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Thursday, November 26, 2009

Factors of Change

Discuss major factors which are responsible for change in an organization ? how the successful organisation maintained their success ?

Ans: In the last two decades there has been a change in organizations for some very good, mutually supporting reasons and the one needs to find ways of managing, suited to specific, strategic circumstances.

What are successful organization ? in the business world, they have three characteristics:

• They are more profitable than their counterparts,
• They are growing faster than their competitors, and
• They are recognized as leader of at least some part of industries.

Most important of all, is there any reason to hope for a renaissance of management that can create a better world ? This is question where the rule and not the exception, is successful organizations run by happy people; where the goals of organizations inspire passion and not problems, where leaders coach and counsel rather than command and control; and where we know hoe to sustain these characteristics in the face of intensive competition and wrenching change, so that future generations do not have to repeat the pain and suffering being experienced throughout the world or organization today. dealdashtips

There are reasons why we live in difficult times, that there is a discipline – grand strategy – to bring it about. Grand strategy is therefore about the transformation of the management itself. Its purpose is to find a superior way of managing the ultimate competitive advantage.

In is clear that any attempt to understand a corporation’s operations must necessarily involve an in-depth discussion with the Chief Executive who heads the corporation. It is often said that an organization is a long shadow of its Chief Executive. However it is suggested that though the statement might somewhat hyperbolic, there is no doubt that so long that they are in position- they exert an enormous influence on the strategies, style, values and objectives of their respective corporations. It was therefore, essential for developing understanding about excellence of a company; the exercise must involve a discussion with the Chief Executive of the selected companies. While it is true that they provide strategies for long-term thinking about the future of the corporation, it is also true that since, in the final analysis, they are accountable for the performance of their corporations; their ability to think objectively is often influenced by the various events relating to the corporation in which they are prime actors. Asking a chief executive to evaluate the quality of the managerial excellence of his own corporation is almost like requesting the prime actors in a play to be both the viewer and the critic; yet given his level of involvement, the actor can provide an insightful perspective and thinking about the play which the audience and the critics may not be able to perceive. This will particularly be the case if he is a method school’ actor totally immerged in the role, who lives and breathes the character that he portrays. Exhaust Centre Reading Cheap Exhaust Centre Reading Cheap Exhaust And Tyre Centre Reading

Another set of perspective observers about the corporation are its lower level managers and employees who have greater degree of detachment and, therefore, are able to bring to bear greater objectivity to their assessment. In this context, depending on the career path of the concerned employee, he could see organisation’s operation through rose-tinted glasses if he is a successful manager on the make or be a bitter critic, if he feels or imagines that the corporation has failed to recognise his talents of misjudged his contribution. The elements of bias therefore very real also in lower level managers’ or employees’ comments, particularly if the concerned manager of the employee aspires to greater status and recognition.

The customers, suppliers, distributors and dealers are the most unbiased assessors of a company, which deals with them extensively. A customer who buys- and continues to buy- the product of a company, particularly non-consumer goods, has deep understanding of the managerial processes in the operation of suppliers corporation. Similarly, suppliers to these companies often have understanding and insights not only about the product and managerial processes, but also about the nature, strategies and values of such companies which are truly unique. Perhaps the quality and the depth of their observations are derived from the fact that they also supply goods and services to the competitors of the company. The analogy is also applicable in relation to dealers and distributor of the products of the company since it is likely that they also deals with the products of the company’s competitors.

In a study by S.K. Bhatacharya (1989) of all the available published material relating to operations of Reliance company appearing in the financial press were analyzed. Advantage was taken of interviews with several Reliance dealers, distributors and suppliers in obtaining the required comments, including their understanding about the managerial strategies, styles and systems of that company.

In the initial stage, several brainstorming sessions were conducted with the members of the team on the one hand, and with individual members of the advisory committee on the other, to obtain a feel for the various factors which contribute to a corporation’s excellent managerial performance. A search of the published material was also conducted to benefit from the thinking reflected in the research experience in this regard. However, most of the conclusions turned around somewhat generalised aspects of a corporation’s operations in identifying their contributions to managerial excellence.

Some of these dimensions identified as factors of change in earlier research publication related to:

• Long term corporate objectives
• Culture and value
• Management style
• Business strategy
• Organisational structure
• Management system
• Quality of human resources
• Working climate and
• Leadership

While many of these dimensions appeared to be extremely interesting issues and aspects for conducting in-depth analysis, the fact remains that they were often not clearly definable and there was no frame work which could weave them into a coherent and consistent fabric of organisational reality. This difficulty arose out of the inability to put them in specific forms or issues which could be clearly conveyed to the persons to be interviewed or specific questions which could be shared in advance for briefing the persons to be interviewed.

Further analyzing and additional rounds of brainstorming led to the conclusion that some of the following could be viewed as overarching factors of changes for achieving managerial excellence:

1. Corporate Objectives :

a) Corporate objectives that go beyond the conventional statements of quantified goals like percent growth rate or return on investment or profitability %
b) Objectives, encompass a strategic vision of the future environment
c) Identifying its opportunities in the marketplace with clarity, and capitalize on these opportunity effectively and efficiently.

2. Culture and values :

a) Kinds of values and aspirations that form the guiding force of the company.
b) Values relating to high standards of performance and work ethics reinforced among employees.
c) Rules bound and bureaucratic culture prevails or is it one, where formalization of procedure is kept to the minimum people relating a spirit of entrepreneurship and risk taking.
d) Value of innovation and its incorporation by managers.
e) The degree of ‘customer orientation’ in the company and how the customer orientation is reflected in the company’s operation, structure and system context.

3. Decision-making and communication progress:

a) The extent of delegation and decentralization in the company. Is delegation encouraged, and does it take place without interference in the delegated task ?
b) The extent, process and quality of communication among the managers. What are the formal and informal mechanisms that result in effective and speedy communication ? value of time as resource.

4. Business and policy objectives :

a) Are the company’s functional (eg finance, personal, R & D etc. ), strategies consistent with each other ?
b) The company’s strategic response to change in the external environment (especially changes in govt. policy competition and consumer preference) and their success in the past.
c) The rate in terms of numbers) of new product development, and the time taken.

5. Work organization :

a) Structure resulting in clarity of relationships and simplicity and ease of management.
b) Structure allowing for problems solving and entrepreneurship.

6. Personal (or Human resources) Management:

a) Promotion or rewards based on consideration of merit or performance.
b) Policies the company adopt so as to allow for personal growth of the employees (job enlargement, job rotation etc.)
c) The extent of motivation and level of morale and commitment among employees especially lower level operatives.
d) The record of the company in managing its industrial relations situation ?
e) Sense of commitment of employees to achieve the organizational goal extent it is self-generated or it is reward based.
f) The ability of the employees to share credit and recognition for achievement as a group rather than as individuals.
McKinsey, being one of the premier management consulting outfits in the world, had decided to mount an in-house study headed by Thomas Peter in mid-seventies for identifying factors which contributed to organizational effectiveness. The notion prevalent at that time was that organizational effectiveness was basically a function of the three hard Ss namely Strategy, Structure and Systems. This was a very conformable situation since all three were susceptible to change by deliberate or conscious direction by the top management and could be changed by fiat. However, the real life experience was that change in strategy, structure and system by themselves did not lead to substantive improvement in organizational effectiveness. The McKinney 7-S modes developed during this study identified four new dimensions which equally important in this context, namely:

Super ordinate goals
• Style
• Staff
• Skill,

However, this new type of view of organization not merely represented an advance in terms of identifying these four dimensions which influenced the hypothesis that the interaction of these seven organizational factors, and balance achieved between them determine organizational effectiveness.


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