Concepts of Throughput Accounting and Theory of Constraints

Financial Management

Kaizen – Understanding the Japanese Business Philosophy of Continuous Improvement

Operations Management

Role of Leaders in Shaping Organizational Culture

Management Principles

Organizational Culture – Development and Importance

Management Principles

Five Important Organizational Cultural Models

Management Principles

Types of Business Ownership – Sole Proprietorship and Partnership

When entrepreneurs establish a business, they must decide on the form of business ownership. There are three basic forms of business ownership: sole proprietorship, partnership, and corporation. The form that is chosen can affect the profitability, risk, and value of the firm. The business ownership decision determines how the earnings of a business are distributed among the owners of the business, the degree of liability of each owner, the degree of control that each owner has in running the business, the potential return of the business, and the risk of the business. These types of decisions are necessary for all business. Sole Proprietorship A business owned by a single owner is referred to as a sole proprietorship. The owner of a sole proprietorship is called a sole proprietor. A sole proprietor may obtain loans from creditors to help finance the firm’s operations, but these loans do not represent ownership. The Continue reading

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Objectives of Demand Forecasting

Demand forecasting means an estimation of the level of demand that might be realized in future under given circumstances. These are concerned with the predictions of demand for products or services to minimize the uncertainties of the unknown future. These forecasts on demand facilitate in formulating material and capacity plans and serves as inputs to financial, marketing and personnel planning. The demand forecast itself may be generated in a number of ways, many of which depend heavily upon sales and marketing information. The objectives of demand forecasting are different in case of short run and long run forecasts. Short Run Forecasting Short run forecasting is usually a period not exceeding one year. The following are the objectives of short run demand forecasting. To evolve a suitable production policy: Short term forecasts help the firm to plan the production so as to avoid the problems of over production and short supply. Continue reading

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The Principles of Modern Management by Frederick Taylor

Frederick Taylor, known as the Father of Scientific Management, conducted many studies at Bethlehem Steel Company in Pittsburgh. His experience as an apprentice, a common labor, a foreman, a master mechanic, and then a chief engineer of a steel company gave Taylor an excellent opportunity to know first hand the problems and attitudes of workers and to see the great possibilities for improving the quality of management. To improve productivity, Taylor examined the time and motion details of a job, developed a better method for performing that job, and trained the workers. Taylor also offered a piece rate that increased as workers produced more. In 1911, published a book “Principles of Scientific Management” in which he proposed work methods designed to increase worker productivity. He defined management as art of knowing exactly what do you want to do and seeing that they do it and in the best and cheapest Continue reading

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Open Innovation – A New Innovation Paradigm

An innovation is a product or service with a bundle of features that is new in the market, or that is commercialized in some new way that opens up new uses and consumer groups for it. Innovation is invention implemented and taken to market. Invention however is the creation of something that was previously unknown. In summary, INNOVATION= INVENTION+COMMERCIALIZATION. Today companies who, want to deliver consistent organic growth to their shareholders, customers, and their employees can do that only through innovation. Concept of Open Innovation According to American organizational theorist Henry Chesbrough, Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. Open innovation assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as they look to advance their technology. As mentioned Continue reading

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The Future of Bitcoin

Bitcoin is a type of digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer. P2P network-based virtual currency that is traded online and exchanged into currencies. When paired with third-party services, allows users to mine, buy, sell, or accept bitcoins from anywhere in the world. The offer of transactions with relative anonymity is a significant financial power and brings changes to the future payment systems. Transactions are made with no banks interfering, so there are no transaction fees. More merchants are beginning to accept them. Every-one can buy services, goods but also criminals have a way to transfer very their in-come from illicit activities completely anonymously. While Bitcoin developers maintain Web sites providing guidance to the Bitcoin community, they do not have a centralized database or authority. The Future of Bitcoin Bitcoin will never be successful as a currency, Continue reading

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Leader-Member Exchange Theory (LMX)

Several leadership theories including trait, behavioral, and contingency theories assume that the leader-member relations are consistent, with the leaders interacting with all subordinates homogeneously. But, Leader-Member Exchange Theory (LMX) asserts that leader-member relations are heterogeneous as leaders cannot distribute their limited resources and time to all the subordinates equally. Hence the leader develops unique dyadic relations with each member over a series of exchanges i.e. Vertical Dyadic Linkage Approach (VDL). Leader-Member Exchange Theory (LMX), also called the Vertical Dyad Linkage Theory developed by Graen and his colleagues suggests that leaders cultivate qualitatively different types of relations with different employees. The theory dictates that effective leadership processes takes place when leaders and followers develop mature partnerships and thus gain access to the mutual benefits of this relationship. Leader-Member Exchange Theory (LMX) suggests that the leader develops different types of exchange relationships with the subordinates. This phenomenon is called ‘LMX differentiation’. LMX Continue reading

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