In our quest to succeed in the emerging global market, should we simply imitate standard management styles and force a cultural change in our people’s mindset, or should we adapt a set of management principles based on our own regional cultural values?

Most senior managers in industry today have had their management training based on finance oriented management styles. We tend to judge corporate and national leaders in comparison with those of large multinationals.

Managing within a mix of traditional styles and modern management principles have been a never-ending struggle. The problem lies in the conflict between management styles, expectations and cultural values.

Therefore the solution would be to adapt a balanced set of rules that include efficient management principles and the strengths of a nations own cultural values. These include psychological and sociological factors such as the collective psyche, value systems, and cultural, religious and ethical norms.

“Know your enemy, know yourself, and your victory will not be threatened. Know your terrain, know the weather, and your victory will be complete ” Sun Tzu, Chinese General 400-320 B.C.

Managing an organization within a global market context is certainly a battle. Mere survival may not be sustainable in the long run. Without the spoils of victory we may remain engaged in hard labour for decades to come. Industry leaders could learn from Sun Tzu’s Art of War, the many strategies and tactics advocated in a battlefield.

Choosing the battle ground ‘L’s – Level, Leverage, Law

Although a Level playing field is the ideal, in real life the battleground could be hostile, or it may simply favour one side. Choosing the battleground and being able to easily identify our friend and foe are important issues for effective management.

The leverage we have is in our people and expertise. An army needs to be trained for prevailing conditions and be familiar with battleground conditions. Are they armed with knowledge, expertise and tools to outsmart competition? What expertise do they have and need? Are there likely to be new competitors entering the market with new skills?

Law of the land or business ethics should be considered and valued. Are we fair to our customers? Do we offer good value? Is our advertising truthful? Are we fair to our industry and competitors? Do we treat our employees fairly?

Look at some ground realities when competing in the global market place.

The western developed nations have the technical and production expertise in high technology and financial services strength. So globalization means opening markets for free flow of information, goods and currency.

On the other hand, developing countries have the strength in numbers in a labour force. Could we expect the same globalization process opening up labor markets to allow for a free flow of labour? However, if it did, would it work to your advantage or disadvantage?

Once we have analyzed the ground situation prepare for battle and ensure that we have room to make tactical changes and have the strength to sustain the long haul. The idea is to succeed, and not merely to join the battle and survive. There is always a price to pay when going in for battle.

Developing a Value matrix

To use cultural values to our own advantage, we need to generate appropriate management tools to enable managers to put them into practice.

“Hence it is said that enlightened rulers deliberate plans while capable generals execute them” Sun Tzu.

The following table shows an example of links between the various stake holders and their values.

 

Chain/Link	Customers	Investors	Employees	Suppliers
Values
Ethical	Information	Environment	Leadership	Trust
Family	Leisure/security	Security	Reward/security	Friendship
Discipline	Consistency	Financial	Time/effort	Delivery/quality
Loyalty	People/service	Accountable	Reward/security	Security/partner
Cultural	Taste/tradition	National	Religious/ethnic	Craftsmanship

 

Getting ready for battle.

Consider at what “Price” you’d go into battle. You may need to implement IS (information systems) to introduce greater efficiency. However, in order to get the benefit of IS you need to be prepared to change existing bureaucratic management structures and ideas. Managers whose power relied on how information was used to manage people will find their positions threatened. The new manager has to change from being a bureaucrat to “decision maker” and allow subordinates to make decisions.

The missing ‘P’s

The old four “P’s, product, price, place and promotion will adequately serve the marketing aspects for trading in mass produced items. But when it comes the strategically placing your tailor made goods and service, the two most important ‘P’ s are missing. These are People and Partners. The expectations of people, or the employees and customers as well as business partners make a significant difference to the value equation.

Managing the three “R” s -risks, resources and reward.

An organization’s most valuable assets are its people and information. The expertise, the labour force and customers represent these. Consider the risks of losing your most valued asset to your competitor.

Although people are not capital assets, there is loyalty, flexibility, adaptability, creativity and innovation in them. In contrast to mass scale, high speed and consistency in machines, we have uniqueness, market adaptability, expertise and craftsmanship in people. The risk is that we do not invest on training to develop these attributes within our most valuable resources.

Managing people is both an art and a science. We need to train our managers to manage the corporate resources to bring in the best rewards from our assets. This also means arming them with the most effective tools such as with IT.

Our reward systems in many organizations contradict the corporate values often preached. We promote teamwork but reward individualism. We talk about the customer being king, but treat them with indifference. We preach transparency but reward bureaucracy. Train to “work smart”, but we reward long hours and ignore good results. Judge on disabilities and ignore special abilities.

We expect loyalty from our workers, but rely on flexibility to hire and fire. If the leaders punish combatants severely for the slightest misconduct while ignoring large scale plundering of resources by senior commanders, that army will not survive.

“Too frequent rewards indicate the running out of ideas; Too frequent punishment indicate dire distress” Sun Tzu.

The leadership ‘I’s –Leadership is about Inspiration, Influencing and to Instill discipline.

This involves trust, empowerment, responsibility and accountability within a management relationship. “Trust and verify” would be the more prudent mechanism as oppose to security and mistrust. If the leadership lacks vision and ability to communicate effectively, getting others to follow is rather difficult. We need to change our management styles from one of “master slave control” to managing, protecting and leading.

After all, leadership is about having a Vision, a Passion, and the determination to achieve goals.

IT plays a major part in how you manage people and information today. Here again, access to information could become a double-edged sword. While enabling faster communication and decision making, IT also enables information flow to cut across management structures. Therefore implementing IT should go hand in hand with corporate cultural changes.

Re- evaluating the “Cs” Customer, Competitor, Country, and Currency

Information Technology has changed the whole battleground and the balance of power. Our customer has access to a global market, yet expects a localized service. Even if we concentrate on our local customer, with IT, our competitor has equal access to our customer. The global operator has economies of scale, but they do not have the same people to people contact at ground level.

The country of origin is not as important as the brand image. Our customer buys trust, recognition and value. The time that politicians controlled currency values are long gone. Today our currency value only represents the level of confidence. With free flow of currencies, governments can no longer manipulate this.

Valuing and measuring the ‘E’s, Efficiency, Effectiveness and Excellence

First we need to identify what we value and base our KPI (key performance indicators) on those values. We need to ensure that we measure qualities that we value. If we value our employees family life and their support, then we need to identify such contributions to corporate performance. If we value the environment as an organization, then we need to find a mechanism and identify its contribution as indicators and how to measure performance.

If we value our customers, again we need to measure our performance on enhancing such values and reward our customer accordingly.

Managing to Work smart with IT

For any organization to be competitive, it has to be efficient, effective and excellent.

Be Efficient by working smart by using the available time in the most profitable way. Be Effective in identifying what is valued and important and prioritizing accordingly. Be Excellent in offering the service that is fit for its intended purpose.

Can one manage time? Strictly speaking, we could only manage our activities with reference to time. We can manage ourselves by allocating time for what we value most. Therefore prioritizing and planning becomes the key factors for effectiveness.

“Therefore, an army that lacks heavy equipment will lose the battle; an army that does not have food will not survive; an army that does not have supplies cannot continue fighting”

Key Performance Indicators

Each organization needs to workout its own KPI (key performance indicators) to measure against its own value system. If the organization believes in differentiation, then its KPIs should stand against its own measure.

Education has its objectives in the formation of character. Education is for building a foundation for life, not a training to make a living. It is up to industry to choose from educated people and to train them in gaining the appropriate vocational and managerial skills.

Organizations should not expect a readymade supply of skills to suite changing market needs. However, industry expects from an education system a supply of educated people, disciplined to fit into society. Respect for “people” and “time” needs to be engrained in our culture, through our education system.

To succeed in a future global market, Management principles encompassing loyalty, skills and smart work, together with a suitable reward system should be adapted as a formula by each and every organization.

Offering your employees training in marketable skills such as IT, communication and marketing through tailored training programmes will improve the employee loyalty to your organization.

IT for Planning, Training and managing Human resources

Any organization that values its human resources should ensure that they are managed efficiently. Application of IT in Managing Human resources should not limit to recording time and wages but to effectively manage its value. That is to ensure that they are equipped with the right tools and skills and are engaged in the most appropriate type of duties to add value.

A large number of organizations still employ archaic methods of resources management, which are highly unproductive. IT should be used to effectively manage information, linking human resources to the corporate value chain.

“Therefore, he (the General) is able to select men who are able to exploit situations” Sun Tzu.

Tailored training for performance

Can an organization differentiate its services by copying its competitor? Advertising can attract customers to your product or service. However, it is how and what your people deliver that make the difference. Therefore, if your people are trained to practice the industry standard level of quality, you could only offer a standard service.

In order to differentiate your service from your competitors, you need clearly identify what it is, that your customers value.

In most organizations, the customers’ first point of contact is either the receptionist or the telephone operator. This is where your customer gets his or her first impression of the service you offer. Your marketing people, vehicle drivers and servicemen’s attitudes also represent your company’s image.

Therefore it is the competence of your people and the service offered that forms the image that your company portrays that will finally represent the level.

Training your people using tailored programmes for technical and managerial skills, leadership, team building and presentation should serve as an efficient and effective way of investing on building a corporate image of excellence.

Unite to add value

Can an organization encourage employee unions to work for its corporate advantage? Yes, by understanding the collective aspirations of its employees, organizations can make unions be the guardians of the employees’ welfare by working together to form an employer-employee partnership. A teamwork environment where, both the union organization and the management, work with the “ideal” of employee welfare contributing to corporate growth and visa-versa.

This requires the corporate leadership to shed the old colonial thinking of confrontational work relationship of the master-slave structure to a more open, information-sharing environment. A change in the mindset of both the management and employee union to work in partnership is needed.

The question the management should raise is “How could we make our employee union add corporate value in order to gain a competitive advantage?”

Adapting IT – to re-invent your business.

Managing in a competitive global environment is a battle. No wining General would send his army without proper training and information on ground conditions. They need quality weapons. Effective management of information using technology against simple investment in IT would mean the difference between victory and defeat. Differentiation through innovation could be a better option than copying to enter a price war.

What are the most valuable assets in your organization? These could be your customers, expertise, employees, business partners and suppliers. In fact it is the whole value chain.

Managing your value chain needs skills and systems.

How do we develop a VCM (value chain management) system incorporating empowerment, flexibility, fast decision-making and customer friendly service, while maintaining efficient information management? VCM requires both people and systems to work together. Each and every value unit must be linked to manage value.

Developing skills for VCM.

There is a marked difference in the attitude for skills development between industrial nations and developing nations. Organization in developing countries look for readymade skills and expertise. Needs assessment, planning and allocation of funds for skills development are ad-hoc arrangements. However, leading organizations in industrial nations recruit talent in order to develop skills.

Management should ensure that training becomes an important part of continuous development of skills for corporate growth. Sharing of expertise along the value chain offer many competitive opportunities to each value unit.

IT as a facilitator

IT is only a facilitator for efficient management. The real opportunity that IT offers is to make your business customer focused. Currently organizations are focusing on using IT to migrate from ERP (enterprise resource planning) to CRM (customer relations management). However, in order to adopt a set of “Globalized -local management principles, we need to develop and migrate towards a VCM (value chain management) system.

What used to be a major task involving a high risk, high cost, customized solution, is now closer to an off the shelf software solution. However, this migration needs a process of re-inventing your current business. However, VCM is a bolder step of planning your whole operation on a clean sheet. Ultimately, it is a process of re-inventing your business to transform it into a Customer friendly service.

Small businesses, especially in developing countries do not have the long-term financial backing to invest in sophisticated equipment. We also tend not to invest in research and development with a longer-range plan in mind. Therefore we should identify strengths in terms of service, knowledge, flexibility and people skills.

Information management as a key performance indicator

The key factor linking all aspects of an organization’s value chain is “Information”.

Information technology, which is by definition, the technology for the collection, processing and transmission of information has a pivotal role to play in any value chain.

An organization needs to set measurable standards for information management. This means that IT investment should bring tangible benefits to an organization.

Just twenty years ago, the corporate IT capability that would have cost one million dollars is now available on your desk for less than ten thousand dollars. The question you need to raise is “Is the added value you give to your customer with your IT investment equally significant?”

The IT skills that organizations need to “re-invent” its business are not just its staff’s ability to operate a computer or feed in data. It is more the skills needed by the organization’s management and the IT supplier to design and deliver a system that could flexibly handle the value chain and corporate business needs.

Simply copying your competitors’ IT capability only results in raising the stakes, without significant added value.

IT as a differentiator.

What aspects of your product or service differentiate you from your competitor? With the development of the Internet, resulting in fast, low cost easy access to the global market place, corporate size per se does not matter.

In fact, the only aspect that would differentiate you from your competitor is the value you offer your customer. The value includes the quality of service accumulated along the chain.

IT could be used to obtain a fast, efficient quality service along the value chain, up to the customer’s doorstep. Mere use of IT as a high tech replacement office automation will not be sufficient to differentiate your service from your competitors.

People buy people first.

You cannot use IT to replace your people skills. It would be your people that represent the perceived quality of you corporate service. IT is only a tool and a facilitator for your people to offer quality service. IT is an efficient tool that can assist in better management of information, to facilitate people to offer, a differentiated service.

Past IT investment holding back progress.

In many larger organizations, its past IT investment has become the main obstacle to progress. Considering the large sums of money invested say four years ago, companies are reluctant to discard such equipment and software in order to start re-inventing its business. Some of these investments still drain valuable resources, in people and money, simply to maintain outdated records.

Does your existing IT investment add value to the service you provide to your value chain? If not, discard it and start re-inventing your business.

The global business environment is changing so fast that you simply cannot plan for a static business environment. Therefore, your IT investment should be planned and justified in giving immediate benefits to facilitate the long-term corporate growth.

Another practice engrained in our culture that people practice each New Year is “discard the old and embrace the new”

Re-invent your business with new market and IT opportunities

By holding on to your old business plans and related IT systems from the past, you may be losing out on many new market opportunities. Discard them today, and start all over again to suit tomorrow’s market. Invest in IT that gives immediate tangible results to add value to your service.

If this sounds like re-inventing the business wheel, never mind. Go ahead and just do-it, because the market roads have changed.

“Therefore, do not repeat the tactics they won you a victory, but vary them accordingly to circumstances” Sun Tzu.