Term
| What is a public-sector organization? |
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Definition
A public-sector organization is any enterprise that is owned by the state rather than by private citizens. A public-sector organization's primary objective is to provide a service to the public rather than a profit for owners.
Text page 6. |
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Term
| What is a private-sector organization? |
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Definition
A private-sector organization is any enterprise that is owned by private citizens rather than the state. A private-sector organization's objective is to earn profits for the owners by providing products and/or services demanded by society. Private-sector organizations take the form of sole proprietorships, partnerships and limited liability companies.
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Term
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Definition
A sole trader is a business organization wherein one person provides the permanent finance and, in return, retains full control of the business and enjoys all the profits. In addition, the sole trader assumes all risk for the enterprise and is personally liable for all debts created by the business.
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Term
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Definition
A partnership is a business organization wherein two or more people enter into a contract to create and/or run a business enterprise. Each partner provides some amount of permanent finance and, in return, retains some amount of control of the business and enjoys some amount of the profits. In addition, each partner assumes some amount of risk for the enterprise and each is personally liable for some amount of the debts created by the business. Each partner's amount of control, profits and personal liability is determined by the partnership agreement and is usually based on the finance invested by that parter.
Text page 7.
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Term
| What is limited liability? |
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Definition
This is the concept that owners of a company lose only the amount of their investment in shares of the company if the company goes out of business. The owners (shareholders) are not personally liable for the debts of the company and their private assets (homes, boats, cars, bank accounts) are not at risk.
Text page 8. |
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Term
| What is unlimited liability? |
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Definition
This is the concept that owners of a company are personally liable for the debts of the company and their private assets (homes, boats, cars, bank accounts) can be taken if the business fails.
Text page 7. |
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Term
| What is the Memorandum of Association? |
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Definition
This establishes the company; states its name, registered office and authorized capital; and determines its objectives.
Text page 9. |
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Term
What are the Articles of Association? |
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Definition
These are the internal regulations governing:
- the conduct of a company
- general procedures for the running of it
- the identification of officers (directors and secretary)
- declaration of compliance with local registration laws
- a statement of nominal capital (total share value)
Text page 9. |
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Term
| What is a private company? |
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Definition
This is a company whose ownership is represented by shares of stock that are traded privately among interested individuals but not on the public stock exchanges. Do not confuse this with a private sector organization.
Text page 10. |
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Term
| What is a public company? |
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Definition
This is a company whose ownership is represented by shares of stock traded freely on the public stock exchanges. Do not confuse this with a public sector organization.
Text page 10. |
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Term
| What does the acronym GROUP stand for? |
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Definition
Managers:
- must have Goals
- are Responsible for results
- work in Organizations
- must cope with Uncertainty
- work in Partnership with people
Text page 19. |
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Term
| This is a pictorial representation of the formal organizational structure. It depicts relationships between positions in the organization. |
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Definition
Organizational chart
It is important to be familiar with your organizational chart so that you know the chain-of-command...who you report to, who reports to you, and who is in your formal communication net.
Text page 37. |
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Term
| Who created the "Five Tasks of Management?" |
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Definition
Henri Fayol
Text page 22. |
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Term
| Who created the "Ten Action Roles of Managers?" |
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Definition
Henry Mintzberg.
Text page 23. |
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Term
| Henry Mintzberg grouped the "Ten Action Roles of Managers" into three categories or roles. What are these three categories? |
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Definition
1. interpersonal
2. informational
3. decisional
Text page 22 and Table 2.1. |
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Term
| What are the first three steps in the 9-step decision-making process? |
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Definition
1. identify objectives
2. define the problem
3. collect data
Text page 24 and Figure 2.2. |
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Term
| What are the last three steps in the decision-making process? |
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Definition
7. choose the best solution
8. implement the solution
9. monitor and evaluate progress toward goal
Text page 25 and Figure 2.2. |
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Term
| What is at the top of the objective hierarchy? |
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Definition
The mission statement.
Text page 26. |
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Term
| Sound objectives should conform to the SMART criteria. List the SMART criteria. |
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Definition
S - specific
M - measurable
A - agreed upon
R - relevant and realistic
T - timetabled
Text page 26. |
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Term
| When describing the hierarchy of objectives, what does the acronym MOST stand for? |
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Definition
What an organization is seeking to achieve --
M - mission: the organization's overall reason for
existing
O - objectives: the organization's long-term goals
How an organization will achieve it --
S - strategy: long-term plans designed to achieve the
mission and objectives.
T - tactics: short-term plans for implementing strategies
Text page 27. |
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Term
| Who developed Classical Organization Theory and what is this theory all about? |
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Definition
Henri Fayol presented his theory in 1916 and it is concerned with the formal structure of organizations and the management roles within that structure. It does not focus on the work rates of individual workers but rather on the technical efficiency of the organization in terms of control, authority, responsibility and accountability. The goal was to formulate universal principles of effective management. This theory differs from Weber's Theory of Bureaucracy in that it was concerned with improving management-worker roles and relationships whereas Weber laid out administrative functions within an organization that can improve efficiency.
Text page 36. |
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Term
| Who developed the Theory of Bureaucracy and what is this theory all about? |
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Definition
Max Weber developed his theory as a set of principles outlining the most appropriate administrative form for the rational and efficient pursuit of organizational goals. This theory differs from Fayol's Classical Organization Theory in that it laid out administrative functions within an organization that can improve efficiency whereas Fayol was concerned with improving management-worker roles and relationships.
Text page 36 |
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Term
| What concept refers to the deliberately planned structure of roles within the organization? |
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Definition
Formal organization
Text page 37. |
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Term
| What concept refers to a network of personal and social relationships that develops in an organization. It is not planned or official, but arises spontaneously as people associate with each other in the workplace. |
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Definition
informal organization
Text page 37. |
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Term
| According to Max Weber, what are the three sources from which authority derive? |
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Definition
1. from tradition (tribal leaders)
2. through charisma (the rise of dictators)
3. via rational, legal procedure (voting, for example)
Text page 38. |
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Term
| What concept is the legitimate exercising of power to influence objects, people and situations: the right to make a decision? |
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Definition
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Term
| What concept is the duty or obligation to perform a task that has been assigned by someone with authority. |
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Definition
Responsibility.
Text page 38 |
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Term
| What concept means being answerable for carrying out responsibilities? In other words, if you do not complete your tasks, you will suffer consequences. |
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Definition
Accountability.
Text page 38. |
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Term
| In the chain of delegation, who delegates duties to the board of directors? |
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Definition
The shareholders.
Text page 39. |
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Term
| In the chain of delegation, who is accountable to the shareholders? |
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Definition
The Board of Directors.
Text page 39. |
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Term
| In the chain of delegation, who formulates policy? |
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Definition
The Board of Directors.
Text page 39. |
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Term
| In the chain of delegation, who implements the policies formulated by the Board of Directors? |
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Definition
The Managing Director.
Text page 39. |
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Term
| In the chain of delegation, who carries out policy in their own departments? |
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Definition
The Functional Mangers.
Text page 39. |
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Term
| This concept describes the number of people directly accountable to and reporting to a manager. |
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Definition
Span of control.
Text page 39 |
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Term
| Identify three advantages to a narrow span of control. |
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Definition
1. close supervision of subordinates
2. tight control
3. fast communication between superiors and subordinates
Text page 40. |
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Term
| Identify four disadvantages to a narrow span of control. |
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Definition
1. superiors too closely involved in subordinates' work
(micromanagement)
2. too many levels of management (structure becomes too
tall)
3. high costs
4. too much distance between top and bottom of
organization
Text page 40. |
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Term
| What is the span of control like in a tall organizational structure? |
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Definition
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Term
| What is the span of control like in a flat organizational structure? |
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Definition
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Term
| What concept refers to the shedding of management layers in tall organizational structures in order to flatten them out? |
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Definition
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Term
| In order for a flat organization to be successful, what three characteristics must the business' staff have? |
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Definition
1. staff must possess a broader skill set than that
required in a tall structure
2. staff must be adaptable
3. staff must develop team skills
Text page 40. |
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Term
| Identify the six internal organizational structures. |
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Definition
1. entrepreneurial
2. functional
3. product based
4. geographically based
5. market segment based
6. matrix
Text page 41.
It is important to know these structures in order to understand the advantages and disadvantages they present in terms of communications efficiency, coordination, flexibility, etc. |
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Term
| Describe the basic characteristics of a centralized organization. |
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Definition
In this type of organization, decisions are made at the upper levels of the organization, leaving little discretion and autonomy to the lower-level workers.
This increases overall control of the business, greater specialization and potentially easier communications. Unfortunately, it can result in excessive bureaucracy (too many hoops to jump through to get anything done), delays in decision-making, diminished initiative and creativity, and often lower worker morale.
Text page 41. |
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Term
| Describe the basic characteristics of a decentralized organization. |
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Definition
In this type of organization, there is considerable delegation of decision-making and lower-level workers can work more autonomously.
This results in clearer recognition of local conditions, more localized decision-making, greater opportunities for personal development, and overall improved worker morale. Unfortunately, this can result in a narrowed departmental view and the potential for significant loss of control.
Text page 41. |
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Term
| Identify the three classifications of communication. |
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Definition
1. media
2. direction
3. degree of formality
Text page 47. |
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Term
| Identify the four forms of media communication. |
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Definition
1. verbal (spoken)
2. non-verbal (expression, tone of voice, posture, etc)
3. written
4. numerical
Text page 47. |
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Term
| What are the three directions of communication? |
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Definition
1. downward
2. upward
3. horizontal
Text page 47. |
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Term
| Communication can be classified one of two ways according to whether or not feedback takes place. What are these two classifications? |
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Definition
One-way or two-way communication.
Text page 48. |
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Term
| Communication can be classified one of two ways depending on whether or not the message is official, approved and specifically arranged by the organization. What are these two classifications? |
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Definition
Formal and informal.
Text page 48. |
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Term
| What three things can result from communication failure? |
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Definition
1. inefficiency
2. failure to reach organizational goals
3. employment relations problems
Text page 50. |
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Term
| Identify five communication nets. |
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Definition
1. the wheel
2. the chain
3. the Y
4. the circle
5. the all-channel
Text page 51 and Figure 4.2. |
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Term
| Which two communication nets are considered to have slow performance and no distinguishable leader? |
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Definition
The circle and the all-channel.
Text page 51, Table 4.3. |
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Term
| Which communication net has low levels of creativity and interaction and is dominated by a central leader yet is considered to be a fast performer? |
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Definition
The wheel.
Text page 51, Table 4.3. |
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Term
| Identify the four broad functional areas of management discussed in the text. |
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Definition
1. marketing
2. accounting and finance
3. production or operations
4. personnel or human resources
Text page 19-20. |
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Term
| Which of the four managerial functions is seen by many people as the heart of the business organization because it is the department in direct contact with the customers the business seeks to serve? |
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Definition
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Term
| Which of the four managerial functions is concerned with identifying and responding to the needs of the customers? |
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Definition
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Term
| Though identified as one function related to the money aspects of the business, the accounting and finance function is actually two different sub-functions: accounting, and finance. Which of these two sub-functions is concerned with collecting, recording, presenting and analyzing financial data? |
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Definition
Accounting.
Text page 21. |
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Term
| Though identified as one function related to the money aspects of the business, the accounting and finance function is actually two different sub-functions: accounting, and finance. Which of these two sub-functions is concerned with raising money for business operations and determining how that money will be spent? |
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Definition
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Term
| Which of the four managerial functions is concerned with the making of goods or provision of services? |
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Definition
Production or operations.
Text page 21. |
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Term
| Which of the four managerial functions involves the coordination of human and other resources to achieve the desired level of output at the lowest cost consistent with satisfying the needs of the customers? |
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Definition
Production or operations.
Text page 21. |
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Term
| Which of the four managerial functions is concerned with the acquisition and deployment of the human resources of the organization? |
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Definition
Human resources or personnel.
Text page 21. |
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Term
| According to Henri Fayol, what are the five tasks common to all managers regardless of their functional affiliation? |
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Definition
1. planning
2. organizing
3. coordinating
4. commanding
5. controlling
Text page 22. |
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Term
Under which managerial function would the following topics fall?
- training and development
- pay
- performance appraisal
- recruitment and selection
- health and safety
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Definition
Human resources or personnel.
Text page 21. |
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Term
| According to Henry Mintzberg, in order to carry out their essential tasks and roles, managers need three broad groups of skills. Identify them. |
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Definition
1. technical skills
2. human skills
3. conceptual skills
Text page 22. |
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Term
| How has the nature of management changed over recent decades? |
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Definition
From boss, supervisor, leader - to team member, facilitator
From reward/punishment - to knowledge/relationship
From individual - to team
From competition - to cooperation
From periodic learning - to continuous learning
From threat avoiding - to opportunity seeking
From resistance to change - to acceptance of change
Page 23, Table 2.2. |
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Term
List Mintzberg's Ten Action Roles of Managers
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Definition
1. figurehead
2. leader
3. liaison
4. monitor
5. disseminator
6. spokesperson
7. entrepreneur
8. disturbance handler
9. resource allocator
10. negotiator
Text page 23, Table 2.1. |
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Term
| What is an act of incorporation? |
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Definition
This is the action taken to create a new legal business entity that is separate from the people who own it. Not only does it stipulate limited liability (shareholder risk), it also empowers the business with certain rights normally given only to human beings: the right to enter into contracts, to sue, and to be sued. Debts of the company are the responsibility of the company, not of individuals within the company. Only after incorporation can a business be called a "company." A sole trader or partnership is never referred to as a "company."
Text page 9. |
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Term
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Definition
These are people who invest their money into public or private companies by way of purchasing ownership shares (stocks) in those companies. The money paid for those stocks is used by the company to finance growth, not daily operations.
Text page 9. |
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Term
| What are the middle three steps in the 9-step decision-making process? |
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Definition
4. analyze the problem/identify constraints
5. formulate alternative solutions
6. evaluate alternatives
Text page 24 and Figure 2.2 |
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