09/07/2014
Remuneration – Management Team
Managers are the link between the business owner and the subordinates as well as with other various stakeholders, therefore they are instrumental in determining the organizational mood which the subordinates can reflect to the customers’ in turn.
Before we engage in a detailed discussion of how a manager contributes to the success or failure of an organization we need to firstly understand the art of management.
I can define management as a process of accomplishing an objective through planning, organizing, leading, controlling, coordinating as well as continuous maintenance and upgrade of the available systems and resources.
This means that for a goal to be met someone has to do the planning and this entails putting mechanisms in place in order to take advantage of the opportunities and guard against threats.
After opportunities and threats have been identified, resources have to be put in place in a way that ensures the smooth flow of activities. Organizing therefore means the correct positioning of every resource in its respective place in order for it to achieve its intended objective.
When these resources have been put in their respective positions that ensures maximum benefit, there has to be a mechanism to ensure that every resource is measuring up to the set expectations. If there is a discrepancy, an investigation has to be carried out to find out the cause and make the necessary adjustments. This is called controlling.
People with the requisite skill and expertise are then selected to make sure that they set the pace and mood for achievement. This setting of pace and creating the good mood towards achievement of goals is called leading.
The people and other resources must be made to work together in a way that minimize friction and enhances efficiency regardless of inherent differences. This is called coordinating.
Put simply, a manager is a person who plans, organizes, leads, controls and coordinates the activities of a given entity for it to achieve its goals as explained in detail above.
Poor remuneration to such an individual can lead to poor products and services as well as inefficiency which in turn affects the profitability and reputation of an enterprise.
A business’s profitability hinges on increasing revenue and minimizing costs but however the ways and methods of minimizing these costs must be approached with care since sometimes cost reduction in the form of poor salaries for management can lead to poor product quality and poor service delivery as well as unscrupulous activities.
However some business people especially those for start-ups tend to enjoy the good life brought by increased business activities while forgetting those people who make it happen.
As the business starts to grow, the span of control increases as well as other activities and therefore the proprietor should find it worthwhile to proportionally reward those in charge of the business activities.
When the managers feel neglected and deceived from not receiving a commensurate reward, they may quit the organization or reduce their effort. When this happens the business will start to feel the pinch as most managers have an influence on staff members and stakeholders.
The three most common routes that poorly paid managers can take in an organization are:
1) To quit the job
2) To engage in corrupt activities
3) Poor performance.
Whichever route is taken is equally dangerous and can quickly lead to company’s closure.
When a manager quits, this can result in losing valuable expertise that was very instrumental in propping the business forward and this might cause you to engage an inexperienced or unqualified individual.
The engagement of a wrong or poor management team is dangerous to the well-being of an enterprise because of the lack of the necessary tactics to plan, organize, coordinate, control and lead the organization towards achievement.
Adapted from the book the SME Handbook written by Brian Kazungu