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A BRIEF HISTORY OF MANAGEMENT

Other Teaching Tools 2.2

Video Notes 2.3

Brief Chapter Outline and Learning Goals 2.4

Lecture Outline and Lecture Notes 2.6

Notes for End-of-Chapter Material 2.24

REVIEW QUESTIONS 2.24

DISCUSSION EXERCISE 2.1 Face Time: The New Assembly Line 2.24

DISCUSSION EXERCISE 2.2 3M: A Struggle Between Efficiency and 2.25Creativity

Career Management Notes 2.26

Study Skills Notes 2.28

Lecture Links 2.29

LECTURE LINK 2-1 Early Management Development 2.29

LECTURE LINK 2-2 Speeding Up the Drive Through 2.29

LECTURE LINK 2-3 The Complicated Legacy of Henry Food 2.30

LECTURE LINK 2-4 More on Theory Z 2.31

Critical Thinking Exercises 2.33

CRITICAL THINKING EXERCISE 2-1 Theory X or Theory Y? 2.33

CRITICAL THINKING EXERCISE 2-2 Management Challenge 2.34

Bonus Cases 2.35

BONUS CASE 2-1 UPS Uses Scientific Management 2.35

BONUS CASE 2-2 The Supermarket Manager 2.37

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APT

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OTHER TEACHING TOOLS

For a description of each of these valuable teaching tools, please see the Preface in this manual.

Student Learning ToolsStudent Online Learning Center (OLC) (www.mhhe.com/ghillyermanagement) Student Study GuideSpanish Translation Glossary (OLC)Spanish Translation Quizzes (OLC)

Instructor Teaching ToolsInstructor Online Learning Center (www.mhhe.com/ghillyermanagement)Annotated Instructor’s Resource ManualIRCD (Instructor’s Resource Manual, Test Bank, PowerPoints, EZtest)Asset Map PageOutPowerPoint Presentations (on IRCD and OLC)Test Bank Management at the Movies (DVD)Management Videos on DVD Enhanced Cartridge optionSpanish Translation Glossary (OLC)

2.2 MANAGEMENT: A REAL WORLD APPROACH: Instructor’s Resource Manual

VIDEO NOTES

Two video series are available for use with MANAGEMENT: A REAL-WORLD APPROACH.

Management at the Movies This innovative video collection includes video clips from twenty of the best Hollywood films.

The Video Notes section of this Instructor’s Resource Manual (beginning on page V.1) provides In-structor’s Teaching Notes for each of the video segments, along with Student Materials keyed to chapter concepts.

MOVIE 5. “Gung Ho” (“Assan Motors”) (1:13)This video clip shows the differences in American and Japanese company culture. An

American manager faces a Japanese board of directors and encounters many language and cul-tural barriers.

MOVIE 13. “Hoosiers” (“And Two More”) (4:10) This film is loosely based on the 1954 Milan High School basketball team. A veteran

coach starts his new assignment by kicking two players off the basketball team. It illustrates ef-fective and ineffective leadership.

Management Videos on DVDAlso included are twenty videos geared to individual chapter topics. The teaching notes for these

videos are also included in the Video Notes section of this Instructor’s Resource Manual, beginning on page V.50.

VIDEO 2: “Working for the Best: The Container Store” (11:03)By using historical management movements, the video outlines key factors of how the

Container Store approaches management.

CHAPTER 2: A Brief History of Management 2.3

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BRIEF CHAPTER OUTLINE AND LEARNING GOALS

CHAPTER 2

A Brief History of Management

I. THE HISTORY OF MANAGEMENT

II. U.S. INDUSTRIAL REVOLUTIONLEARNING OBJECTIVE 1Explain the role of the Industrial Revolution in the development of managerial thought and identify the captains of Industry and their role in management’s evolution.

III. CAPTAINS OF INDUSTRY

IV. SCIENTIFIC MANAGEMENT AND FREDERICK WINSLOW TAYLOR

LEARNING OBJECTIVE 2Define scientific management and outline the role Frederick W. Taylor played in its develop-ment.

A. Scientific ManagementB. Other Scientific Management Pioneers

V. THE HUMAN RELATIONS MOVEMENT LEARNING OBJECTIVE 3Identify and explain the human relations move-ment.

A. The Hawthorne StudiesB. Early Champions of Human RelationsC. The Professional Manager

VI. THE SYSTEMS APPROACHLEARNING OBJECTIVE 4Explain the systems approach.


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VII. THEORY X AND THEORY YLEARNING OBJECTIVE 5Explain the differences between Theory X, The-ory Y, and Theory Z.

VIII. THE CONTINGENCY APPROACHLEARNING OBJECTIVE 6Define the contingency approach to manage-ment.

IX. THE JAPANESE MANAGEMENT MOVEMENT AND THEORY Z

X. THE SEARCH FOR EXCELLENCELEARNING OBJECTIVE 7Explain the concepts of the search for excellence and the emphasis on quality.

XI. THE EMPHASIS ON QUALITY

XII. MOVING FROM GOOD TO GREATLEARNING OBJECTIVE 8Understand what is required for an organization to move from good to great.

XIII. CONCLUSION


LECTURE OUTLINE AND LECTURE NOTES

THE WORLD OF WORK

Tony Considers His Style (Text pages 26-27)

Tony, the newly appointed manager of Taco Barn, is over the rush and excitement of being named the new manager of Taco Barn. He is now reflecting on the management styles he has worked un-der and is contemplating how he should handle the management duties of his restaurant. One manage-ment style was more about numbers and costs; the other was more about employees and customers. Since he is now in charge, Tony has to establish his identity as the manager.

1. Why should Tony be concerned about establishing his own style of management in the Taco Barn?

Tony cannot just stand back and let employees base their work on the former management of the restaurant; because employees, without proper direction, will often do the minimal amount work. Tony has to begin taking on management duties that accomplish the goals of company and, in the process, make it work with his own management style. This will include meeting financial objectives as well as staff training and development. His learning curve will lead to some mistakes and uncertainty about han-dling all the management functions as the new store manager. But in the process, Tony must be genuine and, at the very least, show his passion and dedication to a job well done. Anything less will make this new task very trying for the new manager.

2. Whose management style do you like better: Jerry’s or Dawn’s? Why?

Management styles are an interesting study in the psychology of inferred focus and drive by those in leadership situations. Dawn appeared to favor numbers and costs as the main objectives of her employ-ees. Jerry appeared to be more focused on working with his employees and caring about their well-being. Did Dawn care about her employees in the process of achieving store goals? Did Jerry want to look good with stores sales and in-line costs while working closely with employees? Both managers probably under-stand the importance of meeting all expectations, but their own styles ultimately win out. From the per-spective of upper level management, the Dawn’s style was probably more favored as she focused so much on the sales and costs of the restaurant. Jerry was also successful because he was able to meet the objec-tives of the store using a different style. However, from the store employee level, Jerry was more popular because of his interest in people over numbers. This style would be more popular to the average em-ployee, all things considered.

3. Do you think Tony will choose Jerry’s style or Dawn’s? Why?

Tony might move towards the style Dawn used as a signal to upper level management that he has a handle on the important goals of the restaurant. Also, close work with the employees initially might be difficult for Tony, since he has so much to learn about the entire store management process. These weak-nesses might be revealed until he becomes more seasoned in his overall management functions and how they can be best carried out through his employees. However, Tony will learn more about management, both on the job and through company development and training. This will help him evolve and learn what style best fits him and how he can become the best manager he can be over time.

4. If you are currently in a management role, how would you describe your style? If you are work-ing toward a management position, do you think you would be more like Dawn or Jerry? Why?


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This would be a good time to discuss personality styles and the tendencies they suggest about a person. For example, if you are more detail-orientated in handling your job duties, you might be more likely to use this style in your management operating methods. If you are more of a people person in your managing style, this approach will suit you in your daily duties of handling your job. Therefore, one style may or may not be better than another. Good managers evolve into better managers by recognizing their strengths and weaknesses. They can use management tools to compensate for perceived weaknesses to ensure good balance and effective results for the manager’s career and the benefit of the company as a whole.

LECTURE OUTLINE LECTURE NOTES

I. THE HISTORY OF MANAGEMENTA. Understanding the historical evolution of

management problems can help modern managers cope with them.

B. Management in some form has existed since the beginning of time.

C. New approaches became necessary with the emergence of large corporate organi-zations in the 19th century.

POWERPOINT 2-1Chapter Title(Refers to text page 26)

POWERPOINT 2-2Learning Objectives(Refers to text page 27)

POWERPOINT 2-3Learning Objectives (continued) (Refers to text page 28)

LECTURE LINK 2-1Early Management DevelopmentManagement has existed in some form throughout civi-lization. See complete lecture link on page 2.29 of this manual.

POWERPOINT 2-4The History of Management (Refers to text page 28)

II. U.S. INDUSTRIAL REVOLUTIONLEARNING OBJECTIVE 1 Explain the role of the Industrial Revolution in the development of managerial thought and identify the captains of Industry and their role in management’s evolution. (Text pages 28-30)

A. The U.S. INDUSTRIAL REVOLUTION encompasses the period when the United States began to shift from an almost totally farming-based society to an industrialized

POWERPOINT 2-5U.S. Industrial Revolution(Refers to text page 28)


LECTURE OUTLINE LECTURE NOTESsociety, generally thought to begin around 1860.

B. According to Daniel Wren, the Industrial Revolution had three facets: power, trans-portation, and communication.

1. Inventions, such as the steam engine, freed businesses from dependence on water and horses for power.

2. Canals, railroads, and efficient road systems improved transportation, but brought on new problems.

3. Communication by telegraph, tele-phone, and radio changed the way U.S. businesses functioned.

III. CAPTAINS OF INDUSTRYA. At the end of the 19th century, the economy

had shifted from agriculture to manufactur-ing.

B. During this period, American business was dominated by Captains of Industry.

1. John D. Rockefeller (oil) 2. James B. Duke (tobacco) 3. Andrew Carnegie (steel) 4. Cornelius Vanderbilt (steamships and

railroads)C. These captains often pursued profit and

self-interest above all else. 1. They formed giant companies and cre-

ated new forms of organizations. 2. Nationwide distributing and marketing

organizations were formed.D. New management approaches were

needed.

POWERPOINT 2-6Captains of Industry(Refers to text page 29)


LECTURE OUTLINE LECTURE NOTES 1. Government regulation of business be-

gan in 1890 with the Sherman Antitrust Act.

2. By this time, corporations had become large in scale, with national markets.

3. The invention of the internal combus-tion engine and the use of electricity spurred industrial growth.

E. The welfare of workers deteriorated. 1. Wages were low, and production

methods were crude. 2. Little attention was given to the

psychological and physical aspects of a job, such as boredom, repetitive-ness, and fatigue.

F. During this time, engineers who had designed production systems began to study the methods used in these systems.

PROGRESS CHECK QUESTIONS (Text page 30)

1. Explain why management did not emerge as a recog-nized discipline until the twentieth century.

2. Describe the three key aspects of the U.S. Industrial Revolution.

3. Who were the four leading captains of industry during this period?

4. What role did the captains of industry play in the devel-opment of modern organizations?


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IV. SCIENTIFIC MANAGEMENT AND FREDERICK WINSLOW TAYLOR

LEARNING OBJECTIVE 2 Define scientific management and outline the role Fred-erick W. Taylor played in its development. (Text pages 31-35)

A. Early Development 1. The increased use of specialization

meant workers performed only a few tasks.

a. Engineers began to study work-flows and job content.

b. A paper presented in 1886 by Henry Towne to the American So-ciety of Mechanical Engineers sparked engineer interest in general business problems.

2. Frederick Winslow Taylor, a mechani-cal engineer, began studying problems at Midvale Steel Company.

a. Taylor found a tendency to SOLDIERING, the actions of employees who intentionally restrict output.

b. Taylor discovered that most wage systems were based on atten-dance and position, not output.

c. He argued for a piece-rate system that was fairly set and adminis-tered.

B. SCIENTIFIC MANAGEMENT is the philosophy of Frederick W. Taylor that sought to increase productivity and make work easier by scientifically studying work methods and establishing standards.

1. Scientific management was based on

POWERPOINT 2-7Scientific Management and Frederick Winslow Taylor(Refers to text page 31)

TEXT REFERENCEStudy Skills Box: Rate Your Study Skills (Box in text on page 32.) An additional exercise and dis-cussion is available on page 2.28 of this manual.

LECTURE LINK 2-2Speeding Up the Drive-ThroughFast-food restaurants are try-ing to improve the speed of delivery service to cus-tomers pulling up at the take-out window. See complete lecture link on page 2.29 of this manual.


LECTURE OUTLINE LECTURE NOTESCASE INCIDENT 2.1

Granddad’s Company (Text page 35)

A family-run manufacturing industrial tools firm is going to turn management over to the third generation. The grandson has new ideas to change how the company should be run. Before this hap-pens, the current outgoing president (James Vail Jr.) will discuss the matter with his son Richard, who is does not agree with the management operating method of using time and motion studies (scientific man-agement) to manage each job efficiently.

1. Do you agree with Richard? Why or why not?

This argument is whether to go with the current success of the company or to incorporate new management philosophies that might work but have not been incorporated into this company’s way of doing business. A good discussion should take place. It might be a good time to place each of the two names on the board (James Vail Jr. and Richard Vail) and then list reasons why students support one or the other positions.

2. Are the principles of scientific management applicable in today’s organization? Explain your answer.

Like any management philosophy or style, fully supporting the method and incorporating the ideology throughout the company is important to its success. The scientific management method has been successful because of the company’s commitment to support this style of management. Until change is made and new philosophies are integrated throughout the company, there is no reason to be-lieve the current management style cannot continue to be effective. However, there is also no reason not to survey the workers and get their opinions on the current managing style, and see if minor changes would help to make the job and overall output better or if major changes are necessary. If minor tweaks are the consensus, then this management style should continue. If major changes are deemed necessary, then more time must be spent investigating the effects of making the new changes that Richard supports. However, split efforts will not work. If change occurs, it must be embraced by the entire company for it to be effective.

3. What are James Jr.’s reasons for keeping things the way they are?

James Jr. took the reins of the company from his father, the founder, and advanced the company even further. He would not immediately be in favor any changes that would disrupt this success. As a re-sult, a conversation with his son Richard about changing the management style would be very difficult for him at this time.

4. What kind of changes do you think Richard would like to make?

Richard has to respect the work of his father and grandfather. He must think more about his ideas for immediate changes in the management operating style. Richard must be careful to not loose support of his taking over the company without good cause. More discussions must take place so that a difficult, unfriendly transition does not take place. He also needs to consider the reactions of the board of directors, who could vote on such matters.

However, Richard probably is in favor of cross-job training and more employee empowerment. This management approach might initially be exciting for employees but must be carried out properly to


LECTURE OUTLINE LECTURE NOTESbe truly effective. This change would be dramatic and somewhat difficult to employ if not fully sup-ported by all workers and management.


5. Define scientific management.6. What were Taylor’s four main principles of scientific

management?7. List Fayol’s 14 principles.8. Explain Fayol’s five elements of management.


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V. THE HUMAN RELATIONS MOVEMENTLEARNING OBJECTIVE 3Identify and explain the human relations movement. (Text pages 36-39)

A. Background 1. The Great Depression of 1929-1932

saw unemployment rise to more than 25%.

2. After this, legislatures and courts supported organized labor and the worker, a period known as the Golden Age of Unionism.

3. A series of pro-union laws were passed during the 1920s and 1930s.

B. The Hawthorne Studies 1. The Hawthorne Studies began in

1924. a. The National Research Council of

the National Academy of Sciences began a project to define the rela-tionship between working condi-tions and worker productivity.

b. At the Hawthorne plant of Western Electric in Cicero, researchers began the study by lowering the level of lighting.

c. Instead of productivity decreasing, it increased.

2. In early 1927 the researchers called in a team of psychologists from Harvard University led by Elton Mayo.

a. In hundreds of experiments, the researchers altered variables such as wage payments, rest periods, and length of workday.

b. Production increased with no

TEXT FIGURE 2.2Significant Pro-Union Legislation During the 1920s and 1930s (Text page 37)

POWERPOINT 2-10The Human Relations Movement and the Hawthorne Studies (Refers to text page 36)

POWERPOINT 2-11The Hawthorne Studies(Refers to text page 36-37)


LECTURE OUTLINE LECTURE NOTESCASE INCIDENT 2.2

Return To Scientific Management (Text page 38)

Recently, a professor at State University was lecturing in a management development seminar on the topic of motivation. The participants candidly discussed problems that existed in their respective organizations. Problem areas mentioned included absenteeism, turnover, and poor workmanship. The participants managed a variety of workers, such as automobile assembly workers, clerical workers, computer operators, sanitation workers, and even some middle-level managers.

During the discussion, one of the participants made the following statement: “What we need to stop all of these problems is a little scientific management.”

1. What do you think this person meant?

The basic concepts of scientific management involve suiting the best workers for the right jobs and establishing standards for each job. Based on these standards, employees could then earn incentives for outperforming the set standard and in the process benefit the worker and the company. This is known as division of labor. This person’s solution to poor performance and absenteeism is to employ the basic concepts of scientific management.

2. Do you agree? Discuss.

Make sure students understand the history of management and how, in the evolution of produc-tion, scientific management was developed. Let students express their opinions of how they view to-day’s management techniques and compare them to the scientific management style as currently in place at the J.R.V. Company. Through this discussion, students can either support current scientific manage-ment concepts or express their views of more modern ways of accomplishing productivity in a broad and diverse workforce.

3. Take one of the jobs in the above case and show how you could apply scientific management.

Scientific management would easily be suited for the assembly worker environment because of its division of labor concept and the motivation to achieve high level results by exceeding the basic stan-dards set for the normal output for each job. In the process, employees are rewarded for exceeding the basic standards of their job. As a result, the worker and the company should enjoy the productivity achieved through this management style.

4. What would be the human relations approach to the same job you selected in question 3?

This style of employee motivation and productivity aims at employee needs in the work envi-ronment rather than improving equipment, setting standards, or worker productivity to these variables. The human relations approach found that workers react to psychological and social conditions at work, such as informal group pressures, individual recognition, and participation in decision making. As a re-sult, the auto assembly structure would rely less on worker hourly output and more on group leaders that work more closely with line workers, giving them a say in the process and rewarding them for their con-tributions to the output.


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VI. THE SYSTEMS APPROACHLEARNING OBJECTIVE 4Explain the systems approach. (Text page 39)

A. In the late 1960s, many management theorists tried to integrate all these the-ories using the systems approach.

B. A SYSTEM is “an assemblage or combina-tion of things or parts forming a complex or unitary whole.”

1. Under the systems approach to management, the organization is seen as an OPEN SYSTEM that is in-fluenced by its internal and external environment. a. The organization then, in turn, in-

fluences these same internal and external environmental factors.

b. As a result, a dynamic relationship is created.

2. In a CLOSED SYSTEM, the organiza-tion has no interaction with its external environment.

3. Most organizations are run as open systems.

POWERPOINT 2-12The Systems Approach(Refers to text page 39)


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VII. THEORY X AND THEORY YLEARNING OBJECTIVE 5Explain the differences between Theory X, Theory Y, and Theory Z. (Text page 39)

A. American social psychologist Douglas Mc-Gregor proposed a division of manage-ment styles that capture what are funda-mentally different ways of managing peo-ple.

1. THEORY X managers manage in a very controlling and authoritative manner.

2. THEORY managers believe that employees: a. can be trusted to meet production

targets without being threatenedb. will often seek additional responsi-

bilities because they enjoy the sat-isfaction of being creative and in-creasing their own skills

3. The theory Y manager manages in a democratic and participative manner.

B. In the late 20th century a broader approach to management was proposed.

POWERPOINT 2-13Theory X and Theory Y(Refers to text page 39)

CRITICAL THINKING EXERCISE 2-1Theory X or Theory YStudents are asked to analyze the assumptions of a past boss. See complete exercise on page 2.33 of this manual.

CRITICAL THINKING EXERCISE 2-2Management ChallengeHow would a Theory X boss handle a crisis situation? How would a Theory Y boss? See complete exercise on page 2.34 of this manual.


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VIII. THE CONTINGENCY APPROACHLEARNING OBJECTIVE 6Define the contingency approach to management. (Text pages 40-41)

A. In the CONTINGENCY APPROACH TO MANAGEMENT, different situations and conditions require different management approaches.

B. Proponents believe there is no one best way to manage; the best way depends on the specific circumstances.

C. Contingency theories have been devel-oped in many areas.

POWERPOINT 2-14The Contingency Approach(Refers to text page 40)

BONUS CASE 2-2The Supermarket ManagerA new employee develops some creative suggestions for improving performance, but her boss reacts badly. See complete case, discussion questions, and suggested an-swers on page 2.37 of this manual.

IX. THE JAPANESE MANAGEMENT MOVEMENT AND THEORY ZA. The economic success of many Japanese

companies focused attention on their man-agement practices in the 1980s.

1. Researchers identified characteristics that differed from traditional American approaches.

2. Japanese managers: a. encouraged employee participa-

tion in decision making b. showed a deeper concern for the

personal well-being of employees c. placed great emphasis on the

quality of their productsB. William Ouchi developed THEORY Z,

which attempts to integrate American and Japanese management practices.

1. Theory Z combines the American emphasis on individual responsibility with the Japanese emphasis on

TEXT REFERENCECareer Management Box: Developing Skills for a Successful Career (Box in text on page 40) An addi-tional exercise and discus-sion is available in this chap-ter on page 2.26.

TEXT FIGURE 2.3Comparison of Japanese, American, and Theory Z Organizations (Text page 41)

LECTURE LINK 2-4More on Theory ZWilliam Ouchi merged tradi-tional American management and Japanese management practices to develop a hybrid, which he named Theory Z. See complete lecture link on page 2.31 of this manual.


LECTURE OUTLINE LECTURE NOTEScollective decision making.

2. Other factors combine traditional American and Japanese practices.


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X. THE SEARCH FOR EXCELLENCELEARNING OBJECTIVE 7Explain the concepts of the search for excellence and the emphasis on quality. (Text pages 41-43)

A. In 1982, Thomas J. Peters and Robert H. Waterman Jr. published In Search of Ex-cellence.

1. Peters and Waterman used a combi-nation of standards and measures of financial success to identify 36 “excel-lent” American companies.

2. Peters and Waterman identified eight “attributes of excellence,” including:a. a bias for actionb. autonomy and entrepreneurshipc. simple form, lean staff, and so on.

3. Their work caused many managers to rethink their ways of doing things.

B. The Experience of “Excellent” Compa-nies

1. Two years after In Search of Excel-lence was published, 12 of these companies were unable to adapt to fundamental changes in their market.

2. Some blamed Peters and Waterman’s characteristic definitions, which did not emphasize reacting to trends.

C. Two lessons can be drawn from these experiences:

1. The excellent companies of today will not necessarily be the excellent companies of tomorrow.

2. Good management requires more than following a set of rules.

POWERPOINT 2-15The Search for Excellence(Refers to text page 41)

TEXT FIGURE 2.4Peters and Waterman’s Eight Characteristics of Excellent Companies (Text page 42)



XI. THE EMPHASIS ON QUALITYA. In the early 1990s the emphasis was fo-

cused on overall quality of the product or service.

B. The low quality of American products forced managers to look at quality as a way of improving products and services.

1. Attention shifted from finding and correcting mistakes or rejects to preventing them.

2. This led to the development of total quality management (TQM.)

POWERPOINT 2-16The Emphasis on Quality(Refers to text page 43)

THE WORLD OF WORK

Tony Selects a Style (Text page 45)

Tony is now the new manger of Taco Barn and has to find a management style to use in his new position. Tony understands one style is more numbers and cost-orientated while the other style is more people and team-orientated.

1. Tony appears to have chosen a management style. How would you categorize that style based on the information in this chapter?

Tony believes that if he can keep store costs and sales at the current level or improve them, it might make him look like the new hot shot manager. This style has been chosen over the team and peo-ple style that was previously used at his restaurant.

2. Is Tony right in thinking that better numbers will bring him more attention? Why or why not?

In the short term, Tony might be able to pull this off and think this style is best for his career. However, in a smaller store management environment, looking for “results” without a team effort will probably not work. Tony has to learn how to get results through his people in a positive way rather than focusing on bottom line results that can destroy the team effort in the process.

3. Do you think the Taco Barn employees will like the new Tony? Why or why not?

The employees of Taco Barn are used to a team approach from the previous manager. This new result at all costs, it appears, will not lend itself to long term productivity. The employees need to respect the new manager, and the new manager needs to respect his employees. An exploring and growing process needs to be used, and so far Tony has not taken this approach. Therefore, he is not viewed as the best person to replace the previous manager.

4. How would you advise Tony in this situation? What approach do you think he should follow? Why?


LECTURE OUTLINE LECTURE NOTESTony needs to take a step back and review the reasons his restaurant has been successful. While

he is new at the manager position, it is often wise to not make dramatic changes until there is a reason to do so. Tony would be best served to meet with his employees and discuss how the restaurant has been previously run. He should also let his employees know that he might have some new and different ways to manage the operation, but intends to include his employees as a key ingredient to the overall success. This approach would be best for the health and future success of Taco Barn.


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XII. MOVING FROM GOOD TO GREATLEARNING OBJECTIVE 8Understand what is required for an organization to move from good to great. (Text pages 43-44)

A. Stanford University business professors Jim Collins and Jerry Porras published Built to Last: Successful Habits of Vision-ary Companies.

1. Collins and Porras stressed creating a lasting organization by relying on “homegrown management.”

2. Their lesson was that managers can never rely on their current successes to guarantee future success.

B. In 2000, Collins and his researchers pub-lished Good to Great: Why Some Compa-nies Make the Leap… and Others Don’t.

1. Their study identified 11 finalists that met Collins’s standards as “great” companies and that also maintained this status for 15 years.

2. The HEDGEHOG CONCEPT states that great companies develop a simple core concept that guides all their future strategies, as opposed to chasing ev-ery new management fad or policy im-plementation.


13. Describe the contingency approach to management.14. What are the differences between Theory X, Theory Y,

and Theory Z?15. Summarize the eight characteristics of excellent compa-

nies identified by Peters and Waterman in their book In Search of Excellence.

16. Explain Jim Collins’s hedgehog concept?

XIII. CONCLUSION

POWERPOINT 2-17Moving from Good to Great (Refers to text page 43-44)

TEXT FIGURE 2.5Comparison of Built to Last Versus Good to Great(Text page 44)


ETHICAL MANAGEMENT (Text page 46)

The XYZ Corporation has been growing rapidly over the past three years. To help manage this growth, the CEO decides to create a new director level position. The position requires extensive business expertise, an understanding of the XYZ Corporation’s industry, and exemplary strong people skills.

Two candidates remain after the final interviews: John, an external candidate with a strong busi-ness background, and Mary, a candidate from within the company, who also has the required skills. After two rounds of interviews, the vice president for human resources decides to offer the position to John. John considers the offer for several days, but decides to turn it down.

The vice president then meets with Mary and offers her the position. Upon hearing the offer, Mary pauses. She looks the VP straight in the eye and asks, “Was the job offered to John first?”

How should the vice president respond?

The response should be: “Yes, we offered the job to John first.” By answering the question hon-estly, the vice president can maintain the integrity of his position (as it should be) and in the process get into a discussion as to why John was offered the position first. This could open a good dialogue as to why John was originally considered for the position and what areas Mary might focus on for improvement. This might indirectly be a good opportunity for Mary, as it gives her the chance to identify and work on some of her weaknesses, and could lead to her becoming more successful in the new position.


NOTES FOR END-OF-CHAPTER MATERIAL

REVIEW QUESTIONS

1. What are the benefits of understanding how management theory and practice has changed over the past 100 years? How could you use this information as a manager?

Understanding the historical evolution of management problems can help modern managers cope with them.

2. Why do you think many people have interpreted Taylor’s scientific management principles as be-ing inhumane?

The foundation of scientific management was finding the one best way to do a job and training workers to perform more efficiently. Taylor and his followers focused on job design, and many felt this approach ignored the human factor. In fact, Taylor argued that workers would be rewarded for superior performance by increased wages, which directly benefited the worker.

3. What are the key differences between the principles of scientific management and the key ele-ments of human relations management?

Scientific management is based on scientific research and experimentation that emphasized maxi-mum output with minimum effort through the elimination of inefficiency. The managers planned the work, the employees performed it. Human relations management, on the other hand, focused on the em-ployee and the psychological and social conditions at work.

4. Would you describe your management style as that of a scientific principles manager or a human relations one? Why?

This question calls for individual self-assessment and will be answered differently by each stu-dent.

DISCUSSION EXERCISE 2.1

Face Time: The New Assembly Line

1. What are the three reasons why “working ungodly hours” can work against you?

Working long hours, five days a week can lead to burnout, lack of creativity, and lack of produc-tivity. Therefore, giving up these three crucial ingredients for “face time” can be nonproductive toward generating productive output from key employees.

2. What kind of “face time” does your boss expect at your current job (or at a job you have held in the past)?

Find out if there is a common thread to the corporate idea that seeing employees is more impor-tant than not, and believing that “face time” matters more than any other single contribution that they can do for the company.

3. Have you ever felt pressure to put in more face time to keep up with your co-workers? How did you handle that pressure?


This is a good question because peer pressure is a real activity that occurs in the corporate world and its impact can create a culture of workers believing that “face time” is essential no matter what. Ask about how students might have been faced with this, and what the mindset becomes once you believe that face time controls the success of your career.

4. Is there a solution to the pressure of face time? How could you reassure your boss that you are being productive even when he can’t see you every minute of the working day?

Results can cure all job-related matters if you can develop the right relationship with your boss in doing your job at times and places that help make you more productive. This might be the exception to the rule and might require that you initially force the issue to get your opportunity to have more freedom to work outside the walls of the company. Always use the results angle for your liberty from the excessive “face time” at he company.

DISCUSSION EXERCISE 2.2

3M: A Struggle Between Efficiency and Creativity

In the spirit of scientific management, innovation can be looked at as a process that considers di-vision of labor and finding highly skilled people to work in these areas. Buckley and McNerney under-stand how to use the “process” at its highest level, by properly supporting it with funds and creating the right culture to foster outcomes that are above normal. While their part was to ensure the structure, the other element was to support employees by understanding their needs and facilitating this through infor-mal group pressures, individual recognition and input into decision making. McNerney and Buckley have the ability to develop the support systems and foster even greater outputs by recognizing the needs of em-ployees, resulting in greater achievements in the process.

2. Why would the use of “exact statistical analysis” reduce creativity?

Creativity is not an exact science. It takes many attempts to find ways to improve what has al-ready been tried. New inventions rarely happen in first attempt. Therefore, asking for this approach to oc-cur under these conditions is foolish and shows a lack of understanding of how creativity works.

3. Why would an organization “deliberately encourage risk”?

Without an environment that allows for risk taking, new ways of thinking cannot be explored. Better outcomes can be found by adding this to the management’s culture. Risk, if understood and prop-erly evaluated for its potential outcome, can be a motivating factor for change if properly supported and cultivated within an organization.

4. Do you think Buckley’s plan will work? Why or why not?

Yes. Buckley has realized that the support of sameness and lack of attention to creativity has cost his company. Many companies have moved ahead of 3M in creativity. Because of this, Buckley is now supporting innovation at the company and plans to shift away from profitability to process and invest in innovation and growth.


CAREER MANAGEMENT NOTES

Developing Skills for a Successful Career

Instructor’s Notes for Text Box Two: Objectives to consider and implement to increase students knowledge, usage and understanding of the concepts.

Have you analyzed the POTENTIAL of your career, considering the overall skills necessary to contribute to a job/company as you see below? This analysis is important to the value of your position as companies evaluate you for hire. Your ability to find this out and put it in a usable format is important and something you will need to become experienced at doing. Let’s look more at this concept.

STUDENT EXERCISE:Getting students to do an honest assessment of how becoming a good, valuable employee is a

process of understanding a wide range of skills and knowledge that creates a larger view in terms what it requires to be a return on the company’s investment. Have students look at the list of skills and rate them-selves. Upon completion, discuss similar high rankings and also where there might be some common low scores. Ask students how much they learned about themselves in the process!

Assessment Objectives:

At this point, it is important to use a numeric scale to assess where you think your current skills are with regards to industry hiring needs. Take a look at the following questions and use this evaluation estimate as a guide for where you are currently in your skill set in relations to the job industry and the job opportunities that might exist for an entry or mid-level position.


Rating My Skills (1=lowest; 10=highest)

RATING:

Leadership Skills ________(Doing your work as expected; ability to lead others to do

the same)

Team Building Skills ________(Thinking team/job first, not was is best for self)

Analytical Skills ________(Understanding budgets, spending objectives, cost saving, etc.)

Marketing Skills ________(Understand the basic marketing concepts and how it relates

to your company/job/department)

Industry Knowledge ________(How much do you know about your industry and how can

this make you a more valued employee)

Management Skills ________(Your ability to manage yourself and the responsibilities given

to you on the job)

Problem Solving Skills ________(The ability to work through the challenges of the job when

simple answers are not obvious)

Planning Skills ________(Planning your work for the best possible outcome and highest

results for your job/department/company)

Empathetic Skills ________(Your customers’ dissatisfaction with your product and service

and your ability to understand why the customer feels this way)

Technology Skills ________(Your ability to use the latest technology to enhance your

job; remaining current on technology uses)

TOTAL SCORE ________

Ten for Ten…How do I rate based on ten key skills valued at 10 possible points for each skill? What are the strengths that I have as well as possible weaknesses?


STUDY SKILLS NOTES

Rate Your Study Skills

Instructor’s Notes for Text Box Two: Objectives to consider and implement to increase students knowledge, usage and understanding of the concepts.

If you were asked, how good are your study skills? What are your strengths when it comes to study knowledge, preparation, and execution? What has been your history? How would you grade your-self? Where might you need the most help?

Study skill assessment is important for many reasons. Before we can improve, fix or change our current study history, we need to do an honest assessment. Therefore, if you could give yourself a grade for the following: 1-study knowledge, 2-study preparation, 3-study execution. What does your report card look like? Are you going out to celebrate or grounded for a poor report card? What can be done to improve your performance? Stay tuned…

STUDENT EXERCISE:Get the students to begin thinking of how they perceive their study habits – are they poor, aver-

age, or very good? Before students can improve this skill, they must honestly look at their past and cur-rent study patterns and see where their strengths and weaknesses might be. Review the grades and discuss the reasons students chose a particular rating. Explain to them how improved work in these areas might help them do better in their classes and in the long run, making them better retain information whether it is for a class, a job, or any other learning environment they might encounter.


LECTURE LINKS

LECTURE LINK 2-1

Early Management Development

Although the text discussion concentrates on the evolution of management since the nineteenth century, many management practices were developed much earlier.

The great civilizations of Sumeria, Babylon, Egypt, Assyria, and Persia had expert managers, as seen by achievements such as the Great Pyramids of Egypt and the Hanging Gardens of Babylon. Ancient builders relied on the use of merit wages to build the walled cities and canals of Sumeria. The highway and library systems of Assyria and the great cities of Persia required organization and managerial genius to achieve. The Code of Hammurabi included incentives and minimum wages as early as 1800 B.C.

Greek achievements in architecture, literature, and civil government required the application of complex management knowledge. The citizens of Greek city states worked under the piecework system on government contracts.

Rome once controlled the world from England to Asia and is still known for its systems of roads, construction of public buildings, and civil government. These were developed and maintained by a mili-tary system continues to be a model for modern armies. These accomplishments required the application of highly developed management knowledge. As early as 300 B.C., Rome used maximum wage laws to try to compensate for a shortage of labor.

China’s Great Wall, complex road system, and silk trade required extensive management exper-tise. The principle of specialization was used as early as 1650 B.C., and labor turnover was understood as early as 400 B.C.

Over 400 years ago, a diplomat and civil servant in the city-state of Florence named Niccolo Machiavelli wrote a book called The Prince. Machiavelli was an experienced observer of the intrigues of state. His book was a how-to manual for a ruler. The Prince focuses on how to rule – not how to be good or wise, but how to rule successfully. Machiavelli’s beliefs about the nature of people of that time are il-lustrated by his famous statement, “Whoever desires to found a state and give it laws, must start with the assumption that all men are bad and ever ready to display their vicious nature whenever they may find oc-casion for it.” He believed that a leader is justified in using any leadership style or tactic to cope with these types of people. That is, the end justifies the means. If a leader had to choose between being feared and loved, she or he should choose fear, since fear can be controlled, not love.

The Roman Catholic Church has contributed greatly to the evolution of management thought. As Christianity spread and different sects emerged, the church needed to define more clearly its mission, pur-pose, objectives, policies, rules, and organizational hierarchy. It developed a strong centralized authority-responsibility relationship. This centralization and the Church’s extensive enforcement of doctrines and rules is one of the major factors leading to the Reformation.

LECTURE LINK 2-2

Speeding Up the Drive-Through

The average service time for a fast-food retailer has not changed in the last decade. Technical and communication advances have reached a point of diminishing returns. Delivery time is limited by how


fast workers can assemble orders, collect payment, and hand out food. Now fast-food retailers are trying to improve the speed of delivery service to customers pulling up at the take-out window.

Drive-through purchases now represent a huge portion of sales. For Burger King, window sales are 70% of total sales. To improve speed, outlets are concentrating on reducing mistakes in orders and making ordering easier.

Pam Farber, daughter of Wendy’s founder Dave Thomas, remembers that when she worked at one of her father’s fast-food stores in the 1970s, customers were frequently baffled by the drive-through concept. She often had to run outside with a pen and pad to help customers who were confused by the bull-horn speakers.

Customers are now comfortable with the drive-through procedure and expect better and faster service. To improve the ordering process, Wendy’s is replacing some text on menus with pictures. It is also placing awnings over menu boards to shield customers from rain and snow. Restaurants like McDon-ald’s and Checkers Drive-In Restaurants have started using confirmation screens, allowing customers to make corrections to their order before pulling up to the window. At McDonalds, that technology has boosted accuracy by more than 11%.

Hyperactive Technologies in Pittsburgh has developed a computer system called “Hyperactive Bob.” The system tells managers how much food they need to prepare by counting vehicles in the drive-through line and adjusting for current promotions. McDonalds is also experimenting with outsourcing, us-ing central call centers rather than cashiers to take orders from drive-through customers. i

LECTURE LINK 2-3

The Complicated Legacy of Henry Ford

Henry Ford founded the Ford Motor Company in 1903, producing an inexpensive, all-purpose car, the Model T. His company grew rapidly after the Model T became an instant success. The close rela-tionship he enjoyed with his skilled workers deteriorated as he installed the assembly line and hired un-skilled workers. In 1913, dissatisfaction among workers resulted in labor turnover of over 380% in one year alone. A small number of workers joined the International Workers of the World, which served as an outlet for the workers’ hostility.

On January 14, 1914, Henry Ford shocked the industry by raising the average wage for his work-ers from $2.34 to $5.00 per day. Although this made Ford known as the defender of the worker overnight, Ford’s motives were more complex. He believed that the more money he paid to workers, the more his cars would be bought. Although he paid his workers attractive salaries when they worked, he felt little re-sponsibility for their continued employment and laid them off when necessary.

During this early period, Ford instituted other worker benefits that were revolutionary. He created a Safety and Health Department in 1914 and opened the Henry Ford Trade School in 1916 so that boys could learn a trade while attending school. Another farsighted policy was the hiring of partially handi-capped workers, ex-criminals, epileptics, and former mental patients. In 1934, approximately 34% of Ford workers had a physically handicap.

Also instituted was the Ford Sociology Department that counseled workers and management alike. It gave workers advice on how to budget money and protected them when unscrupulous salesmen descended on them after they had received their paychecks. The Sociology Department also conducted a Language School to teach foreign-born workers spoken English. Labor appreciated his reforms and sup-

i Source: The Associated Press, “Chains Battle Speed Barrier,” The Clarion-Ledger, January 27, 2006.


ported Ford in his unsuccessful campaign for the U.S. Senate in 1918. Many experts feel that Ford’s re-forms were the only labor reforms in the early part of the century.

But Ford was inconsistent in his dealings with his workers. During the 1920s, Ford instituted a cost-saving campaign. Assembly line speed increased, forcing workers to perform their jobs in less time. Discipline was strict, and workers were driven to work as hard as possible. Even the Sociology Depart-ment was disbanded. The Ford Service Police, a 3,000-person group, was created to enforce the speed-up and other discipline measures. Workers who were involved in union activities were often physically as-saulted.

Ford, who was once hailed as the workers’ hero, was now viewed as a reactionary. During the Great Depression, layoffs in all industries resulted in massive unemployment. In March 1932, the Ford Hunger March took place. Several hundred workers marched on Ford, demanding a six-hour workday, two daily rest periods, and an unemployment bonus of $50 per man. The marchers were greeted by gun-fire that resulted in four deaths. Henry Ford steadfastly maintained a hostile attitude toward any union ac-tivities.

The Wagner Act was passed in 1935, establishing a national policy of protecting the rights of workers to organize and collectively bargain. Under the protection of the Wagner Act, the United Auto-mobile Workers began a systematic campaign to organize the automobile industry. By 1937, they had succeeded, except for Ford.

In May 1937, the UAW began its campaign to unionize Ford. Walter Reuther headed the cam-paign and planned to distribute circulars to Ford workers on their way home. The union members sta-tioned themselves on a bridge over a road leading to the Ford Rouge River plant. Ford Service Police or-dered them to leave, and when the union supporters started to comply, the police attacked them. The Bat-tle of the Bridge ended with Reuther and several others, including women, requiring hospitalization.

Even though Ford had prevented unionization yet again, time was running out. When the UAW began another organizing effort in 1941, they succeeded. After the head of the Ford Service Police fired eight Rouge River workers for union activities, the workers spontaneously walked off their jobs. They surrounded the plant and refused to let food and water be sent in to the Ford Service Police in the plant. On April 11, 1941, Henry Ford finally agreed to recognize the union.

LECTURE LINK 2-4

More on Theory Z

In the 1980s, Japanese companies seemed to be outperforming American businesses. William Ouchi, a management professor at the University of California Los Angeles, wondered if the secret to Ja-panese success was the way Japanese companies managed their workers. The Japanese management ap-proach (what Ouchi called Type J) involved:

lifetime employment consensual decision making collective responsibility for the outcomes of decisions slow evaluation and promotion implied control mechanisms non-specialized career paths holistic concern for employees

In contrast, the American management approach (what Ouchi called Type A) involved short-term employment


individual decision making individual responsibility for the outcomes of decisions rapid evaluation and promotion explicit control mechanisms specialized career paths segmented concern for employees

Type J firms are based on the culture of Japan, which includes a focus on trust and intimacy within the group and family. Conversely, Type A firms are based on the culture of America, which in-cludes a focus on individual rights and achievements. Ouchi wanted to help American firms adopt suc-cessful Japanese strategies, but he realized that it wouldn’t be practical to expect American managers to accept an approach based on the culture of another country. For example, a job for life in a firm may sound good – until you really think of the implications: no chance to change jobs and no opportunity to move up quickly through the ranks. Therefore, Ouchi recommended a hybrid of the two approaches in what he called Theory Z.

Theory Z blends the characteristics of Type J and Type A firms into an approach that involves long-term employment, collective decision making, individual responsibility for the outcomes of deci-sions, slow evaluation and promotion, moderately specialized career paths, and holistic concern for em-ployees (including family).

The theory views the organization as a family that fosters cooperation and organizational values. Today, economic decline, demographic and social changes, and fierce global competition have forced Ja-panese managers to re-evaluate the way they conduct business. Whereas the Japanese system of the 1980s was admired for its focus on building long-term business relationships, today there is a realization that Ja-panese firms need to become more dynamic and more efficient in order to compete effectively in the rapidly changing global economy.


CRITICAL THINKING EXERCISES

CRITICAL THINKING EXERCISE 2-1

Theory X or Theory Y?

Think of all the groups with which you have been associated over the years - sports groups, friendship groups, and so on. Try to recall how the leaders of those groups motivated the group to action.

1. Did the leaders assume a Theory X or a Theory Y attitude? Was this attitude successful or not? Why?

2. Which of these theories best describes you personally? Why?

3. Which managerial approach do you think would work best in each of the following work situa-tions? Why?

a. Highway maintenance crew?

b. Pharmaceutical research lab?

c. University English Department?

d. Oil refinery operating crew?


CRITICAL THINKING EXERCISE 2-2

Management Challenge

Antonio Lacosta is the plant manager at the North Monticello factory. He has always believed in the abilities of his department heads and let them share in decision making. The four department heads have each been with the company for over twenty years and are very loyal to the organization.

Lacosta called a meeting this morning to inform the department heads of a report just received from the home office. It seems that the North Monticello plant has the highest costs of the ten plants in the company and has fallen behind in production during the past eight months. This plant is one of the older plants, and the home office will be taking a close look at it. If costs can’t be brought under control and production increased by 15% within six months, the North Adams plant will probably be closed. Some senior workers may be transferred to other locations, but most employees will be terminated.

However, if new conditions are met, the company plans to spend over $40 million on new pro-duction equipment, and all jobs would be secure. As Lacosta indicated, “If we can do the job over the next six months, this plant will gain a new lease on life. But if we do not, we can expect the company to shut us down permanently. I would like each of you four, as my major department leaders, to call a meet-ing of your people today to inform them of this situation.”

1. What managerial approach do you think Lacosta was reflecting before the crisis? Why?

2. With the new information in the company report, how has the situation changed? How should this affect Lacosta’s management approach?

3. If you were one of the department heads, how would you present the new situation to your work-ers?


BONUS CASES

BONUS CASE 2-1

UPS Uses Scientific ManagementWith almost $48 billion in revenues and 246,000 employees in 200 countries and territories,

United Parcel Service (UPS) is the world’s largest package distribution company. Fortune magazine rates UPS as one of the most admired companies in the country. The company grew from a small bicycle mes-senger service in 1907 to today’s mammoth delivery service in part by dictating every task for its employ-ees. Drivers are required to step out of their trucks with their right foot, fold their money face up, and carry packages under their left arm. If a driver is considered slow, a supervisor rides along, prodding the driver with stopwatches and clipboards. To improve productivity to meet increased competition from other delivery services, UPS added 20 new services that required more skill. Drivers had to learn an as-sortment of new codes and billing systems and deliver an increasing number of time-sensitive packages that have special-handling requirements.

Drivers have long accepted such work requirements, taking comfort in good wages, generous benefits, and an attractive profit-sharing plan. All of this pressure, however, has taken its toll. Many UPS drivers have suffered from anxiety, phobias, or back strain, and at one point UPS had twice the injury rate of other delivery companies. UPS has spent nearly $1.5 billion since 1995 on improving health and safety programs. The total of days lost to disability has been on the decline.

To maintain its competitive advantage, UPS is using new technologies and better planning to achieve greater productivity without overloading employees. Competition from companies such as FedEx (where workers earn 30 to 50% less than UPS workers) also requires greater efficiency.

In the early 2000s, United Parcel Service spent $30 million to make its tracking and delivery sys-tem more efficient. One surprise finding: right turns improve efficiency. Now left turns are discouraged. Steve Goodrich, UPS Community Relations Mgr.: “One, they waste time. Two, it wastes fuel as we idle, waiting for those left turns to happen. And three, left turns are not as safe to make as right turns.”

It starts with the label on the package. Computer programs and GPS technology know where ev-ery package is and where they’re going. When it comes to the individual driver’s route, the computer plots which streets he’ll drive on. UPS can’t eliminate left turns entirely, but routing software is reducing the number as much as possible.ii

DISCUSSION QUESTIONS FOR BONUS CASE 2-1

1. Do you think eliminating left turns will really make a difference? How much?

2. Would you like working for UPS? Why or why not?

3. Can you think of another company that is still using scientific management?

ANSWERS TO DISCUSSION QUESTIONS FOR BONUS CASE 2-1

ii Sources: “America’s Most Admired Companies,” Fortune , March 7, 2005; “Package Flow Technologies: Innova-tion at Work,” www.ups.com; Harry R. Weber, “UPS Will Purchase Overnite Corp.,” St. Louis Post-Dispatch , May 17, 2005; and Caroline Sayre, “Make One Right Turn After Another,” Time, March 28, 2007.


http://www.ups.com/

1. Do you think eliminating left turns will really make a difference? How much?

Since the program was implemented in 2006, UPS drivers have reduced their miles driven by two million miles per month. For a company with a fleet of 88,000 vehicles on the road each day, that’s a big deal.

2. Would you like working for UPS? Why or why not?

This will be an individual decision. On the negative side, UPS employees have relatively little freedom to design their work environment. On the positive side, UPS pays significantly more than other delivery companies.

3. Can you think of another company that is still using scientific management?

Few companies still use scientific management, due to the opposition of employees and unions. It will be interesting to see if students can find any successful companies that still use it.


BONUS CASE 2-2

The Supermarket ManagerFred Ferrell is the store manager of the Right-Way Supermarket in Beaumont, a small suburban

area of some 1,300 families. The store’s staff consists of a produce manager, a meat manager and butcher, five checkers, four stockers, and a receiving clerk. The store operates six days per week from 9.00 a.m. until 9:00 p.m.

Last week Mr. Ferrell hired Amy Caldwell to replace the store’s receiving clerk. Since graduating from high school last June, Amy has worked for one other supermarket full-time. She applied for the job at Right-Way to gain new experiences and because the job paid $1 more per hour than she was making at the other store. Amy likes the retail food business and hopes one day to manage a store of her own. She plans to start school again next fall.

After two ten-hour days of training under Mr. Ferrell, Amy felt she knew the operation and pro-cedures well enough to proceed on her own. But Mr. Ferrell thought otherwise. For the rest of Amy’s first week, Fred Ferrell looked over Amy’s shoulder on a regular basis. It seemed that Amy couldn’t do any-thing without Ferrell’s checking it out for himself. Amy’s tasks included receiving, inspecting, arranging, and stacking inventory received from a central supply warehouse owned and operated by the parent com-pany. She was also responsible for the various inventory control procedures and related paperwork.

Over the weekend between her first and second weeks, Amy studied the inventory procedures and records. She roughed out a system for streamlining inventory handling and felt she had found a way to re-duce the amount of paperwork by combining several forms into one and using the computer system to print forms simultaneously. Amy felt if she could sell these proposals to Mr. Ferrell, not only his store, but all stores in the chain, could benefit. After some hasty calculations, she figured that nearly one hour per day would be saved and several hundred dollars in unnecessary forms could be eliminated.

Amy started work at 6:30 a.m. the following Monday, full of enthusiasm. When Mr. Ferrell ar-rived at 8:00 a.m., Amy was waiting for him at the door, her notes in hand. Before Amy could speak, however, Ferrell asked her what she was doing up front. Amy replied that she had already handled this morning’s deliveries and wanted to talk over a “proposal” with Mr. Ferrell. Ferrell then pulled a piece of paper out of his pocket and began to go over each item on this checklist with Amy. When he got to item 10 on the list, Amy replied that she would take care of that this afternoon. Ferrell told her to take care of it now. Amy tried again to explain that she had some ideas to speed up the receiving operation. Ferrell replied, “You kids are really something else. You’ve been here a week and already you’re running the place. What makes you think you know a better way? The procedures we use come from downtown. That is good enough for me. Now get to those cases out back.”

DISCUSSION QUESTIONS FOR BONUS CASE 2-2

1. What managerial approach is Mr. Ferrell using?

2. Amy has asked your advice. What would you suggest that she do? What are her alternatives?

3. What advice would you have for the general manager of Right-Way’s Supermarket parent corpo-ration?


ANSWERS TO DISCUSSION QUESTIONS FOR BONUS CASE 2-2

1. What managerial approach is Mr. Ferrell using?

He is applying the McGregor’s Theory X approach. It implies that the average person dislikes work and will avoid it if possible, and will avoid responsibility, with little ambition. Of course, he was wrong on all counts. This theory does work, but only with the kind of people who meet the description of disliking work and so forth.

2. Amy has asked your advice. What would you suggest that she do? What are her alternatives?

Note the timing of her approach to Ferrell; she met him at the door at 8:00 a.m. on Monday morn-ing. Could she have picked a worse time? Amy should wait until the appropriate time – most likely after work – to discuss her ideas with her boss. She should acknowledge the fact that some employees may prosper by merely following the rules, but that she is more ambitious than that and has some ideas. She may submit those ideas in writing so that the boss can implement them without losing face. If there is no response or a negative response to her suggestions, then, and only then, may she take them to a higher-level supervisor. Since this situation is far from unique, it should make for some lively class discussion.

3. What advice would you have for the general manager of Right-Way’s Supermarket parent corpo-ration?

Management training is a continuous process and managers who fail to adopt the best motiva-tional strategies need to be identified and given additional training or, if necessary, terminated. You could explain the newest concepts, such as employee empowerment, and the motivational techniques that go with them. Theory Y, for example, is much more appropriate for today’s more motivated and educated workers.


ENDNOTES


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