Week 2: Aviation
A credit-based economy is defined as an economy where individuals and organizations engage in contractual agreements whereby the borrower receives something of value and agrees to repay the lender at a later date taking into account interest. Primarily, the contractual agreement enables borrowers to acquire something of value that they can effectively utilize to run their organizational operations thus achieving the desired goals of production. A manager of fixed based operations (FBO) can use diverse methods to improve the cash position of the organization. First, the manager needs to accelerate the cash inflows. Cash inflows often represent the movement of money into the organization. Accelerating cash inflows will significantly improve the organization’s cash flow and enable the organization to pay its bills and other obligations such employee salaries (“Steps to Take to Improve Cash Flow Management,” 2018). Second, the manager needs to delay the flow of money out (cash outflow) of the organization. This requires the manager to focus more on the conversion of the sale of the organization’s products and services into cash available for cash outflows. Increasing the sales conversion period enables the organization to accrue the benefits or value of cash inflows such as faster spending rate. Also, the manager needs to minimize various expenses such as operational costs of the organization.
In recent years, unnecessary employee turnover has cost aviation organizations needless expenses. Turnover has a direct impact on organizational costs, performance, and productivity (Loquercio, 2006). As such, retention of the experienced and competent employees has become one of the strategic focus within most aviation organizations. As a manager of an FBO, to enable the retention of competent employees, I would advocate for better and improved salaries. I would also create a healthy and friendly working environment favourable for employees, encourage effective interpersonal relationship to boost collaborative performance and the quality of output, as well as assure competent employees of job security. Moreover, I would engage competent employees in the proper and effective orientation program. Through the program, I would inform them about the terms of employment, health and safety regulations, employee development opportunities, as well as organizational rules and policies. Employee turnover is also influenced by behavioral and attitudinal factors. As the manager, I would advocate for employees’ job satisfaction and offer extrinsic rewards.
Concerning decentralization of decision-making practice within the organization, as the manager of my FBO, I would feel relieved from a decision-making perspective. I would advocate for the integration of the practice in the organization for various reasons. First, with decentralization of the decision-making process, I would be in a better position to advocate for more employee participation in the process with the aim of generating more information and evaluating alternatives useful in the better decision-making. The decentralization of decision-making also allows a reduction of conflicts or blame in the case of failure or error. Second, adoption of the practice in an organization positively influences the environmental dynamism (Nooraie, 2014). As such, as the manager of my FBO, I will involve and encourag employee participation in more challenging responsibilities with an eye on achieving the organization’s desired goals. Also, the practice influences the quality of the output process. As the manager, I will advocate for the employees’ adherence or compliance with existing ethical standards as well as engage in the effective and independent decision-making process in the case of critical situations that need prompt attention.
Loquercio, D. (2006). Turnover and retention. People in aid. Retrieved from https://www.chsalliance.org/files/files/Resources/Articles-and-Research/turnover-and-retention.pdf
Nooraie, M. (2014). The Roles of Decentralization of the Decision-Making Process between Contextual Factors and Decision Process Output. International Review of Management and Business Research, 3(1), 333-347. Retrieved from https://pdfs.semanticscholar.org/e28e/ae3d11621fe23196ddcc716e79dbcdee3399.pdf
Steps to Take to Improve Cash Flow Management. (2018). Retrieved from https://www.bizfilings.com/toolkit/research-topics/finance/managing-cash-flow/steps-to-take-to-improve-cash-flow-management