CAUSES AND CONSEQUENCES OF MANAGERIAL FAILURE IN

RAPIDLY CHANGING ORGANIZATIONS

By – Kevin JosephMBA (Energy Trading)

Managerial Life in 21st Century

Rapid market restructuring Rapid change Frequent Internal reorganizations Flattening of the world has made it

easier for the companies around the globe to compete against each other.

Change exposes weakness in managers

But can also create leadership opportunities for a few

A research study was conducted among 2000 managers in 2001 and 5000 managers in 1999.

Single most important factor to keep one’s job was getting results/excellent performance.

Majority of managers do not have expertise to cope up with rapid change involving complex condition.

They are well versed in old ways of thinking and solving problems.

They are successful in more stable environment .

Fail due to inability to adapt to rapid changing environment.

Hence it becomes very important to study and understand the reasons why managers fail.

So as to help reinforce the managers and indirectly the organization to cope up with this rapid change.

Finkelstein’s Research

Five major causes of Failure of a CEO

Choosing to ignore change Pursuing wrong vision Being too closely connected to

company Exhibiting executing arrogance Relying on past formulas for success

Reason for all this rapid changesMain driving force - The need to protect or improve the organization’s current competitive position in the market.

This includes –

Infusing new technologies Process redesign Mergers Consolidations Acquisitions Reengineering activities Organizational restructuring Reconfiguring supply chains Major work redeployment Development activities

After Extensive Research

Top 15 Primary causes for managerial failure -

Ineff

ectiv

e Com

mun

icat

ion

skill

Poor

inte

rper

sona

l skills

pers

on jo

b m

ismat

ch

Fail in p

erfo

rman

ce e

xpec

tatio

n

Failing

to b

reak

old h

abits

0

10

20

30

40

50

60

70

80

90

Lack

of D

eleg

ation

Lack

of p

erso

nal int

egrit

y an

d tru

stwor

thines

s

Unable

to d

evelop

coo

pera

tion/

team

work

Unable

to le

ad/m

otivat

e ot

hers

Poor

plann

ing

prac

tices

0102030405060

Failu

re to

mon

itor a

ctua

l per

form

ance

and

pro

vide

feed

back

Failin

g to

rem

ove

perfo

rman

ce b

arrie

rs/ro

adbl

ocks

Ego,

Atti

tude

and

Indi

fferen

ce p

robl

ems

Failin

g to

sel

ect,

prom

ote

and

deve

lop

tala

nted

peo

ple

Lack

or m

isuse

of c

ritica

l res

ourc

es0

10

20

30

40

Competencies necessary to survive

First set (Social in nature):

Effective communication Relationship building Clarifying expectation Providing effective feedback Empowerment Team leadership Motivating others

Second set (Personality based):

Positive Attitude Integrity Character Commitment Risk taking Looking for new and better ways to do

things Openness to change and adaptation

Thee characteristics take quite a while to develop.

Therefore study them as early as possible and start implementing as early as you can.

THANK YOU