József Poór, Eric Sanders J., Gergely Németh, Erika Varga (eds)

Management Consultancy in Central and Eastern Europe

Consultancy in a Global Context


Principal-Agent Theory

The basis for examining the principal-agent problem is the recognition that in most modern companies, the owner and management of the company are split in two. Their relationship can be defined as a contract in which the owner (principal) of a company entrusts the manager (agent) to carry out certain activities on his behalf, which also involves the delegation of decision-making powers to the agent (Jensen & Meckling, 2008: 312). This situation clearly creates a conflict of interest between the parties. Decisions affecting the company are mostly made by the management, so it has the potential to undermine the interests of the owners, even though the owners have just entrusted them with representing their own interests. Owners cannot control the merits of the managers (Kipping & Clark, 2012). The basis of the conflict of interest is information asymmetry, which results from the fact that managers usually know more about the company and how it operates than the owners. However, there are mechanisms that limit the agent’s self-interest efforts. One of these is the capital market, which objectively evaluates the activities of the companies and thus provides information to owners to assess their managerial activity (Kállay, 2012). Another way to control managerial decision-making is to involve an outside professional in certain areas. An independent expert can expose the owner to unnecessary or unreasonable processes and activities within the company, thus supporting efficiency and providing important information to both managers and company owners.

Management Consultancy in Central and Eastern Europe

Tartalomjegyzék


Kiadó: Akadémiai Kiadó

Online megjelenés éve: 2022

ISBN: 978 963 454 704 4

Have you always wondered how to learn the essentials of international management consulting in just a short time, even if you have never received formal management consultancy training before?

Take this book to gain an in-depth understanding of the profession in a global context and further develop your management consulting skills to enhance your career – wherever you are along your career path!

By reading through this brilliant summary of international management consulting and appreciating the various aspects of the profession, you can master the steps of the consulting process, learn to lead and manage consulting organisations, understand the essence of strategic consulting and change management, develop your competencies in business process and IT consulting and acquire new methods of leadership development. You can also find the relevant tools, if you wish to enhance your competencies in knowledge management or leading turnaround projects.

The book provides an overall picture of the current trends in the global and regional consulting market and illustrates the international scene by specific cases from more than eight CEE countries as well as generic ones to improve the effectiveness of learning through practical examples.

The final chapter entitled ‘Quo vaditis, Consultant?’ seeks answers to the question we are all anxious to see more clearly about, i.e. which way the consulting profession is likely to develop in the future.

Read the book today and benefit from the wealth of knowledge and practical tips to further enhance your professional success in global management consulting!

Hivatkozás: https://mersz.hu/poor-sanders-nemeth-varga-management-consultancy-in-central-and-eastern-europe//

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