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System Design & Management Analysis

SYSTEM DESIGN & MANAGEMENT ANALYSIS System Design & Management Analysis Veronica Brown-Corbin University of Phoenix Contemporary Systems Management MGT/736 Brian E. Polding, Ph. D March 12, 2007 System Design & Management Analysis Management must recognize the system design and management of an organization are subject to internal and external influences. The internal influences include the management team and employee; and the external influences can include competitors and customers. There are contextual/cultural factors and stakeholders that have an influence on the management system that is designed and implemented.

The contextual/cultural factors include key characteristics of the organization, internal and external relations, competitive landscape, strategic opportunities and challenges, and performance improvement. This is an opportunity for executive management to become acquainted with how these influences shape the organization’s context and maximize value for stakeholders. “Leadership’s job was to get the strategy right, design the correct structure, and then tie the strategy to structure through defined systems to deliver high-quality performance” (Nowicki & Summers, 2007, p. 118).

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This is not an easy process and takes time and input from several sources. The leadership in the organization has to guide the organization so that the goals and objectives are met. The performance of the organization will benefit from a well carried out strategic plan and management system. Senior management has the responsibility of developing system that that the organization operates within. “General systems theory provided a theoretical and philosophical framework for recognizing the openness of systems for developing information feedback to adapt and maintain a steady state.

From Wiener, cybernetics stressed that information feedback was essential to this adjustment. Organizations needed information; from systems theory came the notion that could, with some technological help, provide a means for communication and control” (Wren, 1994, p. 402). Management is responsible for developing a system that is beneficial to the organization. To be effective the system takes into consideration contextual/cultural factors and stakeholders. Effectiveness is determined by open and dedicated the employees are to the organization. All members of the organization have to be engaged in the process.

The stakeholders in the organization are considered as part of the process so that the management system will have a higher chance of being successful. “A management system is the framework of processes and procedures used to ensure that an organisation can fulfill all tasks required to achieve its objectives” (Wikipedia, 2007). Before the system can be designed there are factors that need to be considered and the role and identification of the stakeholders need to be determined. When an organization is designing a management system the role of the stakeholders must be identified because the system will have an affect on them. Before understanding the role that various stakeholders might play, it is important to identify them, define their interests and understand how those interests relate to your strategy”(Crossan, Fry & Killing, 2005, p. 65). The identity of the stakeholders has to be determined and they represent internal and external groups. “Externally, stakeholders include customers, competitors, suppliers, the community, government and a variety of interest groups” (Crossan, Fry & Killing, 2005, p. 65). Each of these stakeholders has their own interest.

However, the effect they would have on the organization’s system will be different. The products and /or services are directed to the needs of the customer. While the needs of the customer are important government requirements cannot be ignored and they can override customer needs. For example certain technology is in demand overseas, however, the federal government determines what technology is exported. Competitors can reduce market share and the system designed would have to take that into account. Suppliers would also be a factor to include when considering customers and competitors.

There are companies that suppliers are treated as partners because they have a close relationship with organization. When the supplier has been providing raw materials or other products they become part of the operation. For example, there are some Japanese firms that have partnered with their suppliers. The community and special interest groups can also have some influence on the system design for an organization. The influence they exert cannot be ignored. Being a corporate citizen in a community can be important especially when managers live in those communities. Corporate citizenship: For many, it remains a diffuse concept, but generally it speaks to companies voluntarily adopting a triple bottom line, one that takes into account social, economic, and environmental considerations as well as financial results” (Richardson, 2007, p. 92). When management designs a system its strategy and goals and objectives it will include its plan to participate in the community. These are areas that the organization can have some control and plan to integrate into its overall corporate strategy.

The amount of participation that can be provided ranges from supporting individual employees to the company creating foundation to reach out to a larger audience. “Internally, you need to consider employees, unions, the management team, investors and shareholders” (Crossan, Fry & Killing, 2005, p. 65). Each of these groups has a vested interest in the organization. They will also influence the management system that is developed for the organization. Management may have an advantage because internally they can have some control especially when it relates to employees.

The number of employees and departments can be controlled by management. Unions have been known to hinder the process but management can negotiate with the union that acts on behalf of the employees. “Employees have their jobs and usually their livelihood at stake; they often have specialized skills for which there is usually no perfectly elastic market” (Crossan, Fry & Killing, 2005, p. 116). Management has to consider the inducements employees need because they are internal stakeholders in the organization. The employee has the role of implementing the strategic plan for the organization.

The management team has the responsibility of developing the strategy and the goals and objectives of the organization. They also have a stake in the organization. “In short, management, especially top management, must look after the health of the corporation and this involves balancing the multiple claims of conflicting stakeholders” (Hartman, 2005, p. 118). Management provides the balance and creates value in the organization. The process is complicated as the leadership in the organization has significant data to analyze. At the same time executive management has to delegate some authority to the line managers.

Investors and shareholders are also part of the organization. An investor has provided a capital investment and they expect a return on their investment. Investors may not be shareholders and as result they do not have an ownership in the organization. “Shareholders are the owners of the organization, and, their claim on organizational resources is often considered superior to the claims of other outside stakeholders” (Jones, 2004, 2). The management system that is designed can be value-based. There are companies, such as Coca Cola, General Electric, and Abbot Labs, that have been successful when they engaged in value-based management. The companies have exhibited stellar performance, both absolutely and relative to their peers. Their shareholders have been rewarded with substantial increases in the equity holdings” (Morin & Jarrell, 2001, p. 9). The leadership in an organization can practice value-based management. Investors and shareholders want to see that their investment grow in value. Contextual factors also influence a management design. Contextual factors include key characteristics, competitive landscape, strategic opportunities and challenges, and performance improvement. Clearly the priorities of senior managers are important element of behaviour, but you will have to cast a wider net to capture all of the key behaviour that would be necessary to develop a new organizational capability” (Crossan, Fry & Killing, 2005, p. 150). Key characteristics tie closely to the understanding the culture of the organization. The culture of the organization cannot be ignored. “Organizational culture (OC) can be construed to cover almost everything in an organization: basic assumptions and beliefs, values, models of behavior, rituals, practices, symbols, heroes, artefacts, and technology (Gagliardi 1986; Hofstede et al. 990; Schein 1985)” (Livari & Husiman, 2007, p. 36). Failure to understand the culture of an organization can result in the development of a management system that will not work for the organization. The values and beliefs held by the organization’s leadership will be imitated by line managers and their employees. In a competitive landscape an organization cannot effectively compete in the market unless they know who their competitors are and what resources they will need to compete. If the competition is limited the company has an opportunity to become a market leader and capture a significant market hare. If there is significant competition, then the company has to find a way to be distinguished from all the others. A different strategy is needed because the circumstances are not the same. The system that is designed reflects the competitive environment organization operates within. Strategic opportunities and challenges can allow an organization to take advantage of a situation. It can have an impact on the type of leadership that would necessary. Different leadership styles are needed based on the strategy that is being followed by the organization.

The leader needed for organization undergoing significant change is different from a new company just starting out. The leadership provides opportunities to develop new and innovative methods for providing products and services to the customers. Management needs to carefully assess the environment to determine opportunities and challenges are present. A SWOT analysis maybe conducted to determine to identify the strengths, weaknesses, opportunities and threats that are present. These are all factors that can be in the design of management system.

Performance improvement is an issue that management has to constantly work on and it is not an easy task. The market is competitive and an organization does not keep its competitive edge for any extended period of time. Every organization can improve its performance. The market is constantly changing and management must be aware of the changes and how they will effect the organization. Failure to recognize the changes can have a negative impact on the performance of the organization. The leadership in the organization has to develop a strategy that will ensure the goals and objectives of the organization are met.

Getting input from all of the affected areas with also helps develop a system that meets the needs of the organization. Summary The system design and the management of the organization will contribute to the success or failure to meet the goals and objectives set for the organization. There contextual/cultural factors that need to be considered. The influences of the internal and external stakeholders have an impact on the development of the strategy for the organization. The system design and management will depend on the strategic plan for the organization.

The strategic plan will also determine the type of leadership that the organization will need. If the organization is making some significant changes then a transformational leader would be needed. The strategic plan will shape the organization. Input from the stakeholders also has to be considered because they will carry out the strategic plan. All this needs to be factored in the system design and the management of the organization. References Crossan, M. M. , Fry, J. N. , & Killing, J. P. (2005). Strategic analysis and action (6th ed. ). Toronto: Prentice-Hall. Hartman, L. P. (2005).

Perspectives in Business Ethics (3rd ed. ). New York, New York: McGraw Hill. Jones , G. R. (2004). Stakeholders, managers, and ethics. In (Ed. ), Organizational Theory, Design, and Change (4th ed. , pp. p. 2). : Prentice-Hall, Inc. Morin, R. A. , & Jarrell, S. L. (2001). Driving Shareholder Value Value-Building Techniques for Creating Sharehoolder Wealth . New York, New York: McGraw-Hill. Nowicki, M. , & Summers, J. (2007, February). Changing leadership styles. Healthcare Financial Management, 61, 2, 2. Retrieved 2/21/2007, from EBSCOhost Richardson, J. E. (2007). Business Ethics (18th ed. ). Dubuque, IA: McGraw Hill.


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