Summary Business Administration

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Business administration
Summary chapter 1

Companies have a lot of challenges to succeed.
Current challenges:
* Globalization: markets, technologies and organizations are becoming increasingly interconnected. * Ethics and social responsibility: issues of ethics and social responsibility are becoming increasingly important, and corporations are being expected to take a lead on addressing these issues * Speed of responsiveness: respond quickly and decisively to environmental changes, organizational crisis and shifting customer expectations * The digital workplace: many traditional managers feel awkward in today’s technology-driving workplace. * Diversity: today’s average worker is older, and many more women, ethnic minorities and immigrants are seeking job and advancement opportunities.

Organization: social entities that are goal-directed, are designed as deliberately structured and coordinated activity systems, and are linked to the external environment.

Managers deliberately structure and coordinate organization resources to achieve ‘the organizational purpose’

Differences between profit and non-profit companies
* The activities of managers in profit companies are in order to earn money whereas in non-profit are more about securing funding or raising capital. * Financial resources for non-profits come from sources such as government grants, private foundation grants and donations. In profit sectors it comes from the sale of products or services. * Non-profits have to measure intangible goals such as ‘improve the health’.

There are various ways to look at and think about an organization. Two important perspectives are: * Open systems: pays attention to the (open) boundary between the organization and its context. The relevance of open systems thinking and design has been underscored in recent years with regard to changes relating to the explosion of the internet and e-business, growing diversity of the workforce and the opening up of low wage labor economies such as China and India, or newer and lower-cost entrants to the global economy like Vietnam. * Closed systems: design focuses exclusively upon the organization without consideration of its dependence upon or capacity to influence elements comprising its context * Organizational configuration: systems thinking conceives of different parts of an organization being designed to perform the key subsystem functions

Henry Mintzberg suggests that every organization has five parts; these parts may vary in size and importance depending of an organization’s particular environment, technology and other factors. * Technical core: the people who do the basic work of the organization. It’s the production depart in a manufacturing firm, the teachers and classes in the university and the medical activities in a hospital. * Technical support: for example engineers and researchers that scan the environment for problems, opportunities and technical developments. Technical support includes departments such as technology, research and development and marketing research. * Administrative support: they are responsible for the smooth operation and upkeep the organization, including physical and human elements. This includes HRM department. * Management – top and middle: management is a function responsible for directing and coordinating other parts of the organization. * Top management provides direction, strategy, goals and policies for the entire organization or major division. * Middle management is responsible for implementation and coordination at the departmental level.

Organization dimensions can be categorized in two types
* Structural dimensions: provide labels to distinguish some key, internal characteristics of an organization, such as the degree of formalization. They provide the basis for comparing the composition of organizations * Contextual dimensions: characterize both the organization...
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