Differences Between Authoritative And Democratic Management In Trump Organization And Apple Inc

Management frames: authoritative and democratic

Questions:

It is often believed that many companies are emphasizing on creating high performing teams to gain competitive advantage. Do you agree with this statement? Why? Why not? Use examples  from your organisation? 

In answering this question you are expected to define the relevant terms and definitions. Please include the following concepts in your answer: 

a. Recent popularity of teams; 

b. Types of teams and 

c. Creation of high performing teams.
 

The two types of management frames taken are authoritative and democratic. The authoritative frame of management is power-oriented, punitive and has controlling power with the management. They believe in imposing rules and regulations on the employees and treat the employees as subordinates to the top management authority. On the other hand, the democratic type of management is employee centred; believe in maintaining good relation with the employee and follow participative principle, in contrast to the directive principle of authoritative management. Further, the former is job centred and the later is employee centred. The former is concerned with the production of the company and the latter is concerned with the people of the company. Lastly, the former is task-oriented and the latter is relationship oriented (Drori et al.2013). In today’s changing trend of competition, market , customers, slowly and gradually the authoritative managing organization are changing them to democratic management system.

Trump organization is a real estate privately owned company of United States that follows authoritative management (Trump.com 2016).  On the other hand, Apple Inc. is multinational technology company of United States. The paper discusses the differences of both in operations (apple.com 2016)

In case of authoritative management, the top level employees treat the junior employees as subordinates and believe in imposition of rules and discipline. On the basis of that they formulate strategy. Strategies are generally formulated based on the environment of work and in the authoritative management the work environment is conservative and so the strategies are also formed without any integration with the employees. However, in democratic management, the top management believes in including the employees in the decision making and make them free to discuss their issues. Hence it leads to formulation of strategy integrating the employees. Integration of employees in strategy formulation helps in positive implementation of the strategies as the employees themselves are included in making the strategies so they cooperate full heartedly, in its successful implementation (Fleming and Spicer 2014).Strategic integration is a part of democratic management and the key to its success

The traditional managers generally follow their traditional style of operation like in Trump, an authoritative firm, whereas, the entreprens believes in implementing entrepreneurial management, like in Apple Inc. In the former case, the manager are suppose to check the work of the subordinates, like checking on staff time, monetary budgets, efficient level of inputs and others whereas, in the latter case, the entreprens prioritise the activities. They focus more on allocation of resources like time and money, purchase of effective services and expertise. The difference in their approach brings different results (Goetsch and Davis 2014). Both the approach is unique in its own way and also successful to their levels. However, chane become inevitable with changing environment.

Trump Organization and Apple Inc: a comparison

Doing business in multicultural market is a challenge for both the companies. The consumers taste, preferences and demand widely varies in multicultural market as it is influenced with their style of living, religion, eating habits and other factors. Trump being an authoritative firm tries to satisfy the market demand at its own level adopting different strategies but Apple Inc. first tries to understand the culture of the market and treat people individually with customised products and services. Understanding the culture of the market helps in penetrating the market better than being trying its own strategies without understanding the requirements (Nonaka et al.2014). An authoritative firm believes in making their own market strategies without doing sample study of the market which may bring failures sometimes

The difference in culture affects the management practices and their policies. In an authoritative management system, if there is difference in the culture of employees and market, their approach of dealing varies as compared to that in democratic management system. The former will not try to gel with the different culture people and will try to impose the company’s rule on them, whereas, the latter will try to make the place of work comfortable for the different cultural people so that they can work effectively and meet the activities of their task efficiently. The conservative style of authoritative management does not bring successful returns to the company in today’s global economy and the participative management style is more successful in meeting their goals (Roth 2014). The participative management tries to integrate through different culture and style of work which is inevitable in today’s global economy framework. 

Companies do create high performing team to meet the increasing challenges in the market, especially to gain competitive advantage against the competitors.  The Trump organization has formed organization work force where the team members together work under the guidance of the manager or leader to achieve a common goal of gaining competitive advantage in the market. On the other hand, In Apple Inc, self managed team are formed to meet the similar goals. In self managed team, there is no supervisor or leader and the team members are individually accountable for their performances and results of the task assigned. In self managed team, each member of the team id its own mentor and guide and is responsible of his or her performance and achieving the common goal. However, in Trump organization, the leader has the responsibility of the team performance and is accountable to the authority when the team performance is not good (Belbin 2012).

In every organization no one can work alone and team work is always required, be it authoritative or democratic management. Every employee has to be a part of the team and need to work in coordination with the team to achieve the common goals and to perform well. There are different types of team and can be formed anywhere irrespective of the type of management. They are permanent team, temporary team, task force, committee, organization work force; self managed teams, cross functional team and virtual team. In an authoritative management practice, the type of teams found is generally, organization work force, committee, permanent and temporary team. On the contrary, the type team formed are generally, self-managed team, virtual team and cross-functional team (Belbin 2012).

Impact of management style on strategy formulation and implementation

Apple Inc. team performance has given few leanings that must be followed to have high performing team. Firstly, one person should be in-charge of the project and should be accountable for delivering the work of the team. Secondly, the team must meet once in week to update each other about their output and task status. Third, the top level employees should work in team to have the similar teamwork at the bottom level. Otherwise, the team work filters as we move from top to bottom level of employees. Fourth, each member o the team must trust others and should share their problems openly so that solutions can be found and team performance can be enhanced. Fifth, the member of the team should be open to arguments and should not fear getting into conflict. The fear of conflicts damages the team performance and not the presence of conflicts. Sixth, the team member should be given some leverage to take decisions and every decision should not be subject to committee meetings. It makes the employees frustrated and they start delinking themselves from the company’s performance. Lastly, the team should work to achieve one goal and every member should be united in reaching the goal (Shafritz et al.2015).

The Apple Inc. being a democratic management system do follow the above mention criteria to increase the performance of the team. However, Trump organization being a authoritative management system does not believe in all the criteria and maintain control with the management for the team performances (Starr et al. 2016). 

There are several factors that motivate the investors to invest overseas besides the value of the currencies. In case of Malaysian investors, similar factors have played the role in increasing the investment in Cambodia. The factors are discussed below.

In Cambodia, the labour wages are low that reduces the cost of production for the organization. The government policy is liberal on business and has large consumer market. The country has always maintained good relation with the other countries and has entered a number of trading agreements like Association of South-East Asian nations (ASEAN), Asia Free Trade Area (AFTA), and China- ASEAN Free Trade Area (CAFTA). These trading agreements have made the country to have preferential access for a number of products to some of the world’s richest market (Tremblay 2012).

Cambodia has one of the most open economies of the world and has been ranked 35^th in terms of economic freedom by Heritage Foundation Index of Economic Freedom. The country has received the rank due to its positive policies towards labour market restrictions, trade policy, regulatory barriers and fiscal burden. However, the country do face economic hurdles in terms of limited infrastructure, poor health care, low government salaries and other problems faced by a less developed country. But in respect of doing business, the country has always supported the investors. The country has also topped the rank among other LDCs, in terms of market friendliness (Walker 2015).

The areas in which the country excels and has given easy access to business are tourism and agriculture. Country has liberalised its policy sufficiently for the foreign companies to invest in tourism industry which is a growing industry in the country and has enough potentiality for making profit. The visit of tourist is expected to cross 1 million mark in the next two years and hence demand high quality of facility for the tourist which is possible only through FDI flow. The government of Cambodia has provided built-operate-transfer schemes for the investors to attract them to invest in the country. Further, government has helped the MNCs to avail finance from International Finance Corporation (IFC), Asian Development Bank (ADB) and countries like Japan which act as a donor country for Cambodia (Tremblay 2012).

Agriculture sector also has lots of potentiality for foreign investment especially in agro-processing and organic farming. Government has provided the facility to the foreign companies to get into partnership with local farmers with 51% share of equity that has definitely attracted FDI in the country (Walker 2015).

Hence, though the value of dollar increases and investment becomes expensive, there are other factors that have encouraged Malaysian investors to invest in the Cambodia.  

References

Apple. 2016. Apple.

Belbin, R.M., 2012. Management teams. Routledge.

Belbin, R.M., 2012. Team roles at work. Routledge.

Drori, G.S., Höllerer, M.A. and Walgenbach, P. eds., 2013. Global themes and local variations in organization and management: perspectives on glocalization. Routledge.

Fleming, P. and Spicer, A., 2014. Power in management and organization science. The Academy of Management Annals, 8(1), pp.237-298.

Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence. pearson.

Nonaka, I., Chia, R., Holt, R. and Peltokorpi, V., 2014. Wisdom, management, and organization. Management Learning, 45(4), pp.365-376.

Roth, S., 2014. The multifunctional organization: Two cases for a critical update for research programs in management and organization. Tamara: Journal for Critical Organization Inquiry, 12(3), pp.37-54.

Shafritz, J., Ott, J. and Jang, Y., 2015. Classics of organization theory. Cengage Learning.

Starr, M.T., Spectra Logic Corporation, 2016. AUTHORITATIVE POWER MANAGEMENT. U.S. Patent 20,160,117,125.

Tremblay, D.G., 2012. Work–Family Balance: Is the Social Economy Sector More Supportive… and is this because of its More Democratic Management?. Review of Social Economy, 70(2), pp.200-232.