Managers and Managing 5
Managing today’s organizations is a complex affair, and seasoned lead-
ers like Scott Parish face multiple challenges from within and outside of
their organizations. To make decisions and lead others successfully,
managers must possess a complex set of skills, knowledge, and abilities that help them inter-
pret cues from the environment and respond accordingly.
In this chapter we consider what managers do and the skills, knowledge, and abilities they
must possess to lead their organizations effectively. We also identify the different kinds of
managers that organizations rely on to help guide them. Finally, we consider some of the
challenges that managers must overcome to help their organizations prosper.
When you think of a manager, what kind of person comes to mind? Do
you think of an executive like Scott Parish, who helps direct his com-
pany? Or do you see a manager at a fast-food restaurant, who engages
directly with employees and customers? Perhaps you think of a foreman
at a manufacturing company? Regardless of how we view managers,
they all share important characteristics. First, they all work in organizations.
Organizations
are collections of people who work together and coordinate their actions to achieve a wide
variety of goals or desired future outcomes.
4 Second, as managers, they are the people respon-
sible for supervising and making the most of an organization’s human and other resources to
achieve its goals.
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; machin-
ery; raw materials; computers and information technology; and patents, financial capital, and
loyal customers and employees.
Achieving High Performance:
AManager’sGoal
One of the key goals that organizations try to achieve is to provide goods and services that
customers value and desire. Scott Parish’s principal goal is to manage Alcon so that it creates
a continuous stream of new and improved entertainment content—enjoyable films, televi-
sion shows, and music—that customers are willing to buy. Like other entertainment compa-
nies, Alcon also seeks projects that have potential to grow into film or television franchises,
encouraging repeat business. Likewise, the principal goal of fast-food managers is to produce
tasty and convenient food that customers enjoy and come back to buy. Finally, manufactur-
ing managers must balance the quality needs of their consumers against the pressure to be
cost-effective.
Organizational performance is a measure of how efficiently and effectively managers
use available resources to satisfy customers and achieve organizational goals. Organizational
performance increases in direct proportion to increases in efficiency and effectiveness, as
Figure1.1 shows. What are efficiency and effectiveness?
Efficiency is a measure of how productively resources are used to achieve a goal.
5 Orga-
nizations 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. For example, McDonald’s 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.
To encourage efficiency, Scott Parish has changed the way Alcon compensates many of
its actors. Previously, film production companies paid actors using guaranteed compensation
and without consideration of a movie’s success. They would recoup the cost of making a
movie only if it had adequate performance at the box office. Unfortunately, that meant film
producers like Alcon held all of the risk.
Overview
What Is
Management?
organizations Collections
of people who work together
and coordinate their actions
to achieve a wide variety
of goals or desired future
outcomes.
management The planning,
organizing, leading, and con-
trolling of human and other
resources to achieve organi-
zational goals efficiently and
effectively.
LO1-1
Describe what management
is, why management is
important, what managers
do, and how managers use
organizational resources
efficiently and effectively to
achieve organizational goals.
organizational
performance A measure of
how efficiently and effectively
a manager uses resources to
satisfy customers and achieve
organizational goals.
effi ciency A measure of
how well or how productively
resources are used to achieve
a goal.