In this massive competitive business world, no organisation can stay alive without innovating or introducing new products or services.
--BY AMULYA POKHAREL
Gone are the days of managing business organisations by intuition, trial and error, and rule of thumb, and so forth. Different threats, challenges and oppositions more than ever have changed the ways of organisational management. These challenges in management have added new dimensions over the years and also to the task of managers in the 21st century, which stems from the fact that organisations are viewed as an open system and need to invariably operate under the exogenous environment. For this and if not for any other reason, managers need to be the key change agents responding to the emerging challenges in an attempt to remain abreast of the new business order that is driven by the ever changing business variables, cutting-edge competition and turbulent business and economic conditions, to name but a few. For managers alike all over, these are the emerging challenges in the 21st century of management.
Globalisation of Business
The impact of globalisation has become so much so that the world has become a small village. Entry into the WTO and international trade has stifled every barrier for countries to outsource their ideas, expertise and know-how. This is not the whole story: the thirst for doing business on a global scale has given rise to what are so popularly known as Multinational Corporations (MNCs) whose products, technology and/or services have flooded the whole world. Not even a single economy is left insulated from the impact of globalisation. As such, the work of a manager has become more and more complex. They need to think globally while operating locally. Strategic alliances, cross-border businesses and multi-national companies are dominating small businesses. Managers, therefore, should feel the pulse of globalisation and live on a global maxim. Managers, unaware of mass production, scale of economies and superior deliverables at down-to-earth prices are sure to vanish in the globalisation game. Therefore, the last resort for managers is that they need to oversee the impact of globalisation, have modern technology and gain comparative advantage via international management. Talking about a borderless world is not enough. Managers need to make it a way of living.
Quality Assurance and Productivity
For customers are quality-driven and managers must be up to the mark. To put it in its next best form, quality assurance is the key to a product’s success. Insofar as quality is a common concern, every manager must commit themselves towards meeting the quality standards. Products, if otherwise, are spurious subjecting people to different health-hazards, sure to fail in the market where all organisations are strategising their move towards improving the quality of their products even beyond the standard under question. Productivity, on the other hand, is a matter of serious concern amongst the managers. Because productivity has a direct link towards the quality and cost, it is needlessly the driving force for an organisation's success- in that every manager must conceive and materialise the idea of mass production. Increasing the scale of production is to reduce the cost substantially thereby producing quality goods.
Ethics and Social Responsibility
Conventionally, business organisations were profit-driven. Profit was the sole reason for doing anything business like. But this concept has changed over the years. Ethics and Social Responsibility today, in fact, constitute a wider coverage on corporate governance. Organisations have started becoming more and more ethical and socially responsible. In fact, Corporate Ethics and Corporate Social Responsibility have gathered a place in the strategic blueprint of every organisation. Different professionals and authorities are talking about business ethics and their social responsibility. Because business is of the society, for the society and by the society, managers should not fail towards meeting the aspirations of the public in general. Having received so much support and patronage from the society, it is the responsibility of every manager to comply with the code of conduct and behave in a socially responsible manner.
Innovation and Change
Innovation is the bringing of radical change in everything that an organisation does. In other words, innovation means producing new products or improving the existing way of doing things. Innovation and change is the only way for organisations to remain alive in the cut-throat competition of business. This is the bedrock of existence, survival and growth of any organisation. In this massive competitive business world, no organisation can stay alive without innovating or introducing new products or services. Success will go to those organisations that continually improve the quality of their products, for product lifespan has been shortening every day. Thus continuous improvement, up gradation and upholding change are some of the challenges for managers in the 21st century.
As such, innovation is a source of competitive advantage which enables the production of technology-embedded and differentiated products and services that creates value to the final consumers.
Workforce diversity is a reality today and is immensely underscoring the importance of a manager's job in the present-day setting. Workers from diverse backgrounds and cultures are surprisingly increasing and managers seem to be lost in dealing with them. A diversified workforce consisting of knowledge workers, work teams, virtual teams and contingent employees has gathered force over the years. Unlike any time in history, the participation of women and minorities has been increasing and organisations are becoming more and more heterogeneous in terms of gender, race, ethnicity, and other backgrounds. In this respect, managers need to realise that employees come with their own cultural values and lifestyle preferences. Managers, therefore, need to shift their approaches and philosophy to workforce management and enter into the era of the diversified worker pool with visionary leadership on their part.
This refers to the process or method of doing things. For organisations are ruled as systems and technology is a must. Technological improvements are critical to organisations and they need to be exposed to technological breakthroughs to remain competitive over other organisations. Technology, for instance, has reshaped business organisations due to the advancement in computers which helped management in areas such as information system, data processing and the like. Thus, running organisations technology-wise is a painstaking job for managers. Put in its next best form, technology is the driver of innovation and change in this new economy where linking resources and innovation to the overall strategy of an organisation is inextricably important. As such, technology is the new leverage or a force for good.
Organisations all over are becoming predominantly knowledge-based. Managers will need continuous learning and knowledge updating to manage learning organisations. Employees, on the other hand, also must stay relevant through continuous learning and broadening their knowledge horizons. Both enhanced in terms of knowledge capital can lead to winning organisations. Thus, the practice of continuous learning for all members must be the central issue at every winning organisation. In fact, in a knowledge-based model, knowledge is kept at the centre and everything revolves around it. Knowledge management is therefore an emerging challenge for managers alike all over.
As said by the revered American management consultant Peter Drucker, the 21st century is about knowledge management and the workers of this knowledge era are called Knowledge Workers. In knowledge management, knowledge workers create an organisation as a learning entity therefore contributing to the concept of a firm as a ‘going concern’ and adaptation.
E-Commerce is a tool of this century. It can be utilised by firms to gain an online presence thereby altering the basis of competition. E-Commerce is a given thing and organisations should invest in an online presence for promotion, branding and communication so that they don’t get hit by late-moving disadvantages. It provides structure and a spine for firms to get ready as competitors and be part of the mainstream within the updated industry.
Business Intelligence (BI) and Business Analytics (BA)
Business Intelligence and Business Analytics are impacting organisations like never before. They test the limits of organisations to the core and reshape the foundations of structure and competition. As such, organisations need rapid learning to convert the internal input (people, technology, process and resources) into competitive advantage for exploiting opportunities. As the business and industry landscapes undergo change, organisations need to peel their skin off for a makeover of the century.
Entrepreneurship is the fulcrum of growth and innovation. It fosters new competition and creates companies that are ready to take on the future. Entrepreneurship harnesses new blood for inventiveness and discovery and creates winning organisations that build society. Entrepreneurship coupled with Artificial Intelligence (AI) and Financial Technology (FinTech) can culminate in new frontiers of industrial revolution and obliterate complacency and bureaucracy that is costing trillions of dollars the world economy. Companies and organisations alike all over are experiencing business lulls due to the rampant politics and bureaucracy that is sapping the energy and vitality of the corporations. Organisation evangelists (entrepreneurs) are required to battle the complex web of bureaucracy within the economy. Thus, corporate entrepreneurship is a boon to the economy in all spheres of life.
To sum up, it is increasingly becoming difficult for managers to run their organisations in an era where they are bombarded by challenges every day and that the managers who avoid the upcoming challenges are bound to fail in the long-run. "Nowadays" as Philip Kotler puts it, "we need to run faster to remain in the same place".
(The author is an M.Phil in Management from Purbanchal University School of Management.)