Management Assignment 2 Chapter 3 Participation

Apply Your Skills: Experiential Exercise - Page 85

Working in an Adaptability Culture A typical average score for management openness to change is about a 3. My score equals 3.80 and is close to 4 which I worked in an organization that expressed strong cultural values of adaptation. Discuss: When I worked for Autumn Village, a skilled nursing facility, changes were occurring daily that affected employees daily duties. At first, I do not think the facility intended for the changes to occur so rapidly which led to many employees being confused about what was going on and if they were performing their job correctly. Luckily my managers allowed me to attend whatever seminars I thought would be influential to myself and the company as a whole. The seminars prepared me for the changes that were going to occur as the Health Care Reform unfolded. Because Management allowed me to attend all the seminars I wanted they in return expected me to challenge or change the status quo if needed. This led me to have a lot of say in how our day to day operations were performed and they also expected me to pass my knowledge on to other Business Office Managers by going to their facilities to show and implement any changes I thought were necessary for the company to operate successfully. Changes were occurring so rapidly due to technology innovation within all providers we did business with, such as, Medicare, Medicaid, and insurance providers. All providers needed to update their software to make sure it would be compatible with Medicare's new billing procedure. While businesses updated their software they also implemented their own changes that would make billing easier for themselves to control and easier for health care facilities to collect their revenue in the long run. This meant that many new billing procedures and policies were implemented meaning if you did not stay up-to-date with these changes and billed as you always did claims would get denied and no money would be paid until claim was billed

correctly following new procedures. On top of all this I recommended to management that we would also need to update our software because our software vender was going out of business because they were not able to adapt to the changes that were occurring within the healthcare industry. At the time this meant that we would have to shop for new software, implement, and do a conversion within the next five months which normally should be better planned within an organization giving them plenty of time for trial and error. Needless to say, management was very thankful that I brought that change to their attention when I did and I also held a big part in finding and implementing the new software. It was a nightmare but in the end it all worked out just fine. I think that during the conversion between softwares management had a major wake up call and realized that they need to be more alert and adaptive to the changes that were occurring within the industry if they wanted to be competitive and survive all the uncontrollable changes that would be thrown at them in the future. After this things began to change and management began to listen to employees more than they did in past. Senior management also had many different meetings that not only involved senior management like in the past but the whole company were they encouraged all ideas and concerns from everyone. This definitely boosted the employee moral and made the environment more satisfying because it was obvious that employees enjoyed being at work. So at one point my company was only average which my score indicated but after making a few mistakes and noticing that if they did not adapt to the software changes when they did they would have been in a lot of trouble because they wouldnt of been able to collect revenue timely and also would not have the up-to-date software that supplied and kept data required to follow new Medicare billing regulations and procedures accordingly, which could of resulted in substantial fines if caught. Companies are more successful if they adapt to change. Today it is crucial in any organization. Now more so than ever, businesses should be open to change management to help with the sustainability, and in some cases, the survival of their business. The more effectively you are able to deal with change, the more likely you are to thrive. Chapter 4 Participation

New Manager Self-Test - Page 110

Are You Culturally Intelligent Questions 1-3 pertain to the head (cognitive QC subscale) I answered less than 2 of 3 Questions 4-6 pertain to the heart (emotional QC subscale) I answered all Mostly True Questions 7-9 pertain to behavior (physical QC subscale) I answered all Mostly True I answered 7 questions Mostly True so I am considered to have a high level of QC for a new manager. Discuss: Cultural intelligence or CQ is a theory within management and organizational psychology, positing that understanding the impact of an individuals cultural background on their behavior is essential for effective business, and measuring an individuals ability to engage successfully in any environment or social setting. Questions 1 through 3 pertain to the cognitive subscale and means head which also means learning about your own and other cultures, and cultural diversity. I had 2 mostly false and 1 mostly true is this subscale which suggests that I could use more training in this area so I am sure to have the knowledge and capacity needed for dealing with people form other national cultures. Questions 4 through 6 pertain to the emotional subscale and means heart which consists of gaining rewards and strengths from acceptance and success. I scored mostly true on all these questions which means I have the experience needed to deal with people from other national cultures in this subscale. Questions 7 through 9 pertain to the physical subscale and means body which uses your senses and adapting movements and body language to blend in. I answered mostly true to all these questions which also means I have the knowledge needed to deal with people from other national cultures in this subscale. CQ is measured on a scale. Based on my results and answering more than six out of the nine questions Mostly True my CQ is high. This means I am better able to successfully blend in to any environment, using more effective business practices, than those with a

lower CQ. Cultural intelligence is a particular concern for people temporarily or permanently residing in another country where not knowing what to expect and the differences that can be encountered upon arrival and in the early stages of setting in can often result in culture shock, the disorientation felt by a person subjected to an unfamiliar way of life.

Chapter 3 Assignment

Discussion Question 10 - Page 85

10. General Electric is famous for firing the lowest-performing 10 percent of managers each year. With its strict no-layoff policy, Valero Energy believes people need to feel secure in their jobs to perform their best. Yet both are high-performing companies. How do you account for the success of such opposite philosophies? Answer: When running a high-performing company innovation and cultural change are a must. What works for one company may not work for another. A true high-performance organizational culture provides a company with its single greatest source of competitive advantage. The culture inspires people to go the extra mile to make and execute good decisions even when nobodys looking. Both General Electric and Valero Energy are high performing organizations. Each company has different philosophies on how handle their employees. In high-performing organizations you must have the right leader and know that people are most important to a companies success. Recourses that fuel growth and job satisfaction are critical. Core competencies communicated through a statewide learning and development program and nurtured respect for expectations of the company are realized as the extent of opportunity that exists in their career tracks. For more than 125 years, General Electric has demonstrated an solid commitment to performance with integrity. At the same time they have expanded internationally, into new businesses and new regions, and built a great record of sustained growth. GE has built a worldwide reputation for lawful and ethical conduct. The reputation has never

been stronger. In several surveys of CEOs, GE has been named the worlds most respected and admired company. They have been ranked first for integrity and governance. (http://files.gecompany.com/gecom/citizenship/pdfs/TheSpirit&TheLetter.PDF) General Electric philanthropy and practice has been employed for over 20 years and has made GE the most valuable company in the world. Led by charismatic CEO, Jack Welsh, CEO who makes change constant, institutes big programs, but demands non-stop performance. This type of company is not for everyone and is led by high performers that make a lot of money. To determine high performers executives grade managers on A, B or C scale. The As get bonuses and stock options. The Cs were at risk. Every year, managers have to fire the bottom 10% of all managers. Performance evaluation was a continual process and evaluates on how employers treated, developed their people, and upheld the companys values. If they did not do well on both results and culture, they were out. This process is almost like a professional team, with highly competent and motivated athletes. As in professional teams you can have a high level of teamwork without any job security.(http://www.maccoby.com/Articles/LearnFromJack.shtml) Valero is committed to their employees and considers them their number one asset. The company believes that an investment in its employees from competitive pay and benefits to a caring company cultures an investment in the future of Valero and its communities. Their no-layoff policy is the fact that there is no real economic advantage or disadvantage to having the policy over the long run. Job security, increased employee morale, positive public perception, economic goals, and reduced legal liability are some beneficial traits for implementing the no-layoff policy. Most layoff occurs due to changes in the external environment in which company operates. Important disadvantages are changing employee job assignments, decreased manpower flexibility, increased management resources, personal sacrifices, and overstaffing. Research over the past five years indicates that cynicism is on the rise in American business and industry, which increasingly hurts their competitiveness and ability to

accommodates todays needed organizational change. President of the American Institute of Stress, indicates that recent, dizzying changes in technology and the economy are causing unprecedented burnout, cynicism, sickness and absenteeism. (http://managementhelp.org/prsn_wll/cynicism/research.htm) Over the past 20 years, confidence in business has fallen from 70% to 15%, and ratings of management competence and trust have fallen almost as among workers in the same period. Claims, It has now reached the point where cynicism is chic and loyalty to the company is for saps and suckers. (http://managementhelp.org/prsn_wll/cynicism/research.htm) In conclusion, it todays high performing organizations cultures it is extremely important to only hire strong people. GE and Valero Energy are high-level cultures with a long-term record of success. Its a very demanding environment that requires employees who are innovative and can perform as a cultural leader who uses signals and symbols to influence corporate culture. Sources Immelt, Jeffrey R, Cbairman of the Board & Chief Executive Officer. www.ge.com. The Spirit & The Letter, June 2005. Web. June 2, 2011 <http://files.gecompany.com/gecom/citizenship/pdfs/TheSpirit&TheLetter.pdf> Aenlle, Conrad General Electric, sleeping giant of Wall Street. April 2, 2007. Web. June 2, 2011 from <http://www.nytimes.com/2007/04/06/your-money/06ihtmge.4.5176872.html?pagewanted=2> General Electric Company. 2011, Web. June 3, 2011 <http://www.ge.com/company/culture/working_environment.html> Performance Evaluations, Business Strategy, and Agile Methodologies, June 7, 2009. Web. June 3, 2011 <http://kallokain.blogspot.com/2009/06/performance-evaluationsbusiness.html> Chapter 4 Assignment

Case for Critical Analysis Question 1 - Page 119

How would you characterize the main economic, legal-political, and sociocultural differences influencing the relationship between the partners in Shui Fabrics? What GLOBE Project dimensions would help you understand the differences in Chinese and American perspectives illustrated in the case? Answer: Economic, legal-political and sociocultural influence the differences in their relationships. Below I will discuss each environment and why each partner views them differently. Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. For example, interest rates affect a firms cost of capital and therefore to what extent a business grows and expands. Exchange rates affect the costs of exporting goods and supply and price of imported goods in an economy. There are economic differences that influence the relationship between the partners at Shui Fabrics. Chiu Wai, operated Shanghai Fabrics LTC located in China, before it became a joint venture with Rocky River Industries in the United States. When the companies became a venture, Chiu Wai became the Deputy General Manager for Shui Fabrics in China and venturing company Rocky River Industries located in US. Ray Betzell who is the General Manager for Shui Fabrics came to China from Rocky River Industries. Many companies who do business in others countries and cultures fail miserably. Managers must do their homework and learn the business ethic and culture lifestyles before even considering venturing into markets in different counties. To me it seems like neither of the managers did their homework and are having problems maintaining the economic factors that influence their company. A developing country is a non industrialized poor country that is seeking to develop its resources by industrialization. A developed country is a country that have a high level of development according to some criteria such as income per capita and industrialization.

Countries with high gross domestic product per capita would be described as developed countries. The World Economic Outlook Databases data reported in 2010 that the GDP per capita (US$) for China was 3,678 and United States was 46,381. (http://www.imf.org/external/pubs/ft/weo/2010/01/weodata/index.aspx) According to these figures China is considered more of a developing country rather than a developed country like the United States. Infrastructure is the basic physical and organizational structures needed for the operations of a society or enterprise, or the services and facilities necessary for an economy to function. Typically referring to the technical structures that support a society, such as roads, supply, sewers, electrical grids, telecommunications, and so forth. The infrastructure between the two companies differ because of the fact that one company is in China and the next is from the United States. Chinas economic development is not the same as the U.S.. China is attractive for low-cost manufacturing of goods and is in the lower level of technology and consists of perplexing logistical, distribution, and communication problems. United States infrastructure has great physical facilities. According to the Global Competitiveness Index Report for 2010-2011 China ranked 72nd out of 139 states in quality of overall infrastructure and the United States ranked 23rd out of 139. (http://gcr.weforum.org/gcr2010/ Many foreign companies are finding it tough to generate acceptable profits. Even the Japanese, historically the biggest investors, are seeing their lowest returns in China. China is also becoming a more expensive place to do business. More and more competitive Japanese corporations have begun to pull out of the market-they are a little further along the exit curve than Paul and Ray Betzell are. (http://www.imf.org/external/pubs/ft/weo/2010/01/weodata/index.aspx)

Political-Legal factors include discrimination, consumer, antitrust, employment, and health and safety law. They also include how and to what degree a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labor law, environmental law, trade restriction tariffs, and political stability. These factors can affect

how a company operates, its costs, and the demand for its products. Political factors may also include goods and serves which the government wants to provide or be provided and those that the government does now want to be provided. Furthermore, governments have great influence on the health, education, and infrastructure of a nation. Political officials are going to be a big part of the team because they have strong influence on economic life in China. Ray must reach out to them and understand their goals. Success will depend on the personal involvement of top executives. The partners differ dramatically in terms of what constitutes an acceptable financial return. Chiu Wai is happy with achieving a 5% to 6% profit and believes he is viewed as a local hero. Upon achieving his goal he feels that he has done a good job for his country morally and for their side of enterprise by creating jobs for close to 3,000 people. He wants to grow the scope of Shui Fabrics and establish a national brand. Ray Betzell wants a 20% ROI and will only consider growth if it improves profitability, has no interest in creating employment unless it improves the bottom line, is considering maybe having to layoff employees to improve bottom line. He wants to improve quality, and sees no benefit to creating a Chinese brand because it views China as a low-cost manufacturing platform rather than a market. Social factors include the cultural aspects and include health consciousness, populations growth rate, age distribution, career attitudes and emphasis on safely. Trends in social factors affect the demand for a companys products and how the company operates. With this being said, Ray needs to move outside his personal comfort zone as a manager. There seems to be a lack of clear, shared strategy between the two partners. When the company started 10 years ago, Rocky River has launched Shui Fabrics, a 50/50 joint venture between the U.S. textile manufacture and the Chinese company, to produce dye, and coat fabric for sale to both Chinese and international sportswear manufacturers. Intent seemed clear in beginning after many obstacles, considerable red tape and several money losing years the joint venture was fulfilling China expectations and those of local

government and party officials. It seems there was once a clear strategy that has been forgotten over the course of ten years. Another social factor that is different between the partners would be that a profit over 20% return on investment may be perceived as Western exploitation. When it comes to doing business in China, respect for peoples feelings is paramount - this sensitivity that needs to be taken in respect to peoples face. Face - a clich, is the currency of advancement. Its like a social bank account. You spend it and you save it and you invest. And when you take away somebodys face you take way someones fundamental sense of security. Because of Chinas history of exploitation by foreign countries who colonized China or raided China for business purposes, particulary in the business sphere, Chinese do not want to be seen culturally as having been had by Western businesspeople. (http://www.nytimes.com/2010/12/14/business/global/14iht-busnav14.html) Chiu Wai is pleased with the way the company is operating and feels that Shui is generating just the right level of profit especially because many U.S.-Chinese joint ventures are still operating in red tape. He sees no reason why Rays American bosses shouldnt be more than satisfied with their 5% annual return on investment. This tells me that Chiu is unclear of his companies strategic goals. Without a clear strategy it is impossible to choose right structure and extent of cooperation with a foreign partner. Unfortunately Chiu Wai attitude at Shui Fabrics jeopardizes the success of joint venture investment. As you can see the partners dont share the same vision or philosophy at Shui Fabrics, the joint venture within China and the U.S. The disparity in view points can dramatically hamper performance. In order for them to make the company succeed they need to come up with a clear, shared strategy that they both can agree and understand. Research by the Global Leadership and Organizational Behavior Effectiveness (GLOBE) Project identifies nine dimensions that explain cultural differences which gives managers a better understanding. Below are brief descriptions of the nine dimensions:

1. Power Distance is the extent to which a community accepts and endorses authority, power differences and status privileges. In China, social relationships are formal, hierarchical. People most comfortable in the presence of a hierarchy in which they know their position and the customs/rules for behavior in the situation. The Americans social relationships are informal, egalitarian. People most comfortable with their social equals; importance of social rankings minimized. 2. Uncertainty avoidance is the extent to which a society, organization, or group relies on social norms, rules, and procedures to alleviate the unpredictability of future events. In China, obligation relationships with other people involve reciprocal obligations. In American, obligation people avoid interdependent relationships and situations that might entail long term obligations. 3. Individualism and collectivism Individualism stands for a society in which the ties between individuals are loose and everyone is expected to look after him/herself and his or her immediate family only. Collectivism stands for society in which people from birth onwards are integrated into strong cohesive in-groups, which throughout peoples lifetime continue to protect them in exchange for unquestioning loyalty. The Chinese are collectivist because they place higher value on group cooperation and individual modesty. The Americans are individualism because they place higher value on selfreliance. Self-promotion is more accepted. High value on freedom from externally imposed constraints. 4. Masculinity/femininity indicates the extent to which dominant values in a society tend to be assertive and look more interested in things than in concerning for people and the quality of life. The Chinese are relationship-oriented maintaining a harmonious relationship has priority over accomplishing tasks. Americans have task-oriented relationships that are less important than getting the work done. 5. Assertiveness is the degree to which individuals are assertive, confrontational, and

aggressive in their relationships with others. The Chinese avoid direct confrontation, open criticism, and controversional topics. Concern maintaining harmony and with face. Americans are willing to confront directly, criticize, discuss controversional topics, press personal opinions about what they consider the truth. Little concern with face. 6. Future Orientation is the degree to which a collective encourages and rewards future oriented behaviors such as planning and delaying gratification. The Chinese pay relatively more attention to the past and the longer term future. Americans are less interested in the past they focus on the near-term future 7. Gender differentiation is the degree to which a collective minimized gender inequality. In China, traditionally a persons status in the society was based importantly on inherited characteristics such as age, gender, and family. This is changing. In America, traditionally a persons status in the society was based importantly on inherited characteristics such as age, gender, and family. This is changing. 8. Performance orientation is the extent to which a community encourages innovation, high standards, excellence, and performance improvement. In China, more faith in personal relationships than in written rules and procedures for structuring interactions. In America, written rules presumably apply to, everyone and are assumed to produce fair, reasonable procedures and decisions. 9. Humane orientation is the degree to which and organization or society encourages and rewards individuals for being fair, altruistic, friendly, generous, caring and kind to others. The Chinese have a small number of close, lifelong friends who feel deeply obligated to give each other whatever help might seem required. Americans have a large collections of friends and acquaintances which changes over time and involves only limited mutual obligations. Sources

International Monetary Fund (IMF). World Economic Outlook Database. April 2010 edition. Web. June 14, 2011 <http://www.imf.org/external/pubs/ft/weo/2010/01/weodata/index.aspx> Professor Schwah, Klaus, World Economic Forum Editor. The Global Competitiveness Report 2010-2011. Geneva, Switzerland 2010. World Economic Forum. SRO-Kundig, 2010. Web. June 14 2011. < http://gcr.weforum.org/gcr2010/> NYTimes. The International Herald Tribune. Saving Face in China. December 13, 2010. Web June 15, 2011. <http://www.nytimes.com/2010/12/14/business/global/14ihtbusnav14.html>