The art of management or how to organize competent management of a company?
The efficiency of a modern enterprise directly depends on the correct organization of management activities in it. Every business started must have clearly defined tasks, the fulfillment of which must be strived for in order to obtain a positive result. Let's imagine for a moment flying an airplane. What will happen if the crew does not work harmoniously, and the goals of each team member differ from each other. Of course, the aircraft will simply crash. Just as the crew of an airliner has a single goal - to transport passengers safe and sound, so an enterprise should have a single goal - business success for the benefit of all participants in the process.
It is not for nothing that experienced owners and managers of large enterprises call the personnel management system the art of management. Well-organized work and a clear distribution of responsibilities ultimately brings positive results.
Where does competent company management begin?
Competent management in modern business requires strict adherence to assigned tasks in order to make a profit. This is very important to understand. Profit is the “cornerstone” that is the basis of either financial success or destruction of a company. Of course, setting production goals is not an end in itself. The main thing is that all actions performed locally are aimed at the general well-being and prestige of the company.
So, without registering an LLC or individual entrepreneur, it is impossible to open your own business. This is a prerequisite for the existence of a pharmacy, car service center, fashion salon and other enterprises. The future business owner confidently moves towards his goal, visiting all government licensing authorities and services. If for some reason the entrepreneur does not have time to do this personally, he can turn to legal support specialists regconsultgroup.ru. By delegating his goal to another person, the owner, however, ultimately has a positive outcome - the enterprise begins to function. This is how the goals of completely different people and enterprises are combined.
One, two... thousand
If a company consists of two or more people, then its success in the professional sphere will depend on how these people communicate with each other, how harmonious and useful their corporate relationships will be. There are companies with hundreds, thousands of employees. It is in such corporations that there is a communication problem and a business management problem.
In addition to following goals and completing tasks, each participant in the process must be personally interested in the prosperity of the company. In management lexicon this is called “personal motivation.” World-famous corporations, whose products are sold in huge quantities, have a clear system of motivation for specialists at various levels. Whatever one may say, the “carrot and stick method” is still used today. Competent management has an almost perfect system of penalties and rewards, which works as regularly as a clock. It is enough to eliminate this system, and the work of the enterprise will turn into chaos.
Of course, there are quite a few subtleties of enterprise management, the main ones of which are mentioned above. The main thing to remember is that the success of the company depends on the unity of purpose of all participants in the process, constant and constant control and a well-functioning system of social communications.
- Managing any company means managing the people who work in it. The content of management comes down to a targeted influence on the will, consciousness and subconscious of people. The art of managing people has been extremely valued by entrepreneurs of all times. John Rockefeller said that the ability to communicate with people is the most valuable commodity for which he is willing to pay top dollar.
The article analyzes the main methods of company management: persuasion, encouragement, stimulation, coercion. The requirements imposed by legislation on the process of their regulation and the practice of their application in companies are considered; The opinions of leaders of various organizations are given.
The point of managing any company is to effectively organize the use of the property that the owner contributed to its authorized capital. The key issue of management is the competence of the workers who are entrusted with the management of this property. In the process of work, personnel become a resource of the company. On the one hand, people manage property, on the other, other people. But in any case, management consists of purposefully influencing the will of people. The instruments of this influence can be very different.
The created management structure serves the possibilities of the most optimal management of employees and their coordination. Its main purpose is to provide constant impact on property with the help of specialists and mechanisms in order to increase its value and make a profit. If it meets the goals of the organization, it is considered effective. If not, the question arises of changing it in order to bring it into line with such goals.
The goal of management is to balance the interests of owners and employees
The main feature of the management process is the difference in the interests of the owner and the employee. The interests of the owner and specialists who are not owners differ significantly, and sometimes even in different directions. If the owner's interest is to increase the property and for this he pays remuneration to specialists, the latter's interest is to receive a reward, the amount of which may not always be related to the effective use of the property. Consequently, the main concern of the owner is to ensure that the activities of employees are controlled so that they are in the interests of the owner to the maximum extent possible, and not the personal interests of the employee in obtaining greater rewards at any cost, sometimes even to the extent of causing damage to property.
It is no coincidence that the management style of commercial companies is close to the model used by the doges of ancient Venice. They were responsible for losses caused to the state as a result of improper management of all personal property. Owners are seeking to increase control over their property. And for this purpose, a variety of forms are used.
Controls over the use of property in foreign companies
One of the forms of control over property in the United States and other countries is the inclusion in the board of directors of up to 75% of independent experts from among lawyers, consultants, university teachers, and other specialists who have the appropriate knowledge and a significant degree of independence in monitoring the activities of executive bodies.
Another means used and legalized abroad is “piercing the corporate veil,” i.e., when violations of the law and internal company regulations are detected on the part of executive bodies, the guilty officials are subject to the regime of full property liability, even if it is a limited liability company or other economic society. In Russia, there is also liability of managers with personal property for the company’s obligations, but only to the extent of managers for causing damage to it. It is interesting that in pre-revolutionary Russia, in the event of a company's bankruptcy, personal additional (subsidiary) property liability was borne by all members of the board of a joint-stock company.
The role of personnel in company management
Ship management is most effective when it combines unity of command with broad participation in various areas of management of all crew members. A striking example in this regard is demonstrated by Japanese companies that have achieved enormous success in this field. The founder of the Matsushito Electronics company, Kikoto Matsushita, said that each member of the workforce should be considered as a member of the family and should be treated in exactly the same way by management. That is why the management of a company should be built on democratic principles and provide for the broadest possible participation of founders (participants) and other interested parties in its activities.
The “democratic minimum” in the management of legal entities of certain organizational and legal forms is determined by the Civil Code of the Russian Federation and other federal laws. But it must be clarified in the constituent agreement and charter in relation to the specific conditions of the organization being created.
Material and property liability of the organization’s employees
Persons who, by virtue of law or constituent documents, act on behalf of the company are subjects of civil liability. They must act in the interests of the organization they represent in good faith and reasonably. If such a person causes losses to a legal entity, he is obliged, at the request of the founders/participants of the legal entity, to compensate them. Therefore, it is important that the charter states who performs organizational, administrative and economic responsibilities in the company and acts on its behalf. Particular attention should be paid to developing the status of the leader, on whom success or failure in entrepreneurship primarily depends. Today, it is important, with the help of charters, to consolidate and increase the responsibility of managers for the management decisions they make, for the safety and effective use of the company’s property, as well as for the financial and economic results of its activities. The mistake is made by those founders who do not limit the powers of the manager in any way, which allows him to speak on behalf of the company on all issues of business activity. The charter of a commercial organization must contain a provision that only minor transactions are delegated to the sole discretion of the manager, for example, concluding sales and purchase agreements, obtaining bank loans in the amount of 10 to 30% of the authorized capital. All significant transactions must be agreed upon with the founders at a general meeting or at the board of directors. Those founders who do not create an optimal management and control structure sometimes end up with nothing. The charter should include norms/rules on the procedure for making decisions by collective bodies (for example, unanimous expression of will, qualified or simple majority of votes).
Regulation of control over the activities of company management
To organize control over the activities of a legal entity, the charter must also take into account two aspects. The first is internal control, the implementation of which is entrusted to the audit commission or auditor. The second aspect is external control. It is useful for the charter to define the mechanism for carrying out periodic audits. The very nature of such control is not direct and does not imply “real-time” operation. Therefore, he identifies violations, as a rule, “after the fact,” when many things can no longer be corrected. Therefore, founders and managers should keep their finger on the pulse of events and promptly respond to facts of any violations, using all control tools.
Basic methods of managing an organization
The most important aspect of company management is the arsenal of methods that the manager uses, since the effectiveness of the organization depends on management methods. The main ones are persuasion, encouragement, stimulation, coercion.
Persuasion method
This method can be used by all managers. It is effective in companies with a small number of employees, and where there is no or limited possibility of material incentives, and in large organizations, since with its help you can influence thousands, tens of thousands of people, almost without spending money. In Russian and foreign practice, you can find many examples that confirm the effectiveness of using this method, although, unfortunately, there are often cases when it is simply forgotten.
Persuasion most often does not require large expenditures, but with constant, targeted influence it allows you to achieve the highest results, create conviction and inspiration. The main means of persuasion are information, explanations, recommendations, education, training, advertising, agitation, propaganda, moral encouragement, etc. Persuasion has always been the strongest tool for influencing the will and consciousness of people.
In recent years, various studies have written that thought is material. Consequently, beliefs that have been absorbed by consciousness for a long time become reality, and a person embodies them in reality. This is what Colin Turner writes about this in his book “We Are Born to Succeed”: “What you believe in and strive for sooner or later becomes reality. Each of us has a certain power, thanks to which he can create his own world, his reality, the one he wants."
Reward method
Its difference from the method of persuasion is that, in addition to the persuasive influence, it connects the achievement of positive results with the receipt of possible or specifically defined moral and material rewards, which are established and changed at the will and discretion of the manager.
Do entrepreneurs use moral incentive measures effectively enough? Are there not enough wonderful deeds and work achievements made by employees? But do their leaders thank them for this? Are they verbally thanked in the order? Do they, as expected, make an entry about her in the work book? Sometimes individual employees have received one or two acknowledgments over decades of work, and sometimes not even one.
Managers very often miss the opportunity to use this effective management tool.
Coercion method
And finally, coercive measures and negative sanctions are also an integral part of the arsenal of motivation. Indeed, they also encourage, for example, law-abiding actions, but do not act through interest and enthusiasm, which is inherent in encouragement and stimulation, but are based on fear associated with the application of sanctions in case of failure to comply with established requirements.
Among the coercive measures, managers are given the right to apply disciplinary measures, the scope of which is narrowed by the new Labor Code and represents a reprimand, reprimand and dismissal. However, managers often do not have these tools and, instead of applying penalties and subsequently dismissing an employee for improper performance of their duties, dismiss him through staff reduction, thereby increasing costs that could have been avoided.
Currently, the Code of Administrative Violations has introduced a new administrative penalty - disqualification of managers and officials, including for violation of labor laws and improper management of a legal entity. But many managers use this management tool haphazardly. Sometimes they do not react to the wrongdoings committed. And only after repeated violations is the extreme sanction applied - dismissal.
Relationship between different management methods
Thus, the incentives of various management methods differ in their impact on different human emotions, on different incentives that cause joy, for example, in anticipation of receiving a prize at the end of a competition, or fear, for example, in the case of failure to comply with/violation of specially established norms for which such sanctions are provided .
Punishment, as a rule, depends on the severity of the offense, the degree of which is determined by the leader. In some states, extremely stringent sanctions are introduced to solve national problems. For example, in Korea, within three years, they eliminated the distribution of counterfeit products by introducing strict sanctions, including execution. And yet, from the entire arsenal of management methods, stimulants in their various expressions are becoming an increasingly effective way to manage social development. Moreover, their full use is equally important both at the level of government and at the level of corporate governance.
A set of incentives not only in the form of punishments, but also in the form of incentives, benefits, and other positive incentives is a “litmus test” for the degree of democratization of the state, the level of harmony of social relations and the degree of coordination of interests in it.
Therefore, in order to understand the mechanism of action of stimulation, it is necessary to apply both each method and each of its components, and the entire system of methods as a whole. Managers who actively apply the entire arsenal of management methods depending on the situation achieve outstanding results. And the task is to learn how to use them in managing entrepreneurial activity, managing specialists in the process of entrepreneurial activity.
The success of any organization always directly depends on its employees. Or rather, from a good mutual understanding between management and subordinates. Managers have a difficult task: managing staff in such a way as to motivate them to achieve a common goal and ensure a friendly, working environment in the team. So, how should the management process be structured so that all employees, from the cleaner to the main manager, work for the benefit of the company?
The main rules of the leader
Personnel management is a whole science. 90% of an organization's success depends on its leadership. Correct motivation and clear definition of goals are the basis for high-quality work. For effective personnel management, a manager first needs to remember a number of rules:
- Company principles. They must be understood by every employee, regardless of their position. And the manager should listen to the opinions of employees, especially in problematic situations. No, this does not mean that global decisions need to be made by the entire team at a round table! The fact is that every employee resolves certain issues every day, regardless of whether he makes copies of documents or conducts important negotiations with clients. If everyone clearly knows the principles of the company and understands the purpose of their actions, then the manager can be sure that the right decisions will be made at all levels.
- Teamwork. The team needs to be motivated to cooperate cooperatively. Employee management must be structured in such a way that each employee of the company is not focused on their own achievements, but that everyone together achieves one goal.
- Sharing of responsibilities. The head of a large company is simply physically unable to control every process. It is necessary to appoint responsible persons for various issues.
- Initiative is not punishable. Any growing business requires the emergence of new ideas. It is necessary to give employees the opportunity to express their thoughts and participate in the implementation of a new business. And remember that everyone has the right to make mistakes.
- Awareness. If the manager does not want rumors to arise or his instructions to be ignored, then it is worth bringing to the attention of the team information about the real state of affairs of the company. Then the team will make more effective decisions.
- There are no irreplaceables. When managing personnel, you need to remember this. You should not single out specific subordinates and inform the entire team that work will “stand still” without them. Appreciate all employees, do not focus on just one.
- Proven technique. Human resource management requires stability. There is no need to make guinea pigs out of subordinates, testing the latest management trends on them. They work well where it is comfortable to work.
- Discipline. Despite the previous rule, there must be strict discipline and rules of conduct in the organization.
Good example. They often say: “Like the manager, so are the employees.” And they say it for good reason. The manager must set a positive example for the entire team through his behavior and work.
Understand the employee
It was already said above that the team should be aware of current affairs. This is necessary to achieve a single result. A manager must not only issue orders, but also communicate with staff. We need to make it clear to the team that every employee is important to the company. And so that these are not empty words, the manager will have to learn to understand each employee. If problems arise at work, you should not immediately call your subordinate “on the carpet” and accuse him of something. First, you need to understand the situation as a whole, find the root cause of the problem and calmly eliminate it.
Each person has his own life principles, priorities and goals. This doesn’t go away when you get a job. The manager will have to work with an already formed personality and, to some extent, adapt to it. All employee goals are usually subordinated to one of three needs:
- Material reward. A person joins a company to earn money.
- Social status. The employee wants respect for himself as an individual and is committed to career growth.
- Self-expression. The desire to express your opinion on every issue, to work independently on some area.
Based on the goals of the subordinate, the manager must find a personal approach to him. If this goal is achieved, there will be no problems in working with personnel.
Teamwork
Any team that works together has a certain team spirit. More often than not, it all depends on the personal goals of team members and, of course, management. For mutual understanding between employees and the manager, the latter will have to learn to state the essence of his requirements, the tasks of his subordinates in accordance with their goals. That is, personnel management is a kind of psychology. A manager will have to analyze the behavior of subordinates and understand their doubts and fears.
Understanding by staff of the goal and accessibility of the general plan is the basis of properly organized teamwork. It is necessary to let the team understand that it is in a team that they can cope with any tasks.
There are also a number of factors that can significantly reduce the ability to work in a team:
- the purpose of the project is not defined;
- insufficient provision of workers with resources;
- conflict situations among subordinates;
- management's poor attitude towards team performance of the task;
- unstable goal, frequently changing tasks and requirements.
The right motivation
To achieve the best results when completing a project, the most important thing is to properly motivate employees. As a rule, motivation can be material and non-material.
With the first one everything is more or less clear. Most of the team goes to work to earn money. There are two main ways to financially motivate employees:
- Incentives. All kinds of bonuses and bonuses for quality work. This will force a person to work quickly and efficiently.
- Fines. In general, everything is simple. If you work well, you get a salary increase. If you work poorly, you lose bonuses and receive fines.
With non-material motivation, everything is somewhat more complicated and interesting. Let's consider methods of such motivation:
- Promotion. Rarely does anyone refuse to take a higher position. The employee must understand that good work is rewarded with career growth.
- Friendly team. Most voluntary dismissals occur precisely because of conflict situations in the service or misunderstanding. The leader must do everything to prevent this.
- Stability. The employee must be confident in the future. The work must be official, wages must be paid on time, sick leave and vacation pay.
- Collective recreation. If the manager wants the team to have a good atmosphere and a positive mood, it is necessary to organize various types of entertainment events that give employees the opportunity to get to know each other better. These could be corporate evenings, outings, sporting competitions. But it is more effective to do this not on weekends and not by order.
- Advanced training. Periodic retraining of employees is necessary. People need new knowledge to work more effectively. If various types of courses are paid for by the organization, this will also be a kind of reward.
These are the basic methods. In each company, the manager will find his own non-material ways of rewarding. It all depends on the capabilities of the organization and the needs of the team. The main thing is that there are no understatements between employees and that the system of rewards or punishments is clear.
High-quality and fast work of the entire team depends directly on the personnel manager. The secrets of effective work are simple. If a manager simply demands unquestioning execution of orders from employees, he will likely end up with sloppy work done and a tense environment among his subordinates. And with a specific statement of goals and objectives, proper motivation, human attitude - excellent work done in a short time, friendly relationships between employees and a trusting attitude towards oneself.
If the business has grown and some of the areas have separated into separate companies - with their own accountants, lawyers, personnel officers and other administrative workers, then it often becomes difficult to monitor the processes in different structures. There is a way out of this situation - to create a single management company. Why is it needed and how can it help a business? - said Mikhail Bitus and Nikita Tolkanitsa, specialists from the law firm REVERA.
— When in a group of companies the functions of employees in different structures began to be duplicated, staff time was spent inefficiently, and in general it became more difficult to monitor everything that was happening in each company, then it was time to think about creating a management company.
Why do we need a single management company?
Let's describe the situation: you have a group of companies, and each of the companies has its own director, accountant, lawyer, personnel officer, economist and marketer. This approach is ineffective from both a financial and organizational point of view.
What factors indicate that your business needs a management company:
- Different companies own shares in the authorized capital of different group members and there is confusion in the powers between directors
- Business owners find it difficult to control company management
- The staff is bloated and there are difficulties in managing it
What processes does the management company simplify?
The main function of the management company is current management in each individual company of the group. In essence, she replaces the director in the subsidiary: she enters into contracts, issues powers of attorney, and manages property.
Why do business owners need this:
- It becomes easier to control processes within the group: there is no need to collect information from the head of each organization - it is enough to monitor the actions of the head of the management company
- An administrative center appears, where workers not related to production, but necessary for the entire group, are concentrated: lawyers, accountants, marketers, customs clearance specialists, and so on.
- The number of controversial issues is reduced: it is enough to find one director of the management company who will suit all partners: there is no need to approve different candidates for different companies
How does the management company work with other companies in the group?
Basic work scheme: the management company manages all the companies of the group and receives remuneration for this. Subsidiaries can write off these costs as current expenses and thus reduce the basis for calculating income taxes.
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The purchase of management company services must be economically justified. Management costs will not be taken into account when calculating the tax base if:
- The subsidiary structure has specialists on staff whose services it purchases (lawyers, economists, personnel officers)
- The management company manages only formally, and real decisions (and this is obvious) are made by the business owners
How to organize a management company
Launching a management company is a fairly simple procedure.
Key steps:
1. Creation of a management company.
2. Adaptation, if necessary, of corporate documents of all group companies in order to establish a uniform approach to management.
3. Development of general internal norms and rules.
4. Conclusion of agreements on the transfer of leadership and management functions between the management company and each company of the group.
What are the difficulties when working with a management company?
If the management company will provide legal support and assistance in drawing up contracts, statements and other documents to other organizations of the group, then it must obtain a license for this - to provide legal services.
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To do this, it is enough to fulfill only two conditions:
1. Director with higher legal education.
2. At least one employee with a higher legal education and at least three years of legal experience.
As a summary
A management company is a fairly simple and at the same time effective tool in business. It will help not to overstaff and simplify control over hired management.
Creating and implementing such a structure is a fairly simple process. Moreover, it does not require additional cash investments, since it can be financed through payments from managed firms.
But it is worth understanding that the management company cannot make all decisions regarding the group’s work. The solution to key issues remains with the business owners.