A case study discussion of the Fox Relocation Management Corporation
There is an ancient Greek aphorism, "Know thyself." Nowhere is this statement truer than in analyzing the role management plays in a company. Every leader of an organization seeks to define his or her role and address the issues of the day as well as those that will inevitably arise. An academic approach to management theory allows for calibrations of structure, culture and client focus that can allow a company to focus. This paper will focus on the Fox Relocation Management Corporation and how its CEO Gretchen Fox directs and organizes the business with the goal of providing a better understanding of management theory.
In Drucker's pivotal essay "The Practice of Management" the fundamental managerial skill of feedback analysis is held up as a critical commodity. One can see from Gretchen's progress from a one person business over the past 11 years to her project reaching its current size. Yet while there have been positives there are areas where feedback would have helped. The positive is creating a clearly articulated vision and possessing the skills and the resolve to recruit and develop followers who are committed to carrying out the vision and having the ability to see the bigger picture and maintaining a balance between high level strategies and front line tactics. Yet, Gretchen failed to see the risk of established a centralized organization where power and influence spread out from a key figure. This led to the historical organization no longer being adapted to the continually growing business resulting in a new working structure to answer the challenges the company has to face.
Another major component of Drucker's analysis is the management of relationships and how these interactions influence the manager. If one argues that the role of manager is socially constructed and by assuming the role it shapes one's thinking, feeling and acting, Gretchen Fox will experience significant personal changes in her social function in the organization. How she defines herself will influence the culture and people around her, especially in regards to their attachment to the organization, to their work and to others. Understanding, experiencing and feeling in an organizational context allows people to develop multiple forms of attachment. The decision to move towards a less-centralized organizational structure will force employees to be loyal to the company and not to her personally. These changes will be done to enhance the functioning of company personnel and strengthen their dedication, yet how they interact with each other and with Gretchen Fox is a key component of such a change according to Drucker. Drucker emphasizes that change is not to be feard but understood in order for management to help grow and motivate a company. To keep the family culture, the idea is to clone the original cell as much as needed to face the increase in customer's demands. In order to do so, the self-managed concept might very well be the most accurate answer.
Empowering the employees gives them control and gives their jobs meaning.
When employees are involved in the creation and progress of their operations, they are more interested in their jobs. Also, they are more likely to remain involved and committed to their work. This creates a work environment where the employees know their mission and have a vested interest in its success. Supervisors then have more time to focus on being creative and innovative. The use of self-managed teams' programs generally improves organizational effectiveness. It can produce greater satisfaction, reduced costs, it help getting closer to customers, have very few layers of managerial bureaucracy, shorter time to answer to market demands as well as faster and better decision-making. In short, the changes being undertaken by Gretchen Fox can be analyzed using Drucker's framework. It is important that the management and structural changes utilize self-analysis to achieve the best outcome for the company as well as its employees.
One of the classic structures of management theory is to divide executives into Type X and Y style managers. Theory X and Theory Y represent two sets of assumptions about human nature and human behavior that are relevant to the practice of management. Theory X represents a negative view of human nature that assumes individuals generally dislike work, are irresponsible and require close supervision to do their jobs. Theory Y denotes a positive view of human nature and assumes individuals are generally industrious, creative, and able to assume responsibility and exercise self-control in their jobs. All of this theory comes out of the work of Douglas McGregor who in the 1950's criticized the management theory framework as inadequate for the realities of the workplace. He believed that the assumptions underlying it represented a negative view of human nature and that another approach to management based on an entirely different set of assumptions was needed. McGregor laid out his ideas in his classic 1957 article "The Human Side of Enterprise" and the 1960 book of the same name, in which he introduced what came to be called the new humanism. A further assumption often mistakenly made by management is that workers do not want responsibility and desire explicit direction. Additionally, individuals are assumed to put their individual concerns above that of the organization for which they work and to resist change, valuing security more than other considerations at work. Finally, human beings are assumed to be easily manipulated and controlled. Once these traditional structures are seen to be based on faulty premises, McGregor's conceptualization of management style is extremely valuable for evaluating management style, employee involvement, and worker motivation. Empirical evidence concerning the validity of Theory X and Theory Y, however, have been mixed. Some writers suggested that organizations implementing Theory Y tended to revert back to Theory X in tough economic times.Others suggested that Theory Y was not always more effective than Theory X, but that the contingencies of each managerial situation determined which of the approaches was more appropriate. So what type of company is Fox Management?
It can be surmised from the materials provided that Gretchen Fox has a Theory X management style. Starting out as a single operator and growing the business, all final decisions are made by her or her inner circle of close family members. Furthermore, the current structure has resulted in employees in the middle layers feeling that they have insufficient input. This has led to dysfunctional competition and jostling for the support of Gretchen Fox. The organization is dependent on the ability and judgment of the central power, which if weak then the organization will struggle. For Fox to continue growing, it needs to adopt new management structure based on employee initiative and self-control. This arthritic decision making style has led the company to its current situation where it is looking to switch over after more than a decade to a more Theory Y style to continue growing. Yet even within this change, there is variability, what must be done is ensure that performance evaluation is established to promote on merit rather than connections or time in the company. Although the conceptual linkages between Theory X and Theory Y assumptions and managerial styles are straightforward, research has not clearly demonstrated that the relationship between these assumptions and managers' styles of planning, organizing, leading, and controlling is consistent with McGregor's ideas.
The four major elements of any management process are effectiveness, efficiency, internal control and policy compliance. This entire process must be continuously evaluated and re-evaluated to ensure that a company is always progressing and becoming better. It is clear that Fox Management has not historically employed all 4 elements of this structure. The effectiveness of a process or management style is the extent to which it yields results. Clearly, Fox has been an extremely lucrative company with tremendous expansion from one individual to its current size. One example of the utility of the current structure at least historically is the growth of client projects within such a short period of time. One element where Fox Management has historically been weak is structural efficiency which is common to a quickly growing company. This can be seen in employees describing an ambiguous reporting structure and often sending emails to various superiors with conflicting answers. Fox as it has historically not had much of a self-analyzing structure will need to significantly improve its efficiency as it seeks to expand its size and geographically scale. The third element is internal control, meaning both service quality as well as uniformity of service. This element in the past has been maintained at Fox by keeping the same small cadre of decision makers and clients. With the new business structure, it will be critical in the initial phase that significant self-analysis be conducted to ensure that quality does not change with new personnel, new clients and an evolving business plan. Having defined company roles such as CEO, etc. with clearly defined responsibilities will facilitate designing and implementing effective internal control.…