Policies that Empower


Policies communicate guidelines to decisions. They are designed to control decisions while defining allowable discretion within which operational personnel can execute business activities. They do this in several ways:

  1. Policies establish indirect control over independent action by clearly stating how things are to be done now. By defining discretion, policies in effect control decisions yet empower employees to conduct activities without direct intervention by top management.
  2. Policies promote uniform handling of similar activities. This facilitates the coordination of work tasks and helps reduce friction arising from favoritism, discrimination, and the disparate handling of common functions—something that often hampers operating personnel.
  3. Policies ensure quicker decisions by standardizing other policies that otherwise would recur and pushed up the management hierarchy again and  again—something that required unnecessary levels of management between senior decision makers and field personnel.
  4. Policies institutionalize basic aspects of organizational behavior. This minimizes conflicting practices and establishes consistent patterns of action in attempts to make the strategy work—again, freeing operating personnel to act.
  5. Policies reduce uncertainty in repetitive and day-to-day decision making, thereby providing a necessary foundation for coordinated, efficient efforts and freeing operating personnel to act.
  6. Policies counteract resistance to or rejection of chosen strategies by organization members. When major strategic change is undertaken, unambiguous operating policies clarify what is expected and facilitate acceptance, particularly when operating managers participate in policy development.

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.

 

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From Financial Capital to Human Capital


The new corporation differs from the old in both goals and basic assumptions. In the industrial era, when the strategic resource was capital, the goal of the corporation could only have been profits. In the information era, however, the strategic resource is information, knowledge, creativity. There is only one way a corporation can gain access to these valuable commodities—that is, through the people in whom these resources reside.

So the basic assumption of a re-invented company is that people—human capital—are its most important resource. What used to be one of the radicals’ favorite slogans, “People before Profits,” is finding its way into the boardroom and being transformed into a more businesslike but equally humanistic “People and Profits.”

In an information age society, human resources are any organization’s competitive edge.

One expression of the importance of human capital is the new corporate preoccupation with health and fitness. Corporations are treating their human assets with new concern, encouraging their people to stop smoking, lose weight, exercise, and learn to manage stress. What might have been considered an intrusion into one’s personal life in the past is fair game when people are a company’s strategic resource.

The new re-invernted corporations stress inordinate regard for the two most important types of people in an enterprise: employees and customers.

They have discovered that by being both pro-people and pro-profits, a company can earn more than it it had targeted profits as its only goal.

It is not a question of being nice to people. It is simply a recognition that human beings will make or break a company.

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

Monopolistic Competition


It is assumed that—as in pure competition—firms do not collude on price or quality, and also that free entry into the industry (or exit from it) is possible. The monopolistic element in monopolistic competition is product differentiation: each firm has its own unique variety of product. This gives the firm some monopoly power, since each enterprise will have a “clientele” of customers closest to it on the ring of preference. In a particular city, for example, there may be a dozen supermarkets. They may be closely competing in some respects, but each has some monopoly power due to geographical location on other special features that make it the favorite of a fraction of the customers. We see that a group of monopolistically competitive firms produce more and charge less than would a monopolistic operating several plants.

 Each independent firm would produce more output than a monopolistic  would allow its point to produce. The reason is that the independent firm’s perceived demand curve is more elastic (flatter) than the monopolist’s per-plant demand curve.

 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

What Great Managers Know


Conventional wisdom encourages you to think . People’s natures do change, it whispers. Anyone can be anything they want to be if they just try hard enough. Indeed, as a manager it is your duty to direct those changes. Devise rules and policies to control your employees’ unruly inclinations. Teach them skills and competencies to fill in the traits they lack. All of your best efforts as a manager should focus on either muzzling or correcting what nature saw fit to provide.

 Great managers reject this out of hand. They remember what the frog forgot: that each individual is true to his unique nature. They recognize that each person is motivated differently, that each person has his own way of thinking and his own style of relating to others. They know that there is a limit to how much remolding they can do to someone. But they don’t bemoan these differences and try to grind them down. Instead they capitalize on them. They try to help each person become more and more of who he already is.

Simply put, this is the one insight echoed by tens of thousands of great managers:

  • People don’t change that much
  • Don’t waste time trying to put in what was left out
  • Try to draw out what was left in
  • That is hard enough.

This insight is the source of their wisdom. It explains everything they do with and for their people. It is the foundation of their success as managers.

This insight is revolutionary. It explains why great managers do not believe that everyone has unlimited potential; why they do not help people fix their weaknesses; why they insist on breaking the “Golden Rule” with every single employee; and why they play favorites. It explains why great managers break all the rules of conventional wisdom.

Simply though it may sound, this is a complex and subtle insight. If you applied it without sophistication, you could quickly find yourself suggesting that managers should ignore people’s weaknesses and that all training is a complete waste of time. Neither is true. Like all revolutionary messages, this particular insight requires explanation.

 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