Management...

Flirting with Disaster!

by Dr. Maxwell S. Pinto

PITTSBURGH, PENNSYLVANIA 15222

All Rights Reserved

Copyright © 2005 by Dr. Maxwell S. Pinto No part of this book may be reproduced or
transmitted in any form or by any means, electronic or mechanical, including
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Acknowledgments

❖❖❖
This book is dedicated to my family and friends, who have always encour¬aged me to
express myself in terms of the written word. It is my sincere hope, that this book
will provide useful reading to students, lay people and professionals alike.
Special thanks to: Maurice Pinto, Mark Pinto, M.B.A., Ch.FC., Jim Stanton,
Training Consultant, Tousha Pinto, BA, Krishna Prasad, BSc., Aley Thomas, M.B.A.,
Eusebia Fernandez, M.A. Damian Lobo, B.A., Josie Gelacio and others, whose names I
may have overlooked, but to whom I am eternally grateful.
Aaron Pinto, my editor, added the final touches to this book, for which I am very
grateful.

Preface

❖❖❖
Following the tremendous success of ‘The Management Syndrome…How to Deal with
It!’, I was persuaded, by readers, to follow it up with a handy companion, which
could be read in an hour or so. This book is meant to pro¬vide easy reading for
those interested in grasping the essentials of manage¬ment, in a nutshell, as they
say.
The first and second editions of this book were reviewed by business¬men,
professionals, students, and others. The following third edition is based on
feedback and review, by the latter category of individuals.
I have written this book, more like a commentary on management, with illustrations
designed to highlight significant matters. I do hope this book turns out to be a
worthy successor to ‘The Management Syndrome…How to Deal with It!’ which
represents a detailed approach to management. It is available through
amazon.co.uk.

Contents

❖❖❖

Introduction to the Problem . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 1

Food for Thought . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . 3
The Art of Persuasion . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 6
Teamwork . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 7
Performance Appraisal . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 8

Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 9
To be or Not to be…A Robot . . . . . . . . . . . . . . . . . . . . . . . . . . .
9

Employee Dismissal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 10

Open Book Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10
Stress and Humor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 10

Administrative Assistant . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 11
Keepers of the Gate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 11

Just in Time Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . 11
Assumptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 12
Risk and Uncertainty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 12

Corporate Goals and Objectives . . . . . . . . . . . . . . . . . . . . . . . . .

12
Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 13
Seniors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 14 Summer Jobs . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 14

Friendship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 14
Joint Ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 14
Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 14

Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 15 How Special factors influence the Business Environment . . . . . 15

Evaluation involves Comparison . . . . . . . . . . . . . . . . . . . . . . . . .

15
Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 15
Public Speaking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 16

What are the Bottlenecks? . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . 17
Productivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 17
Quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 18
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 19
Communication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 20

Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 21
Simulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 21
Problem-Solving . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 21 Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 21
Japanese Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 21
Generalist or Specialist? . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 21

Basic Functions of a Manager . . . . . . . . . . . . . . . . . . . . . . . . . .

. 22

Time Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 23

Performance Appraisal . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 23
Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 23

Innovation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 23 Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 23 Revolutionary Changes in Industry . . . . . . . . .
. . . . . . . . . . . . . 24
Education for Tomorrow’s Business Leaders . . . . . . . . . . . . . . . 24

The Age of the Computer . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 25

Drucker’s Views on Industrial Relations . . . . . . . . . . . . . . . . . 26

Collective Bargaining . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 26

Decision Making . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 26
The Japanese Decision-Making System . . . . . . . . . . . . . . . . . . . 27
Selling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 28
Solidify the Foundation of Trust . . . . . . . . . . . . . . . . . . . . . . . .
. 29

Building your Business through Referrals . . . . . . . . . . . . . . . . . . 29

Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 30

Negotiation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 30
Labor – Management Negotiations . . . . . . . . . . . . . . . . . . . . . . 32
Is Negotiation a Game? . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 32
International Negotiations . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 32

Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 33
Keeping in Touch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 33
Progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 33

Favors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 33
Organizational Skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 33

The Global Executive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . 33

Business Travel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 34

Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 34

More Food for Thought and Conclusion . . . . . . . . . . . . . . . . . . 35

Counseling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 35
Absenteeism and Tardiness . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 35
 Substance Use/Abuse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 36
To Obey or Not to Obey . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 36

Maintaining a Safe and Healthy Work Environment . . . . . . . . . 36

Feng Shui . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 37
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 38

BIBLIOGRAPHY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39

Chapter 1

❖❖❖
Introduction to the Problem
In recent years, especially in the western world, there has been a tendency to
over-emphasize the importance of short-term results. This has led managers, and
others, to focus on drastic cost cutting, instead of the maximization of the
differential between benefits and related costs. This shortsighted approach to
“management” is what I refer to, as “flirting with disaster”!
This attitude towards management is further compounded by the selec¬tion and
promotion of employees on the basis of friendships, relationships, and other non-
relevant factors, rather than on merit, as reflected by attitude and performance.
In addition, a prospective employee with 15 years experi¬ence in a certain field
should not be assumed to be more effective than an individual with considerably
less experience, in the same field. Experience cannot be measured in terms of mere
numbers; heart, character, versatility, creativity, and robustness, may not be
duly reflected on a resumé!
It is rather unfortunate, that most managers in the corporate world possess
technical ability, without adequate managerial expertise. Consider, for example,
the case of an accountant who happens to be appointed as accounting manager, on
the basis of his / her accounting skills, largely because the person responsible
for the appointment did not realize that there was a dual function to perform:
that of an accounting technician and that of a manager! Managers by occupation
(rather than by profession) are hazardous to corporate welfare, because they
usually do not realize the importance of teamwork, concern, motivation,
preparation and develop¬ment, feedback, communication, inter-personal skills,
tact, and other fac¬tors. These individuals cost the business organization far
more than the salaries they are paid…, yet they continue to be employed and
promoted, without even being tested for adequate managerial skills – this confirms
the application of “The Peter Principle”! Would any sane individual allow him-
self/herself to be taken for a ride in a Mercedes-Benz, which is driven by an
individual who does not possess adequate driving skills, let alone a valid
driver’s license? Why, then, does the farcical trend of appointing “managers”
continue, despite the foregoing?
The proper balance must be struck, between technical skills and mana¬gerial
skills, otherwise a situation may arise, which is similar to the recent collapse
of “Barings Bank”. Nick Leeson’s managers, both in Singapore and in England, did
not seem to have a basic understanding of risks in future trading or about the
basic principles underlying segregation of duties.
Prior to their appointment as managers, employees should be required to enroll in
a sound management-training program. This will help con¬tribute towards an
environment, which fosters brotherhood through effec¬tive leadership, teamwork,
and management. In this context, the Japanese approach to management, as discussed
in Chapter 2, should be reviewed.

Chapter 2

❖❖❖

Food for Thought

Management is the art of inspiring employees (through example, rather than empty
words) to achieve the desired results. To be effective, rather than merely
efficient, a manager must understand and apply the basic principles of leadership.
Managing for results is promoted by skills resulting from educa¬tion, experience,
and the ability to interact favorably with people, while being focused on
corporate objectives, in the face of time constraints. Leaders should be generous
in terms of bonuses, profit sharing, and employ-ee-use (rather than abuse) of some
office equipment for their own personal needs, and so on, to show employees that
these leaders care for their welfare.

Leaders must be knowledgeable, confident and positive, organized, mature i.e. to

look at the overall picture, and not be petty-minded, so that their subordinates
feel the urge to follow them voluntarily. Leaders must be creative, persistent,
and willing to take risks, while being reasonable and rel¬atively flexible in
approach. Moreover, leaders should use the words ‘please’ and ‘thank you’. These
words are magical in more ways than one! Leaders must never underestimate the
value of a good sense of humor because it breaks down many barriers and relieves a
great deal of tension.
Leaders must be ethical in approach, rather than in mere speech and written memos!

Instead of shutting themselves in ivory towers and blindly following computerized

reports, leaders should mingle freely with other members of the organization, in
order to understand the state of the organization and the direction in which it is
headed.

A good leader is one who can significantly influence people to per¬form, in

accordance with the corporate plan and the objectives stipulated therein. In order
to do so, the leader should appreciate the values and feel¬ings of employees and
outsiders, including customers, suppliers, the gov¬ernment, the community and the
general public. A good leader encour¬ages communication and feedback to help
improve corporate results and always accepts responsibility for his/her decisions
and actions. Leaders must have a commitment to listen to their employees because
the latter are involved in the day-to-day operations of the business; their views,
therefore, will increase the firm’s prosperity. When you are receptive to your
employees, you show them that you respect and care for them. This motivates them
to exercise their entrepreneurial skills, which include ini¬tiative and intuition,
thus helping to improve corporate results even fur¬ther e.g. through Quality
Circles (as explained later in this chapter). Excellence in management and
leadership are a pre-requisite for business success, as is the requirement to
train others to be good leaders and elim¬inate the vacuum, which exists in
business!
Effective leaders are champions who help and encourage people to per¬form, instead
of merely flaunting their power. They must realize that with power comes the
responsibility for performance and results. Power should be delegated on the basis
of merit, rather than favoritism!
In their excellent article: ‘Crucibles of Leadership’, which was published in the
Harvard Business Review of September 2002, Warren G. Bennis and Robert J. Thomas
state that “Everyone is tested in life, but only a few extract strength and wisdom
from their most trying experiences. They’re the ones we call leaders.” Bennis and
Thomas proceed to mention that one of the most common types of “crucibles” i.e. a
trying experience they documented, involved the existence of prejudice, the effect
of which depends on how the individual in question deals with the prejudice that
he/she encounters.
There are studies, which confirm that women have an inherent style of management,
which concentrates on building relationships, rather than merely achieving goals.
Moreover, women generally look at the organization as a connected network, rather
than a mere hierarchy of people, although they sometimes have a tendency to group
with other women and gossip or dwell on trivial issues. If the organization does
not look after its people, they will go elsewhere. Nobody is indispensable, but
one should realize that the costs of high employee turnover are tremendous in
terms of the adverse effect on the bottom line!

Organizational culture is the result of shared values, beliefs, attitudes,

assumptions, interpretations, habits, customs, knowledge, and behavior of the
employees in the company. In other words, what lies at the heart of the company
will affect its performance. Therefore, companies must show a rea¬sonable amount
of concern for customers, employees, and others, rather than adopt a short-sighted
approach, which displays a selfish concern for their own pockets! Organizations
should ensure that their employees have easy access to exer¬cise equipment and
sporting facilities, thus helping them to be physically and mentally fit, with
implications for corporate success in the face of volatile economic conditions.
The Art of Persuasion

Without due persuasion, employees and others will not be inclined to share a
leader’s vision, dreams, and confidence. Leaders should use language, which is
simple, precise and positive, while being diplomatic and solution-oriented, rather
than problem-oriented. A positive attitude boosts perform¬ance in many ways.
Although some degree of stress may promote improved performance, people do need
reassurance, from time to time.
The main problem facing managers is change in economic situation, environment,
technology, and the ratio of female to male employees, or whatever else. Before
providing solutions, there must be a thorough analysis of change. There are no
ready made answers since each situation is different. Relying solely on past
experience to provide solutions to existing problems, therefore, may contribute to
an adverse effect, which may snowball over a period of time!
Change is necessary for improvement but should rest on a solid founda¬tion of
reason, rather than be part of an experimental approach, along the lines of a
“trial and error method”. People, who will be affected by the change, should be
informed of its significance in advance of implementation, thus minimizing or
eliminating emotional or other disturbances. Managers should ensure that employees
and trade unions understand and appreciate the need for the required change and
co-operate, accordingly.
The Management by Objective (MBO) approach (where main objec¬tives are broken down
into sub-objectives, for the purpose of the latter being achieved, through
delegation of responsibility) is desirable for sound decision making. It is of
paramount importance that the exact nature of the problem be determined and
understood, otherwise the proposed solution will be irrelevant, and possibly
detrimental, to the welfare of the company! Questions, which are thought
provoking, should be asked through brain¬storming, which encourages the expression
of different views that are based on different perspectives. Remember, while
brainstorming, there is no right or wrong solution – just note down the ideas as
they flow un-edited! The company should be fully aware of the nature of its
business e.g. hair cutting or hair styling, razor blades or hygiene products for
men, railroad or trans¬portation, and should have the flexibility to adapt to the
customers’ other (present and possible future) needs. Group harmony and co-
operation with¬in a team environment, are desirable.
Research shows that more than 80% of successful business enterprises base their
decisions on logic (rationalism) and intuition (gut feeling), but the latter
should not be confused with impulsiveness i.e. a rash approach to deci¬sion
making.
Teamwork

Teamwork can be defined as the collective action of a group of individuals, in

pursuit of a common goal (or set of goals). Individuals are selfish in nature, in
terms of focusing on their own personal goals. Therefore, they need to be cared
for and motivated, to perform in accordance with corporate objectives and related
plans.
During the past few decades, there has been a steady shift from the need for
entrepreneurship, land, labor, and capital towards an increasing empha¬sis on the
main resource: people. People are the life-giving element in any organization. In
the new millennium, there will continue to be a growing need for relevant,
accurate, and timely information (which is organized in a manner that facilitates
effective decision-making) to be provided to properly selected and motivated
personnel who operate within a team environment. This will facilitate the
transition from corporate dreams into reality. In other words, the success of a
business enterprise is definitely a function of its employees who constitute the
main investment (rather than an army of slaves), even in the presence of competent
owners and managers.
A business enterprise needs dynamic team players with excellent com¬munication,
inter-personal skills, different professional backgrounds, and perspectives.
Owners, managers, and other employees should be receptive to the views of others,
in an attempt to make the right decisions, rather than merely inflate their
personal egos! Making the right move is far more impor¬tant than simply satisfying
one’s ego; the cost of which could be astronomi¬cal. Members of the team may
change, according to the goal in mind, but they should complement, rather than
compete with, one another while focusing on the objective at hand!
Andrew Carnegie was a great team builder, since he selected better peo¬ple than
himself and always encouraged peak performance through synergy and a positive
attitude. Instead of hiring employees who are less capable than yourself, in an
attempt to safeguard your position and your family income, hire the best. Then,
lead these employees by example, motivate them with meaningful work, increase
their responsibility, give them challenges and rewards, and empathize with them
when necessary. Such employees will help promote growth and overall welfare.
Members of a business enterprise should have the ability to interact favorably
with people of different nationalities and cultures while always respecting their
values.

The customer should always be considered as part of the team. Encourage feed¬back
from customers, research into their needs and wants, and do your best to satisfy
them.
Building a successful relationship with customers will yield dividends throughout
the (perpetual) life of the business. Loyal clientele will behave like fans and be
more than happy to generate referrals at no cost to the busi¬ness enterprise.

Performance Appraisal
Until the 1990s, the Japanese believed in lifetime employment and pro¬motion based
on seniority, rather than on performance appraisal, which highlights strengths and
weaknesses. Peter Drucker attaches importance to the character of the individual,
whose performance is being appraised.

Resources
If resources, including people, become scarce, do we have alternative sources or
substitutes? Our main resource is people! Are we fully covered against their
deliberate or unexpected departure from our business enterprise? The organization
should not fall to pieces in the absence of any given individual. Managers should
ensure that no individual is indispensable, or the business enterprise will falter
in the latter’s absence. This is totally unacceptable!

To Be or Not to Be … a Robot?
Whereas some robots perform high quality labor tasks, others perform basic
tasks.

Robots provide a cheap and reliable source of labor with no fear of dis¬ruptions
due to strikes, illness, holidays, or any other reasons. Moreover, robots never
tire, even after a 24-hour shift. Therefore, the possibility of breakdown is
minimal, and management can concentrate on other elements, such as logistics,
transportation costs, attracting first class management tal¬ent, and so on, when
selecting a suitable location. Robots usually reduce operation costs, help
facilitate lower breakeven points, and increase compet¬itiveness, but they must be
chosen carefully in accordance with specific needs. Special care must be taken so
as not to alienate employees and unions, who should be allowed to control and
supervise the robots, while training them to perform in line with approved
standards. Moreover, displaced work¬ers should be re-trained and given assurance
of job enrichment.

Employee Dismissal
Before dismissing an employee, the individual in question should be (tactful¬ly)
warned and given a fair chance to improve. This is a matter of common courtesy;
furthermore, it reduces the likelihood of being sued for unfair dis¬missal, and
consequent expenses: loss of reputation, as well as a loss of focus. Employers
should encourage “cross - fertilization of duties” i.e. more than one person
should understand the functions relating to each job; also, each job should have
procedures documented so that no one is indispensable. This will reduce costs
associated with employee absenteeism and turnover.
When dismissing an employee, managers should be honest and diplo¬matic, while
arranging for the necessary transfer of duties, so that there is no void upon
dismissal. Be kind to the employee being dismissed and offer assis¬tance, where
practical.

Open Book Management

Open book management allows employees to take the initiative, as though they were
owners; thereby giving them due importance, but this requires open com¬munication
between all employees, even if it means showing them the financial statements.
Thus, every individual has a fair chance to contribute to corporate success, but
also must be given a chance to own equity and be rewarded fairly for the
achievement of positive results, in line with corporate goals.
Human Resource managers should exert extreme care when selecting appro¬priate
personnel to operate within the corporate environment while encouraging these
individuals to grow in accordance with present and future needs of the busi¬ness
enterprise. Employees should be trained continuously, in order that they might
meet emerging challenges, in the volatile business environment.
Human beings need a degree of relaxation, in order to perform consistent¬ly, in
line with corporate objectives. Short breaks should be taken during work¬ing
hours, from time to time, in order to enable employees to remain effective, on a
continuous basis, throughout the working day. Such breaks should not be monitored
to the nearest second; otherwise managers will be guilty of demoti¬vating their
subordinates, with adverse consequences for the bottom line!
Stress/Humor

Humor helps relieve stress, to a great extent, as does delegation, vacations (even
brief ones), and exercise. Reading good books on management, being positive, going
to new places, and eating new foods from time to time, also help to relieve
boredom.
Research in the field of management has led us to believe – and rightly so – that
stress is one of the main factors influencing performance on a per¬sonal, as well
as a corporate, level. Stress exists because of problems encoun¬tered by people at
home and at work. Therefore, in order to improve per¬formance, managers must
realize that they have to reduce, or (possibly) elim¬inate, stress from the work
environment.
A strong concern for human welfare on this planet, coupled with a deep rooted
interest in organizational psychology, have prompted some human resource
professionals to shoulder the responsibility for bringing out the best in people.
This promotes the welfare of the individual, the business enter¬prise, society,
and the economy in question.

Administrative Assistant
The role of an administrative assistant is often as important as that of a spouse.
It is, therefore, necessary to exert caution when selecting an admin¬istrative
assistant. The nature and scope of the administrative assistant’s job functions
should be precisely defined in advance. While it is necessary to set a good
example in terms of character/integrity, one should also display a good sense of
humor while being aware of the implications, in terms of sex¬ual harassment.

Keepers of the Gate

Gatekeepers are individuals who can facilitate or block a message intended for
somebody else. In the book publishing business, for example, book reviewers
function as gatekeepers since their reviews influence the selection process of
bookstore managers, and the final demand created by the intend¬ed book audience.
Therefore, in an attempt to impress the book reviewers concerned, the publishers
spend a considerable amount of time and effort in designing the appropriate book
jacket and catch phrase.

Just – in – Time Inventory Management ( JIT )

Just-in Time inventory management involves the ordering of inventory items as, and
when, they are needed. JIT is the result of sound planning and forecasting, as
well as excellent quality control, duly supported by all employees. JIT leads to
lower costs of holding inventories, in terms of capi¬tal tied up, storage space,
furniture for storage, insurance costs, and labor involved in inventory
management. It requires that production be standard¬ized. JIT should be phased in
gradually while allowing for a smooth transi¬tion without any adverse effects on
customers and goodwill, which could otherwise result from stock outs. Suppliers
should be easily accessible, oth¬erwise transportation, delivery costs, and time
lags may offset the advantages of JIT.

Assumptions
Are our assumptions current and realistic? Are these assumptions backed by logic,
experience or intuition, and are we able to distinguish between assumptions and
facts? Unrealistic assumptions will yield fruitless results!
Risk and Uncertainty

What does the future hold for the business enterprise? Whose crystal ball should
we use to predict the future in terms of trends and prospects?

Corporate Goals and Objectives (based on Corporate Vision)

Are we doing the best we possibly can, or are we stuck in a groove, in which we
feel comfortable and have a false sense of security? Do we have any con¬tingency
plans? Have we ever considered selling technology instead of, or in
Seniors

Consider the possibility of hiring members of the senior community, many of whom
have the required ethics, knowledge, and skills to promote organi¬zational
effectiveness, at a reasonable cost. A certain amount of training will be involved
e.g. keeping up to date with computer technology and applica¬tions. Employing such
individuals will help them restart their lives, thus pro¬moting corporate
goodwill.
Summer Jobs Consider the possibility of employing students, during the summer
spell, while making them aware of the rules and procedures of the organization and
the fact that they are subject to the same rules without any exceptions. This will
help students accept responsibility and learn to gradually acquire a taste of the
real world, while promoting corporate goodwill.

Friendship
Friendship among employees promotes goodwill and teamwork. Friendship should not
be abused or allowed to destroy objectivity, especially in relation to appraisals,
reviews, promotions, salary increases, hiring, firing, and so on. Aristotle, a
Greek philosopher, claimed that friendship is “indispensable to life”!

Joint Ventures
Joint Ventures enable costs, responsibilities, and duties to be shared, but the
functions of each party should be precisely defined to help avoid cutthroat
approaches by either party to the joint venture. Synergy is the main reason that
leads to the formation of joint ventures.

Markets
Should we make regular cars, sports models, or a combination? Before pro¬ducing,
business organizations should test the market’s preferences. Testing the market
should not be restricted to the type of product, model, or indeed its “bells and
whistles”. Different countries have different beliefs, symbols, and
interpretations of the latter. For example, in the 1970s, General Motors-Chevrolet
produced a car called ‘Nova’ for Brazil; this car was considered to be of good
value for the money. However, the ‘Nova’ failed in Brazil, because “Nova” i.e.
“Nao Va” in Portuguese means “No go” – hence, the Brazilians refused to buy it!
Chevrolet, instead, turned its efforts to the Middle East where its performance
was quite disappointing.

Trends
Peter Drucker is almost universally regarded as the “guru” of business
man¬agement. In his book ‘The Age of Discontinuity’, Peter Drucker warned that, in
our technologically based society, we have to be on guard for the discon¬tinuing
of trends and obsolete jobs.

How Special factors influence the Business Environment

We must always be aware of government policies, technological changes, financial
realities, and the responses of our competitors e.g. standardization of
videocassettes was brought about as VHS systems and cassettes wiped out Sony’s
Betamax system. Always allow employees to participate in the decision making
process that affects them; this will facilitate ease of implementation (of the
decision).

Evaluation involves Comparison

Evaluation involves comparison, but what are the bases for that comparison? There
are at least 3 possibilities: past, planned, and potential performance.
Comparisons with the past make sense only if the conditions are similar.
Comparisons with planned performance take into account present condi¬tions and our
ability to plan and execute. Comparisons with potential per¬formance take into
account possibilities.
Reports

Reports merely provide one source of information; other important sources include
observation, conversation, and the behavioral pattern of employees and outsiders,
including customers, suppliers, the market, and the govern¬ment – therefore, do
not regard written or computerized reports as gospel!
Accounting reports are useful, though often historical rather than cur¬rent, and
do not paint the whole picture. Therefore, one should also consid¬er the effects
of poor quality, lack of motivation, material shortages, cus¬tomer
dissatisfaction, machine breakdowns, failure to undertake research and development
leading to innovation, and so on.
A business enterprise should concern itself with:
(a) Customer satisfaction
(b) Liquidity position
(c) Productivity of all employees and equipment and the Innovative ability to
maintain longevity
(d) ‘What if’ analysis with different scenarios
(e) Managing tax payments and tax liabilities through tax avoidance, rather than
tax evasion, and other factors.

Public Speaking

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