Management Chapters 1-2 PDF

27/09 What is management (Chapter 1) Chapter 1 Who are managers and where do they operate Someone who coordinates and oversees work of their Manager subborindates so organizati...

27/09 What is management (Chapter 1) Chapter 1 Who are managers and where do they operate Someone who coordinates and oversees work of their Manager subborindates so organizational goals can be achieved First-line (frontline) Coordinate non-managerial employees who are directly involved in manager service or production Between top managers and first line managers, purpose is to turn Middle manager the organisations strategy into action Make organisation wide decisions and establish the strategies and Top managers goals for the entire organisation A deliberate arrangement of people to accomplish some specific Organisation purpose. Typically requires a purpose, people and an organisational structure Coordinating and overseeing the work and activities of others to Management ensure activities are completed efficiently and effectively Getting the most output from the least input of sources (doing things Efficiency right) Effectiveness Doing the right things to achieve a goal (doing the right things) Specific actions or behaviours expected of and exhibited by Managerial roles managers Universality of Practice of management is needed in all types and sizes of Management organisation What is management? Importance of managers: Managers are critical to get things done, if managers don’t exist nothing will be done, they affect organisational performance, they are needed in complex uncertain times 27/09 What is management (Chapter 1) 1  Poor management consists of Lack of people skills No safety strategy Poor organisation Poor leadership Poor communication Poor control Poor decisions No motivation No safety culture Management is the art of getting things done through people!! 1. To assist with their managerial skills and abilities in complex, uncertain and chaotic times 2. To get things done 3. To make an organisation more efficient and enhance performance Function of managers: Are not sequential!! 1. Plan (Top managers, middle managers) 2. Organize (Middle managers) 3. Lead (Middle managers, first line managers) 4. Control (Middle managers) Difference between business unit and department: Business unit based of market Department is based of function Value chain of porter: 27/09 What is management (Chapter 1) 2  Activities in companies that add immediate value to what is being sold (first line manager) Support activities: Assist but do not directly add value (staff manager) Skills required by a manager: 1. Conceptual→ understand abstract and complex situations, analysing skills (mostly top managers) 2. Interpersonal (human)→ ability to work in a group and alone (all levels of managers) 3. Technical → job specific knowledge required (mostly first line manager) Stressors for starting managers: bad work life balance Different relationship with peers High responsibility Increased workload Being caught up in the middle Emotional intelligence: Self awareness Self management Social awareness and empathy Relationship management Managerial Challenges 1. Technology 2. Social media 3. Ethics 4. Political uncertainty a. How to deal with organisational politics 27/09 What is management (Chapter 1) 3  i. Frame arguments in terms of organisational goals ii. Develop the right image iii. Gain control of organisational recources iv. Make yourself appear indispensable v. Be visible vi. Develop powerful allies vii. Avoid ‘tainted’ members viii. Support your boss 5. The customer Types of organisation: Small business: less hierarchy less specialisation less resources much entrepreneurship Non-profit Less tangible added value High accountability Different culture and values Questions: 1. Kelly a production supervisor is responsible for 10 employees who assemble components into finished products. Kelly is a…. a. Top manager b. Non managerial employee 27/09 What is management (Chapter 1) 4  c. Middle manager d. First line manager 2. If your team quickly painted the wall employing the least of paint, but discovered afterward it was the wrong wall your team would be a. Efficient but ineffective b. Efficient and effective c. Effective but inefficient d. Neither effective not efficient 3. Today the basic management functions include a. Planning, organising, commanding, controlling b. Planning, organising, coordinating, controlling c. Planning, organising, directing, controlling d. Planning, organising, leading, controlling 4. When Fred tells the employees that he is sure that they can fulfill teh schedule beacuse they are good and skilled employees he is fulfilling which of the following managemnt functions? a. Controlling b. Leading c. Negotiating d. Delegating 5. Katz proposed that managers need ….. skills a. Technical, human, financial b. Human, empirical and mechanical c. Technical, interpersonal and legal d. Technical, human and conceptual 6. Brendas ability to produce the same amount of product with fewer personal is a reflection of her 27/09 What is management (Chapter 1) 5  a. Effectiveness b. Process skills c. Leadership d. Efficiency Answer key: 1c, 2a, 3d, 4b, 5d, 6d Book extra: Managers face challenges through: Focus on technology Focus on disruptive innovation Social media Ethics Political uncertainty The customer 27/09 What is management (Chapter 1) 6  02/10 Looking forward thinking backward (Chapter 2) Why do we need theories? There is nothing as practical as good theory- knowledge should be applicable in practice Management theories reflect their era of development!!! Management theories relate to earlier ideas Refining existent theories (fayol and smith) Opposing existent theories (behavioural approach vs scientific management) Classical Ideas Adam Smith: Divison of labor to enhance the productivity of workers through specialisation Organising principle During era of industrial evolution→beforehand, everyone believed in doing their own things then specialisation started (farming their own stuff, building their own things) The idea of collective production in factories and specialization → let the farmer farm your vegetables and let them do a better job Led to enhancing productivity through specialization, average production per worker increased Frederick Taylor: Scientific management theory lead to superior practices by optimising worker activities to optimise productivity Front line activities 1910 during mechanised car and steel production 02/10 Looking forward thinking backward (Chapter 2) 1  Improved shop floor efficiency (studies on movement of workers to ensure everything they do lead to productive outcomes) Breaking down complex tasks into simpler ones, standardizing work processes, and providing workers with clear instructions and training to achieve maximum efficiency Many manufacturing businesses use Taylor's principles to structure their staff benefits e.g. piece rate pay Production lines involving human labour are often set up based on these principles Henri Fayol: Good Management (principles of management)→ optimise management practices , effectuating managerial functions Focused on higher and middle management During industrial mass production and also mostly appropriate for such time Many theories in management book come from him Top management practices Effectuating managerial functions Max Weber: bureaucracy During industrial revolution Installed rules and hierarchies Only higher-ups make decisions Optimizing the human machine Adv: Structuring complex organizations, how to deal with large organisations Dis: Demotivating, pushes creativity away, worker exploitation Behavioural Approaches Mary Parker Follett: Going human, foregrounding humans 02/10 Looking forward thinking backward (Chapter 2) 2  During tense social relations Proposed that the human side of organizing needs to be looked into Implemented informal processes and conflict resolution Integrative bargaining → there can always be something in it for everyone as not everyone wants the same thing Foregrounding humans Elton Mayo: spotlighting humans During industrial mass production Zoomed in on human side Fosters human attentions and interactions realised it through type of light experiment Nurturing social interactions Chester Barnard: Effectively cooperating During industrial mass production Human factor in cooperation Mobilising power and morality for cooperation Shown in empowerment Globalising individuals and looking at morality Adv: Leveraging on willpower and social interactions DIs: Sidestepping rational structures and processes leading to organisations not lasting long Contemporary Approaches Edwards Deming: Quantifying Quality After military inventions Obsessed with quality of machines etc 02/10 Looking forward thinking backward (Chapter 2) 3  Created continuous improvement (Deming cycle) Connection to foyel Created quality circles Effectuating circles of performance improvement Many contributors: Open system perspectives Unpredictable, complex business systems Acknowledges that many factors are beyond ones control Focus on direct and indirect interactions within and outside business organisations (CSR) Overseeing global implications of local actions Many contributors: Contingency approach There isn’t a one size fits all → what is appropriate in one situation could be bad in another Performance depends on differentiating factors Technology, size, sector, environmental, complexity and uncertainty, … as contingencies Attuning actions to contingencies Pfeffer and Salancik: Resource dependence theory state that organisations depend on external resources Focus on securing resources Effectuating governance to control resources (Lobbyist, merger and acquisitions) Many contributors: Institutional approach Taken-for-granted collective arrangements shape organisational behaviour Formal and informal institutions enable and constrain Building and adhering to institutions Many contributors: organisational learning 02/10 Looking forward thinking backward (Chapter 2) 4  Need to adjust in order to survive and thrive Acquiring, sharing, and retaining new insights through experience and observation Learning how to perform better Classical and behavioural approaches are opposite of each other Questions: 1. Which statement is correct? a. Taylors ideas reflected his post industrial era b. Parker Follet rejected irrational management practices c. Deming prioritised quantification over quality advancement d. The open systems perspective contrasts with the closed system perspective of classical approaches 2. Which principle is not part of follets management principle? a. Shop floor description of work tasks b. Specialisation of work tasks c. Centralisation of decision making d. Espirit de corps 3. Which modern practices are not rooted in classical ideas a. Decision making in ministries b. Production tasks in wind turbine factories c. Self organisation of first like medical teams d. Procurement activities in large retailers 4. Wich statement on contemporary approaches is not correct a. Total quality management is a cognitive approach b. Organisational learning is a cognitive approach 02/10 Looking forward thinking backward (Chapter 2) 5  c. Resource dependence theory focuses on external power d. Institutional theory focuses on internal power and politics Answers: 1c, 2a, 3c, 4d Book extra: Hawthorne studies (behavioural approach): Social norms and group standards are the key determinants of individual work behavior Money and other factors are not as important Figured it out through the change of light in factories which should have impacted behavior but didn’t Total quality management (TQM): continuous improvement Cognitive approach Needs accurate measures to benchmark performance 02/10 Looking forward thinking backward (Chapter 2) 6  Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) External Environment PESTLE: Political, economic, social, ecological, technological, legal Environment: Institutions or forces that are outside the organization and potentially affect the organization’s performance Environmental uncertainty: The degree of change and complexity in an organization’s environment, assumes that change is unpredictable Dynamic Environment Components in an organization’s environment change frequently Stable environment Change is minimal Environmental complexity: The number of components in an organization’s environment and the extent of the organization’s knowledge about those components General environment: Everything outside the organization, cannot be influences by organisation Political Political: collective decision-making on societally relevant practices, what we want as a society, government is important part (fiscal incentives and sanctions→income tax, legislation→ rules, networking functions) Political environment: Nongovernmental groups→ stand up for the people by advocating and acting upon governmental issues Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 1  Economic: Production, distribution, and consumption of products and services (Real markets-physical products and services, monetary markets-accommodating of physical products and services) Market structures (Monopoly→ one supplier, oligopoly→ few suppliers with barriers to entry, monopolistic competition→lot of suppliers but different products, perfect competition→many suppliers with same product) Market evolution (Business cycle→ short medium long run, industry evolution→introduction growth maturity decline Geographic differences: (international specialization (factor market differences), international and intranational differences of wealth) Sociocultural Sociology: how do people interact Social structure (Demography, social classes, migration, educational level) Social interactions Degree of harmony Degree of egalitarism Degree of formalism Technological Technology: applying knowledge for practical purposes in a reproducible way First dimension: technology waves First wave (1770s-1830s): early mechanization (activities based on automated ways of working) Second wave (1830s-1880s): steam power and railways (inventions to give a new structure to activities at the time) Third wave (1880s-1930s): electrical and heavy engineering (Energy accommodate new ways of producing) Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 2  Fourth wave (1930s-1970s): industrial mass production. Fifth wave (1970s-present): information, communication, and AI. Second dimension: Innovation types Production innovation: Different goods or services that didn’t exist before Process innovation: revolutionizing the processes of production Third dimension: Innovation degrees Radical innovation: completely new and revolutionary innovations Incremental innovation: minor improvements over already existing products Ecological environment: Ecology: Natural systems Can be enabler and constraint Enablers: Natural resource inputs natural biosystems outputs Constrains: Negative externalities Ecological limits Legal environment: Law: Enforced by government Types of law Common law: Case-based (no upfront set of rules, the court decides) Civil law: Codified Levels of legislation: Supranational legislation: Across nation states (eu) National legislation: In nation state only Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 3  Logal legislation: In municipality/province/region Regulatory stringency Level of ambition and sanctions Specific Environment: The part of the environment consisting of crucial constituencies or stakeholders that can impact an organizations effectiveness Suppliers Customers Competitors Government Pressure groups Market evolution: Business cycle: 5-7 years goes through bull and bear Task environment Task environment: can be directly influenced by the organization Market environment: the competitive context of the organization using 5 force framework by Porter: Suppliers Buyers Rivals New entrants Substitutes and complements Non market environment: Direct interaction with non economic factors Governments Nongovernmental organisations Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 4  Neighbours Environmental uncertainty: These days a new term is frequently used to give insights regarding environments: VUCA (volatility, uncertainty, complexity, and ambiguity) environment. Environmental uncertainty: The extent to which an organization’s context is hard to understand and predict, which means that you don’t know in advance what it’s going to happen Complexity and dynamics are two fundamental components of it. The environmental complexity is number of components and interrelations constituting an organizational context Many components: difficult to chart and oversee all factors Many interrelations: difficult to chart and manage, especially indirect and delayed interrelations The environmental dynamics is degree of unpredictable change in an organization’s context: Degree of change: rate of fluctuation Unpredictability: unknown direction and rate of fluctuation Questions: Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 5  1. Which statement is not correct? a. The political environment includes organisational politics b. The political environment includes governmental sticks and carrots c. The political environment includes NGOs calls for consumer boycots d. The political environment includes NGO lobbying with the government 2. Which statement is correct? a. The general environment is more important than the task environment b. The task environment is more important than the general environment c. The general environment directly influences an organisations activities d. The task environment directly influences an organisations activities 3. Which statement is not correct? a. The economic environment includes the exchange rate in a firm main foreign market b. The economic environment includes monetary policy of the central bank in a firms main market c. The economic environment includes economic inequality in a firms main market d. The economic environment includes a firms price setting strategy in a firms main market 4. Which element is not part of porters five force model? a. Suppliers of inputs b. Suppliers of new products for the same need c. Government offering subsidies d. New suppliers of the same product 5. Which statement is correct? a. IT consultants operate in a dynamic, simple environment b. Lawyers operate in a dynamic, complex environment Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 6  c. Fast fashion producers operate in a stable, simple environment d. Academic researchers operate in a stable, complex environment Answers: 1a,2d, 3d, 4c, 5d Organizational Culture The shared values, principles, traditions, and ways of doing things that influence the way organizational members act and that distinguish the organization from other organizations Structure: The formal arrangement of tasks in a business organisation Importance of structure: Knowing who is in charge of what Allocating resources Creating coherence and consistency among activities What makes up the structure of an organisation Book Profesor Adaptility Attention to detail Outcome Differentiation and integration orientation Centralisation and decentralisation. Formalisation and People orientation informalisation Team orientation Integrity Differentiation and integration: Differentiation: Dividing organisational practise into different tasks by smaller units Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 7  Link to Taylorism Setting up individual tasks to match individual capabilities and to accomplish learning effects Favours efficiency ( as you get better at what you are doing) But decreases motivation ( as u keep doing the same thing) Example: I am better at math so I will focus on math while the person better at english will focus solely on english Doing things again and again (learning effect) so it gets easier over time Creating units to accomplish joint tasks and to cluster related tasks For tasks that can’t be done alone Adv: Generates complementarity Dis: May engender narrow focus Functional departmentalisation: according to function Product departmentalisation: according to type of product Geographic departmentalisation: by location Hybrid departmentalisation: Mixture of two types (geographic+functional) Matrix departmentalisation: horizontal type and vertical type, combining the advantages of different approaches, leads to very complex organisations and unclear responsibility Integration: Coordinating distinct tasks of smaller units to accomplish coherent organisational practices Needs to be within and across units Coordination mechanisms: Direct supervision The classical way, boss says you do this and you do that, span of control: larger with standardised tasks Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 8  Mutual adjustments Standardisation of skills, process and output Centralisation and decentralisation: Centralisation: Concentration of decision making Adv: Low coordination cost Consistency and integrayion Speed of overall response Dis: Info overload Demotivating Slowness of local response Decentralisation: Dispersion of decision making Horizontal (At the same level) Vertical (Degree to which people above or below are involved) Adv: Manageability of info Match with specific expertise Speed of local response Dis: High coordination costs Consistency and integration Slowness of overall response Formalisation and in formalisation: Formalisation: Prescribed characteristics of expected behaviour (fix set of rules on how to behave) Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 9  Adv: Reducing uncertainty Reducing process variability Reducing product variability Enhancing procedural fairness Dissuading undesired behaviour Dis: Ignoring environmental changes Dissuading process improvement options Dissuading desirable product adapations Ignoring situational diversity Dissuading employee creativity In formalisation: Emerging characteristics of expected behaviour Position (Tasks are set up front) Process (Steps that need to be taken) Adv: Responding to the unforseen Improving processes Tailoring products Matching situational diversity Tapping into employee creativity Dis: Provoking uncertainty related anxiety Risking loss of process quality Risking generation of undesired products Risking arbitrary, unfair decisions Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 10  Risking undesirable employee behaviour Contingencies Are not always present Internal contingencies Size and age The larger and older the organisation the more formalised it is The larger the organisation the more elaborate its structure is Technology More regulating technology→ more formalisation (DHL deliverers have lots of formalisation cause of the app) Unit production leads to larger teams working on it (production of a car) External contingencies Environmental complexity (At one point in time) More complex→ more decentralised Environmental turbulence/dynamics (changes in environment) Higher turbulence → more organic structure Viable configurations Configuration: Combination of design elements Basic configuration: Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 11  Simple structure: Machine bureucraccy: Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 12  Taylor organisation, very mechanised, very formalised, very structured Professional bureucraccy: Divisionalised form: Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 13  Adhocracy: Always moving, not very standarised Types of organization Mechanistic: Designed to be rigid and tightly controlled High specialisation rigid departmentalization Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 14  clear chain of command narrow span of control centralisation high formalisation Organic: Highly adaptive and flexible cross-functional teams hierarchical teams free flow of information wide span of control decentralization low formalization Questions: 1. Which statement is not correct? a. Differentiation precedes integration b. More differentiation requires more integration c. Dofferentiation and integration are equally important d. Differentiation is not important in a mono-product organisation 2. Which of the following statements is most correct a. Centralisation is more pronounced in a simple structure b. Centralisation is more pronounced in a machine bureaucracy c. Centralisation is more pronounced professional bureaucracy d. Centralisation is more pronounced adhocracy 3. Which statement is not correct? a. A machine bureaucracy is suitable for a stable, complex environment b. A professional bureaucracy is suitable for a stable, complex environment Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 15  c. An adhocracy is suitable for a dynamic, complex environment d. A simple structure is suitable for a dynamic, simple environment 4. Which statement on the matrix structure is not correct? a. It combines the advantages of a functional and a geographic structure b. It collides with the unity of command principle c. It is unusual in multinational firms d. It is unusual in startup firms 5. Which statement is correct? a. Adhocracies are most effective, because today’s environments are highly turbulent and complex b. Machine bureaucracies are outdated, because today’s environments are highly turbulent and complex c. Professional bureaucracies are outdated, because today’s environments are highly turbulent and complex d. None of the above statements are correct Answers 1d, 2a, 3a, 4c, 5d Mapping external influences (Chapter 3) & Structuring organisations (Chapter 11) 16  Lecture 16/10 Effectuating Strategies (chapter 9) Strategy: → How to accomplish a goal, to out-compete others, an integrated way of accomplishing one’s long-term goal Not operational (short term) but strategical (long term) Everyone on organisation should be on board with the goal (achieved through the mission statement) Must be internalised by everyone by explaining why it is important Strategy Diamond Arenas Target markets of activity which can be divided up in the following aspects Product arena: sub-sector of businesses Geographic arena: location of business activities Customer arena: targeted market segment Staging Staging evolution of strategic moves Certain sequences Certain speed of actions (not too fast not too slow / organic vs inorganic growth) Vehicles Internal and external resources to operate in arenas Internal capabilities: Distinctive own resources (employees) Barneys VRIN framework Lecture 16/10 Effectuating Strategies (chapter 9) 1  Valuable - assets that allow you to create wealth (professionalized workers) Rare - not everyone can have access to them Inimitable - should be hard to imitate Substitutable - cannot be replaced by another thing that is equally good External capabilities: Distinctive resources that can be accessed by outsiders Resource dependence theory (Preferce nce lancik talked about it?) Strategic alliance Franchising Mergers Joint venture Alliance (equity ( with own capital) vs non-equity (without own equity)) Differentiators How to stand out Porters generic strategy Cost leadership, differentiation, focus Treacy & Wiersma Operational excellence (out-competing by cheaper product), customer intimacy (a particular way of servicing customers that is more attractive), product leadership (more superior products) Economic logic Uniting all 4 other aspects of strategy diamond Underlying reasoning of how to accomplish the established goal Offers guidance and consistency for the other elements Lecture 16/10 Effectuating Strategies (chapter 9) 2  Everything should start with this as it is the why Strategy at different levels Corporate strategy Largest level at firm level How a large firm develops a portfolio of activities to accomplish its goals Scope and depth of business-unit activities Added value of parent how can we as a corporate to activities, achieving syneriergies Ansoff corporate strategy Product Existing New Market Market Existing New products penetration Market Conglomerate (not see as much) New development diversification (still seen a lot) Market share High Low Market growth High star question mark Low cash cow dog Business unit strategy The way in which a firm’s entity with a distinct domain of activities seeks to accomplish its goal Capability development Barneys VRIN framework Competitive positioning Lecture 16/10 Effectuating Strategies (chapter 9) 3  SWOT analysis Strength (internal capability) Weakness (internal capability) Opportunity (external influences) Threats (external influences) Ecosystem strategy Way in which a firm governs its relations with external factors to accomplish its goals Forms of external governance Ability and willingness to control external factors Vertical integration (with business in the chain before (integrate with the supplier as a producer) Horizontal integration Ability to control Market or non market actor (ability to transact) Relative dependence on power Willingness to controll Lecture 16/10 Effectuating Strategies (chapter 9) 4  Risk attitude Desire to grow organically (slow) or externally (fast) Strategy process Sequence of pacing and actions to accomplish an organisations goals (link to diamond) Strategic planning Systematic formulation and implementation of long-term actions (link to Denning and quality circle) 1. Goal establishment 2. SWOT analysis 3. Long term action formulation a. Top management will decide what to do and resource allocation 4. Long term action implementation 5. Outcome evaluation Strategic incrementalism (for unpredicted events, non linear) Shaping course of action, adjusted to unfolding events Initiate actions Observe events Experiment with adjusted actions Learn from past Remain flexible Strategic effectuating Establishing the most effective way to achieve an organisations goals for a given set of resources (making what you can of your recources, appropiate for smaller organisations with smaller capital) Chart available resources Lecture 16/10 Effectuating Strategies (chapter 9) 5  Determine acceptable risk and affordable loss Prioritise external collaboration over competition Adjust actions when new contingencies emerge Summary Effective strategies encompass and align all five components Strategies are everywhere, strategise at the right level Strategies need to be tailored to (changing) conditions Success as you effectuate your strategy! Question: 1. Which goal is not strategic? a. Acquiring a market share of 15% in belgium within 3 years b. Reducing employee turnover in South Africa by 5% within the next six months c. Being recognised as the most customer oriented firm in france in two years d. Launching two major new products on the market for elderly consumers in the next five years 2. Which statement is not correct? a. A corporate strategy is more important in a large business organisation than in a small one b. Business unit strategies may be very disimilar in a highly diversified firm c. An ecosystem strategy is less important in a fully vertically integrated firm than in a vertically integrated firm d. Business units never have an ecosystem strategy 3. Which statement is most correct? a. Economic logic concerns generating proditable activities Lecture 16/10 Effectuating Strategies (chapter 9) 6  b. Areas primary refer to geographic markets c. Vehicles are mostly about external resources to accomplish strategic goals d. Staging includes the sequence of strategic actions 4. Which statement is correct a. Strategic planning is most suitable for business environments with predictable rates of change b. Strategic incrementation excludes radical strategy adjustments c. Strategic effectuation refers to adjusting the requisite to the strategic goals set d. None of the above statements are correct 5. Which statement on the BCG matrix is correct? a. Question marks are further in the product life cycle than cash cows b. Cash cows are milked to finance dogs c. Stars have higher expected growth rate than question markets d. Dogs are likely to be discontinued Answers: 1b, 2d, 3d, 4a, 5d Lecture 16/10 Effectuating Strategies (chapter 9) 7  Lecture 6/11 Internationalization (chapter 4) International PESTLE: Political: Political opens turning into nationalism Economic: Neoliberalism turning into protectionism Social: Increasing (inequity related) social tensions The rich get richer, the poor get poorer Technological: Burst of IT-related innovations, selectively spreads Ecological: Local and global ecological boundaries crossed Running out of resources Legal Disrespect of private property right Countries are withdrawing from treaties Cage Framework/capturing international divergence To capture international differences (match firm environment) Cultural distance Lecture 6/11 Internationalization (chapter 4) 1  Administrative and political distance Geographic distance Economic distance To see if you can operate between two different cultures Internationalisation strategies Economic logic motives Cost saving International factor market differences (idea of arbitrage→the business goes where costs are the lowest) Labour costs Capital costs Natural resources costs Scale economies (scale up so unit costs go down) International specialization Logistics Lower transport costs Market access Serving foreign customers with similar needs Enhancing sales markets Serving global customers Selling to customers with operations in multiple countries Leveraging marketing skills Enhancing the reach of the sources of competitive advantage Competition Optimizing independent markets Lecture 6/11 Internationalization (chapter 4) 2  Coordinating activities to absorb international market fluctuations (go to the country where production for example is subsidised) Pre-empting or following main competitors Ensuring oligopolistic suppliers will not capture market first (coca cola followig pepsi) Government policies Trade discouragement Tariff and non-tariff (non qualitative requirements) barriers to trade (avoiding barriers) Location-specific practices National (technological) standards and (financial) controls FDI stimulations Create jobs Subsidies, tax benefits, infrastructure Capabilities Missing assets Acquisition of advanced technology and equipment (spring board strategy) Reputation Acquisition of existing brands Arenas Market access (where can I extend Cost saving (where can i sale activities) produce/sell most cheaply) Similarity to extend existing Arbitrage to minimise factor sales markets costs Following global customers Specialisation to optimise scale economies Lecture 6/11 Internationalization (chapter 4) 3  Similarity to leverage on Proximity to minimise logistic existing skills costs Government policies (which Competition (where is the most government gives most in order to unsaturated market in terms of attract you) demand) Local activities to align to local Regional market optimisation practices Pre-empting or following Foreign investments inside competitors protected markets Foreign investments to benefit from stimuli Vehicles Importing / exporting: Procuring from / selling to another country (Low risk, low return) Licensing (physical product) / franchising (service): selling a name, technology, or process for production / service abroad Joint venture: equity alliance abroad with a (local) partner →foreign direct investment Wholly owned subsidiary: affiliate abroad in full ownership (High risk, high return) Differentiators Lecture 6/11 Internationalization (chapter 4) 4  Liability of foreigners: Don’t know customer, don’t know regulations etc, disadvantage to company Must overcome liability of foreigners Must be larger than that Operational excellence Low-cost production Scale economies Organisational superiority Logistic superiority Customer intimacy Marketing superiority Global customer orientation (Local government orientation) Product leadership Technological superiority Design superiority Product quality superiority Staging Sequencing Exporting Sales subsidiaries Production subsidiaries Locally oriented, autonomous subsidiaries Globally specialised subsidiaries Speed Lecture 6/11 Internationalization (chapter 4) 5  Slow: greenfield expansion (organic growth) Fast: brownfield expansion (acquisition) One (relatively close) market at a time (cf. Uppsala model) Many markets simultaneously (cf. born-global firms) Organization structure Export/international divison Primarily functionally- or product-oriented structure Fairly central decision-making Predominantly domestic orientation Strength and weakness + Extension of procurement, production, and sales markets -Lack of international adaptation Multi-domestic structure Primarily geographic structure Highly decentral decision-making Strong differentiation Strength and weakness + High adaptability to local preferences -Inefficiency Transnational structure Primarily functionally- or product-oriented and geographic structure Central and decentral decision-making Standardisation and differentiation Strength and weakness Lecture 6/11 Internationalization (chapter 4) 6  + Scale economies and adaptation to local preferences -Tensions around central versus decentral decision-making and scale economies versus adaptation Questions: 1. Which statement on globalisation is most correct? a. The contemporary business environment is more globalised than a decade ago b. The contemporary business environment is less globalised than a decade ago c. The contempory business environment is as globalised as a decade ago d. The business environment was never globalised 2. Which economic logic is not a driver of internationalisation? a. Cost saving b. Market extension c. Cultural differences d. Government practices 3. Which statement on risks and returns is correct? a. Licensing entails higher returns and lower risks than a joint venture b. Exporting entails lower returns and higher risks than a wholly owned subsidiary c. A joint venture entails higher returns and lower risks than a wholly owned subsidiary d. A wholly owned subsidiary entails higher returns and higher risk than franchising 4. Which statement on the liability of foreigness is correct? Lecture 6/11 Internationalization (chapter 4) 7  a. The liability of foreigners stems from not knowing a host country as well as a home country b. The liability of foreigners stems from the need to borrow money to finance foreign expansion c. The liability of foreigners stems from facing international trade barriers d. None of the options are correct 5. Which international structure lends itself most to reaping scale economies? a. The domestic structure plus export b. The domestic structure plus international division c. The multi domestic structure d. The transnational structure Answers: 1b, 2c, 3d, 4a, 4d, 5d Lecture 6/11 Internationalization (chapter 4) 8  Lecture 29/10 Managing sustainably (Chapter 6) Meaning of sustainable business CSR: What is morally justifiable to do, ethics Business sustainability: How all ecosystems are interrelated to business activities Sustainable business: Professional activities accomplish economic viability and stakeholder satisfaction with planetary boundaries Viable: can’t do things where you only loose money Stakeholder satisfactions: social aspects Planetary boundaries: can’t go beyond boundaries Drivers of sustainable businesses Instrumental motive (Business case), to make more money Sales generation (new markets→making more sales, price premium→adding more money) Cost reduction (employee motivation, eco-efficiency→reducing consumption of eco resources but making the same amount of output), lower cost of capital (make business less risky so that shareholders invest more ) Risk reduction (less litigation risk→ensures long term continuity) Relational motive (social case) Aim to maintain good relations with internal and external stakeholders Maintaining legitimacy (also called license to operate) Doesn’t lead to more money but still done my companies Moral motive (the normative case) Sense of duty (deontology) Lecture 29/10 Managing sustainably (Chapter 6) 1  Higher order values Principles that you want to adhere to (to make a difference and create a better world) Legal motive (the coercive case) Regulatory compliance Avoidance of fines or closure Avoid creating externalities as it is illegal Connection to economies of scale (if in the EU red 40 can’t be used the company is more likely to not use it at all anymore even outside the EU) Engaging stakeholders Stakeholders: Powerful with urgent and legitimate interests Internal vs external Primary vs secondary (direct vs indirect business) Stakeholder salience (importance) is contingent on: type of organisation STEEPLE environment Issue salience (perceived relevance of a topic) How to engage stakeholders: Has to be voluntary, you cannot force stakeholders to engage with you 1. Explore common ground a. Search for shared interests b. You need to tailor your strategy to the interest of your stakeholder c. Chart costs and benefits d. Show how focal issue may impact legitimacy e. Relate focal issue to higher cause 2. Frame the issue Lecture 29/10 Managing sustainably (Chapter 6) 2  a. Formulate in appealing terms b. Suggest participation is opportunity or no threat c. Show impact of actions on stakeholder legitimacy d. Present participation as contribution to “better society” 3. Use soft power a. Use social skills to persuade b. Set the agenda in economic terms c. Create a coalition of “the willing” d. Use personal authority to show moral virtue 4. Creative incentive systems a. Redefine the pay-off game b. Offer material incentives to participate c. Ensure status or legitimacy gains for participants d. (no action needed to induce morally driven stakeholders) 5. Build capacity a. Offer requisite resources b. Transfer financial resources to “blockers c. Legitimate stakeholder behaviour d. Transfer resources to deprived actors Mainstreaming requires institutionalization Mainstreaming: Integrating sustainable business into core activities Institutionalisation: Accomplishing durable, widely adopted, taken or granted practices Institutionalisation process 1. Requires a trigger (you need to be activated) Lecture 29/10 Managing sustainably (Chapter 6) 3  a. Being sensitised to strong (external) pressure i. Accidental opportunity ii. Media scandal iii. Moral wake up iv. Legislation 2. Innovative practice a. Responding to trigger (only doing the bare minimum) i. Local and ad-hoc action ii. Satisfying specific stakeholder demands iii. Disconnected from core business 3. Theorisation a. Demonstrate relevance beyond initial action i. Economic opportunities ii. Corporate legitimacy iii. Corporate values iv. Similar regulation 4. Diffusion (formulate and communicate sustainable targets) a. Involve all business actors i. Regardless of hierarchical position ii. External and internal 5. Maintenance Link projects to core business Weave socioenvironmental acitivities into structure and culture Integrate socioenvironmental targets into KPIs Make new targets increasingly ambitious Questions: Lecture 29/10 Managing sustainably (Chapter 6) 4  1. Which statement on concepts is correct? a. Corporate (social) responsibility is more systematically oriented than corporate sustainability. b. Corporate sustainability is more normatively oriented than corporate social responsibility. c. The contemporary concept of shared value is more pertinent than the older concept of corporate sustainability. d. Concepts are less relevant as long as they reflect conducting business along three key dimensions 2. Which statement on sustainability drivers is NOT correct? a. Instrumental drivers of sustainable business are directly in line with the nature of business activities. b. Relational drivers of sustainable business reflect the desire to be perceived as legitimate c. Moral drivers of sustainable business reflect corporate responsiveness to NGO pressure. d. Legal drivers of sustainable business cannot be ignored in countries with well-developed law systems. 3. Which strategy is not appropriate for engaging stakeholders? a. Using soft power b. Using hard power c. Framing an issue d. Building capacity 4. Which statement on theorization is correct? a. Theorisation is about recognising the wider applicability of a specific action or event b. Theorisation is about relating actual business practices to relevant management theories Lecture 29/10 Managing sustainably (Chapter 6) 5  c. Theorisation is about systematically developing business strategies d. None of the above options are correct 5. Which action is not compatible with maintenance of sustainable business? a. Integrating sustainable activities into the job description of line managers b. Stimulating a mindset of developing new sustainable activities c. Examining the continued relevance of sustainable activities d. Tying employee remuneration to performance around sustainable activities Answers: 1d, 2c, 3b, 4a, 5c Lecture 29/10 Managing sustainably (Chapter 6) 6  Lecture 13/11 Managing ethically (Chapter 6) Business ethics Beliefs about what is right and wrong→general ethics about what is right or wrong applied to business and cultures Green fines: Fines that will be put into RND Cases Scandals can lead to bankruptcy, harms reputation Often caused by top management for self enrichment Often aggressive corporate culture of profit For business promotion Why do no whistleblowers exist Do ethical codes even help? Volkswagen had an ethical code Why? Greed, rational choice theory, weighing up risk vs win Strain theory: pressure for short-term performance Organisational culture: profits, bonuses are priorities, silence is reinforced Moral seduction theory: People are blinded and do not see evil People convince themselves they acted ethically, but they didn’t Business case: avoiding ethical scandals is in the company’s interest Lecture 13/11 Managing ethically (Chapter 6) 1  Applications Knows many applications Accounting Insider trading, executive compensation, facilitation payments, etc. Human resource management Discrimination, sexual harassment, privacy issues, slavery, safety, etc. Production Emission, tobacco, modified food, testing on animals, etc. Sales and marketing Skimming, price discrimination, sex in commercials, misleading commercials, defectuous/dangerous goods, etc. Ethical dilemma Lecture 13/11 Managing ethically (Chapter 6) 2  What is an ethical dilemma problem? There will always be disadvantages to a group 1. What are the alternative actions 2. Who are the stakeholders and their interests? 3. What are possible outcomes? 4. Discuss with your colleagues a. Look for devils advocates b. Resonate !!!!! Usually has many shades of grey Criteria for ethical decision making 1. Utilitarian approach (Jeremy Bentham & John Stuart) a. The solution which is the best for the most of people b. “The best for the most” 2. Moral rights approach 3. moral decisions are those that best maintains the rights of those affected (Immanuel Kant): a. The right of free consent b. People have a right to “know” c. The right of free speech d. The right of free conscience e. The right to life and safety f. The right to due process 4. Fairness/Justice Approach a. decisions must bebased on standards of equity, fairness, and impartiality Lecture 13/11 Managing ethically (Chapter 6) 3  b. Individuals who are similar in ways relevant to a decision should be treated equal (Aristotle) c. No discrimination, no favoritism!! d. A different treatment is possible, based on objective characteristics 5. Individualism approach a. acts are moral when they promote the individual’s best long-term interests i. Self direction is the highest good ii. Individualism does not equal egoism/immediate self-gain iii. Individualism is believed to lead to honesty and integrity as people learn to accommodate to each other in their long-term self-interest iv. Thus, individualism ultimately leads to behavior toward others that fits standards of behavior people want toward themselves. 6. The Common-Good Approach a. People are part of society and common goals and values must be served (Plato, Aristoteles, Cicero) b. For society to thrive, we need to safeguard the sustainability of our community for the good of all, including our weakest and most vulnerable members. i. Peace between nations ii. Public safety iii. No pollution Factors that determine ethical and unethical behavior 1. Individual stage of moral development a. Tested through the Heinz test b. The earlier your stage is the less moral you are c. Pre conventional i. Following rules in order to not get punished Lecture 13/11 Managing ethically (Chapter 6) 4  d. Conventional a. Following rules due to system e. Post conventional a. Following rules if you agree but if you dissagree not following them 2. Individual characteristics a. Values i. Basic convictions about what is right or wrong b. Personality a. Ego strength a. A personality measure of “the strength of a person’s convictions”, self discipline, persistence, taking accountability c. Locus of Control a. A personality attribute that measures the degree to which people believe they control their own life b. Internal locus: the belief that you control your destiny (tend to be more successful) c. External locus: the belief that what happens to you is due to chance 3. Structural and cultural variables a. Are the goals to be attained high? i. People who do not reach set goals are more likely to engage in unethical behavior (strain theory) b. Performance appraisal systems a. Outcome oriented? RESULTS !! b. Are ethical dimensions measured? c. Behavioral example of ethical conduct of managers d. Written codes of ethics Lecture 13/11 Managing ethically (Chapter 6) 5  e. Centralized org. structure promotes unethical behavior f. Corporate Governance 4. Organizational culture a. Is it an ethical culture? b. Is it a strong culture? 5. Intensity of ethical dilemma a. If the intensity of the ethical issue is high we are more likely to be ethical b. If its lower we tend to be less ethical 6. Moral seduction/decision making International organizations and ethics 1. The school of ethical universities a. Common understandings across multiple cultures and countries about what constitutes right and wrong give rise to universal ethical standards that apply to all societies, all firms, and all businesspeople i. Bad: May have different interpretations based of different cultures, ethical imperialism 2. The school of ethical relativism a. Differing beliefs, customs, and behavioral norms across countries and cultures give rise to multiple sets of standards of what is ethically right or wrong => always use local standards i. Bad: Shipbreaking 3. Integrated Social Contracts Theory a. The collective views of multiple societies form universal (first order) ethical principles, a social contract. Within the contract, cultures or groups can specify locally ethical (second-order) actions, only when more stringent. Lecture 13/11 Managing ethically (Chapter 6) 6  How managers can improve ethical behavior in organizations 1. Hire individuals with high ethical standards 2. Establish codes of ethics and decision rules a. Train them in it 3. Lead by example (ethical culture) 4. Set realistic job goals and include ethics in performance appraisal (systems and structures) (KPIs) 5. Provide ethics training 6. Conduct independent social audits 7. Provide support for individuals facing ethical dilemmas such as whistle blowers 8. Install proper corporate governance a. Is an internal system encompassing policies, processes and people, which serves especially the needs of shareholders, by directing and controlling (top)management activities with good business savvy, i. bjectivity, accountability and integrity. ii. Especially needs of shareholders are served by CONTROLLING management. iii. Today trend towards serving other stakeholders (employees, customers, community) => Social Corporate Governance iv. Agency theory v. Agency theory is concerned with resolving problems that can exist in agency relationships due to unaligned goals. The most common agency relationship occurs between shareholders (principal) and company executives (agents). =>in CG, especially needs of shareholders are served by CONTROLLING management (not only financial control - should also control ethical issues Lecture 13/11 Managing ethically (Chapter 6) 7  vi. Stewardship theory, Managers, left on their own, will act as responsible stewards of the assets they control =>Task of both board and management is establishing a good strategy vii. In strategy should be a combination of both viii. Personal advantage for company: 1. The perceived quality of a company's corporate governance can influence its share price 2. Reputation, trust in company (other investors, customers..) 3. Less uncalculated risks – more ethical decisions 4. If management has more than 20 % of the stock, they become greedy 5. But, when managers get stock, they are more engaged Questions: 1. Business ethics is about: a. Clear rules how one should behave ethically b. Biases that blind people from engaging in ethical behavior c. The theory that ethics should be tought starting at a young age d. Assumptions about what is good or wrong applied to business 2. Men and women should receive different ssalaries if they are performing the same job. This is an example of the….. approach in ethical decision making. a. Utilitarian b. Justice c. Individualism d. Common good 3. X company is listed on the stock exchange, however sales are not going well, Karen, the boockkeper decides to “reshuffle some papers”. What is the most important driver for unethical behaviour? Lecture 13/11 Managing ethically (Chapter 6) 8  a. The macho/macha effect b. Strain c. An organisational culture of up or out d. Rational choice 4. Many companies argue monitoring how employees surf on the internet is necessary. If employees are viewing pornographic sites the entire organisation will suffer. This is a …. approach in ethical decision making. a. Individualis b. Justice c. Common good d. Utiliarian 5. What could be said about a manager who does not achieve her/his goals and blames back external circumstances? a. He has an internal focus of control b. He has a high ego strengh c. He has a low ego strength d. He has an external locus of control 6. Pluto maintained an annual budget of 50 million for paying bribes. The headline in Fortune was “bribery was just a line item, the companies business model”. What is the most important driver of unethical behavior? a. Organisational culture b. Moral seduction c. Strain d. Rational choice 7. The board of directors of ABF are considering building a new power plant. One of the directors suggests building a brown coals plant, which is polluting but cheap. This approach is called: a. Social accounting view Lecture 13/11 Managing ethically (Chapter 6) 9  b. Classical view c. Legal view d. Socio-economic view Answers: 1d, 2b, 3b, 4d, 5d, 6a, 7b Lecture 13/11 Managing ethically (Chapter 6) 10  Lecture 20/11 (Managing an organization’s culture)(Chapter 3) Important note: NOT TO STUDY: Manager: omnipotent or symbolic? TO STUDY: Organizational culture: constraints and challenger Environment The environment Previous work culture gave companies the advantage of lower costs (9-5 only working) Flexi desk work: gets rid of habits of people, which causes conflict but was aimed to increase team spirit Internal environment (culture) Organizational culture is not the missing link!!! Definitions: 1. The way things get done around here 2. The shared values, principles, traditions and ways of doing things influence the way organizational members act and distinguish the organization from other organizations. → unwritten code of conduct 3. A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 1  the correct way to perceive, think, and feel (and act) in relation to those problems and function as the glue that holds the organization together Analysing an organization's culture The seven dimensions: 1. Is it outcome-oriented or not? 2. Are they people-oriented or not? 3. High or low team orientation? 4. Agressive and competetive? 5. Do they want to maintain the status quota or innovate? 6. Do they innovate and take risk or not? 7. Do they pay high or low attention to detail? Schein's model of organizational culture (the onion model): Has a cultural gap between the different levels 1. Artifacts a. Can be seen by an outsider and will reveal something about the culture b. Slogans, materials, clothing, buildings, symbols, stories and myths, practices, 2. Norms and values a. It can only be seen by insiders b. Espoused is what management wants, what is seen on the websites c. Enacted what the real values are and how they are executed 3. Basic assumptions a. Even people working for the company won’t know b. Theory X view: employees are lazy people which can’t be motivated which don’t want autonomy Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 2  c. Theory Y view: People need to be empowered, they want responsibility and authority and want to work Organisations do not have uniform cultures; they frequently have varying sub cultures depending on the department, and the management level Importance of organisational cultures Unwritten Code of conduct A culture acts as formalization, be it unwritten and is sometimes stronger than written procedures/rules Acts as a control mechanism Defines boundaries Conveys a sense of identity, commitment Person-organization fit You need to fit into the culture of the company otherwise you may not be happy Following examples do not need to be known by heart: Planning is affected by culture Organizing is affected by culture Leadership is affected by culture Controlling is affected by culture Enhances social stability (social glue) Sense of direction of decisions* and Sense making Influences management style/how people deal with each other Link between culture and performance Adaptive culture will lead to success according to Harvard professor but KUL professor disagrees with that BUT fit is important and can affect success: Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 3  Fit between culture and the environment Fit between culture and strategy Fit between culture and what a company is doing Strong (vs. weak) cultures Strong culture: the organization’s core values are both intensely held and widely shared Have great influence on the behavior of its members Increase cohesiveness Acts like formalization Especially in not formal formalized cies Result in lower employee turnover and better performance ? Factors Influencing the strength of culture Size of the organization Small have strong Age of the organization Old have strong Rate of employee turnover Low rate has strong Strength of the original culture Clarity of cultural values and beliefs Not many subcultures Strong cultures are not always good: can act as a barrier to change can act as a barrier to diversity can act as a barrier to acquisitions and mergers Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 4  Typologies of culture Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 5  How are cultures created and sustained? Creating a Culture Ultimate source of an organization’s culture is its founders They have a clear vision They are unconstrained by previous visions They hire and keep employees who think like them Founders act as role model When successful, the founder’s vision becomes a “myth” Also, industry and national culture plays a role Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 6  Keeping a Culture Alive Selecting and hiring those who fit in Socialization Informal Via stories, rituals convey what is important or not Language/jargon Symbols “Peer pressure” Formal: training, espoused values Performance evaluation, rewards Managers as role models Structure Changing a culture Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 7  Culture is not easy to change Especially a strong culture Factors that might “ease” changing a culture Dramatic crisis Turn over in leadership Young and small organizations Weak culture What? the star model! (setting up your change strategy) Playing with elements of formal and informal socialization The process: Change management The star model: Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 8  Innovative culture STAR MODEL and emphasis on: Give people Freedom Install an inspiring vision of innovation Trust and openness Idea time (e.g. Googlettes) Playfulness/humor Debates, expression of opinions Conflict resolution procedures Diversity Allow and reward Risk-taking Accept failure Customer responsive culture STAR MODEL and emphasis on: Hiring the right type of employees Having good listening skills in relating to customers’ messages Having few rigid rules, procedures, and regulations Providing role clarity to employees to reduce ambiguity and conflict and increase job satisfaction Using widespread empowerment of employees Ethical culture STAR MODEL and emphasis on: Formal socialization Communication of ethical vision and values Ethical training - ethical codes Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 9  Informal socialization Top managers must be role models of ethical behavior Stories, myths, peer pressure… Performance appraisals and rewards for ethical conduct Not too high bonuses and expectations Encourage whistle blowers Structure: Proper control systems and good working Corporate Governance (board of directors) (esp. in a centralized structure) Intercultural differences (Global management) A national culture influences how people behave and has a big influence on organizational culture of the local firm It is about: Values, religion, ethics, gender issues, communication, food, habits etc. Important for multinational companies! E.g.: communication style, eye contact Ethnocentrism The belief that one’s native country, culture, language and habits are superior to all others Hofstede’s 5 dimensions of national culture Indivisualism: everyone takes care of Collectivism: people look after each other themselves Long term orientation: people prioritize Short term: People value tradition and the high savings, the future and persistence past High power distance: authority and higher Low power distance: being the boss isn’t ups are highly respected special, more of a casual relationship High uncertain avoidance: increases Low uncertain avoidance: risk is good, anxiety different behavior is tolerated Lecture 20/11 (Managing an organization’s culture)(Chapter 3) 10  Achievement (masculine): values money, Nurturing (feminine): values relationships and competition, and assertivness people are concerned for other poeple Globe studies Used to analyse national culture not to analyse organisation cultures High context vs. low context national culture High context culture Low context culture Establish social trust first Go down to business first Value personal relations and goodwill (who you Value expertise and performance know not what you know) (diploma counts) Agreement by general text Agreement by legal contract Negotiations: slow and ritualistic Negotiations: as efficient as possible Monochromic time (only doing one Polychromic time (doing everything together) thing at a time) Intimate personal space (distance held in a Personal/ social space business kind of relationship)