Michael Hammer, a researcher at the prestigious Massachusetts Institute of Technology, is one of the leading world specialists in business management theory. As a teacher and researcher, he also works with management teams of several large global companies and helps them anticipate fundamental changes in their modes of operation.
It is the origin of the concepts of reengineering and "business process" that had a decisive impact on the evolution of social organization. In "Roadmap for managers" that was published and edited in 2002 by Laurent du Mesnil Maxima, he insists on the multiplicity of possible pathways of change and highlights the variety of improvements, which have demonstrated their effectiveness in the best-managed companies.
In the late 90s, all sectors were booming: customer expenditure and financial markets were constantly evolving. Following this period of expansion, a period of anxiety set in, businessmen and managers were rediscovering that execution plays an important role and that running a business has always been and remains one of the most complex human adventures, bearing the heaviest of risk and uncertainty. They now needed to identify new areas that needed them for the world in which they had formerly operated in had just undergone a major upheaval: the consumer of the 21st century has become more demanding and intelligent; this gave birth to the economics of demand.
But how has the client wrested control over everything?
Many reasons are leading this change:
-Scarcity gave way to abundance
-Technological advances have increased industrial productivity and therefore reduced costs
-Information Technology (including Internet) now allows the customer to find and analyze competitive products and thus make smart choices.
-The emergence of many interchangeable products that shortened the life cycle of products and hence companies are struggling to differentiate themselves.
All this happened in the 80s and early 90s to give birth to remarkably innovative new methods of management that have allowed companies to develop better products and services, making them more reliable and capable of offering lower costs. Thus, customers were getting better products at lower prices, workers enjoyed great job security and shareholders were reaping high profits.
In the economy of demand, innovations of yesterday and today basically becomes obsolete tomorrow, so only companies that aim to be the best and above all the others can expect to get by. For this, nine key points should be adopted by any entrepreneur in order to grow and prosper in an economy where customers make the law.
In an economy where it is the customer who rules the roost, being a good business partner is not an option but a vital necessity, a condition of survival that must focus around the customer demands.
First, when the customer needs information, it is essential to facilitate this task and enable cost and time saving.
Then, through market segmentation, any business partner is able to adjust his product or message to address the specific needs of different customer groups and in this way can anticipate their needs.
Tags: Michael Hammer's ‘Roadmap for managers', Management Theories, Constant Entrepreneurial Innovations
[...] Michael Hammer's guide for management MICHAEL HAMMER Summary of the book 1. Back to business 2. Manage your business to your customers 3. Make paste your offer to the real needs of the customer 4. Priority process 5. Bring order where chaos reigns 6. Develop an effective system of control 7. Déstructurez 8. Focus on the end customer 9. Remove borders that surround your business 10. Deploy your business 11. [...]
[...] In the past, small customers were powerless, against their suppliers they were forced to accommodate additional costs, delays and poor performance. Companies have realized that they need to get closer to their end customers for their loyalty, increase their purchases in volume and number of references to reap the comfortable margins with successive sales. During the last years of the 20th century, the term disintermediation whose definition is: get rid of intermediaries between the company and the client, so that the first can work directly with the second. This helps reduce costs, improve service and reduce inventory. [...]
[...] Until the mid-20th century, companies were organized into departments (one for production, one for logistics, one for finance, etc . ) but this division has lost its effectiveness due to a difficult management departments. Therefore, companies must change the organization by extending the activities of each department. The term profit center: This is a separate entity that provides certain products to certain customers and is independently managed by a Director General. It develops, manufactures and sells its own products and provides after-sales service with its own staff. The parent company brings capital and expects in return predetermined financial performance. [...]
[...] A multiplicity of programs show that management does not invest in a plan. The solution is to gather all efforts within a single theme uniting all these projects this must identify a carrier which managers and employees will appreciate. Attach importance to human problems: Business leaders consider the problems of people as secondary. They devote all their energy to develop plans that revolve solely around the real problems. The solution is to spend a third of the budget for staff. [...]
[...] VI Develop a real control system The control systems must be able to reveal the origin of performance deficits. But they have not evolved with the realities that companies face today and therefore intuition is not enough. Therefore, systems evaluation and measurement should be based on a thoughtful analysis of the company, linking its objectives and elements that can control the management and staff on the ground: that it takes to have a business model that links between what is essential and what is controllable and can balance them. [...]
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