T

Tactical asset allocation In finance, enhancing the portfolio returns by altering the asset composition and mix.

Taguchi, Genichi (1924–2012) Japanese management consultant who developed the concept of quality engineering through his TAGUCHI METHOD and author of Introduction to Quality Engineering. He is credited with such concepts as robust design and Taguchi loss function, designed to improve engineering quality and productivity. He introduced three stages in production: system design, parameter stage (in which the product is defined under several parameters), and tolerance design.

Taguchi method Devised by management consultant GENICHI TAGUCHI, a method of testing the design of a new product under the most adverse circumstances, through a battery of permutations and combinations and statistical analysis.

Take-off stage Period of development marked by rapid development, stage 3 in economist W. W. ROSTOW’S stages of growth. It follows the traditional society stage and preconditions for take-off stage and is followed by the drive to maturity stage and then the age of high mass consumption stage.

Takeover bid Offer to the shareholders of a company, over the heads of its management, to buy their shares at a specified price and thus gain control. Such a bid may be with the blessing of management or it may be a HOSTILE BID. In the case of an unconditional bid, the bidder pays the offered price irrespective of the number of shares acquired, while in the case of a conditional bid, the offer is good only if sufficient shares are acquired to gain a controlling interest.

Tall organization Pyramid framework for management of an organization, with a relatively large number of intermediate levels. Compare FLAT ORGANIZATION.

Tannenbaum-Schmidt continuum Model of leadership that sees the role as a continuum stretching from autocratic to democratic. In any given situation, the impact of leadership will be judged by three criteria: (1) the leader’s self-confidence, charisma, and philosophy of management; (2) the complementary qualities of the followers or employees, such as experience, sense of responsibility, and responsiveness; and (3) the nature and complexity of the circumstances and problems addressed.

Target costing Method of costing products or services to reflect the price that customers are willing to pay and the price charged by competitors. The target cost must include a specified profit margin. It differs from the actual cost, which may be based on the cost of raw materials and production. Target costing was popularized by the Japanese, who used techniques such as JUST-IN-TIME, KAIZEN, TEAR DOWN, TOTAL QUALITY MANAGEMENT, VALUE ENGINEERING, ACTIVITY-BASED COSTING, and BENCHMARKING to achieve target costs.

Target marketing Marketing aimed at meeting the needs of a specific group of customers. See also NICHE MARKET.

Task Unit of work; one of the elements of a job.

Task analysis Disaggregation of the elements of a task to identify the skills required. It assesses what people, machines, or a combination thereof are needed and why.

Task culture Term coined by management consultant CHARLES HANDY to describe corporate behavior focused on the completion of tasks.

Task orientation Leadership style concerned with setting goals, structured tasks, and measured performance. It involves planning feedback from participants and concern with the quality of outcome.

Task roles People with discrete capabilities, assigned to problem solution and decision making, as initiator, opinion seeker, and summarizer.

Taskforce Group of people charged with the execution of a specific plan or program.

Tax haven Country with a low tax rate, used by wealthy investors and companies to relieve themselves from a high tax burden. Often requires residence for a given part of a year, citizenship, or corporate headquarters. Four of the most popular tax havens are the Bahamas, Cayman Islands, Monaco, and Liechtenstein.

Tax treaty Agreement between two countries for providing relief from double taxation, applied to income earned in both countries.

Tavistock method Approach to management and management studies initiated by the Tavistock Institute for Human Relations in London.

Taylor, F. W. (1856–1915) American engineer who invented Work study and pioneered scientific management, sometimes known as Taylorism. He emphasized TASK ANALYSIS and stressed the importance of good communications, recruitment, and training. Taylor was the author of Principles of Scientific Management (1911) and Shop Management (1903). He developed many management concepts, such as functional authority, which stated that all authority was based on knowledge and not position.

Teaching company Corporation in which each employee is expected to both learn and teach others.

Team Group of employees organized to accomplish a common purpose. There are six major types of teams: informal, traditional, problem solving, leadership, self-directed, and virtual.

Team building Relating to exercises or programs designed to construct group functions and create teams that are cohesive, united, and emotionally bonded.

Team management wheel Visual aid for the efficient coordination of teamwork and for TEAM BUILDING and training, devised by management consultants CHARLES MARGERISON and DICK MCCANN. It helps team members to choose the work they prefer to do

Team role Position on a team and the nature of the participation. There are 11 distinct roles played by members of a team: team worker, completer, shaper, monitor, evaluator, planner, resource person, investigator, coordinator, implementer, and specialist.

Tear down Method of comparing a company’s products and components with those of its competitors. Originally devised by General Motors, it was adapted by the Japanese, who expanded it to include eight different steps: (1) dynamic tear down, which reduces the number of assembly operations; (2) cost tear down, which reduces the cost of the components vis-à-vis those used by competitors; (3) material tear down, of materials used in surface treatments; (4) static tear down, by disassembling competing products; (5) process tear down, by comparing manufacturing processes for similar parts; (6) matrix tear down, by identifying the volume of each component used by a model per month; (7) unit-kilogram price tear down, which plots the value per kilo for all the products in the same group against their weight; and (8) group estimate tear down, which combines basic VALUE REENGINEERING and tear-down methods.

Teaser rate Low interest rate designed to attract new customers, available for only a short period.

Technical analysis Method used to forecast the direction of prices through the study of past market data, especially prices and volume.

Technocrat Technical expert alternating as a manager, who brings technical skills to management problem solving.

Technological change Improvement in the ratio of productivity and output to labor brought about by inventions, automation, and computerized methods of production.

Technological risk Chance that a business may be overtaken by technological advances, making certain of its products and services obsolete.

Technological unemployment Reduction in the labor force and loss of employment, brought about by automation and computerized production.

Technology assessment Collection of data on a firm’s utilization of currently available technology and potential use of technological breakthroughs.

Technology management Science that links engineering, science, and management to plan, develop, and implement technological capabilities that can shape the strategic and operational objectives of an organization.

Technology transfer Transfer of technological know-how, mostly through licensing, usually across borders and especially from industrially advanced countries to underdeveloped countries.

Telecommuting Nontraditional employment pattern in which employees work from home and communicate with employers via telephone and Internet.

Teleconference Discussion or meeting in which participants are geographically separated but are linked via telecommunication.

Telemarketing Direct sales of products or services via phone calls by trained representatives.

Tenor In finance, the period between issuance of a security and its maturity, or the period of a loan or contract.

Terms of trade Formula that measures the trading position of a country by dividing export prices by import prices. When the former is stronger, a country’s trading position is favorable.

Terotechnology Branch of technology dealing with the use of management, engineering, and financial skills in the operation of a factory.

Test marketing Pilot marketing attempt that assesses consumer reactions in a limited market and extrapolates the results to cover the broader market.

T-group Training group that uses informal roles to help participants enhance their interpersonal skills and relationships.

Theory Set of integrated ideas, conclusions, hypotheses, and concepts used to describe a phenomenon or investigate patterns, and whose validity has been tested in a scientific setting.

Theory E Orienting an organization to focus primarily on the creation of shareholder value, through the actions of its top managers.

Theory J Japanese approach to management developed by management professor William Ouchi.

Theory O Model of organizational change based on a corporate culture that includes human development, empowerment of employees, and organizational learning.

Theory of constraints Approach to production that focuses on potential bottlenecks, as well as the refinement of process and redesign of products to maximize output. The theory was developed by management guru ELIYAHU GOLDRATT to identify constraints that block success in any system and how to remove such constraints.

Theory of the firm Branch of management concerned with the nature of the corporation, rather than the nature of the market. It incorporates insights from psychology, sociology, and GAME THEORY, and focuses on reducing transaction costs. It asks the questions: (1) What is the rationale for a corporation as the most efficient agent for economic transactions? (2) Why do some firms change while others collapse? (3) What are the external and internal forces that shape a corporation? and (4) How does an organizational culture emerge in a corporation and what are its distinguishing hallmarks?

Theory of the horizontal fast track Principles developed by management guru CHARLES HANDY for developing company versatility by moving people from job to job to test and hone their capabilities.

Theory W Variation of THEORY X.

Theory X Concept of human motivation put forward by management professor DOUGLAS MCGREGOR, which states that human beings are inherently lazy, unmotivated, and irresponsible. They prefer being led and directed, rather than being autonomous, and the only time they are creative is when they find ways to circumvent the system. Their only motivators are money and coercion.

Theory Y Concept of human motivation put forward by management professor DOUGLAS MCGREGOR, which states that human beings are capable of genuine altruism and pursuit of excellence, and may be inspired by creativity and ingenuity given the right incentives. They are capable of being responsible and disciplined and enjoy recognition and encouragement.

Theory Z Alternative theory of human motivation borrowed from Japan, put forward by management professor William Ouchi. It proposed that employees seek better career prospects, more secure employment, greater participation in decision making, greater emphasis on team spirit and camaraderie, and greater mutual respect.

Therblig Reverse spelling of Gilbreth, after FRANK and LILLIAN GILBRETH, pioneers in motion study. It is a unit of measurement used in motion economics, one of 18 fundamental units of every operation, whose configuration is essential for the successful completion of a task.

Thin market Demand for a security, commodity, or currency with few transactions, where the spread between bid and offer is wide and where even small transactions have a large impact.

Think tank Research organization that assembles experts in a given field, with the goal of stimulating fresh thinking.

Third sector Nonprofit and charitable organizations, a group of businesses that constitute a powerful and influential voting bloc.

Third wave From futurist ALVIN TOFFLER’S description of society’s development as a series of waves. The first wave is agricultural, the second is industrial, and the third is postindustrial, or basically the INFORMATION AGE.

Third world Term used during the cold war to describe nonaligned countries (vs. Soviet or Western world), then extended to mean the underdeveloped countries in contrast to the industrialized countries of the West. It was a translation of the French term tiers monde, even extending back to references to the Third Estate, meaning the peasant class during the French Revolution. The term has been replaced by other descriptors, such as the SOUTH and three-fourths world. See also FOURTH WORLD.

360-degree evaluation Technique used in personnel management, in which opinions regarding an employee’s performance is obtained from superiors as well as peers.

Three-dimensional management Theory outlining a management style developed by management experts WILLIAM REDDIN, ROBERT BLAKE, and JANE MOUTON.

Three Ss Strategy, structure, and systems—three classes of decision making.

Tichy, Noel U.S. business guru known for his research on TRANSFORMATIONAL LEADERSHIP; author of The Transformational Leader (1997).

Tiger market Group of Asian countries—Singapore, Taiwan, South Korea, and Hong Kong—seen as emerging markets in the 1990s. Compare DRAGON MARKETS.

Time and motion study Business efficiency technique combining the time study of F. W. TAYLOR and motion study of FRANK and LILLIAN GILBRETH. It is an element of scientific management or Taylorism. The integrated system is also known as methods engineering.

Time-based competition Analysis of the time elapsed between order receipt to delivery, as a way of compressing the process. It also adds value by aligning promised lead times with actual lead times, promised quality with actual quality, and promised quality with actual quality. It is an extension of JUST-IN-TIME to every aspect of the product delivery cycle.

Time budget Detailed timetable assigning times for each unit of work.

Time fence Period during which a master production schedule may not be changed, lest it destabilize the production schedule.

Time horizon Time frame for completing a task as it extends into the future.

Time management Efficient use of time through prioritization of tasks and elimination of unimportant or unproductive tasks.

Time pacing Practice of producing or introducing new products according to a given schedule.

Time-series analysis Market research technique for forecasting sales by breaking down trends, cycles, seasons, and other variables.

Time sovereignty Control over the way a person spends his or her work time, especially the ability to manage time without reference to the clock.

Time span of discretion Setting salary scales and differentials on the basis of a formal evaluation of performance, especially the way an employee handles responsibilities without supervision. Term coined by economist ELLIOTT JAQUES.

Time to market Period between initial concept and finished product, including its introduction in the market.

Tipping point Point at which a new idea or product attains the CRITICAL MASS to become commercially feasible and reproducible.

Tire kicker Consumer who superficially checks out merchandise, without any real intention of buying it.

Title inflation Practice of giving employees high-sounding titles without the accompanying increase in authority, pay, or status.

Tobin, James (1918–2002) American economist who served on the Council of Economic Advisers taught at Harvard and Yale universities. He was a Keynesian who advocated government intervention in the economy. He pioneered contributions to the study of investment, monetary and fiscal policy, and financial markets. He received the Nobel Prize in Economic Sciences in 1981. His book, Is Growth Obsolete? (1972), introduced the Measure of Economic Welfare for economic sustainability assessment.

Toehold Initial stake in a company, acquired as preliminary to a formal TAKEOVER BID.

Toffler, Alvin (1928–) American futurist, author of The Future Shock and The Third Wave. His work studied the digital revolution, communication revolution, and technological singularity.

Tokenism In human resources, a superficial effort at diversity by having a nominal minority representation, without assigning real power to the employees.

Tolerance Defined limits within which deviation or a departure from the norm may be tolerated, as in quality control or engineering.

Tolerance for ambiguity Ability to handle complexity or lack of clarity in situations and to welcome conflicting interpretations and perspectives.

Too big to fail Notion developed during the financial crisis of 2008 that some financial institutions have such a decisive influence on the economy that their failure would cause massive losses and bring great disruption. This notion carried the implication that CENTRAL BANKS and governments would bail out such institutions even if they failed because of their own greed or improprieties. The principle creates a MORAL HAZARD by suggesting that there will be no consequences for illegal or very risky actions.

Top-down Originating and proceeding from the top echelons and percolating to the bottom, as opposed to BOTTOM-UP.

Top-down design Approach to product design based on general principles or deductive reasoning, rather than empirical research or user feedback. Compare BOTTOM-UP DESIGN.

Top-down or Bottom-up design Strategies of information processing and knowledge ordering mostly concerned with software. Top-down (also called step-wise design) involves analysis, decomposition, and synthesis and begins with the big picture. Bottom-up assembles or links smaller subunits to create the grand picture or form a complex whole.

Top management Highest echelon in a corporate organization.

Total market demand Total volume of the potential demand for a product or service by a defined group, in a defined area, and during a defined period.

Total productive management (TPM) Management approach that empowers employees operating equipment to take responsibility for routine maintenance and to develop a proactive schedule of failure prevention.Considered an integral part of JUST-IN-TIME and TOTAL QUALITY MANAGEMENT. TPM eliminates downtime and thus increases productivity.

Total Quality Management (TQM) Holistic approach to management that integrates all elements of production to achieve quality and efficiency. The approach was pioneered by management experts including W. EDWARDS DEMING, ARMAND V. FEIGENBAUM, KAORU ISHIKAWA, JOSEPH M. JURAN, and GENICHI TAGUCHI. Also termed total quality control.

TQM ensures that all parts of an organization are working in unison and have a part in the success of the program. The principal elements of TQM are (1) long-term commitment by management; (2) commitment to getting things right the first time; (3) commitment to continuous improvement; (4) understanding of the relationships that sustain quality, especially between producers and consumers; (5) understanding that costs are defined not merely in terms of money but also as quality, that monetary savings may not always be quality-friendly; (6) aligning systems to organizational needs, and where they are not so aligned, work processes are redesigned; (7) streamlining communications between staff and management with appropriate training; (8) empowering and enabling workers; and (9) constantly measuring, evaluating, commending, and rewarding performance. The primary responsibility for TQM is assigned to production workers rather than a department.

The principal TQM concepts and categories are:

Goals

1. Habits of improvement are based on CONTINUOUS IMPROVEMENT or KAIZEN.
2. Perfection is based on zero defects and continuous cost reduction.

Basic Principles

1. PROCESS CONTROL is based on continuous inspection by the workforce rather than supervisors.
2. It should involve measurable and easy-to-see quality through display boards and signs monitoring achievements.
3. Insistence on compliance and quality takes precedence over meeting quotas.
4. Each production worker has the ability to stop production if work is substandard.
5. Workers assume full responsibility for all shortfalls in quality. The workforce is expected to work late to make necessary corrections.
6. Every item of output is inspected, not merely random samples.
7. Achievement is for project-by-project improvement.

Facilitating Concepts

1. Responsibility for quality rests with line workers and not the department. It also rests with the suppliers, who receive appropriate training.
2. Small lot sizes make inspection easier.
3. Factories are keep immaculate.
4. Machines are checked daily, not by specialists but also by workers themselves with the help of checklists.

Techniques and Aids

1. Problems are exposed early.
2. Work process is redesigned to avoid mistakes. Machines are fitted in Japan with bakayoke, which checks automatically for abnormal functions.
3. Manual inspection is required for lower volumes. 100% of production is inspected in the case of unstable processes, but in the case of stable processes, sample inspection may be used, restricted to the first and last pieces of a production run.
4. Statistical tools are used, such as CAUSE-EFFECT DIAGRAM.
5. Every corporation has QUALITY CIRCLES to which all employees belong.

Towne, Henry (1844–1924) Pioneer of SCIENTIFIC MANAGEMENT who inspired American engineer F. W. TAYLOR. His best-known work is The Engineer as an Economist (1886). He coined the term GAIN SHARING as part of an attempt to increase worker productivity.

Toyota Production System Manufacturing system developed by Toyota that increases productivity and efficiency by avoiding waste, such as waiting time, overproduction, transportation bottlenecks, and unnecessary inventory, It was developed by Japanese businessman TAIICHI OHNO. It integrates such methods as Lean production, JUST-IN-TIME, KANBAN, and production smoothing.

TPM TOTAL PRODUCTIVE MANAGEMENT

TQM TOTAL QUALITY MANAGEMENT

Trade Economic activity oriented toward the selling of products and services for a profit.

Trade association Professional group of companies engaged in the same business to further their common interests.

Trade description Principal characteristics of a product, designed to inform consumers of exactly what they are getting for their money.

Trade dispute See INDUSTRIAL DISPUTE.

Trade fair Exhibition of products in a special category, bringing together manufacturers, distributors, and consumers.

Trade name Informal name used by a company.

Trade secret Proprietary formula for a product or process, integral to its success and appeal, the disclosure of which is a criminal offense.

Trade union Labor union.

Trademark Distinctive symbol that identifies a product, producer, or trader. It is usually registered with the government and unauthorized use is an infringement that carries penalties.

Tradeoff Compromise based on a balance of advantages and disadvantages or a number of options.

Trading down Reduction of prices and services to customers for increased sales volume.

Trading halt Cessation of trading in a financial market when the price reaches a threshold, or on the basis of a development affecting the stability of the institution.

Trading stamp Stamp or coupon once popular with consumers that can be collected, traded, or redeemed with certain participating retailers for goods of choice.

Trading up Introduction of a product in a new market or in a more exclusive market, without raising prices to compensate for the additional costs.

Training loop Process that assesses, delivers, and reviews training needs.

Trait theory Related to the great man theory, a belief that all leaders display the same key personality traits.

Tranche 1. Part or installment of a large sum of money available to the borrower on reaching a milestone. 2. In a securitization, any of several classes of debt instruments created from the same pool of assets but with different risk ratios to attract different classes of investors.

Transaction costs All aspects of a transaction, including negotiations, monitoring, and enforcement, with two main components: transaction uncertainty and performance ambiguity. The basis for an economic theory developed by economist RICHARD COASE, which stresses the influence of these transaction costs on economic behavior. High transaction costs add to allocative inefficiencies, increase the hierarchical levels through which they have to pass, and affect the quality and quantity of the information transmitted.

Transactional leadership Introduced by management guru JAMES M. BURNS, a term to describe a manager who pursues the achievement of goals without being stymied by a concern for the nature of these goals. Contrast with TRANSFORMATIONAL LEADERSHIP.

Transfer of training Continued application of skills and learning gained during training to the actual work environment.

Transfer price Price at which goods and services are bought and sold between divisions or subsidiaries within a group of companies.

Transformational leadership Visionary leadership style that inspires loyalty and confidence among followers and motivates them to do more than they are required to do. Transformational leadership acknowledges the individual contributions of team members, encourages free exchange of ideas, shares credit for achievements, and takes responsibility for failures. See also TRANSACTIONAL LEADERSHIP.

Transnational organization See MULTINATIONAL COMPANY.

Transparency In business, the quality of being open about goals and methods and sharing positive as well as negative developments, as well as in compliance with legal and moral requirements.

Tribology In engineering, the interaction of surfaces through friction, including design of bearings and the application of lubricants.

Trickle-down economics Belief that wealth earned at the top, by large corporations and wealthy individuals, makes its way down slowly but surely to the underclasses.

Triple I organization Identified by management guru CHARLES HANDY, a corporate culture in which the focus is on three areas—information, intelligence, and ideas—contrasted with a hierarchical culture.

Triple witching hour Third Friday in March, June, September, and December (quarters) when stock index OPTIONS, FUTURES, and individual stock options all expire at the same time, adding potential of volatility to the markets.

Troubleshooting Dealing with unexpected problems in production, distribution, or personnel.

Trist, Eric (1909–1993) British pioneer in the field of organizational development and founder of the Tavistock Institute for Social Research in London.

True and fair view Accounting term to indicate that a set of accounts is a fair presentation and complies with all legal requirements.

Trust 1. Form of monopoly in which the owners of merging corporations yield their stock to a board of trustees empowered to act on their behalf. It is outlawed under ANTITRUST LAWS. 2. Arrangement under which property is held by an appointed person (trustee) on behalf of the beneficiaries.

Trust-control dilemma Problem confronting managers regarding how much to delegate to employees, how much to trust them to do the work, and how much to control that work.

Turbulence In business, unpredictable and swift changes in the organizational environment and structure, leading to a shakedown in the functions and authority of the employees.

Turkey farm Part of the organization to which the most inefficient employees are assigned or exiled, so that they do not affect the morale of the remaining employees.

Turnaround Strategy to reverse a decline in profitability or sales, thereby putting the company back on the road to recovery. This may be achieved through DOWNSIZING, divesting the company of all but its core operations, and managerial changes. The areas where turnaround strategies focus are (1) management vision; (2) leadership role of CEO and chairman; (3) board of directors; (4) core businesses; (5) diversification; (6) financial control; (7) organizational structure; (8) competition, price, and product; (9) cost structure and disadvantages; (10) operating inefficiencies; (11) changes in market demand; (12) adverse movement in commodity prices; (13) lack of marketing effort; (14) underestimates of capital requirements; (15) capacity expansion; (16) failed acquisitions; (17) high debt/equity ratio; (18) financial policies; and (19) overtrading. Successful turnaround strategies include: (1) change in management, (2) strong financial control, (3) decentralization, (4) new product focus, (5) improved marketing, (6) growth through acquisition, (7) asset reduction, (8) cost reduction, and (9) debt restructuring.

Turnover Total sales of a company for a stated period.

Tversky, Amos Nathan (1937–1996) Israeli psychologist. Much of his early work was concerned with measurement. He coauthored Foundations of Measurement. Together with DANIEL KAHNEMANN he developed PROSPECT THEORY, which explains irrational economic choices. It is one of the seminal theories in behavioral economics.

Twinning Partnership of companies and universities, especially in R&D.

Two faces of power Duality in the exercise of power, one benign and the other self-aggrandizing; inherent in the control functions of authority.

Two-factor theory Concept of work-study engineer FREDERICK HERZBERG that job performance is driven by motivators in what he termed “hygiene factors.”

Type A personality Person with hyperactive personality traits, who is impatient with delays, dictatorial in dealing with associates, hard-driving, and aversive to leisure.

Type B personality Person who is easy going, a good listener, slow and deliberate in manner and speech, has extensive interests outside of work, and is articulate.

Type T personality Person who deliberately enjoys taking risks and does not consider consequences in adopting a course of action.