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Contemporary Management Issues and Challenges
Abstract: contemporary management refers that which management tools are practiced by
today’s managers and business organizations. This is a top most aspect of management as well as
business organizations. Contemporary management practice starts from the ancient civilization.
Then it invents various aspects like administrative management, scientific management, modern
management and now every where practice contemporary management. There are some basic
issues of contemporary management like total quality management, e-commerce, human resources
management, project management and globalization. Besides those issues in recent some more
issues are upcoming in contemporary management. Management in the changing society has
become important to all because of its universal application, and therefore, contemporary issues
on management provide basics on the effectiveness of work-life of individuals and groups who
work at different situations in competitive world environment.
Management expert has developed various philosophy and theories for the development of
management in human civilization. They provided a proper direction through application of
various model in order to achieve organizational objectives. Contemporary management is the set
of theories that are developed at present and properly applied in order to achieve organizational
goals. Management system, philosophy, and theories have been changing by the course of time. All
the present philosophy and model are not applicable properly in the field of management in all
organization equally.This is the new issue of the "MANAGEMENT". Its primary goal is to present
current research in the field of management both to domestic and foreign public. Th epaper deals
with issues facing the large and small companies. It deals with pressing problems, not only of
general nature, but especially with those occurring in the countries in transition also. In fact, it
aims to cover functional issues, specific topics and general aspects of management related to all
kinds of organizations – manufacturing and service companies, profit-making firms and non-profit
organizations, private and public, as well as large and small enterprises. We want to analyze and
present the broad management problems in contemporary setting from the view piont of top
management.

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1.0 INTRODUCTION
We are 4th
year 8th
semester students. After a few days we will go for job market and compete with
other students. As a result we may fall behind due lack of available knowledge at today
management issues. So it is a great opportunity to prepare a term paper on “Contemporary
Management Issues and Challenges”. We will discuss on this paper about some main and basic
management issues and challenges that today’s manger faces. We also discuss about the evolution
of today’s management.
1.2. OBJECTIVE OF THIS STUDY
This report has prepared aimed some important objectives. The objectives of this report are as
follows.
• To know about the essentiality of management in a business organizations.
• To find out the elements of contemporary management issues.
• To know that how a issues become management as well as modern life issues.
• To identify some issues and challenges faced in today’s engineering management fields.
• To analyze and present broad management problems in contemporary setting from the view
piont of top management.
• To compare the impacts of Industrial Revolution with the “Information Revolution”.
• To cover functional issues, specific topics and general aspects of management
related to all kinds of organizations.
1.2 SOURCES AND INFORMATION:
The subject of this term paper is basically based on secondary sources. So we go for internet and
some books and articles and magazines of business aspects. We also got help from our respective
teachers. We collect various information from daily newspapers.

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2.0 CONTEMPORARY MANAGEMENT
Significant and rapid changes are continuously occurring in the international business
environment. In a field where change is the only thing that is constant, business operators are very
much into the adaptation of management models and approaches that are different from
conventional and obsolete practices. Certain affective factors such as increasing global competition
and rapid technological developments urged most corporations to become more inclined with
global operations and diverse cultures. In addition, the rapid technological developments occurring
worldwide as well as the introduction boundary-crossing innovations resulted to fast and quality
production, thereby amplifying the level of competition in the global setting. Companies which
attempts to enter foreign market are being challenged by various factors and this include cultural
differences and these companies are commonly known as trans-national or transnational
corporations.
It can be said that because of the emergence of globalisation, the transnational companies
nowadays are considered as those corporations which implement different strategies to stay in the
competition. According to Doole and Lowe (2006), the most transnational corporations are
considered to be businesses which are aggressively building their global market and strategies
around these characteristics and features: increased market access because of the opening up of
markets in China, Central and Eastern Europe; increased market opportunities because of the
deregulation of many markets, such as the financial market and privatisation of state-owed utilities;
greater uniformity of industry standards, encouraged, for example, by the European Union;
sourcing of products and components initially, but more recently services, too, from a wider range
of countries, particularly those emerging markets with a high ratio of skills to cost; more globally
standardised products and services, particularly in areas of new technology, but increasingly in
more culturally sensitive product areas, such as food; common technology used in many more
markets, particularly in areas of information technology, when there is a high cost of research and
development that must be recovered through sales in many countries; similar customer
requirements leading to transnational customer segments, resulting from increased communication
and travel; competition from the same organisations in each major market and thus
interdependence of markets; global organisation strategies that increasingly treat the world as one
market, among several other themes.
It can be said that transnational organizations are more exposed in various issues which should be
given enough attention. It can be said that the emergence of various transnational corporations
have also post challenges on managers or management of various countries. In this regard, the
main goal of this paper is to provide an analysis of the issues facing managers in Hong Kong. In
this paper, the issue that will be given emphasis is with regards to diversity issues.
2.1 Contingency Theory
According to Fred Luthans: ‘’Contingency theory is a viewpoint that argues that appropriate
managerial action depends on the particular parameter of the situation. Hence, rather than seeking
universal principles that apply to every situation, contingency theory aatempts to identify
contingency principles that prescribe actions to take depending on the characteristics of the
situation.’’

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Basically, contingency theory asserts that when managers make a decision, they must take into
account all aspects of the current situation and act on those aspects that are keys to the situation at
hand. Basically, it’s the approach that “it depends.” For example, the continuing effort to identify
the best leadership or management style might now conclude that the best style depends on the
situation. If one is leading troops in the Persian Gulf, an autocratic style is probably best (of
course, many might argue here, too). If one is leading a hospital or university, a more participative
and facilitative leadership style is probably the best.
2.2 Systems Theory
System is a set of things interconnected so as to form a complex unity, a whole, composed of parts,
in orderly arrangement according to some scheme or plan.
Systems theory has had a significant effect on management science and understanding
organizations. First, let’s look at “what is a system?” A system is a collection of part unified to
accomplish an overall goal. If one part of the system is removed, the nature of the system is
changed as well.
For example, a pile of sand is not a system. If one removes a sand particle, you’ve still got a pile of
sand. However, a functioning car is a system. Remove the carburetor and you’ve no longer got a
working car. A system can be looked at as having inputs, processes, outputs and outcomes.
Systems share feedback among each of these four aspects of the systems.
3.0 DIVERSITY ISSUE
In working in the global environment, it is said that transnational managers are encountering some
problems and issues, and one of these is the problems of diversity. The diversities among different
countries are likely to develop practices which are different from other nations. In reality, the
management practices are subject to distinctive sets of national rules as well as sensitive analysis
of labour unions whose strength and thoughts towards management differ.
Study of transnational manager’s strategies to manage their diverse human resources has been
discussed by various scholars. Here, one of the main concerns was how the different subsidiary
companies in Hong Kong adapted to their host country’s culture, norms, and ideas, while at the
same time upholding their parent company’s ideals and goals. This is a different way in looking at
the subsidiaries, as the parent companies were not asked to participate in the questioning. The
findings concluded that the subsidiary turn on the host country for their HR needs while the host
country becomes dependent on the subsidiary for providing some of their needs to them (e.g., jobs,
money, resources, etc.), however when the subsidiary company the parent company has a larger
ownership stake placed on the subsidiary, the parent company begins to practice global HR due to
fear of the host institution’s taking over. It was also found out that the managers of multi-national
companies (TRANSNATIONAL CORPORATIONS) impose global HR strategies for their
subsidiaries and that these subsidiaries' dependence on the TRANSNATIONAL
CORPORATIONS is based on how the international human resource strategy is imposed upon the
subsidiary company. Also, the host countries' influence on the subsidiary company and the policies
concerning the international human resource is based on the intensity of the parent-companies'
influence on the subsidiary companies.

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Diversity in the workplace and the management has long been an issue debated among work
organizations. In the some nations, for instance in Hong Kong, race has been an intense
determinant of individual political rights, positions or locations in the labour market, individual
access to medical care and even an individual sense of identity. Most importantly, race is one of
the major bases of domination in its society and a major means through which the division of
labour occurs in organisations. Gender is also a basis for stratification in organizations and work.
Managing a workforce for global operations is not only comprised of a few employees but a large
group of managers, executives, specialist and professionals, making it a challenging task.
Nonetheless, through gradual yet progressive transformation, the international management of the
employees can bring about important organizational developments.
Culturally diverse organisation occurs when an industry like most of the industries in Hong Kong
opted to operate in a foreign market. Diversity has been characterised roughly as groups of two or
more persons, which characteristically have demographic dissimilarities including differences in
norms, beliefs and cultures. Here, the people who are working came from different ethnic
backgrounds that possess different attitudes, values, and norms. Different employee issues and
conflicts are more largely to appear in a culturally diverse organisation, this companies like
automobile companies that operates in Hong Kong could not resist having different employees,
which came from different countries provided with different cultures and personality. Managing
people in a culturally diverse organisation is a very difficult responsibility for managers to be able
to achieve the mission of an organisation, which is to provide products and services in other
nations.
One of the potential soft human issues that might be encountered is in terms of cultural diversity
and differences among employees and staff who will be involved in the operations of transnational
corporations. Diversity and differences may lead to internal conflict if the managers would not give
consideration to this factor. For managers leading or working in diverse staff, the level of
flexibility, communication capabilities and hands-on management needed often goes above and
beyond what they are accustomed to. Regardless of where they are located, managers may find
themselves challenge to motivate struggling employees. Managing culturally diverse employees
also result in another internal soft human issue which is in terms of having poor communications.
The managers may experience most uncomfortable moments when the management have to deal
with diversity among people. Because of these differences, the managers might face
disagreements, arguments, and even open conflict due to poor communication. To add with
discomfort faced by the managers, the management frequently finds themselves torn by two
opposing desires and beliefs. The managers is further bothered and disturbed by the fact that with
diversity of the employees which results in poor communication, strong feelings are frequently
experienced, the existence of objective ideas, threatened egos and personal relationships are placed
in jeopardy. Because the presence of poor communication due to differences the managers job
become more complicated. It is of utmost importance that the managers should understand these
issues fully and learn to handle them effectively.
Aside from differences, poor communication may also occur because the employees or other
individuals within the organisation do not show willingness to accept and comprehend what the

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managers is uttering. Accordingly, all communication is a consensual activity. No one can be
forced to listen, communicate, or absorb information as it was intended. Every individual is in total
control of his or her own willingness to listen. Hence, the managers must have the ability to make
communication interesting yet effective in preventing further conflicts while doing the
responsibilities in the global workplace. Studies on organizational communication have always
been used by large companies so as to ensure good working relationships among employees as
well as to evaluate the relationship among members and staff of big corporations. Dowling and
Schuler (1990) further elaborated that the idea of global community in a model that suggests
intercultural and international communication and ethical problems to best address the immediate
need is of much importance to truly build a global community.
Inescapable as it may seem, workplace dilemmas which is brought by cultural differences are
unavoidable and should be expected at transnational corporations or in business firms owned or
controlled by individuals from a different cultural orientation especially when they employ the
local citizens in the global workplace. Dealing properly with situations such as instances of
principled power struggle between supervisors and subordinates from different cultural
orientations, will be of much help in running a business firm properly and successfully. Managing
effectively these contemporary issues and conflicts and working out a good relationship by
compromising for the good of all will help the managers to ensure smooth working relationships
among the employees, staff, supervisors and subordinates.
It is important that the managers should have knowledge in different types of communication in
order to determine which of these forms will be useful in assuring that poor communication will
not become a hindrance to successful task management. The types of communication may be
formal or informal, upward, downward, and horizontal communication. Formal communication is
the official communication that passes through the structured organisation. For example, in this
case wherein, the managers will lead other employees or the task to be done, he or she may use the
formal type of communication to control the situation while informal is the kind that is a type of
communication which includes reports, rumours and statement in which the truth may not be
verified by the managers. Upward communication is a type of communication in which the flow of
the conversation only travels from the manager to a manager. The downward type of
communication is a type in which the flow of the conversation travels from the manager to lower
levels within the team, while the horizontal is a kind of communication in which the information
flow laterally within the team.
4.0 EVALUATION
Different employee issues and conflicts are more largely to appear in a culturally diverse
organisation, this companies that operates in an international arena may possibly not defy having
various staffs that came from different nationalities given with different personalities, behaviours
and cultures. In any business enterprise, employees are considered as the most vital assets. In order
for these companies maximise their assets, managers of Hong Kong should have the ability to
effectively manipulate employees’ working condition by efficiently managing their diverse
personalities. Herein, the employees must be allowed to be involved in the decision making
process to further enhance the organisational structure. Moreover, the structure of tasks among the
employees strengthens the organisational performance. As problems of regional and cultural
diversity politically led administrative issues impede the functioning of the organisation, it is very

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essential to understand the employees. The enhancement, building, enthusiasm, motivation and
development of the employees of any organisation depend largely on the leadership, mandate and
vision of the organisation.
In order to solve the issues and make this issues an opportunity to enhance their managerial
abilities, the managers of Hong Kong must be able to employ the general HRM practices of the
transnational organisation that he or she is working at. In this manner, the managers must give
emphasis to the differences of their employees so as to have a harmonious human resource
relationship. There are also times in which the company must be able to reach the globalisation
phases that the management of the transnational corporations, attempts to thoroughly globalise its
human resource management. Analysis shows that cultural diversity post a major issues not only
in the managers of the transnational organisation but also to other managers in Hong Kong. The
challenges post by this transnational organization among managers in Hong Kong can also be
considered as a threat for having an effective management approach that adheres to the different
needs of the employees and by enabling the company to have a more productive employees in spite
of the cross cultural issues provided with transnational organizations.
5.0 CONTEMPORARY ISSUES
5.1. QUALITY MANAGEMENT
One of the prime issues of today contemporary management is the quality management. Quality
management provides the principles and the methodological frame for operations, and coordinates
activities to manage and control an organization with regard to quality. Quality assurance and quality
controls are the parts of any successful quality management system. Quality assurance focuses on
providing confidence that quality requirements will be fulfilled and includes all the planned and
systematic activities implemented in a quality system so that quality requirements for a product or service
will be fulfilled. Quality control is associated with those components used to ensure that the quality
requirements are fulfilled and includes all the operational techniques and activities used to fulfill quality
requirements. This chapter concerns quality management associated with quality control and quality
assurance and the formal accreditation of the laboratory activities, especially from the point of view of
meteorological observations of weather and atmospheric variables.
Total Quality can be managed through ensuring-
ͽ Meeting customers’ requirements,
ͽ Commitment by senior management and all employees,
ͽ Continuous improvement,
ͽ Planning quality into products and processes,
ͽ Teams,
ͽ Employee involvement and empowerment,
ͽ Recognition,
ͽ Benchmarking,
ͽ Certification (ISO),
ͽ Six sigma.
5.2. CUSTOMER STRATEGY

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Customer focus is the commitment to putting customers first and ability to deliver a consistently high
quality service. Most companies have a product strategy and a marketing strategy. Customer-centric
organizations also have a customer strategy. Put simply, a customer strategy is a proactive plan for how
we want to acquire, retain, and grow our customers! Too many organizations leave it to chance when it
comes to retention and growth of customers, focusing most of their resources on customer acquisition.
Why would we want to leave the management of our most valuable asset, our customers, to chance?
In order to align our customer experience with our customer strategy, we need to consider how we have
created that strategy. A strong customer strategy is built around the interactions we have with our
customers, and we are able to maximize the value of every customer touch. In other words, we make
each impression with the customer count. Customer service and support may have several opportunities
to make customer impressions, and it is often where the rubber meets the road. How do we handle our
customers when there is a problem or a question? The goal of all these interactions is to increase
customer retention and loyalty, which ultimately leads to repeat business and referrals. Done right, a
customer strategy will also build customer trust, strengthen the relationship, and add value to both the
customer and the company.
Customer-focused strategy is a planned approach to how we handle our customers at every touch point. It
is more than just giving great customer service. It is more than marketing with certain customer
buzzwords. It is more than a great customer experience. It requires a strategic plan to be put in place to
address all of those areas, plus the metrics to ensure the success of the strategy.
Great Examples
Glenn also asked for examples of companies who do this well. There are a few competitions out there for
this type of award; a great one is coming up from the team at Peppers and Rogers Group and Gartner.
Called the Gartner and 1to1 Customer Excellence Awards, it will be showcasing those companies that
“get” customer strategy – and how to execute it. (By the way, the contest is open until May 23, so if you
are reading this and want to submit your company, you can go here and enter.)
5.3. INFORMATION TECHNOLOGY
Technology plays a key role in today's business environment. Many companies greatly rely on computers
and software to provide accurate information to effectively manage their business. It is becoming
increasingly necessary for all businesses to incorporate information technology solutions to operate
successfully. One way that many corporations have adopted information technology on a large scale is by
installing Enterprise Resource Planning (ERP) systems to accomplish their business transaction and data
processing needs. The company named SAP Aktiengesellschaft (commonly known as SAP AG in the
business press) is currently the world market and technology leader in providing ERP systems. As such,
this paper primarily discusses information technology implications based on the SAP system.
5.3.1. ERP systems:
Enterprise Resource Planning (ERP) systems are software packages that use relational database
technology to integrate various units of an organization's information system. ERP systems provide
several separate, but integrated modules, which can be installed as a package for any organization
(Scapens and Jazayeri 1998). Many large corporations use several different and separate information
systems, often because they have merged with and/or acquired other companies with varied systems. An
ERP system integrates these separate information systems and results in improved data reliability and
processing efficiency. ERP systems quickly became popular with large corporations that needed a

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seamless integration of their business, but are now frequently used by small to mid-sized companies. The
excellent ability of ERP systems to simplify business transaction processing, eliminate work that adds
little or no value, and simultaneously improve customer service are the main reasons for the outstanding
success and popularity of these systems.
5.3.2. E-Business:
In today’s business climate, e-Business can have an impact on every facet of the organization,
including processes, applications, staffing, infrastructure, relationships, sales, and sales channels.
Not only is e- Business transforming companies and industries, it’s doing so at an accelerating rate.
Business cycles that use to be measured in years are now measured in days.
Competition in the future, even today in certain industries, will not be company against company
but supply chain against supply chain. Companies will be only as strong as the weakest link in
their supply chain. The winners will be companies that can build up, or tear down, electronic B2B
relationships rapidly and seamlessly. As part of this transformation, enterprise borders are starting
to disappear. e-Business is all about providing open access to infrastructure services, data, and
applications. Partners, suppliers, customers and, in some cases, even your competition (or co-
operation) will be able to peer 3into your corporate nervous system.
Hopefully, all of this will be for the better. But, if not handled correctly, sometimes it may be for
the worse. Customer expectations are rising mercilessly in terms of the speed and reliability they
expect from your e-Business applications. Studies show that Web customers will wait only eight
seconds for a page view, even if they are on a slow connection that you have no control over.
5.4. PROJECT MANAGEMENT:
Project management involves coordinating various aspects of a project in order to bring forth a positive
result. This coordination can include elements such as personnel, materials, procedures and facilities.
Over the past five to ten years, there have been increasing challenges faced by Project Managers. Within
the last decade, the Inventory of Major Alberta Projects lists a total of $128 billion in projects recently
completed. With multi-million dollar projects being approved by the Alberta Energy and Utilities Board
on a regular basis, many based on oil and gas exploration and refinery, the challenges facing today’s
Project Managers are bound to be formidable. Some of the aspects of project management that are
particularly challenging are quality, cost and schedule. There are various other mitigating factors as well;
influences that Project Managers do not have control over. Sometimes these external factors can have as
much impact on project management as the factors that Project Managers can control.
The first aspect of project management that can be problematic is the area of quality. From the point of
view of the owners of a project, quality can be a challenge. The owner representatives (sometimes also
referred to as the client, if construction is being managed by a third party) tend to spend the bulk of their
time on stewarding to the managers. This means that the representatives may not be focusing on quality
nearly as much as they should be. In reviewing the Lessons Learned following a major project in
Northern Alberta, it was noted that quality assurance and quality control should be managed by the parent
company, not by a contractor or other third party. It was also determined that the parent company should
review and approve job specific construction contractor quality plans prior to the work being started.
Another key lesson that was learned is that lump sum work (which can be a significant portion of overall
project spending) should be held to a higher standard of quality control than reimbursable work.
This standard should be communicated throughout the bidding process and in the Contract Terms.
Sometimes during the latter stages of project engineering, the contractor can be eager to start

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construction. It has been recommended that contractors be reigned in until engineering is truly complete
prior to starting construction, in order to minimize re-work and other such issues. Also, once construction
has started, contractors need to be reminded that any field engineers that they use must liaise with the
project engineers prior to any engineering changes being made. This creates consistency between what
was planned and what actually takes place in the field.
5.5. GLOBALIZATION:
Globalization is much more than an economic phenomenon. The technological and political changes that
drive the process of economic globalization have massive noneconomic consequences. In the words of
Anthony Giddens , a leading sociologist: “I would have no hesitation in saying that globalization, as
we are experiencing it, is in many respects not only new, but also revolutionary Globalization is
political, technological and cultural, as well as economic.”
The noneconomic aspects are at least as important in shaping the international debate as are the economic
aspects. Many of those who object to globalization resent the political and military dominance of the
United States, and they resent also the influence of foreign (predominantly American) culture, as they see
it at the expense of national and local cultures.
6.0 FUNCTIONAL ISSUES:
Functional issues refer to the pressing problems of the four fundamental management
functions:
 Identification of goals, choice of strategy, forecasting, elaboration of
plans and budgets and decision making;
 Design and selection of organizational structure, design of internal
relations system, as well as design of management system;
 Organizational behaviour, motivation, leadership, communication,
groups and relations within the groups, interpersonal relations and
conflicts;
 Control methods, control areas, information systems in controlling.
Specific topics will be related to the current problems in specific management areas and the
production activities, such as:
 Finance, operations, marketing, sales, supplies, logistics, research and
development, accounting, audit, human resources, costs, etc.;
 Industry, trade, hotel industry, banks, non-economic and public enterprises,
branches, associations, cities, regions, etc.
Some general management problems will be also included in the Journal. These problems
deal with the subject, goals and methods of the management science, theory of management,
as well as with the ethics and social responsibility of management as a profession, etc.
Special attention will be paid to the problems of strategic management which represents a
synthesis of functional and other specific management fields.
6.1 Criticism of modern managemtn theory:
The modern management theory is developed in recent time. So various new elements
influence the new modern mangement theory. There is no lacking of theis theory for why we
can reject the theory. The Criticism of modern managemtn theory are discussed below:

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1. Incomplete doctrine: the modern management theory is often called an incomplete
doctrine. More emphasize is given on decision making in this approach. For this it is called
incomplete doctrine.
2. Operation cost: it is to be deemed that operating the organizational activity based on
the modern management theory is very costly. As a result the small or medium size
organizations are unwilling to apply this model.
3. Quick change: the management functions are changing very quickly systematically.
So many organizations are unwilling to apply this theory in order to achieve long-term
organizational objectives. Because the application of management function is changing
rapidly.
4. Lack of specialist: modern management theories are changing rapidly. There is a
lack of person who can cope with the change and apply the modern management theories.
So the application of model of modern management is hampered due to lack of specialist.
5. Failure to sketch of proper diagram: diagram is used to operate the management
function. As modern management theories are changing rapidly so it is difficult to sketch
proper diagram and to implement the management function.
7.0. CONCLUSION
Working in a transnational organization which inhibits culturally diverse condition is challenging
especially for the managers in Hong Kong, but managing a culturally diverse people in the global
environment presents even greater management challenges. However, this challenges post also
rewards for the mangers and helps them in opening their minds and sharing their experiences. The
managers of Hong Kong are being challenges to consider two aspects of management. The first is
working with staffs that are culturally different and giving a efficient service to a culturally diverse
community. These aspects must be given enough focus by initiating an effective and suitable
management approaches. In this regard it is recommended that the global managers in Hong Kong
of transnational corporations should be able to develop a successful organisational culture and a
stable organisation by means of effective management of the people. In addition, communication is
a very important factor to use in order to have a harmonious and smooth relationship between the
management team and the employees in the international level.
In addition, the management should try to integrate its own management system with the
management system of the host countries, in which transnational corporations are operating. The
main goal of this integration is to let the employees within the international operation feel that their
culture, values and traditions are not being discriminated by the management.
It is also important to note that global work place needs human resource management that have the
ability to employ the principles and concepts of emotional intelligence and give emphasis to the
importance of self-awareness in dealing with diverse people, winning their trust and to ensure that
the people’s values and the organisations objective will intersect to a common goal and that is to
incorporate good employment relationship.
All in all it is very crucial that global managers in Hong Kong should make a way in adjusting their
management styles and approaches to adhere with the differences and similarities of the
employees, specifically those in the global environment so managers may catalyst the motivation
among diverse individual.

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