Characteristics of Islamic Management
Principles of Islamic Management:
1. Honesty
2. Efficiency
3. Patriotism
4. Right man in the right place
5. Discipline
6. Division of labor
7. Unity of command and unity of direction
8. Centralization and decentralization
9. Preference to the organizational interest
10. Remuneration
11. Economy
12. Justice for all
13. United efforts
14. Dignity of labor
15. Exemption/relax
16. Accountability
17. Tawakkul -The act of relying upon something or someone – to place faith or confidence in Allah (usually).
Characteristics of Islamic Management
1. Basic foundation of Islamic Management is the Quran and Sunnah.
2. Original model of IM is Prophet Muhammad (SAW) and his companions.
3. Only economic development is not the final target of IM.
4. Activities aimed at welfare in the life hereafter.
5. Employees should maintain cordial relationship and team spirit.
6. Accountability is twofold: i) to immediate boss and ii) Almighty Allah
7. Manager considers himself as a vicegerent of Allah.
8. Property is thought to be trusted by Allah to the users and the managers.
9. Decisions are made through consultation ( Mashwara).
10. The manager does not have any greed to misuse the power of the post.
11. There must be prevailing peace, development and other benefits.
12. IM is applicable to personal, familial and social, economic and political organizations.
13. Here hypocrisy, forgery, activities adverse to religion and morality are not tolerated.
14. Management is thought to be a universal concept.
15. There is freedom of thinking and expression.
16. Competition is a common strategy in good deeds.
QURAN AND MODERN MANAGEMENT PRINCIPLES:
1.Management today is defined as “Getting things done through others.”
Following this concept, a Manager is now understood as the person who works through others. A good manager, therefore, is a person who not only knows what is to be done but
exactly how to get it done.
The Holy Quran confirm
[43:32] “We raise some of them above others in ranks, so that some may command work from others…” This ayah from Surah Al-Zakahraf (43:32) encompasses the entire philosophy and wisdom of modern management. It emphasizes, in essence, the creation of appropriate hierarchies and the division of responsibilities subject to individual capabilities.
2. Another most Important Principle of Management is leadership. .
“Without leadership every member of the group will go in his own direction instead of following the decision of the group or participate in teamwork.”
This principle comes from the Hadith of the Prophet (pbuh) which says:
“When three men travel together, they should make one of them their leader.” (Abu Dawood, no. 2608).This Hadith places an emphasis on the importance of leadership.
3. Another Important Principle of the Management is the Joint Consultations.
The modern world realized the importance of joint consultation (Shura) and team-work when the Japanese based its management style on it and proved to the world of its effectiveness.
The Holy Quran advocates for this concept:
[42:38] “…and those who do their work through mutual consultation.
[3:159] “…pass over (their faults), and ask for (God's) forgiveness for them; and consult them in affairs (of moment). Then, when you have taken a decision put your trust in God, for God loves those who put their trust (in Him).”
This principle comes from the social life of Islam. Muslims used to gather before their battles and during the regular meetings held by the Prophet (pbuh) to teach the Sahabah (the
companions) Islamic principles.
4. OBEDIENCE AND RESPECT FOR AUTHORITY
Obedience and respect for authority is the basic fundamental requisite for taking work from others and getting it done. It is necessary for those people who are given the job to complete a
task to obey all legal and reasonable orders and perform it responsibly.
Holy Quran instructs: [4:59] “Obey Allah and His Messenger and those in position of authority among you.”
5. PRINCIPLE OF EQUAL OPPORTUNITIES
The principle of equal opportunities postulate that all members of an organization shall have equal and fair chances to grow, contribute, and be rewarded accordingly.
The Holy Quran emphasis this golden rule [49:13] “O people we created you from a single male and female couple and then divided you in nations and tribes so that you may recognize one another. “Verily the most honorable among you in the sight of Allah is he who is most righteous of you.”
In the light of this Quranic v e r s e if there is any criterion of superiority and respectabilityin the sight of Allah, it is T a q w a (righteousness).”
6. MOTIVATION & COMMITMENT
Commitment to do work can only be achieved through motivation. The way a manager behaves or deals with the subordinates determines the level and vitality of his motivation and
commitment to a great extent.
The Holy Quran too speaks about this golden rule:
[3:159] “(telling the Prophet) if you had been stern and fierce of heart they (the companions and followers) would have disappeared from around you. So pardon them and ask forgiveness for them and consult them in the conduct of affairs”
This beautiful Ayat emphasizes upon two aspects: one, that compassionate and sympathetic behavior towards companions and followers, and second, the adoption of participatory approach when dealing with them i.e. consulting them, is the most effective way of management. If this golden rule is not observed then “they will disappear from you” i.e. they won’t pay
attention nor any interest in you or what your work entails.Both these golden rules play vital role in the motivation of subordinates and inculcating in them the spirit of commitment and passion for work.
7. Unity of Command
The Organization should have a single plan of action to guide managers and workers. This principle can be found in the Holy Quran in these words;
(21:22) “If there were in the heavens and the earth, other gods, besides Allah, there would have been collision in both.”
This Ayat shows the importance and necessity of unity of command and unity of direction.
8. Giving importance to Organizational Interests than Individual.
The interest of any employee or group of employees should not take precedence over the interest of the organization as a whole.
Islam means peace. Muslim means a person who submits his will to the god Allah. This principle can be found in Hadees of Bukhari Shareef where Prophet Mohammad (PBUH) said “I swear by the one who owns my life, nobody can be honest, unless and until he like the things for his brother (other Muslims) that he likes for himself.”
9.WASE OR REMUNERATION
In an Organization the workers must be paid reasonable and fair wage for their services.
Prophet Mohammad (PBUH) says that the worker must be paid before drying his sweat, this helps to keep your workers and employees happy.
10. ELIMINATION OF WASTE
Wastage—either in terms of: material, human capital, energy, machine utilization, or processing time, creates inefficiencies resulting in the increase of costs and consequent decrease
in profits. Continuous and aggressive pursuit of wastage elimination led Toyota to become one of the most efficient manufacturing organizations in the world. Their success is thus based on two principles:
1. Complete Elimination of Wastage; and
2. Equal Level of Respect for all.
Their success-story has inspired many companies throughout the globe, and adoption of these principles and methodologies in these companies concerning continuous elimination of
waste is already underway.
The holy Quran has spoken against wastage and lavish expenditure in following words:
[17:26] “And render to the kindred their due rights, as (also) to those in want, and to the wayfarer. But waste not (your wealth, time, health, Talents, opportunities etc) in the manner of a spendthrift.”
[17:27] “For the wasteful are the brothers of Satan; and Satan is ungrateful to his Lord.”
[7:31] “O Children of Adam! Wear your beautiful apparel at every time and place of prayer: eat and drink: But waste not by excess, for Allah loves not the wasters.”
These are the Ayaats Islam has given Muslims the golden rule of not wasting any thing. A Muslim must also strive to eliminate any wastage around him, at home, workplace, or in society even when faced with resistance. Following these principles an organization can be able to produce best quality products at the least possible cost.
11. OPTIMUM CAPACITY UTILIZATION
The following Ayats from the Holy Quran reveals another golden rule that a Muslim businessman should learn from and practice in his daily life.
[2:233] “ No soul shall have a burden laid on it greater than it can bear…”
[2:286] “On no soul doth Allah place a burden greater than it can bear… (Pray) Our Lord! Lay not on us a burden greater than we have strength to bear.”
These Ayats 2:233, 2:286 are emphasizing on the fact that physical, emotional, and intellectual capacity of an individual is limited and not exhaustive. Additionally, since every person is unique in his talents and temperament, and in his skills, it is important not to burden someone with a task that is beyond his scope to deal with it. This is an important principle of modern business management.
The principles mentioned in 2:233, 2:286, mean:
1. Do not over-burden any resource, whether it is a machine or an employee;
2. Do not under-load any machine or employee; and
3. Balance out the workload onto different machines or on different employees so that none of them is over-burdened or under-loaded with regards to their respective capacities.
For Toyota these three principles are called Muri, Mura and Muda categorized under a single principle called Heijunka, which means to level out the workload. Toyota
Company practices these principles almost religiously If principle (1) is not implemented and the machines are overloaded, then a lot of work-in-process inventory may pile up which will lead to added expenses in terms of material handling and holding cost. If the employees are overloaded, they may feel frustrated, de-motivated, and get tired very quickly, making them inefficient and prone to mistakes which will lead to wastage of time and money.
If principle (2) is not implemented and the machines or employees are under-utilized, the company will face an obvious wastage in the form of fixed overheads. Besides, idle employees
are bored employees and highly de-motivated to carry out even the work which is assigned to them.
If principle (3) is not implemented and some employees are over-burdened while the others are sitting in idleness, it will not only create a feeling of injustice in the minds of those
employees working but a sense of discrimination coupled with frustration and anger which can easily ignite into a possible conflict.
These golden principles are not merely for business management but for every person from every walk of life and profession. It is in fact a system of life as a whole (Deen).
12. THE PRINCIPLE OF QUALITY MANAGEMENT SYSTEM
The Modern organizations finally realized that customer satisfaction is vital for their survival and growth. This gave birth to the concept known as Quality Management Systems.
There are some organizations whose main focus is to satisfy their customers about the quality of the product or service, and they never compromise on it. Interestingly enough, such companies are many times more profitable over other companies who do not have such intentions.
This golden rule of the Modern Organizations was also mentioned in the Holy Quran. . The Holy Quran spoke about Quality Management Systems, and is mentioned in, 7:85, 11:84-85, 17:35, 26:181-182, 55:7-9, 83:1-3
The Holy Quran commands:
[7:85] “…Give just measure and weight, nor withhold from the people the things that are their due; and do no mischief on the earth after it has been set in order: that will be best for you, if ye have Faith.”
[11:84-85] “O my people! Worship Allah. Ye have no other god but Him. And give not short measure or weight: I see you in prosperity, but I fear for you the penalty of a day that will
compass (you) all rounds. & quot; And O my people! Give just measure and weight, nor withhold from the people the things that are their due: commit not evil in the land with intent to do mischief.”
[17:35] “Give full measure when ye measure, and weigh with a balance that is straight: do not withhold from people (including customers) the things that are their due; …woe to those who deal in fraud…”
[26:181-182] "Give just measure, and cause no loss (to others by fraud). And weigh with scales true and upright.”
[55:7-9] “And the Firmament has He raised high, and He has set up the Balance (of Justice), in order that ye may not transgress (due) balance. So establish weight with justice and fall not short in the balance.”
[83:1-3] “Woe to those that deal in fraud,- Those who, when they have to receive by measure from men, exact full measure, But when they have to give by measure or weight to men, give less than due. Do they not think that they will be called to account?” The author and researcher Jim Collins describes about two companies Sony and Merck in his
bestselling books titled “Built to last” and “Good to Great.” The founder of the Merck believed that medicine is for the sick (end) and not for making money out of it (means). The author states that these beliefs are even openly evident in their everyday activities within their companies. It is a natural law that when “means” are recognized as “means” and “ends” of human life are recognized as “ends”, only then the real process of socioeconomic, intellectual, and spiritual evolution takes places and takes us to the extremes of our potential.
For a Muslim businessman, there is no alternative but to satisfy his customer, for him, profit is only a “means” to keep his business alive and to satisfy his customer i.e. the “end.” Rest will
be taken care by the God.
The Holy Quran authorizes this fact in 51:58
[51:58] “Allah is He who is the provider of all Rizq (Livelihood), the Lord of all Power.”
[2:212] “And Allah provides Rizq' to whom he wishes without any account.& quot;
Islam contains all modern quality management principles: According to Prof. AYKUT KIRBAS the verses of the Holy Qur’an and Ahadith of the Prophet (peace be upon him) contain all the principles used in modern-day quality management systems.
13. FULFILLING CONTRACTS, COMMITMENTS, & PROMISES
To run a business successfully, a businessman should keep his promises that he has made.
Dr. Stephan R. Covey writes in his book ‘The 8th Habit’ nothing destroys trust faster than making and breaking a promise.” This fact is applicable not only in the business environment but
also in our individual, social and political environments.
The Holy Quran has instructed the Muslims about this golden rule at several places:
[17:34] “Allah says, ‘Fulfill your contracts. Contracts will be asked about.’”
[16:91] “And the Almighty says, ‘Be true to Allah's contract when you have agreed to it.’
[5:1] “The Almighty says, ‘O you who believe! Fulfill your contracts.’
[61:2-3] “And the Almighty says, ‘O you who believe! Why do you say what you do not do? It is deeply abhorrent to Allah that you say what you do not do.’”
14. Kaizen, JIT, and 5-S.
Jeffery K Liker in his book The Toyota Way has described that Toyota production system today comprises of 14 principles and some of these principles are technically known as Kaizen,
JIT, and 5-S.
A)KAIZEN: THE MANAGEMENT JIHAD AGAINST INEFFICIENCY
Kaizen is a Japanese word meaning continuous improvement. To implement Kaizen, the management of an organization should continuously seek to identify areas where wastage is
being done. Once identified, they then set out to analyze the problem, suggest a solution, plan its implementation, implement it, and finally reviews the change for success or failure (PDCA
cycle).
B) JUST-IN-TIME (JIT) SYSTEM FOR INVENTORY MANAGEMENT
The concept of Just-in-Time invented by Toyota has revolutionized the Inventory. Management Systems in the manufacturing organizations throughout the world. It is based on the
golden principle of keeping only that much amount of inventory that is needed and in order to avoid in-process buffer inventory as much as possible until it is completely transformed into the finished good. JIT is an important part of Toyota Production System (TPS).
A Muslim should be a born JIT expert. The Holy Quran spoke about JIT in 2:219, 9:34. The Holy Quran instructs him in 2:219 that he should spend on himself only as much as he needs and to give away the excess in the way of Allah.
[2:219] “… They ask thee how much they are to spend in the way of Allah; Say: ‘What is
beyond your needs.’” (i.e. do not hoard)”
A Muslim businessman will never accumulate large amount of inventories (wealth) as it is discouraged by the Holy Quran in 9:34, and so will refrain from going such a thing.
[9:34] “O ye who believe! … Those who buy gold and silver and spend it not in the way of Allah, announce unto them a most grievous penalty.”
GO & SEE FOR YOURSELF (VISUAL CONTROL)
Toyota calls it Genchi Gembitsu It works this way: in order to solve any problem, the manager or supervisor at Toyota is obligated to go and see for himself the issue, analyze it, and
take corrective actions. Second hand information is simply not accepted because it is considered to be unreliable, or at least not 100% correct.
This fundamental principle of business management is also mentioned in the Holy Quran.
[17:36] “You shall not accept any information, unless you verify it for yourself. I have given you the hearing, the eyesight, and the brain, and you are responsible for using them.”
A Muslim should know that the Holy Quran commands him (not asks him) to be very cautious about the information he receives and to verify it for its accuracy before making any
decision or judgment or opinion.
C) 5-S
is a set of 5 Japanese terminologies; each one of them states a very practical and important golden principle. Almost all Japanese firms follow these principles in order to achieve
maximum amount of efficiency in their work.
Japanese Term English Equivalent
Seiri Tidiness
Seiton Orderliness
Seiso Cleanliness
Seiketsu Standardization
Shitsuki Discipline
A brief detail of each follows:
1. SEIRI
The first step of the ‘5-S’ process, Seiri, refers to the act of discarding all unwanted, unnecessary, and unrelated materials from any place of concern. It could be the workplace or
home or even a town.
This principle should be ingrained in the mindset of a true Muslim. The Holy Quran mentions this in 17:27 and 7:31
The Holy Quran Instructs: [2:219] “They ask thee how much they are to spend in the way of
Allah; Say: ‘What is beyond your needs.’
2. SEITON
‘Seiton,’ means orderliness, which is all about efficiency. This golden principle relates with putting everything in an assigned place so that it can be accessed or retrieved quickly, as
well as returned to that same place without delays.
3. SEISO
Seiso consists of cleaning up the workplace and giving it a ‘shine.’ Cleaning must be done by everyone in the organization, from operators to managers. Seiso cannot be achieved without having mutual respect for everyone and an atmosphere of brotherhood. Furthermore, italso requires an intrinsic desire and motivation for cleanliness. The Holy Quran understands the importance of cleanliness and instructs its believers to keep themselves clean at all times.
The entire system of Salat (Prayer) is a perfect example and an exercise to ensure that Muslims obey and follow this golden rule at least five times a day, every day, throughout their lives. A Muslim offers his Salat in a Masjid behind an Imam. He first performs ablution which not only purifies him physically but also spiritually. He then stands shoulder-to- shoulder with his brothers irrespective of any social and economic status behind an Imam, and follows his instructions.
Similar should be the scenario in a workplace as well where everyone should feel responsible to work passionately (worship in Salat), respect each other (stand shoulder-to-shoulder), keep his surroundings clean (ablution and cleanliness of Masjid), and follow the instructions of their superiors (Imam) without any resistance or laziness. Needless to say, it is a perfect system.
4. SEIKETSU
The fourth step of 5-S is Seiketsu which more or less translates into ‘standardized cleanup.’ Seiketsu encompasses both personal and environmental cleanliness. People must practice
Seiketsu starting with their personal tidiness to keep themselves motivated and mentally fresh. Visual management is an important ingredient of Seiketsu.
The Holy Quran also provides us with a standardized yet very comprehensive set of rules to obtain and maintain cleanliness at all physical, emotional, intellectual, and spiritual levels. One such standard is the five-time obligatory Salat which is also considered as the Pillar of Islam. Another is ablution, the standards of which are clearly stated in Islamic Fiqh.
5. SHITSUKU
The last step of 5-S is Shitsuku which literally means ‘Discipline.’
This golden rule denotes commitment to maintain orderliness and to practice the first 4 S’s as a way of life. The emphasis of Shitsuku is on the elimination of bad habits and constant
practice of good ones. Once a person achieves the state of Shitsuku, cleanliness and orderliness is then voluntarily and at times subconsciously observed at all time, without the need of reminders or motivation. Shitsuku is the most evolved state of mind that incorporates all the previous golden rules. It is too obvious for any rational mind to conclude how natural it should be for a true Muslim to have this state of mind.
CONCLUSION:
Success and prosperity of an Organization or a Man is the outcome of commitment to certain golden principles of life that are readily available to us in the Holy Quran. These
principles are independent, universal of and primarily aim at building a “whole” man capable of achieving his true potential in the purpose of his life. The Holy Quran; the most comprehensive divine book of the world has the solution to every problem and what remains is the practical implementation of these principles in our socio-economic and political lives.
Islam offers sound management principles that are timeless. Taken from the Noble Quran and the practical example of Prophet Muhammad (peace be upon him), these principles have
been applied for over a thousand years.
In the era of globalization where managers often find themselves managing a diverse blend of people across continents, there is a need for universal principles for management. Islam offers such principles and best practices that any manager can adopt for successful management. For every practitioner of management, from aspiring team leader to the seasoned CEO, these principles will prove to be invaluable as they are suitable for people of all faiths and cultures.
Contributor: Mr. Md. Asadullah, Senior Executive Officer, Social Islami Bank Limited.