Business Management: Traditional to Breakthrough

Strategies and processes aim to manage business performance

Choose a strategy that focuses on a person’s core competencies, said the experts, and processes that ensure total quality management, and success will follow.

When technology and customer tastes change at an ever-increasing pace, what happens if core competencies become obsolete, modern managers wonder. This is particularly important when companies operate on a global scale and face competition from new players with unique costs and other benefits. Radically new methods of strategy development become essential in the new environment.

Management through the ages

With powerful labor unions, a press on constant alert, and increased public awareness facilitated by the Internet, modern business managers face a multifaceted set of concerns that go beyond mere profitability. Today’s business landscape requires attention to many dimensions, including social responsibility, ethical considerations, and sustainability. In the midst of these complexities, the role of corporations has expanded to include broader societal impacts.

In addition to these shifts, the digital age has empowered small businesses, enabling them to compete on an almost equal footing with their larger counterparts. As the level playing field increases, traditional business models evolve to accommodate these changes.

Similarly, in the field of education, students face different challenges and opportunities. The emergence of reputable article writing services such as KingEssays Enables students to excel in their academic endeavors. Just as companies must adapt to a changing landscape, students can benefit from expert help to navigate the complexities of coursework, ensuring they meet high standards of quality and learning.

business in ancient times

The business of making utilities and other artefacts would have begun as soon as humans learned how to use tools. Craftsmen produced things with their own hands and with simple tools. The individual artisan serves small communities whose members know where to go if they want a particular product. Skills were passed down from generation to generation in families specializing in particular trades.

Business transactions must take place on the basis of barter, that is, the exchange of goods and services for other goods and services, before the money can be used. For large projects, such as building the pyramids, slaves were often employed. Slaves were motivated by fear of punishment, such as flogging or even death.

Things have changed a lot since those days.

Changing business scenarios: trade unions, industrialization, labor studies, mechanization, automation

Artisans formed guilds that often limited the number of people accepted into the trade. Acceptance was through apprenticeship by master craftsmen. Competition in trade remained within manageable limits.

Manufacturing involves the use of capital equipment to produce things. This greatly increased productivity but also resulted in the production of products that were of inferior quality to artisanal products and to a deterioration in the quality of life for workers who often had to work long hours in squalid workplaces. The general poverty of the population left them no choice (as is the case in many developing countries until now).

Economist Adam Smith noted how productivity could be increased through the division of labor. Instead of having workers do all (or many) of the tasks involved in making a product if each worker is assigned to do only one task. It was found that productivity increased significantly.

“Scientific” management enthusiasts such as Frederick Taylor have studied business procedures in great detail. The bodily movements involved in performing the work were analyzed, and attempts were made to eliminate redundant movements and improve the effectiveness of the basic movements. This led to mechanization, first at the human level by training workers to work mechanically and then developing machines to perform repetitive tasks.

Assembly line factories in which workers perform repetitive tasks have changed the production scenario, increasing volumes and reducing costs. The process went further and human operators were often replaced by robots, automating much of the production line.

Business management has to deal with the increase in the power of workers

Movements against poor working conditions in factories and the rise of democratic societies eventually led to the emergence of strong trade unions and their bargaining with employers for better wages and working conditions.

Personnel management began to shift focus to human relations from a purely disciplinary approach. Researchers such as Abraham Maslow have explored the factors behind human motivation, and managers have used the findings to design work environments and practices that foster worker commitment. And this exercise continues in an ever-changing environment and growing understanding of how organizations operate. Organizational development is a major job now, and it requires significant redirections as knowledge workers replace manual workers.

Changes in the technology scenario and the social environment (which is often greatly influenced by technology) have had a significant impact on management practices. For example, information technology has accelerated business operations and business management software has provided business intelligence for strategic and management planning. The Internet has changed the scenario further as employees and employers, as well as the public, become aware of the business affairs of companies.

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The Small Business Administration has also transformed as small businesses can now operate on unprecedented scales using small business software and online commerce.

The impact of competition on management

In the early days of industrial development, it was a sellers’ market, where supply was often less than demand. Advertising essentially involved creating awareness among potential customers that the product is being manufactured or provided by the advertiser.

As the competition increased, the advertising scenario changed. In addition to creating awareness, the suppliers also had to convince the customer that their offer was the best. Practices such as monopolies and cartels emerged, as well as the art of writing persuasive sales copy and creative ways of promoting business.

Government business regulations change the scenario

Advertisements often make false claims that mislead potential consumers and seek to profit by manufacturing and selling unsafe and even harmful products. Monopolies and cartels stifled competition and harmed consumers’ interests. Business managers have adopted fraudulent practices to benefit themselves, usually to the detriment of the interests of the company as a whole.

All these practices have led to the proliferation of business regulations passed by governments. The government can no longer stand by and allow entrepreneurship to take over. Regulations affect all aspects of doing business today, from incorporation and stock issues, through employment, tax, health and safety laws, to senior manager accountability and privacy protection.

Organizational structure and development

The traditional top-down hierarchical organizational structure has proven inefficient to deal with the rapidly changing business environment as well as to create an environment conducive to innovation, which is a prerequisite for success in a highly competitive scenario. New forms of organizational structure that consolidate functions and speed decisions are developing.

Business management was thus transformed in dramatic ways, and the Egyptian pyramid builder was likely to be left baffled by new practices, such as dispensing with the whip to force workers to do work if it arrived in time.

The challenges of globalization and emerging technologies

Globalization has not only allowed companies to sell globally, but also to buy their needs at the lowest prices. Originally, this mainly meant purchasing raw materials, but as education and technology develop in developing countries, manufacturing and many incidental services can also be moved to these destinations to take advantage of lower costs.

Emerging new technologies, such as nanotechnology and modern biotechnology, have the potential to lower costs and create better quality products. These lower cost/better quality products can make traditional products and processes obsolete and uneconomical.

Business management systems are also being transformed. With business information freely available on the web, and the power of e-commerce, even a small business can do global marketing. Business software such as accounting and inventory management, and even a lot of hardware, can be obtained by paying usage fees in a cloud computing environment. Cloud computing not only reduces IT costs, but also enables access to private information from anywhere.

All of these changes make running a business a completely different challenge. Concepts such as core competencies and total quality management are becoming less relevant. Business managers may often find it best to get rid of their existing business and venture into a new one. This new idea was explained as breakthrough management by Dr. Shuji Chiba, who taught at MIT’s Sloan School of Management.

Strategic planning, organizational development and business management process

Strategic planning refers to the process of developing a business idea into a business. Choosing the company itself is part of the process. Traditionally, business selection has been based on core competencies, i.e. the strengths of the organization, and the external opportunities offered by markets and technologies.

Organizational development involves creating an organization that is able to meet the challenges it has to face. It includes selecting and training the organization’s personnel, establishing and maintaining a supportive organizational culture, and installing systems and procedures that act as lubricants to business processes, making them easy to implement.

Business process management refers to the manner in which business operations are carried out. It involves defining what needs to be achieved and how to achieve it, breaking it down into individual tasks, and following through on those tasks in the correct sequence. For a workshop supervisor or machine operator, who has clear and specific goals, this process can be simple. For the CEO given the task of achieving specific profitability targets in a competitive and uncertain market, the process will be very complex and will involve the strategic planning and organizational development processes mentioned above.

Business administration includes all matters related to starting and running a business, including management planning, organization development, technology – marketing – people, and business operations management. Business management practices have undergone drastic changes over the ages, and are changing even now to meet challenges such as globalization and rapidly changing technologies.