2.1.2 Decision-making Levels
Company takes Shareholder Meeting, Board of Directors, General Manager hierarchical decision-making system.
Strategic decisions are decided by the Meeting of Shareholders, which has the highest authority. The strategic decisions are those that affect the general direction of the organization (Davis, D 2004, p.3). In YJB the strategic decisions include those, such as product of market development, investment decisions, etc.
Tactical decisions are mainly decided by the Board. The examples of tactical decision making in YanJing are those, such as budget allocations, personnel assignments, minor resource commitments, promotional mix decisions, and other short-term internal assignments.
Parts of the technical decisions are decided by the Deputy Managers. Technical decisions are routine in nature and deal with the control of specific tasks ((Davis, D 2004, p.4). This includes quality control, payroll, scheduling, and credit acceptance or rejection. Athough aspects can be decided by the deputy managers, the final decision is controlled by the Board ( General Manager).
- Decision-making Process
-
Problem recognition: The first step, the YJB decision-maker receive the problem from Subsidiary or departments, including production, sales, research and development. The recognition process begins when management acknowledges that some situation exists, or will exist, that needs to be acted upon in the near future.
-
Information search: An information search is the second major stage. YanJing Company use a combination of technologically sophisticated searches by experts and data collection strategies to help identify and solve problems.
-
Problem analysis: The Company holds a senior management meeting and invite outside experts to discuss the issues, to ensure the problem is thoroughly analyzed. SWOT Analysis (Strengths, Weakness, Opportunities、Threats) are usually used by the company, especially in the investment decisions.
-
Feasible evaluation. By using project selection models (Meredith & Mantel Jr, 2009, p.42) this allows the Company to make further assessments. The Criterion includes: investment risk, rate of return, consulting costs and acquisition times, etc.
-
Final decision. Through careful comparative study, from several options, the Board selects the most viable. However, typically, the final decision-making power remains in the hands of the Chairman ( General Manager).
2.2 Use of teams and groups
2.2.1 Rational division of labor
YJB Mainly takes three stages to achieve the rational division of labor:
- Pre-job training. This stage focuses on theoretical training. As part of the Corporate culture new staff must undertake three months professional training. The once they have pass the final examination, they are eligible for next phase.
- Practical tests. After passing the examination, the new staff progress into the operational phase. There is a three-months trial period. Only the new staff who meets job requirements, will ultimately be retained.
-
Job rotation. Every new staff member in the first year of work period must be tempered to different positions. In YJB, employees are mainly divided into five types: Production, sales, technitical, finance and administrative staff. By rotation. The company can ultimately achieve rational division according to each person expertise. However, the final decision is made by the General Manager Li Fucheng, other managers or low-level personnel have no authority to review, analyze, critique, and recommend courses of action.
- 2.2.2 Open discussion.
It is usually encouraged that employees actively provide suggestions through various channels, including written reports, direct mail or discussion with the Deputy Managers and any other forms. Moreover, the senior managers frequently come to the production line to listen to staff suggestions and give the feedback on deadlines.
To the rationalization proposals, YJB will not only adopt but also give awards to the provider. To some extent this reduces team conflict.
2.2.3 Motivation
-
Creating motivated work environment: In order to give employees a better working and living environment, the Trade Union usually books the Train tickets for employees to return home. Furthermore, in Women's Day, the trade union will purchase vouchers or well-being insurance, by which the employees’ belongingness is enhanced.
- Performance Award: The employees will be awarded because of high-performance or innovation in the work field. The incentive system includes: bonuses, travel or holidays, etc.
- Promotion：It establishes a reasonable promotion system. The staff, regardless of age, qualifications, or who have capacity and outstanding performance, can have the opportunity to be promoted. However, in fact, work experience is considered for promotion more rather than the individual capacity.
2.2.4 Training and development
-
Top-level training: Company develops and implements a human resources development plan, which includes promoting a number of ability and political integrity of the young top managers into key positions training each year. By doing this, YJB tries to setup a strategic reserve of talent, who understand business, and are good at management.
-
Low-level training. Staff training is regarded as the core links to improve employees overall quality. YJB invites experts and professors to hold specialized seminars for low-level managers each year; In addition, it organizes technical training for nearly a thousand employees on regular full-time, and selects technicians to advanced countries to study each year.
3 Discussions
3.1 Decision-making
Decision Making is important for organization long-term development. Efficient and effective decisions will ensure the company will perform well. Whereas, poor decision making significantly affects company productivity and profit (Sutcliffe & Mcnamaron, 2001, p.357). On the basis of the above analysis, the author learned the following aspects:
3.1.1Positive aspects
Generally speaking, YJB takes efficient and effective decisions, which ensure the company’s health and sustainable development.
The process of decision-making of YanJing is rational. It is consenus with the rational decision-making model (Robbins, Judge, Millett, Jones, 2010, p.95). As earlier mentioned, YJB’s decision process is broken down into a series of interrelated activities that leads to a choice among alternatives. Apparently, it is actually rational, Open, and transparent. Decision makers in YanJing make judgments that are logical and internally consistent with their goals and preferences. They select the alternative with the highest subjective expected utility, and they follow a systematic process from problem identification to implementation of the selected alternative ( Murray, Poole, Jones, 2006, p.164). In the author’s opinion, that is a main reason to explain why it is only been 30 years that YJB has spent to suppress the development history of other world beer enterprises with 100 years experience.
- Negative aspects
The power is highly centralized. YJB centralized decision making is in place, most important decisions are made at the top. Subsidiary managers have no authorization to decide the important aspects, regardless of the employees.
The reasons to produce this problem may be the Chinese traditional culture impact. Firstly, Culture difference is reflected in values, which in turn affect behavior, including the way in which decisions are made (Albaum, Yu, Wiese, Herche, Evangelista, Murphy, 2010, p.142). In China, Stemming largely from Confucian ethics, these values legitimate paternalism at the levels of family and organization, and patrimonialism at the state level, and provide a moral justification for hierarchy by stressing reciprocal vertical obligations (Child & Warner, 2002, p.30).
Secondly, Managerial behavior in modern China has been greatly influenced by political circumstance and the institutional regime. Initially, the PRC managed its labor using a ‘top-down’ model that endured for half a century ( Child & Warner, 2002, p.34-35). The firms tend to operate in a highly centralized manner, in which the entrepreneur-owners tend to maintain their authoritative position through keeping tight control in information and decision making.
However, such centralized decision making can stifle the creativity, and flexibility needed by the subsidiary (Luthans, & Davis, 1991, p.179). For example, in domestic situations, with the competition increasing, if the top managers do not decentralize authority and give the local managers greater decision-making power, this will increase the time needed in responding to competitive threats.
3.2 Use of teams and groups
Teamwork is the fuel that allows common people to attain uncommon results (Shelton et al., 2010, pp93-114). Effective and proper using of teams and groups will produce positive and satisfactory results (Gilley & Kerno, 2010, pp46-60). Learning from the above analysis, the author found the following aspects:
3.2.1 Positive aspects
The YanJing team is united and highly-efficient. The employees worked in YanJing are full of collaboration and master spirits.
As management scholars have stated: teams and groups can be the most rewarding ways of doing things. But at the other times teamwork can be frustrating, riddled with conflict and even counterproductive (Clegg, Kornberger, Pitsis, 2008, p.122). However, by taking some useful measures, which include Rational division of labor, Open discussion, Motivation and Training, YJB successfully reduces, even avoids groupthink, social loafing to create. These ways not only promote enterprise development which plays a certain role, it also greatly enhances employee sense of ownership. Moreover, it creates a warm, homelike atmosphere, establishes a high-performance working teams and forms a good corporate culture. This explains why YanJing will get success.
3.2.2 Negative aspects
Although, the way of using teams and groups is worthy to be recognized in YJB, there are still some insufficient aspects, such as “Lack of empowerment”, which needs to be improved for its long-term development.
Empowerment means helping to develop in others a sense of self-efficacy, self-determinism, personal control, meaning and trust (Carlopio & Andrewartha, 2008, p.428). To empower means to enable. It means to help people develop a sense of self-efficacy, or to feel successful or effective at a particular task (Geller, 2003). Accordingly, empowered employees are more productive, psychologically and physically healthy, proactive and innovative. They are higher morale and commitment than employees who are not empowered. While, without empowered, employees, organizations cannot adapt, survive or succeed in the long run.
However, there is less empowerment in YJB. The reason may also be connected with the different culture impact. Chinese culture has on a high level power distance (Jaw, Ling, Wang, Chang, 2006, p.128). Because of relatively high degree of rights, and there more strict hierarchy this distance between the powers of all levels is large, which the author have mentioned in Assignment 1. A large ‘power distance’ tends to be maintained between top managers and other members of the organization, with relatively little delegation of authority and a strong emphasis on vertical links within hierarchies (Child, J & Warner, M 2002, p.35).
4. Conclusion
In summary, after evaluating the practices in above two themes Decision Making and Use of teams and groups, it is found that both of them are useful to be in criticically analyzing and understanding the selected organization YJB. The two themes can help one understand the following three aspects:
- Finding the organization management deficiencies, which aspects need to be improved.
- Understanding the corporate culture and know that what factors that cause these problems.
-
Understanding the style of the organization management and whether it is suitable if considering the long term benefits to the company. If not, how to improve.
5 Recommendations & Implementation
Taking above analysis into consideration, the findings and discussion in this report support the following recommendations:
-
YJB should combine both centralized and decentralized decision making, a model like Japan (Luthans,F & Davis, k 1991, p.178). Top management still exercises a great deal of authority over what will be examined at the lower levels. However, working within this framework, lower level personnel have authority to review, analyze, critique, and recommend courses of action. The final decisions are made at the top level after elaborate examination of the proposal through successively higher levels in the management hierarchy, and results in acceptance or rejection of a decision only through consensus at echelon of the management structure.
- Within a reasonable range, it should give employees sufficient empowerment and delegation. For example, Managers can by breaking apart large tasks and giving employees only one part at a time. The manager watches for small successes achieved and then highlights and cilebrates achievements (French, Maule, Papamichail, 2009, p.410). Finally, the employees can generate a sense of movement, progress and success.
Reference
Albaum, G, Yu, J, Wiese, N, Herche, J, Evangelista, F, Murphy, B 2010, ‘Culture-Based Values and Management Style of Marketing Decision Makers in Six Western Pacific Rim Countries’, Journal of Global Marketing, vol.23, no.2, pp.139-151.
Carlopio, J & Andrewartha, G 2008, Developing Management Skills: A Comprehensive Guide For Leaders, PEARSON, Australia.
Child, J & Warner, M 2002, ‘Culture and Management in China’, in M Warner (ed.), Culture and Management in Asia, Routledge, Britain.
Clegg, S, Kornberger, M，Pitsis, T 2008, Managing & Organizations, SAGE，London.
Davis, D 2004, Business research for decision making, 6thedn, South-Western College, USA.
French, S, Maule, J, Papamichail, N 2009, Decision Behavior: Analysis and Support, CAMBRIDGE, New York.
Geller, E 2003, ‘People-based safety’, Professional Safety, vol.48, no.12, pp.33
Gilley, A & Kerno Jr., SJ 2010, ‘Groups, Teams, and Communities of Practice: A Comparison’, Advances in Developing Human Resources, vol.12, no.1, pp.46-60
Jaw, BS, Ling, YH, Wang , YP, Chang, ‘WC 2006’, The impact of culture on Chinese employees’ work values, pp128-144.
Li, FC, 2007, A Brief Introduction of YanJing Beer group, accessed 30/07/10
http:// yanjing.com.cn
Luthans, F & Davis, k (ed.) 1991, International Management, McGraw-Hill, USA.
Meredith, JR & Mantel Jr, SJ 2009, Project management, 7thedn, Wiley & Sons, USA.
Metcalfe, D 2003, Enterprise Visibility Makes Decisions Profitable, Cambridge, MA, Forrester Research.
Murray, P, Poole, D, Jones, G 2006, Contemporary Issues in Management and Organizational Behavior, THOMSON, Australia.
Robbins, SP, Judge, TA, Millett, B, Jones, M 2010, OB The Essentials, PEARSON, Australia.
Shelton, P, Alina, M & Makela, C2010, ‘Highly effective teams: A relational analysis of group potency and perceived organizational support’, Advances in developing human resources, vol.12, pp.93-114
Sutcliffe, KM, G Mcnamara 2001, ‘controlling decision-making practice in organization’, Organization Science, vol.12, no.4, pp.484-501.
Appendix:
The history of corporation( YJB) :
The YJB was established in 1993, but early in 1980 its brewery was founded. It elaborately creates its corporate culture by a long-term cultivation of the spirits of "being whole heartedly dedicated to work, starting an undertaking through hard labor, struggling against formidable tasks, working with the overall situation in mind in tandem with the colleagues, and sharing the worries of the enterprise as the enterprise owner". At present, it possesses tangible assets valued at 10.7 billion RMB Yuan and the capacity of the annual beer production has surpassed 3 million kiloliters. Which makes it rank at the first place in the output and production of beer nationally, and this position has been kept till today.
In the course of 30 years’ development, YanJing has taken the road of development by inner expanded and insisted on annual technology reconstruction. There is progress every year. And the development has undergone four stages:
1980-1988: complete the transformation from a small-scale brewery to a large-scale brewery;
1989-1993: complete the transformation to a large-scale brewery;
1994-1998: complete the transformation to a large-scale beer enterprise group;
1999 to now: increase over 300,000 tons each year; complete the transformation from a regional enterprise and brand in Beijing to a nationwide large-scale enterprise and nation-famous brand.
It is only 30 years that YJB has spent to suppress the development history of other world beer enterprises with 100 year!
