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Organizational Control
The systematic process through which managers regulate organizational activities to make them consistent with expectations established in plans, targets and standards of performance.
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balanced scorecard
a comprehensive management-control system that balances traditional financial measures of customer service, internal business processes and the organization's capacity for learning and growth
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4 key steps in the feedback control process
- 1. Establish standards of performance
- 2. Measure actual performance
- 3. Compare performance to standards
- 4. Take corrective action
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Hierarchial control
the use of rules, policies, hiearchy of authority, reward systems, and other formal devices to influence employee behavior and assess performance
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Decentralized control
the use of organizational culture, group norms, and a focus on goals rather than a focus on goals rather than on rules and procedures to foster compliance with organizational goals
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Open-Book Management
sharing financial information and results with all employees in the organization
Allows for employees to see for themselves - through charts, computer printouts, meetings, and so forth - the financial condition of the company
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Total Quality Management
an organization-wide commitment to infusing quality into every activity through continuous improvement
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Quality circle
a group of 6 to 12 volunteer employees who meet regularly to discuss and solve problems that affect the quality of their work
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benchmarking
the continuous process of the measuring products, services, and practices against major competitors or industry leaders
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Six Sigma
a quality control approach that emphasizes a relentless pursuit of higher quality and lower costs
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cycle time
the steps taken to complete a company process
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Continuous improvement
the implementation of a large number of small incremental improvements in all areas of the organization on an ongoing basis
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Economic Value-added
a control system that measures performance in terms of after-tax profits minus the cost of capital inversted in tangibile assets
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ISO 9000 Standards
a set of standards as outlined by the international organization for standardization that represent and international consensus of what constitutes effective quality management
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Management
The attainment of organizational goals in an effective and effiecient manner through planning, organizing, leading and controlling organizational resources
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4 Basic Functions of management
- planning - select golas and ways to obtain them
- organizing - assign responsibility for tasks
- leading - use influence to motivate
- controlling - monitor activites and make corrections
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Organization
A formally structured collection of individuals working toward common/shared goals
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Efficiency
the use of minimal resources(input) to produce a desired volume of profit
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Effectiveness
the degree to which the organization acheives a stated goal
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Conceptual Skills
cognitive ability to see the organization as a wwhole and the relationship among its parts
top managers need this the most
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Human Skills
Ability to work with and through other people and work effectively as a group member
all managers need this skill
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Technical Skills
understanding of and proficiency in the performance of specific tasks
- lower managers -> Most
- medium managers -> More
- Top Managers -> least
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Roles of Managers
Informational roles: develop and maintain information network (monitor, spokesperson)
Interpersonal roles: pertain to relationships with others (figurehead, leader)
Decisional Roles: to make choices requiring conceptual and human skills (entrepenuer, negotiator)
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Crisis Management Skills
- Stay Calm
- Be visible
- put people before business
- tell the truth
- know when to get back to business
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Learning Organization
- Continuously improves based on the lessons of experience manages knowledge,
- workers must possess and use knowledge,
- knowledge needed is increasing,
- knowledge needs to be preserved and communicated continuous improvement through teams,
- open book management of information and empowered workers
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Classical Perspective
rational, scientific, approach to study of management and sought to make workers and organizations like efficient machines
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Scientific Management
standard methods, careful selection, training, good working conditions, provide incentives
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Bureaucratic organizations
defined authority and responsibility, set procedures, goals of fairness and efficiency, seperation of management and owners
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Administrative Management
14 principles
- unity of comand
- division of work
- unity of direction
- scalar chain of command
- authority = responsibility
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How did the Hawthorne studies lessen the influence of the classical perspective
enlightened treatment of workers and powersharing between managers and employees, satisfaction of employees' social and physiological needs as key to increased worker productivity
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Theory X
Classical
- People dislike work and prefer to be directed
- must be coerced to work
- want to avoid responsibility
- have little ambition
- want security above everything
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Theory Y
Human resources
- people will accept respnsibility
- have intellect that could be apploed to organizational goals
- only partially use their intellectual potential
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Total Quality Management
emphasizes continuous improvement in all organizational processes, lead to the learning organization
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How are goals and plans interrelated?
- Communicate legitimacy to external audiences such as investor’s customers and suppliers
- A source of motivation and guidance for internal audiences
- - Helps employees identify with the organization
- - reduce uncertainty and clarify what employees should accomplish
- - help minimize wasted resources
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Mission Statements
- Most general purposes, goals and plans
- Long run vision values
- What distinguishes it from other organizations
- focus on items such as market and customers
- product quality
- location on facilities
- attitude towards employees
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Strategic Goals
Top management
- Organization
- plan for several years
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Tactical goals
Middle management
- major units of the organization
- plan for up to 2 years
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Operational Goals
Lower Management
- departments, individuals
- plan mostly for under a year
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Characteristics of Effective Goals
- Specific
- Measureable
- Attainable (and challenging)
- Relevant (key result Ares)
- Time-based
- Rewards
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4 goals of MBO
- Setting goals
- developing action plans (can be used to decentralize planning)
- reviewing progress
- Appraising overall performance
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Benefits of MBO
- Clarity (people know what to do)
- Commitment (are motivated and self-managed)
- Coordination (work towards something)
- Fairness
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Problems with MBO
- difficulty choosing relevant measurable goals
- rigidity
- people skills required
- time required
- paperwork
- frequently sold as a cure all
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Single use plans
Aim at achieving a specific non-recurring goal
Program to achieve an important one time organizational goal
Project similar to a program but generally smaller in scope and complexity
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Standing Plans
Provide guidance for recurring activities
Policy in a general guide to action and provides direction for people
Rules describe hos a specific action is to be preformed
Procedures define a series of steps to be used in achieving a specific job
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Contingency Plans
Define a company responses to be taken in case the plan implemented does not work as expected
could also be used for unexpected positive results
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SWOT Analysis
- Internal
- - Strengths
- - Weaknesses
- External
- - Opportunities
- - Threats
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Cost Leadership
the organization aggressively seeks efficient facilities , pursues cost reductions, and uses tight controls to produce products more efficiently than competitors
- Strong central authority
- maintains standard operating procedures
- easy to use manufacturing technologies
- highly efficient procurement and distribution systems
- close supervision, finite employee empowerment
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Focus strategies
the organization concentrates on a specific regional market or buyer group
- frequent, detailed control reports
- may use combination of above policies directed at a specific strategic target
- values and rewards flexibility and customer intimacy
- measures cost of providing service and maintaining customer loyalty
- pushes empowerment to employees with customer contact
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New trends in strategy
- Innovation from within
- - dynamic capabilities - managers focus on leveraging and developing more front he firms assets, capabilities, and core competencies in a way that will provide a sustained competitive advantage
Strategic partnership
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Organizational Chart
is the visual representation of an organizations structure
Vertical structure - coordination from top to bottom
Horizontal structure - departmentalization - who works together
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Work Specialization
- degree to which tasks are subdivided into individual jobs
- a highly specialized job is narrow in scope
- increases efficiency up to a point
- with extreme specialization workers tend to become bored and alienated
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Chain of command
the like of authority, shown in the organizational chart, that links all persons and shows who reports to whom
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Authority
- Managers have authority because of the positions the hold - not who they are
- to be effective, it must be accepted but subordinates
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Responsibility
- duty to perform the task and employee has been assigned
- Authority should be commensurate with responsibility
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Delegation
- Process to transfer authority and responsibility to positions below
- delegation does not reduce responsibility
- benefits both the organization and the individual employee
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Line Authority
means that people in management positions have formal authority to direct and control immediate subordinates
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Staff authority
is narrower and includes the right to advise, recommend, and counsel in the staff specialists' area of expertise
a communication relationship
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Span of Management
- number of employees reporting to a supervisor
- tradition has recommended a span of management of four to seven subordinates
- what is best depends on the situation
- Factors
- Work performed but subordinates is stable and routine
- subordinates perform similar work tasks
- concentrated in a single location
- highly trained and need little direction in performing tasks
- rules and procedures defining task activities are available
- support systems and personnel re available for the manager
- little time is required in nonsupervisory activities such as coordination with other departments or planning
- managers personal preferences and styles favor a large span
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Centralization
Authority at the top - little delegation
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Decentralization
Authority is pushed down to the lower levels, much delegation
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Functional Approach
departments based on similar activities, skills and resource use
Advantages: efficient use of resources, Economies of scale, in depth skill specialization
Disadvantages: poor communication, among departments, slow response to external changes, loyalty more to function than customer of the whole organization
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Divisional Approach
- departments are grouped together based on organizational outputs( product, geography, customer)
- functions (eg. marketing) are split between the divisions
- its advantages and disadvantages tend to be the opposite of those of the functional approach
advantages: quicker changes in unstable environment, more in touch with customers
disadvantages: duplication (competition for resources among divisions), less professional specialization
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Matrix approach
- functional and divisional chains of command simultaneously
- violates the unity of command concept
advantages: sophisticated technology, fast-changing environment, to get the advantages of both functional and divisional structures, diverse products and geographical areas
disadvantages: many meetings to coordinate activities, high conflict between two sides of matrix, need for extensive human relations training
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Team approach
- cross functional teams (clusters) consist of employees from various functional departments
- teams typically have more decision making power than previously held by workers at their levels
advantages: quicker response time, better morale, reduced administrative overhead
disadvantages: conflict, time and resources spent on meetings
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Network Approach
- virtual
- organization divides major functions among separate companies brokered by a small headquarters organization
- somewhat like a functional organization
advantages: increases competitiveness, especially of small firms, flexibility, reduced costs
disadvantages: no hands- on control, loyalty weakened
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General Goals of human resource management
Attract, Develop, and maintain an effective work force
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Attitudes: ABC Model
An Evaluation either positive or negative that predisposes a person to act in a certain way
- Affect - feelings for an object
- Behavioral Intentions - potential behavior towards an object
- Cognition - beliefs about an object
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Attitude Change Techniques
- Persuasion - cognition -> behavior : if you change your beliefs then your behavior will change
- Conditioning - affect -> Cognition -> behavior : change feelings, then change beliefs, then change behavior
- Cognitive Dissonance Production - behavior -> cognition : change beliefs in order to justify behavior
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Perception
the cognitive process people use to make sense out of the environment by selecting, organizing, and interpreting information from the environment
"the link between the person and the environment"
includes social perception - impressions of people
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Selectivity
perceiving only part of environment or attending to some parts more than others
- external factors - similarity, size, nearness, motion
- internal factors - experience, motivation
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Closure
Adding to your perception
- stereotyping
- halo effects
- attribution - judging the causes of someone’s behavior
perceive a whole when only parts are there
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Fundamental Attribution Error
We perceive others behaviors as more internally caused than they are
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Self-serving bias
we perceive our own
- success as internal
- failure as external
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Personality
Is the set of characteristics that underlie a relatively stable pattern of behavior in response to ideas, objects, or people in the environment
- Internal state - can't observe personality
- Uniqueness - all different than everyone else
- consistency
- stability - consistency across time
Managers who appreciate the ways their employees personalities differ have insight into what kinds of leadership behavior will be most influential
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Emotional Intelligence
- 1. knowing one's own emotions
- 2. controlling one's emotions
- 3. recognizing other's emotions - empathy
- 4. Social Skill - controlling others emotions
Incompetence in management occurs more often from lack of EQ than lack of IQ
Essential in managing conflict
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Locus of Control
People who believe that individuals are in control of their own lives have an internal locus of control
people that think that forces beyond their control dictate what happens to them have an external locus of control
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Type A Behaviors
- Highly competitive
- impatient
- high job involvement
- aggressiveness
- more stress related illnesses
- high energy
- seek positions of power and responsibility
- determinants
- - sensitive nervous system
- - demanding parents (love contingent upon achievement)
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Level 5 Leadership
- a leader with a combination of personal humanity and resolve
- more ambitious for their companies than for themselves
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interactive leadership
a leader who is concerns with consensus building, is open and inclusive, and encourages participation
seems to be more prevalent among females
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Leadership Grid
- Concern for production measured from 1 to 9
- concern for people measured on a scale of 1 to 9
- team management (9,9) is often considered the most effective style for all managers
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Transactional Leader
this is the traditional view of leadership that the new approaches are contrasted with
A leader who clarifies subordinates' role and task requirements, initiates structure, provides rewards, and displays consideration for subordinates
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Charismatic Leader
a leader whose personality motivates subordinates to transcend their expected performance
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Visionary leader
a leader who is able to imagine how the future could be and inspire others to work toward creating that future
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Transformational Leader
A leader distinguished by a special ability to bring about innovation and change
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Servant Leader
A leader who works to fulfill subordinates' needs and goals - as a means to achieve the organizations larger mission
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Substitutes
accomplish by other means what leaders do
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neutralizers
prevent leader from leading - lack of power to control rewards, physical separation
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Organizational behavior
an interdisciplinary field dedicated to the study of human attitudes, behavior and performance in organizations
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Organizational Citizenship
refers to the tendency of people to help one another and put in extra effort that goes beyond job requirements to contribute to the organizations success
being helpful to coworkers and customers, doing extra work when necessary, looking for ways to improve products and procedures
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Cognitive component
include the beliefs, opinions and information the person has about the object of the attitude
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Affective component
the persons emotions about the object of the attitude
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behavioral component
the persons intention to behave toward the object of the attitude in a certain way
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Perceptual selectivity
is the process by which individuals subconsciously screen and select the various objects and stimuli that vie for their attention
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Stereotyping
the tendency to assign an individual to a group or broad category and then to attribute widely held generalizations about the group to the individual
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halo effect
occurs when the perceiver develops an overall impression of a person or situation based on one characteristic either favorable or unfavorable
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projection
the tendency of perceivers to see their own personal traits in other people, project their own needs, feelings, values and attitudes into their own judgment of others
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perceptual difference
the tendency of perceivers to protect themselves against objects, ideas or people that are threatening
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attributions
judgments about what caused a person’s behavior
- internal - says characteristic of person lead to behavior
- external - says something about the situation caused the persons behavior
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Distinctiveness
whether the behavior is unusual for that person
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consistency
whether the person being observed has a history of behaving in the same way
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consensus
whether other people tend to respond to similar situations in the same way
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Authoritarianism
the belief that power and status differences should exist in the organization
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Machiavellianism
is characterized u the acquisition of power and the manipulation of other people for purely personal gain
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Type B
Less of Type A
experience less conflict with other people and a more balanced relaxed lifestyle
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Stress
and individuals physiological and emotional response to external stimuli that place physical or physiological demands on the individual and create uncertainty and lack of personal control when important outcomes are at stake
- peoples responses to stress vary according to their personalities
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Leadership
the ability to influence people toward the attainment of goals
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Humility
being unpretentious and modest rather than arrogant and prideful
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Differences between a manager and leader
manager - promotes stability, order, and problem solving within the existing organizational structure
leader - promotes vision, creativity, and change. questioning the status quo so that outdated, unproductive or socially irresponsible norms can be replaced to meet new challenges - move organization into the future
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consideration
people oriented behavior, the extent to which leadership is mindful of subordinates, respects their ideas and feelings, and establishes mutual trust
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initiating structure
degree of task behavior, the extent to which the leader is task oriented and directs subordinate work activities toward goal attainment
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situational theory
an interesting extension of the behavioral theories summarized in the leadership grid
- subordinates vary in readiness level
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Fiedlers Contingency Theory
highly favorable/ unfavorable situation - task oriented is best
moderate favorability - relationship oriented is best
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Power
potential ability to influence the behavior of others
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influence
the effect a person’s actions have on the attitudes values and beliefs or behavior of others
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sensation - thinking
- emphasizes details facts certainty
- is a decisive applied thinker
- focuses on short term realistic goals
- develops rules and regulations for judging performance
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intuitive - thinking
- prefers dealing with theoretical or technical problems
- is creative, progressive, perceptive thinker
- focuses on possibilities using impersonal analysis
- is able to consider a number of options and problems simultaneously
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sensation - feeling
- shows concern for current, real-life human problems
- is pragmatic, analytical, methodical and conscientious
- emphasizes detailed facts about people rather than tasks
- focuses on structuring organizations for the benefit of people
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intuitive - feeling
- avoid specifics
- is charismatic, participative, people oriented and helpful
- focuses on general views, broad themes and feelings
- decentralizes decision making, develops few rules and regulations
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alienated follower
a person who is an independent, critical thinker but is passive in the organization
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conformist
a follower who participates actively in the organization but does not use critical thinking skills
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passive follower
a person who exhibits neither critical independent thinking nor active participation
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effective follower
a critical, independent thinker who actively participates in the organization
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Legitimate power
power that stems from a formal management position in an organization and the authority granted to it
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reward power
power that results from the authority to bestow rewards on other people
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expert power
power that stems from special knowledge of or skill in the tasks performed by subordinates
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referent power
power that results from characteristics that command subordinates' identification with respect and admiration for and desire to emulate the leader
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Moral Leadership
distinguish right from wrong and choosing to do right in the practice of leadership
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Motivation
refers to the forces either within or external to a person that arouse enthusiasm and persistence to peruse a certain course of action
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Intrinsic rewards
are the satisfactions a person receive in the process of performing a particular action
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Extrinsic Rewards
are given by another person typically a manager, and include promotions, pay increases and bonuses
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Content theories
a group of theories that emphasize the needs that motivate people
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Hierarchy of needs theory
A content theory that proposes that people are motivated by 5 categories of needs that exist in a hierarchal order
low order needs take priority over high level needs
- Physiological needs
- safety needs
- esteem needs
- belongingness needs
- self-actualization needs
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Physiological needs
these most basic human physical needs include food water and oxygen
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Safety needs
these needs include a safe and secure physical and emotional environment
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Esteem needs
reflect the desire for a positive self-image and to receive attention, recognition, and appreciation from others
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Belongingness needs
relate to the desire to be accepted by one’s peers, have friendships, be a part of a group, and be loved
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self-actualization needs
these needs include the need for self-fulfillment, which is the highest need category
concern for developing ones full potential , increasing ones competence and becoming a better person
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ERG Theory
identifies only three categories of needs
- Existence needs - the needs for physical well being
- Relatedness needs - the need for satisfactory relationships with others
- Growth needs - the needs that focus on the development of human potential and the desire for personal growth and increased competence
movement up the hierarchy is more complex
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Frustration- Regression principle
the idea that failure to need a high order need may cause a regression to an already satisfies lower need
used in ERG theory
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Two factor theory
work characteristics associated with dissatisfaction were quite different from those pertaining to satisfaction
- Hygiene factors
- motivators
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Hygiene factors
involve the presence or absence of job satisfiers include working conditions, pay, company policies, and interpersonal relationships
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Motivators
factors that influence job satisfaction based on fulfillment of highest level needs such as achievement, recognition, responsibility and opportunity for growth
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Acquired needs theory
proposes that certain types of needs are acquired during the individuals lifetime
- 1. need for achievement - the desire to accomplish something difficult, attain a high standard of success, master complex tasks and surpass others
- 2. need for affiliation - the desire to germ close personal relationships, avoid conflict and establish warm friendships
- 3. needs for power - the desire to influence or control others, be responsible for others, and have authority over others
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Process Theories
a group of theories that explain how employees select behaviors with which to meet their needs and determine whether their choices were successful.
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Goal-Setting Theory
a motivation theory in which specific challenging goals increase motivation and performance, when the goals are accepted by subordinates and these subordinates receive feedback to indicate their progress toward goal achievement
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Equity
A situation that exists when the ratio of one person's outcomes to inputs equals that of others
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Equity Theory
A Process theory that focuses on individuals' perceptions of how fairly they are treated relative to others
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Reduce feeling of equity
- change work effort - a person may choose to increase or decrease his/her inputs to the organization
- change outcomes
- change perceptions - research suggests that people are able to change perceptions of equity if they are unable to change inputs or outcomes
- leave the job - people who feel inequitably treated may decide to leave their jobs rather than suffer the inequity of being under/over paid
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Expectancy Theory
a process theory that proposes that motivation depend on individuals expectations about their ability to perform tasks and receive desired awards
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E -> P expectancy
expectancy that putting effort into a given task will lead to high performance
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P -> O expectancy
expectancy that successful performance of a task will lead to a desired outcome.
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Valence
the value or attraction an individual has for an outcome
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reinforcement theory
a motivation theory based on the relationship between a given behavior and its consequences
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behavior modification
the set of techniques by which reinforcement theory is used to modify human behavior
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positive reinforcement
the administration of pleasant and rewarding consequence following a desired behavior
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Avoidance learning
negative reinforcement
the removal of unpleasant consequence when an undesirable behavior is corrected
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Extinction
the withdrawal of a positive reward
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Punishment
the imposition of an unpleasant outcome following undesirable behavior
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Job rotation
a job design that systematically moves employees from one job to another to provide them with variety and stimulation
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job enlargement
a job design that Comines a series of tasks into one new broader job to give employees variety and challenge
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job enrichment
a job design that incorporated achievement, recognition, and other high-level motivators into the work
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Core Job Dimensions
Determine a jobs motivation potential
- Skill variety
- task identity
- task significance
- Autonomy
- Feedback
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Skill variety
- the number of diverse activities that compose a job and the number of skills used to perform it
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Task Identity
- the degree to which an employee performs a total job with a recognizable beginning and ending
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Task Significance
the degree to which the job is perceived as important and having an impact on the company or customers
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Autonomy
The degree to which the worker has freedom, discretion, and self-determination in planning and carrying out tasks
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feedback
the extent to which doing the job provides information back to the employee about his/her performance
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Empowerment
Is power sharing, the delegation of power or authority to subordinates in an organization?
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