Kaplan and Garrick (1981, p. 12) provide a simple equation for risk, which is “risk = uncertainty + damage”. They believe that it is irrelevant as to what context risk exists in, and that the same equation can always be used to identify and manage risk. However, risk can still be categorized differently depending on what facet of the organization it is affecting. Before a risk management strategy can be decided upon, the risk event must first be identified. An organization should conduct three steps before deciding on the best risk management strategy to use. As risk management can use a substantial amount of resources, clarification and direction should be decided upon before conducting risk management. The three factors are; Identification of the risk: The organization should first review all of the possible risk sources. Furthermore, they could use a risk assessment tool to identify the risk event that may Continue reading
Modern Management Approaches
Employee Participation and Organization Performance
In the first instance is necessary to define both employee participation as well as what is meant by performance. Employee participation may be defined as the process by which employees are involved in the decision making process of a business rather than merely being expect to following instructions and as such this forms what is referred to in HR as empowerment. Performance on the other hand can be considered from two perspectives, firstly there is the performance of the individual in question and how their personal performance is affected by the concept of employee participation. Secondly there is the performance of the organization as a whole to consider and how this will change with varying degrees of employee participation. Approaches to Employee Participation Traditional views of the organization and approaches to management have seen a clear distinction between the tasks of managers and those of the grass roots level employee. Continue reading
Visionary Leadership Style – Meaning, Benefits and Challenges
Visionary Leadership is defined as an operation to influence others in order to create a better future and solve problems in an innovative way. Visionary leaders are those which have the ability to see the capabilities in others have the tendency to lead them. This type of leadership style creates a positive momentum and endurance in an organization. However, the visionary leadership style is most effective when an organization needs a new and clear direction to follow. Employees or people who performed under visionary leaders always enjoy working with them and truly want themselves to reach their full potential and find meaning in their work. Visionary leaders are somewhere different from other leaders as they always inspire, encourage, empower and equip their team members for a better outcome. Therefore, if businesses is looking for moving to a next high level and takes on new initiatives or re-evaluate their vision, then Continue reading
Effectuation – New Paradigm of Entrepreneurship
The business world is permeated through and through this kind of rationality, based on what we see is happening today in the world, what are the trends? what will be the consequences? are forecasted the solutions in a business environment. However, according to Saras Sarasvathy, it is not how entrepreneurs think. The thought process is not “causal” but “effectual”. When a project is approached, the entrepreneur has three means skills: his own innate abilities, skills acquired through education and personal contacts. The entrepreneur is guided by a simple maxim: “To what extent can we control the future, we do not need to predict it.” Here lies all the difference. According to Sarasvathy, the successful entrepreneur does not try to predict what will be the most profitable markets, very opposite idea to Henry Mintzberg. In 1997 Saras Sarasvathy, professor of business and ethics at the University of Virginia but then a Continue reading
Impacts of Internet on Entrepreneur Ventures
In recent years, internet is more and more popular and closely to people in a variable fields. Internet was used as a tool for helping them to connect and seeking information or advising what they need. Almost entrepreneurs also use this tool as a part of creating successfully for their business but sometimes it also creates some problem. Some negative impacts of internet on the entrepreneur venture such as security or lost productivity that make the entrepreneur take a lot of problem. However, almost impacts of internet on entrepreneurial ventures is good such as raise the capacity of accessing information through internet, increase communicate capability among entrepreneurs and others people, help to achieve the target specific venture firm, increase the efficiency of the submission process and specially support marketing strategy. Firstly, the most effective impact of internet is the security of the information. Many businesses conducted online get the trouble Continue reading
What are Dynamic Capabilities?
Concept of Dynamic Capabilities of a Firm A dynamic capability refers to company’s ability to integrate, build and transform internal and external competencies. They can help an organization to achieve innovative forms of competitive advantage through integration, building and transformation of internal and external competencies, as to respond to changes in the environment. This management theory was defined by David Teece, Gary Pisano, and Amy Shuen in their 1997 paper Dynamic Capabilities and  Strategic Management. In the context of achieving organizational change, aligned to the external pressure: namely, these capabilities are perceived as business processes that use resources — specifically the processes of integration, restructuring, acquisition and release resources — to adapt or create market changes. Dynamic capabilities are especially helpful in explaining the sources of competitive advantage in extremely volatile markets. Dynamic capabilities are determined by organizational and managerial processes, positions and paths. The organizational and managerial processes refer Continue reading