CHAPTER 2 : STRATEGIC MANAGEMENT FROM ISLAMIC PERSPECTIVE

Islamic Management Conventional Management

1 Paradigma Guiding  No demarcation between  Clear demarcation between
Management Of the secular and the the secular and the religious;
Organization religious; human life is human activities are separated;
an organic whole; all spiritual or religious aspects is
human activity can be a private matter of individuals
Ibadah provided they are while work is in public
guided by Allah’s domain
commandments
2 Purpose Of Human  To obey and fulfill  To utilize natural resources to
Existence Dictating Allah’s commandments satisfy one’s needs, wants and
Management Of and act as the vice-gerent desires and to remain happy
Organizations of Allah on earth
3 Purpose Of Organization  Meant to be groups of  Meant to be groups of people
people coming together coming together to attain the
for attaining the purpose organizational goals.
of human exixtence
4 Nature Of Organizational  Both economic and non-  Both economic and non-
Objectives economic and are economic in nature and
compliant to larger compliant to organizational
purpose of human interest
existence
5 Source Of Ethics And  The revealed knowledge  Ethics is relative and values
Values Governing and the traditions of the are derived from multiple
Management Of Prophet constitute the sources such as upbringing,
Organizations ultimates source of society, and experiences.
business ethics and Ethics could be relative as in
personal values. utilitarian.
6 Organizational Control  Has to operate in a way  Has to operate in a way
designed to make the designed to align human
human being subservient objectives with the
to the will of Allah. organizational objectives.
7 Locus Of Control  Internal  External
 Each person is  Lies in the realm of the
responsible and organization
accountable for his
actions
8 Organizational  Human being has choice  Responsibility and
Responsibility and  Free will and freedom of accountability vested in the
Accountability action therefore is chief executive who delegates
responsible and it
accountable for all  Employees controlled through
actions organizational systems to
ensure responsibility and
accountability
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Objectives of Syariah (Maqasid Syariah)

In practice,

 It is permitted to take the property of other person if such thing can save his life. This is

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because life is prior than property.
 If someone want to bribe us with money ( property ) in order to get the tender, we should
not accept it because progeny or pride is prior than property.
 Prophet Muhammad (SAW) rejected gift and rank that offered by mushrikin in order to
persuade him to stop in preaching. This is in line with the concept of religion has a higher
priority than property

5 necessities,

 Religion
Life
Progeny
Intellect
Property
Maqasid on Company Social Responsibilities (CSR)

CSR is defined as denoting corporate activities beyond making profits

A set of standards of behavior to which a corporation subscribes in order to have a positive
and productive impact on society.
Islamic view of CSR :- holistic approach by offering and integralistic spiritual view based on
the