Chapter 5 – Managing the Business

Manager
Someone whose primary responsibility is to carry out the management process.
Management
The process of planning, organizing, leading, and controlling an organization’s financial, physical, human, and information resources to achieve it’s goals.
Planning
Management process of determining what an organization needs to do and how best to get it done.
Organizing
Management process of determining how best to arrange an organization’s resources and activities in a coherent structure.
Leading
Management process of guiding and motivating employees to meet an organization’s objectives.
Controlling
The process of monitoring a firm’s performance to make sure that it is meeting it’s goals.
Common Titles for Top Managers
President, Vice-President, Treasurer, Chief Executive Officer, and Chief Financial Officer.
Top Manager
Manager responsible for a firm’s overall performance and effectiveness.
Common Titles for Middle Managers
Plant manager, Operations manager, and division manager.
Middle Manager
Manager responsible for implementing the strategies and working toward the goals set by top managers.
Common Titles for First-Line Managers
Supervisor, Office manager, Project manager, and group leader.
First-Line Manager
Manager responsible for supervising the work of employees.
Human Resource Manager
Hires and trains employees, evaluates performance, and determines compensation.
Operations
Refers to the systems by which a firm produces goods and services.
Operations Manager
Responsible for production, inventory, and quality control.
Marketing Manager
Responsible for getting products from producers to consumers.
Information Manager
Design and implement systems to gather, organize, and distribute information.
Financial Manager
Plan and oversee the company’s accounting functions and financial resources.
Interpersonal Roles
A category of managerial roles including figurehead, leader, and liaison.
Informational Roles
A category of managerial roles including monitor, disseminator, and spokesperson.
Decisional Roles
A category of managerial roles including entrepreneur, disturbance handler, resource allocator, and negotiator.
Technical Skills
Skills needed to perform specialized tasks.
Human Relations Skills
Skills in understanding and getting along with people.
Conceptual Skills
Abilities to think in the abstract, diagnose and analyze different situations, and see beyond the present situation.
Decision-Making Skills
Includes the ability to effectively define a problem and to select the best course of action.
Time Management Skills
The productive use that managers make of their time.
Leading Causes of Wasted Time
Paperwork, telephone calls, meetings, e-mail.
Strategic Management
The process of helping an organization maintain an effective alignment with it’s environment.
Goals
Objectives that a business hopes and plans to achieve.
Strategy
A broad set of organizational plans for implementing the decision made for achieving organizational goals.
Purpose of Goal Setting
Provides direction and guidance for managers at all levels, helps firms allocate resources, helps to define corporate culture, helps managers assess performance.
Mission Statement
Organization’s statement of how it will achieve it’s purpose in the environment in which it conducts it’s business.
Long-Term Goal
Goal set for an extended time, typically five years or more into the future.
Intermediate Goal
Goal set for a period of one to five years in the future.
Short-Term Goal
Goal set for the near future.
Corporate Strategy
Strategy for determining the firm’s overall attitude toward growth and the way it will manage its business or product lines.
Business (or Competitive) Strategy
Strategy at the business unit or product line level focusing on improving a firm’s competitive position.
Functional Strategy
Strategy by which managers in specific areas decide how best to achieve corporate goals through productivity.
Strategy formulation
Creation of a broad program for defining and meeting an organization’s goals.
Strategic Goal
Goal derived directly from a firm’s mission statement.
SWOT Analysis
Identification and analysis of organizational strengths and weaknesses and environmental opportunities and threats as part of strategy formulation.
Environmental Analysis
Process of scanning the business environment for threats and opportunities.
Organizational Analysis
Process of analyzing a firm’s strengths and weaknesses.
Strategic Plan
Plan reflecting decisions about resource allocations, company priorities, and steps needed to meet strategic goals.
Tactical Plan
Generally short-term plan concerned with implementing specific aspects of a company’s strategic plans.
Operational Plan
Plan setting short-term targets for daily, weekly, or monthly performance.
Contingency Planning
Identifying aspects of a business or it’s environment that might entail changes in strategy.
Crisis Management
Organization’s methods for dealing with emergencies.
Corporate Culture
The shared experiences, stories, beliefs, and norms that characterize an organization.