Management Authority in Organizations - Essay Example

Running Head: Management ity in Organizations Management ity in Organizations Management ity in Organizations Controlling and managing an ever-increasing organization needs reviewing all the companies’ assets and intangible resources. This is because effectiveness of managers and other authorities can only be legitimized when effective use of these resources is made sure. In any organization, few departments are very crucial for the success and profitability of the company. These may include, finance, production unit, Management Information System, human resource and most importantly customer care unit. People in these departments mostly manage and perform daily task to keep the company moving. Thus, they are the assets, which the company must recognize as its significant components, which are rather better determinants of the company’s performance than the actual money it generates (Cameron, pp. 88-92, 2004). Most authors and intellectuals, today, focus on the need of knowledge workers in the modern industry to keep the ship sailing. They are of the opinion than in this uncertain world, where downsizing and losses in one company, may also affect the situation in another company, located way far from the host (TSG, p.1, 2009). On the other hand, increase in demand of a product or a service in one country, may also lead to increase in demand of the same product in some other culturally distinct country. Economic insecurity may often liquidate tangible resources with no prior notice and the global dilemma of interrelated companies, put greater expectations on the managers to control and organize the information from around the world on their fingertips. In these difficult times, human resource, as the intangible resource of the company, is the most effective tool to cope up with changing situations (Andriessen, p.1 2004). Today’s era is information era and all the stake of the companies requires handling and managing information critically. This information may include knowledge about the product or service cost, employees’ needs and concerns, competitors in the market, company’s capital at hand etc. Managing company information carefully means that internal members of the organization take good care of the power entrusted upon them and channelized the information attained properly down the hierarchy. According to management research, much of the company’s progress depends on the top managements efforts to align the company’s resources. With regard to intangible resources, strategic competitiveness is much dependent on the way lower staff, age, workload, education standard, job performance, and empowerment is determined. The greater the top management are able to synchronize the mutual performance of the company’s lower staff the greater will be the chances of the company overall success (Shrader, p. 1, 2007). Maintain transparent structure of communication is another way to legitimize the management’s authority. This structure for knowledge management is the key to competitive advantage and long-term sustainability in the industry (Andriessen, p.1 2004). Open communication and immediate feedback from the customers is also the key factor affecting the performance of company. Transparent internal communication gains trust of the knowledge workers and determines improvement in the activities, which were previously done either under threat or unwillingly (Chijo, pp. 88-90, 2007). Organization’s intangible can be described as the company non-monetary wealth generating mechanisms. Intangible resources can come broadly in categorization of intellectual capital, human resources, and accounting. Intellectual capital can be understood in terms of how well company’s vision and knowledge of the workers can be used to effectively design and market brands, reporting procedures and profits. The learned experience to deal with specific customers, enhanced understanding of the market changing trends, and upgraded professional skills are the companies’ intellectual capital (Amar, pp. 89-90, 2002). Accounting structures and international standards can be one another resource for a company to compare and observe the increase and decrease in the overall supply of goods and services. Lastly, the company’s labor capital constitutes the company’s human resource capital (Andriessen, p.1 2004). Strategic advantage of the company can be achieved when its workers are inline with the overall vision of the company and can hold the company’s performance stable in this economically uncertain world (Andriessen, p.1 2004). This can be achieved, if workers who are skilled and talented are hired. In addition to that, observing the overall industry structure, today, will lead to the conclusion that most of the firms are focusing on service oriented jobs and customer care. This shift from product marketing to service orientation has also shifted the concern for managers to have and sustain knowledge workers. This is because knowledge and information competence of the company and homogeneity amongst the employees’ morale, add value to the organization and build on inner strength of the company (Andriessen, p.1 2004). In addition to managing current capacities of human capital in the organization, hiring of new workers who are educated and skilled may also lead to certain advantages like, assistance in implementing the modern technology, understanding customer’s changing needs and adding value to the over company’s image (Amar, pp. 25-27, 2002). It has also been studied that those firms, which has invested monetary capital equal in magnitude to that of the others, will get maximum benefit, if their workers are better able to use that resources. This will result in greater output per unit invested (Shrader, p.1, 2007). In this globalized world, monetary assets and capital is no doubt essential, but true nature of the company’s success is determined by the extent to which managers are able to formulate and implement globally correct strategies. This means that, managers and workers should keep in mind the modern scenario of inter-connectivity between various sectors of the business. No single firm today can claim sovereignty, but all the firms are under due pressure from the external forces. In such cases, wealth in terms of human resource efficiency and intellectual capital is needed to survive (Chijo, p. 83-85, 2007). Experience allows managers to make decisions that are more informed and they should act well in ahead of the difficult situations. It also allows managers to monitor company’s progress and productivity of employees continuously (Shrader, p.1, 2007). Monetary worth of the company, stalk at hand, and other tangible resources are the major determinants of the company’s strategy, but they sole are not the key success factors. Company itself is a business entity. It does not exist on its own. If argued rationally, company is not physical asset owned, but the functions performed by a group of people, because of which goods and services are sold and profits earned. The money it generates and the physical product out in the market are only there to make the company operations run smoothly. However, what needed here are the people and great minds that are working day and night to make the right product and service to be sold in the market (Johnson, pp. 235-237, 2006). The more the people and stakeholders gave value to the assigned product or service the greater is the chances of company’s survival in the future and the greater command and efficacy of the management (Andriessen, p.1 2004). When managers are not able to change with the changing times, and are not flexible enough to deal with the demands of the market, their company, no matter how much cash they have in their bank accounts, are not likely to survive in the end. About intangible resources, no doubt, the success is more deliberate and continuous, but with regard to evaluation criteria, intangible resources are difficult to measure. Defining a more precise criterion to identify and examine the resources is very troublesome, because there is no single means or standard benchmark to compare a company’s performance; instead it is all situation-based and depend on personal evaluations (Andriessen, p.1 2004). Management of Intangible resources means that context needs to be taken care of. Which means that every company is unique and that every decision made and utilization every resource at hand, needs specific concentration (Thomas, pp. 75-78, 2003). In organizations today, managers are not fighting over larger profitability, but larger market share, in terms of market reach. They are not opting for products sold at higher prize but maximizing customer satisfaction. This is because, there have been an increase in the number of companies and firms producing complementary goods and companies in competition need to get hold on the customers top of the mind share. Moreover, most of the firms and service providers are constantly under threat of their brand names being used by other unauthorized production houses that with their techno-oriented production mechanisms create low quality goods and services in lesser costs, thereby putting the actual creators at loss. In this case, the greatest asset for the company lies in the intellectual Property Rights. The Intellectual Property Right is that resource for a company that protects the originator being suffered from clever competitors (Barry, pp. 93-95, 2000). In addition to that, Royalties a company or a service agent would get from the people and/or customers is another facet opening the horizons for the company to build on intangible assets on their company’s balance sheet. For instance, the major brands around the globe have sustained the vicissitudes of the economic mess and have created a certain brand image in the minds of the customers. Customers as the ultimate users of the product or service may or may not be aware of the company’s financial status. What is in front of them is the product they use and the service they enjoy. The value the company builds on over years of quality production determine the worth market would be ready to pay to the brand itself even if the company it owns decides to lay it off (TSG, p.1, 2009). In most of the organizations today, management also needs to keep in mind the multi-culture orientation in the staff members. Culturally diverse workforce and/or customer orientation also put on great challenge on the management to keep up with their individual needs. It is in the hands of top management to make sure that company’s staff member culture and context is well understood. In this respect, most of the companies have created their own code of conduct and internal communication policies to keep track on employee morals and their conduct with others (Hales, pp. 195-2001). In conclusion, information era has lead many companies to be virtual and more vibrant in terms of customer satisfaction and this requires management of intangible resources and establishment of well-oriented communication system. References Amar, Amar, D. (2002). Managing knowledge workers: unleashing innovation and productivity. Greenwood Publishing Group. Andriessen, Daniel. (2004). Making Sense of Intellectual Capital. Elsevier Butterworth-Heinemann. Retrieved on December 28, 2009: www.kermalou.com/books/MakingSenseofIntellectualCapital_PDA.pdf Barry, Jim. (2000). Organization and management: a critical text. Cengage Learning. Cameron, Esther, Green, Mike. (2004). Making sense of change management. Kogan Page Publishers. Chijo, Kazuo, Nonaka, Ikujiro. (2007). Knowledge creation and management: new challenge for managers. Oxford university press. Hales, Colin. (2001). Managing through organization: the management process, forms of organization, and the work of managers. Cengage Learning. Johnson, G. (2006). Exploring Corporate Strategy. Pearson Education India. Shrader, Rod, Siegel, Donald S. (2007). Assessing the relationship between human capital and firm performance: evidence from technology-based new ventures. Entrepreneurship: Theory and Practice. Retrieved on December 28, 2009: http://www.entrepreneur.com/tradejournals/article/170729964.html Thomas, Alan Berkeley. (2003). Controversies in management: issues, debates, answers. Routledge. TSG. (2009). Managing Through Tough Times. Retrieved on December 28, 2009: http://www.sergaygroup.com/Managing-Through-Tough-Times.html Read More