1. Change
1.1. Definition
1.1.1. Movement of an organization away from its present state and toward some desired future state to increase its efficiency and effectiveness
1.2. Four Steps in the Organizational Change
1.2.1. Assess the need for change
1.2.2. Decide on the change to make
1.2.3. Implement the changge
1.2.4. Evaluate the change
1.3. Organizational Learning
1.3.1. Increase organizational members’ abilities to understand and appropriately respond to changing conditions
1.3.2. Impetus for change
1.3.3. Can help members make decisions about changes
1.4. Top-Down Change
1.4.1. Identify what needs to be changed and then move quickly to implement changes throughout the organization
1.5. Bottom-Up Change
1.5.1. Work together to develop a detailed plan for change
1.6. Benchmarking
1.6.1. Comparing company’s performance on specific dimensions with the performance of other high performing organizations
2. Entrepreneurship
2.1. Entrepreneurs
2.1.1. Notice opportunities and take responsibility for mobilizing the resources necessary to produce new and improved goods and services
2.2. Intrapreneurs
2.2.1. Notice opportunities for product or service improvements and are responsible for managing the development process
2.3. Entrepreneurship
2.3.1. Mobilization of resources to take advantage of an opportunity to provide customers with new or improved goods and services
2.4. Be a manager
2.4.1. The kind of output controls will best facilitate positive interactions the teams
3. Operating Budgets
3.1. A blueprint that states how managers intend to allocate and use the resources they control to attain organizational goals effectively and efficiently
3.2. Lower-level managers are evaluated for their ability to stay within the budget and to make the best use of available resources
3.3. Three components
3.3.1. Objective financial measures
3.3.2. Challenging goals and performance standards
3.3.3. Appropriate operating budgets
4. Control
4.1. Control systems
4.1.1. Flexible
4.1.2. Accurate
4.1.3. Timely manner
4.2. Three types of control
4.2.1. Feedforward control
4.2.2. Concurrent control
4.2.3. Feedback control
4.3. Four steps in organizational control
4.3.1. Establish the standard of performance, goals... against which performance is to be evaluatedd
4.3.2. Measure actual performance
4.3.3. Compare actual performance against chosen standards of performance
4.3.4. Evaluated the result and initiate corrective action if the standard is not being achieved
4.4. Three organizational control systems
4.4.1. Output control
4.4.1.1. Financial measures of performance
4.4.1.2. Organizational goals
4.4.1.3. Operating budgets
4.4.2. Behavior control
4.4.2.1. Direct supervision
4.4.2.2. Management by objectives
4.4.2.3. Rules and standard operating procedures
4.4.3. Bureaucratic control
4.4.3.1. A comprehensive system of rules and standard operating procedures
4.4.3.2. Problems
4.4.3.2.1. “red tape”
4.4.3.2.2. Slowing organizational reaction times to problems
4.4.3.2.3. Loss of flexibility, new ideas, and creative problem solving
4.4.4. Organizational culture/clan control
4.4.4.1. Values
4.4.4.2. Norms
4.4.4.3. Socialization
5. Financial Measures of Performance
5.1. Profit Ratios
5.1.1. Measures of how efficiently managers convert resources into profits
5.1.2. Return on investment (ROI)
5.1.2.1. = net profit before taxes/total assets
5.2. Liquidity Ratios
5.2.1. Measures of how well managers protect resources to meet short term debt
5.2.1.1. Current ratio
5.2.1.1.1. = current assets/current liabilities
5.2.1.2. Quick ratio
5.2.1.2.1. = (current assets - inventory)/current liabilities
5.3. Leverage Ratios
5.3.1. Measures of how much debt or equity is used to finance operations
5.3.1.1. Debt-to-assets ratio
5.3.1.1.1. = total debt/total assets
5.3.1.2. Time-covered ratio
5.3.1.2.1. = profit before interest and taxes/total interest charges
5.4. Activity Ratios
5.4.1. Measures of how efficiently managers are creating value from assets
5.4.1.1. Inventory turnover ratio
5.4.1.1.1. = cost of goods sold/inventory
5.4.1.2. Day sales outstanding ratio
5.4.1.2.1. = current accounts receivable/sales for period divided by days in period
6. Goal
6.1. Organizational Goals
6.1.1. specific and difficult but attainable
6.1.2. Stretch Goals
6.1.2.1. challenge and stretch managers' ability
6.1.2.2. not out of reach
6.1.2.3. do not require an impossibly high expenditure of managerial time and energy
6.2. Organization-Wide Goal Setting
6.2.1. Corporate - level managers set goals for individual divisions
6.2.2. Divisional managers set goals for each function
6.2.3. Function managers set goals for each individual worker