Internal and External Factors that Impact the Functions of Management
Several internal and external factors impact the functions of management. Among them are the buyers, suppliers, competitors, local government, unions, employee groups, the financial community, owners and shareholders, and trade associations. Globalization, Technology, Innovation, diversity, and ethics are common factors that impact the functions of management. These factors influence decision-making in an organization. External forces are uncontrollable and they are not within the organization’s boundaries unlike the internal forces (Koontz & Weihrich, 2006).
The domination of the world economy by multinational companies as a result of free trade policies and practices is termed globalization (Vogel, 2009, Para. 4). The driving force of globalization is the need for new markets and thorough exploitation of existing ones to maximize some multinational company’s profits (Vogel, 2009). Toyota one of the largest companies in the world is set to surpass General Motors and become the top in the auto industry (Vogel, 2009). “Toyota motor cooperation is the world standard of globalization and its policies and practices are imitated worldwide” (Vogel, 2009, Para. 7). The Toyota forces of change are racking the auto industry and undermining working people including their communities across the North American continent (Vogel, 2009). Extensive exploitation of cheap labor and the reduction of operational costs through the state, boost the organizations’ revenue more than their manufacturing. This shows how globalization works and its impacts on local workers, their community, and the environment. The Toyota Company is a good example that shows how the domination of capital over labor in the auto industry has been achieved in collaboration with the state (Vogel, 2009).
The Impacts of Globalization, Technology, Innovation, Diversity and Ethics on the Functions of Management
Technological strategies in an organization start with the skills and knowledge as corporate assets. This plays an important role in the process of change within an organization, especially in management processes. Technology creates a range of new products, enables new production techniques and good management (Urabe, Child & Kagono, 1988). Organizations work on improving their technology to have a competitive niche. Advancing technology gives more room to organizations to venture into markets that could be unavailable to them. Management and communication are improved with the development of new technology. Computerization and networking management enable information to be available when needed and whenever it is needed. Technological advances create innovations. Organizational strategies that are created from technology create a competitive advantage for an organization (Urabe, Child & Kagono, 1988).
To achieve a company’s goal and move to new markets, managers require innovative thinking, in developing new products as well as marketing the products. Innovation helps to generate and maintain a competitive advantage in domestic and international trade (Urabe, Child & Kagono, 1988). With innovation, there is a quality production, cost minimization, increase in productivity, and maximization of product performance. Innovation has both positive and negative impacts depending on how managers choose effectively. Managers who are creative come up with successful innovations thus higher organization profitability (Urabe, Child & Kagono, 1988).
Diversity is a good strategy to promote the perception, acknowledgment, and implementation of diversity in an organization to achieve its goals (Arredondo, 1996). Diversity can be a good source of innovation for future development and competitiveness. Diversity helps an organization to develop and give a broad range of products and services. Diversity creates equal opportunity for all as it reduces discrimination. Open-mindedness is the key to achieving organizational diversity (Arredondo, 1996).
Ethics holds that an action is good for an organization’s development. The values of ethics are honesty, loyalty, fairness, integrity, respect, responsibility, and pursuing excellence. Ethics are for the common good of an organization to achieve its goals fairly. Ethics create a good image of an organization. Making ethical decisions needs an understanding of the implications of the issue, being aware of which actions are morally defensible, and the power to act by your ethics. Managers contribute to ethical planning, organizing, leading, and controlling improvements and hence the achievement of organizational goals (Petrick & Quinn, 1997).
Delegation to Manage the Impact of these Factors on the Functions of Management
Responsibility and authority must be assigned by managers to know who is performing a certain task, where, and when. Before delegating work, managers should consider the desired results, the risk involved, and his/her confidence in the available resources. Planning ascertains specifications including expected results and constraints (Tomey, 2004). The delegated authority must be specific and there should be supportive when needed. There should be understanding as the manager delegates authority, give and receive feedback and respond to arising issues. Delegation helps to develop others and it is time-saving. It maximizes individual talent and reduces managerial costs thus contributing to an organization’s development (Tomey, 2004).
References
Arredondo, P. (1996). Successful Diversity Management Initiatives: A Blueprint for Planning and Implementation. New Barry Park, California, SAGE.
Koontz, H. & Weihrich, H. (2006). Essentials of Management (7th ed.). West Patel Nagar New Delhi, Tata McGraw-Hill.
Petrick, J. & Quinn, J. (1997). Management Ethics: Integrity at Work (Vol. 6 of SAGE
Series in Business Ethics Business Ethics Series). New Barry Park, California, SAGE.
Tomey, A. (2004). Guide to nursing management and leadership (7th ed.). Amsterdam, Elsevier Health Sciences.
Urabe, K., Child, J. & Kagono, T. (1988). Innovation and Management: International Compartisons. Berlin, Walter de Gruyter.
Vogel, D. (2009). US Forum on Combating Globalization. How Globalization Works: Toyota Motor Manufacturing, Texas (TMMTX) Case Study. Web.