Business Management scenarios have undergone a vast change within the last decades. Roles and Expectations in Corporate Management have been redefined following changes in perspectives of policy makers about the contribution of business enterprises towards a more sustainable development. Business Ecosystems comprising of all stakeholders who are dependent on each other look upon the manager as a leader who must incorporate these changes into the new management process instead of confining himself to the old stereotyped functions of planning, monitoring and controlling. This paper explores the role of the manager in the evolving business environment and the new responsibilities that await him.
Corporate Managers are the topmost leaders or business heads who were traditionally responsible for setting goals, defining visions and missions and developing a strategy for their organizations to achieve them. They also concerned themselves with monitoring whether these policies were being implemented as instructed and whether the units were following the roadmap towards realizing organizational objectives. They were also responsible for facilitating the resources for various business functions and controlling them on basis of periodic performance reports. The overall efforts of corporate management has been directed toward making workers more productive, simplifying processes and controlling the quality of outputs (Harmon, P. 2015, 38). Harmon has listed three business process traditions, the management tradition, the quality control tradition and the IT tradition in his study.
Progressive researches and concern of ethical and social observers initiated the evolution of management from traditional outlook to a more responsible role, a just leader who embedded the concept of value based organization. This concern led the emergence of the concept of corporate social responsibility (CSR) which has become mandatory for all public and private listed enterprises and is based on the rationale that all business units have the responsibility of paying back to the society a compensation for the resources utilized by it and for the ecological damage its activities may be causing. Caroll, A.B (1999, 290) has traced the evolution of CSR from 1950s and has summarized the issues under three themes until 1990- corporate social performance, business ethics and stake holder theory. Corporate management now extended its functions to a wider role of corporate social performance and ethical operations. A more detailed discussion of the evolution of social and ethical responsibility of a manager will be undertaken later in the paper.
With the advent of Information Technology, Corporate Management had another dimension in the functions it was expected to perform. IT had facilitated access to all sorts of information necessary to run a business as well as revolutionized the way business was conducted. Therefore the new corporate manager was expected to assimilate all information and use it for efficient performance of an organization. He had to adopt the digital methods of business transactions to maintain an edge over his competitors. His new role included leading his organization towards digital transformation.
In the present era, where there is a growing concern over sustainability of all resources, the new corporate manager is expected to move beyond the traditional roles that evolved over time and think of sustainable development of business where his concern should be directed towards using or replacing existing resources in such a way that the needs of future generation is not compromised in any way. However, experts are of the view that if present corporate managers limit themselves to the traditional roles of planning, facilitating monitoring and controlling, he will not be able to attend to the more significant role of forging new and external relationships that the evolving business ecosystem needs him to perform.
Responsibility of Top Management in the New and Evolving Business Ecosystem
New dimensions have been added to the role of top Management with the demands of changing business scenario. Business enterprises are required to show more accountability in economic, ecological and social components of business. Liberalization of policies for trade has made it imperative that corporate sector use these opportunities to expand their business out of their familiar area. The demand of the new business ecosystem dictates that managers spread their operating network beyond the boundaries of their organization to build external relationships. The external dimensions comprise of all the three components mentioned above. Even policy makers have observed frequently that top management show more involvement in social issues in an ethically symbiotic way. (Joyner, B.E. and Payne, D., 2002, 298) has highlighted the fundamental truth that business cannot function without society and society cannot progress without business. The new business Ecosystem; a modern term synonymous with industry because it displays the characteristics of a biological ecosystem where all stakeholders interact to survive, is of a dynamic structure which consists of an interconnected population of organizations, which both compete and cooperate for the resources (Peltoniemi, M. and Vuori, E., 2004, 280). It can be inferred from the explanation that business organizations coexist in a business ecosystem; hence a manager has to reach beyond his organizational roles to interact with the elements of an ecosystem failing which he may not receive external support. Managers can execute their organizational roles as part of the system but since the system consists of interconnected firms, those roles could extend to the system influencing the system fitness and through this the firm fitness (Anggraeni, E., Den Hartigh, E. and Zegveld, M., 2007).
Illustration1. Business ecosystem (Moore, 1996a)
The Modern manager must interact with all the participants shown in the figure to successfully realize organizational goals. Let us now focus on the specific roles that a new manager should take on to survive in the evolving business.
Enforcing Government Legislations – Business firms are under constant scrutiny from government and other regulatory bodies to confirm with certain legislations enacted to protect stakeholders from wrong business practices like discrimination, false and misleading claims, frauds and other illegal offences. Apart from the legal issues, ethical and social issues are also to be addressed by the new managers which consist of contributing part of business revenue to improve economic and social conditions of the less privileged sections of the society. Adherence to legal and ethical regulations by managers improves the credibility of the organization within the system and ensures a more respectable existence.
Responsibilities towards Stakeholders – All participants in a business system that have an interest in its successful operation are its stakeholders. Therefore stakeholders in a business comprise of investors, customers, suppliers, competitors, employees and social, legal and environmental authorities. It is the responsibility of the manager to ensure that all participants are rewarded justly for their contributions and involvement. This can be achieved through using all organizational resources optimally within legal and ethical framework to benefit all those who have an interest in its successful operation.
Role as a business competitor – Business competitors have to share many common resources like manpower, material, market, infrastructure and other facilities available in an industry. Since resources are limited competition is unavoidable. However a business ecosystem must be capable of creating niches and opportunities for new entrants. This requires a change in attitudes from protectionist to cooperative. Iansiti and Levien (2004) introduce four different roles that managers can take in business ecosystems like those of enablers, niche players, dominators and landlords. Enablers create opportunities for other firms while niche players take advantage of these opportunities for building new products or services. Dominators and landlords are usually large players who make the rules and employ maximum resources. Business competitors in the same ecosystem come across several common problems like economic recession, lack of infrastructural facilities, labor problems etc. Many researchers are of the view that business perspective is changing from competition to cooperation.
Supply chain Management – New drivers of business ecosystem like the internet and other social media demands that the manager perform the role of developing a supplier network. Suppliers are key components of a business ecosystem and the new IT innovations need to be implemented in supply chain management to make the system fast and efficient failing which organizations may become obsolete in modern business environment. Interconnectivity of suppliers through the internet and social media has become necessary for transaction in the new business world. Corporate Managers are supposed to facilitate the new technology to their vendors for interconnectivity. Gosain, Malhotra and El Sawy (2004) have observed that to manage their interdependencies, ‘enterprises need to encapsulate their interconnected processes in modular chunks, and support these with IT platforms for information exchange in structured formats’. Just as in a biological ecosystem, it is the fittest that survives in business ecosystem too, only those firms can remain functional that are equipped with interconnectivity through IT interfaces. Therefore the modern manager must adopt these interfaces to access, communicate and to facilitate resources faster without physical movement.
Reaching out to the Customers – Globalization of operations has made the jurisdiction of business ecosystems much wider than it was ever before and IT has made it possible for the stakeholders to be serviced faster. Liberalization of entry of business enterprises in many countries demands that the corporate manager not be confined to the head office only but moves throughout the world forging relations with new customers and collaborators for expansion of operations. Customers are perhaps the most important stakeholders in a business process who ensure continuity of business. Customer satisfaction is the objective of any business; prompt service and quality are the two fundamental elements of customer satisfaction. Globalization has made it easy to reach out to the customers through offices and service centers across the world. The general idea is that managers need to move beyond the local market and start thinking global. Global marketing also needs some research about difference in customer preferences across the world and managers have to focus on this for the right positioning of their product.
Organizational Role in the evolving Business Environment - The Modern Business environment has transformed the organizational culture hugely. And the core contributors – the work force in a business has experienced this change. The transition of the work force from conventional role to the modern role has to be introduced by the manager. He is the one who must prepare the work force to adapt them to the transformation. IT has changed the employment scenario as well. Conventional 9 to 5 jobs are being changed to work from home and online jobs. The new management has to adopt these new methods into their work processes. Outsourcing is also replacing the conventional recruitment of staff in an attempt for cost optimization. A gradual modification of roles and responsibilities in jobs from traditional methods to new practices has to be implemented by the new management.
Another emerging concept in the new management philosophy is the concept of lean management which is almost synonymous with value added management where every employee in the organization is engaged in adding value to the product or service till it reaches the customer. Mann, D. (2009) has stated that senior management has an important role in establishing administration that cross divisional boundaries, augmenting a thorough, futuristic vision of the firm’s value-producing operations, and making everyone accountable for achieving lean commitments. Lean management requires observation and implementation of a process from the customer’s perspective. The new management must consider this and change its perspective from that of the manufacturer to that of a customer.
Sustainable development by industries for conserving ecosystem is another responsibility that the new manager has to fulfill. Sustainable Industrial development philosophy advocates the use of resources in such a way that they are conserved for future generations. Corporate Leaders now have the responsibility to innovate or use renewable resources for preserving the resources. Shrivastav, P. (1995) has highlighted the role of senior management through four new concepts
(a) total quality environmental management, (b) ecologically sustainable competitive policies, (c) technology transfer in a nature protective way, and (d) reducing the effect of populations on ecosystems. The New managerial roles must focus on issues like controlling pollution of natural resources like air and water, depletion of resources like water, natural gas and petroleum, reducing wastage and the tendency to over stock and limiting the use of technology in favor of natural means.
Conclusion and Recommendations
The emerging concepts like business ecosystem, sustainable developments etc. have necessitated that role of top management be reviewed and redefined. Business methods have undergone phenomenal changes over the years with new innovations in products and processes. The senior manager has to respond to these changes both internally and externally to benefit the organization. Therefore there is a paradigm shift in his role of just planning, facilitating, organizing and controlling to that of innovating, interconnecting, developing and pursuing philanthropic activities.
The business ecosystem is governed by the same rule as that of biological ecosystem, where the participants compete and cooperate for the same limited resources. However, there has been a marked change from individual operation strategies to a more cooperative strategy perhaps owing to the fact that individuals in the same ecosystem are faced with many similar challenges such as scarcity of resources, economic sanctions, legislations and social accountability. The New Manager has to focus on his new role in this cooperative system and build external relations to strengthen internal operations.
Innovations in the field of IT and globalization have brought about an abundance of opportunities for organizations to expand their operations. The top management must take advantage of the internet platforms and social media to reach to customers throughout the world. Liberalization of entry rules has made it further easier to collaborate and merge resources and technology to work in a mutually beneficial partnership across different countries. The management must now explore the various avenues these opportunities have presented to stay in competition and build a more profitable network across the world for the firm.
Recommendations – On the basis of the above discussion the author recommends certain areas where the new manager should direct his attention in the evolving business system. (1) The Manager must concentrate on developing a network of suppliers and customers across the world using the internet platforms. (2) He should contribute towards social issues and introduce CSR in his business agenda as well as work towards incorporating ethical values in the organizational culture. (3) His efforts should be directed at promoting an atmosphere of external cooperation among all stakeholders including competitors by creating business opportunities in the ecosystem for a symbiotic coexistence. (4) There should be an intention of lean management where the customers are offered more value for the product they buy. This can be achieved by changing the perspective of the manager from that of a producer to that of the customer. (5) He should try to attain his business objectives within the framework of sustainable development; he must encourage and facilitate development of renewable and alternate resources for his business so as to conserve the existing resources for the future generation. (6). He should prepare the core contributors for transition to the modern business methods both externally and internally. Suppliers and Customers must be encouraged to adopt electronic methods for transactions and communication. Similarly employees may be trained to work online to give a more streamlined process.
References
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