MAS holdings: An overview
MAS Holdings is a large apparel manufacturer in Sri Lanka, whose partners are also some other well-known fashion brands in the world including Victoria Secret, Gap, Inc., Nike etc., as introduced by Watson and Story (2006). Its “About us” website also states that MAS is now a giant in South Asian in undergarment and sportswear manufacturing industry with more than USD 700 million of revenue every year. The company’s history was described thoroughly by Watson and Story (2006), from which a number of reasons for its success could be figured out. However, the factors standing out from those reasons were from its management activities. This assignment is going to analyse the above aspects with the MAS case study by Watson and Story (2006).
The first thing to be discussed is how the MAS’s manager helped it flourish. In this case, the roles of a manager in the general context of business should be considered. According to Mintzberg (1973) in Boddy (2008), there are 10 roles for a manager to play in total. Those roles are divided into 3 main categories: informational roles, interpersonal roles and decisional roles then described by Mintzberg (1973) in Boddy (2008). Informational roles are required from managers for the information inside and outside of the organisation to be received and transferred. This includes monitor (finding and acquiring information), disseminator (passing the information acquired) and spokesperson (passing the information to out of the company). Interpersonal roles are required from managers to build and maintain relationships between people in the company and also with people outside, which comprise of figurehead (representing the organisation in formal events), leader (making people do their jobs and help them to improve) and liaison (networking between the business and its stakeholders). Decisional roles are required for managers to make right decisions for the firm including entrepreneur (creating new things, making significant changes, catching opportunities and indicating development routes), disturbance handler (solving accidental problems or changes), resource allocator (distributing the resources of the organisation to the right sector with the right amount and in the right time) and negotiator (convincing the stakeholders). Mintzberg (1973) suggested in Boddy (2008) that every manager plays all of these roles, however the priority of each role may vary depending on his/her position.
In the case study of MAS by Watson and Story (2006), there were a variety of evidences supporting the application of the above roles. Firstly, the informational roles could be proved by the way the production line was supervised: “The supervisors walk through each cluster of machines, making notes. They sync their Palm Pilots to the central database to post their line’s current efficiency and productivity numbers on the electronic boards overhead.” (Watson and Story (2006), page 5), which showed the monitor and disseminator roles. With this method, the production management of MAS became very professional that enabled itself and its partner to continuously track the production progress and make changes when necessary to increase efficiency or to meet the new demand, while creating a good image for MAS as a reliable manufacturer. On the other hand, the interpersonal roles were proved mainly by leadership. In this aspect, the MAS’s managers, especially the Amaleans who chose follow an ethical business concept, attempted to motivate the employees by a very high-quality working environment and by the provision of life supports, training, education, as well as promotion prospects, which helped some exemplary persons like TNS Kumari to noticeably change their poor lives. As a result, this again created another good image for MAS, this time as a business “doing the right thing” (not the “sweatshops” bias in apparel industry at that time), attracted more local talent who tend to seek opportunities overseas and maintain strong relationships between the company and employees, which were important for further development. Last but not least, the decisional roles were proved mainly by entrepreneurship. The entrepreneurship of MAS’s managers is illustrated through the fact that the Amaleans started their own business, created new units (two IT branches, an own brand Amante in 2007 as introduced in Amante page on MAS Website) looked for and caught opportunities (creating joint ventures with several famous fashion brands then learn from them the modern technology and business practice) and decided the paths of development (concentrating on lingerie manufacturing, reaching high technology by partnership with Speedo). These were some of the major decisions that boost MAS’s growth from a USD 6 million annual revenue firm in 1990 to an over USD 570 million annual revenue one in 2005, according to Exhibit 2, page 18 in Watson and Story (2006).
The second topic of this assignment is the management approach. As Worthington and Britton (2009) said, in the general business context, there are 3 main approaches: classical approach, human relations approach and systems approach. According to Worthington and Britton (2009), the classical approach is based on scientific management and bureaucracy, which were studied by Taylor (1856-1915) and Weber (1864-1920) respectively. The former means increasing productivity by the “one best way” to do the job and by rewarding employees financially toward the common achievement of the organisation. The latter insists on the formality of the organisation (the hierarchy). Next, the human relations approach, instead, focuses on the people, the social and psychological effects on their performance including motivations, leadership, communications and group dynamics and the informal relationships in the formal environment, which was early studied by Elton Mayo (1880-1949). Lastly, the systems approach views the organisation as a collection of different correlative sections and if a change occurs with one section, the other sections will also have to change accordingly in order that the overall performance will not be undermined. This approach is considered to appear later and to be more complex than the two first ones.
In the MAS case study by Watson and Story (2006), in respect of the definitions of different management approaches above, the human relation approach appeared to be most considerable. This approach was obviously supported by the concept of an ethical business in combination with several extra benefits which gives MAS’s employees a lot of incentives. Consequently, in the case study, it was mentioned that despite the cost of this business practice: “Even Sharad, the former CFO, thought that payback came in different forms: employees who embraced the company culture, higher productivity, lower downtime.” At this point, the level of employees satisfaction should be measured, which can be done by Maslow needs hierarchy in Worthington and Britton (2009). There are 5 levels in this hierarchy: physiological, safety, love, esteem and self-actualisation. As can be seen from the case study, most of these motives of MAS’s workers were met. For physiological needs, they were working in well-designed factories, able to have free breakfast and lunch as well as to use the on-site medical centre. For safety, the well-designed factories and the medical centre also gave a hand, in addition to the abuse-free working environment and the right to stop the production line when there are troubles. For love, the strong relationships had been built between the employees and the company itself, the employees and managers and the employees with each other through the friendly working environment and many extra activities. For esteem, the workers were assured that they were working in an ethical business with high labour standard and they also had chances to participate in “MAS Women Go Beyond” programme. For self-actualisation, they were able to attend different kinds of classes or training and to have promotion opportunities. These examples made the human relations approach in MAS evident.
In conclusion, the prosperity of MAS was notably influenced by the proper of different management theories, of which the most outstanding are the roles of managers and the human relations approach. While the roles of managers were well played in MAS and help sharply strengthen the business, the human relations approach did that from the very inside of the firm: the satisfaction of each of the people working for it. MAS would still need these advantages for its further development and the way it runs might be a notable example for other companies.
- ‘About us’ [n.d Online] MAS Holdings. Available: http://www.masholdings.com/ [Accessed 11 November 2009].
- ‘Amante’ [n.d Online] MAS Holdings. Available: http://www.masholdings.com/ [Accessed 11 November 2009].
- Boddy, D. (2008) Management: An Introduction. 4th ed. Harlow: Pearson Education.
- Watson, N. and Story, J. (2006) MAS Holdings: Strategic Corporate Social Responsibility in the Apparel Industry. INSEAD.
- Worthington, I. and Britton, C. (2009) The Business Environment. 6th ed. Harlow: Pearson Education.