Seven Ways to a Better Management

There are basically seven ways how to make a better management. These are the new tools of management which are emerging rapidly nowadays. Their major contribution is to bring out and sharpen the rational system, rational hypothesis that underlies the business enterprise even managerial decisions and actions. The new tools raise and find answer to many managerial questions, such as What will actually needed to attain objectives? Who will benefit from it and the like. It is possible means to apply new tools to plan future decisions more intelligently, with greater chance of being in the right decision.

Here are seven ways in which these new tool could make a better management:

1. They enable a manager in a business to see and understand the whole business infairly simple terms. Our economic life and our technology have become so general and complex as to make it very hard for a man to see the whole of even a simple and small business. Accounting is obviously the oldest and most successful tool for this purpose; indeed, the general accounting system with which we are all familiar is a very good example of a special-purpose tool in this management tool kit. It is, however, as I think most of us know, a special-purpose tool which will do only a few things, though it does those superbly. In essentials, all tools, whether operations research, statistical decision-making, or any other- operate on very similar basic methods, they try to find a simple and universal way of looking at the business as a whole which enables a manager to understand this very complex and very diverse thing that is the modern business enterprise.
2. The second basic contribution of the new management tools is that they make it possible to take decisions with respect to one area of the business without “sub-optimizing.” We all know that the actual action and decision in business are very rarely taken for the whole business. Of necessity, in departments, in divisions or what you have. Most problems with which people in management deal are problems within one area of the business, problems of manufacturing or of selling, of labor relations or purchasing. Now all of us know, indeed, we know it so well that it really should not have to be said that the only reason why we have these functions is that they contribute to the business. They are not the ends in themselves. And we all recognize that properly speaking, there are very few actions or decisions in any one of these areas which do not have the real impact on other areas.
3. The next contribution of the tools, the next thing the manager should expect and demand of them, it is that they present to the manager all the alternatives of action possible in a situation. Full knowledge of these alternatives, and of their risk and implications, is probably the most important factor in sound decision-making. All of us, inevitably, tend to see one course of action as “obvious.” To see the full range of alternatives, obviously, is essential.
4. The manager should expect and demand of these new tools that they show him what risks there are in each course action, what assumptions underlie it, and what efforts and resources will be needed to carry it out successfully. The manager, in other words, demand of the new tools that they show him exactly what is he being asked. Within limitations, that is, within a strictly financial frame, this is, of course, what we expect our accounting system to do for us.
5. These new tools can determine what measurements are appropriate to a certain decision and to a certain area of the business. Let’s have an example, anybody who has – whether as a personnel or manufacturing man knows, for instance, that a very small number of people, very rarely more than 10% of the plant, account for 90% of absenteeism. He knows that a very small number of people account for majority of accidents and sickness. He also knows that very small number of jobs usually account 90% of turnover in the plant, or that practically all turnover occurs during the first six months of man’s employment.
6. The new tools can help the manager to find out who should know about decions and about things that go on; who should have information, when he should have it, and in what form. They can greatly help, therefore, with the communication problem of a business, especially the communication with management which, as we all have learned, is the really important and decisive aspect of this problem. Let me again say the closer we come toward automation, the more important this will be. For automation depends above all on really good and effective internal communication within management.
7. Finally, these new tools can tell the manager what to look out for in the future. They can show him what things he has does not know when he makes a decision, what facts he just guesses at, and what things he had therefore better look out. They can also show him what he expects to happen in such a way that he notices right away when it does not happen, early enough, perhaps, to change a decision before it has come the wrong decision.

Let me repeat that I have not say managing is entirely a logical, systematic, scientific process, but it is very much like medicine or law, in both of which you need experience, you need intuition, you need “feel.”