Bangladesh’s economy has experienced a steady growth of around 4-7% since independence. Most of the business activities were led by the private sector and government sector business activities shrieked over time.
As a result of its local private companies, as well as multi-national companies’ operations, expanded substantially. Now, there are thousands of local companies operating with more than BDT 1,000-3,000 million annual turnovers in Bangladesh.
Multinational companies for the nature of their corporate structure run their operations professionally with best management practices and as a result of this enjoy a better return on investment in comparison with local companies who are mostly traditionally managed companies.
Had local companies practiced corporate management and equipped local professionals to compete with multinationals the results could be the other way round as ground reality is in favor of local professionals.
So, let’s try to identify what are the things that are different in a professionally run company and a traditionally run company: –
- Benchmarking: What is not known can’t be managed. A professionally managed company has proper benchmarking across the value chain. This allows them to measure performance and improve by raising the bar above.
- Standard Operating Procedure (SOP): Think about Google Maps. How easy it has been to reach a destination and navigate across even to someone who reaches the first time in a country. This (SOP) acts as a guide and ensures it is understood by everyone in the same way and thereby assures consistency in process and results in the consistent product. It can also help to improve process and quality through some changes in the SOP.
- Organogram: A proper organizational hierarchy is an essence for optimum performance and all professionally managed companies have a proper organogram while traditionally managed companies don’t have a proper organogram.
- Explored and defined vision, mission, core values and long-term goals: Traditionally managed companies often lack the focus and fail to drive the team towards the desired organizational destination for not being methodological and agile built and exercised around proper vision, mission, core values and long-term goals.
- Right organizational culture: Having the right organizational culture and aligning all activities towards the core values is very important in setting the right set of mindset and practice across an organization and beyond; customers, vendors, institutions, regulators, etc. Perception about the organization and the goodwill of organizations are dependent on the culture.
- Proper strategic plan and KPIs (Key Performance Indicators): Traditionally run organizations lack having a strategic plan and performance indicators which not only reduces performance but also employee enthusiasm to strive for performance. Not to mention, designing an appropriate strategic plan requires competency, assessment, communication, leadership and support from top management. Like ERP project failure, strategic planning failure is also common in professionally managed companies for not having the right combinations to be successful.
- Fine-tuning strategic plans based on ground realities: Even a traditionally managed company has a strategic plan, the execution becomes difficult. Executing a strategic plan requires choices based on ground realities that require the authority to decide to bring the best outcome. But normally traditionally managed companies lack proper delegation of authority to make a decision that prevents making appropriate decisions and takes the planned or approved activity. However, proper execution even in professionally managed companies can be sub-optimal as it requires top to bottom support, integration, communication and leadership.
- Rewards for achievement: Traditionally managed companies lack appropriate tools to reward performance and as a result fail to appreciate for good performance. Rewarding for performance boosts employee morale and drives others positively across the organization for performance.