The Need for New Approaches to Managing People - Essay Example

MANAGEMENT OF PEOPLE 2006 Introduction A manager's most significant and most complicated job is to manage people (Aguilar, 2002). People must lead, motivate, inspire, and encourage them. At times a person will have to hire, fire, and discipline or evaluate employees. People Management is the key to success in any project. A team can make or break the project. Effective Project Managers must have strong organizational skills. Managers must motivate others to work on low-grade work; managers must energize them to work harder and put more effort into the work; managers should inspire others to invent new things; managers should build job satisfaction for others and help them reach self-actualization. Management is a serious task (Aguilar, 2002). Low team morale is a hindrance to success in any project and it is the Manager's responsibility not only to make sure that the project is successful, but also see that the team is satisfied. People work in projects to make something for people. The problems in projects are human problems. For every technical, financial or schedule problem there is a human problem behind it. The most significant resource any business has is its people. A significant element in managing a complicated project knows how to manage the most precious asset the human resources. Perhaps the greatest challenge that is presented by a global project is the management of the human resource pools. This is true at a macro or overall staffing levels and micro or delegation of work to labour pools level. Management is now assuming a greater role to strategic business partners (Holsapple and Joshi. 2000). Successful businesses realize that true competitive advantage lies in the people. Businesses have been forced to redefine the responsibilities and develop a compelling response for critics who dispute human resource's value to the bottom-line. Evolving Organisations and the need for new approaches to managing people Management has been around since the dawn of civilization (Terry, 1960). In primitive societies almost everybody had to do physical labour. To break away from this burden, about the only choices were going into politics (kings) or religion (priests). Complications arise in tracing the history of management. Others see it by definition as a late modern in the sense of late modernity conceptualization (Ahmed, Lim, and Zairi. 1999). On those terms it cannot have a pre-modern history, only harbingers. Others, on the other hand, detect management-like activities in the pre-modern past. Civilized urban societies led to more specialization, produced new vocational alternatives to manual labour, and saw a tendency of those who did not work with the hands to look down on those who did. Others argue modern management as a discipline started as an off-shoot of economics in the 19th century (Drucker. 1988). Economists provided a theoretical background to resource allocation, production, and pricing issues (Conceicao, Gibson, Heitor, and Shariq. 1997). About the same time, innovators produced elements of technical production such as standardization, quality-control procedures, cost-accounting, interchange ability of parts, and work-planning. Many of these aspects of management existed in the ante-bellum (pre-1861) US slave-based economy. There, 4 million people were, as the contemporary usages had it, managed in profitable quasi-mass production. By the late 19th century, a new layer of complexity is introduced to the theoretical underpinnings of management (Bennis, 1989). The first tertiary-level course in management in 1881 is offered. Management of People provides managers and human resource professionals with skills and knowledge for managing the people aspects of strategic implementation (McWilliams, Abagail, and Siegel 1999). In the early 21st century, it was easy to see the development of a "third wave" in these well-established concepts (Stacey, 1992). Just as the 21st century has seen new types of organizations and new ways of doing business arise, so, too, will there be new management trends, ideas, and techniques. While running after every trendy idea is hardly a recommendable strategy, the wise manager will learn, study, and apply the best current thinking. In the 21st century we find it increasingly complex to subdivide management into functional categories in this way. More and more processes concurrently involve numerous categories. Instead, people tend to think in terms of the variety of processes, tasks, and objects subject to management. Branches of management theory also exist relating to nonprofits and to government: such as public administration, public management, and educational management (Allee, 2000). Starbucks Company Background Starbucks commenced in 1971 when three academics English teacher Jerry Baldwin, history teacher Zev Siegel, and writer Gordon Bowker opened a store called Starbucks Coffee, Tea, and Spice in the touristy Pikes Place Market in Seattle. The three partners shared a love of fine coffees and exotic teas and believed they could build a clientele in Seattle much like that which had already emerged in the San Francisco Bay area. Each invested $1,350 and borrowed another $5,000 from a bank to open the Pikes Place store. Baldwin, Siegel, and Bowker chose the name Starbucks in honour of Starbuck, the coffee-loving first mate in Herman Melville's Moby Dick, and for the reason that they thought the name evoked the romance of the high seas and the seafaring tradition of the early coffee traders. The Starbucks is one of the most triumphant and admired businesses in the present day. It has developed from a single coffee shop in Seattle 33 years ago to a $4.1 billion international company. Starbucks is considered as one of the most successful and admired companies today, Starbucks has grown from a single store in Seattle 33 years ago to 5,945 outlets in United States and 2,392 more in 28 countries. In fiscal 2003, the company posted revenues of $4.1 billion. The Starbucks brand was known as one of the best recognized and most potent brand names worldwide and the company had strongly established itself as the dominant retailer, roaster, and brand of specialty coffee in UK. Starbucks has changed the way people from diverse continents drink coffee. More amazingly, the company effectively transformed a pedestrian commodity into a high-end accessory. It has created a Starbucks lifestyle that more people continue to embrace in UK and other countries. From tasty beverages to proprietary whole bean coffee blends to strategic relationships, small businesses have so much to learn from Starbucks. Starbucks' application of Leadership and Motivation Theory Leadership as organizationally and narrowly is defined as the ability of an individual to influence, motivate, and enable others to contribute toward the effectiveness and success of the organizations of which they are members (Warneka, 2006). Starbucks has the remarkable leadership ability to control its business. Starbucks successfully adopted Two Factor Theory of Herzberg. The Two Factor Theory comprises of factors whose presence prevent dissatisfaction but do not provide long-term satisfaction and factors which will continue to provide motivation because of job satisfaction. This theory also involve successful company policy, relations with supervisors, working conditions, remuneration, relationships with peers & subordinates, status, promotion, job security, sense of achievement, recognition, work itself, responsibility, and personal growth. The Starbucks' managers had been involved in successful strategies that put the company where it is now thru the help the employees. Starbucks made sure that it offers factors such as remuneration, insurance and most especially health benefits which will continue to provide motivation to the employees. Leadership can have a formal aspect as in most political or business leadership or an informal one as in most friendships (Zaleznik, 1977). Speaking of leadership the abstract term rather than of leading the action usually implies that the entities doing the leading have some leadership skills or competencies (Kouzes, and Posner, 2002). Effective leadership must be carefully balanced with empowerment, meaning that a representative cross-section of all stakeholders must be actively involved in planning and implementing the change (Heifetz. 1994). Engaging everyone in the change process enhances the likelihood of success in two ways (Kevin Joyce. 2005). First, empowerment results in broach support for the change process people will support a plan which they had a role in creating (Kevin Joyce. 2005). Second, diversity of perspective is proven to increase a group's ability to generate more good ideas and to solve problems (Kevin Joyce. 2005). Starbucks is a company that started small, dreamed big and grew to be a gigantic global corporation. Motivation is what makes the people comprising Starbucks kept going. Starbucks is a remarkable success for the reason that it capitalized on a concept that hadn't existed before the coffeehouse as a gathering place. It is not just a place to get a cup of gourmet coffee, but it has developed into a centre for socializing and intellectual discussion, mainly among students and young urban professionals. What people need is a sustainable approach to maintain enthusiasm and commitment from the employee (Deci and Ryan. 1985). This is not easy; but it is essential to the effectiveness. At lower levels of Maslow's hierarchy of needs, such as Physiological needs, money is a motivator; however it tends to have a motivating effect on staff that lasts only for a short period (Bentham. 1789). This will comprise how the employee gets motivated to serve willingly and efficiently the customers because of what they earned from Starbucks. At higher levels of the hierarchy, praise, respect, recognition, empowerment and a sense of belonging are far more powerful motivators than money, as both Abraham Maslow and Douglas McGregor's Theory X and theory Y have demonstrated vividly. Motivated employees always look for better ways to do a job (Argyris, 1976). Starbucks produced a distinctive offering that was relevant and differentiated. It turned a common and humble product into an extraordinary experience that customers are keen to embrace. Under Equity Theory by Adams employees compare their reward in relation to their input with others and perceive they are equitably rewarded, relatively under rewarded or over-rewarded. Fairness can be considered from two points of view: Distributive justice or the perceived fairness of the outcome; and Procedural justice, fairness of how the rewards are allocated or decisions made. As the business continued to grow, resulting in a large and geographically scattered workforce, Starbucks applied the Equity Theory by assembling a team of people from various regions to go over employee concerns, seek solutions, and give a report at the company's Open Forums. At these Open Forums, held quarterly in every geographic region where the company did business, senior managers met with all interested workers to present updates on Starbucks' performance, answer questions, and provide workers an opportunity to air grievances. Motivated employees are more quality oriented. Motivated workers are more productive. More than the taste of its coffee, there are a number of factors that propelled Starbucks' latte to the forefront. Growth and Development of Starbucks Starbucks opened its first store in Seattle's Pike Place Market in 1971. The business started small, but even early on it always had big ambitions. The business was made public in 1982, almost a decade after it commenced. From its humble early development, the business currently holds about 40% of the specialty coffee market, and the anticipated growth in this category will offer the business considerable opportunities for further growth and expansion in the future. In reality, it can be said that Starbucks is just at its early stages to colonize the globe. Starbucks used the slow-but-sure approach to business growth. It was surely not an overnight success. But through perseverance, patience, management and financial smarts, the business developed into a formidable global presence. If Starbucks did it, then certainly other small businesses can replicate its success. Strategies of Starbucks Company's strength lies in its ability to spot opportunities, even if that means debunking accepted retail trends. Company's ability to think outside the box is a common trait that propelled other small businesses to the big league. Starbucks has well established this behaviour in the approach to real estate, which in itself is legendary. Contrary to established tenets of retailing, Starbucks does not choose a location based mainly on demographics, traffic patterns, location of competitors, and even spacing of its own stores. Instead, Starbucks clusters its stores in chosen areas, making Starbucks ubiquitous in various city streets. Traditional retailing mindset warns against locating stores nearby as it can cut sales at existing outlets. Starbucks went against the accepted norm and pursued clustering, using this strategy to raise total revenue and market share. The risk paid off its practice of blanketing an area with stores helped achieve market dominance quickly. The strategy also made it cheaper to distribute supplies and manage each store. The size of the business has enabled it to absorb any losses that would result from the cannibalizing of store sales when a new one opens up nearby. Starbucks was able to attain its objectives, break new markets, and raise its bottom-line by entering into strategic alliances with the right companies. For small business to succeed, the need to recognize that the business alone cannot fill the hole in serving the needs of the target market. The business will require the help of another entrepreneur or another company who is eager to work with the business and share financial risks. It may not be Pepsi or any Five-star Hotel, but the partner may aid the business enter new markets, and make products and services to market faster. Strategic partnerships will be the means to improve the competitiveness in the marketplace and keep pace with the fast changes of technological innovation, just like Starbucks. Starbucks has produced a retail store experience that is attractive, comfortable, and even entertaining, intended to attract customers and keep them coming back to the stores. In its stores, comfortable chairs, wireless Internet connection, even a selection of music can be found. Starbucks started offering wireless high-speed Internet access in its stores in 2001 to improve the experience for students, business travellers, and web surfers who take advantage of this service while sipping their favourite coffee. The product innovations and store ambiance that the business produced are all intended to promote an environment that would enhance and complement the customer's coffee drinking experience. The end result is a pleasurable experience for the customer a unique Starbucks experience. The victory of Starbucks is mainly due to its steadfast commitment to the customers. The company lives by its mission statement "Develop enthusiastically satisfied customers all of the time." Every strategy made by the company is planned to keep customers satisfied from the moment a customer walks into one of the retail stores, to placing of an order, to receiving a fresh cup of coffee and ultimately to the choice of relaxing in the Starbucks store or moving on with the daily routine. Starbucks try hard to ensure that no one has a bad experience in the stores. Hence, most of the strategies from opening of clusters of stores to drive-through in several areas are all intended to speed up customer line and keep away from the spectacle of impatient customers. With coffee as its major product, Starbucks continue to launch new products in order to get customers to spend more money in their stores. The company knows that customers would want something else with the coffee; hence Starbucks introduced hot sandwiches and pastries to go along with the coffee. Starbucks even enthusiastic to introduce CD burners in the stores so customers can sample online music from the Hear Music subsidiary while taking the coffee. Even the wireless Internet access that Starbucks introduced in most of its stores is a clever but indirect way to get customers to spend more and increase the stores' revenues. Customers stay longer in the stores, and actually purchase more coffee, food items and other products. In fact, Starbucks officials in interviews state that the most successful stores turn out to be the ones where customers stay the most. They welcome people staying awhile in the stores, as they then have greater opportunity to market to them the other products. Starbucks' ability to roll out new initiatives and products relatively rapidly is a substantial competitive strength for the company. Its disciplined innovation is one of the main reasons behind the company's achievement in generating consistent high level of same store sales. It continues to experiment and launch new products in the market, while ensuring that it maintains the consistent strength of its core product. Starbucks has a well-seasoned management team that continues to make winning strategies for the business. One of its best decisions hence far is its strategy of foregoing franchisees and ensuring that its stores are company-owned. This strategy permitted the business to maintain a tight grip on its image and offer a consistent quality of tremendous service. Starbucks' management is also cautious in its use of resources. It fuels expansion with internal cash flow. My Own Practice in Managing of People My experience in managing people is very limited and therefore, it is my aspiration to fulfil the academic awareness that I should gain from this research. Furthermore, I believe that detailed analyses of such fundamental case studies as the one of the Starbucks should help me in my own future actions and managerial decisions. For example, the broad knowledge of the theoretical base on motivation theories should assist me to better understand the ways of how to motivate my subordinates and to certain extent, be able to understand their attitudes and approaches towards work. The subordinates need to know where they stand, and how they are performing against the expectations. People can achieve this through a structured review system, but such systems often become banal formalities with little or no communication. The best time to give feedback is when the event occurs. Since it can impact significantly, the feedback should be honest, simple, and always constructive. The work itself should be interesting and challenging. Interesting for the reason that this makes the staff actually engage the attention; challenging for the reason that this maintains the interest and provides a sense of personal accomplishment when the job is done. Additionally, knowledge of the leadership theories should enable me to obviously understand, which leadership style is most suitable to me and the ways how it should be altered or improved in order to leverage most of it in terms of my skills and talents. In addition, it should help me to realize the leadership styles those of my superiors and act accordingly, so to be able to construct a bridge of understanding, effectiveness, efficiency, free flow of information and commitment between the upper layers of management, myself and those in my command. It is clearly significant to be good in managing people, which should embrace the theoretical knowledge as well as practical experience. Conversely, it is even more significant, not to lose contact with people for instance partake in the different managing processes taking place in the organisation, especially started by myself, so to show employees the importance of such processes and that they are concerned with everyone within the organisation. Obviously, motivation and leadership should never be ignored as discussed in the case of Starbucks. Employees should to be rewarded in accordance with their expectations as long as that is consistent with their performance and visa versa. Human resources should always stay most significant for almost any organisation, so that lack of commitment, motivation or morale of staff can place a stop sign or major struggle to almost any, even very positive and perspective change or improvement process. Despite that some of the human resources can be replaced, the tacit knowledge accumulated by the experienced staff is frequently very hard to transfer and may be lost if an employee is to leave an organisation. Generally, managing people is extremely demanding and challenging task, and it takes much more than merely good theoretical and educational background but also practical skills, experience and plainly the talent. Conclusion Managing people involves understanding the strengths and weaknesses of individuals within a work team and assigning people tasks for optimal efficiency. In fact, another way to look at these differences is to equate leadership with effectiveness and management with efficiency. Today's managers are more and more taking responsibility for nurturing and developing the people. No matter what sort of project a person are managing, the human resource side is one that requires constant attention. It is suggested that managers decide which of the types of project best fits the situation. No one knows better than managers that an organization's human capital is its most important asset. The positive impact made by a single motivated manager, an innovative thinker or a newcomer with an ambitious new project can reverberate positively within businesses of any size. On the other hand, the burden of people performing below par the hours spent correcting mistakes, the money wasted on unproductive performance, and the costs of having to recruit and train replacement staff take a powerfully negative toll on the bottom line. Reference Aguilar, O.I. (2002). The New Role of Performance Management. In Cost Management. Update, No. 132. Ahmed, K.K. Lim, and M.Zairi. (1999). 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