MGMT516 Week 6 Overview

What is the difference between management and leadership? John Kotter of the Harvard Business School writes that management is about coping with complexity, and that good management brings about order and consistency by drawing up formal plans, designing organizational structures, and monitoring results against the plans.

Typically, management includes well-known processes, such as budgeting, staffing, structuring jobs, decision-making, and measuring performance. Managers help organizations to produce products and services of consistent quality, on time, and within budget. Management includes the organization, coordination, and monitoring of business activities in order to achieve organizational goals and objectives.

In today’s complex organizations, this is an enormously difficult task. According to Kotter, “We constantly underestimate how complex this task really is, especially if we are not in senior management jobs. So, management is crucial—but it’s not leadership.”

Leadership is about coping with change. Leaders establish direction by developing a vision of the future and then aligning people by communicating this vision and inspiring others to overcome hurdles. But not all leaders are managers. For that matter, not all managers are leaders.

Although there are similarities, leadership and management are different. Leadership is largely motivational in nature, whereas management focuses on maintaining performance. Kotter notes that managers produce order and consistency, while leaders produce change and movement. However, while the activities of management and leadership may be played out differently, both are essential for an organization to prosper.

Chapter 12 of your textbook will provide an in-depth look at managers and their primary responsibility for organizational effectiveness and efficiency. In an organization, managers are responsible for increasing effectiveness and efficiency, as well as maintaining balance between the two. Yet it is essential that the difference between efficiency and effectiveness is made distinctly clear, as the two are nearly inseparable in business strategy, but they command two different points of view. Understanding the interplay between effectiveness and efficiency is crucial. Successful managers realize that the two are not mutually exclusive, and that it is not possible for an organization to survive with just efficiency alone and not effectiveness. Moreover, good managers know how to achieve both objectives.

While chapter 12, examines the difference between management and leadership, chapter 13 of your textbook will focus on leadership theories and styles. All leaders exert influence over members of a group or organization. Some leaders, however, are given the formal or legal authority to do so. Formal leaders are those managers who are given legal authority to influence other members in the organization in order to achieve its goals. This legal authority gives them the power to control and make the best use of an organization’s resources, including its money and capital and the abilities and skills of its employees. Informal leaders have no legal authority to influence other employees, but their personal skills and qualities give them the ability to exert influence in an organization. Sometimes, these individuals may wield as much influence as the organization’s formal leaders. The ability of informal leaders to influence other people often stems from the special skills or talents they possess—skills an organization’s members realize will help achieve its goals.

Leaders influence and control the actions and beliefs of employees who directly report to them, those who work in the specific groups or teams they directly control, and even those who work across an entire organization. A number of different leadership theories have been proposed by scholars over the years. The various approaches to leadership described in chapter 13 seek to explain why some people become leaders and others do not, and why some leaders are more effective than others in their attempts to influence people and groups.

Leadership is about coping with change. Hence, as we will learn in chapter 13, leadership is defined as the ability to influence a group toward the achievement of a vision or a set of goals. The source of this influence may be formal, such as that provided by managerial rank in an organization. Leaders establish direction by developing a vision of the future and then aligning people by communicating this vision and inspiring others to overcome hurdles.

Effective decision-making is an important skill for all employees and is particularly important for supervisors, managers, and leaders. Decision-making is defined as the process of choosing a solution from available alternatives. Simply put, it is the thought process of selecting a choice from several alternative options.

The first part of chapter 14 will examine the different types of decisions found in the workplace. You will learn about programmed and non-programmed decisions and rational decision-making, including the assumptions and limitations of the model. An exploration of the various approaches to decision-making will help students recognize your own style and utilize different approaches. Through an understanding of the advantages and disadvantages of the different styles, students will be able to utilize different styles according to the situation. Additionally, throughout your career, you will work with people with different decision-making styles and make different types of decisions, such as programmed and non-programmed decisions and individual and group decisions.

All organizational employees face decisions daily. In the workplace, you will be faced with two broad types of decisions—programmed and non-programmed. Programmed decisions are routine, almost automatic. Programmed decisions generally involve situations that have occurred before, so policies and processes already exist for how to handle them. Responding is simply a matter of following the guidelines on how to handle the situation. On the other hand, non-programmed decisions occur in unusual situations that have not been addressed often. Policies or guidelines do not exist yet, so these types of decisions are made on a manager’s intuition or best judgment.

When making decisions, have you ever encountered an ethical dilemma? Often, ethical dilemmas can be rather innocuous, such as informing a clerk that you have been undercharged for an item. Other times, ethical dilemmas can be quite significant, such as reporting a coworker for stealing inventory from the company’s warehouse. These unplanned situations are your “moments of truth,” often occurring with little time for you to prepare a response. How will you react? Will you act on impulse or emotion? Will you follow a script or “how-to” procedure? Or will you think through the situation, collect information, consider various courses of action, and act accordingly? As you read through this chapter, consider how you might react in your moment of truth. Typically, a moment of truth is defined as a time when a person or thing is tested, a decision must be made, or a crisis must be faced.

Chapter 15 of your textbook will look at ethics and values. Ethical issues occur at all levels of the organization and are more nuanced than ever because of the complexity of choices that we face in each decision we make. Ethical thinking refers to the cognitive means by which people reason when they are faced with situations that involve values. It is the systematic evaluation of ethical issues at the moment of truth to determine whether a person’s actual or contemplated behavior is ethical or unethical.

Chapter 15 will also examine ethical decision-making frameworks that combine both ethical perspectives and ethical models, providing a systematic process designed to produce ethical decisions.


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