The paper 'The Current Global Financial Crisis and Organizations' is a wonderful example of a Management Assignment. It is of great significance for organizational managers to recognize the major challenges that come with the global downturn. The present global financial downturn has led to many organizations examining their approaches in light of the ever-rising competition along with reduced consumer demand. Adjusting to fit within the new environment demands comprehensible strategic focus, speed as well as flexibility in order to prosper, survive, and fit in within the new environment. Every global crisis is in one way or another different but the current one has seemed extraordinary.
On no account has government involvement in developed as well as developing nations of this extent and scope been observed in the past. And in no account again has economies, financial organizations, markets as well as supply chains been internationally incorporated to the level they are in the present, even making it difficult for the most self-sufficient firms to hide (Thomas, 2010). The management challenge is frightening. However, the focus ought to shift from assumptions on how long the downturn will get to the improvement of strategies that will enable organizations to survive as well as gain from the enormous transformations the recession period brings.
The major challenges an organization in a crisis period goes through are often naturally linked to finance and marketing. Even though this is evidently a generalization, one would view marketing as the central issue with respect to revenues and finance as the prevailing issue with reverence to expenses and how to fund them. Karina etal, (2009) highlight that many organizations naturally act in response to the financial crisis by downsizing its capacity through layoffs and salary reductions and choosing to reallocate resources towards the development of later on stage projects so as to increase the market share of perhaps the organization’ s available products.
And with the present global downturn throwing a bleak international outlook, various organizations have reacted variably. Future-oriented organizations believe that during such a crisis it is more significant to maintain, motivate as well as develop talent. They recognize that it is their present employees, for instance, who will make a difference in the organization’ s long-term triumph.
They also believe that the strength of an organization may be advanced during a recession as it moves on leading the drive for potential innovation and revitalize its product pipeline (Thomas, 2010). On the contrary, organizations that are not future-oriented find themselves susceptible especially when the economy returns to normal. Furthermore, they’ ll need to restart recruiting or retaining senior level executives to drive innovation and rebuild product pipelines which put them to a disadvantage. Successful organizations naturally bring into line their processes, structures, cultures, resolutions as well as self-image along with the market and competitive circumstances during normal business and boom times as well.
This enables them to haul out efficiencies and to boost the efficiency of their strategies as well as initiatives. Throughout the final crisis period, it becomes difficult for various organizations to employ equity, huge bonuses, and hefty pay increases to maintain their top executives as well as their employees. Many organizations are thus forced to come up with mechanisms to incentivize as well as to retain their respective staffs.
Bowes, B, J, 2010, Working World – Organizational: Cutting Payroll Doesn't Always Pay Off, Management Journal .
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Eltham, B, 2010, How Does Our Economy Compare? Retrieved on August 25 from http://newmatilda.com/2010/06/01/ben-eltham-interviews-david-wessel
Global Research, 2008, Causes and Solutions to the Global Financial Crisis, United Nations general Assembly, Retrieved on August 25 from http://www.globalresearch.ca/index.php?context=va&aid=10792
Karina etal, 2009,’’Predicting business unit performance using employee surveys: monitoring HRM-related changes’’ Human Resource Management Journal.
Thomas, L, 2010, Managing Talent When Things Get Tough, BioSpectrum Bureau Journal. Retrieved on August 25 from http://www.biospectrumasia.com/content/040810SGP13330.asp
World Bank Group G20 Summit, 2008, Financial Markets and the World Economy. Global Financial Crisis: Responding Today: Securing Tomorrow, Retrieved on August 25 from http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21972885~pagePK:64257043~piPK:437376~theSitePK:4607,00.html