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Monday, July 11, 2005
Antonio: Distinguishing corporate roles
By KIKO ANTONIO
NIGHT MANAGER
THE rapid economic development of Asia in recent decades is one of the most important events in history. This development continues today and there is every reason to anticipate that it will continue indefinitely unless derailed by possible but unlikely international conflicts. At the core of Asian economic development is its business leadership-managers and entrepreneurs who sustain and create Asian companies.
Roles in organizations involve more than just leadership. It is useful, but not yet common in our literature and discussion of business, to distinguish among leadership, management, and administration. They are in fact very different; each is valuable and has its place. Briefly, leadership is about a vision of the future and the ability to energize others to pursue it. Management is about getting results and doing so efficiently so that a financial profit or surplus is created. Administration is about rules and procedures and whether or not they are being followed. These distinctions are very important for clear communications among us about how organizations are run — when they are not made, we become very confused.
D. Quinn Mills, Professor of Business Administration at Harvard Business School, says that our focus today should be on leadership: how an executive sets direction and energizes his organization to pursue the direction. This is appropriate because managerial techniques are being spread fast by imitation, adoption, and MBA education. Administrative techniques were generalized around the world decades ago.
Cultural differences are important, but primarily as a matter of emphasis. For example, family leadership of business enterprises, including large companies, occurs in very similar ways in other regions, but is more common in Asia.
For instance, there is less freedom of action for executives and boards in America than in Asia. But more common in America are firms that are run by professional managers who are replaced by other professional managers, either as a consequence of retirement or of replacement by the board of directors of the firm. The better companies have sophisticated programs for developing executives within the firm, and ordinarily choose a next chief executive officer from among them. American CEOs average about thirty years with their firms and own less than four percent of its shares. There is a small number of firms, which get a great deal of publicity and so seem more numerous than they are, that hire CEOs directly from the outside, with no previous experience with the firm.
(kiko_antonio@ yahoo.com) |
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