When it comes to management, there’s no one-size-fits-all strategy. The right approach depends on many factors, including the location of the business and the type of sector. This blog post takes a look at the different management challenges posed across a variety of industries and contexts and the strategies that leaders are using to solve them.
Strategies for manufacturers
For manufacturing companies that are largely centered around creating and selling products, challenging management decisions are often asset-focused in nature.
When a company’s main assets are machines and equipment, so too are their main cost concerns. This year, for example, capital expenditure in the oil industry by top production and exploration companies is expected to hit $450 billion.
If budgets get tight and it’s time to cut back and increase efficiency, then the first place that management looks is toward fixed costs. Can the factory get a cheaper energy deal? Can a certain piece of machinery be retired and sold if it’s not producing enough at a cost-effective rate?
When it comes to efficiency, at least, managing people is often just a sideshow. The fact that workers are often low-paid means that they are more replaceable and don’t get as much care and attention as their colleagues in more service-focused jobs.
The rise of services
For companies that offer services rather than manufacture products or provide energy, budgets are often invested entirely into people, and staff become the biggest asset.
Here, it’s much more important for managers to think about the impact that big decisions will have on staff. Take the shipping industry’s Evangelos Marinakis, chair of Greece-based Capital Maritime & Trading Corp, who famously takes the welfare of staff very seriously.
“He is demanding but also close and always there for his people,” said Milos Advisors boss Socrates Kominakis. And it’s paid off: Marinakis’ company has over 50 vessels in operation and has won international recognition such as the GREEN4SEA Excellence Award.
While looking after staff is important in the manufacturing industry as well, staff are much more replaceable when they form only a small part of a company’s expenditure. In the service sector, good staff are a company’s main priority. This is why offices are more comfortable environments than oil rigs!
However, the two distinct sets of challenges are slowly merging. The fast-moving consumer goods industry, for example, has traditionally relied on people to perform till and checkout desk functions, but that’s now changing. Management teams that once put people at the heart of their core transactions are now finding that self-checkout systems can cut costs and raise profits, so supermarket bosses are changing their strategies in response to shifting technologies.
Talk to your customers
If you’re in a niche industry, then one of the best management strategies available is to be open and reach out to your client base.
Because your customer base is smaller, the level of effort that you put into this will be easier for clients to see. There’s more chance that the time you invest in speaking to your customers will bring you strong returns.
By posting to the social media groups that clients are a part of and getting involved in their offline and online conversations, you will show yourself to be a conversationalist rather than a faceless boss.
Remember, however, to stay disciplined: posting once is not enough, and only consistent content will bring you the results that you deserve.
Location, location, location
Strategies may also need to change from place to place. Managers of companies in the Nordic countries, for example, often create and nurture more democratic ways of running businesses, such as flat hierarchies and consensus-based approaches to management.
One Swedish company, Crisp, took the non-hierarchical strategy to extreme levels by running an experiment where it abolished managers and let employees make all decisions as a team.
Management strategies in America and Western Europe, in contrast, could not be more different. It is common for leaders in those places to dominate team discussions and treat juniors as functionaries rather than equals until they climb the career ladder.
Leaders are clearly responding to different sets of challenges. America and Western Europe have booming economies to sustain and large populations to employ, creating highly competitive environments. The Nordic countries, on the other hand, have less economic pressures and fewer people, making a collaborative environment ideal.
No matter what industry you operate in or where you’re based, it’s important to find a successful management style that works and brings the best out of you, your assets and your staff. Staying consistent in your approach and responding to your particular circumstances and surroundings will give you a head start in building a long and successful management career.