Conceptual Skill

"The essential aspect of the executive process is the sensing of the organization as a whole and of the total situation relevant to it." Chester I. Barnard

Conceptual skill involves the ability to see the enterprise as a whole; it includes recognizing how the various functions of the organization depend on one another, and how changes in any one part affect all the others; and it extends to visualizing the relationship of the individual business to the industry, the community, and the political, social, and economic forces of the nation as a whole.

Recognizing these relationships and perceiving the significant elements in any situation, the administrator should then be able to act in a way which advances the over-all welfare of the total organization.

Hence, the success of any decision depends on the conceptual skill of the people who make the decision and those who put it into action. When, for example, an important change in marketing policy is made, it is critical that the effects on production, control, finance, research, and the people involved be considered. And it remains critical right down to the last executive who must implement the new policy. If each executive recognizes the over-a;; relationships and significance of the change, he is almost certain to be more effective in administering it. Consequently the chances for succeeding are greatly increased.

Not only does the effective coordination of the various parts of the business depend on the conceptual skill of the administrators involved, but so also does the whole future direction and tone of the organization. The attitudes of a top executive color the whole character of the organization's response and determine the "corporate personality" which distinguishes one company's ways of doing business from another's. These attitudes are a reflection of the administrator's conceptual skill (referred to by some as his "creative ability")-the way he perceives and responds to the direction in which the business should grow, company objectives and policies, and stockholders' and employees' interests.

ACTION POINT: Examine and understand the relationship of all of the parts of your organization.