Chapter 1- Managing And Performing
Managing in a competitive world
Four ongoing challenges that characterize the business landscape:
• Globalization
• Technological change
• Knowledge management
• Collaboration across boundaries
Managing in a competitive world: globalization
• Interaction and integration of people, firms, and governments
• Many well-known enterprises are global, with offices and production facilities all over the world
• A company’s talent can come from anywhere => change of the workforce => role of expats
• Effect on both small and large companies
Managing in a competitive world: technological change
Web 1.0 (mid-1990s till early 2000s)
On-line consultation data, ‘reading’, dot.com companies and crisis
Web 2.0 (2005-2015)
Interactive, more user-friendly, consulting and sharing (video’s, photographs, …). Social media start-ups.
Web 3.0 (2015-…) ➔ Web 4.0 (highly intelligent interactions)
“read-write-execute” => Internet of Things (IoT)
• Real Time
• Artificial Intelligence
• Mobile Applications
• Big Data Analytics
• Cloud Computing
Technological Change: The Internet
The Internet provides a:
• Marketplace
• Means for manufacturing goods and services
• Distribution channel
• Information
The Internet:
• Drives down costs and speeds up globalization
• Improves efficient decision making
• Facilitates information flows and learning processes
Managing in a competitive world: knowledge management
Importance of strong idea and translation into innovation
Examples: entertainment, advertising, software, pharma
Knowledge workers: Use and create knowledge and information to develop ideas, and to signal and solve problems
Knowledge management: Finding, unlocking, sharing, and capitalizing on the most precious (i.e., intellectual)
resources of an organization, to convert ideas into innovation
• People’s expertise and skills
• Vision/creativity/wisdom
• Relationships
Managing in a competitive world: collaboration across boundaries
- Effective collaboration requires good communication between departments, divisions, and other units of
the organization
Example: T-shaped manager:
- Shares knowledge (horizontal) and remains committed to business unit (vertical) => broad and deep
perspective => knowledge across and within domains
,Example: Toyota bringing together design engineers and manufacturing employees
- Companies may capitalize on the ideas of people outside the organization e.g. consultants, advertising
agencies, suppliers, and clients
Example customer service: customer reviews Amazon, TripAdvisor
Managing for competitive advantage
Staying ahead of the competition by doing better than your competitors at doing valuable things = delivering
performance
Success drivers of performance
The best managers and companies deliver on multiple performance dimensions
Performance indicators Examples: turnover, profit, customer satisfaction, market share
• Innovation
• Quality
• Service
• Speed
• Cost Competitiveness
• Sustainability
Managing for competitive advantage: innovation
Innovation: the introduction of new technologies, processes, goods or services
A firm must:
• Adapt to changes in consumer demands and to new competitors
• Be ready with new ways to communicate with customers and deliver the products to them
• Innovate or die, products don’t sell forever
Managing for competitive advantage: quality
Quality: is a function of characteristics of goods or services.
Aim: excellence
Historically
• Emphasis on attractiveness
• Minimal defects
• Long-term reliability
Combined with:
First, quality check after product completion. Next, eliminate defects.
Today
• Preventing defects before they occur
• Achieving zero defects in manufacturing
• Emphasis on quality already in design-phase = Total Quality Management
• Continuous improvement (see the Japanese Kaizen):
Ongoing effort to improve products and processes. How? Cooperation, commitment, proactivity and creativity in
solving problems
Managing for competitive advantage: service and speed
Service
• Giving customers what they want or need, when they want it
• Continually meeting the needs of customers to establish mutually beneficial long-term relationships
• Making it easy and enjoyable for customers to experience or to buy and use products
Speed
Fast and timely execution, response, and delivery of results
Managing for competitive advantage: cost and sustainability
Cost competitiveness
Keeping costs low.
Relevance? To achieve profit maximization and offer attractive prices to consumers
Sustainability
Minimize the use of polluting, nonrenewable and nonrecyclable resources
Improve social conditions
Focus on the long term
Success drivers of competitive advantage (=> performance)
- Innovation, Quality, Service, Cost Competitiveness, Speed, Sustainability
, The four functions of management
Management entails:
Working with people and other resources to achieve organizational goals efficiently and effectively
Effectiveness: realizing the goal
Efficiency: realizing goals with minimal waste of resources = make of best use of money, people, time, materials
How? The four functions of management
1. Planning: delivering strategic value*
2. Organizing: building a dynamic organization
3. Controlling: learning and changing
4. Leading: mobilizing people
Value = value of good/service delivered to client
1. Planning
• Formulating goals to be achieved
• Developing strategies to achieve the goals
• Delivering strategic value
• The better you meet goals, the higher the value will be
Organizing
• Assembling and coordinating human, financial, physical, informational, and other resources needed to achieve the
goals
• Hiring of people, job descriptions, specifying responsibilities, allocating resources
Leading
• Stimulating/motivating people to be high performers
• Communicating and connecting with people
• In teams, departments, divisions
• Solving problems
Controlling
• Monitoring performance and making necessary changes
• Everything according to plan?
• Feedback: continually learning and changing, so goals can be realized
Performing all four management functions
• A typical day for a manager is not neatly divided into the four functions
• Days are fractionated and spent dealing with interruptions, meetings, and troubleshooting
• Good managers devote adequate attention and resources to all four management functions
Management levels and skills
Top-level managers are the senior executives of an organization and are responsible for its overall management.
Middle-level managers are located in the organization’s hierarchy below top-level management and above the
frontline managers. Sometimes called tactical managers, they are responsible for translating the general goals and
plans developed by strategic managers into more specific objectives and activities.
Frontline managers, or operational managers, are lower-level managers who supervise the operations of the
organization. These managers often have titles such as supervisor, team leader, or assistant manager.
Managerial roles: what managers do (Henry Mintzberg)
“Management is above all a practice where art, science and craft meet”,
Henry Mintzberg
Decision roles Informational roles Interpersonal roles
, • Entrepreneur • Monitor • Leader
Searching for new opportunities Seeking internal and external Staffing, developing, and
Starting new projects information for managing motivating people
the organization
• Disturbance handler Communication centre • Liaison
Taking corrective action during Maintaining a network of outside
crisis and other conflicts • Disseminator contacts that provide information
Transmits information among and favours
• Resource allocator employees
Providing resources for taking Interpreting and integrating • Figurehead
major decisions Perspectives Performing symbolic duties (legal,
social, …). Ex. events
• Negotiator • Spokesperson
Representing the organization Speaking on behalf of
(e.g., contracts, labour agreements) organization about plans,
policies, actions, and results
Must-have management skills
Soft and hard skills
Technical
Ability to perform a specialized task involving a particular method or process
Conceptual and decision
Ability to identify and resolve problems
Interpersonal and communication
People skills
Ability to lead, motivate, and communicate
You and Your Career
Emotional intelligence
The skills of understanding yourself, managing yourself, and dealing effectively with others
Social capital
Goodwill stemming from your social relationships
• Be both a specialist and a generalist
• Be self-reliant
• Connecting
• Actively managing your relationship with your organization
• Surviving and thriving
Exhibit 1.4 Two Relationships: Which Will You Choose?
We have noted the importance of taking responsibility for your own actions and your own career. Unless you are self-
employed and your own boss, one way to do this is to think about the nature of the relationship between you and your
employer. The exhibit shows two possible relationships—and you have some control over which relationship
develops.
Exhibit 1.5 Managerial Action Is Your Opportunity to Contribute
Managing in a competitive world
Four ongoing challenges that characterize the business landscape:
• Globalization
• Technological change
• Knowledge management
• Collaboration across boundaries
Managing in a competitive world: globalization
• Interaction and integration of people, firms, and governments
• Many well-known enterprises are global, with offices and production facilities all over the world
• A company’s talent can come from anywhere => change of the workforce => role of expats
• Effect on both small and large companies
Managing in a competitive world: technological change
Web 1.0 (mid-1990s till early 2000s)
On-line consultation data, ‘reading’, dot.com companies and crisis
Web 2.0 (2005-2015)
Interactive, more user-friendly, consulting and sharing (video’s, photographs, …). Social media start-ups.
Web 3.0 (2015-…) ➔ Web 4.0 (highly intelligent interactions)
“read-write-execute” => Internet of Things (IoT)
• Real Time
• Artificial Intelligence
• Mobile Applications
• Big Data Analytics
• Cloud Computing
Technological Change: The Internet
The Internet provides a:
• Marketplace
• Means for manufacturing goods and services
• Distribution channel
• Information
The Internet:
• Drives down costs and speeds up globalization
• Improves efficient decision making
• Facilitates information flows and learning processes
Managing in a competitive world: knowledge management
Importance of strong idea and translation into innovation
Examples: entertainment, advertising, software, pharma
Knowledge workers: Use and create knowledge and information to develop ideas, and to signal and solve problems
Knowledge management: Finding, unlocking, sharing, and capitalizing on the most precious (i.e., intellectual)
resources of an organization, to convert ideas into innovation
• People’s expertise and skills
• Vision/creativity/wisdom
• Relationships
Managing in a competitive world: collaboration across boundaries
- Effective collaboration requires good communication between departments, divisions, and other units of
the organization
Example: T-shaped manager:
- Shares knowledge (horizontal) and remains committed to business unit (vertical) => broad and deep
perspective => knowledge across and within domains
,Example: Toyota bringing together design engineers and manufacturing employees
- Companies may capitalize on the ideas of people outside the organization e.g. consultants, advertising
agencies, suppliers, and clients
Example customer service: customer reviews Amazon, TripAdvisor
Managing for competitive advantage
Staying ahead of the competition by doing better than your competitors at doing valuable things = delivering
performance
Success drivers of performance
The best managers and companies deliver on multiple performance dimensions
Performance indicators Examples: turnover, profit, customer satisfaction, market share
• Innovation
• Quality
• Service
• Speed
• Cost Competitiveness
• Sustainability
Managing for competitive advantage: innovation
Innovation: the introduction of new technologies, processes, goods or services
A firm must:
• Adapt to changes in consumer demands and to new competitors
• Be ready with new ways to communicate with customers and deliver the products to them
• Innovate or die, products don’t sell forever
Managing for competitive advantage: quality
Quality: is a function of characteristics of goods or services.
Aim: excellence
Historically
• Emphasis on attractiveness
• Minimal defects
• Long-term reliability
Combined with:
First, quality check after product completion. Next, eliminate defects.
Today
• Preventing defects before they occur
• Achieving zero defects in manufacturing
• Emphasis on quality already in design-phase = Total Quality Management
• Continuous improvement (see the Japanese Kaizen):
Ongoing effort to improve products and processes. How? Cooperation, commitment, proactivity and creativity in
solving problems
Managing for competitive advantage: service and speed
Service
• Giving customers what they want or need, when they want it
• Continually meeting the needs of customers to establish mutually beneficial long-term relationships
• Making it easy and enjoyable for customers to experience or to buy and use products
Speed
Fast and timely execution, response, and delivery of results
Managing for competitive advantage: cost and sustainability
Cost competitiveness
Keeping costs low.
Relevance? To achieve profit maximization and offer attractive prices to consumers
Sustainability
Minimize the use of polluting, nonrenewable and nonrecyclable resources
Improve social conditions
Focus on the long term
Success drivers of competitive advantage (=> performance)
- Innovation, Quality, Service, Cost Competitiveness, Speed, Sustainability
, The four functions of management
Management entails:
Working with people and other resources to achieve organizational goals efficiently and effectively
Effectiveness: realizing the goal
Efficiency: realizing goals with minimal waste of resources = make of best use of money, people, time, materials
How? The four functions of management
1. Planning: delivering strategic value*
2. Organizing: building a dynamic organization
3. Controlling: learning and changing
4. Leading: mobilizing people
Value = value of good/service delivered to client
1. Planning
• Formulating goals to be achieved
• Developing strategies to achieve the goals
• Delivering strategic value
• The better you meet goals, the higher the value will be
Organizing
• Assembling and coordinating human, financial, physical, informational, and other resources needed to achieve the
goals
• Hiring of people, job descriptions, specifying responsibilities, allocating resources
Leading
• Stimulating/motivating people to be high performers
• Communicating and connecting with people
• In teams, departments, divisions
• Solving problems
Controlling
• Monitoring performance and making necessary changes
• Everything according to plan?
• Feedback: continually learning and changing, so goals can be realized
Performing all four management functions
• A typical day for a manager is not neatly divided into the four functions
• Days are fractionated and spent dealing with interruptions, meetings, and troubleshooting
• Good managers devote adequate attention and resources to all four management functions
Management levels and skills
Top-level managers are the senior executives of an organization and are responsible for its overall management.
Middle-level managers are located in the organization’s hierarchy below top-level management and above the
frontline managers. Sometimes called tactical managers, they are responsible for translating the general goals and
plans developed by strategic managers into more specific objectives and activities.
Frontline managers, or operational managers, are lower-level managers who supervise the operations of the
organization. These managers often have titles such as supervisor, team leader, or assistant manager.
Managerial roles: what managers do (Henry Mintzberg)
“Management is above all a practice where art, science and craft meet”,
Henry Mintzberg
Decision roles Informational roles Interpersonal roles
, • Entrepreneur • Monitor • Leader
Searching for new opportunities Seeking internal and external Staffing, developing, and
Starting new projects information for managing motivating people
the organization
• Disturbance handler Communication centre • Liaison
Taking corrective action during Maintaining a network of outside
crisis and other conflicts • Disseminator contacts that provide information
Transmits information among and favours
• Resource allocator employees
Providing resources for taking Interpreting and integrating • Figurehead
major decisions Perspectives Performing symbolic duties (legal,
social, …). Ex. events
• Negotiator • Spokesperson
Representing the organization Speaking on behalf of
(e.g., contracts, labour agreements) organization about plans,
policies, actions, and results
Must-have management skills
Soft and hard skills
Technical
Ability to perform a specialized task involving a particular method or process
Conceptual and decision
Ability to identify and resolve problems
Interpersonal and communication
People skills
Ability to lead, motivate, and communicate
You and Your Career
Emotional intelligence
The skills of understanding yourself, managing yourself, and dealing effectively with others
Social capital
Goodwill stemming from your social relationships
• Be both a specialist and a generalist
• Be self-reliant
• Connecting
• Actively managing your relationship with your organization
• Surviving and thriving
Exhibit 1.4 Two Relationships: Which Will You Choose?
We have noted the importance of taking responsibility for your own actions and your own career. Unless you are self-
employed and your own boss, one way to do this is to think about the nature of the relationship between you and your
employer. The exhibit shows two possible relationships—and you have some control over which relationship
develops.
Exhibit 1.5 Managerial Action Is Your Opportunity to Contribute
