Business Management Framework - Essay Example

Essay on Business Management Framework Table of Contents Effectiveness of Business Management Framework in Ascertaining the Significance of Organisations and Understanding the Role of Managers 3 Bibliography 8 Effectiveness of Business Management Framework in Ascertaining the Significance of Organisations and Understanding the Role of Managers Today, organisations are created with a specific purpose. In the early days, it was thought that organisations are created solely for the purpose of reaping monetary profits but in the twenty-first century this perception has undergone sea change. Nowadays, managers acknowledge the fact that organisations play a vital role in building a society, in bridging the gap between continents and they are the chief agents responsible for constant innovation of products and services that are changing the lives of billions of people around the world. Globalisation and free trade policies have subsequently changed the ways in which today’s businesses are conducted. The motive of organisations have changed from merely being profit centers to entities which are constantly innovating their business processes to ensure better efficiency of their in-built processes and maximise customer satisfaction. The main objective of organisations is to generate customers. For this they need to identify the market forces which would help them to build customer base and subsequently devise strategies in order to tap those market opportunities. In many instances, it has been found that markets cannot sustain the growth of a particular business. In such cases, the organisations have to modify their business plans and identify markets where there is demand for their products and services. This has led to a gradual shift in the perception of managers and they have recognised the power of customers and the role played by them in building or eroding an organisation’s business prospects. Today, every business is operating to satisfy their clients and to meet their specifications, be it a manufacturing concern or a service sector. The types of products and services differ but they are all operating in their own way to render higher customer satisfaction. This is triggering innovation and leading to the development of some breakthrough products which is again attracting increased number of customers and thus a vicious cycle is being created. In this cycle, technologically advanced products and services are triggering the customers to demand for more advanced products. This in turn is again compelling the companies to continuously innovate and improve their services in order to retain their market position and to ensure rapid growth within the industry. Continuous improvement is also enabling the companies to refine their overall operations and to lower the chances of errors and under-utilisation of assets. This leads to total quality management of the different operations of a company. This in turn triggered the necessity of a Business Management (BM) framework. Ideally, the BM framework of an organisation usually takes into view three broad dimensions- the management perspective, the total quality management aspect and the IT dimension. Companies adopt tools and processes according to the particular dimension that they feel needs improvement. Previously, companies used to concentrate only on improving a particular dimension out of the listed three but gradually managers are realising the need to follow an integrated approach. Following this approach, companies are performing much better than they were once imagined to. Quality of products and services rendered by companies are setting industrial benchmarks. Innovation is the buzz word and it is the driving force behind some of the most unimaginable progress in the different fields of business. With the help of BM framework, managers of the twenty first century are able to identify the core operations that need overall improvement in order to meet the ultimate objective of generating higher customer satisfaction. It helps to integrate the different functional components of a business such as finance, marketing, human resource, operations and product design with the latest technology. These frameworks are designed according to the objectives of individual business houses and they generally differ from one company to another. However, the ultimate objective is to enhance the overall efficiency and effectiveness of the entire business. BPM (Business Process Management) can be achieved by simplifying tasks through BPR (Business Process Reengineering) or through ERP (Enterprise Resource Planning). Six sigma, MBO (Management by Objectives) and Balance Score Card techniques are being adapted rapidly by companies to build their niche in the market. This also helps the companies to strengthen their competitive edge in the market. With increasing competition and challenges within the market, the companies are relentlessly trying to make their human resource more and more productive. This has been achieved by integrating IT with the other operations of the company. The BM framework of a company helps one to understand the various strategies adopted by a company from time to time and the effects of those decisions on the business prospects of the company. It helps to identify and analyse the internal and the external forces under which a company operates on a daily basis. With the help of this framework the managers can get a holistic view of the different operations of the company and thus devise strategies to improve the overall effectiveness of the organisation. It helps managers in strategic planning and taking key decisions which would decide the future prospects of the company. Every business grows keeping in view its underlying objectives, its mission and its pre-identified values. Depending on the business needs, managers decide which operation(s) require(s) improvement. This helps them to insure that its products and services offer higher value to the end customers. Depending on the need and the current situation the organisation is going through, it deploys certain measures. If a manufacturing unit needs highly skilled workforce, then suitable training should be imparted to its workforce to avoid obsolescence of human capital. This can be understood by developing BM framework. It helps to identify the different key operations of the company and the role played by them in steering the growth of the company. Optimisation of the different business processes can be achieved with the help of this framework. BM framework helps in ensuring a continuous process and product development. This is achieved readily by adopting six sigma tools. With the help of various statistical tools and quality control processes, six sigma helps the organisation to minimise the errors in an operation. For example, with the help of this six sigma tool, , the managers in a manufacturing concern can set the permissible levels of errors in a process and can achieve them by improving all other functional processes related to production, be it supply chain network, vendor relationship or ensuring smooth flow of cash in the process. It helps in streamlining the operations by eliminating the redundancies in a process thereby increasing the speed of operation. This subsequently leads to the minimisation of idle time and lead time between processes thereby helping the companies to meet customer deadlines. This proactive approach helps managers to detect the bottlenecks of a process and adopt measures to eliminate them. With the help of this framework the company can build their niche in the market and can move into newer markets. With the help of balance score card, companies are able to measure the performance of employees. This tool helps in understanding the relation between people, processes and customers, which leads to higher financial gains. BM framework stresses the fact that it is ultimately the customers who are acting as driving forces governing the functions of an organisation and compelling the organisations to mold themselves to suit their preferences. Keeping in mind the business needs of an organisation, many models such as BPMS (Business Process Management System), Business Technology Management (BTM) and Business Driven Management Framework (BDM) are being developed. These business frameworks are implemented and modified according to the business needs of an organisation. For example, the ‘business management layer’ of the BDM framework can be broadly divided into the MBO (Management by Objectives) information model and the Service level Agreement model (SLA). The MBO model helps in decision-making thereby identifying the important factors that need to be taken into account before taking important strategic decisions. SLA model, on the other hand, helps the managers to ascertain the intrinsic factors that play a vital role in managing contracts. It helps in establishing strong service relationship between the parties of the contract. BM Framework plays a vital role for managers to gain a thorough knowledge of the various facets of a business operation. It helps them to identify the key processes that determine the smooth and profitable functioning of an organisation. Based on their deduction, they can adopt various techniques and advanced management tools that would enable them to strengthen the core operations of the company. This would not only improve their overall functioning by building stronger ties with their business partners including suppliers but would also help them to trace the market threats and opportunities. They would be able to locate where the demand of their products and services lie easily and thereafter, take appropriate measures to tap such opportunities. BM framework takes into account all the processes that play a crucial role in the successful functioning of an organisation, so it helps the managers to develop their managerial skills and become competent to steer the companies to greater heights. Continuous monitoring of the business processes can be easily done with the help of this framework. This framework helps organisations to develop themselves into strong management bodies abiding by the principles of corporate social responsibility. Therefore, it is apparent that BM framework plays a vital role in helping managers understand their organisations better and in the process makes them more competent. Bibliography Abi I., et.al., October 2004, A Business Driven Management Framework for Utility Computing Environments, Hewlett Packard Development Company, L.P.,[Online], Available: http://www.hpl.hp.com/techreports/2004/HPL-2004-171.pdf, [7th May 2009] Business Management Framework for the New Group, November 2004, Mitsubishi Tokyo Financial Group, Inc., UFG Holdings, Inc., [Online], Available: http://www.mufg.jp/english/pressrelease/2004-mtfg/pdffile/041129e.pdf , [7th May 2009] Hiles A., 2005, Business Continuity Management Framework, Rothstein Associates, Incorporated, ISBN 1931332339, 9781931332330 Shaw G. L., Business Crisis and Continuity Management, The George Washington University, [Online], Available: http://www.gwu.edu/~icdrm/publications/ShawTextbook011105.pdf, [7th May 2009] The Culture and Management Framework for Business Agility, 2003, National Computing Centre, ISBN 0850128889, 9780850128888 Read More