1. Identify and discuss three key performance measurement lessons top management should learn and understand from Baker’s engine and transmission example. First of all, we can learn from this example is that manager cannot think the performance of whole is simple sum of the performance of each of the parts considered separately. One plus one is not makes two. One plus one is greater than two in Baker’s concept. Executives should view the system as a dynamic process. The each unit and individuals in system are interdependent and interact. Secondly, the traditional system of employee feed back and evaluate should be changed. Executives cannot just evaluate employee depend on individual performance but should evaluate employee as a person who associate with a whole organization and work in system. The thinking that each individual person and unit is urged to best so that the whole will become its best and the each individual will makes greatest contribution to the company is not rational. Thirdly, the system of work post responsibility should follow with system management principle. In the traditional management concept, individual just deals with his “ work” and just care about his “responsibility”. In the baker’s view, the responsibility of each individual should be relates to whole organization and whole system. 2. You have heard me describe the “Baker Model” as follows: Assumptions drive structure, structure drives behavior, and behavior drives results. A. What are the assumptions, structures, behaviors, and results that will likely follow from a MBO (Management By Objective) type of management philosophy? a. MBO Assumptions:
Most company attempt to maximize the benefit of shareholder and put it to the first goal of organization. MBO (Manage by Objects) is the management philosophy that was generated by this goal. MBO’s primary assumptions is that managers define each individual's major areas of responsibility in terms Of results expected of him and use these measures as guides for operating the unit and assessing the contribution of each of its members based on the object of organization. b. MBO Structure:
MBO philosophy will lead to profit-oriented organization that may have a central management structure. Management process based on MBO allocates their goal to the employees from the central top to the department then to the individuals. The first phase in the MBO process is to define the organizational objectives. These are determined by the top management and usually in consultation with other managers. After the organizational goals are defined, the subordinates work with the managers to determine their individual goals. c. Behaviors of MBO
By understanding the psychology of human beings, these philosophies may easily result in certain employee behavior. People are more likely to be competitive rather than being cooperative with each other. They may be lack of creativity and just obey to the directions, acting like a machine without better ideas, aspirations, or reflections on their situation. Employees are highly stressed and won’t pay enough attention on establishing relationship with others, not to mention create interactions. They just care about themselves’ goals and benefits instead of the whole company’s healthy growth, let alone natural and social responsibility of the enterprise. For instance, if the process can lead to the result, there may be real best workers and worse workers. Only those best workers will be appreciated and get attention. Most of other workers will not be inspired because they feel they can never surpass those stars of the company. If the system have problems and never generate settled goals, all the workers may lose motivation to achieve the goals. That’s the failure of MBO philosophy unless the top managers can make the process work well by ignoring any other human intelligence from the employees. d. MBO Results
Owners of the business widely accept the financial...
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