Introduction
According to Drejer (2002) core competencies are those that provide the firm with a competitive advantage when executed within the firm. A similar definition can be extended to define an individual’s competencies, which in this case would be those aspects or qualities of that makes him competent in what he does. In regard to Mack we look at those aspects which distinguish him from former managers at Morgan Stanley. These managers were unable to steer the company forward and put it at the same level or a better position with its competitors who had recorded tremendous growth from the time Mack had first left the company. In brief, we are looking at what he brought in the company that had previously missed, and what all over a sudden had spurred the company’s vigor and led it to profit making ones again.
Speed
The first of these competencies was speed. Before his return to Morgan Stanley companies would have their financing requests turned down or others never considered. This was especially so with those seeking private equity. This led the company to lose a lot of investment opportunities as well as a reasonable number of clients. The bureaucracy in the company also made it difficult to make speedy decisions which would have ensured sound investments (BloombergBusiness week).. However, when Mack took over he simplified the systems and made them more efficient such that investment decisions would be made in a speedy and timely manner. As Porter and Tanner (2004) point out speed is of essence in determining organizational power, they state that a company’s decision making process should be clear and speedy such that it allows the management to respond to changes as they come. This is essential in this competitive era, and every company should understand the importance of speedy decision making.
Identifying gaps
The other competency is identifying gaps and filling these with competent individuals. On assumption of duty Mack focused on sections of the company that were doing badly such as the bank’s division and asset management business where he replaced non performing individuals(BloombergBusiness week).. He also replaced rigid board members. Aquinas (2006) first identifies staffing as a key role of management, he proceeds to write that having a good organization structure is not enough to ensure success but this structure must be complemented with the right people to ensure success. This statement points out at this vital competency which Mack brought into Morgan Stanley Corporation.
Recognizing opportunity
The last of his key competency is the ability to recognize opportunity. The previous management had focused on operations in US and had shied off from risky investments such as private equity However, when Mack came in he changed the company’s investment policy and focused on risky but profitable investments which had started to generate returns within his first year of being at the helm of Morgan Stanley. Besides risky investment Mack sought to invest beyond US exploring opportunities in Asia and Europe (BloombergBusiness week). As Gitman and McDaniel write (2008) U.S. managers must develop a global vision if they are to recognize and react to international business opportunities as well as remain competitive at home. Mack brought this vital competency to Morgan Stanley and was largely seen as one of the crucial moves that the company had failed to make to turn around its dwindling fortunes.
Conclusion
In summary, for a business to remain competitive it has to have sound leaders at its helm. This was what was lacking at Morgan Stanley, Mack however came in and changed the company’s fortunes. This was largely because of his experience gained over time as well as his bold character. This case points to as the importance of having leaders with competencies which are commensurate with a business needs at any given time.
References
Aquinas, P. G. (2006). Principles of management. New Delhi: Anmol Publications PVT. LTD.
Drejer, A. (2002). Strategic management and core competencies: theory and application. Westport, Connecticut: Greenwood Publishing Group.
Gitman, L.J. & McDaniel, C. (2008). The future of Business: The essentials. New York: Cengage Learning.
Mack Attack: Buttressed by better earnings, a hungry Morgan Stanley is winning over critics.BloombergBusiness week, 2006. Web.
Porter, L.J. & Tanner, S.J. (2004). Assessing business excellence: a guide to business excellence and self-assessment. London: Butterworth-Heinemann.