Introduction to business and management J. Timms MN1107, 996D107, 2790107 2011 Undergraduate study in Economics, Management, Finance and the Social Sciences This is an extract from a subject guide for an undergraduate course offered as part of the University of London International Programmes in Economics, Management, Finance and the Social Sciences. Materials for these programmes are developed by academics at the London School of Economics and Political Science (LSE). For more information, see: www.uk This guide was prepared for the University of London International Programmes by: J.
Timms, BA, MSocSci, Researcher at the Centre for the Study of Global Governance, London School of Economics and Political Science. The 2006 and 2009 editions of this guide were amended and updated by A. Benjamin, BSc, MA, Dip Stats, previously at Imperial College Business School. This is one of a series of subject guides published by the University.
We regret that due to pressure of work the author is unable to enter into any correspondence relating to, or arising from, the guide. If you have any comments on this subject guide, favourable or unfavourable, please use the form at the back of this guide. University of London International Programmes Publications Office Stewart House 32 Russell Square London WC1B 5DN United Kingdom Website: www.uk Published by: University of London © University of London 2002, reprinted August 2005, October 2005, and 2006 and 2009 with amendments. Reprinted with minor revisions 2012.
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If you think we have inadvertently used your copyright material, please let us know. Contents Contents Introduction. 1 Aims of the course. 2 Reading and learning resources.
2 Online study resources. 7 Hours of study and using this subject guide. 8 The structure of this course. 11 Section 1: The development of business and management.
13 Chapter 1: Concepts, definitions and origins. 15 Aims of the chapter. 16 Beginning your study .1 The importance of key concepts .2 A closer look at business and organisations.3 A closer look at management.4 The evolution of business and management studies. 25 A reminder of your learning outcomes.
26 Sample examination questions. 26 Advice on answering a question. 26 Chapter 2: Understanding the business organisation – a multidisciplinary approach. 29 Aims of the chapter .1 A multidisciplinary view of business and management .3 The anthropology of organisations .4 The contributions of psychology .5 Economic approaches to organisations.6 The stakeholder model of the firm.
39 A reminder of your learning outcomes. 40 Sample examination questions. 40 Advice on answering a question. 41 Section 2: Decision making.
43 Chapter 3: The management role. 45 Aims of the chapter. 45 i 107 Introduction to business and management Learning outcomes .1 Organisational goals and objectives .2 What is a manager? .3 What do managers do? .4 Decision making and effectiveness. 64 A reminder of your learning outcomes.
65 Sample examination questions. 65 Advice on answering a question. 66 Chapter 4: Theoretical approaches to strategic decision making and organisational change. 67 Aims of the chapter .1 Decision making in business .2 Theories and models for making decisions .4 Analysing the environment.5 Organisational change and development .6 Managing the change process .7 Managing resistance to change.
97 A reminder of your learning outcomes. 97 Sample examination questions. 97 Advice on answering a question. 98 Chapter 5: Managing the main functional areas.
99 Aims of the chapter .1 Functional areas of business organisations .3 Human resource management .4 Production and operations. 119 A reminder of your learning outcomes. 120 Sample examination questions. 120 Advice on answering a question.
120 ii Contents Section 3: Business and the environment. 123 Chapter 6: Key internal elements of the firm. 125 Aims of the chapter .2 Type, ownership, strategy and size .4 New technology and business organisations .5 Understanding organisational culture. 147 A reminder of your learning outcomes.
148 Sample examination questions. 148 Advice on answering a question. 149 Chapter 7: Key external elements of the business context. 151 Aims of the chapter .1 Studying business within its external environment .2 The economic environment .3 The political environment .4 The technological environment .5 The cultural environment.6 Analysing the business environment.
169 A reminder of your learning outcomes. 169 Sample examination questions. 170 Advice on answering a question. 170 Chapter 8: The diverse and dynamic nature of the business context.
173 Aims of the chapter .1 The international context .2 Globalisation and business .3 Management of multinational companies (MNCs) .4 Small business organisations. 190 A reminder of your learning outcomes. 190 Sample examination questions. 191 Advice on answering a question.
191 iii 107 Introduction to business and management Section 4: Contemporary issues in business and management. 193 Chapter 9: Contemporary issues; knowledge management, learning organisations, e-business. 195 Aims of the chapter .1 Dynamics of business and management .3 The learning organisation. 211 A reminder of your learning outcomes.
211 Sample examination questions. 212 Advice on answering a question. 212 Chapter 10: The social responsibilities of business organisations. 215 Aims of the chapter .1 Business in society .2 Business ethics and managerial integrity .3 Business and social responsibilities .4 Corporations as good citizens.
235 A reminder of your learning outcomes. 235 Sample examination questions. 235 Advice on answering a question. 236 Appendix 1: Sample examination paper.
237 Appendix 2: Sources and references. 239 iv Introduction Introduction Welcome to 107 Introduction to business and management. You have chosen to study a dynamic subject that will stretch your knowledge and challenge your ideas. This is an introductory course, which is designed to engage you with the key concepts, models, debates and problems in the study of business and management.
Developing this foundation will be beneficial to your subsequent study of specialised subjects, because you will be able to make connections between different issues. This introductory course is also a chance for you to develop your academic skills, in particular your critical approach to the ideas you are presented with. Studying at this level means actually engaging with what you are reading: considering what is being said in relation to other theories, practical examples, and your own reflections. The subject of business and management offers an ideal opportunity to develop this academic approach, as a wide variety of groups, individuals and organisations offer diverse opinions and theories regarding the workings of business and successful management.
Throughout the course you will be taking an active part in your learning, developing your own responses to what you read and so building a deeper appreciation of issues concerning business and management. It is therefore helpful to view this introductory course as an opportunity to develop a solid framework of knowledge, as well as a critical academic approach. Together these will make your work on this course engaging and stimulating, and will equip you with the tools needed to do well in your future studies. In the remainder of this introductory chapter you will be given advice and guidance on the following: • the course aims and learning outcomes • the reading system • your role in using the subject guide • the structure of the course • preparing for the assessment.
It is important to understand all of these at the beginning to ensure that you are able to get the most out of the course. The subject of business and management is an important and exciting one. You will learn about the workings of business organisations, how they function, and how they interact with the environment. The subject also includes how these business organisations are managed, including the strategies used to guide them and the decisions involved in the role of the manager.
Studying these issues by following the course as it is designed should ensure that although challenging, it will also be an enjoyable and satisfying experience. 1 107 Introduction to business and management Aims of the course This course has three main aims, and these directly relate to the major themes that will be emphasised throughout. The course aims to: • provide a comprehensive introduction to the key elements of the business organisation, and to competing theories and models of the firm and its environment, and to provide a critical perspective on the main functional areas of management • build a foundation of knowledge on the different theoretical approaches to management and decision making • develop analytical skills to identify the links between the functional areas in management, organisations, management practices and the business environment. Learning outcomes On completion of this course, you should be able to: • understand the evolution of the business organisation and management thought, identifying the interconnections between developments in these areas • evaluate alternative theories of management critically, recognising the centrality of decision making and strategic thinking to the managerial role and functions • discuss and compare different models and approaches to understanding the firm, evaluating these in the context of the business environment • explore the impact of key environmental factors on decision making and organisational behaviour • evaluate the significance of contemporary issues in business and management.
Reading and learning resources A vast array of material has been written about business and management, and this is a major reason for the subject being such an interesting one. Many different people, organisations and groups hold widely differing views on issues in this area. You are going to be taking an academic approach to the subject, and this needs to be reflected in your reading. Reading is a vital and central part of your work and successful progress in this course.
It is important that you make use of your academic and study skills handbook Strategies for success. This will really help you, because it includes guidance on reading technique. It is possible for everyone to develop their reading skills, and consciously working on this will be of great benefit to you. This subject guide is designed to guide you through academic material in the major areas of business and management, as set out in the syllabus.
It is important at this stage to understand the reading system, for this will ensure that you cover all the necessary elements of the main topics in a comprehensive way. The reading system that will be employed consists of three elements, which are explained below. 2 Introduction Essential reading For each topic you are required to study some readings that are essential and compulsory. It is from this material that the majority of your knowledge will be gained.
It is therefore vital that you do all the Essential reading specified. All the Essential reading will be listed at the beginning of each chapter. However, it is best to study these readings and the guide in parallel. Therefore you will work from the guide and, at the most relevant points in each chapter, you will be advised which is the relevant reading and when to read it.
Please note that when you are advised to read certain pages in a chapter, this will usually refer to the section that starts and finishes on those pages rather than all the text on them. It will be clear from the subject matter of the section which passages you are intended to read. If you flick through one of the chapters of the guide now, you will see how this will work. Key texts One main key text has been selected for this course: Mullins, L.
Management and Organisational Behaviour.
