essay on business strategy and personality

8/9/2019 Essay on Business Strategy and Personality

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ORGANISATIONAL BEHAVIOUR

BUSINESS

STRATEGY AND

PERSONALITY

BY:-

VARUN PREET UPPAL

SECTION B

ROLL NO - 12110


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Essay on Business Strategy and Personality

This essay pertains to the Personality traits of individuals within an organization and the

interference of these traits with business decisions. Also we will look at how organizations as a

whole themselves portray a unique personality which again is a function of the man (not

sounding sexist) at the helm.

There are various examples around the world of CEOs who have either faltered because of their

over aggressive business strategies or have been ousted because of their mellow risk taking

ability. Therefore it is very important to find the right mix of personality traits as an individual

to appease the stakeholders and for sound decision making. Companies around the world have

pondered long and hard before theyve announced their CEO/MD positions. This is not meregimmick to build up hype but a lot goes into finding the right person for the job.

There are many ingredients to success, and one of the most obvious has always been an

outgoing, gregarious personality that lets fast risers stand out in a crowd of talent. But

successful introverts seem to have mastered the ability to act like extroverts. Some liken it to

an out-of-body experience that lets them watch themselves be temporarily unreserved. They

remain introverts to the core, and if they don't get down time alone or with family, they feel

their energy being sapped.

According to research introverts say they succeed because they have inner strength and think

before they act. When faced with difficult decisions, introverts worry little about what other

people will think of them. Jim Collins, in his 2001 bestseller Good to Great, was one of the first

to dispel conventional wisdom that successful leaders climb to the top because they're

naturally outgoing. He found that the most successful companies rarely had so-called celebrity

CEOs, but rather had CEOs who were self-effacing and humble to a fault. Charisma was a

handicap, he concluded. Thus we see that introvert characteristic is sometimes a boon as seen

in this case.

So how is all this related to business strategy? Well the answer lies in observation. We shallprove the point by asking questions about some top companies around the world. Why is Apple

so innovative? Why is Berkshire Hathaway/Infosys so reliable? Why is Kingfisher the king of

good times? The answer to the questions lies in the companys founding members. Apples

innovative traits are taken from Steve Jobs, Berkshire/Infosys from Warren Buffet/Narayan

Murthy, and Kingfisher from Vijay Mallaya. Thus we see an uncanny similarity in company traits

and company heads.


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Wall Street Journal came out with an interesting article on what does it take to jump from no 2

position in a company to the no 1 position bringing out certain hidden facts to the fore on how

companies are very choosy on who they want at the hot seat.

Why the gap between No. 1 and No. 2 in a company is often bigger than many realize. CEOs

not only perform different tasks from their second-in-commands -- who typically focus on

running operations -- but they have to act differently, too. That means the two roles often

demand very different personality traits, say people who have been there. CEOs talk about

getting acclimated to the limelight. Longtime chief operating officers say they are used to

working behind the scenes and submerging their egos. Their jobs focus them inward on the

company's problems, while CEOs spend much of their time convincing outsiders of the

company's strengths.

The very talents that make a great chief operating officer -- like finicky attention to detail --

can get in the way when you are in the top seat. CEOs are supposed to strategize, not

micromanage.

Even at a sub level, managers tend to be appointed at specific positions taking their

personality traits into account. Even groups within a project are formed on the basis of

personality traits to avoid internal conflict or panic decision making. Companies spend a huge

amount on human resource planning and they go every inch to make sure that right decisions

are taken at the right time and for that the right people with the right personality are at

important positions.


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Some of the techniques used by organizations to measure the influence of culture:-

Balanced Business Scorecard

Kaplan and Norton in their groundbreaking article in 1992 produced a Balanced Scorecard

approach that was very attractive in some ways. In their articles published by the Harvard

Business Review, and subsequent book they outlined a complex methodology that would

enable organizations to differentiate enablers from results. By moving away from focusing

entirely upon Financial Results (which are historical in nature and only reflect what has

happened) to a more strategic view, they are able to outline performance improvement along a

number of dimensions. Kaplan and Norton identified four major components of the Scorecard:

y Financialy Customery Internal processesy Learning & Growth

From Kaplan & Norton's work, others have contributed their views on the core components of

Scorecards. Some organizations have designed the Scorecard around only three variables

leaving learning and growth outside their model whilst others add components such as a strict

HR dimension thereby totaling five components on which to measure performance. Some

organizations use the Scorecard strictly as a forward planning tool prescribing a strong strategic

focus, and others apply it strictly for monitoring operational results. Other organizations have

decided the best way to introduce the tool is on a divisional or SBU focus concentrating upon

those areas and linkages which initiate and constantly interact with the customer, consumer orend user.

Initially, the purist approach focused upon clarifying strategic direction and defining measures

that fell outside the traditional financial analysis of the business. What is important here is the

Scorecard has to be fit for purpose. What is admirable about the research on the Scorecard was

that people were finally recognizing that the culture could have a direct impact upon results

and that by designing a culture that works and is self sustaining; it is possible to grow the

business along all dimensions noted above. However, there was also a movement underway to

create a Scorecard approach which would have instant feedback to the management group

about what was working and what was not hence the desire to overly bureaucratize the

Scorecard and automate it so that it is possible to track inputs and outputs as if one werenavigating a sophisticated flight deck with enablers and results available at the touch of a

button. Of course, it is possible to create this degree of control but this will only happen when

the simple stuff happens first.


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As a student of finance it becomes very important for me to understand how personality traits

affect financial decision making. We shall use quotes from articles to prove our point along the

way.

There are personality types and commentary as to how one's personality affects the money

decisions:

y The Innocent: this type tends to be most trusting because they generally don't seepeople or situations clearly, which leaves them open to bad decisions at vest and fraud

at worst.

y The Warrior: This person is seen as successful in the business/financial worlds and willlisten to advisors but make her or his own decisions.

y The Fool: these people are a combination of the innocent and the Warrior because theyhave no clue about what they're doing but they'll act fearlessly. They are financially

adventurous, and they act on impulse.

y The Tyrant: this type hoards money and uses it to manipulate others. They may haveeverything they need, but they're never comfortable with their lives because they fear

losing control.

y The Martyr: these people generally put other people before their own financial health.They use their money to rescue others based on their high expectations for themselves

and the people they're rescuing, but these decisions may be costly in the long run.

y The Creator/Artist: these people often have a love/hate relationship with money.They're constantly struggling to make their finances work, but they often feel that caring

about money means something bad.

y The Magician: Price defines the Magician as the ideal money type. They are aware oftheir circumstances and responsibilities and can see situations very clearly.

Thus we see how different personality types affect financial decision making and therefore

affect business strategies. There is a clear correlation between the two variables.


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Thus we have seen different aspects of personality traits influencing business decisions and

steps taken by companies to match the culture mismatch. This has played even greater role

today as the way companies do businesses around the world has changes post the 2008

recession. Risk taking abilities have reduced to an extent and companies are looking to

consolidate profits through cost cutting and innovation rather than exotic financial instruments.

Even at a sub levels teams are formed keeping in mind all these factors and effective training

given to managers to spot deviations. Thus in my view business strategy and personality play a

huge role in the companys future.

essay on business strategy and personality

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