Globalization.
The
cliché that the world is getting smaller is dramatically true for
today’s organizations. With rapid advances in technology and
communications, the time it takes to exert influence around the world
from even the most remote locations has been reduced from years to only
seconds. Markets, technologies, and organizations are becoming
increasingly interconnected. Today’s organizations have to feel “at
home”
anywhere in the world. Companies can locate different parts of the
organization wherever it makes the most business sense: top leadership
in one country, technical brainpower and production in other locales. A
related trend is to contract out some functions to organizations in
other countries or to partner with foreign organizations to gain global
advantage. Organizations have to learn to cross lines of time, culture,
and geography in order to survive. Companies large and small are
searching for the right structures and processes that can help them reap
the advantages of global interdependence and minimize the
disadvantages.
Ethics and Social Responsibility.
Ethics
and social responsibility have become some of the hottest topics in
corporate America. The list of executives and major corporations
involved in financial and ethical scandals continues to grow. Pick up
any major newspaper on almost any day, and the front page will contain
news about some organization embroiled in an ethical scandal. This is
corporate corruption on a scale never before seen, and the effects
within organizations and society will be felt for years to come.
Although some executives and officials continue to insist that it is a
few bad apples involved in all the wrongdoing, the “man on the street”
is quickly forming the opinion that all corporate executives are crooks.
The public is disgusted with the whole mess, and leaders will face
tremendous pressure from the government and the public to hold their
organizations and employees to high ethical and professional standards.
Speed of Responsiveness.
A
third significant challenge for organizations is to respond quickly and
decisively to environmental changes, organizational crises, or shifting
customer expectations. For much of the twentieth century, organizations
operated in a relatively stable environment, so managers could focus on
designing structures and systems that kept the organization running
smoothly and efficiently. There was little need to search for new ways
to cope with increased competition, volatile environmental shifts, or
changing customer demands. Today, globalization and advancing technology
has accelerated the pace at which organizations in all industries must
roll out new products and services to stay competitive. Today’s
customers also want products and services tailored to their exact needs.
Companies that relied on mass production and distribution techniques
must be prepared with new computer-aided systems that can produce
one-of-a-kind variations and streamlined distribution systems that
deliver products directly from the manufacturer to the consumer. Another
shift brought about by technology is that the financial basis of
today’s economy is information, not machines and factories. One result
of concern to organizational leaders is that the primary factor of
production becomes knowledge, to which managers must respond by
increasing the power of employees. Employees, not production machinery,
have the power and knowledge needed to keep the company competitive.
Considering the turmoil and flux inherent in today’s world, the mindset
needed by organizational leaders is to expect the unexpected and be
prepared for rapid change and potential crises. Crisis management has
moved to the forefront in light of terrorist attacks all over the world;
a tough economy, rocky stock market, and weakening consumer confidence;
widespread ethical scandals; and, in general, an environment that may
shift dramatically at a moment’s notice.
The Digital Workplace.
Many
traditional managers feel particularly awkward in today’s
technology-driven workplace. Organizations have been engulfed by
information technology that affects how they are designed and managed.
In today’s workplace, many employees perform much of their work on
computers and may work in virtual teams, connected electronically to
colleagues around the world. In addition, organizations are becoming
enmeshed in electronic networks. The world of e-business is booming as
more and more business takes place by digital processes over a computer
network rather than in physical space. Some companies have taken
e-business to very high levels to achieve amazing performance. These
advances mean that organizational leaders not only need to be
technologically savvy but are also responsible for managing a web of
relationships that reaches far beyond the boundaries of the physical
organization, building flexible e-links between a company and its
employees, suppliers, contract partners, and customers.
Diversity.
Diversity
is a fact of life that no organization can afford to ignore. As
organizations increasingly operate on a global playing field, the
workforce—as well as the customer base—is changing dramatically. Many of
today’s leading organizations have an international face. People from
diverse ethnic and cultural backgrounds offer varying styles, and
managing diversity may be one of the most rewarding challenges for
organizations competing on a global basis. For example, research has
indicated that women’s style of doing business may hold important
lessons for success in the emerging global world of the twenty-first
century. Yet the glass ceiling persists, keeping women from reaching
positions of top leadership.
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