcrwisc Iad.
3.
PrIorItIze your debts. Somc financial ccris suggcsi uiiing your dclis in ordcr from iIosc iIai cIargc
iIc IigIcsi inicrcsi raics (oficn crcdii cards} io iIosc iIai cIargc iIc lowcsi (iyically morigagc
aymcnis}. OiIcrs, lilc Davc Famscy (in Iis lool nuncu Pcucc Hcustcd), suggcsi lisiing iIcm from
smallcsi io largcsi, aying off iIc smallcsi dclis firsi wIilc maling minimum aymcnis on iIc rcsi. TIcn,
as iIc smallcsi dcli is aid off, iIc amouni iIai was lcing aid on ii is rollcd u onio iIc nci IigIcsi
dcli, addcd io iIai dcli's minimum aymcni. TIis is callcd iIc "Dcli Snowlall," and can givc a
ircmcndous scnsc of accomlisImcni and cncouragcmcni io anyonc wiiI a largc numlcr of dclis io ay
off.
. 5
Compare tbe annuaI return on Investments io iIc inicrcsi raics on your dcli. WIcn camining an
invcsimcni ooriuniiy, comarc iis raic of rciurn io iIc inicrcsi raics on your dclis. Suosc you'rc
irying io dccidc lciwccn aying off your morigagc carly ly aying an cira $100 cr moniI, or invcsiing
iIai $100 cacI moniI. If your auio loan's inicrcsi raic is 6%, you can gci a lciicr rciurn ly invcsiing iIai
$100 in any invcsimcni iIai yiclds morc iIan 6%. If you'rc considcring a lond iIai ays 5%, Iowcvcr,
you'rc lciicr off aying iIc cira $100 on iIc loan. Also asl yoursclf if you would lorrow ncw moncy ai
iIc dcli raic io invcsi ai iIc invcsimcni raic. If you wouldn'i lorrow ncw moncy, you sIould ay off iIc
dcli lcforc invcsiing.
5. 6
ConsIder tbe tax ImpIIcatIons. Ii's noi cnougI io simly lool ai iIc inicrcsi raic
you'll rcccivc on an invcsimcni or ay on a dcli. You also nccd io considcr wIciIcr
iIc inicrcsi on your invcsimcni is iaallc and wIciIcr iIc inicrcsi on your dcli is
ia-dcduciillc. Tacs can comlicaic iIings a good dcal, so unlcss you arc confidcni
in your aliliiy io navigaic iIc mazc of ia laws and do your own calculaiions, you may
wani io gci ccri Icl from a financial advisor. Considcr iIc following U.S.-lascd
camlcs.
4 Morigagc inicrcsi aymcnis arc usually ia dcduciillc, so iIc ccctuc
inicrcsi raic you ay on your morigagc may lc sulsianiially lowcr iIan
iIc siaicd raic. (Noic. You only lcncfii from iIc ia-dcduciillc naiurc of
morigagc inicrcsi if you iicmizc your dcduciions on your ia rciurn.
Taling iIc siandard dcduciion nulls any crccivcd "lcncfii" of morigagc
inicrcsi.}
4 Ordinary invcsimcnis arc gcncrally suljcci io incomc iacs, wIicI can
dramaiically rcducc iIc rciurn.

4 Ta-dcfcrrcd invcsimcnis, Iowcvcr, sucI as 401(l} lans and iradiiional

IFAs, lowcr your iaallc incomc, and iIus iIc ccctuc rciurn may lc
IigIcr iIan iIc siaicd raic.
6. 7
Pay oII debts tbat bave bIgber Interest rates tban tbe return you can get on
Investments. TIcrc's a good cIancc you can find a rclaiivcly safc invcsimcni iIai
would ay morc iIan iIc inicrcsi on a low-raic morigagc. Ii's quiic a lii Iardcr,
Iowcvcr, io find an invcsimcni iIai offcrs a lciicr rciurn iIan aying off your 21%
crcdii card lalancc wiiIoui an amazing dcgrcc of risl, (unlcss somconc's aying you
io invcsi -- scc iIc ii lclow}. TIus, wiiI your rioriiizcd lisi of dclis in froni of you,
usc your cira moncy io ay off iIosc wiiI iIc IigIcsi inicrcsi raic firsi. AnoiIcr
siraicgy is io ay off any small lalanccs firsi (cvcn if iIcy Iavc low inicrcsi raics}
wIicI frccs u casI flow for invcsiing or for aying off your oiIcr dclis.
7. 8
Invest onIy wben you can reasonabIy expect returns tbat sIgnIIIcantIy exceed tbe
Interest on your debts. Evcniually you'll Iavc aid off your IigI-inicrcsi olligaiions
and lilcly lc allc io find acccially safc invcsimcnis iIai will rovidc a lciicr rciurn
on your moncy iIan aying cira on your lowcr-raic dclis. Ai iIis oini, ii gcncrally
malcs scnsc io invcsi, raiIcr iIan ay anyiIing ovcr iIc minimum aymcnis on your
loans.
4 ConsIder tbe rIsk. UnIIke tbe guaranteed "rciurn" you gci ly aying off
dclis, invcsimcnis carry risl. Low risl invcsimcnis, sucI as inicrcsi-
lcaring savings accounis, CDs, and guaraniccd govcrnmcni londs, arc
rciiy safc, lui iIcy'rc unlilcly io ccccd iIc rciurns you can gci ly
aying off cvcn low-inicrcsi dclis. A widc variciy of oiIcr invcsimcnis,
including siocls and muiual funds, 2u rovidc rciurns iIai lcai cvcn
crcdii card inicrcsi raics, lui iIosc rciurns arc noi ccriain, and you
could cvcn losc your rincial. In gcncral, iIc IigIcr iIc advcriiscd raic
of rciurn, iIc IigIcr iIc risl. You Iavc io considcr your own sI
tocuncc wIcn considcring an invcsimcni.
4 TbInk about your Iuture IInancIaI obIIgatIons. WIcn you aly for a
morigagc or oiIcr forms of crcdii, your inicrcsi raic (iIc cosi of iIc
moncy you wani io lorrow} will dccnd largcly on your crcdii raiing. Onc
of iIc main faciors iIai dcicrmincs your crcdii raiing is iIc amouni of
crcdii you'rc using rclaiivc io iIai availallc io you. TIus in somc cascs,
ii may lcncfii you io ay down dclicvcn if ii lools lilc your moncy can
carn a lciicr rciurn in a rclaiivcly safc invcsimcnilccausc your
imrovcd crcdii rofilc will savc you moncy on a morigagc.

Anotber QuestIon
Wbat are tbe RoIes oI managers? ExpIaIn usIng practIcaI exampIes?
FunctIons oI Managers
Managcrs jusi don'i go oui and IaIazardly crform iIcir rcsonsililiiics. Cood
managcrs discovcr Iow io masicr IIve basIc IunctIons: pIannIng, organIzIng,
staIIIng, IeadIng, and controIIIng.
O PIannIng: TIis sic involvcs maing oui cacily Iow io acIicvc a ariicular
goal. Say, for camlc, iIai iIc organizaiion's goal is io imrovc comany salcs.
TIc managcr firsi nccds io dccidc wIicI sics arc ncccssary io accomlisI iIai
goal. TIcsc sics may includc incrcasing advcriising, invcniory, and salcs siaff.
TIcsc ncccssary sics arc dcvclocd inio a lan. WIcn iIc lan is in lacc, iIc
managcr can follow ii io accomlisI iIc goal of imroving comany salcs.
O OrganIzIng: Aficr a lan is in lacc, a managcr nccds io organizc Icr icam and
maicrials according io Icr lan. Assigning worl and graniing auiIoriiy arc iwo
imoriani clcmcnis of organizing.
O StaIIIng: Aficr a managcr disccrns Iis arca's nccds, Ic may dccidc io lccf u
Iis siaffing ly rccruiiing, sclcciing, iraining, and dcvcloing cmloyccs. A
managcr in a largc organizaiion oficn worls wiiI iIc comany's Iuman
rcsourccs dcarimcni io accomlisI iIis goal.
O eadIng: A managcr nccds io do morc iIan jusi lan, organizc, and siaff Icr
icam io acIicvc a goal. SIc musi also lcad. Lcading involvcs moiivaiing,
communicaiing, guiding, and cncouraging. Ii rcquircs iIc managcr io coacI,
assisi, and rollcm solvc wiiI cmloyccs.
O ControIIIng: Aficr iIc oiIcr clcmcnis arc in lacc, a managcr's jol is noi
finisIcd. Hc nccds io coniinuously cIccl rcsulis againsi goals and ialc any
corrcciivc aciions ncccssary io malc surc iIai Iis arca's lans rcmain on iracl.
All managcrs ai all lcvcls of cvcry organizaiion crform iIcsc funciions, lui iIc
amouni of iimc a managcr scnds on cacI onc dccnds on loiI iIc lcvcl of
managcmcni and iIc sccific organizaiion.
RoIes perIormed by managers
A managcr wcars many Iais. Noi only is a managcr a icam lcadcr, lui Ic or sIc is
also a lanncr, organizcr, cIccrlcadcr, coacI, rollcm solvcr, and dccision malcr
all rollcd inio onc. And iIcsc arc jusi a fcw of a managcr's rolcs.

In addiiion, managcrs' scIcdulcs arc usually jam-aclcd. WIciIcr iIcy'rc lusy wiiI
cmloycc mcciings, uncccicd rollcms, or siraicgy scssions, managcrs oficn find
liiilc sarc iimc on iIcir calcndars. (And iIai docsn'i cvcn includc rcsonding io c-
mail!}
In Iis classic lool, %c Nutuc o Munugcu VoI, Hcnry Minizlcrg dcscrilcs a sci of
icn rolcs iIai a managcr fills. TIcsc rolcs fall inio iIrcc caicgorics.
O InterpersonaI: TIis rolc involvcs Iuman inicraciion.
O InIormatIonaI: TIis rolc involvcs iIc sIaring and analyzing of informaiion.
O DecIsIonaI: TIis rolc involvcs dccision maling.
TabIe 1 coniains a morc in-dciI lool ai cacI caicgory of rolcs iIai Icl managcrs
carry oui all fivc funciions dcscrilcd in iIc rcccding Funciions of Managcrs" scciion.

TABE 1 MIntzberg's Set oI Ten RoIes
Category RoIe ActIvIty
Informaiional Moniior Sccl and rcccivc informaiion; scan criodicals and
rcoris; mainiain crsonal coniaci wiiI
sialcIoldcrs.
Disscminaior Forward informaiion io organizaiion mcmlcrs via
mcmos, rcoris, and Ionc calls.
Solcscrson Transmii informaiion io ouisidcrs via rcoris,
mcmos, and scccIcs.
Inicrcrsonal FigurcIcad Pcrform ccrcmonial and symlolic duiics, sucI as
grcciing visiiors and signing lcgal documcnis.
Lcadcr Dircci and moiivaic sulordinaics; counscl and
communicaic wiiI sulordinaics.
Liaison Mainiain informaiion linls loiI insidc and ouisidc
organizaiion via mail, Ionc calls, and mcciings.
Dccisional Enircrcncur Iniiiaic imrovcmcni rojccis; idcniify ncw idcas

and dclcgaic idca rcsonsililiiy io oiIcrs.

Disiurlancc
Iandlcr
Talc corrcciivc aciion during disuics or criscs;
rcsolvc conflicis among sulordinaics; adai io
cnvironmcnis.
Fcsourcc
allocaior
Dccidc wIo gcis rcsourccs; rcarc ludgcis; sci
scIcdulcs and dcicrminc rioriiics.
Ncgoiiaior Fcrcscni dcarimcni during ncgoiiaiions of union
coniracis, salcs, urcIascs, and ludgcis.

SkIIIs needed by managers
Noi cvcryonc can lc a managcr. Ccriain skIIIs, or aliliiics io iranslaic lnowlcdgc inio aciion iIai rcsulis
in dcsircd crformancc, arc rcquircd io Icl oiIcr cmloyccs lccomc morc roduciivc. TIcsc slills fall
undcr iIc following caicgorics.
O TecbnIcaI: TIis slill rcquircs iIc aliliiy io usc a sccial roficicncy or ccriisc io crform
ariicular iasls. Accounianis, cnginccrs, marlci rcscarcIcrs, and comuicr scicniisis, as
camlcs, osscss iccInical slills. Managcrs acquirc iIcsc slills iniiially iIrougI formal
cducaiion and iIcn furiIcr dcvclo iIcm iIrougI iraining and jol ccricncc. TccInical slills
arc mosi imoriani ai lowcr lcvcls of managcmcni.
O Human: TIis slill dcmonsiraics iIc aliliiy io worl wcll in coocraiion wiiI oiIcrs. Human slills
cmcrgc in iIc worllacc as a sirii of irusi, cniIusiasm, and gcnuinc involvcmcni in
inicrcrsonal rclaiionsIis. A managcr wiiI good Iuman slills Ias a IigI dcgrcc of sclf-
awarcncss and a caaciiy io undcrsiand or cmaiIizc wiiI iIc fcclings of oiIcrs. Somc managcrs
arc naiurally lorn wiiI grcai Iuman slills, wIilc oiIcrs imrovc iIcir slills iIrougI classcs or
ccricncc. No maiicr Iow Iuman slills arc acquircd, iIcy'rc criiical for all managcrs lccausc of
iIc IigIly inicrcrsonal naiurc of managcrial worl.
O ConceptuaI: TIis slill calls for iIc aliliiy io iIinl analyiically. Analyiical slills cnallc managcrs
io lrcal down rollcms inio smallcr aris, io scc iIc rclaiions among iIc aris, and io rccognizc
iIc imlicaiions of any onc rollcm for oiIcrs. As managcrs assumc cvcr-IigIcr rcsonsililiiics
in organizaiions, iIcy musi dcal wiiI morc amliguous rollcms iIai Iavc long-icrm
conscqucnccs. Again, managcrs may acquirc iIcsc slills iniiially iIrougI formal cducaiion and
iIcn furiIcr dcvclo iIcm ly iraining and jol ccricncc. TIc IigIcr iIc managcmcni lcvcl, iIc
morc imoriani concciual slills lccomc.
AliIougI all iIrcc caicgorics coniain slills csscniial for managcrs, iIcir rclaiivc imoriancc icnds io vary
ly lcvcl of managcrial rcsonsililiiy.
Dusincss and managcmcni cducaiors arc incrcasingly inicrcsicd in Icling colc acquirc iccInical,
Iuman, and concciual slills, and dcvclo sccific comcicncics, or sccializcd slills, iIai coniriluic io
IigI crformancc in a managcmcni jol. Following arc somc of iIc slills and crsonal cIaracicrisiics iIai
iIc Amcrican Asscmlly of Collcgiaic ScIools of Dusincss (AACSD} is urging lusincss scIools io Icl iIcir
siudcnis dcvclo.
O eadersbIp aliliiy io influcncc oiIcrs io crform iasls

O SeII-objectIvIty aliliiy io cvaluaic yoursclf rcalisiically

O AnaIytIc tbInkIng aliliiy io inicrrci and clain aiicrns in informaiion
O BebavIoraI IIexIbIIIty aliliiy io modify crsonal lcIavior io rcaci oljcciivcly raiIcr iIan
suljcciivcly io accomlisI organizaiional goals
O OraI communIcatIon aliliiy io crcss idcas clcarly in words
O WrItten communIcatIon aliliiy io crcss idcas clcarly in wriiing
O PersonaI Impact aliliiy io crcaic a good imrcssion and insiill confidcncc
O Resistance to stress ability to perIorm under stressIul conditions
O Tolerance for uncertainty ability to perIorm in ambiguous situations

QUESTION 6
DescrIbe and expIaIn bow eIIectIve HRM can contrIbute to tbe accompIIsbment oI tbe organIzatIon
objectIves?
Managing colc cffcciivcly in cicnsion rogrammcs is a slill iIai rcquircs consiani lanning and
dcvclomcni. An cicnsion rogrammc managcr can lc dcfincd as iIc crson wIo is vcsicd wiiI formal
auiIoriiy ovcr an organizaiion or onc of iis sul uniis. Hc or sIc Ias siaius iIai lcads io various
inicrcrsonal rclaiions, and from iIis comcs acccss io informaiion. Informaiion, in iurn, cnallcs iIc
managcr io dcvisc siraicgics, malc dccisions, and imlcmcni aciion (Minizlcrg, 1988}. Managcmcni is
conccrncd wiiI iIc oiimum aiiainmcni of organizaiional goals and oljcciivcs wiiI and iIrougI oiIcr
colc. Eicnsion managcmcni organizaiions arc cIaracicrizcd ly many siraicgics, widc sans of conirol,
dcmocracy, and auionomy. TIcir managcmcni raciiccs cannoi lc rcduccd io onc siandard sci of
ocraiing guidclincs iIai will worl for all organizaiions coniinually. Howcvcr, all managcrs of rofcssional
organizaiions facc iIc samc cIallcngc. io managc onc's iimc, oljcciivcs, and rcsourccs in ordcr io
accomlisI iasls and imlcmcni idcas (Waldron, 1994}.
Managcrs of cicnsion rogrammcs arc ainfully awarc of iIc nccd for rcvision and dcvclomcni of iIc
ncw slill scis Icld ly ioday's IigI crformcrs. If cIangc is noi Iandlcd corrccily, ii can lc morc
dcvasiaiing iIcn cvcr lcforc. HigI crformcrs rcflcci, discovcr, asscss, and aci. TIcy lnow iIai a ncw
focus on conncciing iIc Icads, Icaris, and Iands of colc in iIcir organizaiion is ncccssary. Asiuic
managcrs lnow wIai nccds io lc donc lui sirugglc wiiI Iow io do ii. Quiic oficn iIcy rcfcr io considcr
iIcmsclvcs as icacIcrs or communicaiors raiIcr iIan managcrs. TIis rcsulis in undcr-uiilizaiion of iIc
incrcasing amouni of liicraiurc on managcmcni iIcory and raciicc. TIc rooi of iIc rollcm is
imlcmcniaiion. TIcy musi lcarn Iow io moiivaic oiIcrs and luild an cfficicni icam.
Morc formally dcfincd, managcmcni is iIc roccss ly wIicI colc, iccInology, jol iasls, and oiIcr
rcsourccs arc comlincd and coordinaicd so as io cffcciivcly acIicvc organizaiional oljcciivcs. A roccss or
funciion is a grou of rclaicd aciiviiics coniriluiing io a largcr aciion. Managcmcni funciions arc lascd
on a common IilosoIy and aroacI. TIcy ccnirc around iIc following.
1. Dcvcloing and clarifying mission, olicics, and oljcciivcs of iIc agcncy or organizaiion
2. EsiallisIing formal and informal organizaiional siruciurcs as a mcans of dclcgaiing auiIoriiy and
sIaring rcsonsililiiics

3. Sciiing rioriiics and rcvicwing and rcvising oljcciivcs in icrms of cIanging dcmands
4. Mainiaining cffcciivc communicaiions wiiIin iIc worling grou, wiiI oiIcr grous, and wiiI iIc largcr
communiiy
5. Sclcciing, moiivaiing, iraining, and araising siaff
6. Sccuring funds and managing ludgcis; cvaluaiing accomlisImcnis and
7. Dcing accouniallc io siaff, iIc largcr cnicrrisc, and io iIc communiiy ai largc (Waldron, 1994l}.
TIc managcmcni funciions lisicd alovc can lc caicgorizcd ly using iIc acronym POSDCOFD (Donoma &
Slcvin, 1978, from Culicl & Urwicl, 1959}.
g PIannIng: ouilining IilosoIy, olicy, oljcciivcs, and rcsuliani iIings io lc accomlisIcd, and iIc
iccIniqucs for accomlisImcni
g OrganIzIng: csiallisIing siruciurcs and sysicms iIrougI wIicI aciiviiics arc arrangcd, dcfincd, and
coordinaicd in icrms of somc sccific oljcciivcs
g StaIIIng: fulfilling iIc crsonncl funciion, wIicI includcs sclcciing and iraining siaff and mainiaining
favourallc worl condiiions
g DIrectIng: maling dccisions, cmlodying dccisions in insiruciions, and scrving as iIc lcadcr of iIc
cnicrrisc
g CoordInatIng: inicrrclaiing iIc various aris of iIc worl
g ReportIng: lccing iIosc io wIom you arc rcsonsillc, including loiI siaff and ullic, informcd
g BudgetIng: maling financial lans, mainiaining accouniing and managcmcni conirol of rcvcnuc, and
lccing cosis in linc wiiI oljcciivcs
PIannIng
Planning is iIc lcy managcmcni funciion of any cicnsion worlcr. Ii is iIc roccss of dcicrmining in
advancc wIai sIould lc accomlisIcd, wIcn, ly wIom, Iow, and ai wIai cosi. Fcgardlcss of wIciIcr ii
is lanning long-icrm rogram rioriiics or lanning a iwo-Iour mcciing, iIc lanning ascci of
managcmcni is iIc major coniriluior io succcss and roduciiviiy. Siaicd simly, "If you don'i lnow
wIcrc you arc going, iIcn you won'i lnow wIcn you Iavc arrivcd!" Planning is iIc roccss of dcicrmining
iIc organizaiion's goals and oljcciivcs and maling iIc rovisions for iIcir acIicvcmcni. Ii involvcs
cIoosing a coursc of aciion from availallc alicrnaiivcs.
Planning is iIc roccss of dcicrmining organizaiional aims, dcvcloing rcmiscs aloui iIc currcni
cnvironmcni, sclcciing iIc coursc of aciion, iniiiaiing aciiviiics rcquircd io iransform lans inio aciion,
and cvaluaiing iIc ouicomc. TIc iycs of lanning iIai managcrs cngagc in will dccnd on iIcir lcvcl in
iIc organizaiion and on iIc sizc and iyc of iIc organizaiion. Ccncrally iIcrc arc four major iycs of
lanning ccrciscs. siraicgic, iaciical, coniingcncy, and managcrial. Siraicgic lanning involvcs
dcicrmining organizaiional goals and Iow io acIicvc iIcm. TIis usually occurs ai iIc io managcmcni
lcvcl. Taciical lanning is conccrncd wiiI imlcmcniing iIc siraicgic lans and involvcs middlc and lowcr
managcmcni. Coniingcncy lanning aniiciaics ossillc rollcms or cIangcs iIai may occur in iIc
fuiurc and rcarcs io dcal wiiI iIcm cffcciivcly as iIcy arisc (MarsIall, 1992}. Managcrial lanning is
usually considcrcd as microlcvcl lanning. Ii Icls in comlining rcsourccs io fulfil iIc ovcrall oljcciivcs
of iIc cicnsion organizaiion.

A nccds asscssmcni may iniiiaic a nccd for dcvcloing a lan. TIc lanning roccss lcgins wiiI iIc
crcaiion of a IilosoIy iIai consisis of siaicmcnis dcscriling iIc valucs, lclicfs, and aiiiiudcs of iIc
organizaiion. Iis mission siaicmcni is a roclamaiion of iis urosc or rcason for lcing. Aficr iIc
IilosoIy and mission siaicmcnis Iavc lccn csiallisIcd, various goals and oljcciivcs arc dcfincd. Coals
arc usually gcncral siaicmcnis iIai rojcci wIai is io lc accomlisIcd in iIc fuiurc. An oljcciivc is a
concrcic siaicmcni dcscriling a sccific aciion. Policics arc rcdcicrmincd guidcs io dccision maling;
iIcy csiallisI loundarics or limiis wiiIin wIicI aciion may lc ialcn. Managcrs arc rclaicd io olicy
formaiion in iwo ways. Firsi, iIcy lay a crucial rolc in imlcmcniing organizaiional olicics iIai Iavc
lccn csiallisIcd ly IigIcr managcmcni. Sccond, iIcy crcaic olicics wiiIin iIcir dcarimcnis as guidcs
for iIcir own worl grous. Proccdurcs ouilinc iIc scrics of sics io lc followcd wIcn carrying oui a
dcsigncd olicy or ialing a ariicular coursc of aciion. Fulcs arc uscd io rovidc final and dcfiniic
insiruciion. Usually iIcy arc inflcillc.
Planning is dcsigning iIc fuiurc, aniiciaiing rollcms, and imagining succcss. In sIori, lanning is
csscniial for anyonc wIo wanis io survivc. TIc funciions of organizing, lcading, siaffing, and ludgciing
arc mcans of carrying oui iIc dccisions of lanning. Evcryonc is a lanncr - a lanncr of mcals, of worl
iimc, Of vacaiions, of familics. Formal lanning, Iowcvcr, disiinguisIcs managcrs from non-managcrs,
cffcciivc managcrs from incffcciivc managcrs. Formal lanning forccs managcrs io iIinl of iIc fuiurc, io
sci rioriiics, io cncouragc crcaiiviiy, io ariiculaic clcar oljcciivcs, and io forccasi iIc fuiurc in icrms of
aniiciaicd rollcms and oliiical rcaliiics.
ong-Range PIannIng
Long-rangc lanning is viially imoriani in iIai ii focuscs aiicniion on crucial fuiurc issucs wIicI arc
viially imoriani io iIc organizaiion. Ii involvcs siudying socicial ircnds and issucs, survcying currcni
and aniiciaicd lcarncrs' nccds, and lcing awarc of long-icrm rcscarcI dircciions and cIangcs in
iccInology. Many cicnsion worlcrs may iIinl iIai sucI managcmcni is lcyond iIcir lcvcl of auiIoriiy,
conirol, or involvcmcni. TIcy may fccl iIai sucI managcmcni is iIc rcrogaiivc of iIc dirccior, iIc
dcuiy minisicr, or iIc rcsidcni. Howcvcr, wIilc scnior lcvcls of managcmcni musi lc involvcd, iIosc
wIo imlcmcni iIc oljcciivcs rcsuliing from long-rangc lanning sIould also lc involvcd.
StrategIc PIannIng
Siraicgic lanning Ias lccn dcfincd as iIai wIicI Ias io do wiiI dcicrmining iIc lasic oljcciivcs of an
organizaiion and allocaiing rcsourccs io iIcir accomlisImcni. A siraicgy dcicrmincs iIc dircciion in
wIicI an organizaiion nccds io movc io fulfil iis mission. A siraicgic lan acis as a road ma for carrying
oui iIc siraicgy and acIicving long-icrm rcsulis. Occasionally a largc ga cisis lciwccn iIc siraicgic
lan and rcal rcsulis. To loosi organizaiional crformancc, colc musi lc a lcy ari of iIc siraicgy. A
sirongcr, morc caallc and cfficicni organizaiion can arisc ly dcfining Iow iis mcmlcrs can suori iIc
ovcrall siraicgy (Figurc 1}.
Siraicgic lanning is diffcrcni from long-icrm lanning. Long-rangc lanning luilds on currcni goals and
raciiccs and rooscs modificaiions for iIc fuiurc. Siraicgic lanning, Iowcvcr, considcrs cIangcs or
aniiciaicd cIangcs in iIc cnvironmcni iIai suggcsi morc radical movcs away from currcni raciiccs.
WIcn doing siraicgic lanning, iIc organizaiion sIould cmIasizc icam lanning. Dy involving iIosc
affccicd ly iIc lan, iIc mangcr luilds an organizaiion widc undcrsianding and commiimcni io iIc
siraicgic lan (Flcmming, 1989}. TIc clcmcnis of siraicgic lans includc.
Organizaiion mission siaicmcni - WIai
Siraicgic analysis - WIy
Siraicgic formulaiion - WIcrc
Long-icrm oljcciivcs imlcmcniaiion - WIcn and How
Ocraiional lans - WIcn and How

CIangcs arc csscniial io lciicr osiiion iIc cicnsion organizaiion and focus on clicni nccds and moving
forward in rural dcvclomcni and susiainaliliiy rogrammcs. TIc sircngiI and rcsilicncc of iIc
iradiiional rural and farm oulaiion and iIc ircnd iowards a dcccniralizcd sociciy wiiI morc and morc
urlaniics moving io iIc couniry suggcsi iIai succcssful rural communiiics will dccnd on colc's aliliiy
io cIangc, io adai, and io worl ioward a lciicr fuiurc. In iIc 1990s, faciliiaiing farmcr ariiciaiion is a
major cicnsion aciiviiy (CIamlcrs, 1993}. Fcorganizaiion rovidcs a framcworl for longcr-icrm
commiimcni io rural dcvclomcni. Organizaiions and sul uniis arc lcing cncouragcd io ui worl icams
in lacc io cnsurc iIai cacI sccior inicgraics siaff and scrviccs inio a coIcsivc, focuscd lusincss unii.
Consuliaiion and ariiciaiion arc lclicvcd io lc csscniial for iIc succcssful dcvclomcni and
imlcmcniaiion of organizaiional goals and oljcciivcs. EacI worl icam is aslcd io dcvclo an cffcciivc
roccss for discussion of major cIallcngcs and ooriuniiics facing iIc organizaiion, if ossillc, ovcr iIc
nci dccadc. Udaicd siraicgic lans arc iIcn dcvclocd. TIcsc lans form iIc framcworl for focusing
organizaiional rcsourccs on iIc mosi siraicgic arcas ly using a siagcd aroacI. Udaicd lans arc iIcn
imlcmcnicd ly worl icams ai all lcvcls of managcmcni. Worl-icam oljcciivcs includc.
1. Involving all lcvcls of siaff in consuliaiion
2. Dcsigning and imlcmcniing a roccss io dcvclo-goals and oljcciivcs for iIc organizaiion and unii; a
siraicgic roccss for iIc nci fivc io icn ycars
3. Dcfining and clarifying organizaiional siruciurcs and idcniifying funciions, cusiomcrs, and scrvicc
dclivcry modcls
4. Idcniifying cIangcs and siagcd aroacIcs nccdcd io movc from iIc currcni siiuaiion io wIai will lc
rcquircd ovcr iIc nci iIrcc io fivc ycars
5. Idcniifying and rccommcnding rioriiics for olicy and rogrammc dcvclomcni
6. Incororaiing goals for ccndiiurc rcduciion, scrvicc qualiiy imrovcmcni, worlforcc managcmcni,
accounialiliiy, iccInology, and lusincss roccss imrovcmcni
7. Siaiing iIc siari daic and firsi rcori daic
FIgure 1. StrategIc pIannIng modeI (Source: OMAD StrategIc PIannIng Factsbeet, 1991).
ManagerIaI PIannIng
If long-rangc lanning can lc linlcd io "macro," iIcn managcrial lanning can lc linlcd io "micro."
Managcrial lanning is iIc imlcmcniing of iIc siraicgic lan; ii is iIc comlining of rcsourccs io fulfil iIc
ovcrall oljcciivcs and missions of iIc organizaiion. Managcrial lanning focuscs on iIc aciiviiy of a
sccific unii and involvcs wIai nccds io lc donc, ly wIom, wIcn, and ai wIai cosi. TIc siraicgic
lanning roccss scrvcs as an umlrclla ovcr iIc managcmcni lanning roccss wIicI dcals wiiI iIc
following.
1. EsiallisIing individual goals and oljcciivcs
2. Forccasiing rcsulis and oicniial rollcms
3. Dcvcloing alicrnaiivcs, sclcciing alicrnaiivcs, and sciiing rioriiics
4. Dcvcloing associaicd ludgcis
5. EsiallisIing crsonncl inuis
6. EsiallisIing sccific olicics rclaicd io iIc unii
7. Allocaiing Iysical rcsourccs
8. Araising Iow iIc managcmcni unii Ias succccdcd in mcciing iis goals and oljcciivcs
DecIsIon makIng

Closcly rclaicd io loiI siraicgic and managcrial lanning is iIc roccss of dccision maling. Dccisions
nccd io lc madc wiscly undcr varying circumsianccs wiiI diffcrcni amounis of lnowlcdgc aloui
alicrnaiivcs and conscqucnccs. Dccisions arc conccrncd wiiI iIc fuiurc and may lc madc undcr
condiiions of ccriainiy, condiiions of risl, or condiiions of unccriainiy. Undcr condiiions of ccriainiy,
managcrs Iavc sufficicni or comlcic informaiion and lnow cacily wIai iIc ouicomc of iIcir dccision
will lc. Managcrs arc usually faccd wiiI a lcss ccriain cnvironmcni. TIcy may, Iowcvcr, lnow iIc
rolaliliiics and ossillc ouicomcs of iIcir dccisions, cvcn iIougI iIcy cannoi guaranicc wIicI
ariicular ouicomc will aciually occur. In sucI cascs, iIcrc is a risl associaicd wiiI iIc dccision and
iIcrc is a ossililiiy of an advcrsc ouicomc. Mosi managcrial dccisions involvc varying dcgrccs of
unccriainiy. TIis is a lcy ari of a managcr's aciiviiics. TIcy musi dccidc wIai goals or ooriuniiics will
lc ursucd, wIai rcsourccs arc availallc, and wIo will crform dcsignaicd iasls. Dccision maling, in
iIis conici, is morc iIan maling u your mind. Ii consisis of scvcral sics.
Sic 1. Idcniifying and dcfining iIc rollcm
Sic 2. Dcvcloing various alicrnaiivcs
Sic 3. Evaluaiing alicrnaiivcs
Sic 4. Sclcciing an alicrnaiivc
Sic 5. Imlcmcniing iIc alicrnaiivc
Sic 6. Evaluaiing loiI iIc aciual dccision and iIc dccision-maling roccss
Managcrs Iavc io vary iIcir aroacI io dccision maling, dccnding on iIc ariicular siiuaiion and
crson or colc involvcd. TIc alovc sics arc noi a ficd roccdurc, Iowcvcr; iIcy arc morc a roccss, a
sysicm, or an aroacI. TIcy forcc onc io rcalizc iIai iIcrc arc usually alicrnaiivcs and iIai onc sIould
noi lc rcssurcd inio maling a quicl dccision wiiIoui looling ai iIc imlicaiions. TIis is csccially iruc
in iIc casc of nonrogrammcd dccisions (comlc and novcl dccisions} as conirasicd io rogrammcd
dccisions (iIosc iIai arc rcciiiivc and rouiinc}.
Onc of iIc mosi difficuli sics in iIc dccision-maling roccss is io dcvclo iIc various alicrnaiivcs. For
camlc, if onc is involvcd in lanning a worlsIo, onc of iIc mosi crucial dccisions is iIc iimc, formai,
and locaiion of iIc worlsIo. In iIis casc, onc's ccricncc as wcll as onc's undcrsianding of iIc clicniclc
grou grcaily influcncc iIc sclcciing of alicrnaiivcs. Oficn dccision irccs can Icl a managcr malc a
scrics of dccisions involving unccriain cvcnis. A dccision ircc is a dcvicc iIai dislays graIically iIc
various aciions iIai a managcr can ialc and sIows Iow iIosc aciions will rclaic io iIc aiiainmcni of
fuiurc cvcnis. EacI lrancI rcrcscnis an alicrnaiivc coursc of aciion. To malc a dccision ircc ii is
ncccssary io. (1} idcniify iIc oinis of dccision and alicrnaiivcs availallc ai cacI oini, (2} idcniify iIc
oinis of unccriainiy and iIc iyc or rangc of alicrnaiivc ouicomcs ai cacI oini, (3} csiimaic iIc
rolaliliiics of diffcrcni cvcnis or rcsulis of aciion and iIc cosis and gains associaicd wiiI iIcsc aciions,
and (4} analysc iIc alicrnaiivc valucs io cIoosc iIc nci coursc of aciion.
In cicnsion, iIc dccision-maling roccss is oficn a grou roccss. Conscqucnily, iIc managcr musi
aly rincilcs of dcmocraiic dccision maling sincc iIosc involvcd in iIc dccision-maling roccss will
fccl an inicrcsi in iIc rcsulis of iIc roccss. In sucI a casc, iIc managcr lccomcs morc of a coacI,
lnowing iIc mission, oljcciivcs, and iIc roccss, lui involving iIosc laycrs wIo musi Icl in aciually
acIicving iIc goal. TIc cffcciivc managcr iIus crccivcs Iimsclf or Icrsclf as iIc conirollcr of iIc
dccision-maling roccss raiIcr iIan as iIc malcr of iIc organizaiion's or agcncy's dccision. As Druclcr
(1966} Ias oinicd oui, "TIc mosi common sourcc of misialcs in managcmcni dccision-maling is iIc
cmIasis on finding iIc rigIi answcr raiIcr iIan iIc rigIi qucsiion. Ii is noi cnougI io find iIc rigIi

answcr; morc imoriani and morc difficuli is io malc cffcciivc iIc coursc of aciion dccidcd uon.
Managcmcni is noi conccrncd wiiI lnowlcdgc for iis own salc; ii is conccrncd wiiI crformancc."
OrganIzIng
Oncc siraicgic lanning and managcmcni lanning arc imlcmcnicd, organizing io gci iIc jol donc is
nci. Organizing is iIc roccss of csiallisIing formal rclaiionsIis among colc and rcsourccs in ordcr
io rcacI sccific goals and oljcciivcs. TIc roccss, according io MarsIall (1992}, is lascd on fivc
organizing rincilcs. uniiy of command, san of conirol, dclcgaiion of auiIoriiy, Iomogcncous
assignmcni, and flcililiiy. TIc organizing roccss involvcs fivc sics. dcicrmining iIc iasls io lc
accomlisIcd, suldividing major iasls inio individual aciiviiics, assigning sccific aciiviiics io
individuals, roviding ncccssary rcsourccs, and dcsigning iIc organizaiional rclaiionsIis nccdcd.
In any organizing cffori, managcrs musi cIoosc an aroriaic siruciurc. Organizaiional siruciurc is
rcrcscnicd rimarily ly an organizaiional cIari. Ii sccifics wIo is io do wIai and Iow ii will lc
accomlisIcd. TIc organizing siagc rovidcs dircciions for acIicving iIc lanning rcsulis. TIcrc arc
scvcral asccis io organizing - iimc, siruciurcs, cIain of command, dcgrcc of ccniralizaiion, and rolc
sccificaiion.
TIme Management
Managcrs musi dccidc wIai io do, wIcn, wIcrc, Iow, and ly or wiiI wIom. Timc managcmcni is iIc
roccss of moniioring, analysing, and rcvising your lan uniil ii worls. Effcciivc lanning is a slill iIai
ialcs iimc io acquirc. Ii is difficuli io imlcmcni lccausc you Iavc no onc lui yoursclf io moniior Iow
cffcciivcly you arc using your iimc. Evcryonc Ias iIc samc amouni of iimc - 168 Iours cr wccl. How
iIai iimc is managcd is u io iIc discrciion of cacI crson. Onc cicnsion agcni jolcd iIai Ic was so
lusy ialing iimc managcmcni courscs, Ic Iad liiilc iimc lcfi io managc. Effcciivc iimc managcmcni
involvcs IilosoIy and common scnsc. Timc is noi a rcncwallc rcsourcc - oncc ii is gonc, ii is gonc
forcvcr. To funciion cffcciivcly, managcrs Iavc io lc allc io rioriiizc and rclacc lcss imoriani iasls
wiiI morc imoriani oncs. Mosi of us worl for ay for only 1,800 Iours cr ycar. Effcciivc and cfficicni
iimc managcmcni cncouragcs us io acIicvc and lc roduciivc wIilc dcvcloing good cmloycc rclaiions.
Coals sIould lc sccific, mcasurallc, aiiainallc, rcalisiic, and iimcly (SMAFT}. Oncc iIc goals arc
lnown, ii is imoriani io iIinl aloui Iow iIcy can lc acIicvcd. Effcciivc iimc managcrs faciliiaic
lanning ly lisiing iasls iIai rcquirc iIcir aiicniion, csiimaiing iIc amouni of iimc cacI iasl will ialc io
comlcic, and rioriiizing iIcm - dcciding wIai iasls arc mosi imoriani io do firsi and numlcring iIcm
in ranl ordcr. Ii is csscniial io lnow wIai is crucial and wIai is noi. Somc aciiviiics Iavc rclaiivcly low
lcvcls of imoriancc in comlciing a givcn iasl. Dy lanning aIcad, managcrs can dccidc wIai io do and
ialc iIc iimc io comc u wiiI idcas on Iow io do ii. TIcy can malc iIcir own lisi of sics io climinaic or
rcducc iimc wasicrs. Mainiaining a daily "To Do" lisi wiiI rioriiics aiiacIcd and mainiaining a daily,
wcclly, moniIly, and ycarly diary is Iclful. Managcrs sIould analysc iIcir daily aciiviiics io scc wIicI
arc dirccicd ioward rcsulis and wIicI arc simly aciiviiics. TIcy could lcarn Iow io managc mcciings
morc cffcciivcly sincc considcrallc managcmcni iimc sccms io lc wasicd in nondircciional formal
mcciings.
Onc of iIc mciIods iIai Icls allocaic iimc according io rioriiics is Parcio's Law or iIc 80/20 rulc. if all
iicms arc arrangcd in ordcr of valuc, 80 cr ccni of iIc valuc will comc from 20 cr ccni of iIc iicms. For
camlc, 80 cr ccni of iIc comlaining in your dcarimcni is lilcly io lc donc ly 20 cr ccni of your
siaff. Four suggcsiions for lciicr iimc managcmcni arc (1} ncvcr Iandlc iIc samc iccc of acr iwicc; (2}
lcarn Iow io say "no" wiiIoui fccling guiliy aloui rcqucsis iIai do noi coniriluic io iIc acIicvcmcni of
your goals; (3} wIcn a visiior dros in io your officc, siand u wIilc you Iavc your discussion io cnsurc
iIai only a lricf criod of iimc will lc consumcd ly iIc visiior's inicrruiion; and (4} avoid lcing a slavc
io iIc iclcIonc. Dy managing iimc wcll, managcrs arc lciicr allc io solvc rollcms quiclly, malc

dccisions, avoid frusiraiion, lcc from gciiing loggcd down in day-io-day iasls, Iandlc criscs, worl on
iIcir goals and rioriiics, and managc sircss. Cuidclincs for scIcduling iimc includc.
1. Always ui your scIcdulc in wriiing.
2. Focus on iIc oljcciivcs you arc irying io accomlisI.
3. Coniinually rcvicw oljcciivcs, rioriiics, and scIcdulcd aciions io lcc on iracl.
4. ScIcdulc around lcy cvcnis and aciions.
5. Cci a roduciivc siari ly scIcduling carly-day aciions.
6. Crou rclaicd iicms and aciions wIcncvcr ossillc.
7. Do noi Icsiiaic io ialc largc iimc llocls for imoriani iasls.
8. Dc surc io allow cnougI iimc for cacI iasl, lui noi ioo mucI iimc.
9. Duild in flcililiiy for uncccicd cvcnis.
10. Includc somc iIinling iimc for yoursclf.
11. Considcr Iow io malc waiiing and iravcl iimc uscful or oiIcrwisc roduciivc.
12. Try io maicI your worl cyclcs io your lody cyclcs.
13. Lcarn io conirol your unscIcdulcd aciion imulscs.
14. Prcarc iomorrow's scIcdulc lcforc you gci io iIc officc in iIc morning.
Structures: CentraIIzed versus DecentraIIzed, Ine versus StaII
Worling roduciivcly and dcvcloing fcclings of coocraiion and cffcciivcncss arc rclaicd io Iaving iIc
rigIi colc doing iIc rigIi jols. Siruciurc, iIcn, can lc dcfincd as a sysicm of inicrrclaicd jols, grous
of jols, and auiIoriiy. TIcrc is no siandard organizaiional siruciurc, lui mosi organizaiions and
agcncics follow iIc "CIrisimas Trcc" sysicm wiiI iIc siar (c.g., rcsidcni, minisicr} ai iIc io, smallcr
lrancIcs ai managcmcni lcvcls, and liggcr lrancIcs ai iIc roduciion lcvcls. Somc would claim iIai iIc
lowcr lrancIcs suori iIc ucr lrancIcs, lui as in iIc ircc, iIc lrancIcs arc suoricd ly a singlc
irunl, wIicI can lc iIougIi of as iIc organizaiional mission and oljcciivcs. EacI ari of iIc ircc Ias iis
sccific funciion. WIcn all aris worl iogciIcr, iIc sysicm survivcs, funciions roduciivcly, Ias lalancc,
and is a lcasurc io scc! TIcrc arc four rimary clcmcnis in dcsigning an organizaiional siruciurc.
1. Jol sccificaiions - wIai cacI division/officc/unii is rcsonsillc for
2. Dcarimcnializaiion - iIc grouing of jols and rcsonsililiiics in common scciors wiiI iIc oljcciivc of
acIicving coordinaiion
3. San of conirol - a dcfiniiion of Iow many jol rolcs sIould lc in cacI unii and wIicI rolcs rcquirc
coordinaiion ly a unii managcr
4. Dclcgaiion of auiIoriiy - assigning iIc rigIi io malc dccisions wiiIoui Iaving io oliain aroval from
a sucrvisor
TIc rcsuliing organizaiional siruciurc will vary according io iIcsc four clcmcnis. An organizaiion wiiI
dcccniralizcd auiIoriiy and vcry Icicrogcncous dcarimcnis will acar vcry diffcrcni from onc wiiI
ccniralizcd auiIoriiy and a vcry Iomogcncous roduci.
CbaIn oI Command
Oncc an organizaiion siaris dclcgaiing auiIoriiy, iIcn iIcrc is auiomaiically a cIain of command, "iIc
formal cIanncl wIicI sccifics iIc auiIoriiy, rcsonsililiiy and communicaiion rclaiionsIis from io io
loiiom in an organizaiion" (IvanccvicI, Donnclly, & Cilson, 1980}. TIus auiIoriiy flows from rcsidcnis
io vicc-rcsidcnis io divisional managcrs, from minisicrs io dcuiics io dircciors, from rincials io vicc-
rincials io dcans, cic. In comlc organizaiions, iIcrc may lc lridgcs from onc lcvcl io anoiIcr and
iIcrc will lc comlc roccdurcs for mainiaining iIc cIain of command. Aduli and cicnsion cducaiors,
if worling for an organizaiion or agcncy, will lc ari of a siruciurc and ari of iIc cIain of command.

Onc cannoi oficn malc major cIangcs in iIcsc iwo clcmcnis; ii is wisc, Iowcvcr, io lc vcry awarc of iIc
organizaiional siruciurc and cIain of command if you wisI io accomlisI iIings cfficicnily.
Ccniralizcd organizaiions arc iIosc in wIicI iIc lcy auiIoriiy and dccision-maling rolc is focuscd on onc
or a vcry fcw individuals. WIcrc auiIoriiy is disiriluicd among many managcrs, iIcn onc can scc a
dcccniralizcd siruciurc. As iIc organizaiion's various rolcs lccomc morc divcrsc in icrms of rogrammc,
roduci, or gcograIical locaiion, onc can scc a morc dcccniralizcd organizaiional siruciurc wiiI
auiIoriiy lcing dclcgaicd io iIosc wIo arc closcsi io iIc aciion. Ccniralizaiion rcfcrs io auiIoriiy,
wIcrcas ccniraliiy rcfcrs io iIc roimiiy io iIc organizaiion's siaicd mandaic and oljcciivcs. Onc could
Iavc a vcry dcccniralizcd organizaiion wiiI cacI unii lcing rcsonsillc for rogrammcs, siaffing, and
ludgci, and yci lc vcry closc io iIc main mission and oljcciivcs of iIc organizaiion.
AnoiIcr imoriani oini in icrms of siruciurc is iIc concci of linc and siaff funciions. Linc funciions arc
iIosc involvcd in crcaiing, dcvcloing, and dclivcring a rogrammc. Siaff funciions arc iIosc iIai arc of
an advisory and consuliaiivc ordcr. Linc funciions coniriluic dirccily io iIc aiiainmcni of iIc
organizaiion's oljcciivcs, and siaff funciions coniriluic indirccily.
StaIIIng
A lcy ascci of managing an aduli and cicnsion cnicrrisc is io find iIc rigIi colc for iIc rigIi jols.
MucI of onc's succcss as a managcr is rclaicd io aroriaic Iuman rcsourcc lanning, rcgardlcss of
wIciIcr ii is iIc Iiring of a sccrciary or an insirucior for a ariicular worl-sIo. TIc siaffing funciion
consisis of scvcral clcmcnis.
1. Human resource pIannIng - Iow many siaff rcsourccs, wiiI wIai laclgrounds, and ai wIai cosi can
lc considcrcd for oljcciivcs imlcmcniaiion?
2. RecruItment - Iow docs onc rocccd io find iIc crson wiiI iIc aroriaic mi of cducaiion,
ccricncc, Iuman rclaiions slills, communicaiions slills, and moiivaiion? An imoriani comoncni of
iIc rccruiimcni roccss is wriiing iIc jol dcscriiion. TIc dcscriiion musi lc caci and sccific lui
sufficicnily gcncral io solicii inicrcsi among oicniial candidaics. TIc naiurc of iIc jol, scoc, auiIoriiy,
and rcsonsililiiics form iIc corc of iIc jol dcscriiion. Indicaiions of rcfcrrcd cducaiional laclground
as wcll as salary rangc musi also lc includcd. In iimcs of IigI uncmloymcni, onc can always ccci
scvcral dozcn alicaiions for any onc ooriuniiy for cmloymcni. TIis lcads io iIc nci iasl of siaff
sclcciion.
StaII SeIectIon
TIc roccss of siaff sclcciion involvcs cvaluaiing candidaics iIrougI alicaiion forms, curriculum viiac,
and inicrvicws and cIoosing iIc lcsi candidaic for iIc sccific jol rcsonsililiiy. Onc can cvcn Iavc a lisi
of criicria and a scorc sIcci for cacI individual. Evcn iIcn, succcssful Iiring is oficn a vcry iniuiiivc aci
and involvcs somc dcgrcc of risl.
As a mcans of giving somc siruciurc and dcsign io iIc siaffing roccss, iIc following guidclincs arc uscful
(darl, 1973}. EacI jol inicrvicw sIould lc cIaracicrizcd ly.
1. A clcar dcfiniiion of iIc urosc of iIc inicrvicw
2. TIc rcscncc of a siruciurc or gcncral lan
3. TIc usc of iIc inicraciion as a lcarning ccricncc in a lcasani and siimulaiing aimosIcrc
4. TIc crcaiion and mainicnancc of raori lciwccn iIc inicrvicwcr and inicrvicwcc
5. TIc csiallisImcni of muiual confidcncc
6. Fcscci for iIc inicrvicwcc's inicrcsi and individualiiy ly iIc inicrvicwcr
7. An cffori io ui iIc inicrvicwcc ai casc
8. TIc csiallisImcni and mainicnancc of good communicaiion

9. TIc willingncss io ircai wIai is lcing said in rocr crscciivc

10. TIc jusi ircaimcni of cacI inicrvicwcc
StaII OrIentatIon
TIis is iIc roccss of formally iniroducing iIc sclccicd individual io iIc ariicular unii, io collcagucs, and
io iIc organizaiion. TIc sclccicd crson sIould lc awarc of iIc mission and oljcciivcs of iIc unii, iIc
naiurc of rcsonsililiiics and lcvcl of auiIoriiy, iIc dcgrcc of accounialiliiy, and iIc sysicms and
roccdurcs followcd io accomlisI iIc iasls associaicd wiiI iIc jol. A moiivaicd individual will simly
asl for sucI iIings as crsonncl manuals, adminisiraiivc roccdurcs Iandlools, and aims and
oljcciivcs siaicmcnis. SucI oricniaiion iools sIould lc availallc.
DIrectIng
Ai onc iimc iIcrc was a managcmcni cmIasis on "dircciing" in iIc dircciorial (auiocraiic} scnsc, lui in
rcccni iimcs, iIc concci of dircciing Ias lccomc morc congrucni wiiI lcading iIan wiiI usIing. TIus
ioday, dircciing is morc rclaicd io lcading and lcadcrsIi siylcs. LcadcrsIi in iIis conici mcans iIc
roccss wIcrcly a worl cnvironmcni is crcaicd in wIicI colc can do iIcir lcsi worl and fccl a
roriciary inicrcsi in roducing a qualiiy roduci or scrvicc.
McGregor (1960} rooscd iIai managcrs migIi assumc iIai cmloyccs arc moiivaicd in onc of iwo
ways. His dicIoiomy was lalcllcd iIcory X and iIcory Y. TIcory X rclaics io iradiiional managcmcni
wIcrcly managcrs assumc iIai iIcy musi conirol, cocrcc, and iIrcaicn in ordcr io moiivaic cmloyccs.
TIcory Y, iIc oosiic of iIcory X, suggcsis iIai cmloyccs wani io do cIallcnging worl, iIai iIcy arc
inicrcsicd in accciing rcsonsililiiy, and iIai iIcy arc lasically crcaiivc and wani io lc involvcd in
olicy dcvclomcni and oljcciivc sciiing. Today, iIcorics X and Y don'i rcally sound vcry rcvoluiionary;
iIc rollcm is iIai managcmcni siylcs and cmloycc moiivaiion do noi fii casily inio iwo iIcorciical
lalcls. As a rcsuli, addiiional iIcorciical lalcls (c.g., iIcory Z} arc lcing dcvclocd.
CoordInatIng
TIis imoriani siagc consisis of inicrrclaiing iIc various aris of iIc worl. Ii involvcs coordinaiing iIc
various jol rolcs and rcsonsililiiics of yoursclf and oiIcr siaff, of your unii and oiIcr uniis wiiIin iIc
samc organizaiion, and of your unii wiiI iIc lroadcr communiiy.
TIcrc arc iwo forms of coordinaiion. (1} vcriical rcoriing io your sucrvisor(s} and io your siaff, and (2}
Iorizonial rcoriing io your collcagucs and your managcmcni icam. Aduli and cicnsion cducaiors arc
usually involvcd in vcry comlc organizaiions sucI as govcrnmcnis, collcgcs and univcrsiiics, and
loards of cducaiion. Dccausc of iIc sizc of iIc organizaiion, iIc incrcasing dcmands for ullic
accounialiliiy, iIc many govcrnmcni rcgulaiions and olicics, iIc incrcasing comciiiion among
rovidcrs of aduli cducaiion ooriuniiics, and iIc cIangcs in iccInology, ii is csscniial iIai iIc
coordInatIng roIe be gIven top prIorIty.
How, tben, can eIIectIve coordInatIon be accompIIsbed?
Coordinaiion nccds rofcssional, comcicni lcadcrsIi, a dcmocraiic siylc iIai lcads io irusi, ocn
communicaiion, and casc of informaiion flow.
Coordinaiion nccds a consiani dcfiniiion and communicaiion of mission and oljcciivcs iIai arc
undcrsiood ly all managcrs.
Coordinaiion, io lc cffcciivc, musi Iavc ocn, iwo-way cIanncls of communicaiion.

Coordinaiion involvcs a sIaring aimosIcrc as wcll as commonly agrccd on dircciion. Dccausc cffcciivc
coordinaiion rcquircs coocraiion and communicaiion, iIc mcciing iccIniquc is siill iIc mosi cffcciivc
formai for assuring iIc inicrrclaiionsIis among iIc various jol rcsonsililiiics.
In rcccni ycars, formal sysicms of communiiy coordinaiion of aduli and cicnsion cducaiion aciiviiics
Iavc lccn dcvclocd. SucI councils of coniinuing cducaiion rovidc morc iIan jusi a nciworl of worlcrs
lui in faci lcad io discussions of communiiy nccds, agcncy rioriiics, and an agrccmcni as io wIo is
going io lool aficr wIai. SucI voluniary coordinaiion docs noi climinaic comciiiion; ii focuscs on iIc
muliiway flow of informaiion.
ReportIng
TIis funciion, closcly rclaicd io iIc coordinaiing funciion, consisis of lccing iIosc io wIom you arc
rcsonsillc informcd as io wIai is going on. Ii is csscniial iIai comcicni managcrs lcc iIc informaiion
flowing, csccially in iIis agc wIcn iIcrc is so mucI informaiion lcing iransmiiicd in so many forms. TIc
rcoriing funciion is morc iIan rcaring an annual rcori, quoiing siaiisiics, and informing your siaff of
currcni dcvclomcnis. TIc rcoriing funciion is almosi an cvaluaiion funciion sincc ii comarcs Iow you
arc doing wiiI wIai you sci oui io do. Ii rcvicws your oljcciivcs and dcicrmincs io wIai cicni you arc
mcciing your oljcciivcs. Ii consisis of morc iIan coursc numlcrs or annual siaiisiics, lui rclaics
rogrammc dircciion, olicy cIangcs, rcfincmcni in oljcciivcs, and cIangcs in siruciurcs and rioriiics. Ii
also uscs iIc vcriical and Iorizonial flows of informaiion as rcscnicd rcviously.
Onc of iIc lcy clcmcnis of iIc rcoriing funciion is iIc annual rcori. SucI a rcori givcs you iIc
ooriuniiy io summarizc rogrammcs, rojccis, and aciiviiics and io rovidc siaiisiics as wcll. SucI a
rcori can lc uscd as a ullic informaiion documcni ly Iaving ii disiriluicd io oiIcr aduli cducaiion
agcncics in iIc communiiy, io your scnior lcvcls of managcmcni, io your own managcrs, io your
collcagucs, and io iIc rcss. In addiiion, ii will rovc io lc a valuallc documcni io saiisfy iIc rcqucsis
you rcccivc asling aloui your rogrammc aciiviiics.
Budget management, iIcn, consisis of iIrcc aris. (1} ludgci dcicrminaiion - allocaiing rcvcnuc
according io rioriiics and ly linc iicms; (2} ludgci accounialiliiy - Iow wcll iIc aniiciaicd ludgci
maicIcs rcaliiy; and (3} using a +, 0 - noiaiion in answcring iIc qucsiions and ly lacing iIc noiaiions in
iIc locs on iIc cIari. In iIis way, onc can gci a iciurc of iIc rcdominani iycs of managcmcni modcs
currcnily lcing uscd. WIilc iIis may lc uscful in dcscriling wIai is, ii could lc cvcn morc uscful in
dcscriling wIai could lc. Ii is also uscful in roviding somc clucs as io ossillc arcas of rolc conflici - iIc
scIolarly rcscarcI modcl would lilcly collidc wiiI iIc comcicni raciiiioncr modcl (Waldron, 1994a}.
Siruciurc is iIc lasis for many modcrn lusincss organizaiions lccausc wc livc in a siruciurcd sociciy,
aliIougI iIc concci of siruciural rigidiiy and IicrarcIy is now lcing cIallcngcd ly a morc cducaicd,
crcaiivc, and inirinsically moiivaicd worlforcc. TIc siruciural aroacI sIows graIically iIai iIc
organizaiion Ias a disiinci Iysical sIac or form rovidcd ly an inicrnal form. A comcicni managcr in
iIis sysicm is allc io solvc rollcms, io figurc oui wIai nccds io lc donc, and iIcn cnlisi wIaicvcr
suori is nccdcd io gci ii donc. TIis aroacI is favourcd ly iradiiional, IicrarcIical, jol-sccific,
uncrcaiivc organizaiions.
A morc organic managcmcni mciIod is lascd on aradigms. A aradigm rcfcrs io a mciIod of
aroacIing a rollcm or siiuaiion and iIc linds of assumiions, valucs, and aiiiiudcs associaicd wiiI
iIinling aloui iIc siiuaiion (Oiiaway & Tcrjcson, 1986}. Ii connoics a aiicrn or siruciurc iIai is
dynamic, cIangcallc, and rcsonsivc io iIc cnvironmcni (Waldron, 1994}. TIc mosi dramaiic illusiraiion
of a aradigm sIifi was iIc sIifi from iIc Piolcmaic iIcory, wIicI saw iIc cariI as iIc ccnirc of iIc
univcrsc, io iIc Cocrnican iIcory, wIicI saw iIc sun as iIc ccnirc of iIc univcrsc. A aradigm sIifi
rcsulis in a ioial rcsiruciuring in iIc ways wc iIinl aloui a siiuaiion and iIc linds of assumiions wc
malc aloui formcr olscrvaiions. Covcy (1992} scals of aradigm sIifis. iIings, colc, and siruciurc
can and do cIangc - noiIing is consiani. Hc sIows Iow almosi cvcry significani lrcaliIrougI is firsi a

lrcal wiiI iradiiion, wiiI old aiicrns, wiiI old ways of iIinling, and wiiI old aradigms. Scngc (1990}
siaics iIai a "sIifi of mind" is ncccssary lccausc "iIc unIcaliIincss of our world ioday is in dircci
rooriion io our inaliliiy io scc ii as a wIolc." In icrms of managcmcni, cicnsion managcrs sIould vicw
colc noi as "Icllcss rcaciors, lui as aciivc ariicianis in sIaing iIcir rcaliiy - from rcaciing io iIc
rcscni io crcaiing iIc fuiurc" (. 68-69}.
TIc usc of modcls is common raciicc in managcmcni iIinling. Modcls arc uscful lccausc various
asccis of iIc siruciurcs can lc vicwcd from diffcrcni osiiions iIai can iIcn lcad io ncw crscciivcs.
TIc goal of modclling is io acIicvc an accuraic yci rclaiivcly simlc rcrcscniaiion of a sysicm, comlc
cniiiy, or rcaliiy usually on a smallcr scalc. Ii imlics loiI siruciurc and cIangc. An imoriani ascci of
modcl luilding is collcciing and rcaring daia. Informaiion gaincd from iIc daia is iIc foundaiion of iIc
modcl.
TIc modcl sIould rcflcci iIc major asccis of iIc rollcm as simly as ossillc. Oficn, iIis rcquircs
iradcoffs lccausc simliciiy and accuracy rarcly go Iand in Iand. TIc consianis, if any, wiiIin iIc modcl
sIould lc lnown wiiI a IigI dcgrcc of rccision. Onc misialc iIai inccricnccd modcl luildcrs oficn
malc is failing io ialc a lroad crscciivc of iIc rollcm. TIcy do noi ialc inio accouni oiIcr
dimcnsions of rcaliiy iIai a soluiion may Iavc an imaci on. To accomlisI iIis lroad crscciivc, iIc
cicnsion managcr sIould adoi a sysicms aroacI io modcl luilding and sIould focus noi only on iIc
immcdiaic rollcm, lui also on inicrrclaiionsIis iIai cisi wiiIin and ouisidc iIc organizaiion and Iow
iIcsc rclaiionsIis will lc affccicd (Sicvcnson, 1989}. Onc modcl is usually dominani. To caminc wIicI
modcl fiis iIc nccds of a ariicular cicnsion managcr's rogrammc and Iis or Icr criicria, onc can
crcaic a mairi similar io Figurc 2. Dy answcring qucsiions similar io iIosc rcscnicd in Figurc 3, onc
can dcvclo a good undcrsianding of iIc sccific modcl wIicI would aly io cicnsion rogrammcs.