CHAPTER 5.

PLANNING

NỘI DUNG KIẾN THỨC

1. What is planning
- Definition
- Outcomes: 3
- Importance of planning: 4 reasons
2. Outcome 1: GOAL
- Definition
- Types: According to Time / Aim / Function / Level
- Characteristics of a good goal SMART + WC
- Two ways to set up goals: Traditional + MBO
3. Outcome 2: PLAN
- Types: According to Time / Breadth of use / Specificity / Frequency of use
- Business plan
4. Outcome 3: STRATEGY
- Definition
- Strategic management process: 6 steps
- Strategic management analysis tool: SWOT matrix
- Value chain model
- Level of strategies (BCG matrix is used in the Corporate level)

CHI TIẾT BÀI GIẢNG VÀ BÀI TẬP TRÊN LỚP

1. WHAT IS PLANNING
a. Definition
- Planning is often called the the primary management function because it establishes the basis for all
the other things managers do.
- It’s concerned with ends (what is to be done) as well as with means (how it is to be done)

E1. FILL IN THE BLANK

1. Planning is a (1) ________ process of (2) ________ up the goals, (3) ________ strategies
and (4) ________ plans to achieve the goals.
2. Planning includes the answer for (5) ________.

b. Outcomes of planning:
- Goals (most important)
- Plans
- Strategies
c. Importance of planning

E2. WHY IS PLANNING IMPORTANT?

_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
2. GOALS
a. Definitions

E3. FILL IN THE BLANK

1. Goal is the ______ (1) outcomes of ______ (2), _____ (3), and _______ (4).
2. Goal is the ______ (5) for other items of planning.

b. Types of goals
- According to TIMEFRAME:
Short-term goal (< 1 year) >> Mid-term goal (1 - 3 years) >> Long-term goal (> 3 years)
- According to AIMS:
+ Stated goals: Official statements of what an organization says, and wants its stakeholders to
believe, its goals are.
+ Real goals: Those goals an organization actually pursues as shown by what the organization’s
members are doing

E4. ANSWER THE QUESTIONS

1. What is the real goal of all enterprises?
____________________________________________________________________________

2. Why do firms need stated goals?

____________________________________________________________________________
____________________________________________________________________________

- According to FUNCTION:
Marketing goal / HR goal / Financial goal /…
- According to LEVEL:
Organizational goals >> Departmental goals >> Group goals >> Individual goals

c. Characteristics of a good goal

S M A R T W C
Specific Measurable Achievable Relevant Timebound Written down Challenging

Know Progress made Be sure the goal Be sure the goal Set time limits
exactly what towards the set is something is something
you want to goals must be you have the you can do and
achieve measureable ability to within the
accomplish desired time

E5. APPLY SMART AND WC TO FIX THE FOLLOWING GOALS

1. I will study better.
____________________________________________________________________________
2. Our company will be the best.
____________________________________________________________________________
3. Answer the customers as soon as possible.
____________________________________________________________________________
d. Two ways of setting up goals
- Traditional goal setting:
+ Goals set by top managers flow down through the organization and become sub-goals for each
organizational area
+ Employees follow
+ Goals are general and do not follow SMART principle
- Management By Objectives (MBO) goal setting
+ A process of setting mutually agreed-upon goals and using those goals to evaluate employee
performance.
+ Employees involve in setting goals
+ Goals are specific and follow SMART principle

E6. COMPARE TRADITIONAL GOAL SETTING VS. MBO GOAL SETTING

Traditional goal setting MBO goal setting
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________

3. PLANS
a. Types of plan
- According to TIME
+ Short-term
+ Mid-term
+ Long-term
- According to BREADTH OF USE
+ Strategic plan: Influences the whole organization (top managers)
+ Tactical plan: Influences the whole department (middle managers)
+ Operational plan: Influences daily, specific activities (first-line managers and employees)
- According to SPECIFICITY
+ Directional plan: Flexible and set general guidelines
+ Specific plan: Clearly defined and leave no room for interpretation
- According to FREQUENCY OF USE
+ Single use: Plan is designed to use once
+ Standing use: Plan is used and reused multiple times
b. Business plans
- A written document that summarizes a business opportunity, and
- Defines and articulates how the identified opportunity is to be seized and exploited (legal documents,
risk management, competitive advantages, business model, etc.)
4. STRATEGY
a. Definitions

E7. FILL IN THE BLANKS

1. Strategy is a set of _____ (1) in a particular ______ (2) to achieve the goals in _____ (3).
2. Strategic Management is a ______ (4) of planning, ______ (5), ______ (6), and ______ (7)
the strategies to achieve the goals.
3. The aims of Strategic Management are to_____ (8) with rivals and ______ (9) the customers.

b. Strategic management process

- STEP 1: Identifying the organization’s current mission, goals and strategies
- STEP 2: Doing an external analysis
- STEP 3: Doing an internal analysis
- STEP 4: Formulating the strategies
- STEP 5: Implementing strategies
- STEP 6: Evaluating results

E8. WHICH STEP IS THE MOST IMPORTANT? WHY?

____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________

c. Strategic management analysis tool 1 – SWOT MATRIX

- SWOT Matrix can be used in Step 2 and 3 for analyzing the environment, and in Step 4 for formulating
the strategies.
- SWOT matrix suggests that there are 4 strategies that can be applied:
(1) S-O (2) S-T (3) W-O (4) W-T
d. Strategic management analysis tool 2 – Value Chain model
- A contribution of Michael Porter
- The Model divides business activities into 2 categories:
+ Main activities:
(1) Inbound logistics;
(2) Operation;
(3) Outbound logistics;
(4) Marketing & Sales;
(5) Service
+ Supporting actitivies - Necessary for success implementation of main activities:
(1) Firm infrastructure;
(2) HR management;
(3) Technology development;
(4) Procurement
- Application of Value Chain Model:
+ Can be used in Step 3 for internal analysis to understand strengths and weaknesses as well as
competitive advantages of firms
+ Looking at this model will help find which stages the firm is good at to focus on, and which
stages the firm is not good at to outsource for more effective implementation.

e. Level of strategies: 3 levels of organizational strategies

(1) LEVEL 1: CORPORATE STRATEGIES
*Growth strategies:
- Strategies relating to the expansion of markets served / products offered either through current
business or though new business.
- Including:
+ Concentration growth: Firms concentrate on current market and main business (1 SBU only)
+ Diversification growth: (>= 2 SBUs)
 Classified into Related and Unrelated diversification (conglomerate)
 Including Opening new businesses in new fields / industries and M&A
+ Integration growth:
 Vertical integration: towards managing and controling the whole supply chain
 Horizontal integration: cooperate with another firms in the supply chain
*Stability strategies
- It is implemented when:
+ The environment is stable; and
+ The company does not have many strengths and weaknesses; or
+ [W-O] There are some opportunities, but the company is very weak; or
+ [S-T] The company has some strengths, but there are many threats.
- It is implemented when the company does not have much changes in size / product diversification.
* Renewal (Retrenchment) strategy
- It is implemented when there are many threats and the company is weak.
- When implementing this strategy, the company will close some branches or subsidiaries, or reduce
product diversification.
E9. WHICH GROWTH STRATEGY IS THIS?

1. Vietcombank opened new branches in Haiphong city.

2. Apple launched Ipads.
3. SHB merged with Habubank.
4. Kinh Do bought Wall ice-cream from Unilever.
5. FPT opened FPT University.
6. TH true milk opened a cow farm in Nghe An province.
7. HP merged with Compaq.
8. Coca Cola launched Dasani mineral water.
9. Sony cooperated with Erikson to produce cellphone.
10. Toyota and GM opened a factory in California to produce cars.

E10. FILL IN THE BLANKS

STABILITY STRATEGIES
1. It is implemented when the environment is ______ (1) and the company does not have
many ______ (2) as well as _______ (3), or there are some _______ (4), but the company
is very ______ (5), or the company has some _______ (6), but there are many ______ (7).
2. When implementing this strategy, the company does not have much changes in ______ (8)
or product _______ (9).

E11. FILL IN THE BLANKS

RETRENCHMENT STRATEGIES
1. It is implemented when there are many _____ (1) and the company is ______ (2).
2. When implementing this strategy, the company will ______ (3) some _______ (4) or
subsidiaries, or __________ (5) product diversification.

E12. BGC MATRIX EXERCISE (Read the next page before doing this exercise)
1. If relative market share is bigger than 1, what does it mean?
___________________________________________________________________________
2. If relative market share is 1, what does it mean?
___________________________________________________________________________
3. If relative market share is less than 1, what does it mean?
___________________________________________________________________________
4. Put the following products of Apple into the suitable position in BCG Matrix:
Ipad – Ipod – Iphone – Iwatch – Macbook
CORPORATE STRATEGY ANALYSIS TOOL: BCG MATRIX

Classify products into 4 categories based on the market growth rate and the relative market share.

*Market growth rate of the industry

STAR QUESTION MARK implies the potential to growth in the
industry.
MARKET GROWTH RATE

High earnings Low, unstable earnings - High growth rate = Growing industry
Stategy applied: Invest Strategy: (?) - Low growth rate = Declining industry
*Relative market share
CASH COW DOG - Implies the company’s position in
the industry:
High & stable earnings Low, unstable earnings Strong >> Moderate >> Weak
Strategy applied: Milk Strategy applied: Divest - Can be calculated as the company
market share divided by its biggest
RELATIVE MARKET SHARE competitor’s market share.
STRATEGIC CHOICE FOR EACH CATEGORIES:
(1) STAR – High growth High share
- Companies have lots of advantages in the industry
- Should invest more for growth
- Strategies that can be applied:
+ Vertical & Horizontal integration
+ Market penetration and development
(2) CASH COW – Low growth High share
- Cash cows are the most profitable products and should be “MILKED” to provide as much cash
as possible. Cash gained grom Cows should be invested into STARS to support further growth.
- Should NOT invest for new growth, except for supporting current market share
- Strategies that can be applied:
+ Product development
+ Diversification
+ Divestiture & Retrenchment
(3) DOG – Low growth Low share
- In general: not worth investing in because generating low or negative cash returns
- Two situations:
+ If the DOG is completely useless and incurs losses  DIVESTITURE / LIQUIDATION
+ If the DOG is still profitable in the long run / useful in providing synergies for another
SBUs or acting as a defense for counter competitor moves  RETRENCHMENT
(4) QUESTION MARK – High growth Low share
- Hold low market share in fast growing markets with high costs and losses
- Has high potential to gain market share and become STAR
But also has high risk to fail and become a DOG
- Requires very close consideration to decide if they are worth investing in or not
 (2) LEVEL 2 – COMPETITIVE STRATEGIES
Business-level strategies are also called competitive strategies
- Cost leadership: Competing on the basis of having the lowest costs in the industry.
- Differentiation: Competing on the basis of having unique products that are widely valued by
customers.
- Focus strategy: Competing in a narrow segment or niche with either a cost focus or a
differentiation focus.

E13. OPENING QUESTIONS ON COMPETITIVE STRATEGIES.

1. Competitive strategies are also called __________ strategies.
2. For Michael Porter, there are 2 sources of competitive advantages. What are they?
_________________________________________________________________________
3. Which tool that you have learnt can help firms find their competitive advantages?
_________________________________________________________________________
4. For the case of Apple, what are their competitive advantages?
_________________________________________________________________________

E14. FILL IN THE BLANKS

COST LEADERSHIP
1. Business level strategies are also called ______(1) strategies.
2. Companies try to have the ______(2) cost compared to other competitors in the ______(3)
with features which are accepted by _______ (4).
3. Companies will try to _____(5) costs of inputs or increase the ______(6) in management.
4. In retail industry in the US, the famous case of Cost Leadership Strategy is ________ (7).

E15. FILL IN THE BLANKS

DIFFERENTIATION
1. Companies try to create _____ (1) or _______ (2) characteristics for their product or
services.
2. Companies do not care much about _____ (3) and invest in _______ (4) and marketing
mainly to attract _______ (5).
3. An example of this strategy in laptop industry in the world is the case of ______(7).

E16. FILL IN THE BLANKS

FOCUS STRATEGY
1. Firms can choose to focus on ______(1) or _______(2).
2. However, firms do not compete in the whole market, they choose a specific ______(3).
3. A example of focus strategy in fashion ready to wear industry in Vietnam is ______(4). It is
not like the case of _____(5), Zara, UniQlo, or Canifa when they aim at _____(6).
 (3) LEVEL 3 – FUNCTIONAL STRATEGIES
- The strategies used in an org.’s various functional departments to support the competitive strategy.

E17. THESE STRATEGIES ARE IN WHICH LEVEL?

1. Cost Leadership strategy _________________________________________
2. Diversification strategy _________________________________________
3. Marketing strategy _________________________________________
4. Differentiation strategy _________________________________________
5. Stability strategy _________________________________________
6. Human resource strategy _________________________________________
7. Focus strategy _________________________________________
8. Growth strategy _________________________________________
9. Retrenchment strategy _________________________________________
10. Integration strategy _________________________________________
Đáp án bài tập:
E1.
(1) Continuous
(2) Setting
(3) Establishing
(4) Making
(5) 5W1H
E2.
1. Planning sets up the goals as direction and outcomes for other activities
2. Planning establishes coordinated effort
3. Planning reduces uncertainty
4. Planning reduces overlapping and wasteful activities
5. Planning establishes the goals or standards that facilitate control
E3.
(1) Desired
(2) Individuals
(3) Groups
(4) Organization
(5) Direction / Orientation
E4.
1. Real goal of every company is the LONGTERM PROFIT MAXIMIZATION
2. Because:
- Stated goals convince and persuade stakeholders (both internal and external).
- Stated goals increase brand loyalty.
E5.
1. I will get grade A of 8.5 in Principles of Management in the end of this semester 19-20.
2. Our company will have the biggest market share of 51% in Vietnam market by 2022.
3. Answer FAQs of customes within 3 minutes.
E6.
None of them is better because each one fits in different situations:
Traditional goal setting MBO goal setting
 Downwards decision making:  Combine downwards & upwards decision making
 Top managers set up the goals  Top managers set up the goals
 Employees follow  Employees involve in setting goals
 General goals  Specific goals
 Appropriate when:  Appropriate when:
 X people  Y people
 Make quick decisions  Have time for employees to involve
 Important goals  Operational goals
E7.
(1) Actions (3) Future (5) Organizing (7) Controlling (9) Attract
(2) Ways (4) Process (6) Leading (8) Compete
E8. The first step is the most important because it provides the platform and direction for the following step.
E9.
- Concentration growth: 1
 - Related diversification: 2, 3, 4, 7, 8
- Unrelated diversification: 5
- Vertical integration: 6
- Horizontal integration: 9, 1
E10.
(1) Stable (3) Weaknesses (5) Weak (7) Threats (9) Diversification
(2) Strengths (4) Opportunities (6) Strengths (8) Size
E11.
(1) Threats (3) Downsize (5) Reduce
(2) Weak (4) Branches
E12.
1. This company is the biggest one (market share)
2. This company and the biggest rival share the biggest market share
3. This company is not the biggest one in the market. The smaller to 1, the smaller market share the
company has.
4. You can see the figure:

E13.
1. Business level
2. Cost and Differentiation
3. Value chain model: 10đ
4. Design; R&D or technology development (IOS); Cost: outsource assembly in China to save cost
E14.
(1) Competitive (3) Industry (5) Reduce (7) Walmart
(2) Lowest (4) Customers (6) Efficiency
E15.
(1) Unique (3) Cost (5) Customers
(2) Special/ Differentiative (4) R&D (6) Apple
E16. (1) Cost-leadership (2) Differentiation (3) Segment
(4) Ivy Moda/ 7 AM/ Elise/ Viettien/ May 10/Owen,… (5) H&M (6) Everyone/all
E17.
Corporate level: 2, 5, 8, 9, 10
Business level (competitive): 1, 4, 7
Functional level: 3, 6
 CHAPTER 7. ORGANIZING

NỘI DUNG KIẾN THỨC

5. Definitions
- Organizing
- Organizing structure (O.S)
6. Designing the O.S.
- Division of labor
- Departmentalization
- Chain of command
- Span of control
- Centralization or Decentralization
- Formalization
7. Contemporary O.S

CHI TIẾT BÀI GIẢNG VÀ BÀI TẬP TRÊN LỚP

3. DEFINITIONS
d. Organizing
e. Organization structure (O.S)

E1. FILL IN THE BLANK

3. Organizing is a ______(1) of _____ (2) and _____ (3) resources and designing organizational
______ (4) to achieve the goals.
4. Organizational Structure (O.S) is an ______ (5) framework in which ______ (6) within the
organization are divided and ______ (7).

4. DESIGNING THE ORGANIZATION STRUCTURE (O.S)

e. Division of labor / Work specialization
- First defined by Adam Smith (1776) in “The Wealth of Nations”
- Dividing work activities into separate jobs / tasks
- Main advantages: Economies of specialization
o Increased productivity
o Staffs are more skilled and capable due to repeatly doing one task
- Disadvantages: Human diseconomies in the long run
o Boredom, fatigue, stress, low productivity, poor quality, increased absenteeism, high turnover
o Staffs cannot develop their abilities or explore their potential
f. Departmentalization
- Definition: Departmentalization is how JOBS are GROUPED TOGETHER
- Five types of deparmentalization
+ Functional Departmentalization: Grouping activities by functions performed
+ Product Departmentalization: Grouping activities by major product areas
+ Customer Departmentalization: Grouping activities by customer
+ Geographic Departmentalization: Grouping activities on the basis of geography or territory.
+ Process Departmentalization: Grouping activities on the basis of work or customer flow.
- Cross-functional Teams: Teams made up of individuals from various departments and that cross
traditional departmental lines.
- Matrix structure: A structure in which specialists from different functional departments are
assigned to work on projects led by a project manager.

E2. FIND THE NAME OF THE FOLLOWING STRUCTURES

Figure 1. _______________________

Figure 2. _______________________

Figure 3. _______________________

Figure 4. _______________________

Figure 5. _______________________

Figure 6. _______________________
 E3. ANSWER THE FOLLOWING QUESTIONS BASED ON EXERCISE 2
4. Which type is suitable for Vietnamese SMEs? Why.
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________

5. Which types is suitable for big corporations? Why?

____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________

g. Chain of command
- Chain of Command: The line of authority extending from upper organizational levels to lower
levels, which clarifies who reports to whom.
- Authority: The rights inherent in a managerial position to give orders and expect the orders to be
obeyed.
- Responsibility: An obligation to perform assigned duties.
- Line authority entitles a manager to direct the work of an employee.
It is the employer–employee authority relationship that extends from the top of the organization to
the lowest echelon.
- As organizations get larger and more complex, line managers find that they do not have the time,
expertise, or resources to get their jobs done effectively.
In response, they create staff authority functions to support, assist, advice, and generally reduce
some of their informational burdens.

E4. FILL IN THE BLANKS

1. Chain of command is an authority _______(1) which starts from the _____(2) level and
comes to the _____(3) level within an organization.
2. In a chain of command, the relationship of report is described and there are 2 items:
_______(4) and ______(5) for each position.
3. Line authority refers to the relationship of _____(6) while staff authority refers to the
relationship of _______(7)
4. There are 2 principles to design the chain of command including: ________(8) and
_______(9).
h. Span of control
- Is the number of employees that a manager can efficiently and effectively supervise
- A manager with a large S.O.C has a lot of people under him.
The smaller a manager’s S.O.C, the less subordinates he can lead.
- The span of control always involves two dimensions:
o Horizontal dimension: the number of direct subordinates a manager actually supervises
o Vertical dimension: the number of levels that are (in)directly managed.
- A large Span of Control leads to a flatter organisational structure, which results in lower costs.
- A small span of control creates a steeper organisational structure, which requires more managers
and which will consequently be more expensive for the organisation.

E5. ANALYZE TWO OPTIONS BELOW AND GIVE RECOMMENDATION

• A company has 4096 non managerial employees. The CEO is thinking of 2 options:
 Option 1: Span of control is 4
 Option 2: Span of control is 8
•The jobs are simple and familiar.
____________________________________________________________________________
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____________________________________________________________________________
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 E6. FILL IN THE BLANK AND ANSWER THE QUESTIONS
1. This concept refers to the ____ (1) of employees that a manager can control ______ (2) and
______ (3).
2. Span of control can be large or small depending on many factors. What are those factors?
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________

3. If the jobs are new and complicated, span of control should be large or small? Why?
____________________________________________________________________________
____________________________________________________________________________

4. If the employees are Y people, span of control should be large or small? Why?
____________________________________________________________________________
____________________________________________________________________________

5. If jobs are easy and familiar, span of control should be large or small? Why?
____________________________________________________________________________
____________________________________________________________________________

i. Centralization or Decentralization
- Centralization
o Top managers hold the power in their hands
o Centralization is the degree to which decision making takes place at upper levels of the
organization.
- Decentralization
o Lower level managers have or involve in decision making
o Decentralization is the degree to which lower-level managers provide input or actually
make decisions.
- The two concepts is linked to traditional and MBO goal setting
o None of them is better
o However, many firms today want to develop the flexibility and apply decentralization
j. Formalization
- Formalization refers to how standardized an organization’s jobs are and the extent to which
employee behavior is guided by rules and procedures.
- Example: In Japanese firm, there are many rules such as choosing clothes, not taking phone to
work, etc.
- It depends whether high or low formalization is better.
6. CONTEMPORARY ORGANIZATIONAL STRUCTURE

E7. ANSWER THE QUESTIONS

1. Which structure is this in the attached picture? Why is called with this name?
____________________________________________________________________________
____________________________________________________________________________
2. This structure breaks a principle of organizing. Which principle is this?
____________________________________________________________________________
Đáp án bài tập:
E1.
(1) process (3) coordinating (5) official (7) grouped
(2) allocating (4) structure (6) jobs
E2.
Fig.1. Functional Fig.3. Geographic Fig.5. Customer
Fig.2. Product Fig.4. Process Fig.6. Cross-functional
E3.
1. Vietnamese SMEs suit the Functional departmentalization structure because:
- SMEs have limited capital and number of employees
- They do not have wide product ranges or branches
- They can have efficiency from putting together similar specialties and people
- They can coordinate well within functional areas
- They can have in-depth specialization
2. Big corporation suit the Product, Geographic, Customers and Cross functional structures.
Because they have wide product ranges or branches or customers and many projects or SBUs.
E4.
(1) Line (4) Authority (7) Support/assistant/cooperation
(2) Top/highest (5) Responsibility (8) Unity of command
(3) Bottom/lowest (6) Direction (9) Acceptance of authority
E5.

 Option 1:
 1 manager controls 4 employees
 6 levels of management
 1365 managers
 Option 2:
 1 manager controls 8 employees
 4 levels of management
 585 managers

ANALYSIS
 Option 1: Because there are more levels of management and more managers, so:
 The organizational structure is more complicated and power distance is further.
 Higher costs for payment to the managers
 But also higher level of control
 Option 2: Because there are fewer levels of management and managers, so
 The organization structure is simpler and power distance is nearer
 Lower costs for payment to the managers
RECOMMENDATION
 Since it is stated that the jobs are simple and familiar  Employees can do it themselves
 So option 2 is more beneficial  Should choose option 2
E6.
1. (1) number (2) efficiently (3) effectively
 2. S.O.C can be large or small, depending on 6 main factors:
(1) Abilities of managers
(2) Abilities of employees
(3) Nature of the jobs: similarity – complexity – standardization
(4) Technology
(5) Organization culture
(6) Leadership
3. If the jobs are new and complicated:
Small S.O.C  Managers can instruct and control closely to ensure the jobs are well done
4. If the employees are Y people:
Large S.O.C  Because according to Theory Y, employees are highly capable, need litle supervision and
can be left on their own
 The employees have the ability and responsibility to do the jobs.
5. If the jobs are easy and similar:
Large S.O.C  Because employees can do the jobs themselves.
E7.
1. Matrix Organizational Structure as there is it is a mix of the functional organizational structure and the
projectized organizational structure.
2. The principle of unity of command
 CHAPTER 8. MOTIVATION

NỘI DUNG KIẾN THỨC

8. Definitions
9. Types of motivation
10. Benefits of motivation
11. Motivation theories
- Maslow’s Hierachy of Needs
- Alderfer’s ERG Theory
- McClelland’s 3-need Theory
- Herzberg’s 2-factor Theory
- McGregor’s Theory X and Y
- Adams’s Equity Theory
- Vroom’s Expectancy Theory

CHI TIẾT BÀI GIẢNG VÀ BÀI TẬP TRÊN LỚP

5. DEFINITION

E1. FILL IN THE BLANK

Motivation is a _____ (1) in which individual _____ (2) are energized, ______ (3) and reinforced.

6. TYPES OF MOTIVATION
- There are 2 types of motivation:
+ Intrinsic motivation—are related to job satisfaction
—motivated by internal desire for its own sake
E.g. Staying longer at work because you believe in your work.
+ Extrinsic motivation—are associated with job satisfaction
—motivated by external factors (rewards/ avoid unexpected outcome)
E.g. Working extra hard because you want to become the employee of the month.
- Work motivation
- Motivation formula: P=M*A*O

E2. FILL IN THE BLANK

1. Work motivation includes ______ (1) of behaviors, level of _____ (2) and level of ______ (3).
2. According to researchers,_______ (1) + ______ (2) = Outputs
3. According to other researchers, P=M*A*O. What each letter stands for?
__________________________________________________________________________
__________________________________________________________________________

7. BENEFITS OF MOTIVATION
- For individuals: Motivated  Higher performance and productivity  Promotion, higher salary
- For managers: Motivating staffs  Higher team performance + Good relationships with members
 Build a dynamic and strong team
- For organizations: Motivation  High productivity and performance
 Strong, committed workforce (contribution, engagement, loyalty)
8. MOTIVATION THEORIES
a. HIERARCHY OF NEEDS (Maslow)
- Needs appear one by one, from lower to higher.
- When a need is fulfilled, it is no longer a motivator.
- Drawback of this theory:
o It implies that higher needs will not appear if
lower needs are not satisfied.
o In fact, sometimes higher need may appear
even when lower needs are not satisfied.
o Example: A war journalist risked his life (safety)
for truth and humanity (self-actualization).

E3. FILL ONE WORD IN THE BLANK.

5. For Maslow, needs appear one by one from the _____ (1) to the ______ (2).
6. For Maslow, when a need is satisfied, it is no longer a _______ (3).

E4. FOR MASLOW, WHICH NEED IS THIS?

1. Mary wants to get married. _______________________
2. Peter wants to buy insurance. _______________________
3. Paul wants to have good marks. _______________________
4. David wants to take a nap. _______________________
5. Daisy wants to be promoted. _______________________
6. Britney wants to have more power. _______________________
7. Tom wants to have good relationship. _______________________
8. Hannah wants to buy a new house in a low criminal area. _______________________
9. Andrew wants to improve his skills and ability. _______________________
10. Lana wants to have lunch. _______________________

b. ERG THEORY (Alderfer)

- ERG Theory fixes the aforementioned drawback by
categorizing the hierarchy into 3 types of need:
o E – Existence needs: Physiological + Safety
o R – Relatedness needs: Social + Extrinsic Esteem
o G – Growth needs: Intrinsic Esteem + Self-
actualization
- More than one need can appear simultaneously.
- If the fulfillment of a higher-level need is subdued,
there is an increase in desire for satisfying a lower-
level need.
 E5. COMPARE HIERARCHY OF NEEDS AND ERG THEORY
HIERARCHY OF NEEDS ERG THEORY
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________
____________________________________ ____________________________________

c. 3-NEED THEORY (McClelland)

Self- Needs for Archievement (nArch)
actualization

Esteem Needs for Power (nPow)

Social Needs for Affliation (nAff)

Safety

Physiology

- People with high nPow get promotion quickly.

- People with high nArch have good performance.
- People with high nAff have good relationship.

d. 2-FACTOR THEORY (Herzberg)

- Herzberg’s two-factor theory proposes that:
+ Intrinsic factors are related to job
satisfaction
+ Extrinsic factors are associated with job
dissatisfaction
- Hygiene Factors: Factors that eliminate job
dissatisfaction but don’t motivate.
- Motivators: Factors that increase job
satisfaction and motivation
 Maslow’s Hierachy of Alderfer’s ERG Theory McClelland’s Three-Need Herzgerb’s Two-Factor
Needs Theory Theory
Self-Actualization Need for Achievement Motivators
Growth needs (nAch)
Relatedness need
Esteem Need for Power (nPow)
Social Need for Affiliation (nAff) Hygiene factors
Safety Existence needs
Physiological

E6. WHICH IS INCLUDED IN HYGIENE FACTORS AND MOTIVATORS?

1. Salary _______________________
2. Relationship with co-workers _______________________
3. Recognition _______________________
4. Security _______________________
5. Promotion _______________________
6. Canteen _______________________
7. Responsibility _______________________
8. Improvement _______________________
9. Insurance _______________________
10. Working hours _______________________

E7. FILL IN THE BLANKS

1. If Hygiene factors are NOT provided, employees will feel _______.
2. If Hygiene factors are provided, employees will feel _______.
3. If Motivators are NOT provided, employees will feel _______.
4. If Motivators are provided, employees will feel _______.

e. THEORY X AND Y (McGregor)

- Theory X is a negative view of people
that assumes workers have little ambition,
dislike work, want to avoid responsibility,
and need to be closely controlled to work
effectively.
- Theory Y is a positive view that
assumes employees enjoy work, seek out
and accept responsibility, and exercise self-
direction.
f. EQUITY THEORY (Stacey Adams)
- People often compare what they get from a
job (outcomes) in relation to what they put
into it (inputs); and then compare their
inputs-outcomes ratio with that of the
relevant others.

E8. WHICH IS INCLUDED IN HYGIENE FACTORS AND MOTIVATORS?

1. According this theory, people often compare what with what?
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________

2. What can motivate people in this theory?

_________________________________________________________________________

3. How many situations can be? What are they?

_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
4. What should managers do to motivate employees?
_________________________________________________________________________

g. EXPECTANCY THEORY (Victor Vroom)

- An individual tends to act in a certain way, based on:
+ The expectation that the act will be followed by a given outcome
+ The attractiveness of that outcome to the individual
- People often expect 2 things:
+ Effort  Specific performance
+ With that performance  Attractive rewards
- The Expectancy model includes three variables or relationships:

(1) Expectancy or Effort-Performance linkage is the probability perceived by the individual that
exerting a given amount of effort will lead to a certain level of performance.
(2) Instrumentality or Performance-Reward linkage is the degree to which the individual believes
that performing at a particular level is instrumental in attaining the desired outcome.
 (3) Valence or attractiveness of reward is the importance that the individual places on the potential
outcome or reward that can be achieved on the job. Valence considers both the goals and needs
of the individual.
- Motivation Force = Valence x Instrumentality x Expectancy
(MF) (V) (I) (E)

E9. WHICH IS INCLUDED IN HYGIENE FACTORS AND MOTIVATORS?

1. According to this theory, a person tries his/her best to do something because he/she
expects what?
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
2. What can motive people according to this theory?
_________________________________________________________________________
_________________________________________________________________________
Đáp án bài tập:
E1.
(3) process (2) efforts (3) directed
E2.
1. (1) direction (2) effort (3) persistance
2. (1) motivation (2) performance
3. Performance = Motivation * Ability * Opportunity
E3.
(1) Lower/lowest/bottom
(2) Higher/highest/top
(3) Motivator
E4.
1. Mary wants to get married. � SOCIAL NEEDS.
2. Peter wants to buy insurance. � SAFETY NEEDS
3. Paul wants to have good marks. � SELF-ACTUALIZATION NEEDS
4. David wants to take a nap. � PHISIOLOGICAL NEEDS
5. Daisy wants to be promoted. � ESTEEM NEEDS
6. Britney wants to have more power. � ESTEEM NEEDS
7. Tom wants to have good relationship. . � SOCIAL NEEDS.
8.
9. Andrew wants to improve his skills and ability. � SELF-ACTUALIZATION NEEDS
10. Lana wants to have lunch. � PHISIOLOGICAL NEEDS
E5.
HIERARCHY OF NEEDS ERG THEORY
Both theories talk about needs and motivation
Needs are catergorized into 5 types Needs are categorized into 3 types
 Physiological needs  Existence needs – Including physiological needs
 Safety needs and Safety needs
 Social needs  Relatedness needs – Including Social needs and
 Esteem needs extrinsic components of Esteem needs
 Self-actualization needs  Growth needs – Including intrinsic components of
Esteem needs and Self-actualization needs
Needs appear one by one so that at one moment one Needs can apear more than one at one moment.
person has only one need.

E6.
1. Salary HYGIENE FACTORS
2. Relationship with co-workers HYGIENE FACTORS
3. Recognition MOTIVATORS
4. Security HYGIENE FACTORS
5. Promotion MOTIVATORS
6. Canteen HYGIENE FACTORS
7. Responsibility MOTIVATORS
8. Improvement MOTIVATORS
9. Insurance HYGIENE FACTORS
10. Working hours HYGIENE FACTORS
E7.
1. dissatisfied
2. undissatisfied (OK)
3. undissatisfied (OK)
4. satisfied
E8.
1. Outcomes vs. Inputs
Their ratio vs. Others’s ratio
What they give vs. What they get
2. Fairness
3. 3 situations of Inequity (underrewarded), Equity
and Inequity (overrewarded) as in the picture.
4. Give outcomes equal to inputs

E9.
1. There is a positive correlation between efforts and performance (high efforts  high performance).
Favorable performance will result in a desirable reward (High performance will be rewarded).
2. All leaders should know what employees’ expectation to motivate them by providing attractive rewards.
 CHAPTER 9. LEADERSHIP

NỘI DUNG KIẾN THỨC

1. Overview
- Definitions
- Leadership activities
- Power
2. Leadership theories
- Trait approaches
- Behavioral approaches
+ Iowa Uni. – Autocratic / Democratic / Laissez-faire
+ Michigan Uni. – Production-oriented / Employee-oriented
+ Ohio State Uni. – Initiating structure / Consideration
+ Managerial Grid
- Situational approaches
+ Contigency Theory
+ Path-Goal Theory
+ SLT
- Contemporary approaches
+ Visionary
+ Charismatic
+ Transactional
+ Transformational

CHI TIẾT BÀI GIẢNG VÀ BÀI TẬP TRÊN LỚP

9. OVERVIEW
a. DEFINITION
- Leader is someone who can influence others and who has
managerial authority.
- Leadership is a process of influencing a group of people to
achieve the goals.
- Difference between Management and Leadership:
+ A manager: Needs to base on the formal position in a
hierarchy of organization. The higher the position is, the
more power he/she has.
+ A leader: Does not need to base on the formal position in
an organization. Their power to influence others results
from their traits, characteristics, behavior, etc.
b. LEADERSHIP ACTIVITIES
- Coach, train and instruct employees
- Create vision and orient /direct activities towards the goals
- Motivate employees
- Deal with conflict
- Build a positive working environment
c. POWER
- Definitions:
+ Power refers to an individual’s capacity to influence decisions.
+ Authority is part of the larger concept of power.
- Types of power:
+ Position power: Reward power / Coercive power / Legitimate power
+ Personal power: Referent power / Expert power

E1. FILL IN THE BLANK

1. Leadership is a ________ (1) of ________ (2) a group of ________ (3) to achieve the goals.
2. Power is the _________ (4) of an ___________ (5) to __________ (6) decisions.

E2. WHICH IS INCLUDED IN LEADERSHIP?

 Motivating employees
 Creating vision and orientation
 Formulating appropriate strategies
 Communicating to solve the conflict
 Coaching, supporting, training, instructing employees
 Building a positive working environment.
 Supervising employees.
 Evaluating performances.
 Dividing power and authority.
 Designing organizational structure.

E3. WHICH TYPE OF POWER IS THIS?

1. The leader can punish followers. _____________________
2. The leader can be a lawyer who gives advice. _____________________
3. The leader can be a secretary of the boss, so followers may _____________________
be influenced because the secretary can tell the boss.
4. The leader can give follower promotion. _____________________
5. A policeman can have influence on people because they are _____________________
afraid of him if you make mistakes.
6. The leader has the gift that followers want to have. _____________________
7. The leader bases on the fear of followers. _____________________
8. The leader has experiences and skills that followers admire. _____________________
9. The leader has a good identification in the mind of follower. _____________________
10. The leader has high position in the hierarchy of the company. _____________________
10. LEADERSHIP THEORIES
h. TRAIT APPROACHES (1900s)
- Leaders are in-born and there are characteristics (traits) that differentiate leaders from nonleaders.
- Tools to identify leaders by traits: Big 5-trait model, MBTI test
- Theories: Great Man theories
- The seven traits shown to be associated with effective leadership:

i. BEHAVIORAL APPROACHES
Including theories that isolate behaviors that differentiate effective leaders from ineffective leaders.

(1) IOWA UNIVERSITY STUDIES

- Autocratic Style: A leader who centralizes authority, dictates work methods, makes unilateral
decisions, and limits employee participation
- Democratic Style: A leader who involves employees in decision making, delegates authority,
encourages participation in deciding work methods, and uses feedback to coach employees
- Laissez-Faire Style: A leader who generally gives employees complete freedom to make decisions
and to complete their work however they see fit

E4. COMPLETE THE TABLE

Autocratic Democratic Laissez-Faire

Make decision
Use power
Supervise followers
Require followers
 E5. WHICH IS THE BEST LEADERSHIP STYLE ACCORDING TO STUDIES OF THE IOWA UNI?
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________

(2) MICHIGAN UNIVERSITY STUDIES

- Employee Oriented: A leader who emphasizes the people aspects.
- Production Oriented: A leader who emphasizes the technical or task aspects.

E6. WHICH IS THE BEST LEADERSHIP STYLE ACCORDING TO STUDIES OF THE IOWA UNI?
1. For production oriented, leaders consider followers as the _____ (1) to achieve the goals.
Leaders care about ______ (2) aspects of the jobs such as ____ (3) and _____ (4). For them,
_______ (5) is important.
2. For employee oriented, leaders care about _______ (6) with followers. Leaders want to
understand _____ (7) and _____ (8) of followers. They accept individual ____ (9). They want
to have ______ (10) and _______ (11) of followers.

E7. WHICH IS THE BEST LEADERSHIP STYLE ACCORDING TO STUDIES OF THE MICHIGAN UNI?
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________

(3) OHIO STATE UNIVERSITY STUDIES

- Initiating Structure: The extent to which a leader defines and structures his or her role and the
roles of employees to attain goals
- Consideration: The extent to which a leader has job relationships characterized by mutual trust,
respect for employees’ ideas, and regard for their feelings

(4) MANAGERIAL GRID

- [1, 1] Impoverished Management
 Exertion of minimum effort to get required work done
- [1,9] Country Club Management
 Attention to needs of people
 Comfortable, friendly atmosphere and tempo
- [5,5] Middle of the Road Management
 Balance need to get work out with maintaining morale
at satisfactory level
- [9,1] Task / Authority-Obedience Management
 Efficiency in operation
 Minimum interference of human elements
- [9,9] Team Management
 Accomplish work through committed people
 Common stake in organizational purpose
 E8. ANSWER THE QUESTIONS
1. The behaviors of Managerial Grid based on the ideas of which previous studies?
__________________________________________________________________________
2. How many leadership styles in Managerial Grid?
__________________________________________________________________________
__________________________________________________________________________
3. Which is the best leadership style in Managerial Grid? Why?
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________

j. SITUATIONAL APPROACHES
(1) CONTIGENCY THEORY
(2) PATH-GOAL THEORY
(3) SITUATIONAL LEADERSHIP THEORY (SLT) – Hershey and Blanchard
- A leadership contingency theory that focuses on followers’ readiness.
Readiness = Extent to which people have the ability and willingness to accomplish a specific task.
- 2 variables: Willingness and Ability
- Combine 2 variables, we have 4 types of situation and 4 leadership styles applied.

S1 = Telling - Defines roles and tells people what, how,

R1 = Not willing + Not able 
when, where to do various tasks
R2 = Willing + Not able  S2 = Selling - Provides directive and supportive behavior
S3 = Participating - Shared in decision making; leaders’
R3 = Not willing + Able 
main role is facilitating and communicating.
R4 = Willing + Able  S4 = Delegating - Provides little direction or support.
 E9. CHOOSE A LEADERSHIP STYLE (TELLING, SELLING, PARTICIPATING, DELEGATING) FOR EACH
SITUATION OF R1, R2, R3, R4 AND EXPLAIN WHY.
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________

E10. CHOOSE THE SUITABLE LEADERSHIP STYLE FOR THE FOLLOWING SITUATIONS AND
EXPLAIN WHY.
a) Mrs. Hoa has been working for the company for 10 years with experience in accounting.
However, she is tough-minded and uncooperative.
__________________________________________________________________________
b) Mr. Binh has been working for the company for 15 years. He is very friendly and helpful. He
shares his knowledge to his peers.
__________________________________________________________________________
c) Mr. Tuan is lazy and irresponsible. He often makes mistakes when doing tasks.
__________________________________________________________________________
d) Miss. Lan has graduated and been recruited recently. She is very enthusiastic, but does not
know much about the job.
__________________________________________________________________________

k. CONTEMPORARY APPROACHES
(1) VISIONARY LEADERSHIP

Example: Why many American voted for Donald Trump to be the President?

Answer:
The main reason is that he has a good vision to influence on Americans at that time. He stated the goal
of “Making America Great Again”. During that time, many Americans thought that US was losing its
position in the world, so they advocated Trump with view to backing their position in the world.
(2) CHARISMATIC LEADERSHIP
This is the gift.
(3) TRANSACTIONAL LEADERSHIP
- Transactional = Exchanging
- Example: If the followers work effortfully and effectively, the leader will reward them with
promotion.
(4) TRANSFORMATIONAL LEADERSHIP
- The leader can transform the followers from duck to swan, from zero to hero
- To do that, the leader needs to be sensitive and good enough to transform / change / develop his
own followers.
- Rules of 4Is:
+ Idealized influence
+ Inspirational motivation
+ Intellectual stimulation
+ Individual consideration
Đáp án bài tập:
E1.
(1) Process (2) influencing (3) people (4) capacity (5) individual (6) influence
E2.
1, 2, 4, 5, 6
E3.
Reward: 4, 6
Coercive: 1, 3, 5, 7
Expert: 2, 8
Referent: 9
Legitimate: 10
E4.
Autocratic Democratic Laissez-Faire
Make decision Leaders Leaders and Followers
followers
Use power Centralization Decentralization Empower
Supervise followers Strictly By using feedback Results/outcomes
Require followers Obey Involve Be
active/responsible
E5.
None of them is the best. It is based on:
- Emergency, curgency: Quick decision  Autocratic
- Types of people (X or Y): X people  Autocratic
- Expectation of leaders
- Fields: Autocratic: in military; Laissez-Faire: in art
E6.
(1) Tools (2) technical (3) methods (4) structure
(5) Productivity (6) relationships (7) needs (8) wants
(9) Differences (10) loyalty (11) engagement
E7.
Employee-orientation.
Because:
- Higher group productivity
- Higher job satisfaction
E8.
E9.
E10.