Critical Decisions For ERP Integration

Organizational behaviors

Discuss about the Critical Decisions for ERP Integration.

The most competitive advantage of a business largely depends on its possibility to benefit from innovation activities. Understanding a number of the internal and external factors that affect a business and its management is necessary to decide the innovation strategy that will eventually yield income for the organization. Business is an organization where an exchange of goods and services takes place for money or one another (Trkman, 2010). Business decision making is not just a one-time experiment; it is a continuous process that must be solved in harmony with the organization strategy. Critical organizational issues are usually accompanied by lots of business processes, business structure, and strategy. A critical business issue can be defined as a problem or opportunity which is critical to the general success of an organization. This paper aims at examining some of the critical issues that are related to business and management context, and to gain clarity of the contextual factors that affect an organizational business decision making.

Organizational behaviors define both the supervisory relationships, the structure of a business and workflow within the organization. The behaviors of an employee at work are different from their behaviors in a social setting or at home. There are certain factors that can motivate an employee or contribute to disengagement. These includes; culture, motivation, decision-making and change management (Ajmal, Martel & Kokale, 2010). When a new employee enters an organization, their behaviour will be determined by the organizational culture. People tend to fit in the environment around them since they are social beings. If an organizations’ culture encourages its employees to speak up without fear, then new employees will embrace this as well. While if an organization’s culture encourages the shoot the messenger trend, then it is clear that the employees will keep their opinions to themselves. 

Employees are mostly motivated when they can spot a clear distinction between the efforts that they put and the rewards they receive when they work hard. A salary should not be the only reason for an employee top show up at work (Klibi, Martel & Guitoni, 2010). Rewards must be available and should fair and equitable to ensure that the employees of the organization are inspired to work hard. Human beings make business decisions, whether at the organizational or individual levels. The organizations’ behaviour greatly informs the people’s decision making process. Businesses with excellent and good communication mechanisms make it easier for staff to make effective choices because well acquainted with the concepts of the business in question. All businesses should respond to dynamic markets, critical requirements and client demands if they must succeed. Businesses and companies can manage change effectively if they understand the organizational behaviour (Klibi, Martel & Guitoni, 2010). The need for change in an organization should be openly discussed; employees should be involved and given a chance to participate fully. Business managers should also adapt to the changes.

Both internal and external environmental factors influence business. The internal factors includes those factors which exist within the organizations’ premises. They affect the different operations that take place in the business. The internal factors include; a value system, mission and objectives, financial factors and internal relationship (Russo & Perrini, 2010). A value system is the culture and norms of a given organization; this is the regulatory system or framework of the business. Every employee and managers are required to act within the limits of this framework. The missions and objectives guide an organization’s different priorities, policies, and philosophies. Financial factors which come in forms of policies, financial status and capital structures also affects the performance and strategies of the business. Internal relationships refer to the support that the executive management is given by all the stakeholders of the business.

Environmental sources

Outside factors affecting a business can be further divided into micro and macro environment factors. The microenvironment factors include suppliers, competitors and marketing intermediaries. Suppliers are the people who have the responsibility of supplying the necessary inputs to an organization. The organizations’ management should keep a close look on the market come up with necessary strategies and policies that will enable them to face the competition they face from other organizations (Malhotra & Temponi, 2010). Marketing intermediaries help the organization in promoting, selling as well as distributing business goods and services to customers. This makes marketing intermediaries the only vital link between the business owners and consumers.

These macro environment factors include economic, social, political and technological factors. Economic factors that affect business are the economic conditions together with policies that contribute to the economic environment together. An example includes rate, inflation, and impeding trade practices. The social factors are the general society, together with the priorities s well as preferences which include educational background, people’s purchasing power, and consumption patterns (Zikmund, Babin, Carr & Griffin, 2013). The political factors are linked to business public affairs management and their impact on the organization. In order to maintain political stability in trade, it is important to maintain political stability. Recent technology helps improve the market attractiveness of a product hence making the commodity attractive to the end consumer. It is, therefore, important that a business keeps pace with the dynamic technologies to survive in the long run.

Organizations face all types of risks, some of these risks sometimes causes serious loss of profits others even leading to bankruptcy. Business is likely to face the following types of risks; strategic risks, risk of operation, risk of compliance, risks related to finances and reputational risks. Strategic risks are when the business strategy becomes less effective forcing the company to struggle to achieve its goals (George, McGahan & Prabhu, 2012). Strategic risk can be caused by technological changes, a strong new competitor, shifts in the customer demand, cost of raw material spikes, and any other large scale change. Compliance risks involve a business’ ability to comply with all the required laws and regulations that apply to business. New laws are implemented all the time. Hence there is always a risk that an organization is likely to face more regulations in the near future. When the business expands, they may find the need to comply with new rules that did not exist when the business was started.

Operational risk involves an unexpected failure in an organizations day to day operations. This could be a technical failure or could be caused by the employees, management or the processes of the company. Am operational risk could also be caused sometimes by events outside an organizations’ control, for example, a power cut, natural disaster, technical problems, etc. Financial risk refers to the finances flowing in and out of the organization, and the possible fact that a sudden financial loss could occur. Financial risk increases when a business engages in debts, especially if some of these debts are short term that is due in the near future (Sarkis, Zhu & Lai, 2011). In any business, reputation is everything. If a reputation of a business is damaged, an immediate loss is realized as most customers attracted to organizations with good reputations. Reputational risks come off major lawsuits, embarrassing product recall or negative publicity about an organizations’ staff or business itself.

Risk confronting the organization

Many legislations affect businesses by providing legal definitions, establishing operational and finance related codes that should be followed by business firms. These legal requirements come in forms of regulatory, labour, tax and reporting legislations. The laws and regulations have a direct impact on how business firms operate within particular business environments. These forms of regulations are formulated and implemented as codes and environmental rules and regulations. Labour laws refers to regulations that look into the manner in which employees are treated in an organization. These includes regulations such as minimum pay, protection of workers, and payment garnishment rules. Tax laws that a business should consider are following the principles of accounting. However, many are viewed as significant notable deviations, such as the schedules regulating depreciations that the government allows (Taricchi, Toneli & Cagnazzo, 2010). Finally, the laws and regulations of tax regulates the manner in which organizations present their financial reports

Organizational functions consist of a marketing department, Human Resources departments, and information technology departments. The organizational functions break the company’s works into different groups, forcing the individual’s group to accomplish their tasks or the whole organization suffers. Businesses can have different ways of dividing responsibilities and duties throughout the company (Doz, 2011). When each department completes their assigned task successfully, then everything runs smoothly. In a case where either an employee or a manager, fails to accomplish their task or delays to do so, there is a risk of not being able to deliver, hence pissing off customers and stakeholders, this will automatically result in the business realizing losses.

In business, it makes much sense when employees are satisfied with their work as well as workplace conditions. This includes balancing the needs and capacity of the organization to that of the employees. There are certain areas that an organization needs to consider to enable a positive work in the business entity (Al-Debei & Avison, 2010). These includes getting the basic conditions right, being a good communicator, having a positive management approach among others. Organizations who fail to set up good business practice may end up not running smoothly. Business owners should practice the art of engaging in meaningful dialogues, showing appreciation where necessary, listening to both customer and employees ideas and trusting team members as well.

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