Managing People in Organizations Assignment 2011

Master of Business Administration International Programme Managing People in Organizations ASSIGNMENT OCTOBER 2010 – SEPTEMBER 2011 Prepared by Karim Saied Ibrahim Mahmoud El Sisi Submitted on 22 of August 2011* nd * The delay in receiving of the books to mid of July, 2011 was a primary factor 1 I. Table of Contents # I II IV VIII IX X XI XII XIII XIV XV XVI XVII XVIII XIX Contents Table of Contents Table of Figures Introduction What is management?

Importance of Management Functions of Management Management Styles Business Case: Lilly Choice Methods of Investigation The Choice Game Plan Situational Leadership Practice Conclusion and Remarks Appendix I: Interviews References Pg.

No. 2 3 4 4 4 6 8 11 11 12 13 19 21 23 26 2 II. # 1 2 3 4 5 6 7 8 9 10 11 12 13 Table of Figures Pg. No. 11 11 12 13 13 14 14 15 16 17 18 18 18

Figure Eli Lilly Logo Lilly Saudi Hierarchy The Needs Model Game Plan Diagnose your competency Developmental Phase Questionnaire Developmental Phase Questionnaire Developmental Phases Curve Leadership Styles Leadership Styles Assigned to Different Developmental Phases Types of Power (Points of Power) Questions to adjust SMART Goals and Developmental Phases One on One conversation sheet 3 Introduction The success of any organization is depending on a lot of factors, but the most important factor is the management.

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Management is like the maestro of the musical band.

Can you imagine band without maestro, like company without management. So in recent decades, all the organizations start to recognize the importance of management. So there are a lot of books and studies investigate the importing of management and the type of management. What is the management According to According to Harold Koontz, “Management is an art of getting things done through and with the people in formally organized groups.

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It is an art of creating an environment in which people can perform and individuals and can co-operate towards attainment of group goals”.

Management is a very common term, it is not related to business or organization only, but it is related to all aspects of our life like political, culture, and social. The role of management is to organize, and direct all activities and effort towards the objectives and goals of the organization. Importance of management 1. It helps in achieving group goals: ? There are a lot of departments and factors in any organization that contribute in the production process, but all these factors works individual, like employee effort, resource of the organization, financial department, and equipments.

The main role of the management is to set a frame for all those factors to integrate them in one process. This process leads in the end to the main objective of the organization. 2. Optimum utilization of resources: ? Good management provides best use of all organization resources human, raw material, or equipments. There are different methods can be conducted to use the scare resource, and all these methods 4 result in different output. Good management knows how to utilize these resources and which method to use to achieve optimum utilization of resources. . Reduce cost: ? By applying good management the organization can gets maximum output by minimum input. Also good management helps to provide best use of all resource of the organization, which will result in reduction of the total cost. 4. Establishes sound organization: ? Develop and set clear career structure that shows duties and obligations of each individual toward the organization. That will help in conducting the business smooth and set authority & responsibility relationship. 5. Establishes equilibrium: ?

Business in always dynamic not stagnant and everyday there is something new. So to cope with these changes, organization has to have flexible management that can makes changes and adopt easily and quickly. So one of the objectives of management is to work against external and internal environments. If the management can’t adopt easily and quickly, it will lose customers’ and market share because there will be a gap between customers’ needs and what the organization provide. 6. Essentials for prosperity of society: ?

Organizations play a pivotal role towards the community. By helping to improves the standard of living of the individual, create new job opportunity, increases salaries, improve health care, and education, training of their employees. All these aspects will reflect positive on the society. Also good management can determine actual needs of the customers, and also create new products which will increase the welfare of people. 5 After demonstrate the importance of management to each and every organization.

Good management will not reflect only on the owners of organizations but it will reflect on all aspects of life starting from employees to customers and society. So to define good management we should know what the main functions of management are. Functions of management 1. Planning: The main function of good management is to set plan for the current period and for the future of the organization. This plan should be matched with the goals and objectives of organization today and tomorrow. “Planning is deciding in advance – what to do, when to do & how to do. It bridges the gap from where we are & where we want to be” KOONTZ.

Planning is the most important function of management, because all actions of the management depend on the planning. If the plan was matching with the objectives and goals of organization and matched with internal and external factors, it will result in achieving objectives. Also it helps in best use, and utilization of organization resources. Planning process is consist of a lot of steps starting from analysis to the current situation, identify strengths and weaknesses of the organization, determine the objective, and finally applying strategies and set of action plan. 2.

Organizing: It is the function of binding all organizations activities together, financial, physical, and human resources, then organize it in a way that help to the organization to achieve its’ objectives. According to Henry Fayol, “To organize a business is to provide it with everything useful or its functioning i. e. raw material, tools, capital and personnel’s”. 3. Staffing: After planning and organizing, the third step is put the right person in the right place. That is not an easy task, because sometimes organizations has a talents employees with high qualifications, but unfortunately they recruit them in wrong position.

So the good management should have qualified HR department to conduct the recruitment process. . According to Kootz & O’Donell, “Managerial function of staffing involves manning the organization structure through proper and effective selection; appraisal & development of 6 personnel to fill the roles designed un the structure”. Staffing involves several activities starting from recruitment process “selection, interview…”. Also it involves development, training, promotion, performance appraisal, and termination process. 4.

Directing: Directing is the art of management. There are a lot of methods to implement the plan of the management. Good leaders know how to direct sub-ordinate or employee to get the maximum from them, and achieve the goals and objectives of the organization. ? So there are a lot of directions methods:A- Supervision: It is commonly used, and applied by supervisors to subordinates. It is just watch and direct work and workers. B- Motivation: By developing system of awards to employee to motivate them to work more and more to increase the productivity.

Also motivation is not financially only it may be emotionally which is more important. C- Leadership: It is the best way to conduct the business. Leaders guide and affect the work of employee. Good management always tries to keep all managers as leaders. D- Communication: All data, experience, and options should be communicate smoothly through the organization. It provides transparency between all the employees and help to improve performance of individual. 5. Controlling: After planning, organizing, staffing, and direction there must be measurements to evaluate the success of the plan.

So measurements give indications about the success or failure of the plan. Also it helps to determine where the problem is or what is needed to improve the performance of the organization. According to Theo Haimann, “Controlling is the process of checking whether or not proper progress is being made towards the objectives and goals and acting if necessary, to correct any deviation”. So the controlling process has steps: AB7 Setting of standard or desired performance. Assess the actual performance of the organization.

CMeasure the differences between standard and actual performance. DAppling action plan After define the management, it importance, and the main functions of good management. Now we need to demonstrate the different styles of management. Management styles: 1. Democratic management style:This style means that the authority not to the managers only. Employees have the right to participate in the process of the decision making. Also they have the right to conduct the business by their own view or methods. The managers tell them what to do not how to do.

This style has advantages and disadvantages Advantages:A- Motivation of workers or sub-ordinates to work because they do what they think it is right. B- Employee feels that they are part of the whole organization as they have the right to participate or make decisions. C- It gives a lot of chances to talented employees to prove that they should be promoted to the next step. D- Some decisions need specialist skills which may be present in workers not in managers. Disadvantages:A- Democratic management style needs mature and well skilled workers. Workers have the ability to take the responsibility.

So if the workers not skilled enough that will reflect negative on the decision process, and all business aspects. 8 B- Decision will take long time to finalized as there are a lot of members participate in the process 2. Autocratic management style:It is opposite to the democratic one. In these style managers conducts all the process of making decision by them self without delegations of the outhourty to the workers or sub-ordinate. Managers just give order about what to do and how to do without any participation of the workers in the methods or the ways of conducting the business.

It has a lot of advantages and disadvantages Advantages:A- Decision don’t take long time as only senior managements are contributing in the decision making process. B- This type of management is always applicable and effective with employees with low skills and not high qualification Disadvantages:A- Workers feel that they are separated from the organization as they don’t contribute or participate in decision process, and that makes them demotivated. B- This style of management make gab between workers and managers because it is creates “them and us” attitude. 3.

Consultative management style:This style is a mix between democratic and autocratic management style. In this style managers consult workers about decision before making it. So workers are involved in decision process but not deeply as democratic one. This style has advantages and disadvantages 9 Advantages:A- Motivation to the employees ,because they will feel that there is two way communication, and they have the right to accept or reject the decision B- Employees feel that their social needs are being met Disadvantages:A- Sometimes consultation of workers slow down the process of ecision making B- Some employees feel that these style more or less the same of autocratic style, because the final decision is for managers not workers. 4. Laissez faire management style:Managers in this style assign the tasks to the workers and don’t interfere or involved in the decision making process, or how the task is conducted. Managers just give little attention to workers or guide them if the workers ask for guides. This style also has advantages and disadvantages. Advantages:A- Employee get maximum delegation in some tasks B- Managers feel free to conduct other tasks as they have time to do it.

C- Good experience to workers to work as managers not as subordinate because they have all the delegation to conduct the business as they see and think. Disadvantages:ASome time the decision is not matched with company objectives and strategy. BDecision takes long time to be finalized. 10 Lilly Choice: Management or Leadership Methods of Investigation Type of Organization: Pharmaceutical Sales Sources of Information: ? My personal experience as I’m ex-Lilly. ? Situational Leadership Basic Training Documents. ? 2 Interviews with Lilly employees where one of them is a manager and the other is a subordinate.

Backgorund E li Lilly and Company was founded by Eli Lilly in 1876, and it is now the 10th largest pharmaceutical company in the world. It has steadfastly remained independent, but not isolated. Across the globe, Lilly has developed productive alliances and partnerships that advance our capacity to develop innovative medicines at lower costs. Lilly is consistently ranked as one of the best companies in the world to work for, Fig. 1: Lilly Logo and generations of Lilly employees have sustained a culture that values excellence, integrity, and respect for People. This analysis focuses on the mpact of selecting certain management style on the effectiveness of business in the Saudi Affiliate. Managing Director Six Sigma Black Belt Medical Director Financial Manager Ass. Sales Director Marketing Director Ass. Sales Director HR and Complince Manager Department of 5 Department of 4 6 Teams with more than 45 Salesman Department of 4 5 Teams with more than 40 Salesman Department of 4 Fig. 2: Lilly Saudi Hierarchy 11 Saudi Affiliate of Eli Lilly and Company is a sales focus affiliate dedicated to promote and sell different Lilly products in Saudi Arabia.

This affiliate’s revenue is about $ 50 Million and with headcount of more than100 employees, more than 75% of them working in the sales department. Fig. 2 The Choice Actually Lilly had to make a decision and focus on how they shall conduct their business; right now I am talking about the experience I had this company Sales Department in one of Lilly Export Affiliates in the Middle East. As per Lilly website for employees “We continue to increase our leaders’ accountability to develop diverse talent. Our senior leaders must meet diversity work force performance objectives.

These performance objectives focus on mentoring and career path planning for women and diverse employees both in our global work force and in the United States. And in 2006, we began requiring diversity training for all U. S. employees, with additional instruction for supervisors. ” Lilly chose to implement “Situational Leadership” SL as their standard leadership trait during day to day business conduct. Their SL is based on the “Needs Model” which is an objective focused approach takes in consideration the level of competency and commitment of the employee in relevance to Fig. 3: The Needs Model certain objective.

Fig. 3 The employee should identify that through a process called “Game Plan” Fig. 4 12 Game Plan This process defined as the employee guide to get the direction and support they may need from their managers, teammates or colleagues to deal with certain goal, task, skill, or objective. Step I: To identify the key responsibility areas (KRAs) of the employees, prioritize and plan them in a way they can be executed. Step II: To reform employee KRAs into “SMART” Specific, Motivating, Attainable, Relevant and Time-bound objectives; these smart objectives should be measurable as a basic need.

Fig. 4: Game Plan Step III: To diagnose the employee developmental level in relevance to this certain objective. This part of process should be done on 2 axes: Competency Level and Commitment Level. Competency part takes care of the experience, skills and knowledge needed to accomplish this goal. Commitment part is more related to the level of enthusiasm, self-confidence, and psychological status of this employee in relevance to this goal; i. e. does he believe he can accomplish it? To do that, the employee should answer some questions Fig. 6,7 Fig. 5: Diagnose Your Competency 3 Fig. 7: Developmental Phase Questionnaire Fig. 6: Developmental Phase Questionnaire Step IV-A: Also the employees should score themselves accordingly to rightfully know where they stand and which management style they really needs. Please notice that this process of Leadership is not up-to-down process; instead of that the process originates from the employees themselves, therefore it needs more skilful and well-trained workers. Step IV-B: According to their scores the employee should be allocated in one of the following developmental phases: D1, D2, D3 and D4. (Fig. ) Each of these developmental phases needs special leadership style to deal with it successfully. These Leadership styles are S1, S2, S3 and S4. (Fig. 9) S1 for D1: D1 means that the employee is enthusiastic about the objective but unfortunately s/he has not the expertise to deal with it. This Developmental phase usually requires Leadership style S1 where the directing style is the predominant and very minimal autonomy for the employee is provided. Also employee doesn’t need a lot of support. 14 Competency Commitment Fig. 8: Developmental Phases 15 High Support Low Support Fig. : Leadership Styles 16 S2 for D2 Employee usually in D2 needs very special care, as this phase is the most critical developmental phase where the employee has no expertise and s/he identified that in this situation he will not be able to accomplish his target. For that s/he needs Leadership Style S2, where the Leader is more focusing on the motivational part of the situation, with continuous directions to make sure that the employee is doing the right things. S3 for D3 Employee usually in D3 starts to master the skills and knowledge needed to achieve his/her assigned objective.

However, s/he is not quite sure s/he can do it, especially if s/he passed through multiple failures during D2 or stayed a lot trying with no tangible results. This employee will require more psychological support rather than technical one. S3 will be the appropriate way to manage his/her results and expectation where the leader re-enforce the concept of achievement to motivate his/her followers. Directive attitude should be minimized to increase the self-confidence of the employee. S4 for D4 Employee in D4 is a mature employee.

S/he knows what the company and leader need from his/her side. The autonomy is in the top level. Therefore the leader is delegating S4to this employee some of his tasks and gives him/her the freedom to do what they think it will help them to achieve their goals Step V-A: The employee should start to identify which types of Power s/he needs to accomplish the assigned goals. S/he should seek the help of her/his manager to empower the employee in these aspects. Fig. 11 17 Fig. 10: Leadership Styles Assigned to Different Developmental Phases

Step V-B: The employee should set down with the manager to conduct a “One on One” conversation and write down different goals and tasks categorized with different developmental phases on One on One Sheet. This sheet will help in prioritizing different tasks. Fig. 13 Step VI: Employees should frequently adjust their goals and tasks. Also they should revise their developmental phases through asking themselves some questions Fig. 12. These questions are only a framework for such recommended revisions. Fig. 11: Types of Power (Points of Power) Fig. 12: Questions to adjust SMART Goals and Developmental Phases

Fig. 13: One on One Conversation Sheet 18 Situational Leadership in Practice We interviewed some of Lilly’s employees to see how this process is applicable and how far it is effective in the daily practice. Lilly’s middle level manager, who typically leads a team of 6 employees. These employees have different level of experiences and come from different backgrounds. Every one of them has his own areas of excellence and development. Also they are responsible for different tasks. Taking in consideration that managing people is not the only responsibility as a District Sales Manager “DSM” Mr.

Kishta resembles one of these overwhelmed managers; he said that among all of these things “I have to be close enough to give my support to my reporters without being too close; if it happens it will fire back at the team and I will be considered as a “Micro-Manager” rather than a Leader of winners’ team” Also he believes that implementing standard management process like SL isn’t easy, saying “a lot of dynamics are there; however, Lilly established a framework which all employees can use it to define the relation between managers and subordinates” .

Kishta also believes that SL gives him more flexibility rather than ambiguity in dealing with different persons; he said “I prefer to think about it as an opportunity for flexibility. I’m dealing everyday with different 6 personalities -even there are distal person who I communicate with them by different means- everyone has different level of expertise and different set of needs to be fulfilled. I can’t deal with all of them all the time with the same style”.

When we asked him if he considers SL is a shared responsibility he answered “Of course, if we couldn’t conduct good communication between the team; the Situational Leadership approach will fail to meet the expectations” It seems that Kishta is happy with the results SL accomplishes. 19 But as we had to check the opinion of the other side in this process we interviewed Mr. Sherif Zaki, who is an experienced salesman and one of Kishta’s subordinates. Mr. Zaki believes that the process isn’t the best way to help him doing business.

He thinks also because he is one of the most experienced guys in the teams, his manager delegate him to do things, sometimes he is not fully empowered to do them; saying “the problem is that sometimes I feel empowered to do things that I do in good way; but other times as I’m a senior I used to be delegated to do things that I have no experience about them or maybe I don’t have the motivation to do them” Mr. Zaki claims that “due to complexity of the process sometimes we go with the simple management styles”. That is suggesting that many business needs are not fulfilled by this process.

Nevertheless, Mr. Zaki believes in some positives in SL, he said “It makes leaders; this is the most important thing. Another thing this process considers personal variations and looks for level of motivation I have towards certain objective” We can conclude from what is above that, Lilly’s Situational Leadership Process isn’t the perfect way of management, nevertheless, it has many advantages. Development of new management and leadership trends is mandatory as suggested by the people practicing it. 20 Conclusion and Remarks

As we can conclude from the above case, Hersey and Blanchard’s (1977, 1982) approach “Situational Leadership” which they developed from the contingency approach; seems to be difficult to implement. While it treats different situations in different ways, taking into consideration the level of maturity of the employee, which seems to be very reasonable; however, it over-simplify the “Maturity Factor” (Beech, 2009). Maturity is full of ambiguity, Should we consider the more experience is more maturity? Should we consider more motivation is more maturity? Should we consider more enthusiasm is less maturity?

A lot of questions should be answered to define maturity. Also we can see that any lack of transparency and dishonesty can abandon the whole process. Moreover, trust between the leader and subordinate is mandatory of this way of leadership; absence of this factor will slow the whole process leaving it as ineffective way. No doubt management and Leadership are arts and skills rather than mechanical implantation of knowledge. I believe that main challenge is to try to minimize the variation and trying to standardize the outputs through different approaches like: 1.

Unifying selection criteria during the recruitment process ? That is for sure will decrease the burden on manager and gives him better opportunity to be close to his/her subordinates 2. Increase the awareness of managers about the importance of the motivation status of the employees ? Many believe that more inspiration and intellectual convincing might make a lot of differences in how the management process is efficient. 3. To Consider that today Subordinates are tomorrow Leaders and for that more communication transparency is a mandatory need 21 4. To stop categorizing employees in rigid developmental phases.

I think that more flexibility should be offered to such classifications to be able to deal with different business situations, employees might face in their practice. 22 Appendix I Interviews Interview with Mr. Ahmed Kishta Who? ? ? ? ? ? District Sales Manager DSM in Eli Lilly Saudi. He was promoted since 2 yrs from a sales representative. He had worked as a sales representative since 2002 He has 6 reporters coming from different cultures and backgrounds. Some of these reporters are experienced and most of them are new to the job. Q: What are the main responsibility areas in your job?

A: Actually, as a DSM I’m doing many roles. However, I can categorize them in 2 categories: 1. People Management 2. Sales Management. Q: I would appreciate if you tell us what do you mean by People management? A: The DSM in Lilly is responsible mainly for managing people performance, development, motivations, and their loyalty to the company. I mean I have to be close enough to give my support to my reporters without being too close; if it happens it will fire back at the team and I will be considered as a “Micro-Manager” rather than a Leader of winners’ team.

Q: Do you prefer to be a manager or to be a leader? A: A Leader for sure. Q: Why? A: Leaders are wise, admired, smart and talented managers. 23 Q: Do you think that the process of Managing people in Lilly helps you to be the leader you would like to? A: Well, there is no Utopia in the business; a lot of dynamics are there; however, Lilly established a framework which all employees can use it to define the relation between managers and subordinates. Q: Do you think this process helps? A: Yes, for big extent. However, some customization is mandatory.

Q: Do you think there is area of ambiguity in your role in managing people? A: No, I prefer to think about it as an opportunity for flexibility. I’m dealing everyday with different 6 personalities -even there are distal person who I communicate with them by different means- everyone has different level of expertise and different set of needs to be fulfilled. I can’t deal with all of them all the time with the same style. Q: Do you think that the managing person partially is the people’s responsibility in cooperation with their manager?

A: Of course, if we couldn’t conduct good communication between the team; the Situational Leadership approach will fail to meet the expectations. Interview with Mr. Sherif Zaki Who? ? Senior Sales Representative in Eli Lilly Saudi. ? He has worked in the same field since 2004 and in the same market since 2005. ? Sherif reports to Mr. Kishta. Q: Are you happy with your manager style in managing you? A: Not totally. But, my situation is better than many. 24 Q: Why do you say that?

A: Actually, the problem is that sometimes I feel empowered to do things that I do in good way; but other times as I’m a senior I used to be delegated to do things that I have no experience about them or maybe I don’t have the motivation to do them. Q: Do you implement the “Situational Leadership “process in your daily business conduct? A: I and Ahmed try to do that all the time; however, due to complexity of the process sometimes we go with the simple management styles. Q: What are the positives you believe in Lilly Situational Leadership process? A: It makes leaders; this is the most important thing.

Another thing this process considers personal variations and looks for level of motivation I have regarding certain objective. 25 References ? N. Beech, G. Cairns, H. Livingstone, C. Lockyer, H. Tsoukas (2009), “Managing People in Organizations”, SBS. ? http://www. lilly. com/about/Pages/about. aspx in 10th of August, 2011 08:00 PM ? S. Fowler, D. Zigarmi “Situational Self Leadership Process Basic Training Kit” (2003), The Ken Blanchard Companies ? Interview with Ahmed A Kishta, a MBA holder and DSM in Lilly ? Interview with Sherif K. Zaki, a Lilly employee 26

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Managing People in Organizations Assignment 2011

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