Management Theory and Ethic That Optimizes 21st Century Firms

Introduction 

Success in any organization is based on the management theory that its managers apply to achieve the objectives of the firm. In highly competitive economic and business world, cutting edge management practices and theories need be applied in a competing organization. Managers have since recognized the diversity of management theories, and therefore the application of a single theory is primitive if the organization is to compete in the growing economy. Organizational productivity is the goal of management, and management theories are applied as tools to achieve that strategy. Ethics in an organization are the moral backbone through which the firm implements its goals as promised to its stakeholders. The business world is intrinsically complex; there various issues while doing business become controversial (Burke, 2017).  Ethics become the guiding tool to negate that minefield that may damage the organization’s reputation and status in the society. Business practices and ethics have a bearing on the competitive nature of any organization, especially in the current world of communication. Information flows relatively easy on issues of an organization to its stakeholders, therefore, for an organization to maintain a healthy reputation, solid business ethics and management theories have to be applied. 

To adequately discuss this subject matter, this paper will explore AT&T as a casing reference. AT&T has been in operation since the twentieth century, and since then, the world of business has changed dramatically. Being in the communication spectrum, AT&T has witnessed drastic changes in the field and therefore, its evolution to compete in the twenty-first century is imperative to this paper. This paper will be critical to analyze and discuss various management aspects, theories, and ethics that allow AT&T to compete effectively as a firm in the twenty-first century. 

Management 

Management is broadly defined as the act to achieve coordinated efforts to achieve particular goals in an organization or among people. For a society to accomplish its set goals, it has to rely on the efforts of all the individuals in the organization. Coordinating such efforts, therefore, requires a well thought out plan and structure to be in place. Management, therefore, evolved as the coordinating tool that recognizes the value of collective and coordinated individual efforts for maximum productivity (Watson 2013) . For instance, looking at the structure of AT&T as a firm, there are about 280,000 employees in the firm, each of those individuals has a particular task they are allocated. Safeguarding that their undertakings are in line with the objectives of the firm is the management function. Several factors influence management practices as well as the concepts applied, and they include; political, social and economic factors. 

Political factors 

Politics is an intrinsic part of doing business in the economic world, political decisions reached either in the form of government regulations, trade policies or political institutions affects the running of an organization. For an organization to be allowed to go into business, they have to comply with the set political obligations. These issues come regarding employees' composition, rights of the employees and those of customers, labor laws, product standards as well as environmental regulations (Watson 2013) . For instance, AT&T has to comply with the labor laws regulations as well as the product standards set by the government in order to compete effectively in the market. 

Social factors 

Business is not conducted in a vacuum, it takes place in a social setting, and people have developed a set of social constructs that guide their association with an organization. These norms should inform the interaction of the organization with its stakeholders. AT&T is a communication and technology company; the management recognizes the nature and culture of the American people who form a large percentage of its customer base as well as its labor force. 

Economic factors 

The economy determines how an organization evolves and subsequently the management culture to be adopted. Factors such economic freedoms as well as competitive markets must be considered in management. In response to economic factors, AT&T had to reinvent itself as well as its management approach to compete in the current digital age of online platforms. 

Management theories 

In management, several theories exist and are often used interactively to allow for maximum production in an organization. A manager considers several factors in a firm to appropriately choose a theory to apply. These factors may include; the objectives of the company, the workforce employed by the organization, as well as the field that the company is operating in. It's imperative that those factors are considered. Otherwise, the theory applied will be rendered counterproductive under certain conditions (Burke, 2017). These theories include contingency theory, systems theory, chaos theory as wells as the theory of X and Y which are widely applied concepts in management. 

Contingency theory 

This theory of management is underpinned by the situations that arise in an institution. It avows the need that the decisions made by managers be based on the situations that arise in the organization. It discourages the fitting of general decisions to all situations. For instance, when AT&T recognized that all it competitors are competing and entering online wireless platforms, no prior blueprint decision could be applied. Therefore, managers had to move fast to be competitive in the market. 

Systems theory 

Systems theory is based on the wider perspective of the complicated relationship between a worker and the system. The employee affects the system, and the system affects the worker. For efficient management, managers have to carefully identify the pattern of effects for the workers and the organization to be productive (Lichtenthaler, 2016). At AT&T, managers have used this theory to coordinate organizational development over the newly invented departments of the online platforms and other existing departments. 

Chaos theory 

Chaos theory has increasingly been used by AT&T firm in the recognition that change is continuous. The world of technology is changing every day, and for the organization to stay competitive, it has to evolve or change to the current status. In recognition of these, AT&T has invested heavily in training and developing its employee’s talent management strategy. Therefore, by not evolving into the new order of doing business, the company risks being rendered obsolete by the new firms growing in the new era of technology. 

Theory X and Y 

This management theory is based on belief systems on the attitudes of workers. This influences the choice of practices and theories applied in management. For those who believe that workers lack ambition will use theory X while those who believe that employees are self-driven and welcome responsibility will apply theory Y (Lichtenthaler, 2016). This is often reflected in the compensation plan that the management adopts for its employees. 

Ethics 

Ethics in doing business are crucial in ensuring a mutual level of trust between the organization and its stakeholders. They refer to the policies and guidelines that an organization applies to interact with its employees as well as its customers effectively. Ethics in this context goes beyond the dichotomy of right and wrong. They seek to reconcile the firm’s activities legally while at the same time allowing the firm to have a competitive gain in the market (Crane, & Matten,2016). There are several issues tied to ethics that are of critical importance for the firm to compete in the 21 st century. They include the issue of reputation and breach of the ethics code. 

Ethics and reputation 

The reputation of an organization is one of the largest unquantifiable competitive advantages a firm may have. It’s woven from the perception the stakeholders have about the firm. For instance, AT&T as a communication and technology company has been in existence since the invention of the telephone. It has therefore invested immensely in the communication infrastructure. It has not been left out in the modernized communication platforms; the company has evolved into the 21 st century way of doing business (Hoffman, Frederick, & Schwartz, 2014).  This has created a sense of reliability within the stakeholders, and therefore customer loyalty is established. This is the nature of reputation. The ethics code of maintained production of quality products and services has helped the organization to maintain its competitive advantage in the market. 

Ethics code breach 

Misappropriation of management leads to a violation of ethical conduct in any organization. This is potentially disastrous for an organization that seeks to compete in the market. AT&T had a similar case of breach of the ethics code in 2014 which left the company with a loss of 100 million dollars in lawsuit compensation. The case was on the presumed illegal throttling of the unlimited data plan offered to its customers (Crane, & Matten, 2016). The losses incurred cost the firm dearly which is an indication of the devastating nature of breaching the ethics code. 

Conclusions 

Management and ethics as discussed form an intrinsic part of the success of any organization. The manager has to carefully consider the theory and practice to use based on a critical analysis of the factors that affect the organization. Ethics should act as a compass to the direction of the firm in achieving the set objectives. It’s imperative that for a company to compete in the current world of economy, to carefully do so with an envisioned strategy in management and ethics. 

References 

Burke, W. W. (2017).  Organization change: Theory and practice . Sage Publications. 

Crane, A., & Matten, D. (2016).  Business Ethics: Managing corporate citizenship and sustainability in the age of globalization . Oxford University Press. 

Hoffman, W. M., Frederick, R. E., & Schwartz, M. S. (Eds.). (2014).  Business Ethics: Readings and cases in corporate morality . John Wiley & Sons. 

Lichtenthaler, U., & Lichtenthaler, U. (2016). Six principles for shared management: a framework for the integrated economy.  Journal of Business Strategy ,  37 (4), 3-11. 

Northouse, P. G. (2015).  Leadership: Theory and practice . Sage publications. 

Watson, T. (2013).  Management, organization and employment strategy: new directions in theory and practice . Routledge.