People Management is a feature related to the core functioning of all the firms and countries regardless of their place and domain. Effectiveness and success of an organization is also dependent over the fact that how efficiently that firm or country is able to manage people associated with its working. If company is unable to manage its people, it will become unsuccessful despite of the surplus availability of all other resources that are considered mandatory for the existence of the company. This factor is highly reliable over external conditions thus companies have to make regular environmental scanning to make sure that they alter their strategies such that they are able to create highly favorable work environment.
Management is one such aspect that is deeply related to the dynamism. There is no possible way in which an organization could adopt similar kind of strategies in different environment as it will hamper their functioning. This feature could be considered as the basic reason due to which economists are unable to make accurate predictions regarding various strategy formulations and defining profit structure related to the industry. There could be an appropriate estimation to certain extent in case there is an element of homogeneity in the organizational functioning, but it will also vary on a short term and long term basis. This could be explained with the help of MNCs as they take data from previously existing companies in new premises to make sure that their commencement goes in a pre-defined manner. Also high degree of variation in cultural aspect of places makes it difficult for management of organization to follow same strategy in an unaltered mode. This particular facet has developed its significance over time that act as the basic measure of productivity if attained by some of the organizations in different circumstances. Thus success of an organization can also be defined with the help of efficiency with which it is able to handle its people in different situations and at different places. It is also the fundamental reason that some of the companies operating in diversified streams are able to share a common people management tactic as rest of the conditions are similar in those organizations. It works most of the time, but sometimes it also seems to be a failure thus firms should take precautionary measures before making an application of the strategy that it has formulated.
Researches over this issue had been performed at different echelons that in accordance to the needs that pertain at that time. Some of the literatures have been depicted below,
- Hall and Jones in 1999 and Jones and Romer in 2009 worked over people management and different criteria that exists in different countries. They have concluded that per capita income of the nation is defined by the productivity that is contributed by the employees working in various firms of the nation. At any level productivity is measured by making comparison between input taken and output that is generated. This could be observed at any level of operation and act as one of the basic unit of organizational functioning hence can not be ignored. (Charles I. Jones, 2009)
- Abramovitz in 1956 stated that productivity at different levels can be associated with the measure of our ignorance in this context. No doubt there had been remarkable innovations and advancements, but in spite of these features there is no chances that all the difference could be violated that can be held responsible for controlling these factors in particular as it involve people management. Also results generated from this discussion were more or less based over certain assumptions that have become obsolete along with technological and managerial innovations that the world had encountered in the past few decades.
- Nancy Papalexandris and Leda Panayotopoulou in 2004 showed that line managers play crucial role in the field of people management. This research laid its focus over Greece and made sure that all the aspects that are related to their functioning business and economics of the firms as well as nations that get affected by the miniature but significant contribution made by the companies. (Nancy Papalexandris, 2004)
- Bloom and Van Reenen in 2007 described a new way of conducting surveys that had altered the way researches were conducted and efficiency of results that were obtained by them. It is based over interview based evaluation and the outcome scores are noted over a scale of 1 to 5. This preciously provides us with the management technique that would suit the organization on the basis of results obtained from the survey. (Nick Bloom, 2007)
This literature could further be diversified in nature as more data would made this research more comprehensive in nature that is one of the most important characteristic in measuring people's management efficiency as well as effectiveness that channelize operating competency of a firm. Thus, some of the other non academic literatures have also been taken into consideration to diversify the extent to which productivity in relation to the people management is reviewed.
Aims and Objectives
Prime aim of this study is to gather variety if information regarding people management and find features that not only define, but also enhance productivity of the same at country and form level. There is also an existence of productivity difference at all the levels that make people management even more difficult to handle and reduce the contribution that could have been made by the management of the organization in its functioning. Out aim is also to find a comprehensive result that could be applied over vast firms that are operating at international level regardless of the scale at which they are working.
This study will also be able to enlighten the management practices that are best suitable and which are least suitable according to a priority order that has been set. There are no constraints over management style that should be adopted by the management of the firm to make sure that it is able to carry out its procedures. Thus this study will help us in exploring numerous strategies that will be helpful in some of the situations, but can not be applied in all circumstances with high certainty.
This section of the research define the techniques that are being followed through the process to make sure that all the steps are carried out in an organized way without any discrepancy in its way. At an initial stage an interview would be conducted to collect data regarding the further proceeds that will enable us to evaluate performance of the firms on the basis of certain parameters that can be considered as mandatory for their functioning at some level or the other. As all further findings would rely over this aspect thus this step should be carried out in an appropriate manner otherwise it may distort further results. Evaluation process will entirely be based over three important features, i.e.
- Continuous monitoring of the company's functioning's such that all the improvements and decrements could be taken into account by the research team.
- Targets associated with the company to keep a track of the company's activities and make sure that it does not get deviated from its final objectives.
- Incentives that an organization provide to its employees to maintain minimum possible level of employee satisfaction along with retention of apposite talent within the organizational premises as it increase the pace of work.
Interviews were carried out by the MBA people as they are best suitable for this job and they also possess some degree of job experience in the field of business and training. Survey was carried out with Plant Managers to serve two main purposes, i.e. to take both seniority that signify position and regular management practices that signify retaining touch with operational activities. In this process managers are not aware of the fact that they are under review and all their answers will be taken for further analysis. This feature makes sure that there will not be any biasing in the data collection and analysis process, hence the results that will be obtained be of high significance to the companies and their management that are being reviewed. Also the help of open ended was used to make sure that different perspective could be taken into account that will ultimately help in improving productivity. All these efforts were made to identify the international patterns of management and productivity that has also proven them to be highly successful in various circumstances. It links itself with the firm's performance thus an element of economic development is also important and can not be ignored at possible step.
Some of the steps that were involved in the activity such that features like biasing could be eliminated include,
- Endorsement from government and concerned authorities were taken for different regions in which survey was conducted.
- No direct clue regarding the survey or research was given to the people and managers that were made part of the research. Instead it was positioned as 'piece of work over lean manufacturing'.
- No direct efforts were made to obtain financial data; rather emphasis was over obtaining managerial concern that makes an indirect impact over financial data which was finally obtained from other indirect and independent sources.
- Interview was more intended to lean towards effective side rather than just a formality to carry out the research. This sometimes led to more time consumption in a single interview as compared to two different interviews that could have been carried out in during that time span.
When data from different managers will get collected, there will be an analysis performed over it according to a pre-defined scoring technique. For considering nation vise management activities, US holds the top priority as it has the highest score in various practices that present in the vicinity.
Main aim of the study is to measure the effectiveness of overall management, thus an average evaluation of all the questions will be taken into consideration without giving priority to any of the particular basis, i.e. monitoring management, targets management, and incentives management. This will also help in injecting an element of fairness in the research that will not only augment its applicability, but also higher degree of acceptability by the organizations.
Data collection is one of the most important parts of the research as all the further proceedings are dependent over this particular aspect. Any ambiguity in this regard will make it difficult to make an imposition with high reliability. At an initial stage various dimensions are defined on the basis of which data is collected from different sources. Also the 5 scale scoring was defined in an individualistic manner for all the dimensions that were taken into account. They have been depicted below along with their scoring,
- Modern manufacturing techniques that are related to different aspects of manufacturing whose formal introduction have been made like JIT (just in time), support system, autonomation, flexible manpower, behavior, etc.
- Rationale associated with the introduction of modern manufacturing techniques that are able to provide with the justification that what was the root cause due to which new techniques were adopted along with their cost effectiveness and quality addition made in the organizational functioning.
- Process problem documentation, scoring technique in this case is based over identification of application of improvement methods and their timing, i.e. they are applied only when problem arises, or they are implemented to make continuous improvement in organizational conduct.
- Performance tracking, scoring of which is done on the basis of regularity of the adoption of this technique. Is performance tracking an incomplete process or it is done regular along with complete information being passed on to the employees working in the organization.
- Performance review, scoring of which takes frequency, success, and failure of the performance reviewing. It also reflects the expectation that is able to track continuous improvement that could be caused with the help of performance reviewing.
- Performance dialogue, which depicts agenda, basic reason, and follow up steps that are associated with the performance reviewing and conversation that were made during interview session.
- Consequence Management, related to the failure that can be achieved in attaining pre-defined objectives that are to be achieved. If any deviation is observed, procedures like retraining and reassignment could be adopted.
- Target Balance, scoring is based over balancing that has been maintained while setting up of the targets that are to be achieved. There should be a balance mode giving optimum priority to financial and non-financial targets.
- Target interconnection, large interconnection between different targets acts in a mutual beneficial manner. It makes use of accounting method that makes an inclusion of shareholder value, business units, and finally individual performance expectations.
- Target time horizon, whether deciding management, generally top management is concerned with the short term aspect or long term aspect of the goals that are to be achieved by the organization.
- Targets are stretching, makes it possible for the management to decide over the goal setting if previously defined goals were too easy or too hard to be attained. If it is so, any stretching could be done in this regard or not?
- Performance clarity, define measurement of performance standards and also the criteria over which they are measured are apposite or not? If they are communicated, whether they are being made public or not?
- Managing human capital, as human resource is the most important asset of the organization, thus to oversee that to what extent upper management is able to take care of its different aspects like selection, retention, and talent development.
- Rewarding high performance, to what extent is firm able to maintain equality in this regard as it helps in raising the level of integrity and combined effort towards organizational goals and also acts as basic motivating factor.
- Removing poor performers, as they become liability over the organization and measuring company's frequency to carry out this particular operation as it will determine weakness of the company.
- Promoting high performers, as it acts as a motivating factor and define competency of the company to identify its top performers in an explicit format without creating any drifts among other employees of the company.
- Attracting human capital, to not only retain, but also augment talent that organizational team comprise as external environmental conditions needs continuous improvement in organizational performance that can only be generated with the help of appropriate human capital.
- Retaining human capital, as increased competition has made it difficult for organizations to retain its talent without increasing cost to the company. Thus they need better people management approaches to make sure that they are able to retain top talent with a factor of organizational productivity.
As this research was based over finding effectiveness of different management techniques in different countries, diversified data was obtained regarding different management factors over which entire research was based. This states that cultural aspect plays an important role in defining management perspective of an organization. Combined results of all the 18 factors in different regions gave the following results, US 695, Germany 336, Sweden 270, Japan 122, Canada 344, France 312, Italy 188, great retain 762, Australia 382, Northern Ireland 92, Poland 231, Republic of Ireland 102, Portugal 140, Brazil 559, India 620, China 524, and Greece 171.
Above mentioned result could be termed as consistent as they were taken from organizations comprising of employees from 100 to 5000, which include majority of the organizations. This could be specified from the fact that median of the employed individuals in a privately owned organization is 350 that are associated with two production plants. U.S is the leader in the field of overall management scores. While in an individualistic consideration, Sweden holds top and India hold last position in case of monitoring management, Germany hold top and China hold last position in case of target management, Us hold top and Greece hold last position in case of incentives management.
There is a close relation between firm's performance and quality of the management. This will further be elaborated with the help of scores that have been obtained. Management scoring also associates features like productivity, growth rates, market value, profitability, and survival rates of the organization that in a combined format help organization achieve its objectives. This research also brings into consideration that better managed firms are larger in size as they are more stable and are more resistible towards volatile market conditions. This is because of the fact that larger firms have better sales in the market to cover up their losses in adverse scenario. Also they provide standard incentives to the employees and have sufficient resources to carry out its processes.
When a deep analysis of the obtained scores was made, it was obtained that main cause of the difference that is observed in the technique of management is level of competition present in the market. It is this factor that affects penetration rate of the companies in their respective market and impose an obligation wherever necessary to make sure that best possible combination of management practices is followed to attain better productivity as compared to previous time periods. Researches have also shown that competitive product markets have helped in developing management of the organizations beyond certain demarcations, which otherwise would not have been possible. Its scope could be further widened to the ownership of meritocratic selection of the CEOs that can be held responsible for majority of operations of the organization in both short term and long term basis.
Finally foreign organizations can be kept in the category of better managed as compared to the domestic organizations as initial have better exposure to the market and wider diversity of conditions. There might be exceptions, but in most of the cases, pattern from collected data have rectified this result.
Following are the findings that have been found by the review and analysis of different management styles and tactics that we have conducted,
- Firms that have better management practices in a comparative manner are more likely to show better performance in context to their regular and strategic point of view. Also some of the facets linked to the survival aspects of the company like growth rate, dimension of operation, etc are dependent over this particular factor in a positive manner.
- Management practices are an element of high variance and are entirely dependent over external parameters. This could be explained with the help of an example, i.e. large number of badly managed companies tend to reduce the overall management score, thus US hold top position as it contain very low number of organizations that are weakly managed.
- There are a certain types of techniques that can be considered as standard for the countries and firms, which are sometimes also known as their specialization. As for an example, Germany supersedes US in the field of targets management, while reverse is the case when incentives management is taken into account.
- Management practices are also hampered by the fierceness in the market competition. Higher the intensity of market competition, higher will be the expectation from industries operating in the same domain to meet the raised expectations of the people. This imposes a pressure over weak management organizations to make an improvement if they are willing to retain their identity in the market.
- Multinational Companies are more liable to maintain different but competent management style in accordance to the requirements possessed by the environmental conditions. There is a high possibility that they will not be able to apply similar strategy in different scenarios thus some of the US originated companies operating in UK have better incentive management rather than monitoring management as compared to Sweden originated companies operating in UK.
- When an analysis between organizations working in different domains are encountered, it has been observed that companies involved in the exporting segment of the industry are managed in a better way as compared to domestic companies not involved in export activities. But they are kept below MNCs in context of management productivity because of their weak structuring than MNCs.
- On a general basis inherited family owned firms that appoint their CEOs from their family are quite badly managed as compared to other firms. This is due to the fact that despite of having an option to appoint highly capable manager to carry out operations, they are bound to choose from defined vicinity and limited available options.
- Government owned organizations are quite badly managed as compared to other private equity companies or companies with publically quoted shares. This is due to the fact that government organizations lack proper structuring that makes them highly inevitable to fall prey to adverse situations and expose their improper management. Also there is no suitable and regular supervision in this particular case.
- Companies that are involved in making proper use of their human capital are able to follow better management practices as compared to other firms not giving required attention to this issue. This can be backed up from the fact that intensified human resource usage means employing highly educated workers that automatically increases the level of work performed by the organization.
- When analyzed at country echelon, light touch with labor market regulations are required to make sure that optimum use of management by incentives could be done to augment productivity of management.
People management is a key aspect for organizations if they are willing to achieve certain minimum level of supremacy in the market amongst their competitors. This can not be done if all the progress is done in a particular domain, thus an organization should take care of all the domains that are concerned with its functioning like monitoring management, targets management, and incentives management. Combination of all the management along with proper weight-age makes it possible for organizations to achieve high productivity with overall management. Management practices vary in accordance to the nation in which they are being implied thus multinational companies have to take special care of the fact they have to make regular alterations in their strategies to maintain proper synchronization with the external environmental conditions. As for an example, success of a company initiated in UK and willing to expand its business in Australia will have to take number of factors into consideration before it actually starts its operations in Australia. If these factors are not handled and observed keenly, it may become fatal for the organization.
- Jones, Charles I., Romer, Paul M. (2009) The New Kaldor Facts: Ideas, Institutions, Population, and Human Capital. [Online] Available from: http://www.stanford.edu/~chadj/Kaldor200.pdf
- Papalexandris, Nancy, Panayotopoulou, Leda (2004) Exploring the partnership between line managers and HRM in Greece. [Online] Emerald Publishing. Available from http://www.emeraldinsight.com/Insight/ViewContentServlet;jsessionid=F1F0083A0FEEC314051D55508BD10413?Filename=Published/EmeraldFullTextArticle/Pdf/0030290402.pdf
- Bloom, Nick, Reenen, John Van (2007) Measuring Practices Across Firms and Countries. [Online] Available from http://cep.lse.ac.uk/pubs/download/dp0716.pdf