Use FileMaker-based software to bring ownership and operators together

Posted by Justin Hesser on January 29, 2013

ZTE was once a leading provider of telecommunications and network solutions, as it has worked with the top carriers and mobile software developers to produce fantastic devices. However, the company’s success has dwindled and now executives are searching for answers as to how to turn things around.

A report in the online publication China Daily examines the Chinese company’s struggles, such as a loss of profits last year. According to the article, this may be due to the fact that ZTE has completely separated ownership from operation, meaning that none of the company’s employees – who man the daily operations – are shareholders. 

The article suggests that this structure can only yield two possible results: either the company operators don’t have the incentive to work hard for the shareholders or the shareholders will lose control of the company because they are not immersed in the day-to-day grind, thus leaving managers with no ownership to make decisions.

“The former result can be seen in some state-owned companies where the efficiency is low and corruption is rampant,” the article says. “While the latter one can be found in some multinational corporations, to avoid the management hurting the interests of owners, the shareholders usually offer the executives big salaries and a benefits package that includes a golden parachute.”

Owners likely prefer the latter as it gives them an opportunity to manipulate operational control, but all of this can be avoided if companies simply invest in new software solutions that build efficiency and promote communication and transparency. Using FileMaker to build a custom database software solution can collect data and display it in a way that ownership has a clear view of what is happening, what’s working and what isn’t.

Such a solution could have helped ZTE improve its economic viability. Its ownership structure isn’t necessarily wrong, as long as proper actions are taken.