GLOBAL This is a special edition of an established title widely used by colleges and universities throughout the world. Pearson published this exclusive edition GLOBAL EDITION for the benefit of students outside the United States and Canada. If you EDITION EDITION GLOBAL purchased this book within the United States or Canada, you should be aware that it has been imported without the approval of the Publisher or Author. Modern Management Today’s managers continue to face exciting new opportunities and challenges.
The fifteenth edition of Modern Management: Concepts and Skills combines the most seminal perspectives on management with the most current studies in the Concepts and Skills field to fulfill two objectives: maximize the student’s understanding of critical management concepts and develop related management skills. Cutting-edge research on individuals, teams, and organizations is integrated with the following features to enhance students’ performance, their employability, and their careers. • Challenge Cases at the beginning of each chapter present a company facing a challenge relevant to the topic of the chapter. Challenge Case Summaries at the end of each chapter demonstrate how managers have used the concepts presented Modern Management in the chapter to address the challenge.
• Tips for Managing Around the Globe, Steps for Success, and Practical Challenge callouts highlight the practical applications of management concepts. FIFTEENTH EDITION • Management Skills Exercises provide additional discussion questions for the Challenge Case as well as an additional short case. • Three Experiential Exercises at the end of each chapter help students to use Concepts and Skills active learning, manage their careers, and demonstrate the knowledge and skill acquired in that chapter. FIFTEENTH EDITION Certo • Certo Samuel C.
Trevis Certo Certo_15_1292265191_Final.indd 1 11/1/18 3:51 PM 30 PREFACE Global Edition Acknowledgments Pearson would like to thank the following people for their work on the Global Edition: Contributors Diane Sutherland Jon Sutherland Reviewers Lindos Daou, Holy Spirit University of Kaslik Khaled Haque Vimala Venugopal, Taylor’s University, Malaysia A01_CERT5193_15_GE_FM.indd 30 24/09/18 2:49 PM Introducing Modern 1 Management: Concepts and Skills TA R G E T S K I L L Management Skill: the ability to work with people and other organizational resources to accomplish organizational goals M A N AG E M E N T S K I L L A N D YO U R C A R E E R Management skill will be of great value to you in enhancing your career. For example, this skill can help you to focus systematically on engaging organizational resources to meet profit goals. Profit making will contribute to organizational success, build your image as a competent manager, make you valuable to your organization, and support promotions as you build your career. OBJECTIVES To help build my management skill, when studying this chapter, I will attempt to acquire: 1-1 An understanding of a manager’s task 1-3 An understanding of management 1-2 Knowledge about the management skill as the key to management process and organizational success resources 1-4 Insights concerning what management careers are and how they evolve MyLab Management Chapter Warm Up If your instructor has assigned this activity, go to www.com/mylab/management to complete the chapter warm up.indd 31 14/09/18 2:35 PM CHALLENGE CASE Coke’s New CEO Battles a Changing Market T his chapter focuses on a number of introductory management topics, but one key concept is that of management employability skills (communication, criti- cal thinking, creativity, collaboration, knowledge applica- Pascal Le Segretain/Getty Images tion, and ethics and social responsibility).
The new CEO of Coca-Cola is a great example of all six of these man- agement employability skills. Coca-Cola is a brand that has been around for over 130 years. The iconic logo script, contoured shape of the bottle, and bubbly taste have made Coke one of the most recognizable brands in the world. The beverage giant has enjoyed a worldwide popularity envied by most consumer companies.
How- ever, the last 10 years have been tough on Coke and on James Quincey, new CEO of The Coca-Cola Company, the carbonated beverage industry in general. Bottled will need his broad-based knowledge to face current water has supplanted soda as the most commonly pur- competitive challenges. chased drink in the United States, and cities have begun taxing carbonated beverages heavily in hopes of raising funds and curbing obesity and diabetes. sold off bottling operations since 2012.
This is important as In this current turbulent climate, James Quincey took the company refocuses its efforts on products such as the reins as CEO of the soda giant in 2017. Beginning his sports drinks, tea, plant-based beverages, bottled water, career with Coke in 1996, he oversaw operations in Latin and flavored water—a major departure from the tried-and- America and Europe and worked his way up to chief oper- true carbonated namesake of the firm. ating officer, learning along the way the employability skill Quincey understands that if Coke is to continue to com- of knowledge application. Each position he filled in his pete with Pepsi and Dr.
Pepper Snapple, he has to create career with the company taught him something new that new revenue streams while significantly cutting costs. This he could utilize in subsequent positions. The former CEO, means making tough decisions about reducing staff and Muhtar Kent, had held the position for 8 years and taking risks with the introduction of new products. As con- groomed Quincey to take over the helm upon his sumers seek out healthier options, the beverages of 20 years departure.
ago are no longer the top sellers. People want less sugar and Quincey has a number of challenges ahead of him fewer calories, and they want to feel good about what they requiring critical thinking skills. Currently the firm’s soda are consuming. This embodies the employability skill of eth- sales account for 70 percent of global revenue.1 And though ics and social responsibility.
Coke’s voluntary decision to that number is impressive, it is also a daunting figure manufacture a beverage that helps contribute to the reduc- because sales of carbonated beverages are steeply declin- tion of diabetes and the number of obese consumers dem- ing. In addition, the company is downsizing its number of onstrates the company’s commitment to implementing employees as it tries to enter new beverage markets. These strong ethical and socially responsible choices. It will be cru- are major trials for the 52-year-old Quincey.
The critical cial for Quincey to communicate with his team about this thinking skills needed to tackle these issues showcase trend. This is a critical management employability skill that Quincey’s ability to use purposeful, goal-directed thinking is highly desirable by organizations, and Quincey’s ability to to define and solve these problems. convey the information effectively to his associates will be “We are moving quickly to structure our organization critical for Coke’s success. for faster growth and to ensure we can respond to the fast- Coke, under Quincey, is entering a new era where delib- changing needs of our consumers,” Quincey said.2 The erate management initiatives will maintain the strong mar- restructuring has meant cutting 1,200 jobs at the corporate ket position the company has enjoyed.
However, changes to office on top of the nearly 100,000 jobs lost as Coke has a company built on a single carbonated beverage product 32 M01_CERT5193_15_GE_C01.indd 32 14/09/18 2:35 PM CHAPTER 1 Introducing Modern Management: Concepts and Skills 33 are a necessity. In addition, Quincey is effectively demonstrating the six management employability skills that are discussed in this chapter. According to Quincey, “The brand Coca-Cola will always be the heart and soul of The Coca-Cola Company, but the company has outgrown its core brand. The company needs to be bigger than our core brand.
We’ve been very clear that for us to drive sustainable, profitable growth of our brands, we also need to encourage and enable our consumers to control added sugar consumption.”3 THE MODERN MANAGEMENT CHALLENGE The Challenge Case illustrates a few of the ways that James Quincey will need his personal management skills at Coke. After studying chapter concepts, read the Challenge Case Summary at the end of the chapter to help you to relate chapter content to developing management skills to inspire innovation. A Manager’s Task Managers influence all phases of modern organizations. Plant managers run manufacturing 1-1 An understanding of a operations that produce the clothes we wear, the food we eat, and the automobiles we drive.
manager’s task Sales managers maintain a sales force that markets goods. Personnel managers provide organi- zations with a competent and productive workforce. The “jobs available” section in the classi- fied advertisements of any major newspaper describes many different types of management activities and confirms the importance of management. Managers are also important because they serve a very special purpose in our lives.
They are the catalysts for new and exciting products of all kinds that keep our economy and standard of living moving forward. One such new product of today is the Transportable Exam Station (TES), which brings the doctor to you. Other such products include Apple’s new head-mounted iPhone, Microsoft’s new tablet called Surface, and Chevrolet’s new electric car called Volt. In addition to understanding the significance to managers and society of managerial work and its related benefits, prospective managers need to know what the management task entails.
The sections that follow introduce the basics of the management task through discussions of the roles and definitions of management, the management process as it pertains to management functions and organizational goal attainment, and the need to manage organizational resources effectively and efficiently. Our society could neither exist as we know it today nor improve without a steady stream of managers to guide its organizations. Peter Drucker emphasized this point when he stated that effective management is probably the main resource of developed countries and the most needed resource of developing ones.4 In short, all societies desperately need good managers. Management is important to society as a whole as well as vital to many individuals who earn their livings as managers.
Government statistics show that management positions have increased from approximately 10 to 18 percent of all jobs since 1950. Managers come from vary- ing backgrounds and have diverse educational specialties. Many people who originally train to be accountants, teachers, financiers, or even writers eventually make their livelihoods as man- agers. Although in the short term, the demand for managers varies somewhat, in the long term, managerial positions can yield high salaries, status, interesting work, personal growth, and feel- ings of accomplishment.
The Associated Press has recently ranked total compensation paid to top managers in the United States. Based on the 2016 ranking, Table 1.1 shows the names of the 10 most highly paid chief executives, the company they worked for, and how much they earned. An inspection of the list of highest-paid executives in Table 1.1 reveals that the overwhelm- ing majority of the top-paid executives are men. Based on the results of a recent survey at the Wall Street Journal, Figure 1.1 illustrates a broad salary gap between men and women.
Whereas women and men make up roughly the same proportion of the workforce, men hold a dispro- portionate number of higher-paying jobs according to the figure. In addition, a notable study by the American Association of University Women indicated that the discrepancy between the pay of men versus the pay of women is a national phenomenon M01_CERT5193_15_GE_C01.indd 33 14/09/18 2:35 PM 34 PART 1 Introduction to Modern Management TABLE 1.1 The 10 Highest-Compensated CEOs, 2016 Ranking CEO Name Company Name Paid ($ millions) 1 Dara Khosrowshahi Expedia 94.6 2 Leslie Moonves CBS 56.4 3 Philippe Dauman Viacom 54.1 4 Leonard Schleifer Regeneron Pharmaceuticals 47.5 5 Robert Iger Walt Disney 43.5 6 Sandeep Mathrani General Growth Properties 39.2 7 Brian Roberts Comcast 36.2 8 Marissa Mayer Yahoo 36 9 David Cote Honeywell International 33.8 10 Marc Benioff Salesforce.4 Source: “Top 10 Highest-Paid CEOs,” The Associated Press, May 25, 2016. and is not isolated to a particular state or region.