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Executive Summary
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Management has been a constantly evolving philosophy that has been in
development since the beginning of written history. Throughout the
centuries and millennia, leaders, philosophers, and organizations have
sought to create paradigms that comprehensively and coherently deal with
real-world issues. It should be noted that management, as with all other
sciences, is in a constant state of flux and evolution, based upon the
realities, principles, and market conditions prevalent at that time. At
the advent of the 21st century, the business community has been witness to
change and corporate reengineering at a scale never seen before in human
history. Globalization, advances in technology, and a new, determined
focus on the bottom line has led to the demise of many businesses, and
forced others to shrug off old ideas and processes for more innovative
ones.
Technology has played a critical role in
the transformation of global organizations. Technological knowledge
doubles approximately every three years, and in the last 100 years, the
world has amassed more knowledge, technology, and information than all of
the collective knowledge in human history previous to it. This
exceedingly rapid pace of change has presented opportunities for companies
that are capable of reacting quickly and efficiently, and has been the
death-toll for those who cannot. Ideas like customer relationship
management, e-procurement, and XML-based transactions through real-time
databases have provided fledgling companies with the weaponry to devastate
competitors that are ten times their size, and have permitted monolithic
corporate leviathans to utterly dominate their respective markets.
Wal-Mart is a classic example of the latter. In the late 1980s, a small
group of engineers located in a previously unknown corporate office in
Arkansas were given the opportunity to integrate Wal-Mart's procurement
and ordering facility into a web-based, XML- enabled application that
could interact with vendors and distribution sites in real-time. In doing
so, Wal-Mart revolutionized order processing and nearly removed human
error and guesswork from the ordering process. Now, each Wal-Mart
location has a real-time database of all its goods and their respective
quantities. When these items reach a predetermined level, a database
kicks off an application that determines how much of the product to
order. It factors in variables like warehouse space, amount sold in the
last cycle, historical sales for the upcoming cycle, and so many other
factors that listing them would be useless. This application then sends
an XML - wrapped request to its vendor, and automatically places the order
though the internet. The vendor has its inventory reduced by the amount
of the order, and the purchase order is slated for delivery.
In an environment that has seen the capitulation of competitors such as TJ
Maxx, K-Mart, and Marshall's, Wal-Mart continues to thrive. However, it
would be difficult to attribute the success of this organization merely to
technology; many other factors affect the success, or failure, of any
company. To embrace technology is not enough; without the ability to
adapt to change and embrace new processes, corporations of today can
suffer the agonizing death of stagnation. Common to many of the top
leaders of global organizations is the belief that the only constant in
the business world is change. The ability to adapt efficiently, quickly,
and without hesitation is coercing corporate entities to redefine
processes, realign business units to match such processes, and flatten the
management structure. However, even this will not be enough.
Organizations must resist the temptation to speculate that a process
change will somehow repair organizational problems; no such process will
do, for change is omnipresent. Change processes will never end, for the
dynamics of the new business climate will never cease to change, and
corporations will be obliged to adapt to the challenges of tomorrow as
they have adapted to the challenges of today. The ability to adapt to
change, and that process of adaptation, must become a core foundation of
businesses of today.
There has been a focused approach to business management in academia; the
"Four Functions of Management" are a cornerstone of the analysis of
business management and corporate practices. These functions have played
a key role in the development of the new corporate world; they have
identified strategic operations within organizations that are suspect to
negligence. Armed with this knowledge, corporate entities have
streamlined and reorganized poor processes, and have focused on the health
of a corporation through a combination of leadership and controls.
However, these functions are a reaction to business models that have
served the business community in the 20th century. They are a legacy to
our past; an important and valuable legacy, but a legacy nonetheless. As
technology progresses, and as global economic conditions continue to
change, so will our interpretation of these ideas, as well as their
application. Businesses cannot subscribe to the belief that any set of
functions, no matter how well-founded in theory or application, can
explain or determine success. In the business world, the only constant is
change. Paradigms must change. Old processes must be cast off. New
ideas and new entities and new theories must fill the void. The only path
to success is innovation. |