Decisions: Considering Alternatives

An ideal alternative perfectly fulfills every condition set for it without adding new difficulties. Unfortunately, ideal alternatives are rare. We must, therefore, evaluate each available alternative by measuring it against all of our objectives. It is the relative quality of that fit that concerns us.

If we must choose among several alternatives, we will have to decide which one will best fulfill our objectives with the smallest acceptable risk. In other words, we try to make a balanced choice. An alternative that best accomplishes the objectives but carries severe risks is not, after all, the best choice. Another alternative, perhaps less exciting but safer, may be the best balanced choice.

If there is only one alternative, we must decide whether it is good enough to accept. In this case our evaluation will focus on its relative worth compared with a perfect but unobtainable alternative.

If we must choose between a current and a proposed course of action, then we consider both to be alternatives. We evaluate their performance against our objectives just as we would if both had been proposed. Whatever is currently being done is, after all, an alternative; the choice is whether to continue that way or find another, better way.

If, in the absence of any alternative, we must create something new, we can usually build an alternative from available components. We then choose the best and most feasable combinations, treat each as a separate alternative, and evaluate all of them against an ideal model of an alternative.

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, Lectures, Line of Sight

Distinctive Capabilities

A close examination of a market-driven firm will reveal two particularly important capabilities: market sensing and customer linking. First, the market-sensing capability concerns how well the organization is equipped to continuously sense changes in its markets and to anticipate customer responses to marketing programs. Market-driven firms spot market changes and react well in advance of their compititors. Second, the customer-linking capability comprises the particular skills, abilities, and processes that an organization has developed to create and manage close customer relationships.

Customer-goods firms demonstrate these capabilities in working with powerful retailers, multifunctional teams in both organizations work together by sharing delivery and product movement information and by jointly planning promotional activity and product changing. While evident in manufacturer-reseller relations in the consumer-goods market, strong customer-linking capabilities are crucial in the business market where close buyer-seller relationships prevail.

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, Lectures, Line of Sight

Objectives of Advertising

There are at least three different viewpoints taken in attempts to evaluate the contribution of advertising to the economic health of the firm. The generalist viewpoint is primarily concerned with sales, profits, returns on investment, and so forth. At the other extreme, the specialist viewpoint is represented by advertising experts who are primarily concerned with measuring the effects of specific ads or campaigns. A middle view, one that might  be classified as more of a marketing management approach, understands and appreciates the other two viewpoints but, in addition sees advertising as a competitive weapon. Emphasis in this approach is given to the strategic aspects of the advertising function.

Building on objectives for advertising can be assigned that focus on creating awareness, aiding comprehension, developing conviction, and encouraging ordering. Within each category, more specific objectives can be developed that take into account time and degree of success desired. Obviously compared to the large number of people advertising makes aware of the product or service, the number actually motivated to purchase is usually quite small.

In the long run and often in the short run, advertising is justified on the basis of the revenue it produces. Revenue in this case may refer either to sales or profits. Economic theory assumes that firms are profit maximizers, and the advertising outlays should be increased in every market and medium up to the point where the additional cost of gaining more business equals the incremental profits. Since most business firms do not have the data required to use the marginal analysis approach, they usually employ less sophisticated decision-making models. There is also evidence to show that many managers advertise to maximize sales on the assumption that higher sales mean more profits (which may or may not be true).

The point to be made here is that the ultimate objective of the business advertiser is to make sales and profits. To achieve this objective, the actions taken by customers must encompass purchase and continued repurchases of the advertised product. Toward this end, an approach to advertising is  is needed that provides for intelligent decision making. This approach must recognize the need for measuring the results of advertising, and these measurements must be as valid and reliable as possible. Marketing managers must also be aware that advertising not only complements other forms of communication but is subject to the law of diminishing returns. This means that for any advertised product, it can be assumed a point is eventually reached at which additional advertising produces little or no additional sales.

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, Lectures, Line of Sight

Crisis Communication

One of the most visible functions of the PR department is to help management plan for and respond to crisis. A good PR professional looks for potentil problems, constantly scans the business environment, then alerts management to the implications of such problems, and suggests the best course of action.

Disasters of earthquake proportions fall into the category of public relations nightmares created by sudden , violent accidents. Plane crashes, oil spills, chemical leaks, and product defects all belong to this group. The other type of crisis is the sort that builds slowly and occurs because of a company’s conscious, but ill-founded, decisions.

Whn disaster strikes , a defensive posture is generally counterproductive. The best course is to be proactive, admit your mistakes and apologize.

When disaster hits most companies respond, to some degree, through their public relations department, but they often ignore the audience that is likely to be hit hardest—employees. To minimize the impact of any crisis on employees, be sure to communicate honestly, openly, and often, actively encourage employees to share their concerns, and use caution when sharing personal opinions.

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, Lectures, Line of Sight

Intuitive Leadership and Sound Business

Intuitive Leadership is a term that has come into vogue only recently. In fact, tough-minded male executives have confessed to using intuition in their decision-making. Intuitive leadership is more than simply old-style leadership with some intuition added in to guide the corporate decision. It is leadership that takes into account both (a) the executives’ appreciation of their inner resources that are available but often not used and (b) the changes in institutions and society that are accompanying the “awakening” of employees and the public at large. The term “awakening” is used to describe the general phenomenon whereby people are becoming aware that they no longer have to accept their adopted beliefs, beliefs that they developed or accepted throughout most of their lives. These beliefs can include belief in the inderiority of certain ethnic or gender groups, beliefs in the sacrosanctity of economic customs and business practices (even if they are demonstrably not good for people or the planet), belief in powerlessness before the “big system,” or belief in the limited extent of one’s own ability to create what one wants.

In view of these changes, what is sound business for the future? What do these changes mean to business people? Of one thing we can be sure: business life will be replete with challenges. Some of these challenges will stem from the global dilemmas, with growing recognition of the role business has unwittingly played in accelerating modern society’s race towards self-destruction. Some of these challenges will stem from the changing attitudes of employees and the general public—the customers. The new environment for business will emphasize innovation and will be highly competitive. To prosper in such an environment, a business firm will need to attract and hold its most creative people. To do that, businesses will have to provide a work environment that fosters creativity development.

Developing intuitive leadership in the future will not be a luxury or a passing fad; it will be the heart of business. The challenges will be great. It will be necessary to deal effectively with the increasing complexity, interconnectedness, and systematic nature of the economic system. There is both good news and bad news. The bad news is that there will be persistent problems of mediocrity, debt, trade balance, global dilemmas, and worker morale. The good news is that we have inner resources we haven’t been using—untapped resources that are quite capable of dealing with these problems.

Thus “intuition” is not just a new gimmick in management decision making. Intuition is a code word for a necessary transformation of business—indeed, of global society.

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, Lectures, Line of Sight

Not Right or Wrong, Cultures are Just Different

People around the world feel as strongly about their culture as we do about ours, even if they do occasionally feel ambivalence. It is pointless to argue whether a culture is “good” or “bad;” every nationality thinks its culture is the best. For every foreign peculiarity that assumes us, there is our national peculiarity that amuses others.

Cultures have their own logic. Anthropologists say cutures are different because various peoples had to deal with diverse circumstances to meet their common human needs: different climates, different climates, different resources, different terrain. Just as animal species evolved differently to adapt to different conditions, so mankind evolved diverse solutions to life’s problems. Over the years the complex array of solutions to problems (many of which disappeared long ago)  created a confusion of cultural behaviors. But there are patterns, and one can begin to understand them by considering the different past, present and future of the cultures of the world.

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, Lectures, Line of Sight

Design Entry and Exit Strategies

Astra Zeneca does fundamental research to develop new drugs; Halifax Bank designs new types of accounts; Microsoft designs completely new software. These companies look for the high profits that come from new products, but they have to bear the cost of research and development.

These companies follow a product for its entire life cycle. But most organizations do not start with basic research to develop entirely new products – neither do they continue making a product through its entire life. They find existing products that fit into their range, and modify these to create their own ‘new’ product.

Organizations generally start supplying a product that is already some way through its life cycle. The time when they start, and later stop, making a product defines their entry and exit strategy. The best entry and exit strategy depends on your expertise and objectives. Your organization might be:

• Research driven these are good at research, design and development, but they lack the resources and production skills to manage a growing  demand. They work in the introduction stage, and leave before the growth stage.
• New product exploiters. These look for research that has commercial potential and then exploit it during the growth stage. They use strong marketing and process design to get the high prices available during growth, and then exit when profit margins begin to fall.
• Cost reducers. These design very efficient operations, so they enter the market at the mature stage and produce large quantities efficiently enough to compete with organizations already in the market. They exit when sales fall too low to maintain high production levels.

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, Lectures, Line of Sight

Deming’s 14 Obligations

Many people helped develop quality management, and some of the early ones are called the ‘quality gurus.’ Perhaps Edwards Deming was one of the best known. He did a lot to publicize TQM. But was concerned that organizations did not get the benefits they expected. To help them on the way, he compiled a list of guidelines called his ’14 obligations.’ They are:

1. Create constancy of purpose towards product quality.
2. Adapt the new philosophy of higher quality, refusing to accept customary levels of defects and errors.
3. Stop depending on mass inspection, build quality into your product.
4. Don’t award business on the basis of price only – reduce the number of of suppliers and insist on meaningful measures of quality.
5. Develop programs for continuous improvement of your products and processes.
6. Train all your employees.
7. Focus supervision on helping employees to do a better job.
8. Drive out fear by encouraging two-way communication.
9. Break down barriers between departments and encourage problem solving through teamwork.
10. Don’t use posters and slogans that demand improvements without saying how to achieve them.
11. Eliminate arbitrary quotes and targets that interfere with quality.
12. Remove barriers that stop people having pride in their work.
13. Have programs for lifelong education, training and self-improvement.
14. Put everyone to work on implementing these 14 points.

Deming’s 14 points are not a program that has fixed duration, but the give a new way of thinking in your organization. They are certainly not the only possible view, but they do give some useful guidelines.

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, www.youtube.com/asifjmir, Line of Sight

Process Matters

Many successful people and organizations start to believe it is the product that brings success. A premier product, however, is the result of a process—studying the market, listening to the customer, experimenting, innovating, taking risks, and working your tail off. That is what created and sold the product.

The common mistake is to cling to the product, rather than recognize the process. The product and the producer then become stagnant while the market and the competition are changing. While you you are holding your product up to the limelight, somewhere, someone is about to pass you by. If you stop focusing on the process, learning, change, and innovation top, too.

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, www.youtube.com/asifjmir, Line of Sight

Knowledge Entrepreneurs

There depends a lot on the energy and imagination of knowledge entrepreneurs. They need to identify specific opportunities being created by the greater availability and accessibility of information and knowledge, and craft distinctive information and knowledge-based products and services.

All entrepreneurs have to identify opportunities to add value by meeting requirements that are not being addressed, and they must be focused and tenacious and possess a clear sense of direction. Most entrepreneurs need also to be tough, pragmatic and resilient. In addition, knowledge entrepreneurs need the following qualities:

• They must know how to acquire, develop, share, manage, exploit and capitalize on information, knowledge and understanding, and be able to help and enable others to use and apply them effectively. This may require combinations of emerging technologies to connect relevant people and organizations together, and competencies to network with others, work and learn in new ways in order to create value, lead and manage virtual teams, and establish and manage knowledge businesses.
• They need curiousity and drive to undertake intelligent searches and to be able to judge or determine the significance, relevance and value of what they uncover. Many more people can access information than assess it or use it effectively. Understanding where information has come from, the underlying assumptions and how it has been compiled can prevent an enterprise or a course of action from being built upon foundations of sand.
• They require enough understanding of systems to be able to use an appropriate range of technologies to identify and access relevant sources of information, knowledge and understanding. However, technical expertise is unlikely to be enough. Communication and relationship-building skills are also required to interact with information providers and bring together the combination of experience and knowledge needed to assemble a package that has market value.

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, Line of Sight