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ADMON E INNOVACION EN MODELOS DE NEGOCIOS

Pensamiento de la admnistracion e importancia de la innovacion en lo negocios de las nuevas generaciones.
by

Daniel Zarate

on 31 December 2013

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Transcript of ADMON E INNOVACION EN MODELOS DE NEGOCIOS

Lecturer: Daniel Zarate
ADMINISTRATION AND INNOVATION
applied to business models

two different meanings , however related in all the possible ways

why?.......

without innovation in science, medicine and other fields of human studies no evolution could take place... HENCE ....
not any economical growth and no need of any administration to organize new structures...
administration and Innovation
applied to business models

Understanging the classic theories of ADMINISTRATION

Review the SRATEGY theory

Gattering a broad view of the ORGANISATION theory

INNOVATION as a management responsability

analyze the global environment of BUSINESS

DECISION making

And finally the construction of an INNOVATIVE BUSINESS MODEL which allows the student to compete in the fast cycle BUSINESS environment that we are facing nowadays.
This course will be addressed from a
GLOBAL VISION perspective..
understanding all the happenings

locally and internationally



to set a better box of tools in our portfolio
HOW GOOD IS YOUR
GLOBAL VISION???
De que depende la posicion competitiva de una empresa???
1.- ADMINISTRATION THEORY
1.1 Scientific Administration
En las economías hay una enorme variedad de empresas compitiendo en muchas industrias cuyas ganancias dependen de una infinidad de factores y variables.
CUALES??????
Dependen de la combinacion de variables y se agrupan en tres;
EMPHASIS ON TASKS

the name of scientific management is due to:

-the attempt to apply the methods of science to the problems of the administration, in order to achieve high industrial efficiency-
The main scientific methods applicable to problems of administration are:

observation and
measurement
The school of scientific management was initiated at the beginning of last century by the American mechanical engineer

Frederick W. Taylor
Taylor workshops systems main contributions:

1. - Taylor felt that the administrator had to stop improvising and behave as foreman so he can distinguish responsibilities.
2. - Said that the administrator in order to LEAD, needs to know more than their subordinates in the technical aspect of the job so he can direct their efforts
3.- Taylor is the father of the "control , preparation and planning principle"
4.- He measured the time it took for a worker or machine to finish a process and with this he established standards of time
5. - Implementation of methods to manage the efforts of workers
6. - Implementation of selection, training and supervision to set better staff of workers.
7. - Implementation of incentives and wages that would reduce tensions between the manager and employee
ADVANTAGES OF TAYLOR WORKSHOPS

1. - Implanted the concept of research
2. - Deployed the use of standards in manufacturing
3. - Established manufacturing processes
4.- Implementation of controls
5. - Established cooperation between employees
DISADVANTAGES OF TAYLOR'S THEORY:

1.-He thought that his application would always be on a stable environment
2. Its principles are very general and its application is limited to organizations of certain complexity
3. - He did not consider the worker as a human being but as a complement of machines
4. - Had not considered the human aspects related to their job satisfaction and other needs of man as social being.
1.- Ambiente economico, politico y cultural
2.- Las ciudades y
localizaciones
geograficas donde
la empresa se
establece
3.- Estructura Interna
de la
empresa



The Gilberths---behavioral method

Mayo----recognizes the work as a personal achievement. motivation

Follett:----Individual and group motivation

Shelson----companies as a group of humans and not as a group of machines

Barnard----organisational structure
Gantt------- bonus for work

Munstenberg -----psychology to choose the fittest worker

Scott: ------marketing and motivation

Emerson -----efficiency and avoid waste

Person: -----administration as academic disiplins
OTHER CONTRIBUTIONS TO SCIENTIFIC MANAGEMENT
F.W. TAYLOR, 1856–1915
"as a good engineer he took scientific direction "

He was obsessed with planning process and control

Mr Taylor used to say to his workers;
"You are not supposed to think. There are other people paid for thinking around here"

"In the past man has been first; in the future the system must be first"
leading theorist:
HENRY FAYOL
2. ADMINISTRATION PROCESS THEORY
what was Fayol's intention:

the search of the administrative system to teach it in all universities
to apply this knowledge to all forms of human effort, enterprise, home, business, government.
(Born in Estambul, 1841 - París, 1925)
Engineer and theorist of business administration.
Founder of the classical theory of management.
lived in Constantinople in a wealthy family.
lived the consequences of the industrial revolution and later the First World War
FAYOL DIVIDED THE INDUSTRIAL ACTIVITY IN 6 DIFFERENT FUNCTIONS ;

TECHNICAL
1. - PRODUCTION
2. - MANUFACTURING
3. - ADAPTATION

BUSINESS
1. - SHOPPING
2. - SALES
3. - EXCHANGE

FINANCIAL
1. - SEARCH
2. - USEFUL USE OF CAPITAL
WHAT IS THE ORGANISATION ACCORDING TO FAYOL;

a dual structure ...
...human and material
to achieve the goals that are agreed
SCHOOL OF ADMINISTRATIVE PROCESS

objectives are met through organized groups in the company
analyzes the right process through the administrator's responsabilities
SCHOOL OF HUMAN BEHAVIOR

his study focuses on interpersonal relations since the administration process is right through people
is based on the principle that "people should understand people" to carry out its objectives

MOTIVATION comes as an important management tool
SCHOOL OF SOCIAL SYSTEMS

the administration is deployed as a sociological phenomenon which seeks to identify the nature of cultural relations between various social groups and integrate them as a system.

father of this school CHESTER BARNARD
SCHOOL OF THE THEORY OF DECISION

It focuses on the rational solutions making the analysis of processes and
identifies the people who take part in the decision

who makes the decision?
why?
what is your sphere of influence?
SCHOOL OF MATHEMATICS MANAGEMENT

administration is seen as a matemathical model system
therefore as the administration, organization, planning and decision-making is a logical process ...

....then can be expressed in mathematical terms.
who is he...

1. - Division of labor
2 - Authority and responsibility
3. - Discipline
4. - Unity of Command
5. - Unity of direction
6. - Subordination of individual interests to general
7. - Remuneration of staff
8. - Centralization
9. - String scalar
10. - Order
11. - Equity
12. - Staff stability
13. - Initiative
14. - Team spirit
according to Buendia (2011), the only contribution of Fayol was that all organizations require a certain degree of planning / organization / direction and control.
however it was up until Fayol this knowledge was organized and documented to be able to educate masses for its implementation in business and management.
what is efficiency for Taylor?
is the result of knowing exactly what is expected to do from the employees ...... and then make sure they do it in the best possible way in the most economical prctice.
SECURITY
1. - PROTECTION OF PROPERTY
2. - PERSONS


ACCOUNTING
1. - INVENTORIES
2. - BALANCE SHEET
3. - COSTS
4. - STATISTICS

ADMINISTRATIVE
1. - PLANNING
2. - ORGANIZATION
3. - DIRECT
4. - COORDINATION
FAYOL AS THE FOUNDER OF THE CLASSICAL SCHOOL OF BUSINESS ADMINISTRATION WAS THE FIRST TO SYSTEMATIZE MANAGERIAL BEHAVIOR AND MADE 14 PRINCIPLES OF ADMINISTRATION
After Taylor's contribution for administration at a workshops and factory level and Fayol's with a more administrative process and management aproach..

a cascade of authors arrived with more contributions to these two basic learnings ..

Acoording to Buendia (2011) we defined 6 schools of the administration thought:
EMPIRICAL SCHOOL

analyze cases
is based on applying experience of successful cases

what is its weakness?

each firm produces a different experience with multi -variants that can not be applied to all companies
1994
1998
2004
ECONOMICS DEGREE

MBA
MASTER OF ECONOMIC
DEVELOPMENT
PhD IN ECONOMY
CEO of a corporation with 11,000 employees
4th biggest cinema company in the world with 2,550 theaters and 1000 more to set by 2015 in India and Brasil
One common thing...
EDUCATION

to understand better the business speed....
How important is to have and grow a GLOBAL VISION
the two business models
that have changed the way companies deploy administration and innovation
organizational charts become more creative and sophisticated
APPLE
GOOGLE
Summarazing...
SCIENTIFIC THEORY
standarazig time and
movement at work
men treated as a machine
administration is more important than manufacturing
automation demerit the value of humans
MANAGEMENT PROCESS
provides activities and responsabilities of the administrator
he goes enside how business work and give more importance to this structuration than to the administrator
what are the classification for the generations??

which generation you are into??
Gen Boomers
Gen X
Gen Y
Gen M or D
What is the new American dream?

Does the economy make it possible for everyone to achieve it?
According to Dan Shawbel, entrepreneur and columnist at Forbes Magazine;

The new American Dream is about having AN INTERESTING life rather than a happy life.

The Dream is shifting on two fronts;

For one thing, in the US the idea of the American Dream and happiness is actually about money – achieving more than your parents did.
But Generation X is the first generation that will not earn as much as their parents, and the same will be true for generations to come.
As the international economy shifts, the US economy is shifting away from increasingly lavish lifestyles.
At the same time, psychologists have been doing a lot of research about what makes people happy. And the most surprising result is that;

75% of our happiness is determined at birth.

We have a happiness set point, much like we have a set point for how much we weigh. And we keep going back to that spot.

So you are born thinking the glass is half-empty or half-full. And you are born feeling content or feeling like you always want to do better.
So it’s very frustrating to try to change how happy you are.
Can you describe what the new work relationship is?
Work is about continual learning and feeling engaged at a deep level.

A good job is one that addresses your core strengths and pays a living wage for what you do.

Work is a way to support a life full of engagement and learning.

You don’t need work to meet all your needs, but you need work to support a life where you meet your needs.


How is this can you explain this statement....
What does the jerk want?
Power? Doughnuts? Money for doughnuts? Your parking spot? Attention? A bunch of unearned respect? It does not matter. Jerks rarely want to change the world or create something beautiful. Jerks want to get things. Non-jerks want to do things. Focus on doing, and avoid becoming a jerk yourself.
Learning From Jerks.
Know someone who’s nasty, bitter, racist, sexist, lazy, lying, stealing, rude, two-faced, or obviously a sociopath? Of course you do. Jerks are everywhere. Just the thought of one can kill your mood, your appetite, and your enthusiasm for anything associated with that nefarious character. But you can learn a lot from a jerk.
What is that jerk’s problem?
Unloved as a child? Lost in an abyss of painful emotion? Confused? Feverish? Or simply lacking a moral compass? Not all jerks are beyond hope. A lot of them just need a little kindness, understanding, and patience. Jerks are, after all, people. So give the jerk a little help. Only if he’s proved his jerkiness to be a chronic condition, should you stop helping—at that point, that jerk is just taking advantage of you.
INNOVATION FOR TURBULENT TIMES
Chapter 1.

What is INNOVATION?
MAIN OBJECTIVES OF
THE COURSE
from the Latin word innovatus,
which is the noun form of innovare
"to renew or change,"
Therefore....
is the creation of better or more effective
products, processes, services, technologies, or ideas
that are readily available to
markets, governments, and society
what's the difference between

INVENTION IMPROVEMENT
invention refers more directly to the creation of the idea or method itself...

whereas innovation refers to the use of better and, as a result, novel idea or method
improvement is doing the same thing better.

innovation refers to the notion of doing something different...
WHY IS IMPORTANT?
In a hyper competitive global environment companies must innovate;
MORE & FASTER
WHY
So the innovation in products, services, management systems, production processes, corporate values and other aspects of the organization keep being competitive in a real time
what is an organization?
a social entity that is;

1.- goal directed

and

2.- deliberately structured

this definition applies to all organizations
profit and non-profit ones.
how do organizations get this results??
thru MANAGEMENT
what is it??
is the attainment or achievement of organization goals in an
effective
and
efficient
manner through

4 management functions..
PLANNING
ORGANIZING
LEADING
CONTROLLING
select goals and the ways
to tackle them
Assign responsibility for
task accomplishment
Use influence to motivate
employees, persuade
Monitor activities and
make corrections
WHAT IS

EFFECTIVE

EFFICIENT
the degree to which the organization achieves a stated goal.
the use of minimal resources -raw materials, money and people to produce a desire volume of output
IN OTHER WORDS.....
Let's comeback to MANAGEMENT....
we have 3 facts:
1.- all organizations need managers to succeed
2.- good managers get things done (no excuses)
3.- managers have executive functions responsible for building and coordinate rather than do specific tasks
4.- good managers create systems and conditions that enable others to perform those specific tasks.
J . YANG
D. FILO
J. DORSEY
M. ZUCKEMBER
S. BRIN
L.PAGE
HIGH
?????
HOW YOU THINK ADMINISTRATION
WAS CREATED??

WHAT WAS THE FIRST BUSINESS CONCEPTION??

CAN YOU PICTURE IN HISTORY 3 DIFFERENT
BLOCKS OF NECESSITIES FOR ADMINISTRATION??
POTTERY
SHOES
CLOTHING CONFECTION
BC AD
WHY IS SO IMPORTANT
ROME??
POLITICS/ SENATE/ REPUBLIC
STATE OF LAW
ROMAN ENGINEERING
AQUEDUCTS/ARCHS/STREETS
HOME OF CHRISTIANITY
BIGGEST IMPIRE EVER...SO
administration was recorded in documents of all assets, tributes, taxes, happenings etc..
Beginning of 2 important operational terms:

logistics and strategy
A SECOND HISTORY BLOCK: MERCANTILISM
BETWEEN XII AND XVII
INDUSTRIAL REVOLUTION
XVIII - XIX
RAILROAD PRINTER
WORK IN MASS
DEVELOPMENT OF NEW CITIES
PRODUCTS MOR REACHABLE
MASS MOVEMENT (PEOPLE)
EXPLOSION OF NEW GEOGRAPHICAL ZONES
DISSEMINATION OF INFORMATION
MORE KNOWLEDGE
MORE INTENTION FOR PEOPLE TO GAIN WELLNESS
MORE AMBITION
LES REPRESSED PEOPLE BY IGNORANCE
RAISING SOCIAL MOVEMENTS
AUTOMATION OF MASS PRODUCTION
best example FORD (line T)
3rd Block:
the internet Bum
Policies, rules and criteria are detailed at PAGE 1 in Black Board -BB-

however lets review the most important agreements:
Assistance;
Class is at 10 am
sharp!!!!
(in case I arrive 10 MINUTES late one day you all gain a one time late entrance opportunity) and so forth.
remember that punctuality is part of your business formation -no excuses-

DOOR WILL BE CLOSED ONCE I AM IN THE CLASSROOM
NO PHONES
NO LAPTOPS (unless required by me or by BB instructions)
NO TOILET (please go before class, some exception for women)
NO FOOD ( perhaps some water or drinks only)

Please be advised that if you are seen using your telephone you will leave the class with and absence
NO EXCUSES
ASSIGNMENTS

all assignments should be delivery
on time.

please refer to page one to see which cases
you may apply for exceptions and read instructions
We will use our names in classroom since we are going to behave as we are working in a corporation
with professional approach and respect

This is not an English class.... so
NO DISRESPECT WILL BE TOLERATED
for the accent or mistakes while speaking in English of others
EVALUATIONS CRITERIA

PARTIAL GRADES

PARTIAL EXAM 60%
TEAM WORK (activities and assignments) 20%
INDIVIDUAL WORK (quick tests and essays) 20%

FINAL GRADE SUMMARY

PARTIAL EXAMS SUMMARY 50%
FINAL TEST 20%
FINAL PROJECT BMCanvas 20%
Entrepreneurship workshop (2 workshops, 5% (each)10%

please refer to PAGE 1 to clarify all doubts
my summary
Daniel Zarate de Avila
Studies:
Major International Commerce at TEC
Major in Law at UNIVA
MBA (master in business administration) at La Trobe Uni in Melbourne Australia
LLM (Master in International Law in global business law) at La Trobe Uni,Melbourne Australia
Work Experience

start up my own business at 23 years old after the entrepreneurship program at TEC
sold that company 2 years later 3 times its price
made up another bigger and stronger and gain the leadership at the market
sold the company 10 years later with 100 employees and great revenues
went to Australia, study and relax for a while
got a job as a corporate lawyer in Sydney
after 5 years came back home
I am a corporate consultant you can reach me at my web page
global-vision.mx
as a boy made $4,000 usd a month delivering newspaper



how?



he created a system whereby he hired and coordinated others to help deliver rather than simply delivering what he could on his own.
PERFORMANCE
The organization ability to attain its goals by using resources in an effective and efficient way
MANAGEMENT SKILLS
CONCEPTUAL
HUMAN
TECHNICAL
TO PERFORM THE 4 MANAGEMENT FUNCTIONS:
PLANNING
ORGANIZING
LEADING
CONTROLLING
MANAGEMENT AT THE NEW WORK PLACE
THE RULES CHANGE WHY????
new technology

globalization

shifting social values
how?
Characteristics

technology
work
workforce

management competencies

leadership
doing work
relationship
new work place

digital
flexible, virtual
empowered, diverse



empowering
by teams
collaboration
old work place

mechanical
structured, localized
loyal, homogeneous



autocratic
by individuals
conflict,competition
MANAGER ROLES

Henry Mintzberg organize 10 different roles
MONITOR:
seek and receive information,
scan periodically and reports
DISSEMINATOR:
phones calls, memos
forward info.
spokesperson:
transmit info to outsiders
thru speeches, reports, memos
FIGUREHEAD:
symbolic duties,
signing legal papers
LEADER:
direct and motivate
subordinates
LIAISON:
maintain info links outside
and inside
ENTREPRENEUR:
iniciate improvement projects
identify new ideas,
delegate idea responsibility to others
DISTURBANCE HANDLER:
take corrective action,
resolve conflicts,
adapt to environmental crisis
RESOURCE ALLOCATOR:
decide who gets resources,
budgets, schedules
NEGOTIATOR:
represent departmental interests
what is a ROLE:
a set of expectations for one's behavior
so what is the profile of the
new manager?
there is a new image of the manager

INTERIM MANAGERS...

these managers are not affiliated with an specific organization but works by project based

Known as PROJECT MANAGER aswell
what are the new competencies
for managers??
coaching and providing guidance instead of command and control
empowering leadership
instead of keeping-tabs
collaborative relationship
team building skills
HOW ALLOCATE ITS MANAGERS??

1.- provide a list to HR of skills needed for the project
2. HR provide a pool of people who are qualified
3.- the director then puts together the best combination of people for the project
4.- normally are people working virtually all over the world (40% of project managers are virtual)
But there is one specific skill that
not every manager can handle and is the competence that makes you earn the BIG CHECK$$$$$$$.... which is????
MANAGING CRISIS AND DEALING
WITH THE UNEXPECTED
WHAT TO DO DURING TURBULENT TIMES???
SO WE CAN ORGANIZE THE ROLES IN THIS
3 CATEGORIES:

INFORMATIONAL:
monitor/disseminator/spokesperson

INTERPERSONAL:
figurehead/leader/liaison

DECISIONAL:
entrepreneur/disturbance handler/
resource allocator/negotiator
managers really have to stay on their toes
and apply all their skills and competencies
in a way that benefits the organization and
its stakeholders...
who are the stakeholders?
employees / customers / investors

community/ suppliers / government
therefore because stress and pressure managers:

fail to listen to customers
misinterpret signals from the market place
cant build a strong team and execute an strategic plan
poor communication 360 degrees
treating employees as instruments to be used
failing to clarify direction
suppressing dissenting viewpoints
unable to build mutul trust and respect
the world has become so fast, interconnected, and complex that unexpected events happen more frequently with more painful consequences
MANAGEMENT SUGGEST THE IMPORTANCE OF FIVE LEADERSHIP SKILLS:
STAY CALM...
since leader emotions are contagious they need to stay calm, focused and optimistic.
perhaps the most important part of a manager's job is to absorb peaople's fears and uncertaimties
BE VISIBLE..
must show your face, always
someone in control
PUT PEOPLE BEFORE BUSINESS
TELL THE TRHUTH
KNOW WHEN TO GET
BACK TO BUSINESS
Therefore we can deduct this idea:

one of the toughest challenges for managers today is....
getting people focused on adaptive change, meet the demands of and uncertain and rapidly changing environment
organizations need people thinking in new ways and learn new values and attitudes..

this demands a new kind of organization....
THE LEARNING ORGANIZATION...

managers began to think about this concept after the Peter senge's book:

"The fifth discipline: the art and practice of learning organizations"

lets see who is this guy and what is the main idea VIDEO.
so what is the learning organization??

is the organization in which everyone is engage in identifying and solving problems,
enabling the organization to continuously experiment, improve and increase its capability.
as discussed previously technology plays
an important role in this new earning organization

how???
to produce in mass scale
faster
better
stronger
be in touch with customers in real time
Hand in hand with the transition to a technology driven-place ...
supply chain management
customer relationships management
outsourcing
Connecting Ideas..
when entered to US autos got low quality ratings from customers..
first managers held quality seminars
commit to continuous improvement
delayed several models to solve the problems
so....
in few years Hyundai' s ratings were higher than Honda just before Toyota
MANAGEMENT PERSPECTIVE OVER TIME
management practice as discussed
can be allocated to 3000 BC
but as a formal study began with
classical theory
or perspective

characteristics;
1.- emerge in 19th and early 20th centuries
2.- with the factory system in 1800 new problems to face with organization, structure, training employees.
3.- communication problems since many of them were immigrants
a new "sub-specie of economic man

the
salaried manager
from classic perspective we divide 3 sub fields:
SCIENTIFIC MANAGEMENT
emphasized scientifically determined changes in management practices as the solution to improving labor productivity
who is the father of scientific management?

Frederick W. Taylor
workshops systems of Taylor
Determine time it took for a worker to a finish a process
Method to direct the efforts of the worker
Method of training, selection and supervision
Method that would reduce tensions incentive worker-supervisor
ADVANTAGES OF TAYLOR WORKSHOPS
Introduced the concept of research.
Encouraged the use of standards in manufacturing.
Need for planning processes.
Control.
Cooperation.
DISADVANTAGES OF HIS WORKSHOPS ;

• Consider that your application would always be on a stable environment.
• The principles are considered very general, so its application is limited to organizations of low complexity.
• the worker treated as part of the machine.
• It did not consider the human aspects related to their job satisfaction and other needs of man as social being.
FW TAYLOR, 1856–1915

American Mechanical Engineer that was obsessed with planning and control

"You are not supposed to think. There are other people paid for thinking around here"

"In the past man has been first; in the future the system must be first"
HENRY GANTT help Mr Taylor with his famous chart of Gantt..... what is it?

a bar graph that measures planned and complete work along each stage of the production by time elapsed.
Lillian M Gilberth and Fran B Gilberth (1878-1972)
pioneered time and motion study together with their psychology studies help a lot of today;s human resources techniques.
BUREAUCRATC ORGANIZATIONS
a systematic approach developed in Europe,

father of this sub field Max Weber (1864-1920)
german theorist
what happens here??

organization were managed by families..
the father , the mother, older brother..

so individual were loyal to an individual rather than to the organization or its mission...

so employees used resources for their own gain rather that to serve customers....
Weber established "employee selection" base on competence and technical qualifications... and

rules and procedures are impersonal and applied uniformly to all employees...

a clear division of labor, arises distinct definitions of authority and responsibility..

position are organized in hierarchy
bureaucracy normally is taken as a negative term, however we can conclude this..

rules and other bureaucracy procedures provide a standard way of dealing with employees...

everyone gets equal treatment and everyone knows what the rules are.
case of UPS:
this organization has a high level of bureaucracy:
all activities are established by the book:
1,- how load the truck
2.- how to fasten their belts
3.- how to walk
4.- how to carry their keys

rules apply to every one why????
ADMINISTRATIVE PRINCIPLES
this sub field focuses on the total organization rather than the individual worker, delineating the management functions of
planning ,
organizing,
commanding,
coordinating and
controlling
main contributors are:

Henry Fayol (1841-1925)
Mary Parker Follet (1868-1933)
Chester I Bernard (1886-1961)
FAYOL... a mining engineer wrote his concepts of administration in 14 general principals some of them are:

UNITY OF COMMAND: each subordinate receives orders form one
DIVISION OF WORK: specialization to produce more and better work with the same amount of effort
UNITY OF DIRECTION: activities grouped under one specific manager.
SCALAR CHAIN: a chain of authority from the top the bottom including every one.
FAYOL is the one that identify 5 functions of the administration;
planning, organizing, commanding, coordinating, controlling.
Mary P Follet was trained in Philosophy..
she applied her self in fields like social psychology and management....
she stressed the importance of leadership and people rather than engineering techniques.
CHESTER I BERNARD...
concept of the informal organization..
that happens in all formal organization..

mention that informal relationships are powerful forces that can help organization.

states that people have free will and choose whether to follow management orders...
HUMANISTIC PERSPECTIVE

emphasized the importance of understanding human behaviors, needs, and attitudes in the workplace
from Humanistic Perspective we have 3 sub fields
HUMAN RELATIONS MOVEMENT

satisfaction of employees' basic needs as the key to increase worker productivity
HUMAN RELATIONS PERSPECTIVE

jobs should be designed to meet higher-level need by allowing workers to use their full potential.
BEHAVIORAL SCIENCES APPROACH

applies social science in an organizational context and draws from economics, psychology, and other disciplines.
MANAGEMENT SCIENCE PERSPECTIVE

after world war II emerged and applied mathematics, statistics and other quantitative techniques to managerial problems.
TOTAL QUALITY MANAGEMENT

strongly associated with Japanese companies...
focus in managing the total organization to deliver quality to customers with 4 significant elements:

1.- employee involvement
2.- focus on the customer
3.- benchmarking
4.- continuous improvements
team presentations:

team 1- classical / scientific management

team 2- classical / bureaucratic organizations

team 3 - classical / administrative principles

team 4 - humanistic perspective/ human relations movement

team 5 - humanistic perspective / human resources perspective

team 6 - humanistic perspective/ behavioral sciences approach

team 7 - management science perspective / TQM
WHAT TO DO IN THE PRESENTATION?

1.- be creative
2.- all theory should be covered (thinkers and important facts)
3.- presentation must explain the thinking, the tendency, the main idea
4.- use videos, charts, boards, act, sing, cloth, cases, draws, paintings what ever.
5.- TIME important only 10 minutes per team.
6.- a written work should be uploaded to BB per team
7.- Check your assignment sheet at BB
Henry Ford made extensive use of Taylor's scientific management changing the mass production in the world with the car model T..
CHAPTER 2

The Environment and
Corporate Culture

The classical perspective helped us to understand the internal behavior at organizations where the managers can have control...
however is incomplete why
managers must monitor and respond to the environment...

the events of the environment have greater impact in any organization

for example.....???
WHAT IS THE EXTERNAL
ENVIRONMENT??
The elements of the world constantly change
Environment encompasses far-reaching global changes

General Environment:
Outer layer that directly affects organization

Task Environment:
Sectors that conduct transactions with the organization

Internal Environment:
Elements within the organization boundaries
all elements existing outside the boundary of the organization and have potential to affect it.

competitor, resources, technology and economics
factors like: social, economic, legal, political, international natural, and technological.
competitors, suppliers, customers, labor market
employees, management, specially corporate culture
GENERAL




ENVIRONMENT
SOCIOCULTURAL

Demographic characteristics, norms, customs, and values
The Hispanic population is expected to increase 188%
Generation Y is flooding the workplace with new demands
Single-father households are the fastest-growing type of living arrangement
Aging workforce demographics are changing all over the world
ECONOMICS

Economic health of the country/region
Extended globally with uncertainty
Consumer buying power
Merger and acquisition opportunity
Growth in the small business sector
Significant portion of U.S. economy
LEGAL AND POLITICAL

Government regulation; state, local and federal
Political activities
Government agencies and regulation
Managers must recognize the power of pressure groups
Work to influence companies to behave socially responsible
NATURAL

Organizations must be sensitive to the environment
Plants, animals, rocks and natural resources
The natural dimension does not have a voice of its own
Environmental groups advocate action/policy
Reduce pollution
Develop renewable energy
Climate change/global warming
INTERNATIONAL

Globalization influences all other aspects of the external environment
New competitors, customers, suppliers
Changes in social, technological and economic trends
All organizations must compete and think globally
Economic power has shifted to China and India
The global environment is complex and ever-changing
TECHNOLOGICAL
Technology has created massive changes for organizations
Technology has become the tool for doing business
Advances are impacting organizations and managers
TASK ENVIRONMENT

Customers
Competitors
Suppliers
Labor Market
CUSTOMERS...
PEOPLE AND ORGANIZATIONS IN THE ENVIRONMENT THAT ACQUIRE GOODS AND SERVICES FROM THE ORGANIZATION
COMPETITORS...
other organizations in the same industry or type of business that provide goods or services to the same set of customers
SUPPLIERS...
people and organizations that provide the raw materials the organizations uses to produce its output.
LABOR MARKET....
people available for hire by the organization
so what the managers should do when there is
UNCERTAINTY created by the environment??
design the organization culture and modus operandis to ADAPT to the environment
and what is UNCERTAINTY????
means that managers do not have sufficient information about environment factors to understand and predict needs and changes
How we ADAPT to the environment??
Boundary-spanning roles
Inter organizational partnerships
Mergers/joint ventures
Shift from adversarial orientation to partnership orientation
INTERNAL ENVIRONMENT

production technology, organization structure,
physical facilities but the most important is
corporate culture
Corporate culture is the set of key values, beliefs, understandings, and norms that members of an organization share

Symbols
Stories
Heroes
Slogans
Ceremonies
Shaping Corporate Culture for Innovative Response

Corporate culture plays a key role in organization climate
Successful companies balance culture and performance
Combining Culture and Performance
Cultural Leadership

Articulate a vision for the organizational culture that employees can believe in.
Heeds the day-to-day activities that reinforce the cultural vision.

Leaders communicate through words and actions.
ASSIGNMENT;
analyze the case of
AH-InBev - Grupo Modelo
LEVELS OF CORPORATE CULTURE
TYPES OF CORPORATE CULTURE
What is BUSINESS INTELLIGENCE?
using sophisticated software to search to large amounts of INTERNAL and EXTERNAL data to spot patterns, trends and relationships that may be significant
CHAPTER 3
BORDERLESS WORLD

Organizations and managers are not isolated from international forces:

Trade barriers have fallen
Communication is faster, cheaper
Consumer tastes converge

The difficulties and risks of a borderless world are matched by benefits and opportunities
Four Stages of Globalization
INTERNATIONAL MARKETING STRATEGIES

Exporting – transferring products for sale to foreign countries
Outsourcing – also called off shoring, work activities are done in countries with cheap labor
Franchising – licensing that provides a complete package of materials and services
Strategies for Entering International Markets
CHINA Inc.

Many companies are going to China and India, business is booming

More and more products are manufactured in these countries
China can manufacture at a much lower cost
India is growing in software design, services and engineering
Key Factors in International Environment
What are the fundamental tasks of business management?
f
inancing, production and distribution of products and services..

and these tasks....

do not change in any substantive way when a firm is transacting business across international borders..
neither the management functions..
P / O/ L/ C
therefore....what should managers of emerging global economies look for avoid obvious international mistakes ???

find, read and understand the key international environment....
ECONOMIC ENVIRONMENT:

economic condition include factors like:
ECONOMIC DEVELOPMENT:

LDCs (less developed countries)
measured in
per capita income
= income generated by the nation's production of goods and services divided by the total population

World Economic Forum rate each country validating with 113 factors to contribute to an economy's competitiveness.
INFRASTRUCTURE: a country's physical facilities to support economic activities such..????
Resource and Product Markets
Companies must evaluate the market demand for their products

Exchange Rates
Volatility in exchange rates can have major implications on profit
Greatest Challenge for McDonald's;

selling Big Mac in every continent except Antarctica,
in Krakow, the burgers come from a Polish Plant,
onions from Fresno Ca.
buns from a distribution center near Moscow
potatoes come form Germany.
LEGAL AND POLITICAL:

unfamiliar political systems,
more government supervisions and regulations
Political risk is defined as ;

the risk of lost assets, earning power, or managerial control.

Managers must be concerned with the political instability of global markets
POLITICAL INSTABILITY......

events such as riots, revolutions, or government upheavals that effect the operations of international company
some companies buy POLITICAL INSURANCE

and to reduce uncertainty companies rely on the:

INDEX OF ECONOMIC FREDOM

and

CORRUPTION PERCEPTION INDEX
WHAT IS CORRUPTION ACCORDING TO INTERNATIONAL TRANSPARENCY??
in what place you think Mexico is
between 183 countries???
No. 100 in 2011 Rate Index
Top 10 in 2010
SOCIO CULTURAL;

The values and behaviors, shared knowledge, ways of thinking among member of a society.

Social Values
Communication Differences
Other Cultural Characteristics like
Language, religion, social organization, education and attitudes
HOFSTEDE'S VALUE DIMENSIONS:

Power Distance;
degree people accept inequality in power
, low
people expect eqality

Uncertainty Avoidance;
people intolerance for uncertainty and ambiguity
, high
.. uncomfortable with uncertainty. low tolerance with unclear

Individualism and Collectivism;
Individual like to work by them self and take car of their own.
Collectivism; individual look after one another, work in groups

Masculinity and Femininity;
masculinity...stress, work and material success
femininity..reflects relationship values, quality of life.

Long-term/short term orientation;
long..greater concern for the future
short...high value on meeting social obligations
high ...Malaysia, Panama
Low.. Denmark, Austria
high....Greece, Portugal
Low.. Singapore, Jamaica
individualism.. US, Australia
collectivism.. Ecuador, China
masculinity..Japan, Mexico
feminine..France, Sweden
long... China, Asian Countries
short..Russia, West african countries
GOBE project use data from 18,000 managers in 62 countries to identify 9 dimensions that explain cultural differences
Assertiveness
Future orientation
Uncertainty avoidance
Gender differentiation
Power distance
Social collectivism
Individual collectivism
Performance orientation
Humane orientation
Country Ranking on Selected GLOBE Value Dimensions
COMMUNICATION DIFFERENCES

social context; social setting, nonverbal behavior, social status

HIGH CONTEXT CULTURE:
people are sensitive to social exchanges
communication primarily to build personal social relationships
relation and trust are more important than business

LOW CONTEXT CULTURE:
communication primarily to exchange facts and information
business , transactions are more important than relations
achievement are more important than the group
OTHER CULTURAL CHARACTERISTICS

LANGUAGE, RELIGION, EDUCATION, ATTITUDES
ETHNOCENTRISM:
a cultural attitude marked by the tendency to regard one's own culture as superior to the other

Example... US managers think ....

" american way is the best way"
LG electronics innovating under the cultural differences..

LG refrigerator in Korea for the Kimchi left overs..very smelly...
LG microwave for Kebab in Iran
LG TV with ultra sound system for India ..they use TV to listen to music.
INTERNATIONAL TRADE ALLIANCES

General Agreement on Tariff and Trade (GATT)
23 nations in 1947, a set of rules for fair trade

World Trade Organization (WTO)
Maturation of GATT into permanent global institute

European Union
1957 Alliance to improve economic and social conditions among members;
evolved to EU 27-nation

North American Free Trade Agreement (NAFTA)
Merged the United States, Canada and Mexico into trading bloc

68% of Americans say other countries benefit the most from free trade
The United States primary concern is the loss of jobs
Business leaders insist that economic benefits flow back to the U.S. economy
Lower prices
Expanded markets
Increased profits and funds for innovation
GLOBALIZATION BACKLASH...

For some reason every one thinks they are the loser...

Consider this example: For Boeing to hire an aeronautical specialists in Russia costs $650 a month while in the US can cost $6000 usd.

Therefore.... No jobs for American and same situation all around the world...
MANAGING CROSS-CULTURALLY

Human resources seek managers who will thrive internationally
Global skills will be a key consideration
Self-analysis must take place about family situations
Can you initiate social contacts in a foreign culture?
Can you adjust well to different environments and changes in personal comfort?
Can you manage your future reentry in the job market?
DEVELOPING CULTURAL INTELLIGENCE

Cultural intelligence – ability to use reasoning and observation skills to interpret unfamiliar gestures and situations and devise appropriate behavioral responses

Culturally flexible
Adapt quickly to new situations

Managers must study the language and learn

Cognitive, emotional and physical intelligence
some international examples...

1.-Dutch have to learn English, German and french to interact and trade with ther dominant neighbors.

2.- Asians, Arabs, Africans and Latin Americans the loss of self respect brings dishonor to themselves and their families

3.- A high value collectivism in Japan means that employees are motivated in groups. an individual bonus for high performance would be considered humiliating.
CHAPTER 5
Managerial planning and goal setting

How fundamental is planning??
All of the other management functions stems from planning

However is the most controversial why??

How do you plan for an undefined future?

Does that mean it's useless to make plans??

No plan is perfect
However new manager understand that plans should grow and change to meet new conditions
Goals and Plans... what is it??
A goal is a desired future state that the organization attempts to realize.
A plan is a blueprint for goal achievement and specifies the necessary resource allocations, schedules, tasks and other actions.
PLANNING
LEVELS OF GOALS AND PLANS
PURPOSE OF GOASL AND PLANS????
Planning has a positive effect on performance
Send message to external and internal audiences; create legitimacy
Source of motivation and commitment
Resource allocation
Guides action
Rationale for decisions
Establishes standard of performance
ORGANIZATIONAL PLANNING PROCESS
GOALS IN ORGANIZATIONS

Organizational Mission –
the organization’s reason for existence.

Strategic goals –
official goals, broad statements describing the organization’s future

Goals should be aligned.
A Strategy Map for Aligning Goals
OPERATIONAL PLANNING

Direct employees and resources
Guide efficient and effective performance
Include planning approaches:
Management By Objective (MBO)
Single-use Plans
Standing Plans
Criteria for Effective Goal Setting
Management by Objective (MBO)

Defined in 1954 by Peter Drucker
Method for defining and monitoring goals
MBO Benefits and Problems
Single Use Plans
Achieve one-time goal
Programs and Projects

EXAMPE;
Renovating the office
Setting up an intranet for the company
building a new headquarter
Standing Plans
Ongoing plans
Policies, rules, procedures

Example;
Procedures for issuing refunds
sexual harassment policies
Planning for a Turbulent Environment
Contingency Planning
Planning for emergencies, setbacks or unexpected conditions
Building Scenarios
A forecasting technique to look at current trends and visualize future possibilities
Crisis Planning
Sudden, devastating unexpected events
Essentials Stages of Crisis Planning
Planning for High Performance

Traditional planning is a central process of executives and consultants
A shift to decentralized planning to increase organizational performance
High-performance approaches to planning;

Set stretch goals for excellence
Use performance dashboards
Deploy Intelligence Teams
Performance Dashboard for Planning
THINKING STRATEGICALLY.....

Take the long-term view
See the BIG PICTURE
Strategic thinking is important for all organizations
Impacts an organization’s performance
51% of executives are unhappy with strategy formulation process
Tough decisions and choices define and support strategy
WHAT IS STRATEGIC MANAGEMENT??

Define explicit strategy/plan of action
Achieve competitive advantage
Exploit Core Competencies – what does the organization do well compared to competitors?
Build Synergy – joint effort to gain special advantage
Deliver Value – combination of benefits and costs
STRATEGIC MGT PROCESS...

Strategy Formulation
Planning and decision making that lead to goals and plans
Strategy Execution
Managerial tools to direct resources toward strategic outcomes
SWOT Analysis
The Strategic Management Process/SWOT
Checklist for Analyzing Organizational Strengths and Weaknesses
FORMULATING BUSINESS-LEVEL STRATEGY

Michael E. Porter developed model for the development of business-level strategy
Porter’s Five Competitive Forces – help determine a company’s position in the industry

Potential new entrants
Bargaining power of buyers
Bargaining power of suppliers
Threat of substitute products
Rivalry among competitors
Porter’s Five Competitive Forces
Porter’s Competitive Strategies
NEW TRENDS IN STRATEGY

Dynamic capabilities
- organizations desire to enhance existing capabilities
Innovation from within
Learning
Reallocation of assets
Internal innovation
Strategic Partnerships
Collaboration with other organizations
The Internet is driving more collaboration
Global Corporate Strategy
Putting Strategy into Action
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