Upon incorporation of business entities, the founders hire a CEO with experience and competencies enabling him/her to implement the founders’ vision and the business entity’s mission.
A question arises here, “Will the CEO relies on attracting human resources (jobholders) who contribute plentiful effort or the talented jobholders or rely on establishing an overall management system for managing the business entity?”
The role of management system in business success
Any successful business entity should adopt a set of management systems and manuals:
Set of Strategy Manuals
- Strategic plan
Set of Organizational Manuals
- Organizational structure
- Job structure or job ladder
- Delegation of authority matrix
- Job descriptions
- Employee performance appraisal templates
- Operating policies and procedures manuals for the units of organizational structure
Set of Operating Manuals
- Annual operating plan, which is measured and assessed for feasibility on a monthly basis
Set of Monthly, Interim and Annual Reports
- Monthly, interim and annual reporting system for evaluating the operating plan performance based on cost-benefit principle
The Board of Directors is the key player in creating and establishing the management system while the CEO is the key player in implementing and monitoring the management system, and will be accountable before the Board of Directors for implementing the management system and operating plan.
Employees with plentiful effort and their role in business success
Human resources with disciplined behaviors and high job skills who contribute great effort in producing the business deliverables play a critical role in the success of business entities.
However, the outputs of this category will be only visible when they are directed to clear partial or complete tasks or objectives adding value to a business entity.
The management system will identify such partial or complete tasks or objectives with added value for the entity.
Talents and their role in business success
Talents undoubtfully play a critical role in the success of their businesses. However, if there is no effective management system,
which fosters those talented staff members and provides a working environment that develops their talents,
maximizes utilization of their outputs and considers their ambitions, then they will get frustrated or leave their businesses to other employers providing such requirements.
It can be said that the management system, employees with plentiful effort, and talents constitute the key critical drivers of success in any business entity.
However, the management system will always remain the crucial component that leads business entities to success.
In the absence of a management system, a business entity will not be able to attract talents or employees with plentiful effort, and if it does, it will not benefit from their presence or retain them.