Fundamentals of Management, 10th Edition Solution Manual

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TABLE OF CONTENTSPrefaceiCHAPTER 1 .............................................................................................................................................. 1-1HISTORY MODULE......................................................................................................................... HM-18CHAPTER 2 ............................................................................................................................................ 2-22CHAPTER 3 ............................................................................................................................................ 3-36CHAPTER 4 ............................................................................................................................................ 4-56QUANTITATIVE MODULE............................................................................................................ QM-77CHAPTER 5 ............................................................................................................................................ 5-82CHAPTER 6 .......................................................................................................................................... 6-101CHAPTER 7 .......................................................................................................................................... 7-121CAREER MODULE .........................................................................................................................CM-145CHAPTER 8 .......................................................................................................................................... 8-148CHAPTER 9 .......................................................................................................................................... 9-168CHAPTER 10 ...................................................................................................................................... 10-190CHAPTER 11 ...................................................................................................................................... 11-206CHAPTER 12 ...................................................................................................................................... 12-226CHAPTER 13 ...................................................................................................................................... 13-246CHAPTER 14 ...................................................................................................................................... 14-263CHAPTER 15 ...................................................................................................................................... 15-280ENTREPRENEURSHIP MODULE................................................................................................EM-300

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ivSAMPLECOURSESYLLABUSRobbins, Coulter, and DeCenzo’s Fundamentals of Management 10e withMyManagementLabAll Assignments should be completed before class.Suggested Distribution:Exams50%Quizzes20%Writing Space (Essays)20%Simulations5%Participation5%Discussion Questions could be added for online classes.WeekReading AssignmentMyLab Assignment1Chapter 1: Managers and Management&Chapter 2: The Management EnvironmentCritical Thinking Quizzes forChapters 1 and 22Chapter 3: Integrative Managerial IssueCritical Thinking Quiz3Chapter 4: Foundations of DecisionMakingCritical Thinking Quiz4Chapter 5: Foundations of PlanningCritical Thinking QuizWriting Space: MGMT 8 StrategicDecision Making5Chapter 6: Organizational Structure andDesignCritical Thinking Quiz6Chapter 7: Managing Human ResourcesCritical Thinking Quiz7Chapter 8: Managing Change andInnovationCritical Thinking QuizSimulation: Change8Mid-TermExam9Chapter 9: Foundations of IndividualBehaviorCritical Thinking Quiz

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v10Chapter 10: Understanding Groups andManaging Work TeamsCritical Thinking Quiz11Chapter 11: Motivating and RewardingEmployeesCritical Thinking QuizWriting Space: MGMT 14Theories of Motivation12Chapter 12: Leadership and TrustCritical Thinking QuizSimulation: Leadership and/orLeadership Imperative13Chapter 13: Managing Communication andInformationCritical Thinking Quiz14Chapter 14: Foundations of ControlCritical Thinking Quiz15Chapter 15: Operations ManagementCritical Thinking Quiz16Final ExamOTHERMATERIALSAVAILABLE WITHFUNDAMENTALS OFMANAGEMENT,10THEDITIONAt the Instructor Resource Center (IRC), www.pearsonhighered.com/irc, instructors canaccess a variety of print, digital, and PowerPoint presentations available with this text indownloadable format. The process to register for this resource center is simple and givesyou immediate access to new titles and new editions. As a registered faculty member,you can download resource files and receive immediate access to and instructions forinstalling course management content on your campus server. In case you ever needassistance, our dedicated technical support team is ready to help with the mediasupplements that accompany this text. Visit http://247.pearsoned.com for answers tofrequently asked questions and toll-free user support phone numbers.The following supplements are available for download to adopting instructors:Instructor’s ManualTest BankTestGen ® Computerized Test Bank (test-generating program)PowerPoint PresentationsTESTBANK

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viEach chapter of the text has an extensive test bank of multiple-choice, true/false, andshort answer questions to test understanding. The Test Item File is specifically for the10thedition with page references, learning objective references, AACSB referenceswhere appropriate, and difficulty level for each question. The Test Bank is in MS Wordso that instructors can easily incorporate select questions into their own tests.TESTGEN®COMPUTERIZEDTESTBANK(TEST-GENERATING PROGRAM)The test bank is also available in TestGen, a test-generating program that allowsinstructors to efficiently add, edit, or delete questions from the test bank; analyze testresults; and organize a database of exams and student results. Our TestGens areconverted for use in BlackBoard, WebCT, Angel, D2L, and Moodle. All theaforementioned conversions are available on the IRC.POWERPOINTPRESENTATIONSInstructor PowerPoint presentations are available for each chapter and module in the text.Instructor PowerPoints: This presentation includes basic outlines andkey points from each chapter. It includes figures and photos from thetext, and is a good option for instructors looking for a set of slides thatsummarize the topics and examples in the book.VIDEOLIBRARYVideo segments that illustrate the most pertinent topics in management today andhighlight relevant issues that demonstrate how people lead, manage, and workeffectively. Videos illustrating the most important subject topics are available inMyManagementLab.AACSBLEARNING STANDARDSTAGS IN THETESTITEMFILEQuestions that test skills relevant to AACSB standards are noted with the appropriate tag,which may help identify potential applications of these skills for students.MYMANAGEMENTLAB: (www.mymanagementlab.com)Is an easy-to-use online tool that personalizes course content and provides robustassessment and reporting to measure individual and class performance. All of theresources you need for course success are in one place – flexible and easily adapted foryour course experience. Students can purchase access to MyManagementLab with aPearson eText or without a Pearson eText by visiting www.mymanagementlab.com.They can also purchase an access card packaged with the text fromwww.mypearsonstore.com at a reduced price.

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Chapter 1 – Managers and Management1-1CHAPTER 1MANAGERSANDMANAGEMENTLEARNING OUTCOMESAfter reading this chapter, students should be able to:1-1.Tell who managers are and where they work.1-2.Define management.1-3.Describe what managers do.1-4.Explainwhy it’s important to study management.1-5.Describethe factors that are reshaping and redefining management.Management MythMYTH:Only those who want to be managers need to take a course in management.TRUTH:Anyone who works in an organization—not just managers—can gain insight intohow organizations work and the behaviors of their boss and coworkers by taking a course inmanagement.SUMMARYEveryone seems to think they know what makes a good leader. They think it is common sensebut you don’t have to be a manager, or aspire to be a manager, in order to gain something froma management course.Teaching Tips:Get students to give some examples of good managers. Ask if it matters if the manager is youngor old, male or female? Is management necessary in non-profit organizations and smallcompanies like it is in for-profit and large companies?

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Chapter 1 – Managers and Management1-2I.WHO ARE MANAGERS, AND WHERE DO THEY WORK?A.Introduction1.Managers work in an organization.2.An organization is a deliberate arrangement of people brought together to accomplishsome specific purpose.a)Your college or university is an organization. So is a football team and a sorority.B.What Three Characteristics Do All Organizations Share?1.Every organization has a purpose and is made up of people who are grouped in somefashion.a)See Exhibit 1-1.b)This distinct purpose is typically expressed in terms of a goal or set of goals.2.Purposes or goals can only be achieved through people.3.All organizations develop a systematic structure that defines and limits the behaviorof its members.a)Developing a structure may include creating rules and regulations, giving somemembers supervisory control, forming teams, etc.C.How Are Managers Different from Nonmanagerial Employees?1.Organizational members fit into two categories: nonmanagerial employees andmanagers.a)Nonmanagerial employeeswork directly on a job or task and have no oversighton the responsibility of others.b)Managersdirect the activities of other people in the organization.1)Customarily classified as top, middle, or first line, they supervise bothnonmanagerial employees and lower-level managers.2)See Exhibit 1-2.3)Some managers also have nonmanagerial responsibilities themselves.2.The distinction between non-managers and managers is that managers haveemployees who report directly to them.

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Chapter 1 – Managers and Management1-3D.What Titles Do Managers Have?1.Top managersare responsible for making decisions about the direction of theorganization and establishing policies that affect all organizational members.a)Top managers have titles including vice president, managing director, chiefoperating officer, chancellor, etc.2.Middle managersrepresent levels of management between the first-line supervisorand top management.a)They manage other managers and possibly some nonmanagerial employees.b)They are responsible for translating the goals set by top management into specificdetails.3.First-line managers are usually called supervisors, shift managers, etc.a)They are responsible for directing the day-to-day activities of nonmanagerialemployees.4.Team leaders are responsible for managing and facilitating activities of a work team.a)They typically report to a first-line manager.II.WHAT IS MANAGEMENT?1.Management can be defined as the process of getting things done effectively andefficiently, through and with other people.a)The term “process” in the definition represents the primary activities managersperform.2.Effectiveness and efficiency deal with what we are doing and how we are doing it.From the Past to the PresentThe terms management or manager come from a number of sources. One source says that theword manager originated in 1588 to describe one who manages. The specific use of the word as“one who conducts a house of business or public institution” is said to have originated in 1705.Another source says that the origin (1555–1565) is from the word ‘maneggiare’, which meant“to handle or train horses,” and was a derivative of the wordmano, which is from the Latin wordfor hand,manus. This origin arose from the way that horses were guided, controlled, or directedwhere to go—by using one’s hand.The words management and manager are more appropriate to the early twentieth century. PeterDrucker, the late management writer, studied and wrote about management for more than 50years. The word ‘management’ was first popularized by Frederick Winslow Taylor. In 1911,Taylor’s book “Principles of Scientific Management” was published. Its contents were widelyembraced by managers around the world. The book described the theory ofscientificmanagement:the use of scientific methods to define the “one best way” for a job to be done.He spent more than two decades passionately pursuing the “one best way” for such jobs to bedone. Based on his groundbreaking study of manual workers using scientific principles, Taylorbecame known as the “father” of scientific management. Some of these techniques like theanalysis of basic work that must be performed and time-and-motion studies, are still used today.

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Chapter 1 – Managers and Management1-4a)Efficiency means doing the task right and refers to the relationship between inputsand outputs. Management is concerned about minimizing resource costs whileachieving the desired output.b)Effectiveness means doing the right task, and in an organization, that translatesinto goal attainment.c)See Exhibit 1-3.3.Efficiency and effectiveness are interrelated.a)It’s easier to be effective if one ignores efficiency.b)Good management is concerned with both the attainment of goals (effectiveness)and efficiency in the process.III.WHAT DO MANAGERS DO?A.Describing what managers do is a difficult task1.While the job of manager varies from organization to organization, they do sharesome common elements.2.Management researchers have developed three approaches to describe whatmanagers do: functions, roles, and skills/competencies.B.The Four Management Functions1.See Exhibit 1-4; planning, organizing, leading, and controlling.2.These processes are interrelated as well as interdependent.3.Planning encompasses defining an organization’s goals, establishing an overallstrategy for achieving those goals, and developing plans to coordinate activities.4.Organizing—determining what tasks are to be done, who is to do them, how thetasks are grouped, who reports to whom, and where decisions are to be made.5.Directing and coordinating people is the leading component of management.a)Leading involves motivating employees, directing the activities of others,selecting the most effective communication channel, and resolving conflicts.6.Controlling.a)To ensure that things are going as they should, a manager must monitor theorganization’s performance.b)Actual performance must be compared with the previously set goals.c)Any significant deviations must be addressed.d)Monitoring, comparing, and correcting are the controlling process.C.Management Roles Approach1.Fayol’s original applications represented mere observations from his experiences inthe French mining industry.

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Chapter 1 – Managers and Management1-52.In the late 1960s, Henry Mintzberg provided empirical insights into a manager’s job.He undertook a careful study of five chief executives at work.Mintzberg provided a categorization scheme for defining what managers do on thebasis of actual managers on the job—Mintzberg’s managerial roles.Mintzberg concluded that managers perform ten different but highly interrelatedroles.a)These ten roles are shown in Exhibit 1-5.b)They are grouped under three primary headings:1)Interpersonal roles – figurehead, leader, liaison2)Informational roles – spokesperson, disseminator, monitor3)Decisional roles – entrepreneur, disturbance handler, resource allocator,negotiatorD.What Skills and Competencies do Managers Need?1.Robert Katz proposed that managers must possess and use four critical managementskills.a)Conceptual skills– used to analyze and diagnose complex situations.b)Interpersonal skills–involved with working well with other people, bothindividually and in groups.c)Technical skills– job-specific knowledge and techniques needed to performwork tasks.d)Political skills– to build a power base and establish the right connections.E.Is the Manager’s Job Universal?1.Level in the Organization: The importance of managerial roles varies depending onthe manager’s level in the organization.a)The differences in managerial roles are of degree and emphasis, but not ofactivity.b)As managers move up, they do more planning and less direct overseeing ofothers.1)See Exhibit 1-6.c)The amount of time managers give to each activity is not necessarily constant.d)The content of the managerial activities changes with the manager’s level.1)Upper-level managers are concerned with designing the overall organization’sstructure.e)Lower-level managers focus on designing the jobs of individuals and workgroups.2.Profit versus Not-for-Profit.

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Chapter 1 – Managers and Management1-6a)The manager’s job is mostly the same in both profit and not-for-profitorganizations.b)All managers make decisions, set objectives, create workable organizationstructures, hire and motivate employees, secure legitimacy for their organization’sexistence, and develop internal political support in order to implement programs.c)The most important difference is measuring performance, profit, or the “bottomline.”d)There is no such universal measure in not-for-profit organizations.e)Making a profit for the “owners” of not-for-profit organizations is not the primaryfocus.3.Size of Organization.a)Definition of small business and the part it plays in our society.1)There is no commonly agreed-upon definition.b)Small business—any independently owned and operated profit-seeking enterprisethat has fewer than 500 employees.c)The role of managing a small business is different from that of managing a largeone.1)See Exhibit 1-7.2)The small business manager’s most important role is that of spokesperson(outwardly focused).3)In a large organization, the manager’s most important job is deciding whichorganizational units get what available resources (inwardly focused).4)The entrepreneurial role is least important to managers in large firms.5)A small business manager is more likely to be a generalist.6)The large firm’s manager’s job is more structured and formal than themanager in a small firm.7)Planning is less carefully orchestrated in the small business.8)The small business organizational design will be less complex and structured.9)Control in the small business will rely more on direct observation.d)We see differences in degree and emphasis, but not in activities.4.Management Concepts and National borders.a)Studies that have compared managerial practices between countries have notgenerally supported the universality of management concepts.1)In Chapter 3, we will examine some specific differences between countries.b)Most of the concepts we will be discussing primarily apply to the United States,Canada, Great Britain, Australia, and other English-speaking democracies.

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Chapter 1 – Managers and Management1-7c)Concepts may need to be modified when working with India, China, Chile, orother countries where economic, political, social, or cultural environments differgreatly from that of the so-called free-market democracies.IV.WHY STUDY MANAGEMENT?A.Reasons1.We all have a vested interest in improving the way organizations are managed.a)We interact with them every day of our lives.1)Examples of problems that can largely be attributed to poor management.b)Those that are poorly managed often find themselves with a declining customerbase and reduced revenues.2.The reality that once you graduate from college and begin your career, you will eithermanage or be managed.a)An understanding of the management process is the foundation for buildingmanagement skills.b)You will almost certainly work in an organization, be a manager, or work for amanager.c)You needn’t aspire to be a manager in order to gain something valuable from acourse in management.V.WHAT FACTORS ARE RESHAPING AND REDIFINING MANAGEMENT?A.Introductiona)Managers are dealing with changing workplaces, a changing workforce, changingtechnology, and global economic uncertainties.b)Managers everywhere are likely to have to manage in changing circumstances,and the fact is thathowmanagers manage is changing.B.Why Are Customers Important to the Manager’s Job?1.Without customers, the organization wouldn't survive.2.Employee attitudes and behaviors play a big role in customer satisfaction.3.Managers must create a customer responsive organization.C.Why Is Innovation Important to the Manager’s Job?1.Not being innovative in today's world is risky.2.Managers need to understand what, when, where, how, and why innovation can befostered and encouraged throughout the organization.3.Managers not only need to be innovative but they must foster it in others.

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Chapter 1 – Managers and Management1-8A Question of EthicsTwenty-six percent of new managers feel they’re unprepared to transition into managementroles. Fifty-eight percent of new managers don’t receive any training to help them make thetransition. Forty-eight percent of first-time managers fail in that transition.Moving to a management position isn’t easy, as these statistics indicate.If your professor hasassigned this, go to the Assignments section ofmymanagementlab.comto complete thesediscussion questions.Questions for students to consider:Does an organization have an ethical responsibility to assist its new managers in theirnew positions? Why or why not?What could organizations do to make this transition easier?D.Importance of Social Media to the Manager’s Job1.Social media– forms of electronic communication through which users create onlinecommunities to share ideas, information, personal messages, and other content.Technology and the Managers JobIs It Still Managing When What You’re Managing Are Robots?It shouldn’t be surprising that the office of tomorrow will be heavily populated by robots. Whathappens to the manager’s job when this happens? And how will these new (robotic) employeesaffect their human counterparts? From the evidence that exists, it appears that people find it easyto interact with robots as co-workers.Students should think about:Defining managers and management under this type of setting.Conducting research on telepresence and telepresence robots. How might this technologychange the way workers and managers work together?What’s your response to the title of this box:Isit still managing when what you’re managingare robots?If you had to “manage” people and robots, how do you think your job as manager might bedifferent than what the chapter describes?Teaching Tips:Have students think about several recent innovations, i.e. smart phones. How out of place wouldthese technologies have been 20, 50, or 100 years ago? Once we start to use a new technology,how long does it take before the ‘awe’ factor wears off?

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Chapter 1 – Managers and Management1-92.Employees can use social media for work purposes. Several examples are discussedin the text about companies using social media to manage human resource issues andto foster communication and collaboration throughout the company.3.It can also be a problem and managers must be careful that social media does not turnthe organization into a place where people boast, brag, or send one way messages toemployees.E.Importance of Sustainability to the Manager’s job1.Sustainability– company’s ability to achieve its business goals and increase long-term shareholder value by integrating economic, environmental, and socialopportunities into its business strategies.a)This is becoming more important.b)Managers must look at corporate social responsibility not only to manage in anefficient and effective way but also responding strategically to a wide range ofenvironmental and social challenges.F.Wrapping It Up1.Being a manager is both challenging and exciting.2.Gallup polls indicate that the single most important variable in employee productivityand loyalty is the quality of the relationship between employees and their directsupervisors.3.Gallup also found that the relationship with their manager is the largest factor inemployee engagement—which is when employees are connected to, satisfied with,and enthusiastic about their jobs— accounting for at least 70 percent of anemployee’s level of engagement.4.Research also shows that talented managers contribute about 48 percent higher profitto their companies than do average managers. Another study found that when a poormanager was replaced by a talented one, employee productivity increases by 12percent.REVIEW AND APPLICATIONSCHAPTER SUMMARY1-1Tell who managers are and where they work.Managers are individuals who workin an organization directing and overseeing the activities of other people. Managersare usually classified as top, middle, or first-line. Organizations, which are wheremanagers work, have three characteristics: goals, people, and a deliberate structure.1.1-2Define management.Management is the process of getting things done, effectivelyand efficiently, with and through other people. Efficiency means doing a taskcorrectly (“doing things right”) and getting the most output from the least amount ofinputs. Effectiveness means “doing the right things” by doing those work tasks thathelp the organization reach its goals.1-3Describe what managers do.What managers do can be described using threeapproaches: functions, roles, and skills/competencies. The functions approach says

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Chapter 1 – Managers and Management1-10that managers perform four functions: planning, organizing, leading, and controlling.Mintzberg’s roles approach says that what managers do is based on the 10 roles theyuse at work, which are grouped around interpersonal relationships, the transfer ofinformation, and decision making. The skills/competencies approach looks at whatmanagers do in terms of the skills and competencies they need and use. Four criticalmanagement skills are conceptual, interpersonal, technical, and political. Additionalmanagerial competencies include aspects such as dependability, personal orientation,emotional control, communication, and so forth. All managers plan, organize, lead,and control, although how they do these activities and how often they do them mayvary according to level in the organization, whether the organization operates forprofit or not-for-profit, the size of the organization, and the geographic location of theorganization.1-4Explain why it’s important to study management.One reason it’s important tostudy management is that all of us interact with organizations daily so we have avested interest in seeing that organizations are well managed. Another reason is thatin your career, the reality is that you will either manage or be managed. By studyingmanagement, you can gain insights into the way your boss and fellow employeesbehave and how organizations function.1-5Describe the factors that are reshaping and redefining management.In today’sworld, managers are dealing with changing workplaces, a changing workforce, globaleconomic and political uncertainties, and changing technology. Four areas of criticalimportance to managers are delivering high-quality customer service, encouraginginnovative efforts, using social media efficiently and effectively, and recognizing howsustainability contributes to an organization’s effectiveness.DISCUSSION QUESTIONS1-1What is an organization and what characteristics do organizations share?Answer:An organization is a systematic arrangement of people brought together toaccomplish some specific purpose. All organizations share three common characteristics: 1)Every organization has a purpose and is made up of people who are grouped in some fashion;2) No purpose or goal can be achieved by itself, therefore organizations have members; 3)All organizations develop a systematic structure that defines and limits the behavior of itsmembers.1-2How do managers differ from nonmanagerial employees?Answer:Nonmanagerial employees are people who work directly on a job or task and haveno responsibility for overseeing the work of others. Nonmanagerial employees may bereferred to by names such as associates, team members, contributors, or even employeepartners. Managers, on the other hand, are individuals in an organization who direct andoversee the activities of other people in the organization. This distinction doesn’t mean,however, that managers don’t ever work directly on tasks. Some managers do have workduties not directly related to overseeing the activities of others.1-3In today’s environment, which is more important to organizations—efficiency oreffectiveness? Explain your choice.

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Chapter 1 – Managers and Management1-11Answer:Management is the process of getting things done, effectively and efficiently,through and with other people. Effectiveness and efficiency deal with what we are doing andhow we are doing it. Efficiency means doing the task right and refers to the relationshipbetween inputs and outputs. Effectiveness means doing the right task, which translates intogoal attainment. Efficiency and effectiveness are interrelated.It’s easier to be effective if one ignores efficiency. Good management is attaining goals(effectiveness) and doing so as efficiently as possible. Organizations can be efficient and yetnot effective. High efficiency is associated more typically with high effectiveness. Poormanagement is most often due to both inefficiency and ineffectiveness or to effectivenessachieved through inefficiency.To address the question of which is more important, it depends. Doing the right tasks maykeep a business in business—keep the doors open and meet payroll. Doing the wrong tasksmay close the doors and send everyone home.Suppose you are the owner and manager of a CPA firm. Over the years, your organizationhas developed a long-term relationship with a number of customers who come to you eachyear to prepare their income tax return.If you chose to emphasize efficiency over effectiveness, what might happen? You mightcreate an infrastructure that, at least in the short-run, would be very efficient. Suppose youhave one person handle a customer’s tax return preparation from start to finish (sounds like asilo). You could have your accountants specialize in the type of customers they work with sothey could become even more efficient in completing the tax returns (we’ll talk about jobspecialization more in the history module and chapter five). You could create a compensationsystem where accountants who could document their ability to complete tax returns in lesstime were rewarded. Let’s come back to this concept in a minute.What if you chose to emphasize effectiveness over efficiency? Suppose that it is one of yourorganization’s goals to guarantee accurate preparation of income tax returns. You may decideto send all employees to training to learn the most up-to-date advice available regarding taxlaw. You may also see that all of your employees have training each year in any changesbeing implemented by the Internal Revenue Service. You might also create an infrastructurethat would seem to be less efficient. For example, you might require that each tax return bereviewed by three separate accountants, one of whom must be a senior accountant, before itis released to the customer. You may require all accountants to work with a wide variety oftax returns so they will develop a broader base of expertise.In the first example (the efficient office), everything might move quickly from start to finishbut your control system may be weak. When customers begin to be audited by the IRS andlearn that your efficient operation was not necessarily effective (tax returns are not correctaccording to tax law and IRS requirements), your customer base may quickly disappear andyour ability to continue in business could be at risk.In the second example (the effective office), everything and everyone may be veryknowledgeable, thorough, correct, and expensive. When your customers begin to figure outthat your charges are higher than those paid by some of their friends for similar services,your customer base may quickly disappear and your ability to continue in business could beat risk.

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