Even more than management, technical individuals require specific leadership qualities. Leadership and management are interwoven in the new economy; nonetheless, these two concepts can be clearly separated. Leaders inspire others, while managers manage them. Leaders have long-term viewpoints, whereas managers have short-term ones. Leaders grow and try to understand people and the source of their problems, whereas managers simply maintain and focus on the way things are done (Klingner, Llorens & Nalbandian, 2010).
The nature of leadership is to make people do what they do not want to do and to make them enjoy their job. According to Sir William Slim, the commander of the British Army, leadership can be explained as “A mixture of persuasion, compulsion, and example that makes men do what you want them to do” (Klingner, Llorens & Nalbandian, 2010)
There are four major categories of leadership:
Physical qualities, dealing with health, energy and patience.
Personal attributes, including cooperativeness, enthusiasm, ability to motivate, persuasiveness and discretion.
Character attributes, which deal with integrity and humanism
Intellectual qualities, such as mental ability, and scientific approach to problems.
There are many types of leadership, the choice of which is defined based on the situation requiring it. Autocratic leadership is one, in which manager makes decisions alone without considering others. Diplomatic leadership is observed in case the manager makes decision and persuades subordinates to accept them. In consultative leadership the manager accepts ideas from sub-ordinates and uses them decision-making. Participative leadership is when sub-ordinates play a decisive role in decision-making.
Motivation
Motivation is defined as the amount of internal and external factors, which stimulate people to work and achieve the set goals. One more definition is the desire of people to use maximum efforts to reach the set goals in order to satisfy the desire of the needs of someone.
Major motivation theorists are McGregor, Maslow and Herzberg. McGregor’s theories are theory X and theory Y. The theory X focuses on external factors that control human behavior, theory Y focuses on self-direction and self-control. According to Maslow, there is the hierarchy, underlying the satisfaction of needs based on their priority. According to Herzberg’s 2-factor theory, there are several important factors, influencing job: achievement, recognition, work itself, responsibility, growth, supervision, interpersonal relationships, working conditions, salary, status, and security that are external to job (Daft & Marcic, 2011)
Chapter 4: Planning and Forecasting
Planning is one of the most important stages of work in each organization is an important process for the success of any organization, because it helps define the plan of actions and means of their achievement as well as establish objectives (Blazey, 1997)
The most common planning process for problem resolution is the scientific method, when solution is found after the problem has been properly analyzed and discussed. In the process of finding proper solution, all alternatives are weighed against each other for the most proper solution or combination of solutions to be found.
Each organization implements its own strategic planning, which is very important in creating strategies and vision statement, so vision statement is neither a business plan nor an operational plan. It is definition of the long-term aims of the organization, while mission statement defines short-term aims of the company. The company is able to achieve its goals only when it has defined its mission and vision. Goals define what directions are to be taken to align them with its vision and mission statements. Objectives are quantifiable, attainable and verifiable and help measure the progress of the project (Blazey, 1997).
Strategies are the steps that, created for the achieving organizational objectives. The SWOT (strength, weakness, opportunities, threats) technique is used to set the strategies of any organization. The strengths and weaknesses of the organization are possible to control, while opportunities and threats can be adjusted. Strengths are the factors, making the organization better on the background of its competitors, while weaknesses are the factors to be used by the competitors to affect the organization. Opportunities are situations, affecting organization’s advantage positively. Threats are the situations, influencing the organization negatively (Jurevicius, 2013).
Management by objectives improves organizational performance through clear definition of objectives, agreed by superiors and subordinates and clearly defines the roles of responsibilities of all employees, improves communication, increases motivation and ethical situation in the company (Blazey, 1997). The only limitation of this approach is the likelihood of the employees to work more like robots to reach goals, leaving behind all the personal feelings.
Forecasting is the process, used to estimate the future outcomes of the strategies Forecasting helps promote new businesses, estimate financial requirements and enhances the long-term planning (Likert, 1967). The Expert opinion method, Delphi method, Salesforce opinion, and Customer survey method are the types of qualitative methods of forecasting. Simple moving average, weighted moving average, Exponential smoothing and Multiple regression belong to the quantitative methods of forecasting. Delphi method is the most useful, according to which a panel of experts estimates the future changes in the technical breakthroughs considering the current state of technology.
Due to technological advances and increase of innovations, technologies change the organizations rapidly, thus posing challenges to managing the technologically advanced organizations. With the use of internet and social media, organizations announce product information, increase public issues, provide technical aid, and stay in touch with the customers.
Chapter 5: Decision Making
Decision Making is a process, during which the person chooses from different ideas or products in order to find the best solution (Ahmed, 2009). Decision making is an essential part of the planning phase, as planning defines what, when and how to do, while decision- making influences staffing, motivation and solving problems.
Types of decisions
Decisions are routine or non-routine based on the extent of their structure. Decisions, taken in the past are routine, while those that are new are non-routine. Decisions are also distinguished as objective or bounded based on their rationality. Objective decisions are about choosing the best possible alternative, while bounded decisions are about choosing an alternative, which is acceptable, but does not always the best one.
Management focuses on quantitative approach for problem solving. For problem solving, management science (i) considers all possible variants of the problem, (ii) team approach (iii) uses mathematical methods. Scientific method of problem solving has several stages: problem definition, data collection, and hypotheses development, test hypotheses, analysis of results and drawing conclusion (Likert, 1967). Engineering method for problem solving includes the following stages: problem definition, collection and data analysis, alternatives search and evaluation and solution selection.
Decision-making tools
Classifications of decision-making are: Under certainty, under risk and under uncertainty (Baker et al, 2002). Under certainty decisions suggest that there is enough information to predict the outcome. Under risk decisions suppose that the information available is enough for the outcome estimation. Under uncertainty decisions suggest the absence of information to understand the outcomes.
Linear programming is used in the process of making decisions under certainty. Here the desired product is expressed in mathematical functions using several variables. Decisions under risk are based on Expected value, Decision trees, Queuing and Simulation techniques (Baker et al, 2002). According to the expected value theory, managers make risky decisions aimed at maximizing the expected utility of profit. Decision trees represent series of decisions and actions in problem solving in the form of graphics. Queuing theory is the mathematical representation of waiting lines, used to estimate the fluctuation probability. Simulation is a process of creation of a model of a prototype to identify the factors that can probably influence the behavior of the team (“Baker et al, 2002).
Maximax, Maximin, Hurwicz and Equally likely approaches are used when decisions taken under uncertainty are made. Maximax approach chooses the best alternative. Maximin approach looks at the worst that is possible to happen under every alternative and then chooses the alternative that has the largest payoff (Baker et al, 2002).Hurwicz theory is an approach, having something between the Maximax and the Maximin. Equally likely approach searches for all the possible equally probable alternatives.
Decision making is critical for the organizational success. With the computerized era decision-making has become more depended on technologies. Decision-making has become easier due to the access to integrated databases, management information systems and expert systems Data integration is used in different organizations. According to “Management information systems (MIS), “management information system (MIS) is a database of financial information, which contains reports and data of performance of the organizations and provides access, in case the decision-making is required. MIS helps get the feedback of the performance of the organization and track the progress of the project. Another significant approach for facilitation of decision-making is a computer application, called expert system (“Expert system,” 2016).
References
Blazey, M. (1997). “Achieving performance excellence”. Quality Progress, 30(6), 61-64.
Baker, D., Bridges, D., Hunter, R., Johnson, G., Krupa, J., Murphy, J. and Sorenson, K. (2002) Guidebook to Decision-Making Methods, WSRC-IM-2002-00002, Department of Energy, USA. Retrieved from http://emi-web.inel.gov/Nissmg/Guidebook_2002.pdf
Expert System. (June, 2016). Retrieved from http://searchhealthit.techtarget.com/definition/expert-system
Daft, R.L., & Marcic, D. (2011). Understanding Management. Mason, OH: South-Western, Cengage Learning
Jurevicius, O. (2013, February 13). SWOT Analysis - Do It Properly! [Web log post]. Retrieved from https://www.strategicmanagementinsight.com/tools/swot-analysis-how-to-do-it.html
Klingner, D., Llorens, J., & Nalbandian, J. (2010). Public personnel management: Contexts and strategies. New York, NY: Pearson Education, Inc.
Likert, P. (1967). New patterns of management. New York: McGraw-Hill.
Management Information Systems (MIS). (n.d.). Inc..Retrieved from http://www.inc.com/encyclopedia/management-information-systems-mis.html
Teasley, D. (n.d.). Lesson 18: What Is Behavior Modification? - Definition, Techniques & Examples. Retrieved from http://study.com/academy/lesson/what-is-behavior-modification-definition-techniques-examples.html
Qadeer Ahmed. (2009). Managerial decision making [PowerPoint slides]. Retrieved from http://www.slideshare.net/greatqadirgee4u/managerial-decision-makings
