Idea Generators

Idea generators are individuals who have the ability to sift through jungles of market and technological information to find ideas that lead to new products or services. They possess the talent and knowledge to find new cost or time effective procedures, approaches, or problem-solving strategies. They possess skill that is deep expertise in one discipline combined with broad enough knowledge in others to see the linkages between them. Such skills are critical in integrating different functions (R&D, design, marketing, manufacturing, customer service) to synthesize a product or service, in seeing the connection between a technology and its applications, or in turning customer expectations into products.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Managing Inventory

Inventory is an area where financial managers can fine-tune the firm’s cash-flow. Inventory sitting on the shelf represents capital that is tied up without earning interest. Furthermore, the firm incurs expenses for shortage and handling, insurance, and taxes. And there is always a risk that the inventory will become obsolete before it can be converted into finished goods and sold.

The firm’s goal is to maintain enough inventory to fill orders in a timely fashion at the lowest cost. To achieve this goal, the financial manager tries to determine the economic order quantity or quantity of raw materials that, when ordered regularly, results in the lowest ordering and storage costs. The problem is complicated by the fact that minimizing ordering costs tends  to increase storage costs and vice versa. The best way to cut ordering costs is to place one big order for parts and materials once a year, while the best way to cut storage costs is to order small amounts of inventory frequently. The challenge facing the financial manager is to find a compromise that minimizes total costs.

That is why many businesses today are turning to just-in-time inventory control. Businesses—and even divisions within companies—link up through computers with their customers and suppliers, thereby automatically ordering only as much as is necessary for a given period of time.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

People-Oriented Management

Business executives must strive to maintain a people-oriented philosophy of management. The daily press of commercial activity often makes it easier to deal with numbers, organization charts, inter-office memos, and administrative procedures. But industry is not the only segment of society that should pay greater attention to people. The federal and provincial governments have been under attack for treating people as “files” instead of as human beings. Insensitivity to human needs is a critical problem in nearly all organizations; yet, a humanistic approach to management is always good business, regardless of the industry.

The special needs of some people have been neglected. The physically handicapped have had to overcome some managerial barriers in order to achieve occupational dignity. Individuals who have served time in jails need jobs that will keep them from returning to criminal activity.

These situations reflect dissatisfaction on the part of people involved in or affected by business organizations. Such people argue that business has been too concerned about short-run profitability, machinery, evaluation, and control of corporate personnel and not concerned enough about the people involved. One of the aims of social responsibility is the achievement of a new concept of management that will take into account people oriented concerns.

Workers are more productive when they have a sense of participation in the decisions affecting them. Human resource development has thus become a major organizational objective for many businesses. People-oriented management requires a careful balance between productivity and profitability objectives on the one hand and employee desires on the other.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Corporation and its Stakeholders

The people, groups, and organizations that interact with the corporation and have an interest in its performance are its stakeholders. Those most closely and directly involved with a business are its primary stakeholders; those who are indirectly connected are secondary stakeholders.

Stakeholders can exercise their economic, political, and other powers in ways that benefit or challenge the organization. Stakeholders may also act independently or create coalitions to influence the company.

Six key forces are affecting the business-society relationship: strategic refocusing and restructuring of businesses; changing ethical expectations and public values; global economic change; a global trend toward rethinking the role of government; ecological and natural resource concerns; and the transformational role of technology.

To deal effectively with globalization, ecological concerns, and ethical issues, a corporate strategy must take into account the interests, needs, and expectations of all of the company’s stakeholders. Companies should have a strategy that combines business goals and broad social interests.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Departmentalization

Departmentalization is the subdivision of work activities into units within the organization. This subdivision allows individual workers to specialize in certain jobs and to become efficient in them. A marketing department may be headed by a marketing vice-president and may include sales, advertising, and market research. A personnel department may include recruitment, training, employee benefits, and industrial relations.

Five major forms of departmentalization exist: product, geography, customer, function and process. A number of different bases for departmentalization may be used within the same company. The decisions on which bases to use are made by balancing the advantages and disadvantages of each. The experience and judgment of top management come into play in such decisions.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Disadvantages of Sole Proprietorship

What may be seen as an advantage by one person may turn out to be a disadvantage to another. The goals and talents of the individual owner are the deciding factors. For profitable businesses managed by capable owners, many of the following factors do not cause problems. On the other hand, proprietors starting out with little management experience and little money are likely to encounter many of the disadvantages.

1. Unlimited Liability: The sole proprietor has unlimited liability in meeting the debts of the business. In other words, if the business cannot pay its creditors, the owner may be forced to use personal, non-business holdings such as a car or a home to pay off the debts. The more wealth an individual has, the greater is the advantage of unlimited liability.
2. Limited Sources of Funds: Among the relatively few sources of money available to the sole proprietorship are a bank, friends, family, or his or her own funds. The owner’s personal financial condition, then, determines his or her credit standing. Often the only way a sole proprietor can borrow for business purposes is to pledge a car, a house, or other real estate, or other personal assets to guarantee the loan. And if the business fails, the owner may lose the personal assets as well as the business. Publically owned corporations, in contrast, can not only obtain funds from commercial banks but can sell stocks and bonds to the public to raise money. If a public company goes out of business, the owners do not lose personal assets.
3. Limited Skills: The role proprietor must be able to perform many functions and possess skills in diverse fields such as management, marketing, finance, accounting, bookkeeping, and personnel. Although the owner can rely on specialized professionals to provide advice, he or she must make the final decision in each of these areas.
4. Lack of Continuity: The life expectancy of a sole proprietorship is directly related to that of the owner and his or her ability to work. The serious illness of the owner could result in failure if competent help cannot be found.
5. Lack of qualified Employees: It is usually difficult for a small sole proprietorship to match the wages and benefits offered by a large competing corporation because the proprietorship’s level of profits may not be as high. In addition, there is little room for advancement within a sole proprietorship, so the owner may have difficulty attracting and retaining qualified employees.
6. Taxation: Although it is considered that taxation is an advantage for sole proprietorships, it can also be a disadvantage, depending on the proprietor’s income. Under current tax rates, sole proprietors pay a higher marginal tax rate than do small corporations. The tax often determines whether a sole proprietor chooses to incorporate his or her business.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Building Business Pipeline

1. Every week, select ten companies or organizations that meet your ‘target’ market profile. List these names, addresses and phone numbers. Select these carefully and include referrals.
2. Make a research cell to each and identify the most appropriate initial contact. You do not need to speak to this person at this stage, talk to the receptionist or assistant instead.
3. Send a one-page ‘success’ letter and a very brief overview of what benefits you can offer. Mail on a Thursday or Friday. Focus on your capabilities and how you can benefit the prospect.
4. Telephone each ‘suspect’ that you mailed within 3-5 days. As 50 percent will be unavailable, log callbacks in your diary. Don’t be surprised if they don’t remember your letter, review it on the phone. Dropping names or using benefits by association can be useful.
5. Have a prepared call sheet, questions and reasons for an appointment (your goal is a short initial meeting). Offer a benefit to your meeting: share ideas, examples, etc.
6. Set aside time each week for research, mailing and planning – consistency is vital for this to work. You might find it better to aim for one hour a day rather than one whole day each week.
7. Maintain accurate but brief reports to monitor your progress and to track activity.
8. After approximately 10-12 weeks of containing new suspects, reduce the new contacts by between 50 percent and 80 percent and instead go back through all those people you contacted previously and re-contact them, i.e., stay in touch with suspects and prospects every three months. Things often change and if you have selected potential prospects well, it may only be a matter of time before you do business.
9. Make sure that the subsequent 90 day contact contains something new, interesting or different, even if only very slightly. This also makes sure that you don’t appear too pushy.

10.  No matter how busy you get, always make time to keep in touch with new suspects and prospects in this way on a planned and consistent basis.

The rules:

1. Do not allow any one customer to contribute more than 30 percent of you sales in any given quarter.
2. Make sure that at least 30 percent of your sales pipelines is from new business, the rest should be from existing customers or referrals. Do not rely on existing customers to the exclusion of new customers.
3. Always have a third more sales in the pipeline than you need.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Handling Delays

In the sales process, especially in the final phases, delays can represent a frustrating gray area that leaves you hanging, wondering whether or not the customer will buy. After you have proposed a solution, one of three outcomes could take place:

• Decision pending
• Continuation
• Stall.

Decision pending is a waiting period in which the decision has not been made. The reason could be that a key decision maker either was not present when the proposal was made or has not yet made up his mind; or that other, more pressing issues have arisen.

Continuation means that the customer seems to be interested in continuing the relationship with you but makes no specific commitment regarding your proposal.

Stall is a situation in which the customer puts you off or seems evasive. A stall usually indicates a hidden objection. Stalls typically occur after you have asked for a commitment. Use the following tactics to handle a stall:

• Try to find out the real reason for the stall by using your questioning skills.
• If the customer does not buy, find out why.
• Get the objections out in the open and handle them, to determine the real reason for not buying.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

The Drive for Speed

The ‘time culture’ can impose unrealistic deadlines upon those who are charged with the responsibility for delivering improvements. When a supply chain is improved, the single company may be no more able to achieve a tangible impact upon the external environment than it can deliver all the value that is sought by a final customer. When others are involved, there is likely to be bargaining and negotiation.

Environmental initiatives should not result in the pressure for speed or ‘response’ driving out the long-term thinking that is required. Assuming ‘results’ are required, these might best be achieved as a result of flexibility within the framework of a longer term relationship.

Today’s craze can be tomorrow’s memory. Too many managers assume that trends will continue longer than subsequently turns out to be the case. With many environmental and social policies taking many years to have a significant impact, companies face a dilemma similar to that encountered by those seeking to change attitudes and behavior. By the time the outcomes initially sought have been achieved, the requirement may have changed. Will there be a backlash when people count the costs? Will they become bored?

Attempts to deal with ‘isms’ can open a Pandora’s box of dashed hopes and unfulfilled expectations, especially when initiatives are not thought through. Enough noise may be raised to alarm some, while not enough is done to appease or deliver to others. Companies should beware of cosmetic programs.

Winners assemble a comprehensive, complementary and coordinated set of initiatives, embracing all the parties involved, that are likely to have a significant impact upon an environmental or social issue. They achieve significant changes of attitude or behavior, because all the various change elements that are necessary have been put in place.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Leadership Styles

An effective leader recognizes that there are variations in leadership styles. The three basic styles are autocratic, free rein, and democratic. Autocratic leaders make decisions on their own, without consulting others. Democratic leaders involve their subordinates in making decisions. Free-rein leaders believe in minimal supervision, leaving most decisions to their subordinates.

The best leadership style is one that varies with the circumstances, changing according to three elements: the leader, the followers, and the situation. Some leaders are simply unable to encourage or even allow subordinates to participate in decision making. And some followers do not have the ability or the desire to assume such responsibility. Furthermore, the particular situation helps determine which style will be most effective. Problem requiring immediate solutions may have to be handled without consulting subordinates. With less time pressure, participative decision making may be desirable.

A democratic leader may be forced by circumstance to be autocratic in making a particular decision. Managers are increasingly moving toward a more democratic style of leadership. They find that workers involved in decision making tend to be more interested in the overall organization and may be more motivated to contribute to organizational objectives that those not involved in decision making.

No single best style of leadership exists. The most effective leadership style depends on the power held by the leader, the difficulty of the tasks involved, and the characteristics of the workers. Extremely easy and extremely difficult situations are best handled by leaders who emphasize task accomplishment. Moderately different situations are handled by leaders who emphasize participation and good working relations with subordinates.

My Consultancy–Asif J. Mir - Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.