MST-24306 Management summary book: Fundamentals of Management
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MST24306 (MST24306)
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Wageningen University (WUR)
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Fundamentals of Management, Global Edition
This is a summary of the book Fundamentals of Management. The summary consists of 50 pages, in which all 15 chapters are summarized. This summary was made in the academic year of .
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Management
Chapter 1: managers and management
Managers work in an organizational setting. An organization is a deliberate arrangement of
people brought together to accomplish some specific purpose.
What 3 characteristics do all organizations share?
1. Distinct purpose: typically expressed as a goal or set of goals.
2. Achieving goals: people make decisions and engage in work activities to make the
desired goal a reality.
3. Structure that defines and limits the behavior: rules and regulations might guide what
people can and can’t do.
How are managers different from nonmanagerial employees?
Managers are individuals in an organization who direct and oversee the activities of other
people in the organization so organizational goals can be accomplished.
What titles do managers have?
Top managers: responsible for making decisions about the direction of the organization
and establishing policies and philosophies that affect all organizational members;
Middle manager: manage other managers or nonmanagerial employees;
First-line manager: directing all-day-activities;
Team-leaders: responsible for managing and facilitating activities of a work team.
What is management?
Management is the process of getting things done, effectively and efficiently, with and
through other people. A process refers to a set of ongoing and interrelated activities.
Efficiency means doing a task correctly and getting the most output from the least amount of
inputs. Managers are also concerned with completing activities, we call this effectiveness.
Describe what managers do:
4 function approach: then: plan, organize, command, coordinate and control. Now:
Planning: defining goals, establishing strategy, developing plans.
Organizing: determining tasks, who does them, who reports to whom.
Leading: motivating employees, directing activities, selecting communicating channels.
Controlling: monitoring performance, comparing it with goals, correcting.
Management role approach:
Interpersonal roles: figurehead, leader and liaison.
Informational roles: monitor, disseminator and spokesman.
Decisional roles: entrepreneur, disturbance handler, resource allocator and negotiator.
Skills and competencies:
Conceptual skills: analysing and diagnosing complex situations to see how things fit
together and to facilitate making good decisions.
Interpersonal skills: working well with other people both individually and in groups by
communicating, motivating, mentoring and delegating.
Technical skills: job-specific knowledge, expertise and techniques needed to perform
tasks.
Political skills: building a power base and establishing the right connections so they can
get needed resources for their groups.
Level in the organization: As managers move up in the organization, they do more planning
and less direct overseeing of others. All managers make decisions.
Profit and not-for-profit: the most important difference is how performance is measured.
Size of an organization: a small business is an independent business with less than 500
employees that doesn’t necessarily engage in any new or innovative practices and has
relatively little impact on its industry.
, Management
Roles played by Managers in Roles played by Managers in
Small Firms Large Firms
High
Spokesperson Resource allocator
Management concepts and national borders:
If managerial concepts were completely generic, they would also apply universally in any
country in the world. Most of the concepts discussed in the following chapters, apply to the
USA, Canada, GB, Australia English speaking countries.
Why are customers important to the manager’s job?
Without customers, most organizations would cease to exist. Yet, focusing on the customer
has long thought to be for marketing people recognizing that delivering consistent high-
quality customerservice is essential for survival and success.
Why is innovation important to the manager’s job?
Innovation means doing things differently, exploring new territory and taking risks. Innovations
are needed in all types of organizations. Managers not only need to be innovative personally,
but encourage their employees to be innovative as well.
Importance of social media to the manager’s job?
Today, the new frontier is social media. Social media is impacting how managers manage,
especially in the areas of human resource management, communication, teams and
strategy.
Importance of sustainability to the manager’s job?
Sustainability has been defined as a company’s ability to achieve its business goals and
increase long-term shareholder value by integrating economic, environmental, and social
opportunities into its business strategy. Sustainability issues are now moving up the agenda of
business leaders and the board of thousands of companies.
Managing matters:
The relationship with their managers is the largest factor in employee engagement is
accounting for at least 70% of an employee’s level of engagement. Recently, however, one
factor that has affected how employees view their manager is the lingering global recession.
Since the economic downturn, employees may be more concerned with that and less with
their managers. However, the way a company manages its people can significantly affect its
financial performance.
, Management
Chapter 2: the management environment
What is the external environment and why is it important?
External environment refers to factors, forces, situations, and events outside the organization:
Economic component: interest rates, inflation, income, stock markets etc.;
Demographic component: age, race, gender, education, location, family etc.;
Sociocultural component: values, attitudes, lifestyle, beliefs, behaviour etc.;
Political/legal component: looks at federal state, local and international laws etc.
How has the economy changed?
The ‘Great Recession’ affected businesses as credit markets collapsed Credit was no
longer available low interest rates for a long period of time, fundamental flaws in the U.S.
housing market, and massive global liquidity. All these factors led businesses and consumers
to become highly leveraged.
Economic inequality and the economic context:
As economic growth has languished and sputtered, social discontent over growing income
gaps has increased business leaders need to recognize how societal attitudes in the
economic context also may create constraints as they make decisions and manage their
businesses. The other external component is demographics, as changes and trends in this
component tend to be closely linked to workplace and managing.
What role do demographics play?
Demographics, the characteristics of a population used for purposes of social studies, can
and do have a significant impact on how managers manage. Age groups:
Baby Boomers: 1946-1964 large group significant impact on external environment.
Gen X: 1965-1977 smaller group imprint on the external environment.
Gen Y: 1978-1994 children of baby boomers impacting organizational workplaces
also called millennials.
Post-millennials: 1995- also called iGeneration because of the technology.
How does the external environment affect managers?
Jobs and employment: one of the most powerful constraints managers face the impact of
such changes on jobs and employment. External environment affect how jobs are created
and managed. Many employers are using flexible workers.
Assessing environmental uncertainty: environmental uncertainty: the degree of change and
complexity in an organization’s environment. The first dimension is the degree of
unpredictable change. If the components in an organization’s environment change
frequently, it’s a dynamic environment. If change is minimal, it’s a stable one: few
competitors and little technological change. The other dimension describes the degree of
environmental complexity the number of components in an organization’s environment
and the extent of the knowledge that the organization has about those components.
Managing stakeholder relationships: stakeholders: constituencies in an organization’s
environment that are affected by the organization’s decisions and actions. The organization
influence the stakeholders and vice versa. Managers should care about stakeholders: (1) it
can lead to desirable organizational outcomes (improved predictability of environmental
changes, more successful innovations, greater degree of trust, and greater organizational
flexibility to reduce the impact of change). (2) it’s the right thing to do. An organization
depends on these external groups as sources of inputs and as outlets for outputs.
What is organization culture?
1. Culture is perceived: not physical, but employees perceive it on the basis of what they
experience within the organization.
2. Culture is descriptive: it’s concerned with how members perceive or describe the culture,
not with whether they like it.
, Management
3. Culture is shared: individuals tend to describe the organization’s culture in similar terms.
Dimensions of organizational culture:
Degree to which managers
Degree to which employees are expected to focus on results or outcomes
exhibit precision, analyse, and attention to rather than on how these
detail. outcomes are achieved.
Attention
Degree to
to detail
which
employees are
Innovation
encouraged to Outcome Degree to which
and risk
be innovative orientation management decisions take
taking
and to take into account the effects on
risks. people in the organization.
Organizational
culture
Degree to which
People
organizational Stability
orientation
decisions and
action emphasize
maintaining the Degree to
status quo. which work is
Team organized
Agressiveness orientation around
teams rather
than
individuals.
Degree to which employees are
aggressive and competitive rather
than cooperative.
How does organizational culture affect managers?
The two main ways that an organizational culture affects managers:
Its effect on what employees do and how they behave: strong—culture has a greater
influence on employees than weaker-cultures. The more employees accept the
organization’s key value and the greater commitment to those values, the stronger the
culture is. Also, in organizations with strong cultures, that culture can substitute for the rules
and regulations that formally guide employees.
Its effect on what managers do: on organization’s culture constrains what manager can
and cannot do.
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