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Chapter 2 Environment, Diversity and Competitive Advantage. Planning Ahead What is the environment of organization? What are the challenges of managing diversity? What is a customer-driven organization? How is information technology changing the workplace?

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Chapter 2 environment diversity and competitive advantage
Chapter 2Environment, Diversity and Competitive Advantage

  • Planning Ahead

    • What is the environment of organization?

    • What are the challenges of managing diversity?

    • What is a customer-driven organization?

    • How is information technology changing the workplace?

    • Why is organizational learning important?

Schermerhorn - Chapter 2


External environments of organizations
External Environments of Organizations

  • What is Competitive Advantage also called Distinctive Advantage?

    • Utilization of a core competency that clearly sets an organization apart from its competitors and gives it an advantage over them in the marketplace

Schermerhorn - Chapter 2


External environments of organizations1
External Environments of Organizations

  • What is Competitive Advantage/ Distinctive Advantage? An advantage that is not easily copied Or understood by your competitors.

    • Companies may achieve it in many ways including

      • products

      • pricing

      • customer service

      • cost efficiency

      • Quality

      • Intellectual Capital

Schermerhorn - Chapter 2


External environments of organizations2
External Environments of Organizations

  • The General or Societal Environment - all of the background conditions of the organization including:

    • Economic

    • Social-cultural

    • Legal-political

    • Technological

    • Natural environment (Weather threats in SE)

Schermerhorn - Chapter 2


External environments of organizations3
External Environments of Organizations

  • The Specific Environment. This is called your Industry Environment in strategy - actual organizations, groups, persons with whom an organization must interact in order to survive and prosper

    • Stakeholders

      • Customers (Create demand and demand curves)

      • Suppliers (Part of your SC (Supply Chain)

      • Competitors (Direct and Indirect Competitors)

      • Regulators (Each industry has regulations and regulators)

      • Interest groups should be added. They include community, labor groups, MADD. harmed individuals, society.

Schermerhorn - Chapter 2


How is diversity managed in a multicultural organization
How is diversity managed in a multicultural organization

  • Characteristics of multicultural organizations:

    • Pluralism

    • Structural integration (glass ceiling)

    • Information network integration

    • Absence of prejudice and discrimination

      • Discrimination could be against any group of individuals

      • Prejudging is pervasive

    • Minimum inter-group conflict

Schermerhorn - Chapter 2


How is diversity managed in a multicultural organization1
How is diversity managed in a multicultural organization?

  • Organizational subcultures

    • Cultures based on shared work responsibilities and/or personal characteristics, ways of thinking and artifacts.

  • Common subcultures include:

    • Occupational

    • Functional

    • Ethnic

    • Racial

    • Generational

    • Gender

    • Class

Schermerhorn - Chapter 2


Organizational culture
Organizational Culture

  • A term used to explain an organizations culture.

  • Cultures include: ways of thinking and acting and all physical manifestations of culture:

  • Way of thinking: customer comes first, be positive

  • Way of acting: unfriendly, professional, ethically

  • Physical manifestations: awards, ceremonies, size of office, etc. (Culture and graduation ceremony)

Schermerhorn - Chapter 2


How is diversity managed in a multicultural organization2
How is diversity managed in a multicultural organization?

  • Diversity can be a source of competitive advantage or disadvantage. Wal-Mart

  • Diversity leadership approaches:

    • Affirmative action (Affirmative Action Plan)

    • Valuing diversity

    • Managing diversity;

      • How do you manage diversity in NBA?

      • How do you manage diversity in a department store?

      • How do you manage diversity in Big Four Accounting Firm?

Schermerhorn - Chapter 2


How is diversity managed in a multicultural organization3
How is diversity managed in a multicultural organization?

  • Personal challenge of managing diversity:

    • Accepting the goal of diversity maturity

  • Organizational challenge of managing diversity:

    • Changing organizational culture

    • Changing organizational mission practices

Schermerhorn - Chapter 2


Customer driven organizations
Customer-Driven Organizations

  • Customers and Operations Management

  • Remember organizations have internal as well as external customers. Internal customers coordinate with each other in transformation process

    • Operations

      • activities and decisions through which organizations transform resource inputs into product outputs

        • output of products can be goods or services

Schermerhorn - Chapter 2


Customer driven organizations1
Customer-Driven Organizations

  • Customer and Quality Operations

    • International Standards Organizations (ISO), Geneva Switzerland

      • ISO 9000 certification

        • provides customers with assurance that a set of solid quality standards and processes are in place

        • increasingly necessary to compete internationally

Schermerhorn - Chapter 2


Customer driven organizations2
Customer-Driven Organizations

  • Total Quality Management

    • Malcolm Baldrige National Quality Award

      • established in the U.S. in 1987

      • benchmark of excellence in quality achievements

      • criteria include

        • quality values are incorporated into day-to-day management

        • workers are trained in quality techniques

        • products are as good as or better than its competitor

        • Read article on Malcolm Baldrige http://www.findarticles.com/p/articles/mi_m1038/is_n4_v37/ai_15636464

Schermerhorn - Chapter 2


Winners of mbqa malcolm balridge quality award
Winners of MBQA (Malcolm Balridge Quality Award)

  • Given in manufacturing, service and small businesses

  • Motorola, Ritz Carlton, St. Luke’s of K.C.

    Note quality in production company, service organization

  • Motorola went for 10 and then 100 times improvement in quality in two succeeding years

Schermerhorn - Chapter 2


Eight guiding principles of tqm and mbqa
Eight Guiding Principles of TQM and MBQA

  • Formulate a vision of Quality

  • Have Top Management’s Complete Support

  • Focus on Customer needs (focus groups, internal and external customers)

  • Use Planning and Implementation for TQM program. (Benchmark)

  • Train Employees to Use SPC tools (process charts, Six Sigma, simple math)

  • Empower Employees (Ritz Carlton)

  • Recognize and Reward Employees (quality culture)

  • Make Continuous Improvement an Ongoing Process

Schermerhorn - Chapter 2


Customer driven organizations3
Customer-Driven Organizations

  • Quality and Continuous Improvement

    • Continuous Improvement

      • Always looking for new ways to improve upon current performance

Schermerhorn - Chapter 2


Information technology utilization
Information Technology Utilization

  • Information Needs of Organizations

    • Information

      • data made useful for decision making

        • intelligence

        • public

Schermerhorn - Chapter 2


Information technology utilization1
Information Technology Utilization

  • Information Systems and Networks

    • technology to collect, organize, and distribute data in such a way that they become meaningful as information

Schermerhorn - Chapter 2


Information technology utilization2
Information Technology Utilization

  • Information Systems and Networks

    • Management Information Systems (MIS)

      • specifically designed to use IT to meet the information needs of managers in daily decision-making

Schermerhorn - Chapter 2


Information technology utilization3
Information Technology Utilization

  • Chief Information Officer (CIO)

    • oversees all aspects of computer, information and telecommunications systems

    • central role in strategic decision-making

Schermerhorn - Chapter 2


Information technology utilization4
Information Technology Utilization

  • Intranets

    • networks of computers that use special software to allow persons working in various locations of the same organization to share databases and communicate electronically

  • Enterprise-wide networks

    • move information quickly and accurately from one point to another within an organization

Schermerhorn - Chapter 2


Information technology utilization5
Information Technology Utilization

  • Extranets

    • Internet networks that use the public Internet to allow communication between the organization and elements in its external environment

    • Electronic Data Interchange (EDI) allows companies to communicate electronically with one another (hardwired arrangement). Hi speed net has made much of EDI less used.

Schermerhorn - Chapter 2


Information technology utilization6
Information Technology Utilization

  • What is a Learning Organization?

    • a company that is able to continuously change and improve based on the lessons of experience

    • able to change due to the people, values and systems

Schermerhorn - Chapter 2


Information technology utilization7
Information Technology Utilization

  • Organizational Learning

    • mental models

    • personal mastery

    • systems thinking

    • shared vision

    • team learning

Schermerhorn - Chapter 2


Information technology utilization8
Information Technology Utilization

  • Knowledge Management

    • processes through which organizations develop, organize and share knowledge to achieve competitive advantage

      • Chief Knowledge Officer (CKO)

        • energizes learning processes

        • manages organizations intellectual assets

Schermerhorn - Chapter 2


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