Market-Based Management

7 Pages Posted: 5 Mar 2012

See all articles by Johan De Klerk

Johan De Klerk

Dubai Women's College - Higher Colleges of Technology

Date Written: March 3, 2012


The Market based Management philosophy endeavors to apply the market process principles in organizations to improve organizational performance and profitability by utilizing free market principles, including the knowledge of each employee, irrespective of the level in the organization. Company executives need to mobilize the knowledge dispersed in the heads of many employees throughout the organization to achieve this. This knowledge is often tacit, and impossible for executives to collect all of it to enable them to make decisions. The central theme of this paper is that organizations need to decentralize decision-making to where the knowledge is located rather than trying to move knowledge up the organization for executives to make decisions with inadequate knowledge. MBM is not a formula to run a successful business, but rather a way of thinking and focusing on specific principles and values.

Keywords: Firms and markets, market-based management

Suggested Citation

De Klerk, Johan, Market-Based Management (March 3, 2012). Available at SSRN: or

Johan De Klerk (Contact Author)

Dubai Women's College - Higher Colleges of Technology ( email )

Dubai, 16062
United Arab Emirates

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