Enterprise Management Notes
Enterprise Management Notes
Enterprise Management Notes
Enterprise Management
Introduction to Management
• Non-managerial employees are people who work directly in a job / task and have no
responsibility for overseeing the work of others, e.g. associates, team members
Management Levels
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• Top Managers: They are responsible for making decisions about the direction of the
organisation, e.g. President, Chief Executive Officer (CEO), Vice-President
• Middle Managers: They manage the activities of others, e.g. District Manager, Division
Managers.
• First-Line Manager: They are responsible for directing non-managerial employees, e.g.
Supervisor, Team leader.
What is ‘Management’?
Management is the process of getting things done effectively and efficiently, with and
through people.
Management “is the act of getting things done through others and having them do it
willingly” - American Management Association (AMA).
Effectiveness
“Doing the right things”. Doing those tasks that help an organisation reach its goals.
Efficiency
Concerned with the means, efficient use of resources like people, money, and equipment.
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• Level in the Organisation - Top level managers do more planning than supervisors
• Profit vs. Nonprofit - Management performance is measured on different objectives
• Size of the Organisation - Small businesses require an emphasis in the management role of
spokesperson
• National Borders - These concepts work best in English-speaking countries and may need to be
modified in other global environments
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• Today we’re discovering that employee attitudes and behaviours play a big part in
customer satisfaction.
• Innovation isn’t just important for high technology companies but essential in all types
of organisations.
Early Management
Organised endeavours directed by people responsible for planning, organising, leading and
controlling have existed for thousands of years.
Scientific Management
Frederick W. Taylor described scientific management as a method of scientifically finding the “one
best way to do a job”
- Hugo Munsterberg, pioneer in the field of industrial Max Weber described the bureaucracy as an
psychology
ideal rational form of organisation
- Mary Parker Follett, recognised that organisations Henri Fayol identified five management
could be viewed from both individual and group functions & 14 management principles.
behaviour
The studies:
• Provided new insights into individual and group behaviour in the behaviour of people at work.
• Concluded that group pressures can significantly impact individual productivity.
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•
Quantitative Approaches
Contemporary Approaches
• Focused on managers’ concerns inside the organisation.
• Chester Barnard wrote in his 1938 book The Functions of the Executive that an
organisation functioned as a cooperative system.
• Fred Feildler first popularised the contingency approach (or situational approach)
which says that organisations, employees, and situations are different and require
different ways of managing.
Management Today
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Decision Making
Decision Making Process - A set of eight steps that includes identifying a problem,
selecting a solution, and evaluating the effectiveness of the solution.
Problem - A discrepancy between an existing and desired state of affairs
Decision Implementation
Putting a decision into action; includes conveying the decision to the persons who will be
affected by it and getting their commitment to it.
Heuristics
“Rules of Thumb” to simplify decision making.
Overconfidence Bias
Unrealistically positive views of one’s self.
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Decision Making
• Policy - A general guide that establishes parameters for making decisions about
recurring problems.
• Procedure - A series of interrelated sequential steps that can be used to respond to a
well-structured problem (policy implementation).
• Rule - An explicit statement that tells managers what they ought or ought not to do
(limits on procedural actions).
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• Certainty - A situation in which a decision maker can make accurate decisions because
all outcomes are known
• Uncertainty - A situation in which a decision maker has neither certain nor reasonable
probability estimates available
• Risk - A situation in which a decision maker is able to estimate the likelihood of certain
outcomes
Advantages Disadvantages
Group decisions provide more complete Group decisions are time consuming
information. May be subject to minority domination
Diversity of experiences and perspectives are Subject to pressure to conform
higher. Responsibility is ambiguous
Groups generate more alternatives. Subject to Groupthink which undermines
Group decisions increase acceptance of a critical thinking
solution.
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What is organising?
What is Departmentalisation?
Cross-functional Teams are teams made up of individuals from various departments and
that cross traditional departmental lines.
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Types of Departmentalisation
Chain of Command is the line of authority extending from upper organisational levels to
lower levels, which clarifies who reports to whom.
Authority, the rights inherent in a managerial position to give orders and expert the orders
to be obeyed.
Line Authority is authority that entitles a manager to direct the work of an employee.
Staff Authority are positions with some authority that have been created to support,
assist, and advice those holding line authority.
Chain of Command is the line of authority extending from upper organisational levels to
lower levels, which clarifies who reports to whom.
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What is Power?
Authority goes with the job, but power refers to an individual’s capacity to influence
decisions.
Authority is part of the larger concept of power.
Authority vs Power
Types of Power
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What is Formalisation?
Formalisation
How standardised an organisation’s jobs are the extent to which employee behaviour is
guided by rules and procedures.
Centralisation
The degree to which decision making takes place at upper levels of the organisation.
Decentralisation
The degree to which lower-level managers provide input to actually make decisions.
Mechanistic Organisation
A bureaucratic organisation; a structure that’s high in specialisation, formalisation and
centralisation.
Organic Organisation
A structure that’s low in specialisation, formalisation and centralisation.
Mechanistic vs Organic
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Unit Production
The production of items in units or small batches
Mass Production
Large-batch manufacturing
Process Production
Continuous flow of products being produced
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Team Structure - A structure in which the entire organisation is made up of work teams.
Matrix Structure - A structure in which specialists from different functional departments
are assigned to work on projects led by a project management.
Project Structure - A structure in which employees continuously work on projects.
Boundary-less Organisation - An organisation whose design is not defined by, or limited
to, boundaries imposed by a predefined structure.
Virtual Organisation - An organisation that consists of a small core of full-time employees
and outside specialists.
Network Organisation - An organisation that uses its own employees to do some work
activities and networks of outside suppliers to provide other needed product components
or work processes.
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Learning Organisation
An organisation that has developed the capacity to continuously learn, adapt, and change.
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PESTLE Analysis
Political
Economic
Social
Technological
Legal
Environmental
Political Factors
Taxes & charges | Government budgets | Type of Government | Political stability |
Political risk | Political parties
Economic Forces
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Socio-Cultural Factors
Demographics
Age Structure | Size | Gender Balance | Urbanisation | Emigration & Migration | Birth rates
Environmental Factors
Climate change impact Impact of natural disasters
Legal Factors
Specific legal environment in which a particular business operates.
• Ages and Discrimination Legislation
• Consumer Protection Laws
• Employment Laws
• Competitor Legislation
• Health & Safety Legislation
Technological Factors
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Technological Factors
- Broadband connectivity
- Availability and speed of the internet
Stakeholders
• Who are shareholders?
• Who are stakeholders?
• How important are these people?
• How can we manage them? - Functions of management
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Structure
Authority relationships | Coordinating mechanisms | Job redesign | Spans of control
Technology
Work processes | Work methods | Equipment
People
Attitudes | Expectations | Perceptions | Behaviour
The external forces that create the need for organisational change come from various
sources:
Marketplace | Technology | Government Laws & Regulations | Economy | Labour Markets
Change Agents are people who act as change catalysts and assume the responsibility for
managing the change process.
Change Metaphors
“Calm Waters” - Likens organisational change to a large ship making a predictable trip
across a calm sea and experiencing an occasional storm.
“White-Water Rapids” - Likens organisational change to a small raft navigating a raging
river.
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Survey Feedback
A method of assessing employees’ attitudes toward and perceptions of a change.
Process Consultation
Using outside consultants to assess organisational processes such as workflow, informal
intra-unit relationships, and formal communication channels.
Team-Building
Using activities to help work groups set goals, develop positive interpersonal relationships,
and clarify the roles and responsibilities of each team member.
Intergroup Development
Activities that attempt to make several work groups more cohesive.
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What is Stress?
Stress is the adverse reaction people have to excessive pressure placed on them from
extraordinary demands, constraints or opportunities.
Personal Factors
Type A Personality
People who have a chronic sense of urgency and an excessive competitive drive
Type B Personality
People who are relaxed and easygoing, and accept change easily.
Wellness Programmes
Programmes offered by organisations to help employees prevent health problems
Symptoms of Stress
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Creativity is the ability to combine ideas in a unique way or to make unusual associations
between ideas
Innovation is the process of taking a creative idea and turning it into a useful product,
service, or method of operation.
Innovation Variables
Structural Variables
Organic Structures | Abundant Resources | High Inter-unit Communication |
Minimal Time Pressure | Work & Non-work Support
Culture Variables
Acceptance of Ambiguity | Tolerance of the Impractical | Low External Controls |
Tolerance of Risks | Tolerance of Conflict | Focus on Ends | Open-System Focus |
Positive Feedback
Fostering Innovation
Idea Champions are individuals who actively and enthusiastically support new ideas,
build support for, overcome resistance to, and ensure that innovations are implemented.
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What is a Group?
A group is two or more interacting and interdependent individuals who come together to
achieve specific goals.
Command Groups
Groups that are determined by the organisation chart and composed of individuals who
report directly to a given manager.
Task Groups
Group composed of individuals brought together to complete a specific job task; their
existence is often temporary because when the task is completed, the group disbands.
Cross-Functional Teams
Groups that bring together the knowledge and skills of individuals from various work areas
or groups whose members have been trained to do each other’s jobs.
Self-Managed Teams
Groups that are essentially independent and that, in addition to their own tasks, take on
traditional managerial responsibilities, such as hiring, planning and scheduling, and
evaluating performance.
Forming Stage is the first stage of group development in which people join the group and
then define the groups purpose, structure, and leadership.
Norming Stage is the third stage of group development, which is characterised by close
relationships and cohesiveness.
Performing Stage is the fourth stage of group development, when the group is fully
functional and works on the group task.
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Adjourning Stage is the final stage of group development for temporary groups, during
which groups prepare to disband.
Role
Behaviour patterns expected of someone who occupies a given position in a social unit.
Norms
Standards or expectations that are accepted and shared by a group’s members.
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Group Cohesiveness is the degree to which group members are attracted to one another
and share the groups goals.
Problem-Solving Teams
A team from the same department or functional area that’s involved in efforts to improve
work activities or to solve specific problems.
Cross-Functional Team
Teams made up of individuals from various departments and that cross traditional
departmental lines.
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Virtual Team
A type of work team that uses technology to link physically dispersed members in order to
achieve a common goal.
Groups vs Teams
Adequate Resources
The teams ability reduced without adequate resources
Trust
Team members must trust each other.
Context
Adequate Resources | Leadership & Structure | Climate of Trust |
Performance Evaluation and Reward Systems
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Composition
Abilities of Members | Personality | Role Allocation | Diversity | Size of Teams |
Member Flexibility | Member Preferences
Work Design
Autonomy | Skill Variety | Task Identity | Task Significance
Process
Common Purpose | Specific Goals | Team Efficiency | Conflict Levels | Social Loafing
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What is Motivation?
Motivation is the process by which a persons efforts are energised, directed, and
sustained toward attaining a goal.
Individuals differ in motivational drive and overall motivation varies from each situation.
Maslow was a psychologist who proposed that within every person is a hierarchy of five
needs:
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Theory X is the assumption that employees dislike work, are lazy, avoid responsibility, and
must be coerced to work.
Theory Y is the assumption that employees are creative, enjoy work, seek responsibility,
and can exercise self-direction.
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Goal-Setting Theory includes specific goals to increase performance and difficult goals,
when accepted, results in higher performance.
Self-efficiency is an individuals belief that they are capable of performing a task.
Job Design is the way tasks are combined to form complete jobs.
Job Characteristics Model (JCM) is a framework used for analysing and designing jobs
that identify five primary core job dimensions, their inter-relationships, and their impact on
outcomes.
Job Enrichment is the vertical expansion of a job by adding, planning, and evaluating
responsibilities.
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Equity Theory is the theory that an employee compares their job’s input-outcomes ratio
with that relevant of others and then corrects any inequity.
Referent is the persons, systems, or selves against which individuals compare themselves
to assess equity.
Distributive Justice is the perceived fairness of the amount and allocation of rewards
among individuals.
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Procedural Justice is the perceived fairness of the process used to determine the
distribution of rewards.
A Compressed Workweek is a workweek in which employees work longer hours per day
but fewer days per week.
Flexible Work Hours (Flexitime) is a scheduling in which employees are required to work
a certain number of hours per week but are free, within limits, to vary the hours of work.
Job Sharing is when two or more people spilt / share a full-time job.
Telecommuting is a job approach in which employees work at home but are linked by
technology to the workplace.
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Communication
Noise
Written Communications
Memos | Letters | E-Mails | Organisational Periodicals | Bulletin Boards
- Tangible, Verifiable and more permanent
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Oral Communications
They allow receivers to respond and presents feedback evidence that the message has
been received and understood.
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Active Listening is listening for full meaning without making premature judgements or
interpretations.
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Negotiation is a process in which two or more parties who have different preferences
must make a joint decision and come to an agreement.
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Introduction
Management is:
“A career involving that task of guiding and controlling organisations.”
“The process that managers go through to achieve organisational goals.”
“Individuals who guide and control organisational activities.”
“A bout of knowledge which provides information about how to manage.”
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Levels of Management
Roles of Management
Top
Interpersonal; A figurehead, Leader, Liaison
Middle Informational; Monitor, Disseminator,
Spokesperson
Management Skills
1. Technical
2. Interpersonal
3. Conceptual
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Effective Managers
In order to provide the opportunity for high performance, both managers and employees
must understand their jobs and what they do, as opposed to what they should do.
Effective managers are constantly searching for ways to help employees to do their jobs
well and to focus on their activities and efforts on production matters.
To provide incentives for employees to achieve high performance, a manager needs to
identify the factors that motivate employees and build those factors into the work
environment.
Although management has been around since the days of the Pharaohs, it was the
Industrial Revolution that heightened its awareness, interest and practice.
The debate that ensued was know as the Classical School of Management.
1. Sumerian's
2. Egyptians - Planning
3. Greeks - The needs for different management functions
4. Roman Empire - Delegation and the Scalar Principle of Authority were used, coupled
with communication
5. Venetians - Legal foundations of the Enterprise
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Industrial Revolution
Up until the 1700’s management was seen in organisations such as the military, political
parties and the Church and not in industry.
Benefits
• Improved Productivity
• Improved Efficiency
• Links between effort and reward
• Installed a sense of cooperation between workers and management
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Administrative Management
14 Management Principles
Bureaucracy
Division of Labour | Hierarchy | Selection |
Career Orientation | Formalisation | Impersonality
Human Relations
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Summary
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Culture
What is Culture?
“Culture is the total complex pattern of customary human behaviour, social norms
and material trait embodied in thoughts, speech, action, and artefacts and
dependent upon the human capacity for learning and transforming knowledge, and
systems of abstract thought.” - Thompson, 2001
Culture includes also things like beliefs, morals, laws, customs, opinions, religions,
superstitions, and art.
Despite its complexity, the concept “culture” has been well defined.
For instance, the 1982 World Conference on cultural policies defined culture as the
“whole complex of distinctive spiritual, material, intellectual and emotional features
that characterise a society or social group. It includes not only the arts and letters,
but also modes of life, the fundamental rights of human being, value system,
traditions and beliefs.” - Doda and Ranan 2007
"Culture is more often a source of conflict than of synergy. Cultural differences are a
nuisance at best and often a disaster."
- Prof. Geert Hofstede, Emeritus Professor, Maastricht University.
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National Culture
Business Culture
Company Culture
Individual Culture
High Japanese
Arabs
Latin America
Context
English
U.S.
Scandinavians
Germans
Low Swiss
Explicit Message Implicit
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Masculinity (MAS)
Versus its opposite, femininity, refers to the distribution of roles between the genders which
is another fundamental issue for any society to which a range of solutions are found.
The IBM studies revealed that (a) women's values differ less among societies than men’s
values; (b) men's values from one country to another contain a dimension from very
assertive and competitive and maximally different from women's values on the one side, to
modest and caring and similar to women’s values on the other.
The assertive pole has been called 'masculine' and the modest, caring pole ‘feminine'.
The women in feminine countries have the same modest, caring values as the men; in the
masculine countries they are somewhat assertive and competitive, but not as much as the
men, so that these countries show a gap between men's values and women's values.
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Individualism (IDV)
On the one side versus its opposite, collectivism, that is the degree to which individuals
are inter-grated into groups. On the individualist side we find societies in which the ties
between individuals are loose: everyone is expected to look after him/herself and his/her
immediate family.
On the collectivist side, we find societies in which people from birth onwards are integrated
into strong, cohesive in-groups, often extended families (with uncles, aunts and
grandparents) which continue protecting them in exchange for unquestioning loyalty.
The word 'collectivism' in this sense has no political meaning: it refers to the group, not to
the state. Again, the issue addressed by this dimension is an extremely fundamental one,
regarding all societies in the world.
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Is the extent to which the less powerful members of organizations and institutions (like the
family) accept and expect that power is distributed unequally.
This represents inequality (more versus less), but defined from below, not from above.
It suggests that a society's level of inequality is endorsed by the followers as much as by
the leaders.
Power and inequality, of course, are extremely fundamental facts of any society and
anybody with some international experience will be aware that ‘all societies are
unequal, but some are more unequal than others’.
Deals with a society's tolerance for uncertainty and ambiguity; it ultimately refers to man’s
search for Truth. It indicates to what extent a culture programs its members to feel either
uncomfortable or comfortable in unstructured situations.
Unstructured situations are novel, unknown, surprising, different from usual. Uncertainty
avoiding cultures try to minimise the possibility of such situations by strict laws and rules,
safety and security measures, and on the philosophical and religious level by a belief in
absolute Truth; 'there can only be one Truth and we have it’.
People in uncertainty avoiding countries are also more emotional, and motivated by inner
nervous energy. The opposite type, uncertainty accepting cultures, are more tolerant of
opinions different from what they are used to; they try to have as few rules as possible,
and on the philosophical and religious level they are relativist and allow many currents to
flow side by side. People within these cultures are more phlegmatic and contemplative,
and not expected by their environment to express emotions.
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This fifth dimension was found in a study among students in 23 countries around the
world, using a questionnaire designed by Chinese scholars It can be said to deal with
Virtue regardless of Truth.
Values associated with Long Term Orientation are thrift and perseverance; values
associated with Short Term Orientation are respect for tradition, fulfilling social obligations,
and protecting one's 'face'.
Both the positively and the negatively rated values of this dimension are found in the
teachings of Confucius, the most influential Chinese philosopher who lived around 500
B.C.; however, the dimension also applies to countries without a Confucian heritage.
The Pros
Trompenaars and Hampden-Turner provided a tool to explain how national culture differs
and how culture can be measured. Their research showed that cultural differences matter
and that reconciling cultural differences can lead to competitive advantage to companies in
consolidating / globalising industries.
Trompenaars and Hampden-Turner’s model gives employees who deal with cross-cultural
relations a tool/context to better understand value sets and behaviours.
Trompenaars’ research shows that the way business is conducted in one part of the world
is different from the way it is done in another. Culture is an important aspect in doing
international business. For example, Office Depot has learned that Japanese customers
do not like to buy their supplies in large, well-stocked stores that offer discount prices.
Japanese prefer stores where service is personal and are willing to pay higher prices for
this.
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The Cons
The model distinguishes the differences between cultures, but does not provide
recommendations on how to work with specific cultures.
Additional dilemmas may be added to the seven original dimensions of culture. No
assurance can be given that this list is complete.
Trompenaars and Hampden-Turner gathered data over ten years using a method that
relied on giving respondents dilemmas or contrasting tendencies. Each dilemma consisted
of two alternatives that were interpreted as indicators for basic attitudes and values. The
questionnaire was sent to over 15,000 managers in 28 countries. At least 500 usable
responses per country were received, enabling the two authors to make substantiated
distinctions between national cultures.
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INNER DIRECTED OUTER versus DIRECTED ACHIEVED STATUS versus ASCRIBED STATUS
The degree to which individuals believe The degree to which individuals must prove
the environment can be controlled themselves to receive status versus status
versus believing that the environment simply given to them. In a culture with
controls them. In an inner-directed achieved status, people derive their status
culture, people have a mechanistic view from what they have accomplished.
of nature; nature is complex but can be Achieved status must be proven time and
controlled with the right expertise. time again and status will be given
People believe that humans can accordingly. In a culture with ascribed status,
dominate nature, if they make the effort. people derive their status from birth, age,
In an outer-directed culture, people have gender or wealth. Here status is not based
an organic view of nature. Mankind is on achievement but it is accorded on the
viewed as one of nature’s forces and basis of the person’s being.
should therefore live in harmony with
the environment. People therefore adapt
themselves to external circumstances.
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Zeus
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Apollo
Bureaucratic Organisations
Hierarchical in Nature
Individuality means nothing
Following rules and regulations mean everything
Lacks creativity
Employees are over-managed and under-led
Resists Change
Slow at Communicating
Athena
Composed of Teams
Problem Solvers
“Can Do” Spirit
Brilliant when faced with new problems
Based upon ability and a desire for group success
Loves to experiment
Require heady capital investment
Do not always get ROI (Return on Investment)
Can be idealistic at times
Dionysus
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Final Word
In today’s highly competitive and globalised world companies are forced to compete on the
international stage under the guise of ‘Free-Trade.’
Not only have the forces of globalisation brought a new supply of products and services
onto domestic markets but it has also brought with it a new supply of labour.