The role of constituents in the traditional management process and the systems approach method
The criticality of identifying a ‘proper’ role that is well adjusted to the relevant environment, is an extremely important act and could be a determinant of success or otherwise in any organization. Such a definition would not only form the basis of evaluating capabilities of person for the role, but also assessment of performance. Such an effort would commence from this declared or identified role and compare actual achievement apropos that role. Inadequately described role will result in sub optimal performance which would prove to be expensive in the long run. Additionally, comparison of performance with an inappropriate role definition could yield misleading outcomes where performance is good but overall results are unsatisfactory.
Traditionally the role of a particular function is defined by what it does, irrespective of the context. Like a scientist carries out an experiment in a laboratory, far away from its native environment, we in our regular management practice tend to do the same with role definition process. However, when we conceptualize reality in terms of systems comprising inter connected elements, we cannot ignore the context. Roles, in this approach, are described with full cognition of the context in which these are expected to operate. The process for doing this is fairly simple. We study the containing system (context) and identify its objectives. Role comprises those responsibilities that the element needs to perform to achieve the system’s overall objectives. If all of these sounds a tad confusing let me elucidate the point through examples.
Role Definition of the purchase department in a manufacturing organisation
The Purchase department in any manufacturing organization is engaged in procurement of goods and services, at the best price and at the right time. Motivational incentive for staff of this function is designed around this activity. The department sees itself as the people who get the prices down and effectiveness is judged by the extent of reduction. To that extent the first quoted price is recorded and compared with the final price that is arrived at after several rounds of negotiations and the difference used as indication of the efficacy of the Purchase department. A ‘progressive’ Purchase function may even suggest an alternative to the end user so as to minimize costs or time required and so on.
However, once we bring into focus the context, a variety of interesting nuances emerge. Let us, for the purpose of this article, discuss one aspect of the role that derives from the context. The Purchase department is one function that is at the frontier of the organization and interacts, extensively, with outsiders. This position gives it a unique opportunity and a special place within the organization. It is the first organizational element that experiences changes that others within will experience after some time. In today’s environment early availability of information acted upon suitably often leads to competitive advantage and being the one at the boundary this department is in a good position to collect such information and convey it to the relevant people within the organization. Awareness of imminent changes or modification in technologies or any particular strategic thrust of vendors, suppliers or OEMs could have an influence, big or small, on the working of a customer organization and it is the purchase department’s positional role to be a conduit for such information and disseminate the same to pertinent officials within.
Instances of modification in role deriving from a systemic perspective is rampant, even if not always recognized or practiced. Consider the case of the Finance function in an organization. Expectation from this department is to maintain accounting (both Financial and Cost) records, manage funds, keep track of cash flow, interface with shareholders and financial institutions, keep records as per regulatory requirements, execute management decisions, etc. If you interact with Finance officials you will discover that they always seem to have over flowing cup of woes. Being the last link in the whole chain before it is made public or scrutinized by senior officers all errors made by other departments emerge and need necessarily to be addressed at that stage. This is one of the sources of their woes as is the fact that engineers take decisions without due consideration of the financial ore economic aspects. Such actions inevitably result in unfavorable outcomes and as a consequence of which CFOs often has to face the wrath of external stakeholders.
Outcomes, such as these, are direct results of roles as defined in any traditional management exercise that is oblivious to the containing larger system. Once a holistic perspective is brought in, however, the role would be suitably modified to adjust for reality. Given the actual situation described above the role ought to include, in fact it should have a significant proportion of, training of executives in financial practices. While this may not appear to be a very large matter it would make an enormous difference to the organizational performance on certain issues. Errors committed are seldom because of mala-fide intent but invariably out of sheer ignorance. I recall once the in-charge of Excise function was disturbed and accused production engineers of my department of not adhering to certain conditions. I immediately discussed the matter with my engineers, only to learn that they were not even aware about the rules they have purportedly broken. Those who are familiar will know that several actions, vulnerable to interpretation was always predominant in satisfying the requirement of this department.
These two very simple examples highlight how introducing a holistic perspective alters the role that has been defined using traditional methods. An intelligent reader will appreciate that this altered perspective does not merely lead to a modified role statement but introduces a qualitative difference in the way the role is viewed. Let us spend a few minutes on the two cases. In a world where knowledge and information play pivotal roles in the success of competing organizations any action that actually feeds this information into the organization will boost the overall capability of the organization.
[author title=”Prashun Dutta” image=”http://”]Prashun has around 35 years of varied corporate experience, former CIO at Reliance Infrastructure and Tata Power, an Electrical Engineer and a fellow in Management of the IIM(C). He is well known for his contribution to the electric utility sector where the systems implemented by him at RInfra and Tata Power have been adopted throughout the country. He is now a freelancing consultant to corporates.[/author]
