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In a high population place like Hong Kong, we're so close to our workmates everyday and we're in a highly complex situation. I totally agree with Bolman and Deal. They argued that complex organizations can frustrate and exploit people. They believe the best and bright leaders maneuver or meander their way to apex of enterprises great and small and they really do dumb things. They stated that "If we can believe mission statements and public pronouncements, every company these days aims to nurture its employees and delight its consumers. But many miss the mark." They also pointed out that Feinberg and Tarrant (1995) agreed smart people act stupid because of personality flaws-things like pride, arrogance, and unconscious desires to fail.
Bolman and Deal declared that the managers and leaders should have the big picture for the company overall. Since managers couldn't solve problems, they would hire consultants whose specialties were in strategy, technology, finance, marketing, mergers, human resource management, executive search, coaching etc. These challenges are the complex situations leaders have to come across.
Environmentally, leaders face changes every day from outside world such as the financial economies, the rapidly growing technology and the political situation of the company's location.
Culturally inside the company, leaders also need to solve problems in their daily work post such as abuse in the workplace, theft, disrespect and poor performance etc...
Many leaders are powerless in these situations if they don't have proper tools. Managing change is a very important perspective of any effort to improve organizational performance. This is an essential value of effective leadership must develop.
Leadership Development may be just what mangers need to help the whole company progress to the next level. Leaders should manage conflicts using a collaborative style, and create an environment where members enjoy a positive, growing experience while they work to attain team goals. Leaders help employees to understand the value of their individual contributions to the organization and its overall effectiveness. Theoretically, a "complex situation" is defined as "A situation where a manager and/or a leader is/are having difficulty ending the war within themselves and employees"
Most business people think they communicate well, however, even the best communicators can have their communication skills undermined when they get wrong-footed, face potential humiliation, feel misunderstood or get really surprised by someone else's behavior. An open discussion manages conflict sometimes. Managers using a collaborative approach, and create an environment where members enjoy a positive, growing experience while they work to attain group goals.
That's when it all seems to fall apart and people regress to all kinds of inappropriate and unhelpful behavior.
Many Leaders, without proper tools, are powerless in these situations. For example, abuse in the workplace, poor performance and employees' dishonesty, theft, disrespect and blame, etc...
Leaders should have best practices to prevent difficult cases from turning into complex cases while providing a positive learning experience for all concerned. A good leader will use an assessment to assists a manager to determine what the real issues and goals are in these situations and to determine the causes of these issues in order to ' rescue' and create an action plan for solution.
Researches indicate that employees who clearly see the effects of their work have higher morale and are more motivated to perform at their best. We can see change management as an easy process that starts with an understanding of the need for dealing with change, as well as the motivation for causing positive change.
Good leaders help teams perform better while satisfying individual needs at the same time. Through effective team-building activities, goals and norms become clearer and team members become better at confronting difficulties and understanding the roles of their teammates.
Bolman and Deal pointed out those human resource theorists maintain that constructive personal responses are possible even in highly politicized situations. They gave an example of Argyris (1962), for emphasizes the importance of "interpersonal competence" as a basic managerial skill. Managers' effectiveness is often impaired because they over-control, ignore feelings, and are blind to their impact on others.
In 1952, C. A. Gibb concluded an extensive survey of research
into the subject by stating that "any comprehensive theory of leadership must incorporate and integrate all of the major variables which are now known to be involved, namely (1) the personality of the leader,(2)the followers with their attitudes, needs and problems,(3)the group itself...(4)the situations as determined by physical setting, nature of task etcâ€¦ No really satisfactory theoretical formulation is yet available."
Argyris and Schon (1974, 1996) carry the issue of interpersonal effectiveness a step further. They argue that individual behavior is controlled by personal theories for action-assumptions that inform and guide behavior. Theories-in-use guide what people actually do. A theory-in-use is an implicit program or set of rules that specifies how to behave.
"Theory-in-use" is the core assumption that an organization is a dangerous place where you have to look out for yourself or someone else will do you in. This assumption leads individuals to follow a predictable set of steps in their attempts to influence others.
For an example, Anne was responsible for one of two districts in the same city. Her counterpart in the other district, Harry, was twenty-five years older and had been with the company twenty years longer. He had a temper that flared quickly when someone got in his way. Anne tried to maintain a positive and professional relationship but often found Harry to be condescending and arrogant.
In one afternoon, Anne and Harry were disagreeing marketing plans politely. Mark, one of Anne's subordinates, tried to support her views, but Harry kept cutting him off. Mark angrily told Harry, "If you'd listen to anyone besides yourself, and think a little before you open your mouth, we'd make a lot more progress." Harry declared that the meeting was adjourned.
A day later, Harry phoned to demand that Anne fire Mark. He became angry and shouted, "If you want to get along in this company, you'd better fire that guy!" Anne calmly replied that Mark reported to her. Harry bet that she would regret that.
Three months later, Steve told Anne that someone's been spreading a rumor that he promoted Anne because they were having an affair. They both concluded that Harry was behind it.
In the example we can see the progression in the exchanges between Harry and Anne:
"Theory-in-use" assumes that the problem is caused by the other side. Harry seems to think that his problems are caused by Mark and Anne; Mark is insulting, and Anne protects him. Anne, for her part, blames Harry for being biased, unreasonable, and devious. This is the basic assumption at the core
The result of Model I assumptions is minimal learning, strained relationships, and deterioration in decision making. Complex organizations that operate on this model are rarely happy places.
The definition of top-down organizational structure refers to how people and processes are managed at the top and which is a vertical structure. Top leaders send out information, planning and budgets. The decision making is from the top. In vertical organizations, power always on the top, work can become very fragmented and communication is lost.
The top-down structure is very popular in management nowadays. Objectives are made by the top management. Top leaders' and manager's expectations are very clear and are communicate with all the other co-workers. To follow this approach, uncertainty is the key to failure, and those managers need to be very specific when communicating with their expectations. It is very important to be formal for this approach. Power was centralized and top leaders experienced overall control. The top managers' emotions and opinions influenced all the decisions. If those team members felt that their opinions haven't been listened to, than their opinions will be useless. It will be not effective between the team members. On the other hand, this structure may not provide employees with the tools and skills needed.
Same kind of problems caused by using the top-down structure can be observed in many companies with a traditional management style. Researches show that this kind of management structure often causes productivity reduction since the manager total control over his team. Such situations may lead to unnecessary slow down of a plan. Thus, teams members feel that their opinions do not matters and have no influence in the team.
In some situations, top-down structures will have the advantages. For example, in a retailing store, it may need a top down structure from a sales manager to a junior sales person.
There'll be fewer operations errors since there may be so many products in a store and managers only need to train some experienced staffs who can lead new salesmen to operate in their daily work. So, the manager need not much time for processing the training.
Manger can separate the low level work from the higher level sales leaders to a proper position.
Operation is more easy and if an error occurs in the output for any product (when inventory is huge), it is easy to identify the errors generated from which sales person. His or her senior have the duty and power to correct and job nature needs a lot of coordination work.
Top-down organizational structure may not be effective when the business nature is selling a service worked by a team or the company is organized by business process such as a printing company. Building a team that is assigned to solve problems and make decisions and the top down approach cannot fit in. For example, in a printing company, each team will include staffs with skills in graphic design, sales, and the major printing work. Their work is highly focused. Business process teams promote self-management by workers and produce greater job satisfaction by involvement. Skilled workers work together as a team will broaden the knowledge and skills of each individual.
Another example is the New York Times, a leader in the newspaper industry. Many years ago, American Journalism Review reported that New York Times' executive management thought that they were far from what was necessary for creation of an energetic workplace and a successful organization. Power was centralized that editors had the overall control. An editor's influenced all the decisions. There was no effective collaboration between the journalists. Co-workers were not morally motivated to do their jobs. The managing executives then realized that they needed to give more freedom to the teams and change their management style. It took quite a while to bring out bottom-up management to the newspaper. Finally, it was worth, as New York Times employees say that collaboration became much more efficient, and team members now work together more productively.
Downsizing is the planned elimination of positions or jobs and it is a form of restructuring strategy. It involves rebuilding the strength of an organization to ensure that the structure and the resources allocation match the size of human resources.
Downsizing had commonly been used and will be the focus in the future. In some cases, changes become necessary, but it was difficult to bring together managers to discuss in a short period. Organizations need to renew themselves if they want to survive in this everyday-changing-society, so as to compete with competitors in the industry domestically and internationally.
In recent years, some companies in Hong Kong at least have gone beyond regarding downsizing as simply a reaction to economic downturn. They now take a strategic view and accept the benefits of smaller size to become SME (Small and medium enterprises), including the opportunities for organizational reform that it offers.
Many of the reasons for downsizing arise from economic and technological changes in the business environment. The competitive pressures following deregulation and the lowering of market entry barriers have forced firms to deflate their previously oversize bureaucracies and slim down their management structures in order to reduce overhead costs and speed up decision making.
In these situations, managers are forced to reconstruct their teams to meet these challenges. So, many challenging problems come across to the situation. For example, if restructuring is limited to a particular department or team, overall performance cannot be evaluated.
There are huge communication works to do for managers. Downsizing strategy sometimes refers to the reduction of one or more hierarchical levels from the company and then transforming the decision making into a decentralized form. It is properly in both the public and private sectors.
The main goal of organizational restructuring is to achieve customer satisfaction by making the company more efficient. Reduced costs, better communication throughout the organization, and decentralized decision making are all factors in the equation to achieve better overall efficiency in the organization. All this will improve corporate performance.
If downsizing works, the organization can save much money and the costs, as well as time are reduced. Downsizing usually involves reducing costs by eliminating middle managers and their teams. In this situation, consumers can communicate with the key man, and customer satisfaction will easily be enhanced.
Efficiency is defined as the ability to do more products with the less labor input. This newfound efficiency leads to better profits, which is usually an organization's primary goal.
An organization may downsize by changing jobs or products. The organization can move its operations, to a more cost-effective location, which its potential laborers often are willing to work for less money in poor conditions.
On the other hand, employees, customers and the public will always see it's a negative side. This is because many workers will lose their jobs and this affects the society. Some failures of downsizing are that they don't have dependable leaders. The senior presidents may have little communication with the employees. Then, they'll lose their enthusiasm. Downsizing leaves more work for fewer employees, and it is not done as well. They must also find a way to deal with the bad feelings of the surviving employees, brought about by watching their friends and coworkers lose their jobs. The company will need to retrain, reskill, and adapt the working culture of the remaining employees, which could be costly. The firm must be prepared to deal with decreased productivity of the remaining employees, by as much as three to four hours a day.
Restructure costs can be associated with the excess personnel. The process starts with assessing the nature of reduction. For example, should the workers be permanently or temporarily laid-off? Middle managers and department heads are most frequently affected at this stage of downsizing, not to mention the lower employees who work under these middle and upper level managers. Next, when one or more of the hierarchical levels in the organization are eliminated, there are fewer levels for decisions to pass through the chain of command. The number of employees which upper level management must now control becomes significantly larger after a couple of layers have been terminated. If every decision were to be approved by these upper level managers, an overload would occur and the organization may become inefficient once again. In order to combat this situation, decision making is pushed downward into the organization after the first part of the downsizing is completed.
Research shows that downsizing often hurts firm performance more than it helps. This strategy is often very costly to a corporation. Some researches mentioned that more than 50 percent of companies that downsize fail to reach their financial objectives. Beyond the financial concerns, companies who choose to downsize also have to worry about employee morale, as well as public perception of the company.
The loss of workers through downsizing will have negative effect. The remaining employees must go through a process of recovery in order to regain morale. They feel guilty since their colleagues had to leave. They'll hurt when they feel they're left behind and they'll be angry if their workload has been increased.
A downsizing program should not have a psychologically negative impact on the staffs that remain. One of the problems with downsizing is that it often gives rise to "survivor syndrome" in which the remaining managers and staff experience negative effects in terms of anxiety, guilt, apathy, disengagement. And other mental and emotional states that result in poor morale, productivity loss, decline in quality and more workplace injuries. There are so many inaccurate rumors and gossips. Then, the customers and the public in general develop a negative image of the company.
For example, "Towngas" is a utility company in Hong Kong quoted on the Hang Seng index. Its managing director Mr. Alfred Chan introduced a downsizing programme to reduce staff from 2,400 to 2,000 by the year 2000, by means of natural attrition. Alfred Chan appointed a Change Director. He encouraged quality circles, creativity and problem solving training. Top management commissioned many cross-functional team quality projects. No one has been involuntarily laid off, but when the blue collar employees heard that the company was engaging in restructuring, were frightened of losing their jobs and made angry noises during meetings held to announce the company plans. Tensions grew worse during the Asian financial crisis. To calm fears, the company promised that there would be no pay cuts and no layoffs. Rather than laying people off, the company adopted programmes of redeployment and retraining. Staffs that lose their old jobs go into a pool, and are retained on full pay while they undergo retraining and wait for suitable new internal vacancies to arise. It is still worrying for people to go into the pool. Even at Towngas, where according to the case report there were no compulsory layoffs, there were still adverse reactions by employees that create a very negative image.
Power can be defined as a capacity that a person has to influence the behavior of another to fulfill his own wishes. Power is used as a means for achieving goals and it requires follower dependency.
Organizations are coalitions composed of individuals and groups with enduring differences who live in a world of scarce resources. That puts power and conflict at the center of organizational decision making. While power is often still defined narrowly in management theory and research (Fiol, 2001;Shen & Cannella, 2002), some scholars and social scientists have discovered many power forms which can take in organizations. Scott (2001) argues that forms of power can be differentiated based on the means through which they affect social action: by affecting the costs and benefits associated with different actions or by restricting the range of available actions.
"Personal power" is based on possession by a leader or an individual of desirable resources or personal traits. French and Raven (1959) used the term "Referent Power" to describe influence that comes when individuals who are attractive and socially adept-because of charisma, energy, stamina, political smarts, gift of gab, vision, or some other characteristic. For example, Barack Obama expanded his influence because he brought to the presidency levels of charm and humor.
"Formal Power" is established by an individual's position in an organization; conveys the ability to coerce or reward, from formal authority, or from control of information.
Authority is far from the only source of power-partisans have other sources they can draw upon. Authorities have "position power". Positions confer certain levels of legitimate authority. For example, professors assign grades and judges settle disputes.
"Coercive Power" is a power base dependent on fear. It rests on the ability to constrain, block, interfere, or punish. A union's ability to walk out and students' capacity to sit in.
"Legitimate Power" is the power a person receives as a result of his or her position in the formal hierarchy of an organization. Sometimes legitimate authorities are the dominant members of the coalition, as is often true in small, owner-managed organizations. But large corporations are often controlled by senior management rather than by stockholders or the board of directors.
"Expert Power" influence based on special skills or knowledge. Power flows to those with the information and know-how to solve important problems. It flows to marketing experts for example the faculty in elite universities.
"Reward Power" based on the ability to distribute rewards that others view as valuable such as money, jobs, political support, or other rewards brings power.
Getting things done in an organization involves working through a complex network of individuals and groups. Friends and allies make things a lot easier. Managers who spent too little time building networks had much more difficulty getting things done.
Alliances form in organizations since members have interests in common and believe they can do more together than apart. To fulfill their aims, they need power. Power can be viewed from multiple perspectives. Structural theorists typically emphasize authority, the legitimate prerogative to make binding decisions. In this view, managers make rational decisions; monitor actions to ensure decisions are carried out. A by-product of networks and alliances is access to decision arenas. Organizations and political systems typically give some groups more access than others. When decisions are made, the interests of those with "a seat at the table" are well represented. Partisans' multiple sources of power constrain authorities' capacity to make
Authorities are entitled to make decisions binding on their subordinates. Any member of the coalition who wants to exert bottom-up pressure is a potential partisan. Gammon (1968) described the relationship between authorities and partisan that "Authorities are the recipients or targets of influence, and the agents or initiators of social control. Potential partisans have the opposite roles-as agents or initiators of influence, and targets or recipients of social control"
An example of the relationship - In a family, parents function as authorities and children as partisans. Parents make binding decisions about playing, bedtime or even television viewing. Parents initiate social control, and children are the recipients of parental decisions. Children in turn try to influence the decision makers. They argue for a later bedtime or point out the injustice of giving one child something another wants. They try to split authorities by lobbying one parent after, the other has refused. They may form a coalition with grandpa, grandma and etc. in an attempt to strengthen their bargaining position.
Authority is essential to anyone in a formal position because social control depends on it. Officeholders can exert control only so long as partisans respect or fear them enough that their authority or power remains intact. If partisans are convinced that existing authorities are too evil or incompetent to continue, they will risk trying to wrest control-unless they regard the authorities as too formidable. If partisan opposition becomes too powerful, authority systems may collapse. The process can be very fast. Partisans' multiple sources of power constrain authorities' capacity to make binding decisions. Officeholders who rely solely on position power generate resistance and get outflanked, outmaneuvered, or overrun by others more versatile in exercising other forms of power. Kotter (1985) argues that managerial jobs come with a built-in "power gap" because position power is rarely enough to get the job done. Expertise, rewards, coercion, allies, access, reputation, framing, and personal power help close the gap. In conclusion, power is a key organizational resource and it will affect any organization in all levels.