Chapter 3: The Changing Environment of ManagementMGT 210
Section17&18
Managerial Environment
Social Environment Political-Legal Environment Economic Environment Technological Environment
Social Environment
Constant struggle between the forces of stability x Change = Society.
Basic Characteristics of social environment: Keeps on changing. Very dynamic Constant struggle
Dimensions of social environment 4 important dimensions of social
environment: Demographics of the New Workforce New Social Contract Between Employer and
Employee. Nagging Inequalities in the Workplace. Managing Diversity
Demographics of the New Workplace New Changes:
Workforce is getting larger. Increasing work opportunity for females. Racial and ethnical diversity is increasing. Workforce is getting older.
Demographics of the New Workplace(Cont.) Myths About Older Workers
Are less productive. Incur higher benefits costs. Have higher absenteeism. Tend to have more accidents at work. Are less willing to learn. Are inflexible about the hours they are willing to
work.
New Social Contract Between Employer and employee New Social Contract
Old idea of lifetime employment with one employer has gone.
Assumption that employer-employee relationship will be a shorter-term one based on convenience and mutual benefit, rather than for life. Employees are expected to manage their own careers to
increase their long-term value. Employers are expected to provide the necessary
means for continual workforce development .
Nagging Inequalities in the Workplace Under the Glass Ceiling
The transparent but strong barrier keeping women and minorities from moving up the management ladder.
Women are demanding more equitable compensation and workplace opportunities.
Nagging Inequalities in the Workplace Continuing Pressure for
Equal Opportunity Women, minorities, and
the physically challenged are all expected to press harder for more employment opportunities.
Managing Diversity
Managing Diversity The process of creating an organizational culture
that provides all employees; including women and minorities, with assistance and opportunities to help them realize their full potential.
More than EEO The moral necessity and commitment in going
beyond EEO and affirmative action to create flexible organizations that encompass and value diversity. Example- understanding different employees from different perspective.
The Political-Legal Environment The Politicization of Management
Issues management Ongoing process of identifying, evaluating, and responding to
important social and political issues. Purposes: minimize “surprises” and make more systematic
and effective responses to issues.
The Political-Legal Environment The Politicization of Management
Issues management Ongoing process of identifying, evaluating, and responding to
important social and political issues. Purposes: minimize “surprises” and make more systematic
and effective responses to issues. General political responses
Reactive Approach Neutral Approach Proactive Approach
Management’s Political Response Continuum
The Political-Legal Environment Specific Political Strategies
Campaign financing Financing preferred political campaigns or individual
candidates. Lobbying
Most popular and successful strategy. Includes formal presentations between managers and
legislators. Coalition building
Building coalition with special interest groups. Indirect lobbying
Advocacy advertising: Promoting a point of view along with a product or service which is appreciated by the legislators.
The Economic Environment
Management and economy is closely related. Three aspects of economic environment of
management: Jobs Business Cycle Global Economy
The Economic Environment
Jobs Education is essential in getting a highly paid job. Top 20 highly paid occupations require at least a widely
recognized bachelor degree. Business Cycle
The up and down movement of an economy’s ability to generate wealth.
Business cycles are converging worldwide.
The Economic Environment
Cycle-sensitive decisions Timed decision about appropriate responses to
changes in the business cycle is necessary for:
reducing the chances that a firm’s assets and resources will be underutilized or wasted in economic downturns.
taking advantage of opportunities that will arise during periods of rapid expansion of the economy.
Business Cycles Affect Managerial Decisions
The Technological Environment Technology
All the tools and ideas available for extending the natural and mental reach of humankind.
Technology is facilitating the evolution of the information age.
Information has become a valuable strategic resource for gaining competitive advantage.
The Technological Environment The Innovation Process
The systematic and practical application of a new idea.
Steps in the Innovation Process Conceptualization: when a new idea occurs to
someone. Product technology: creation of a working
prototype. Production technology: development of a
profitable production process.
The Three-Step Innovation Process
Innovation Lag The time it takes for a new product to be translated
into satisfied demand. Shortening Innovation Lag
Goal setting: creating a sense of urgency and purpose.
Empowerment: pushing decision-making authority down to the level of the decision.
Concurrent engineering: using a team approach to product design involving specialists from all functional areas including research, production, and marketing.
The Technological Environment
Promoting Innovation Through Intrapreneurship
Intrapreneur An employee who takes personal responsibility for
pushing an innovative idea through a large organization. example: Rahimafrooz.
Fostering Intrapreneurship Focus on results of teamwork. Reward innovation and risk taking. Tolerate and learn mistakes. Remain flexible and change-oriented.
Thank You All!
Recommended