Administrative Principles Essay Sample
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- Category: management
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Administrative Principles Essay Sample
As Executive Vice President and Chief Financial Officer of Potash Corporation of Saskatchewan, the world’s largest producer of potash, Wayne Brownlee has endured more turbulent financial volatility with a calm and confident ease than many in his position would be capable of. One of the largest challenges of his position as a top manager in the organization is making things happen. He achieves this by increasing profitability through leadership (interpersonal role, leading function) and delegation (decisional resource allocator role, organizing function) to control and utilize the strengths of his entire financial team. Additional top managers such as the VP of Finance; middle managers such as the Senior Directors of Taxation; First-Line Managers such as the Directors of Canadian Tax; and Team Leaders such as the supervisors of T&D Accounting and Financial Projects all play a key role in advising Mr. Brownlee.
This illustrates the solid foundation he has put in place for his company in organizing his people, projects, and processes effectively. Mr. Brownlee’s human skills are a valuable asset, as he remains very approachable and down to earth to all levels of employees in the company. While his technical skills remain strong, he does not require them as often as his Team Leaders do. He regularly performs the informational role of management, most recently speaking at the TD Newcrest Agricultural Conference where he provided an overview of the state of the industry and an update of PotashCorp’s activities. Another one of Mr. Brownlee’s strengths is his awareness of the general and specific environments affecting his company. PotashCorp adjusts its production to stay in line with the demand for its products to keep economic conditions stable. Their Pilot Plant is innovative and keeps their equipment and techniques at the forefront of technology.
The percentage of women and minorities in their workforce has increased each year and their legal department advises the top managers on a daily basis. PotashCorp has many primary and secondary stakeholders that have their voices heard as part of the company’s sustainability commitments. The primary group, which includes their customers, investors, and community leaders, are surveyed each year with a report of the results going to the board of directors. The secondary group includes the media and critics of commercial fertilizers in modern agriculture, many of whom are concerned about environmental and safety impacts. These stakeholders also comprise much of the specific environment. Great communication between Mr. Brownlee and the Corporate Relations department with the critics, customers, suppliers, and regulatory bodies are essential for success. In knowing the market and their competition, PotashCorp has positioned itself for the exponential growth in world food demand by reinvesting in their own company.
Competitors’ desires for a new greenfield mine project are a big gamble. It would cost more than $2.8 billion dollars plus infrastructure costs in a tight credit market and take five to seven years to build. By proceeding with multi-billion dollar expansions of their existing facilities, Mr. Brownlee demonstrates conceptual skills and the planning function, enabling his company to meet this growth in the most cost-effective and efficient manner possible. PotashCorp and its employees follow a strong formal business culture and they both share generously in their discretionary responsibilities. The company set a commitment to charitable donations at 1 percent of after-tax earnings. The employees donate to many charities like the United Way, with every dollar matched by the company’s matching gift program. The employees are hard working and care about their communities. In 2007, they achieved over 70 percent participation in the program.
They also have an active social club that both management and their employees participate in together. PotashCorp works diligently to meet and exceed their social responsibilities each year. Economically, shareholders’ equity increased from a value of $2.78 billion in 2006 to $6.02 billion in 2007. In 2007, they also achieved a total shareholder return of 202 percent, exceeding the 141 percent generated by their sector. Mr. Brownlee takes meeting the economical responsibilities through legal and ethical means seriously. To achieve this, the company published their own Core Values and Code of Conduct that applies to all directors, officers, employees, and representatives of the company. Each year, all employees are asked to reaffirm their commitment to comply with the Code, and to provide assurance that they have complied with it over the past year.
As a result, no PotashCorp employees were dismissed or disciplined for corruption in 2007. An example of the company’s commitment to their ethical responsibilities was their decision to reduce company-wide greenhouse gas emissions per tonne of product by 10 percent by the end of 2012, compared to 2007 levels. They also have a goal to maintain energy usage per tonne of product produced at 2007 levels. PotashCorp operates in a dynamic environment that saw its stock price explode from $30.00 per share to $244.00 between 2006 and the third quarter of 2008. The bubble burst on commodities in the fourth quarter of 2008 as the world deals with a giant financial crisis threatening widespread recession.
The stock price and market cap of the company took an enormous hit, but thanks to Mr. Brownlee’s management and vision, the company’s profits continue to break records every quarter with the 2008 third quarter earnings alone besting that of all 2007, a previous record year. With this kind of financial responsibility on his shoulders, Mr. Brownlee’s strong motivation to manage skill serves him well in this very complex external environment driven by many factors both in (production levels, pricing contracts) and out (crop prices, customer credit) of their control.
Even with a slumping economy, the environmental munificence remains healthy as prospective employees are lining up for jobs underground in the newly expanded mines. Already a world leader in their industry, Potash Corporation of Saskatchewan continues to shine as a model organization through the exemplary management style and business practices shown by their top managers. In Wayne Brownlee, their financial future appears to be bright for many years to come.
Potash Corporation of Saskatchewan. (2007). Summary sustainability report 2007. Saskatoon, SK: Author.