Implications of Individual Freedom and Organizational Control to the Future Organization - Literature review Example

Implications of Individual Freedom and Organizational Control to the Future Organization Executive Summary The report comprises of an evaluation of the process of organizational control and its impacts on the employees and managers. The study suggests that the emerging organizations have adopted a control in their management process that involves control in the production, sales as well as the inventory management that depends on the consumer demands and supply. It reflects the control within an organization can be of various types and the managers need to control the work process in order to maintain the ethical aspects of the organization. Further the freedom of the employees within the companies inculcates self-confidence among the workers that is necessary for the employees to take up valuable decisions for the organization. The study has been carried out on various companies such as Apple Inc., Google and Aldi Inc. where the managers plan to incorporate various changes in order to compete with the rivals in the international organizations. The study suggests that freedom given to the employees is essential for them to develop various skills but there should be an organizational control in order to manage the change within the organization. However the control that is undertaken by the managers within the organization can enhance its performance despite the organizational change. Table of Contents Introduction 4 Implication of individual freedom in an Organization 5 Definition and Importance of Organizational Control 8 Opportunities and Challenges faced by the Organization 10 Freedom to bring in Organizational Change 12 Critical Analysis of the Organizational Change Management and Individual Freedom 17 Conclusion 20 Recommendation 21 Reference List 22 Introduction The control that the managers of the company undertake within the organization is necessary to develop a healthy work culture that is suitable for the employees. The characterization of an organization based of the pattern of controlling system that it follows is an important aspect which every employee within the organization faces (Alvesson and Willmott, 2002). A social organization is referred to an ordered arrangement of the individual as well as the human interactions. Control is not only related to the situation that takes place within the organization but also the situation that takes place in the external atmosphere of the organization. Freedom refers to the fact that individual’s behavior has an impact on the organization as a whole (Cardinal, 2001). Control may be among the individuals as well as among the group of members in order to carry out the project in a well-planned manner. Control also deals with the adjustment of the individual to the organization’s new rules and policies. It also brings in discipline within the organization that contributes to the reputation of the organization in the international market (Cardinal, Sitkin and Long, 2004). However a change within an organization is inevitable in order to compete with the rivals and hence the control that is generated within the organization is essential to bring in a change. The paper aims at discussing the implications of the individual freedom and organizational control to the future organizations. The report offers a scope to understand the various theories and case studies of different organizations related to individual freedom and organizational control. Implication of individual freedom in an Organization Freedom of an individual reflects the capacity to develop an understanding and self-consciousness about the job that is assigned to them. The freedom given to the employees in an organization reflects the trust that the organization has on its employees. Further the freedom given to the managers to take decisions that are favorable to the organization helps to build up the self confidence among them (Chen, Park and Newburry, 2009). By freedom of an individual in an organization indicates the extent to which the individual’s behavior can be controlled and the individual is free to determine the course of action. There are various cultural aspects that are followed by the organizations. There are culture theories dealing with the individualism as well as the collectivism of the organizations. The organizations are free to follow the individualism as well the collectivism. Collectivism indicates that the employees within the organization have the freedom to communicate with the customers in order to collect feedback from them and plan out the strategies for the enhancement of the performance of the organization (D’Cruz and Noronha, 2006). Thus the freedom given to the employees helps in their personality development as they have the opportunity to communicate with the other employees and the customers of the organization. The organizations that wish to compete in the newly emerging market grant absolute freedom to the employees to take decision that contributes to the progress of the organization as a whole (Yu, Tu and Pattipati, 2008). The companies have been focusing more on the modern values rather than the traditional values. It is the individual’s choice, personal freedom and self-actualization that enables the individuals to believe in themselves and participate in the decision making process. Study says that the survival of the company depends on the collectivism among the employees as well as the freedom focused values that are practiced by the employees. This indicates a cultural shift of the organization from the traditional values to the modern values. The study says that the future organizations are planning to permit the employees to take valuable decisions which would further enhance their capability to handle situations. The employees are even allowed to choose their domain of work so that they can perform their task efficiently. It raises the productivity of the employees and the company will be able to serve a large number of the customers and set up a huge business in the international market. The managers are also free to choose the target customers based on the customer loyalty as well as the products that are manufactured by the company (Kulp, et al., 2006). Freedom given by the organization to its employees can be of many types that are freedom to take valuable decision regarding the production and sales as well as the choice of the target customers. However the company must ensure that the freedom is given to the employees who are dedicated to their work. Likewise the newly emerging organizations carry out their projects in teams and the team leaders give entire freedom to the team members to communicate and discuss the issues related to the project because it is their belief that only communication can derive a solution to the particular problem (Cardinal, Sitkin and Long, 2004). Some of the modern day organizations even choose their work timings in order to adjust the timing according to the international clients and the employees are often made to work in shifts. This helps the organization to expand the business international markets and attract the international customers to purchase their goods and services (Chenhall, 2003). The freedom given to the employees can also help the managers to maintain a good relationship among them and the employees find it easy to approach the managers’ in case of any dispute. This situation is common in the small firms were there are few employees and they are able to communicate with each other without any barrier. However in case of the large firms there are several hierarchies and there is a wide gap between the employees and the higher authority. In case of the organizational conflicts the issue first reaches the supervisors and then to the mangers and finally to the higher authority. It takes a lot of time to reach to the solution of a particular problem. There are drawbacks to the freedom that is given to the employees as the employees may not be efficient to take valuable decisions and their wrong decisions may pose threat to the organization. The incorrect decisions may even affect the reputation of the organization and also may result in the loss of customer base of the organization. Further the freedom given by the team leaders to the team members to share their views may make some of the employees to be highly dominating and they try incorporate their own views in the final decision making process and thus de-motivates the other team members from participating in the decision making process (Luo, 2008). The study indicates that the freedom of the employees in organizations brings in positive as well as the negative impacts that in turn affect the social status of the organization. In 2014 Google was named as the ‘best company to work for’ as it serves a large number of the customers and the employees are highly motivated to choose their domain and work efficiently. The company also rewards the employees for their better work performance and the control undertaken by the mangers within the organization is transparent (Wrzesniewski and Dutton, 2001). The organizational control is such that it helps the employees develop a self confidence among them and the employees become ready to take up the challenges. The employees of Google are allowed to choose their projects that they find interesting to work on. The employees are given another freedom that they can come to the office according to their convenience (Luo, 2008). The work culture within Google is not about working all the time and the company allows the employees to participate in the extra-curricular activities that makes the employees more energetic to deal with the situation and also helps to avoid the monotony. Definition and Importance of Organizational Control In case an organizational change takes place within the company it is the control process undertaken by the company that helps the company to implement the change successfully. The process of controlling implies that the managers monitor the work process of the employees and regulates the efficiency of the employees in the organization (Markman, et al., 2005). While controlling the work process it is the duty of the managers to evaluate the effectiveness of the strategy that the managers have planned in order to achieve the organizational goals. Control process also comprises of the fact the activities of the employees helps in anticipating the events that might occur. It also involves the process of motivating the employees and focusing on the challenges faced by the organization (McDonald, Pini and Bradley, 2007). The importance of the organizational control lies in enhancing the productivity of the employees. The control system is needed to be maintained in an organization because without this it would be difficult for the managers to keep track of the overall performance of the organization. The organizational control also determines the quality of goods and services that are supplied to the customers (Cash and Gray, 2000). With the help of the control system the performance of the customer-contact employees can be determined that helps the managers to maintain a relationship with the customers. Controlling can also bring in innovation within the company and help the organization to mitigate the risk factors that would result in setting a huge business by in the international market. The control process within an organization are based on the stages that is the input, conversion and the output stage that are followed in four steps. The first step involves establishing the gals and evaluating the performance of the organization. In the second step the actual performance is measured based on the outputs that are generated by the organization. The third step involves the comparison of the actual performance with the chosen level of performance and the fourth step deals with the evaluation of the results and derives the corrective actions in case the standard of performance level is not achieved (Young and Thyil, 2009). Further, the output control by managers of an organization involves three steps are the financial measures, organizational goals and operating budgets. The initial step is about the financial measures adopted by the organization to evaluate the company’s annual performance and then the second step involves setting up the organizational goals based on the financial performance of the organization (Kassing, 2006). The second step also fixes the level at which the employees need to perform in order to achieve the goals. The third step is that of operating budgets that involve estimation of the actual budgets for the process followed to fulfill the vision of the organization. However there are problems faced by the managers for the output control as the managers need to take care of the effectiveness of the process that is to be followed by the organization. In case of the organizational changes that are adopted by the top managers the planning process has to be changed and the manager need constantly monitor the change. Another type of the control system is that of the behavior control of the employees in the organization. The attitude of the employees towards the management process is also necessary to be controlled because it may create barrier to the smooth functioning of the organization. The steps under behavior control involve direct supervision by the managers of the organization as the managers supervise the subordinates to enhance the organizational performance (Ind, 2003). However the challenges that the managers’ face while adopting the behavioral control is that the process seems to be very expensive as they can monitor only a small number of employees and so the research suggests that the company prefers output control as compared to the behavior control (Luo, 2008). In such cases the research suggests that the bureaucratic supervision is essential in order to control the management process. It is a process that comprises of a set of rules and standard operating procedure that helps to regulate the behavior of the individuals. The managers are responsible to develop the rules and regulation related to the behavioral characteristics of the employees so the employees follow the rules for the growth of the companies. Opportunities and Challenges faced by the Organization The organizations while conducting its business faces a number of challenges that are mainly handled by the managers. The managers may find it difficult to utilize the knowledge and skills efficiently in the work carried out by the organization. Further the ability of the managers also gives evidence of being good team leaders in order to manage the team performances (Park, 2003). The success of the managers also depends on their participation in the decision making process as well as the performance of the team members in the organization. However the opportunities for the managers and the employees can be that they are able to take up challenges and find out the solutions to the problems that the company faces. This enhances their thinking as well as the decision-making capability and they can take valuable decision for the company. Nonetheless a controlled environment plays a key role in the planning process of the managers to adopt strategies to bring in the organizational change. The training provided by the managers to the employees also helps the employees to initiate control in their work process and allocate time for the various steps that are followed by the managers. The organizational ethics also suggests that the individuals working in the organization should be allowed some freedom to take decisions that are beneficial for the organization because this would impart them with self confidence to face the challenging situations. The freedom given to the team members to share their views reflects the trust that the company has on its employees. The trust of the company on its employees in turn motivates the employees to utilize their talent and skills to deliver a better performance (Homburg and Pflesser, 2000). The study shows that the challenges that the managers and the employees faces in an organization in turn raises the self-confidence that enhances their productivity. The freedom given to the employees to take decisions during the challenging situations allows the employees to develop an organizational learning process regarding the efficient way to utilize the skills and knowledge in solving the problems. There are two approaches to the employee performance management that is based on the managers of the company. The approach depends on the relationship of the workplace factors to the individual’s performance in the organization. The two approaches are as such that focus on the factors related to the situation that facilitates the performance of the employees and the other situational factors that creates a barrier to the employee performance. There is another model that the organizations follow is that of the motivational model on enhancing the job performance of the employees (Zahra, Hayton and Salvato, 2004). The model analyses the performance of the employees based on the motivation provided to them by the managers and a conclusion is derived regarding whether the motivation provided by the managers have enhanced the performance of the managers. Freedom to bring in Organizational Change It is always necessary to bring in a change within the organization in order to make it compete with the rivals in the international market. As the company progresses it develops a huge customer base in the economy and the demands of the customers rises. Hence the company needs to take up strategies in order to raise its production levels so that the company is able to serve a large number of customers. However the company needs to control its production levels based on the demands of the customers. The controlling of the production system implies that the company controls the level of output that is to be generated. Figure 1: Porters Five Forces Analysis follwed by Organizations (Source: Zahra, Hayton and Salvato, 2004) According to the Porter’s five forces model analysis a company faces a lot of challenges that can be categorized into five segments that are competition with the rivals in an industry and due to the similar type of goods produced by large number of companies there is a threat of potential entry of the rival firms in the market that would make the company lose its business (Zahra, Hayton and Salvato, 2004). The third segment deals with the buyer power that is the capability of the buyers to purchase more goods and the next segment is that of the potentiality of the suppliers to supply the raw materials in the international market. The final segment of the Porter’s five forces analysis that the company has to take into consideration is the threat of the substitute goods in the international market. The companies such as Samsung, Nokia and the Apple Inc. that produce smart phones are competing with each other in the international market and it is the Apple Inc that has won the smart phone business and has captured a large market share (Zahra, Hayton and Salvato, 2004). Figure 2: Annual Sales of Apple Inc. (Source: Chen, et al., 2014) As a result the other two competitors Samsung and the Nokia had to control their production levels based on the customer demands for smart phone. The control of the production is necessary in order to save the company from running at a loss. These companies mostly have some efficient leaders who are free to take valuable decisions that are in favor of the companies so as to save them from going bankrupt. The managers are also free to take decisions regarding the shift of production to some other good that would attract the target customer and help the company to set up its international business. The decision making is an important aspect that the company needs to undertake at any point of time when the company is running at a crisis. The characteristic of an efficient manager indicates that the person can prove to be a good decision maker and the company can grant the freedom of participating in the decision making process. The study reveals that control can be of various types that are based on the management of the organization. In case the company is running at a loss there situations where there is a need to control the use of raw materials for the production as well as the output that is produced. Further there is another type of control system that is adopted which helps the organization in conducting the change management is to identify the potentiality of the individual to be a team leader (Zahra, Hayton and Salvato, 2004). This is another essential control system adopted by the companies to carry out projects smoothly such that the clients are satisfied and no dispute arises within the company. However the control system also depends on the planning process that is undertaken by the supervisors to mitigate the risk factor faced by the company which is likely to lose its shares in case it fails to satisfy its customers. Figure 3: Kotters eight step analysis of Change (Source: Zahra, Hayton and Salvato, 2004) The change management process in an organization is carried out based on the Kotter’s eight step change model which involves eight different steps of implementing a change. The change is brought by the managers of the companies who are free to take the decision related to the change. The first step involves that the managers should identify the necessity of the change management in the organization. Once the field is identified, the next step is to form a group to discuss the change that is to be brought within the organization. The latter steps involve creating a vision for the change management and communicating the vision of change to the team members. Then the employees are to be motivated to act according to the vision of the organization and the final steps involve the planning and implementation of further change within the organization (Ignatiadis and Nandhakumar, 2009). For example Tesco Inc, a UK based grocery shop has set up its business by satisfying a large number of customers but the company has recently undertaken a change that is a shift to its online business where is can serve the customers from all over the world and it would be able to expand its business. The company has been highly successful in implementing the change within the organization. The change brought within the company has raised its annual sales and the company has been earning a huge profit to the rise in customer base. Another company that has undertaken the change management and has followed an organizational control in the production process is that of the Apple Inc. Study suggests that the managers of the company has the authority to take the production decisions and the company was an initial manufacturer of the Mac notebooks and desktop computers and later the company has shifted its business to the production of smart phones that are on high demand by the customers (Ignatiadis and Nandhakumar, 2009). However the company has faced a lot of competition with the other rivals smart phone producers but due to the strong organizational control the company has been successful in producing quality goods and satisfying its customers. Therefore the managers of Apple Inc. are efficient enough to be granted the freedom to take up decisions that are advantageous to the company as a whole. The company is further planning to expand its business to the other parts of the world and the managers are responsible to take up strategies that help in manufacturing products that attract the target customers. Figure 4: Annual Sales of Google (Source: Chen, et al., 2014) Likewise there is some other company named Google headquartered in US that has been undertaking a strong organizational control to plan out strategies for the improvement of the services that it provides to the customers. The examples indicate that the modern organizations prefer to provide complete freedom to the employees such that they can undertake a controlled management process and work according to the strategies planned by them. Critical Analysis of the Organizational Change Management and Individual Freedom The Organizational change management in a company is essential in order to make the company overcome the challenges that it faces due to the expansion in the international market. The change can be brought in various ways but the change has to be favorable to the employees as well as managers so that they are well versed with the technological change. However the authority must maintain a controlled environment in order to undertake the organizational change so that the change is well implemented in the organization (Luo, 2008). The impacts of the change can be beneficial as well as harmful depending on the type of change that takes place. The impacts can be controlled and most of the organizations allow their employee the freedom to take part in the decision making process and successfully implement the change. The decisions are to be taken on various fields related to the progress of the organization. The feedback given by the customers is also essential to bring in an organizational change such that the company can manufacture goods as per the desires of the customers. The ethical culture maintained in the organization is important to motivate the employees to perform well and the good ethical culture can be controlled by the managers so as to set up a reputation of the company in the international market. The ethics within an organization involves that the employees are free to choose their work domain and they are free to take the decisions regarding the strategies to be used. The ethical aspects also comprises of the flexibility in the work timing that is provided to the employees so that they are comfortable with their timings that would improve their productivity. For example Apple Inc. used to initially manufacture desktops, notebooks etc but later as a result of the customers’ high demand of smart phones in the international market the company has started its production of smart phones. However the company has not been fully successful in gaining its market share because it only focuses on the upper middle class population who wish to have the purchase luxury items like the expensive smart phones from the international market (Luo, 2008). Nonetheless the company enjoys a competitive advantage in producing smart phones as compared to its rivals. The company has successfully implemented the control over its production process so as the meet the rising customer demands in the international market. The study suggests that the company’s production levels are at equilibrium as the company’s supply meets the demands for smart phones. There is another supermarket company named Aldi Inc. that is headquartered in Germany which supplies its customers with a wide range of products to the customers and brands that the buyers can choose from (Young and Thyil, 2009). The company follows a controlled management process that takes up strategies regarding the level of production and sales to be maintained based on the customer demand for the company’s products. The strategies implemented by the company can be compared with that of the Bowman’s Strategy Clock that consists of various strategies that the companies undertake (Young and Thyil, 2009). Figure 5: Bowmans strategy clock for Aldi Inc. (Source: Young and Thyil, 2009) The supervisors of Aldi Inc. undertake strategies of product differentiation as well as selling products at low costs in order to attract large customers. The product differentiation strategy adopted by the company allows the customers to choose from a large number of brands. The company also serves the goods at low prices so that the customers visit the stores regularly (Young and Thyil, 2009). The managers of Aldi Inc. also maintain a customer relationship management in order to create a good reputation in the international market. By attracting a lot of customers the company has raised its annual sales and has successfully set up its business through the organizational control that it undertakes. Further the study on the organizational control management implies that a party within the organization influences its control on the other organization. It comprises of the impact of the supervisors’ actions on the workers so as to enhance the performance of the employees. The organizational control often faces barriers as there are varying interests of the employees and the managers. Resolving these conflicts is an important aspect that every organization must deal with and the individuals are often provided with the freedom to resolve these conflicts. However the freedom given to the employees includes a number of responsibilities that the employees and the managers need to take up that it gives full freedom to the employees to act as the entrepreneurs and coordinate the work activities. It involves the enhancement of the organizational responsiveness and improving the efficiency the team members to produce successful business activities. There are certain critical elements of the freedom that is to be maintained within the organization which comprises of the mindset of the individuals working as team leaders. The long-term interests of the team leaders and their dedication towards the job assigned to them (Chen, Park and Newburry, 2009). The individual as well as the business needs are to be complemented and the freedom given to the employees to take decisions must be self-responsibility which involves the important issues contributing to the organizational success factors. The organizational issues that needs to be considered focuses on the missions of the company and the aspirations of the stakeholders. The employees need to establish the objectives that maximize their productivity and their competency to perform well. The freedom also grants the authority to carry out the daily responsibilities with the approval of the management within the organization. The study has also revealed that there are several dimensions of freedom given to the employees an organization that states that the employees must have freedom to develop and achieve the required potentiality to deliver a good performance. The freedom can be of the mistakes that the employees make within an organization and to question the authority and investigate in case of any controversy (Chen, Park and Newburry, 2009). The employees are allowed the freedom to take decisions and they are expected to be free from limitations regarding the work hours. However the control needs to be generated within the management process in order to maintain discipline within the organization. The freedom and control are both necessary to maintain a healthy relationship of the managers with the employees and enhance the work culture. Conclusion The research has been carried out on the organizational control and the employee freedom that is provided by the future organizations. The organizational control is necessary to be initiated when there is a possibility of the change that is to be brought to the organization. The employee freedom that the companies provide to most of its employees comprises of various types of freedom that is flexibility in the timing as well as the freedom to choose the domain for their job. This would enhance the productivity of the employees in the organization which would in turn contribute to the performance of the employees in the organization. Further the control generated by the organization can be of various types depending on the performance of the organization and the attitude of the employees towards their job. Recommendation The research indicates a detailed analysis of the organizational control and freedom that the newly emerging organizations offer to their employees. Though it shows that the freedom given to the employees enhances their skills and knowledge as well as the decision making capacity of the employees that is beneficial to the organization but further analysis needs to be carried out regarding the negative impacts of freedom provided to the employees. It is highly recommended that an evaluation process can be conducted based on the performance of the organization and the types of organizational control undertaken that can prove to be useful to the organizations. Reference List Alvesson, M. and Willmott, H., 2002. Identity regulation as organizational control: Producing the appropriate individual. Journal of management studies, 39, pp. 619-644. Cardinal, L. B., 2001. Technological innovation in the pharmaceutical industry: The use of organizational control in managing research and development.Organization science, 12(1), pp. 19-36. Cardinal, L. B., Sitkin, S. B. and Long, C. P., 2004. 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