Principles of Management
Code
1200
Academic unit
null
Department
null
Credits
7,5
Teacher in charge
Antònio Nogueira Leite; Bernardo Pimentel
Teaching language
Portuguese and english
Objectives
This course is intended for undergraduate students and provides an introduction to the different functional areas of management, emphasizing, namely, the way Economics can be used for the decision-making in a business.
Prerequisites
N/A
Subject matter
I. The firm and the market.
1. Definition of the firm. History of the firm. Horizontal and vertical boundaries [BDSS, ch.2] [JM, ch.1];
2. Value Maximization. The law of supply and demand. [BDSS, In- troduction] [JM, ch.2,4].
II. Costs, revenues and profits - Economics primer.
1. Costs: cost functions, variable and fixed costs, average and mar- ginal costs, short-run and long-run. Economic costs and accounting costs. [BDSS, pp 10- 24] [JM, ch.6];
2. Demand and income, price elasticity of demand. Total revenue and marginal revenue. [BDSS, pp 24-25] [JM, ch.3, 5];
3. Theory of the firm: determining the output level and the price. [BDSS, pp 26-28];
4. Perfect competition. [BDSS, pp 28-31];
5. Introductory concepts of Game Theory: Nash equilibrium and sub- game perfection. [BDSS, pp 31-35].
III. Finance.
1. The balance sheet and the income statement [JM, VI-A];
2. Basic notions of finance: interest rate, capitalization and discount; current and constant prices; performance measures of an investment [JM, VI-B].
IV. Strategic analysis I.
1. Market structure and competitive pressure. [BDSS, part 3, ch.11];
2. Barriers to entry [BDSS, part 2, ch.8];
3. Vertical relationships: suppliers and clients [BDSS, part 2, ch.8];
4. Market segmentation [BDSS, part 3, ch.9];
5. Strategic positioning: cost leadership, di?erentiation and niche. [BDSS, part 3, ch.9].
V. Strategic analysis II.
1. Resources and competencies [BDSS, part 3, ch.11];
2. Unique resources and sustainability of the competitive advantages [BDSS, part 3, ch.11];
3. Technology, disruption, innovation, and competitive positioning [BDSS, part 3, ch.11].
VI. Marketing.
1. The role of marketing in the organization and its relation with strategy;
2. Pricing policies [JM, ch.11];
2. Advertisement [JM, chs.10-12].
VII. Human resource management.
1. Shareholders, managers, and employees: roles and incentives [BDSS, part 4, ch.12] [JM, ch.9];
2. The principal-agent problem [BDSS, part 4, ch.12];
3. Performance measurement [BDSS, part 4, ch.12].
VIII. Governance.
1. Fundamental of corporate governance [BDSS, ch. 4] [ESSP, ch.1];
2. Actors and institutions of corporate governance [ESSP, ch.2];
3. Mechanisms of corporate governance [BDSS, ch. 2] [ESSP, ch.3].
IX. Entrepreneurship.
1. Entrepreneurial ability and risk preferences. Di?erentiating fac- tors of the entrepreneur. The JoT entrepreneur. [class notes];
2. Disequilibria and entrepreneurship. Opportunity recognition and exploitation [class notes].
X. Managing operations and inventory management.
1. Managing Operations: fundaments of operations management [HRM, ch.1];
2. Inventory Management. Purpose of inventory management. Types of inventory. Costs. The EOQ model [HRM, ch.12].
Bibliography
[BDSS] Besanko D., D. Dranove, M. Shanley and S. Schaefer, Economics of Strategy, Wiley, 6th edition, 2013.
[ESSP] Esperança J.P., A. Sousa, E. Soares and I. Pereira, Corporate Go- vernance no Espaço Lusófono, Texto Editora, gestão, 2011.
[HRM] Heizer J., B. Render and M. Chuck, Operations Management, Pearson, 12th edition, 2017.
[JM] Mata J., Economia da Empresa, Fundação Calouste Gulbenkian, Lisboa, 9th edition, 2016.
Teaching method
The course comprises of two lectures and one practical session per week. In the lectures, the theoretical material is presented and discussed with the help of examples. The practical sessions serve the dual purpose of solving exercises developed from the theoretical material and of presenting the company reports written by the students during the course of the semester.
Evaluation method
The assessment will be based on a final exam (50%) and on a component done over the course of the semester (50%). This component consists of a midterm test (20%); three written reports on Strategy, Finance, and Mar- keting (15%); a group presentation of one of the reports (10%); and the individual participation of the students (5%). The resit exam has a 100% weight on the final grade.
The minimum grade on the exam is 8/20.