Introduction
This paper seeks to discuss the statement that managers cannot take what they receive at face value and they should test the same by questioning the underlying assumptions, relating them to the context, considering the alternatives and recognizing the limitations. Discussion will use examples with emphasis on ‘critical thinking’.
Analysis and Discussion
Management are expected to produce results in terms of meeting their objectives and to be able to do so they are empowered to decide between or among options in relation to what is most beneficial to the organization in terms of meeting organizational objectives (Massie, 1987 ). As such, they do not exist just to obey orders. Given such decision-making as a critical part of management, taking things at face value would be the least thing to expect. Thus, management theories vary and that no single theory could be applicable solely in a particular case and the decisions of the managers must consider many other factors. Under these management theories are the various motivational theories, which consider different human personalities.
One particular thing that could be used is the very variable pay or incentive plan could be implemented in an organization under one or more motivational theories (Frey, Gouran, and Poole, 1999). There are advantages and disadvantages of each option if a company would have to adopt and implement variable pay and incentive plans for its employees. If managers adopt such a plan, they should be guided by the purpose why such a plan should be adopted. Basically, an incentive plan is designed to improve performance of employees in relation to attaining company goals. The need to increase revenues should not therefore be dependent solely on external factors like the fact that the economy is slowing down when management could find ways to motivate employees as an option of reaching objectives.
In applying for example an incentive plan to generate revenues, sales staff or marketing people could be given enough commissions or bonus based on performance. But an option could have several sub-options. It could pay its marketing staff with 100% commission or salary plus a certain commission basis. As motivating sales or marketing staff is most critical to certain stage in the life and condition of the organization, management must not just accept a news report that the economy is slowing down and that companies may just brace for lower sales. Although generally the external condition could be material in determining the proper strategies, the internal environment of the organization is also very important in crafting the best strategy to reach objectives (Johnson and Scholes, 1993). Motivating people to produce more under uncertain conditions could be the saving factor and the better alternative to silent submission to the external environment.
Decision making from a set of options is endowed with much dynamism on the part of the managers. To continue with the same example of motivating marketing people to produce results by linking their performance to more revenues, the decision could in fact provide the advantage of possible increased revenues from increased clientele and products sold from more marketing efforts. However, the option may have the disadvantages of incurring the cost of the plan and the possibility that the plan would not be successful and would instead make things worse. The success of an incentive plan depends as well on a number of conditions in implementing the same. One condition is for management to find the right amount of incentive pay. If the marketing employees do have an appetite for incentives and pay at risk, managers need to ensure that the size of the incentive could appropriately motivate subjects.
The incentive must have meaning to employees in relation to the desired effect of producing more revenues (Sammer, 2007). If management decides that marketing people should be given commission in addition to their basic pay or simply make them fully paid in commission, management must be ready to face the possible risks and consequences as well. Full commission without basic pay may mean termination from employment of marketing people who are salary-based employment. To motivate the marketing staff under a bonus plan, managers must determine the proper level of commission if the same is added to salary. Management theory requires the right amount of incentive for each situation. A study found that supervisors and product development managers in the US and Europe responded to bonuses of about 30% of their annual salary (Sammer, 2007). A different respond, that is, the optimal bonus was less than 30% of annual salary is found if the product is complex, involves technological, and market uncertainty (Sammer, 2007).
It may be noted in the simple examples of knowing and deciding whether to use an incentive plan, to which employees it will be used and whether employees should be 100% commission or basic salary plus commission, that managers had, in effect, generated options and had in effect applied ccritical thinking. Critical thinking can assume the application of the scientific method (Schafersman, 1991) and is made applicable in management although its application is less formal compared than what normal academic requirements would seem to convey. In the well-known method of scientific investigation, a question is identified and hypothesis formulated (Schafersman, 1991). To use the same case of deciding what incentive plan could be used by managers, the hypotheses could be related with the generated options before the decision. Like the scientific method as commonly known, managers needed to have hypotheses as bases of my possible alternative for a given problem. In addition, relevant data must be sought and gathered and the hypothesis logically tested and evaluated (Schafersman, 1991) by managers.
When a decision is finally made as to which course of action, it is inherent to consider the same as one that will attain best the defined objectives and foregoing of the other options not chosen together with their related advantages that cannot go with the chosen course of action. Such forgone advantages could be clearly considered as part of the limitations of the decision made.
Conclusion
To take things at face value would be akin to just obeying orders and denying power and responsibility for results. The managers question their underlying assumptions as they adopt the principle of case-to-case or situational basis without necessarily neglecting the use of applicable models when the manager could feel and justify the use of the same in the situation. Their generation of options or possible alternatives for a given management issues should prove their need for relating management issues to context. The fact also that managers have generated options before they choose their best course of action should be an indication of recognizing the limitation of their decisions of foregoing the advantages of the rest of options that cannot go with the chosen option.
References
Frey, L., Gouran, D. and Poole, M. (1999), The Handbook of Group Communication Theory and Research: Theory and Research, SAGE.
Johnson, G. and Scholes, K. (1993) Exploring Corporate Strategy – Text and Cases, Hemel Hempstead: Prentice-Hall.
Massie, J. (1987) Essentials of Management, Prentice-Hall International (UK), London.
Sammer, J. (2007) “Weighing pay incentives: Incentive plans should motivate employees to perform at a higher level, not encourage them to engage in questionable behavior”. HR Magazine.
Schafersman, S. (1991), An Introduction to Critical Thinking, Web.