6.4 The Management Process
Once we have gained a strong understanding of the company’s foundation, direction, and intended strategy, the effective performance of your business will require solid management: the process of planning, organizing, leading, and controlling. A plan enables you to take your business concept and/or strategy beyond the idea stage. It does not, however, get the work done. For that to happen, you have to organize things effectively. You’ll have to put people and other resources in place to make things happen. And because your note-taking venture is supposed to be better off with you in charge, you need to be a leader who can motivate your people to do well. Finally, to know whether things are in fact going well, you’ll have to control your operations—that is, measure the results and compare them with the results that you laid out in your plan. The management process below summarizes the interrelationship between planning and the other functions that managers perform. This chapter will explore planning, leading, and controlling in some detail. Organizing is an especially complex topic and deserves its own chapter.
Planning
Without a plan, it’s hard to succeed at anything. The reason is simple: if you don’t know where you’re going, you can’t move forward. Successful managers decide where they want to be and then figure out how to get there; they set goals and determine the best way to achieve them. As a result of the planning process, everyone in the organization knows what should be done, who should do it, and how to do it.
Coming up with an idea—say, starting a note-taking business—is a good start, but it’s only a start. Planning for it is a step forward. Planning begins at the highest level and works its way down through the organization. In the first section of this chapter, we answered the question ‘Why do we exist?’. In the second section we answered the questions ‘What business are we in?’ and ‘What are our objectives?’. Then finally, we examined ‘What are the company’s strengths, weaknesses, threats, and opportunities to develop a strategy?’. Sam Walton posed these questions in the process of founding Wal-Mart: his new chain of stores would exist to offer customers the lowest prices with the best possible service.[1]
Organizing
A second key function of managers is organizing, which is the process of coordinating and allocating a firm’s resources in order to carry out its plans. Organizing includes developing a structure for the people, positions, departments, and activities within the firm. Managers can arrange the structural elements of the firm to maximize the flow of information and the efficiency of work processes. They accomplish this by doing the following:
- Dividing up tasks (division of labour)
- Grouping jobs and employees (departmentalization)
- Assigning authority and responsibilities (delegation)
These and other elements of organizational structure are discussed in detail elsewhere. In this chapter, howev