NAME: BADRU OLUWASEGUN SOLOMON

PG NO: PG191578945818

COURSE TITLE/CODE: BUSINESS ORGANISATION AND

ADMINISTRATION (MBA 815)
INTRODUCTION

Management practices usually refers to the working methods and innovations that managers use
to improve the effectiveness of work systems. Common management practices include:
empowering staff, training staff, introducing schemes for improving quality, and introducing
various forms of new technology. An entity of instruments to support implementation of
concepts and ideas at all levels of conceptualization and realization of concepts, ultimately aiming
to support organizational processes.

MANAGEMENT PRACTICES IN SELECTED COUNTRIES

JAPAN

The management system in Japan is deeply rooted in historical traditions, some of the other key
practices commonly associated with Japanese management techniques include:

Ringi System

The traditional decision-making process in Japanese firms is referred to as the ringi system. The
system involves circulating proposals to all managers in the firm who are affected by an
impending decision. Proposals are generally initiated by middle managers, though they may also
come from top executives. In the latter case, an executive will generally give his idea to his
subordinates and let them introduce it. Managers from different departments hold meetings and
try to reach an informal consensus on the matter. Only after this consensus is reached will the
formal document, or ringi-sho, be circulated for approval by the responsible managers.

The ringi system requires long lead times, and thus is problematic in a crisis. In recent years the
focus on speeding up decision making has made this approach unpopular at many firms.
Nonetheless, one of its underlying principles remains prevalent. That is, when a decision proves
beneficial, the middle-level managers who initially advocated it receive credit; when a decision
proves unsuccessful, responsibility is taken by top-level executives. This practice is intended to
promote aggressiveness in younger managers.
 • in-house training of managers
• consensual and decentralized decision-making
• extensive use of quality control methods
• carefully codified work standards
• emphasis on creating harmonious relations among workers
• lifetime employment and seniority-based compensation

Just-in-Time Production

In the rest of the world, manufacturers made their components "just in case" they were needed.
They filled bins, pallets and warehouses with days' or even weeks' worth of costly parts, which
gathered dust until they were finally needed. The Japanese started making components "just in
time," with parts arriving just as they were needed on the production line.

Bottom-Up Decision Making

Although decision making in Japanese companies is bottom up, the power of the typical Japanese
CEO is so great that no important decision can be made without first considering his wishes.
While proposals are likely to start from lower-level executives, these executives generally
propose what they believe to be the wishes of their superiors. This pattern of decision making is
prevalent all the way down to the lower echelons of management. In other words, the bottom-
up process merely disguises the true decision-making pattern, which generally runs from the top
down.

Enterprise Unions

One distinctive management practice in Japan is the enterprise union, which is organized around
a single plant. Consequently, any given company may have several enterprise unions
representing various portions of its workforce. Enterprise unions generally belong to a larger
federation, but the balance of power is at the local level. Japanese unions are distinct not only
because of their highly decentralized nature, but also because they represent both white-collar
and blue-collar workers, with union membership open to managers up to the section chief level.
The fact that many upper-level managers have moved up through union ranks and may have
even served as union officials highlights the generally less antagonistic relationship between
labor and management in Japan. Combined with a relatively narrow income gap between
managers and workers and the willingness of manager recruits to work on production lines as
part of their training, the open membership policies of Japanese unions contributes to the fairly
harmonious interaction between unions and management. Union membership is generally
associated with lifetime employment guarantees. Membership varies widely by firm size, and
relatively few workers in firms with fewer than 100 employees receive lifetime employment
guarantees. Nonetheless, in large firms the lifetime employment guarantee creates an
environment in which workers are less likely to feel threatened by technological change. As a
consequence, changes in the production process are likely to be undertaken by management and
workers on a cooperative basis. More generally, since semiannual bonuses and annual wage
negotiations are based on a firm's competitive strength, workers have a large stake in their firm's
long-term success.

Use of Quality Circles

The extensive use of quality circles is another distinguishing characteristic of Japanese

management. The development of quality circles in Japan in the early 1960s was inspired by the
lectures of American statisticians W. Edwards Deming and J.M. Juran, in which they discussed the
development of wartime industrial standards in the United States. In Japan, quality circles consist
of groups of about 10 workers who meet weekly, often on their own time. The groups typically
include foremen, who usually serve as circle leaders. Quality circles focus on concrete aspects of
the operations in which they are directly involved, using tables and graphs to communicate the
statistical details of their quality issues. In one common format, problems are categorized by
materials, manpower, and machines. Quality circles provide a means for workers to participate
in company affairs and for management to benefit from worker suggestions. Indeed, employee
suggestions play an important role in Japanese companies. Two associations, the Japanese
Association of Suggestion Systems and the Japan Human Relations Association, were developed
to encourage this process. Japanese employee suggestions reportedly create billions of dollars'
worth of benefits for companies.

GERMANY

German management, as it has evolved over the centuries and has established itself since World
War II, has a distinct style and culture. Like so many things German, it goes back to the medieval
guild and merchant tradition, but it also has a sense of the future and of the long term. Some of
the features of Management Practices in Germany are:

Rigorous Style of Competition

The German style of competition is rigorous but not ruinous. Although companies might compete
for the same general market, as Daimler-Benz and BMW do, they generally seek market share
rather than market domination. Many compete for a specific niche. German companies despise
price competition. Instead, they engage in what German managers describe as
Leistungswettbewerb, competition on the basis of excellence in their products and services. They
compete on a price basis only when it is necessary, as in the sale of bulk materials like chemicals
or steel.

Management Objectives

The German management practice concentrates intensely on two objectives: product quality and
product service. He wants his company to be the best, and he wants it to have the best products.
The manager and his entire team are strongly product oriented, confident that a good product
will sell itself. But the manager also places a high premium on customer satisfaction, and
Germans are ready to style a product to suit a customer’s wishes. The watchwords for most
German managers and companies are quality, responsiveness, dedication, and follow-up.

Co-Ordination with Government

Another feature of the Management Practice in Germany is cooperation or at least coordination
with government. German industry works closely with government. German management is
sensitive to government standards, government policies, and government regulations. Virtually
all German products are subject to norms–the German Industrial Norms (Deutsche Industrie
Normen–DIN)–established through consultation between industry and government but with
strong inputs from the management associations, chambers of commerce, and trade unions. As
a result of these practices, the concept of private initiative operating within a public framework
lies firmly imbedded in the consciousness of German managers.

UNITED STATES OF AMERICA

America is one of the most advanced nations of the world. America is infact, leader in modern
management techniques. The economy of America is a free economy and people lead their lives
freely without much social checks and barriers. They want to lead independent life and are
accustomed to the ‘hire and fire’ style of management. Employment on contract basis started in
America, which is being followed by other countries of the world. The features of Management
Practice in the United States of America are:

Quick Decision Making

Process of decision making is quite fast and it is undertaken on individual basis. Decisions are
taken at different levels of management by the people or superiors operating at these levels.
Decisions are made primarily by people and usually only a few people are involved. Consequently,
after the decision has been made, it has to be sold to others, often to people with different values
and different perceptions of what the problem really is and how it should be solved. In this way,
the decision-making is rather fast, but its implementation is very time-consuming and requires
compromises with those managers holding different viewpoints. The decision that is eventually
implemented may be less than ideal because of the compromises necessary to appease those
with divergent opinions. It is true that decision responsibility can be traced to people, but at the
same time, this may result in a practice of finding "scapegoats" for wrong decisions. In all, the
decision power and the responsibility is vested in certain people in U.S. companies, while in Japan
people share both decision power as well as responsibility.

Individual Responsibility and Accountability

The system adheres to bureaucratic and formal organisational structure with the specific line of
individual responsibility and accountability. Organizations in the United States emphasize
individual responsibility, with efforts to clarify and make explicit who is responsible for what. Job
descriptions are perhaps the best evidence of this. Many organizations, especially those
operating in a stable environment, have been rather successful in using the formal bureaucratic
organization structure. As far as the climate is concerned, not many managers make special
efforts to create a commonly shared organization culture. This may indeed be difficult because
professionals-managers as well as technical people-often have a closer identification with their
profession than with a particular company. In addition, the work force often consists of people
with different values derived from diverse heritages. Many U.S. companies have a high employee
turnover rate, which is partly due to the great mobility of the people in this country. With a
relatively short duration of employment with any one company, the loyalty toward the company
is at times rather low. Organizational change is often accomplished by changing goals instead of
processes. But organizations using change agents with a behavioral science orientation may focus
on interpersonal processes to reduce conflicts and improve performance. In the United States it
is quite common to use outside organization development consultants.

Performance Appraisal

Promotions in American companies are based on individual performances. Annual performance

evaluation is undertaken select the most efficient workers. A common practice in U.S. companies
is to appraise the performance of new employees comparatively soon after they are hired. If
performance does not meet the company's expectations, employment may be terminated. But
even for those who have been with a company for many years, performance is evaluated at least
once a year and in many cases their performance gets reviewed periodically during the year. In
general, the focus of performance appraisal is on short-term results and individual contributions
to the company aims. Moreover, differentials in pay increases are often based on individual
performance. These differences in pay may be substantial, especially at upper levels of
management. Promotions in U.S. companies are based primarily on individual performance.
Although progressive companies provide continuous development, training is often undertaken
with hesitation because of the cost and the concern that the trained person may switch to
another company. Thus, employees are often trained in specialized functions resulting in a rather
narrow career path within the company. Finally, in many U.S. companies, employees feel that
they may be laid off during economic hard times which, naturally, contributes to job insecurity.

INDIA

The Indian economy is ranked 55th out of 140 world economies. This overall economic ranking
according to the Global Competitiveness Index is a significant improvement as India has climbed
16 places in comparison with its previous ranking. Dynamics of many in-dicators are positive, but
for some areas need improving. Very positive trends have been recorded in areas of institutions
where ranking is improved by 10 places, and infrastructure has gone up 6 places. Some of the
features of Management Practices in India are:

Family Promoted Businesses

Unlike other countries, Indian companies are largely led by family promoters. Indian
entrepreneur tends to stay with his business till the end. In India, it is also a norm for the
promoters' children to take over the business, which is less common in the US or other western
countries. The legacy issues are much stronger here than in any other country.

Dexterity

Another unique feature about Indian Management Practice is the dexterity required to operate
a business here. If you can operate a business in India you can do so anywhere. It's not that Indian
managers are inherently more creative than their counterparts elsewhere. But they operate in a
complex, often volatile environment with much red tape. They, therefore, have to be nimble
footed to be able to move with a constantly-changing and evolving policy framework, low quality
of infrastructure that reduces smooth flow of physical and financial capital, corruption,
bureaucratic procedures that increase transaction costs - all hurdles for doing business in India.

Low wage and Benefits

The Indian management system is also characterized by low wages and benefits for employees.
This explains why employees in India are not always motivated to perform optimally and always
looking to move out of the country to other places where they can get better pay for work done.

UNITED KINGDOM

Some would argue that since industrialization is a rational, orderly process, striving for universal
efficiency with standardizing effect, managers would clearly be the same sort of people doing the
same kind of things in the same ways. This assumption could be extended to the companies
themselves. Manufacturing companies, these generic units of industrialization, would be much
the same with regard to their structure and general features wherever they are located. At any
rate, this would be true for countries at the same stage of industrial development having the
same sort of political system. For example, organisations throughout Western Europe operate in
similar contexts and under the same pressures which would lead towards uniformity. The
accelerated volume of trade within Europe and increasing collaboration and overlapping
ownership between EU organisations would, naturally, lead to the establishment of a common
‘Western European management’ style. The features of Management Style in Britain are:

Individualism

The origins of individualism, independent thinking and self-confidence in England should be

traced long back into history. The ‘protestant ethic’ and the spirit of capitalism were, in fact, the
major driving forces behind the Industrial Revolution. Britons have a high regard for liberty and
independence. Hence, they have cultivated a strong entrepreneurial mentality and flair. This is
illustrated in the laissez faire economic context which they established for more than two
hundred years, and which opposed government interference and supported unrestricted
economic liberty and free competition. Consequently, the English had traditionally developed
considerable competences in dealing with export markets and responding to foreign competitors
and to a flood of imports without going bust or requiring immediate trade protection. The
surprising successful development and expansion of franchising in England is a clear reflection of
this distinctive capacity of the British entrepreneurs.

Decentralization

Bigness provides vital economies of scale, financial resources and muscle in the market. However,
today it is more flexibility and responsiveness that matter for success. The argument of size is no
longer all-pervasive6. Moreover, recession in the early 1980s made corporate restructure
necessary for survival. British companies responded with leaner and fitter structures as well as a
move towards decentralization. SBUs were the most obvious manifestation of this transition. The
application of decentralised management, in contrast to functional management, encourages
autonomy and entrepreneurship and helps to motivate people by making them better informed,
more responsible and giving them more control. Thus, UK companies witnessed their managers
engaging in initiatives and nurtured the managerial talent they needed. Decentralization has
been proved especially appropriate in sectors which are subject to rapid technical or market
changes, notably services. In retailing, initiative – innovation – adaptation are by far more
significant factors of success than control and economies of scale, providing, thus, a strong
argument in favour of decentralised structures and approaches to management which UK
enterprises have mastered exceptionally well over the past two decades.

Democratic Management Style

There is a wide agreement that control in British business organisations is relatively dispersed. In
other words, the ‘democratic style’, also referred to as ‘participative’ or ‘semi-constitutional’ is
the prevalent one in British firms. It can be reflected on the fact that subordinates are consulted
in decision-making and are given wide opportunities to exercise discretion in their work. Contrary
to the autocratic, paternalistic approach that German firms share, top management in UK
displays a willingness to delegate to lower management and counts on the subordinates’ strong
sense of responsibility. Even in the case of UK’s small, family-run firms (where a paternalistic
pattern is supposed to emerge), British managers (and owners in most cases) do not portray a
pure autocratic style, but rather a mixture of democratism – autocratism, which is referred to as
‘sophisticated paternalism’. Thus, UK’s family businesses manage to retain a decentralised
decision-making approach while upholding their distinctive social ethos and religious dissent.

NIGERIA

Nigeria management practices reflect the core values of African culture. These core values
include extended family, human relations orientation, co-prosperity or social mutual concern,
respect for elders and tradition, consensus, competition and hero-worship. The Nigerian
management practices indicates a managerial style that shows a high concern for people,
production and a system where decision-making is by consensus. The model offers an explicit
concept for structuring the character of participation within each phase in management decision-
making. In Nigerian organizations, the importance of clan or ethnic interests over individual
needs is manifested in different ways. Some of the management practices in Nigeria include:

Quota System or Federal Character

In Nigeria, quota system and catchment area policies are taken into consideration during
recruitment exercises, admission into universities among others, where a fixed number (quota)
is assigned to each state or the local government area (catchment area) that is on advantage
location to the institution bring competed for. Later, a selection of candidates is made based on
the quota system and catchment area policies.

Life Long Employment

Another feature of Nigerian Management Practice is lifelong employment. Employees in Nigeria

are allowed to work for a minimum of 35 years or until they are 60 years old. This aids Job security
and reduces the level of unemployment in the country.
Contingency Approach to Management

Contingency approach also known as situational approach, is a concept in management stating

that there is no universally applicable set of management principles (rules) by which to manage
organizations. Organizations are individually different face different situations (contingency
variables), and require different ways of managing. Contingency approach remains less common
than change management approaches. The contingency approach management is a view that
the organization recognizes and responds to situation variable as they arise. The contingency
approach, which can be seen as an extension of the systems approach, highlights possible means
of differentiating among alternative forms of organization structures and systems of
management. There is no optimum state