INSTRUCTOR’S SOLUTIONS MANUAL
ESSENTIALS OF CONTEMPORARY MANAGEMENT
8TH CANADIAN EDITION
OVERVIEW OF THE CHAPTER
In this chapter we look at what management is, what activities or functions are involved in the man-
agement process, the types and levels of managers we find in organizations, and the role of a manager in
shaping organizational culture and creating high-performing teams. Additionally, we will discuss the
skills and roles that effective managers need to perform well. By the end of this chapter, you will have an
appreciation of the role of managers in creating a high-performing organization.
OPENING CASE
Opening Case: " Netflix Adopts a co-CEO Organizational Structure”
Summary
In the summer of 2020, Netflix CEO and founder, Reed Hastings announced that Chief Content Officer
Ted Sarandos, would join him as Co-CEO, sit on the Board of Directors and continue as Chief Content
Officer. It is an interesting move that gets away from the idea of having a single solitary leader whose success
results from command-and-control styled authority and decision making found in many conservative
corporate cultures. In fact, several companies who have tried a dual top manager structure- Salesforce.com,
SAP, and Oracle-all recently abandoned co-CEO arrangements. So why has Netflix decided to resurrect this
management model?
DISCUSSION QUESTIONS
After reading and understanding the concepts in this chapter, you should be able to answer the
following questions:
1. Would you characterize Netflix’s Organizational Culture as innovative or conservative? Why?
Suggested answer: The values, attitudes, moods and emotions of the founders and top managers
affect the organizational culture of a company. The way that employees interact with each other and
with management tend to be aligned with those values. Organizational culture is the shared set of
beliefs, expectations, values, norms, and work routines that influence how organizational members
cooperate to achieve goals. Founding managers are attracted to and hire employees who fit well with
their personal values and personality. A company’s culture influences the ways that top managers
plan, organize, lead, and control the resources of the company. The opening case demonstrates that
Netflix has an innovative culture by empowering employees to make good decisions and by
encouraging curiosity, passion, and inclusion. Management’s role is to provide context rather than
control. In innovative cultures, managers lead by example. From the case, we see that Hastings has
been a role model for Sarandos. In the controlling function, the way in which managers evaluate and
take actions to improve performance can be very formal and cautious (conservative) or flexible and
adaptive (innovative). Netflix has no formal rules that result in penalties when broken; rather, the
culture encourages accountability for actions taken. This innovative approach to control is not
, bureaucratic, but flexible and adaptive. Overall, the opening case illustrates an innovative culture at
Netflix.
2. What managerial skills does Sarandos bring to the co-CEO role?
Suggested answer: Managerial skills tend to fall into three categories: conceptual, interpersonal, and
technical. Conceptual skills are the ability to analyze and diagnose a situation and to distinguish
between cause and effect. Top-level managers utilize conceptual skills in planning, decision making,
crisis management, and strategy formulation. Sarandos uses conceptual skills in leading the
operational side of the business. Interpersonal skills are the ability to understand, alter, lead, and
control the behaviour of others. Managers at all levels use these skills when providing feedback and
supporting employees. Sarandos was selected by Hastings as co-CEO, indicating he shares the values
and beliefs that underlie the organizational culture of respect and collaboration. A high level of
interpersonal skills is also indicated by the fact that much of Hollywood respects Sarandos. Technical
skills are job-specific knowledge that is required to perform the work tasks. From the case, we
understand that Sarandos has a high level of technical skills—driving content development and
creating new TV shows and movies. He also has past experience in the specialized field of video and
DVD distribution.
3. What managerial role does Peters bring to the co-CEO role?
Suggested answer: As co-CEO, Peters acts in a variety of roles, depending upon the
situation before him. At times, he will need to serve as an organizational spokesperson as he
represents the organization to the company’s shareholders or external stakeholders. As co-
CEO, he shares in ultimate accountability for the firm’s results. Accordingly, he will need to
monitor the performance of the company’s managers, ultimately bearing responsibility for
the outcomes they generate. Like any manager, Peters will have to determine how Netflix
will allocate scare resources throughout the organization, ensuring all parts of the enterprise
are provided with the necessary resources they need to be successful. As the organization
continues to expand into new and existing markets, Peters will need to make decisions as an
Entrepreneur would, guiding the entity forward as the company continues to grow. Along the
way, he will need to keep his divisional leaders (and other employees) apprised of decisions.
Additionally, he will need to liaise with multiple stakeholder groups as he communicates
direction, answers questions, and provides overall support. Finally, he will continually serve
(and be seen) as leader in all he does. People will look to him for answers, for direction, and
as an example to follow. In sum, Peters’ role as co-CEO will require him to successfully act
in every managerial role.
4. Do you think Netflix can maintain and/or grow its current momentum? Why or why not?
Suggested answer: When Netflix first arrived in the marketplace, there was no real competition
facing the upstart enterprise. The company’s very inception was spurred by a recognition (on the part
of company founders) that an at-home movie streaming service represented a large, then unrealized,
opportunity in the marketplace. A review of the company’s revenue generation and growth patterns,
to date, reveal a history of marked success for the enterprise. However, continued success will hinge
on a willingness to adopt new ways of thinking, a refrain from resting upon past success, and
remaining innovative at every turn. Continued growth will be driven by the introduction of new
services (along with enhancement to existing services). Where the company was once enjoyed a
, marketplace free from real competition, it now faces a flood of new and seasoned entrants (each of
which serves as direct competition to Netflix). Thus, the company’s managers will need critically
determine (and act upon) their differentiating value proposition(s) in order to retain the growing,
industry-leading position which the enterprise has historically enjoyed. Next, company managers will
need to clearly and consistently communicate (and positively reinforce stakeholder commitment to)
the values, mission, and vision driving the enterprise. Moreover, they must plan, lead, organize, and
control strategy and resources in ways that reinforce commitment to company these considerations.
Newcomers must be socialized into the organizations in ways that ensure ongoing commitment and
supported in ways necessary to perform their jobs in ways that ultimately advance the organization in
these same ways.
END OF CHAPTER CONTENT
MANAGEMENT IN ACTION
TOPICS FOR DISCUSSION AND ACTION
Discussion
1. Describe what management is and what managers do to achieve organizational goals.
Answer:
Management is the process of efficiently and effectively acquiring, developing, protecting, and
utilizing organizational resources in the pursuit of organizational goals through planning, leading,
organizing and controlling.
Planning is a process or procedure used by managers so that they choose more appropriate goals and
courses of action for the organization.
In organizing managers establish the structure of working relationships between organizational
members that best allows them to work together to achieve organizational goals.
In leading, managers determine direction, articulate a clear vision for employees to follow, and
energize and enable employees so that they understand the part they play in achieving organizational
goals.
In controlling, managers evaluate how well an organization is achieving its goals and take corrective
action to maintain or improve its performance.
2. Describe the difference between efficiency and effectiveness.
Answer:
An organization’s performance is directly tied to the levels of efficiency and effectiveness exhibited
by managers within the organization. Efficiency can be described as a measure of how well or
productively resources are used to achieve an organizational goal. Efficiency can be increased by
minimizing inputs needed to achieve desired outputs. Effectiveness is a measure of the
appropriateness of the goals chosen and the degree to which they are achieved. Organizations are
more effective when managers choose appropriate goals and then achieve them. Efficiency refers to
how goals are achieved, while effectiveness refers to the appropriateness and utility of those goals.
3. Describe the primary responsibilities of the three levels of management and discuss the skills they use
in carrying out their roles and duties.
Answer:
, Managers at various levels within an organization have different but related types of responsibilities
for utilizing organizational resources to increase efficiency and effectiveness. First-line managers
have the day-to-day responsibility of supervising human resources, the employees or non-managerial
employees who actually perform the activities necessary to produce goods and services. Given the
knowledge of day-to-day operations that first-line managers have, they are often in good positions to
make suggestions to middle managers on how processes can be made more effective and efficient.
They utilize human skills in leading and motivating non-managerial employees and technical skills in
training, evaluating and controlling human resources. Conceptual skills are utilized least in carrying
out the roles and duties of the first line manager.
Middle managers supervise the first-line managers and have the added responsibility to find the
best way to combine human and other resources to achieve organizational goals. Middle managers
increase efficiency by finding ways to help first-line managers and employees better utilize resources
in order to reduce manufacturing costs or improving the way services are provided to customers. To
increase effectiveness, middle managers are responsible for evaluating whether or not the goals that
an organization is pursuing are appropriate and for suggesting ways in which they should be changed.
Since achieving these goals efficiently is the main focus, middle managers try to find the best ways to
use organizational resources. They also nurture and develop the organizational skills necessary for an
organization to be efficient and effective. Middle managers utilize human, conceptual and technical
skills in organizing and allocating resources to achieve organizational goals.
Top managers are at the apex of the managerial pyramid. They are responsible for supervising all
the departments in an organization and deciding how the different departments can cooperate and
work together to achieve organizational goals. They are ultimately responsible for the success or
failure of an organization. Top managers are responsible for establishing appropriate organizational
goals and monitoring the performance of each department in achieving those goals. Most of their time
is devoted to planning and organizing resources to maintain and improve efficiency and effectiveness,
which determine an organization’s long-term performance. They primarily utilize conceptual and
human skills in strategic planning and organizing.
Action
4. Ask a middle or top manager, perhaps someone you already know to give examples of how he or
she performs the management functions of planning, organizing, leading and controlling. How
much time does he or she spend in performing each function?
Answer:
(Note to instructor: Due to the nature of this question, individual answers may differ widely,
though students should address the following points in their answers.)
Mark Jayton is a production manager at clothing manufacturing company. In our discussion he
informed me that he performs all four management functions in varying degrees. He spends time
at the end of each month, quarter and year planning depart mental budgets, goals, and strategies
for the upcoming period. Once these strategic tools are completed, he must disseminate the
information to both his superiors and subordinates. He spends time organizing on a weekly basis,
when he must determine which project team should work on which production line and in what
order the projects should be completed. By organizing he needs to ensure that he is using his
human and material resources to their full capacity. Mark spends some time each day leading his
employees. He must motivate them to produce quality work and listen to their concerns and
problems on a regular basis. Mark performs the controlling function on a constant basis as he
monitors the performance of his department at all levels so that he is able to be proactive in
dealing with any issues or problems that could arise.
ESSENTIALS OF CONTEMPORARY MANAGEMENT
8TH CANADIAN EDITION
OVERVIEW OF THE CHAPTER
In this chapter we look at what management is, what activities or functions are involved in the man-
agement process, the types and levels of managers we find in organizations, and the role of a manager in
shaping organizational culture and creating high-performing teams. Additionally, we will discuss the
skills and roles that effective managers need to perform well. By the end of this chapter, you will have an
appreciation of the role of managers in creating a high-performing organization.
OPENING CASE
Opening Case: " Netflix Adopts a co-CEO Organizational Structure”
Summary
In the summer of 2020, Netflix CEO and founder, Reed Hastings announced that Chief Content Officer
Ted Sarandos, would join him as Co-CEO, sit on the Board of Directors and continue as Chief Content
Officer. It is an interesting move that gets away from the idea of having a single solitary leader whose success
results from command-and-control styled authority and decision making found in many conservative
corporate cultures. In fact, several companies who have tried a dual top manager structure- Salesforce.com,
SAP, and Oracle-all recently abandoned co-CEO arrangements. So why has Netflix decided to resurrect this
management model?
DISCUSSION QUESTIONS
After reading and understanding the concepts in this chapter, you should be able to answer the
following questions:
1. Would you characterize Netflix’s Organizational Culture as innovative or conservative? Why?
Suggested answer: The values, attitudes, moods and emotions of the founders and top managers
affect the organizational culture of a company. The way that employees interact with each other and
with management tend to be aligned with those values. Organizational culture is the shared set of
beliefs, expectations, values, norms, and work routines that influence how organizational members
cooperate to achieve goals. Founding managers are attracted to and hire employees who fit well with
their personal values and personality. A company’s culture influences the ways that top managers
plan, organize, lead, and control the resources of the company. The opening case demonstrates that
Netflix has an innovative culture by empowering employees to make good decisions and by
encouraging curiosity, passion, and inclusion. Management’s role is to provide context rather than
control. In innovative cultures, managers lead by example. From the case, we see that Hastings has
been a role model for Sarandos. In the controlling function, the way in which managers evaluate and
take actions to improve performance can be very formal and cautious (conservative) or flexible and
adaptive (innovative). Netflix has no formal rules that result in penalties when broken; rather, the
culture encourages accountability for actions taken. This innovative approach to control is not
, bureaucratic, but flexible and adaptive. Overall, the opening case illustrates an innovative culture at
Netflix.
2. What managerial skills does Sarandos bring to the co-CEO role?
Suggested answer: Managerial skills tend to fall into three categories: conceptual, interpersonal, and
technical. Conceptual skills are the ability to analyze and diagnose a situation and to distinguish
between cause and effect. Top-level managers utilize conceptual skills in planning, decision making,
crisis management, and strategy formulation. Sarandos uses conceptual skills in leading the
operational side of the business. Interpersonal skills are the ability to understand, alter, lead, and
control the behaviour of others. Managers at all levels use these skills when providing feedback and
supporting employees. Sarandos was selected by Hastings as co-CEO, indicating he shares the values
and beliefs that underlie the organizational culture of respect and collaboration. A high level of
interpersonal skills is also indicated by the fact that much of Hollywood respects Sarandos. Technical
skills are job-specific knowledge that is required to perform the work tasks. From the case, we
understand that Sarandos has a high level of technical skills—driving content development and
creating new TV shows and movies. He also has past experience in the specialized field of video and
DVD distribution.
3. What managerial role does Peters bring to the co-CEO role?
Suggested answer: As co-CEO, Peters acts in a variety of roles, depending upon the
situation before him. At times, he will need to serve as an organizational spokesperson as he
represents the organization to the company’s shareholders or external stakeholders. As co-
CEO, he shares in ultimate accountability for the firm’s results. Accordingly, he will need to
monitor the performance of the company’s managers, ultimately bearing responsibility for
the outcomes they generate. Like any manager, Peters will have to determine how Netflix
will allocate scare resources throughout the organization, ensuring all parts of the enterprise
are provided with the necessary resources they need to be successful. As the organization
continues to expand into new and existing markets, Peters will need to make decisions as an
Entrepreneur would, guiding the entity forward as the company continues to grow. Along the
way, he will need to keep his divisional leaders (and other employees) apprised of decisions.
Additionally, he will need to liaise with multiple stakeholder groups as he communicates
direction, answers questions, and provides overall support. Finally, he will continually serve
(and be seen) as leader in all he does. People will look to him for answers, for direction, and
as an example to follow. In sum, Peters’ role as co-CEO will require him to successfully act
in every managerial role.
4. Do you think Netflix can maintain and/or grow its current momentum? Why or why not?
Suggested answer: When Netflix first arrived in the marketplace, there was no real competition
facing the upstart enterprise. The company’s very inception was spurred by a recognition (on the part
of company founders) that an at-home movie streaming service represented a large, then unrealized,
opportunity in the marketplace. A review of the company’s revenue generation and growth patterns,
to date, reveal a history of marked success for the enterprise. However, continued success will hinge
on a willingness to adopt new ways of thinking, a refrain from resting upon past success, and
remaining innovative at every turn. Continued growth will be driven by the introduction of new
services (along with enhancement to existing services). Where the company was once enjoyed a
, marketplace free from real competition, it now faces a flood of new and seasoned entrants (each of
which serves as direct competition to Netflix). Thus, the company’s managers will need critically
determine (and act upon) their differentiating value proposition(s) in order to retain the growing,
industry-leading position which the enterprise has historically enjoyed. Next, company managers will
need to clearly and consistently communicate (and positively reinforce stakeholder commitment to)
the values, mission, and vision driving the enterprise. Moreover, they must plan, lead, organize, and
control strategy and resources in ways that reinforce commitment to company these considerations.
Newcomers must be socialized into the organizations in ways that ensure ongoing commitment and
supported in ways necessary to perform their jobs in ways that ultimately advance the organization in
these same ways.
END OF CHAPTER CONTENT
MANAGEMENT IN ACTION
TOPICS FOR DISCUSSION AND ACTION
Discussion
1. Describe what management is and what managers do to achieve organizational goals.
Answer:
Management is the process of efficiently and effectively acquiring, developing, protecting, and
utilizing organizational resources in the pursuit of organizational goals through planning, leading,
organizing and controlling.
Planning is a process or procedure used by managers so that they choose more appropriate goals and
courses of action for the organization.
In organizing managers establish the structure of working relationships between organizational
members that best allows them to work together to achieve organizational goals.
In leading, managers determine direction, articulate a clear vision for employees to follow, and
energize and enable employees so that they understand the part they play in achieving organizational
goals.
In controlling, managers evaluate how well an organization is achieving its goals and take corrective
action to maintain or improve its performance.
2. Describe the difference between efficiency and effectiveness.
Answer:
An organization’s performance is directly tied to the levels of efficiency and effectiveness exhibited
by managers within the organization. Efficiency can be described as a measure of how well or
productively resources are used to achieve an organizational goal. Efficiency can be increased by
minimizing inputs needed to achieve desired outputs. Effectiveness is a measure of the
appropriateness of the goals chosen and the degree to which they are achieved. Organizations are
more effective when managers choose appropriate goals and then achieve them. Efficiency refers to
how goals are achieved, while effectiveness refers to the appropriateness and utility of those goals.
3. Describe the primary responsibilities of the three levels of management and discuss the skills they use
in carrying out their roles and duties.
Answer:
, Managers at various levels within an organization have different but related types of responsibilities
for utilizing organizational resources to increase efficiency and effectiveness. First-line managers
have the day-to-day responsibility of supervising human resources, the employees or non-managerial
employees who actually perform the activities necessary to produce goods and services. Given the
knowledge of day-to-day operations that first-line managers have, they are often in good positions to
make suggestions to middle managers on how processes can be made more effective and efficient.
They utilize human skills in leading and motivating non-managerial employees and technical skills in
training, evaluating and controlling human resources. Conceptual skills are utilized least in carrying
out the roles and duties of the first line manager.
Middle managers supervise the first-line managers and have the added responsibility to find the
best way to combine human and other resources to achieve organizational goals. Middle managers
increase efficiency by finding ways to help first-line managers and employees better utilize resources
in order to reduce manufacturing costs or improving the way services are provided to customers. To
increase effectiveness, middle managers are responsible for evaluating whether or not the goals that
an organization is pursuing are appropriate and for suggesting ways in which they should be changed.
Since achieving these goals efficiently is the main focus, middle managers try to find the best ways to
use organizational resources. They also nurture and develop the organizational skills necessary for an
organization to be efficient and effective. Middle managers utilize human, conceptual and technical
skills in organizing and allocating resources to achieve organizational goals.
Top managers are at the apex of the managerial pyramid. They are responsible for supervising all
the departments in an organization and deciding how the different departments can cooperate and
work together to achieve organizational goals. They are ultimately responsible for the success or
failure of an organization. Top managers are responsible for establishing appropriate organizational
goals and monitoring the performance of each department in achieving those goals. Most of their time
is devoted to planning and organizing resources to maintain and improve efficiency and effectiveness,
which determine an organization’s long-term performance. They primarily utilize conceptual and
human skills in strategic planning and organizing.
Action
4. Ask a middle or top manager, perhaps someone you already know to give examples of how he or
she performs the management functions of planning, organizing, leading and controlling. How
much time does he or she spend in performing each function?
Answer:
(Note to instructor: Due to the nature of this question, individual answers may differ widely,
though students should address the following points in their answers.)
Mark Jayton is a production manager at clothing manufacturing company. In our discussion he
informed me that he performs all four management functions in varying degrees. He spends time
at the end of each month, quarter and year planning depart mental budgets, goals, and strategies
for the upcoming period. Once these strategic tools are completed, he must disseminate the
information to both his superiors and subordinates. He spends time organizing on a weekly basis,
when he must determine which project team should work on which production line and in what
order the projects should be completed. By organizing he needs to ensure that he is using his
human and material resources to their full capacity. Mark spends some time each day leading his
employees. He must motivate them to produce quality work and listen to their concerns and
problems on a regular basis. Mark performs the controlling function on a constant basis as he
monitors the performance of his department at all levels so that he is able to be proactive in
dealing with any issues or problems that could arise.
