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Management Restructuring


The management of Winning Moves depends on the central power source from its founder, Paul Bishop.  Harrison (cited in Handy, 1999) calls this as a power culture.  The characteristics of power culture conform to Paul・s behaviour, for example recruiting right people who can think in the same way as him; control is exercised by himself, directions depend on his decisions, etc.  Handy (1999) warns that a .spider web・ like this can break if it seeks to link too many activities.  Paul also notices this problem and understands that the consequent result is the limited growth of the company. 

 

To solve the problem, the management must be restructured to reduce central control and promote greater flexibility and employee autonomy.  This can be achieved by the cooperation between Paul and his managers.

 

Paul

 

Effective management restructuring requires a consideration of the redistribution of power.  This would be a difficult decision for Paul as he favours central power.    However, Lawrence and Lorsch (cited in Handy, 1999) argue that with diversity (due to increasing size of the company), top management like Paul cannot expect to be in possession of all the relevant information or technical knowledge.  Decisions must be delegated to those who can take them.  For example the Operations Director, Howard Lane, should be empowered to make decisions related to operations.  Paul should endeavour to lower the decision-making levels and increase the power of the middle levels of management.

 

In order to achieve the desired results from empowerment and delegation, Paul should learn to trust his managers.  This would be a dilemma as what Handy (1999) argues: control costs money but trust is risky.  With the old ways of management, Paul only needs to spend time (time is equal to costs) to monitor, check or control the work of the employees.  In contrast, with the new ways of management, trust is cheap as Paul would step back to do other things.  But Paul might feel empowerment and delegation as a risky action for the possibilities of misplaced and abused of power by the managers. 

 

No matter what, Paul should understand that the situation does not allow him to operate the company with a power culture anymore.  The central control mechanism would only create tendency for the employees rely on him solely and hinder organizational growth.  With trust by means of empowerment and delegation, Paul can be freed to do other important decisions such as dealing with visions, crisis, organizational structure and policies, etc.  On the other hand, the managers can handle the daily operations and decisions of their own divisions with empowerment and delegation.  This can also promote greater flexibility and employees・ autonomy as managers are held accountable for their works.

 

Paul might choose to restructure the management of the business in sequential way.  For example, Paul might release his control and empower/delegate managers on certain activities first to build trust.  Once both he and the managers are confident, Paul can increase the decisions powers of the managers slowly.  If there are any problems, Paul should provide feedback to the managers for improvement.  Any changes of power must let all the employees know, and clarify of roles and reporting systems in order to be effective.

 

Middle management

 

Handy (1999) warns that trust is a fragile and therefore must be reciprocal.  So when Paul is willing to trust the managers, in return they should also trust Paul.  The managers must always live up to the trust invested in her/him if that trust is to continue.  For example, they must deal with care and should be responsible for any decisions they make for the company.  Although there is no more central control, the managers should report to Paul timely ensuring that everything is in good progress as his expectation.  Management by objectives (MBO) is a useful mechanism for empowerment and delegation.  It is because both Paul and the managers can agree on the definition of the territory of trust; an agreed specification of desired results; a programme for action initiated by the managers (Handy, 1999).  This can reduce central power, and at the same time, it can promote greater flexibility and employee autonomy.

 

As a conclusion, Paul・s power culture with central control is no longer valid with the growth of the company.  He should restructure the management of the business by empowerment and delegation to his managers.  This way can help him to reduce central power and step back to make important decisions; while providing flexibility and autonomy to the managers.  However, trust is important for this new management structure and therefore, it needs the cooperation between Paul and the managers.


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