Preface xix
About the Authors xxxi
Part 1 Introduction to Modern Management 1
1 Introducing Modern Management: Concepts and Skills 1
Management Skill 1
Challenge Case: An IBM Success Story: Rodney Adkins 2
The Modern Management Challenge 2
A Manager’s Task 3
The Role of Management 4
Defining Management 4
The Management Process: Management Functions 5
Management Process and Organizational Resources 6
Practical Challenge: Attaining Goals: Michael Hoffman Achieves User Satisfaction at New York Passport Agency 7
Management and Organizational Resources 7
The Universality of Management 9
Management Skill: The Key to Management Success 9
Defining Management Skill 9
Management Skill: A Classic View 10
Management Skill: A Contemporary View 10
Steps for Success: Developing Human Skills 11
Management Skill: A Focus of This Book 11
Management Careers 13
A Definition of Career 14
Career Stages, Life Stages, and Performance 14
Promoting Your Own Career 15
Tips for Managing around the Globe: Making the Most of International Experience 15
Special Career Issues 16
Challenge Case Summary 18
Class Preparation and Personal Study 19
Management Skill Exercises 20
Part 2 Modern Management Challenges 24
2 Managers, Society, and Sustainability 24
Social Responsibility Skill 24
Challenge Case: IKEA Builds on Its Commitment to the Environment 25
The Social Responsibility Challenge 25
Fundamentals of Social Responsibility 26
Areas of Social Responsibility 26
Varying Opinions on Social Responsibility 26
Conclusions about the Performance of Social Responsibility Activities by Business 27
Social Responsiveness 29
Determining Whether a Social Responsibility Exists 29
Social Responsiveness and Decision Making 30
Tips for Managing around the Globe: Are Clothing Retailers Responsible for Bangladeshi Garment Workers? 30
Approaches to Meeting Social Responsibilities 31
The Social Audit Challenge 32
The Philanthropy Challenge 33
The Sustainable Organization Challenge 34
Defining Sustainability 34
Defining a Sustainable Organization 34
Why Sustainability? 35
Steps for Achieving Sustainability 36
Practical Challenge: Achieving Sustainability: General Mills 36
Managers and Ethics 38
A Definition of Ethics 38
Why Ethics Is a Vital Part of Management Practices 38
A Code of Ethics 39
Creating an Ethical Workplace 40
Steps for Success: Creating an Ethical Work Environment 41
Following the Law: Sarbanes–Oxley Reform Standards 42
Challenge Case Summary 43
Class Preparation and Personal Study 44
Management Skill Exercises 45
3 Management and Diversity 51
Diversity Skill 51
Challenge Case: Diverse Employees Contribute to GE Lighting’s Bright Future 52
The Diversity Challenge 53
Defining Diversity 53
The Social Implications of Diversity 53
Advantages of Diversity in Organizations 53
Gaining and Keeping Market Share 54
Cost Savings 54
Increased Productivity and Innovation 55
Better Quality Management 55
Challenges That Managers Face In Working With Diverse Populations 56
Changing Demographics 56
Multi-Generation Workforce 57
Ethnocentrism and Other Negative Dynamics 57
Practical Challenge: Neutralizing Stereotypes: BAE Systems Battles Stereotyping with Awareness 58
Negative Dynamics and Specific Groups 59
Strategies For Promoting Diversity In Organizations 61
Promoting Diversity through Hudson Institute Strategies 62
Promoting Diversity through Equal Employment and Affirmative Action 62
Promoting Diversity through Organizational Commitment 63
Promoting Diversity through Pluralism 65
Tips for Managing around the Globe: Promoting Diversity Globally: The Sodexo Example 65 65
How Managers Promote Diversity 67
Planning 67
Organizing 67
Influencing 67
Steps for Success: Motivating across the Generations 68
Controlling 68
Management Development and Diversity Training 69
Challenge Case Summary 71
Class Preparation and Personal Study 72
Management Skill Exercises 73
4 Managing in the Global Arena 78
Global Management Skill 78
Challenge Case: McDonald’s Is Lovin’ Global Growth 79
The Global Management Challenge 79
Fundamentals of International Management 80
Categorizing Organizations By Level of International Involvement 81
Domestic Organizations 82
International Organizations 82
Multinational Organizations: The Multinational Corporation 82
Multinational Corporations 82
Complexities of Managing the Multinational Corporation 83
Practical Challenge: Managing Risk: Lenovo’s East-to-West Strategy 85
Risk and the Multinational Corporation 85
The Workforce of Multinational Corporations 85
Types of Organization Members Found in Multinational Corporations 86
Workforce Adjustments 86
Adjusting to a New Culture 86
Repatriation 86
Management Functions and Multinational Corporations 87
Planning in Multinational Corporations 87
Organizing Multinational Corporations 90
Influencing People in Multinational Corporations 92
Steps for Success: Leading in Other Cultures 94
Controlling Multinational Corporations 94
Transnational Organizations 95
International Management: Special Issues 95
Maintaining Ethics in International Management 95
Tips for Managing around the Globe: Oxfam’s Push for Ethical Practices 96
Preparing Expatriates for Foreign Assignments 97
Challenge Case Summary 97
Class Preparation and Personal Study 98
Management Skill Exercises 99
Part 3 Planning 105
5 Plans and Planning Tools 105
Planning Skill 105
Challenge Case: Wal-Mart Plans to Have What You Want 106
The Planning Challenge 106
General Characteristics of Planning 107
Defining Planning 107
Purposes of Planning 107
Planning: Advantages and Potential Disadvantages 107
Primacy of Planning 108
Types of Plans 108
Standing Plans: Policies, Procedures, and Rules 108
Steps for Success: Writing Effective Policies and Procedures 109
Single-Use Plans: Programs and Budgets 110
Steps in the Planning Process 111
Organizational Objectives: Planning’s Foundation 112
Definition of Organizational Objectives 112
Areas for Organizational Objectives 114
Working with Organizational Objectives 114
Guidelines for Establishing Quality Objectives 115
Management by Objectives (MBO) 115
Factors Necessary for a Successful MBO Program 116
MBO Programs: Advantages and Disadvantages 116
Planning Tools 117
Forecasting 117
Tips for Managing around the Globe: Forecasting Supply of Raw Materials: Mars Inc. 118
Scheduling 121
Practical Challenge: Meeting Schedules: Clark/McCarthy Joint Venture Builds Navy Hospital Ahead of Schedule 122
Why Plans Fail 123
Challenge Case Summary 124
Class Preparation and Personal Study 125
Management Skill Exercises 126
6 Making Decisions 131
Decision-Making Skill 131
Challenge Case: Whole Foods Decides to Open in Detroit 132
The Decision-Making Challenge 132
Fundamentals of Decisions 133
Definition of a Decision 133
Types of Decisions 133
The Responsibility for Making Organizational Decisions 134
Tips for Managing around the Globe: Shaw Industries Paves the Way for Good Decisions 134
Elements of the Decision Situation 135
The Rational Decision-Making Process 136
Identifying an Existing Problem 137
Listing Alternative Solutions 137
Selecting the Most Beneficial Alternative 138
Implementing the Chosen Alternative 139
Gathering Problem-Related Feedback 139
Bounded Rationality 139
Practical Challenge: Implementing Decisions: K’Nex Brands Builds on Its Core Values 139
Decision Making and Intuition 140
Decision-Making Heuristics and Biases 140
Decision-Making Conditions: Risk and Uncertainty 140
Decision-Making Tools 141
Probability Theory 141
Decision Trees 142
Group Decision Making 143
Advantages and Disadvantages of Using Groupsto Make Decisions 143
Steps for Success: Facilitating Group Decisions 144
Processes for Making Group Decisions 144
Evaluating Group Decision-Making Processes 145
Challenge Case Summary 146
Class Preparation and Personal Study 147
Management Skill Exercises 148
7 Strategic Planning: Strategies, Tactics, and Competitive Dynamics 152
Strategic Planning Skill 152
Challenge Case: Facebook Positions Itself to Stay Relevant 153
The Strategic Planning Challenge 153
Strategic Planning and Strategy 154
Strategic Management Process 155
Environmental Analysis 155
The General Environment 155
The Industry Environment 158
The Internal Environment 159
Establishing Organizational Direction 159
Determining Organizational Mission 159
Developing a Mission Statement 160
The Importance of an Organizational Mission 160
The Relationship Between Mission and Objectives 160
Strategy Formulation: Tools 160
Critical Question Analysis 160
Steps for Success: Ask the Right Questions 161
SWOT Analysis 161
Business Portfolio Analysis 161
Strategy Formulation: Types 164
Sample Organizational Strategies 164
Strategy Implementation 165
Tips for Managing around the Globe: Be Flexible: Tata Motors 165
Strategic Control 166
Tactical Planning 166
Comparing and Coordinating Strategic and Tactical Planning 166
Competitive Dynamics 167
Practical Challenge: Competitive Dynamics for Retailers: Stores Take on Amazon 167
Challenge Case Summary 169
Class Preparation and Personal Study 170
Management Skill Exercises 171
Part 4 Organizing 175
8 Fundamentals of Organizing 175
Organizing Skill 175
Challenge Case: Microsoft Tries to Program Unity with Its New Structure 176
The Organizing Challenge 176
Definitions of Organizing and Organizing Skill 177
The Importance of Organizing 177
The Organizing Process 178
Classical Organizing Theory 178
Weber’s Bureaucratic Model 179
Division of Labor 179
Advantages and Disadvantages of Division of Labor 180
Division of Labor and Coordination 180
Follett’s Guidelines on Coordination 180
Practical Challenge: Coordination: How the MBTA Moved Forward with Security 181
Structure 181
Informal Organizational Structures 181
Vertical Dimensioning 182
Horizontal Dimensioning 184
Types of Departmentalization 184
Tips for Managing around the Globe: Reorganizing for Mature Businesses: Yum Brands 184
Departments Based on Function 185
Departments Based on Product or Service 186
Departments Based on Geography 186
Departments Based on Customer 187
Departments By Matrix 188
Steps for Success: Managing in a Matrix Structure 189
Challenge Case Summary 190
Class Preparation and Personal Study 192
Management Skill Exercises 192
9 Responsibility, Authority, and Delegation 197
Responsibility and Delegation Skill 197
Challenge Case: Toyota to Delegate Authority 198
The Responsibility and Delegation Challenge 198
Responsibility and Job Descriptions 199
Steps for Success: Writing a Well-Crafted Job Description 199
Dividing Job Activities 200
The Functional Similarity Method 200
Functional Similarity and Responsibility 200
Clarifying Job Activities of Managers 201
Management Responsibility Guide 201
Authority 202
Authority on the Job 202
Acceptance of Authority 203
Types of Authority 203
Accountability 205
Delegation 206
Practical Challenge: Accountability: How Extended Stay America Eased the Sting of Accountability 206
Steps in the Delegation Process 207
Obstacles to the Delegation Process 207
Eliminating Obstacles to the Delegation Process 208
Centralization and Decentralization 208
Decentralizing an Organization: A Contingency Viewpoint 209
Tips for Managing around the Globe: Decentralizing for Diverse Markets: The Four Seasons Example 209
Decentralization at Massey-Ferguson: A Classic Example from the World of Management 210
Challenge Case Summary 211
Class Preparation and Personal Study 213
Management Skill Exercises 213
10 Human Resource Management 218
Human Resource Management Skill 218
Challenge Case: Cisco Recruits the Best Minds in . . . Cisco 219
The Human Resource Management Challenge 219
Defining Appropriate Human Resources 220
Recruitment 220
Knowing the Job 220
Knowing Sources of Human Resources 221
Sources Outside the Organization 224
Tips for Managing around the Globe: European Companies Need Women on Their Boards 225
Knowing the Law 225
Selection 226
Testing 226
Assessment Centers 227
Training 227
Determining Training Needs 228
Designing the Training Program 229
Administering the Training Program 229
Steps for Success: Preparing for Computer-Based Training 230
Evaluating the Training Program 230
Performance Appraisal 231
Why Use Performance Appraisals? 231
Practical Challenge: Appraising Executives’ Performance: For Citigroup Executives, It Is All about Numbers 232
Handling Performance Appraisals 232
Potential Weaknesses of Performance Appraisals 232
Challenge Case Summary 233
Class Preparation and Personal Study 235
Management Skill Exercises 235
11 Changing Organizations: Stress, Conflict, and Virtuality 240
Organizational Change Skill 240
Challenge Case: How Huntington Hospital Introduced Electronic Health Records 241
The Organizational Change Challenge 242
Fundamentals of Changing an Organization 242
Defining Changing an Organization 242
Change Versus Stability 243
Factors to Consider When Changing an Organization 243
The Change Agent 243
Determining What Should Be Changed 244
The Kind of Change to Make 245
Individuals Affected by the Change 247
Tips for Managing around the Globe: Try Out Change in One Country First: Avon’s Experience 249
Evaluation of the Change 249
Change and Stress 249
Defining Stress 249
The Importance of Studying Stress 250
Managing Stress in Organizations 250
Steps for Success: Managing Stress 251
Change and Conflict 253
Defining Conflict 253
Strategies for Settling Conflict 253
Practical Challenge: Managing Conflict: Southwest Airlines Embraces Positive Conflict 253
Virtuality 255
Defining a Virtual Organization 255
Degrees of Virtuality 255
The Virtual Office 256
Challenge Case Summary 257
Class Preparation and Personal Study 259
Management Skill Exercises 260
Part 5 Influencing 265
12 Influencing and Communication 265
Communication Skill 265
Challenge Case: How Evernote’s Phil Libin Keeps Communication Flowing 266
The Communication Challenge 266
Fundamentals of Influencing 267
Defining Influencing 267
The Influencing Subsystem 267
Emotional Intelligence 269
Practical Challenge: Recognizing Influencers: How Cigna Is Tapping Influential Employees 269
Communication 270
Interpersonal Communication 271
Tips for Managing around the Globe: Overcoming Cultural Barriers: The Lenovo Example 273
Steps for Success: Communicating with Eye Contact 277
Interpersonal Communication in Organizations 277
Formal Organizational Communication 278
Informal Organizational Communication 279
Encouraging Organizational Communication 281
Challenge Case Summary 282
Class Preparation and Personal Study 283
Management Skill Exercises 284
13 Leadership 289
Leadership Skill 289
Challenge Case: Iwata Faces Many Different Issues at Nintendo 290
The Leadership Challenge 290
Defining Leadership 291
Leader Versus Manager 291
Early Approaches to Leadership 292
The Trait Approach to Leadership 292
Behavioral Approaches to Leadership 292
More Recent Approaches to Leadership 294
Tips for Managing around the Globe: Leadership Perceptions Vary by Culture, Say Researchers 294
The Life Cycle Theory of Leadership 295
Fiedler’s Contingency Theory 296
The Path-Goal Theory of Leadership 298
A Special Situation: How Leaders Make Decisions 299
The Tannenbaum and Schmidt Leadership Continuum 299
The Vroom-Yetton-Jago Model 302
Leaders Changing Organizations 303
The Tasks of Transformational Leaders 304
Leaders Coaching Others 304
Steps for Success: Becoming a Transformational Leader 304
Coaching Behavior 305
Leadership: Emerging Concepts for Modern Times 306
Servant Leadership 306
Level 5 Leadership 307
Practical Challenge: Leading for Greatness: How Ursula Burns, Xerox CEO, Meets the Leadership Challenge 308
Authentic Leadership 308
Challenge Case Summary 310
Class Preparation and Personal Study 312
Management Skill Exercises 312
14 Motivation 318
Motivation Skill 318
Challenge Case: American Express Taps the Full Potential of Its Employees 319
The Motivation Challenge 319
Defining Motivation 320
Process Theories of Motivation 320
The Needs-Goal Theory of Motivation 320
The Vroom Expectancy Theory of Motivation 321
Equity Theory of Motivation 322
The Porter-Lawler Theory of Motivation 323
Content Theories of Motivation: Human Needs 323
Maslow’s Hierarchy of Needs 324
Alderfer’s ERG Theory 324
Practical Challenge: Developing Rewards: Rewards That Motivate at Seco Tools 325
Argyris’s Maturity-Immaturity Continuum 325
McClelland’s Acquired Needs Theory 326
Importance of Motivating Organization Members 326
Strategies For Motivating Organization Members 327
Managerial Communication 327
Tips for Managing around the Globe: Communicating Rewards That Align with Values 328
Theory X-Theory Y 328
Behavior Modification 331
Likert’s Management Systems 332
Steps for Success: Making Motivation Work 333
Monetary Incentives 334
Nonmonetary Incentives 334
Challenge Case Summary 335
Class Preparation and Personal Study 336
Management Skill Exercises 337
15 Groups and Teams 342
Team Skill 342
Challenge Case: Better Teamwork Makes Numerica Credit Union a Winner 343
The Team Challenge 344
Groups 344
Kinds of Groups in Organizations 344
Formal Groups 344
Steps for Success: Leading Group Development 349
Informal Groups 349
Managing Work Groups 350
Determining Group Existence 350
Understanding the Evolution of Informal Groups 352
Teams 352
Groups Versus Teams 352
Types of Teams in Organizations 353
Practical Challenge: Solving Problems as a Team: In the Huddle with Lawrence Hospital Center Teams 353
Stages of Team Development 355
Forming 355
Storming 355
Norming 355
Performing 355
Adjourning 356
Team Effectiveness 356
Trust and Effective Teams 357
Tips for Managing around the Globe: Establishing Trust in International Teams 358
Challenge Case Summary 359
Class Preparation and Personal Study 360
Management Skill Exercises 361
16 Managing Organization Culture 367
Organization Culture Skill 367
Challenge Case: Zappos Doesn’t Sell Shoes—It “Delivers WOW” 368
The Organization Culture Challenge 368
Fundamentals of Organization Culture 369
Defining Organization Culture 369
The Importance of Organization Culture 369
Tips for Managing around the Globe: Marriott International’s Code of Conduct 370
Functions of Organization Culture 370
Types of Organization Culture 371
Building a High-Performance Organization Culture 373
Practical Challenge: Building a High-Performance Culture: Butler Snow’s Team-Oriented Culture Supports High Performance 375
Keeping Organization Culture Alive and Well 375
Establishing a Vision of Organization Culture 376
Building and Maintaining Organization Culture Through Artifacts 378
Steps for Success: Telling a Company’s Stories 379
Integrating New Employees into the Organization Culture 380
Maintaining the Health of Organization Culture 382
Challenge Case Summary 383
Class Preparation and Personal Study 384
Management Skill Exercises 385
Part 6 Controlling 390
17 Controlling, Information, and Technology 390
Controlling Skill 390
Challenge Case: Sperry Van Ness: Harnessing Technology for Business Success 391
The Controlling Challenge 391
The Fundamentals of Controlling 392
Defining Control 392
The Controlling Subsystem 392
The Controlling Process 392
Measuring Performance 392
Comparing Measured Performance to Standards 393
Taking Corrective Action 395
Power and Control 396
A Definition of Power 396
Total Power of a Manager 397
Steps for Increasing Total Power 397
Tips for Managing around the Globe: Exercising Power across Cultures 397
Making Controlling Successful 398
Essentials of Information 399
Factors Influencing the Value of Information 399
Steps for Success: Getting a Handle of “Big Data” 401
Evaluating Information 402
The Information System (IS) 403
Describing the IS 403
Practical Challenge: Using Data from Social Media: Twitter Feeds Businesses’ Needs 404
Managing Information Systems 405
Challenge Case Summary 408
Class Preparation and Personal Study 409
Management Skill Exercises 410
18 Production and Control 415
Production Skill 415
Challenge Case: Better Production Planning Saves Money for 3M 416
The Production Challenge 416
Production and Productivity 417
Defining Production 417
Productivity 417
Quality and Productivity 418
Focus on Continual Improvement 418
Focus on Quality and Integrated Operations 418
Practical Challenge: Continual Improvement: At Wisconsin Hospitals, Costs Fall as Quality Rises 419
Automation 420
Strategies, Systems, and Processes 421
Operations Management 422
Defining Operations Management 422
Operations Management Considerations 422
Tips for Managing around the Globe: Choosing a Factory Location: Volkswagon Picks North America 424
Operations Control 427
Just-in-Time Inventory Control 427
Maintenance Control 428
Cost Control 429
Budgetary Control 429
Steps for Success: Controlling with a Budget 430
Ratio Analysis 431
Materials Control 432
Operations Control Tools 432
Using Control Tools to Control Organizations 432
Inspection 433
Management by Exception 433
Management by Objectives 434
Break-Even Analysis 434
Other Broad Operations Control Tools 436
Challenge Case Summary 437
Class Preparation and Personal Study 439
Management Skill Exercises 440
Appendix 1 Managing: History and Current Thinking 444
Comprehensive Management Skill 444
Challenge Case: How Management Innovation Keeps Ford Moving Ahead 445
The Comprehensive Management Skill Challenge 445
The Classical Approach 446
Lower-Level Management Analysis 447
Practical Challenge: Improving Productivity: Tracking Sensors Take Work Measurement to a New Level 448
Comprehensive Analysis of Management 450
Limitations of the Classical Approach 451
The Behavioral Approach 451
The Hawthorne Studies 452
Recognizing the Human Variable 452
Steps for Success: Understanding Employees 453
The Human Relations Movement 453
The Management Science Approach 454
The Beginning of the Management Science Approach 454
Management Science Today 454
Characteristics of Management Science Applications 455
The Contingency Approach 455
The System Approach 456
Types of Systems 456
Systems and “Wholeness” 456
The Management System 456
Information for Management System Analysis 457
Learning Organization: A New Approach? 458
Tips for Managing around the Globe: IBM’s “Crowded” Learning Environment 459
Challenge Case Summary 459
Class Preparation and Personal Study 460
Management Skill Exercises 461
Appendix 2 Management and Entrepreneurship: Handling Start-Ups and New Ventures 466
Entrepreneurship Skill 466
Challenge Case: Patagonia’s Idealistic Entrepreneur 467
The Entrepreneurship Challenge 467
Fundamentals of Entrepreneurship 468
Types of Opportunities 468
Opportunity Identification 469
Opportunity Evaluation 470
Steps for Success: Testing Business Ideas 471
Opportunity Exploitation 472
Financing Exploitation 473
Corporate Entrepreneurship 474
Practical Challenge: Raising Funds: Bohemian Guitars Tests the Waters of “Crowdfunding” 474
Social Entrepreneurship 475
How Do Commercial and Social Entrepreneurship Differ? 476
Tips for Managing around the Globe: Taking a Global View of Opportunities: One Earth Designs 476
Success Factors in Social Entrepreneurship 477
Challenge Case Summary 477
Class Preparation and Personal Study 478
Management Skill Exercises 479
Appendix 3 Encouraging Creativity and Innovation 484
Creativity and Innovation Skill 484
Challenge Case: MidwayUSA Hits the Target with Innovation Aimed at Quality 485
The Creativity and Innovation Challenge 486
Creativity 486
Defining Creativity 486
Creativity in Organizations 486
Creativity in Individuals 486
Practical Challenge: Enabling Creativity: UN Development Program Backs Creative Responses to Crises 487
Increasing Creativity in Organizations 488
Innovation and Creativity 491
Defining Innovation 491
Linking Innovation and Creativity 492
The Innovation Process 492
Steps for Success: Inviting Inventions at a Hackathon 493
Catalyst For Creativity and Innovation: Total Quality Management 495
Essentials of Total Quality Management 495
Tips for Managing around the Globe: Michelin’s Quality Advantage 496
The Quality Improvement Process 497
Creative Ideas Based on TQM Expertise 500
Challenge Case Summary 502
Class Preparation and Personal Study 503
Management Skill Exercises 504
Glossary 509
Author Index 521
Subject Index 528
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