Consumer Sovereignty


Mainstream economics uses some simple starting points; it believes that they are the best possible. First is that agents have more wants than they can attain, so that they feel scarcity; in fact, for practical purposes, wants are assumed to be endless. Second, third and fourth are that agents are self-interested, rational, and the best judges of their own well-being. These four assumptions are indeed usually good starting points, rather than starting by assuming that agents are completely fulfilled, altruistic, irrational, and not well-placed to evaluate their own situation. They are not equally good as finishing points. Sometimes good arguments exist for not accepting them.

An assumption that agents are the best judges of their own well being is less questionable for businesspeople and corporations, given the resources they have for analysis. Debate focuses more on consumers. The phrase consumer sovereignty is sometimes read descriptively, to mean that consumers are sovereign, in that procedures are induced via profit-seeking and competition  to provide what consumers want. Sometimes it is read normatively, to mean that consumers should be sovereign, their wishes should prevail concerning what is good for them. The normative claim can rest on three different bases: that consumers do make good choices; that the alternative stance is worse – to use someone else’s judgments and estimates of what is good for a person and how good it is; or quite differently, that people have the right to make their own choices and mistakes.

Consumers will not make good choices automatically and unconditionally. Our wants are not simple; for example, some are wants to not to have other wants (such as the desire to smoke or a compulsion to gamble). Establishing a mature balance between wants involves skills. Choice is also unlikely to bring satisfaction if taken on the basis of weak information. Markets often do not provide consumers with full and reliable information, for it is hard to exclude people from information and therefore to ensure payment for it, so its market supply is weakened. Instead, in a commerce-dominated society, one of the main types of information that adults get will be images that say the good life is obtained through high consumption of commodities; there is too little counteracting public information.

The issue of consumer sovereignty goes beyond whether choices are good for the chooser. Other people are affected. Some wants may thus be unacceptable, notably wants that bring harm to others, including even wants to harm others. Mainstream economists have unfortunately often taken a don’t-want-to-know approach to ethics in which they confuse acceptance of all wants with a value-neutral stance.

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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Communications: Compliance


Compliance results through a power relationship between the participants in the communications process. That is, a receiver complies with persuasive efforts of the source because the source has the power, legitimate or otherwise, to administrator rewards or punishments.

Because the powerful source controls rewards and punishments, he or she can often induce compliance to his or her advocated position. However, compliance is relatively superficial in the sense that a compliant individual does what he or she is forced to do and does not necessarily adopt the complied-to position as a matter of personal desire or preference.

Sales representatives sometimes possesses a degree of power over buyers, especially in a seller’s market where demand exceeds supply and buyers are dependent on their vendors for supplies of raw materials, parts, or merchandise. Purchasing personnel may feel that if they do not comply with a sales representative’s requests, their orders may be delayed or cut off completely.

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.

Creative Management Operations


Operations management was a major area of organizational creativity in the era of scientific management during the late 19th and early 20th centuries. It got a recharge in the 1950s and 1960s when mathematics and computer science were utilized through operations research models to schedule production, arrive at optimal inventory levels, and so forth. The superior productivity and quality of Japanese manufacturing induced a further revolution in operations management in the 1970s and 1980s, and management vocabulary was enriched by Just-in-time (JIT), Kanban, Total Quality Management (TQM), quality circles, continuous improvement, and so forth. And yet there is much scope for operations-related creativity.

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.

 

Protectionism


When a government sees that local industry is threatened by imports, it may erect import barriers to stop or reduce them. Even threats to do this can be sufficient to induce the exporter to invest in production facilities in the importing country.

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.

 

Disambiguating the Role of Managers


Managers are the employees who are responsible for coordinating organizational resources and ensuring that an organization’s goals are successfully met. Top managers are responsible for investing shareholder money in resources in order to maximize the future output of goods and services. Managers are, in effect, the agents or employees of shareholders and are appointed indirectly by shareholders through an organization’s board of directors to manage the organization’s business.

Managers’ contributions are the skills they use to direct the organization’s response to pressures from within and outside the organization. For example, a manager’s skills at opening up global markets, identifying new product markets, or solving transaction-cost and technological problems can greatly facilitate the achievements of the organization/s goals.

Various types of rewards induce managers to perform their activities well: monetary compensation (in the form of salaries, bonuses, and stock options) and the psychological satisfaction they get from controlling the corporation, exercising power, or taking risks with other people’s money. Managers who do not believe that the inducements meet or exceed their contributions are likely to withdraw their support by leaving the organization.

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.

Mobilizing Support for Change Managers


Despite using the principles of influence, social networks and negotiation, change efforts in an organization can falter for different reasons. There has been a great deal of interest in finding out why people are so unwilling to stop out of their comfort zones and accept change. Some of the major  impediments to change are:

  • People believing that the change effort is yet another fad: Over a period, many employees have come to perceive different change programs as fads because they associate these with previously failed initiatives. As a result, they do not pay attention to the merits of the arguments. Change induces dissonance, and people often reduce the resulting stress by reverting to previously held assumptions, beliefs, and behaviors.
  • People who believe that change agents are not credible: Employees tend to view the strength of the change idea by associating it with the person who advocates that position. In other words, if the change manager is credible, the idea is seen as convincing. On the other hand, when the manager is perceived as untrustworthy, people tend to reject the change ideas.
  • People who have difficulty unlearning old ideas and approaches: Most often, people do not know how to stop what they have already been doing. When they are faced with uncertainty and ambiguity, they feel a sense of loss of control and this leads them to persist with their existing methods and approaches.
  • People who have difficulty learning new patterns of behavior: When people face unfamiliar situations, they often fail to comprehend the complexities of the situation. They may also feel apprehensive that if they try out new behaviors and fail, they would attract criticism. Faced with a fear of failure and believing that change would make little difference, they may refuse to invest in learning new methods and approaches.
  • People who feel that change threatens their identity: When faced with crises or threats, people tend to uphold their pride rather than appreciating the learning challenge that it offers. There is great comfort in existing belief structures, as these constitute one’s personal identity. Any attempt to change behavior may be seen as a challenge to that identity. As a result, it generates resistance to change.

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