The Modern Organization
The modern corporations are viewed through theories developed after the Industrial Revolution. Max Weber and Karl Marx shared this view. Max Weber wrote an essay about bureaucracy. His work crystallized the understanding of the organizational structure of a firm, the understanding that would last for generations. His view also applies to government agencies and NGOs. On the other hand, Karl Marx located the capitalists’ enterprise in a large political economy. This aspect influenced historians and other socialists for the rest of the century (Sarlak, 2010).
Max Weber argued that in war and business, the greatest armies and those with novel technologies win. However, the most important victory is for the entities that can mobilize the energies of their members to achieve a common goal. Weber aimed to show that normal social ties of employees are irrelevant so that they abandon their family associations and identities outside the organizations.
Karl Marx captured important dimensions of changes that systematized new developments into a comprehensive and compelling framework. Karl Marx’s account of capitalism was not very accurate, and contemporary scholars have amended it. Marx only identified the logic of capitalism, the centrality of an organization, and the large-scale firm (Sarlak, 2010). Marx understood that the competition among the profit-seeking firms caused endemic antagonism between the employer and workers. Karl Marx explicated what this conflict implied for the firm as he had prodigious perceptivity on the issue.
The present views of the organization based on the joint views of Weber and Marx have shaped the perceptions of different firms. This view has also identified key factors that constitute the present industrial order. At the organizational level, the critical factor is bureaucracy, while at the economic level; the key factors include political and legal institutions and a free market.
Advanced market systems run on several institutional foundations. From the government, the institutional bases include security and contract law among others. These institutions ensure that the players involved in a market transaction get what they pay for in the process. Another range of institutions includes insurance, limited liability firms, and government agencies, which pool risks and help in limiting uncertainties (Sarlak, 2010). All the institutions of the capitalist economy provide a business environment in which large bureaucratic firms operate successfully. This environment reduces the scope of other possible types of organizations across all the industrial economies. Through the capacity of control afforded by the bureaucratic model, both the state and the financial sectors that produce trusts can conduct their responsibilities efficiently and credibly.
This bureaucratic model developed by Weber together with the modified capitalist model of the economy, which was initially developed by Karl Marx, appreciates corporate entity. Weber’s model shows the internal organizational structure. On the other hand, the Capitalists model explains how the company relates to its employees, rivals, and government laws. These two models were primarily analytic and not prescriptive. However, the contexts used in training students in management assert their view, impress upon the managers in the future to reduce uncertainty, buffer the core of their enterprises to remain stable at all costs, and develop competitive strategies the preserve the autonomy of the company.
The 21st Century Economy
The 21st-Century economy is seen to be market capitalism where the government plays a critical role in determining the results with the sole objective of promoting national endeavors. The economy is characterized by the use of the term state capitalism, which refers to the state corporations that are competing with the private sector. In this state capitalism, governments intervene in the markets using more faint tools (Pupo & Thomas, 2010).
This model does not favor firms that intend to compete globally. When the government is involved, there is minimal certainty, security, and respect for the law. This aspect underscores the need to assess strategically the priorities of the countries where the organization wants to base its operations. In a given country, the strategic sector reserved by the state could be a free potential investment chance in another country (Schor, 2014). For instance, telecommunication may be protected as strategic in one country where renewable or alternative energy is liberal. On the contrary, in another country, energy could be a state privilege, thus leaving telecommunication to the private sector.
The state capitalist economy in contemporary times involves the use of the gentle legislature and other tools of policy like anti-monopoly approaches, which safeguard and sanction state agencies. The policies claim to promote competitive markets. The business environment is progressively balanced against international rivals to advance some critical economic results. Due to the make-up of the developing global economy, international agreements on standard regulations are increasing, and they are playing key roles in creating new rules for governing the strategic areas. These standards are set by countries whose state-owned corporations are the dominant players.
As an example, China is one of the countries with anti-monopoly regulations, which appear as repressive to the Western world that encourages capitalism and free-market policies. The European chamber of commerce based in Beijing has criticized the government severely for its crackdown on the alleged violations of the anti-monopoly laws (Pupo & Thomas, 2010). The officials claim to have been subject to intimidation tactics. This example is one of the many cases of state capitalism coupled with how some countries are creating skewed laws in the 21st economy to promote the interest of state-owned corporations.
State organizations and other autocratic players in the market work hand in hand with the state to gain some favors from authorities as they collaborate to promote the agreed standards, which are inclined towards protecting their interests (Schor, 2014). However, those dominant businesses, which have acquired their current market status under the existent rules, and thus not backed up by their countries of origin, are at risk.
New Leadership Paradigm
In this 21st century, leaders function in contexts characterized by high levels of diversity and flux. In this postmodern environment, leaders need to have new mindsets and skills. They should be flexible to allow, initiate, and manage change. Additionally, leaders must be creative. This assertion holds because the world is experiencing unparalleled continuous changes. Therefore, many company leaders argue that the present leaders have to be creative and innovative. A research carried by IBM in 2010 pointed out that the world will continue to be complex and may leaders are concerned with the ability to initiate and manage change (Barrett, 2010).
Creativity is not new in leadership, but it is currently being seen as an important aspect of the practice. Most modern descriptions of leadership such as constructionist leadership, adaptive leadership, transformational leadership, and leadership at the top use qualities and strategies that are used in the field of creative studies. Creativity is the production of something new, which is novel and useful. Something new could be a policy, process, or product. From the definition of leadership, creative leadership could be defined as being in a position to involve the people’s imaginations to identify and lead a group towards a certain goal.
This description of creative leadership fits in the budding thoughts about the skills that leaders should have in the 21st century. The leaders should be ready to embrace ambiguity and take risks while at the same time being in a position to influence and inspire their teams in new directions (Barrett, 2010). These new millennium demands make creative leadership a relational process of bringing new ideas that accomplish positive change. Therefore, creative leadership harnesses a recognized understanding of creativity coupled with emphasizing the influencing and relational aspects of a leader. It specifies important results to the 21st century.
In the ever-changing world, creative leadership skills are crucial to any leader. This creativity in leadership offers a distinct mindset and skill set to the leader (Lines & Scholes-Rhodes, 2013). The skills are well-matched with contexts that require the use of diversity, tolerance for ambiguity, and the ability to initiate and manage change towards achieving goals of the organization and society.
Creative leadership is relational, and it utilizes diversity. It is self-reflective, and it focuses on achieving a positive change. Additionally, it lies between transcendent and transformational approaches. Consequently, creative leadership is ranked with similarities to global, relational, authentic, and situational leadership. Therefore, it suffices to conclude that leaders in the 21st century should embrace creative leadership for organizations to remain competitive in the domestic and international markets.
References
Barrett, R. (2010). The new leadership paradigm: Leadership development textbook for the twenty-first-century leader. Lexington, KY: Lulu.
Lines, H., & Scholes-Rhodes, J. (2013). Touchpoint leadership: Creating collaborative energy across teams and organizations. London, UK: Kogan Page.
Pupo, N., & Thomas, M. (2010). Interrogating the new economy: Restructuring work in the 21st century. Toronto, ON: University of Toronto Press.
Sarlak, M. (2010). The new faces of organizations in the 21st century: Management and business reference book. Toronto, ON: NAISIT Publishers.
Schor, J. (2014). A sustainable economy for the 21st century. New York, NY: Seven Stories Press.