S C H E R M E R H O R N B A C H R A C H
LEARN SUCCEED
MANAGEMENT T H I R T E E N T H E D I T I O N
Management
JOHN R. SCHERMERHORN, JR. OHIO UNIVERSITY
DANIEL G. BACHRACH UNIVERSITY OF ALABAMA
THIRTEENTH EDITION
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Library of Congress Cataloging in Publication Data:
Schermerhorn, John R.
Management / John R. Schermerhorn.—13th ed.
p. cm.
ISBN 978-1-118-84151-8 (unbound)
1. Management. I. Title.
Printed in the United States of America
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While you played
I wrote.
But always,
I was listening
and loving
you.
1984 It’s later now.
Don’t worry.
Time
means love shared,
by you
and me.
1986 Th ink
of all the fun
we have.
Here, there, everywhere,
doing things
together.
1989 Home,
now and forever,
will always be
wherever
I can be
with you.
1992 Time
has its ways,
doesn’t it?
Not enough,
not enough,
I often say.
1996
Hurry home
when you can.
Come laughing, sons.
Tell us
your
wonderful stories.
1999 Songs riding winds.
Mimi,
Uncle George,
Uncle Nelson.
Whispers and choirs.
Silence speaks.
2002 On the mountain,
by Irish lakes,
fi nd beauty and
peace.
Fairies dance
there.
2004 Mom loves
us, cats
and rainy days.
Nana and Poppy
loved us
too.
2007 Bookstores, museums,
stories, paintings.
And dreams.
We travel,
we laugh,
joined in life.
2009
While you work,
I’m starting to play
again.
Still listening,
and loving
you.
2011 When I
was young
I never knew
you would make
dreams
come true.
2013 No matter
the time
or day.
With a thought,
a memory,
I smile.
2015
From John
To my sons, John Christian and Charles Porter
From Dan
For Julie, Sammy, Eliana, Jakey, Jessica, Caleb, and Lilah—I love you!
iii
About the Authors Dr. John R. Schermerhorn, Jr., is the Charles G. O’Bleness Professor of Management Emeri-
tus in the College of Business at Ohio University, where he teaches graduate courses in manage-
ment and organizational behavior. Dr. Schermerhorn earned a PhD in organizational behavior
from Northwestern University, an MBA (with distinction) in management and international
business from New York University, and a BS in business administration from the State Univer-
sity of New York at Buff alo. He previously taught at Tulane University, the University of Vermont,
and Southern Illinois University at Carbondale, where he also served as head of the Department
of Management and associate dean of the College of Business Administration.
International experience adds a unique global dimension to Dr. Schermerhorn’s teaching
and writing. He holds an honorary doctorate from the University of Pécs in Hungary. He was
a visiting professor of management at the Chinese University of Hong Kong, on-site coordi-
nator of the Ohio University MBA and Executive MBA programs in Malaysia, and Kohei
Miura visiting professor at Chubu University in Japan. He has served as adjunct professor at
the National University of Ireland at Galway and advisor to the Lao-American College in
Vientiane, Laos. He presently teaches an MBA course at Università Politecnica Delle Marche
in Ancona, Italy, and PhD seminars in the Knowledge and Innovation Management doctoral
program at Bangkok University, Th ailand. At Ohio University he has twice been Director of
the Center for Southeast Asian Studies.
A member of the Academy of Management, Dr. Schermerhorn was chairperson of the
Management Education and Development Division. Management educators and students
alike know him as author of Exploring Management 4e (Wiley, 2014), Management 12e (Wiley,
2013), and co-author of Organizational Behavior 13e (Wiley, 2014). Dr. Schermerhorn has
also published numerous articles, including ones in the Academy of Management Journal,
Academy of Management Review, Academy of Management Executive, Organizational
Dynamics, Asia-Pacifi c Journal of Management, the Journal of Management Development, and
the Journal of Management Education.
Ohio University named Dr. Schermerhorn a University Professor, the university’s highest
campus-wide honor for excellence in undergraduate teaching. He is a popular guest speaker
at colleges and universities. He is available for student lectures and classroom visits, as well
as for faculty workshops on scholarly manuscript development, textbook writing, high
engagement teaching, and instructional and curriculum innovations.
Dr. Daniel G. Bachrach (Dan) is the Robert C. and Rosa P. Morrow Faculty Excellence Fellow
and Professor of Management in the Culverhouse College of Commerce and Business Admin-
istration at the University of Alabama, where he teaches graduate and undergraduate courses
in management. Dr. Bachrach earned a PhD in organizational behavior and human resource
management—with a minor emphasis in strategic management—from Indiana University’s
Kelley School of Business, an MS in industrial/organizational psychology from the University
of Wisconsin-Oshkosh, and a BA in psychology from Bates College in Lewiston, Maine.
A member of the Academy of Management and the Society for Industrial and Organiza-
tional Psychology, Dr. Bachrach serves on the editorial boards of the Journal of Applied Psy-
chology and Organizational Behavior and Human Decision Processes. He is co-editor of the
Handbook of Behavioral Operations Management: Social and Psychological Dynamics in
Production and Service Settings (Oxford University Press, 2014), co-author of Transformative
Selling: Becoming a Resource Manager and a Knowledge Broker (Axcess Capon, 2014), and
senior co-author of 10 Don’ts on your Digital Devices: Th e Non-Techie’s Survival Guide to Digital
Security and Privacy (Apress, 2014). Dr. Bachrach also has published extensively in a number
of academic journals including Organization Science, Journal of Applied Psychology, Strategic
Management Journal, Organizational Behavior and Human Decision Processes, Personnel Psy-
chology, Journal of Management, Leadership Quarterly, Production and Operations Manage-
ment, Journal of Operations Management, Journal of Supply Chain Management, and the
Journal of Personal Selling and Sales Management.
iv
Ohio University named Dr. Schermerhorn a
University Professor, the university’s highest
campus-wide honor for exellence in
undergraduate teaching.
Dr. Bachrach serves on the editorial boards
of the Journal of Applied Psychology and Organizational Behavior and Human Decision Processes.
Preface
From the beautiful cover of this book to the realities of organizations today, great accom-
plishments are much like inspired works of art. Whether one is talking about arranging
objects or bringing together people, technology, and other resources in organizational sys-
tems, it is a balancing act. But the results are spectacular when goals and talent combine to
create a lasting and positive impact.
Just as artists fi nd inspiration in all the senses that bring our world to life, managers fi nd
inspiration in daily experiences, from the insights of scholars, through relationships with
other people, and among the goals that guide organizations in an ever more demanding
society. And like artists, managers must master many challenges as they strive to create the
future from the opportunities of the present.
A well-managed organization—for profi t or nonprofi t, large or small—can build, mix, and
integrate all the beauties of human talent to achieve great things. Th is capacity for positive
impact through people is the goal bound into the pages of Management 13e. It is an oppor-
tunity to gain knowledge, fi nd inspiration, and learn practices that can help build the orga-
nizations we need to forge a better world.
New to Management 13e Management 13e has been revised and updated with a focus on real-world anchors for timely
content, student engagement in critical thinking about real-world and personal career
issues, and instructor opportunities for enriched classroom activities and assignments.
Timely content—All chapters have been updated. Examples of new and expanded coverage
include triple bottom line and shared value view (Chapter 3), disruptive innovation and human
sustainability (Chapter 4), reshoring and tax inversions (Chapter 5), social entrepreneurship and
crowdfunding (Chapter 6), data mining and analytics (Chapter 7), goal management and goal
downsides (Chapter 8 and Chapter 16), employment issues and controversies (Chapter 13),
followership and leadership (chapter 14), technology personality and mood contagion (Chap-
ter 15), and team virtuousness (Chapter 17).
Student engagement features—Student engagement is an embedded theme in Manage-
ment 13e. Look for these chapter features that bring life to disciplinary content: Analysis—
Make Data your Friend, Choices—Th ink Before You Act, Ethics—Know Right from Wrong,
Insight—Learn About Yourself, and Wisdom—Learn from Role Models. Each feature is
designed and visually presented to attract student attention and engage theme in refl ection
and critical thinking. Th ese features are introduced in the chapter opening page as part of
What to Look for Inside: Management Is Real.
Enriched Classroom Opportunities—Th e active and enriched classroom is also an embed-
ded theme in Management 13e. Look for these end-of-chapter opportunities that make it
easy to bring text content to life in discussions, activities, and individual and team assign-
ments: Evaluate Career Situations, Refl ect on the Self-Assessment, Contribute to the Class
Exercise, Manage a Critical Incident, Collaborate on the Team Activity, and Analyze the Case
Study. Th ese instructional enrichments are introduced in the chapter opening page as part
of What to Look for Inside: Skills Make You Valuable.
NNNeww ttoo MMMaanaagemmmmeennt 133e
v
vi PREFACE
Management 13e Philosophy Today’s students are tomorrow’s leaders and managers. Th ey are our hope for the future
during this time of social transformation. New values and management approaches are
appearing; organizations are changing forms and practices; jobs are being redefi ned and
relocated; the age of information is a major force in our lives; and, the intricacies of global-
ization are presenting major organizational and economic challenges.
Management 13e and its rich selection of timely examples and thought provoking
features for analysis and refl ection is designed for this new world of work. It is crafted to
help students understand that management is real and that is an everyday part of their
lives. By engaging with Management 13e, students explore the essentials of management
while also discovering their true potential for developing useful career skills. Th e con-
tent, pedagogy, and features of this edition were carefully blended to support manage-
ment educators who want their students to:
• grow in career readiness,
• become attractive internship and job candidates,
• gain confi dence in critical thinking,
• identify timely social and organizational issues,
• embrace lifelong learning for career success.
Management 13e Pedagogy Th e pedagogical foundations of Management 13e are based on four constructive balances
that are essential to higher education for business and management.
• Th e balance of research insights with formative education. As educators we must be
willing to make choices when bringing the theories and concepts of our discipline to
the attention of the introductory student. We cannot do everything in one course. Th e
goal should be to make good content choices that set the best possible foundations for
lifelong learning.
• Th e balance of management theory with management practice. As educators we
must understand the compelling needs of students to learn and appreciate the applica-
tions of the material they are reading and thinking about. We must continually bring to
their attention interesting and relevant examples.
• Th e balance of present understandings with future possibilities. As educators we
must continually search for the directions in which the real world of management is
heading. We must select and present materials that can both point students in the
right directions and help them develop the confi dence and self-respect needed to
best pursue them.
• Th e balance of what “can” be done with what is, purely and simply, the “right” thing
to do. As educators we are role models; we set the examples. We must be willing to take
stands on issues such as managerial ethics and social responsibility. We must be careful
not to let the concept of “contingency” betray the need for positive “action” and “account-
ability” in managerial practice.
Our students have pressing needs for direction as well as suggestion. Th ey have needs for
application as well as information. Th ey have needs for integration as well as presentation.
And they have needs for confi dence that comes from solid understanding. Our goal is to
put into your hands and into those of your students a learning resource that can help meet
these needs.
Management 13e is designed to help
students discover their true potential
and accept personal responsibilities for
developing career skills.
We are role models . . . we must be
willing to take stands on issues such
as managerial ethics and social
responsibility.
Our goal as educators should be to
make good content and pedagogical
choices that set the best possible foun-
dations for lifelong learning.
MMaanaggeeemmenttt 3ee oossoppp yyy
MMaanaggeeemmenttt 13ee PPeedaaggoggyy
viiPreface
Management 13e Highlights Management 13e introduces the essentials of management as they apply to organizations
and careers in a complex global society. Th e subject matter is carefully chosen to meet
AACSB accreditation guidelines, while still allowing extensive fl exibility to fi t various course
designs, class sizes, and delivery formats.
Th e timely chapter content off ers fl exibility in meeting a wide variety of course objectives
and instructor preferences. Th e chapters are organized in fi ve logical parts—Management,
Environment, Planning and Controlling, Organizing, and Leading. Th e parts and individual
chapters can be used in any order and combination. All chapters have been updated and
enriched with new features and examples from the latest current events.
Learning Model
Th e Management 13e learning model makes it easy for students to read, study, refl ect, and
use critical thinking. Th eir attention is focused on building management skills and compe-
tencies through active learning, and on discovering that management issues and themes
permeate current events that aff ect everyday living.
Each chapter opens with a compelling photo and quote, followed by a learning dash-
board that provides a Quick Start overview, list of Key Takeaways, and a What to Look for
Inside directory in two parts: Management Is Real—with features on Analysis, Choices,
Ethics, Insight, and Wisdom; and, Skills Make You Valuable—with features on Evaluate,
Refl ect, Contribute, Manage, Collaborate, and Analyze. Major Figures within chapters pro-
vide visual support for student comprehension as concepts, theories, and terms are intro-
duced. Where appropriate, Small Boxed Figures and Content Summaries are embedded in the
text to help clarify major points. Th e Management Learning Review section at the end of each
chapter helps students prepare for quizzes and exams by completing a Takeaway Question
Summary and Chapter Self-Test.
Self-Refl ection, Active Learning, and Critical Th inking
Th e What to Look for Inside guide in the chapter-opening learning dashboard points out the
many features in Management 13e that provide students with important opportunities for
self-refl ection, active learning, and critical thinking. Within each chapter, Management Is
Real features present current events, timely issues, and real people and situations to build
awareness and stimulate personal refl ection. Examples include:
MANAGEMENT IS REAL MAKE DATA YOUR FRIEND
Multiple Generations Meet and Greet in the Workplace
THINK BEFORE YOU ACT
Want Vacation? No Problem, Take as Much as You Want
KNOW RIGHT FROM WRONG
Social Media Searches Linked with Discrimination in Hiring
LEARN ABOUT YOURSELF
Self-Awareness and the Johari Window
LEARN FROM ROLE MODELS
Ursula Burns Moves from Student Intern to Fortune 500 CEO
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Management is Real features present
current events, timely issues, and
real people and situations to build
awareness and stimulate personal
refl ection.
Th e Management 13e learning model
makes it easy for students to study,
refl ect, and use critical thinking as they
read.
MMMaanaaggemmmeentt 33ee gg g ttts
viii PREFACE
Management 13e Teaching and Learning Resources
Instructor’s Resource Manual. Th e Instructor’s Resource Manual off ers helpful teaching ideas. It has advice on course development, sample assignments, and recommended activi-
ties. It also off ers chapter-by-chapter text highlights, learning objectives, lecture outlines,
class exercises, lecture notes, answers to end-of-chapter material, and tips on using cases.
Test Bank. Th is comprehensive Test Bank (available on the instructor portion of the Management 13e website) has more than 175 questions per chapter. Th e true/false,
multiple-choice, and short-essay questions vary in degree of diffi culty. All questions are
tagged with learning objectives, Bloom’s Taxonomy categories, and AACSB Standards. Th e
Computerized Test Bank allows instructors to modify and add questions to the master bank
and to customize their exams.
PowerPoint Presentation Slides. Th is robust set of slides can be accessed on the instructor portion of the Management 13e website. Lecture notes accompany each slide.
Pre- and Post-Lecture Quizzes. Included in WileyPLUS Learning Space, the Pre- and Post-Lecture Quizzes focus on the key terms and concepts. Th ey can be used as stand-alone
quizzes, or in combination to evaluate students’ progress before and after lectures.
Lecture Launcher Videos. Short video clips developed from CBS News source materials provide an excellent starting point for lectures or for general class discussion. Teaching
Notes are available and include video summaries and quiz and discussion questions.
Movies and Music. Th e Art Imitates Life supplement, prepared by Robert L. Holbrook of Ohio University, off ers tips for those interested in integrating popular culture and the
humanities into their courses. It provides innovative teaching ideas and scripts for using
movies and music to enrich day-to-day classroom activities. It is widely praised for increas-
ing student involvement and enthusiasm for learning. Th e Art Imitates Life supplement
off ers tips for those interested in integrating popular culture and the humanities into their
courses.
SKILLS MAKE YOU VALUABLE EVALUATE Career Situations: What Would You Do?
REFLECT On the Self-Assessment: Career Readiness “Big 20”
CONTRIBUTE To the Class Exercise: My Best Manager
MANAGE A Critical Incident: Team Leader Faces Test
COLLABORATE On the Team Activity: The Amazing Great Job Race
ANALYZE Th e Case Study: Trader Joe’s: Keeping a Cool Edge
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At the end of each chapter, Skills Make You Valuable features provide a variety of opportu-
nities to build management skills through individual and team learning activities. Examples
include:
Skills Make You Valuable features
provide a variety of opportunities to
build management skills through
individual and team learning activities.
anndd Leeaaarnninggg Reeesourccees
ixPreface
Practice Quizzes. An online study guide with quizzes of varying levels of diffi culty helps students evaluate their progress through a chapter. It is available on the student portion of
the Management 13e website.
Student Portfolio Builder. Th is special guide to building a student portfolio is complete with professional résumé and competency documentation templates. It is on the student
portion of the Management 13e website.
Companion Website. Th e Management 13e website at www.wiley.com/college/ schermerhorn contains a myriad of tools and links to aid both teaching and learning,
including resources described earlier.
WileyPlus Learning Space
What is WileyPLUS Learning Space? It’s a place where students can learn, collaborate, and
grow. Th rough a personalized experience, students create their own study guide while they
interact with course content and work on learning activities.
WileyPLUS Learning Space combines adaptive learning functionality with a dynamic new
e-textbook for your course—giving you tools to quickly organize learning activities, manage
student collaboration, and customize your course so that you have full control over content
as well as the amount of interactivity between students.
You can:
• Assign activities and add your own materials
• Guide students through what’s important in the e-textbook by easily assigning specifi c
content
• Set up and monitor collaborative learning groups
• Assess student engagement
• Benefi t from a sophisticated set of reporting and diagnostic tools that give greater
insight into class activity
Learn more at www.wileypluslearningspace.com. If you have questions, please contact your
Wiley representative.
Acknowledgments Management 13e was initiated and completed with the support of our dedicated and help-
ful Project Editor, Jennifer Manias; Executive Editor, Lisé Johnson, who again rallied the
expertise of a great Wiley team; and Susan McLaughlin, a talented and dedicated “Jack of
all trades.” We all have benefi tted from the special support of George Hoff man (Publisher),
Yana Mermel (Editorial Operations Manager), Tom Nery (designer), Mary Ann Price (photo
research), Suzie Chapman (production), and Kelly Simmons and Amy Scholz (marketing).
We also thank the numerous colleagues—too many to list here—whose help with this book
at various stages of its life added to our understanding of management and management
education.
As always, John works with the support and encouragement of his wife Ann. She perse-
veres even when “the book” overwhelms many of life’s opportunities. Dan is grateful for the
love, support, and guidance of his wife Julie, and the opportunity to work with John.
Brief Contents 1 Management Today 3
2 Management Learning Past to Present 29
3 Ethics and Social Responsibility 51
Part One Management
Part Th ree Planning and
Controlling
7 Information and Decision Making 147
8 Planning Processes and Techniques 173
9 Control Processes and Systems 195
10 Strategy and Strategic Management 215
Part Five Leading 14 Leading and Leadership Development 317
15 Individual Behavior 339
16 Motivation Th eory and Practice 365
17 Teams and Teamwork 389
18 Communication and Collaboration 415
Part Two Environment 4 Environment, Innovation, and Sustainability 77
5 Global Management and Cultural Diversity 97
6 Entrepreneurship and New Ventures 123
Part Four Organizing 11 Organization Structures and Design 241
12 Organization Culture and Change 265
13 Human Resource Management 291
Management Cases for
Critical Th inking
Chapter Cases 438
Self-Test Answers 467
Glossary 477
Endnotes 491
Name Index 523
Organizational Index 526
Subject Index 529
x
Part One Management
1 Management Today 3
Working Today 4
Talent 4
Technology 5
Globalization 6
Ethics 6
Diversity 8
Careers and Connections 9
Organizations 10
Organizational Purpose 10
Organizations as Systems 10
Organizational Performance 11
Changing Nature of Organizations 12
Managers 12
What Is a Manager? 12
Levels of Managers 13
Types of Managers 14
Managerial Performance 14
Changing Nature of Managerial Work 14
Th e Management Process 16
Functions of Management 16
Managerial Roles and Activities 18
Managerial Agendas and Networks 19
Learning How to Manage 20
Technical Skills 21
Human and Interpersonal Skills 21
Conceptual and Critical-Th inking Skills 22
Management Learning Review 23
Summary 23
Self-Test 1 24
Management Skills & Competencies 25
Evaluate Career Situations: What Would You Do? 25 Refl ect on the Self-Assessment: Career Readiness “Big 20” 25 Contribute to the Class Exercise: My Best Manager 26
Manage a Critical Incident: Team Leader Faces Test 26 Collaborate on the Team Activity: Th e Amazing Great Job Race 27 Analyze the Case Study: Trader Joe’s 27
2 Management Learning Past
to Present 29
Classical Management Approaches 30
Scientifi c Management 30
Administrative Principles 31
Bureaucratic Organization 32
Behavioral Management Approaches 33
Follett’s Organizations as Communities 33
Th e Hawthorne Studies 35
Maslow’s Th eory of Human Needs 36
McGregor’s Th eory X and Th eory Y 37
Argyris’s Th eory of Adult Personality 37
Modern Management Foundations 39
Quantitative Analysis and Tools 39
Organizations as Systems 40
Contingency Th inking 41
Quality Management 42
Evidence-Based Management 43
Management Learning Review 45
Summary 45
Self-Test 2 46
Management Skills & Competencies 47
Evaluate Career Situations: What Would You Do? 47 Refl ect on the Self-Assessment: Managerial Assumptions 47 Contribute to the Class Exercise: Evidence-Based Management Quiz 48 Manage a Critical Incident: Th eory X versus Th eory Y 48 Collaborate on the Team Activity: Management in Popular Culture 49 Analyze the Case Study: Zara International 49
Contents
xi
xii CONTENTS
3 Ethics and Social Responsibility 51
Ethics 52
Laws and Values as Infl uences on Ethical Behavior 52
Alternative Views of Ethics 53
Cultural Issues in Ethical Behavior 55
Ethics in the Workplace 56
Ethical Dilemmas 56
Infl uences on Ethical Decision Making 57
Rationalizations for Unethical Behavior 60
Maintaining High Ethical Standards 61
Moral Management 61
Ethics Training 62
Codes of Ethical Conduct 62
Whistleblower Protection 63
Social Responsibility 64
Social Responsibility, Sustainability, and the Triple Bottom Line 64
Perspectives on Corporate Social Responsibility 65
Evaluating Corporate Social Performance 68
Corporate Governance 69
Management Learning Review 71
Summary 71
Self-Test 3 72
Management Skills & Competencies 73
Evaluate Career Situations: What Would You Do? 73 Refl ect on the Self-Assessment: Terminal Values 73 Contribute to the Class Exercise: Confronting Ethical Dilemmas 74 Manage a Critical Incident: Dealing with a Global Supply Chain 74 Collaborate on the Team Activity: Stakeholder Maps 75 Analyze the Case Study: Patagonia 75
Part Two Environment
4 Environment, Innovation,
and Sustainability 77
Th e External Environment 78
Economic Conditions 79
Legal-Political Conditions 79
Sociocultural Conditions 80
Technological Conditions 80
Natural Environment Conditions 82
Environment and Value Creation 83
Value Creation and Competitive Advantage 83
Uncertainty, Complexity, and Change 85
Environment and Innovation 85
Types of Innovations 86
Th e Innovation Process 86
Disruptive Innovation and Technology 87
Environment and Sustainability 88
Sustainable Development 89
Sustainable Business 89
Human Sustainability 90
Management Learning Review 91
Summary 91
Self-Test 4 92
Management Skills & Competencies 93
Evaluate Career Situations: What Would You Do? 93 Refl ect on the Self-Assessment: Tolerance for Ambiguity 94 Contribute to the Class Exercise: Th e Future Workplace 94 Manage a Critical Incident: It’s Also about Respect 94 Collaborate on the Team Activity: Organizational Commitment to Sustainability Scorecard 95 Analyze the Case Study: