What is Management?
Introduction to Management
Pavel Adámek
Management

Outline of the lecture
• The importance of management
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•Essential Managerial Tasks
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•Levels and Skills of Managers
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•Recent Changes in Management Practices
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Learning objectives
After studying this chapter, you should be able to:
1.Describe what management is, why management is important, what managers do, and how managers use
organizational resources efficiently and effectively to achieve organizational goals.
2.
2.Distinguish among planning, organizing, leading, and controlling (the four principal managerial
tasks), and explain how managers’ ability to handle each one affects organizational performance.
3.
3.Differentiate among three levels of management, and understand the tasks and responsibilities of
managers at different levels in the organizational hierarchy.
4.
4.Distinguish among three kinds of managerial skill, and explain why managers are divided into
different departments to perform their tasks more efficiently and effectively.
5.
5.Discuss some major changes in management practices today that have occurred as a result of
globalization and the use of advanced information technology (IT).
6.
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The importance of management
Managing a company is a complex activity, and effective managers face many challenges from within
and outside their organizations.
•Management is an unpredictable process.
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•Making the right decision is often difficult, and even successful managers often make mistakes.
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•But the most effective managers learn from their mistakes and continually try to find ways to
improve their companies’ performance.

What is management?
•When you think of a manager, what kind of person comes to mind?
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•Do you think of an executive helps direct company?
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•Or do you see a manager at a fast-food restaurant, who deals directly with employees and
customers, or the person you answer to if you have a part-time job?
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•What do all these people have in common?

What is management?
•Firstly, they all work in organizations!
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Organizations are collections of people who work together and coordinate their actions to achieve a
wide variety of goals or desired future outcomes.
•Second, as managers, they are the people responsible for supervising and making the most of an
organization’s human and other resources to achieve its goals.
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•Management, then, is the planning, organizing, leading, and controlling of human and other
resources to achieve organizational goals efficiently and effectively.
–An organization’s resources include assets such as people and their skills, know-how, and
experience; machinery; raw materials; computers and information technology; and patents, financial
capital, and loyal customers and employees.

Achieving High Performance: A Manager’s Goal
Source: G. R. Jones, J. M. George, 2019. Contemporary Management, p. 5
Efficiency, Effectiveness, and Performance in an Organization
•High-performing organizations are efficietnt and effective.

Achieving High Performance: A Manager’s Goal
•Efficiency is a measure of how productively resources are used to achieve a goal.
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•Organizations are efficient when managers minimize the amount of input resources (such as labor,
raw materials, and component parts) or the amount of time needed to produce a given output of goods
or services.
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–For example, Burger King develops ever more efficient fat fryers that not only reduce the amount
of oil used in cooking, but also speed up the cooking of french fries.
–UPS develops new work routines to reduce delivery time, such as instructing drivers to leave their
truck doors open when going short distances.

Achieving High Performance: A Manager’s Goal
•Effectiveness is a measure of the appropriateness of the goals that managers have selected for the
organization to pursue and the degree to which the organization achieves those goals.
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•Organizations are effective when managers choose appropriate goals and then achieve them.
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–Some years ago, for example, managers at McDonald’s decided on the goal of providing breakfast
service to attract more customers. The choice of this goal has proved smart. Over recent years,
sales of breakfast food accounted for more than 30% of McDonald’s revenues. In 2015, in an effort
to increase sales, McDonald’s management decided to offer breakfast items all day long, a strategy
that has been successful and well received by customers.
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!!!Effective managers are those who choose the right organizational goals to pursue and have the
skills to utilize resources efficiently!!!

Why study management?
•The dynamic and complex nature of modern work means that managerial skills are in demand.
•Organizations need individuals like you who can understand this complexity, respond to
environmental contingencies, and make decisions that are ethical and effective. Studying management
helps equip individuals to accomplish each of these tasks.
•By studying management in school, you are exposing yourself to the lessons others have learned.
The advantage of such social learning is that you are not bound to repeat the mistakes others have
made in the past.
•By studying and practicing the behaviours of good managers and high-performing companies, you will
equip yourself to help your future employer succeed.
•The economic benefits of becoming a good manager are also impressive. (In the United States,
general managers earn a median annual wage of $97,730, with a projected growth rate in job openings
of 5% to 8% between now and 2024.)
•Finally, learning management principles can help you make good decisions in nonwork situations. If
you’re coaching a child’s soccer team, organizing a charity, planning your financial budget, or
starting a new business, good management principles will help you understand others, make quality
decisions, and improve your overall personal success.
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Essential Managerial Tasks
The job of management is to help an organization make the best use of its resources to achieve its
goals.
•How do managers accomplish this objective?
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•They do so by performing four essential managerial tasks: planning, organizing, leading, and
controlling.
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•French manager Henri Fayol first outlined the nature of these managerial activities around the
turn of the 20th century in General and Industrial Management, a book that remains the classic
statement of what managers must do to create a high-performing organization.

Essential Managerial Tasks
Source: G. R. Jones, J. M. George, 2019. Contemporary Management, p. 5
The arrows linking these
tasks in Figure suggest the sequence in which managers typically perform them.
4 Tasks of Management

Essential Managerial Tasks - Planning
•To perform the planning task, managers identify and select appropriate organizational goals and
courses of action; they develop strategies for how to achieve high performance.
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•The three steps involved in planning are (1) deciding which goals the organization will pursue,
(2) deciding what strategies to adopt to attain those goals, and (3) deciding how to allocate
organizational resources to pursue the strategies that attain those goals.
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•How well managers plan and develop strategies determines how effective and efficient the
organization is—its performance level.
•Planning strategy is complex and difficult, especially because planning is done under uncertainty
when the result is unknown so that either success or failure is a possible outcome of the planning
process. Managers take major risks when they commit organizational resources to pursue a particular
strategy.

Essential Managerial Tasks - Organizing
•Organizing is structuring working relationships so organizational members interact and cooperate
to achieve organizational goals.
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•Organizing people into departments according to the kinds of job-specific tasks they perform lays
out the lines of authority and responsibility between different individuals and groups.
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•Managers must decide how best to organize resources, particularly human resources.
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•The outcome of organizing is the creation of an organizational structure, a formal system of task
and reporting relationships that coordinates and motivates members so they work together to achieve
organizational goals.

Essential Managerial Tasks - Leading
•An organization’s vision is a short, succinct, and inspiring statement of what the organization
intends to become and the goals it is seeking to achieve—its desired future state.
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•In leading, managers articulate a clear organizational vision for the organization’s members to
accomplish, and they energize and enable employees so everyone understands the part he or she plays
in achieving organizational goals.
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•Leadership involves managers using their power, personality, influence, persuasion, and
communication skills to coordinate people and groups so their activities and efforts are in
harmony.
•Leadership revolves around encouraging all employees to perform at a high level to help the
organization achieve its vision and goals. Another outcome of leadership is a highly motivated and
committed workforce.

Essential Managerial Tasks - Controlling
•In controlling, the task of managers is to evaluate how well an organization has achieved its
goals and to take any corrective actions needed to maintain or improve performance. For example,
managers monitor the performance of individuals, departments, and the organization as a whole to
see whether they are meeting desired performance standards.
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•The outcome of the control process is the ability to measure performance accurately and regulate
organizational efficiency and effectiveness.
–To exercise control, managers must decide which goals to measure—perhaps goals pertaining to
productivity, quality, or responsiveness to customers—and then they must design control systems
that will provide the information necessary to assess performance—that is, determine to what degree
the goals have been met.
•The controlling task also helps managers evaluate how well they themselves are performing the
other three tasks of management—planning, organizing, and leading—and take corrective action.
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Levels and Skills of Managers
To perform the four managerial tasks efficiently and effectively, organizations group or
differentiate their managers in two main ways—by level in hierarchy and by type of skill.
•We differentiate managers according to their level or rank in the organization’s hierarchy of
authority.
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•The three levels of managers are first-line managers, middle managers, and top managers—arranged
in a hierarchy.
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•Typically first-line managers report to middle managers, and middle managers report to top
managers.
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•Organizations group managers into different departments (or functions) according to their specific
job-related skills, expertise, and experiences, such as a manager’s engineering skills, marketing
expertise, or sales experience.
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Levels and Skills of Managers
•A department, such as the manufacturing, accounting, engineering, or sales department, is a group
of managers and employees who work together because they possess similar skills and experience or
use the same kind of knowledge, tools, or techniques to perform their jobs. Within each department
are al three levels of management.
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Image result for departments structure example Image result for departments structure example

Levels and Skills of Managers
Source: G. R. Jones, J. M. George, 2019. Contemporary Management, p. 5
Organizations normally have three levels of management:
1.first-line managers,
2.middle managers, and
3.top managers.
Levels of Managers

Levels and Skills of Managers
•Managers at each level have different but related responsibilities for using organizational
resources to increase efficiency and effectiveness.
•At the base of the managerial hierarchy are first-line managers, often called supervisors. They
are responsible for daily supervision of the nonmanagerial employees who perform the specific
activities necessary to produce goods and services. Firstline managers work in all departments or
functions of an organization.
–Examples of first-line managers include the supervisor of a work team in the manufacturing
department of an auto plant, the head nurse in the obstetrics department of a hospital, and the
chief mechanic overseeing a crew of mechanics in the service function of a new car dealership.
•Supervising the first-line managers are middle managers, responsible for finding the best way to
organize human and other resources to achieve organizational goals. To increase efficiency – to
find ways for better use resources. A major part of the middle manager’s job is developing and
fine-tuning skills and know-how.
–Which first-line supervisors should be chosen for this particular project?
–Where can we find the highest quality resources? How should employees be organized to allow them
to make the
–best use of resources?

Levels and Skills of Managers
•Top managers are responsible for the performance of all departments. They have cross-departmental
responsibility.
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•Top managers establish organizational goals, such as which goods and services the company should
produce; they decide how the different departments should interact; and they monitor how well
middle managers in each department use resources to achieve goals.
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•Top managers are ultimately responsible for the success or failure of an organization, and their
performance is continually scrutinized by people inside and outside the organization, such as other
employees and investors.
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Levels and Skills of Managers
•The chief executive officer (CEO) is a company’s most senior and important manager, the one all
other top managers report to.
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•Today the term chief operating officer (COO) refers to the company’s top manager, such as Tim
Cook, who was groomed by Steve Jobs to take over as Apple’s CEO.
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•Together the CEO and COO are responsible for developing good working relationships among the top
managers of various departments (manufacturing and marketing, for example); usually these top
managers have the title “vice president.”
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Managerial Skills
•Both education and experience enable managers to recognize and develop the personal skills they
need to put organizational resources to their best use.
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•Research has shown that education and experience help managers acquire and develop three types of
skills: conceptual, human, and technical.
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1.Conceptual skills are demonstrated in the general ability to analyze and diagnose a situation and
to distinguish between cause and effect. Top managers require the best conceptual skills because
their primary responsibilities are planning and organizing.
–Formal education and training are important in helping managers develop conceptual skills.
–Today continuing management education and training, including training in advanced IT, are an
integral step in building managerial skills because theories and techniques are constantly being
developed to improve organizational effectiveness, such as total quality management, benchmarking,
and cloud computing and virtual business-to-business (B2B) networks.
–In addition, organizations may wish to develop a particular manager’s abilities in a specific
skill area—perhaps to learn an advanced component of departmental skills, such as international
bond trading, or to learn the skills necessary to implement total quality management.

Managerial Skills
2.Human skills include the general ability to understand, alter, lead, and control the behavior of
other individuals and groups. The ability to communicate, to coordinate, and to motivate people,
and to mold individuals into a cohesive team distinguishes effective from ineffective managers.
–Human skills can be learned through education and training, as well as be developed through
experience.
–To manage personal interactions effectively, each person in an organization needs to learn how to
empathize with other people—to understand their viewpoints and the problems they face.
–One way to help managers understand their personal strengths and weaknesses is to have their
superiors, peers, and subordinates provide feedback about their job performance.
3.
3.Technical skills are the job-specific skills required to perform a particular type of work or
occupation at a high level. Examples include a manager’s specific manufacturing, accounting,
marketing, and increasingly, IT skills. Managers need a range of technical skills to be effective.
–Managers and employees who possess the same kinds of technical skills typically become members of
a specific department and are known as, for example, marketing managers or manufacturing managers.
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Managerial Skills
!!!Managers are grouped into different departments because a major part of a manager’s
responsibility is to monitor, train, and supervise employees so their job-specific skills and
expertise increase!!!
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Managerial Skills
•Today the term core competency is often used to refer to the specific set of departmental skills,
knowledge, and experience that allows one organization to outperform its competitors.
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•In other words, departmental skills that create a core competency give an organization a
competitive advantage.
–Dell, for example, was the first PC maker to develop a core competency in materials management
that allowed it to produce PCs at a much lower cost than its competitors—a major source of
competitive advantage.
–Google is well known for its core competency in research and development (R&D) that allows it to
innovate new products at a faster rate than its competitors. From computerized glasses to
self-driving cars, Google continues to pioneer the development of technology for the masses.
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Types and Levels of Managers
Source: G. R. Jones, J. M. George, 2019. Contemporary Management, p. 16

Managerial Skills
•Effective managers need all three kinds of skills—conceptual, human, and technical—to help their
organizations perform more efficiently and effectively. The absence of even one type of managerial
skill can lead to failure.
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•One of the biggest problems that people who start small businesses confront, for example, is their
lack of appropriate conceptual and human skills. Someone who has the technical skills to start a
new business does not necessarily know how to manage the venture successfully.
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•Developing new and improved skills through education and training has become a priority for both
aspiring managers and the organizations they work for.
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•Many people are enrolling in advanced management courses; but many companies, such as Microsoft,
GE, and IBM, have established their own colleges to train and develop their employees and managers
at all levels.

Recent Changes in Management Practice
Two major factors that have led to these changes are global competition and advances in information
technology.
•Top managers are encouraging lower-level managers to look beyond the goals of their own
departments and take a cross-departmental view to find new opportunities to improve organizational
performance.
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•Technology gives managers at all levels and in all areas access to more and better information and
improves their ability to plan, organize, lead, and control.
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•IT also gives employees more job-related information and allows them to become more skilled,
specialized, and productive.

Recent Changes in Management Practice
•To utilize IT to increase efficiency and effectiveness, CEOs and top management teams have been
restructuring organizations and outsourcing specific organizational activities to reduce the number
of employees on the payroll and make more productive use of the remaining workforce.
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•Restructuring involves simplifying, shrinking, or downsizing an organization’s operations to lower
operating costs, as companies such as Microsoft and Macy’s have been forced to do.
–The global recession of 2008–2010 forced most companies—large and small, profit and nonprofit—to
find ways to reduce costs because their customers were spending less money, so overall revenues
decreased.
–Restructuring can be done by eliminating product teams, shrinking departments, and reducing levels
in the hierarchy, all of which results in the loss of large numbers of jobs of top, middle, or
first-line managers, as well as nonmanagerial employees.
–IT makes it possible for fewer employees to perform a particular work task. IT increases each
person’s ability to process information and make decisions more quickly and accurately.
–Restructuring, however, can produce some powerful negative outcomes. It can reduce the morale of
remaining employees, who worry about their own job security.

Recent Changes in Management Practice
•Outsourcing involves contracting with another company, usually in a low-cost country abroad, to
have it perform a work activity the organization previously performed itself, such as
manufacturing, marketing, or customer service.
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•Outsourcing increases efficiency because it lowers operating costs, freeing up money and resources
that can be used in more effective ways—for example, to develop new products.
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–Low-cost global competition dramatically increased outsourcing at the beginning of 2000. In 2015,
nearly 2.4 million U.S. jobs were outsourced to other countries. India, Indonesia, and China were
rated as the best outsourcing countries.
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–Large for-profit organizations today typically employ 10% to 20% fewer people than they did 10
years ago because of restructuring and outsourcing. Ford, IBM, AT&T, and DuPont are among the
thousands of organizations that have streamlined their operations to increase efficiency and
effectiveness.
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–At the same time, many companies continue to experience outsourcing problems in Asia, including
increasing wages in that part of the world. Automakers, in particular, are looking for venues that
offer both skilled workers and low wages.

Empowerment and Self-Managed Teams
•The second principal way managers have sought to increase efficiency and effectiveness is by
empowering lower-level employees and moving to self-managed teams.
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•Empowerment is a management technique that involves giving employees more authority and
responsibility over how they perform their work activities.
–The way in which John Deere, the well-known tractor manufacturer, empowered its employees - who
assemble Deere’s vehicles possess detailed knowledge about how Deere products work.
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–Deere’s managers realized these employees could become persuasive salespeople if they were given
training. So groups of these employees were given intensive sales training and sent to visit
Deere’s customers and explain to them how to operate and service the company’s new products. While
speaking with customers, these newly empowered “salespeople” also collect information that helps
Deere develop new products that better meet customers’ needs.
•Often companies find that empowering employees can lead to so many kinds of performance gains that
they use their reward systems to promote empowerment.

Empowerment and Self-Managed Teams
•IT also facilitates the use of a self-managed team, a group of employees who assume collective
responsibility for organizing, controlling, and supervising their own work activities.
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•Using IT designed to give team members real-time information about each member’s performance, a
self-managed team can often find ways to accomplish a task more quickly and efficiently.
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•Moreover, self-managed teams assume many tasks and responsibilities previously performed by
first-line managers, so a company can better utilize its workforce.
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–First-line managers act as coaches or mentors whose job is not to tell employees what to do but to
provide advice and guidance and help teams find new ways to perform their tasks more efficiently.
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–Using the same IT, middle managers can easily monitor what is happening in these teams and make
better resource allocation decisions as a result

RECAP
•Organizations are collections of people who work together and coordinate their actions to achieve
a wide variety of goals or desired future outcomes.
•The four managerial tasks—planning, organizing, leading, and controlling—are essential parts of a
manager’s job. At all levels in the managerial hierarchy, and across all jobs and departments in an
organization, effective management means performing these four activities successfully—in ways that
increase efficiency and effectiveness.
•Efficiency is a measure of how productively resources are used to achieve a goal.
•Effectiveness is a measure of the appropriateness of the goals that managers have selected for the
organization to pursue and the degree to which the organization achieves those goals.
•Managers do by performing four essential managerial tasks: planning, organizing, leading, and
controlling.
•Both education and experience enable managers to recognize and develop the personal skills they
need to put organizational resources to their best use.
•
•
•

RECAP
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•Research has shown that education and experience help managers acquire and develop three types of
skills: conceptual, human, and technical.
•
•Managers are grouped into different departments because a major part of a manager’s responsibility
is to monitor, train, and supervise employees so their job-specific skills and expertise increase.
•
•Two major factors that have led to these changes are global competition and advances in
information technology.
•
•Recent Changes in Management Practice: outsourcing, empowerement, self-managed Teams.
•
•