ABUSMAA1 Module #1 PDF

ABUSMAA1 MODULE #1 August 16, 2024 Ar. Anthony M. Pla, uap, rmp Agenda § Introduction § Elements of Business Management § Theories § Concepts § Function § Principles 8/29/24 Annual Review 2 Introduction 7 Key Elements of Effective Business Management Wh...

ABUSMAA1 MODULE #1 August 16, 2024 Ar. Anthony M. Pla, uap, rmp Agenda § Introduction § Elements of Business Management § Theories § Concepts § Function § Principles 8/29/24 Annual Review 2 Introduction 7 Key Elements of Effective Business Management When it comes to running a successful business, there are many different aspects that need to be considered. These include everything from marketing and finance to human resources and operations. However, no matter how good your company is at managing its people or balancing budgets, if you don’t have an effective strategy it won’t matter how well-run everything else is. That’s why we’re going to take a look at the seven important elements of business management and discuss how each one can contribute to better business. 8/29/24 Annual Review 3  7 KEY ELEMENTS STRATEGY § FinanOper. It outlines how you’re going to achieve what you want to achieve and it’s based on the business environment, mission and goals. § Strategic planning is crucial for any company that wants to stay ahead of the curve in today’s competitive marketplace. It’s about making decisions about where you want your business to go, and when and how it will get there. It helps you focus on what’s important so that you can make sure everything else is aligned with those priorities. § Effective strategic planners are important elements of business management because, they: Understand the competitive landscape in which your business operates Identify potential opportunities and threats that may affect your company’s success Create a detailed plan for achieving the strategic objectives 8/29/24 Annual Review 4  7 KEY ELEMENTS MARKETING § Marketing is another aspect of important elements of business management. It is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. § Having an A-team of marketers will: Help you drive long-term growth and profitability Increase your brand awareness and loyalty among consumers Make your company more competitive in the market by increasing revenue, lowering costs and reducing risks § Marketing and business management go hand in hand. Your marketing team should be able to set clear goals and objectives, create strategies that align with those goals, develop effective tactics that reach your target audience 8/29/24 Annual Review 5  7 KEY ELEMENTS FINANCE § It’s important to note that financial management is essential for the health of your business. A financially sound company can survive and thrive, while a financially unstable company will struggle to stay afloat. § Financial management is the process of managing and controlling your company’s money. It includes budgeting, forecasting, financial analysis, cash flow management, risk management and reporting. Its not question that it makes the top list of important elements of business management. § Financial management is done by accountants and financial managers. Accountants provide the financial data to help companies make decisions, while financial managers use this information to manage your organization’s finances. § The value of financial specialists cannot be underestimated in business. For example, companies with strong financial management are more likely to survive during tough economic times. With the ability to plan for the future, these companies have an advantage over those that do not have a clear vision of where they are headed. 8/29/24 Annual Review 6  7 KEY ELEMENTS HUMAN RESOURCES § Human resources also makes important elements of business management list. As a business owner, you need to have the right people on board. This may include hiring them and training them. You also need to manage and motivate them if they are already on board. Another major part of human resource management is firing people or letting go of staff members who are not performing well in their jobs or jobs that don’t fit into your company’s future plans. § Having a capable workforce that comes with having human resource professionals as part of the team will help your company achieve its vision and goals faster than before because: They can help with hiring decisions based on soft skills required for each position They can provide guidance about how best candidates will fit into overall corporate culture They can advise on any legal issues related to hiring practices (for example, discrimination 8/29/24 Annual Review against certain groups). 7  7 KEY ELEMENTS TECHNOLOGY AND EQUIPMENT § Technology is a key element of business management. The role of technology in your business is almost as important as the people who are using it. You need to have the right tools, software and infrastructure for your company to operate efficiently and effectively. § The benefits that come from having IT gurus on your side include: They can help you save money by implementing cost-effective solutions for your firm’s needs (like replacing expensive legacy systems with cloud-based ones). They can help make sure that your data is stored in the most secure way possible (by implementing firewalls, monitoring servers and backups). They can also make sure that your systems are not only up-to-date but also compatible with other systems used by other organizations for CRM (Customer Relationship Management). 8/29/24 Annual Review 8  7 KEY ELEMENTS OPERATIONS § Operations is the process of carrying out your business’s day-to-day activities. This includes making sure that your employees are able to do their jobs effectively, as well as helping them with any issues or problems they may face. Operations can also include ensuring that the physical environment in which your business operates is safe and secure. § Having an effective operations teams as important elements of business management will: Help you to be more efficient in your day-to-day operations. Ensure that your employees are performing at their best and that they have everything they need to do their jobs effectively. Help prevent accidents, injuries, and health issues caused by working in an unsafe environment. 8/29/24 Annual Review 9  7 KEY ELEMENTS COMMUNICATION § Communication is a crucial component of any business, but it’s especially important to keep in mind when talking about effective management. Effective communication is a two-way street: whether you are communicating with your employees or with clients and partners, it’s important to make sure that everyone understands each other clearly. § Effective communication can mean everything from making sure that bills get paid on time to making sure that everyone on staff understands their roles within the company and how they fit into its overall mission. This kind of clear direction helps inform employees about their place within the larger structure of a company and gives them an idea of what it means for them to succeed at their jobs. § It’s also important for companies who want to expand into new markets or appeal to new audiences; when trying something new like this, there needs be steady communication between all parties involved so no one feels left out or confused about what’s going on behind closed doors. 8/29/24 Annual Review 10 Theories of Business Management Let’s dive in  Theories of Business Management Management theories are concepts surrounding recommended management strategies, which may include tools such as frameworks and guidelines that can be implemented in modern organizations. Generally, professionals will not rely solely on one management theory alone, but instead, introduce several concepts from different management theories that best suit their workforce and company culture. 8/29/24 Annual Review 12  Scientific Management Theory American mechanical engineer Frederick Taylor, who was one of the earliest management theorists, pioneered the scientific management theory. He and his associates were among the first individuals to study work performance scientifically. Taylor’s philosophy emphasized the fact that forcing people to work hard wasn’t the best way to optimize results. Instead, Taylor recommended simplifying tasks so as to increase productivity. The strategy was a bit different from how businesses were conducted beforehand. Initially, a factory executive enjoyed minimal, if any, contact with his employees. There was absolutely no way of standardizing workplace rules and the only motivation of the employees was job security. According to Taylor, money was the key incentive for working, which is why he developed the “fair day’s wages for a fair day’s work” concept. Since then, the scientific management theory has been practiced worldwide. The resulting collaboration between employees and employers evolved into the teamwork that people now enjoy. 8/29/24 Annual Review 13  Contingency Management Theory The main concept behind the contingency management theory is that no one management approach suits every organization. There are several external and internal factors that will ultimately affect the chosen management approach. The contingency theory identifies three variables that are likely to influence an organization’s structure: the size of an organization, technology being employed, and style of leadership. Fred Fiedler is the theorist behind the contingency management theory. Fiedler proposed that the traits of a leader were directly related to how effectively he led. According to Fiedler’s theory, there’s a set of leadership traits handy for every kind of situation. It means that a leader must be flexible enough to adapt to the changing environment. The contingency management theory can be summed up as follows: There is no one specific technique for managing an organization. A leader should be quick to identify the particular management style suitable for a particular situation. The primary component of Fiedler’s contingency theory is LPC – the least preferred co-worker scale. LPC is used to assess how well oriented a manager is. 8/29/24 Annual Review 14 Concepts of Business Management The 4 P’s of Business Management  Concepts of Business Management 8/29/24 Annual Review 16  The 4P’s of Business Management Management is the art of managing, controlling, leading and taking decisions. Management is present everywhere. Management is present from corporates handling billions of dollars to home run small business units, from the field of sports and entertainment to politics and social issues. The art of management is dynamic, and there exists no specific formula for success. But there are a few ways which can lead to positive results. We have always heard about the 4 Ps of marketing but in todays competitive world we need the new 4 Ps. 8/29/24 Annual Review 17  The 4P’s of Business Management Planning is the first factor, which forms the backbone of any exercise. No matter how gigantic or minute a task or crisis is, until and unless there is a plan available, it is bound to lead to a disorder. Planning ensures preparation for any event, optimum utilization of resources and managing time for the best possible consequences. 8/29/24 Annual Review 18  The 4P’s of Business Management Priority is the second pillar for successful management. Until and unless organizations and individuals have their priorities cut into place, it would always result into exploitation of resources and uncertainty of activities. All financial resources, human resources planning, activities should be prioritized so that the tasks which requires urgent attention must be performed before hand and others can be performed subsequently. Thus, any professional or business organization must have their priorities straight. 8/29/24 Annual Review 19  The 4P’s of Business Management Perspective forms the third main stay of management. Every situation must be analyzed, evaluated and studied for every perspective, and individuals and companies must be prepared for all possibilities. No matter how successful a company or how popular a brand is, they must always consider all scenarios, and be prepared for the worse. Another important view is to understand the perspective of the employees within your own organization if they fail, and support them rather than blaming the failure on them. Therefore, having an absolute perspective is fundamental for companies. 8/29/24 Annual Review 20  The 4P’s of Business Management Patience - the last but the most important pillar for succeeding is Patience. Any individual, organization or company can never succeed if it does not have the patience to do so. Rash, impulsive and spontaneous decisions may benefit organizations in the short run, but it will hamper their growth and credibility in the long run. To get results, companies must put in maximum effort, for which sky is the limit, but must be patient so as to reap the benefits of success. 8/29/24 Annual Review 21 Primary Functions of Business Management Let’s dive in  Functions of Business Management We have defined management as a process to achieve organizational goals. A process is a set of activities that are ongoing and interrelated. Ongoing means that the activities are not done in a linear, step-by-step fashion where responsibility is passed from one activity to the next. Instead, the activities are continued as new activities are started. Interrelated means that the results of each activity influence the other activities and tasks. It is the responsibility of management to see that essential activities are done efficiently (in the best possible way) and effectively (doing the right thing). 8/29/24 Annual Review 23  Functions of Business Management The management process consists of four primary functions that managers must perform: planning, organizing, leading, and controlling. It is important to realize that the management process is not always linear. It does not always start with planning and continue through each step until organizational goals are achieved because it is not possible to plan for every problem the organization will face. As the management process proceeds, changes and modifications are made when unforeseen events arise. Managers make sure the necessary changes are implemented and that the unity and integrity of the entire process is maintained. 8/29/24 Annual Review 24  Functions of Business Management The key functions in the management process are connected, but not always linear. 8/29/24 Annual Review 25  Planning Planning means defining performance goals for the organization and determining what actions and resources are needed to achieve the goals. Through planning, management defines what the future of the organization should be and how to get there. Strategic plans are long-term and affect the entire organization. A strategic plan bridges the gap between what an organization is and what it will become. Tactical plans translate strategic plans into specific actions that need to be implemented by departments throughout the organization. The tactical plan defines what has to be done, who will do it, and the resources needed to do it. 8/29/24 Annual Review 26  Planning For instance, recall the example used at the beginning of this module. It described how ThyssenKrupp AG decided to become an elevator manufacturing and servicing company because of increased competition from Chinese steel. The management of the company set a goal of deriving the majority of its revenue from elevator-related activities. To do this, the management team made plans to create partnerships or take over existing elevator companies. The team devised plans to develop new human resources and to acquire other material resources. The company also had to divest existing steel-related resources to raise capital for the new initiative. This example is a long-term strategic plan that will take years to complete and require many changes along the way. But it starts by defining a goal and a preliminary path to achieve it. 8/29/24 Annual Review 27  Organizing Once plans are made, decisions must be made about how to best implement the plans. The organizing function involves deciding how the organization will be structured (by departments, matrix teams, job responsibilities, etc.). Organizing involves assigning authority and responsibility to various departments, allocating resources across the organization, and defining how the activities of groups and individuals will be coordinated. 8/29/24 Annual Review 28  Organizing In the case of ThyssenKrupp AG, the management had to determine how to support two very different sets of activities if it were to achieve its long-term goal. Management needed to continue steel production activities to provide continuity of funds as the emphasis gradually shifted to elevator production. It also had to develop new skills and resources to build the company’s elevator capabilities. A new organizational structure was needed that could support both business activities as one was downsized and the other built up. 8/29/24 Annual Review 29  Leading Nearly everything that is accomplished in an organization is done by people. The best planning and organizing will not be effective if the people in the organization are not willing to support the plan. Leaders use knowledge, character, and charisma to generate enthusiasm and inspire effort to achieve goals. Managers must also lead by communicating goals throughout the organization, by building commitment to a common vision, by creating shared values and culture, and by encouraging high performance. Managers can use the power of reward and punishment to make people support plans and goals. Leaders inspire people to support plans, creating belief and commitment. Leadership and management skills are not the same, but they can and8/29/24 do appear in the most effective people. Annual Review 30  Leading It is very difficult to motivate people when plans involve radical change, particularly if they include downsizing and layoffs. Many people are naturally resistant to change. When the change means loss of jobs or status, people will be very resistant. At ThyssenKrupp, the labor unions vehemently opposed the shift from steel production to elevator manufacturing. Although the people involved in the new business functions were excited by the plans, people involved with steel production felt abandoned and demotivated. Management would have been wise to get union support for its vision of the company’s new future. 8/29/24 Annual Review 31  Controlling There is a well-known military saying that says no battle plan survives contact with the enemy. This implies that planning is necessary for making preparations, but when it’s time to implement the plan, everything will not go as planned. Unexpected things will happen. Observing and responding to what actually happens is called controlling. Controlling is the process of monitoring activities, measuring performance, comparing results to objectives, and making modifications and corrections when needed. This is often described as a feedback loop, as shown in the illustration of a product design feedback loop. 8/29/24 Annual Review 32  Controlling Controlling may be the most important of the four management functions. It provides the information that keeps the corporate goal on track. By controlling their organizations, managers keep informed of what is happening; what is working and what isn’t; and what needs to be continued, improved, or changed. ThyssenKrupp had little experience in elevator manufacturing when it was making plans. It was developing new products and processes and entering new markets. The management knew it could not anticipate all the difficulties it would encounter. Close monitoring as the plan progressed allowed the company to make changes and state-of-the-art innovations that have resulted in a very successful transition. 8/29/24 Annual Review 33 5 Principles in Starting a Business Let’s dive in  5 Principles in Starting a Business 1. Always Have a Clear Business Strategy Not all businesses have a clear business strategy, which will expose its weaknesses for a variety of reasons. Implementing proper strategies will help assess current and future risks and produce ways in which they can be avoided. Core business strategies can be broken down into three different categories: 1. General Strategy – A general strategy refers to how a given objective will be achieved. An objective can be anything from making a specific amount of money in profit to acquiring X amount of new loyal customers before a given date. Once an objective is properly identified, the tactics used to reach that objective are considered the “how”; thus, are what make up the general strategy. 2. Corporate Strategy – A corporate strategy refers to the choices and commitments made regarding markets, business and the nature of the company itself. A corporate strategy clearly outlines the choices and commitments one will make to execute their business strategy successfully. 3. Competitive Strategy – A competitive strategy refers to business competitors and the nature of competition itself. A competitive strategy identifies competitors, the cost of leadership, the business’ focuses and differentiation. A good competitive strategy creates a long-term plan that will allow a business to gain a competitive advantage over its competitors. Also, a sound competitive strategy will ensure the business will keep its market share during tough times while positioning itself to gain ground within the marketplace as competition struggles to adjust. 8/29/24 Annual Review 35  5 Principles in Starting a Business 2. Understand the Industry Before jumping into an industry, one must ensure they completely understand that industry inside and out. The more that is known about an industry, the easier it will be to create excellent business strategies. It becomes easier to identify what is missing from an industry. In addition, a businessperson who understands their business’ industry will find marketing much easier. Marketing requires one to be fluent in not only the economic or technological trends of an industry but the psychology of its consumers as well. Consumer behavior is a core element to any business industry, as, without a consumer, there is simply no business. Those who understand how their customers shop and how their customers think are able to market their business successfully more often than those who do not. Understanding an industry may even result in one choosing to leave it. There is a countless amount of industries that flourished in the 1900s but cease to exist today. Technology has advanced quicker in this life-time than any other, and those leading the technological revolution have no interest in slowing down their technological development. If it’s clear an industry will quickly become obsolete, those considering to enter it will likely reconsider. 8/29/24 Annual Review 36  5 Principles in Starting a Business 3. Always Try to Focus on What Makes the Business Unique While it can definitely be easy for one to become fixated on how their business is ranked in terms of performance, focusing on what makes a business unique from its competitors should never be forgotten. Markets can become quickly saturated with any specific product or service, and it typically leads to businesses that fail to differentiate from one another fighting for survival. The best way to ensure a business comes out on top in a competitive market is to prove to consumers they won’t find such a product or service from anyone else. Focusing on what makes a business unique goes hand in hand with understanding the industry itself. It’s crucial for a businessperson to understand their industry in order to successfully identify what that industry is missing. Businesses that offer unique products or services that an industry lacks are more likely to be remembered as one that revolutionized the industry. The worst thing one could do is copy everything their competitor is doing. Peeking at competitors and how they operate is a great way to get started with a business, but a great business person focuses on what they can do better and what their business has that their competitor’s business does not. The attention span of a consumer is short, and businesses will have to offer something new if they are to remain relevant. 8/29/24 Annual Review 37  5 Principles in Starting a Business 4. It’s Okay to Say “No” The business world is a fast-paced one that can be challenging to keep up with. It’s easy to understand why an entrepreneur starting a new business would turn to their competitors and even other successful businesses not directly related to theirs for guidance. Understanding when to say “no” is key to building a successful business. Trends quickly come and go, and businesses must choose whether or not they can successfully profit during its lifecycle. While it may seem like every business around is participating in a particular trend, sometimes it’s okay to sit that one out. 8/29/24 Annual Review 38  5 Principles in Starting a Business 5. Reach Out for Help It’s almost impossible for one person to build a successful brand all by themselves. Businesses are a team effort, and the most successful businesses reach out to others for products and services they cannot create themselves. Whether it would be purchasing materials necessary for production, commissioning a web designer for a great branded website, or seeking consultation services to better market their business, reaching out for help is one of the most important things any business person could do. 8/29/24 Annual Review 39 Principles of Business Management 14 Business Principles  14 Principles of Business Management 1. Division of Work 8. Degree of Centralization 2. Authority and Responsibility 9. Scalar Chain 3. Discipline 10. Material and Social Order 4. Unity of Command 11. Equity 5. Unity of Direction 12. Stability of Tenure 6. Subordination of Individual Interest 13. Initiative 7. Remuneration 14. Esprit de Corp 8/29/24 Annual Review 41  1. Division of Labor Every team member has a different profile and set of preferences. Even employees with the same university degree and work experience can differ in terms of their favorite tasks and what they’re best at. One of the primary functions of business management is assigning the right task to the right employee. That’s to say, it is your job as a leader or a manager to identify your team members’ best skills and what they enjoy, then assign them suitable tasks. 8/29/24 Annual Review 42  2. Authority and Responsibility Famous comics writer Stan Lee is known for saying “With great power comes great responsibility.” And Fayol couldn’t agree more! That’s why the latter’s second business management principle calls for carrying the responsibility of being in charge; being a leader and a manager. As you are at the top of the hierarchy, you usually are in charge of calling the shots and defining the line of action. In this case, you’re not only responsible for the quality of the process, but also the quality of the outcome! In other words, whether the plan works or not, you should take on the responsibility rather than blame a team member. Even when a worker is negligent and s/he slows or even disrupts the process, it’s still your responsibility that the process is disrupted or slowed! That’s because the first business management principle clearly states that you assign tasks! Therefore you take responsibility even for the performance of your team. 8/29/24 Annual Review 43  3. Discipline Any company that lacks a clear disciplinary system will eventually collapse. This doesn’t mean you should recite the rules every morning on your team, or have a big board at every corner as ‘The Big Brother’ would. Still, it’s very recommended that a clear statement is accessible and it can be included in a welcoming email to employees once they’re hired. The disciplinary lines should include terms of respect for one another and what the leader expects from his team VS what the team members should expect from their leader. But it shouldn’t stop at this point! Your crew should see your discipline in every action you take from day one. If they see that you’re devoted to working and treating everyone with respect and appreciation, they’d simply do the same! Principles of business management aim to maintain order. And the third principle is about respect and appreciation. In a nutshell, your team is a reflection of who you are. Discipline yourself and treat everyone as you want to be treated. Then the next thing you’d know is that you’re leading a team of disciplined professionals who do their work and respect each other. Productivity and teamwork will only peak upward after that! 8/29/24 Annual Review 44  4. Unity of Command Any company that lacks a clear disciplinary system will eventually collapse. This doesn’t mean you should recite the rules every morning on your team, or have a big board at every corner as ‘The Big Brother’ would. Still, it’s very recommended that a clear statement is accessible and it can be included in a welcoming email to employees once they’re hired. The disciplinary lines should include terms of respect for one another and what the leader expects from his team VS what the team members should expect from their leader. But it shouldn’t stop at this point! Your crew should see your discipline in every action you take from day one. If they see that you’re devoted to working and treating everyone with respect and appreciation, they’d simply do the same! Principles of business management aim to maintain order. And the third principle is about respect and appreciation. In a nutshell, your team is a reflection of who you are. Discipline yourself and treat everyone as you want to be treated. Then the next thing you’d know is that you’re leading a team of disciplined professionals who do their work and respect each other. Productivity and teamwork will only peak upward after that! 8/29/24 Annual Review 45  5. Unity of Direction It is a wrong belief that two teams having different responsibilities and goals should work separately. It was believed that, for instance, the SEO team should work separately from the writing team, and the same goes for the sales enablement team. But the unity of direction isn’t about separating teams. It’s much more about unifying the efforts of each sub-team. For instance, writers should have a clear work plan that they follow. And the plan can include interacting with the sales enablement team to write good copies about services and products and increase lead generation. And the plan can also include working closely with the SEO team to make the copies as optimal as possible. 8/29/24 Annual Review 46  6. Unity of Individual Interest Selfishness is a human trait. It’s extremely rare to find an altruist person who’d prioritize someone else’s good over his or hers. But your team should understand that tasks aren’t about themselves! It’s about the whole team and the progress of the company. As the team has a clear line of command, individual interests should be left out of the equation. Any selfish or individualistic behavior should be addressed directly and reprimanded respectfully. A team that prioritizes the common good and the company’s goals over personal ones is far more likely to strive and thrive. But isn’t it a human trait to be selfish and relatively speaking self-centered? Yes, it is! And as a manager, you can feed this human need by praising the performance and achievements of your teams and giving them all the credit for whatever they do right! Even if it's your idea and your plan, giving the credits back to the team makes you grow in their eyes and reduces the urge to be selfish. 8/29/24 Annual Review 47  7. Renumeration As an extension of the former set of principles of business management, remuneration comes to end with the problem of selfishness! Materialistic rewards should be a ritual at your company. This encourages your team’s sense of recognition and increases the hustle and competition in a friendly way. You can do that by amplifying individual achievements and tipping the employees fairly for their prime performances. But it also means there should be an official treat for instance for the top three employees of a company each month. Three can be a big number if your team is only four people, and it can be very small if you have a giant corporation with hundreds of employees! It’s, again, your job as a manager to figure out an effective way to remunerate shining stars in your company. 8/29/24 Annual Review 48  8. Degree of Centralization Centralization is more of a political theory principle rather than a business management one. In a nutshell, a centralized company is one where the management power is centered at the top. That is to say, managers and the executive board possess all the decision-making accountability, and anyone below them is a doer. On the other hand, a decentralized company unleashes its employee’s freedom to act freely and take control over project management. As the latter seems more like democracy, it may not be a platonic approach! The ideal approach, as we are doing in Vardot, is to seek moderation. Following Fayol’s principles of business management will help you (as a manager) regulate the pendulum in a perfectly balanced spot between decentralization and centralization. 8/29/24 Annual Review 49  9. Scalar Chain One of the primary functions of management is to organize the authority hierarchy of a company. That’s to say, each employee, including managers and executives, should be aware of their position in the company, and act upon it. Especially when communicating and interacting in official meetings. Fayol explains that maintaining clear hierarchical borders between the company’s entities requires making communication only open for one level up or one level down. But in this case, Fayol continues to explain, meaning would be lost on its way to the upper boards. And vice-versa, instructions as well get foggy and become confusing before they finally make their way to the low-class employees. Modern means of communication, fortunately, made it possible to communicate between all classes without affecting the prestige of a CEO or offending a new employee. Even trillion-dollar companies’ CEOs now speak to the world via these technologies! Let alone in their companies. 8/29/24 Annual Review 50  10. Material and Social Order We’ve been talking a lot about the humanistic principles of management, but little to no attention was given to the means of production! But again, means of production start with the human force itself! Material and social order is about building the right team and putting the right equipment at their disposal. A manager’s first assignment is not to build the right team! It’s rather about constructing the right working environment. This includes necessary and modern production tools and facilities. You can’t expect Einstein to observe the stars without an astronomical telescope! And accordingly, you can’t expect anyone to perform their tasks in the absence of basic requirements. Once the environment is ready, it’s high time you choose the right team members. You should analyze their right skill set and type of personality to choose the ones who will function well and make the best result in the offered environment. That’s because skills can be developed and improved quickly, but a bad person may never change in a lifetime! And you don’t want to be stuck with such a person (nor does your team). 8/29/24 Annual Review 51  11. Equity In a good company, employees should be treated equally regardless of race, gender, or religion. This includes money compensation as well as communication. If a team member feels s/he is being treated less nicely than other members or a member, not only will the person be jealous, but may also end up focusing and magnifying the issue rather than focusing on work. This may not be apparent in a one-day’s result but would certainly affect the long term. Equity in the work environment requires being a sharp communicator who can read micro-communication changes such as tone, facial expressions, and even people’s energy. 8/29/24 Annual Review 52  12. Stability of Tenure Hiring a new employee then firing him/her for low performance and replacing him/her will result in taking a long time before finding the proper force. Let alone the irreplaceable effort and time that you can do nothing but watch pass by. It’s a bad strategy to prioritize replacing hires over putting faith in them. If you choose the right candidate, give him/her enough time to adapt to the new working environment and work system before expecting fast turnarounds. When employees feel like they may get fired if they go awry, guess what? They are more likely to go awry. And vice-versa, when given faith and time, they’re expected to take on the responsibility and initiative to learn faster and overdeliver. Accordingly, make your new employee feel good about their new position rather than stressed and overwhelmed. The outcome will most of the time be better than a storm of fire-then-hire. 8/29/24 Annual Review 53  13. Initiative Gone are the days when repression was thought of as good management. Modern principles of business management pour generously into the cup of friendliness and connectivity. Your team should feel encouraged to speak and suggest plan improvements and ideas. Not only that, but they should feel welcomed and encouraged to speak. Even when a suggestion isn’t a very convenient one, the effort should still be praised and you can explain why the idea wasn’t good enough. That way, the teams will learn more about the company’s philosophy and will suggest better ideas in the future. People noticed that when working on ideas suggested by the team itself, they’re far more likely to perform better and make fast turnarounds. Employees also feel like they’re making an impact and having their legacy in the company. That’s why we highly recommend you listen and connect with your team, but cautiously to avoid breaking the boundaries we spoke about in the scalar 8/29/24 chain principle. Annual Review 54  14. Esprit de Corps The last business management principle is certainly not the least important. One reason could be the word ‘Esprit’ which is French for ‘Soul.’ That’s to say, we are talking about the soul of the whole company here! Fayol loves and invites everyone to think of a company as a living body. He perceives it as an organism that has a soul and a personality. And one of the primary missions of a manager is to keep that body active and spiritually happy. While there could be a zillion ways to do it, we recommend you always explain the why behind any mission. Make the employees know the worth and importance of their tasks. The sense of responsibility will keep them hustling even when the mission becomes daunting and tiring. Jokes and a sense of humor should also be a lifestyle in your 8/29/24 company. Annual Review 55 End Thank you 8/29/24 Annual Review 56