Chapter 7 Notes

nuthookcanteenManagement

Nov 20, 2013 (3 years and 11 months ago)

138 views


Page
1


Chapter
7

-

-
Business Management

Section 1:
Management Functions

Introduction to
Management

Entrepreneurs who start and run businesses by themselves do not have to manage other people. They have to manage themselves.

However, if the
firm has employees,

then some ty
pe of management plan is necessary.


Management

includes the processes or functions of planning, organizing, leading and controlling.


Managers help a business by:



supervising

and
directing

employees



focus on
setting and meeting goals

effici
ently and effectively so profits can be made



having a
thorough understanding

of business operations



develop objectives

for a firm or a department and then figure out how to meet those objectives through people,
work processes and equipment

The Four
Functi
ons of
Management

Most managers carry out four different functions of management. These functions are indicated in the order in which they occ
ur:
planning, organizing, leading and controlling.



Planning
: The act or process of creating goals and
objectives as well as the strategies to meet them. Planning also involves
figuring out the resources that are needed and the standards that must be met.



Organizing
: Is getting the resources arranged in an orderly and functional way to accomplish goals
and objectives. A
manager must:



organize people, work processes and equipment

so that the work is well coordinated.



hire and train employees



and fire them when necessary.



make sure
employees have all the tools

they need to do their jobs well.


Leading
:
Providing direction and vision. Good management must create a vision of the company to inspire their employees.
Standards for deadlines and sales quotas must be set so managers and workers know their goals. Leaders also must:



delegate

work



enf
orce

policies


Page
2




oversee

time management



Provide

feedback

on employees’ work.



resolve conflicts

between workers



Controlling
: keeping the company on track and making sure goals are met. Managers must:



keep track

of the budget



the
schedule



the
quality o
f the pr
oducts or services

they provide



monitor

their employees and
review

their performance according to standards



take corrective action

when goals are not met



monitor customer satisfaction



Levels of
Management

Another important part of organizing is determining how different individuals in the firm relate to one another. An
O
rganizational
C
hart

shows how the firm is structured and who is in charge of whom.




Top
-
level M
anager



牥獰on獩s汥⁦o爠獥st楮g⁧ 慬猠慮
d⁰污nn楮g⁦ 爠th攠晵瑵牥⁡t⁷敬氠慳敡摩ng⁡湤⁣on瑲o汬楮g
瑨攠to牫f瑨敲献†Sm慬a bu獩s敳獥猠m慹nly⁨慶攠on攠top
-
汥v敬em慮慧敲

bu琠楮慲 敲e晩fm猬⁴op
-
汥v敬em慮慧敭敮琠捡c⁢
捯mpos敤f⁡ 捨c敦ee硥捵c楶i o晦fc敲e⡃(伩Ⱐa⁰牥獩 en琬t慮d⁡ 敡獴 o
ne⁶楣攠pr敳楤敮琮




Middle Manager



捡牲c敳u琠瑨t⁤散楳 on猠s映瑯p m慮慧em敮琮†M楤d汥慮慧e牳⁡牥f瑥n⁲敳pon獩s汥⁦o爠
v慲aous⁤数 牴m敮e猠楮⁡⁢u獩s敳猠獵捨⁡ ⁴h攠produ捴楯nⰠm慲步瑩tg⁡湤⁡捣ount楮g⁤数 牴r敮琮†M楤d汥lm慮慧敭敮琠楳i
牥獰rn獩s汥⁦o
爠瑨攠o牧慮楺楮g⁦畮捴楯n⁡猠睥汬 慳⁴he敡摩ng⁡湤⁣on瑲o汬楮g⁷or欠of瑨敲献t




Operational Manager



r敳灯n獩sl攠fo爠瑨攠摡楬y op敲e瑩tnsf⁡ bu獩s敳献†卵p敲v楳ir猬so晦f捥 m慮慧敲猬⁡湤
捲敷敡摥牳⁡牥 瑹p敳fp敲慴楯n慬am慮慧敲献†sh敹⁡汳 ⁤o⁳om攠p污ln楮g⁡湤牧慮楺楮gⰠ桯w敶敲Ⱐ瑨敩爠m慩a⁤ 瑩敳
楮捬cd攠ov敲e敥楮g⁷o牫敲e⁡湤e整楮g⁤敡摬楮e
猠s汥慤楮g⁡湤⁣on瑲o汬楮g⤮


Page
3



Chapter
7

-

-
Business Management

Section
2: Management Structures

Managerial
Structures

There are several ways to organize a management structure.



Line Authority
: an organizational structure in which managers on one level are in charge of those beneath them. An
advantage

of the line authority structure is that
authority is clearly defined
. Each employee knows to whom
she or he reports. A
disadvantage

is that t
he mangers
have few specialists

who help with their responsibilities.



Line and Staff Authority
: organizational chart shows the direct line of authority (indicated by solid lines) as well as
staff who advise the line personnel (indicated by dotted line
s). An
advantage

is that managers
can see who they
can get advice from
. A
disadvantage

is that it
can lead to overstaffing
, which can be costly.



Centralized organization
: puts authority in one place


with top management. This helps managers throug
hout
the firm to be consistent in decision making.



Decentralized organization
: gives authority to a number of different managers. They are often evident in
international business. Some U.S. managers working in foreign countries have more decision
-
ma
king power because they know their
markets well.


Formal Structures

are usually departmentalized.



Departmentalization

divides responsibility among specific units or department. Departments can be organized
many different ways, such as:

o

by geographical
location

o

function

o

customer groups

o

product


Page
4



Informal Structure
.
Smaller
businesses can be run informally. If a business does not need a big marketing or distribution
network, it does not need a lot of managers. Employees can be more flexible and share duties.

Is a Manager’s Job
for You?

Most managers
begin their career in

an entry
-

level job. An
entry
-
level job

is a beginner
-
level position. New employees who
gain experience and show certain qualities can be promoted to higher positions, including management.


Skills Needed by Managers:



Be
t
ask oriented



瑨t猠m敡湳e瑨敹⁣慮⁨慮dl攠m慮y⁴慳歳aa琠瑨攠獡me⁴im攮e



Work under pressure and solve many small problems
.



Communicate well.

This involves listening as an important part of communication.



Have human relations skills



獫楬ss d敡汩eg⁷楴i⁰ op汥⸠l



Ha
ve knowledge of the technical aspects

of their business.


Advantages of Being a Manager:



Earn more money

than employees in non
-
management jobs.



Managers who are good leaders
are respected

which builds prestige.



Have more
influence and authority

than other
employees because they plan, organize, direct and control
company resources.



Have
greater control over their time
.


Disadvantages of Being a Manager:



Managers are
often blamed

when things go wrong, even if they did not cause the problem.



Mistakes can be ve
ry costly to the company, so they are
under a lot of pressure

to make the right decisions.