Chapter 16: Leadership

Leader –Is someone who can influence others and who has managerial
authority
Leadership – What leaders do; the process of influencing a group to
achieve goals
Ideally, all managers should be leaders

-Managerial Grid
- Appraises leadership styles using two dimensions:
1. Concern for people
2. Concern for production
- Places managerial styles in five categories:
1. Impoverished management
2. Task management
3. Middle-of-the-road management
4. Country club management
5. Team management
 Contemporary Views on Leadership
Transactional Leadership Transformational Leadership Charismatic Leadership
Leaders who guide or Leaders who inspire An enthusiastic, self-confident
motivate their followers followers to transcend their leader whose personality and
in the direction of own self-interests for the actions influence people to
established goals by good of the organization by behave in certain ways.
clarifying role and task clarifying role and task Characteristics of Charismatic
requirements. requirements. leaders:
Leaders who also are -Have a vision.
capable of having a -Are able to articulate the vision.
profound and extraordinary -Are willing to take risks to
effect on their followers. achieve the vision.
-Are sensitive to the environment
and follower needs.
-Exhibit behaviors that are out of
the ordinary.

Visionary Leadership Team Leadership

It goes beyond charisma since it is the ability Team Leadership Characteristics
to create and articulates a realistic, credible, -Having patience to share information
and attractive vision of the future that -Being able to trust others and to give up
improves upon the present situation. authority
A vision should offer clear and compelling -Understanding when to intervene
imagery that taps into people’s emotions and Team Leader’s Job
inspires enthusiasm to pursue the -Managing the team’s external boundary
organization’s goal) -Facilitating the team process
Visionary leaders have the ability to: -Coaching, facilitating, handling
-Explain the vision to others. disciplinary problems, reviewing team
-Express the vision not just verbally but and individual performance, training,
through behavior. and communication
-Extend or apply the vision to different
leadership contexts.
-Specific Team Leadership Roles:
-Coach: Clarifies roles, teach, offer support, and help to keep his team
performance high
-Liaison with External Constituencies: Represents the team, secures
needed resources, Gathering information and share it with his team,
-Conflict Manager: Identifies source, who involved, resolution options, and its
advantages and disadvantages
-Troubleshooter: Set on meetings to assist his team solving the problems that
faces them
-Managing Power
1) Legitimate power
The power a leader has as a result of his or her position.

2) Coercive power
The power a leader has to punish or control.

3) Reward power
The power to give positive benefits or rewards.

4) Expert power
The influence a leader can exert as a result of his or her expertise, skills, or
knowledge.

5) Referent power
The power of a leader that arise because of a person’s desirable resources or
admired personal traits.
Credibility (of a Leader) Trust
The assessment of a leader’s honesty, Is the belief of followers and others in the
competence, and ability to inspire by his or integrity, character, and ability of a leader.
her followers
Dimensions of trust: integrity, competence,
consistency, loyalty, and openness.

Chapter 17: Introduction to Controlling

- Define controlling.
Controlling: Is the process of monitoring activities to ensure that they are being
accomplished as planned and of correcting any significant deviations.

-The Purpose of Control

To ensure that activities are completed in ways that lead to accomplishment of
organizational goals.
-Why Is Control Important? (Discuss the reasons why control is important)
As the final link in management functions:
-Planning
Controls let managers know whether their goals and plans are on target and what
future actions to take.
-Empowering employees
Control systems provide managers with information and feedback on employee
performance.
-Protecting the workplace
Controls enhance physical security and help minimize workplace disruptions.
Describe the three steps in the control process.
The Process of Control:
1. Measuring actual performance
2. Comparing actual performance against a standard
3. Taking Managerial action
Step 1: Measuring
How and What We Measure
Control Criteria (What) Sources of Information (How)
Employees :

 Satisfaction – Personal observation

 Turnover – Statistical reports
 Absenteeism – Oral reports
– Written reports
Budgets :

 Costs
 Output
 Sales

Common Sources of Information for Measuring Performance

 Step 2: Comparing

Determining the degree of variation between actual performance and the

standard.

Significance of variation is determined by:

– The acceptable range of variation from the standard (forecast or

budget).
– The size (large or small) and direction (over or under) of the variation
from the standard (forecast or budget).

Step 3: Taking Managerial Action

 Courses of Action:

1) Doing nothing

Only if deviation is judged to be insignificant.

2) Correcting actual (current) performance

 Immediate corrective action to correct the problem at once.

 Basic corrective action to locate and to correct the source of the deviation.
 Corrective Actions :

Change strategy, structure, compensation scheme, or training programs; redesign

jobs; or fire employees

3) Revising the standard

 Examining the standard to ascertain whether or not the standard is realistic,

fair, and achievable.
 Upholding the validity of the standard.
 Resetting goals that were initially set too low or too high.

- Contrast feed forward, concurrent, and feedback controls (Types of Control)

Feed forward Control Concurrent Control Feedback Control

A control that prevents A control that takes place A control that takes place after an
anticipated problems before while the monitored activity is done.
actual occurrences of the activity is in progress.
problem. Corrective action is after-the-fact,
Direct supervision: when the problem has already
Building in quality through management by walking occurred.
design around
Advantages of feedback controls:
Requiring suppliers
conform to ISO 9002 Provide managers with information
on the effectiveness of their
planning efforts.

Enhance employee motivation by

providing them with information on
how well they are doing.
 Types of Control Systems
Market Control Bureaucratic Control Clan Control
Emphasizes the use of external Emphasizes organizational Regulates behavior by
market mechanisms to establish authority and relies on shared values, norms,
the standards used in the control administrative and hierarchical traditions, rituals, and
system. mechanisms, such as rules, beliefs of the firm’s
External measures: price regulations, procedures, and culture. Organizations in
competition and relative market policies, standardization of which teams are common
share, to establish standards used activities, well-defined job and technology is
in system. descriptions, and budgets to changing rapidly.
Organizations whose products or ensure that employees exhibit
services are clearly specified and appropriate behaviors and meet
distinct and that face performance standards.
considerable marketplace
competition.
 Chapter 6: Managers as Decision Makers

Decision
• Making a choice from two or more alternatives.
The Decision-Making Process
• Identifying a problem and decision criteria and allocating weights to
the criteria.
• Developing, analyzing, and selecting an alternative that can resolve
the problem.
• Implementing the selected alternative.
• Evaluating the decision’s effectiveness.
Example:
• Sarah is a sales manager whose reps need new laptops because their old ones
are outdated and inadequate for doing their job. To make it simple, assume
that it is not economical to add memory to the old computers and it is the
company’s policy to purchase, not lease.

The Decision-Making Process

Step 1: Identifying the Problem
Problem
• A discrepancy between an existing and desired state of affairs.
Characteristics of Problems
• A problem becomes a problem when a manager becomes aware of it.
• There is pressure to solve the problem.
• The manager must have the authority, information, or resources
needed to solve the problem.
Step 2: Identifying Decision Criteria
Decision criteria are factors that are important (relevant) to resolving the
problem such as:
• Costs that will be incurred (investments required)
• Risks likely to be encountered (chance of failure)
• Outcomes that are desired (growth of the firm)
Step 3: Allocating Weights to the Criteria
Decision criteria are not of equal importance:
• Assigning a weight to each item places the items in the correct priority
order of their importance in the decision-making process.

Step 4: Developing Alternatives

Identifying viable alternatives
• Alternatives are listed (without evaluation) that can resolve the
problem.
Step 5: Analyzing Alternatives
Appraising each alternative’s strengths and weaknesses
• An alternative’s appraisal is based on its ability to resolve the issues
identified in steps 2 and 3.
Step 6: Selecting an Alternative
Choosing the best alternative
• The alternative with the highest total weight is chosen.
Step 7: Implementing the Alternative
Putting the chosen alternative into action
• Conveying the decision to and gaining commitment from those who
will carry out the decision
Step 8: Evaluating the Decision’s Effectiveness
The soundness of the decision is judged by its outcomes
• How effectively was the problem resolved by outcomes resulting from
the chosen alternatives?
• If the problem was not resolved, what went wrong?
 Types of Problems and Decisions
Structured Problems Unstructured Problems
• Involve goals that are clear • Problems that are new or unusual
• Are familiar (have occurred before) and for which information is
• Are easily and completely defined ‒ ambiguous or incomplete.
information about the problem is • Problems that will require
available and complete custom-made solutions.
Programmed Decision Nonprogrammed Decisions
A repetitive decision that can be handled by Decisions that are unique and
a routine approach. nonrecurring.
Types of Programmed Decisions : Decisions that generate unique
1) Procedure responses.
A series of interrelated steps that a manager
can use to respond (applying a policy) to a
structured problem.
Example: Follow all steps for completing
merchandise return documentation.
2) Rule
An explicit statement that limits what a
manager or employee can or cannot do.
Examples:
-Managers must approve all refunds over
$50.00.
-No credit purchases are refunded for cash.
3) Policy
A general guideline for making a decision
about a structured problem.
Example: Accept all customer-returned
merchandise.
 Chapter 2: Management History

-Major Approaches to Management

Historical Background of Management
• Ancient Management
Egypt (pyramids) and China (Great Wall) are tangible evidences that reflect the
ancient management.(P.O.L.C) Tremendous no of employed people.
Venetians (floating warship assembly lines) in 1400s, and as a major economic and
trade center.
Adam Smith
• Published The Wealth of Nations in 1776
• Advocated the division of labor (job specialization) to increase the
productivity of workers
• Observed that firms manufactured pins in one of two different ways:
Craft-style—each worker did all steps.
Production—each worker specialized in one step.
Realized that job specialization resulted in much higher efficiency and productivity
Breaking down the total job allowed for the division of labor in which workers
became very skilled at their specific tasks
Industrial Revolution
• Substituted machine power for human labor
• Created large organizations in need of management
  Describe the important contributions made by Frederick W.
Taylor and Frank and Lillian Gilbreth.
Scientific Management

Fredrick Winslow Taylor

• The “father” of scientific management

• Published Principles of Scientific Management (1911)
• The theory of scientific management
Using scientific methods to define the “one best way” for a job to be
done:
Putting the right person on the job with the correct tools and equipment.
Having a standardized method of doing the job.
Providing an economic incentive to the worker.
 Taylor’s Scientific Management principles
1. Develop a science for each element of an individual’s work, which
will replace the old rule-of-thumb method.
2. Scientifically select and then train, teach, and develop the worker.
3. Heartily cooperate with the workers so as to ensure that all work is
done in accordance with the principles of the science that has been
developed.
4. Divide work and responsibility almost equally between management
and workers. Management takes over all work for which it is better fitted
than the workers.
 Frank and Lillian Gilbreth

• Focused on increasing worker productivity through the

reduction of wasted motion.
• Developed the microchronometer to time worker motions and
optimize work performance.
How Do Today’s Managers Use Scientific Management?
• Use time and motion studies to increase productivity.
• Hire the best qualified employees.
• Design incentive systems based on output.
General Administrative Theory
Discuss Fayol’s and Weber’s contributions to management theory.

Henri Fayol

• Believed that the practice of management was distinct from

other organizational functions.
• Developed principles of management that applied to all
organizational situations.

-Fayol’s 14 Principles of Management:-

1. Division of Work. Specialization increases output by making
employees more efficient.
2. Authority. Managers must be able to give orders and authority gives
them this right.
3. Discipline. Employees must obey and respect the rules that govern the
organization.
4. Unity of command. Every employee should receive orders from only
one superior.
5. Unity of direction. The organization should have a single plan of
action to guide managers and workers.
6. Subordination of individual interests to the general interest. The
interests of any one employee or group of employees should not take
precedence over the interests of the organization as a whole.
7. Remuneration. Workers must be paid a fair wage for their services.
8. Centralization. This term refers to the degree to which subordinates
are involved in decision making.
9. Scalar chain. The line of authority from top management to the
lowest ranks is the scalar chain.
10. Order. People and materials should be in the right place at the right
time.
11. Equity. Managers should be kind and fair to their subordinates.
12. Stability of tenure of personnel. Management should provide
orderly personnel planning and ensure that replacements are available to
fill vacancies.
13. Initiative. Employees who are allowed to originate and carry out
plans will exert high levels of effort.
14. Esprit de corps. Promoting team spirit will build harmony and
unity within the organization.
 Max Weber

-Developed a theory of authority based on an ideal type of organization

(bureaucracy).
-Emphasized rationality, predictability, impersonality, technical
competence, and authoritarianism.
Weber’s Bureaucracy
 Quantitative Approach
Explain what the quantitative approach has contributed to the field of
management.
Quantitative Approach
• Also called operations research or management science.
• Evolved from mathematical and statistical methods
developed to solve WWII military logistics and quality
control problems.
• Focuses on improving managerial decision making by
applying:
 statistics
 optimization models
 information models
 computer simulations

Systems approach
Describe an organization using the systems approach.
System Defined
A set of interrelated and interdependent parts arranged in a manner that
produces a unified whole
Basic Types of Systems
Closed systems Open systems
Are not influenced by and do not Dynamically interact to their
interact with their environment (all environments by taking in inputs and
system input and output is internal). transforming them into outputs that are
distributed into their environments.
The Organization as an Open System

Implications of the Systems Approach:

• Coordination of the organization’s parts is essential for proper
functioning of the entire organization.
• Decisions and actions taken in one area of the organization will
have an effect in other areas of the organization.
• Organizations are not self-contained and, therefore, must adapt to
changes in their external environment.