Chapter 1 BES 02
Chapter 1 BES 02
Chapter 1 BES 02
PART 1
INTRODUCTION
INTRODUCTORY CASE
When Engr. Romeo Estabillo finished his Civil Engineering course at Mapua Institute
of Technology, he took the board examination and passed it in 1981. Wanting to start
independently, he went back to his hometown (Santiago City) to organize his own
construction firm. In his first few years of operation, he accepted contracts for the
construction of residential houses. As he gained experiences, his clients grew in number,
and even the most prominent persons in Province of lsabela availed of his services.
At the start, he hired two assistants to help him in his daily routine as a contractor.
One of the two assistants, Mr. Silvino Santiago, was a third-year civil engineering student
who had stopped schooling due to financial difficulties. His task was as draftsman. His duty
was to produce all documents relating to physical requirements of the various contracts
entered into by boss. Among the documents are the building plan, specifications, bill of
materials, building permit, etc. His additional duty was to assist Engineer Estabillo in
supervising the foremen and workers at the various construction sites.
The second assistant, Mr. Romulo Mamaril, was assigned to coordinate purchasing,
bookkeeping, and other related administrative activities.
At the third year of operations, Engr. Estabillo was already directing operations in
his newly constructed office inside his residential compound. By this time, two more female
employees were hired to assist in the various tasks performed in the office.
By 1994, Engr. Estabillo reviewed his company’s payroll. It indicated that he has six
full-time civil engineers, two draftsmen, ten administrative personnel, one messenger, and
one security guard. The foremen and laborers working at the various projects were
contractual.
By June, 1996, Engr. Estabillo felt that business was continuously growing, so he
will have to secure the services of four additional civil engineers on a full- time basis. As he
was directly supervising all operations, he now feels that he may not be able to perform his
functions effectively if he will push through with the plan. He wants to make a decision, but
he is apprehensive. He thinks operations are now more complex. With this thought, he
pondered on how he will go about solving the problem.
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ENGINEERING MANAGEMENT
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CHAPTER 1
The 21st century is here. In the new workplace everyone must respond and adapt to a rapidly
changing society with constantly shifting demands and opportunities. Learning and speed are in; habit and
complacency are out. This is the theme that drive the popular magazine Fast Company and its mission to
be a handbook of the business revolution. While noting that it is hard to comprehend the new world of
work at the very time that it is being rapidly created, Fast Company reports the importance of these core
understanding for anyone who seeks career success today. Organizations are fast changing; the nature of
work itself is changing; the global economy is driven by the innovation and technology; even the concept
of success; personal and organizational, is evolving. These developments say Fast Company’s editor affect
us all and offer “unparalleled opportunity and unprecedented uncertainty”. And in this age of continuous
challenge, a compelling message must be heard – smart people and smart companies create their own
futures!
WHAT IS AN ORGANIZATION?
It is composed of people, one person working alone is not an organization, and it takes people to
perform the works necessary to achieve its goals.
And a structure that may be open and flexible – with no clear duties and precise job duties or
strict adherence to explicit job arrangements – hence, a simple network of loose relationships or it may be
traditional with clearly defined rules, regulations and job descriptions. But no matter what type of
structural arrangement an organization uses, it does require some deliberate structure so members’ work
relationships are clarified.
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Although the above three characteristics are important in the definition of what an organization
is, the nature of an organization is changing.
Why are organizations changing? Because the world around them has changed and will continue
to change. Societal, economic, global and technological changes have created an environment in which
successful organizations (those that consistently attain their goals) must embrace new ways of getting
work done.
As the above list show, today’s organizations are becoming more open, flexible and responsive to
changes.
WHAT IS MANAGEMENT?
ENGINEERING MANAGEMENT
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As managers use their resources, they must strive to be both effective and efficient.
Efficiency Effectiveness
(Means) (Ends) Managerial Effectiveness refers to management use
of organizational resources in meeting organizational
goals. It is often described as “doing the right things” –
that is doing those work activities that will help
Resource Usage Goal Attainment
organization reach its goals.
Low High
Wastage Attainment
Managerial Efficiency is the degree to which
organizational resources contribute to productivity. It
refers to getting the most output from the least amount
Management Strives for: of inputs.
Low Resource Waste (high efficiency)
High Goal Attainment (high effectiveness
As reflected in figure, efficiency is concerned with the means of getting things done;
effectiveness is concerned with the ends or the attainment of organizational goals.
Efficient
(most resources Not reaching goals and Reaching goals and not
U S E
Inefficient
(few resources Not reaching goals and Reaching goals and
contribute to wasting resources wasting resources
production0
Ineffective Effective
(little progress toward
(substantial progress
organizational goals)
toward organizational
goals)
G O A L A T T A I N M E N T
Based on the above matrix the concepts of managerial effectiveness and efficiency are obviously
related. A manager could be relatively ineffective – within the consequence that the organization is
making very little progress toward goal attainment – primarily because of major inefficiencies or poor
utilization of resources during the production process. In contrast, a manger could be somewhat effective
despite being inefficient if demand for finished goods is so high that the manager can get an extremely
high price per unit sold and thus absorb inefficiency costs. Poor management is most often due to both
inefficiency and ineffectiveness or to effectiveness achieved through inefficiency.
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It used to be fairly simple to define who managers were: They were the
organizational members who told others what to do and how to do it. It was easy
to differentiate managers from non-managerial employees; the latter term
described those
organizational
members who worked
directly on a job or MANAGER:
task and had no one reporting to them. But it - is someone who coordinates and oversees the work of
isn’t quite simple anymore. The changing other people so that organizational goals can be
nature of organizations and work has, in accomplished. Serving in positions with a wide variety
many organizations, blurred the distinction of titles, they mobilize people and resources to
between managers and non-managerial accomplish the work of organizations and their
employees. Many traditional non-managerial subunits.
jobs now include managerial activities.
Within a single shift, an employee can be team leader, equipment operator, maintenance technician,
quality inspector or improvement planner.
A manager’s job is not about personal achievement – it’s about helping others do their work.
This may mean coordinating the work of a departmental group, or it might mean supervising a single
person. It could involve coordinating the work activities of a team composed of people from several
different departments or even people outside the organization, such as temporary employees or
employees who work for the organization’s suppliers. Keep in mind, also, that managers may have other
work duties not related to coordinating the work of others. For example, an insurance claims supervisor
may also process claims in addition to coordinating the work activities of other claims clerks.
In a traditionally structured organizations (pyramid shaped) the types of managers are often
described as:
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Top Managers – responsible for making organization-wide decisions and establishing the plans and
goals that affect the entire organization. They should pay special attention to the external
environment, be alert to potential long-run problems and opportunities and develop appropriate
ways of dealing with them. (i.e. president, executive vice president (EVP), chief executive officer
(CEO), chief operating officer (COO), etc)
Middle Managers – include all levels of management between the first level and the top level of the
organization. They report to top managers and oversee the work of large departments or divisions.
They should be able to develop and implement actions plans consistent with higher level objectives.
They should also be team oriented and able to work with peers to help coordinate activities across
the organization. Especially today, middle managers are assuming new responsibilities for
implementing complex projects that require the participation of persons from different parts of
organization. (i.e. regional manager, project leader, plant manager, division manager etc.)
First-Line Managers – the lowest level of management; manage the work of non-managerial
employees (a.k.a. operatives) who are typically involved with producing the organization’s products
or servicing the organization’s customers. (i.e. supervisor, team leader, shift manager, district
manager, department manager, office manager, foreperson)
Managers
serve
support
First-Line Managers TEAM LEADERS
Helps the operating workers do their
jobs and solve problems
support
Non-managerial
Employees TOP MANAGERS
Keep org n. mission
Upside down
& vision clear
view of an
organization
Managerial Pyramid
Not all organizations get work done by using the above traditional pyramidal form. Among the
many changes affecting managerial work today, the concept of the “upside-down pyramid”, present in
nimble organizations, is one of the most symbolic. This view offers a new way of looking at organizations
and the people within.
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Describing what managers do isn’t easy or simple. Just as no two organizations are alike, no two
managers’ jobs are alike. Despite this fact, management researchers have, after many years of study,
developed three specific categorization schemes to describe what manager do: functions, roles and skills.
Management Functions
PLANNING
The management process involves the
Setting performance objectives
and deciding how to achieve
four function of management as depicted in
them Fig. 1.7. All managers are responsible for the
four functions, although research suggests that
the relative emphasis on each can vary
somewhat by managerial level. Top managers
CONTROLLING THE ORGANIZING
Measuring performance and Arranging tasks, people and may spend relatively more time on planning
taking corrective action to
MANAGEMENT other resources to
ensure results PROCESS accomplish the work and organizing functions, while first-line
managers may spend more time on control.
Time spent in leading/influencing appears
relatively consistent across all management
INFLUENCING
Inspiring people to work hard to levels.
achieve high performance
Planning – defining goals, establishing strategy and developing plans to integrate and coordinate
activities.
Organizing – determining what needs to be done, how it will be done and who is to do it.
Influencing – motivating, leading and any other actions involved in dealing with people.
Controlling – monitoring activities to ensure that they are accomplished as planned
In reality, what managers do may not always happen in the above sequence. But that doesn’t
negate the importance of these functions. Regardless of the order in which they are performed, the fact
is that managers do plan, organize, influence and control as they manage.
Management Roles
The term management role refers to specific categories of managerial behavior. (think of the
different roles you play – student, employee, student group member, sibling and so forth – and the
different behaviors you’ve expected to play in these roles). As shown in Table 1.2, Mintzberg’s 10
management roles are grouped around interpersonal relationships, the transfer of information and
decision making.
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Decisional roles – entail making decisions or choices; involve using information to make
decisions to solve problems or address opportunities
Disturbance Responsible for corrective action when Organizing strategy and review
Handler organization faces important, unexpected sessions that involve
disturbances. disturbances and crises
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Management Skills
A manager’s job is varied and complex. Managers need certain skills to perform the duties and
activities associated with being a manager. A skill is an ability to translate knowledge into action that
results in desired performance. The most important managerial skills are those that allow managers to
help other become more productive in their work. Robert L. Katz concluded that managers needed the
following three essential skills:
Technical Skill – job-specific knowledge and techniques needed to proficiently perform specific tasks;
expertise that could initially be acquired through formal education and are further developed by
training and job experience. These skills tend to be more important for lower level of managers
because they typically are managing employees who are using tools and techniques to produce
organization’s products or service the organization’s customers.
Human Skill – ability to work well with other people individually and in a group. It emerges in the
workplace as a spirit of trust, enthusiasm and genuine involvement in interpersonal relationships.
These skills are consistently important across all levels of management because managers deal
directly with people. Manager with good human skills are able to get the best out of their people.
They know how to communicate, motivate, lead and inspire enthusiasm and trust. A manager with
good human skills will have a high degree of self-awareness and a capacity to understand or
empathize with the feelings of others.
Conceptual Skill – ability to think and formulate (conceptualize) about abstract and complex
situations; it involves the ability to break down problems into smaller parts, to see and analyze the
relations between parts and to recognize the implications of any one problem for other to solve
complex problems. Using these skills managers must see the organization as a whole, understanding
the relationships among various subunits and visualize how organization fits into broader
environment. These skills are most important at the top management level.
Other managerial skills were identified in a survey of practicing managers by the American
Management Association (AMA). These skills are described in Table 1.3.
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In today’s demanding and dynamic workplace, employees who want to be a valuable assets to an
organization must be willing to constantly upgrade their skills and take on extra work outside their own
specific job area. There’s no doubt that skills will continue be an important way of describing what a
manager does.
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GLOBALIZATION
“Going Global” as a business enterprise often means adopting products to fit local needs around
the world. A global business views itself as equidistant from all customers, wherever in the world they
may be located.
Managers are no longer constrained by national borders. BMW builds cars in South Carolina;
McDonald’s sell hamburgers in China; Toyota makes cars in Kentucky; Coca-Cola built bottling plants in
Southeast Asia; Lego Group opened factories and distribution centers in Czech Republic etc. As these
examples illustrate, the world has definitely become a global village, leading to important changes in the
manager’s job such as:
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Increasingly, we notice the “moral” aspects of everyday managerial and business behavior.
Society is becoming strict in its expectation that social institutions conduct their affairs according to high
moral standards. The pressure for ethical and socially responsible conduct is on, and organizations and
their managers must respond to it accordingly. In addition to concerns for the natural environment,
ethical and social responsibility issues extend into all aspects of organizations, the behavior of their
employees and the changing needs of an increasingly global economy.
WORKFORCE DIVERSITY
One of the most important issues currently facing managers is coordinating efforts of diverse
organizational members in accomplishing goals. Today’s organizations are characterized by “workforce
diversity” – a workforce that is heterogeneous in terms of gender, race, ethnicity, age and other
characteristics that reflect differences.
Many organizations are rapidly embracing the efficiencies of computer and capital-intensive
technologies. As technological change accelerates, the demand for workers with the skills to utilize
technology to its full advantage also increases. Low-skills workers displaced from declining manufacturing
industries will find it increasingly difficult to find new jobs offering adequate pay.
The new century brings it with new social values and expectations for the protection of human
rights in all aspects of society, including employment. Employees are demanding more self-determination
on the job – they want to be part of everyday decisions on how and when to do their job, and they expect
real opportunities to participate in job-related decisions. Concerns abound for employees’ right to
privacy, due process, protection against job discrimination and freedom from sexual harassment.
Controversies over computerized work monitoring and employee testing for substance abuse, AIDS, and
honesty also appear in the news. And job security is a concern at a time when many organizations are
cutting back their full-time workers and hiring more part-time or contingency workers.
In a world where change is occurring at an accelerating rate, the impact of emerging information
and computer technology must be appreciated. This is the new age of “knowledge worker” - someone
whose mind is a critical asset to employers. Computer literacy is a knowledge component that must be
mastered as a foundation for career success.
The typical career of the 21st century won’t be uniformly full time and limited to a single large
employer. It is more likely to unfold opportunistically and several employment options over time. Skills
must be portable and of value to more than one possible employer; these skills must be carefully
maintained and upgraded over time. You must maintain a “portfolio of skills” that are always up-to-date
and valuable to potential employers.
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Another reason for studying management is the reality that for most of us, once we graduate
from college and begin our career, one will either manage or be managed. For those who plan to be
managers, an understanding of the management process forms the foundations upon which to build your
management skills. On the other hand, for those of us who don’t see himself managing, one is likely to
have to work with managers. Also, assuming that we will have to work for a living and recognizing that
we are very likely to work in an organization, one probably have some managerial responsibilities even if
one is not a manager.
Rewards Challenges
• Create a work environment in which • Do hard work
organizational members can work to the best of • May have duties that are more clerical than
their ability managerial
• Have opportunities to think creatively and use • Have to deal with a variety of personalities
imagination • Often have to make do with limited resources
• Help others find meaning and fulfillment in work • Motivate workers in chaotic and uncertain
• Support, coach and nurture others situations
• Work with a variety of people • Successfully blend knowledge, skills, ambitions
• Receive recognition and status in organization and experiences of a diverse work group
and community • Success depends on others’ work performance.
• Play a role in influencing organizational outcomes
• Receive appropriate compensation in form of
salaries, bonuses and stock options
• Good managers are need by organizations
Table 1.4 - Reward and Challenges of Being a Manager
Managers often may have to deal with a variety of personalities and often have to make to with
limited resources. It can be a challenge to motivate workers in the face of uncertainty and chaos.
Managers may find it difficult to effectively blend the knowledge, skills, ambitions and experiences of a
diverse work group. Finally, as a manager, you’re not in full control of your destiny. Your success typically
is dependent upon, others’ work performance.
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Name: Score:
Date:
EXERCISE 1.1
A 21ST CENTURY MANAGER?
Instructions:
Rate yourself based on the following characteristics. Use this scale:
S = Strong, I am very confident with this one
G= Good, but I still have room to grow
W= Weak, I really need to work on this one
U= Unsure, I just don’t know
1. Resistance to Stress: the ability to get work done even under stressful conditions.
2. Tolerance for Uncertainty: the ability to get work done even under ambiguous and
uncertain conditions
3. Social Objectivity: the ability to act fee of racial, ethnic, gender and other prejudices or
biases.
4. Inner Work Standard: the ability to personally set and work to high performance
standards.
5. Stamina: the ability to sustain long work hours.
6. Adaptability: the ability to be flexible.
7. Self-confidence: the ability to be consistently decisive and display one’s personal
presence.
8. Self-Objectivity: the ability to evaluate personal strengths and weakness and to
understand one’s motives and skills relative to a job.
9. Introspection: the ability to learn from experience, awareness and self-study
10. Entrepreneurism: the ability to address problems and take advantage of opportunities
for constructive change.
ENGINEERING MANAGEMENT