Different Management Models and Philosophies
There are countless models for management and governance that are more or less well-known. These models often have different acronyms and have evolved and become more numerous over time. Some of them, several of which are related to each other, are briefly described below.
Despite the diversity and popularity of the different models, it is very common for organisations to have developed their own management models, often inspired by one or more established models.
Examples of Management Models and Key Concepts
"Empowerment" is a common term in the management industry that represents the belief that participation and transparency in management and follow-up strengthen the business and work environment and lead to good results. The concept aims to empower an individual in an organisation, state or group to feel that he or she has power over their own situation, tasks or environment. The individual should feel empowered.
Empowerment has been widely used since the 1980s and 1990s in organisational and skills development.
In companies or organisations where employees feel they cannot influence the situation, there is often poor customer service and low efficiency. Therefore, it is in everyone's interest to establish organisations with strong "empowerment".
Objectives and Key Results (OKR) is a popular Goal Management framework that helps companies implement and execute their strategy. The focus is on collaboration, tracking progress, making adaptations, and encouraging engagement around measurable goals. The benefits of OKR include a higher focus on significant results, increased transparency, and better strategic direction (Google uses OKR).
Hoshin Kanri simplifies resource prioritisation, provides managers with insights into performance, communicates the strategy clearly and widely, and provides a clear understanding of the current situation. There are clear links between Hoshin Kanri and 'the Deming Cycle'.
Balanced Scorecard (BSC) is a model for measuring more than just financial metrics (hence the "balance"). "Management cannot directly influence financial results anyway - there are many other things that management can change more easily." The Balanced Scorecard contains dimensions for finance, process, customer, and learning and development.
The model and approach were established in 1992 and gained widespread popularity. Advocates highlighted a structure for compact and comprehensible information, relationships between metrics and strategy, and a systematic approach to replacing pure financial planning and monitoring. The model has been further developed in many updated versions.
TQM - Total Quality Management is a philosophy that focuses on quality in everything the company does, from processes to products. Established in the United States in the 1980s with Japanese inspiration.
ISO - International Organization for Standardization is an international standardisation organisation, represented by national standardisation institutions that work with industrial and commercial standardisation, several significant ones within the management, quality, and environmental areas (the ISO 9000 and ISO 14000 groups). ISO began its operations in 1947. Starting from processes rather than functions is a requirement when building such management systems.
ISO is a non-governmental organisation with a powerful ability to set standards. In practice, they operate as a consortium with strong ties to the governments of member countries. Members are formally national standardisation bodies from each country and also larger companies. ISO standards have been rapidly accepted internationally and used by almost all countries.
Just-In-Time (JIT) is an idea to limit inventory to a minimum. Of course, it requires a lot of BI and internal communication. Established at Ford in the 1920s.
Activity-Based Costing (ABC) is a method for identifying the relationship between costs and activities in an organisation, in order to determine the actual costs. One point is to transfer indirect costs to direct costs. Established in the late 1980s with origins from the 1970s.
Business Process Reengineering (BPR) is an efficiency method that starts from processes (end-to-end) rather than functions in the organisation. Wants to cut out all work that does not add value to the customer (established in 1990).
LEAN - Lean Production is a philosophy on how to manage resources. The purpose of Lean is to identify and eliminate all factors in a production process that do not create value for the end customer. Simply put, it's about "more value for less work".
The basic principles of Lean Production are rooted in ideas from, among others, Taylor, who, with Scientific Management, inspired Ford to create a production system for mass production.
Investors in People (IIP) is an internationally recognised standard for quality development. The focus is on employees' competence and how it is utilised in the organisation, factors that are crucial for the organisation's attractiveness and competitiveness.
The purpose of the standard is to ensure that: (1) competence development coincides with and supports the purpose and goals of the business. (2) Managers take a holistic approach to employee development. (3) Employees feel engaged in the development of the business and their colleagues.
Are You Having Trouble Getting Your Management Model to Work?
Defining and establishing a Management Model and/or Management Philosophy in your organisation is not always easy. It is therefore becoming increasingly important to have a system support that enables you as a manager to involve your organisation in the planning process, as well as to create a clear thread between strategies and what happens in everyday life.
Hypergene's software provides you with the conditions to connect strategies with goals, key figures and activities. Additionally, you can work with both Business Planning and Financial Planning in one tool.
You also have access to quality-assured information needed for planning, follow-up and analysis. Hypergene, therefore, helps you make decisions, steer towards goals and achieve a higher level of performance and efficiency.
10-minute video demo of Hypergenes solution: