Important Factors Contemporary Managers Must Consider Commerce Essay

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Management involves intricate balance and sometimes integrated balance in dealing with people within a business or organization. Contemporary manages offer integrative and fresh view of the workplace which must be in line with the varying surroundings of the business globe. Contemporary management is meant to view the manager as an individual who works with people within an organization therefore entitled or subjected to upholding the ethics and values of the organization. This type of management gives careful attention to cultural change, diversity, and global market. Contemporary managers are responsible for production in an organization.

Production involves all the methods utilized in transforming tangible in puts which includes raw materials, subassemblies and semi-finished goods, together with intangible inputs like ideas, know how and information, into goods or services. It is simply the act of manufacturing goods. When deciding on production, contemporary managers need to bear in mind some important factors which determine the success or failure of this process (Keat & Philip, 2008). Contemporary managers are faced with the challenge of deciding the quantity and quality of goods to be produced, how they are going to be produced and the challenge of motivating and understanding the vast number of diverse workforce and at the same time maintaining openness and accountability to the stakeholders. Their work involves planning for the future in the ever changing business environment and considering all the ethical implications their decisions may arise with (Hoboken & Robert, 2003). Contemporary management is involved in studying the performance of workers in order to be in a position to make operational improvements wisely (O'Sullivan & Steven, 2001). This type of management should be carefully trained in documentation of policies and be experts in recording and following procedures. They should have people’s skills which help them to interview and hire the best employees considering the production processes and procedures.

Quality products are the prime goal of every organization as it adds competitive advantage to businesses. In order for each organization to compete wisely, a company must be in a position to convert efficiently and effectively the resource in its reach such as labor, money, materials and information in goods and services. Contemporary management harmonizes and oversees these processes through operations management among its other tools. It manages the process which is responsible for the transformation of resources into goods and services. It welcomes product ideas and ideas involved in planning and the control of the systems that are involved in the production of goods and services.

All producers and manufactures are set to carry out the same function; which is transformation of inputs to outputs. To attain this sole goal manages must constantly strive to improve operational efficiency which includes lowering the cost of production, eliminating unnecessary expenses which add no value to the finished goods and to ensure lower expenses of labor and raw inputs. In order to achieve this, the product design should be made putting manufacturing in mind. In minimizing the number of parts, the product would be more simplified and the cost of production will be lowered (O'Sullivan & Steven, 2001). The responsibility of contemporary managers is therefore grouped as follows; production planning (which involves the knowledge of how the production will take place, where it will take place and the layout of the manufacturing facilities), production control (involves scheduling and monitoring the activities that make up the process which appropriate responses to feed back and adjustments where necessary), Quality control (involves all measures to ensure that goods are produced according to certain standards and specifications which must be maintained through the process of production).

Contemporary managers therefore have to consider different some factors in this process of production. Broadly, the factors to consider before production are recognized into labor, land and capital. These factors are clearly distinguishable and each plays a unique role in the process of production. Land encompasses all the resources that are not created by human beings like rocks, sunlight, and air among others (Aigner & Lovell, 1977). Land is usually said to be passive; it just exists. It requires labor however to make land usable by businesses. Labor may be in terms of brains or physical energy but it is collectively defined as labor (Collins, 1969). In order to gain more wealth or income from lesser wealth, this is called capital. Capital has the ability to increase labors capacity to produce wealth which leads to constant demand to for capital goods which will require some labor in order to supply the goods to the consumer.

The current business arena filled with technical and fundamental changes, presence of information technology, and the ever changing hierarchical arrangement of the organization networks and forms poses a big challenge to the contemporary managers in making decisions concerning production. They must therefore consider some factors before they estimate production. These include;

Production-Method Decision

The first step in estimating production is choosing the type of production process which is best for making the products the company plan to manufacture (Karl & Steven, 2000). This factor includes the option for customer customized products, consideration of the in put received from a specific customer before the production of the goods and if the products will be one of a kind or there will be continued production based on certain standards. The main work of the contemporary manager is to corporate with other managers and marketers of the products in order to select the product that will serve the customers in the best way (Karl & Steven, 2000). Production process should include a clear evaluation of opportunities where the best production idea is selected. A good and timely reaction to the market feedback helps management to make products which appeals and performs well with the customers. Market tests may be done through prototype as it ensures proper estimation of the appeal of the product to the customers and the expected rate of production.

Mass production and Customization

Many companies tend to manufacture large volumes of their products anticipating rise in demand. In order to estimate production well, there must be a well estimate of the demand and the capability to handle the large volumes which include raw materials, machinery, staff, transport and storage. Mass customization is a production method were large volumes are customized at reasonably low prices (Duggan, 1999). This is quite important factor in production which in fact must be considered before the commencement of production. It combines both the advantages of mass production and customization and requires proper and efficient interaction with the customer in order to identify their preferences and then embark on production which must involve less production costs. One preferred method by contemporary managers is mass production of products to a certain level then start customization process in order to meet the demands or reach a certain group of customers. Information technology has enabled consumers to customize their products on the internet thus enabling the company to concentrate on other areas and minimize the cost of customization (Keat & Philip, 2008). Companies and Dell and Nike have embraced this feature with a lot of success. This list of companies embracing mass production and customization is also growing steadily as companies devote a portion of their resources and operations completely to these activities. Customization is not always possible for some goods like toilet paper or detergents while some people are not willing to pay the extra fee which comes with customization.

Facilities Decision

After choosing the most convenient production process, the contemporary managers then choose the location where the goods will be manufactured and design how the facilities will be laid out.

Site Selection

In estimating production, contemporary managers must consider the location where the goods will be produced as this will either increase or minimize shipping costs; both for finished products and raw materials. It has been the goal of many contemporary managers to locate manufacturing facilities close to customers’ or suppliers or both. They prefer location near skilled workers, in areas with low cost of resources and a somewhat favorable business climate. Although it is hard to find areas with all these factors, managers identify aim for the most important criteria which can satisfy them.

Capacity Planning

In estimation of the production, capacity planning is most paramount. The company needs to decide the quantity they are going to produce based on the demand of the products. The quantity is gotten through forecasting the number of units expected to be sold in a specific period of time. This needs a well understanding of the industry you are in and the most probable market share you expect which requires a full review of the industry data and other forms of market research (Keat, & Philip, 2008). A good forecast of demand of your products gives you an insight on capacity requirements, production facilities needed and the maximum number of goods expected to be produced over a given period of time. Investment in the plants’ equipment and the amount of labor requirement for the company to produce at maximum can be guided by this estimate. Capacity planning is a difficult task just like forecasting and it requires the contemporary managers to strike a balance between demand and project capacity failure to which detrimental results will be expected. If the demand is projected too high, you end up producing excess products and if the demand estimates are too low, the company will not be in a position to meet the demands of the customers.


Among the most important factors to consider when estimating production, labor should be a priority. You can not achieve the estimated quantity if there is not enough man power to achieve this. It will also be impossible to get the intended quality if there is no well trained and skilled labor. Contemporary managers should therefore possess skills of managing people so as to achieve certain tasks, establish discipline, maintain authority, and be certain on direction and plans which are consisted in all aspects in the company (George & Jennifer, 2007). Planning for labor includes considering equitable pay for the workers, mechanisms of handling conflict and centralizing operations whenever possible or appropriate. A well organized labor ensures organized workflow, order fairness and predictability which are of utmost importance in estimating production.

Business Environment

The business environment is not static. Contemporary managers should stay in constant evaluation and forecasting of the world markets, political stability and emerging business information technology. Business environment affects production and may lead either to increased or decreased production (Randolph, Gareth & Ellen, 2000). Emphasis should be put by management to effectively work in a global market place absorbing all forms of diversity at the very first incidence. For increased production, companies should foster strong ties with the community in order to ensure sustainable environment which leads to the build up of collaborative skills. A good example is the automobile industry. Due to the escalating price of fuel, automobile buyers are shifting their preference for light trucks and SUVs vehicles which are economical. Automobile company General Motors reacted to this change in the business environment by cutting down the production of pick-up trucks (Anthony, 2007). The emergence of information technology completely changes how businesses operate. In estimating productivity, there is need to estimate production function supplemented by information technology and organizational design; these factor help in correction of unobserved heterogeneity. The incorporation of information technology substitutes or compliments production and it is usually industry specific.

Information technology guides quality management and provides a competitive advantage together with market leadership in the global business environment. It breaks market barriers both in the contemporary technologies like manufacturing service and process sectors but also in the domain of cutting edge (Kapur & Verma, 2005). In estimation of production, information technology comes as an important factor to consider as it improves sophistication and organizational awareness which result to the marketing of high quality products which can race efficiently in the international market and cope up with market pressures.

Since contemporary management engages in organizing, planning, controlling and leading operations in order to achieve organizations goals, it has the responsibility of guiding the production process so as to ensure the overall success of the organization (Duggan, 1999). Estimating production is not easy and it involves building of skills in decision making, supervision of personnel and monitoring of information. If all factors affecting production are considered carefully, production estimation will be a success.