Thursday, December 12, 2019
Economic and Financial Crisis
Question: Construct a plan for a "change" within your Organization (or Organization of your choice). As leaders we are constantly solving problems, so use this opportunity to describe the need for change, provide background/historical information as needed, barriers or resistance to the change, benefits, recommendations, and the process/strategy you will follow to implement the changes. Answer: Slide 2: The economic and financial crisis originated in the world where the percentage of rich and wealthy people is more. This is termed as a financial meltdown or a credit crunch. In these conditions the investment capital is very hard to obtain for every sector, it may be health, infrastructure or in core banking. This crisis happens by the free market capitalism itself. Slide 3: The market regulation cannot be done in a free market. Free market causes chaos in the regulation of the investment and expenditure. The balance in a capitalistic market is on the profit not on the social issues. The debts when accumulates in the market causes a huge gap between the real economic value and the virtual wealth that circulates in the market. This phantom wealth is unreal, imaginary, and the most dangerous things are many huge and influencing financial institutions and banks are connected to this. Entire economies, lives of millions are entangled with this system. Slide 4: Risks take in a free market more often returns losses if not given time. This type of market creates a system like a global casino system, where the free market causes the economy to rest on virtual wealth. The financial system becomes detached from the real economy. According to Indian economist C.T. Kurien, the free market finance can be divided into metaphorical definition of Planet Finance and Planet Earth. Slide 6: The problem in an institution, is lack of organizational structure that can regulate the business model of the in an economic cycle. The banking sector under the government control are normally more regulated than the private banks, the shortcoming of private banks thus can be easily hid from the public eye, where as the public banks have to adhere to the rules of the government which makes them answerable to the public. Slide 7: The characteristic of leadership is a prime factor when it comes to handling of the banking institutions with efficiency so that the focus changes from the hard risks such as Capital, Leverage, and Liquidity. Risk management is one of the integral parts of business management. A leader has the responsibility for making an informed and transparent approach to tackle risk management. Slide 8: The central component is to assume a socially responsible model of business where the risks taken are controlled and strategic. Slide 9: Changing work culture or inherent basis of thinking in an organization is one of the most difficult leadership challenges. An established organization is run with a mutually reinforcing system. Moreover, it resists any change, since change causes a de-establishment of central structure. Slide 11: An established organization is run with a mutually reinforcing system. Moreover, it resists any change, since change causes a de-establishment of central structure. Slide 12: Any change in the system like knowledge management, new processes may appear to make a change in the system but in course of time the interlocking elements that work mutually in an establishment, these elements takes over and the change is again drawn into the existing organizational work culture. Slide 13: Changing the culture of the organization needs to change the structure of the organization in a large-scale undertaking at first the mindset have to be changed. The goals and immediate terms of the establishment have to be changed gradually so that the people working in the organization have ample amount of time to get used to the change.