Revision -- management models

We can seen that from my previous posts , I did not writs any information about management model . In my view , that is a important factor which could affect a organization . The main variables will be identify in a situation that is the target of models, and models also aim to identify the relationships between them :the more accurately they do so , the more useful they are .Due to the situation is unique . So there are many types of management models .

In my opinion , the theory of  management model could be grouped as four parts -- classical management theory , human relations theory , non-human relations theory and system theory . Moreover , in this post , I will focus on the classical management theory .

Classical Management Theory 

The definition of classical management theory is that management takes place within a structured organizational setting with prescribed roles . It is directed towards the achievement of aims and objectives through influencing the efforts of others .

Henri Fayol was the first person to actually give a definition of management which is generally familiar today namely 'forecast and plan , to organize , to command , to  co-ordinate and to control '. In addition , Fayol also gave much of the basic terminology and concepts , which would be elaborated upon by future researchers , such as division of labour , scalar chain , unity of command and centralization .

Moreover , Max Weber suggest that the bureaucracy is the best way to run a organization . Bureaucracy could be defined as a system in which people are expected to follow precisely defined rules and products rather than use personal judgment . In terms the characteristics of bureaucracy management , initially , the behavious  of employees would be defined and controlled . The employees need follow these ensure uniform produces and operations . For example , the top manager to ordinate middle managers , and the employees will be controlled by the middle managers. Secondly , that is impersonality , because rules will lead to impersonality . In a organization which running by bureaucracy management , employees need to follow many rules . That mean's they will lack their own mind and decision . Furthermore , employees will lack of ability of creatively . New products is difficult to produce and provide. That is not good for a company's development , because attracting customers will be difficult . In addition , bureaucracy management also is hierarchical structure . There is a clearly structure . Each lower position is under the control of high position . For the positive side , that has a clearly structure . Therefore , each manager has different responsibility for different task and employees . Moreover , that is more easy to control the whole organization . For the negative side , that is not good for lower employees' development . Also , the top manager only can gain the comment and idea from the middle managers . However the lower manager and employees do not have an opportunity to communication with top managers .

Nowadays , many international company and organization pay attention on the culture of businesses and companies , such as Google , Apple and Microsoft . Also , companies more focus on the lowest employees . For example the company will provide opportunities to communicate with top manager , and invite one of lowest employees join their summit . Therefore , an increasing number of company use other management model , such as human relation .

To sum it , this is a management model that is bureaucracy which I want introduce to yours .

Globalization

What is globalization

Globalization refers to the increasing integration of internationally dispersed economic activities .The stands of globalization has three parts - Economic (that has a increasing trade across state boundaries), Cultural (westernization and homogenization ) and Political ( which is mean removal of borders, e.g. EU) .

In recent years , due to the developing of globalization , the world has become a smaller market . However , it also has some disadvantage . And then , this post will focus on the negative and positive effect of globalization .

In terms of the advantage of globalization , firstly , customer could gain more choice of products . Also, customer has a opportunity to buy a lower price product . In addition , the quality of products will increase , because the competition of companies . A company want to attract customers . Therefore , the company need provide high quality and low price product that also should be unique . Moreover , providing jobs and helping the developing country , such as India and Vietnam . Another advantages is that improving the standardization of products . The same products can be seen in the many places , such as Starbucks and McDonalds . Furthermore , the most important advantage is the integration of markets . That mean's markets are interlinked , such as European Union .

As regards the disadvantage of globalization , that will lead an increasing unemployment rate in developing countries ,such as moving call centers to India . In addition , there is a widening of gap between rich and poor countries . For example , the luxury bag is made by the citizen in the developing country , but the company which sale these bags just need pay the salaries to works in developing countries . However , the bags company could gain the large degree of profit . Further more , income generated in host country is not always spent in the same country . For example , the money earned from supplying cheap call centers in India will not be spent in India , but maybe in the UK or the US .
Thus , it could be conclusion as that the globalization bring some advantages . However , it also has negative effects .

International Business

International business also can be understand as the international trading .  There are some ways to conduct a business internationally .

Initially , outsourcing is a method to conduct businesses internationally . Outsourcing could be defined as that the practice of contracting out defined functions or activities to companies in other countries that can do work more cost-effectively . For example , Apple has outsourcing with Foxconn which is in Taiwan . Also , the accessories of iPhone is produced in many countries , such as Japan , China and Vietnam . The advantage of this way is that the cost of labour could decreased , because the wage of developing countries is lower than that of developed countries . Also , the work who is in the developing country do not have maximum working time . However , it also has some disadvantage. In my own opinion , the main negative effect is the cost of delivery.
The second way also is a common way that is exporting and importing . That is a type of dealing with overseas customers and suppliers is by transporting physical products ( raw materials or finish goods). Many international organization is developed by this way . For example , Starbucks has a lot of branch in the world . That is a way to make the business internationally . Further , that way also could built a good image of a business in the world through their product .

In addition , the third way is foreign direct investment . That mean's Investment from one country into another (normally by companies rather than governments) that involves establishing operations or acquiring tangible assets, including stakes in other businesses. The foreign direct investment has three types--horizontal , vertical and conglomerate .
-- Horizontal: where the company carries out the same activities abroad as at home (for example, Toyota assembling cars in both Japan and the UK).
--Vertical: when different stages of activities are added abroad. Forward vertical FDI is where the FDI takes the firm nearer to the market (for example, Toyota acquiring a car distributorship in America) and Backward Vertical FDI is where international integration moves back towards raw materials (for example, Toyota acquiring a tyre manufacturer or a rubber plantation). 
--Conglomerate: where an unrelated business is added abroad. This is the most unusual form of FDI as it involves attempting to overcome two barriers simultaneously - entering a foreign country and a new industry.  This leads to the analytical solution that internationalization and diversification are often alternative strategies, not complements.

There are other ways to conduct a business internationally , such as licensing , joint ventures , and wholly owned subsidiary .

Organization strategy and stakeholders

What is PESTLE analysis ?
PESTEL analysis is a technique for identifying and listing the apolitical , economic , social , technological , environmental and legal factors in the general environment most relevant to an organization .

PESTEL analysis is a simple and effective tool used in situation analysis to identify the key external (macro environment level) forces that might affect an organization. These forces can create both opportunities and threats for an organization. Therefore, the aim of doing PESTEL is to:

• find out the current external factors affecting an organization;
• identify the external factors that may change in the future;
• to exploit the changes (opportunities) or defend against them (threats) better than competitors would do.

In addition PESTEL analysis is also done to assess the potential of a new market. The general rule is that the more negative forces are affecting that market the harder it is to do business in it. The difficulties that will have to be dealt with significantly reduce profit potential and the firm can simply decide not to engage in any activity in that market.

Case

Political : stability of political environment , law, taxes , policies on economy , trading agreement . Starbucks had tax evasion .

Economical  : the currency rate will affect the cost and profit , because Starbucks had many opening stores in other countries overseas . Also they have some raw material from other countries . So , the currency rate will affect the cost of Starbucks .

Social : the Starbucks' store should be a goos "neighbours" . In addition , Starbucks should make the trade is fair .

Technology : customers can download Starbucks' app from app store . Moreover , the customer could order by this app , and sending the address to sales . And then the customer just need waiting the delivery . 

Environmental :Starbucks reduce energy consumption by 25% in 2010 , and purchase renewable energy equivalent to 50% of the electricity used in 2010 .

Legal : initially , Starbucks need fallow the employment law - working time , age and  minimum wage rate . For example , Starbucks CEO announcement that he's cutting his own salary from £1.2million to £10.000 per year.

Organizational Context

The organization context can be grouped as three parts -- internal , competitive(micro) and external (marco) environment .

In terms of competitive (micro) environment that is the most important knowledge in this part , a competitive environment is the industry - specific environment comprising the organization's customers , suppliers and competitors ( Boddy 2011). In addition , there is a porters which has 5 forces - a tool to help us analyze the micro environment . That is the power of buyer and supplier , threat of new entry and substitution , and competitive rivalry .

Case

Celine is a one of famous brand in the world . This company is focus on the clothe , bag and shoes . Moreover , it had become more popular since 2010 .

As regard the 5 forces of Celine , the first part is suppliers power . Celine has some suppliers , such as handmade company or studio . That mean's the supplier of Celine is fixed . However , that also mean's the company is difficult to change the supplier . In addition , the product of Celine is not similar with other brands' , because that has different design . The second part is buyer power .  The luxury market is a large market . Also , it had become more bigger . Celine  has many loyalty customers . There is a certain amount of order every year . In other side , the customer is fixed , and the target market of Celine is middle and upper class . Moreover , it is difficult to attract the new customers . The third part is threat of substitution . Due to the design and style , the threat of substitution of Celine is low . Further more , the fourth part is threat of new entry . It is expensive to enter this industry , because the experience needed , but training easily available . In addition , the luxury market is full . There are many famous and popular brands in the world  . So , new entry quite difficult . Finally , the last thing is competitive rivalry . Celine has many competitors , such as Chanel , Prada , Hermes and LV . Also , the switching cost is high , and the costs of leaving market also is high. However , there is high customer loyalty  . 

Organization structure & design

The topic in week 2 is about organization structure . However , I search and wrote some information about this topic in last post . So , I will focus on the detail of organization structure and organization design in this post .
In recent years, matrix organization had become the main organization in the world . For example , One of most famous company in the world -- Citibank -- is matrix organization . Also , the organization of Citibank could be defined as committee organization . Further more , A chart had shown below .

In addition , there is another more detailed chart .

For example , the CEO (chief executive officer ) of Citigroup is Michael Corbat . However , this organization has other two main managers - Jamie Forese & Manuel Medina Mora . They have responsibility in the different part . Jamie is responsible for each institutional business . And Manuel  focus on the oversea global customer . In more detail parts , there are also have managers to cooperation. Moreover , other managers also have opportunities to giving the idea and opinion to them . The CEO of Citigroup claim that is a good way to develop the organization .

By contrast , the organization of Apple during the time of Steve Jobs is different with the Citigroup . Apple was very focus on Steve Jobs as the leader and he would make all of decisions in apple and most of ideas came from him . Some people had a con to Steve Jobs organization structure is that the company often encounters the bottleneck situations of having ideas that are sources only from the leader and what ever Steve Jobs tends to have a habits of only focusing on one product at a time too much that the disregards the other products .

Another things I want talk about is organization design and culture .
In terms of the organization design and culture ,  every organizations have their own style and culture. Nowadays , many international organizations' culture are more humanity . For example , Pixar A himation Studios which is my most favorite company in the world has a special culture and style .

There are many interesting leisure area , such as pool room , game area and football field . Moreover ,  it also has some facilities for relax , such as spa room. Further more , the organization provide many delicious food that from different countries to employees . There have many positive influences . Initially , that could increase the motivation of employees . In addition ,  it also will enhance the creativity of workers , because when people in a relax atmosphere , that is more easy to acquire a new idea .

In addition , other organizations and companies such as Apple and Google also have a particular staff welfare . For example , if employee pass away , his families also can gain a part about 60% of the salary . That will support their living .

Thus , it could be conclusion as that every organization should decision and choose which structure is better for them . Further more ,  they also need found their won culture .

Organization

The word - organization - has a long history . For example , in the war , the army also can regarded as an organization . An army has many soldier ,  some leader and a general . Also, they strive and work for the same object .So, we can see that from this example , the organization has some common feature -people, target ,structure ,management and culture . In addition, nowadays , the source of organization can be defined as a group of entrepreneurs saw an opportunity in the market .And then created an organization to take the advantage of it (D Boddy , 2011) . For example , Sir Ka-shing Li invest Facebook at the start of this company about 4.5 billion dollar  . Now , the rate of return on investment is 560% .

The structure of organization 

In terms of the kind of organization , it has four different types -- hierarchy , committee/jury , and matrix .
In my opinion , a hierarchy is a basic organization type . A hierarchy has a leader who leads the other individual members . This organization like a pyramid , a sturdy base is needed in order to allow the overall structure to reach higher . However , this type also has a problem .  A chart had been shown below .We can see that from this chart , just 2 or 3 employees may have 2 manager .That mean's this organization will have a great management . But , it also create the waste of human resources . Moreover , the employer need spend more money on salaries .When the expenses increases , then , the profit will decreases .

The second type is committee or jury organization which is an association of people set up to arrive at solutions to common problems . It is a good example of democratic management, and every member has an equal opportunity to raise their voice and come to a common solution . However , in my opinion , this organization also has a problem . I believe that it will waste times in some cases . Majority of organization has committee organization . When a employee propose a new idea , but someone in this group disagree with it . That will waste a long time to discuss .

In addition , another type is matrix . This is a most popular types in recent years .The list of well-know companies that are using some form of a matrix is becoming long and impressive . For example , a company that has annual sales of 14 billion dollar and employs 400,000 people in scores of diverse business - General Electric . Because they have found the pyramid form cumbersome, so having turned to the matrix as a fundamental alternative . Other major corporations , such as Bechtel , Citibank , Dow Chemical ,Shell Oil ,Texas Instruments , and TRW , also have turned to the matrix organization .
Matrix organization also can be grouped as three types -Weak Matrix, Balanced Matrix and Strong Matrix .

Interestingly , when I take about organization , I believe that the first name that pops into people's head is company . Actually , non-profit organization such as charity also is an organization, because it also create the value to the world and some people . For example, WWF( world wild fund) is a organization which focus on protect animal and species . This organization will do activities to got the financial support , also it has some cooperative companies such AVON and Coca Cola Enterprises.

                                                    WWF in the UK

Further more , I found and learn another knowledge about organization , that I had learning in foundation course and business management lesson in last week . This is about the type of business company .
There also are four types - sole trader ， partnership，private limited company and public limited company.