Learning Unit 5 Contemporary Issues in Management Outcomes

Learning Unit 5 Contemporary Issues in Management

Outcomes • Identify & discuss 5 major contemporary issues for managers in SA • Possible impact of these issues on SA organisations

Introduction • Our lives influenced by decisions made by businesses. • Interact with businesses everyday – Businesses have a major responsibility towards it’s stakeholders.

Stakeholders Customers Employees Suppliers Business Government Shareholders Larger Community

Shareholders vs. Stakeholders Stakeholder Claims Shareholders Dividends, capital growth of shares Employees Job security, promotion, training and development, salaries benefits, work environment Customers Value for money, safe products, customer service Suppliers To be paid promptly Community Clean air, local investment Government Tax Other Trade unions, pressure groups

Focus on issues • • • Ethics and social responsibility Globalisation New technology New world of work Increased power and demand of customers Learning in a new organisation

Ethics and social responsibility • Ethics: – Moral principles and values – Guide behaviour of individual or group – What is acceptable or unacceptable behaviour • Social responsibility: – Part of bigger community (system theory) – Protect society’s interests – Decisions lead to wealth creation

Ethical behaviour • Example of required ethical behaviour: – Honest, integrity, best of you ability – Fair, courteous, sensitive, respect rights – Accountable for actions and decisions – Behave above reproach – Comply to rules, procedures and regulations

Ethical behaviour – Use info the business in the manner which it was intended – Treat assets and property with respect. Do no waste resources or time – Share and declare info with possible conflict of interest – Refuse gifts as an attempt to influence you – Challenge others’ unethical behaviour and report it

Social responsibility • Interest group: – Indirectly influenced by management decisions. – Example: • • • ISS = Institute for Security Studies Research human security issues in Africa SAPS use information in ISS reports Thus, SAPS is an interest group of ISS responsibility: Ensure correct info for interest groups to use

Social responsibility • King 3 report on Corporate Governance: – Sound management decisions in SA – Company aware and respond to social issues – Place high priority on ethical standards – Non-discriminatory, non-exploitative and responsible towards the environment and human issues – If guidelines followed, business will experience increased productivity

Globalisation • Compete in any market globally/world-wide • Examples: – Coca cola: Globally to reach their goals – SA company expand to Africa – Relocation due to crime – Unskilled labour, look abroad

Globalisation • Philosophy = World is becoming homogeneous. – World is the marketplace not just locally

Key forces that drive globalisation Search for new markets High transport costs in own country Strike action in own country Extension of the product life cycle High labour cost in own country Goal of reducing production cost

New Technology • • More and more advanced Work from home E-mail and Skype Challenges: – Motivate when you don’t see? – Ensure delivery on time?

Technology breakthroughs • Breakthroughs: – Internet – Electronic commerce – Mobile computing • Managers and employees more mobile • Customers order and buy 24/7

New world of work • New world of work due to information technology • World is interconnected (systems and networks) • Increased access to info, org performance and other activities • Rise in technology Rise of new class worker The INFORMATION worker!

New world of work • Information worker = Always on, always connected • Pressure to be ‘always available’ – Cell phone – Skype – E-mail – Other connections

New world of work • Manage Stress-related illnesses • Knowledge-based work favours: – Strong non-routine cognitive skills – Problem solving – Communication – Collaboration • Training and education = life-long process

Increase power and demand of Customers • Customer can easily compare price, quality and availability. • Set criteria in terms of: – Cost and quality – Speed of delivery – Safety when shopping – Range of products – Availability and service - Convenience - Innovation - Customisation

Increase power and demand of Customers • Criteria has a direct influence on the business – Satisfy needs of the customer! • Traditional view = OUT! – Interactive and creative websites

Cheaper to retain than find a new customer! Increase power and demand of Customers • CRM = Customer Relationship Management – Methodologies and tools that helps business – To manage relationships with their customers • Includes: – Identify and target profitable customers – Generate sales leads – Individualise relationships with customers – Aware and act on future requirements – Altering behaviour of consumers

Other contemporary SA management issues • Unemployment/job creation • Crime • Poverty • HIV/Aids • Health in general • Corruption • Education • Development/ infrastructure • Land issue • Brain drain • Build houses • Other