Organisational and Company Management - Assignment Example

Running Header: Organisational and Company Management Student’s Name: Instructor’s Name: Course Code: Date of Submission: Introduction Following the most recent global financial crisis, a challenge has been posed for many organizations that have a global outlook and that in one way or the have ties with what happens in the global market. This has forced to reexamine their management strategies in order to be able to withstand and even manage some of the shocks. The existing trend is that the management of various organizations has been to focus on short-term objectives rather than balancing them with long-term organizational objectives. This is to mean that the managements have failed to search for and make of use of any available information on the world trends to address the problem earlier enough prior to their occurrence so as to reduce any financial related impacts on their businesses (Hsi-An and Yun-Hwa 2011). When this a financial crisis, the organizational managements have been seen to sought for short-term measures such as staff reductions and cutting of some of the operations in order to reduce the costs of operation and consequently ensure that the business has been sustained during the crisis. But as a matter of fact, this approach has not helped much in assisting companies and organizations to deal with global financial crises (Jack, 2012). Whether an organization is operating as a non-profit or profit-oriented, reviewing and analyzing any data about the economic trends is considered as a vital tool to work on important structure that will ensure success even in the times of crisis. With this regard therefore, any function within an institution must work on the process of managing information as knowledge to informing its operational activities. The management is charged with the responsibility of scrutinizing and making good use of information at all times to make sure that all the decisions made are long-term and effective for the company (Jack, 2012). The primary agenda of this essay is to take into account the issue of global financial crisis and then analyse how management is supposed to work on long-term planning based on the past experiences. Following frequent global financial crises, different companies and organizations have been subjected into very awkward situations. The magnitude of the financial crisis in an organization is directly related on how well the management is prepared and the strategies that it has put in place to tackle the problem (Jack, 2012). Different organizations and companies are responding differently to the menace based on their own objectives, operational contexts and the overall performance. Even though different governments have a role to play in cooling down the situation especially in putting in place the trade tariffs and giving subsidies to some of the organizations, the major responsibility still lies on the shoulders of the management teams. This is because the government initiatives only address the problem from a general perspective and are short-lived (Thompson and McHugh, 2002). On the other, hand organizations have to take quick initiatives such as selling some of the subsidiaries and cutting off some of the labor costs by laying off some of the staff. However, this for many companies as not proved to be a very good management approach as during economic recovery, the already retrenched workers again have to be sourced thus causing another expense to the business according to Thompson and McHugh (2002). In the current global economy every management has got every right to ensure that organizational objectives, goals and interests are protects from all forms of interference including political, social and economic down turn. Truly, working on the management modalities seen as a solution to seeing the business through a very a harsh economic situation. Even though retrenching is seen as a quick measure to managing financial difficulties and that is inevitable, the managers have the chance to collect the situation and safe the company from such steps that may affect their reputation and permanently hurt its global image (Sahdev 2003). Given the difficult economic times, the management is seen to have a huge chunk of tasks to work on and this can only be a relatively manageable affair if reinvention is encouraged. This is because allowing for incorporation of new management ideas, will enable companies to effectively manage its knowledge, diversify and run their ventures, and effectively manage the human resource to ensure that right behaviors, attitudes and workers relations are well managed to enhance productivity for easy turn around after the crises (Sahdev 2003). Knowledge management: Developing and making good use of available information is one the key management issues that many organizations are looking at as they seek ways to overcome economic challenges. Through developing, managing and sharing knowledge, it’s believed that amid difficult economic situation, the company can survive and comfortably reach its optimum growth (Hsi-An and Yun-Hwa 2011). Management of economic situation takes not less than proper and adequate management of knowledge as an asset. Even though this approach is seen by some of the managers as little bit more dramatic, the truth is that, in the current global financial recession, the managers have no option rather than identify those areas that expenditures have to cut and at the same time ensure consistent growth in revenue. Even though knowledge as an asset has not been recognized by many on the value they have to the company, in one way or the other, the success of the management process greatly depends on how well the intellectual capital is being handled (Karthik, 2012). If at all the managers are seeking to improve on the generation of revenues through effective and efficient methods, then knowledge assets are very critical. In organizational management and development, concepts such as Knowledge management (KM), knowledge culture and knowledge services as well as knowledge assets, have begun to emerge and especially towards the end of the 20th century. Enterprise leadership has also received much recognition. This is because of its attention to people management as very important intellectual capital to the company. This is because people can be captured for current or later use. Even though knowledge management has become so popular in the recent past, it’s still evident that organizations are not so keen to managing it, but rather work with it to ensure that the organizational environment is build and sustained for effective sharing and proper use of the company’s internal knowledge and other external information avenues (Yinusa 2004). On the other hand, the introduction of knowledge services into the company is to ensure that those activities that assist the company in leveraging knowledge hold in creating value for the company workers, clients and other stakeholders such as shareholders. In other words, knowledge services are used as a convergence for information management and knowledge management as well as strategic learning. In the middle of the global financial crisis, different companies have engaged on the use of knowledge management to improve on their service delivery and consequently improve on the productivity (Hsi-An and Yun-Hwa 2011). One such good example is the Xerox Company. Xerox Corp. had decided to use the knowledge management tool to capture and manage different data for business use. This after realizing that downsizing and freezing or employment was not doing any good to the business. The process of transitioning into knowledge management by Xerox Corp. was also accelerated by the decline in its revenues in 2001 and therefore was looking out for ways to improve on customer service delivery in order to recover on its lost revenues. The tool that was developed by Xerox is called the ‘Web-based DocuShare’ where employees and engineers could engage and exchange information ways to go about solving different managerial issues and improve the company’s performance (Karthik, 2012). With this regard therefore, knowledge management is seen as a strategy to collect any relevant information and storing it for use by the company to achieve its long-term goals. This is because it allows for systematic organization of content from various sources for decision making (Judith 2001). In the contemporary management society, the existence of information technology has accelerated the use of knowledge management through research and innovation. Information and knowledge and even strategic learning can be used explicitly or tacitly to manage specific situations. Knowledge management in many occasions is related to management of all organizational assets except the tangible assets, the monetary assets and all the traditional accounting concepts that are used in intangible assets. The knowledge assets therefore the management should take into account in order to come up with strategies will ensure business ensure sustainability include: the company documents and databases both leased and purchased, company reports, research information and glossaries as well as taxonomies that describe the environment in which the business is operating in (Karthik 2012). Diversification and management of ventures: Further, the operating environment is continuous changing and the question that is being asked by many of the investors, is how to be proactive and avoid becoming victims of failure during the economic recession. Diversification and management of ventures are two interrelated organizational management concepts. Going as per the past economic down turns, banks and financial institutions have been major victims and thus causing worry on the security involved when investing in such sector. Diversification is about moving from specializing in one product to identifying other business opportunities that are worth investment by the company. This is an important approach by the company to finding out other ways of investing rather than investing and relying on just one product. The organizational management ought to be very much aware of the risks that surround various investments (Wilkinson 2004). Take the example of the financial crisis in the United States where the housing sector had almost collapsed following inability of many citizens to repay their mortgages. Alongside the housing sector, the banking and the insurance sectors also serious severely. The problem was escalated as the stock market was also affected and the problem transmitted to the other countries. In this kind of situation, the work of management is not to make quick investment decisions as there are possibilities of failure. The truth of the matter is that only those companies that wisely invest that can survive such deals. However, investment process must be based on facts and thorough environmental analysis, so as to avoid a situation where management investment opportunities are made based on just mere speculation. To illustrate how diversification and management of ventures has worked for many company, let’s have a look at British Airways (BA). The company has been in operation in the aviation industry for a very century and has been one of the companies that have suffered greatly from the global financial crises that occurred in America and Europe and the most recent being the Euro zone crisis. However, the company has managed to remain relatively stable after diversifying its business from air travel only to cargo transport and provision of other hospitality services such as accommodation and hotelier. This has helped the business recover on its revenues irrespective of the difficult in the economic environment (Colin 2012). Prior the economic down turns, the organizational management has a role to play in identifying other sources of revenues that will help the business boost the revenues when traditional company ventures decline. This is to make sure that those revenues that are likely top fail are compensated for. With this regard therefore management is seen to carry an ideal vision plan that will see it survive stiff competition and staggering economy. For many organizations and companies, diversification is seen as a strategy to creating customer value by introducing new and stable value propositions. The creation of stronger value propositions help create barriers that inhibit entry of new competitors into the industry and thereby taking full advantage of all benefits that exist in a particular industry (Jackall 1988). One way to ensure that this product management strategy is working in the current economic times, consideration is being given to the repackaging and reintroducing the already existing products and services. Even though this strategy is seen as ‘smoke and mirrors’ it is actually critical in giving the company a new ‘face and feel.’ Considering penetrating into new market segments, is another management strategy that has been to offer a relatively stable solution to dealing with financial crisis. This is because no single industry will be dominated for each company and forever and therefore the managers are expected to look up and around and establish the available market opportunities where the risks that exist are manageable. This is especially important in a situation where the business is operating a very volatile economic environment. in general, it is considered wise to take intelligent diversification as this will enable the business realize positive returns even when the economy is not doing very well by Karim (2009). Human resource management (HRM) strategies: In the offing of the current global financial crises, it’s becomingly recognizable that proper human resource management is effective in dealing with the impact of financial crises. Human resource management can be described as the process of managing people at work in an organizational setting. It’s argued that effective management of human resource at workplace can play a major role in assisting the company to realize its goals and objectives. It’s always the responsibility of the management function to ensure that it has at its disposal the right policies and procedures with regard to recruitment, selection, training and development. Human resource management is also associated with managing of people and working relationships. Further, the management function is also charged with responsibility of determining the number of workers required by the company and the skills and competencies they are expected to have in performing their duties (Karthik 2012). In the ever emerging global financial crisis, different human resources management strategies have come into existence with the aim of ensuring that both the employer and employee interests are protected for survival reasons. First and foremost, the management approach towards outsourcing is seen as a cost effective measure to mass retrenchment. This is a cheap scheme that is manageable scheme as opposed to direct recruitment of employees. This is because is because many of the employees will be working on contract terms and therefore will not be subjected to any form of mishandling as they will be aware that there working times will end in due times. In essence, the management view on human resource is expected to look into ways in which the workers will be of benefit to the business not only in managing the functions of the business but also contributing in ways in which they can inform the decision making processes as illustrated by Knights and Willmott (2006). Take the example of the Sony Corp. the company was founded in Japan and its human resource strategy has been to recruiting its workers locally. However, following the global competition and the pressure from global financial crises, has forced the company to reconsider its strategy with regard to employment. Given its global outlook, Sony Corp. has now moved into hiring its employees globally in those countries where it has its subsidiaries. This is because the company has come to realize that the business will be able to gain more intellectual marketing. The locals in the subsidiary companies are considered to have greater understanding of existing marketing and the overall operating environment that will give the business a competitive advantage as opposed to foreigners. Further, this move by Sony Corp. is seen as a strategy to managing diversity at workplace and making use of different skills and competencies possessed by different employees (Sony 2012). Another aspect that has received much recognition by the management function as part of the human resource strategy is the process of communication. Communication is important in ensuring reconciliation among the employees and their workers. Communication as an avenue for human resource management strategy helps in settling on ways that can be used to tackle different issues that surround employment relationships such as working conditions, flexibility, terms of payment and appraisals. This way its assumed that the management will be able to reach flexible working terms even when there is crisis. It is through effective communication procedures that the employees are able to communicate about the past of the company, where it’s currently and where it is headed and ways in which its future performance can be sustained. Communication is further accepted since it gives opportunities to the company stakeholders such as employees, customers and shareholders to raise alarm in case they suspect suspicious activities linked with speculation and authorized investments that might have a long-term effect to the company. At managerial level communication has been associated with whistle blowing. Once the company encourages whistle blowing, it is likely to know when there is a problem through whistle blowing. This is because it’s through whistle blowing that a company should be able to tell if something is going wrong and take the necessary precautions to mitigate its effects. According to Watson (2001), some managers hear about problem and do nothing about it but instead try to cover it until it comes out a very serious crisis. This trend is especially common in situations where high level managers are involved in acts such as corruption or speculation. However, with the era of global financial crisis, the trend is changing as managers are realizing the importance of being ethical in actions and following the laid rules and procedures of the company. In general, communication in the contemporary management is responsible for giving important information that can be used by the strategic planners design the company investment plans on a long-term basis as illustrated by Hsi-An and Yun-Hwa (2011). Conclusion The occurrence of global financial crisis has a caused an alarm to many organization. This is because some of them have failed to survive while those who have managed to survive are still struggling to recover to normalcy. Following the numerous lessons learnt from the past, management in various organizations is working across the clock to ensure that they do not fall victim of the subsequent global financial crisis. The management is particularly concerned with establishing long-term plans rather than taking advantage of short-term investment plans that are based on speculation and that cannot sustain the business for long. In addressing long-term management issues in readiness of any eventuality, the management is particularly interested on working the process of managing information and knowledge as a critical for ensuring sustainability alongside product and service diversification and human resource management strategies. In general, global financial crisis has forced various organizations to reconsider their management strategies for long-term benefits. 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