Managing Profitability With Right Vision
The pressure and focus on bottom lines for a manager is tremendous. The manager spends the entire day in number crunching and taking decisions purely on the basis of optimum profitability. While this may seem quite good, the manager may actually be losing money for the organization by losing focus on a broader and more valuable aspect of vision and leadership.
World class organizations and managements are those that while being profitable have also a great vision. Everyone is very clear about the direction in which the organizations is headed and willingly contribute towards achievement of those goals and visions. The sharing of vision is so effective that most of the employees and more so the management believes that it is their vision and not the organizations.
None of these great organizations have bottom line as a vision or mission statement. The vision is something larger and so powerful that they result ultimately in healthy bottom lines.
A vision statement like ‘To Be The Best’. Let’s Do It’. ‘We Are in the Happiness Business’. None of these vision statements reflects profitability even remotely. If anything they do not even talk about their business. The vision talks about a philosophy. In fact they are so compelling and bold that they may actually be resulting in huge investments or short term losses to implement. However the powerful vision leads people to think their work is worthwhile. Millions of ordinary organizations with bottom line focus is not able to enjoy the kind of profitability that an organization with a compelling vision does.
Visioning requires leadership not management. Visions are also not for the squeamish and the weak. Visions are for the bold and the futuristic. Great visions entail a great leadership.
The world and the markets are drawn to great visions. It is a kind of force that generates immense attention and positive recognition from the markets, consumers and stakeholders. A Great vision unleashes a positive force, passion and energy shaping the organization into a force to reckon with.
The result is a great leadership, inspired managements and healthy bottom lines.
R.G. Srinivasan is a Certified Trainer, Writer and Author. He writes a regular blog on management thoughts which you may check out at http://management-thoughts.blogspot.com for interesting articles on management, managerial resources, strategies and experiences.
Sales Management and Managing Sales
For those engaged in sales management and trying to control a group of self-starter type sales people you can just imagine how hard it is. In all the commotion, chaos and controversy they have to manage in shear terror of handling all that is coming at them.
Indeed sales management is not for everyone and managing sales is certainly not as easy as it looks, nor is it suppose to be really. Managing on-going sales efforts for a fast moving company, which is fully engaged takes a lot of savvy, strategic planning and a love of the never ending fast-paced game.
It is not for the weak and you certainly do not want to put anyone in that position in your company who is of low self-esteem or without a strong sense of personal character. Quite frankly a team of sales people would eat them for lunch and spit out the bones and they would be running your sales department and eventually be serving their own self-interests rather than the forward progression and profitability of the company.
The go between we call sales management and manages sales is a special type of person and they are an instrumental part of any company. Sales Management folks who manage sales for your company must be of the highest integrity and must work for the company, the sales people and the sale. Consider all this in 2006.
Lance Winslow
Managing for Innovation – Values and Concepts of the Malcolm Baldrige Criteria Part 7
In this issue, I will share my experience acquired from the conglomerate and its operating companies. For the purpose of this article, I will articulate the Managing for Innovation which is one of the Eleven Values and Concepts in Malcolm Baldrige Criteria. As before, I will use case studies to show how some of the companies implement them.
To recap, below are the Eleven Core Values and Concepts of Baldrige Criteria:-
- Visionary Leadership
- Customer-Driven Excellence
- Organizational and Personal Learning
- Valuing Employees and Partners
- Agility
- Focus on the Future
- Managing for Innovation
- Management by Fact
- Public Responsibility and Citizenship
- Focus on Results and Creating Value
- Systems Perspective
I will deal with the one of the Value in bold letters in this article as below:-
Articulated Managing for Innovation:
What is Innovation in the context of Baldrige Criteria? As described in the Baldrige Criteria 2005, it means “making meaningful change to improve an organization’s products, services, processes, and operations and to create new value for the organization’s stakeholders”.
Strategically, Innovation should lead you to a new dimension of business performance. And it has to value add to the organization in terms increased in market share, capturing new customers and higher profit etc. It is not about research into new product or service which cannot be commercialized.
To be effective, organization should set direction and policy pertaining to innovation of product and service to an extent not to discourage such initiatives due to minor failure but to manage such activities to yield maximum results. Innovation should expend into supporting process to ease of doing business with customers
Case Study on Managing for Innovation
Most companies have some form of research and development into new products. To some, they are able to upgrade existing product for better or different applications. The level of focus on Innovation into new products is very much driven by the market or customer requirements. It is seldom in the case where it is done strategically to position ahead of competitors. Perhaps, it is a risk factor to be considered where “Total New” is certainly requires strong courage and good foresights. To play safe, some prefers to be a follower.
On Managing for Innovation, some adopted the “Trial and Error” approach in which innovation is performed based on pass experiences, feedback but existing skill and testing facilities. Investment into new or modern equipment and facilities often an hindrance to advance research and development of new products.
The implication to this approach results in loss of product cycle time thus new product launches is delayed. New product has numerous quality problems. Another aspect of Managing for Innovation is the support services to materialize the new product production. Production process is often taken for granted it can cope with new features of the new product innovated.
So far, innovation is confined to product and services at operation level. Innovation for new business model or business process are not focus point perhaps it has a higher risk to make changes.
Opportunity for Improvement
Organization need to fully understand the needs of the market and customer and predict their future requirement. Use such information to manage innovation for excellent performance. Key indicator to measure such initiatives should be established to monitor the progress and quality of innovations. Value-added measures should be included to measure Return of Investment for new product or services.
Company policies should be set up to encourage innovation. Though failure in innovation should be discourage, it should not have any penalty element in it. Such penalty element in the policy whether written or otherwise would damage innovation.
In summary, you may have noted the way I articulated Managing for Innovation. It merely describe its objectives towards business sense as this is the scope of my article. Having understood the Managing for Innovation in Values and Concepts of Malcolm Baldrige, it should be taken as a strategically for future business advantage. Leaders might benchmark their CEO of Baldrige Winners on their TQM successes in this value. My next article will articulate the next Core Values and Concepts in Managing by Fact
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Disclaimer:
All rights reserved. This article is written by the author based on his practical application experience. All definitions and interpretation of terminology are his point of view and has it has no intention to conflict with experts in similar topic. The author holds no responsibility for the use of this article in any way. Full Baldrige Criteria are available at http://www.nist.gov/quality
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Free to reprint or re-publish:
All rights reserved. You are free to reprint or re-publish this article as long as you include my resource box at the end of this article. And ensure that the URL in the resource box remained intact and it is linked to the author’s website.
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Resource Box: About the Author, LM Foong
The author provides consulting services specializing in TQM Implementations in manufacturing and service sector. He provides facilitation workshops and hands-on application in Cost Reduction and Productivity Improvement projects. He publishes TQM articles, ebooks, case studies, trainer manual and presentation slides. Please click