powerpoint presentation to accompany chapter 4 of management fundamentals canadian edition...
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PowerPoint Presentation to Accompany Chapter 4 of
Management FundamentalsCanadian Edition
Schermerhorn Wright
Prepared by: Michael K. McCuddy
Adapted by: Lynda Anstett & Lorie Guest
Published by: John Wiley & Sons Canada, Ltd.
Management Fundamentals - Chapter 4 2
Planning Ahead — Chapter 4 Study Questions
What is the external environment of organizations?
What is a customer-driven organization?What is a quality-driven organization?What is organizational culture?How is diversity managed in a multicultural
organization?
Management Fundamentals - Chapter 4 3
Study Question 1: What is the external environment of organizations?
Competitive advantage is a core
competency that clearly sets an organization
apart from competitors and gives it an
advantage over them in the marketplace.
Management Fundamentals - Chapter 4 4
Study Question 1: What is the external environment of organizations?
Companies may achieve competitive advantage in many ways, including:
• Products
• Pricing
• Customer service
• Cost efficiency
• Quality
Management Fundamentals - Chapter 4 5
Study Question 1: What is the external environment of organizations?
The general environment — all of the background conditions in the external environment of the organization including:– Economic – Socio-cultural – Legal-political – Technological – Natural environment
Management Fundamentals - Chapter 4 6
Study Question 1: What is the external environment of organizations?
The specific (task) environment — actual organizations, groups, and persons with whom an organization interacts and conducts business.
Includes important stakeholders such as:– Customers
– Suppliers
– Competitors
– Regulators
– Investors/owners
Management Fundamentals - Chapter 4 7
Figure 4.1 Stakeholder analysis of value creation for key constituencies of a business firm: an open-systems approach.
Management Fundamentals - Chapter 4 8
Study Question 1: What is the external environment of organizations?
Environmental uncertainty is a lack of complete
information regarding what exists and what
developments may occur in the external
environment.
Two dimensions of environmental uncertainty:
– Complexity
– Rate of change
Management Fundamentals - Chapter 4 9
Figure 4.2 Dimensions of uncertainty in organizational environments.
Management Fundamentals - Chapter 4 10
Study Question 2: What is a customer-driven organization?
External customers purchase the
organization’s goods or utilize its services.
Internal customers are the persons and
groups within an organization who depend
on the results of others' work to do their
own jobs.
Management Fundamentals - Chapter 4 11
Figure 4.3 The importance of external and internal customers.
Management Fundamentals - Chapter 4 12
Study Question 2: What is a customer-driven organization?
Customers want:– High quality.– Low price.– On-time delivery.
Key customer service lessons:– Protect reputation for quality products.– Treat customers right.
Management Fundamentals - Chapter 4 13
Study Question 2: What is a customer-driven organization?
Customer relationship management establishes
and maintains high standards of customer service
in order to strategically build lasting relationships
with and add value to customers.
Supply chain management is the strategic
management of all operations relating to an
organization’s resource suppliers.
Management Fundamentals - Chapter 4 14
Study Question 3: What is a quality-driven organization?
Quality organizations understand and respond to customer
expectations of quality products and services
Total quality management (TQM)
– Quality principles are an integral part of organization’s strategic
objectives.
• Applying them to all aspects of operations.
• Committing to continuous improvement.
• Striving to meet customers’ needs by doing things right the first time.
Management Fundamentals - Chapter 4 15
Study Question 3: What is a quality-driven organization?
Crosby’s “four absolutes” of management for total quality control:– Quality means conformance to standards.– Quality comes from defect prevention, not
defect correction.– Quality as a performance standard must mean
defect-free work.– Quality saves money.
Management Fundamentals - Chapter 4 16
Study Question 3: What is a quality-driven organization?
Quality and continuous improvement– W. Edwards Deming emphasized:
• Constant innovation.
• Use of Statistical methods.
• Training in the fundamentals of quality assurance.
– Continuous improvement • Seeking ways to improve on current performance.
– Quality circles• A small group of workers who meet regularly to discuss ways
of improving quality.
Management Fundamentals - Chapter 4 17
Study Question 3: What is a quality-driven organization?
Quality, technology, and design:– Lean production
• Uses new technologies to streamline systems.
– Flexible manufacturing• Processes can be changed quickly to produce
different products or modifications of existing ones.
– Agile manufacturing/mass customization• Permits quick production of individualized
products.
Management Fundamentals - Chapter 4 18
Study Question 3: What is a quality-driven organization?
Quality and product design:
– A good design has eye appeal and is easy to
manufacture with productivity.
– Design for manufacturing emphasizes lower
production costs and high-quality results.
– Design for disassembly involves taking into
account how components will be recycled.
Management Fundamentals - Chapter 4 19
Study Question 4: What is organizational culture?
Organizational culture is the system of
shared beliefs and values that develops
within an organization and guides the
behavior of its members.
Management Fundamentals - Chapter 4 20
Study Question 4: What is organizational culture?
How to read an organization’s culture (SCORES)
S - How tight or loose is the structure?
C - Are decisions change oriented or driven by the status quo?
O - What outcomes or results are most highly valued?
R - What is the climate for risk-taking, innovation?
E - How widespread is empowerment, worker involvement?
S - What is the competitive style, internal and external?
Management Fundamentals - Chapter 4 21
Figure 4.4 Levels of organizational culture—observable culture and core culture.
Management Fundamentals - Chapter 4 22
Study Question 4: What is organizational culture?
Strong cultures: – Commit members to do things that are in the best
interests of the organization.– Discourage dysfunctional work behavior.– Encourage functional work behavior.
The best organizations have strong cultures that:– Are performance-oriented.– Emphasize teamwork.– Allow for risk taking.– Encourage innovation.– Value the well being of people.
Management Fundamentals - Chapter 4 23
Study Question 4: What is organizational culture?
What is observable culture?– What one sees and hears when walking around an
organization.
Elements of observable culture:– Stories
– Heroes
– Rites and rituals
– Symbols
Management Fundamentals - Chapter 4 24
Study Question 4: What is organizational culture?
What is the core culture?– Underlying assumptions and beliefs that
influence behavior and contribute to the observable culture.
Core culture and values:– Strong cultures have a small but enduring set of
core values. – Commitment to core values is a key to long-
term success.
Management Fundamentals - Chapter 4 25
Study Question 4: What is organizational culture?
Important cultural values include:– Performance excellence
– Innovation
– Social responsibility
– Integrity
– Worker involvement
– Customer service
– Teamwork
Management Fundamentals - Chapter 4 26
Study Question 4: What is organizational culture?
Value-based management:– Describes managers who actively help to
develop, communicate, and enact shared values.
– Criteria for evaluating core values:• Relevance
• Integrity
• Pervasiveness
• Strength
Management Fundamentals - Chapter 4 27
Study Question 4: What is organizational culture?
Symbolic leadership– Symbolic leaders use symbols well to establish and
maintain a desired organizational culture.
– Symbolic leaders behave in ways that espouse organization’s values.
– Symbolic leaders:• Use language metaphors.
• Highlight and dramatize core values and observable culture.
• Use rites and rituals to glorify performance.
Management Fundamentals - Chapter 4 28
Study Question 5: How is diversity managed in a multicultural organization?
Diversity:
– Describes differences among people at work.
– How diversity is handled in the workplace
reflects the organization’s culture.
• Respect and inclusion.
• Disrespect and exclusion.
– A potential source of competitive advantage.
Management Fundamentals - Chapter 4 29
Study Question 5: How is diversity managed in a multicultural organization?
Characteristics of multicultural organizations:– Pluralism
– Structural integration
– Informal network integration
– Absence of prejudice and discrimination
– Minimum intergroup conflict
Management Fundamentals - Chapter 4 30
Study Question 5: How is diversity managed in a multicultural organization?
Organizational subcultures– Cultures based on shared work responsibilities and/or
personal characteristics. Common subcultures include:
– Occupational– Functional– Ethnic or national– Racial– Generational– Gender
Management Fundamentals - Chapter 4 31
Study Question 5: How is diversity managed in a multicultural organization?
Challenges faced by minorities and women:
– Glass ceiling
– Misunderstanding and lack of sensitivity
– Sexual harassment
– Pay discrimination
– Job discrimination
Minorities may adapt by exhibiting biculturalism.
Management Fundamentals - Chapter 4 32
Figure 4.5 Glass ceilings as barriers to women and minority cultures in traditional organizations.
Management Fundamentals - Chapter 4 33
Study Question 5: How is diversity managed in a multicultural organization?
Diversity leadership approaches:
– Advancing action commits the organization to hiring
and advancing minorities and women.
– Valuing diversity commits the organization to
education and training programs.
– Managing diversity commits to changing the
organizational culture.
Management Fundamentals - Chapter 4 34
Figure 4.6 Leadership approaches to diversity—from affirmative action to managing diversity.
Source: Developed from R. Roosevelt Thomas, Jr., Beyond Race and Gender (New York: AMACOM, 1991), p. 28.
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