Management Control Systems in Organisation HTC - Case Study Example

Name: Institution: Course Name: Lecturer: Date of Submission Management Control Systems: A Case of HTC Introduction HTC Background HTC, a Taiwanese producer of Smart phones, tablets and presses forward for the development android mobile equipment, was cofounded in 1997 by Cher Wang and Peter Chou. Their major dream on beginning this company was to ensure that their opening phone on the international market to utilize the android mobile equipment policy. HTC has had a flourishing tradition which includes the manufacturing the first Smartphone whose operating system was powered by Microsoft. Their most important breakthrough came with the manufacture of the first touch screen Smartphone, power-driven by a mobile operating system. Currently, HTC has a major problem that has resulted in its lack of direction, assertions that were confirmed by the corporation’s Chief Executive Officer, Peter Chou. Merchant (2009, p 1) asserts that the loss of direction in a corporation usually results in the failure of the entire management, and this is the case situation with HTC. The loss of direction in HTC has resulted in the general drop in the superiority of their products. Bombarded with this problem, HTC conceded a considerable ground to the ever aggressive Apple. HTC’s falling short of a calculated direction resulted in a drop of its smart phone percentage market share. Problems facing HTC Lack of direction Lack of direction is a major problem that any organisation can face because it results in several other unforeseen issues for the reason that such a problem usually overshadows forecasting for the future of the organisation in question. Adding to the loss of direction is the fact that HTC customers have overtime failed to be acquainted with the brand that the corporation is producing because, being a new corporation, HTC has failed to effectively compete with phone companies for instance Apple, LG and Samsung, who have established a rapport with their customers. Being a comparatively new corporation, due to the inadequate strategic planning, HTC has not been able to manufacture smart phone brands that will outdo their competitors and thus give them a leading market share in the smart phone world. According to Kober, Juliana and Paul (2007, p 426), organisational policies, which usually inform the management control system, were lacking in the HTC case as a result, the organisation continues to straggle and that is why it continually registers diminishing profits as shown by the quarterly forecasts. Motivation According to Roberts (2010, p 42), ensuring that the employees needs are met is usually a key to making certain that they are motivated towards achieving organisational goals. Moreover, employees usually feel good when they are associated with an organisation that is performing and thus this usually motivates them to improve their productivity in order to stay at the top. At HTC, the employees seem to be less motivated because of the company’s dwindling fortunes and the general lack of direction which has resulted in a drop in its market share. With the company’s embarrassing branding structure which the customers find hard to recognise with, the employees feel lesser motivated to work with an organisation that lacks creativity, a feature that is evident at Apple and Samsung. When Samsung produced the Galaxy and Apple the ‘i’, to counter this, HTC manufactured One, HTC One. This branding made it hard for the product to compete with the others because it makes it hard for the customers to recognise with it and thus such a move discourages the employees because their effects are not being rewarded. With the effective management control systems in place, the issues of motivation and unsuccessful innovations will be successfully managed (Bisbe and Otley 2004, p 710). Personal Limitations Although HTC is set up in Taiwan, Peter Chou insists that English and Chinese should be the major languages that the organisation uses, forgetting that these two languages are uncommon in that country and thus this could be one of the limitations that could be hindering the internal communication and thus the registering of dwindling quality of its products. Inadequate creativity is another personal limitation that could be hindering the progress of HTC. Creativity is usually essential in ensuring that individuals come up with ideas that result in the innovation of products that meet the customer requirements. Quick reaction to intense competition is an edge that HTC is lacking and thus the continued lagging and this failure can be tied on the general failure of the management at individual level. Instead of dwelling on the languages to be used, the organisation can delve into other mechanisms that will ensure that the organisation undergoes a transformation that will ensure that they get a competitive edge over their other competitors, mainly Samsung and Apple (Asel 2009, P 3). Minimising HTC’s problems Ensuring that the best management control systems are in place will ensure that all the organisational operations are effectively and efficiently managed and as an end result, HTC will find its footing again. Since an effective management control system gathers and employs data successfully in order to effectively review the functioning of all the segment of an organisation, putting it in place at HTC will ensure that limitations that this organisation has been facing have been eliminated (Armesh and Salarzehi 2010, p 193). Putting in place such a system will guarantee HTC that its competitiveness is at par or even higher than that of Samsung and Apple. In this regard, the slackness in countering her competitors’ new products on the market will be effectively and efficiently outdone because HTC will always be able to be ahead of its competitors plans, and as a result any of their products will receive stiff competition from HTC’s. With effective management control systems in place; the loss of direction, lack of motivation and personal limitations; will be defeated because everyone will be focussed on achieving the goals and objectives that HTC has put in place, a fact that will ensure that its profits rise considerably, as compared to that of its competitors. Management control practises for instance budgeting will come in handy because this will ensure that the manufacturing costs are effectively stipulated in order to ensure that the gains after sales are worthwhile. With effective planning and execution, HTC will be able to overcome the problem of lack of direction because with effective planning and efficient implementation of the desired changes, the projection of a positive outcome is always possible. Effective HTC management control systems will augment performance because the strategy advancements and execution put in place will curb the limitations that have been affecting the company’s operations (Tekavcic, Peljhan and Sevic 2006, pp 2-3). By ensuring that the communication channels are open, speedy deliberation on issues and the opening up of avenues that will ensure that individual creativity is recognised, the issues that HTC is facing will be overcome and as a result, the production will increase, a case that will see the company posting positive returns on their quarterly forecasts. A critical study of HTC’s company culture, environment, the organisational arrangement and the execution strategies will aid in the choosing of a management control system that will effectively transform its operations into a gainful venture. With the ever transforming business world in terms of the clientele and the production technologies involved, HTC should ensure that it keeps up with this changing trends so as her products can remain competitive. Comparison of the options In any organisation, ensuring that the communication channels are left open at all times is usually essential in ensuring that the correct information is relayed timely in order to ensure that the expected tasks and duties are accomplished successfully. HTC should ensure that one on one and group communication channels are left open because through these measures, the sharing and exchange of opinions will ensure that personal and group creativity improves tremendously. Through effective communication, there is usually a change of attitudes, an act that often instils workmanship traits in individuals thus enabling organisations, and in this case HTC, to attain it goals and objectives (Turkalj and Fosic 2009, pp 33-35). Through team relations, organisational conflicts are usually easily sorted out thus ensuring that the organisational cultural influence is maintained. For instance, at Apple, a case where all forms of communications are allowed, disputes between workers are sorted out without the intervention of the supervisors, a case scenario that builds trust and thus an increase in productivity. Effective planning and organisation is usually an essential factor in any organisational structure because without planning, then the set up will be on its way to the exit phase. Through effective planning and execution, HTC will be able to lay down the necessary strategies that will take care of Samsung and Apple’s innovations, a scenario that will make them ready to counter any production made. At the release of Galaxy and the ‘i’, had the necessary branding and marketing strategies been in place, HTC One would have achieved the same market success or even more thus rivalling the market share that the two companies enjoyed. Through effective planning, everyone in the organisation is always aware of their part in realising the entire goal and thus each individual brings their individual creativity to the pool and thus the product is usually as a result of the collective effort of the employees. In such a case, success is usually shared collectively thus ensuring that the employees are motivated in accomplishing organisational goals because they realise that both individual and group effort is always recognised. In any organisation, the management control systems usually play a critical role in overseeing the general operation of the organisation because it provides the necessary information that is required to ensure the effective functioning of the diverse departments thus making them independent yet linked to the whole system. At HTC, putting in place a management control system that best suits the production, customer, employee and requirement needs of the organisation without compromising the company’s culture will be sufficient in ensuring that the marketability of this organisation hits high. Management control systems for instance budgeting are usually essential in ensuring that an organisation operates within the set resources in its production endeavours. Addressing HTC’s Problems With regard to the problems that affect HTC, the three options are best suited to operate in cooperation because although they are addressing different issues within the same organisation, they are directed towards the redemption of a singular organisation. For the reason that there was low motivation, a general loss of direction coupled with other personal limitations, employee retention became a problem because the employees wanted something that they could proudly relate too, but since HTC could not provide them with that, leaving the organisation became the only option. To remedy this move, putting in place the best management control systems, improving the communication channels and ensuring an effective planning and execution of organisational goals and objectives will ensure that HTC survives its bad times. Ensuring that communication strategies, planning and execution are part of the management control systems being put in place at HTC will see through a transformation that the corporation has been searching for because these attributes often dig from each other in order to be fully operational. Putting the management control strategies in place will ensure that the employees’ general performance can be analysed and thus rated against the organisation’s expectations to figure out the areas that can be improved upon in order to reap the best out of everybody’s input. Through the analysis of employee performance, this ensures that the general and specific targets that the organisation has set are fully met thus ensuring that where efficiency and effectiveness is required, systems are installed to effect them. Management systems that authorize the employees to dig deep into their creative instincts in order to produce goods that gives an organisation a competitive edge over the opponents are best suited for organisations like HTC that require the development of product brands that the customers fancy. Moreover, HTC’s problems can be addressed by employing a management system that is flexible in order to ensure that in the case of changes in the world market, it is easier to adjust it and thus making it easier for the organisation’s products to settle in the new market. Through inventiveness and competence realising organisational goals becomes easier because everyone in the organisation is usually aware of their expectations and thus understands their individual input so as to realise the expected outcome. For any organisation to realise its goals, it is usually essential to ensure that the employees know the organisation’s expectations and the manner in which the forecasts are to be attained. By employing the management control systems within the organisation, HTC will be able to effectively realize its strategies by employing the relevant procedures and machineries in its production line. Conclusion The integration of management control systems at HTC will ensure that the organisation effectively combats the limitations that have overtime hindered its progress. By ensuring that the products are always measured against the prospects, HTC will be able to effectively and efficiently manage the market expectations because every process in the production will be monitored to ensure that the best results are projected. In HTC’s case, if the functioning of management control systems are fully applied and well managed, then the company will reap its goals. 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