Hard & Soft Management & Their Effect On Organizational Performance

Hard & Soft Management & ERP 

In every organisation there is an essential unit in hierarchy which is intact core if the organizational existence. We also call this the first level management. Top management is made up of senior-level executives of an organization, or those positions that hold the most responsibility. Jobs titles such as Chief Operating Officer (COO), Chief Executive Officer (CEO), Chief Financial Officer (CFO), President, or Vice President are commonly used by top managers in organizations. These top managers are responsible for setting the overall direction of a company and making sure that major organizational objectives are achieved. Their leadership role can extend over the entire organization or for specific divisions such as finance, marketing, human resources, or operations.

Organizational Performance 

Organizational performance comprises the actual output or results of an organization as measured against its intended outputs. According to Richard et al. organizational performance encompasses three specific areas of firm outcomes: financial performance; product market performance; and shareholder return. There are several ways to maximize efficiency and effectiveness in organizations which symbolises the performance of an organisation. 

Relationship Between Variables 

The top management has most significant role in terms of impact on organizational performance. ... They carry the responsibility for aligning the performance of their department and its staff with overarching organizational goals. They play a vital role in shaping organizational culture.Performance management is a key business process that ensures well-coordinated individual and team efforts conjoin into organizational goals. This is achieved through the top management strategies policies and implementation of thorough planning.

Enterprise resource planning systems are business software systems that help companies to automate and integrate most business processes, data sharing, and activities within the company, creating and accessing information from the environment promptly enterprise resource planning is identified as the main platform where companies build competitive business process improvements. In the past, ERP systems were almost entirely used by large companies because ERP systems are intended only for large-scale companies and have a high level of business complexity.

Top management support ranks number one on the list of critical success factors for ERP implementation (CFSs). Many studies emphasize the importance of top management support as a necessary factor in the implementation of ERP systems. ERP system is an integrated system and requires cooperation from all business functions in the company. Policies must be established by top management for the implementation of ERP systems, top management must publish and identify exclusively this ERP project as a top priority within the company. Top management support is a form of company leadership involvement in developing the company's information system that support from top management became the number one ranking in the list of critical success factors for ERP implementation.

Top management support in ERP system implementation has two main aspects: (1) leadership, (2) providing the necessary resources. Strong and committed leadership is a necessary condition for success in ERP system implementation. Top management must provide clear direction to the project team and monitor the progress in implementation, willing in providing the necessary resources to demonstrate the high commitment level of top management for ERP system implementation. Top management support includes five indicators including management commitment in the implementation of ERP systems, awareness of long-term support and good leadership for ERP implementation, top management realizing that the implementation system is a top priority, top management provides a strong commitment and provides resources in implementation.

Organizations employ various types of resources to produce its output broadly based on tangible and intangible resources. In the current knowledge-based intense competitive landscape, intangible assets like knowledge has become more crucial component to achieving and sustain CA because it is difficult to imitate, observe and rare in nature. Moreover, knowledge assets have got more importance to achieve and bring innovation and ultimately CA than the conventional sources of production. Appropriate management plays a key role in attaining the competitive edge. Top management is responsible for detecting the tacit and explicit knowledge sources, and employing action plans to transform individual’s knowledge-base into organizational knowledge-base. The top-level management generates a vision, and the middle-level management designs and implements profound steps to resolve the inconsistencies resulting from the gap between what actually exists in the organisations with regard to knowledge sharing and what the top management aspires to achieve. Absence of support and guidance from the top management may result into vague and inadequate flow of information across all the levels within the organisation furthermore the majority of the organizations aim to work within a knowledge-based world with the empowered workforce, their internal organizational structures often adhere a rigid top-down hierarchy; for example, where senior managers command orders to the middle managers, who, inturn, convert those orders into tasks which are to be performed by the front-line employees. 

The top management’s support along with the proper implementation of the employees’ incentive mechanism facilitate knowledge acquisition and stimulate employees to share their acquired knowledge. Moreover, this can further contribute towards the attainment of organizational success and CA. In addition, top management’s support enhances the level and quality of knowledge exchange and internal knowledge acquisition through influencing employees’ commitment. Previous knowledge-management studies have also documented that the supportive behaviours by the top management are essential to nurture an encouraging environment at the workplace (e.g., where the employees are encouraged to apply their knowledge at their work activities freely), which, in turn, enhances the organizational competitiveness.