Term Paper on "Business Strategic Management"

Term Paper 6 pages (1781 words) Sources: 5 Style: APA

[EXCERPT] . . . .

Business Strategic Management

Corporate Governance Styles

Up until recently, the manager has been regarded as the "boss." On numerous occasions even, he was the actual owner of the company. This manager's main objective was to register profits as increased as possible and to cut down costs as mush as he could. However, the contemporary corporations are trying to implement the perception of a friendly manager, one that does not talk down on people nor tells them off whenever they've done something wrong. The manager is no longer the owner of the company, but he is a hired individual, one extremely well trained and with intensive expertise. His job is to coordinate the employees, to develop and implement the best strategies for the company and to effectively use all available resources.

The skills and capabilities required from a good manager are various and they refer to all technical knowledge of the company's area of work, managerial skills as well as emotional intelligence. The concept of emotional intelligence was only recently added to the business dictionary by Dr. Daniel Goleman and it refers to the personal features of a manager, such as his social skills and abilities to communicate and relate to other individuals.

Depending on the personal features of the managers as well as the level of management they implement, numerous managerial styles have risen. Based on the managers' personal features, the management can be autocratic or permissive. Based on the level they work on, that is low level management, middle level management and top-level management, leaders can implement the following styles: operational management (low), tactical management (middle) and strategic management (top-level). Management styles implemented by boards of directors and top managers include chaos management, entrepreneurship management, marionette management, and partnership management.

2. Chaos management

In order to understanding the concept of chaos management, one needs to look upon the following terms: chaos, complexity and issue storms. These three features all influence the management styles and a combination of them has generated the chaos management style.

The specialized literature defines chaos as "the irregular, unpredictable behavior of deterministic, non-linear dynamical systems." A translation of chaos into a managerial act implies that there are numerous unknown variables that affect the organization and that these variables are sometimes difficult to prevent, foresee or measure. The new variables generally refer to the increased amounts of information and the problems their rise is the employees' difficulty in handling the new information. "The relevant generalization here is that we live in an uncertain and turbulent environment and, even with massive amounts of available information, it has become increasingly difficult for us to choose appropriate organizational survival behaviors."

The second concept that helps the definition of the chaos management style is complexity. The managerial Complexity Theory states that "critically interacting components self-organize to form potentially evolving structures exhibiting a hierarchy of emergent system properties." This theory establishes two organizational operation modes: stability and instability. The chaos management style is prone to generate on the unstable operational mode.

Third, the issue storms that generate chaos within an organization refer to the "swirling, turbulent flows of information that blow up when people try to deal with complex issues." The issue storms have been generated by a great development of Information Technology contrasted with stagnancy in the field of managerial and organizational technologies.

The best way for a manager to handle a chaotic situation is to follow the next five steps: - "assess the situation; assess the options; get input from smart and knowledgeable people; determine a direction and make decisions; execute."

This particular style of management is generally more common amongst organizations that focus their activities on extremely volatile features. A relevant example of such organizations is the stock jobber.

3. Entrepreneurship management

The entrepreneurship management style is implemented by the top managers who decide upon the new directions of the organization. Entrepreneurial managers have to be extremely well trained in order to analyse and seize the company's opportunities. They make decisions such as the company's expansion, purchases, investments, mergers and acquisitions. Entrepreneurial managers have great responsibilities and are obliged to confront operational and tactical managers as well as the board of directors before making any decision.

This leadership style has only recently been emphasized on, as there arose the need for managers to possess entrepreneurial skills and for the entrepreneur to possess managerial skills. This necessity was brought about by the continuously developing and demanding economy and it is both applauded as well as loather. Advocates of the management style point out the similarities between entrepreneurial and managerial thinking and go as far as to state that the entrepreneur and the manager have similar objectives. Disclaimers of the management style however disagree and they point out the significantly increased risks of being an entrepreneurial manager.

An entrepreneurial manager is preferred to the classic manager as he has the ability to see the overall situation and make the best long-term decisions. Also, he understands the changes that occur at macroeconomic level and has the ability to identify the needs for change within the company.

Most economists believe that the entrepreneurial manager is mostly common among small companies that do not financially afford to pay two different men to perform similar duties. These situations are generally met within young companies established by students of fresh graduates. However, advocates of entrepreneurial management state that the usage of this management style is more common that initially believed and that it can be extremely useful in the following situations:

large firms, helping them to be more innovative technology commercialization, bringing new products to market small firms, helping to grow rapidly business turnarounds where they need to become more entrepreneurial franchises non-profits (the hottest area for entrepreneurship today) government family businesses buying an existing business starting your own business."

4. Marionette management

The concept of marionette management was only recently introduced to define a long lasting situation. Marionette management, also called undermanagement, refers to the poorly done job of some managers. These individuals carry the name of managers, but they do not share similar responsibilities to those of the classic manager. Not only that they do not have appropriate responsibilities, they even wrongfully handle the ones they have.

The action of the marionette managers is marked by "shocking and profound lack of daily guidance, direction, feedback, and support for staff from those who are their immediate supervisor. Undermanagement is costing organizations a fortune every day. It robs so many employees of the chance to have positive experiences in the workplace, reach greater success, and earn more of what they need and want. It causes managers to struggle and suffer and deliver sub-optimal results. It sours dealings with vendors and customers. And it costs society in so many ways."

Marionette management is a concept and a style that should be entirely eliminated from business activities. However, given the human nature, this is not easy to do. Marionette managing style can appear in any organization that does not implement a strict but fair top-level management. This style of management is most common among organizations that hire employees and promote them based on nepotism.

5. Partnership management

The partnership management style fully embraces the concept of a friendly manager that is not the boss, but the partner and collaborator of both the corporation's executives, as well of their employees. This management style goes even further from that and actually proposes partnership agreements to the company's best managers. Based on their performances and accomplishments within the corporation, some managers will be selected by the board of directors to join the company as partners.

By becoming a partner, the manager will benefit of a higher wage and he will be presented with increased responsibilities. Furthermore, he will benefit of a portion of the company's overall profit, but he will also share the adherent risks with the other partners and shareholders. The idea behind this style of management is that managers view this opportunity as a promotion which increases their satisfaction at the work place. Allowing a manager to become partner is the recognition of his worth and a statement of trust in his judgement. Furthermore, once the manager becomes a partner, he is more motivated to increase his performances. This type of management is most common among law businesses.

6. Conclusions

In a nutshell, chaos management implies leading in unstable conditions and with difficulties in keeping up with the changes. This style requires resilient managers and it most common among stock jobbers. The entrepreneurial management requires the manager to possess the skills of an entrepreneur and it is most common among small newly formed companies. The marionette management regards inadequate managers and it is most common among companies that promote nepotism. And finally, the partnership management allows managers to become partners and it is most common among law businesses.

Bibliography

Daniel Goleman, October 20, 2006, Cram 101 Textbook Outline for Primal Leadership: Learning to Lead With Emotional Intelligence, First edition, AIPI Publishing

Management Styles, Rensselaer Polytechnic Institute, http://www.rpi.edu/dept/advising/free_enterprise/business_structures/management_styles.htm, last… READ MORE

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