“Adaptation” in Business Management is a bad Practice

Management information represents an important tool for sound corporate performance and it is, however, a cost to an organisation when top decision-making executives disregard specific knowledge within the lower ranks. For instance, investment in technology without probing its reliability is tragic to an organisation.

Decisions power, therefore, should be allocated to those individuals, in the organisation conversant with the knowledge of the day (Hayek, 1945), sometimes found in the lower management.

Unfortunately, however, most public policy institutions and business organisations resort to ‘adaptation’ as a better way of sharing specific and relevant knowledge among the top management, who lacks the specific and relevant knowledge of the day.

Indeed, adaptation is the sharing of all relevant and specific knowledge by the lower management staff with some senior officers (top management), who will then brief higher authorities and/or implement them through issuing of orders.

Of course, this centralised economic planning methodology has gained traction and acceptability in most corporate governance in modern history (Jensen & Meckling, 1992) but missed the benefits of the specific knowledge explosion.

Seriously, management is a thoughtful enterprise, which should not be left in the hands of the experienced but also those with the professional knowledge and know-how through “serious” education as well as further real and proper in-service training as against the business as usual mere certification courses.

In simple words, experience alone is not enough to qualify as chief executive officer, manager and/or director, it should be backed by relevant academic and professional certification.

The performance problem of most public institutions for decades, in part, is the fielding of generalists, who have little or no affinity for professionalism, in management positions.

Research and development provide a veritable means by which management overhauls, modernises and/or retools human capital. Corporate manpower obtains information advantage for sophistication in production through research and this information can be training in know-how which is not available to other business rivals leading to the creation of important opportunities including superior product design and risk reduction.

Regrettably, this information technology transformation surge of knowledge seems to elude some senior managers and directors, who are incapacitated in their abilities to access, acquire and grasp specific knowledge necessary for organisational growth and expansion.

They also lack the skills to innovate and act in that direction and are also far remote from the actual phenomena, thereby making use of secondhand (recycled) and previously worked on data (Jones, 2007).

The implication for this is that these managers and directors forfeit the advantages of analytical talents and most often end up dwelling on automatic decision rules that reduce data manipulation needs (Easterby-Smith, Thorpe, et al. 2012).

More often, top management loses touch with the goings-on and/or specific relevant knowledge as the enterprise grows larger and requiring different layers of governance.

It is logical that decision-making is decentralised to the lower management, who possesses the relevant information. Interestingly, governance structure absence – the power of influence localised in a few directors, in both public and business organisations, occasions principles collapse in corporate governance and de-emphasises the utilisation of specific and relevant knowledge at the lower level of management.

The argument that divergence exists between knowledge-based power and position-based power is sustained, more especially when decision rights are concentrated in the hands of top management and directors, who are not abreast of time and realities of the day leading to serious ramifications for technology improvement (Andrew, 1983).

Inasmuch as there is a need for position power in an organisation, consideration should be made to utilise the expertise of junior officers, who constitute the critical mass and have important information.

One of such avenues to make use of the expertise at the lower management is to allow them to participate in joint decision-making with senior management. In fact, decentralisation fails in this country not because the implementors lack understanding of the concept plus other administrative problematic nuances, rather it is the unbridled clinging on to position power, and I am not digressing here, though.

The bankable and useful way of utilising specific and relevant knowledge at the lower management level is to accord to them significant decision-making authority rather than the adaptation of relevant and specific knowledge.

As decentralisation challenges public and private management, managers and directors should purge themselves of the inherent problematic human realities (seeking personal welfare and protecting position power) for the robustness of systemic rules to function, while allowing knowledge-based power adequate room to operate for organisational growth, innovation and expansion, safeguarding and rewarding decisions plus evaluation rights of individuals wielding decision rights via organisation’s reward systems.

The writer is Director, Monitoring and Evaluation

Ministry of Tourism, Arts and Culture

Email: getdrkumaza@gmail.com

 By Dr. ALPHONSE KUMAZA

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