There are many resemblances between politics and management. One of them is that they both share the development of Policies. Where should your company differ from a political institution in order to be successful?

A policy is like a map that serves to guide an organization into a certain direction. A governmental policy serves in the same way to guide citizens. The resemblance between government and management is even more striking for larger corporations with the practice of corporate governance;

Corporate governance is the set of processes, customs, policies, laws and institutions affecting the way a corporation is directed, administered or controlled. Corporate governance also includes the relationships among the many players involved (the stakeholders) and the goals for which the corporation is governed. The principal players are the shareholders, management and the board of directors. Other stakeholders include employees, suppliers, customers, banks and other lenders, regulators, the environment and the community at large. (www.wikipedia.org)

This means that politics and business converge with the size of a corporation and with the increasing number of stakeholders - especially the environment and the community.

...An important part of corporate governance deals with accountability, fiduciary duty and mechanisms of auditing and control. In this sense, corporate governance players should comply with codes to the overall good of all constituents.

<p>And with this increase in size the "codes" (policies) increase as well. Both politics and organization deal with credibility. Politicians are facing a hard time to remain credible because of the enormous number of issues they are dealing with and which they need to respond to with a coherent line of policy. The more they deviate from this line the less credible they appear to be.

Larger organization can narrow their focus which will make it easier to pursue a consistent policy. The difference between government (and governmental organizations) and market organizations is that the former lacks a strategy.

In line with this reasoning, and observing real politics, a company that lacks a strategy will have a hard time implementing a policy. Or put differently; make sure that you elaborate a sound strategy if you do not want (internal) political debates leading you nowhere.

© 2006 Hans Bool

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