suppliermanagement

Supplier Management: Building Strong Partnerships, Controlling Risk, and Improving Business Performance

In any organization, suppliers play a critical role in business success. Companies depend on suppliers for raw materials, products, services, equipment, and many other operational needs. If suppliers fail to deliver on time, deliver poor quality, or increase prices unexpectedly, the entire business operation can be affected.

Many organizations focus heavily on customers but do not manage suppliers properly. However, suppliers are just as important as customers because without reliable suppliers, organizations cannot serve their customers effectively.

Supplier management is not just about selecting a supplier and placing orders. It is about building relationships, monitoring performance, controlling risks, and ensuring long-term business stability.

What Supplier Management Really Means

Supplier management is the process of:

  • Identifying and selecting suppliers
  • Negotiating prices and contracts
  • Evaluating supplier performance
  • Managing supplier relationships
  • Monitoring supplier risks
  • Ensuring quality and delivery performance
  • Developing long-term supplier partnerships

The objective of supplier management is to ensure reliable supply, good quality, competitive pricing, and low risk.

Good supplier management helps organizations:

  • Reduce costs
  • Improve quality
  • Ensure timely delivery
  • Reduce supply risks
  • Improve operational efficiency
  • Build long-term business partnerships

Supplier management is therefore a strategic function, not just a procurement activity.

What Happens When Supplier Management Is Poor

When organizations do not manage suppliers properly, they face many problems:

  • Late deliveries
  • Poor quality materials or products
  • Frequent price increases
  • Supply shortages
  • Dependence on one supplier
  • Communication problems
  • Contract disputes
  • Unreliable service
  • Production or delivery delays
  • Customer complaints

These problems affect operations, increase costs, and reduce customer satisfaction.

Many companies think procurement problems are internal, but often the problem is poor supplier management.

Business Example

Consider a manufacturing company that relied heavily on a few suppliers but did not evaluate their performance regularly. Over time, the company faced several problems:

  • Raw materials were delivered late
  • Some materials were of poor quality
  • Production was delayed
  • Urgent purchases had to be made at higher prices
  • Customer orders were delayed
  • Production costs increased

The company then implemented a structured supplier management system:

  • Supplier selection criteria
  • Supplier performance evaluation system
  • On-time delivery tracking
  • Quality performance tracking
  • Supplier review meetings
  • Multiple supplier strategy for critical items
  • Long-term contracts with key suppliers

After implementing these changes:

  • Delivery performance improved
  • Material quality improved
  • Production delays reduced
  • Emergency purchases reduced
  • Supplier relationships improved
  • Overall operational performance improved

This shows that good supplier management improves the entire supply chain.

Supplier Management and the OTP Framework

Supplier management is another area where the OTP Framework (Operations → Transparency → Profit) can be applied effectively.

1. Visibility (Seeing Supplier Performance Clearly)

Organizations must have visibility of:

  • Supplier prices
  • Delivery performance
  • Quality performance
  • Lead times
  • Order history
  • Supplier reliability
  • Contract terms
  • Supplier risks

With visibility:

  • Poor-performing suppliers can be identified
  • Better negotiation decisions can be made
  • Risks can be managed
  • Supplier performance can be improved

2. Accountability (Responsibility for Supplier Performance)

Clear responsibility must be assigned:

  • Who is responsible for supplier selection
  • Who is responsible for supplier evaluation
  • Who manages supplier relationships
  • Who monitors supplier performance
  • Who handles supplier complaints

When accountability is clear:

  • Supplier performance improves
  • Communication improves
  • Problems are solved faster
  • Supplier relationships become more professional

3. Control (Managing Suppliers Systematically)

Supplier management must be controlled through:

  • Approved supplier list
  • Supplier evaluation system
  • Supplier performance scorecards
  • Contracts and service level agreements (SLAs)
  • Supplier audits
  • Supplier review meetings
  • Multiple supplier strategy
  • Risk management plans

Control ensures suppliers are managed professionally, not randomly.

4. Profit (Result of Good Supplier Management)

When suppliers are managed properly:

  • Purchase prices improve
  • Quality improves
  • Delivery delays reduce
  • Production and operations become smoother
  • Emergency purchases reduce
  • Customer satisfaction improves
  • Operational costs reduce

All these improvements lead to higher profitability.

Key Supplier Management Practices

Organizations should implement the following supplier management practices:

1. Supplier Selection Criteria

Select suppliers based on:

  • Price
  • Quality
  • Delivery reliability
  • Financial stability
  • Experience
  • Capacity
  • Location
  • Service level

2. Supplier Performance Evaluation

Evaluate suppliers based on:

  • On-time delivery
  • Quality performance
  • Price competitiveness
  • Responsiveness
  • Service level

3. Supplier Scorecards

Create a scoring system to measure supplier performance regularly.

4. Supplier Review Meetings

Meet key suppliers regularly to discuss performance and improvements.

5. Supplier Development

Help important suppliers improve quality, delivery, and service.

6. Multiple Supplier Strategy

Avoid depending on only one supplier for critical items.

7. Supplier Risk Management

Identify and manage risks such as:

  • Supplier financial problems
  • Political risks
  • Supply disruptions
  • Transportation issues

Suppliers as Business Partners

Organizations should not treat suppliers only as vendors.
They should treat important suppliers as business partners.

Strong supplier partnerships lead to:

  • Better pricing
  • Priority supply during shortages
  • Better quality
  • Faster delivery
  • Innovation and new product development
  • Long-term business stability

Companies with strong supplier relationships usually have strong and stable supply chains.

Final Thought

Suppliers are a critical part of any organization’s success. Poor supplier management creates delays, quality problems, and high costs. Good supplier management improves operations, reduces risks, and increases profitability.

When supplier management is structured and controlled:

  • Supplier performance becomes visible
  • Responsibility becomes clear
  • Supplier processes become controlled
  • Supply chain becomes stable
  • Costs reduce
  • Operations improve
  • Profit increases

At Talent Consultancy, we help organizations develop supplier selection systems, supplier performance evaluation systems, supplier scorecards, supplier risk management frameworks, and supplier relationship management strategies to improve supply chain performance and profitability.

Because when suppliers are managed properly:
Supply becomes reliable, quality improves, costs reduce, operations run smoothly, and business performance improves.

Generations

Understanding The Generational Differences

The generational background greatly influence in people’s communication as a result of their unique characteristic of their generation which has been discussed here in this article in detail with the referencing of relevant literature which would definitely favour to the management to deal the employees according to the differences in the generations and assist them to stop further confrontation, misunderstanding in the working environment.

Under this review on the literature of Demography, I would like to discuss the workforce generations who are the focus of this study. They are Traditionals, Baby Boomers, Generation X, Generation Y and Generation Z (Johnston, 2010). They have been defined by the previous research by various people on the study of generations. I would like to point out some important key information from their quotation herewith first.

According to the statement of Bennet et at (2012) there are generations who are having different values, morals, dreams, desire, ambition, and style of working.  Each generation has been influenced by wars, social events, technological breakthroughs, etc. Therefore, It is very important to know their characteristics and behaviours which influence the organizational behavior through the individual, group and structure of the behavior of the organizations.

Age Period of the Demographies:

The traditionalists are the one who was born between 1909 and 1945. The Baby Boomers are the generation who was born between 1946 to 1964. They are about 40% of the current workforce (McDonald 2008, p. 63). Generation X are born between 1965 to 1978, and Generation Y is considered to be the generation between 1979 to 1996 (Johnston 2010).  The meanwhile the Generation Zers refers to those who was born between 2000 to 2020.  According to McDonald (2008, p. 62) notes, the differences between the generations are deeper. Through this review I will discuss each of these generations in detail, based upon the current literature.

Traditionals:

This generation is called as Silent Generation or the Veterans who were the employees and retired people, born between 1922 to 1945. Most of them had retired already or died too. Some of them still continue their service in some organizations and re-entered too. They are working as executive leaders in the organizations.  (“The Traditional Generation”, n.d.). These traditionals had played a major role and helped to develop the space research and invented many vaccines for the diseases such as Polio, Tuberculosis, Tetanus, and Whooping Cough etc. This is the generation had big contribution for Equality through Civil Rights Movements. 

The values of this generation are to be noted as discipline, strictly follow rules and having belief in logic and loyalty to the working place. They have unique style of work in uniformity and consistency and focus more on hierarchical organizational environment.

Baby Boomers:

Baby Boomers are ambitious, hardworking and competitive individuals in their working environment  (Johnston, 2010; McDonald 2008, p. 63). They are more loyal to the organization and more reliable than the younger generations. (Dychtwald and Baxter 2007, p. 327). McDonald (2008, p. 63) pointed out that even though many of them are going to the age of retirement, they are still working in the organizations, because they are in the position of senior leadership level. They are mostly in higher level position in the organizations. They are more experienced and would like to continue to work too. But, they don’t like more advancement. They have a high value on job security and accessing resources. They are more committed in their work place. They tend to turn down promotional opportunities much because they want to continue their job.  (D’Amato and Herzfeldt 2008).

Baby boomers are born and influenced by world war II heroes. They are against traditional norms but follow the traditional work ethics and they think that the work should be meaningful and they also value the relationship building in the work place.

Generation X:

Generation X are born between 1965 to 1978. They were much influenced by Iranian hostage problem, the Iran Contra Scandal, the introduction of HIV / AIDS diseases and oral contraceptive pills, the oil crisis on in 1973, and the introduction of computers and Internet, the cold war . (Dries et al. 2008; Crumpacker and Crumpacker 2007; Weingarten 2009). 

Generation X workers are highly responsible workers and they are more accountable on the work. They want a fair compensation as a motivation to the job done at work. They expect more personal recognition to the work done by them comparing to Baby Boomers. In 1980,Generation X entered into the workforce at the time world economy was on downturn. Therefore, they were also loyal to the particular organization and work sincerely with commitment to their organization. They were also motivated by interesting and meaningful work at their organization. Generation X workers are much focus on creating amazing outcomes for their organization. At the same time they are much more responsive to particular leader than the company. As a result they don’t continue to work in one place. They also don’t value the micromanagement too. (Johns 2003)

Generation Y:

Generation Y is considered to be the generation between 1979 to 1996 (Johnston 2010). They are much motivated by  Salary. They want to have more free time. They are more interested in maintaining their work life balance ever. (Barford and Hester 2011, p. 75). Generation Yers are more positive and idealistic and inclined to value tradition like Baby Boomers. They also have more strong sense of morality and civic mindset. Generation Yers are mostly highly educate and comfortable with technology (also refer to Ferri-Reed 2010, p. 32), but they are less independent generation. They are also much competitive too. Reisenwitz and Iyer (2009, p. 92) 

Generation Yers are also very good at multi tasking and technologically savvy too. They like more team work and to have an engagement intellectually in their working environment.  They also want to maintain a work life balance too. They don’t want to work long hours at work. They are multi taskers and changing their job is their part of their daily routine. They are focus on personal fulfillment too.

Generation Z:

Generation Zers refers to those who was born between 2000 to 2020. They came after Generation Y. This generation starts to enter into workforce now. They have a high value on their education and much worried about their future careers and have a high hopes in changing the world as a better place ever. They are completely native to digital era. They have a strong multi tasking skills as a result of their technological expertise. They want to be more self starters and entrepreneur  too. This generation is also known as “silent” generation due to the ruling of world technology. They are also called as iGeneration. They take internet for granted and social media such as Face book, twitter, whatsup, viber and google as their community. They are much familiar with people through online cyber space more. They don’t want to have personal meeting with their  friends for relationship. They use only website as the medium for maintaining relationship much. They consider living with others as invasion of their space. They have a different interpersonal skills from other generation. They have lack of interpersonal skill which are needed to relate to individual. (Generation Z Characteristics, 2007).

Reference:

Robbins, S. and Judge, T. (2013) Organizational behaviour, Johanneshov: MTM

academia.edu (2019), academia’s official website [online], available at :https://www.academia.edu/36759175/The_Employees_of_Baby_Boomers_Generation_Generation_X_Generation_Y_and_Generation_Z_in_Selected_Czech_Corporations_as_Conceivers_of_Development_and_Competitiveness_in_their_Corporation(Accessed on 25th of April 2020)

axerosolutions.com (2023), axerosolution’s official blog [online], available at: https://axerosolutions.com/blogs/timeisenhauer/pulse/302/14-foolproof-tips-for-managing-generational-age-gap-in-the-workplace (Accessed on 25th of April 2020)

The Pivotal Role of Stakeholders in Business Operation

Business is an economic activity, where buying and selling occurs. In this process, there are numerous people such as individual, groups or organization who have the interest in the decisions, operations, and outcomes of the business. These people can influence or be influenced by the business activities. Generally, these are called as stakeholders, are categorized into internal and external stakeholders.

1.⁠ ⁠Internal Stakeholders:

The internal stakeholders are the people who are inside of the organization. These people are owners who invest in business and expect returns for their investment in the form of profits or dividends. The other stakeholder is managers who are responsible in decision making process in managing and supervising the resource utilization and ensure the goal achievements of the business while balancing the needs of other stakeholders. Another most important internal stakeholder in business are the employees who contribute considerably to run the business operations smoothly and successfully and they expect fair wages, job security and good working condition.

2.⁠ ⁠External Stakeholders:

External stakeholders are individuals or groups outside of the organization who are affected by the operations. Business must take heed in managing the relationship effectively as they greatly influence being outside of the business who cannot be avoided in the business activities. 

The most essential people who are to be firstly connected and focused are our valued customers, for whom the whole business setting ups everything to create values for their money by providing product and services. The other most important stakeholder is suppliers who play immense role in the supply of raw materials required to business and also expected to continue to support via a long-term partnership. At the same time, there should be a strong relationship by releasing their payment on time as promised via supplier contracts. Another stakeholder shows interest of the business and influence in decision making process is investor who provides financial support and expect financial stability and return for the investment. 

The meanwhile government and regulators play significant role as they enforce laws and regulations, collect taxes, and expect compliance with legal and ethical standards. Moreover, community where the business exists and operates expected to be responsible in the social responsibilities by providing employment and contribute to local development. At the same time, business always has an eye on the competitors as they influence and are influenced by industry standards and business strategies. Similarly, business cannot ignore media, trade unions and creditors for their enormous contribution in becoming an effective organization when these organization are considered and treated with responsible manner as they show great interest and influence the business process as other type of stakeholders.

In this respect, there are numerous stakeholder models are designed to help businesses identify, prioritize, and manage their relationships with stakeholders. These models vary based on the nature of the business and its goals. One of the well reputed model is stakeholder mapping model in which stakeholders are mapped based on their interest and influence in the business. One is High Interest, High Influence: Manage closely (e.g., major investors, government).The other one is High Interest, Low Influence: Keep informed (e.g., local communities). Next is Low Interest, High Influence: Keep satisfied (e.g., regulators). The last one is Low Interest, Low Influence: Monitor (e.g., distant competitors).

On the other hand, it is essential to establish effective stakeholder engagement which fosters trust, enhances collaboration, and supports the achievement of business objectives. There are key objectives of stakeholder Engagement that must be considered in managing with stakeholders to make organization effective in the business process. They key objectives are listed below.

1.Understanding Stakeholder Needs: Ensuring stakeholders’ expectations are aligned with organizational goals.

2.Building Trust and Collaboration: Strengthening relationships through transparency and regular communication.

3.Managing Risks: Anticipating and addressing potential conflicts or resistance.

4.Enhancing Decision-Making: Leveraging diverse perspectives to make informed decisions.

5.Ensuring Sustainability: Aligning business practices with social, environmental, and economic responsibilities.

The meantime, business should consider the challenges in Stakeholder Engagement and deal with accordingly too. The challenges are listed below.

1.Conflicting Interests: Balancing the needs of multiple stakeholders can be difficult.

2.Lack of Resources: Limited time, budget, or personnel can hinder engagement efforts.

3.Resistance to Change: Some stakeholders may oppose new initiatives or strategies.

4.Cultural Differences: Misunderstandings may arise in diverse stakeholder groups.

In this respect, there are tools for stakeholder engagement are used to prioritize the stakeholders, to gather stakeholder feedback, to track communication and engagement and for collaborative problem solving via stakeholder analysis matrix, surveys and questionnaires, customer relationship management and workshops and seminars respectively.

Conclusion:

It is crucial to understand the pivotal roles of both internal and external stakeholders while considering their interest, contribution and influence in the decision-making process and manage them wisely with the intention of making the business effective and take the market leadership and take competitive advantage.

Reference:

Books:

Freeman, R.E., Harrison, J.S. and Wicks, A.C., 2007. Managing for stakeholders: Survival, reputation, and success. Yale University Press.

Bryson, J.M., 2018. Strategic planning for public and nonprofit organizations: A guide to strengthening and sustaining organizational achievement. 5th ed. Wiley.

Journal Articles:

Greenwood, M., 2007. Stakeholder engagement: Beyond the myth of corporate responsibility. Journal of Business Ethics, 74(4), pp.315-327.

Websites:

International Association for Public Participation (IAP2), 2018. Core values for the practice of public participation. [online] Available at: https://www.iap2.org [Accessed 21 December 2024].

Leadership

Understanding The Concept of Leadership 

The success and failures are depending on the leaders who lead their people in any situation. In particularly, when we look at the success of a business and its failures are based on the leadership styles where the employees are led by the leaders. In this respect, it is essential to have a broader understanding the concept of leadership for those who are already leading people or want to become a leader in the future.

If a person who wants to become a leader who should be able to lead the people by showing a clear direction where these people to be led. There should be followers to lead. The leader has the ability of leading people by building up the trust of the people and earning the respect of them. If followers fail to trust a leader who will not be ready to go behind him. 

Therefore, building up trust among the followers is crucial aspect a leader ever focuses. However, the leader should be able to convince the follower by displaying his knowledge and ability to lead them through which he can earn the respect of the people. Then only, the followers would be ready to follow a leader.

What is leadership?

There are numerous understandings in defining the concept of leadership. However, there is a general understanding about leadership. It is the process of encouraging and assisting others to work enthusiastically toward achieving the set goals and objectives. It is the behaviour of an individual when he is directing the activities of a group towards a shared-goals. It is the leadership in which one person influences others to work together willingly on the related task to attain goals desired by the leader.

When we understand the above general definition about leadership, a leader should be able to direct his people towards achieving the shared goals and having the ability to influence the followers so that they work together to achieve what the leader desires to achieve. 

If you take a business organization where the CEO tries to influence his team of people who are under him as middle level managers in-charge for business units under whom there are several functional managers working in the business functional areas such as operations, marketing and sales, human resource management, financial management, research and development etc. 

Hence, the role of leadership in a business environment is vital who has to lead the people by utilizing his power, influencing them through his integrity, and providing the direction by developing business strategy through evaluating the business environments where there are opportunities and threats he would identify and deal with them with the support of the internally available strength and minimizing the weaknesses. At the same time, leader is the one setting up a culture in order to achieve the set goals and empower the people who support to win the competition which is in the external environment.

In this respect, a leader has to provide a strategy direction, empower people, motivate and guide his people when necessary. He also has the ability of challenging and changing the statuesque of the organization as he is the one brings the change into the organization as the business environment has dynamic changes in many aspects in the external environment every day.

The ingredients of leadership:

According to Prof. Warrant Bennis (2009,p.34) he defines the ingredients of leadership. A leader should have a guiding vision, passion, integrity, curiosity & daring. 

Four qualities expected from great strategic leaders

At the same time there are four qualities expected from great strategic leaders. They are 

1.Strategic thinking

2.Strategic acting

3.Strategic influencing 

4.Strategic modeling. 

What effective leaders do?

These effective leaders would do the following things when they lead people effectively.

1.Setting clear goals

2.Understanding others

3.Making quick decisions 

4.Being creative

5.Staying honest

6.Staying strong and powerful

7.Including everyone

8.Delegating smartly

9.Getting better in everything

10.Having effective communication

What are the great qualities displayed by the leadership?

You can see seven sings that would display the leadership qualities in great leaders.

1.Always give you credit

2.Welcome your ideas

3.Encourage your growth

4.Care about your well-being, not just your work only

5.Value your personal time

6.Leade by example

7.Make tough decisions with compassion.

Eight traits of ethical leadership

Dr. Valeria Lo Lacono(2023) noted that there are 8 traits you can see in the ethical leadership. They are as follows…

1.He is promoting EDI (equality, diversity and Inclusion) as a leader

2.He is transparent and approachable

3.He is able to show empathy and compassion

4.He is socially responsible

5.He is trustworthy and trusted by the followers

6.He leads by great examples. People would follow the shadow of him

7.He develop a psychologically safe workplace for employees

8.He has the integrity and having the best interest of the company at heart and speaking both financially and morally.

Strategic Leadership:

Furthermore, a leadership direct the people strategically. Strategic leadership has the responsibility of providing strategic direction to the people who works with him by establishing a balanced organizational control, effectively managing organizational resource portfolio, sustaining an effective organizational culture and emphasizing ethical practices under his leadership. He should also have strategic leadership qualities to lead people strategically. Let’s understand some definition here so that it would be easy to digest this strategic concept of leadership in detail.

The definition of strategic leadership denotes “the leader’s ability to anticipate, envision, and maintain flexibility and to empower others to create strategic change as necessary” (Hitt, Ireland, & Hoskisson 2008: 375).  Moreover, strategic leadership demands the capability to incorporate and include both of the business environment of the organizations, which are internal and external. It is also responsible for managing and encompassing critical information processes.

Furthermore, there are many recognizable actions which determine strategic leadership towards effective strategy enactment. They are in the following: 

1.Determining strategic direction 

2.Establishing balanced organizational controls 

3.Effectively managing the organization’s resource portfolio 

4.Sustaining an effective organizational culture 

5.Emphasizing ethical practices organizational controls

Leadership Styles & Theories:

There are numerous leadership theories produced by the scholars. It is a high time to have some understanding so that it will be easy to differentiate the current leadership you might see in your day-to-day life.

Gandhi’s Servant Leadership Approach:

•  The leader of the Indian independence movement against British rule, exemplified servant leadership throughout his life.

•     He dedicated himself to serving others, prioritizing the needs of the community over personal gain or power.

•  Gandhi emphasized principles such as humility, empathy, and selflessness, advocating for nonviolent resistance as a means to achieve social and political change.

•  His leadership style was characterized by a deep commitment to empowering marginalized communities, promoting social justice, and fostering unity among diverse groups.

⁠Gandhi’s servant leadership approach inspired millions of people around the world and played a pivotal role in India’s struggle for independence.

Abraham Lincoln’s Crisis Leadership Approach:

•       Background: Abraham Lincoln’s presidency and leadership during the Civil War.

•  Communication Skills: Lincoln’s exceptional communication skills, including his ability to inspire, persuade, and unify the nation through his speeches and writings.

•   Crisis Leadership: Lincoln’s leadership during the Civil War, focusing on his decision-making, crisis management, and ability to maintain morale and resolve in the face of adversity.

•   Emotional Intelligence: Lincoln’s empathy, humility, and resilience as key components of his leadership style.

Nelson Mandela’s Transformational Leadership Approach:

·      Background: Nelson Mandela’s life -his role in the anti-apartheid movement and his presidency in South Africa.

·      Leadership Qualities: resilience, forgiveness, empathy, and his ability to unite people across racial divides.

·      Transformational Leadership: leader inspired change and reconciliation in South Africa.

·      Crisis Management: Mandela navigated through the challenges of apartheid, imprisonment, and the transition to democracy.

Donald Trump’s Transactional Leadership Approach:

·      Background: 45th President of the United States, Donald Trump was known for his transactional leadership  

·      Leadership Qualities: Trump prioritized outcomes over processes, often emphasizing his ability to make deals and deliver on campaign promises.

·    Hi s transactional leadership style relied heavily on rewarding loyalty and punishing dissent, with a focus on individual performance and accountability.

·     Trump’s transactional leadership approach results-driven mindset, criticism for its divisiveness, lack of collaboration, and disregard for institutional norms and processes.

Jack Welch’s Strategic Transformational Leadership Approach:

·    Background: Jack Welch’s tenure as CEO of General Electric.

· Strategic Leadership: Welch’s strategic transformational leadership approach, focusing on initiatives such as Six Sigma and the boundaryless organization.

·   Performance Management: Welch’s performance management techniques, including his emphasis on meritocracy and accountability.

· Organizational Transformation: Welch transformed GE into a global powerhouse through acquisitions, and strategic alliances.

Steve Job’s Visionary Innovative Leadership Approach:

·      BackgroundHis role in founding and leading Apple.

·      Leadership Style: visionary leadership style, his emphasis on innovation and excellence, and his ability to inspire and motivate his team.

·      Decision Making: key decisions made as the development of iconic products like the iPhone and the iPad, and his approach to decision-making contributed to Apple’s success.

·      Challenges Faced: Explore challenges faced internal conflicts and market competition   

·      Lessons Learned: Innovation, and strategic vision from Jobs’ leadership at Apple.

Great Man Theories:

·      Leaders are exceptional people who are born with innate qualities and destined to lead others

Trait Theories:

•  Leaders are having leadership traits or qualities associated with leadership which is hard to measure.

•    Traits of leaders are adaptable to situations, alert to social environment, ambitious and achievement oriented, assertive, cooperative, decisive, dependable, dominant to influence others, energetic, persistent, self-confident, tolerance of stress, willingness to take responsibility. (Stogdill, 1974)

Functional Theories:

•       Leaders are concerned with the interaction Task, Team and Individual.

•       Task: Goal setting, methods and process

•       Team: Effective interaction  and communication

•       Individual: Attention to behavior, feelings, coaching

However, in the contemporary business world, transformational leadership is highly expected from the leadership who has 4I in this style of leadership. According to B.M.Bass and B.J.Avolio (1990, p.231-272) it has been clearly discussed.

Charisma or idealized influence:

It is the emotional component of leadership (Antonakis, 2012). Idealized influence describes leaders who act as strong role models for followers; followers identify with these leaders and want very much to emulate them. These leaders usually have very high standards of moral and ethical conduct and can be counted on to do the right thing. They are deeply respected by followers, who usually place a great deal of trust in them. They provide followers with a vision and a sense of mission. 

Intellectual Stimulation:

It includes leadership that stimulates followers to be creative and innovative and to challenge their own beliefs and values as well as those of the leader and the organization.  This type of leadership supports followers as they try new approaches and develop innovative ways of dealing with organizational issues. It encourages followers to think things out on their own and engage in careful problem solving. 

Inspirational Motivation:

This factor is descriptive of leaders who communicate high expectations to followers, inspiring them through motivation to become committed to and a part of the shared vision in the organization. In practice, leaders use symbols and emotional appeals to focus group members’ efforts to achieve more than they would in their own self-interest. Team spirit is enhanced by this type of leadership. 

Individualized Consideration:

This factor is representative of leaders who provide a supportive climate in which they listen carefully to the individual needs of followers. Leaders act as coaches and advisers while trying to assist followers in becoming fully actualized. These leaders may use delegation to help followers grow through personal challenges. 

In Conclusion:

No leadership, no direction. No followers, no leadership. A leader should have emotional intelligence in order to manage himself and others and provide his style of leadership according to the situation. Although leaders are born with inborn leading characteristics to lead others, it is not essential to be born to be a leader. Those who would like to become a leader who can focus on building up leadership traits and adopt a suitable approaches that I have highlighted from the shadows of leaders in this article. However, It is a widely accepted concept of leadership in the current business world is transformational strategic leadership which has to be kept in mind and develop the necessary initiatives to adopt in the real life.

Reference:

The John Adair (2004.) Hand book of management and leadership ,  Available at: https://www.pdfdrive.com/the-john-adair-handbook-of-management-and-leadership-e10045610.html (Accessed on 10/07/20)

Harward Schultz: Ethical and Strategic Leadership  (2014) YouTube video, added by Blake Beckmann [Online]. Available at  https://www.youtube.com/watch?v=GOO_ufk7utI&feature=youtu.be  [Accessed 16 August, 2020].

Imran Butt (2017.) Leadership and management concepts, Slideshare ,  Available at: https://www.slideshare.net/pakarmy4923/leadership-and-management-concepts-starbucks?qid=3f4fe6fa-fb9c-4c41-b94e-191253d7a189&v=&b=&from_search=2 (Accessed on 16/08/20) 

Critical incident technique  (2016) YouTube video, added by Ellen Cordeiro [Online]. Available at  https://www.youtube.com/watch?v=l-oaezn8lVU [Accessed 19 August, 2020].

Management by objectives  (2016) YouTube video, added by Madalena Caetano [Online]. Available at  https://www.youtube.com/watch?v=0qM5YYWaRC4 [Accessed 19 August, 2020].

360 degree performance appraisal  (2019) YouTube video, added by Commerce point [Online]. Available at  https://www.youtube.com/watch?v=2dvSM9IM97w [Accessed 19 August, 2020].

Tucker BA, Russell RF. The influence of the transformational leader. J Leadership Organizational Studies. 2004;10(4):103-111. 

Goleman D. Leadership that gets results. Harvard Business Review. 2000;78(i2):90. 

Bass, B.M. (1997), “Does the transactional/transformational leadership paradigm transcend organizational and national boundaries?”, American Psychologist, Vol. 52 No. 2, pp. 130-139. 

Rafferty, A.E. and Griffin, M.A. (2004), “Dimensions of transformational leadership: conceptual and empirical extensions”, The Leadership Quarterly, Vol. 15 No. 3, pp. 329-354. 

Tourish, D. (2013), The Dark Side of Transformational Leadership: A Critical Perspective, Routledge, New York, NY. 

business-concept

Understanding The Concept of Business

It is crucial to have a vivid understanding the concept of business, a business owner when he invests his capital in business ventures. When we look into the market, there are several businesses opened and closed in few months and years. Some businesses become successful and some fails. Therefore, It is vital to pay special attention to comprehend the concept of business in detail before enter into this venture. 

Once one started his business after investing his valuable money, which he saved, has to be protected and cannot be lost. As a result, one should think deeply before investing. Once invested, He has to maintain without closing his business. because, business is a long-time activity. The meanwhile, the business owner has to be more patient and work hard in managing his business venture until he gets back the amount of money he invested in his fixed assets which is called break-even point. Before technically delve the concept of business, Let’s understand the what is business about. 

What is business?

Indeed, Business is an economic activity, where buying and selling occurs.  Because of the business, there are numerous things around us. Customers are waiting for their products and services. The business is creating values to the customer for their money when they pay in business. 

Customers needs, wants are fulfilled and their problems are sold and satisfied while the business owners enjoy their profitability and increase their wealth because of these economic activities. When the business owners invest their money in setting up their business, they are also happy and satisfied as they become profitable in their business ventures. 

Moreover, It is specially to be understood that business is a risk taking activity. As there are uncertainties in business ventures owing to the environmental changes occurring, business owner has to be vigilant about the external environmental changes which is called PESTEL environment (Political, Economic, Social, Technological, Ecological and Legal Environments) that is dynamic in nature and changes dramatically every day. 

As a result, a business owner when he invests his money, he has to be precautioned and vigilant on PESTEL environment ever. This business environmental analysis would be discussed in another article that would be much beneficial for business owner when he continues to develop his business process.

Considering the above, It is essential to define about business. According to Peter Ducker, who is called father of business in this contemporary world and his understanding on concept of business to be shed light here to have a comprehensive understanding about the concept of business.

Peter Drucker believes that the primary purpose of business is to create a customer and also emphasizes the importance of satisfying the customers by fulfilling their needs and wants by creating values for them which should be the central focus of any business when created.

These are the following understanding to be paid special attention by every business owner in their business ventures.

1. Customer-Centric Approach: The main objective of a business is to serve its customers. The business should take heed in the needs of customer when tailoring its products or services accordingly. Therefore, each business owner should identify his target customer first for whom the value is to be created for the money paid in business.

2. Innovation and Marketing: He emphasized the crucial role of innovation and marketing in creating and maintaining customers in business which would lead to the victory of any business. As a result, every business owner has to be innovated and differentiated his business venture according to their target market which would be essentially focused in business.

3.Management by Objectives: Setting clear goals and objectives for business activities to be defined which would allow for effective management and measurement of performance in business. In this respect, a business owner has to define his business long term direction where the business to be taken forward. He has to have a vivid end in mind at the initial point before starting his business process. 

4.Human Resource Development: Employees are the most important asset in an organization who should be provided for continuous training and development opportunities in the workplace. Business should always bring the right human resources and retain them by making them competent via training and development programme so that the organization achieve its competitive edge.

5. Social Responsibility: Businesses should always focus on profits. However, it also considers the social and ethical responsibilities in managing the business process that should contribute positively to society through the business ventures. On this basis, Business owner should focus on triple bottom line concept (Profit, People & Planet) which would establish corporate social responsibility (CSR) which is one of the most valued indicators of contemporary business in evaluating business organizations.

6. Management as a Discipline: Management as a discipline has to be considered that would foundational principle process in modern business management. Hence, Business owners should always set up their business system and principles as a discipline when they operate in their process of value creation to satisfy the customers’ needs and wants.

Overall, Peter Ducker’s perspective on business should be focused when a business owners create values for customer with the intention of satisfying their customer needs, and They should think of innovating their business process and marketing them to the target market. The meanwhile, Peter Ducker emphasized that business owners should establish sound management practices that consider the well-being of employees and the larger society in the process of business venture and carry forward considering profitability and customer satisfaction.

Reference:

1.⁠ ⁠Drucker, P. F. (1954). The Practice of Management. Harper & Row.

2.⁠ ⁠Drucker, P. F. (1959). The Landmarks of Tomorrow. Harper & Brothers.

3.⁠ ⁠Drucker, P. F. (1967). The Effective Executive. Harper & Row.

4.⁠ ⁠Drucker, P. F. (1973). Management: Tasks, Responsibilities, Practices. Harper & Row.

5.⁠ ⁠Drucker, P. F. (1993). Post-Capitalist Society. Harper Business.

6.⁠ ⁠Drucker, P. F. (2001). The Essential Drucker. Harper Business.

Training

Understanding The Concept of Training in The Organizational Development

Human resource is the most important resource which has to be managed in an organization. If an organization wants to become an effective organization, it has to take heed in its resource utilization in the process of business operation. 

As a result, efficient utilization of resources creates more values not only to organization but also to the valued customers who demands the products and services from the organization for their money their money they pay. 

In this respect, an organization should take a strategic decision in the utilization of human resources as it is a vital resource that assist an organization to take competitive advantage in focusing its core competent resource. Therefore, human resource department has to pay special attention in inducting the right people to perform the right job in the organization who are competent to perform their day-to-day operational activities. 

Once an organization hired the right people and onboarded them in the workplace, there is an essential role of HR to focus on training and development of the employees who really need to run the existing system of the organization. The initial training provided by the HR department on organizational orientation through which HR tries to integrate the new resource with the existing ongoing business process with the intention of managing human resources efficiently so that they bring more values to organization. After the initial organizational orientation training, the employees are stationed in the right place according to the available vacancies in the organization and expected to be provided another crucial training which is called station straining which would be scheduled by the training manager of the organization. He will ensure of the employees’ competences on the particular work so that they perform better and supporting to run the business operation smoothly. Employee would be evaluated in the particular station training and expected to perform independently in their stations. They would be followed up time to time in managing their performance in a great level and motivated and rewarded occasionally.

What is training and its vital role in the organizational goal achievements?

There are different definitions provided on training, it is commonly understood that training is a systematic process through which an organization’s human resources gain knowledge and develop skills by the instruction and practical activities that result in improved corporate performance. 

Amstrong in his handbook of human resource management (2014, p.308) stated that training is defined to promote learning through the application of systematic and planned instruction activities. He also stated that systematic and planned instruction are to be used in promoting learning through training (2014, p.308). and also called that it is a learner-based training. The meanwhile Reynolds (2004: 45) noted that training plays a complementary role in accelerating the learning. The meanwhile However, Crossman (2004) noted that training and development could align the efforts with the organizational goals and the employee motivation and performance could be managed in order to obtain the improved performance and productivity. At the same time, Cole (2002, p.330) found out that training is connected with the learning activity for acquiring the specific knowledge and skills to carry out the task. The meanwhile Pynes (2008) noted that, through training and development programme knowledge, skills and attitudes of employees for the particular job is expected to be changed. 

Development through training:

According to Onasanya (2005) he noted that development is considered to provide training to a worker through a certain education for higher responsibilities. At the same time, Beardwell and Helen (2001) considered that development is complex and differentiated as a result of learning and maturation. The meanwhile Itika (2008) noted that development is the adaptable resources with variety of skills concerned with individual mix of skills, experiences so that the employees achieve their full potential.

In this respect, development is a future focus and aiming to prepare employees to take additional responsibilities in different jobs and expected to continue to grow in their workplace so that they retain for a long time in the process of value creation to organization. The most suitable and capable personalities should be provided opportunity to develop themselves by estabilishing a succession planning in the organization which would be an essential thing the HR department consider in the resource utilization in an organization.

Performance expected through training:

Garavan (1997) stated that there is a hard time for an employee who doesn’t have an early training which will affect the employee performance. At the same time Qureshi (2016) emphasized that employees sharpen their skills, change their attitudes and behaviors through the learning process and the knowledge gained increases their performance. 

According to Boudreau et al.,(2001) performance of the trained employees is better than the employees not trained. However, Armstrong and Baron (2006) pointed out that good employee performance is produces as a result of an organizational performance. The meanwhile, Mwita (2000) emphasized that the important building block of an organization is the employee performance which is the foundation for a good performance. Therefore, the organization must analyze this and connect with the goal achievement of an organization which plays multidimensional role in the organization. 

The Need of training:

Kapinga (2008) stated that the assessment of the current status of the organization is an essential beginning. Pynes (2008) stressed that training needs can be determined by many techniques. One is job analysis which should be done prior to need assessment in order to find out the knowledge, skills, abilities and other characters such as motivation essential to do the jobs effectively. In the meantime, Benabou (1996) concluded that improvement of the business results are to be connected with well-designed training programmes. As a result, return on investment is increased considerably.

Personal development plan is vital through training:

Amstrong’s handbook of human resource management (2014, p.308) stated that 

Personal development plan is implemented to review the performance and development individual basis with the support and encouragement of the managers. It is an action plan proposed to learn and develop oneself. The action plan preparation  is expected to align with the outcome and the learning objectives through setting up an internal resource centres, establish the support of mentors, guided reading system, formal training plan to develop knowledge and skills, establishing e-learning environment and the implementation of the action plan as planned.

The purpose of training and development programs: 

The main purpose of the training programme is to improve knowledge and skills in order to change attitudes and behaviours of employees to make the employees potential in the work. 

At the same time Adams (2002) states that training provides the opportunity for employees to have a feeling of becoming part of the family members of an organization and to create the sense of belongingness among other employees which will increase the professional development and skill development at work

Evaluating the learning process in Training: 

According to Amstrong’s handbook of human resource management (2014) Learning is to be evaluated.  It is essential to assess the effectiveness of the outcome produced through the specified activities where changes are anticipated and to make more effective the planned activity. As noted by Tamkin et al (2002), learning  is a chain of impact from planning the learning to meet both individual and organizational learning needs to bring behavioural changes to impact on others and as a whole in the organizational performance.

Responsibility of Managers in Learning & Development Process of the Employees: 

According to Amstrong’s handbook of human resource management (2014, p.314) Managers role is vital in making use of the employees in the involvement of self-directed or discretionary learning activities which should be assisted by the managers through facilitating the learning activities by organizing the induction training, coaching, mentoring, and implementing personal development plan and helping the employees in implementing the plans. Individual’s responsibilities are also expected more in self learning.

In Conclusion: 

An organization should pay special attention to its human resource development by providing essential training and provide development opportunities with the intention of empowering the existing human resources who would continue to retain in the workplace by creating more values to organization and assisting to reduce the cost of recruitment and assist to maintain employee retention of its valuable unique resources in facing the competitive business environment and achieve competitive advantage.

References:

Harrison, R. (2000), Employee Development, Beekman Publishing, Silver Lakes, Pretoria.

Armstrong, M. (2009). A handbook of human resource management practice. (11th ed.) Available at: https://www.pdfdrive.com/armstrongs-handbook-of-human-resource-management-practice-e57840149.html (Accessed: 22 December 2019).

Husys. (2018). Importance of Training & Development in Organizations. [online] husys.com. Available at: https://husys.com/blogs/importance-of-training-development-in-organizations/Paynes, E. Joan (2008). Human Resource Management for Public and Non – 

profit Organization, 3rd edition

Cole, G. A. (2002), Personnel and Human Resource Management, 5th ed. (Accessed: 22 December 2019)

Paynes, E. Joan (2008). Human Resource Management for Public and Non –

profit Organization, 3rd edition  (Accessed: 22 December 2019)

BEARDWELL & HELEN (2001) Human resource management: Macmillan Indian 

2001 274. Torrington (Accessed: 22 December 2019)

Kothari, C.R. (2003). Research and Methodology (Methods and Techniques), Second 

Revised Edition, New Age International (p) Limited Publisher, New Delhi, India. (Accessed: 22 December 2019)

Flynn, B.B., Schroeder, R.G., Sakakibara, S. 1995. “The impact of quality management practices on performance and competitive advantage”, Decision Sciences , Vol. 26 pp.659 -91(Accessed: 22 December 2019)

Guest, D. (1997), “Human resource management and performance: a review and research agenda”, International Journal of Human Resource Management, `Vol. 8 No. 3, pp. 263-76 (Accessed: 12 January 2020)

Harrison, R. (2000), Employee Development, Beekman Publishing, Silver Lakes, Pretoria. (Accessed: 12 January 2020)

Huselid, M.A. (1995), “The impact of human resource management practices on turnover, productivity and corporate financial performance”, Academy of Management Journal, Vol. 38 No. 3, pp. 635-72. (Accessed: 12 January 2020)

Paynes, E. Joan (2004). Human Resource Management for Public and Non –profit Organization, 2nd edition.(Accessed: 15 February 2020)

Paynes, E. Joan (2008). Human Resource Management for Public and Non –profit Organization, 3rd edition (Accessed: 15 February 2020)

LOGO

Introducing Talent Consultancy: Improving Organizational Performance Through Structure, Systems, and People

In today’s business environment, many organizations are working hard, but not all organizations are performing well. Employees are busy, departments are active, sales teams are pushing, and managers are making decisions every day. However, despite all this activity, some organizations still struggle with low profitability, high costs, operational confusion, employee performance issues, and customer dissatisfaction.

The problem in many organizations is not a lack of effort. The real problem is a lack of structure, systems, visibility, accountability, and operational control. This is where Talent Consultancy comes in.

Talent Consultancy was established with a clear purpose: to help organizations improve performance, efficiency, and profitability through better management systems, operational visibility, structured processes, and people development.

What Talent Consultancy Is Really About

Talent Consultancy is not just a training provider. It is a management consulting and corporate training organization focused on improving how businesses operate.

Many training programs give knowledge, but organizations do not change because knowledge alone does not improve performance. Performance improves when organizations implement:

  • Proper systems
  • Clear processes
  • Performance measurement
  • Accountability structures
  • Operational controls
  • Leadership and management development
  • Employee performance improvement programs

Talent Consultancy focuses on practical business improvement, not just theory.

The goal is simple:
Help organizations work better, perform better, and become more profitable.

The Main Areas Talent Consultancy Supports Organizations

Talent Consultancy supports organizations in several key business areas:

1. Leadership and Management Development

Many organizations promote employees to managerial positions, but they are not trained to manage people, performance, and operations. Talent Consultancy helps develop:

  • Leadership skills
  • Decision-making skills
  • Performance management
  • Team management
  • Problem-solving skills
  • Strategic thinking

Strong leadership improves the entire organization.

2. Human Resources Management

Employees are one of the most important assets in any organization, but without proper HR systems, organizations face:

  • High employee turnover
  • Low motivation
  • Poor performance
  • Attendance issues
  • Lack of training and development
  • Poor performance evaluation systems

Talent Consultancy helps organizations implement:

  • HR policies and procedures
  • Performance appraisal systems
  • KPI systems
  • Training and development programs
  • Employee engagement programs
  • Work-life balance initiatives

Good HR management improves employee performance and organizational stability.

3. Procurement, Logistics, and Supply Chain Management

In many organizations, a large portion of company expenses comes from:

  • Procurement
  • Inventory
  • Warehousing
  • Transportation
  • Distribution

If these areas are not managed properly, companies lose money through:

  • High purchase prices
  • Excess inventory
  • Inventory shortages
  • High transportation costs
  • Poor planning
  • Emergency purchasing
  • Wastage and damages

Talent Consultancy helps organizations improve:

  • Procurement systems
  • Supplier management
  • Inventory control
  • Warehouse operations
  • Logistics planning
  • Supply chain visibility
  • Cost reduction strategies

Improving supply chain operations can significantly improve profitability.

4. Sales, Customer Service, and Marketing Management

Organizations do not grow only by controlling costs; they also grow by:

  • Improving sales performance
  • Improving customer service
  • Building strong customer relationships
  • Improving marketing strategies
  • Increasing customer retention

Talent Consultancy provides training and consulting in:

  • Sales management
  • Customer service excellence
  • Client relationship management
  • Marketing management
  • Communication skills
  • Professional English for the workplace

Better customer service and sales management lead to business growth and customer loyalty.

5. Health, Safety, and Workplace Performance

Organizations must also ensure:

  • Safe working environments
  • Employee well-being
  • Work-life balance
  • Stress management
  • Workplace discipline
  • Productivity improvement

Talent Consultancy helps organizations improve workplace environment, employee well-being, and productivity through structured training and programs.

The Talent Consultancy Approach – The OTP Framework

One of the key concepts used by Talent Consultancy is the OTP Framework:

Operations → Transparency → Profit

This framework is based on a simple management philosophy:

If organizations can clearly see their operations (Visibility),
If people are responsible for performance (Accountability),
If processes are properly controlled (Control),
Then profit will improve naturally (Profit).

In simple words:

See it → Own it → Control it → Profit from it

This framework helps organizations:

  • Improve operational visibility
  • Build accountability systems
  • Implement operational controls
  • Improve efficiency
  • Reduce costs
  • Increase profitability
  • Improve overall organizational performance

This approach positions Talent Consultancy not only as a training provider but as a business performance improvement partner.

Who Talent Consultancy Works With

Talent Consultancy supports:

  • Small and medium businesses
  • Trading companies
  • Distribution companies
  • Logistics companies
  • Service organizations
  • Manufacturing companies
  • Corporate organizations
  • Training institutes
  • Entrepreneurs and business owners

Any organization that wants to:

  • Improve performance
  • Improve management systems
  • Reduce costs
  • Improve employee performance
  • Improve customer service
  • Improve operational efficiency
  • Increase profitability

can benefit from Talent Consultancy services.

The Vision of Talent Consultancy

The long-term vision of Talent Consultancy is to become a trusted business consulting and corporate training partner that helps organizations improve performance through:

  • Management development
  • Operational improvement
  • Supply chain and procurement improvement
  • HR and performance management systems
  • Customer service and sales improvement
  • Organizational structure and process improvement
  • Business performance consulting

The focus is not only training people, but improving organizations.

Final Message

Many organizations try to improve profit by increasing sales, hiring more people, or expanding operations. But real business improvement comes from better management, better systems, better processes, and better people performance.

This is the value that Talent Consultancy brings to organizations.

Talent Consultancy helps organizations:

  • Improve visibility
  • Build accountability
  • Implement control systems
  • Improve performance
  • Reduce costs
  • Increase efficiency
  • Improve customer satisfaction
  • Increase profitability

Because successful organizations are not successful by chance.
They are successful because they are well managed, well structured, and well controlled.

And that is exactly where Talent Consultancy creates value.

Profit-2.jpg

Pillar 4 – Profit: The Result of Visible, Accountable, and Controlled Operations

Many organizations believe profit comes mainly from increasing sales. Sales are important, but profit is not created only by selling more. Profit is created when an organization controls costs, improves efficiency, reduces waste, and manages operations properly.

This is why in the OTP Framework (Operations → Transparency → Profit), profit is the result of the first three pillars:

  1. Visibility
  2. Accountability
  3. Control

When these three are implemented properly, profit improves naturally and sustainably.

Profit is not just a financial number. Profit is a performance indicator that shows how well an organization is managed.

What Profit Really Means in Operations Management

In the OTP Framework, profit does not only mean accounting profit. It includes:

  • Cost reduction
  • Efficiency improvement
  • Better resource utilization
  • Waste reduction
  • Productivity improvement
  • Improved customer retention
  • Better pricing and purchasing decisions
  • Reduced operational risks
  • Better cash flow
  • Business growth

So profit is not only Revenue – Cost, but also how efficiently the organization operates.

A company with high sales but poor control may still have low profit.
A company with moderate sales but strong operational control may have high profit.

How the OTP Framework Leads to Profit

Let us connect all four pillars:

1. Visibility

You can see:

  • Where money is spent
  • Where delays occur
  • Where inventory is high or low
  • Which departments are efficient or inefficient
  • Which suppliers are expensive
  • Which customers are profitable

Visibility helps management understand the business clearly.

2. Accountability

Once visibility is established:

  • Responsibilities are clearly defined
  • Departments own their performance
  • KPIs are assigned
  • Employees become responsible for results
  • Performance is measured and reviewed

Accountability ensures people are responsible for performance.

3. Control

Once people are accountable:

  • Procedures are followed
  • Budgets are controlled
  • Approvals are structured
  • Risks are managed
  • Audits are conducted
  • Performance is monitored

Control ensures operations run efficiently and consistently.

4. Profit

When operations are visible, accountable, and controlled:

  • Costs reduce
  • Waste reduces
  • Productivity increases
  • Customer satisfaction improves
  • Cash flow improves
  • Business becomes scalable
  • Profit increases

So profit is not the starting point — it is the outcome of good management.

Simple Business Example

Let us consider a distribution company facing low profit.

After analysis, the company discovered:

  • Excess inventory in warehouse
  • Emergency purchasing at high prices
  • High transportation cost due to poor route planning
  • Overtime payments due to poor scheduling
  • Customer complaints and returns
  • No KPI system
  • No procurement approval system

The company did not increase sales immediately. Instead, they implemented the OTP approach:

Step 1 – Visibility

  • Inventory reports
  • Procurement spend analysis
  • Delivery performance reports
  • Cost reports
  • Department KPIs dashboard

Step 2 – Accountability

  • Warehouse manager responsible for inventory levels
  • Procurement manager responsible for purchase cost savings
  • Logistics manager responsible for delivery cost and time
  • Sales manager responsible for customer returns
  • Monthly KPI review meetings

Step 3 – Control

  • Procurement approval system
  • Reorder level system
  • Delivery route planning
  • Overtime approval control
  • Supplier price agreements
  • Inventory cycle counting
  • Budget control

Result (Profit Improvement)

  • Inventory reduced
  • Emergency purchases reduced
  • Transport cost reduced
  • Overtime reduced
  • Customer returns reduced
  • Overall operating cost reduced
  • Profit increased without increasing sales significantly

This is exactly how the OTP Framework improves business performance.

Profit Improvement Areas in Organizations

Organizations can improve profit through operational improvements in the following areas:

Procurement

  • Supplier negotiation
  • Contract purchasing
  • Spend analysis
  • Supplier performance management

Inventory

  • Reduce excess stock
  • Improve stock turnover
  • Reduce damages and expiry
  • Improve forecasting

Warehouse

  • Improve space utilization
  • Reduce handling time
  • Improve picking accuracy
  • Reduce labor cost

Logistics

  • Route optimization
  • Vehicle utilization
  • Delivery scheduling
  • Fuel cost control

Operations

  • Process improvement
  • Reduce rework and errors
  • Improve productivity
  • Reduce cycle time

Human Resources

  • Performance management
  • Productivity measurement
  • Training and development
  • Reduce employee turnover

Finance

  • Budget control
  • Cost analysis
  • Cash flow management
  • Profitability analysis by product/customer

Profit improvement is not one department’s job — it is the result of overall operational excellence.

Profit and Management Thinking

There are two types of organizations:

Organization Type 1 – Sales-Focused Only

They think:

  • Increase sales
  • Open more branches
  • Add more products
  • Hire more people

But they do not control:

  • Costs
  • Processes
  • Inventory
  • Procurement
  • Productivity

Result: Sales increase, but profit does not increase.

Organization Type 2 – Operations + Control Focused

They focus on:

  • Visibility
  • Accountability
  • Control
  • Efficiency
  • Cost management
  • Productivity
  • Process improvement

Result: Even with moderate sales, profit increases.

The second type follows the OTP Framework thinking.

OTP Framework Summary

The entire framework can be summarized like this:

PillarPurpose
VisibilitySee what is happening
AccountabilityDefine who is responsible
ControlEnsure processes are followed
ProfitResult of efficient operations

Control

Pillar 3 – Control: Turning Structure into Consistent Performance

Once an organization has visibility and accountability, the next critical step is control. Many organizations can see their problems and even know who is responsible, but still struggle with inefficiencies, errors, delays, and financial leakage. The reason is simple: they do not have strong operational control.

Control is the pillar that ensures that processes are followed correctly, standards are maintained, risks are managed, and operations run consistently. Without control, even a visible and accountable organization can lose money through mistakes, poor decisions, and inconsistent processes.

In the OTP Framework (Operations → Transparency → Profit), control is the pillar that stabilizes operations and protects profitability.

What Control Really Means

Control does not mean micromanagement or restricting employees.
Control means creating systems, procedures, checks, and standards that ensure work is done correctly, consistently, and efficiently.

In a controlled organization:

  • Processes are documented and standardized.
  • Approval limits and authorization levels are defined.
  • Budgets are monitored and controlled.
  • Procurement follows policies and supplier contracts.
  • Inventory movements are recorded and verified.
  • Performance is monitored through KPIs.
  • Risks are identified and managed.
  • Audits and reviews are conducted regularly.

Control ensures that operations do not depend on individuals, but on systems and processes.

What Happens When There Is No Control

Organizations without proper control often face:

  • Unauthorized purchases
  • Budget overruns
  • Inventory losses and damages
  • Duplicate payments
  • Fraud and financial leakage
  • Poor quality products or services
  • Missed deadlines
  • Inconsistent customer service
  • Operational inefficiencies
  • Compliance issues

These problems slowly reduce profitability, even if sales are increasing.

Many companies think increasing sales will solve their problems, but without control, increased sales can actually increase losses because inefficiencies grow with volume.

Business Example

Consider a company where procurement staff could place orders without proper approval. Over time:

  • Different departments purchased from different suppliers.
  • Prices varied significantly for the same items.
  • Some purchases exceeded budgets.
  • Duplicate orders were placed.
  • Finance struggled to control expenses.

The company introduced procurement controls:

  • Purchase requisition approval process
  • Approved supplier list
  • Price comparison requirement
  • Purchase order system
  • Budget approval limits
  • Monthly procurement reporting

Within a few months:

  • Unauthorized purchases stopped.
  • Supplier pricing improved through negotiation.
  • Spending was aligned with budgets.
  • Procurement costs reduced significantly.

The company did not reduce purchasing—it controlled purchasing, which improved profitability.

How Control Connects to the OTP Framework

The OTP Framework works as a sequence:

  1. Visibility – You can see what is happening.
  2. Accountability – You know who is responsible.
  3. Control – You ensure processes are followed correctly.
  4. Profit – Efficient and controlled operations increase profit.

Control is the pillar that converts visibility and accountability into consistent performance.

Without control:

  • People may know their responsibilities but follow different methods.
  • Spending may be visible but not controlled.
  • Processes may exist but not be followed.

Control ensures discipline in operations.

Where Organizations Need Control Most

Control should be implemented across key operational areas:

Procurement Control

  • Purchase approvals
  • Supplier selection procedures
  • Contract management
  • Budget control
  • Price comparison policies

Inventory Control

  • Stock movement authorization
  • Cycle counting and stock audits
  • Reorder level control
  • Expiry and damage monitoring

Warehouse Control

  • Goods receiving procedures
  • Picking and dispatch verification
  • Space allocation control
  • Safety procedures

Financial Control

  • Budget monitoring
  • Expense approval
  • Payment authorization
  • Cash flow monitoring

HR and Performance Control

  • Attendance monitoring
  • Performance appraisal
  • KPI tracking
  • Training and development tracking

Operational Process Control

  • Standard Operating Procedures (SOPs)
  • Approval workflows
  • Quality checks
  • Process audits

When these controls are implemented, organizations become stable, predictable, and efficient.

How to Build Control in an Organization

Organizations can strengthen control by implementing the following:

1. Develop Standard Operating Procedures (SOPs)

Document how each process should be performed.

2. Implement Approval Hierarchies

Define who can approve purchases, expenses, and decisions.

3. Establish Budget Controls

Monitor budget vs actual spending regularly.

4. Conduct Regular Audits

Audit procurement, inventory, finance, and operations.

5. Monitor KPIs

Performance indicators help control operational efficiency.

6. Use Systems and Automation

ERP systems, inventory systems, and dashboards improve control.

7. Implement Segregation of Duties

The same person should not request, approve, and receive the same purchase.

These controls reduce risk and improve efficiency.

Control Improves Organizational Stability

When control is implemented:

  • Processes become consistent.
  • Errors reduce.
  • Costs become predictable.
  • Risks reduce.
  • Employees follow standard procedures.
  • Managers spend less time fixing mistakes.
  • Operations become stable and efficient.

Control turns a business from people-dependent to system-dependent.
System-dependent organizations are more scalable, stable, and profitable.

Control and Profitability

Control has a direct impact on profit because it:

  • Prevents overspending
  • Reduces wastage
  • Prevents fraud and financial leakage
  • Improves efficiency
  • Ensures budget discipline
  • Improves productivity
  • Reduces operational risk
  • Improves quality and customer satisfaction

When costs are controlled and operations are efficient, profit increases even without increasing sales.

This is why in the OTP Framework:
Visibility → Accountability → Control → Profit

Control is the pillar that protects profit.

Final Thought

If visibility allows organizations to see operations, and accountability ensures people are responsible, control ensures that everything is done correctly, consistently, and efficiently.

Organizations without control are unstable.
Organizations with control are efficient, predictable, and profitable.

At Talent Consultancy, we help organizations design policies, procedures, approval systems, internal controls, and performance monitoring systems that ensure operational discipline and profitability.

Because when operations are visible, people are accountable, and processes are controlled, profit is no longer uncertain—it becomes the natural outcome of well-managed operations.

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Pillar 2 – Accountability: Turning Responsibility into Performance

Pillar 2 – Accountability: Turning Responsibility into Performance

In many organizations, work gets delayed, mistakes are repeated, and performance targets are missed—not because employees are incapable, but because accountability is unclear. Tasks are assigned, but ownership is vague. Decisions are made, but responsibility is shared by everyone and therefore owned by no one. Over time, this creates confusion, inefficiency, and poor performance.

This is why Accountability is the second pillar of the OTP Framework (Operations → Transparency → Profit). Once visibility is established and everyone can see what is happening in the organization, the next step is to ensure that someone is responsible for every task, every process, and every result.

Accountability transforms an organization from a group of people doing activities into a structured system where people are responsible for outcomes.

What Accountability Really Means

Accountability is not about blaming people for mistakes. It is about clarity of responsibility and ownership of results.

In an accountable organization:

  • Every process has an owner.
  • Every KPI has a responsible person.
  • Every task has a deadline and a person accountable.
  • Every decision can be traced to a responsible authority.
  • Performance is measured and reviewed regularly.

When accountability is clear, people work differently. They plan better, communicate better, and take ownership of their work because they know they are responsible for the outcome.

What Happens When There Is No Accountability

Organizations without accountability often face the following problems:

  • Tasks are delayed because everyone assumes someone else will do it.
  • Mistakes are repeated because no one is responsible for fixing them.
  • Managers spend time chasing updates instead of improving operations.
  • Employees focus on activities instead of results.
  • KPIs are not achieved because no one owns them.
  • Conflicts arise between departments due to unclear responsibilities.

Over time, this leads to low productivity, poor performance, and reduced profitability.

Many companies try to improve performance by introducing new systems or hiring more staff, but the real problem is often lack of accountability, not lack of resources.

Business Example

Consider a company where customer orders were frequently delayed. The sales team blamed the warehouse, the warehouse blamed procurement, and procurement blamed suppliers. Management could not identify the real problem because responsibility was unclear.

After analyzing the process, the company introduced an accountability structure:

  • Sales responsible for order accuracy.
  • Procurement responsible for material availability.
  • Warehouse responsible for picking and dispatch time.
  • Logistics responsible for delivery timeline.

They also introduced KPIs for each department and reviewed performance weekly. Within a few months:

  • Order delays reduced significantly.
  • Inter-department conflicts reduced.
  • Customer satisfaction improved.
  • Operational efficiency increased.

The improvement did not come from new technology or new employees.
It came from clear accountability.

How Accountability Connects to the OTP Framework

In the OTP Framework:

  • Visibility shows what is happening.
  • Accountability defines who is responsible.
  • Control ensures processes are followed correctly.
  • Profit is the result of efficient and controlled operations.

Without accountability, visibility alone does not improve performance.
You may see the problem, but if no one is responsible to fix it, nothing changes.

Accountability ensures that:

  • Procurement controls spending.
  • Inventory managers maintain stock accuracy.
  • Warehouse managers control space and movement.
  • Sales teams achieve revenue targets.
  • HR manages performance and attendance.
  • Finance controls budgets and cash flow.

When responsibility is clear, performance improves automatically.

How to Build Accountability in an Organization

Organizations can improve accountability by implementing a few practical steps:

1. Define Roles and Responsibilities Clearly

Each employee must know:

  • What they are responsible for
  • What decisions they can make
  • What results they are expected to deliver

Job descriptions should focus on outcomes, not just tasks.

2. Assign KPIs to Individuals, Not Just Departments

Departments do not perform—people perform.
Each KPI should have a person responsible.

For example:

  • Procurement cost reduction → Procurement Manager
  • Inventory accuracy → Inventory Controller
  • On-time delivery → Logistics Manager
  • Sales target → Sales Manager

3. Implement Regular Performance Reviews

Weekly or monthly reviews create responsibility and focus.
“What gets reviewed gets done.”

4. Link Performance to Rewards and Consequences

Accountability works when performance matters.
High performers should be rewarded, and poor performance should be addressed.

5. Use Reporting and Dashboards

Visibility supports accountability.
When performance is visible, responsibility becomes clear.

Accountability Improves Organizational Culture

One of the biggest benefits of accountability is cultural transformation.

In accountable organizations:

  • Employees take ownership.
  • Managers focus on improvement instead of chasing work.
  • Problems are solved faster.
  • Communication improves.
  • Performance improves.
  • Leadership becomes stronger.
  • Teams become result-oriented.

Accountability creates a performance culture, and performance culture leads to organizational success.

Accountability and Profitability

Many people think profit is only related to sales and costs, but in reality, profit is strongly linked to accountability.

When accountability improves:

  • Procurement reduces overspending.
  • Inventory reduces wastage and expiry.
  • Warehouse improves productivity.
  • Logistics reduces transportation cost.
  • Sales improves conversion and revenue.
  • Finance controls expenses and cash flow.
  • HR improves employee performance.

All these improvements directly impact profit.

This is why in the OTP Framework:
Visibility → Accountability → Control → Profit

Profit is not the first step.
Profit is the result of disciplined operations and accountable performance.

Final Thought

If visibility allows an organization to see problems, accountability ensures that someone is responsible for solving them. Without accountability, organizations remain busy but not productive, active but not efficient, and operational but not profitable.

Accountability turns activities into results, responsibility into performance, and operations into profit.

At Talent Consultancy, we help organizations design accountability structures, KPIs, reporting systems, and performance management frameworks that ensure every employee contributes to organizational success.

Because when people are accountable, performance improves.
When performance improves, operations become efficient.
And when operations are efficient, profit becomes the natural outcome.