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Principles of Mgt Basic Managerial Roles and Skills Managers must wear many different hats in formulating and implementing task activities related to their positions. In an attempt to understand the diversity of hats managers must wear, Henry Mintzberg examined managerial activities on a daily basis. His study enabled him to identify ten different but, coordinated sets of behavior, or roles, that manager assume. These ten roles can be separated into three general groupings: interpersonal roles, informational roles, and decisional roles. INTERPERSONALRole Three of the manager's roles come into play when the manager must engage in interpersonal relationships. The three roles of figurehead, leader, and liaison are each necessary under differing circumstances. Adopting one or another of the three interpersonal roles is made easier by the formal authority the manager obtains from the organization. The figurehead role is enacted when activity of a ceremonial nature is required within the organization. A baseball manager attending a minor league all-star game, the head chef of a prominent restaurant greeting customers at the door, and the president of a bank congratulating a new group of trainees are all examples of the figurehead role. While the figurehead role is routine, with little serious communication and no important decision making, its importance should not be overlooked. At the interpersonal level, it provides members and non- members alike with a sense of what the organization is about and the type of people the organization recruits. The second interpersonal role, the leader role, involves the coordination and control of the work of the manager's subordinates. The leader role may be exercised in a direct or an indirect manner. Hiring, training, and motivating may all require direct contact with subordinates. However, establishing expectations regarding work quality, decision-making responsibility, or time commitments to the job are all outcomes of the leader role that are indirectly related to subordinates. Quite often, managers are required to obtain information or resources outside their authority. The liaison role(Coordinating) is enacted when managers make contact with other individuals, who may or may not reside in the organization, in order to complete the work performed by their departments or work units. An auto assembly plant supervisor may telephone a tire supplier to determine the amount of inventory available for next week; a prosecuting attorney may meet with the presiding judge and defense attorney to discuss the use of motions and evidence in a libel trial; or a college professor may meet with professors in a separate department on campus to obtain information on a prospective doctoral student. Ultimately, the liaison role enables a manager to develop a network for obtaining external information which can be useful for completing current and future work activities. INFORMATIONALROLES Monitor, disseminator, and spokesperson are the three informational roles that a manager may assume. These informational roles are created as a result of enacting the set of interpersonal roles already described. A network of interpersonal contacts with both subordinates and individuals outside the work unit serves to establish the manager as an informational nerve center of the unit, responsible for gathering, receiving, and transmitting information that concerns members of the work unit. A manager assumes the monitor role by continually scanning the environment for information or activities and events that may identify opportunities or threats to the functioning of the work unit. Much of the manager's gathering of information is achieved through the network of contacts that has been established through the interpersonal roles. Hearing small talk at a banquet about a competitor's planned marketing program, learning through casual conversation at a ball game about the negative medical evaluation of an unsigned ball player, or daily reading of a business periodical are all examples of the kinds of information gathering involved in the monitor role. The information a manager gathers as a monitor must be evaluated and transmitted as appropriate to members of the organization. The transmittal of information by a manager activates the disseminator role. Privileged information may be disseminated to subordinates, peers, or superiors in the organization. The manager may inform the marketing vice-president about the specific marketing strategy a competitor is planning to implement. A baseball manager may inform the team owner that an impending trade should be canceled because of the unfavorable medical report on one of the players. Or reading The Wall Street Journal may inform the manager that a shipping strike is looming and thus enable her to inform subordinates that temporary layoffs may occur next month. Occasionally, a manager must assume the spokesperson role by speaking on behalf of the work unit to people inside or outside the organization. This might involve lobbying for critical resources or appealing to individuals who have influence on activities that affect the work unit. A top manager asking the board of directors to keep the work unit together during a reorganization period or a corporate president speaking to a college audience on the role the company plays in education would both constitute engaging in the spokesperson role. DECISIONALROLES Both interpersonal and informational roles are really preludes to what are often considered to be a manager's most important set of roles: the decisional roles of entrepreneur, disturbance handler, resource allocator, and negotiator. The entrepreneur role comes into action when the manager seeks to improve the work unit. This can be accomplished by adapting new techniques to fit a particular situation or modifying old techniques to improve individual or group activity. Managers usually learn of new or innovative methods through information gathered in the monitor role. As a result, a supervisor purchases a new kiln which will shorten the drying process for ceramic tiles; a director of a youth club trains staff in the use of personal computers to increase file access; or a president establishes a new pension plan to improve employee morale. Whereas the entrepreneur role establishes the manager as the initiator of change, the disturbance handler role establishes the manager as a responder to change. Organizations, unfortunately, do not run so smoothly that managers are never called upon to respond to unwelcome pressures. In these cases, the manager is required to act quickly to bring stability back to the organization. A law partner must settle a disagreement among associates in the firm on who will present a case before a judge; a personnel director must negotiate with striking employees dissatisfied with the procedures for laying off employees; or a cannery first-line manager must respond to a sudden shortage of cans used to package perishable fruit because the supplier has reneged on a contract. When a manager is placed in the position of having to decide to whom and in what quantity resources will be dispensed, the resource allocator role is assumed. Resources may include money, time, power, equipment, or people. During periods of resource abundance, this role can be easily performed by a manager. In most cases, however, organizations operate under conditions of resource scarcity; thus, decisions on the allocation of resources can be critical for the success of the work unit, division, or organization. As a decision maker, the manager must strive not only to appropriately match resources with subordinates but also to ensure that the distribution of resources is coordinated to effectively complete the task to be performed. An office manager must provide secretaries with appropriate equipment to generate and duplicate documents. A manager of a fast-food restaurant must coordinate work shifts to have the maximum number of employees working during the lunch hour. Corporate presidents may provide their administrative assistants with decision-making responsibility for day-to-day matters. In addition to decisions concerning organizational changes, disturbances, and resources, the manager must enact a negotiator role. The process of negotiation is possible only when an individual has the authority to commit organizational resources. Hence, as managers move up the managerial hierarchy and obtain control over more resources, they become more involved in the negotiator role. For example, the president of a record company may be called in to discuss terms of a possible contract with a major rock group; a production manager must negotiate with the personnel department to obtain employees with specialized skills; or a college dean must negotiate with department heads over course offerings and the number of faculty to be hired. The relative emphasis a manager places on these ten roles is highly dependent on the manager's authority and status in the organization. Length of time on the job, position in the management hierarchy, goals of the subunit to be achieved, and skills the manager possesses all play a part in determining which roles are more prominent than others at any given time. For instance, a marketing manager is more likely to emphasize the interpersonal roles because of the importance of personal contact in the marketing process. A financial manager, charged with responsibility for the economic efficiency of the organization, will probably focus on the decisional roles. A staff manager, or a manager who performs in an advisory capacity, is likely to be more heavily involved in the informational roles. Regardless of the differences that may occur, however, all managers enact interpersonal, informational, and decisional roles while performing their tasks. Effectively managing an organization is a demanding task. Managers not only must develop skills related to the functional areas of management but also must learn how to integrate these activities. What makes this process demanding is that events and activities external and internal to an organization can radically change the techniques and methods managers must use in order to arrive at successful outcomes. Managers cannot afford to be limited in their view of management, nor can they simply rely on how things were done in the past. Even the most seasoned and successful managers are prone to mistakes. However, a more complete knowledge of the managerial process can reduce the chances of mistakes that will have dire consequences for an organization. Such knowledge may help managers to better plan, organize and staff, direct, and control organization activities within the context of their organization. Managerial Skills What makes a good manager? Innate traits or acquired skills? Assuming that a manager is one who directs the activities of other persons and undertakes the responsibility for achievement of objectives through such efforts, successful management seems to rest on three basic developable skills: technical, human and conceptual. The relative importance of these three skills varies with the level of managerial responsibility. (See diagram, below.) Technical Skill The technical skill implies an understanding of and proficiency in a specific kind of activity, particularly one involving methods, processes, procedures, or techniques; it involves specialized knowledge, analytical ability within that specialty, and facility in the use of the tools and techniques of the specific discipline. Vocational and on-the-job training programmes largely do a good job in developing this skill. Human Skill This refers to the ability to work with, understand and motivate other people; the way the individual perceives (and recognizes the perceptions of) his superiors, equals, and subordinates, and the way he behaves subsequently. The person with highly developed human skills is aware of his own attitudes, assumptions, and beliefs about other individuals and groups; he is able to see the usefulness and limitations of these feelings. He is sufficiently sensitive to the needs and motivations of others in his organization so that he can judge the possible reactions to, and outcomes of, the various courses of action he may undertake. Human skills could be usefully divided into (a) leadership ability within the manager's own unit and (b) skill in intergroup relationships. Experience shows that outstanding capability in one of these roles is frequently accompanied by mediocre performance in the other. Intragroup skills are essential in lower and middle management roles and intergroup skills become increasingly important in successively higher levels of management. To acquire the Human Skill, the executive must develop his own personal point of view toward human activity so that he will (a) recognize the feelings and sentiments which he brings to a situation, (b) have an attitude about his own experiences which will enable him to re-evaluate and learn from them, (c) develop ability in understanding what others by their actions and words are trying to communicate to him and (d) develop ability in successfully communicating his ideas and attitudes to others. The process of acquiring this ability can be effectively aided by a skilled instructor through use of case problems coupled with impromptu role playing. It is important that the trainee self-examines his own concepts and values, which may enable him to develop more useful attitudes about himself and about others. Conceptual Skill This skill involves the ability to see the enterprise as a whole; it includes recognising how the various functions of the organization depend on one another, and how changes in any one part affect all the others; and it extends to visualizing the relationship of the individual business to the industry, the community, and the political, social and economic forces of the nation as a whole. The conceptual skill involves thinking in terms of the following: relative emphasis and priorities among conflicting objectives and criteria; relative tendencies and probabilities (rather than certainties); rough correlations and patterns among elements (rather than clear-cut cause-and- effect relationships). Training can enhance previously developed conceptual abilities. In developing the conceptual skill, some of the best results have been achieved through "coaching" of subordinates by superiors. One way a superior can help "coach" his subordinate is by assigning a particular responsibility, and then responding with searching questions or opinions, rather than giving answers. Another excellent way to develop this skill is through trading jobs: by moving promising young men and women through different functions of the business but at the same level of responsibility. Special assignments, particularly the kind which involve inter-departmental problems, can also help develop this skill. Relative Significance of Managerial Skills Conceptual Conceptual Conceptual Human Human Human Technical Technical Technical * Supervisory level Middle mgmt level Top mgmt level * Technical skills are not so important for the chief executives in large organizations where such executives have extensive staff assistance and highly competent, experienced technical operators are available. In smaller organizations, however, where technical expertise is not as pervasive and seasoned staff assistance is not available, the chief executive has a much greater need for personal experience in the industry. A Realistic Description of Managerial Work Minzberg concluded that 1> Senior management jobs are open-ended, managers feel compelled to tackle a large workload at demanding pace. there is little free time. Breaks are rare. Escaping from work after hours is physically/mentally difficult. 2> The work is fragmented, full of brevity & variety with a lack of pattern. Managers confront the law of the trivial many and the important few (80/20 principle). Behaviors must change quickly and frequently; interruptions are common. 3> Managers seem to prefer this and become conditioned by workload. Opportunity-costs of time (urgencies) are keenly felt and superficiality in relationships is a hazard. 4> There is an activity-trap - managers tend towards current, specific, well- defined, non-routine activities. Processing mail is a pain; 'non-active' mail gets little attention. Current information (chat, speculation) is preferred - routine reports are not. Use of time reflects close, immediate pressures rather than future, broader issues. Fire-fighting (reacting to immediate stimulus) is a problem. Live action pushes the manager away from thinking and planning. Verbal contacts and media are preferred over written. written. Written communications get cursory treatment, but must be processed regularly. Less goes out than comes in. It moves slowly. There are long feedback delays. (How does E-Mail fit in?) Subordinates outside spoken lines of contact may feel uninformed. Informal media (telephone and unscheduled meetings) are used for brief contacts if people know each other well and when quick information exchange is called for. a. Scheduled meetings eat up managerial time - long formal duration, large groups and often away from the organization. The agendas cover ceremonials, strategy- making and negotiation. Chatting at start/end of meetings contributes significantly to information flow. b. Managers seldom 'tour' yet WTJ (walking the job) enhances 'visibility' & understanding of the actuality of work and production/service methods, standards and problems. c. Managers as boundary managers, link his/her own organization with outside networks. External contacts (clients, suppliers, associates, peers, informer networks) can consume 30-50% of a senior manager's time. Non- line relationships are also important. THE NEW WORKPLACE (changing culture of organization ) For any organization to dedicate the time and effort it takes when changing workplace culture there must be a strong business case to drive the momentum. The business case will come from either the business under-performing or wishing to excel beyond its current performance. Once a business case is established it is much easier to entice the senior leadership to become the champions for change. Without their full and unswerving support your success at changing workplace culture is severly threatened. Set Up Team Charters and Expectations When you are changing workplace culture there are four teams that have quite distinct roles. These teams are: The Steering Team:- Responsible for establishing boundaries and guidelines for the Design Team. Approving the recommendations of the Design Team. It should consist of a cross section of key leaders, decision-makers and stakeholders. The Design Team:- Responsible for completing the analysis of the current situation, making recommendations. Should have representatives from both leadership and front-line team members The Implementation Team:- Responsible for implementing the recommendations and transforming it from it's current state to the ideal state. Wide-spread involvement is critical to ensure that the plan is effective and all team members embrace it. (It is critical that the leadership teams are very much included throughout the entire process to ensure their buy-in, which is all important, because of the influence they bring to bear on the entire organization. If a leader is unable to support the change, then s/he should be willing to leave of his/her own accord) The Renewal Team:- Responsible for assessing the degree to which the implemented recommendations have achieved what they were designed to achieve. Make recommendations for further change efforts as required. Often members of the Renewal Team include members from the Design Team and the Implementation Team. The Consultant:- Responsible for educating the teams in the models, analysis tools and methodologies that are available to assist cultural change. Provide guidance to ensure the change effort stays on course. Provides expertise regarding sources of information and alternative choices. Describe The Vision Once the Steering and Design Team has been brought together and given their charter it is time for the Vision for the Future is described. At the end of this body of work, clearly defined will be the Behaviors, Values, Principles and Mindsets that the organization will adopt in the future. It is important that the members of these teams stay open to this being modified as the Design Team delves further into the re-design process. Review Current State At this point time is spent analyzing the external environment, social and technical systems and identifying the Symbols, Rituals and Legends that create the culture of the organization. To attempt changing a workplace culture without also considering the organizational design, is to commit yourself to much activity, but achieving little real progress. The systems that you use perpetuate beliefs about 'how we work around here'. The interactions of the various systems and organization design choices you have made will either facilitate or impede the cultural changes you are attempting to implement. Educate and Energize This is a critical step in changing workplace culture that many organizations don't do, or do poorly. Education of every single member within the organization on the need for cultural change, the 'how' you are going to go about changing the workplace culture and the benefits to be gained by changing workplace culture must be done: over and over and over. To energize people the education needs to step far beyond the mere logic of "this is why we need to change and this is how we need to change". The education needs to engage people's hearts. It needs to begin to influence people's values, mindsets and beliefs and ultimately enable them to change their behaviors. Many organizations shy away from this 'warm and fuzzy' stuff. However, leaders in high performance organizations realize that 'this stuff' is the framework upon which greatness is built Traditional and contemporary issues and challenges We discuss historical perspectives on management thinking and seeks to explain why these are important to today’s managers. Integrating the best from both experience and theory and learning from the mistakes of the past are key elements of success in any human endeavor. Management is no different and, as students of management, it is important to be aware of the historical views on management. This provides a basis from which to understand current management thinking, and to critically evaluate, challenge and advance management theory. The text introduces the key perspectives of traditional managerial thought and then discusses modern management approaches, seeking to integrate the most appropriate of each approach to individual situations. The ruling managerial paradigm is to select from all of the tools and theories available to managers those that best suit the complex combination of variables in any one situation. The role of theory and history in management The text goes to some trouble to explain why theory and history are relevant to contemporary managers. Theory is a conceptual framework for organizing knowledge and providing a clean print for action. Given this, any manager must develop some theory of management to be able to operate. It is therefore counterproductive to dismiss theory as irrelevant. A manager needs to seek to understand various theories and adapt and utilize those components that he or she believes are of value to a particular situation. The same logic applies to the value of studying the historical developments in management. Ignoring the insights available from the rich source of historical management thinking and experience may cause managers to spend time solving problems to which solutions already exist. Management thinking is directly related to the social norms, economic conditions and political forces of the time and place. It follows, therefore, that in understanding management theories of the past and present it is useful to gain an appreciation of the social, economic and political context in which they were developed. All past human civilizations that left evidence of their existence — from ancient Egyptians to the Hebrews in the time of Moses — demonstrated management practices, and many left detailed descriptions of their management practices. It would appear that management is a natural outcome of human beings interacting to achieve a common goal. Management as a recognized discipline of commerce emerged fully in the late 1800s and the early 1900s with the development of large corporations. The scientific study of management developed in the 1800s, through the thinking and activities of pioneers such as Robert Owen, Charles Babbage and Andrew Urea. This era was characterized by a focus on the technical aspects of managing organizations by management practitioners. Frederick Taylor was the first to shift the focus to include a theoretical approach. The classical management perspective Historical perspectives on management are discussed under the three areas of classical, behavioral and quantitative perspectives. The classical management perspective was the first well-developed framework for understanding management and consists of the two distinct branches of scientific management and administrative management. Scientific management was aimed at improving the productivity of individual workers. Scientific management was pioneered by Frederick Taylor who analyzed the time taken for each task and introduced payment based on the level of productivity of each worker. Using his scientific methods of measurement and management, many American companies made huge efficiency gains by adopting and optimizing mass production techniques. While his approach was later criticized because it led to boring, repetitive jobs and tended to ignore the individual, it was a cornerstone of the new discipline of management. Later practitioners spread the scientific management doctrine and built on Taylor’s work. Administrative management is the other branch of classical management thinking. Unlike scientific management that concentrates on the jobs performed by individuals, administrative management focuses on managing the whole organization. Henri Fayol, a French industrialist, became the best known of the administrative management school. Fayol was the first to identify the managerial functions of planning, leading, organizing and controlling that are still regarded as the fundamental activities of management. The framework of classical management was the basis of later theory and many of its elements hold today. However, organizations and the market were relatively simple ands table compared to modern organizations and markets. The classical approach therefore provides a good basis for many elements of management but does not sufficiently address aloof the issues relevant to the organization of the 21st century. The behavioral management perspective Behavioral management shifted attention from the largely mechanistic view of employees and work held in classical management to the psychology, attitudes and behaviors of individuals. A leading figure of behavioral management was Hugo Munsterberg, whose focus on psychological testing for selection and motivation in management are commonplace today. The Hawthorne Studies lent credence to the behavioral approach by studying a group of workers. The workers’ levels of illumination were increased, resulting in increased output. When the light was decreased, however, output continued to increase. It was discovered that employees were working harder because of the attention they were receiving. Thus, psychological factors were seen to be an important factor in worker output. The human relations movement was an evolution of the behavioral approach that concentrated on the social context of the workplace. Much of the work in the area of motivation theory comes from this movement, including the work of Maslow (Maslow’s hierarchy of needs) and McGregor (Theory X/Theory Y). Organizational behavior emerged from human relations by integrating elements of other disciplines such as psychology, sociology and medicine. This recognizes the complexity of human behavior and takes a holistic view of individual, group and organizational processes. The behavioral management approach provides important insights into the importance of motivation, group dynamics and interpersonal processes in organizations, as well as the need for management to focus on these. However, the complexity of individual and group Study Guide to accompany behaviors makes prediction of that behavior, and management decision-making to influence that behavior, very difficult. The quantitative management perspective The quantitative management perspective, a more recent development than the other two major perspectives, uses applied mathematics to address logistical problems of organisations.The focus is on analytical processes of decision-making, economic effectiveness, mathematical modeling and the use of information technology. Management science uses mathematical modeling to represent and analyze systems, processes and relationships. Operations management is concerned with the efficient production of goods and services of the organization, The quantitative management approach provides very powerful tools for understanding and managing organizations. It does not fully explain or predict the behaviors of individuals or groups of people within an organization. Integrating perspectives for managers It is obvious that classical, behavioral and quantitative approaches have all made valuable contributions to the theory and practice of management. Contemporary management seeks to integrate these approaches in ways that suit the particular organization at a particular time. A thorough understanding of management requires an appreciation of all three perspectives Systems theory and contingency theory take this integration approach. The systems approach describes the organization as a system that transforms inputs (material, human, financial and information resources) into outputs (e.g. products/services, profits/losses, employee behavior and information) by use of managerial and technological processes. The overall system can be broken into sub- systems, such as production and finance. The objectives are effective and efficient operation of each of the sub-systems, to maximize the synergy between the sub-systems and to avoid entropy (the natural tendency for systems to decline over time). The contingency approach essentially argues that the traditional perspectives on management are too narrow in defining how to manage organizations. It suggests that the best managerial approach to each particular situation is dependent on a large number of elements and therefore managers should seek the approach that best suits the specific situation they are facing. The text suggests that the broader approaches to management taken by the systems and contingency approach have most relevance to the manager of the 21st century who faces complex and rapidly changing environments. Contemporary issues and challenges It is interesting to note that no totally new conceptualization of management has emerged to completely replace the traditional perspectives on management. Regardless, managers continue to seek new insights into how to better lead, motivate, organize and control their organizations. It is interesting to speculate on whether the majority of contemporary management thinking and writing is advancing management thinking or simply educating the next generation of managers. In other words, are we really becoming better at management or simply struggling with the same issues managers have always faced and simply defining new terms and descriptions of the solutions? Most likely there is a mixture of both. the text identifies a number of best-selling books published in the past two decades that are considered essential reading for students of management. Reading a selection of these provides a breadth of understanding of issues relevant to today’s managers. Two common themes in this contemporary management literature are speed of responsiveness and individuality in orientation. The challenges faced by managers today include downsizing, managing diversity, the speed and nature of change faced by individuals and organizations, and new technology. The globalization of the economy, a complex array of approaches to organizational design, the shift to a services orientation in the economy and the re-emergence of ethics and social responsibility as a prime concern of businesses all present significant challenges, and opportunities, for managers at all levels in all organizations It is important for managers to see their education in management as a lifelong process. Most readers of this text and Study Guide will be managers in several different companies and/or in several different industries throughout their career. The broader an individual’s understanding of the external environment, and the greater their depth of managerial experience and knowledge, the more value they can add to any one organization and the more transportable their skills are across industries. The Environmental Context of Management Key Forces in the External Environment Introduction No organization can exist in a vacuum; each is set in a particular country and region to which it is inextricably linked. This setting provides multiple contexts that influence how the organization operates and how and what it produces. Thus, the concept of "external environment" is an important consideration for organization as it attempts to understand the research it supports. An analysis of the external environment is an attempt to understand the forces outside organizational boundaries that are helping to shape the organization. Forces outside the institution's walls clearly have considerable bearing on that which transpires within. The external environment can provide both facilitating and inhibiting influences on organizational performance. Multiple influences in the immediate or proximal environment form the boundaries within which an organization is able to function; these influences likewise shape how the organization defines itself and how it articulates what is good and appropriate to achieve. Key dimensions of the environment that bear on the institution include the administrative/legal, technological, political, economic, and social and cultural contexts, the demands and needs of external clients and stakeholders, and relations with other pertinent institutions.. Administrative/Legal Environment The administrative and legal environment in a country provides a framework within which an organization operates. In some countries this environment is very restrictive and has significant impact on all aspects of the organization; in other countries the administrative/legal context is more permissive. Understanding the administrative/legal environment is essential to determining if organizational change can take place. The administrative context within which the organization operates may be shaped by a unique combination of forces, including international, governmental, nongovernmental policy, legislative, regulatory, and legal frameworks. An organization is affected by the policy or regulatory context that gave rise to it. This includes specific laws and regulations that support or inhibit the institution's development. Several specific dimensions of the administrative environment should be examined: Whether there are constitutional restrictions on the organization: An assessment should first determine whether the organization is part of a government ministry or department, and whether it is under federal or provincial jurisdiction. Whether specific regulations govern the goals and structures of the organization: It is important for organization to know if the organization has a specific mandate and/or a specific structure that has been imposed. Whether there is a legislative mandate that restricts leadership of the organization: It is helpful to understand any parameters that have been set around who can lead an organization. This includes identifying the governing body of the organization, and understanding how its members are selected, and further understanding who has the mandate or authority to set goals for the organization and develop curriculum. Technology Environment Both the types and the level of technology in the society give insight into understanding an institution. Institutions dealing with Western paradigms are dependent on the state of national infrastructure, e.g. power, water, transport; those which concentrate on indigenous research paradigms may have totally different dependencies. Thus, it is important to understand the level of relevant technology in the institutional context and whether such technology is defined by computer literacy or by highly developed indigenous methods of verbal and nonverbal communication. It might also be helpful for an assessment to include a consideration of the process by which new technology comes into use, both to understand how difficult it is to acquire needed research technologies and to develop an appreciation for the society's willingness to embrace both new knowledge and change. Political Environment At a general level, organization needs to understand the relationship between governmental strategy or development plans and the institution. Several specific dimensions of the political context should be scrutinized: The extent to which government and its bureaucracy supports and contributes resources to the institution: It is imperative that an organization and other agencies know whether significant governmental inputs are anticipated to support increased staffing, maintenance, or other recurring costs typical in research projects. The political context usually entails resource trade-off decisions at the government level. The extent to which the political system is stable or poised to undergo significant change: This factor is vital; the foreign policy context and its effect on organization should also be considered. Whether the political context of the institution directly involves the legal context: Some institutions require specific legal status to operate, to receive external funding, and to import equipment in support of research. Economic Environment In the economic environment, the organizational analysis should centre on those aspects of the economic system that directly impact the type of project being considered. For example, inflation, labour laws, and opportunity costs for researchers in public institutions directly impact organizational activities. Clearly, a country under a structural adjustment regime or one that is expecting to undergo restructuring presents an investment context that an organization needs to understand. Countries with foreign currency restrictions represent different environments for institutions than countries without them, for such restrictions have ramifications for research, Social and Cultural Environments Social and cultural forces at local, national, and often regional levels have profound influence on the way organizations conduct their work and on what they value in terms of outcomes and effects. For example, the mores of an indigenous culture have a bearing on the work ethic and on the way in which people relate to one another. Undoubtedly, the most profound cultural dimension is language. The extent to which organizational members can participate in the discourse of the major scientific language will determine the extent to which research efforts focus inwardly or contribute to regional and global research agendas. Understanding the national/regional/local values toward learning and research provides insight into the type and nature of research that is valued. For example, what is the relative priority placed on contract research in partnership with local clients, e.g. testing products and procedures with indigenous populations, as opposed to sharing information with academic peers internationally, or generating biostatistical data that will shape national or regional policy? Arriving at these priorities involves culture-based decisions. Stakeholder Environment Although research institutions tend to be driven by the research mission and the process of achieving it, all institutions are dependent for their survival on various groups of stakeholders. The stakeholder environment consists of those people and organizations external to the research institution who are directly concerned with the organization and its performance. Examples of stakeholders are suppliers, clients, sponsors, donors, potential target groups, and other institutions doing similar or complementary work. An organizational analysis seeks to learn the identity of these groups in order to assess their potential impact on the organization. Because of its international interdependent dimension, contemporary research relies on institutional relationships, and these need to be understood. Thus formal and de facto relationships with universities, government departments and agencies and other research institutions both within and outside the country need to be understood. Influences from these multiple environmental contexts can become major facilitating or constricting forces on the institution as it works to accomplish its mission. In the extreme, these forces can keep an institution alive artificially; conversely, they can thwart organizational survival Internal environment of Organization Organizational Resources These are all the inputs physical or human used in the organization to create outputs in the firm of product or services through a transformation process. Some other resources of organizations are money, facilities, systems, knowledge, materials and manpower. The cost and availability of these resources are important factors that determine the success of an organizations policy and strategy. Organizational Behavior These behaviors an organization demonstrates as a result of influences and forces operating in the internal environment of determine the ability or constraints in the usage of resources is termed organizational behavior. Synergistic Advantage This is a situation where the whole is greater than the sum of its parts within an organization. 1 + 1 = 3. it is a situation where attributes do not add up mathematically but combine to yield an enhanced or reduced impact i.e. (synergistic effect).Two or more department could combine to support each other, in order to realize higher output or to share an impact within the organization. For instance, marketing, distribution and promotion may support each other for higher level of marketing strategy. Conversely, marketing inefficiency on the other hand, reduces production efficiency (dysentery) i.e. negative synergy occurs. Strengths and Weaknesses The strength of an organization are the attributes the organization has over another organization. The strength gave the organization the competitive edge over another in the same industry, while weaknesses are areas within the organization where the competitors in the same industry can take advantage of as their competitive edge. Distinctive Competence This is a comparative quality of one organization over the other. A distinctive competence of an organization is the ability of that firm to do what its competitors cannot do or do better whet they can do. This concept is useful for strategy formulation. Use of trained and qualified manpower could be an organization distinct. Competence over the other who may resolve o use the unskilled and low paid workers. Functional Strategies This strategy is relatively a restricted plan which spells out the specific function, for the allocation of resources among different competing operations within the functional areas. This is necessary because it fosters easy co-ordination for optimal contribution to the achievement of the business and corporate level objectives. Functional strategies are obtained from the business and corporate strategy which are implemented through functional or operational strategy. A very important task of strategy implementation is to align or fit the activities and capabilities of and organization with its strategies. Strategies are operated at different levels and there has to be congruence and coordination among these strategies. Such a congruence is the VERTICAL FIT. The congruence and coordination among the different activities taking place at the same level is the HORIZONTALFIT. Vertical Fit: Discussions on vertical fit will make it necessary to define functional strategies in terms of the capability of the functional strategies to contribute to the strategic advantage of the organization from which it is derived. Below are some of the functional strategies. i. Strategic marketing management which implies the focusing on the alignment of marketing management within the organization alongside its corporate and business strategies to gain a strategic advantage. ii. Strategic financial management focusing on alignment of financial management within an organization with its corporate and business strategies to gain a strategic advantage. iii. Strategic operations management – This implies focusing on the alignment of operations management within an organization with its corporate and business strategies to gain a strategic advantage. iv. Strategic human resources management means focusing on the alignment of human resource management within an organization with its corporate and business strategies to gain a strategic advantage. v. Strategic information management means focusing on the alignment of information management within an organization with its corporate and business strategies to gain a strategic advantage. Horizontal Fit: This means that there has to be integration of the operational activities undertaken to provide a product or service to a customer. This can only take place in the course of operational implementation. Operational Implementation: It is the approach adopted by an organization to achieve operational effectiveness. When an organization engaged in (value creating activities) optimally and in a way which is better than its competitors. It results in operational effectiveness. Ability of organization to achieve operational effectiveness has a lot to do with its effective coordination of its (value chain). Value chain is a set of interlinked value creating activities performed by organization. These activities may begin with the activity of procurement of basic raw materials and include the act of processing in its successive stages right up to actual end of the product which may be marketed to the ultimate consumer. The value chain of a manufacturing organization is divided into primary and support activities. Primary activities are directly related to the flow of products to the customer and include (5) sub-activities. (i) Inbound logistics (receiving and storing, etc) (ii) Operations – transformation of raw materials into finished products (iii) Outbound logistics (order-processing, physical distribution etc) (iv) Marketing and sales (pricing, promotion etc) (v) Service – (installation, repairs etc) Support activities are provided to sustain the primary activities. These consist of the infrastructure (including, finance, accounting, general management etc) human resource management, technology development and procurement. The consideration of vertical fit and horizontal fit help to explain why integration is necessary for the different subsets of functional strategies. Functional Plans and Policies The beauty of business strategy or corporate strategy is the extent to which it can serve as direction to functional managers regarding the plans and policies to be adopted. Infact, the effectives of strategic management depends critically on the manner in which strategies are implemented. Need For Functional Plans and Policies Among so many reasons for functional plans and policies, Gluck has suggested five reasons to show why functional plans and policies are needed. These are: 1. To ensure that strategic decisions are implemented by all the parts of an organization 2. There is a basis for controlling activities in the different functional areas of a business 3. The time spent by functional managers on decision making may be reduced as the plans lay down clearly what has to be done and the policies provide the discretionary framework within which decisions need to be taken 4. Similar situations occurring in different functional areas are landed by the functional managers in a consisted manner. 5. Coordination across the different functions takes place where necessary. Functional Strategic Planning/(Check List) Financial Plans and Policies The financial plans and policies of an organization are related to the availability, usage and management of funds. Strategists need to formulate plans and policies in these areas so that strategies may be implemented effectively. Some of these checklists in the financial resources of an organization are: Sources of funds Usage of funds Management of funds Sources of Funds This refers to sources of financing or capital-mix decisions. Plan and policies have to be directed at major factors as: capital structure, capital procurement and working capital borrowings; reserves and surplus as sources of funds. These plans and policies are important for determining the financial strengths or weakness of an organisation. Usage of Funds Plans and policies for the usage of funds deals with investment or asset-mix decisions. The major considerations that are relevant here are: Capital investment Fixed asset acquisition Current assets Loans and advances Dividends decisions and the relationship with shareholders The management of funds is an important area of financial plans and policies it basically deals with decision related to the systematic aspects of financial management. The major areas related to the management of funds are: i) System of finance ii) Accounting and budgeting iii) Management control system iv) Cash v) Credit vi) Risk management vii) Cost control and reduction viii) Tax-planning and advantages Marketing Plans and Policies Plans and policies related to marketing have to be formulated and implemented on the basis of 4ps of marketing mix, that is, product, pricing, place (distribution) and promotion. The major issues and decisions related to these marketing mix factors are question such as: (i) What types of product to offer? (ii) At what prices? (iii) Through which distribution channels? (iv) By which of the promotional tool? Product: Product denotes the goods and services that an organization offers to its target markets. Plans and policies related to product and markets need to be formulated and implemented on the basis of characteristics such as quality, features, choice of models, brand names, packaging and so on. Pricing: Pricing denotes the money customers pay for exchange of goods and services. It is important to the seller because it is the reward for his efforts. To a buyer, price is the value that is assigned to the satisfaction of its needs and wants. Several price characteristics, such as, discount, mode of payment, allowances, payment period, credit terms, and so on, affect pricing plans and policies. Place: Place (or distribution) is the process by which goods or services are made available to the customers. Distribution plans and policies address themselves to issue, such as the channels to be used; transportation, logistics and storage inventory management, coverage of market and so on. Promotion: This deals with the marketing communication intended to convey the company’s and its product’s or service’s image to prospective buyers. A promotional mix consists of four activities advertising, personal selling, sales promotion and publicity. Production System: The production system is concerned with the capacity, location, layout, product or service design, work systems, degree of automation, extent of vertical integration and other factors. Operations Planning and Control: Plans and policies related to operations planning: materials supply, inventory, cost and quality management: maintenance of plant and equipment. The aim of strategy implementation is to see how efficiently resources are utilized and in what manner the day-to-day operations can be managed in the light of long term objectives. Research and Development Plans and policies for research and development deal with product development, personnel and facilities, level of technology used, technology transfer and absorption. Technological collaboration and support, and so on.Research and development is sued in strategy implementation as a foundation for implementing strategies like product development and diversification. Personnel Plans and Policies Personnel plans and policies relate to the personnel system, organizational and employee characteristics, and industrial relations. Personnel System: Plans and policies related to the personnel system deal with factors like manpower planning, selection, development, compensation, communication and appraisal. Information Management Plans and Policies Information capability factors relate to the design and management of the flow of information from within and outside into an organization. The value of information as a tangible resource and as a source of strategic advantage has been recognized by organizations.Other area of information management are acquisition and retention of information which regards the processing and synthesis of information with factors such as the sources, quantity, quality and timeliness of information retention capacity and the security of information. Having examined not serious analysis on the functional areas earlier mentioned it would be necessary to evaluate the organizational strengths and weakness for decision making on the basis of the following: Evaluating an organization’s strengths Common ORGANISATIONAL STRENGTH A common strength is an organizational capability possessed by numerous competing firms. For example all the major strong wood film studios possess common strength in lighting sound recording, set and costume design and make up. Competitive parity exists when large numbers of competing firms can implement the same strategy. Thus a firm company that exploit sonly its common strengths in choosing and implementing strategies is not likely to go beyond average performance. Distinctive Competences A distinctive competency is a strength possessed by only a small number of competing firms. Distinctive competencies are rare among a set of competitors. Organizations that exploit their distinctive competencies often obtain competitive advantage and attain above-normal economic performance. Distinctive competencies are competencies that could be found in the functional areas in the organization. For example in finance, personnel, research and development; marketing and information management organization weakness can be evaluated in forms of skills and capabilities that do not enable an organization to choose and implement strategies that support its mission.Organisations have essentially two ways of addressing weakness. First, it may need to make investments to obtain the strength required to implement strategies that support its mission, secondly, it may need to modify its mission so that it can be accomplished with the skills and capabilities that the organization already possesses.
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