Managing Teams across Borders
As indicated by Thanlain (2005) there are four characteristics that are in demand within a technology-oriented enterprise, namely: high market responsiveness, fast developments, low cost, and finally high levels of creativity, innovation and efficiency (Thamlain, 2005).
What must be understood though is that such characteristics are dependent upon the type of technical teams that are the backbone of the company wherein through the utilization of a variety of management practices a seamless integration of vertical and horizontal means of collaboration need to be implemented in order to create a stable organizational structure for proper operations and product development.
On the other hand what must be taken into consideration is the fact that though globalization and the process of outsourcing and off shoring technology teams are no longer isolated to merely being within the same building, state or country but rather are scattered across a wide breadth of countries, cultures and business cultures which management practices of contemporary technology-intensive enterprises need to take into consideration (Bhalla, Sodhi & Son,2008).
For example, Microsoft, which is one of the world’s largest software manufacturers, has development teams around the world working on different aspects of the operating systems that it produces.
The inherent problem with this situation is that different methods of coding procedure combined with a variety of problems related to time difference, business culture and sheer distance involved invites problems in all stages of OS development (Bhalla, Sodhi & Son,2008).
In fact, it was seen in the case of the development of Windows Vista that problems with the operating system (which was largely considered one of Microsoft’s worst operating systems) were due to problems in effective management practices in helping to consolidate efforts across different borders and cultures.
This situation is not limited to the development of software but rather also includes the production processes of certain electronic goods. For example, lax managerial practices were blamed for one of Dell corporations recent fiascos wherein faulty components within several of its computer motherboards that were sourced from foreign partners were seen actually leaking some sort of fluid during normal methods of operation.
Not only that, the fact that Dell actually knowingly resold such units despite knowing of the inherent flaws is indicative of a failure of management practices from not only a production point of view but from an ethical sales perspective as well.
Management practices in some of today’s technology-oriented organizations need to facilitate better collaboration and communication between global teams despite the distances and diverse cultural differences involved.
This means facilitating new means of cooperation through team exchanges (members of one team visiting the other), implementing means of open communication and conceptualization between the two teams at all times and facilitating better cooperative practices through the development of cultural understanding regarding how particular business cultures work over diverse locations.
It is only through this that effective practices can be implemented which result in characteristics mentioned earlier that are deemed necessary for a technology-oriented company to survive and to thrive.
Environmental Management
As Thamhain (2005) states “technology-intensive enterprises are constantly pushed towards performance initiatives that place an emphasis on doing things faster, better and with fewer resources” (Thamhain, 2005). In fact, this push towards better competitive performance through effective and more efficient resource utilization and allocation is one of the current driving forces of many high-tech organizations.
It must be noted though that the production processes of certain forms of technological output (i.e., consumer electronics, computer components, etc.) do have an impact on the local environment which should be taken into consideration by an organization that utilizes corporate social responsibility as one of the foundations of their managerial practices.
What must be understood is that the drive for faster, better and less resource-intensive production processes that are currently being pushed by various companies actually results in many of them choosing to utilize method of production that have an adverse impact on the local environment (Madsen, 2009).
Evidence of this can be seen in studies such as Ren, Liu, Qu, Berg, Qi & Xu (2010) that have examined the water quality in several of China’s industrial zones such as in Tianjin show an almost toxic level consistency of water run offs spilling into nearby bodies of water from several of these industrial zones (Ren, Liu, Qu, Berg, Qi & Xu, 2010).
Furthermore the air quality in such areas has also been shown to consist of a variety of carbon and chemical-based particulates that are the primary causes for the growing cases of lung disease and cancer within several of China’s expanding industrial cities.
It is mentioned by Thamhain (2005) that proper environmental management practices should be implemented by technology-oriented enterprises due to the need to comply with ethical and moral standards of operation and the fact that an organization that engages in questionable environmental practices usually develops a negative public image (Thamhain, 2005).
While there are certain challenges to this approach such as an increase in the cost of operations, lower production capacity, and the need to implement more stringent methods in the company’s operational procedure the fact remains that compliance to these ethical standards results in a better corporate image which resounds better with consumer groups especially when taking into consideration the growing focus on environmentally sustainable practices of industrial production.
Developing New Business – Innovation and Application
Thamhain (2005) indicates that research and development into new ways of producing and utilizing technology is one of the practices most often seen in technology-intensive enterprises (Thamhain, 2005).
This is due to the fact that technology has as of late been under a constantly accelerating level development and as a result has enabled new players to enter into markets whereas in the past distinct barriers to proper entry would have been present (Thamhain, 2005).
As such failure to sufficiently innovate along with new technological trends and products can be thought of as a failure on the part of the managerial practices at a company since being able to anticipate trends and use them to either reach greater market penetration or keep the company relevant to consumers is a necessity in today’s technology-intensive market economy.
One way of seeing this particular concept in action is to examine the case of Netflix and Blockbuster in order to see an example of the effect of proper/ improper managerial practices in dealing with new trends and how it impacts the consumer market share of a company.
From the early to late 1990s Blockbuster was a dominant force in the video rental industry with 3,645 stores across the U.S. and a market share of 90% of the industry it was in.
Unfortunately, while the Blockbuster business model was successful for several years the fact remains that aside from adding video game rentals to its product lineup the company never truly innovated its business model, especially when taking into consideration the growing move towards widespread internet usage within domestic households within the U.S. which were the primary consumer segment of Blockbuster.
By the mid-2000s a new company, Netflix, entered into video rental scene wherein through the use of an online website for video rentals and a mailing system where consumers could have DVDs delivered to their doorstep and deposit the envelopes that came with the DVDs in order to return the rented videos back to the company resulted in a widespread shift from Blockbuster to Netflix patronage especially when taking into consideration the cheaper prices Netflix offered due to lower operating costs.
The Netflix business model was faster, more efficient, utilized fewer resources and was more convenient for consumers. In other words the management practices implemented by Netflix is in accordance with what Thamhain (2005) states as technology-intensive enterprises utilizing performance initiatives that place an emphasis on doing things faster, better and with fewer resources (Thamlain, 2005).
Looking at the case of Blockbuster it can be seen that not only did they not even attempt to change their business model but they never even thought to take into account the entry of new players into the market that may affect their dominant position. As stated earlier due to the rapid rate of technological development the entry of new companies into a variety of markets is easier than ever before.
By not taking such factors into consideration Blockbuster lost its dominant position over a period of six years as evidenced by its plummeting stock value, lower consumer patronage and the fact that it had to close thousands of stores due to operating costs and the fact that few consumers were even going to them.
It is based on this that it can be seen that the development of new business approaches based on current trends in technology as well as innovating current business practices to take into account new consumer trends that have developed as a result of technological innovation as well is an important practice that technology-intensive enterprises should do in order to continue to stay relevant otherwise they may fall into the same predicament as Blockbuster.
Reference List
Bhalla, A., Sodhi, M. S., & Son, B. (2008). Is more IT offshoring better?: An exploratory study of western companies offshoring to South East Asia. Journal of Operations Management, 26(2), 322-335.
Madsen, P. M. (2009). Does corporate investment drive a “race to the bottom” in environmental protection? Academy of Management Journal, 52(6), 1297-1318.
Thamhain, H. (2005). Management of technology. New Jersey: John Wiley & Sons.
Ren, H., Liu, H., Qu, J., Berg, M., Qi, W., & Xu, W. (2010). The influence of colloids on the geochemical behavior of metals in polluted water using as an example Yongdingxin River, Tianjin, China. Chemosphere, 78(4), 360-367. doi:10.1016/j.chemosphere.2009.11.018