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SHIPMANAGEMENT

Ship management deals with the process of managing a ship. Ship


management is done by independent companies which use ships of some
other companies or independent owners. The ship management company
manages ships for the owner and pays him the yearly amount which is settled
between the owner and the ship management company.
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The owner of the ship signs a contract and leases the ship to the ship
management company for a defined duration of time. The ship owner may
continue with the same management company or can approach another
company if the he is not satisfied with the performance of a particular ship
management company. It is to note that the owner can lease the ship
completely or he can render some of the services provided by the ship
management companies.
2
Managing ships is not an easy task. Ship management includes
several tasks which are to be carried out before, during and after the
operation of the ship. The first and foremost thing that a ship management
company needs to do is get the ship approved. There are many approvals
that are to be taken from different classification societies. owever, the
company can operate different types of vessels or !ust concentrate on any
one type. "or e.g. MS# $Mediterranean Shipping #orporation% deals with only
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http://www.marineinsight.com/marine/what-is-ship-management/
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ibid
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container vessels, whereas companies like & ships, 'nglo()astern manages
all types of ships.
*
"ollowing are the services that a ship management company is entitled
to provide+
,
1% The ship management company should do the supervision of the
maintenance of machinery on board the ship. The process should also
include different surveys and repair work of the ship.
2% The ship management company should provide ade-uate crew for
manning the ship.
*% The company should arrange for loading and unloading of the cargo.
,% The ship management company can hire the ship on behalf of the
ship owner.
.% The company should negotiate the contracts for bunker and lube oil.
/% The ship management company pays the e0penses on behalf of the
owner.
1% The ship management company should make an arrangement for
the entry of the ship in the 23 I $2rotection and Indemnity% association.
4% The company also deals with various claims related to insurance,
salvage etc.
5% The ship management company should arrange for the insurance in
relation to the ship.
16% The ship management company7s services also include
arrangement for providing victualing and stores for the crew of the ship.
3
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4
Ibid
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THIRD PARTY SHIP MANAGEMENT
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Ship operation is increasingly a speciali8ed and technical business,
which is often these days undertaken by specialist ship management
companies. These, typically will not own the ships themselves, but will
contract to operate them, manage and maintain them, and provide the
detailed technical management to keep them operating efficiently.
The contract between manager and ship owner will specify the degree
of the management that will take place. The ship owner may wish to trade the
ship himself9 alternatively he may wish the manager to undertake full
commercial operation of the ship, organi8ing the insurance, the purchase of
stores and full technical maintenance and operation, along with the provision
of a properly trained crew. In such cases the manager will treat the ship as his
own for the period of the contract, ensuring that it is always available, and
maintained in good condition.
Third party ship managers will contract to do anything the owner
wishes. The owner may wish to keep the operation and technical
management :in(house; but will hire the manager to undertake the often
difficult < functions in relation to the crew. ' competent ship manager will
always have access to seafarers. The fee that the ship manager earns will
reflect the depth of the management task he contracts to undertake. The
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https://www.bimco.org/en/Education/Seascapes/Questionso!shipping/"hatis3rdpart#shipman
agement.asp$
*
owner of the ship placed with managers will receive regular financial and
technical reports on the vessel.
There are numerous advantages in employing ship managers, not least
the ability to outsource many difficult and labor intensive elements of ship
operation and management. It is an arrangement that suits an industry where
demand for ships and shipping is notoriously cyclical. It also enables an
owner of perhaps !ust a few ships to operate them without the need for a large
in(house organi8ation. Moreover, placing this small fleet with a si8eable ship
management company will generate the advantages of being with a large
fleet, such as e0cellent purchasing power for stores, repairs and other matters
which the large manager will be able to obtain. 'nd as the operation of ships
becomes more heavily regulated, the demand for these :ships7 husbands;
$which they were called in the past, continues to grow.
Something like one third of the world7s fleet is in the hands of ship
management companies, which themselves have been innovative in
developing sophisticated systems of management. There is brisk competition
between management companies, so that there is always an incentive to be
more efficient and innovative. Many of the larger management companies are
highly regarded, developing methods of running ships more efficiently,
organi8ing the training of their own staff and providing a fine career structure
for professionals ashore and afloat. 'nd as shipping itself becomes more
speciali8ed, the managers are developing accordingly, able to provide
specialist services for every kind of fleet.
,
=utsourcing ship management services to third(party service providers
can help shipping companies enhance their operational efficiency in running
the day(to(day operations of the vessel.
/
There are a wide range of activities involved in the management and
operation of a ship, which can include maintenance engineering, vessel
crewing, -uality system management, safety system management, integrated
logistics support, property management, inventory control, and procurement.
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Ship managers and ship owners strike an agreement as to the scope of
power the manager holds. Some shipping companies for instance, turn over
full control of the ship>s operations to the third(party ship management
provider. This gives ship owners the chance to focus on their core
competencies, and find ways to improve their business.
4
Ship owners can also choose to transfer control of specific marine
operations, such as vessel crewing, and even shore(based activities such as
logistics support.
5
?hen choosing a ship operations and management company to run a
fleet, it>s always important to choose a company with e0tensive e0perience in
the field. 'side from having the e0pertise and e0perience that newer
companies do not have, they are also likely to have a larger network of
contacts, which is useful when finding new crew for vessels or procuring
items.
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Ibid
7
Ibid
4

16
Ibid
.
More e0perienced companies also provide better ship management
services because they have a firmer grasp of the e0tensive international
regulations and standards that oceangoing vessels need to be in compliance
with. ' number of more established ship operations and management firms
can handle the full range of vessel management and ship building services.
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HISTORY OF MANAGEMENT
DEFINITION OF MANAGEMENT
Traditionally, the term @management@ refers to the activities $and often
the group of people% involved in the four general functions+ planning,
organi8ing, leading and coordinating of resources.
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Aote that the four functions recur throughout the organi8ation and are
highly integrated. )merging trends in management include assertions that
leading is different than managing, and that the nature of how the four
functions are carried out must change to accommodate a @new paradigm@ in
management.
1*
INTERPRETATION OF MANAGEMENT
'nother common view is that @management@ is getting things done
through others. Bet another view, -uite apart from the traditional view, asserts
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Ibid
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http:// library.upmin.edu.phC...management/History%20of%20Management.ppt
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that the !ob of management is to support employee>s efforts to be fully
productive members of the organi8ations and citi8ens of the community.
1,

To most employees, the term @management@ probably means the
group of people $e0ecutives and other managers% who are primarily
responsible for making decisions in the organi8ation.
1.

In a nonprofit, the term @management@ might refer to all or any of the
activities of the board, e0ecutive director andCor program directors. Some
writers, teachers and practitioners assert that the above view is rather
outmoded and that management needs to focus more on leadership skills,
e.g., establishing vision and goals, communicating the vision and goals, and
guiding others to accomplish them. They also assert that leadership must be
more facilitative, participative and empowering in how visions and goals are
established and carried out. Some people assert that this really isn>t a change
in the management functions, rather it>s re(emphasi8ing certain aspects of
management.
1/

SCIENTIFIC MANAGEMENT THEORY (1890 1940)
't the turn of the century, the most notable organi8ations were large
and industriali8ed. =ften they included ongoing, routine tasks that
manufactured a variety of products. The Dnited States highly pri8ed scientific
and technical matters, including careful measurement and specification of
activities and results. Management tended to be the same. Frederic T!"#$r
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developed the :scientific management theory; which espoused this careful
specification and measurement of all organi8ational tasks. Tasks were
standardi8ed as much as possible. ?orkers were rewarded and punished.
This approach appeared to work well for organi8ations with assembly lines
and other mechanistic, routini8ed activities.
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%&REA&TIC MANAGEMENT THEORY (19'0 ( 1950)
Ma0 ?eber embellished the scientific management theory with his
bureaucratic theory. ?eber focused on dividing organi8ations into hierarchies,
establishing strong lines of authority and control. e suggested organi8ations
develop comprehensive and detailed standard operating procedures for all
routini8ed tasks.
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H&MAN RE)ATIONS MANAGEMENT THEORY (19'0 ( TODAY)
)ventually, unions and government regulations reacted to the rather
dehumani8ing effects of these theories. More attention was given to
individuals and their uni-ue capabilities in the organi8ation. ' ma!or belief
included that the organi8ation would prosper if its workers prospered as well.
uman <esource departments were added to organi8ations. The behavioral
sciences played a strong role in helping to understand the needs of workers
and how the needs of the organi8ation and its workers could be better
aligned. &arious new theories were spawned, many based on the behavioral
sciences $some had name like theory :E;, :B; and :F;%.
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&NIT I
TYPES OF SHIP MANAGEMENT STY)ES APP)IED %OTH IN THE
PHI)IPPINE DOMESTIC SHIPPING AND INTERNATIONA) SHIPPING
SETTING*
5
1+1 A&TOCRATIC MANAGEMENT STY)E
'n 'utocratic Management Style is one where the Manager makes
decisions unilaterally, and without much regard for subordinates. 's a result,
decisions will reflect the opinions and personality of the manager, which in
turn can pro!ect an image of a confident, well managed business. =n the
other hand, strong and competent subordinates may chafe because of limits
on decision(making freedom, the organi8ation will get limited initiatives from
those @on the front lines@, and turnover among the best subordinates will be
higher.
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The Geader will make decisions and outcomes based on hisCher own
!udgments and ideas alone, the manager will not take any advice or direction
from any of his employees or co(workers. Therefore the 'utocratic Manager
cuts a powerful and knowledgeable figure, making sure everything is done
e0actly to their liking without compromise, no(one would -uestion or suggest
any changes to the leader, he wouldn7t listen anyway.
21
There are two types of autocratic leaders+
a directive autocrat makes decisions unilaterally and closely supervises
subordinates
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http+CCen.wikipedia.orgCwikiC'uthoritarianHleadershipHstyle
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http+CCwww.typesofmanagement.netCautocratic(managementC
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a permissive autocrat makes decisions unilaterally, but gives
subordinates latitude in carrying out their work
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AD,ANTAGES OF A&TOCRATIC MANAGEMENT
?hen decisions need to be -uick and decisive, an 'utocratic Manager
is your man, dishing out fast, forceful orders leaving no(one in doubt
who is in charge or which direction they all should be pulling.
2*
?ith one figure head at the top, it leaves no(one in any doubt who7s in
charge, so there7s no e0cuse for lack of communication.
2,
The 'utocratic Manager will seem knowledgeable and e0perienced this
can reassuring for the staff.
2.
DISAD,ANTAGES OF A&TOCRATIC MANAGEMENT
?ith the 'utocratic Manager making all the decisions unilaterally, the
staff could be made to feel useless as they know their inputs or ideas
will not be listened to or even considered by the Geader.
2/
The staff may always be looking to the Manager for direction or
inspiration9 this can lead to poor initiative among the staff and even
slow productivity down by waiting for instructions from the boss.
21
'n 'utocratic Manager can start a Ithem versus us7 mentality between
the Management and Staff, leading to poor morale and less obedience.
22
http+CCen.wikipedia.orgCwikiC'uthoritarianHleadershipHstyle
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http+CCwww.typesofmanagement.netCautocratic(managementC
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The Manager could become overworked and stress due to having to
make all the decisions, if the manager become over(stressed, it could
cloud his decision(making, affecting the business.
24
Sometimes problems can be solved when looked upon by a fresh set
of minds9 this would not happen in an autocratic leadership
environment.
25
E-AMP)ES OF A&TORITHARIAN )EADERS
'dolf itler was e0tremely authoritarian.
e re-uired the population of the Third <eich to
accept everything that he said as absolute law,
and was able to impose a death sentence on
anyone who failed to do so. itler was obsessed
with being in control, and with being the alpha
male in a rigid male dominance hierarchy.
*6
'utocratic leadership style works well if the leader is competent and
knowledgeable enough to decide about each and everything. 'uthoritative is
considered one of the most effective leadership styles in case there is some
emergency and -uick decisions need to be taken.
*1

Jill Kates adopted this style and has steered Microsoft toward great
success. 'ccording to Jill Kates, he had a vision when he took reins of the
company and then used all the resources available to make that vision a
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reality. In the personal computer workplace, many operating conditions call for
urgent action, making this style of leadership effective.
*2

?hile Kates does not e0hibit this
style consistently, his success can be
!udged by his decision making process
and the growth of the computer industry in
the world.
**
'll autocratic leaders share similar
-ualities. They are often dictators, who rule
with an iron fist and allow no(one to oppose
them. ?hen Marcos was alive, he was
known for repressing dissent (( those he
believed were his political enemies were
imprisoned or even killed. e did not allow
freedom of the press, and he curtailed civil
liberties.
*,
AS APP)IED IN INTERNATIONA) SHIP MANAGEMENT
'utocratic management used very effectively in the military, e0actly the
type of environment where once person has to take the lead role and guide
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http+CCwiki.answers.comCLC?hatHmakesH"erdinandHMarcosHasHaHautocraticHleader
1*
the rest. Muring situations of high pressure where everyone is either folding or
losing their heads, an autocratic leader is needed to steer a sinking ship and
co(ordinate the masses, an e0ample of this would be during a natural disaster
where -uick, decisive decisions can be critical.
The autocratic leadership style is best used in situations where control
is necessary, often where there is little margin for error.
*.
?hen conditions are dangerous, rigid rules can keep people out of
harm7s way. Many times, the subordinate staff is ine0perienced or unfamiliar
with the type of work and heavy oversight is necessary.
*/
Therefore, 'utocratic Management Style is not applicable to
International Ship Management.
AS APP)IED IN DOMESTIC SHIP MANAGEMENT
Management in the 2hilippines is very personal. 2eople take
everything personally.
Bou have to be careful of what you say and how you say it, especially
criticism.
Therefore, 'utocratic Management Style is not applicable either to
Momestic Ship Management.
1+. PERMISSI,E MANAGEMENT STY)E
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2er(mis(sive $ad!ective%+ giving people a lot of freedom or too much freedom
to do what they want to do.
*1
The 2ermissive Management Style allows employees to take part in
business decisions. ' rather considerable degree of autonomy on the
part of employees is encouraged in this management style.
*4
The manager provides full autonomy to the subordinates to e0ecute
their responsibility in the most efficient way, without either monitoring it
or supervising it. This style is best suited for motivated and skilled
workers, but may fail with less skilled ones
*5
This type of employee also facilitates delegating responsibilities
downward because they are willing and able to complete their !ob
tasks.
,6
T/$ 0"1e2 $3 Per4i22i5e #e!der2*
PERMISSI,E DEMOCRAT+ takes decisions participatively, and also
gives autonomy to the subordinates in e0ecuting their work.
,1
PERMISSI,E A&TOCRAT+ takes decisions unilaterally, but gives
autonomy to the subordinates in e0ecuting their work.
,2
I66$5!0i$6
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http://www.merriam-webster.com/dictionar#/permissi,e
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http://www.webpronews.com/is-#our-management-st#'e-assisting-or-hurting-#our-business-2665-6%
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http://e$pertsco'umn.com/content/understanding-management-st#'es
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http://www.&arca.com/1n'ine-Sur,e#s-*roduct/1n'ine-Sur,e#s-So'utions/custom-business-
so'utions/management-st#'e.htm'
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The subordinates of a permissive leader are typically given free rein on
decision(making related to work responsibilities and pro!ects. This
allows motivated employees to tap into creativity and develop
innovative ideas and solutions for the company. This creative freedom
is most effective with a team of innovative employees who work well
together, despite the lack of leadership from the management team.
,*
Ne/ )e!der27i1
Jecause subordinates are responsible for making decisions, a
workplace led by a permissive leader may result in new leaders
emerging. This gives potential leaders a chance to step forward and
help guide decisions within the work teams. Self(directed, motivated
employees are able to hone their leadership skills since they aren>t
limited by a leader who takes full control of the workplace decisions.
,,
DISAD,ANTAGES*
If a business owner possesses an 'utocratic Management Style, and
the employees andCor type of business would benefit more from a
2ermissive Management Style, problems will arise.
,.
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The lack of decisions or guidelines from the manager can cause a
disorgani8ed, chaotic work environment.
,/
Dnable to maintain consistency in the decisions made. ?hen multiple
parties are involved in the decision(making, you often run into
disagreements on the proper way to proceed. This slows down the
decisions and may cause the company to miss out on opportunities.
,1
AS APP)IED IN INTERNATIONA) SHIPMANAGEMENT*
ITA)Y
Managers may take a somewhat paternalistic attitude to their employees.
They may demonstrate a concern for employees that goes beyond the
workplace and strictly profession. )mployees follow the procedures handed
down by their managers.
They believe that their supervisors have been chosen because they have
more e0perience and greater knowledge than those they manage, and it is,
therefore, unnecessary, and even inappropriate for them to consult with lower(
ranking individuals when decision(making.
&NITED 8INGDOM
)mployees e0pect to be consulted on decisions that affect them and the
greater good of the organi8ation.
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Managers strive for consensus and make a concerted attempt to get
everyone>s input before a decision is reached. The manager may still make
the ultimate decision, after consultation with the staff.
Jrits believe the best ideas and solutions often come from having many
stakeholders meet to discuss an issue. They also prefer for the highest(
ranking person to make the decision $and then perhaps clear it with someone
at a higher level%, so decision(making can be laborious.
NOR9AY
Managers generally act as coordinators or team leaders rather than autocratic
micro(managers. They are task(oriented and emphasi8e achieving a goal,
productivity and profits. They e0pect their employees to do their !ob in a
professional manner.
Managers make decisions after they have reached a consensus with their
work team or others who will be affected by the decision. Their egalitarian
$aiming for e-ual wealth, status etc., for all people% culture supports a
participative management style.
GERMANY
Managers are e0pected to give precise directions when assigning tasks so
that there is no -uestion what is e0pected.
,4
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Kermans like working in teams and collaborate -uite well across hierarchical
lines. The communication within a team is generally -uite collegial, albeit
somewhat direct and blunt. <ole allocation within the team is generally -uite
clearly defined and people will take greater responsibility for their specific task
than for the group as a whole.
,5
The leader will be deferred to as the final authority in any decisions that are
made, but they do not dominate the discussion or generation of ideas.
.6
SO&TH 8OREA
Managers may take a somewhat 1!0er6!#i20ic attitude to their employees.
.1
Since social class is important to the culture, it is nearly impossible for a lower
class person to supervise a person from a higher class. Intercultural sensitivity
is essential as it is considered a serious breach of eti-uette to put a young
person in charge of older workers. )mployees e0pect companies, and their
managers, to be 1!0er6!#i20ic+
5.
SINGAPORE
Managers may take a somewhat 1!0er6!#i20ic attitude to their employees.
.*
Singapore is a hierarchical culture, so the boss is considered to be superior to
their subordinates. Subordinates do not ask their boss -uestions, as it would
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indicate that the boss had not done a good !ob of e0plaining what was
necessary. Subordinates will canvass other workers and come to a group
consensus of what should be done and how it should be accomplished.
.,
The manager may function !:0$cr!0ic!##" and dictate to his subordinates. 't
the same time, managers will not compliment or chastise an employee
publicly. In fact, should they want to communicate bad news to their
employees, they might use an intermediary.
..
There may be informal networking between employees themselves or
supervisors and employees, although actual power is generally held in the
hands of a few key people at the top of the organi8ation.
./
&NITED STATES OF AMERICA
)mployees e0pect to be c$62:#0ed on decisions that affect them and the
greater good of the organi8ation.
.1
'merican managers are viewed as facilitators((people who help employees
do their best work((and not simply decision makers. They empower
employees and e0pect them to take responsibility.
.4
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)mployees freely cross management levels and speak directly to senior
managers. This freedom is particularly apparent at meetings, where everyone
in attendance is encouraged to participate openly.
.5
AS APP)IED IN DOMESTIC SHIPMANAGEMENT*
PHI)IPPINES
)ach person has a very distinct role within the organi8ation and management
would not be e0pected to consult with lower(ranking individuals when
decision(making.
/6
Managers may take a somewhat 1!0er6!#i20ic attitude to their employees.
/1
Mecisions are reached at the top of the company, although a great deal of
time is spent building consensus prior to reaching the decision. Managers are
e0pected to provide their subordinates with detailed instructions that cover
anyeventuality.
/2
Managers adopt a 1!0er6!#i20ic r$#e towards their subordinates and guide
them in both their business and personal lives.
/*
CONC)&SION*
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2ermissive style of management is not commonly applied both in
International and Momestic Ship Management, especially in big entities.
's we all knew, operations and transactions in the maritime industry
re-uires swift actions and decisions.
It will be too risky, time consuming and costly for the company.
1+' CONS&)TATI,E MANAGEMENT STY)E
;4
' consultative management style moves slightly further away from the
autocratic style that we looked at first. In this case the manager will actively
seek out the opinions of employees before a decision is made. ?hile both an
autocratic manager and a persuasive manager will place the needs of the
business before the employees, a consultative manager is far more likely to
recogni8e that employees are able to make a valuable contribution to the
running of the company.
There are many situations in which a consultative management style
might be appropriate. In fact, most large scale organi8ations will use
managers who adopt this style at some level in their business. #onsultative
managers consider the opinions of stakeholders, but decisions are still made
centrally. This means that there is an identifiable person who is responsible
for the decisions that are made, but that others are given an opportunity to
have some input into the decision making process.
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1. More input from employees means a larger pool of ideas. ' good idea
can be worth millions of dollars to a large scale organi8ation. The
consultative style helps to ensure that more ideas are generated, and
so the potential for uncovering a million dollar idea is increased.
2. <elated to the first point, the business will make better decisions. It is
one thing to generate ideas, and something else entirely to implement
the right one. The first step in making a good decision is to ensure that
several alternatives are considered. The consultative style makes this
possible.
*. =verall motivation will increase. ?hen employees feel that their input
is valued, they are likely to be motivated to make a contribution to the
successful running of the business.
Di2!d5!60!<e2

1. This approach to employee involvement can take much longer. ?hile
there is value in gaining input from a variety of different stakeholders,
there is no doubt that this will take much longer than an approach
where the decision is made by !ust one person.
2. #ertain information needs to be protected by large scale organi8ations.
'fter more than one hundred years the formula for #oca(#ola is still a
secret, as is the specific blend of herbs and spices used by N"#. 's
this information is :secret;, most stakeholders won7t be in a position to
provide a reasonable contribution to any decisions that must be made
about these issues.
2*
*. Kaining input from a variety of stakeholders doesn7t ensure that any
particular person7s ideas will be used. This can mean that some
people feel disappointed if their ideas are sought and then overlooked
on a regular basis.
The consultative style is used on a regular basis by many large scale
organi8ations. This is because it maintains some of the advantages of the
more dominant management styles $such as the autocratic style% without the
loss of direction that can accompany the laisse8 faire style. #onsultative
managers will often be seen asking various stakeholders what they would do
in certain situations, or how they would respond to events that have occurred.
?hile the final decision still rests with the manager, the action of seeking input
is part of the day(to(day reality of the business.
This style focuses on using the skills, e0periences, and ideas of
others. owever, the leader or manager using this style still retains the final
decision(making power. To his or her credit, they will not make ma!or
decisions without first getting the input from those that will be affected.
/.
The consultative leader traits are+ often involve others in problem
solving, team building, retains right for final decisions, focuses hisCher time on
more important activities, provides proper recognition, delegates but keeps
:veto power;, weighs all alternatives before final decision is made.
//
Fi#i1i6$ M!6!<e4e60 S0"#e
%5
http://weirdb'og.wordpress.com/2665/64/64/'eadership-st#'es-dictatoria'-authoritati,e-consu'tati,e-
participati,e/
%%
ibid
2,
Management style tends towards the paternalistic as is often found in
strongly hierarchical cultures. owever, managers need to be aware of certain
strong "ilipino characteristics, which underpin personal relationships within
the country.
/1
"irstly, people are e0tremely careful to ensure that others do not suffer
embarrassment or any sense of shame $hiya% as a result of their own actions
or their inability to meet the e0pectations of others. It is considered to be very
bad behavior to critici8e another in public, as this is the greatest insult that can
be given. To be openly critici8ed in public results in a loss of self(esteem and
personal dignity. 'ny attack on an individual>s self(esteem may have to be
revenged.
/4
Therefore, managers are keen to treat subordinates with respect whilst,
at the same time, maintaining the dignity of the position of boss. Instructions
will be given clearly and precisely and subordinates will be e0pected to follow
those instructions with little or no discussion.
/5
Secondly, relationship bonds run deep in "ilipino culture and the
manager e0pects loyalty. In return for this loyalty the boss will look after the
interests of those subordinates. It is very much a reciprocal arrangement.
16
%ei6< ! M!6!<er i6 07e P7i#i11i6e2
The business set up in the 2hilippines is hierarchical. Intercultural
management needs to take into account the need to maintain a formal
%5
http://www.wor'dbusinesscu'ture.com//i'ipino-+anagement-St#'e.htm'
%7
ibid
%4
ibid
56
Ibid
2.
manner and pay strict attention to titles, positions, and hierarchical
relationships. )0pect to find many gatekeepers whose !ob is to protect the
schedule of and limit access to the ultimate decision maker. In this
relationship(driven culture, you will find it easier to make the proper contacts if
a third party who already has a relationship with the decision maker makes
the introduction.
11
"ilipinos avoid behaviors that would make either party lose face. This
leads to an indirect communication style, so carefully watch facial e0pressions
and body language. This is a country where a smile may mean many different
things, not all of them positive.
12
R$#e $3 ! M!6!<er
#ross cultural management, when working in the 2hilippines, will be
more successful when bearing in mind that each person has a very distinct
role within the organi8ation and management would not be e0pected to
consult with lower(ranking individuals when decision(making.
1*
In the 2hilippines, as in other hierarchical societies, managers may
take a somewhat paternalistic attitude to their employees. They may
demonstrate a concern for employees that goes beyond the workplace and
strictly professional concerns.
1,
A11r$!c7 0$ C7!6<e
51
http://www..wintessentia'.co.u./intercu'tura'/management/phi'ippines.htm'
52
Ibid
53
Ibid
54
Ibid
2/
The 2hilippines7 intercultural adaptability and readiness for change is
apparent but because tradition is valued, change is not readily embraced
simply because it is new.
1.
A11r$!c7 0$ Ti4e !6d Pri$ri0ie2
Meadlines and timescales are fluid in the 2hilippines. 2atience will play
an essential part in successful cross cultural management.
?hile timescales and deadlines need to be set well in advance and
reiterated carefully, it should be understood that these will be viewed as
fle0ible. Successful cross cultural management may re-uire some degree of
patience.
1/
Klobal and intercultural e0pansion means that some managers may
have a greater appreciation of the need to enforce timescales and as such,
agreed deadlines are more likely to be met.
11
Deci2i$6 M!i6<
'lthough many businesses retain hierarchical structures, decisions are
often made after reaching a consensus of the stakeholders. "ew individuals
have full authority to make binding decisions concerning anything but
mundane matters.
14
55
Ibid
5%
Ibid
55
Ibid
57
Ibid
21
Teamwork is becoming increasingly important in most organi8ations.
The best ideas and solutions often come from having many people meet to
discuss an issue.
15
"ilipino managers will praise employees, although not generally in
public. Subordinates e0pect their efforts to be recogni8ed and rewarded. Most
"ilipinos are suspicious if praise is e0cessive or undeserved.
46
%$22 $r Te!4 P#!"er
This is a hierarchical culture where rank has its privileges. Mecisions
are reached at the top of the company, although a great deal of time is spent
building consensus prior to reaching the decision. Managers are e0pected to
provide their subordinates with detailed instructions that cover any eventuality.
Since they do not want to lose face $or have shame%, many "ilipinos are
hesitant to ask for clarification if they are uncertain about a task. Therefore, it
is a good idea to use written instructions to supplement verbal
communications whenever possible.
41
Managers adopt a paternalistic role towards their subordinates and
guide them in both their business and personal lives. Subordinates e0pect to
be praised for a !ob well done, and public praise is e0tremely important as it
heightens their self(respect. #riticism, however, must always be done in
private and must be handled diplomatically, being careful not to make the
subordinate lose face so some intercultural sensitivity will be necessary.
42
C$44:6ic!0i$6 !6d Ne<$0i!0i$6 S0"#e2
54
Ibid
76
Ibid
71
Ibid
72
Ibid
24
?ait to be told where to sit. This is a hierarchical culture and -uite
often seating conforms to the rank of the people involved. Bou may never
actually meet with the decision maker or it may take several visits to do so.
Mecisions are made at the top of the company. "ilipinos avoid confrontation if
at all possible. It is difficult for them to say @no@. Gikewise, their @yes@ may
merely mean @perhaps@. 't each stage of the negotiation, try to get
agreements in writing to avoid confusion or cross cultural misinterpretation.
Mecisions are often reached on the basis of feelings rather than facts, which is
why it is imperative to develop a broad network of personal relationships. Mo
not remove your suit !acket unless the most important "ilipino does.
4*
AS APP)IED IN INTERNATIONA) SHIPMANAGEMENT
'merican management seems to work best when the key needs are
speed, aggression, last(minute genius, and take(chance, inspiring leadership.
In boom times when it7s e0pand at all costsOpick the 'merican style. 't other
times the more deliberate, consultative )uropean approach is your ally.
Maybe this is why we are hearing more from the )uropeans these days.;
4,
' consultative management style can be viewed as a combination of
democratic and autocratic. The consultative manager will ask views and
opinions from their staff, allowing them to feel involved but will ultimately make
the final decision.
4.
AS APP)IED IN DOMESTIC SHIPMANAGEMENT
73
Ibid
74
http://bi&shi!ts-trends.com/2611/61/16/management-st#'es-u-s-europe-8apan-china-india-bra&i'-
russia/
75
http://www.'earnmanagement2.com/'eadership926st#'es.htm
25
In the 2hilippines,
Geading
4/
)mployee>s fear to e0press disagreement to their managers
In these cultures ine-ualities are e0pected and desired
Might makes right, skills(wealth(power(status go together
There is relatively strong congruence between how managers
behave and what workers e0pect from them.
"ilipinos believe that human interaction and contact form the
basis of a successful business relationship.
1+4 DEMOCRATIC STY)E OF MANAGEMENT
The term democratic $d mP krQt k% means of, characteri8ed by,
derived from, or relating to the principles of democracy9 upholding or favouring
democracy or the interests of the common people9 popular with or for the
benefit of all.
41
Memocracy is a form of government in which all eligible
citi8ens participate e-uallyReither directly or through elected representatives
Rin the proposal, development, and creation of laws. It encompasses social,
economic and cultural conditions that enable the free and e-ual practice of
political self(determination.
44
The term originates from the Kreek STUVWXYZ[Y
$d\mokrat]a% @rule of the people@, which was coined from S UV^ $d_mos%
@people@ and WX`ZV^ $kratos% @power@ or @rule@ in the .th century J#) to
7%
ttps://www.goog'e.com.ph/ur'(
75
0o''ins Eng'ish :ictionar# - 0omp'ete 2 ;nabridged 16th Edition 2664 < "i''iam 0o''ins Sons 2
0o. -td. 1454= 147% < >arper0o''ins *ub'ishers 1447= 2666= 2663= 2665= 266%= 2665= 2664.
77
"i.ipedia. ?etrie,ed 4/23/13
*6
denote the political systems then e0isting in Kreek city(states, notably 'thens9
the term is an antonym to XabZVWXYZ[Y $aristocratie% @rule of an elite@.
45
Ao
consensus e0ists on how to define democracy, but e-uality, freedom and rule
of law have been identified as important characteristics since ancient times.
56
The term @democracy@ first appeared in ancient Kreek political and
philosophical thought in the city(state of 'thens during classical anti-uity. Ged
by #leisthenes, 'thenians established what is generally held as the first
democracy in .64(.61 J#). #leisthenes is referred to as @the father of
'thenian democracy.;
51
In the democratic style of management, the
manager allows the employees to take part in decision(making+ therefore
everything is agreed upon by the ma!ority.
52
The communication is e0tensive
in both directions $from employees to leaders and vice(versa%.
5*
This style can
be particularly useful when comple0 decisions need to be made that re-uire a
range of specialist skills+ for e0ample, when a new I#T system needs to be
put in place, and the upper management of the business is computer(
illiterate.
5,
"rom the overall business>s point of view, !ob satisfaction and
-uality of work will improve, and participatory contributions from subordinates
will be much higher.
5.
owever, the decision(making process could be
severely slowed down unless decision processes are streamlined.
5/
The need
for consensus may avoid taking the >best> decision for the business unless it is
74
Ibid
46
Ibid
41
Ibid
42
Ibid
43
Ibid.
44
Ibid.
45
Ibid.
4%
Ibid.
*1
managed or limited.
51
's with the autocratic leaders, democratic leaders are
also two types i.e. permissive and directive.
54

Ad5!60!<e2 $3 De4$cr!0ic M!6!<e4e60
)ncourages group discussion, which can lead to greater
communication throughout the business, whether it7s between
employees or between employees and management.
55
)mployees are encouraged to convey their opinions to the
management staff regarding important issues9 this makes the
employee feel significant to the company.
166
Making the staff feel
valued can increasing morale and productivity.
161
Management can harness the ideas from front line staff who are
involved in the day to day inner(workings of the business, allowing the
management to take action on issues the staff feel are holding the
company back.
162
Jecause decisions are usually decided by the ma!ority, it reduces the
chance of conflict, either between employees or between employees
and management.
16*
45
Ibid.
47
Ibid.
44
http://www.t#peso!management.net/democratic-management/. ?etrie,ed 4/23/13
166
Ibid.
161
Ibid.
162
Ibid.
163
Ibid.
*2
Di2!d5!60!<e2 $3 De4$cr!0ic M!6!<e4e60
If a vote or meeting takes place when every ma!or decision has to be
made, the whole process can take a long time. Management may
struggle if asked to take -uick and decisive action, something an
autocratic manager would strive under.
16,
The decisions may not be in the company7s best interest, because
they are decided upon by the ma!ority, with the ma!ority being the
workers, decisions could lean towards their best interests and not the
company7s.
16.
'nother disadvantage of democratic management is when the staff is
not knowledgeable about the discussion, this can lead them to make
an incorrect vote or portray a mistaken vision for the business.
16/
?e have talked about the advantage of reduced conflict as a result of
democratic management, but it can also increase conflict in certain
situations, if one group are opposed to a decision, it can create friction
between the people who are for implementing the new ideas.
161
C$6c#:2i$6
164
Ibid.
165
Ibid.
16%
Ibid.
165
Ibid.
**
' democratic style of management will put trust in employees and
encourage them to make decisions.
164
They will delegate to them the authority
to do this $empowerment% and listen to their advice.
165
This re-uires good two(
way communication and often involves democratic discussion groups, which
can offer useful suggestions and ideas.
116
Managers must be willing to
encourage leadership skills in subordinates.
111

The ultimate democratic system occurs when decisions are made based
on the ma!ority view of all workers.
112
owever, this is not feasible for the
ma!ority of decisions taken by a business( indeed one of the criticisms of this
style is that it can take longer to reach a decision.
11*
This style has close links
with er8berg7s motivators and Maslow7s higher order skills and also applies
to McKregor7s theory B view of workers.
11,
I##:20r!0i$6
The following scenario is an e0ample of the democratic style of
management in action+
:Steve manages a small sports centre. e has a team of
only ten staff, including an all(round sports instructor. This
167
http://tutor2u.net/business/gcse/peop'emanagementst#'es.htm . ?etrie,ed 4/23/13
164
Ibid.
116
Ibid.
111
Ibid.
112
Ibid.
113
Ibid.
114
Ibid.
*,
means that he can run his team in the manner he likes
best+ as a democracy.
?hen an area ad!acent to Steve7s sports centre becomes
available, Steve draws up a Jusiness #ase for ac-uiring
it and developing it into a ice(skating rink. e presents
this plan to his staff and gives them a week to do their
own research before holding a company meeting to
decide whether Steve should go ahead with his plan.
The team are divided between those who want to
e0pand, those who would rather have something -uieter,
like a cra8y golf course or a picnic area, and those who
are worried that the pro!ect will fail, !eopardising their own
salaries.
Steve compromises+ he will ac-uire the area, but he will
build a rink for roller(blading rather than ice(skating. '
roller(blading rink will take far less time and cost, and can
easily be converted into something else O like a cra8y golf
course O if it goes wrong.
'lmost every member of staff approves of the new plan.
Steve7s receptionist privately think that he is an idiot for
not making his own decisions, but she doesn7t particularly
care whether they build an ice(skating or a roller(blading
rink. The caretaker announces that he will be happy so
*.
long as he gets the assistant that has been promised to
him.
=nly the sports instructor is unhappy. e has never tried
roller(blading or ice(skating, and he does not want Steve
to employ another instructor, because this might reduce
the demand for his swimming lesson and tennis
coaching.
Steve spends the whole morning bargaining with and
trying to persuade the sports instructor, but to no avail.
e tells his team that they can have another week to
think about the pro!ect, while he does some more
research into the figures and marketing.
Jefore the week is up, a rival company buys the vacant
site. Steve has to conceal his frustration as he watches
the construction process. The following year, when the
sports instructor has left to !oin his son7s newly(opened
gym in ?ales, Steve sees the first adverts appear for an
ice(skating rink, smack ne0t to his own small sports
centre.
Steve7s democratic style served him up to a point in
creating a cohesive and supportive team with personal
investment in his pro!ect. Jut Steve7s refusal to make a
decision without the full consent of his team left his staff
without direction.
*/
Temporary adoption of the authoritative mantle would
have enabled Steve to acknowledge the views of his
sports instructor, to weigh them against the benefits to his
business, and to inform the team of his decision, rather
than waiting for theirs.;
11.
Fi#i1i6$ S0"#e
It is said that the "ilipino style of management in almost any
kind of business is characteri8ed by strong personal relationships.
This has something to do with the concept of :damdamin; which is
more profound than its )nglish translation $feelings%.
In relation thereto, another "ilipino cultural concept which
must be dealt with is :hiya; $shame%. The manager should be very
careful so as not to embarrass or critici8e any employee in public
since it may be considered as a grave insult, hence, an affront to
personal dignity which may e0act revenge.
Managers should treat subordinates with respect who, in
turn, are e0pected to follow the boss7 instructions to the letter. The
"ilipino manager e0pects loyalty from his subordinates while the
latter e0pects the former to look after them.

1+5 CHAOTIC STY)E OF MANAGEMENT
115
http://training-course.org/management-st#'e-democratic-manager.php@ . ?etrie,ed 4/23/13
*1
' very modern style of management, chaotic management gives the
employees total control over the decision making process. Some modern
companies have adopted this style of management and in return have
become some of the most influential and innovative companies.
11/

#haos Theory regards organi8ationsCbusinesses as comple0, dynamic,
non(linear, co(creative and far(from(e-uilibrium systems. Their future
performance cannot be predicted by past and present events and actions. In a
state of chaos, organi8ations behave in ways which are simultaneously both
unpredictable $chaotic% and patterned $orderly%.
111
#hange is constant. 'lthough certain events and circumstances in an
organi8ation can be controlled, others can>t. #haos theory recogni8es that
change is inevitable and is rarely controlled. ?hile organi8ations grow,
comple0ity and the possibility for susceptible events increase. =rgani8ations
increase energy to maintain the new level of comple0ity, and as organi8ations
spend more energy, more structure is needed for stability. The system
continues to evolve and change
114
.
The notion of chaos denotes crisis and disorder, a state of non(
e-uilibrium, instability, turbulence, rapid or rupturing changes that scramble
plans and cause unpredictability, with conse-uences of an0iety, fear of
unknown, and triggering and tripling effects of destruction and systems
11%
: http://en.wi.ipedia.org/wi.i/+anagementst#'es
115
http://rudo'!t8andra.com/chaos-theor#-o!-management/
117
http://sma''business.chron.com/management-theories-concepts-wor.p'ace-15%43.htm'
*4
breakdown. There is no single definition of chaos theory. The notion has been
used interchangeably with such concepts as non(linear systems models,
disorder theory, and dynamical comple0 theory. The notion has also appeared
in association with IIcatastrophe77 theory $Thom, 15129 Feeman, 1511%
developed out of 2oincare7s $1446O56% IIbifurcation77
theory and IIdiscontinuity77 theory $<oss, 26669 "ollmer, 151,9 Jrook,
155*9Jrock and Murlauf, 155.%, IInone-uilbrium77 dynamical theory,
IIdialecticaldynamic77 theory $Ilyenkov, 15119 "ara8mand, 2662b%, IIcomple0ity77
theory of the Jrussels School $Aicolis and 2rigogine, 1511%, and IIsynergetics77
theory developed by aken $154*% of the Stuttgart School.
115
#haos theory is a scientific principle describing the unpredictability of
systems. Most fully e0plored and recogni8ed during the mid(to(late 1546s, its
premise is that systems sometimes reside in chaos, generating energy but
without any predictability or direction. These comple0 systems may be
weather patterns, ecosystems, water flows, anatomical functions, or
organi8ations. ?hile these systems>s chaotic behavior may appear random at
first, chaotic systems can be defined by a mathematical formula, and they are
not without order or finite boundaries.
126

ORIGIN OF CHAOS THEORY
114
/A?AB+AC:=A-I= *ub'ic 1rgani&ation ?e,iew: A D'oba' Eourna' 3: 334F352 G2663H. Chaos and
Transformation Theories:A Theoretical Analysis with Implications for Organization Theory and Public
Management.
;p'oaded !rom http://54.%5.51.235:7676/gg/wen$ian/en/6%.pd!
126
http://www.re!erence!orbusiness.com/management/Iun-0omp/0haos-)heor#.htm
*5
=ne of the first scientists to comment on chaos was enri
2oincarc$14.,O1512%, a late(nineteenth century "rench mathematician who
e0tensively studied topology and dynamic systems. e left writings hinting at
the same unpredictability in systems that )dward Goren8 $b. 1511% would
study more than half a century later. 2oincarc e0plained, @It may happen that
small differences in the initial conditions produce very great ones in the final
phenomena. ' small error in the former will produce an enormous error in the
latter. 2rediction becomes impossible.@ Dnfortunately, the study of dynamic
systems was largely ignored long after 2oincarc>s death.
121

Ilya Pri<$<i6e, Aobel laureate, showed that comple0 structures
could result from simpler ones. This is like order coming from chaos. enry
'dams previously described this with his -uote :#haos often breeds life,
when order breeds habit;. He6ri P$i6c!r= was really the :"ather of #haos
dTheorye,; however. The planet Aeptune was discovered in 14,/ and had
been predicted from the observation of deviations in Dranus7 orbit. Ning
=scar II of Aorway was willing to give a pri8e to anyone who could prove or
disprove that the solar system was stable. 2oincarc offered his solution, but
when a friend found an error in his calculations, the pri8e was taken away
until he could come up with a new solution that worked. e found that there
was no solution. Aot even the laws of Sir Isaac Aewton provided a solution
to this huge problem. 2oincarc had been trying to find order in a system
where there was none to be found. #haos theory was formulated during the
15/6s. Significant and more practical work was done by Ed/!rd )$re6> in
121
http://www.re!erence!orbusiness.com/management/Iun-0omp/0haos-)heor#.htm'
,6
the 15/6s. The name chaos was coined by ?i4 Y$re, an applied
mathematician at the Dniversity of Maryland $<uelle, 1551%.
122
?hen #haos Theory was first e0plored as an e0planatory theory for
management practice, Man Kriffiths, 'nn art and Jillie Jlair wrote+ :' great
many facets of administrative work cannot be described, e0plained, or
predicted by current dmanagemente theoriesfdmanagerse are chagrined when
seemingly minor and innocuous events that are -uickly forgotten surface later
as ma!or lawsuits, noisy demonstrations, acrimonious confrontations, or
strikes. These events do not seem to be related to the dmanager7se
competence, foresight, intelligence, knowledge, or sensitivity. Jecause these
events are unrelated to the customary relationships that characteri8e a
leader7s work, they represent a form of disorder that reappears with seeming
regularity.;
12*

&2!<e $3 C7!$2 T7e$r"+ A11#ic!0i$62
The principles of #haos Theory have been successfully used to describe
and e0plain diverse natural and artificial phenomena. Such as+
2redicting epileptic sei8ures.
2redicting financial markets.
Modelling of manufacturing systems.
122
http://rudo'!t8andra.com/chaos-theor#-o!-management
123
I'air=Ii''ie D. ;p'oaded !rom www.marinemoneyoffshore.comCnodeC/1.4
,1
Making weather forecasts.
#reating "ractals. #omputer(generated images applying #haos
Theory principles.
In a scenario where @:2i6e22e2 operate in a turbulent, comple0 and
unpredictable environment, the tenets of #haos Theory can be e0tremely
valuable. 'pplication areas can include+
Jusiness Strategy C #orporate Strategy.
#omple0 decision(making.
Social sciences.
=rgani8ational behaviour and organi8ational change.
Stock market behaviour, investing.
12,
S0e12 i6 C7!$2 T7e$r" Pr$ce22
To control chaos, the system or process of chaos has to be controlled. To
control a system, what is needed is+
1. ' target, ob!ective or goal which the system should reach. "or a
system with predictable behaviour $deterministic% this may be a
particular state of the system.
2. ' system capable of reaching the target or goal.
124
http://rudo'!t8andra.com/chaos-theor#-o!-management/
,2
*. Some means of influencing the system behaviour. These are the
c$60r$# i61:02 $decisions, decision rules, or initial states%.
12.
AD,ANTAGES OF CHAOTIC MANAGEMENT STY)E
1. 2opulari8ed around the world by multinational company Koogle, this
management style believes that employees perform to their full
potential when they are given a free hand. Many modern thinkers
believe that chaotic management style allows an employee to work on
his idea, without the interference of the management, and this helps in
creating new innovations. They are also of the opinion that the chaotic
management style will be adopted by a lot of companies in the future
as the management will need to be in sync with the fast(paced lifestyle
of the employees.
12/
2. Some managers prefer a chaotic management style. ?ith the rise in
technology and persons becoming more and more creative, this style
of management may be the wave of the future. Aot everyone is
technologically savvy or innovative, so this style would not work for all
industries. Dsually, employees who are technologically savvy tend to
like this approach to management, as they seem best able to attain
their creative potential without constant meddling from managers.
121
125
http://rudo'!t8andra.com/chaos-theor#-o!-management/
12%
Jhi'awa'a= ?ashida G2613H. ;p'oaded !rom http://www.buzzle.com/articles/management-styles-
list-of-different-types-of-anagement-styles.html#P
125
http://www.assertsuccess.com/management-st#'e/
,*
*. #haotic management deploys minimum physical supervision of
employees and e0pects that in return to the acres of room they get to
e0ecute their !obs, the employees will take responsibility for their
decisions and actions.
124
,. =rgani8ational e0pectations for acceptable behavior, and the degree of
freedom with which individuals are allowed to work, shape the way a
company>s problems and challenges are handled by its members. Jy
allowing people and groups within an organi8ation some autonomy,
businesses encourage the organi8ation to organi8e itself, enacting
multiple iterations of its own functioning until the various pieces of the
organi8ation can work together most effectively.
125

.. 2eriods of chaos can dramatically increase progress by breaking down
old barriers. ?hile chaos introduces new risks, it also introduces new
opportunities. 2eople, pro!ect managers in particular, are drawn to
create order and structure. That order helps us work together
peacefully, like traffic signals at a busy intersection. owever, when
the outside world changes, the order can trap us in stagnant eddies or
ineffective organi8ations.
1*6

127
http://www.nation.co.ke/Features/DN/!haotic-management-proposed-for-"en-
#s-/-/$%&'()/*'()+,)/-/sgm)pnz/-/inde-.html
124
0haos )heor#K Enc#c'opedia o! +anagement Ed. +ari'#n +. >e'ms. Lo'. 1. Da'e 0engage 266%
eCotes.com 22 Sep= 2613.;p'oaded !rom http://www.enotes.com/topics/chaos-
theor#/re!erenceMre!erence-chaos-theor#-15%%%4
136
www.happ#-pro8ect-management.com/0haos-)heor#.htm'
,,
/. ' little unstructured time opens up our creativity and helps us see the
world differently. ' chance encounter with a new person, or a new
idea could alter our path !ust a little and make a huge difference in how
we do. Gikewise, as leaders, we can help guide our teams to make the
small changes that help them succeed. 'll it takes is a little knowledge
of chaos theory.
1*1
DISAD,ANTAGES OF CHAOTIC MANAGEMENT STY)E
1. 'pplying chaos theory to organi8ational practice tends to go against
the grain of most formal management patterns. =rder can be confused
with the more popular notion of control. Mefined by organi8ation charts
and !ob descriptions, traditional management does not generally seek
to add disorder to its strategic plan. 's ?heatley states, @It is hard to
open ourselves up to a world of inherent orderliness.@ =rgani8ations
are focused on structure and design. #harts are drawn to illustrate who
is accountable to whom or who plays what role and when. Jusiness
e0perts break down organi8ations into the smallest of parts. They build
models of organi8ational practice and policy with hope that this
atomi8ing yields better information on how to improve the
organi8ation>s functioning. owever, chaos theory implies that this is
unnecessary, even harmful.
1*2
131
Ibid.
132
K0haos )heor#K Enc#c'opedia o! +anagement Ed. +ari'#n +. >e'ms. Lo'. 1. Da'e 0engage 266%
eCotes.com 22 Sep= 2613.;p'oaded http://www.enotes.com/topics/chaos-theor#/re!erenceMre!erence-
chaos-theor#-15%%%4.
,.
2. The limitations of applying #haos Theory are in due mostly from
choosing the input parameters. The methods chosen to compute
these parameters depend on the dynamics underlying the data and
on the kind of analysis intended, which is in most cases highly
comple0 and not always accurate
1**
*. #haos theory is not as simplistic to find an immediate and direct
application in the business environment, but mapping of the business
environment using the knowledge of chaos definitely is worthwhile
studying.
1*,
CHAOTIC MANAGEMENT STY)E AS APP)IED TO PHI)IPPINE
DOMESTIC SHIPPING*
Kiven the 2hilippines> 'merican and Spanish heritage, it>s easy to fall
into the trap of assuming that you can do business here in standard ?estern
mode. Manuel Lue8on, the first 2resident of the 2hilippine #ommonwealth
during the years before ?orld ?ar II, once said+ @The "ilipinos are the most
occidental people of the =rient.@
1*.
The 2hilippine Jusiness as "amily. The family is always of vital
importance in the 2hilippines9 not surprisingly, most business organi8ations
are modeled on the "ilipino family. The boss and subordinate often e0ist in a
133
http://rudo'!t8andra.com/chaos-theor#-o!-management
134
http://rudo'!t8andra.com/chaos-theor#-o!-management
135
>enderson=0'arence.G1444H. Pearl of the Orient ea.;p'oad !rom
http://www.apm!orum.com/co'umns/orientseas%.htm.
,/
bata relationship, basically like that between parent and child $bata literally
meaning @child@%. 's a conse-uence, paternalistic management styles are the
norm.
's you might e0pect, such a paternalistic and hierarchical
management structure implies that decision making in most organi8ations is
done at the top. 'nd unless you have some e0cellent inside connections or
referrals, your initial contacts are not likely to be with the decision(maker.
Ketting to someone who can and will act on a proposal $i.e., sign a contract,
write a check% often has be done through one or more gatekeepers, a process
that can take a seeming eternity. owever, once you finally push your way
through to the top, the gears can shift -uickly and deals completed at warp
speed.
1*/
enderson $1555% stressed in his article, 2earl of the =rient Seas, that
the communications and management styles described are not dishonest or
intended to cheat the reader. They simply reflect the "ilipino culture and long(
established way of doing things. The models and ideal types taught in
?estern(oriented MJ' programs are based on certain assumptions, many of
which are i65!#id in the 2hilippines. 'lthough organi8ations here have most of
the structures and formal procedures of ?estern business, actual day(to(day
business processes and interactions necessarily proceed within the matri0 of
"ilipino culture and values. Thus, the needs for the ?esterner to go :the e0tra
13%
Ibid
,1
mile; to understand what7s really going on and adapt a culturally sensitive
style of doing business.
1*1
Mifferences in cultural backgrounds of managers and employees are
fre-uently a source of misunderstanding. #orporate management in the
2hilippines is a relatively new phenomenon introduced by the 'mericans.
Traditionally the only organi8ation was the family, for even the barangay
$village% was loosely organi8ed. )ven today some big corporations in the
2hilippines still operate on familial lines, with modifications to suit the
contemporary re-uirements of corporate management.
1*4
"ilipino management often uses the compadre and e0tended family
systems which are strongly related to the concepts of losing face, ambiguity,
and utang na loob $debt of gratitude%. Bet "ilipino organi8ations also use the
automatic, bureaucratic, consensual, and participative styles associated with
western cultures.
1*5
The paternalistic "ilipino manager is compensating for what society
does not provide ade-uately. e is a surrogate pater familae and by satisfying
this e0pectation becomes a more effective manager.
1,6
'lthough the 2hilippines uses some western concepts in managing
business like the domestic shipping industry, still, the domestic shipping
industry has not been using the chaotic management style .<esearch and
135
>enderson=0'arence.G1444H. Pearl of the Orient ea. ;p'oad !rom
http://www.apm!orum.com/co'umns/orientseas%.htm.
137
http://www.pabc.org.ph/main/e,ents.php(id31%
134
http://www.pabc.org.ph/main/e,ents.php(id31%
146
Ibid
,4
publications made by authorities in 2hilippine business management shows
that paternalistic and hierarchical management are widely use.
CHAOTIC MANAGEMENT STY)E AS APP)IED IN INTERNATIONA)
SHIPPING
The chaotic management style is relatively new O employees are given
control over the decision(making process, producing an organisation that is
very flat with authority often based around departments or divisions.
1,1
's chaotic and random as world events seem today, they seem as
chaotic in organi8ations, too. Bet for decades, managers have acted on the
basis that organi8ational events can always be controlled. ' new theory $or
some say :science;%, chaos theory, recogni8es that events indeed are rarely
controlled. Many chaos theorists $as do systems theorists% refer to biological
systems when e0plaining their theory. They suggest that systems naturally go
to more comple0ity, and as they do so, these systems become more volatile
$or susceptible to cataclysmic events% and must e0pend more energy to
maintain that comple0ity. 's they e0pend more energy, they seek more
structure to maintain stability. This trend continues until the system splits,
combines with another comple0 system or falls apart entirely. Sound familiarg
This trend is what many see as the trend in life, in organi8ations and the world
in general.
1,2
141
http://www.hr&one.com/hr-g'ossar#/management-st#'es-de!inition
142
http://managementhe'p.org/management/theories.htm
,5
Jasic concept of the ship management is very similar for most ship
types. Ships, however, operate under wide range of conditions. The cargo
carried, the trade in which the ship is engaged and the background of the
crew all have effect on ship management and conse-uently, management
styles vary with the #ompany.
1,*
Koulielmos $2616% describes life better than hither(to available
theories, as it deals more effectively with dynamic, non(linear and cyclical
phenomena.
1,,
If however, a company is seen as self organi8ed emerging ordered
,then a new approach must be adopted ,i.e. that of comple0ity theory.The
choice of the above competition is because shipping environment is indeed
unpredictable, volatile, cyclical and international as well as comple0.It is
believed that this theory can yield a new, more pragmatic ,insight into the way
shipping companies and ships should be managed. In addition, no previous
attempts have been made to apply this theory to management of shipping
companies.
1,.
"arasmand $ 266*% noted that #haos Theory is used in association
with IIcomple0ity77 theory of the Jrussels School $Aicolis and 2rigogine,
1511%.
1,/
143
-win=Soe 0apt. ;p'oaded !rom http+CCwww.wmu.sof.or.!pCfwHlwinH61.pdf
144
Dou'ie'mos=A'e$ander +. G2616H. ;p'oaded !rom
http://www.tand!on'ine.com/doi/abs/16.1676/63677736216144365Mpre,iew
145
Ibid
14%
/ara&mand=A'i. *ub'ic 1rgani&ation ?e,iew: A D'oba' Eourna' 3: 334F352 G2663H. Chaos and
Transformation Theories:A Theoretical Analysis with Implications for Organization Theory and Public
Management.
;p'oaded !rom http://54.%5.51.235:7676/gg/wen$ian/en/6%.pd!
.6
International shipping companies uses different style of management
to suit their organi8ation need. #haotic management style in shipping industry
is relative new concept and in these style of management, it give its
employees total control in decision making which is not yet adopted by
shipping companies.
1+5)AISSEA(FAIR MANAGEMENT STY)E
Laissez-faire $or sometimes laisser(faire% is an economic environment
in which transactions between private parties are free from government
restrictions, tariffs, and subsidies, with only enough regulations to protect
property rights.
d1e
The phrase laissez-faire is "rench and literally means @let
dtheme do@, but it broadly implies @let it be,@ @let them do as they will,@ or @leave
it alone@. Scholars generally believe a laissez-faire state or a completely free
market has never e0isted.
1,1
E0"4$#$<"
'ccording to historical legend, the phrase stems from a meeting in
about 1/46 between the powerful "rench finance minister hean(Japtiste
#olbert and a group of "rench businessmen led by a certain M. Ge Kendre.
145
Eump up N Iuder= Stan'e#. 2664. 0apita'i&ing on 0hange: A Socia' >istor# o! American Iusiness
*g. 13. ISIC 457-6-7657-3231-7.
Eump up N >essen= ?obert. KKA !u''# !ree econom#= true 'aisse&-!aire= ne,er has e$isted...K= ?obert
>essen= senior research !e''ow at Stan!ord ;ni,ersit#Os >oo,er InstitutionK. Econ'ib.org. ?etrie,ed
2613-65-36.
.1
?hen the eager mercantilist minister asked how the "rench state could be of
service to the merchants and help promote their commerce, Ge Kendre
replied simply @Laissez-nous faire@ $@Get us be@, lit. @Get us do7%.
1,4
The anecdote on the #olbert(Ge Kendre meeting was related in a 11.1
article in the ournal !economi"ue by the "rench minister and champion of
free trade, <enc de &oyer, Mar-uis d>'rgensonRwhich happens to also be
the phrase>s first known appearance in print.
1,5
'rgenson himself had used
the phrase earlier $11*/% in his own diaries, in a famous outburst+
Gaisse8 faire, telle devrait _tre la devise de toute puissance publi-ue,
depuis -ue le monde est civilisc ... Mctestable principe -ue celui de ne vouloir
grandir -ue par l>abaissement de nos voisinsi Il n>y a -ue la mcchancetc et la
malignitc du coeur de satisfaites dans ce principe, et l7intcr_t y est opposc.
Gaisse8 faire, morbleui Gaisse8 fairei
1.6
$Trans+ @Get it be, that should be the
motto of all public powers, as the world is civili8ed ... That we cannot grow
e0cept by lowering our neighbors is a detestable notioni =nly malice and
malignity of heart is satisfied with such a principle and our $national% interest is
opposed to it. Get it be, for heaven>s sakei Get it bei%.
The laisse8 faire slogan was populari8ed by &incent de Kournay, a
"rench 2hysiocrat and intendant of commerce in the 11.6s, who is said to
147
Eump up N Eourna' 1economiPue 1551= Artic'e b# the /rench minister o! !inance.
144
Eump up N +. dOArgenson= K-ettre au su8et de 'a dissertation sur 'e commerce du marPuis de Ie''oniO=
A,ri' 1551= Eourna' 1economiPue p.111. See A. 1nc.en= :ie +a$ime -aisse& !aire et 'aisse& passer=
ihr ;rsprung= ihr "erden= 17%%
156
Eump up N as Puoted in E.+. Je#nes= 142%= K)he End o! -aisse& /aireK. ArgensonOs +Qmoirs were
pub'ished on'# in 1757= ed. Eannet= )ome L= p.3%2. See A. 1nc.en G:ie +a$ime -aisse& !aire et
'aisse& passer= ihr ;rsprung= ihr "erden= 17%%H
.2
have adopted the term from "rancois Luesnay>s writings on #hina.
1.1
It was
Luesnay who coined the term laisse8(faire, laisse8(passer
1.2
laisse8(faire
being a translation of the #hinese term wu wei
1.*
Kournay was an ardent
proponent of the removal of restrictions on trade and the deregulation of
industry in "rance. Kournay was delighted by the #olbert(GeKendre
anecdote,
1.,
and forged it into a larger ma0im all his own+ @Gaisse8 faire et
laisse8 passer@ $>Get do and let pass>%. is motto has also been identified as
the longer @Gaisse8 faire et laisse8 passer, le monde va de lui m_mei@ $@Get do
and let pass, the world goes on by itselfi@%. 'lthough Kournay left no written
tracts on his economic policy ideas, he had immense personal influence on
his contemporaries, notably his fellow 2hysiocrats, who credit both the
laisse8(faire slogan and the doctrine to Kournay.
1..
Jefore d>'rgenson or Kournay, 2.S. de Joisguilbert had enunciated
the phrase @on laisse faire la nature@ $>let nature run its course>%.
1./
celebrated
motto @2as trop gouverner@ $@Kovern not too much;%
1.1
Jut it was Kournay>s
151
Eump up N Iaghdiant& +c0abe= Ina G2667H. 1rienta'ism in Ear'# +odern /rance: Eurasian )rade
E$oticism and the Ancien ?egime. Ierg *ub'ishers. pp. 251F252. ISIC 457-1-74526-354-6.
152
Eump up N K-ibrar# o! Economics and -ibert#K. -ibert# /und= Inc. ?etrie,ed 22 September 2613.
Eump up N KEnc#c'opedia IritannicaK. Enc#c'opedia Iritannica= Inc.
153
Eump up N 0'ar.e= E.E. G1445H. 1rienta' En'ightenment: )he Encounter Ietween Asian and "estern
)hought. ?out'edge. p. 56. ISIC 457-64151335%6.
154
Eump up N According to E. )urgotOs KE'oge de Lincent de Dourna#=K +ercure= August= 1554 Grepr. in
1eu,res o! )urgot= ,o'. 1 p.277.
155
Eump up N Dourna# was credited with the phrase b# EacPues )urgot GKE'oge a Dourna#K= +ercure
1554H= the +arPuis de +irabeau G*hi'osophie rura'e 15%3 and EphQmQrides du 0ito#en= 15%5.H= the
0omte dOA'bon G=KR'oge >istoriPue de +. Quesna#K= Cou,e''es EphQmQrides RconomiPues= +a#=
1555= p.13%-5. H and :u*ont de Cemours GIntroduction to 1ue,res de EacPues )urgot= 1767F11= Lo'. I=
p.255 and p.254 G:aire ed.HH among others
15%
Eump up N K)ant= encore une !ois= PuOon 'aisse !aire 'a nature= on ne doit rien craindre de parei'K= *.S.
de Ioisgui'bert= 1565= :issertation de 'a nature des richesses= de 'Oargent et des tributs.
155
Eump up N :u*ont de Cemours= op cit= p.257. 1nc.en Gop.citH and Je#nes Gop.cit.H a'so credit the
+arPuis dOArgenson with the phrase K*our gou,erner mieu$= i' !audrait gou,erner moinsK GK)o go,ern
best= one needs to go,ern 'essKH= possib'# the source o! the !amous K)hat go,ernment is best which
go,erns 'eastK motto popu'ar in American circ'es= attributed ,arious'# to )homas *aine= )homas
.*
use of the >laisse8(faire> phrase $as populari8ed by the 2hysiocrats% that gave
it its cachet.
Gaisse8 faire was proclaimed by the 2hysiocrats in the eighteenth
century "rance, thus being the very core of the economic principles, and was
more developed by famous economists, beginning with 'dam Smith.
1.4
It is
with the physiocrats and the classical political economy that the term @laisse8
faire@ is ordinarily associated.@d1/e The book Gaisse8 "aire and the Keneral(
?elfare State mentions that, @The physiocrats, reacting against the e0cessive
mercantilist regulations of the "rance of their day, e0pressed a belief in a
@natural order@ or liberty under which individuals in following their selfish
interests contributed to the general good. Since, in their view, this natural
order functioned successfully without the aid of government, they advised the
state to restrict itself to upholding the rights of private property and individual
liberty, to removing all artificial barriers to trade, and to abolishing all useless
laws.@
1.5
In )ngland, a number of @free trade@ and @non(interference@ slogans
had been coined already during the 11th century. Jut the "rench phrase
laisse8 faire gained currency in )nglish(speaking countries with the spread of
2hysiocratic literature in the late 14th century. The #olbert(GeKendre
anecdote was relayed in Keorge ?hatley>s 111, 2rinciples of Trade $co(
Ee!!erson and >enr# )horeau.
157
Eump up to: a b c d /ine= Sidne#. -aisse& /aire and the Denera'-"e'!are State. ;nited States: )he
;ni,ersit# o! +ichigan *ress= 14%4. *rint
154
Ibid
.,
authored with Jen!amin "ranklin% ( which may be the first appearance of the
phrase in an )nglish language publication.
1/6
Gaisse8(faire, a product of the )nlightenment, was @conceived as the
way to unleash human potential through the restoration of a natural system, a
system unhindered by the restrictions of government.@
1/1
In a similar vein,
'dam Smith viewed the economy as a natural system and the market as an
organic part of that system. Smith saw Gaisse8(faire as a moral program and
the market its instrument to ensure men the rights of natural law.
1/2
Jy
e0tension, free markets become a reflection of the natural system of liberty.
1/*
@"or Smith, laisse8(faire was a program for the abolition of laws constraining
the market, a program for the restoration of order and for the activation of
potential growth.@
1/,
owever, 'dam Smith,
1/.
and the notable classical economists, such
as Thomas Malthus, and Mavid <icardo, did not use the phrase. heremy
Jentham used the term, but it was probably hames Mill>s reference to the
@laissez-faire@ ma0im $together with @pas trop gou#erner@% in an 142, entry for
the $ncyclop%&ia 'ritannica that really brought the term into wider )nglish
1%6
Eump up N +acgregor= Economic )hought and *o'ic# G-ondon= 1444H= pp. 54-%5
1%1
N Eump up to: a b c d e ! g Daspard= )ou!ic.. A *o'itica' Econom# o! -ebanon 1447-2662: )he
-imits o! -aisse&-!aire. Ioston: Iri''= 2664. *rint
1%2
Ibid
1%3
Ibid
1%4
Ibid
1%5
N Eump up to: a b ?o# 0. Smith= Adam Smith and the 1rigins o! American Enterprise: >ow the
/ounding /athers )urned to a Dreat EconomistOs "ritings and 0reated the American Econom#=
+acmi''an= 2664= ISIC 6-312-3255%-2= pp. 13F14.
..
usage. ?ith the advent of the 'nti(#orn Gaw Geague, the term received much
of its $)nglish% meaning.
1//

'dam Smith first used the metaphor of an @invisible hand@ in his book
The Theory of Moral Sentiments to describe the unintentional effects of
economic self(organi8ation from economic self(interest.
1/1
The idea lying
behind the @invisible hand@, though not the metaphor itself, belongs to Jernard
de Mandeville and his "able of the Jees. In political economy that idea and
the doctrine of laisse8 faire have always been closely related.
1/4
True, Smith
was familiar with the term, but he chose not to use them in his political
economy and moral philosophy because they did not benefit the consumers
who, as a result of them, paid higher prices and because they restricted
competition, and people risked serious in!uries.
1/5
Some have characteri8ed
this metaphor as one for laisse8(faire,
116
but Smith never actually used the
term himself.
111
F:6d!4e60!#2 $3 )!i22e> F!ire
's a system of thought, laisse8 faire rests on the following a0ioms+
112

1%%
Eump up N Abbott *. ;sher et a'. G1431H. KEconomic >istor#S)he :ec'ine o! -aisse& /aireK.
American Economic ?e,iew 22 G1= Supp'ementH: 3F16.
1%5
Eump up N Andres +arroPuin= In,isib'e >and: )he "ea'th o! Adam Smith= )he +iner,a Droup=
Inc.= 2662= ISIC 1-4162-6277-5= page 123.
1%7
Eump up N Eohn Eatwe''= )he In,isib'e >and= ".". Corton20ompan#= 1474= pp. *re!ace $1.
1%4
Eump up N Jenned#= Da,in GSeptember 21= 2612H. KAdam SmithTs -ost -egac#K. ?etrie,ed Apri' %=
2613.
156
Eump up N K)he mathematica' centur#: the 36 greatest prob'ems o! the 'ast 166 #ears G266%H
*iergiorgio 1di!reddi= Arturo Sanga''i= /reeman E :#son= p. 122K. Doog'e.com. ?etrie,ed 2613-65-36.
151
N Eump up to: a b ?o# 0. Smith= Adam Smith and the 1rigins o! American Enterprise: >ow the
/ounding /athers )urned to a Dreat EconomistOs "ritings and 0reated the American Econom#=
+acmi''an= 2664= ISIC 6-312-3255%-2= pp. 13F14.
152
N Eump up to: a b c d e ! g Daspard= )ou!ic.. A *o'itica' Econom# o! -ebanon 1447-2662: )he
-imits o! -aisse&-!aire. Ioston: Iri''= 2664. *rint
./
1. The individual is the basic unit in society. 2. The individual has a natural
right to freedom. *. The physical order of nature is a harmonious and self(
regulating system. ,. #orporations are creatures of the State and therefore
must be watched closely by the citi8enry due to their propensity to disrupt the
Smithian spontaneous order. These a0ioms constitute the basic elements of
laisse8(faire thought, although another basic and often(disregarded element is
that markets should be competitive, a rule that the early advocates of laisse8(
faire have always emphasi8ed.
11*
Hi20$r" $3 #!i22e>(3!ire de@!0e
#hinadMuring the an, Tang, Song, and Ming dynasties, #hinese
scholar(officials would often debate about the interference the government
should have in the economy, such as setting monopolies in lucrative
industries and instating price controls. Such debates were often heated with
#onfucian factions tending to oppose e0tensive government controls and
@<eform@ factions favoring such moves. Muring the an and Tang, emperors
sometimes instated government monopolies in times of war, and abolished
them later when the fiscal crisis had passed. )ventually, in the later Song and
Ming dynasties, state monopolies were abolished in every industry and were
never reinstated during the length of that dynasty, with the government
following laisse8(faire policies. Muring the Manchu Ling Mynasty, state
monopolies were reinstated, and the government interfered heavily in the
153
Ibid
.1
economy9 many scholars believe this prevented #hina from developing
capitalism.
11,
E:r$1e
In )urope the laisse8 faire movement was first widely promoted by the
physiocrats, a movement that originated with &incent de Kournay, a
successful merchant. Kournay held that the government should allow the laws
of nature to govern economic activity, with the state only intervening to protect
life, liberty, and property. is ideas were taken up by "rancois Luesnay and
Turgot, Jaron de l>'ulne. Luesnay had the ear of the Ning of "rance, Gouis
E&, and in 11., persuaded him to give laisse8 faire a try. =n September 11,
the Ning abolished all tolls and restraints on the sale and transport of grain,
and for more than a decade the e0periment was a success. Jut then, in 11/4,
there was a poor harvest, and the cost of bread rose so high that there was
widespread starvation, while merchants e0ported grain in order to obtain the
best profit. In 1116, the edict allowing free trade was revoked.
11.
154
Eump up N -i Io and Bheng Uin= 5666 #ears o! 0hinese >istor#= Inner +ongo'ian *eop'eOs
pub'ishing corp = ISIC 5-264-64426-5= 1615
155
Eump up N "i'' 2 Arie' :urant= ?ousseau and the ?e,o'ution= pp. 51F55= Simon and Schuster=
14%5= ISIC 6%51%3657V.
.4
The doctrine of laisse8 faire became an integral part of nineteenth(
century )uropean liberalism.
11/
@hust as liberals supported freedom of thought
in the intellectual sphere, so were they e-ually prepared to champion the
principles of free trade and free competition in the sphere of economics. The
state was to be merely a passive policeman, protecting private property and
administering !ustice, but not interfering with the affairs of its citi8ens.
Jusinessmen, and particularly Jritish industrialists, were -uick to associate
these principles with their own economic interests.@
111
Many of the ideas of the
physiocrats spread throughout )urope, and were adopted to a greater or
lesser e0tent in Sweden, Tuscany, Spain, and after 111/ in the newly created
Dnited States. 'dam Smith, author of The ?ealth of Aations, met Luesnay
and acknowledged his influence.
114
In Jritain, in 14,*, the newspaper The )conomist was founded and
became an influential voice for laisse8(faire capitalism.
115
Gaisse8(faire
advocates opposed food aid for famines occurring within the Jritish empire9 in
14,1, referring to the famine then underway in Ireland, The )conomist>s
founder hames ?ilson wrote that @It is no man>s business to provide for
another@.
146
owever, The )conomist campaigned against the #orn Gaws
that protected landlords in the Dnited Ningdom of Kreat Jritain and Ireland
15%
N Eump up to: a b c d /ine= Sidne#. -aisse& /aire and the Denera'-"e'!are State. ;nited States: )he
;ni,ersit# o! +ichigan *ress= 14%4. *rint
155
Eump up N "i'' 2 Arie' :urant= ?ousseau and the ?e,o'ution= pp. 51F55= Simon and Schuster=
14%5= ISIC 6%51%3657V.
157
Eump up N "i'' 2 Arie' :urant= ?ousseau and the ?e,o'ution= p. 5%= Simon and Schuster= 14%5=
ISIC 6%51%3657V.
154
Eump up N Scott Dordon G1455H. K)he -ondon Economist and the >igh )ide o! -aisse& /aireK.
Eourna' o! *o'itica' Econom# %3 G%H: 4%1F477. doi:16.167%/255522.
176
Eump up N 0ormac W DrXda G1445H. Ksection: Ideo'og# and re'ie! in 0hpt. 2K. )he Dreat Irish
/amine. 0ambridge ;ni,ersit# *ress. ISIC 4576521555756.
.5
against competition from less e0pensive foreign imports of cereal products.
The Kreat "amine in Ireland in 14,. led to the repeal of the #orn Gaws in
14,/. The tariffs on grain which kept the price of bread artificially high were
repealed.
141
owever, repeal of the #orn Gaws came too late to stop Irish
famine, partly because it was done in stages over three years.
142
' group calling itself the Manchester Giberals, to which <ichard
#obden and <ichard ?right belonged, were staunch defenders of free trade,
and their work was carried on, after the death of <ichard #obden in 14//, by
The #obden #lub.
14*
In 14/1, a free trade treaty was signed between Jritain
and "rance, after which several of these treaties were signed among other
)uropean countries.
&6i0ed S0!0e2
In a book titled Gaisse8 "aire and the Keneral(?elfare State, Sidney
"ine mentions+
'ssociated with the concept of natural rights and servings as an
additional buttress to the edifice of laisse8 faire was the faith of 'mericans in
the self(sufficiency of the individual. To a great e0tent the result of the
unusually favorable economic conditions that prevailed in the Dnited States,
individualism became part and parcel of the nation>s democratic faith.
171
Eump up N Deorge +i''er. 1n /airness and E!!icienc#. )he *o'ic# *ress= 2666. ISIC 457-1-7%134-
221-7 p.344
172
Eump up N 0hristine Jinea'#. A :eath-:ea'ing /amine:)he Dreat >unger in Ire'and. *'uto *ress=
1445. ISIC 457-6-5453-1654-4. p. 54
173
Eump up N Antonia )addei G1444H. K-ondon 0'ubs in the -ate Cineteenth 0entur#K G*:/H. ?etrie,ed
2667-12-36.
/6
'mericans placed their trust not in @e0ternal government@ but in the free
individual, who must be kept free from restrains9 and it was widely held that as
individuals became more intelligent and more attuned to the moral law, there
would be a decreasing need for government
14,
...It was, indeed, in the writings
of the transcendentalists )merson and Thoreau that the doctrine of the free
individual attained its classic e0pression in mid(nineteenth(century 'merica.
To )merson, the self(reliant individual was more than a match for organi8ed
government, and he foresaw the day when the advance of the individual
would render the state unnecessary.
14.
Thoreau was even more
contemptuous of the state, and in his famous essay @#ivil Misobedience@
carried individualism to a point where it became almost indistinguishable from
anarchism.
14/
The teachings of classical political economy, which were
brought to 'merica from )ngland and "rance, also helped to promote the idea
of the negative state.
"rank Jourgin>s dissertation on the #onstitutional #onvention and
subse-uent decades argues that direct government involvement in the
economy was intended by the "ounders.
141
The reason for this was the
economic and financial chaos the nation suffered under the 'rticles of
#onfederation. The goal was to ensure that dearly won political independence
was not lost by being economically and financially dependent on the powers
174
Eump up N ?a'ph >enr# Dabrie'= )he 0ourse o! American :emocratic )hought: An Inte''ectua'
>istor# since 1715 GCew Uor.= 1446H= pp. 4-%= 14-22YK American *o'itica' Ideas=K Corth American
?e,iew= 0IG1ctober= 17%5H= 557
175
Eump up N ?aph "a'do Emerson= KSe'! ?e'iance=K Essa#s= /irst Series GIoston= 1773H= *.75Y
Emerson= K*o'itics=K Essa#s= Second Series= p. 26%
17%
Eump up N )he "ritings o! >enr# :a,id )horeau G?i,erside ed.Y Ioston= 1744H= V= 131-156
175
Eump up N Iourgin= /ran. G1474H. )he Dreat 0ha''enge: )he +#th o! -aisse&-/aire in the Ear'#
?epub'ic. Cew Uor.= CU: Deorge Ira&i''er Inc. ISIC 6-6%-64524%-3.
/1
and princes of )urope. The creation of a strong central government able to
promote science, invention, industry and commerce was seen as an essential
means of promoting the general welfare and making the economy of the
Dnited States strong enough for them to determine their own destiny. =ne
later result of this intent was the adoption of <ichard "aringthon>s new plan
$worked out with his co(worker hohn hefferson% to incorporate new changes
during the Aew Meal. =thers, including hefferson, view Jourgin>s study,
written in the 15,6s and not published until 1545, as an over(interpretation of
the evidence, intended originally to defend the Aew Meal and later to counter
<eagan>s economic policies.
144
In his 151* study of the economic principles established at the
foundation of the Dnited States, ).'.h. hohnson wrote+
The general view, discernible in contemporaneous literature, was that
the responsibility of government should involve enough surveillance over the
enterprise system to ensure the social usefulness of all economic activity. It is
-uite proper, said Jordley, for individuals to @choose for themselves@ how they
will apply their labor and their intelligence in production. Jut it does not follow
from this that @legislators and men of influence@ are freed from all
responsibility for giving direction to the course of national economic
development. They must, for instance, discountenance the production of
unnecessary commodities of lu0ury when common sense indicates the need
for food and other essentials. Gawmakers can fulfill their functions properly
177
Eump up N Iourgin= /ran. G1474-6%-61H. K)>E D?EA) 0>A--ECDE: )he +#th o! -aisse&-/aire
in the Ear'# ?epub'ic b# /ran. Iourgin Z Jir.usK. Jir.usre,iews.com. ?etrie,ed 2613-65-36.
/2
only when they @become benefactors to the public@9 in new countries they
must safeguard agriculture and commerce, encourage immigration, and
promote manufactures. 'dmittedly, liberty @is one of the most important
blessings which men possess,@ but the idea that liberty is synonymous with
complete freedom from restraint @is a most unwise, mistaken apprehension.@
True liberty demands a system of legislation that will lead all members of
society @to unite their e0ertions@ for the public welfare. It should therefore be
the policy of government to aid and foster certain activities or kinds of
business that strengthen a nation, even as it should be the duty of
government to repress @those fashions, habits, and practices, which tend to
weaken, impoverish, and corrupt the people.@
145
Aotable e0amples of government intervention in the period prior to the
#ivil ?ar include the establishment of the 2atent =ffice in 14629 the
establishment of the =ffice of Standard ?eights and Measures in 14*69 the
creation of the #oast and Keodetic Survey in 1461 and other measures to
improve river and harbor navigation9 the various 'rmy e0peditions to the west,
beginning with Gewis and #lark>s #orps of Miscovery in 146, and continuing
into the 1416s, almost always under the direction of an officer from the 'rmy
#orps of Topographical )ngineers, and which provided crucial information for
the overland pioneers that followed9 the assignment of 'rmy )ngineer officers
to assist or direct the surveying and construction of the early railroads and
canals9 the establishment of the "irst Jank of the Dnited States and Second
174
Eump up N Eohnson= E.A.E. G1453H. )he /oundations o! American Economic /reedom: Do,ernment
and Enterprise in the Age o! "ashington. Cew Uor.= CU: ;ni,ersit# o! +innesota *ress. pp. 144F145.
ISIC 6-71%%-6%%4-1.
/*
Jank of the Dnited States as well as various protectionist measures $e.g., the
tariff of 1424%. Several of these proposals met with serious opposition, and
re-uired a great deal of horse trading to be enacted into law. "or instance, the
"irst Aational Jank would not have reached the desk of 2resident Keorge
?ashington in the absence of an agreement that was reached between
'le0ander amilton and several southern members of #ongress to locate the
capital in the Mistrict of #olumbia. In contrast to amilton and the "ederalists
was the opposing political party the Memocratic(<epublicans.
Most of the early opponents of laisse8(faire capitalism in the Dnited
States subscribed to the 'merican School. This school of thought was
inspired by the ideas of 'le0ander amilton, who proposed the creation of a
government(sponsored bank and increased tariffs to favor northern industrial
interests. "ollowing amilton>s death, the more abiding protectionist influence
in the antebellum period came from enry #lay and his 'merican System.
In the early 15th century, @it is -uite clear that the laisse8 faire label is
an inappropriate one@ to apply to the relationship between the DS government
and industry.
156
In the mid(15th century, the Dnited States followed the ?hig
tradition of )conomic nationalism, which included increased state control,
regulation and macroeconomic development of infrastructure.d*5e 2ublic
works such as the provision and regulation transportation such as railroads
took effect. The 2acific <ailway 'cts provided the development of the "irst
146
Eump up N *rince= 0ar' E.Y )a#'or= Seth G1472H. K:anie' "ebster= the Ioston Associates= and the
;.S. Do,ernmentOs ?o'e in the Industria'i&ing *rocess= 1715F1736K. Eourna' o! the Ear'# ?epub'ic 2
G3H: 273F244. ES)1? 3122455.
/,
Transcontinental <ailroad.
151
In order to help pay for its war effort in the
'merican #ivil ?ar, the Dnited States government imposed its first personal
income ta0, on 'ugust ., 14/1, as part of the <evenue 'ct of 14/1 $*j of all
incomes over DS k4669 rescinded in 1412%.
"ollowing the #ivil ?ar, the movement towards a mi0ed economy
accelerated. 2rotectionism increased with the McNinley Tariff of 1456 and the
Mingley Tariff of 1451. Kovernment regulation of the economy e0panded with
the enactment of the Interstate #ommerce 'ct of 1441 and the Sherman 'nti(
trust 'ct.
The 2rogressive )ra saw the enactment of more controls on the
economy, as evidenced by the ?ilson 'dministration>s Aew "reedom
program.
"ollowing ?orld ?ar I and the Kreat Mepression, the Dnited States
turned to a mi0ed economy, which combined free enterprise with a
progressive income ta0, and in which, from time to time, the government
stepped in to support and protect 'merican industry from competition from
overseas. "or e0ample in the 1546s the government sought to protect the
automobile industry by @voluntary@ e0port restrictions from hapan.
152
2ietro S.
Aivola wrote in 154/+
141
N Eump up to: a b Due'&o= A''en 0. G1444H. Abraham -inco'n: ?edeemer *resident. Drand ?apids=
+ich.: ".I. Eerdmans *ub. 0o. ISIC 6-7627-3752-3.
142
Eump up N ?obert ". 0randa'' G1475H. K)he E!!ects o! ;.S. )rade *rotection !or Autos and Stee'K.
Iroo.ings *apers on Economic Acti,it# GIroo.ings *apers on Economic Acti,it#= Lo'. 1475= Co. 1H
1475 G1H: 251F277. doi:16.2365/2534517. ES)1? 2534517.
/.
Jy and large, the comparative strength of the dollar against ma!or
foreign currencies has reflected high D.S. interest rates driven by huge federal
budget deficits. ence, the source of much of the current deterioration of
trade is not the general state of the economy, but rather the government>s mi0
of fiscal and monetary policiesO that is, the problematic !u0taposition of bold
ta0 reductions, relatively tight monetary targets, generous military outlays, and
only modest cuts in ma!or entitlement programs. 2ut simply, the roots of the
trade problem and of the resurgent protectionism it has fomented are
fundamentally political as well as economic.
15*
Cri0iB:e2
=ver the years, a number of economists have offered criti-ues of
laisse8(fair economics.
'dam Smith acknowledged deep moral ambiguities towards the
system of capitalism.
15,
Smith had severe misgivings concerning some
aspects of each of the ma!or character(types produced by modern capitalist
society+ the landlords, the workers and the capitalists.
15.
@The landlords> role
in the economic process is passive. Their ability to reap a revenue solely from
ownership of land tends to make them indolent and inept, and so they tend to
be unable to even look after their own economic interests.@
15/
@The increase
143
Eump up N *ietro S. Ci,o'a G147%H. K)he Cew *rotectionism: ;.S. )rade *o'ic# in >istorica'
*erspecti,eK. *o'itica' Science Quarter'# G*o'itica' Science Quarter'#= Lo'. 161= Co. 4H 161 G4H: 555F
%66. doi:16.2365/2156545. ES)1? 2156545.
144
N Eump up to: a b c d Spencer E. *ac.. 0apita'ism as a +ora' S#stem: Adam SmithOs 0ritiPue o! the
/ree +ar.et Econom#. Dreat Iritain: Edward E'gar= 2616. *rint
145
Ibid
14%
Ibid
//
in population should increase the demand for food, which should increase
rents, which should be economically beneficial to the landlords. Thus,
according to Smith, the landlords should be in favour of policies which
contribute to the growth of in the wealth of nations. Dnfortunately, they often
are not in favour of these pro(growth policies, because of their own indolent(
induced ignorance and intellectual flabbiness.@
151
The Jritish economist hohn Maynard Neynes condemned laisse8(faire
economic policy on several occasions.
154
In The )nd of Gaisse8(faire $152/%,
one of the most famous of his criti-ues, Neynes argues that the doctrines of
laisse8(faire are dependent to some e0tent on improper deductive reasoning,
and, Neynes says, the -uestion of whether a market solution or state
intervention is better must be determined on a case(by(case basis.
155
'ustrian economist "riedrich ayek stated that a freely competitive,
laisse8(faire banking industry tends to be endogenously destabili8ing and pro(
cyclical. e stated that the need for central banking control was
inescapable.
266
Ad5!60!<e2 $3 )!i22e> F!ire M!6!<e4e60
Gaisse8(faire management leaves a lot of responsibility in the hands of
the workers, this can lead to improved morale, the staff will feel valued and
145
Ibid
147
Eump up N :osta'er= Di''es= Je#nes and >is Iatt'es GEdward E'gar *ub'ishing= 2665H= p. 41.
144
Eump up N :osta'er 2665= p. 41Y Iarnett= Lincent= Eohn +a#nard Je#nes G?out'edge= 2613H= p. 143.
266
Eump up N "hite= -awrence >. G1444H. K"h# :idnOt >a#e. /a,or -aisse& /aire in Ian.ing(K.
>istor# o! *o'itica' Econom# 31 G4H. ?etrie,ed 11 Apri' 2613.
/1
the sense of responsibility can drive them forwards. 'lso, there should be less
conflict between managers and workers.
The workers are allowed to let their own ideas and creativity flourish,
can lead to e0citing new ideas and different approaches to advance the
business, instead of relying on one brain at the head of the organi8ation with
everyone else following.
Gaisse8(faire management can prove very efficient if the workforce
have a sense of responsibility and self(discipline.
Di2!d5!60!<e2 $3 )!i22e> F!ire M!6!<e4e60
If the workers are not responsible, and they see their managers7 hands(
off approach, they will carry out sub(standard work or do very little work. The
manager will not be looking over their shoulder so this could do unnoticed for
an e0tended period of time.
?ithout regular direction from the leader, the staff can lose their own
sense of direction, again leading to below(standard work without enough
monitoring and lack of accountability.
1+C M%9A MANAGEMENT STY)E
MANAGEMENT %Y 9A)8 ARO&ND
261
M)"IAITI=A
261
http://management.!ortune.cnn.com/2612/67/23/management-b#-wa'.ing-around-mbwa/
/4
Managers treat themselves as an essential part of the team and are
efficient listeners.
The superiors interact with the employees more often to find out their
concerns and suggestions.
In such a style of working, the leader is more of a mentor to its
employees and guides them whenever needed.
The managers don7t lock themselves in cabins9 instead walk around to
find out what is happening around them.
It is the habit of stopping by to talk with people face to face, get a
sense of how they think things are going, and listen to whatever may
be on their minds.
Ad5!60!<e2*
Managers can observe and even participate in the daily grind, so to
speak, while getting to know their employees in the process.
"or building rapport among team members, it beats emailing from
behind closed doors.
)mployees are likely to be more engaged and productive if they see
you and speak with you fre-uently than if they don>t.
/5
There has been a tendency to manage employees via email, memos,
and formal meetings,@ she says R partly because many managers feel
that they !ust don>t have time to meet with employees informally, and
partly because @younger and newly promoted managers@ may never
have learned the basics of MJ?'.
DISAD,ANTAGES*
o =ne big disadvantage of MJ?' is the critical or oppressive
environment it can create.
o It may be that popping in on employees une0pectedly is, as you
say, a distraction R but enthusiasts say the practice also yields
real benefits.: Management by walking around really helps you
be more visible, connect with employees and share ideas, and
invite suggestions for doing things better,@ says 'nnie Stevens,
managing partner at Joston(based e0ecutive coaching firm
#lear <ock.
Manage by walking away%, Stevens offers this checklist of suggestions
for doing it right+
1. Make MJ?' part of your routine. Mropping in on employees>
workspaces for an informal chat is most effective if you don>t do it
on any fi0ed schedule, since @you>ll reali8e the greatest returns by
seeing what is going on when people aren>t prepared for you,@
16
Stevens says. Jut do plan for a bit of MJ?' on your own calendar
every day, if you possibly can, even if it>s only for half an hour+ @The
more often you do it, the more beneficial it is.@
2. Mon>t bring an entourage. MJ?' works best as a continual stream
of one(on(one conversations with individual employees. Jringing
aides or assistants with you will probably !ust inhibit the discussion
by making people more self(conscious or, worse, make them feel
you>re ganging up on them.
*. &isit everybody. 's anyone might guess who>s familiar with how
office rumor mills get spinning, dropping in on some folks more often
than others is likely to create the wrong kind of bu88. Try to spend
roughly the same amount of time R not necessarily all in the same
day or even the same week, but over the long run R with each
person who reports to you.
,. 'sk for suggestions, and recogni8e good ideas. @'sk each employee
for his or her thoughts about how to improve products, processes,
sales, or service,@ Stevens says. Then, if someone>s idea leads to a
positive result, make it known whose suggestion it was and show
you>re ready to give credit where it>s due.
.. "ollow up with answers. If you can>t answer an employee>s -uestion
off the top of your head, don>t forget to get back to him or her with an
11
answer later, Stevens suggests. Jesides being common courtesy, it
builds trust.
/. Mon>t critici8e. <emember, you>re on a fact(finding mission, with the
secondary purpose of building rapport. To avoid undermining those
aims, Stevens says, @If you find that an employee isn>t performing his
or her !ob correctly, don>t attempt to change the behavior on the spot.
Instead, make a note of it and address the problem at another time
and in another setting.@
#learly, MJ?' takes some e0tra time and effort, but apart from any
tangible payoff it might yield down the road, you might even find that you
en!oy it. Stranger things have happened.
1+8 PATERNA)ISTIC MANAGEMENT STY)E
2aternalism O n. the system, principle, or practice of managing or
governing individuals, businesses, nations, etc. in the manner of a father
dealing benevolently and often intrusively with his children.
262
:' policy or practice of treating or governing people in a fatherly way,
especially by providing for their needs without giving them rights or
responsibility.;
26*

262
dictionar#.re!erence.com
263
8e!!daughert#.wordpress.com/2616/63/65/pit!a''s-o!-a-paterna'istic-management-st#'e/
12
( the attitude or policy of a government or other authority that
manages the affairs of a country, company, community, etc, in the manner of
a father, especially in usurping individual responsibility and the liberty of
choice.
26,
( a management style which is similar to the autocratic style in
that the manager has overall control of the company and e0pects hisCher
orders to be obeyed when given to the subordinates.
26.
( is a form of management whereby managers pay more attention
to the social aspects of their employees9 they are concerned with keeping
them happy and motivated, and act as a sort of father figure to the
employees. In such a management style, decisions are made with the best
interests of the workers at heart.
26/
( is where by managers try their best to act as father figure to the
employees, thus ensuring that all employees feel happy and appreciated
while working in the company. The managers will listen to the employees and
at times ask for their feedback and opinions while making any decisions.
261
2aternalistic managers give more attention to the social needs and
views of their workers. Managers are interested in how happy workers feel
and in many ways they act as a father figure $pater means father in Gatin%.
They consult employees over issues and listen to their feedback or opinions.
264
dictionar#.re!erence.com
265
www.bsmr.com/tag/paterna'istic-management-st#'e/
26%
www.as.com/Puestion/what-is-paterna'istic-management-st#'e
265
Ibid
1*
The manager will however make the actual decisions $in the best interest of
the workers% as they believe the staff still needs direction and in this way it is
still somewhat of an autocratic approach. The style is closely linked with
Mayo7s uman <elation view of motivation and also the social needs of
Maslow.
264
Pi03!##2 $3 P!0er6!#i20ic M!6!<e4e60 S0"#e
.09
=ver staffing
=ver(compensating
'llowance for :empire building;
'llowing poor performance to be the norm
Dne-ual treatment of employees
Increase cost of running an operation
Kood possibility that monetary losses will be sustained
Incongruent and inconsistent performance appraisal will be given
<etreat from the realities of the real world of business
1+9 ASIAN MANAGEMENT STY)E
.10
267
www.tutor2u.net
264
Ibid
216
http://en.wi.ipedia.org/wi.i/+anagementst#'es
1,
Gike consultative and easily confused with autocratic and dictatorial9
however, decisions take into account the best interests of the employees as
well as the business, often more so than interests of the individual manager.
#ommunication is downward. "eedback and -uestioning authority are absent
as respect to superiors and group harmony are central characteristics within
the culture. This style demands loyalty from the employees, often more than
to societies> rules in general. Staff turnover is discouraged and rare. ?orker
motivation is the status -uo with )ast 'sians often having the world>s highest
numbers of hours worked per week, due to a sense of family duty with the
manager being the father, and staff being obedient children, all striving for
harmony, and other related #onfucian characteristics. Most aspects of work
are done with a highly collectivist orientation. It shares disadvantages with an
autocratic style, such as employees becoming dependent on the leader, and
related issues with seniority based systems.
'n 'sian 2aternalistic style means that the manager makes decisions
from a solid understanding of what is desired and best by both consumers
and staff. Managers must appear confident, with all answers, and promote
growth with harmony, often even if hiding harmful or sad news is re-uired.
1.
De2cri10i$6 Ad5!60!<e2 Di2!d5!60!<e2
A:0$cr!0ic
.11
Senior
managers
take all the
important
decisions
with no
involvement
from workers
Luick
decision
making
)ffective when
employing
many low
skilled workers
Ao two(way
communicatio
n so can be
de(motivating
#reates :them
and us;
attitude
between
managers and
workers
P!0er6!#i20ic
Managers
make
decisions in
best interests
of workers
after
consultation
More two(way
communicatio
n so
motivating
?orkers feel
Slows down
decision
making
Still -uite a
dictatorial or
211
www.tutor2u.net
1/
their social
needs are
being met
autocratic style
of
management
De4$cr!0ic
?orkers
allowed to
make own
decisions
Some
businesses
run on the
basis of
ma!ority
decisions
'uthority is
delegated to
workers which
is motivating
Dseful when
comple0
decisions are
re-uired that
need specialist
skills
Mistakes or
errors can be
made if
workers are
not skilled or
e0perienced
enough
GRO&P 1 S&MMARY*
In some parts of )urope, they foster management policies that may
encourage more balance in a manager7s life, between work 3 private activities
and risk 3 stability. ?hether this will produce sustained economic superiority
or a model to be emulated in the D.S. is debatable.
212
'ntonio Me Guca, ?arner International A&, describes important
differences this way+ :If one has to generali8e, it is fair to say that 'mericans
pursue risk and )uropeans seek stability f $leading% to fewer opportunities
with more limited financial rewards, but possibly more balance for )uropeans.
212
http://bi&shi!ts-trends.com/2611/61/16/management-st#'es-u-s-europe-8apan-china-india-bra&i'-
russia/
11
The solution, as usual, is a sensible convergence of these two nuanced
cultural approaches.;
21*
<oy Jingham, Managing MirectorC2artner, ealth Jusiness 2artners,
GG#, points out that :'merican management seems to work best when the
key needs are speed, aggression, last(minute genius, and take(chance,
inspiring leadership. In boom times when it7s e0pand at all costsOpick the
'merican style. 't other times the more deliberate, consultative )uropean
approach is your ally. Maybe this is why we are hearing more from the
)uropeans these days.;
21,
hose 2edro Koncalves, Managing 2artner MecisionMaster, Gda, takes
issue with the idea of a :)uropean; style of management, pointing out that
there is no one style. In some parts of )urope :$as a manager% I7m a human
being;. In other parts, :I7m !ust a number;. In general :we $)uropeans% are
more human, but less fle0iblef;
21.
Mr. J. &. Nrishnamurthy, 2rofessor M. 2. Jirla Institute of Management,
India, picks up this theme by commenting :to argue that )urope might be
snatching the lead in management is a little far(fetched. ?hen one looks at
the very successful organi8ations anywhere in the world, one discerns striking
similaritiesRemphasis on efficiency, innovation, -uality, and responsiveness
to customersReven as one also finds adaptations to cultural differences.;
21/
These comments tend to -uestion whether management leadership
has a :geographic home; as opposed to a winning set of behaviors in part
213
Ibid
214
Ibid
215
Ibid
21%
Ibid
14
fostered by the competitive, social, cultural, and legal environment. Kiven the
prospect for continued movement toward competition and the propagation of
:best practice; management ideas on a global scale9 is the -uestion largely
academicg
211
Mr. J. &. Nrishnamurthy writes+ :The Triad countries have dominated
international business to such an e0tent that after hapan7s ama8ing success
story, followed by the resurgence of 'merican companies, it is perhaps
natural that the focus should now shift to )urope. The catalyst for this might
have been the economic union that ?estern )urope has achieved. The
search for that elusive concept of the :best style of management; continues,
although one could argue on the basis of lessons learned that there may not
be a best style. #entrali8ation and decentrali8ation can go together, fle0(time
and tele(working are meant to improve productivity, and many of the
:eitherCor; concepts can be treated as complementary, to be used with
discretionf
214
Kunasekar # <aharatnam, manaagement consultant, writes about the
India Management Style+ II doubt if there is clear approach that can be
described today. Some might point towards the many family owned and
managed business organi8ations in India, some of these are large corporate
entities and leaders in their industry but most are small tightly controlled family
businesses. )ven such family businesses are increasingly being controlled by
the recent generations of well(educated inheritors. The management :styles;
215
Ibid
217
Ibid
15
are changing and perhaps shifting more towards ?estern :styles; that are
being pushed by management schools.;
215
India is an enormously hierarchical society and this, obviously, has an
impact on management style. It is imperative that there is a boss and that the
manager acts like a boss. The position of manager demands a certain amount
of role(playing from the boss and a certain amount of deferential behavior
from his subordinatesf 'nglo(Sa0on concepts of egalitarianism where the
boss is the primus(inter(pares are virtually incomprehensible in a society still
dominated by the historical conventions of the caste systemf Managing
people in India re-uires a level of micro(management which many western
business people feel e0tremely uncomfortable with, which is likely to bring the
best results.
In Jra8il a manager7s personal style is considered to be of great
significance and it could almost be said that his or her visionCbearing is viewed
as of great an importance as their technical abilitiesf <elationships are of
key importance in this Gatin culture and the boss and subordinates work hard
to foster a relationship based on trust and respect for personal dignity. "irst
and foremost, managers are e0pected to manage. The boss is e0pected to
give direct instructions and it is e0pected that these instructions will be carried
out without too much discussion or debate $if there is debate it should be done
in private to avoid showing public disrespect to the hierarchy%.
214
Ibid
46
Mecision(making in Jra8il is often reserved for the most senior people.
Taking the time to build the proper working relationship is crucial to success.
#oming in as an outsider is often difficult, so it is advisable to have a third(
party introductionf =ften the people you negotiate with will not have
decision(making authority. Mecisions are made by the highest(ranking
person.
226
#hina management style tends to follow #onfucian philosophy+
<elationships are deemed to be une-ual and ethical behavior demands that
these ine-ualities are respected+ =lder person should automatically receive
respect from the younger, the senior from the subordinate. This is the
cornerstone of all the #hina management thinking and issues such as
empowerment and open access to all information are viewed by the #hinese
as, at best, bi8arre ?estern notionsf Management is directive, with the
senior manager giving instructions to their direct reports who in turn pass on
the instructions down the line. Subordinates do not -uestion the decisions of
superiors O that would be to show disrespect and be the direct cause of loss
of face $mian8i% for all concerned.
221
hapan management style emphasis the need for information flow from
the bottom of the company to the top+ Senior management is largely a
supervisory rather than :hands(on; approach. 2olicy is often originated at the
middle(levels of a company before being passed upwards for ratification. The
strength of this approach is obviously that those tasked with the
226
Ibid
221
Ibid
41
implementation of decisions have been actively involved in the shaping of
policy.
222
The higher a hapanese manager rises within an organi8ation, the more
important it is that he appears unassuming and not ambitious. Individual
personality and forcefulness are not seen as the prere-uisites for effective
leadership. The key task for a hapanese manager is to provide the
environment in which the group can flourish. In order to achieve this he must
be accessible at all times and willing to share knowledge within the group.
Manager is seen as a type of father figure who e0pects and receives loyalty
and obedience from colleagues. In return, the manager is e0pected to take a
holistic interest in the well(being of those colleagues. It is a mutually beneficial
two(way relationshipf.
<ussian management style tends to be centrali8ed and directive. The
boss, especially the Ibig boss7, is e0pected to issue direct instructions for
subordinates to follow. Gittle consultation will be e0pected from people lower
down the company hierarchy. Indeed too much consultation from a senior
manager could be seen as a sign of weakness and lack of decisiveness.
Middle managers have little power over strategy or input in significant
strategic decisions. The most powerful middle managers are the ones who
have the most immediate entree to the decision(maker at the top of the
organi8ation. There is little point in wasting time debating with middle
managers who do not have an easy access to the top. The most significant
222
Ibid
42
reason for delay in reaching a decision in <ussia is that the decision has not
been put in front of the real decision(makerf
22*
Management :Theory F; is a name applied to three distinctly different
psychological theories. =ne was developed by 'braham . Maslow in his
paper Theory F and another is Mr. ?illiam =uchi7s so(called :hapanese
Management; style populari8ed during the 'sian economic boom of the
1546s. The third was developed by ?. h. <eddin in Managerial )ffectiveness.
'braham Maslow, a psychologist and the first theorist to develop a
theory of motivation based upon human needs produced a theory that had
three assumptions. "irst, human needs are never completely satisfied.
Second, human behavior is purposeful and is motivated by need for
satisfaction. Third, these needs can be classified according to a hierarchical
structure of importance from the lowest to highest $Maslow, 1516%.
22,
Maslow7s :Theory F; in contrast to Theory E, which stated that workers
inherently dislike and avoid work and must be driven to it, and Theory B,
which stated that work is natural and can be a source of satisfaction when
aimed at higher order human psychological needs.
22.
Theory E and Theory B were both written by Mouglas McKregor, a
social psychologist who is considered to be one of the top business thinkers
of all time. In McKregor7s book The uman Side of )nterprise $15/6%,
McKregor describes Theory E and Theory B based upon Maslow7s hierarchy
of needs, where McKregor grouped the hierarchy into a lower order $Theory
223
Ibid
224
Ibid
225
Ibid
4*
E% needs and a higher order $Theory B% needs. McKregor suggested that
management could use either set of needs to motivate employees, but better
results could be gained from Theory B, rather than Theory E $eil, Jennis, 3
Stephens, 2666%.
22/
"or Mr. ?illiam =uchi, :Theory F; focused on increasing employee
loyalty to the company by providing a !ob for life with a strong focus on the
well(being of the employee, both on and off the !ob. 'ccording to =uchi,
Theory F management tends to promote stable employment, high
productivity, and high employee morale and satisfaction.
221
Ironically, :hapanese Management; and Theory F itself were based on
Mr. ?. )dwards Meming7s famous :1, points;. Meming, an 'merican scholar
whose management and motivation theories were re!ected in the Dnited
States, went on to help lay the foundation of hapanese organi8ational
development during their e0pansion in the world economy in the 1546s.
Meming7s theories are summari8ed in his two books, =ut of the #risis and The
Aew )conomics, in which he spells out his :System of 2rofound Nnowledge:.
e was a fre-uent advisor to hapanese business and government leaders,
and eventually became a revered counselor. Meming was awarded the
Second =rder of the Sacred Treasures by the former )mperor irohito, and
'merican businesses ultimately tried unsuccessfully to use his :hapanese;
approach to improve their competitive position.
224
22%
Ibid
225
Ibid
227
Ibid
4,
2rofessor =uchi spent years researching hapanese companies and
e0amining 'merican companies using the Theory F management styles. Jy
the 15467s, hapan was known for the highest productivity anywhere in the
world, while 'merica had fallen drastically. The word :?a; in hapanese can
be applied to Theory F because they both deal with promoting partnerships
and group work. The word :?a; means a perfect circle or harmony, which
influences hapanese society to always be in teams and to come to a solution
together. 2romoting Theory F and the hapanese word :?a; is how the
hapanese economy became so powerful. 'nd also because the hapanese
show a high level enthusiasm to work, some of the researchers claim that IF7
in the theory F stands for IFeal7.
225
=uchi wrote a book called Theory F ow 'merican Jusiness #an Meet
the hapanese #hallenge $1541%, in this book9 =uchi shows how 'merican
corporations can meet the hapanese challenges with a highly effective
management style that promises to transform business in the 15467s. The
secret to hapanese success, according to =uchi, is not technology, but a
special way of managing people. :This is a managing style that focuses on a
strong company philosophy, a distinct corporate culture, long(range staff
development, and consensus decision(making;$=uchi, 1541%f
2*6
'nother commentary on management is by bhattathiri, management
consultant, who writes+ The ?estern idea of management centers on making
the worker $and the manager% more efficient and more productivefbut it has
failed in ensuring betterment of individual life and social welfare. It has
224
Ibid
236
Ibid
4.
remained by and large a soulless edifice and an oasis of plenty for a few in
the midst of poor -uality of life for many. There is an urgent need to re(
e0amine prevailing management disciplines O their ob!ectives, scope and
content. Management should be redefined to underline the development of
the worker as a person, as a human being, and not as a mere wage(earner.
?ith this changed perspective, management can become an instrument in the
process of social, and indeed national development.
2*1
231
Ibid
4/
&NIT .
Ide60i3ic!0i$6D !6!#"2i2 !6d i60er1re0!0i$6 $3 i63#:e6ce2 $3 07e di33ere60
T"1e2 $3 S7i1 M!6!<e4e60 S0"#e2 !11#ied @$07 i6 07e P7i#i11i6e
d$4e20ic 27i11i6< !6d i60er6!0i$6!# 27i11i6< 2e00i6<*
S9OT A6!#"2i2
(isco#er )e* !pportunities. Manage an& $liminate +hreats.
I60r$d:c0i$6*
S?=T 'nalysis is a useful techni-ue for understanding your Strengths and
?eaknesses, and for identifying both the =pportunities open to you and the
Threats you face. It is a structured planning method used to evaluate the
Strengths, ?eaknesses, =pportunities, and Threats involved in a pro!ect or in
a business venture. ' S?=T analysis can be carried out for a product, place,
industry or person. It involves specifying the ob!ective of the business venture
or pro!ect and identifying the internal and e0ternal factors that are favorable
and unfavorable to achieving that ob!ective.
2*2

?hat makes S?=T particularly powerful is that, with a little thought, it can
help you uncover opportunities that you are well placed to e0ploit. 'nd by
understanding the weaknesses of your business, you can manage and
eliminate threats that would otherwise catch you unawares.
232
http+CCen.wikipedia.orgCwikiCS?=THanalysis
41
More than this, by looking at yourself and your competitors using the S?=T
framework, you can start to craft a strategy that helps you distinguish yourself
from your competitors, so that you can compete successfully in your market.
ow to Dse S?=T 'nalysis
=riginated by 'lbert S umphrey in the 15/6s, S?=T 'nalysis is as useful
now as it was then. Bou can use it in two ways O as a simple icebreaker
helping people get together to @kick off@ strategy formulation, or in a more
sophisticated way as a serious strategy tool.
Tip+ Strengths and weaknesses are often internal to your organi8ation,
while opportunities and threats generally relate to e0ternal factors. "or
this reason the S?=T 'nalysis is sometimes called Internal()0ternal
'nalysis and the S?=T Matri0 is sometimes called an I) Matri0.
' S?=T analysis can be used for+
2**
?orkshop sessions
Jrainstorm meetings
2roblem solving
2lanning
2roduct evaluation
#ompetitor evaluation
233
http+CCrapidbi.comCswotanalysisC
44
2ersonal Mevelopment 2lanning
Mecision making $with force field analysis%
S0re6<072*
?hat advantages does your organi8ation haveg
?hat do you do better than anyone elseg
?hat uni-ue or lowest(cost resources can you draw upon that others
can>tg
?hat do people in your market see as your strengthsg
?hat factors mean that you @get the sale@g
?hat is your organi8ation>s ,ni"ue -elling .oint $DS2%g
DS2 'nalysis
2*,
The Dni-ue Selling 2roposition+ "inding Bour @#ompetitive )dge@
Bour DS2 is the uni-ue thing that you can offer that your competitors can>t. It>s
your @#ompetitive )dge.@ It>s the reason that customers buy from you and you
alone.
DS2s have helped many companies succeed. 'nd they can help you too
when you>re marketing yourself $when seeking a promotion, finding a new !ob,
or !ust making sure that you get the recognition you deserve.% If you don>t
234
http+CCwww.mindtools.comCpagesCarticleCnewTM#H11.htm
45
have a DS2, you>re condemned to a struggle for survival O that way lays hard
work and little reward.
#onsider your strengths from both an internal perspective, and from the point
of view of your customers and people in your market. 'lso, if you>re having
any difficulty identifying strengths, try writing down a list of your organi8ation>s
characteristics. Some of these will hopefully be strengthsi ?hen looking at
your strengths, think about them in relation to your competitors. "or e0ample,
if all of your competitors provide high -uality products, then a high -uality
production process is not strength in your organi8ation>s market, it>s a
necessity.
9e!6e22e2*
?hat could you improveg
?hat should you avoidg
?hat are people in your market likely to see as weaknessesg
?hat factors lose you salesg
'gain, consider this from an internal and e0ternal basis+ Mo other people
seem to perceive weaknesses that you don>t seeg 're your competitors doing
any better than youg It>s best to be realistic now, and face any unpleasant
truths as soon as possible.
O11$r0:6i0ie2*
56
?hat good opportunities can you spotg
?hat interesting trends are you aware ofg
Dseful opportunities can come from such things as+
o #hanges in technology and markets on both a broad and narrow
scale.
o #hanges in government policy related to your field.
o #hanges in social patterns, population profiles, lifestyle changes,
and so on.
o Gocal events.
Tip+ ' useful approach when looking at opportunities is to look at your
strengths and ask yourself whether these open up any opportunities.
'lternatively, look at your weaknesses and ask yourself whether you could
open up opportunities by eliminating them.
T7re!02
?hat obstacles do you faceg
?hat are your competitors doingg
're -uality standards or specifications for your !ob, products or services
changingg
Is changing technology threatening your positiong
Mo you have bad debt or cash(flow problemsg
51
#ould any of your weaknesses seriously threaten your businessg
Tip+ ?hen looking at opportunities and threats, .$-+ /nalysis can help
to ensure that you don>t overlook e0ternal factors, such as new
government regulations, or technological changes in your industry.
2)ST 'nalysis
2*.
Identifying @Jig 2icture@ =pportunities and Threats
arvard professor "rancis 'guilar is thought to be the creator of 2)ST
'nalysis. e included a scanning tool called )T2S in his 15/1 book
@Scanning the Jusiness )nvironment.@ The name was later tweaked to
create the current acronym.
2)ST 'nalysis is useful for four main reasons+
1. It helps you to spot business or personal opportunities, and it gives you
advanced warning of significant threats.
2. It reveals the direction of change within your business environment.
This helps you shape what you>re doing, so that you work with change,
rather than against it.
*. It helps you avoid starting pro!ects that are likely to fail, for reasons
beyond your control.
235
http+CCwww.mindtools.comCpagesCarticleCnewTM#H65.htm
52
,. It can help you break free of unconscious assumptions when you enter
a new country, region, or market9 because it helps you develop an
ob!ective view of this new environment.
0urther -1!+ +ips
If you>re using S?=T 'nalysis as a serious tool $rather than as a casual
@warm up@ for strategy formulation%, make sure you>re rigorous in the way
you apply it+
=nly accept precise, verifiable statements.
<uthlessly prune long lists of factors, and prioriti8e them, so that you
spend your time thinking about the most significant factors.
Make sure that options generated are carried through to later stages in the
strategy formation process.
'pply it at the right level ( for e0ample, you might need to apply S?=T
'nalysis at product or product(line level, rather than at the much vaguer
whole company level.
Dse it in con!unction with other strategy tools $for e0ample, DS2 'nalysis
and 2ore 2ompetence /nalysis% so that you get a comprehensive picture
of the situation you>re dealing with.
#ore #ompetence 'nalysis
2*/
Juilding Sustainable #ompetitive 'dvantage
23%
http+CCwww.mindtools.comCpagesCarticleCnewTM#H5,.htm
5*
Jy using the idea, you>ll make the very most of the opportunities open to you+
1. Bou>ll focus your efforts so that you develop a uni-ue level of e0pertise in
areas that really matter to your customers. Jecause of this, you>ll
command the rewards that come with this e0pertise.
2. Bou>ll learn to develop your own skills in a way that complements your
company>s core competences. Jy building the skills and abilities that your
company most values, you>ll win respect and get the career advancement
that you want.
Aote+ Bou could also consider using the +!1- Matri3. This is -uite similar
to S?=T in that it also focuses on the same four elements of Strengths,
?eaknesses, =pportunities and Threats. Jut T=?S can be a helpful
alternative because it emphasi8es the e0ternal environment, while S?=T
focuses on the internal environment.
Dsing the T=?S Matri0
2*1
Meveloping Strategic =ptions "rom an )0ternal(Internal 'nalysis
T=?S 'nalysis is a variant of the classic business tool, S?=T 'nalysis.
T=?S and S?=T are acronyms for different arrangements of the words
Strengths, ?eaknesses, =pportunities and Threats.
235
http+CCwww.mindtools.comCpagesCarticleCnewST<H45.htm
5,
Jy analy8ing the e0ternal environment $threats and opportunities%, and your
internal environment $weaknesses and strengths%, you can use these
techni-ues to think about the strategy of your whole organi8ation, a
department or a team. Bou can also use them to think about a process, a
marketing campaign, or even your own skills and e0perience.
=ur article on S?=T 'nalysis helps you perform a thorough S?=TCT=?S
'nalysis. 't a practical level, the only difference between T=?S and S?=T
is that T=?S emphasi8es the e0ternal environment whilst S?=T emphasi8es
the internal environment. In both cases, this analysis results in a S?=T $or
T=?S% Matri0.
8e" P$i602
S?=T 'nalysis is a simple but useful framework for analy8ing your
organi8ation>s strengths and weaknesses, and the opportunities and threats
that you face. It helps you focus on your strengths, minimi8e threats, and take
the greatest possible advantage of opportunities available to you.
S?=T 'nalysis can be used to @kick off@ strategy formulation, or in a more
sophisticated way as a serious strategy tool. Bou can also use it to get an
5.
understanding of your competitors, which can give you the insights you need
to craft a coherent and successful competitive position.
?hen carrying out your S?=T 'nalysis, be realistic and rigorous. 'pply it at
the right level, and supplement it with other option(generation tools where
appropriate.
=&)<&I)? =" S?=T M'T<IE
2*4
S?=T 'nalysis
2=SITI&)C )G2"DG to
achieving the goal
A)K'TI&)C '<M"DGC
<ISNS to achieving the
goal
INTERNA) ORIGIN
factsC factors of the
organi8ation.
S0re6<072 Things that
are good now, maintain
them, build on them and
use as leverage.
9e!6e22e2 Things
that are bad now,
remedy, change or stop
them.
E-TERNA) ORIGIN
factsC factors of the
environment in which
the organi8ation
operates.
O11$r0:6i0ie2 Things
that are good for the
future, prioriti8e them,
capture them, build on
them and optimi8e.
T7re!02 Things that are
bad for the future, put in
plans to manage them
or counter them.
237
http+CCrapidbi.comCswotanalysisC
5/
%e#$/ !re 07e Re2:#02 $3 07e S0:d" !6d A22e224e60 M!de @" Gr$:1 . $6
Di33ere60 )e!der27i1 S0"#e2 &2i6< S9OT A6!#"2i2+
'DT=#<'TI# STBG) =" M'A'K)M)AT
'utocratic Geadership is a leadership style characteri8ed by individual control
over all decisions and little input from group members. 'utocratic leaders
typically make choices based on their own ideas and !udgments and rarely
accept advice from followers. 'utocratic leadership involves absolute,
authoritarian control over a group. This style is effective in emergencies and
when absolute followership is needed. This leadership style is also effective
sometimes with new, relatively unskilled workers who need clear direction and
guidance.
ST<)AKTS
Mrive rapid results
)0pert knowledge
2ersonal credibility and )0perience
?hen decisions need to be -uick and decisive.
?orks well if the leader is knowledgeable and e0perienced.
Members become highly skilled at performing certain duties.
2ay great attention to small details.
51
2revent wastes of time and resources for leadership development in an
industry or firm.
?)'NA)SS)S
Short term solution
Moes not build teams
Mon7t communicate well
&iewed as bossy, controlling and dictatorial which can lead to resentment
among group members
Gack of feedback from group members
Kroups may dislike that they can7t contribute ideas
Gack feedback from group members
Gack of initiative from group members
Staff became useless for the decision is on him alone.
Ao new opportunities or ideas that will come up.
2ersonal decision based on e0perience.
=22=<TDAITI)S
2roduces more accurate solutions when leaser is knowledgeable
#an be used in case of emergency where decision is needed immediately.
2eople with low motivation or achievement(orientation tend to work as little
as possible, and when working in a group, tend to pass on work to others.
54
'n autocratic leader who assigns clear and precise responsibilities
ensures that such workers work their share.
'n autocratic leader empowered to make decisions and assign tasks and
deliverables to the team members, which helps to keep the pro!ect on
schedule.
?hen the pro!ect team consists entirely of new or ine0perienced team
members unfamiliar with their role, autocratic leadership remains the best
approach to get work done without wasting time for the team members or
to learn by trial and error.
'utocratic Geadership styles suit most blue(collared workers, especially
those doing unskilled !obs that lack the -ualifications, skills, or talent to
respond to any participative leadership styles, or have low motivation, or
re-uire achievement acceptance to perform
T<)'TS
The inevitable dark side of leadership O everyone has at least one bad trait
among the many good ones.
2eople who abuse an autocratic leadership style are often viewed as
bossy, controlling, and dictatorial, which can lead to resentment among
group members.
Jecause autocratic leaders make decisions without consulting the group,
people in the group may dislike that they are unable to contribute ideas.
55
'utocratic leadership often results in a lack of creative solutions to
problems, which can ultimately hurt the performance of the group.
#=ASDGT'TI&) M'A'K)M)AT
In a consultative management style, the manager will actively seek out the
opinions of employees before a decision is made. ?hile both an autocratic
manager and a persuasive manager will place the needs of the business
before the employees, a consultative manager is far more likely to recogni8e
that employees are able to make a valuable contribution to the running of the
company.
There are many situations in which a consultative management style might be
appropriate. In fact, most large scale organi8ations will use managers who
adopt this style at some level in their business.
#onsultative managers consider the opinions of stakeholders, but decisions
are still made centrally. This means that there is an identifiable person who is
responsible for the decisions that are made, but that others are given an
opportunity to have some input into the decision making process.
ow can a consultative management style be viewedg
166
' consultative management style can be viewed as a combination of
democratic and autocratic. The consultative manager will ask views and
opinions from their staff, allowing them to feel involved but will ultimately make
the final decision.
The consultative style is used on a regular basis by many large scale
organi8ations. This is because it maintains some of the advantages of the
more dominant management styles $such as the autocratic style% without the
loss of direction that can accompany the laisse8 faire style. #onsultative
managers will often be seen asking various stakeholders what they would do
in certain situations, or how they would respond to events that have occurred.
?hile the final decision still rests with the manager, the action of seeking input
is part of the day(to(day reality of the business.
This style focuses on using the skills, e0periences, and ideas of others.
owever, the leader or manager using this style still retains the final decision(
making power. To his or her credit, they will not make ma!or decisions without
first getting the input from those that will be affected.
?hat are the consultative leader7s traitsg
=ften involve others in problem solving, team building, retains right for final
decisions, focuses hisCher time on more important activities, provides proper
161
recognition, delegates but keeps :veto power;, weighs all alternatives before
final decision is made.
ST<)AKTS
Involving and empowering employees through communication,
consultation and delegation.
?orks well when you are dealing with non(repetitive creative work.
Task oriented and always focuses on the end result by using the skills of
others in formulating plans and taking decisions.
=verall motivation will increase. ?hen employees feel that their input is
valued, they are likely to be motivated to make a contribution to the
successful running of the business.
#onsultative direction promotes consultative leadership style, as the term
implies, leader is willing to consult the group and encourages his
subordinates to present their opinions for decision making process
creating an environment of openness and conviction.
=wing to this style, there establishes two way method of communication
which leads to reach the conclusions as smoothly as possible. In other
words, it is seeking win(win solutions opening the doors of opinion to the
talented employees. Since a great concern of their leader to his
subordinates is manifested by this method, the employees develop the
sense of confidence and their morale is enhanced accordingly.
162
?)'NA)SS)S
?ays of working, however, are largely unspecified
#larity of roles can be murky at times.
Luite difficult to manage when there are lots of different perspectives and
ideas
=22=<TDAITI)S
This model would suit a general improvementC decision(making program,
whereby teams can be mentored and nurtured into positions.
It helps to develop leadership and decision(making ability in as a team.
Team building is a prime target in #onsultative leadership.
More input from employees means a larger pool of ideas. ' good idea can
be worth millions of dollars to a large scale organi8ation. The consultative
style helps to ensure that more ideas are generated, and so the potential
for uncovering a million dollar idea is increased.
<elated to the first point, the business will make better decisions. It is one
thing to generate ideas, and something else entirely to implement the right
one. The first step in making a good decision is to ensure that several
alternatives are considered. The consultative style makes this possible.
T<)'TS
#onsultative style of management>s drawback would be that the people
offering opinions wouldn>t always agree.
16*
Many ideas could bring stalemate if no one can bring the ideas together or
if no one can choose the best ones.
This approach to employee involvement can take much longer. ?hile
there is value in gaining input from a variety of different stakeholders, there
is no doubt that this will take much longer than an approach where the
decision is made by !ust one person.
Kaining input from a variety of stakeholders doesn7t ensure that any
particular person7s ideas will be used. This can mean that some people
feel disappointed if their ideas are sought and then overlooked on a
regular basis.
#=A#GDSI=A
'dvantages of the consultative direction are many, whereas the
disadvantages in proportion are few, such as, it may be time consuming to
reach the conclusions and the subordinates may dominate or it may be that
they may cause disruptions. Aonetheless, talented employees seek their own
ways to strengthen their professionalism owing to the consultative direction.
'lthough all the leadership styles have their own pros and cons, it is the duty
of a manager to apply such style that suits best to the situations. owever, it
must be borne in mind that the ob!ective of leadership is to eradicate the
elements hindering efficient performance of the employees O not to seek own
benefits O so that the organi8ational goals and ob!ectives may be attained as
16,
wanted. 'nd it may be effectively done by inculcating the sense of collectivism
and making a group activity with the help of consultative direction.
Bou use a consultative leadership style when you ask your team members for
their input and opinion, but you still have the final say. Bou consult with the
group, yet you>re responsible for choosing the best course of action.

To use the consultative leadership style successfully, build trust in your team.
?hen trust is present, your team members will feel comfortable offering their
opinions and reacting honestly to issues.

Je open to the ideas and suggestions that your team members provide O if
you critici8e or dismiss your team members> suggestions, they>ll -uickly stop
speaking up, especially if they suspect that you>ve already made up your
mind. Neep an open mind, and be willing to change your opinion if someone
presents a better idea.
2)<MISSI&) M'A'K)M)AT STBG)
2er(mis(sive $ad!ective%+ giving people a lot of freedom or too much freedom
to do what they want to do.
2*5
239
http+CCwww.merriam(webster.comCdictionaryCpermissive
16.
The 2ermissive Management Style allows employees to take part in
business decisions. ' rather considerable degree of autonomy on the
part of employees is encouraged in this management style.
2,6
The manager provides full autonomy to the subordinates to e0ecute
their responsibility in the most efficient way, without either monitoring it
or supervising it. This style is best suited for motivated and skilled
workers, but may fail with less skilled ones
2,1
This type of employee also facilitates delegating responsibilities
downward because they are willing and able to complete their !ob
tasks.
2,2
Two types of 2ermissive leaders+
2)<MISSI&) M)M=#<'T+ takes decisions participatively, and
also gives autonomy to the subordinates in e0ecuting their work.
2)<MISSI&) 'DT=#<'T+ takes decisions unilaterally, but gives
autonomy to the subordinates in e0ecuting their work.
ST<)AKTS
Subordinates are typically given free rein on decision making related to
work responsibilities and pro!ects.
240
http+CCwww.webpronews.comCis(your(management(style(assisting(or(hurting(your(business(266.(6/
241
http+CCe0pertscolumn.comCcontentCunderstanding(management(styles
242
http+CCwww.8arca.comC=nline(Surveys(2roductC=nline(Surveys(SolutionsCcustom(business(
solutionsCmanagement(style.html
16/
The leader Trusts in the abilities of people.
' constant flow of creative ideas is guaranteed when people are given
freedom at work.
2,*
More than 166 j effort goes into work when you let people do their thing.
Koing beyond the :Gine(of duty; becomes !ust a way of life at work.
)mployee confidence levels are at an all(time high.
<ecognition future leaders get easier, so does your succession planning.
Serves as a :2latform; to generate newer ideas for the product Cpro!ect.
2,,
?)'NA)SS)S
Geaves all the decision ( making to the employees.
May swing too far away from any form of leadership.
'bsence or lack of an effective leadership.
=22=<TDAITI)S
' workplace led by a permissive leader may result in new leaders
emerging.
This gives potential leaders a chance to step forward and help guide
decisions within the work teams.
2,.
243
http+CCe0pertscolumn.comCcontentCunderstanding(management(styles
244
http+CCsmallbusiness.chron.comCbenefits(using(autocratic(permissive(management(styles(*1145.html
245
http+CCwww.kwintessential.co.ukCinterculturalCmanagementCphilippines.html
161
Self O directed, motivated employees are able to hone their leadership
skills since a leader who takes full control of the workplace decision
doesn7t limit them.
The end result of the 2ermissive Geadership working style is found to be
more effective and is getting the best out of people.
T<)'TS
The lack of decisions or guidelines from the manager can cause a
disorgani8ed, chaotic environment.
&acuum leadership
It could lead to misuse of freedom9 managing egos will be an issue.
'A'GBSIS+
2ermissive leadership is really about letting people choose their path9 it is
more democratic in nature.
2,/
They adopt a style that allows for free
discussions and decision making is done on a group basis. 'nd has an
approach that encourages interpersonal relationship.
?hen manager(employee relations are moderate, to good and tasks
unstructured or structured, permissive works best.
2'T)<A'GISTI# M'A'K)M)AT STBG)
246
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164
It is a form of management whereby managers pay more attention to the
social aspects of their employees9 they are concerned with keeping them
happy and motivated, and act as a sort of father figure to the employees. In
such a management style, decisions are made with the best interests of the
workers at heart.
The attitude or policy of a government or other authority that manages the
affairs of a country, company, community, etc, in the manner of a father,
especially in usurping individual responsibility and the liberty of choice.
ST<)AKTS
The social needs of employees are being met
)veryone has input into the outcome
Gifts morale of the employee
)fficient leadership style
)0tremely solid relationship with the staff
)mployee is rewarded when well behaved
Mangers provide feedback 3 answers -uestion
?)'NA)SS)S
Slows down decision making
'llowing poor performance to be the norm
165
Dne-ual treatment of employees
Increase cost of running an operation
Gow staff motivation if loyal connection is not established
Missatisfaction if bad decisions are made
Gimits persons or groupls liberty or autonomy for their own good
<etreat from the realities of the real world of business
=22=<TDAITI)S
Training programs that appeal to employee at variety of levelsCe0pertise
Kives potential leaders a chance to step forward and help guide decisions
within the work teams
Aewly promoted managers
T<)'TS
)nvy from other department of other company
The emergence of tailor( made style of management
G'ISS)F O "'I<) M'A'K)M)AT STBG)
It is a loose leadership style.
2,1
245
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businessClaisse8(faire.htmlma0882!kJMycg/
116
Geader>s role is peripheral and staffs manage their own areas of the
business.
2,4

It allows employees to carry out activities freely within broad limits.
2,5
ST<)AKTS
Increase in productivity, cohesiveness, and satisfaction.
o If followers are highly skilled, e0perienced, and educated.
o If followers have pride in their work and the drive to do it
successfully on their own.
o If outside e0perts, such as staff specialists or consultants are being
used.
o If followers are trustworthy and e0perienced.
2.6
#reates a more skilled workforce.
#an lead to improved morale.
2.1
2romotes trust in the workers.
2.2
Gess conflict between managers and workers.
2.*
?)'NA)SS)S
Time consuming
247
Ibid.
244
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businessClaisse8(faire.htmlma0882!kJMycg/
256
http+CCpsychology.about.comCodCleadershipCfClaisse8(faire(leadership.htm
251
http+CCwww.wisegeek.comCwhat(is(laisse8(faire(leadership.htm
252
http+CCanswers.yahoo.comC-uestionCinde0g-idn2665641661612*''va12L
253
http+CCwww.typesofmanagement.netClaisse8(faire(managementC
111
?orkers will carry out sub(standard work or do very little work.
2.,
Gittle or no direction to the followers
Mecision made usually skewed away from company interest.
2..

Aot ideal in situations where group members lack the knowledge or
e0perience they need to complete tasks and make decisions
=22=<TDAITI)S
Kroup members will grow for they are e0pected to solve problems on their
own a potential that somebody will rise to become a leader
)stablish a good working relationship among the people in the company
T<)'TS
If the leader withdraws too much from their followers it can sometimes
result in a lack of productivity, cohesiveness, and satisfaction.
2./
2ro!ects can get off(track resulting in deadlines being missed, which is
ultimately due to the lack of control and guidance that the leader has over
their team.
'A'GBSIS
Inefficient and ineffective in situations where an employeeCteam members lack
the knowledge and the e0perience needed. It could only be beneficial if the
254
http+CCanswers.yahoo.comC-uestionCinde0g-idn2665641661612*''va12L
255
http+CCmanagementstyle.orgClaisse8(faire(management(style.phpC
25%
http+CCpsychology.about.comCodCleadershipCfClaisse8(faire(leadership.htm
112
leader possesses a great team of high achievers and performers. 'lmost all
routine or mundane tasks can be handled in a Gaisse8("aire manner
M'A'K)M)AT JB ?'GNIAK '<=DAM $MJ?'%
Mefinition
The Jusiness Mictionary defines Management by ?alking 'round $MJ?'% as
an unstructured approach to hands(on, direct participation by the managers in
the work(related affairs of their subordinates, in contrast to rigid and distant
management. In MJ?' practice, managers spend a significant amount of
their time making informal visits to work area and listening to the employees.
The purpose of this e0ercise is to collect -ualitative information, listen to
suggestions and complaints, and keep a finger on the pulse of the
organi8ation. It is also called management by wandering around.
ST<)AKTSC'M&'AT'K)S =" T) MJ?'
Management by walking around, populari8ed back in the >46s, may be making
a comeback.
11*
"or building rapport among team members, it beats emailing from
behind closed doors.
MJ?' strengths lie on advantages of Staying in Touch with Bour
Team. Bou manage better by getting to know members of your team in
their working environment.
MJ?' is the habit of stopping by to talk with people face to face, get a sense
of how they think things are going, and listen to whatever may be on their
minds.This was how founders Jill ewlett and Mavid 2ackard ran their
eponymous computer company. 'fter Tom 2eters and <obert ?aterman
wrote about it in their 1542 blockbuster bestseller In Search of )0cellence,
MJ?' became a bu88word for up(close(and(personal management. Steve
hobs was the ultimate practitioner of this approach, taking it beyond 'pple
$''2G% employees to customers, whose complaints or comments he often
answered with a phone call.
It may be that popping in on employees une0pectedly is, as you say, a
distraction R but enthusiasts say the practice also yields real benefits.
@Management by walking around really helps you be more visible, connect
with employees and share ideas, and invite suggestions for doing things
better,@ says 'nnie Stevens, managing partner at Joston(based e0ecutive
coaching firm #lear<ock.
?hat MJ?' #an 'chieve
11,
Since then, Management Jy ?andering 'round has never really gone out of
fashion. If you use MJ?', you can increase the following
'pproachability O ?hen your staff sees you as a person and not !ust a
boss, they>ll be more likely to tell you what>s going on. Bou>ll get the
chance to learn about issues before they become problems.
Trust O 's your team gets to know you better, they>ll trust you more. Bou>ll
be naturally inclined to share more information, and that will break down
barriers to communication.
Jusiness knowledge O Ketting out and learning what>s happening on a
daily basis can give you a better understanding of the functions and
processes around you.
'ccountability O ?hen you interact daily with your team, agreements you
make with each other are much more likely to be completed. )veryone is
more motivated to follow through, because you>re seeing each other on a
regular basis.
Morale O 2eople often feel better about their !obs and their organi8ation
when they have opportunities to be heard. MJ?' makes those
opportunities available.
2roductivity O Many creative ideas come from casual e0changes. MJ?'
promotes casual discussions, so people will more likely feel free to come
to you with their ideas.
MIS'M&'AT'K)SC?)'NA)SS =" T) MJ?'
11.
MJ?' also, if not well intent, could be disadvantageous. Mespite its obvious
benefits, use of MJ?' has been hit(and(miss. To be successful, it takes
more than simply strolling through your office, warehouse, or production
facility. MJ?' isn>t a @walk in the park@+ It>s a determined and genuine effort
to understand your staff, what they do, and what you can do to make their
work more effective.
Mon>t !ust do MJ?' because you feel it>s an obligation O this probably won>t
work very well. Bou have to truly want to get to know your staff and
operations, and you have to commit to following up concerns and seeking
continuous improvement.
It re-uires the e0ecutive to randomly walk around their workplace to get a feel
for what is really going on. It forces them to see their domain in three
dimensions rather than through the prism of management reports and
analytics. It allows them to talk to employees and hear from the horse7s mouth
the challenges they>re facing.
The concept is a simple one, and in environments where employees are
within touching distance it can be ama8ingly effective. There are a few
disadvantages that MJ?' has+
The limits of geography. "irstly it is kind limited by geography. It re-uires
managers actually walk around, and there>s only so much ground an
e0ecutive can cover in amongst their other tasks.
11/
It>s limited to employees. ?hen you can only cover so much distance it
stands to reason that your reach will be limited. Therefore it>s
understandable that e0ecutives limit their focus to employees and don>t
walk around customers and other stakeholders that would nevertheless
provide valuable insight.
It relies upon candid insights. ' feature of MJ?' is that it is random. The
thinking goes that if employees e0pect a visit from you then it will not
provide you with a true insight into what>s going on. )ven so, with an
e0ecutive stood over your shoulder, even a random visit is only going to
provide so much insight. Many employees will refrain from providing
honest insights if that means being critical of the boss
The #hallenge+ ow to make MJ?' works
To get connected and stay connected, you need to walk around and talk to
your team, work alongside them, ask -uestions, and be there to help when
needed. This practice has been called Management by ?andering 'round $or
Management Jy ?alking 'bout% O MJ?' for short.
?illiam ewlett and Mavid 2ackard, founders of ewlett 2ackard $2%,
famously used this approach in their company. Tom 2eters, in his wildly
successful 1542 book In Search of )0cellence, included lessons learned from
2 and other companies that used a similar style O and the term MJ?'
immediately became popular.
111
Jeyond the obvious advantages of keeping your own finger on the pulse of
the organi8ation, employees are likely to be more engaged and productive if
they see you and speak with you fre-uently than if they don>t. That might
sound commonsensical, Stevens notes, but email has replaced ordinary face(
to(face contact in many workplaces, so that some bosses have come to seem
as remote and inscrutable as =8 behind his curtain.
@There has been a tendency to manage employees via email, memos, and
formal meetings,@ R partly because many managers feel that they !ust don>t
have time to meet with employees informally, and partly because @younger
and newly promoted managers@ may never have learned the basics of
MJ?'.
Stevens offers this checklist of suggestions for doing it right for bosses who
would like to manage by walking around+
1. Make MJ?' part of your routine. Mropping in on employees>
workspaces for an informal chat is most effective if you don>t do it on any fi0ed
schedule, since @you>ll reali8e the greatest returns by seeing what is going on
when people aren>t prepared for you,@ Stevens says. Jut do plan for a bit of
MJ?' on your own calendar every day, if you possibly can, even if it>s only
for half an hour+ @The more often you do it, the more beneficial it is.@
114
2. Mon>t bring an entourage. MJ?' works best as a continual stream of
one(on(one conversations with individual employees. Jringing aides or
assistants with you will probably !ust inhibit the discussion by making people
more self(conscious or, worse, make them feel you>re ganging up on them.
*. &isit everybody. 's anyone might guess who>s familiar with how office
rumor mills get spinning, dropping in on some folks more often than others is
likely to create the wrong kind of bu88. Try to spend roughly the same amount
of time R not necessarily all in the same day or even the same week, but
over the long run R with each person who reports to you.
,. 'sk for suggestions, and recogni8e good ideas. @'sk each employee
for his or her thoughts about how to improve products, processes, sales, or
service,@ Stevens says. Then, if someone>s idea leads to a positive result,
make it known whose suggestion it was and show you>re ready to give credit
where it>s due.
.. "ollow up with answers. If you can>t answer an employee>s -uestion off
the top of your head, don>t forget to get back to him or her with an answer
later, Stevens suggests. Jesides being common courtesy, it builds trust.
/. Mon>t critici8e. <emember, you>re on a fact(finding mission, with the
secondary purpose of building rapport. To avoid undermining those aims,
Stevens says, @If you find that an employee isn>t performing his or her !ob
115
correctly, don>t attempt to change the behavior on the spot. Instead, make a
note of it and address the problem at another time and in another setting.@
#learly, MJ?' takes some e0tra time and effort, but apart from any tangible
payoff it might yield down the road, you might even find that you en!oy it.
Stranger things have happened.
ow to Implement MJ?'+
These @wandering around@ tips can help you get started+
<ela0 O 2eople will sense your genuineness and casualness, and
they>ll respond accordingly. Stiff, formal conversation will probably lead
to e-ually rigid responses.
Gisten and observe more than you talk O Dse active listening with your
staff. ?hen people feel you>re hearing them, you>ll probably seem more
sincere. <ead some pointers on active listening .
'sk for feedback and ideas O Get everyone know that you want ideas to
make things better. 's the boss, people may think that your opinions
and ideas are @right.@ So hold back from saying what you think O the
goal is to see what others have to say.
?ander around e-ually O Mon>t spend more time in one department or
section than another. 'nd don>t always talk to the same people, or to
people with certain ranks. Bou want to be approachable to everyone,
regardless of !ob title or position.
126
Dse the time for spontaneous recognition O If you see something good,
compliment the person. This is a perfect way to show your gratitude.
old meetings @out and about@ O Instead of having all your meetings in
the boardroom or your office, meet with people in their work areas and
@on their turf.@ This can put them more at ease. #ommunicate your
e0pectations and needs so that everyone knows what you value.
Mon>t use this time to !udge or criti-ue O This can make people nervous
when you>re around. If you see something that concerns you, talk to the
person later, in private.
'nswer -uestions openly and honestly O If you don>t know an answer,
find out and then follow up. If you can>t share something, say so.
Telling half(truths can break down trust.
#ommunicate O Share company goals, philosophy, values, and vision.
Bour @walk(arounds@ are opportunities to mutually share information
that helps everyone understand and do their !obs better.
#hat O )ffective organi8ations aren>t all about work, work, work. Juild
relationships. Gearn the names of your staff>s kids. "ind out what they
love to do or where they>re going on vacation. hoke, laugh, and have
fun. Bou may be surprised at how great it feels to relate on a personal
level with the people in your office.
Mon>t overdo it O Mon>t leave people feeling that you>re always looking
over their shouldersi ?ander around often enough to get a good feel
121
for what>s going on, but not so often that your presence feels like a
mundane distraction.
=22=<TDAITI)S
To implement MJ?' throughout your company, consider making it one
element of your managers> performance evaluations. ?hat gets measured
gets donei If supervisors work far away from the staff they manage, consider
moving them, or giving them a second office that>s closer to where the work is
done. If managers work near their staff, they may be more approachable.
MJ?' can be an effective and practical way to keep up with what>s
happening within your team and your organi8ation. Juilding up
relationships with your staff pay off significantly with the information you>ll
gather and the trust you>ll build. ' team spirit can naturally develop when
you show a genuine interest in your people and their work. It>s also a great
way to keep the company>s vision alive at all levels. It>s easy, economical,
and a whole lot of funi
If anyone needs proof that #)=s and other business leaders can really
change their own perspective, as well as transform the business by
relatively simple best practices such as MJ?', !ust look at 'pple7s
performance over the past decade.
Steve hobs never got an MJ' $he would have ma!ored in something else
anyway%, but he attained his MJ?' with honors.
122
Jill =lsten, who built the =lsten #ompany from a small temp service in the
15.6s to a billion(dollar staffing resources firm $ac-uired by 'decco Kroup in
1555%, wasn7t your typical "ortune .66 #)=. "or one, he knew every
employee by name. e made it a point to check in and say hello to staff
members on a regular basis, and always let each individual know how
important they were to the company.
The world needs more Jill =lstens and Steve hobs.
In a world overrun by the MJ' ethic, and people and systems stressed
beyond their breaking points, perhaps we need to see more MJ?' being
practiced.
MJ?', or management by walking around, is a smart approach to
management, because it helps managers keep their ears to the ground on
developments around the company, as well as new ideas. 't a time of intense
competition and rapid change, leaders need to maintain close connections
with the people that will make change happen.
12*
&NIT '
I41$r0!6ce $3 07e 1r!c0ic!# e#e4e602 $3 c$41e0e60#" !d4i6i20eri6< !
27i1 4!6!<e4e60 c$41!6" $6 ! 2$#id 3$:6d!0i$6 $3 2cie60i3ic 4e07$d2
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Dnit III )mphasi8e the importance of the practical elements of
competently administering a ship management company on a solid foundation
of scientific methods wherein it enables to implement independently, safely,
economically and successfully in all domains of ship management in terms of
utili8ation of the different types of ship management styles.
The group reports about the appropriate philosophical approaches of
conducting the administration of shipping management putting high emphasis
12,
on the epistemological, metaphysical, logical and a0iological aspects of the
study.
A&TOCRATIC MANAGEMENT STY)E
A:0$cr!0ic M!6!<e4e60, also known as !:07$ri0!ri!6 4!6!<e4e60,
is a management style characteri8ed by individual control over all decisions
and little input from group members.
'ccording to Maft and 2irola(Merlo $2665% describe an autocratic manager or
boss(centred as one who tends to centralise authority and derives power from
position, control of rewards and coercion. 'utocratic managers typically make
choices based on their own ideas and !udgments and rarely accept advice
from followers. 'utocratic management involves absolute, authoritarian
control over a group.
In simple words, 'utocratic Management could be characteri8ed as
4High emphasis on performance an& a lo* emphasis on people5.
T"1e2 $3 A:0$cr!0ic M!6!<e4e60
1. Direc0i5e A:0$cr!0 is a manager who makes decision e0clusively
without the consent of his employees. This type of autocratic manager
is described as a c$60r$# 3re!.
2. Per4i22i5e A:0$cr!0 is a manager who makes decision e0clusively
without the consent of his employees @:0 leaves some space for some
12.
discretion to their employees as to the means through which a task can
be achieved. This type of autocratic manager is described as a
de4$0$cr!0 67u3tapose of &emocrat an& autocrat8.
AD,ANTAGE DISAD,ANTAGE
Se62e $3 Re21$62i@i#i0". =ne of
the positive things about an
autocratic management style is that
determining responsibility for bad
results should be easy.
Irre21$62i@i#i0" !6d %#!4e G!4e.
The negative side of the
responsibility coin concerning an
autocratic manager is that while she
gets to determine who made the
mistake, the fact that being an
autocrat means blaming a
scapegoat even if it is her own fault.
E4er<e6c" M!6!<e4e60. =ne
situation where an autocratic
manager is definitely wanted is in
an emergency situation. This can
be a business situation in which you
have a short deadline on an
une0pected pro!ect.
)!c $3 I61:0 !6d E41#$"ee
O/6er27i1. 'n obvious drawback
to autocratic management is that no
one knows everything. This means
that although the manager may
have a great deal of e0perience, his
employees may have knowledge
that could make a significant
difference if he were to ask for their
input.
)$<ic!#EP7i#$2$17ic!# A21ec0
12/
'ssumes that people are la8y, irresponsible, and untrustworthy and
that planning, organi8ing, controlling, and decision making should be
accomplished by the leader with minimal employee involvement.
<elies on authority, control, power, manipulation and hard work to get
the !ob done.
<un a tight ship by planning, organi8ing, directing, and controlling the
efforts of others.
Me0!17"2ic!# A21ec0
'lthough the emphasis is on high productivity, it often @reed2
c$:60er3$rce2 $3 !60!<$6i24 and low -uality of output.
'utocratic management 0e6d2 0$ @e 4$re 1:6i0i5e and the inherent
close supervision increases role ambiguity, reduces productivity, and
decreases group harmony.
E1i20e4$#$<ic!# A21ec0
Aer$ Feed@!c Mec7!6i24. =ne way communication without
feedback leads to misunderstanding, and communications breakdown.
S$#:0i$62 T$d!"D Pr$@#e42 T$4$rr$/. alf(baked decisions could
be made which can be very dangerous in this age of technological and
sociological comple0ity.
I##(4$0i5!0ed 2:@$rdi6!0e2 e2c!1e 07e re21$62i@i#i0" !6d i6i0i!0i5e.
It fails to develop the worker>s commitment to the ob!ectives of the
organisation.
121
)$/ 4$r!#e $3 /$r(3$rce. It creates problems both with employee
morale and production in the long(run9 due to their resentment
Cre!0i5i0" $3 2:@$rdi6!0e2 re4!i62 :60!11ed. It is unsuitable when
the workforce is knowledgeable about their !obs and the !ob calls for
team work and cooperative spirit. It tends to develop dependent and
uncreative employees who are afraid to seek responsibility.
AFi$#$<ic!# A21ec0
Kood for Ine0perienced and Dnmotivated ?orkers, Jad for ighly
Skilled and Motivated ?orkers
The autocratic style is most effective when the leader is present. Dnlike
the transformational style of leadership where followers become self(
motivated to complete tasks, once the autocratic manager is gone,
there is no guarantee that team members will keep working.
F!4$:2 A:0$cr!0ic )e!der2 !6d C$41!6ie2
1. 'dolf itler O e re-uired the population of the Third <eich to accept
everything that he said as absolute law, and was able to impose a
death sentence on anyone who failed to do so. itler was obsessed
with being in control, and with being the alpha male in a rigid male
dominance hierarchy.
124
2. hohn ". Nennedy O had a vision to change the space program forever (
by sending a man to the moon and to return safely. This type of vision
and idea came to light through his constant motivation of the D.S. to
see his vision.
*. Jank of 'merica
,. Jank of )ngland
.. <esearch In Motion $Jlackberry%
)!i22e>(3!ire M!6!<e4e60 S0"#e
The concept of this type of management was born in "rance where business
owner asked the government to :let it be; governed by themselves on the
operation and price of their products however the effect is not fair for the
labour party and consumer party. This type of management evolves and it is
used today but in a different perspective in management where a subordinate
in a company is given responsibility to decide or act on itself without any
supervision from the management.
P7i#$2$1ic!# A21ec0
Subordinate can function more effeciently with a very little guidance
from the managers
Subordinates can grow better by providing them freedom make
decisions
125
Subordinates are able to solve problems at their own by providing them
the tools that they need
Me0!17"2ic!# A21ec0
It will not limit man7s way of thinking
#an be effective when group members are highly skilled, motivated
and capable of working on their own and the managers are open for
consultation and provide them feedback
Aot ideal in situation where group members lack knowledge or
e0perience. Some people are not good at setting their own deadlines,
managing their own pro!ects and solving problems on their own. In
such situation the pro!ect can go off(track and deadlines can be
missed. It can also create havoc
)$<ic!# A21ec0
Jy having someone that can do the work load with less supervision will
create a oppurutnity for the management to enhance the system or
create a future plan for the company
=ppurtunity for the subordinate to share the ideas that can be used by
the management
?ork will be more efficient with less bureaucracy.
1*6
E1i20e4$#$<ic!# A21ec0
Jill Kates own a company where he is capable of doing almost any
tasks re-uires in his company. owever Mr. Kates does not attempt to
do all the !obs. The reason is that Mr. Kates can concentrate on the !ob
in which his productive superiority is greatest making his company
more profitable.
1466 the :industrial revolution; where the western europe and DS
government adopts :Gaisse8(faire; in governing companies
#ompanies are both effectively and efficiently providing their services
specially in rail road construction
owever there is a catch. )mployess in the fieldCfactory work in a poor
condition and being e0ploited by the companies since the government
is hands off in the company operation
AFi$#$<ic!# A21ec0
2roviding freedom in decision making can empower a subordinate.
owever the superior must provide the subordinate the proper trainings
and e0periences.
aving the option to designate task can be a big help in building a
company
1*1
CONS&)TATI,E MANAGEMENT STY)E
Style in this case the manager will actively seek out the opinions of
employees before a decision is made. ?hile both an autocratic manager and
a persuasive manager will place the needs of the business before the
employees, a consultative manager is far more likely to recogni8e that
employees are able to make a valuable contribution to the running of the
company.
There are many situations in which a consultative management style might be
appropriate. In fact, most large scale organi8ations will use managers who
adopt this style at some level in their business.
#onsultative managers consider the opinions of stakeholders, but
decisions are still made centrally. This means that there is an identifiable
person who is responsible for the decisions that are made, but that others are
given an opportunity to have some input into the decision making process.
The consultative management style can be viewed as a combination of
democratic and autocratic. The consultative manager will ask views and
opinions from their staff, allowing them to feel involved but will ultimately make
the final decision.
The consultative style is used on a regular basis by many large scale
organi8ations. This is because it maintains some of the advantages of the
more dominant management styles $such as the autocratic style without the
1*2
loss of direction that can accompany the laisse8 faire style. #onsultative
managers will often be seen asking various stakeholders what they would do
in certain situations, or how they would respond to events that have occurred.
?hile the final decision still rests with the manager, the action of seeking input
is part of the day to day reality of the business.
The style focuses on using the skills, e0periences and ideas of others.
owever, the leader or manager using this style still retains the final decision
making power. To his or her credit, they will not make ma!or decisions without
first getting the input from those that will be affected.
EPISTEMO)OGICA) ASPECT
The epistemological aspect of #onsultative Management Style is how it
is figure out, what is right and wrong, or good and bad rather than the set of
facts that actually makes !udgments true O : hDSTI"I)M T<D) J)GI)"S :
AD,ANTAGES
Kreat variety of ideas
)mployees have some ownership over the way the organi8ation is run.
's a result they may take more interest
=ften task are completed more efficiently
1**
DISAD,ANTAGES
Time consuming
Staff who does not consulted on every decision can become uncertain
of their role
Some ideas are bound to be overlooked in the final decision which can
cause resentment of conflict
CONC)&SION
Jest used in times of change or when a decision will directly affect the
employee
METAPHYSICA) ASPECT
Metaphysics is the branch of 2hilosophy that addresses -uestions of
reality. In 2hilosophy, reality is the state of things as they actually e0ist, rather
than as they may appear or might be imagined
CONS&)TATI,E MANAGEMENT METAPHYSICA) ASPECT
)0istence of #onsultative Management
1*,
's a result of employee involvement, decision will take time to
formulate
'ccountability within the group as each employee will bring their best
ideas to the Management for consideration
#=A#GDSI=A
The #onsultative Management in terms of Metaphysical 'spect creates
opportunities to the talented employees to seek their own ways to strengthen
their professionalism owing to the consultative direction.
)OGICA) ASPECT
Is a branch of 2hilosophy that deals with reasoning. There are two $2%
basic types of reasoning, deductive reasoning and inductive reasoning. In
deductive reasoning, thing proceeds from the most general concepts to the
most specific e0amples. In inductive reasoning, thinking proceeds from the
most specific e0amples to the most general concepts9 generali8ation are
derived from specific e0amples.
1*.
CONS&)TATI,E MANAGEMENT )OGICA) ASPECT
Inductive reasoning in the process of applicable in this type of
management style where things proceeds from the most general concepts
and generali8ation are derived from specific e0amples.
)0ample+
1. Management seek views and opinion from the staff on a certain pro!ect
2. Staff provides inputs and suggestions that they think a big help to the
Management per their e0perience
*. Management will come up with the decision based on the collective
inputs or own decision
A-IO)OGICA) ASPECT
Jranch of 2hilosophy that deals with values. It is the philosophical
study of goodness or value in the widest sense of these terms O : T)=<B
=" &'GD)S :
#=ASDGT'TI&) M'A'K)M)AT O 'EI=G=KI#'G 'S2)#T
&alues are those inner -ualities that everyone has and these drive
human motivation
1*/
Miscovering $not assume or guess% what your people hold most clear
and genuinely honor those as best you can and other limits
)thics O <esponsiveness
Neeping the communication open with your staff
Sometimes, you cannot always share everything you know as a
manager(leader, but you can always find ways to share some
information, even if only the big picture
Bou can let people know their input was valuable but !ust not
applicable at the present time
'esthetics O Managing the group by walking around
Jeing visible on a regular basis
Melegating the right things to the right team members, the richer their
!obs can become O win(win situation
Per4i22i5e M!6!<e4e60
The philosophical foundation of this kind of leadership shall be laid out
in this chapter using the )pistemological, Metaphysical, '0iological and
Gogical aspects.
Jriefly, each aspect shall be define and applied to the principles
surrounding the 2ermissive Management approach in reference to its general
1*1
description and study of its Strengths, ?eaknesses, Threats and
=pportunities.
F$:r M!G$r A21ec02 $3 P7i#$2$17"
Epistemology
)pistemology is one of the core areas of philosophy. It is concerned
with the nature, sources and limits of knowledge. )pistemology has been
primarily concerned with propositional knowledge, that is, knowledge that
such(and(such is true, rather than other forms of knowledge.
2.1
Metaphysics
Metaphysics is a broad area of philosophy marked out by two types of
in-uiry. The first aims to be the most general investigation possible into the
nature of reality+ are there principles applying to everything that is real, to all
that isg O if we abstract from the particular nature of e0isting things that which
distinguishes them from each other, what can we know about them merely in
virtue of the fact that they e0istg The second type of in-uiry seeks to uncover
what is ultimately real, fre-uently offering answers in sharp contrast to our
everyday e0perience of the world. Dnderstood in terms of these two
-uestions, metaphysics is very closely related to ontology, which is usually
255
http://www.rep.rout'edge.com/artic'e/*654
1*4
taken to involve both Iwhat is e0istence $being%g7 and Iwhat $fundamentally
distinct% types of thing e0istg7
The two -uestions are not the same, since someone -uite unworried
by the possibility that the world might really be otherwise than it appears $and
therefore regarding the second investigation as a completely trivial one% might
still be engaged by the -uestion of whether there were any general truths
applicable to all e0isting things. Jut although different, the -uestions are
related+ one might well e0pect a philosopher7s answer to the first to provide at
least the underpinnings of their answer to the second. 'ristotle proposed the
first of these investigations. e called it Ifirst philosophy7, sometimes also Ithe
science of being7 $more(or(less what Iontology7 means%9 but at some point in
anti-uity his writings on the topic came to be known as the Imetaphysics7 O
from the Kreek for Iafter natural things7, that is, what comes after the study of
nature. This is as much as we know of the origin of the word $see 'ristotle
o11 and following%. It would, however, be -uite wrong to think of metaphysics
as a uni-uely I?estern7 phenomenon.
2.4
Axiology
'0iology is the branch of practical philosophy which seeks to provide a
theoretical account of the nature of values, whether moral, prudential or
aesthetic.
2.5
257
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254
http://www.i,a.d./8ni/'i!eboato'd/0oncepts/A$io'og#.htm
1*5
Logic
It has two meanings+ first, it describes the use of valid reasoning in
some activity9 second, it names the normative study of reasoning or a branch
thereof. In the latter sense, it features most prominently in the sub!ects of
philosophy, mathematics, and computer science.
2/6
P7i#$2$17ic!# A21ec02 !2 !11#ied 0$ Per4i22i5e M!6!<e4e60
General Concept of Permissive Management
'llows employees to take part in business decisions
)ncourages certain degree of autonomy among employees in e0ecuting
their task.
Gess supervision and monitoring from the part of managers.
Epistemological Aspect
It is believed that in this type of management, employees are empowered
to make their own decisions at work.
Jy having this kind of autonomy among subordinates, new leaders are
e0pected to emerge.
2%6
http://en.wi.ipedia.org/wi.i/-ogic
1,6
It allows free flow of creativity and innovation among subordinates due to
the freedom bestowed among employees.
It is believed that this type of management style also boosts the morale of
the employees.
It is more democratic in nature
Axiological Aspect
)mphasi8e the essence of freedom
"oster trust on the part of the leader and confidence on the part of the
subordinates
It encourages creativity and innovations
It promotes :going the e0tra(mile; attitude among employees
Mevelops succession planning and future leaders
2romotes )mployee )mpowerment
Metaphysical Aspect
The 2ermissive Management Style allows employees to take part in
business decisions and they are given a considerable degree of
autonomy.
1,1
In order to prevent the abuse of decision(making authority given to
employees, parameters or guidelines must be established by the
organi8ation.
Specify the corporate matters that may be decided by the employees in
order to manage egoistical issues.
2rovide trainings to employees in order for them to value the
confidence bestowed upon them
)stablish control measures such as #ode of )thics, 'nnual Judget,
Luality #ontrol and #ustomer "eedback
Logical Aspect
?ith the concept of permitting employees to take part in the deciding on
the course of the business process, it is presumed that in an organi8ation
with set of rules and guideline, 2ermissive Geadership allows each
member to independently e0ecute their task in a manner that their desire,
provided that said manner must be able to arrive to a uniform goal or
output as other member does.
1,2
C$6c#:2i$6*
2ermissive Geadership can be compared to alcohol drinking, its
implementation must be moderation and bears utmost responsibility. This
concept of leadership addresses a lot philosophical concerns in terms of
human behavior in terms of uplifting the desire at work, knowledge and
emotions.
It is inherent for each individual to desire some amount of
independence to every task that they do, whether it be personal or
professional aspect, but since business organi8ation has comple0 process
that involves a numerous considerations such as human resource, financial
gains, corporate responsibility and general administration of the business
operation, limitations are set in order to attain a uniform ob!ective.
's discussed, permissive leadership empowers and encourage
employees to be conscious and confident in doing their tasks, setting rules
and guidelines is necessary in order to combat the threats surrounding this
type of management but it does not aim to limit the potential of employees.
ence, permissive leadership is applicable to Ship Management
business at a certain degree, such as the day to day office task but in terms of
technical aspects that involves crucial effects, other management styles may
apply.
1,*
1,,