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Break Even Analysis. We also studied this topic in my Finance Class. It gave me a better understanding of comparing profit

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What Is a Break-Even Analysis?

Break-even analysis entails the calculation and examination of the margin of safety for an entity based on the revenues collected and associated costs. Analyzing different price levels relating to various levels of demand a business uses break-even analysis to determine what level of sales are necessary to cover the company's total fixed costs. A demand-side analysis would give a seller significant insight regarding selling capabilities.

Key Takeaways

How Break-Even Analysis Works

Break-even analysis is useful in the determination of the level of production or a targeted desired sales mix. The study is for management's use only, as the metric and calculations are not necessary for external sources such as investors, regulators or financial institutions. This type of analysis depends on a calculation of the break-even point (BEP). The break-even point is calculated by dividing the total fixed costs of production by the price of a product per individual unit less the variable costs of production. Fixed costs are those which remain the same regardless of how many units are sold.

Break-even analysis looks at the level of fixed costs relative to the profit earned by each additional unit produced and sold. In general, a company with lower fixed costs will have a lower break-even point of sale. For example, a company with $0 of fixed costs will automatically have broken even upon the sale of the first product assuming variable costs do not exceed sales revenue. However, the accumulation of variable costs will limit the leverage of the company as these expenses come from each item sold.

Special Considerations

Break-even analysis is also used by investors to determine at what price they will break even on a trade or investment. The calculation is useful when trading in or creating a strategy to buy options or a fixed-income security product.

Contribution Margin

The concept of break-even analysis deals with the contribution margin of a product. The contribution margin is the excess between the selling price of the product and total variable costs. For example, if an item sells for $100, the total fixed costs are $25 per unit, and the total variable costs are $60 per unit, the contribution margin of the product is $40 ($100 - $60). This $40 reflects the amount of revenue collected to cover the remaining fixed costs, excluded when figuring the contribution margin.

Calculations For Break-Even Analysis

The calculation of break-even analysis may use two equations. In the first calculation, divide the total fixed costs by the unit contribution margin. In the example above, assume the value of the entire fixed costs is $20,000. With a contribution margin of $40, the break-even point is 500 units ($20,000 divided by $40). Upon the sale of 500 units, the payment of all fixed costs are complete, and the company will report a net profit or loss of $0.

Alternatively, the calculation for a break-even point in sales dollars happens by dividing the total fixed costs by the contribution margin ratio. The contribution margin ratio is the contribution margin per unit divided by the sale price. Returning to the example above the contribution margin ratio is 40% ($40 contribution margin per item divided by $100 sale price per item). Therefore, the break-even point in sales dollars is $50,000 ($20,000 total fixed costs divided by 40%). Confirm this figured by multiplying the break-even in units (500) by the sale price ($100) which equals $50,000.

Real-World Example

Break-even analysis is not only used by businesses. Suppose an options trader buys a 50- strike call for $1.00 premium when the underlying is trading at $46. A break-even analysis will show that the price of the underlying must reach $51 before they break-even on the trade. While the call will be in-the-money (ITM) at any price trading above $50, the trader will still need to recoup the option premium of $1 which they originally paid to buy the option. (For related reading, see " How Can I Calculate Break-Even Analysis in Excel?")

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Break-even analysis entails the calculation and examination of the margin of safety for an entity based on the revenues collected and associated costs. Analyzing different price levels relating to various levels of demand a business uses break-even analysis to determine what level of sales are necessary to cover the company's total fixed costs.

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Productivity is probably one of the most important topics in business.

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. / Credit: Productivity Image via Shutterstock

Between constant meetings, phone calls and emails, staying productive at work can be a challenge. However, the odds of staying productive can be greatly improved by taking some simple steps to lighten your workload.

Adam Gurian, president of Timex offers the following tips for workers to make the most of their time at work.

Act immediately on phone messages - If you can accomplish a task in just a few minutes, do it. It is one less thing on your to do list and you will have that immediate sense of accomplishment. If you let too many small activities pile up, you will be playing catch up the rest of the day.

Get a head-start on tomorrow by preparing before you leave the office today - The simple task of writing a to-do list is one of the most efficient ways of keeping track of your daily work requirements. By writing out a list for tomorrow before you leave the office at night, you will have an immediate head-start on your next day and be ready for your new priorities.

Don't sit at your desk all day - It is important to get up, walk around the office and take a few minutes for a 'mental break.' These short breaks will reinvigorate you and help you be more productive in the long term.

Organize your tasks - By arranging your workday so that you tackle your most important priorities together, you will save time, be more efficient and ultimately produce higher quality work. In addition, by starting your day with the most important task, you will increase your productivity and get your day off to a good start.

Stand up for your phone calls - It is amazing that the simple act of standing during a phone call will actually help shorten the call, thus saving you time. If you are standing you are less likely to be involved in idle chatting and you will get to the point of the conversation faster.

Stick to a schedule - If a meeting is scheduled for an hour, do everything possible to keep it to an hour. Once meetings start running long, it directly impacts the rest of your schedule for the day, while also impacting your co-workers. A series of meetings that run long will have a snowball effect throughout the day. Also, if you are not required to be at a meeting and you have a more pressing deadline, do not feel guilty about missing the meeting.

Learn to say no - While everyone wants to be a good team player at work, saying no is sometimes the right thing to do. If you are not the best person for an activity, or if you have other pending deadlines, it is OK to turn down a project. However, it is always beneficial to have an alternate solution or suggestion, so that your co-workers have a clear vision of what they will need to do to help move their projects forward.

Don't let email take over your day - We are all so accustomed to email that as soon as we see a new email in our inbox we instinctively click it on, respond and focus on the content of the email. These seemingly tiny activities during the day can quickly add up to large amounts of time that not only cause your day to slip away but also distract you from completing your current task. If you are focused on a project, tell yourself that you will not check your email for a set amount of time, so that you get through your activity.

Don't take advantage of Facebook in the office - Social media is a part of all of our daily lives. However, to save time you must have the discipline to not spend large parts of your day seeing what your friends thought of the latest movie release or what they had for dinner last night. Many companies are moving towards banning Facebook in the office, as it is becoming a drain on the workday. If you are allowed on Facebook during the day, be sure to use it as a 'break' for just a few minutes, because if it becomes a regular habit, it can easily take over your day and impact the work needed to get done.

Use Technology - There are amazing tools that you can use in the office to make you more productive and ultimately save time during the workday. Use GoogleDocs to collaborate with colleagues on documents. Use calendar planning tools to sync up your schedules with colleagues. Use Skype for video conferencing so that you can potentially reduce the need to travel for meetings. Also, work with your IT team to see if they have suggestions on which new technologies can be used to save time. They can be a tremendous resource not only to you but to the entire organization.

Follow David Mielach on Twitter @D_M89 or BusinessNewsDaily @bndarticles. We're also on Facebook & Google+.

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Between constant meetings, phone calls and emails, staying productive at work can be a challenge. However, the odds of staying productive can be greatly improved by taking some simple steps to lighten your workload. Adam Gurian, president of Timex offers the following tips for workers to make the most of their time at work.

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Chapter 17 talks about the security of information systems. This article gives some basic information on the subject. We just did training in our building concerning this.

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What is Information Systems Security (INFOSEC)? - Definition from Techopedia

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Information Systems Security INFOSEC Definition - Information systems security, more commonly referred to as INFOSEC, refers to the processes and...

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This is probably our biggest area of opportunity in the workplace.

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This gave some great information about motivating employees.

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Figure 1.

Introduction

Motivation is an important tool that is often under-utilized by managers in today's workplace. Managers use motivation in the workplace to inspire people to work, both individually and in groups, to produce the best results for business in the most efficient and effective manner. It was once assumed that motivation had to be generated from the outside, but it is now understood that each individual has his or her own set of motivating forces. It is the duty of the manager to carefully identify and address these motivating forces. The aim of this article is to help managers become more effective at creating a positive motivational environment.

Managers may lack knowledge in implementing successful motivational programs that increase production and create a positive work environment. Although there are many types of motivation, management must identify with their associates (employees) on an individual level for successful programs. The goal of every manager is to increase production and efficiency to reach maximum results for the organization. Motivation for better work performance depends on many factors, including: job satisfaction, achievement, recognition, and professional growth (SHRM 2016). Providing a positive motivational work environment is a challenging managerial activity. Therefore managers must understand associates and their professional needs.

Identifying Motivating Factors

The manager must identify what actually motivates associates. People tend to do their best work when they are in an environment that makes them feel valued, where they get a "pat on the back" or a "thank you" for a job well done. These courtesies may seem simple, but managers sometimes forget to utilize them. Managers can do simple things that can have a great impact on organizational morale to motivate associates to "go the extra mile." It is important to create a welcoming work environment to motivate associates. Managers sometimes forget the power of the simple courtesies that go a long way in improving the work environment.

There are several factors managers should keep in mind when considering how to recognize and reward associates. Managers should not assume that people feel valued just because they are productive, nor that what works for the manager in terms of recognition and reward will work for others. The "platinum rule" of "treating others the way that they want to be treated" increases a manager's ability to creat rapport with associates as an important motivational tool.

Motivation

A study by Kovach (1999) compared associates' rankings of what they most wanted from their jobs with what management thought associates wanted most. The results of the study were somewhat surprising. While management thought associates would list "good wages" as most important, "interesting work" was ranked most important, by associates

Motivating people can be challenging because associates are individuals, meaning that what works for one may not work for another. Managers must be able to communicate with associates. According to Kovach (1999), managers sometimes disregard the most important motivational techniques when dealing with associates. While monetary incentives are important, sometimes non-monetary incentives are the better choice. Kovach's survey provides good ideas for motivational opportunities.

Two key managerial points emerge from Kovach's work. First, non-monetary incentives for associates often can be easily addressed by their supervisors and are relatively inexpensive to implement (Table 1). This is in sharp contrast to wages, job security, and promotion, which are usually under the control of top-level managers. Second, it is important for managers to consider career development incentives for associates when thinking about rewards and recognition.

Other Factors

Another easily overlooked and important factor is attitude. If a supervisor or team leader approaches the workplace with a positive, upbeat attitude about work projects, that enthusiasm should transfer to associates, thus creating a better work environment for all. Managers who are serious about maintaining a productive work environment and motivating associates to do their best need to talk with the associates to find out what is important to them (Nicholson 2003). Some associates prefer public recognition, while others prefer private recognition. Public recognition can involve associate meetings, department newsletters, trophy presentations, or gifts of flowers at the office. According to the global employment website Monster.com, private recognition can be kept low-cost and simple, such as a gift certificate or gift appropriate to the associate's specific interests, acknowledging accomplishment in a written evaluation or a thank-you note, gifts of flowers delivered to associates' homes, or initiatives such as preferred parking, flex time, or wellness benefits (Matuson 2019).

Understanding Associates' Needs

When trying to understand associates, managers must consider the fact that the career status of associates will vary. Associates nearing the end of their careers might appreciate being given mentoring responsibilities or more control of their work environment, while associates beginning their careers might appreciate flexible scheduling options and professional development opportunities. According to Kovac (1999), managers should ask themselves the following questions when attempting to provide a more positive motivational climate for associates:

Do you personally thank associates for a job well done?

Is your feedback timely and specific?

Do you make time to discuss associates' jobs on a regular basis?

Is your workplace open, trusting, and fun?

Do you encourage and reward initiative and new ideas?

Do you share company information with associates on a regular basis?

Do you involve associates in decisions, especially those that will affect them?

Do you provide associates with a sense of ownership of their jobs?

Do you give associates the chance to succeed?

* Do you reward associates based on their work performance?

Conclusions

Motivation can be properly or improperly achieved and can either hinder or improve productivity. Management must understand that they are dealing with human beings, not machines, and that motivation involves incentivizing people to do something because they want to do it. Effective motivation cannot be achieved without knowing what is important to associates. Management must use the proper incentives to achieve the desired results. Simply stated, if the proper motivational environment is in place, managers will be rewarded with productive associates.

References

Nicholson, N. 2003. How to motivate your problem people. Harvard Business Review 81(1) pp. 56-65. Retrieved from Business Source Premier database.

Kovach, K. 1999. Employee motivation: Addressing a crucial factor in your organization's performance. Human Resource Development. Ann Arbor, MI: University of Michigan Press.

Matuson, R. 2019. How to motivate employees? Try these low-cost perks. Monster.com / Workforce Management & Planning/ Employee Performance https://hiring.monster.com/employer-resources/workforce-management/employee-performance/how-to-motivate-employees-us/

SHRM. 2016. Employee job satisfaction and engagement: Revitalizing a changing workforce. Society for Human Resource Management https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/2016-Employee-Job-Satisfaction-and-Engagement-Report.pdf

Tables

Table 1.

Associate movtivation survey results

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Ian Bessell, Brad Dicks, Allen Wysocki, Karl Kepner, Derek Farnsworth, and Jennifer L. Clark

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HR017/HR017: Understanding Motivation: An Effective Tool for Managers

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Figure 1. Motivation is an important tool that is often under-utilized by managers in today's workplace. Managers use motivation in the workplace to inspire people to work, both individually and in groups, to produce the best results for business in the most efficient and effective manner.

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Maslow's Hierarchy of Needs gave great insight on the needs of human beings. I am trying to use this to implement changes in my workplace on how we handle employees

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Key Takeaways

Maslow's hierarchy of needs is a motivational theory in psychology comprising a five-tier model of human needs, often depicted as hierarchical levels within a pyramid.

The five levels of the hierarchy are physiological, safety, love/belonging, esteem, and self-actualization.

Lower-level basic needs like food, water, and safety must be met first before higher needs can be fulfilled.

Few people are believed to reach the level of self-actualization, but we can all have moments of peak experiences.

The order of the levels is not completely fixed. For some, esteem outweighs love, while others may self-actualize despite poverty. Our behaviors are usually motivated by multiple needs simultaneously.

Applications include workplace motivation, education, counseling, and nursing.

What is Maslow's Hierarchy of Needs?

According to Maslow (1943, 1954), human needs were arranged in a hierarchy, with physiological (survival) needs at the bottom, and the more creative and intellectually oriented 'self-actualization' needs at the top.

Maslow argued that survival needs must be satisfied before the individual can satisfy the higher needs. The higher up the hierarchy, the more difficult it is to satisfy the needs associated with that stage, because of the interpersonal and environmental barriers that inevitably frustrate us.

Higher needs become increasingly psychological and long-term rather than physiological and short-term, as in the lower survival-related needs.

1. Physiological needs are biological requirements for human survival, e.g., air, food, drink, shelter, clothing, warmth, sex, and sleep.

Our most basic need is for physical survival, and this will be the first thing that motivates our behavior. Once that level is fulfilled, the next level up is what motivates us, and so on.

The human body cannot function optimally if physiological needs are not satisfied. Maslow considered physiological needs the most important as all the other needs become secondary until these needs are met.

Once an individual's physiological needs are satisfied, the need for security and safety becomes salient.

2. Safety needs - people want to experience order, predictability, and control in their lives.

Safety needs can be fulfilled by the family and society (e.g., police, schools, business, and medical care).

For example, emotional security, financial security (e.g., employment, social welfare), law and order, freedom from fear, social stability, property, health, and wellbeing (e.g., safety against accidents and injury).

After physiological and safety needs have been fulfilled, the third level of human needs is social and involves feelings of belongingness.

3. Love and belongingness needs refers to a human emotional need for interpersonal relationships, affiliating, connectedness, and being part of a group.

Examples of belongingness needs include friendship, intimacy, trust, acceptance, receiving and giving affection, and love.

This need is especially strong in childhood and can override the need for safety, as witnessed in children who cling to abusive parents.

4. Esteem needs are the fourth level in Maslow's hierarchy and include self-worth, accomplishment, and respect.

Maslow classified esteem needs into two categories: (i) esteem for oneself (dignity, achievement, mastery, independence) and (ii) the desire for reputation or respect from others (e.g., status, prestige).

Esteem presents the typical human desire to be accepted and valued by others. People often engage in a profession or hobby to gain recognition. These activities give the person a sense of contribution or value.

Low self-esteem or an inferiority complex may result from imbalances during this level in the hierarchy.

Maslow indicated that the need for respect or reputation is most important for children and adolescents and precedes real self-esteem or dignity.

5. Self-actualization needs are the highest level in Maslow's hierarchy, and refer to the realization of a person's potential, self-fulfillment, seeking personal growth, and peak experiences.

This level of need refers to what a person's full potential is and the realization of that potential.

Maslow (1943, 1987, p. 64) describes this level as the desire to accomplish everything that one can, and "to become everything one is capable of becoming".

Individuals may perceive or focus on this need very specifically. For example, one individual may have a strong desire to become an ideal parent.

In another, the desire may be expressed athletically. For others, it may be expressed in paintings, pictures, or inventions.

Although Maslow did not believe that many of us could achieve true self-actualization, he did believe that all of us experience transitory moments (known as 'peak experiences') of self-actualization.

Such moments, associated with personally significant events such as childbirth, sporting achievement and examination success), are difficult to achieve and maintain consistently.

Maslow posited that human needs are arranged in a hierarchy:

"It is quite true that man lives by bread alone - when there is no bread. But what happens to man's desires when there is plenty of bread and when his belly is chronically filled?

At once other (and "higher") needs emerge and these, rather than physiological hungers, dominate the organism. And when these in turn are satisfied, again new (and still "higher") needs emerge and so on. This is what we mean by saying that the basic human needs are organized into a hierarchy of relative prepotency" (Maslow, 1943, p. 375) .

Key Point: Keep in mind that Maslow's hierarchy of needs doesn't follow a strict linear progression. Individuals can feel various needs at the same time or shift between levels.

Maslow continued to refine his theory based on the concept of a hierarchy of needs over several decades (Maslow, 1943, 1962, 1987).

Regarding the structure of his hierarchy, Maslow (1987) proposed that the order in the hierarchy "is not nearly as rigid" (p. 68) as he may have implied in his earlier description.

Maslow noted that the order of needs might be flexible based on external circumstances or individual differences. For example, he notes that for some individuals, the need for self-esteem is more important than the need for love. For others, the need for creative fulfillment may supersede even the most basic needs.

Maslow (1987) also pointed out that most behavior is multi-motivated and noted that "any behavior tends to be determined by several or all of the basic needs simultaneously rather than by only one of them" (p. 71).

Maslow (1954) proposed that human beings possess two sets of needs. This five-stage model can be divided into deficiency needs and growth needs. The first four levels are often referred to as deficiency needs ( D-needs ), and the top level is known as growth or being needs ( B-needs ).

Deficiency needs

Deficiency needs are concerned with basic survival and include physiological needs (such as the need for food, sex, and sleep) and safety needs (such as the need for security and freedom from danger).

Behaviors associated with these needs are seen as 'deficiency' motivated, as they are a means to an end.

Deficiency needs arise due to deprivation and are said to motivate people when they are unmet. Also, the motivation to fulfill such needs will become stronger the longer they are denied. For example, the longer a person goes without food, the more hungry they will become.

Maslow (1943) initially stated that individuals must satisfy lower-level deficit needs before progressing to meet higher-level growth needs.

However, he later clarified that satisfaction of a need is not an "all-or-none" phenomenon, admitting that his earlier statements may have given "the false impression that a need must be satisfied 100 percent before the next need emerges" (1987, p. 69).

When a deficit need has been "more or less" satisfied, it will go away, and our activities become habitually directed toward meeting the next set of needs we have yet to satisfy. These then become our salient needs. However, growth needs continue to be felt and may even become stronger once engaged.

Growth needs

Growth needs are more psychological and are associated with realizing an individual's full potential and needing to 'self-actualize'. These needs are achieved more through intellectual and creative behaviors.

Growth needs do not stem from a lack of something but rather from a desire to grow as a person. Once these growth needs have been reasonably satisfied, one may be able to reach the highest level, called self-actualization. Growth needs are achieved more through intellectual and creative behaviors.

Every person is capable and has the desire to move up the hierarchy toward a level of self-actualization. Unfortunately, progress is often disrupted by a failure to meet lower-level needs.

Life experiences, including divorce and the loss of a job, may cause an individual to fluctuate between levels of the hierarchy.

Therefore, not everyone will move through the hierarchy in a uni-directional manner but may move back and forth between the different types of needs.

The expanded hierarchy of needs

It is important to note that Maslow's (1943, 1954) five-stage model has been expanded to include cognitive and aesthetic needs (Maslow, 1970a) and later transcendence needs (Maslow, 1970b).

Changes to the original five-stage model are highlighted and include a seven-stage model and an eight-stage model; both developed during the 1960s and 1970s.

1. Biological and physiological needs - air, food, drink, shelter, warmth, sex, sleep, etc.

2. Safety needs - protection from elements, security, order, law, stability, freedom from fear.

3. Love and belongingness needs - friendship, intimacy, trust, and acceptance, receiving and giving affection and love. Affiliating, being part of a group (family, friends, work).

4. Esteem needs - which Maslow classified into two categories: (i) esteem for oneself (dignity, achievement, mastery, independence) and (ii) the need to be accepted and valued by others (e.g., status, prestige).

5. Cognitive needs - knowledge and understanding, curiosity, exploration, need for meaning and predictability.

Cognitive needs drive our pursuit of knowledge and understanding. For instance, a student's desire to understand complex mathematical theories, a traveler's curiosity about diverse cultures, or an individual's quest for life's deeper meanings all exemplify these needs.

Meeting these needs facilitates personal growth, comprehension, and a deeper understanding of life and its complexities.

6. Aesthetic needs - appreciation and search for beauty, balance, form, etc. Fulfilling these needs leads to a deeper sense of satisfaction and harmony in life, as individuals seek environments and experiences that are pleasing and resonant with their sense of beauty.

This involves the appreciation and pursuit of art, music, nature, and other forms of aesthetic expression.

Fulfilling these needs isn't just about physical beauty but also the emotional and psychological satisfaction derived from experiencing order and elegance.

7. Self-actualization needs - realizing personal potential, self-fulfillment, seeking personal growth, and peak experiences.

8. Transcendence needs - A person is motivated by values that transcend beyond the personal self. Beyond self-actualization, they represent the human desire to connect with a higher reality, purpose, or the universe.

This level emphasizes altruism, spiritual connection, and helping others achieve their potential.

Individuals seek experiences that move beyond personal concerns, aiming to achieve a deep sense of unity, understanding, and belonging within the vast expanse of existence.

Examples of transcendence needs include mystical experiences and certain experiences with nature, aesthetic experiences, sexual experiences, service to others, the pursuit of science, religious faith, etc.).

Self-Actualization Needs

Instead of focusing on psychopathology and what goes wrong with people, Maslow (1943) formulated a more positive account of human behavior which focused on what goes right. He was interested in human potential, and how we fulfill that potential.

Psychologist Abraham Maslow (1943, 1954) stated that human motivation is based on people seeking fulfillment and change through personal growth. Self-actualized people are those who are fulfilled and doing all they are capable of.

The growth of self-actualization (Maslow, 1962) refers to the need for personal growth and discovery that is present throughout a person's life. For Maslow, a person is always "becoming" and never remains static in these terms. In self-actualization, a person comes to find a meaning in life that is important to them.

As each individual is unique, the motivation for self-actualization leads people in different directions (Kenrick et al., 2010). For some people, self-actualization can be achieved through creating works of art or literature; for others, through sports, in the classroom, or within a corporate setting.

Maslow (1962) believed self-actualization could be measured through the concept of peak experiences. This occurs when a person experiences the world totally for what it is, and there are feelings of euphoria, joy, and wonder.

It is important to note that self-actualization is a continual process of becoming rather than a perfect state one reaches of a "happy ever after" (Hoffman, 1988).

Maslow offers the following description of self-actualization:

"It refers to the person's desire for self-fulfillment, namely, to the tendency for him to become actualized in what he is potentially.

The specific form that these needs will take will of course vary greatly from person to person. In one individual it may take the form of the desire to be an ideal mother, in another it may be expressed athletically, and in still another it may be expressed in painting pictures or in inventions" (Maslow, 1943, p. 382-383).

Characteristics of Self-Actualized People

Although we are all, theoretically, capable of self-actualizing, most of us will not do so, or only to a limited degree. Maslow (1970) estimated that only two percent of people would reach the state of self-actualization.

He was especially interested in the characteristics of people whom he considered to have achieved their potential as individuals.

By studying 18 people, he considered to be self-actualized (including Abraham Lincoln and Albert Einstein), Maslow (1970) identified 15 characteristics of a self-actualized person.

Characteristics of self-actualizers:

1. They perceive reality efficiently and can tolerate uncertainty;

2. Accept themselves and others for what they are;

3. Spontaneous in thought and action;

4. Problem-centered (not self-centered);

5. Unusual sense of humor;

6. Able to look at life objectively;

7. Highly creative;

8. Resistant to enculturation, but not purposely unconventional;

9. Concerned for the welfare of humanity;

10. Capable of deep appreciation of basic life-experience;

11. Establish deep satisfying interpersonal relationships with a few people;

12. Peak experiences;

13. Need for privacy;

14. Democratic attitudes;

15. Strong moral/ethical standards.

Behavior leading to self-actualization:

1. Experiencing life like a child, with full absorption and concentration;

2. Trying new things instead of sticking to safe paths;

3. Listening to your own feelings in evaluating experiences instead of the voice of tradition, authority or the majority;

4. Avoiding pretense ("game playing") and being honest;

5. Being prepared to be unpopular if your views do not coincide with those of the majority;

6. Taking responsibility and working hard;

7. Trying to identify your defenses and having the courage to give them up.

The characteristics of self-actualizers and the behaviors leading to self-actualization are shown in the list above.

Although people achieve self-actualization in their own unique way, they tend to share certain characteristics. However, self-actualization is a matter of degree, 'There are no perfect human beings' (Maslow, 1970a, p. 176).

It is not necessary to display all 15 characteristics to become self-actualized, and not only self-actualized people will display them.

Maslow did not equate self-actualization with perfection. Self-actualization merely involves achieving one's potential. Thus, someone can be silly, wasteful, vain and impolite, and still self-actualize. Less than two percent of the population achieve self-actualization.

Applications & Examples

Workplace organizations and employee motivation

The theory applies to organizational structures and the motivation of employees. To enhance performance, the organizational culture and HR strategies must address and fulfill the needs of employees.

HR strategies, including compensation, benefits, job design, training, cultural development, and performance evaluations, can be tailored to cater to Maslow's hierarchy of needs (Jerome, 2013).

1. What can managers do to motivate employees with physiological needs?

At the foundational physiological level, organizations should provide wages that sustain a decent standard of living and comprehensive benefits, ensuring employees can comfortably cater to necessities such as food, shelter, and medical care.

Offer comprehensive healthcare benefits - Quality health insurance, dental, vision, mental health coverage, and wellness programs demonstrate you care about employees' overall health and ability to afford care.

Subsidize gym memberships - Some companies offer monthly gym subsidies or onsite fitness centers to support physical health and stress management.

Make the space ergonomic - Ensure workstations, chairs, keyboards, etc. are height adjustable and comfortable to work at for extended periods to prevent bodily strain or injury.

Pay for wellness services - Some companies offer perks like free annual flu shots, smoking cessation programs, or biometric screenings to proactively address health.

2. What can managers do to motivate employees with safety needs?

For the safety tier, offering job stability, secure working conditions, and equitable compensation is essential. Employees are more motivated when they feel both financially stable and physically safe within their workplace.

Establish anti-harassment policies and reporting procedures - Ensure strong systems are in place for reporting issues confidentially and without retaliation.

Cultivate psychological safety - Foster an environment where people feel safe to take risks, make mistakes, and speak up without fear of embarrassment or punishment.

Define and reinforce ethical standards - Clearly establish and model expected conduct to prevent ethical lapses that undermine security.

Promote transparency in pay and promotion practices - Clearly communicate compensation structure, advancement criteria, and salary negotiation options to build trust.

3. What can managers do to motivate employees with social needs?

Addressing social needs involves cultivating an inclusive community within the organization. Team-building exercises, social gatherings, mentorship initiatives, and transparent communication can foster a sense of belonging. Motivation is heightened when employees feel appreciated and integrated within their teams.

Develop mother's rooms - Providing clean, private lactation rooms supports new mothers' needs to pump breast milk during work hours.

Train supervisors in mental health first aid - Equip leaders to recognize signs of depression, anxiety, substance abuse and properly intervene or connect employees with help.

Develop a mentorship program - Allow experienced employees to mentor newer ones to establish interpersonal bonds and a sense of support.

Model inclusive language and behavior - Use words and actions that are welcoming and respectful to all groups.

Share vulnerability and imperfections - Leaders should open up on mistakes, challenges, and lessons learned to humanize the workplace.

4. What can managers do to motivate employees with esteem needs?

To cater to esteem needs, organizations should implement recognition systems, merit-based promotions, and leadership roles.

Leverage unique talents - Properly designated titles that reflect an individual's role and status can also be beneficial.

Make the most of performance reviews - Regular performance evaluations not only offer recognition but also highlight areas for growth, feeding into the employees' need for esteem. Thoroughly highlight strengths, progress made, and areas of influence.

Entrust employees with mentoring roles - Having them share knowledge and coach others recognizes their expertise.

What can managers do to motivate employees with self-actualization needs?

For self-actualization, organizations should ensure that job roles align with employees' talents and passions. By empowering employees, presenting them with challenges, and fostering an environment that encourages innovation, organizations can facilitate their journey toward self-actualization.

Foster innovation - Dedicate time and resources for experimenting with new ideas without pressure.

Sponsor continuing education - Provide tuition reimbursement or subsidies for advanced courses and certificate programs. Offer paid time for relevant reading, online courses, conferences, and seminars.

The hierarchy provides a framework for understanding patients as multifaceted human beings.

Patient care should be holistic, not just medical. Nurses must assess and address the spectrum of patient needs - physical, mental, emotional, and social (Jackson et al., 2014; Toney-Butler & Thayer, 2023). Doing so motivates greater engagement in care, faster healing, and improved outcomes.

1. Physiological needs - Ensure patients have adequate nutrition, hydration, pain control, sleep, and physical comfort. Address pain that hinders sleep and recovery.

2. Safety needs - Maintain a clean, quiet environment with call bells for assistance. Prevent injuries through fall precautions, blood clot prevention, and pressure ulcer avoidance.
Explain tests, treatments, and medications to patients to relieve anxiety. Keep patient info confidential. Foster a climate of trust through compassionate listening. Prevent medication errors.

3. Belongingness - Loneliness impedes healing. Make patients feel welcomed and included. Introduce them to other patients. Allow for family visitation and spiritual practices.

4. Esteem - Show respect through courteous communication and cultural sensitivity. Maintain dignity and privacy. Empower patients in care decisions. Explain care in an easy-to-understand way. Listen attentively to their concerns. Make them feel valued.

5. Self-actualization - Align care with patient values and aspirations. Perhaps share motivational stories of those with similar diagnoses who stayed active. Or provide resources on coping with grief over health changes.

Maslow's (1962) hierarchy of needs theory has made a major contribution to teaching and classroom management in schools. Rather than reducing behavior to a response in the environment, Maslow (1970a) adopts a holistic approach to education and learning.

Maslow looks at the complete physical, emotional, social, and intellectual qualities of an individual and how they impact learning.

Applications of Maslow's hierarchy theory to the work of the classroom teacher are obvious. Before a student's cognitive needs can be met, they must first fulfill their basic physiological needs.

For example, a tired and hungry student will find it difficult to focus on learning. Students need to feel emotionally and physically safe and accepted within the classroom to progress and reach their full potential.

Maslow suggests students must be shown that they are valued and respected in the classroom, and the teacher should create a supportive environment. Students with a low self-esteem will not progress academically at an optimum rate until their self-esteem is strengthened.

Maslow's hierarchy provides a humanistic lens for teaching the whole child.

Maslow (1971, p. 195) argued that a humanistic educational approach would develop people who are "stronger, healthier, and would take their own lives into their hands to a greater extent. With increased personal responsibility for one's personal life, and with a rational set of values to guide one's choosing, people would begin to actively change the society in which they lived".

Here are some ways a teacher can apply Maslow's hierarchy of needs in the classroom:

1. Physiological - Ensure students have access to water, food, restroom breaks, and movement. Allow snacks, flexible seating, and adequate breaks.

2. Safety - Maintain an orderly classroom with clear expectations. Prevent bullying. Build trust through consistency and fairness. Allow students to make mistakes safely.

3. Belongingness - Facilitate community and collaboration. Foster teamwork through group projects. Learn student names and backgrounds. Appreciate diversity.

4. Esteem - Recognize student strengths and progress. Display student work. Empower leadership roles like line leader or tech helper. Praise efforts, not just achievement.

5. Self-Actualization - Help students pursue interests creatively. Assign passion projects. Encourage goal-setting. Provide enrichment opportunities. Support challenging oneself.

When these foundational needs are met, students are more motivated to learn and perform well academically. But needs fluctuate. Be observant and nurture needs as they arise.

Critical Evaluation

The most significant limitation of Maslow's theory concerns his methodology. Maslow formulated the characteristics of self-actualized individuals by undertaking a qualitative method called biographical analysis.

He looked at the biographies and writings of 18 people he identified as being self-actualized. From these sources, he developed a list of qualities that seemed characteristic of this specific group of people, as opposed to humanity in general.

From a scientific perspective, there are numerous problems with this particular approach. First, it could be argued that biographical analysis as a method is extremely subjective as it is based entirely on the opinion of the researcher. Personal opinion is always prone to bias, which reduces the validity of any data obtained. Therefore Maslow's operational definition of self-actualization must not be blindly accepted as scientific fact.

Furthermore, Maslow's biographical analysis focused on a biased sample of self-actualized individuals, prominently limited to highly educated white males (such as Thomas Jefferson, Abraham Lincoln, Albert Einstein, William James, Aldous Huxley, Beethoven).

Although Maslow (1970) did study self-actualized females, such as Eleanor Roosevelt and Mother Teresa, they comprised a small proportion of his sample. This makes it difficult to generalize his theory to females and individuals from lower social classes or different ethnicity. Thus questioning the population validity of Maslow's findings.

Furthermore, it is extremely difficult to empirically test Maslow's concept of self-actualization in a way that causal relationships can be established. It is difficult to tell in Maslow's theory where the scientific leaves off and the inspiration begins. His theory is seen as more speculative than empirically proven, with a tendency to substitute rhetoric for research.

Another criticism concerns Maslow's assumption that the lower needs must be satisfied before a person can achieve their potential and self-actualize. This is not always the case, and therefore Maslow's hierarchy of needs in some aspects has been falsified.

Through examining cultures in which large numbers of people live in poverty (such as India), it is clear that people are still capable of higher-order needs such as love and belongingness. However, this should not occur, as according to Maslow, people who have difficulty achieving very basic physiological needs (such as food, shelter, etc.) are not capable of meeting higher growth needs.

Also, many creative people, such as authors and artists (e.g., Rembrandt and Van Gogh) lived in poverty throughout their lifetime, yet it could be argued that they achieved self-actualization.

Psychologists now conceptualize motivation as a pluralistic behavior, whereby needs can operate on many levels simultaneously. A person may be motivated by higher growth needs at the same time as lower-level deficiency needs (Wahba & Bridwell, 1973).

Contemporary research by Tay and Diener (2011) has tested Maslow's theory by analyzing the data of 60,865 participants from 123 countries, representing every major region of the world. The survey was conducted from 2005 to 2010.

Respondents answered questions about six needs that closely resemble those in Maslow's model: basic needs (food, shelter); safety; social needs (love, support); respect; mastery; and autonomy.

They also rated their well-being across three discrete measures: life evaluation (a person's view of his or her life as a whole), positive feelings (day-to-day instances of joy or pleasure), and negative feelings (everyday experiences of sorrow, anger, or stress).

The results of the study support the view that universal human needs appear to exist regardless of cultural differences. However, the ordering of the needs within the hierarchy was not correct.

"Although the most basic needs might get the most attention when you don"t have them," Diener explains, "you don"t need to fulfill them in order to get benefits [from the others]."

Even when we are hungry, for instance, we can be happy with our friends. "They"re like vitamins," Diener says about how the needs work independently. "We need them all."

Conclusion

Maslow's theory differs from more purely physiological representations of human motivation because motivation is seen as being not just concerned with tension reduction and survival but also with human growth and development.

While Maslow's work was indeed relatively informal and clinically descriptive, it did provide a rich source of ideas, and as such, a framework for discussing the richness and complexity of human motivation that goes beyond homeostatic models and other biological models.

Frequently Asked Questions

What are some of the weaknesses of Maslow's theory?

How many levels are there in Maslow's pyramid of needs?

Why is Maslow's hierarchy of needs important?

What is at the top of Maslow's hierarchy of needs?

References

Geller, L. (1982). The failure of self-actualization theory: A critique of Carl Rogers and Abraham
Maslow. Journal of Humanistic Psychology, 22, 56-73.

Hoffman, E. (1988). The right to be human: A biography of Abraham Maslow. Los Angeles, CA: Jeremy P. Tarcher.

Ivtzan, I. (2008). Self actualisation: For individualistic cultures only? International Journal on
Humanistic Ideology, 1, 113-140.

Jackson, J. C., Santoro, M. J., Ely, T. M., Boehm, L., Kiehl, A. L., Anderson, L. S., & Ely, E. W. (2014). Improving patient care through the prism of psychology: Application of Maslow's hierarchy to sedation, delirium, and early mobility in the intensive care unit. Journal of Critical Care, 29(3), 438-444.

Jerome, N. (2013). Application of the Maslow's hierarchy of need theory; impacts and implications on organizational culture, human resource and employee's performance. International Journal of Business and Management Invention, 2(3), 39-45.

Kenrick, D. T., Neuberg, S. L., Griskevicius, V., Becker, D. V., & Schaller, M. (2010). Goal-driven cognition and functional behavior: The fundamental-motives framework. Current Directions in Psychological Science, 19 (1), 63-67.

King-Hill, S. (2015). Critical analysis of Maslow's hierarchy of need. The STeP Journal (Student Teacher Perspectives), 2(4), 54-57.

Maslow, A. H. (1943). A theory of human motivation. Psychological Review, 50 (4), 370-96.

Maslow, A. H. (1954). Motivation and personality. New York: Harper and Row.

Maslow, A. H. (1962). Toward a psychology of being. Princeton: D. Van Nostrand Company.

Maslow, A. H. (1970a). Motivation and personality. New York: Harper & Row.

Maslow, A. H. (1970b). Religions, values, and peak experiences. New York: Penguin. (Original work published 1966)

Maslow, A. H. (1987). Motivation and personality (3rd ed.). Delhi, India: Pearson Education.

Mittelman, W. (1991). Maslow's study of self-actualization: A reinterpretation. Journal of Humanistic Psychology, 31(1), 114-135.

Neher, A. (1991). Maslow's theory of motivation: A critique. Journal of Humanistic Psychology,
31, 89-112.

Tay, L., & Diener, E. (2011). Needs and subjective well-being around the world. Journal of Personality and Social Psychology, 101 (2), 354-356.

Toney-Butler, T.J., & Thayer, J.M. (2023, April 10). Nursing Process. In StatPearls. StatPearls Publishing. https://www.ncbi.nlm.nih.gov/books/NBK499937/

Wahba, M. A., & Bridwell, L. G. (1976). Maslow reconsidered: A review of research on the need hierarchy theory. Organizational Behavior and Human Performance, 15 (2), 212-240.

Wulff, D. M., & Maslow, A. H. (1965). Religions, values, and peak-experiences. The Journal of Higher Education, 36 (4), 235.

Further Information

Hierarchy of Needs and Nursing

Hierarchy of Needs in the Workplace

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Maslow's hierarchy of needs is a pyramid of the needs that motivate people. Individuals most basic needs, at the base of the pyramid, are physiological. Once they have fulfilled these needs, people move on to their safety needs, social well-being, self-esteem then ultimately their need for self-actualization.

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I am extremely big on finding new ways to motivate employees. These theories concerning motivation gave me some wonderful ideas

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The examples used in the textbook about the Life Cycle of Leadership were very descriptive and helped me understand the concept. This chart shows the basics of that Theory.

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the life cycle theory of leadership - Bing images

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Situational Theory Life-Cycle Hypothesis Economic Life Cycle HR Employee Life Cycle Organizational Life Cycle Crisis Life Cycle Product Life Cycle Theory Life Cycle Model Employee Life Cycle Graphic Management Cycle Employee Work Life Cycle Project Management Life Cycle Model Business Life Cycle Employee Life Cycle Diagram Employee Life Cycle Stages

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Module Seven
Differences between leaders and managers. I would like to be seen as more of a leader in my current job so this was valuable information

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What is the Difference Between Management and Leadership? - Management - WSJ.com

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The manager's job is to plan, organize and coordinate. The leader's job is to inspire and motivate. Learn the differences between management and leadership.

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This article gave me some additional knowledge on the topic of influencing.

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Formal and Informal groups are important to organizations. This article gave me some additional information on these categories.

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People are social creatures, they seek to connect with groups that share their values. There are many types of organizations that form for various reasons. Some organizations are formed to conduct business and generate profit. Other organizations form for social reasons or to perform volunteer work.

Businesses and governments are examples of formal organizations. Clubs or social networks are examples of informal organizations. Both types of organizations share many features in common, but they also have meaningful differences.

An organization consists of multiple people coming together to serve a purpose, and they can be designed to be permanent or temporary. Both formal and informal organizations can serve vital needs for people.

There are many different purposes for formal and informal organizations. That purpose might be profit through a business. Another example would be a family unit providing fundamental needs for each member. Both formal and informal organizations are useful in their own ways. Each type of organization is necessary for different reasons.

There are key differences between formal and informal organizations. Formal organizations are oriented toward reaching specific goals. Informal organizations are more oriented toward human psychological needs.

Often, formal organizations are more publicly visible than informal organizations. Informal organizations can form within formal organizations and also become formal over time.

The primary differences between an informal and formal organization are levels of structure and hierarchies that determine how members interact. Formal organizations are more structured and rely on authority based upon chains of command. Informal organizations do not require hierarchies of authority or structured internal processes. They are not formed in order to reach specific goals like a formal organization.

Formal organizations have clear hierarchies of leadership. These hierarchies and power relationships are clearly documented. Authority is appointed from upper levels of the hierarchy, such as management. For example, only management usually holds the authority to hire or fire employees.

Informal organizations typically do not follow hierarchies for authority. There is less emphasis on established authorities or multiple levels of hierarchy. Rather, authority is equal among all members. An example would be a book club where members are all equal because they are not pursuing a goal that would require authority.

Formal organizations are very structured in order to reach stated goals. A formal structure enables members to work together toward the same objectives. There are established laws and rules that govern labor and norms within a formal organization. An organizational chart would be an example of documented structure.

Informal organizations often are not very structured because their goals might be temporary or entirely social. There is no need for the extensive requirements of a formal organization. However, an informal organization may become formal over time. A study group of students for a semester-long course would typically not need a formal structure for organizing.

Formal organizations rely on status through predetermined authority roles for influence. Members of a formal organization look to leadership roles to provide guidance. There is a clear flow of influence through a formal organization. For example, a subordinate employee would not hold the same influence as a manager within a company.

Informal organizations tend to have more subtle norms that are expressed through customs, morals or beliefs that are often not written. Members are not pressured to perform by superiors. Members of an informal organization mostly have equal influence. For example, a volunteer group might rotate leadership among members on an ad hoc basis.

Formal organizations possess involved rules and laws regarding behavior and the outcomes of labor. There are also processes in place for hiring, firing and replacing members. Expectations for each member are outlined and documented. A job description is an example of a formal document describing the specific requirements for the members of a formal organization.

Informal organizations provide a psychological or social benefit for members. Relationships among members are more personal than role-related. Behavior is determined by group consensus. For example, social groups will follow norms that are not explicitly written.

Formal organizations may have rules regarding the flow of information and communication. The chain of command will determine how members communicate. Communication flow is determined by hierarchy. Often, information flows from leadership down to other members.

Informal organizations do not have specific guidelines for communication. All members are able to interact with each other without considering hierarchy. Members of informal organizations communicate freely with one another. An example might be a musical group where members do not need to inform a specific leader when they will be absent from a performance.

Formal organizations are formed to serve a specific purpose or meet set goals. There is a constitution or plan and extensive guidelines directing the organization toward its purpose. Leadership will regularly review how well goals are being met and plan accordingly. A formal organization will exist even if specific members leave the organization.

Informal organizations serve the needs of individuals and can be created spontaneously with a purpose that is not well-defined. Goals are not always clear because informal organizations primarily serve social requirements for members. An informal organization might dissolve if certain members leave the organization.

Formal organizations are useful for reaching defined goals. The structure of a formal organization makes it effective for realizing profit or conducting business. The components and structure of a formal organization are necessary in order to efficiently meet stated objectives.

Informal organizations can be more responsive to change due to the lack of rigid structure. They are inherently more oriented around people rather than outcomes. An example would be a company softball team that allows employees to interact socially away from the formal hierarchies in order to build morale.

Both formal and informal organizations serve human needs and meet goals ranging from financial to values-based. They allow people to build communities and achieve goals that would not be possible alone.

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What Is the Difference Between an Informal & Formal Organization?

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What Is the Difference Between an Informal & Formal Organization?. The concepts of formal and informal organizations relate to the nature of relationships and processes in the workplace. A formal organization is the literal structure of the organization including its organization chart, hierarchical reporting ...

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EEOC. Equal Opportunity is a very important subject to me. This is additional information about the EEOC and what they do.

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Home | U.S. Equal Employment Opportunity Commission

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I was very impressed by the information we learned about recruiting in Chapter 10. This is recruiting website for my company.

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© 2020 Academy Sports + Outdoors. All Rights Reserved.

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I really found the article on Zappo's interesting, so I did some additional research and was impressed by their programs.

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Are you looking for information about how to consciously create the corporate culture that will help you accomplish your business goals?

Zappos consciously creates and reinforces its corporate culture. The work environment provided for employees won't attract every job searcher, and it's not for every employee. But, the people who fit the corporate culture thrive working for Zappos.

In an interview with Rebecca Henry, the former Director of Human Resources for Zappos, two key factors stood out. The company consciously decides what the corporate culture needs to look like and it consciously reinforces and supports that culture through all Human Resources and management work systems.

Deliver WOW Through Service

"Embrace and Drive Change

"Create Fun and A Little Weirdness

"Be Adventurous, Creative, and Open-Minded

"Pursue Growth and Learning

"Build Open and Honest Relationships With Communication

"Build a Positive Team and Family Spirit

"Do More With Less

"Be Passionate and Determined

"Be Humble"

Zappos takes specific actions every day that reinforces its culture of a fun workplace that is a tiny bit weird. With a majority of call center employees, this makes sense. Take these ideas, where possible, and use them to reinforce the culture in your workplace.

A training team trains employees in each core value. So, every employee hears the same message, learns the values, and learns the behavior that is expected to live the values every day at work. The trainers are available for training value gaps.

The hiring process at Zappos is more like a courtship than a traditional recruitment. Ms. Henry, for example, attended a merchandising team recognition meeting at a bar and interacted with Zappos' employees in a variety of social settings for four months before they agreed to the relationship. While the courtship may not be as rigorous for every job, before an employee is hired, he or she will meet with multiple employees and normally attend some type of department or company event. It allows the employees who are not participating in interviews to meet the prospective employee informally.

Zappos takes cultural fit seriously and hires slowly. Months can pass between an initial cultural fit interview with an HR recruiter and an actual job offer. If a potential employee fails to pass the cultural fit interview (50% of the weight in hiring), he or she is not invited to meet the hiring manager and other employees. While not all hires wend this slow road, Zappos hires for cultural fit first.

Interviewers have developed five or six behaviorally based questions that illuminate a candidate's congruence with each of the Zappos core values cited earlier. This approach to interviewing allows interviewers to assess a candidate's potential ability to fit within the culture and to exhibit the necessary skills.

Every interviewer gives specific feedback about candidates; some hires require consensus from the interviewers, some vote. Interviewing team members enter feedback directly into a computer system. They answer specific questions followed by free forms that assess their opinions of the candidate's fit at Zappos.

If you are hired by Zappos, you can expect to spend your first three to four weeks manning phones in their call center learning how to respond to customer needs. While this is an introduction to the soul of the business, it is also a practical approach to serving customers all year long. Zappos does not hire temporary employees during the busy seasons, so all employees are expected to sign up for shifts in the call center to handle busy times such as holidays. The early training allows employees to serve customers professionally. When crunch time comes, each employee puts in their ten hours a week in the call center.

Upon completion of their time in the call center, Zappos employees are offered $3,000.00 to leave the company. Yes, you heard that correctly. Leave. If you haven't become a Zappos insider, committed to the goals and the culture, the company really prefers that you leave. Take the money, though, and you can never come back.

Raises at Zappos come from building skills and capabilities. Employees pass skill tests and receive pay raises. Raises do not come from schmoozing with managers or other preferential actions that are not measurable. Call center employees are expected to be available for customer calls 80% of the time, and this is the standard employees must meet. Standards are not yet in place for mid-management to senior management in all jobs.

Each manager is expected to spend 10-20% of the department's time on employee team building activities. It makes employees feel comfortable with the culture, with each other, and they develop relationships that live the core values that Zappos espouses. Activities range from contest dioramas from movies in employee services to the shipping department putting on an Easter egg hunt. Various departments hold cookouts regularly. Zappos sponsors a couple of family events a year and three big company-wide events: a summer picnic, a January party at Tony Hsieh's, and a vendor party that employees and families attend. Additionally, Zappos holds quarterly smaller events such as theater, bowling alley parties, and so on.

Managers are key at Zappos for promoting the company culture. Managers hire and fire, but they must do it with Human Resources support. Managers make job offers; call and then make a written job offer. Managers enter data in offer letterforms for consistency.

Performance evaluations at Zappos reinforce the culture. Managers do cultural assessments rather than performance evaluations and give employees feedback on their fit within the culture and how to improve. In an environment that gives raises based on skill tests, this makes sense.

Managers are responsible for creating career paths within their departments. They have a regular career path for individual contributors and a super star career path for individuals who excel. Living the cultural norms is key in career progression.

Call center employees are fully empowered to serve customers. At Zappos, these customer service employees do not work from a script and are encouraged to use their imagination to make customers happy. They do not have to ask permission from a boss to give their customers the wow factor. With over 75% of sales from repeat customers, they succeed.

Zappos has a culture book that is written by employees every year. It details how people feel about the Zappos culture and how they reinforce and develop the culture every day. Statements attributed to employees emphasize and reinforce the Zappos culture. Zappos gives these culture books to anyone who tours the company or writes an email to the company and asks for a copy.

Zappos provides tours of the company in Henderson, NV. They have an employee who organizes these tours, and the company will even pick you up at the airport and bring you to their location if you've arrived in town for the tour. Tourists get to meet employees, marvel at the decorated work areas, observe daily business, and ask questions about the work environment and culture. Employees seem proud to show off their zany, loud, decorated workplace say several people I know who have taken the tour. Guests are greeted at every corner by ringing cowbells, employees signing, and spur of the minute parades. Zany, fun, and a little bit weird.

In a process that they had just started, when I spoke with Ms. Henry, during the last three-four days of new employees working in the call center, new employees participate in a scavenger hunt to meet people and to find things out about the company.

An employee's whole department is invited to their graduation after they have completed their call center stint and the scavenger hunt. Employees graduate to the regular workforce to the tune of music like Pomp and Circumstances, certificates delivered on a stage, and with the cheering of their families and new departments ringing in their ears during the ceremony.

Following call center learning, the scavenger hunt, and graduation, the employee's department takes over and provides employee orientation and continues to reinforce the company values. Each department has developed their own process that will ensure new employee success.

Zappos staffs Human Resources for success with people. The corporate group provides company-wide services like the employee handbook.

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Find Out How Zappos Reinforces Its Company Culture

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Are you looking for information about how to consciously create the corporate culture that will help you accomplish your business goals? Zappos consciously creates and reinforces its corporate culture. The work environment provided for employees won't attract every job searcher, and it's not for every employee.

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Organizational Culture. This article from Forbes Magazine gives great insight on organizational culture.

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Every Silicon Valley executive has an opinion about what company culture means and why it's important, myself included. But it's premature to focus on building a world-class culture before a world-class product. In the beginning, all that matters (or should matter) is building something great and lasting. Only then, as your company grows, can culture exert its powerful effect on people by steering them to act or to behave in a certain way when the path is otherwise unclear.

When headcount is in single digits, founders, CEOs and first employees sit and talk through every decision together. The problems are simpler, the communication more direct - and there's less ambiguity about what's important and how to act. Your culture is implicit in the personalities and values of this early group. That was certainly my experience with Okta, the startup I founded in 2009 to help businesses and their IT departments contend with big changes that were affecting 'business as usual.'

And then it happened. I woke up and no longer knew the name or role of every person whom I passed in the office. At 100+ talented and driven employees, it wasn't always clear how to act, how to communicate and how to prioritize in a fast and dynamic environment. The level of context shared at 10 employees just was not there at 100.
When Culture Really Starts to Matters
It was time to think about what sort of company we wanted and how we would get there. It wasn't enough just to 'let it happen' on its own. Just like we'd maniacally built the product, we needed to do the same with culture.

Of course, this inflection point is different for every fast-growing company, but the good ones all get there eventually. As you grow, it becomes harder to communicate everything, to get consensus on every decision or to create a process and procedure for everything. A strong and clear culture can give everyone the proper framework to work within.

Here are six lessons we've learned along the way:

Assign An Owner: It sounds simple, but companies need someone who is directly responsible for culture. Of course, that person can't do it on their own, but deputize someone to focus on culture and push everyone else in the right direction - whether they're hiring candidates or managing the engineering team as it sets priorities.

Leadership Sets Tone: Culture is shaped mostly by how your leaders act, so make sure your leadership team embodies the type of company you want to be. Is a 'teamwork culture' the ideal? You'd better make sure your executive team truly works as a team. Is 'transparency' most important? Guess what, your leaders better be transparent - even when it's difficult. My alma mater salesforce.com and its leader, Marc Benioff, are famous for valuing customer success above all else. If you were a leader at salesforce.com and didn't put customer success front and center, you were quickly shown the door. No excuses or questions asked.

Structure Says Everything: Organizational structure drives culture. Apple famously elevated the design group in the organization by having them report directly to the CEO. If you take pride in being a product and engineering-driven company, but those teams are buried in the hierarchy and under a marketing leader, I'd question how much you value product.

Not Just Kumbaya and Trust Falls: Hold an offsite. Seriously. On the surface, it may seem like a waste of time to executives being pulled in 50 different directions simultaneously, but it's important. Get employees who you think exemplify the culture you want to build and ask them some simple questions: What do you like about the current culture? What don't you like? What is culture, anyway? Does it even matter?

Understand that culture doesn't have to be neatly wrapped up at the end. Questions will go unanswered. There will be disagreement. You won't define culture by the end of the offsite, but you will know where you're headed, why and how to get there.

Prioritize and Focus: Sure, every leader has the utopian vision of running a company where everyone's happy, has fun, loves their coworkers, brings their dogs to the office and specialize at marketing, design, engineering and sales. Don't fall victim to the cult of the 'rock star,' a popular trap in Silicon Valley. Give me five people who work together as a team, as opposed to the one person who's talented at everything. They're not, and it's not worth the trouble.

Decide what will really move the needle for your product and customers, and act as a team. And don't be afraid to disagree with your customers. They don't always know what they need, and their requests might not be in your company's (or your product's) best interest.

Communicate. Always: Communicate your values and culture explicitly and continuously, both internally and externally. Employees must understand your culture, and why it's important. Reward employees who advance your culture, and be open and honest with those who don't.

Do this always and in tandem with every other culture initiative, or your culture will be merely hollow words on a mission statement. Done well, however, and the culture will bleed into employees who will spread your culture, whatever it may be.

As your company grows, culture will help keep it on track, steer hiring decisions for the people who will maintain that success and safeguard your company from spiraling into something you don't recognize - even if you no longer know everybody's name.
You can find McKinnon on Twitter at @ToddMcKinnon.

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The following guest post is by Todd McKinnon, CEO of Okta. Every Silicon Valley executive has an opinion about what company culture means and why it's important, myself included. But it's premature to focus on building a world-class culture before a world-class product. In the beginning, all that matters (or should [...]

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Module Five
Employee Challenges to Authority. This is something we actually have classes on with our lower management to help them deal with these issues.

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An employee who challenges your authority disrupts the workforce and negatively impacts the morale within a department or division by distracting other workers from the task at hand. In a small business, a challenge to management's authority is likely to be even more pervasive. Because of the small size of the company, the negative morale will permeate the entire organization quickly, reducing productivity and having a detrimental effect on the business overall. Small business owners must recognize challenges to their authority and act quickly to prevent the behavior from reoccurring.

Direct Challenge

Direct challenges to authority include the outright refusal to follow policy, procedures or the manager's directives. The employee who directly challenges your authority is likely to respond aggressively to instructions, unleashing unrestrained criticism and commentary about any ideas or guidelines for which he's dissatisfied. This employee shows he's not afraid to confront you openly in the office and often will attempt to draw you into a full-blown argument. Typically, the employee "blows up" and vents his frustration to the entire work group and then leaves everyone else to deal with the aftermath of his behavior.

Indirect Challenge

Indirect challenges to authority may be more difficult to detect. An employee can undermine your authority subtly with passive-aggressive behavior like talking behind your back or making visible signs of disagreement, such as eye-rolling, folded arms or hands on the hips. The employee also may refuse indirectly to carry out instructions by failing to complete work by the required deadline or by remaining unresponsive and noncommittal when you issue a directive or ask for a status update.

Generational Factors

The degree to which an employee challenges authority might depend on his generation. Generations should not be stereotyped, and the traits of each generation don't necessarily apply to all members of that group, but certain characteristics can be representative of each generation. For example, the "silent generation" or "traditionalists"--born between 1900 and 1945--place a far greater respect on authority than other generations. Baby boomers specifically challenge authority and question everything--including management. For this reason, a traditionalist manager may be more sensitive to a perceived challenge to his authority than a manager of another generation, while a baby boomer may see challenges as a sign of a worker who cares about the work product.

Violence in the Workplace

Challenging authority can be a sign of impending violence. The State of Iowa, in a document titled "Violence-Free Workplace Guidelines," states that persistent challenges to authority--such as refusing to adhere to company policy, sabotaging work products or other coworkers, or even the theft of property as revenge--can be a sign that the employee will go on to more serious threats of violence or physical acts in the workplace and must be dealt with immediately.

Photo Credits

BananaStock/BananaStock/Getty Images

About the Author

For more than a decade, Tia Benjamin has been writing organizational policies, procedures and management training programs. A C-level executive, she has more than 15 years experience in human resources and management. Benjamin obtained a Bachelor of Science in social psychology from the University of Kent, England, as well as a Master of Business Administration from San Diego State University.

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What Does it Mean to Say an Employee Challenged Authority?

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What Does it Mean to Say an Employee Challenged Authority?. An employee who challenges your authority disrupts the workforce and negatively impacts the morale within a department or division by distracting other workers from the task at hand. In a small business, a challenge to management's authority is likely to ...

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This topic gave me information and ideas on how I would want to run the areas of my own company.

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What Are Types of Departmentalization That Would Be Used in a Restaurant?

Departmentalization is an aspect of organizational design where a business divides its staff into smaller units based on tasks within the company. Most companies, including restaurants, are likely to use two or more types of departmentalization at the same time. Restaurants are often organized around the types of food served, the tasks handled by the staff and the chain of command in the company. Other departments may be developed if there are a add-on services such as banquet facilities and catering or if there are several stores within a geographic region.

Regional Groupings

Regional grouping is likely to be used in a restaurant chain where more than one branch of the same chain exists in a region, city or county. For example, the 25 percent of McDonald's restaurants that are not franchises are managed by a hierarchy of staff, including area supervisors. Each area supervisor is responsible for the performance of a group of stores within a specific geographical area.

Staff Functions

Functional departmentalization in a restaurant allows the separation of sales and marketing tasks from those jobs connected with operations. Sales would fall under the role of a server assisting customers and helping them select an enjoyable meal while operations in a restaurant centers on the preparation of food. In this scenario, management may have difficulty deciding where to include staff that makes and serves drinks at the restaurant's bar, because they are involved in both activities.

Products Offered

Departmentalization according to product type could work in various way depending on the size of the restaurant. Activities and costs related to food preparation and service might be separated from those that related to the preparation and serving of drinks. In large restaurants, the kitchen may be divided into preparation sections such as salads, grilling station, side dishes and desserts. In this type of departmentalization, the bar becomes a separate department from the dining area or kitchen, a logical method of categorization in this industry.

Chain of Command

Chain of command departmentalization works when the restaurant is large enough to require more than one management division. For example, roles may be divided into front of house and back of house. The manager who oversees servers, food runners, bartenders and hostesses will be in charge of the front of the house. The back of house manager will oversee workers such as chefs, cooks, and dishwashers. In some instances there may also be a General Manager or Owner who will oversee the entire operation and staff.

Types of Customers

Customer departmentalization works by dividing the organization around the different types of customers. In a restaurant environment, this could take the form of individual customers versus catering for corporate clients and hosting group events. One group of staff may handle the day-to-day operations of the restaurant, while a separate group manages the catering arm of the company, whether on the premises or outside. Departmentalization like this would effectively also be functional and possibly chain-of-command departmentalization at the same time.

Combined Departmentalization

Depending on the size of a restaurant, it may use two or more types of departmentalization. A chain may split its operation along the lines of both product and chain of command by having a food department and a beverage department, with food reporting to the chef while beverage reports to the licensee. A smaller restaurant may use functional departmentalization, such as kitchen operations versus customer service, and combine this with process departmentalization. This would result in the kitchen staff, already defined by function, being further divided into segments. Some kitchen staff would focus on actual cooking and food preparation while others would assist with more service related tasks like dressing salads and plating desserts for delivery to guests.

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What Are Types of Departmentalization That Would Be Used in a Restaurant?

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Departmentalization is an aspect of organizational design where a business divides its staff into smaller units based on tasks within the company. Most companies, including restaurants, are likely to use two or more types of departmentalization at the same time.

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Formal structure and informal structure. I found this information to be very informative. It gave me ideas of the structure in our workplace.

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Basic Types of Organizational Structure: Formal & Informal

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Almost every company has a formal structure in place, even if that structure is only loosely adhered to. Most organizations also have an informal structure as well. There are times when the informal structure conflicts with the formal structure, making it important to understand the intricacies of both types. ...

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Strategic Management Process. This is something that I took from this class and utilized in one of our management meetings. I really liked the steps that it goes through.

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components of strategic management process

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Strategic Management Process - Meaning, its Steps and Components

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Strategic Management Process means defining the organizations strategy. Strategic management process consists of four components - Environmental Scanning, Strategic Formulation, Strategy Implementation and Strategy Evaluation

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In chapter 6, we discussed decision making. The following website talks about the six steps for rational decision making. This is something I am trying to incorporate into my daily management.

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1. Define the problem.

2. Identify decision criteria
3. Weight the criteria
4. Generate alternatives
5. Rate each alternative on each criterion
6. Compute the optimal decision

This step brings the decision maker's interests, values, and personal
preferences into the process.

Identifying criteria is important because what one person thinks is

relevant, another may not.

Also keep in mind that any factors not identified in this step are
considered as irrelevant to the decision maker.

Weight the criteria

The decision-maker weights the previously identified criteria in order
to give them correct priority in the decision.

Generate alternatives
The decision maker generates possible alternatives that could
succeed in resolving the problem. No attempt is made in this step to
appraise these alternatives, only to list them.

Rate each alternative on each criterion

The decision maker must critically analyze and evaluate each one.
The strengths and weakness of each alternative become evident as
they compared with the criteria and weights established in second
and third steps.
Compute the optimal decision
Evaluating each alternative against the weighted criteria and
selecting the alternative with the highest total score.

Assumptions of Model
1. Problem clarity. (The decision maker is assumed to have
complete information regarding the decision situation.)
2. Known options (Identify all the relevant criteria and can list all
the viable alternatives. The decision maker is aware of all the
possible consequences of each alternative.)
3. Clear preference (The criteria and alternatives can be ranked
and weight to reflect their importance)
4. Constant preferences (The specific decision criteria are constant
and that weights assigned to them are stable over time)
5. No time or cost constraints
6. Maximum payoff

Part 2 - Improving Creativity in Decision Making

Creative Potential - Get out of the psychological ruts most us get
into and learn how to think about a problem in divergent ways.

Three-Component Model of Creativity

 Expertise (The foundation of all creative work)
knowledge of a subject were necessary conditions for us to
be able to make creative contributions to the fields. The
potential for creativity is enhanced when individuals have
abilities, knowledge, proficiencies, and similar expertise in
their fields of endeavor.
 Creativity Skills (The ability to use analogies to see the
familiar in a different light. Apply an idea from one context to
another)
Intelligence, independence, self-confidence, risk taking, and
internal locus of control, tolerance for ambiguity and
perseverance in the face of frustration.
 Intrinsic task motivation (The desire to work on a task)
interesting, involving, exciting, satisfying, or personally
challenging these factor would be affect the task motivation.
This would turns creativity potential into actual creative
ideas.
Five organizational factors can impede staff creativity:
1. Expected Evaluation [Focusing on how staff's work is going
to be evaluated]
2. Surveillance [Being watched while staff are working]
3. External motivators [Emphasizing external, tangible
rewards]
4. Competition [Facing win-lose situations with peers]
5. Constrained choice [Being given limits on how staff can do
their work.]

Part 3 - How Decisions Are Actually Made in Organization

People are usually content to find an acceptable or reasonable
solution to their problem rather than optimal one. Consequently,
decision makers generally make limited use of their creativity.
Choices tend to be confined to the neighborhood of the problem
symptom and to the neighborhood of the current alternative.
"Most significant decisions are made by judgment, rather than by a
defined prescriptive model."

Bounded Rationality
when a staff considered which college to attend, they will not look
every viable alternative nor identify all the criteria that were
important in decision.
Instead of optimizing, staff probably "satisfied".

When faced with a complex problem, most people respond by

reducing the problem to a level at which it can readily understand.
The limited information-processing capability of human beings
makes it impossible to assimilate and understand all the information
necessary to optimize. So people satisfied; that is, they seek
solutions that are satisfactory and sufficient.

Because the capacity of the human mind for formulating and solving
complex problems is far too small to meet the requirements for full
rationality, individuals operate within the confines of bounded
rationality. They construct simplified models that extract the
essential features from problems without capturing all of their
complexity. Individuals can then behave rationally within the limits
of the simple model.

Once a problem is identified, the search for criteria and alternatives

begins. But the list of criteria is likely to be far from exhaustive. The
decision maker will identify a limited list made up of the more
conspicuous choices.

These are the choices that are easy to find and that tend to be
highly visible. In most cases, they will represent familiar criteria and
previously tried-and-true solutions.

Once this limited set of alternatives is identified, the decision maker

will begin reviewing them. But the review will not be comprehensive
- not all of the alternatives will be carefully evaluated. Instead, the
decision maker will begin with alternatives that differ only in a
relatively small degree from the choice currently in effect.

Following along familiar and will-worn paths, the decision maker

proceeds to review alternatives only until he or she identifies an
alternative that is "good enough" - one that meets an acceptable
level of performance.
The first alternative that meets the "good enough" criterion ends
the search. So the final solution represents a satisfying choice rather
than an optimal one.

The order in which alternatives are considered is critical in

determining which alternative is selected. Remember, in the fully
rational optimizing model, all alternatives are eventually listed in a
hierarchy of preferred order. Because all alternatives are considered,
the initial order in which they are evaluated is irrelevant. Every
potential solution gets a full and complete evaluation. But this isn't
the case with bounded rationality. If we assume that a problem has
more than one potential solution, the satisfying choice will be the
first acceptable one the decision maker encounters. Decision
makers use simple and limited models, so they typically begin by
identifying alternatives that are obvious, ones with which they are
familiar, and hose not too far from the status quo.

Solutions that depart least from the status quo and meet the
decision criteria are most likely to be selected. A unique and
creative alternative may present an optimizing solution to the
problem, but it's unlikely to be chosen because an acceptable
solution will be identified well before the decision maker is required
to search very far beyond the status quo.
Intuition
"Sometimes you're just got to go with your gut feeling,"

Intuitive decision making is an unconscious process created out

of distilled experience. They based on the experience to recognize
patterns and clusters of the problem to make a decision. Experience
allows the expert to recognize a situation and draw on previously
learned information associated with that situation to arrive quickly
at a decision. The result is that the intuitive decision maker can
decide rapidly with what appears to be very limited information.

Identifying Problems
Problems that are visible tend to have a higher probability of being
selected than ones that are important.
1. Easily to catch a decision maker's attention.
2. Decision maker want to appear competent and "on top of
problems". This desire motivates DM to focus on problems that
are visible to others

If a decision maker faces a conflict between selecting a problem that

is important to the organization and one that is important to the
decision maker, self-interest tends to win out. This tendency also is
related to the issue of visibility. It's usually in a decision maker's
best interest to attack high-profiles problems. It conveys to
performance is later reviewed, the evaluator is more likely to give a
high rating to someone who has been aggressively attacking visible
problems than to someone whose actions have been less obvious.

Developing Alternatives
since decision makers rarely seek an optimal solution, but rather a
satisfying one, we should expect to find a minimal use of creativity
in the search for alternatives. And that expectation is generally on
target.

Efforts will be made to try to keep the search process simple. It will
tend to be confined to the neighborhood of the current alternative.
More complex search behavior, which includes the development of
creative alternatives, will be resorted to only when a simple search
fails to uncover a satisfactory alternative.

Decision maker avoid the difficult task of considering all the

important factors, weighing their relative merits and drawbacks, and
calculating the value for each alternative.

Instead, they make successive limited (incremental) comparisons.

This branch approach simplifies decision choices by comparing only
alternatives that differ in relatively small degree from the choice
currently in effect. This approach also makes it unnecessary for the
decision maker to thoroughly examine an alternative and its
consequences; one need investigate only hose aspects in which the
proposed alternative and its consequences differ from the status
quo.

It acknowledges the non-comprehensive nature of choice; in other

words, decision makers make successive comparisons because
decisions are never made forever and written in stone, but rather
they are made and remade endlessly in small comparisons between
narrow choices.

Making Choices
In order to avoid information overload, decision makers rely on
heuristics, or judgmental shortcuts, in decision making.

1. Availability Heuristic
The tendency for people to base their judgments on information
that is readily available to them. Events that evoke emotions,
that are particularly vivid, or that have occurred recently tend to
be most available in our memory.
[When doing annual performance appraisals, tend to give more
weight to recent behaviors of an employee than to those of 6
months ago]
2. Representative Heuristic
decision makers tend to assess the likelihood of an occurrence by
trying to match it with a pre-existing category.
[Frequently predict the performance of a new product by relating
it to a previous product's success]
3. Escalation of Commitment
tendency to escalate commitment when a decision stream
represents a series of decisions. Escalation of commitment is an
increased commitment to a previous decision in spite of negative
information.
They "throw good money after bad" to demonstrate that their
initial decision wasn't wrong and to avoid having to admit they
made a mistake. People try to appear consistent in what they say
and do. Increasing commitment to previous actions conveys
consistency.
["I have a lot invested in the relationships."
"I have to go back and complete some deficiencies if I changed
to work on a degree in other fields."]

Individual Difference
1. Decision-Making Styles
The foundation of the model is the recognition that people differ
along two dimensions. The first is their way of thinking (intuitive
and creative). The other dimension addresses a person's tolerance
for ambiguity. Some people have a high need to structure
information in ways that minimize ambiguity; Others are able to
process many thoughts at the same time.
Tolerance for Ambiguity
Analytical Conceptual

Directive Behavioral

Way of Thinking (Rational -> Intuitive)

- People using the directive style have low tolerance for

ambiguity and seek rationality. They are efficient and logical.
But their concern for efficiency results in their making
decisions with minimal information and assessing few
alternatives. Directive types make decision fast, and they
focus on the short run.

- The analytical type has a much greater tolerance for

ambiguity than do directive decision makers. They desire
more information and consider more alternatives than do
directives. Analytical managers would be best characterized
as careful decision makers with the ability to adapt or cope
with new situations.

- Individual with a conceptual style tend to be very broad in

their outlook and consider many alternatives. Their focus is
long range, and they are very good at finding creative
solutions to problems.

- A behavioral style decision maker who work well with

others. They're concerned with the achievements of peers
and subordinates. They're receptive to suggestions from
others and rely heavily on meetings for communicating. This
type of manager tried to avoid conflict and seeks acceptance.

Some managers rely almost exclusively on their dominant style;

more flexible managers can make shifts depending on the
situation.
Level of Moral Development
Moral development is relevant in decision making because many
decision have an ethical dimension. An understanding of this
concept can help you see how different people impose different
ethical standards on their decisions.

Level Stage/ Description

Pre-conventional 1 Sticking to rules to avoid physical punishment
2 Following rules only when it's in your immediate interest
Conventional 3 Living up to what is expected by people close to you
4 Maintaining conventional order by fulfilling obligations to which
your have agreed
Principled 5 Valuing rights of others; and upholding non-relative values and
rights regardless of the majority's opinion
6 Following self-chosen ethical principle even if they violate the
law
Part 4 - Organizational Constraints
The organization itself constrains decision makers. They shape their
decisions to reflect the organization's performance evaluation and
reward system and organizationally imposed time constraints.
Previous organizational decisions also act as precedents to constrain
current decisions.

Performance Evaluation
Decision maker are strongly influenced in their decision making by
the criteria by which they are evaluated.

[If a division manager believes that the manufacturing plants under

his responsibility are operating best when he hears nothing
negative, we shouldn't be surprised to find that his plant managers
spend a good part of their time ensuring that negative information
doesn't reach the division boss.]

[If a college dean believes that an instructor should never fail more
than 10 percent of her students - to fail more reflects on the
instructor's ability to teach - we should expect that new instructor,
who want to receive favorable evaluations, will decide not to fail too
many students.]

Reward System
What choices are preferable in terms of personal payoff?
If the organization rewards risk aversion, managers are likely to
make conservative decisions.
[General Motors consistently gave out promotions and bonuses to
manager who kept a low profile, avoided controversy, and were
good team players. The result was that GM managers became very
adept at dodging tough issues and passing controversial decisions
on to committees]

System-Imposed Time Constraints

Organizations impose deadlines on decisions.
A host of decisions have to be made quickly in order to stay ahead
of the competition and keep customers be made quickly in orders to
stay ahead of the competition and keep customers satisfied.
And almost all important decisions come with explicit deadlines.
These conditions create time pressures on decision makers and
often make it difficult, if not impossible, to gather all the information
they might like before having to make a final choice. The rational
model ignores the reality that, in organizations decision come with
time constraints

Cultural Differences
The rational model does not acknowledge cultural differences. But,
we need to recognize that the cultural background of the decision
maker can have significant influence on his or her selection of
problems, depth of analysis, the importance placed on logic and
rationality, or whether organizational decisions should be made
autocratically by an individual manger or collectively in groups. (Like
Japan Manager is more group-oriented. Before making an important
decision, they collect a large amount of information, which is then
used in consensus-forming group decisions.)
Some cultures emphasize solving problems; others focus on
accepting situations as they are. Problem-solving decision maker
believe that they can and should change situations to their benefit.
Part 5 - Ethics in Decision Making
Utilitarian criterion
Decisions are made solely on the basis of their outcomes or
consequences.
The goal of it is to provide the greatest good for the greatest
number. This view tends to dominate business decision making.
(Efficiency, productivity, and high profits)
[
+ A focus on utilitarianism promotes efficiency and productivity.

- Ignoring he rights of some individuals particularly those with

minority representation in the organization.
]

Right criterion
This call on individuals to make decisions consistent with
fundamental liberties and privileges as set forth in documents such
as the Bill of Right.
An emphasis on rights in decision making means respecting and
protecting the basic rights of individuals.(The right to privacy, to
free speech, and to due process)

Justice criterion
This requires individual to impose and enforce rules fairly and
impartially so there is an equitable distribution of benefits and costs.

[
+ The interests of the underrepresented and less powerful
- Encourage a sense of entitlement that reduces risk taking,
innovation, and productivity.
]

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The Six-Step Rational Decision-Making Model

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The Six-Step Rational Decision-Making Model - Free download as Word Doc (.doc), PDF File (.pdf), Text File (.txt) or read online for free. The Six-Step Rational Decision-Making Model 1. Define the problem. 2. Identify decision criteria 3. Weight the criteria 4. Generate alternatives 5. Rate each alternative on each criterion 6.

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Forecasting. This chart gives some very good information between Quantative and Qualitive Forcasting.

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qualitative and quantitative forecasting - Bing images

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Qualitative Data Qualitative Vs. Quantitative Qualitative versus Quantitative What Is Quantitative Research Difference Between Qualitative & Quantitative Qualitative Observation Quantitative Definition Quantitative Data Analysis Quantitative vs Qualitative Research Methods Quantitative and Qualitative Examples Qualitative Research Methodology Qualitative Measures Qualitative Information Qualitative Evaluation Quantitative Vs.

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Management By Objectives. This is a strategy that I really appreciated. This article goes into a little more detail than our textbook

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Management by Objectives (MBO) is a process in which a manager and an employee agree upon a set of specific performance goals, or objectives, and jointly develop a plan for reaching them. The objectives must be clear and achievable, and the plan must include a time frame and evaluation criteria. For example, a salesperson might set a goal of increasing customer orders by 15 percent in dollar terms over the course of a year.

MBO is primarily used as a tool for strategic planning, employee motivation, and performance enhancement. It is intended to improve communication between employees and management, increase employee understanding of company goals, focus employee efforts upon organizational objectives, and provide a concrete link between pay and performance. An important factor in an MBO system is its emphasis on the results achieved by employees rather than the activities performed in their jobs.

IMPLEMENTING AN MBO PROGRAM

To be successful, an MBO program should be part of a small business's overall system of planning and goal setting. The first step in implementing MBO is to establish long-range company goals in such areas as sales, competitive positioning, human resource development, etc. A small business owner may find it helpful to begin by defining the company's current business and looking for emerging customer needs or market trends that may require adaptation. Such long-range planning provides a framework for charting the company's future staffing levels, marketing approaches, financing needs, product development focus, and facility and equipment usage.

The next step in establishing an MBO system is to use these long-range plans to determine company-wide goals for the current year. Then the company goals can be broken down further into goals for different departments, and eventually into goals for individual employees. As goal-setting filters down through the organization, special care must be taken to ensure that individual and department goals all support the long-range objectives of the business. Ideally, a small business's managers should be involved in formulating the company's long-range goals. This approach may increase their commitment to achieving the goals, allow them to communicate the goals clearly to employees, and help them to create their own short-range goals to support the company goals.

At a minimum, a successful MBO program requires each employee to produce five to ten specific, measurable goals. In addition to a statement of the goal itself, each goal should be supported with a means of measurement and a series of steps toward completion. These goals should be proposed to the employee's manager in writing, discussed, and approved. It is the manager's responsibility to make sure that all employee goals are consistent with the department and company goals. The manager also must compare the employee's performance with his or her goals on a regular basis in order to identify any problems and take corrective action as needed.

Formulating goals is not an easy task for employees, and most people do not master it immediately. Small business owners may find it helpful to begin the process by asking employees and managers to define their jobs and list their major responsibilities. Then the employees and managers can create a goal or goals based upon each responsibility and decide how to measure their own performance in terms of results. In the Small Business Administration publication Planning and Goal Setting for Small Business, Raymond F. Pelissier recommended having employees create a miniature work plan for each goal. A work plan would include the goal itself, the measurement terms, any major problems anticipated in meeting the goal, a series of work steps toward meeting the goal (with completion dates), and the company goal to which the personal goal relates.

Small business owners may also find it helpful to break down employee goal setting into categories. The first category, regular goals, would include objectives related to the activities that make up an employee's major responsibilities. Examples of regular goals might include improving efficiency or the amount and quality of work produced. The second category, problem-solving goals, should define and eliminate any major problems the employee encounters in performing his or her job. Another category is innovation, which should include goals that apply original ideas to company problems. The final category is development goals, which should include those goals related to personal growth or the development of employees. Dividing goal setting into categories often helps employees think about their jobs in new ways and acts to release them from the tendency to create activity-based goals.

Another requirement for any successful MBO program is that it provide for a regular review of employee progress toward meeting goals. This review can take place either monthly or quarterly. When the review uncovers employee performance that is below expectations, managers should try to identify the problem, assign responsibility for correcting it, and make a note in the MBO files.

SMALL BUSINESS OWNER INVOLVEMENT

Given that MBO represents an unusual way of thinking about job performance for many employees, small business owners may find it best to introduce MBO programs gradually and to include a formal training component. A small business's managers can be introduced to MBO through a classroom seminar taught by the small business owner or by an outside consultant. Either way, it is important that the managers be allowed to express any doubts and reservations they may have, and that the training include preparation of an actual goal by each participant. When MBO is brought back to the small business, it may be best to start slowly, with each employee only preparing a few goals. This approach will allow employees to learn to prepare goals that are achievable, develop ways to measure their own performance, and anticipate problems that will prevent them from attaining their goals.

Another factor determining the success of MBO programs is the direct involvement of the small business owner. Pelissier noted that the small business owner needs to champion the MBO system from the beginning, as well as set an example for the company's managers, in order for it to succeed. Since managers have a natural tendency to focus their attention upon their own functions rather than on the goals of the overall organization, it can be difficult to educate them about MBO. It is also important for the small business owner to remain patient during the implementation phase: in fact, Pelissier claimed that it may take three to four years before an MBO program creates quantifiable results in a small business. As David Dinesh and Elaine Palmer indicated in their article for Management Decision, partial implementation is one of the major potential problems associated with MBO programs.

Implemented correctly, however, MBO can provide a number of benefits to a small business. For example, MBO may help employees understand how their performance will be evaluated and measured. In addition, by allowing them to contribute to goal setting, it may increase the motivation and productivity of a small business's employees. MBO also stands to provide a small business's employees with the means to prioritize their work on a daily basis. Although employee performance evaluation is still a complex task under an MBO system, MBO can also provide an objective basis for evaluation. However, it is important to note that an employee's failure to meet preestablished goals can be attributed to many things besides personal failure. For example, the failure to meet goals could result from setting the wrong objectives, not taking into account company restrictions that may impinge upon performance, establishing an improper measures of progress, or a combination of all of these factors.

Overall, establishing an MBO system in a small business may be difficult, but it is usually worth it. The most difficult aspect of implementing MBO may be simply getting people to think in terms of results rather than activities. Even when an MBO system is implemented well, a small business may encounter problems. For example, employees may set low goals to ensure attainment. Similarly, managers' objectives may focus on the attainment of short-term rather than long-term goals. Finally, employees and managers alike may fall victim to confusion and frustration. Some of the most common reasons for the failure of an MBO program include a lack of involvement among the top management of a small business, inadequate goal setting on a company-wide basis, implementation of an MBO system that occurs too rapidly, or the failure to instruct a company's managers and employees in the basics of MBO. But even though establishing an MBO program may be problematic, it can also offer significant rewards to small businesses.

FURTHER READING:

Bateman, Thomas S., and Carl P. Zeithaml. Management: Function and Strategy. Homewood, IL: Irwin, 1990.

Dinesh, David, and Elaine Palmer. "Management by Objectives and Balanced Scorecard: Will Rome Fall Again?" Management Decision. July-August 1998.

Pelissier, Raymond F. Planning and Goal Setting for Small Business. Washington, D.C.: Small Business Administration, n.d.

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Management by Objectives - benefits, Implementing an mbo program

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Management by Objectives (MBO) is a process in which a manager and an employee agree upon a set of specific performance goals, or objectives, and jointly develop a plan for reaching them. The objectives must be clear and achievable, and the plan must include a time frame and evaluation criteria.

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Marriot. This website gave me additional information concerning this corporate structure.

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hotel website; marriott hotel reservation

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Hotels & Resorts | Book your Hotel directly with Marriott

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Browse Marriott International's portfolio of hotels discover what makes each brand unique. Take the stress out of travel book your hotel reservation direct.

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Hofstede's Cultural Dimensions. I found this to be a very good analysis.

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hofstede's cultural dimensions theory - Bing images

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Hofstede's Five Cultural Dimensions Hofstede Culture Model Hofstede 6 Dimensions Hofstede's Six Cultural Dimensions Hofstede's Cultural Values Hofstede's 5 Dimensions Hofstede Masculinity Geert Hofstede Indulgence Hofstede Individualism Hofstede Hofstede Collectivism Indulgence vs Restraint Hofstede Hofstede Cultural Dimensions Examples Hofstede's Cultural Onion Theory Hofstede Cultural Scale Hofstede 4 Dimensions Hong Kong

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NAFTA. In chapter 4, we learned about NAFTA. This article goes into more detail and provided me better understanding of the concept

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North American Free Trade Agreement (NAFTA) | U.S. Customs and Border Protection

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Information for U.S. Exporters is available through the Department of Commerce at: http://www.export.gov/FTA/index.asp

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In module 3, we learned about Global Organizations. As my company is starting to take some of our business overseas, I found this information highly interesting. This article talks about the benefits of these multinational organizations

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Multinational corporations provide the different developing countries all over the world with the much needed financial infrastructure to achieve social and economic development. But together with the benefits that they offer come ethical conduct which happens to exploit the neediness of these developing nations.

Are multinational corporations really advantageous to a country or are they heavy weights that need to be let go for a nation to move forward all on its own?

The 4 Pros of Multinational Corporations

Below are some of the remarkable advantages that multinational corporations have to offer:

1. Size of Corporations Benefit From Consumers
The operational scale and size of corporations give them the chance of benefiting from the economies of scale that paves the way for lower average prices and costs for the consumers. It is particularly essential for those industries that carry extremely high fixed costs, like airlines and car manufacture.

2. Corporations Create Jobs And Wealth
The inward investment of these global companies offers the much required foreign currency for the developing economies. Also, these economies help in the creation of jobs and increasing expectations of the things that are likely to happen.

3. Minimum Standards Are Ensured
Multinationals usually succeed because the consumers prefer to purchase services and products on which they can go for minimum standards. For instance, when visiting a country, it will be easy for you to identify that Starbucks can offer you something that you are familiar with and though this might not be the best that you can find in the area, at least, it will not be the worst either. There is always security when you know what you can expect for.

4. Large profits Consumed For Development And Research
For instance, oil exploration is both risky and costly. Only large firms can undertake it with significant resources and profit. The same thing goes for the drug manufacturers.

The 5 Cons of Multinational Corporations

This time, take a look at the disadvantages linked to multinational corporations:

1. The Market Dominance Of Multinational Corporations
The market dominance of multinational corporations makes it hard for the local small firms to succeed and thrive. For instance, there are arguments stating that the larger supermarkets squeeze out a notable margin of the local corner stores that lead to lesser diversity.

2. Consumer's Expenses
Companies are usually interested at the consumer's expense. The multinational companies commonly have the power of monopoly that gives them the chance of making excess profit.

3. Pushing Local Firms Out Of Business
In the developing economies, these giant multinationals use the economies of scale for pushing the local firms out of their businesses.

4. Criticized For Using Slave Labor
Multinational corporations are being criticized for using the so-called slave labor wherein the workers are paid with very small wages.

5. Environment Threat
For the sake of profit, these global companies commonly contribute to pollution as well as make use of the non-renewable resources that can be a threat to the environment.

How Do You Feel About Multinational Corporations?

While it is true that multinational companies bring a lot of job opportunities, there is also no denying that they are the cause of some major issues in the economy. How about you? Do you think they are beneficial or only a big threat in countries?

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Multinational Corporations Pros and Cons

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Multinational corporations provide the different developing countries all over the world with the much needed financial infrastructure to achieve social and economic development. But together with the benefits that they offer come ethical conduct which happens to exploit the neediness of these developing nations.

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What workplace Diversity should look like.

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workplace diversity clip art - Bing images

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Diversity Word Art Inclusion Clip Art Diversity Vector Diversity Graphics Diverse Clip Art Diversity Illustration Types of Diversity Student Diversity Work Culture Clip Art Diverse Kids Clip Art Equality Clip Art Diversity Images Free Embrace Diversity Diversity Day Clip Art Diversity Drawing Cultural Diversity Art School Clip Art Diversity Diversity

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Chapter 3. We learned about Diversity in the workplace. This is something I feel very strongly about. This article talks about the advantages for organizations.

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Businesses are recognizing the need and importance of investing in diversity and inclusion as part of their overall talent management practices and to continually challenge their organizations to make the connection between those principles and their corporate performance..

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We learned about business ethics in chapter 2. This is a topic very important to me. This is the code of Ethics from Academy Sports which is where I work.

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Sustainability. This was a term that I was unfamiliar with prior to this class. This knowledge made me go back and research some of the policies of my company as well as others. This article goes into more depth on the subject.

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HuffPost - Breaking News, U.S. and World News

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Read the latest headlines, news stories, and opinion from Politics, Entertainment, Life, Perspectives, and more.

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The information we learned about some of the top CEO's and how they go to their position was very interesting.

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Employees have spoken! These are the Top CEOs for 2018, according to Glassdoor. Did your boss make the cut?

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We read an article concerning IBM and Rodney Adkins. The track of his career was very interesting to me and shows how people go about gaining advancement opportunities.

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Corporate executive and computer engineer Rodney Adkins was born on August 23, 1958, in Miami, Florida, to Archie and Wauneta Adkins. He attended Miami Jackson High School where he graduated in 1976 as valedictorian. In 1981, Adkins graduated from the Georgia Institute of Technology with his B.S. degree in electrical engineering.

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This article talks about efficiency and effectiveness. This was a concept that I learned this term and are currently using to assess the processes in my workplace.

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The Difference Between Efficiency & Effectiveness in Strategic Management

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Strategic management lays out goals and objectives for pursuing a company's mission. Your small business, from Day One, has had a strategic manager--you. If you have added managers since then, they are most likely involved in finding strategies to help your business succeed. One of those strategies may involve ...

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These are the four steps that I use in my workplace. It breaks down the processes I use as a manager

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What Are the Four Basic Functions That Make Up the Management Process?

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In 1916, a French coal mine director named Henri Fayol wrote a book entitled "Administration Industrielle et Generale," which set forth five distinct functions of managing that Fayol ...