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8/14/2019 INTRODUCTION TO MANAGEMENT.doc
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INTRODUCTION TO MANAGEMENT
Organizations pervade every aspect of our lives. Organizations seem to be everywhere.
We are born in organizations, educated by organizations, and most of us spend much ofour lives working for organizations. ... Most of us will die in an organization, and when the
time comes for burial, the largest organization of all - the state - must grant official
permission (Amitai Etzioni).
Organizations come in a variety of sizes and types - corporations, schools, governments, and
so on, - and they serve a wide range functions. Related to this, all organizations try to reach
their common goals. It would be impossible to image a modern society without organized
effort or without people who oversee and synchronize that effort. The purpose of this thesis is
to promote excellence of all persons in organizations, but especially managers.
This introductory chapter lays put the general dimensions of the managers !ob. It introducesthe role and the function of managers in the organization, identifies re"uisite management
s#ills, and examines the historical development of management #nowledge.
Defining Management
�The field of management deals with organizations. Our society could not exist or improve
its present status without managers to guide it organizations. Thirty years ago, $eter %ruc#er,
a noted management authority, proclaimed that effective management was becoming the main
resource of developed nations, and that it was the most needed resource of developing
nations.�%ruc#ers comments are still valid and all countries need good managers.
This section offers an explanation of the general terms and principles of organization and
management.
n most &large' corporations there are several levels of strategy. (trategic management is the
highest in the sense that it is the broadest, applying to all parts of the firm. It gives direction to
corporate values, corporate culture, corporate goals, and corporate missions. )nder this broadcorporate strategy there are often functional or business unit strategies.
Functional strategies include mar#eting strategies, new product development strategies,
human resource strategies, financial strategies, legal strategies, supply-chain strategies, and
information technology management strategies. The emphasis is on short and medium term
plans and is limited to the domain of each department*s functional responsibility. +ach
functional department attempts to do its part in meeting overall corporate ob!ectives, and
hence to some extent their strategies are derived from broader corporate strategies.
any companies feel that a functional organizational structure is not an efficient way to
organize activities so they have reengineered according to processes or strategic businessunits &called ()s'. strategic business unit is a semi-autonomous unit within an
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organization. It is usually responsible for its own budgeting, new product decisions, hiring
decisions, and price setting. n () is treated as an internal profit centre by corporate
head"uarters. +ach () is responsible for developing its business strategies, strategies that
must be in tune with broader corporate strategies.
The “lowest” level o strateg! is o"erational strateg!. It is very narrow in focus and dealswith day-to-day operational activities such as scheduling criteria. It must operate within a
budget but is not at liberty to ad!ust or create that budget. Operational level strategy was
encouraged by $eter %ruc#er in his theory of management by ob!ectives &O'. Operational
level strategies are informed by business level strategies which, in turn, are informed by
corporate level strategies. usiness strategy, which refers to the aggregated operational
strategies of single business firm or that of an () in a diversified corporation refers to the
way in which a firm competes in its chosen arenas.
Cor"orate strateg!# then, refers to the overarching strategy of the diversified firm. (uch
corporate strategy answers the "uestions of /in which businesses should we compete0/ and
/how does being in one business add to the competitive advantage of another portfolio firm,as well as the competitive advantage of the corporation as a whole0/
(ince the turn of the millennium, there has been a tendency in some firms to revert to a
simpler strategic structure. This is being driven by information technology. It is felt that
#nowledge anagement systems should be used to share information and create common
goals. (trategic divisions are thought to hamper this process. ost recently, this notion of
strategy has been captured under the rubric of dynamic strategy, popularized by the strategic
management textboo# authored by 1arpenter and (anders. This wor# builds on that of rown
and +isenhart as well as 1hristensen and portrays firm strategy, both business and corporate,
as necessarily embracing ongoing strategic change, and the seamless integration of strategy
formulation and implementation. (uch change and implementation are usually built into the
strategy through the staging and pacing facets.
2hat is strategic management0(trategic anagement can be defined as 3the art and science of formulating, implementing
and evaluating cross-functional decisions that enable an organization to achieve its ob!ective.4
%efinition53The on-going process of formulating, implementing and controlling broad plans guide theorganizational in achieving the strategic goods given its internal and external
environment4.
Interpretation56. On-going process5
(trategic management is a on-going process which is in existence through out the life of
organization.
7. (haping broad plans5
8irst, it is an on-going process in which broad plans are firstly formulated than implementing
and finally controlled.
9. (trategic goals5
(trategic goals are those which are set by top management. The broad plans are made in
achieving the goals.
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:. Internal and external environment5
Internal and external environment generally set the goals. (imply external environment forced
internalenvironment to set the goals and guide them that how to achieve the goals
The strategic-management process does into end when the firm decides whatstrategy or strategies to pursue. There is a translation of strategic though intostrategic action. This translations much easier if managers and employees of thefirm understand the business, feel a part of the company, and throughinvolvement in strategy-formulation activities have become committed to helpingthe organization succeed. Withoutunderstanding and commitment, strategy-implementation efforts face majorproblems.
Implementing strategy affects an organization from top to bottom it affects allthe functional and divisional areas of a business. It is beyond the purpose andscope of this te!t to e!amine all of the business administration concepts andtools important in strategy implementation. This series of post focuses onmanagement issues most central to implementing strategies in the year "#$#,and upcoming posts focuses on mar%eting, finance&accounting, '(), andmanagement information system issues.
The strategy-implementation stage of strategic management is revealed.*uccessful strategy formulation does not guarantee successful strategy
implementation. It is always more difficult to do something +*trategyimplementation than to say you are going to do it +strategy formulationlthough ine!tricably lin%ed, strategy implementation is fundamentally differentfrom strategy formulation. *trategy formulation and implementation can becontrasted in the following waysWays of *trategy /ormulation and Implementation
$. *trategy formulation is positioning forces before the action.". *trategy implementation is managing forces during the action.0. *trategy formulation focuses on effectiveness.
1. *trategy implementation focuses on efficiency.2. *trategy formulation is primarily an intellectual process.3. *trategy implementation is primarily an operational process.4. *trategy formulation re5uires good intuitive and analytical s%ills.6. *trategy implementation re5uires special motivation and leadership s%ills.7. *trategy formulation re5uires coordination among a few individuals.$#. *trategy implementation re5uires coordination among many individuals.
*trategy-formulation concepts and tools do into differ greatly for small, large, for-profit, or nonprofit organization. 8owever, strategy implementation varies
substantially among different types and sizes of organizations. Implementingstrategies re5uires such actions as altering sales territories, adding new
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departments, closing facilities, hiring new employees, changing an organization9spricing strategy, developing financial budgets, developing new employee benefit,establishing cost-control procedures, changing advertising strategies, buildingnew facilities, training new employees, transferring managers among divisions,and building a better management information system. Theses types of activities
obviously differ greatly between manufacturing, service, and governmentalorganizations.