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Search Results for: job opportunities

What is the Scope of MBA after Engineering?

Last Updated on July 28, 2021 By Ramla Yasmeen 1 Comment

A large number of well-reputed universities receive hundreds of students’ applications for MBA after their Engineering degree on an annual basis. It has become a normal practice that B. E, B. Tech, B.C graduates shift their career to Management Sciences since a decade ago.

In today’s era, where competition for employment has been raised than ever, it’s perceived quite difficult to solely depend on one specialization. It is not only difficult for new grads to get hired quickly but also observed for experienced employees in their career path progression; soon they find it necessary to enroll in the MBA program.

Moreover, the transition of the modern corporate world is not willing to rely on only the traditional set of minds and skills.

MBA is a program where students find opportunities to learn a different aspect of businesses, economy, management, problem-solving, and analytical reasoning.

If an individual opts for an MBA, he will get a better scenario of what will be his/ her career path in the future instead of vague and uncertain information.

Whereas, engineering degree provides you knowledge about technical skills but lacks in organizational and management practices. Due to this, many engineering graduates will have confusion where their career path will lead them.

While selecting an engineering program, most students do not know their interests and future goals and when they join any organization it gets tough to adjust in the office environment. Sooner or later they have to enroll in an MBA degree or a Management course for a better understanding of organizational setup.  

Here you can read the scope or benefits of selecting an MBA after your engineering degree:

Sooner and better Job Opportunities

In the corporate sector, trends have been changed. Daily, the HR department receives the bulk of resumes for current and future vacant positions.

To stand out of crowd, technical and management degrees will build a good impression on a recruiter because there is more focus on multitasking, nowadays.

If you have an MBA along with your engineering degree, the recruiter will gain an idea that you can perform both the technical task and the management task.

In this way, you have a chance to meet person – job fit criteria. 

Career Advancement

It has been observed, an individual who has prior knowledge about the task and can deal under uncertain circumstances can be more confident and productive than a person who knows the task but is unable to deliver according to certain criteria and policies.

Thus, the MBA will make you one step superior to other ordinary individuals and you can easily move forward in your career ladder. Moreover, possessing two degrees opens the door to early promotions, get high paychecks and you can also easily enjoy the benefits of a managerial position.

Broader Career Options

In a business degree, up to date and a wide variety of subjects is offered, which is both general and specialized. These courses are related to each department found in an ideal organization such as Human Resource, Marketing, Finance, Project Management, IT, Personnel Manager, etc.

Thus, an MBA provides you a lot of options to widen your skyline and to move according to the changing dimensions of the world. You have multiple options if you want to enter the banking sector or can be hired as a financial analyst or can take HR as your career.

Better Interpersonal skills

An MBA degree holder knows the importance of interpersonal skills at an organizational level. He/ she will have a better understanding of how to interact, communicate and deal with different individuals of different personalities and mindsets. At the managerial or team level, a person having this skill will better know how to complete the specific task/ project efficiently.

Start your own Business

Yes, you’ve read this correctly. You can also start your own business with an innovative idea and become an entrepreneur. You can earn millions instead of working 9-6 for an employer.

MBA multiplies opportunities and success rates for you. If you have the expertise and have personal or acquired finance, you can easily start your venture and can multiply your profits.

In this way, you can be successful in making your position as a businessman in a corporate division. 

Transition in traditional thinking

MBA is a course with modern and innovative principles. It changes the typical thinking pattern of an ordinary person. During MBA, universities provide much exposure to students to visit different industries, solving case studies and arranging different events, and managing different projects in teams.

Students develop in themselves different soft skills and that is very important if you want to be successful. For instance, learning of different business software, leadership skills, stress handling, communication skills and so forth polish their personality. Students can utilize their thinking capabilities to be productive. 

Networking

Through MBA, you will get many chances to work with industry leaders, professionals, and innovators. With a better understanding of management subjects, you can create good relations with them and in other sense, you can craft your networks.

During your one career path, you want to switch your current company, then these networks or links can be utilized and you can work for them on better compensation packages, designations, and in better working environments. 

MBA saves your Career

During engineering degree, many students soon lose their interest because of trouble in understanding complex and dry subjects. After their degree completion, they remain unemployable.

Moreover, they also face a lack of engineering jobs in the market specifically in some countries or find irrelevant jobs or remain unemployed or leave jobs soon after their joining.

But the MBA can save them from entering and growing in a dry career which they don’t like. They can easily find any managerial job as these jobs are widely available.

Forecasting of Business Market Trend

MBA degree when coupled with experience, you will be able to analyze upcoming industrial moves or changing patterns which will be implemented at the organizational level later on.

So, this compels you to think in a broader aspect rather than gaining just a basic career position. This will make you a prominent, important, and valuable employee of an organization.

Do remember if engineering is a technical degree, then an MBA is a professional degree. Consulting career counselors may bring good outcomes. There is no harm to make a switch if the results are fruitful in the long run. But, before that, you must identify your interest and goals, anticipate if the change is obligatory, and then take a bigger move.  

Filed Under: Career

Is Food Sciences A Good Career? Here’s why and Why Not

Last Updated on March 8, 2022 By Ayesha Saeed Leave a Comment

If you are considering pursuing food science as your career, you need to know what your future prospects are as a food scientist. Food science as a career involves making food more nutritious, safe, and convenient.

It begins with an understanding of edible plants and animals and ends on understanding why people choose certain foods. But before that, you need to know if food science is a suitable career for you or not.

Here is a list of questions you must ask yourself before getting yourself enrolled in a food science degree program:

  • Do I love science?
  • Am I interested in Food preparation and production?
  • Do I give attention to minute details?
  • Am I good at communication?
  • Can I work with strict hygiene rules?
  • Am I confident enough to reinforce rules and regulations?

If the answer to most of these is in the affirmative, you have the potential to become a food scientist. In this course, you will learn all about food from different perspectives.

  • The physical characteristics of food and changes it undergoes through different processes
  • The chemical composition of foods and the factors affecting it
  • The microbiology of food
  • Nutrition
  • Food Safety
  • Food Preservation
  • Food Production

Career Options after Degree in Food Sciences

After completing your graduation in Food Sciences, you can work in the following capacities:

Nutritional Therapist

As a nutritional therapist, you know that most diseases are a result of a dietary and nutritional imbalance in a person’s life, therefore your approach will be holistic towards designing personalized nutrition and lifestyle plans for your client’s health and well-being.

Food Technologist

As a food technologist, your job is to assure those food products are produced, processed, and manufactured according to the standards of safety, quality, and hygiene.

Product/Process Development Scientist

As a product development scientist, your research will aid the manufacture of new products and improve existing ones. As a process development scientist, you’ll develop new processes to ensure the highest quality products.

Quality Control Manager

As a quality manager, you’ll have to ensure that the quality of your product not only meets the customer expectations but also complies with legal standards. It is your duty to develop and implement a quality management system for your organization.

In addition to that, there are certain other jobs where your degree would be useful. You may work as an animal nutritionist, regulatory affairs officer, scientific laboratory technician, research scientist, purchasing manager, production manager, or chef.

Food Science as a Career: Why and Why Not

Like every career food science also has its pros and cons. Every individual can judge by weighing the pros and cons for themselves. After reading this you’ll find it easier to decide if this is the right career for you.

Job Security

The food industry is the largest industry in the world which is growing day by day. If you are working, for example, with a food supply chain, you will always have numerous job opportunities at your hand.

Career Growth

Food companies are always hiring and creating positions, you can find countless jobs and careers as a food scientist.

Diverse Environment

If you become a food scientist, there are literally thousands of different jobs available for you. It opens a lot of opportunities for you such as in quality control, Research and Development, manufacturing, or teaching.

Salary Possibilities

Food scientists are often earning high salaries in Hawaii. The median salary for people with Food Science was $80,000. People who were in management positions made above six figures.

Food

If you are a food lover, you will definitely enjoy working in the food industry. You will discover new flavors, food combinations, and enjoy creating new products, testing them for quality, and doing research.

Travel Opportunities

If you like traveling you may find a job which gives you an opportunity to travel. Many multinational companies, international food chains, and airlines offer travel opportunities.

Certain aspects: may not like

Exposure to Hazards

Working in the food industry you may have to face certain biological and chemical hazards, including unpleasant conditions at cattle farms and processing plants.

Weight Gain

As a food scientist, you may have to check sample food every day, and if you’re a food lover you are likely to eat three times more than you’re supposed to eat.

Unethical Practices

Working in the food industry, you’ll learn about a lot of unethical business practices, lots and lots of food wasted on both producer’s and consumers’ end. Certain aspects of food such as organic, extra virgin are not regulated properly.

As a nutritionist, you know the adverse effects of processed foods but as food scientists, you need to work on their processing and marketing. As a food science student, you have to study a lot of science. If you aren’t a science person this field isn’t suitable for you.

Dirty Work

The experimenting and testing on rotten, molded, or fermented food can leave you disgusted.

Final Words

After weighing the advantages and disadvantages of selecting food science as a career, I must say that the pros of becoming a food scientist overweight the cons. But everyone can decide for themselves what appeals to them as their future career prospect.

Author Bio: Mrs. Bina Rehan writes about Diet, health, and nutrition. She is a qualified nutritionist. She designs customized diet plans and guides people about foods that will help them fight disease and stay healthy. She can be found on facebook.

Filed Under: Career

Joint Stock Company

Last Updated on December 19, 2022 By Lisa C. Townes 6 Comments

It is a popular type of business running across the globe under different territory-based rules and regulations. The driving factors of this business type are different characteristics, including its legal entity in the state, people’s trust, and many others. It is also a form of business like other businesses, including public limited companies, partnerships, and sole proprietorships.

A Joint Stock Company is a type of business that gives business ownership rights to shareholders by giving them a certificate of their shares. These shares can be bought or sold anytime from the people who already purchased them. There is unlimited liability of shareholders in the United States and Limited in Asian countries.

There are different types of joint-stock companies depending on their goal, design, their business model, their mission, vision, roles, and stakeholders. Each has its own advantages and disadvantage because of the many factors involved in different phases of the business cycle.

In Simpler words, a voluntary association made by different persons under state law for a specific reason is known as a Joint Stock Company. It started with the collection of initial investments by each member. This capital amount is divided into transferable shares with the liability of shares to their face value.

“A company is an artificial person created by law with a perpetual succession and a common seal.”

LORD JUSTICE LINDLEY

Companies are formed with legal ordinances under country law. There can be a minimum of 2 and maximum 50 numbers of shareholders in a Private limited company and a minimum of 7 to no maximum number of shareholders in a Public Limited Company.

The Board of directors are managers to operate its function under the law of the country – Different Nature of Company is the most popular business form for production and business on large scale. It has its own advantages & disadvantages.

Types of Joint Stock Company

types of joint stock company

1. Chartered Company

The company which is incorporated by the royal order is called a chartered company. Its power, rights, and functions are governed by the charter, issued at the time of formation. But this kind is not killed and formed in present days. Now all companies are registered under the company ordinance.

Examples

Chartered Mercantile Bank of India, Amsterdam Stock exchange, Chartered Bank of England, Muscovy Company.

2. Statutory Company

This company is formed by the order of the Governor-General President or Prime Minister or by a special act of the legislature. It is organized to carry on some business of national importance. The word “Limited” may not be used after the name of such a company. Each can exercise its particular power which is governed by the terms of its special Act.

3. Registered Company

It is incorporated under the company act. In our country, there is an ordinance in 1984 to form and supervise a registered company. It possesses a separate legal entity apart from its members.

Example

The registered company may be divided into the following groups
  • Unlimited company.
  • Company limited by guarantee
  • Company limited by Shares

3.1 Unlimited Company

The shareholders of the unlimited company are liable to pay the debts and other obligations of the business as in an ordinary partnership.

Features of Unlimited Joint Stock Company
  1. It is managed by the board of directions.
  2. It has a separate legal entity.
  3. There may be a large number of shareholders and
  4. Its shares may be transferred to another person.

But despite the foregoing characteristics, the public does not like to form this type of company.

3.2 Company Limited by Guarantee

Where each member gives a guarantee to contribute a specified amount to the company on its winding up, such a company is said to be limited by guarantee. It may or may not also have share capital. If such a company has a share capital, the amount must be mentioned in the charter of the company.

It is not formed to earn profit but the object of the company is to promote social, cultural, and scientific activities such as clubs, chambers of commerce, welfare, and educational association.

3.4 Company Limited by Shares

Where the liability of each member is limited to the nominal amount of the shares which he holds is called a company limited by shares. If he pays the value of the shares, his liability will be nil. It is popular among different types of joint stock companies. It may be classified into two groups

What is the difference between Public & Private Companies?
PUBLICPRIVATE
There is no restriction for the maximum number of members but the minimum number must be seven.There must be at least two members, but not more than fifty.
It can invite the public the subscription to its shares and debentures.It cannot invite the public for a subscription to any type of security.
Its shares can be transferred and disposed of to other persons without any restriction.Its members cannot transfer their shares to other persons.
Under section 174 the minimum number of directors is seven and the maximum number of directors can be appointed according to the provisions of its Articles of Association.Its shareholders may elect at least two directors and the maximum number of directors will be described by the Articles of Association.
There is a compulsion by law to file the prospectus or statement in lieu of the prospectus with the local registrar’s office.As it cannot issue the prospectus there is no restriction to submitting the prospectus to the registrar’s office.
It cannot obtain the certificate of commencement of business without fulfillment of the condition of minimum subscription.There are no restrictive provisions made in the company ordinance to fulfill the requirements of minimum subscription before its incorporation.
It has to hold a statutory meeting and it has to submit the statutory report to the registrar within the prescribed time.As it does not need to hold a statutory meeting there is no compulsion to submit the statutory report to the registrar’s office.
Every Public Company has to use the word Limited or “LTD” after its name.A private company has to mention the “Private” Limited as the last word under section [16 (a) (i)]
A public company cannot start its business after obtaining a certificate of incorporation.It can commence its business soon after receiving this certificate.
There is a compulsion to submit various reports, profit and loss accounts, Balance Sheets, and minutes to the registrar’s office.There are no restrictions for the submission of some reports to the registrar’s office.
Some reports and statements must be published for public inspection.There is no restriction for the publication of various statements for public inspection.
It must have to obtain this certificate for the commencement of business.There is no provision by law to receive this certificate for the commencement of business.
Its working field is vast. It can attract a huge amount of capital. So it is possible to conduct heavy and large scale business.Its capital and financial resources remain limited due to certain restrictions and hindrances so large-scale business cannot be arranged under this organization.
Public Company

To a company that is formed by at least seven members and there is no restriction i.e.

  • for transferring shares
  • for maximum numbers
  • for the subscription of shares and debentures is called a public company.

Under section 2 (30), “Public Company” means a company that is not a private company,

Private Company

The company is formed by at least two members and there are restrictions i.e. {Section 2 (28)}

  • for a maximum number of members (not more than fifty)
  • for transferring of shares

for the subscription of shares and debentures is known as a private company.

How do you Convert a Private Limited Company into a Public Limited Company?

There are several restrictions on Private companies which may result in limited financial resources, limited production activities, and limited technical and administrative abilities. Due to these factors, a business may not be expanded and the private company faces high cost per unit, limited sales, and low profit. These hindrances constrain the to decision the conversion of a private company into a public company.

To convert into a public company, it is necessary to alter the articles of association by a special resolution. The following alteration has to be brought in the provision of the Articles of Association.

  • Shareholders may transfer their shares.
  • They may invite the public for the subscription of shares and debentures.
  • A maximum number of shares i.e. fifty will be struck off from the Articles.

New Articles of Association will be submitted to the registrar’s office within two weeks of such alteration. The following necessary documents must be filed with the registrar’s office along with altered Articles of Association.

  • A list of persons containing their names addresses and other particulars who have agreed to act as directors.
  • The written consent of the directors.
  • Declaration of the directors to take up their qualification shares
  • Declaration of the directors that they have paid for their qualification shares or statement of the fact that they have already taken up and paid for their qualification shares.
  • A prospectus or statement in lieu of a prospectus.
  • A declaration from the directors or secretary or advocate that all the provisions of the Company ordinance have been fulfilled.

After submission of the foregoing documents to the registrar’s office Private Company may be converted into a Public Company.

Formation of the Company

The first stage in the formation of a company is that a few persons known as PROMOTERS get together to bring it into existence, to carry on a joint-stock business. They prepare certain necessary legal documents and take all steps necessary for the registration of the company. They convince responsible persons to act as the first directors of the company.

There must be a minimum of seven promoters in public companies and two promoters in private companies under the said ordinance. They have to prepare the following few documents which are to be filed with the Registrar of joint-stock companies of the province where the registered office of the company is to be situated; (Section 30)

formation of joint stock company
  • Memorandum of Association
  • Articles of Association: When a company adopts Table ‘A’ in its entirety, it need not file any special articles, but this fact must be endorsed on the Memorandum of Association. These documents require a prescribed stamp and are signed by at least seven persons in case of a public company and at least two in case of a private company
  • A statement showing the authorized or registered capital of the company
  • A list of persons who have agreed to act as first directors of the company
  • Their written consent to act as a director.
  • Notice of the situation of the registered office of the company (Section 142)
  • A written declaration by the directors to take up and pay for their qualification shares.
  • A statutory declaration that the requirements of the law for registration have been duly complied with

Difference Between Memorandum of Association and Articles of Association

Memorandum of AssociationArticles of Association
It is a fundamental charter of the company which defines its objects and power.It contains the rules and regulations for the internal management and administration of the company.
It is the nature of the contract between the company and the outside world i.e. debenture holders, bankers, creditors, etc.It does not create any type of contract but it establishes a relationship between the company and the inside persons.
It is the most important document of the company so it is called a primary document.Its importance is considered next to the memorandum so it is known as a secondary document of the company.
It contains the aims, objects, and conditions upon which the company is granted incorporation.It sets forth the provision by which the powers and aims described in the Memorandum are carried into effect.
It is compulsory for every company to have its Memorandum of Association. So it must be filed with the registrar’s office for its registration before the incorporation of the company.It may or may not be submitted to the registrar for its registration. A company limited by shares may be incorporated without the Articles of Association of their own. So Table “A” of the company’s ordinance will be considered its “Articles.”
It is regarded as an unalterable document. However, it may be amended by special resolution and with the sanction of the court or central government.Priority is not given by the Company ordinance to the Articles over Memorandum Association. In case of conflict with the Memorandum, the provisions of the Memorandum will be considered valid.
If there is any disagreement between Memorandum and Company Ordinance the provisions in the ordinance, will hold good.It is the subsidiary of the memorandum and it cannot contain any provision contrary to the clauses of the memorandum.
It defines the limit beyond which the company cannot operate. This limit must include the provision of the company ordinance.It contains the rules and regulations for the internal management and administration of the company.

Payment of the Requisite amount

The following payment would have also to be made to the Registrar:

  • The requisite amount of duty on share capital.
  • The prescribed amount of filing fees. This amount can be deposited into a government treasury.

Certificate of Incorporation

If the Registrar is satisfied that all legal formalities under the company’s ordinance have been complied with, he will issue a certificate of incorporation (Section 33). It means that (a) the company has been registered and the .liability of its member is limited (b) It has come into existence as a legal entity apart from its members.

A private company may start its business at once after obtaining this certificate. But the public company cannot commence its business without taking the following further steps.

Issue of Prospectus

The promoters have to issue a prospectus to invite the public to subscribe to its shares and debentures. A Private Company is not entitled to advertise this document. No prospectus may be issued unless a copy has been filed with the registrar. It must be signed by every person named in it as a director or his agent authorized in writing.

Allotment of Shares

When applications have been received from different persons, the directors will allot the shares to applicants. As the allotment is the acceptance of the offer of the applicant, and as such, constitutes a binding contract with the applicants.

Certificate of Commencement of Business

A public company may not commence its business unless the following documents are submitted to the registrar:-

Minimum Subscription

A statutory declaration on the prescribed form that the shares have been allotted to an amount not less in the whole than the minimum subscription.

Payment of Shares

Every director of the company has paid for the Company’s qualification shares.

Submission of Prospectus

The company has filed a prospectus or statement in lieu of a prospectus with the registrar.

Declaration Regarding condition

A statutory declaration by the secretary or one of the directors on the prescribed form that all. the conditions have complied with the company’s ordinance 1984.

After verifying these foregoing documents, the Registrar issues a certificate of commencement of business to the Public Company. Now this company is entitled to commence its business from the date of obtaining this certificate.

Why Joint Stock Company is Good? The most Amazing Advantages

Features & Advantages

FeaturesAdvantages
LiabilityLimited
CapitalHuge
ManagementExpert
LifeLongest
ObjectiveEarn Profit
OpportunitiesMore
ConfidenceMore
RiskLess
EntityLegal
TransferYes
PromotionYes
Business ExpansionYes
Loss RiskLess
Do Funds increaseYes
JobsMore
FlexibleYes
EconomiesLarge Scale
Economic ActivitiesIncreased
Bank LoansYes at Company Name
RolesNumerous
AgreementCan enter with your own name
Can change business natureYes
MembersMinimum 7 in Public Limited to no Maximum
and 2-50 in Private Limited

Limited Liability

The liability of each shareholder is limited to the unpaid value of the share holds. If he has already paid the total value of the shares, his liability will be nil. The private assets of the members are not liable to settle the business obligations. But in sole leadership and partnership, the private property of owners is also to pay the debts of the business.

Larger Capital

As there is no restriction for the maximum numbers in the public company, it can attract huge capital from thousand of persons of varying incomes. Thus the problems of deficiency of capital may not arise in this organizational structure.

Expert Management

Joint stock companies hire professional directors in many ways as well as service qualified technical and administrative abilities due to their sound financial sources. The management is generally conducted by expert and professional directors.

So, its sources can be utilized to the maximum for productive purposes. They overcome the depression phase of the business cycle with their experience to retain in the market.

Long Life (Perpetual Succession)

It normally possesses a perpetual life. The death of a director or member cannot affect the life of the joint stock company. it has a separate life apart from its members. On the other side, the biggest disadvantage of a partnership is that the death of any partner may dissolve the partnership.

Objective of Formation

The basic object of the formation of the joint-stock company is to earn profit. While profit is not distributed among the shareholders but some portion of the profit is transferred to the reserve fund. So that it may be used in the time of emergency.

Opportunity for Investment

As the company can divide its ownership into shares of a small denomination, it is possible. All groups of society invest their amount in a joint stock company.

Public Confidence

A joint stock company is created by law and is supervised by legal authority. So this form of business can easily win the public confidence and faith. This is no added advantage of a company that the public feels no chance of fraud or misrepresentation.

The major difference between a partnership and a company is Public has less confidence in one-man ownership and partnership.

Growth of Heavy and Risky Industry

The heavy and risky industry may be started only under this organization due to the following factors.

  • Limited liability.
  • Larger capital.
  • Better management and technical abilities.

Separate Legal Existence

It is created by law or by the particular Act of the company. it possesses separate legal existence apart from its members. So it can accept loans, hold property, make contracts,s and open bank accounts in its own name.

Transferability of Shares

The share of a public company may easily be transferred to another person and may be disposed of in the stock exchange market. So its members are ways in a position to withdraw their capital under its Acts.

Promotion of Thrift

The joint stock company provides opportunities for the general public the investment of their savings. So this tendency promotes the habits of savings and thrift among the public.

Expansion of Business

As it can attract a huge amount of capital from the issue of shares, debentures, and bonds, it is possible to increase its business activities for productive purposes. There is no limit to the maximum number of shareholders in the case of a public company, capital may be increased and large business may be commenced. But it is not possible in another form of the organization due to lack of capital.

Minimum Risk of Loss

There is a minimum chance of loss under this organization. If there is a loss it will be sustained by a large number of investors. So the hardship cannot be confined to a few hands as in the case of partnership.

Chances of Increasing Funds

A joint-stock company has wide power by law to raise its effective funds and capital by (a) sales of its debentures. (b) sale of its shares. (c) issue of secured and unsecured bonds ( In advanced counters) (d) Contracting loans on a mortgage of its assets.

Job Opportunity

The joint stock company provides job opportunities to millions of people working there in various industrial units.

Flexibility

As management of the company is conducted by a few persons known as the board of directors, they are in a position to bring new changes in the business. Capital sources and human abilities can be adjusted to the new situation. If the director is found indifferent in this respect he may be removed from his office.

Economies

It can enjoy the benefits and economy of large-scale production, management, and distribution. By introducing better methods of production they try to save or reduce unnecessary expenditures.

Growth of Economic activities

Joint stock companies increase the economic activities in the country. These provide the major source of revenue for the government. Industrial units produce goods at a large scale and thus provide the necessitates of life at a low price. so the healthy growth of joint stock companies may bring positive results in the economic structure of the country.

Loans at Company Name

The company can receive loans in its own name which are payable by the company itself. But in the partnership, the loans are obtained by the partners by their own names which creates various problems for them.

Roles

Its activities are controlled by many central or provincial departments. They are numerous rules which must have to be carried into effect by the company. It has to audit its account and submit various reports to Registrar’s office. It thus cannot operate freely without any interference.

Numbers of Members

There are large numbers of members in the joint stock company. In the case of a public company, the minimum number of members is seven and there is no restriction for the maximum number of members. In the case of a private company, the minimum number of members is two, and the maximum is fifty.

Agreements or Contracts

As a joint-stock company enjoys a separate existence it may enter into trade agreements in its own name.

Change the Nature of Business

In the partnership, the nature of the business may easily be changed with mutual consent from partners. But the object clause of the Memorandum of Association which also describes the nature of the business may not be changed except with the sanction of the court.

Why Joint Stock Company is Bad? 15+ Disadvantages

The Demerits

Why they are Bad?Disadvantages
Is formation Easy?Not really
Does it have high Expenses?Yes, it has more expenses
Who has control?Board of Directors
What is personal Interest in?Generally, it faces shortages
Does it have troubles?Yes it may
What about Responsibility?Everyone is, but no one
Is it monopolistic?Yes, after growth
Why there are conflicts?Because of personal Interest
What is its social role?It has many drawbacks
Is it corruption free?It depends
Who holds the income?It is in a few hands only
What are business Privacy Concerns?There are no business secrets

Complicated Formation

The process of the formation of all types is very complicated. It requires a long time and formalities. Like, Director’s appointment, There are many legal documents that must be prepared and submitted to the registrar’s office before its formation.

Operational Expenses

A joint stock company is a costly organization. Certain fees and other charges during the operation are paid to the government. Many people are engaged in various departments and heavy salaries are paid to them. So its financial source is utilized in unproductive sectors.

Concentration of Control

The management of the joint-stock company is concentrated in a few hands known as the board of directors. The shareholders who are the actual owners are not entitled to participate in the affairs of the company. So, they cannot know the internal activities of the directors who take undue benefits from their ignorance.

Limited Personal Interest

Its ownership belongs to thousands of persons who do not know each other. Secondly, business activities are conducted by paid persons who do not take an interest to create a direct relationship with the public. So, a business may suffer a loss due to the absence of personal relationships.

Promotion of Speculation

The price of the shares fluctuates on the stock exchange due to various factors. This promotes careless speculation in the country which results in trouble for the public.

Lack of Responsibility

Directors generally employ their friends and relatives on key jobs. But these persons are incompetent and inexperienced to conduct and follow the affairs of the business. So they cannot perform their professional duties with great responsibility.

Growth of Monopoly

The growth of joint-stock companies leads to a monopoly which is always against the public interest. It trees to have monopolistic control over the market. So this becomes the cause of the suffering of the people and the dissolution of the small firm.

Conflict of Interest

There are various groups in the joint stock company who have different voting rights, power, and share in the dividend. This disparity creates a conflict of interest between shareholders and management groups and among different types of shareholders which results in misunderstanding friction and exploitation of shareholders.

An Absence of Mutual Spirit

It is highly essential for the successful operation of the company that there must be a spirit of mutual help among the members. But this quality cannot be found in the company due to the transferability of shares.

Social Drawbacks

The following are the drawbacks of the growth of a joint-stock company:

  • Just the rate of wages is not paid to workers.
  • Working conditions are not improved.
  • Fringe benefits are not provided.
  • Human prestige is injured.
  • Devices of manipulation have been developed.
  • An unhealthy atmosphere within the industry has affected the health of employees.

So the foregoing defects have created great hatred and discrimination between employers and employees.

Corruption and Fraud

Some shrewd promoters present a very bright picture in the prospectus to attract capital from the public. Thus they deceive innocent investors for the accomplishment of their selfish ends. Moreover, big industrialists create corruption in the political life of the country.

Concentration of Wealth

After the introduction of the joint stock company, the combination of the various business units has been taking place to a great extent which causes the concentration of wealth into a few hands. It has split up society into two groups i.e. rich and poor. The rich have become richer and the poor have become poor.

Leakage of Secrecy

As there is a compulsion by law for a public company to publish its accounts and submit various reports to the registrar, secrecy cannot be maintained forever. Employees may leak out the secrecy of trade agreements, techniques or production, formula, and other necessary matters.

Bogus Report

Directors know the internal affairs of the company, but they do not present a true picture before the shareholders in their respective meetings. So interested parties may not know the actual performance of their business.

Lack of Freedom

There is much interference during the operation of the joint-stock company from various government authorities. There is also a compulsion by law to submit various reports to the registrar’s office. So this organization cannot perform its function freely.

Methods for Director’s Appointment

In a joint stock company, shareholders are owners of the company too. Each shareholder’s certificate is its ownership paper. This paper can be sold and bought in the market without disturbing all processes.

Selection by Promoters

The first directors of the company are selected by promoters. Their names are generally laid down in the articles of association. But their appointment cannot be valid unless they submit the following two declarations to the Registrar’s offices.

  1. Written consent to act as directors.
  2. An agreement in writing to take and pay for his qualification share

The foregoing provision does not apply to a private company.

Appointed by the Subscribers

If the articles are silent to describe the first directors of the company, the subscriber to the memorandum is to be deemed the first directors of the company and subsequent directors are to be elected by shareholders in the general meeting.

Elected by Members

The first directors of the company have to retire on the occasion of the first annual general meeting, so the necessary number of directors will be elected by members, in this meeting. Thereafter all such directors shall retire on the expiry of the term laid down in section 180 of the companies ordinance 1984.

Nomination by the Directors

Natural Appointment

A casual vacancy is caused by death disqualification or the resignation of directors. It may generally be filled up by the board of directors without the prior consent of the shareholders. Such directors will hold office for the remainder of the term of the director in whose place he is appointed under section 180 in the Companies Ordinance 1984.

Special Appointment

In addition to the directors elected or deemed to have been elected by shareholders a company may have directors or other special interests by virtue of contractual arrangements under section 182 in the Companies Ordinance 1984.

NUMBER OF DIRECTORS

In the case of a Public Company

There must be at least seven directors for the management of the company under section 174 of the Company Ordinance 1984. A maximum number of directors are appointed according to the provision of the Articles of Association. Under Section 177 all directors shall be liable to retire on the expiry of the term laid down in section 180.

In the case of a Private Company

Its shareholders may elect at least two directors and a maximum number of directors will be described by the Articles of Association. The provision of the retirement of directors does not apply to a private company.

Role or Position of Directors

The directors are representatives of the shareholders. He is one of those persons who is authorized to conduct the management of the company. The directors are collectively known as the “Board of Directors.” They frame policies and take decisions to realize the objectives of the company.

Directors have two positions in the Joint Stock Company

As an Agent

Directors are considered special agents of the company and not ordinary agents. The contract made by them will bind the company so long as they act within the scope of their authority. So they are not personally responsible for the contracts they made on behalf of the company. As agents, they have the authority to act in all matters but their powers are limited by the Articles of Association.

As Trustee

  • Directors are trustees for the company to some extent.
  • They are the powers placed in their hand to exercise them for the company’s benefit.
  • They are empowered to make calls, allot shares, to issue and forfeit shares.
  • They are trustees of the company but not individual shareholders or any third person.

The Circumstances cause Winding Up

Expiry of Fixed Period

Where the period is fixed for the duration of the company by the Articles, it. maybe winding up on the expiry of the period. But the company has to pass an ordinary resolution in general meetings to wind up.

Happening of Event

A company may be wound up on the happening of the event on which (under the Articles) the company is to be dissolved.

Special Resolution

A company may be wound up voluntarily if the company passes a special resolution for this purpose.

Heavy Liabilities

A company may be wound up if the company passes an extraordinary resolution that it cannot continue its business due to its heavy liabilities.

The Ways to Dissolve Company

methods to windup company

Statutory Report or Meeting: Procedure in Member’s Voluntary Winding Up

Where default is made in submitting the statutory report to the registrar’s office or in holding the statutory meeting within the prescribed time or any two consecutive annual general meetings under section 305 (b) in company ordinance 1984.

Statutory Declaration

The majority of directors make a statutory declaration of solvency for submission to the registrar intimating to him that have made a full inquiry into the company’s affairs, they are of the opinion that the company will be able to pay its debts in full within three years from the commencement f the winding-up,

Special / Ordinary Resolution

After the declaration of solvency has been submitted to the registrar, the company in general meeting passes the ordinary or special resolution as the case may be for the winding up of the company.

Appointment of Liquidator

The company in a general meeting appoints a liquidator to wind up the company’s affairs and distribute its assets. The remuneration of the liquidator may be fixed in this meeting. On the appointment of a liquidator, all the powers of directors and other officers end except so far as the company in its general meeting or the liquidator himself sanctions their continuance. Within ten days after the appointment of a liquidator, the notice regarding the appointment must be sent to the registrar.

Final Process of Winding Up

If the winding up continues for more than one year, the liquidator has to call a general meeting of the company at the end of each year. When the company’s affairs are fully wound up, he has to call the final meeting of the shareholders. At this meeting, the liquidator must submit a final account of the company’s affairs to the members. Within one week after the final meeting, the liquidator must file with the registrar a copy of the accounts and a return of the holding of the meeting. At the end of three months from the date of registration of return, the company is dissolved and its name is struck off the Register of Joint Stock Companies.

Inability to Pay Its Debts:
Creditors Voluntary Winding Up

Where the company is unable to pay its debts in the following situation. 

If a creditor whose debt exceeds $50,000 or one percent of its paid-up capital whichever is less under section 306

(a) Has served notice requiring payment and is not paid within 30 days.

If execution in favor of creditor remains unsatisfied or

If the court is fully satisfied that the company is quite unable to pay its debts.

The procedure for a creditor’s voluntary winding up is as follows:

Solvency Declaration

Statutory declaration regarding the solvency of the company is not necessary in case of the creditor’s voluntary winding up.

General Meeting

A general meeting of the company will be called for the purpose of passing the extraordinary resolution. This resolution is required for the winding up of the company because it cannot continue its business because of its liabilities.

Creditor’s Meeting

The company must call a meeting of the creditors on the same day or on the following day after the general meeting of the company. A notice must be sent in writing to each creditor for this purpose.

Statement of Company’s Position

The directors of the company must lay before the creditors a full statement of the company’s position, a list of creditors, and their estimated claims. A director of the company, appointed by other directors must preside at the creditor’s meeting.

Intimation to Registrar

The information regarding the notice of resolution passed must be sent to the registrar within ten days from the date of the creditor’s meeting.

Appointment of Liquidator

The creditors and the company at their respective meetings may nominate a person to act as liquidator. If different persons are nominated by creditors and companies respectively, the opinion of the creditors shall hold good.

Committee of Inspection

The creditors and the members at their respective meetings may appoint a committee of inspection consisting of five persons in each committee.

Liquidator’s Powers and Duties

The liquidator may exercise his power for the winding up of the company with the sanction of the committee of inspection or in the absence of a such committee, with the creditors.

Liquidator’s Remuneration

The liquidator’s remuneration is fixed by the committee of inspection or, if there is no such committee, by the creditors

After the Expiry of One Year

If winding up continues for more than one year, the liquidator must. call the meeting of .creditors and members at the end of each year. He must lay before the meeting an account of his acts for the winding up during the preceding year.

At the End of Winding Up

On completion of the winding up, the liquidators have to cal the final general meeting of the members and a meeting of creditors. The notice for these meetings must publish in the gazette and newspapers at least ten days before the meeting.

The liquidator has to lay out his reports regarding the accounts and assets of the company before the meeting. Within one week after the date of the meeting, the liquidator must submit to Registrar a copy of his accounts and a return of the holding of such meeting.

Dissolution of the Company

At the end of three months from the date of registration return, the company is dissolved and it ceases its legal entity.

Winding up a Joint Stock Company Under the Supervision of a Court

When the court is of the opinion that it is just and equitable that the company should be wound up due to its mismanagement, deadlock, fraud, or any other reasonable grounds.

Resolution

At first, the company has to pass special or extraordinary resolutions to wind up voluntarily.

Petition for Subject to Supervision

When there are frauds or irregularities in the voluntary winding up, the petition may be presented by one or more of the competent parties for winding up under the supervision of the court.

Supervision Order

If it thinks fit, the court may order that the voluntary winding up shall continue but subject to the supervision of the court and on such terms and conditions as the court thinks just.

Power of the Court

The court has the power to appoint an additional liquidator to remove any liquidator. But generally, the liquidator appointed by the company for the voluntary winding up continues in office subject to his giving of security.

Dissolution of the Company

When the supervision order is made, the liquidator may exercise all his powers in a voluntary winding up. On completion of the winding-up, the court will make an order that the company is dissolved.

Special Resolution

A Joint stock company may be wound up by the court if a special resolution is passed for this purpose.

Failure to Commence Business

When the company does not commence business within a year from its incorporation or suspends business for a year.

Reduction in the Number of Members

Where the number of members of a public company is reduced below seven or in the case of a private company below two.

Filed Under: Commerce

The Crucial Differences between a Growth and Fixed Mindset

Last Updated on May 31, 2023 By Jason Obrien Leave a Comment

Can our mindset change the course of our lives? Or should we only believe in fate and innate talent to sail us through a sea of opportunities?

People Have Two Kinds of Mindsets: A growth mindset and a fixed mindset. As the name suggests, a person with a growth mindset believes they can develop their capabilities and talents over time.

The Other Kind: The people with a fixed mindset believe talent and capabilities are innate. The difference is simple, but its implications on the person’s life are drastically different.

Here are the five crucial differences between a fixed and a growth mindset that can highlight why a growth mindset is the best:

Motivation vs Avoidance

Because a person with a growth mindset believes that talent and capabilities grow over time, they are self-motivated to perform on jobs.

They even take the initiative and ensure they put in all their effort to achieve their goals. They are not afraid of failure and are ready to accept challenges and perform even when there is a risk of loss.

On the other hand, a person with a fixed mindset tends to avoid challenges and doesn’t want to take risks because they fear failure. Because of this mindset, they are unable to accept challenges.

If you’ve seen the film ‘Yes Man,’ you’ll see how Jim Carrey’s character experiences changes in his life after he begins to say yes to every opportunity he gets. This is the main difference between a motivated and a resistant personality.

Effort vs Inertia

Because a person with a fixed mindset doesn’t believe in developing capabilities over time, they think practice and effort don’t matter. As a result, in the growth vs fixed mindset debate, the growth mindset will always win because they will try to polish their skills.

They will even be eager to learn new skills and implement these learnings in life. As a result, they will outperform those unwilling to make changes.

In the business world, if entrepreneurs don’t want to explore new opportunities because they believe their employees don’t have the skills they need, they will almost always fail. For example, in this era when companies are using Big Data to make crucial business decisions, companies are making big changes.

If a company hires new employees with data analytics skills but doesn’t invest in training them to use new tools, the employee skills will get rusty, and the competitor will beat them.

In 2023, there are multiple tools that data analysts can use to analyze data. In 2024, the number will be even greater. Some tools will become outdated, while others will get software updates.

Adaption vs Failure

When a person with a growth mindset fails, they are ready to reflect on their failure. They are willing to learn from their mistakes and improve their performance at the next opportunity they get. However, those with fixed mindsets are quick to give up. They treat temporary setbacks as failures.

In the business world, they will abandon ship completely if they aren’t achieving the small milestones leading to a greater goal.

business men shaking hands

On the other hand, people with a growth mindset will adapt to change the small milestones and, in the end, achieve the big victory because they are willing to progress, take charge of the situation, and have an open mindset.

One might even label them as positive and negative thinkers.

Inspiration vs Comparison

When people with a growth mindset see others succeed, they don’t get jealous. Instead, others’ success inspires them to change themselves and bring themselves to the desired level. A person with a fixed mindset believes that a successful person has innate qualities that result in their success. They demean the effort and struggle the other person might have had to go through to achieve what is only visible as the tip of the iceberg.

Because of their jealousy, people with a fixed mindset often see other people as a threat. So, they might even resort to means like devaluing their success or saying to them that their success results from their luck.

Feedback vs Criticism

Ever heard of constructive criticism? People who have a growth mindset can decipher constructive criticism as feedback. They are also willing to improve on these rather than just giving up. But it is easier said than done.

Many of us resort to being fixed thinkers when we receive feedback. This is because we believe we put in the maximum effort possible and didn’t achieve the desired results. Often, if the way that the other person communicates the feedback is negative, we tend to think that the fault lies in our innate abilities.

A fixed thinker also takes well-communicated feedback as a personal attack. They believe that they cannot put in more effort.

This close mindset doesn’t allow them to think outside the box. Additionally, they don’t believe multiple ways to achieve a goal exist.

And because they don’t believe they can improve their capabilities, they can even resort to unfair means to achieve a goal. For example, at a job, a fixed thinker could present another person’s efforts and ideas as their own because they don’t believe they can do it themselves.

Shifting from a Fixed Mindset to a Growth Mindset?

If you believe you cannot shift to a growth mindset, you are someone with a fixed mindset. Even if you are, believing in yourself and your capabilities is important. No human was born with the ability to walk and speak.

Eventually, we learned how to do it. Similarly, ten years ago, we wouldn’t have been able to do the tasks we can now. So, scientifically, our brains are always growing, whether we believe it or not. But we might as well accept it; after all, it will yield many benefits and more opportunities for us in the future.

If you’re an entrepreneur, allow employee mistakes, but never discourage them from trying. Often, small businesses do not have the budget to allot mistakes. However, if one considers money as an investment and not as guaranteed success, they’ll make it big in the future.

Final Words

People with a fixed mindset don’t give due credit to practice, effort, and learning. As a result, they don’t achieve their goals and work on the opportunities that would give them success.

This article presents a different view on the differences between the two mindsets. It isn’t just belief in learning vs. belief in innate qualities. The implications of this mindset go beyond these few words.

We hope you learned something from this article. If you think we missed something, let us know in the comments below.

Filed Under: Career

Build Your Wealth in 5 Steps

Last Updated on May 8, 2023 By Jason Obrien Leave a Comment

Building wealth is a challenging but rewarding pursuit. Almost anyone can amass wealth through their own efforts. It’s time for people to look for ways to level up their financial position. Fortunately, this article teaches you how.

Start within Yourself

Becoming wealthy is a serious decision that requires your total commitment. It would help if you changed your mindset first. To do this, you must practice self-education focusing on financial literacy.

These are the following tips to do this:

  • Read financial literacy books
  • Listen to podcasts
  • Take financial courses
  • Follow reputable financial-related blogs of investors and financial advisors

These tips are only a few. Explore other options to learn something new. Remember: To achieve financial success, you must always continue learning. Invest your time in your financial education. Soon enough, everything will pay off.

Generate Income

Generating a steady income is a critical first step towards building wealth. While there are many ways to generate income, having a job provides a reliable source of income and opportunities for growth. To find a good job, you can search for job openings online, network with people in your field, or seek assistance from job placement agencies.

If you have the financial capital, you can start a small business instead. If it becomes successful, it may be one of the 3 fastest ways to get rich. Start something that you’re passionate about. Let’s say you like cooking. Then, you can open a small restaurant and work your way from there.

Moreover, if you have other talents, turn these talents and skills of yours into excellent opportunities to earn more money. You can look for lucrative side hustles online. You can try the following part-time jobs:

  • Virtual assistant work
  • Freelance writing
  • Tutoring
  • Coding

These listed sidelines are only a few. You can choose from other income-generating ideas. You only need to ensure that you love what you’re doing.

Create a Budget

Once you have figured out how to earn more money, it’s time for you to craft a plan on how to manage your hard-earned income. Budgeting is essential for your wealth-building strategy. It helps you to take control of your money and avoid overspending.

To create a budget, you can use the most used technique known as the 50/30/20 rule. In this rule, you must allocate 50% of your money to all your essentials, such as rent and food. The 30% will be for non-essential things such as traveling and eating out with your family. The remaining 20% should be intended for your debt and savings. It may help if you always refresh your budget plan every month.

Pay off Your Debt

According to The National Study of Millionaires, millionaires study how to live below their means to avoid debt. This clearly shows that avoiding and/or paying off debt increases your chances of focusing more on saving your money.

If you are struggling with debt, it’s important to prioritize paying off high-interest debt first. One way to accomplish this is by using the debt snowball or debt avalanche method.

With the snowball method, you start by paying off your smallest debt first, while with the avalanche method, you prioritize the debt with the highest interest rate. By making a plan and staying committed to paying off your debt, you can put yourself on the path to financial freedom and wealth.

man hand holding coin and save money

Save and Invest

Saving money is a critical aspect of building wealth. One effective strategy for saving money is to pay yourself first. This means prioritizing saving before paying bills or debt. To make this easier, set up an automatic transfer from your checking account to your savings account. By doing so, you’ll ensure that a portion of your income is allocated towards savings each month.

Having an emergency fund is also best to avoid borrowing money in emergencies. Aside from this, once you have enough money, you can now put it into an investment. According to statistics, millionaires practice consistent investing. Therefore, to become one of them, it’s a good idea to invest 15% or more of your salary into different available investments, including real estate, stocks, and bonds. When making investments, ensure that you have a diversified portfolio.

Conclusion

Building wealth requires commitment and dedication, but by following the steps outlined above, you can set yourself on the path towards financial success. All this may not be easy, but once you have adequate financial education and do everything right, you’ll be on your way toward financial success.

Filed Under: Investment & Money

Advantages and Disadvantages of Line and Staff Organization

Last Updated on February 10, 2023 By Methew Harbor Leave a Comment

All organizations follow specific organizational structures to run the company smoothly. Each organizational structure has its specific characteristics. You may choose the one that suits your company’s needs the best. For example, the functional structure provides all authority to the manager. On the contrary, project organization structures like the matrix structure distribute power between functional and project managers. The hierarchy is different in each of them. Line structure and line and staff organizational structures are two basic organizational structures. Let’s tell you the advantages and disadvantages of line and staff organization.

What is a Line Organization System?

Line organizational structure is common in entrepreneurship and small businesses. It gives complete control to the top hierarchy, exhibiting authoritative leadership. For example, the owner of a small business acts as the leader or manager of inline systems. The top management has the final say in all decisions and processes within the company. It does not involve a large number of people.

What is Line and Staff Organizational Structure?

Line and staff organization is a little more complicated than the line system. Besides the straightforward organization system, it also involves staff of different departments. Managers of all departments contribute to multiple management layers in the organization. Line and staff structure is adapted by medium to large organizations with several employees. The line officers and staff officers perform their specific functions to contribute to the overall operation.

Line and Staff Authority Structure

Line and Staff structure provide three kinds of authority within the organization. The leaders follow the line, staff, and functional authority. Here’s a breakdown of the power in each.

Line Authority

Line authority means giving the person a particular amount of control for specific tasks. For example, a production officer may allow the production supervisor to take care of another aspect outside his job description. This kind of authority flows down the line. However, authority does not always translate to effectiveness. Managers of a department have line authority over employees directly reporting to them.

Staff Authority

Staff authority refers to advising the people with line authority for better results. It means the staff authority may work to facilitate the process in line control. For example, quality control officers may guide the production department in improving the stability of the product.

Functional Authority

Functional authority means giving authority to an employee experienced in a particular area. You may say that it is limited line authority. Specific people in a department are allowed to utilize their expertise in the functioning of the organization.

Advantages of Line and Staff Organization

People putting their hands together

Specialization

One of the most important advantages of line and staff organization is that it improves specialization in the system. Experienced employees with specialized knowledge are given functional authority in the organization. Line organization enables the staff to work more toward the execution of tasks.

Discipline

The clarity of authority and tasks within the company introduces discipline. The staff personnel does not supervise the line officers. Line personnel command the workers and give feedback. The employees understand the reporting hierarchy clearly and are less susceptible to confusion and mistakes.

Quick Decisions

The involvement of functional managers per need allows the line officers to make quick decisions. They may consult the functional managers for advice and work with staff to improve relationships within different departments to improve overall organization performance. It reduces the time taken for multiple approvals.

Better Coordination

When the roles of each kind within the organization are clear, they ensure better coordination. Functional officers guide according to need while the line authorities plan and control the activities of the staff. It improves different coordinations among all employees and personnel. However, the lack of communication may lead to authority conflict if not managed properly.

Convenience of Expansion

Having a three-way authority system in the company facilitates expansion and growth. Specialized employees help the line staff in processes by offering expert advice. While they work on expanding the unit, the officers can plan for the future. Some assistants or new officers may be appointed to expand and delegate tasks.

Better Utilization of Resources

Understanding the difference in the role of staff and line functions makes the best use of the workforce within the organization. The line and staff officers perform their functions smoothly through better coordination and cooperation. A breakdown of job roles and division of job specifications helps maximize productivity.

Practicality

Every organization needs to make practical decisions timely for progress and success. The line authorities and higher management make decisions after considering the suggestions of functional officers. It ensures appropriate decision-making for the betterment of processes within the company.

More Flexible

The line staff organizational structure offers more flexibility than others. Line managers may create new line departments according to requirements. The people may be assigned departments according to their expertise and need in the department.

Reduced Burden

Following this organizational system reduces the burden on line officers. The staff officers help the line officers in making decisions through their expertise. The line officers only have to perform the routine work and leave the rest to staff officers. It allows them to look for plans for the growth of the company.

Personal Development

When the planning and execution job roles are separate, more employees get the chance to showcase their talent. They may move higher in the hierarchy by correctly implementing their skills in the processes. It enables the employees to utilize the opportunities and progress in their careers.

Disadvantages of Line and Staff Organization

Poor Coordination

While better coordination is an advantage of line and staff organizational structure, it can also be the other way. Often the managers are not able to communicate the job roles to the employees. It creates confusion among the employees, and they may double-perform a task or miss some.

Ignored Advice

Unlike affiliative leadership structures, such organizational structures do not heed the officers’ advice. Staff officers do not have the authority to implement their opinions and recommendations without the line officer’s approval. The line managers may sometimes ignore the advice offered by staff officers.

Authority Conflict

Authority conflict is a common issue in organizational structures with multiple command officers like matrix and line and staff structures. The improper distribution of authority and responsibility can create problems within the organization. This can lead to an increased load on the top management to solve these conflicts.

High Employee Turnover

Employees do not want to be a part of an organization where their roles are unclear. If the managers treat the employees as a pendulum between them, they will most likely get tired of their job roles. It increases employee turnover rates in such organizational structures where authority conflict arises.

Dependency On Staff

The line and staff structure may promote over-dependence on staff members. The staff officer may plan and implement them with their own judgment without suggestions from others. It will encourage others to follow the same path. Thus, the management’s dependency increases on staff for information.

Functional Authority Inefficiency

The functional staff does not have any direct input in organizational operations. They only impart their suggestions to line authorities. The suggestions and recommendations may not always be accepted. Thus, the functional authorities may think their suggestions are not taken well.

Expensive

Line and staff organization is an expensive organizational structure. It requires more resources, including finance and infrastructure. It requires recruiting specialized employees who offer guidance to the line and staff officers. More training and development cost is involved in improving staff performance.

Unsuitable for Small Organizations

While many organizations follow a line organization system, a line and staff system is not suitable for small businesses. It requires high capital to recruit experts for the training of staff. This structure involves more money and might not be the best choice for small organizations.

How to Improve Line and Staff Organization?

Every organizational system comes with some pros and cons. However, you can make the best out of it by making adequate changes in the organizational structure. 

  • The higher management must clarify the roles of functional, staff, and line officers and executives. They must stay within the limit of their authority and act accordingly.
  • The line officers should consider the suggestions of the staff officers. The line management must give appropriate reasons in case of rejection.
  • Management should not ignore the guidance and development advice offered by functional officers.
  • Line and staff officers and managers must understand each other’s work scope and not try to interfere.

The Bottom Line

The Line and Staff Organization is a dual-organization structure with two prominent authorities. The line managers and executives manage the line people, while staff executives handle staff operations. Line managers plan, and staff helps in execution and betterment. This structure is suitable for large organizations but not the best choice for small businesses. It may increase the employee turnover rate if the job roles are unclear. The higher management can help improve line and staff structure by well-defined job roles and considering suggestions of functional officers.

Filed Under: Management

Advantages and Disadvantages of Authoritative Leadership Style

Last Updated on March 2, 2023 By Methew Harbor Leave a Comment

Leadership and management are considered essential elements of running a business. Whether you are an entrepreneur or work for someone else, leadership qualities are a must for success. Studies show that every individual is a leader in their capacity and must exhibit leadership qualities like taking responsibility and initiative. Yet, things are slightly different when you are in a leadership role. When you are the CEO of your business or your higher management chooses you to be in a leadership role, you are responsible for your team. You are questioned for your performance and progress as your individual performance impacts your role as a team member as well.

As a leader, the main goal is to increase the productivity of your team and make sure everything goes smoothly. However, every leader is different from the others. Some leaders are autocratic or authoritative that keep the control in their hands. Alternatively, transformational and visionary leaders do not micromanage their teams. They allow the team members to give their best in whatever way they find convenient.

Let’s tell you more about authoritative leadership, including the advantages and disadvantages of the authoritative leadership style.

What is the Authoritative Leadership Style?

The most precise way to explain an authoritative leadership style is an authoritative leader’s motto, “My Way or the High Way.”

Authoritative leaders are also known as autocratic leaders. These leaders create specific operating guidelines and work according to the pre specified guidelines only. Authoritative leadership does not appreciate free thinking and creativity. Such leaders like to keep control in their hands and do not offer leadership opportunities to their team members.

While authoritative leadership is not considered the best practice, it is still widely used in a few organizations. It is a preferred choice of leadership style in government structures where people must align to a specific method as changes may lead to problems. The leadership is centralized without empowering others to make decisions.

Qualities of an Authoritative Leader

Before we talk about the advantages and disadvantages of the authoritative leadership style, let’s look at the qualities of authoritative leaders.

  • Authoritative leaders can take on challenges and finish projects without entirely relying on the team. They do not wait for the team members to update them about the progress and ask for it themselves before delegating further tasks.
  • These leaders are confident in their decisions and are most unlikely to change their working methods. They are sure of their conduct and processes as those practices have provided outcomes throughout their career.
  • They take the responsibility seriously and do not distribute the burden among the team. They carry most of the workload on their shoulder, and their team depends on them as the main decision-makers.
  • Authoritative leaders have good communication skills to communicate all tasks down the hierarchy. Dealing with a lot of people at once can often lead to miscommunication. Thus, these leaders possess assertive communication skills to ensure proper communication among all channels.

Now that you know all about authoritative leaders, let’s talk about the pros and cons of this leadership style. Authoritative leaders are not only responsible or strict in their conduct. There’s a lot more to this leadership style. Here are all the advantages and disadvantages of the authoritative leadership style.

Advantages of Authoritative Leadership Style

Better Productivity

All the characteristics of authoritative leadership lead to improved productivity within the team. Each team member gives their best in the particular role they are assigned. Employees working under authoritative leaders are aware of their duties and typically produce results as expected. Meeting deadlines on time with no loopholes in the process leads to better productivity from the working. It directs the energy from problem-solving or managing other team members to finding perfection in their assigned tasks.

Relieves Burden from the Team

Authoritative leaders do not only take responsibility but also pressure from higher management. The team members are only expected to focus on the designated tasks without worrying about other aspects of the process. These leaders do not expect their team members to keep an eye on other factors affecting the project. Everyone has to ensure they are giving their best while the leader takes the complex decisions. This pushes the team to perform their tasks vigilantly.

Time-saving

Organizations that follow laissez-faire or visionary leadership styles may sometimes take more time to produce results compared to authoritative leadership. While studies often show that ideas created through brainstorming within ideas have a better impact, it is time-taking. On the contrary, the authoritative leadership style produces quicker results. It is suitable for companies that need to generate results in a shorter time. The leaders assign work along with strict deadlines. The team members do not have to spend a lot of time brainstorming new ideas. Eventually, it also reduces the time to consult with other people to find solutions to problems.

Lesser Mistakes

When everyone in the team follows a pre-designed model for working in the department, the chances of mistakes are less. The leader’s communication skills ensure that the team does not deviate from the given pathway and performs their task accordingly. Moreover, considering their responsibility, authoritative leaders go through each phase of the process to point out any errors and fix them immediately.

Clear Communication

As mentioned earlier, authoritative leaders have articulate communication skills to convey their message to the staff. They are responsible for communicating the progress to the team and higher management. So, employees working under an authoritative leader understand that they cannot instruct other teammates about their tasks. It prevents miscommunication within the team and makes way for better performance when the instructions are clear. It also avoids issues within the team as no team member tries to take the lead over the other by authorizing tasks.

Consistency

The authoritative leadership style provides consistent results, especially when working in small groups. It can be difficult to manage small groups as every member tends to make decisions themselves. Often, workers do not even inform the leaders before deciding on an important matter. In such situations, an authoritative leadership style provides a direction and pathway for the members to work on. There are lesser chances of miscommunication, and the group produces consistent results.

Suitable for Inexperienced Employees

The authoritative leadership style is suitable for inexperienced employees who may not be able to make decisions independently. It gives them a push start and offers an insight into how leaders work to keep the team running smoothly. It will also help them polish their skills of working in a team and utilize the expertise of their leader where needed.

people-smiling

Disadvantages of the Authoritative Leadership Style

Displeasure Within Team

While the authoritative leadership style is a good choice for some organizations, every employee might not appreciate it. Employees coming from a free-reign environment do not like being micromanaged or controlled. This can lead to displeasure and rebellion within the team about the leader being too bossy.

Many people do not like to be dictated to and expected to follow the rules word by word. It halts their creative abilities, and they believe they have been pushed into a small box. Such employees also think that any little mistake can lead to the blame falling on their heads as they failed to care for a minor problem. Thus, many employees prefer working under transformational leaders instead of authoritative ones. On the other hand, Laissez-faire leadership promotes creativity and leadership within leadership.

Lesser Group Input

The lack of involvement from the team also leads to a lack of interest within the team. Often, team members feel demotivated when their experiences or suggestions are not welcome. They stop taking an interest in the processes within the company and only focus on the assigned tasks. It may result in issues the leader does not anticipate. Allowing the team members to give their input to improve the process can benefit the department and the organization.

No Flexibility

Authoritative leaders are highly concerned about receiving the designated tasks on time and usually offer little flexibility to the workers. The employees feel stuck in the company and look for better places to move to. The lack of flexibility may also harm their mental and physical health, resulting in more errors instead of better productivity.

Low Morale

Have you seen how team members love to give their opinions when asked?

Most employees appreciate it when their leaders and managers ask for their suggestions and opinions. Authoritative leaders typically lack this quality. Thus, the workers feel dissatisfied with their job as they find it robotic to only follow a given schedule. Many employees also leave their companies for the same reason they are not able to enjoy their job under authoritative leaders.

Lesser Room for Improvement

Persons, teams, and companies improve through feedback and criticism. However, authoritative leaders reduce the room for improvement within the team to a great extent as they do not ask for feedback. The members avoid offering feedback when not asked due to the nature of the leaders. It hinders the growth of the employees as individuals and the organization as a whole.

Blame Falls on the Leaders

People who are a part of teams run by authoritative leaders fear mistakes. Authoritative leaders do not spare employees minor mistakes and might not refrain from pointing you in front of the rest of the team. It is not so with the team only. Autocratic leaders are held responsible for any problems caused by the team. The higher management does not ask the team members about the issue as they understand the leadership style being followed. They believe it is the leader’s responsibility to deliver the required results.

High Dependency

What happens in authoritative leadership when the leader fails to respond to the team on time?

You guessed it right – the team misses deadlines, and productivity decreases. When the team is so dependent on the leader and not authorized to make any decisions, a delay in communication can stop the operation. It often leads to missed deadlines, delays in project delivery, and loss of clients.

Weak Team Engagement

It has been seen that teams with visionary leaders can perform better together even when no one is specifically authorized. They depend on each other and trust the other person to make the best decision. It also increases their sense of empathy, and the team members may cover another teammate’s task if they are not available. This cycle continues, and the work is not affected even if an employee is unavailable for a short period.

Insecurity

While we mentioned that authoritative leaders are confident in their conduct and methods, it is not always the case. Being humans, sometimes authoritative or autocratic leadership may also make wrong decisions. As authoritative leaders put themselves forward as confident, and experienced, it can be difficult for them to admit their mistakes. It develops a sense of insecurity in them that someone else might take their position if they cannot prove their expertise. The failure to consult with the team and take advantage of experienced members can harm the team’s reputation in the long term.

Higher Turnover Rate

A high turnover rate is common in organizations that follow authoritative and bureaucratic leadership. When an employee has worked in the same environment, performing the same task for some time, they will try to move to another place to learn more. Yet, companies do not typically mind this change as they also believe that they have made the best use of an individual’s capacity. When they receive the productivity they look forward to; such companies are open to recruiting new people interested in the task. However, recruitment is a costly and time-taking process, and it is better to retain employees than hire new ones.

What are the Best Authoritative Leadership Practices?

Being an authoritative or autocratic leader does not mean you only have to be strict in your conduct. You can maintain a healthy relationship with your team by following experts’ practices. Here are the best authoritative leadership practices you can follow:

Improve Communication

To be an authoritative leader to your team, it is important to improve your communication skills. All the matters in the department depend on your communication skills. A flaw in communicating the tasks to the workers to update the higher management can cause serious trouble. Active listening can also help you improve your communication skills while listening to others. Consider the ideas and suggestions of your employees even if you do not find them suitable enough to follow. It gives a message that you care about your team members.

Be Fair

An important factor that authoritative and autocratic leaders often forget is that they must be fair to everyone on the team. While the team does not put in extra input besides the designated tasks, sometimes a few employees feel that the leaders are being unfair. Put great effort into treating everyone in the team fairly and stop anyone who tries to be the leader when following authoritative leadership.

Treat Team with Respect

Often the team members in an autocratic setup also feel like they are not respected as the leaders do not give importance to their suggestions. You may clear to the team that you are the final decision-making authority, but do not make them feel less. Enable them to express themselves and show empathy, so they do not feel disrespected or ignored.

The Bottom Line

Authoritative leadership, also known as autocratic, provides complete authority and control to the leadership only. Some advantages and disadvantages of the authoritative leadership style include increased productivity, less time consumption, clarity, less group input, and weak team engagement. Some people like working under autocratic leadership, but most find it intimidating and dictating. You may choose this leadership style if it suits the organization’s setup.

Filed Under: Management

Signs of a Bad Manager

Last Updated on February 2, 2023 By Methew Harbor Leave a Comment

It’s no surprise that a study comprising LinkedIn participants showed that 88% of them were happy when their boss was absent from work. A bad manager is everyone’s nightmare! We often think that getting into a multinational is the most important goal in one’s professional life. But, working in an esteemed organization with a bad manager is worse.

You do not need a magnifying glass to spot a bad manager in your organization. You can easily point out the signs of a bad manager. Here are a few to help you understand if you are working under a toxic boss.

Over-Work is Routine

Good bosses realize the importance of work-life balance in their employee’s life. Thus, if your boss keeps asking you to stay for a longer time in the office or adds more workload without considering your health they are not a good boss.

Sometimes, a project may require long sittings. However, it must not be a norm in the workplace.

Regular Outbursts

One of the most common traits of a stressful boss is their continuous yelling. Some managers believe that shouting at their employees will gain more respect. On the contrary, it shows that they want to exhibit their power. Yelling in the workplace is a big no.

Does Not Give You Credit

You worked day and night for a project your boss had to present to the CEO. But, he did not credit you for your research and composition.

Haven’t we all experienced it?

It is common for toxic bosses not to credit their teammates. They believe that the employees are working for them and there is no need to give credit. Although, considerate leaders make sure that they provide credit to their team where due.

No Empowerment

Many organizations play a significant role in grooming their employees to excel in their professional life. One of them includes empowering them. Bad managers usually do not want to distribute power as they fear being taken over. While your boss may think otherwise, empowering talented individuals increases growth rates and revenue.

Does Not Support You

If you have not had a great boss, you may not relate. But, let us tell you that supportive bosses make sure to be your best advocate. They understand the strengths and weaknesses of their team and defend them in front of other managers. They do not let others degrade you and emphasize your strong points. Unfortunately, bad bosses with a coercive mindset often lack advocacy. They think it will reduce their authority over the employees.

Micromanagement

There is nothing worse than having to report every moment to your boss. We all expect our managers to trust us a little, right?

If your boss wants to know everything you are doing in the project, they might not have good intentions. Sometimes it is habitual, while managers often want to take credit for the work done. Linked In reports show that 79% of employees have been micromanaged at least once in their careers. It reduces innovation and interest in giving the best.

No Feedback

While bad managers may believe in micromanagement, they often forget about the feedback. They fail to conduct one-on-one meetings for their team. How does one improve their performance without constructive feedback from the leaders?

Favoritism

Favoritism is a common issue in workplaces where bosses like to divide and rule. Managers may choose a few favorites in the office and assign important responsibilities to them only. They justify this irrational delegation of tasks by overstating their favorite’s abilities. This behavior in an office is quite unprofessional and must be conveyed to higher management or the HR department.

Innovation is Not Welcome

How many times has your boss rejected an efficient working strategy? Uncountable times? Don’t worry. You are not alone in this boat.

Autocratic leaders with an authoritative mindset are often against innovation in functioning. They prefer giving strict instructions to comply with. An unappreciative manager neither encourages your ideas nor conveys them to higher management.

Lack of Clarity

As opposed to authoritative leaders, some bosses are not interested in the company’s benefit. They do not clarify the objective, mission, strategy, or expected outcomes. They might not give clear instructions about the task or change their mind too often. It is one of the most alarming signs of a bad manager. Influential leaders always have a game plan and clear goals communicated to their team.

Insulting Employees

Man pointing as blaming

Insulting someone publicly is the worst thing to do. Yet, some bosses do it intentionally. It could be due to favoritism in the department or a minor mistake. Many bosses exhibit their authority by publicly criticizing an employee over a slight error or miscommunication. Run away from such a boss immediately.

Under Delivering

A good boss always calculates and promises only what is possible. Alternatively, toxic managers do not consider the possibilities beforehand and usually overpromise. It leads to mistrust and an inability to deliver work on time.

Demotivating

It is a given with bad managers that they fail to motivate their employees. Laissez-faire leaders encourage their teams to innovate and give their best. However, self-centered bosses do not care about the morale of their employees and want to use them as much as possible. This work environment can be mentally and physically draining for the employees.

Lacks Ownership

Lack of ownership is among the most prominent signs of a bad leader. Typically such bosses hold the team for blunders regardless of their mistakes. While they fail to give credit for success and offer feedback, they also lack ownership of mistakes.

Ungrateful

If your boss says Thank you to you for staying extra hours, you are lucky. And your boss is definitely not a bad manager. However, it’s a rare sight.

Most people encounter toxic managers in their careers who are never thankful to their employees. They do not care if you work from home, stay extra hours in the office, or sacrifice your weekend. They believe that they are entitled to these services because they are an employee.

Does Not Say “No”

These managers are difficult to classify as bad or good managers because they are good for some and bad for others. For example, your boss’s boss asks for a presentation due next week. He might know that it is impossible to give it to him by the deadline but commits anyhow. Overpromising and the inability to say “no” increase your workload. Such a boss can be huge trouble sometimes.

Gossips

While leaders usually stay out of politics within the department, some enjoy the gossip. Your toxic manager may indulge in office gossip, leading to miscommunication and trust issues. It is preferable to avoid giving personal information to employers who do not respect your privacy.

Over-Dependent

Managers who lack clarity are more liable to over-dependence on their employees. They might look to their team to perform the tasks independently without proper guidance. The lack of direction in the team may cause distress and failure to meet deadlines.

Fails to Resolve Conflict

Affiliate leaders are well-known for their ability to resolve conflict and promote harmony within the company. But, your manager might not have the same mindset and fail to resolve conflict among team members. Prolonged resentment within the team may lead to issues in work processes.

Poor Listening

A bad manager is not only bad at resolving conflicts but also does not listen to their employee’s concerns. The inability to listen to and understand the team’s problems discourages the team from putting their input toward the functioning.

No Team Building

The lack of listening, miscommunication, and favoritism in the organization causes problems among the workers. They do not appreciate each other’s roles and try to be among their boss’s favorites. This tug-of-war between employees disturbs the working atmosphere and lacks teamwork.

Unprofessional Behavior 

A less-talked-about crucial element of having a bad boss is unprofessional and unethical behavior. Some bosses are evil beyond the functional issues and try to hit on or date their staff. They do not only ask to date but also threaten job security and make false allegations when refused. It’s a sad aspect of working under a toxic boss.

High Turnover Rate

Before you join a company, you must check the turnover rate. The retention or leaving of employees speaks a lot about the management and the bosses. A high turnover rate within the department is a critical sign of a bad manager. Supportive managers usually make an effort to keep their employees instead of letting them go immediately.

How to Survive a Bad Manager?

Once you know the signs of a bad manager, you can beat them and survive in the environment using a few techniques. Some of the best ways to survive a bad manager include ignoring them if they say anything bad, acting like you do not understand what they mean, mentioning their mistakes to them, and improving your skills. Improving your skills will allow you to look for better jobs and get rid of this toxic atmosphere.

Filed Under: Management

Advantages and Disadvantages of Strengths-Based Management

Last Updated on February 4, 2023 By Methew Harbor Leave a Comment

As they say, “do what you love and love what you do.”

However, not everyone gets the opportunity to do what they love. The managers often do not let the employees love what they do because of their behavior.

According to a survey by Gallup, managers do not appreciate their employees’ strengths and try to fix their mistakes instead. The reports show that only one out of three employees say that they have the freedom to perform what they excel at.

Another study shows that strength-based management improves the organization’s engagement and productivity.

Let’s tell you about the advantages and disadvantages of strength-based management in detail.

What is a Strength-Based Management Approach?

A strengths-based management approach considers the employee’s strengths over the weaknesses. This management system does not ignore shortcomings but assigns tasks based on the worker’s strengths. When the managers focus on the employee’s strengths, the team works on their weaknesses to turn them into strengths.

Core Principles of Strength-Based Approach

The definition of a strength-based approach gives nine guiding principles that act as the backbone and guiding practice.

Everyone has Potential

One of the main characteristics of the strength-based approach is that limitations do not define a person. Each team member has strengths and capabilities that differentiate them from others.

We Become what we Believe in

Strength-based management encourages seeing challenges as opportunities. Such leaders, like coaching leaders, push their teams to take on challenges and believe in their potential.

Your words Determine your Reality

One of the most common issues with traditional coercive leaders is their choice of work. They do not care about using bad language with their employees to get the job done. Modern leaders opt for a friendlier approach and use thought-out words to motivate their teams.

Change is Necessary

Changes are critical in any transformational leadership to change the way people think and behave. It allows them to improve and do better in their jobs.

Better Relationships Lead to Positive Changes

When people trust in their management, they change per needs. They are ready to accept challenges and do their best to succeed. On the contrary, unsupportive management cannot bring the best out of its people.

Every Individual is the Author of their Story

One of the nine guiding principles contributing to the advantages and disadvantages of strength-based management is understanding by the management. You must understand that each person creates their own story. You may guide them but do not shape them.

Begin with Acknowledgment

Begin the change and strength-based approach by acknowledging what the person already knows. They may be more willing to take on challenges relating to what they are familiar with.

Change has no Shortcut

It suggests that there is no single method for change. It is a journey and process with several steps. It requires patience and flexibility.

Change is Inclusive

When you are working to bring changes in an organization through a transformational or strength-based approach, it must be inclusive. The leaders should inform the team of the expected changes and discuss how to cope with them.

Advantages of Strength-Based Management

Improved Skills

Improvement in skills and job roles of the employees is among the most prominent advantages of strength-based management. It gives them the confidence to explore different domains and expand their skill set. Highlighting your employees’ natural abilities pushes them to give their best and take on new job roles faster. This approach gives rise to better leaders for the future with better hard and soft skills.

Increased Productivity

A positive environment in the organization always allows the employees to be more productive. Another survey by Gallup also suggests that employees working on areas of their strength are 7.8% more productive. When the teammates learn new skills and take up challenges, they perform better and give improved results.

Less Time Consumption

Many managers often focus more on fixing the weaknesses of the employees than strengthening their skills. However, enhancing and utilizing existing skills takes less time than fixing imperfections. Often employees do not cooperate with the management, resulting in time wastage. Thus, it is better to focus on the skills and abilities of your team and work to improve them.

Builds Self-Esteem and Confidence

Strength-based management helps build self-esteem in the company. It also improves emotional intelligence and teamwork in the organization. The workers believe in their skills and abilities, which gives them the confidence to believe in themselves.

Higher Engagement

Every department in a functional organization performs a specific function. The tasks are divided among different team members. The division of tasks among the team members according to their expertise and area of interest brings them together to accomplish goals. It keeps everyone in the team engaged and offers better solutions utilizing their strengths. Reports show that the strength-based approach engages double the employees as the average engagement of 30% in the US.

Better Mental Health

Mental Health

The strength-based approach focuses on the team members’ strengths but does not drain them. Employees feel less stressed, upset, and tired when the right strategies for strength-based management are used. One method is not to keep them working for hours continuously if you want to adopt a strength-based approach in your organization, ensure not to burn out your employees.

Less Turnover Rate

Helping employees improve the skills they feel confident about instills trust in them. It enables the team members to contribute to organizational success in the best possible way. Happy employees do not leave your company to move to another.

Disadvantages of Strength-Based Management

No Scientific Evidence

There is no scientific evidence regarding employees in a strength-based management company. While different studies suggest that people in a company work better when their managers focus on their strengths, no studies show exact results. The absence of scientific backup does not mean this approach is ineffective.

Increase in Competition

This management approach allows employees to identify their strengths and improve them further. It drives a sense of competition among peers as well as the higher personnel. However, it may become a disadvantage of strength-based management when the executives see the juniors as a threat. They might think the juniors will become experts and take over their position.

Over Confidence

Overused strengths have the tendency to become toxic in the long run. Team members who work hard on their skills believe that the company cannot survive without them. This overconfidence can lead to unreasonable demands and issues within the organization. The managers might not realize when some of their teammates become toxic because of their overconfidence.

Ignores Weaknesses

The suitable strength-based management approaches make sure that you do not ignore the weaknesses of your employees. Sometimes the leaders entirely focus on their strengths without understanding how their shortcomings can hinder their progress. Successful strength-based management highlights and improves the string points without neglecting the weaknesses.

The Bottom Line

The advantages and disadvantages of strength-based management depend on how you implement the system. It can help boost productivity, increase engagement, improve skills in less time, and reduce turnover. Alternatively, you may neglect the weaknesses of your team workers leading to overconfidence and a sense of competition. Thus, it is essential to apply strength-based management considering the guidelines to get the best out of it.

Tom Ruth mentions, “If you focus on people’s weaknesses, they lose confidence.” So, focus on their strengths and see how it facilitates organizational growth.

Filed Under: Management

Advantages of Matrix Organizational Structure

Last Updated on January 27, 2023 By Methew Harbor Leave a Comment

Companies usually follow a centralized or decentralized organizational structure. Yet, sometimes organizations also adopt the matrix system. The matrix system pushes the team to work towards their goals more efficiently as they report to more people. It allows the managers to keep in touch with the teams and their members.

The matrix structure has disadvantages but still, it is more suitable for interconnecting different departments and having them on board about company activities. Let’s tell you all the advantages of matrix organizational structure to know why big names like Starbucks use the matrix system.

What is Matrix Organizational Structure?

The matrix organization is a fusion of functional and project management systems. It consists of an organizational structure where the employees report to multiple people simultaneously. It comprises a functional and a project manager. The project and functional managers supervise members of the same team. It enables the functional manager to have details of each project at the root level. Having a matrix organizational structure also gives insight into each employee’s performance.

Components of a Matrix Organizational Structure

The two fundamental components of a matrix structure are a functional manager and a project manager.

  • The functional manager oversees the horizontal structure according to the department. They represent the traditional organizational structure.
  • The project manager manages a cross-functional team. It is usually a different team for each project with representatives from each department.

In a matrix organizational system, these hierarchy systems work side by side. It gives equal, more or less opportunity to both according to the type of matrix structure.

Advantages of Matrix Organizational Structure

Inter-Departmental Harmony

A matrix system brings different skilled and experienced workers together for a particular project. It improves communication between different departments and allows them to communicate openly. As more companies move towards specialized job roles, employees from different departments form a team. Employees from varying departments trust each other’s abilities under the functional and project managers.

Flexibility

Besides specialized jobs, the matrix system allows workers to perform different tasks in a project. While the right people perform the right task, they also get an opportunity to understand the working of other departments. This encourages the employees to give their input on the project based on previous experiences. You may also utilize a specialized person for another task per need as they understand the working through matrix system.

Steady Flow of Information

The flow of information is more efficient and quick when it goes both horizontally and vertically. It also prevents miscommunication as the employees report to two managers at once. All the team members are in the loop about the process and status of tasks.

Less Time Consumption

One of the most significant advantages of matrix organizational structure is how it speeds up the process. Communication between departments and the higher hierarchy makes the process quicker. Every person within a team performs the assigned task and reports to the managers. They command the next step to avoid hindrance in the process.

Efficient Use of Human Resources

When the employees are flexible and understand the process of different departments, they can be used more efficiently. The employees can be used in another domain if required. This saves you from hiring a new workforce for a short period.

Adaptation Per Need

The matrix system is of three types; weak matrix, strong matrix, and balanced matrix system. Each of them gives different authority to the functional and project managers. Organizations may choose from one of these according to their need for every project.

Consistent Functional Roles

This system combines functional and project roles. While the project roles may end with the project, the functional roles stay consistent. The team may participate in other projects. Thus, it provides better job security to the employees.

Employee Growth

Working in a diversified environment in various projects enables the employees to learn more skills. They can utilize these skills in their job role or participate in other projects. It provides growth opportunities to the employees while excelling in their respective fields meanwhile.

The Bottom Line

The matrix system is a combination of functional and project management. In such a system, the members of each project team report to the functional and project managers. The advantages of a matrix organizational structure include less time consumption, open communication, flexibility, and choosing the right structure. It also empowers the employees by securing their jobs in functional roles and enabling them to acquire new skills.

Filed Under: Management

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