Corporate Governance Issues & Challenges

Before we talk about creating an entrepreneurial culture in large organizations, we should first understand what we actually mean by a huge organization. Size is a relative term and we cannot practically quantify what all parameters make an organization larger. A Small Organization as the name suggests is miniature in size even though it may be under the age of the age of a high turnover. A slight organization has a smaller pool of employees and a smaller geographical presence. It may also have a lower number of hierarchies despite the fact that it may not have to be true. Yet all is not bed of roses for them. They do have some inherent drawbacks like relatively lesser shock absorbing capacity, higher dependence on individuals due to a smaller pool of manpower and lesser equipped to face the crisis.

An entrepreneur is someone who develops profitable situations in an enterprise by proactively identifying a change in the way things are to be done combining the available resources, taking action without fear of any boundary of the structure and with a vision that inspires the people around him.” Therefore, “entrepreneurship is creation or development of profitable situations in an enterprise by proactively identifying a change in the way things are to be done combining the available resources, taking action without fear of any boundary of the structure and with a vision that inspires the people.”

When we are talking about cost consciousness and individual profit centers we should be required to examine the performance of the service agencies present in the larger organization. These service agencies should need to be done to understand their true role in the organization i.e. they should be made aware that their existence solely depends on how efficiently they give their services to the shops. Shop heads should be given the discretion to outsource their jobs from agencies outside the plant rather than give them to service agencies if it is deemed to be more advantageous for his shop. This would also develop some competition in service agencies and. They would gear up for their survival.

One of the major problems that a larger organization faces is to make its employees aware about its visions and policies and also convince them about the same. Awareness about the organization’s visions and goals is of paramount importance for its employees because if they are ignorant of the organization’s visions they would act according to their own goals and targets and instead of working together to achieve a common target they would work in random directions with conflicting interests and ultimately leading to chaos.

To create awareness about company’s visions and policies up to the grass root level, people should be taken into confidence while fixing vision statements and goals. In a large organization, if this is not possible, the top management should involve at least the departmental heads. the departmental heads should in turn take feedbacks from their subordinates about their views and also fix the goals for their department inline with the organizations goals.

One of the major features of an entrepreneurial organization and major requisites for creating an entrepreneurial culture is considerable delegation of power. From our survey, we found that the delegation of power to the optimal level is not here. Workers feel bound and constrained by their limited powers and just have to wait for their senior’s approval even for taking minor decisions.

It is observed that seniors often feel angry and bypassed when their juniors take any step without taking them into confidence first. For this the responsibilities and powers of each executive should be fitted in black and white and they should be done accountable for their decisions. Senior officers should interfere in the working of his subordinates only when it is very necessary or when asked for it. Seniors should be kind of guiding figure than a dictator.

The environment of the organization should be made more open and people should be made to think they are important in order for the organization. This the view of the people should be heard with an open mind and major policy decisions should be taken after taking into confidence. One of the ways of achieving this is to get regular interaction of all levels of executives with the top management where they would have the freedom to give their views and suggestions. Conducting regular surveys of the staffs, analyzing the feedback and taking concrete action based on them, can also do this.

The organization should be made more flexible and market oriented and should be able to react to the challenges of the competitive and fast changing market scenario. For this people at the senior most level who formulates policies could be brought from outside. These people would have wider experience and would bring with them new energy, new vision and fresh way of doing anything.

Similarly the people from the organization should be given opportunity to go out and venture into new areas. Also the product mix of the company should be reviewed regularly and new products should be developed as per the needs of the market. This greater emphasis should be given on research and the organization should allocate a larger part of its budget to R&D activities.

The organization should also be more customers oriented, and should understand their value and do whatever possible to prevent them satisfied. This means creating a more customer friendly environment, which is possible only when all the employees are informed of the market needs and the feeling should be instilled in them that customers are their actual paymasters.

For this recurring workshops of all executives should be held where they would be apprised of the market condition and demands and what is expected of them to achieve the challenges. The management should be in a position to react to the changing market situation without being shackled by the long and bureaucratic decision-making process to complete. For this the organization should have a flatter structure and number of hierarchical levels should be reduced.

Upon the detailed analysis of constructive feedback received, interviewing some key persons and our own experience, we have come to a conclusion that the issue is very large and needs time for a very thorough analysis. However, we have been trying to come to the best possible conclusion with little knowledge and understanding that we have and feel will organization in creation of a culture of entrepreneurship. According to us, in general larger organizations do have difficulty in percolating the larger aim of the organization down every strata of management and workforce and the same is true.

The kind of non-clarity of vision and goals that afflict any size organization is also present here. People feel lost in the ocean of considerable manpower and this feeling needs to be addressed very urgently and effectively, as it is these very people who will bring in the desired change. The organizational structure of organization, according to us, needs a slight thinning and the appraisal system needs to be revamped.

An atmosphere needs to be created where people can be given enough freedom to act and draw motivation from those achievements, which have to be in conformity with organizational priorities. The organization needs to be more receptive to new ideas and flexible in its approach to meet the challenges emerging from fast changing market scenario. The workers are, by and large, motivated and dedicated to the organization. As suggested by us, the organization could do better if the people are rotated for cross-pollination of innovative ideas. It is true that cultural changes in any organization cannot be brought overnight but then it is also true that ‘well begun is half the job done’.

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