Introduction of Market-Based Management

Market-Based Management is found on the principles that cause societies to become wealthy instead of mired in poverty. It sees the business as a small society with exceptional features requiring variation of the education drawn from society at large. Through this variation an organisation could build MBM structure and ever-evolving mental models.

Market-Based Management is a holistic approach to organization that incorporates theory and practice and organizes businesses to deal effectively with the challenges of change and growth. It also draws on the training learned from the failures and successes of individuals to attain prosperity, peace and organisational progress. Thus, it involves the study of the history of economies, politics, societies, cultures, governments, businesses, conflicts, science, non-profits and technology.

Market-Based Management is the exceptional management tactic developed and executed by Koch Industries, Inc. It is a company philosophy that is embedded in the science of human action and functional through five dimensions: Vision, Knowledge Processes, Virtues and Talents, Decision Rights and Incentives. Koch Industries’ MBM Guiding Principles articulate the rules of just conduct and describe the main values which direct the day by day business activities.

Market-Based Management is an approach of philosophy which centers on using the tacit knowledge of workers to the benefit of the business. It is stand on creating a situation where workers can feel secure to speak their opinions and question decision making, because the values and the culture permit it. Market-Based Management was based on the fact that capital, ideas and talent are permissible to flow freely and is situated where it is most likely to produce wealth and innovation.… Read the rest

Kotter’s 8-Step Change Model

Change is the word that best described of the modern societies and culture. Change occurred in almost every aspects of life. Change presses us out from our comfort zone. People changed in their life to avoid stagnation and to improve their quality of life and become a better person. This is also true in business where the rapid change in technologies, the way of doing things, advances in information technologies, internal and external pressures, e-business and globalization creates a competitive environment in most organization in order to survive and to be relevant. How business react, operate and adapt to any changes determine the survivability of the company. In organization, change is necessary but often proves to be challenging.

To guide a change (managing a change process) may be the greatest test for the leader of the organization especially when there is resistance. Therefore to lead a change is essential but difficult. The successfulness on implementing change in an organization requires a series of phase, a correct tools and proper planning.  It involves the use of basic tools and structures to control and manage any organisational change efforts. This means that a change manager in every organisation is duty-bound to initiate and lead change in an organization. It really clarifies that, management implies leadership and leadership is a subset of management. The change management focuses on people, their resistance, their coping mechanisms and ultimately how they accept change in the workplace.

There are many management thinkers at different times who have proposed many different theories and model regarding the nature of change management and how to manage the changes effectively for better of the organisations. … Read the rest

Leadership Scorecard

Role of Leadership in Organizations

Leadership has been described as the process of social influence in which one person can enlist the aid and support of others in the accomplishment of a common task. A definition more inclusive of followers comes from Alan Keith of Genentech who said “Leadership is ultimately about creating a way for people to contribute to making something extraordinary happen.”

In an organization where there is faith in the abilities of formal leaders, employees  will look towards the leaders for a number of things. During drastic change times, employees will expect effective and sensible planning, confident and effective decision-making, and regular, complete communication that is timely. Also during  these times of change, employees will perceive leadership as supportive, concerned  and committed to their welfare, while at the same time recognizing that tough decisions need to be made. The best way to summarize is that there is a climate of trust between leader and the rest of the team. The existence of this trust brings hope for better times in the future, and that makes coping with drastic change much easier.

In organizations characterized by poor leadership, employees expect nothing positive. In a climate of distrust, employees learn that leaders will act in indecipherable ways and in ways that do not seem to be in anyone’s best interests. Poor leadership means an absence of hope, which, if allowed to go on for too long, results in an organization becoming completely nonfunctioning. The organization must deal with the practical impact of unpleasant change, but more importantly, must labor under the weight of employees who have given up, have no faith in the system or in the ability of leaders to turn the organization around.… Read the rest

Confidence and Success

Confidence is a funny thing – sometimes it’s difficult to imagine why someone doesn’t feel confident about their ability to handle a situation when we know they could easily do it.

A key issue to understand is that inside all of us there’s a voice which determines how we react to many of life’s situations.  It’s a voice which tells us which things we’re good at and which things we’re likely to fail at.

It’s a voice we generate ourselves based on many years of experience of life. Very often it can be helpful but it can also be a great handicap.

Never underestimate the power of positive thinking.  Every day we hear about human achievements which initially, people probably scoffed at and said ‘You’ll never do it!’  However when someone really believes in their ability to deliver, they often make it.

Most people go through their lives at a level of personal achievement far below what they could really do.  This is mostly because no one has ever taken the time to nurture or encourage them.

The greater the ability someone has to attain their full potential the better the chance they will perform at their highest level and ultimately succeed.

What does success mean?

Different people measure success differently, some people’s views of success are:

  • For many it will be money, power, or material possessions
  • Or perhaps promotion and the enhanced status that comes with it
  • Others will judge their success in life by their ability to influence their surroundings in a much broader sense, for example, improving the environment
  • Others will especially value relationships with their immediate circle of family, friends or colleagues
  • Many people find satisfaction in helping, either materially or spiritually, people less able than themselves, or those who are disadvantaged in some way.
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The Concept of Outsourcing

In recent decades, outsourcing has emerged as a major trend in human resources all over the world. It has become the practice in where certain job functions are sent outside of a company instead of performing them in house. Day by day, more and more companies are focusing on outsourcing as an easy way to grow as well as reducing overhead and payroll costs.

In the simplest terms outsourcing can be described as farming out of different services to third parties. For example in case of  information technology, outsourcing includes any task such as outsourcing all kinds of management of IT to HP or IBM, or even outsourcing a very easy and small task, such as data storage, data editing, disaster recovery or, and any task in between. No precise definition of outsourcing can be found. The term is often used in an inconsistent way.

Outsourcing is often involved contracting out of business activities to an external provider. Outsourcing is any job, task, process or operation, which could be done by the internal employees of an organisation, but instead of doing so; such companies contract a third party to perform the task. In addition, the tasks which are done by the third party may be done off-site or on-site. In recent years one of the major changes has occurred from the growth of individuals outsourcing as a way to develop a feasible service providing business that can be operated virtually from anywhere in the world using internet and online technologies. Some common areas of this business are marketing services, website creating, analysis and etc.… Read the rest

The Advantages and Disadvantages of Outsourcing

Although the concept of outsourcing has been around for decades, it gained momentum during the 90’s when managers started realizing that in order to stay competitive in the market they needed to transfer non-core functions to external specialists. During the initial years, the cost saving aspect was the most important reason companies chose to outsource, but these days a wide range of benefits act as the driving factor for outsourcing. Therefore, the decision to outsource is not a sole purchasing or financial decision, but often it is based on major strategic issues implying enormous organisational changes.

Advantages of Outsourcing

With the benefits of outsourcing a company will be able to see big increase in its profits, productivity and level of quality, business value, business performance and much more. Some of the advantages of outsourcing are listed below;

  1. Reduction and Control of Cost: Outsourcing helps companies reduce their cost on resource management labour, space, etc. According to Accenture, outsourcing leads to a cost saving of 25% to 30% while outsource partners international estimate the cost savings to reach 50%. Getting an access to high-quality services at cost-effective price is the biggest benefit that you can get while outsourcing. In a company, full time employee requires a number of expenses that are not necessary for outsourced employees, i.e. Full time employees are been paid, even if there is nothing for them to do. In this situation, outsourcing helps the company to pay for the time that is spent completing the job and helps in completing the given project or given work at the right time.
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