The Politics of Strategy Choice by Jolito Ortizo Padilla

All organizations are political. Unless managed, political maneuvering consumes valuable time, subverts organizational objectives, divert human energy, and results in the loss of some valuable employees. Sometimes political biases and personal preferences get unduly embedded in strategy choice. Internal politics affect the choice of strategies in all organizations. The hierarchy of command in an organization, combined with the career aspirations of different people and the need to allocate scarce resources , guarantees the formation of coalitions of individuals who strive to take care of themselves first and the organization second, third or fourth. Coalitions of individuals often form around a key strategy issues that face an enterprise. A major strategists is to guide the development of coalitions, to nurture an overall team concept, and to gain the support of key individuals and groups of individuals.

In the absence of objective analyses, strategy decisions too often are based on the politics of the moment. With development of improved strategy formation tools, political factors become less important in making strategic decisions. In the absence of objectivity, political factors sometimes dictate strategies, and this is unfortunate. Managing political relationships is an integral part of building enthusiasm and esprit de corps in an organization.

A classic study of strategic management in nine large corporations examined the political tactics of successful and unsuccessful strategists. Successful strategists were found to let weakly supported ideas and proposal die through inaction and to establish additional hurdles or tests for strongly supported ideas considered unacceptable but not openly opposed. Successful strategists kept a low political profile on unacceptable proposals and strives to let most negative decisions come from subordinates or group consensus, thereby reserving their personal vetoes for big issues and crucial moments. Successful strategists did a lot of chatting and informal questioning to stay abreast of how things were progressing and to know when to intervene. They led strategy but did not dictate it. They gave few orders, announced a few decisions, depended heavily on informal questioning , a sought to probe and clarify until a consensus emerged.

Successful strategists ensured that all major power bases within an organization were represented in , or had access to , top management. They interjected new faces and new views into considerations of major changes. This is important because new employees and managers generally have more enthusiasm and drive than employees who have been in the firm a long time. New employees do not see the world the same old way ; nor they act as screens against changes. Successful strategists minimized their own political exposure on highly controversial issues and in circumstances in which major opposition from key power centers was likely. In combination, these findings provide a basis for managing political relationships in an organization.

Because strategies must be effective in the marketplace and capable of gaining internal commitment, the following tactics used by politicians for centuries can aid strategists:

• Equifinality- It is often possible to achieve similar results using different means or paths. Strategists should recognize that achieving a successful outcome is more important than imposing the method of achieving it. It may be possible to generate new alternatives that give equal results but with far greater potential for gaining commitment.
• Satisfying- Achieving satisfactory results with an acceptable strategy is far better than failing to achieve optimal results with an unpopular strategy.
• Generalizations -Shifting focus from specific issues to more general ones may increase strategists' options for gaining organizational commitment.
• Focus on Higher Order Issues- By raising an issue to a higher level, many short term interest can be postponed in favor of long term interests. For instance , by focusing on issues of survival , the airline and automotive industries were able to persuade unions to make concessions on wage increases.
• Provide Political Access on Important Issues- Strategy and policy decisions with significant negative consequences for middle managers will motivate intervention behavior from them. If middle managers do not have an opportunity take a position on such decisions in appropriate political  forums, they are capable of successfully resisting the decisions after they are made. Providing such political access provides strategists with information that otherwise might not be available and that be useful in managing intervention behavior.

Copyright Infringement is Punishable By Law

 

The Balance Between Order and Flexibility by Jolito Ortizo Padilla

My Prayers to all victims of Typhoon Yolanda that devastated Leyte and Samar recently.

The delayed distribution and implementation of help and support to the victims of Typhoon Yolanda in Southern Visayas does not match power with involvement. It is a bastion of failure by the proper authority to respond immediately to the needs of survivor.

 Etzioni provides a classification of organizational relationships based on structures of control and the use of power resources as a means of ensuring compliance among members. Compliance is the relationship between the kinds of power applied by the organization to control its members and the kind of involvement developed by members of the organization.

Power differs according to the means by which members of the organization comply

• Coercive Power relies on the use of threats, or physical sanctions of force, for example, controlling the need for food and comfort.
• Remunerative power involves the manipulation of material resources and rewards, for example through salaries, wages and overtime pay.
• Normative power relies on the allocation and the manipulation of symbolic rewards , for example, esteem and prestige.

Involvement is the degree of commitment by members to the organization
  

•  Alienative involvement- occurs where members are involved against their wishes.
• Calculative involvement occurs where attachment to the organization is motivated by extrinsic rewards. There is either a negative orientation or a low positive orientation towards the organization.
• Moral Involvement is based on the individual's  belief in , and value placed on , the goals of the organization. There is a high positive orientation towards the organization.  

The matching of these kind of power and involvement is congruent with each other and represents the most common form of compliance in organization. The other six types of organizational relationships are incongruent. Padilla suggests that organizations with congruent compliance structures will be more effective than organizations with more incongruent structure.

Stewart refers to the classic dilemma that underlies the nature of control; finding the right balance for present conditions between order and flexibility. This involves the trade off between trying to improve predictability of people's actions against the desirability of encouraging individual and local responsiveness to changing situations. The organization may need a "tight -loose " structure with certain departments or areas of work closely controlled (tight) while other departments or areas of work should be left fluid and flexible("loose")

According to Jolito Ortizo Padilla control can- and should - be exercised in different ways. He identifies three main forms of control:

•  Direct control by orders, direct supervision and rules and regulations. Direct controls maybe necessary , and more readily acceptable, in crisis situation. But in organizations where people expect to participate in decision-making , such forms of control may be unacceptable. Rules and regulations which are not accepted as reasonable or at least not unreasonable, will offer some people a challenge to use their ingenuity in finding ways round them.

•  Control through standardization and specialization. This is achieved through clear definition of inputs to a job , the methods to be used and the required outputs. Such bureaucratic control makes clear the parameters within which can act and paradoxically makes decentralization easier. Provided the parameters are not unduly restrictive they can increase the sense of freedom. For example , within clearly defined limits which ensure that one retail chain looks like another, individual manager may have freedom to do the job as they wish.

• Control through influencing the way that people think about what they should do. This is often the most effective method of exercising control. It may be achieved through selective recruitment of people who seem likely to share similar approach, through the training and socialization of people into thinking the organization's way, and through peer pressure. Where an organization has a strong culture , people who do not fit in, or learn to adapt, are likely to pushed out, even though they may appear to leave their own volition.

As Padilla says: " The broad objective of the control function is to effectively enjoy all the resources committed to an organization's operations. However, the fact that non-human resources depend on human effort for their utilization makes control, in the final analysis, the regulation of human performance."

 

 

 

Copyright Infringement is Punishable by Law

The Philippines Business Climate by Jolito Ortizo Padilla

Philippines is a highly educated English speaking country, the Philippines overtook India in  early 2011 in call center jobs, employing 350,000 compared with India's 330,000. Call centers in the Philippines produced $7.4 billion in revenue in 2011, and that figure is growing about 15 percent annually. The Philippines recently overtook Indonesia as the world's biggest supplier of voice-based call center services. Citigroup and Chase are just two companies outsourcing customer calls , back office work, and other operations to the Philippines. A major reason why the Philippines is an attractive place for call centers is the country's overall culture " to deliver absolutely fantastic service". An associate professor at the City University of Hongkong , John Lockhead , says "Filipinos go out of their way, not just in call centers, but in tourism and events management, to ensure people are well looked after.

The Philippines has about 98 million people, making the country the world's largest in population. Located in Southeast Asia , the Philippines was a founding member of the United Nations and is very active in that organization. Filipinos love Americans who rescued them in WW11. Thousands of Filipinos today work all-night shifts to accomodate normal 8 am to 5 pm business time zone in the United States.

Unemployment is at 6.9 percent in the Philippines , but underemployment -defined as people who work only part time or with minimal incomes - is 18 percent. The average capita income of Filipinos is about $1,790 a year , so hundreds of thousand of Filipinos work outside the country. In fact  , the Philippines economy depends greatly on outside workers sending money back to the country and also travelling to and from the country.

The television advertising market in the Philippines is nearly $4 billion annually , larger than India's and on par with Indonesia's . Television is the most enjoyed media among the Philippines 7,100 island people, whereas newspapers are the most important media outlet in India. Television ads comprise 75% of advertising spending in the Philippines.

Among major emerging economies, the Philippines has only a 9 percent Internet penetration rate among its population, which is very low compared to China (28.9%) , Nigeria (28.4%), Mexico (28.3%) , and Russia (29.0%) . But the Philippines' 9 percent rate is above the Internet penetration rate among Indonesia's population (8.7%) and India's population (5.1%). These percentages reveal the percentage of the country's people that could shop online.

                                            Copyright Infringement is punishable by Law.

On Non Verbal Communication and Body Language by Jolito Ortizo Padilla

 

The significance of non-verbal communication and body language includes inferences drawn from posture, gestures, touch, invasions of personal space , extent of eye contact , tone of voice or facial expression.People are the only animal that speak, laugh and weep. Actions are more cogent than speech and humans rely on body language to convey their true feelings and meanings. It is interesting to note how emotions are woven creatively into email messages. Using keyboard signs in new combinations has led to new e-language- to signal pleasure :), or unhappiness:-c, or send a rose -{---@ encapsulates feelings as well as words. The growth of this practice has led to an upsurge of web pages replete with examples.

According to Padilla , in our face to face communication with other people the messages about our feelings and attitudes come only 7 percent from words we use, 38 percent from our voice and 55 percent from body language, including facial expressions. Significantly, when body language such as gestures and body tone of voice conflicts with the words, greater emphasis is likely to be placed on the non verbal message.

Although actual percentages may vary, there appears to be general support for this contention. According to Pivcevic, "It is commonly agreed that 80 percent of communication is non-verbal; it is carried in your posture and gestures , and in the tone, pace and energy behind what you say. McGuire suggests that when verbal and non verbal messages are in conflict, "Accepted wisdom from the that the non verbal signals should be the ones to rely on, and what is not said is frequently louder than what it said, revealing attitudes and feelings in a way words can't express."

Padilla suggests that in a sense , we are all experts in body language already and this is part of survival instinct:

"Even in  a safe environment like an office or meeting room you will feel a pull on your gaze each time someone new enters the room. And whatever you want to or not, you will start to form opinions about a person in as little as three seconds. You can try to be fair and objective in your evaluation, but you will have a little choice. This is an area where the subconscious mind bullies the conscious into submission. Like, dislike, trust , love or lust can be promoted in as long as it takes to clear your throat. In fact most of these responses will be based on your perception of how the person looks."

In our perceptions and judgement of others it is important therefore to watch and take careful note of their non verbal communication,. Managers should also be aware of the subconscious message that their own body language conveys to member of staff. For example, Kennett points out that we take signals from our leaders and if managers are inhibiting signs of anxiety their body language and critical talk will amplify employees' susceptibility to stress. However, although body language may be a guide to personality , errors can easily arise if too much is inferred from a single message rather than a related cluster of actions. Consider the simple action of handshake and the extent to which this can provide a meaningful insight into personality. Does a firm handshake by itself necessarily indicate friendship and confidence? And is a limp handshake a sign of shyness or lack of engagement with the other person? According to Fletcher, " You won't learn to interpret people's body language accurately, and use your own maximum effect, without working at it. If you consciously spend half an hour a day analyzing people's subconscious movements, you'll soon learn how to do it-almost unconsciously. However, as Padilla points out, with a little knowledge about the subject it as all too easy to become body conscious.Posture and gesture can unmasked deceivers, but it would be dangerous to assume that everyone who avoid eye contact or rubs their nose is a fibber.

According yo Akehurst the advice to anyone trying to spot a liar is simple. "Close your eyes. Don't look at them. Listen to what they are saying . Non verbal cues are very misleading and we use too many stereotypes.

The reality is body language is not a precise science. One gesture can be interpreted in several ways. It may be a possible indication of a particular meaning but by itself cannot be interrupted with any certainty. Crossing your arms is often taken as a sign of defensiveness but could equally mean that the person is cold or finds this a comfortable position.

Despite these limitations, it is essential that managers have an understanding of non verbal communication and body language and are fully cognisant of the possible messages they are giving out.

" All things are not what it seem. The ability to work out what is really happening with a person is simple- not easy, but simple. It's about matching what you see and hear to the environment in which it all happens and drawing possible conclusions. Most people , however, only see the things they think they are seeing"- Jolito Ortizo Padilla

  

Coping With Stress by Jolito Ortizo Padilla

 

 

There are a number of measures by which individuals and organizations can attempt to reduce the causes and harmful effects of stress. There are also many suggested techniques to help individuals bring stress under control- for example changing one's viewpoint , identifying causes of distress  effective time management, expanding one's social network laughing and telling jokes, relaxation training, working on stress reduction and appreciating that some stress can be useful. However, there are not always easy remedies for stress and much depends upon the personality of the individual. Techniques such as relaxation therapy may help some people , although not others , but still tend to address the symptoms rather than the cause.

Dr. Justin Luzuriaga Padilla, Internist/Cardiologist/ Surgeon of Mayo Clinic point out, stress inducing hazards are hard to pin down , much less eliminate. It is important to know how people feel about the things that cause them stress as well as which "stressors" are most common in the industry and occupation. Human resource policy should include several stress management building blocks within the organization structure including management education , employee education, counselling and, critical incident briefing and good sound management.

Effective two way communications at all levels of the organization are clearly important in helping to reduce or overcome the level of stress, Staff should feel able to express their true feelings openly and know they will be listened to. However to good communications, Padilla refers to the importance of conversation for maintaining relationships and suggests a case of  a conversation culture. The ability to hold a good quality conversations is becoming a core organizational and individual skill.  Unlike communication, conversations are intrinsically creative and and roam freely across personal issues, corporate gossip and work projects. Conversations are a defense against stress and other mental health problems. People with good social relationships at work are much less likely to be stressed or anxious.

A growing number of organizations are introducing an email-free day to encourage staff to use the telephone or walk across the corridors to talk more with one another. Informing members of staff in the first place about what is happening especially at times of major change, involving them proactively in the change process , and allowing people to feel control and exercise their own discretion reduces uncertainty and can help minimize the potential for stress.

Managers can do much to create a psychologically supportive and healthy work environment. Treating people with consideration , respect and trust, giving full recognition and credit, getting to know members of staff s individuals, and place emphasis on end results can all help to reduce stress. Managers should attempt to be role models and through their language and body language indicate to others that they are dealing effectively with their own work pressures.

As part of its "Fit for Work, Fit for Life, Fit for Tomorrow" strategic programme , the GA Consultancy is working with businesses on health issues , including work related stress , to enable them to  be managed effectively in the workplace. With input from a range of businesses, professional bodies and trade unions, the GA Consultancy has developed a new approach to tackle this problem. The Management Standard for work related Stress encourage employers and employees to work in partnership to adopt agreed standards of good management practice to prevent stress at an organizational level.

The adoption of the the Management Standards is a key element in bringing about reductions in worker ill-health absence. The standard provide a framework that allows an assessment to be made about a degree of exposure to six key areas of work design-demands, control, support, relationships, role and change-that , if not properly managed are associated with poor health and well being, lower productivity and increased sickness absence.

Another interesting approach to reducing stress is through the use of the Japanese Kaizen principles. Applying the Kaizen 5S method translated to English as sort, straighten, shine, standardise and sustain can help increase efficiency and productivity m raise morale and lower an individuals stress level. "The busier you are the tidier your desk should be; that is if you wish to get ahead and deliver more with less stress.

 

The Immaculate Heart of  Mary Stands Above the Ruin

                                           Copyright Infringement is Punishable by Law

Consumer Rights: Economic Torts...by Jolito Ortizo Padilla

 

Defining Torts is not an easy matter and one has to be careful not to define it broadly so as to encompass matters other than torts or define it narrowly so as to exclude some torts. Two contrasting definitions of tort are offered; one by Salmond, the other by Professor Winfield. They represent different school of thoughts:

Salmon defines a tort as " a civil wrong for which the remedy is a common law action for unliquidated damages , and which is not exclusively the breach of a contract or a breach of trust or other merely equitable obligation.

The late Professor Winfield contended that" all tortious  liability arises from the breach of a duty primarily fixed by law; such duty is towards persons generally, and its breach is redressable by an action for unliquidated damages.

Both these definitions refer to unliquidated damages. Damages are unliquidated when they are not predetermined or pro-estimated (as they are, for example, in an action in contract to recover a debt) but are determined at the absolute discretion of the court.

One school maintains that there is a "law of torts" which consists of a number of specific torts and to succeed in an action you must show that the alleged wrong falls within the scope of one or more torts. The other school maintains that there is a "law of tort" (not torts) based on a general principle of liability and all harm is actionable per se  unless the defendant can show a just cause or excuse. There are no inherent contradictions between the two school of thought as both accept the new categories of torts may be created and the existing law can be expanded to bring new wrongs within its confines. As Professor Glanville Williams puts it: To say that the law can be collected into pigeon- holes does not mean that those pigeon-holes may not be capacious , nor does it mean that they are incapable of being added into.

There is a large number of recognized and listed torts and these will be looked at individually like negligence, liability of occupiers of premises, strict liability, trespass to property, nuisance, defamation, and miscellaneous torts of conspiracy, deceit and injurious falsehood.

However, we may focus on the Miscellaneous torts which we described as economic torts , in that their effect is to harm the plaintiff economically. They maybe listed as conspiracy, deceit or fraud and malicious or injurious falsehood.

Conspiracy
This tort is committed when two or more persons intentionally and without lawful justification combine together to injure the plaintiff , or do unlawful acts that result in injury to the plaintiff. To succeed in an action the plaintiff must prove that the predominant purpose of the defendants was to combine together unlawfully to cause him economic damage. If , however the defendants had combined together to further their own interests, e.g. to defend the interests of the union members, and economic damage was a consequence , no action for conspiracy will succeed. In Crofter Hand Woven Harris Tweed Co. Ltd. vs. Veitch (1942) it was held that the action of the members of a union to refuse to load cheaper tweed made from mainland yarn in order to protect the member's interest was not a conspiracy to inflict damage on the plaintiffs, If overall objective of a combination is put forward or defend the trade of those who enter into it then no wrong results despite damage to the plaintiff (Sorrel vs. Smith, 1956).

Deceit or Fraud
This tort is committed when a person acts to his detriment relying on a fraudulent misrepresentation of another. The essential requirements are a false representation is made which must be a statement of fact, the person making the representation knows it to be false or does not believe it to be true or is reckless about it, not caring whether it is true or false, misrepresentation is intended to be acted upon and the person to whom the misrepresentation is made has acted upon it.

Injurious falsehood
Whereas in deceit and defamation damage is done to a plaintiff's reputation , in injurious falsehood a tort is committed against the plaintiff's business interest. An injurious falsehood is a false statement , made maliciously about a plaintiffs business interests whereby other persons are deceived, thereby causing damage to the plaintiff. The word "maliciously" means "from improper motive". Types of injurious falsehood are as follows:

• Slander of title and goods. This arises when doubts are cast through the action of the defendant on the plaintiff's title to real or personal property, patents and copyrights, the quality of his goods or products. (Wren vs. Weild, 1948). According to the Defamation Act , 1952, no special damage need to be proved by a plaintiff in an action for malicious falsehood. Puffs and mere sales talk in general terms , although untrue, may not be injurious falsehood e,g, to say your products are superior quality to those of your competitors. The test is that if a reasonable man takes a statement seriously it is slanderous. (De Beers Abrasive Products Ltd. vs. International Electric Co. of New York Ltd, 1975)
• Slander of plaintiff;s trade or business. It is actionable to imply in a newspaper or other published material that a plaintiffs has gone out of the business with the result that the plaintiff's trade suffer. (Radcliffe vs. Evans, 1907)
• Passing off. This consists of a deliberate act of the defendant to mislead others into believing that the defendant's goods are those of the plaintiff. In doing so the defendant takes on unfair advantage of the plaintiff's trade or business. The tort may take the form of a statement that the business of the plaintiff is the defendant, Marketing under the plaintiff's trade name, using the plaintiff's trademark especially unregistered trade marks, since statutory protection is given to registered trademarks under the Trade Marks Act, 1938 and the trademarks amendment Act 0f 1984 and imitating the presentation or appearance of the plaintiff's goods (J Bollinger vs, Costa Brava Wine Ltd. , 1960).

The remedies for torts of this kind are injunctions to restrain the falsehood or unfair practice and/images. Damages will reflect not only the economic loss (if any) suffered, but also compensation for loss of reputation and ill-will caused by the behavior of the defendant in misleading potential customers.

                                           Copyright Infringement is Punishable by Law

A Series of Consumer Rights: Misrepresentation

Representations are statements made in order to induce party to enter into a contract. They differ from conditions or warranties in that they do not form a part of the contract themselves. However, they are extremely important, for without such representations the contract might not be entered into at all. They may distinguished from mere puffs, which are statements made in the course of the negotiations which are intended but by then the practice  to be taken seriously but are recognized by both parties as being mere hyperbole (exaggeration for the sake of effect). Thus to say that a horse is "the finest creature on four legs today " is a mere puff, and not intended to lead a legal action should the other party find a finer animal. A representation does lead to legal action. A misrepresentation is a false statement made in the course of negotiations leading to a contract which was intended to induce, and did induce , the other party to enter into that contract.

 As a general rule , there must be a positive statement; this is often expressed by saying that "silence is not a misrepresentation". This was shown in the case of Keates vs. Lord Cadogan (1921) . Here a landlord was held not liable when he failed to inform a tenant that the house being let was in dilapidated condition-even though he knew that it was required for immediate occupation. In some circumstances this rule operates unjustly , and the courts have long recognized exceptions to it.

 When the silence distorts or falsifies a positive representation. Thus if the vendor of land states that the farms are let , he must not  omit to state the further fact that the tenants have given notice to quit. This is illustrated by Dimmock vs. Hallet (1966).

A vendor of farms induced their sale by saying that they are let. Whilst this was true the statement was held to be misrepresentation because the tenants had given notice.

The principle also applies even if the original statement was full and correct., but subsequent events make it incorrect:

With vs. O' Flanagan (1955). In January 1955 a medical practice was represented to the plaintiffs by the doctor selling it as worth $2000 per annum. In May 1952, the plaintiff contracted to buy , but by then was producing less than $5 per week due to the illness of the defendant). The court of Appeal held that duty to disclose  had been broken -rescission of the contract was allowed, and to defendant had to repay.

The statement need not be expressed in words, but can be made by conduct. Thus it could be "a nod" or a wink" or a shake of the head or a smile.

The statement must be one one of fact and not of law , opinion, or intention. However, if a person expresses an opinion fraudulently, this is regarded as a statement of fact and therefore actionable. Here we can contrast  the cases of Biset vs. Wilkinson (1957) and Smith vs. Land and House Property Corporation (1959)

The appellant sought to recover the purchase money under the agreements for the sale of certain land but the respondents claimed to be entitled to rescind the contract on the ground of misrepresentation. It was shown that the appellant had stated that it was his belief that the land in question would carry 2000 sheep of property worked but in fact it had never been able to support that number. The contract would not be rescinded on the ground of misrepresentation as the statement as to carrying capacity of the land was merely an opinion which the appellants honestly entertained. (  Cracknell"s Law Students' Companion)

In similar fashion a fraudulent statement of intention can lead to misrepresentation:

Edginton vs. Fitzmaurice (1907), The directors of a company issued a prospectus inviting subscriptions for debentures and stating that their purpose in issuing debentures was to complete alterations to the company's premises, purchase horses and vans develop trade. The plaintiff advanced money on certain of these debentures in reliance upon the statements in the prospectus and in the erroneous belief that the real object of the loan was to enable the directors to pay off the pressing liabilities. The mis-statement of the objects for which the debentures were issued was a material mis-statement of fact which rendered the directors liable in deceit although the plaintiff was influenced by his own mistake as to effect of the transaction. (Cracknell's Law Students' Companion).




                                       Copyright Infringement is Punishable by Law

        

Developing Emotional Intelligence by Jolito Ortizo Padilla

Emotional Intelligence is the sum of a range of interpersonal skills that form the public persona. Emotional Intelligence has received a considerable attention over the last few years as the concept has been identified as a key aspect of managing people effectively.Goleman argues for a more emphatetic style of management and suggests that Emotional Intelligence predicts top performance and accounts more than 85 percent of  outstanding performance in top leaders. The Hay Group,working with Goleman have identified 18 specific competencies that make up four components of emotional intelligence and have produced an inventory designed to measure emotional competence. The Emotional Competency Inventory defines EI as "The capacity for recognizing our own feelings and those of others, for motivating ourselves and for managing emotions within ourselves and with others."

Recognizing and understanding the implications of emotions and being able accurately to self-assess one's inner resources, abilities and limits are key to becoming an emotionally intelligence leader. Being able to read emotional currents is an important skill for managers to develop and employ. It requires them to understand the individuals within their teams and the way in which individuals relate and interact.

Recent research by GA Business and Management Consultancy identifies Emotional Intelligence as one of the key skills managers and leaders will need in the coming decade. According to Padilla it should really be no surprise to find Emotional Quotient so much in demand.

" After all, we will work in structure which are much flatter than ever. We have to be much faster on our feet with both colleagues and clients and, whatever the team structure ,there is increasing proximity for us to build the relationships we need-fast. In this context EQ is the glue that holds people and teams together. "

Jolito Ortizo Padilla refers the importance of empathy in EI which both involves how a person self manages and addresses how to engage with the emotions of others, and suggests a six -step process for developing EI.

- Know what you feel.
- Know why you feel.
- Acknowledge the emotion and know how to manage it.
- Know how to motivate yourself and make yourself better.
- Recognize the emotions of other people and develop empathy.
- Express your feelings appropriately and manage relationships

There seems little doubt that managers and leaders who have trained up in EQ have far more initiative in dealing with organizational life than those who don't. Stress will always exist at work , but EQ gives people the tools and ways of thinking to manage it to their advantage.

A number of steps in raising emotional intelligence are also suggested by Garrett, including ensuring staff are managing their interpersonal relationships before a problem arises,focusing first on leaders and creating an EQ culture for the organization about itself and the companies it deals with. According to Dann ,becoming highly self aware allows and individual to recognize inner and outer conflict and develop more proactive self management . Developing greater  social awareness allows the fostering of productive relations and a greater degree of engagement between employees and management. A manager with a high EQ benefits both
organization and the individual.

                                                     Copyright Infringement is Punishable by Law      

The World of Work and Management in 2018 by Jolito Ortizo Padilla

 

A major study by the GA Management and Consultancy" ,including a survey of 1,000 senior executives,has investigated how the world of work and management will look in 2018.Among the key findings are that:

 " The working population will be more diverse. Changing expectations of work and the impact of new technologies will require managers and leaders to develop a range of skills that focus on emotional and spiritual intelligence,judgment and the ability to stimulate creative thinking to improve productivity."

Among the recommendations to leaders and managers are the needs to focus on individual employees and their need when developing technologies; make organizations more human; and motivate people creatively.

" A greater degree of emotional intelligence will be required by managers,so that they can understand how people work and their likely reactions to change. They will also benefit from having the humility to accept that they are not always the one appropriate ideas".

According to Cloke and Goldsmith :Managers are the dinosaurs of our modern ecology. The age of management is finally to a close. Cloke and Goldsmith suggest that the ever extending reach of globalization,continuously rising productivity,growing complexity of information, expanded sensitivity of the environment and swelling pace of technological innovation are all increasing the demand for alternative organizational practices. They contend that management is an idea whose time is up. Organizations that do not recognize the need to share power and responsibility with all their workers will lose them. The most significant trends in the theory and history of management are the decline of hierarchical ,bureaucratic , autocratic management and the expansion of collaborative self management and organizational democracy.

Hamel maintains that the environment facing the 21st century businesses is more volatile than ever and questions how tomorrow's successful companies will be organized and managed. These new realities call for a new organizational and managerial capabilities.

While the familiar tools and methods of modern management were invented to solve the problems of control and efficiency in large scale organizations, we can envisage management as serving a more general objective: multiplying human accomplishment. In a sense , the goal of management is to first amplify and then aggregate human effort -to get more out of individuals than one might expect by providing them with the appropriate tools,incentives,and working conditions,and to compound those efforts that allow human beings to achieve individually.

There is much written today about changes in the workforce and new approaches to management. It is interesting to note, however,the ideas on the nature of managerial behavior put forward over seventy years ago by Mary Parker Follet. Her thinking was based on concern for social, evolutionary progress , and the organization and management of people for effective performance and the fuller life. Follett envisioned the successful operation of groups, and management responsibility diffused through the organization and not just concentrated at top of hierarchy. One of her notable contributions was emphasis on the situational approach as one of the main forces in influencing the manager-subordinate relationship through the depersonalizing of orders and obeying the "law of the situation".

Parker suggests that Follet's ideas on human relations in the workforce foreshadowed the state of things to come and continue to offer managers in the new century fresh food of thought. Her proposals for best management practice have not only reflected much of what is portrayed as new today but offer managers fresh insight into task of leadership and management.

The fact that management ultimately depends on an understanding of human nature, I suggest it goes much further than that. In the first place , good management depends on the acceptance of certain basic values. It cannot be achieved without honesty and integrity, or without consideration for the interests of others. Secondly, it is the understanding of human foibles that we all share, such as jealousy, envy, status, prejudice, perception, temperament, motivation and talent, which provides the greatest challenge to managers.

                                             Copyright Infringement is punishable by Law

 

The Concept of Empowerment by Jolito Ortizo Padilla

                                       
Despite the general movement towards less mechanistic structures and the role of managers as facilitators,there appears to be some reluctance especially among top managers to dilute or weaken hierarchical control.A study of major US businesses suggests that there are mixed reactions to the new wave of management thinking. While a prospect of empowerment can hold attractions for the individual employee,many managers are keen to maintain control over the destiny,roles and responsibilities of others. Beneath the trappings of the facilitate and empower philosophy the command and control system lives on.However ,in a discussion on modern leadership and management,Gretton makes the point: " Today's leaders understand that you have to give up control toget results. That's what all the talk of empowerment is about."

Empowerment is generally explained as allowing employees greater freedom autonomy and self-control over their work ,and responsibility for decision making. However, there are differences in the meaning and interpretation of the term. Wilkinson refers to problems with existing prespective literature on empowerment. The term "empowerment" can be seen as flexible and even elastic,and has been used very loosely both practitioner and academics. Wilkinson suggests that it is important to see empowerment in a wider context.It needs to be recognized that its has different forms and should be analyzed in the context of broader organizational practice.

The concept of empowerment also gives rise to the number of questions and doubts. For example, how does it differ in any meaningful way from other earlier forms of employee involvement? Is empowerment just another somewhat more fanciful term for delegation? Some writers see the two as quite separate concepts while other writers suggest that empowerment is a more proactive form of delegation.

Padilla suggests that to support true empowerment there is a need for a new theory of management- Theory E-which states that managers are more effective as facilitators than as leaders,and that they must devolve power, not just responsibility,to individuals as well as groups. Morris, Willcocks and Knasel believe, however,that to empower people is a real part of leadership as opposed to management and they give examples of the way empowerment can actually set people free to do the jobs they are capable of. Both make the point,however ,that true empowerment is much more than conventional delegation.

According to Mills and Friesen: "Empowerment can be succinctly defines as the authority of subordinates to decide and act. "
 
  "It descends a management style. The term is often confused with delegation but, if strictly defined, empowerment goes much further in granting subordinates authority to decide and act. Indeed,within the contaxt of broad limits defined by executives,empowered individuals may even become self- managing."

The Power of Self Concept..by Jolito Ortizo Padilla

Self Concept is the way in which a person sees him-or herself and thinks that others see him or her. An individual with a strong self concept is able to view his or her own abilities in a positive way. Such people do not have to turn to others for affirmation within themselves. A positive self concept results in a person self confidence necessary to deal with others in a professional and productive manner. Customer service providers must work to develop a positive self concept. Angry customers may take out their frustrations on the person who is trying to assist them in finding resolutions to their problems. When this happens ,it would be easy for an individual with a poor self concept to take the customers' words or actions personally. A positive self concept creates the armor necessary to keep customers' actions in perspectives.

Unfortunately, many people do not have a positive self concept. Society places a number of unrealistic examples of perfection before us. The media continue to show us that in order to be truly happy we must be attractive, tall ,thin ,witty,affluent, and perfect in every way. How can we interact with the world in a positive manner if we are less than what we see as ideal? This is a challenge that faces most people.

Others are not influenced by the example that the media have established but have been surrounded by negative people. Negative people can only chip away at an individuals' self concept. If someone tells me that I am not good ,why shouldn't I believe them? The most important thing that people with less than positive self concept can do is to realize that they alone have to power to change the way that they see themselves.

Every individual has the ability to improve his or own self concept. While others can affect how individuals see themselves,change must begin within the individual. The first step in improving oneself is to perform self assessment. A self assessment is an individual evaluation in which individual strengths and weaknesses are identified. A self assessment helps individual to determine where they are headed if they make no changes in themselves or in their behavior. A self assessment must be performed honestly and is meant to evaluate the individual. Instances in which individuals believe that they have been overlooked or have experiences "bad luck" are not relevant during a self assessment. Excuses and blame do not contribute to the performance of an accurate self assessment.

To begin performing self assessment, ask yourself the following questions and record your answers on the sheet of paper or on your computer:

1. What are my strengths? What do I receive compliments from others for having done well. What do I think I am good at?
2. What are my weaknesses? What activities do I feel less confident in performing? Do I frequently make excuses or blame others for my failures? Do I finish what I start? Do I say yes too often? Do I pull my weight in a group activity?
3. How do I see myself? Am I dependable? Do I speak well in front of others? How is my sense of humor? What do I like most about myself? What do I like least? If I could change one thing about myself, what would it be?
4. Do I establish goals and work toward achieving them? Do I take pride in successfully accomplishing task?

It is not enough to perform a self assessment. After assessment, the individual must evaluate the recorded information. When evaluating ,it is helpful to draw conclusions and to develop a plan for the future. Review the responses that you recorded as you performed your own self assessment. Are there specific areas in which you are pleased with your responses? As you draw conclusions about your strengths and weaknesses, recognize that the future will be much more productive if you consider your strengths and weaknesses in establishing goals.

Even if you are not entirely pleased with the outcome of your self appraisal, you now have a valuable new information about yourself. Most people have a very little self awareness because it is sometimes difficult to recognize who are and how others see us. It is much easier to make excuses for our failures and to blame our circumstances on someone else. Do not dwell on any negative information that your self appraisal may have revealed. Go forward making goals to emphasize the positive aspects of yourself and exploring ways to improve those areas that need improvement. Above all accept yourself as the unique person that you are.

Copyright Infringement is Punishable by Law

Managing Resistance to Change by Jolito Ortizo Padillla

No organization or individual can escape change.But the thought of change rises anxieties because people fear economic loss, inconvenience,uncertainty, and a break in normal social patterns. Almost any change in structure, technology, people, or strategies has a potential to disrupt comfortable interaction patterns. For this reason. people resist change.The strategic management process itself can impose major changes on individuals or processes. Reorienting an organization to get people to think and act strategically is not an easy task.

Resistance to change can be considered the single greatest threat to successful strategy implementation. Resistance regularly occurs in organizations in the form of sabotaging production machines, absenteeism, filing unfounded grievances, and an unwillingness to cooperate. People often resist strategy implementation because they do not understand what is happening or why changes are taking place. In that case, employees may simply need accurate information. Successful strategy implementation hinges upon managers' ability to develop an organizational climate conducive to change. Change must be viewed as an opportunity rather than as a threat by managers and employees.

Resistance to change can emerge at any stage or level of the strategy -implementation process. Although there are various approaches for implementing changes, three commonly used strategies are a force change strategy, and educative change strategy, and rational or self interest change strategy. A force change strategy involves giving orders and enforcing those orders; this strategy has the advantage of being fast, but it is plagued by low commitment and high resistance. The educative change strategist is one that presents information to convince people of the need for change; the disadvantage of an educative change strategy is that implementation becomes slow and difficult. However, this type of strategy evokes greater commitment and less resistance than does the force changes strategy. Finally a rational or self interest change strategy is one that attempts to convince the individuals that  the change is to their personal advantage. When this appeal is successful , strategy implementation can be relatively easy.However, implementation changes are seldom to everyone advantage.

The rational change strategy is the most desirable, so this approach is examined a bit further. Managers can improve the likelihood of successfully implementing change by carefully designing change efforts. Jack Duncan described a rational or self- interest change strategy as consisting of four steps. First, employees are invited to participate in the process of change and in details of transition; participation allows everyone to give opinions, to feel a part of the change process , and to identify their own self interest regarding the recommended change. Second,some motivation or incentive to change is required.; self interest can be the most important motivator. Third communication is needed so that people can understand the purpose for changes.Giving and receiving feedback is the fourth step: everyone enjoys knowing how things are going and how much progress is being made.

Because of diverse external and internal forces, change is a fact of life in organizations. The rate, speed , magnitude, and direction vary over time by industry and organization. Strategists should strive to create a work environment in which change is recognized as necessary and beneficial so that individuals can more easily adapt to change.Adopting a strategic management approach to decision making can itself require major changes in the philosophy and operations of a firm.

Strategists can take a number of positive actions to minimize managers' and employees' resistance to change. For example, individuals who will be affected by a change should be involved in the decision to make the change and in decision about how to implement the change. Strategists should anticipate changes and develop and offer training and development workshops so that managers and employees can adapt to those changes. The strategic management process can be described as a process of managing change.

Organizational change should be viewed today as a continuous process rather than as a project or event. The most successful organizations today continuously adapt to changes in the competitive environment, which themselves continue to change at an accelerating rate.It is not sufficient today to simply react to change.Managers need to anticipate change and ideally be the creator of change. Viewing change as a continuous process is in stark contrast to an old management doctrine regarding change , which was to unfreeze behavior , change the behavior , and then refreeze the new behavior. The new "continuous organizational change" philosophy should mirror the popular "continuous quality improvement philosophy".

                                           Copyright Infringement is punishable by law

       

The Concept of Fiscal Policy by Jolito Ortizo Padilla

Managing the economy is a complex task. The annual budget, which is the most important statement of fiscal policy , is eagerly awaited and attracts much media attention as the overall outcome is a very clear indicator of the state of the economy.In this statement , the Finance Minister outlines the government's spending and taxation plans for the year ahead.The direction taken in the budget should give a clear indication of the government's macroeconomic priorities.

In principal, there are three types of budget:

1. Budget Deficit -in this situation, projected government spending exceeds projected revenue from many forms of taxation.This is where the government sees the need to reflate the economy by increasing aggregate demand. Normally this is in response to a situation where there is a need to expand the economy in order to create more jobs and income.
2. Budget Surplus- in contrast ,this describes a budget where government revenue from taxation exceeds the projected expenditure by the government on social protection, health, care, education , transport and so on. Here the government has identified a need to deflate has identified a need to deflate the economy by cutting back aggregate demand.This is normally in response to a situation where the rate of inflation in the economy is higher than the government feels to be appropriate. It could also be in response to a deteriorating deficit in the balance of trade.
3. Balance Budget- as its name suggests, this is a neutral situation where projected revenue and government spending are equal. Within the budget though there is likely to be some re-allocation of taxation and expenditure.

As seen in the different types of budget, a government can deliberately alter tax rates and levels of government spending to influence economic activity.This is referred to as discretionary fiscal policy and can be used to influence aggregate demand. If a government wants to raise aggregate demand it will increase its spending or cut tax rates.Keynesians favor raising government spending because they believe this will have a bigger multiplier effect.This is because the rise in government spending,especially if it is on welfare payments, is most likely to benefit the poor who have a high marginal propensity to consume. In contrast, a cut in a tax rates may benefit mostly the rich who tend to have a low marginal propensity to consume.

A government can also allow automatic stabilizers to influence economic activity. These are forms of government spending and taxation which change, without deliberate government action to offset fluctuations in GDP. For example,during a recession government spending on unemployment benefits automatically rises because there are more unemployed people. Tax revenue from income tax and indirect taxes will in contrast fall automatically as incomes and expenditure decline.

Fiscal policy may also be employed to affect aggregate supply by changing incentives facing firms and individuals.In recent years , governments throughout the world have increasingly been using fiscal policy in this way to improve the competitiveness of their economies.

For fiscal policy to be effective it is important that the government can accurtaely estimate the impact that changes in government spending and taxation will have on economy. To do this they have a good idea of the value of the multiplier and an awareness of the possible side effects of policy measures. If governments underestimates the value of the multiplier , it may inject too much extra spending and thereby generate inflation and balance of payments problems. Fiscal policy instruments may also have undesirable effects. For example,a government may raise more tax in order to reduce aggregate demand. However , this may also have a disincentive effects and so reduce aggregate supply. This is true of progression taxation such as with income tax where rates increase as the level of earnings increases. Indirect taxes such as sales taxes and excise duties are regressive since they have to be paid at the same rate irrespective of income.

Some instruments of fiscal policy also suffers from significant time lags. Whilst changes in indirect taxes are relatively easy to effect, alterations in direct taxes and government spending take longer to implement and to work through the economy.

It can be difficult to raise taxation and lower government spending because of the political unpopularity of such measures and because of, in the case of government spending, the long term nature of some forms of government spending.For example, once a decision has been announced that the pay of government employees will be increased it would be difficult to reverse it and will commit the government to higher spending for some time.




                       Copyright Infringement is punishable by Law 

The Art of Delegation by Jolito Ortizo Padilla

Introducing our new Logo for the year 20013-2014

                             
Delegation is not an easy task.It involves behavioural as well as organizational and economic considerations,and it is subject to number of possible abuses. Effective delegation is a social skill. It requires a clear understanding of people- perception ,reliance on other people, confidence and trust and courage. It is important that the manager knows what to delegate , when and whom. Matters of policy and disciplinary power, for example, usually rest with the manager and cannot legitimately be delegated. Delegation is a matter of judgment and involves the question of discretion.

Delegation is also a matter of confidence and trust- both in subordinates and the manager's own performance and system of delegation. In allowing freedom of action to subordinates within agreed terms of reference and the limits of authority, managers must accept the accept that  subordinates may undertake delegated activities in a different manner from themselves. This is at the basis of the true nature of delegation. However , learning to put trust in other people is one of the most difficult aspects of successful delegation for many managers.

Delegation involves subordinates making decisions. For example , as Guirdham points out: "A strict separation of manager and subordinate roles sends the message to workers that they are only responsible for what they are specifically told to do. Managers who neglect to, or cannot delegate are failing to develop the human resources for which they have responsibility.

Mistakes will inevitably occur and the subordinate will need to be supported by the manager, and protected against unwarranted criticism. The acceptance of ultimate responsibility highlights the educational aspect of the manager's job. The manager should view mistakes as part of the subordinates training and learning experience, and an opportunity for further development. "Even if mistakes occur, good managers are judged as much by their ability to manage them as by their successes".

Notwithstanding any other consideration. the extent and nature of delegation will ultimately be affected by the nature of of individual characteristics. The ages, ability , training , attitude , motivation and character of the subordinates concerned will, in practice , be major determinants of delegation. An example,is where a strong and  forceful personality overcomes the lack of formal delegation. An example is where a strong and forceful personality overcomes the lack of formal delegation; or where an inadequate manager is supported by a more competent subordinate who effectively acts as the manager. Failure to delegate successfully to a more knowledgeable subordinate may mean that the subordinate emerges as an informal leader and this could have a possible adverse consequences,and for the organization. Another example, and potential difficulty, is when a manager is persuaded to delegate increased responsibility to persons in staff relationship who may have little authority in their own right but are anxious to enhance their power within the organization.

The concept of ultimate responsibility gives rise to the need for effective management control over the actions and decisions of subordinate staff. Whatever the extent of their delegated authority and responsibility, subordinates remain accountable to the manager who should , and hopefully would , wish to be kept informed of their actions and decisions.Subordinates must account to the manager for the discharge of the responsibility they have been given. The manager will therefore need to keep open the lines of delegation and to have an upward flow of communication. The manager will need to be kept informed of the relevance and quality of decisions made by subordinates. The concept of accountability is therefore an important principle of management. The manager remains accountable to a superior not just for the work carried out personally but also for the total operation of the department/ section.This is essential in order to maintain effective coordination and control , and to maintain the chain of command.

The manager must remain in control.The manager must be on the lookout for subordinates who are concerned with personal empire building than with meeting stated organizational objectives and prevent a strong personality exceeding the limits of formal delegation.We have said that delegation creates a special manager -subordinate relationship and this involves both the giving of trust and retention of control. Control is, therefore, an integral part of the system of delegation. However, control should not be so close as to inhibit the effective operation or benefits of delegation.

Copyright Infringement is punishable by Law...

Mobile Phone Manners by Jolito Ortizo Padilla

Since in parts of the developed world almost everyone has a mobile phone and copes with the ever increasing range of facilities and services with very little difficulty, I shall limit my remarks to suggesting ways in which we can all make the best use of mobile without inconveniencing others ( or indeed endangering life and limb!).

• Never use a mobile while driving a car-there is a considerable evidence that even with a hands-free system the distraction , both physical and mental , caused by operating the phone causes accidents.

•  Always switch your mobile off when in a cinema, theatre or social gathering.

•   Always switch your mobile off when in a hospital , surgery or in a plane.People do not seem to realize that the mobile interferes with essential equipment and electronic systems, and again there is increasing evidence that several plane crashes have been caused by interference to flight control systems.

• Consider those around you. As Jolito Ortizo Padilla of GA Consultancy commented,"At its most basic level, all rudeness is selfishness.With mobile phones this most commonly takes the form of thinking that you are moving around in an impenetrable bubble".

• If you must keep the mobile on in public place or on a bus or train, turn the ring tone down or preferably switch it to vibrate rather than ring.

• Similarly, don't text with your keypad tone set or loud, or pass time by going through your entire ring tone collections.

• Don't shout. Why is it that people seem to assume that their words are not being transmitted with the aid of microphone? And even at normal volume , be aware that people can overhear you. Use discretion when discussing personal or sensitive business facts or conversations on public transport or in a public place.Otherwise, at best you could appear very foolish and at worst you may be betraying secret company information.

• Don't pay too much attention to your mobile, especially on a date or in the company of others. Accepting calls or spending the entire time with your eyes fixed on your mobile as you read or send yet another text message is extremely rude.

• And finally, take care when using your mobile phone in the street to remember to look where you are going! And if you are using a hands-free system in the street be aware that passers-by when catching sight of you apparently talking to yourself may draw conclusions!

 

GDP and Happiness by Jolito Ortizo Padilla

Traditional economics states that the fundamental economic problem occurs because human wants are infinite but resources are only finite. Economic growth helps this problem because it allows more human wants to be satisfied. Economic growth leads to rising living standards and, by implication, greater happiness.

Economists have long recognized that the quantity of goods that consumers can buy is only one part of the measurement of the standard of living. Factors such as the social and cultural environment and political freedom contribute to the standard of living.However,there is an implicit assumption that GDP remains one of the most important components of economic welfare.

Economists using psychological surveys, though, presents a more complex picture. Using surveys from across the world (cross sectional surveys), they have found happiness and income are positively related at low levels of income but higher levels of income are not associated with increases in happiness. The idea that increases in GDP do not lead to increases in happiness is called Easterlin Paradox, after Richard Easterlin, an economist, who identified this problem in 1974 research paper.Using Southeast Asia survey data  suggests that life satisfaction in the Southeast Asia has actually declined since 2000 despite a more than 70 percent rise in GDP. All the survey evidence for the USA and Japan also concluded that there has been no increase in happiness in those countries over the last 12 years.

The conclusion from research is that an increase in consumption of material goods will improve well-being when basic needs are not being met, such as adequate food and shelter. But once these needs are being met, then increasing the quantity of goods consumed makes no difference to well-being. Having a new LCD television, or a new car doesn't increase your well-being in the long run.

There is a number of factors which have been identified which contribute to happiness from survey evidence.

• Relationships- Friends and family have a very important role to play in happiness. In 2010 research paper, the economist Nattavudh Powdthavee gave estimates of the monetary value of different types of relationships.Meeting friends and relatives just once or twice a month had a monetary value of $31000 per year per capita. This should be compared with average real annual household income per capita of $9800. Talking to neighbors most days was worth $40800. Being married was worth $68400. On the other hand , being divorced lead to a negative monetary value of $21600 per year. It is possible to dispute the exact size of the figures. However, the casual observer can see that individual placed a high value on relationships. Friendship are prized. Partners in marriage give up well paid jobs for the sake of their marriage. Most divorced people seek to remarry.The high point of consumerism in today's world , Christmas , is one where people give gifts to each other and spend time together as families. Being alone, cut off from friends, family and even casual day to day encounters, is associated with low esteem, depression and mental illness.

• Work- work provides income and satisfaction .However, research also shows that aspects of work depress happiness. Long commuting journeys, tight work deadlines, lack of control over how a job is done and housework have all shown up in surveys as being negative correlated to happiness and well being. Overall, the survey evidence suggests that workers in high income countries would be happier if they had lower incomes but more leisure time. As for unemployment, in the same survey was calculated to have a negative happiness value of $66400 per year.

• Health- Having good health has a very high monetary value in terms of happiness. The valuation put on excellent health is $303000 per year. Surveys suggest that health and happiness are correlated. Countries with above average incidence in high blood pressure are those with the lowest happiness scores. Good psychological health leads to happiness.Mental ill health has a large negative impacts on happiness. There is some evidence that mental health problems in rich countries have been increasing over time, possibly due to the increasing fragmentation of society and increased stress in the workplace.

Copyright Infringement is Punishable by Law

The Economics of Happiness - The first of the series by Jolito Ortizo Padilla

"Solidarity and Economics"- Bahrain's Road To Progress and Happiness

One branch of this new type of economics is called the Economics of Happiness or Happiness Economics.One of the most often quoted comments about economics is that it is a dismal science. This came from Thomas Carlyle writing in 1849; " Not a gay science ", I should say ,like some we have heard of, no a dreary, desolate and, indeed, quite abject and distressing one; what we might call, by way of eminence, the dismal science." Thomas Carlyle was a famous writer and social commentator of the time. He was contrasting some of the negative predictions of economics of his age with a "gay science" which at the time referred to "life enhancing knowledge".

Jeremy Bentham was a philosopher who put forward the theory of utilitarianism.This stated that human being should act in a way that would cause "the greatest happiness of the greatest number". This was a philosophy which should guide the individual : should I spend $500 on a holiday for myself or should I use it to pay for the tuition fees of my child at university? It was also a philosophy which could guide government policy: should the government increase taxes on high income on high income earners to pay extra spending on health care stay the same?

An assumption of utilitarianism is that happiness can be measured in the same way that the weight of a loaf of bread can be measured. If happiness cannot be measured, then individuals, governments and other decision makers cannot make the calculations necessary to ensure "the greatest happiness of the greatest number". The whole theory then becomes useless as a basis for decision making. Following Bentham's death,the consensus view in neo-classical economics came to be that happiness could not be measured. Economics could say nothing about the happiness or value that one individual puts on consuming a good or taking a job compared to another individual.

Another criticism of utilitarianism was that happiness is not the only the only goal in life. There are many other goals that human beings might have. They might prefer to be rich and famous rather than happy. Their goal might be to uphold the honor of the family. Status, power, possessions, control and sex are other possibilities.People's goal differ from culture to culture and it is is arguably too simplistic to reduce everything to happiness.

The economics of happiness refutes these problems and argues that happiness can indeed be measured and that happiness should be seen as the most important goal of individuals whatever their culture.

• Surveys can validly be used to ask people about the extent to which they are happy. With a survey large enough to be statistically valid , survey results produce reliable evidence about states of happiness and satisfaction. Such survey methods have been used in psychology for decades.They are backed up by neuroscience. During the 1990's,it was discovered that happiness was associated with measurable electrical activity in the brain. This could be picked up by MRI scans. So it is possible to tell physiologically whether or not someone is telling the truth when they say they are happy.
• Looking across cultures, philosophies and religions, and using evidence form sociological and psychological studies, it is clear that happiness is a goal of human beings. It is true that happiness might be given different names such as well-being, satisfaction, fulfilment or utility. But for the economics of happiness , these different names are all pointing to the same goal. Happiness can then be argued to be the same important goal. If asked,"why do I want to be wealthy or powerful?", most people would say "because it leads to happiness".Wealth, power or status are not ends in themselves. They are stepping stones to happiness.Think too of the reverse questions: "Is the goal of life to unhappy?" Or "Does it matter that people are unhappy?"Few people would argue that they wanted to be unhappy and that it didn't matter whether their relatives and friends and other people were happy or not.

                                             Copyright Infringement is punishable by Law