Effective Management Roles - Case Study Example

 Effective Management Roles TABLE OF CONTENTS Page 1 Abstract 3 2 Introduction 4 3 Evaluating Management 4 4 Environmental Changes at DynaLab 8 5 Managerial Functions 9 6 Managerial Roles 10 7 Defining a Good Manager 10 8 Conclusions 11 9 Bibliography 13 1 Abstract Managerial Roles have been defined by Minzberg and they have been discussed at length. These roles were applied to the case study of DynaLabs to determine the extent to which the company fit the definitions. It was discovered that the Managing Director of the company had abolished the layer of senior executives; hence the Mintzberg theory was not applicable here. This was found to be the cause of the various external threats from both rivals and predators was the cause of worry to the company. It was recommended that immediate steps must be taken to restore the senior executives to functions as per determined managerial roles and for the MD to assume his Leadership role to contain the threat to the company. 2 Introduction DynaLab is a manufacturer of cleaning supplies, is quoted on the Stock Exchange, and is a £ 150 million a year company. It has been in business for several decades now and is respected both in the market and the bourse. It has commenced International Marketing and faces competition from a much larger rival, Unilever. Its current Managing Director (MD), Alan Smith, has been elevated to this position at age 60 after forty years of service at various positions. During his tenure the company has risen to new heights, the stock prices have appreciated to four times their previous levels and profits have soared by 50%. This has been largely due to new innovative products and robust marketing practices. Despite being the market leader in UK the MD is worried by the close competition offered by arch rival Unilever. He also worries about a takeover attempt. Some time back the company had made an acquisition which turned out to be a mistake and heavy loss was suffered in its eventual disposal. As they are contemplating another acquisition the same fears are causing concerns. For these reasons the company is reviewing its managerial skills for possible improvements. 3 Evaluating Management Earlier management’s function was to be a guide and mentor, a role reserved for those who had put in their best years and were now required to generally oversee the operations and to formulate strategies to be carried out by subordinates. Now management is required to be hands-on, a term referring to the day to day involvement in the affairs of the company. This not only brings the management and the executive functionaries closer but is used as a continuous evaluation process. The objective is to create a more congenial environment, a close relationship between all the functionaries, promote teamwork and to enable quick decision for solving problems or removing bottlenecks. One of the theories of managerial functions has been developed by Henry Mintzberg (1973) wherein he has divided the role of managers into three groups calling them Interpersonal, Informational and Decisional roles. These are then further classified into ten different but connected roles. The Interpersonal role largely consists of interactions between the individuals commencing from the superior to the subordinate and vice-versa. This is the area where information is sought, provided and exchanged. When information is thus exchanged, it sets up the linkages of all departments for the flow of information to wherever it is required. This is also known as data flow and sometimes the method of this data flow is through the use of software and computers. The third role of Decision making now becomes easier as information is now available with the right person, at the right time and place, based on which decisions can be made with confidence. These three groups are then further subdivided to expand into ten roles that describe the functions they perform in a more focused manner. The Interpersonal roles are that of a Figurehead, Leadership and Liaison activities. As a figurehead, the manager acts in the capacity of the responsible representative of the company on all formal occasions. Here the Top Manager, like the CEO or the MD is in an external environment and his person is representing the company in a social or legal context. If the manger is a Supervisor or a Head of a Department his role will be as a representative of the group or department he is responsible for. He is now interacting with people external to the company, in case of top management, or with superiors, in case of supervisors. His Liaising role is to either get favours or advantages or to arrive at conciliations and compromises that are favorable to the company or the department as the case may be. He may be liaising for information that can be useful now or later. The purpose is getting leverage. Finally as Leader his role in the Interpersonal function is to define various relationships between individuals and groups that he is supervising. It will be the whole company in case of a CEO or MD; and the department in case of a Supervisor. Overall in the Interpersonal role the manager concerned is seeking and providing information based on which he expects an exchange of information that will be beneficial for the organization, departments or individual under him. The three roles a manager plays under the Informational mode are that of a monitor, disseminator or as a spokesperson. All these functions can be described as different phases of the information being processed. The information received in the earlier Interpersonal role is now required to be understood, assessed, passed on to the relevant person who can use, apply or store it for some benefit. Monitoring would cover the activity of evaluation where certain information advises of a current status vis-à-vis the planned status. This is the verification of actual results against an earlier activity and matching it with the perceived result. This monitoring becomes a useful guide for future action or can be used as a corrective measure for the current actions. Similarly as a disseminator or distributor of the information, the manager’s role is to decide who will benefit form this information or who can use it to further the cause of the company. This is an important function and needs to be carefully planned as information in wrong hands can be either detrimental or useless and in both cases is a waste. This function is probably the most important in the whole exercise as information or data is vital for carrying out any function throughout the organization. Sensitive data or information needs to be processed with permissions and at times several layers of securities are prescribed before a piece of information can be seen or accessed. As a disseminator, the manager’s role is to decide who should get what information and to verify that the information or data has indeed been actually passed on or delivered. The time and place of delivery is important and in this age of mobility where almost everybody is on the move, are rarely together at one place, the agents of delivery such as internet, mobiles and handhelds has assumed a great role. Communications fall under this head and the hardware, software and content have each got an important role to play and the manager has to now be able to use these mediums with ease. Lastly, the role of the spokesperson becomes important since it becomes the duty of the manager to speak on behalf of or to represent his constituents to internal or external groups. Stakeholders are an important constituent and between them there should be no ambiguity and this is the prime role of the spokesperson to clarify the situation in the clearest terms and most diplomatically. This brings up the last group of roles that are decisional in nature. The decisional roles make significant use of the information that has been obtained as a result of the interpersonal and informational roles. The manager who is in possession of information is now in a unique position in the company. He has four different roles to perform. As an entrepreneur or a person representing investors like the CEO or Managing director, he is in a position to bring about changes. He is in a position to define policy, strategy, vision, mission and objectives. He is in a position to initiate change process and procedures. This is indeed a huge responsibility and he decides on the future direction of the company. There are always threats and disruptions occurring within and beyond the company, and the managers’ unenviable role is handler of disruptions. His next role is of a resource allocator. The manager is in distinctive position of deciding how the various physical, human and financial resources will be utilized and by or through whom. The managers’ final calling is as a negotiator. In this role he is negotiating and bargaining for position for the benefit of the organization. Such negotiations can be internal as with labour unions or external with suppliers. This is an important role as it ends in effecting the balance sheet. Having explained these various roles, Mintzberg further elucidates that one single person may be required to wear several hats. Thus we see a manager handling several roles in the line of duty. 4 Environmental Changes at DynaLab The external changes faced by DynaLab begin with the high expectations from the financial markets in view of its success during the past 5 years. The market expectations have run high and to match them year after year, in the face of stiff international and local competition, especially from Unilever is a tough call. This means the Analysts need to be carefully informed of the prospects as any sudden fall in profits will see a nose-diving stock price and several other stakeholders, besides the stockholders, will become restive and will effect the company performance even further. It is the MD’s job to be closely in touch with the market and to feed them the right kind of information for the sake of maintaining stability. The next is the threat of a takeover attempt by a rival or any other predator. The company has been doing exceptionally well as indicated by the quadruplicating of shares values. The dominant position in the domestic market is attractive to predators and rivals alike. There are however no plans for thwarting such an attempt. One measure, although feeble, is to expand through horizontal acquisition to make the takeover less attractive. But such an attempt has been disastrous in the past and in the future another attempt may result in the repetition of the same. These are real ground realities that remain as definite threats requiring attention and solutions. 5 Managerial Functions There are four important functions of the DynaLab MD and they are planning, organizing, controlling and leading. He has taken it on himself to handle all of these by himself as he views them as his personal domains. He involved in each of them at the micro level. This keeps him involved with all initialing events that take up too much of his time. His emphasis in being involved in all planning leaves little of his time for other important jobs of leading the organization. Despite that he has not been able to plan a strategy for the external threats discussed above. He is more involved in trivial planning instead of strategic planning. He is also very keen in organizing activities rather than controlling activities. He prefers to meet sales reps rather than monitor their performances. He is spending more time on fringe activities that spread goodwill but do not necessarily meet market related challenges. 6 Managerial Roles Managerial roles as specified by Mintzberg are missing in DynaLab. The interpersonal roles have largely vanished as there is hardly any senior executive who is heading divisions and department. These positions have been abolished and now overseen by the MD himself. There are only mid-level managers who can follow instructions but are unable to perform interpersonal or informational roles in the true sense of the terms. They have no responsibility and there is no monitoring mechanism in place. Targets can be set only as ultimate wishes without any planning procedures to encourage efficiency. The decisions too appear to be vague and not focused on meeting specific situations or challenges. The general perception is that Unilever is a threat, but measures to meet this threat with policies are curiously not spelt out. This shows both lack of information as well as absence of problem related decisions to ward off threat. It appears that the company is surviving purely because of the high number of innovations and the goodwill these generate with the customers. What will happen if these innovations dry up? There are no contingency plans as innovations last only till the next one comes up. Absence of senior executives also brings in the question of succession. No succession can be planned in absence of the next line of managers. What are the plans when the incumbent MD finally retires? There appears to be no one who can take over the reins of the company except an outsider who will require a long gestation period. 7 Defining a Good Manager On the face of information available the present MD is a failure as firstly he has purposely eliminated the senior executives without thinking of the future. A good manager is one who prepares a second line of defense and people who can be groomed to be next generation leaders. He has to build a team of co-workers with hierarchies for improved management. He has to distribute responsibilities and monitor performances. He has to encourage his managers to raise their performance and to provide them with adequate resources to fulfill these ambitions. A good manager is essentially a good organizer. A good organizer is an enabler. He promotes ability and provides them with opportunity to face challenges but supports them in their efforts. 8 Conclusions Unfortunately the present MD has been distrustful of second line managers and does not believe in delegation of authority. This usurping of all power will do great damage to the company by creating a vacuum that cannot be filled overnight. He should have taken a leaf out of his superiors books who promoted him gradually and groomed him to this position of eminence over a long period of time. This is exactly he should have done for his successor. Apparently he has not only removed all mangers but he has further eroded the company’s capability to answer their competitiveness when the present MD retires as he will have no one to step in his shoes seamlessly. If I were in the MD’s position the first action would have been to develop a reliable team of senior executives that would be responsible for critical areas of the company. This would give them the exposure and experience to handle tough management situations as they would have performed the managerial roles described by Mintzberg. Most of them would have multiple roles as management is an encompassing activity and cannot function by isolation of activities. They would be monitored and guided by the MD in pursuance of the strategy planned by him for managing the company efficiently. These executives would also perform the important role of decisions makers and that would shift the burden of routine decision from the MD who could now concentrate on meeting the external threats from rivals and predators. It would also free him to plan for the company’s vertical as well horizontal expansions. He would now have time for the stockholders who backing would help him stave off any takeover attempt. He would in fact have time for other stakeholders as well and by including them in the overall strategy of the company he could well eliminate the threats to a large extent. The true place of an MD is at the helms of affairs, as a leader who is in control through his team of executives. This is what would be recommended for the present MD. Bibliography Mintzberg H: The Nature of Managerial Work. New York, NY: Harper & Row; 1973. Read More