Small Business Discussion Board 11
cam15
Chapter_19_Professional_Mgt_and_Small_Business.pdf
Small Business Management, 18e
Longenecker/Petty/Palich/Hoy
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Professional Management and
the Small Business
Chapter 19
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service or otherwise on a password-protected website for classroom use.
Learning Goals:
Understand the entrepreneur’s leadership
role.
Explain the small business management
process and its unique features.
Identify the managerial tasks of
entrepreneurs.
Describe the problem of time pressure and
suggest solutions.
Outline the various types of outside
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service or otherwise on a password-protected website for classroom use.
Small Business Leadership
What is Leadership?
Involves pointing the way: creating and
communicating the entrepreneur’s vision of
the firm.
Varies in a business as it grows larger and
more mature.
Leadership Qualities of Founders
A tolerance for ambiguity
A capacity for adaptation
19–4
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
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Small Business Leadership
(cont.) What Makes a Leader Effective?
One who is focused intently on attaining the
firm’s business goals.
One who creates a significant personal
relationship with employees based on loyalty
and respect.
One who directly influences employees’
understanding of how the firm operates (e.g.,
its ethics).
One who makes the firm attractive to new
employees. 19–5© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
Small Business Leadership (cont’d)
Leaders Shape the Culture of the Organization
Empowerment
Giving employees authority to make decisions and take
actions on their own
Self-Managed Work teams
Groups of employees with the freedom to function
without close supervision
Working environment
Workers are affected by their surroundings
Good Hiring
Employees who fit the personality of the firm 19–6
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The Small Firm Management Process
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Professional-Level
Management
Managerial
Weakness Issues in the
Management
of Small Firms
Resource
Constraints
Firm Growth and
Managerial
Practices
Founders as
Managers
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Organizational Stages of Small Business Growth19.1
Stages in Firm Growth and Management
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Growth Stage Entrepreneur’s Workload
Stage 1. One-Person Operation Doing all of the work. Making contact
with customers.
Stage 2. Player-Coach Continuing to do some of the basic
work, although learning to hire and
supervise.
Stage 3. Intermediate Supervision Rising above hands-on management;
working through intermediate
managers.
Stage 4. Formal Organization Using plans and budgets; following
policies and procedures.
Managing Versus Doing
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STAGE 1 STAGE 2 STAGE 3 STAGE 4 One-Person
Operation Player-Coach Intermediate
Supervision Formal
Organization
Time spent managing Time spent doing
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Creating an Organizational Structure
The Unplanned Structure
Structure evolves as the firm evolves.
Growth creates the need for structural change.
Chain of Command
The official, vertical channel of communication in
an organization
A channel for two-way communication
Span of Control
The number of subordinates supervised by one
manager 19–11
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Creating Structure (cont.)
Line Organization
A simple organization in which each person
reports to one supervisor
Line and Staff Organization
An organizational structure that includes staff
specialists who assist management
19–12
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Creating Structure (cont.)
Line and Staff Organization (cont.)
Line activities
Activities contributing directly to the primary
objectives of the firm
Staff activities
Activities that support line activities
19–13
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Line-and-Staff Organization19.2
Factors Determining Optimum Span of Control
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Many Subordinates Simple work
Very experienced workers
Superior with much ability
Few Subordinates Complex work
Inexperienced workers
Superior with limited ability
More Subordinates Moderately difficult work
Moderately experienced workers
Superior with moderate ability
Creating Structure (cont.)
Understanding Informal Groups
Have something in common.
Have an informal leadership hierarchy.
Are beneficial if group goals are aligned with
organizational goals.
19–16
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
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Delegating Authority
Delegation of Authority
Granting to a subordinate the right to act or
make decisions
Benefits of Delegation
Frees up superior to perform more
important tasks
Develops subordinate’s skills
Improves two-way communications
19–17
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Controlling Operations
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Measuring
Performance
Establishing
standards
Planning and
Goal Setting
Taking Corrective
Action
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Stages of the Control Process19.3
Communicating
Stimulating Two-Way Communication
Periodic performance review sessions for
feedback.
Bulletin boards to keep employees informed.
Blogs, microblogs and wikis for internal
communication
Suggestion boxes to solicit employees’ ideas.
Staff meetings to discuss issues and problems.
Informal meetings with employees
to socialize and talk.
19–20
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Presentation Tips
1. Do your homework.
2. Know your material.
3. Be interactive.
4. Make vivid mental connections in the minds of listeners.
5. Emphasize relevance.
6. Be dynamic, but be yourself.
7. Use PowerPoint with care.
8. Dress appropriately.
9. Avoid food and drink that make speaking difficult for you.
10. Practice, practice, practice.
19.4
Negotiating
Negotiation
Two-way communication used to resolve
differences in needs, goals, or ideas.
Win-lose negotiations
One party must win and the other party must lose.
Win-win negotiations
Both parties find a solution that satisfies both
parties’ basic interests.
End result of negotiations promotes
long-term continuing relationships.
19–22
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Personal Time Management
The Problem of Time Pressure
Many owner-managers work 40-80 hours per
week.
Effect of overwork is inefficient work
performance.
19–23
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Personal Time Management
(cont.)
Time Savers for Busy Managers
Effective use of time (time management)
Analyze how time is normally spent
Eliminate practices that waste time
Carefully plan available time
Use a daily planner to prioritize activities
Don’t avoid unpleasant or difficult tasks
Limit conference and meeting times
19–24
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part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
Outside Management Assistance
The Need for Outside Assistance
To supplement entrepreneur’s personal knowledge
and experience.
To provide opportunities to share ideas with peers.
To reduce feelings of loneliness and working in
isolation.
To have access to outsiders’ detached, objective
viewpoints, insights and ideas.
To gain fresh knowledge of methods, approaches,
and solutions beyond the experience of the
entrepreneur. 19–25
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distributed with a certain product or service or otherwise on a password-protected website for classroom use.
Sources of Management Assistance
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password-protected website for classroom use.
Business
Incubators
Student
Consulting
Teams
Service Corps of
Retired Executives
(SCORE)
Small Business
Development
Centers (SBDCs)
Management
Consultants
Entrepreneurial
Networks
Other Business
and Professional
Services
Source of
Outside
Management
Assistance
Key Terms
budget
chain of command
delegation of authority
empowerment
line-and-staff organization
line organization
long-range plan (strategic
plan)
negotiation
networking
professional manager
self-managed work teams
Service Corps of Retired
Executives (SCORE)
short-range plan
small business development
centers (SBDCs)
span of control
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