Management Systems

Problems in Management system in Bangladesh and way to mitigate them Management problem is a fundamental challenge for the country. It is essential to have efficient cost management if we want to see ourselves as an industrialized nation Problems in the management systems are: 1. Problem of managing fund: The major problem a Business firm faces in its establishment period is the problem for capital or sufficient financing problem. One of the first questions any potential entrepreneur must ask is, “How do I get the money”?

The type of the business may be anything but the money necessary for finance is must. Without necessary fuel (money) no ship (Small Business firm) can run As a new Business, there is very few chance to raises the capital from share market. Only personal and family funds and personal loan from the friends are major source. But in this way it is very hard to raise a sufficient amount of capital. 2. Lack of Govt activities: There is a nonstop echo by the government leaders, ‘Come Sun, Come Rain’; trying to state that there is a constructive and favorable atmosphere for investment in Bangladesh.

The authorities are either not working together with the relevant people with adequate response, or they are aware of the reasons for the investors stepping away, however still do not want to resolve problems purposefully with the presumption of ‘ostrich attitude’. ?Administrative coordination problem– Policies and the implementation processes are not materialized simultaneously because of lack of administrative communication and coordination among the government agencies. This situation results in high business costs and hassles for investors ?

Good governance – Good governance can be defined as a desired condition of management and operations. Good governance along with efficient leadership is achieved by bringing accountability in politics and bureaucracy. Government has to reform its policies and business practices to attain good governance. Good governance can bring about efficient and productive sized government, necessary reformation of legal and judicial system, Fiscal policy and infrastructural reforms, eradication of corruption, bureaucracy and dishonesty, and many more improvements in the country. 3. Corruption:

Culture and society have become corrupted through sick politics. The bureaucrats and regulatory bodies are steeped in corruption. For business enterprise, corruption works as taxation or lubrication cost. This corruption would not go up to such an extent if there were appropriate and strong legal and regulatory controls and motivational salary levels. Many companies regard bribery as just one of the costs of doing business (‘Lubrication Cost’) and show these payments as legitimate business expenses. 4. Political and Social Instability: Political and social instability is another big problem.

Whether it is a giant company or a Small Business the success of a business is greatly dependant on the political and social stability of a country. Every business firm is dependant on production or purchasing and selling. In Bangladesh our political and social climate is not stable at all. There is a condition of pre-war between the ruling party and the opposition. Always they are face to face with each other. Very often they call ‘Hartal’ and strikes. Such a loss can not be sustained. According to a UNDP research strike has led to 3-4% GDP losses during the 1990s. In the period of 1991-1996, 173 days of ‘Hartal’ were been called in total.

It was 140 in 1996-2001 sessions. This creates immense burden on the business firms as the shops often get vandalized during strike violence. 5. Poor law and order situation: A sound law and order situation help flourish business. But the situation has deteriorated over the years. Recent drive to improve the situation has helped but it has done damage to the business communities’ confidence. 6. Shortage of Power and Utility supply: Electricity, Gas, Water, Telephone etc. are some prerequisites for a business. In Bangladesh only the sufferer know how tough it is to get those connections.

You need to pay a handsome amount o bribes to a invisible hand. Bangladesh faces a system loss often more than 40% of the gross power generation probing with the lowest per capita power consumption and network coverage of electrification among developing countries. This creates immense discouragement for investment in the power intensive industries. 7. Communication and Transportation Problem Though Bangladesh is a flat country without many obstacles like hills, but some advantage position with hundreds of river all over the country, still communication and transportation is a big problem here.

Water way and Railway is used as easy way of transportation all over the world, but we use road as mostly used way of transportation. This road transportation is expensive and not easy. After the British has left this indo bangle sub-continent we could not expand much our Railway, meanwhile many route and stations are closed. Water ways are almost closed due to filtration and not for proper dredging. 8. Effect of business friendly environment: At present business friendly environment is not present in most of the cases due to: A. Differential treatment :

Even though the prevailing regulations provide for equality in treatment of local and foreign investors, certain inequitable conventions are practiced with the foreign investors. Such inequalities are evident in cases of authorization necessities for foreign investment, barriers against capacity expansion, supplier’s credit, etc. B. Back up industry: Garments industry is the main foreign income source of Bangladesh, but we are not in good position as mentioned in above paragraphs. For raw materials of these garments we have to depend on another country, we could not create back up industries for this sector so past decades.

So we are always in tension for this sector. C. Monopoly market: Monopoly market is not at all good for business. For example at present China is enjoying monopoly market in electronics and mobile phone market in Bangladesh. Once upon a time City Cell was the only mobile phone company in Bangladesh. Then the use of cell phone was very limited due to high call rate and High package charge. Only few people could afford it. Then came Grameen phone in the Cell phone market, But still then the call charge was quite high 7 taka/min.

Then came Bangla link, Warid, Tele talk and Rabi (Alkatel) At that time monopoly market in cell phone market collapsed, people now can use any cell phone of any operator easily at a quite acceptable call rate. And business of all operator is expanding day by day. So competition market is good for business and users end (users have option) 9. Lack of efficient distribution channels: Bangladesh has one of the flattest land structures in the world. The lack of obstacles (hills, desert etc) and presence of cheaper transportation option (waterway) makes the country any supply channel manager’s dream.

But unfortunately the real picture is somewhat different. The businesses lose near 40% of the perishable items due to lack of efficient distribution channel. Lack of supply chain management knowledge, a weak transportation system, and corrupt road authorities are some factors that contribute to make the system inefficient. 10. Lack of necessary raw material Lack of necessary raw material is another problem. Everyone need run and run for raw materials. Here we don’t have a definite supply chain of raw materials and the producers. Entrepreneurs are ready to pay necessary money for it but there is no instable supply.

Sometimes there is nothing found when necessary, sometimes all are very high in price and sometimes adequate raw materials are in the market and it is more than necessary. 11. Skilled labor: Bangladesh may be the land of cheap labor but they are also unskilled. The training institutions are not sufficient to provide the quality labor force the businesses need. 12. Lack of proper business knowledge: Most of the entrepreneurs of Bangladesh apply the traditional hit and miss approach with their businesses. They have little institutional knowledge and have little access to training as very few organizations offer quality facility.

In absence of know-how relating to general accounting, branding, taxation, law etc the businesses tend to miss the opportunity that the regulatory environment offers. Internet can play a vital role here for knowledge dissemination but the access to the net is not that easy. 13. Lack of connectivity: The world has moved on to connect itself to the World Wide Web whereas Bangladesh is lagging far behind. Across the world innovative business are emerging using a clicks and mortar business model. They are leveraging the full potential of the World Wide Web.

As the access to high-speed internet connection becoming cheaper by the day around the world the story is quite different for Bangladesh. Businesses have to pay a handsome amount in fact one of the world steepest fees to get access to the web. But the scenario is changing in the consumer front. Consumers now have access to the web through their cell. There is a huge opportunity to cater to the foreign customers by displaying the product in the web. But the high-speed internet connectivity is yet to reach the acceptable standard. 14. Absence of realistic data;

For a proper business environment requirement of realistic data is very important. In Bangladesh perspective we are short of that both in public and private sector. For example we do not have data regarding requirement of demand of electricity for which we could not plan for production of electricity. Shortage of data sometime creates abnormal situation in our daily market life and our people can not make a plan for demand and supply. (Example: Price of commodity item, Rice, Oil etc). 15. Human Resource Management (HRM) The goals of HRM should not only be limited to ‘a shoulder to cry on’ for the employees.

The HRM of an organization should involve themselves in staffing, training and development, motivation and maintenance of the employees ‘If employers don’t give a chance to the young professionals in this line and if they don’t train them, then HR positions will be taken by other nationalities and thus it would be a big loss . 16. Internal management problems: From any giant company to a cottage shop good management is a must for success. Management people should know all the arts of management. There are some problems in management cases of Bangladesh, and for this reason ?-Cannot identify target market or target customer. -Does not plan. ?-Believes advertising is an expense not an investment. ?-Only primary knowledge of pricing policy and strategy. ?-Cannot identify trading area. ?-Cannot delegate. ?-Believes loan would solve every problem. All these problems are usually created by an unskilled management people. And it is it is more that skilled people are not available in the market. Management problems are: Suggestions: Here we are some suggestions that may be helpful to improve the Management sector in Bangladesh. ?As capital is the major problem for l Business development in Bangladesh special emphasis should be put here.

Commercial banks should finance Business by giving loan in low interest and for long term in easy way. ?Government should take proper steps to solve problems in the field of Coordination, Planning, and bureaucratic hassle. Red tapism must be abolished. Corrupted officials need to be punished and replaced. ?Political and social instability should be maintained. Terrorism must be sustained and keep under control. Most of our politicians are business men. So they should come in same platform for the betterment of their business and for the greater interest of the country. Govt should be in hard line to maintain law and order situation in the country at any coast. All politicians should help the Govt to wiped up the so called “Chadabaz” and “Mastan” ? For the development of the country there is nothing short cut without improving the utility services, especially in case of electricity. Govt has to plan for next decades not only for next one or two years. ?In the organizations there should be proper “Organizational behavior” to protect labor unrest and unseen problems from the employees. ?Training is a continuous process. It is an end less journey