Control In An Age Of Empowerment Pdf Printer

When we praise creative employees, we generally don’t have in mind the Kidder, Peabody trader who booked fictitious profits and ultimately cost the company $350 million. On the one hand, employee initiative is more important than ever. Failure to nurture innovation and empower employees can lead to stagnation.

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But on the other hand, there is no shortage of cases where the zeal of an individual employee has crossed the line into harmful behavior. Failure to control employees appropriately, therefore, can lead to disaster: business losses, civil or criminal penalties, and perhaps most important, loss of reputation. This dilemma doesn’t require an either/or decision.

Managers can encourage innovation among employees while ensuring adequate control by using four powerful management systems or “levers.” The Idea in Practice How can you protect your company while promoting entrepreneurial flair? Think of control as embodying four distinct levers: • Diagnostic control systems are the traditional monitors of critical performance outcomes such as costs and revenues. But holding employees accountable for performance without having other monitoring systems in place can cause problems. Example: Nordstrom used diagnostic systems to track the performance of its sales force. But then some employees brought a lawsuit claiming that supervisors were pressuring them to under-report their hours on the job, so sales per hour would look better. Settling the claim cost Nordstrom more than $15 million.

• Belief systems encompass the company’s values, mission, and other statements of philosophy. When managers dismiss such beliefs, employees become cynical. However, managers who “walk the talk” and exemplify appropriate behavior have a powerful lever of control over employee actions. For example, Johnson & Johnson’s regular meetings to reaffirm its business credo proved invaluable in the search for solutions during the Tylenol crisis.

• Boundary systems are based on the “power of negative thinking.” If you want employees to be creative, don’t tell them what to do—tell them what not to do. Setting boundaries means establishing the rules of the game. Example: A large computer maker segregates business opportunities into green space—marketing segments where employees are encourged to innovate—and red space—those markets the company has decided not to pursue because they may dilute its competitive position. • Interactive control systems are especially important as organizations grow larger and senior managers have less personal contact with employees.

Using the interactive lever means sharing market information and encouraging creative responses while helping people avoid pitfalls. At USA Today, senior managers responsible for advertising revenue meet weekly with key subordinates to go over a packet of data on year-to-date and other measures of ad performance. Diagnostic systems represent the traditional approach of measuring progress toward goals.

The belief, boundary, and interactive systems add the elements needed to respond appropriately and profitably to today’s markets. When used in concert, these four levers can give you the control you need without sacrificing the flexibility and creativity you can’t do without. Resetter Epson L120 Free more. A fundamental problem facing managers in the 1990s is how to exercise adequate control in organizations that demand flexibility, innovation, and creativity. Canon Lbp 5000 User Manual.

Competitive businesses with demanding and informed customers must rely on employee initiative to seek out opportunities and respond to customers’ needs. But pursuing some opportunities can expose businesses to excessive risk or invite behaviors that can damage a company’s integrity. Reseter Printer Canon Pixma Mp258. Consider the spate of management control failures that have made headlines in the past several years: Kidder, Peabody & Company lost $350 million when a trader allegedly booked fictitious profits; Sears, Roebuck and Company took a $60 million charge against earnings after admitting that it recommended unnecessary repairs to customers in its automobile service business; Standard Chartered Bank was banned from trading on the Hong Kong stock market after being implicated in an improper share support scheme.