Business Management Problems

This essay will discuss three problems within JJs. They are Joe¡¯s centralised power, conflict between Kurt and Marama and ineffective marketing strategy. They will be analysed, by the theory of law, management, social science and marketing on the power and culture¡¯s perspective, to view how leader exercises the power to effectively manage his business and employees, how power and culture influence the organisation¡¯s operation and how power and culture contribute a company¡¯s marketing strategy.

The first problem in JJs is Joe¡¯s centralise power without empowerment to subordinates. Executive leader can benefit by a knowledge of power sources in order to influence others to achieve organisational goals. Different power types in organisation lead positive and negative motivations to staff (Bartol, Tein, Matthews & Martin, 2005). Because coercive power emphasises on punishment, staff will have resistant feeling, work passively, lack enthusiasm and even undermine organisational goals attainment. Staff feedback to legitimate, reward, information power is compliance, so staff will behave obediently and make minimum effort to work. As for expert power and referent power, because the powers come from staff admiration to the leader, so staff will be willing to work hard and be devoted to organisational goals. Take an example of Joe¡¯s leader power in JJs. He develops coercive power and intimidates his staff, so his staffs refuse to work more, when there is work to be done. The theory of leadership and power suggests that leaders must be able to recognize powers play in organisation and rely on some or all of them effectively to lead employee.

A limited liability company is a separate legal entity existing under Companies Act 1993. Although a company is owned by shareholders and operated by directors, it has its own identity separate and apart from its shareholders and directors. Therefore, a company is a juristic person, obviously not a human being. As the management of power is relied on directors, Companies Act 1993 indicates ¡°a director of a company, when exercising powers or performing duties, must act in good faith and in what the director believes to be the best interests of the company¡± (Government NZ, n.d., para.131). An example in JJs suggests that Joe, as the director and CEO of company, does not treat JJs as a separate legal entity and excise his powers properly. Joe is JJs¡¯ shareholder as well as Apex shareholder with a 30% shareholding in that Joe gives JJs¡¯ replacing equipment business to Apex, although Apex quots is 20% higher than another company¡¯s.