Module 4: Management of Organizations Professor Cristina Banks firstname.lastname@example.org Office Hours: Mondays 2-3:30 @ F526 The Conceptual Framework • Status Report: The Current State of the U.S. Workforce • Implications for Business • Fundamental Building Blocks for a Company • Fast Food Wars—How to win? • Developing the Management Team Workforce Generations • Baby Boomers (b. 1946 – 1964) • Baby Busters (b. 1965 – 1983) • Baby Boomlets (b. 1984 – 2002) Status Report: The context for managing people. • The workforce is getting older. More Boomers in current workforce than other two generations. Average age of workforce around 45. Boomers nearing retirement. Large wave of retirements expected starting in 2010 Status Report • The workforce is getting smaller—fewer people entering the workforce than those leaving the workforce. 77 million Boomers will be replaced by 66 million Busters 11 million person gap By 2008, the number of young adult workers entering the labor force (25-40) will shrink by 1.7 million. Status Report • The workforce is becoming more ethnically diverse. By 2020, US population will be 63% White, 13% African American, 7% Asian, 16% Hispanic. In CA, population will be 40% White, 60% minorities and immigrants speaking over 80 languages. In CA, Hispanic population growth rate is the highest in absolute numbers Asian population is most rapidly growing minority group in US Status Report • The workforce is becoming less well- educated. High school graduation rates are declining. High school drop-out rate up to 25% for minorities. 25% of high school graduates cannot read at 8th grade level. Status Report • More jobs available that require skills; fewer jobs available for unskilled workers. 52% of high school graduates lack the basic skills required to do their jobs adequately. 80% all jobs will require some sort of post-secondary education. 97% of youth hope to go to college, 63% enroll, 30% receive bachelors degrees. By 2010, 167 million skilled jobs will be filled by only 157 million skilled workers. The Problem • Too few workers coming into workforce. • Widening skill gap: more skilled jobs, fewer skilled workers. • Greater ethnic diversity, and more complex management . • Greater competition for skilled workers globally. Implications for Business • Job vacancies in areas we can least afford. • Greater need for cultural awareness and ways of managing diverse cultures sensitively. • Growing segment of US workforce that cannot qualify for higher paying jobs. • Increasingly difficult to retain talented people in a company. Solutions • Develop the personal and professional skills of your employees—to increase the overall skill level of the workforce. • Manage employees’ performance to maximize the talent we have. • Increase satisfaction of workers to build loyalty and commitment. • Utilize talent wherever it is found. Where To Start What are the fundamental building blocks of a company? Building Blocks Of A Company • Mission: The company’s purpose and how it will achieve its purpose. • Business Goals: The company’s performance targets—how it measures success. • Business Strategy: Overarching plans and programs that outline how the company will meet its goals. • Organizational Culture: Norms and values that guide how employees behave in the company. Strategy Formulation Figure 5–2 The Fast Food Wars: Who’s Winning in this Space? McDonalds Vs. In-N-Out The Mission McDonalds: In-N-Out: “To be the world’s best quick “To give customers the service restaurant freshest, highest quality experience. Being the best foods you can buy and means providing provide them with friendly outstanding quality, service in a sparkling service, cleanliness and clean environment.” value, so that we make every customer in every restaurant smile.” The Mission • McDonald’s Customer experience • In-N-Out Fresh food Who they want to be to the customer dictates how the organization is built and operates. Environmental Analysis: Things They Might Be Concerned About • Customer food tastes • What customers spend their money on • General economy and how much money people have to spend • How many people in the workforce are available to work in the restaurants, especially managers Organizational Analysis: Things They Might Be Concerned About • How much money they have to spend each month (cash flow) • How much turnover they have among managers • How resistant managers are to change efforts • How many talented employees intend to be managers • Operational (in)efficiencies Corporate Strategy: Overall Way the Company will Grow and Manage its Business • Open new stores • Grow customer base • Improve efficiencies (cut costs) • Acquire competitors Business Strategy: Plans for Improving Competitive Position • McDonald’s “Plan to • In-N-Out Win” Fresh, best-tasting People products Products Loyal, highly Place effective Price management and staff Promotion Functional Strategies: Plans at the Restaurant Level McDonald’s: In-N-Out: • Offer new products that • Make the best-tasting customers want. • Batch cook product. hamburger at a reasonable • Improve recruitment of price. employees by offering • Cook orders one at a time. attractive training and • Employ friendly, hard- benefits • Improve retention of mgrs working, and loyal people. • Reduce costs through waste • Pay above market and control, operating promote from within efficiencies. Building the Management Team: What should managers be focused on? • Planning: Determining what is best to do and how best to get it done. • Organizing: Determining how best to arrange an organization’s resources and activities. • Directing/Leading: Guiding and motivating employees to meet objectives. • Controlling: Monitoring performance to ensure goals are being met.
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