*112806*
Economics/6. Marketing and management
Lapina O.N., Trusova
T.V.
South-Russia State University of Economics and
Service, Russia
Concept of Enterprise Success
Success is the basic concept of the
economy. However, despite all the efforts of the economists to find its
criteria, they have not been able to find an unambiguous answer yet. Scientists
distinguish some strategies of management that can help the enterprise to
achieve success. Recent research shows that some scientists use the method of induction
in order to find convincing criteria of success: characteristics of profitable
companies are summed up as general principles of the company management. The
advantage of this approach is that it is practicable and
the values are measured and tested in real companies. However, it is important
to understand that selection criteria for businesses to be considered
“successful” ones and success components that have been studied are subjective
as they are the result of observations made within consulting projects. It
should be taken into account that they are only effective at the given period
of time and success in the past does not guarantee success in the future.
The analysis of the development of the
companies that used to be successful helps to reveal the problems of the method
of induction.
Such analysis was made, for instance,
by McKinsey together with H. Shultz, the professor of the Technical University,
Darmstadt, on the basis of German machinery companies. The analysis helped to
make a fundamental conclusion: there are different strategies that can be
considered a “gear lever” of success rather than any patented recipe for
success.
The analysis of the organizational
culture always raises a lot of questions: which culture or cultures the company
belongs to, whether the organizational culture is typical for the given
industry, which specific features of the culture support the existing strategy and which do not
support it, how to change the culture if required by the changed strategy of
the company.
The 7 C model illustrates close
relationship of the company and corporate culture and, in general, the
interdependence of all the elements of the organization.
Characteristic elements of the model
are:
· Strategy. The
course on the allocation of scarce resources to achieve goals in a given term.
· Structure.
Description of the organizational charts and job descriptions.
· Systems and
procedures. Description of processes and establishment of procedures (i.e.
planning system, method of acceptance and approval of decisions, quality
control, etc.).
· Personnel
structure. “Demographic” characteristics of the major categories of personnel.
· Management style.
Actions of chief executives of the company taken in order to achieve the
company objectives.
· Staff skills. Abilities
that distinguish the staff and the firm as a whole, the so-called key
competences.
· Corporate culture.
Important values and fundamental concepts (philosophy of the firm) that are
brought home to all employees.
7C model proves that you cannot change
one without changing another. Thus, it is impossible to change corporate
culture without changing the strategy and vice versa.
Reasonably established management
structure determines its effectiveness as it provides stability of relations
between the numerous components of the object of management and ensures the
integrity of the system. It connects all elements of the system into a single
whole, significantly influences the forms and the organization of planning,
operational management, ways of organization of work as well as its
coordination, makes it possible to estimate and compare the results of the
activity of each component of the system.
Experts all over the world are
scratching their heads in search of the concept of business success. Many
theoretical or close to practice approaches have appeared. An expert group of
American executives brought together characteristics of a successful enterprise
of the future. They promote “mobile enterprises”. Such enterprises have three
distinguishing features: constant changes, fast response and advanced concept
of quality.
1. Constant changes. Superiority in
competition can no longer be measured by years or months, but by weeks. The
entire production system cannot remain unchanged; it must constantly be adapted
to the changing conditions. Thus, information management becomes the
administration of changes. Stable for many years hierarchical organizational
structures are hardly able to understand and even less able to implement these
changes. According to experts, for the continuous renovation of an enterprise
it is required to follow five basic principles: to have a long-term
objective; to see the ways of achieving
it; to compare required and available resources; to have a strategic plan for their development; to have a radical
program of staff training and development.
2. Fast response. The ability to react
fast can be achieved through intensive process of cooperation within the
enterprise and outside it. Such cooperation cannot be developed without
confidence in the abilities and reliability of the partner. Information
monopoly cannot and should no longer exist. It also applies to the company
culture.
3. Advanced concept of quality. Product
quality is not defined just by the lack of defects. A product is only a material
basis of the relations between a customer and a supplier. All aspects of these
relations should in future meet deep understanding of the quality of a product.
Customers more and more often prefer quality to a cheap price.
Methods of people management and the
political situation in the society are considered to be an important condition
of the three factors of success.
The problem of choosing the type of an enterprise management structure
has become very urgent for companies in modern Russia. The vast majority of
failures in the production management are primarily due to imperfections in the
organizational management structure. At the dawn of the modern Russian business
this problem concerned very few people, as most new companies used to have a small
number of employees and therefore were easy to manage. At that time the most
common were so-called “flat” structures when the manager of the company worked
with subordinates directly, without intermediaries. However, with the increase of the number of employees single
management became impossible and so called “vertical” structure came into
being. The simplest two-level “vertical” structure is now the most widespread
management structure among Russian companies as it is much more flexible and
capable to respond to changes much faster than other structures. In such
systems, information is less susceptible to distortion, since communication
channels are shorter and its transformation during the transition from one
level of management to another is minimal.
Reasonable choice of the type of the
organizational structures depends on the profound analysis of many factors:
availability of computer equipment for the analysis of the structures, strategy
of enterprise development, volume of the work and the production experience of
management personnel. The simplest and most frequently used method for choosing
the organizational structure is the study of the structures of the similar
successfully developing enterprises. Another method is that the development of
a new structure is based on the recommendations of professional consultants and
experts. The methods of objective structuring and organizational simulation are
less commonly used.
Any, even the most perfect structure of
management, is bound to change and improve further. The sooner the management
staff will realize the need for these changes, the more effective the
management process will be, the less the threat of stagnation and regress of
the system. The reason for the inevitability of new organizational relations
and corresponding structures of management lies in constant development and
redistribution of the functions between the elements of the management system,
obsolescence of the structure and scientific and technical changes.
The effective organizational structure,
which corresponds to dynamic changes in the environment, is capable of solving
the following problems: coordination of
the work of all functional services of the enterprise, clear definition of rights
and liabilities, as well as powers and responsibilities of all participants of
the management process. The timely correction of the structure enhances the
effectiveness of the enterprise. The
reasonable choice of the organizational structure largely determines the
management style and the quality of production processes.
The study of successful solution of
practical problems using specific techniques of the organization of mental
activity, the study of various concepts of achieving success gradually evolved
to the analytics concept. Its starting
points are the methods of productive practical activity, which include
“concepts of success”.
References
1. Grabaurov V.S.
Information technology for managers. – M.: Finance and statistics, 2008.
2. Molodchik A.V.
Management: strategy, structure, personnel. – M.: HSE, 2004
3.
Larichev O.I. Decision-making theory. -M.: ISA RAS, 2009