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Chapter 1: Understanding the Manager’s Job 2
Copyright © Cengage Learning. All rights reserved.
Teaching Tip: Note the similarities and differences among the kinds of resources used by profit-
seeking and not-for-profit organizations. For example, both an airline and a university may buy food in
bulk, but they have different revenue sources to pay for that food.
Group Exercise: A good icebreaking exercise for the first day of class is to have students form into
small groups, select two or three different kinds of organizations, and identify examples of the different
kinds of resources they use.
Efficient means using resources wisely and in a cost-effective way. Effective means making the
right decisions and successfully implementing them.
A. Kinds of Managers
1. Managers at different levels of the organization
a) Top managers are the small group of executives who control the organization by
setting its goals, overall strategy, and operating policies. Top managers also
represent the organization to the external environment. Job titles for top managers
include CEO, president, and vice president.
Management Update: While CEO salaries have risen over the years, they have been affected by the
economic downturn. The average salary for S&P 500 company CEOs was $11.4 million in 2009, a 11%
cut over 2008. The decline was starker in 2012, where the average salary was $9.6 million, while it
increased to $14.1 million in 2013.
b) Middle managers are the largest group of managers in most companies. These
managers hold positions such as plant manager, operations manager, and division
head. They primarily take the goals and strategies designed by top managers and
put them into effect. They supervise lower-level managers.
c) First-line managers supervise and coordinate the activities of operating
employees. They often have job titles such as foreman, supervisor, and office
manager. The majority of their work is direct supervision of their subordinates.
2. Areas of management
a) Marketing managers work in areas related to the marketing function of the
organization. They help to find ways to get consumers and clients to buy the
organization’s products.
Discussion Starter: Point out for students that their major will play a large role in determining the area
of management they enter after graduation (assuming that they go to work for a large organization). For
example, a marketing major’s first job is likely to be a first-line management position in the marketing
function, whereas a finance major will more likely start out as a first-line financial manager.
b) Financial managers deal primarily with an organization’s financial resources and
are involved in such activities as accounting, cash management, and investments.
c) Operations managers are concerned with creating and managing the systems that
create an organization’s products and services. They achieve their goals through
production control, inventory control, quality control, and plant site selection and
layout.
d) Human resource managers are responsible for hiring and developing employees.
They are concerned with the flow of employees into the organization, through the
organization, and out of the organization.
e) General managers are generalists who have some basic familiarity with all
functional areas of management rather than specialized training in any one area.
f) Specialized types of managers include those who work in public relations, R&D,
internal consulting, and international business.

Discussion Starter: Ask students to identify additional examples of managers, with an emphasis on as
many different kinds of organizations and management positions as possible. The wide variety of
answers that is likely to emerge can be used to stress the diversity that exists in managerial work.
B. Bas
The
decision making, organizing, leading, and controlling.
Extra Example: Richard Parsons, the former CEO of Time Warner, can be used to illustrate the basic
management functions. He planned how the firm will increase the value of its stock. He fostered an
organization design that helped to better integrate the firm’s many business units. He had a reputation
for being well liked, thanks to his self-deprecating sense of humor. He continually monitored the firm’s
progress toward its goals.
1.
2.
Planning and decision making determine courses of action. Planning means setting an
organization’s goals and deciding how best to achieve them. Decision making, a part of
the planning process, involves selecting a course of action from a set of alternatives.
Organizing is grouping activities and resources.
Management Update: The most significant trend in organizing today is the elimination of
management layers to create organizations that are leaner and flatter.
3.
4.
Leading is the set of processes used to get people to work together to further the
interests of the organization.
Controlling is monitoring the progress of the organization as it works toward its goals
to ensure that it is effectively and efficiently achieving these goals.
C. Fundamental Management Skills
Management Update: In recent years, there has been a renewed interest in the concept of managerial
skills. There are useful self-assessment skills exercises found at the end of each chapter in this book.
1. Technical skills are necessary to accomplish or understand tasks relevant to the
organization.
Extra Example: When Louis Gerstner was appointed as CEO of IBM, some critics argued that he
knew nothing about computers. However, he silenced his critics by immersing himself in the study of
new technology and soon became a knowledgeable expert.
2.
3.
4.
5.
Interpersonal skills rely on the ability to communicate with, understand, and motivate
individuals and groups.
Conceptual skills include the ability to think in abstract terms and the mental capacity
to understand the “big picture” or the overall workings of the organization and its
environment.
Diagnostic skills consist of the ability to recognize the symptoms of a problem and
then determine an action plan to fix it.
Communication skills are abilities to effectively convey ideas and information to others
and effectively receive ideas and information from others.
Extra Example: Bill Ford, the former CEO and chairman of Ford Motors, is known for his ability to
effectively convey a vision of the firm’s future to both workers and investors.
6. Decision-making skills include the ability to correctly recognize and define problems
and opportunities and to then select an appropriate course of action to solve problems
and capitalize on opportunities.
7. Time management skills are abilities such as prioritizing work, working efficiently, and
delegating appropriately.

Extra Example: One of the criticisms of Martha Stewart, head of Living Omnimedia, is that she has a
hard time delegating tasks to her subordinates and becomes personally involved in too many decisions.
Stewart, however, responds that her attention to detail is an important factor in her success.
D. The Science and the Art of Management
1. Management is partly a science, because some aspects of management are objective
and can be approached with rationality and logic.
Discussion Starter: The science of management might be analogous to the activities of developing
computer hardware or playing a violin. There are specific right and wrong ways of doing things, and
mistakes are easily noted.
2. Management is partly an art, because some aspects of management are subjective and
are based on intuition and experience.
Discussion Starter: The art of management might be analogous to the activities of writing computer
software or conducting the orchestra. More intuition and “feel” are needed to complete these activities,
and mistakes may be harder to pinpoint.
II. The Evolution of Management
A. The Importance of History and Theory
Teaching Tip: Many students seem to react negatively to the concept of a “theory.” Ask for student
opinions about the reasons for the popularity or lack of popularity of a particularly high-profile
politician (such as the president) or other public figure (such as a sports figure or movie star). Then
point out that their explanation is a theory. Go on to stress the point that theories are simply frameworks
of thought and that most people hold a number of different theories.
1. Why theory? Theory provides a simple conceptual framework for organizing
knowledge and providing a blueprint to help organizations achieve their goals.
Management Update: Andrew Grove continued to espouse his theory of organizations at Intel until his
retirement. He gave the theory credit for Intel’s continued success in the semiconductor business.
2. Why history? Contributions from past industrialists have molded the American culture,
and managers can benefit from an awareness of these contributions.
Interesting Quote: “Business history lets us look at what we did right and, more important, it can help
us be right the next time.” (Alfred Chandler, Harvard Business School professor, Audacity, Fall 1992, p.
15.)
Discussion Starter: Ask students if they have read any books about history that may help them be
better managers.
B. The
While the practice of management can be traced back thousands of years, it was not given
serious attention until the 1800s, when large organizations emerged.
Global Connection: Many Japanese executives today give some of the credit for their success to a
book written in 1645. The book, entitled A Book of Five Rings, was written by a samurai warrior. The
book describes numerous ideas and concepts for successful competition that can be generalized to
management.

Discussion Starter: Ask students to think about social, economic, and political forces today that may
shape the way business will be conducted in the future. How can managers better anticipate these
changes?
C. The Classical Management Perspective
The classical management perspective includes two approaches: scientific management and
administrative management.
1. Scientific management focuses on ways to improve the performance of individual
workers.
a) Frederick W. Taylor saw workers soldiering, or deliberately working beneath
their potential. He divided each job into parts and determined how much time
each part of the job should take, thus indicating what each worker should be
producing. He designed the most efficient way of doing each part of the job, and
instituted a piecework pay system with incentives for workers who met or
exceeded the target output level.
Discussion Starter: Ask students if they have ever observed soldiering. Ask them if they have ever
been “guilty” of such behavior themselves.
Extra Example: Frederick Taylor applied many of the concepts of scientific management to his
favorite sports, lawn tennis and croquet.
b) Frank and Lillian Gilbreth, a husband-and-wife team, also helped to find more
efficient ways for workers to produce output.
Discussion Starter: Ask students to discuss or debate the merits of time-and-motion studies and other
efficiency techniques.
Extra Example: Another area in which Frank and Lillian Gilbreth made substantial contributions was
in assisting the handicapped. In particular, they helped develop vocational training methods for
assisting disabled veterans.
Extra Example: Other businesses today that rely heavily on scientific management concepts include
poultry processing plants and recycling centers that sort glass, plastics, and papers into different
categories.2. Administrative management focuses on managing the total organization.
a) Henri Fayol was the first to identify the four management functions—planning,
organizing, leading, and controlling—and he developed guidelines for managers
to follow. These guidelines form fourteen principles for effective management.
Discussion Starter: Ask students to discuss the relevance of each of Fayol’s principles to modern
management.
b) Lyndall Urwick is best known for integrating scientific management with
administrative management.
c) Max Weber outlined the concept of bureaucracy based on a rational set of
guidelines for structuring organizations in the most efficient manner. His work is
the foundation of contemporary organization theory.
Global Connection: Note the influence of foreign scholars. For example, Fayol was French, Urwick
was British, and Weber was German.

3. Assessment of the classical perspective
a) Contributions of the classical perspective are that it laid the foundation for
management theory; it identified key processes, functions, and skills that are still
important today; and it made management a valid subject of scientific inquiry.
b) Limitations include that it is not well suited for complex or dynamic
organizations, it provided universal procedures that are not appropriate in all
settings, and it viewed employees as tools rather than resources.
D. The Behavioral Management Perspective
The behavioral management perspective placed more emphasis on individual attitudes and
behaviors and on group and behavioral processes. Hugo Munsterberg and Mary Parker
Follett were early contributors to this perspective.
Global Connection: Again, note the international influence on management, as evidenced by Hugo
Munsterberg, a German psychologist.
1. The Hawthorne studies
Discussion Starter: Ask students if they have ever been in a group that deliberately limited its
productivity or output.
a)
b)
The Hawthorne studies, performed by Elton Mayo, showed that when
illumination was increased, productivity increased. However, productivity also
increased in a control group, where the lighting did not change. The increase in
productivity was attributed to the fact that the workers were having extra
attention paid to them, maybe for the first time.
Other studies found that employees will not work as fast as they can when being
paid piecework wages. Instead, they will perform to the level informally set by
the group in order to be accepted by the group. These two studies, and others, led
Mayo to the conclusion that individual and social processes played a major role
in shaping employee attitudes and behavior at work.
Discussion Starter: Recent evidence suggests that important details about the Hawthorne studies were
not reported properly. For example, all the workers in the illumination study were paid extra for
participating. What, if any, implications might be drawn from this?
2. The
The
on t
improved performance. The movement includes the need theories of motivation, such
as Maslow’s hierarchy of needs and McGregor’s Theory X and Theory Y.
Teaching Tip: Use Table 1.1 from the text to summarize the assumptions of Theory X and Theory Y.
3. Contemporary behavioral science in management
The emergence of organizational behavior occurred because of the too-simplistic
descriptions of work behavior by the human relationists. Organizational behavior
takes a holistic view of behavior, including individual, group, and organization
processes.
4. Assessment of the behavioral perspective
a) Contributions include that it gave insights into interpersonal processes, focused
managerial attention on these processes, and challenged the view of employees as
tools and not resources.

b) Limitations include that prediction is difficult due to the complexity of human
behavior, managers may be reluctant to adopt some of the behavioral concepts,
and contributions may not be communicated to practicing managers in an
understandable form.
E. The Quantitative Management Perspective
The quantitative management perspective focuses on decision making, economic
effectiveness, mathematical models, and the use of computers in organizations. The two
branches of the quantitative perspective are management science and operations
management.
Extra Example: Many business programs today have separate courses in management science and/or
operations management. If your school has either or both courses, identify its number and title for your
students and briefly review their topical coverage (i.e., their course description).
1. Management science
2.
Management science focuses specifically on the development of mathematical models.
These models help organizations to try out various activities with the use of a
computer. Modeling can help managers locate the best way to do things and save
money and time.
Operations management
Operations management is an applied form of management science that helps
organizations develop techniques to produce their products and services more
efficiently.
Extra Example: General Motors uses elaborate management science and operations management
models to determine the optimum number and types of cars to make during a given period of time, what
options to put on them, and so forth.
3. Assessment of the quantitative perspective
a) Contributions include that it developed sophisticated quantitative techniques that
improve decision making, and it increased awareness of complex organizational
processes.
b) Limitations are that it cannot fully explain or predict behavior, that mathematical
sophistication may come at the expense of other important skills, and that the
models may require unrealistic or unfounded assumptions.
III. Contemporary Management Perspectives
A. The Systems Perspective
1. A system is an interrelated set of elements functioning as a whole. An organization as a
system is composed of four elements: inputs (material or human resources),
transformation processes (technological and managerial processes), outputs (products
or services), and feedback (reactions from the environment).
Group Exercise: Break students up into small groups. Have them select an organization and diagram
its inputs, transformation processes, outputs, and feedback mechanisms.
2.
3.
Open systems are systems that interact with their environment. Closed systems do not
interact with their environment.
Subsystems are systems within a broader system. Synergy refers to units that are more
successful working together than working alone. Entropy is the process that leads to
decline.
Teaching Tip: Note the subtle but important distinction between entropy and poor management.

B. The Contingency Perspective
Appropriate managerial behavior depends on the elements of the situation. Universal
perspectives try to identify the “one best way” to manage organizations. The contingency
perspective argues that universal theories cannot be applied to organizations because each is
unique.
Group Exercise: Form small groups of students. Have them identify a problem or opportunity facing a
business or other organization. Then have them identify elements and ideas from the classical,
behavioral, and quantitative perspectives that might be relevant. In addition, ask them to discuss how
systems and contingency perspectives might affect the situation.
C. Contemporary Management Challenges and Opportunities
1. Books written for the popular press, including executive biographies and profiles of
successful companies, are having an important impact on the theory and practice of
management today.
2. Management challenges include the following:
a) Globalization is another significant challenge as managers must reach out across
cultural and national boundaries.
b) There is renewed importance placed on ethics, social responsibility, and
corporate governance.
c) Quality also poses an important challenge, as a basis for competition, improving
customer satisfaction, lowering costs, and increasing productivity.
d) The shift toward a service economy continues to be important, challenging
managers who may be more familiar with manufacturing sectors.
e) The economic recession of 2008-2010 and slow recovery in 2011-2014 pose
many challenges as well as offering some opportunities.
f) Managers must contend with the changing nature of the workplace, including
workforce reductions and expansion.
e) The management of diversity is an important opportunity and challenge,
especially with regard to younger generations of workers.
f) Organizations need more than ever to monitor the environment and change to
keep pace with it.
g) Technological advances, especially in communication, have increased the pace of
work, reduced managers’ available time to consider decisions, and increased the
amount of information managers must process.
END-OF-CHAPTER
Questions for Review
1. What are the three basic levels of management that can be identified in most organizations? How
precise are the lines differentiating these levels? In which of the basic areas do managers work?
Top managers manage the overall organization. They create the organization’s goals, overall
strategy, and operating policies. Middle managers are primarily responsible for implementing the
policies and plans developed by top managers and for supervising and coordinating the activities
of lower-level managers. First-line managers supervise and coordinate the activities of operating
employees. How well defined are the lines differentiating these levels often depends on the type
of organization and its size.
Managers may work in various areas within an organization. Common areas include marketing,
financial, operations, human resources, and administrative.

2. What four basic functions make up the management process? How are they related to one
another?
Planning and decision making, leading, organizing, and controlling are the four basic management
functions. Each is related to and must occur simultaneously with the others. Planning and decision
making are perhaps the most intertwined with the three other functions. For example, managers
must plan and make decisions about how to lead, organize, and control. Another example of an
important interrelationship is how managers must balance the need for control against the need for
autonomy that makes leadership easier.
3. Identify several of the important skills that help managers succeed. Give an example of each. How
might the importance of different skills vary by level and area within an organization?
Managerial skills include technical, interpersonal, conceptual, diagnostic, communication,
decision making, and time management. Technical skills are specialized skills related to a specific
area or a specialized industry. An example is an oil and gas exploration project leader who holds
an engineering degree.
Interpersonal skills are the ability to understand and motivate others. An example is a manager
who knows how to give rewards that will motivate workers.
Conceptual skills consist of abstract and logical thinking that will aid the manager as an innovator
and an integrator. An example is an architect who is able to see what a house will look like from
just studying a blueprint.
Diagnostic skills are the ability to observe the current situation and understand the cause-and-
effect relationships that are leading to success or failure. An example is a manager who recognizes
that productivity is dropping in an area and is able to investigate and isolate the problem.
Communication skills are the ability to give and receive information. An example is a manager
who has the skills needed to plan and run an effective business meeting.
Decision-making skills are the capacity to choose the correct course of action, based on
information. An example is a manager who introduces a new product just at the time when
customers are demanding that product.
Time management skills are the ability to prioritize appropriately and to use time resources
effectively. An example is a manager who spends more time on critical tasks, such as training
workers, and less time on routine tasks, such as reading routine reports.
In a large organization with distinct layers of management, these skills are likely to vary
significantly, but may not be so in smaller organizations where these levels are not distinct.
4. Briefly describe the principles of scientific management and administrative management. What
assumptions do these perspectives make about workers? To what extent are these assumptions still
valid today?
The principles of scientific management and administrative management are founded upon
concerns about efficiency. Scientific management looks at the performance of individual workers
and attempts to improve productivity through measures such as incentive pay systems, optimal
task design, specialized training, and careful selection of the most productive workers.
Administrative management looks at the performance of the organization as a whole and attempts
to improve overall organizational efficiency by utilizing bureaucracy, effective planning, top-
down coordination and control, and so on.
Both scientific management theory and administrative management theory assume that workers
do not like to work, accept responsibility, or change their behavior; that they are motivated only

by money; and that they prefer to be told exactly what to do. One could argue that many of these
assumptions are valid even today.
5. Describe the systems perspective. Why is a business organization considered an open system?
The systems perspective describes an organization as a set of elements that function together as a
whole. The theory looks at the linkages between elements and at the functioning of the system,
from inputs to transformation processes to outputs and feedback. Systems theory also investigates
the interaction of the system with its environment. A business organization has a lot of
interactions with its environment, including the labor force, customers, regulators, and local
communities. Thus a business organization is considered to be an open system because it interacts
with its environment.
Questions for Analysis
1. Recall a recent group project or task in which you have participated. Explain how members of the
group displayed each of the managerial skills.
Clearly, answers will vary. Students should have no trouble thinking of a situation. They should
then describe how technical, interpersonal, conceptual, diagnostic, communication, decision-
making, or time management skills were used in that situation.
2. The text notes that management is both a science and an art. Recall an interaction you have had
with someone at a higher level in an organization (manager, teacher, group leader, or the like). In
that interaction, how did the individual use science? If he or she did not use science, what could
have been done to use science? In that interaction, how did the individual use art? If he or she did
not use art, what could have been done to use art?
Students’ answers will vary, depending on the situation they describe. Examples of the use of
science would include mention of rational, systematic, objective decision making or the use of
quantitative models and scientific approaches to problem solving. Examples of the use of art
would include mention of intuition, experience, instinct or personal insights. Other examples
would include the use of communication or interpersonal skills.
3. Watch a movie that involves an organization of some type. Harry Potter, Avatar, The Avengers,
Flight, and Up in the Air would all be good choices. Identify as many management activities and
skills as you can.
Depending on the movie selected, answers will vary. Students who choose a Harry Potter movie,
for example, will find examples of leading and planning as well as a variety of roles and skills.
4. Young, innovative, or high-tech firms often adopt the strategy of ignoring history or attempting to
do something radically new. In what ways might this strategy help them? In what ways might this
strategy hinder their efforts?
Innovations that are truly radical are the only ones that have the potential to break through
tradition and create something that has a chance of great success. Also, if the new firm is able to
innovate in a way that is valued by consumers, they will attain an advantage over their rivals that
may endure for a long time—a sustainable competitive advantage. On the other hand, willfully
ignoring history increases the chances of repeating an error—for example, of trying a strategy or
creating a product that has already been shown to be a failure or dead end. Also, by ignoring
history, firms reject strategies and techniques that are known to work, and so they risk terrible
failure.
5. Can a manager use tools and techniques from several different perspectives at the same time? For
example, can a manager use both classical and behavioral perspectives? Give an example of a
time when a manager did this and explain how it enabled him or her to be effective.

Managers can and do use multiple tools and techniques at the same time. This is often necessary
to effectively cope with complex, varied situations and persons. Students will give different
examples, but here is one possibility. “When I worked at a fast food restaurant, the manager had
problems with one employee. This employee made mistakes, arrived at work late, and had a poor
attitude. First, the manager tried to use a behavioral approach, where the manager reasoned with
the employee and asked the other employees to use peer pressure to change the problem
employee’s behavior. Next, the manager tried to use needs theories of motivation by threatening
to cut the employee’s pay if the employee continued to create difficulties. Finally, the manager
used scientific management to assign that employee to tasks where politeness, accuracy, and
timeliness were less important, such as cleaning the restrooms and taking out the trash.”
Building Effective Time-Management Skills Exercise
Teaching Tip: Each chapter concludes with three skill-building exercises. These are designed for both
groups and individuals. Some are best done during class, while others are intended to be begun or
completed outside of class.
a. Purpose
This exercise allows students to assess their current time-management skills and to
understand ways to improve in this area.
b. Format
This exercise must be done individually, outside of class. It will take about 20 minutes to
complete. The results may be discussed in class.
c. Exercise Task
1. Visit the web site of Franklin Covey, at www.franklincovey.com. Click on the tab marked
“Effectiveness Zone,” then select “assessment center.” Take the Urgency Analysis Profile.
This short online survey will require you to answer several questions and take about 10
minutes.
2. Look at your profile. Explore the information available there, including the assessment of
your current use of time and the suggestions for how you can improve your time
management.
Covey’s site shows students that they spend time on tasks of four different types: critical but
not urgent, urgent but not critical, critical and urgent, and neither urgent nor critical. Covey
recommends that students spend the most time on tasks that are both critical and urgent, and
that they do not neglect tasks that are critical but not urgent.
3. Think of a task that you regularly perform and that, if you were being perfectly honest, you
could label not urgent and not critical. How much time do you spend on this task? What
might be a more appropriate amount of time? To what tasks could you give some of the time
that you spend on this not urgent and not critical task?
Students’ opinions will vary. Covey’s characterization can be useful because it points out
that too many people spend most of their time on urgent tasks, especially on urgent tasks
that are not critical.
4. What is one thing that you can do today to make better use of your time? Try it, and see if
your time management improves.
Covey’s web site makes few suggestions in this regard (although his books do a very
thorough job of this). Upon reflection, however, students should be able to think of ideas for
better time-management on their own. Remind students that it’s not really a good use of time
to try to eliminate all non-critical, non-urgent tasks. Some of these tasks, such as hanging out

with friends or watching TV, can be relaxing and allow one to return to urgent and critical
tasks with a fresh enthusiasm.
Building Effective Decision-Making Skills Exercise
a. Purpose
This exercise is designed to help students develop their decision-making skills, emphasizing
the importance of system interdependencies in organizations.
b. Format
This exercise is designed so that it can be effective when done individually or in small
groups. Answers could be written or presented to the class for evaluation. It should take less
than a half hour.
c. Follow-up
1. Carefully examine each of the three alternatives under consideration. In what ways
might each alternative impact other parts of the organization?
The option to buy lower-grade materials will require changes in purchasing, but it will
also impact workers, because they will have to work harder to make a good quality
product from inferior materials. It may also have a major impact on sales, if the decline
in quality is recognized by buyers. The layoff option will create anxiety and resentment
in those workers remaining in the firm, and it will probably raise overall wage expense,
because the less skilled workers will not work as efficiently as those who have better
training. The option to purchase new equipment requires the most up-front investment,
but has the greatest potential for cost savings later.
2. Which is the most costly option (in terms of impact in other parts of the organization,
not absolute dollars)? Which is the least costly?
Both layoffs and inferior materials will be very costly for the organization. The use of
inferior materials may be the “most costly,” because it could cause customers to buy
competitors’ products and, eventually, lead to the failure of the firm. The least costly
option is the purchase of new equipment. (See reasons under item 1 above.)
3. What are the primary obstacles that you might face regarding each of the three
alternatives?
The option to use inferior materials may cause dissatisfaction from the workers and
will certainly cause customers’ dissatisfaction, if it is detected. The layoff option will
encounter resistance from workers, and the best, most experienced workers may leave
the company for other employment. The purchase of new equipment will likely
encounter resistance from the CEO or other financial personnel, based on the increase
in up-front costs.
4. Can you think of other alternatives that might accomplish the cost-reduction goal?
Students may suggest cost-cutting ideas, such as better inventory control or improved
use of information systems. They may also suggest a closer integration with suppliers
or use of a less expensive distribution channel. There are possibilities for cost savings
in every functional area of the firm.

Skills Self-Assessment Instrument
Self-Awareness
a. Purpose
This instrument is designed to help students become more self-aware of their possession or
lack of skills generally felt to be required of effective managers. The intent is that students
will use the feedback from this self-assessment to focus better on the skills they need to
develop to increase their chances of being an effective manager.
b. Format
Students should respond individually and privately to the items in this self-assessment.
c. Interpretation
Students’ total numerical score (obtained by finding the sum of the individual scores)
suggests their perceptions of their possession of the skills of effective managers—the lower
the total score, the lower the level of skills. Students should be encouraged to examine their
item scores for lower numbers and then to try to use their educational experiences to develop
more skill in the areas identified.
Experiential Exercise
Johari Window
a. Purpose
This exercise has two purposes: to encourage students to analyze themselves more
accurately and to start them working on small-group cohesiveness. This exercise encourages
students to share data about themselves and then to assimilate and process the feedback.
b. Format
Students individually complete three lists:
Quadrant 1—things that they and others know about themselves
Quadrant 3—things that they know about themselves that others do not know
Quadrant 2—things that they did not know about themselves but that they learned from
others last semester
c. Follow-up
You might want to lead a group discussion on interpersonal perception as a follow-up to this
exercise. Any students who wish to share how they have moved information about
themselves from, say, Quadrant 3 to Quadrant 1 should be encouraged to do so.
If you are doing a major group project throughout the course, you may want to use this
exercise around the middle of the term, having each student focus on Johari Window as it
relates to his or her group.

MANAGEMENT AT WORK
SOME KEYS TO MAKING A STEINWAY
The case details the painstaking way in which Steinway & Sons builds its pianos, world-renowned
instruments that have earned the company plaudits from generations of professional musicians. A
variety of processes—sourcing inputs, employing skilled labor—are used to build the product and
extreme care is taken every step of the way. The vignette illustrates a variety of management principles
at work, such as the systems view and the contingency perspective of management.
1. Explain the process by which a Steinway grand piano is constructed as a subsystem of a larger
system. From what the text tells you, give some examples of how the production subsystem is
affected by the management, financial, and marketing subsystems.
The company Steinway & Sons is a large system that is made up of several interrelated
subsystems such as operations, management, and marketing. The operations subsystem is
responsible for constructing pianos. Here, skilled employees use various inputs (wood, glue, etc.)
to make the product. The operations subsystem at Steinway (and in any organization) is, however,
not independent of the other subsystems in the organization. For example, the employees have to
be recruited, trained, and retained by the organization (the management subsystem), the inputs
have to paid for and the cash flow managed over the long period from when inputs are sourced
until the piano is sold (the finance subsystem), and the operations process must work in tandem
with the marketing subsystem to synchronize the demand and supply of the product.
2. Discuss the Steinway process in terms of the systems perspective of organizations summarized in
Figure 1.4. Explain the role of each of the three elements highlighted by the figure—inputs from
the environment, the transformation process, and outputs into the environment.
Steinway & Sons illustrates all three essential elements of the systems perspective. The company
obtains various kinds of inputs—materials (wood, glue), human inputs (skilled labor, for
example), financial inputs (cash from sales of pianos)—to run the business. In turn, it uses its
labor and technology to transform inputs into finished products, and finally, it sells the product in
the market to complete the cycle.
3. Discuss some of the ways in which the principles of behavioral management and operations
management can shed light on the Steinway process. How about the contingency perspective? In
what ways does the Steinway process reflect the universal perspective and in what ways does it
reflect a contingency perspective?
Behavioral management comes into play at Steinway when it comes to managing its employees. Its
skilled employees—many of them with long tenures—are most likely the company’s most valuable
resource and they have to be managed with care, keeping their motivation, their stake in the
company, and their personal growth in mind. Operations management is important because
Steinway builds its product very carefully and its product is meant to both perform well and be long
lasting. Steinway illustrates both the universal and the contingency perspective at work. Some things
at Steinway are universal, such as building the piano. The case describes how the company “bends”
wood to take the shape of the outer case. This is a practice that has remained unchanged over the
years. The contingency perspective is reflected in the situation involving the loss of a worker due to
an accident. The company had to change its plans, in this case to slow down its production, until a
replacement could be found.

YOU MAKE THE CALL
Reed Hastings Doesn’t Like Standing Still
4. You’re a Netflix employee and Reed Hastings has just stopped by your desk. “I’d like to know,”
he says, “what you like most and least about working here.” How do you think you might
respond?
Student response may vary depending upon how they approach work. Some may like the work
culture at Netflix that fosters innovation and unleashes their creativity. Others may prefer a more
structured workplace.
5. You’re a major Netflix stockholder attending the firm’s annual board meeting. When you bump
into Reed Hastings at a reception, he asks you, “How do you think we’re doing with this
company?” How would you respond?
Netflix’s financial performance is mixed: it has had its ups and downs in recent years. On the one
hand, if you were a stockholder at the very beginning (when the company did its IPO), you would
have been handsomely rewarded, given that the company’s market price (and hence the value of
your shares) peaked in 2014. On the other hand, if you were a stockholder in 2011 when the
company briefly split into two parts and saw an adverse downturn in its stock price, you would
have seen a sharp decline in your investments. Your question to him could be how to compete in
an industry with significant technology shifts.
6. You’re the founder and owner of a small media company and Netflix has indicated an interest in
buying your business. In addition to price, what other factors, if any, are important to you?
Responses may vary depending upon one’s personal values. Relevant questions might include
whether the employees of the acquired company would be retained, and what the role of the new
company would be in Netflix.
7. You’ve been contacted by a marketing research company doing work for Netflix. The researcher
asks if you use Netflix and if not, why not? If you do use Netflix and the researcher asks what you
like and dislike most about it, what would you say?
This question is from the perspective of a user or a potential user of Netflix, so opinions are likely
to vary considerably. Issues such as availability of content and price are relevant here.

Chapter 2: The Environments of Organizations and Managers 1
CHAPTER 2
The Environments of Organizations and
Managers
CHAPTER SUMMARY
Chapter 2 is devoted to the environment and culture of organizations. It begins with a description of the
organization’s external and internal environments. Then the ethical and social environments are
discussed. A discussion of the international environment follows. Finally, organization culture is
described.
LEARNING OUTCOMES
After studying this chapter, students should be able to:
1. Discuss the nature of an organization’s environments and identify the components of its general,
task, and internal environments.
2. Describe the ethical and social environment of management, including individual ethics, the
concept of social responsibility, and how organizations can manage social responsibility.
3. Discuss the international environment of management, including trends in international business,
levels of international business activities, and the context of international business.
4. Describe the importance and determinants of an organization’s culture, as well as how
organizational culture can be managed.
The opening vignette features the nonprofit organization, the Oregon-based Mercy Corps. In the
aftermath of the devastating 2010 earthquake in Haiti, Mercy Corps quickly set up shop in that
country to provide much needed relief services. Since its founding, Mercy Corps has provided
$2.2 billion in humanitarian aid and development assistance to 114 countries (including India,
Japan, and Sudan) and annually reaches almost 19 million people in 36 nations.
Management Update: Mercy Corps’ website www.mercycorps.org provides recent examples
of the organization’s activities such as helping out in the Philippines after typhoon Haiyan. It is
interesting to note that 88% of donations go to relief activities, with very little spent on running the
organization.

LECTURE OUTLINE
I. The Organization’s Environments
Managers must develop and maintain a deep understanding and appreciation of the environments
in which they and their organization function.
The external environment is everything outside an organization that might affect it and contains
the general environment and the task environment. The general environment consists of broad
dimensions and forces in an organization’s context, while the task environment is the specific
organizations or groups that have a direct impact on a firm.
The internal environment consists of conditions and forces within the organization.
Teaching Tip: Stress the fact that an organization’s boundaries are not always clear and
precise. As a result, it may not always be clear whether a particular individual or group is part of an
organization or part of its environment.
Discussion Question: As a follow-up, ask students whether they think alumni, campus
recruiters, and bookstores are part of the organization or part of its environment.
A. The General Environment
The general environment of a business has three dimensions: economic, technological, and
political-legal.
1. The economic dimension includes the overall health of the economic system in which
the organization operates, which is related to inflation, interest rates, unemployment,
demand, and so on.
Extra Example: Note how economic conditions have affected your college or university.
Specific points can be made regarding state revenues, alumni contributions, government grants, and
endowment earnings.
2. The technological dimension refers to the methods available for converting resources
into products or services.
Extra Example: Note that Federal Express has been hurt by new technology such as facsimile
machines and e-mail. For example, companies now find it more cost-efficient to fax shorter documents
than to send them by express delivery. And many managers find e-mail more efficient than distributing
memos and letters through printed “hard copy.”
3. The political-legal dimension refers to government regulation of business and the
relationship between business and government.
Extra Example: The Small Business Administration (SBA) Office of Advocacy reports that
the regulatory costs for small businesses amount to roughly $7,000 per person employed. These costs
have mainly to do with regulations concerning OSHA and compliance with the Sarbanes-Oxley Act.
(www. Bizjournal.com)
Management Update: While Microsoft has resolved most of its legal problems in the United
States, it still faces a number of antitrust lawsuits in Europe.

B. The Task Environment
Group Exercise: Divide your class into small groups and have each group develop a diagram
similar to Figure 2.1 for an organization in a different task environment. Good examples include
Google, IBM, ExxonMobil, and UPS.
1. Competitors consist of other organizations that compete for the same resources.
Discussion Starter: Ask students to identify the primary competitors of your college or
university.
2.
3.
Customers are those who pay money to acquire an organization’s products or services.
Suppliers include organizations that provide resources for other organizations.
Discussion Starter: Ask students to identify the various suppliers that your college or
university might use.
4. Regulators have the potential to control, regulate, or influence an organization’s
policies and practices.
a) Regulatory agencies are created by the government to protect the public from
certain business practices or to protect organizations from one another. Examples
include the Environmental Protection Agency (EPA) and the Food and Drug
Administration (FDA).
Extra Example: Point out to students the various regulatory agencies that most directly affect
your college or university (e.g., state coordinating boards, etc.).
b) Interest groups are groups organized by their members to attempt to influence
organizations. Examples include the National Organization for Women (NOW)
and Mothers Against Drunk Driving (MADD).
Extra Example: The American Association of Retired Persons (AARP) is an interest group for
members 50 and older. It has over 40 million members, making it one of the most powerful interest
groups in the country. It has influenced legislation on many issues, including Social Security reform
and government policy on medical research.
5. Strategic partners (also called strategic allies) occur when two or more companies
work together in joint ventures.
Extra Example: Microsoft Corporation has formed alliances with many other organizations,
including hardware manufacturers, small software development firms, TV and appliance makers,
automakers, cell phone and long distance providers, Internet service providers, and universities. The
firm hopes to gain access to customers, resources, and information through its joint ventures.
C. The Internal Environment
1. Owners are whoever can claim property rights on an organization. In smaller
businesses, the owner is likely to also be the manager. In a larger business, however,
managers are more likely to be professional employees of the firm. Stockholders are
the owners of publicly traded corporations.
Teaching Tip: Point out again the “fuzziness” that may exist regarding boundaries. For
example, while this book treats owners as part of the internal environment, it could also be argued that
owners are part of the external environment as well.
Teaching Tip: Stress to students the significance of institutional owners and investors in
corporations today. Such owners and investors can exert enormous power over a corporation.

2. A board of directors, elected by stockholders, is required of organizations that are
incorporated; however, many other firms also have them. The board of directors is
responsible for corporate governance and charged with overseeing the management of
the firm to ensure that it is being run in a way that best serves the stockholders’
interests.
Group Exercise: Assign groups of students one or more corporations. Have them identify the
members who serve on its board of directors.
3. Employees are another significant element of the internal environment. The
composition of the workforce is changing, employees are asking for increased job
participation and ownership, and organizations are increasingly relying on temporary
workers.
Global Connection: Note that many Japanese firms used to offer guaranteed lifetime
employment to some employees. In recent years, however, this practice has been abandoned by many
firms.
4. A firm’s physical work environment—where facilities are located and how they are
furnished and arranged—is also important. The layout of an office or factory can be a
strong influence on the way in which people interact with equipment and with each
other.
Extra Example: Walmart is known for having a very spartan headquarters office, in keeping
with the cost-cutting philosophy of founder Sam Walton. The building contains plain metal desks and
uncarpeted floors, even in executive office areas. This physical environment serves as a constant
reminder to employees of the firm’s culture and values.
II. The Ethical and Social Environment of Management
Discussion Starter: A debate that has plagued some business programs is the extent to which
colleges can teach ethics. Some experts believe that ethics can indeed be taught, while other experts
believe that ethics are formed much earlier and thus cannot be taught to people as they get older. Ask
students for their opinions.
A. Individual Ethics in Organizations
Ethics are an individual’s personal beliefs regarding right and wrong behavior. Ethical
behavior is behavior that conforms to generally accepted social norms. Unethical behavior is
behavior that does not conform to generally accepted social norms.
Interesting Quote: “Moral character is shaped by family, church, and education long before an
individual joins a company to make a living.” (See Kenneth R. Andrews, Harvard Business Review,
October 1989, p. 99.)
Discussion Starter: Ask students if they can identify personal examples or events that shaped
their ethics or the ethics of someone they know.

1. Managerial ethics are standards for behavior that guide individual managers in their
work. Unethical behavior by management and other employees sometimes occurs
because the firm has an organizational context that is conducive to such behavior.
Employees who work for firms that support and encourage unethical acts, though they
are in the best interests of the firm, may find themselves in a conflict-of-interest
situation.
Discussion Starter: Ask students to provide examples in which an organization they worked
for treated them or others in an ethical or an unethical fashion.
Teaching Tip: Note that as organizations enter a period of cutbacks and downsizing, the
potential for unethical treatment of employees tends to increase.
Extra Example: Many recent ethical concerns focus on financial disclosure and transparency.
Whereas companies that consistently met their profitability targets were considered to be the most
desirable investments, today the business practices and reporting methods used to reach those targets
are under heavy scrutiny. General Electric, which has long-term consistent profitability, is now under
suspicion for that very consistency.
2. Effective management of ethical behavior includes the following:
a) Top managers should set ethical standards for the organization.
b) Committees can investigate possible unethical activities internally.
c) Employees can attend training sessions to learn to act more ethically when faced
with certain situations.
d) A code of ethics is a formal written statement of the values and ethical standards
that guide the firm’s actions.
Teaching Tip: If your school has a code of ethical conduct for students, it might be interesting
to discuss it here. Note, for example, the similarities and differences that might exist between a
university code and a business code.
Extra Example: Other firms that use codes of ethics include Coca-Cola and Texas
Instruments.
Group Exercise: Ask students to identify common themes and ideas that are likely to be
reflected in all corporate codes of ethics.
3. A number of ethical issues are receiving widespread attention today.
a) A challenge for CEOs is to display ethical leadership and to establish an ethical
culture for the entire organization. The Sarbanes-Oxley Act of 2002 requires
CEOs to be held personally responsible for their firm’s financial disclosures.
b) Corporate governance is another area with many ethical concerns. Boards of
directors are under increased pressure to provide effective oversight.
c) Information technology poses new ethical issues in the area of privacy.
B. Social Responsibility in Organizations
Social responsibility is the set of obligations an organization has to protect and enhance the
society in which it functions.

Extra Example: One firm that has an exemplary record of social responsibility is Target. The
firm gives $2 million each week to local community and charitable groups.
Global Connection: Concerns for the environment are given low priority in some parts of the
world. The clearing of the rain forests in the Amazon basin is one significant example. Another is the
continued destruction of animals facing extinction in parts of Africa. The United States is the world’s
largest creator of the pollution that is destroying the Earth’s ozone layer and is unwilling to consider
international limits on the polluting gases.
1. Arguments for social responsibility:
a) Business creates problems and should therefore help solve them.
b) Corporations are citizens in our society too and should not avoid their obligations
as citizens.
c) Businesses often have the resources to help.
d) Business should be a partner in society along with the government and the
general population.
2. Arguments against social responsibility:
a) Businesses have the responsibility to focus on making a profit for their owners.
b) Involvement in social programs gives business too much power.
c) There is a potential for conflict of interest.
d) Organizations lack the expertise to manage social programs.
Discussion Starter: Ask students to help identify other specific examples of how socially
responsible behavior has had a positive impact.
C. Managing Social Responsibility
1. Firms can adopt a number of different formal organizational stances regarding social
responsibility.
a) Legal compliance is the extent to which the organization and its members comply
with local, state, federal, and international laws.
Discussion Starter: Ask students whether they believe tobacco will ever be outlawed. Ask
their thoughts on whether or not it should be banned.
Teaching Tip: Describe how your local community regulates business through its own zoning
procedures. If relevant, describe a recent controversial zoning decision.
Teaching Tip: Emphasize the point that an organization’s approach to social responsibility
may be inconsistent and/or contradictory.
b) Ethical compliance is the extent to which the firm and its members follow ethical
standards of behavior.
Teaching Tip: Point out to students that, with the escalating diversity of viewpoints on ethical
standards, organizations have increased difficulty in demonstrating ethical compliance. Every industry,
from energy to bioengineering to education, is swamped with a complex and thorny set of ethical issues
today.
c) Philanthropic giving occurs through the awarding of funds or gifts to charities
and social programs.

Global Connection: As noted, international businesses have become frequent contributors in
different countries where they do business. For example, UPS supports national Olympic teams in
dozens of different countries.
2. Informal organizational dimensions, including the culture and leadership practices of
an organization, can define the social responsibility stance adopted by the organization
and its members. Whistle-blowing occurs when an employee discloses illegal or
unethical conduct by others within the organization.
Discussion Starter: Solicit student opinions regarding whistle-blowing. In particular, ask how
many of them would, in fact, “blow the whistle” themselves if it meant the possible loss of a job.
Extra Example: Sherron Watkins, an Enron accounting manager, was a whistleblower for
some of the firm’s unethical and illegal practices. Her actions were instrumental in uncovering the
alleged extensive fraud occurring at that firm.
III. The International Environment of Management
A. Trends in International Business
Extra Example: Based on sales revenues, only two of the world’s largest ten businesses are
U.S. firms (Walmart and ExxonMobil). Four are European, three Chinese, and one is Japanese. (For
details, see Fortune.com.)
Teaching Tip: Note the diverse set of countries represented on the list of the world’s largest
firms.
1. After World War II, U.S. firms dominated most industrial and consumer markets.
From the 1950s to 1970s, Europe and Japan rebuilt their factories and gained market
power.
2. Today, U.S. firms dominate in some industries, including auto making and fast food,
but many other industries are dominated by non-U.S. firms, including chemicals, steel,
banking, and electronics.
3. To be competitive, firms must think globally. International business touches every
sector of the economy and every business and every consumer in the world.
Group Exercise: Have students generate a list of the ten products they use most frequently.
Then have them research the national origin of the companies that make them.
B. Levels of International Business Activity
Firms that plan to increase their international business activity must plan their expansion into
foreign markets very carefully. Several alternative approaches are possible.
1. Importing and exporting are the easiest ways to enter a market with a small outlay of
capital. Exporting is making the product in the firm’s domestic marketplace and selling
it in another country. Importing means a good, service, or capital is brought into the
home country from abroad.
Teaching Tip: Most small businesses begin international activity by importing or exporting. A
good source of information about international business opportunities for small business is the Small
Business Administration’s Office of International Trade website. For more information, see the SBA
website at http://www.sba.gov/OIT/.

Teaching Tip: Stress for students that the difference in exporting versus importing is point of
view. When Rolex markets its watches and ships them to U.S. jewelers, Rolex is exporting, but the
stores that buy the watches for sale in the United States are importing them.
2. Licensing is an arrangement whereby one company allows another to use its brand
name, trademark, technology, patent, copyright, or other assets in exchange for a
royalty based on sales. Franchising is a special form of licensing.
Extra Example: Some of the most successful international franchisers include The Athlete’s
Foot, Subway, and Century 21 Real Estate.
3. Strategic alliances occur when two or more firms jointly cooperate for mutual gain. A
joint venture is a special type of strategic alliance in which the partners actually share
ownership of a new enterprise.
Extra Example: One of the most successful strategic alliances is Cereal Partners Worldwide,
between General Mills and Nestlé. The firms entered into the partnership to compete with Kellogg,
which dominated European markets. General Mills contributes its cereal names and technology, while
Nestlé adds its recognized consumer brand name and handles distribution.
4. Direct investment occurs when a firm headquartered in one country builds or purchases
operating facilities or subsidiaries in a foreign country. Maquiladoras are light
assembly plants built by U.S. firms in northern Mexico close to the U.S. border. These
plants receive tax breaks from the Mexican government. and the area is populated with
workers willing to work for low wages.
Global Connection: The passage of the North American Free Trade Agreement has increased
the importance of the maquiladoras to firms doing business in Mexico.
Extra Example: Disneyland Paris represents a combination of direct investment and strategic
alliance. Disney contributed a portion of the park’s construction costs from its own sources and
oversaw construction of the park, while a French firm contributed the remainder of the investment
capital. Disney shares both profits and losses with its European partner.
Teaching Tip: Emphasize the fact that large firms use multiple methods of managing
international business. For example, Ford ships cars made in the United States to Canada (exporting),
contracts with Mazda to manufacture part of the Ford Probe (licensing), jointly developed the Mercury
Villager minivan with Nissan (strategic alliance), and owns several manufacturing plants in other
countries (direct investment).
Teaching Tip: Use Table 2.1 to compare the advantages and disadvantages of the four levels
of international business activity.
C. The Context of International Business
1. The cultural environment can create challenges for managers, when the countries in
which a firm is manufacturing or selling a product or service have different cultures.
Religious beliefs, time and schedules, language, and nonverbal communication can all
pose problems for managers in a foreign country.
Discussion Starter: Ask students to predict which products made in the United States are most
and least likely to be successful abroad.

Discussion Starter: Ask students which countries in Europe and Asia they have visited. Then
ask how similar or different each was from the United States.
Discussion Starter: Ask students to think of common business practices in the United States
that might seem odd or unusual in a foreign country. If you have any international students in class, you
might ask them about business practices in their home countries that would seem odd or unusual in the
United States.
2. A government can impose a variety of controls on international trade to protect its
country.
a) A tariff is a tax collected on goods shipped across national boundaries.
b) Quotas are limits on the number or value of goods that can be traded.
c) Export restraint agreements are agreements that convince other governments to
voluntarily limit the volume or value of goods exported to a particular country.
d) “Buy national” legislation gives preference to domestic producers through
content or price restrictions.
Teaching Tip: The stiff trade barriers employed by the government of Japan continue to be a
point of contention between that country and the United States. U.S. firms, for example, argue that there
are so many trade barriers in place in Japan that it results in unfair competition for them.
Extra Example: In an interesting reversal of normal procedures, the government of China has
played Ford and General Motors against each other. Rather than offer inducements to get the
automakers to set up shop in its borders, China is getting the companies to make offers on what they
will give in return for the right to be the only U.S. auto company to be allowed to build cars in one of
the world’s largest untapped markets.
3. Economic communities are sets of countries that have agreed to significantly reduce or
eliminate trade barriers among its member nations.
a) The European Union, the Latin American Integration Association (Bolivia,
Brazil, Colombia, Chile, Argentina, and other South American countries), and the
Caribbean Common Market (the Bahamas, Belize, Jamaica, Antigua, Barbados,
and twelve other countries) are examples.
b) The North American Free Trade Agreement (NAFTA) created an economic
system between Canada, Mexico, and the United States.
Discussion Starter: Ask students why they think Asian nations have not formed an economic
community with the strength and identity of the EU or NAFTA.
4. GATT, the General Agreement on Trade and Tariffs, and the WTO, the World Trade
Organization, both play significant roles in regulating international trade.
a) GATT, first ratified in 1948, is an attempt to reduce trade barriers. One of its
provisions, the granting of most favored nation status, specifies that a member
country must extend equal treatment to all nations that sign the agreement.
b) The World Trade Organization was begun in 1995 as a replacement for GATT.
The WTO works to promote trade, reduce trade barriers, and resolve international
trade disputes.
IV. The Organization’s Culture

Organization culture is the set of values, beliefs, behaviors, customs, and attitudes that helps the
members of the organization understand what it stands for, how it does things, and what it
considers important.
Extra Example: Some experts would use the extent to which investors and other experts
admire a company as an indication of its effectiveness. Each year Fortune conducts a survey of the
most admired corporations in the world. Apple, Amazon, Google, and Starbucks were at the top of the
list in 2014.
Extra Example: Other firms with strong cultures include Disney, 3M, Coca-Cola, UPS, and
IBM.
Discussion Starter: Ask students to discuss the culture that exists in your college or university.
A. The Importance of Organization Culture
A strong organization culture can shape the firm’s overall effectiveness and long-term
success and help employees to be more productive.
B. Determinants of Organization Culture
Culture develops over a long period of time. It often starts with the organization’s founder;
however, corporate success and shared experiences also shape culture. Stories, heroes, and
symbols have a powerful effect.
C. Managing Organization Culture
In order to manage corporate culture, managers must first understand the current culture.
1. If the culture is one that is in the best interest of the firm, managers can reward
behavior that is consistent with the existing culture in order to enforce it.
2. If the culture needs to be changed, managers must know what it is they want the
culture to be and then take actions that will help to change the culture into the type
management wants. One effective action is to hire outsiders, who will change the
existing culture.
END-OF-CHAPTER
Questions for Review
1. Identify and discuss each major dimension of the general environment and the task environment.
Because the environment provides the context in which a business operates, it determines the
firm’s eventual success or failure. The general environment consists of three dimensions:
economic, technological, and political-legal. The economic dimension includes macroeconomic
trends that impact all businesses, such as inflation and unemployment. The technological
dimension includes advances in computing and communications. The political-legal dimension
consists of legislation, legal proceedings, and the political climate.
The task environment of an organization consists of specific dimensions of the organization’s
surroundings that are very likely to influence the organization. Competitors, customers, suppliers,
regulators, and strategic allies comprise the task environment. Competitors are firms that are
competing for resources, and customers are those that purchase the firm’s products. Suppliers
include any organizations or individuals that supply resources to the firm. Regulators provide

oversight to the firm and include regulatory agencies and interest groups. Strategic allies are
partners with the firm in joint ventures.
2. Do organizations have ethics? Why or why not?
As defined here, organizations do not have ethics—only individuals have ethics. However, the
ethical norms and climate that exist within an organization can significantly affect the
organization.
3. What are the arguments for and against social responsibility on the part of businesses? In your
opinion, which set of arguments is more compelling?
Arguments for social responsibility include: (a) organizations create problems and should be
responsible for solving them; and (b) corporations are citizens in our society, too, and should not
avoid their obligations as citizens. Arguments against include: (a) businesses should simply focus
on making a profit, (b) there is the potential for a conflict of interest, and (c) businesses lack the
expertise to understand how to assess and make decisions about worthy social programs.
4. Describe the basic levels of international business involvement. Why might a firm use more than
one level at the same time?
There are four levels of international business activity: (1) A domestic business has no
international ties and buys and sells goods only in its own country. (2) An international business
primarily resides in one country but purchases components from abroad or sells a substantial
amount of finished products to other countries. (3) A multinational business has a worldwide
marketplace from which it buys raw materials, borrows money, manufactures its products, and to
which it sells its products. (4) A global business transcends national boundaries and is not
committed to a single home country.
Many organizations use more than one level at the same time. This is done in order to adapt to the
needs of different countries or regions, or to implement different strategies for different countries.
5. Describe various barriers to international trade. Why do such barriers exist?
The economic environment, the political-legal environment, and the cultural environment are
three areas of challenge to international managers. Numerous specific instances of each can be
identified. They exist for a variety of reasons including the interests of the host government in
protecting home businesses and simply the differences across countries.
Questions for Analysis
1. Can you think of dimensions of the task environment that are not discussed in the text? Indicate
their linkages to those that are discussed.
Student responses will vary, but one environmental dimension that was not discussed in the text
was climate and weather. The climate and weather may have a great impact on the farming
industry. A late frost in Florida may hurt the orange crop, or a drought in the Midwest may be
responsible for poor grain yields. For the downhill skiing industry, sustained low temperatures and
snow are prerequisites, so climate in this instance may dictate the location of the industry. Climate
and weather are also important to surgeons specializing in skin cancer and orthopedic surgeons
who specialize in broken limbs.

2. What is the relationship between the law and ethical behavior? Can a behavior be ethical but
illegal at the same time?
The law mandates or prohibits certain behaviors, with relatively little flexibility or subjectivity.
Ethics suggests desired behaviors, but is equally concerned with the intention and reasons behind
a behavior as with the behavior itself. Ethics is based on standards that are flexible and subjective.
Individuals or organizations can act in what they feel is an ethical manner while also breaking the
law. For example, some individuals try to block abortion clinics in an effort to stop actions that
they believe are harmful. In their eyes, these actions are ethical, but to the police, who may arrest
them for trespassing, the actions are illegal. In the news today are stories about pharmaceutical
companies in China, Africa, and India that illegally produce patented drugs, which they feel is an
ethical necessity to stop the spread of contagious diseases in countries where drugs produced in
the United States are prohibitively expensive.
3. What is your opinion of whistle-blowing? If you were aware of a criminal activity in your
organization but knew that reporting it would likely cost you your job, what would you do?
Answers will vary. Some will say that it is their duty to society to report criminal activities,
whereas others may feel it is their duty to protect the organization and not report criminal activity.
Still others will feel that their primary responsibility is to themselves or their families, which
would require them to protect their jobs.
4. What industries do you think will feel the greatest impact of international business in the future?
Will some industries remain relatively unaffected by globalization? If so, which ones? If not,
explain why not.
International industries generally involve mass-produced consumer or industrial products such as
automobiles, electronics, steel, chemicals, and so forth. In contrast, industries that would
experience high costs for shipping or manufacturing goods in distant locations are somewhat
sheltered from the effects of globalization, as are industries where local tastes and needs are very
different from global tastes. Examples would include restaurants, home builders, and plant
nurseries. However, you can point out to students that consumer preferences are becoming more
global, with more Americans buying imported chocolates and more Latin Americans buying
Nikes, for example.
5. What is the culture of your college, university, or place of employment? How clear is it? What are
its most positive and its most negative characteristics?
Students should recognize that all organizations have a culture, but they may differ in their
perceptions of the existence of a culture and what that culture is. Generally, a majority will agree
on a “party,” “athletics,” “research,” or “scholarly” culture. Words such as these will be used to
describe the culture to outsiders. You can remind students that every culture has its positive and
negative characteristics, encouraging them to think more deeply about culture’s effects.
Building Effective Interpersonal Skills Exercise
a. Purpose
This exercise uses a fun, easy scenario-based exercise to help students understand the
complexities of culture in various countries when it comes to communication.
b. Format
This exercise is most effective if administered in class. That way, students can work
individually and then share their responses with the class. This exercise takes about 15–20
minutes to administer, but the discussion could take much longer.

c. Follow-up
In terms of difficulty (easiest first), the following is the likely rank order.
German and French colleagues exchanging emails about a new project
Young U.S. female manager meeting with older female manager from Mexico
Telephone conference call between a young Indian male manager and an older Chinese male
manager
A face-to-face committee meeting with five people of the same gender from Indonesia,
Russia, Canada, Pakistan, and Israel
Skype call involving a male Jordanian manager, a female Australian manager, and a male
Israeli manager
This can then set up a class discussion to examine and assess the rankings.
Building Effective Communication Skills Exercise
a. Purpose
This exercise assigns students the difficult—but realistic—task of persuading a superior that
his or her ideas may be inadequate. The task requires students to justify the need to gather
more information about the customer segment of the environment.
b. Format
This exercise is best done outside of class by individual students, and it requires about 20–30
minutes.
c. Follow-up
(1) With this background in mind, compose a written proposal for your boss, outlining
your position. Be sure to emphasize your fundamental concern—that the marketing
department needs to better understand the needs of each customer segment in order to
provide products that meet those needs. Consider ways to persuade your boss to
change his or her mind. (Hint: Telling him or her bluntly that he or she is wrong is
unlikely to be effective.)
Students’ answers will focus on the importance of understanding the specific needs of
various groups of consumers. Students are likely to describe the importance of
consumers to the firm, the necessity of obtaining accurate and specific feedback, and
the likely negative consequences if consumer feedback is not obtained. The challenge
for students will be to present their position in a forceful yet tactful way.
(2) On the basis of what you wrote in response to Exercise Task 1 above, do you think
your boss will change his or her mind? If yes, what persuaded him or her to change his
or her mind? If no, what other actions could you take to attempt to have your ideas
adopted by the firm?
Students’ answers will vary. They will see that persuasion requires tact as well as
strong logical arguments. For additional actions, students might suggest an appeal to a
superior, gathering the feedback anyway without informing the boss, or simply
dropping the idea. For each of these actions, ask students to consider what would
happen then. For example, how would their boss respond to finding out that he had
been deceived?

Skills Self-Assessment Instrument
Global Awareness
a. Purpose
This self-assessment is designed to help students understand their readiness to respond to
managing in a global context through assessing their knowledge of cultural differences
among countries.
b. Format
Students should respond individually to the items in this self-assessment using the scale
provided.
c. Interpretation
All of the statements are true, so a perfect score would be 40. The closer a student’s score is
to that, the more knowledge he or she has of cultural differences among countries and the
more he or she understands the global context of organizational environments. The closer
the score is to 10 (the minimum possible score), the less the student knows and the less
prepared the student is for managing in a global context. Students should be encouraged to
improve their knowledge for any area in which they had a low score. They should be
encouraged to read Nancy Adler’s International Dimensions of Organizational Behavior,
2nd ed. (Boston: PWS-Kent, 1991).
Experiential Exercise
Assessing Organizational Culture
Purpose: While organization culture is intangible, it is not difficult to observe. This activity will help
to improve your skills in observing and interpreting organization culture, which can help to make you a
more effective participant and leader in organizations.
Introduction: Clues to organization culture may be found by observing details that relate to member
behavior, traditions or customs, stories, attitudes, values, communication patterns, organization
structure, employee dress and appearance, and even office space arrangements. Do members address
each other by first names? Are office doors left open or closed? What do members wear? How are
achievements recognized? Does the workplace feel energized or laid-back? Do members smile and
laugh often? Does seniority or expertise earn more respect?
Instructions: First, observe clues to organization behavior at your school, college, or university. To
the extent possible, observe a diversity of members including students, teaching faculty, and non-
teaching staff. Write down specific examples. For example, students typically wear blue jeans, while
instructors usually wear suits. In the cafeteria, freshmen sit mainly with other freshmen. A professor
may be referred to as “Doctor” by staff, while she may refer to staff by their first name.
It is possible that variations exist across schools within the same university. Students are likely to see a
different set of norms in nonprofessional schools (where they are likely to have had classes) in
comparison to those at professional schools.
Second, interpret the facts. Use your observations to describe the organization’s core values. What does
it value most? How did you come to that conclusion?
Do some schools value the end results and downplay the means leading to those results? Again, it is
possible to see variations across programs.

Third, with the class or in small groups, discuss your facts and interpretations. Focus especially on areas
of disagreement. Where individuals disagree about the culture, try to understand why the disagreement
occurs. If the facts differ, perhaps the individuals observed two different groups. For example, students
majoring in business may be different than students in engineering or education. Or perhaps the
organization culture tolerates or encourages lots of differences. If there is agreement on facts but
interpretations differ, then perhaps the individuals making the interpretations can explore their differing
perceptions.
It is also possible that traditional students in the class may have a different viewpoint as compared to
nontraditional students. Older students returning to the classroom after years of work in the “real”
world may have opinions about organization culture different from those of younger students.
MANAGEMENT AT WORK
IS FAIR TRADE A FAIR TRADE-OFF?
The case features the world market for cocoa. The world market for cocoa beans is highly volatile.
Consequently, farmers in cocoa export-dependent nations such as Ivory Coast strive for any
means to cut costs. One such measure is to employ child labor, who work long hours in poor
conditions. The Fairtrade Labeling Organization (FLO) addresses this concern by promoting
programs designed to ensure that export-dependent farmers in developing countries receive fair
prices for their crops. The organization has its critics, though, who contend that the program
enriches the middlemen and do not really benefit the farmers.
1. How does the environment affect fair trade?
To help students with this answer, it may be a good idea to get students to think of the entire
cocoa supply chain, from farmers in Africa to retailers of chocolates worldwide. Each is affected
by various types of environmental changes. For example, everyone in the chain is affected by the
global economic environment. In addition, farmers in Africa are affected by a changing social
environment where views on child labor are changing.
2. What are the trade-offs in the fair-trade process? Do you think that fair trade promotes fair trade-
offs? Why or why not?
Fair trade protects suppliers. The trade-off, though, is that fair trade products cost more. This is a
question that is likely to provide contrasting viewpoints among students as they look at the cost
versus benefits of fair trade.
3. Do you pay attention to fair-trade products in your own purchasing behavior? For what kind of
products might you be willing to pay premium prices?
Responses will vary depending on how the student views fair trade.
4. Under what circumstances might fair trade actually cause harm? To whom? At what point would
fair-trade trade-offs no longer be acceptable?
If the price of fair trade products to consumer become so high that they are uncompetitive it may
have an adverse effect on demand, which may, in turn, affect suppliers. Fair trade would be
acceptable till such a point is reached.

YOU MAKE THE CALL
Social Entrepreneurship at its Finest
1. What environmental events and forces have led to the existence of organizations such as Mercy
Corps?
A variety of environmental threats – economic, social, natural disasters – have led to the existence
of an organization like Mercy Corps. When a disaster hits an area – such as the earthquake in
Haiti – everything is in disarray and an organization like Mercy Corps. provides the infrastructure
and support for regular life to go on.
2. In what ways does Mercy Corps interact with its environment in order to fulfill its mission?
It is important to note that Mercy Corps believes communities that are affected must be the agents
of their own change. This means that Mercy Corps interacts with the social, cultural, economic,
and political environments of the place that it is providing relief in.
2. Discuss how economic, global, and ethical environments interact with respect to an organization
like Mercy Corps.
Take the Haiti earthquake as an example. When Mercy Corps landed in Haiti to address the
effects of the disaster, it had to deal with the economic environment (providing a means of income
to people by getting them to clear the debris, for example), the global environment (coordinating
the worldwide response to the disaster) and the ethical aspects of its work.
3. If you were asked to critique Mercy Corps in terms of effectiveness, what factors would you focus
on?
While student responses will vary, they have to keep in mind that in measuring how well an
organization like Mercy Corps function, one has to see what its mission is and judge it based on
that. For example, Mercy Corps’ mission says that the affected community must take ownership
of the change. A Mercy Corps mission is effective if this actually happens.

17
Chapter 2: The Environments of Organizations and Managers

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showed he was in full scent again. On, then, by the side of
the now roaring beck, for the snows were melting and the
stream was becoming strong and loud.
Suddenly Laddie stops—ears pricked—head in the air. What
can he hear beside the brawling of the stream? He breaks
out into an almost human cry, and rushes on in spite of
Alice's distressed calls and commands that he should not
leave her. She certainly hears another voice besides his, no
—yes, the joyful barking of two dogs—old Chance's full deep
voice and Laddie's sharp treble. Look, Laddie is coming back
to meet her, trembling all over with intense excitement.
A few more painful efforts, and the young girl sinks
perfectly exhausted beside her senseless brother. But she
has no leisure for fainting, no time for feeling: she has stern
work in hand. Is he dead or alive? That is the only thought.
Chance is still laboriously licking the face and the hands of
his master. Alice lays her hand on his heart, and still—yes,
still—she thinks there is a feeble beating and a little sense
of vital warmth. That is enough for her.
"Off, Laddie," said she earnestly to the dog, waving her
hand in the direction of Scarf Beck Farm; "off, and bring
them here;" pointing to his master.
The dog understood and was off. What cannot a shepherd's
dog understand, when, at his master's bidding, he will hunt
up, collect and bring home, a whole flock of lost and
scattered sheep, without missing a single one?
The party returning from the old Man were coming along
the pathway which led to Scarf Beck Farm, when Laddie saw
them at a distance—dark figures on the white snow—and
rushed wildly up to them, entreating them by every
argument, short of speech to follow him.

"What's to do with the young dog?" said old Geordie in an
excited voice. "He has found out something for sure. Look
at his ways."
They hurried along after him as though he were a human
guide, and before long they came, sure enough, upon that
sad group in the cave-like hollow which was scooped out of
the side of the great snow-drift.
"She has found him," exclaimed Mark; "thank God for that."
Alice was sitting on the snow holding her brother in her
arms and clasping him tight to her warm heart. She had
wound her plaid around him besides; and the old dog was
still leaning against him, licking his blue hands and wrists.
Alice's face was buried in her brother's hair; but at the
sound of Mark's exclamation, she looked up hastily, and
saying:
"Oh, Mark," burst into an agony of tears, the first she had
shed. "Oh, do something to save him. I know he is not
dead. I am sure I can feel his breath."
They knelt around the seemingly lifeless figure, and Old
Geordie took out a little flask of brandy, which he had put
into his pocket on starting from home, saying to Old Ann,
"I'll take this, however; no one knows but there may be
sore need of it."
He now managed to get a little of the restorative within the
livid lips; and after what seemed a long, long time, there
was an evident attempt to swallow. It was more like a
spasm of pain than a natural effort; but it showed that the
living spark had not quite gone out. They all now set to
work, rubbing the hands, chafing the feet, bathing the
temples with brandy, and again contriving to get a little of
the liquid swallowed.

"We must carry him home," said Geordie; "we shall never
get him round here, in the cold wind. Sister will wrap him
up right well, and we men will carry him."
And so the melancholy-looking procession moved away
from the shining snow-cavern, the dogs trailing along
behind in a state of deep depression, because they did not
like the look of the long muffled figure helplessly borne
along by the four silent men. Alice tried to get on in
advance, to give warning to her mother, and to prepare the
hot bed, hot blankets, and hot drinks, on which she rested
her hopes. But with all her efforts, her spent strength could
make small progress.
"Don't distress yourself so, Alice," said Mark Wilson, who
was anxiously watching her spasmodic efforts; "we shall be
there as soon as you."
"I must do something to help," she replied, with quivering
lip.
"Thou go and help the lile maiden," said Geordie
compassionately; "she'll drop soon, and we shall e'en have
them both to carry home to mother. One is bad enough."
But for this encouragement from the old servant, Mark's shy
reserve would have withheld him from aiding the poor girl.
She had dropped behind by this time, in utter prostration of
her over-strained powers. It was well that this strong and
willing arm came to the rescue. How confidingly she leaned
on him! How she trusted her weakness to his strength! She
felt as if she could have done anything with that arm to aid,
that voice to encourage, that look of understanding
sympathy, tender and true, to comfort her. Will they ever
forget that mournful walk? Never—as long as they live.

Young Mat had by this time returned from his bold but
fruitless expedition to the distant hamlet, and had caught
sight of the dark group of figures winding along over the
white fields. He thought that all was indeed over. It looked
like nothing but one of those mournful processions which he
was accustomed to see creeping along the side of the hills,
up out of one valley, and down into another, on the old
paved pathways leading to the common centre in the
church-yard which are expressively called in the language of
the country, "corpse-roads."
"They are coming along, mother," said he, entering the
kitchen, and gently going up to his mother's chair; "they
have found Miles, I think, but I don't rightly know how."
The widow looked searchingly in the boy's face, and
trembled all over. "Nevertheless," said she, "I'll have
everything ready for life. In His hands are the issues. Warm
the lad's bed, Ann, and heat the blankets—ay, roast them
brown, if thou likest. Put the peppermint tea on the hob. Do
thou try warmth, and I'll try prayer;" and the aged women
betook themselves to their several offices.
The party soon entered in silence; for they dared not raise
the mother's hopes over so very doubtful a case of revival.
"Take him straight to his own warm bed," she said, "and
place me and my chair beside him. Who knows but the Lord
may hear the cry of the destitute and not despise their
prayer? It seems borne in upon my mind that it shall be
well with the lad, and that his spirit shall come to him
again."
Two long hours afterwards, Alice glided downstairs, and
going to Mark, who was leaning his head on both his hands,
with his elbows on the kitchen table, said with beaming

eyes and glowing face, "Oh, Master Wilson, the color is
come again into Miles' face, and he is quite warm, and
sleeping like a child."
He started up, took both her hands in his, and pronounced
a solemn thanksgiving.
"Alice," he added, "let us pray that our brother may in very
truth be alive from the dead. Surely that was repentance
last night. I thought I heard the sob of a broken and a
contrite spirit. But his going out in that strange way is what
puzzles me."
"Wait—wait, and see," said the loving sister; "I think it will
all be made clear. He was so tender to mother last night; so
very gentle and kind to me."
"That is no particular sign of good that I know of," said
Mark, smiling at her flushed and eager defence of her
brother; "how could he be anything else than kind, and
loving to thee?"
"Oh, Master Wilson, you don't understand me at all."
"Master? We can never be master and pupil in that old
distant way after having shared so much together yesterday
and to-day. I shall never be able to separate the thought of
thee from anything now, Alice."
But she was gone, fluttering away like a startled bird,
before he had finished the sentence which it had cost him
so much emotion to pronounce.
"She is gone," said he, despairingly. "I believe I don't
understand women's minds as well as school-boys. Now,
one would have thought that she would at least have waited
to hear what I should say next."

CHAPTER VI.
THE MOUNTAIN ECHOES.
"An idle word—a lowly prayer—
A gentle 'Bless thee!' fitly
spoken,
May live, and echo through the
air,
As if its life could ne'er be
broken."
It was days before Miles Lawson rallied. His powers were so
utterly prostrated, that dull heavy sleep seemed to be the
only resource of nature. They could scarcely rouse him,
even to take the needful nourishment; and at such times he
took no notice of any one, but drank his mother's
concoctions, or Alice's less distasteful preparations, in a
mere mechanical manner, without raising his dim eyes to
see what hand was ministering to him. All this while he
never spoke, or showed the least consciousness of what had
passed; and his watchful attendants wisely refrained from
forcing any exciting subject upon his over-strained nerves.
"He will mind all about it as soon as he has got strength to
look back over his shoulder," said the old lady; and so she
folded her hands patiently, and waited another day, and yet
another, for the signs of reviving consciousness.

In the meantime, all were not idle at The Yews. Mr. Knibb
had been extremely excited by the news of the discovery of
the secret still on the mountainside, and had made more
than one effort to set off for the lofty spot on the same
evening. But Madam was wholly of another mind, and
showed so much partiality for the warm stable, and such an
objection to be mounted on four hard and slippery balls of
snow, that the impatient old gentleman had to yield the
point. Madam was quite in the right; nothing could then
have been attempted with success, or even with safety.
Early on the following morning a strong party was
mustered, headed by Mr. Knibb and the schoolmaster, and
composed of Geordie Garthwaite, young Mat Lawson, the
farm lads, and Bella Hartley's brothers. There were two
carts in attendance, and these were picketed at a chosen
spot, as far up the mountainside as wheels could reach. The
old exciseman, leaving Madam with the rear guard, carefully
covered with his own drab top-coat, labored up the steep
path with marvellous spirit and speed.
Once or twice they caught sight of a small figure,
apparently that of a young boy, which was hovering about
at a considerable distance from them, and hiding in nooks
and crevices, as if stealthily watching their proceedings.
"What is that? A lad or a dog?" asked Mr. Knibb, too much
excited to observe narrowly. "Catch it, my lads, whatever it
is. Depend upon it, it is contraband."
They gave chase for a few minutes; but the little object
darted away like a mountain sheep, and disappeared.
"Never heed," said the schoolmaster; "I don't much like
catching a poor child; even if we could, and torturing him

with fright into telling all he knows, and perhaps more than
he knows."
Besides his compassionate feeling, Mark was very anxious,
for his friend's sake, to get through the affair as quickly and
easily as possible, consistently with his strong sense of the
just and the right. And although he would have done
everything which he believed to be required of him as a
good subject, yet he was not sorry to see the little scout re-
appear at an amazing distance down the steep, and joining
a larger group of moving objects, wholly vanish together
with them behind a broad spur of the mountain. Pursuit was
hopeless, as the unknown figures had the advantage of
ground and of great distance.
"There go your potters, I should say, Mr. Knibb," said Mark.
"Likely enough," was the reply, in a tone of mortification.
"Much if they have not been at the still in the night and
carried off all the stock."
"We had best hurry on, and see about it," said Old Geordie
eagerly.
They did hasten on, gained the mouth of the adit, and
looked anxiously round to see if anything had been
disturbed. No; everything wore the same look as on the
previous day.
"Here we are, just in time," remarked Mr. Knibb, rubbing his
hands; "my potter friends were just then coming to strip
the place, and old George Knibb has for once got the start."
He was perfectly charmed with the completeness of the
little establishment, and went about sniffing and tasting
with marvellous zest, making entries in his note-book of
everything which the cave contained.

Whilst this regular inspection was going on, and whilst Mr.
Knibb was making his official inventory, Mark looked
anxiously round to see if he could discover any traces of his
friend's complicity in the lawless affair. Suddenly, he espied
a sheet of writing paper, which was stuffed into a corner,
and which looked as if it had been used to wrap up some
little refreshment, such as bread and cheese, or the like. A
thought struck him; that scrap of paper may afford
evidence of guilt.
He stepped across to the side where it lay, and, on looking
at it more closely, thought he recognized his own hand-
writing upon it. His own writing? How could this possibly
be? He looked at it again: "My dear Miles." Here, then, was
proof fearfully clear. This must be a letter which he had
written to Miles Lawson a week or two before, in reference
to the period of his regularly revolving visit to The Yews,
and which he had sent by a careful hand, not likely to have
failed in its due delivery.
He hastily seized the paper, and, crumpling it up, thrust it
into his breast; but this was done with such an undisguised
look of pale terror, that Old Geordie, who, like himself, was
on the look-out for traces of his young master's former
presence in this unlawful spot, saw at a glance that
something was wrong.
With his wonted almost feudal attachment to his house, he
hurried to the schoolmaster's help by calling out in a loud
voice, in order to divert attention. "To think that we should
be such a bad disloyal lot, as never to have minded that 'tis
our first duty to drink the king's health in his own 'mountain
dew,' with 'three times three,' my lads!"
"Ay, to be sure, so we ought," exclaimed the farm servants.

"Come, then, all of you, out to the mouth of the hole," said
the old shepherd leading the way—an invitation which was
but too willingly followed by the whole party, with the single
exception of Mark Wilson.
"Come, schoolmaster," said Mr. Knibb, "I hope you teach
loyalty to all your lads."
"Yes; but not by making them worthless subjects," replied
Mark, recovering from his ill-concealed consternation.
"You don't mean to say you are not going to drink his
majesty's health and long reign on this extraordinary
occasion?" expostulated the excited old exciseman.
"My voice shall swell the cheer," said Mark, smiling; "but my
lips shall never touch the white-fire, which might turn me
into a fool or a madman."
"The master is right, as he is a'most times," said Geordie;
"an old man had so well keep a clear head upon his
shoulders, when he has such a scramble before him a'down
over t' crags, with a heavy jar or two upon his back. I'll join
Master Wilson in a dry toast."
"But, Mr. Knibb," said Mark, "the spirits are not ours."
"Suppose then we honor the king, and give the cheer
without the whiskey. It will be a new sort of toast, but not
the worse for that." The exciseman agreed to the proposal
and gave the words, "Long live the king;" whereupon arose
a cheer from the mouth of that strange hollow, which the
mountain echoes took up and repeated, one crag tossing it
on: like a bounding ball to the next crag, the ledge taking it
up and flinging it on into the hollow, the ridge sharpening it
afresh before it could die away in the depths of the gorge,
and the ravine sending it softly down in a silvery whisper to

the sleepy lake below. The group of mountaineers was
almost startled by the marvellous effects of this ebullition of
their loyalty; for the excited echoes seemed to go on
repeating that hearty cheer as if they would never let it die
out—as if determined that it should become a living, abiding
voice of the hills.
However, time pressed, and they returned to business. It
was no trifling undertaking to remove such cumbrous goods
and chattels down the steep sides of a craggy mountain;
and more than once a disastrous slip occurred in the
experience of the heavy-footed farm servants, which sent a
jar bounding, leaping, curveting down the face of the rocks,
the liquid contents flying off in sparkling jots as it went,
insulting the innocent little juniper bushes which were
taking their long winter sleep beneath the snow, and
demoralizing the pure and spotless snows themselves.
Mr. Knibb was uncommonly exasperated by these accidents,
and was led to waste large stores of the "King's English" on
the occasion. "Why, it is direct treason. It is his majesty's
property that the fellow is destroying in that reckless way. I
declare I will report him—I'll prosecute him. There it goes
again. Next time I'll send you after it, and we shall see how
you will relish trundling in that fashion from rock to rock, all
down the precipice."
At length, the bivouac was reached, the carts were loaded
and despatched; and the weary procession again ascended
the mountain, to return heavily laden as before. The cavern
was at last completely dismantled; and the schoolmaster's
pen was speedily employed by Mr. Knibb in drawing up a
brilliant narrative of "The remarkable discovery of an illicit
still on Coniston Old Man."

A reward was afterwards offered for the apprehension of all
the offenders; but Miner Jack and Broom Tim had
succeeded in effecting their escape "over sands," though
chased by a far more relentless foe than the old exciseman,
even by that treacherous tide which walks up so calmly and
yet with such rapid steps, taking noiseless possession of the
sandy plain.
But to return to The Yews: Miles' lethargy lay so long and so
heavily upon him, that his patient mother at last thought it
would be desirable to rouse him. One evening, when she
had been administering her last resource (a burning hot tea
made of Cayenne pepper), which had appeared to
stimulate, not to say excite him, more than any previous
means that had been tried, she thought she would venture
to mention the name of Bella Hartley. But she was not
prepared for the suddenness of the effect produced.
Miles started up in bed, exclaiming, "I must go—I must go
and save her; no wrong shall ever come to her door
through me. The snow is deep, very deep; but nevertheless,
I must go, traitor or no traitor, informer or not."
With this he made a feeble effort to spring out of bed; but
the widow laid her hand upon his arm, settled his head
again on his pillow, and said, "Bella is safe; no harm has
come to her; the snow is all gone, and thou art lying quietly
in thy own bed with thy old mother sitting beside thee,
Miles, my son."
He looked first puzzled, then troubled; but the dull light in
his eyes was clearing, and gleam after gleam of intelligence
was passing slowly over his face. It was evident that the
heavy clouds were gathering up and rolling away, and that
the distempered mists and unhealthy fogs which lay over
the past were being dispelled by the reviving rays of

memory. But it was manifest to Mark's eye (for Mark, too,
was sitting beside his friend) that the backward views which
Miles was obtaining through these rents in the clouds were
often very painful ones. He changed color again and again,
and passed his hand across his forehead, as if to wipe out
their remembrance.
At last he took his mother's hand, and smiled such a smile
as she had not seen on her son's face for many a long day—
a smile of confiding love and of almost child-like simplicity.
"I shall have to tell thee all things that ever I did, I think,
mother; and thou must make thy heart ready to listen to a
sad story."
"If we confess our sins, God is faithful and just to forgive us
our sins, and to cleanse us from all unrighteousness," was
his mother's reply; "confess thy sins to God, and ask Jesus
to reconcile thee to thy Father and his Father, to thy God
and his God. Never mind the telling me all about them."
"I have confessed them to him, mother, and I do believe he
has put away their iniquity. But it will be right for me to
humble myself to the dust, after sinning with such a high
hand: and I wish, I really do wish that someone else, you
know who, was here to know all about it, too."
"No," said Mark, hastily, "if you mean the young woman,
she never need know all the sad particulars about the past,
now. Miles will lead a new life; he will uphold the good old
family motto; he will 'Feare God, and worke ryteousnesse,'
and the young woman's respect and love never need be
shaken, I should think."
"She will only love him the more for all he has suffered,"
said a gentle voice; but when they looked round, Alice
flushed and went to the window.

"Alice is right," said Mark Wilson, looking at her with fond
pride; "there is nothing like honesty, and openness and
truth. It was only to spare her and to spare him that I took
the weaker part. We always walk safest and surest in broad
daylight."
Miles held out his hand to his old friend and said, "That was
the doctrine you always taught me; but I have been a bad
scholar indeed. However, I shall tell Bella everything when I
am strong enough; and then we shall see whether she will
ever trust me again."
CHAPTER VII.
CHANGING SEASONS.
"Life is astir beneath dead Nature's snows
Spring's quickened pulse is bounding
through the earth.
Lo, in the wakened heart a life-stream
flows:
Old things are dead; behold a second
birth."
TIME passed on. Months had slipped away since the mind of
Miles Lawson had awakened to the consciousness of the
past. But the recovery of his bodily powers had not kept
pace with the renewal of the mental. A low fever, the
natural rebound of the death-like chill, had been lying

heavily upon him, completely prostrating his strength, and
refining his rude manly frame into something too ethereal
and shadow-like for a young mountaineer.
His brown and sinewy hands had become white and almost
transparent; his cheek hollow and pale, save for the small
bright spot which lighted it up, while his eyes looked
prominent and lustrous as lamps. But the expression of his
whole countenance and manner had as decidedly changed
for the better as his health had altered for the worse: the
countenance was now open, winning, and thoughtfully
intelligent, instead of sullen and unhappy: the manner was
gentle and deferential, instead of capricious and intolerant.
No one who knew anything of the changing signs of the
moral seasons—seed-time and harvest, winter and spring—
could doubt these outward evidences of the inward work of
grace. That change had been going on which is described in
Scripture language as the turning from darkness to light,
from the power of Satan unto God. The depths of
repentance had been passed through, not once only, but
again and again; the sweetness of reconciliation had been
known with a justly offended God through the free and full
atonement offered for sinners by the Son sent by the
Father: and thus delivered from the bondage of sin and
Satan, the new creature in Christ Jesus was seeking to live
a new life through the power of the sanctifying Spirit.
But Miles Lawson, after his many slips and wanderings, had
found it good for his soul's health to linger long in the
"valley of humiliation," and he found it to be such as John
Bunyan describes it, "as fruitful a place as any the crows fly
over."
"I have known many laboring men," says Bunyan, "that
have got good estates in the valley; for indeed, it is very

fruitful soil, and doth bring forth by handfuls."
A beautiful change in the outward aspect of the dale, and in
the habits of dale life, had been going on during the same
period. It is scarcely like the same region. True, the noble
outlines remain immovable—the mountains drawing their
fine forms against the sky; the lower fells crossing each
other in those graceful intersecting lines which the eye so
loves to follow; the valley biding with such shy and shady
reserve under the glooms of the projecting crags; and the
stream finding its way with its lovely curves and bends,
forever humming its mountain melodies.
But everything else has changed: the coppice wood at the
mouth of the glen is one sheet of varied and delicate
greens; the rough leaves of the hazels are intermixed with
the silver stems and small bright foliage of the birch;
sycamores are shaking out their broad leaves, creased and
puckered with their tight foldings in the buds, the oaks are
sunning their finely-cut leaves; and the ashes, last to come
and first to go, are waving their sprays in the breeze; while
the larches have long ago hung out their light green tassels,
and are now creeping up the sides of the mountain with
pointed crests, and in close array.
All color has changed, saving the dull dark hues of the time-
worn pines, and the grand and sombre masses of the
ancestral yews: what is the short summer of the dales to
them? It may be a fleeting joy for the ephemeral foliage
around them. It may make a holiday for the golden brooms,
and the hedges of snowy thorn, and the festal plumes of
the bird cherry. It may cause a flutter of excitement in the
sensitive sprays of the aspen, and make the green moss-
beds first all silvery with snowdrops, then all golden with
nodding daffodils and starry primroses, and again all blue
with bell-hung hyacinths, and pearly with the shy wood

anemone. But to them—to these dignified sires of vegetable
life, what is the fleeting influence of season? Hoary winter,
song-resounding spring, festal summer, golden autumn—
these can scarcely impart an added furrow, or wreathe their
stately brows with any passing glory.
Everything else, however, seems young and jubilant. Look
at the lambs upon the springy turf of the fells. They are
playing like kittens. No, better than that they are getting up
regular games of their own. There is system in that fun of
theirs. That fat, saucy fellow, white as snow, save for his
black nose and his legs, which seem to dance all the lighter
for their little black worsted stockings—he is evidently
master of the revels. He marshals his band on the top of
that old gray rock that bares its forehead from amidst the
elastic turf on the mountainside. There are some of the
young rebels who are determined to scale the height from
beneath in a wholly unauthorized way. That will never do;
the leader and his lambs line the ramparts, and butt and
push at every black nose that aspires upwards. The
aspirants are beaten back; and then down comes the whole
garrison, leaping, bounding up in the air "all fours" at once;
and sweeping away the opposing force, the whole lamb
community careers away in one troop down the green slope
of the fell.
This is thought to be rather too wild work by those
respectable old ewes, who, in their staid sobriety, have
altogether forgotten the days of their youth. They lift their
plain and anxious countenances from cropping the scented
turf, and, with mouths full of thyme and heath, utter a few
warning remonstrances, which only seem to stimulate the
wild frolics of the young folks. Surely they don't mean to
send that black, perfectly black lamb "to Coventry"? The
insolent little rogues, it really looks so. They won't let him
join in the fun, forgetting their own legs and noses: for they

are but quadroons themselves, at the best: and so he
retires to the genial society of his mother, in whose eyes he
seems to be white and comely as a lily. Really, it is rather
trying to think that these charming lambs will grow up into
those ungainly and uninteresting old sheep.
Alice's garden is brilliant with flowers. "'Tis but a common
cottage garden," you will say: no exotics, no rare and
delicate plants. But here are England's dear old favorites,
her best and choicest flowers. What can surpass those regal
"cabbage roses," so round and so full, or those moss rose-
buds growing under the lee of the white porch? Then there
are "sweet-williams," deep red and variegated, very stiff
and very handsome in their way: there are showy orange-
colored lilies and queenly white ones: there are purple
columbines, and great red peonies, and tall "Jacob's
ladders," and grave "Solomon's seals": there are graceful
sweet peas clinging for support to anything they can reach;
and a little bed of spicy pinks, scenting the air like an island
of the eastern seas. The beds are all edged either with box,
or with double red and white daisies, or with the little fragile
"witch's thimbles," chiming their small blue and white bells
to every passing breeze.
But there is something going on under the broad shadow of
the yew trees. On the smooth grass-plot which spreads
before Alice's rustic seat, stands the long kitchen table,
which must have been moved out of doors for festal
purposes, because it is covered with a clean white table-
cloth, and a number of chairs are placed round it. Plates of
piled-up bread and butter, cut and buttered currant "wigs,"
a massive-looking cake, whose consistency is very much
that of cold "figgy pudding," a beautiful dish of ripe
strawberries, dressed out with leaves worthy of a ducal
coronet *, and another dish of cherries from off the walls of
the house, furnish the entertainment. There is a tea-tray

also; and Mrs. Lawson's dozen of little old-fashioned silver
teaspoons have been taken out of the old oak chest and
rubbed up for the occasion.
* The strawberry-leaf is the ducal symbol, and is placed
on the coronet.
But who are the guests? The widow is there, sitting up in
her chair in considerable state as hostess; Alice, in simple
gala costume, is flitting about with a brilliant flush of
pleased expectation on her artless countenance; Mat is
gone in to rub up his merry face until it shines like a rosy-
cheeked apple, to comb his light hair down over his sun-
burnt forehead, and to put on his best red waistcoat, with
blue glass buttons, and his bright green neck-tie. Chance
and Laddie have made no such distinguished toilette, but
they are particularly on the alert, barking little gala salvos,
and pricking their ears at every sound.
There is a sound now in the distance—a slow rumble of
wheels in the direction of Green Gap. The dogs are violently
excited by this, because a friend, a great buff sheep dog,
with an enormous white plumy tail, always comes in
company with the rumbling "shandry" * from Scarf Beck
Farm. They are right in their apprehensions.
Mr. and Mrs. Hartley, a particularly comfortable, not to say
jolly-looking couple, are sitting up in the high-backed seat,
with Bella between them, and the young Hartley brothers
are walking in front. This is evidently a state visit; tea out
of doors at half-past three o'clock, and supper looming in
the background at seven.
* The "travelling carriage" of the country—half-cart, half-

gig.
We must have a photograph of Bella Hartley; for she is
called by many, the Queen of the Dales. She is taller by
half-a-head than young Alice Lawson, and of a far more
noble figure and carriage. Her features are finely-cut; and
her head, with its bountiful profusion of bright brown hair,
sits with remarkable grace on her long neck and finely
sloping shoulders. Her dress is a simple light print, with a
colored ribbon round her throat.
Ah! there is a little story attached to that rather faded
ribbon, and some amount of sentiment; or else it would not
have been selected for this especial occasion. She has a
grave, thoughtful, perhaps anxious look; but it has not been
always there. Her face was as sparkling as her own Scarf
Beck, until some twelve months ago, when, after a long and
painful talk with Miles Lawson, that care-worn expression
took up its settled abode on her lofty brow, and in her deep
shadowy eyes.
On that summer evening, a year ago, she had said to him,
"No, Miles, you must give me back my promise; for I will
never be the wife of a man that I cannot trust out of my
sight for half-an-hour."
And so they parted—he to grow more thoughtless and
reckless than ever, because he held himself to be an injured
man; she to watch over him from a distance with the folded
hands of prayer, and to weep and mourn in secret; while
she carried before her little mountain world a brow so calm,
and a manner so serene and collected, that folks said she
was unfeeling, fickle, and heartless.
Other young farmers, and one or two land or mine agents,
had paid their court in the meantime; but no one had been

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