Principles Of Management BBA 1564 PDF

ninth edition BBA 1564 STEPHEN P. ROBBINS MARY COULTER PRINCIPLES OF MANAGEMENT 1PowerPoint Presentation by Charlie Cook The University of West Alabama BBA 1564...

ninth edition BBA 1564 STEPHEN P. ROBBINS MARY COULTER PRINCIPLES OF MANAGEMENT 1PowerPoint Presentation by Charlie Cook The University of West Alabama BBA 1564 ninth edition STEPHEN P. ROBBINS MARY COULTER Organizing TOPIC 4 PowerPoint Presentation by Charlie Cook The University of West Alabama Chapter 4: Organizing Learning Outcomes Successful students will be able to:  Define organizing and explain the organizing process.  Describe the types of authority and power.  Explain delegation, span of control, centralization and decentralization. MGT104 3 Organizing Organizing is the management function that establishes relationship between activity and authority. MGT104 4 Organizing… Chain of Command The continuous line of authority that extends from upper levels of an organization to the lowest levels of the organization and clarifies who reports to who. MGT104 5 Benefits of Organizing 1. Clarifies the work environment 2. Creates a coordinated environment 3. Achieves the principles of unity of direction 4. Establish the chain of command 2005V1.0 MGT104 6 Benefits of Organizing 1. Clarifies the work environment  Everyone understands what to do as the tasks and responsibilities of individuals and departments are clear.  The authority of each individual and department will also be determined. MGT104 7 Benefits of Organizing (cont’d) 2. Creates a coordinated environment  It defines the interrelationships of work units and establish guidelines for interaction among personnel. MGT104 8 Benefits of Organizing (cont’d) 3. Achieves the principles of unity of direction  Organizing, establishes the one authority figure for each designated task of the organization.  Each organization unit should have a single objective linked to organizational goals. MGT104 9 Benefits of Organizing (cont’d) 4. Establish the chain of command  Chain of command – the unbroken line of reporting relationship from the bottom to the top of the organization.  It provides the orderly line for reporting from one hierarchy to another. MGT104 10 “The Practice of Management” (Peter Drucker) The Structure of Management  Based on Activity analysis Woman’s dress industry, no engineering needed but perhaps design. Pulp industry – land forest management important. Telecommunications – raising capital. Electric bulb manufacturers – growth depends on increased usage not increased customers. Decision analysis( which level?) Sourcing copper material ( should be a low level decision). Deciding what inventory policy?( policy reserved for higher management). Suspending employee for breach of contract( middle level decision). Relations analysis Downward relationship or vertical relationship. MGT104 11 “The Practice of Management” (Peter Drucker) Building the structure:  business performance purpose.  least possible levels of management levels.  training and testing of tomorrow’s top managers. Peter Drucker’s other books:  The End of Economic Man ( 1939).  The Age of Discontinuity.  The New Realities ( 1989).  Post Capitalist Society ( 1993). MGT104 12 5 Steps Organizing Process Step 1: Reviewing plans and goals/ objectives. Step 2: Determining work activities. Step 3: Classifying and grouping activities. Step 4: Assigning work and delegating authority. Step 5: Designing a hierarchy of relationships. 2005V1.0 MGT104 13 5 Steps Organizing Process Step 1: Reviewing plans and goals/objectives Review the plans and goals because plans change and new goals are developed. MGT104 14 5 Steps Organizing Process (cont’d) Step 2: Determining work activities Identify the work activities (on-going or unique) which is needed to achieve the goals/objectives. MGT104 15 5 Steps Organizing Process (cont’d) Step 3: Classifying and grouping activities Classify and group the activities into manageable work units or identifiable groups of like activities such as marketing, production, human resources and finance. MGT104 16 5 Steps Organizing Process (cont’d) Step 4: Assigning work and delegating authority Managers assign these activities to capable individuals and give them the authority to carry out the job / task. MGT104 17 5 Steps Organizing Process (cont’d) Step 5: Designing a hierarchy of relationships Manager have to determine the vertical and horizontal operating relationships of the organization. MGT104 18 Departmentalization by Type Functional Process  Grouping jobs by Grouping jobs on functions performed. the basis of Product product or  Grouping jobs by customer flow. product line. Customer Geographical Grouping jobs by  Grouping jobs on the basis of territory or type of customer geography. and needs. MGT104 19 Functional Departmentalization Advantages Efficiencies from putting together similar specialties and people with common skills, knowledge, and orientations. Coordination within functional area. In-depth specialization. Disadvantages Poor communication across functional areas. Limited view of organizational goals. MGT104 20 Organization Structure Authority The rights inherent in a managerial position to tell people what to do and to expect them to do it. Responsibility The obligation or expectation to perform. Power  An individual’s capacity to influence decisions. MGT104 21 Authority Definition: Authority is the formal and legitimate right of a manager to make decisions, give orders and allocate resources. MGT104 22 Types of Authority 1. Line authority The relationship between superior and subordinate where authority flows directly from superior to subordinate which allows the manager to give direct orders, evaluate their actions and reward or punish them. MGT104 23 Types of Authority (cont’d) 2. Staff authority / Advisory authority  The authority to serve in an advisory capacity - to provide advise and assistance to the higher level managers.  It flows upward to the decision maker. MGT104 24 Types of Authority (cont’d) 3. Functional authority  The authority that permits managers to make decisions about specific activities performed by employees within their departments.  Manager use functional authority to control their procedures in their departments. MGT104 25 Power The ability to exert influence on others in the organization. Authority is positional – when the manager leaves, authority will still be there. Power may be personal, it depends on the person. MGT104 26 Types of Power 1. Legitimate or position power 2. Reward power 3. Coercive power 4. Referent power 5. Expert power MGT104 27 Types of Power (cont’d) 1. Legitimate or position power (Authority)  The power that comes with the position.  The higher the hierarchy, the greater the power. MGT104 28 Types of Power (cont’d) 2. Reward power (Money/Benefit)  The power that comes from the ability to promise or grant rewards.  The manager is able to influence others because he controls the valued rewards. eg: manager can decide on promotion, increment, performance appraisals. MGT104 29 Types of Power (cont’d) 3. Coercive power (Punishment)  The power that comes from the ability to punish such as assigning unpleasant or boring work, withholding pay increment and promotions, suspending and terminating employees. MGT104 30 Types of Power (cont’d) 4. Referent power (Personality)  The power that is based on the kind of personality or charisma an individual has and how others perceive it.  People comply because the manager has personal characteristics that appeal to others. MGT104 31 Types of Power (cont’d) 5. Expert power (Knowledge)  The person has power because of his abilities, skills, knowledge, experiences, expertise.  People comply to the manager because they believe in the expert and would like to learn from them. MGT104 32 Past Year Question Explain FIVE (5) types of power, with appropriate examples, to describe circumstances of how and when managers would apply the power types. MGT104 33 Delegation The downward transfer of formal authority from one person to another to carry out specific activities. However, manager still has the ultimate responsibility for the overall performance or accomplishment of the task. MGT104 34 Steps in Delegating ( delegating process) 1. Decide which tasks can be delegated a) Many items can and should be delegated. b) Some are minor decisions/routine chores. c) But demanding and challenging assignments will do much to develop subordinates. 2. Decide who should get the assignment a) Who has available time? b) Does the job require special competence? c) For whom is it appropriate and developmental experience? 3. Delegate the assignment a) Delegate the results expected. 4. Establish a feedback system a) So you can remain advised MGT104 of the progress. 35 Sherman’s 6 degrees of delegation (feedback) 1. Take action – no further contact with me is needed. 2. Take action – let me know what you did. 3. Look into the problem – let me know what you intend to do, do it unless I say not to. 4. Look into this problem - let me know what you intend to do, delay action until I give the approval. 5. Look into this problem - let me know alternative solutions available with pros and cons and recommend one for my approval. 6. Look into this problem –give me all the facts ; I will decide what to do. Source : “A pragmatic approach to organizations “, University of Alabama(1966), Harvey Sherman. MGT104 36 Advantages of Delegation 1. To reduce the burden and stress of the top managers due to physical and mental limitations. 2. Routine work should be delegated so that top managers have more time to do planning. MGT104 37 Advantages of Delegation (cont’d) 3. Delegation is a way of training and motivating subordinates. 4. There is a need for specialization and division of work. MGT104 38 Barriers to Effective Delegation 1. People like to have power and many managers think that they are giving up power and control when they delegate. 2. Feeling of fear where managers are afraid that the subordinates may perform better and earn a good reputation. MGT104 39 Barriers to Effective Delegation (cont’d) 3. Managers lack of trust in subordinates because some subordinates may be new or inexperienced. 4. Lack of information because some information are confidential and can only be accessed by top managers. MGT104 Barriers to Effective Delegation (cont’d) 5. Some managers have poor communication skills and are shy to communicate with subordinates, so they rather not delegate. 6. Subordinates negative attitude towards delegation and they perceive delegated task are extra burden rather than for personal and career growth and development. MGT104 41