Motivations of Managers in Small- and Large Firms - Essay Example

Motivations of Managers in Small- and Large Firms are not Totally Different Introduction Each business entity, regardless of the size of the business, has a significant contribution towards the economic growth. In most cases, it is the managers who are mainly responsible over the success of the business. To enable the readers to have a better idea with the subject matter, the main purpose of establishing a business will be tackled in the study. Eventually, the importance and major differences between small- and large-scale businesses such as in the case of the multinational corporations (MNCs) and the transnational corporations (TNCs) will be thoroughly discussed. In the process of going through the discussion, the differences between the ownership, goals, and business organization including the business activity of small- and large-scale businesses’ external environments will be compared and contrast. Prior to conclusion, a literature review will be conducted to briefly discuss the qualities and role of an effective manager within the small- and large-scale company followed by gathering some evidences that will prove that motivational approaches for managers who works in small- and large companies are not totally different from one another. Main Purpose of Establishing a Business including the Importance and Major Differences between Small- and Large-scale Businesses Whether a company is small- or large-scale, the main purpose of establishing a business is to earn large sum of profit. Earning profit is not solely dependent on increasing the company’s annual sales; the ability of the manager to maximize the use of its existing resources also contributes a lot when it comes to increasing the amount of profit a company can generate each year. Aside from the major differences between the corporate structure of small firms and large multinational companies (Poon & Swatman, 1996), it is a common knowledge that large-scale businesses are able to acquire bigger credit line from banks as compared to small-scale businesses. Since small-scale businesses have limited financial resources that can be used in operating the business. For this reason, managers within small-scale companies are not fully able to maximize the benefit of economies-of-scale (Allon & Gurvich, 2008). Large-scale businesses such as in the case of multinational corporations (MNCs) and the transnational corporations (TNCs) have the financial capacity to invest on highly competitive human resources and support employees’ needed training and development aside from investment on newly innovated communication and production technology and the benefit of purchasing of raw materials by bulk. In other words, managers who are working in large-scale companies can easily take advantage of its economies of scale based on the industry standard (Allon & Gurvich, 2008). Since small-scale business are unable to compete with the relatively low market prices offered by large-scale businesses, small-scale businesses are left with no other choice but to improve the quality of their service as a way of increasing customers’ loyalty. Another way wherein small-scale companies are able to compete with the large-scale businesses is to increase the work efficiency of its available human resources. This can be easily achieved by having managers with good leadership skills. Comparison between the Differences of Ownership, Goals, and Business Organization including the Business Activity of Small- and Large-scale businesses’ External Environments With regards to business ownership, small-scale businesses are usually owned privately by a group of family members and/or the minorities which includes the group of women entrepreneurs. On the contrary, large-scale businesses are usually owned by the stockholders who are composed of the business owners and a large group of public investors (Rich, 2006: p. 605). Business goals and objectives of small- and large-scale MNCs and TNCs significantly differ from one another. In most cases, managers behind small-scale businesses are aware of the company’s limitations when it comes to the capacity of its available resources. For this reason, the organizational goal of small-scale businesses is less complex and easier to achieve as compared to MNCs and TNCs since the expected production output that small-scale businesses can produce is significantly much lower as compared to what MNCs and TNCs are able to produce. In general, managers behind small- and large-scale companies are capable of improving the quality service they render to its customers. However, MNCs and TNCs have sufficient financial resources to purchase highly competitive communication and production technology that can improve the ability of a large-scale manufacturing firm to produce competitive quality products at a much larger volume as compared to small-scale businesses (Julien, 1995). For example: The customer waiting time on drive-thru service in large-scale company like McDonald’s is significantly much shorter as compared with the waiting time of White Castle which is a small-scale company. (Allon & Gurvich, 2008) This is possible since it is so much easier on the part of McDonald’s to finance the cost of training associated with the enhancement of the company’s drive-thru service which is more difficult on the part of White Castle’s financial capability. Because of the significant differences between the production capabilities of small- and large-scale companies, small-scale businesses normally deal with prospective customers within the domestic markets whereas most of the MNCs and TNCs deal not only with the domestic but also the international markets. Qualities and Role of an Effective Manager in Small- and Large-Scale Firms In general, managers are required to have analytical minds necessary in solving management problems aside from having the ability to influence, supervise, and lead his/her subordinates belonging to the different levels of the organizational structure. It is equally important for them to have emotional competence in order to surpass any emotional and interpersonal crisis within the business organization as well as a good communication skill to effectively send his/her message to the workers. (Dessler, 2001: p. 11, 291) Aside from having competitive analytical minds and emotional competence, managers also have the authority to get tasks done with the help of his/her staff members. For this reason, managers often become impersonal rather than emotional when it comes to attaining the company goals. The major role of a manager is to plan, organize, control and lead his subordinates within the business group. Aside from being a good role model within and outside his/her department and other business group, managers also function as negotiator in case the need arises. In most cases, managers act as a leader by motivating and encouraging employees to actively participate in making the organizational goal attainable (Dessler, 2001: pp. 8 – 9). Being persistence in getting things done often makes an effective manager get good result from his people. (Huth, Spring 2001) Despite the similarities in the qualities and role of an effective manager in small- and large-scale firms, Allon and Gurvich (2008) explained that the size of a company greatly affects the service-level differentiation such that the a company with a bigger market size is more capable of rendering a better quality service as compared with a company that serves only a small market. Effective Motivational Approaches for Managers Who Works in Small- and Large-scale Companies are not Totally Different Considering the importance of human resources, HR managers are responsible in ensuring that each manager who works in either small- or large-scale companies receive proper treatment. On top of treating managers fairly, HR managers should develop effective motivational strategies that will increase the efficiency and work performance of the managers. The type of motivational approaches used in motivating managers who works in small- and large-scale companies is the same. However, motivational approaches used in managing generation X and Y managers are totally different. Given that Generation Y employees are inclined with the use of technology, it is easier to convince them to join the organization by using technology-based recruitment process. (The Kelly Intelligence Report, 2005) Similar to Generation X employees, most of the Generation Y managers are very much interested in self-development and improvement (Accounting Office Management & Administrative Report, 2004) aside from being goal-oriented (Southard & Lewis, 2004). Since generation X and Y managers are outcome-focused who continuously seek for a specific and constructive feedback from other people (Allen, 2004), HR managers should provide feedback to managers regarding their work performance in order to minimize employees’ turnover rate (Webster, 2005). Generation Y managers prefer getting instant gratification from their work performance rather than investing their time and effort in a long-term goal. (Southard & Lewis, 2004; Tulgan, 2004) This group of managers also has high expectations with regards to their personal and financial success (Breaux, 2003). Therefore, generation Y employees are highly motivated to put in extra effort when working on something they personally find interesting even if they know just a little information about the job (Lewis, 2003). Generation X managers also prefer to do things the smart and fastest way to get their job done. Therefore, generation X managers look for a constructive feedback with regards to the management style they use to enable them to achieve a better managerial result (HR.com, 2003). Conclusion Small- and large-scale businesses differ in so many ways. Despite the list of differences, the motivational approaches used in motivating managers are generally the same except for the fact that these approaches are based on employees’ generation gap. References: Accounting Office Management & Administrative Report. (2004). Dealing with Your New Generational Mix. Accounting Office Management & Administrative Report , 4(8):5 - 7. Allen, P. (2004, September). Retrieved October 19, 2008, from Benefits Canada: http://www.benefitscanada.com/content/legacy/Content/2004/09-04/welcomingy.pdf Allon, G., & Gurvich, I. (2008, September). Kellogg Insight. Retrieved October 19, 2008, from Firm Size and Service Level: When is it advantageous for a service-oriented firm to differentiate itself along service quality dimensions?: http://insight.kellogg.northwestern.edu/index.php/Kellogg/article/firm_size_and_service_level Breaux, J. (2003). Face of American Workplaces is Changes, Human Resource Personalls Say. Knight Ridder / Tribune Business News. Dessler, G. (2001). Management Leading People into the 21st Century. Upper Saddle River, New Jersey: Prentice Hall Publishers. HR.com. (2003, September 15). Retrieved October 19, 2008, from Managing the Generation Mix - Part II: http://www.hr.com/servlets/sfs?&t=/Default/gateway&i=1116423256281&b=1116423256281&application=story&active=no&ParentID=1119278054390&StoryID=1119652426750&xref=http%3A//www.google.com.ph/search%3Fhl%3Dtl%26q%3DManaging+the+Generation+Mix+-+Part+II%26meta Huth, A. J. (Spring 2001). Born to Lead or Made to Manage - We Need Both. The Strategic Edge. Published by American Business Advisors, Inc. Julien, P.-A. (1995). New technologies and technological information in small businesses. Journal of Business Venturing , 10(6):459 - 475. Lewis, K. (2003). Managing Multiple Generations in the Workplace Can Be a Challenge. Newhouse News Service. Poon, S., & Swatman, P. (1996). A framework for Internet-enabled strategic advantage. System Sciences , 4(3 - 6 Jan.):359 - 367. Rich, A. (2006). Business and Economic Ethics: The Ethics of Economic Systems. 4th Edition. Peeters Publishers. Southard, G., & Lewis, J. (2004). Building a Workplace that Recognizes Generational Diversity. Pblic Management , 86(3), 8(5). The Kelly Intelligence Report. (2005). Helping Employers Secure Advantages in a Shifting Labor Market: Five Ways to Connect with Generation X and Y Workers. . The Kelly Intelligence Report. Tulgan, B. (2004). Trends Point to a Dramatic Generational Shift in the Future Workforce. Employment Relations Today , 30(4):23 - 31. Webster, L. (2005, September). Retrieved October 19, 2008, from MGMA Connexion: http://findarticles.com/p/articles/mi_qa4083/is_200509/ai_n15639712/pg_2 Read More