Chapter 2 The Organizational Context of the New Millennium

1. Chapter 2The Organizational Context of the New Millennium Diversity, Quality,Technology, International

2. Learning Goals • Understand why the U.S. Workforce will increase in diversity well into the next century • Describe the direction in which many organizations are headed in managing for quality

3. Learning Goals (Cont.) • Explain how technological changes will affect modern organizations and their management • Discuss some issues and implications of managing organizations in an increasingly global environment

4. Chapter Overview • Workforce Diversity • Quality Management • Technology, Organizations, and Management • The Global Environment of Organizations

5. Introduction Workforcediversity Quality Management Emergingissues Technology,Organizations,and Management Globalenvironment

6. Workforce Diversity • Differences in workforce composition based on personal and background factors of people • Some dimensions of workforce diversity • Age • Race • Physical ability • Family status See text book Figure 2.1 for a more complete listing

7. Workforce Diversity (Cont.) • Projections show more women, more minorities, and older workers in the work force • Expect strong regional differences • For example, California's population in 2005 will have 50 percent white and 50 percent people of color, speaking 80 languages

8. Workforce Diversity (Cont.) • Differences in people also present different worldviews to an organization • They see the world through different perceptual lenses • Issue: harnessing these differences as opportunities to pursue the organization’s mission

9. Workforce Diversity (Cont.) • Challenges to personnel and work policies • Working parents: work schedules and on-site day care • Single parent: time off to tend to sick child • Native Americans: work schedules and their culture’s celebration periods • Disabled: special access to building and work area design • Part-time: job sharing

10. Workforce Diversity (Cont.) Three views Valuing Managing Workforce diversity Managing for

11. Workforce Diversity (Cont.) • Valuing diversity • Aggressively embrace diversity • Goes beyond managing existing diversity • Recognizes the essential character of a diverse workforce • Actively builds a diverse workforce

12. Workforce Diversity (Cont.) • Managing diversity • Harness the potential of all sources of difference within an organization's workforce • Tap diverse perspectives and rethink approaches to tasks and markets • Example: after hiring its first Hispanic female attorney, a small northeastern law firm discovered a new market: pursue English-only employment policies in cases involving immigrants. Previously all-white legal staff never thought of that market

13. Workforce Diversity (Cont.) • Managing diversity (cont.) • Not affirmative action in disguise • Get the greatest contributions from increasingly diverse people • A variety of views enriches organizational life • Does not ask people to give up their individuality

14. Workforce Diversity (Cont.) • Managing diversity (cont.) • Honors differences among people, but asks everyone to accept the core values of the organization • Core values come from organization's mission: "An unending pursuit of excellence in customer service.” • People reach the goal in many different ways because of their diversity

15. Workforce Diversity (Cont.) • Managing diversity (cont.) • No choice about managing for diversity • Note the labor force statistics discussed earlier • Likely have a diverse labor force in the future, especially as an organization pursues scarce skilled labor • Organizations that have followed affirmative action and Equal Employment Opportunity (EEO) guidelines now have diverse workforces

16. Workforce Diversity (Cont.) • Managing diversity (cont.) • Good business strategy • Increasingly diverse customer base • Think and compete globally to remain competitive • A diverse workforce helps managers attract customers from diverse backgrounds • Example: Pizza Hut has found that the presence of Muslim workers attracts more Muslim customers

17. Workforce Diversity (Cont.) • Managing diversity (cont.) • Global environment adds another layer of complexity • Many U.S. organizations sell in foreign markets, operate in foreign countries, or have joint ventures with foreign organizations • Need to understand local customs to meet customer expectations in foreign markets • Diverse workforce helps U.S. organizations meet these global challenges

18. Workforce Diversity (Cont.) • Managing for diversity • Aggressively recruit and hire people of diverse backgrounds • Challenges • Unleash the potential of a diverse workforce • Channel it toward organizational goals • Provide vision so everyone understands the goals • Preserve a diversity of viewpoints • Help employees get the satisfaction they want from their work experiences

19. Workforce Diversity (Cont.) • Managing for diversity (cont.) • Policy changes • Work schedules • Personal leave • Language training in English or other languages • Other basic skills • Fairness in policies: day-care policy applies to all employees

20. Workforce Diversity (Cont.) • Managing for diversity (cont.) • Managers will need to learn new skills • Accepting differences • Appreciating language differences • Learning new languages. Includes sign language to communicate with hearing-impaired employees

21. Workforce Diversity (Cont.) • Managing for diversity (cont.) • Other changes touch the heart of an organization's culture • Values suitable to a homogeneous white-male culture need to yield to the heterogeneous values of diverse groups • Social activities • Rituals in male cultures will need to change to allow ready access by females • Rotate activities to meet the desires of both groups • Example: if social gatherings include only male-oriented sports, add other activities

22. Quality Management • Managing all parts of an organization to ensure quality products or services • Can trace its roots to the 1920s • Ignored by American managers until forced to focus on it by competitive forces • Many names: Total Quality Control, Leadership through Quality, Total Quality Management, Robust Design, six-sigma quality • Quality Management (QM) covers them all

23. Quality Management (Cont.) • Quality Management • A philosophy and system of management • Philosophy: values of quality, continuous improvement, and “getting it right the first time” • System of management: tools and techniques that help manage for quality and continuous improvement • Has its roots in manufacturing but applies to all organizations

24. Quality Management (Cont.) • History • An American invention, not Japanese • Some significant contributors: W. Edwards Deming, Walter A. Shewhart, Armand V. Feigenbaum, Joseph M. Juran, and Philip B. Crosby • Taught to the Japanese after WW II. They understood what it meant from the beginning

25. Quality Management (Cont.) • Requires a total system's view of the organization. Reaches beyond its boundaries • Interdependence of outside people, outside organizations, and groups within the organization to manage for quality • Employees • Suppliers • Clients, customers

26. Quality Management (Cont.) • Interdependence (cont.) • Community • Coalitions to which the organization belongs • Professional or trade associations • Competitors

27. Quality Management (Cont.) • View organizations as a system of processes, not as a vertical chain-of-command view • Emphasizes processes, customers, interdependence with suppliers, and the role of feedback in continuous quality improvement • Ask customers and suppliers: discover shifts in expectations and quality requirements

28. Quality Management (Cont.) • Supporting tools and techniques • Let people watch work processes to ensure a quality product or service • Train employees in the use of the tools • Most QM tools and techniques let organizations analyze processes

29. Quality Management (Cont.) • Supporting tools and techniques (cont.) • Typically done by teams of people drawn from all parts of the organization affected by the process • Deliberately diverse teams bring different views to the analysis and improvement of a work process • Example: analysis team examining an organization's hiring process includes members from the Human Resources Department, hiring departments, newly hired employees, labor union representatives

30. Quality Management (Cont.) • Benefits • Increased employee commitment to continuous quality improvement • Cost of providing a service or manufacturing a product drops • More dependable service processes. More reliable products

31. Quality Management (Cont.) • QM differs from other ways of managing • Emphasizes a long-term commitment to continuous quality improvement • Quality is everyone's job, not the job of a quality-control department • Intensely customer focused: demands that all organization members share that focus • Emphasizes high involvement in the work process

32. Quality Management (Cont.) • QM differs from other ways of managing (cont.) • Communication in all directions--top-down, bottom-up, laterally • A long-term orientation: commitment to the future • Decisions made with a view of the future • Continuous improvement lets people do more with the same resources

33. Quality Management (Cont.) • QM differs from other ways of managing (cont.) • Involving everyone in continuous improvement can add challenge to employees' jobs • Long-run result: a committed corps of people with an impassioned focus on mission, customers, and continuous quality improvement

34. Quality Management (Cont.) • Moving toward QM presents massive change to an organization • Requires people to reframe the way they think about their organization • Difficult transformations might account for some QM failures

35. Quality Management (Cont.) • Results • Continuous improvement increases process efficiency and reduces costs • Quality can attract new customers and increase the retention of old ones. Costs five times more to get new customers than to keep present ones • High quality can make a product or service so attractive that an organization can charge higher prices than competitors

36. Quality Management (Cont.) • Results (cont.) • QM efforts produced poor results when managers did not target improvements to areas that had the greatest long-term positive effect on profits • Some significant positive financial effects • Some major failures: The Wallace Co. and Florida Power and Light

37. Technology, Organizations,and Management • Computing power and computer features • Desktop computers with CD-Rom drives, high-speed processors, and large memory capacity: create business presentations using three-dimensional animated technology • Laptop and palmtop computers: Internet connections using ports in airport telephones, aircraft telephones, or cybercafés • Tracking appointments and staying connected will continue to get easier in the future

38. Technology, Organizations,and Management (Cont.) • Communications technology • Note: the first transatlantic telephone cable carried only 89 simultaneous calls! • Digital satellite systems: allows handheld digital cellular communication anywhere in the world

39. Technology, Organizations,and Management (Cont.) • Communications technology (cont.) • Lucent Technology's Bell Labs' wave division multiplexing • Splits a single beam of light into multiple colors • Each color is a separate communication channel within an optical fiber • Handheld communicators: send and receivee-mail, talk to a person by telephone, and surf the Web--from anywhere

40. Technology, Organizations,and Management (Cont.) • Other technologies • Electronically based measurement systems: monitor manufacturing processes and collect sales data at store checkout stands • Future computer technologies: digitize information from voice interaction and handwriting on a digital tablet • Handheld computers: track inventories and send orders electronically

41. Technology, Organizations,and Management (Cont.) • Other technologies (cont.) • Navigation satellites: track truck and ship fleets • Communication satellites: managers can talk to drivers and ship captains anywhere in the world • E-mail, voice mail, videoconferencing, teleconferencing • Widely used now and will increase in use in the future

42. Technology, Organizations,and Management (Cont.) • Other technologies (cont.) • Videoconferencing adds a two-way video connection to the now common teleconference • Replace or supplement e-mail systems with voice-mail systems. Oral messages, not written ones, appear in a person's electronic mailbox • Widespread use of intranets (internal networks) and the Internet

43. Technology, Organizations,and Management (Cont.) • Materials technology and engineering • Commonly used: carbon fiber composites and optical fibers • New: superpolymers, amorphous metal alloys, and superconductors • Innovations in product ideas and technological solutions no longer will depend on naturally existing materials

44. Technology, Organizations,and Management (Cont.) • Materials technology and engineering (cont.) • New materials: lighter cars and trucks that can carry heavier loads • New ceramics technology allows designing jet engines with more thrust. Larger planes going longer distances with more people and cargo

45. Technology, Organizations,and Management (Cont.) • Manufacturing • Agile manufacturing processes with almost no inventory. Direct computer links with customers or end-users • Cost-effective and competitive processes to produce both custom-made items and large production runs in the same plant • Products moving through these processes can differ from item to item

46. Technology, Organizations,and Management (Cont.) • Manufacturing (cont.) • Computer-assisted manufacturing (CAM) • Computer-integrated manufacturing (CIM) • Modern materials • Robotics

47. Technology, Organizations,and Management (Cont.) • Manufacturing (cont.) • Laser cutting • Bonding methods • Internet technology: suppliers receive orders as manufacturer updates its manufacturing schedule in real time

48. Technology, Organizations,and Management (Cont.) • Managerial role changes • People in scattered places • Networks will act as coordinating mechanisms, replacing face-to-face interaction • Increase in telecommuting

49. Technology, Organizations,and Management (Cont.) • New strategies • Flexibility: key feature that will permeate the design and response of manufacturing and service operations • Includes thorough understanding of customer needs and variations among markets • Latter will be especially true for multinationals

50. Technology, Organizations,and Management (Cont.) • New strategies (cont.) • Markets in different countries have high diversity even between nearby countries • Treat customers of different countries in the way they expect. Example: insurance giant AIG • Local agents collect monthly premiums at each insured's home in Taiwan • Electronic bank transfers in Hong Kong