Essays in Human Side of the Enterprise: Management Systems, Financial Planning and Employees’ Reactions in a Developing Economy of the 21st Century

Abstract

An enterprise's survival and goal achievement to a greater extent depend on its management system, financial planning strategies and employees’ reactions. The management system (authoritarian or humanistic) portrays the firm as a composite entity of a goal-setting machine (top management) and a goal-achieving machine (subordinates and employees) in an organisational context. The type of management system and its associated financial planning strategy are admittedly of significant effect in the life of any firm. This is because the goal of the organisation (for the period the financial plan covers) is contained in the financial plan. Goals must not only be set but strategies must be evolved to achieve the goals contained in the financial plan. Financial plans (autocratic or participatory) express the expectations of the enterprise from its members and specifies the employees’ duties and rights (if any) for that period. Financial plan, therefore, is an important instrument for enterprise goal achievement. This paper was necessitated by the unconcerned attitude of enterprise management with current researches in financial planning theory and practice. Available Accounting, finance and Business literature support the assertion that authoritarian management systems and their associated financial planning strategy do not always work. Rather than bringing improved performance, such a system generates anxiety, mistrust, interdepartmental strifes, quarrel with finance staff, demotivation, corrupt activities, poor productivity and other dysfunctional attitudes and behaviour which are inimical to enterprise growth and survival. On the contrary, a humanistic management system relative to its financial planning strategy triggers employees’ morale, motivation and productivity. Such a system boosts corporate existence and enhances continued goal achievement. This system is believed to serve as a panacea: a cure for all the many ills associated with the authoritarian management system and its related autocratic financial planning strategy.