Pernec Corporation Berhad Company Management Style Commerce Essay


Pernec Corporation Berhad is one of Malaysias leading telecommunications infrastructure and information, communications and technology companies. The company has its significant presence in the country and the region through subsidiaries, joint ventures, associated undertakings and investments.

In relation to the company management style, Pernec Corporation Berhad is more of a democratic management style company. Due to the company having various departments and subsidiaries such as Pernec Paypoint, Pernec Telco and Pernec IT, Pernec uses democratic management style as it works well due to managers as the links between departments and top management.

The managers, which are the key people in the company, will decide how tasks will be addressed, and who will perform them, while never losing sight of the fact that the manager bears ultimate responsibility. Certain matters can be decided through meeting, discussion and consultation. The manager will consult their team before making decisions, while still maintaining overall control. Through this management style, employees are more engaging and productive through giving out their opinions and ideas before reaching a decision. This will make employees feel involved and part of the process and motivated to do their work.

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The most important key person in this company is actually the Managing Director, Abdul Karim. A managing director works for charting the blueprint of policies and implements them for the improvement of the firm. He acts as a head of the firm scrutinizing, assessing and monitoring various departments. The heads of all departments are answerable to him and he is answerable to the customers, board of directors about the firm's performance (Pandey 2011).

Generally, there is no direct information to determine the individual personality of the Managing Director. However, looking at how Pernec deals with projects and its vision, it can be suggested that Abdul Karim has highly independent, confident and driven personality. He has this competitive, no-nonsense type who likes to get to the point and a risk taker. As such, he embraces change and is always looking for practical solutions for solving problems. According to Yunus in a newspaper article, 'despite suggestions that the payphone is becoming a sunset industry in the advent of latest mobile communications, Abdul Karim said he is still confident of the demand for payphone services' (News Straits Times 2010).

Company Structure and Subsystems

As for the company structure, Pernec has typical hierarchical arrangement of lines of authority, rights and duties in the company. A structure is important because 'structure is created to establish relationships between individuals and groups, to provide order and systems and to direct the efforts of the organisation into goal-seeking activities' (Mullins 2010: 7). Pernec company structure consists of Internal Audit management at the top layer (Chairman, followed by Managing Director) which has most of the decision making power and has tight control over departments and divisions.

The layer bellow is the division of Strategic Business Units and Strategic Supports Units. Each unit has its own separate roles where the Strategic Business Units is the marketing division (Pernec Paypoint, Pernec Telco and Pernec IT) and Strategic Supports Units (Human Resources, Finance & Accounts, Strategic Planning, and Corporate Communications) which serves as focal point on specific duties and undertake any other duties as assigned. The company structure is shown below in Figure 1:

Figure 1. Pernec Organizational Structure

The Business Unit is where the company makes profit. In general, the input in this case is by identifying what customer needs through the market. This is a major factor that influence the company and important to the company. Pernec sess that there is a major increase in customer needs of using the latest version of Internet Protocol IPv6 that has encouraged Pernec to develop products that will support the use of IPv6.

From the collected information, Pernec implements the idea to develop products such as that will support IPv6 using correct mechanism and specifications as part the process.

As the output, Pernec produced products such as SolidDNS, SolidPBX, and SolidWall that supports IPv6. These products are sold to customer so that customer can have a reliable ICT infra and focus on their respective core business.

Working Practices

From working practices point of view, it is clear that Pernec encourage at practicing "Market-Oriented Culture". This type of competing in the market can be seen through Pernec WiFi Hotspot Project. In the company press release, Pernec realise the economic benefit and strives to compete in the market by expanding its WiFi Hotspot coverage nationwide and also to become the leading WiFi network operator (Daud 2012). In another Pernec project, it is stated that 'Pernec recently signed a strategic alliance with DualStak Networks Sdn Bhd and Nephos6 Inc to ride on the momentum of the anticipated demand for IPv6-compliant solutions and hardware' (Daud 2012).

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The company has a clear sales goal and is focused on competing in the market and always aware of the environment needs and customer satisfaction. For the company, success means market share and penetration. In addition, Pernec believes that competitive pricing and market leadership are important in doing business.

In another way, Pernec wants to be the company that inspires innovation in the competitive industry of communications and ICT through its vision that is 'To be a technology company that inspires innovation towards providing excellent service and enabling value creation.' (Pernec Corporation Berhad 2010)

Question 2

In comparison and contrast between theory and practice, it can be seen that the company practice democratic management style. In theory, democratic management style 'is where the focus of power is more with the group as a whole and there is greater interaction within the group. The leadership functions are shared with members of the group and the manager is more part of a team. The group members have a greater say in decision-making, determination of policy, implementation of systems and procedures' (Mullins 2010: 381). From this view, the company practice the same as the theory because every meeting or discussion within the company will enquire interaction between both employees and managers before finding a decision.

Another thing to compare is the company organizational culture. In theory, organizational culture is 'a set of shared values, the unwritten rules which are often taken for granted, that guide the employees towards acceptable and rewarding behaviour' (Gupta 2009). Practically, this is what the company does. Pernec values integrity, simplicity, and innovation through collaboration and partnership. To achieve those qualities the company must provide a strong support to the group, by appreciating qualities of integrity, simplicity, innovation from employees and to provide the required stability to the company, now and to the future.

For Pernec organizational culture, the company is practicing a "Market-Oriented Culture". According to Schein, organizational culture is defined as 'a pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems' (2004: 17). In relation to the company, Pernec tries to adapt the culture within the employees, encouraging the employees to be competitive and goal-oriented.

Question 3

Although Pernec is doing well at satisfying customers and into the market heavily, they should also increase sales through a marketing campaign. This is an advantage if Pernec expand its marketing campaign so that they can attract more customer and increase chances of collaboration. Other than that, the company can improve employee morale by setting up a suggestion scheme, then rewarding and implementing good suggestions. Though this, employees will feel connected and belonged to the company and this will discourage employee from leaving the company.

Being a competitive company, project handling can be slightly challenging. Another recommendation for this is by increasing informal monitoring early in the project. This can improve project handling efficiency by monitoring the progress of a project from time to time. As for customer satisfaction, Pernec can improve the effectiveness of its website too. Customer or business investors often prefer to look toward the business's website for information and answers before reaching out to the company. By doing so, it will increase the interest of such case for business inventors to invest in Pernec or do joint ventures with the company. Moreover, the reputation of the company will also rise and become more solid as customers can see the passion of the company through delivering detailed information on the company's website.

To be one step further in the business, Pernec should implement training and continuous education programs for the employee as they are very effective methods for improving and maintaining customer satisfaction. Employees will be more confident when answering questions and converse on the products as they are exposed and trained by those programs.