Study your flashcards anywhere!

Download the official Cram app for free >

  • Shuffle
    Toggle On
    Toggle Off
  • Alphabetize
    Toggle On
    Toggle Off
  • Front First
    Toggle On
    Toggle Off
  • Both Sides
    Toggle On
    Toggle Off
  • Read
    Toggle On
    Toggle Off

How to study your flashcards.

Right/Left arrow keys: Navigate between flashcards.right arrow keyleft arrow key

Up/Down arrow keys: Flip the card between the front and back.down keyup key

H key: Show hint (3rd side).h key

A key: Read text to speech.a key


Play button


Play button




Click to flip

48 Cards in this Set

  • Front
  • Back
Management - Definition
A group of people who undertake activities including planning, leading, organising and controlling, which aim to effectively and efficiently control company resources (and external resources) in order to meet organisational objectives as dictated in corporate vision and mission statements
Management Style - Definition
The way in which managers go about heir work and interact with people
Autocratic management style - Definition
A style of management in which the power and decision-making lies with management in terms of operations, policy, planning and task setting. The manager dictates what is to be done, and how it is to be done.
Persuasive management style - Definition
A style that follows the basic principles of autocratic management style but differs in that managers try to ‘sell’ to employees the decisions they have made.
Decision-making - Definition
The ability of a manager to collect and process relevant information to make a decision which will help the business to run effectively.
Consultative management style - Definition
A style characterised by the willingness of managers to consult with subordinates, an understanding of the importance of positive relationships with employees and a flatter management structure
Participative management style - Definition
A democratic style that allows employees to be part of the decision-making process.
Laissez-Faire Management style - Definition
A style in which the managers step back and let their workers decide how to achieve business goals.
Contingency management theory (situational approach) - Definition
Management theory which emphasises the need for the manager’s style to fit the circumstance. It maintains that there is no one formula for decision-making; rather, each situation must be looked at individually and decisions made for that situation alone
Communication - Definition
The transmission of information to one or more persons, in a way that ensures the recipient(s) understands the message
Formal communication - Definition
In an organisation, formal communication is the way information needed to run the business is sent successfully from sender to receiver.
Informal communication - Definition
The unofficial message or gossip that is passed between members of an organisation
Negotiation - Definition
The process of reaching an agreement through discussion and compromise
Delegation - Definition
The handing over of tasks, responsibility and authority to its employees by managers who in turn maintain accountability for the completion of the task
Stress - Definition
A disturbing physiological or psychological influence which produces a state of severe tension in an individual
Time management - Definition
The recognition by a manager that time is a finite resource and an acknowledgement that there is a need to plan time effectively
Team leadership skills - Definition
Those skills that the team leader (often a manager) must employ to ensure the team is managed effectively. Skills include coaching, encouraging, acknowledging and facilitating conflict management to enable the team to achieve business goals.
Esprit de corps - Definition
The spirit of an organisation to act as one in unity together and to support each other.
Stress Management - Definition
The ability of a manager to cope with stress and use it as a constructive rather than a destructive force in their working lives
Emotional intelligence - Definition
Emotional quotient [EQ]: The awareness of not only one’s own emotions but also of the emotions of others.
Ethical behaviour - Definition
Doing what is right; that is, what is fair, just and equitable.
Socially responsible behaviour - Definition
Creating a better quality of life for the greater common good or the most benefit and least harm for all stakeholders
Management styles - Styles of Management
Management styles can be determined by the following key points:

o Management styles can be seen to exist on a continuum from centralised (autocratic)
management to decentralised (laissez-faire).

o Centralised management is management focused and quite often task oriented

o Decentralised management is employee focused and more likely to be people oriented.
Autocratic Style - Styles of Management
o Associated with a hierarchical vertical management structure

o Decisions are made at top and then filtered down to lower management and employees who must curry them out

o The autocratic managers are hierarchical and authoritarian (make the decisions for their subordinates and tell them what to do)

o The Autocratic manager firmly believes the monetary reward should be enough of an incentive for the subordinate to complete work on time that is of an acceptable quality

o Praise is rarely offered to subordinate

o Criticism is frequently handed out

• Managers have a tendency to check up on employees to ensure that their tasks are being carried out correctly and to the manager’s satisfaction

o Managers of this style do not deviate from policy and procedure; they also expect their subordinates to do the same

o Rarely motivates employees and often causes poor morale

• Employees often feel the manager has little or no faith in them and does not trust them.

• As a result of this lack of trust, it is unlikely that employees will place a great deal of trust in each other

o It can be hard for employees to find job satisfaction when working under an autocratic style management

• This results to the acceptance that employees will not perform at their full potential

o Autocratic management style (in the past) suited smaller factories where the owner had the entrepreneurial vision and business acumen (skill) to identify a need in the market and satisfy it

• Traditionally, there was often a great deal of unquestioned respect for and fear of authority

• This style still exists in organisations where the founder is still the CEO (E.g. Rupert Murdoch’s News Corporation and Frank Lowy’s Westfield Shopping Centres)

o Autocratic management can also be used in a company which has a great number of inexperienced and poorly skilled employees

• This style can work well if employees need a lot of direction, are unsure in taking initiative and need skills development.

• But it is ineffective for staff that have been working the same job for a longer period of time, as they can already use their initiative to know what is expected of them.
Persuasive Management - Styles of Management
o Centralised decision-making and control at the management level

o Persuasive style is different from autocratic as the managers will communicate decisions to employees in detail

o A persuasive manager will try to get an employee to agree to management decisions

o Once an employee believes that a management decision is good for the organisation, they often support decision and feel it is theirs

o Communication is more open, But it still flows from the top down

o Management is happy to communicate decisions to employees, but is not willing to invite employees to be a part of the decision-making process

o Sell: The persuasive management style is broken down into two categories:

o Hard sell: Often involves coercion and rewards (e.g. Threat of losing job for non-compliance or promising bonuses for compliance with decisions)

o Soft sell: Involves building a relationship with employees, encouraging empathy for management (The employees put themselves in management’s shoes) and fear for the survival of the business

• Soft sell techniques appeal to the emotions of employees – asking them to identify with the decision, even though communication and other decisions have come from the top down

o In instances of takeovers and restructuring, managers employ persuasive techniques to hold on to their best employees who might leave rather than risk being retrenched.
Consultative Management - Styles of Management
• Managers and directors consult with employees to find out their views and opinions before they ultimately make the final ‘informed’ decision

• Consultative management is based on the view that collective intelligence creates better solutions than individual intelligence

o This effect is referred to as group synergy, when the result is greater than the contribution of sum of individuals

• Two-way communication channel – Indicated by the idea that the manager consults the employees before making decisions

• Employees who work under consultative management feel valued – This feeling of value exists because employees feel that their ideas and opinions are listened to and that they have an opportunity to contribute to decision-making

• Open environment which maintains good morale and motivation – As a result of the consultative approach
Important Skills: To be successful, a consultative manager needs to have a range of important skills which they can employ effectively.

• Very good listeners – Who can create a trusting environment which employees can feel safe to express their ideas

• Ability to integrate and synthesise ideas – To come up with relevant and realistic solutions that support the business goals and directions with the information provided by employees

• Ability to ensure employees don’t feel unappreciated or withdrawn – Managers will listen to all ideas and opinions but may not be able to use all ideas and must not make employees feel rejected
Implementing consultative management: There are a variety of ways a consultative manager can approach their work:

• Good communication channel – which allow employees to store their opinions and their knowledge easily

o E.g. suggestion boxes, regular employee meetings, staffrooms mixed with management and employees

• Flatter, more horizontal organisational structure – Fewer levels of management and fewer barriers to the opinions of staff being heard

• Employees may become confused about their role in the decision-making process – Difficulties can arise when decisions need to be made without consultation as it is not always appropriate to involve employees in all decisions (E.g. employee promotion)
Participative management - Styles of Management
• Democratic management style

• Managers actively invite employees to make the decisions themselves – similar to consultative style.

Origins and Development:

• Theorist Mary Parker Follet stressed the need for organisations to come up with ‘common goals’ for their staff – She encouraged managers to allow employees to participate in decision-making

• Behavioural Management Theory – Identified employees as human beings (NOT robots) who had experience in their work and a valuable contribution to make to the running of the business

• Management style recognises these views and makes staff a fundamental part of decision-making

• Participative management style doesn’t extend to all parts of the business – Is usually confined to employees’ area of work

• Horizontal management structure facilities (makes easy) this management style – As it allows the organisation to work in groups (groups are essential for this style)

• Managers do not withdraw from the decision-making process – they are actively involved as they join employees to make important decisions rather than dictate the decisions

• High level of trust is placed in employees under the participative style

o Managers must recognise the skills and knowledge already possessed by employees – They also must provide training programs for employees to ensure they can make effective and informed decisions
Identifying Features

• Decentralised decision-making process – managers share information with employees and jointly come up with solutions to problems (the process is Collegial)

• Communication flows up and down the organisation – not just from the top down

• Management is people focused

• Managers facilitate rather than lead – managers give up power and delegate authority to employees

• Employees operate together in self-directed and self-organised groups and teams – Which take responsibility for the completion of tasks

Benefits and costs: Benefits are particular from staff point of view:

• Employees feel safe – and free to speak without fearing repercussions or changes to their employment status

• Employees are motivated and feel self-empowered – As their views and their decision-making skills are regarded as important

• Increased staff loyalty – Employees are able to identify with the business and feel part of the team

• Higher production and quality of goods and services - Employees take greater pride in their work as there is a greater commitment from staff.

Criticisms: Similar to Consultative style criticisms:

• Participative managers are criticised in circumstances when decisions need to be made quickly

• Employees may also feel uncertain about their roles, due to the lack of clear-cut direction of authority from managers
Laissez-Faire - Styles of Management
• Means ‘To leave well enough alone’

• Completely employee focused

• Managers barely interfere – They set objectives and goals for employees and leave them to it

• The ‘hands off’ approach is because the CEO believe that after hiring the right person for the job, they can leave them to get on with their tasks – Not because the CEO is lazy

Laissez-faire managers:

• Allow employees to sort out how to achieve their key business indicators (KBIs)

• Feed information to employees and act as a support only

• Provide tight and regular deadlines, with regard to achieving results and monitoring progress, which must be met

• Empower employees so they are highly motivated and gain great job satisfaction

• Allow employees to have a wider scope for the development of individual talents, initiatives and creative thinking

• This type of management style often works with highly skilled employees who are project focused

o Also where businesses employ people who work from home – Thus managers cannot be present to check that tasks are being carried out
Contingency management (situational approach) - Styles of Management
Effective managers vary their style of management according to their circumstances or situation (E.g. in times of bankruptcy, there is little time for consultation or participative management as decisions need to be made quickly)

• A contingency is something that is undecided but depends on the situation

o As business is always changing, it is also assumed that the manager’s approach must also change

• Assumes that there are Multi-styled managers with the ability to change management styles in a given situation

• Also assumes that the manager is able to recognise or read the situational factors that determine appropriate management style to apply

These factors include:

o The organisation (goals, objectives, culture)

o The manager themselves

o The employees

o The situation or task

o The internal and external influences

o In reality, contingency management is the most appropriate style of management and takes the best of all the styles as it recognises that businesses are constantly changing

o Other management styles imply that people and businesses only operate one way which is a naïve way to think.
Communication - Key Skill in Effective Management
• In management, is used to send and receive messages to and from senior management, peers, subordinates and internal/external customers

• Most communication in a business involves the giving and receiving of information needed to run the business

• If the communication system is not effective, the business will not run efficiently as they cannot meet their strategies and goals as the employees may not be clear to what is expected of them

• Can be informal or informal and take place in a verbal or non-verbal way

• Formal communication is the official information that is necessary to run the organisation effectively

• Business conferences, business meetings, appointments and briefings

• Managers must ensure that formal communication is understood by employees

• Informal communication refers to the unofficial message being communicated

• Informal communication can highlight what is happening in a business and whether employees are focused on their work tasks

• This communication is referred to as gossip and takes place in informal settings (e.g. lunch or during coffee breaks)

• An effective manager will pay careful attention to both forms of communication
Verbal communication - Communication - Key Skill in Effective Management
Involves any communication using written words or speech

o Formal Verbal Communication occurs during meetings conferences, appraisals and interviews

o Informal Verbal communication occurs during lunch and through gossip and networking

o Oral communication

• Often Time wasting – Usually when a formal agenda has not been set or an agenda is too broad

• E.g. Meetings are notorious for running overtime and for not reaching conclusions

• Organised verbal communication can be extremely effective – A well organised seminar or conference can be very effective to pass information onto a defined audience

• It’s main advantage over written communication is that oral communication encourages feedback

o Written communication

• Memos, faxes, emails, contracts, diary entries, letters

• 2 Main Problems:

• Written communication doesn’t encourage feedback

• Difficult to convey tone in written communication [especially in emails]


• Problematic when copies aren’t kept - A letter or note that has been written can get lost

• Feedback is often slow – People may not retrieve their messages often (Email and online chat are making this less of a problem)

• Main advantage: Provides a permanent record of what has been agreed upon, dictated and passed on

• Preferred choice for business

o Horizontally Structured

Organisations will have one or two levels of communication – The message is likely to get to all recipients intact

o Vertically Structured Organisations will have lots of layers – Risk passing on a message that is no longer intact

• Written communication is the safest option in the vertical structures for important information

o Sending a form of written communication following a form of oral communication

• Effective managers will send messages to staff confirming what was discussed and any action points following a meeting they just had.
Non-verbal communication - Communication - Key Skill in Effective Management
o Often considered insignificant: Doesn’t include the use of written or spoken words

o Even more important that verbal communication – It includes body language, tone of voice, image and setting – This convey the true feeling or a person

Body language:

• Negative and unresponsive – Crossing arms and legs

• Open Body language – Suggests that the person is warm, friendly and open to new ideas

Tone of voice:

• Indicator of emotion and reactions – Allows recognition of interest, disinterest, sarcasm, amusement


• Dress and presentation – Shows how the person wants to be seen and identified as


o Informal or formal – Restaurant or cafes can create a friendly atmosphere, Conferences or meetings can create a serious atmosphere
Cross-cultural Communication - Communication - Key Skills in Effective Management
o Globalisation has meant that more business will be conducted across shore and off shore

o Critical to stable and successful relationships - The ability to communicate effectively and in a culturally sensitive manner

o The necessities of understanding another country’s culture becomes more apparent when the values and beliefs of the culture are vastly different to our own

o A good manager will understand the differences in a culture and business practice – before conducting a business relationship with another country.

o E.g. In Hong Kong, it is customary to use two hands when handing over a business card – It is considered very rude and ignorant if you offer the card with one hand
Effective Communication - Communication - Key Skills in Effective Management
An effective manager will employ a variety of skills and techniques to promote effective communication:

o ‘Listen to’ rather than ‘Hear’

o Actively listening to the opinions of superiors and employees – Allows a manager to form accurate opinions, make effective decisions and promote employee morale

Visual clues and questioning for clarification:

o Eye contact and nodding – Managers will look for this to indicate whether the person is receiving and understanding the message being communicated

o Over telephone – Interest level can be picked up via the tone of voice – This indicates that they are receiving the message

o Experienced communicators will also get feedback and check if the receiver has understood the message correctly – By asking questions
Touching Base

o Good managers often greet employees each morning – Walking around the office or leaving door open to say hello to employees as they arrive each morning

Two-way communication:
o The giving and receiving of feedback helps managers ensure their message has been received and understood

Awareness of non-verbal communication:

o Managers should be aware of the non-verbal communication cues that convey to their audience and the non-verbal communication cues that are conveyed to them

Time and place:

o ‘There is a time and place for everything’ applies to business

o It may not be appropriate to criticise an employee in the presence of their co-workers or firing an employee over the phone

Managing by wandering around (MBWA):

o A very useful communication tool – Similar to touching base

o Creates open and warm relationship - Involves the manager communicating with the employees on an informal basis

o Obtains information from employees about the tasks they undertake and their opinions on various work-related tasks
Management styles and communication - Communication - Key Skills in Effective Management
Effective managers use a variety of formal, in-formal, verbal and non-verbal communication:

o Laissez-faire managers tend to wander around the office – to create a relaxed atmosphere

o Participative managers are usually active listeners and tend to create an open atmosphere – creates a non-confrontational feeling

o Consultative managers are also very good listeners and good at structuring questions – Unlike participative, these managers tend to use more formal methods of communication (questionnaires, meetings)

o Persuasive managers are very good at presenting their arguments (with the use of visual aids) – Large conferences and meetings to present formal communication
Negotiation - Key Skills in Effective Management
o Conflict in opinions and views is an inevitable part of running a business

o Negotiation is the process of trying to find solutions to overcome conflict and is essential for effective management

o Conflicts are destructive to a business – It prevents strategies from being implemented to achieve goals. (Because the conflicting parties pull in opposite directions)

o Industrial action may take place as a result of conflict – this can ruin a business

o Building blocks for a good negotiator:

o Creating a trusting/relaxed atmosphere – Attempt to gain trust from both parties and eases the threat they feel

o Outline the reasons for meeting/objective

o Clarify arguments of both sides – Pay attention to both sides of the argument to make sure everyone understands the issues

o Look for close common ground in minor issues

o Create a ‘give and take’ attitude – Persuade each party to give something up in return for gaining something – Called trade offs

o Look for a WIN-WIN outcome and get written agreement signed by both parties – So that each party feels a sense of achievement and doesn’t lose face

o Set strategies as to how the solution will be implemented – Usually a time frame is set to implement the agreement

o Follow up to check that the solution has been implemented as agreed
Delegation - Key Skills in Effective Management
o Frees managers time

o Horizontal structures – Delegation in this structure is more possible as there are no levels between the manager and employee – Easier for the manager to keep an eye on the employee

o Involves the manager handing over the planning, implementation and completion of a task to the employee

o Usually not the entire responsibility is handed over – because managers are paid to ensure that the goals are achieved

o Key management skill: Only effective managers can guide another person to complete a task

o Is necessary for:

o Career planning: Providing opportunities for employees to gain experience in completing tasks that will enable them to move up the career ladder (Otherwise able employees will become bored and leave the business)

o Stress management: Effective managers control their stress through periods when they have very heavy workloads – by prioritising tasks and delegating less important tasks to others. (If this isn’t done, their health and immune systems will suffer from extensive exposure to stress and will not be able to operate efficiently)

o Management absences: Managers must implement structures which enable the department to continue functioning in the short-term without them – as they take annual leave and go on holidays

o Delicate process of an effective manager:

1. Assess the risks
2. Prepare the ground thoroughly
3. Set firm boundaries

Managers must be Careful to:

o Select employees – who will be able to successfully complete the task

o E.g. employee who has previously observed on a similar task

o Ensure the employee understands the task – They should take time to give a detailed briefing of the task and provide guidelines for the employees to follow

o Create timelines – Ensure that any resources needed for the completion of the task are in place and that there is a realistic timeline for the employee to follow

o Performance indicators – Make the employee aware of any performance standards that exist for the task, so the employee knows what is expected of them

o Check performance – Periodically check to see how the progress is unfolding and build up a trusting environment – So that the employee could admit if things were not going to plan

o Managers may also use the informal ‘grape-vine’ method to get feedback from other employees as to how the task is being performed

o Debriefing – The manager should provide feedback to the employee about their performance against the standards – This gives the employee a chance to discuss the aspects they enjoyed and found challenging

o Reward – Some reward is necessary otherwise employees would hesitate to take on new challenges for fear of risking their careers

o Laissez-faire management – Everything is delegated on the assumption that the right person has been chosen to complete the task – with checks and balances along the way

o Participative management also involves a lot of delegation
Time management - Key Skills in Effective Management
o Managers must recognise that time is a finite resource – Thus acknowledging the need for planning of effective time use

o 4 major steps for planning effective time management:

1. Identifying tasks to be achieved

2. Delegating easier tasks

3. Prioritising tasks

4. Developing an action plan
Do's for Managers - Key Skills in Effective Management

1. Review corporate gaols and objectives and establish a priority or ‘to do’ list

2. Schedule time that cannot be interrupted for certain tasks – This should be a time that the manager will work at their best

3. Leave some time unscheduled for emergencies

4. Schedule planned meeting and arrange time around them

5. Undertake difficult tasks first – Many managers waste hours doing easier tasks to avoid difficult ones

6. If a task is too difficult, break it down into a series of smaller tasks – Sometimes smaller tasks are easier as it brings a sense of achievement earlier

7. Delegate

8. Only handle a piece of paper once – Many people pick something up, put it down, then re-read it – This wastes time

9. Learn to say ‘no’ – Managers should learn to say ‘no’ to extra tasks given from the boss as he/she is likely to be displeased if the task cannot be completed due to poor time management

10. Plan tomorrow’s activities today
Don'ts for Managers - Key Skills in Effective Management

1. Don’t fail to plan – ‘Failing to plan is planning to fail’

2. Don’t be a slave to telephone interruptions – Time should be allocated for making and receiving calls

3. Don’t be the victim of a lack of information – Managers should not set out to complete a task and then start searching for the information with which to complete it – Any research required to complete a task should be done before the task is commenced

4. Don’t be managed by crisis – ‘Fire fighting’ is not an effective management strategy, as decisions are not made in a rational and controlled environment

5. Don’t be the victim of a communication breakdown – Managers should ensure time is managed effectively by clarifying the tasks that have been asked of them – Then clearly communicating the requirements/resources of any tasks they intend to delegate

6. Don’t go to a meeting unprepared or call a meeting without setting an agenda – Unplanned meetings tend to run overtime

7. Don’t procrastinate – ‘Why put off ‘till tomorrow what you can do today?’ – Don’t look for excuses to not do things as it doesn’t get the job done

8. Don’t be ignorant of subordinates – Some subordinates may be too busy to handle a delegated task, some may not be trained, some may have little work and could handle more

9. Don’t delay decisions – This affects the time management of both the manager and other employees – As there is less time available to complete the task

10. Don’t handle a piece of paper more than once – Read it, action it and file it – Double handling wastes a great deal of time
Team Leadership
• The more modern businesses converting to flatter structures, the more important team leadership skills are for the modern manager

• Teamwork and Team leadership are critical concepts in today’s management

o Teams can operate as a management team, functional team or a cross-functional team

• Team leadership is an essential management skill – As being able to involve all relevant employees in finding solutions to serious problems is far better than just relying on a manager’s ability to do this alone
Management skills of a Team Leader - Team Leadership
• A good team manager will attempt to bind the group together and create an esprit de corps – a spirit of unity and support – Through introducing badges, uniforms or even special logos to be printed on pens and notepads to create a sense of unity

• These skills include the ability to:

o Function as a coach rather than a boss

o Encourage contributions from all team members

o Manage team relationships

o Acknowledge team effort

• When working in a team, an effective team leader should:

o Create a common purpose

o Identify roles for each member

o Affirm members’ contributions

o Set deadlines

o Facilitate and clarify goals to keep them on track
Emotional Intelligence - Key Management Skill
• Measured as an Emotional quotient (EQ):

o The suggestion (Daniel Goleman, 1990) that our view of intelligence was too narrow and that our emotions play an important role in areas such as decision-making and individual success

• Emotional intelligence is the ability to:

o Understand one’s own emotions (be self-aware)

o Self-manage (control impulses)

o Be socially aware (understand and empathise)

o People who have strengths in these areas were suggested would become the next ‘stars’ of the business world

• Important in teamwork

o Each team member needs to be able to listen to other members of the team, understand others’ opinions, be aware of their own feelings and make effective decisions after considering each of these aspects

• 4 Progressive steps to managers developing emotional intelligence:

o Self awareness – Becoming aware of their own values, motivations and state of emotional health

o Self-management – Learning to manage their own emotions and impulses

o Social awareness – Becoming aware of others’ emotions and differences – Developing the ability to sense, understand and empathise with others

o Relationship management – Developing the ability to use the knowledge of the emotional dimension of a person to inspire, influence, motivate and build bonds and consensus

o Goleman believed that managers could be taught how to develop these skills in a similar way to therapists helping dysfunctional people break destructive behaviour patterns

• A good manager who is in touch with their own emotions and the positive/negative effects they have on their functioning – Can realise that harnessing the emotional positive power of the people they work with can create better results than ignoring it

o If an employee is shouted at publicly, they are likely to lie or blame others and not bother making an effort any more – This can cause destructive attempts to make any project fail

• Acknowledging how someone feels is a common counselling tool – It helps take the heat out of the situation by letting the employee know that they are understood

• An Emotionally intelligent manager is able to help employees work to the best of their abilities
Self: Self awareness Self management

Social: Social awareness Relationship management
Strategic Planning - Key Management Skill
Key Skill of management is the ability of senior management to have the long-term vision – where the business should be in 5-10 years.
• These plans must be ready for change – By predicting any occurrence, the business has been gets an advantage over its competitors
• In cases of a sudden crisis’s – plans have to be moderated and resources must be channelled to areas of growing interest in the market
o Many managers use the PEST method to understand the ‘big picture’ of their Political, Economic, Socio-Cultural and Technological environment
Problem Solving and Decision-making - Key Management Skill
• Managers are faced with small decisions that are made spontaneously - When bigger issues occur, there is a more formal process of problem solving and decision-making needed:

o Most managers of all management styles – Autocratic, Persuasive, Consultative, Participative, Laissez-faire – will apply a particular method:
Models of Decision-making (7D's) - Problem Solving and Decision-making - Key Management Skill
• Define the problem:

o Management must be clear about what they are solving or achieving

o Involves asking ‘Whether the problem is even a problem’

• Discover the causes:

o This can take a great deal of time for a complex issue – but it is critical for finding a solution

o All information should be researched – Can be done using the FIBS – ‘Find information blind spots’

• E.g. If a company was looking at introducing a computer system – They would ‘find information’ on all the systems available but the ‘blind spots’ might be the costs of repairing possible breakdowns of the new system on old computers

• Develop Solutions:

o Brainstorming is a useful tool – finding solutions quick is a major difficulty

• Grouping random solutions in categories or themes allows managers to find structure to a solution to the ‘big picture’

• Differentiate Solutions:

o A PMI chart– Plus, Minus, Interesting – may be used to assess and compare each solution

• Decide on a solution

o Emotional intelligence may be used to decide upon final decisions – Employees may feel comfortable with one option more than the other

• Do it:

o The solution is developed into an action plan of tasks

o The tasks are distributed among the employees, along with a time line for completion

• The solution that has been chosen as the best possible outcome may not be the smoothest to implement

• E.g. When involves training employees in new methods or the use of new equipment – This is why involving employees in the decision-making process helps to gain their commitment for implement the change

o Effective managers will give support, encouragement and extended time to overcome this new steep learning curve if the new method is to succeed

• Discern Success:

o Evaluate the effectiveness of the solution – and consider amendments that could be made

o The solution is rarely abandoned:

• But does happen when the seven steps were not followed through properly or something came from left field which changed the dynamics of the problem altogether.

• E.g. The GFC may have prevented the business from borrowing enough funds to implement the solution.
Ethical Behaviour and Social Responsibility
• Ethical Behaviour is about fairness and ‘doing the right thing’ – acting with honesty, equity and respect for people’s rights

• Socially Responsible Behaviour involves acting in a way that will create the most benefit and quality of life for all stakeholders – Internal and external

• Milton Friedman (1970s) believed that businesses were behaving socially responsibly if they simply made the highest profit they could – As this created the most income for society

o Since then, Organisations such as Greenpeace and Oxfam have provided society with new expectations on how businesses should behave – The workforce and community are now ‘green’ educated

• The Corporate Responsibility Index is voluntary and involves companies self-assessing how they incorporate responsibility.

o This acts as a guideline and allows measuring and reporting on the impacts an organisation has on society and the environment.
Consequences of unethical behaviour - Ethical Behaviour and Social Responsibility
• Divided into 3 categories:

o Financial (Heavy fines – Governments have brought in strict laws)

o Personal (Imprisonment and personal disgrace)

o Societal (customer boycott of products and/or shares)